REGISTERED COMPANY
NUMBER: 02171777 (England and Wales) REGISTERED CHARITY NUMBER: 800614
REPORT OF THE TRUSTEES AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST JULY 2023
FOR
FIRST RUNG LIMITED
Sproull & Co. Chartered Accountants Statutory Auditors First Floor, Jebsen House 53-61 High Street Ruislip Middlesex HA4 7BD
FIRST RUNG LIMITED
CONTENTS OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST JULY 2023
| Page | |||
|---|---|---|---|
| Reference and Administrative Details | ] | ||
| Report oftheTrustees | 2 | to | 6 |
| StatementofTrustees’ Responsibilities | 7 | ||
| Report ofthe Independent Auditors | 8 | to | 10 |
| Statement ofFinancial Activities | il | ||
| Statement ofFinancial Position | 12 | ||
| Statement ofCash Flows | 13 | ||
| Notes to the Statement ofCash Flows | 14 | ||
| Notes to the Financial Statements | 15 | to | 23 |
| DetailedStatementofFinancialActivities | 24 |
REFERENCE AND ADMINISTRATIVE DETAILS FOR THE YEAR ENDED 31ST JULY 2023
FIRST RUNG LIMITED
| TRUSTEES | O Ahmed |
|---|---|
| S Riley | |
| JL Szabo-Merridew (resigned 10.1.24) | |
| WA Warner (Treasurer) {resigned 14.12.23) | |
| CS Pike |
|
| S J Stott (resigned 9.3.23) | |
| E J Jones | |
| I J Lawrence | |
| HAli | |
| JREifion-Jones (appointed 13.9.23) | |
| M Mahajan (appointed 13.9.23) | |
| COMPANY SECRETARY | H J Warwick |
| REGISTEREDOFFICE | 197-205 High Street |
| Ponders End | |
| Enfield | |
| Middlesex | |
| EN3 4DZ | |
| REGISTEREDCOMPANY | 02171777 (England and Wales) |
| NUMBER | |
| REGISTERED CHARITY | 800614 |
| NUMBER | |
| AUDITORS | Sproull& Co. |
| Chartered Accountants | |
| Statutory Auditors | |
| First Floor, JebsenHouse | |
| 53-61 High Street | |
| Ruislip | |
| Middlesex | |
| HA4 7BD | |
| BANKERS | HSBC Bankplc |
| 1 The Town | |
| Enfield | |
| EN26LD | |
| BarclaysBank ple | |
| 54 High Street | |
| Ruislip | |
| Middlesex | |
| HA47AT |
Page |
FIRST RUNG LIMITED
REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31ST JULY 2023
The trustees who are also directors of the charity for the purposes of the Companies Act 2006, present their report with the financial statements of the charity for the year ended 31st July 2023. The trustees have adopted the provisions of 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).
OBJECTIVES AND ACTIVITIES
Objectives and aims
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To advance education for the public benefit, particularly but not exclusively, by the provision of vocational training.
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The relief of unemployment for the public benefit, particularly, but not exclusively, by the provision of training, retraining and periods of work experience through the programmes of the Education and Skills Funding Agency (ESFA), or similar programmes funded by local and central Government, corporate partners and the European Social Fund.
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To deliver training and development to young people so that their employment prospects are significantly improved. This can be through classroom or digital delivery.
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To provide learning, training, and work experience opportunities for young people to prepare them for the world of work. This is tailored to the individual needs of the young person and is supported by a comprehensive pastoral care programme.
Public benefit
Trustees of a charity have a duty to report on their charity's public benefit. The Trustees of First Rung Limited have considered the guidance issued by the Charity Commission. The Trustees have concluded that:-
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The aims and activities of the organisation continue to be charitable;
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- The aims and the work done give identifiable benefits in the charitable sector and both directly and indirectly to young people in need;
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The benefits are for the public, are not unreasonably restrictive in any way and certainly not by ability to pay;
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- There is no detriment or harm arising from the aims and activities.
The trustees can confirm that they are complying with the Charity Commission's guidance on public benefit. First Rung is a registered charity; its only activity is the provision of learning, training and preparing young people for work. Prior to joining us many of our learners struggle to identify the next stage in their education or work. The charity, by providing tailor made courses combined with excellent pastoral care, nurtures the young people, enabling them to make the next step in their journey for the benefit of society, local employers and the economy.
Activities
ESFA Study Programme
First Rung continues to develop the 16-18 Study programme, which offers bespoke learning and employability provision to young people based on their needs and prior attainment. The aim is to provide young people with the skills and qualifications to progress to an apprenticeship, employment or further education.
Learners have the opportunity to achieve a level 1 vocational qualification in either business administration, customer service or childcare. They develop their skills in English, Mathematics and ICT by undertaking the functional skills qualification at the appropriate level. First Rung continues to offer GCSE English and Mathematics provision to learners who did not previously achieve at least a grade 3 (grade D) in these subjects.
All learners on the programme attend preparation for life and work sessions to support them to develop the necessary skills and attributes to sustain employment and be a good citizen. All learners are also expected to undertake a work placement as part of the programme.
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FIRST RUNG LIMITED REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31ST JULY 2023
OBJECTIVES AND ACTIVITIES
Apprenticeships
Apprenticeships offer employers the opportunity both to recruit new staff who will be trained to industry standard while they work, and to up-skill existing staff.
Companies with an annual pay bill ofmore than £3 million have to pay an apprenticeship levy at a rate of 0.5% of their annual pay bill. They can use this fund to provide apprenticeship training to their staff. The funds are accessed through the Digital Apprenticeship Service (DAS) system. Apprenticeship standards provide a structure of industry relevant to both on andoff the job training. Off the job training is delivered by First Rung either in centre or on-line. On the job training is delivered in work by the employer. Apprenticeships are both level 2 and 3 and are delivered in a range of vocational areas.
Smaller employers who are not required to pay the apprenticeship levy can also employ and train apprentices. Funding for the training delivered by First Rung is drawn down from the Digital Apprenticeship Service, which pays for 95% of the training, the employer contributing 5%. Training for apprentices aged 16-18 is funded at 100%.
During the year ended 31 July 2023 First Rung delivered apprenticeships in the areas of Early Years, Teaching Assistant, Accountancy, Business Administration and Customer Service.
Reed in Partnership; ESF SEND Youth Unemployment Project
First Rung was a partner of Reed to deliver employability training and mentoring to young people with special educational and social and emotional needs for the final year of delivery. This flexible programme was tailored to the needs of each young person and supported them into work, including apprenticeships or further training. The programme was funded by the European Social Fund and the Greater London Authority. The contract was held by Reed in Partnership and First Rung delivered in North London as a subcontractor. The contract was extended during the year due to strong performance and ended in July 2023.
High Needs Support
First Rung has becomea specialist provider of support to learners aged 16-25 who have additional needs identified in an Education, Health and Care Plan (EHCP). First Rung supported 20 learners during the year, funded jointly through the ESFA and local authorities.
UK Shared Prosperity Fund UKSPF - Multiply Programme
Towards the end of the year, FR secured funding as a subcontractor to Harrow, Uxbridge and Richmond College to deliver numeracy training to young people aged 16-25.
ACHIEVEMENT AND PERFORMANCE
Achievements
Delivery of Learning
First Rung supported 193 Trainees and Study Programme and 50 apprentices learners during the year.
Quality of Provision
The Charity's aim is continuously to improve the quality of the learning that it provides. To achieve this aim, each year a critical self-assessment is undertaken, the findings from which are used to produce a Quality Improvement Plan (QIP) which identifies the areas requiring attention, the person tasked with the work and the deadline of completion.
Ofsted
The Apprenticeship, Study Programme and High Needs provision is subject to inspection by Ofsted. First Rung was inspected by Ofsted in December 2022 and was graded "Good" overall. This included a "Good" judgement in the new areas ofApprenticeships and High Needs support.
Fundraising activities
During this financial year, the Trustees decided that the environment and circumstances were still not conducive to active fundraising. In the future, we will return to active fundraising when the time is right and opportunities arise.
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FIRST RUNG LIMITED REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31ST JULY 2023
FINANCIAL REVIEW
Results for the Financial Year and Long Term Strategy
Following two difficult years due to the Covid Pandemic, with deficits in both, the financial health of the organisation significantly improved resulting in a surplus of £72,993 for the year ended 31 July 2023. During the year the organisation continued to invest in staff development and purchased IT hardware.
Risks attached to achievement of objectives
First Rung faces risks from changes in Government priorities in employment and skills provision; to mitigate this risk the Charity is proactively looking to diversify into alternative income streams, so that there is less dependence on the ESFA contract which at present constitutes the majority of our income. There has been some success in this area with the securing of UKSPF Fund and FR was awarded a Greater London Authority contract at the end of the year with delivery starting in October 2023.
The safety of our learners, many of whom are vulnerable, is of paramount importance to First Rung. To mitigate the risks, all staff and trustees are DBS (Disclosure and Barring Service) checked and have regular training in Safeguarding, ‘Prevent’ and bullying awareness. Safeguarding is included as a topic for discussion at every Board meeting.
Investment policy and objectives
It is the policy of the Trustees to invest surplus cash in short term cash deposits. From time to time the Trustees, via_ the Finance & Premises Committee, look at the overall resources of the organisation and its future needs in order to establish whether there is scope for extending the range of investments. Our present financial position means that this is unlikely to happen in the near future.
Reserves policy
The Trustees have agreed that, in the long term, free reserves should be maintained at a minimum level of 3 months of operating costs, in order to provide cover in the event of any interruption of income and to enable opportunities to invest in the organisation as they arise. The free reserves at 31 July 2023 were £209,000 (£107,000 as at 31 July 2022) which represents between 4 and 5 weeks average operating costs. This has been caused by our investment in the Colindale Centre, the impact of the Covid Pandemic and other outlays which are essential to achieve our long term strategy. This strategy includes a commitment to move to a free reserves level that consistently exceeds three months over the long term, returning to surplus this year supports this policy.
STRUCTURE, GOVERNANCE AND MANAGEMENT
Governing document
The charity is controlled by its governing document, a deed of trust, and constitutes a limited company, limited by guarantee, as defined by the Companies Act 2006.
Day to day decisions regarding the charity are made by the senior management team, led by the CEO. There are two Board sub-committees covering Finance & Premises and Quality and Personnel.
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FIRST RUNG LIMITED
REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31ST JULY 2023
STRUCTURE, GOVERNANCE AND MANAGEMENT
| Board ofTrustees | ||
|---|---|---|
| The following list includes all Trusteesand keymanagement who servedduring the financial year. | ||
| Chair | FrankLongsworth | Resigned 1.12.2022 |
| Elizabeth Joan Jones | Appointed 18.11.2022 | |
| Treasurer | Alan Warner | |
| OtherTrustees | Sonal Riley | |
| OmarAhmed | ||
| JiteshDodhia | Resigned 1.12.2022 | |
| Juliet Szabo-Merridew | ||
| Paulette Lindsay-Greenridge | Resigned 1.12.2022 | |
| SaskiaJane Stotte | Resigned 9.3.2023 | |
| SallyChessum | Resigned 1.9.2022 | |
| RitaSonnie Essien | Resigned 1.9.2022 | |
| Nicholas Sean Jervis | Resigned 1.9.2022 | |
| lainJames Lawrence | Appointed 18.11.2022 | |
| CalvinSidney Pike | ||
| HafizaAli | Appointed 12.12.2022 | |
| Company Secretary | CharlotteAnneHorton | Resigned 1.9.2022 |
| HannahJulieWarwick | Appointed 1.9.2022 | |
| Senior Staff | ||
| ChiefExecutive | Steve Woolcock | |
| Deputy CEO/OperationsManager | Denis Dillon | |
| Head ofCentres and Inclusion | Francesca Muratori | |
| Finance andperformance manager | Druvi Attygalle | |
| Thefollowing Trustee changes have | been recorded since the balance | sheet date: |
| - MohitMahajan | Appointed 13.9.2023 | |
| -Jonathan Richard Eifion-Jones | Appointed 13.9,.2023 | |
| -Alan Warner | Resigned 14.12.2023 | |
| -JulictSzabo-Merridew | Resigned10.1.2024 |
Page 5
FIRST RUNG LIMITED
REPORT OF THE TRUSTEES
FOR THE YEAR ENDED 31ST JULY 2023
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the trustees are aware, there is no relevant information (as defined by Section 418 of the Companies Act 2006) of which the charitable company's auditors are unaware, and cach trustee has taken all the steps that they ought to have taken as a trustee in order to make them aware of any audit information and to establish that the charitable company’s auditors are aware of that information.
AUDITORS
Under section 487(2) of the Companies Act 2006, Sproull & Co., Chartered Accountants and Statutory Auditors, are deemed to be reappointed as auditors.
Approved by order of the board of trustees on 08-02-2024. and signed on its behalf by:
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FIRST RUNG LIMITED
STATEMENT OF TRUSTEES' RESPONSIBILITIES FOR THE YEAR ENDED 31ST JULY 2023
The trustees (who are also the directors of First Rung Limited for the purposes of company law) are responsible for preparing the Report of the Trustces and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
Company law requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing those financial statements, the trustees are required to
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select suitable accounting policies and then apply them consistently;
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observe the methods and principles in the Charity SORP;
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make judgements and estimates that are reasonable and prudent;
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prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business.
The trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the charitable company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Page 7
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF FIRST RUNG LIMITED
Opinion
We have audited the financial statements of First Rung Limited (the ‘charitable company’) for the year ended 31st July 2023 which comprise the Statement of Financial Activities, the Statement of Financial Position, the Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
-
give a truce and fair view of the state of the charitable company's affairs as at 31st July 2023 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended;
-
- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the trustees! use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.
Other information
The trustees are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Report ofthe Independent Auditors thercon.
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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the information given in the Report of the Trustees for the financial year for which the financial statements are prepared is consistent with the financial statements; and
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the Report of the Trustees has been prepared in accordance with applicable legal requirements.
Page 8
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF FIRST RUNG LIMITED
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Report of the Trustees.
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We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
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adequate accounting records have not been kept or returns adequate for our audit have not been received from branches not visited by us; or
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the financial statements are not in agreement with the accounting records and returns; or
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certain disclosures of trustees’ remuneration specified by law are not made; or
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- we have not received all the information and explanations we require for our audit; or
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the trustees were not entitled to take advantage of the small companies exemption from the requirement to prepare a Strategic Report or in preparing the Report of the Trustees.
Responsibilities of trustees
As explained more fully in the Statement of Trustees' Responsibilities, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the trustees are responsible for assessing the charitable company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.
Our responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Independent Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Based on our understanding of the company and the sector in which it operates, we identified the principle risks of non-compliance with laws and regulations related to charitable companies and the application of charitable funds. We also considered those laws and regulations which have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and the Charities SORP (FRS 102).
Through enquiry of management we gained an understanding of their relevant laws and regulations; the entity's policies and procedures regarding compliance; and how they identify, evaluate and account for litigation claims. We understand that the company complies with the framework through having in place robust procedures and policies and by outsourcing and taking external professional legal, tax and accounting advice on relevant specialist functions and areas.
The senior statutory auditor led a discussion with all members of the engagement team regarding the susceptibility of the company’s financial statements to material misstatement, including how fraud might occur. The areas identified in this discussion were:
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Manipulation or error in the classification of income leading to the under or overstatement of unrestricted or restricted funds.
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Manipulation or error in the use of funds leading to expenditure which is not in accordance with the charitable company's objectives.
Page 9
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REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
FIRST RUNG LIMITED
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The procedures we carried out to gain sufficient appropriate audit evidence in the above areas included:
- Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
- Obtain an understanding of internal contro] relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the
charitable company's internal control.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the directors.
- Identifying and testing journal entries.
- Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and
whether the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
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A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Independent Auditors.
Use of our report
This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company’s members those matters we are required fo state to them in an auditors’ rcport and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Michelle Wickwar A.C.A,, F.C.C.A. (Senior Statutory Auditor)
for and on behalf of Sproull & Co.
Chartered Accountants Statutory Auditors First Floor, Jebsen House 53-61 High Street Ruislip Middlesex HA4 7BD Date: es ne
Page 10
FIRST RUNG LIMITED
STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31ST JULY 2023
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|||||||||
|---|---|---|---|---|---|---|---|
|2023|2022|
|Unrestricted|Restricted|Total|Total|
|fund|fund|funds|funds|
|Notes|£|£|£|£|
|INCOME AND|ENDOWMENTS|FROM|
|Charitable|activities|4|
|Main|charitable|activities|1,712,652|-|1,712,652|1,397,519|
|Investment|income|3|491|-|491|66|
|Total|1,713,143|~|1,713,143|1,397,585|
|EXPENDITURE|ON|
|Charitable|activities|5|
|Main|charitable|activities|1,205,399|-|1,205,399|1,157,645|
|Support|costs|434,751|-|434,751|455,710|
|Total|1,640,150|-|1,640,150|1,613,355|
|NET INCOME/(EXPENDITURE)|72,993|-|72,993|(215,770)|
|RECONCILIATION|OF FUNDS|
|Total|funds|brought|forward|219,251|-|219,251|435,021|
|TOTAL FUNDS|CARRIED FORWARD|292,244|-|292,244|219,251|
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CONTINUING OPERATIONS
All income and expenditure has arisen from continuing activities.
The statement of financial activities includes all gains and losses recognised in the year.
The statement of financial activities also complies with the requirements for an income and expenditure account under the Companies Act 2006.
The notes form part of these financial statements
Page 11
FIRST RUNG LIMITED
STATEMENT OF FINANCIAL POSITION
31ST JULY 2023
| 2023 | 2022 | ||
|---|---|---|---|
| Notes | £ | < | |
| FIXED ASSETS | |||
| Tangible assets | 12 | 83,297 | 112,654 |
| CURRENTASSETS | |||
| Debtors | 13 | 248,594 | 277,043 |
| Cash atbank and in hand | 215,433 | 186,879 | |
| 464,027 | 463,922 | ||
| CREDITORS | |||
| Amounts falling due withinone year | 14 | (255,080) | (357.325) |
| NETCURRENTASSETS | 208,947 | 106,597 | |
| TOTAL ASSETS LESSCURRENT | |||
| LIABILITIES | 292,244 | 219,251 | |
| NETASSETS/(LIABILITIES) | 292,244 | 219.251 | |
| FUNDS | 17 | ||
| Unrestricted funds | 292,244 | 219,251 | |
| TOTALFUNDS | 292,244 | 219,251 |
These financial statements have been prepared in accordance with the provisions applicable to charitable companies subject to the small companies regime.
The financial statements were approved by the Board of Trustees and authorised for issue on vese98-02-2024 and were signed on its behalf by: Chie | ae
The notes form part of these financial statements
Page 12
FIRST RUNG LIMITED
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31ST JULY 2023
| 2023 | 2022 | ||
|---|---|---|---|
| Notes | £ | £ | |
| Cash flowsfrom operating activities | |||
| Cash generatedfrom operations | 1 | 29,001 | (302,195) |
| Net cashprovided by/(used in)operating activities | 29,001 | (302,195) | |
| Cash flowsfrom investing activities | |||
| Purchase oftangible fixed assets | (938) | (260) | |
| Interest received | 491 | 66 | |
| Netcashused in investing activities | (447) | (194) | |
| Change in cash and cash equivalents in | |||
| the reporting period | 28,554 | (302,389) | |
| Cash and cash equivalents at the | |||
| beginning ofthe reporting period | 186,879 | 489,268 | |
| Cash and cash equivalents atthe end of | |||
| thereportingperiod | 215,433 | 186,879 |
The notes form part of these financial statements
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FIRST RUNG LIMITED
NOTES TO THE STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31ST JULY 2023
1. RECONCILIATION OF NET INCOME/(EXPENDITURE) TO NET CASH FLOW FROM OPERATING ACTIVITIES
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||||||||
|---|---|---|---|---|---|---|
|2023|2022|
|£|£|
|Net income/(expenditure)|for the|reporting|period|(as|per the|
|Statement of Financial|Activities)|72,993|(215,770)|
|Adjustments|for:|
|Depreciation|charges|30,295|33,133|
|Interest received|(491)|(66)|
|Decrease/(increase)|in|debtors|28,449|(166,897)|
|(Decrease)/increase|in creditors|(102,245)|47,405|
|Net cash|provided|by/(used|in)|operations|29,001|(302,195)|
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- ANALYSIS OF CHANGES IN NET FUNDS
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|||||||||
|---|---|---|---|---|---|---|---|
|At|1.8.22|Cash|flow|At 31.7.23|
|£|£|£|
|Net|cash|
|Cash|at bank|and|in|hand|186,879|28,554|215,433|
|186,879|28,554|215,433|
|Total|186,879|28,554|215,433|
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The notes form part of these financial statements
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FIRST RUNG LIMITED
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST JULY 2023
ie GENERAL INFORMATION
First Rung Limited is a private company limited by guarantee incorporated in England and Wales. The registered office is 197 — 205 High Street, Ponders End, Enfield, EN3 4DZ. First Rung Limited is also a registered charity in England and Wales, Charity number is 800614.
- ACCOUNTING POLICIES
Basis of preparing the financial statements
The financial statements of the charitable company, which is a public benefit entity under FRS 102, 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)’, Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland’ and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.
Critical accounting judgements and key sources of estimation uncertainty
In the application of the charity’s accounting policies, the Trustees are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods. There were no critical accounting estimates and judgements made in preparing these financial statements.
Going concern
At the time of approving the financial statements, the Trustees have a reasonable expectation that the charity has adequate resources to continue in operational existence for the foreseeable future. This view has been reinforced by First Rung's ability to maintain a positive cash balance, without recourse to borrowing, despite substantial deficits in the Income Statement over the last two financial years. This position is strengthened by the continuation of our existing ESFA funding contract until July 2023 and recent confirmation that the following year's contract until July 2024 will show significant growth.
Income
All income is recognised in the Statement of Financial Activities once the charity has entitlement to the funds, it is probable that the income will be received and the amount can be measured reliably.
Expenditure
Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to that expenditure, 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 accounted for on an accruals basis and has been classified under headings that aggregate all cost related to the category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources.
Government grants
The company recognises income arising from government grants using the performance model.
Tangible fixed assets and impairment of fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.
Page 15
FIRST RUNG LIMITED
NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST JULY 2023
2. ACCOUNTING POLICIES - continued
Tangible fixed assets and impairment of fixed assets
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Leasehold improvements Over the term of the lease Plant and machinery 33.33% Straight line Fixtures, fittings and equipment 20% Straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and carrying value of the asset, and is recognized in net income/(expenditure) for the year.
At each reporting end date, the charity reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
Taxation
The charity is exempt from corporation tax on its charitable activities.
Fund accounting
Unrestricted funds can be used in accordance with the charitable objectives at the discretion of the trustees.
Restricted funds can only be used for particular restricted purposes within the objects of the charity. Restrictions arise when specified by the donor or when funds are raised for particular restricted purposes.
Pension costs and other post-retirement benefits
The charitable company operates a defined contribution pension scheme. Contributions payable to the charitable company's pension scheme are charged to the Statement of Financial Activities in the period to which they relate.
Payments in respect of other post-retirement benefits are charged to the Statement of Financial Activities in the period to which they relate.
Employee benefits
The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received.
Termination benefits are recognised immediately as an expense when the charity is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Financial instruments
The charity has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the charity’s balance sheet when the charity becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Page 16
NOTES TO THE FINANCIAL STATEMENTS- continued FOR THE YEAR ENDED 31ST JULY 2023
FIRST RUNG LIMITED
- ACCOUNTING POLICIES - continued
Financial instruments
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Basic financial liabilities
Basic financial liabilities, including creditors are initially recognized at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of operations from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognized initially at transaction price and subsequently measured at amortised cost using the effective interest method.
-
INVESTMENT INCOME
| INVESTMENT INCOME | |||
|---|---|---|---|
| 2023 | 2022 | ||
| + | £ | ||
| Interest receivable | 491 | 66 | |
| INCOME FROM CHARITABLE ACTIVITIES | |||
| 2023 | 2022 | ||
| Activity | Zi | £ | |
| ESFA Study programmeand | |||
| traineeships | Main charitable activities | 974,765 | 721,466 |
| Apprenticeships | Main charitable activities | 191,190 | 215,926 |
| Other | Main charitable activities | 546,697 | 460,127 |
| 1,712,652 | 1,397,519 |
Page 17
FIRST RUNG LIMITED
NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST JULY 2023
5. CHARITABLE ACTIVITIES COSTS
| 5. | CHARITABLE ACTIVITIES COSTS | |||
|---|---|---|---|---|
| Direct | Support | |||
| Costs (see | costs (see | |||
| note 6) | nofe 7) | Totals | ||
| £ | £ | £ | ||
| Main charitable activities | 1,205,399 | - | 1,205,399 | |
| Support costs | - | 434,751 | 434,751 | |
| 1,205,399 | 434,751 | 1,640,150 | ||
| 6. | DIRECT COSTS OFCHARITABLE ACTIVITIES | |||
| 2023 | 2022 | |||
| £ | £ | |||
| Staffcosts | 1,128,704 | 1,104,867 | ||
| Learnersupport costs | 4,057 | 6,563 | ||
| Trainingcostsand materials | 9,295 | 12,700 | ||
| Registration fees | 63,343 | 33,515 | ||
| 1,205,399 | 1,157,645 | |||
| Ts | SUPPORTCOSTS | |||
| Governance | ||||
| Management | costs | Totals | ||
| £ | £ | £ | ||
| Support costs | 424,251 | 10,500 | 434,751 | |
| Support costs, included in the above, are as follows: | ||||
| 2023 | 2022 | |||
| Support | Total | |||
| costs | activities | |||
| £ | £ | |||
| Sundries | 19 | 1,681 | ||
| Premises costs | 289,811 | 291,841 | ||
| Office costs | 52,630 | 75,963 | ||
| Legaland professional | 6,205 | 9,585 | ||
| Bankcharges | 464 | 475 | ||
| Bad debt provision | - | 235 | ||
| Staffexpenses | 44,827 | 32,297 | ||
| Depreciation oftangibleand heritage assets | 30,295 | 33,133 | ||
| Auditors’ remuneration | 10,500 | 10,500 | ||
| 434,751 | 455,710 |
Page 18
FIRST RUNG LIMITED
NOTES TO THE FINANCIAL STATEMENTS- continued FOR THE YEAR ENDED 31ST JULY 2023
8. NET INCOMEEXPENDITURE)
Net income/(expenditure) is stated after charging/(crediting):
----- Start of picture text -----
||||||
|---|---|---|---|---|
|2023|2022|
|£|£|
|Auditors’|remuneration|10,500|10,500|
|Depreciation|- owned|assets|30,295|33,133|
----- End of picture text -----
- TRUSTEES' REMUNERATION AND BENEFITS
There were no trustees' remuneration or other benefits for the year ended 31st July 2023 nor for the year ended 31st July 2022.
Trustees’ expenses
There were no trustees' expenses paid for the year ended 31st July 2023 nor for the year ended 31st July 2022.
- STAFF COSTS
----- Start of picture text -----
||||||
|---|---|---|---|---|
|2023|2022|
|£|£|
|Wages|and|salaries|1,022,359|1,000,207|
|Social|security|costs|83,476|81,800|
|Other|pension|costs|22,869|22,860|
|1,128,704|1,104,867|
----- End of picture text -----
The average monthly number ofemployees during the year was as follows:
----- Start of picture text -----
||||||
|---|---|---|---|---|
|2023|2022|
|Direct|charitable|services|32|35|
----- End of picture text -----
The number of employees whose employee benefits (excluding employer pension costs) exceeded £60,000 was:
----- Start of picture text -----
|||||
|---|---|---|---|
|2023|2022|
|£80,001|- £90,000|1|1|
----- End of picture text -----
Of the employees whose emoluments exceed £60,000, one (2022: one) has retirement benefits accruing under defined benefit scheme £354 (2022: £354). Pension contributions relating to those staff earning over £60,000 totalled £4,250 in the current year (2022: £4,250).
The senior management team (consisting of Senior Staff Chief Executive, Deputy CEO and Operational Manager and Head of Centres and Inclusion) received total remuneration of £193,000 (2022: £193,000).
Page 19
FIRST RUNG LIMITED
NOTES TO THE FINANCIAL STATEMENTS- continued FOR THE YEAR ENDED 31ST JULY 2023
| 11. | COMPARATIVES FORTHE STATEMENTOF FINANCIAL ACTIVITIES | COMPARATIVES FORTHE STATEMENTOF FINANCIAL ACTIVITIES | COMPARATIVES FORTHE STATEMENTOF FINANCIAL ACTIVITIES | ||
|---|---|---|---|---|---|
| Unrestricted | Restricted | Total | |||
| fund | fund | funds | |||
| z | £ | £ | |||
| INCOME ANDENDOWMIENTS FROM | |||||
| Charitable activities | |||||
| Main charitable activities | 1,397,519 | - | 1,397,519 | ||
| Investment income | 66 | - | 66 | ||
| Total | 1,397,585 | - | 1,397,585 | ||
| EXPENDITURE ON | |||||
| Charitable activities | |||||
| Main charitable activities | 1,157,645 | - | 1,157,645 | ||
| Support costs | 455,710 | - | 455,710 | ||
| Total | 1,613,355 | - | 1,613,355 | ||
| NET INCOME/(EXPENDITURE) | (215,770) | - | (215,770) | ||
| RECONCILIATION OF FUNDS | |||||
| Total funds brought forward | 435,021 | - | 435,021 | ||
| TOTAL FUNDSCARRIEDFORWARD | 219,251 | - | 219,251 | ||
| 12. | TANGIBLE FIXED ASSETS | ||||
| Fixtures | |||||
| Leasehold | Plantand | and | |||
| improvements | machinery | fittings | Totals | ||
| £ | £ | £ | £ | ||
| COST | |||||
| At Ist August2022 | 236,190 | 178,498 | 39,560 | 454,248 | |
| Additions | - | 558 | 380 | 938 | |
| At 31st July2023 | 236,190 | 179,056 | 39,940 | 455,186 | |
| DEPRECIATION | |||||
| At lst August2022 | 129,149 | 175,100 | 37,345 | 341,594 | |
| Charge for year | 24,886 | 3,444 | 1,965 | 30,295 | |
| At31stJuly2023 | 154,035 | 178,544 | 39,310 | 371,889 | |
| NETBOOK VALUE | |||||
| At 31st July2023 | 82,155 | 512 | 630 | 83,297 | |
| At31stJuly2022 | 107,041 | 3,398 | 2,215 | 112,654 |
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FIRST RUNG LIMITED
NOTES TO THE FINANCIAL STATEMENTS- continued FOR THE YEAR ENDED 31ST JULY 2023
----- Start of picture text -----
|||||||||
|---|---|---|---|---|---|---|---|
|13.|DEBTORS:|AMOUNTS|FALLING|DUE|WITHIN|ONE|YEAR|
|2023|2022|
|£|£|
|Trade|debtors|26,656|23,933|
|Other|debtors|72,759|70,529|
|Prepayments|and|accrued|income|149,179|182,581|
|248,594|277,043|
|14.|CREDITORS:|AMOUNTS|FALLING|DUE WITHIN ONE YEAR|
|2023|2022|
|£|£|
|Trade|creditors|28,176|16,140|
|Social|security and|other|taxes|22,021|24,328|
|Other|creditors|163,935|281,842|
|Accrued expenses|40,948|35,015|
|255,080|357,325|
|15.|LEASING AGREEMENTS|
----- End of picture text -----
Minimum lease payments under non-cancellable operating leases fall due as follows:
----- Start of picture text -----
|||||||
|---|---|---|---|---|---|
|2023|2022|
|£|£|
|Within|one|year|38,874|123,575|
|Between one and|five|years|36,500|75,374|
|75,374|198,949|
|ANALYSIS OF NET ASSETS BETWEEN FUNDS OF NET ASSETS BETWEEN FUNDS NET ASSETS BETWEEN FUNDS ASSETS BETWEEN FUNDS BETWEEN FUNDS FUNDS|
|2023|2022|
|Unrestricted|Restricted|Total|Total|
|fund|fund|funds|funds|
|£|£|£|£|
|Fixed|assets|83,297|-|83,297|112,654|
|Current|assets|464,027|-|464,027|463,922|
|Current|liabilities|(255,080)|-|(255,080)|(357,325)|
|292,244|-|292,244|219,251|
----- End of picture text -----
16. |ANALYSIS OF NET ASSETS BETWEEN FUNDS OF NET ASSETS BETWEEN FUNDS NET ASSETS BETWEEN FUNDS ASSETS BETWEEN FUNDS BETWEEN FUNDS FUNDS
Page 21
FIRST RUNG LIMITED
NOTES TO THE FINANCIAL STATEMENTS- continued FOR THE YEAR ENDED 31ST JULY 2023
17, MOVEMENT IN FUNDS
----- Start of picture text -----
||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
|Net|
|movement|
|At|1.8.22|in|funds|At|31.7.23|
|£|£|£|
|Unrestricted|funds|
|General|fund|219,251|72,993|292,244|
|TOTAL FUNDS|219,251|72,993|292,244|
|Net|movement|in|funds,|included|in|the|above|are|as|follows:|
|Incoming|Resources|Movement|
|resources|expended|in|funds|
|£|£|£|
|Unrestricted|funds|
|General|fund|1,713,143|(1,640,150)|72,993|
|TOTAL FUNDS|1,713,143|(1,640,150)|72,993|
|Comparatives|for movement|in|funds|
|Net|
|movement|
|At|1.8.21|in|funds|At|31.7.22|
|<|£|£|
|Unrestricted|funds|
|General|fund|435,021|(215,770)|219,251|
|TOTAL|FUNDS|435,021|(215,770)|219,251|
|Comparative|net movement|in|funds,|included|in|the|above|are as|follows:|
|Incoming|Resources|Movement|
|resources|expended|in|funds|
|£|£|£|
|Unrestricted|funds|
|General|fund|1,397,585|(1,613,355)|(215,770)|
|TOTAL FUNDS|1,397,585|(1,613,355)|(215,770)|
----- End of picture text -----
Page 22
FIRST RUNG LIMITED
NOTES TO THE FINANCIAL STATEMENTS- continued FOR THE YEAR ENDED 31ST JULY 2023
18. RELATED PARTY DISCLOSURES
There were no related party transactions for the year ended 3 1st July 2023.
Page 23
FIRST RUNG LIMITED
DETAILED STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31ST JULY 2023
| 2023 | 2022 | |
|---|---|---|
| £ | £ | |
| INCOMEAND ENDOWMENTS | ||
| Investment income | ||
| Interest receivable | 491 | 66 |
| Charitable activities | ||
| ESFA Studyprogramme and traineeships | 974,765 | 721,466 |
| Apprenticeships | 191,190 | 215,926 |
| Other | 546,697 | 460,127 |
| 1,712,652 | 1,397,519 | |
| Total incoming resources | 1,713,143 | 1,397,585 |
| EXPENDITURE | ||
| Charitable activities | ||
| Wages | 1,022,359 | 1,000,207 |
| Social security | 83,476 | 81,800 |
| Pensions | 22,869 | 22,860 |
| Learner support costs | 4,057 | 6,563 |
| Training costs and materials | 9,295 | 12,700 |
| Registration fees | 63,343 | 33,515 |
| 1,205,399 | 1,157,645 | |
| Support costs | ||
| Management | ||
| Sundries | 19 | 1,681 |
| Premises costs | 289,811 | 291,841 |
| Office costs | 52,630 | 75,963 |
| Legal and professional | 6,205 | 9,585 |
| Bank charges | 464 | 475 |
| Baddebt provision | - | 235 |
| Staffexpenses | 44,827 | 32,297 |
| Depnofleasehold improvements | 24,886 | 24,886 |
| Plantandmachinery | 3,444 | 6,153 |
| Fixtures and fittings | 1,965 | 2,094 |
| 424,251 | 445,210 | |
| Governance costs | ||
| Auditors' remuneration | 10,500 | 10,500 |
| Total resources expended | 1,640,150 | 1,613,355 |
| Netincome/(expenditure) | 72,993 | (215,770) |
This page does not form part of the statutory financial statements
Page 24