Company registration number". N1029491 chai.ity registi3tion number.. 102460 Paragon Studios Ltd (A company limi*d by guarantee) Annual Report and Financi￿ Statements for the Year Ended 31 May 2023 Hopper & Co Chartered Accountant 6 Doagh Road Ballyclare Co Antritn BTJ9 9BG Paragon sthdios Ltd Conceuts Reference and Administrative Details Trustees, Report 2to5 Statement of Trustees, Responsibxlities Independent Examinefs R¢port Ststement of Fin8n¢ial A¢tivities BalanGe Sheet Notes to the Finaneial Ststements IOto21 Paragon Studios Ltd Reference and AdmAnistrative Details Chairperson Ray Cashell Trustee Peter Mutschler Ray Cashell Anne Mager Katherine Sara Lindsay Rachel Botha Michael Patrick Conlon Sinead Marniion Niamh Swllion se￿tary Anne Mag¢ Charity Registration Number I02460 Company Registration Number N1029491 The charity is incorpornted in Northern Kreland. I l Rosemary Street Belfast BTI IQA Hopper & Co Chartered Accountant 6 Doagh Road Bally¢lare Co Antrim BT39 9BG Reoistered Offiee Independeot Exaffjiner Page I Paragon Studios Ltd Trnstees, Report The truste¢s, who are directors for the purposes of company law, pre￿nt the annual report together with the financial st&tements of the charitsble company for the year ended 31 May 202). The truytees as at the date of this report are as set out on page l. Objectlves and aetivities Objects and alm Paragon Studios Ltd ( hereinafter referred to as PS2) has two main objectives: l) to provide good, affordable and long terni work spaces for artists 2) to support and encourage artists and ¢￿tural p￿titiOnerS to produce and show individual or collaborative new work either ingide our project space or at outside lo&qtions. often with the inclusion of lo¢al eoit)munities. With a strong belief in th¢ relevance of art and its function in society. we aim to find new and surprising ways to faGilitste tbe produclion of nev4 woik and make it accessible to a wide audience. TEiis aim to connect contemporary art and people is done in differenl ways - through long tenn projects ￿1th eommunities, r¢levant subjects, participatÉon, opewiess and inclusion. Our organisatiou is artist led, efficient and restlessly committed to Art and its fun¢tion for the general public.. to stimulate reflection. provoke, inspiTe enrich and transforni. We support artists whose work is exciting. original, relevant and of high artistic qualjty. We see our position in the arts ecology as a colourful building step for artists between th¢ start of and midway througb their care¢r. We provtde and facilitate unrestrictsd and uncommercial opportunf(ies for thtsts to show their work and internct with the public. Public benefit Through tbe provision of affoFdable and subsidtsed workspaces, regular free workshops, community engaged Projects and an experimelltsl exhtbitiO￿ programme for early to mid career artists in our projett spac¢. the public at large ¢aD enjoy and benefit from a greater understanding and appreciation of th¢ arts. Irj all our activities the wider public is encouraged to participats and co-produce. pot¢Dtially developing any artistic tendencies they may possess. The trustees confirni that they Ellve eornplitd with the requiwnents of section 4 of the Charitt¢s Act 2008 to have du¢ Tegard to the public benefit guidan¢e published by the Charity Comrnission for Northern Jreland. Page 2 Paragon Studios Ltd Trustees, Report Achievements and performance Funding Our core ￿llder remains th¢ National Lottery through the Arts Couftcil of Norhtem Ireland. Our fvll time 3 y¢ar position is funded by Futurescreen Nl, and various streams of project funding come from Belfast City Council. Until the end of 2023, PS2 still receives fimding from the Freelands Foundation for the Freelands Artist Progranune (2018-2023 ). Siuc¢ having a part time strategi¢ ¢t￿tor, our thnding sources diverstfied 2nd broadened th¢ reporting period in line with OUT 5 year Strate￿. Premiseslstudio and workplace provision PS2 operates from its pr¢mises at I l and 15 Rosemary Street, wtth project space including I l individual artist Studioslworkplaces and 3 residency spaces. As mLwh as we now enjoy the pr¢mise$ since moving in over 3 years ago. we only have a Tenency at Will contract with a high degw of uncertaittty. Securing long¢r tem premÈs¢s ¢ontinues to b¢ a priority. Arts Programme PS2 carrted out 2J proj#ts involving 76 artists and 41 workshops witb ?39 participants duTing the reporting period.The programme was ¢urated by our new PTOjeCt curator, Davy MahoD. The year round weekly l>pen Communal Shared Drawing prograinme, now running for over 3 years delivered online, h&8 a steady and high number of participartts from Northern Ireland and abroad. which makes it the most success￿1 and ac¢essible activity. Selected Projects Profe*siona] development is one o'f the key aspects of our artist SlEPPOrt. Th¢ Fr¢elands Artist Progtwrjme. whicb will end after 5 years in D￿ernber 2023. saw 20 emerging and re-emerging artists based in Northern Ireland receiving tailored curatori21 supporL p¢er learnijig, exhibitions and other opportunÉti¢s. The prOgra￿￿e of 3, year long" residencies continued and demonstrated the benefit of longer terni committh6nt: l) With Clodagh Boyce, a llew curator ij) resid¢nce was s¢le¢ted. focusing on people of ¢lour qu¢er communitTes in their Collaborative programme 2) The criti¢al writing residency continued their ¢ollaboration with African ArtÉsts Foundatiow Nigeri focusing on 'Reclaiming Art Histories & Developing Critical DI￿10Sure, 3) Soft Fiction Projects continued their collective residen¢y, worf(ing on publications and rnnnig workshops for Risograph printing as a tool for ¢mpowernient Finallcial review Policy on r£¥erves The directors. policy Én relation to free Yeserves is to ensure that PSI maintsins mlnimum reserves equivalent to at least two months of nomial ¢haritable expenditure in order to maintain liquidity, to cover any unforseen costs which nTry arRs¢, and to fulfill obligations of PS. in the event current lev¢ls of income aR not malntained. Free reserves are defined as totaI reserves ex¢luding any restrACted funds. Page 3 Paragon Studios Ltd Trnstees, Report Plans for future periods Aims andkey objectivesforfutureperiods PS2 has completed a businees plan for 2022_2025 outlining the vision and aims of the organisation.Thr transitio from a volunteer to an OTganisation led by paid pmfessionats is underway and progressing. The next urgent st¢ps for a sustsinable future are: l) establish additional paid positions T.e. a creative director and a finance administrator. To make a successful transition pos5ibl¢ and to continue and expand the programme and activities offered, PS and it% Board irjust look for add3tional funding sources. 2) Secu￿ longer t¢rni premises for QLTrr studios and project space 3) stretigthen and refresh the Board wtth dedicated external expertise and studio members Structure? govern2nce and management Nalmre ofgoverning document PS2 is a registered ¢Ewity and a company limited by gvarantee and so does not have a share c41ital. Th¢ liability of each member Ts limited to £1. The cornpany is governed by its Articles of Association. IAduelEon ondcwred by the charity in the delivery of its activÉties and services for its beneficiaries. It incllldes both costs that be allocated directly to such activities and those costs of an indirert uature necessary to support them. Governance costs These includt the costs attributable to the cbaiity's compliance with constitutional and statutory Tequirements. including &udit. strategic nwiagement and trustees meetitw and reimbursed exp¢nses. T8xxtion The ¢harity is wnsidered to pass the tests Set out in Paragraph I Schedule 6 of the Finance Act 2010 and therefore it meets the definition of a charitsble company for UK ¢oryor*ion tsx purposes. Accordingly, the charity is potentially exempt from t&Yation in respect of tncome or capita] gains received wÉthin categories covered by Chapter 3 Part 1 l of the CorpoTation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gaing are applied exclusively to ch￿7￿ble purposes. Tangible r￿ed assets Individual fixed assets costiug £1.00 or more are initia]ly recoided at ¢0¢ less any subs4uetrt accumulated d¢pTe¢iation and subsequent accumulated impairnlent losses. Depreciation and amortisation Depreciation is provided on tangible fixed assets so is to write off the cost or valuation, l¢ss any estimated residual value, over their expected usefijl economic life as frillows: C%sh and cash equivalents Cash and cash equivalents comprise ¢ash on Iwid and call dewJSits. and other short-terni highly liquid investments that are readily eonv¢rtible to a known amount of cash and are subject to an insignifi¢allt risk of change in value. Borrowings Interest-bearing borrowings are initially recorded at fair v2]ue, net of transaction costs. Interest-bearing borrowings are subsequently carried at amorttsed cost, wkth the difference between the proceeds, net of transaction costs, and the amount dtje on redemption being re¢ogAised ￿ a charge to the Statement of Financial Activities over the period ofthe relevant borrowing. ILrterest expense is recognised ol) tbe basis of the effective int¢rest mcthod and is in¢luded in ixterest payabl¢ and similar charges. Borrowings are classified as current llabilities unless the cbarity has an unconditional right to defer settlement of the liability for at least twelve months after the Teporting date. Page 12 Paragon Studios Ltd Notes to the Financial Ststements for the Year Ended 31 May 2023 Foreign exchange Transactions in for¢ign currencies are worded at the rate of excharLge at the date of the transa¢tion. Monetary assets ond liabilities denominated in foreffign cutt￿cleS at the balance sheet dats are reported at the rates of exchange prevailing at thal date. The results of overseas op¢ratÉons are translated at the average rates of exchange during the period and their balance sheets at the rates mling at the balance sheet date. Exchange differences arising on translation of the opening net asset5 and results of overseas operations ar¢ reported in other comprehensive income and accumulated in equity (attributed to non-coatrolling interests as appropriate). Other exohange differen¢¢s are recognised in the Statement of Financial Activities in the period in which they arise exwt for: l ) exchange differences on traDsactiotLS enteied into to hedge ¢ert&'n forei￿ curren¢y rtsks {see above)" 2) exchange differences arising on .￿InS or losses on non-monetary it¢n]s which are recogRis¢d in other compreh¢nsive income" and J) in the ¢as¢ of th¢ Gonsolidated fInancial statements. exchange differences on monetary items receivable from or payable to a foreign operation for which settlement is netther planned nor likely to occur (therefore fomÉng part of the iiet investment in the foreign operation), which are recognised in other comprehensiv¢ income and reported under equity. Fund strueture Unrestricted income funds are general funds that are avallable for at the tr￿te¢S discretion in furtherance of the objectives of the charity. Restricted income fimds are those donated for use in a partI￿lar area or foT specific purposei the us¢ of which is restricted to that area or purpose. Financial instrumeDts Classification Financial ￿ets atsd financial liabilities are recognised when th¢ charity becomes a paty to the contractual provisions of the instrument. Financial liabilities and equity instruments are classified accordills to the substance of the contractual aTrangements entered into. An equity instrument is any contract that evidences a residual int'erest in th¢ assets of the charity aft¢r deducting all of its liabilities. Page 13 Paragon Studios Ltd Notes to the FinancAal Statements for the Year Knded 31 May 2023 Derivalivefmémeial inslrupnénts The charity uses derivative fnttn¢ial instnunents to redu¢e exposure to foreign exchange rtsk and interest rate movements. The charity does not hold or sssue derivative financlal instruments for specu12tive purposes. D¢rivatives are initially recognised at fair value at the date a derxvative contract is entered into and are subsequently r¢measured to their fair value at ea¢h reporting date. The resultillg gain or los$ is re¢ognised in st&ement of financia] acttvities immediately unless the derivative is designated and effective as a hedging Inst￿men( in which event the timing of the ￿COgnition in statement of financi￿ activities depends on the nature of the hedge relationship. Féur valug measurement The best evidence of fair value is a quoted PTiC¢ for an identieal asset in an active markeL When quoted prices e unavailable, tbe price of a recent transaction for an identical asset provides eviden¢e of fair value as long as there has not been a significant change in ¢¢onomic circumstances or a significant 13pse of time since the tr2nsactio7) took place. If the Tnaiket is not active and recent transactions of an identical asset on their own are not & good estimate of fair va]u4 the fair value 15 estimated by using a valuation technique. 3 Income from donations aud legaciès UnrestrActed funds General Total funds Donations and lega¢ies' Donations fron] individua]s Donated services 2nd facilities 646 31,680 646 31.680 Total for 2023 32326 Totsl for 2022 4 Ineome from charitsble aetivities Unrestricted funds GeA)erg1 Restricted fuDd$ Total funds Studio operating costs Arts Council Belfast City Council University of Ulster Freelands Esme Mitchell Elephant Trust Cavehill Primary School 4,960 4,960 l8,881 13,627 21.919 62.892 6,000 2.000 1,000 18,881 13.627 21,919 62,892 6,000 2,000 1,000 126,319 Total for 2023 4,960 131,279 Totsl for 2022 5,080 142,897 147,977 Page 16 Paragon Studios Ltd Notes to the Financial Statements for the Year Ended 31 May 2023 5 Other income Unr&strieted funds General Total fun(ts Fees and supplies 813 813 Total for 2023 813 813 6 Expenditure on raising funds Total costs 7 Expenditure on charitable activities Unrestricted fullds GeNeral Restrirted funds Total funds Note Studio operatin8 costs Arts Council Belfast City Coun¢il University of Ulster Freelands British Council The Mac Elephant Trust Cavehill Primary School Depreciation. amorttsation and other Simil￿ costs Governan¢e costs 37,405 37,405 7.826 12,768 7,826 12.768 19,033 58.632 23.149 317 2.072 937 58.632 23,149 317 2.072 937 404 780 404 780 Total for 2023 37,405 125,918 163,)23 Total for 2022 35,330 109,742 145 072 Total expenditure In addition to the expenditure analysed above. the￿ are also governance costs of £780 (2022 - £720) which relaÉ¢ dir¢¢tly to charitable activities. See note 8 for fLth¢r d¢tsAIs. Page 17 Paragon Studios Ltd Notes to the Financial Statements for the Year Ended 31 May 2023 8 Attalysis of govenjance and support eosts Governanc¢ costs Restyitted funds Tot21 funds Independent examiner fees Exatnination of the financial ststements 780 780 Total for 2023 780 780 TO￿ for 2022 720 720 Page 18 Paragon Studios Ltd Notes to the Financial Statements for the Year Ended 31 Ivlay 2023 9 Net incomingloutgoing resources Net incoming resources for the year imclude: 2023 2022 Depreciation of fix¢d assets 404 404 .10 Trustees remuneration and ¢xp¢nses No trustees, nor any peTsons COFmected with them, have received any Trmuneration fiDm the charity during the year. No trustees ha￿ received any reimbursed expenses or any other benefits from the charity during the year. I I Independent ex2miner's remunerntion 2023 2022 Examination of the fjnancial statfflnents 780 720 12 Taxation The charity is a registerod charity and is therefore exempt from taxation. 13 Tangible fixed assets Furniture and equipment Total Cost At l June 2022 3,516 3,516 At 31 May 2023 3.516 3,516 Depreciation At l June 2022 Charge for the year 2.101 404 2,101 At 31 May 2023 2,505 2,505 Net book value At 31 May 2023 K,oJ i At 31 May 2022 1,415 1.415 Page 19 Paragon Studios Ltd Notes to the Financial Statements for the Year Ended 31 May 2023 14 C98h and cash equlvalents 2023 2022 C2sh at bank 71.655 70.156 15 Creditors: amouut$ falling due within one year 2023 2022 AeCD￿lS 720 7?0 16 Funds Balance at 31 May 2023 Balanee at I June 2022 Incoming resources Resources expended Trgnsfers Unrestrieted GeNeral UnTestricted 12,027 38,099 (37,405) (9) 12.712 Restricted Arts Council Nt B¢lfast City Council University of Ulstsr Freelands British Council The Ma Esme Mitchell Elephant Trust Cavehill Primary S¢hwl 6,969 6,000 18,881 13.627 21,919 62,892 (8,650) (12,768} (19,033) (58,992) (23,149) {317) 17.200 6,859 3,204 11.640 12,148 7,740 35.297 2,500 6.000 2.000 1,000 6.000 (2,072) (937 72 (63) Total restricted 58,824 126,)19 (125,918 59,234 Total thnds 70,851 164.418 (163,323) 71,946 Page 20 Paragon Studios Ltd Notes to the Financial Statements for the Year Ended 31 May 2023 Balance at J Jllne 2021 Incoming resources Resources expended Balance at 31 May 2022 Urtr&8tricted funds GeneTtsI Unrestricted 9,610 37,746 (35,329) 12,027 Restricted Arts Council Nl B¢lfast City Council Unive￿ity of Ulster. Freelands British Council The Mac 6,854 6.000 318 12,498 16,000 (15,885) 6.969 6,000 318 7,740 35.297 2,500 89,100 35.297 2,500 (93.858) Total restrieted funds 25.670 142,897 (109.743) 58,824 Total funds 35,280 180,643 {145.072) 70,851 Page21