The Trustees present their report and financial statements for the year ended 30 September 2020.
The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the financial statements and comply with the Company's Memorandum and Articles of Association , the Companies Act 2006 and “Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)” (as amended for accounting periods commencing from 1 January 2016)
The objective of the Company is the advancement of education and the arts for the benefit of the public by providing access to the works of Feliks Topolski and the works of other artists associated with his life.
The Company originally set about meeting this objective by laying out detailed plans to restore and re-present Feliks Topolski’s Memoir of the 20th Century (“the Memoir”), refurbish the railway arches under Hungerford Railway Bridge (“the Arches”) in which it is displayed, and having done so, open the exhibit to the general public. This was achieved when the Topolski Century opened to the public on 7th January 2009. In August 2010, the Directors took the decision to close Topolski Century temporarily to the public in order to preserve modest cash resources against a backdrop of poor visitor numbers and consequent low revenues. In September 2013, formal agreement was reached with the Company of Cooks to operate a café in the Arches, with the Company receiving a percentage of the café’s revenues. The first revenue from this source was received by the Company in April 2014. The agreement includes provision for paintings from the Memoir to be displayed in the café, on a rotating basis, thus ensuring that the Memoir remains on display to the public.
The Company also expanded and developed the Company’s cultural and artistic activities in the newly refurbished Topolski’s Studio (“the Studio”) housed in a separate arch under Hungerford Railway Bridge just to the north of the Arches; making use of the Memoir paintings not on display in the Arches, which are stored in the Studio, in that context. As explained in the following section, this activity has ceased temporarily.
Employees and volunteers
The Company operated without employees during the period, with Trustees taking care of administration.
As indicated last year, the sharp increase in the rent associated with the head lease reduced the Topolski Café revenues to nil during the course of the year, even before the effects of Coronavirus closures were felt. Accordingly, during 2019, the information officer’s cultural and educational activities were wound down and the information officer herself ceased employment. All activity beyond display of the artwork in the café, when possible in the light of Coronavirus restrictions, has ceased until revenues resume or alternative funding is identified.
In the period covered by these financial statements, the Company recorded total grants and donations, including Gift Aid, of £Nil (2019: £Nil). Income from displaying artwork, education coursework and sundry other income was £Nil ( 2019: £ 17, 726). Total operating expenditure in the period amounted to £27,198 (2019: £51,956). The net movement in funds for the period was, therefore, an outflow of £27,198 (2019: £34,230), resulting in cumulative reserves of £179,176 ( 2019: £206,374), which is principally made up of capitalised assets. Cognisant of this, the Directors and Trustees have sought to deploy assets in a cash generative manner by the arrangement of the café operation. The Company does not have a specific reserves policy.
At the year end, the Company held cash balances of £1,038 (2019: £6,952) and recorded net current liabilities of £ 31 8,977 (2019: £317,949).
Plans for the future
There remains little prospect of a resumption of payments from the café operation until renegotiation of the agreement with the café operators in 2023. Even at this point, the outlook remains uncertain because there is a further renegotiation of Southbank Centre’s lease in 2022. In addition, uncertainties surround the viability of the café operation itself while the Coronavirus pandemic persists.
Expenditure will, therefore, continue to be no more than the small amounts required to ensure that the artwork continues to be displayed for the benefit of the public. Even these modest levels of expenditure may require support from other sources, which the Directors will investigate. The Directors will continue to keep the situation under review, and will investigate alternative larger sources of funding with the aim of resuming former operations at a later date.
Topolski Memoir Limited (company number: 05081621 and charity number: 1103516) is a company limited by guarantee which does not have any share capital and is governed by its Memorandum and Articles of Association. The principal and registered office address is 158 Hungerford Arches, Concert Hall Approach, Waterloo, London, SE1 8XX. Details of rules concerning members, appointment of Directors and Trustees and board composition are set out in the Company’s Articles of Association, a copy of which can be obtained from the registered office of the charity. All new Trustees are monitored by the board and training given where necessary as to their responsibilities as Trustees.
The Trustees, who are also the directors for the purpose of company law, and who served during the year were:
The Company now has no current source of revenues. Although expenditure has been reduced to a minimum, there is a risk that cash resources will be depleted before café revenues resume or alternative funding is secured. The principle longer-term risk to which the Company is exposed remains that the operation is insufficiently profitable in the medium term to repay the significant short-term funding support which has been supplied by the Southbank Centre. The Company’s agreement with the Southbank Centre provides that there is no recourse to the Company for these ‘carried’ cash costs in the event that revenues from the café operation are insufficient to allow for them to be recovered. However, if café revenues are sufficient, the Southbank Centre is able to recover the ‘carried’ costs.
The sections entitled ‘Achievements and performance’, ‘Plans for the future’ and ‘Financial review’ explain the financial developments in the commercial operation and how the Directors and Trustees are addressing the risks highlighted here. In relation to risk assessment, given the size of the Company and its financial circumstances, the Directors consider that the key risks are appropriately considered on a continuing basis through on-going dialogue and monitoring of the cash position. The Directors recognise that the consideration of fraud risk is, in principle, particularly important. Wherever possible the Directors have sought to institute appropriate controls and segregation of duties to mitigate the risk of fraud. The risk of petty cash being misappropriated at present is, in the opinion of the Directors, low and there are no other sources of significant fraud risk that the Directors have identified.
The Trustees have assessed the major risks to which the Company is exposed and are satisfied that systems are in place to mitigate exposure to the major risks .
The Trustees, who are also the directors of Topolski Memoir Limited for the purpose of company law, are responsible for preparing the Trustees' Report 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 Company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that year.
In preparing these financial statements, the Trustees are required to:
- select suitable accounting policies and then apply them consistently;
- observe the methods and principles in the Charities SORP;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in operation.
The Trustees are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial position of the Company 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 Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The trustees' r eport was approved by the Board of Trustees.
The statement of financial activities includes all gains and losses recognised in the year.
All income and expenditure derive from continuing activities.
Topolski Memoir Limited is a private company limited by guarantee incorporated in England and Wales. The registered office is 158 Hungerford Bridge, Concert Hall Approach, Waterloo, London, SE1 8XX.
The accounts have been prepared in accordance with the Company's Memorandum and Articles of Association, the Companies Act 2006 and “Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)” (as amended for accounting periods commencing from 1 January 2016). The Company is a Public Benefit Entity as defined by FRS 102.
The Company has taken advantage of the provisions in the SORP for charities applying FRS 102 Update Bulletin 1 not to prepare a Statement of Cash Flows.
The financial statements are prepared in sterling , which is the functional currency of the Company. Monetary a mounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
Significant expenditures ceased in August 2019 when the Company's employee departed and information and education activities ceased. Cash resources are sufficient for the expenditure required to ensure that the artwork is displayed, and the agreement between Southbank Centre and the Company specifies that money owed to Southbank Centre is only repayable in the event that the Company has sufficient resources to do so.
The Directors and Trustees have concluded, therefore, that it remains appropriate to prepare these financial statements on the basis that the Company and charity remains a going concern. These financial statements do not include any adjustments that would result from the going concern basis of preparation being inappropriate.
Unrestricted funds are available for use at the discretion of the Trustees in furtherance of their charitable objectives.
Designated funds comprise funds which have been set aside at the discretion of the Trustees for specific purposes.
Restricted funds are subject to specific restrictions on their expenditure imposed by the donor.
Liabilities are recognised as resources expended once there is a legal or constructive obligation committing the Company to the expenditure. Resources expended are included in the Statement of Financial Activities on an accruals basis net of VAT.
Costs of generating funds comprise the costs associated with attracting voluntary income and other income.
Governance costs include those costs associated with meeting the constitutional and statutory requirements of the charity.
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rates calculated to write off the cost less estimated residual value of each asset over its expected useful life .
Fixed assets are depreciated on a straight line over the following periods:
The Company holds, as trustee, the artwork of Feliks Topolski comprising his Memoir of the Century. The previous trustee was the Southbank Centre and in the event of the Company ceasing to trade, the custody of artwork will revert, under trust, to the Southbank Centre. The Company has no authority, as trustee, to dispose of the artwork.
The Company places no value on the artwork in these financial statements due to the inherent uncertainty in determining a reliable and supportable market based value. No consideration was paid to the Southbank Centre when the Company took over the artwork as trustee and in addition, there is no track record of earned income deriving from the artwork which would allow the Directors and Trustees to impute a value from discounted projected cash flows.
The Company has no plans to acquire additional heritage assets.
Cash and cash equivalents include cash in hand, deposits held at call with banks and other short-term liquid investments with original maturities of three months or less .
The Company 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 Company's balance sheet when the Company 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.
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, including creditors and bank loans are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future p aymen ts 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 recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the Company’s contractual obligations expire or are discharged or cancelled.
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 Company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Assets acquired under finance leases are capitalised and the outstanding future lease obligations are shown in creditors.
Rentals payable under operating leases, including any lease incentives received, are charged as an expense on a straight line basis over the term of the relevant lease.
Transactions in foreign currencies are recorded using the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated using the contracted rate or the rate of exchange ruling at the balance sheet date and the gains or losses on translation are included in the Statement of Financial Activities.
Display artwork
Bookkeeping
Bank charges
Insurance
Educational expenses
Office expenses
IT and software costs
None of the trustees (or any persons connected with them) received any remuneration during the year (2019 - £Nil).
The average monthly number of employees during the year was:
The Company did not generate a taxable profit in the year (2019 - £Nil).
Leasehold Improvements
In the year ended 30 September 2013, the charitable company surrendered its 30 year underlease with the Southbank Centre in respect of 150/152 Hungerford Bridge, Concert Hall Approach, Waterloo, London, SE1 8XU in order that Company of Cooks could take an underlease for a ten year period with Southbank Centre for the property and operate a café on the site.
These financial statements continue to disclose Leasehold Improvements for 150/152 Hungerford Bridge, which are shown at a net book value as at 30 September 2020 of £498,153 (2019 - £524,323), although strictly the Company no longer has legal title to the property. However, the current tenant's underlease with the Southbank Centre for this property cannot be varied during its term without the express written permission of the charitable company which also has the unconditional right to take an underlease on the property at the end of the ten year period or before, if the lease terminates. On this basis, although the charitable company no longer has legal title of the property, the directors consider that the carrying value of Leasehold Improvements remains appropriate and should continue to be depreciated in accordance with current policy, given the continuing economic benefit in the form of future income streams arising to the charitable company from the property. The directors will continue to review the position annually.
At the reporting end date the Company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
The Company's future rental commitment to the Southbank Centre was formally extinguished during the accounting year ended 30 September 2013 on the surrender of its underlease with the Southbank Centre at 150/152 Hungerford Bridge, Waterloo, London, SE1 8XU (see note 7).
There were no disclosable related party transactions during the year (2019 - none).