The directors present their report and financial statements for the year ended 31 May 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 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) (effective 1 January 2019)".
The company's object ives are to promote regeneration for the benefit of the public in areas of social and economic deprivation (and in particular in the Stewartstown Road area of Belfast) by all or any of the following means:
a) the advancement of education training or retraining;
b) the promotion and support of social or individual enterprise;
c) the creation of training and employment opportunities by the provision of workspace buildings and/or land;
d) the provision or promotion of housing for those who are in need;
e) the promotion of social cohesion equality diversity and cross-community activity.
The Company believes that it has continued to achieve its goals including:
the maintenance of an environment which is attractive, vibrant, economically active, and supportive of other regeneration initiatives;
the maintenance of shared space that is respecting of diversity and where members of the public can feel secure, accepted, confident, and positive.
56% of the company's available space is provided for charitable and voluntary sector entities, 5% for community directed state agencies (Surestart), and 39% for commercial tenants.
Throughout the financial year occupancy was at 100%.
During the year the charity makes donations to local community forums in line with it's charitable objectives and public benefit guidelines.
The results are set out in detail on pages 8 to 18. The company returned outgoing resources for the year of £ 52,384 (201 9 - net outgoing resources £27,317 ). At 31 May 20 20 , the level of unrestricted reserves held was £ 1,459,290 (201 9 : £1 ,511,674 ) and the level of restricted reserves held was £8,000 (2019 - £8,000).
The results of the charity have been impacted by expense charges in relation to exceptional bad debt provisions of £27,622 (2019 - £9,527) in relation to arrears owing from a tenant. The directors and charity are taking all available legal action against the tenant for the full recovery of the outstanding arrears, and continue to actively pursue the recovery of the debt in full. However, the directors consider it prudent to provide for the debt while legal action is ongoing, as at the time of signing the financial statements it has not been possible to determine an outcome to the ongoing legal action.
It is the policy of the company that unrestricted funds which have not been designated for a specific use should be maintained at a level equivalent to between three and six month’s expenditure. The directors consider that reserves at this level will ensure that, in the event of a significant drop in funding, they will be able to continue the company’s current activities while consideration is given to ways in which additional funds may be raised. This level of reserves has been maintained throughout the year.
The directors 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.
Impact of Covid-19
A comprehensive operational plan was implemented to minimise the likelihood of acquiring Covid infection within SRRP's premises. A building supervisor was redeployed temporarily in the role of guardian to enable compliance with Covid safe operating procedures. This has allowed essential and critical cross-community services to continue for residents of Suffolk and Lenadoon. These services include; South-West Belfast Foodbank, Lenadoon Community Counselling Service, Outer West Surestart, Kids Together Belfast, Suffolk Community Forum and Cloona Child Contact Centre. These organisations have continued to provide services to the local area at a time when they are needed most.
The board adopted a sympathetic approach to financial difficulties experienced by the charity's tenants, making allowances for those who have faced enforced closure or severe restriction in their ability to operate. In common with many charitable businesses, SRRP has been financially impacted by the Covid pandemic . However, it has resources available and will continue to work with key stakeholders and tenants taking all necessary steps to mitigate risks where possible. The directors are very positive in being able to navigate successfully through these challenges.
The company is a company limited by guarantee and a registered charity for taxation purposes.
The directors who served during the year and up to the date of signature of the financial statements were:
The Board of Directors of the Company shall consist of not less than 10 nor more than 14 members. The Directors shall have power at any time to appoint any person as an addition to the existing Directors but the number shall not at any time exceed the number fixed in accordance with the Articles. Such appointments will be subject to ratification by Members at the next General Meeting.
The Board shall consist of:
1. A minimum of 3 and a maximum of 5 people representing Lenadoon Community Forum
2. A minimum of 3 and a maximum of 5 representing Suffolk Community Forum
3. A minimum of 2 and a maximum of 5 people who are appointed for their professional expertise, and who may not be members of the Forum or local residents.
One third of Directors shall resign in each year at the Annual General Meeting and will be eligible for re-election. The Directors to retire in each year shall be those who have been longest in office since their last election, but between persons who became Directors on the same day, those to retire shall be determined by lots.
The directors, who also act as trustees for the charitable activities of Stewartstown Road Regneration Project Limited, are responsible for preparing the Directors' 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 directors 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 directors are required to:
- select suitable accounting policies and then apply them consistently;
- observe the methods and principles in the Charities SORP 2019 (FRS 102) ;
- 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 directors 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 directors' r eport was authorised & approved by the Board of Directors.
Opinion
We have audited the financial statements of Stewartstown Road Regeneration Project Limited (the ‘company’) for the year ended 31 May 2020 which comprise the statement of financial activities, the statement of financial position and the 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, 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:
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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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.
the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
Other information
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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 there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
In our opinion, based on the work undertaken in the course of our audit:
the information given in the directors' Report, which includes the d irectors’ r eport prepared for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the d irectors’ r eport included within the directors' r eport has been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the d irectors’ r eport included within the directors' r eport.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
we have not received all the information and explanations we require for our audit; or
the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies’ exemptions in preparing the directors' r eport and from the requirement to prepare a s trategic r eport.
As explained more fully in the s tatement of directors' r esponsibilities, the directors 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 directors 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 directors are responsible for assessing the 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 directors either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an 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 taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the 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 to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
The statement of financial activities includes all gains and losses recognised in the year.
All income and expenditure derive from continuing activities.
Stewartstown Road Regeneration Project Limited is a private company limited by guarantee incorporated in Northern Ireland. The registered office and place of business is 124 Stewartstown Road, Belfast, BT11 9JQ.
The financial statements have been prepared in accordance with the Charities' 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) (effective 1 January 2019)". The charity 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.
At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
COVID 19
At the time of approving these financial statements the charity continues to operate within a global pandemic which has been declared due to the outbreak of coronavirus. The government has announced some substantial measures to assist businesses through this period and the charity will avail of such support when required. At the time of approving the financial statements the committee members have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future.
Unrestricted funds are available for use at the discretion of the directors in furtherance of their charitable objectives.
Designated funds comprise funds which have been set aside at the discretion of the directors for specific purposes. The purposes and uses of the designated funds are set out in the notes to the financial statements.
Restricted funds are subject to specific conditions by donors as to how they may be used. The purposes and uses of the restricted funds are set out in the notes to the financial statements.
Expenditure is recognised on an accruals basis as a liability is incurred.
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in net income/(expenditure) for the year.
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
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.
The charity contributes to the personal pension scheme of its employees. The pension charge represents the amounts payable by the charity in respect of the year.
In the application of the company’s accounting policies, the directors 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.
The annual depreciation charge on fixed assets depends primarily on the estimated lives of each type of asset and estimates of residual values. The directors regularly review these assets lives and change them as necessary to reflect current thinking on remaining lives in light of prospective economic utilisation and physical condition of the assets concerned. Changes in assets lives can have a significant impact on depreciation charges for the period. Detail of the useful lives is included in the accounting policies.
Judgements are made in relation to allocation of income and expenditure to restricted and unrestricted funds. The committee members consider it appropriate to allocate these funds based on interpretation of donations received.
Rental & service charge income
Solar panel income
Rates
Light & heat
Repairs & maintenance
Printing, postage and stationery
Telephone
Directors meeting costs
Legal & professional
Bank charges
Sundry expenses
Staff expenses
Audit fees
Bad & doubtful debts
The bad and doubtful debt provision of £27,622 (2019 - £9,527) is considered to be exceptional and relates to arrears owing from a tenant. The directors and charity are taking all available legal action against the tenant for the full recovery of the outstanding arrears, and continue to actively pursue the recovery of the debt in full. However, the directors consider it prudent to provide for the debt while legal action is ongoing, as at the time of signing the financial statements it has not been possible to determine an outcome to the ongoing legal action.
Description of charitable activities
Promoting regeneration for the benefit of the public in areas of social and economic deprivation
The average monthly number of employees during the year was:
No employees had employee benefits in excess of £60,000 (2019 - none).
Community Regeneration Fund
Funds received to enable local community regeneration.
The Stewartstown Road Regeneration Project Limited Board of Directors at the end of the financial year 2019 agreed to designate £5,000 from unrestricted reserves to cover renovation works for the building.
Unrestricted
Restricted
Unrestricted
Restricted
In prior years the company received various restricted funds in relation to the development of the company's property. The conditions specified by the donors were met and therefore the related funds have been classed as unrestricted. The terms of the grants include a clawback of a proportion of the grant, should the related property be sold within a given time period. The end of these contingency periods was February 2018.
In addition, one of the funders has acquired a mortgage on the company's property for a period of 1,000 years from 2006.
In 2001, the Northern Ireland Housing Executive put in place a lease on the property held at 124 Stewartstown Road, for a term of 99 years. One of the conditions of this lease is that the premises is to be used for community development for the period of the indenture.
At the time of approving these financial statements impact of the Covid-19 global pandemic and the impact of national lockdowns is having a serious affect on the operations of the charity, its tenants and key stakeholders.
The government has announced some substantial measures to assist businesses through this period and the charity will work together with its key stakeholders and tenants to provide a solution which will be beneficial for all parties involved. At the time of approving the financial statements the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future.
Several of the charity's directors are involved in the following local community groups:
Suffolk Community Forum
Lenadoon Community Forum
During the year ended 31 May 2020 the charity made the following donations to these groups:
Suffolk Community Forum £20,000 (2019 - £14,000)
Lenadoon Community Forum £20,000 (2019 - £14,000)