The trustees present their annual report and financial statements for the year ended 31 August 2023.
The accounts have been prepared in accordance with the accounting policies set out in note 1 to the accounts and comply with the charity'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) (effective 1 January 2019)”
The charity’s objects, as set out in its Memorandum and Articles of Association, included the provision of a first class education based on Christian principles, and to build Christian character and leadership rooted in Biblical teaching.
Despite the closure of the school ,the trustees will continue to operate the charity and utilise its assets in line with the objects and are considering a wide range of future alternative ways of doing so.
The trustees have and will continue to pay due regard to guidance issued by the Charity Commission in deciding what activities the charity should undertake. The trustees have taken legal, surveying and accountants advice at all material times to ensure that they continue to act within the objects of to ensure that they continue to act within the objects of the charity.
WIth the school closing in 2020 the trustees have been focused on raising funds from the rooms and facilities of the charity as a temporary measure whilst exploring other options including the sale of land and buildings. These efforts are ongoing.
The results for the year show a deficit of £97,702 (2022: surplus of £103,115).
Total income for the year was £160,972 (2022: £371,063) which included £160,972 (2022: £159,195) in respect of the hiring of school facilities, £nil (2022: £100,000) income from the write off of an historical loan balance which the Trustees consider is no longer repayable and £nil (2022: £111,868) in respect of coronavirus job retention scheme grants received in the period.
Total expenditure for the year was £258,674 (2022: £267,948).The main expenditure of the charity was that of staff salaries and property related costs, including utilities, repairs and maintenance.
As previously reported, based on the falling numbers, the trustees took the decision to close the school in 2020.
The trustees are currently reviewing the long term reserves policy of the charity.
The trustees are currently considering the long-term plan for the charity which will be in accordance with its stated objects. This includes looking to partner with other organisations to explore new opportunities to ensure Kingsmead continues its long history of serving children, young people and the local community.
Kingsmead School is a registered charity and is incorporated under the Companies Act 2006 as a company limited by guarantee. It operates under the Memorandum and Articles of Association dated 5 August 1966.
The Board of Governors governs the policy of the charity. All governors give of their time freely and no remuneration was paid in the year. The trustees will review the structure, governance and management of the charity going forward.
The trustees, who are also the directors for the purpose of company law, and who served during the year and up to the date of signature of the financial statements were:
New governors are elected at a meeting of the Board of Governors. It is the responsibility of the Board to ensure that the appointment of governors provides the full range of abilities and skills which are needed to ensure the effective governance of the charity.
This report has been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.
The trustees' report was approved by the Board of Trustees.
I report to the trustees on my examination of the financial statements of Kingsmead School Hoylake Trust Limited (the charity) for the year ended 31 August 2023.
As the trustees of the charity (and also its directors for the purposes of company law) you are responsible for the preparation of the financial statements in accordance with the requirements of the Companies Act 2006 (the 2006 Act).
Having satisfied myself that the financial statements of the charity are not required to be audited under Part 16 of the 2006 Act and are eligible for independent examination, I report in respect of my examination of the charity’s financial statements carried out under section 145 of the Charities Act 2011 (the 2011 Act). In carrying out my examination I have followed all the applicable Directions given by the Charity Commission under section 145(5)(b) of the 2011 Act.
I have completed my examination. I confirm that no matters have come to my attention in connection with the examination giving me cause to believe that in any material respect:
accounting records were not kept in respect of the charity as required by section 386 of the 2006 Act; or
the financial statements do not accord with those records; or
the financial statements do not comply with the accounting requirements of section 396 of the 2006 Act other than any requirement that the accounts give a true and fair view which is not a matter considered as part of an independent examination; or
the financial statements have not been prepared in accordance with the methods and principles of the Statement of Recommended Practice for accounting and reporting by charities applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).
Kingsmead School Hoylake Trust Limited is a private company limited by guarantee incorporated in England and Wales. The registered office is Bertram Drive, Hoylake, Wirral, CH47 0LL.
The financial statements have been prepared in accordance with the charity'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) (effective 1 January 2019)". The charity is a Public Benefit Entity as defined by FRS 102.
The charity 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 charity. Monetary amounts 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.
Despite the closure of the school in 2020 the trustees continue to operate the charity in line with the objects and utilise the assets of the charity to achieve these objectives. 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. Thus the trustees continue to adopt the going concern basis of accounting in preparing the financial statements.
Unrestricted funds are available for use at the discretion of the trustees in furtherance of their charitable objectives.
Cash donations are recognised on receipt. Other donations are recognised once the charity has been notified of the donation, unless performance conditions require deferral of the amount. Income tax recoverable in relation to donations received under Gift Aid or deeds of covenant is recognised at the time of the donation.
Donations, legacies and other forms of voluntary income are recognised in the statement of financial activities as incoming resources when receivable, except insofar as they are incapable of financial measurement.
Fee income is shown in the financial statements on a reasonable basis and is shown gross of bursaries and scholarships. Bursaries and scholarships are included within resources expended in the course of charitable activities. Fee income received in advance of the commencement of the school term is treated as a liability.
Income from fundraising and lettings is recognised as an incoming resource when receivable, with hiring out of facilities classified as trading income.
Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement, and the amount of the obligation can be measured reliably.
Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs which contribute to more than one activity and support costs which are not attributable to a single activity are apportioned between those activities on a basis consistent with the use of resources. Central staff costs are allocated on the basis of time spent, and depreciation charges are allocated on the portion of the asset’s use.
Resources expended are accounted for on an accruals basis and are recognised when there is a legal or constructive obligation to pay.
Resources expended have been classified under headings that aggregate all costs related to that
category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with use of resources.
All expenditure is inclusive of VAT as the school is not VAT registered.
Costs of generating voluntary income comprises the costs associated with attracting donations and grants.
Charitable expenditure comprises direct expenditure in the furtherance of the charitable company's objectives.
Governance costs are the costs associated with the governance arrangements of the charitable company which relates to the general running of the charitable company as opposed to those costs associated with fundraising or charitable activity. Included within this category are costs associated with the strategic as opposed to day-to-day management of the charitable company's activities, those incurred in the governance of its assets and are associated with constitutional and statutory requirements.
Support costs, which are incurred directly in support of expenditure on the objects of the charitable company, include the functions such as general management, finance, human resources and premises, and are allocated across the categories of charitable expenditure. The basis for allocation has been explained in the notes to the financial statements.
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:
Freehold land is not depreciated.
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 the statement of financial activities.
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).
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in income/(expenditure for the year, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately, unless the relevant asset is carried in at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell.
Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
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 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.
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.
Financial assets, other than those held at fair value through income and expenditure, are assessed for indicators of impairment at each reporting date. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in net income/(expenditure) for the year.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in net income/(expenditure) for the year.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the charity transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
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 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 recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the charity’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 charity 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.
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.
Impairments are recognised where the trustees believe that there is an indication of impairment. They are recognised where the carrying amount of an asset exceeds its recoverable amount. The timing and quantum of any impairment is a matter of management judgement.
The trustees review the carrying amount of receivables on a regular basis to identify items where recoverability may be in doubt. The timing and quantum of any impairment of receivables is a matter of management judgement.
Grants receivable for core activities
Grants receivable for core activities includes £nil (2022: £111,868 ) in respect of coronavirus job retention scheme grants.
Hire of school facilities
In 2022, the trustees reviewed the agreement of a loan in the sum of £100,000 received in 2017 and concluded that the loan monies are no longer repayable. They therefore brought this into unrestricted funds under other income in the 2022 period.
Governance costs includes payments to the Independent Examiner of £3,500 (2022: £3,500) for the independent exam.
No trustees received reimbursed expenses (2022: One trustee was reimbursed £5,188).
The average monthly number of employees during the year was:
The remuneration of key management personnel is as follows.
Kingsmead School Hoylake Trust Limited is a registered charity and is thus exempt from tax on income and gains falling within sections 466 to 493 of the Corporation Tax Act 2010 and section 256 of the Taxation of Chargeable Gains Act 1992 to the extent that these are applied to charitable objects. No tax charges have arisen in the charitable company.
All land and buildings are freehold. Land and buildings includes £21,537 in respect of land which is not depreciated.
In 1966, the original properties of Kingsmead School and surrounding playing fields were donated to the school by the former headmaster, Mr Watts, and are therefore excluded from the above figures. The costs incurred in ascertaining the value of the properties at that time would outweigh any benefit to the financial statements. During the period ended 31 August 2020 some of the donated land was sold for £1.6m.
All tangible fixed assets are held for use by the charitable company.
An impairment loss of £4,879 (2022: £4,989) has been recognised against trade debtors.
The unrestricted funds of the charity comprise the unexpended balances of donations and grants which are not subject to specific conditions by donors and grantors as to how they may be used.
At the reporting end date the charity had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Following the school closing in 2020 the trustees have been focused on raising funds from the rooms and facilities of the charity whilst exploring other options.
At the reporting end date the charity had contracted with tenants for the following minimum lease payments:
Disclosures regarding trustee remuneration, trustee expenses and key management remuneration are disclosed earlier in the notes to the accounts.
There were no additional disclosable related party transactions during the year (2022 - none).