The Trustees present their annual report and financial statements for the year ended 30 November 2023.
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 Charity's [governing document], the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 (as amended) 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).
To advance the wellbeing and development of the community of Scalloway.
To advance the enhancement and conservation of the local environment, culture, and heritage in Scalloway.
To advance the education of the public in matters relevant to the community of Scalloway
The Trustees have paid due regard to guidance issued by the Charity Commission in deciding what activities the Charity should undertake.
The highlight of the year has undoubtedly been the full opening of the Scalloway Caravan Park and the award of a 5-star facility rating by Visit Scotland – the only one in Shetland. Various delays outwith the charity’s control meant that the site only opened to the public in May 2023. It has proved popular with the public.
In 2018 the Scalloway Community Council began a process called ReCreate Scalloway to engage the public in bringing forward a vision for the future development of Scalloway. The Feasibility Study & Masterplan was handed over from Ironside Farrar in Dec ember 2022 and since then we have sought to engage with the key stakeholders, potential delivery partners, and crucially, look at how projects can attract funding.
Our focus has been on the number one priority, the Waterfront Phase 1, with discussions with key partners, principally SIC. We are now moving forward with commissioning of more detailed design work, including technical specification and consenting requirements, land ownership, detailed costings for funding bids and any tender preparations that can be progressed.
We have had some unfortunate difficulties with staffing our Development Worker position this year, as sadly our worker had to leave us due to health-related issues in early 2023. We had further difficulties in recruiting, however we successfully appointed 2 part time Development Workers in July 2023, who have since been able to pick up the core workstreams and move project plans forward. In the interim we were able to get a one day a week support from a further worker.
There has been evidence of ongoing need for support due to cost of living pressures in the community. We successfully bid for £3,000 from the Corra Fund for cost of living support. We have been rolling this out, in a similar fashion to last year, based on people being referred through a variety of service partners, such as health visitors.
We are currently pursuing an opportunity to buy premises that can be converted into a multi-functional space for Community groups and businesses, with office and meeting space and some hot desking capacity. We are keen to hear about interest and demand for this within the community. We hope to progress this project quickly and have something underway in 2024.
We also pursuing a number of other projects in relation to access improvements, footpaths, heritage, community transport, and energy
It is the policy of the Charity 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 operational expenditure. This has proved difficult because the majority of the charity’s income is from grants which are paid in arrears. The charity has been financed by an interest free loan from the Shetland Charitable Trust which bridges the funding gap. As all projects are fully funded only a small part of the charity expenditure needs to be met from unrestricted income.
The charity incurred a deficit in operations in previous years due to grant funding only being receivable after expenditure has been incurred. The completion of the Scalloway Caravan Park has released grant income to cover the previous deficit incurred during the development. A loan of £400,000 was obtained from the Shetland Charitable Trust to enable the charity to bridge the gap between expenditure being incurred and grant being received to enable it to pursue its objectives. The receipt of grant monies allowed us to repay £300,000 in the financial year and the balance of £100,000 was paid off in 2024.
In future income from the Scalloway Caravan Park will contribute to the running costs of SCDC.
The Trustees have assessed the major risks to which the Charity is exposed, and are satisfied that systems are in place to mitigate exposure to the major risks.
The Charity is a company limited by guarantee.
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:
Membership
Membership is open to anyone aged 16 and over who is supportive of the aims of the organisation, regardless of where they are resident.
The Trustees report was approved by the Board of Trustees.
I report on the financial statements of the Charity for the year ended 30 November 2023, which are set out on pages 4 to 15.
The Charity’s Trustees, who are also the directors of Scalloway Community Development Company Ltd for the purposes of company law, are responsible for the preparation of the financial statements in accordance with the terms of the Charities and Trustee Investments (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006. The Trustees consider that the audit requirement of Regulation 10(1)(a) to (c) of the 2006 Accounts Regulations does not apply. It is my responsibility to examine the financial statements as required under section 44(1)(c) of the Act and to state whether particular matters have come to my attention.
My examination is carried out in accordance with Regulation 11 of the 2006 Accounts Regulations. An examination includes a review of the accounting records kept by the charity and a comparison of the financial statements presented with those records. It also includes consideration of any unusual items or disclosures in the financial statements, and seeks explanations from the trustees concerning any such matters. The procedures undertaken do not provide all the evidence that would be required in an audit and consequently I do not express an audit opinion on the view given by the financial statements.
In connection with my examination, no matter has come to my attention:
to keep accounting records in accordance with section 44(1) (a) of the 2005 Act and Regulation 4 of the 2006 Accounts Regulations; and
to prepare financial statements which accord with the accounting records and comply with Regulation 8 of the 2006 Accounts Regulations;
to which, in my opinion, attention should be drawn in order to enable a proper understanding of the financial statements to be reached.
The statement of financial activities includes all gains and losses recognised in the year. All income and expenditure derive from continuing activities.
Scalloway Community Development Company Ltd is a private company limited by guarantee incorporated in Scotland. The registered office is .
The financial statements have been prepared in accordance with the Charity's governing document, the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 (as amended), FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the Charities SORP "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 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.
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.
Restricted funds are subject to specific conditions by donors or grantors 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.
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.
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.
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 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).
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.
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.
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.
Grants
Pitch hire
Project costs
Adverts
Development worker costs
Bank charges
Meeting hire
Subscriptions
Grant underspent returned
Utilities
Sundries
Booking charge
Insurance
Repairs
Wardens wages
The average monthly number of employees during the year was:
The charity is exempt from taxation on its activities because all its income is applied for charitable purposes.
The restricted funds of the charity comprise the unexpended balances of donations and grants held on trust subject to specific conditions by donors as to how they may be used.
SCARF Fund - development of Scalloway caravan park
Supporting Community Fund - providing financial assistance to needy families in Scalloway
Recreate Scalloway Fund - promoting community dialogue on the role and future of the village, producing documents that help guide the future development of Scalloway
Town Centre Fund - improvements to the Scalloway environment
Development Fund - employment of development worker
Friendship Agreement Fund - event for visitors representing the Oygarden Kommune in west Norway
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. These include designated funds which have been set aside out of unrestricted funds by the trustees for specific purposes.
There were no disclosable related party transactions during the year (2022 - none).