REGISTERED COMPANY NUMBER: |
REGISTERED CHARITY NUMBER: |
Report of the Trustees and |
Unaudited Financial Statements for the Year Ended 31st December 2023 |
for |
Palcrafts (UK) Limited |
REGISTERED COMPANY NUMBER: |
REGISTERED CHARITY NUMBER: |
Report of the Trustees and |
Unaudited Financial Statements for the Year Ended 31st December 2023 |
for |
Palcrafts (UK) Limited |
Palcrafts (UK) Limited |
Contents of the Financial Statements |
for the Year Ended 31st December 2023 |
Page |
Report of the Trustees | 1 | to | 6 |
Independent Examiner's Report | 7 | to | 8 |
Statement of Financial Activities | 9 |
Balance Sheet | 10 | to | 11 |
Notes to the Financial Statements | 12 | to | 17 |
Palcrafts (UK) Limited (Registered number: SC242506) |
Report of the Trustees |
for the Year Ended 31st December 2023 |
The trustees who are also directors of the charity for the purposes of the Companies Act 2006, present their report with the financial statements of the charity for the year ended 31st December 2023. The trustees have adopted the provisions of 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). |
OBJECTIVES AND ACTIVITIES |
Objectives and aims |
The objects of the charity are to: |
- Relieve poverty in Palestine, primarily the West Bank and Gaza; |
- Promote co-operation with individuals and groups in the UK in organising events of all kinds to heighten local awareness of Palestinian issues; and |
- Provide in the UK educational materials and goods from Palestinian producer groups, particularly those catering for people with special needs either physical or mental, and whose activities benefit the whole community. |
The main objectives during the year continued to be: |
- Operation of the fair-trade shop through our subsidiary company, Hadeel (UK) Limited, so providing employment and income on fair trade principles to members of producer groups in the Palestinian areas, including women's cooperative groups, craft groups in refugee camps, physically disadvantaged and other special needs groups, agricultural cooperatives etc. |
- Organising and participating in educational events and improving our educational and information materials. |
- Awarding grants to suppliers, groups and organisations in Palestine. |
Palcrafts (UK) Limited (Registered number: SC242506) |
Report of the Trustees |
for the Year Ended 31st December 2023 |
OBJECTIVES AND ACTIVITIES |
Significant activities |
Over a 2 week period in May 2023 a group of our Trustees, staff, volunteers and supporters visited Palestine and met with producers' groups and suppliers. The visit strengthened relationships, improved networking and allowed us to make orders from existing and new suppliers. The visit was, also, successful in identifying developmental needs and areas in which Palcrafts can help and support. The group visited several towns and villages in the West Bank and witnessed the conditions in which Palestinians have to live and work. Unfortunately, a visit to Gaza could not be made. |
Over the past year, Palcrafts and Hadeel took part in several community events raising awareness of the life of Palestinians under occupation and helped in the promotion of Palestinian culture in the UK. Palcrafts supported and was successful in securing funding for our sister organisation Sunbula in Jerusalem. Donations were also passed on to Rawdat El-Zohour school in Jerusalem. |
Grant making policy |
While the Directors believe that the best way to relieve poverty and improve people's welfare is to provide sustainable employment, they also see the importance of giving grants. Their criteria in making grants are |
1. Producer groups who show that they can make good use of funding to improve and expand their work, providing social benefit; |
2. Supplier groups we know and trust, whose members are suffering real distress, and individuals in exceptional cases; and |
3. Groups or organisations, usually in Palestine, which in our best judgment would use the grants for sustainable development to serve the same purposes as Palcrafts (UK) Ltd. |
Palcrafts (UK) Limited (Registered number: SC242506) |
Report of the Trustees |
for the Year Ended 31st December 2023 |
ACHIEVEMENT AND PERFORMANCE |
During the first half of the year, business was following the average of previous years with early shoots of recovery following the Covid-19 pandemic. The return of the Edinburgh International and Fringe Festivals in August provided desperately needed improvement in trading during the third quarter, but not enough to reach the desired level. By the end of September, the financial situation was less favourable and the board of directors needed to raise funds through donations and loans from the inner circle of supporters. Several thousands of pounds were raised but luckily were not used and mostly returned. During the fourth quarter of the year, the Scottish public reacted to the Middle East conflict by accelerating their buying of Palestinian goods made a huge boost to our trading position and benefited our suppliers in Palestine and our ability to support them (see charts below). |
The improvement in sales during the last 3 months of the year spanned all our trading platforms including shop sales, web sales, reps' sales and events. Palcrafts UK Limited meets the definition of a public benefit entity under FRS 102. |
The year of hope 2023 |
This report is prepared to cover activities and the annual report for the year from 1 January to 31 December 2023. The report will be presented at the AGM on 25 June 2024. During 2 weeks in May 2023 several trustees, staff members and supporters visited producer groups in Palestine in well well-organised Study Tour of Palestine. A review of the visit and a report from the delegates were presented at a public event on 26 June 2023. |
This AGM comes in the midst of the most brutal conflict facing Palestinians in Gaza and the West Bank. I would like, therefore, to acknowledge the sacrifices and the loss of life in Palestine that has mounted to over 35,000 confirmed killed (at the time of writing) as well as tens of thousands who are unaccounted for under the rubble. Over 80,000 people were injured but could not receive proper or any medical care due to the destruction of most medical facilities and hospitals. The impact of the conflict was felt sorely around the world and not least in Scotland with many of our supporters and customers expressing their outrage at the attacks and support for the victims by visiting Hadeel, making donations and buying Palestinian goods. |
The year 2023, has produced mixed fortunes for Hadeel/Palcrafts. We have seen stability in our staffing structure and the volunteer group. During her second year in post, the CBM was able to provide continuity of management and link with suppliers and customers and benefited from joining the in the visit to Palestine and meeting with producers' groups in May 2023. This has reinvigorated business relationships and networking. We have also been able to expand the pool of volunteers with a variety of backgrounds and skills. On the other hand, the start of the Middle East conflict in October brought a complete obliteration of civic life in the Gaza Strip and draconian restrictions to business, travel, exports and financial transactions to the West Bank. This situation has continued unabated at the time of writing this report with no glimpse of hope of it ending. |
FUND-RAISING AND PUBLIC EVENTS: |
During the year 2023, a group of Board members, staff, volunteers and supporters visited Palestine over 2 weeks in May 2023 and were able to make contact with old suppliers and new suppliers. The group was able to make purchases and place orders worth £5,000 on behalf of Hadeel/Palcrafts. |
Palcrafts (UK) Limited (Registered number: SC242506) |
Report of the Trustees |
for the Year Ended 31st December 2023 |
Over the past year, Hadeel has participated in several community activities in Edinburgh and Glasgow and ran stalls at such events, establishing new relationships, generating off-site sales and promoting our work to new audiences. |
We also successfully partnered and supported our sister organisation Sunbula in Jerusalem in a joint application and ensured funding of £8,064 to Sunbula from the Network for Social Change. |
During the year 2023, it was not possible to offer grants to groups and individuals in Palestine as a result of the tight budget we were working with here in Scotland. However, it is anticipated that donations will be made in 2024 not only to pass on the donations from the public but also to support suppliers. |
FINANCIAL REVIEW |
Challenges and concerns |
The charity's trading subsidiary Hadeel (UK) Limited's trading activities during 2023 have surpassed all expectations as a result of the Middle East conflict. This sudden surge in trade is linked to the events in the Middle East and therefore, it will be wise to make future plans assuming that trade will revert to its previous trend once the conflict is over. However, we need to build on the current success and try to diversify our business but within the fair-trade ethos and with Palestinian producers, small groups and cooperatives at the heart of our aims and objectives. |
FUTURE PLANS |
We are now in a better position to plan for 2024 and beyond with a stable management structure and a reliable governance policy. We are now in a good position to move forward with contracting professional Human Resources support, professional Health and Safety schemes and hopefully a robust electronic stock management system. |
STRUCTURE, GOVERNANCE AND MANAGEMENT |
Governing document |
The organisation is a company limited by guarantee, incorporated on 17th January 2003, and was granted recognition as a charity on 5th February 2003. The objects and the powers of the charitable company are established under its Memorandum of Association, and it is governed under its Articles of Association. In the event of the company being wound up members are required to contribute an amount not exceeding £1. |
Recruitment and appointment of new trustees |
The directors of the company are also charity trustees for the purposes of charity law and are known as the Council. Under the requirements of the Memorandum and Articles of Association, the directors are elected at the Annual General Meeting, with one-third retiring each year, though they may be re-elected at the next Annual General Meeting. |
The charity's principal activity is co-coordinating the work of its subsidiary undertaking, which operates a retail shop marketing goods from Palestinian producer groups on fair trade principles. The charity's aims are the relief of poverty, and to promote and educate individuals and groups in the UK by organising events to heighten local awareness of Palestinian and fairtrade issues. |
The Council seeks to ensure that these aims are appropriately reflected through the knowledge and experience of the membership of the trustee body. |
Palcrafts (UK) Limited (Registered number: SC242506) |
Report of the Trustees |
for the Year Ended 31st December 2023 |
STRUCTURE, GOVERNANCE AND MANAGEMENT |
Organisational structure |
The charity is managed by the board of directors which meets frequently throughout the year to decide on the strategic direction and policy of the charity. The board must consist of a minimum of 3 members and a maximum of 15. The management of the charity's shop is delegated to the Co-ordinator and Business Manager. |
The charity's wholly-owned subsidiary, Hadeel (UK) Limited, was established to operate commercial retail operations and its profits are gifted to the charity. |
Induction and training of new trustees |
Council members are already familiar with the practical work of the charity and conditions in the Palestinian areas. There are occasional visits by staff, council members and volunteers to our producer groups in Palestine to keep in touch with them and the social benefits they provide. An induction pack is being developed, setting out the responsibilities and obligations of trustees, the main documents, the history of the charity and details of the objectives and activities. |
Related parties |
The charity has close relationships with a number of similar organisations and groups, as well as the suppliers to the shop and beneficiaries of the grants awarded. Similar organisations include: |
Sunbula, our sister shop in Jerusalem |
The One World Shop, Edinburgh |
Zaytoun CIC, London |
Equal Exchange, Edinburgh |
Scottish Fair Trade Forum (SFTF) |
British Association for Fair Trade Shops and Suppliers (BAFTS) |
The Church of Scotland |
Social Enterprise Network Scotland |
Scottish Palestinian Forum |
Risk management |
The directors continue to assess the risks to which the charity is exposed, relating to the operations and finance of the charity. Procedures are in place to oversee all financial transactions and to ensure compliance with the health and safety of staff, volunteers, customers and visitors. The Council operates a reserves policy to be able to meet the needs of our beneficiaries as they arise. |
REFERENCE AND ADMINISTRATIVE DETAILS |
Registered Company number |
Registered Charity number |
Palcrafts (UK) Limited (Registered number: SC242506) |
Report of the Trustees |
for the Year Ended 31st December 2023 |
Registered office |
Trustees |
Company Secretary |
Independent Examiner |
S Syedain & Co |
Chartered Accountants |
First Floor |
87 Kenton Road |
Harrow |
Middlesex |
HA3 0AH |
EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
Approved by order of the board of trustees on |
Independent Examiner's Report to the Trustees of |
Palcrafts (UK) Limited |
I report on the accounts for the year ended 31st December 2023 set out on pages nine to seventeen. |
Respective responsibilities of trustees and examiner |
The charity's trustees are responsible for the preparation of the accounts in accordance with the terms of the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006 (as amended). The charity's trustees consider that the audit requirement of Regulation 10(1)(a) to (c) of the Accounts Regulations does not apply. It is my responsibility to examine the accounts as required under Section 44(1)(c) of the Act and to state whether particular matters have come to my attention. |
Basis of the independent examiner's report |
My examination was carried out in accordance with Regulation 11 of the Charities Accounts (Scotland) Regulations 2006. An examination includes a review of the accounting records kept by the charity and a comparison of the accounts presented with those records. It also includes consideration of any unusual items or disclosures in the accounts, and seeking explanations from you as 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 accounts. |
Independent Examiner's Report to the Trustees of |
Palcrafts (UK) Limited |
Independent examiner's statement |
In connection with my examination, no matter has come to my attention : |
(1) | which gives me reasonable cause to believe that, in any material respect, the requirements |
- | 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 accounts which accord with the accounting records and to comply with Regulation 8 of the 2006 Accounts Regulations |
have not been met; or |
(2) | to which, in my opinion, attention should be drawn in order to enable a proper understanding of the accounts to be reached. |
Tahira Siddiqui (Senior Statutory Auditor) |
The Institute of Chartered Accountants in England and Wales |
S Syedain & Co |
Chartered Accountants |
First Floor |
87 Kenton Road |
Harrow |
Middlesex |
HA3 0AH |
Date: ............................................. |
Palcrafts (UK) Limited |
Statement of Financial Activities |
for the Year Ended 31st December 2023 |
31.12.23 | 31.12.22 |
Unrestricted | Restricted | Total | Total |
fund | fund | funds | funds |
Notes | £ | £ | £ | £ |
INCOME AND ENDOWMENTS | FROM |
Donations and legacies |
Charitable activities |
Total |
EXPENDITURE ON |
Charitable activities |
Total |
NET INCOME |
RECONCILIATION OF FUNDS |
Total funds brought forward |
TOTAL FUNDS CARRIED FORWARD |
74,985 |
Palcrafts (UK) Limited (Registered number: SC242506) |
Balance Sheet |
31st December 2023 |
31.12.23 | 31.12.22 |
Unrestricted | Restricted | Total | Total |
fund | fund | funds | funds |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Investments | 3 |
CURRENT ASSETS |
Debtors | 4 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 5 | ( |
) | ( |
) | ( |
) |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
NET ASSETS |
FUNDS | 6 |
Unrestricted funds | 70,485 |
Restricted funds | 4,500 |
TOTAL FUNDS | 74,985 |
The charitable company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31st December 2023. |
The members have not required the company to obtain an audit of its financial statements for the year ended 31st December 2023 in accordance with Section 476 of the Companies Act 2006. |
Palcrafts (UK) Limited (Registered number: SC242506) |
Balance Sheet - continued |
31st December 2023 |
The trustees acknowledge their responsibilities for |
(a) | ensuring that the charitable company keeps accounting records that comply with Sections 386 and 387 of the Companies Act 2006 and |
(b) | preparing financial statements which give a true and fair view of the state of affairs of the charitable company as at the end of each financial year and of its surplus or deficit for each financial year in accordance with the requirements of Sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to financial statements, so far as applicable to the charitable company. |
These financial statements have been prepared in accordance with the provisions applicable to charitable companies subject to the small companies regime. |
The financial statements were approved by the Board of Trustees and authorised for issue on |
Palcrafts (UK) Limited |
Notes to the Financial Statements |
for the Year Ended 31st December 2023 |
1. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The financial statements of the charitable company, which is a public benefit entity under FRS 102 have prepared in accordance, the Statement of Recommended Practice "Accounting and Reporting by Charities" issued in March 2005 (SORP 2005) and the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts \Scotland) Regulations 2006 \as amended), Financial Reporting Standard FRS 102 'The Financial Reporting Standard applicable in the UK and and Republic of Ireland' (effective 1 January 2009) and the Companies Act 2006. The financial statements have been prepared under the historical cost convention, with the exception of investments which are included at market value. |
The financial statements contain information about Palcrafts (UK) Ltd as an individual charity and do not contain consolidated financial information as the parent of a group. |
Income |
All income is recognised in the Statement of Financial Activities once the charity has entitlement to the funds, it is probable that the income will be received and the amount can be measured reliably. |
Expenditure |
Liabilities are recognised as expenditure as soon as there is a legal or constructive obligation committing the charity to that expenditure, 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 accounted for on an accruals basis and has been classified under headings that aggregate all cost related to the category. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources. |
Taxation |
The charity is exempt from corporation tax on its charitable activities. |
Fund accounting |
Unrestricted funds can be used in accordance with the charitable objectives at the discretion of the trustees. |
Restricted funds can only be used for particular restricted purposes within the objects of the charity. Restrictions arise when specified by the donor or when funds are raised for particular restricted purposes. |
Further explanation of the nature and purpose of each fund is included in the notes to the financial statements. |
Palcrafts (UK) Limited |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2023 |
2. | TRUSTEES' REMUNERATION AND BENEFITS |
There were no trustees' remuneration or other benefits for the year ended 31st December 2023 nor for the year ended 31st December 2022. |
Trustees' expenses |
There were no trustees' expenses paid for the year ended 31st December 2023 nor for the year ended 31st December 2022. |
3. | FIXED ASSET INVESTMENTS |
Subsidiary |
£ |
Investment in subsidiary undertaking | 100 |
As at 31 December 2022 & 2023 | ======= |
Palcrafts (UK) Limited owns 100% of the issued share capital of Hadeel (UK) Limited, a company registered in Scotland. The accounts of Hadeel (UK) Limited show a profit of £31,515 ( 2022: loss of (£11,506) ) for the year ended 31 December 2023 and closing capital and reserves totalling (£7,445) ( 2022: (£38,960) ) as at 31 December 2023 . |
4. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.23 | 31.12.22 |
£ | £ |
Other Debtors |
Debtors due from Hadeel Ltd |
Debts due from Hadeel (UK) Ltd represents amount due from group undertakings carrying an interest free loan to assist with working capital, which is repayable on demand. |
Palcrafts (UK) Limited |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2023 |
5. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.23 | 31.12.22 |
£ | £ |
Other creditors |
Accrued expenses |
6. | MOVEMENT IN FUNDS |
Net |
movement | At |
At 1.1.23 | in funds | 31.12.23 |
£ | £ | £ |
Unrestricted funds |
General fund | 70,485 | 2,077 | 72,562 |
Restricted funds |
West Bank and Gaza projects | 4,500 | 8,985 | 13,485 |
TOTAL FUNDS | 11,062 | 86,047 |
Net movement in funds, included in the above are as follows: |
Incoming | Resources | Movement |
resources | expended | in funds |
£ | £ | £ |
Unrestricted funds |
General fund | 14,628 | (12,551 | ) | 2,077 |
Restricted funds |
West Bank and Gaza projects | 28,459 | (19,474 | ) | 8,985 |
TOTAL FUNDS | ( |
) | 11,062 |
Palcrafts (UK) Limited |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2023 |
6. | MOVEMENT IN FUNDS - continued |
Comparatives for movement in funds |
Net |
movement | At |
At 1.1.22 | in funds | 31.12.22 |
£ | £ | £ |
Unrestricted funds |
General fund | 72,885 | (2,400 | ) | 70,485 |
Restricted funds |
West Bank and Gaza projects | - | 4,500 | 4,500 |
TOTAL FUNDS | 72,885 | 2,100 | 74,985 |
Comparative net movement in funds, included in the above are as follows: |
Incoming | Resources | Movement |
resources | expended | in funds |
£ | £ | £ |
Unrestricted funds |
General fund | 15,878 | (18,278 | ) | (2,400 | ) |
Restricted funds |
West Bank and Gaza projects | 8,500 | (4,000 | ) | 4,500 |
TOTAL FUNDS | 24,378 | (22,278 | ) | 2,100 |
A current year 12 months and prior year 12 months combined position is as follows: |
Net |
movement | At |
At 1.1.22 | in funds | 31.12.23 |
£ | £ | £ |
Unrestricted funds |
General fund | 72,885 | (323 | ) | 72,562 |
Restricted funds |
West Bank and Gaza projects | - | 13,485 | 13,485 |
TOTAL FUNDS | 72,885 | 13,162 | 86,047 |
Palcrafts (UK) Limited |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2023 |
6. | MOVEMENT IN FUNDS - continued |
A current year 12 months and prior year 12 months combined net movement in funds, included in the above are as follows: |
Incoming | Resources | Movement |
resources | expended | in funds |
£ | £ | £ |
Unrestricted funds |
General fund | 30,506 | (30,829 | ) | (323 | ) |
Restricted funds |
West Bank and Gaza projects | 36,959 | (23,474 | ) | 13,485 |
TOTAL FUNDS | 67,465 | (54,303 | ) | 13,162 |
7. | OTHER FINANCIAL COMMITMENTS |
At 31 December 2023 the group had annual commitments under non-cancellable operating leases as follows: |
2023 | 2022 |
£ | £ |
Premises lease expiring within one year | 7,997 | 7,997 |
8. | RELATED PARTY DISCLOSURES |
The following transactions with Hadeel (UK) Limited ("Hadeel"), a 100% subsidiary of Palcrafts, took place during the year: |
- Included in income from charitable activities is £10,483 (2022: £10,488) which relate to rent and rates received from Hadeel. These payments are made to third party by Palcrafts (UK) Ltd. |
- Included in grants expenditure is £5,000 paid to Hadeel (2022: £4,000) which represents purchase payments paid directly to Hadeel suppliers by Palcrafts. |
As at 31 December 2023 a balance of £72,593 (2022: £64,267) was owed to Palcrafts by Hadeel. |
Palcrafts (UK) Limited |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2023 |
9. | POST BALANCE SHEET EVENTS |
Due to the continuing Middle East conflict we are facing issues in sending money to Palestine. We are in the process of arranging different channels to send money which is proving challenging, but we are hopeful that we will be able to find a solution soon. |