The trustees present their annual report and financial statements for the year ended 31 January 2024.
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 governing document, 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)
Aims and Objectives
The principle objectives of the Instone charity is to relieve in cases of need, hardship or distress persons who are resident in the County of Kent or the Unitary Authority of Medway, to establish conduct and carry out activities for the relief, regeneration, supply and humane benefit of the needy (young and old) of the community by contributing to their need and requirements of everyday life, the purchase of foods, foodstuffs, medicines, clothing, and all other like activities which may be required, including the provision of monies and money's worth for the payment of staff and employees of the company and for the payment of salaries to administrators/civil servants and public employees engaged in furtherance of activities for the provision of services, education and medical facilities, housing, supply of food and the like to the peoples of the area, all such activities to be carried out on a non-profit making charitable basis and to be solely for humanitarian purposes.
Strategies for Achieving our Objectives
The policies adopted in furtherance of these objects are that the management will look for opportunities in the year to meet these objectives and to find entities to partner with who are also meeting the objectives of the charity. They will also look to raise funds via donations, sales of donated goods and other fund raising activities such as raffles until such a time as the built up funds allow a more sustainable long term project and there has been no change in these during the year.
The trustees have paid due regard to guidance issued by the Charity Commission in deciding what activities the charity should undertake for public benefit.
The charity raises funds through its retail trading activity as a charity shop by selling donated goods, however the shop was unable to trade during the year due to the impact of Covid.
Grant Making Policy
Grants are to be made to those in need as set out in the Charities objectives.
The Trustees have agreed that the sum of £25,000 needs to be raised prior to any substantial grants being made to ensure the Charity has sufficient funds to satisfy its obligations i.e. rent, insurance etc on the property 141 High Street Rochester
All applications for a grant or grants to be considered by Trustees at the next available meeting or if urgent need then by earlier meeting. Trustees are requested to put forward suggestions regarding grant opportunities. All grant requests to be considered on their merits and be approved if they are within the grant guidelines.
Use of Volunteers
The charity shop relies on volunteers in order to operate.
Due to the impact of Covid the charity shop remained closed and the stock was put into storage. No donations were made during the year. The landlord has provided a rent free period.
Reserves Policy
The Charity's reserve policy is to retain a sufficient level of reserves to fulfil its financial obligations and to make charitable donation. It is the policy of the charity that unrestricted funds which have not been designated for a specific use should be accumulated to a value of £25,000 before donations are made.
The trustees considers that reserves at this level will ensure that, in the event of a significant drop in funding, they will be able to continue the charity’s current activities while consideration is given to ways in which additional funds may be raised.
Risk Management
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 from its members under the terms of its memorandum of association.
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:
Details of method of recruitment and appointment of trustees include;
None of the trustees has any beneficial interest in the company. All of the trustees are members of the company and guarantee to contribute £10 in the event of a winding up.
Under the requirements of the Memorandum and Articles of Association one-third of the trustees will be required to retire at each annual general meeting by rotation and will then be able to be reappointed if the vacancy is not filled. New trustees can be appointed by the existing trustees.
Details of organisational structure
All aspects of the overall management and the day to day operations are conducted by the trustees.
The charity pays rent and insurance to a company called Lovellrise Limited, which is a related party. Aaron Stone who is a trustee of the charity is a shareholder of Lovellrise Limited. The rent due under the lease agreement is below market value and in recent years the landlord has agreed a rent reduction with Instone Limited. The charity is not currently involved with any other parties, however it looks to form relationships with any local entities who can help to further its objectives.
The trustees report 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.
Instone Limited is a private company limited by guarantee incorporated in England and Wales. The registered office is 5 Parrs Head Mews, Rochester, Kent, ME1 1NP.
The accounts have been prepared in accordance with the charity's governing document, 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 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.
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 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.
Donated goods are recognised as income when they are sold.
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.
Expenditure is included in the statement of financial activities on an accruals basis, inclusive of any VAT which cannot be recovered.
Expenditure on raising funds includes the rent, rates, utility and other operating costs of the charity shop.
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 charity is exempt from tax on income and gains falling within section 505 of the Taxes Act 1988 or section 252 of the Taxation of Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects.
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.
None of the trustees (or any persons connected with them) received any remuneration from the charity during the year. The charity does pay rent to Lovellrise Limited, a company in which the trustee, Aaron Stone, is a shareholder. The rent payable to this company is considered to be below market value.
The average monthly number of employees during the year was:
During the year the charity entered into the following transactions with related parties:
The charity has a lease to let premises for the charity shop with a company called Lovellrise Limited, which is a related party. Aaron Stone who is a trustee of the charity is a shareholder of Lovellrise Limited. The rent due under the lease agreement is below market value at £12,500 per year however the company has been given a rent free year due to its current financial situation.
The charity is not currently involved with any other parties, however it looks to form relationships with any local entities who can help to further its objectives.