The trustees present their annual report and financial statements for the year ended 31 August 2024.
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 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 ("the Objects") are:
To advance the education of children up to the age of 11, in and around the parish of Saltdean, East Sussex, in particular by:
a) the provision of pre-school, after school and other childcare facilities.
b) the provision of relevant training courses for parents, volunteers and staff.
The group is registered with Ofsted to have the capacity to supply up to eighty one children each session. These include up to fifteen baby places for children under two years of age.
Staff are encouraged to continue their personal development plans and are sponsoring 2 senior members of staff with their university degrees in childcare and education.
The trustees have paid due regard to guidance issued by the Charity Commission in deciding what activities the charity should undertake. Including in regard to fee charging.
The baby room numbers continue to be high and an increase in speech and language delay has been noted across the nursery.
The affects of Covid on children's development continues. These children now move up into our pre-school rooms and we continue to support them.
Staff well-being continues as a priority. Several staff have requested flexible working hours and adjustments are being worked out, however, these don't always fit with the business needs, and more part-time staff is costly to the setting. Increases in training, uniforms and HR requirements. Small things such as social events, comfortable staff room items and well-being inset days are planned.
Nursery work is stressful and low paid, government funding for the 'free' hours is still low. By September 2025 most children will be covered by funding rather than private fees. The announcement in the budget that yet another rise to minimum wage and NI contributions alongside a lower income has caused disappointment and frustration.
The added relaxing of staff ratios, meaning more children per staff member to look after, has caused many to re-consider career options and we have decided NOT to change our ratios from our current ones, as we believe it would impact on quality of care and staff well-being.
It is not possible to operate at full capacity, empty sessions on odd days are hard to navigate and fill. High numbers of SEN (18) in the setting take time to provide for, as do children with English as an additional language (21). 1 child currently needs 1:1 care, partly financially supported by Brighton Council.
The setting looked into innovative ideas to retain staff. Due to high housing costs in the area, we looked into purchasing property and renting to staff at affordable rental. However, the unsettled markets and Charities Aid Foundation bank high costs to arrange the mortgage, made this unviable. The setting continues to have the same issues and is still considering its options around purchasing property.
Two staff have now finished working for the DfE under the ‘Experts and Mentors program’ This was aimed at mitigating the affects of covid on children development. These staff have supported other nurseries and schools in improving practice and outcomes for children. Payment from the DfE for their DfE wages has come via our payroll system and will be identified separately in the accounts for clarity. Other BK staff will then have access to the DfE training programs related to this work.
During the year, the charity had a deficit of £13,502 (2023: surplus £39,236), of which £2,704 (2023: surplus £45,594) was a deficit from unrestricted funds, and £10,798 (2023: deficit £6,358) was a deficit from restricted funds. In response to deficits in previous years, the setting has increased its fees from September 2023 and there will be an annual increase every September. Parental contracts have been altered to allow a further mid-year increase, should there be a need for financial sustainability.
At the balance sheet date, total funds stood at £958,940 (2023: £972,442), of which £356,980 (2023: £359,684) was unrestricted funds, and £601,960 (2023: £612,758) was restricted funds in relation to the restricted asset, the barn. At the balance sheet date, a transfer of £9,534 (2023: £13,974) was made from unrestricted funds to restricted funds, to reflect the movement on the loan and the property over which it is secured.
The trustees wish to hold reserves of at least three months running costs, which equates to approximately £150,000. As at the year-end, the charity had free reserves of £356,980 (2023: £359,684). The trustees are confident that the charity is a going concern as long as financial budgeting and careful financial monitoring continues.
The setting employed graduate staff last year and alongside this to balance the finances, three apprentices. This works well, however, the further increase in the living wage is a concern as it affects more senior staff too. Increasing junior staff wages has a knock on affect across the nursery. The extra six hours study time a week to pay apprentices at the £11.44 per hour (April 2024) adds concerns to the monthly staffing costs with further increase due in April 2025.
Professional advice on a new fees structure has been obtained as the setting recognised the need to get support with financial decisions. The government funding covers more and more age groups of children which is a huge concern as the low rate paid does not cover the settings costs and BK is not allowed under government funding rules, to add parental fee ‘top up’ to mitigate the losses. By September 2025 nearly all children, and therefore all fee income, will be via government funding. This leaves the setting battling with balancing reducing its costs and trying to maintain quality.
The trustees annually review the risks that the charity faces. These risks continue to be mainly related to finance. Helen Hicks, founder of Boomerang Kids, is an important part of the charity's risk assessment and considered to be another risk should she leave or retire. The trustees have put in place a senior team to support her in the running of the nursery. They have also arranged flexible working hours.
The trustees have a risk management strategy which comprises the following:
a review of the risks the charity faces;
the establishment of systems and procedures to mitigate those risks once identified; and
the implementation of procedures designed to minimise any potential impact on the charity should those risks materialise.
The trustees are satisfied that systems are in place to mitigate exposure to the major risks.
The charity is a company limited by guarantee, company number 04451272, charity registration number 1096356, and is governed by its Memorandum and Articles of Association. The flysheet to the accounts gives details of the charity's principle addresses and those of other relevant organisations.
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:
The Memorandum and Articles of Association provides for a minimum of three trustees. Were there a requirement for new trustees, these would be identified and appointed by the remaining trustees.
Training for new and existing trustees is undertaken as required.
The chair of trustees is responsible for the induction of any new trustee, which involves awareness of a trustee's responsibility and philosophical approach to the charity. A new trustee would receive copies of the previous year's annual report and accounts, and a copy of the Charity Commission leaflet 'The Essential Trustee: What You Need to Know'.
The day-to-day running of the group is delegated to the manager, Mrs H Hicks.
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.
The trustees, who are also the directors of Boomerang Kids for the purpose of company law, are responsible for preparing the Trustees' Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
The trustees' report was approved by the Board of Trustees.
I report to the trustees on my examination of the financial statements of Boomerang Kids (the charity) for the year ended 31 August 2024.
Having satisfied myself that the financial statements of the charity are not required to be audited under Part 16 of the Companies Act 2006 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. In carrying out my examination I have followed the Directions given by the Charity Commission under section 145(5)(b) of the Charities Act 2011.
Since the charity’s gross income exceeded £250,000, the independent examiner must be a member of a body listed in section 145 of the Charities Act 2011. I confirm that I am qualified to undertake the examination because I am a member of FCCA ACA, which is one of the listed bodies.
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 Companies Act 2006.
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 Companies Act 2006 other than any requirement that the financial statements 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 financial statements in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).
I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report 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.
Boomerang Kids is a private company limited by guarantee incorporated in England and Wales. The registered office is 4 Frederick Terrace, Frederick Place, Brighton, East Sussex, BN1 1AX.
The financial statements have been prepared in accordance with the Companies Act 2006, 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.
Mrs H Hicks, a trustee, was paid £50,480 in salary (2023: £49,980), and £5,121 in pension contributions (2023: £5,121) during the year in her capacity as Nursery Manager, as authorised by the trustees and the Charity Commission. In 2023, a further £4,500 was paid to Mrs H Hicks, but this related to work done on behalf of the Department of Education.
None of the other trustees (or any persons connected with them) received any remuneration or benefits from the companycharity during the year.
The average monthly number of employees during the year was:
The charity is exempt from tax on income and gains falling within section 505 of the Taxes Act 1988 or section 252 of the Taxationof Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects.
The bank loan is secured by a fixed charge over the leasehold premises, Saltdean Barn, limited to £200,000. At the year end the interest rate was 1.6%.
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.
The restricted fund originally related to grant income that was received to renovate Saltdean Barn and its garden. Now Saltdean Barn and garden has been renovated it now represents the net book value of Saltdean Barn and garden. Subsequently a loan was also taken out for further property improvements which was secured against Saltdean Barn, so it has also been allocated to the restricted fund.
The movement in the year reflects the net movement on the asset and loan.
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 (2023 - none), apart from the remuneration disclosed in note 8.