REGISTERED COMPANY NUMBER: SC097207 (Scotland)

REGISTERED CHARITY NUMBER: SCO11160

REPORT OF THE TRUSTEES AND

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 OCTOBER 2024

FOR

FAIR ISLE BIRD OBSERVATORY TRUST (THE)

Page

Report of the Trustees

1

Report of the Independent Auditors

6

Statement of Financial Activities

10

Balance Sheet

11

Cash Flow Statement

13

Notes to the Cash Flow Statement

14

Notes to the Financial Statements

15

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 31 October 2024. 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

Operate the Observatory as a profitable business

FIBOT will run the Observatory as a profitable, financially-viable business by accommodating birdwatchers, researchers and other guests to a current target of ca3000 bed-nights per April-October season. This will be achieved in a way that takes into consideration the objectives of FIBOT's other stakeholders and funders, such as the Fair Isle community, the National Trust for Scotland, Shetland Islands Council, Highlands & Islands Enterprise, Scottish Natural Heritage, Office of the Scottish Charity Regulator and the Scottish Government. When possible, FIBOT will seek grants and donations to support its scientific and other work.

Provide enjoyable holidays at an attractive price

The Observatory will provide an enjoyable and comfortable place to stay at an attractive price for serious birdwatchers, non-serious birdwatchers, researchers and also non-birdwatching visitors who, for example, want to enjoy the island scenery and its special way of life.

Encourage an interest in birds, other wildlife and outdoor activities

FIBOT will encourage as many people as possible to take an interest in birds, other wildlife and outdoor activities such as walking and photography.

Maintain close harmonious links with the islanders

FIBOT shall co-exist harmoniously with the island community by ensuring its guests behave appropriately, by FIBOT's participation in community activities, by making the Observatory available for island social events and through co-operation with the Fair Isle Community Association. FIBOT will support the Fair Isle economy wherever possible, helping to justify the operation of flight and ferry services, maintaining a successful shop/post office and promoting island products to visitors.

Scientific research

FIBOT shall help advance scientific knowledge of bird migration, sea-bird populations, cetaceans and other topics by collecting data and providing discounted accommodation and facilities for researchers at the observatory. Where appropriate, FIBOT will directly fund specific ornithological studies, including analyses exploiting the FIBOT database of daily bird sightings. FIBOT will encourage and participate in ornithological studies involving other observatories across the world.

Encourage young ornithologists

FIBOT will provide funding and discounted accommodation to encourage young ornithologists to stay at the observatory in order to develop their knowledge and experience of ornithology.

Environmental and habitat protection

FIBOT will enhance the environment of Fair Isle by appropriate planting of vegetation and crops to provide food and shelter for migrating birds including maintaining wetland areas. FIBOT shall also actively support the work of the Fair Isle Marine Environment & Tourism Initiative (FIMETI).

The Statement of Financial Activities for the year is set out on page 7. The principal activity of the company continues to be the provision and operation of a Bird Observatory on Fair Isle to undertake ornithological research and provide leisure opportunities with particular reference to the study of breeding and migrating birds at the Fair Isle.

ACHIEVEMENTS AND PERFORMANCE

Internal and external factors

Progress with the rebuild of the Observatory had been very satisfactory during 2023 and the building was made watertight and weatherproof by the start of the 2023/24 financial year. A small amount of work was carried out on the interior of the building over the winter months, and, by March 2024, the interiors were 75% complete.

IDMH/Lighthouse (the builders) collapsed into bankruptcy in March 2024. This was a major blow to the project and the board made the decision that FIBOT should take over the management of the completion of the building and employ directly the ex-IDMH Project Manager and ex-IDMH Site Manager. This arrangement worked extremely well and by the end of 2024 the building was almost complete with the furniture being ordered and the recruitment of hospitality staff having begun, ready for the first guests to be welcomed in May 2025.

STRUCTURE, GOVERNANCE AND MANAGEMENT

Governing document

The charity is controlled by its governing document, a deed of trust, and constitutes a limited company, limited by guarantee, as defined by the Companies Act 2006.

REFERENCE AND ADMINISTRATIVE DETAILS

Registered Company number

SC097207 (Scotland)

Registered Charity number

SCO11160

Registered office

C/O Anderson Strathern LLP

58 Morrison Street

Edinburgh

EH3 8BP

Principal address

Bird Observatory

Fair Isle

Shetland

ZE2 9JU

Trustees

P M Ellis

Dr J M Reid

R M Wood (Finance Director)

A Bennett

D Barr (Chair)

M R Bolton

I Cowgill

I J Andrews

K Hall (Vice-Chair)

P V Harvey

G Tyler

H R Shaw

I Broadbent (appointed 28/10/2024)

Company Secretary

AS Company Services Limited

Auditors

Momentum Taxation and Accountancy Ltd

-Statutory Auditor

Harelands Courtyard Offices

Moor Road

Melsonby

Richmond

North Yorkshire

DL10 5NY

Bankers

Bank Of Scotland

38 St Andrew Square

Edinburgh

EH2 2YS

STATEMENT OF TRUSTEES' RESPONSIBILITIES

The trustees (who are also the directors of Fair Isle Bird Observatory Trust (The) for the purposes of company law) are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires the trustees to prepare financial statements for each financial year. Under that law, the trustees have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law).

Under company law the trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing those financial statements, the trustees are required to

-	select suitable accounting policies and then apply them consistently;

-	observe the methods and principles in the Charities SORP;

-	make judgements and estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business.

The trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the charitable company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In so far as the trustees are aware:

-	there is no relevant audit information of which the charitable company's auditors are unaware; and

-	the trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information.

AUDITORS

The auditors, Momentum Taxation and Accountancy Ltd , will be proposed for re-appointment at the forthcoming Annual General Meeting.

This report has been prepared in accordance with the special provisions of Part 15 of the Companies Act 2006 relating to small companies.

Approved by order of the board of trustees on 22 December 2025 and signed on its behalf by:

I Broadbent - Trustee

Opinion

We have audited the financial statements of Fair Isle Bird Observatory Trust (The) (the 'charitable company') for the year ended 31 October 2024 which comprise the Statement of Financial Activities, the Balance Sheet, the Cash Flow Statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the charitable company's affairs as at 31 October 2024 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006, the Charities and Trustee Investment (Scotland) Act 2005 and Regulation 8 of the Charities Accounts (Scotland) Regulations 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the trustees' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.

Other information

The trustees are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Report of the Independent Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Charities Accounts (Scotland) Regulations 2006 requires us to report to you if, in our opinion:

-	the information given in the Report of the Trustees is inconsistent in any material respect with the financial statements; or

-	the charitable company has not kept adequate accounting records; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of trustees

As explained more fully in the Statement of Trustees' Responsibilities, the trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the charitable company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Our responsibilities for the audit of the financial statements

We have been appointed as auditors under Section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005 and report in accordance with the Act and relevant regulations made or having effect thereunder.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Independent Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements, including how fraud may occur by enquiring of management of its own consideration of fraud. In particular, we looked at where management made subjective judgements, for example in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. We also considered potential financial or other pressures, opportunity and motivations for fraud. As part of this discussion we identified the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations and how management monitor these processes. Appropriate procedures included the review and testing of manual journals and key estimates and judgements made by management.Our tests included agreeing the financial statements disclosures to underlying supporting documentation and enquiries with management. We did not identify any key audit matters relating to irregularities, including fraud. We also addressed the risk of management override of internal controls including testing journals and evaluation whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud. Our audit procedures were designed to respond to risks of material misstatement in the financial statements,recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery,misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the more remote that the non-compliances (eg with laws and regulations) are from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Independent Auditors.

Use of our report

This report is made solely to the charitable company's trustees, as a body, in accordance with Regulation 10 of the Charities Accounts (Scotland) Regulations 2006. Our audit work has been undertaken so that we might state to the charitable company's trustees those matters we are required to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's trustees as a body, for our audit work, for this report, or for the opinions we have formed.

for and on behalf of Momentum Taxation and Accountancy Ltd

-Statutory Auditor

Eligible to act as an auditor in terms of Section 1212 of the Companies Act 2006

Harelands Courtyard Offices

Moor Road

Melsonby

Richmond

North Yorkshire

DL10 5NY

23 December 2025

2024

2023

Unrestricted

Restricted

Total

Total

fund

fund

funds

funds

Notes

£

£

£

£

INCOME AND ENDOWMENTS FROM

Donations and legacies

2

1,039,390

-

1,039,390

1,321,204

Other income

75,000

-

75,000

-

Total

1,114,390

-

1,114,390

1,321,204

EXPENDITURE ON

Raising funds

3

45,968

-

45,968

40,435

Other

105,229

-

105,229

91,391

Total

151,197

-

151,197

131,826

NET INCOME

963,193

-

963,193

1,189,378

RECONCILIATION OF FUNDS

Total funds brought forward

6,539,662

-

6,539,662

5,350,284

TOTAL FUNDS CARRIED FORWARD

7,502,855

-

7,502,855

6,539,662

2024

2023

Unrestricted

Restricted

Total

Total

fund

fund

funds

funds

Notes

£

£

£

£

FIXED ASSETS

Tangible assets

8

8,509,768

-

8,509,768

6,609,307

CURRENT ASSETS

Debtors

9

233,052

-

233,052

35,552

Accrued income

13,174

-

13,174

260,420

Cash at bank

89,563

-

89,563

563,200

335,789

-

335,789

859,172

CREDITORS

Amounts falling due within one year

10

(834,369

)

-

(834,369

)

(410,916

)

NET CURRENT ASSETS

(498,580

)

-

(498,580

)

448,256

TOTAL ASSETS LESS CURRENT LIABILITIES

8,011,188

-

8,011,188

7,057,563

CREDITORS

Amounts falling due after more than one year

11

(508,333

)

-

(508,333

)

(517,901

)

NET ASSETS

7,502,855

-

7,502,855

6,539,662

FUNDS

13

Unrestricted funds

7,502,855

6,539,662

TOTAL FUNDS

7,502,855

6,539,662

The charitable company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31 October 2024.

The members have not deposited notice, pursuant to Section 476 of the Companies Act 2006 requiring an audit of these financial statements.

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 audited under the requirements of Section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005.

The financial statements were approved by the Board of Trustees and authorised for issue on 22 December 2025 and were signed on its behalf by:

I Broadbent - Trustee

Cash flows from operating activities

Cash generated from operations

1

1,439,621

1,679,467

Interest paid

(910

)

(726

)

Net cash provided by operating activities

1,438,711

1,678,741

Cash flows from investing activities

Purchase of tangible fixed assets

(1,902,661

)

(2,080,195

)

Net cash used in investing activities

(1,902,661

)

(2,080,195

)

Cash flows from financing activities

New loans in year

-

500,000

Loan repayments in year

(9,687

)

(10,119

)

Net cash (used in)/provided by financing activities

(9,687

)

489,881

Change in cash and cash equivalents in the reporting period

(473,637

)

88,427

Cash and cash equivalents at the beginning of the reporting period

563,200

474,773

Cash and cash equivalents at the end of the reporting period

89,563

563,200

1.	RECONCILIATION OF NET INCOME TO NET CASH FLOW FROM OPERATING ACTIVITIES

2024

2023

£

£

Net income for the reporting period (as per the Statement of Financial Activities)

963,193

1,189,378

Adjustments for:

Depreciation charges

1,788

2,055

Loss on disposal of fixed assets

412

-

Interest paid

910

726

Decrease in debtors

26,229

255,647

Increase in creditors

447,089

231,661

Net cash provided by operations

1,439,621

1,679,467

2.	ANALYSIS OF CHANGES IN NET FUNDS/(DEBT)

At 1/11/23

Cash flow

At 31/10/24

£

£

£

Net cash

Cash at bank

563,200

(473,637

)

89,563

563,200

(473,637

)

89,563

Debt

Debts falling due within 1 year

(10,119

)

119

(10,000

)

Debts falling due after 1 year

(517,901

)

9,568

(508,333

)

(528,020

)

9,687

(518,333

)

Total

35,180

(463,950

)

(428,770

)

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 been prepared in accordance with the Charities SORP (FRS 102) '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)', Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

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.

No amount is included in the financial statements for volunteer time in line with the SORP.

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.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold property

-

2% on cost

Plant and machinery

-

15% on reducing balance

Motor vehicles

-

25% on reducing balance

The freehold property is currently under construction, so no depreciation has been charged in the year.

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.

Although the charity has received funding in the form of grants specifically for the rebuilding of the Observatory and the employment of staff, these have not been accounted for as restricted funds as the monies are received in arrears and only after the charity has paid for the associated costs in full.

Further explanation of the nature and purpose of each fund is included in the notes to the financial statements.

2.	DONATIONS AND LEGACIES

2024

2023

£

£

Donations

16,105

77,326

Grants

1,014,514

1,235,680

Subscriptions

8,771

8,198

1,039,390

1,321,204

Grants received, included in the above, are as follows:

2024

2023

£

£

Shetlands Island Council

7,242

163,707

Highlands & Islands Enterprise

336,078

1,051,485

Orithological income

13,174

7,381

National Trust Scotland

4,420

5,304

Nature Scot Ranger

3,600

6,600

SIACS Grant

-

1,203

Energy Saving (CARES)

100,000

-

Department for Levelling Up, Housing and Communities

550,000

-

1,014,514

1,235,680

3.	RAISING FUNDS

Other trading activities

2024

2023

£

£

Purchases

11,124

8,544

Staff costs

34,844

31,891

45,968

40,435

4.	SUPPORT COSTS

Governance

Management

Finance

costs

Totals

£

£

£

£

Other resources expended

60,653

4,567

40,009

105,229

5.	NET INCOME/(EXPENDITURE)

Net income/(expenditure) is stated after charging/(crediting):

2024

2023

£

£

Auditors' remuneration

6,807

5,880

Depreciation - owned assets

1,788

2,055

Deficit on disposal of fixed assets

412

-

6.	TRUSTEES' REMUNERATION AND BENEFITS

There were no trustees' remuneration or other benefits for the year ended 31 October 2024 nor for the year ended 31 October 2023.

Trustees' expenses

Two trustees had expenses reimbursed by the charity. These totalled £6,345 for the year ended 31 October 2024 (2023 -£8,855).

The costs included travel and subsistence, IT costs, postage and stationery and use of home as office.

7.	STAFF COSTS

2024

2023

£

£

Wages and salaries

34,844

31,891

34,844

31,891

The average monthly number of employees during the year was as follows:

2024

2023

Observatory staff

2

2

No employees received emoluments in excess of £60,000.

8.	TANGIBLE FIXED ASSETS

Freehold

Plant and

Motor

property

machinery

vehicles

Totals

£

£

£

£

COST

At 1 November 2023

6,602,197

4,522

21,526

6,628,245

Additions

1,900,036

1,125

1,500

1,902,661

Disposals

-

-

(10,500

)

(10,500

)

At 31 October 2024

8,502,233

5,647

12,526

8,520,406

DEPRECIATION

At 1 November 2023

-

2,516

16,422

18,938

Charge for year

-

386

1,402

1,788

Eliminated on disposal

-

-

(10,088

)

(10,088

)

At 31 October 2024

-

2,902

7,736

10,638

NET BOOK VALUE

At 31 October 2024

8,502,233

2,745

4,790

8,509,768

At 31 October 2023

6,602,197

2,006

5,104

6,609,307

9.

DEBTORS

2024

2023

£

£

Amounts falling due within one year:

VAT

136,742

24,853

Prepayments

65,675

3,976

202,417

28,829

Amounts falling due after more than one year:

Other debtors

30,635

6,723

Aggregate amounts

233,052

35,552

10.	CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2024

2023

£

£

Bank loans and overdrafts (see note 12)

10,000

10,119

Trade creditors

246,296

5,097

Social security and other taxes

416

350

Other creditors

547,445

300,169

Pension creditor

146

187

Accrued expenses

30,066

94,994

834,369

410,916

11.	CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

2024

2023

£

£

Bank loans (see note 12)

8,333

17,901

Other loans (see note 12)

500,000

500,000

508,333

517,901

12.

LOANS

An analysis of the maturity of loans is given below:

2024

2023

£

£

Amounts falling due within one year on demand:

Bank loans

10,000

10,119

Amounts falling due between two and five years:

Bank loans - 2-5 years

8,333

17,901

Other loans - 2-5 years

500,000

-

Other loans

-

500,000

508,333

517,901

The £500,000 loan from the Shetland Charitable Trust is interest free and repayable by annual instalments over 5 years.