ARGYLL_AND_BUTE_CITIZENS_ - Accounts

The trustees present their report and financial statements for the year ended 31 March 2020.

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 Articles and Memorandum of Association, 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)".

The Bureau's objective to provide a service to the community of Argyll and Bute is met through the delivery of face-to-face service from offices in Lochgilphead and Helensburgh. The service operates at outreach locations in Dunoon, Campbeltown and Oban. A telephone, video-conference and e-mail advice service is available 5 days per week during the hours of 10am to 4pm. Since March 2020 the bureau is only providing advice by telephone, e-mail and video conferencing.

During 2019/20 a major two year initiative, Reach Out Argyll, funded by Citizens Advice Scotland provided additional resources to recruit and train more volunteer advisers to enable us to see clients at more outreach locations and provide valuable information to other rural bureaux. Over 2019-2020 the Bureau was supported by 14 volunteers 8 of whom were recruited and trained as part of the Reach Out Argyll project. It takes around 6 months to train a volunteer to become a qualified Generalist Adviser. In addition to providing resources directly to trainee advisers, resources are also used to develop existing volunteers to become mentors, who then take on the role of supporting trainees. Each volunteer commits to providing us with around 6 hours per week, but we are indebted to the commitment of our volunteers who often provide much more. The work of volunteers and development staff was key to the success of the Bureau in providing no break in service to the people of Argyll & Bute throughout the uncertainty of the Coronavirus Lockdown from March 2020

Following Argyll and Bute Council’s review of advice services in 2018, the Bureau was successful in winning the tender opportunity for advice across Argyll and Bute for debt and benefits advice. Advice provision under this 3 year contract commenced midway through 2019.

Additional funding continues from a number of sources including the Scottish Government through SLAB for the Housing/Debt project, from NHS for the PASS project (Patient Advice and Support Service), from Poppyscotland and Royal British Legion for the ASAP project (Armed Services Advice Project), from the Scottish Government for Welfare Reform funding, from DWP for Universal Credit Help to Claim & Pension wise and Citizens Advice Scotland for various smaller projects.

Benefits and Debt continues to be the largest single area of advice and the clients are typically in employment but on low incomes suffering unforeseen life events. Our help to clients has resulted in families and individuals being saved from losing their home and repayment of debts to Argyll and Bute Council for Council Tax, housing associations rent and utility companies (among others) being met through working with clients to draw up affordable, sustainable repayment plans.

The company is funded on a zero based budget and will not therefore accumulate significant reserves. Funds donated for a specific purpose (restricted funds) will be fully expended for that purpose such that any balances held at the year-end will be due to timing differences only. However, the Board has decided that for prudent risk management, there will be an aspiration to maintain a reserve of at least 12 months running costs. This will ensure that any short term loss of funding or delayed payments are fully covered so that no reduction of service occurs to the people of Argyll and Bute. Development of this reserve will take some time to generate.

The Board has assessed the major risks to which the charity is exposed.

Impact of COVID-19

The Trustees have considered carefully the impact of COVID-19 on the Charity. The Trustee's believe due to the continuing support of specific COVID-19 funding from Scottish and UK governments coupled with the continuance of project specific funding, that the overall financial impact of COVID-19 can be managed.

The major risks are of any reduction in core funding from Argyll & Bute Council, the loss of funding at the end of the contract period or our inability to obtain new funding streams. The loss of funding or lack of new funding may be due to the economic climate or the pressures on local authorities to reduce their expenditure and significant applications for charitable funding.

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:

Each new member elected to the board is given a pro forma induction pack which includes such items as the annual report, the current business plan, the organisational chart, details of the powers and duties of the directors, the Citizens Advice Scotland handbook and the minutes of the last three board meetings.

The main partners who financed the work of the organisation during 2019/2020 were:

•    Argyll and Bute Council (Debt & Benefits Advice)

•    NHS Highland (PASS project)

•    Scottish Government SLAB (Housing Debt project)

•    Scottish Government (Welfare Reform project)

•    Poppy Scotland (Armed Services Advice project and Unforgotten Forces)

•    DWP (Pension Wise project)

•    Citizens Advice Scotland (Reach Out Argyll project)

Note 17 sets out an analysis of the assets attributable to the various funds.

The trustees' report was approved by the Board of Trustees.

I report on the financial statements of the charity for the year ended 31 March 2020, which are set out on pages 5 to 18.

The trustees, who are also the directors of Argyll and Bute Citizens Advice Bureau for the purposes of company law, 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 trustees consider that the audit requirement of Regulation 10 (1) (a) to (c) of the Accounts Regulations does not apply.

My examination was carried out in accordance with Regulation 11 of the Charities Accounts (Scotland) Regulations 2006 (as amended). 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 seeks explanations from the directors 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 these accounts.

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 Charities and Trustees Investment (Scotland) 2005 Act and Regulation 4 of the Charities Accounts (Scotland) Regulations 2006 (as amended);

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 accounts to be reached.

Iain D C Webster CA

The statement of financial activities includes all gains and losses recognised in the year.

All income and expenditure derive from continuing activities.

The company is entitled to the exemption from the audit requirement contained in section 477 of the Companies Act 2006, for the year ended 31 March 2020.

The trustees acknowledge their responsibilities for ensuring that the charity keeps accounting records which comply with section 386 of the Act and for preparing financial statements which give a true and fair view of the state of affairs of the company as at the end of the financial year and of its incoming resources and application of resources, including its income and expenditure, for the 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 company.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

Argyll and Bute Citizens Advice Bureau is a private company limited by guarantee incorporated in Scotland. The registered office is Argyll & Bute Citizens Advice Bureau, Riverside, Oban Road, Lochgilphead, PA31 8NG.

The financial statements have been prepared in accordance with the charity's Articles and Memorandum of Association, 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)". 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 31 March 2019, the charity has reserves of £100,891 (2019: £54,928) of which £26,102 (2019: £21,741) represent unrestricted reserves. This falls below the level of 12 months reserves the Trustees aim to hold in line with their reserves policy for the charity. The Board have conducted a review of the next 12 months and concluded that the charity has sufficient grant income to continue to meet costs and continue operating as a going concern in the next 12 months.

The Trustees have considered the risks and impact of Covid-19 and conclude that the financial impact to the bureau is minimal.

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.

Expenditure other than that which has been capitalised is charged to the Income and Expenditure Account on an accruals basis, inclusive of Value Added Tax. "Direct Charitable Expenditure" comprises all costs and expenses considered to relate directly to achieving and maintaining the objectives of Argyll and Bute Citizens Advice Bureau.

Restricted expenditure is defined within the funding bids proferred to facilitate the restricted income received and is allocated on this basis.

Basic financial liabilities, including trade and other payables 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 payables 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 payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

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 net income/(expenditure) for the year.

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’ 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 trade and other receivables 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 trade and other payables 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 payables 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 payables 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.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

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.

Donated goods totalling £1,168 represent laptops donated to the charity from CAS: Help to Claim.

Core funding

Core funding

Other grants consist of £6,644 received from Citizens Advice Scotland for EU Support costs.

The Trust is dependent on the services of several volunteers who willingly give of their time towards the provision of the Trusts' services. It is not possible to quantify the value of these voluntary services but the Trust is greatly indebted to those volunteers who give so freely of their valuable time.

Travel and subsistence costs

Repairs and IT maintenance

Heat, light and rent

Postage, stationary and office costs

Telephone and insurance costs

Subscriptions

Training and recruitment costs

Marketing and publicity

Volunteer costs

General

Management and administration costs includes payments to the accountants of £940 (2019- £895) for independent examination fees and £1,292 (2019- £1,242) for other services.

None of the trustees (or any persons connected with them) received any remuneration during the year and no trustees were reimbursed for any costs (2019-one trustee was reimbursed £117 for travel costs).

The average monthly number of employees during the year was:

The transfer of £2,518 (2019) represents £545 of funding received from CAS (Pension Wise) used against general overheads (not specific overheads such as rent) and the release of £1,973 from Energy Best Deal (again - for overheads).

Argyll & Bute Citizens Advice Bureau participates in The Pensions Trust Growth Plan (the Plan). The Plan is funded and is not contracted-out of the State Pension scheme. The plan is a multi-employer pension plan.

It is not possible in the normal course of events to identify the share of underlying assets and liabilities belonging to an individual participating employer as the Scheme is a multi-employer arrangement where the assets are co-mingled for investment purposes, benefits are paid from the total Scheme assets, and the contribution rate for all employers is set by reference to the overall financial position of the Scheme rather than by reference to individual employer experience. Accordingly, due to the nature of the Scheme, the accounting charge for the period under FRS102 (1A) represents the employer contribution payable.

The Trustees commission an actuarial valuation of the Scheme every five years. The main purpose of the valuation is to determine the financial position of the Scheme in order to determine the level of future contributions required, so that the Scheme can meet its pension obligations as they fall due.

The last formal valuation of the Plan was performed as at 30 September 2015 by a professionally qualified Actuary using the Projected Unit Credit method. The market value of the Scheme's assets at the valuation date was £862 million. The valuation revealed a shortfall of assets compared with the value of liabilities of £206.9 million, equivalent to a past service funding level of 80.7%. The next formal valuation of the plan is expected for the year ending 30 September 2020.

The Scheme Actuary has prepared an Actuarial Report that provides an approximate update on the funding position of the Scheme as at 30 September 2019. Such a report is required by legislation for years in which a full actuarial valuation is not carried out. The funding update revealed a decrease in the shortfall of assets compared to liabilities to approximately £111.9 million, equivalent to a past service funding level of 88.0%.

Following a change in legislation in September 2005 there is a potential debt on the employer that could be levied by the Trustee of the Scheme. The debt is due in the event of the employer ceasing to participate in the Scheme or the Scheme winding up.

The debt for the Scheme as a whole is calculated by comparing the liabilities for the Scheme (calculated on a buy-out basis, i.e. the cost of securing benefits by purchasing annuity policies from an insurer, plus an allowance for expenses) with the assets of the Scheme. If the liabilities exceed assets there is a buy-out debt.

The leaving employer's share of the buy-out debt is the proportion of the Scheme's liability attributable to employment with the leaving employer compared to the total amount of the Scheme's liabilities (relating to employment with all the employers). The leaving employer's debt therefore includes a share of any 'orphan' liabilities in respect of previously participating employers. The amount of the debt therefore depends on many factors including total Scheme liabilities, Scheme investment performance, the liabilities in respect of current and former employees of the employer, financial conditions at the time of the cessation event and the insurance buy-out market. The amounts of debt can therefore be volatile over time.

Argyll & Bute Citizens Advice Bureau has been notified by The Pensions Trust of the estimated employer debt on withdrawal from The Pensions Trust Growth Plan based on the financial position of the Scheme as at 30 September 2019. As of this date the estimated employer debt for Argyll & Bute Citizens Advice Bureau was £14,540.

There were no disclosable related party transactions during the year (2019 - none).