Lesmahagow Development Trust - Charities report - 21.1

REGISTERED COMPANY NUMBER: SC364744 (Scotland)

REGISTERED CHARITY NUMBER: SC40828

REPORT OF THE TRUSTEES AND

UNAUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 AUGUST 2020

FOR

LESMAHAGOW DEVELOPMENT TRUST

Page

Report of the Trustees

1

to

4

Independent Examiner's Report

5

Statement of Financial Activities

6

Balance Sheet

7

to

8

Notes to the Financial Statements

9

to

18

The trustees who are also directors of the charity for the purposes of the Companies Act 2006, present their report and financial statements of the charity for the year ended 31 August 2020. The trustees have adopted the provisions of Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their financial statements in accordance with Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) as amended for periods commencing on or after 1 January 2016.

OBJECTIVES AND ACTIVITIES

Objectives and aims

The Objectives of the charity as defined in the memorandum of association are to :-

(a) engage in the economic, environmental and social regeneration of the community of Lesmahagow.

(b) promote the social economy and social enterprise within Lesmahagow for the benefit of the general public.

(c) promote education, awareness and citizenship; in particular promote opportunities for learning for the benefit of the general public, including skills which will assist the participants in obtaining paid employment.

(d) improve the environment in Lesmahagow through the provision, maintenance and/or improvement of public open space, amenities and other environmental and regeneration projects (but subject to appropriate safeguards to ensure that the public benefit so arising clearly outweigh any private benefit thereby conferred on private owners).

(e) provide within Lesmahagow recreational facilities or organise activities, including the arts and/or culture, with the object of improving the conditions of life of the persons for whom the facilities or activities are primarily intended.

(f) develop and engage in anti-poverty initiatives and improve the general well-being and health of the community.

(g) preserve, for the benefit of the community, the historical, architectural and constructional heritage that may exist in or around Lesmahagow.

(h) promote, establish, operate and/or support other schemes and projects of a charitable nature for the benefit of the community.

These are a very broad set of objectives which enable the Trust to deliver activities for the benefit of the local community across a spectrum of areas including poverty, sports, culture and environment.

The Trust's Vision is to deliver sustainable community facilities and activities for the benefit of everyone living in Lesmahagow and the surrounding area, providing opportunities and reducing loneliness by improving intergenerational links. To deliver this vision, the Trust is working towards the following set of Objectives: to generate an income to be used for the benefit of the local community, to distribute grants to community groups, to address loneliness through provision of facilities and activities for older people, to maintain sufficient staff levels to effectively run facilities and services.

Significant activities

The trustees have paid due regard to guidance issued by the charity regulator in deciding what activities the Trust should undertake and/or be involved with.

During the year the Trust engaged in various activities to achieve its objectives which included the following :-

Grow A Lot Lesmahagow

This allotment project continues to be a significant project with funding secured for the development of Phase 2 of the allotments in March 2018. Work continued at the allotments as planned during the year. The Trust will also allocate funding to the Phase 2 works as considered necessary.

Activity Centre

The Trust continued to run activities from the Activities Centre within the leased building on Abbeygreen, Lesmahagow. The building has a small office and also a small area which is utilised to provide various activities. It can also be let out for private hire. Current activities include a domino group, a ladies group, a knit and natter group, a mother and toddler group and football classics.The use of the Activity Centre was severely curtailed by the coronavirus pandemic and the subsequent operational restrictions.

Netherburn West Renewable Project

The Trust's wholly owned subsidiary, Lesmahagow Limited, now owns 27% of the Netherburn West Renewable Project.

The Trust also continues to receive income from the commercial investment in a renewable energy project.

Public benefit

The charity provides public benefit by the various activities and projects undertaken in accordance with the charitable objectives and aims set out in the governing document.

Grantmaking

In addition to the return on the investment in the wind turbine scheme, Communities Benefits monies are paid by Stewart Energy to the Trust. This money is used to provide locally constituted groups with small grants. Take up continues to be slow but has increased.

25 Chromebook computers were purchased by the Trust and donated to local schools.

Volunteers

The Trust is most appreciative of the role played by volunteers in helping to successfully operate its various activities.

ACHIEVEMENT AND PERFORMANCE

Charitable activities

In the period under review, we continued to grow the numbers attending our activity groups but this was later severely restricted by the coronavirus pandemic which led to a full national lockdown at the end of March 2020.

We have worked with a wide range of partners and will continue to grow our partnership working leading to locally improved facilities, services and projects.

The small grants that we awarded have allowed small local groups to continue to operate for the benefit of members.

During the year the charitable trust acquired freehold premises located at Abbeygreen in Lesmahagow at a cost of £60,828 from designated funds set aside for the purpose during the previous financial period. It is intended that these premises will be developed to play a part in future charitable activities.

FINANCIAL REVIEW

Financial position

Total income for the year was £118,562 (2019 - £133,797). Income from donations and legacies decreased by 6.7% to £86,489 (2019 - £92,712) which includes a donation of £86,000 (2019 - £92,000) from wholly owned subsidiary, Lesmahagow Limited.

Total expenditure for the year was £45,193 (2019 - £91,735). Charitable activities at the activity centre were £27,369 and £6,028 was spent at the allotments with these two areas of activity accounting for 73.9% (2019 - 77.0%) of total expenditure for the year.

Net income for 2020 was £73,369 (2019 - £42,062).

At the end of the year the Trust had total funds of £325,013 of which £207,774 was unrestricted (2019 total funds - £251,644).

The trustees are satisfied with the results for the year under review, half of which was impacted by coronavirus pandemic restrictions, and hope to build on this in the future as restrictions are eased.

Principal funding sources

During the year the Trust received a donation of £86,000 (2019 - £92,000) from its wholly owned subsidiary, Lesmahagow Limited.

Reserves policy

It remains the policy of the Trust that unrestricted funds which have not been designated for a specific purpose should be maintained at an appropriate minimum level. The trustees consider that holding reserves at an appropriate level will ensure that in the event of a significant drop in funding, they will be able to continue the Trust's current ongoing activities whilst consideration is given to ways in which additional funding may be raised.

The trustees are satisfied with the level of reserves maintained throughout the year.

Going concern

These financial statements are prepared under the going concern basis of accounting and the trustees are not aware, at the time of approval of these financial statements, of any circumstance that bring that into question.

Users of the accounts are also directed to the Trust's going concern accounting policy on the trustees consideration of the suitability of and continued application of the going concern basis of accounting to the financial statements.

Funds in deficit

The Trust had no funds in deficit at the end of the year under review or at the end of the previous financial year.

FUTURE PLANS

The trustees intend, as circumstances allow, to operate the Trust as they did pre-covid in the foreseeable future and gradually increase charitable activities again as covid restrictions are eased.

STRUCTURE, GOVERNANCE AND MANAGEMENT

Governing document

The Lesmahagow Development Trust's governing document is its Memorandum and Articles of Association.

Charity constitution

The charity is constituted as a limited company, limited by guarantee, as defined by the Companies Act 2006.

Recruitment and appointment of new trustees

Under the Articles of Association the members may elect any member as trustee (director) at each Annual General Meeting. The Trustees (directors) may, at any time, appoint any member to be a trustee (director) and also have powers to co-opt, at any time, any non-member to be a trustee (director) on the basis that he/she has been nominated by a body with which the company has close contact in the course of its activities or on the basis that he/she has specialist experience and/or skills which could be of assistance to the directors.

Organisational structure

A Centre Manager and a Development Officer were based in the office at Abbeygreen, Lesmahagow. The Centre Manager organises activities and the Development Officer built partnership working opportunities and sought to identify and develop community projects.The Development Officer post terminated at the end of December 2019.

The work of the employees is overseen and directed by the trustees.

Decision making

The trustees are responsible for strategic decision making within the charity and the Centre Manager and Development Officer are responsible for giving effect to their direction.

Induction and training of new trustees

New trustees receive guidance and instruction from the board of trustees to make them aware of the objectives and workings of the Trust.

Wider network

The Lesmahagow Development Trust is a member of the Development Trusts Association Scotland (DTA Scotland) which aims to promote, support and represent development trusts in Scotland. It can provide information, advice and support to the development trust network in Scotland through a wide range of publications and resources and offers training and support interventions.

Related parties

Transactions with related parties are disclosed in the notes to the financial statements.

Risk management

The trustees have a duty to identify and review the risks to which the charity is exposed and to ensure appropriate controls are in place to provide reasonable assurance against fraud and error.

The trustees have assessed the major risks to which the Trust is exposed and are satisfied that systems are in place to mitigate exposure to those risks which primarily relate to sufficient funding being available to allow the Trust to continue to operate its charitable activities for the benefit of the local community in and around Lesmahagow.

REFERENCE AND ADMINISTRATIVE DETAILS

Registered Company number

SC364744 (Scotland)

Registered Charity number

SC40828

Registered office

C/O EM Cubed Limited

12 Abbeygreen

Lesmahagow

Lanarkshire

ML11 0EQ

Trustees

Mr John Fraser Goulding (resigned 21.5.2020)

Mr David MacColl

Miss Elizabeth Montgomery

Mr Michael Taylor

Company Secretary

Miss Elizabeth Montgomery

Independent Examiner

Stewart Gilmour & Co.,

Chartered Accountants

3rd Floor, St George's Buildings

5 St Vincent Place

Glasgow

G1 2DH

Approved by order of the board of trustees on 28 May 2021 and signed on its behalf by:

Mr David MacColl - Trustee

I report on the accounts for the year ended 31 August 2020 set out on pages six to eighteen.

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. 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 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.

Kenneth C Livingstone

B.A., C.A., A.I.P.F.M.

Stewart Gilmour & Co.,

Chartered Accountants

3rd Floor, St George's Buildings

5 St Vincent Place

Glasgow

G1 2DH

28 May 2021

2020

2019

Unrestricted

Restricted

Total

Total

funds

funds

funds

funds

Notes

£

£

£

£

INCOME AND ENDOWMENTS FROM

Donations and legacies

86,489

-

86,489

92,712

Charitable activities

Grow-a-lot

-

-

-

19,032

Activity Centre

1,999

-

1,999

7,022

Stewart Energy Grant Fund

-

30,000

30,000

15,000

Investment income

2

60

14

74

31

Total

88,548

30,014

118,562

133,797

EXPENDITURE ON

Charitable activities

3

Grow-a-lot

-

6,028

6,028

43,609

Governance

863

-

863

1,310

Activity Centre

27,369

-

27,369

27,039

Stewart Energy Grant Fund

-

6,614

6,614

7,952

Other charitable activities

4,319

-

4,319

11,825

Total

32,551

12,642

45,193

91,735

NET INCOME

55,997

17,372

73,369

42,062

RECONCILIATION OF FUNDS

Total funds brought forward

151,777

99,867

251,644

209,582

TOTAL FUNDS CARRIED FORWARD

207,774

117,239

325,013

251,644

2020

2019

Unrestricted

Restricted

Total

Total

funds

funds

funds

funds

Notes

£

£

£

£

FIXED ASSETS

Tangible assets

9

60,510

61,306

121,816

67,281

Investments

10

100

-

100

100

60,610

61,306

121,916

67,381

CURRENT ASSETS

Debtors

11

59

-

59

89

Cash at bank and in hand

148,084

55,933

204,017

185,969

148,143

55,933

204,076

186,058

CREDITORS

Amounts falling due within one year

12

(979

)

-

(979

)

(1,795

)

NET CURRENT ASSETS

147,164

55,933

203,097

184,263

TOTAL ASSETS LESS CURRENT LIABILITIES

207,774

117,239

325,013

251,644

NET ASSETS

207,774

117,239

325,013

251,644

FUNDS

13

Unrestricted funds

207,774

151,777

Restricted funds

117,239

99,867

TOTAL FUNDS

325,013

251,644

The charitable company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31 August 2020.

The members have not required the company to obtain an audit of its financial statements for the year ended 31 August 2020 in accordance with Section 476 of the Companies Act 2006.

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 28 May 2021 and were signed on its behalf by:

Mr David MacColl - Trustee

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, with the exception of investments which are included at market value.

The Trust has taken advantage of the provisions in the SORP for charities applying FRS 102 Update Bulletin 1 not to prepare a cash flow statement.

The currency in which the financial statements are prepared is Sterling which is the functional currency used by the Trust. Monetary amounts are rounded to the nearest £.

Going concern

At the time of approving these financial statements, the Trustees have a reasonable expectation that the Trust has adequate resources to continue in operational existence for the foreseeable future. The Trustees, therefore, continue to adopt the going concern basis of accounting in preparing the financial statements.

Preparation of consolidated financial statements

The financial statements contain information about Lesmahagow Development Trust as an individual company and do not contain consolidated financial information as the parent of a group. The charity is exempt under Section 399(2A) of the Companies Act 2006 from the requirements to prepare consolidated financial statements.

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.

Cash donations are recognised on receipt. Other donations are recognised once the Trust 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.

Legacies are recognised on receipt or if the Trust has been notified of an impending distribution, the amount is known, and receipt is expected. If the amount is not known, the legacy is treated as a contingent asset.

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.

Grants offered subject to conditions which have not been met at the year end date are noted as a commitment but not accrued as expenditure.

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

Long leasehold

-

5% on cost

Plant and machinery

-

25% on cost

Fixtures and fittings

-

15% on cost

Computer equipment

-

25% on cost

Fixed asset investments are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at the reporting date. Changes in fair values are recognised as income/(expenditure) for the year. Transaction costs are treated as expenditure as incurred.

A subsidiary is an entity controlled by the Trust. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

Lesmahagow Development Trust owns 100% of the share capital of Lesmahagow Limited. All income from Lesmahagow Limited is donated to the Trust and it is, therefore, valued at cost in the financial statements.

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.

Endowment funds are subject to specific conditions by donors that the capital must be maintained by the Trust.

2.	INVESTMENT INCOME

2020

2019

£

£

Deposit account interest

74

31

3.	CHARITABLE ACTIVITIES COSTS

Grant

Support

Direct

funding of

costs (see

Costs

activities

note 4)

Totals

£

£

£

£

Grow-a-lot

6,028

-

-

6,028

Governance

-

-

863

863

Activity Centre

22,394

4,975

-

27,369

Stewart Energy Grant Fund

-

6,614

-

6,614

Other charitable activities

4,319

-

-

4,319

32,741

11,589

863

45,193

4.	SUPPORT COSTS

Management

£

Governance

863

5.	NET INCOME/(EXPENDITURE)

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

2020

2019

£

£

Depreciation - owned assets

6,293

5,078

6.	TRUSTEES' REMUNERATION AND BENEFITS

There were no trustees' remuneration or other benefits for the year ended 31 August 2020 nor for the year ended 31 August 2019.

Trustees' expenses

There were no trustees' expenses paid for the year ended 31 August 2020 nor for the year ended 31 August 2019.

7.	STAFF COSTS

2020

2019

£

£

Wages and salaries

15,181

23,207

15,181

23,207

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

2020

2019

Development officer

-

1

Activity centre manager

1

1

1

2

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

8.	COMPARATIVES FOR THE STATEMENT OF FINANCIAL ACTIVITIES

Unrestricted

Restricted

Total

funds

funds

funds

£

£

£

INCOME AND ENDOWMENTS FROM

Donations and legacies

92,712

-

92,712

Charitable activities

Grow-a-lot

-

19,032

19,032

Activity Centre

7,022

-

7,022

Stewart Energy Grant Fund

-

15,000

15,000

Investment income

21

10

31

Total

99,755

34,042

133,797

EXPENDITURE ON

Charitable activities

Grow-a-lot

4,680

38,929

43,609

Governance

1,310

-

1,310

Activity Centre

27,039

-

27,039

Stewart Energy Grant Fund

-

7,952

7,952

Other charitable activities

11,825

-

11,825

Total

44,854

46,881

91,735

NET INCOME/(EXPENDITURE)

54,901

(12,839

)

42,062

RECONCILIATION OF FUNDS

Total funds brought forward

96,876

112,706

209,582

TOTAL FUNDS CARRIED FORWARD

151,777

99,867

251,644

9.	TANGIBLE FIXED ASSETS

Freehold

Long

Plant and

property

leasehold

machinery

£

£

£

COST

At 1 September 2019

-

84,582

91

Additions

60,828

-

-

At 31 August 2020

60,828

84,582

91

DEPRECIATION

At 1 September 2019

-

19,047

69

Charge for year

1,217

4,229

22

At 31 August 2020

1,217

23,276

91

NET BOOK VALUE

At 31 August 2020

59,611

61,306

-

At 31 August 2019

-

65,535

22

Fixtures

and

Computer

fittings

equipment

Totals

£

£

£

COST

At 1 September 2019

2,250

4,963

91,886

Additions

-

-

60,828

At 31 August 2020

2,250

4,963

152,714

DEPRECIATION

At 1 September 2019

1,013

4,476

24,605

Charge for year

338

487

6,293

At 31 August 2020

1,351

4,963

30,898

NET BOOK VALUE

At 31 August 2020

899

-

121,816

At 31 August 2019

1,237

487

67,281

10.	FIXED ASSET INVESTMENTS

Shares in

group

undertakings

£

MARKET VALUE

At 1 September 2019 and 31 August 2020

100

NET BOOK VALUE

At 31 August 2020

100

At 31 August 2019

100

There were no investment assets outside the UK.

The company's investments at the balance sheet date in the share capital of companies include the following:

Lesmahagow Limited

Registered office: United Kingdom

Nature of business: Trading company

%

Class of share:

holding

Ordinary

100

31.5.20

31.5.19

£

£

Aggregate capital and reserves

(1,189

)

(1,757

)

Profit/(loss) for the year

588

(1,018

)

As Lesmahagow Limited donates its profits to the charity there is no material movement in the value of the subsidiary. It is, therefore, considered reasonable to show the value of the subsidiary at cost.

Lesmahagow Limited prepares separate financial statements to satisfy statutory requirements. Consolidated financial statements are not prepared.

11.	DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2020

2019

£

£

Other debtors

59

89