LALIBELA_ALTERNATIVE_EDUC - Accounts

The trustees present their report and financial statements for the year ended 30 November 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 constitution, 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's objective is to create access to education and income generating activities for youth in Ethiopia.

Significant activities

In the furtherance of the objectives of the charity, the key activity of the charity is to support the running of a school and its pupils in Lalibela. While the initial charitable project completed successfully, the trustees have since been looking out for and assessing new projects to take on.

In light of the ongoing situation in Lalibela, the Trustees believe that any future projects cannot commence until the situation has stabilised in the region and are looking to maximise income over the short-term until these projects can commence.

The charity was effectively dormant during the year with the charity outgoings being only compliance related costs.

The results for the year as detailed in the attached accounts are deemed satisfactory by the trustees.

For the year ended 30 November 2020, the Statement of Financial Activities shows total incoming resources of £1,960 (2019: £1,950) and total outgoing resources of £1,621 (2019: £27,900). After exchange rate variances, net incoming resources for the year was £128 (2019 - outgoings: £26,050). This has resulted in an increase in total funds, with total funds at the year end of £65,362 compared to £65,234 at the end of the previous year.

In preparing the Financial Statements, the trustees have had regard to the financial position of the charity as evidenced in the Balance Sheet, and to the likely sources of income during that period and beyond. The trustees are satisfied that presentation of the financial statements on the basis of the charity as a going concern is appropriate, and the financial statements have therefore been presented on that basis.

Reserves policy

It is the policy of the charity that unrestricted funds which have not been designated for a specific use should be maintained at a level equivalent to between three and six month’s expenditure. The trustees consider that reserves at this level will ensure that, in the event of a significant drop in funding, they will be able to continue the charity’s current activities while consideration is given to ways in which additional funds may be raised. This level of reserves has been maintained throughout the year.

Principal funding sources

In 2013, the charity received a significant bequest. While the previous project was successfully completed, research was done for new projects. In 2015, £65,000 was loaned to a company in which director A Littlejohn is also a director. This loan is regarded by the trustees as a flexible way of receiving above market interest to be used to fund charitable activities and was approved by OSCR in advance of payments, The remaining balance of the bequest has been retained as cash to meet any short term needs of the charity.

Risk management

The trustees have assessed the major risks to which the charity is exposed, and are satisfied that systems are in place to mitigate exposure to the major risks.

Plans for the future

The charity plans to continue its research into new projects to commence when the situation stabilises in Lalibela.

The charity is controlled by its governing documents, its memorandum and articles of association, and constitutes a limited company, limited by guarantee, as defined by the Companies Act 2006.

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 charity ensures that new trustees have skills that will complement the existing structure of the Board and has put in place procedures to ensure adequate training and induction is given.

None of the trustees have any beneficial interest in the company. All of the trustees are members of the company and guarantee to contribute £1 in the event of a winding up.

The trustees, who are also the directors of Lalibela Alternative Education Community Project 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).

Company Law requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that year.

In preparing these 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; and

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

The trustees are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Charities and Trustee Investment (Scotland) Act 2005, the Charities Accounts (Scotland) Regulations 2006 (as amended) and the Companies Act 2006. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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

I report on the financial statements of the charity for the year ended 30 November 2020, which are set out on pages 5 to 10.

The charity’s trustees, who are also the directors of Lalibela Alternative Education Community Project for the purposes of company law, are responsible for the preparation of the financial statements in accordance with the terms of the Charities and Trustee Investments (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006. The trustees consider that the audit requirement of Regulation 10(1)(a) to (c) of the 2006 Accounts Regulations does not apply. It is my responsibility to examine the financial statements as required under section 44(1)(c) of the Act and to state whether particular matters have come to my attention.

My examination is carried out in accordance with Regulation 11 of the 2006 Accounts Regulations. An examination includes a review of the accounting records kept by the charity and a comparison of the financial statements presented with those records. It also includes consideration of any unusual items or disclosures in the financial statements, and seeks explanations from the 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 financial statements.

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 2005 Act and Regulation 4 of the 2006 Accounts Regulations; and

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 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.

The company is entitled to the exemption from the audit requirement contained in section 477 of the Companies Act 2006, for the year ended 30 November 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.

Lalibela Alternative Education Community Project is a private company limited by guarantee incorporated in Scotland. The registered office is Caledonia House, 89, Seaward Street, Glasgow, G41 1HJ, Scotland.

The financial statements have been prepared in accordance with the charity's Consitution, 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 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.

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.

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.

The charity is exempt from corporation tax on its charitable activities.

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction.

Loan interest

Ethiopian school support

Ethiopian school support

Donation - school & pupils

Donation - overhead contribution

Bank charges

Other costs

Independent examiner's fee

None of the trustees (or any persons connected with them) received any remuneration or benefits from the charity during the year (2019: none).

There were no trustees' expenses paid during the year (2019: none).

The trustees are considered to be key management personnel and are not remunerated.

During the year the charity entered into the following transactions with related parties:

The following amounts were outstanding at the reporting end date:

The amount owed has no formal repayment period and interest is charged at an above market rate, which is currently averaging 5%.