GROVE_ROAD_PRE-SCHOOL - Accounts

The Trustees, who are also Directors for their time of office for the purposes of the Companies Act, have pleasure in presenting their report and unaudited financial statements of the charity for the year ended 31 August 2021.

The accounts have been prepared in accordance with the accounting policies set out in note 1 to the accounts 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)” (as amended for accounting periods commencing from 1 January 2016)

To enhance the development and education of children, primarily under statutory school age, by encouraging parents to understand and provide for the needs of their children through community groups by:

• Offering appropriate play, education and care facilities and training courses, together with the right of parents to take responsibility for, and to become involved in, the activities of such groups, ensuring that the groups offer opportunities for all children, whatever their race, culture, religion, means or ability.

• Encouraging the study of the needs of such children and their families and promoting public interest in and recognition of, such needs.

• Instigating, adhering to and furthering the aims and objective of the Pre-school Learning Alliance.

Public Benefit

Throughout the year the charity has operated with due regard to its objectives as stated above and the guidance issued by the Charity Commission on public benefit, with the provision of pre school facilities for children between the ages of two and a half and five within the local community.

The charity encourages the involvement of the wider community in various fundraising activities such as the Christmas Bazaar and the Easter Egg Hunt, however these events have had to be put on hold due to the restrictions in place as a result of the Covid-19 pandemic.

The Trustees have paid due regard to guidance issued by the Charity Commission in deciding what activities they charity should undertake.

The charity was inspected by Ofsted on 21 January 2020, and received a rating of 'Good' in all areas.

The effects of the worldwide Covid-19 pandemic began impacting in the UK from March 2020. this has led to a significant shut-down of both social and economic activity in the UK and in many other countries around the globe.

This has significantly impacted on the charity's activities during the year, and resulted in the charity closing to all but the children of key workers during the lockdown period. Government funding has been ongoing throughout this period, and the charity has been open for the whole accounting year.

It is impossible to determine the impact of the pandemic on future activities of the charity.

The charity has income for the year of £127,462 (2020: £132,325) and expenditure of £132,544 (2020: £142,017) resulting in a deficit of income over expenditure for the year of £5,082 (2020: £9,692).

Reserves Policy

The charity aims to retain reserves amounting to at least 3 month's expenditure, being £32,423 (2020: £35,504) based on current expenditure levels. Although results for the last few years have taken reserves to below that level at £(2,832) (2020: £2,700), it is hoped that future activity will enable the charity to fulfil its aims. See note 1.2 to the financial statements for an explanation of the planned activities to bring the reserves in line with this policy.

Small company provisions

This report has been prepared in accordance with the small companies regime under the Companies Act 2006.

The charity is a company limited by guarantee and does not have share capital. On 24 May 2010 the charity registered with the Charity Commission. The charity registration number is 1136076 and the charity address is Grove Road Pre School, Grove Road, Rayleigh, Essex, SS6 8UA.

The Trustees who are also the directors for the purpose of company law, and who served during the year were:

New Trustees are appointed by the board of Trustees. All new Trustees are given the appropriate information upon induction and training as and when necessary.

None of the Trustees has 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' report was approved by the Board of Trustees.

The Trustees, who are also the directors of Grove Road Pre-School 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;

- state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; 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 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.

I report to the Trustees on my examination of the financial statements of Grove Road Pre-School (the charity) for the year ended 31 August 2021.

As the Trustees of the charity (and also its directors for the purposes of company law) you are responsible for the preparation of the financial statements in accordance with the requirements of the Companies Act 2006 (the 2006 Act).

Having satisfied myself that the financial statements of the charity are not required to be audited under Part 16 of the 2006 Act 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 (the 2011 Act). In carrying out my examination I have followed all the applicable Directions given by the Charity Commission under section 145(5)(b) of the 2011 Act.

This report is made solely to the charity's trustees, as a body, in accordance with section 145 of the Charities Act 2011. My work has been undertaken so that I might state to the charity's trustees those matters I am required to state to them in this report and for no other purpose. To the fullest extent permitted by law, I do not accept or assume responsibility to anyone other than the charity and the charity's trustees as a body, for my work, for this report, or for the opinions I have formed.

I have completed my examination. I have identified a matter of concern in my report and concur with the material uncertainty the Trustees have highlighted relating to going concern and I would draw attention to the disclosure in note 1.2 of the financial statements regarding the Trustees' going concern assessment.

I confirm that no other 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 2006 Act; or

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 2006 Act other than any requirement that the accounts 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 accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).

I confirm that there are 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.

Fundraising activities

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 August 2021.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

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.

Grove Road Pre-School is a private company limited by guarantee incorporated in England and Wales. The registered office is Grove Road Pre-School, Grove Road, Rayleigh, Essex, SS6 8UA.

The accounts have been prepared under the historical cost convention.

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.

These financial statements are prepared on the going concern basis. The Trustees have a reasonable expectation that the charity will continue in operational existence for the foreseeable future, however, the Trustees are aware of certain material uncertainties which may cause doubt on the charity's ability to continue as a going concern. The charity has been significantly impacted by the Covid-19 pandemic which has caused worldwide disruption since March 2020. Although local authority funding has been ongoing throughout the pandemic, the fees charged to parents and the ability for the charity to carry out fundraising activities has been significantly restricted.

As at 31 August 2021 the charity's liabilities exceeds its assets by £2,382. The Trustees have a reasonable expectation that the charity will be able to continue to meet its liabilities for at least the next 12 months and is taking the following steps to improve the financial position:

- The fees charged to parents will be increased for the 2022/23 academic year

- Local authority funding per pupil is expected to increase for the 2022/23 academic year

- Following the relaxation of restrictions, several fundraising events have been planned

- There is a waiting list for places at the pre-school, and therefore it is expected to be at full capacity going forwards

For these reasons the Trustees consider the going concern basis to be appropriate.

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of their charitable objectives.

Donations are recognised where there is entitlement, receipt is probable and the amount can be measured with sufficient reliability.

Gifts in kind donated for use by the charity itself are included when received and, where material, at a value that the charity considers that they would have to pay to acquire them.

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.

Liabilities are recognised as soon as there is a legal or constructive obligation committing the charity to the expenditure. All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs related to that category.

Costs of generating funds are the costs associated with attracting voluntary income.

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).

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Items donated for resale or distribution are not included in the financial statements until they are sold or distributed.

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.

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

Governance costs

Governance costs include costs of the preparation and examination of the statutory accounts, the costs of trustee meetings and the cost of any legal advice to trustees on governance or constitutional matters.

Support costs

Support costs include central functions and have been allocated to activity cost categories on a basis consistent with the use of resources, for example, allocating property costs by floor areas, or per capita, staff costs by the time spent and other costs by their usage.

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.

Pre-school funding and fees

Pre-school funding and fees

Pre school funding and fees

Government grants

Fundraising activities

Activities for generating funds

Fundraising costs

Staff welfare and training

Establishment costs

Repairs and maintenance

Office expenses

Printing, postage and stationery

Subscriptions and donations

Educational and other equipment supplies

Sundry and other costs

Advertising and promotion

Governance costs includes payments to the accountants of £2,100 (2020- £1,920) for independent examination fees.

No trustees received any remuneration during the year.

The average monthly number of employees during the year was:

The company is a registered charity and has not undertaken any taxable activities during the year.

The charity operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the charity in an independently administered fund.

The charge to profit or loss in respect of defined contribution schemes was £563 (2020 - £616).

The remuneration of key management personnel is as follows.

There were no transactions with related parties during the year, other than school fees paid on normal commercial terms.