Caithness F.M. Limited - Charities report - 22.2

REGISTERED COMPANY NUMBER: SC185596 (Scotland)

REGISTERED CHARITY NUMBER: SC050922

Report of the Trustees and

Unaudited Financial Statements for the Year Ended 31 March 2023

for

Caithness F.M. Limited

Page

Report of the Trustees

1

to

3

Independent Examiner's Report

4

Statement of Financial Activities

5

Balance Sheet

6

to

7

Notes to the Financial Statements

8

to

14

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 March 2023. 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

Caithness FM Ltd (CFM) was set up as a company limited by guarantee in 1998 listed as SC185596. It was originally envisaged as a charity, but under the rules of the day, did not qualify. However, its aims and objectives were set up as though it was a charity. They are:

- The prevention and relief of poverty.

- The advancement of citizenship and community development.

-The advancement of the arts, heritage culture or science.

Included in these objects are:

- Run a community radio service to encourage disadvantaged and isolated rural populations to be fully aware of community affairs and opportunities.

- Liaise with other voluntary sector bodies, local authorities, UK or Scottish government departments and agencies, and other bodies, all with a view to furthering the company's objects.

- Establish and/or support any other charity and make donations for any charitable purpose falling within the company's objects. In support of this object, we run a Christmas Toy Appeal, with donated toys etc distributed throughout the county of Caithness to disadvantaged families.

In 2005 the charity governance for Scotland was changed when the Office of the Scottish Charities Regulator (OSCR) was set up. The new arrangements included community radio as an organisation eligible to be a charity. So in 2021 we applied for and were awarded charity status, listed as SC050922. This gave us several benefits such as exemption from business rates and water charges.

CFM broadcasts on 106.5 FM in the county of Caithness and on the internet. As such, we are regulated by OfCom [CR102144\ for the FM broadcast and also by PRS/PPL for music rights on both broadcast and internet. These licences represent a considerable cost which needs to be covered by advertising and sponsorship. To date we have six regular sponsored shows and numerous short-term advertisements which need continual administration to maintain.

The station is run entirely by volunteers. Our current list of presenters is 15, each contributing an average of 2.6 broadcast hours per week. The directors contribute considerably more in terms of management and maintenance.

ACHIEVEMENT AND PERFORMANCE

Charitable activities

Due to ever increasing energy costs, we took advice from Business Energy Scotland and were successful in obtaining a grant and loan via the government's Energy Savings Trust for a new air-source heating system. We also investigated replacing the flat roof, following a serious leak which could have destroyed our studio equipment. The leak was repaired by our own volunteers. We will seek grants for a new roof, with a better insulation value than the current one.

Our sustaining service, originally Moray Firth Radio, then the internet based MFR2 has changed again. Bauer Media replaced MFR2 with Greatest Hits Radio for the North of Scotland, (GHR) so this is the 24-hour output (known as our sustaining service) on FM and internet when we are off air. We also use GHR for our news service. We maintain 39 live broadcast hours per week, our Ofcom obligation (condition of licence) is for 35 hours.

We programmed a couple of extra broadcasts at Christmas and Easter, providing a breakfast show for both weeks. We also used our show-van for an outside broadcast and fundraiser for Thurso's 'Fun Day' promoting shopping locally at Christmas time. We continue to offer free advertising for local charities, arts etc events and interviews with local people and community organisations.

The décor of our building constantly needs refreshed. A local employer has offered the services of volunteer help to redecorate. Grass cutting on our extensive plot is a big maintenance chore for our volunteers in the summer months. Local criminal justice payback helps with the most difficult bits. These two things taken together show our contribution to local wellbeing is appreciated.

FINANCIAL REVIEW

Reserves policy

The charity has always operated a reserves policy based on the possibility of equipment failure. Our main audio desk, for example has never been replaced in our 24 years of operation. In the event of total loss through fire for example, we would be unlikely to recover its value as it will have depreciated to zero. We always have a certain turnover of equipment failure to cover.

In the event of loss of the building we would want to be back on air as soon as possible to keep business disruption to a minimum. We think £12k reserve sufficient.

Reserves are also needed in the event of loss of income. We believe a further £10k is needed.

Also, we operate the Toy Appeal as though it is a separate entity, being moneys donated by individuals and corporations for this purpose. This account stands at around £18k and is regarded as reserved funds.

FUTURE PLANS

The music mixing desk equipment is the original one installed in 1998. This remains good quality and has definitely paid for itself but is showing its age. Whilst it could be maintained, a decision has been made to replace it with modern equipment. This project will be a major refurbish of most of our studio equipment, including computerisation of some existing hardware functions. This will also mean a big retraining task for our volunteers.

As in previous years, we accept donations of cash and new toys for our Christmas Toy Appeal. The Toy Appeal has been running for longer than we have been on air and continues to be well received and supported by the generous people and businesses of Caithness. Several local businesses and stores operate collection points for toys. The recipients are identified by volunteers from the Council's Social Work department. In Christmas 2022 the toys we supplied were distributed to an estimated 350 children in our home county of Caithness.

We will explore the possibility of making the CFM Toy Appeal a separate SCIO charity from the Community Radio aspects of the business. They already are operated as such, with different bank accounts, but this will result in additional registration with OSCR.

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.

Recruitment and appointment of new trustees

The charity encourages those members who wish to be considered for appointment as trustee to give written notice to the company prior to the AGM. The board is able to co-opt trustees at any time. All directors retire annually but are eligible for re-election.

REFERENCE AND ADMINISTRATIVE DETAILS

Registered Company number

SC185596 (Scotland)

Registered Charity number

SC050922

Registered office

Neil Gunn Drive

Ormlie Industrial Estate

Thurso

Caithness

KW14 7QU

Trustees

R Saxon

J Johnson

R Johnson

R Young

B Saxon

K S Mcarthur

S MacDonald

S Owsnett

Company Secretary

J Johnson

Independent Examiner

Reid & Fraser

Chartered Accountants

15 Princes Street

Thurso

Caithness

KW14 7BQ

STATEMENT OF TRUSTEES' RESPONSIBILITIES

The trustees (who are also the directors of Caithness F.M. Limited 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 which 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 Charity 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.

Approved by order of the board of trustees on 23 August 2023 and signed on its behalf by:

J Johnson - Trustee

I report on the accounts for the year ended 31 March 2023 set out on pages five to fourteen.

Respective responsibilities of trustees and examiner

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 (as amended). 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.

Linda Cameron FCCA CTA CA

The Institute of Chartered Accountants of Scotland

Reid & Fraser

Chartered Accountants

15 Princes Street

Thurso

Caithness

KW14 7BQ

Date: .............................................

2023

2022

Unrestricted

Restricted

Total

Total

fund

funds

funds

funds

Notes

£

£

£

£

INCOME AND ENDOWMENTS FROM

Donations and legacies

2

21,384

20,525

41,909

38,684

Charitable activities

4

Radio Show

7,991

10,000

17,991

44,960

Investment income

3

2

-

2

-

Total

29,377

30,525

59,902

83,644

EXPENDITURE ON

Charitable activities

Radio Show

35,687

3,675

39,362

38,113

Toy Appeal

-

16,125

16,125

12,797

Total

35,687

19,800

55,487

50,910

NET INCOME/(EXPENDITURE)

(6,310

)

10,725

4,415

32,734

Transfers between funds

15

(3,484

)

3,484

-

-

Net movement in funds

(9,794

)

14,209

4,415

32,734

RECONCILIATION OF FUNDS

Total funds brought forward

52,769

35,331

88,100

55,366

TOTAL FUNDS CARRIED FORWARD

42,975

49,540

92,515

88,100

2023

2022

Unrestricted

Restricted

Total

Total

fund

funds

funds

funds

Notes

£

£

£

£

FIXED ASSETS

Intangible assets

9

226

-

226

266

Tangible assets

10

4,173

24,821

28,994

22,154

4,399

24,821

29,220

22,420

CURRENT ASSETS

Debtors

11

4,799

10,589

15,388

20,221

Cash at bank and in hand

34,777

24,092

58,869

46,459

39,576

34,681

74,257

66,680

CREDITORS

Amounts falling due within one year

12

(1,000

)

(6,994

)

(7,994

)

(1,000

)

NET CURRENT ASSETS

38,576

27,687

66,263

65,680

TOTAL ASSETS LESS CURRENT LIABILITIES

42,975

52,508

95,483

88,100

CREDITORS

Amounts falling due after more than one year

13

-

(2,968

)

(2,968

)

-

NET ASSETS

42,975

49,540

92,515

88,100

FUNDS

15

Unrestricted funds

42,975

52,769

Restricted funds

49,540

35,331

TOTAL FUNDS

92,515

88,100

The charitable company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31 March 2023.

The members have not required the company to obtain an audit of its financial statements for the year ended 31 March 2023 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 23 August 2023 and were signed on its behalf by:

J Johnson - 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.

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.

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.

INTANGIBLE ASSETS

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Patents and licences are being amortised at the following annual rates:

Licences - 15% reducing balance

TANGIBLE FIXED ASSETS

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

Equipment

-

20% straight line

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.

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

DONATED GOODS AND SERVICES

Donated goods and services are recognised as income when the charity has control over the item, any conditions associated with the donated items have been met, the receipt of economic benefit from the use of the charity of the item is probable and that economic benefit can be measured reliably.

GRANTS RECEIVED

Grants received in respect of capital expenditure are credited to the statement of financial activities in the period received in accordance with the guidance contained in the Statement of Recommended Practice.

Grants of a revenue nature are credited to income so as to match them with the expenditure to which they relate.

2.	DONATIONS AND LEGACIES

2023

2022

£

£

Donations and gifts received

18,725

17,863

Membership Fees

70

95

Donated goods and services

23,114

20,726

41,909

38,684

3.	INVESTMENT INCOME

2023

2022

£

£

Deposit account interest

2

-

4.	INCOME FROM CHARITABLE ACTIVITIES

2023

2022

Activity

£

£

Sponsorship income

Radio Show

3,293

4,299

Commercial income

Radio Show

4,698

20,192

Grants

Radio Show

10,000

19,932

Government grants amortised

Radio Show

-

537

17,991

44,960

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

2023

2022

£

£

Halkirk District Benefit Fund - Building refurbishment

-

2,500

Adapt & Thrive - Online broadcasting

-

5,108

Baillie Wind Farm Benefit Fund - Building refurbishment

-

12,324

Energy Savings Trust - Building refurbishment

10,000

-

10,000

19,932

5.	NET INCOME/(EXPENDITURE)

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

2023

2022

£

£

Depreciation - owned assets

6,696

3,987

Patents and licences amortisation

40

47

6.	TRUSTEES' REMUNERATION AND BENEFITS

There were no trustees' remuneration or other benefits for the year ended 31 March 2023 nor for the year ended 31 March 2022.

TRUSTEES' EXPENSES

There were no trustees' expenses paid for the year ended 31 March 2023 nor for the year ended 31 March 2022.

7.	STAFF COSTS

The average number of employees in the year was Nil (2022 - Nil).

8.	COMPARATIVES FOR THE STATEMENT OF FINANCIAL ACTIVITIES

Unrestricted

Restricted

Total

fund

funds

funds

£

£

£

INCOME AND ENDOWMENTS FROM

Donations and legacies

20,971

17,713

38,684

Charitable activities

Radio Show

25,028

19,932

44,960

Total

45,999

37,645

83,644

EXPENDITURE ON

Charitable activities

Radio Show

34,009

4,104

38,113

Toy Appeal

-

12,797

12,797

Total

34,009

16,901

50,910

NET INCOME

11,990

20,744

32,734

RECONCILIATION OF FUNDS

Total funds brought forward

40,779

14,587

55,366

TOTAL FUNDS CARRIED FORWARD

52,769

35,331

88,100

9.	INTANGIBLE FIXED ASSETS

Patents

and

licences

£

COST

At 1 April 2022 and 31 March 2023

600

AMORTISATION

At 1 April 2022

334

Charge for year

40

At 31 March 2023

374

NET BOOK VALUE

At 31 March 2023

226

At 31 March 2022

266

10.	TANGIBLE FIXED ASSETS

Land and

buildings

Equipment

Totals

£

£

£

COST

At 1 April 2022

15,068

71,294

86,362

Additions

-

13,536

13,536

At 31 March 2023

15,068

84,830

99,898

DEPRECIATION

At 1 April 2022

-

64,208

64,208

Charge for year

-

6,696

6,696

At 31 March 2023

-

70,904

70,904

NET BOOK VALUE

At 31 March 2023

15,068

13,926

28,994

At 31 March 2022

15,068

7,086

22,154

11.	DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2023

2022

£

£

Trade debtors

15,388

20,221

12.	CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2023

2022

£

£

Other loans (see note 14)

443

-

Trade creditors

7,551

1,000

7,994

1,000

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

2023

2022

£

£

Other loans (see note 14)

2,968

-

14.

LOANS

An analysis of the maturity of loans is given below:

2023

2022

£

£

Amounts falling due within one year on demand:

Other loans

443

-

Amounts falling between one and two years:

Other loans - 1-2 years

443

-

Amounts falling due between two and five years:

Other loans - 2-5 years

1,328

-

Amounts falling due in more than five years:

Repayable by instalments:

Other loans more 5yrs instal

1,197

-

15.	MOVEMENT IN FUNDS

Net

Transfers

movement

between

At

At 1.4.22

in funds

funds

31.3.23

£

£

£

£

Unrestricted funds

General fund

52,769

(6,310

)

(3,484

)

42,975

Restricted funds

Toy Appeal

19,502

4,400

-

23,902

Property refurbishment

14,444

6,931

3,484

24,859

Online broadcasting

1,385

(606

)

-

779

35,331

10,725

3,484

49,540

TOTAL FUNDS

88,100

4,415

-

92,515

Net movement in funds, included in the above are as follows:

Incoming

Resources

Movement

resources

expended

in funds

£

£

£

Unrestricted funds

General fund

29,377

(35,687

)

(6,310

)

Restricted funds

Toy Appeal

20,525

(16,125

)

4,400

Property refurbishment

10,001

(3,070

)

6,931

Online broadcasting

(1

)

(605

)

(606

)

30,525

(19,800

)

10,725

TOTAL FUNDS

59,902

(55,487

)

4,415

Comparatives for movement in funds

Net

movement

At

At 1.4.21

in funds

31.3.22

£

£

£

Unrestricted funds

General fund

40,779

11,990

52,769

Restricted funds

Toy Appeal

14,587

4,915

19,502

Property refurbishment

-

14,444

14,444

Online broadcasting

-

1,385

1,385

14,587

20,744

35,331

TOTAL FUNDS

55,366

32,734

88,100

Comparative net movement in funds, included in the above are as follows:

Incoming

Resources

Movement

resources

expended

in funds

£

£

£

Unrestricted funds

General fund

45,999

(34,009

)

11,990

Restricted funds

Toy Appeal

17,712

(12,797

)

4,915

Property refurbishment

14,824

(380

)

14,444

Online broadcasting

5,109

(3,724

)

1,385

37,645

(16,901

)

20,744

TOTAL FUNDS

83,644

(50,910

)

32,734