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- Meeting of Cobtree Manor Estate Charity Committee, Monday 20th January, 2020 2.30 pm (Item 64.)
- View the background to item 64.
The Senior Finance Manager (Client) introduced his report setting out the audited Report and Financial Statements for the year ended 31 March 2019 for approval prior to submission to the Charity Commission by 31 January 2020.
It was noted that:
· The audit had been undertaken by UHY Hacker Young, the Charity’s External Auditors, who intended to issue an unmodified audit opinion.
· No major issues had arisen regarding the accounts during the audit. A number of adjustments were made to the draft accounts submitted for audit and there was a small number of unadjusted misstatements none of which had had any impact upon the financial resources available to the Charity.
· The total funds of the Charity as shown on the Balance Sheet had increased from £4.26m to £5.17m, with the Statement of Financial Activities (SOFA) showing a net funds increase of £906,633 for the year. The increase in the funds included gains on the revaluations of both the fixed assets of the Charity and the investments held.
· There had been a significant increase in the value of the investment properties held following a review of the valuation approach by the External Auditors who had recommended that the most appropriate approach would be to use fair value rather than existing use value. Fair value broadly reflected the open market value of the properties if they were to be sold whereas existing use value reflected their worth in their current form.
· The External Auditors had indicated that in their opinion this would increase the value of the investment properties by £770,000 and this had led to the increase in funds held. Formal valuations would be done on this basis going forward. This had no operational or financial impact on the resources of the Charity but ensured that the balance sheet more accurately reflects the value of the assets held.
· The accounts now included a figure for the repayment of the money loaned by the Borough Council towards the cost of the car park works. This was shown under creditors on the balance sheet.
· The accounts also included the write-off of a debt of £9,266 for a sum that was due from Mytime. This debt dated back a number of years and related to an agreement that was made at the time that MyTime would reimburse the Charity for new ovens installed in the Golf Course Clubhouse. The agreement was not followed up and recovery of the debt was now considered unlikely.
· The majority of the significant reductions in the comparator figures in the notes to the accounts were due to the operation of the café/visitor centre passing to an external contractor in April 2018.
· The purpose of the Letter of Representation for 2018/19 was to ask the Committee to confirm a number of statements relating to the audit and the information supplied to the External Auditors during the course of their audit.
· The purpose of the Management Letter was to draw the attention of the Committee to matters of interest that had arisen during the external audit process including the recommendation relating to the basis of investment property valuations.
During the discussion on the accounts, it was suggested and agreed that the Officers be requested to circulate to all Members of the Committee details of the multiplier of rental income used for the valuations of investment property and to discuss with the External Auditors the change in the valuation approach and the link between rental income and asset values. It was also suggested and agreed that the Officers seek clarification regarding the involvement of Kent County Council in the governance arrangements of the Charity.
1. That the audited Report and Financial Statements for 2018/19 be approved and submitted to the Charity Commission.
2. That the change in the valuation approach for investment properties be noted.
3. That the Letter of Representation be approved.
4. That the contents of the Management Letter and the proposed course of actions by the Officers be noted.
5. That the Officers be requested to circulate to all Members of the Committee details of the multiplier of rental income used for the valuations of investment property and to discuss with the External Auditors the change in the valuation approach and the link between rental income and asset values.
6. That the Officers seek clarification regarding the involvement of Kent County Council in the governance arrangements of the Charity.
- Final Accounts 2018/19, item 64. PDF 68 KB View as HTML (64./1) 70 KB
- Appendix 1 - Final Accounts 2018/19, item 64. PDF 559 KB
- Appendix 2 - Letter of Representation, item 64. PDF 375 KB
- Appendix 3 - Management Letter, item 64. PDF 563 KB