MAIDSTONE BOROUGH COUNCIL

COBTREE MANOR ESTATE COMMITTEE

9^TH JULY 2014

REPORT OF THE HEAD OF FINANCE & RESOURCES

1              FINANCIAL POSITION 2014/15                                                                                                  

1.1        Issue for Decision                                                                                                          

1.1.1   To consider the current financial position of the Golf Course and Manor Park as at 31^st May 2014.                                                                                                

1.2        Recommendation of the Head of Finance & Resources                                                    

1.2.1   That the current financial position as at 31^st May 2014 is noted.        

1.3        Reasons for Recommendation                                                                     

1.3.1   Attached at APPENDIX A is the current financial position, including the projected outturn as at 31^st May 2014. If any significant financial issues arise during June these will be reported verbally to the meeting.                                                                                             

1.3.2   The report also includes details of capital expenditure and total investments held.                                                                                                                                        

1.4         Current Financial Position                                                                                     

1.4.1   The 2013/14 outturn position (Appendix A) showed that the net operational surplus for the Estate was £9,252. This was somewhat lower than previous years, due to a combination of increased running costs at the Manor Park, and some one-off costs incurred in respect of the Kent Life attraction.  The draft accounts for 2013/14 will be brought to the next meeting of the Committee in September.                                                                                                                        

1.4.2   The Golf Course is projected to continue to produce a healthy net surplus for 2014/15; however the projected deficit on the Manor Park will mean that only a small overall net surplus is forecast, so it is important that costs are closely monitored to ensure that the activities of the Estate at least break even for the year. There will also be some additional costs incurred in respect of the Kent Life attraction, but it is anticipated that there will be sufficient income to cover these costs.                                                                                                                 

1.4.3   With the on-going implementation of the master plan the opportunity exists for developing additional income streams to cover these extra costs, particularly around the new Visitor Centre and Café. The Golf Course contract is also due for renewal in January 2015, and officers are in discussions with the current contractors over the renewal.                                                                                                             

1.5         Investments

1.5.1    The market value of the investments held with Charifund has continued to rise following the dip in value in the recent past. Total withdrawals of £506,000 to fund the master plan have now been made, which is reflected in the values shown below. The current value is shown in the table below.

1.6         Capital Expenditure                                                                                              

1.6.1    The budget for the Master Plan was agreed at £1.065m, to be funded by drawing down from the endowment funds invested with Charifund. However additional funding of £0.3m from Cobtree Charity Trust Ltd for the visitor centre has now been agreed, which will reduce the need to withdraw funds from Charifund.

1.6.2    To date there has been expenditure of £678,068 on Phase 1 works in respect of the play area, car park and other associated works, and funding to the value of £506,000 has been drawn down from the endowment fund to cover the expenditure, with the balance being funded from previous operational surpluses generated from the Estate activities. Expenditure to date on the Visitor Centre is £7,396.                                                                                   

1.7        Alternative Actions and Why Not Recommended                                          

1.7.1    The Committee could not receive updates during the year on the financial position, but this would not be consistent with good financial management.                                                                                                                                                                                     

1.8        Impact on the Charity’s Objectives                                                              

1.8.1    The net surplus on the activities of the Golf Course and the Manor Park are to be used to further the long term aims and objectives of the Trust, particularly the agreed Master Plan for the development of the Manor Park.                                                                                                                

1.9        Risk Management                                                                                                                     

1.9.1    Good financial management allows more informed decisions to be made regarding the ongoing activities of the Trust.                                                                                                                                                                                                                                                                              

1.10    Other Implications                                                                                                                                                                                       

1.11              Financial Implications                                                                                  

Financial Implications are detailed in the report above.