A member's enquiry by Cllr Paul Lorber has revealed errors in the Barham Park Trust accounts as published on the Brent Council website. Lorber reacted with the following comment to Brent Council officers:
It is clear from this reply that the Barham Park
Trust was being presented with Accounts and supporting report which were
fundamentally flawed.
Had questions not been asked the Accounts would
have been rubber stamped and sent to the Charity Commission.
Although the Accounts may have been corrected and
the numbers may now agree with what is in the books the Accounts (and past
Accounts) do not give a ‘True and Fair’ view of the state of affairs of the
Barham Park Trust.
In my view there are fundamental errors in the way
the finances and assets of the Trust are dealt with and a proper ‘arms length’
arrangements are not in place.
The scope of the ‘Independent Review’ is clearly
not sufficient to have identified these arrows and the much bigger problem and
failure to properly represent the financial arrangements between the Trust and
Brent Council.
A more fundamental review is therefore needed to
correct past errors and to properly reflect the correct income that is due to
the Trust as a result of its relationship with the Council.
For a start the cost of providing a Public Park in
the Sudbury/Wembley are should be paid for by the Council and the Trust - in
the same way that the Council pays for all the Parks in Brent.
If the Trust’s position was properly reflected in
Financial Statements and its accounts showed the correct level of income then
the wasteful approach of spending money on consultants to presenting pie in the
sky proposals which cannot be delivered in for many years anyway would not be necessary.
Cllr Lorber's Questions and Officer's Answers (in red)
1. There is an inconsistency between the Annual report and the Accounts.
In Section E it is stated that of the £575,183 the sum of £222,031 relates to
restricted funds and £353,152 to unrestricted funds. This is wrong as the
Accounts themselves show the correct designation as £222,031 as unrestricted
and £353,152 as restricted.
This needs to be corrected and the trustees advised.
Section E of the Charity
Commission template updated with correct figures as per the accounts - £222,031
unrestricted funds and £ 353,152 restricted funds (attached).
2. The Receipts and Payments accounts fail to show the Fun Fair income
on the correct line. We know that Funfairs were held during the year because
the Trustee Report says so. Where is that income and can it be put in the
correct place. Once again the Trustees need to be advised.
Funfairs income for 2022/23 was
£36,337, which was included under the ‘Property Rental Income’ heading.
This has now been reclassified under the ‘Fun Fair’ income line.
3. Can you confirm whether you carried out any checks to ensure that the
Barham Park Trust received the correct amount of income due to it from the
Fairs? The Fairs are arranged by the Park Department and the charges are set
out in a Licence Agreement. there was an agreement for the period 2017 to 2022
and a new one from 2022. The daily fee should be adjusted upwards in line with
RPI.
The daily fee is to be based on
the new 2022 agreement and reflecting for inflation. There was a
daily rate agreed in the licence doc agreed between the parties. The
calculation is daily rate x number of operating days. For each ongoing year in
an agreement, the RPIX rate is added to the daily rate charge for the duration
of the agreement.
Can you confirm the number of days the Funfair was in Barham Park
(actual days of the Fairs and the days of set up and dismantling), the daily
rate charged (correctly adjusted for RPI), calculation of the charges should
have been applied (number of days multiplied by the day rate) and the charges
actually paid by the Funfair and included in the accounts. If the amount
received is not correct please advise the relevant officer to ensure that a
further recovery is made. The accounts may need to be amended to reflect the
correct income and the year end debtor.
The reported 2022 funfair dates were:
Fun fairs: Irvin’s Fun Fair were at Barham Park:
Operating days between the 20th May to 5th June 2022 (on site 12th May
to 6th June);
Operating days between the 19th August to 4th September 2022 (and will
be on site until a few days later).
For reference the 2023 operating days were / are expected to be:
Fun fairs: Irvin’s Fun Fair were at Barham Park:
Operating between 26th May to 4th June (10 days); and onsite from 20th
May 2023.
Operating days between 18 Aug to 3rd September (17 days); and onsite
from 7th August 2023.
Note that the arrival and departure dates may be amended in practice to
enable the funfair to access and egress the site during better weather
conditions.
I would like to be satisfied that the Barham Park Trust received the
correct income form the let of its land for the Funfairs in 2022/23 and all
previous years.
The invoices are calculated and
issued reflecting the agreements.
4. As you may be aware the another report to the trustee Meeting makes
the point that the trust is not generating enough income. You may be aware that
the Funfair obtains its water via a long hose pipe from a water point near the
Harrow frontage . This water point was damaged as a result of this use and repaired.
There are two issues here:
a. who paid for the repair, how much was it and was it recharged to the
Operator?
It should be said that while a
recent leak became apparent at the same time as use by the FunFair; attributing
the cause of the leak, for example to that use or to a longer-term
infrastructure issue, was not practical. Arrangements for the repair were
managed by the Parks Service and the cost of the repair was paid by the Parks
Service from their revenue budget. The cost of the repairs that was met
by the Parks Service from their revenue budget was £795.
b. the normal Council Police of letting Parks for events states that
should the renter require water supplies these would be available for a charge.
Can you check and confirm that the Funfair is being charged and pays for all
the water that they consume. If they are not then the Trust is incurring costs
which it should not do.
While there may be provision for
the separate assessment of water used by the visiting FunFair, the measurement
of water use would involve resources and the recent practice has been to assume
that water is included in the overall charge. To be fair and accurate, the
water meter would need to be read at the start and end of the funfair’s use –
and the water use for the Walled Garden, which is on the same mains and meter,
netted-off from the sub-total.
5. Paragraph 3.4 to Agenda item 6 refers to unpaid rental income of
£29,625 as at 31 March 2023. Why is this amount shown in the Accounts within
the Cash balance rather than as a Debtor? This is incorrect and misleading. Can
this be corrected.
This will be communicated to the Trust members separately, but it has
been identified that an incorrect Charity Commission template has been used to
prepare the accounts, which will require a small change to the Trust’s debtors
and creditors. In order to rectify this issue, a corrective exercise
needs to be carried out to recognise transactions on a cash basis rather than
an accruals basis.
6. In relation to the above para 3.4 refers to "tenants". Last
year there was discussion about rent owed by ACAVA which they agreed to settle
over two years. Can you please confirm if all of the £29,625 related to ACAVA
or which of the other tenants also owed money as at 31 march 2023,
The total debt is
£29,625. Information on individual tenant debt is commercially
sensitive and is not disclosable in the public domain. As you will be
aware, we are also not able to share commercially sensitive information to
Members unless the information is pertinent to their ward and even when we do
share the information, the information remains non-disclosable in the public
domain.
7. In relation to para 3.9 of Agenda item 6 refers rental income of
£19,459 being reflected in the wrong year. Can you please explain what this
relates to and how it arose.
In 2021/22 we have received a
payment in advance. This income should have been recognised as a ‘receipt
in advance’ and deferred to 22/23, however this has not been reflected. In
essence, this means that 21/22 income was overstated by this amount, and 22/23
income was understated.
This doesn’t have an impact on
the Trust’s funds overall.
8. Can you please confirm how much income was received in 2022/23 from
parking charges in the car park and where this income is shown in the Trust
Accounts.
There is no parking charges
income reflected in the accounts. Parking Charges income is managed
centrally by the parking provider and not by the Parks Service nor the Barham
Park Trust.
9. According to para 3.7 of Agenda item 7 during the 2002/23 year Thames
Water used part of the Park for a works depot while working on the embankment.
How much were they charged for rental of the Park land and where is this income
reflected in the Trust Accounts?
The Thames Water work and that by
their contractors was at intervals and spread over more than one financial
year. (We have not had time to trace the figures and deposits at this stage.
Some of the information may be commercially confidential).
10. The 2011/22 Accounts show "ad-hoc lettings" of £14,625.
There is no similar income shown in the 2022/23 accounts. What did the £14,625
relate to?
The £14,625 represents a reversal
of a manual accrual done in 2020/21 to recognise commercial property receipts
in advance. This is a misclassification and it should have been recorded under
‘Rental Income – Other’.
11. Para 3. 3 of Agenda item 8 refers to various Religious and cultural
festivals being held in the Park. Can you confirm the type and dates of these
vents, the amount of the income charged & received and where this is shown
in the Accounts.
There were three events during
2022/23. The individual charging for each event is not provided here.
12. Although amount of Cash Balances have increased and there has been a
rise in interest rates the amount interest income received by the Trust has
only risen by a relatively small amount.
Can you explain what investigation you carried out to ensure that the
trust is receiving the correct amount of interest or has lost out because of
the current arrangements of holding its cash balances with the Council itself.
What interest could the trust have earned had it made its won arrangements and
placed the money on deposit directly with 3rd parties in either instant or term
accounts?
Every year, an interest charge is
calculated on the average cash balance and credited to the Trust’s account. In
2017 is has been agreed by the Trust that interest will be based on 2% of
average reserve balances. At the time this was higher than the Council
obtained. It is now lower, however the arrangement has not changed.
13. Paragraph 3.15 of Agenda Item 15 refers to extra work relating to
surface drainage using Verti drainage. What was the cost of this work and who
paid for it?
To date verti-draining has been
trialled on two occasions at £304.56 per occasion, which has been paid by the
Barham Park Trust.
The current License for lets requires a deposit and allows for recovery
of costs arising from damage. Have the above costs been met or recovered from
the Fair operator?
We do not tend to take a deposit
as we are able to use ongoing bookings across the borough as leverage if
required. As we don’t have in house grounds maintenance, we raise works
required with the fair and they have in the past used our external contractor
for resolution (payments would have been between those companies).
14. As you know the arrangements between the Council and the trust have
to be at arms length. The Council uses Barham Park every year for the Annual
Remembrance Service when Marquees and seating is arranged etc, Has the Council
been charged a normal hire fee for this, has it been paid and where is it shown
in the Accounts?
Income for the Remembrance Day is
charged via internal recharge, though low amounts are not normally charged
between services. It would simply be £65 - £72 in recent years.
