BIRMINGHAM CITY BUSINESS SCHOOL

ASSESSMENT BRIEF

MODULE TITLE:Principles of Not-for-Profit Accounting & Governance (RE-SIT)

MODULE CODE:ACC6038

1. Assessment overview
   • Method of assessment

The assessment consists of 2 questions.

Question 1 requires you to complete the Charity Commission for England and Wales (CCEW) Receipts and Payments (R&P) template (CC16a). part b) then requires you to provide technical advice on the different accounting treatment of a few transactions between the R&P accounting and SORP accounting bases.

Question 2 requires you to provide practical guidance in the form of a series of briefing notes to the trustees of the charity on several issues of concern.

To pass this module, you must achieve a final overall mark of at least 40%.

• Deadlines & submission

The deadline for submissions is:Monday 15^thJuly 2024, 12pm (Midday).

Work must be submitted online via the link provided in theAssessmentarea of the modules Moodle site. Please follow the University policy regarding online submission and submitting assessed material on time (see Page 2).

Please retain a copy of your original assessment material for your own records.

• Word count / Time allowance

The maximum word count for your assignment is:2,000words.

• Assignment format

You are required to submit two files: for question 1) a Microsoft Office Excel Spreadsheet and for question 1)b. and question 2) a Microsoft Office Word document.

Material should be written in formal business English and structured in a clear way to ensure that ideas are expressed effectively.

ALL facts, concepts and quotations should be referenced as appropriate using the Harvard referencing system.

• Tutor support

Specific feedback on individual assessments will only be available via scheduled, face-to-face meetings, not via email. To make the most of these sessions, it is expected that you will have already begun work on your assessment and have a list of questions for your tutor prepared in advance.

Detailed feedback will not be possible via email and lecturers can only comment in detail on one draft only. Comments on multiple drafts are not possible as there is a danger your work actually becomes your lecturers work. However, if you have any specific queries, or need additional support, you can still book a tutorial at any timeup to one week prior to the deadline tutorials and draft reviewswill notbe provided in the final week prior to the deadline, so it is important that you start work on your draft early and book a meeting as soon as possible.

Please note that tutors are unable to indicate a provisional grade for your work at any point prior to the official release date. As such, it is requested that you do not ask tutors what grade your work is likely to achieve prior to final submission.

• Plagiarism and Academic Misconduct

Any work you submit must be your own original work. Any work that is plagiarised - this means submitting any item of assessment which contains work produced by someone else in a way that makes it look as though it is your own work will be subject to an academic misconduct review. This includes 'self-plagiarism' - you are not allowed to re-use work or significant sections from work, which you have already submitted for an assessment.

You are also not allowed to collude with others to produce work unless your assessment brief specifically outlines group work. Collusion means working with at least one other person to produce a piece of work that you then pass off as your own. You can discuss ideas for the work with other students, but you must not work with them to produce a piece of work together, you must not copy or share another student's work, and you must not lend your work (including drafts) to another student to allow them to copy your work.

If your piece of work is very similar to that of another student, you are likely to be accused of collusion. If you are found to have made your work available for another student to copy all or part of it, you may be referred for disciplinary action even after you have completed your award and are no longer a student of the University. You must not also falsify information, resources or data in any way.

These, and any other types of academic misconduct that are likely to give you an unfair advantage in an assessment, will be referred for investigation. Academic misconductthreatens the standards of awards we make, so we take this matter extremely seriously indeed and any student found guilty of this will have penalties applied and in the most serious of cases students with be withdrawn from the course.

2. Assessment Brief

Question 1

• Scenario

You work as a trainee accountant in an accountancy practice which specialises in accounting for charities. One of their clients is a local cat charity: The TBI Cat Rescue, which is registered with the Charities Commission for England and Wales (CCEW). You have been instructed by your manager to prepare, using the Charity Commissions template: CC16a, the receipts and payments account, for the year ending 31^stMarch 2024 and a statement of assets and liabilities as at 31^stMarch 2024.

TBI Cat Rescue exists for the benefit of the public to relieve the suffering of cats and kittens in need of care and attention and to provide and maintain rescue homes and other facilities for the reception, care and treatment of those animals.

The charity was established five years ago by a farmers wife as there was a large colony of feral cats living on the farm. One of the smaller paddocks was gifted to the charity to use for the location and building of a cattery and an office. At the reporting date, the current market value of the land is 95,000.

The charitys activities include:

• providing essential shelter, food and veterinarian care to cats and kittens
• co-ordinating the care and rehoming of cats and kittens
• offering a haven for feral cats

All cats and kittens rescued by, or surrendered to, the charity are taken to the vet and neutered / spayed, given de-flea and de-worm treatment, vaccinated, microchipped and given loving care and attention by the charity at the centre or within volunteers homes until they can go to their forever home.

The charity is well supported by the local public, as evidenced by the level of donations, legacies and support at fund raising events. To recognise this support, the charity holds an Annual General Meeting (AGM) which all interested individuals are invited to attend.

Five sheds were purchased during the previous financial year with a grant from the national lottery fund at a total cost of 20,000 and are expected to last for at least twenty years. The building of the pens within these five sheds cost approximately 18,000 and the contents of the pens cost another 8,000. The overspend was met from the charities own fund raising.

Within the paddock there are several large sheds housing cattery pens. Each pen can house between one and five cats or cats with a litter of kittens. Each pen contains bedding, a litter tray, food dishes, climbing frames, scratch posts and toys. There are also a few of these sheds that are currently empty.

For each shed purchased the company who the charity purchased them from gifted the same number again. Whilst the charity is very grateful for the gift, they are not able to refit these sheds without further fund raising.

Also located within the paddock is a large port-a-cabin donated by the local council which is used for the administrative offices of the charity. The current value of the cabin is roughly 1,000.

A few years ago, 75,000 in cash was gifted in a will with the explicit condition that the funds were only to be used for the payment of general vet bills.

This year the charity has been awarded several grants.

The first grant was received in May 2023 from CATSUK to be used for the building of additional pens in one of the empty sheds within the paddock. Any overspend should be met from the clubs own funds. Any underspend should be repaid to CATSUK.

A further grant, also from CATSUK, was provided in August 2023 to cover the costs of furnishing the new pens. This grant also carried the provision that any overspend should be funded by the charity with any underspend being held for the purchase of food for the CATSUK sponsored shed.

The trustees have decided to transfer 10,000 to a designated fund in advance of the installation of pens in one of the other sheds during the following financial year.

Also, during the current year the charity held several fund-raising events to raise funds for the operation of the charity:

• weekly coffee mornings with an opportunity to meet the cats homed at the charity available for adoption
• jumble sale of pre-loved clothing, books, etc
• monthly healthy cat check-up

The charity employs three full-time members of staff:

• charity manager who manages the volunteers and organises the fund-raising events
• a pet welfare officer and an assistant who ensure that the day-to-day welfare of the cats is maintained

There is also an extensive team of volunteers who help with a range of jobs maintaining the sheds and pens, collection of strays and abandoned cats, fostering cats in their own homes, etc. The volunteers are reimbursed for out-of-pocket expenses.

You have been provided with the opening Statement of Assets and Liabilities as at 31^stMarch 2023.

TBI Cat Rescue does not maintain separate bank accounts for each of their funds. The information given below provides a breakdown of the opening funds, as at 31^stMarch 2023.

You have also been provided with the following further relevant information as at 31^stMarch 2024.

On the attached spreadsheet you have been provided with a summarised cash book for TBI Cat Rescue and are required to produce the year-end financial report.

• Required tasks
  1. You should prepare the following statements:

• Statement of receipts and payments for the year ending 31^stMarch 2024
• Statement of assets and liabilities as at 31^stMarch 2024

using the CCEW CC16a template provided.

Provide appropriate workings and notes to accompany the financial statements.

(65 marks)

1. TBI Cat Rescue currently reports its financial affairs using the Receipts and Payments template provided by the CCEW. However, the trustees are considering whether SORP accruals-based reporting would be more appropriate.

Therefore, for the following transactions, you should prepare a written explanation to inform the Board of Trustees on how the following transactions:

• are currently reported using the receipts and payments format and
• how they will need to be reported if they switch to the SORP accruals-based accounting

• The disclosures for the 10 sheds owned by the charity
• The wages owed at the end of 31^stMarch 2023 and 31^stMarch 2024.
• The income raised from the weekly coffee mornings.

(15 marks)

Word limit: 500 words

(Total: 80 marks)

Please read the guidance notes in Section 3 and the marking criteria in Section 4 for further information on how to approach your assignment and optimise your grade.

Question 2

• Scenario

A few issues have arisen from a recent board of trustees meeting, and you have been asked to prepare a briefing note informing the trustees on what they need to do on each.

Issues identified

• The Receipts and Payments Accounts, the Annual Return and the Trustees Annual Report are completed by the trustees of the charity. However, these documents have never been externally verified.

• The volunteers are currently only reimbursed out-of-pocket expenses, and it is felt that a more substantial payment should be made in recognition of their services to the charity.

• A member of the public has requested a copy of the latest minutes of the Board of trustees meeting to clarify how the funds raised are being spent.

• With the increasing number of cats and kittens being rescued, funds need to be raised to build pens and fit out two (2) of the currently empty sheds to be able to accommodate them.

• Required tasks

The briefing note should include, for each of the issues identified above:

1. A clear statement of the issue faced by the charity in the case scenario.

(15 marks)

1. A critical discussion of why this issue is of significance for the charity drawing on relevant sources; Charity Commission (CCEW) guidance publications, Charity Acts 2011 & 2022, Charities SORP FRS 102(2019) and technical literature

(50 marks)

1. Relevant and informed recommendations to resolve the issue

(15 marks)

Word limit: 1,500 words

(Total: 80 marks)

3. Guidance notes
   • Question 1 a)

Ensure that you complete the CC16a template accurately, checking that you have not created any error messages in the template.

• Question 1 b)

Ensure that you clearly identify the differing accounting treatment for each of the transactions under both the R&P (cash-accounting) and SORP (accruals-accounting) bases. You should also show the different values that will be disclosed on the appropriate financial statements.

• Question 2

For each of the issues identified, you should provide a clear practical briefing note explaining to the trustees what it is they need to do. You should refer to the relevant technical guidance.

4. Marking criteria