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Report to the States of Jersey Department for Education, Sport and Culture Jersey Heritage Trust Financial and Business Review Part I – Detailed Findings March 2010 BDO Alto Limited Jersey Heritage Trust March 2010 Minister for Education, Sport and Culture BDO Alto Limited PO Box 142 Windward House, La Route de la Certain content, such as details relating to staff salaries, which were included in Liberation, St Helier, Jersey Jersey, JE1 1BG our draft report have been redacted due to the sensitivity of the information, in the JE4 8QJ Telephone +44 (0) 1534 510 100 event that this Report does not remain confidential to the ESC team. Facsimile +44 (0) 1534 759 425 Web site: www.bdo-alto.com The scope of our work is set out in our engagement letter. We emphasise that our enquiries would not necessarily disclose all matters of significance to you relating to Jersey Heritage. We have not carried out any audit work on the financial information included in our report and we express no opinion thereon. Dear Minister We present and comment on the projected results of Jersey Heritage, which are solely the responsibility of the Trust. Since projected results relate to the future, In accordance with your instructions, confirmed in our engagement letter dated 15 actual results are likely to be different from those projected, because events and October 2009, we have prepared a Report on Jersey Heritage Trust (referred to circumstances frequently do not occur as expected. The differences may be herein as the “Trust” or “Jersey Heritage”). material. This Report was prepared in connection with your review of annual and one-off The Director and Finance Director of Jersey Heritage have reviewed a draft copy grant funding being provided to the Trust by the Education, Sport and Culture of this Report. They have confirmed to us that there are no material errors of fact Department (“ESC”). or omission in the context of the scope of the Report. Their comments have been reflected, where we deem relevant, in this Report. The objective of this Report is to present the current financial position of the Trust, to consider financial forecasts and business plans and to review governance We would like to express our appreciation for the assistance and co-operation arrangements. This in turn will enable ESC to develop a deeper understanding of received from the Trustees, Directors, management and staff of Jersey Heritage, the position of the Trust, as well as its medium to longer term operating and and the Ministerial Team, Officers and staff at ESC during our work. financial opportunities and risks. Yours faithfully This Report is intended solely for the use of the Minister, ESC Officers and their advisers. It is based on the latest information made available to us and we accept no responsibility for events after the date of issue. Whilst it is our understanding that you may be required to put this Report into the public domain, we do not, in preparing this Report and giving the opinions stated herein, accept or assume responsibility for any other purpose or to any other person to whom it is shown or into whose hands it may come save as expressly BDO Alto Limited agreed by our prior written consent. If others choose to rely on the contents of this Report, they do so entirely at their own risk. Jersey Heritage Trust March 2010 Term Meaning 2006A Actual results for the accounting year to 31 December 2006 2007A Actual results for the accounting year to 31 December 2007 2008A Actual results for the accounting year to 31 December 2008 9M 2009 Actual results for the 9-month period ended 30 September 2009 AJC Association of Jersey Charities AMF Ancient Monuments Fund BDO BDO Alto Limited, author of this Report C&AG Comptroller and Auditor General ESC Education, Sport and Culture Department F&T Forts and Towers FTE Full Time Equivalent FY Financial year (runs 1 January to 31 December) GAAP Generally accepted accounting principles JEP Jersey Evening Post KPIs Key performance indicators MLA Museums Libraries Archives Council NGO Non-Government Organisation P&E Planning and Environment Department Q1, Q2, Q3, Q4 Quarter 1 (January to March), Q2 (April to June) etc … SFCG Sir Francis Cook Gallery SLA Service Level Agreement Societe The Societe Jersiaise SOFA Statement of Financial Activities SORP Statement of Recommended Practice on Accounting and Reporting by Charities States The States of Jersey TDF Tourism Development Fund Trust Jersey Heritage Trust VSA Visitor Services Assistant YTD Year-to-date Definitions, abbreviations and glossary of terms Jersey Heritage Trust March 2010 Report Contents 4 Legal structure & governance.................................. 30 Legal structure .................................................................................30 Contents ............................................................................................ 4 Constitution .....................................................................................30 1 Summary of findings ...................................................6 Governance......................................................................................31 Appointment and induction of trustees............................................31 Scope of work ................................................................................... 6 Delegation of authority to management...........................................32 Overview........................................................................................... 6 Other boards, committees and advisory panels ...............................32 Key findings...................................................................................... 7 Observations arising from our individual discussions with the Detailed findings............................................................................... 8 Trustees .........................................................................................34 Timeline and next steps..................................................................... 8 Current developments......................................................................36 Funding mechanism ........................................................................ 14 Other governing documents.............................................................38 Barriers to restructure?.................................................................... 14 Reporting and management information .........................................44 Proforma statement of income and expense.................................... 14 Interaction between JHT and other heritage organisations..............44 2 Background................................................................16 5 Organisational structure........................................... 53 A declining financial performance .................................................. 16 Board of Trustees.............................................................................53 A changing environment ................................................................. 17 Directors ..........................................................................................53 Access to Elizabeth Castle .............................................................. 17 Senior management forum...............................................................53 Access to capital funding ................................................................ 18 Human Resources function..............................................................54 A serious liquidity issue .................................................................. 18 Remuneration and benefits ..............................................................54 Training............................................................................................54 3 Activities of Jersey Heritage.....................................20 Investors in People...........................................................................54 Heritage defined.............................................................................. 20 6 Financial overview..................................................... 56 Evolution of Jersey Heritage’s activities......................................... 20 Jersey Heritage’s Mission ............................................................... 22 Financial reporting framework ........................................................56 Monitoring of achievement of Trust principles............................... 24 Designated Funds ............................................................................56 The value of heritage....................................................................... 24 Restricted Funds ..............................................................................57 States Statistics Unit – Survey on Heritage in Jersey...................... 25 Heritage Funds ................................................................................58 States Economics Unit – Economic Significance of Heritage ........ 25 Unrestricted fund .............................................................................59 Accreditation as a measure of performance .................................... 26 Proforma statement of income and expense ....................................60 Seasonality.......................................................................................62 Normalised performance - Unrestricted Fund .................................65 Cash flows .......................................................................................68
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