FEASIBILITY_STUDY , item 14. PDF 1 MB - Meetings, agendas and ...

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A feasibility study prepared for the Black Box TrustNovember 20114 Financial Analysis4.1 OverviewThe accounts of the Black Box show that turnover at the venue has more than doubled since itopened in 2006 from just over £160,000 to around £360,000 in the year ended March 2010, anincrease of over 120% (see Table 4.1 below). (Audited accounts are not yet available for thefinancial year 2010/11.) All of the growth has been in the contribution of trading activities whichis over 3.5 times greater than in the first year of operation. As a result, the company hasreduced its grant dependency and almost 82% of income was self generated in 2009/10.Table 4.1: Income & Expenditure Account for Black Box, 2006/07 to 2009/102006/07 2007/08 2008/09 2009/10Incoming resources:Grants 80,000 88,100 81,545 65,000Contribution from trading activities 81,690 153,619 237,142 293,230Total incoming resources 161,690 241,719 318,687 358,230Self generated income 50.5% 63.6% 74.4% 81.8%Resources expended:Charitable activities 158,589 237,495 360,971 356,634Governance costs 3,007 5,368 3,232 3,300Total resources expended 161,596 242,863 364,203 359,934Net income /(deficit) for year 94 (1,144) (45,516) (1,704)Adjustment 6,072Total funds carried forward 94 (1,050) (40,494) (42,198)Source: Annual Accounts30
A feasibility study prepared for the Black Box TrustNovember 2011For the first four years of operation, the company did not make a profit on its operations (exceptfor a very small surplus in the first year). However, losses were small with exception of a largedeficit of over £40,000 incurred in 2008/09. This has been attributed to:an overspend on the renovations to the kitchen area,the new cafe taking a while to bed in resulting in wages increasing faster than income,andthere were a couple of self promoted shows with large outlays which did not do as wellas expected.The company has continued to operate since then as a going concern with the support of thebank and its major creditors.The 2010/11 accounts are not yet available but management accounts for the year show aprofit of just over £2,300.Table 4.1 also demonstrates that the company has steadily increased its self sufficiency from50.5% of self generated income in the first year of operation to 81.8% by 2009/10, despite areduced income from grants in the final year.4.2 Grant incomeThere are currently three main sources of grant income (see Table 4.2 below) – Belfast CityCouncil, Arts Council for Northern Ireland and the Department for Social Development (DSD).Initial funding for the establishment of the Black Box came from the Millennium Commission andamounted to £195,000Table 4.2: Sources of Grant Income, 2006/07 to 2009/102006/07 2007/08 2008/09 2009/10 % of totalBelfast City Council 10,000 15,700 25,300 25,000 38.5%DCAL 50,000 0 0 0Arts Council NI 0 12,125 37,125 25,000 38.5%Laganside 20,000 0 0 0DSD 0 60,275 19,120 15,000 23.1%Total grants 80,000 88,100 81,545 65,000 100.0%Source: Annual AccountsWe understand that total operational grant funding for the Black Box in the current year(20111/12) amounts to £61,000 and comes from the same three sources:Belfast City Council funding is provided under development funding from the CuturalTourism department and is awarded annually. The Black Box was awarded £25,000 forthe current year. In future the Black Box would envisage applying for multi-annualfunding;31
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