INFORMATION FOR MEMBERS ON FINANCIAL POSITION DURING COVID19 EMERGENCY
Introduction
The coronavirus lockdown has resulted in cessation of all but essential activity at Eaton Park. This has affected both club meetings and the operation of the railway.
For the purposes of financial planning the committee has made a conservative assumption that the railway will not operate for the public before May 2021 and thus there will be no income from that source until that time. It also assumes that railway income will be lower than historic levels for the period May 2021 to September 2021. Club type activity may be able to commence before that depending on Government directives. The committee has also decided that no expenditure will be incurred in the meantime other than committed, contracted or other unavoidable expenditure. The committee has considered it to be prudent to plan for a worst case scenario in a situation where the future is still largely unknown
The lack of railway income and the commitment to spend £11,520 on a new toilet block, as mandated by the membership at the 2019 AGM, has resulted in the need to find other sources of finance to cover the period to May 2021 when railway income is assumed to resume albeit at a reduced level.
Sources of Finance
A loan of some £7,000 from the Northern Federation related to the toilet installation is not likely to materialise as their approval committee is not planning to meet in the foreseeable future.
A sum of £10,000 was received from the Government under a new coronavirus relief scheme. This is a grant and does not need to be repaid but is also considered as income for taxation purposes. It is exempt from our 20% charitable obligation.
A loan of £5,812 from HSBC bank has been applied for. This is a Government backed scheme and the loan is on very favourable terms with no interest for the first year and no penalty for early repayment should finances permit this or other sources of finance become available.
Cashflow for the period to June 2021
A cashlow statement for the 15 month period from April 2020 until June 2021 has been prepared and issued to members by e-mail and is based on the assumptions noted above of:
- No railway income till May 2021 and then at a reduced average rate of £200 per weekend
- Grant from Government and HSBC Loan
- Expenditure kept at a minimum in the meantime
The forecasted bank balance is £3,674 at the end of April 2021 and before railway operations are assumed to commence. Should the worst happen and the railway does not open in May 2021 other sources of finance may need to be considered. This could include, as a last resort, disposal of club assets.
Conclusion
The coronavirus emergency has disrupted club and railway activities but the committee are confident that with the financial measures taken the future is assured beyond the end of the current crisis.