some additional images to help

Thanks Warner Décor, some great tips. I have added some images and more are uploading to assist in visualizing the space.
I guess I should have mentioned we have a small en-suite bathroom with shower and loo (includes vanity with large white framed mirror).

The bathroom vanity

glamourazzi-wall-mirror/ is really cool

Thanks for attaching those! Here are a few ideas for art in the bathroom:

http://deciture.com/beautiful-summertime-blossom-metal-wall-decor/

http://deciture.com/creative-styled-attractive-metal-butterfly-plaque/

http://deciture.com/elisia-ceramic-birds-wall-decor-set-of-3/

http://deciture.com/seretha-gold-leaf-wall-decor/

Hope this helps you!

That mirror is actually one of my favorites and it definitely is modern :) It also would imitate the circles in your artwork.

Are you able to paint the room as a whole? If so, a color that would look great in this room is called a Peacock Blue- by Benjamin Moore. It will bring liveliness to the room. Are you looking to keep the carpet? A suggestion would be a more sold colored carpet and a patterned colored rug instead. Also place some half curtains over the windows, that way you can still have light while blocking the major sun rays out. Hope these tips help, good luck with everything!

We are thinking of painting but since it is the basement we wanted to create something in white with the cupboards, art and accessories being the colour splashes. We will certainly use your tip for our upstairs area where the is a lot of sunlight - the blue will be perfect!

What we ideally would have some advice perhaps on layout - can we improve on desk and bed positions? Is their a possibility of a craft station as well? What do you guys think?

Although it's nice to have the desk under the window, I think I'd move the bed to that wall so the cupboards were accessible. Place the desk or the shelves where the bed is now. Are you using the glass topped table/desk? Do you have a drawing of the layout of the room?

I would put the bed where the Ikea Expedit shelving is now so you get access to the closet doors, as hatetoshop said. I would put the shelves on their side, between bed and window, or where the glass desk is, or if it fits keep them on the long side and put them under the windows.
Create sort of a half wall between bed and cupboards and make a long desk on the side of the cupboards. Make the half wall just a bit taller than the height of the desk, so you have a nice buffer between the bed area and the work area, but you can still look over the wall when you're sitting down.

If you're keeping the carpet tiles, you could something funky with the closet doors, paint them in the colours of the tiles. Or you could use a wall decal...

Fantastic, these are the great ideas I'd hoped to get. I will load a floor plan for better perspective on area

The layout is not exactly to scale but hopefully it illustrates the space. I fully agree with changes suggested by both carolins and hatetoshop. What do we do with the glasstop table? Retire from use? Would be awesome to have a circular craft table?

I will get a layout as per suggestions on shortly...
Thanks

Even seeing it on paper it already looks better!

The bed could probably fit in any orientation - it might look like it on the drawing but in actuality there is a chance the head of the bed could also be the halfwall - that way guests could wake up seeing monkeys through windows instead of the kitchenette??

Now that is more like it :-)

With the headboard against the half wall, is it difficult to get to other side of the bed? I'd put the head against the window wall. You might be able to fit a small (36"?) round craft table in the centre.

And I would put the desk with the long side against the half wall so it is parallel to the cupboards. Only way to figure out if you'll have enough space for the bed if you put it with the back against the half wall is to measure, measure, measure :-)