Financial Statements 2011
Direct Photo Rene Keijzer
Foreword Dear reader, 2011 was an extremely turbulent year for Buma/Stemra. Intense discussions about developments in copyright, radical changes in governance and organisation, and last but not least considerable publicity. Buma/Stemra operates in a sensitive market, with many opinions and views about temporary and future strategies, about the development and enforcement of copyright and standing up for the interests of our members and copyrights owners.
This task makes great demands on the quality of our work, persuasion powers and the effectiveness of our communication. An open and good collaboration in the political field is needed to powerfully protect the interests of intellectual property as well as making clear decisions about topics as illegal downloading and fair use of copyright. Since taking office, I have observed this focus on quality and influence. Of course not everything goes flawlessly in our extremely complex market with its great diversity of copyright. But learning has undeniably come from these mistakes. In many respects I have found a continuously learning organisation. Both within and outside the organisation I have been given a warm welcome. I am grateful for that as it always takes some time getting used to having someone from outside. In a short time I have learnt a lot from many – sometimes I even get the impression that not everyone notices straightaway that I have not been there very long.
The General Assembly (ALV) of February 2012 adopted the governance proposals with a majority of about 92%. In May 2012 the statutory translation of these decisions will be presented to the ALV, with the final appointment of 12 new board members and an independent chairman. Also the members council will then be installed. One and a half years later the external evaluation will follow, the results of which are decisive for further decision making about size and constitution of the Board. The coming time there will be again more space for dealing with important intrinsic issues. A properly functioning managerial organisation is self-evident for members. Members ask nothing else than what’s in it for me? Ultimately the interests of members are at the heart of a collective rights manage ment organisation. That is our focus. For me personally, it is a privilege to be allowed to chair this creative and inspiring community.
Leo de Wit, The current Board has taken a brave decision to restructure the governance of Buma/Stemra. That is also my priority.
Chairman of the Board a.i.
Noteworthy in 2011 •
launching mijnlicentie.nl,
•
robust innovation of our organisation, such as halving the Board
where music users can arrange nearly all licences of Buma, Sena, Videma and Reprorecht in one go •
start of fingerprint technology and publication of unclaimed works, so that all music authors can receive the
•
€ 143.2 million distributed to
compensation that they are entitled to
songwriters, composers and publishers
•
•
€ 11.7 million allocated to social and cultural purposes
growth of Buma to 20,000 members
Table of Contents
Foreword
Key figures Buma 5-year overview for 2007-2011
03 06 10
Stemra 5-year overview for 2007-2011
Board report
Directors’ report
11 12 18
05
Buma Financial statements 2011
Stemra Financial statements 2011 Composition of the Board and the board of directors
36 66 91
Buma/Stemra
Key figures Breakdown of 2011 turnover in percentages - Buma
Breakdown of 2011 turnover in percentages - Stemra
1,0%
5,7% 8,3%
Performing Rights Online Licensing
9
39,1%
Sales Outlets
8,3%
,7% 13
Performing Rights Abroad
,0%
36,3%
Mechanical Rights Online Licensing
5,4 %
Cable
1 0,5
Stage
,7 %
,3 %
12 ,2 %
Mechanical Rights Abroad Special Licensing/ Private Labels
Workplaces Catering
Radio & TV Performing Rights
19
14
Home Copy/ Lending Rights
%
Radio & TV Mechanical Rights Biem Phonomechanical Rights/Central Licensing
1 6,4 %
Results Buma
Financial result
Results in â‚Ź millions
Operating result
Results on ordinary activities
30 20 10 0 -10 -20 -30 2007
2008
2009
2010
2011
10,4 -12,0
-7,8 -12,2
8,3 -13,2
8,5 -13,6
7,8 -16,9
-1,5
-19,9
-4,9
-5,1
-9,1
Results Stemra
Financial result
Results in â‚Ź millions
Operating result
Results on ordinary activities
6 4 2 0 -2 -4 -6 -8 2007
2008
2009
2010
2011
4,3 -4,0 -0,3
-1,1
4,2 -4,6 -0,4
4,8 -4,6 -0,3
2,0 -1,9 -0,1
ANNUAL REPORT 2011
-5,0 -6,1
07 Turnover Buma Turnover in â‚Ź millions 145 140 135 130 125 120 115 110 105 2007
2008
2009
2010
2011
129,4
140,0
136,4
140,3
142,9
Turnover Stemra Turnover in â‚Ź millions 50
40
30
20
10
0 2007
2008
2009
2010
2011
51,6
45,0
40,7
35,7
32,1
Staffing Levels Buma/Stemra As per year End 200
150
100
Part-time FTE 50
Full-time FTE Number of Staff
0 2007
2008
2009
2010
2011
2011
63 111
57 105
59 115
57 118
59 113
198
Buma/Stemra
Key figures Turnover segmentation Buma (x € 1.000)
2011
2010
2009
2008
2007
Radio & TV Performing Rights
51,863
50,228
51,329
52,541
45,714
Live
20,363
19,899
21,513
20,799
18,249
Hospitality Industry
15,047
17,015
14,663
14,710
15,744
Workplaces
17,600
17,799
13,777
15,215
15,143
Shops and stores
12,827
11,940
11,716
11,901
11,427
1,471
757
893
946
840
Cable
11,886
12,168
12,396
13,035
12,292
Performing Rights Abroad
11,891
10,540
10,153
10,857
10,023
142,948
140,346
136,440
140,004
129,432
Turnover segmentation Stemra (x € 1,000)
2011
2010
2009
2008
2007
Biem Phonomechanical Rights / Central Licensing
12,564
16,684
18,229
19,866
24,599
Special Licensing / Private labels
6,319
6,306
5,656
8,860
9,930
Radio & TV Mechanical Rights
5,285
5,138
7,266
6,211
5,276
Mechanical Rights Online Licensing
1,835
515
1,314
1,219
1,664
Home copy / Lending Rights
1,744
3,223
3,533
4,184
4,269
Performing Rights Online Licensing
4,391
3,796
4,682
4,701
5,838
32,138
35,662
40,680
45,041
51,576
Mechanical Rights Abroad
Distribution by Buma
Distribution by Stemra
Royalties in € millions
Royalties in € millions
140 130 120 110 100 90 80 70 60 50 40 30 20 10
60 50 40 30 20 10
0 2007
2008
2009
2010
2011
2007
2008
2009
2010
2011
11,6 39,0 60,4
11,3 43,6 68,0
10,4 43,3 69,9
10,2 46,5 67,4
9,6 43,8 70,3
3,0 5,0 6,8 39,3
0,6 4,0 7,4 34,8
0,7 3,8 5,6 34,1
0,2 3,1 5,0 28,5
0,2 3,1 4,5 24,4
Fund for Cultural and Social Purpose
ANNUAL REPORT 2011
Foreign Organisations
Central Licensing
Administration Costs
Members and participants
Foreign Organisations
Members and Participants
Dio Photo Patrick Visser
Buma 5-year OVERVIEW for 2007-2011 (x â‚Ź 1.000)
2011
2010
2009
2008
2007
Members and participants
70,345
67,440
69,943
68,034
48,736
Foreign organisations
43,799
46,549
43,269
43,645
39,029
Funds for cultural and social purposes
9,581
10,212
10,395
11,294
11,618
Administration costs
1,838
2,151
1,940
1,769
1,717
Distributed in the reporting year
125,563
126,352
125,547
124,742
101,100
To be distributed at year-end
170,504
162,211
156,536
153,816
151,991
Turnover
142,948
140,346
136,440
140,004
129,432
3,151
3,357
3,140
3,033
2,709
Expenses
-20,060
-16,919
-16,908
-15,752
-15,142
Operating result
-16,909
-13,562
-13,768
-12,719
-12,433
7,817
8,496
8,849
-7,225
10,912
-9,092
-5,066
-4,919
-19,944
-1,521
Total turnover index (2007 = 100)
110.4
108.4
105.4
108.2
100
Operating costs index (2007 = 100)
132.5
111.7
111.7
104.0
100
14.0
12.1
12.4
11.3
11.7
95.1%
98.5%
104.6%
97.5%
96.0%
Distribution
Profit and loss account
Income
Financial result Result for the year
Key index figures
Operating costs as % of turnover Distributed in the reporting year as % of (turnover last year -/- result on ordinary activities last year)
* Adjusted for comparison purposes
ANNUAL REPORT 2011
11
Stemra 5-year OVERVIEW for 2007-2011 (x â‚Ź 1.000)
2011
2010
2009
2008
2007
24,394
28,493
34,128
34,829
39,251
4,459
4,964
5,638
7,378
6,770
225
195
671
592
2,990
3,133
3,098
3,828
4,099
5,006
Distributed in the reporting year
32,211
36,750
44,265
46,898
54,017
To be distributed at year-end
38,738
38,755
40,863
45,438
49,175
Turnover
32,138
35,662
40,680
45,041
51,576
3,801
3,700
4,377
4,728
5,418
Expenses
-5,697
-8,241
-9,107
-9,865
-9,567
Operating result
-1,896
-4,541
-4,730
-5,137
-4,149
Financial result
1,952
4,821
4,319
-993
4,433
56
280
-411
-6,130
284
Total turnover index (2007 = 100)
62.3
69.1
78.9
87.3
100
Operating costs index (2007 = 100)
59.5
86.1
95.2
103.1
100
Operating costs as % of turnover
17.7
23.1
22.4
21.9
18.5
Distribution Associates and participants Foreign organisations Central Licensing Administration costs
Profit and loss account
Income
Result for the year
Key index figures
* Adjusted for comparison purposes
Buma/Stemra
Ferry Corsten Photo Roy Laros, Betribes.com
Board report
BOARD REPORT
We present you with the annual report of Vereniging Buma (Buma Association) and Stichting Stemra (Stemra Foundation) for the financial year 2011. The annual report comprises the Board report, the Directors’ report and both sets of financial statements.
1. Financial statement The financial statements have been audited by KPMG Accountants N.V. and have been issued with an unqualified independent auditor’s report. We recommend that you approve and adopt the financial statements for 2011 of Buma and the financial statements for 2011 of Stemra, including the board of directors’ proposals, and to discharge the Board and the board of directors.
actualization of the regulation. The review on actuality and usefulness has led to various adjustments.
Implemented adjustments Examples of implemented adjustments are processing of fingerprinting in commercials and a separate subsequent payment over the years 2008 and 2009. Furthermore, adjustments have been made to such matters as flexible rights administration, differing distribution keys for Dutch works, and collection from Stemra from publishers with NS-authors.
Non-implemented proposals A number of proposals have not been implemented. These were proposals about reducing the complaint period, the separability of text and music in plagiarism and a proposal about flexible online rights administration (flexco).
2. Meetings The Board met eight times in 2011.The majority of attention was focused on the set-up of the governance, a new Board structure and the expansion of transparency. Furthermore, in nearly all of the meetings, we have paid attention to the future of Stemra and in view of the negative publicity, the press and public affairs policy. Other matters that were discussed in the consultations in the past year, were: • the financial statements 2010 and the 2011 and 2012 budget • investment policy • strategy • constitution of the management committees • set-up of a committee Buma 100 years • the ban on downloading from illegal sources • the policy of Buma Cultuur
The coming period In 2012, together with the Board committee Distribution Streams, we are going to direct our attention to topics as the specification of distribution keys. We will do this based on the use of music, reference repertoire, a more transparent allocation of funds and by obtaining specifications of music use in the sector amusement live (stage).
4. Departure Cees van Rij Halfway through 2011 Buma/Stemra decided to terminate the employment relationship with Cees van Rij. Since March 2010 Cees van Rij was vice-chairman of the statutory board of directors of Buma/Stemra. Furthermore, he was responsible for Legal Affairs, RTV/Cable and Foreign affairs. As of 12 September 2011 Anja Kroeze is appointed as General Counsel, manager Legal Affairs and RTV/Cable.
• the addressing of performing artists as principally responsible
for providing repertoire and performances
5. The General Assembly The Joint Members meeting of Vereniging Buma and the Meeting of Affiliates of Stichting Stemra took place on 23 May 2011 at the Grand Hotel Krasnapolsky in Amsterdam The members gave their approval to the financial statements 2010 of Buma and the financial statements 2010 of Stemra and discharged the Board and the board of directors for its policy.
6. Appointments 3. Review of distribution rules In 2011 the Board and Board committees reviewed, in consultation with the board of directors, the distribution rules. This is a continuous process of investigation and
ANNUAL REPORT 2011
At the General Assembly of 23 May 2011 Henk Alkema, Hans Kosterman, Bobby Sukhraj and Arno van Berkel were appointed as members of the Buma-Board. Hans Everling, Bèr Deuss and Niels Walboomers were appointed as members of the Stemra-Board.
15 In memoriam: Henk Alkema On 4 August 2011 Henk Alkema passed away. On 23 May, just a few months before, he was appointed as board member on the recommendation of Beroepsvereniging voor Componisten en Multi Media (BCMM). We lost a skilful manager and someone who lived for music. Alkema was trained as pianist by Leon Orthel at the Royal Academy of Music in The Hague. Later he studied orchestra management. He composed, played the piano, conducted, worked in theatres, concert halls and studios. At the Utrecht Academy of Music (HKU) he taught composition and ensemble conducting and he was (interim) director. Alkema wrote two full-length operas, songs, orchestral works, chamber music, light music and film music. For his opera Bonifacius he received the Bernlef award.
7. Departure of Chairman of the Board Konrad Boehmer During the General Assembly (ALV) of May 2011 Konrad Boehmer took his leave as chairman of the Board. Boehmer has a long history with us. In 1971 he came as a representative of the GeNeCo in the Board of Trustees to promote the interests of contemporary composed music. In 1980 the statutes were thoroughly amended and he joined the new Board. From 1988 to 2006 he was vice chairman of BUMA. In 2006 both Boards appointed him as chairman.
Wide commitment As well as his board work, Boehmer devoted himself to Dutch music in many other areas. He wrote about it in Vrij Nederland, and for many years he was a member of the board and chairman of the GeNeCo, a member of the Arts Council, member of the board of the Federation of Artists Associations, member of the board of STEIM and member of the board of the ConcertZender.
International He was also internationally active as a member of the board of the Confédération de Musique Electroacoustique, chairman of CIAM, member of the board of CISAC, vicechairman of the European Composers Forum and vicechairman of BIEM. This international presence provided a lot of valuable information for Dutch authors. Also this regularly enabled us to have influence on important decisions regarding copyright at a high international level.
Balance Boehmer, as our Chairman of the Board, did not just have an eye for the interests of serious music, but constantly upheld the interests of all authors. He saw it as his task
to bring together the interests of authors, publishers and the organisation Buma/Stemra in a well-balanced way. The restructure of governance which ultimately took shape in 2012, has for many years been one of his fervent wishes.
Grant By way of thanks for his more than 40 years unremitting commitment to copyright, we unveiled the Dr. Konrad Boehmer Grant during the General Assembly of May 2011. This grant, worth € 45,000, gives financial support to projects for strengthening the social-economic position of authors through lectures, investigations, debates or publications. Boehmer was active as a member of the Stemra Board and chairman of the Governance committee till the end of 2011.
8. Board and governance changes Interim Chairman of the Board appointed On 21 December 2011 we appointed former Chief Public Prosecutor Leo de Wit as interim-chairman. This appointment has partly been made possible by the decision of the members to look for an independent chairman. This was laid down in the statutes in May 2011. Leo de Wit is, as special assignment, supporting the supervision of the restructuring of governance.
Procedure By appointing the Governance committee in April 2011, we have started off the restructuring of governance. As a result, the members agreed on the broad outlines of the presented Governance model at an extra General Assembly on 16 February 2012.
Proposal new management structure set-up in 2012 One of the most essential parts of the restructuring of governance is the reduction of the Board from 24 to 12 members. The new Board will consist of eight authors and four publishers, led by an independent chairman. The board members will have to comply with what is stated in a profile. Furthermore, board members will be allowed to have a seat on the Board for a maximum of two periods of four years. In addition, board members
Buma/Stemra
BOARD REPORT
may no longer fulfil a management position in other collecting societies.The halving of the Board is part of an extensive set of actions. The most important of these actions are: • the appointment of an independent chairman of the Buma/Stemra Board • the establishment of a members’ council with policy preparation and advisory powers • the choice for the board-management model • the introduction of the Quality Model, developed by the Dutch Quality Institute, which includes more control mechanisms through a system of internal and external audits and evaluations • the organisational separation of safeguarding interests
and integral managerial responsibility • the participation of members in committees, together
with board members and members of the council • the introduction of a managerial code of conduct,
including an integrity code
Audit At the end of 2013 an external audit committee will review the quality of the Board. The results of this audit – provided with a managerial advice – will be submitted to the members for further decision-making.
9. Publicity Buma/Stemra considers it is important as a promoter of the interests of music authors and publishers, to take a visible place in society. We set great store by bringing into the limelight what we stand for. For members it must be clear in what way their interests are being served and music users must know what happens with the money that they pay for the use of music. Buma/Stemra does this all year round via the media, own publicity, the provision of information to members and users and via the Buma Cultuur events. Unfortunately we also have to acknowledge that in 2011 we were faced with a number of publicity incidents. Frequently members express their dissatisfaction, also
ANNUAL REPORT 2011
via the media. These incidents have had negative consequences for the image of Buma/Stemra. This attention has also had an impact on the political opinion about Buma/Stemra, collecting management and the future of it. Meanwhile, against this backcloth the Supervisory Board is conducting an investigation into the background of the claim of composer Melchior Rietveldt, the role of Mr Gerrits in this and the overall performance of Buma/Stemra. Buma/Stemra has let it be known from the outset that it will give full cooperation to these investi gations and awaits the outcome with confidence.
Baskerville Photo Ben Houdijk
Jacqueline Govaerts Photo All Access Entertainment
Directors’ report
directors’ report
1. In short Distributions Buma equivalent to previous year This year Buma distributed € 114.1 million to rights owners, in 2010 it was € 114.0 million. The turnover of Buma has risen at an average of three million euro annually in the past two years. The effect of this increase on the distributions will not be noticeable until 2012. In the first couple of months € 5 million more has already been distributed to post-distributions general rights, film and satellite, than in the same period in 2011. Also the distribution from foreign societies in 2012 is nearly € 2.5 million higher than in 2011.
new music services which have started. And for the music users there is now mijnlicentie.nl: a basic registration with a digital service desk where, as of June 2011, fee payers can pass on, view and change their details about the use of music, image and text.
Organisation adjustments In order to have these and many other developments run smoothly and efficiently, we have adjusted our organisation. Departments have been combined and responsibilities reinvested. In this directors’ report you will find more clarification about these adjustments and improvements.
Distributions Stemra decreased Stemra distributed € 29.1 million to right owners (in 2010 it was € 33.7 million). The decrease is due to the drop in the turnover of Stemra. The last two years this was well over four million euro on average per year. This is mainly due to the continuing decrease of the sale of physical music carriers and through the political discussion about the Home Copying Scheme. Furthermore, partly due to the absence of a download ban from illegal sources, the online turnover is falling behind.
2. Organisation Board of directors and management team In March 2011 an operational management team was set up. This consists of managers who are responsible for the essential processes within the organisation. The chairman is the chairman of the board of directors. The goal of this team is to improve the information services and the reporting about operational matters to the management. Furthermore, action can now be taken more swiftly and decisively.
Growth of Buma to 20,000 members In March Buma enrolled its 20,000th member. This growth shows that music authors and composers still see us as the organisation to protect their interests and to arrange a fair remuneration for the use of their music.
Works Council In its role of representing the interests of the Buma/Stemra co-workers, the Works Council has had regular consultations with the board of directors, six times in the last year. The most important issues which came up for discussion were the Service Centre, whereby in particular attention was paid to the transfer of Buma’s field workers to the Service Centre, the complaints project, a number of internal organisational changes and the future of Stemra.
Strategy Improved service Research indicates that we can still improve quite a lot. Therefore in 2011 we implemented a program of innovation. Pivotal to this is the quality of our service and the communication with our members and affiliates. We have started with the improvement of the processing of complaints and we launched the new Buma/Stemra-website and the Buma Songtracker app, which gives right owners real-time insight into the use of their works. To enhance the quality of distribution we have deployed fingerprinting, to identify music in commercials. In addition to this we have developed an approach through which we obtain more information about the use of music at live-performances. We react proactively to collection on the many
ANNUAL REPORT 2011
The strategy of Buma/Stemra continues to be directed to: • maximizing the collected royalties • fighting for a fair remuneration for our members and defending legislation for the protection of copyright in the digital present and the future • optimising distribution and distribution processes • enhancing the service orientation • improvement of quality and intensity of communication with members
Organisational developments and improvements During the General Members Meeting on 23 May 2011 the results were presented of an independent investigation into the Collecting Societies (CSs), including Buma/Stemra. Respondents indicated as important areas for improvement:
21 • the communication and transparency (think of the website
and online services); • the quality and speed of service and the distributions. This investigation also led us to give a high priority to the addressing of these points in 2011. Consequently a lot of work has been done to actualize improvements in these areas, in new projects as well as those already initiated. Some improvements have already been implemented and noticeable, others will be noticeable in 2012. Below you can see the improvements that we actualized in 2011.Some we have taken up together with other CSs or with market parties.
Improvement communication and transparency Service Centre Copyright and Related Rights (the Service Centre) The setting up of the Service Centre as an organisation that is responsible for invoicing and collecting on behalf of Buma and Sena, has proved to be an effective approach to the market. We owe the growth of the number of licences to the efficiency improvements brought about by the Service Centre. 2011 was the first year that the Service Centre actually invoiced all the individual licences for the use of music on behalf of Buma and Sena.This year, via the Service Centre, we also started with the joint mailing of potential music users. Clients are thereby asked for information only once. Combining Sena and Buma’s field workers further contributed to improving efficiency. Mijnlicentie.nl Mijnlicentie.nl was launched to make it easier for music users to arrange their licences with Buma, Sena, Videma and Reprorecht in one go. Every entrepreneur can now, in just a couple of simple steps, get information online from all four organisations about the fees and conditions, arrange licences and view and manage their own details. Working group Pastors On 6 September 2011 Marco Pastors, independent chairman of the Working Group Improvement Collection Royalties, presented his final report to State Secretary Teeven. He reported that the consultations in the working group between VNO-NCW, MKB the Netherlands (Small & Medium Sized Enterprises the Netherlands) and VOI©E has produced good results. Pastors referred to the previously mentioned foundation Service Centre Copyright and Related Rights, the CS hallmark and the complaints and disputes settlement.
In addition, the compensation for branch services – budget neutral – has been harmonised. Also the indexing of the fees of Buma, Sena, Videma and Reprorecht has been harmonised. Only the harmonisation of the fee basis has not yet produced concrete results.
Hallmark Collecting Societies (CS) On 23 November 2011 we received a certificate for the CS hallmark from Jan Willem Holtslag, chairman of the College of Supervision Copyright. Hence a hallmark We are one of the initiators of VOI©E, which stands for Vereniging van Organisaties die Intellectueel eigendom Collectief Exploiteren ( Association of Organisations that Exploit Intellectual Property). Since 2008 we have worked together to foster transparency and quality in the collecting societies sector. At the start we laid down a common code of conduct. We wanted to turn this code of conduct into a CS hallmark, in order to encourage Collecting Societies giving insight into their performance, that they make norms easily and objectively verifiable in the form of hallmark criteria and that these are assessed by an independent certifying institute. We have succeeded in obtaining the hallmark certificate. Development and testing The hallmark criteria are drawn up by a committee of interested parties, in which representatives of users – appointed by VNO-NCW and MKB Nederland (Small & Medium Sized Enterprises the Netherlands) – have 50% of the votes. The hallmark criteria are annually tested by a hallmark institute. This institute gives a binding advice about the granting or revoking of the hallmark. An affiliated CS must comply with the Directives and regulations for good governance and integrity that the College of Supervision Copyright oversees. These directives include the transparency of governance, independent supervision of the board of directors and contains a whistle blower regulation with an external independent contact point.
Buma/Stemra
directors’ report
We are also certified
Norms
New portal In the second half of 2012 our new Buma/Stemra-portal is being launched. The principle of this portal is that the client occupies centre stage. The new portal is therefore more explicit and visually more attractive with a lucid complaints status and clear overviews of soundfiles, live-performances, registered titles and catalogues. Such a new portal was the wish of many rights owners.
The interests of rights owners are safeguarded in the norms. For instance, investments or allocation to socialcultural funds. Also transparency in the contact with users is laid down – about for example, the represented rights, fees or compensation principles –. Furthermore there are norms for the quality of services, such as updating the address database and the processing of transactions. There is a uniform complaints and disputes settlement established for users. And there are norms for providing openness in matters about the financial data, the costs and the timely distribution of funds.
Quality and speed of service and the distributions
Meanwhile, we too meet the CS hallmark criteria.The financial statements for 2011 have even been completely adjusted to the relevant criteria. For example, the presentation of the cash flow statement has been changed and a number of notes extended.
Buma Jr. In 2011 we started with the development of Buma Jr. (Junior). Buma Jr. is a new and free of charge platform for young composers and authors. Designed to advise them about their copyright and to help them on their way with their musical career. On bumajr.nl they can come into contact with professionals from the music branch, make use of exclusive discounts, promote their own numbers and get to know everything about copyright. In the first months after launching several hundred interested parties have already registered. Website and online services In October 2011 we have launched our new website. It is more accessible and offers more space for obtaining information in a simple, user-friendly and clear way. An example of this is the distinction between ‘I want to be paid’ and ‘Do I have to pay?’. Buma Songtracker During the Amsterdam Dance Event we launched the Buma Songtracker App. With this App rights owners can follow airplay of their works. The app uses the fingerprint system, that registers, 24 hours a day, which works are played on more than 40 national radio stations. With the Songtracker App we have made a start to giving rights owners more insight into the use of their works.
ANNUAL REPORT 2011
Improvement of complaints department We distribute a remuneration on approximately one and a half million works. In about 13,000 cases of the one and a half million (0.9%) we receive questions from rights owners. The processing of a complaint can be a complicated and lengthy process and is often difficult for rights owners to follow. In 2011 we therefore adjusted the processes around complaint processing. Through this we have reduced the duration of complaint processing, improved the quality of processing and made the complaints process clear. As of 1 January 2012 complaint processing comes under one department: the department Service Rights owners. This department consists of account management, members service, members administration and comments. Post-distributions To increase the flow rate of the distributions, in 2011 we started with monthly trailing distributions, in short ‘post-distributions’. The amount that could not be distributed in previous distributions, for example through lack of information, can in this way be distributed more quickly. This post-distribution process has in the meantime been completely set in motion. At the beginning of 2012, € 5 million has already been distributed in the distribution categories general rights, film and satellite. Airplay Claim To detect and identify music in commercials we use various methods, such as fingerprinting and cue sheets. In 2011 we started with the development of the Buma Airplay Claim website in order to reach an optimal level of identification.
23 All non-identified musical works in commercials are entered on this website, so that everyone can listen to them and rights owners can claim them.
Committees Arbitration Board Right holders with Buma/Stemra may invoke the dispute resolution with complaints about decisions of the board and management. A special arbitration board takes a decision. The arbitration committee has three members appointed by the Buma/Stemra General Assembly Meeting. The arbitration committee is composed of an independent chairman (a lawyer in the field of copyright), and two Buma/Stemra-right owners.
The players On the one side of the social debate is the IT and technology sector (Internet service providers and large electronics businesses), that want as much freedom as possible to disseminate content on the Internet. They are supported in this by organisations that devote themselves to spreading free speech on the Internet. Standing opposite them are authors and publishers, who wish to have a fair remuneration for the use of their works. For the authors it is not about blocking the use or the circulation of their work on the Internet, quite the contrary. However, they do have the right of a fair remuneration.
Our standpoint The dispute irresolution is open to all authors and music publishers that are a member of Buma/Stemra. Thus, the arbitration committee of Buma/Stemra is the appeal body for a right owner with a specific complaint about a decision by management and board which affected the owner individually and directly in his or her interests. The decision of the arbitration board is binding for all parties, unless the court decides otherwise in a particular case. In 2010, the arbitration committee ruled in two cases. No complaints were submitted to the arbitration committee in 2011.
The court can only take effective action if there is a statutory ban on downloading from illegal sources. With that, it has an instrument to force sites, which provide music without composers and lyricists receiving a fair remuneration for their work, to stop. Of all music that is downloaded in the Netherlands, approximately 85% still comes from illegal sources. We continue to emphasise the necessity of combatting illegal content. Together with the stimulation of business models with which regulated circulation of content on the Internet is possible. In the meantime, we have already provided 60 platforms with a licence, including big names as iTunes, Spotify and YouTube.
The policies of the Ministry of Justice CSs were at the centre of political attention in 2011. On 11 April the State Secretary sent the House his spearhead letter, containing his ambitions for this Cabinet period. Relevant points for us are: • Greater confidence in copyright and the copyright organisations, by quickly dealing with the proposed bill Supervision of CSs. Standing Committee on Plagiarism (SCP) In 2011 two cases were submitted to the Standing Committee on Plagiarism (SCP). In one case the complaint was wellfounded, and the other case was declared groundless. In 2011, on the recommendation of the members of the SCP, the board of directors decided that in future the rulings of the SCP would be published. The SCP offers a simple solution in disputes about the origin and originality of musical works. Currently the SCP consists of five musicologists and two professors.
• Strengthened contractual position of authors and performing
artists compared to operators, through a proposed bill Copyright Contracts. • Promotion and protection of new business models on the Internet, through a proposed bill to combat infringement facilitating websites and a reconsideration of the Home Copy Exception. • Support of European plans to facilitate digitising projects and the conservation of cultural heritage and driving back the territorial restrictions of copyright licences. • Realisation of the fair-use exception in the copyright guideline.
3. Copyright in the digital age
In 2012 the following issues are on the political agenda:
Introduction
• The proposed bill Supervision CSs. This proposal has already
In 2011 the already heated discussion about copyright in the digital age became even more intense. This was very noticeable in the media and in politics, as well as on the Internet itself.
received a lot of attention, partly due to the negative publicity about Buma/Stemra. Part of the House wants to go even further than the proposed bill, by imposing requirements on the incomes of management and board of directors and with Buma/Stemra
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supervision of the fees prior to publication. • The proposed bill Copyright Contracts is officially prepared
and rests with the State Council for advice. In the course of 2012 the proposal will be dealt with in the House.
Download ban or not? Many political parties expect that the use of illegal content will automatically decrease if sufficient legal content is provided. Furthermore, they regard a download ban as an unnecessary and dangerous restriction of the freedom of circulating information on the Internet. However, we ascertain that despite the large legal supply of music, use is still made of illegal providers. Competing with free of charge is not a feasible proposition. After dealing with the State Secretary’s spearhead letter it became clear that he cannot yet count on a majority for a ban on downloading from illegal sources. However, he holds on to his resolve and in 2012 he will come with a proposed bill on that point.
Home Copying Scheme There is already a Home Copying Scheme to compensate rights owners for home copying of material protected by copyright. Even though the regulation is out-of-date on many points, the agreements have not been revised since 2003. The political discussion about the future of the Home Copying Scheme is still going on. In anticipation of a final decision, the Stichting Thuiskopie (Foundation Homecopy) has decided to earmark a portion of the funds collected by the foundation. Consequently the income from the Home Copying Scheme for Stemra is halved.
4. Media In the past year we have been in the media a lot. Often in a negative way. That does not discourage us from continuing to inform the media as well and as completely as possible, also in 2012. By dwelling on all the results that we have booked, the negative and the positive, we are hoping to be able to contribute to a more comprehensive and thus a more positive image of our organisation.
expected to come with proposals, mid 2012. An important part of the directive is the regulation of the enforcement of copyright on music on the Internet. Incidentally, in 2011 the green book – with assessment and analysis – about audio visual works was already published. This will certainly have an influence on the discussion about the directive.
Abandoned works The EC has proposed a law which must make it possible to digitalise books, articles, films and audio from which it is not known who has the copyright. Organisations that want to digitalise these works may do that if, after thorough investigation, it emerges that the copyright holder cannot be traced. This law will be dealt with in the European Parliament in 2012. Home Copy levy After a long discussion about the Home Copy levy, the EC appointed a mediator in May 2011. The mediator is now striving to reach a joint agreement with the manufacturers of the carriers and the CSs. Creative Europe In 2011 the EC announced that they will establish a European fund for the creative industry. This fund will be known as Creative Europe and is part of a proposal in the long term budget for 2014-2020. It brings the current culture, media and MEDIA Mundus-programs together and underpins the cultural and creative sectors with a budget of € 1.8 billion – an increase of 37%.
5. International developments
Other international developments
European commission
Cannes-agreement On 18 November 2011 publishers and overseas sister CSs reached agreement on the Cannes-IV agreement. This agreement regulates the percentages which overseas sister CSs may deduct for Phono Mechanical Rights as a remuneration for their administrative activities and as a distribution to rights owners. The duration of the new agreement is three years, ending on 31 December 2013.
Introduction Not just in the Netherlands, but also at European level the future of copyright, the role of CSs and how they operate is being discussed. Through a directive the Brussel governance wants to organise transparency and super vision well, in all forms of collecting societies. In December 2011 there was an impact study into the consequences of possible solutions. The European Commission (EC) is
ANNUAL REPORT 2011
25 Biem/Cisac The international umbrella organisation Biem/Cisac is working hard on the Global Repertoire Database (GRD). This project’s objective is to develop a comprehensive and exclusive database for the recording, monitoring and maintenance of the copyright data of all worldwide musical works. On the initiative of EU-commissioner Neelie Kroes, CSs, publishers and music users came together to explore how a GRD for musical productions could be created and put into service. The implementation and the use of the GRD is expected to save costs and prevent duplication in data processing.
Decrease turnover Stemra Like the previous years, the turnover of Stemra has decreased by € 3.5 million (nearly 10%) to € 32.1 million (in 2010 it was € 35.7 million). The decrease is mainly in the categories Phono Mechanical Rights Biem/Central Licensing (€ 4.1 million) and Home Copy (€ 1.5 million). The first category, with a turnover of € 12.5 million (39.1%), makes the most important contribution to the turnover of Stemra. In the other categories there is a slight increase in turnover. The most important in this is Mechanical Rights Online Licensing (€ 1.3 million) and Mechanical Rights Abroad (€ 0.6 million).
Music market European Sister CSs As a result of developments in the music market, European sister CSs are increasingly looking for joint ventures with sister organisations. An example of this is ICE, the joint venture between the English organisation PRS and the Swedish organisation STIM in the area of documentation of musical works. And there is Armonia, the joint venture between sister organisations SGAE (Spain), SPA (Portugal), SIAE (Italy) and SACEM (France), designed to issue European licences for online use of local repertoire. We expect that such joint partnerships will continue to increase In the coming years.
We are in the middle of a falling music market in the Netherlands. The NVPI recently announced that in 2011 the Dutch consumer spent a total of € 180.2 million on physical music products, especially CDs. That is 10.3% less than in 2010. Spending on downloads rose to € 25 million. However, physical carriers are still the most decisive factor for the turnover. The NVPI estimates that the total turnover share of the digital market in the Netherlands – downloads and streaming – at branch level is approximately 15%. Worldwide that share is 32%. In the United States it is more than 50%. Furthermore, the NVPI announced that the total purchase of music, films, television series and games in the Netherlands in 2011 has decreased to € 875 million (1.4%).
Turnover per category
6. Financial results and market developments Turnover By turnover we mean the income from the exploitation of rights.
Radio & TV and Cable The largest category, Radio & TV Performing Rights, provided a turnover at Buma of € 51.8 million (in 2010 it was € 50.2 million) and at Stemra a turnover of € 5.3 million (in 2010 it was € 5.1 million). The total growth of € 1.8 million is from the increase in turnover of a number of television companies and a number of new contractors. The category Cable provided a turnover at Buma of € 11.9 million. This is a slight decrease compared to last year.
Reinforcement Increase turnover Buma The turnover of Buma rose in 2011 by € 2.6 million to € 142.9 million (in 2010 it was € 140.3 million). With the exception of the categories of Hospitality Industry, Workplaces and Cable all categories have contributed to the increase in turnover. Highlight is Radio & TV Performing Rights: their turnover rose by € 1.6 million. This category, with well over 36%, contributes the most to the turnover of Buma.
In order to further reinforce the protection of rights for audio visual productions, we are involved in negotiations with the association RoDAP (Vereniging Rechtenoverleg Distributie Audiovisuele Productions). Other CSs that participate in this are Agicoa, Lira, Norma, Pictoright, Sena and Vevam. The Association RoDAP is a partnership of broadcasting companies and distributors focused on the Netherlands, who are members of NLCable, plus Tele2, KPN and Glashart. RoDAP wants to make one arrangement with the CSs involved, for all forms of
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Vanderbuyst Photo Sander Baks
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recording, publication and making available by the members in the whole chain.To forestall legal procedures about the complex publication issue, they will do this with an agreement with economic basic assumptions. It concerns the linear transfer of the broadcasting stations, missed broadcasts and extra activities for a charge, such as video on demand. The intended starting date for RoDAP of 1 January 2012 has not been achieved. It involves complicated matters and complex interests – however, that does not discourage the parties from carrying on the negotiations in 2012. Live The turnover in the category Live rose slightly to € 20.4 million (in 2010 it was € 19.9 million). This increase in turnover is chiefly through the increase of the turnover in the cinema sector. In 2011 there were fewer major live performances in the Netherlands. The effects of the VAT increase and the cutbacks in the cultural sector however, were less than expected. Many productions were already booked well in advance. We expect that the effects will only be fully felt in 2012. Hospitality Industry, Workplaces and Shops and stores Due to the joint venture with Sena, through the Service Centre, we have achieved a newly generated turnover of approximately € 2 million. However, due to other factors the turnover, and the turnover of individual licences in particular, is under pressure. The turnover in the category Hospitality Industry decreased by nearly € 2 million to € 15.0 million. In the budget only a decrease of € 1 million was taken into account. The larger decrease is mainly due to the recession. Furthermore, the turnover in 2010 was a one-off high due to a settlement covering several years. The turnover at Workplaces has slightly decreased to € 17.6 million (in 2010 it was € 17.8 million). This decrease is also a result of the recession. Through the expansion of the points of sale of large chains of stores and the increase in turnover through the joint venture with Sena by the Service Centre, Shops and stores also still had a slight growth. At Shops and stores the turnover has increased to € 12.9 (in 2010 it was € 11.9 million). Online Our turnover in the online segment has risen to € 3.3 million (in 2010 it was € 1.3 million). This growth was largely due to Stemra regaining the mandate for the licensing of the Anglo-American repertoire for online. Furthermore, in 2011 we have approached the newly started music services very
ANNUAL REPORT 2011
actively. The volume of the online turnover is still limited, so this might still fluctuate in the coming years through non-recurring items.
Performing Rights Online Licensing Through regaining the mandate for the Anglo-American repertoire we are again able to license the entire world repertoire locally and we can serve the market better. The increase in turnover from downloads is partly due to the role that Buma has managed to acquire as music broker for the rights of Sony Music for their European download campaign. Via a pan-European licence we have been able to arrange these rights for Sony Music. Thereby doubling the turnover to € 1.5 million (in 2010 it was € 0.8 million).
Mechanical Online Licensing The turnover in the category Mechanical Rights Online Licensing tripled to € 1.8 million (in 2010 it was € 0.5 million). This is due to Stemra regaining the mandate for the licensing of the Anglo-American repertoire for online.
Licences with online services To anticipate the speedy emergence of streaming and download services, we have developed licence types that are geared to these forms of music distribution and sales. In the meantime licences have been arranged with a few dozen music platforms. Thereby we have laid the foundation for the online future in our licensing models.
Podcast discussion The discussion about the rates for podcasts attracted a lot of media attention. After the introduction of new rates a major provider of podcasts was unhappy about the level of the rates and the fact that it was put into operation retroactively. The provider subsequently decided to remove all its podcasts from the site. After positive consultations it was agreed to move the introduction of the new rates to the beginning of 2012. The agreement commenced 1 January.
29 Development podcast rates At the introduction of the podcast rates the rates were fixed at € 240 per podcast per year, irrespective of the number of times that it was downloaded. This rate was relatively low, so that the podcast had the possibility to develop as a medium. It is now clear this was successful. Through the enormous success the experimental rate is no longer realistic. Millions of podcasts are downloaded each year, in which the provider gives away hours of music without a fair remuneration going to the authors of the music.
Flexco At the annual meeting in May 2011 the proposals for a more flexible regulation of the online rights of members was also discussed. The proposal for the flexible online rights administration, the so-called Flexco-proposal, did obtain a majority, but not the requisite two third majority which is necessary in order to be able to change the statutes and thereby make flexible rights administration possible. Abroad The turnover of Performing Rights Abroad rose to € 11.9 million (in 2010 it was € 10.5 million). The work of Dutch DJs, jingle & tune makers, music in commercials and various hits with the involvement of Dutch composers accounted for this increase. The turnover of Mechanical Rights Abroad grew to € 4.4 million (in 2010 it was € 3.8 million). This growth is mainly due to higher income from France and Great Britain. Phono Mechanical Rights Biem, Central Licensing and Special Licensing/Private Labels In the largest turnover category of Stemra – Phono Mechanical Rights Biem and Central Licensing – the turnover decreased significantly by € 4.1 million. This is a decrease of nearly 25%. This is through the continuing decrease of the sale of physical carriers. The turnover of Special Licensing/ Private Labels remained approximately the same as last year (€ 6.3 million).
Home Copy and Lending Rights The turnover Home Copy/Lending Rights has decreased to € 1.7 million (in 2010 it was € 3.2 million). This is through a decrease of the income from the Home Copying Scheme, which has more than halved: from € 2.9 million in 2010 to € 1.3 million in 2011. The cause of this is the political discussion about the future of this scheme. Pending a final decision, the Foundation Home Copy has decided to earmark a portion of the funds collected by the Foundation and thus this lowering the distributions. Musi©opy After approval from the General Members Meeting in May we took over the duties of Musi©opy. It has served the interests of music publishers and authors in the area of the so-called secondary use since 1995. Think of copyright aspects of song texts and musical notations and the licensing of the re-use of these works. Musi©opy had too little income and an unacceptably high cost percentage. Thereby they could not continue to exist as an independent professional organi sation. We have systems at our disposal by which the administration can be done more efficient. Furthermore, we have good contacts with groups of music users that were difficult for Musi©opy to reach. With these activities we can offer an extra service and better financial coverage. For Stemra, 2011 was the first year in which they did the exploitation of graphic reproduction rights. Through a delay in the signing of the exploitation contracts, a start could only be made with these activities in April 2011. This had the necessary impact on the turnover development. In 2012 we expect to catch up on this.
Impala/Stemra creates European Portal for offline Mechanical Rights Impala is a branch organisation for independent Music producers in Europe. In 2011 Impala andStemra reached an agreement to develop a Portal together for offline rights. The aim of the Portal is to simplify the licensing of offline Mechanical rights for the members of Impala.
Distribution Our main task is – on behalf of rights owners and affiliates – the exploiting of their Performing Rights and Phono Mechanical Rights and distributing to them what they are entitled to. The realized turnover in a year differs from what we distribute to rights owners in that same reporting year. Therefore there is a great difference, in the financial accounting, between the turnover in royalties that we have realized in the reporting
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year (and the amount reported in the financial statements) and the amount which is distributed in the reporting year to the rights owners. The distribution is namely the result of the exploitation turnover which was realized in previous years.
Social Fund Buma, the surcharge Serious and the surcharge Online and the Pension Scheme for authors and publishers. The allocations are set out in more detail in the notes to the financial statement. In this section we go into the activities of the Foundation Buma Cultuur.
Buma Cultuur
Distribution Buma In 2011 Buma distributed € 114.1 million to members, participants and foreign organisations (in 2010 it was € 114.0 million). Furthermore, € 9.6 was added to the Fund for cultural and social purposes. In total this is a distribution of € 125.5 million (in 2010 it was € 126.4 million). The decrease is mainly due to lower allocations to the Funds for cultural and social purposes of 8.5% in 2010 to 8% in 2011. The effect of the increased turnover of Buma on the distribution is only noticeable in 2012. In just the first couple of months of 2012 in the post-distributions general rights, film and satellite € 5 million more was distributed than in the same period in 2011. Also the distribution Abroad in 2012 is nearly € 2.5 million higher than in 2011. These funds are accounted for in the royalties to be distributed at the end of 2011.
Distribution Stemra Stemra distributed € 29.1 million in 2011 to members, participants and foreign organisations (in 2010 it was € 33.7 million). This decrease is due to the drop of the turnover as a result of the continuing decrease of the sale of physical music carriers and the political discussion about the Home Copying Scheme. Furthermore, partly through the absence of a ban on downloading from illegal sources, the online turnover lags behind. The amount of royalties to be distributed is in line with 2010.
Fund social and cultural purposes Introduction Before Buma distributes the funds received and after processing of the profits and losses, a portion is allocated to the fund for Social and Cultural purposes, the SoCu Fund. The allocation for 2011 is fixed at 8% (in 2010 it was 8.5%) of the amount available for distribution to royalties in the Netherlands. The allocation is € 9.6 million (in 2010 it was € 10.2 million). The most important use of this fund is the subsidy to the Foundation Buma Cultuur and the Foundation
ANNUAL REPORT 2011
Growth of events For Buma Cultuur 2011 was dominated by growth. Not of ourselves, but of the events which we organize. One of our most important objectives from the policy plan 2009-2012 is that at the end of 2012 the Dutch consumer must be able to establish a link between the promotion of Dutch copyright and Buma (Cultuur). The focus in 2011 was therefore chiefly on production. The number of events had to noticeably increase. Through starting up new events and dealing even more professionally with existing events, virtually nobody could ignore us anymore. With as a result: the growth of all the events of Buma Cultuur and of all the events in which Buma Cultuur was involved. At all of these events the emphasis was entirely on our main task: the promotion of Dutch copyright. A lot of media attention Practically every month Buma Cultuur was active somewhere in the Netherlands and we received attention from national media. In 2011 we organized four musician days: in Nijmegen, Zwolle, Eindhoven and Utrecht. Also our contribution to the sold out Eurosonic Noorderslag in January 2011 generated a lot of attention. On the stage of Eurosonic and Noorderslag, well over 100 Dutch bands got a place– the Netherlands was in 2011 namely the focus country. Buma Rotterdam Beats on 17, 18 and 19 November 2011, was organised for the second time. And here too the event gained a foothold on Rotterdam ground. With 600 visitors and big international seminar participants, the event took a considerable step forward. Worldwide trend-setting dance industry conference The Amsterdam Dance Event, initiated by us, was once more a success in 2011 and is becoming the most important dance industry conference in the world. The event was sold out weeks in advance and attracted in addition to 3,000 professionals also well over 130,000 festival visitors.
Our other events The second edition of Buma NL had no shortage of interest. For this a substantial investment was made. Results were a TV broadcast on Nederland 1, a doubling of the number of visitors, wide media attention and a growing relevance
31 for professionals. This year we awarded the Gouden and Zilveren Harpen for the 49th time during the Buma Harpen Gala 2011, once again broadcast live on Netherlands 3. Winners of the Buma Gouden Harpen 2011 were: Nick & Simon, Tony Berk, VanVelzen and Kane. The Buma Zilveren Harpen went to Caro Emerald, Frans Duits and Sander van Doorn. In addition Caro Emerald won the prize for the Best Dutch song 2010 with ‘A Night Like This’. The Buma Export Prijs 2011 went once again to André Rieu. Moving the programming of the Holland Festival was a good decision for Toonzetters. As the event was limited to one evening – the production was slightly cheaper, the media attention was greater and the house was, for the first time, virtually full.The Jazz day has come through the move to Rotterdam well. More and younger public, higher ratings and higher income. The joint ventures with North Sea Jazz also bore fruit. Professionals who were present could not ignore the Dutch talent. New: Buma Music in Motion A new event in 2011 was Buma Music in Motion. The attendance was reasonable, but it could be better. The event is designed to gain more attention within the multimedia genre for film music, for music in games and RTV music. With this, the first step has been taken towards a solid event within the multimedia music.
Profit and loss account Buma The operating result of Buma amounts to € 16.9 million negative (in 2010 it was € 13.5 million negative). This decrease in the operating result by € 3.4 million is in particular the result of an adjustment in the allocation system of the costs between Buma and Stemra. From 2011 the joint costs of Buma and Stemra are shared on the basis of 75% and 25% respectively. Costs which are directly allocable to a specific organisation are for 100% accounted for in that entity. In 2010 individual percentages per cost category were still employed, whereby Stemra on average was more heavily burdened. Adjustment of the distribution of costs has led to a lower charge compared to 2010 of approximately € 2.6 million.
• expanded activities of Service Centre. This leads to higher costs
service bureaus of € 0.8 million and a reduction of personnel expenses of Buma of € 0.3 million because the Service Centre has taken over part of the Buma-personnel; • higher personnel expenses of € 0.4 million through indexation of the salaries and a few non-recurring items; • higher consultancy fees of € 0.5 million through requisite hiring of external lawyers and the renegotiation of the lease agreement; • a decrease of the outsourcings costs by € 0.7 million through transferring the outsourced back office activities from Prague to India. In 2011 a result of € 9.1 million was withdrawn from the royalties to be distributed (in 2010 it was € 8.3 million). In the withdrawal from the royalties to be distributed 2010 the last part of the negative course result of € 3.3 million was also processed. Stemra The result of € 0.1 million in 2011 has been added to the royalties to be distributed. Compared with 2010, when there was a withdrawal from the royalties to be distributed of € 1.0 million, that is an improvement of € 1.1 million. In 2011 the operating loss of Stemra was € 1.9 million (in 2010 it was € 4.5 million). This is an improvement of the operating result of € 2.6 million compared to 2010. This improvement of the operating result is largely attributed to the new allocation system of costs between Buma and Stemra. Other fluctuations in costs, as a result of the recharge by Buma, are in line with developments at Buma. The withdrawal of 2010 also contains the remaining part of the investment loss of 2008 of € 1.3 million.
Investments
Increased costs
Introduction Just as every year our profit and loss account is strongly influenced by the financial result. This figure represents the revenue from investments.
The total operating costs for Buma in the financial year 2011 amounted to € 20.1 million (in 2010 it was € 16.9 million). In addition to the above mentioned adjustment of the allocation system of the Buma and Stemra costs, the increase of the costs by 19% is chiefly caused by:
In the nineties, the board of directors decided to invest available funds under conditions. Funds from the exploitation of rights cannot immediately be distributed to rights
Decision to invest
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owners. A lot of time is needed to gather all the data and to reach a correct distribution. This does not just involve the data of rights owners and affiliates, but also that of the users of our rights. Before we are certain about the exact use of musical works by licensees, we are often months further. Especially if it involves users from abroad. In the nineties it became clear that it was more prudent – under conditions – to invest received funds that were waiting for distribution, rather than paying them into a mediocre yield deposit account. That applied then. And still does. We have drawn up an investment policy for this, whereby risks are limited as much as possible. As much as possible, because investing is never without risk.
following ALM-norm was established: 65% fixed interest securities and 35% marketable securities.
Investment committee Buma/Stemra has an investment committee to draw up an investment plan, select asset managers and monitor and assess the investment results. A range for the strategic management scope, based on the ALM-norm, has been determined by the management boards. The investment committee is authorized to take decisions within these SAA-ranges. The allocations are laid down in an investment plan that is drawn up annually.
Constitution of the committee Valuation of investments Shares and bonds are valued on the balance sheet against the market value on the balance sheet date. The results arising from this are processed in the revaluation reserve. As far as the balance of the revaluation reserve allows, as well as the received dividend on shares and (since 2006) as well as the interest received on the fixed rate portfolio, a so-called standard return can also be entered in the financial result. This methodology fits in with our objective that over the years, the sound investment results on shares and fixed interest securities show as constant as possible course in the profit and loss account. The result of the investments is entered in the profit and loss account of Buma and Stemra under the heading financial result. Investment policy The funds that are available for investment are placed with the Foundation Buma Stemra Equity (BSA) and the Foundation Buma Stemra Bond Funds (BSO). The Boards of Buma and Stemra together form the constituted Board. The constituted Board based its investment policy on an Asset Liability Management comparative study (hereafter ALM). Hereby, the investment policy is determined by means of an assessment of the interdependence of the rights and commitments of the organistion.
Two sides The objective of the investment policy has two sides. One side is, to retain the value of the collected licensing income until the moment of distribution. The portfolio for this must be sufficiently liquid and be conservatively invested. On the other side is the striving for an investment revenue which – at least for a part – covers the operational costs of the association. For this the portfolio must also generate sufficient return and make effective use of a previously determined risk budget. On the basis of this objective the
ANNUAL REPORT 2011
The members of the investment committee are appointed by the management boards. The investment committee elects a chairman and a secretary who form the executive board. As part of the investment committee, the executive board is responsible for the operational implementation, steering of administrators and advisers and the instructions for transactions. The executive board is assisted by a fiduciary advisor and periodically reports to the investment committee about the results and transactions of BSO and BSA.
Law supervision CSs The Proposed Bill Supervision Collecting Societies Copyright and Neighbouring Rights will, in all probability, immensely limit our possibilities to invest. The plenary discussion of the proposed bill was on 14 February 2012. It is clear that our – previously approved by the College of Supervision– prudent investment policy has benefited the rights owners. Over the past twelve years that yielded cumulatively nearly € 42 million more than if it had not been invested. Thanks to those investment results the actual cost deductions in those years continued to be limited to a few per cent of the annual amount distributed to rights owners. The proposed statutory restrictions of the investment possibilities, such as expressed in the new Law Supervision, can push down the income of music authors the coming years by 5% to 10%. The future investment possibilities have not yet been drawn up. It is clear that a transition period will be
33 needed. In the investment plan 2012 we are, for the first time, going to anticipate the expected curtailment.
Financial result Buma The financial result of Buma decreased in 2011 by € 0.7 million to € 7.8 million This decrease of 8% of the financial result is mainly due to the economic recession and the turmoil in the financial markets.The decrease of the financial result was tempered by Stemra’s current account ratio with Buma being redeemed at the end of 2010 and through there being another distribution of the financial result BSO/BSA between Buma and Stemra. In 2011 we used the percentages 79.9%/21.1% for the distribution (in 2010 it was 63.5%/36.5%). This difference of 16.4% – for Buma an increase – is the result of the sale of participations by Stemra to the value of € 69.5 million:
7. A look ahead to 2012 Turnover and result In the notes on the financial statements we have entered the budgets for 2012. Based on the current market conditions we expect a slight increase in turnover for Buma. At Stemra, however, we see a further decrease as inevitable.
• redemption of loan in current account of Buma to Stemra
Increase in turnover at Buma
of € 55.7 million, • redemption of loan in current account with BSO and BSA of € 13.3 million, • expansion of liquid assets of Stemra of € 0.5 million.
The increase of the budgeted turnover at Buma with € 3.1 million compared to the realization 2011 comes mostly from the categories Cable, Hospitality Industry and Shops and stores. At Hospitality Industry and Shops and stores an increase in the budget is factored in. The current signals from the market however, suggest that here a downward adjustment must take place, in spite of intensive marketing deployed by the Service Centre. In 2012 we expect a negative result for Buma from the exploitation result exclusive normative yield of € 11.4 million (in 2011 it was € 11.1 million). This budgeted deterioration is due to a lower expected income from interest and dividends (minus € 0.4 million).
The interest received on bonds rose in 2011 by € 1.0 million. The received dividend decreased by contrast by € 0.2 million. On balance this led to an increase of € 0.8 million. In total there is a decrease of € 1.0 million. This is the result of the decrease of the standard return through the low interest rate at the end of 2011 and the decrease of other financial profits and losses by € 0.5 million.
Financial result Stemra The financial result of Stemra decreased in 2011 to € 2.0 million. This decrease of 58% is partly due to the economic recession, but is reinforced by the adjustment in the distribution of the financial result BSO/BSA between Buma and Stemra. This adjusted distribution has had a lot of impact on the standard return, that decreased by € 1.2 million. The received interest and dividends decreased by respectively € 0.2 million and € 1.2 million.
Balance sheets For comprehensive notes on the balance sheets of Buma and Stemra we refer you to the financial statements of 2011 which you can find further on. The most important fluctuations from the financial year 2011 are explained in the notes on the balance sheets.
Decrease turnover Stemra The decrease of the budgeted turnover at Stemra with € 4.6 million is mainly from the category Phono Mechanical Rights Biem/Central Licensing. This is in line with the trend of the past years. Furthermore, we expect that the turnover Home Copy will almost completely disappear as a result of political discussion. In 2012 we expect a negative result for Stemra from the exploitation result exclusive standard return of € 1.1 million (in 2011 it was a negative result of € 0.5 million). This budgeted decrease is on the one hand caused by the expected drop in revenue as a result of an expected lower administration costs deduction and on the other hand an expected decrease of interest and dividends and an increase in the costs.
Future Stemra Stemra has suffered from loss for some time. And that means that measures are necessary. Stopping with the exploitation of Mechanical Rights would be the most drastic measure.
Buma/Stemra
directors’ report
There are also other solutions. Thus, in 2011 joint ventures with large European sister CSs abroad were intensively examined. Sharing one back office together for administrative processes such as invoicing and the processing and matching of user data, would enable more efficient work. In 2012 we will take concrete decisions about this.
of making sure that all rights owners and affiliates receive the distribution destined for them. And we thank our co-workers, who have fully dedicated themselves in 2011 to music authors, music publishers and music users. We hope that in 2012 we can once more clearly show politics, society and the music world that Buma/Stemra is there for all rights owners and affiliates.
Unclear legislation In 2011 we had expected that the State Secretary would provide clarity about the regulations about supervision of CSs. This clarity has unfortunately failed to materialize. We assume that in 2012 there will be more clarity about the way in which the State Secretary will formulate his proposed bill about the supervision of collecting societies. Also the copyright contract is still on the agenda.
Fair chance The outcome of this new legislation is decisive for the continuation of Stemra. A download ban, in combination with a vigorous enforcement policy, gives the legal music carrier a fairer chance. That also means higher sales and with that higher turnovers for Stemra.Though it does not alter the fact that we are looking at international joint ventures in order to better be able to carry Mechanical Rights. Other European sister CSs are also looking at this. They likewise are faced with complex administrative reforms which they must implement to achieve good processing. Platforms such as iTunes, Spotify and YouTube monthly supply enormous amounts of user data. This must all be processed by an administrative system. Together with sister CSs abroad it can take place much more efficiently.
8. Conclusion We have received a lot of negative criticism in 2011. We have learnt from it. Also in 2012 we will show that we are an organistion that can and wĂll listen. An organistion which does everything it can to be transparent. Which will show that we are in earnest– for example, by starting intensive innovations. An organisation where, each day anew, nearly 200 co-workers do their utmost to provide the best possible service. We thank everyone who enables us to do our work
ANNUAL REPORT 2011
Hein van der Ree Executive chairman Hoofddorp, 4 April 2012
35
Buma/Stemra
De Jeugd van Tegenwoordig Photo Mike Breeuwer
Buma Financial statements 2011
Buma balance sheet
Buma balance sheet as at 31 December 2011 After appropriation of the result (x â‚Ź 1,000)
31 December 2011
31 December 2010 *
Assets Fixed assets Intangible fixed assets (1) Tangible fixed assets (2) Financial fixed assets (3)
-
-
501
504
207,262
202,846 207,763
203,350
Current assets Accounts receivable (4) Other receivables (5)
11,830
8,151
2,732
2,619
431
343
Prepayments (6)
10,697
12,261
Cash and cash equivalents (7)
28,582
Taxes and social security contributions
35,857 54,272
59,231
262,035
262,581
Liabilities Reserves Continuity reserve (8) Appropriated reserve (9) Revaluation reserve for financial fixed assets (10)
1,855
1,855
-
-
6,154
10,796 8,009
12,651
9,531
11,174
15,023
17,168
Provisions Provisions (11) Long term liabilities Fund for cultural and social purposes (12) Current liabilities Royalties to be distributed (13) Accounts payable Other liabilities (14) Taxes and social security contributions Other payables and deferred income (15)
* Adjusted for comparison purposes
ANNUAL REPORT 2011
170,504
162,211
4,519
2,948
47,612
49,173
325
405
6,512
6,851 229,472
221,588
262,035
262,581
39
Buma profit and loss account
Buma profit and loss account for the year ended 31 December 2011 (x â‚Ź 1,000)
2011
2010
Income 1,838
2,151
Entrance fees and annual allowances
617
604
Other income
696
602
Administrative costs
3,151
3,357
Expenses Personnel expenses (17) Office and accommodation costs Depreciation and amortisation Other expenses (18)
10,085
8,151
1,438
1,141
368
580
8,169
7,047 20,060
16,919
-16,909
-13,562
7,817
8,496
-9,092
-5,066
Exceptional income
-
512
Exceptional expenses
-
-512
-9,092
-5,066
Operating result
Financial result (20)
Result from ordinary activities
Result Result appropriation Result allocated to appropriated reserve Result deducted from royalties to be distributed
-
3,253
-9,092
-8,319
Buma/Stemra
Buma cash flow statement
Buma cash flow statement for the year ended 31 December 2011 (x € 1,000)
2011
2010 *
Cash flow from turnover and distribution (13) Turnover Distribution
142,948
140,346
-125,563
-126,352 17,385
13,994
Cash flow from funds Deductions in favour of funds (13) Payments from funds (12)
9,581
10,212
-11,726
-10,601 -2,145
-389
Cash flow from operating activities Administrative costs charged (13)
1,838
2,151
Other income
1,312
1,206
Interest and dividends
5,384
5,264
8,534
8,621
-20,060
-16,919
Total expenses Correction for depreciation and amortisation
Changes in continuity reserve
368
581
-19,692
-16,338
-
-512
Changes in provisions (11)
-1,643
-1,101
Changes in other receivables
-1,897
43,312¹
Changes in other liabilities
-409
1,460
-3,949
43,159 -15,107
35,442
Cash flow from direct investment activities Investments in tangible fixed assets
-365
-240 -365
-240
Cash flow from indirect investment activities Purchase of securities Repayments/sales proceeds
-123,727
-84,670¹
116,684
45,511
Net Cash flow Cash and cash equivalents as per 1 January
35,857
Cash and cash equivalents as per 31 December
28,582
Changes in cash and cash equivalents
-7,043
-39,159
-7,275
9,648 26,209 35,857
-7,275
9,648
¹ This concerns the repayment of the loan in current account of Buma to Stemra and investments BSO/BSA at the end of 2010. For more information we refer to the notes of the financial statements 2010.
* Adjusted for comparison purposes
ANNUAL REPORT 2011
Notes to the Buma balance sheet and profit and loss account GENERAL Buma Association’s objectives Vereniging Buma (Buma Association) its registered office is in Amstelveen. The Association aims to promote both the material and immaterial interests of authors and music publishers, with its ensuing activities taking place on a non-profit basis. Vereniging Buma is designated by law to represent the aforementioned right owners.
Principles for the valuation of assets and liabilities and determination of the result The principles adopted for the valuation of assets and liabilities and determination of the result are based on historical costs unless otherwise explained. If not stated otherwise, assets and liabilities are stated at face value. Income and expenses are allocated to the period to which they apply. The Voi©e certification criteria were taken into account in preparing the financial statement. As a result of these criteria for Collective Right Managements Organisations additional information was added and the annual returns of 2010 were reclassified for comparison (to the figures of 2011).
Accounting principles for the translation of foreign currency Transactions denominated in foreign currency are translated to euros at the applicable exchange rate on the transaction date. Monetary assets and liabilities denominated in foreign currency are translated to euros at the exchange rate applicable on balance sheet date. Exchange rate differences are taken to the profit and loss account. Non-monetary assets and liabilities denominated in foreign currency that are valued on the basis of historical costs are translated at the applicable exchange rate on the transaction date.
Principles of consolidation In view of their transparent structure, Stichting Buma/ Stemra Obligatiefonds and Stichting Buma/Stemra Aandelenfonds are included in the Buma financial statements by means of proportional consolidation. Assets and liabilities, as well as income and expenses, are included in proportion to the participating interest. On the basis of the information provided in the notes, no separate financial statements for Vereniging Buma are included.
41
Change in accounting system Until 2011, the valuation of the provision SFB annual allowance scheme was based on non-actuarial principles. In 2011, the valuation is adjusted and determination of the provision SFB annual allowance is based on actuarial principles. This change has been made in order to reflect to current developments in the field of financial reporting. As a result of the change € 206,000 of this flowed back to the Fund for social and cultural purposes. The change has no effect on the result and financial position of Buma. Given the limited impact of the change, the comparative figures on the balance sheet and profit and loss account of the previous year are not adapted to the new system.
Deviations from BW2 Title 9 The important deviations from BW2 Title 9 - The Civil Code for the valuation of assets and liabilities and determination of results are: Application of the standard return on investments Price gains/losses arising from the valuation of securities at market value are not directly taken to the trading account, but are first included in the revaluation reserve for financial fixed assets (hereinafter: ‘revaluation reserve’). If the position of the revaluation reserve is sufficient at the end of the year, a so-called standard return can be recognised in the financial results. According to the Guidelines for Annual Reporting (Richtlijnen voor de Jaarverslaggeving) the abovementioned trading results should be recognised directly in the profit and loss account. Buma Stemra applies the methodology to account for a consistent development of the financial results in the profit and loss account and to align the financial result with the long-term objective of the investment strategy. Consolidation of Buma Cultuur Among the legal requirements and with the current design of the governance structure of foundation Buma Culture (hereafter Buma Cultuur) it is possible that Buma Cultuur (including foundations Amsterdam Dance Event and Buma Rotterdam Beats) can be seen as part of the consolidation scope of Buma. This would mean that the figures of Buma Cultuur should be integrally consolidated in the financial statements of Buma. In the current situation consolidation is not applied, but Buma Cultuur is treated as a related party whereby transactions with Buma, and more specifically with the fund for cultural and social purposes, are explained. Buma considers that, given the very different activities, consolidation of Buma Cultuur in the financial statements
Buma/Stemra
Notes to the Buma balance sheet and profit and loss account
does not benefit the legally required insight into the accounts of Buma as a collective right management organisation.
Intangible fixed assets The intangible assets concern the expenses for the new business information system to support the primary business processes. These are valued at historical cost less cumulative investment expenses or amortisation. These investments are charged to the profit and loss account over a period of three years.
Tangible fixed assets The valuation of tangible fixed assets takes place on the basis of historical cost less cumulative depreciation. Depreciation is calculated as a percentage of the purchase price according to the straight-line method on the basis of the expected useful life.
period to which it relates. Insofar as the balance of the revaluation reserve, less a possible appropriate reserve for (un)realised gains or losses arising from changes in market prices, leaves room for this, a ‘standard return’ is included in the financial result, in addition to any receivable share dividend and interest on bond funds. In the calculation of the standard return, the dividend and interest already paid out are taken into account, and only the difference between the dividend/interest received and the standard return is settled with the revaluation reserve. The standard return is calculated as a percentage of the average value of the shares and bond funds over the financial year, and comprises the effective return on 5-year euro government bonds at the end of the financial year plus a risk mark-up for shares. The difference between the standard return and the dividend received on shares or interest received on bond funds is withdrawn from the revaluation reserve, if possible.
The following expected useful life terms are used:
Continuity reserve
• Hardware/Computer equipment 3 years
The continuity reserve’s aims include guaranteeing the continuity of the work. It also serves to fulfil obligations in respect of third parties, in particular with regard to distri bution of the royalties yet to be distributed in accordance with the financial statements. This reserve furthermore serves to level out unwanted fluctuations in the amounts available for distribution, resulting, among other things, from domestic and international pressure on turnover, as well as continuing changes in the distribution of rights.
• Other operating assets
3 - 7 years
Accounts receivable Accounts receivable are stated at nominal value less a provision for bad debts.
Financial fixed assets The securities included under financial fixed assets are listed shares, bond funds, and (convertible) bonds. Securities are stated at market value as at balance sheet date.
Revaluation reserve for financial fixed assets Price gains/losses arising from the valuation of securities at market price are not directly taken to the trading account, but are first included in the revaluation reserve for financial fixed assets (hereinafter: ‘revaluation reserve’). To the extent that the revaluation reserve is insufficient, the deficit is charged to the result.
Appropriated reserves Appropriated reserves are the parts of reserves that management has set aside for a special purpose. In this case, it concerns the appropriated reserve for (un)realised gains/losses arising from changes in market prices. For more detailed information on this appropriated reserve, please refer to the notes to the balance sheet.
Provisions Provisions are measured at either the nominal value of the estimated expenditure required to settle liabilities and losses, or the present value of that expenditure.
Each year, the size of the revaluation reserve needed to absorb price fluctuations is determined by the Board in consultation with its asset managers. If the revaluation reserve is larger than deemed necessary, this surplus is eligible for addition to the royalties to be distributed.
• a legal or constructive obligation as a result of a past event,
Financial result and standard return
• of which a reliable estimate can be made, and
Dividends are accounted for in the period in which they are made payable; interest income is accounted for in the
• it is probable a cash outflow is necessary to settle the obligation.
A provision is mentioned in the balance sheet when there is: and
ANNUAL REPORT 2011
43 The long-service awards provision is a provision for future long-service awards. The provision is the present value of future benefits to be paid for long-service awards. The calculation is based on commitments made, likelihood to stay and age.
to the certified criteria. In addition, a longer reservation period is used for amounts that Buma has received from sister organisations but for which no information is available to do a proper distribution and with regard to monies set aside for claims in the past.
Fund for cultural and social purposes
Determination of the result
For the benefit of this fund, in accordance with Article 29 note 3 of the Articles of Association, each year a percentage defined by the Board on the recommendation of the board of directors, with a maximum of 10%, is deducted from the Dutch royalties available for distribution.
Income and expenses are accounted for in the year to which they apply. The result is determined by calculating the difference between the balance of realised income and expenditure and the financial result for the year. The balance of the profit and loss account is allocated/deducted from the royalties to be distributed and/or the reserves by means of profit appropriation.
The amounts deducted are reserved by the board for payments to institutions or organisations whose purpose is to represent the idealistic or material interests of composers, lyricists and music publishers, or who otherwise promote Dutch music. The fund for cultural and social purposes is classified as liability, because the fund is never available to the organisation.
Reservations royalties to be distributed In the process of distribution three types of reservations are made. First of all reservations are created for the event that insufficient information is available in order to distribute. For example, the lack of data of the right owners, copyright information and the missing of so-called cuesheets for movies, shows or commercials. Secondly, reservations are made for works which the cumulative earnings per work have not yet achieved the lower limit for distribution. These funds are segregated until this information is available or the lower limit has been reached and the money can be distributed in the post-distribution. Finally, a reservation is made ​​for complaints relating to the distribution, this in order to the indemnification that Buma provides to the users of music. This reservation is determined by a percentage of the funds per distribution based on the historical course of the amount paid on complaints per distribution category. The percentage of reservation for these complaints is usually between 0 and 2%. In addition, works for which there is a so-called double claims (two owners claim the same work) are reserved until this situation is resolved mutually. These amounts are also recognised in amount of royalties to be distributed. Except the so-called double claims, all reservations are released after a maximum of 3 years. This in accordance
Pension plans Buma has made a pension scheme arrangement for its employees where pension benefits are based on average salary. The plan is administered by the Foundation Sector pension fund for the media PNO. The premiums due for the financial year are recognised as expenses. Premiums that are not paid at balance sheet date are recognised as a liability. Since these liabilities have a short term nature, they are stated at their nominal value. The risks of salary developments, price indexation, investment returns on the fund assets might possible lead to future changes in annual contributions to the pension fund. These risks are not reflected in a balance sheet provision. In the event of a shortfall in the sector pension fund, Buma has no obligation to pay additional contributions other than higher future premiums. The coverage ratio of the Foundation Sector pension fund for the media PNO for the end of December 2011 amounted to 90.7%.
Turnover In the financial statements, the turnover in royalties is added to the royalties to be distributed and presented in the cashflow statement. Buma includes the exploitation of performing rights in turnover, insofar as these relate to the financial year, can be determined in a reliable manner, and there is reasonable certainty that the revenue is collectible.
Tax With regard to Buma, the Dutch tax authorities stipulated in an agreement dated 6 November 2001, determining the legal relationship between the parties, that Vereniging Buma is liable to pay corporation tax. This agreement was extended at the end of 2008 for a period of three years, and is valid until 31 December 2011. Foreign withholding tax
Buma/Stemra
Notes to the Buma balance sheet and profit and loss account
available for set-off and Dutch dividend tax may be deducted from the tax due by virtue of this agreement determining the legal relationship between parties. A tax item is only included in the financial statements if corporation tax is still owed after deduction of the foreign withholding tax available for set-off.
Accounting principles for cash flow statement The cash flow statement is drawn up using the indirect method. Exchange rate differences, like all other movements, are eliminated for so far they had not let to a cash flow. The term cash and cash equivalents is used in the balance sheet in the same way as in the cash flow statement.
Use of estimates Drawing up the financial statements requires management to form opinions and make estimates and assumptions that influence the application of principles and the reported value of assets and liabilities, and of income and expenses. The estimates and the associated assumptions are based on past experience and various other factors that are considered reasonable in view of the circumstances. The outcome forms the basis for the opinion on the carrying value of assets and liabilities that does not emerge clearly from other sources. The actual results may differ from these estimates.
ANNUAL REPORT 2011
45
Notes to the Buma balance sheet as per 31 December 2011 (1) Intangible fixed assets The changes in the intangible fixed assets can be specified as follows (x â‚Ź 1,000)
Business information system 6,958
Actual cost as at 1 January 2011
-6,958
Accumulated amortisation
-
Carrying amount Changes in carrying amount: Investments
-
Amortisation
6,958
Actual costs as at 31 December 2011
-6,958
Accumulated amortisation Carrying amount
-
Amortisation in number of years on average:
3
(2) Tangible fixed assets The changes in the tangible fixed assets can be specified as follows: (x â‚Ź 1,000)
Hardware/
Other opera-
Computer-
ting assets
Total
equipment
Actual costs as at 1 January 2011 Accumulated depreciation Carrying amount
3,292
5,296
8,588
-2,878
-5,206
-8,084
414
90
504
285
80
365
Changes in carrying amount: Investments Disposals Depreciation Depreciation impairment
Actual cost as at 31 December 2011 Accumulated depreciation Carrying amount Depreciation in number of years on average
-73
-
-73
-331
-37
-368
73
-
73
-46
43
-3
3,504
5,376
8,880
-3,136
-5,243
-8,379
368
133
501
3
7
Buma/Stemra
Notes to the Buma balance sheet as per 31 December 2011
(3) Financial fixed assets The fair value of the portfolio at the end of 2011 is € 207,3 million and it can be specified as follows:
2011 Fixed income securities Equity funds
2010
160,867
78%
160,494
79%
46,395
22%
42,353
21%
207,262
100%
202,847
100%
Fixed
Equity
Total
income
funds
The movements of the individual items can be displayed as follows (x € 1.000):
securities
Balance as at 1 Januari 2011 Acquisitions Repayments / Sales proceeds Price movements Balance as per 31 December
Securities and bonds of Vereniging Buma are valued at market value. Valuation differences on bonds and shares are charged or credited to the revaluation reserve for financial fixed assets. Buma’s securities and bonds have been placed in Stichting Buma/Stemra Obligatiefonds and Stichting Buma/Stemra Aandelenfonds. The foundations are proportionally consoli dated in financial statements of Buma and Stemra at an
ANNUAL REPORT 2011
160,494
42,353
202,847
116,288
7,438
123,726
-116,513
-170
-116,683
598
-3,226
-2,628
160,867
46,395
207,262
average percentage of respectively 79.9% and 20.1% (2010: 79.9% en 20.1%).The above mentioned amounts are the proportional share of the total amount as shown in the fully-combined balance sheet of Stichting Buma/ Stemra Obligatiefonds (BSO) and Stichting Buma/Stemra Aandelenfonds. The main movements in the fixed income securities concern in particular the conversion of (government) bond funds to bonds in order to minimise the risks in the Eurozone countries.
47 The fully-combined balance sheet of Stichting Buma/Stemra Obligatiefonds (BSO) and Stichting Buma/Stemra Aandelenfonds (BSA) can be represented in condensed form as follows: (x € 1,000)
31 December 2011
31 December 2010
Assets Fixed assets Financial fixed assets
259,535
254,006
Current assets Receivables Cash and cash equivalents
2,143
1,619
11,748
14,204
273,426
269,829
273,018
269,395
408
434
273,426
269,829
Liabilities Participants’ account Current liabilities Accounts payable
The return (including price changes and excluding the standard return) in 2011 from the invested funds within Stichting Buma / Stemra Obligatiefonds and Stichting
Buma/Stemra aandelenfonds is 1.3% (2010: 4.8%). The economic recession and the ensuing turmoil in financial markets has led to lower return in 2011.
(4) Accounts receivable The account sreceivable balance at year end consists of accounts receivable which are collected by Buma and debtors of which the collection takes place by the Service
centre. The increase in the accounts receivable balance is primarily caused by a difference in timing of billing.
(5) Other receivables (x € 1,000)
31 December 2011
31 December 2010
1,015
1,834
Stemra current accounts
389
-
SCAN
853
656
Other
475
129
2,732
2,619
Buma members and participants
Buma/Stemra
Notes to the Buma balance sheet as per 31 December 2011
(6) Prepayments (x € 1,000)
31 December 2011
31 December 2010
Cable fees due
2,966
5,782
Interest due
1,578
1,160
Other prepayments
The decrease in Cable fees due is caused by the fact that there is no final agreement on the allocation between the
6,153
5,319
10,697
12,261
different parties of the Kabelcollectief. Therefore the final settlement is not allocated to the various CBOs.
(7) Cash and cash equivalents (x € 1,000)
31 December 2011
31 December 2010
Deposit account
12,832
16,945
Other cash and cash equivalents
15,750
18,912
28,582
35,857
2011
2010
For the rent of the office building, a bank guarantee has been issued for € 0.5 million. All cash and cash equivalentsare freely available.
(8) Continuity reserve The changes can be specified as follows (x € 1,000)
As per 1 January Allocations Withdrawals As per 31 December
There were no withdrawals during the year. The withdrawal in 2010 refers to the completion of the streamlining of the organisation which started in the previous years.
ANNUAL REPORT 2011
1,855
2,367
-
-
-
-512
1,855
1,855
The withdrawal of € 0.5 million was recognised through the profit and loss account (exceptional income and expenses).
49 (9) Appropriated reserve The changes can be specified as follows: (x € 1,000)
2011
2010
As per 1 January
-
-3,253
Allocations
-
3,253
Withdrawals
-
-
As per 31 December
-
-
In 2008 € 6.5 million of the negative result is set aside by means of result appropriation by the board and the board of directors in the appropriated reserve, in order to not fully settle the effects of the stock exchange decline in 2008 with the 2008 collection year. In accordance with the intention of
2008, 50% of the appropriate reserve of 2008 was balanced with the distributions of the 2009 collection year and the remaining 50% is settled with the distributions of the 2010 collection year. There are no withdrawals and allocation in 2011.
(10) Revaluation reserve for financial fixed assets The changes in the revaluation reserve for financial fixed assets can be specified as follows:(x € 1,000)
2011
2010
10,796
9,878
(Un)realised gains/losses arising from price changes
-2,627
3,907
Withdrawals to the credit of the financial result to standard return
-2,015
-2,989
6,154
10,796
As per 1 January
As per 31 December
The (un)realised result in securities amount to € 2.6 million negative (2010: € 3.9 million positive) and are taken directly to the revaluation reserve for financial fixed assets. The results on shares, (convertible) bonds and bond funds are stated at a standard return. The percentage for 2011 was 5.6% (2010: 6.2%) for shares en for fixed-income securities
3.1% (2010: 3.7%). The withdrawal for the benefit of the financial result at a standard return was € 2.0 million (2010: € 3.0 million). The economic recession and the anxiety on the financial markets has led to a decline of the revaluation reserves for financial fixed assets.
Buma/Stemra
Notes to the Buma balance sheet as per 31 December 2011
(11) Provisions The changes in the provisions can be specified as follows: (x â‚Ź 1,000)
Balance as
Additions
Withdrawals
Balance as per
per 1 January
2011
2011
31 December
2011
Long-service awards Reorganisation costs SFB scheme annual allowance Indemnifaction obligation
Provision for long-service awards The provision for long-service awards is a provision for future long-service awards, calculated on the basis of actuarial assumptions with regard to indexation and life expectancy. The calculation is based on the commitments made, stay probability and age.
Provision for reorganisation costs The provision for estimated severance payments is entirely settled in 2011.
2011
419
107
-
526
139
-
-139
-
10,035
-
-1,483
8,552
581
453
-581
453
11,174
560
-2,203
9,531
the SFB as yet is recognised. The expected remaining term of the provision is until the end of 2022, and it has been calculated on the basis of the nominal amounts of the annual allowances with actuarial assumptions with regard to indexing and life expectancy. The provision was formed from the Fund for cultural and social purposes; releases are part of the deductions and taken to the Fund.
Provision for obligation to indemnify Provision for SFB scheme annual allowance The provision for annual SFB allowances concerns a provision for the actual obligations by virtue of the annual allowances paid to (former) authors and publishers and their posterity through the Stichting Sociaal Fonds Buma (SFB). Although the obligations have been included provisionally, there is a firm intention to meet the obligations. The part of the provision for which no subsidy has been committed to
ANNUAL REPORT 2011
As a party to the agreements concluded with cable operators concerning copyright arrangements for transmission of programmes from broadcasting companies, Buma has undertaken obligations with regard to copyright claims that could be enforced against cable operators by third parties, not represented in the matter by Buma. In respect of obligations to indemnify arising from these agreements, the provision for obligations to indemnify amounts to 3% of the monies collected. The addition/ withdrawal takes place to the debit/credit of the collection.
51 (12) Fund for cultural and social purposes The changes can be specified as follows (x â‚Ź 1,000)
2011 As per 1 January Allocations Withdrawals As per 31 Decemberš)
2010
17,168
17,557
9,581
10,212
-11,726
-10,601
15,023
17,168
The balance as at 31 December 2011 can be specified as follows:
2008 and older
14,859
2009
164
2010
-
2011
15,023
In 2010 and 2011 the withdrawals from the Fund for cultural and social purposes are higher than the allocations. Therefore the balance of these two years is deducted from the balance of year 2008 and earlier. The years 2010 and
2011 are therefore zero. In 2011 the deduction on the royalties to be distributed and therefore the allocation to the funds was determined by the board on 8% (2010: 8.5%). â‚Ź 13.3 million of the total funds has a short term nature.
Buma/Stemra
Notes to the Buma balance sheet as per 31 December 2011
The expenditures of the Fund for cultural and social purposes are: (x â‚Ź 1,000)
2011
2010
1,335
1,460
Social Commitment to Social Fund Buma Last year settlement SFB Pension scheme authors and publishers Others
-208
-171
2,221
2,507
8
8
3,356
3,804
6,141
4,127
Cultural Commitment to Buma Cultuur Last year settlement Buma Cultuur
-749
-491
Surcharge Serious category /Online
2,100
2,350
200
-
Direct funding cultural projects
131
188
Professional associations
214
199
Geneco 100 years
Others
Total expenditures
The surcharge Serious / Online is a withdrawal from the Fund for the distribution to the right holders in the category serious music and online expenses. The surcharge Serious and Online will be paid out in the first quarter of 2012. The entry others under Cultural concerns expenses attributed to the protection of copyright.
ANNUAL REPORT 2011
333
424
8,370
6,797
11,726
10,601
53 (13) Royalties to be distributed (x € 1,000)
2011
2010
Royalties to be distributed at the beginning of the year
162,211
156,536
Royalties turnover
142,948
140,346
-9,092
-8,319
296,067
288,563
Members and participants
70,345
67,440
Foreign organisations
43,799
46,549
9,581
10,212
Changes in royalties to be distributed Available for distribution Distributed in the reporting year:
Fund for cultural and social purpose
1,838
2,151
Distribution incl. administrative costs charged
125,563
126,352
Royalties to be distributed at the end of the year
170,504
162,211
Administrative costs charged
The available amount to be processed for distribution is € 8.3 million higher than in 2010. The reason for this increase is mostly because Buma’s turnover increased with an average of € 3.0 million per year in the past two years. The effect of this increase will be visible in 2012, where in the first few months already € 5.0 million more was distributed in the categories Post distributions, general rights, film and satellite, than in the same period in 2011.
These royalties are accounted for in the amount of royalties to be distributed at the end of 2011. In addition, the method for the setting of music in commercials is changed. This enables us to ultimately distribute more for the use of music in commercials. This process has also shown that the use of music in commercials is higher, therefore the reservation for this cause was higher in 2011.
Buma/Stemra
Notes to the Buma balance sheet as per 31 December 2011
The structure of the royalties to be distributed is as follows: (x â‚Ź 1.000)
Reservation for copyrights Reservation for double claims To be distributed collection year
2011
2010
38,094
34,690
6,236
5,622
126,174
121,899
170,504
162,211
Per year of collection:
2011 Older than 2008
5,399
2008
9,027 3,335
2008 plus-packages
12,605
2009 2010
18,146
2011
121,992 170,504
The reservation for collection year 2008 consists among others of the so-called plus-packages. Because of the amount in combination with the long lead time to get
to a correct distribution the plus-packages are mentioned separate in. The distribution of the plus-packages will take place in 2012.
Available for distribution Buma (x â‚Ź 1,000)
2011 Royalties turnover Release of reservation of rights
2010
142,948
140,346
4,327
4,715
-9,092
-8,319
Became available for distribution during the year
138,183
136,742
To be distributed at the beginning of the year
162,211
156,536
Changes in royalties to be distributed
Available *
133,856
132,027
Distributed
-125,563
-126,352
170,504
162,211
Royalties to be distributed at the end of the year
* Excluding indivisible rights which have already been accounted for in the opening balance sheet
ANNUAL REPORT 2011
55 Of the available amount to be processed for distribution in 2012, € 4.3 million will be added to the distribution of the released reserved rights (2010: € 4.7 million, distributed in the 2011 payment).
The negative result for 2011 amounts is € 9.1 million (2010: € 5.1 million negative). The negative result was deducted from the royalties to be distributed (2010: € 8.3 million).
Distribution of Buma’s turnover (x € 1,000)
2011
2010
Radio & TV Performing Rights
51,863
50,228
Live
20,363
19,899
Hospitality Industry
15,047
17,015
Workplaces
17,600
17,799
Shops and stores
12,827
11,940
1,471
757
Performing Rights Online Licensing Cable
11,886
12,168
Performing Rights Abroad
11,891
10,540
142,948
140,346
The amount available for distribution (including addition for the release of reservation rights) is allocated to the different categories as follows: (x € 1,000)
2011
2010
Live entertainment
15,845
16,335
Mechanical entertainment
38,090
38,345
Radio
5,761
5,868
Television
7,572
7,637
Film
3,134
2,403
Serious categories
2,991
3,222
Cable
10,562
10,859
Satellite
32,755
31,321
International
11,892
10,540
9,581
10,212
138,183
136,742
Fund for cultural and social purposes
Buma/Stemra
Notes to the Buma balance sheet as per 31 December 2011
(14) Other liabilities (x € 1,000)
31 December 2011
31 December 2010
Sister organisations abroad
26,169
26,064
Obligations arising from social and cultural purposes
17,791
16,971
Buma members and participants Current account Stemra Other
The amounts owed to sister organisations abroad were largely settled at the beginning of 2012.
250
752
-
949
3,402
4,437
47,612
49,173
The obligations arising from social and cultural purposes are (x € 1,000): • Buma Cultuur € 6,281 (31/12/2010: € 5,309) • Pension scheme authors and publishers € 5,404 (31/12/2010: € 5,071) • Social fund Buma € 3,955 (31/12/2010: € 4,339) • Surcharge category Serious and Online € 2,151 (31/12/2010: € 2,252
(15) Other payables and deferred income (x € 1,000)
31 December 2011
31 December 2010 *
Third parties cable right owners
5,183
4,882
Holiday allowance/annual leave
796
793
533
1,176
6,512
6,851
Other
* Adjusted for comparison purposes
ANNUAL REPORT 2011
57 Off-balance sheet commitments Partially pledged bond portfolio In accordance with the decision of the Board, at the end of 2002, part of the bond portfolio of Stichting Buma/Stemra Obligatiefonds amounting to € 27.8 million was pledged as a security to ING Bank N.V. in connection with a cash facility needed for normal operations. The cash facility is € 25.0 million. This facility was not used in 2011.
Longterm financial liabilities The financial liabilities with regard to the business accommodation in Hoofddorp was prolonged until 31 December 2017. The rental obligation is incurred by Buma. The combined annual rent for Buma/Stemra amounts to € 1.3 million, which is divided between Buma and Stemra on the basis on 75% / 25% In the current composition, the annual amount for the leasing of cars by Buma/Stemra is € 0.2 million. The liability for terms longer than one year is € 0.4 million. The financial liability for the rent of the printers was entered into until 1 May 2013. The annual rent amounts to € 0.1 million. The obligations with respect to the car lease and the printers are incurred by Buma. The lease costs will be for 75% on the account of Buma and for 25% on the account of Stemra.
Related parties Related parties of Buma Association are distinguished in: Stemra foundation, Buma Cultuur foundation (and according that foundation Amsterdam Dance Events foundation and Buma Rotterdam Beats foundation), Social Fund Buma foundation, the Service Centre and the statutory board and the board members of the Vereniging Buma and Stichting Stemra. More information about the renumerations of the board members and the statutory management can be found in note 17. Regular transactions on account of the exploitation of copyrights to board members or to board members related parties are not explicitly explained in the financial statements. Both Buma Cultuur foundation and Social Fund Buma foundation receive funds to implement their goals from the Fund for Social and Cultural purposes. More information about this can be found in note 12. Vereniging Buma charges Stichting Stemra, Stichting Buma Cultuur, Stichting Sociaal Fonds Buma and the Service Centre on to personnel, accommodation and overhead costs. The by charge costs for 2011 amount to: • Stemra foundation • Buma Cultuur foundation
Buma/Stemra entered into a contract allowing Accenture to perform a large portion of Buma/Stemra’s back office activities from 2007 until 31 March 2017. The resulting financial liability amounts to € 15.3 million for the remaining duration of the contract, assuming consistent volumes. The costs of the back office activities are divided on a 75% respectively 25% proportion for Buma and Stemra.
• Social Funds Buma Foundation • Service Centre
€ 4,328,000 € 149,000 € 40,000 € 1,098,000
The by charge is based on cost price.
The off-balance sheet commitments of € 20.8 million can be summarised as follows: • less than 1 year:
€
4.5 million 14.5 million € 1.8 million
• between 1 and 5 years: € • longer than 5 years:
Joint and several liability Vereniging Buma is jointly and severally liable for the acts of Stichting Service Centrum Auteurs- en Naburige Rechten (the Service Centre) resulting debt and guarantees the fulfillment of the obligations of the foundation to a maximum of € 1.0 million.
Buma/Stemra
Notes to the Buma profit and loss account for 2011 (16) Budget Below both the budgets for 2011 as 2012 are presented. The actual figures for 2011 are incorporated for comparison. Standard return was not taken into account in the budgets 2011 and 2012. The budget from ordinary activities for 2012 is € 11.4 million negative compared to € 9.1 million negative in 2011. This decline is due to a lower budgeted financial result. On the other hand there is an increase in the budgeted expenses in particular for fingerprinting, the Service centre and (IT) projects.
Also, both the budgeted revenue distribution 2012 and 2011 is shown, included the actual turnover of 2011 for comparison. The increase in the budget 2012 compared to the budget 2011 is particularly attributable to an expected increase in the categories Radio & TV performing rights. With respect to the actual figures of 2011, an increase can be expected in the category cable For a further explanation of the budget we refer to the director’s report.
(x € 1,000)
Budget 2012
Realisation 2011
Budget 2011
Income 1,700
1,838
1,988
Entrance fees and annual allowances
600
617
546
Other income
600
Administrative costs charged
696 2,900
600 3,151
3,134
Expenses Personnel expenses
9,540
10,085
9,838
Office and accommodation costs
1,350
1,438
1,488
450
368
420
8,395
8,169
6,528
Depreciation and amortisation expenses Other expenses
Operating result Interest and dividends Standard return¹ Financial result Result from ordinary activities
19,735
20,060
18,274
-16,835
-16,909
-15,140
5,428
5,802
6,051
-
2,015
-
5,428
7,817
6,051
-11,407
-9,092
-9,089
¹ The standard return consists of exchange results. Exchange results are not accounted for in the budget.
ANNUAL REPORT 2011
59 Distribution of Buma’s turnover (x € 1,000)
Budget 2012
Realisation 2011
Budget 2011
Radio & TV Performing Rights
51,650
51,863
48,557
Live
20,850
20,363
20,082
Hospitality Industry
15,750
15,047
15,984
Workplaces
17,250
17,600
16,686
Shops and stores
13,600
12,827
12,574
2,300
1,471
1,899
Cable
13,500
11,886
13,000
Performing Rights Abroad
11,100
11,891
11,750
146,000
142,948
140,532
Performing Rights Online Licensing
Expenses (17) Personnel expenses (x € 1,000)
2011
2010
Salaries
9,121
8,473
Social security contributions
1,129
1,030
Pension contributions Other personnel expenses
Charged /compensated to third parties
The combined cost of Vereniging Buma and Stichting Stemra are divided in the ratio 75% / 25%. Directly attributable costs are 100% accounted for in the entity’s financial statements. The average number of employees during the reporting year was 176 employees (2010: 173 employees), which correspond to an average of 164.3 FTE (2010: 166.5 FTE)
832
1,032
2,539
2,652
13,621
13,187
-3,536
-5,036
10,085
8,151
This includes: • An average 5 employees (2010: 4 employees) is charged
on to SCAN, which corresponds to an average of 4.6 fte (2010: 4.0 FTE) • Employees who are working partly for Stemra, of which part of the costs are charged on to Stemra • 1.0 FTE which is charged on to other affiliated foundations
Buma/Stemra
Notes to the Buma profit and loss account for 2011
The work force (average number of FTE) can be divided into various categories of staff:
Board of directors and support staff to the Board
5.4
Legal Affairs
6.1
General Affairs
41.7
Front Office
64.0
Back Office
47.1 164.3
Salary Buma Board and statutory executive director Buma/Stemra for the year 2011 (x € 1,000)
Buma Board Fee for 12 members of the government Buma (incl. expense allowance)
101
H.W. van der Ree
C. van Rij
Executive director
Legal Affairs director
100%
100%
Indefinite duration
Indefinite duration
1/1 - 31/12
1/1 - 1/11
304
207
52.5
15
3
3
Statutory directors Buma/Stemra Function Full Time Equivalent Type of contract Contract in 2011
Fixed remunerations and fees Variable remunerations and fees Expense allowance
53
23
Social security costs
8
0
Termination payments
-
Pension charges
¹ The termination payment is based on the clauses in the labour contract regarding the so-called ‘Kantonrechtersformule’ (County judge formula).
ANNUAL REPORT 2011
700¹
61 The salary of the statutory directors Buma/Stemra is for 75% recognised in the financial statements of Vereniging Buma and for 25% on the account of Stichting Stemra.
(18) Other expenses (x € 1,000)
2011
2010
Rent, Lease & Maintenance
620
605
Supplies and stationery
344
443
Commercial expenses Outsourcing
324
263
1,316
2,055
Outsourcing IT
1,715
1,661
Other IT expenses
1,383
1,296
Consulting
1,719
1,254
Service agencies
2,222
1,434
Other overhead
Expenses charged on ¹
880
708
10,524
9,719
-2,354
-2,672
8,169
7,047
¹ The expenses charged on are charged on to costs to Stemra and third parties.
The increase in Consultancy costs is partly due to costs of renegotiating the rental agreement. There was also an increase in the use of external lawyers. The decrease in Outsourcing costs is due to the relocation of back office activities from Prague to India. The increase in Service
Bureaus are mainly due to the increased activities of the Service Centre. This increase results in a decline of personnel costs for Buma. The net effect is an increase of € 0.5 million. This increase is due to file matching costs and extra Service Centre marketing costs.
Buma/Stemra
Notes to the Buma profit and loss account for 2011
(19) Audit fees The following fees of KPMG Accountants are charged to Buma, as referred to in Article 2:382a BW (x â‚Ź 1,000).
2011 Other
Total
KPMG network
KPMG network
106
-
106
24
6
30
Tax Consultancy
-
58
58
Other non-audit services
-
23
23
130
87
217
KPMG Accountants N.V.
Financial statement audit Other audit assignments
2010 KPMG Accountants N.V.
Other
Total
KPMG network
KPMG network
Financial statement audit
106
-
106
Other audit assignments
24
15
39
Tax Consultancy
-
51
51
Other non-audit services
-
29
29
130
95
225
(20) Financial result (x â‚Ź 1,000)
2011
2010
2,628
1,605
Interest income and other income Fixed income securities Interest received on bonds Shares Share dividend received
3,304
3,509
5,932
5,114
2,015
2,989
Mutations revaluation reserve Withdrawals from revaluation reserve for the benefit of the financial result at a standard return Other interest income and similar income Total income from investments Interest expenses and other costs
ANNUAL REPORT 2011
427
707
8,374
8,810
-557
-314
7,817
8,496
63 The increased interest on bonds is partly caused by higher interest income on government bond funds, partly due to sold state bond funds and a reinvestment in state bonds. The lower withdrawal from the revaluation reserve is partly due to a lower effective yield on the 5-year Euro bonds, which is used for the calculation of the effective yield. Less interest as well as less dividend was received in 2011 by BSO / BSA. Buma realised an increase in received
interest on bonds, but this increase was due to the distribution of the financial result of BSO / BSA, due to the higher share in BSO / BSA in 2011 than in 2010 (2011: 79.9% / 20.1%; 2010: 63,5% / 36.5%). This increase of 16.4% is due to a sell of participation by Stemra to Buma worth € 69.5 million. This consisted of the redemption of a loan in current accounts from Buma to Stemra worth € 55.7 million, a clearance of € 13.3 million from BSA/BSO and an expansion of liquid means of Stemra by 0.5 million.
Buma board
Mr L.A.J.M. de Wit
Chairman a.i.
Mr drs. S.A.A. Abdoelbasier
Board Member
Mr J.A. van Bergen
Board Member
Mr A.J.H. van Berkel
Board Member
Mr M.A. Bremer
Board Member
Mr P.M. van Brugge
Board Member
Mr H.C.M. de Clercq
Board Member
Mr L.A. Dikker
Board Member
Mr mr. H. Kosterman
Board Member
Mr M.W. Mensink
Board Member
Mr T.J.M. Peters
Board Member
Mr A.A.L. de Raaff
Board Member
Mr drs. H.O. Westbroek
Board Member
Director
Mr H.G. van der Ree
statutory Executive Director
Amstelveen, April 4th 2012
Buma/Stemra
Other information To: The Board and the general meeting of Vereniging Buma
Independent auditor’s report
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
We have audited the accompanying financial statements 2011 set out on pages on pages 37 to 63 of Vereniging Buma, Amstelveen, which comprise the balance sheet as at 31 December 2011 and the profit and loss account for the year then ended and the notes, comprising a summary of the accounting policies and other explanatory information.
In our opinion, the financial statements are prepared, in all material respects, in accordance with the accounting policies selected and disclosed by the Association, as set out in notes to the financial statements.
The board’s responsibility The board of the Association is responsible for the preparation of the financial statements in accordance with the accounting policies selected and disclosed by the Association, as set out in notes to the financial statements. Furthermore, the board is responsible for such internal control as it determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Opinion
Basis of accounting and restriction on distribution and use We draw attention to notes to the financial statements, which describes the basis of accounting. The accounting policies used are selected and disclosed by the Association. Our opinion is not qualified in this respect. Amstelveen, 4 April 2012
KPMG Accountants N.V. Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. This requires that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the board, as well as evaluating the overall presentation of the financial statements.
ANNUAL REPORT 2011
R.J. Groot RA
65 Profit appropriation For Buma, the result for 2011 will be deducted from the royalties to be distributed. Based on an assessment of the reserve, it will be determined to what extent funds will have to be added to or deducted from the reserves. This movement will also be credited or charged to the royalties to be distributed.
Proposal of the board of directors As shown in the financial statements, which were prepared in accordance with Article 26 note 2 of the Articles of Association, the board of directors proposes to deduct the negative result of â‚Ź 9.1 million from the royalties to be distributed. The proposal has already been incorporated in the 2011 financial statements.
Buma/Stemra
ADE Lights Melkweg Photo Justin Rompas, Betribes.com
Stemra Financial statements 2011
Stemra balance sheet
Stemra balance sheet as at 31 December 2011 After appropriation of the result (x â‚Ź 1,000)
31 December 2011
31 December 2010
Assets Fixed assets Tangible fixed assets (1) Financial fixed assets (2)
250
210
52,273
51,159 52,523
51,369
Current assets Accounts receivable
1,629
4,868
Other receivables (3)
4,357
4,180
Taxes and social security contributions
815
997
Prepayments (4)
741
288
Cash and cash equivalents (5)
3,674
6,305 11,216
16,638
63,739
68,007
Liabilities Reserves Foundation capital Continuity reserve (5) Appropriated reserve (7) Revaluation reserve for financial fixed assets (8)
1
1
5,760
5,760
-
-
4,390
5,561 10,151
11,322
64
213
Provisions Provisions (9) Current liabilities
38,738
38,755
Accounts payable
1,088
762
Other liabilities (11)
4,400
4,788
55
112
9,243
12,055
Royalties to be distributed (10)
Taxes and social security contributions Other payables and deferred income (12)
ANNUAL REPORT 2011
53,524
56,472
63,739
68,007
69
Stemra profit and loss account for 2011 Stemra profit and loss account for the year ended 31 December 2011 (x â‚Ź 1,000)
2011
2010
Income Administrative costs Entrance fees and annual allowances Other Income
3,134
3,096
617
604
50
3,801
3,700
Expenses 3,251
5,018
Office and accommodation costs
479
761
Depreciation and amortisation
134
171
Personnel expenses (14)
Other expenses (15)
1,833
2,291 5,697
8,241
-1,896
-4,541
1,952
4,821
56
280
Exceptional income
-
169
Exceptional expenses
-
-169
56
280
-
1,300
Operating result
Financial result (17)
Result from ordinary activities
Result Result appropriation Result allocated to appropriation reserve Result deductions from continuity reserve Changes in royalties to be distributed
-
-
56
-1,020
Buma/Stemra
Stemra cash flow statement
Stemra cash flow statement for the year ended 31 December 2011 (x € 1,000)
2011
2010
Cash flow from turnover and distribution (10)
Turnover
32,138
35,662
Distribution
-32,211
-36,750 -73
-1,088
Cash flow from operating activities
Administrative costs charged (10) Other income Financial result
Total expenses Correction for depreciation and amortisation
Changes in continuity reserve Changes in provisions
3,134
3,096
667
604
1,336
2,590
5,137
6,290
-5,697
-8,241
134
171
-5,563
-8,070
-
-169
-149
-166
Changes in other receivables
2,898
-2,868
Changes in other liabilities
-2,931
-45,118¹
-182
-8,070
-48,321 -608
-50,101
Cash flow from direct investment activities
Investments in tangible fixed assets (1)
-174
-157 -174
-157
Cash flow from indirect investment activities
Purchase of securities Repayments/sales proceeds
-31,205
-10,790
29,429
Net Cash flow Cash and cash equivalents as per 1 January
6,305
Cash and cash equivalents as per 31 December
3,674
Changes in cash and cash equivalents
53,793 ¹ -1,776
43,003
-2,631
-8,343 14,648 6,305
-2,631
-8,343
¹ This concerns the repayment of the loan in current account to Buma and investments BSO/BSA at the end of 2010. For more information we refer to the notes of the financial statements 2010.
ANNUAL REPORT 2011
Notes to the Stemra balance sheet and profit and loss account General Stemra Foundation’s objectives Stichting Stemra (Stemra foundation) its registered office is in Amstelveen. The Foundation its objective is to represent and promote both the tangible and intangible interests, without motive of profit, of music authors and publishers and other copyright owners, in particular with regard to mechanical reproduction rights. The Foundation’s other goals are exercising and maintaining mechanical reproduction rights for participating authors, participating publishers, as well as other authors and copyright owners. The Foundation participates in the implementation and promotion of various activities to achieve its objective.
Principles for the valuation of assets and liabilities and the determination of the result The principles adopted for the valuation of assets and liabilities and determination of the result are based on historical costs unless otherwise explained. If not stated otherwise, assets and liabilities are stated at face value. Income and expenses are allocated to the period to which they apply. The Voice certification criteria were taken into account in preparing the financial statement. As a result of these criteria for Collective Right Managements Organisations, additional information was added and the annual returns of 2010 were reclassified for comparison (to the figures of 2011).
Accounting principles for the translation of foreign currency Transactions denominated in foreign currency are translated to euros at the applicable exchange rate on the transaction date. Monetary assets and liabilities denominated in foreign currency are translated to euros at the exchange rate applicable on balance sheet date. Exchange rate differences are taken to the profit and loss account. Non-monetary assets and liabilities denominated in foreign currency that are valued on the basis of historical costs are translated at the applicable exchange rate on the transaction date.
71
Principles of consolidation For transparency purposes Stichting Buma/Stemra Obligatiefonds and Stichting Buma/Stemra Aandelenfonds are included in the Stemra financial statements by means of proportional consolidation. Assets and liabilities, as well as income and expenses, are proportionally included to the participating interests. No separate financial statements for Stemra is included, but the information is provided in the notes.
Deviations from BW2 Title 9 The most important deviations from BW2 Title 9 - Civil Code for the valuation of assets and liabilities and determination of results is the application of the standard return on investments. Price gains/losses arising from the valuation of securities at market value are not directly taken to the trading account, but are first included in the revaluation reserve for financial fixed assets (hereinafter: ‘revaluation reserve’). If the position of the revaluation reserve is sufficient at the end of the year, a so-called standard return can be recognised in the financial results. According to the Guidelines for Annual Reporting (Richtlijnen voor de Jaarverslaggeving) the abovementioned trading results should be recognised directly in the profit and loss account. Buma/Stemra applies the methodology to account for a consistent development of the financial results in the profit and loss account and to align the financial result with the long-term objective of the investment strategy.
Tangible fixed assets Tangible fixed assets are based on historical cost less cumulative depreciation. The depreciation is calculated as a percentage of the purchase price according to the straight line method basis on the expected economic life.
Buma/Stemra
Notes to the Stemra balance sheet and profit and loss account
The following expected economic life terms are applied: 3 years
• Computer equipment
on bond funds is withdrawn from the revaluation reserve, if possible.
Accounts receivable
Continuity reserve
Accounts receivable are stated at nominal value less a provision for bad debts.
The continuity reserve’s aims include guaranteeing the continuity of the work. It also serves to fulfil obligations in respect of third parties, in particular with regard to distribution of the royalties yet to be distributed in accordance with the financial statements. This reserve furthermore serves to level out unwanted fluctuations in the amounts available for distribution, resulting, among other things, from domestic and international pressure on turnover, as well as continuing changes in the distribution of rights.
Financial fixed assets The securities included under financial fixed assets are listed shares, bond funds, and (convertible) bonds. Securities are stated at market value as at balance sheet date.
Revaluation reserve for financial fixed assets Price gains/losses arising from the valuation of securities at market value are not directly taken to the trading account, but are first included in the revaluation reserve for financial fixed assets (hereinafter: ‘revaluation reserve’). To the extent that the revaluation reserve is insufficient, the deficit is charged to the result. Each year, the size of the revaluation reserve needed to absorb price fluctuations is determined by the Board in consultation with its asset managers. If the revaluation reserve is larger than deemed necessary, this surplus is eligible for addition to the royalties to be distributed.
Financial result and standard return Dividends are accounted for in the period in which they are made payable; interest income is accounted for in the period to which it relates. Insofar as the balance of the revaluation reserve, less a possible appropriate reserve for (un)realised gains or losses arising from changes in market prices, leaves room for this, a ‘standard return’ is included in the financial result, in addition to any receivable share dividend and interest on bond funds. In the calculation of the standard return, the dividend and interest already paid out are taken into account, and only the difference between the dividend/interest received and the standard return is settled with the revaluation reserve. The standard return is calculated as a percentage of the average value of the shares and bond funds over the financial year, and comprises the effective return on 5-year euro government bonds at the end of the financial year plus a risk mark-up for shares. The difference between the standard return and the dividend received on shares or interest received
ANNUAL REPORT 2011
Appropriated reserve Appropriated reserves are parts of reserves that management has set aside for a special purpose. In this case, it concerns the appropriated reserve for (un) realised gains/losses arising from changes in market prices. For more detailed information on this reserve, please refer to the notes to the balance sheet.
Provisions Provisions are measured at either the nominal value of the estimated expenditure required to settle liabilities and losses, or the present value of that expenditure. A provision is mentioned in the balance sheet when there is: • a legal or constructive obligation as a result of a past event, and • of which a reliable estimate can be made, and • it is probable a cash outflow is necessary to settle the obligation. The long-service awards provision is a provision for future long-service awards. The provision is the present value of future benefits to be paid for long-service awards. The calculation is based on commitments and age.
Reservations royalties to be distributed In the process of distribution three types of reservations are made. First of all reservations are created for the event that insufficient information is available in order to distribute. For example, because of the lack of data of the right owners, copyright information and the missing of so-called cuesheets for movies, shows or commercials. Secondly, reservations are made for works which the cumulative earnings per work have not yet achieved the
73 lower limit for distribution. These funds are segregated until this information is available or the lower limit has been reached and the money can be distributed in the post-distribution. Finally, a reservation is made ​​for complaints relating to the distribution, this in order to the indemnification that Buma provides to the users of music. This reservation is determined by a percentage of the funds per distribution based on the historical course of the amount paid on complaints per distribution category. The percentage of reservation for these complaints is usually between 0 and 2%. In addition, works for which there is a so-called double claim (two owners claim the same work) are reserved until this situation is resolved mutually. These amounts are also recognised in amount of royalties to be distributed. Except the so-called double claims, all reservations are released after a maximum of 3 years. This in accordance with the certified criteria. In addition, a longer reservation period is used for monies that Stemra has received from sister organisations but for which no information is available to do a proper distribution and with regard to monies set aside for claims in the past.
Determination of the result Income and expenses are accounted for in the year to which they apply. The result is determined by calculating the difference between the balance of realised income and expenditure and the financial result for the year.
In the event of a shortfall in the sector pension fund, Stemra has no obligation to pay additional contributions other than higher future premiums. The coverage ratio of the Foundation Sector pension fund for the media PNO for the end of December 2011 amounted to 90.7%.
Turnover In the financial statements, the turnover in royalties is added to the to be distributed royalties. Stemra includes the exploitation of mechanical rights in the turnover, insofar as these relate to the financial year, can be determined in a reliable manner, and there is reasonable certainty that the revenue is collectible.
Tax With regard to Stemra, the Dutch tax authorities stipulated in an agreement dated 6 November 2001, determining the legal relationship between the parties, that Stichting Stemra is liable to pay corporation tax. This agreement was extended at the end of 2008 for a period of three years, and is valid until 31 December 2011. Foreign withholding tax available for set-off and Dutch dividend tax may be deducted from the tax due by virtue of this agreement determining the legal relationship between parties. A tax item is only included in the financial statements if corporation tax is still owed after deduction of the foreign withholding tax available for set-off.
Accounting principles for cash flow statement
The balance of the profit and loss account is allocated/ deducted from the royalties to be distributed and/or the reserves by means of profit appropriation.
The cash flow statement is drawn up using the indirect method. Exchange rate differences, like all other movements, are eliminated for so far they had not let to a cash flow. The term cash and cash equivalents is used in the balance sheet in the same way as in the cash flow statement.
Pension plans
Use of estimates
Stichting Stemra has made a pension scheme arrangement for its employees where pension benefits are based on average salary. The plan is administered by the Foundation Sector pension fund for the media PNO. The premiums due for the financial year are recognised as expenses. Premiums that are not paid at balance sheet date are recognised as a liability. Since these liabilities have a short term nature, they are stated at their nominal value. The risks of salary developments, price indexation, investment returns on the fund assets might possible lead to future changes in annual contributions to the pension fund. These risks are not reflected in a balance sheet provision.
Drawing up the financial statements requires management to form opinions and make estimates and assumptions that influence the application of principles and the reported value of assets and liabilities, and of income and expenses. The estimates and the associated assumptions are based on past experience and various other factors that are considered reasonable in view of the circumstances. The outcome forms the basis for the opinion on the carrying value of assets and liabilities that does not emerge clearly from other sources.
Buma/Stemra
Notes to the Stemra balance sheet as at 31 December 2011 The actual results may differ from these estimates.
(1) Tangible fixed assets The changes in the tangible fixed assets can be specified as follows (x € 1,000)
Computer equipment 1,511
Actual cost as per 1 January 2011
-1,301
Accumulated depreciation
210
Carrying amount Changes during the financial year: Investments
174
Depreciation
-134 40 1,685
Actual cost as per 31 December 2011
-1,435
Accumulated depreciation
250
Carrying amount
3
Depreciation in number of years on average
(2) Financial fixed assets The fair value of the portfolio at the end of 2011 is € 52.3 million and it can be specified as follows: (x € 1,000)
2011 Fixed income securities Equity funds
40,572
78%
2010 40,477
11,701
22%
10,682
21%
52,273
100%
51,159
100%
Fixed
Equity
Total
Income
funds
The movements of the individual items can be displayed as follows (x € 1.000):
securities
Balance as per 1 Januari Acquisitions Repayments / Sales Price movements Balance as per 31 December
ANNUAL REPORT 2011
79%
40,478
10,682
51,160
29,329
1,876
31,205
-29,386
-43
-29,429
151
-814
-663
40,572
11,701
52,273
75 Securities and bonds of Stichting Stemra are valued at market value. Valuation differences on bonds and shares are charged or credited to the revaluation reserve for financial fixed assets. Stemra’s securities and bonds have been placed in Stichting Buma/Stemra Obligatiefonds and Stichting Buma/ Stemra Aandelenfonds. The foundations are proportionally consolidated in financial statements of Stemra and Buma
at an average percentage of respectively 20.9% and 79.9% (2010: 20.1% en 79.9%).The above mentioned amounts are the proportion of the total amount as shown in the fully-combined financial statements of Stichting Buma/ Stemra Obligatiefonds (BSO) and Stichting Buma/Stemra Aandelenfonds (BSA). The main movements in the fixed income securities concern in particular the conversion of (government) bond funds to bonds in order to minimise the risks in the Eurozone countries.
The fully-combined balance sheet of Stichting Buma/Stemra Obligatiefonds (BSO) and Stichting Buma/Stemra Aandelenfonds (BSA) can be respresented in condensed form as folows: (x â‚Ź 1,000)
31 December 2011
31 December 2010
Assets Fixed assets Financial fixed assets
259,535
254,006
Current assets Receivables Cash and cash equivalents
2,143
1,619
11,748
14,204
273,426
269,829
273,018
269,395
408
434
273,426
269,829
Liabilities Participants’ account Current liabilities Creditors
The return (including price changes and excluding the standard return in 2011 from the invested funds within Stichting Buma/Stemra Obligatiefonds and Stichting
Buma/Stemra Aandelenfonds is 1.3% (2010: 4.8%). The economic recession and the ensuing turmoil in financial markets has led to lower return in 2011.
Buma/Stemra
Notes to the Stemra balance sheet as at 31 December 2011
(3) Other receivables (x € 1,000)
31 December 2011 Stemra members and participants Buma current accounts Other
31 December 2010
4,337
3,214
-
949
20
17
4,357
4,180
(4) Prepayments (x € 1,000)
31 December 2011
31 December 2010
Interest due
395
288
Other prepayments
346
-
741
288
(5) Cash and cash equivalents (x € 1,000)
31 December 2011
31 December 2010
Deposit account
1,738
2,781
Other cash and cash equivalents
1,936
3,524
3,674
6,305
All the cash and cash equivalents is freely available.
ANNUAL REPORT 2011
77 (6) Continuity reserve The changes can be specified as follows (x € 1,000)
Balance as per 1 January Allocations Withdrawals Balance as per 31 December
There were no withdrawals in 2011. The withdrawal in 2010 (€ 0.2 million) refers to the completion of the streamlining of the organisation which started in the previous years.
2011
2010
5,760
5,929
-
-
-
-169
5,760
5,760
The withdrawal of € 0.2 million was recognised through the profit and loss account (exceptional income and expenses).
(7) Appropriated reserve The changes can be specified as follows (x € 1,000)
2011
2010
Balance as per 1 January
-
-1,300
Allocations
-
1,300
Withdrawals
-
-
Balance as per 31 December
-
-
In 2008 € 2.6 million of the negative result is set aside by means of result appropriation by the Board and the board of directors in the appropriated reserve, in order to not fully settle the effects of the stock exchange decline in 2008 with the 2008 collection year. In accordance with the intention
of 2008, 50% of the appropriate reserve of 2008 was balanced with the distributions of the 2009 collection year and the remaining 50% is settled with the distributions of the 2010 collection year. There were no withdrawal and/or allocations in 2011.
Buma/Stemra
Notes to the Stemra balance sheet as at 31 December 2011
(8) Revaluation reserve for financial fixed assets The changes in the revaluation reserve for financial fixed assets can be specified as follows: (x € 1,000)
2011
2010
5,561
5,683
(Un)realised gains/losses arising from price changes
-663
2,247
Withdrawals to the credit of the financial result to standard return
-508
-1,719
-
-650
4,390
5,561
Balance as per 1 January
Withdrawals allocated to Financial result Balance as per 31 December
The (un)realised gain in securities amount to € 0.7 million (2010: € 2.2 million) and are taken directly to the revaluation reserve for financial fixed assets. The results on shares, (convertible) bonds and bond funds are stated at a standard return. The percentage for 2011 was 5.6% (2010: 6.2%) for shares en for fixed-income securities 3.1% (2010: 3.7%).
The withdrawal for the benefit of the financial result at a standard return was € 0.5 million (2010: € 1.7 million). The withdrawal for the benefit of the financial result was 0 (2010: € 0.7 million). The economic recession and the anxiety on the financial markets has led to a decline of the revaluation reserves for financial fixed assets.
(9) Provisions The changes in the provisions can be specified as follows: (x € 1,000)
Balance as per
Additions
Withdrawals
Balance as per
1 January
2011
2011
31 December
2011
Long-service awards Reorganization costs
Provision for long-service awards The provision for long-service awards is a provision for future long-service awards, calculated on the basis of actuarial assumptions with regard to indexation and life expectancy. The calculation is based on the commitments made, stay probability and age.
Provision for reorganisation costs
ANNUAL REPORT 2011
2011
74
-
-10
139
-
-139
-
213
-
-149
64
The expectation is that the provision for estimated severance payments will largely be settled in 2011.
64
79 (10) Royalties to be distributed (x € 1,000)
2011
2010
Royalties to be distributed at the beginning of the year
38,755
40,863
Royalties turnover
32,138
35,662
56
-1,020
70,949
75,505
24,394
28,493
4,459
4,964
225
195
2,955
2,920
178
178
Distribution incl. administrative costs charged
32,211
36,750
Royalties to be distributed at the end of the year
38,738
38,755
Changes in royalties to be distributed Available for distribution Distributed in the reporting year: Associations and participants Foreign organisations Central Licensing Administrative costs charged in the Netherlands Administrative costs charged abroad
The available amount to be processed for distribution in 2011 is € 1.3 million and will be added to the indivisible rights (2010: € 2.3 million, distributed in the 2011 payment).
The positive result for 2011 amounts to € 56,000 (2010: € 0.3 million). The amount available for distribution is € 0.1 million lower than in 2010. This is a decrease of 5% (€ 2.1 million negative) compare to 2009. This decrease reflects the downward trend in Stemra its royalties turnover.
Royalties will be distributed as follows: (x € 1.000)
2011
2010
10,056
10,093
5,383
5,153
To be distributed collection year
23,299
23,509
Stand per 31 december
38,738
38,755
Reservation for copyrights Reservation for double claims
Buma/Stemra
Notes to the Stemra balance sheet as at 31 December 2011
Per year of collection:
2011 Older than 2008
8,873
2008
1,928
2009
2,087
2010
2,387
2011
23,463 38,738
Available for distribution by Stemra (x € 1,000)
Royalties turnover Indivisible rights
2011
2010
32,138
35,662
1,294
2,348
56
-1,020
Became available for distribution during the year
33,488
36,990
To be distributed at the beginning of the year
38,755
40,863
Changes in royalties to be distributed
Available *
32,194
34,642
Distributed
-32,211
-36,750
38,738
38,755
2011
2010
Royalties to be distributed at the end of the year
* Excluding indivisible rights which have already been accounted for in the opening balance sheet.
Breakdown of Stemra’s turnover (x € 1,000)
12,564
16,684
Special Licensing/Private labels
6,319
6,306
Radio & TV Mechanical Rights
5,285
5,138
Mechanical Rights Online Licensing
1,835
515
Home Copy/Lending Rights
1,744
3,223
Mechanical Rights Abroad
4,391
3,796
32,138
35,662
Biem Phonomechanical Rights/Central Licensing
ANNUAL REPORT 2011
81 (11) Other liabilities (x â‚Ź 1,000)
31 December 2011
31 December 2010
Sister organisations abroad
2,603
3,063
Stemra affiliates and participants
1,103
1,555
Buma current account
389
-
Others
305
170
4,400
4,788
(12) Deferred Income (x â‚Ź 1,000)
31 December 2011 Advances to Dutch industry To be offset with industry and private labels Holiday allowance/annual leave Other liabilities and accruals
31 December 2010 *
8,913
11,355
234
263
94
102
2
335
9,243
12,055
* Adjusted for comparison purposes
Advances to Dutch industry This includes the invoiced advances on reproduction rights to be settled by the Dutch industry for periods up to the end of 2011. When the settlements are received from these producers, the advances are deducted from the royalties to be received.
Buma/Stemra
Notes to the Stemra balance sheet as at 31 December 2011
Off-balance sheet commitments
Related parties
Partially pledged bond portfolio
Related parties of Stemra Foundation are distinguished in: Buma Association and the statutory board and the board members of the Buma Association and Stemra Foundation.
In accordance with the decision of the Board, at the end of 2002, part of the bond portfolio of Stichting Buma/Stemra Obligatiefonds amounting to € 27.8 million was pledged as security to ING Bank N.V. in connection with a cash facility needed for normal operations. The cash facility is € 25.0 million. This facility was not used in 2011.
More information about board members their remuneration can be found in note 14. Regular transactions under the exploitation of copyrights to board members or to board members their related parties are not explicitly explained in the financial statements.
Long term financial liabilities The financial liability with regard to the business accommodation in Hoofddorp was prolonged until 31 December 2017. The rental obligation is incurred by Buma. The combined annual rent for Buma/Stemra amounts to € 1.3 million, of which 40% is charged to third parties. The rest is divided between Buma and Stemra on the basis of 75% / 25%. In the current composition, the annual amount for the leasing of cars by Buma/Stemra is € 0.2 million. The liability for terms longer than one year is € 0.4 million. The financial liability for the rent of the printers was entered until 1 May 2013. The annual rent amounts to € 0.1 million. The obligations with respect to the car lease and the printers are incurred by Buma. The lease costs will be for 75% on the account of Buma and for 25% on the account of Stemra. Buma/Stemra entered into a contract allowing Accenture to perform a large portion of Buma/Stemra’s back office activities from 2007 until 31 March 2017. The resulting financial liability amounts to € 15.3 million for the remaining duration of the contract, assuming consistent volumes. The costs of the back office activities are divided on a 75% respectively 25% proportion for Buma and Stemra. The off-balance sheet commitments of € 20.8 million can be summarised as follows: • less than 1 year: • between 1 and 5 years: • longer than 5 years:
ANNUAL REPORT 2011
€ 4.5 million € 14.5 million € 1.8 million
Buma Association charges personnel, accommodation and overhead costs on to Stemra Foundation. The charged on to costs for 2011 amount to € 4,328,000. The charging on to is based on cost price.
83
Notes to the Stemra profit and loss account for the year ended 31 december 2011 (13) Budget Below both the budgets for 2011 as 2012 are presented. The real figures for 2011 are incorporated for comparison. The standard return was not taken into account in the budgets 2011 and 2012. The budget from ordinary activities for 2012 is € 1.1 million negative compared to € 0.2 million negative in 2011. This decline is due to a lower budgeted administration costs charged.
Also, both the budgeted revenue distribution 2012 and 2011 is shown, included the actual turnover of 2011 for comparison. The decrease in the budget 2012 compared to the budget 2011 is particularly attributable to an expected increase in the categories Phono-mechanical rights Biem/Central licensing, which is the downward trend of the past years. For a further explanation of the budget we refer to the director’s report
Budget 2012
Realisation 2011
Budget 2011
Income Administrative costs charged Entrance fees and annual allowances Other income
3,000
3,134
3,910
600
617
546
-
50
-
3,600
3,801
4,456
Expenses 3,360
3,251
3,280
Office and accommodation costs
450
479
496
Depreciation and amortisation expenses
150
134
140
2,155
1,833
2,175
Personnel expenses
Other expenses
Operating result Interest and dividends Standard return¹ Financial result Result on ordinary activities
6,115
5,697
6,091
-2,515
-1,896
-1,635
1,372
1,444
-
1,482
508
-
1,372
1,952
1,482
-1,143
56
-153
¹ The standard return consists of exchange results. Exchange results are not accounted for in the budget.
Buma/Stemra
Notes to the Stemra profit and loss account for the year ended 31 december 2011
Breakdown of Stemra’s turnover (x € 1,000)
Budget 2012
Realisation 2011
Budget 2011
Biem Phonomechanical Rights/Central Licensing
10,500
12,564
14,150
Special Licensing/Private labels
6,750
6,319
5,875
Radio & TV Mechanical Rights
4,800
5,285
5,161
Mechanical Rights Online Licensing
1,700
1,835
1,101
250
1,744
3,630
Home Copy/Lending Rights Mechanical Rights Abroad
3,500
4,391
4,000
27,500
32,138
33,917
2011
2010
Expenses (14) Personnel expenses (x € 1,000)
Salaries
836
826
Social security contributions
125
119
Pension contributions Other personnel expenses
Charged/compensated to third parties
The combined costs of Vereniging Buma and Stichting Stemra are divided in the ratio 75% / 25%. Directly attributable costs are 100% accounted for in the entity’s financial statements.
ANNUAL REPORT 2011
79
78
117
72
1,159
1,095
2,094
3,923
3,251
5,018
The average number of employees during the reporting year was 22 employees (2010: 22 employees), which correspond to an average of 18 FTE (2010: 20 FTE). This amount does not includes employees charged on via Buma.
85 The work force (average number of FTE) can be divided into various categories of staff:
General Affairs
4
Front Office
9
Back Office
5 18
Salary Stemra Board and statutory executive director Buma/Stemra for the year 2011 (x € 1.000)
Stemra Board Fee for 12 members of the Stemra Board (incl. expense allowance)
77
H.W. van der Ree
C. van Rij
Executive director
Legal Affairs director
100%
100%
Indefinite duration
Indefinite duration
1/1 - 31/12
1/1 - 1/11
304
207
52.5
15
3
3
Statutory directors Buma/Stemra Function Full Time Equivalent Type of contract Contract in 2011
Fixed remunerations and fees Variable remunerations and fees Expense allowance
53
23
Social security costs
8
8
Termination payments
-
Pension charges
700¹
¹ The termination payment is based on the clauses in the labour contract regarding the so-called ‘Kantonrechtersformule’ (County judge formula).
The salary of the statutory directors Buma/Stemra is for 75% recognised in the financial statements of Vereniging Buma en 25% in Stichting Stemra. Buma/Stemra
Notes to the Stemra profit and loss account for the year ended 31 december 2011
(15) Other expenses (x â‚Ź 1.000)
2011 Rent, Lease & Maintenance Contributions
2010
2
1
160
168
Consulting
1
-
Other overhead
4
4
167
173
1,666
2,118
1,833
2,291
Charged on by Buma
(16) Audit fees The following KPMG Accountants fees are charged on to the Stemra account. This is according to article 2:382a BW (x â‚Ź 1.000).
2011 Other
Total
KPMG Accountants N.V.
KPMG network
KPMG network
61
-
61
Other audit assignments
-
2
2
Tax consultancy
-
19
19
Financial statements audit
Other non-audit services
-
8
8
61
29
90
2010 Other
Total
KPMG Accountants N.V.
KPMG network
KPMG network
61
-
61
Other audit services
-
5
5
Consultancy on tax issues
-
17
17
-
10
10
61
32
93
Examination of the Financial Statement
Other non-audit services
ANNUAL REPORT 2011
87 (17) Financial result (x € 1,000)
2011
2010
Interest income and other income Fixed income securities Interest received on bonds
663
923
Shares Share dividend received
833
2,019
1,496
2,942
508
1,719
-
650
100
219
2,104
5,530
-152
-709
1,952
4,821
Mutations revaluation reserve Withdrawals from revaluation reserve for the benefit of the financial result at a standard return Withdrawals from revaluation reserve allocated to financial result Other interest income and similar income Total income from investments Interest expenses and other costs
Stemra its financial result decreased to € 2.0 million in 2011. This 58% decrease is largely due to the economic recession, but was enforced due to the adjustment in the distribution of the financial result of BSO / BSA, between Buma and Stemra compared to (2011: 79.9% / 20.1%; 2010: 63.5% / 36.5%). This decrease of 16.4% is due to a sell of parti cipation by Stemra to Buma worth € 69.5 million. This consisted of the redemption of a loan in current accounts from Buma to Stemra worth € 55.7 million, a clearance of € 13.3 million from BSA/BSO and an expansion of liquid means of Stemra by € 0.5 million.
The adjusted distribution had an impact on the standard return, which decreased with € 1.2 million. The received interest and dividend decreased with respectively € 0.2 million and € 1.2 million.
Buma/Stemra
Notes to the Stemra profit and loss account for the year ended 31 december 2011
Stemra board
Mr L.A.J.M. de Wit Mr R.D. van Vliet Mr mr. E. Boom
Chairman a.i. Vice-Chairman Secretary
Mr Drs. L.J. Deuss
Board Member
Mr J.M.F. Everling
Board Member
Mr J.H. Grevelt
Board Member
Mr J.N. Hamburg
Board Member
Mr A.J. Kraamer
Board Member
Mr A.L.L. de Raaff
Board Member
Mr drs. N.M. Walboomers
Board Member
Mr drs. H.O. Westbroek
Board Member
Director
Mr H.G. van der Ree
Amstelveen, 4 april 2012
ANNUAL REPORT 2011
Statutory Executive Director
89
Other information
To: The Board and the general meeting of Stichting Stemra
Independent auditor’s report We have audited the accompanying financial statements 2011 set out on pages on pages 67 to 89 of Stichting Stemra, Amstelveen, which comprise the balance sheet as at 31 December 2011 and the profit and loss account for the year then ended and the notes, comprising a summary of the accounting policies and other explanatory information.
The board’s responsibility The board of the Foundation is responsible for the preparation of the financial statements in accordance with the accounting policies selected and disclosed by the Foundation, as set out in notes to the financial statements. Furthermore, the board is responsible for such internal control as it determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. This requires that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements,
whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the board, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion In our opinion, the financial statements are prepared, in all material respects, in accordance with the accounting policies selected and disclosed by the Foundation, as set out in notes to the financial statements.
Basis of accounting and restriction on distribution and use We draw attention to notes to the financial statements, which describes the basis of accounting. The accounting policies used are selected and disclosed by the Foundation. Our opinion is not qualified in this respect. Amstelveen, 4 April 2012
KPMG Accountants N.V. R.J. Groot RA
Profit appropriation
Proposal of the board of directors
For Stemra, the result for 2011 will be deducted from the royalties still to be distributed.
As shown in the financial statements, which we prepared in accordance with Article 26 note 2 of the Articles of Association, the board of directors proposes to add € 0.1 million of the positive result to the royalties to be distributed and allocating.
Based on an assessment of the reserve, it will be determined to what extent funds will have to be added to or deducted from the reserves. This movement will also be credited or charged to the royalties to be distributed.
The proposal has already been incorporated in the 2011 financial statements.
Buma/Stemra
Gers Pardoel Photo Ben Houdijk
Composition of the Board and the board of directors
Composition of the Board and the board of directors A.J.H. van Berkel
mr. E. Boom
Publisher
Secretary / Author
H.G. van der Ree
M.A. Bremer
mr. drs. L.J. Deuss
Chairman of the Board of Directors
Publisher
Publisher
drs. W.J. Ketellapper
P.M. van Brugge
J.M.F. Everling
Director General Affairs
Composer media music
Author
mr J.G.M. Kroeze
H.C.M. de Clercq
J.H. Grevelt
General Counsel
Composer serious music
Author
L.A. Dikker
J.N. Hamburg
Composer media music
Author
M.W. Mensink
mr. H. Kosterman
Publisher
Author
mr L.A.J.M. de Wit
T.J.M. Peters
A.J. Kraamer
Chairman a.i.
Composer / Lyricist light music
Author
drs. H.O. Westbroek
A.L.L. de Raaff
Composer / Lyricist light music
Publisher
Directors of Buma/Stemra
mr. H.J.W. Eijkelenboom Secretary of the Board of Directors
As per April 1, 2012
Board of Buma
mr. H. Kosterman Vice-chairman - Composer / Lyricist light music
A.L.L. de Raaff
drs. N.M. Walboomers
Secretary - Publisher
Publisher
Board of Stemra drs. H.O. Westbroek drs. S.A.A. Abdoelbasier
mr L.A.J.M. de Wit
Composer / Lyricist light music
Chairman a.i.
J.A. van Bergen
R.D. van Vliet
Lyricist
Vice-chairman / Publisher
ANNUAL REPORT 2011
Composer / Lyricist light music
Vacancy per 1-1-2012 Author
93 STATUTORY PROVISIONS OF THE BOARD AND THE BOARD OF DIRECTORS The current statutory provisions regarding the Board and the board of directors is as follows: The board of Buma consists of twelve or thirteen people. Twelve persons are appointed from and by the members. A thirteenth independent person can be appointed by the Board as an independent Chairman (amendment in the General Assembly of 23 May 2011). The Board consists of: A. eight members who are an author as referred to as in Article 2, sub d, of whom: • four composers/lyricists light music; • two composers of serious music; • one lyricist;
The Board of Stemra consists of twelve or thirteen people. Twelve persons are appointed from the participants. A thirteenth independent person can be appointed by the Board as an independent Chairman (amendment in the General Assembly of 23 May 2011). The Board consists of:
or authors who are participants of a participating company, who are chosen by the participating authors; B. Four (4) persons who are a participating publisher or who possess a management position at a participating publishing company, and who are chosen by the participating publishing companies; C. One (1) person who is named by Buma;
C. Optional: one independent Chairman to be named by the Board.
The full statutory provisions on the Board are contained in Articles 13 to 20 of the Statute of Buma and Stemra.
A. Seven (7) authors who are participants
• one composer media music;
B. four members who are publicists as referred to as in Article 8, paragraph 1, or who are in a management position at a publishing company, as referred to as in Article 9, paragraph 1.
The board of directors of Buma and Stemra consist of one or more people, who are not a member/participant or an affiliate of the Association or the Foundation.
D. An eighth (8) author if an independent person is named by the Board as independent Chairman. This author is a participant or is an author of a participating company, chosen by the participating authors.
The full statutory provisions on the board of directors are contained in Articles 21 to 23 of the Statute of Buma and Stemra.
Board profile The profile of the Board is based on “what the board needs to function well”, considering and taking into account aspects like: • The type of organisation; • The development phase of the organisation; • The restructuring of governance. The composition of the Board should be generally in line with the contemporary governance standards and codes of conduct. For the full profile of the Board we would like to refer to the Buma Stemra website.
Additional jobs statutory directors H.G. van der Ree; Chief Executive Officer Buma/Stemra as per 1 May 2010 • Statutory Chairman of the board of directors Stichting Buma/Stemra Aandelenfonds • Statutory Chairman of the board of directors Stichting Buma/Stemra Obligatiefonds • Member of the board Stichting Buma/Stemra Deelneming • Secretary/treasurer Stichting SCAN
• Member of the board Stichting Brein • Secretary Stichting Buma Cultuur • Vice chairman Vereniging VOICE • Member of the board Stichting Beheer Rechten
Fingerprinting Database • Member of the board Stichting Amsterdam Dance Event
Buma/Stemra
Composition of the Board and the board of directors
List of additional positions of members of the board of Buma as per 1 April 2012 Drs. S.A.A. Abdoelbasier
• Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Composer/lyricist light music • E mployed at Royal Bank of Scotland • Chairman Stichting Consent • Commissioner and shareholder • • • •
of Financial Street VOF Commissioner and shareholder of Beaubury Trading Street VOF Member of the board Palm Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
• M ember of the board Vereniging Palm • Treasurer GONG • Treasurer STOMP (independent record label NVPI)
H.C.M. de Clercq Composer serious music • F reelance composer • F reelance filmmaker (directing, camera, editing) • Member of the board BSA
• Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
• Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
(Stichting Buma/Stemra Aandelenfonds)
• Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
A.L.L. de Raaff Publisher • Managing Director and majority shareholder
L.A. Dikker J.A. van Bergen Lyricist • Freelance Author for theatre, tv, film, • • • • •
radio, song, print and advertising In partnership Van Bergen and Storimans/ Authors, Hoorn Advisor Music Theatre Fonds Podium Kunsten Secretary/director Stichting Paul van Vliet Academie Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Composer media music • Member of the board DZKA, the participants association
• C hairman MiMM, Music Institute Multimedia • Member of the board FFACE, Federation of Film- and Audiovisual Composers of Europe
•
(publisher without publishing titles) • Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) • Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Drs. H.O. Westbroek
Chappell Music Holland BV.
• Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
• Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
M.A. Bremer
Chairman of Palm anager Platform Makers M Secretary of Sena Member of the board Stemra Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) • Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
M.W. Mensink
Mr. L.A.J.M. de Wit
Composer/lyricist light music • • • • •
Publisher • Managing Director Universal Music Publishing Benelux
• Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) • Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
P.M. van Brugge
Publisher • D irector Strengholt B.V. • Managing Director and majority shareholder VOC B.V. • Treasurer Vereniging Muziekhandelaren en – uitgevers van Nederland • Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) • Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Composer media music • F reelance composer • S enior lecturer composition at Codarts • • • •
Hogeschool voor de Kunsten Rotterdam Freelance executive musician and conductor Member of the board of the association Dutchfilmcomposers.nl Member of the board Quercus Music Foundation Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
ANNUAL REPORT 2011
Composer/lyricist light music • • • •
Copywriter Performing artist Columnist Radio- and tv presenter at radio Veronica, respectively RTV Utrecht • Joint manager Café-Restaurant ‘Stairway to Heaven’ • Member of the board Stemra • Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) • Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Kosterman
• Managing Director Warner/
• •
• Dikker & Courbois B.V.
A.J.H. van Berkel Publisher
• •
of entertainment company CTM B.V., including the Music publisher CP Masters B.V. and Imagem CV Chairman Nederlandse Muziek Uitgevers Vereniging Production Harpengala Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
T.J.M. Peters Composer/lyricist light music • • • • • •
reelance composer / lyricist F Freelance music producer Music publisher Owner/Managing Director NRGY Music BV Partner BOEP B.V. (digital music distributor) Member of the board Sena (sector Performers)
Chairman of the board Buma/ Stemra a.i. • Deputy judge criminal law, court of law Rotterdam
• Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
• Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
95 List of additional positions of members of the board of Stemra as per 1 April 2012 Mr E. Boom
J.N. Hamburg
Author • C omposer/Copywriter • Musician • Managing Director and majority shareholder Number One Music Holland BV, music publisher
• Member of the board;-secretary Stichting Sociaal • • • • •
Fonds Buma Member of the board; secretary Vereniging PALM Member of the board occupational pension fund Stichting AENA Teacher Johan Alsbach Stichting, College for Music publishers Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Mr. drs. L.J. Deuss Publisher • • • • • • • • • • • • • •
irector Albersen Verhuur B.V. and Deuss Holding B.V. D Chairman of the board Leo Smit Stichting Chairman Stichting Output/Amsterdam Electric Vice-chairman of the board VMN (Vereniging of Music traders and - publishers in Nederland) Member of the board/treasurer Stichting Nederlands Muziek Instituut Member of the board Stichting Sociaal Fonds Buma Member of the board WECOLEDO Member of the board Reprorecht Member Serious Music Bureau, ICMP Honarary member International Association of Music Information Centres Advisor Cultural projects of the city The Hague Freelance teacher Artez Conservatorium Arnhem Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Author • C omposer • Director and joint owner of Hamburg Music and • • • • •
FutureClassicsMusic (publisher) Chairman of Genootschap Nederlandse Componisten Chairman of Stichting GeNeCo Chairman of Paula Lindberg-Salomon Stichting Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Mr. H. Kosterman Author • • • • •
Chairman of PALM ember of the board Platform Makers M Secretary of Sena Vice-chairman Buma Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) • Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
SOB Audio Imaging Haramitsu Holding • Member of the board BCMM • Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) • Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
A.J. Kraamer Author • Musician, composer, lyricist, performing artist, producer, publisher, conductor, arranger, technician
• Owner/Director NEW B.V. (New Efficient
• • • • •
Wholesale B.V.), TED B.V. (The Electronic Designers), AKM B.V. (Ad Kraamer Music B.V.) Chairman HTR ( Stichting Heusdense TV & Radio station ) Member of the board Vereniging PALM Member of the board GONG (Genootschap Onafhankelijke Nederlandse Geluidsproducers) Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
A.A.L. de Raaff
• O wner HSG Music • Treasurer Vereniging PALM • Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) • Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
The Right Track Music
• Managing Director and majority shareholder personal holding RVV MUSIC B.V.
• Managing Director and majority shareholder Hot Streak Music B.V.
• M ember of the board Buma Cultuur • Vice chairman Nederlandse Muziek Uitgevers • Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
• Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Drs. N.M. Walboomers Publisher • M anaging Director/ATV Music Publishing B.V. • Managing Director/ATV Music Publishing (Holding) B.V.
Publisher
(Belgium) B.V.
• M anaging Director Bad Boys Production Music B.V. • Managing Director Double T Publishing B.V.B.A. • Managing Director Edition Musicales Unlce Dan B.V.B.A.
• Managing Director and majority shareholder of Nelis Holding B.V.
• Managing Director and majority shareholder of Walboomers Publishing B.V.
• Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
• Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Drs. H.O. Westbroek Author • • • •
• Managing Director and majority shareholder
• • • •
of entertainment company CTM B.V. including Music Publishing CP Masters B.V. and Imagem CV Chairman Nederlandse Muziek UItgevers Vereniging Production Harpengala Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
J.H. Grevelt Author
Napith LTD (USA)
• Managing Director and majority shareholder
• Managing Director/ATV Music Publishing
• Managing Director and majority shareholder • Managing Director and majority shareholder
Dance Foundation B.V.
• Managing Director and majority shareholder
Vereniging
J.M.F. Everling Author
Chrysalis Songs Benelux
• Managing Director and majority shareholder
• • • •
Copywriter erforming artist P Columnist Radio- and tv presenter at radio Veronica (respectively RTV Utrecht) Joint manager Café-restaurant ‘Stairway to Heaven’ Member of the board Buma Member of the board BSA (Stichting Buma/Stemra Aandelenfonds) Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
Mr. L.A.J.M. de Wit R.D. van Vliet Publisher • Managing Director and majority shareholder of Cloud 9 Music B.V.
• Managing Director and majority shareholder of Cloud 9 Dance B.V.
Chairman of the board Buma/Stemra a.i. • D eputy judge criminal law, court of law Rotterdam • Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
• Member of the board BSO (Stichting Buma/Stemra Obligatiefonds)
• Managing Director and majority shareholder
Buma/Stemra
Colophon
Address Vereniging Buma/Stichting Stemra Siriusdreef 22-28 2132 WT Hoofddorp Tel. +31 (0)23 799 79 99 Fax +31 (0)23 799 77 77 info@bumastemra.nl www.bumastemra.nl
as the Dutch version constitutes the sole official document.
Photo Cover
Typographical and printing errors reserve. All amounts quoted in this annual report are in euros.
Photo: All Access Entertainment
Thé Lau and Lange Frans perform ‘Zing Voor Me’
Photos back cover from top to bottom Afrojack
Chief editor
Photo: Mike Breeuwer
Frank Helmink, Buma/Stemra Office The Hague Lange Voorhout 86-12 2514 EJ Den Haag Tel. +31 (0)70 310 91 09 Fax +31 (0)70 310 91 00 denhaag@buma.nl Disclaimer This report has been translated into English solely for the convenience of the inter national reader. In the event of conflict or inconsistency between the terms used in the Dutch version of the report and the English version, the Dutch version shall prevail,
Glennis Grace
Text
Photo: All Access Entertainment
Erik de Boer, Boardroom Financial PR
Roel van Velzen Photo: All Access Entertainment
Editor Annemarieke Noordhoff, JCM Context
Nick en Simon
Concept & design
Alain Clark
Link Design, Amsterdam
Photo: All Access Entertainment
Printing W.C. Den Ouden bv, Amsterdam
Photo: All Access Entertainment
Jan Smit Photo All Access Entertainment
Some of the most-talked about composers/ lyricists in 2011