Chartered Institute of Public Relations Financial statements for the year ended 31 December 2009
Chartered Institute of Public Relations Contents
Page Administrative and reference information
1-3
Corporate governance statement
4-5
Financial review
6
Auditors' report
7
Revenue account
8
Balance sheet
9
Cash flow statement
10
Notes to the financial statements
11 - 17
Chartered Institute of Public Relations Administrative and reference information 2009 Officers: President President Elect Treasurer Immediate Past President
Kevin Taylor Jay O’Connor Sally Sykes Elisabeth Lewis-Jones
Director General Deputy Director General
Colin Farrington Ann Mealor
2009 Council: Miti Matt Carol Andrew Kevin Tom Caraline John Rob Sarah Debbie Maire Caroline David Jane Gill Paul Helen Mark Jonathan Pat Anne Sarah Anthony Keith Sally Edmund Quentin
Ampoma Appleby Arthur Bartlett Bentley Bowden‐Green Brown Brown Brown Burton Byers Campbell Cecil Crundwell Cumming Dandy Davison Dickinson Douglas French Gaudin Gregory Hall Henderson Johnston Keith King Langley
Emma Elisabeth Jason Scott Elizabeth Pamela Paul Jay Sarah Deborah Peter Jacqueline David Lisa Alan Katherine Jenifer Barbara Sally Kevin Imelda Gillian Adrian Ashley Justin Sue Paul
Leech Lewis‐Jones MacKenzie McKenzie Male Mounter Mylrea O'Connor Pinch Powton Prowse Purcell Sanders Shaddick Smith Stedman Stirton Stopher Sykes Taylor Topping Waddell Wheeler Wilcox Wilkes Wolstenholme Wynne
The following were members of Council at the start of 2009 and were replaced when their term of office expired. Alex Elisabeth Mike Bronwen Wynford Marie Stephen Mike Dennis Robert Caroline Deborah
Aiken Anderson Browne Eames Emanuel Ennis Jolly Kean Kelly Khan Kinsey Leah
Carol Conall Justin John Melissa Mani Lee Robin Garry Susan Ipek Lionel
Matthews McDevitt McKeown De Mierre Page Pillai Smith Treacher White Wilcock Yigit Zetter
Page 1
Chartered Institute of Public Relations Administrative and Reference information (continued) Standing committees and representatives as at 31 December 2009 Business Services and Revenues Jenifer Stirton Chair Rob Brown Helen Dickinson Mark Douglas Jonathan French Sally Sykes Membership Lisa Shaddick John Brown Matt Appleby Carol Arthur Tom Bowden-Green David Crundwell David Sanders Imelda Topping
Chair Vice Chair
Education and Professional Standards Paul Mylrea Chair Sue Wolstenholme Co-Opted Vice Chair Miti Ampoma Debbie Byers Gill Dandy Pat Gaudin Emma Leech Sarah Pinch Jacqueline Purcell Barbara Stopher Professional Practices Committee Adrian Wheeler Chair Jane Cumming Anne Gregory Rhodri Harries Co-Opted Jane Howard Co-Opted Edmund King Quentin Langley Barry Leggetter Co-Opted Pamela Mounter Deborah Powton Peter Prowse Alan Smith Claire Walker Co-Opted Paul Wynne Disciplinary Committee Jon Aarons June Beedham Ken Cook Alan Dadd Chris Genasi Janet Hildreth Rosemary Inge Elisabeth Lewis-Jones Lord Laird of Artigarvan Harvey Thomas Sam Warnock Ian Wright Lionel Zetter Page 2
Chartered Institute of Public Relations Administrative and Reference information (continued)
Finance Committee Sally Sykes Kevin Taylor Jay O’Connor Elisabeth Lewis-Jones John Brown Remuneration Committee Alison Clarke Elisabeth Lewis-Jones Jay O’Connor John Brown Sally Sykes Kevin Taylor
Chair/Treasurer President President Elect Immediate Past President
Chair Past President
Executive Board (throughout 2009): Kevin Taylor President Elisabeth Lewis-Jones Past President Sally Sykes Treasurer Jay O'Connor President Elect John Brown David Crundwell Jonathan French Sarah Hall Paul Mylrea Lisa Shaddick Jenifer Stirton Adrian Wheeler Sue Wolstenholme Director General Acting Director General
Colin Farrington Ann Mealor
Solicitors Camerons Solicitors LLP 70 Wimpole Street, London W1G 8AX Auditor Chantrey Vellacott DFK LLP Russell Square House 10/12 Russell Square London WC1B 5LF Bankers Nat West Bank Plc 134 Aldersgate Street London, EC1A 4LD Institute Address
CIPR Public Relations Centre 52-53 Russell Square London, WC1B 4HP
Website
www.cipr.co.uk
Notice of Annual General Meeting The Annual General Meeting of the Chartered Institute of Public Relations will take place at 6pm on Tuesday 15 June 2010 at CIPR Public Relations Centre, 52-53 Russell Square, London WC1B 4HP. All CIPR members are invited. An Agenda will be placed on the CIPR website by 28 May 2010 Page 3
Ann Mealor, Acting Director General 26 April 2010
Chartered Institute of Public Relations Corporate governance statement Corporate Governance The Council The Council is the governing body of the CIPR. Ultimately all acts undertaken by the officers and staff are in the name of, and with the authority of, the Council. The Council meets three to four times a year and focuses on overall strategy and co-ordination. Day to day responsibility is delegated to the CIPR Executive Board and Standing Committees. The Executive Board The day-to-day operations of the Chartered Institute are supervised by the Board. This is chaired by the President and consists of the elected officers (Immediate Past President; President; President-elect and Treasurer); the DirectorGeneral, Deputy Director General and other elected members of the Council, including the Chairs of the four Standing Committees. The Board works with the Director General to ensure the co-ordination of Institute business. Standing Committees may refer matters to the Board for guidance and direction. The Board meets approximately eight times a year. Standing Committees There were six ‘Standing Committees’ in 2009: Membership; Professional Practices; Education and Professional Standards; Business Services and Revenue; Finance; Remuneration. A Disciplinary Committee which does not include members of the Council meets as necessary to consider references to it by the Professional Practices Committee. A Qualifications Awarding Body, which includes some Council members, is separately constituted. Committee roles are as follows:
Membership: admission policy; recruitment; member benefits and services.
Professional Practices: policy and ethical issues affecting Institute members; complaints against members.
Education and Professional Standards: education and training policy and implementation.
Business Services & Revenue: overseeing the development of trading functions including conferences and publications.
Finance: financial and budgetary policy.
Remuneration: salary and terms and conditions of senior staff.
Financial responsibilities of the Council The Council is responsible for preparing the financial statements in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice Bye-law 38 requires the Council to prepare financial statements for each financial year which give a true and fair view of the state of the affairs of the Institute and of the surplus or deficit of the Institute for that year. In preparing these the Council is required to: - select suitable accounting policies and apply them consistently; - make judgements and estimates that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Institute will continue in business. The Council is responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Institute. It is also responsible for safeguarding the assets of the Institute and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Page 4
Chartered Institute of Public Relations Corporate governance statement (continued)
Financial responsibilities of the Council (continued) The Council must, in determining how amounts are presented within items in the revenue account and balance sheet, have regard to the substance of the reported transaction or arrangement, in accordance with generally accepted accounting principles and practice. The Council is responsible for the maintenance and integrity of the corporate and financial information included on the Institute’s website.
Legislation in the United Kingdom governing the preparation and dissemination of the financial
statements and other information included in annual reports may differ from legislation in other jurisdictions.
Page 5
Chartered Institute of Public Relations Financial review
2009 was a difficult year for the Institute. We suffered exceptional property-related relocation costs and our trading saw a downturn in the autumn. However, our membership subscriptions held up well as did our Excellence Awards programme, both showing growth on the previous year. Our loss – of £580k – is substantial. However, it is less than the originally anticipated £700k due to swift action to cut costs. Reductions were made to staff salaries and pensions, and activities that were not a priority were cut. The results of these actions will be seen in 2010 in lower costs and further benefit should follow through to 2011. I am grateful for the efforts of everyone who helped us achieve these savings while we continued to invest in and maintain our services to members. At the heart of this loss are the property costs around our move from St James’s Square to Russell Square. The circumstances around our move, including Serious Fraud Office investigations into our previous landlord who gave us notice to quit, have been widely reported. However, the move left us with £308k of exceptional costs and we faced a further £205k of rent payments due to overlapping occupancy. This is why our ‘premises expenses’ are higher than last year. Although we enjoyed a 14 month rent free period on Russell Square, our accounts need to show our future rental obligations. This is why the entry for ‘creditors’ is higher than last year. On the positive side, as a result of the rent free period our cash flow remained strong throughout 2009 and continues to remain so. We now have, in Russell Square, a building that is accessible, fit for purpose and will allow us to expand our training and qualifications programmes when the market is right. The newly established CIPR Centre for Learning, which delivers our qualifications out of Russell Square, has proved to be very successful and is becoming increasingly popular with students. We are determined to make our building work hard for us and are already sharing some of our space with the British Promotion and Merchandise Association. The other reason for our loss was a downturn in key activity areas such as qualifications and training due to the recession. However, as we enter this new year, early indications are that trading conditions have improved. We have our 2010-2012 Strategic Plan in place, costs are being closely monitored and we are reviewing the structure of our organisation in order to ensure it best fits the needs of our members and the profession. We are streamlining processes and ensuring efficient operations are in order to deliver our 2010 plan to budget. Membership remains buoyant. Our goal is to produce a surplus for this year in order to build up our reserves. Colin Farrington, Director General left the CIPR after 11 years at the end of March 2010. I was appointed Acting Director General by the Board in June 2009. I would like to thank my CIPR colleagues and Executive Board members for their commitment and support in reshaping the Institute to face the challenges ahead.
Ann Mealor FCIPR Acting Director General
26 April 2010
Page 6
Chartered Institute of Public Relations Independent auditor’s report to the members of Chartered Institute of Public Relations We have audited the financial statements of Chartered Institute of Public Relations (Institute) for the year ended 31 December 2009 which comprise the revenue account, the statement of total recognised gains and losses, the balance sheet, cash flow statement and the related notes. These financial statements have been prepared in accordance with the accounting policies set out therein. This report is made solely to the Institute's members, as a body. Our audit work has been undertaken so that we might state to the Institute's members those matters we are required to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Institute and the Institute's members as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of the council and the auditor As described in the statement of financial responsibilities of the Council the Institute's Council is responsible for the preparation of the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland). We report to you our opinion as to whether the financial statements give a true and fair view and have been properly prepared in accordance with appropriate accounting standards. We also report to you if, in our opinion, the Institute has not kept proper accounting records, if we have not received all the information and explanations we require for our audit, or if information regarding the Council’s remuneration and transactions with the Institute is not disclosed. We read other information contained in the Financial Statements and consider whether it is consistent with the audited financial statements. This other information comprises only the corporate governance statement and the financial review. We consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the financial statements. Our responsibilities do not extend to any other information. Basis of audit opinion We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the Council in the preparation of the financial statements, and of whether the accounting policies are appropriate to the Institute’s circumstances, consistently applied and adequately disclosed. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. Opinion In our opinion the financial statements give a true and fair view, in accordance with United Kingdom Generally Accepted Accounting Practice, of the state of Institute’s affairs as at 31 December 2009 and of its deficit for the year ended 31 December 2009.
Chantrey Vellacott DFK LLP Chartered Accountants and Statutory Auditor London 26 April 2010
Page 7
Chartered Institute of Public Relations Revenue account for the year ended 31 December 2009
Income
2009
2008 As restated
Notes
£
£
2
4,432,366
4,775,494
2
(1,501,372) _________ 2,930,994
(1,849,087) _________ 2,926,407
(221,850)
(292,913) (2,826,841)
Direct costs Gross surplus Operational costs Administrative expenses
5
(3,094,385)
Exceptional costs
3
(307,849)
3
113,349 _________ (579,741)
Other operating income Operating deficit
123,455 _________ (69,892)
Other interest receivable and similar income
2,489
Interest payable on finance leases Deficit on ordinary activities before taxation Tax on deficit on ordinary activities
6
Retained deficit for the year
34,502
(2,709) _ ______ (579,961)
_______ (35,390)
_ ______ (579,961) __ _____
414 _______ (34,976) _______
Statement of Recognised Gains and Losses for the year ended 31 December 2009 2009
2008 As restated
£ Loss for the financial year
(579,961) ________
Total losses for the year
(579,961)
Prior year adjustment
14
Total losses recognised since last annual report
78,089 _ ______ (501,872) __ _____
The notes on pages 11 to 17 form an integral part of these financial statements. Page 8
£ (34,976) _______ (34,976) _______
Chartered Institute of Public Relations Balance sheet as at 31 December 2009 2008 As restated
2009 Notes
£
£
£
£
Fixed assets Tangible assets
7
193,924
293,928
Current assets Stocks Debtors
18,642
5,978
479,423
797,336
528,265 ___ _ ___ 1,026,330
309,688 ___ ____ 1,113,002
8
Cash at bank and in hand
Creditors: amounts falling due within one year
10
_
(630,824) ___ ____
(820,411) ______
Net current assets
205,919
482,178
232,500
232,500
__ _____
_______
732,347
908,602
Debtors: amounts falling due after more than one year
9
Total assets less current liabilities
Creditors: amounts falling due after more than one year Deferred income
11
(376,331)
12
(521,941)
Net liabilities Reserves
(494,566)
_ ______
_______
(165,925) _ ______
414,036 _______
(431,990)
167,695
13
Revenue account National, regional and sectoral groups balances
266,065 _ ______
246,341 _______
(165,925) _ ______
414,036 _______
The financial statements were approved and authorised for issue by the Council and were signed on its behalf on 26 April 2010. Kevin Taylor
Sally Sykes
President 2009
Treasurer 2009
The notes on pages 11 to 17 form an integral part of these financial statements. Page 9
Chartered Institute of Public Relations Cash flow statement for the year ended 31 December 2009 2009 £ Net cash inflow/(outflow) from operating activities Returns on investments and servicing of finance: Interest received Interest paid – interest element of finance lease payments
£
£
2008
£
(155,236)
336,628 34,502
2,489
-
(2,709) (220)
Taxation
34,502 (4,250)
-
Capital expenditure and financial investment: Purchase of tangible assets
(102,828)
Financing Capital element of finance lease rental payments
(15,003)
Increase/(decrease) in cash for the year
218,577
(222,271)
Reconciliation of net cash flow to movement in net funds: Increase/(decrease) in cash for the year Cash inflow from increase in lease financing New finance leases
218,597 15,003 (97,295)
(222,271) -
Movement in net funds Net funds at 1 January 2009
136,305 309,668
(222,271) 531,939
Net funds at 31 December 2009
445,973
309,668
Analysis of Net Funds: Cash at bank and in hand Finance leases Net Funds
31 Dec 08
cash flow
(97,287) -
other non cash movement £ -
31 Dec 09
£ 309,688
£ 218,577
£ 528,265
-
15,003
(97,295)
(82,292)
309,688
233,580
(97,295)
445,973
Reconciliation of operating loss to net cash inflow from operating activities: Loss on ordinary activities before taxation Interest payable Interest receivable Depreciation charge Loss on disposal of fixed assets Increase/(decrease) in stocks Decrease/(increase) in debtors Increase in creditors Decrease in provisions Increase in deferred income Net cash inflow/(outflow) from operating activities
Page 10
(579,961) 2,709 (2,489) 94,645 5,474 (12,664) 317,913 483,626 27,375
(35,390) (34,502) 57,166 (1,930) (324,403) 159,348 (28,960) 53,435
336,628
(155,236)
Chartered Institute of Public Relations Notes to the financial statements for the year ended 31 December 2009 1. 1.1.
Accounting policies Accounting convention The financial statements are prepared under the historical cost convention and in accordance with applicable law and UK accounting standards (United Kingdom Generally Accepted Accounting Practice).
1.2.
Going concern Notwithstanding the loss for the year and the net liabilities disclosed in the balance sheet, the budget and cashflow prepared for the forthcoming year have been prepared on a basis which shows that the Institute will meet all its liabilities as they fall due. In addition, the Institute’s working capital requirements are funded by way of subscription advances which are not expected to be repaid in the normal course of business. On this basis, the Council consider it appropriate to prepare the financial statements on a going concern basis.
1.3.
National, regional and sectoral groups The Institute makes grants to national, regional and sectoral groups to fund their activities. These grants are eliminated on consolidation. The revenue account therefore recognises the revenues generated and expenditure incurred by these groups during the year from their activities, and the balance sheet recognises any residual net assets, for example cash balances, debtors less liabilities at the year end.
1.4.
Income recognition Membership subscription income is recognised in the year to which it relates. Student education and qualification income is recorded in the year courses start. Income from seminars and events is recognised upon the timing of the event and all other income is recognised upon the provision of the goods or services excluding VAT. Subscription, education, events and other income received in advance is carried forward as deferred income and included within creditors at the year end. Amounts received in advance for subscriptions are carried forward as deferred income, which have now been disclosed separately from creditors on the face of the balance sheet.
1.5.
Tangible fixed assets and depreciation Depreciation is provided at rates calculated to write off the cost less residual value of each asset over its expected useful life, as follows:
1.6.
Leasehold improvements
-
Straight line over the life of the lease
Computers Computer software
-
25% straight line 33 â…“ % straight line
Furniture and equipment
-
10%-25% straight line
Leasing Rentals payable under operating leases are charged against income on a straight line basis over the lease term taking into account the rent free period at the commencement of the lease. The rent free period equalisation creditor will be released over five years on the basis of the difference between rent charged and payments made. Assets held under finance leases are capitalised and disclosed under tangible fixed assets at their fair value. The capital element of the future payments is treated as a liability and the interest charged to the revenue account on a sum of digits basis.
1.7.
Stocks Stock comprising publications in print or production are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow moving items. Page 11
Chartered Institute of Public Relations Notes to the financial statements for the year ended 31 December 2009 1.8.
Retirement benefits The Institute operates a defined contribution pension scheme available to all qualifying employees.
The
contributions payable in providing benefits are charged in the revenue account in the year to which they relate. 1.9.
Taxation The Institute’s transactions with its members are not subject to tax. Other transactions are taxable on a basis agreed with HM Revenue & Customs.
2.
3.
Income and gross surplus analysis
2009
2008 As restated Gross surplus
Income
Gross surplus
Membership subscriptions Education and qualification Conferences, seminars and awards events Other
£ 1,487,392 1,713,374 1,114,018 117,582 _________
£ 1,487,392 985,993 413,076 44,533 _________
£ 1,423,776 1,856,810 1,356,568 138,340 _________
£ 1,423,776 1,080,613 322,952 99,066 _________
Total
4,432,366 _________
2,930,994 _________
4,775,494 _________
2,926,407 _________
Operating deficit
Income
2009 £
2008 £
Operating deficit is stated after charging: Depreciation on owned fixed assets
87,616
57,166
Depreciation on assets held under finance leases
6,849
-
Loss on disposal of tangible fixed assets
5,474
-
Auditor’s remuneration Operating lease rentals: property Finance charges on finance leases Exceptional costs – dilapidations – other including removal costs
4.
Staff costs
Salaries and wages National insurance Pension contributions
Average number of staff
17,250
16,250
564,781
302,100
2,709
-
252,863
-
54,986 _________
_________
2009
2008
£
£
1,456,096
1,465,983
149,364
150,157
150,427 _________ 1,755,887 _________
133,705 _________ 1,749,845 _________
2009
2008
No.
No.
40 ____
40 ____
The Institute operates a defined contribution pension scheme in respect of the staff. The pension charge represents contributions due from the Institute. The scheme and its assets are held and managed by independent managers.
Page 12
Chartered Institute of Public Relations Notes to the financial statements for the year ended 31 December 2009 5.
Administration costs
Staff costs Staff insurance, training and recruitment costs
2008
£
£
1,755,887
1,710,311
79,458
134,225
Premises
789,111
508,457
Office costs
114,910
123,292
Other costs
258,105
293,390
Depreciation
91,440
57,166
5,474 _________ 3,094,385 _________
_________ 2,826,841 _________
2009
2008
£
£
Loss on sale of fixed assets
6.
2009
Tax on surplus on ordinary activities (a) Analysis of the tax charge for the period Current tax UK corporation tax
-
-
Adjustments in respect of prior periods
_______ _______
(414) _______ (414) _______
(b) Factors affecting the tax charge for the period The tax assessed for the period is lower than the standard rate of corporation tax in the UK (21%) (2008: 20.75%). The differences are explained below: Loss on ordinary activities before tax
(579,961) _______
(35,390) _______
Tax on profit on ordinary activities at standard CT rate of 21% (2008: 20.75%)
(121,792)
(7,343)
33,849
(6,979)
Effects of: Net income not taxable/(net expenses not deductible) Capital allowances less than depreciation Unrelieved tax losses Adjustments in respect of previous periods
5,577
4,602
82,366
9,720
_______ _______
Current tax charge for the period (note 6(a))
(414) _______ (414) _______
Taxation is provided on the Institute's income from investment and surpluses arising from non-member sources.
Page 13
Chartered Institute of Public Relations Notes to the financial statements for the year ended 31 December 2009 7.
Tangible fixed assets
Leasehold Improvements Computers £
Computer
Furniture &
Software
equipment
Total
£
£
£
£
Cost At 1 January 2009
91,194
334,880
8,745
161,723
596,542
Additions
92,622
4,928
-
102,523
200,123
Disposals
(30,532) _______ 153,284 _______
_______ 339,808 _______
_______ 8,745 _______
(7,296) _______ 257,000 _______
(37,828) _______ 758,837 _______
21,199
290,755
-
90,664
402,618
(1,822)
(32,354)
At 31 December 2009 Depreciation At 1 January 2009 On disposals
-
-
39,990 _______ 30,657 _______
24,200 _______ 314,955 _______
2,915 _______ 2,915 _______
27,540 _______ 116,382 _______
94,645 _______ 464,909 _______
At 31 December 2009
122,627 _______
24,853 _______
5,830 _______
140,618 _______
293,928 _______
At 31 December 2008
69,995 _______
44,125 _______
8,745 _______
71,059 _______
193,924 _______
Charge for the year At 31 December 2009
(30,532)
Net book values
Finance Leases Included within the net book value of £293,928 is £70,885 (2008: £nil) relating to assets held under finance lease. The depreciation in respect of such assets amounted to £6,849 (2008; £nil). 8.
Debtors: amounts falling due within one year
2008
£
£
Trade debtors
242,592
400,161
Other debtors
171,797
230,077
61,499
166,557
3,535 _______ 479,423 _______
541 _______ 797,336 _______
Prepayments and accrued income Pension contributions
9.
2009
Debtors: amounts falling after more than one year
Prepayment: rent deposit
2009
2008
£
£
232,500 _______
232,500 _______
Long term debtors are shown separately from current assets due to their material nature and the fact that they will not be repaid within one year. This relates to the rent deposit on the Russell Square offices 10 year lease.
Page 14
Chartered Institute of Public Relations Notes to the financial statements for the year ended 31 December 2009 10.
Creditors: amounts falling due
2009
2008 As restated
within one year £
£
Trade creditors
295,640
263,998
Corporation tax
-
-
Other taxes and social security costs
56,480
47,246
Other creditors
169,302
6,440
Accruals and deferred income
236,528
313,140
Rent free period equalisation Obligations under finance leases (note 17)
31,000
-
31,461 _______ 820,411 _______
_______ 630,824 _______
2009
2008
£ 11.
£
Creditors: amounts falling due after one year Obligations under finance leases (note 17) Rent free period equalisation
50,831
-
325,500 _______ 376,331 _______
_______ _______
Obligations under finance leases are secured on the assets to which they relate. 12.
Deferred Income Deferred income represents amounts billed in advance in respect of membership subscriptions. As these sums are not expected to be repaid in the normal course of business, they have been shown separately on the face of the balance sheet. In previous years these amounts were included in creditors falling due within one year. The comparative figures have been re-stated.
13.
Reserves Institute
National, Regional & Sectoral groups
Total
£
£
89,606
246,341
335,947
At 1 January 2009 as restated
78,089 _______ 167,695
___________ 246,341
78,089 ______________ 414,036
(Deficit)/Surplus for the year
(599,685)
At 1 January 2009 as previously reported Prior year adjustment (note 14)
At 31 December 2009
19,724
£
(579,961)
_______
_______
_______
(431,990) _______
266,065 _______
(165,925) _______
Page 15
Chartered Institute of Public Relations Notes to the financial statements for the year ended 31 December 2009 14.
Prior year adjustment
Decrease in deferred subscription income
Net increase in reported profits
Total
2008
£
£
Prior years
78,089
8,646
69,443
_______
_______
_______
78,089
8,646
69,443
_______
_______
_______
£
The prior year adjustment arises due to a correction of the release of deferred subscription income paid in installments which had been incorrectly allocated in prior years. The comparative figures have been restated to reflect this change. 15.
Financial commitments At 31 December 2009 the Institute had annual commitments under non-cancellable operating leases as follows: 2009
2008
£
£
Leases of land and buildings Expiry date: Within one year More than five years
-
171,510
465,000 _______
_______
With effect from 5 January 2009 the Institute signed a 10 year lease ending on 4 January 2019 on its offices in Russell Square at an annual rent of £465,000 with a rent free period of 14 months. The first rent review date is due on 5 January 2014.
16.
Related party transactions (1)
Under the Royal Charter, Council members are not entitled to receive any fees related to their work as Council members. Council members qualified as approved trainers or acting as examiners may also receive fees on the same basis and subject to the same conditions as other CIPR members when carrying out these activities on the CIPR’s behalf. These fees amounted in aggregate to £7,676 (2008: £7,720).
(2)
Payments were also made to Ashley Public Relations a business owned by Sue Wolstenholme, Council member and Chair of the Qualifications Awarding Body, amounting to £16,265 (2008: £44,444). These were fees and expenses primarily for specialised work relating to qualifications overseas. No amounts were outstanding at the year end. The role of a Council or Board member is a voluntary position and no fees are paid related to this work.
(3)
The Council of the Institute approves the appointment of the trustees of the Chartered Institute Public Relations Benevolent Fund (Iprovision). The trustees of Iprovision have full responsibility for the decision making and operations of the Charity and accordingly the Council of CIPR do not exercise dominant influence over the affairs of Iprovision. Accordingly the Council of CIPR do not consider Iprovision to be a subsidiary undertaking and therefore have not prepared consolidated accounts. Copies of the accounts of Iprovision may be obtained by contacting CIPR Public Relations Centre 52-53 Russell Square, London WC1B 4HP.
Page 16
Chartered Institute of Public Relations Notes to the financial statements for the year ended 31 December 2009
17.
Commitments under finance leases Future commitments under finance leases are as follows: 2009 ÂŁ
2008 ÂŁ
Amounts payable within one year
35,424
-
Amounts payable between two and five years
53,136
-
_______ 88,560
_______ -
(6,268)
-
_______ 82,292 _______
_______ _______
Current obligations
31,461
-
Non-current obligations
50,831
-
_______
_______ _______
Less: interest and finance charges relating to future periods
Finance leases are analysed as follows:
82,292 _______
Page 17
Chartered Institute of Public Relations
The following pages do not form part of the published accounts and are for management use only.
Page 18
Chartered Institute of Public Relations Detailed revenue account for the year ended 31 December 2009 2009 £
2008 £
£
£
Income Membership subscriptions Conferences and seminars Education
1,487,392
1,423,776
347,485
548,133
1,145,524
1,177,103
Qualifications
567,850
679,707
Awards events
766,533
808,435
Publications Website
17,133
24,394
100,449 _________ 4,432,366
113,946 _________ 4,775,494
Direct costs Conferences and seminars
282,879
475,658
Education
573,644
501,981
Qualifications
153,737
274,216
Awards events
418,063
557,958
7,011
10,676
66,038 _________ 1,501,372 _________
28,598 _________ 1,849,087 _________
Publications Website
Gross surplus Operational costs Administrative expenses Exceptional costs
(1,849,087) _________ 2,926,407
(1,501,372) _________ 2,930,994 221,850
292,913
3,094,385
2,826,841
307,849 _________
_________ (3,119,754) _________ (193,347)
(3,624,084) _________ (693,090) Other operating income Rent receivable Other income
14,131
(472)
109,324 _______
113,821 _______ 113,349 _______ (579,741)
Operating deficit
123,455 _______ (69,892)
Other income and expenses Interest receivable Bank deposit interest
2,489
34,502
Interest payable Leasing finance charges
(2,709) _______ (579,961) _______
Net deficit on ordinary activities for the year Page 19
_______ (35,390) _______
Chartered Institute of Public Relations Operational costs and administrative expenses for the year ended 31 December 2009 2009
2008
£
£
Journal costs
55,591
73,971
Journal adverts and sales
(2,233)
(6,868)
6,232
7,501
75,469
89,478
Operational costs
Library and research Membership development and services Grants to groups International representation Subscriptions Policy development Marketing
1,884
7,276
13,094
30,087
4,219
4,913
970
308
9,177
4,054
57,447 _______ 221,850 _______
82,193 _______ 292,913 _______
1,456,096
1,426,449
Employer's NI contributions
149,364
150,157
Staff money purchase pension costs
150,427
133,705
69,626
74,368
National, regional and sectoral groups general expenditure
Administrative expenses Wages and salaries
Group life and health insurance
9,832
59,857
Premises
Staff training and recruitment
789,112
508,457
Insurance
20,181
9,153
Printing and stationery
22,569
27,550
Postage
13,130
19,272
Telephone, fax and internet
22,105
16,683
Computer costs
36,925
50,634
Travelling
44,887
45,492
AGM, elections and annual report
11,173
17,985
Legal and professional
18,170
34,188
Accountancy
33,670
63,185
Audit
17,250
16,250
Bank charges
40,884
45,409
Disciplinary procedures
16,238
119
General expenses
32,102
34,021
Unrecovered VAT
43,730
36,741
Amortisation on short leasehold
39,990
7,466
Depreciation on computers
22,311
33,559
Depreciation on furniture & equipment
29,139
16,141
Losses on disposal of tangible assets
5,474 __________ 3,094,385 __________
__________ 2,826,841 __________
252,863
-
Bad Debt – deposit write off
15,000
-
Legal fees – deposit recovery
19,185
-
20,801 __________ 307,849 __________
__________ __________
Exceptional costs Dilapidations
Premises – removal costs
Page 20