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Financial Statements YEAR ENDED 31 DECEMBER 2016
Singapore Indian Development Association Registration Number: UEN S90SS0098L Charity Registration Number: 0909
Singapore Indian Development Association General Information Year ended 31 December 2016
General Information Patron – Prime Minister Lee Hsien Loong Life Trustees Mr Tharman Shanmugaratnam Professor S Jayakumar Mr S Dhanabalan Mr S Chandra Das Mr J Y Pillay Mr Sat Pal Khattar Mr K Shanmugam Dr N Varaprasad
Chairman
Term Trustees Ms Indranee T Rajah Mr M Rajaram Mr Ravi Menon Mr Inderjit Singh Mr V Shankar Mr Gautam Banerjee Mr Girija Pande Mr R Jayachandran Mr Ravinder Singh Justice Judith Prakash Mr K Kesavapany
Advisors Dr Vivian Balakrishnan Mr S Iswaran Mr Hri Kumar Nair Mr Vikram Nair
Audit Review Committee Members Mr Gautam Banerjee Mr Shabbir Hassanbhai Mr Sarjit Singh Mr K V Rao Mr Subramaniam Iyer Mr Mohan Pillay
Chairman
1
Singapore Indian Development Association General Information Year ended 31 December 2016
Executive Committee Members Ms Indranee T Rajah Mr Viswa Sadasivan Mr Shabbir Hassanbhai Mr Sarjit Singh Mr Shekaran Krishnan Mr Subramaniam Iyer Mr V P Jothi Mr R Rajaram Mr Puvan Ariaratnam Dr Joshua V M Kuma Mr K V Rao Mr Chandra Mohan Rethnam Mr K Ramamoorthy Mr Sarbjit Singh
President Vice-President Vice-President Secretary Treasurer Member Member Member Member Member Member Member Member Member
Chief Executive Officer Mr Kumaran Barathan
Address No. 1 Beatty Road Singapore 209943
Auditors PricewaterhouseCoopers LLP Partner-in-charge: Yee Chen Fah (since the financial year ended 31 December 2016)
2
Singapore Indian Development Association Independent auditors’ report Year ended 31 December 2016
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF SINGAPORE INDIAN DEVELOPMENT ASSOCIATION Our Opinion In our opinion, the accompanying financial statements of Singapore Indian Development Association (“the Association”) are properly drawn up in accordance with the provisions of the Societies Act, Chapter 311 (“the Societies Act”), the Charities Act, Chapter 37 and other relevant regulations (“the Charities Act and Regulations”) and Financial Reporting Standards in Singapore (“FRSs”) so as to present fairly the state of affairs of the Association as at 31 December 2016 and the results, changes in funds and cash flows of the Association for the year ended on that date. What we have audited The financial statements of the Association comprise: the statement of financial position as at 31 December 2016; the statement of comprehensive income for the year then ended; the statement of changes in funds for the year then ended; the statement of cash flows for the year then ended; and the notes to the financial statements, including a summary of significant accounting policies. Basis for Opinion We conducted our audit in accordance with Singapore Standards on Auditing (“SSAs”). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We are independent of the Association in accordance with the Accounting and Corporate Regulatory Authority (“ACRA”) Code of Professional Conduct and Ethics for Public Accountants and Accounting Entities (“ACRA Code”) together with the ethical requirements that are relevant to our audit of the financial statements in Singapore, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ACRA Code. Other Information Management is responsible for the other information. The other information comprises the information included in the Statement by President, Treasurer and Chief Executive Officer, but does not include the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and we do not and will not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed on the other information that we obtained prior to the date of this
auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
4
Singapore Indian Development Association Independent auditors’ report Year ended 31 December 2016
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF SINGAPORE INDIAN DEVELOPEMNT ASSOCIATION (continued) Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with the provisions of the Societies Act, the Charities Act and Regulations and FRSs, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the Association’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Association or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Association’s financial reporting process. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with SSAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit 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 Association’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Association’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Association to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
5
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Statement of financial position As at 31 December 2016 Note Non-current assets Plant and equipment Interest in Associate Loan due from associate
2016 S$
2015 S$
4 5 6
670,103 400,000 1,070,103
890,855 100 200,000 1,090,955
7
3,400,000
3,400,000
8 9 10
1,307,986 750,000 846,642 28,111,890 9,793,339 44,209,857 45,279,960
1,200,238 1,000,000 1,092,554 21,485,760 9,580,216 37,758,768 38,849,723
11
40,277,188 40,277,188
33,627,020 33,627,020
Non-current liabilities Deferred capital grants
12
7,252
16,518
Current liabilities Deferred capital grants Other payables and accrued expenses Unutilised specific grants/donations
12 13 14
9,447 1,829,196 3,156,877 4,995,520 5,002,772 45,279,960
28,109 2,600,186 2,577,890 5,206,185 5,222,703 38,849,723
Current assets Government Subvention receivable Donations receivable – Central Provident Fund Board Scheme Donations receivable – Singapore Totalisator Board Deposits, prepayments, tuition fee and other receivables Financial assets – investments Cash and cash equivalents Total assets Representing: Funds Unrestricted funds Accumulated funds Total funds
Total liabilities Total liabilities and funds
The accompanying notes form an integral part of these financial statements.
FS1
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Statement of comprehensive income Year ended 31 December 2016 Note
Income Income from generated funds Voluntary income: Donation – Central Provident Fund (CPF) contributions to SINDA fund Donation sponsorships Donation from Singapore Totalisator Board (STB) Income from School Pocket Money Fund (SPMF) Other donations Finance income: Dividend income Interest income: - unit trust fixed income - fixed deposits and bank balances Other income: Miscellaneous income Gain on disposal of investments Fair value gain of investments Exchange gain Total income from generated funds
15
2016 Accumulated funds Operations Investments Total S$ S$ S$
2015 Accumulated funds Operations Investments Total S$ S$ S$
14,671,165 1,235,892 250,000 58,491 275,237
– – – – –
14,671,165 1,235,892 250,000 58,491 275,237
13,225,015 1,698,410 500,000 71,246 756,485
– – – – –
13,225,015 1,698,410 500,000 71,246 756,485
–
150,384
150,384
–
134,042
134,042
– –
807 27,924
807 27,924
– –
3,730 4,558
3,730 4,558
40,584 – – – 16,531,369
– – 1,181,534 5,331 1,365,980
40,584 – 1,181,534 5,331 17,897,349
34,609 – – – 16,285,765
– 116,803 467,717 26,083 752,933
34,609 116,803 467,717 26,083 17,038,698
The accompanying notes form an integral part of these financial statements.
FS2
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Statement of comprehensive income (continued) Year ended 31 December 2016 Note
Income from charitable activities and other funding Income from approved projects: Tuition programme fees Government grants: Government Subvention Ministry of Culture, Community and Youth (MCCY): - Temporary Occupation Licence (TOL) Grant - Additional Top-up Grant Family Service Centre (FSC) Funding: - Ministry of Social and Family Development (MSF) - Singapore Totalisator Board (STB) - National Council of Social Services (NCSS) - Other FSC Funding’s Care and Share Funding Other government grants Wage Credit Scheme Funding Deferred capital grants amortised Other grant: Singapore Press Holdings (SPH) Newspaper Project Funding Total income from charitable activities and other funding Total income
2016 Accumulated funds Operations Investments Total S$ S$ S$
2015 Accumulated funds Operations Investments Total S$ S$ S$
682,174
–
682,174
707,864
–
707,864
7
3,400,000
–
3,400,000
3,400,000
–
3,400,000
16
457,579 540,000
– –
457,579 540,000
457,579 540,000
– –
457,579 540,000
1,512,055 397,032 79,407 87,382 – 237,710 35,230 27,928
– – – – – – – –
1,512,055 397,032 79,407 87,382 – 237,710 35,230 27,928
1,197,091 400,702 87,125 190,718 129,124 320,466 484,236 35,444
– – – – – – – –
1,197,091 400,702 87,125 190,718 129,124 320,466 484,236 35,444
94,580
–
94,580
77,450
–
77,450
7,551,077 24,082,446
– 1,365,980
7,551,077 25,448,426
8,027,799 24,313,564
– 752,933
8,027,799 25,066,497
12
The accompanying notes form an integral part of these financial statements.
FS3
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Statement of comprehensive income (continued) Year ended 31 December 2016 Note
Expenditures incurred on charitable activities Cost of generating funds (i) Cost of generating voluntary income: CPF agency fees (ii) Charitable activities: Education programmes Family services Youth development programmes Parent and children programmes Community engagement, volunteer management and donor engagement unit Publicity and marketing expenses (iii) Administrative and governance costs
–
(137,148)
(151,629)
–
(151,629)
16 16 16 16
(10,025,102) (2,394,093) (1,522,501) (1,081,150)
– – – –
(10,025,102) (2,394,093) (1,522,501) (1,081,150)
(9,730,324) (2,494,828) (1,504,261) (1,264,990)
– – – –
(9,730,324) (2,494,828) (1,504,261) (1,264,990)
16 16
(1,123,202) (419,281)
– –
(1,123,202) (419,281)
(1,195,082) (354,946)
– –
(1,195,082) (354,946)
16
(1,971,042)
–
(1,971,042)
(2,130,669)
–
(2,130,669)
– – (18,673,519)
Total expenditures
Net income for the year
2015 Accumulated funds Operations Investments Total S$ S$ S$
(137,148)
(iv) Other costs: Loss on disposal of investments Fees charged by fund managers
Share of loss of associate
2016 Accumulated funds Operations Investments Total S$ S$ S$
5
– 5,408,927
(60,589) (64,050)
(124,639) (18,798,158) (100) 1,241,241
– –
(60,589) (64,050)
(18,826,729)
(100) 6,650,168
– (65,087)
– (65,087)
(65,087) (18,891,816)
–
–
–
5,486,835
687,846
6,174,681
The accompanying notes form an integral part of these financial statements.
FS4
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Statement of changes in funds Year ended 31 December 2016 Accumulated funds, representing total unrestricted funds S$ At 1 January 2015
27,452,339
Total comprehensive income for the year Net income for the year, representing total comprehensive income for the year At 31 December 2015
6,174,681 33,627,020
At 1 January 2016
33,627,020
Total comprehensive income for the year Net income for the year, representing total comprehensive income for the year At 31 December 2016
6,650,168 40,277,188
The accompanying notes form an integral part of these financial statements.
FS5
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Statement of cash flows Year ended 31 December 2016 Note Cash flows from operating activities Net income for the year Adjustments for: Dividend income Loss/(Gain) on disposal of investments Share of loss of associate Fair value gain on investments Exchange gain Deferred capital grants amortised Depreciation Gain on disposal of plant and equipment Management fee rebate Interest income: - unit trust fixed income - fixed deposits and bank balances
6,650,168
4
Changes in: - donations, grants and Government Subvention receivable - deposits, prepayments, tuition fee and other receivables - other payables and accrued expenses, and unutilised specific grants/donations Net cash from operating activities Cash flows from investing activities Purchase of plant and equipment Proceeds from disposal of plant and equipment Loan due from associate Investments related management fee rebates Purchase of investments Proceeds from sale of investments Interest received: - unit trust fixed income - fixed deposits and bank balances Dividend received Net cash (used in)/provided by investing activities Net increase in cash and cash equivalents Cash and cash equivalents at 1 January Cash and cash equivalents at 31 December
2016 S$
6
6,174,681
(150,384) 60,589 100 (1,181,534) – (27,928) 287,075 (3,100) –
(134,042) (116,803) – (467,717) (26,083) (35,444) 389,831 (24,049)
(807) (27,924) 5,606,255
(3,730) (4,558) 5,752,086
142,252 248,911
(479,169) 228,418
(192,003) 5,805,415
(802,487) 4,698,848
(66,323) 3,100 (200,000) 59,453 (6,498,854) 1,257,546
(310,938) (200,000) 164,835 (7,439,862) 7,704,161
807 24,925 150,384 (5,268,962)
10
2015 S$
536,453 9,828,781 10,365,234
3,730 4,558 134,042 60,526 4,759,374 5,069,407 9,828,781
The accompanying notes form an integral part of these financial statements.
FS6
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Notes to the financial statements These notes form an integral part of the financial statements. The financial statements were authorised for issue by the Executive Committee (“Management”) on 6 April 2017.
1
Domicile and activities Singapore Indian Development Association (the “Association”) is a society registered with the Registrar of Societies under the Societies Act, Chapter 311. Its registered office is located at No. 1 Beatty Road, Singapore 209943. The Association’s Vision and Mission includes the following: Vision To build a strong and vibrant Singaporean Indian community together. Mission To build a well-educated, resilient and confident community of Indians that stand together with the other communities in contributing to the progress of multi-racial Singapore. In order to achieve its vision and mission the Association has articulated four Strategic Thrusts as follows: (i) (ii) (iii) (iv)
Maximising educational opportunities for all students; Engaging parents to play an active role in their children’s lives; Inspiring youths towards greater achievement; and Forging a stronger relationship with community partners.
The Association runs a range of programmes, services and initiatives aligned to its four Strategic Thrusts. The Association is registered as a charity under the Charities Act, Chapter 37 and it has been granted status as an Institution of Public Character (IPC) under the Charities Act for a period of 5 years with effect from 16 December 2016.
2
Significant accounting policies
2.1
Basis of preparation These financial statements have been prepared in accordance with Singapore Financial Reporting Standards (“FRS”) under the historical cost convention, except as disclosed in the accounting policies below. The preparation of these financial statements in conformity with FRS requires management to exercise its judgement in the process of applying the Association’s accounting policies. It also requires the use of certain critical accounting estimates and assumptions. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 3.
FS7
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Interpretations and amendments to published standards effective in 2016 On 1 January 2016, the Association adopted the new or amended FRS and Interpretations to FRS (“INT FRS”) that are mandatory for application for the financial year. Changes to the Association’s accounting policies have been made as required, in accordance with the transitional provisions in the respective FRS and INT FRS. The adoption of these new or amended FRS and INT FRS did not result in substantial changes to the accounting policies of the Association and had no material effect on the amounts reported for the current or prior financial years. 2.2
Investment in Associate Associate is an entity over which the Association has significant influence, but not control, generally accompanied by a shareholding giving rise to voting rights of 20% and above but not exceeding 50%. Investment in associate is accounted for in the financial statements using the equity method of accounting less impairment losses, if any. Investment in associate is initially recognised at cost. The cost of an acquisition is measured at the fair value of the assets given, equity instruments issued or liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Under the equity method of accounting, the investment is initially recognised at cost and adjusted thereafter to recognise Association’s share of its associate’s post-acquisition losses of the investee in profit or loss. When the Association’s share of losses in associate equals to or exceeds its interest in the associate, the Association does not recognise further losses, unless it has legal or constructive obligations to make, or has made, payments on behalf of the associate. Investment in associate is derecognised when the Association loses significant influence.
2.3
Currency translation The financial statements are presented in Singapore Dollar, which is the functional currency of the Association. Transactions in a currency other than the functional currency (“foreign currency”) are translated into the functional currency using the exchange rates at the dates of the transactions. Currency exchange differences resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at the closing rates at the balance sheet date are recognised in statement of comprehensive income. All foreign exchange gains and losses impacting profit or loss are presented in the statement of comprehensive income.
FS8
Singapore Indian Development Association Financial statements Year ended 31 December 2016
2.4
Plant and equipment Plant and equipment are recognised at cost less accumulated depreciation and accumulated impairment losses. Subsequent expenditure relating to plant and equipment that has already been recognised is added to the carrying amount of the asset only when it is probable that future economic benefits associated with the item will flow to the Association and the cost of the item can be measured reliably. All other repair and maintenance expenses are recognised in statement of comprehensive income when incurred. Depreciation is calculated using the straight-line method to allocate their depreciable amounts over their estimated useful lives as follows:
Computer Equipment Furniture and fittings Office equipment Office renovation
Useful lives 3 years 5 years 5 years 3 years
The residual values, estimated useful lives and depreciation method of plant and equipment are reviewed, and adjusted as appropriate, at each balance sheet date. The effects of any revision are recognised in statement of comprehensive income when the changes arise. 2.5
Impairment of non-financial assets Plant and equipment and Investment in Associate are tested for impairment whenever there is any objective evidence or indication that these assets may be impaired. For the purpose of impairment testing of assets, recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. If this is the case, the recoverable amount is determined for the cash-generating unit (CGU) to which the asset belongs. If the recoverable amount of the asset or (CGU) is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. The difference between the carrying amount and recoverable amount is recognised as an impairment loss in statement of comprehensive income. An impairment loss for an asset is reversed only if, there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. The carrying amount of this asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of accumulated depreciation) had no impairment loss been recognised for the asset in prior years. A reversal of impairment loss for an asset is recognised in statement of comprehensive income.
FS9
Singapore Indian Development Association Financial statements Year ended 31 December 2016
2.6
Financial Assets The Association classifies its financial assets in the following categories: financial assets at fair value through profit or loss and loans and receivables. The classification depends on the purpose for which the assets were acquired. Management determines the classification of its financial assets at initial recognition. (i)
Financial assets at fair value through profit or loss This category has two sub-categories: financial assets held for trading, and those designated at fair value through profit or loss at inception. A financial asset is classified as held for trading if it is acquired principally for the purpose of selling in the short term. Financial assets designated as at fair value through profit or loss at inception are those that are managed and their performances are evaluated on a fair value basis, in accordance with a documented Association investment strategy. Financial assets are initially recognised at fair value plus transaction costs. Transaction costs for financial assets at fair value through profit or loss are recognised immediately as expenses. Financial assets at fair value through profit or loss are subsequently carried at fair value. Changes in the fair values of financial assets at fair value through profit or loss including the effects of currency translation, interest and dividends, are recognised in statement of comprehensive income when the changes arise.
(ii)
Loans and receivables Bank balances Receivables Bank balances and Receivables are initially recognised at fair value plus transaction costs and subsequently carried at amortised cost using the effective interest method, less accumulated impairment losses. The Association assesses at each balance sheet date whether there is objective evidence that a financial asset or a group of financial assets is impaired and recognises an allowance for impairment when such evidence exists. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy and default or significant delay in payments are objective evidence that these financial assets are impaired. The carrying amount of these assets is reduced through the use of an impairment allowance account which is calculated as the difference between the carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. These assets are presented as current assets except for those that are expected to be realised later than 12 months after the balance sheet date, which are presented as noncurrent assets.
FS10
Singapore Indian Development Association Financial statements Year ended 31 December 2016
2.7
Cash and cash equivalents For the purpose of presentation in the statement of cash flows, cash and cash equivalents include cash on hand, cash at bank in investment accounts and deposits with financial institutions which are subject to an insignificant risk of change in value. For the purpose of the statement of cash flows, pledged fixed deposits are excluded from cash and cash equivalents.
2.8
Other Payables Other payables represent liabilities for goods and services provided to the Association prior to the end of financial year which are unpaid. They are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business, if longer). Otherwise, they are presented as non-current liabilities. Oher payables are initially recognised at fair value, and subsequently carried at amortised cost using the effective interest method
2.9
Offsetting of financial instruments Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is a legally enforceable right to offset and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.
2.10
Provisions Provisions are recognised when the Association has a present legal or constructive obligation as a result of past events, it is more likely than not that an outflow of resources will be required to settle the obligation and the amount has been reliably estimated. Provisions are measured at the present value of the expenditure expected to be required to settle the obligation using a pre-tax discount rate that reflects the current market assessment of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognised in the statement of comprehensive income as finance expense. Changes in the estimated timing or amount of the expenditure or discount rate are recognised in statement of comprehensive income when the changes arise.
2.11
Employee compensation Employee benefits are recognised as an expense, unless the cost qualifies to be capitalised as an asset. (a)
Defined contribution plans Defined contribution plans are post-employment benefit plans under which the Association pays fixed contributions into separate entities such as the Central Provident Fund on a mandatory, contractual or voluntary basis. The Association has no further payment obligations once the contributions have been paid.
FS11
Singapore Indian Development Association Financial statements Year ended 31 December 2016
(b)
Employee leave entitlement Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to the balance sheet date.
2.12
Income Donations from the Central Provident Fund Scheme and the Singapore Totalisator Board, which are probable for collection, are recognised on an accrual basis. All other donations are recognised on a receipt basis. Tuition programme fees income is recognised on an accrual basis. Grants for specific purposes are recognised to the extent the related expenditure has been incurred and the grant is receivable. Government Subvention and grants, which are probable for collection, are recognised on an accrual basis.
2.13
Expenditure incurred on charitable activities Expenditures incurred on charitable activities comprise direct expenditure including direct staff costs attributable to the activities. In addition, it also includes support costs (costs relating to central functions) and other costs that have been allocated on a basis consistent with the use of the resources. Administrative and governance costs Administrative and governance costs comprise all costs attributable to the general running of the Association, in providing the governance infrastructure and in ensuring public accountability.
2.14
Interest Income Interest income is recognised using the effective interest method.
2.15
Operating lease payments Payments made under operating leases (net of any incentives received from the lessor) are recognised in statement of comprehensive income on a straight-line basis over the period of the lease.
2.16
Funds of the Association Unrestricted funds Unrestricted funds which are represented by Accumulated funds comprise the general operating and investment funds. These funds are available for use at the discretion of the management in furtherance of the general objectives of the Association.
FS12
Singapore Indian Development Association Financial statements Year ended 31 December 2016
2.17
Deferred capital grant – from government Government grants related to maintenance of plant and equipment are recognised initially as deferred capital grant at fair value when there is reasonable assurance that they will be received and the Association will comply with the conditions associated with the grant. These grants are recognised as income over the periods necessary to match them with the depreciation expense on a systematic basis over the useful life of the asset. Cash grants received from the government in relation to the Wage Credit Scheme (“WCS”) are recognised on receipt basis. WCS was introduced to help the Association which may face rising wage costs in a tight labour market. The scheme apply for five years from 1 January 2013 to 31 December 2017.
3
Critical accounting estimates, assumptions and judgements Estimates, assumptions and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Information about critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements is included in the following note: Note 5 – interest in an associate; Information about assumptions and estimation uncertainty that have a significant risk of resulting in a material adjustment within the next financial year are included in the following note: Note 23 – valuation of financial instruments. Measurement of fair values A number of the Association’s accounting policies and disclosures require the measurement of fair values for financial assets. The Association has an established control framework with respect to the measurement of fair values. This includes an Investment Committee that has overall responsibility for all significant fair value measurements, including Level 3 fair values, and reports directly to the Board of Trustees. The Investment Committee regularly reviews significant unobservable inputs and valuation adjustments. Third party confirmations are used to measure fair values of investments in financial instruments. The Investment Committee assesses and documents the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of FRS, including the level in the fair value hierarchy in which such valuations should be classified. Significant valuation issues are reported to the Association’s Audit Review Committee.
FS13
Singapore Indian Development Association Financial statements Year ended 31 December 2016
When measuring the fair value of an asset, the Association uses market observable data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follow: Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). If the inputs used to measure the fair value of an asset fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement (with Level 3 being the lowest). Further information about the assumptions made in measuring fair values is included in note 23.
4
Plant and equipment Computer equipment S$ Cost At 1 January 2015 Additions Transfers At 31 December 2015 Additions Transfers DE recognition At 31 December 2016
Furniture Capital and Office Office work-in fittings equipment renovation progress S$ S$ S$ S$
1,310,164 8,500 125,452 1,444,116 – 19,480 (361,513) 1,102,083
523,200 4,210 – 527,410 1,748 – (196,259) 332,899
192,585 12,880 – 205,465 10,450 – (19,809) 196,106
828,490 40,600 38,800 907,890 – 10,375 (135,265) 783,000
Accumulated depreciation At 1 January 2015 961,570 Depreciation 222,441 At 31 December 2015 1,184,011 Depreciation 146,622 DE recognition (361,513) At 31 December 2016 969,120
397,525 43,798 441,323 35,135 (196,259) 280,199
117,126 27,230 144,356 25,513 (19,809) 150,060
673,768 96,362 770,130 79,805 (135,265) 714,670
86,087 52,700
61,109 46,046
137,760 68,330
Carrying amounts At 31 December 2015 At 31 December 2016
260,105 132,963
Total S$
265,298 3,119,737 244,748 310,938 (164,252) – 345,794 3,430,675 54,125 66,323 (29,855) – – (712,846) 370,064 2,784,152 – – – – – –
345,794 370,064
2,149,989 389,831 2,539,820 287,075 (712,846) 2,114,049
890,855 670,103
FS14
Singapore Indian Development Association Financial statements Year ended 31 December 2016
5
Interest in Associate 2016 S$ Interest in associate
2015 S$ -
100
Details of the associate are as follows: Name
Self Help Groups Student Care Limited
Principal activities
Operate school based student care centres in Singapore
Place of incorporation
Singapore
Voting rights held 2016 2015 % % 25
25
In October 2015, the Association entered into a memorandum of understanding (MOU), together with Chinese Development Assistance Council, Yayasan Mendaki, and the Eurasian Association (together Self-Help Groups (SHGs)), to incorporate Self Help Groups Student Care Limited (SHGSC) (the “Associate�). Incorporation of the Associate is in line with the mandate by the Ministry of Education (MOE) to provide educational and family related support services to students from low and middle income families. Programmes to be conducted by the Associate will be all-inclusive and multiracial which is aligned with the Association’s Mission. The Associate was incorporated in November 2015 and is a public company limited by guarantee. Upon incorporation of the Associate, each SHG contributed S$100. The Association has appointed two directors to the Board of Directors to participate in operational and financial decisions of the Associate. The Association is entitled to 25% of total voting rights at the Board of Directors meetings. The Association has determined that the Associate is insignificant and as a result disclosed the following summarised unaudited financial information of the Associate which is prepared in accordance with FRS. 2016 S$
2015 S$
Statement of comprehensive income Revenue Loss and total comprehensive loss for the year
1,728,647 (1,422,222)
30,000 (11,245)
Statement of financial position Non-current assets Current assets Non-current liabilities Current liabilities Net deficit
210,215 1,097,193 (2,000,000) (740,875) (1,433,467)
94,432 1,046,609 (1,047,785) (104,501) (11,245)
FS15
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Notwithstanding the Association’s ability to participate in operational and financial decisions of the Associate, the MOU prohibits the Association, together with other SHGs, from obtaining any variable returns in the forms of profits, dividends, or residual interest in net assets in the events of liquidation or winding-down. The Association, collectively with other SHGs, agreed not to receive any variable returns in forms of dividend, bonus, or profits from the Associate. Management has exercised significant judgement in determining the extent of its significant influence over the Associate, and concluded that the Association has significant influence over the Associate. Therefore, the Association recognised it as an associate in the statement of financial position. The objective of Association for setting up the Associate is to extend its Mission to students from all races in Singapore and the investment in the Associate, in substance, is not meant to be a commercially-driven transaction with the purpose of profit takings. Therefore, the Association does not equity account for any variable returns in form of dividend bonus, or profits from the Associate. The Association’s financial statements include the Association’s share of losses of the Associate. The Association’s exposure to losses is limited to the carrying amount of the investment.
6
Loan due from associate Loan due from associate amounting to S$400,000 (2015: S$200,000) represents the first and second tranche of the Association’s total commitment to the Associate (see note 21) which is made in the form of an unsecured and interest free loan. The loan does not have any fixed repayment terms and is expected to be repaid when the Associate’s cash flows permit in due course. The Association has determined the classification of loan to be non-current as at 31 December 2016.
7
Government Subvention receivable This represents the annual “Dollar-for-Dollar” Matching Grant receivable, subject to a maximum of S$3,400,000 (2015: S$3,400,000), from the Ministry of Culture, Community and Youth (MCCY).
FS16
Singapore Indian Development Association Financial statements Year ended 31 December 2016
8
Deposits, prepayments, tuition fee and other receivables 2016 S$ Deposits Other receivables Loans and receivables Prepayments
20,457 728,799 749,256 97,386 846,642
2015 S$ 20,458 989,679 1,010,137 82,417 1,092,554
The Association’s exposure to credit risk and impairment losses for receivables are disclosed in note 23.
9
Financial assets – investments Note Financial assets at fair value through profit or loss: - REITS/real estate funds - Absolute return funds - Private equity funds - Unit trusts: - equity - fixed income - Cash at bank in investment accounts held with fund managers/custodians
10
2016 S$
2015 S$
222,810 931 231,315
411,611 17,157 370,682
10,497,780 16,481,159 27,433,995
7,508,188 12,823,557 21,131,195
677,895 28,111,890
354,565 21,485,760
During the year, the Association invested additional $5,000,000 in unit trusts equities and fixed income and the remaining additions to investments amounting to $1,498,854 were funded from the disposal proceeds of investments in the current financial year and cash at bank with fund managers/custodians.
10
Cash and cash equivalents Note
Bank balances Fixed deposits Cash and cash equivalents in the statement of financial position Cash at bank in investment accounts Fixed deposits pledged* Cash and cash equivalents in the statement of cash flows
9
2016 S$
2015 S$
4,764,109 5,029,230
4,372,636 5,207,580
9,793,339 677,895 10,471,234 (106,000) 10,365,234
9,580,216 354,565 9,934,781 (106,000) 9,828,781
*Fixed deposits have been pledged to obtain a letter of guarantee in lieu of deposit fee from a bank for the purpose of obtaining a Temporary Occupation Licence (TOL) for the Association’s premises (see note 16).
FS17
Singapore Indian Development Association Financial statements Year ended 31 December 2016
11
Accumulated funds Accumulated funds are the Association’s general operating funds and can be used for any of the Association’s activities. The Accumulated funds are represented by the following assets and liabilities: Note 2016 2015 S$ S$ Plant and equipment Interest in Associate Loan due from Associate Government Subvention receivable Donations receivable – Central Provident Fund Board Scheme Donation receivable – Singapore Totalisator Board Deposits, prepayments, tuition fee and other receivables Financial assets – investments Cash at bank in investment accounts held with fund managers/custodians Cash in hand and at bank Fixed deposits Deferred capital grants Other payables and accrued expenses Unutilised specific grants/donations
12
4 5 6 7
670,103 400,000 3,400,000
890,855 100 200,000 3,400,000
8 9
1,307,986 750,000 846,642 27,433,995
1,200,238 1,000,000 1,092,554 21,131,195
677,895 4,764,109 5,029,230 (16,699) (1,829,196) (3,156,877) 40,277,188
354,565 4,372,636 5,207,580 (44,627) (2,600,186) (2,577,890) 33,627,020
9 10 10 12 13 14
Deferred capital grants 2016 S$ Non-current Current
7,252 9,447 16,699
2015 S$ 16,518 28,109 44,627
The Association has been awarded two government grants. One of the grants, received by the Association in 2014, was unconditional, amounted to S$2,016 as at 31 December 2016 and is utilised over the useful life of the computer equipment. The second grant received in 2014, was unconditional and amounted to S$14,683 as at 31 December 2016. The grant is utilised over the useful lives of the respective assets. Movement: 2016 S$ Balance at 1 January Amortisation to the statement of comprehensive income during the year Balance at 31 December
2015 S$
44,627
80,071
(27,928) 16,699
(35,444) 44,627
FS18
Singapore Indian Development Association Financial statements Year ended 31 December 2016
13
Other payables and accrued expenses 2016 S$ Payables to suppliers and service providers Accrued expenses
950,848 878,348 1,829,196
2015 S$ 1,430,204 1,169,982 2,600,186
The Association’s exposure to liquidity risk related to other payables and accrued expenses is disclosed in note 23.
14
Unutilised specific grants/donations These comprise specific grants/donations for: 2016 S$ (I) (ii) (iii) (iv) (v) (vi) (vii) (viii)
(i)
Tamil Language Learning and Promotion Committee (TLLPC) Singapore Indian Education Trust (SIET) School Pocket Money Fund (SPMF) Singapore Press Holding (SPH) Foundation Newspaper Project Project Give donations Youth Development Programmes Single Parent Programme/Sponsorships Care and Share Funding
2015 S$
274,004 414,528 7,246
414,480 321,488 27,381
18,489 217,979 170,396 804,235 1,250,000 3,156,877
12,279 292,246 439,548 1,070,468 – 2,577,890
Tamil Language Learning and Promotion Committee (TLLPC) Tamil Language Learning and Promotion Committee (TLLPC) is a committee set up by the Ministry of Education (MOE) to promote the learning and use of the Tamil language. The Association provides support to TLLPC in the administration of the TLLPC funds. Grants and donations are the main sources of income with MOE providing a matching grant for funds raised by the TLLPC.
(ii) Singapore Indian Education Trust (SIET) Singapore Indian Education Trust (SIET) is a registered charity offering solutions to the needs and challenges impacting the educational performance of the Indian community. The Association’s programmes are designed to focus mainly on the education of students from pre-primary to secondary while SIET’s focus is on tertiary level education. Both of the organisations recognise the immense opportunity to leverage on the synergy between the two organisations. The collaborative arrangement has been set up to manage donations received on behalf of SIET and its disbursements to students who qualify for financial assistance for their course of study at the tertiary institutions and other schemes administered by SIET.
FS19
Singapore Indian Development Association Financial statements Year ended 31 December 2016
(iii) School Pocket Money Fund (SPMF) The Association receives yearly grants from the National Council of Social Service (NCSS) pertaining to SPMF. All bursary payments made under this service will be paid out from SPMF based on criteria set out by NCSS. (iv) Singapore Press Holding (SPH) Foundation Newspaper Project SPH Foundation Newspaper Project is a programme to sponsor subscriptions to the Straits Times and Tamil Murasu Newspapers. Under this project, the Association identifies the needy households who wish to read the Straits Times newspaper and SPH sponsors the subscription costs. (v) Project Give donations Project Give is a community fund raising campaign to raise money for educational and financial assistance for students from needy families. It typically runs through the various festivities such as Hari Raya Pause, Deepavali and Christmas. Funds are raised via direct cheque donations, donation boxes placed with partner retailers, online, and at a booth set up by the Association during Deepavali Fair at Campbell Lane (Deepavali Bazaar) (2015: Hastings Road (Deepavali Bazaar)). (vi) Youth Development Programmes Youth Development Programmes specifically focus on the following four key (2015: four programmes) programmes as follows: Senior Victory – a school based motivational programme that aims to bring out leadership qualities and encourage the practice of positive life skills through structured activities and trained facilitators. Youth Empowerment Programme – a one-to-one mentorship programme to engage “atrisk” youth and who have low self-esteem or other behavioural problems. Mentorship programme for Institute of Technical Education (ITE) students – a programme to engage students of ITE through interest-based mentoring. Teach Secondary Programme – a school-based tutorial programme that aims to improve the academic performance of Indian students in maths and science at secondary schools through intensive small group tuition. Project Teach emphasises on close collaboration between schools, parents and tutors, and allows for these stakeholders to work together to improve students’ academic performance. The funds will be channelled towards the content development, programme evaluation tools, motivational camps and workshops for the above mentioned programmes.
FS20
Singapore Indian Development Association Financial statements Year ended 31 December 2016
(vii) Single Parent Programme/Sponsorships Single Parent Programme provides holistic assistance to single parents and their children. Children of single parents would receive assistance from all of the Association’s programmes including Tuition, NEU PC, and Enrichment while parents receive assistance on skills upgrading, financial planning and family support to help build their self-esteem and become self-sufficient. Sponsorships were received for specific programmes like financial assistance, bursary, and educational programmes. (viii) Care and Share Funding Care and Share Funding is a national fund-raising and volunteerism movement led by Community Chest for the social service sector, in celebration of SG50 (Singapore’s 50th year of independence). Eligible donations raised by participating Voluntary Welfare Organisations (VWOs) from 1 December 2013 until 31 March 2016 will be matched dollar-for-dollar by the Government of Singapore and is capped at S$2,250,000 per VWO. The matched amount will be utilised towards building the capabilities and capacities of the social service sector and supporting social services to meet rising needs.
15
Donations – Central Provident Fund (CPF) contributions to SINDA fund With effect from 1 January 2015, Central Provident Fund (CPF) contribution rates to the SINDA Fund were revised. The revision in rates is aimed to assist the Association as follows: Improve the quality of existing educational, family and youth related programmes; Introduce new educational, family and youth related programmes; Expand the Association’s reach to a wider and/or more specific target groups. The Association derived an increase in income from CPF contributions during the year as a direct result of the revised rates. The Association expects to ramp up existing programmes and introduce new programmes. Management expects to fully utilise additional funds when initiatives are fully implemented.
16
Expenditures incurred on charitable activities, administrative and governance costs Note Charitable activities Education programmes Tuition programmes: - STEP programme - Project Teach Other education programmes: - Enrichment programmes - Bursary/scholarships - Staff costs - Support costs
17
2016 S$
2015 S$
3,927,191 1,105,864
3,737,409 1,149,820
353,362 658,915 2,008,267 1,971,503 10,025,102
351,699 513,734 1,762,919 2,214,743 9,730,324
FS21
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Note
Family services - Casework and counselling - School Pocket Money Fund (SPMF) - Single Parents Programme - Other programmes - Staff costs - Support costs
Youth development programmes - SINDA Youth Club activities - Youth motivational programmes - Staff costs - Support costs
Parent and children programmes - Preschool programmes - Programme for parents - Staff costs - Support costs
Community engagement, volunteer management and donor engagement unit - Networking initiatives - Collaborative programmes - Volunteer management - Staff costs - Support costs
Publicity and marketing expenses - Corporate communications - Market communications - Staff costs - Support costs
Administrative and governance costs - Professional charges - Temporary Occupation Licence (TOL) fee expenses* - Support costs
17
17
17
17
17
17
2016 S$
2015 S$
202,265 58,360 25,518 363,145 1,113,538 631,267 2,394,093
181,315 70,210 19,598 421,958 1,124,452 677,295 2,494,828
147,342 353,334 667,973 353,852 1,522,501
145,828 284,212 694,240 379,981 1,504,261
329,895 76,452 385,180 289,623 1,081,150
304,146 166,007 435,052 359,785 1,264,990
91,719 43,288 30,285 672,435 285,475 1,123,202
119,277 66,617 16,484 686,465 306,239 1,195,082
73,121 8,288 32,944 304,928 419,281
48,791 2,160 18,697 285,298 354,946
22,520 463,435 1,485,087 1,971,042
71,692 454,838 1,604,139 2,130,669
FS22
Singapore Indian Development Association Financial statements Year ended 31 December 2016
*The Association occupies land owned by the Government of Singapore at No. 1 Beatty Road Singapore 209943 and pays an annual Temporary Occupation Licence (TOL) fee expense. The expense is supported by the TOL Grant from the Ministry of Culture, Community and Youth (MCCY) of S$457,579 (2015: S$457,579). The expenditures have been summarised as follows: ‹--------------- 2016 ---------------› Support costs Direct (see note costs 17) Total S$ S$ S$
‹--------------- 2015 ---------------› Support costs Direct (see note costs 17) Total S$ S$ S$
Programmes Education programmes
8,053,599 1,971,503 10,025,102 7,515,581 2,214,743 9,730,324
Family services 1,762,826 631,267 Youth development programmes 1,168,649 353,852 Parent and children programmes 791,527 289,623 Community engagement, volunteer management and donor engagement unit 837,727 285,475 Publicity and marketing expenses 114,353 304,928 Administrative and governance costs 485,955 1,485,087
17
2,394,093 1,817,533
677,295 2,494,828
1,522,501 1,124,280
379,981 1,504,261
1,081,150
905,205
359,785 1,264,990
1,123,202
888,843
306,239 1,195,082
419,281
69,648
1,971,042
285,298
354,946
526,530 1,604,139 2,130,669
Support costs
Staff costs S$ 2016 Education programmes Family services Youth development programmes Parent and children programmes Community engagement, volunteer management and donor engagement unit Publicity and marketing expenses Administrative and governance costs Total
Maintenance and administrative Depreciation expenses S$ S$
Total S$
1,160,448 319,123 174,067 116,045
739,285 260,471 148,207 133,388
71,770 51,673 31,578 40,190
1,971,503 631,267 353,852 289,623
145,056 199,144
117,453 82,818
22,966 22,966
285,475 304,928
754,291 2,868,174
684,864 2,166,486
45,932 287,075
1,485,087 5,321,735
FS23
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Staff costs S$ 2015 Education programmes Family services Youth development programmes Parent and children programmes Community engagement, volunteer management and donor engagement unit Publicity and marketing expenses Administrative and governance costs Total
Maintenance and administrative expenses Depreciation S$ S$
Total S$
1,246,718 334,485 182,447 152,039
870,567 272,640 154,653 153,170
97,458 70,170 42,881 54,576
2,214,743 677,295 379,981 359,785
152,039 163,749
123,013 90,363
31,187 31,186
306,239 285,298
790,603 3,022,080
751,163 2,415,569
62,373 389,831
1,604,139 5,827,480
Support costs in respect of staff costs, maintenance and administrative expenses are allocated to charitable activities based on level of activities. Support costs in respect of depreciation are allocated to charitable activities based on floor area occupied.
18
Net income for the year The following items have been included in arriving at net income for the year: Note
Employee benefits expense (see below) Depreciation Employee benefits expense: Staff costs Contributions to defined contribution plans
19
4
2016 S$
2015 S$
7,748,514 287,075
7,743,905 389,831
6,817,729 930,785 7,748,514
6,908,662 835,243 7,743,905
Taxation The Association is an approved charity organisation under the Charities Act, Chapter 37 and an Institution of Public Character under the Income Tax Act, Chapter 134. No provision for tax has been made in the financial statements as the Association is exempt from income tax.
FS24
Singapore Indian Development Association Financial statements Year ended 31 December 2016
20
Transactions with key management personnel Key management personnel compensation comprised: 2016 S$ Short-term employment benefits Post-employment benefits (including CPF)
Salary range Salary above S$200,000 Salary within range S$150,000 to S$200,000 Total
2015 S$
632,246 48,482 680,728
3 − 3
709,977 70,738 780,715
3 − 3
The key management personnel remuneration comprise remuneration paid to the top three (2015: three) key executives including the Chief Executive Officer. One of the key management personnel was seconded from the Ministry of Education from 2014. The Trustees and Executive Committee members do not receive any remuneration from the Association.
21
Commitments Long term interest free loan The Association committed to contribute long-term interest free loan of S$800,000 to SHGSC (see note 6) from 2015 to 2019. As at 31 December 2016, the remaining commitment amounts to S$400,000 (2015: S$600,000). Capital expenditure Total approved, uncommitted, capital expenditure for 2017 approved by the Board of Trustees is S$1.9m (2015: S$0.975m).
22
Related party transactions For the purpose of financial statements, parties are considered to be related to the Association if the Association has the ability, directly, or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Association and the party are subject to common control or common significant influence. Related parties may be individuals or other entities. Other than the transactions disclosed elsewhere in the financial statements, there were no significant related party transactions between the Association and its related parties during the financial year.
FS25
Singapore Indian Development Association Financial statements Year ended 31 December 2016
23
Financial instruments Financial risk management Overview The Association has exposure to the following risks arising from financial instruments: credit risk liquidity risk market risk This note presents information about the Association’s exposure to each of the above financial risks. Further quantitative disclosures are included throughout these financial statements. Risk management framework The Board of Trustees and Executive Committee have an overall responsibility for the establishment and oversight of the Association’s risk management framework. The Association’s activities expose it to credit risk, liquidity risk and market risk. The Association has policies and processes for measuring and managing these risks. The Board of Trustees and Executive Committee review and approve the policies for managing each of these risks. The Association’s risk management policies are established to identify and analyse the risks faced by the Association, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in the Association’s activities. The Association, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and responsibilities. There were no significant changes to the Association’s financial risks during the year. Credit risk Credit risk is the risk of financial loss to the Association if the counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Association’s receivables from various sources and investments. The Association’s exposure to credit risk arises principally from receivables, financial assets – investments, and cash and cash equivalents. The carrying amounts of financial assets in the statement of financial position represent the Association’s maximum exposure to credit risk. The Association establishes an allowance for impairment that represents its estimate of incurred losses in respect of its receivables. The main components of this allowance are a specific loss component that relates to individually significant exposures.
FS26
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Exposure to credit risk The Association’s exposure to credit risk is low as most of its receivables are from government agencies. As at the end of the financial year, 88% (2015: 85%) of the Association’s receivables are due from 3 counterparties (2015: 3 counterparties). Impairment Receivables (current) comprise: Note
Government Subvention receivable Donations receivable – Central Provident Fund Board Scheme Donations receivable – Singapore Totalisator Board Deposits, tuition fees and other receivables
8
2016 S$
2015 S$
3,400,000
3,400,000
1,307,986 750,000 749,256 6,207,242
1,200,238 1,000,000 1,010,137 6,610,375
The Association monitors receivables credit risk based on their characteristics. An analysis of the credit quality of receivables that were not past due nor impaired and past due at the reporting date is as follows: 2016 S$ Not past due nor impaired Past due 0 – 30 days Past due 31 – 60 days Past due 61 – 90 days Past due 91 – 180 days
5,686,036 2,080 19,126 500,000 – 6,207,242
2015 S$ 6,059,154 13,353 5,037 522,037 10,794 6,610,375
There is no allowance for receivables required as at 31 December 2016 (2015: nil) as the Association believes that the unimpaired amounts are still collectible in full, based on historic payment behaviour and the credit quality is determined to be at an acceptable risk. Cash and cash equivalents The Association’s cash and cash equivalents are placed with banks and financial institutions which are regulated and rated A and B (2015: A and B) on Standard & Poor’s financial strength ratings. At the reporting date, the Association’s cash and cash equivalents are placed with three financial institutions (2015: three) and represent the Association’s maximum exposure to the concentration of credit risk.
FS27
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Liquidity risk Liquidity risk is the risk that the Association will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Association’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Association’s reputation. Typically, the Association ensures that it has sufficient cash on demand to meet expected operational expenses. This excludes the potential impact of extreme circumstances that cannot reasonably be predicted. As at reporting date, the contractual undiscounted cash flows of the Association’s financial liabilities approximate the carrying values and are due within 1 year. Market risk Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Association’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return on risk. Market risk is managed by the Investment Committee by closely monitoring the market data and by setting up detailed investment policies. Currency risk The Association’s exposure to currency risk relates primarily to its investments. By virtue of its investment activities to optimise return, the Association is exposed to the effects of foreign currency exchange rate fluctuations, principally in currencies such as the United States dollar (USD). The Association’s foreign currency exposures at the reporting date are as follows: 2016 S$ Financial assets – investments USD
859,847
2015 S$
1,028,264
FS28
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Sensitivity analysis A 10% change of the USD against the Singapore Dollar at the reporting date would vary the net income by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant. Net income S$ 31 December 2016 - strengthened - weakened
85,985 (85,985)
31 December 2015 - strengthened - weakened
102,826 (102,826)
Interest rate risk At the reporting date, the interest rate profile of the interest-bearing financial instruments was as follows: Nominal amount 2016 2015 S$ S$ Fixed rate instruments Fixed deposits
5,029,230
5,207,580
At the reporting date, management assessed that an increase/(decrease) of 25 basis points in interest rates would have no significant impact to the results of the Association (2015: No significant impact). Price risk Price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market. Sensitivity analysis The Association’s investments are designated as fair value through income or expenditure. A 10% increase or decrease in the underlying market prices at the reporting date, with all variables held constant would increase or decrease the net income by S$2,743,400 (2015: S$2,113,120).
FS29
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Funds management The Association is a society with no share capital at the reporting date. The Association builds up its funds from donations received and also through prudent management of its financial resources. The funds of the Association include unrestricted funds represented by the Accumulated funds (see note 11). The reserves of the Association provide financial stability and the means for the development of the Association’s activities. The Association intends to maintain the reserves at a level sufficient for its operating needs. The Board of Trustees and the Executive Committee of the Association review the level of reserves regularly for the Association’s continuing obligations. Ratio between the Association’s annual operating expenditure and its funds is as follows: 2016 S$ Total funds at 31 December Annual operating expenditure Ratio of funds to annual operating expenditure
40,277,188 18,673,519 2.2:1
2015 S$ 33,627,020 18,826,729 1.8:1
The Association’s funds are closely monitored to ensure that there are sufficient funds to support its programmes and activities. The Association is not subject to externally imposed requirements. Accounting classification and fair values Fair values versus carrying amounts Fair value is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date. The carrying amounts of receivables and other financial liabilities approximate their fair values due to the relatively short period to maturity of these financial assets and liabilities. The carrying amount of loan due from associate (Note 6) approximates its fair value.
FS30
Singapore Indian Development Association Financial statements Year ended 31 December 2016
The fair value of financial assets and liabilities, together with the carrying amounts, shown in the statement of financial position are as follows:
Note
31 December 2016 Loan due from associate Government Subvention receivable Donations receivable – Central Provident Fund Board Scheme Donations receivable – Singapore Totalisator Board Deposits, prepayments, tuition fee and other receivables Financial assets – investments Cash and cash equivalents Other payables and accrued expenses 31 December 2015 Loan due from associate Government Subvention receivable Donations receivable – Central Provident Fund Board Scheme Donations receivable – Singapore Totalisator Board Deposits, prepayments, tuition fee and other receivables Financial assets – investments Cash and cash equivalents Other payables and accrued expenses
6 7
8 9 10 13
6 7
8 9 10 13
Loans and receivables S$
Carrying amount Fair value through Other income or financial expenditure liabilities S$ S$
400,000 3,400,000 1,307,986 750,000 749,256 677,895 9,793,339 – 17,078,476
– – – – 27,433,995 – – 27,433,995
200,000 3,400,000 1,200,238 1,000,000 1,010,137 354,565 9,580,216 – 16,745,156
– – – – 21,131,195 – – 21,131,195
Fair value
Total S$
Total S$
– – – – – – (1,829,196) (1,829,196)
400,000 3,400,000 1,307,986 750,000 749,256 28,111,890 9,793,339 (1,829,196) 42,683,275
400,000 3,400,000 1,307,986 750,000 749,256 28,111,890 9,793,339 (1,829,196) 42,683,275
– – – – – – (2,600,186) (2,600,186)
200,000 3,400,000 1,200,238 1,000,000 1,010,137 21,485,760 9,580,216 (2,600,186) 35,276,165
200,000 3,400,000 1,200,238 1,000,000 1,010,137 21,485,760 9,580,216 (2,600,186) 35,276,165
FS31
Singapore Indian Development Association Financial statements Year ended 31 December 2016
Fair value hierarchy The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows: Note
Level 1 S$
Level 2 S$
Level 3 S$
Total S$
31 December 2016 Financial assets – fair value through profit or loss
9
26,978,939
–
455,056 27,433,995
31 December 2015 Financial assets – fair value through profit or loss
9
20,331,745
–
799,450 21,131,195
Measurement of fair values The following table shows a reconciliation from the opening balances to the ending balances for Level 3 fair values: Financial assets – fair value through profit or loss S$ At 1 January 2016 Purchases Total unrealised loss recognised in the statement of comprehensive income Disposals Total realised gain on disposal recognised in the statement of comprehensive income At 31 December 2016
799,450 5,954 (55,083) (294,650) (615) 455,056
Valuation techniques and significant unobservable inputs The following table shows the valuation technique used in measuring Level 3 fair values, as well as the significant unobservable inputs used:
Financial assets – fair value through Type of profit or loss investment
REIT/real estate Real estate funds fund Absolute return Private equity funds fund Private equity Private equity funds fund
Fair value at 31 December 2016 2015 S$ S$
222,810 931 231,315
Inter relationship between key unobservable Significant inputs and fair Valuation unobservable value technique inputs measurement
Net Asset Value Not applicable Net Asset 7,157 Value Not applicable Net Asset 370,682 Value Not applicable 411,611
Not applicable Not applicable Not applicable
FS32
Singapore Indian Development Association Financial statements Year ended 31 December 2016
The Association obtains third party statements to determine the Net Asset Values (“NAV�) of investments included in Level 3. The Association’s Investment Committee has determined that the reported NAV represent fair values at the reporting date.
FS33
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