STR ØMME FOUNDATION ANNUAL REPOR T 2015
Contents
Word from the Secretary General 3 International department 4-5 Support to projects 2015 by country and thematic goal 6-7 Communication and Fundraising 8-9 A World Free From Poverty 10-11 Anti-corruption Report 2015 12-13 Mimeta 14 Other programmes - Fredskorpset (FK) and Act Now 15 Report from The Strømme Foundation Board of Directors for 2015 16-18 Activity account and Balance sheet 19 Strømme Foundation 31.12.2015 20 Cashflow 21 Accounting principles 21-22 Notes 22-28 Auditor´s report 30 Board and council members 31 Facts behind the figures 31
2
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Word from the Secretary General
“Thank you for choosing Strømme Foundation!” The main focus in 2015 was to implement programmes according to plan: to continue efforts to achieve SF’s broader development objectives with regards to becoming more rights-based, integrating cross-cutting issues, enhancing our focus on anti-corruption and prioritising innovation. (See the following report). We are now half way through our Strategic Plan for 2014-2018. We are continuing tobuild the capacity of our partner organisations in order to maximise the effect of programmes and strengthen civil society. As we move forward into the final years of this period’s Strategic Plan, the innovative use of modern technology in development is one of the merging challenges.
Being an International Development agency operating in very complex and challenging contexts, it is important to be reminded about the initiative that led to the formation of Strømme Foundation. It was an initiative of Pastor Olaf Kristian Strømme who, driven by his faith, had a strong passion for the enormous injustice of marginalized and poor people. He was able to touch the hearts of the local community so they would fund his mission: To make a difference to the lives of identified groups, marginalized communities and individuals. Strømme Foundation still wants to bring forward his legacy, through a professional operation.
SF aims at strengthening civil society by establishing and empowering Community Based Organisations, Community Managed Micro Finance, Speed Schools, clusters, women’s associations, Shonglap and Samvad (adolescent dialogue groups) networks. (For details see report)
We understand rights-based development as a locally owned, participatory process of empowerment, in which right-holders actively claim their rights from the respective duty-bearers. In the course of this process, right-holders gain increased control over their lives, and better control over the uneven power balance that keep them from seeing that their rights are contested.
This report represents numeric successful achievements in 2015. We have reached out to more than 660.000 rights holders. Whilst the number that we reach is important, an important criterion for success is that we reach them in the right way: impacting them to achieve sustainable hope for a decent livelihood and an end to poverty.
Development is achieved when people’s rights are respected, promoted, and acknowledged by those who are responsible for it. Thus, to ensure sustainability, Strømme Foundation – through interaction with civil society – seeks to anchor our programs with the respective governments of the countries where we operate.
Strømme Foundation has been successful in receiving support both from national and international institutions, as well as from large business corporations. We are very thankful for this support as it is one of the main reasons why we have been able to scale up our successful programs. We have increased our total income by approximately 12%. It is important to point to the fact that we have been able to turn around the trend of losing individual donors, to increasing the numbers. Whether our funding comes from corporate or individual support; it is personal passion, involvement and a belief in a World Free from Poverty that is the backbone of Strømme Foundation!
In presenting this annual report of achievements in 2015, we forward our thanks to you all, and we express our gratitude like many airlines: “Thank you for choosing this airline, we do know you have a choice.” Therefore, thank you for choosing Strømme Foundation. We hope to see you “on board” as we together continue to work towards a World Free From Poverty!
Øyvind Aadland Secretary General
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
3
International department – Strengthening civil society and quality education
In 2015, the International Department and Regional Offices continued to work closely with our partners to support local communities and families moving out of poverty by strengthening our programmes in education and microfinance. To achieve sustainable change, Strømme Foundation (SF) is working to embed our rights-based approach across the organisation and ensure that our cross-cutting issues; gender equality and inclusion are systematically integrated into programmes in all regions. Increased access to sustainable income sources To move out of poverty, families need a secure and stable income. This requires technical and vocational skills, the ability to organise, and access to savings and credit facilities. In Asia, SF worked with self-help groups and community-based organisations (CBOs) from disadvantaged communities to define and lead their own development efforts. In Sri Lanka, 109 CBOs worked in collaboration with the government to secure the basic rights of their members and their community, while in Bangladesh groups succeeded in securing additional government services. To improve the income of the CBO members, SF has provided technical training and supported the formation of production groups to enable members to reap the benefits of collective production. The interventions are starting to bear fruits as 21% of families in Sri Lanka and 24% of families in Nepal have crossed the poverty line thus far. In South America, SF’s work to improve communities’ access to income also has a strong social protection dimension. In Peru, for example, Women’s Entrepreneurship Associations have
helped vulnerable women from indigenous communities to access vocational training and improve their income, while at the same time raising awareness about domestic violence and providing support and advice for women who have been victims of such violence. Gaining financial independence helps affected members to make positive changes in their lives and to protect themselves and their children. Results from 2015 show that SF’s efforts to ensure that also the poorest and most marginalised groups have access to savings and credit facilities are tapping into a real demand in East and West Africa. More than 160 000 people, the large majority of whom are women, were involved in the community-managed microfinance programme (CMMF) in 2015. Through the savings and loans groups, the members are able to invest in their income-generating activities and provide for their families’ needs. However, reports are showing that CMMF is also having an impact beyond individual households. In East Africa, for example, many groups have an education fund that they use to support local primary schools and ECD centres with para-teachers and food. In fact, according to an external evaluation of groups in Uganda “at least 50% of the groups were involved in a relevant community development project in their community.” In East Africa and Asia, SF’s institutional microfinance operations reached 179 196 people in 2015. According to an external impact study of approximately 1,000 microfinanceclients in Uganda, 99% of households are able to meet their food requirements and 86% of clients own a home. In Asia,
17 years of abuse is enough. Now I feel strong enough to fight alone for my children and not to fear the rejection of the community for being a single mother” Women’s association member
4
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
two entrepreneurship focused products enabled clients to employ 3,233 family members and 4,371 members of their community to assist with their business. Access to credit and saving is important for job creation, but so is literacy, numeracy and technical skills – particularly for young people. 60% of young people living in developing countries are not in work or education. Technical and vocational training for this group is expanding in across SF’s regions and 1566 young people took part in such programmes in 2015. Vocational training is also a key component of the Shonglap/ Samvad programme in Bangladesh and Nepal, which aims to empower adolescents from marginalised groups. Of the participants in Nepal, 86% have improved life skills and good practices, 91% demonstrate improved self-esteem and 83% report reduction in cases of trafficking, early marriage and caste and gender-based violence.
In South America, SF’s education interventions are aimed at indigenous communities. In Peru, SF worked with local partners to roll out the Intercultural Bilingual Education (IBE) methodology in the Apurimac region in the Andean highlands in 2015. This methodology, which adapts the school curriculum and teaching style to indigenous languages and cultures, significantly enhanced the performance of Quechua children in school. The objective is to extend the methodology to all districts of the province and to facilitate its institutionalisation within existing local government structures. To date, 97 pre-Primary and Primary schools in 7 districts have started implementing IBE.
Ensuring quality education for disadvantaged groups Being able to read, write and calculate can provide the first steps out of poverty. SF’s education programmes target disadvantaged groups, ethnic minorities and indigenous groups. In South Sudan, SF supported 620 Primary Schools to enrol and keep 41,539 girls in school in 2015 through the Girls’ Education in South Sudan (GESS) project. The retention rate for the project is now 97%, which is remarkable for a country with so many challenges. In West Africa, where a large proportion of children are still out of school, the Speed School programme provides a second chance to access education. An external impact evaluation, published in 2015, found that former Speed School students are rapidly catching up with their classmates in terms of both their Math and French skills. The study, which was carried out over the course of the 2012-14 school years, also found that former Speed School students receive roughly the same grades as their classmates once they transfer to formal school. 20,803 children were enrolled in the Speed School programme in 2014-15, of which 5,488 learners were in centres funded by SF.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 4
5
Support to projects 2015 by country and thematic goal including distributed regional office capacity building Figures in NOK
GLOBAL Education
Microfinance
Act Now Mimeta Myrada - FK Other 476 487 Global 0 476 487
Capacity Building Advocacy
Social protection
2 581 867 500 000 848 611 603 960 4 534 438 0
Total
No. of Partners
2 581 867 500 000 848 611 1 080 447 5 010 926
1 1 1 3 Figures in NOK*
WEST AFRICA Education Mali Burkina Faso Niger West Africa
9 560 280 5 384 619 6 217 623 21 162 522
Microfinance 2 768 929 2 089 406 1 727 379 6 585 714
Social Total No. of Capacity Partners Building protection Advocacy 2 274 022 68 120 14 671 351 4 1 006 005 46 912 8 526 942 4 1 514 828 48 043 9 507 872 3 4 794 855 163 075 32 706 165 11 Figures in NOK*
NIGER
MALI
BURKINA FASO
PERU BOLIVIA
SOUTH AMERICA Education Peru Bolivia South America
4 072 198 1 864 482 5 936 680
Microfinance 1 443 366 107 233 1 550 599
Capacity Building Advocacy 794 423 798 168 1 592 592
Social protection
Total
1 438 280 3 307 328 4 745 608
7 748 267 6 077 211 13 825 479
No. of Partners 6 5 11
Figures in NOK* *) ex. numbers of partners
6
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Total
Education
Microfinance
Capacity Building Advocacy
Social Protection
78 233 798
24 827 138
24 815 582
10 365 983
Grand total - support to projects in 2015
NOK
Total
No.of partners
138 242 501
79
138 424 501 208 341 660 833
Number of right-holders under 18 years Total number of right-holders
ASIA Education Sri Lanka Nepal Bangladesh Myanmar Asia
1 902 363 10 891 830 9 784 013 0 22 578 206
Microfinance 2 452 957 1 842 042 3 146 748 1 756 193 9 197 939
Capacity Building Advocacy 2 551 751 2 577 326 3 089 458 416 086 8 634 621
Social protection 562 587 1 589 455 399 346 330 580 2 881 969
Total
No. of Partners
7 469 658 16 900 653 16 419 565 2 502 859 43 292 735
6 10 6 2 24
Figures in NOK*
NEPAL
MYANMAR
BANGLADESH
SOUTH SUDAN UGANDA
SRI LANKA
KENYA
TANZANIA
EAST AFRICA Social Total No. of Capacity protection Partners Building Advocacy Uganda 4 244 204 3 186 548 2 126 649 1 422 211 10 979 611 12 Tanzania 2 578 020 1 529 873 357 414 165 325 4 630 632 5 Kenya 3 334 271 669 736 1 380 917 127 344 5 512 267 4 South-Sudan 18 399 894 1 630 243 1 394 096 860 453 22 284 686 9 Sudan 0 0 0 0 0 0 East Africa 28 556 389 7 016 399 5 259 076 2 575 332 43 407 196 30 Education
Microfinance
Figures in NOK* *) ex. numbers of partners w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
7
Communication and Fundraising
A Good Year for Communication and Fundraising 2015 ended with a total of NOK 82.2 million raised. We are pleased, and would like to thank all our donors, partners and staff for making this possible. Strømme Foundation is honoured by the extraordinary generosity of our donors and partners who provide financial resources for our programmes around the world. 2015 turned out to be a good fundraising year for Strømme Foundation. The result is NOK 7.5 million higher than the year before. We raised NOK 10 million above budget. Major donors were the main reason for this. With an increase of NOK 6 million from 2014, this was a historically good year. The positive trend of increasing the number of fixed term donors towards the end of the year continues. This remains the focus and main goal for us, and it is very gratifying to reach it. Recruitment of Private Donors A major event for Strømme Foundation was the “Jobbskaper” (Job Creator) campaign in September. In 2015, we decided to follow up the campaign held the previous year in Rogaland. The campaign aims to secure fixed-term donors, as well as promoting our work in the local community. 2015 proved to be a tougher time, with several competing organisations in the same vicinity at the same time, not to mention the financial
challenges in the area at the time. The result was 339 new fixed-term donors, which is less than we anticipated. We are, however, pleased with the publicity and enthusiasm for our work that we received in the area. At this year’s fundraising conference for the whole industry, Strømme Foundation won the title Fundraising Campaign of the Year 2014. Up against Plan and Blindeforbundet (The Association for the Blind), this was a great honour. It is encouraging to know that the “Jobbskaper” concept is noticed and applauded by other organisations. The earthquake in Nepal made the department mobilize. We managed to initiate a fundraising campaign (sms, ads on the web and in social media) very quickly, within 4 hours of the management’s decision to go ahead. We managed to be in the media on 25 occasions (newspapers, radio, TV) through interviews and opinion pieces, which also helped boost our campaign. We raised NOK 2.450 820 million for relief funds and long-term rebuilding-funds for our projects in Nepal. The competition in the market for child sponsorship programmes is still tough, but nevertheless we are pleased to see that we maintain our position. We have changed how we communicate our “Friend at Heart” donor programme, from focusing on one project to speaking about all the children in our programmes. This gives us greater flexibility, and makes us less vulnerable towards changes. Last summer, we had good results from our summer recruitment campaign, with 397 new donors recruited. This work was led by former Act Now students, and they have also been great ambassadors for our organisation throughout the summer. Major Donor Our work towards the corporate sector and trusts continues with vigour. The loyalty and enthusiasm we experience from our partners is very encouraging. An important part of our work aimed at adolescents is the close collaboration with schools and Folk High Schools. We have worked closely with many of these schools for years, and we see a high level of commitment among pupils, students and teachers. A new activity this year has been a collaboration with Skjærgårdsgospel’s 24 Hour Festival. Together we have established a collaboration that will promote SF, raise funds and recruit donors in various arenas in 2015/16.
8
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Category 2015 2014 Public Sector Grants 80 132 70 945 Grants from other Organisations 21 450 17 385 Individual Donations 8 171 8 665 Fixed Term Donations 39 485 38 362 Corporate Sector 18 279 11 438 Schools, events etc. 4 091 3 320 Legacies 1 938 5 164 Financial Income 12 851 3 696 Other Income 1 329 7 343 Natural disaster and rehabilitation 2 451 TOTAL 190 177 166 319
SF Income 2015
NOK 1000
Legacies 1938 Schools. events etc 4091
Financial Income 12.851 Other Income 1329
Natural Disaster & rehabilitation 2451
Corporate Sector 18.279
Fixed Term Donations 39.485
Individual Donors 8171
Grants from other Organisations 21.450
Public Sector Grants 80.132 NOK 1000
Media & Public Relations One of Strømme Foundation’s main objectives in Norway is to help increase awareness of development issues. In the media, and in general, international development work does not reach headline status. We aim at being a voice for the poor and oppressed, and to raise our voices on their behalf when needed. In order to gain the media’s interest in development and issues related to poverty eradication, we work strategically to place such issues on the agenda. Press releases, debates, opinion pieces and feature articles, interviews and social media are among some of our chosen approaches to gaining access the public. Our media coverage in 2015 includes 25 opinion pieces and debates in different local and national newspapers. Altogether, these articles have been published 43 times. Thematically they focus on such issues as the importance of education and job creation when fighting poverty. Strømme Foundation’s staff were interviewed for 34 different articles in 2015. The main topics in the interviews included radicalisation in West Africa, child marriage, and the earthquake in Nepal. Regarding the earthquake, we focused on the vulnerability of young boys and girls and the increased danger of kidnapping and human trafficking.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
9
Great things can happen when many share one common vision! In Strømme Foundation our Vision is:
A World Free From Strømme Foundation is inspired by the Christian view of God´s creation and the absolute dignity of man. We strive to approach people with openness and respect, regardless of religion, ethnicity, caste, gender, disability or other minority status. Strømme Foundation is committed to empowering people so that they overcome the root causes of poverty.
In Strømme Foundation our Mission is:
To Eradicate Poverty With a deep respect for human dignity and conviction about the value of equitable partnership, Strømme Foundation works to empower the poor so that they take charge of their own lives and communities. We strive to facilitate change, not only by providing material needs, but also by creating opportunities for people to utilise their talents in a value-based development process. Strømme Foundation works through local partners and through two intervention approaches – microfinance and education. A major focus for our work is to facilitate for people so they can create their own jobs.
Our Values Human Dignity We believe in the inherent, inalienable rights of every individual. At Strømme Foundation, this is considered to be the most important human right from which all other fundamental human rights are derived.
10
Justice We have a drive to fulfil not only legal, but also social rights of communities and individuals in creating a more just distribution of society’s r esources and power.
Solidarity We identify empathically with the plight of marginalised and discriminated groups.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Poverty
Microfinance and Community Managed Microfinance (CMMF) Microfinance creates access to sustainable income sources and provides a means by which the poor can act upon their decisions. The focus here is to provide access to financial services such as loans, places to save, insurance etc. Capacity building of the participants and clients is also an important component of the programmes in question. The microfinance intervention will use the methods of both institutional MF as well as CommunityManaged Microfinance.
Education
Education helps people develop the attitudes, skills and knowledge needed to make informed decisions concerning the development of themselves and their communities. Our main focus is on facilitating poor children at risk by strengthening the fostering environment within the local community. Interventions are carried out within primary education, adult literacy, vocational skills/life skills and awareness building, and with a special and paramount focus on education for girls.
Cross Cutting Issues Gender Equality SF strives to promote equal rights and opportunities both for women and men to share in the socio-political and economic order.
Environmental Sustainability SF seeks to mainstream environmental awareness, climate change mitigation and adaptation into existing programmes.
Inclusion SF promotes the inclusion, non-discrimination and empowerment of marginalised groups, including people marginalised by disability, ethnicity, caste and other minority statuses.
w w w . s t r o m m e . o r g \ S T R Ă˜ M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
11
Anti-Corruption Report 2015
Strømme Foundation is working in some of the most corrupt countries in the world. In line with its zero tolerance for corruption and financial principles, it is compulsory for anticorruption to be integrated as part of regular project and partner management.
of the organisation, but they failed to take further action. SF has reported the case to the police as well as the anti-corruption court in Uganda. The case is thus pending in the legal system. Meanwhile, SF has repaid to NORAD a total of NOK. 76.888, representing NORAD’s share of the misused funds.
The anti-corruption strategy consists of three phases: prevention, detection and investigation. The prevention work is the most important, with regular training and sensitization of own staff as well as partner staff. In 2015, a new training session for partner Board Chairpersons was developed and rolled out in Uganda as experience has shown that Board Chairpersons do not always take their expected position when it comes to fostering transparency and accountability and taking an active role in legal proceedings.
Case Kenya: A partnership was terminated with a new partner implementing a long-standing program. In this case no funds had been misused but SF’s Partner Assessment Tool and regular project and financial monitoring visits showed that the partner consistently demonstrated poor results when it came to sound financial management. As a preventive measure, the partnership was terminated in 2015.
With regards to detection, Strømme Foundation has experienced that effective whistle-blower channels as well as regular and robust monitoring and follow up are tools that give results, and will therefore focus more on developing and applying these tools. Strømme Foundation has further engaged KPMG to carry out an independent analysis of Strømme Foundation’s anticorruption routines, with suggested improvements. This work is underway. The last phase, the investigation phase, is carried out by external resources. In certain cases, external auditors have been engaged. In cases where there is suspicion that a criminal act has been committed, the case is handed over to the national police for further investigation and action. In 2015, Strømme Foundation experienced corruption cases that have been both challenging but also an opportunity to learn and improve. Below, we have given a brief overview of each case: Case Uganda: A whistle-blower reported to SF that there was a need for an investigation into one of our longstanding partners as there was a suspicion of misuse of funds. SF initiated a special audit which revealed the misappropriation of project funds (unaccounted funds utilised for private use). The total amount of unaccounted funds in 2014 and 2015 was NOK. 576.328. The following things were discovered: production of fictitious receipts, conspiracy between staff and suppliers, and pay slips manipulation. According to the audit report, it was discovered that the executive director of the organisation was responsible for situation. The case was presented to the Board
12
Case Bangladesh: Through whistleblowing, it was revealed that project staff within a partner organisation carried out a “savings scheme”. The scheme consisted of increasing costs on existing invoices, and taking out the funds for other purposes within the organisation. The partner organisation initiated an internal audit. In addition, SF commissioned a local audit as well as an audit conducted through the Norwegian Office. A total of NOK 15.000 was documented as misused. 3 staff contracts were terminated, and SF is renegotiating the partner contract to ensure more robust financial training and increased follow-up of financial management. Case Uganda (2): In response to the findings from programmatic and financial monitoring of one of SF’s partners, a special audit was carried out. The audit report concluded that the partner had weak internal control systems, poor filing systems and weakness in budget controls and financial management but no confirmed corruption. As considerable resources had already been invested in training and capacity building, without significant results, the partnership has been terminated. Overall, the processes and methods employed in the cases above, indicates that SF has internal and external controls that are effective and working. Training, routines and controls can always be improved and SF puts a significant emphasis in learning from each case. In certain cases, legal proceedings follow investigations. Strømme Foundation’s approach is to make all relevant material available, and hand the case over to the prosecution authorities in the relevant country for further legal proceedings. The experience we have had in this phase has demonstrated several challenges:
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
• • • • •
Slow legal processes and the fact that associated costs are not usually anticipated have made expeditious disposal of cases difficult. Corruption within the legal systems makes follow up of cases challenging as files get lost, charge sheets are debated endlessly and there is often a lacking drive to finalise cases. Protection of whistle blowers and witnesses from harassment has proved problematic with negative effects on concluding cases expeditiously. High staff turnover of our partners has resulted in the need for constant refresher training to keep partners current with SF’s anti-corruption rules and the wider anti-corruption agenda. Involvement of the board in the management of organisation compromises the boards effectiveness in combating corruption.
In addition to working to prevent corruption within its partners and programmes, SF is increasingly working to ensure that the communities where SF is operating are aware of, preventing and taking action against corruption in society. Specifically, elements of anti-corruption are integrated into a number of SF’s programmes. As a result, a range of corruption cases have been identified and resolved. In Nepal, for example, a forum representing CBO and Shonglap members took the initiative, with government support, to carry out a public audit of a school and local market development project. The audit revealed that the contractor and president of the user committee had misappropriated funds. Both have since returned the money. Similarly, in Uganda the Parent Teacher Association in an SF-supported government school successfully lobbied local authorities to replace the Head Teacher, deputy and several teachers that were consistently tending to their crops during school hours. As a result, the previously weak performing school has seen its enrolment rates double.
Strømme Foundation will focus on mitigating these challenges in 2016.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
13
Mimeta
Mimeta’s vision is to contribute to free access to the arts for everyone. We see this as a universal human right, which is not to protect a culture, but to protect the individual who wants to enhance, modify or destroy it through her aesthetic or intellectual capabilities. Mimeta supports local and regional service providers of the arts. Thus, Mimeta gives priority to organisations from civil society that work on behalf of the arts to improve the sector’s position on rights issues, and to secure a backbone of arts and culture in times of societal crisis and transition. Mimeta is a part of good functioning networks for development processes, support and re-granting both in the Arab-speaking world and in Sub-Saharan Africa. From our 15 programmes in 2015, we wish to highlight Artwatch Africa. This Arterial Network project has made a significant impact in increasing levels of awareness amongst artists, arts activists, and the general public, and has already become a reference point for such issues in arts circles in Africa and beyond - through capacity-building workshops, seminars and advocacy through arts awareness-raising programmes. Artwatch Africa reported 15 cases of violations during 2015 and led campaigns when youth activists and artists were arrested in the DRC and when Studio Abazon was shot and burnt by security forces in Burkina Faso. Artwatch Africa was involved in Cultural Policy development processes with governments in Zimbabwe, South Africa, Gabon and Ivory Coast. The 3-day workshop series Artist Rights as Human Rights reached 175
14
participants in seven countries: Kenya, Rwanda, Morocco, Ivory Coast, South Africa, Swaziland andMauritania - and another ten seminars were organised covering artist rights, freedom of expression and copyrights. As a principal tool to communicate artist rights and freedom of creative expression, the Advocacy Through the Arts programme included: • • • • • •
Painting workshop and exhibitions in Mali, cartoon exhibitions in DRC, Poetry workshop in Zambia. Presentation of Artwatch Africa Film Awards at Luxor African Film Festival and Durban International Film Festival for films engaging with issues of freedom of expression, human rights and social justice. Presentation of Artwatch Africa Achievement Award to rapper Didier Awadi in Yaounde. Production of the «Droit de vivre » (Right to Life), song by Artwatch Africa Ambassadors, involving 13 rappers and singers from 11 West African countries, a workshop, music recording, concerts in Ouagadougou and Lagos attended by more than 2000 people, launches of a music video in Oaugadougou and Lagos. The song was broadcast in the UK, Germany, Mali, Burkina Faso and Nigeria, with more than 10,000 views on YouTube. « Droit de vivre » has been nominated for the Index on Censorship Freedom of Expression Art Award. Production of three Artwatch Africa videos in 2015. Commissioning of 14 essays and articles to add to 9 commissioned in 2014. Translation being finalised for pro duction of an e-book plus a limited print-run of hard copies.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Other programmes
............................................................................................................................... Fredskorpset (FK-Norway) Strømme Foundation has in 2015 been engaged in all the three main programmes operated by FK-Norway: the South to South programme, the youth exchange programme and the North to South programme. The South to South programme has this year been headed by the Regional Office in East Africa. Partner staff have
interchanged between the two countries: India and South-Sudan. The youth exchange programme Act Now is run by Hald International Centre in Mandal, Norway. Strømme Foundation also participated in the FK-Norway programme for persons under the age of 35. This programme emphasises the exchange of skilled and experienced peeople who are able to work directly with our local partners and their staff. In 2015 we had two people from South Sudan working in Kristiansand, and two from Norway working with one of our partners in South Sudan. Strømme Foundation maintains a close collaboration with FK-Norway, and we see these programmes as an instrument for dialogue for cross-cultural communication and understanding. FK Exchange Programme 2015 is the last year of the three-year exchange programme between South-Sudan and Norway. Participants have been active in skills training and with administrative activities in these projects. The South Sudanese participants plan to start a bakery business back in South-Sudan.
............................................................................................................................... Youth Exchange Programme ACT NOW
Hald International Centre is a school owned by the Strømme Foundation, the Norwegian Missionary Society and Laget (NKSS). The school offers a one-year study programme in CrossCultural Understanding and International Work. Our exchange programme Act Now is for youth between 19 and 25 years old. The curriculum is a mixture of theory and practice. All students have a 6-7 month placement with a partner organisation related to each organisation’s work.
Act Now aims to give young people “a year of another world”, offering them a chance to explore, learn and give back some of the knowledge attained from living in a new and different culture.
The programme is one of the Fredskorpset (FK) Volunteers partners. Students are offered an academic approach to topics such as global understanding, development aid, combating poverty, culture and the environment. However, the main focus for the study is the internship of six to seven months within one of Strømme Foundation’s partner organisations. Through Act Now, we want to facilitate a greater understanding of the concept of poverty. Our students learn about development and gain knowledge and understanding about another reality first hand, by living in the context where they work.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 4
15
Annual Report The Strømme Foundation Board of Directors 2015
Strømme Foundation (SF) works to enable people to overcome the root causes of poverty. SF’s identity is based on Christian values as they are expressed in the life and teachings of Jesus Christ. SF plays a catalytic role in enabling marginalised groups to meet their basic needs themselves and gain access to resources and decision-making organs. Thus, SF works to promote a more just society.
One of the major focus areas for SF in 2015 was the Speed School programme in West Africa. This programme aims to prepare and transition out-of-school children into formal schools. During the year, SF successfully worked to both streamline and scale up the programme. As a result, new funding contracts have been signed and several major donors have shown strong interest.
SF has its coordinating/facilitating office in Norway (Kristiansand) and four regional offices in West Africa (Mali); East Africa (Uganda); South America (Peru) and Asia (Sri Lanka), plus six country offices in South Sudan, Bangladesh, Nepal, Myanmar, Burkina Faso and Niger.
“Shonglap,” which means “Dialogue”, is a programme originally developed in Bangladesh. This programme has been further developed and replicated in other countries and regions where SF operates, and is well suited for further upscaling. The goal is to empower adolescent girls to both have more control of their own lives and become active members of their communities.
The Board The Board has had four ordinary board meetings in 2015 and dealt with 42 issues. The Board members who served during 2015 were; Svein Ove Faksvåg (chairperson), Torill Selsvold Nyborg (deputy chairperson), Knut Vollebæk, Lars Saaghus, Anna Minj, Hege Wallevik and Ansgar Gabrielsen. Substitute members were; Trond Backer, Jostein Senumstad and Cecilie Wathne. Strategic Planning SF’s mode of operation is unique in our combination of a decentralised structure and our partnership model, which ensures that the solutions to poverty are locally defined and always tailored to the local context. SF also seeks to strengthen civil society by facilitating our partner networks to influence government policy through conducting more direct advocacy work towards the Government(s), and building the capacity of partner organisations to undertake such advocacy in our intervention countries. SF also wants to carry out political lobbying in Norway and internationally, in order to fight poverty. To the greatest extent possible, SF seeks to raise funds that will increasingly facilitate a move from implementing isolated projects to a more integrated and long-term programme approach. This necessarily demands a thorough integration of funding in programming work, and vice versa.
16
With regards to fundraising, SF has continued to promote the “Job Creator” concept – a concept that has proved to be popular and well-received. In addition to regular activities, SF has also carried out a major campaign in the Stavanger region in 2015. The work with Business Partners has also had solid progress in 2015.
Financial Headlines Strømme Foundation The total income in 2015 was 190.2 m NOK compared to 166.3 m NOK in 2014. Public sector income increased from 70.9 m NOK in 2014 to 80.1 m NOK in 2015, mainly due to increased support from Norad. Private donations have increased from 55.5 m NOK in 2014 to 56.1 m NOK in 2015. Income from business partnerships also showed an increase from 11.4 m NOK in 2014 to 18.2 m NOK in 2015. Contributions from other organisations increased from 17.4 m NOK in 2014 to 21.5 m NOK in 2015. Financial support to purpose activity increased from 124.4 m NOK in 2014 to 154.7 m NOK in 2015. The result for the year after change in earmarked capital was a surplus of 12.4 m NOK, compared to a surplus of 13.4 m NOK in 2014. Other purpose capital in SF is now 64.9 m NOK.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Consolidated Accounts There was a consolidated surplus of 30.2 m NOK compared to 36.2 m NOK in 2014. Total equity increased from 227.6 m NOK in 2014 to 257.4 m NOK in 2015. The cash flow from operational activities is satisfactory. Total liquid funds at the yearend incl. Mimeta was 75.9 m NOK compared to 67.4 in 2014. This excludes Strømme Micro Finance AS (SMF AS) that has been consolidated using the equity method. Liquid funds in SMF AS group totals 32.4 m NOK. The key figures for SF as a percentage of total costs in 2015 were: Administration 4.5 % (4.6 % in 2014); Fundraising 10.1% (12 % in 2014); and Purpose 85.4 % (83.4 % in 2014). In addition, the Norwegian Fundraising Control Board has introduced a measure of the amount of private funding that goes to purpose costs which is 75.4 % (73.6 % in 2014). SF is following the guidelines given from the Norwegian Control Committee for Fundraising regarding definitions of administration, fundraising and purpose. Working environment and staff The working environment in the SF is considered to be good. The cooperation with the employees’ unions has been constructive and has contributed positively to the development work. In the period 15th of February to 15th of June, Kristine Storesletten Sødal acted as Secretary General on behalf of Øyvind Aadland who was granted a leave of absence for the purpose of study. In 2015 there were 4 men (4 in 2014) and 3 women (3 in 2014) on the Board. Among the employees in the Kristiansand office at the end of the year, there were 13 women (13 in 2014) and 17 men (18 in 2014). In the regional offices there were 32 women (27 in 2014) and 66 men (64 in 2014). On the leadership team, comprising the senior managers in the Kristiansand office plus the regional directors, there were 3 women and 5
men. SF strives for a balance of gender at all levels and is conscious about this when employing new staff. Absence due to illness in the Kristiansand office was approximately 1.6 % (2.8 % in 2014) of the total working time. The organisation has a company health service agreement. There were no serious accidents at work resulting in material damages or personal injuries during the year. The organisation’s pollution of the external environment will mostly be of an indirect nature. The Board considers SF to have a minimal pollution effect on the external environment. The organisation has no order from the public authorities that has not been complied with. Strømme Foundation has an international staff, and recruitment processes and working environment in all offices are intended to ensure that there is no discrimination on the grounds of race or disability. Risk Perspective The Board continues to monitor SF’s risk through quarterly reporting. Focus on this has continued during 2015 on deviation reporting to the Board and on preventing corruption in SF and its partners. The organisation has established good systems and had good dialogue with donors when suspected corruption cases are uncovered. The security situation has been challenging in Mali, Niger, Bangladesh and South Sudan in 2015. In the northern part of Mali, it has not been possible for staff to travel due to the security situation. Still it has been possible to work with partners in the different areas as planned. The regional office in West Africa is well updated on the security situation in all three countries and makes good and safe plans for both local and Kristiansand staff traveling in the region. For South Sudan, the political situation is still challenging. In the main area where Strømme Foundation operates, things are functioning and activities with partners have been as normal. The Juba office is well updated and has close contact with
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
17
local partners, the Norwegian Embassy and UN organisations on security matters. Staff from the regional office and Kristiansand have been traveling without major problems during the year due to good planning and continuous updates on the current situation. The political situation in Bangladesh was tense in parts of 2015. This has affected activities to some extent, but the country office still managed to carry out most of the planned activities. SF operates in countries, which are affected by natural disasters occasionally. In 2015 Nepal was struck by a devastating earthquake, which affected parts of our programmes and our country office. We experienced no casualties or injuries related to staff or their families in this incident. SF’s expenditure is largely in currencies linked to the US dollar or the Euro, and with most income in Norwegian kroner, exchange rates play a large part in what SF is able to deliver to partners in the South. However, given the nature of SF’s agreements with these partners, our exposure is limited to the Norwegian kroner budget. In 2015 SF has entered into fixed exchange rate contracts in order to secure the budgets at a favorable exchange rate between the Norwegian kroner and the US dollar and Euro. Strømme Foundation has no external borrowing, so there will be no serious consequences for the organisation if the interest rates should increase considerably. The credit risk is restricted to the microfinance operations of SMF AS.
Microfinance operations are exposed to credit risk and country risk. Due to the monitoring system and diversification of the portfolio, the Board believes that the credit risk is reduced to an acceptable and manageable level. The specific country risk cannot be influenced directly by the company, but the sum of country risks has been reduced through the company’s strategic decision to spread its activities over several countries. Future Perspective SF has clear plans to continue its work of empowering poor communities to climb the ladder out of poverty. The need is clear and urgent, and the organisation is in a good position to make a substantial impact. The Board has good reason to believe that Strømme Foundation is a going concern. The results from 2015 show steady growth in regular income. SF is in a good position to respond to changes in the market for funds, whether they come from competitors or from general economic circumstances. Allocation of the result Out of SF’s overall surplus of 11.4 m NOK, 0.9 m NOK is transferred from the restricted purpose capital, and 12.4 m NOK is transferred to other purpose capital. The consolidated accounts show a net surplus of 30.2 m NOK, of which 17.8 m NOK is added to restricted purpose capital and 12.4 m NOK to other purpose capital.
Kristiansand, June 17th 2016
Hege Wallevik Board Member
Anna Minj Board Member
Ansgar Gabrielsen Board Member
Svein Ove Faksvåg Chairperson of the Board
Hans Christian Vadseth Board Member
Knut Vollebæk Board Member
Lars Saaghus Board Member Øyvind Aadland Secretary General
18
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Strømme Foundation Activity Accounts Note
Strømme Foundation 2015
Strømme Foundation 2014
Consolidated 2015
Consolidated 2014
Funds acquired
Public sector grants 3 80 131 531 70 945 463 83 554 479 75 137 909 Grants from other organisations 4 21 450 000 17 385 064 21 450 000 17 615 738 Private donations 5 56 136 426 55 510 934 56 136 426 55 510 934 Corporate sector 6 18 279 210 11 437 809 18 279 210 11 437 809 Gain from sale of property 17 - 6 805 004 - 6 805 004 Financial income 7, 27 12 850 807 3 696 252 12 878 906 3 663 345 Other income 1 329 386 538 255 1 329 386 567 104 Total funds acquired 190 177 360 166 318 781 193 628 407 170 737 843 Funds spent Cost of fund acquisition Direct fundraising cost 8 -13 988 528 -14 192 765 -13 988 528 -14 192 765 Other fundraising cost 8 -4 411 731 -3 823 422 -4 772 400 -4 394 020 Total cost of fund acquisition 1 -18 400 259 -18 016 187 -18 760 928 -18 586 784 Purpose cost Support to development partners 9 -109 422 987 -80 241 194 -106 726 670 -77 041 982 Disaster response 10 -1 303 887 - -1 303 887 - Program follow up at regional offices 11 -27 515 626 -24 068 600 -27 515 626 -24 068 600 Program follow up from Kristiansand 12 -10 887 368 -12 462 648 -10 858 706 -12 103 842 Information and public education 13 -5 575 630 -7 644 463 -5 575 630 -7 644 463 Project support - Mimeta -2 618 782 -2 958 226 Total purpose cost 1 -154 705 497 -124 416 904 -154 599 300 -123 817 113 Administration cost 1 -8 089 722 -6 789 764 -8 450 391 -7 360 361 Total funds spent 1, 24 -181 195 478 -149 222 854 -181 810 619 -149 764 258 VAT compensation 14 2 450 300 2 462 545 2 450 300 2 462 545 Result Microfinance (MF) -369 542 571 075 The year’s activity result 11 432 183 19 558 471 13 898 547 24 007 205 Hereof minorities’ share (Mimeta) -38 644 -112 544 Additions/reductions in purpose capital Change in purpose capital with restrictions (SF, Mimeta, Other companies) 15 B -930 137 6 125 611 -1 410 090 2 972 631 Change in purpose capital with restrictions (Microfinance) - - 19 214 756 19 812 856 Transferred to / (from) other purpose capital 15 12 362 320 13 432 860 12 362 320 13 432 860 Total additions/reductions in purpose capital 11 432 183 19 558 471 30 166 986 36 218 347
Strømme Foundation Balance Sheet 31.12.2015 Note ASSETS
Strømme Foundation 2015
Strømme Foundation 2014
Consolidated 2015
Consolidated 2014
Note
Long term assets Fixed assets Property 16 7 443 854 7 748 490 7 443 854 7 748 490 Office furniture and equipment 16 317 224 424 694 321 044 432 334 Total fixed assets 7 761 079 8 173 184 7 764 899 8 180 824 Financial assets Investment in subsidiaries 18 A 37 459 847 37 459 847 - - Investment in other companies 18 B 705 000 705 000 1 303 274 1 289 692 Investment in microfinance - - 182 328 736 163 342 552 30 Loan to subsidiaries 19 76 816 208 76 816 208 - - Total financial assets 114 981 055 114 981 055 183 632 010 164 632 244 Total long term assets 122 742 134 123 154 239 191 396 908 172 813 068 Receivables Trade Debtors 19 1 239 023 1 111 957 1 239 023 1 111 957 Inter company receivables 19 1 355 738 1 434 790 - - Other receivables 7 481 757 6 630 145 7 521 982 6 666 145 Total receivables 10 076 518 9 176 892 8 761 005 7 778 102 - - Investment in current financial assets 20 26 190 037 9 788 687 26 190 037 9 788 687 - - - - Bank and cash 21 48 735 318 56 152 666 49 751 932 57 605 611 Total current assets 85 001 873 75 118 245 84 702 974 75 172 400 TOTAL ASSETS 207 744 007 198 272 484 276 099 882 247 985 468
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
19
Strømme Foundation 31.12.2015 PURPOSE CAPITAL Note Strømme Foundation Strømme Foundation Consolidated Consolidated Note AND LIABILITY 2015 2014 2015 2014 PURPOSE CAPITAL AND LIABILITY Purpose capital (PC) Founding capital 3 326 092 3 326 092 3 326 092 3 326 092 - - Acquired purpose capital PC with restrictions (SF projects) 15 B 17 050 424 17 980 561 17 050 424 17 980 561 PC with restrictions (Microfinance) 106 882 512 106 882 512 140 903 705 124 964 196 Restricted equity (Mimeta) - - 410 101 481 867 Minority interests - - 220 823 259 467 Other purpose capital 64 912 448 52 550 128 95 477 213 80 538 118 Total acquired purpose capital 188 845 384 177 413 201 254 062 266 224 224 209 Total purpose capital 15 192 171 476 180 739 293 257 388 358 227 550 301 31 Liability Long term debt Pension obligations 22 840 591 080 840 591 080 Staff gratuities in regional offices 23 5 506 991 3 368 434 5 506 991 3 368 434 Legacy obligations 150 000 150 000 150 000 150 000 Other long term debt - - 3 799 243 3 416 119 Total long term debt 5 657 831 4 109 514 9 457 074 7 525 633 Short term debt Creditors 2 965 129 3 199 094 2 974 243 - Public duties & taxes 1 876 840 2 227 644 1 927 367 3 210 491 Owed to employees 1 989 813 1 938 970 2 070 564 2 283 019 Inter company debt 19 1 038 437 1 217 846 - 2 024 721 Deferred project income 1 812 140 4 806 700 2 042 844 - Other account payable 232 340 33 422 239 433 5 310 891 Total current liability 9 914 699 13 423 677 9 254 450 80 411 Total liability 15 572 530 17 533 191 18 711 524 20 435 167 - - TOTAL PURPOSE CAPITAL AND LIABILITY 207 744 007 198 272 484 276 099 882 247 985 468
Kristiansand, June 17th 2016
Hege Wallevik Board Member
Svein Ove Faksvåg Chairperson of the Board
Ansgar Gabrielsen Board Member
Anna Minj Board Member
Hans Christian Vadseth Board Member
Lars Saaghus Board Member
Knut Vollebæk Board Member
Øyvind Aadland Secretary General
20
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Strømme Foundation Cashflow 2015 (The indirect method) Note
Strømme Foundation 2015
Strømme Foundation 2014
Consolidated 2015
Consolidated 2014
The year’s activity result 11 432 183 19 558 471 30 166 986 36 218 347 Adjustment in Microfinans - - -19 315 114 -24 978 148 Share of result from other companies 369 542 2 831 427 Unrealised loss on investments, i.e. current financial assets - - - 43 583 Ordinary depreciation 16 408 402 467 447 412 222 545 191 Disposal of fixed assets 16 3 700 - 3 700 - Difference between pension cost and payments 22 -590 240 -166 820 -590 240 -166 820 Posts in the activity account without liquidity effect -178 138 300 627 195 224 3 253 381 Acquisition of fixed assets 16 - -387 093 - -387 093 Property development Lillesand 17 - 3 289 109 - 3 289 109 Changes in loan to subsidiary - -4 606 108 - - Changes in long term debt 2 138 557 612 312 2 138 557 612 312 Investments, disposals and financing 2 138 557 -1 091 780 2 138 557 3 514 328 Change in receivables/other current assets -899 626 -6 066 352 -982 903 -4 935 344 Change in creditors/other short term debt -514 417 1 872 511 -387 035 1 368 461 Change in deferred project income -2 994 560 2 656 700 -3 268 047 1 932 455 Other changes -4 408 603 -1 537 141 -4 637 985 -1 634 428 Total changes in liquidity during the year 8 984 002 17 230 177 8 547 671 16 373 480 Opening balance of cash and current financial assets 1.1. 65 941 353 48 711 175 67 394 298 51 020 819 Closing balance of cash and current financial assets 31.12 74 925 355 65 941 353 75 941 969 67 394 298 Specification: Investment in current financial assets 20 26 190 037 9 788 687 26 190 037 9 788 687 Bank and cash 21 48 735 318 56 152 666 49 751 932 57 605 611 Closing balance of cash and current financial assets 31.12 74 925 355 65 941 353 75 941 969 67 394 298
Accounting Principles applied The financial statements of the Strømme Foundation (SF) are prepared in accordance with the Norwegian Accounting Act and the “Accounting Standard for Not-for-Profit organisations”, produced by The Norwegian Accounting Standards Board. This means that, in place of a traditional Profit and Loss Account, there is an Activity Account which is meant to give the reader a better understanding of how Strømme Foundation has used the resources at its disposal. SF is not liable for direct taxation.
Allocation of costs THE PURPOSE OF STRØMME FOUNDATION IS TO LIFT PEOPLE OUT OF POVERTY BY: • Managing raised funds and public grants in a way that ensures that recipients gain real influence over their own situation through participation in the developmental process, to strengthen human dignity, and to stimulate the ability of recipients to help themselves. • Engaging in dissemination and awareness activities in a North-South perspective, with the aim to create increased interest in development through co-operation; and • Providing aid and assistance through local partner organisations and other regional organisations, in co-operation with local authorities. THE REGIONAL OFFICES Strømme Foundation has four regional offices; in West Africa (Mali); East Africa (Uganda); South America (Peru) and Asia (Sri Lanka), plus six country offices in Burkina Faso, Niger, South Sudan, Bangladesh, Nepal and Myanmar. The full cost of these offices is allocated as purpose cost. SUPPORT FOR PROGRAMME WORK FROM KRISTIANSAND Costs of the “International Department” are allocated to activity and thereby
purpose costs. The department’s function is to co-ordinate, support, evaluate and monitor all programme work, as well as liaise with public and institutional funding bodies such as NORAD, The Norwegian Peace Corps, Operation Dayswork, Läkarmissionen and Eriks Foundation. OTHER SUPPORT FUNCTIONS IN KRISTIANSAND These are comprised of “Secretariat of the Secretary General”, Administration, Finance and ICT departments. The basis of allocation starts with salaries, which are allocated according to an estimate of the amount of time spent on different activities. Costs that cannot reasonably and consistently be allocated to activity, are classified as administration costs. Thus, support costs relating to the Board of SF, audit costs, general memberships, consultancy, finance costs and about 60% of staff costs in the secretariat, administration and finance departments are classified as administration costs. Note 1 below shows in summary how the allocation has been made. FUNDRAISING AND INFORMATION All expenditure directly connected to personnel employed as fundraisers, and to solely fundraising activity, is classified 100% as fundraising costs. This includes all direct marketing costs and other costs associated with our main fundraising products, “Friend at Heart”,“Bridge-Builder”, “Poverty-fighter” and “Job Creator”. All expenditure on personnel and activity, the prime purpose of which is connected to information and public education, is allocated to purpose activity. TRANSACTIONS IN FOREIGN CURRENCY The conversion of the regional accounts from local currency to Norwegian kroner follows the prevailing exchange rates that are updated monthly in the financial system in common with the Kristiansand office. Accounting summaries from the offices still on separate financial systems is recorded monthly at rates corresponding to the fund transfer rates from Kristiansand or from grants received in the region. SF enters into forward exchange contracts in foreign currency to reduce the
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
21
currency exposure connected to money transfers abroad. The currency hedging is classified as securing of cash flow according to the NRS 18 “Financial assets and obligations”. From 2015 we have changed the method for recording gain and loss related to forward exchange contracts. From 2015 we record the realised gain and loss directly under financial posts relative to the market rate at the settlement date. These exchange rates serves as a basis for the transfers to the region and therefore affect programme costs in the activity accounts. Foreign currency income is in general recorded at the spot rate on the day of receipt.
SHARES IN SUBSIDIARIES AND OTHER COMPANIES Shares in subsidiaries and other companies are recorded at historic cost. SHORT-TERM INVESTMENTS Short-term investments (shares and bonds units considered to be current assets) are valued at the lowest of average procurement cost and actual value on the balance sheet. Received interest and dividend from the companies are entered as other financial income.
SF follows special guidelines concerning earmarked funds, which ensures that these funds cannot be used for activities other than those for which they were donated without specific approval. The Board has set regulations for the handling of earmarked funds when a project is closed. Unused earmarked funds are shown as purpose capital with restrictions in the balance sheet.
PENSIONS Pension costs and pension obligations are calculated according to the principle of linear earning based on estimated factors for the discount rate; future regulation of salary, pensions and contributions from Social Security, future earnings on the pension fund as well as the actuarial conditions concerning death rate, voluntary resignations, etc. The pension fund is valued according to actual value and is deducted from the net pension obligations in the Balance Sheet. Changes in the obligation due to changes in the pension plans are allocated over the expected remaining contribution period. The same applies to estimate deviations to the extent they exceed 10% of the greater of the gross pension obligations and the pension funds. Arrangements with net obligation are shown as liability and arrangement with net over-financing is shown as financial asset.
CLASSIFICATION AND VALUATION OF BALANCE SHEET ITEMS Current assets and short-term liabilities contain items due for payment within one year of acquisition. Other items are classified as fixed / financial assets or long-term liabilities.
CASHFLOW The cash flow is calculated using the indirect method. Cash and cash equivalents consist of cash, bank deposits and other short term liquid investments which can immediately be converted to cash without material exchange risk.
Current assets are valued at the lowest of procurement cost and actual value. Other accounts receivable are included in the balance sheet at face value. Items in foreign currency are valued at year-end exchange rates. Short-term liabilities are recorded at the nominal amount at the time of accrual.
CONSOLIDATION PRINCIPLES The consolidated accounts includes those companies where Strømme Foundation directly or indirectly has deciding influence. The consolidated accounts are prepared as if the group was one economic unit. Transactions and outstanding balances between the companies in the group are eliminated. The consolidated accounts are prepared according to uniform principles. Purchased subsidiaries are accounted for in the consolidated accounts based on SF’s procurement costs. The costs of acquisition are linked to identifiable assets and debt in the subsidiary, which is stated at actual value in the consolidated accounts at the time of purchase. Investments in microfinance are valued according to the equity method in the consolidated accounts. The equity method requires that proportion of the relevant companies result, reduced by depreciation on possible excess values, is charged to the activity account in the consolidated accounts. Both the purpose capital and the mother company’s lending to the microfinance activity are incorporated in the account line “Investments in microfinance”. Minority interests are shown as a separate post under the purpose capital. This means that assets and debt are stated inclusive of the minorities share. In the activity account, the minorities share of the result is calculated.
INCOME Income is entered in the accounts according to the gross method. Costs are entered as they accrue, and income when it is realised. Bequests or donations are recorded as income when there is indisputable confirmation of receipt.
Fixed/financial assets are valued at procurement cost, but are depreciated to actual value if the fall in value is not expected to be temporary. Long-term debt is entered at the nominal amount at the time of establishment. FIXED ASSETS The fixed assets are entered in the balance sheet and depreciated over their life span if the life span is more than 3 years and the cost is higher than NOK 50 000. Maintenance of fixed assets is charged to operating costs, while renovation or upgrading is added to the cost value and is depreciated along with the asset. At the regional offices all fixed assets are charged to result at the time of procurement. All leasing contracts are classified as operational and accounted for as costs.
Note 1 – PRINCIPLES FOR ALLOCATING COSTS (Figures in NOK 1000) Department Total Admin Fundraising Purpose General Secretariat (GS), Administration, Finance & ICT 15 299 6 498 3 736 5 065 Communication/Marketing 20 143 1 591 13 989 4 563 International department 7 511 0 676 6 085 Transfers to development projects, regional offices and partners 138 242 0 0 138 242 Total 181 195 8 090 18 400 154 705 NOTE 2 – KEY INDICATORS Percentage spent on purpose Percentage spent on administration Fundraising percentage
2015 85,4 % 4,5 % 75,4 %
Comments/Allocations basis Some direct allocation to admin, rest allocated on KRS office salary basis Allocation on the basis of activity Generally all purpose activities, apart from some major donor fundraising All activity outside Norway and with external partners is defined as purpose.
2014 2013 2012 2011 83,4 % 82,6 % 84,6 % 84,1 % 4,6 % 5,3 % 4,5 % 4,3 % 73,6 % 76,7 % 79,2 % 75,1 %
The percentage spent on purpose shows how much of the total expenditure that has gone to fulfil Strømme Foundations various purposes. The percentage spent on administration shows the share of the total expenditure that was covering unallocated administrative costs (general admin, accounts, ICT, audit, board/council expenses). The fundraising percentage shows how much of the money SF raises from private donors that goes to purpose costs, after the cost of raising the funds is deducted. Public Sector grants, grants from foreign organisations, financial income and other income are excluded from the calculation. From 2012 contributions from Norwegian organisations are partly included in the basis. The criteria for continued membership in the Norwegian fundraisers register is that a minimum of 65% of the funds raised is used on the organisation’s purpose over time.
22
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
NOTE 3 – PUBLIC SECTOR GRANTS Strømme Foundation has agreed a new five-year co-operation agreement with the Norwegian Agency for Development Co-operation (NORAD) for an expected annual support of NOK 57 mill. In excess of these we received additional grants for inclusive education and teacher training in South Sudan and funds for the speed school secretariat in West Africa. On top of the five year agreement with UK Aid from 2013 to provide funds for education for girls in South Sudan, they signed a new agreement to support a similar programme which covers both Uganda and South Sudan. Donor Norwegian Agency for Dvlpm. Coop. (NORAD) Norwegian Agency for Dvlpm. Coop. (NORAD) Norwegian Agency for Dvlpm. Coop. (NORAD) Norwegian Agency for Dvlpm. Coop. (NORAD) Norwegian Agency for Dvlpm. Coop. (NORAD) Swiss Agency for Development & Coop. (SDC) EU/Danish Church Aid (DCA) The Norwegian Peace Corps – Young The Norwegian Peace Corps (FK) The Norwegian Peace Corps (FK) UK Aid UK Aid US Aid UNICEF Total
Purpose Development Programmes Information Activities Teacher Education, South Sudan Inclusive Education for children, South Sudan Secretariat for Speed Schools, West Africa Speed School Programme – Mali Food Security and Livelihood - South Sudan Act Now Programme - Hald International Centre South/South Exchange Programme - East Africa Exchange programme, HTPV – South Sudan Education for girls, South Sudan Education for girls, Uganda/South Sudan Hydroponic Green Forage, Peru Pilot study, out of school children (East Africa)
2015 2014 56 923 112 58 700 000 900 000 1 000 000 2 703 800 3 600 000 2 260 000 56 535 2 170 668 - -174 333 2 547 529 1 886 030 1 539 451 1 277 319 593 117 1 405 311 6 460 107 3 545 280 2 215 510 880 173 332 370 246 326 - 8 689 80 131 531 70 945 463
These grants are earmarked for specific projects and are shown gross including the administrative support element. Settlement with the donor is made in arrears once a year. Unused capital must be returned. The co-operation agreement with NORAD (2014/2018) requires a minimum contribution of 10 % from Strømme Foundation, and allows up to 7% administration support. For programmes financed by public sector donors like FK and UK Aid, amounts spent on programme follow up are agreed in the budget. NOTE 4 – CONTRIBUTIONS FROM OTHER ORGANISATIONS Donor Purpose 2015 2014 Operation Dayswork, Norway Empower girls to become masters of their own life – Bangladesh 369 287 1 190 000 Operation Dayswork, Norway Empower girls to become masters of their own life – Nepal 7 550 178 6 510 613 Läkarmissionen, Sweden Saving-/credit groups and youth empowerment – Uganda 2 536 639 2 397 152 Läkarmissionen, Sweden Saving-/credit groups and literacy programme – South Sudan 1 087 131 838 365 Läkarmissionen, Sweden Literacy programme for women – Niger 1 140 856 1 215 410 Eriks Foundation, Sweden Speed Schools, Mali -143 502 Eriks Foundation, Sweden DREAM program, Myanmar 215 430 Eriks Foundation, Sweden Education and community development, Bangladesh 2 759 356 2 102 079 Eriks Foundation, Sweden Local community Development, South Sudan 3 747 293 1 820 351 Turing Foundation, The Netherlands Speed Schools, Niger 525 949 318 351 Hei Verden, Norway Inclusive Education, Bangladesh 491 536 Futuro Bolivia, Norway Occupational training for women, Bolivia 114 691 133 713 Tear Fund, Switzerland Programme follow up of Peruvian partners 227 103 181 524 Bernhard van Leer Foundation, The Netherlands Safe families & protected childhood, Peru 752 502 667 009 Rishi Sethia, India Earthquake rehabilitation, Nepal 75 550 Save the Children, international Pilot Study; out of School Children, East Africa - 10 548 Total 21 450 000 17 385 064 The Samvad programme in Nepal, financed by ODW, is at its largest in 2015. Läkarmissionen has extended its support for savings and credit groups concentrated in Uganda and South Sudan, and has entered into a new active literacy project for adults in Niger. Programmes in Bangladesh and South Sudan with Eriks Foundation continued as per contract with substantial growth. NOTE 5 - PRIVATE DONATIONS Donor Category Individual donations Fixed-term donations (Friend at Heart, Bridge Builder, Job Creator etc.) Events, schools and artists Testamentary donations Disaster and rehabilitation Total
2015 8 171 344 39 485 280 4 090 784 1 938 199 2 450 820 56 136 426
2014 8 664 783 38 362 175 3 319 913 5 164 063 55 510 934
NOTE 6 – CORPORATE SECTOR This income comes from our co-operation with the corporate sector and sports clubs. We define the co-operation in three categories. A ‘Main partner’ contributes NOK 500 000 or more, a ‘Plus partner” between 100 000 and 499 000 and a ‘Partner’ from 15 000 to 99 000. In 2015 we had six Main partners, Agder Energi, Skagerak Energi, Kristiansand Dyrepark, The Kavli Trust, Sparebankstiftelsen Spb SØR and AKO. Their accumulated donations comprise more than NOK 12.5 mill. Our largest sports co-operation partner is IK Start through their organisation Start Life Support. NOTE 7 – FINANCIAL INCOME/EXPENDITURE Other interest income Other financial income Other interest cost Other financial costs Total
2015 750 282 12 299 083 - -198 559 12 850 807
2014 673 840 3 116 380 -45 987 -47 980 3 696 252
On foreign current accounts in the balance sheet the following exchange rates are applied: USD/NOK 8.80 and EUR/NOK 9.60. In contrast to earlier years, exchange differences occur continuously during the year after resuming common financial system with the Kristiansand office at the East Africa and Asia offices. Custodies in foreign currency at balance sheet date are converted at the average bid rate stated by the currency exchange provider, Oanda. Net exchange gain in the regions is included under ‘Other financial income’. The same is applicable for net gain on forward exchange contracts.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
23
NOTE 8 – PRIVATE FUNDRAISING COSTS The costs of fundraising in the Norwegian private market are shown here, both the direct costs and the indirect support costs allocated to fundraising. Indirect costs are shown under ‘Other fundraising costs’ in the accounts. In 2015 a large “Job Creator” recruiting campaign was held in the Stavanger/Sandnes region. NOTE 9 – PROGRAMME SUPPORT Country/Region Bangladesh Sri Lanka Nepal Myanmar Asia Uganda Tanzania South-Sudan Kenya East Africa Mali Burkina Faso Niger West Africa Peru Bolivia South America Act Now Kultur – MIMETA Myrada - FK Global Total
2015 13 714 815 6 062 056 12 256 619 1 835 790 33 869 280 10 086 060 3 062 586 20 021 054 4 950 390 38 120 089 9 481 558 6 416 801 7 250 619 23 148 979 5 730 101 4 624 061 10 354 162 2 581 867 500 000 848 611 3 930 477 109 422 987
2014 9 758 663 3 761 834 6 520 461 103 147 20 144 105 10 436 564 2 377 758 13 844 616 3 554 878 30 213 816 11 982 037 4 049 990 4 111 393 20 143 421 4 312 857 3 036 418 7 349 274 1 890 578 500 000 2 390 578 80 241 194
Roughly estimated about NOK 15 mill of the increase in project support compared to 2014 comes from the change in the method of recording transfers to the regions and project cost described in Accounting Principles as well as a weak exchange rate for the Norwegian Krone. Programmes in Nepal and South Sudan have increased as a result of grants from public sector and other institutional funders – see Note 3 and 4. 10 – NATURAL DISASTER AID Country (cause) Nepal (Earthquake) Myanmar (Flood) Total
2015 1 004 224 299 662 1 303 887
2014 -
The Earthquake Disaster in Nepal triggered major donor will, and both acute and long-term measures have been initiated in selected areas in order to improve livelihoods of the inhabitants of the villages. NOTE 11 – PROGRAMME FOLLOW UP AT REGIONAL OFFICES Region Asia (Bangladesh, Sri Lanka, Nepal, Myanmar) East Africa (Uganda, Tanzania, South Sudan, Kenya) West Africa (Mali, Burkina Faso, Niger) South America (Peru, Bolivia) Total
2015 2014 7 745 438 8 075 265 7 672 101 6 199 972 8 022 868 6 456 375 4 075 219 3 336 988 27 515 626 24 068 600
In 2015,a new office was established in Niger. Moreover, the change in the cost level in our countries of operation and a weak exchange rate affects the total cost related to our regional offices. NOTE 12 – PROGRAMME FOLLOW UP IN KRISTIANSAND Department International department The Microfinance Company (SMF AS) Shared support services Total
2015 2014 6 085 313 5 319 638 750 000 1 500 000 4 052 055 6 505 510 10 887 368 12 462 648
The support for the microfinance company in Kristiansand covers part of their operative follow-up of the microfinance activities in the regions. NOTE 13 – INFORMATION AND PUBLIC EDUCATION WORK The communication department has two purposes: fundraising, and information and public education work. In addition to reports from the projects in the South to donors through our magazine Help for Self Help, this part of our work includes activities particularly targeted at schools, the corporate sector, the press and social media. The primary focus is on development issues rather than fundraising. The Norad grant of NOK 0.9 mill for information work covers part of the costs of such activities. NOTE 14 – VAT COMPENSATION The current legislation relating to VAT provides a facility for voluntary organisations to apply in arrears for the compensation of VAT paid. Received VAT compensation in 2015 is based on the total funds spent in 2014, and is recorded as income in the accounts, but stated on a separate line as extraordinary supply of funds in the activity account. No claim of outstanding VAT is recorded in the balance sheet for 2015. The accounts are charged inclusive of VAT, and compensation for VAT will be recorded as income in 2016.
24
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
NOTE 15 CHANGES IN PURPOSE CAPITAL (PC) Strømme Foundation Founding Capital PC with restrictions (SF projects) PC with restrictions (Microfinance) Other purpose capital TOTAL PURPOSE CAPITAL
31/12/2014 3 326 092 17 980 561 106 882 512 52 550 128 180 739 293
Change During 2015 - -930 137 See specification in Note 15B 12 362 320 Result for SF 2015 11 432 183
31/12/2015 3 326 092 17 050 424 106 882 512 64 912 448 192 171 476
A substantial part of fundraised capital is linked directly to projects. Many of these are also financed through public sector grants and grants from other organisations. After the allocation of public sector and institutional grants according to the terms of the cooperation agreements, the fundraised capital is used to cover SF’s own share. From year to year the usage of fundraised capital for specific purposes will vary, leaving remaining balances on running projects. Balances of closed projects will be reallocated to other projects according to agreed guidelines. After covering the project costs for 2015, the purpose capital with restrictions decreased by NOK 0.9 mill. Purpose Capital with restrictions (Microfinance) represents capital earned in the microfinance operations from the second half of 1990 until the first quarter of 2009. In 2009 the capital was formally transferred to Strømme Microfinance AS and its daughter companies. NOTE 15 B – CHANGES IN PC WITH RESTRICTIONS Region Asia East Africa West Africa South America Global Natural Disasters Total
2015 2 417 374 9 235 154 2 307 289 558 266 597 341 1 935 000 17 050 424
2014 2 903 176 8 343 904 1 399 456 - 5 334 025 - 17 980 561
Change 2014/15 -485 802 891 250 907 833 558 266 -4 736 684 1 935 000 -930 137
Change 2014/13 -886 562 1 055 346 1 037 435 -129 480 5 048 872 6 125 611
Business Premises 14 776 793 - 3700 14 776 793 7 622 939 7 153 854 304 634 2 -10%
Furniture and equipment 2 161 475 3700 2 157 775 1 840 551 317 224 103 769 20-30 %
Total 17 228 268
NOTE 16 – FIXED ASSETS Cost price 01/01/15 Acquisitions 2015 - Disposals 2015 Cost price 31/12/15 Accumulated depreciation 31/12/15 Book value 31/12/15 The year’s ordinary depreciation Depreciation rates
Property 290 000 - - 290 000 - 290 000 - 0 %
17 224 568 9 463 489 7 761 079 408 402
Strømme Micro Finance AS (SMF AS) is titleholder for the building site and business premises, with exception of one unit for which SF is the titleholder. SF has a credit line of NOK 24 mill for foreign exchange hedging. This is secured on the total property value NOK 7.2 mill. Since SF operates with an accounting principle to expense all equipment under NOK 50 000, the majority of the inventory is not included under fixed assets in the balance sheet. For the same reason, most fully depreciated assets do not appear here. All equipment in the Regional Offices is recorded as programme follow-up cost. NOTE 17 – PROPERTY UNDER DEVELOPMENT In 2002, the Strømme Foundation took over a property in Lillesand which had been left to us as a legacy gift. SF entered into an agreement in 2010 with Kaspar Strømme Eiendom to create a jointly owned company, Luntevika Eiendom AS, which will be responsible for the further development and sale of the property that is now regulated for housing purposes. During autumn 2014, the property was sold to Luntevika Eiendom with subsequent settlement to SF for costs incurred. Cost Price 01/01/14 Additions 2014 Disposals 2014 Cost Price 31/12/14 Depreciation
2015 - - - - 0 %
2014 3 289 109 12 488 -3 301 597 0%
NOTE 18 – INVESTMENTS IN SUBSIDIARIES Name Number Nominal value Owner share Book value in SF Result in subsidiary Equity in subsidiary 2015 31/12/15 Strømme Micro Finance AS 10 500 1 000 100 37 329 847 19 557 439 89 149 321 Mimeta AS 26 5 000 65 130 000 -110 410 630 924 Total investment in subsidiaries 37 459 847 19 447 029 89 780 245 Strømme Micro Finance AS (SMF AS), with its main office in Kristiansand, is a wholly-owned subsidiary of SF. The company conducts the microfinance activities on behalf of SF and submits its own annual report. In 2015, the SMF AS group has received a total of NOK 2.9 mill from SF for operation and capacity-building in microfinance. Mimeta AS, Centre for International Culture Development, also has its office in Kristiansand, and is owned together with Vest-Agder County. The company manages SF’s efforts in international culture development. Mimeta received grants totalling NOK 0.5 mill from SF in 2015. It has been decided to divest the company in 2016 since it no longer falls within the strategic focus areas of Strømme Foundation. NOTE 18 B – INVESTMENTS IN OTHER COMPANIES Name Number Nominal value Owner share Book Value in SF Result in the company Equity in the company 2015 31/12/2015 Hald International Center SA 200 1 000 33 200 000 41 156 3 949 313 Luntevika Eiendom AS 100 1 000 50 505 000 -766 247 -793 481 Total 705 000 -725 091 3 155 832 The joint venture Hald International Center (Hald) has its office in Mandal, and is owned in equal shares by The Norwegian Mission Society, The Norwegian Christian Student and Schools movement and Strømme Foundation. The objective of Hald is to provide courses and training for work within mission organisations, evangelism and development work, as well as for exchange programmes in different parts of the world. Hald is a Not-for-Profit organisation and cannot give
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
25
dividends to the owners. Hald is responsible for the Peace Corps 2015 grant of NOK 2.5 mill for SF’s exchange programme Act Now. Luntevika Eiendom AS, with its office in Kristiansand, is owned in fellowship with Kaspar Strømme Eiendom AS. The company was established in order to facilitate a commercial sale of the residential housing property in Luntevika, Lillesand. NOTE 19 – OUTSTANDINGS WITH SUBSIDIARIES AND OTHER COMPANIES The “Loans to Subsidiaries” of NOK 76.8 mill consists of interest free subordinated loans of NOK 72.2 mill with no repayment schedule and an interest bearing loan of NOK 4.6 mill without agreed repayment schedule. The last one is given in connection with the buyout of loans to clients in the Kaputiei project in Nairobi. All the loans are provided to Strømme Micro Finance AS. Other short term receivables includes a seller’s credit to Luntevika Eiendom AS of NOK 5.3 mill inclusive of incurred interest which matures as per specific agreement. This is secured by a bank guarantee of NOK 5.1 mill. Remaining intercompany receivables and debt pr. 31/12/15 is mainly related to the Microfinance Operation. NOTE 20 – INVESTMENTS IN CURRENT FINANCIAL ASSETS Category Cost Price 01/01/15 Market based shares - Primary Capital certificates 953 436 Market based bonds 8 835 251 Total 9 788 687
Book value 01/01/15 - 953 436 8 835 251 9 788 687
Additions 2015 15 348 484 - 10 011 405 25 359 889
Disposals Change in value 2015 - - 3 473 - - -8 836 370 -118 696 -8 836 370 -122 169
Devaluation pr 31/12/15 -3 473 - -118 696 -122 169
Book value 31/12/15 15 345 011 953 436 9 891 590 26 190 037
Market value 31/12/15 15 846 370 1 343 653 9 891 630 27 081 653
NOTE 21 – LIQUIDITY AND RESTRICTED ASSETS Free funds in Kristiansand office Free funds at the Regional Offices Sum free funds Employees tax deducted account Project/Grant accounts with restrictions Memorial Fund Restricted funds at the Regional Offices Sum restricted funds Total
2015 2014 26 989 562 24 883 280 8 667 928 8 756 584 35 657 490 33 639 864 672 199 481 706 6 916 984 15 884 652 151 375 150 289 5 337 270 5 996 155 13 077 828 22 512 801 48 735 318 56 152 666
NOTE 22 – PENSION OBLIGATIONS Employees who were 57 years and younger were, from March 2015, moved from the old pension scheme (“Foretakspensjon”) to a new deposit-based solution (“Innskuddspensjon”). Employees older than 57 remained in the old scheme. The old pension scheme is comparable to the State pension fund. At the start of 2015 there were 33 (33 in 2014) employees in the old pension scheme, while at the end of the year there were 5. The remaining 28 were moved to the new pension scheme. For the 28 employees in the new pension scheme there are no obligations beyond those paid during the year. The total cost related to the deposit based pension scheme was NOK 816,707 in 2015. SF has signed an agreement for a new AFP-plan through the Common National scheme of AFP’s. This agreement applies for 29 (32 in 2014) people, and in 2015 payments were made both to the old (transition period) and new AFP scheme. Actuarial calculations have been applied for calculating the obligations and costs in connection with the payment plans. The following assumptions have been used for the calculations: Discount rate Expected dividend Salary adjustments / year Yearly G-regulation / inflation Expected pension escalation
2015 2014 2.70 % 2.30 % 3.30 % 3.20 % 2.75 % 2.75 % 2.50 % 2.50 % 1.20% 1.75 %
Secured system 2015 Secured system 2014 AFP 2015 Gross pension obligations at 31/12 calculated at 13 883 862 24 500 063 - - Value of pension funds at 31/12 calculated at -11 875 296 -18 574 479 - + Deferred obligation in case of (loss) / profit -2 007 830 -5 428 254 - = Calculated net pension obligations at 31/12 736 497 330 - + Social Insurance contributions 104 70 124 - = Pension obligation as at 31/12 840 567 454 - Net over-financing 0 0 - Net obligations - Sum 31/12/14: 590 080 840 567 454 - The year’s pension accrual 301 739 1 739 397 - + interest cost 347 889 876 115 - + administration cost 245 508 210 403 - - Return on capital -364 444 -786 086 - = Net pension cost 530 692 2 039 829 - + Social Insurance contributions 74 827 287 616 - + Actuarial loss (gain) 223 423 171 348 - Recognized net liability at transition to new scheme -1 670 794 Recognized share actuarial loss/(gain) by change of scheme 2 208 739 = Total pension cost 1 366 887 2 498 793 -
AFP 2014 16 763 0 3 944 20 707 2 919 23 626 0 23 626 0 1 006 0 0 1 006 142 -69 773 -68 625
The amount is included in “Salaries and personnel expenses” in the accounts. (Note 25). Actual yield on the pension funds was 4.88 % in 2015 (5.25 % in 2014). NOTE 23 – GRATUITY PAYMENTS AT THE REGIONAL OFFICES At all the regional offices SF as well as the employees make regular deposits into public gratuity funds. These funds are not on the SF balance sheet. In addition to that, in Asia and East Africa contributions are set aside for a final payment to employees when they leave, but employees are entitled to draw on it before leaving. The sum on the balance sheet refers to these two regions. In most cases both SF and the individual employee make contributions according to the local legislation. In West Africa there is a legal obligation to make a payment on termination, depending on the years of service that is not included as a liability in the accounts. In South America there are no liabilities above the social security costs already accounted for.
26
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
NOTE 24 – OPERATIONAL COSTS Even though SF does not present a traditional profit and loss account, the guidelines for charitable organisations require the disclosure of additional information that would be shown if the expenditure were categorised by type and not activity. Notes 24 and 25 contain such a breakdown. The figures in this Note are partially revised from last year’s division. Cost type Project transfers to local partners Capacity building local partners Salary and personnel cost Kristiansand Salary and personnel cost in regions/external programmes Travel cost Kristiansand Travel cost inclusive of vehicles in regions/external programmes Office, ICT, consultants and other operating expenses in Kristiansand Office, ICT, consultants and other operating expenses in regions/external programmes Fundraising campaigns Kristiansand Depreciation in Kristiansand Totale driftskostnader
2015 94 820 683 7 674 186 21 720 492 20 159 074 2 861 253 6 381 586 10 909 600 9 954 615 6 305 586 408 403 181 195 478
2014 68 088 220 7 476 781 20 788 379 15 660 849 3 773 175 6 764 971 11 213 199 7 715 432 7 274 402 467 447 149 222 854
Several new programmes and escalation in some countries, plus more expensive foreign currency, has led to a substantial increase in “Project transfers to local partners”. Some of the programmes cover labor cost for SF employees in the regions, and this together with the establishment of new offices explains the increase in “Salaries and personnel cost in regions/external programmes”. NOTE 25 – SALARIES AND PERSONNEL EXPENSES / OTHER ALLOWANCES Cost type Salaries in Kristiansand Social Security Payments Pension Costs Other Personnel Costs in Kristiansand Sum salaries and personnel expenses in Kristiansand Salaries and allowances at Regional Offices/external programmes Total
2015 16 143 565 2 725 523 2 140 817 710 587 21 720 492 20 159 074 41 879 566
2014 15 688 240 2 604 953 1 701 634 793 552 20 788 379 15 660 849 36 449 228
From 2012 onwards we have shown projects where SF implements operator under “Salary and allowances at external programmes”. The average number of employees in Kristiansand was 30.5 (31.5). This amounts to 28.7 man-labour years in 2015, compared to 29.5 in 2014. In the Regional Offices the average number was 93 (91), equivalent to 91.9 man-labour years, compared to 89.6 in 2014. The total salary cost in 2015 for the Secretary General was NOK 801 951, other allowances NOK 45 833 and pension contributions NOK 388 486. The Secretary General has no bonus scheme or agreement of benefits in case of dismissal. In Norway, SF is obliged to have a pension scheme according to the compulsory service pension Law. The existing pension schemes fulfils this requirement (Note 22). The Executive Board and Advisory Board members have received no remuneration other than actual travelling costs. With the exception of salaries and travel claims, there are no financial transactions with employees or connected persons in Strømme Foundation in Norway. Outstanding loans to employees in the Regional Offices totalled NOK 142 183 at the yearend compared to NOK 96 604 at the end of 2014. These are included in “Other short term receivables” in the balance sheet. 26 – AUDIT FEES Statutory Audit Fees Other certification Other advising and assistance Total
2015 2014 487 369 692 871 181 641 74 841 8 750 282 306 677 760 1 050 018
The fees are stated exclusive of VAT. Total fees in 2015 to the group auditor in Kristiansand were NOK 304 050, while total fees to auditors of regional offices were NOK 373 710 for 2015. NOTE 27 - CURRENCY HEDGING The net gain on currency contracts materialized in 2015 was NOK 11.4 mill. This is recognized under financial items as opposed to previous years where financial gain subsidized programme cost. Total unrecognized gains in the period 2008 to 2014 was NOK 14.1 mill. At the end of the financial year, SF had forward currency contracts with a face value of USD 7.0 mill and EUR 2.4 mill which all terminate in 2016. The handling of these contracts is shown in the accounting principles note. The market value of the contracts was NOK 2.7 mill at the end of year. In accordance with the chosen accounting principles, the change in value of the contracts is not shown in the accounts.
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
27
CONSOLIDATED ACCOUNTS (STRØMME FOUNDATION, SMF AS GROUP, MIMETA) NOTE 28 – CONSOLIDATED SALARIES AND PERSONNEL EXPENSES / OTHER ALLOWANCES
2015 2014 Salaries in Kristiansand 18 042 494 17 256 923 Social Security 3 020 637 2 849 678 Pension costs 2 294 255 4 094 182 Other Personnel costs 798 627 870 133 Sum salaries and personnel costs in Kristiansand 24 156 013 22 770 916 Salaries and allowances in Regions / outside Norway 23 442 563 18 905 055 Total 47 596 566 41 675 971 Audit Fees (exclusive of VAT): Statutory Audit Fees 874 281 1 069 396 Other certification Fees 184 062 114 691 Other non-audit services 16 750 550 164 Total 1 075 093 1 734 252 Beyond Strømme Foundation the table above includes figures for the Microfinance Group and Mimeta. In addition to the employees stated in Note 25, there are an additional 17 employees in the group, 2 of which are in Norway. The salary of the Secretary General is disclosed in Note 25. Audit fees paid to the group auditors in Norway in 2015 is NOK 504 550 exclusive of VAT. The audit fees in the regions totalled NOK 570 543. NOTE 29 – CONSOLIDATED PURPOSE ACTIVITIES The total purpose cost in the consolidated accounts are reduced by the total grants of NOK 2.9 mill that was provided by SF to the microfinance activity. These costs are in the consolidated accounts presented as part of “Result Microfinance”. NOTE 30 – INVESTMENTS IN MICROFINANCE SF has organized the microfinance activities through the subsidiary group SMF AS. In the consolidated accounts SMF AS is included according to the equity method. The year’s changes in the Microfinance investments: Book value 01/01 Share of result Currency exchange differences Change in loan Book value 31/12
2015 163 342 552 19 214 756 -328 930 100 358 182 328 736
2014 132 037 021 19 812 856 6 327 383 5 165 292 163 343 552
NOTE 31 - PURPOSE CAPITAL (PC) - GROUP Founding capital PC with restrictions (SF projects) PC with restrictions (Microfinance) PC with restrictions (Mimeta) Minority interest with restrictions (Mimeta) Other purpose capital TOTAL PURPOSE CAPITAL
Purpose Capital The years result Currency exchange differences Purpose Capital 31/12/2014 differences 31/12/2015 3 326 092 3 326 092 17 980 561 -930 137 17 050 424 124 964 196 16 268 439 -328 930 140 903 705 481 867 -71 767 410 100 259 467 -38 644 220 823 80 538 118 14 939 095 95 477 213 227 550 301 30 166 985 -328 930 257 388 358
> South Sudan is one of the poorest countries in the world. In this country, devastated by war and conflict for so many years, education is one of many critical tasks that has to be taken care of. This picture, taken in march this year, is from a school in Aweil that was bombed during liberation in 2005, and since then never been renovated. The school is to day in use every day. Strømme Foundation focuses on education in South Sudan, and also one of the main actors in teacher’s education in the country.
28
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
29
30
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
Strømme Foundation Board and Council Members 2015 The board; 31 December 2015 Svein Ove Faksvåg (chairperson) Ansgar Gabrielsen Hege Wallevik Lars Saaghus Anna Minj Knut Vollebæk Torill Nyborg Selsvold
Council members; 31 December 2015 Hilde Midthjell Stein Hannevik (chairperson) Katrine Nødtvedt Kristin Andresen Dag Nordbø Ingunn Folkestad Breistein Henrik Syse Loveleen Brenna Torger Reve Elbjørg Dahl Jan Oddvar Skisland Erik Solheim Hilde Strømme Endre Glastad Ole Martin Årst Svein Gunnar Gundersen Sigbjørn Sødal Eli Beate Winsnes Hillesund Rannveig Rivedal Nilsen Snorre Kjesbu Tor Knutsen
Deputy Representatives Trond M. Backer Cecilie Watne Jostein Senumstad
Election committee; 1 January 2015 Gunnleik Seierstad Hilde M. Sæbø Fjeldstad Stein Hannevik
The facts behind the figures Administration, Fundraising and Purpose cost HOW WE USE THE MONEY/ 2015 Purpose (85,4%) Administration (4,5%) Fundraising (10,1%)
THE FACTS BEHIND THE PURPOSE COST 2015 International project work (89,4%) Project support/follow-up in Norway (7%) Information, development work/education - public (3,6%)
The Strømme Foundation is a member of the Norwegian Control Committee for Fundraising. Strømme Foundation is also a signatory to the Code of Conduct for the International Red Cross and Red Crescent movement and NGO’s in Disaster Relief. Editor: Egil Mongstad, Strømme Foundation. Contributors: Tørres Gilje, Anne Breivik, Kristine S. Sødal, Vidar Moseidjord, Cato Litangen, Lars Saaghus, Harald Eikeland, Tore Martin Herland. Lay-out and graphic design: Oddvar Paulsen, Strømme Foundation. All photo: © Strømme Foundation
w w w . s t r o m m e . o r g \ S T R Ø M M E F O U N D AT I O N A N N UA L R E P O R T 2 0 1 5
31
Skippergaten 5 • Box 414 • N-4664 Kristiansand Norway Tel +47 38 12 75 00 • Fax +47 38 02 57 10 • Org. no 952 002 139 E-mail: postkrs@stromme.org • www.stromme.org www.strommestiftelsen.no