Financial Report for the Eleven Months Ended 30 November 2015

Name of meeting / CILIP Board
Date of meeting: / 18 January 2016
Report title: / 1 January to 30 November 2015 Management report
Contains confidential information: / No
Agenda item no: / Electronic
Report by: / Bose Dada – Head of Finance
Jill Colbert – Director of Resources
Purpose: / To inform the Board of CILIP’s financialoutcome to 30 November and the cash flow projection for the year
Recommendations: / The Board to note the content of the paper

Compliance checks

Financial implications: / Working towards achieving the approved budget
Legal implications: / Statutory governance
Four nations implications / None
Equalities implications / None identified
Risk assessment: / Medium
Implications for charter/byelaws/regulations / None
Links to strategic priorities: / All priorities

Financial report for the eleven months ended 30 November 2015

Introduction

The performance result from January to November shows a net operational surplus of £84,535. If compared to the year to date reforecast, it surpasses our expectations by £73,059.

On our income there were unfavourable variances of (£6,324) and on our expenditure, there were favourable variance; of £79,383 on our total costs.

Appendix A highlights areas where we have made significant favourable/unfavourable variances.

Appendix B is the cash flow projection which provides the assurance that CILIP is able to meet its financial obligations as they fall due.

Financial performance driver’s report – Appendix A

CILIP’s performance drivers report in Appendix Ashows afavourable difference of £73,000but within that figure there are a number of variances.

Income

Total income was approximately (£6,000) below the reforecast and this can be accounted for as follows;

Rental income was £46,000 above target due to IFS back rent to June 2014 billed and received in 2015.
Investment income favourable difference of £6,000 was due to the reforecast conservative estimate of the distribution that will be received from our investment portfolio.
Sponsorship income was delivered as expected and Network only membership was above expectations by £1,000.
Events and miscellaneous income are on target as per the reforecast with favourable variance of £4,000 and £2,000 respectively.
Magazine income was below expectation by (£5,000) advertising income is relatively unpredictable andthe Head of Publications believes it is very unlikely that Update will make up the deficit by the end of the year.
Facet publishingwas below expectations by (£34,000) due to the delay in the publication of some titles.
Membership income was (£17,000) below target and this is being closely monitored especially since 56% of our members are on discounted rates.
Membership services income was (£4,000) below target due in particular to the slow take up of onsite training.
Catering and room bookings was (£5,000) below target because of the slower than expected take up of meeting rooms.

Expenditure

In general the Leadership Team prudence saved £79,000 against the reforecast expenditure in many areas.

There were only three reforecast lines that are showing significant unfavourable variances that were above £5,000 namely;

Agency staffs costs showing unfavourable variance against reforecast of (£21,000) which is mostly the needed support on the membership team, the agencystaff has now been employed as a permanent member of staff within the team.
IT costs unfavourable variance of (£7,000) was due the increasing costs of IT purchases, photocopying and toner.
Office costs unfavourable variance of (£11,000) was costs incurred to achieveour operational objectives.

The Senior Management Team hopes to deliver and surpass the reforecast budget by the end of the year.

Restricted funds

Restricted funds are to be used in accordance with specific restrictions imposed by the donors or which have been raised for a particular purpose. The restricted fund deficit of (£6,364)can be broken down as follows;

Details / Amount
Colin Mears - Investment income / £10,493
Colin Mears Greenway award / (£7,890)
Bob McKee/IFLA award / (£517)
Chilcot payments / (£8,680)
Henrick Jones memorial fund payment / (£200)
Revaluation loss on Colin Mears investment / £275
Revaluation loss on Cook's investment / £129
Revaluation loss on Other small restricted funds / £26
(£6,364)

Designated funds

Designated funddeficit of (£121,533) is analysed below:-

DESIGNATED FUND MOVEMENT AS AT NOVEMBER 2015
Income / Expenses / Depreciation / Year to date
Business development-Workforce mapping project / £12,000 / (£60,298) / (£48,298)
Business development-Impact Toolkit devt project / (£3,275) / (£3,275)
Business development-Leadership programme / (£476) / (£476)
Business development-Website project / (£12,050) / (£12,050)
Business development-Employer engagement project / (£2,176) / (£2,176)
Business development activities total / £12,000 / (£78,275) / (£66,275)
Membership Network Development fund / £10,031 / (£750) / £9,281
Head office refurbishment / (£31,780) / (£31,780)
Fixed Asset depreciation / (£32,760) / (£32,760)
Total / £22,031 / (£110,805) / (£32,760) / (£121,534)

The Resources committee approved £120,000 for Business development and £78,275 has been spent so far. Any unspent fund would be carried over until the project has been completed.

Investments

All investments were in M&G Charifund units which hold a well-diversified investment portfolio.

CILIP held 145,273 units and the value as at the end of November 2015 is stipulated below;

Investment - Movement
As at 31 December 2014 / As at 30 November 2015
Market Value at I January / £2,123,695 / £2,121,056
Acquisitions / £0 / £0
Disposals / £0 / £0
Realised gain(losses) / £0 / £0
Unrealised gain(losses) / (£2,639) / £3,167
Investment at market value / £2,121,056 / £2,124,223
Original cost of the investment / £964,820 / £964,820
Cumulative Revaluation gains / £1,156,236 / £1,159,403
Restricted element of unrealised (loss)/gain / (£359) / £430
Unrestricted element of unrealised (loss)/gain / (£2,280) / £2,737
(£2,639) / £3,167

Cash flow projection – Appendix B

A cash flow projection is shown in AppendixB; this isto assure the council that CILIP is able to meet its financial obligations as they fall due.

Trustees should also note that if there is a sudden drop in income, we may have to sell investments.

Our investment portfolio was valued at approximately £2 million.

Recommendations

Please note the content of this paper.

Bose Dada - Head of Finance

Jill Colbert – Director of Resources

CILIP,7th January 2016

Appendix A

CILIP'S PERFORMANCE DRIVER'S REPORT AS AT OCTOBER 2015
Year to Date 2015 / 2014 YTD / 2015/2014
Actual / Reforecast / Reforecast variance / Actual / Actual Comparison
Member Subscriptions / 1,547,105 / 1,563,778 / (16,673) / 1,563,591 / (16,486)
Rental income / 703,087 / 656,998 / 46,089 / 532,498 / 170,589
Events income / 298,212 / 294,315 / 3,897 / 159,091 / 139,121
Facet income / 537,144 / 571,377 / (34,233) / 655,966 / (118,822)
Magazine income / 383,722 / 388,419 / (4,697) / 469,092 / (85,370)
Qualification income / 80,801 / 82,973 / (2,172) / 88,252 / (7,451)
Onsite training income / 22,984 / 25,585 / (2,601) / 25,013 / (2,029)
Investment income / 51,950 / 45,964 / 5,986 / 50,175 / 1,775
Sponsorship income / 75,043 / 75,043 / 0 / 65,243 / 9,800
Catering & room bookings / 51,105 / 55,965 / (4,860) / 58,606 / (7,501)
Network only membership / 4,095 / 2,769 / 1,326 / 2,379 / 1,716
Miscellaneous income / 3,187 / 1,573 / 1,614 / 3,827 / (640)
Total Income / 3,758,435 / 3,764,759 / (6,324) / 3,673,733 / 84,702
Staff costs / 1,849,304 / 1,847,191 / (2,113) / 1,812,365 / (36,939)
Agency staff costs / 64,540 / 43,592 / (20,948) / 13,847 / (50,693)
Total Staffing Costs / 1,913,844 / 1,890,783 / (23,061) / 1,826,212 / (87,632)
Events cost / 171,037 / 168,989 / (2,048) / 62,927 / (108,110)
Facet costs / 252,885 / 250,065 / (2,820) / 278,111 / 25,226
Magazine costs / 116,817 / 126,899 / 10,082 / 157,507 / 40,690
Onsite training costs / 12,258 / 11,185 / (1,073) / 15,506 / 3,248
Qualification costs / 28,276 / 34,684 / 6,408 / 37,180 / 8,904
Network only membership transfer / 3,150 / 2,130 / (1,020) / 1,920 / (1,230)
Total core costs / 584,423 / 593,952 / 9,529 / 553,151 / (31,272)
Member Network costs / 39,389 / 50,163 / 10,774 / 47,822 / 8,433
IT Costs / 192,183 / 184,953 / (7,230) / 149,949 / (42,234)
Office costs / 122,964 / 112,326 / (10,638) / 119,251 / (3,713)
Building costs / 96,752 / 107,239 / 10,487 / 99,647 / 2,895
Stationery, printing & postage / 19,769 / 31,282 / 11,513 / 31,592 / 11,823
Telecommunications / 31,798 / 34,312 / 2,514 / 32,688 / 890
VAT / 43,135 / 46,039 / 2,904 / 8,165 / (34,970)
Other staff costs / 51,944 / 54,536 / 2,592 / 56,938 / 4,994
Committees / 86,977 / 94,093 / 7,116 / 74,174 / (12,803)
Project costs / 0 / 20,594 / 20,594
Consultancy services / 22,842 / 43,545 / 20,703 / 37,060 / 14,218
Legal & Professional fees / 12,236 / 13,282 / 1,046 / 17,122 / 4,886
Subscription to organisations / 33,924 / 35,523 / 1,599 / 33,775 / (149)
Catering and room bookings costs / (6,496) / 6,648 / 13,144 / 586 / 7,082
Communication & Marketing costs / 12,109 / 15,123 / 3,014 / 15,166 / 3,057
Bank charges / 13,314 / 15,943 / 2,629 / 16,238 / 2,924
Awards costs / 78,125 / 92,092 / 13,967 / 70,827 / (7,298)
Miscellaneous expenditure / 23,084 / 29,865 / 6,781 / 27,636 / 4,552
Total Other Running Costs / 874,049 / 966,964 / 92,915 / 859,230 / (14,819)
Total Costs / 3,372,316 / 3,451,699 / 79,383 / 3,238,593 / (133,723)
CILIP'S PERFORMANCE REPORT CONTINUED
Year to Date 2015 / 2014 YTD / 2015/2014
Actual / Reforecast / Reforecast variance / Actual / Actual Comparison
Performance Management Surplus/(Deficit) / 386,119 / 313,060 / 73,059 / 435,140 / (49,021)
Reducing pension deficit / (301,584) / (301,584) / - / (275,000) / (26,584)
Unrestricted funds operational surplus / (deficit) / 84,535 / 11,476 / 73,059 / 160,140 / (75,605)
Designated Fund surplus/(deficit) / (121,533) / (9,771) / (111,762)
Restricted fund surplus/(deficit) / (6,364) / (10,852) / 4,488
Unrestricted Investment gains/(losses) / 2,737 / (32,610) / 35,347
Net movement in funds / (40,625) / 106,907 / (147,532)

Appendix B

CASH FLOW PROJECTION FOR THE FINANCIAL YEAR 2015
Jan / Feb / Mar / April / May / June / July / Aug / Sept / Oct / Nov / Dec / FY15 Total
£'000 / £'000 / £'000 / £'000 / £'000 / £'000 / £'000 / £'000 / £'000 / £'000 / £'000 / £'000 / £'000
BOS Current / 55 / 55
BOS Deposit / 149 / 149
Cash B/F FY13 / 204
Total Monthly Cash per Cashbook / 204 / 305 / 203 / 313 / 256 / 145 / 178 / 55 / 151 / 156 / 161 / 279
Receipts
Membership DDs / 26 / 27 / 165 / 81 / 81 / 81 / 81 / 81 / 81 / 81 / 81 / 81 / 947
Membership - Full year paid / 118 / 57 / 61 / 61 / 61 / 61 / 61 / 61 / 105 / 61 / 707
Book-point receipts / 39 / 30 / 43 / 13 / 54 / 52 / 39 / 28 / 36 / 34 / 23 / 49 / 440
Sales Ledger Receipts / 197 / 138 / 235 / 12 / 41 / 97 / 67 / 197 / 16 / 101 / 153 / 160 / 1,414
M&G Investments and bank interest / 15 / 24 / 21 / 1 / 31 / 92
Vat refund / 13 / 12 / 25
IFS Rent Receipts / 89 / 89 / 89 / 101 / 89 / 457
Other Rent Receipts / 21 / 21 / 21 / 21 / 21 / 21 / 21 / 21 / 21 / 57 / 21 / 21 / 288
Total income / 416 / 216 / 610 / 212 / 258 / 401 / 290 / 402 / 304 / 285 / 484 / 492 / 4,370
Payments
Monthly Payroll including pension, tax & NI / (167) / (167) / (167) / (167) / (167) / (167) / (167) / (167) / (167) / (167) / (167) / (167) / (2,004)
Direct debit payments / (42) / (42) / (42) / (42) / (42) / (42) / (42) / (42) / (42) / (42) / (42) / (42) / (504)
Purchase Ledger Payments / (31) / (104) / (191) / (60) / (62) / (159) / (204) / (97) / (126) / (71) / (75) / (381) / (1,561)
VAT payment / (5) / (16) / (21)
Reducing pension deficit / (75) / (82) / (82) / (82) / (321)
Refund reserve withdrawal / (100) / (100)
Total Payments / (315) / (318) / (500) / (269) / (369) / (368) / (413) / (306) / (417) / (280) / (366) / (590) / (4,511)
Net cash inflow (outflow) / 101 / (102) / 110 / (57) / (111) / 33 / (123) / 96 / (113) / 5 / 118 / (98) / (141)
Cash injection from CILIP Reserve account / 118 / 118
Projected amount available for operations / 305 / 203 / 313 / 256 / 145 / 178 / 55 / 151 / 156 / 161 / 279 / 181 / 181

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