Board Report: July 2014
Hi Everyone,
The July Board meeting was held in Wellington on Sunday 27th July. The main items discussed at the meeting were:
- The financial results for the full year. While still provisional, the Net Operating Surplus is looking like being just over $905,000, which is very close to the original aspirational budget of $1.04 million.. As previously advised the Board took the opportunity of this good level of surplus to deal with a number of historical items, including Centenary books (written down by $61,800 to nil value), Toy IRB's (written down by $67,500 to nil value), Centenary Teddy Bears (written down by $8,900 to nil value) and the loan to Lifesaving First Aid (written down by $217,661 to nil value). After these Balance Sheet revaluations, which totalled just over $367,000, we have a provisional Net Profit of $538,000. This compares to a loss of $270,000 for the previous year. While it was all as expected, the Board was still delighted with the confirmation of the turnaround result, and look forward to it being signed off by the auditors.
- The provisional Balance sheet is showing a level of Net Equity of around $600,000, up from $102,000 last year which is equally pleasing for both the membership and Board.
- The provisional CAPEX spend for the year was close to $690,000, which was good to see, slightly ahead of budget. The amount carried forward into 2014/15 will be substantially less than in previous years, demonstrating that significant progress was being made on a number of long-term projects.
- Overall, we are very happy to have climbed the first rung on the ladder to financial recovery - but this is just one year and we need several more like it to rebuild the cash reserves to a pre-2010 level. A full set of financial reports will be sent out in a few weeks to all clubs. In the meantime we won't distribute the normal monthly Management Reports as these are only provisional, and subject to final audit confirmation. As usual the full set of financial accounts will be included with the AGM packs.
- In relation to the AGM, I would like to remind clubs that they have until 20th August to nominate their delegates to attend the AGM, and advise if they have any agenda items. I encourage every club to take the opportunity to attend, as the day is much more than just the AGM, with the Chairs Strategy Workshop in the morning and the National Awards of Excellence Dinner in the evening.
- A good chunk of the remaining time of meeting was spent in discussions around Water Safety. At the heart of this was a Board-to-Board session involving a number of members of the Water Safety New Zealand (WSNZ) Board where we spent time looking at a variety of topics including the Sector Plan (a sector-wide strategy to reduce the drowning rate in New Zealand) and how the various parties in the sector can work together to best leverage their collective expertise and resources. This was a valuable session and it is good to see the close links being formed within the sector. Our CEO and I will be attending a Sector Plan workshop later in August and look forward to seeing some good progress there.
- The Board received an update on the Board Appointment Panel's work. There was an improved level of interest in the Elected and Appointed Board positions this year which was good to see, and continuing interest in the Independent Appointed position. At the time of the meeting the Panel was undertaking its shortlisting and was looking to interview candidates early in August.
- Management provided a summary of the current fundraising strategy for the Board to review. It was good to see some hard decisions had been made about exiting low-yield activities over the last year, and while it appeared that income was down, the bottom line profit was now improving. The challenge from here for Management is to execute the strategy so that a step-change improvement in this income stream can be achieved in the next few years to be able to offset the seemingly relentless decline in Gaming Trust revenues from fewer and fewer gaming machines out in the market.
- The Board also reviewed a report on the use of high visibility vests for the 2013/14 season. At this stage we saw no reason to change the current approach of Clubs being totally accountable for ensuring all vests are 'fit for purpose'. SLSNZ will continue to provide guidelines, with the Clubs continuing to make their own calls on design and colours. The Board will look at this again at the end of next season just to make sure this approach is still working well. The only shadow on the horizon to watch may be the new Health & Safety legislation, in the event this seeks to make SLSNZ ultimately fully liable for Club actions, or inactions.
- On that note, the draft Health & Safety Plan development by our H & S consultant was shared with the Board. At this stage it is only in draft form, and clarification is being sought on the level of accountability that our Constitution puts on SLSNZ for the actions of individual Clubs. If it is concluded that the legislation seeks to hold SLSNZ accountable over the action or inaction of a member Club, then this would tend to suggest the need for a heavier burden of top down, mandatory procedures for all Clubs, with a more intense auditing regime. This is the view Coastguard NZ have taken, and are implementing for their member groups. If, as we believe, the level of accountability is not so high, then a more flexible and supportive role can be played and would be reflected in the strategy. This will be a very relevant topic for the Club Chairs Strategy Workshop held just prior to the AGM, as by then we will have advice on the impact of this legislation on us all.
- The Board was provided with an update on Clubs having their Constitutions aligned to the SLSNZ Constitution, a task that has been going on for at least four years now. Last year the final deadline for this was set as 30th September 2014 and it is good to see that the vast majority of clubs have completed the task. However there are few remaining and the Board strongly encourages them to finish this off as soon as possible, and help is available from the respective SLSNZ and SLSNR staff to do this. Technically, clubs who don't have an aligned Constitution are not members of the organisation which creates the risk of a number of unintended consequences. One of these is that after September, NZLGB grants will be withheld for clubs not close to completion, so please ask for any help that you need to get the work done.
- On a much more positive note, the Board endorsed the National Honours & Awards Committee recommendations for Service, Distinguished Service, Life Member and 50 Year Badge recipients, and look forward to congratulating in person those who can attend the Awards Dinner after the AGM. The Board would like to thank the Committee (Neil Reid, Neale Ames, Sheryl McLay and Murray Wilson) for their sterling work once again on behalf of the movement.
Overall, a long day of work for the Board, but a lot of positive things to talk about! The next Board meeting will be a phone teleconference on Sunday 24th August. So until my next update…
Yours in surf,
Geoff Hamilton
Chairman
Surf Life Saving New Zealand