Financial Services Ombudsman s Bureau

Transcription

1 Fiacial Services Ombudsma s Bureau Aual Report 2015

2 Fiacial Services Ombudsma Aual Report 2015 Preseted to the Oireachtas uder Sectio 57BR of the Cetral Bak ad Fiacial Services Authority of Irelad Act, 2004 Published by Fiacial Services Ombudsma 2016 Third Floor, Licol House, Licol Place, Dubli 2

3 Our missio is to adjudicate o uresolved disputes betwee Complaiats ad Fiacial Services Providers i a idepedet ad impartial maer thereby ehacig the fiacial services eviromet for all stakeholders. Fiacial Services Ombudsma Aual Report 2015 Page 1

4 Fiacial Services Ombudsma Aual Report 2015

5 CONTENTS Chairperso s Report 3 The Fiacial Services Ombudsma Coucil 5 Foreword 9 Part oe Complaits 12 Part two Legal Matters 14 Part three Exteral Relatios 17 Part four Orgaisatioal Matters 21 Part five Fiacial Statemets 23 Page 2 Fiacial Services Ombudsma Aual Report 2015 Page 3

6 Chairperso's Report Chairperso of the Fiacial It is my great pleasure to preset my seveth aual report as Services Ombudsma Coucil. The statutory fuctios of the Coucil are prescribed by the Cetral Bak ad Fiacial Services Authority of Irelad Act 2004, ad are as outlied i specific detail o page 5 of the Aual Report. While my previous reports have focussed upo ad highlighted the jourey of the Fiacial Services Ombudsma Bureau (FSOB) across a period of itese activity, this report is more reflective of sigificat, positive, focussed ad ogoig chage. The chage is essetial i terms of the progressio of the process to itegrate the Office of the Pesio Ombudsma ito the Fiacial Services Ombudsma s Bureau. However, it is of the utmost importace that the chages reflect the curret, as well as future, eeds of the thousads who rely upo the Bureau ad the skills ad resources that it employs to meet them. Last year, whe preparig this foreword, I advised how the ew role of Fiacial Services ad Pesios Ombudsma, had bee successfully filled. Ger Deerig took up his positio as Fiacial Services Ombudsma o April 22d Followig facilitatig legislative provisio ad the retiremet of the curret icumbet, he will officially adopt the duties of Pesios Ombudsma (PO) early i I additio, Coucil, followig a Public Appoitmet Service (PAS) recruitmet campaig, will see its umbers ad capacity ehaced with ew ad skilled members addig stregth ad expertise to our oversight ad support role. A matter of great cocer to Coucil, especially i terms of the itegratio process, was the outstadig legislative procedure to officially commece the Fiacial Services Ombudsma s Bureau Superauatio Schemes. This too will be formally adopted early i I cosidered, i my previous report, how the firm bedrock for establishmet of the Fiacial Services ad Pesio Ombudsma s Bureau was i place. However, i fulfilmet of Coucil's requiremet uder the Act 'to keep uder review the efficiecy ad effectiveess of the Bureau' it was therefore cosidered that the itegratio required further, iformed, itelligece. To this ed, the Ombudsma, supported by Coucil ad followig a competitive process of teder, appoited Bearig Poit to udertake what would be a deep ad detailed aalysis of the curret operatios of both Offices i terms of their processes, strategies ad objectives. The fial report Strategic ad Operatioal Review - Fiacial Services Ombudsma ad Office of the Pesios Ombudsma was issued i Jauary The report, which is available o the Bureau's website, provides for ecessary, positive ehacemet of the orgaisatioal structure across may levels of iteral ad exteral egagemet ad process. Importatly, havig egaged with all stakeholders ad at every possible level throughout the process, it prepares the groud for chage to the beefit of all but with the essetial cosideratio of the users of the service. It is of the utmost importace that the itegrated Office presets each cosumer of the service with the most effective meas of resolutio for their dispute, i a idepedet, fair ad trasparet maer, ackowledgig the implicatios of the decisio upo them. To do so, Fiacial Services Ombudsma Aual Report 2015

7 therefore, also requires a acceptace from providers of the ecessity for them to meet the ew demads from the Ombudsma ad his staff. I kow how these requiremets, ad the positivity ad opportuity for all withi them, have bee outlied i the clearest of terms through direct egagemet at veues across the coutry.

8 It is also the case that the reforms have created a powerful structure for dispute resolutio. There should ot be ay uderestimatio of the very sigificat powers ad sactios available to this Ombudsma. I have cofidece that the process has positively commeced. Coucil's wish ad mie is that the implicatios for providers have bee uderstood ad that they too will itroduce the log overdue chages required to their processes without udue delay. Across the years sice the establishmet of the Bureau The Fiacial Services Ombudsma Coucil Recogitio ad appreciatio must also be exteded to the Ombudsma, Deputy Ombudsma, Head of Legal Services, Head of Admiistratio ad all of the staff ad ivestigators for their exceptioal idividual ad combied efforts ad achievemets throughout I also wish to pay tribute to the Miister for Fiace ad the staff of his Departmet, for their cotiued support. I closig I will restate how the Coucil ad I look forward to supportig ad workig with the ew Ombudsma ad his staff i our combied Mr Dermott Jewell Mr Michael Coolly there have bee thousads of complaits submitted ad adjudicated upo. However, i terms of cost, both persoal ad fiacial, mortgage related disputes cotiue to give rise to the highest level of legal egagemet. The recet past has brought tremedous challeges, but also, a wealth of learig. A foresic review, i cotext, of related case files has offered cosideratios for the future. Mediatio, for example, has prove to be eormously powerful as a alterative toward positive, meaigful resolutio ad closure. I wish to restate my high regard of ad gratitude to my etire fellow Coucil Members who each gave of their very sigificat expertise with professioalism ad cosideratio. I would metio also how appreciative we are of the sigificat iput from the Secretary to the Coucil. commitmet for cotiuity withi a evolvig structure. We must esure that our services, their quality ad meas of provisio are fit for purpose to comprehesively meet the eeds ad demads of all who have cause to cotact the Bureau. Dermott Jewell Chairperso Fiacial Services Ombudsma Coucil Fiacial Services Ombudsma Aual Report 2015 Page 6

9 Fuctio of the Coucil The Fiacial Services Ombudsma Coucil (the Coucil) is appoited by the Miister for Fiace. Its mai fuctios are to; Appoit the Fiacial Services Ombudsma (the Ombudsma) ad ay Deputy Ombudsma; Prescribe guidelies uder which the Fiacial Services Ombudsma's Bureau (the Bureau) is to operate; Determie the levies ad charges payable for the performace of services provided by the Ombudsma; Keep uder review the efficiecy ad effectiveess of the Bureau ad to advise the Miister for Fiace, either at the Miister's request or at its ow iitiative, o ay matter relevat to the Ombudsma's operatio; Advise the Ombudsma o ay matter o which he seeks advice. Members of the Coucil The Coucil is appoited by the Miister for Fiace. I October 2013, the Miister aouced the reappoitmet of the Chairperso ad members of the Fiacial Services Ombudsma Coucil for a period of two years (up to 28 October, 2015) or util the merger of the Fiacial Services Ombudsma s Bureau with the Pesios Ombudsma has bee completed, whichever is the sooer. Mr Dermott Jewell (Chairperso) Mr Jewell (B.Sc. Mgmt. (Law)(Triity College Dubli), CIArb.) is Policy & Coucil Advisor to the Cosumers- Associatio of Irelad. His represetatios iclude Chairperso/Director of the Europea Cosumer Cetre (ECC) Irelad, Director of the Ivestor Compesatio Compay Limited (ICCL) ad member of the Bakig Stakeholder Group of the Europea Bakig Authority. He is Irelad's represetative o the Europea Cosumer Cosultative Group (ECCG) of the Europea Commissio. Mr Michael Coolly Mr Coolly (B.B.S Triity College Dubli/F.I.B) is a Fiacial Services Cosultat specialisig i bak ledig/distressed loas. He is a Director of Oakfield Trust; Art ad Educatio Resource Store Irelad; ad a former Director of NAMA ad Chairma of its Credit Committee. I his executive career he was a Geeral Maager with Bak of Irelad Group, which icluded resposibility for busiess bakig, credit cotrol, iteratioal bakig, asset fiace, group isurace. He also served as Chairma of Bak of Irelad Group Ivestmet Committee ad a Bak Pesio Fud Trustee. Mr Athoy Kerr Mr Kerr M.A. (Dub.) LL.M. (Lod.) BL (Kigs Is), is a Statutory Lecturer i the Sutherlad School of Law, Uiversity College Dubli where he is Associate Dea for Graduate Studies. He is the author of a umber of books icludig The Civil Liability Acts (4 ed., 2011). Mr Paddy Leydo Mr Leydo is the previous Chairperso of the Credit Istitutios Ombudsma volutary scheme which was subsumed ito the Fiacial Services Ombudsma s Bureau i A Regioal Busiess Maager with Bak of Irelad - based i the North West, he is a Fellow of the Istitute of Bakers i Irelad ad a Member of the Istitute of Certified Public Accoutats i Irelad. Ms Caitríoa Ní Charra Mr Jewell holds accreditatios i both Employmet Ivestigatio ad Mediatio ad is a member of the Mediatio Istitute of Irelad (MII). Fiacial Services Ombudsma Aual Report 2015 Page 7

10 Mr Athoy Kerr Mr Paddy Leydo Ms Caitríoa Ní Charra Ms Elizabeth Walsh Mr Frak Wy Mr Jim Bardo Ms Ní Charra has served sice she was appoited as a member of the first Fiacial Services Ombudsma Coucil. She has worked with the Moey Advice ad Budgetig Service (MABS) for 20 years. She has particular iterest i debt ad poverty issues, as well as fiacial literacy. She has a degree i Commuity ad Family Studies ad has worked as a idepedet researcher ad traier. Ms Ní Charra formerly worked i Commuity Welfare Services for the HSE, ad the Departmet of Social Protectio. She was a former Director ad Compay Secretary of Cosumer DebtNet, a Europea umbrella group for moey advice services. She was a member of a Europea workig group that published the report 'Debt Collectio Practices Across Europe'. Ms Elizabeth Walsh Ms Walsh (BCL UCD) is a practisig solicitor with over 30 years experiece i geeral practice. She is a accredited mediator ad a metal health legal represetative. She served as Presidet of Limerick Solicitors Bar Associatio from Irelad betwee 1966 ad 1988 icludig Maager of Iteral Audit ad Seior Maager i Group Executive Office. He was Director Geeral of the Irish Bakers Federatio from 1988 to 2004, durig which time he chaired the Executive Committee of the Europea Bakig Federatio for two years. He is chairma of the Ivestor Compesatio Compay Limited. Coucil Subcommittees Audit Committee Mr Michael Coolly (Chairperso) Ms Elizabeth Walsh Mr Noel O Coell Fiace Committee Mr Frak Wy (Chairperso) Mr Dermott Jewell Ms Caitríoa Ní Charra Goverace Committee Mr Frak Wy Mr Wy is Director of Group Compliace & Operatioal Risk with the Irish Life Group. He is a accoutat (FCCA), a Associate of the Chartered Isurace Istitute, ad a Associate of the Irish Istitute of Pesios Maagemet. He is a former Board member of the Associatio of Compliace Officers i Irelad (ACOI) ad former Chairma of the ACOI's Audit Committee. Mr Paddy Leydo (Chairperso) Mr Dermott Jewell Mr Athoy Kerr Meetigs a. Coucil: Durig 2015, the Coucil held 6 formal meetigs ad 2 meetigs via coferece call. Attedace was as follows: Mr Jim Bardo (Secretary) Mr Bardo worked i various positios i Bak of Mr Dermott Jewell (Chairperso) Meetigs 8 Fiacial Services Ombudsma Aual Report 2015 Page 8

11 Mr Michael Coolly 8 Mr Athoy Kerr 7 Mr Paddy Leydo 8 Ms Caitríoa Ní Charra 6 Ms Elizabeth Walsh 7 Mr Frak Wy 8 b. Coucil Subcommittees The audit committee met o 4 occasios. The fiace committee met o 2 occasios. The goverace committee met o 5 occasios. Coucil Remueratio / Expeses The Miister for Fiace decides the level of aual fees to be paid to the Coucil members; 12,600 is paid to each member with 21,600 to the Chairperso. Claims for reimbursemet of travel ad subsistece expeses at curret public service rates are submitted quarterly. I that regard, the followig expese claims were submitted ad paid: Ms Caitríoa Ní Charra 1,526 Mr Paddy Leydo 2,428 Ms Elizabeth Walsh 360 Fiacial Services Ombudsma Aual Report 2015 Page 9

12 Foreword Fiacial Services Ombudsma Aual Report 2015 Page 10

13 Ombudsma s Foreword progressed through the office. A total of 822 complaits were settled without the eed for a adjudicatio or formal fidig. We facilitated mediatio of 83 complaits i 2015, 70 of these complaits were resolved to the satisfactio of both parties. A total of 1,206 complaits were closed by way of formal adjudicatio ad Fidig i Of the Fidigs issued 12% of complaits were upheld, 23% were partly upheld ad 65% were ot upheld. This is my first Aual Report as Fiacial Services Ombudsma (FSO), havig take up the role i April Therefore I wat to ackowledge the work of my predecessor Bill Prasifka ad also Jacqui McCrum, Actig Fiacial Services Ombudsma, for their cotributio to the achievemets outlied i this Report. The purpose of the Report is to provide a overview of the Bureau's activities for the year ad preset the Bureau's Aual Accouts. O receipt of a uresolved complait betwee a cosumer ad a fiacial service provider the FSO offers both parties the opportuity to egage i mediatio to resolve their dispute. While 2015 saw a small, but welcome, icrease i the umber of mediatios, with some very complex disputes beig resolved, there was still a regrettable reluctace o the part of fiacial service providers, i particular, to egage i mediatio. This, I am happy to report is chagig. Idicatios for 2016 would suggest that a very sigificat umber of cases will be resolved through mediatio. As outlied i more detail i this report, a total of 4,872 complaits were received ad a total of 4,915 complaits were closed i This reflects the legacy of the icreased umber of complaits i previous years. For this reaso we had almost 2,000 active complaits at the ed of Despite the reluctace, o the part of fiacial service providers, to egage i formal mediatio it cotiued to be the case throughout 2015 that may complaits were resolved by agreemet betwee the parties as they We udertook a Strategic ad Operatioal Review of the orgaisatio i This Review, carried out by idepedet cosultats BearigPoit, was udertake i cojuctio with the Office of the Pesios Ombudsma i aticipatio of the proposed merger of both offices. The Review Report is available o the Publicatios Sectio of our Website www. fiacialombudsma.ie. O foot of the respose to our cosultatios ad i lie with the recommedatios of the Strategic ad Operatioal Review we have itroduced sigificat chages to how complaits are dealt with sice February We ow udertake cosiderably more direct iteractio with both complaiats ad providers from the outset to deliver a faster, more efficiet ad effective service that puts the eeds of service users at its core. The key chage has bee the itroductio of a dedicated Dispute Resolutio Service to mediate ad resolve disputes at a early stage ad with miimum formality. Much of this activity is udertake by telephoe which saves sigificat time ad moey for all cocered. However, where these early itervetios do ot resolve a dispute this Office cotiues to provide idepedet Fiacial Services Ombudsma Aual Report 2015 Page 11

14 ad fair ivestigatio ad adjudicatio of disputes betwee complaiats ad fiacial service providers. A importat chage i the adjudicatio process will be the itroductio of Prelimiary Fidigs. Havig cosidered the iformatio ad material collected, icludig all submissios ad evidece furished, the Adjudicatio Service will issue a Prelimiary Fidig to both parties. If the parties make o further submissios, a legally bidig Fidig will be issued i the same terms ad the file will be closed. If either or both parties make further substative submissios relatig to possible errors of law or sigificat additioal poits of fact, these submissios will be reviewed, ad will be made available to the parties where ecessary, before a fial legally bidig Fidig is issued. Further details of the ew complaits hadlig process is available o our Website. I additio to the chages i complait hadlig outlied above we ited to make better use of data aalytics to: Idetify systemic issues ad alert cosumers Iform providers of the eed for chage Cotiue to iform the Cetral Bak where ecessary period the 1st Jauary 2015 to the 31st December 2015 was published o 31 March 2016 i our Aual Review 2015 ad is available o our Website. I would like to pay tribute ad say a very sicere thaks to the Bureau's Maagemet Team ad Staff who have show a great commitmet ad willigess to embrace chage i the iterest of deliverig better customer service for all who use our services. I am very grateful for their cotiued commitmet ad support. I would also like to thak Paul Key ad the staff of the Office of the Pesios Ombudsma for their co-operatio sice my appoitmet. Both Offices worked closely i preparatio for my appoitmet as Pesios Ombudsma ad the proposed merger of both Offices. I would also like to thak Dermott Jewell ad Members of the Fiacial Services Ombudsma Coucil for their o-goig commitmet to ad support for the work of the Bureau. 2016, will be aother busy period ad I look forward to workig with the Coucil, my Maagemet Team ad Staff ad all our Stakeholders as we edeavour to cotiuously improve our service ad make our cotributio to esurig quality ad fairess i the delivery of fiacial services geerally. Report o the activity ad performace of the FSO. This will ivolve providig cosumers, cosumer advocacy groups ad providers with the iformatio that they eed to uderstad the work of this office ad to assist them to resolve disputes at source. It will also result i chages to the format of future reports such as our Aual Review ad Aual Report, i additio to better use of our Website to provide more iformatio ad case studies o a ogoig basis. Ger Deerig Fiacial Services Ombudsma Sectio 72 of the Cetral Bak (Supervisio ad Eforcemet) Act 2013, gave the FSO the power to publish reports idetifyig regulated Fiacial Service Providers who, i the precedig fiacial year, have had at least three complaits agaist them substatiated or partly substatiated. This iformatio i respect of the Fiacial Services Ombudsma Aual Report 2015 Page 12

15 Orgaisatio Staff Structure Stephaie McCoell Claire Millrie Grace O'Flaherty Rachel O'Rega Fiace Departmet Name Evely Moore Ivestigator Ivestigator Ivestigator Ivestigator Title Fiacial Accoutat As at 31 December, 2015 Maagemet Name Title Ger Deerig Fiacial Services Ombudsma MaryRose McGover Head of Ivestigatio Diarmuid Byre Head of Admiistratio Ivestigatio Uit Name Title Michael Brea Pricipal Ivestigator Siead Brea Seior Ivestigator Joae Croi Seior Ivestigator Athoy O'Riorda Seior Ivestigator Kathlee O'Sulliva Seior Ivestigator Iseult Doherty Seior Ivestigator / Legal Assistat Support Staff Name Sylvia Costello Joa McGuiess Pre-Ivestigatio Name Meaga Gill Tomás Murray Marta Piekarz Paul Heffera Lida Kavaagh Lorraie Maher Paul O'Coor Emmett Greaey Title PA to Ombudsma Ivestigatio Admiistratio Title Pricipal Case Maager Seior Case Maager Seior Case Maager Case Officer Case Officer Case Officer Case Officer Case Admiistrator Admiistratio Uit Name Title A-Marie Det Receptio Frederica Doyle Receptio Orla Folleus Receptio Mary Hamilto Receptio Fiacial Services Ombudsma Aual Report 2015 Page 13

16 Complaits Fiacial Services Ombudsma Aual Report 2015 Page 14

17 Ivestmet 6 % Miscellaeous 4 % COMPLAINTS Our Role The Fiacial Services Ombudsma ca ivestigate, i a impartial ad idepedet maer, complaits from idividual customers ad small busiesses who have uresolved disputes with Fiacial Service Providers who are regulated by the Cetral Bak ad the Competitio ad Cosumer Protectio Commissio. The Cetral Bak ad Fiacial Services Authority of Irelad Act 2004, uder which the Fiacial Services Ombudsma Bureau was created, provides that the Ombudsma must be idepedet i the adjudicatio of complaits. Decisios of the Ombudsma are bidig, subject oly to appeal to the High Court. The Ombudsma ca direct a Fiacial Service Provider to rectify the coduct complaied of ad award compesatio of up to 250,000 where a complait is upheld. Complaits Overview The overview comprises a summary of the work coducted by the Bureau for A comprehesive breakdow by complait ad product type ad Fidigs issued by sector ca be foud i our Aual Review for 2015, which is available o our website uder our Publicatios sectio. Durig 2015: 4,872 ew complai ts were received. 4,915 complaits were closed i 2015 Sectoral breakdow of complaits received Bakig 2,385 Isurace 1,973 Ivestmet 307 Miscellaeous* 207 *Miscellaeous complait are complaits that do ot relate to a regulated fiacial service product ad/or a service provider who is ot a regulated fiacial provider ad were therefore referred to aother body. Isurace 41% I additio the office dealt with over 14,600 telephoe queries ad received 92,000 Website sessios. A total of 822 complaits were settled without the eed for a adjudicatio or formal Fidig. We facilitated mediatio of 83 complaits i 2015, 70 of these complaits were resolved to the satisfactio of both parties. A total of 1,206 complaits were closed by way of formal adjudicatio ad Fidig. Of the Fidigs issued 12% of complaits were upheld, 23% were partly upheld ad 65% were ot upheld. Compesatio awarded durig the year totalled 1,112,885 Oral Hearigs Complaits Received Bakig 49 % Oral Hearigs are called whe the Ombudsma, i the course of reviewig the evidece i a complait, decides it is ecessary to resolve the dispute betwee the parties to Fiacial Services Ombudsma Aual Report 2015 Page 15

18 the complait. A oral hearig may be ecessary where there is a issue of fact i dispute betwee the parties to the complait which caot be fairly resolved without hearig the parties. It is solely at the Ombudsma s discretio to decide whether to hold a Oral Hearig. Durig 2015, 24 oral hearigs took place at a total cost of 63,235 to the Fiacial Services Ombudsma s Bureau. Costs associated with holdig a Oral Hearig are Steography Services, Room Hire, Registrar Fees ad, o occasio, the services of a iterpreter. There is o charge to the parties of the complait for this service. Oral hearigs are held i private. Fiacial Services Ombudsma Aual Report 2015 Page 16

19 Legal Matters Fiacial Services Ombudsma Aual Report 2015 Page 17

20 Legal Matters decided upo by the High Court with a umber of ex tempore ad writte Judgmets delivered, icludig a sigificat writte Judgmet of the Court of Appeal. Two High Court Reserved Judgmets were awaited at year ed Copies of approved writte Judgmets are available o the Bureau s website. Of the 7 appeals heard before the High Court i 2015, 5 appeals were dismissed ad 2 appeals were allowed. As of 31st December 2015, there were: 10 High Court appeals o-goig (i.e. awaitig hearig or workig towards beig grated a hearig date), o Judicial Reviews o-goig, Appeals to the Ombudsma s decisio ca be brought i the High Court by complaiats ad fiacial service providers. I 2015 of the 11 ew appeals received, 1 was received from a fiacial service provider (this appeal was subsequetly withdraw prior to beig allocated a hearig date) ad 10 appeals were received from complaiats, of which 2 were received from lay litigats. Virtually all appeals ted to be i respect of the merits of the Fidig rather tha Judicial Reviews. 1 Judicial Review was received (ad resolved) i 2015 ad this ivolved a determiatio by the FSO to declie jurisdictio where o Fidig had bee issued. A appeal o the merits does ot ivolve a complete de ovo, hearig of all issues by the High Court, rather, for a appeal to succeed, a appellat must show a sigificat error or series of errors by the Ombudsma i arrivig at his Fidig. A umber of appeals are settled prior to hearig, which may iclude the Bureau agreeig to have a case remitted to the Ombudsma for re-cosideratio. I the course of 2015, 11 High Court appeals were withdraw by appellats prior to hearig ad 2 appeals were remitted to the Bureau o coset for re-cosideratio. While most of the Court Judgmets have o wider applicatio beyod the idividual appeals themselves, the Court s cotiued recogitio ad cosideratio of the Ombudsma s uique statutory fuctio cotiues to be a recurrig theme i Court Judgmets ad ideed i appeals of those Judgmets. Idividual appeals clearly differ o their specific facts ad circumstaces, ad the Judgmets issued i 2015 cotiue to idicate that there is a developig body of case law supportive of the view that the Ombudsma has a broad discretio as to procedures i the ivestigatio of a complait. High Court Appeals/Judicial Review - Fidigs of the Ombudsma are subject to appeal ad/or judicial review to the High Court. I the course of High Court appeals were resolved, 1 Judicial Review was resolved, 3 Supreme Court appeals were resolved ad 1 Court of Appeal appeal was resolved. A umber of appeals were Fiacial Services Ombudsma Aual Report 2015 Page 18 2 applicatios for leave to appeal to the Supreme Court o-goig, Appeal appeals o-goig, 2 Court of 1 Court of Appeal applicatio for leave to appeal ogoig, 4 High Court Appeals were adjoured geerally or stayed. There were o Pleary Proceedigs or other proceedigs o-goig as of 31 December Of particular ote for 2015 is the sigificat reductio of o-goig High Court appeals which stood at 10 as of 31 December 2015, represetig a record low for the previous 5 years. Supreme Court Appeals As of the 31st December 2015, there were 2 applicatios for leave to appeal pedig before the Supreme Court awaitig a hearig date. 1 Supreme Court appeal was withdraw by the FSO ad 1 appeal (ivolvig 2 sets of liked appeals) was withdraw by a fiacial services provider. Court of Appeal - As of the 31st December 2015, there were 2 appeals ad 1 applicatio for leave to appeal pedig. Durig the course of 2015 the Court of Appeal delivered a writte Judgmet i which it allowed a appeal brought by the FSO agaist a decisio of the High Court ivolvig the legal parameters of the fuctio of the FSO. Legal Costs - It is the policy of the Bureau to seek ad pursue legal costs i all appropriate cases. Further to a directio of the High Court, all litigats are iformed at the earliest opportuity of the potetial cosequeces of legal costs i litigatio ivolvig the FSO. Eforcemet Cases - I a very small umber of cases the Ombudsma, pursuat to his statutory powers ad discretio, egages i eforcemet proceedigs agaist Fiacial Service Providers who fail to comply with Fidigs of the Ombudsma. Appeal/Judicial Review Statistics 2015

21 At Ed 2014 High Court Appeals o had at 31 Dec Judicial Reviews O Had at 31 Dec Supreme Court Appeals O Had at 31 Dec 2014 (icludes 2 sets of liked appeals) 5 Court of Appeal Appeals O Had at 31 Dec New Appeals Received I 2015 New High Court Appeals received i 2015: of which: - 10 received from Complaiats - 2 received from fiacial services provider (1 of these subsequetly withdraw prior to hearig) New Judicial Reviews received i New Supreme Court Appeals received i * ( *applicatio for leave to appeal) Appeals to the New Court of Appeals (all 3 appeals lodged by Lay Litigats) 3 New other Pleary Proceedigs received i 2015 Noe 11 - Court of Appeal Appeals Resolved 1 Judgmet delivered FSO Appeal allowed 2 Appeals withdraw prior to hearig AT END 2015 High Court Appeals o-goig at 31 Dec Reserved Judgmets awaited 2 Appeals adjoured geerally/stayed 4 Judicial Reviews o-goig at 31 Dec 2015 Noe Supreme Court Appeals o-gog at 31 Dec * * Applicatios for leave to appeal Court of Appeal Appeals o-goig at 31 Dec Applicatios for leave to appeal o-goig 1 3 APPEALS RESOLVED IN 2015 High Court Appeals Resolved i Appeals Heard 7 of which: - Appeals Dismissed 5 - Appeals Allowed (remitted by Court) 2 - High Court Appeals withdraw pre-hearig 11 - High Court Appeals remitted o coset 2 - Judicial Review Cases Resolved (remitted o coset) 1 - Supreme Court Appeals Resolved i 2015, of which: 3 1 withdraw by Appellat (Provider 2 sets of liked appeals) 1 trasferred to Court of Appeal 1 withdraw by FSO Fiacial Services Ombudsma Aual Report 2015 Page 19

22 Exteral Relatios Fiacial Services Ombudsma Aual Report 2015 Page 20

23 Exteral Relatios Co-operatio with the Cetral Bak The Fiacial Services Ombudsma is a arbiter of disputes betwee customers ad Fiacial Service Providers, but is ot a regulator. There is a Memoradum of Uderstadig betwee the Fiacial Services Ombudsma s Bureau (FSOB), the Cetral Bak ad the Pesios Ombudsma. If a matter arises durig a ivestigatio by the Fiacial Services Ombudsma which he feels should be brought to the attetio of the Regulator, he will iform the Cetral Bak so that appropriate regulatory actio may be take. He also co-operates with the Pesios Ombudsma so as to avoid uecessary overlap. Quite apart from the Memoradum, the three offices have ejoyed, ad cotiue to ejoy, close co-operatio. Meetigs betwee the Cetral Bak ad the FSOB were held regularly ad whe deemed ecessary i Iteractios o a umber of issues were udertake, more specifically o Tracker Mortgages, Offset Mortgages, Mortgage Arrears Resolutio Processes ad referrals i relatio to a umber of brokers. I aticipatio of the amalgamatio of the FSOB with the Pesios Ombudsma s office, additioal meetigs were udertake betwee the two offices to discuss operatioal ad legislative issues. Both offices participated i a Steerig Group, orgaised ad chaired by the Departmet of Fiace, to facilitate the merger. FIN-NET/Cross Border Co-operatio The Bureau is a member of FIN-NET, a fiacial dispute resolutio etwork of atioal out-of-court complait schemes i the Europea Ecoomic Area coutries resposible for hadlig disputes betwee cosumers ad Fiacial Service Providers. The Network was lauched by the Europea Commissio i Withi FIN-NET, the members co-operate to provide cosumers with easy access to out-of-court complai procedures i cross-border cases. Presetatios & Briefigs atteded The Ombudsma ad staff members deliver a outreach program to a variety of stakeholders icludig; Life Isurace Associatio Mediatio Foudatio of Irelad The Law Society of Irelad PIBA IBA Associatio of Compliace Officers Irelad Bakig ad Paymets Federatio LIA Isurace Istitutes Educatioal Istitutios Fiacial Services Ombudsma Aual Report 2015 Page 21

24 Meetigs / Cofereces FLAC Departmet of Public Expediture ad Reform IBEC Fiacial Service Providers Iteratioal Network of Fiacial Services Ombudsma FIN-NET Press Coucil Iformatio Commissio Compliace Associatio of Chief Executives of State Agecies The Cetral Bak of Irelad Other Public Iformatio Media iterviews Website updates Aual Report Aual reviews Irelad Bakig & Paymets Federatio of Irelad Oifig a Choimisiéara Teaga Office of Fiacial System Mediator, Armeia Ombudsma Associatio Departmet of Fiace Pesios Ombudsma Visits to the Office Lati America Delegatio Fiacial Ombudsma Service UK Fiacial Service Providers Fiacial Services Ombudsma Aual Report 2015 Page 22

25 Orgaisatioal Matters Fiacial Services Ombudsma Aual Report 2015 Page 23

26 Orgaisatioal Matters Risk Strategy It is the policy of the Fiacial Services Ombudsma s Bureau to comply with best practice goverace ad accoutability obligatios. This icludes the requiremet of the Code of Practice for the Goverace of State Bodies ad Risk Maagemet Guidelies for Govermet Departmets ad Offices. Strategy Statemet I 2013, a decisio was made by Govermet to amalgamate the Fiacial Services Ombudsma s Bureau with the Pesios Ombudsma s office. The implemetatio of the amalgamatio will require primary legislatio. The Bureau is actively workig with the Pesios Ombudsma s office ad the Departmet of Fiace to develop a pla for a smooth trasitio of this amalgamatio. This strategy statemet has bee developed for the comig 12 moths o the basis that the amalgamatio will complete durig The Strategy Statemet for was approved by the Fiacial Services Ombudsma Coucil ad is published o our website. Its targets ad objectives are uder costat review by the Maagemet Team. Evirometal Policy Statemet As part of the Fiacial Services Ombudsma s Bureau s requiremets uder SI No. 542/2009 Europea Commuities (Eergy Ed Use Efficiecy ad Eergy Services) Regulatios 2009, ad its commitmet to reducig its eergy requiremets i lie with the Departmet of Commuicatios, Eergy & Natural Resource s goals of improvig eergy efficiecy i the public sector by 33% by 2020; the Bureau is actively seekig to reduce the eergy use of its office. Eergy cosumptio by the Bureau, as a whole, ca be primarily attributed to the ruig of the office. I 2015 the Bureau expaded its office space to cater for the Pesios Ombudsma s office which is i the process of beig amalgamated with the Fiacial Services Ombudsma s Bureau. The Bureau ow has a office space that comprises both the third ad fourth floors of the five storey Licol House buildig. 175,308 KWh of eergy was cosumed by the office i 2015 cosistig of: 62,829 KWh of Electricity 112,479 KWh of Fossil Fuels (Gas Heatig) This equates to a overall icrease i eergy usage of 23.5% o 2014 figures. Whilst electricity use per staff member has decreased over the period the larger floor space ow occupied by the Bureau ad the Office of the Pesios Ombudsma cosumes cosiderably more eergy i the form of heatig ad this has directly impacted o the eergy cosumptio figures. As part of our efforts to reduce our eergy use the Bureau udertook a umber of iitiatives last year which icluded: The extesive reovatio of a portio of the fourth floor of the office to facilitate the arrival of the Pesios Ombudsma staff. This icluded ew LED lightig uits ad complimetary motio sesors. The cotiued expasio of the use of digital correspodece (e.g. ) betwee our office ad both providers ad complaiats. I 2016 the Bureau has udergoe a cosiderable trasformatio i how we address complaits. With the itroductio of the dispute resolutio uit i the office a cosiderable umber of complaits are ow settled by telephoe mediatio. Oe of the kock-o effects of this ew approach is that the electrical eergy cosumed by the office per complait has reduced as less pritig/ postage ad frakig is required. I the majority of complaits commuicatios are by phoe ad or . It Fiacial Services Ombudsma Aual Report 2015 Page 24

27 is hoped that the eergy use of the office will show a cosiderable drop i 2016 because of this. A umber of actios will take place i the office i the period to help reduce the eergy use of the office further, icludig a review of accommodatio use ad cofiguratio i aticipatio of a full merger of the Fiacial Services Ombudsma s Bureau ad the Office of the Pesios Ombudsma. It is aticipated that the implemetatio of the eergy reductio measures that are outlied above should have the effect of further reducig the overall eergy cosumptio per staff member i the office i 2016, thereby showig the Bureau s commitmet to meetig its resposibilities i relatio to the public service s eergy efficiecy targets. Staff Traiig The Fiacial Services Ombudsma s Bureau recogises the importace of ogoig professioal developmet for all staff members. I this regard the Bureau ecourages ad supports staff to develop their kowledge ad skills at all stages of their career. The levy amouts are prescribed by the Coucil with the coset of the Miister for Fiace. These are icluded i the Fiacial Statemets of this report. Compliace with Legislatio The Office complies with statutory requiremets i the areas of Health ad Safety, Equality, Paretal Leave ad i other areas icludig: Ethics i Public Office Acts ; The office complies with the provisio of the Acts ad to the Stadards i the Public Office Commissio s Guidelies for Office Holders; Official Laguage Act 2003, stadard letters ad documets are traslated ito Irish ad the website has a Irish sectio also; Data Protectio Acts 1998 ad 2003; Prompt Paymets of Accouts Act 1997; Fiacial Emergecy Measures i the Public Iterest Act 2013 (FEMPI 2013). Fiace Legislatio uder which the Bureau operates provides that levies are payable by the Fiacial Service Provider to eable the Bureau carry out its statutory fuctio. Fiacial Services Ombudsma Aual Report 2015 Page 25

28 Fiacial Statemets Fiacial Services Ombudsma Aual Report 2015 Page 26

29 Fiacial Services Ombudsma Aual Report 2015 Page 27

30 Fiacial Statemets Fiacial Services Ombudsma Aual Report 2015 Page 28

31 Statemet of Resposibilities of the Fiacial Services Ombudsma Sectios 57 BP ad BQ of the Cetral Bak Act, 1942 as iserted by Sectio 16 of the Cetral Bak ad Fiacial Services Authority of Irelad Act, 2004 require the Fiacial Services Ombudsma to prepare fiacial statemets i such form as may be approved by the Fiacial Services Ombudsma Coucil after cosultatio with the Miister for Fiace. I preparig those fiacial statemets, the Ombudsma is required to: Select suitable accoutig policies ad the apply them cosistetly; Make judgemets ad estimates that are reasoable ad prudet; State whether applicable accoutig stadards have bee followed, subject to ay material departures disclosed ad explaied i the fiacial statemets; Prepare the fiacial statemets o the goig cocer basis uless it is iappropriate to presume that the Bureau will cotiue i operatio. The Ombudsma is resposible for keepig proper books of accout, which disclose i a true ad fair maer at ay time the fiacial positio of the Bureau ad which eable it to esure that the fiacial statemets comply with Sectio 57 BQ of the Act. The Ombudsma is also resposible for safeguardig the assets of the Bureau ad for takig reasoable steps for the prevetio ad detectio of fraud ad other irregularities. Ger Deerig Fiacial Services Ombudsma 1st September 2016 Fiacial Services Ombudsma Aual Report 2015 Page 29

32 Statemet o iteral fiacial cotrol The Fiacial Services Ombudsma (Ombudsma) ackowledges as Ombudsma that he is resposible for the Fiacial Services Ombudsma s Bureau (Bureau) system of iteral fiacial cotrol. The Ombudsma also ackowledges that such a system of iteral fiacial cotrol ca provide oly reasoable ad ot absolute assurace agaist material error. The Ombudsma sets out the followig key procedures desiged to provide effective iteral fiacial cotrol withi the Bureau: As provided for i Sectio 54B of the Cetral Bak Act, 1942 as iserted by Sectio 16 of the Cetral Bak ad Fiacial Services Authority of Irelad Act, 2004 the Ombudsma is resposible for carryig o, maagig ad cotrollig geerally the admiistratio ad busiess of the Bureau. The Ombudsma reports to the Fiacial Services Ombudsma Coucil (Coucil) at their meetigs which are geerally held o a bi-mothly basis. The Coucil ad the Bureau have adopted ad implemeted a Code of Practice for the Goverace of the Fiacial Services Ombudsma Bureau based o the Departmet of Fiace Code of Practice for Goverace of State Bodies. The Ombudsma ad Coucil review bi-mothly icome ad expediture statemets with aalysis of major icome ad expediture categories. The Ombudsma via the Fiace Committee reviews the aual budget through a comprehesive budgetig system. The work of Iteral Audit is iformed by the aalysis of the risks to which the Bureau is exposed ad the Iteral Audit pla is based o this aalysis. Actio was take to esure that the idetified potetial risks were beig maaged i a appropriate maer. A detailed iteral audit programme of work was agreed ad completed i The Audit Committee reports to the Ombudsma ad Coucil. The Committee met o four occasios i The Ombudsma moitors ad reviews the efficiecy of the system of its iteral procedure. Review of Iteral Cotrols I have reviewed the iteral audit reports, the miutes of the audit committee meetigs ad the effectiveess of the system of iteral fiacial cotrols. Where cotrol deficiecies were highlighted these have bee addressed. I also ote that a iteral audit programme of work has bee agreed for 2016 ad I will implemet ay ecessary improvemets to correct ay deficiecies it may brig to light. Ger Deerig Fiacial Services Ombudsma 1st September 2016 Statemet of Icome ad Expediture ad Retaied Reveue Reserves For the year eded 31 December 2015 Notes Icome Levy Icome 2 3,743,343 5,967,732 Fiacial Services Ombudsma Aual Report 2015 Page 30

33 Other Icome 2 4,909 28,590 Net deferred fudig for pesios 5c 96,000 - Total Icome 3,844,252 5,996,322 Expediture Admiistratio 4 3,982,859 4,524,846 Retiremet beefit costs 5a 96,000 - Depreciatio 6 106, ,228 Total Expediture 4,184,897 4,632,074 Surplus/(Deficit) for the Year Before Appropriatio Trasfer from/(to) Capital Accout 3 (340,645) 1,364,248 43,953 42,604 Surplus/(Deficit) for the Year after Appropriatio (296,692) 1,406,852 Balace Brought Forward at 1 Jauary ,163, ,471 Balace Carried Forward at 31 December ,866,631 2,163,323 All icome ad expediture for the year relates to cotiuig activities at the reportig date. The Statemet of Icome ad Expediture ad Retaied Reveue Reserves icludes all gais ad losses recogised i the year. The Statemet of Accoutig Policies ad otes 1 to 17 form a itegral part of these Fiacial Statemets. Ger Deerig Fiacial Services Ombudsma 1st September 2016 Fiacial Services Ombudsma Aual Report 2015 Page 31

34 Statemet of Comprehesive Icome Notes Surplus After Appropriatios (296,692) 1,406,852 Experiece gais o retiremet beefit obligatios 5d - Chage i assumptios uderlyig the preset - value of retiremet beefit obligatios Total actuarial gai/(loss) i the year - Adjustmet to deferred retiremet beefits fudig For the year eded 31 December 2015 Other Comprehesive Icome for the year (296,692) 1,406,852 The Statemet of Accoutig Policies ad otes 1 to 17 form a itegral part of these Fiacial Statemets. Ger Deerig Fiacial Services Ombudsma 1st September 2016 Statemet of Fiacial Positio As at 31 December 2015 Fixed assets Notes Property, plat & equipmet 6 330, ,565 Fiacial Services Ombudsma Aual Report 2015 Page 32

35 Curret assets Cash ad cash equivalets 475,095 1,207 Bak Deposit Accouts 7,076,312 7,918,166 Receivables 7 119, ,384 Curret Liabilities (amouts fallig due withi oe year) Cash ad cash equivalets Payables 8 4,853,021 Provisio for Legal Services 9 951,289 7,670,941 8,036,757-48,198 4,445,052 1,380,184 5,804,310 5,873,434 Net curret assets 1,866,631 2,163,323 Retiremet Beefits Deferred retiremet beefit fudig asset 5b 96,000 - Retiremet beefit obligatios 5b (96,000) - Net assets 2,197,243 Represetig Capital Accout 2,537, , ,565 Retaied Reveue Reserves at 31 December 1,866,631 2,163,323 2,197,243 2,537,888 The Statemet of Accoutig Policies ad otes 1 to 17 form a itegral part of these Fiacial Statemets. Fiacial Services Ombudsma Aual Report 2015 Page 33

36 Ger Deerig Fiacial Services Ombudsma 1st September 2016 Statemet of Cash Flows For the year eded 31 December 2015 Net Cash Flows from Operatig Activities Shortfall i icome over expediture (296,692) 1,394,371 Depreciatio charge 106, ,228 (Icrease)/decrease i receivables (2,150) (18,788) Icrease/(decrease) i payables (20,926) 340,972 Iterest received (4,909) (28,590) Trasfer to capital accout (43,953) (42,604) Net Cash Outflow from Operatig Activities (262,592) 1,752,589 Cash Flows from Ivestig Activities Bak iterest received 4,909 28,590 Ivested i short-term deposits 841,854 (2,075,202) Capital expediture (62,085) (64,624) Net Cash Flows from Ivestig Activities 784,678 (2,111,236) Cash Flows from Fiacig Activities Bak iterest received Net Cash Flows from Fiacig Activities Net Icrease/(Decrease) i cash i the year 522,086 (358,647) Cash ad Cash Equivalets at 1 Jauary (46,991) 311,656 Cash ad Cash Equivalets at 31 December 475,095 (46,991) Fiacial Services Ombudsma Aual Report 2015 Page 34

37 Notes to the Fiacial Statemets For the year eded 31 December Accoutig Policies The basis of accoutig ad sigificat accoutig policies adopted by the Fiacial Services Ombudsma s Bureau are set out below. They have all bee applied cosistetly throughout the year ad for the precedig year. 1a Geeral Iformatio The Fiacial Services Ombudsma s Bureau, established uder the Cetral Bak ad Fiacial Services Authority of Irelad Act 2004, is a corporate etity ad cosists of the Fiacial Services Ombudsma, the Deputy Fiacial Services Ombudsma ad the staff. It is a statutory body fuded by levies from the fiacial service providers. The Bureau deals idepedetly with complaits from cosumers about their idividual dealigs with fiacial service providers that have ot bee resolved by the providers. The Fiacial Services Ombudsma Coucil is appoited by the Miister for Fiace. Its fuctios as laid dow i the Act are to: appoit the Ombudsma ad the Deputy Ombudsma; prescribe guidelies uder which the Ombudsma is to operate; determie the levies ad charges payable for the performace of services provided by the Ombudsma; approve the aual estimate of icome ad expediture as prepared by the 1b Ombudsma; keep uder review the efficiecy ad effectiveess of the Bureau ad to advise the Miister for Fiace o ay matter relevat to the operatio of the Bureau; advise the Ombudsma o ay matter o which the Ombudsma seeks advice. The Coucil has o role whatsoever regardig complaits resolutios. Coucil ad Bureau Expeses The expeses of the Coucil are met from Bureau Fuds (see ote 15). Statemet of Compliace The fiacial statemets of the Fiacial Services Ombudsma s Bureau for the year eded 31 December 2015 have bee prepared i accordace with FRS 102, the fiacial reportig stadard applicable i the UK ad Irelad issued by the Fiacial Reportig Coucil (FRC), as promulgated by Chartered Accoutats Irelad. These are the Fiacial Services Ombudsma s Bureau s first set of fiacial statemets prepared i accordace with FRS 102. The date of trasitio to FRS 102 is 1 Jauary The trasitio to FRS 102 has ot affected its reported fiacial positio or fiacial performace. Fiacial Services Ombudsma Aual Report 2015 Page 35

38 1c 1d 1e Basis of Preparatio The fiacial statemets are prepared uder the accruals method of accoutig ad uder the historical cost covetio i the form approved by the Fiacial Services Ombudsma actig o the advice of the Miister for Fiace i accordace with Sectio 57 BP of the Cetral Bak Act, 1942 as iserted by Sectio 16 of the Cetral Bak ad Fiacial Services Authority of Irelad Act The followig accoutig policies have bee applied cosistetly i dealig with items which are cosidered material i relatio to the Fiacial Services Ombudsma s Bureau fiacial statemets. Levy Icome Coucil regulatios made uder the Cetral Bak ad Fiacial Services Authority of Irelad Act, 2004 prescribe the amout to be levied for each category of fiacial service provider. Levy icome represets the amouts receivable for each service provider calculated i accordace with the regulatios ad based upo providers idetified by the Bureau ad iformatio supplied to it. Bad debts are writte off where deemed irrecoverable. Expediture Recogitio Expediture is recogised i the fiacial statemets o a accruals basis as it is icurred. 1f Property, Plat ad Equipmet Property, Plat ad Equipmet are stated at cost less accumulated depreciatio, adjusted Fiacial Services Ombudsma Aual Report 2015 Page 36 for ay provisio for impairmet. Depreciatio is provided o all property, plat ad equipmet,

39 1g 1h at rates estimated to write off the cost less the estimated residual value of each asset o a straight lie basis over their estimated useful lives, as follows: Retiremet Beefits (i) Leasehold Improvemet category 1 5% per aum (ii) Leasehold Improvemet category 2 25% per aum (iii) (iv) Computer Equipmet 33% per aum All other assets 25% per aum Residual value represets the estimated amout which would curretly be obtaied from disposal of a asset, after deductig estimate costs of disposal, if the asset were already of a age ad i the coditio expected at the ed of its useful life. If there is objective evidece of impairmet of the value of a asset, a impairmet loss is recogised i the Statemet of Icome ad Expediture ad Retaied Reveue Reserves i the year. Capital Accout The Capital Accout represets the uamortised value of icome used for capital purposes. Employee Beefits Short- term Beefits Short- term beefits such as holiday pay are recogised as a expese i the year, ad beefits that are accrued at year-ed are icluded i the Payables figure i the Statemet of Fiacial Positio. For certai staff mem bers the Burea u is i discus sio with the Depar tmet of Fia ce regar dig the future fiac ig ad maa geme t of a defie d beefi t super aua tio scheme. Pedig a decisio o the matter a provisio calculated as a percetage of relevat salaries has bee made. (See ote 10). Pedig fialisatio of the proposed pesio arragemets, pesio ad lump sums are ot charged as expediture but are set agaist the pesio credit balace. For other staff members the Bureau makes cotributios to a defied cotributio scheme (See ote 10). These amouts are charged to the Icome ad Expediture Accout as they fall due. Sigle Public Service Pesio Scheme The Fiacial Services Ombudsma also operates the Sigle Public Services Pesio Scheme ( Sigle Scheme ), which is a defied beefit scheme for pesioable public servats appoited o or after 1 Jauary Sigle Scheme members cotributios are paid over to the Departmet of Public Expediture ad Reform (DPER). Pesio costs of the sigle scheme employees reflect pesio beefits eared by them, ad are show et of staff pesio cotributios which are remitted to the Departmet of Public Expediture ad Reform. A amout correspodig to the pesio charge is recogised as icome to the extet that it is recoverable, ad offset by grats received i the year to discharge pesio paymets. Actuarial gais or losses arisig o scheme liabilities Fiacial Services Ombudsma Aual Report 2015 Page 37

40 1i 1j are reflected i the Statemet of Comprehesive Icome, ad a correspodig adjustmet is recogised i the amout recoverable from the Departmet of Public Expediture ad Reform. The fiacial statemets reflect, at fair value, the assets ad liabilities arisig from Fiacial Service Ombudsma s pesio obligatios i respect of the sigle scheme staff ad ay related fudig, ad recogises the costs of providig pesio beefits i the accoutig periods i which they are eared by these employees. Retiremet beefit scheme liabilities are measured o a actuarial basis usig the projected uit credit method. Receivables Receivables are recogised at fair value, less a provisio for doubtful debts. The provisio for doubtful debts is a specific provisio, ad is established whe there is objective evidece that the Fiacial Services Ombudsma s Bureau will ot be able to collect all amouts owed to it. All movemets i the provisio for doubtful debts are recogised i the Statemet of Icome ad Expediture ad Retaied Reveue Reserves. Operatig Lease Retal expediture uder operatig leases is recogised i the Statemet of Icome ad Expediture ad Retaied Reveue Reserves over the life of the lease. Expediture is recogised o a straight-lie basis over the lease period, except where there are retal icreases liked to the expected rate of iflatio, i which case these icreases are recogised whe icurred. Ay lease icetives received are recogised over the life of the lease. 1k Critical Accoutig Judgemets ad Estimates The preparatio of the fiacial statemets requires maagemet to make judgemets, estimates ad assumptios that affect the amouts reported for assets ad liabilities as at the balace sheet date ad the amouts reported for reveues ad expeses durig the year. However, the ature of estimatio meas that actual outcomes could differ from those estimates. The followig judgemets have had the most sigificat effect o amouts recogised i the fiacial statemets. Impairmet of Property, Plat ad Equipmet Assets that are subject to amortisatio are reviewed for impairmet wheever evets or chages i circumstaces idicate that the carryig amout may ot be recoverable. A impairmet loss is recogised for the amout by which the asset s carryig amout exceeds its recoverable amout. The recoverable amout is the higher of a asset s fair value less cost to sell ad value Fiacial Services Ombudsma Aual Report 2015 Page 38