FINANCIAL STATEMENTS
FINANCIAL STATEMENTS CONTENTS PAGE ADMINISTRATIVE INFORMATION 2 STATEMENT OF THE RESPONSIBILITIES OF THE TRUSTEES 3 REPORT OF THE INDEPENDENT AUDITORS 4 5 REVENUE ACCOUNT INCOME 6 REVENUE ACCOUNT EXPENDITURE 7 STATEMENT OF RECOGNISED GAINS AND LOSSES 8 BALANCE SHEET 9 CASH FLOW STATEMENT 10 NOTES TO THE FINANCIAL STATEMENTS 11-15 1
ADMINISTRATIVE INFORMATION TRUSTEES Emmet Stagg Brian O Shea Breeda Moynihan-Cronin PARTY LEADERSHIP Party Leader: Deputy Leader: General Secretary: Eamon Gilmore Joan Burton Ita McAuliffe REGISTERED OFFICE 17 Ely Place Dublin 2 Ireland AUDITORS O Connor and Associates Chartered Accountants and Registered Auditors Harcourt Centre Block 3 Harcourt Road Dublin 2 BANKERS Bank of Ireland 2 College Green Dublin 2 Permanent TSB 12/13 Lower O Connell Street Dublin 1 SOLICITORS O Mara Geraghty and McCourt 15 Northumberland Road Dublin 4 2
STATEMENT OF THE RESPONSIBILITIES OF THE TRUSTEES The Labour Party is a Political Party registered with the Clerk of Dáil Éireann. The administration of the Labour Party is organised on a segmental basis with the Labour Parliamentary Party and each constituency, divisional and regional council, party section and branch separately responsible for their activities. Accordingly, these accounts represent only the activity of the Head Office of the Labour Party including the Parliamentary Allowances and related expenditure. They do not record or represent the activities of any constituency, divisional or regional council, party section or branch of the Labour Party, individual parliamentarians or any member of the Labour Party. The Trustees are required to prepare financial statements for each financial period which give a true and fair view of the state of affairs of the Party and of the surplus or deficit for that period. In preparing those financial statements the Trustees are required to: - select suitable accounting policies and apply them consistently; - make judgments that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Party will continue in operation. The Trustees confirm that they have complied with the above requirements in preparing the financial statements. The Trustees are responsible for keeping proper books of account, which disclose with reasonable accuracy at any time the financial position of the Party. The Trustees are also responsible for safeguarding the assets of the Party and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The activities of the Labour Party require it to provide funding for day to day activities while permitting the Party to build up reserves to meet the significant costs associated with election activities. The Trustees have recognised this situation and have created an Election Reserve. The Trustees remain confident that the Party will continue to be in a position to support activity in furtherance of party activities. The Trustees are responsible for the maintenance and integrity of the organisation and financial information included on the Party s website. Legislation in the Republic of Ireland governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. Signed by the Trustees Emmet Stagg Brian O Shea Breeda Moynihan-Cronin DATE 3
Report of the Independent Auditors To the Members of The Labour Party We have audited the financial statements of The Labour Party for the year ended 31 December 2012 which comprise the Revenue Account, the Balance Sheet, Cash Flow Statement and the related notes. These financial statements, on pages 6 to 15, have been prepared under the historical cost convention and the accounting policies set out on page 11. This report is made solely to the Party s members, as a body. Our audit work has been undertaken so that we might state to the Party s members those matters we are required to state to them in an auditor s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Party and the Party s members as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of Trustees and Auditors The Trustees responsibilities for preparing the financial statements in accordance with applicable legal and regulatory requirements and Irish Accounting Standards are set out in the Statement of Trustees Responsibilities, on page 3. Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and Auditing Standards promulgated by the Auditing Practices Board in Ireland and the United Kingdom. We report to you our opinion as to whether the financial statements give a true and fair view in accordance with generally accepted accounting practice in Ireland. We also report to you whether in our opinion: proper books of account have been kept by the Party. In addition, we state whether we have obtained all the information and explanations necessary for the purposes of our audit and whether the Party s Balance Sheet, Revenue Account and Cash Flow Statement are in agreement with the books of account. We read the other information contained in the financial statements and consider whether it is consistent with the audited financial statements. This other information comprises only the schedules to the accounts. We consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the financial statements. Our responsibilities do not extend to any other information. Basis of audit opinion We conducted our audit in accordance with International Auditing Standards issued by the Auditing (UK and Ireland) Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgments made by the Trustees in the preparation of the financial statements and of whether the accounting policies are appropriate to the Party's circumstances, consistently applied and adequately disclosed. 4
Report of the Independent Auditors To the Members of the Labour Party Basis of audit opinion, continued We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. Opinion In our opinion the financial statements give a true and fair view of the state of the Party s affairs as at 31 December 2012 and of its surplus for the year then ended. We have obtained all the information and explanations we consider necessary for the purpose of our audit. The financial statements are in agreement with the books of account. O Connor and Associates Chartered Accountants & Registered Auditors Harcourt Centre, Block 3 Harcourt Road Dublin 2 DATE 5
REVENUE ACCOUNT Income Notes Party Leader Allowance 1,789,783 1,634,607 Electoral Act 1997 1,287,267 1,191,978 Trade Unions affiliation fees 118,597 99,425 Members contribution 6 277,778 286,562 Donations 1,932 174,596 General Election Fund 37,372 27,558 Interest 17,503 805 Fundraising activities 7 11,589 21,233 GE Core Package 200,000 - Other Income 125 1,108 Total Income 3,741,946 3,437,872 Total Expenditure (2,223,566) (3,112,392) Surplus for the year 4 1,518,380 325,480 Signed by the Trustees Emmet Stagg Brian O Shea Breeda Moynihan-Cronin DATE 6
REVENUE ACCOUNT Expenditure Notes Staff Salaries and Pensions 5 1,058,267 1,170,198 National Conference 253,047 30,286 Political and Constituency 284,660 353,589 Electoral Fund 231,243 945,097 Other Head Office Expenses Interest and Charges 14,042 21,674 Centenary Event 100,000 - Consultancy costs 57,035 66,375 Depreciation 18,333 18,333 Leasing Office Equipment 27,583 28,838 Insurance 33,302 22,665 Heating, Lighting and Cleaning 6,115 9,914 Miscellaneous 11,732 11,117 Postage and packaging 6,692 10,572 PR, Publicity and Printing 50,018 102,103 Professional Fees 24,823 33,868 Rent & Rates 9,306 7,326 Head Office Maintenance and Refurbishment 15,626 68,752 Telephone 34,510 54,083 Recruitment, training and payroll charges 20,070 18,562 Travel and subsistence 57,642 120,764 Reversal of provision for legal costs (100,000) - Other 9,520 18,276 Total Expenditure 2,223,566 3,112,392 Signed by the Trustees Emmet Stagg Brian O Shea Breeda Moynihan-Cronin DATE 7
STATEMENT OF RECOGNISED GAINS AND LOSSES Notes Surplus for the year 1,518,380 325,480 Total recognised gains for the year 1,518,380 325,480 Surplus for the year 1,518,380 325,480 General Reserve at 1 January 957,179 6,791 Transfer (to)/from Election Reserve Fund 12 (331,959) 624,908 General Reserve at 31 December 12 2,143,600 957,179 Signed by the Trustees Emmet Stagg Brian O Shea Breeda Moynihan-Cronin DATE 8
BALANCE SHEET AS AT 31 DECEMBER 2012 Notes Fixed Assets Premises 8 672,000 686,000 Office Equipment and Furniture 8 4,333 8,666 676,333 694,666 Current Assets Debtors 9 13,551 25,390 Cash at bank 10 3,362,715 1,981,335 3,376,266 2,006,725 Less: Current Liabilities Creditors and Provisions 11 (230,754) (233,778) Net Current Assets 3,145,512 1,772,947 Creditors Amounts falling due After one year Borrowings 14 (673,508) (837,656) Net Assets 3,148,337 1,629,957 Financed By Revenue Reserves - General Reserve Fund 12 2,143,600 957,179 - Election Reserve Fund 12 703,192 371,233 Revaluation Reserve 12 301,545 301,545 3,148,337 1,629,957 Signed by the Trustees Emmet Stagg Brian O Shea Breeda Moynihan-Cronin DATE 9
CASH FLOW STATEMENT Notes Net cash inflow from operating activities 13 1,562,839 152,769 Return on investments and servicing of finance Interest received 17,504 805 Interest paid (34,814) (43,439) Net cash outflow from returns on investments and servicing of finance (17,310) (42,634) Taxation - - Capital expenditure and financial investment Purchase of tangible assets - - Net cash outflow from capital expenditure and financial investment - - Increase in cash and cash equivalents 15 1,545,529 110,135 10
NOTES TO THE ACCOUNTS 1. Accounting Policies (a) These accounts record the activities of the Head Office of The Labour Party including the Parliamentary Allowance, Electoral Act Allowance and related expenditure for the year ended 31 December 2012. The accounts do not represent the activities of any constituency, divisional or regional council, party or section of or branch of the Labour Party, individual parliamentarians or any member of The Labour Party during the period. (b) Members contributions are accounted for on the basis of contributions remitted in respect of the accounting period they are received and include remittances received after the year end. (c) Party Leaders Allowance and Electoral Act Funding are accounted for on the basis of contributions remitted in respect of the accounting period they are received and include remittances received after the year end. (d) Donations are accounted for on the basis of donations remitted in respect of the accounting period in which they are received. (e) These accounts are prepared under the historical cost convention as modified by the revaluation of certain fixed assets. (f) The accounts are prepared on an accruals basis. Income and expenses are recognised as they are notified to the Party Head Office. (g) Depreciation is provided on the fixed assets at rates calculated to write off the cost of the assets over their expected useful lives as follows:- Premises Office Equipment & Furniture 2% Straight Line 12.5% Straight Line (h) Premises are measured at cost and any subsequent increase in the value of the premises is accounted for as a revaluation reserve through the Statement of Recognised Gains and Losses. Changes in market value of Fixed Assets are reflected in the Revaluation Reserve. If impairment is deemed to be permanent, the loss is firstly recognised through the excess Revaluation Reserve and then charged directly against the current year s surplus. 2. Financial Situation The activities of The Labour Party require it to provide funding for day to day activities while permitting the Party to build up reserves to meet the significant costs associated with election activities. The Trustees have recognised this situation and have created an Election Reserve Fund. The Trustees remain confident that the Party will continue to be in a position to support activity in furtherance of party objectives. 11
NOTES TO THE ACCOUNTS 3. Taxation Charge for year - - - - 4. Surplus for the year Surplus arrived at after charging: Staff Salaries and Pensions 1,058,267 1,170,198 Auditors fees 8,610 8,610 Depreciation 18,333 18,333 5. Staff costs Staff Salaries and Pensions 968,012 1,070,353 Employers PRSI 90,255 99,845 1,058,267 1,170,198 The average number of persons employed during the year was 19 (2011: 22). 6. Members contributions Branches & Councils 9,110 7,185 Membership Registration with Head Office 60,616 60,568 Parliamentary Party Subscriptions 107,350 93,050 MEP Subscription 7,000 7,000 Members Standing Orders 42,756 67,013 Councillors Subscriptions 50,946 51,746 277,778 286,562 7. Fundraising activities Rose Ball - 13,151 Christmas Draw 11,589 8,082 11,589 21,233 12
NOTES TO THE FINANCIAL STATEMENTS 8. Fixed Assets Cost Office Equipment Premises & Furniture Total At 1.1.12 700,000 306,334 1,006,334 Additions - - - At 31.12.12 700,000 306,334 1,006,334 Depreciation At 01.01.12 14,000 297,668 311,666 Charge for the year 14,000 4,333 18,333 Acc Depreciation at 31.12.12 28,000 302,001 329,999 Net Book Value at 31.12.12 672,000 4,333 676,333 Net Book Value at 1.1.12 686,000 8,666 694,666 The freehold land and buildings of The Labour Party were revalued by Thorntons Chartered Surveyors, in February 2011 on the basis of open market value with vacant possession. In accordance with FRS 15, Trustees have considered the net book value as at 31 December 2012 and believe it to be reasonable. 9. Debtors Prepayments 13,551 25,390 13,551 25,390 10. Bank Head Office account 145,893 170,315 Party Leader allowance account 1,380,663 774,995 Electoral account 1,127,456 659,220 Development account 708,703 376,805 3,362,715 1,981,335 13
NOTES TO THE FINANCIAL STATEMENTS 11. Creditors & Provisions Creditors Trade Creditors 91,175 39,984 Accruals 111,693 65,265 PAYE/PRSI 27,886 28,529 230,754 133,778 Provisions Provision for legal costs - 100,000 230,754 233,778 12. Reserves General Reserve Election Reserve Revaluation Reserve Total Opening balance 957,179 371,233 301,545 1,629,957 Surplus for the year 1,518,380 - - 1,518,380 Transfer (to)/from Election Reserve (331,959) 331,959 - - Closing balance 2,143,600 703,192 301,545 3,148,337 14
NOTES TO THE FINANCIAL STATEMENTS 13. Reconciliation of operating surplus to net cash inflow from operating activities Operating surplus 1,518,380 325,480 Interest paid 34,814 43,439 Interest received (17,503) (805) Depreciation charges 18,333 18,333 Decrease/(Increase) in debtors 11,839 219,241 Increase/(Decrease) in creditors (3,024) (452,919) 1,562,839 152,769 14. Analysis of changes in net debt during the year 1 Jan 2012 Cash Flow 31 Dec 2012 Mortgage Loan (426,240) 43,193 (383,047) Loan (411,417) 120,956 (290,461) Total (837,657) 164,149 (673,508) 15. Analysis of changes in cash and cash equivalents Increase in cash in the period 1,381,380 310,766 Decrease/(Increase) in net debt 164,149 (200,631) Increase in cash and cash equivalent 1,545,529 110,135 16. Approval of Financial Statements The financial statements of the Party were approved by the Trustees of The Labour Party on.. 15