NATURE TRUST (MALTA) ANNUAL REPORT AND FINANCIAL STATEMENTS 31 December 2011

Transcription

1 ANNUAL REPORT AND FINANCIAL STATEMENTS 31 December 2011 CONTENTS PAGE Council's report 1 2 Independent Auditor's report 3-4 Net Income statement 5 Balance sheet 6 Statement of movement in reserves 7 Notes to the financial statements 8-14

2 ,0 '1 NATURE TRUST (MALTA) THE COUNCIL'S REPORT The Councils presents its report and the audited financial statements for the year ended 31 December PRINCIPAL ACTIVITIES Nature Trust (Malta) is a non-governmental organisation, which was launched by His Excellency the President of the Republic in January 1999, following the merger of three environmental organisations. The Organisation's core objective is the protection of nature in the Maltese Islands by promoting environmental awareness, and identifying and managing areas of natural and scientific interest. REVIEW AND RESULTS During the year, Nature Trust (Malta) continued to increase its environmental education awareness programme mainly through the Ekoskola and YRE Programmes. It has also managed to finalise the Nature Park and Sustainable Development Centre at Xrobb l-ghagin. The organisation registered a deficit for the year of 10,128 mainly due to the additional costs incurred in the run up to the finalisation of the Xrobb l-ghagin project. MEMBERS OF THE COUNCIL The following have served as the members of the Council's Executive Committee during the year under review. Vincent Attard - President Dr. Hubert Theuma - Honorary General Secretary Orland Bonavia - Finance Secretary (Resigned on 31 October 2011) In accordance with the Nature Trust (Malta)'s statute, the Council Members are eligible for reelection at the Organisation's Annual General Meeting.

3 THE COUNCIL'S REPORT - continued STATEMENT OF COUNCIL' RESPONSIBILITIES The Council is required to prepare financial statements for each financial period which give a true and fair view of the Nature Trust (Malta) 's state of affairs, as at the end of the financial period and of the its surplus or deficit for that year. In preparing these financial statements, the Council is responsible for ensuring that: appropriate accounting policies have been consistently applied and supported by reasonable and prudent judgments and estimates; the financial statements have been drawn up in accordance with adequate Reporting Standards; the financial statements are prepared on the going concern basis unless it is inappropriate to presume that Nature Trust (Malta) will continue its activities. The Council is responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of Nature Trust (Malta). They are also responsible for safeguarding its assets and for taking reasonable steps for the prevention and detection of fraud and other irregularities. AUDITOR A resolution to reappoint Dion Borg FIA MIT CPA MIFSP CeFA MBA (Maastr.) as auditor will be proposed at the forthcoming Annual General Meeting. Vincent Attard President Hubert Theuma Honorary General Secretary Wied Ghollieqa Environmental Centre University of Malta Tal Qroqq 10th March 2012

4 Annual Report and Financial Statements -31 December 2011 INDEPENDENT AUDITOR'S REPORT To the Members of NATURE TRUST (MALTA) Report on the Financial Statements I have audited the accompanying financial statements of Nature Trust (Malta), which comprise the balance sheet as at 31 December 2011, and the income statement, statement of movements in reserves for the year then ended, and a summary of significant accounting policies and other explanatory notes. The Council's Responsibility for the Financial Statements The Council is responsible for the preparation and fair presentation of these financial statements in accordance with adequate Financial Reporting Standards. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor's Responsibility My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with International Standards on Auditing. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

5 INDEPENDENT AUDITOR'S REPORT - continued In my opinion, the financial statements give a true and fair view of the state of affairs of Nature Trust (Malta) as at 31 December 2011 and of the deficit, and movements in reserves for the year then ended, are in accordance with International Financial Reporting Standards, and have been properly prepared in line with the Voluntary Organisations Act (CAP.492) Report on Other Legal and Regulatory Requirements I also have responsibilities under the Voluntary Organisations Act (CAP.492) to report to you if, in my opinion: the information given in the Council's report is not consistent with the financial statements; or adequate accounting records have not been kept; or the financial statements are not in agreement with the accounting records; or I have not received all the information and explanations I require for my audit; or I have nothing to report to you in respect of these responsibilities. Dion Borg FIA, MIT, CPA, MIFSP, CeFA, MBA (Maastr.) 6 A, Vecca Wharf St. Paul's Bay Malta 10th March 2012

6 NET INCOME STATEMENT page GRANTS & DIRECT INCOME Programs costs , , (97,276) (105,431) NET OPERATING INCOME Supporting services expenses 104,791 57, (114,923) (66,240) (DEFICIT) BEFORE OTHER INCOME Other Income (10,132) (8,722) (DEFICIT) FOR THE YEAR 7 (10,128) (8,712)

7 BALANCE SHEET Notes NON-CURRENT ASSETS Tangible assets 2 596, ,811 CURRENT ASSETS Inventories Receivables Cash at cash equivalents 4 26, ,441 45,087 12, ,925 53,120 CURRENT LIABILITIES Payables 171,682 6 (19,385) 257,899 (118,587) NET CURRENT ASSETS 152, ,312 NET ASSETS 749, ,123 RESERVES General Reserve Projects Reserves 154, , , , , ,123 The financial statements on pages 5 to 16 were approved and signed by the Council's Executive Committee on 10 March 2012 Vince Attard President Hubert Theuma Honorary General Secretary

8 STATEMENT OF MOVEMENT IN RESERVES General Projects Reserves Reserves Total Balance as at 1 January ,419 28,190 Pledged funds allocated to Reserves 1 80,226 Net deficit for the year (8,712) 201, ,226 (8,712) Balance as at 1 January , ,416 Pledged funds allocated to Reserves 447,689 Funds released to Net Income (61,588) Net deficit for the year (10,128) 373, ,689 (61,588) (10,128) Balance as at 31 December , , ,096

9 NOTES TO THE FINANCIAL STATEMENTS 1. ACCOUNTING POLICIES The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. a. Basis of preparation These financial statements are prepared in accordance with International Financial Reporting Standards, adapted where necessary, as indicated hereunder, to reflect the objectives and practices of Nature Trust (Malta). b. Income recognition Income is recorded and accounted for, as and when it is received or formally committed, for both generic and also specific initiatives. c. Foreign currencies Transactions and balances Foreign currency transactions are translated into the uro using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement,

10 1. ACCOUNTING POLICIES- continued d. Property, plant and equipment Property, plant and equipment, comprising buildings, plant, machinery and equipment are initially recorded at cost and are subsequently stated at cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of items. Subsequent costs are included in the asset's carrying amount, or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the organisation, and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred Depreciation is calculated on the straight line method to write off the cost of the assets over their estimated useful lives as follows: Sustainable Development Centre 10% Fixtures and fitting 10% Equipment 15%-20% The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. Land and buildings are not depreciated. An asset's carrying amount is written down immediately to its recoverable amount if its carrying amount is greater than its estimated recoverable amount. e. Impairment of assets Assets that are subject to depreciation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. f. Inventories Inventories are stated at the lower of cost and net realisable value. Net realisable value is the estimate of the proceeds therefrom, in the ordinary course of activities, less the costs of selling expenses.

11 1. ACCOUNTING POLICIES- continued g. Operating receivables Operating receivables are carried at original claim amount less provisions made for impairment of these receivables. A provision for impairment of such receivables is established when there is objective evidence that the organisation will not be able to collect all amounts due according to the set original terms. Bad debts are written off during the year in which they are identified. h. Cash and cash equivalents Cash and cash equivalents are carried in the balance sheet at face value. In the balance sheet, bank overdraft/s is/are included under current liabilities. Borrowings Borrowings are classified as current liabilities unless there is an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date. Taxation Nature Trust (Malta)'s income is practically derived entirely from grants and donations. Moreover the organisation deems it is exempt from income tax, since it falls within the scope of Part III, Art.12(1),(e) of the Income Tax Act (Cap.123), thus no tax provisions are made. 10

12 NOTES TO THE FINANCIAL STATEMENTS - continued 2. TANGIBLE FIXED ASSETS Premises Fixtures Equipment Total Cost AtUanuary ,412 8,695 45, ,178 Additions 425, ,691 At 31 December ,627 8,695 45, ,869 Depreciation At 1 January ,597 44,770 50,367 Charge for year 61, ,703 At 31 December ,588 6,467 45, ,070 Net book value At 31 December ,039 2, ,799 At 31 December ,412 3, , STAFF COSTS Wages 39,755 42,242 Social Security contributions 7,756 7,847 47,511 50,089 11

13 NOTES TO THE FINANCIAL STATEMENTS - continued 4. INVENTORIES Publications held for resale 26,154 12, RECEIVABLES Current: Other receivables 18,979 20,403 Grants receivable 34, ,451 Accrued income 11,096 11,646 Deposit on acquisition of tangible fixed asset 35,425 35, , , PAYABLES Operating payables 1, ,518 Accruals 18,299 4,069 19, ,587 12

14 NOTES TO THE FINANCIAL STATEMENTS - continued 7. CAPITAL COMMITMENTS Capital commitments that have been approved and contracted for by the Council. 46,587 46, FINANCIAL RISK MANAGEMENT Overview Nature Trust (Malta) has an exposure to the following risks arising from the use of financial instruments within its activities: Credit risk Liquidity risk Market risk This note presents information about the organisation's exposure to each of the above risks, policies and processes for measuring and managing risk, and the organisation's management of capital. Further quantitative disclosures are included in these financial statements. The responsibility for the management of risk is vested in the Executive Council. Accordingly, it is the Council who has the overall responsibility for establishing an appropriate risk management framework. Credit risk Credit risk is the risk of financial loss to the organisation if a debtor or counterparty to a financial instrument fails to meets its contractual obligations. Credit risk arises principally from the organisation's receivables and bank balances. The organisation's cash is placed with prime financial institutions. Receivables are presented net of impairment charges for bad and doubtful debts. Credit risk with respect to receivables is limited due to the established organisation involved. Moreover, the organisation has no concentration of credit risk that could materially impact on the sustainability of its operations. 13

15 NOTES TO THE FINANCIAL STATEMENTS continued Liquidity risk Liquidity risk is the risk that the organisation will not be able to meet its financial obligations as they fall due. The organisation's approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due. Generally, the organisation ensures that it has sufficient cash on demand to meet expected operational expenditure, including the servicing of financial obligations. Market risk Market risk is the risk that changes in market prices, such as foreign exchange rates or interest rates, will affect the fair value or future cash flows of a financial instrument. The objective of market risk is to manage and control market risk exposures within acceptable parameters, while optimising the return on risk. The organisation is not exposed to foreign exchange risk since all operations are conducted locally and financed in the organisation's functional currency. Fair values At 31 December 2011 and 31 December 2010 the carrying amounts of cash at bank, receivables, payables and accrued expenses reflected in the financial statements are reasonable estimates of fair value in view of the nature of these instruments. 14

16 INCOME STATEMENT GRANTS & DIRECT INCOME Grants Membership fees and sponsorships Educational activities Sale of items Xrobb l-ghagin Reserve Allocation 114,650 8,932 6,021 10,876 61, ,690 10,055 7,093 6,111 - to page 5 202, ,949 OTHER INCOME Net interest received - to page

17 OPERATING COSTS AND ADMINISTRATIVE EXPENSES SCHEDULE PROGRAM COSTS Protection and site management costs Activities and initiatives costs Cost of items sold 53,047 42,952 43,845 59, ,104 - to page 5 97, ,431 SUPPORTING SERVICES EXPENSES Wages Telecommunications Stationery and subscriptions Promotional expenses Professional fees General expenses Repairs and maintenance Transport Bank charges Depreciation provision 47,511 1, , ,703 50,089 2,331 1, , , ,730 - fo page 5 114,923 66,240 16