Professional Documents
Culture Documents
Progress: Through Reporting
Progress: Through Reporting
through reporting
IIRC Integrated Report 2015
IIRC Integrated Report 2015
Netherlands Denmark
UK Poland
Germany Ukraine
France Europe
Italy
Spain
Switzerland
Belgium Turkey
Africa
28
team members Canada
South Africa
Americas
USA
65
<IR> Business Network
Colombia
Brazil
organizations
223
<IR> Examples Database extracts
1,240
members of <IR> LinkedIn group
Asia South Korea
Japan
China
India
Sri Lanka
Singapore
Malaysia
4,467
followers of <IR> Twitter account
Australia
New Zealand
Making
progress
Inputs
Activities Outputs
Publications and Material that Networks,
events that provide explains the programmes and
guidance, benefits of <IR> to policy efforts that
Guide Connect training and report preparers, stimulate system
External factors
Internal factors
Outcomes
Funding Intellectual People Relationships Nature
Funds converted capital Capability-building Robust networks Planetary limits
to operations, reserves, Expanded body of across the IIRC and and global reach elevated in business
and intellectual capital research, guidance its networks to support engagement and investor decisions
and thought pieces and collaboration
Value created
Strengthens our Enhances our credibility, Enriches the knowledge, Accelerates our mission Advances a core element
For the IIRC
long-term viability and anchors our policy and skills and commitment through a ‘multiplier of our vision, namely
supports the continued engagement efforts and of our team effect’ across our to promote sustainable
delivery of our mission supports our access networks development
to funding
Complements similar Fosters awareness of Extends capability Mobilizes those with Promotes sustainable
agendas that promote <IR> and encourages building to IIRC a common interest in development through
For others
financial stability capital markets to supporters and promoting financial enhanced stewardship of
consider the full range aligns their efforts stability and improving environmental resources
of factors that drive or to the broader the management and processes
erode value goals of <IR> of resources
Responding to
global trends
Understanding key global trends, and how
<IR> fits within the overall political and
regulatory economy, is vital in ensuring
that <IR> is relevant and responsive to
today’s issues and tomorrow’s needs
An inclusive coalition
As a global coalition of diverse parties, we depend Providers of financial capital. Accountancy profession. Accounting
on meaningful and productive interactions with our An organization’s integrated report should bodies and firms are effective advocates
stakeholders. As shown in the value creation model explain to providers of financial capital of the <IR> movement. Their memberships
on page 6, strong relationships – in the form of how it creates value over time. On this and learning programmes provide
basis, it is critical that we understand numerous opportunities to influence
networks, strategic partnerships and collaborations
the information needs of the investor professional competencies and extend
– drive our activities and outputs forward in the community. Our engagement strategy <IR> adoption. Our Council, which
public interest. therefore focuses on direct consultation includes strong representation of the
with leading asset owners and others in accountancy profession, provides one
Our understanding of stakeholders’ the investment chain, as well as vehicle for engaging with this important
See our strategic needs and interests therefore impacts investor-led initiatives that align with stakeholder group. Through our
performance our strategic and operational <IR>. We emphasize those initiatives that memorandum of understanding with the
on pages 18-29 effectiveness. This section highlights relate to investor stewardship, corporate International Federation of Accountants,
important mechanisms for soliciting governance and longer-term investment. a critical ‘umbrella’ body, we are able to
stakeholder views and understanding their In terms of engagement channels, we solicit representative feedback on a
perspectives, which we have embedded pursue a variety of mechanisms. We liaise regular basis.
in our governance structures, strategy with investors and their networks for
Learn about our and normal activities. We do, however, input and advice. We also rely on
governance structure acknowledge the need to improve investor representatives on our Council
on pages 32-35
our formal collation, analysis and during biannual meetings and interim
communication of feedback received consultations. Our targeted meetings
– we will strengthen these areas in and conference appearances provide
the coming years. a third avenue for receiving input.
Framework developers and standard
Business and other reporter entities.
The International <IR> Framework was setters. Standard setters and framework Our primary
developed to help businesses and other
organizations prepare integrated reports.
developers introduce new disclosure
requirements and terminology as they mechanism for
During the Framework’s development,
we worked closely with IIRC Pilot
endeavour to fill reporting gaps. These
contributions can fuel the perception receiving substantive
Programme Business Network
participants to understand their reporting
among market participants of a ‘reporting
patchwork’. It is important, therefore, that
input from framework
challenges. We also collected and reporting initiatives work together in the
interests of clarity, coherence and
developers and
published feedback from report preparers
via a formal consultation process in 2013. consistency as appropriate. Our primary
mechanism for receiving substantive input
standard setters is
In the two years following the launch of the
Framework, we have continued to invite from framework developers and standard
setters is the IIRC-convened Corporate
the IIRC-convened
input from businesses and other reporting
organizations. Our various <IR> Networks Reporting Dialogue. We also engage
with these organizations through
Corporate Reporting
have proven to be effective channels for
public and private sector input, as has our Council participation and individual Dialogue.”
Council, which includes representatives memorandums of understanding.
of the business community. Conferences,
meetings and our LinkedIn group offer
other channels for business input.
Our management team prioritizes relevant Of the seventeen matters we identified We classify our material matters
matters according to how frequently they as relevant to our value creation, we have according to three connected themes:
arise, in practice or through interactions deemed ten to have a material influence.
• Value proposition of <IR>
with stakeholders, internally or externally. Some are risks that require careful
Drives adoption and attracts funding
The prioritization also reflects these management. Others are opportunities
and operational support
issues’ perceived likelihood and severity, on which we must capitalize to achieve
impact on strategy and potential influence a meaningful shift towards early adoption • Pace and scale of adoption
on other factors that drive or erode our of the International <IR> Framework Shows proof of concept and builds
ability to create value. In this way, relevant by 2017. momentum for broader uptake
matters are assessed for both their • Operational capability
individual and collective influence. The Helps manage risks and opportunities,
management team then presents the IIRC demonstrate the case for <IR> and fulfil
Board with its conclusions and bold ambitions
methodology for determining material
matters, for the Board’s review, challenge
and debate.
Relevant matters
or s
Material matters and Unde
int rstan
or t f rket eg
rat di
p ma e
y
ng hink
> i up
of
<IR S
e
dt
nk
Complex
<IR ng
n ity
uma s corporate re of
>
Ch p i
IIR source system or ting
re ability
cap
Eff f II nships
r
ec RC
dem estor
tive
for and
o
ela
>
Inv
nes
tio
<IR
Implementation
reputation of the IIRC
Credibility and
suppor t
base for <IR>
Adequacy
Evidence
funding
of IIRC
benefits
r e p a ted f
yo
Dem ke of s se
u pt a u si n
i n t d i b i li t
by b
o n <IR s
s
or t
eg r
e
str
Cr
le
ab
>
e
Res i ve
or t & t
of < p on si ve ne s s S u p p
r y en
I
& m R > to p olicy l at o
regu vironm
pr i >
se s
Su
en <I R
acr o en
policy
s t a bus
t h em e s
as
le r t y o f
in a in
te r
a
e b
ili
bl
es deve it a
s i lo p S u m al
mp m s
er a e nt f or
tive
Role of technolog y in
corporate repor ting
Credibility By misapplying the International <IR> Develop a body of leading practice through the <IR> Examples Medium
Database
1 2
of integrated Framework, some reports may fail to term
reports meet investors’ information needs Collate and present evidence on the benefits of <IR>
Encourage and promote external reporting awards, case studies
and benchmarking studies
Evidence base for Insufficient understanding of the Compile evidence, notably from academia, that demonstrates Medium
the business case for <IR>
1
<IR> benefits tangible benefits of <IR> to term
businesses, investors and broader Encourage, commission and promote research in such areas as
capital markets may hinder value creation, business and investor decision-making, and
mainstream adoption financial implications of <IR>
Continue to publish our ‘Creating Value’ series
Complexity <IR> is one among many reporting Clarify our message to ensure a better understanding of <IR> Short term
4
of corporate standards, frameworks and initiatives, Work through the Corporate Reporting Dialogue to explain how
reporting system leading some to consider it as yet reporting standards and frameworks align with and support <IR>
another reporting burden
Investor demand Insufficient demand from investors Build relationships with investors directly or through Medium
3
for <IR> could deter business adoption of <IR> intermediaries term
Work with institutional partners to develop and express the case
Pace and scale of adoption
Human resources Low headcount, competency gaps and Engage widely to identify opportunities for secondment, based Short term
6
capability broad workforce distribution constrain on an assessment of expert skills and roles required in our
our potential organization to execute our strategy
Adequacy of Current contributions and in-kind Prioritize IIRC funding efforts at CEO and Board level Short term
6
Operational capacity
IIRC funding support do not match our ambition, Identify and maximize both revenue streams and funding sources
restricting our ability to take full
advantage of the current momentum Establish a charitable foundation to receive funds from
for <IR> benevolent foundations or similar funds
Effectiveness of We have partners and peers, including Identify and progress opportunities to work with partners to drive Medium
<IR> awareness, advocacy and adoption through multiple points
6
IIRC relationships members of our coalition, who can term
help to build awareness of <IR> and of influence
advance our vision Review key relationships twice a year to ensure continuing
support and resources to execute our strategy
Achieving a
meaningful shift
The driver for establishing the IIRC
was the need for reporting to evolve
to meet the needs of the 21st century
1 4
Progress through dialogue:
Increase the pace and
Develop the Corporate
scale of <IR> adoption
Reporting Dialogue
See page 18
See page 24
2 5
Maintain the International Engage with
<IR> Framework, global policy makers
underpinned by leading and regulators
practice and guidance See page 26
See page 20
1
• Increased awareness of <IR> in key markets
• Demonstrate the business case and sectors
for <IR> and create conditions for • Increased likelihood of adoption
investor demand
• Increase in Framework-referenced reports
• Enhance business and investor
involvement in our work to reinforce
our market-led approach
30
the number of countries in
This was also evidenced through our
social media reach, with our number of
Twitter followers increasing 36% and our
LinkedIn group growing by 53%.
Increased likelihood of adoption. In April,
Outlook key
Major issues, requires attention
Issues identified, action being taken
No significant issues, on track
2
• Build the evidence base for the
benefits of <IR>
• Support the International <IR>
Framework with robust technical
guidance
<IR> Framework,
so are increasing
our commitment to
providing guidance
to the market.”
400
In November, we published Materiality Outlook key
in <IR> jointly with the International Major issues, requires attention
Federation of Accountants. This Issues identified, action being taken
publication explained the materiality No significant issues, on track
concept in the context of <IR>. It also
outlined Framework expectations with participants of roundtable
respect to disclosures on material matters sessions
and the corresponding materiality
63
determination process.
Supporting organizations also generated
independent and important thought
pieces. For example, Deloitte issued
its publication A Director’s Guide to
Integrated Reporting in March, and in submissions to our
November the International Federation formal consultation paper
of Accountants issued Creating Value
with Integrated Thinking.
on assurance
3
• Evaluate the impact of <IR> on corporate important to their investment decisions,
behaviour and capital allocation seeing <IR> as offering ‘investment
grade’ reports
• Investors recommend <IR> within their
investment portfolio
71%
of respondents considered
integrated reports to be
‘essential or important when
making investment decisions’.
Progress through
dialogue: Develop the 2015 Priorities How we evaluate performance
• Convene major reporting framework • Constructive exchange between reporting
Corporate Reporting developers and standard setters to standard setters and framework developers
provide market clarity and discuss the
Dialogue future of corporate reporting
• External perceptions of the Corporate
Reporting Dialogue
4
Constructive exchange between External perceptions of the Corporate
reporting standard setters and Reporting Dialogue. Feedback from the
framework developers. We are also business community on the Landscape
Material engaged in – and have to date acted Map was generally favourable, with
matter as convenor of – the Corporate Reporting companies referring to the output as a
Dialogue. Meetings in March, May and useful navigational tool. Bloomberg also
November informed and united voiced its support: “The growth of
participants around issues of common corporate reporting has brought greater
interest. The initiative delivered its first visibility into corporate performance, but
Complexity of the major output in May, in the form of a also a challenge in sorting through the
corporate reporting web-based Landscape Map. The group variety of reporting approaches available
system initiated a second project, aimed at today. We welcome this landscape map as
clarifying the similarities and differences a tool that promotes greater alignment
between materiality approaches, in the between corporate reporting frameworks
second half of 2015 and published the and standards.”
results in the first half of 2016. In
Notwithstanding this positive
November, a panel of Corporate Reporting
feedback, resource constraints
Dialogue participants spoke of the
limited market transparency and the
benefits of collaboration at our Official
breadth and timeliness of outputs.
<IR> Convention. Despite these
We aim to strengthen transparency
achievements, resource constraints
and accountability in 2016.
impeded the initiative from reaching its
full potential, an issue to be addressed
in 2016.
We welcome this
landscape map as
a tool that promotes
greater alignment
between corporate
reporting frameworks
and standards.”
Progress is positive
but could be greatly
enhanced by
additional resourcing
in 2016 and beyond.”
www.corporatereportingdialogue.com
5
• Explicit reference to <IR> in policy
regulators and policy makers and regulatory initiatives
• Seek support from governments and • Explicit alignment between <IR>,
other regulatory authorities to accelerate corporate governance and stewardship
<IR> adoption in a way that meets market
needs, laws and customs
Develop a long-term,
viable organization 2015 Priorities How we evaluate performance
• Transition to a new governance model • Future ability to fund planned/budgeted
• Secure long-term funding activities and initiatives
6
• Secure endorsement from • Capacity to plan, implement and
supranational bodies account for activities taken to achieve
strategic objectives, within budget
and in conformance with sound
governance practices
Material
matters Future ability to fund planned/budgeted The staff team comprised 28 full-time
activities and initiatives. Our financial equivalents, with directly employed and
performance in terms of income & seconded staff spanning 12 countries.
expenditure during the year was 74% Although we were able to run our
better than budgeted, with the deficit operations smoothly and perform core
being close to break-even at £99k (2014: activities, our level of funding impeded
Human resources £71k). Income was 1.6% below budget at our broader ambitions.
capability £1,412k, but this shortfall was more than
Capacity to plan, implement and
offset by reducing expenditure (by 17.5%
account for activities taken to achieve
in relation to the budget) to £1,513k.
strategic objectives, within budget and
Adequacy of Other elements of our contributions
in conformance with sound governance
include pro bono facilities and
IIRC funding practices. In recognition of the need to
secondments to the staff team. In-kind
enhance the IIRC’s governance structure
support of the provision of office premises
to support the organization’s long-term
valued at £111k was the same as
Effectiveness of budgeted and in 2014. Secondments
viability, and having consulted extensively
with our Council, we completed the
IIRC relationships were unfortunately under budget,
adoption of a new Constitution and
averaging 9.5 full-time equivalents,
appointment of a new Board in 2015.
compared with the 10.9 budgeted.
We continued to evolve our internal
Cash reserves at year end were £894k policies and procedures, particularly in
(2014: £1,096k), the reduction being relation to reporting to our Board on
due mainly to timing differences of performance relative to strategy, work
annual receipts. plans and budget. These improvements
also enhanced the effectiveness of our
communication with Council members.
We will undertake a stakeholder survey in
mid-2016 to better understand broader
market perceptions of <IR> and the IIRC.
£734,407
Other contributions
£721,327
£8,882
Other income
£nil
£1,412,491
Total
£1,467,469
15%
49%
Progressing
high standards of
corporate behaviour
Near term Longer term Despite incremental progress in risk
and environmental accounting, we believe
We entered 2016 with a sense of We see a gradual but important shift by
that corporate reporting can do more to
optimism. The policy arena is more capital market regulators and others
embrace the evaluation and management
receptive than ever to the ideology towards encouraging and enforcing high
of other factors that materially drive or
underpinning <IR> and the benefits it standards of corporate behaviour. Proof
erode value. Financial performance is,
offers. For example, initiatives aimed at of this is seen in a growing emphasis on
after all, part of a broader canvas of
reducing reporting volume, complexity governance codes, such as the UK’s
resources that must be managed
and clutter, such as the IASB Disclosure Corporate Governance Code and investor
holistically rather than in isolation.
Initiative, are well supported by local stewardship codes, such as that found
Historic agreements in 2015, such as
efforts in Australia, the United Kingdom in Japan. Japan’s Stewardship Code,
the Paris Agreement on greenhouse gas
and other regions. The Financial Stability in particular, recognizes corporate value
emissions at COP 21 and the adoption
Board’s Task Force on Climate-related and sustainable growth as a shared
of the 2030 Agenda for Sustainable
Financial Disclosures is committed to responsibility between a company’s
Development, are invaluable contributions
an aggressive work plan to which we management and its institutional
to this important shift in mindset. We see
will contribute. investors. These and other regional
strong alignment between <IR> and the
developments reinforce the purpose of
See 2016 outlook We will continue our policy efforts at the aim of the United Nations’ Sustainable
for each of our disclosures, namely to improve decision
B20 level during the Chinese Presidency Development Goals. Both encourage
Breakthrough Phase making among all participants of the
of the G20 to ensure that <IR> remains entities to consider impacts and
strategic themes corporate reporting and investment
on pages 18-29. on the agenda. We also plan to engage dependencies on a broader set
chain. The act of reporting therefore
with the Secretariat of the 2017 German of resources.
shifts from one of mere compliance to
G20 Presidency.
one that strengthens interactions across
organizational silos, considers significant
trade-offs between the capitals on which
the business has a reliance or effect and
reduces information asymmetry between
the users and seekers of financial capital.
Collective
influence
and expertise
We are committed to an inclusive,
market-led approach to build on the
extensive interest in <IR>
71
organizations represented
on our Council
Core themes of current Council is our initial barometer for public sentiment and
strategy market demand for guidance
1 Increase the pace and scale of <IR> adoption
Investors on governance bodies inform our engagement
2
Maintain the International <IR> Framework,
with providers of financial capital
underpinned by leading practice and guidance
3
Build a bridge from corporate reporting to Council members fortify our relationships with regulators
capital allocation and policy makers
4
Progress through dialogue: Develop the Corporate
Reporting Dialogue Robust governance structures and processes build our
5 Engage with global policy makers and regulators credibility, institutional integrity and lines of accountability.
These attributes enhance market acceptance of our
6 Develop a long-term, viable organization outputs and allow entrance to global policy discussions.
The quality and diversity of our Board also enrich our
strategic decisions.
Activities
Experience and diversity of Council members ensure
Guide Explain the purpose, application and expectations we understand and appropriately connect to regional
of <IR> and global developments
Connect Link <IR> to other concepts, priorities
and developments Senior representation on Council enhances our market
Convene Gather participants of the reporting and investing credibility and convening power. Council meetings are
landscape to learn, exchange and collaborate a prime example of convening opportunities.
Value creation
We are committed to an inclusive, Key features of the new structure are Board of Directors
market-led approach to build on the as summarized on page 35 and codified
Our new Board was appointed in October
extensive interest in <IR>. This approach in our revised Constitution. We present
2015. It includes 11 non-executives,
draws on the collective influence and select aspects of our governance structure
all eminent leaders whose individual
expertise of many stakeholders, including in this section and indicate vital links to
backgrounds and combined experience
the users, preparers and beneficiaries of our ability to create value.
reflect our broad constituency base.
corporate reporting.
Council The skills and diversity of Board members,
Our governance structure, processes and as shown below, lend healthy debate,
At year end, our Council included guidance and discipline to such
internal culture were founded on this
senior representatives of 71 member activities as strategic development
market-led strategy, as well as our
organizations. Their breadth of views, and risk management.
reliance on effective partnerships
depth of experience and commitment to
to fulfil our mission. We revised our
governance structure in 2015 to further
<IR> continue to be instrumental to our IIRC team
strategic implementation. Council
our aim of ensuring a long-term, viable Two sets of values guide the way we work.
meets twice annually to provide input to
organization. The changes, which reflect Our brand values support the delivery of
our plans and priorities. These meetings,
extensive consultation with our coalition, our mission and vision and show how we
which rotate across jurisdictions, provide
strike an important balance between the want to be seen by our stakeholders.
Learn about the an opportunity for wider engagement with
legal authority and responsibilities of our
individuals that make local stock exchanges, regulatory bodies Our internal culture is defined by four
up the IIRC on our Board and the significant weight and
and businesses on the path to <IR>. organizational values: respect, attitude,
website influence of our Council.
Council meetings also reinforce the professionalism and truth. These values
value of <IR> and highlight areas for define how we do what we do and ensure
further development, prioritization we work cohesively and collaboratively.
and risk management.
View our brand values
on the inside front
cover of this document
Composition of IIRC Council by communities their
organizations represent
4%
7%
8%
30% Accountancy Profession
Business and Other Reporter Entities
18% Academia
24%
Accountancy Profession 5
Civil Society 4
0 3 6 9 12
The IIRC
Learn more about our
Governance structure Operating Company
in our Constitution
Governance and
Board of
Council Nominations
Directors
Committee
Remuneration
Committee
CEO and
IIRC team
Advisory
groups and
task forces
Activities
Council • Appoints and removes Board members • Meets four or five times annually
Learn more about • Includes Board or senior executive • Serves as the Council’s proxy, its and engages with management
our Council members level designates from coalition parties members serving as members of on strategic matters
on our website
• Meets twice annually to relay broad the Operating Company • Staggered rotation allows (re-)
market views • Provides input on risk management appointment of one-third of members
• Provides input to the IIRC and finance matters each year, subject to term limits
on strategic matters • Staggered rotation allows (re-) <IR> Framework Panel
• Chair attends Board meetings appointment of one-third of members • Members appointed by the Board
as an observer each year, subject to term limits • Recommends to the Board revisions
Advisory groups and task forces Operating Company or updates to the International
Find a full list of our • Offer support, advice and expertise • Legal, not-for-profit entity established <IR> Framework
Directors on page 39 on IIRC initiatives and activities in 2011 • Provides input on other guidance
of the Appendix
• Members are drawn non-exclusively • Coordinates our activities as requested
from Coalition parties on Council and initiatives • Staggered rotation allows (re-)
• Provide input to the IIRC on Board of Directors appointment of one-third of members
strategic matters each year, subject to term limits
• Has final authority and responsibility
• Activities are defined by terms for the affairs and governance of Remuneration Committee
of reference the Operating Company • Reviews executive performance
• Directors participate on an individual, and remuneration
Governance and Nominations
Learn more about Committee honorary, non-remunerated and CEO and IIRC team
our Board members • Members appointed by Council non-executive basis • CEO represents the IIRC team in
on our website • Includes the CEO as an ex all Board dealings
• Meets three times annually to
advise the Board, Council Chair officio director • Support and coordinate IIRC’s activities
and CEO on governance
arrangements and practices
We believe that <IR> is a process that should Finally, we hoped that in sharing this table, • Communicate more effectively the
evolve over time. As we neared completion of we might enhance readers’ navigation of connections between our strategy and
our Integrated Report 2015, we took stock of our content and assist fellow preparers of resource allocation (Paragraph 3.3)
its content and presentation using the integrated reports. • Improve our collation and analysis of
accompanying table. This discipline and stakeholder feedback to clarify legitimate
Based on the following analysis, we are
attention to detail proved helpful in assessing needs and interests and communicate our
committed to strengthening our internal and
our alignment with Paragraph 1.17 of the corresponding responses (Paragraph 3.10)
external reporting, both in terms of our report
International <IR> Framework. More
content and the process underpinning our • Refine our internal performance
importantly, we viewed this exercise as an
integrated report. In particular, we see measurement to support information
opportunity to identify and communicate areas
opportunities for improvement in the reliability and traceability
for improvement in a transparent way. After all,
following areas: • Simplify and improve alignment between
this is our first integrated report and we know
there is room for us to improve. our internal and external reporting
We invite feedback on our integrated report at
report@theiirc.org
This publication was published by the International Integrated Reporting Council (‘the IIRC’). It may be downloaded free of charge for personal use only from the IIRC
website: www.integratedreporting.org. The IIRC does not accept responsibility for loss caused to any person who acts, or refrains from acting, in reliance on the material
in this publication, whether such loss is caused by negligence or otherwise. Copyright © September 2016 by the International Integrated Reporting Council (‘the IIRC’).
Paul Druckman,
Director
report to the members of material inconsistencies with the audited financial statements
and to identify any information that is apparently materially
incorrect based on, or materially inconsistent with, the knowledge
International Integrated acquired by us in the course of performing the audit. If we
become aware of any apparent material misstatements or
Reporting Council inconsistencies we consider the implications for our report.
We have audited the financial statements of the International Opinion on financial statements
Integrated Reporting Council (IIRC) for the year ended 31
December 2015 which comprise the Comprehensive Income In our opinion, the financial statements:
Statement, the Statement of Changes in Equity, the Statement of • give a true and fair view of the state of the company’s affairs as
Financial Position, the Statement of Cash Flows and the related at 31 December 2015 and of its deficit for the year then ended
notes numbered 1 to 12.
• have been properly prepared in accordance with IFRS as
The financial reporting framework that has been applied in their adopted by the European Union, and
preparation is applicable law and International Financial • have been prepared in accordance with the requirements of
Reporting Standards (IFRS), as adopted by the European Union. the Companies Act 2006.
This report is made solely to the Directors, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act Opinion on other matters prescribed by
2006. Our audit work has been undertaken so that we might the Companies Act 2006
state to the Directors those matters we are required to state to
them in an Auditor’s Report and for no other purpose. To the In our opinion, the information given in the Directors’ Report for
fullest extent permitted by law, we do not accept or assume the financial period for which the financial statements are
responsibility to anyone other than the company and the prepared is consistent with the financial statements.
company’s members as a body, for our audit work, for this report,
or for the opinions we have formed. Matters on which we are required to
Respective responsibilities of directors report by exception
and auditors We have nothing to report in respect of the following matters
where the Companies Act 2006 requires us to report to you if, in
As explained more fully in the Statement of Directors’ our opinion:
Responsibilities, the Directors are responsible for the preparation
• adequate accounting records have not been kept, or returns
of the financial statements and for being satisfied that they give a
adequate for our audit have not been received from branches
true and fair view. Our responsibility is to audit and express an
not visited by us; or
opinion on the financial statements in accordance with
applicable law and International Standards on Auditing (UK and • the financial statements are not in agreement with the
Ireland). Those standards require us to comply with the Auditing accounting records and returns; or
Practices Board’s Ethical Standards for Auditors. • certain disclosures of Directors’ remuneration specified by law
are not made; or
Scope of the audit of the financial • we have not received all the information and explanations we
statements require for our audit.
• the Directors were not entitled to take advantage of the small
An audit involves obtaining evidence about the amounts and companies’ exemption from the requirement to prepare a
disclosures in the financial statements, sufficient to give Strategic report.
reasonable assurance that the financial statements are free
from material misstatement, whether caused by fraud or error.
This includes an assessment of whether the accounting policies
are appropriate to the entity’s circumstances and have been
consistently applied and adequately disclosed, the Steve Gale FCA,
reasonableness of significant accounting estimates Senior Statutory Auditor
made by the Directors, and the overall presentation
of the financial statements. For and on behalf of
Crowe Clark Whitehill LLP
Statutory Auditor
London
22 September 2016
2015 2014
Notes £ £
Income 3 1,412,491 1,467,469
Retained
surplus
£
Balance at 1 January 2014 871,531
Deficit for the year (71,491)
Retained
surplus
£
Balance at 1 January 2015 800,040
Deficit for the year (99,098)
2015 2014
Notes £ £
ASSETS
CURRENT ASSETS
Trade and other receivables 9 224,487 151,550
Prepayments and accrued income 33,401 18,820
Cash and cash equivalents 10 893,692 1,096,124
1,151,580 1,266,494
EQUITY
ISSUED CAPITAL AND RESERVES
Retained surplus 700,942 800,040
LIABILITIES
CURRENT LIABILITIES
Accruals and deferred income 11 393,178 345,887
Trade and other payables 11 57,460 120,567
450,638 466,454
Approved by the Board and authorized for issue on 21 September 2016 and signed on its behalf by
Paul Druckman
Director
Company registration number: 07746254
2015 2014
£ £
Total operating (deficit)/surplus (101,002) (72,167)
Decrease/(increase) in trade and other receivables (87,518) 210,692
(Decrease)/increase in trade and other payables (16,087) (247,765)
2. Accounting policies
Income recognition
Income is recognized to the extent that it is probable that the economic benefits will flow to the IIRC, and the income can be reliably
measured. All such income is reported net of VAT where applicable.
Network contributions
<IR> Business Network, <IR> Technology Initiative, and <IR> Public Sector Pioneer Network contributions are accounted for as income
in the accounting period to which they relate.
Other contributions
Other contributions are accounted for as income in the accounting period to which they relate.
Foreign currency exchange
Transactions in currencies other than the functional currency of the IIRC are recorded at the rates of exchange prevailing on the dates
of the transactions. At each statement of financial position date, monetary assets and liabilities that are denominated in foreign
currencies are retranslated at the rates prevailing on the statement of financial position date. Non-monetary assets and liabilities
carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was
determined.
Gains and losses arising on retranslation are included in net surplus or loss for the period, except for exchange differences arising on
non-monetary assets and liabilities where the changes in fair value are recognized directly in equity.
Tax
Contributions from the Business Network participants, Council members and other organizations are not subject to corporation tax.
The IIRC is required to pay corporation tax on any banking and investment income received in the year.
Trade and other receivables
Trade and other receivables are recognized by the IIRC based on the original invoice amount less an allowance for any uncollectible or
impaired amounts. Other receivables are recognized at fair value.
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank, cash in hand and short-term deposits. Short-term is defined as being three months
or less.
Trade and other payables
Trade and other payables are initially measured at fair value, and subsequently measured at amortized cost, using the effective interest
rate method.
Standards in issue not yet adopted
The financial statements have been prepared on the basis of accounting standards, interpretations and amendments effective from 1
January 2015. The IIRC has concluded that there are no relevant standards or interpretations in issue not yet adopted which will have a
material impact on its affairs.
Estimates and judgements
An estimate for doubtful debts is made when collection of the full amount is no longer probable. Bad debts are written off when they
are identified as being bad.
1,412,491 1,467,469
4. Operating surplus
Operating surplus/deficit is stated after charging the following:
2015 2014
£ £
Auditor's remuneration - audit services 7,500 6,000
Net foreign currency exchange gains (6,609) (2,805)
5. Employee expenses
2015 2014
£ £
Wages and salaries 750,432 754,520
Post-employment expense for defined contribution plans – 6,188
Social security costs 91,587 90,813
842,019 851,521
The IIRC has an average monthly total of 28 staff members (2014: 25). Nine of these are employees (2014: ten) and 14 are seconded
(2014: 15) by supporter organizations, of which 12 (2014: 13) are on a pro bono basis. In addition, four consultants (2014: three)
and one volunteer (2014: nil) were engaged by the IIRC.
The average monthly number of employees during the year was made up as follows:
2015 2014
No. No.
Executive 1 1
Other 8 9
9 10
6. Tax
Components of tax expense
2015 2014
£ £
Current corporation tax charge 584 519
Financial liabilities
Accruals 78,014 81,388 78,014 81,388
Trade and other payables 24,482 89,761 24,482 89,761
2015 2014
£ £
0-30 days 57,120 69,550
30-60 days 115,367 10,000
60-90 days 52,000 30,395
Greater than 90 days – 41,605
The above balance represents cash and cash equivalents for the purposes of the statement of cash flows as at 31 December 2015.
450,636 466,454
2015 2014
£ £
0-30 days 24,441 71,190
30-60 days – 15,915
60-90 days – –
Greater than 90 days 41 2,656