2012 Financials

[fly_tornado]

Volunteers like you Pete are what makes the RAA so great

 

Ar you guys still wading through those heavy tomes? Fallen asleep maybe?There's lots of us common unwashed folk waiting with baited breath for some gems of wisdom to fall. (Or bombshells, strike out that which does not apply)

It must require a supercomputer called "deep thought"........

[nomadpete]

Ouch !

 

but point taken.

 

Seriously, I'm just curious. I totally appreciate the investment of time, effort and cost that is being offered by our knowledgable analysts. When it comes to analysing account statement, I do not have the skills required to know what I would be looking at. Apologies to those concerned.

 

PeterT

 

 

[fly_tornado]

I have no financial training what so ever, I picked up on the revenue side being down a fair bit below what it should have been. This led to a discussion with the board who audited the membership figures.

 

Bingo, we go from 13000 members to less than 10,000.

 

I feel that I have made a positive contribution to the RAA.

 

I'll admit picking through the records is painful but at this point of time with the dysfunctional exec control of the board, its just about having a go until we can resolve the exec/board issue. This threads help explain why the exec/board needs a good shake up.

 

 

[nomadpete]

I have no financial training what so ever, I picked up on the revenue side being down a fair bit below what it should have been. This led to a discussion with the board who audited the membership figures.Bingo, we go from 13000 members to less than 10,000.

I feel that I have made a positive contribution to the RAA.

 

I'll admit picking through the records is painful but at this point of time with the dysfunctional exec control of the board, its just about having a go until we can resolve the exec/board issue. This threads help explain why the exec/board needs a good shake up.

Thanks FlyT,

 

Yes, it seems that a few things noted on these forums have resulted in 'coincidencidental' action by the board. It works when letters and phone calls have no effect! Can I thank you for us losing 30% of our members? Seriously though, thanks for your positive contribution. There are too many uncertainties in what the board feeds us. As a member, I feel somewhat helpless and that makes the anxiety caused by lack of board communication all the worse. But to go deeper int othe financials needs the work of people who have the ability and also the credibility if they bring an anomoly to light. Yes the board clearly needs a shake-up. Lets not shake them up too much though - we still need a functional board.

 

 

[AlfaRomeo]

. . . Yes the board clearly needs a shake-up. Lets not shake them up too much though - we still need a functional board.

A year's worth of giving grief to CASA so that RA-Aus loses the right to register aircraft does warrant some shaking up. So does not providing the members at the AGM their legal right to have a gander at the Financials. So does not providing the minutes of the AGM on time. So does the Board circumventing the Constitution and appointing an ordinary member to the Board without an election process . . . . I could go on.

 

If we got the slightest indication that the Board Exec in particular appreciated the error of their ways or the amount of damage that they have done to RA-Aus's reputation, or they actually apologised to the members for their unbelievably disastrous performance, then the shaking could indeed be very gentle.

 

But, this mob simply do not get it!

 

Having dropped RA-Aus into the deepest hole in in its history, their response is to put up the barricades and tell the members as little as possible, vilifiy anyone who asks questions with the ironic insult of "uninformed", delay facing the members as long as they dare and just tough it out.

 

How do they approach solving the crisis of aircraft grounded because of their ineptness? They have one part time person authorising registrations at a rate that is slower than registration renewals come due. Send the staff on holidays over Christmas/New Year and don't put out a call to every L2, L3 and L4 in RA-Aus to see if they can come to Canberra and assist with the fix. One Board Member rolls up his sleeves and gets stuck in to the paperwork when what we needed him to do was to manage the fix.

 

How do you change the attitudes of people who have been Board Members or employed at RA-Aus for over 10 years? People like David Caban, Paul Middleton, Myles Breitkreutz, Paul Middleton or Eugene Reid? Perhaps they have done enough and it's time for them to find something else to do?

 

When has the Board Exec really given us the facts on the situation with groundings? They give us platitudes like "We are winning the battle" when what we want is the facts so we can judge how it is going. They could have told us something along the lines of . . . at the Beginning of December, we had 425 aircraft (not real number - how would we know what that was?) with registrations past due date and that during the month of December, a further 400 aircraft registrations became due and in December, 175 registrations were approved. That would mean there were 650 aircraft grounded at the end of December, an increase in of 225. While these numbers are made up for the example they could be close to the facts. While January should show an improvement, I seriously doubt that they have made a significant impact on the number of aircraft on the ground.

 

Catching up is not enough. What they need to be is ahead of the game. The files of all aircraft due for registration in February should have been checked off and any deficiencies reported to the owners before the renewal becomes due. But, do you think this Board Exec understands that? Or is doing anything about it, like committing the level of resources needed?

 

Yes, they are volunteers but that does not put them beyond criticism when they are not doing the job required and the under-performance goes on over 12 months with no end in sight.

 

 

[octave]

So anyone found anything in the accounts? I now have a copy but I am not sure what I am looking for.

 

 

[FlyingVizsla]

I have summarised the financials into a spreadsheet and attempted some analysis. Any one who wants it PM me - it is in Excel 2010, but I can provide it in other formats. People who had requested the pdfs of the Annual Reports have received this spreadsheet.

 

Interesting things - the membership numbers were overstated from 2011 (11,079) when the number was less than 10,000. The cost of "Key Personnel" more than doubled in 4 years, but overall employee expenses went up only by 67%. Board expenses are approx $6,500 per board member. The value of RAA (per member) has risen from $162 in 2007 to $336. RAA has made a "profit" every year. The CASA grant has increased by only 16%, the membership has increased by 20%, the bank balance has nearly trebbled in 5 years. There were large expenditure on computers, equipment, furniture about the time the Brisbane office (which no longer exists?) was established. In 2008 2 year memberships (with $20 discount) were offered. The Treasurer didn't treat this money in advance and overstated the income for that year, so it appeared a very good year, the next year (without the pre-payments) looked woeful with only $64k surplus - thus the call for a fee increase. The Memberships in Advance was corrected in the next year - but did we need an increase?

 

Far more detail has been provided when Don Ramsay became Treasurer, and this gives far more to work with.

 

Without knowing what is in each category, and some things are not dissected, it is not possible to confidently analyse the performance of key elements eg cost of the magazine. There are some issues people have raised with me - 9th Feb is an opportunity to ask the Board for their explanations.

 

Sue

 

 

[Riley]

I have summarised the financials into a spreadsheet and attempted some analysis. Any one who wants it PM me - it is in Excel 2010, but I can provide it in other formats. People who had requested the pdfs of the Annual Reports have received this spreadsheet.Interesting things - the membership numbers were overstated from 2011 (11,079) when the number was less than 10,000. The cost of "Key Personnel" more than doubled in 4 years, but overall employee expenses went up only by 67%. Board expenses are approx $6,500 per board member. The value of RAA (per member) has risen from $162 in 2007 to $336. RAA has made a "profit" every year. The CASA grant has increased by only 16%, the membership has increased by 20%, the bank balance has nearly trebbled in 5 years. There were large expenditure on computers, equipment, furniture about the time the Brisbane office (which no longer exists?) was established. In 2008 2 year memberships (with $20 discount) were offered. The Treasurer didn't treat this money in advance and overstated the income for that year, so it appeared a very good year, the next year (without the pre-payments) looked woeful with only $64k surplus - thus the call for a fee increase. The Memberships in Advance was corrected in the next year - but did we need an increase?

 

Far more detail has been provided when Don Ramsay became Treasurer, and this gives far more to work with.

 

Without knowing what is in each category, and some things are not dissected, it is not possible to confidently analyse the performance of key elements eg cost of the magazine. There are some issues people have raised with me - 9th Feb is an opportunity to ask the Board for their explanations.

 

Sue

Thanks Suze ... it'll take a bit of 'gnawing' before I work out if I understand the implications but your overview of the numbers is much appreciated. Hopefully explicit queries at the meeting may result in some meaningful answers? (the glass is always half-full and I eternally live in hope). Thanks and cheers.

 

 

[Guest Andys@coffs]

This update curtesy of Ian updating the forum software to be able to embed tables thank you very much !!

 

Hi People

 

I received the accurate counts of membership numbers from the Admin leader at RAAus today and will provide it below for you to consider:-

 

Membership Counts

 

[TABLE][TR][TH] [/TH][TH]2008[/TH][TH]2009[/TH][TH]2010[/TH][TH]2011[/TH][TH]2012[/TH][TH]2Jan13[/TH][TR][TD]Flying[/TD][TD2]4635[/TD2][TD2]5416[/TD2][TD2]6344[/TD2][TD2]7368[/TD2][TD2]8995[/TD2][TD2]9703[/TD2][/TR][TR][TD]Non Flying[/TD][TD2]122[/TD2][TD2]139[/TD2][TD2]152[/TD2][TD2]163[/TD2][TD2]194[/TD2][TD2]203[/TD2][/TR][TR][TD]Other[/TD][TD2]131[/TD2][TD2]154[/TD2][TD2]191[/TD2][TD2]221[/TD2][TD2]222[/TD2][TD2]271[/TD2][/TR][TR1][TD]Percentage increase[/TD][TD2]undef[/TD2][TD2]16.9%[/TD2][TD2]17.1%[/TD2][TD2]16.1%[/TD2][TD2]22.1%[/TD2][TD2]7.9%(part yr)[/TD2][/TR1][/TABLE](Note the last % is a partial year and if we gross it up to a full year its about 16%....which tells us that year on year we have a business growing by 16% on average.......there are many others that could only dream of such growth!!)

 

That all said, there are a couple of things that stand out to me.

 

In the annual report the membership subscriptions and membership liability insurance are both obviously membership driven and in general if we see a 16% increase year to year in member numbers then I would expect to see the same for each of the lines previously mentioned, plus or minus a bit to allow for any timing issues....... but what I saw was

 

Member Subscriptions Revenue

 

[TABLE][TR][TH]Revenue Year [/TH][TH]2007[/TH][TH]2008[/TH][TH]2009[/TH][TH]2010[/TH][TH]2011[/TH][TH]2012[/TH][/TR][TR][TD]Change cmprd to prev yr [/TD][TD2]undefined[/TD2][TD2]29.9%[/TD2][TD2] -5.8%[/TD2][TD2] 25.0%[/TD2][TD2] 5.3%[/TD2][TD2] 12.4%[/TD2][/TR][/TABLE]

 

Member Liability Insurance Revenue

 

[TABLE][TR][TH]Revenue Year [/TH][TH]2007[/TH][TH]2008[/TH][TH]2009[/TH][TH]2010[/TH][TH]2011[/TH][TH]2012[/TH][/TR][TR][TD]Change cmprd to prev yr [/TD][TD2]undefined[/TD2][TD2]4.5%[/TD2][TD2] 6.9%[/TD2][TD2] -13.5%[/TD2][TD2] 23.6%[/TD2][TD2] 8.8%[/TD2][/TR][/TABLE]

 

Now I know that insurance was renegotiated at a point during that time and I also know there was the issue that SR found with prepayments being incorrectly treated but i would have expected a much closer correlation between each line and then the membership line as the raw driver, than what Im seeing in the detail above (accountants jump in here if my analysis is not correct cause my training isnt as an accountant.

 

If I take the total expenses line and divide by flying members then what I see is that in raw $ what it costs to run the business is decreasing

 

Cost per flying member

 

[TABLE][TR][TH]Revenue Year [/TH][TH]2007[/TH][TH]2008[/TH][TH]2009[/TH][TH]2010[/TH][TH]2011[/TH][TH]2012[/TH][/TR][TR][TD] [/TD][TD2]undefined[/TD2][TD2]$344.60[/TD2][TD2] $291.83[/TD2][TD2] -$318.65[/TD2][TD2] $265.66[/TD2][TD2] $250.51[/TD2][/TR][/TABLE]

 

Now this is not an accurate number, there are costs included in each $ amount above that are offset in additional revenue (ASIC's for Example) but it does tell us what the cost base is doing as membership changes. In otherwords its not the size of the $ that matter here merely what it is doing year to year. Unless I have it wrong what we see here is not a bad thing! But the poor alignment I mentioned above suggests to me that the results dont really stack up........Simplistically if membership increases by 16% in raw numbers I would expect subscription revenue to increase about the same 16% and insurance to do the same, unless the mix of new vs already here are vastly different in some way....

 

so thats about 30 minutes of looking anyone for any other views?

 

Andy

 

 

[webbm]

AlfaRomeo, totally agree with your post. It was well made and made a lot of great points.

 

I would have to respectfully disagree with this part of your post...

 

One Board Member rolls up his sleeves and gets stuck in to the paperwork when what we needed him to do was to manage the fix..

I think if a Board Member (or anyone for that matter) wants to volunteer his/her time to get us flying again then that's a pretty admirable thing to do, especially when compared with the actions of (at least one) other Board Member(s).

 

And it wouldn't surprise me if it was part of managing the fix. You can't fix something if you don't know how it's broken. Hopefully this Board Member getting his hands dirty will have a first hand idea of what has been going on and what the current state is. One would argue a task above a Board Member, but at the same time, I'm sure many questions directed at the Board at the General Meeting will be a a bit lower level than policy and governance.

 

Cheers.

 

 

[AlfaRomeo]

. . . I think if a Board Member (or anyone for that matter) wants to volunteer his/her time to get us flying again then that's a pretty admirable thing to do . . .

Of course all Board Members volunteer their time and Middo has volunteered more of his than anyone else in RA-Aus. My concern was that he was doing work which others could do but not doing the one thing that, as a member of the Executive we needed him to do. He can help to get us back in the air by doing the manual work himself or he can achieve a hell of a lot more by spending his valuable volunteer time as a manager getting many more people (than just 3) to help with the backlog.

 

And it wouldn't surprise me if it was part of managing the fix. You can't fix something if you don't know how it's broken. Hopefully this Board Member getting his hands dirty will have a first hand idea of what has been going on and what the current state is.

The problems with registrations was brought to the attention of Steve Runciman by CASA on 25th Novemebr 2011. If it wasn't broken then, it certainly was when CASA pulled the pin on 6 Nov 2012 after 4 audit failures in a year. We are almost at the 3 months mark since CASA acted and yet still we have a "huge backlog" according to Middo. Surely after one week you should have had a pretty good idea of what's broken and what resources you would need to get it fixed in a reasonable period of time?

 

What has been lacking all along was good management not to get into this situation and then good management to get out of it in a reasonable period of time. And in our Association, that good management must come from the CEO and the Board Executive.

 

 

[webbm]

Agree with all of that, but I wasn't talking about Middo, so that's probably how we disagreed. I'm talking about other Board Members that I suspect don't have a full idea of the state of RA-Aus at the administrative level, which concerns me.

 

On a side thought, are the CASA audit reports available to members? Can we go to the office and view them?

 

Cheers.

 

 

[JohnMcK]

Agree with all of that, but I wasn't talking about Middo, so that's probably how we disagreed. I'm talking about other Board Members that I suspect don't have a full idea of the state of RA-Aus at the administrative level, which concerns me.On a side thought, are the CASA audit reports available to members? Can we go to the office and view them?

 

Cheers.

Hi Webbm. The full text of the CASA Audit reports are Confidential between CASA and the RAA Board and Senior Management. The reports are very detailed and quite long. The latest report is 132 pages. The reason CASA wants it confidential is it names names of individuals, aircraft registration numbers and issues with those aircraft. There are also other matters that should not be made public in the interest of Natural Justice until the other party has had a chance to explain.

 

However the Board are aware of a FOI request to CASA, and as soon as a sanitised report is produced by CASA, the Secretary has stated he will immediately publish it on the RAA Web Site.

 

John McK

 

 

[webbm]

Thanks for the info John. Much appreciated.

 

 

[Guest Error404]

At a guess the Brisbane "office" was probably Lee's house :-)

 

 

[Guest ozzie]

I received a letter from Middo wanting more than what was actually required and then received an email from Catlin the Aircraft Database Administrator asking for just a single photo. I ignored Middo's letter and went with Catlin because of her position as admin and it all went well. Anyone else experience this. How much postage and stationary has Middo wasted? Not to mention wasted time duplicating requests, causing confusion by getting it wrong. Maybe he is only getting underfoot in the office and being a nuisance .

 

I wonder how his audit went. He had a change of rego number along the way with his Drifter, wonder if he updated his photos.

 

Ozzie

 

 

[fly_tornado]

poor Catlin, nothing worse than having someone "helpful" trying to do your job who you can't tell to stay home.

 

 

[John G]

Hi Everyone,

 

Due to a lot of requests by RA-Aus members in my local area I have decided to bite the bullet and attend the RA-Aus General Meeting at Queanbeyan on the 9th February.

 

I have had a number of people who trust my judgement request that I act as their proxy at the meeting.

 

I am happy to accept any proxies from members of this site who have not as yet made up their mind as to who should hold their proxy vote.

 

If you would like me to hold your proxy vote you need to complete it and Email it to me before Friday.

 

My details are:

 

Email

 

[email protected]

 

Details of proxy Holder: John Gardon

 

PO Box 154

 

Wardell NSW 2477

 

Member #5334

 

You also need to select whether you wish me to vote in a particular way on each question; or how I see fit, if you trust my judgement.

 

In addition to sending it to me, you need to send it to

 

[email protected]

 

by 09:30 on Friday or I suspect that it will be judged invalid.

 

Regards,

 

John Gardon

 

 

[kaz3g]

Post number 5...

 

Tell us what you stand for John... Or who you stand for.

 

Are you in favour of maintaining the status Quo or do yu see a need for significant change and better accountability to the membership?

 

Kaz

 

 

[FlyingVizsla]

I received the accurate counts of membership numbers from the Admin leader at RAAus today and will provide it below for you to consider:-Membership Counts

 

[TABLE][TR][TH] [/TH][TH]2008[/TH][TH]2009[/TH][TH]2010[/TH][TH]2011[/TH][TH]2012[/TH][TH]2Jan13[/TH][TR][TD]Flying[/TD][TD2]4635[/TD2][TD2]5416[/TD2][TD2]6344[/TD2][TD2]7368[/TD2][TD2]8995[/TD2][TD2]9703[/TD2][/TR][TR][TD]Non Flying[/TD][TD2]122[/TD2][TD2]139[/TD2][TD2]152[/TD2][TD2]163[/TD2][TD2]194[/TD2][TD2]203[/TD2][/TR][TR][TD]Other[/TD][TD2]131[/TD2][TD2]154[/TD2][TD2]191[/TD2][TD2]221[/TD2][TD2]222[/TD2][TD2]271[/TD2][/TR][TR1][TD]Percentage increase[/TD][TD2]undef[/TD2][TD2]16.9%[/TD2][TD2]17.1%[/TD2][TD2]16.1%[/TD2][TD2]22.1%[/TD2][TD2]7.9%(part yr)[/TD2][/TR1][/TABLE](Note the last % is a partial year and if we gross it up to a full year its about 16%....which tells us that year on year we have a business growing by 16% on average.......there are many others that could only dream of such growth!!)

[TABLE][TR][TH] [/TH][TH]2008[/TH][TH]2009[/TH][TH]2010[/TH][TH]2011[/TH][TH]2012[/TH][TR][TD]All above[/TD][TD2]4888[/TD2][TD2]5709[/TD2][TD2]6687[/TD2][TD2]7752[/TD2][TD2]9411[/TD2][/TR][TR][TD]Annual Rept[/TD][TD2]8745[/TD2][TD2]9240[/TD2][TD2]9641[/TD2][TD2]11079[/TD2][TD2]not stated[/TD2][/TR][TR][TD]"Missing"[/TD][TD2]3857[/TD2][TD2]3531[/TD2][TD2]2954[/TD2][TD2]3327[/TD2][TD2]?[/TD2][/TR][TR1][TD]Overstated by [/TD][TD2]79%[/TD2][TD2]62%[/TD2][TD2]44%[/TD2][TD2]43%[/TD2][TD2]?%[/TD2][/TR1][/TABLE]

 

I am not sure what they were counting for members on the Annual Reports - perhaps counting non-financial members or all members of affiliated Clubs? Those people who received my spreadsheet will need to update the membership numbers to those above (supplied to Andy) to get the sheet to recalculate the cost per member and value per member.

 

Sue

 

(hope my table making skills are as good as Andy's)

 

 

[fly_tornado]

Thanks for that.

 

Those numbers are pretty shocking. The exec has been dysfunctional for a long time.

 

 

[FlyingVizsla]

More on the Annual Reports:

 

I have found a mistake on my spreadsheet under "Plain English Version" - the employee expenses for 2009, 2010, 2011 & 2012 are wrong - the figures on the "Summary" page are correct, being a direct copy of the Annual Reports. Shift the figures over one & put in the correct 2009 & 2012. With the correct figures in you will see employee expenses have risen 106% since 2007, Key Personnel (whoever they are ....) have risen by 121%

 

I got on to the Australian Bureau of Statistics and retrieved the Table "6345.0 Wage Price Index, Australia" which is a summary of hourly rates for all States and industries, public and private for the financial years 2002 - 2012. I chose all wages in the ACT. There wasn't a "not-for-profit", and "Admin" was very similar. Wage increases per year are:-

 

 

 

 

 

 

 

[TABLE][TR][TD]Financial Year[/TD][TD]2007[/TD][TD]2008[/TD][TD]2009[/TD][TD]2010[/TD][TD]2011[/TD][TD]2012[/TD][/TR][TR][TD]% wage rise pa[/TD][TD]4.1%[/TD][TD]4.2%[/TD][TD]3.8%[/TD][TD]3.5%[/TD][TD]3.5%[/TD][TD]3.2%[/TD][/TR][/TABLE]

 

 

 

 

 

 

 

 

 

 

 

 

Overall a rise of less than 20% since 2007 Vs RAA's 121%. Before we jump to too many conclusions - there is no indication of the number of persons employed by RAA - they may have created some positions which would account for the increase. However John Mc indicated that large pay rises were approved.

 

The disclosure of remuneration for "Key Personnel" also does not indicate how many fall into that category. Nor does it indicate the nature of the "Post Employment Benefit" be it accrued leave, or termination benefit under the contract. This kind of benefit is used in contracts to retain staff - eg a cash bonus for each year of service. The Post benefit was $98,202 at 2012. So either the CEO never took leave or there was a termination benefit.

 

The cost to each member for employee expenses (including provisions for leave & Key personnel + benefits and Board costs) was approx $189.74 per annum.

 

Note that the Treasurer for each year was the INCOMING Treasurer eg Don Ramsay was elected Treasurer at the AGM FOLLOWING the year being reported on. I have had reports that SR was a capable Treasurer and may have been responsible for the further dissection of expenditure which has been so useful to us.

 

I was hoping to get our old magazines out to list who was Treasurer and their tenure. But I don't think I will get that done until after the Meeting.

 

All the best for Sat 9th Feb 2013.

 

Sue

 

I think my table building skills just left me - preview looks terrible.

 

 

[fly_tornado]

Uncle Eugene's financial analysis was always a bit "thread bare" compared to Sue's actual analysis.

 

 

[Powerin]

More on the Annual Reports:

 

I have found a mistake on my spreadsheet under "Plain English Version" - the employee expenses for 2009, 2010, 2011 & 2012 are wrong - the figures on the "Summary" page are correct, being a direct copy of the Annual Reports. Shift the figures over one & put in the correct 2009 & 2012. With the correct figures in you will see employee expenses have risen 106% since 2007, Key Personnel (whoever they are ....) have risen by 121%

Thanks Sue...did I do something wrong because with the corrected figures I get 67% rise in employee expenses?

 

 

[FlyingVizsla]

Thanks Sue...did I do something wrong because with the corrected figures I get 67% rise in employee expenses?

Put these figures in "Plain English" sheet B30 onwards. Should change the totals and then change the % (unless I didn't do the formula - I have been fiddling since) should be 106% (the figures are $$$s).

 

508211, 508729, 707943, 868396, 840690, 1075708