avatar OXFAM Transportation, Communications, Electric, Gas, And Sanitary Services

Pages

  • Page 1

    Oxfam Annual Report and Accounts 2001|2002


  • Page 2


  • Page 3

    ANNUAL REPORT AND ACCOUNTS 2001/2002 CONTENTS Oxfam Corporate Directory 2 Trustees’ Report – Objectives and Activities 3 – Chair’s Review 4 – Director’s Review 6 – Treasurer’s Review 12 – Organisation and Corporate Governance 21 Auditors’ Report 24-25 Consolidated Statement of Financial Activities 26 Summary Income and Expenditure Account 27 Balance Sheet 28 Consolidated Cash Flow Statement 29 Notes to the Accounts 30-54 Oxfam Registered Office 274 Banbury Road Oxford OX2 7DZ Telephone: (+44) (0)1865 311311 www.oxfam.org.uk A company registered in England, number 612172, and limited by guarantee. Registered Charity No. 202918 Oxfam (also known as Oxfam GB) is a member of Oxfam International. 3


  • Page 4

    OXFAM CORPORATE DIRECTORY Oxfam Council of Trustees as at 30 April 2002 and 30 September 2002 Rosemary Thorp (Chair) Norman Sanson Stan Thekaekara was appointed during the year. Lord Joel Joffe Dino Adriano (Vice-Chair) Angela Sealey retired during the year. Frank Kirwan (Treasurer) Hugo Slim Jackie Gunn Matthew Sparrow Sir Richard Jolly Stan Thekaekara Scarlett MccGwire Shriti Vadera The following, who are not Trustees, hold honorary positions: Amartya Sen (Adviser) Michael Behr (Trustee Emeritus) Michael Rowntree (Chair Emeritus) Robin Langdon-Davies (Association Member Emeritus) Oxfam Association as at 30 April 2002 The following, who are not Trustees, are members of the Association of Oxfam: Charles Abugre Fiona Campbell Patrick Elliott Kate Kirkland Daniel Alexander Nicholas Colloff Jean Higham Maureen Smith Maggie Baxter Brian Coutanche Alison Hill David Sunderland Lord Bhatia Bruce Crowther Jim Howard Selvavinayagam Vireswer Terry Brenig-Jones Jenny Drury Lord Judd of Portsea Peter Winters Principal Professional Advisers Oxfam’s principal professional advisers include the following: Principal Clearing Bankers: The Royal Bank of Scotland Group Auditors: Critchleys, Oxford Principal Solicitors: Linnells, Oxford Bates, Wells and Braithwaite, London Corporate Management Team Oxfam’s Corporate Management Team comprises: The Director (Chief Executive): Barbara Stocking, CBE Finance: David Nussbaum Marketing: John Whitaker Human Resources: Jane Cotton Policy: Justin Forsyth (Appointed April 2002) International: Stewart Wallis Trading: Chris Coe Company Secretary: Joss Saunders 4


  • Page 5

    TRUSTEES’ REPORT: OBJECTIVES AND ACTIVITIES 1. OBJECTIVES AND ACTIVITIES Oxfam works with others to overcome activities. Oxfam receives funds from poverty and suffering. many generous donors who make regular monthly donations. Further donations are Oxfam’s principal objectives as stated in received in response to advertisements, its statutes are “to relieve poverty, distress mailings, and other appeals. An important and suffering in any part of the world” proportion of Oxfam’s unrestricted income and “to educate the public concerning the comes from the profit on the sale of nature, causes and effects of poverty”. donated second-hand goods, sold through Oxfam shops. Within these overall objectives we focus on five key aims: The British government and the European ■ Sustainable livelihoods Union donate money to Oxfam under their co-funding and disaster relief ■ Quality education and health care schemes. Funding is also received from UN agencies for specific emergency ■ Protection from disasters and violence projects, and from the Community Fund. ■ Right to be heard Oxfam runs a Fair Trade programme ■ Right to equity: gender and diversity through which it facilitates market access for producers in developing Oxfam works in more than 75 countries, and markets and distributes countries. The charitable programme food and drinks. Fair Trade products are includes advocacy, education, and sold through the Oxfam shops and other campaigning work on issues that are outlets. Oxfam’s Fair Trade activities central to the achievement of Oxfam’s are part of the charitable programme charitable objectives. and are not conducted solely as a commercial activity. Oxfam’s Grants List gives brief details of grants made by Oxfam during the Oxfam’s wholly owned subsidiary year. This publication is available on company, Oxfam Activities Limited, trades request from Oxfam’s Registered Office. as Oxfam Trading and Oxfam Wastesaver, Contact the Oxfam Library on 01865 and also undertakes other fundraising 313757 for more information. activities. Oxfam Trading buys goods, such as Christmas cards, from commercial The money to fund this work is raised suppliers, and sells them in Oxfam shops. throughout Britain and overseas, with Oxfam Wastesaver receives unsold the support of thousands of volunteers second-hand items (mainly lower-quality who help to run Oxfam shops and assist clothing) from the shops, that are recycled in campaigning, fundraising, and other at its plant in Huddersfield. 5


  • Page 6

    2. CHAIR’S REVIEW This report covers the year ending in Oxfam’s great strength, to my mind, April 2002, although I took over the has always lain in our country privilege and responsibility of chairing programmes, which show deep sensitivity Oxfam’s Trustees only on December 1 to individual countries’ own goals and 2001. Therefore, I am incorporating the needs, and include the close involvement views of the outgoing Chair, Joel Joffe. of our partners. For good reasons we have moved to a regional structure, with Let me first pay tribute to Joel since, eight international regions and the UK without doubt, his leaving was a major Poverty Programme. These regional event in the year. Joel was an outstanding offices depend on local knowledge and and totally committed Chair, and a hard loyalty to and respect for the people act to follow. His wisdom, kindness, and with whom they work. I am happy to humour were celebrated by all at his record that so far, in my visits overseas final Oxfam AGM in November 2001. and in the time I’ve spent with staff, His passion for cost-effectiveness and I am finding a strong resonance efficiency was only outdone by his passion with my view of the way we should for justice and for Oxfam’s work. He has be working. left a deep imprint that we appreciate, and for which we thank him. Another ‘particular mission’ is to make a reality of our boast that the Joel’s valedictory speech informed us legitimacy and power of our advocacy how convinced he was that Oxfam was lies in the fact that it is rooted in our in a strong position to face the future, programme. The Director’s Review and I in no way disagree. In the late 1990s describes the Trade report, Rigged we set in motion a radical change of Rules and Double Standards, which is structure and shift in culture, with which a major achievement of this year. It is both Joel and I were much involved. The a powerful, even brilliant, document. task of today is to follow these through However, in writing it, we had to work to a conclusion, so we can start to reap hard to make the links between the the dividends. Anyone who has ever been research and our programme. I was involved in it will know that cultural glad to be with the team in West Africa change does not come easily. My personal as the launch of the Trade report commitment on coming into office is approached, and to see the many ways to see that this process continues, but in which these links are starting to be my particular mission is to ensure that made. It was a pleasure to spend time in the drive for efficiency, for scaling up with the local team in the north of the impact of our programme, and for Senegal and to see how a group of peasant greater impact through advocacy, we do farmers were beginning to understand not lose the connection with our roots – how they might, themselves, fight to that is our work with poor people in change the terms in which they engage many countries. with the wider economy. 6


  • Page 7

    TRUSTEES’ REPORT: CHAIR’S REVIEW Another goal I have had this year is to see the strength and authority of see progress in the working of Oxfam the International Division in action International. This grouping of eleven during this complex time. The new Oxfams is at once a thrilling opportunity, Director, Barbara Stocking, could have a source of strength, above all in advocacy complete confidence in her team – and a challenge, as we combine the as she walked what was, for her, organisations’ different agendas and uncharted territory. grapple with the additional demands that result from working collaboratively. I am This brings me to staff: it has been a happy to report that reforms in ways of delight to accompany Barbara in the working are already under way. fastest settling-in that anyone in Oxfam can remember. She gives brilliant and We all know where we were on always caring leadership, and the staff’s 11 September. I was in Dhaka, Bangladesh, support, from the Corporate Management with the Regional Management team Team onwards, has been total. I can for South Asia. During this grim time, only feel humbled in the face of the I watched the new regional team integrity and commitment of all, as I coordinating well with management get closer to this organisation. That goes in the UK, and saw the whole organisation for volunteers too, not least my fellow kicking into gear to appraise the Trustees, and all our partners. Thank situation, its implications at all levels, you to all for the work we’ve done this and the part Oxfam might play. It was year, and to each and every one of the good, in my role as incoming Chair, to donors who make it all possible. 7


  • Page 8

    3. DIRECTOR’S REVIEW During my first year as Director of Oxfam GB, the organisation responded to humanitarian crises caused by major conflicts and disasters – unfortunately much as usual. But no-one could have anticipated the most notable, which came in the aftermath of the terrorist attacks in the USA on September 11. September 11 and beyond The first areas of concern for us were Afghanistan and the wider Central Asia region. Oxfam GB has been working in Afghanistan since 1979 and, despite the very difficult environment, we had played a major part in the response to drought during the three most recent years. Immediately after September 11 we expected massive movements of people within the country and as refugees, but in the event these did not happen – not least because Pakistan and Iran would not open their borders. A small number of refugees reached the camps in Chaman, Pakistan, and we were able to give them support. Our role was to provide water and sanitation but, because of the desert conditions, the people in those camps still live in the most appalling circumstances. In addition, our staff knew that several millions of people would need food supplies to see them through the harsh Afghan winter. Once the US-led coalition began its attacks in Afghanistan, it became extremely difficult to distribute food because of fear of the convoys being looted by the Taliban or bombed, or simply because the truck drivers were unwilling to enter the country. At the same time as providing practical help in the region, we worked hard to make the public aware of the plight of ordinary Afghan people. And while expatriate staff were told to leave Afghanistan, our Afghan staff continued distributing as much food as they could, throughout the period of bombing. By late October, it had become clear, from World Food Programme statistics and Photo, right: Afghan reports from our staff, just how little food was reaching people in need. After careful refugees in North Pakistan consideration we, with all other members of the Oxfam International family, and with Photo credit: Annie Bungeroth several other British agencies, called for a pause in the bombing so that we could get


  • Page 9

    TRUSTEES’ REPORT: DIRECTOR’S REVIEW food into the country before the winter. We did not get the pause we had asked for, but as a result of the wider international awareness of the severity of the crisis, there was a much greater determination to get food into the country, resulting in a massive increase in food entering Afghanistan from the end of October. Fortunately too, the Taliban regime fell much faster than anyone, including military strategists, predicted, and fighting ended in most areas of Afghanistan, though there was – and is still – great insecurity. As a result, our programmes were able to become fully operational again. We are proud that we played such a major part in bringing attention to the dire humanitarian situation and in getting food to people. However, none of us should be complacent; the suffering of the people of Afghanistan during the winter of 2001/02 was heartrending. According to a variety of recent estimates, based on extrapolating confirmed data from displaced person camps, there were some 20,000 (and possibly more) “excess” deaths this winter as an indirect (that is, not as a result of bombing and fighting itself) result of the war. In this case, “excess” means over and above what would have been expected as a result of the drought itself. But even this statistic does not describe the tremendous privations inflicted on the people, nor reveal the horror of children as young as six being sold to get a little money to buy food for others. We are undertaking two evaluations of our input: the first to get a better understanding of what really happened to people, although accurate figures will never be obtainable; and a second to analyse our decision-making processes through this period. Further humanitarian responses One of our concerns throughout Autumn 2001 was the disregard for International Humanitarian Law and the Refugee Conventions. This concern became greater as the Middle East conflict escalated. While it is not our role to comment on the conflict Oxfam tanker delivering itself, we did produce a public statement about the humanitarian consequences, water to communities including our witnessing of the destruction of water supplies to ordinary people in affected by the volcanic eruption in Goma, the Occupied Palestinian Territories, in blatant disregard for International Feb 2002 Humanitarian Law. Photo credit: Alison Hood


  • Page 10

    Following a critical independent evaluation of our response to the earthquake in Gujarat, India, in January 2001, we learned lessons and were able to respond much more speedily and through local partners when communal violence flared up there in February 2002. A number of humanitarian situations this year, including that precipitated by the Nyiragongo volcano eruption in Goma, Democratic Republic of Congo, have shown us that we need to reshape the way we respond. All eight of our international regions are now investing more in preparing communities to cope with disaster and in ways of working through partner organisations. As the capacity of our regional offices increases, we are also in the process of changing responsibilities between the central humanitarian department in Oxford and the local Oxfam staff. We are known as a leading agency in humanitarian work, and if we are to maintain that reputation we need to improve continually. At the same time as responding to humanitarian needs, we are doing more to highlight the causes of conflict. In particular, this year in relation to Africa we have made presentations in the United Nations Security Council “arria” sessions on both the Democratic Republic of Congo and Angola. In both countries, as with Sudan and Sierra Leone, the control of natural resources – such as oil, diamonds, minerals e.g. coltan, and timber – is a central issue. We have also strongly lobbied the British government on the arms trade, including suggesting changes to the UK Export Control Bill, to make sure that human rights and sustainable development are considered in countries to which the UK exports. More widely, we are beginning to work in a global coalition to control the trade in small arms which is so devastating to many people in developing countries. Developing livelihoods This year has seen a turning point in bringing our development programmes together under Oxfam’s five main aims. We are now beginning to see larger- Photo credit, this page: scale programmes tackling particular issues in a region (for example, girls James Hawkins


  • Page 11

    TRUSTEES’ REPORT: DIRECTOR’S REVIEW education in West Africa), bringing direct programme work together with advocacy on policy. This year also saw considerable change to our livelihoods programme. Oxfam has a strong focus on ensuring that poor people can claim their rights to assets such as land, fishing grounds, and micro-credit. We need to maintain this activity, but also extend our work into helping people gain access to markets, whether local or global. We are still defining this wider livelihoods strategy, but have begun a number of initiatives, including development of a market access resource centre in northern Ghana. Recognition of what we have to do on livelihoods came, in part, from analysis of our role in the Fair Trade movement. From that review, it became clear that by acting as the direct buyers, shippers, and distributors of goods into our 800 shops, we were not maximising our impact on poor people’s lives. We are not a large enough trader to be cost-effective in shipping and distribution, which is why we now buy our Fair Trade goods through other Fair Trade suppliers, such as Traidcraft and Cafédirect. Also, many of the non-food goods sold poorly in our shops. We recognised that this decision to change the way we support trade could have devastating consequences for individual producers if we took away our orders and gave them no alternatives. A major programme of work was put in place, therefore, to move producers to new buyers. By the end of the financial year this had proved very successful, and we are now finding alternative support for the two or three producers for whose goods there was no other market. It was essential to handle this transition carefully, but in the end it cannot be right to buy goods for which there is no market. The campaign trail Our commitment to livelihoods has also taken us deeply into the issue of how trade affects poor people in our globalised world. Trading is a central part of poor people’s lives, and trade can help poor people out of poverty. However, the rules of trade, as they currently operate in the world, are often rigged against poor people. On April 11, with Oxfam International, we launched a well-researched report on trade and began our Photo credit, left: Barney Haward, three-year campaign to Make Trade Fair. That day, there were launch events in 22 cities right: Ami Vitale


  • Page 12

    across the world, which received impressive media coverage. There is a very long way to go to make the public and decision-makers aware of the issues and to bring about change, but already, with others in the Trade Justice Movement, we sense opportunities to achieve progress. We had considerable success this year in bringing about changes through our other lobbying and campaigning work, almost always done in alliances and coalitions with partners and other agencies. Oxfam, through our Education Now campaign, is a member of the Global Campaign for Education which has had impressive results towards achieving our aim of providing universal primary education by 2015, although the money promised by developed countries has not yet been delivered. At the World Bank/IMF Spring Meetings, a financing framework was agreed, with plans to fast-track aid for the ten to fifteen countries which had developed action plans for education. This would bring many more children, especially girls, into primary education. Our Cut the Cost campaign to increase access to medicines took up a good deal of time, but resulted in a number of pharmaceutical companies, especially GlaxoSmithKline, changing their approach on drugs for poor people. We were pleased too that at the World Trade Organisation meeting in Doha, Qatar, it was accepted that a public health emergency should override patent controls so that essential generic drugs could be produced in country. We are still lobbying for an additional clause that, given the same circumstances, would allow countries that cannot produce their own generic drugs to import them from elsewhere. HIV/AIDS has provided a dramatic example of the impact that long patents have on poor people’s lives because they cannot afford the medicines which they need. Fundraising success Of course, all our work depends on our ability to raise funds. We raised an impressive £124 million from our funding and investment activities, and were still able to increase the number of our committed donors by 100,000. Perhaps the best news on income was the turnaround in the contribution from our shops. Their overall income was up on the Photo credit, this page: previous year, allowing for an £11 million contribution to programme. We have to be James Hawkins


  • Page 13

    TRUSTEES’ REVIEW: DIRECTOR’S REVIEW careful how we judge this increase because High Street trading as a whole did well during the year, but our figures are better than the average. We believe that this has been achieved by giving shop staff greater freedom to respond better to the local environment. Our second-hand book sales, including internet sales, have done particularly well. Set for the 21st century Finally, we always need to sharpen up how we work internally, to make the greatest impact with our human and financial resources. As I began in Oxfam, I said to staff that I wanted the organisation to be described as one which is “modern, professional, and gets things done”. This has meant tightening up on our financial controls and reporting practices, especially internationally, and looking again at the way we reward and treat our staff and volunteers. We are now in the middle of a global review of our rewards system. Most importantly, I was talking about a change in culture in which people spend less time on analysis and more on delivery, taking greater personal responsibility for getting things done. I was clear when I took up the post as Director that I did not want to see more major structural change. There have been several such restructurings in the last few years and so it is now time to let things settle and to concentrate on delivering the results that we set out to achieve. It has been a pleasure and a privilege to see this beginning to happen this year. In the midst of so much change though, the organisation has had less time to look outside itself. We all recognise that this state of affairs needs to be remedied. That’s why we ended the year with plans for a Strategic Stocktake. It will focus particularly on how the outside world is changing and whether Oxfam is evolving and adapting well enough to have the greatest impact on poverty, not just now, but in the next five to ten years, and on into the future.


  • Page 14

    4. TREASURER’S REVIEW Results for the year The results for the year are presented in the form of a Statement of Financial Activities, prepared in accordance with the Statement of Recommended Practice (SORP), “Accounting and Reporting by Charities”. Incoming resources Oxfam’s total income was £189.4 million in the year ended 30 April 2002, £2.1 million more than the previous year. 2002 2001 Increase/(Decrease) £m £m £m Trading sales 65.1 61.6 3.5 Donations, appeals, and legacies 73.5 65.9 7.6 Disasters Emergency Committee Appeals 1.2 3.0 (1.8) 74.7 68.9 5.8 Income for specific programmes 30.3 36.3 (6.0) Donated Food Aid 16.0 18.2 (2.2) 46.3 54.5 (8.2) Investment and other income 3.3 2.3 1.0 Total income 189.4 187.3 2.1 Trading sales of £65.1 million were and £4.4 million (72%) after exceptional £3.5 million (5%) higher than last year, costs. Trading improved in profitability in driven by increased turnover from the year from both sales growth (£3.5 donated goods. Trading costs amounted million) and decreases in the cost base to £54.6 million (2000/01: £55.5 million). (£2.6 million). During the year Oxfam’s This includes £3.2 million (2000/01: management undertook a programme of £1.5 million) exceptional costs for cost cutting and developed new strategies implementing decisions taken following for the Fair Trade activities and sourcing reviews of the operational and of donated products. These are expected management costs of the trading to result in further improvements in and Fair Trade activities. profitability in future years. Oxfam's trading activities contributed Donations, appeals, and legacies £10.5 million towards charitable continued to show strong growth with expenditure, an increase of £6.1 million income increasing 12% to £73.5 million (80%), before exceptional costs, on 2000/01 (2000/01: £65.9 million) while associated 14


  • Page 15

    TRUSTEES’ REPORT: TREASURER’S REVIEW costs increased by 35% to £18.4 million Trading 2002 2001 2000 £m £m £m (2000/01: £13.6 million). The rise in income was due to the continued Profit on trading activities 10.5 6.1 9.2 success of Oxfam's fundraising activities. Trading sales 65.1 61.6 57.9 The amount raised through regular Trading profit margin 16% 10% 16% monthly donations (committed giving) grew by 14%, while that from legacies grew by 8%. Trading profit margin has increased from 10% in 2000/01 to 16% this year. The There was one Disasters Emergency improvement is due to improved sales of Committee appeal during the year for donated products and implementing the the volcano eruption in Goma, Democratic results of the reviews of our trading and Republic of Congo. Oxfam took £0.1 million Fair Trade operations. To put these figures from this appeal and received a further into context, the trading margin reported £1.1 million for previous years’ appeals. by Marks & Spencer for the year 2001/02 This compared with £3.0 million received was 7.9%, and that of Tesco, 5.6%, reflecting during 2000/01. the contribution of volunteers to our trading operation. Income for specific programmes (restricted) totalled £30.3 million, a Fundraising decrease of £6.0 million (17%) on 2000/01. Total fundraising costs amounted to £19.9 This was principally due to there being million, an increase of £4.9 million (33%) fewer major emergencies for which Oxfam on 2000/01, reflecting a strategic decision received funding from institutional donors to invest in this activity to ensure that during the year. Consequently, Oxfam Oxfam has the money available to meet received £4.6 million less income from the the challenges we will face in the future. UK Department for International Development, £2.9 million less from the members of Oxfam International, but £1.0 Fundraising 2002 2001 2000 £m £m £m million more from non UK governments. Again this year we saw an exceptionally Donations, appeals, and legacies 73.5 65.9 61.4 high level of donated food aid with food Fundraising Costs* 18.4 13.6 12.4 valued at £15.8 million received from the Return per pound spent 4.0 4.8 5.0 World Food Programme. This enabled Oxfam to respond to the food crises in Kenya, Sudan and Afghanistan. The return on each pound spent has *Excludes £1.5 million (2000/01: £1.4 million) declined this year. This is a result of spent raising income for fundraising investment being increased specific programmes Cost of generating funds by £4.8 million (35%) in 2001/02 in order from institutions such as Trading the European Union. to deliver the increased income in future Trading costs totalled £54.6 million. years which is needed to expand the These costs include rent and other international programme. The ratio is property costs, staff, product sourcing expected to improve in coming years as expenditure, and exceptional costs of this year’s fundraising activities will £3.2 million. continue to generate further income. 15


  • Page 16

    For instance, once recruited, Oxfam’s ■ Fits into at least one of Oxfam’s committed givers typically remain active five strategic aims; donors for many years. Sustainable livelihoods Quality education and health care The fundraising costs represent 25% Protection from disasters and violence (2000/01: 21%) of the income raised Right to be heard from “donations, appeals, and legacies” Right to equity: gender and diversity (see above). ■ Complies with UK charity law and, for Our fundraising strategy is to continue humanitarian projects, complies with to build long-term secure and reliable Red Cross and NGO Code of Conduct income streams. During the year we and Sphere Standards; continued to review our major fundraising ■ Is the best, or at least a good enough, methods to ensure an appropriate technical solution; will be implemented balance between efficiency, level of donor cost-effectively; meets Oxfam’s restriction, and diversity of income procedural, accountability, and sources. The review confirmed our focus reporting requirements; and meets on increasing the number and value of restricted donor’s expectations and regular monthly supporters (committed reporting requirements. giving). The value of the donations provided by these supporters preserves Gifts in kind distribution of £16.0 million Oxfam’s independence and enables us to (2000/01: £18.3 million), principally food plan significant long-term development aid, was £2.3 million less than 2000/01 programmes and to respond to manmade although it remained higher than previous and natural emergencies. years. The level of food aid distribution can vary significantly from year to year Charitable expenditure depending on overseas food shortages. Charitable expenditure decreased by During 2001/02 Oxfam managed major £13.5 million (11%) to £112.2 million. food distribution programmes in This decrease was entirely within our Afghanistan, Kenya, and Sudan. funding from restricted income. The decrease in restricted expenditure was The cost of activities in furtherance principally due to there being fewer of the charity's objects (“operational major emergencies for which Oxfam programmes”) has decreased by £16.9 received funding from institutional million to £50.6 million in the year. donors during the year. The £54.3 million The level of grants payable in furtherance spend from unrestricted income was of the charity's objects (“non operational £4.3 million (9%) more than the programmes”) has decreased by £0.8 previous year. million to £15.3 million. Oxfam’s grant making policy ensures The cost of supporting Oxfam’s inter- that its expenditure meets its charitable national programme was £27.3 million objectives and aims. Oxfam reviews (2000/01: £21.8 million). Support costs potential grants against the following represent the cost of Oxfam’s core field criteria: offices and the costs incurred by GB-based 16


  • Page 17

    TRUSTEES’ REPORT: TREASURER’S REVIEW Spend by region* (previous year’s percentage in brackets) Photo credits, left to right: Toby Adamson, Howard Davies, Crispin Hughes, Geoff Sayer West Africa East Asia 9% (6%) Horn, East, and 9% (7%) Central Africa *Spend by region covers overseas operational 25% (26%) and non operational grants and overseas support costs. It excludes food aid, UK based Central America, programme activities, Mexico, and the UK support costs and Caribbean the cost of managing 10% (7%) and administering the charity. South America South Asia 11% (8%) 13% (17%) Middle East, Eastern Europe, Commonwealth of Independent States Southern Africa 11% (12%) 12% (17%) Photo credits, left to right: Toby Adamson, Crispin Hughes, Shailan Parker 17


  • Page 18

    Spend by aim* (previous year’s percentage in brackets) Right to equity: gender and diversity 5% (5%) * Spend by aim Right to be heard Protection from disasters and violence classifications are 10% (10%) 50% (40%) part of an internal management information system based on planned expenditure. The grant approval system covers Quality education overseas expenditure and health care on operational and non- operational grants and 15% (20%) gifts in kind. It excludes information, campaigning, and education expenditure, support costs, and the cost of managing and administering the charity. Sustainable livelihoods 20% (25%) Photo credits, left to right: Sean Sprague, Crispin Hughes, Jim Holmes, Shailan Parker, Howard Davies


  • Page 19

    TRUSTEES’ REPORT: TREASURER’S REVIEW staff, directly providing support for to Oxfam. Oxfam Activities Limited has Oxfam’s international programme. This a 25% interest in cafédirect limited includes management, policy and (a company registered in Scotland with advocacy work, technical support, and registration number 141496), which logistics. To manage a programme in 75 promotes Fair Trade primarily through countries is intrinsically more expensive the marketing and distribution of tea than to manage a programme in, say, ten and coffee. countries, and these additional resources are required to ensure that we are Living on the Line Limited, a wholly complying with procedures and control owned subsidiary of Oxfam (registration systems, identifying optimal technical number 3549003), was formed to raise solutions, managing operational funds by means of trading activities for programmes, monitoring partner the On the Line project, but it did not expenditure, and ensuring that Oxfam trade during the year. is being cost effective in its purchasing activities. The increase in support costs reflects a variety of structural and Oxfam International operational changes. These include Oxfam (also known as Oxfam GB) is a attaining full operational capacity in member of Oxfam International, a our eight regional management centres, separate legal entity registered in the higher remuneration to address increased Netherlands as a charitable foundation demand and competition for skilled (registration number 41159611). Oxfam staff in developing countries, and International encourages and co-ordinates additional support for humanitarian joint activities with ten other affiliated interventions. These changes are designed international agencies, each separately to provide Oxfam with the capacity to constituted under the appropriate manage a more extensive overall national regulations. Most of these use programme effectively. the name ‘Oxfam’, and all share many common values. To achieve the maximum The cost of managing and administering impact on poverty, the Oxfams link up the charity was £3.0 million, an increase their work on development programmes, of £1.0 million on 2000/01. Half of this humanitarian response, lobbying for increase (£0.5 million) was due to pension policy changes at national and global charges.The remainder was primarily the levels, and popular campaigns and result of the costs of additional resources communications aimed at mobilising in internal audit and supply management. public opinion for change. Oxfam GB received grants from and made grants to Subsidiary undertakings members of this group. During the year Oxfam has a wholly owned subsidiary, Oxfam received income of £6.7 million Oxfam Activities Limited, which raises (2000/01 £9.6 million) from the other funds by means of trading activities. members of Oxfam International and Oxfam Activities Limited made a profit made grants of £2.5 million (2000/01 of £1.7 million (2000/01: £0.1 million), £0.6 million) to them. The reduction in before interest on working capital of grants received was principally due to £0.2 million (2000/01: £0.4 million) paid fewer major emergencies during the year. 19


  • Page 20

    Reserves was a £1.2 million surplus of unrestricted income over expenditure in 2001/02, Reserves policy compared with a £0.6 million deficit in The Council of Trustees has established a 2000/01. In addition, a combination of general reserves policy to ensure that the reduction in the prior year’s unspent Oxfam can maximise the impact of its unrestricted operational grant balances programme for beneficiaries and maximise and excess depreciation over capital the value of its net income. General expenditure enabled £3.7 million to be reserves provide some protection to the released from designated funds into organisation and its charitable programme General Reserves. Overall this increased and provide time to adjust to changing the balance of General Reserves to financial circumstances. This limits the £21.8 million. General Reserves are risk of disruption to the programme in represented by net current assets and the event of a downturn in some of are equivalent to approximately two Oxfam’s various sources of income or months’ unrestricted expenditure at an unexpected need for additional 2001/02 levels. expenditure. The policy also provides parameters for future strategic plans, and The actuarial valuation of Oxfam’s contributes towards decision making. pension scheme at 30 April 2002, for the purposes of FRS 17, showed a funding During the year the Council of Trustees deficit of £15.4 million (see Note 21 d). reviewed Oxfam's reserves policy. The FRS 17 does not currently require this review established an appropriate range for deficit to be set off against general reserves, the level of general reserves. This was based but even allowing for such a on a risk assessment of the probability set off, Oxfam would still be reporting and likely impact on Oxfam’s charitable positive general reserves. The cash flow programme of disruption from financial required to meet the £15.4 million deficit distress due to a decline in income, an relates to future pension payments. It is inability to meet financial obligations, or therefore expected to arise over the long an inability to reduce expenditure in the term rather than in the immediate future, immediate short term. In addition, the and the amount of the deficit is subject review confirmed that Oxfam’s level of to considerable variability because it general reserves was neither too high nor depends on a range of demographic and too low when measured against financial assumptions which are likely to comparable international development change over time. The Trustees plan to charities and other leading charities. The continue to grow general reserves to general reserves range will be reviewed provide additional cover against this annually to reassess the risks and reflect future liability. changes in Oxfam’s income, financial obligations, and expenditure. Designated Funds (unrestricted) Designated Funds are those unrestricted General Reserves (unrestricted) funds that have been allocated by the General Reserves are not restricted or Trustees for particular purposes. designated, as are the other funds, for use on a particular programme or for some The Designated Fund for Fixed Assets other defined or designated purpose. There of £15.8 million represents resources 20


  • Page 21

    TRUSTEES’ REPORT: TREASURER’S REVIEW invested in the charity’s fixed assets invests in fixed term or call deposits with that are therefore not available for a high security rating and either fixed other purposes. interest rates or a fixed relationship to base rate. Equity investments are nominal in Other Designated Funds of £0.4 million amount and are held only to support are set aside by Trustees to cover specific Oxfam’s advocacy and lobbying activities. operational programmes (not funded by The Council of Trustees reviews Oxfam’s restricted income) which have not been investment policy annually. completed by the year-end. During the year the average return earned The amount transferred from Designated by the charity’s investments was 4.5% Funds to General Reserves in the year was against an average base rate of 4.5%. £3.7 million, being £1.4 million from the Designated Fund for Fixed Assets and £2.3 million from Other Designated Funds. Fixed assets In order to support its programme Restricted Funds management, fundraising, administration, These funds are tied to particular purposes. humanitarian development, and support activities, Oxfam owns tangible assets Restricted Funds of £14.8 million represent in the form of leasehold and freehold unspent monies received from donors property (shops, depots, offices, and subject to the conditions specified by warehouses), office and computer them. These funds may arise because of equipment, and vehicles. At 30 April 2002 restrictions on their use required by the the total value of these assets was £15.7 donor at the time of receipt or because the million, an analysis of which is given in funds were collected in a public appeal to Note 9 to the accounts. raise money for a particular purpose. They are not therefore available for use in other Oxfam work. Financial position The Council of Trustees considers that Endowment Funds there are sufficient reserves held at the Endowment Funds of £1.6 million year end to avoid an unacceptable level of represent monies received from donors disruption to the organisation in the event where there is some restriction on the of a downturn in future income, and that power to utilise the capital (see Note 18). there is a reasonable expectation that Oxfam has adequate resources to continue in operational existence for the foreseeable Investment policy future. For this reason, the Council of Oxfam's investment objective is to Trustees continues to adopt the going- maximise the return on its investment concern basis in preparing the accounts. funds while maintaining maximum security and a high degree of liquidity Risk management to allow for an unexpected need for additional expenditure, for example in The Council of Trustees has overall response to a major humanitarian responsibility for Oxfam’s system of emergency. To meet this objective Oxfam internal control. Such a system of control 21


  • Page 22

    can provide only reasonable and not priority internal audit recommendations absolute assurance against errors or and reports annually to the Council of fraud, given the rudimentary nature of Trustees on the adequacy of the control communications, institutional, and environment. The most recent such report financial infrastructure in many parts identified scope for improvement which is of the world in which Oxfam operates. being actioned by management. There is clear delegation of authority from the Trustees through the Director and The Council of Trustees was, and remains, Corporate Management Team to the rest satisfied that systems are in place to of the organisation. monitor, manage, and mitigate Oxfam’s exposure to major risks. It considers that A review of the risks faced by Oxfam was maintaining Oxfam’s general reserves at conducted by the Council of Trustees the levels stated above, and the reviewing and senior management during the past of controls over key financial systems year. This review identified the major carried out through an internal audit strategic and operational risks that Oxfam programme will provide Oxfam with faces and the ways in which they are adequate risk assurance and sufficient being monitored, managed, and mitigated. resources in the event of adverse Where the review identified specific conditions. It also recognises that the control weaknesses, management strategies nature of some of Oxfam’s work requires have been established to strengthen these active acceptance and management of controls. In future, as part of the annual some risks when undertaking activities business planning process, the major in order to achieve the objectives of risks identified by management will be the charity. assessed by the Corporate Management Team, and considered by the Council of Oxfam operates a comprehensive three-year Trustees. Additionally, the Corporate planning and budgeting system with an Management Team continues to assess annual budget approved by the Council of the risks that Oxfam faces regularly Trustees. The budget is explicitly linked to during the year. the current Strategic Plan. Any significant changes to those plans are subject to The Internal Audit department aims to Trustees’ approval. Revised forecasts are carry out a programme of regular cyclical undertaken during the course of the year. audits, but has been constrained by There is a financial reporting system that resource availability. Additional resource compares results to the budget on a has been allocated to Internal Audit to monthly basis. reduce the risks associated with a prolonged audit cycle. The reviews undertaken are prioritised using a risk- Auditors based approach. The Head of Internal During the year Oxfam conducted a Audit submits regular reports to the tendering process to review the provision Trustee Audit and Finance Group (TAFG), of audit services to Oxfam. A resolution ensuring that the controls are reviewed for the appointment of on an ongoing basis by staff and skilled PricewaterhouseCoopers as auditors volunteers acting on behalf of the Trustees. of the charity will be proposed at the TAFG monitors the implementation of high Annual General Meeting. 22


  • Page 23

    TRUSTEES’ REPORT: ORGANISATION AND CORPORATE GOVERNANCE 5. ORGANISATION AND CORPORATE GOVERNANCE Organisation criteria and the needs created by retirements. Trustee appointments are Oxfam is a registered charity, (registration based on the need for Council as a whole number 202918) and is constituted as to have the skills and experience to a company registered in England and determine the policies of Oxfam and limited by guarantee (registration number to monitor the implementation of 612172). Its objects and powers are set those policies. out in its Memorandum and Articles of Association. Oxfam is managed by a Corporate The directors of the company are the Management Team who report to the charity’s Trustees, and they are known as Council of Trustees. The members of Oxfam’s Council. This Council, by which the Corporate Management Team, Oxfam is governed, comprises a minimum whose names are listed on page 2, of ten and a maximum of twelve Trustees. are not directors for the purposes of The Trustees retire after a maximum of company law. six years’ service, extendible up to a maximum of nine years in the case of The Trustee Audit and Finance Group the Chair, Vice-Chair, and Treasurer. (TAFG) meets regularly with the external auditors, both with and without the presence of management, agrees the scope Corporate governance of the external audit, reviews the external The members of the company are auditor’s management letter, and monitors known as the Association. This Association implementation of actions required as a is comprised of all the Trustees plus a result. TAFG also has the responsibility of number of other members up to a ensuring that the audit, risk management, maximum membership of 32. Members and control processes within Oxfam are are appointed by the Council, and ratified effective. It is chaired by the Treasurer, and by the Association. New Trustees are oversees the work programme of Internal appointed by the Association on the Audit and the control implications of recommendation of Council (the Council Internal Audit reports. being the governing body of Oxfam). Members of the Association have One further committee that carries out guaranteed the liabilities of the company specific functions on behalf of the Council up to £1.00 each. is the Remuneration Committee. This Committee monitors the implementation Applications and nominations for of Oxfam’s rewards policy (i.e. the trusteeship and for membership of the remuneration and benefits for Oxfam Association may be submitted by anyone staff). It also specifically determines involved with Oxfam to a group of Trustees Oxfam’s policy on the remuneration and and other Association members known as benefits for the Corporate Management the Recruitment and Development Group. Team. The Remuneration Committee This group considers applications and comprises four Trustees and is chaired nominations in the light of specific by the Chair of Oxfam. 23


  • Page 24

    Trustees are also involved in a number of for each financial year, which give a true other Oxfam committees, working groups, and fair view of the state of affairs and areas in which a duty cannot legally be the results of the charity and the group for delegated, and areas where there are that period. In preparing those accounts, specific issues concerning Oxfam’s the Trustees are required to select suitable reputation. Committees include the accounting policies and then apply them Pension Committee and the Oxfam consistently; make judgements and Activities Limited Board, both of which estimates that are reasonable and prudent; have at least one Trustee member. The state whether applicable accounting main working group in 2001/02 was the standards have been followed, subject to Trustee Impact Group; this group monitors any material departures disclosed and progress on the measurement of impact in explained in the accounts; and prepare the international programme and is the accounts on the going-concern basis, scheduled to continue its work during the unless it is inappropriate to presume that coming financial year. Three specified the charity will continue to operate. Trustees are authorised to act as signatories to disposals of Oxfam property The Trustees are responsible for ensuring (since two Trustee signatures are required that proper accounting records are kept under the Charities Act 1993) and two which disclose, with reasonable accuracy specified Trustees are involved in the at any time, the financial position of the occasional authorisation of grants which charity, and enable them to ensure that fall outside standard policy guidelines the accounts comply with the Companies and/or involve sensitive issues. Act 1985. They are also responsible for safeguarding the assets of the charity and In order to be accountable both to hence for taking reasonable steps for the supporters and to the people we work with prevention and detection of fraud and all over the world, Oxfam undertakes two other irregularities. key initiatives. An Assembly, of about 200 participants, is held periodically for In preparing these accounts, Trustees volunteers, staff, and Oxfam’s overseas have sought to follow best practice in partners to discuss issues and share accounting by charities, as laid down in information. A regular ‘Stakeholder Survey’ the Statement of Recommended Practice gathers views on Oxfam’s work and impact (SORP) “Accounting and Reporting by from a broad spectrum of people and helps Charities”, other current statutory determine future strategy. Copies of the requirements, and the requirements most recent ‘Stakeholder Survey’ are of Oxfam’s Memorandum and Articles. available from www.oxfam.org.uk/survey. Any departures and reasons for departures from the SORP are disclosed in the relevant notes to the accounts. Trustees and their statutory responsibilities Oxfam’s Memorandum and Articles of The names of the Trustees who have acted Association give the Trustees wide-ranging during the year are given on page 2. powers of investment, including Company Law requires the Trustees to be investment in stock, shares, and responsible for the preparation of accounts debentures in any part of the world. 24


  • Page 25

    TRUSTEES’ REPORT: ORGANISATION AND CORPORATE GOVERNANCE Oxfam investments are held in accordance disabled people. In line with Oxfam’s with these powers. Equal Opportunities policy and the Disability Discrimination Act, every reasonable measure is taken to adapt the Staff and volunteers site and working conditions to enable appointment. Oxfam’s policy on training, The Trustees wish to record their career development, and promotion of appreciation to all staff and volunteers disabled people is, as far as possible, for their devoted work, often beyond the identical to that for other employees. call of duty. Without this commitment If employees become disabled, every effort the work of Oxfam could not continue. is made to ensure their continued employment and, where possible, the site Consultation and working conditions are adapted. Oxfam has well-established arrangements for consulting and involving staff in Volunteers its work. Management and staff bodies Nearly 23,000 volunteers work in Oxfam negotiate terms and conditions of shops and thousands of others contribute employment through the Staff Associations their time to Oxfam in other ways. Most in countries outside Britain and through make a regular commitment, ranging from the Oxfam Negotiating Committee in a few hours to a full working week. Some Britain. All managers are expected to hold use their professional expertise and others regular meetings with their staff to provide give their time and energy in work that is an opportunity for communication of not related to their everyday jobs. Some information and discussion of events as volunteers may be retired, or not in paid they develop. employment. Oxfam tries to apply the principles of involvement and equality To keep staff and volunteers informed, to its many volunteers. Everyone who works Oxfam produces a fortnightly newsletter with Oxfam is encouraged to feel part of a called VOX, maintains an intranet site, world-wide movement of people who are and holds regular staff forums throughout working together to overcome poverty the UK. and suffering. Equal Opportunities Equal opportunities in employment within Oxfam is seen as an integral part of Oxfam’s overall aims and objectives. The aim of the Equal Opportunities policy is to ensure that all people receive equality Rosemary Thorp of opportunity within Oxfam. This policy affects staff and volunteers alike. Chair of Oxfam 30 September 2002 Disabled employees Oxfam gives full and fair consideration to applications for employment from 25


  • Page 26

    INDEPENDENT AUDITORS’ REPORT To the Members of the Association of Oxfam GB We have audited the financial statements of Oxfam GB for the year ended 30 April 2002, which comprise of the Statement of Financial Activities, the Balance Sheet, and the related notes. These financial statements have been prepared under the historical cost convention as modified by the revaluation of certain fixed assets and the accounting policies set out therein. Respective responsibilities of directors and auditors As described in the Statement of Directors’ Responsibilities, the trustees, who are also the directors of Oxfam GB for the purposes of company law, are responsible for the preparation of financial statements in accordance with applicable law and United Kingdom Accounting Standards. Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and United Kingdom Auditing Standards. We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in acccordance with the Companies Act 1985. We also report to you if, in our opinion, the Trustees’ Report is not consistent with the financial statements, if the company has not kept proper accounting records, if we have not received all the information and explanations we require for our audit, or if information specified by law regarding directors’ remuneration and transactions with the company is not disclosed. We read the Trustees’ Report and consider the implications for our report if we become aware of any apparent mis-statements within it. Basis of Opinion We conducted our audit in accordance with United Kingdom Auditing Standards issued by the Auditing 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 judgements made by the directors in the preparation of the financial statements, and of whether the accounting policies are appropriate to the charitable company’s circumstances, consistently applied, and adequately disclosed. 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 as to whether the financial statements are free from material mis-statement, 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. 26


  • Page 27

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 Opinion In our opinion the financial statements give a true and fair view of the charitable company’s state of affairs as at 30 April 2002 and of the group’s incoming resources and application of resources, including its income and expenditure, in the year then ended, and have been properly prepared in accordance with the Companies Act 1985. Oxford 30 September 2002 Critchleys Chartered Accountants Registered Auditors 27


  • Page 28

    CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES Unrestricted Unrestricted Restricted Totals Totals Trading Funds Funds Activities 2002 2001 NOTES £’000 £’000 £’000 £’000 £’000 Incoming resources 2a Donations, legacies & similar incoming resources - 61,744 12,974 74,718 68,940 Activities in furtherance of the charity’s objects: 2b Resources from government & other public authorities - - 46,265 46,265 54,499 Activities for generating funds: 2c Trading sales 65,145 - - 65,145 61,575 2d Investment income & other incoming resources - 3,119 151 3,270 2,322 2e Total incoming resources 65,145 64,863 59,390 189,398 187,336 Less: Cost of generating funds 2c Trading costs 54,591 - - 54,591 55,491 2f Fundraising costs - 19,834 38 19,872 14,955 Net incoming resources 10,554 45,029 59,352 114,935 116,890 2c Transfer of profit on trading activities (10,554) 10,554 - - - Net incoming resources available for charitable application - 55,583 59,352 114,935 116,890 Charitable expenditure 3b,3d Grants payable in furtherance of the charity's objects 11,439 3,870 15,309 16,129 3c,3d Costs of activities in furtherance of the charity's objects 13,944 36,655 50,599 67,518 2a,2b Gifts in kind 46 15,966 16,012 18,291 3e Support costs 25,884 1,370 27,254 21,763 3f Managing & administering the charity 3,031 - 3,031 1,979 3a Total charitable expenditure 54,344 57,861 112,205 125,680 Total resources expended 128,769 57,899 186,668 196,126 Net incoming/(outgoing) resources before revaluations 1,239 1,491 2,730 (8,790) & investment asset disposals Gain on investments: Included in restricted 10 Unrealised 11 – 11 111 funds carried forward is Realised 81 – 81 2 £1,636,000 (2000/01 Net movement in funds 1,331 1,491 2,822 (8,677) £1,636,000) endowment Total funds brought forward as funds. The detailed previously stated 36,590 14,976 51,566 68,601 analysis of endowment Prior year adjustment – – – (8,358) funds and restricted funds is provided in Total funds brought forward restated 36,590 14,976 51,566 60,243 notes 18 and 19 respectively. Total funds carried forward 37,921 16,467 54,388 51,566 28


  • Page 29

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 SUMMARY INCOME AND EXPENDITURE ACCOUNT (SEE NOTE 7) Oxfam Group 2002 2001 NOTES £’000 £’000 Income 2a Donations, legacies & similar incoming resources 74,718 68,925 This income and 2b Resources from Government and other public authorities 46,265 54,499 expenditure account 2c Trading sales 65,145 61,575 is included in the 2d Investment income and other incoming resources 3,270 2,322 accounts in compliance Realised gains on disposal of investments 81 2 with the Companies Total realised income 189,479 187,323 Act 1985. It excludes receipts on Endowment Less: funds and unrealised 2c Trading costs (54,591) (55,491) gains on investments, 2f Fundraising costs (19,872) (14,955) in accordance with 2a Charitable expenditure (112,205) (125,680) the Statement of Recommended Practice, 8 Surplus/(deficit) of income over expenditure 2,811 (8,803) “Accounting and Transfers (to)/from other funds: Reporting by Charities”. All activities are 19 Transfer (to)/from Restricted funds (1,491) 8,216 continuing. As a 20 Transfer from Designated fund – Other 2,354 1,493 company limited by Transfer (to)/from Designated fund – Fixed assets 1,359 651 guarantee, and with 18 Transfer from Endowment fund 0 1 charitable objects, a “reconciliation of 20 General Reserves at 30 April 2001 16,719 15,161 shareholders’ funds” 20 General Reserves at 30 April 2002 21,752 16,719 is not considered appropriate. 29


  • Page 30

    BALANCE SHEET Oxfam Oxfam Group 2002 2001 2002 2001 NOTES £’000 £’000 £’000 £’000 Fixed Assets 9 Tangible Assets 15,461 16,596 15,661 16,866 10 Investments 4,212 4,359 1,775 1,922 19,673 20,955 17,436 18,788 Current Assets 11 Stocks 2,468 4,186 2,844 5,298 12 Debtors 11,352 21,244 11,881 21,786 13 Cash at Bank and in hand 36,650 22,663 36,712 22,679 50,470 48,093 51,437 49,763 14 Creditors: amounts falling due within one year (15,755) (17,144) (14,445) (16,920) Net current assets 34,715 30,949 36,992 32,843 Total Assets less current liabilities 54,388 51,904 54,428 51,631 15 Creditors: amounts falling due after one year 0 0 (40) (65) Net Assets 54,388 51,904 54,388 51,566 Charitable Funds 18 Endowment funds 1,636 1,636 1,636 1,636 19 Restricted funds 14,831 13,340 14,831 13,340 20 Designated fund – Fixed assets 15,778 17,126 15,778 17,126 20 Designated fund – Other 391 2,745 391 2,745 20 General reserves 21,752 17,057 21,752 16,719 54,388 51,904 54,388 51,566 Approved by the Council of Trustees: Rosemary Thorp (Chair of Oxfam) 30 September 2002 30


  • Page 31

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 CONSOLIDATED CASH FLOW STATEMENT (SEE NOTE 24) 2002 2002 2001 2001 £’000 £’000 £’000 £’000 Net cash inflow/(outflow) from operating activities 17,418 (10,646) Returns on investments and servicing of finance Deposit interest received 989 1,156 Investment income (on endowment investments) 63 6 Finance lease interest paid (15) (19) 1,037 1,143 Capital Expenditure and Financial Investment Payments to acquire tangible fixed assets – additions (3,169) (3,112) Payments to acquire tangible fixed assets – on finance leases (53) 0 Receipts from sales of tangible fixed assets 742 479 Acquisition of fixed asset investments (1) (19) Disposal of fixed asset investments 240 141 Net increase in endowment investments 0 14 (2,241) (2,497) Net Cash inflow/(outflow) before management of liquid resources and financing 16,214 (12,000) Management of liquid resources (Increase)/decrease in short term deposits (10,000) 13,000 Financing Capital element of finance leases (75) (92) Release of endowments to revenue funds 0 (1) Additions to endowments 0 15 Net (increase) in endowment investments 0 (14) (75) (92) Increase in cash in the year 6,139 908 31


  • Page 32

    1. ACCOUNTING POLICIES a. Accounting conventions of cafédirect limited, in which Oxfam Activities Limited has a 25 per cent The accounts are prepared under the holding, have not been included historical cost convention, as modified by as the amounts involved are not the inclusion of investments at market considered material. value, and in compliance with the Statement of Recommended Practice The accounts of Oxfam’s trading (SORP) “Accounting and Reporting by subsidiary company, Living on the Line Charities” and applicable accounting Limited, are consolidated with the standards. accounts of Oxfam. As a large and complex charity, Oxfam The accounts of Oxfam (India) Trust are seeks to provide certain ancillary services included within the accounts of Oxfam. in-house, such as printing, design, Oxfam (India) Trust was set up as a warehousing, and support of information UK charity in 1978, in order to take systems and technology. These services are responsibility for the funds which Oxfam recharged to user departments on the remits to India in the course of its ongoing basis of units of output, rather than by development and relief programme, and apportioning costs, such as salaries and to comply with the India Foreign depreciation, to supported functions as Contributions Regulation Act 1976. appearing in the Statement of Financial Activities. c. Incoming resources The charity has had to adjust the formats Income is recognised in the period in from those prescribed by the 1985 which Oxfam is entitled to receipt and Companies Act, to include headings which where the amount can be measured with are relevant to its activities, to enable it to reasonable certainty. show a true and fair view. Income from ‘Gift Aid’ tax reclaims is Certain minor adjustments have been recognised for any ‘Gift Aid’ certificates made to comparatives in the primary received up to a month after the year-end, statements to ensure consistency with the in relation to donations made prior to the 2001/02 position. year-end. b. Basis of consolidation Income is deferred when Oxfam has to The accounts of Oxfam’s trading fulfil specific contract conditions prior to subsidiary company, Oxfam Activities entitlement to it or where the donor has Limited, are consolidated with the specified that the income is to be accounts of Oxfam. The taxable profit of expended in a future period. Oxfam Activities Limited is donated to Oxfam by ‘Gift Aid’ so that there is no Grants from governments and other liability to corporation tax. The accounts agencies have been included as income 32


  • Page 33

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 from ‘activities in furtherance of the Managing and administering the charity charity’s objects’ where these amount to expenditure represents the salaries, a contract for services, but as donations direct expenditure, and overhead costs where the money is given in response incurred by Finance, Human Resources, to an appeal or where greater freedom and Internal Audit departments, and of use exists. the Directorate, attributable to the management of the charity’s assets, d. Costs of generating funds organisational administration, and compliance with constitutional and Costs of generating funds comprise the statutory requirements. costs incurred in commercial trading activities and fundraising. Fundraising costs include the costs of advertising, f. Gifts in kind producing publications, printing and Blankets and clothing, etc. received and mailing fundraising material, staff costs given to overseas projects are included in in these areas, and an appropriate the accounts at market value at the time allocation of central overhead costs. of export. Goods held pending dispatch are not included in the accounts. Goods e. Charitable expenditure which have been dispatched overseas but are not yet distributed from Oxfam- Grants payable in furtherance of the controlled stores are included in the value charity's objects are recognised as of aid provided and are not included on expenditure at the time of approval. the Balance Sheet. This is taken to be the The value of grants approved, but still point at which the goods have a value to to be paid are included in the Balance the beneficiary. Sheet as current liabilities. Food aid, for which Oxfam accepts full Costs of activities in furtherance of the responsibility for distribution, is included charity's objects are accounted for as they in ‘Resources from government and other are incurred. Any unrestricted expenditure public authorities’ at its market value, that has been approved, but remains and under ‘Charitable expenditure’ at unspent at the year end, is provided for the same value. under designated funds. Properties, investments, and other fixed Support costs represent the costs of assets donated to the charity are included Oxfam’s core field offices and the costs as donation income at market value at the incurred by GB-based staff who are time of receipt. directly providing support for Oxfam’s international programme. It includes management, policy and advocacy g. Tangible fixed assets and work, supervision and technical support depreciation for Oxfam’s emergency programmes, Tangible fixed assets costing more than and the running costs of the Oxfam £1,000 are capitalised and included at cost, logistics warehouse, purchasing, and including any incidental expenses logistics operations. of acquisition. 33


  • Page 34

    Depreciation is provided on all tangible i. Stocks fixed assets at rates calculated to write-off Bought-in stocks are valued at whichever the cost by equal annual instalments is the lower of cost or net realisable value, over their expected useful economic lives after making due allowance for any as follows: obsolete or slow-moving items. Unsold Freehold land Nil donated items are not included in closing Freehold buildings 50 years stock since their cost is nil and their value Leasehold warehouse 10 years is uncertain until sold. Computer infrastructure 10 years j. Foreign currencies Leasehold premises 5 years Transactions in foreign currencies, Furniture, fixtures, and equipment in GB 5 years including capital transactions, during the year are translated at the rate prevailing Computer equipment 3 years at the time of the transaction. Foreign Motor vehicles 4 years currency balances are translated at the Furniture, fixtures, and rate of exchange prevailing at the Balance equipment overseas 3 years Sheet date. Vehicles and equipment used in operational programmes overseas are not k. Pension scheme capitalised but are charged in full to Oxfam operates a pension scheme charitable expenditure when purchased. providing benefits based on final This reflects the significantly different pensionable pay. The assets of the circumstances in such programmes. scheme are held separately from those of the charity and are managed by h. Fixed asset investments The Pensions Trust. The expected cost Fixed asset investments include freehold of providing pensions, as calculated properties where it is unlikely that Oxfam periodically by professionally qualified will be able to realise its investment in actuaries, is charged to the Statement of the foreseeable future. Included in this Financial Activities. The charge spreads are properties where the proceeds, once the cost of pensions over employees’ realised, will be used for charitable working lives with Oxfam, in such a purposes, rather than reinvestment. way that the pension cost is a These fall within the definition of current substantially level percentage of current asset investments given in the SORP and expected future pensionable “Accounting and Reporting by Charities”. payroll costs. However, due to the specific circumstances relating to these properties l. Finance and operating leases the Trustees consider it appropriate to Assets held under finance leases are classify them as fixed asset investments. included in tangible fixed assets and Fixed asset investments are included in depreciated at the appropriate rates. the Balance Sheet at market value where Obligations under such agreements are there is a material difference between cost included in creditors, net of finance and market value. charges allocated to future periods. 34


  • Page 35

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 Rentals payable under operating leases o. Savings and credit schemes are charged to the Statement of Financial Oxfam provides funds under savings and Activities as incurred over the term of micro credit schemes either direct to the lease. individual members of local communities or via local community groups. Oxfam m. Other commitments generally retains a responsibility for Provision is not made in the accounts managing these schemes until such time for future liabilities in respect of future as it is possible to transfer the period grant allocations. management responsibility to the local community. The cost of Oxfam’s contributions to these schemes is n. Fund accounting included in charitable expenditure. Restricted, designated, and other unrestricted funds are separately p. Guarantees disclosed, as set out in Notes 19 and 20. In support of Oxfam’s Fair Trade market The different funds held are defined access programme, advances to specific as follows: third parties under ‘Commercial Order Restricted and endowment funds are Export Credit’ are guaranteed by Oxfam. subject to specific restrictions imposed All guarantees are for a maximum of two by the donor or by the nature of the years and a stated maximum liability. appeal. Further details on outstanding guarantees as at 30 April 2002 are given in note 17. Designated funds are set aside at the discretion of the Trustees for specific purposes. They would otherwise form part of the other unrestricted funds. The specific designated funds held are: • Designated fund for fixed assets, which represents resources invested in the charity’s fixed assets. The fund is therefore not readily available for other purposes. • Other designated funds that are set aside by Trustees to cover operational programmes (not funded by restricted income) where grants have been allocated during the year, but not paid out by the year-end. 35


  • Page 36

    2. INCOME a. Donations, legacies, and similar incoming resources 2002 2002 2002 2001 As explained in Accounting £’000 £’000 £’000 £’000 Policies Note 1, income is Unrestricted Restricted Total Total accounted for as soon as it is prudent and practicable to Committed Giving 45,224 0 45,224 39,765 do so, that is once there is Legacies 9,776 189 9,965 9,246 reasonable certainty as to the amount and Public donations, appeals, & fundraising events 6,698 5,102 11,800 11,293 entitlement. Gifts in Kind – blankets & clothing 46 0 46 82 Disasters Emergency Committee (DEC) appeals 0 1,173 1,173 2,981 At 30 April 2002, in addition to legacy income that has UK government – Department for International been included in the Development (Partnership Programme Agreement) 0 6,510 6,510 5,573 accounts on the above basis, 61,744 12,974 74,718 68,940 Oxfam expected to benefit from a number of legacies from estates for which the administration had yet to be finalised. Oxfam’s future There was one Disasters Emergency Committee appeal during the year for the volcano eruption in Goma, Democratic income from these legacies Republic of Congo. Oxfam chose to receive £0.1 million from this appeal and a further £1.1 million from previous years’ is estimated at £1.3 million Gujarat and Kosovo appeals. This compared with £3.0 million received in 2000/01. (2001: £0.8 million). b. Resources for specific programmes from governments and other public authorities 2002 2001 £’000 £’000 UK government – Department for International Development 6,276 10,887 European Union 10,373 10,182 UNHCR 1,316 2,323 Other UN agencies 2,088 1,243 Members of Oxfam International (Note 23) 6,699 9,583 Non-UK governments 1,576 533 Other international agencies 1,334 1,015 Community Fund 618 427 Other UK agencies 19 97 Gifts in Kind – vehicles, medical supplies, and seeds 100 57 Oxfam acknowledges Gifts in Kind – Food Aid received from UNICEF 25 0 funding from the Community Fund for the Gifts in Kind – Food Aid received from World Food Programme 15,841 15,915 GB Poverty Programme (£311,000), AIDS intervention Gifts in Kind – Food Aid received from European Union 0 2,237 in India (£175,000) and 46,265 54,499 education in Mozambique (£132,000). 36


  • Page 37

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 c. Activities for generating funds: Trading income 2002 2002 2002 2001 2001 2001 Oxfam OAL Total Oxfam OAL Total £’000 £’000 £’000 £’000 £’000 £’000 Turnover from donated goods 49,096 3,725 52,821 46,217 3,348 49,565 Turnover from purchased goods 6,782 5,542 12,324 448 11,562 12,010 Total trading sales 55,878 9,267 65,145 46,665 14,910 61,575 Operating expenses (42,819) (6,680) (49,499) (36,256) (9,593) (45,849) Management expenses (4,195) (897) (5,092) (4,420) (5,222) (9,642) Total trading expenses 47,014 7,577 54,591 (40,676) (14,815) (55,491) Net trading income 8,864 1,690 10,554 5,989 95 6,084 In addition, the following amounts, included within donations, were collected through the shops: Unrestricted donations 678 0 678 971 0 971 Restricted donations 828 0 828 1,313 28 1,341 Net income including donations 10,370 1,690 12,060 8,273 123 8,396 Oxfam’s wholly owned subsidiary, Oxfam Activities Limited (OAL), raises funds by means of trading activities. Trading income represents income from the sale of donated and bought-in goods through the charity’s shops, recycling operations, and licensing income. Turnover from donated goods includes rental income from sublet units of Oxfam shops of £0.6 million (2000/01: £0.6 million). No charge is made to the trading subsidiary for rags provided from Oxfam shops. Interest on working capital of £0.2 million (2000/01: £0.4 million) was charged to the trading subsidiary by Oxfam, resulting in a £1.2 million profit for Oxfam Activities Limited (2000/01: break even). By reporting the turnover and results of its subsidiaries separately, Oxfam is taking advantage of the concession, given by paragraph 304 of the Charities SORP October 2000, not to prepare separate consolidated and charity Statement of Financial Activities. (No material contribution was made to the group turnover or net results in the year by Living on the Line Limited.) For further details of Oxfam’s subsidiaries see Note 10. 37


  • Page 38

    d. Investment income and other incoming resources 2002 2001 £’000 £’000 Deposit Interest – unrestricted 1,041 1,006 Deposit Interest – restricted 150 150 Sale of printed material 982 473 Surplus on Disposal of Fixed Assets 8 7 Investment Income Cash held for investment (interest on endowments) 63 6 Nursery fees 174 156 Sale of humanitarian equipment 685 372 Miscellaneous overseas income 83 118 Others 84 34 3,270 2,322 e. Total unrestricted incoming resources Total unrestricted incoming resources for the year amounted to £130.0 million (2000/01 £119.8 million). f. Fundraising costs Fundraising costs represent costs to raise both restricted and unrestricted income, excluding trading sales. This is analysed as follows: 2002 2001 £’000 £’000 Staff costs 4,328 3,358 Irrecoverable VAT 1,246 743 Other costs 14,298 10,854 19,872 14,955 38


  • Page 39

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 3. CHARITABLE EXPENDITURE a. Charitable expenditure – functional analysis Oxfam’s relief and development programme can be analysed as follows: 2002 2001 £’000 £’000 Food and income security 15,152 16,684 Employment 1,177 2,156 Health care 6,399 13,215 Education 3,678 5,717 Saving and protecting lives 17,671 11,701 Conflict reduction 2,501 8,248 Right to be heard 7,135 11,528 Right to equity 3,898 6,186 Information, campaigning, and education 8,297 7,748 Gifts in Kind 16,012 18,291 Support costs 27,254 21,763 Managing and administering the charity 3,031 1,979 Other – 464 Total 112,205 125,680 Gifts in Kind is primarily the distribution of food aid and would be included in “saving and protecting lives”. It is separately analysed due to its significance. Many programmes achieve aims in more than one of the above categories. This analysis provides a guide to Oxfam’s programme expenditure by aim. b. Grants payable in furtherance of the charity’s objects Much of Oxfam’s development programme is carried out through grants to local organisations that support long-term, sustainable benefits for a community. Grants are also made to fund immediate emergency relief provision in times of crisis, catastrophe, or natural disaster. Details of the largest fifty grants made by Oxfam to institutions are listed at Note 23. c. Costs of activities in furtherance of the charity’s objects Oxfam’s own overseas staff are also involved in delivery of the programme through the provision of specialist services (eg to address the water and sanitation needs of refugees) and also through training and networking for local organisations. Charitable expenditure on “costs of activities in furtherance of the charity’s objects” amounted to £50.6 million (2000/01 £67.5 million). This decrease reflects the reduction in the scale of restricted operational programmes funded by institutional donors. 39


  • Page 40

    d. Information, campaigning, and education Oxfam’s information, campaigning, and education programme has several key objectives in furtherance of Oxfam’s purposes. One is to inform the British public about our international experience of work with poor people. We carry out research and analysis of the issues raised by our work, as a contribution to public debate and policy-making in Britain and the European Union, in the interests of alleviating poverty and suffering worldwide. Another is to campaign for changes for the benefit of poor people. And a third is to contribute our experience, that comes from the international programme to the curricula and methods of school teaching and youth work in Great Britain. e. Support costs Support costs represent the cost of Oxfam’s core field offices and the costs incurred by GB-based staff, directly providing support for Oxfam’s international programme. It includes management, policy and advocacy work, supervision and technical support for Oxfam’s emergency programmes, and the running costs of the Oxfam emergency warehouse and logistics operations. This expenditure may be analysed as follows: 2002 2001 £’000 £’000 Staff costs 17,283 13,833 Other costs 9,971 7,930 27,254 21,763 f. Managing and administering the charity Management and administration expenditure represents costs incurred by Finance, Human Resources, and Internal Audit departments, and the Directorate, attributable to the management of the charity’s assets, organisational administration, and compliance with constitutional and statutory requirements. This is analysed as follows: 2002 2001 £’000 £’000 Staff costs 1,562 1,109 Pension charge 305 (234) Other costs 1,164 1,104 3,031 1,979 40


  • Page 41

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 4. EMPLOYEES The average full-time equivalent (FTE) and head count number of employees throughout the year was: GB contracted employees 2002 2002 2001 FTE Head count Head count Trading Division 772 1,002 1,119 Marketing Division 319 344 360 The average number Corporate Functions 137 151 135 of employees based Programme Headquarters 258 274 247 overseas on local Programme Field (based overseas) 71 71 66 contracts is only 1,552 1,842 1,927 expressed in terms of head count since an Staff based overseas on local contracts 2,067 2,254 average full-time equivalent is not 3,909 4,181 available. Oxfam operates employment policies that encourage a range of working patterns including job sharing and part-time working. These result in a significantly lower number of employees when based on full-time equivalents rather than on head count. 5. GB CONTRACTED STAFF COSTS 2002 2001 £’000 £’000 Salaries and wages 35,308 32,810 National Insurance 2,533 2,743 Pension scheme 2,231 1,468 40,072 37,021 Staff costs are allocated according to the functions of each staff member and, therefore, form part of trading costs, fundraising costs, and charitable expenditure, as appropriate. Salaries and wages includes the cost of redundancies arising from changes following reviews of some of Oxfam’s operations. The increase in salaries and wages is greater than the rate of inflation, principally because of the need to recruit and retain staff of the appropriate quality. In addition, a great amount of time, the value of which is impossible to reflect in these accounts, is donated by tens of thousands of volunteers throughout Britain. 41


  • Page 42

    The number of higher paid staff with emoluments falling in the following ranges were: 2002 2001 £50,000 to £59,999 3 3 £60,000 to £69,999 4 3 £70.000 to £79,999 1 0 £80,000 to £89,999 0 1 Emoluments include salary and taxable benefits in kind. Retirement benefits are accruing under defined benefit schemes for six (2000/01: five) higher paid employees. In addition, Oxfam paid £6,000 (2000/01: £6,000) into a defined contribution pension scheme for one (2000/01: one) higher paid employee. 6. TRUSTEES’ EXPENSES Members of Oxfam’s Council of Trustees receive no remuneration for their services. Directly incurred expenses of the Trustees borne by the charity in 2001/02 totalled £24,000 (2000/01: £23,000) paid to seven Trustees. Included in Trustees expenses are the costs of visits by Trustees to overseas programmes. Some Trustees have made donations to Oxfam to match these costs. This income is included in public donations (note 2a). 7. INCOME AND EXPENDITURE ACCOUNT An income and expenditure account is an alternative summary of the information contained in the Statement of Financial Activities. As recommended in the Charity SORP, this statement excludes gifts of capital which are not currently available for revenue expenditure (see Note 19 on Endowment Funds) and unrealised revaluations of investment assets. The income and expenditure account is included in the accounts in order to comply with the Companies Act 1985. Oxfam uses the exemption conferred by section 230 of the Companies Act 1985 in not preparing a separate Income and Expenditure Account for Oxfam that excludes its wholly owned subsidiaries. 42


  • Page 43

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 8. SURPLUS/(DEFICIT) OF INCOME FOR THE FINANCIAL YEAR STATED AFTER CHARGING/(CREDITING): 2002 2001 £’000 £’000 Finance lease interest 15 19 Depreciation of Tangible Fixed Assets 3,693 3,276 Hire of vehicles and equipment 1,484 1,200 Property rental 15,831 14,766 Auditors’ remuneration – Statutory Audit (GB) 44 40 – Audit (Overseas) 28 15 – Other 4 5 Rental income (564) (632) Exchange rate differences (63) 845 Indemnity insurance 3 8 Income from endowment capital 63 77 Irrecoverable VAT 1,484 770 The reported exchange rate gain was £63,000 (2000/01: loss £845,000). This reported gain consists of two elements; i) The notional accounting gains and losses due to Oxfam using standardised internal exchange rates when transferring funds abroad. Where these standardised rates differ from actual rates, the difference is reported as an exchange gain or loss. This reported gain/loss has no impact on the level of resources available for programmes. ii) The actual exchange gains/losses related to receiving income predominantly in Sterling and Euros and incurring charitable expenditure in currencies related to the US Dollar during a period where the US Dollar has fluctuated. 43


  • Page 44

    9. TANGIBLE FIXED ASSETS Oxfam Furniture Freehold Leasehold Fixtures Motor property property Equipment vehicles Total £’000 £’000 £’000 £’000 £’000 Cost At 1 May 2001 11,179 24,576 16,680 2,281 54,716 Reclassifications 95 (95) (69) 69 0 Additions 0 54 2,851 236 3,141 Disposals (297) (1,006) (3,488) (97) (4,888) At 30 April 2002 10,977 23,529 15,974 2,489 52,969 Depreciation At 1 May 2001 2,602 21,751 11,856 1,911 38,120 Reclassifications 0 (47) 47 0 0 Charge for the year 181 1,074 2,021 266 3,542 Disposals (97) (1,015) (2,855) (187) (4,154) At 30 April 2002 2,686 21,763 11,069 1,990 37,508 Net Book Value At 30 April 2002 8,291 1,766 4,905 499 15,461 At 30 April 2001 8,577 2,825 4,824 370 16,596 Oxfam Group Furniture Freehold Leasehold Fixtures Motor property property Equipment vehicles Total £’000 £’000 £’000 £’000 £’000 Cost At 1 May 2001 11,179 24,705 17,141 2,815 55,840 Reclassifications 95 (95) (69) 69 0 Additions 0 59 2,873 290 3,222 Disposals (297) (1,006) (3,488) (149) (4,940) At 30 April 2002 10,977 23,663 16,457 3,025 54,122 Depreciation At 1 May 2001 2,602 21,823 12,225 2,324 38,974 Reclassifications 0 (47) 47 0 0 The book value of land Charge for the year 181 1,083 2,057 372 3,693 (which is not depreciated) included in freehold Disposals (97) (1,015) (2,855) (239) (4,206) properties is £1.8 million At 30 April 2002 2,686 21,844 11,474 2,457 38,461 (2001: £1.8 million). The net book value of leases Net Book Value over 50 years, grouped with the freeholds, is At 30 April 2002 8,291 1,819 4,983 568 15,661 £0.1 million (2001: At 30 April 2001 8,577 2,882 4,916 491 16,866 £0.1 million). 44


  • Page 45

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 10. FIXED ASSET INVESTMENTS *This includes a loan of £2.5 million to Oxfam Activities Limited, which is incorporated Oxfam Freehold in England and Wales. property Cash Unquoted Total The loan is secured by a £’000 £’000 £’000 £’000 fixed and floating charge. Interest was charged on Market Value: the outstanding balance At 1 May 2001 325 1,532 2,502* 4,359 of the loan at 6 per cent Additions – 1 – 1 during the year. Terms regarding interest are Disposals (154) (5) – (159) agreed between the Revaluations 11 – – 11 parties, and repayment is due in three equal At 30 April 2002 182 1,528 2,502 4,212 annual instalments following the issue of a repayment notice. Oxfam Group Freehold property Cash Unquoted Total **This comprises £’000 £’000 £’000 £’000 32,500 ordinary shares Market Value: at £1 each and 32,500 redeemable preference At 1 May 2001 325 1,532 65** 1,922 shares of £1 each in Additions – 1 – 1 cafédirect limited, a Disposals (154) (5) – (159) company registered in Scotland, which represent Revaluations 11 – – 11 a 25 per cent interest in At 30 April 2002 182 1,528 65 1,775 the company. The principal activity of the company is the promotion of Fair Trade Investment properties have been valued by surveyors, all of whom are Associates of the through the marketing Royal Institute of Chartered Surveyors and are employees of Oxfam. The valuation of the and distribution of assets was on an open market value basis, in accordance with the guidelines issued by coffee and tea. As at 30 September 2001, the Royal Institute of Chartered Surveyors. cafédirect limited had shareholders’ funds of At 30 April 2002, Oxfam had an interest in the following subsidiary and associate £1,273,831. For the undertakings, all of which are registered in Great Britain. 18-month period ending 30 September 2001 the retained profit Class of Portion held Portion held by was £356,247. Organisation share capital by parent other group Nature of name held company companies business All the fixed asset investments are held Oxfam Activities Ordinary 100% – Raises funds through in the UK. Freehold Limited trading activities investment properties cafédirect limited Ordinary – 25% Promotes Fair Trade with an original cost of £85,000 are included cafédirect limited Preference – 25% Promotes Fair Trade in the Balance Sheet at market value where there Living on the Line Ordinary 100% – Dormant is a material difference Limited between cost and market value. All other investments are stated In addition to the subsidiaries shown above, the income and expenditure of Oxfam at cost. (India) Trust is included within the accounts of Oxfam. The share capital of Oxfam Activities Limited, 2,000 ordinary shares of £1 each, is wholly owned by Oxfam and its nominee. The share capital of Living on the Line Limited, two ordinary shares of £1 each, is wholly owned by Oxfam and its nominee. 45


  • Page 46

    11. STOCKS Oxfam Oxfam Group 2002 2001 2002 2001 £’000 £’000 £’000 £’000 Oxfam Trading stocks 693 2,051 1,069 3,163 Emergency stocks 1,572 1,799 1,572 1,799 Other stocks 203 336 203 336 2,468 4,186 2,844 5,298 12. DEBTORS Oxfam Oxfam Group 2002 2001 2002 2001 £’000 £’000 £’000 £’000 Amounts due from institutional donors 1,634 2,748 1,634 2,748 Other debtors 4,884 12,593 5,328 13,012 Prepayments 4,834 5,903 4,919 6,026 11,352 21,244 11,881 21,786 13. CASH AT BANK AND IN HAND Oxfam Oxfam Group 2002 2001 2002 2001 £’000 £’000 £’000 £’000 Cash on short term deposit* 29,501 15,345 29,501 15,345 * This money is held on Cash and bank balances 7,149 7,318 7,211 7,334 interest-earning deposit to be readily available to 36,650 22,663 36,712 22,679 meet current liabilities. 46


  • Page 47

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 14. CREDITORS – AMOUNTS FALLING DUE WITHIN ONE YEAR Oxfam Oxfam Group 2002 2001 2002 2001 £’000 £’000 £’000 £’000 Bank overdraft* 701 2,756 767 2,926 Obligations under finance leases 0 0 59 56 Grants to partners (Unrestricted) 234 1,408 234 1,408 Grants to partners (Restricted) 865 2,368 865 2,368 Amount due to Subsidiaries 1,927 722 0 0 Trade creditors 3,409 3,166 3,616 3,416 *Overdrafts arise on Accruals 7,692 5,679 7,945 5,697 certain accounts as a Other tax and social security 713 800 744 804 result of Oxfam’s Interest-free loans 214 245 214 245 banking arrangements. For interest purposes, 15,755 17,144 14,445 16,920 these are offset against Oxfam’s cash balances. 15. CREDITORS – AMOUNTS FALLING DUE AFTER ONE YEAR Oxfam Oxfam Group 2002 2001 2002 2001 £’000 £’000 £’000 £’000 Obligations under finance leases payable in two to five years 0 0 40 65 16. OBLIGATIONS UNDER FINANCE LEASES AND HIRE PURCHASE CONTRACTS Oxfam Oxfam Group 2002 2001 2002 2001 Amounts payable: £’000 £’000 £’000 £’000 Within one year 0 0 72 75 Between two and five years 0 0 49 72 0 0 121 147 Less finance charges allocated to future periods 0 0 (22) (26) Finance leases and hire purchase liabilities are 0 0 99 121 secured on the assets concerned. 47


  • Page 48

    17. CONTINGENT LIABILITIES Market access guarantees As at 30 April 2002 one “commercial order export credit guarantee” issued in the normal course of business with a maximum potential liability of £24,000, was outstanding. The guarantee will expire on 31 December 2003. 18. ENDOWMENT FUNDS Balance at Income/ Balance at 1 May 2001 Revaluation 30 April 2002 £’000 £’000 £’000 Mary & Henry Makinson Spink Memorial Fund 1,366 0 1,366 Carr-Webb Fund 130 0 130 Other 140 0 140 1,636 0 1,636 The Carr-Webb endowment is represented by a property that was revalued in 2000/01. The value has not changed in 2001/02. The income generated by these funds is used for the unrestricted purposes of Oxfam, except for income generated from £100,000 of the other endowment funds, which is required to be used for restricted purposes. 48


  • Page 49

    OXFAM – ACCOUNTS FOR THE YEAR ENDED 30 APRIL 2002 19. RESTRICTED FUNDS Deficit funds may occur when expenditure is made on a project that is expected Reanalysis to be reimbursed by a and government or other cancellation agency, but where, at the of unspent Restated end of the financial year, Balance at operational balance at Income Expenditure Balance not all the conditions 1 May grant 1 May at 30 April have been met that would 2001 balances 2001 2002 justify this income being £’000 £’000 £’000 £’000 £’000 £’000 recognised within the accounts. This results in an EMERGENCY FUNDS excess of expenditure over income on some project Gujarat (India) earthquake 1,380 547 1,927 36 (984) 979 funds. In the opinion of Afghanistan 0 0 0 1,847 (123) 1,724 the Trustees the likelihood Goma (DRC) volcano 0 0 0 225 (157) 68 of reimbursement is of General catastrophe 312 9,240 9,552 160 (4,616) 5,289 sufficient level to justify the carrying of these deficit funds at the end of the year. CONTRACTS/REGIONAL FUNDS Horn, East, and Central Africa (3,032) 3,892 860 10,584 (9,025) 2,419 The definition of Restricted funds can be found in Southern Africa 3,694 (1,164) 2,530 4,169 (4,546) 2,153 the Accounting Policies, West Africa (1,170) 594 (576) 1,968 (1,133) 259 Note 1 n. East Asia (224) 389 165 2,080 (2,239) 6 As of 1 May 2001 the South Asia (1,338) 363 (975) 6,271 (4,972) 324 practice of charging Middle East, Eastern Europe, committed operational and Commonwealth of expenditure to the funds Independent States (993) 646 (347) 4,742 (3,205) 1,190 and actual expenditure to South America (457) 72 (385) 1,482 (1,019) 78 the unspent operational grant balances ceased. Central America, Mexico, The actual expenditure is and the Caribbean (1,375) 1,727 352 1,614 (1,670) 296 now charged to the funds GB Programme 150 61 211 473 (659) 25 on an accruals basis. This Food Aid 0 0 0 15,966 (15,966) 0 change removes the need Partnership Programme 0 0 0 7,579 (7,579) 0 for a separate unspent Agreement and offset income operational grant balances line and resulted in a (3,053) 16,367 13,314 59,389 (57,893) 14,810 reanalysis of the opening fund balances. In addition, Unspent operational a number of fund balances grant balances 16,367 (16,367) 0 0 0 0 included outstanding Kirkley Education Fund 26 0 26 1 (6) 21 committed expenditure on projects that had been 13,340 0 13,340 59,390 (57,899) 14,831 completed. These commitments were cancelled. 49


  • Page 50

    20. UNRESTRICTED FUNDS Movements on group unrestricted funds are as follows: General Designated Designated reserves fund funds Total fixed assets other £’000 £’000 £’000 £’000 Balance at 1 May 2001 16,719 17,126 2,745 36,590 Surplus for the Year 1,331 1,331 Criteria for the use of these funds can be Transfers between funds 3,702 (1,348) (2,354) 0 found in the Accounting Policies, Note 1 n. Balance at 30 April 2002 21,752 15,778 391 37,921 21. COMMITMENTS a. Capital Oxfam Oxfam Group 2002 2001 2002 2001 £’000 £’000 £’000 £’000 At 30 April 2002 the following capital expenditure had been authorised 79 255 79 255 b. Financial Oxfam Oxfam Group 2002 2001 2002 2001 £’000 £’000 £’000 £’000 At 30 April 2002 Oxfam had committed the following amount in grants to international projects which form part of the grants allocated in the Year ended 30 April 2002 0 2,595 0 2,595 Year ended 30 April 2003 2,895 705 2,895 705 Year ended 30 April 2004 704 67 704 67 Year ended 30 April 2005 205 0 205 0 3,804 3,367 3,804 3,367 50

  • View More

Get the full picture and Receive alerts on lawsuits, news articles, publications and more!