Page 65 - SyI-Annual-Report

Comments

• Work has continued to refine the day to day accounts, correcting previous errors and training new staff. 2019 budget
figures have now been added to SAGE which allows better management and identification of issues to be addressed
• New IT monitors and replacement software has been purchased for the new Marketing & PR Officer and Project
Manager
• The new-look SyI magazine has been introduced, which will require graphic design support and higher printing costs.
This supports the ongoing portrayal of Institutes professionalism, for the benefit of the membership
• Directors expenses remain less than £6,000 per year
• The 2019 Statement of Accounts shows an actual trading deficit of £36,202 in part due to deferring income which
was not reported correctly by our previous accountants resulting in a greater-than usual deficit. Our new chartered
accountants ‘Armstrongs’ have adopted more fiscally sound accounting principles and realigned our reporting.

Recommendations
• The Audit Committee requests notes are added to all financial reporting to provide valuable context
to both quarterly and annual reporting following the realignment of our accountancy procedures
(SAGE) and the transition in accountancy providers
• Quarterly reporting requested 2 weeks prior to Board meetings in order to adequately check and prepare a
presentation
• Fiscal reserves to be built up as a percentage increase against revenue
• HQ SyI/financial audit in 2020 (subject to COVID-19 restrictions)
• In discussions with our Chief Executive/Chairman the Audit Committee will look at the potential risk and mitigation
measures from the FCA compensation scheme for our Bank accounts

Conclusion

Whilst there was a deficit of £36,202.00 at year end against 2019 spending, this is noted against over £104,000
increase in revenue as a result of increasing membership (over 500 now in Group membership scheme). The
deficit in part is due to upfront investment in membership benefits and increased marketing/events
promoting the Security Institute’s growth and realignment in our accountancy following the transfer to our
new chartered accountants ‘Armstrongs’.

Armstrongs have adopted more fiscally sound accounting principles than our previous accountant. In
accordance with Financial Report Standard 102 section 1a, Armstrongs have accounted for deferred income
in the accounts. The principle is to “match” the correct income with the correct expenditure in the correct
period.

In the normal run of things there would be a deferred income figure bought forward from last year.
Unfortunately, our accounts were not prepared on this basis before and all income received in the year has
been recognised as income in that particular year. This is not correct in accordance with Financial Reporting
Standards. The result of deferring income in these accounts for the first-time results in a greater-than-usual
deficit (due to the fact we had not accounted for deferred income bought forward).
However, whilst noting the increased budget deficit the Audit Committee expects this to decrease/fall in line
with budget following the accountancy realignment and additional reserves to be built up as a percentage
increase against revenue. The Institute remains in a strong fiscal position with total assets of £204,401.00. (as
of 31st Dec 2019).

This report is submitted to the Security Institute’s Board of Directors for due consideration and the Audit
Committee stands ready should there be any additional questions.

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