Understanding ANIMAL RESEARCH
ANNUAL REPORT & ACCOUNTS 2009 - 2010 UNDERSTANDING ANIMAL RESEARCH
FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2009
Contents Pages
List of Officers, Council members and Vice Presidents 1
Report of the Council 2 - 3
Statement of the Council's responsibilities 4
Independent auditors' report 5
Income and expenditure account 6
Balance sheet 7
Notes to the financial statements 8 - 11 Understanding Animal Research
President Lord Taverne QC
Chairman Professor Frances Balkwill OBE FMedSci
Honorary Treasurer Mr Paul Sanders
Members of Council Professor Roger Lemon Dr Tony Causey Ms Gill Hilsdon Professor Peter Hollins Mr Alastair Kent Professor Clive Page Dr Mark Tricklebank Dr Ian Viney Dr Philip Wright
Honorary Vice Presidents Sir Colin Berry DSc FRCPath FRCP FFPM FMedSci Professor Colin Blakemore FMedSci FRCP(Hon) FRS Sir Walter Bodmer FRCPath FRS FMedSci Sir Arnold Burgen FRCP FRS FMedSci Sir Roy Calne FRCS FRS Mr Tam Dalyell Sir Colin Dollery FRCP Sir Michael Drury OBE FRCP FRCGP Sir Andrew Huxley OM FRS FMedSci Dr Leslie Iversen FRS Sir David Jack CBE DSc FRS Baroness Knight of Collingtree DBE The Lord Mayhew Sir Stanley Peart FRCP FRS FMedSci Dr Peter Read CBE Professor Nancy Rothwell DBE FRS Sir Richard Sykes DSc FRS FMedSci Lord Turnberg of Cheadle FRCP FMedSci Professor Owen Wade CBE FRCP Lord Walton of Detchant FRCP FMedSci Baroness Warnock of Weeke DBE Sir David Weatherall FRCP FRCPath FRS FMedSci Lord Winston of Hammersmith DSc FRCP FRCOG FMedSci
- 1 - Understanding Animal Research Year ended 31 December 2009 Report of the Council
Vision and mission The vision of Understanding Animal Research (UAR) is to achieve understanding and acceptance of the need for humane animal research in the UK. The mission is to maintain and build informed public support and a favourable policy climate for humane animal research in the UK.
The role of the Council is to ensure good governance of the organisation, and to ensure that its strategy is properly developed and implemented. Members of Council are expected to bring relevant knowledge, experience and expertise to the running of the organisation, and do not sit on Council as representatives of particular organisations.
The detailed work of the organisation is driven forward by three sub-groups that provide advice and strategic direction for policy, communications and education.
UAR uses a range of activities to meet its objectives. It will seek to engage with, inform and educate its target audiences, as well as ultimately to influence when necessary.
Under the existing strategy, Understanding Animal Research focuses on the following as its core audiences:
A. The public B. The media (as a channel to reach the wider public) C. Government, policy-makers and regulators D. School children and teachers E. The entire animal research community, including commercial organisations, funders, learned societies, universities and individual scientists.
Background and creation of UAR A multi-stakeholder review chaired by Simon Denegri was published in summer 2008. This recommended that a new organisation be created out of the existing Research Defence Society (RDS) and Coalition for Medical Progress (CMP).
RDS changed its name to Understanding Animal Research (UAR) following a resolution at its AGM on 5 December 2008. At that AGM a new Council for the organisation was formed, with six members from CMP and six from RDS. This new Council met for the first time on 10 December 2008, immediately after the AGM of CMP.
Subsequently, on 31 December 2008, CMP transferred all its assets and liabilities to UAR, completing the merger. CMP was wound up as a company at the end of 2009.
At the end of 2009 Council committed to undertake a review of the legal status of UAR to determine what is in the best interests of the organisation going forward. This review would be carried out in 2010 and would investigate the possibility of conversion to a limited company or a charity.
A new strategy was developed for UAR following consultations throughout the second half of 2008. This was adopted by the new Council at its first meeting on 11 December 2008.
Council is committed to moving forward the organisation to build on past achievements. This will focus initially on staff development and reward structures. Council also plans to review the organisational strategy during 2010.
- 2 - Activities and finances The major activities of the organisation are to communicate to the public and other audiences, to inform our members on policy development and influence this when necessary, and to run a schools education programme.
2009 was the first full year of activities for the new organization. All of our sub-groups are up-and- running, and providing advice to guide the organization.
The key challenges for 2009 were to:
1. Provide a professional website rich in information and multimedia 2. Develop new publications to reflect the combined perspective of the two organisations 3. Establish ourselves as the lead organisation giving comment on animal research in the UK, particularly to the media 4. Influence the revision of the European Directive EU 86/609 on animal experimentation (mainly through the UK Bioscience Coalition in which UAR takes a lead facilitation role). 5. Develop the school-speaker programme within the new organisation as the most substantial element of the schools education programme
The principal funding source of the organisation in 2009 was subscriptions from member organisations. UAR has over 100 institutional members, most of which pay an annual subscription. These organisations are listed on the website.
The category of “individual subscribing member” was largely phased out during 2009, as part of the governance changes agreed on forming the new organization.
In 2009 the organisation was also in receipt of a grant from Universities UK for running the "Resource Centre" which gave advice to universities and other academic institutions on how to be resilient in the face of animal rights extremism.
The offices of UAR house the organisation “Sense about Science”, which pays a service charge in respect of its occupancy.
In 2009 the Council sought a balanced budget for UAR, and this was achieved.
The accounts for 2009 reveal a significant potential liability, as yet unknown, in respect of a legacy company pension scheme. Once this is resolved, Council will be able to adopt a proactive approach to managing its reserves.
Approved by Council on 24 June 2010
Professor Frances Balkwill OBE FMedSci On behalf of Council
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STATEMENT OF THE COUNCIL'S RESPONSIBILITIES FOR THE YEAR ENDED 31 DECEMBER 2009
The Friendly and Industrial and Provident Societies Act 1968 requires the Council to prepare financial statements for each financial year which give a true and fair view of the state of affairs of Understanding Animal Research ("the Organisation") and of the results of the Organisation for that period. In preparing those financial statements, the Council is required to:
- select suitable accounting policies and then apply them consistently; - make judgements and estimates that are reasonable and prudent. - prepare the financial statements on a going concern basis, unless it is inappropriate to assume that the organisation will continue in operation.
The Council is responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Organisation and to enable it to ensure that the financial statements comply with The Friendly and Industrial and Provident Societies Act 1968. It is also responsible for safeguarding the assets of the Organisation and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS FOR THE YEAR ENDED 31 DECEMBER 2009
We have audited the financial statements on pages 2 to 11 of Understanding Animal Research ("the Organisation") for the year ended 31 December 2009 which comprise the Income and Expenditure Account, the Balance Sheet and the related notes. These financial statements have been prepared under the historical cost convention and the accounting policies set out therein. This report is made solely to the members, as a body, in accordance with The Friendly and Industrial Provident Societies Act 1968. Our audit work has been undertaken so that we might state to the Organisation's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Organisation and the Organisation's members as a body, for our audit work, for this report, or for the opinions we have formed. RESPECTIVE RESPONSIBILITIES OF THE ORGANISATION AND AUDITORS As set out in the Council's Statement of Responsibilities on page 1, the Council is responsible for the preparation of the financial statements in accordance with United Kingdom law and accounting standards. Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland). We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in accordance with the Friendly and Industrial and Provident Society's Act 1968. We also report to you if, in our opinion, the Organisation 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 Council members' remuneration and transactions with the Organisation is not disclosed. BASIS OF AUDIT OPINION We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) 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 significant estimates and judgements made by the Council in the preparation of the financial statements, and of whether the accounting policies are appropriate to the Organisation'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 that the financial statements are free from material misstatement, 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. OPINION In our opinion: - the financial statements give a true and fair view, in accordance with United Kingdom Generally Accepted Accounting Practice, of the state of the Organisation's affairs as at 31 December 2009 and of its income and expenditure for the year then ended and have been properly prepared in accordance with the Friendly and Industrial Provident Societies Act 1968 and the regulations made under it. - the information in the Report of the Council as approved by Council Officers does not conflict with the financial statements for the year.
George Meakin Senior Statutory Auditor Dated: For and on behalf of: HEXTALL MEAKIN Chartered Accountants & Statutory Auditors Argon House, Argon Mews Fulham Broadway London SW6 1BJ - 5 - UNDERSTANDING ANIMAL RESEARCH
INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 2009
2009 2008 NOTES ££ INCOME Subscriptions and donations 692,011 465,143 Universities UK Grant 33,152 73,420 Interest received 7,070 15,057 Sale of publications and services 183 463 Other income 2,622 - Service recharges 7,433 3,631 742,471 557,714 EXPENDITURE Staff salaries and costs 4 456,343 371,910 Premises expenses 106,744 99,085 Stationery, postage and telephone 9,818 8,189 Repairs and maintenance 1,265 149 Sundry expenses 2,277 2,003 Staff and Council expenses 5 14,329 10,251 Communications 31,363 30,701 Printing and design 8,149 25,251 Grants and subscriptions 1,958 1,142 Information technology costs 7,366 4,522 Education costs 7,230 Project and consultancy 4,436 - Recoverable finance officer costs (184) (2,500) Transition costs 39,037 51,298 Audit, accountancy and book keeping fees 11,407 9,793 Legal & consultancy fees 1,285 - Depreciation 4,653 3,483 Pension case provision 8 25,800 - Interest expense and bank charges 5,645 624 738,921 615,901 OPERATING SURPLUS/(DEFICIT) FOR THE YEAR 2 3,550 (58,187) CORPORATION TAX 3 1,957 2,638 RETAINED SURPLUS/(DEFICIT) FOR THE YEAR 1,593 (60,825)
ACCUMULATED SURPLUS BROUGHT FORWARD 461,456 373,710 GOODWILL CREDITED ON ACQUISITION 13 - 148,571 ACCUMULATED SURPLUS CARRIED FORWARD 11 463,049 461,456
TOTAL RECOGNISED GAINS AND LOSSES - There were no recognised gains or losses other than the gains and losses as shown above.
CONTINUING OPERATIONS - None of the organisation's activities was acquired or discontinued during the above two financial years.
The notes on pages 8 to 11 form part of these financial statements.
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BALANCE SHEET FOR THE YEAR ENDED 31 DECEMBER 2009
2009 2008 Notes ££££
FIXED ASSETS Tangible assets 6 7,173 646
CURRENT ASSETS Debtors 7 108,326 186,895 Cash on deposit 200,000 85,112 Cash at bank and in hand 459,422 460,360
767,748 767,748 732,367 LESS: CURRENT LIABILITIES Creditors and accrued charges 8 310,875 270,560
310,875 310,875 270,560
NET CURRENT ASSETS 456,873 461,807 NET ASSETS 464,046 462,453
Financed by: SHARE CAPITAL 50 (2008 - 398) shares of £1 50 398 each fully paid
RESERVES AND FUNDS Capital reserve - cancelled shares 11 947 599 Accumulated surplus 11 463,049 461,456 464,046 464,046 462,453
Approved by the Council on ……………. and signed on its behalf by
…………………………………………………. - Professor Frances Balkwill CHAIRMAN OBE, FMedSci
…………………………………………………. - Mr Paul Sanders HON. TREASURER
…………………………………………………. - Dr Simon Festing CHIEF EXECUTIVE
The notes on pages 8 to 11 form part of these financial statements.
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2009
1 ACCOUNTING POLICIES Accounting conventions The financial statements are prepared under the historical cost convention, and in accordance with applicable United Kingdom accounting standards.
Cash flow statement The Organisation has taken advantage of the exemption, conferred by Financial Reporting Standard 1, from presenting a cash flow statement as it qualifies as a small company.
Subscriptions and donations Subscriptions and donations are credited to the income and expenditure account in the year to which they relate but credit is not taken in the income and expenditure account for amounts received in advance.
Depreciation of tangible assets Depreciation is provided on tangible assets, at rates calculated to write off the cost, less estimated residual value of each asset over its expected useful life as follows: Computer equipment 25% on cost Office refurbishment 25% on cost
Taxation The Organisation is treated for corporation tax purposes as being mutually trading and is not liable to UK corporation tax on its operating surplus. The charge for taxation is based on investment income for the year.
Operating lease commitments Lease payments under operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses in the periods in which they are incurred.
Pension costs The Organisation operates a defined contribution pension scheme. Contributions payable to this scheme are charged to the income and expenditure account in the period to which they relate. These contributions are invested separately from the Organisation's assets.
Goodwill Goodwill represents the excess of the purchase price over the fair value attributable to the net assets acquired. Goodwill is amortised over its estimated useful life up to a maximum of 20 years. Negative goodwill with no lasting useful life is written back in the year of acquisition as a credit to accumulated reserves.
2 OPERATING SURPLUS FOR THE YEAR BEFORE TAXATION 2009 2008 ££
This is stated after charging: Audit fee 4,500 4,500 Depreciation 4,653 3,483 Operating leases Land and buildings 61,200 61,200
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NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 31 DECEMBER 2009
3 CORPORATION TAX
Corporation tax is payable on the interest income at a rate of 21%. The charge for the year is £1,470.
4 EMPLOYEE INFORMATION 2009 2008 ££ Staff costs: Salaries 388,594 316,918 Social security costs 41,202 31,968 Pension costs 26,547 23,024
456,343 371,910 5 COUNCIL MEMBERS EXPENSES
No Council member received any remuneration for their services during the year. Included within staff and Council expenses are costs in respect of Council members travel and accommodation totalling £575 (2008 - £958).
6 TANGIBLE FIXED ASSETS Office Office refurbishment equipment Total ££ £ Cost or valuation: At 1 January 2009 11,474 11,474 Additions 9,305 9,305 Disposals 0 At 31 December 2009 9,305 11,474 20,779
Depreciation: At 1 January 2009 10,828 10,828 Charge for the year 2,132 646 2,778 Disposals 0 0 0 At 31 December 2009 2,132 11,474 13,606
Net book value at 31 December 2009 7,173 - 7,173
Net book value at 31 December 2008 0 646 646
7 DEBTORS 2009 2008 ££
Trade debtors 86,392 117,540 Other debtors 2,067 1,620 Prepayments and accrued income 19,867 67,735 108,326 186,895
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NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 31 DECEMBER 2009
8 CREDITORS - amounts falling due within 2009 2008 one year ££
Trade creditors 5,278 21,023 Corporation tax 1,470 2,637 Other taxation and social security costs 66,284 34,072 Accruals and deferred income 237,843 212,828
310,875 270,560
Accruals and deferred income includes a provision of £25,800 towards a stakeholder pension deficit. This amount is the Pension Trustees best case estimate of UAR's estimated share of that deficit. The case is due to be heard in late 2010 (see Note 10 below).
9 OBLIGATIONS UNDER OPERATING LEASES 2009 2008 Land and Land and Buildings Buildings ££ Amounts payable within one year on leases expiring: After five years 61,200 61,200
10 CONTINGENT LIABILITY
The Organisation has been informed that there may be a future liability to provide funds to make up a possible shortfall on a historic Company pension scheme. There are 12 ex employees who, although they left the company more than 7 years ago, remain as future beneficiaries of the scheme. The scheme trustees have advised that the proportion of the shortfall that may need to be borne by the Organisation could be between £25,800 and £240,800. A group of employers is disputing the claim, but if it suceeds we are advised that the liability may be paid off over a period of 10 years. As a result the Council have agreed to provide £25,800 in this current year (refer also to note 8 under creditors).
11 STATEMENT OF MOVEMENTS ON RESERVES Accumulated Capital surplus reserve
Balance at 1 January 2009 461,456 599 Cancelled shares during the year - 348 Deficit for the year 1,593 -
Balance at 31 December 2009 463,049 947
12 RELATED PARTY TRANSACTIONS
There were no related party transactions during the year.
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NOTES TO THE FINANCIAL STATEMENTS (continued) FOR THE YEAR ENDED 31 DECEMBER 2009
13 GOODWILL
On 31 December 2008 Understanding Animal Research acquired all the assets and liabilities of Coalition for Medical Progress (a company Limited by Guarantee). The assets acquired had a fair value of £148,571 at that date and this has been written back in full at acquisition as a credit to the Accumulated Surplus of the Organisation. Goodwill acquired is made up as follows: £ Tangible fixed assets at fair value 646 Prepayments 662 Cash at bank 245,584 Creditors (98,321) 148,571
- 11 - Understanding Animal Research, 25 Shaftesbury Avenue, London W1D 7EG Telephone 020 7287 2818 Facsimile 020 7287 2627 Email [email protected] www.UnderstandingAnimalResearch.org.uk Registered number IP28954R