Donore Credit Union Annual Report 2020

Annual Report 2020 Notice of Virtual Annual General Meeting of Donore Credit Union will take place online Tuesday March 30th at 7pm.

To register please log onto www.donorecu.ie or scan the below QR code

do with

Virtual AGM 2020

CREDIT C REDIT U UNION NION

Donore Credit Union Limited is regulated by the Central Bank of Ireland

donorecu.ie

Ireland’s First Credit Union and the Independent Credit Union of Dublin 8

CONTENTS

04

07

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26

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31

32

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49

Notice of Virtual Annual General Meeting

Report of the membership committee

Report of the Board Oversight Committee

Statement of Board Oversight Committee’s Responsibilities

Statement of Cash Flows

Chairperson’s Address

Independent Auditor’s Report

Notes to the Financial Statements

CEO Report

Report of the Nomination Committee

Income & Expenditure Account

Report of the Credit Committee

Report of the Audit Risk and Compliance Committee

Balance Sheet

Report of the Credit Control Committee

Statement of Directors’ Responsibilities

Statement of Changes in Reserves

Schedules to the Income & Expenditure Account

Coming Soon - Green Loan Scheme We all know the importance of tackling the climate ETKUKU /CMKPI QWT JQOGU OQTG GPGTI[ GHƂEKGPV JCU an important role to play in that. While many of us have a desire to improve the warmth and energy GHƂEKGPE[ QH QWT JQOGU KV ECP DG FKHƂEWNV VQ MPQY where to start. What type of work will make the biggest difference? What grants are available?

Who is best placed to carry out the work? How can the work be funded?

Donore CU will shortly be launching a new scheme to help our members carry out GPGTI[ GHƂEKGPV JQOG KORTQXGOGPVU YKVJ CNN QH VJG UWRRQTVU CXCKNCDNG KP QPG RNCEG Keep an eye on

donorecu.ie for more information.

DONORE CREDIT UNION ANNUAL REPORT 2020

INVOCATION Lord, make me an instrument of thy peace, Where there is hatred, let me sow love; Where there is injury, pardon; Where there is doubt, faith; Where there is despair, hope; Where there is darkness, light; And where there is sadness, joy.

O divine Master grant that I may Not so much seek to be consoled as To console; to be understood as to Understand; to be loved as to love; For it is in giving that we receive, It is in pardoning that we are pardoned, And it is in dying that we are born to eternal life.

AGENDA

• Acceptance of proxies (if any) by the Board of Directors • Ascertaining that a quorum is present and reading of Invocation • Reading and approval (or correction) of minutes of previous A.G.M. • Directors and other information • Adoption of Standing Orders • Chairperson’s Address • Report of the Directors • Statement of Directors Responsibilities • Statement of the Board Oversight Committee Responsibilities • Report of the Auditor (incl consideration of accounts) • Accounting Policies • Notes to the Financial Statements • Report of the Nomination Committee • Report of the Board Oversight Committee • Report of the Credit Committee • Report of the Credit Control Committee • Report of the Membership Committee • Report of the Audit Risk and Compliance Committee • CEO Report • Appointment of Tellers • Motions for Members • Any other business • Announcement of election results • Draws – Prizes of €50 • Adjournment or close of Meeting 1

RULE AMENDMENTS MOTION 1 That this Annual General Meeting amends the Standard Rules for Credit Unions (Republic of Ireland) by the insertion of a new Rule 1A as follows: Any reference in these rules to a member present and voting at a general meeting shall be construed as including a reference to a member in attendance and voting at a general meeting conducted wholly or partly by the use of electronic communications technology.

(4)

(5)

MOTION 2 That this Annual General Meeting amends Rule 96 of the Standard Rules for Credit Unions (Republic of Ireland) in paragraph (1), by the substitution of “at a time, at a place in the State (where applicable) and in the manner (where applicable)” for “in the State at such date, time and place”, And by the insertion of a new 96A as follows: 96A (1) The credit union need not hold a general meeting at a physical venue but may conduct the meeting wholly or partly by the use of electronic communications technology as long as all attendees have a reasonable opportunity to participate in the meeting in accordance with this Rule.

(2) (a) The credit union may provide for participation in a general meeting by providing or facilitating, for that purpose, the use of electronic communications technology, including a mechanism for casting votes by a member, whether before or during the meeting. (b) The mechanism referred to in paragraph (a) shall not require the member to be physically present at the general meeting.

(3) The use of electronic communications technology pursuant to paragraph (2) may be made subject only to such requirements or restrictions put in place by the credit union as are iViÃÃ>ÀÞ Ì i ÃÕÀi Ì i `i Ì wV>Ì of attendees and the security of the electronic communications technology, 2

(6)

(7)

to the extent that such requirements or restrictions are proportionate to the achievement of those objectives.

The credit union shall inform attendees, before the general meeting concerned, of any requirements or restrictions which it has put in place pursuant to paragraph (3).

The credit union that provides for the use of electronic communications technology for participation in a general meeting by an attendee shall endeavour to ensure, as far as practicable, that (a) such technology: (i) provides for the security of any electronic communications by the attendee, (ii) minimises the risk of data corruption and unauthorised access, and (iii) provides certainty as to the source of the electronic communications. (b) in the case of any failure or disruption of such technology, that failure or disruption is remedied as soon as practicable, and (c) such technology enables the attendee to: (i) hear what is said by the chair of the meeting and any person introduced by the chair, and (ii) speak and submit questions and comments during the meeting to the chair to the extent that the attendee is entitled to do so under the rules of the credit union.

Any temporary failure or disruption of electronic communications technology shall not invalidate the general meeting or any proceedings relating to the meeting.

Unless such failure or disruption is attributable to any wilful act of the credit union, the credit union shall not be liable in respect of any failure or disruption relating to the equipment used by an attendee to access a general meeting by electronic communications technology that occurs and which failure or disruption prevents or interferes with the attendee’s participation, by the use of such technology, in the meeting.

DONORE CREDIT UNION ANNUAL REPORT 2020

(8)

Where, in the opinion of the board of directors, it is deemed necessary, due to exceptional and unexpected circumstances, the board of directors may, by resolution, cancel a general meeting at any time prior to the holding of the meeting.

MOTION 3 That this Annual General Meeting amends Rule 98 of the Standard Rules for Credit Unions (Republic of Ireland) (a) In paragraph (2): (i) by the substitution of the following paragraph for paragraph (a): “(a) shall state the date, time, place (where applicable) and manner of holding (where applicable) of the general meeting;”, (ii) in paragraph (c), by the substitution of “;” for “; and”, (iii) in paragraph (e), by the insertion of “and”, (iv) by the insertion of the following paragraph after paragraph (e): (f) shall, in the case of a general meeting proposed to be held wholly or partly by the use of electronic communications technology, state (i) the electronic platform to be used for the meeting, (ii) details for access to the electronic platform, (iii) where required by a credit union, the time and manner by which an >ÌÌi `ii ÕÃÌ V wÀ Ã À iÀ intention to attend the meeting, (iv) any requirements or restrictions which the credit union has put in place in order to identify attendees who intend to attend the meeting, (v) the procedure for attendees to communicate questions and comments during the meeting, and (vi) the procedure to be adopted for voting on resolutions proposed to be passed at the meeting.” (b) In paragraph (4), by the insertion of “and containing such information” after “in such form”.

And by the insertion of a new Rule 98A as follows: 98 A (1) Notwithstanding Rule 98 but subject to paragraph (2), notice for the purposes of Rule 96A(8) shall be given in the same manner as the notice for the general meeting referred to in Rule 98 but where, in the opinion of the board of directors, giving such notice in that manner is not reasonably practicable, notice shall be given (a) where the credit union has a website, on that website, (b) by email to every member for whom the credit union has an email address, and (c) in at least one national newspaper published in the State and circulating in the area in which the Ài} ÃÌiÀi` vwVi v Ì i VÀi` Ì Õ is situated, in a local paper and on local radio.

(2) Paragraph (1) shall not apply where all members agree in writing to the cancellation, change of venue or change of means of holding the general meeting concerned, or to dispensing with notice for the general meeting.”.

MOTION 4 That this Annual General Meeting amends Rule 99(3)(a) of the Standard Rules for Credit Unions (Republic of Ireland) by the substitution of “paragraphs (a), (b), (d) (e) of paragraph (2)” for “paragraphs (a), (b), (d), (e), (f) of paragraph (2)”.

MOTION 5 In accordance with Section 44 of the Credit Union Act, 1997 (as amended), this Annual General Meeting approves the establishment of a community fund to be used by the credit union for social, cultural or charitable purposes (including community development), and thereafter the Board may provide, in line with Section 44 of the Credit Union Act, 1997 (as amended), a maximum annual contribution of up to 0.5% of total assets from the surplus funds at year-end to the community fund. The purpose of the community fund is to support projects within the common bond of Donore Credit Union for social, cultural or charitable purposes (including community development).

Such projects must be located within our V L ` > ` Ã Õ ` ÀiyiVÌ Ì i iÌ Ã > ` values of Donore Credit Union and the Credit Union movement 3

Win Cash Prizes on the Night AGM prize draw will be based upon registered members. The request for attendance must be received by 5pm on Monday, 29 March 2021 at the latest.

VIRTUAL ANNUAL GENERAL MEETING OF DONORE

NOTICE OF

CREDIT UNION LIMITED

online Tuesday March 30th at 7pm.

To register please visit www.donorecu.ie will take place

and follow the link.

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DONORE CREDIT UNION ANNUAL REPORT 2020

NOTICE AND FORMAL INVITATION OF THE ANNUAL GENERAL MEETING. TUESDAY, MARCH 30TH AT 7PM VIRTUAL AGM 2020 Notice is hereby given that the Annual General Meeting of Donore Credit Union will take place on Tuesday March 30th 2021 at 7pm.

Pre-registration is required by members.

Please register at www.donorecu.ie.

An email with instructions and log in details will be emailed to registered members only.

All members are welcome to attend. | Hilda Hyland SECRETARY Donore Credit Union Limited Due to the nature of COVID-19 and the restrictions in place, for public health reasons on organised indoor gatherings in the Republic of Ireland, credit unions have been given permission to host their AGM’s online.

Please note the following in relation to this Virtual AGM: • Members are requested to Pre-Register for Donore Credit Union Ltd. Virtual AGM. • To Pre-Register members are asked to visit our website www.donorecu.ie and complete an online registration form.

• Members will require their member number and a valid email address and phone number to pre-register.

• Once a member has completed the online Pre-Registration Form, the member will receive an email within 24 hrs containing a unique access link to the Virtual AGM with instructions. Please note the access link is unique to each member and acts as an identifier for the Virtual AGM. We would ask that you do not share this access link with anyone else.

• Members can also email info@donorecu.ie or call us on 01 4536686 to request a registration link.

• Members are requested to pre-register no later than 5pm on Monday 29 March 2021.

• Voting will be by virtual means and take place during the online AGM. Instructions as to how to place a vote, will be given on the night. | David McAuley CEO Donore Credit Union Limited Donore Credit Union has provided a downloadable pdf of the Annual Report booklet which can be downloaded from www.donorecu.ie 5

Grew membership by

5%

to

4,935

Offered three types of savings products

Continued to provide free insurance

Issued

1,179

new loans totalling €5.1 million

Offered nine types of loan products ranging from

€100 to €150,000

Played an active role in community forums and networks

Supported 16 community groups

Serviced 333 budget accounts Increased profile in the press and on social media

Organised some

20

prize draws

Delivered financial awareness education in all local primary and secondary schools Brilliant credit union. Fantastic staff. Could not be more helpful.

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DONORE CREDIT UNION ANNUAL REPORT 2020

Chairperson’s Address On behalf of the Board of Directors I am pleased to present to you, our members, the Financial Statements and Annual Report at the 62nd Annual General Meeting of Donore Credit Union Ltd. / Ã >Ã Lii > ÛiÀÞ ` vwVÕ Ì Þi>À v À Ì i V Õ ÌÀÞ > ` ÕÀ V Õ ÌÞ° 7i >Ûi ÃÌ i } L ÕÀÃ and friends and seen massive changes to what we consider normal. 2020 has been the year of Covid-19 and Donore Credit Union Ltd like everywhere has been affected. Your credit union like all credit unions is designated an “essential service” and we have remained open and operating all during this crisis.

While this has been challenging, I must recognise the professionalism of staff, our CEO David, management and volunteers in ensuring no disruption to services and ensuring the credit union operated safely during the period. We are not out of this situation yet, and will continue to operate in line with safety protocols but light is on the horizon and again Donore Credit Union will emerge stronger and as resilient as ever.

As a board our main concern for 2020 was to ensure that members and staff safety was paramount. Measures were put in place to ensure physical distancing for staff and members. As an organisation that prides itself on our friendly and personal service that has been a challenge, however, I feel we have managed that well. I must also thank you the members for your steadfast loyalty to our credit union. À > w > V > «iÀëiVÌ Ûi] Ì i }i iÀ> iV Þ >à ÃÕvviÀi`° - i i LiÀà > ` v> ià >Ûi lost jobs, or had income cut. Donore Credit Union prides itself on understanding our community > ` >Ì > Ì ià Üi >Ài V ÌÌ } Ì Ü À } Ü Ì i LiÀÃ Ü >Þ Li > Þ w > V > ` ÃÌÀiÃð Covid will end, incomes will improve, Donore will stay with our members through everything.

While loan demand has decreased because of lock downs, I am delighted to announce we actually grew our loan book by 9% in 2020. As well as growing our loan book, we continue to grow our membership numbers.

In 2020 our loan interest income has grown by 12%, however, investment returns decreased by 45%. Investments returns are at an all-time low with some deposit takers now only offering negative interest rates. These historically low rates are unlikely to change any time soon, so it is vital we continue to grow our loan book.

Expenses increased as the Board took the decision to substantially increase the bad debt provision by €270k – this is the primary reason for the low surplus this year. We are unsure of the long term effects of Covid 19 and this is a prudent decision. > Þi>À Ü iÀi ÛiÃÌ i Ì ÀiÌÕÀ Ã >Ài Ì i ÜiÃÌ iÛiÀ] Ü Ì Ì i w > V > ivviVÌÃ v Û ` > ` > reduced loan demand, for your Credit Union to achieve a surplus is a good achievement.

In September 2020, the Central Bank advised all credit unions “to maintain strong levels of reserves over the payment of any distribution to members”. Therefore, the Board is not in a position to propose a dividend. Instead, we will be using the surplus to bring the level of the 7

regulatory reserve back up to 2019 levels, and the balance to be moved into a “community fund” with members approval.

Under Section 44 of the Credit Union Act, the credit union is permitted as a once off to establish a Community Fund which the Board will avail of to support local organisations in our common bond.

As you are aware, Donore Credit Union heavily supports lots of projects and worthy organisations in the area. The establishment of this fund will create a more formalised and transparent process for those applicants and our members. The rules of the Credit Union, however, do need to be changed by members and we are putting this matter to the member’s vote and recommend member’s support this motion.

The Board is determined to grow our Credit Union in a steady and consistent way in line with the strategic plan. We continue to modernise our services and our focus remains on implementing V > }ià ii`i` Ì i ÃÕÀi Üi >Ài > `iÀ wÌ v À «ÕÀ« Ãi Ài` Ì 1 ° 7i ` Ì ÃÕLÃVÀ Li Ì the notion that “bigger is better” but rather we believe in “being better for our members”.

Ài Ài` Ì 1 Ã Ì À Û } > ` à > w > V > Þ ÃÌ>L i > ` Àià i Ì À}> Ã>Ì ° > Ì iÀ wÀÃÌ ÓäÓä] Ài Ài` Ì 1 LiV> i Ì i wÀÃÌ VÀi` Ì Õ Ài > ` Ì Õ `iÀÌ> i a “Social Return on Investment project»° Ƃà > VÀi` Ì Õ > ` > Ì v À «À wÌ À}> Ã>Ì ] Üi believe we must highlight what we do in the community and the impact we have on members. À Ì } V ÛiÀÃ>Ì Ã VÀi` Ì Õ Ã v VÕà i Ì Ài Þ º«À wÌ»] Üi >Ài Ì > L> ] > ` Üi ` ½Ì Li iÛi Üi Ã Õ ` i>ÃÕÀi ÕÀÃi ÛiÃ Þ Ì >Ì Ü>Þ° ÓäÓä Üi µÕ> Ì wi` Ì À Õ} ] > independently accredited and internationally recognised process that for every €1 input to credit Õ ] Ì iÀi à > å£ä «>VÌ Ì i i LiÀà > ` V Õ ÌÞ° >Ãi` Óä£ w > V > w}ÕÀià Üi had €2.5m inputs, therefore our social impact is €25m.

We continue our support of local schools, clubs, associations and we awarded the “Brendan Lynch -V >ÀÃ «» ­ V Õ VÌ Ü Ì À vwÌ i}i® > ` >Õ V i` > iÜ ÃV >ÀÃ « Ì i > i v “Aingil ni Bhroin”, the founder of Donore Credit Union.

7i >Ûi > >}i` Ì `i >Þ > Þ V > }iÃ Ì ÕÀ i>Ì i iwÌ > ` - >Ài > ` > ÃÕÀ> Við / Ài ` i LiÀà i>Ì i iwÌ ÃÕÀ> Vi à > « VÞ Ì i Ài` Ì 1 «>Þà Li > v v i LiÀà and comes directly from operating income. In 2018 our AGM approved a €10 member charge per Þi>À] Ì i ÃÕÀi Ì i «ÀiÃiÀÛ>Ì v Ì Ã Li iwÌ } } v ÀÜ>À`° ÜiÛiÀ] ÕÀ V Ì i Ì Ài > à that this will only be proposed if circumstances dictate and its contingent on members consent.

Social Return on Investment Report Resources invested Shares/deposits/assets €1,557,354

Total €2.636m

Loan interest €903,008 Volunteer time €135,000 Unpaid staff time €25,000 Budget account fees €16,650

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“

DONORE CREDIT UNION ANNUAL REPORT 2020

For every €1 equivalent invested into Donore Credit Union, in the region of €10 of social value was created. €1 : €10”

We stay committed to providing face to face service in a friendly welcoming environment, offering the same traditional approach in a modern way.

Donore Credit Union is the natural locally run home Credit Union for everyone in the Liberties, South Circular Road and Dublin 8 who want the services of a local community credit union. Please remember to encourage your family, neighbours, friends and colleagues to join us. We are open to new members.

Donore Credit Union is the last independent credit union in Dublin 8 and relies on members using our services.

We know how proud the members of this Credit Union are of the history and status of Donore Credit Union. Members, Volunteers, families and the trust of generations of people is something remarkable, let’s continue with this testament to the strength of your community. Support your Credit Union.

IN CONCLUSION May we take a moment to remember all deceased members of the Credit Union who passed away this year.

May they all Rest in Peace.

May I take this opportunity to wish directors, volunteers and Board Oversight Committee members no longer seeking re-election well for the future and to thank them for their service.

I wish to thank the Board of Directors, the Board Oversight Committee, our CEO David and staff for the huge amount of effort they have put in again this year. We are thankful to you, the members for your support, keep saving, keep borrowing and keep letting us know what we can do for you.

Garrett O’Toole Chairperson

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CEO REPORT Dear members ÓäÓä Ü>Ã Õ ` ÕLÌi` Þ i v Ì i ÃÌ ` vwVÕ Ì > ` V > i } } Þi>Àà >à > à V iÌÞ Üi v>Vi`° À the perspective of Donore Credit Union we rose to that challenge and again demonstrated our Àià i Vi] yiÝ L ÌÞ] >} ÌÞ > ` V>«>V ÌÞ° Everyday our staff came to work and made sure our members were served. Great credit must go to all the staff for their professionalism and commitment.

While fewer loans were issued in 2020, it is obvious our members realise that our loans are very competitively priced and our members see us as a great option when borrowing.

Donore Credit Union remains committed to prudent lending and loans are only granted where your ability to repay is shown. Increasingly, members are deciding to do side by side loans knowing they can borrow for the larger items as well as their smaller regular loan. + CO FGNKIJVGF VQ CPPQWPEG VJCV KP &QPQTG %TGFKV 7PKQP YKNN DG QPG QH VJG ƂTUV ETGFKV WPKQPU VQ NCWPEJ VJG PGY +TKUJ .GCIWG QH %TGFKV 7PKQPU DCEMGF PCVKQPCN p%7 )TGGPGT .QCPq 9KVJ ITCPVU QH WR VQ CXCKNCDNG HQT TGVTQƂVVKPI PGVVKPI QHH CICKPUV EQUV KV KU C ITGCV opportunity for members to talk to us.

In 2021, Donore Credit Union teamed up with CUNA Mutual to offer some new insurance products through the PEOPL. Brand. Members can via our website get quotes for home, travel and life insurance. This is another option for members to save money while getting better cover with products designed for credit union members Ì i ` vwVÕ Ì V ÀVÕ ÃÌ> ViÃ] Û ` >ÀÀi>ÀÃ > ` L>` `iLÌÃ Ài > i` Ü Ü i ÀiV ÛiÀÞ v bad debts was higher than last year. During the year we added to our management team and ÌiÀ > Þ Ài À}> Ãi` Ì «À Ûi ivwV i VÞ° In 2020 we again built on our IT platforms by adding over the phone payment service and an on-line web payment service. We introduced the full on-line loan application and approval system, which enables members to apply for, upload all their documents and collect their loan Ü Ì ÕÌ V } Ì vwVi° ÓäÓ£ Üi Ü Li ÌÀ `ÕV } > i iÜ i LiÀ L >À` } process, meaning new members can join remotely.

2020 led to a lot of our members changing their behaviour and more members signed up for our mobile app with many switching over to electronic funds transfer, direct debits and credit transfers.

This means that more routine tasks can be automated, with staff time freed up to do what we do best and engage with our members. This allowed us during the pandemic, to contact vulnerable and elderly members just to reach out and say hello.

Unfortunately, we had to cancel a lot of community events however, many organisations still ii`i` ÕÀ i « > ` Üi ÜiÀi `i } Ìi` Ì vviÀ VÀi>Ãi` ÃÕ«« ÀÌ Ì "ÕÀ >`޽à ë Vi] V> Food Drive for the elderly, the Dublin Soup Kitchen and St Vincent de Paul amongst others. We maintained our normal support of the Old Folks Associations, Residents associations, Donore Ý } ÕL] iÛ Ã ÕÀ } > ` Ì i V> ÃV ð 10

DONORE CREDIT UNION ANNUAL REPORT 2020

In 2020 we continued to push the message that our Credit Union is there for members and from the community. We continue to put the Credit Union back at the heart of the community and our message as the independent credit union of Dublin 8, has really resonated with members and new members.

Our Social Return on Investment report demonstrates that the credit union makes a massive contribution to the community. By conducting this study, it is clear that member’s really want and ii` Ì i VÀi` Ì Õ ] Ì >Ì Ì i VÀi` Ì Õ v VÕÃ ÃiÀÛ Vi >Ã «« Ãi` Ì «À wÌ Ã V ÀÀiVÌ > ` that engagement between credit union and members must be two way. On that basis in 2021, we will be launching a number of surveys, asking members what they want from us and where they want us to do better.

We believe that members and prospective members are attracted to organisations in which they feel they have a real say. We will continue to push this message. People do not want to be part v >À}i v>Vi iÃÃ w > V > ÃÌ ÌÕÌ Ã > ` >Ì Ài Ài` Ì 1 Üi Ü> Ì Ì «ÀiÃiÀÛi Ì i Õ µÕi vÀ i ` Þ v>Vi Ì v>Vi ÃiÀÛ Vi Üi >Ài Ü v À° Ài Ài` Ì 1 Ã Ì > «À wÌ À V ÃÌ Vi ÌÀi] this remains and always will be a people centre.

As Dublin 8 loses more bank branches and people are increasingly being forced to deal on-line with their banks, we know we are different and want to continue to remain different. After all it is good to talk. ÓäÓä Üi à } wV> Ì Þ VÀi>Ãi` ÕÀ à V > i` > «ÀiÃi Vi > ` Üi >Ûi ÛiÀÞ >VÌ Ûi v À >Ì Ûi Facebook and Instagram accounts. We like to keep our website refreshed and updated, while our Newsletter and press releases are well received by our members. Our communications are not about the hard sell of our services, but we aim to be informative and keep members abreast of all community news.

Staff of the Credit Union worked exceptionally hard to meet these challenges. We will continue Ì v>Vi iÜ V > i }ið > V w`i Ì Ì >Ì Ì iÃi Ü Li ÛiÀV i LiV>ÕÃi v Ì i Ài>VÌ v ÕÀ i LiÀÃ Ì Ì i À Ài` Ì 1 ° Ài` Ì 1 à >Ài Õ`}i` Ì i À Û >L ÌÞ w > V > w}ÕÀià > ` > `i } Ìi` ÕÀ w}ÕÀià > ` «À iVÌ Ã >Ài ÛiÀÞ ÃÌÀ }° Donore common bond area is a growing thriving area of Dublin and new residents are potential Credit Union members. We are aiming to continue to grow our membership. We are reliant on you the member to promote and canvass for your Credit Union. Whether it be a new neighbour, work colleague, family member please encourage them to join Donore Credit Union. v ÀÜ>À` Ì V > i }ià > i>` > ` > V w`i Ì LÃÌ>V iÃ Ü Li ÛiÀV i > ` Üi V> deliver the success your Credit Union deserves. Thank you for your support.

David McAuley CEO

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MEET OUR TEAM

DONORE CREDIT UNION ANNUAL REPORT 2020

DIRECTORS AND OTHER INFORMATION DIRECTORS

Garrett O’Toole (Chairperson) Catherine Massey (Vice Chairperson) `> Þ > ` ­-iVÀiÌ>ÀÞ® Ƃ} ià ivviÀ > Mary Keville Niall Reilly Phyllis Masterson Kathleen Kenna Angela Kavanagh

BOARD OVERSIGHT COMMITTEE MEMBERS

Mark Barnes Ann Bradley Alice O’Connell

CREDIT UNION NUMBER

133CU

REGISTERED OFFICE & BUSINESS ADDRESS

22 Rutledge Terrace South Circular Road Dublin 8

AUDITORS

Whelan Dowling & Associates Chartered Accountants and Statutory Audit Firm Block 1, Units 1 & 4 Northwood Court Santry Dublin 9

BANKERS

Ulster Bank 33 College Green Dublin 2

SOLICITORS

John Gaynor & Co 42/46 Thomas Street Dublin 8

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DIAMOND Plus ONE Loan LOAN CALCULATOR IS AVAILABLE AT www.donorecu.ie TYPE OF LOAN Diamond Plus ONE loan from 7% (7.25% APR)

ondE m a Di s ONte Pluan ra lo

7% €15,000 5 Years

SAMPLE REPAYMENT OVER 5 YEAR Weekly €68.38

Total €17,777.28

Interest €2,777.28

APR 7.25%

Fortnightly €137.84

Total €17,787.15

Interest €2,787.15

APR 7.24%

Monthly €297.02

Total €17,820.50

Interest €2,820.50

APR 7.23%

#NN ƂIWTGU CTG HQT KNNWUVTCVKXG RTQRQUGU QPN[ WARNING: If you do not meet the repayments on your loan, your account will go into arrears. This may affect your credit rating, which may limit your access to credit in the future.

Loans subject to approval. Terms & Conditions Apply.

Donore Credit Union Limited is regulated by the Central Bank of Ireland

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DONORE CREDIT UNION ANNUAL REPORT 2020

“

The purpose of the Credit Union is to allow members save together and lend to each other at a fair and reasonable rate of interest.”

15

REPORT OF THE CREDIT COMMITTEE Dear Member The Committee’s main role is to oversee the lending function and ensure policies and underwriting standards are being adhered to. The Committee is also responsible for monitoring the performance of the loan book and the proposal of new loan products.

Meetings of the Committee were less frequent this year as we had to adapt in light of the } } i> Ì ÃÃÕiÃ] ÜiÛiÀ] Üi >Ài Ã>Ì Ãwi` Ì >Ì ÕÀ i ` } vÕ VÌ Ài > Ã «ÀÕ`i Ì > ` underwriting standards remain very strong.

The overriding principles for all lending decisions remains the members ability to repay and our >ÃÃiÃÃ i Ì v À Ã ° 7i >V Ü i`}i Ì i `i` V>Ì v ÕÀ > vwViÀÃ `ÕÀ } Ì Ã ` vwVÕ Ì Þi>À° In 2020, member loan demand dropped, however, we still recorded an increase in our loan book of 9%. Our loan book stands at €10.6m versus €9.8m in 2019. Our little credit union, once again being a star performer amongst Dublin’s credit unions.

Members are borrowing larger amounts from us and with competitively priced loan products and introduction of the CU Greener Loan, we expect this to continue.

While members can borrow larger amounts, we still offer the smaller more emergency loans and with our “side by side” offering members can be assured we will always manage their loans in the most cost-effective way. Members do not need to go anywhere else to borrow as all borrowing requirements can be met through this credit union.

Lending is the core function of our credit union. The Committee is aware we face challenges, however, we will continue to proactively make changes to ensure we offer our members value and great service. We will always offer face to face service so our members can get proper advice before they make any borrowing decision. À ÛiÀ ÈÓ Þi>ÀÃ Ì Ã Ài` Ì 1 Ã Ì iÀi v À i LiÀð 7 i L> à Ãii > à >à w > V > transactions, we understand that a loan is much more, it may be a need met, a dream achieved, an ambition realised but behind every loan is a person/a family that the credit union commits to being there for no matter what. / à Ài` Ì 1 >à à } wV> Ì Àià ÕÀViÃ Ì i ` à Üi i V ÕÀ>}i ÕÀ i LiÀÃ Ì Ì> Ì Õà to discuss any loans however big or small. When a member borrows from this credit union, local money is kept local and reinvested back into making our community better. +P YG KUUWGF NQCPU VQ VJG XCNWG QH a O 6JG CXGTCIG UK\G QH NQCP KPETGCUGF HTQO a VQ a Finally, this Credit Union is proud of it’s history as a prudent lender and we will never push unaffordable loans on members, Angela Kavanagh On behalf of the Credit Committee

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LOAN BOOK GROWTH 9% ONE OF THE BEST IN DUBLIN

DONORE CREDIT UNION ANNUAL REPORT 2020

REPORT OF THE CREDIT CONTROL COMMITTEE The function of the Credit Control Committee is to ensure that all loans are paid back in line with the loan agreement signed at time of issue.

The Committee meets monthly to review any loans that have fallen into arrears and to keep track v Ì i ÛiÀ> «>ÌÌiÀ v > Ài«>Þ i Ìð / i ÌÌii > ÃiÃ Ü Ì i ` } "vwViÀà > ` Ài` Ì Committee to monitor any patterns around arrears. Finally, the Committee is responsible for ensuring a robust debt recovery system is in place and is empowered to act through a variety of processes to ensure recovery of monies.

Once a loan falls into arrears members are contacted as are guarantors if such are in place. A member who acts as guarantor for another member is responsible for all monies owed by that member and will have their savings secured against that loan.

"LÛ Õà Þ] ÓäÓä Ü>à > ` vwVÕ Ì Þi>À v À à i i LiÀÃ Ü Ì À Õ} v>Õ Ì ÃÕ``i Þ v Õ ` Ì i Ãi Ûià w > V > Þ ` vwVÕ Ì V ÀVÕ ÃÌ> Við 7 i V ` Ü Ã ÃÌ>ÀÌi` Ì i Ài` Ì 1 immediately responded by putting in place processes to help and manage those in that situation. By being proactive and empathetic we were able to put in place temporary measures v À i LiÀð 7i >Ài Ã>Ì Ãwi` Ì >Ì Ì Ãi i>ÃÕÀià >Ài Ü À } v À L Ì Ì i VÀi` Ì Õ > ` the members. Donore Credit Union understands that a members relationship with us is usually lifelong, so once a member is prepared to work with us, we will manage the situation until things turnaround for that member.

We had 31 temporary arrangements with members and 29 of those are meeting agreements. / i ÌÌii >VVi«ÌÃ Ì >Ì > Þ i LiÀ V> }iÌ Ì ` vwVÕ ÌÞ vÀ Ì i Ì Ì i > ` Ü i Ì Ã happens it is important to contact our Credit Controller immediately to discuss a solution to the arrears problem. It is the Board’s policy to do everything possible to assist the member, however, where the Committee determine there is an unwillingness to repay or an unreasonableness with regards to proposals, all options will be invoked to ensure return of monies.

The Board of Donore Credit Union is very aware we are lending member’s money. We treat delinquency as a serious matter. We will use all available means to ensure we get repaid including debt recovery agents and all legal avenues. With regards to the term “written off”, this refers Ì Ì i >VV Õ Ì } ÌÀi>Ì i Ì v > > > ` >ÀÀi>ÀÃ Ì i w > V > >VV Õ ÌÃ > ` Ì Ü Ì i Credit Union views an outstanding debt. This Credit Union will continue to actively pursue any outstanding debt.

There were 8 members accounts written off during the year totalling €44k compared to 7 for €14k last year. The Committee positively note that our arrears remain very low and despite our > L VÀi>à } Üi >Ài Ã>Ì Ãwi` Ì >Ì > Õ `iÀÜÀ Ì } ÃÌ> `>À`à >Ài ÛiÀÞ } > ` Ài` Ì Risk is being assessed during loan applications. Due to the current unknowns with the long term « V>Ì Ã v Û ` £ ] Ì i ÌÌii Li iÛi Ì i à } wV> Ì VÀi>Ãi L>` `iLÌ «À Û Ã Ã Ã prudent.

Recovery of bad debts was excellent at €222k compared to €148k last year We successfully through legal action recouped some individual large debts and we will continue to target individuals in 2021, who mistakenly think they can walk away. We are committed to ensuring we pursue our members monies in a cost effective manner. This is our commitment to you our member.

Hilda Hyland On behalf of the Credit Control Committee.

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REPORT OF THE MEMBERSHIP COMMITTEE Dear Member The Committee’s main functions are • to review membership applications and ensure they comply with the Criminal Justice Act 2010 (as amended) • to encourage growth in membership numbers. / i ÌÌii à Ã>Ì Ãwi` Ì >Ì > iÜ i LiÀà ÜiÀi V iV i` Ì i ÃÕÀi V « > Vi Ü Ì legislation and that systems are in place to ensure all members proof of ID and addresses are kept up to date, The active membership on the 30th September 2020 was a net increase of in net members, this despite us not being able to take on new members at various times during the year due to Covid-19 safety lockdowns. We also had to suspend membership drive and publicity campaigns during the year Despite this our credit union has again seen growth in membership numbers. Our membership exceeded 5,000 members in December 2020.

Our focus remains on increasing our membership numbers and getting both the new and existing members engaged, using our services and borrowing from the credit union.

We aim to be a modern, professional, community based and member owned cooperative for a vibrant, growing, changing area of Dublin 8. As the last and only independent credit union in Dublin 8, we need residents to join and preserve their local essential service.

In 2021 we are going to see more bank branches close and there will be more credit union mergers. By encouraging your families, friends, neighbours, college pal or work colleagues to join, you can ensure that the Liberties will keep it’s credit union alive.

7i Ü> Ì Ì i VÕ ÌÕÀi > ` V >À>VÌiÀ v Ì Ã VÀi` Ì Õ Ì ÀiyiVÌ Ì >Ì v ÕÀ i LiÀà « > ` V Õ ÌÞ Ì Õ} ] Àià i Ì] i } L ÕÀ i « } i } L ÕÀ > ` wiÀVi Þ Þ> ° Finally, as a member of Donore Credit Union you are the owner of the credit union. You have your Ã>Þ° v Þ Õ Li iÛi Ì >Ì V> iÞ] Ã Õ ` Li i«Ì V> > ` Ì >Ì Ì iÀi Ã Õ ` Li > V> w > V > service where you can drop by and discuss a loan, please encourage all to join us.

Thank You Agnes Heffernan On behalf of the Membership Committee

BANK BRANCH HEADING FOR EXIT DOOR. WHY NOT

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DECEMBER 2020 MEMBERS EXCEEDED

DONORE CREDIT UNION ANNUAL REPORT 2020

REPORT OF THE BOARD OVERSIGHT COMMITTEE The Board Oversight Committee primary function is to attend and observe monthly Board meetings and to ensure the members interests are protected. In this regard the BOC has performed its function and is pleased to submit our annual report to the members of the Donore Credit Union.

We can report that in our opinion the Board has been compliant in its legal and regulatory requirements and has dealt with any risk and compliance issues which have arisen during the year.

The arrival of Covid19 created issues in relation the monthly Board Meetings, and the various Committee Meetings, to the credit of all they responded positively to virtual meetings by way of conference calls and Microsoft Teams.

7i V « i Ì Ì i " > ` Ì i ÃÌ>vv v À Ì i À Ã>VÀ wVià > ` `i` V>Ì ÃÕV > ` vwVÕ Ì Ì i° The BOC held our monthly meetings following the Board meeting to review the content, minutes > ` ` ÃVÕÃà à v Ì i >À` iiÌ }ð " > µÕ>ÀÌiÀ Þ L>à Ã] Ì i " Ài« ÀÌà Ìà w ` }à > ` presents to the Board.

We would like to thank the Chair and the Board for the courtesy extended to us and their acceptance of the issues we raised.

7i >Ûi Õ `iÀÌ> i ÌÀ> } Ü V >Ã i >L i` ÕÃ Ì V>ÀÀÞ ÕÌ ÕÀ vÕ VÌ > Ài ivwV i Ì manner.

Our committee can report that there is a good working relationship between the BOC, Management, Staff, and Board and we thank them for their co-operation during the year.

Mark Barnes, Alice O’Connell and Anne Bradley.

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REPORT OF THE NOMINATION COMMITTEE The Nomination Committee is a Committee with a statutory role as per section 56B of the Credit Union Act. One of the primary functions of the committee is to ensure that there is at least one candidate nominated for each vacancy at the AGM. The committee has ensured that all candidates and volunteers meet the standards of “Fitness & Probity” set out by the Central Bank of Ireland and have been subjected to due diligence checking and all have agreed, in writing, to abide by these standards should they be elected/re-elected.

There are 2 vacancies for board members due to Ms Phyliss Masterson and Ms Kathleen Kenna stepping down. We are delighted they have both agreed to continue as volunteers for the Credit Committee.

There is 1 vacancy for the Board Oversight Committee as Mr Mark Barnes is retiring. We wish Mark all the best for the future.

On behalf of the Committee, board and members, may I thank all 3 for their service to the credit union.

We have 2 new candidates for the Board Candidates are: Ms Sandra King Mr Desmond Judge There are 2 current board members for re-election: Ms Mary Keville.

Mr Niall Reilly.

Candidate for Board Oversight Committee Mr Vincent Hoban.

Due Diligence has been performed on all nominees.

The Board is proposing Darren Carrick (Partner) of Whelan Dowling & Associates for the position of external auditor for the coming year. / i >Ì V ÌÌii à ÀiµÕ Ài` Ì `iÌiÀ i v Ì Ã Ã>Ì Ãwi` Ì >Ì Ì iÀi à V «iÌi Ì skill-set on the board and that Board members are equipped to contribute and participate in decision making. The Committee’s viewpoint is that this is being done.

Finally, the Committee request any members who are interested in volunteering to contact us. The success of this Credit Union is reliant on volunteers. If you are not interested in being a Director there are a number of committees where volunteers are needed.

Hilda Hyland On behalf of the Nomination Committee.

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DONORE CREDIT UNION ANNUAL REPORT 2020

REPORT OF THE AUDIT RISK AND COMPLIANCE COMMITTEE Dear Member This Committee is responsible for ensuring that the Credit Union complies with all regulatory and legal requirements as per section 76c of the Credit Union handbook and for identifying and monitoring all risks facing the organisation ensuring that both internal and external audits are V `ÕVÌi` > ` > w ` }à > ` ÀiV i `>Ì Ã >Ài « i i Ìi`° Key to ensuring risks are managed is ensuring that processes, checks and balances and suitable µÕ> wi` «À viÃà > à >Ài « >Vi Ì ÌiÃÌ > ` V iV Ì >Ì ÃÞÃÌi à >Ài À LÕÃÌ > ` «iÀ>Ì } «À «iÀ Þ° This Committee oversees the work of the Internal Audit, External Auditor and Risk and Compliance functions to ensure testing programs are completed, tests are conducted, reports and w ` }à >Ài «ÀiÃi Ìi` Ì >À` > ` ÀiV i `>Ì Ã > ` «À Ûi i Ìà >Ài >`i° / i Ƃ,

committee monitors Central Bank of Ireland requests to ensure these are completed on time and on schedule. The ARC committee ensures the credit union is compliant with all legislative and regulatory requirements.

In 2020, the biggest risk facing the Credit Union was Covid-19. Member and staff safety are paramount while at same time maintaining full member services. Through the implementation of our business continuity plan, the oversight of the Crisis Management Team and proactive > >}i i Ì] Þ ÕÀ VÀi` Ì Õ vÕ w i` ̽à > `>Ìi >à > ºiÃÃi Ì > ÃiÀÛ Vi» > ` Ài > i` «i Ü Ì ÕÌ > Þ } ÛiÀ i Ì w > V > ÃÕ«« ÀÌ `ÕÀ } Ì i «> `i V° / i ÌÌii à Ã>Ì Ãwi` Ì >Ì Üi >Ài V « > Ì Ü Ì ÕÀ i}> > ` Ài}Õ >Ì ÀÞ ÀiµÕ Ài i Ìà > ` solid systems of controls are in place.

-i«Ìi LiÀ ÓäÓä] Ì i VÀi` Ì Õ « i i Ìi` > iÜ > >}i i Ì À i º i>` v > Vi > ` ,i}Õ >Ì » Ì vÕÀÌ iÀ ÃÌÀi }Ì i Ì i w > V > > ` Ài}Õ >Ì ÀÞ vÕ VÌ Ã v Ì i VÀi` Ì Õ ° Agnes Heffernan (Director) On behalf of the Audit Risk and Compliance Committee

Donore Credit Union prides itself on being an ethical service provider.

6JCV OGCPU GXGT[FC[ YG YQTM JCTF VQ VTGCV our members with - Honesty - Integrity Fairness - Respect - Competence.

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DONORE CREDIT UNION ANNUAL REPORT 2020

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While the Credit Union had assets of £100 CPF C OGODGTUJKR QH KP KVU ƂTUV [GCT it quickly grew to where it is today, having assets of €38.8 million and a membership of just over 5,000.”

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The Directors present their report and the CWFKVGF ƂPCPEKCN UVCVGOGPVU HQT VJG ƂPCPEKCN year ended 30 September 2020. / i ÀiVÌ ÀÃ «ÀiÃi Ì Ì i À Ài« ÀÌ > ` Ì i >Õ` Ìi` w > V > ÃÌ>Ìi i ÌÃ v À Ì i w > V > Þi>À i `i` 30 September 2020.

OBJECTS The principal activity of Donore Credit Union Limited is the provision of savings and loans to members in its common bond. The Credit Union manages its members’ shares, capital and loans to members so that it earns income from the margin between interest receivable and interest payable. Both the level of business > ` Ì i Þi>À i ` w > V > « Ã Ì ÜiÀi Ã>Ì Ãv>VÌ ÀÞ° / i ÀiVÌ Àà iÝ«iVÌ Ì `iÛi « > ` iÝ«> ` Ì i

Ài` Ì 1 ½Ã VÕÀÀi Ì >VÌ Û Ì ià > ` Ì iÞ >Ài V w`i Ì v Ìà >L ÌÞ Ì «iÀ>Ìi ÃÕVViÃÃvÕ Þ Ì i vÕÌÕÀi° PRINCIPAL RISKS AND UNCERTAINTIES The purpose of the Credit Union is to allow members save together and lend to each other at a fair and reasonable rate of interest. / i «À V «> À à à > ` V > i }ià v>V } Ì Ã Ài` Ì 1 >Ài > `iv>Õ Ì] Ì i ` } > ÃÕvwV i Ì proportion of funds so that too much of the Credit Union’s resources are tied up in investment products > ` Ì i À Ã Ì >Ì Üi Ü Ì >Ûi ÃÕvwV i Ì V>à Àià ÕÀViÃ Ì iiÌ `>Þ Ì `>Þ ÀÕ } V ÃÌà > ` Ài«>Þ members savings when demanded (liquidity risk). These risks are managed by the Credit Union Board so as to achieve an acceptable balance of growth and security for members’ resources. The Board reviews and agrees policies for managing each of these risks which are summarised at note 13.

BUSINESS REVIEW / i ÀiVÌ ÀÃ >V Ü i`}i Ì i ÀiÃÕ ÌÃ v À Ì i Þi>À > ` Ì i Þi>À i ` w > V > « Ã Ì v Ì i

Ài` Ì 1 ° / i ÀiVÌ ÀÃ >Ûi Ìi` Ì >Ì Ì i w > V > «iÀv À > Vi v À Ì i Þi>À Ü>Ã «>VÌi`

by Covid 19. The Board acknowledges the hard work that was committed by all staff in assisting members that were affected by the outbreak by providing Covid-19 Loan arrangements. The full impact of the disruption on the business going forward cannot be reliably measured however the >À` >Ài Ã>Ì Ãwi` Ì >Ì Ì i Ài` Ì 1 Ài« ÀÌi` > ÃÕÀ« ÕÃ Ì i Þi>À° FUTURE DEVELOPMENTS The Directors expect to develop and expand the Credit Unions’ current activities and they are V w`i Ì v ÌÃ >L ÌÞ Ì «iÀ>Ìi ÃÕVViÃÃvÕ Þ Ì i vÕÌÕÀi° DIRECTORS AND BOARD OVERSIGHT COMMITTEE MEMBERS The current Directors and Board Oversight Committee members are as set out on page 11.

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DONORE CREDIT UNION ANNUAL REPORT 2020

AUTHORISATION The Credit Union is authorised to conduct investment business and undertake foreign exchange transactions. It is regulated by the Central Bank of Ireland for these activities.

ACCOUNTING RECORDS The Directors believe that they comply with the requirements of section 108 of the Credit Union Act 1997 (as amended) with regard to books of accounts by employing accounting personnel with >««À «À >Ìi iÝ«iÀÌ Ãi > ` LÞ «À Û ` } >`iµÕ>Ìi Àià ÕÀViÃ Ì Ì i w > V > vÕ VÌ ° / i L à v account of the Credit Union are maintained at the Credit Union’s premises at 22 Rutledge Terrace, South Circular Road, Dublin 8.

POST BALANCE SHEET EVENTS The Board of Donore Credit Union Limited have considered the impact on the organisation of the events subsequent to the balance sheet date, in particular the risks associated with the Covid-19 pandemic which it considered to be a non-adjusting event. The full impact of the Covid 19 disruption cannot be reliably measured at this time and there remains a risk to the Credit Union Ü i Ì i VÕÀÀi Ì w > V > ÃÕ«« ÀÌÃ Li } «À Û `i` LÞ Ì i } ÛiÀ i Ì >Ài Ài Ûi`° ÜiÛiÀ] Ì i Board state that following their review, Donore Credit Union limited have no current going concern issues and expect the Credit Union to remain viable and solvent for the foreseeable future.

AUDITORS / i >Õ` Ì ÀÃ] 7 i > Ü } E ƂÃÃ V >ÌiÃ] >Ûi ` V>Ìi` Ì i À Ü } iÃÃ Ì V Ì Õi vwVi in accordance with Section 115 of the Credit Union Act 1997 (as amended).

Approved by the Board of Directors and signed on its behalf by: Garrett O’Toole Member of the Board of Directors

Agnes Heffernan Member of the Board of Directors

Date: 19th November 2020

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STATEMENT OF DIRECTORS’ RESPONSIBILITIES v À Ì i w > V > Þi>À i `i` Îä -i«Ìi LiÀ ÓäÓä / i Ài` Ì 1 ƂVÌ £ Ç ­>à > i `i`® ÀiµÕ ÀiÃ Ì i ÀiVÌ ÀÃ Ì «Ài«>Ài w > V > ÃÌ>Ìi i Ìà v À i>V w > V > Þi>À Ü V } Ûi > ÌÀÕi > ` v> À Û iÜ v Ì i ÃÌ>Ìi v >vv> Àà v Ì i Ài` Ì 1 > ` v Ì i V i > ` iÝ«i ` ÌÕÀi v Ì i Ài` Ì 1 v À Ì >Ì w > V > Þi>À° «Ài«>À } Ì iÃi w > V > statements the Directors are required to: • select suitable accounting policies and apply them consistently; • make judgements and estimates that are reasonable and prudent; • prepare the financial statements on the going concern basis unless it is inappropriate to presume that the credit union will continue in business. / i ÀiVÌ Àà V wÀ Ì >Ì Ì iÞ >Ûi V « i` Ü Ì Ì i >L Ûi ÀiµÕ Ài i Ìà «Ài«>À } Ì i w > V > ÃÌ>Ìi i Ìð / i ÀiVÌ Àà >Ài Àië à L i v À ii« } «À «iÀ >VV Õ Ì } ÀiV À`Ã Ü V ` ÃV Ãi Ü Ì Ài>à >L i >VVÕÀ>VÞ >Ì > Þ Ì i Ì i w > V > « Ã Ì v Ì i Ài` Ì 1 > ` i >L i Ì i Ì i ÃÕÀi Ì >Ì Ì i w > V > ÃÌ>Ìi i Ìà >Ài «Ài«>Ài` >VV À`> Vi Ü Ì >«« V>L i À à >Ü > ` Generally Accepted Accounting Practice in Ireland, including the standards issued by the Financial Reporting Council, and in particular FRS102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”. They are responsible for safeguarding the assets of the Credit Union and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Approved by the Board of Directors and signed on its behalf by: Garrett O’Toole Member of the Board of Directors

Agnes Heffernan Member of the Board of Directors

Date: 19th November 2020

STATEMENT OF BOARD OVERSIGHT COMMITTEE’S RESPONSIBILITIES

The Credit Union Act 1997 (as amended) requires the appointment of a Board Oversight Committee to assess whether the board of Directors has operated in accordance with Part IV, Part IV (a) and any regulations made for the purposes of Part IV or Part IV(a) of the Credit Union Act 1997 (as amended) and any other matter prescribed by the Central Bank in respect of which they are to have regard in relation to the Board.

Approved on behalf of the Board Oversight Committee Mark Barnes Ann Bradley Member of the Board Oversight Member of the Board Oversight Committee Committee Date: 19th November 2020

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DONORE CREDIT UNION ANNUAL REPORT 2020

INDEPENDENT AUDITOR’S REPORT

to the Members of Donore Credit Union Limited 4GRQTV QP VJG CWFKV QH VJG ƂPCPEKCN UVCVGOGPVU OPINION 7i >Ûi >Õ` Ìi` Ì i w > V > ÃÌ>Ìi i Ìà v Ài Ài` Ì 1 Ìi` v À Ì i w > V > Þi>À ended 30 September 2020 which comprise the Income & Expenditure Account, the Balance Sheet, the Statement of Changes in Reserves, the Statement of Cash Flows and notes to the w > V > ÃÌ>Ìi i ÌÃ] V Õ` } Ì i ÃÕ >ÀÞ v à } wV> Ì >VV Õ Ì } « V ià ÃiÌ ÕÌ Ìi Ó° / i w > V > Ài« ÀÌ } vÀ> iÜ À Ì >Ì >à Lii >«« i` Ì i À «Ài«>À>Ì Ã À à >Ü V Õ` } FRS 102 ‘’The Financial Reporting Standard applicable in the UK and Republic of Ireland’’ and the Credit Union Act 1997 (as amended). ÕÀ « Ì i w > V > ÃÌ>Ìi i ÌÃ\ • give a true and fair view of the state of the assets, liabilities, and financial position of the Credit Union as at 30 September 2020 and of its surplus for the financial year then ended; • have been properly prepared in accordance with FRS 102 ‘’The Financial Reporting Standard applicable in the UK and Republic of Ireland’’; and • have been properly prepared in accordance with the requirements of the Credit Union Act 1997 (as amended).

BASIS FOR OPINION We conducted our audit in accordance with International Standards on Auditing (Ireland) (ISAs (Ireland)) and applicable law. Our responsibilities under those standards are further described in Ì i ƂÕ` Ì À½Ã Àië à L Ì ià v À Ì i >Õ` Ì v Ì i w > V > ÃÌ>Ìi i Ìà ÃiVÌ v ÕÀ Ài« ÀÌ° 7i are independent of the Credit Union in accordance with ethical requirements that are relevant Ì ÕÀ >Õ` Ì v w > V > ÃÌ>Ìi i Ìà Ài > `] V Õ` } Ì i Ì V> -Ì> `>À` ÃÃÕi` LÞ Ì i À à ƂÕ` Ì } > ` ƂVV Õ Ì } -Õ«iÀÛ Ã ÀÞ ƂÕÌ À ÌÞ ­ ƂƂ-Ƃ®] > ` Üi >Ûi vÕ w i` ÕÀ Ì iÀ iÌ V> responsibilities in accordance with these requirements. We believe that the audit evidence we >Ûi LÌ> i` à ÃÕvwV i Ì > ` >««À «À >Ìi Ì «À Û `i > L>à à v À ÕÀ « ° CONCLUSIONS RELATING TO GOING CONCERN We have nothing to report in respect of the following matters in relation to which IAASA require us to report to you where: • the Directors’ use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or • the Directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Credit Union’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

27

OTHER INFORMATION The Directors are responsible for the other information. The other information comprises the v À >Ì V Õ`i` Ì i > Õ> Ài« ÀÌ Ì iÀ Ì > Ì i w > V > ÃÌ>Ìi i Ìà > ` ÕÀ ƂÕ` Ì À½Ã ,i« ÀÌ Ì iÀi ° "ÕÀ « Ì i w > V > ÃÌ>Ìi i Ìà ` iÃ Ì V ÛiÀ Ì i Ì iÀ v À >Ì and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

V iVÌ Ü Ì ÕÀ >Õ` Ì v Ì i w > V > ÃÌ>Ìi i ÌÃ] ÕÀ Àië à L ÌÞ Ã Ì Ài>` Ì i Ì iÀ information and, in doing so, consider whether the other information is materially inconsistent Ü Ì Ì i w > V > ÃÌ>Ìi i Ìà À ÕÀ Ü i`}i LÌ> i` Ì i >Õ` Ì] À Ì iÀÜ Ãi >««i>Àà to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the w > V > ÃÌ>Ìi i Ìà À > >ÌiÀ > ÃÃÌ>Ìi i Ì v Ì i Ì iÀ v À >Ì ° v] L>Ãi` Ì i Ü À Üi have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

OPINIONS ON OTHER MATTERS PRESCRIBED 9 / , / 1 " č /- £ Ç /" Óä£n Based solely on the work undertaken in the course of the audit, we report that: • • •

We have obtained all the information and explanations which we consider necessary for the purposes of our audit.

In our opinion proper accounting records have been kept by the Credit Union.

The financial statements are in agreement with the accounting records.

Respective responsibilities RESPONSIBILITIES OF DIRECTORS FOR THE FINANCIAL STATEMENTS As explained more fully in the Statement of Directors’ Responsibilities as set out on page 16, the

ÀiVÌ Àà >Ài Àië à L i v À Ì i «Ài«>À>Ì v Ì i w > V > ÃÌ>Ìi i Ìà > ` v À Li } Ã>Ì Ãwi` that they give a true and fair view, and for such internal control as they determine is necessary to i >L i Ì i «Ài«>À>Ì v w > V > ÃÌ>Ìi i ÌÃ Ì >Ì >Ài vÀii vÀ >ÌiÀ > ÃÃÌ>Ìi i Ì] Ü iÌ iÀ due to fraud or error. «Ài«>À } Ì i w > V > ÃÌ>Ìi i ÌÃ] Ì i ÀiVÌ Àý >Ài Àië à L i v À >ÃÃiÃà } Ì i Ài` Ì Union’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using going concern basis of accounting unless the Directors either intend to liquidate the Credit Union or to cease operations, or has no realistic alternative but to do so.

AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS "ÕÀ L iVÌ Ûià >Ài Ì LÌ> Ài>à >L i >ÃÃÕÀ> Vi >L ÕÌ Ü iÌ iÀ Ì i w > V > ÃÌ>Ìi i Ìà >à > whole are free from material misstatement, whether due to fraud or error, and to issue an Auditor’s Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (Ireland) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered

28

DONORE CREDIT UNION ANNUAL REPORT 2020

>ÌiÀ > v] ` Û `Õ> Þ À >}}Ài}>Ìi] Ì iÞ V Õ ` Ài>à >L Þ Li iÝ«iVÌi` Ì yÕi Vi Ì i iV V `iV à à v ÕÃiÀà Ì> i Ì i L>à à v Ì iÃi w > V > ÃÌ>Ìi i Ìð Ƃ vÕÀÌ iÀ `iÃVÀ «Ì v ÕÀ Àië à L Ì ià v À Ì i >Õ` Ì v Ì i w > V > ÃÌ>Ìi i Ìà à V>Ìi` Ì i IAASA’s website at: <www.iaasa.ie/getmedia/b2389013-1cf6-458b-9b8f-a98202dc9c3a/Description of auditor’s responsibilities for audit.pdf.> The description forms part of our Auditor’s Report.

THE PURPOSE OF OUR AUDIT WORK AND TO WHOM WE OWE OUR RESPONSIBILITIES Our report is made solely to the Credit Union’s members, as a body, in accordance with section 120 of the Credit Union Act 1997 (as amended). Our audit work has been undertaken so that we might state to the Credit Union’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 Credit Union and the Credit Union’s members, as a body, for our audit work, for this report, or for the opinions we have formed.

WHELAN DOWLING & ASSOCIATES Chartered Accountants and Statutory Audit Firm Block 1, Unit 1 & 4, Northwood Court Santry, Dublin 9 Date: 19th November 2020

“

We have stayed open during the Covid-19 pandemic and have had regular contact with our elderly members during this time to check that everything is okay.”

29

INCOME & EXPENDITURE ACCOUNT v À Ì i w > V > Þi>À i `i` Îä -i«Ìi LiÀ ÓäÓä Notes

2020 €

2019 €

Income Interest on members’ loans Other interest income and similar income Interest payable on members’ deposits

4 5 6

1,017,912 217,515 (6,640)

903,008 395,248 (6,040)

Net interest income Other income

7

1,228,787 84,357

1,292,216 23,247

1,313,144

1,315,463

494,243 641,962 47,625 91,298

461,444 656,220 40,156 (61,550)

1,275,128

1,096,270

Surplus of income over expenditure

38,016

219,193

Total comprehensive income

38,016

219,193

Total income Expenditure Employment costs Other management expenses (Schedule 4) Depreciation Net (recoveries) or losses on loans to members

11.4

Total expenditure

6JG ƂPCPEKCN UVCVGOGPVU YGTG CRRTQXGF CPF CWVJQTKUGF HQT KUUWG D[ VJG $QCTF QH &KTGEVQTU on and signed on its behalf by; David McAuley %JKGH 'ZGEWVKXG 1HƂEGT

Garrett O’Toole Member of the Board of Directors

Mark Barnes Member of the Board Oversight Committee

Date: 19th November 2020

/ Ì> V i v À ÓäÓä

€1,313,144 30

DONORE CREDIT UNION ANNUAL REPORT 2020

BALANCE SHEET >Ã >Ì Îä -i«Ìi LiÀ ÓäÓä Notes

2020 €

2019

5,095,716 398,285 9,799,525 (462,503) 221,850

€

Assets Cash and cash equivalents Property, plant and equipment Loans to members Provision for bad debts Prepayments and other debtors

9 10 11 11 12

2,697,486 394,655 10,667,400 (732,111) 177,671

Deposits and investments

13

25,676,142 21,371,096

Total Assets

38,881,243 36,423,969

Liabilities Members’ shares Members’ deposits Trade creditors and accruals Other creditors

14 15 16 16

Members’ Resources Regulatory Reserve Operational risk reserve Surplus reserve

24,238,174 22,336,172 8,150,299 7,518,593 33,421 62,898 3,319 32,425,213 29,917,663 4,483,000 210,000 1,763,030 6,456,030

Total Liabilities

4,199,912 210,000 2,096,394 6,506,306

38,881,243 36,423,969

Approved by the Board of Directors and signed on its behalf by: David McAuley %JKGH 'ZGEWVKXG 1HƂEGT

Garrett O’Toole Member of the Board of Directors

Mark Barnes Member of the Board Oversight Committee

Date: 19th November 2020

€38.8m Total Assets

6.5% 31

STATEMENT OF CHANGES IN RESERVES v À Ì i w > V > Þi>À i `i` Îä -i«Ìi LiÀ ÓäÓä Regulatory Distribution Operational Reserve reserve risk reserve €

Surplus Unrealised reserve income reserve €

Total

€

€

At 1 October 2018 Dividends paid during Ì i w > V > Þi>À Surplus allocation in w > V > Þi>À Other movement in reserves

4,012,941

-

210,000 2,072,662

€

€

-

(51,811)

-

-

(51,811)

186,971

51,811

-

-

-

238,782

-

-

-

23,732

(43,319)

(19,587)

At 30 September 2019

4,199,912

-

210,000 2,096,394

- 6,506,306

At 1 October 2019 Dividends paid during Ì i w > V > Þi>À Loan interest rebate paid `ÕÀ } Ì i w > V > Þi>À Surplus allocation in w > V > Þi>À Other movement in reserves

4,199,912

-

210,000 2,096,394

- 6,506,306

-

(43,077)

-

At 30 September 2020

43,319 6,338,922

-

(45,216)

(43,077) (45,216)

283,088

88,293

-

-

-

371,381

-

-

-

(333,364)

- (333,364)

4,483,000

-

210,000 1,763,030

- 6,456,030

The Regulatory Reserve of the Credit Union as a % of the total assets as at 30th September 2020 was 11.53% which is more than the Credit Union’s Regulatory Reserve requirement of 10%.

In accordance with section 45 of the Credit Union Act 1997 (as amended) Donore Credit Union Limited put in place an Operational Risk Reserve.

Following the commencement of Section 13 of the 2012 Act, the requirement for Credit Unions to transfer 10% of their annual surplus to their Statutory Reserve (now known as the Regulatory Reserve) each year has been removed. Notwithstanding this the Board of Donore Credit Union Limited has transferred €3,802 of its current year surplus to its regulatory reserve.

Approved by the Board of Directors and signed on its behalf by: David McAuley %JKGH 'ZGEWVKXG 1HƂEGT Date: 19th November 2020

32

Garrett O’Toole Member of the Board of Directors

Mark Barnes Member of the Board Oversight Committee

DONORE CREDIT UNION ANNUAL REPORT 2020

STATEMENT OF CASH FLOWS v À Ì i w > V > Þi>À i `i` Îä -i«Ìi LiÀ ÓäÓä 2020

2019

€

€

5,095,716

3,136,246

4,269,932 (5,181,779) 903,008 (6,640) 209,829 92,043 222,282 (43,077) (45,216) (1,136,205)

3,800,919 (5,777,250) 773,709 (6,040) 395,248 23,247 148,685 (51,811) (1,117,664)

159,083 (26,158)

83,564 (34,803)

(582,898)

(1,762,196)

Purchase of property, plant and equipment iÌ V>Ã y Ü vÀ Ì iÀ ÛiÃÌ } >VÌ Û Ì iÃ

(43,994) (4,305,046)

(22,104) 2,226,572

Net cash (used in)/generated from investing activities %CUJ ƃQYU HTQO ƂPCPEKPI CEVKXKVKGU Members’ shares received Members’ deposits received

(4,349,040)

2,204,468

5,215,612 5,943,020

4,756,099 6,138,960

Members’ shares withdrawn Members’ deposits withdrawn

(3,313,610) (5,311,314)

(3,414,569) (5,963,292)

iÌ V>à }i iÀ>Ìi` vÀ w > V } >VÌ Û Ì ià Net (decrease)/increase in cash and cash equivalents

2,533,708 (2,398,230)

1,517,198 1,959,470

2,697,486

5,095,716

Opening cash and cash equivalents

>à y Üà vÀ «iÀ>Ì } >VÌ Û Ì ià Loans repaid Loans granted Loan interest income Interest paid on members’ deposits Investment income Other income received Bad debts recovered Dividends paid Loan interest rebate Operating expenses Movement in other assets Movement in other liabilities Net cash used in operating activities %CUJ ƃQYU HTQO KPXGUVKPI CEVKXKVKGU

%CUJ CPF ECUJ GSWKXCNGPVU CV GPF QH ƂPCPEKCN [GCT

ARREARS DOWN BAD DEBTS RECOVERED €222K

9

MEMBERSHIP UP BY

33

34

DONORE CREDIT UNION ANNUAL REPORT 2020

“

Be part of an historic Credit Union that combines all the DGPGƂVU QH QNF UV[NG service with modern IT solutions. Donore Credit 7PKQP QHHGTU EQPƂFGPVKCN facilities where members can discuss ƂPCPEKCN OCVVGTU KP C private environment.”

“Donore Credit Union: where members will never be directed to a machine.”

35

Donore Credit Union Limited

NOTES TO THE FINANCIAL STATEMENTS v À Ì i w > V > Þi>À i `i` Îä -i«Ìi LiÀ ÓäÓä 1.

LEGAL AND REGULATORY FRAMEWORK The Credit Union is registered with the Registrar of Credit Unions and is regulated by the Central Bank of Ireland. The registered office of the Credit Union is 22 Rutledge Terrace, South Circular Road, Dublin 8.

2.

ACCOUNTING POLICIES The following principal accounting policies have been applied; STATEMENT OF COMPLIANCE AND BASIS OF PREPARATION These financial statements have been prepared in accordance with FRS 102 (The Financial Reporting Standard applicable in the UK and Republic of Ireland). The financial statements are prepared on the historical cost basis.

CURRENCY The financial statements are prepared in Euro (€), which is the functional currency of the Credit Union. Monetary amounts in these financial statements are rounded to the nearest Euro.

GOING CONCERN After reviewing the Credit Union’s projections, the Directors have reasonable expectation that the Credit Union has adequate resources to continue in operational existence for the foreseeable future. The Credit Union therefore continues to adopt the going concern basis in preparing its financial statements.

INCOME RECOGNITION Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Credit Union and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received. The following criteria must also be met before revenue is recognised: (i) Interest on members’ loans Interest on Member’s loans is recognised on an accruals basis. (ii) Investment income Investment income is recognised on an accruals basis. (iii) Other income Other income such as commissions receivable is recognised on an accrual basis.

36

DONORE CREDIT UNION ANNUAL REPORT 2020

INVESTMENTS Fixed-term deposits Term deposits and fixed interest investment bonds with fixed maturity dates are valued at the lower of cost or encashment value and interest is recognised in the income statement when it is received or irrevocably receivable.

Bonds with guaranteed capital and variable interest rates Interest income is recognised as received. Some bonds pay high rates of interest in early years and lower rates in later years. Paying higher amounts in early years reduces (impairs) the capital value of the bond. The capital value of the bond is tested annually for impairment and impairments losses are taken to the income statement. Impairment gains which reverse a previous impairment loss are taken to the income statement with any gains in excess of the cost of the product ignored until the bond matures.

Held at amortised cost Investments designated on initial recognition as held at amortised cost are measured at amortised cost using the effective interest method less impairment. This means that the investment is measured at the amount paid for the investment, minus any repayments of the principal; plus or minus the cumulative amortisation using the effective interest method of any difference between the amount at initial recognition and the maturity amount, minus, in the case of a financial asset, any reduction for impairment or un-collectability.

Central Bank deposits Credit Unions are obliged to maintain certain deposits with the Central Bank. These deposits are technically assets of the Credit Union but to which the Credit Union has restricted access.

The funds on deposit with the Central Bank attract nominal interest and will not ordinarily be returned to the Credit Union while it is a going concern. The amounts are stated at the amount deposited plus accrued income and are not subject to impairment reviews.

Investments at fair value Investments held for trading and investment in stock market shares (i.e. non-convertible preference shares and non-puttable ordinary shares or preference shares) are included in this category. Financial assets at fair value are classified as held for trading if they are acquired for sale in the short term. They are valued at fair value (market value) at the yearend date and all gains and losses are taken to the income and expenditure account. The fair value of quoted investments is determined by reference to bid prices at the close of business on the balance sheet date. Where there is no active market these assets will be carried at cost less impairment.

PROPERTY, PLANT AND EQUIPMENT AND DEPRECIATION Tangible fixed assets are stated at cost or at valuation, less accumulated depreciation. The charge to depreciation is calculated to write off the original cost or valuation of tangible fixed assets, less their estimated residual value, over their expected useful lives as follows: Land and Buildings freehold

4% Straight Line

Fixtures & Fittings

12.5% Straight Line

Computer Equipment

20% Straight Line 37

IMPAIRMENT OF TANGIBLE FIXED ASSETS At each reporting end date, the Credit Union reviews the carrying value of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Credit Union estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pretax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in the Income and Expenditure account.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply.

Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, subject that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in the Income and Expenditure account.

CASH AND CASH EQUIVALENTS Cash and cash equivalents comprise cash on hand and deposits and investments with a maturity of less than or equal to three months.

BASIC FINANCIAL ASSETS Loans to members Loans are financial assets with fixed or determinable payments. Loans are recognised when cash is advanced to members and measured at amortised cost. Loans are derecognised when the right to receive cash flows from the asset have expired, usually when all amounts outstanding have been repaid by the member.

Bad debt provision The estimation of loan losses is inherently uncertain and depends upon many factors, including loan loss trends, credit risk characteristics in loan classes, local & international economic climates, conditions in various sectors of the economy to which the Credit Union is exposed, and, other factors such as legal & regulatory requirements. Credit risk is identified, assessed and measured through the use of rating and scoring tools with emphasis on weeks in arrears and other observable credit risk metrics. The ratings influence the management of individual loans. The credit rating triggers the impairment assessment and if relevant the raising of specific provisions on individual loans where there is a doubt about their recoverability. Loan loss provisioning is monitored by the Credit Union, and the Credit Union assesses and approved its provisions and provision adequacy on a monthly basis. Key

38

DONORE CREDIT UNION ANNUAL REPORT 2020

assumptions underpinning the Credit Union’s estimates of collective provisions for loans with similar credit risk characteristics, and, Incurred But Not Reported provisions (“IBNR”) are based on the historical experiences of the Credit Union allied to the Credit Union’s judgement of relevant conditions in the wider technological, market, economic or legal environment in which the Credit Union operates. If a loan is impaired, the impairment loss is the difference between the carrying amount of the loan and the present value of the expected cash flows discounted at the asset’s original effective interest rate taking account of the pledged shares and other security as appropriate. Assumptions are back tested with the benefit of experience. After a period of time, when it is concluded that there is no real prospect of recovery of loans/part of loans which have been subjected to a specific provision, the Credit Union writes off that amount of the loan deemed irrecoverable against the specific provision held against the loan.

The bad debt provision at the year-end 30th September 2020 includes provision for the projected future losses arising from members affected by Covid-19 related financial losses.

The total potential loan default due to Covid-19 related losses has been estimated based on a detailed loan book review completed by the Management Team. The Board of Directors have approved the Bad Debt Provision movement.

BASIC FINANCIAL LIABILITIES Members’ shares Members’ shares in Donore Credit Union Limited are redeemable and therefore are classified as financial liabilities. They are recognised at the amount of cash deposited.

Other creditors Short term Other Liabilities, Creditors, Accruals are measured at the transaction price.

Distribution Donore Credit Union Limited’s policy is to pay a reasonable rate of dividend and loan interest rebate subject to covering operating expenses and meeting reserve requirements as set out in the Credit Union’s Reserve Management Policy.

RESERVES Regulatory reserve The Credit Union Act, 1997 (Regulatory Requirements) Regulations 2016 requires Credit Unions to establish and maintain a minimum Regulatory Reserve requirement of at least 10 per cent of the assets of the Credit Union. This Reserve is to be perpetual in nature, freely available to absorb losses, realised financial reserves that are unrestricted and nondistributable.

Operational risk reserve Section 45(5)(a) of the Credit Union Act, 1997 (as amended) requires each Credit Union to maintain an additional reserve that it has assessed is required for operational risk having regard to the nature, scale and complexity of the Credit Union. Credit Unions are required to maintain a minimum operational risk reserve having due regard for the sophistication of the business model.

39

The definition of operational risk is the risk of losses stemming from inadequate or failed internal processes, people and systems or from external events. The Directors have considered the requirements of the Act and have considered an approach to the calculation of the operational risk reserve.

Other reserves Other Reserves are the accumulated surpluses to date and Reserves arising that have not been declared as dividends returnable to members. The Other Reserves are subdivided into realised and unrealised. In accordance with the Central Bank Guidance Note for Credit Unions on Matters Relating to Accounting for Investments and Distribution Policy, investment income that has been recognised but will not be received within 12 months of the balance sheet date is classified as “unrealised” and is not distributable. A reclassification between unrealised and realised is made as investments come to within 12 months of maturity date. Interest on Loans receivable at the balance sheet date is also classified as “unrealised” and is not distributable.

All other income is classified as “realised”.

DISTRIBUTION POLICY In respect of each financial year, the Credit Union will allocate surplus funds to the statutory reserve and other reserves in accordance with the provisions of the Credit Union Act 1997 (as amended) and regulations issued by the Registry of Credit Unions, Central Bank of Ireland.

The Board of Directors may also decide to hold reserves in excess of minimum statutory requirements, taking prudent account of the scale and complexity of the Credit Union’s business, its risk profile and prevailing market conditions. The basis of the dividend is the distributable income of the Credit Union after meeting its reserve requirements. It is the policy of the Credit Union to maintain the undistributed surplus in a general reserve that may be used in future years for the payment of dividends.

3.

CRITICAL ACCOUNTING JUDGEMENT AND ESTIMATES Preparation of the financial statements requires management to make significant judgements and estimates. The items in the financial statements where these judgements and estimates have been made include: Determination of depreciation , useful economic life and residual value of tangible assets The annual depreciation charge depends primarily on the estimated lives of each type of asset and, in certain circumstances, estimates of residual values. The directors regularly review these useful lives and change them if necessary to reflect current conditions. In determining these useful lives, management consider technological change, patterns of consumption, physical condition and expected economic utilisation of the assets. Changes in the useful lives can have a significant impact on the depreciation charge for the financial statements.

40

DONORE CREDIT UNION ANNUAL REPORT 2020

Impairment of buildings At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any affected asset is eliminated and compared with its carrying amount. If the estimates recoverable amount is lower, the carrying value is reduced to its estimated recoverable amount, an impairment loss is recognised immediately in profit or loss. If an impairment loss subsequently reverses, the carry amount of the asset is increased to the revised estimate of the recoverable amount, but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment is recognised immediately in the Income and Expenditure Account.

Bad Debt Provision Donore Credit Unions accounting policy for impairment of loans is set out in the accounting policies. The estimation of loan losses is inherently uncertain and depends upon many factors, including loan loss trends, credit risk characteristics in loan classes, local and international economic climates, conditions in various sectors of the economy to which the credit union is exposed, and, other external factors such as legal and regulatory requirements.

4.

INTEREST ON MEMBERS’ LOANS 2020 € Closing accrued interest receivable > ÌiÀiÃÌ ÀiVi Ûi` w > V > Þi>À Opening accrued loan interest receivable

5.

1,017,912 903,008 (903,008) 1,017,912

2019 € 903,008 773,709 (773,709) 903,008

OTHER INTEREST INCOME AND SIMILAR INCOME 2020 € Investment income received Investment income receivable within 12 months -ÕÀ« ÕÃ É ­`iwV Ì® Ã> i v «iÀ«iÌÕ> L `Ã

58,301 151,528 7,686 217,515

2019 € 203,738 191,510 395,248

6k in donations

and sponsorship to local groups

41

6.

INTEREST PAYABLE AND DIVIDENDS 2020 € 6,640

ÌiÀiÃÌ «>Þ>L i `i« Ã ÌÃ v À Ì i w > V > Þi>À

2019 € 6,040

Dividends and loan interest rebate / i v Ü } ` ÃÌÀ LÕÌ Ã ÜiÀi >`i `ÕÀ } Ì i w > V > Þi>À\ 2019 % 0.25 -

Dividends on shares Loan interest rebate

2019 € 51,811 51,811

The above dividends refer to those paid out in those years from the surplus earned in previous years.

Proposed dividends and loan interest rebate No proposed dividend or loan interest rebate is recognised in these financial statements, which is in accordance with the relevant accounting policy.

The proposed distribution is as follows:

Dividends on shares Loan interest rebate

7.

2020 % -

2020 € -

2019 % 0.20 5.00

2019 € 43,077 45,516 88,293

OTHER INCOME 2020 € Other Income Entrance fees Grants received

9 Loan Products 42

63,710 207 20,440 84,357

2019 € 22,978 269 23,247

DONORE CREDIT UNION ANNUAL REPORT 2020

n° 9 č č / * ,-"

The Directors of Donore Credit Union Limited are all unpaid volunteers. The management personnel compensation is as follows: 2020 € 181,000 13,489 194,489

- ÀÌ ÌiÀ i « Þii Li iwÌÃ Payments to pension scheme Total key management personnel compensation

2019 € 128,360 8,131 136,491

Short term employee benefits include salaries, social security contributions and paid annual leave.

9.

CASH AND CASH EQUIVALENTS Cash and cash equivalents comprise of cash on hand and deposits and investments with a maturity of less than or equal to three months.

2020 € Cash and bank balances Cash equivalents

1,211,318 1,486,168 2,697,486

2019 € 812,541 4,283,175 5,095,716

10. PROPERTY, PLANT AND EQUIPMENT Land and buildings freehold €

Fixtures, ƂVVKPIU CPF equipment €

Total

608,384 608,384

179,142 43,994 (6,878) 216,258

787,526 43,994 (6,878) 824,642

Depreciation At 1 October 2019

>À}i v À Ì i w > V > Þi>À On disposals At 30 September 2020

283,950 10,491 294,441

105,291 37,133 (6,878) 135,546

389,241 47,624 (6,878) 429,987

Net book value At 30 September 2020 At 30 September 2019

313,943 324,434

80,712 73,851

394,655 398,285

Cost At 1 October 2019 Additions Disposals At 30 September 2020

€

43

11. LOANS TO MEMBERS - FINANCIAL ASSETS 11.1 LOANS TO MEMBERS Notes As at 1 October 2019 Ƃ`Û> Vi` `ÕÀ } Ì i w > V > Þi>À ,i«> ` `ÕÀ } Ì i w > V > Þi>À Loans written off Gross loans to members

2020 €

2019 € 7,836,866 5,777,250 (3,800,919) (13,672) 9,799,525

9,799,525 5,181,779 (4,269,932) (43,972) 10,667,400

11.2

11.2 CREDIT RISK DISCLOSURES 2020

2020

2019

2019

%

€

9,426,344

88.36 9,153,642

93.41

884,096 121,813 130,382 60,336 32,066 12,363 1,241,056 10,667,400

8.29 509,253 1.14 61,455 1.22 0.57 48,616 0.30 0.12 26,559 11.64 645,883 100.00 9,799,525

5.20 0.63 0.50 0.26 6.59 100.00

10,667,400

9,799,525

% Gross loans not impaired Not past due Gross loans individually impaired Up to 9 weeks past due Between 10 and 18 weeks past due Between 19 and 26 weeks past due Between 27 and 39 weeks past due Between 40 and 52 weeks past due 53 or more weeks past due Total Total gross loans Impairment allowance Total carrying value

€|

Factors that are considered in determining whether loans are impaired are discussed in note 2, dealing with the use of estimates and judgements. Loans which are neither past due nor impaired are reviewed on a monthly basis. The Credit Union has not identified any material matters which impact upon the credit quality of these assets.

During the year PGY OGODGTU LQKPGF 44

DONORE CREDIT UNION ANNUAL REPORT 2020

11.3 LOAN PROVISION ACCOUNT FOR IMPAIRMENT LOSSES 2020 € As at 1 October Allowances reversed during the year Increase/(Decrease) in loan provision during the year As at 30 September

462,503 269,608 269,608 732,111

2019 € 389,042 73,461 73,461 462,503

11.4 NET RECOVERIES OR LOSSES RECOGNISED FOR THE FINANCIAL YEAR 2020 € Bad debts recovered Increase in provision Loans written off Net (recoveries)/losses on loans to members recognised for the w > V > Þi>À

2019

(222,282) 269,608 47,326 43,972

€ (148,685) 73,461 (75,224) 13,674

91,298

(61,550)

2019 Number of loans

2019 €

101 726 629 72 6 1,534

99,803 2,388,906 5,257,726 1,715,780 337,251 9,799,466

2020 €

2019

11.5 ANALYSIS OF GROSS LOANS OUTSTANDING 2020 Number of loans Less than one year Greater than 1 year and less than 3 years Greater than 3 years and less than 5 years Greater than 5 years and less than 10 years Greater than 10 years and less than 25 years

2020 €|

112 96,653 698 2,325,712 642 5,610,902 86 2,359,099 5 275,034 1,543 10,667,400

12. DEBTORS, PREPAYMENTS AND ACCRUED INCOME

Other debtors Prepayments Accrued income

2,000 24,143 151,528 177,671

€ 8,766 21,574 191,510 221,850

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13. DEPOSITS AND INVESTMENTS

Fixed-term deposits Bank Bonds

2020 €

2019

2020 €

2019

2020 €

2019

2020 €

2019

€ 23,176,142 15,371,096 2,500,000 6,000,000 25,676,142 21,371,096

14. MEMBERS’ SHARES - FINANCIAL LIABILITIES

As at 1 October 2019 ,iVi Ûi` `ÕÀ } Ì i w > V > Þi>À ,i«> ` `ÕÀ } Ì i w > V > Þi>À As at 30 September 2020

€ 22,336,172 20,994,642 5,215,612 4,756,099 (3,313,610) (3,414,569) 24,238,174 22,336,172

15. MEMBERS’ DEPOSITS - FINANCIAL LIABILITIES

As at 1 October 2019 ,iVi Ûi` `ÕÀ } Ì i w > V > Þi>À ,i«> ` `ÕÀ } Ì i w > V > Þi>À As at 30 September 2020

€ 7,518,593 7,342,925 5,943,020 6,138,960 (5,311,314) (5,963,292) 8,150,299 7,518,593

16. OTHER CREDITORS AND ACCRUALS

PAYE/PRSI Accruals

3,319 33,421 36,740

€ 62,898 62,898

Donore Credit Union now participate in a Defined Contribution Scheme with rates of 5% to 9% employer contributions made.

17. FINANCIAL INSTRUMENTS Donore Credit Union Limited manages its members’ shares and loans so that it earns income from the margin between interest receivable and interest payable. The main financial risks arising from Donore Credit Union Limited’s activities are credit risk, market risk, liquidity risk and interest rate risk. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

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DONORE CREDIT UNION ANNUAL REPORT 2020

Financial assets at amortised cost Financial liabilities Financial liabilities at amortised cost

2020 2019 € € 38,310,917 36,459,828 32,432,443 29,917,663

Credit Risk: Credit risk is the risk that a borrower will default on their contractual obligations relating to repayments to Donore Credit Union Limited, resulting in financial loss to the Credit Union.

In order to manage this risk the Board of Directors approves Donore Credit Union Limited’s lending policy, and all changes to it. All loan applications are assessed with reference to the lending policy in force at the time. Subsequently loans are regularly reviewed for any factors that may indicate that the likelihood of repayment has changed. During the financial year ended 30 September 2020 the credit risk profile of the credit union was impacted by the effects of Covid-19 on the general membership. The Credit Union implemented Temporary Covid Loan Arrangements with affected members and increased monitoring and oversight of loans on a risk based approach. The change in risk profile was reflected in the increase to the bad debt provisions at the year end Liquidity Risk: Donore Credit Union Limited’s policy is to maintain sufficient funds in liquid form at all times to ensure that it can meet its liabilities as they fall due. The objective of the Credit Union’s liquidity policy is to smooth the mismatches between maturing assets and liabilities and to provide a degree of protection against any unexpected developments that may arise.

Market Risk: Market risk is generally comprised of interest rate risk, currency risk and other price risk.

Donore Credit Union Limited conducts all its transactions in Euro and does not deal in derivatives or commodity markets. Therefore Donore Credit Union Limited is not exposed to any form of currency risk or other price risk.

17.1 LIQUIDITY RISK DISCLOSURE All of the financial liabilities of the Credit Union are repayable on demand except for some members’ shares attached to loans. £n° , č/ *č,/9 /,č -č / " The Related Party Loans stated above comprise of loans to members of the Board of Directors, the Board Oversight Committee, the Management Team and members of the family of member of the Board of Directors and the Board Oversight Committee and the Management team of Donore Credit Union Limited. Related parties have been identified in line with the definition in the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016.

Total Loans outstanding to Related Parties represents 2.87% of the total loans outstanding at year ended 30 September 2020

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Loans advanced to Related Parties during the year 6QVCN NQCPU QWVUVCPFKPI VQ 4GNCVGF 2CTVKGU CV VJG ƂPCPEKCN [GCT GPF

No. of loans

2020 €

14 16

141,200 306,439

There were no provisions against the loans due from the Directors and the Management Team at the current or prior year Balance Sheet Date.

There were no other related party transaction identified in the period under review. Óä° -1,č č č -/ ,č1

The Credit Union has insurance against fraud in the amount of €2,600,000 in compliance with section 47 of the Credit Union Act, 1997 (as amended).

21. CAPITAL COMMITMENTS The Credit Union had no material capital commitments at the financial year-ended 30 September 2020.

22. POST-BALANCE SHEET EVENTS There have been no known events affecting the Credit Union since the year end which would require adjustment or disclosure in the financial statements.

The Board of Donore Credit Union Limited have considered the impact on the organisation of the events subsequent to the balance sheet date, In particular the risks associated with Covid 19 pandemic which it considered to be a non-adjusting event. The full impact of the Covid 19 disruption cannot be reliably measured at this time and there remains a risk to the Credit Union when the current financial supports being provided by the government are removed however, the Board state that following their review Donore Credit Union have no current going concern issues and expect the Credit Union to remain viable and solvent for the foreseeable future.

23. ETHICAL STANDARD FOR AUDITORS (IRELAND)ISSUED BY IAASA In common with many other Credit Unions, from time to time, our auditors provide us with advisory and consulting services.

24. PENSION SCHEME Donore Credit Union Limited participate in a Defined Contribution Scheme with rates of 5% to 9% employer contributions made.

25. APPROVAL OF FINANCIAL STATEMENTS The financial statements were approved, and authorised for issue, by the Board of Directors on .

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DONORE CREDIT UNION ANNUAL REPORT 2020

SCHEDULES TO THE INCOME & EXPENDITURE ACCOUNT v À Ì i w > V > Þi>À i `i` Îä -i«Ìi LiÀ ÓäÓä SCHEDULE 1 - INTEREST ON LOANS

Interest on Loans Interest on members’ loans receivable

SCHEDULE 2 - INVESTMENT INCOME

Investment Income Investment Income Investment income receivable within 12 months

Surplus on sale of perpetual bonds

SCHEDULE 3 - OTHER REVENUE

Other Revenue Other Income Entrance fees

Grants received

2020 €

2019

1,017,912 1,017,912

903,008 903,008

2020 €

2019

58,301

203,738

7,686 217,515

395,248

2020 €

2019

63,710 207 20,440 84,357

22,978 269 23,247

151,528

home do improvement with Great Rates on Large Loans

€

€

191,510

€

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SCHEDULE 4 - OTHER MANAGEMENT EXPENSES

Other Management Expenses Training Rent & Rates Share & Loan Insurance General insurance

i>Ì i iwÌ ÃÕÀ> Vi Central Bank Levies Light, heat and cleaning Repairs & Renewals Chapter expenses Printing and stationery Promotion and Advertising Telephone and postage Computer & Equipment Maintenance Travelling and subsistence AGM & Convention Legal and professional Subscriptions and donations Consultancy fees Outsourced Payroll costs Organisational & Financial Review costs Audit Bank interest and charges Security BOC Expenses General expenses Debt Collection Ƃvw >Ì viiÃ

2020 €

2019 €

11,028 9,957 133,055 15,831 58,943 75,934 21,583 5,731 5,595 31,159 9,331 79,061 5,067 10,221 10,161 5,780 61,302 2,352 16,055 17,972 5,439 3,369 17,674 21,365 7,997 641,962

12,303 10,685 123,199 14,341 58,431 44,626 21,014 18,813 389 6,679 34,787 8,724 64,459 6,345 13,481 24,313 4,575 72,385 9,409 23,288 17,251 18,157 5,927 1,509 16,499 17,543 7,088 656,220

DONORE ON-LINE BANKING Sign up through our website, it is simple and straight forward.

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DONORE CREDIT UNION č ANNUAL 1č , *",/ ÓäÓä REPORT 2020

Donore Credit Union makes a social impact Donore Credit Union is not a profit or cost centre, this remains and always will be a people centre.

With Donore’s help, I have gotten far better at saving. It’s opened my eyes: a little goes a long way.

We would be lost without the credit union. We know them so well. They’re just always there, always helpful.

If I lost my job or became ill for any reason I feel the credit union would be understanding and rearrange my loans and budget account to help me get through the short term situation this is very comforting for my mental health.

They offer us a huge degree of comfort, as we know they care about the social impact of what we do, not just the money side of things.

It’s great to walk into a financial institution where all staff know you by name.

Long may Donore Credit Union last.

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DONORE CREDIT UNION ANNUAL REPORT 2020

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Ireland’s First Credit Union is also

Dublin’s Fastest Growing Credit Union

Donore Credit Union 22 Rutledge Terrace South Circular Road Dublin 8 01 453 0844 info@donorecu.ie

www.donorecu.ie donorecu.ie

The Independent Credit Union of the Liberties