Treasurer’s Report

Financial Year 2021 – April 2020– March 2021 (FY20/21)

The Singapore Gymnastics Treasurer’s annual report is intended to summarise and comment on the financial position of Singapore Gymnastics and other related matters. It should be read together with the audited accounts for the year ended 31 March 2021. As well as a commentary on audited historic information, a summary of the SG budget for the year ended 31 March 2022 is included below, in order to provide members with information about the planned future direction of SG and as a basis for approval of the audited accounts at the General Meeting.

Singapore Gymnastics’ financial result for the financial year 2021 (Period: April 2020 to March 2021) was an operating surplus of $158,300, against a planned operating surplus of $27,305 at the beginning of the year. The increase in the surplus compared to budget revolved around several factors:

SG’s initial SportSG grant funding allocation of $2,681,600 saw an increase of 8.4% attributed to increase funds towards national office headcount, high performance head count and gymnastics equipment. Due to the impact of the Covid situation, SG’s utilisation of overall grant funding for the FY was decreased compared to last financial year of $423,150. The decrease in SportSG funding usage can be contributed to:

An increase in what was budgeted for in the government Jobs Support Scheme (JSS) of $14,010, Increase in net income of $17,500 due to the receiver of the WorkPro grant funding applied for in 2018, Decrease of $62,332 in the allowance for bad debts due to the reduction of the overdue debtor balance for the financial year as of 31 March 2021, Increase in the net income budgeted for educational activities of $10,214, Increase in the net income of membership compared to budget of $7,090. Decrease in National Training Centre overheads of $48,485.

Decrease in venue and office rental of $93,887 due to Covid-19 and the inability to utilise venues during Circuit Breaker, Reduction in the use of Enhanced High-Performance funding of $186,672 due to the inability to appoint a replacement of a WAG Head Coach and Athlete Health Performance Manager due to Covid and the difficulty of bringing in overseas talent. The inability to utilise the $85,000 received for overseas international competition. The roll over of $72,000 for sports equipment that will be received in the following financial year.

Income

There was an overall decrease of total income (which excludes SportSG funding) of $368,711 or 34% from the previous financial year due to Covid-19 situation. (e.g., no Singapore Open).

While there was an increase in government funding from JSS and WorkPro totalling $90,204 and membership income of $28,266 in FY20/21, the lack of activities due to Covid-19 impacted the overall income generated.

While the National Championships were conducted in March 2021, there was a 37% decrease in total event income compared to FY19/20. Income was received for the live streaming of the National Championships but unfortunately the income did not cover the entire cost to live stream to the community. Even with the lack of spectator income, through frugal management of expenses and increased participation, the National Championships had a surplus of $22,000.

With no activity in the financial year around overseas travel for the National Team, this decreased the total income in FY20/21 by $194,404.

There was a decline in National Training Centre income of 25% due to the inability to increase athlete numbers owing to the training restrictions imposed by the government, safe management measures and the discount to the training fees in the first quarter due to the

Circuit Breaker.

There was once again a conscious effort towards managing overhead expenditure during the financial year, as once again there was an inability to conduct a major fundraising event and achieve the $40,000 fundraising budget target for FY20/21. Expenses in FY20/21 decreased 28.41% from $3,414,522 to $2,443,656, with the decline in expenditure directly related to the decline in income due to the inability to conduct events and activities because of Covid-19. There was a slight increase in staff costs of 9% which was due to the increase in staff annual leave balances due to Covid-19. There was a 41.4% decrease in the general operating expenses which related to what has been previously mentioned, the decrease in the allowance for bad debts of $59,031 and office rental of $39,074.

There was a substantial decrease in debtors in FY20/21 of 50.2%. The National Office continued the work on reducing the debtors from $124,790 to $61,954, with the balance being the lowest since FY15/16. The debt ratio of total income, excluding SportSG grant funding, to debtors decreased by 6% in the financial year.

Expenses

Debtors

Reserves

The reserves for the organisation at the end of the FY, increased by $158,300 to have a closing balance of $433,860 at the end of March 2021. As per the Reserves Policy, $47,490 has been allocated to restricted reserves with the restricted reserves balance at $97,490. The

Board aims to provide stability to fund the structural costs of SG with the long term aim to build the reserves to $500,000 or approximately equivalent of one year of salaries.

SG will continue to work towards increasing the reserves and improving the association's

Sustainability Index (Total Revenue - SportSG Grant / Annual operating Expenditure) and the

Reserve Ratio (Unrestricted Reserves/Annual Operating Expenditure). The trends of both the index and ratio continue to move positively. Currently the sustainability index is at 0.30, a decrease from 0.32 and the Reserve Ratio is at 13.8% compared to 6.6% at the year end of the previous year.

In the preparation of the FY21/22 with a budget deficit of $18,089, attention was given to ensuring there was no substantial impact on the reserves by continuing to manage the overall operating expenses. The budget has been prepared taking into consideration that no Singapore Open will be conducted in 2021, reduction in govt covid19 grants but anticipating that the 2022 National Championships will be held with a positive financial impact as per the previous financial year. The organisation will continue to focus on looking for ways to incentivise and grow membership with proactive push-pull strategies that are linked to increasing SG’s value proposition to the community. Increasing the membership value proposition, by increasing more event opportunities even in the current Covid-19 environment, will be a key to increasing membership income for FY21/22. SG forecasts an increase in the total membership from 1,239 to 1,756, which would see an increase in membership income of approximately $20,000. SG will continue to deliver a strong education programme to ensure sustainability of the sport in Singapore, recognising that coaches are the key drivers in increasing participation across the nation. This area of the organisation and in particular the fundamental coaches’ courses, will continue to assist in the development of additional revenue streams. With the increase in membership and quality activities being offered, SG will start to actively engage with potential sponsors to increase the income and ensure continued viability of the organisation. The Fundraising and PR target for FY21/22 is $70,000.

The Financial Forecast for FY21/22

The Board is actively looking to attract ongoing patrons to financially support the organisation with a target of 4 sponsors attributing to $50,000, including One Team Singapore Funding (OTSF) in the upcoming financial year.

There is a draft plan to conduct a fund-raising activity in FY21/22 to leverage off the Annual Awards Dinner. The exact details are still to be finalised and there are risks due to the continued restriction and impact domestically and globally of Covid-19. The Fundraising and PR Committee are looking for alternative fundraising solutions and initiatives that could drive donations, as well as other government schemes that SG could leverage off with fundraising activities. The budgeted amount can be found below.

List of fund-raising activities

Annual Awards Dinner (NO OTSF) Donor Patrons (With OTSF)

Expected income

$30,000 $50,000

Expected expenditure

$10,000

In 2020, as mentioned in the 2019 Annual Report, SG undertook a Compliance Audit for the financial period from 1 April 2018 to 31 March 2019. The final report signed off in May 2020 identified nine issues which the Board have continued to address and action throughout the year:

Reviewing and updating the Financial & Management Delegation Policy and the Financial Standard Operating Procedures (SOP). The formation of a Governance Sub-Committee which will take on the role of a "Nominations Sub-Committee" and will undertake the responsibility to design methodologies and checklists to evaluate and measure the performance and effectiveness of the Board. Adoption of a Board Governance Policy. The Board undertaking the Pulse Check assessment with the Centre For Non-Profit Leadership (CNPL) and working through the recommendations The Directors actively attend workshops on governance, board performance and selfevaluation over their tenure. Adoption of a Volunteer Management Policy

In February 2021 a follow up of the Compliance audit was conducted by the Auditor KLP where it was reported that 6 of the 9 issues originally identified in the Compliance Audit were deemed to have been resolved by the Auditor. The remaining three identified risks, listed below, have been partially resolved with a process review and update of management procedures. The outstanding areas are dependent on financial activities that were not conducted during the financial year due to Covid-19 situation.

Management of spectator income.

Management of contingency funds for National team overseas travel.

Management of petty cash.

The resolution of these three risks will be reviewed by the Auditor in June 2022.

In the endeavour to ensure best practise and for the Board to fulfil their fiduciary duties, the Audit and Risk Sub-Committee liaised and consulted with the Auditor KLP around an internal review into the Financial SOP, the Financial Management and Delegation Policy that outlines the procurement process and the Debtors Policy. The objectives of the review were to ensure sufficient controls, policies and procedures are in place to address any potential lapses and to provide findings and recommendations to the Sub-Committee.

The Independent Review Report on Policies and Standard Operating Procedures (SOP) has been finalised. From the findings, all recommendations highlighted within the report have now been adopted into the respective policies and SOP to ensure the continued improvement in the current policies and procedures.

Mr. Stephen Lim SL, Singapore Gymnastics Treasurer

The Board aims to provide stability to fund the structural costs of SG with the long term aim to build the reserves to $500,000 or approximately equivalent of one year of salaries.