The International Correspondence Chess Federation 2014 Congress Sydney, Australia Table of Contents

Auditor Report

I set the level of materiality at EUR 17.00, which is the usual limit from which receipts are required for a cost reimbursement.

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  I checked if all ledger accounts had been opened by correct opening balances, equalling to closing balances as at 31^st December 2012.
  
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  I checked the formal correctness of all book entries made on various ledger accounts during the year 2013.
  
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  I checked if the closing balances of ledger accounts as at 31^st December 2013 had been allocated correctly to particular items of the Balance Sheet and the Profit & Loss Statement.
  
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  I compared the issued MF’s Statements of Accounts for the year 2013 with the respective book entries.
  
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  In a detailed way, I analysed the accounts receivables and accounts payables as at 31^st December 2013.
  
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  I checked the vouchers and bank statements provided by the Finance Director and compared them with the respective book entries in the Day Book.
  

The discovered discrepancies were submitted to the Finance Director, together with my proposals how these should be rectified. I am pleased to report that all my proposals were welcomed and accepted by the Finance Director, and that appropriate adjustments were made in the final version of the Financial Statements.

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  Based on my recommendation from the year 2013, the ICCF Finance Director amended the annual Member Federations Statement of Accounts by introducing a new template, which is now in compliance with the definitions stated in the Articles 6 and 7 of the Statutes.
  
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  Just as in my Auditor’s Report for the year 2010, I recommended general reductions to ICCF’s annual surpluses and the utilization of the funds accumulated from previous years for the benefit of ICCF players. In 2013, the ICCF Finance Director made other provisions for future prizes and herewith reduced the reported yearly income. Rebates for DE entries were considerably higher than in 2012 – probably, Member Federations are encouraging players to use Direct Entry in order to obtain more rebates.
  
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  Nevertheless, given the high income from the World Cup 20, the yearly profit was even higher than in 2012, namely by 11.75 %. On the other side, and as I stressed in my Report in Cracow, non-profit organizations should not make too high profits. In this respect, my recommendation from 2010 to reduce yearly profits remains in power.
  
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  Because of the abovementioned increased Direct Entry rebates, many Member Federations just have a “credit” towards ICCF. The total credit in the year 2013 was as high as 2.5 thousands euro. The ICCF Finance Director always deducts these credits from the next Statement, which is correct in terms of the business between ICCF and Member Federations. However, regarding the formal layout of the Financial Statements, the International Financial Reporting Standards do not allow offsets between accounts receivable and accounts payable when the debtors and creditors are different subjects, which is exactly ICCF’s case. For that reason, I recommended to report the credits as ICCF’s liabilities and not to deduct them from the accounts receivable. This recommendation was accepted by the ICCF Finance Director.
  
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  Again, the payment culture of Member Federations improved in 2013 and the ICCF Finance Director did not have to impose any interest surcharges for late payments in the last year.
  
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  The bad debt of Algeria amounting to € 266.04 had to be written off in 2013, also two minor debts of Malta and Turkmenistan. The total amount of the written-off debts is € 333.04. No new allowances for bad debts needed to be created in the financial year 2013.
  
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  Again, there was a positive development in the market value of the ICCF investments which increased during the year by € 4 984.72, much more than in 2013.
  
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  The ICCF’s cash position remains strong and sound. The net cash balance of ICCF increased during the year by 6.4 % and amounted to more than € 220 thousand at the end of 2013. However, I have to stress that a part of these funds belongs to the Zone 1, as the Zone 1 Member Federations were allowed to pay for their ICCF and Zone 1 Statements by one payment to the ICCF bank account.
  

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  Apart from my still valid proposal to continue reducing the yearly profits as expressed above, I have no other recommendations and proposals. In my opinion, the financial year 2014 will be critical for further financial decisions, as this will be the first year, which will show the impact of the reduction of start fees as from 1.1.2014 on the ICCF’s income and profit. If the trend of increasing profits continued, ICCF probably should think of a further reduction of fees.
  

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  Other than this I should only like to add that ICCF’s finances continue to enjoy a healthy condition and that I do not foresee at this time any possibility of a substantial financial deficit for the year 2015 and subsequent years.
  

AMICI SUMUS!

31^st July, 2014

Josef Mrkvička

Houškova 32

326 00 Plzeň, Czech Republic

Financial statements of ICCF as of December 31, 2013 (Balance Sheet, Profit & Loss Account) – attached to the Finance Director’s Report