2009/10 has seen significant changes in the operations of RNIB which are reflected in the financial results for the year.
These changes have seen underlying income rise to £117.4million and spending on charitable activities rise to £111.1million.
Impact of associations
Key to these changes were the associations formed with Action for Blind People, Cardiff Institute for the Blind (to become Cardiff, Vales and Valleys) and National Talking Newspapers and Magazines (NTNM).
These charities have brought income of £13.8million and charitable activities of £13.1million to the Group. On consolidation they have contributed £17.7million by way of net assets, at fair value, to the Group.
New strategy
In 2008/9 we announced the new RNIB Group strategy based around three aims:
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prevention of sight loss
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supporting independent living
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creating an inclusive society.
The Group Statement of Financial Activities (SOFA) has been changed to reflect this new strategy and the previous year's figures restated accordingly.
The total income and expenditure on charitable activities have not changed in this restatement.
Fundraising income
We are very pleased to see that our fundraising income has held up in the current economic climate.
Whilst the enlargement of the Group has played a significant part of this, when looking at the underlying level of fundraising in the Charity, excluding Group companies it has increased from £54million to £57.2million due to an exceptionally strong year for legacy income.
Significant financial activity
As well as the above, other significant activity during the year was:
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The continued construction of our new Rushton School and Children's Home in Coventry. Construction work cost £6.3million during the year and the school and living accommodation will be operational in January 2011. The construction costs are covered by fundraised income and a bank loan from Allied Irish Bank (AIB).
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Significant uses of designated funds have included £280,000 starting eye clinic services in Northern Ireland, £900,000 on improving our website, £400,000 getting large print books into high street bookshops, £500,000 on "Work Focus" employment project, and £335,000 making digital TV more accessible to blind and partially sighted people.
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Increasing our influence on the international stage.
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Strengthening awareness of sight loss issues through the launch of our "Lost and found" campaign.
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The value of our investments increased by £6.9m as world stock markets recovered during the year.
Reductions
Free reserves at the end of the year stood at £19.1million, which is equivalent to 11 weeks as compared to £21.8million (13 weeks) at 31 March 2009. This is part of a planned reduction in our reserves to support our projects and services during this difficult economic period. The reduction during the year would have been greater if the value of our investments hadn't increased by £6.9million.
Work on a number of projects progressed with support from the Investment Fund. Work continued on RNIB Rushton School and Children's Home with funds from the revenue shortfall reserve. These funds reduced by £3.9million to £8.2million during the year.
This reduction is planned to continue further in 2010/11.
Pension scheme
Whilst the improvements to world stock markets had a material effect on the value of the RNIB pension scheme assets, a combination of lower yields on AA rated corporate bonds, increases in the long-term outlook for inflation and in the future improvements in longevity has led to a small increase in the FRS17 valuation of the pension fund deficit from £8.1million to £9.2million.
The last formal triennial valuation of the pension scheme was at 31 March 2009. The valuation disclosed that the market value of the Scheme's assets (excluding voluntary contributions) at that date was £93.3million, and that there was a deficit of £28.6 million.
RNIB has agreed a recovery plan with the RNIB Pension Fund Trustees to pay additional contributions of £1million per annum for 17 years. This will be part funded by a reduction in employer contributions as a result of reducing the inflation cap for pensions in payment and deferred pensions from 5 per cent to 3 per cent for benefits accruing after 30 June 2010.
Gift aid
The two subsidiary trading companies of the group contributed £62,000 to the RNIB Group through gift aid.
RNIB's reserves
Despite the continuing adverse economic environment RNIB is committed to delivering its 2009/14 Strategy.
As mentioned above, in order to do this trustees have decided that should it be necessary they would be prepared for reserves to fall below the 12-17 weeks policy, to maintain and develop the services provided.
This is not a decision taken lightly and trustees will be ever vigilant on the risks RNIB are facing and will be both proactive in their approach and respond accordingly as the economic situation develops.
Our supporters
All that RNIB does remains possible because of the continued support of donors through legacies, gifts and donations, for which we are very grateful.
The challenge of raising over £65.7million for 2010/11 is increasingly demanding in the current climate, but it is so vital to make our work possible.