IoD Report and Accounts 2007

8/14/2019 IoD Report and Accounts 2007

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The Institute of Directors

Annual Report

and Accounts 2007


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FIVE YEAR SUMMARY 2003 2004 2005 2006 2007

No. of members at Year End 53,473 53,268 52,780 52,790 52,427

Surplus/Deficit before Tax (k) 647 1,350 1,824 2,147 2,159

Gross Income (k) 30,145 31,755 33,268 34,402 35,617

Net Assets (k) 1,817 2,194 3,605 5,834 7,714

Fixed Asset Investment (k) 1,236 1,822 2,155 1,669 1,495

Investments & Cash Balances (k) 8,201 9,285 10,173 11,762 14,225

Net Assets as % of Gross Income 6.0% 6.9% 10.8% 17.0% 21.7%

Fixed Asset Investment as % of

Gross Income 4.1% 5.7% 6.5% 4.9% 4.2%

Investments & Cash Balances as

% of Gross Income 27.2% 29.2% 30.6% 34.2% 39.9%


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I am delighted about the progress that we have made in

2007. The Director Generals report goes into the detail, butfor me the highlights are:

C H A I R M A N S R E V I E W

A year of financial success and securitywith an increased cash balance at the

year end;

A healthy membership level overall, and

a focus on relevant benefits that has

been appreciated by the membership.

These initiatives have been strong atboth regional and national levels;

Further improvement of our profile in

the media and of our influencing activity

with Government, with the Opposition

and in Europe;

Continued emphasis on professional

development as a core activity and

further growth of the Chartered Director

membership;

Widening of our international presence

in a cost-effective way building, forexample, strong links with Russia through

the Independent Directors Association.

In our annual strategic review in October

2007 we reiterated the importance of the big

support our memand access to dev

such as China, Ind

will include expand

supporting our me

and information in

3. To extend our reprepresentation, en

members have a s

which to lobby the

Opposition and in

4. To utilise electroni

the full benefits of

effectively in provid

members;

5. To grow our memb

appeal to include g

from the not-for-pro

6. To maintain and a

capacity to our re

we can serve our

of the UK


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C H A I R M A N S R E V I E W

US institutions to the companies they invest

in, highlighting the importance ofprofessional leadership at board level.The

letter says: This is seen as a primary

contributor to the performance and

prospects of any business. We actively

support the value of the Chartered Director

development programmes and especially

the Chartered Director qualification provided

by the Institute of Directors.

For me the biggest disappointment of the

year has been the lack of a significant

reduction in onerous regulation and time-

wasting red tape. We have tried hard,provided much evidence, and made

proposals, but we remain stuck in the

treacle of over-regulation. Action is now

needed, rather than more review bodies!

The IoD pays particular attention to the

governance of the Institute. We do this byactively considering the balance on the

board, by ensuring appropriate terms of

office for directors, and through the

committees of the board. The board has an

annual effectiveness review, individual

assessment sessions with all directors, aseparate meeting of the chairman and non-

executive directors and feedback to the

chairman conducted by the vice chairman.

We pay particular attention to the risk

input of so many pe

time for the benefit There are many ded

branch, regional and

contribute to our su

by the commitment

guidance of the Dire

It is with great regredeath of Gregory H

Regions and Branc

Report. Gregory wa

Board from 24 Feb

death on 2 June, 2

IoD staff in 2000 asIoD South West. Gr

respected and univ

throughout the IoD

contribution to the

recent years. He wi

As the board changthank two retiring m

contribution over m

Judge stood down

Michael Large, Vice

down in December

serving both regionmany ways. Both o

supporters of the Io

as new members N

Emma Harrison, an


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I am pleased to be able to report another very successful

year for the IoD. Our finances are in even better shape, bothin terms of annual surplus and reserves, and we have

continued to build our external reputation.

D I R E C T O R G E N E R A L S R E P O R T

The total number of members remains ata robust level, but 2007 saw a very slight

decline to 52,427. Despite great efforts,

we are still losing members as fast as we

gain them. Our new customer relationship

management system will help target

members more directly and through thisand other methods we need to

understand and meet their needs better,

so that we can retain more members in

the longer term.

However, the profile of new membersshows more diversity, with 19% of new

applicants being female, and there is a

greater proportion of younger,

entrepreneurial directors coming through.

This has helped support our Young

Directors Forum, which is nowestablished in most parts of the country.

We need to further strengthen our

offering to women and to diverse ethnic

groups and our Women as Leaders

Our regional presencthe provision of loca

influencing of regiona

authorities. Our affin

various sponsors co

much support and a

membership offeringmembers tell me, the

activity is too much d

dealing with this, and

we are taking some

improve our online a

should become morand beyond. Our we

been enhanced and

develop. Our intrane

improved and I have

blog more to come

Events in 2007 range

international seminar

China, to many large

gatherings covering


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Overall Results

During 2007 the Institute made a record

operating surplus before tax for the fourth

consecutive year, 2,159k - 12k ahead

of 2006.

At 31 December 2007 the Accumulated

Fund stood at 7,714k compared with5,834k a year earlier, an increase of

1,880k, which reflects the continuing

growth of the Institutes Membership and

Revenue Earning Activities and control of

expenditure.

Net funds increased by 2,463k to

14,225k at the end of 2007, as shown

in the Consolidated Cash Flow

Statement, page 17.

INCOME

Membership Income

Membership income increased by 581k

to 14,572k in 2007 (up 4.2%). This

reflects an increase of 629k in

membership subscriptions (up 4.9%), anda decrease of 48k in election fee income

(down 4.2%). The number of members

was 52,427 at the end of 2007,

representing a net loss of 363 in

Director Publications

Development, and DCatering and functio

income by 199k to

resulting from organi

prices being held. In

the Restaurant and B

static, although the s

rooms at 116 Pall M

increase in income y

Wine Bar reflected th

equivalent operation

in income, mainly alc

following on from the

effect in July 2007. O

increased by 74k to

An increasingly comp

market continued to

effect on Director Puwhich decreased by

2,386k (down 9.3%

overheads were clos

the result that costs

8.7% compared with

Although Director De

decreased by 1.6%

to a depleted Board

team, contribution in

F I N A N C I A L R E V I E W


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210k to 1,515k (down 12.2%) mainly

due to tough competitive conditions

which adversely affected ticket sales, and

the fact that certain planned events had

to be cancelled.

Product Marketing income increased by

115k to 1,029k (up 12.6%) reflecting

continued growth in affinity products

providing preferential travel and financial

services benefits for members.

Overall contribution from revenue earning

activities decreased by 78k to 5,649k

(down 1.4%), as shown in Analysis ofOperating Surplus by Activities, page 18.

EXPENDITURE

Total expenditure of 33,458k is analysed

across Membership, Revenue EarningActivities, Member Services, Operating

and Overhead Costs and Representation

and Directorate, as shown in Analysis of

Operating Surplus by Activities, page 18.

Employment Costs

Employment costs increased by 374k to

14,516k, reflecting bonuses and

commissions paid to staff based upon a

passenger lifts, and

strengthening in the

of the Institutes pre

function areas. Sign

investment was inc

the main kitchen an

new air conditionin

boilers were installethe telephone syste

all IoD premises.

Further amounts w

including a new HR

enhancements, and

development for iod

IoDs staff intranet w

launched in the yea

Creditor Payme

The Institute suppoBetter Payment Pra

signed up to their C

all trade creditors, i

policy to agree term

suppliers, at the sta

ensure that they arewith the agreed co

legal obligations. Tr

year ended 31 Dec

17 days based on



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educational work.

No political donations were made duringthe year (2006: nil).

Cash Reserves

The Audit and Risk Committee has

recommended and the Board has agreedthat we build up our cash reserves, net of

deferred membership income, to a level

that matches our annual fixed costs,

comprising property and staff overheads,

in order to provide protection against a

prolonged economic downturn. Therelevant figures are:

2007 2006

Cash reserves at 31 December 14.2m 11.8m

see Consolidated Cash Flow

Less deferred membership income (8.0m) (8.1m)

see notes 12&13

Net cash reserves at 31 December 6.2m 3.7m

Target cash reserves / annual 14.1m 13.8m

fixed costs

Net cash reserves as percentage 44.0% 26.8%

of target

Going Concern

The Board considershas adequate resou

operational existenc

future. For this reas

concern basis contin

preparing the financ



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G O V E R N A N C E O F T H E I N S T I T U T E

1. Aims and Objects of the IoD

The IoDs Charter states that its objects are:

(a) to promote for the public benefit high

levels of skill, knowledge, professional

competence and integrity on the part of

directors, and equivalent office holders

however described, of companies and other

organisations;

(b) to promote the study, research and

development of the law and practice of

corporate governance, and to publish,

disseminate or otherwise make available the

useful results of such study or research;

(c) to represent the interests of members and

of the business community to government and

in the public arena, and to encourage and

foster a climate favourable to entrepreneurial

activity and wealth creation; and

(d) to advance the interests of members of

the Institute, and to provide facilities, services

and benefits for them.

2. Activities of the IoD

Professional Development the Institute

provides training and professional

development both in the UK and, to a lesser

degree, elsewhere. This takes the form of

courses, conferences and seminars, as well

it Di l i C Di ti d th

Members Benefits

Institute provides pre

the regions for the us

Members also are gi

information and advi

information via the w

two regular magazin

services such as a g

discounted insuranc

service are offered to

variety of events, inc

Convention at the Ro

Annual Dinner. More

www.iod.com.

3. Principal Goals

The Board has a ma

meeting each Octob

months later, and it t

issues at regular Boa

Principal Goals emer

years are:

Expanding Professi

Nationally and Inter

International contextIoD brand, influence

particularly in the fiel

Governance, as the

world leader on this


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Expanding Membership both Nationally and

Internationally. We should continue to grow

and we have been tasked with expanding in

the Third Sector, which includes the Public

Sector, Senior Civil Servants, Quangos and

Government type Institutions, Trusts,

Charities, the National Health Service,

Influential and Representative Bodies, Policy

Groups, Heads of Secondary Schools, the

Armed Forces, Pension Fund Trustees and

one or two other associated bodies.

We shall establish the views of the

membership as a whole from online surveys.

Member programmes and benefits will be

changed or modified accordingly. With a view

to promoting diversity, we shall encourage the

aspirations of ethnic minorities, entrepreneurs,

women and younger directors.

Provision of Regional Premises is seen as

very important going forward. We believe that

the future will bring significantly more virtual

corporations, and that employers will

increasingly encourage their staff to work

remotely or at home to save time, cost and

travel. Directors will require meeting facilities

in key locations. The IoD has recognised this

need and will investigate the expansion of its

regional network.

Advances in IT and the Internet have been

The IoD is currently eng

website, www.iod.com

the latest internet devel

commerce functionality

office systems will be c

platform which will link d

website. The upgraded

development work is pl

by the end of 2008, wh

effective electronic com

members, as well as en

engage with the IoD on

Security arrangements

systems to ensure there

unauthorised access of

Reputation we aim t

reputation, influence an

ensure that our membe

voice to lobby governm

other influential and rep

Europe for the benefit o

4. Governance and

the Institute

The Institute is a corpounder Royal Charter. T

comprising Charter, By

Regulations, may be fo

website, www.iod.com



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Corporation established under Royal Charter.

The government and control of the Instituteare vested in the Board and the Council of the

Institute. Members of these bodies are listed

on page 25, indicating relevant dates for

those who joined or departed during the year.

Council The Council is primarily the body that

is the guardian of the Constitution and of the

aims and nature of the Institute. It appoints and

may remove members of the Board and it

reviews the overall performance of the Board. It

also appoints the Nomination Committee. The

Nomination Committee considers the balance

of skills needed by the Board and considers

candidates, including any nominations put

forward by the membership, and makes

recommendations to the Council in respect of

appointments to the Board. Such nominations

are put as a courtesy to the Board in advance.

An induction programme is in place for new

members of the Council and the Board. The full

rules regarding Council and Board are set out

under By-laws and Regulations Clauses D & E

respectively. Council Members also provide a

pool of expertise, which the Chairman and DG

may consult on a range of policy issues and for

contacts. The Council, chaired by the

Chairman of the Board usually meets with all

members of the Board in attendance by

invitation but they may at any time require that

In accordance with its

Chairman and the DG

responsibilities and th

majority of Non-Execu

effectiveness of the B

annually. Periodically a

will be commissioned

place in 2004. Trainin

Board members is co

following the Annual E

Assessments of the B

directors. NEDs and t

assessed by the Chai

is assessed by the Vic

Directors are assesse

At least once per ann

meeting with the NED

present. The Institute

ensuring that Board p

with. All Board memb

disclose to the Institutthey may have in othe

entities and in public b

Committees during

Membership of the Io

out on page 25. Threspecifically with gove

The Nomination Com

the Council and chai

d d


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The A&RC undertakes an annual internal

review of its effectiveness under the direction

of the Committee Chairman.

The A&RC considers annually whether there is a

need for an internal audit function and the view

remains that the size of the Institute does not

warrant it at this stage. It is the Institutes policy

to separate the provision of audit and non-auditservices, but the Board may waive this policy, in

specific cases, if it considers such waiver to be

in the best interests of the Institute.

The Remuneration Committee, appointed

by the Board and chaired by the Chairman, in

accordance with the Institutes Constitution,

advised on the remuneration of senior

members of staff and it met as necessary.

In addition the activities of the Institute were

greatly assisted by three advisory

committees, which each met twice per

annum or more regularly as appropriate and

they included outside experts:

The Professional Accreditation Committee,

chaired by Mr Peter Hammonds, advised on

Chartered Director, professional standards,

and the award of the Diploma and Certificatein Company Direction.

The Taxation Committee, chaired by Mr

Graham Wheeler, advised on taxation.

The IoD demands a ve

ethical behaviour in all

external dealings, and

the value of diversity th

organisation, clearly re

of British Society and t

Community as a whole

seen as a model exam

companies in both of t

standards of Corporat

Institute has a policy o

employment and conti

diversity and inclusion

Diversity awareness tra

run for all new staff in 2

understanding and co

Our approach as a go

responsibility and to th

embedded in our emp

a range of Standard Gavailable to all staff on

reason Department He

time off to undertake a

community. We aim to

exemplary manner wit

the principal one being

5b Employees

The calibre, values an

people are central to



14/32


Communication with employees has continued

via quarterly all staff meetings on business

progress, Departmental staff briefings, the

Institutes intranet, IoD News, and the

distribution of the Annual Report and the Three

Year Plan. Every employee has an individual

responsibility to work together as a team to

further the purposes and ideals of the IoD.

The aim is to ensure employees views are

taken into account when decisions are made

that are likely to affect their interests, and that

they are aware of the financial and economic

performance of their Departments and of the

Institute as a whole. The Institute isaccredited with the quality benchmark

Hospitality Assured.

5c Open Disclosure Policy

The Institute has an Open Disclosure Policy

(sometimes known as a Whistle-Blowing

Policy), made available to all staff on theIntranet under SGN 2.25. Any matter

reported under this heading has received

proportionate and independent investigation

and the Senior Management Team has

ensured appropriate follow-up action.

5d Values

The IoD continued to embed its five new

values into its culture during the year.

Values related questions and measurement

closely with our mana

promote diversity and

5e Training and Dev

The Institute continue

recruitment and train

providing a range of

development interven

individual needs and A significant manage

programme, designe

the Management Tea

to all middle and sen

5f Health & Safety

The IoD has a H&S Cdepartment strives to

employees are provid

appropriate environm

complies with H&S le

Regulations.

5g Environmental P

In respect of its Mem

workplace, and its e

(locally and in genera

to implementing best

providing a safe and

Board will implement

current environmenta

various European Un

take account of the v

d S f t C itt



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covered by the financial statements were:

A clear organisation structure for monitoringthe conduct and operation of the Institute

with defined reporting lines, levels of

responsibility and delegation of authority.

Communication of ethical values and a

controls awareness through written codes

of conduct, formal standards of discipline

and employee performance appraisal.

Regular consideration by the Board of

management accounts.

Three meetings of the A&RC, including a

review of the Institute's risk management

and discussions with the external auditors

with regard to the scope of the audits and

the contents of their reports to

management.

Schedules of Matters Reserved to theBoard and of Levels of Authority and

Authorisation Procedures, approved by the

Board, the latter comprising the detailed

management rules, remain in place.

7. Risk Management

In accordance with the guidance of the

Turnbull Committee on internal control, there

is an ongoing process in place for identifying

The Board reviews the

by the A&RC twice pe

specific risk aspects as

In preparation for the c

disaster, there is in pla

Action Plan and a long

Recovery Plan. These

reviewed and revised.

The Institute annually r

portfolio and considers

due regard to cover ta

organisations. We belie

adequate and broad c

premiums are kept at a

ensuring cover levels a

hit, but balancing this a

amount, so that claims

substantial. We have a

arrange a capped prem

continuity for three yea

The A&RC has reviewe

effectiveness of this fra

Committee acknowled

limitations in any syste

internal financial controthe most effective syst

reasonable and not ab

respect to risk mitigatio

financial information an

I N D E P E N D E N T A U D I TO R S R E P O R T


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I N D E P E N D E N T A U D I TO R S R E P O R T

to the members of the Institute of Directors (the Institute)

We have audited the consolidated financial

statements of the Institute of Directors for the

year ended 31 December 2007 which

comprise the consolidated revenue account,

consolidated balance sheet, consolidated cash

flow statement, the consolidated statement of

total recognised gains and losses and the

related notes. These financial statements have

been prepared under the accounting policiesset therein.

Respective responsibilities of directors

and auditors

The Boards responsibilities for preparing the

annual report and the financial statements inaccordance with the By-Laws and applicable

accounting standards in the United Kingdom

are set out in the statement of Boards

responsibilities.

Our responsibility is to audit the financial

statements in accordance with relevant legaland regulatory requirements and International

Standards on Auditing (UK and Ireland). This

report, including the opinion, has been prepared

for and only for the Institutes members as a

body and for no other purpose. We do not, in

giving this opinion, accept or assume

responsibility for any other purpose or to anyother person to whom this report is shown or

into whose hands it may come save where

expressly agreed by our prior consent in writing.

consider the implicatio

become aware of any

or material inconsisten

statements. Our respo

to any other informatio

Basis of audit opin

We conducted our au

International Standard

Ireland) issued by the

An audit includes exa

of evidence relevant to

disclosures in the fina

includes an assessme

estimates and judgmein the preparation of t

and of whether the ac

appropriate to the Ins

consistently applied a

We planned and perfo

obtain all the informatwhich we considered

provide us with suffici

reasonable assurance

statements are free fro

misstatement, whethe

other irregularity or err

In forming our opinion

overall adequacy of th

information in the fina

C O N S O L I D A T E D R E V E N U E A C C O U N T


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NOTES 2007

000

INCOME

1 Membership income 14,572

Revenue earning activities 17,416

Other trading income 2,890

Interest receivable and similar income 739

_________

35,617 _________

EXPENDITURE

2 Employment costs 14,516

Direct costs 7,839

3 Indirect costs 5,743

Property expenditure 4,094

Depreciation 1,266

_________

33,458 _________

Surplus on ordinary

activities before taxation 2,159

4 Taxation (234)

_________

Surplus on ordinaryactivities after taxation 1,925

____

All operations in the year and in the comparative

year were continuing.

C O N S O L I D A T E D R E V E N U E A C C O U N T

for the year ended 31 December 2007

C O N S O L I D A T E D B A L A N C E S H E E T


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C O N S O L I D A T E D B A L A N C E S H E E T

at 31 December 2007

NOTES 2007

000

FIXED ASSETS

Intangible fixed assets

Publication rights ofDirectormagazine 2

5 Tangible fixed assets 5,476

6 Investments 20_________

5,498_________

CURRENT ASSETS

7 Stock 168

8 Debtors 3,014

9 Short term investments 13,712

10 Short term bank deposit 10

10 Cash at bank and in hand 503

_________

17,407_________

CURRENT LIABILITIES

11 Creditors amounts falling due within one year (7,159)

12 Deferred membership income (7,018)

10 Bank overdraft _________

(14,177)

_________

Net current assets 3,230_________

Total assets less current liabilities 8,728_________

13 CREDITORS

Amounts falling due after more than one year (969)_________

Net assets excluding pension liability 7,759

15 Pension liability (45)_________

Net assets including pension liability 7,714____

C O N S O L I D A T E D C A S H F L O W S TA T E M E N T


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Net cash inflow from operating activities 3

(see reconciliation below)

Returns on investments and servicing of finance

Interest received

Taxation

UK Corporation tax paid

Capital expenditure

Payments to acquire tangible fixed assets (1____

Cash inflow before use of liquid resources 2

Management of liquid resources

Purchase of short-term investments (1

Decrease / (increase) in short-term deposits with bank____

Increase / (decrease) in bank current account in the year

__

Reconciliation of surplus on ordinary activities

to net cash flow from operating activities

Surplus on ordinary activities before taxation 2

Depreciation on tangible fixed assets 1

Loss on disposal of fixed assets____

3

Interest receivable and similar income____

2

(Increase) / decrease in trade debtors

(Increase) in other stock, other debtors and prepayments

Increase / (decrease) in trade creditors

(Decrease) /increase in other creditors and accrualsIncrease / (decrease) in multiple years advance membership over one year

(Decrease) /increase in deferred membership income

Increase / (decrease) in other deferred income

Difference between pension charge and cash contributions____

C O N S O L I D A T E D C A S H F L O W S TA T E M E N T


A N A LY S I S O F O P E RA T I NG S U R P L U S BY A C


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A N A LY S I S O F O P E RA T I NG S U R P L U S B Y A C


2007 2007

Income Expenditure

000 000

MEMBERSHIP INCOME

Membership subscriptions 13,360

Election fees 1,088

Overseas capitations 124 _________ _________

14,572

MEMBERSHIP EXPENSES

Marketing and membership 12 (2,062)_________ _________

14,584 (2,062)

REVENUE EARNING ACTIVITIES

Catering and functions 5,069 (3,882)

Director publications 2,386 (2,270)

Director development 5,047 (2,929)

Business centre 2,370 (649)

Director events 1,515 (1,582)

Product marketing 1,029 (455)_________ _________

17,416 (11,767)MEMBER SERVICES

Regional services 2,296 (4,578)

Member information and advice 275 (1,210)_________ _________

2,571 (5,788)

OPERATING AND OVERHEAD COSTS

Property costs (4,136)

Depreciation (1,223)

IT and iod.com (2,499)

Central administration (3,298)_________ _________

N O T E S T O T H E A C C O U N T S


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1 ACCOUNTING POLICIES

The Institute of Directors is not subject to the

Companies Act 1985. However, these financialstatements have been prepared in accordance with

applicable Accounting Standards in the United

Kingdom and incorporate the disclosures required by

the Companies Act 1985 in respect of directors'

emoluments for a private limited company. A summary

of the more important policies, which have been

consistently applied with the prior year, unlessotherwise disclosed, is set out below:

(a) Basis of accounting and consolidation

These financial statements have been prepared under

the historical cost convention and comprise

the consolidated accounts of the Institute, its wholly

owned subsidiaries, The Director Publications

Limited, IoD Management Limited and iod.com limited.

(b) Membership income

Annual membership subscriptions are included in the

Consolidated Revenue Account on an accruals basis

applicable to the membership period, and the part of

the subscription applicable to the following year is

carried forward as deferred income. In the case ofmultiple year membership subscriptions, an annual

allocation is included within the Consolidated Revenue

Account, the unutilised income being carried forward

to future years. Election fees are accounted for on a

receipts basis.

(c) Tangible fixed assets

Tangible fixed assets are recorded at historic cost,

together with any incidental costs of acquisition.

Depreciation is calculated on a straight line basis over

the expected useful economic lives of the assets

concerned. The principal annual rates used for this

of the building at 116 Pa

under a lease expiring in

standard which is consisearning potential.

(f) Pension scheme

During 2007 the Institute

contributory defined con

benefits accruing from 1

defined benefit pension

both schemes are held s

Institute and are adminis

(g) Overseas currenc

Assets and liabilities den

have been translated into

current at the year end,

taken through the Conso

(h) Short term invest

Sterling fixed and floating

term investments are inclu

value. Variations in their ye

through the Consolidated

(i) Stock

Stock is valued at the lowe

2 EMPLOYMENT COS

(a) The average numb

employees during th

(b)Salaries




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2007 2006

000 000

(d) Emoluments paid to the

Director General amounted to:

Salary 271 263

Performance bonus 57 55

Pension contributions 39 38

Benefits-in-kind 28 32

_________ _______

395 388_________ _______

Pension contributions are paid

into a money purchase scheme.

(e) Executive directors

emoluments excluding pension

contributions

Director General - 2(d) above 356 350_________ _______

6 other directors

(2006: 6 directors)

Salary 486 536

Bonus 148 155

Benefits 26 26_________ _______

660 717_________ _______

Aggregate emoluments 1,016 1,067_________ _______

Aggregate value of pension

contributions paid in respectof money purchase benefits

Director General 2(d) above 39 38

6 other directors 97 101

(2006: 6 directors)

3 INDIRECT COSTSGeneral Administrati

Marketing and Prom

Professional fees

Financial charges

Fees in respect of se

provided by the aud

Statutory audit

Tax advisory serv

4 TAXATION

Current tax:

UK Corporation tax

Corporation tax is payabderived sources of incom

The Director Publications

owned subsidiary. The In

are outside the charge to

No provision for deferre

a potential tax asset of

capital allowances, whithe future if capital exp

current planned level.

5 TANGIBLE FIXED A

Le

Improv

Cost

At 1 Jan 2007

Additions

Disposals



23/32

6 FIXED ASSET INVESTMENTS

Investments represent the cost of a 1% shareholding in

Stonemartin plc, being 1,019,345 ordinary sharesof 20p. The market value of the shares at 31

December 2007 was 52,000 (2006: 78,000).

2007 2006000 000

7 STOCK

Food, wines, liquor 120 82Books and stationery 47 20

Other stock 1 2_________ _________

168 104____ ____

2007 2006000 000

8 DEBTORS

Trade debtors 1,782 1,553

Other debtors and prepayments 1,232 1,262_________ _________

3,014 2,815____ ____

9 SHORT TERM INVESTMENTS

Market MarketValue Cost Value Cost 2007 2007 2006 2006000 000 000 000

i) Fixed and

floating interest

securities 1,401 1,350 11,749 11,700

_____ _____ _____ _____ii) Clydesdale

Bank

6,154 6,000

iii) Bank of

10 CASH AT BANK AND

Cash at bank and in han

238,000) held in overseThe analysis of the move

follows:

Short term bank depo

Cash at bank and in ha

11CREDITORS

Amounts falling due w

one year:

Trade creditors

Deferred non members

Other creditors and a

Taxation

12DEFERRED MEMBE

INCOME

Membership subscrip

received in advance

Multiple years memb

subscriptions applicab

the following year




24/32


14LEASE COMMITMENTS

The Institute has annual commitments under

non-cancellable operating leases as follows:

2007 2006

2007 Motor 2006 Motor

Property Vehicles Property Vehicles

000 000 000 000

Operating leases

which expire:

Within one year 11 18

In the second to

fifth years inclusive 185 6 108 6

In over five years 1,236 1,243 _____ _____ _____ _____

1,421 17 1,351 24____ ____ ____ ____

The property leases are subject to rent reviews.

Rental costs charged to the Consolidated Revenue

Account in the year were:2007 2006

000 000

Property 1,442 1,309

Motor Vehicles 42 49____ ____

15PENSION COSTS

During 2007 the Institute operated both a non-

contributory defined contribution pension scheme

for benefits accruing from 1 January 1997 and a

closed defined benefit pension scheme (the closed

scheme). The assets for both schemes are heldseparately from those of the Institute and are

administered by trustees, and both schemes are

registered with HM Revenue and Customs.

With effect from 1 January 1997 (the closure date),

date. The principal f

for that actuarial val

at 4.8% per annumannum. Future pens

the rates specified i

Pension contributio

1997 defined contrib

Closed scheme

Total cost

Financial Reportin

(FRS 17) relating to

A subsequent valua

accordance with the

been prepared by a

of membership data

but taking into acco

payment effective fr

Employee benefit o

Amounts recognise

Balance Sheet are:

Defined benefit oblig

- see analysis below

Fair value of plan as

- see analysis below

Surplus before allow



25/32

at at

31 Dec 31 Dec

2007 2006

000 000

Change in defined benefit

obligations are:

Obligations at 1 January (6,665) (6,850)

Service cost (100) (100)

Interest on obligations (341) (323)

Actuarial gains/(losses) 796 267

Benefits paid 344 341

Obligations at 31 December

- noted above (5,966) (6,665)____ ____

Change in fair value of plan

assets are:

Assets at 1 January 6,885 6,112

Expected return 385 324

Investment (losses) / gains (56) 190

Employer contributions 100 600

Benefits paid (343) (341)

Assets at 31 December

- noted above 6,971 6,885

____ ____

As the pension surplus is irrecoverable, the annual

increase of 785,000 has been treated as an

actuarial loss in the Statement of total recognised

gains and losses.

at at

31 Dec 31 Dec

2007 2006

Actual return less expected

return on pension scheme assets (56) 190

Experience gain/(loss) arising on

h li biliti 234 (65)

Major categories of p

total plan assets are:

UK equities

UK bonds

Principal actuarial ass

at the Balance Sheet

Discount rate

Expected return on pla

Price inflation

Pension increases:

Post 1988 guarante

minimum pension

Discretionary awardMortality:

Pensioner life expec

by year of birth

Proportion married

Age difference

Age at retirementCommutation

Sensitivity to change

The assumptions as t

discount rate and pric

inflation have a signific

effect on the value pla

on the defined benefit

obligations.

As at 31 December 2

a 1% change in these

assumptions would h




26/32

2007 2006000 000

Five year historic record at 31 December:

Defined benefit obligations (5,996) (6,665)

Plan assets 6,971 6,885

Surplus/(deficit) 1,005 220

Experience adjustments on plan liabilities 234 (66)

Experience adjustments on plan assets (56) 190

16CAPITAL COMMITMENTS 2007 2006000 000

Contracted capital expenditure 67 ____


C O U N C I L , B O A R D A N D C O M M I T T E E S


27/32

as at 31 December 2007

COUNCIL

Chairman

Dr Neville Bain

Elected members

Richard Boot (departed 25.07.07)

Ald Sir David Brewer CMG

Nicholas Brookes (departed 11.04.07)

Nicholas Cook (joined 11.04.07)

Michael Foote

Alex Galloway (joined 11.04.07)

Peter Hammonds

Professor F R Hartley

Alan Jenkins (joined 25.07.07)

Patrick Lawless

Dr Ann Limb

The Rt Hon Lord Newton of

Braintree OBE

The Rt Hon Lord MacGregor of

Pulham Market OBE

(departed 25.07.07)

Dr Mary Redmond

Gerald Russell (joined 25.07.07)

Derek Wilson

Sir Robin Young KCB

(departed 11.04.07)

Regional Members

Frank Bryan

Jerry Golland

John James (departed 02.04.07)

Ann Jordan

BOARD

Non-Executives

Dr Neville Bain (Chairman)

Ian Dormer (Vice Chairman)

Michael Large (Vice Chairman)

Simon Brooker

Nicholas Brookes (joined 11.04.07)

Philippa Foster Back OBEEmma Harrison (joined 11.04.07)

Peter Holland

Lady Judge (departed 31.07.07)

Sir Hugh Sykes

Graham Wheeler

Sir Robin Young KCB(joined 11.04.07)

Executives

Miles Templeman (Director General)

Andrew Main Wilson (COO)

Bill Adams

Vernon George (joined 21.05.07)

Gregory Hyland (see page 2)

Alan Morkel

Richard Turner

COMMITTEES

Audit & Risk

Simon Brooker (Chairman)

Richard Boot

Robert Oxley

Rosco Paterson

TaxatiGraham

Adrian

Damian

Roger C

Malcolm

Brian JRobert

Andrew

Peter M

Michae

Tim Vo

Profes

Peter H

Philippa

(Vice C

Philip A

Tim Bo

ProfessAlex Ga

Profess

Denis L

Colin M

Roger M

Sally M

Ken Ru

Beverle

John W

N i

S TA T E M E N T O F B O A RD S R E S P O N S I B I L I T I


28/32

As a corporation established by Royal

Charter, the Institute is obliged to

comply with its Constitution (comprising

Charter, By-Laws and Regulations).

The Constitution requires that the Board

lays before the Institute financial

statements for each financial year which

give a true and fair view of the state of

affairs of the Institute and of the surplus

or deficit of the Institute for that period.

The Board is responsible for keeping

proper accounting records that disclose

with reasonable accuracy at any timethe financial position of the Institute.

Additionally the Board is responsible for

safeguarding the financial welfare and

assets of the Institute and hence for

taking reasonable steps for the

prevention and detection of fraud and

other irregularities.

The Board confirms that it has complied

with the above requirements in preparing

the financial statements and that

suitable accounting

used and applied c

any material depar

explained in the fin

The Board also co

and prudent judge

have been made in

the financial statem

ended 31 Decemb

applicable account

been followed and

statements have b

going concern bas

The Annual Report

published on the In

www.iod.com/ann

is responsible for t

integrity of the web

R E G I O N S , B R A N C H E S , C E N T R E S A N D A F F I L


29/32

as at 31 December 2007

REGIONS

East Midlands

Chairman: Peter Fothergill

East of England

Chairman: Jerry Golland

North East

Chairman: Bill McGawley

North West

Chairman: Ann Jordan

South

Chairman: Robert Oxley

South West

Chairman: Paul Keith

West Midlands

Chairman: Richard Boot

YorkshireChairman: Nimble Thompson

DIVISIONS

Northern Ireland

Chairman: Frank Bryan

Scotland

Chairman: Andrew Sturgess

Wales

Chairman: Gareth Williams

UK BRANCHES

Aberdeen

Chairman: Ken McEwan

Berkshire

Chairman: Chris Dodson

Cumbria

Chairman: Roger Collinge

Devon and CornwallChairman: Richard Ayres

Cambridgeshire

Chairman: Chris Parkhouse

East Yorkshire

Chairman: Richard Tuplin

Edinburgh

Chairman: Rebecca Cuthbert

Essex

Chairman: Paul Rolison

Dundee

Chairman: Dr Nigel Kerby

Fife

Chairman: Shona Mitchell

Glasgow

Chairman: Neville Washington

Gloucester

Chairman: Benita Sutton-Cegarra

Hampshire and The Isle

of Wight

Chairman: Avril Owton

Hereford & Worcester

Chairman: Michael Greensmith

Hertfordshire

Chairman: John Stevens

Highlands & Islands

Chairman: Paul Houlden

Kent

Chairman: Frazer Thompson

Lancashire

Chairman: Nina Lockwood

North Wales

Chairman: Steve Donnelly

North YorkshireChairman: Chris Harringto

Nottinghamshire & Derbysh

Chairman: Murray Macnab

Oxfordshire

Chairman: Bruce Hunt

Somerset

Chairman: Guy Bottard

South Wales

Chairman: Robin Morrison

South Yorkshire

Chairman: Richard Wagsta

Suffolk

Chairman: Tim Ryan

Surrey Downs

Chairman: Tony Cherrett

Sussex

Chairman: Leonard Stall

Wessex

Chairman: Jonathan Clark

West Surrey

Chairman: Michael Price

West Thames

Chairman: Peter Firth

West Yorkshire

Chairman: David Winterbu

Wiltshire

Chairman: Jon Lamonte

OFFSHORE BRANCH

P R E M I S E S


30/32

116 Pall Mall

London SW1Y 5ED

also at:

120 Pall Mall

123 Pall Mall

1 Pall Mall East

IoD hub City of London

New Broad Street House

35 New Broad Street

London EC2M 1NH

IoD Belfast

Ulster Reform Club

4 Royal AvenueBelfast BT1 1DA

IoD hub Birmingham

One Victoria Square

Birmingham B1 1BD

IoD Brussels

Le Plaza Hotel

Boulevard Adolphe Max

Laan 118-126

1000 Brussels

BELGIUM

IoD Cardiff

The Park House Club

20 Park Place

Cardiff CF10 3DQ

IoD Edinburgh

The Royal Scots Club

29 Abercromby Place

Edinburgh EH3 6QE

IoD hub Manchester

Peter House

Oxford Street

Manchester M1 5AN

IoD Nottingham

Trent Bridge

Nottingham NG2 6AG

IoD Paris

France-Amriques9/11 avenue Franklin

D. Roosevelt

75008 Paris

FRANCE

IoD hub Reading

Davidson House

Forbury Square

Reading RG1 3EU


31/32


32/32

Documents

IoD Report and Accounts 2007