[IMCR]

Thats excellent I stand corrected and very pleased to see the accounts are now on their site.

[rikur_]

From a quick glance through they don't look too bad.
Slight decline in membership income between the years. Largest expense is staff costs, which although painful, is usually relatively easy to trim if needs be; membership fees could presumably be increased slightly if necessary.
Of the £50k difference between this year and last, £40k appears to be a single provision for a bad debt.

It's worth remembering that it is by constitution a not for profit company - the idea isn't to turn in a profit, nor presumably to have excessive reserves.

Between my wife and myself we sit in several positions (charity trustee, Parish Councillor, School Governor, swimming club treasurer) all of which have the aim not to make a profit. We regularly get scrutiny (e.g. new Councillors, new committee members) who join from a business background who are alarmed by the finances, because they are cultured to be turning in a profit - they seem to struggle with the concept that it is not necessarily a bad thing for the primary school to finish the year with less cash in the bank than it started the year providing we understand the macro picture, and know where our contingencies are.

[stevelup]

Just to be clear, that 'bad and doubtful debt' provision is actually for AOPA (UK)

It's explained here:-

During the year the company loaned AOPA (UK) Limited, a wholly owned subsidary of the company £49,493 and was repaid £19,384. At the balance sheet date the company was owed £47,614 (2017: £59,276) by AOPA (UK) Limited. In addition, a provision of £41,181 (2017: £6,871) was made against this debt.

I wonder why BLAC consider the AOPA loan a 'bad or doubtful debt'. It is, admittedly, a bit curious.

This arrangement (or at least the reasoning behind it) has evidently caused some consternation and was discussed at the latest AGM:-

Directors Report and Financial Statements for the year ended 31st March 2018. The draft version of the Directors Report and Financial Statements for the year ended 31st March 2018 had been discussed and approved by the BLAC Ltd Board at its meeting on 10th July 2018. Some discussion followed, in which the relationship between the wholly owned company AOPA (UK) Ltd (the shop) and BLAC Ltd was provided by the Chairman. A proposal that the financial statements are a true and accurate record was made by Michael Cross, seconded by Pauline Vahey and carried.

[Mike Tango]

It’s a bit disingenuous to compare AOPA UK to AOPA USA.

One is pretty much a one man band with limited funds and a few thousand members, the other has a large professional staff, multi million dollar budget and a membership of circa 400,000.

Little wonder that one seems to be more effective than the other, but only one of them represents the interests of U.K. pilots.

If the smaller one is to in any way emulate the larger, it needs the support and involvement of the community it represents and that is best achieved by joining and getting involved rather than slings and arrows from the sidelines.

If you are a U.K. private pilot perhaps ask not what AOPA U.K. can do for you, but what you can do for AOPA UK.

[riverrock]

A quick glance at AOPA UK accounts show they don't publish profit / loss but that total equities are up by about 10k on the previous year.
Suggests the loan is for cash flow?

[2Donkeys]

I've never been particularly impressed by AOPA UK, but I have no dog in this particular race.

I do know something about reading accounts though.

AOPA (UK) Limited, which I understand to be the shop, is in a horrible mess financially and its ability to pay its way is becoming worse rather than better. It exists because the parent BLAC, lends it money. This year, the black hole represented by AOPA (UK) benefited from a net 30K extra of cash, which BLAC is unlikely ever to see back.

BLAC is also doing poorly from a trading point of view, whilst receipts are up, so are costs, resulting in an increased trading deficit.

From a balance sheet point of view, BLAC is increasingly cash poor, resulting in it needing to take out a bank loan, which newly appears on the most recent accounts. This presumably keeps the lights on.

Whilst the loan to AOPA (UK) to keep that boat afloat still features as an asset on BLAC's balance sheet, BLAC are increasingly providing for that money never coming back. 30K or so of 120K has already been provided for as potential bad debt.

The effect of a complete default would be very unhelpful to BLAC from a cash standpoint but looks inevitable unless things at the shop change quite dramatically.

If as others say, 50a Cambridge St is owned by BLAC, then this would represent a valuable get-out-of-jail card. It would certainly be possible to sell or lease that property out and get the show back onto an even keel.

Right now though, looking in from the outside, there is a sense of financially kicking the can down the road.

[Dave Phillips]

Right now though, looking in from the outside, there is a sense of financially kicking the can down the road.

..... in good old GA fashion.

Personally, I do think it time for the various associations to bite the bullet and combine resource/capability; I'm not just talking about alliances. UK GA is small and cannot afford duplication of effort. It doesn't really matter who that organisation is, there are common themes and threats across the board:

Airspace
Regulation
Airworthiness
Security
Safety
Infrastructure/Estates
Risk Management


Flip, that sounds something like the CAA structure. Funny old thing.

[Flying badger]

Thank you. This thread has reminded me to renew my aopa membership.

[IMCR]

Thank you. This thread has reminded me to renew my aopa membership.

You are joking!!! Please dont say that. Apparently my mischief making should have exactly the opposite effect. Well done though, that is exactly what UK needs, and perhaps more poeple to shake the thing up, rather than its usual collection of bury their head in the sand types .

Some good comment at long last regarding their accounts.

They are indeed a strange set of accounts which invite lots of questions, without answers. For example "the other creditors" have increased very significantly. This in theory is monies owed to third parties, not specifically falling under any other category. I wonder why and what it is?

As other have said, there is also a new bank loan, but that seems to have ended up as cash in the bank, and also now a pretty reasonable bank balance, without it being easily apparent why such a balance would be required.

My concern arose from the overall position of the two companies. Depending on what is really behind some of the figures, if you add the net equity together of the two companies, then the position appears far from healty if all the creditors (or more especially the other creditors) called in their debts. I have no doubt there is more to it, and the members may well know, but the accounts do not tell us.

I wonder why the committee didnt have the courage of going to the members if they need more money than going to the Bank, and probably paying significant lending fees and many points above base interest. I assume the Bank will have charged the property anyway, but this also isnt clear (or I may have missed it). Maybe they did, and this is what the other creditors are all about?

At least the auditors havent expressed any going concern issues, so they must be satisfied!

As to it not being a not for profit organisation, that is fair comment, however I think the idea is that it makes enough profit to deal with future projects, future contingency (such as a fall in income for one reason or another) and other contingencies. Running at breakeven year on year is not good for the health. Running at a loss for many years is certainly troubling because that is not sustainable.

Are things going better this year?

Clearly a few new memberships from this thread should help, perhaps I should be checking my PMs for the letter of thanks?

[2Donkeys]

@IMCR IMCR

The accounts are not great, but they don't contain the degree of inexplicability and intrigue that I sense you are after.

The loan is quite visibly needed to meet current cashflow.

The bank balance looks healthy at 216k, but all of that and more is required in order to meet the 361k of short term liabilities also shown on the accounts. In fact, with all immediately liquid assets (including debtors), there is still a shortfall of assets to cover that 361k. This explains the 9k in net current liabilities - a deterioration from last year's position in terms of apparent solvency.

'Other Creditors' is large, growing, and interesting. Somebody, unrelated to the board has presumably lent money to the company on a short term basis and expects it back. This sort of thing is not uncommon. Had you been at the AGM, it would have been a good question to put to the board, since it is quite a material sum. Either way, we don't know on what basis that money has been lent, and whether the terms are better or worse than the company obtained for its bank loan.

With the (presumed) asset of 50a Cambridge St underpinning the accounts, there really isn't a 'going concern' issue here, which is presumably why it doesn't get a mention, other than by you.

There is no loan secured against 50a Cambridge St, because such a charge would also be registered at Companies House. No intrigue there either. EDIT: There is a charge registered by Barclays in 1976 against 50a Cambridge St covering any and all sums due to Barclays from the company. The loan we see in the accounts is presumably secured against this overarching charge.

[Mick Elborn]

@IMCR I won't hide behind a handle or PM. I will publicly thank you if your biennial review of AOPA accounts has resulted in more members!

That was your intention really wasn't it? Come on don't be shy ......

But I will also repeat that if anyone reading this thread is a Pilot and doesn't belong to at least one of the Organisations then you should. If you are a Student Pilot you can join AOPA for free - you would have to check the other organisations to see if they do.

I recognise that a good number of pilots do operate on a small budget and do a few number of hours a year, which makes membership of an organisation seem expensive in comparison. Why not just give one of the organisations a small donation now and again, giving at least a little back for the work that they do.

[IMCR]

2Donkeys - fair points, although it is not a sense of intrigue, but exactly the point you go on to make in para 3 - it is interesting.

You, just as I, can make lots of assumptions, but they are just that. If it is a short term loan as you suggest and someone wants it back soon, then the actual liquidity will look very different, very quickly. No intrigue there either, just an observation. Why someone would lend that sum on a short term basis is also interesting, and I am sure there may be many good reasons.

I take your point reagrding security, but I have rarely known a bank to lend that sum without security. Who knows, perhaps the bank thinks it is a rock solid bet.

As to the property if sold then I assume it would need to be replaced or rent paid. Selling assets to salvage a position is never a good idea in the longer term, so I am not convinced that is a relevant answer. Of course (and I am not going there again) that is assuming a property of this value (whatever that maybe) is really warranted, but in the past we have always been told it is, and isnt worth as much as some may think).

"That was your intention really wasn't it? Come on don't be shy ......

Oh, thanks, I think

[johnm]

I’m involved in trying to turn round a not for profit special interest organisation that has been in the doldrums for a while. Having substantial assets gives some time to work that through, but it isn’t necessarily trivial.

Martin is heavily occupied with the core activity of seeking to promote GA interests in various fora, so I start to wonder if the Directors are a bit like the Committee I took over and am trying to revitalise!

[Mike Tango]

Try joining rather than mischief making, it would probably be more productive all round.

Thank you. This thread has reminded me to renew my aopa membership.

You are joking!!! Please dont say that. Apparently my mischief making should have exactly the opposite effect. Well done though, that is exactly what UK needs, and perhaps more poeple to shake the thing up, rather than its usual collection of bury their head in the sand types .

Some good comment at long last regarding their accounts.

They are indeed a strange set of accounts which invite lots of questions, without answers. For example "the other creditors" have increased very significantly. This in theory is monies owed to third parties, not specifically falling under any other category. I wonder why and what it is?

As other have said, there is also a new bank loan, but that seems to have ended up as cash in the bank, and also now a pretty reasonable bank balance, without it being easily apparent why such a balance would be required.

My concern arose from the overall position of the two companies. Depending on what is really behind some of the figures, if you add the net equity together of the two companies, then the position appears far from healty if all the creditors (or more especially the other creditors) called in their debts. I have no doubt there is more to it, and the members may well know, but the accounts do not tell us.

I wonder why the committee didnt have the courage of going to the members if they need more money than going to the Bank, and probably paying significant lending fees and many points above base interest. I assume the Bank will have charged the property anyway, but this also isnt clear (or I may have missed it). Maybe they did, and this is what the other creditors are all about?

At least the auditors havent expressed any going concern issues, so they must be satisfied!

As to it not being a not for profit organisation, that is fair comment, however I think the idea is that it makes enough profit to deal with future projects, future contingency (such as a fall in income for one reason or another) and other contingencies. Running at breakeven year on year is not good for the health. Running at a loss for many years is certainly troubling because that is not sustainable.

Are things going better this year?

Clearly a few new memberships from this thread should help, perhaps I should be checking my PMs for the letter of thanks?

[2Donkeys]

You, just as I, can make lots of assumptions, but they are just that. If it is a short term loan as you suggest and someone wants it back soon, then the actual liquidity will look very different

I try hard not to make too many assumptions. The 270k of 'Other Creditors' falls under Note 8 to the accounts which describes the sum being repayable within 1 year. That makes it a short term loan. Nothing to suggest that it can't be extended in size or repayment period, but that is not what is being booked to the accounts.

I take your point reagrding security, but I have rarely known a bank to lend that sum without security. Who knows, perhaps the bank thinks it is a rock solid bet.

EDIT: Whoops my bad. I see the Barclays does indeed have a charge on 50a Cambridge St. No intrigue over the loan either then.