09.
Finance
Finance
Nautilus continues to be financially strong, robust and viable. The system of internal controls is sound and sufficient to disclose material deficiencies and provide members with reasonable assurance that assets are safeguarded against loss from unauthorised use.
What has been achieved
Finances are kept under regular review and the annual statutory audit is conducted by external chartered accountants, Haysmacintyre LLP, with input from auditors in the Netherlands and Switzerland. The reports resulting from the audit are presented to the General Secretary and management team, the Establishments Committee and the Council for approval. A separate detailed financial report is provided to the General Meeting.
The overriding objective of the finance team, outlined in the department’s Strategic Plan, is to ensure that the Union continues to be independent and financially viable.
The key tools used to ensure that this has been met are:
Annual budgeting
Management accounts
Rolling five-year estimates
Review of the Statement of Investment Policy
Review of the investment portfolio performance
Statutory annual accounts audits and reports
Annual reviewing and setting of membership contributions
Regular and up-to-date cashflow statements
Over the past four years, the finance department has continued to provide the necessary resources to allow other departments to fully discharge their duties in meeting members' needs.
It does so by ensuring that the financial base of the Union is maintained according to the Council’s policy. This includes taking fiscal decisions in advance, maintaining and annually calculating reserves and balancing subscription income and controlling costs.
In addition, rigorous annual budgeting, cost control and tendering processes allow member services to be maintained and adequate financial resources allocated to resolving their legal issues. The Union continues to fund offices in Switzerland, the Netherlands and the UK.
All statutory reports and submissions were completed on time, the accounts duly audited and given an unambiguous, unqualified ‘clean bill of health’ by the Union’s auditors and approved by the Council.
Nautilus’s investment in the UK is operated under the United Nations Ethical Principles for Responsible investment. Nautilus Investment in the Netherlands is under the FNV GBF Ethical Policy.
The Statement of Investment Principles was reviewed for good governance purposes with help from a reputable financial advisor with experience in the charity and not-for-profit sector.
Between 2015 and 2019, Nautilus invested considerable funds into the development of a new website and Customer Relationship Management (CRM) software, both of which are dynamic, agile and nimble, therefore providing better service to members. Both investments have received positive feedback from Nautilus members.
Four Years' Finance at a Glance
For the full and completed audited accounts, please see the full separate report.
| £000 | £000 | £000 | £000 | |
| Income - subs and contribution | 5,521 | 5,997 | 5,930 | 6,132 |
| Income - others | 824 | 740 | 871 | 706 |
| Expenditure - salary & pension deficit | 3,454 | 3,757 | 3,865 | 3,801 |
| Expenditure - others | 2,950 | 3,228 | 3,338 | 3,953 |
| Exchange rate gain/(loss) | (452) | 1,273 | 322 | 151 |
| Total operating surplus/(deficit) | (58) | (248) | (402) | (915) |
| Investment gain/(loss) | 99 | 10 | 198 | 65 |
| (Losses)/gain on revaluation of investment | 349 | 1,109 | 802 | (1,047) |
| Investment holding market value | 15,268 | 17,085 | 17,651 | 15,984 |
| Investment cost value | 13,141 | 14,193 | 14,730 | 14,394 |
| Surplus/deficit to reserves | 329 | 1,204 | 821 | (1,172) |
| Net asset - balance sheet | 15,875 | 17,080 | 17,901 | 16,728 |
Appeal and Donations
Each year Nautilus receives appeals for donations from a wide variety of charitable and like-minded organisations. The procedure agreed by the Council is that the General Secretary has the delegated responsibility and authority to deal with any routine request up to £500.
Any appeal higher than that, or not routine in nature, is referred to the Establishments Committee for approval. However, in the case of emergency appeals from bodies such as UNICEF and the Disasters Emergency Committee, the General Secretary, in consultation with the Chair of Council, can authorise a donation up to £5,000.
The Establishments Committee approves the annual budget for charitable donations and the covenant amount paid into the Charitable Aid Foundation (CAF), which is reviewed every four years and receives regular updates of donations made in between Committee meetings.
Good causes appeals fall into two categories:
Charitable payments: These are to registered charities and made through the CAF account in the name of Nautilus.
Donations: These are made to organisations that are often charitable in nature but are not registered as a charity with the Charities Commission.
Breakdown of total paid, with categories:
| Marine | £40,050 | £13,515 |
| Educational | £18,050 | £13,577 |
| Medical | £3,550 | £2,770 |
| Disaster relief | Nil | £15,270 |
| Aid to third world | £3,800 | £880 |
| Children | £2,300 | £4,940 |
| Age | Nil | £670 |
| Assistance unemployed and families in need | Nil | £1,120 |
Nautilus Welfare Fund
The Nautilus Welfare Fund (NWF) is a separate legal entity, with its own charitable objectives and memorandum.
The NWF is administered by the Union through the UK National Committee, with the Nautilus Council as its managing Trustee and Nautilus Trustees Ltd the Custodian Trustee. The Nautilus Welfare Fund is a charity registered with the Charities Commission for England and Wales number 218742.
Its aims are:
Providing accommodation and, if required, residential or nursing care
Making annual pensions or one-off grants
Providing or paying for goods, services or facilities
Making grants to other people or bodies that provide goods, services or facilities to beneficiaries
Developing new and enhanced services for beneficiaries by means of research or otherwise and, where appropriate, in conjunction with other organisations or individuals
Nautilus Welfare Fund four years' finance at a glance
For the full and completed audited accounts please see the full separate report.
| Income charitable activities | £2,883,868 | £3,618,506 | £3,236,623 | £3,781,346 |
| Charitable expenditure | £2,939,109 | £2,979,328 | £3,081,472 | £3,224,182 |
| Investment gain/(loss) | (264,345) | £617,155 | £532,832 | (732,229) |
| Net movement transfer to reserves | (319,586) | £1,256,333 | £687,983 | (175,065) |
The NWF Committee
The NWF Committee – the Managing Trustees – meets four times a year. It receives the relevant management report, the investment review report, the review of the Statement of Investment Principles, the annual investment manager’s presentation, the annual budget, the five-year rolling estimate and the capital renewal programme from the Director of Finance – during which, the charity’s finances are explained, including any variances and the anticipated outcome.
Over the last four years, the charity has completed the building of both the Trinity House Hub and the Seafarers UK Hub, John Fay House and renewal of bungalows in Cunard Avenue and Ismay Drive, together with the ongoing refurbishment of other properties.
The Council continues to approve the annual budget and approves the annual audited accounts.