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ExCo Teleconference. 2018 Financial Report and 2019 Budget Approval Preparing for the Bern ExCo. 22 nd February 2019. Overview. 1) Financial performance 2018. EUR Net result ( profits ) 2018: minus 34.700 Closing balance Common Fund 166.000 .
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ExCo Teleconference 2018 Financial Report and 2019 Budget Approval Preparing for the Bern ExCo 22nd February 2019
1) Financial performance 2018 EUR Net result (profits) 2018: minus 34.700 ClosingbalanceCommon Fund 166.000 Main deviations from 2018 budget: EUR Income shortfall (2 countriesnopay + 1 delayed) 27.700 Additionalexpense: TCP Review + interim OA 81.500 Reducedother operating exp. (secr., advisor, res.fund) 47.700 Reducedinformationexpenses 7.000 Reducedfinancialexpenses 5.100
2) Cash vs. accrual basis accounting 3) Budget flexbility • We propose to «periodize» the DSM accounting • and financialreporting by changing from cash to accrual basis principle, motivated by: • Better alignmentofbudgeting and accounting • Easiermonitoring • More in line with best practice Budget is preparedonthe basis ofknowledgeavailable at time ofbudgeting. TCP internal and externalcondotionsmayrequireredistributions within the budgeted accounts, or necessary additions/reductions in budgeted activities. The Financial sub-committee wishes to keep open the possibility of revising the budget during the budget year, in case unforeseen circumstances make such a revision necessary. Proposed revisions are to be approved by the ExCo. Illustrative effectsofsuchchangeon 2018 result:
4) Budget 2019 - overview Budget 2019 income – payments to Common Fund
Budget 2019 - Expenses Ordinaryexpenses – purchasedworkhours Extraordinaryexpenses Shoudbudgetincludeseed funding? Seed funding is money from the Common Fund to a prospective task Operating Agent to finance work in the concept development phase of a proposed task. If the task commencement is formally approved by the ExCo, and ordinary task funding is secured, the seed money is repaid to the Common Fund. If the task proposal does not pass the subsequent ExCo approval, the seed money is not to be repaid. Before budgeting with seed funding in the 2019 budget, the Financial sub-committee would like to raise a principal discussion in the ExCo on whether or not the ExCo should be offering seed funding from the Common Fund, and if yes: criteria for awarding seed money and (iii) proposed amount to be budgeted for 2019. The final approval of the 2019 budget will need to reflect the ExCo’s position on this issue.
FOR DECISION BY THE EXCO: The IEA DSM Financial sub-committee hereby presents the financial report for 2018 and budget for 2019 to the ExCo with a request to make the following actions and decisions: 1) Instruct the Financial sub-committee on (i) whether or not to include “seed funding” in the 2019 budget, if so: (ii) define criteria for use of the seed fund, and (iii) decide the budgeted amount for 2019. Decision to be reached at the Bern ExCo meeting. 2) Approve that the accrual basis accounting principle is adopted in the Common Fund accounting practice. 3) Approve financial report for 2018. 4) Approve Budget for 2019, including the principle of “budgeting flexibility”, conditional on the outcome of point 1) above.
3a. Updating the Implementing Agreement (KC Michaels) • Current Implementing Agreement (legal text) does not make provisions for a TCP Operating Agent or the separate role of Account Manager • An amended legal text would clarify these roles to better reflect the reality of how DSM TCP operates • Also represents a good opportunity to adjust or amend other provisions to reflect strategic changes, for example if there is a change of name • A few procedures could also be streamlined, for example the change of ExCo representative form currently requires a formal letter to the IEA Executive Director
3a. Updating the Implementing Agreement (KC Michaels) • The ExCo can adopt the Implementing Agreement at any time by a unanimous vote • There is no need for individual Contracting Parties to re-sign the amended legal text • ExCo delegates should look into what procedures would be necessary within their own internal organisations to change the legal text • Once each ExCo representative has determined their internal procedures, the amendment could be approved at a future ExCo meeting • Significant delays in adopting amendments have been experienced in the past owing to the internal processes of one or more members
3b. Changing the name of the TCP? (Sam Thomas) • Proposal: facilitated discussion at Bern ExCo meeting • Purpose: agree TCP’s name for the next strategic period (2020-2025) • Suggested approach: hire external expert to facilitate session in Bern • Invite minimum 3 bids: • ExCo to suggest possible bidders (e.g. Tayburn, WhereWords) • Contractor Sub-Committee to review bids w/c/ March 11? • Pre-meeting homework for all: Two-step process • (i) ExCo delegates send any number of potential new names to Sam • (ii) ExCo delegates rank order all submitted names by preference and send to Sam • (iii) Results shared with contractor ahead of the meeting in Bern • Proposed contractor process: Feb 22nd - April 12th (next slide)
3b. Changing the name of the TCP (Sam Thomas) Questions for the ExCo : • Are you happy with the suggested process? • Do you have any suggestions for potential facilitators to invite to tender?
3c. Draft Agenda for Bern (Sam Thomas) • April 3 DSM Day & OA meeting • April 4 ExCo Day 1 (ExCo, OAs and observers) • Task updates • Task proposals • Task concept notes • OA meeting feedback • Strategy 2020-2025 • Name discussion (part 1) • Dinner • April 5 ExCo Day 2 (ExCo only) • Name discussion (cont) • Comms strategy • Finance, including seed funding discussion • ESC, sub-committees and ExCo OA reports • Actions for the next 6 to 12 months, including preparing for re-launch in 2020 and updating of Implementing Agreement • Question: Any suggested changes to the agenda?
