annual report 2010
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Annual Report 2010TRANSCRIPT
Annual report Buma/Stemra 2010
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Buma Harpen Gala 2010
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This is Buma/sTemra
The facts:- There is no European market for online music
licenses even though everyone is said to be striving
for a uniform European market.
- The lengthy formation of the cabinet has delayed
the discussion about the renewal of copyright
by a year.
- The exploitation of Phono-Mechanical rights has,
to all intents and purposes, become unfeasible, not
just at Buma/Stemra but also at other societies
in Europe.
- The courts have endorsed that downloads from
illegal sources are allowed under Dutch law.
- The cabinet-Rutte is inflicting cutbacks of c 200
million on Dutch culture, in addition to that
the VAT rate on admission tickets for cultural
performances is going from 6% to 19%.
The opportunities:- Buma/Stemra boasts 20,000 music authors and
with that is a factor of significance.
- It is the copyright organization with proportionately
the highest distribution.
- It goes the furthest to make the exploitation of
copyright for music authors as flexible as possible.
- It has a top 3 position in the field of cost efficiency
among the collecting societies in Europe.
- Buma Cultuur is the most important promoter of
Dutch copyright.
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TaBle of conTenTs
Key figures 6
Buma Five-year plan 8
Stemra Five-year plan 9
Report of the management boards 11
Directors’ Report 15
Buma financial statements for 2010 29
Stemra financial statements for 2010 51
Management boards and directors 71
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Key figures
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2006 2007 2008 2009 2010
106.002 112.770 113.575 119.972 129.432
0102030405060708090
100110120130140
2006 2007 2008 2009 20100
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80
2006 2007 2008 2009 2010
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2006 2007 2008 2009 2010
Turnover development Buma/Stemra Turnover in € millions
Results Buma/StemraResults in € millions
Breakdown of 2010 turnover in percentages – StemraBreakdown of 2010 turnover in percentages – Buma
0.5% Performing Rights Online
Licensing
7.5% Performing Rights Abroad
8.5% Sales outlets
8.7% Cable
12.7% Workplaces
12.1% Catering
14.2% Stage
35.8% Radio & TV Performing Rights
1.4% Mechanical Rights Online
Licensing
9.0% Home Copy / Lending Rights
10.6% Mechanical Rights Abroad
17.7% Special Licensing /
Private Labels
14.4% Radio & TV Mechanical Rights
46.9% Biem Phonomechanical
Rights / Central Licensing
Members and participants
Foreign organisations
Fund for cultural and social purpose
Distribution by Stemra Royalties in € millionsDistribution by Buma Royalties in € millions
Associations and participants
Foreign organisations
Administrative costs deducted
Financial results
Result on ordinary activities
Operating results Stemra (S) Buma (B)
(S)
(B)
48,421 51,576 45,041 40,680 35,662
119,972 129,432 140,004 136,440 140,346
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Staffing levels as per year-end Buma/StemraAs per year end
Turnover segmentation Buma(x € 1,000)
2010 2009 2008 2007 2006
radio & tV performing rights 50,228 51,329 52,541 45,714 42,286Stage 19,899 21,513 20,799 18,249 18,354 Catering 17,015 14,663 14,710 15,744 15,431Workplaces 17,799 13,777 15,215 15,143 12,620 Sales outlets 11,940 11,716 11,901 11,427 10,605 performing rights online licensing 757 893 946 840 564Cable 12,168 12,396 13,035 12,292 11,387 performing rights Abroad 10,540 10,153 10,857 10,023 8,725 140,346 136,440 140,004 129,432 119,972
Turnover segmentation Stemra(x € 1,000)
2010 2009 2008 2007 2006
Biem phonomechanical rights / Central licensing 16,684 18,229 19,866 24,599 23,917Special licensing / private labels 6,306 5,656 8,860 9,930 7,064radio & tV Mechanical rights 5,138 7,266 6,211 5,276 6,124Mechanical rights online licensing 515 1,314 1,219 1,664 1,081Home Copy / lending rights 3,223 3,533 4,184 4,269 4,727Mechanical rights Abroad 3,796 4,682 4,701 5,838 5,508 35,662 40,680 45,041 51,576 48,421
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2006 2007 2008 2009 2010
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Buma five-year planfor 2006 – 2010
Buma five-year plan for 2006-2010(x € 1,000)
2010 2009 2008 2007 2006
Distribution Members and participants 78,925 81,537 80,406 73,015 66,497 Foreign organizations 47,427 44,010 44,336 39,703 42,739
Distributed in the reporting year 126,352 125,547 124,742 112,718 109,236
to be distributed at year-end 162,211 156,536 153,816 151,991 136,798
Turnover 140,346 136,440 140,004 129,432 119,972 Profit and loss account Income 3,357 3,140 3,033 2,709 2,828 expenses -16,919 -16,381 -15,195 -14,659 -14,772 operating result -13,562 -13,241 -12,162 -11,950 -11,944 Financial result 8,496 8,322 -7,782 10,429 9,392 result on ordinary activities -5,066 -4,919 -19,944 -1,521 -2,552 Key index figures total turnover index (2006 = 100) 117.0 113.7 116.7 107.9 100
operating costs index (2006 = 100) 114.5 110.9 102.9 99.2 100
operating costs as % of turnover 12.1% 12.0% 10.9% 11.3% 12.3%
Distributed in the reporting year as % of (turnover last year -/- result on ordinary activities last year) 96.1% 104.6% 97.5% 96.0% 98.8%
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sTemra five-year plan for 2006 – 2010
Stemra five-year plan for 2006-2010(x € 1,000)
2010 2009 2008 2007 2006
DistributionAssociates and participants 31,297 37,989 38,700 46,071 45,444 Foreign organizations 5,453 6,276 8,198 7,946 8,079
Distributed in the reporting year 36,750 44,265 46,898 54,017 53,523
to be distributed at year-end 38,755 40,863 45,438 49,175 51,332
Turnover 35,662 40,680 45,041 51,576 48,421
Profit and loss accountIncome 3,700 4,377 4,728 5,418 5,248 expenses -8,241 -8,975 -9,726 -9,446 -9,652
operating result -4,541 -4,598 -4,998 -4,028 -4,404
Financial result 4,821 4,187 -1,132 4,312 4,325
result on ordinary activities 280 -411 -6,130 284 -79
Key index figurestotal turnover index (2006 = 100) 73.6 84.0 93.0 106.5 100
operating costs index (2006 = 100) 85.4 93.0 100.8 97.9 100
operating costs as % of turnover 23.1% 22.1% 21.6% 18.3% 19.9%
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Financial statements
It is our pleasure to hereby present you with the financial
statements of the Vereniging Buma (Buma Association)
and the Stichting Stemra (Stemra Foundation) for the
financial year 2010. Both sets of financial statements have
been audited by KPMG Accountants N.V. and been issued
with an unqualified report. We recommend you to approve
the financial statements for 2010 of Buma and the financial
statements for 2010 of Stemra, including the board of
directors’ proposals, and to discharge the management
board and board of directors.
Meetings
The management boards met formally six times in the year under review. The Supervisory Board met three times.
During the management board meetings a large number of topics were discussed. All of these topics were dealt with in one or more meetings. Some of them will develop into proposals which will reach the members in 2011. Matters which were discussed concern such things as complaints development, housing, the establishment of the Podcasts working group (in which charges for the use of music in podcasts are determined), the progress that the Pastors working group is making and the start of the joint basic administration (in which the users’ data is shared between Buma and Sena). The management boards have also taken note of the proposals of the College of Copyright Supervision with regard to sound management and transparency. They have considered these proposals in their deliberations.
Flexibility
The management boards have thoroughly gone into proposals to adjust the regulations. This is necessary as the
members have emphatically brought to the fore their desire for making a greater flexibility possible in the way in which royalties are apportioned in the composers part. More and more frequently our rights owners work with so-called co-writes. Several composers and lyricists are then involved in the creation of a musical work. Within the current regulations each writer receives an equal share in the royalties but the desire is that the authors themselves can come to agreements about that, in which the publishers share stays the same. The management boards have also approved a proposal about a so-called Royalty Free Service in which the promotion of own music for non-commercial use on the own website and on CD and DVD may occur free. Furthermore, the management boards have accepted the proposal concerning flexible rights transfer
Online. The appraisal concerning various sorts of use of music was also discussed. It was decided that the Management Committe on Distribution will present a clear proposal in 2011.
The future of Stemra
In the past management year a great deal of attention was given to the future of Stemra. The issue is well-known: the sale of
music carriers is dropping at a high tempo and is not being replaced by income from the use of music on the internet. This latter is the result of a lack of adequate legislation for the protection of copyright in the digital world. Furthermore, the royalties from the commission percentage, according to the Cannes-agreement, Stemra may charge, do not offset the cost of maintaining the administration in a financially justified way . All the sister organizations of Stemra in Europe have the same problem. Even large societies like Gema and MCPS no longer manage to carry out the exploitation and administration of Phono-Mechanical rights in a financially healthy way. The Management Board have had many discussions in the past year to see where favourable solutions lie. It is clear that, no matter what, the administrations are going to have to be combined. There are good arguments, both from the side of the industry as of the societies, to keep up the administration of Phono-Mechanical rights in Europe. The current year should make clear if this leads to a long-term solution in which a healthy operational management of this administration is ensured.
Politics
One of the matters which has started to move is that the Ministry of Justice has published a rough draft of Authors
Rights Contracts. The only concrete step that has been taken in European, the context is that the European parliament accepted the Gallo-Report at the end of September. This report recognizes the problem of the illegal use of music, for instance, on the internet and the fact that measures must be taken against this. It is now a question of waiting to see what the European Commission is going to do with the recommendations of the report. We anxiously await State Secretary Teeven’s spearhead memorandum, which was announced in 2010, in which the position of copyright in the digital world will also be discussed.
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Social-Cultural
In several management board meetings the deduction percentage for social-cultural was discussed. The balance
that is available for this purpose must, for instance, be able to cover the (conditional) obligations that the fund entered into. Furthermore, the annual allocations and withdrawals are brought in balance. Therefore it was decided to reduce the deduction percentage in three steps from 10% to 8%.
The organization
The promotion of the importance of copyright and the role that Buma plays in this as well as implementing the PR-
policy have been on the agenda several times. The management boards decided, after lengthy deliberation, to set up a PR & Communication department for both Buma Cultuur and Buma. The management boards have ascertained that the policy of Buma Cultuur as formulated in 2009 has successfully been taken up in 2010 with vigour. During the managerial discussions on the budget and allocation for Buma Cultuur, specific support of certain genres, such as jazz was also discussed. In the light of the development of the outlook for Buma Cultuur, attention will also be given to the way in which genres, which are commercially interesting and those which are not are supported, also partly in relation to any possible pay back opportunities of an event on the one hand and cultural aspects on the other. The management boards have also spoken about the possibility of undertaking the activities of Musi©opy.
Second phase outsourcing
In accordance with the original decision making concerning outsourcing, the board of directors started the second phase of
the outsourcing project in the second half of 2010. In this phase the operations are transferred from Prague to India. As of 2011 operations for Buma/Stemra in Prague ceased and all activities take place under the responsibility of Accenture in India.
The General Members’ Meeting
The Joint General Members’ Meeting of the Vereniging Buma (Buma Association) and the Meeting of Affiliates of the
Stichting Stemra (Stemra Foundation) took place in Amsterdam on May 17, 2010. As introduced in 2009 the public part again had a number of workshops and seminars with various topics that are of interest to the visiting rights owners. At the meeting the financial statements of Buma and Stemra were presented by Mr Cees Vervoord for the last time in his capacity as chairman of the Board of Directors and he gave his explanatory remarks on the implemented policy.
The members gave their approval for the financial statements of Buma 2009 and the financial statements of Stemra 2009 and discharge management board and board of directors for the implemented policy. Also the meeting agreed to an age limit and term of office for members of the management board of Stichting Stemra (Stemra Foundation), the Supervisory Board and the management Committees. This means the upper age limit of candidates is fixed at 70 years. At the meeting the upper limit of the term of office for the Supervisory Board was fixed at three terms of a maximum of 4 years. The age limit for the management board at Buma remains unchanged.
Appointments
On March 22, 2010 an extra general members meeting took place. The meeting agreed to the appointment of Mr Hein
van der Ree as chairman of the Board of directors of Buma/Stemra. Mr Cees van Rij was appointed by the meeting as statutory co-director and vice-chairman of the board. The Joint General Members’ meeting of May 17 elected Mr Tom Peters as a member of the management board and reappointed Mr Maurice Mensink and Mr Paul van Brugge. The Meeting of Affiliates elected Mr Jochem Gerrits as a member of the management board of Stemra and re-elected Mr Hans Kosterman and Mr René Smit. During a reception at Artis on June 19 Buma/Stemra bid farewell in an appropriate way to Cees Vervoord as chairman of the board of directors. Mr Vervoord held this position from 1994 to May 2010. During the festive gathering Mayor Spekreijse of Lochem pinned on the decoration which goes with his appointment as Companion of the Order of Oranje-Nassau. The management boards realize that the organization under the leadership of the new chairman of the board of directors is faced with a heavy task. The organization is in a precarious phase in an environment in which copyright is respected less and less and in which the income position of rights owners and affiliates is continually being meddled with. However, the board of directors know however that they are confident of an organization that with the greatest possible degree of scrupulousness and efficiency does its work, as the figures in the financial statements show. The management boards of Buma and StemraHoofddorp, April 6, 2011
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inTroducTory remarKs
At the end of 2010 an amount of c 162.2 million is
available for distribution to Buma rights owners. This is
well over c 5 million more than there was to distribute at
the end of 2009. At Stemra has per the end of 2010 an
amount of c 38.8 million to distribute compared to c 40.9
million at the end of 2009.
Whereas the turnover of Buma has risen, Stemra has been
deteriorating for a succession of years, 2010 was no
exception to this. Not just Stemra, but all the other societies
in Europe have great difficulty in financially maintaining the
exploitation of Phono-Mechanical rights. Therefore intensive
consultations are taking place with societies in order to
come to a common solution.
At the moment of writing this annual report the final details
are being settled for a new Cannes-agreement. With that the
compensation percentage for Phono-Mechanical rights
remains virtually unchanged. This agreement is valid up to
and including 2013 and offers some repose regarding the
compensation percentage that Stemra can count on.
The Key figures 2010
General
Turnover Buma increases, Stemra decreases
The state of affairs per product sector at Buma and
Stemra provided a higher turnover at Buma in 2010 and,
once again, a substantially lower turnover at Stemra. In
general. The increase in turnover at Buma is partly the result
of a number of settlement of accounts with music users
which also relate to preceding years.
Settlement of accounts from preceding years plays a decisive role in the achieved turnover
In general licenses, Buma (catering, stage, work and sales
outlets) the economic crisis has, for the second successive
year, clearly had an impact on the turnover invoegen of
Buma. Especially catering has been considerably hard hit,
which is apparent in an increase in bankruptcy cases. Fewer
music users also means less contributions to Buma.
Also the turnover at Stage ar below expectations. The
organizers of great events have achieved substantially lower
turnover through the lack of large acts in 2010. In former
years performances by artistes as U2, Madonna, Coldplay,
but also those of Marco Borsato and Guus Meeuwis were
great sources of income, in 2010 there were significantly less
of this kind of event. The fact that the decrease at Stage
remained limited and nevertheless generated a turnover of
c 19.9 million, is due to the extra efforts of the increase of
small-scale and often one-off events. In 2010, for the first
time, technology, which automatically traces websites that
have information about events, was used to track and
investigate relevant performances.
The advance of cable viewers disappointing
In the Cable sector we see that in the past two years more
and more more households have switched to a form of digital
television. At the end of 2008 that applied to approximately
50% of families, in 2010 that percentage increased to 62%. The
remaining part use a satellite dish or have a connection with
a telephone company. For Buma/Stemra the growth in the
number of subscribers to cable television on digital channels
is especially of importance, the advance last year lapsed
disappointingly. The majority of cable viewers still watch
analog channels. This is an important fact because this leads
to the redistribution of turnover among the groups of rights
owners in the cable collective. Through this the share for
Buma will decrease. Moreover, because the consumer price
index was negative per January 1, 2010, no growth could be
realised by means of the index adjustments.
Broadcasting companies provide far fewer mechanical recordings than formerly
One would assume that through the growing use of music
on radio and television that here, of all places, the turnover
would increase. On the other hand however, broadcasting
companies record much fewer broadcasts for the long-term.
This has to do with other technical storage systems in
which music is called up from a central server.
Consequently far fewer copies of each musical work are
recorded. Also the broadcasts themselves are recorded in
another way. More and more frequently the music, for
example for a television documentary, is removed in storage.
This also leads to a diminished contribution, because, in
this way, no Stemra-license is necessary for the recording of
own productions.
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In 2010 the Dutch entertainment market once again disappointing
In 2010 the income from the use of music on the internet
remained zero, this as a result of the lack of protection of
copyright in the digital world. Furthermore, at the end of
2009, the Online sector was negatively affected by the
discontinuation of the charges for background music. In
addition to this in 2010 it was decided not to charge
websites for embedded content, in view of the discussion
about a definite regulation for this form of online use of
music. Another important reason of the large decrease of
income in the Online sector is the fact that various
publishers have withdrawn their mechanical rights from
almost all societies. Through this, the income from both
existing and new streaming and download contracts have
been more than halved.
The market disappoints
The Dutch entertainment market in 2010 was once again
disappointing. The sales and turnover, both in money
and numbers, taken as a whole, have dropped by more than
10 per cent in nearly all the product groups.
The whole market dropped by 12.7 per cent and consequently,
ended up for the first time under the turnover level of c 1
billion. In 2009 a turnover of c 1.1 billion was achieved,
whereas in 2010 this amounted to c 970.6 million. The music
market shrank by well over 15 per cent to c 218.1 million. In
2009 this turnover was still c 258.4 million. Only the sales of
digital albums and digital singles rose by respectively
22.7 and 4.7 per cent. The above-mentioned, emerged from
figures that trade association NVPI published at the
beginning of 2011. Analysis of the figures show that the
national product has done relatively well. The success
of Caro Emerald, Marco Borsato, Nick & Simon and Jan
Smit have contributed to this.
New Cannes agreements
After months of delays a new Cannes agreement,
Cannes-III, was established in 2010. This encompasses
retroactively the years 2009 and 2010. The agreement
regulates the percentages which the societies for Phono-
Mechanical rights may retain as remuneration for their
administrative activities and distribution of royalties. The
two parties involved, are the international music publishers
on one hand and the organizations for Phono-Mechanical
rights in West Europe on the other. In both years Stemra
obtained a compensation percentage of 7.325 for this
turnover category. For the first time the operation of the
Cannes agreement has been extended to music DVDs. A
higher compensation percentage has been agreed on for
this, namely 9.325 per cent, because more rights owners are
involved in this and it means a more complex
administration for the societies.
New Cannes agreement entered into for the period up to 2013 inclusive
At the beginning of 2011 the final negotiations were
conducted for the Cannes-IV agreement. The new agreement
will last for a period of three years, from January 1, 2011 up to
and including December 31, 2013. As regards the percentages
Cannes-IV will be a virtually unchanged continuation of
Cannes-III. This new agreement means that there will be
certainty for three years about the compensation percentage
on which Stemra can count on.
Hereafter, it is described how the above-mentioned factors
have affected the figures for Buma and Stemra for 2010.
Buma
With a turnover of c 140.3 million in 2010 the royalties
from copyright exploitation have come out slightly
higher than that of the record year 2008. It is too premature
to draw the conclusion from this that Buma is once more on
the growth path, after the slight relapse of 2009 (turnover
c 136.4 million).
In the largest sector, Performing Rights Radio & TV, the
turnover has decreased slightly to c 50.2 million compared
to c 51.3 million in 2009. With this it is maintaining the level
of last year when a non-recurring income was still
incorporated in the turnover. Also in the Stage sector there
is a question of a decrease, of c 21.5 million in 2009 to
c 19.9 million in 2010.
Turnover Buma has risen to over d 140 millionThe turnover of the Catering sector increased by c 2.3
million from c 14.7 million in 2009 to c 17.0 million in 2010.
This is remarkable in view of the economic recession in
catering. The higher turnover also chiefly has to do with the
settlement of accounts over a number of years. Furthermore
marketing was intensified and the joint invoicing which was
set up with other collecting societies (CSs) under the name
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SCAN resulted in an increase in the number of invoices. The
Workplaces sector also achieved a higher turnover. Also here
it is a question of one-off income from preceding years
through which the turnover figures stand out favourably
compared to preceding years. The turnover increased from
c 13.8 million in 2009 to c 17.8 million in 2010.
The Sales Outlets sector achieved a practically unchanged
turnover of c 11.9 million in 2010 (2009: c 11.7 million). The
sector Performing Rights Online Licensing turnover
decreased to c 757,000 compared to c 893,000 in 2009.
The Cable sector realised a turnover of c 12.2 million
compared to c 12.4 million in 2009. In Performing Rights
Abroad the turnover increased slightly to c 10.5 million
(2009: c 10.2 million). A positive boost came from the extra
use of tunes & jingles from Dutch music creators by
European broadcasting stations.
Stemra
The decrease in turnover at Stemra was not brought to a
halt in 2010. Whereas in 2009 c 40.7 million income was
secured, in 2010 it was c 35.7 million. The greatest decrease
was at Mechanical Rights Radio & TV, with a turnover of c 5.1
million in 2010 compared to c 7.3 million the year before. The
largest sector is Phono-Mechanical rights Biem/Central
Licensing. Here the turnover was c 16.7 million (2009: c 18.2
million). The decline is directly connected to the caving in of
the sale of physical music carriers.
The annual decline last year was still somewhat compensated
by the unexpected sale of Michael Jackson CDs.
Slump in turnover chiefly through decrease at Radio & TV
With the amount of c 6.3 million the Special Licensing/Private
Labels sector booked a slightly higher turnover (2009: c 5.7
million). The income from Mechanical Rights Online
Licensing was decimated from c 1.3 million in 2009 to
c 515,000 in the year under review. Here we see the
consequences of the fact that the large music publishers have
taken away the exploitation of their repertoire for online from
the European societies, and therefore also from Buma/
Stemra. However, the most important cause of the decrease
in turnover is the lack of a earning model for use of music on
the internet. In Homecopy/Lending Rights the turnover is
dependent on a third party. This went down to c 3.2 million
(2009: c 3.5 million). Mechanical Rights Abroad noted a
decrease from c 4.7 million in 2009 to c 3.8 million in 2010.
The development of the results
The revenue from investments is of important value in
the financial foundation of the organization. The
practice of investing available funds under conditions, came
into effect on the basis of a management decision in the
nineties. The management board was confronted with the
fact that funds which the organization receives from the
exploitation of rights cannot immediately be distributed to
the rights owners. The administration needs time to gather
all data and to arrive at a correct distribution. It often takes
many months before certainty is gained about the exact use
of musical works by licensees, certainly if it concerns users
overseas. In the last decade of the previous century it
became clear that it was more sensible, under conditions, to
invest received funds that were waiting for distribution,
rather than just paying them into a, mediocre yield, deposit
account. That applied then, and it still does now. To that end
an investment policy was formulated in which many risks
were reduced. On the understanding that of course no
investment is completely without risk.
Shares and bonds are valued in the balance sheet against
the prices on the stock exchange on the balance sheet date.
The results derived from this are incorporated in the
revaluation reserve. As far as the balance of the revaluation
reserve permits, in addition to the dividend received on
shares and – from 2006 – in addition to the received interest
on the fixed interest portfolio, a so-called standard return
can also be entered in the financial results. This
methodology fits in with the objective of Buma/Stemra that
the well-considered investment results on shares and fixed
interest securities over the years show as constant as
possible course in the operating statement.
Since then the revenue from the investments is used to cover a
considerable part of the costs of the organization . In retrospect
it can be ascertained that this, against the background of the
compensation which societies received for their activities, was
a wise decision. The administration costs which we at Stemra
can charge within the framework of, among others, the
Cannes-agreement have not covered costs for years.
In the meantime the investment proceeds have become a
stable second source of revenue. They contribute to the fact
that, of the European societies, Buma has the lowest level of
costs year after year and consequently also the highest
distribution ratio. The following record reflects the netto costs
as percentage of the achieved turnover in the year 2009 (figures
for 2010 are not yet available):
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Buma operates with the lowest cost percentages in the branch
The results of the investments is entered in the profit and
loss account of Buma and Stemra under the item financial
results.
Profit and loss account Buma
Besides the reported turnover from the exploitation of
rights of c 140.3 million in 2010, revenue was also
received of c 3.4 million (2009: c 3.1 million). This revenue
partly emanated from the administrations of other
collecting societies which Buma takes care of.
The expenditure at a higher turnover has largely remained
unchanged and came to c 16.9 million. In 2009 the
expenditure amounted to c 16.4 million.
The exploitation result amounted to c 13.6 million negative
(2009: c 13.2 million negative). The financial results
(including the changes revaluation) improved slightly and
amounted to c 8.5 million (2009: c 8.3 million), as a result of
which ultimately c 5.1 million costs were debit to the
turnover compared to c 4.9 million in 2009.
Before Buma goes on to the distribution of the collected
funds, after processing revenue and expenditure, a portion
is added to the Fund for Social and Cultural purposes. This
occurs in accordance with a decision of the management
board which is reconfirmed each year. The addition for 2010
is fixed at 8.5% (2009: 9%) of the amount of the Netherlands
royalties available for distribution. With that the allocation
amounted to c 10.2 million (2009: c 10.4 million).
Profit and loss account Stemra
The turnover of Stemra in year under review, amounted
to c 35.7 million, once again a sharp decline compared
to 2009 (c 40.7 million). Also the revenue went down and
amounts to c 3.7 million (2009: c 4.4 million). In comparison
to expenditure of c 8.2 million (2009: c 9.0 million). From this
an exploitation result of c 4.5 million negative remains. In
2009 this was c 4.6 million negative. The financial result
(including the revaluation changes) amounts to c 4.8 million.
What remains is a result from ordinary activities of
c 280,000 positive compared to c 411.000 negative in 2009.
This result will have an influence on the financing of the
negative appropriated reserve which was set up in 2008.
Stemra has completely redeemed the loan from Buma
Balance Buma and Stemra
An important decision which has an influence on the
balance of both Buma and Stemra is that in the year
under review, Stemra completely redeemed the loans from
Buma and BSO/BSA for a total of c 55.7 million. This amount
is deducted from the current account with Stemra.
disTriBuTion
General
In two years’ time Buma hopes to celebrate its 100th
anniversary. The Vereniging Buma (Buma Association) was
founded in 1913 by composers and music authors who, with
the advent of the radio, were not able to monitor the use of
their musical works themselves. For that purpose they
founded the Vereniging Buma (Buma Association) to whom
they handed over the exploitation of their Performing
Rights.
When later on the sale of records and other music carriers
also boomed, the association members set up the Stichting
Stemra (Stemra Foundation). Stemra targeted on the
exploitation of Phono-Mechanical rights. Later the minister
of Justice deemed Buma as the sole collecting society which
may deal with the exploitation of music rights in The
Netherlands. Since then the organization has worked under
the supervision of the Ministry.
The exploitation of rights and the collection and distribution
of the resulting royalties from that is the most important
task of the organization. It is important to realise that the
distribution which is justified each year in the annual report,
relates to what is distributed to rights owners in the year
under review, primarily on the basis of the turnover royalties
which were realised the year before.
Buma has as per December 31, 2010 an amount of c 162.2
million on the balance that is available for distribution,
Stemra has an amount of c 38.8 million. The distribution of
this will largely take place in 2011.
The distribution for Buma which took place in October 2010,
is related to the amount that was available for distribution
to the rights owners on December 31, 2009. For Buma that
was c 156.5 million and for Stemra c 40.9 million.
20 AnnuAl report 2010 ã ContentS
AnnuAl report 2010 | Buma/Stemra 21
phot
o: M
ike
Bre
euw
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Go Back to the Zoo
ã ContentS
22 AnnuAl report 2010 ã ContentS
For Buma the available amount for distribution has risen, for Stemra it has fallen
Distribution Buma once again higher
At the beginning of the year under review there was
c 156.5 million to distribute. In addition to this, during
2010 an amount of c 132.0 million became available for
distribution. From that, the amount that was distributed in
2010 is deducted. On balance at the end of 2010 c 162.2
million is available for distribution to the rights owners of
Buma. This is largely distributed in 2011. The construction of
these amounts is described in the Notes on the balance of
Buma on page 42 of this annual report.
Distribution Stemra is lower
At the beginning of the year under review there was an
amount of c 40.9 million to distribute. During 2010 an
amount of c 34.6 million is available for distribution. From
that, the amount that is distributed in 2010 is deducted. On
balance at the end of 2010 c 38.8 million is available for
distribution to the rights owners of Stemra. This is
distributed in 2011. This is nearly c 2 million less than the
comparable amount over 2009. The composition of these
amounts is described in the Notes on the balance of Stemra
on page 62 of this annual report.
The only turnover online that is not increasing is that of music
Protection of copyright
The expectation from years ago that legal downloads
would amply surpass the sale of physical carriers has,
for the time being, turned out to be an illusion. As far as that
is concerned, the Netherlands is one of the most infamous
music markets in the world. Research by the organization of
the international record industry, IFPI, over 2010 shows that
the online market in The Netherlands is bringing up the rear
in Europe and the world. Whereas, in Denmark and Great-
Britain respectively, approximately 25 per cent and 20 per
cent of the music sales take place online, in our country it is
only 6 to 8 per cent. For the whole of Europe this percentage
is on average, 15 per cent of the turnover. By way of
comparison: in the US currently 43 per cent of the music
sales take place online. PriceWaterhouseCoopers has
another relevant observation about the Dutch market. They
observe that the music sales are steadily dropping and that
this is in sharp contrast with the turnover which internet
service providers realise and the amounts that are spent on
advertising and direct mailings on internet. Each year since
2006 these numbers are again substantially higher than
those of music sales.
The efforts of tracing organization BREIN to trace as many
sites as possible which distribute music without licences
and to have legal action taken are indeed successful but still
very troublesome. BREIN (a collaboration of rights and
producer organizations in our country) manages to take
effective action against online infringements of copyright,
but for each shut down illegal website a few new
alternatives crop up.
Home Copying Scheme frozen
In Dutch copyright it states that the copying of music is
allowed provided that this is done for own use or for study
purposes. To compensate the rights owners for this the
legislator devised the Home Copying Scheme, based on a
compensation on blank carriers and other objects which can
be used to store music. Through this music authors,
composers and publishers were somewhat compensated
financially for the loss of income which they suffered as a
result of the Homecopy exception. There are two major
problems with this scheme.
In the Home Copying Scheme the recordable CD is the most modern music carrier
In the first place the scheme has not been adjusted anymore
since 2003. Since then the rights owners have, to no avail,
been zealous advocates of the implementation of the Home
Copying Scheme on modern music carriers such as
MP3players, smart phones, hard disc recorders, memory
sticks, recordable DVDs and other new recording media. But
last year, via an Order in Council, the government froze the
scheme for another three years. Not only has the scale of
charges been left unchanged, but also modern music
carriers fall outside the scheme for another three year. The
compensation is imposed on carriers which are hardly ever
sold anymore. The income from the Home Copying Scheme
is, not surprisingly, also halved.
Bill on supervision pushed through
This year the parliamentary considerations over the bill
that regulates the supervision of the collecting societies
direcTors’ reporT
AnnuAl report 2010 | Buma/Stemra 23 ã ContentS
must be rounded off. It is certain that the bill will mean an
expansion and strengthening of government supervision.
Discussion in parliament about the future of copyright delayed by one year
Authors Rights Contracts
Another political topic caused a lot of turmoil in 2010.
During the summer a rough draft for the regulation of
the Authors Rights Contracts was made public. With this
regulation the Netherlands wants to follow the example of
a number of other European countries, where it appears to
work well. The rough draft outlines the rules which must
be observed when entering into contracts between authors
and the exploitant of his work. With this the legislator
wants to improve the negotiating position of the author in
relation to the licensee. The regulation will not just apply
to music authors but for the creators of all works protected
by copyright. Licensees are, according to Authors Rights
Contracts, not just the recording companies, but also
broadcasting companies, software companies, publishers,
film and television producers etc.
The proposal Authors Rights Contracts jeopardizes publishers’ investments in acts
Brussels
In the meantime Europe is becoming more important by
the day for national copyright and for the regulating of the
exploitation and administration of this right. It must be
stated that the European Commission in 2010 has also not
yet taken action to get a clear picture of European copyright
in the digital age, let alone that an effective regulation is
reached. While technology is racing like a storm through the
various sectors, the music author is left to fend for himself.
neW iniTiaTives
FlexCo further fleshed out
In 2010 the concept of FlexCo became more concrete.
Flexible Collective Management is an initiative that meets
the desire of rights owners to be able to deal more flexibly
with the transfer of rights to Buma/Stemra. In particular
young composers and lyricists want to be able to exploit
their music themselves via internet. There is already a pilot
running with Creative Commons. In the past year it was
decided that music authors have the possibility to do the
online exploitation of their works whether or not carried out
by Buma/Stemra. In the latter case the exploitation risk
comes to lie by the rights owner. This means for example
that Buma/Stemra will no longer take action against sites
that make illegal use of their works. The members meeting
of May 2011 will receive a proposal about this.
Buma Works hard on greater flexibility for rights owners
Another part where Buma/Stemra offers more flexibility is
allowing variant distributions. Now it is so that in the Buma/
Stemra regulations fixed distributions are employed. For an
increasing number, in particular younger authors and
composers the fixed distribution is no longer satisfactory.
Hits are more and more frequently co-writes; the sum of
contributions from various authors. Within the current
regulations more authors can be registered for a work, but
in that case they each receive an equal percentage of the
Buma share. The members meeting of May 2011 can look
forward to a proposal in which it is possible that within the
authors share variant agreements can be made among the
authors themselves.
collaBoraTion
Pastors working group: concrete agreements
Pastors working group made good progress in 2010 and
moreover achieved important results. The working
group, officially Working Group Improvement Collection
Royalties, was started in 2008. Within the working group
consultations between the collecting societies and the
business community take place, combined in VNO/NCW
and MKB The Nederland (Small and Medium Sized
Enterprises the Netherlands). In 2010 a great amount of
work was accomplished.
Pastors Working group achieves important results
24 AnnuAl report 2010 ã ContentS
The working group is engaged in five matters:
1. The setting up of a central basic registration. The aim is
that copyright organizations arrive at a joint database
with all the user data. At the closing of this annual
report the planning was that the basic registration will
go ahead in spring 2011. This starts in any case with
Buma, SENA and Videma. Also other organizations can
join this.
2. Joint negotiating. Via mutual understanding from both
CSs and user-representatives to endeavour to establish
parameters and make regulations. Thus a new regulation
for live-performances was thoroughly discussed. This
has also come into being.
3. Disputes and complaints settlement. A number of
preparations have been made, but the definite
interpretation of the regulation will depend on the
Supervision of Collecting Societies Act which must be
dealt with in parliament within the foreseeable period.
4. A hallmark for rights organizations. Definite agreements
have been made about this. Buma meets the
requirements.
5. Electronic invoicing. This was realised at the beginning
of 2010 with the start of the Service Centrum Authors-
and Naburige Rights (Service Centre Copyright & Related
Rights) (in short “SCAN”).
In December the working group decided to freeze the
charges for 2011. So that this year a number of sensitive
discussion points can be settled in peace and quiet, such as
the adjustment of the parameters by Buma and SENA plus
the adjustment of charges so that they are better attuned to
the requirements in the market. The working group has
given itself time till October 1, 2011 for this purpose, so that
the business community knows in time which changes
come into effect in 2012.
Tasks transferred to SCAN
Except for one production function all the tasks of the
department Individual Licences of Buma have been
transferred to the Stichting Service Centrum Authors and
Naburige Rights (Service Centre Copyright & Related Rights)
SCAN. SCAN does not serve as a new rights organization but
acts purely as an administration service centre for various
rights organizations. At the moment these are Buma, SENA
and Videma. On behalf of these three organizations SCAN
now takes care of the administration, invoicing and collection
for music licences.
SCAN has been in operation since 2008. In 2010 it further
improved and supplemented the joint database. Last year
SCAN consisted of 60,000 accounts. In 2011 it will reach
100,000 accounts. Furthermore, in 2010 for the first time, the
invoicing was done jointly. It was found that SCAN
contributes to greater efficiency in the administrative process.
The aim is that as many as possible rights organizations and
music users place their invoicing and collection with SCAN as
a result of which the costs per invoice for the participating
CSs can decrease. In addition, this year the field organizations
from the participating organizations will be combined.
SCAN grows to 100,000 accounts this year
The organiZaTion
Social-Cultural: allocation of € 10.2 million
The most important task of the social-cultural activities
of the organization is the promotion of Dutch music and
the arrangement of a supplementary pension for rights
owners. The activities are financed from the allocation to
the Funds for Social & Cultural purposes. The level of the
addition to this fund comes from the agreements which
were made within the CISAC, the international umbrella for
Copyright organizations.
In the financial year 2010 c 10.2 million (2009: c 10.4 million)
was added to the fund. As a percentage of the turnover this
is 8.5% compared to 9% in 2009. The management board has
namely decided that in the case of growth of the turnover,
Buma does not have to automatically stay the addition at
the same percentage of the turnover.
The aim is to bring Buma to the attention of the public, politics and industry the whole year longIn 2010 Buma Cultuur received from this addition c 3.6 million.
The “Toeslag Ernstig” (Surcharge Serious), the provision which
is used for supporting of activities in the category Serious
Music, amounted to c 2.4 million in 2010. Other cultural
objectives were assigned c 0.7 million.
Furthermore in 2010 c 3.9 million was assigned to support the
social objectives of the organization. It concerns the Buma
Social Fund that was assigned c 1.5 million. To Other Social
c 2.4 was distributed. For this item it concerns contributions on
behalf of the AENA superannuation scheme and the Publishers
superannuation scheme.
direcTors’ reporT
AnnuAl report 2010 | Buma/Stemra 25 ã ContentS
Buma Cultuur (Buma Culture) reaches its targets
In 2010 Buma Cultuur implemented its policy plan 2009 -
2012. Buma Cultuur’s aim is to promote and support
Dutch music copyright in the broadest sense. With this the
organization has a unique place in the Dutch cultural
climate, in which music from The Netherlands takes up an
increasingly important role. In foreign countries the
attention for music from The Netherlands is greater than
ever. Buma Cultuur has been able to contribute a lot to this.
Broadening of the field of activity
Buma Cultuur streamlined its own organization in 2010
to be able to work more efficiently and effectively. This
has led to a broadening of the initiative package, so that all
the relevant genres are supported and illuminated. Buma
Cultuur sees it as its task to make certain that rights owners
have the feeling that the cultural activities are relevant and
actually supportive of the genres in which they are active.
The genres that Buma Cultuur concentrates on, are:
1. Dutch -language (Folk)
2. Pop/rock/alternative
3. Dance/urban/world-music
4. Jazz/cabaret/contemporary/applied music/World-music
One of the first priorities in 2010 was the broadening of the
field of activity. This led to the launching of two new events,
BUMA NL and Buma Rotterdam Beats. BUMA NL is the
showcase-festival for Dutch language songs. For two days
BUMA NL, with more than 500 professionals and artistes,
formed a cross section of Dutch language music and the
Dutch language industry. The BUMA NL Award show drew
a large public.
Buma Rotterdam Beats is the new showcase and seminar
event for Dutch urban music, a genre that produces many
hits and with which Dutch composers score internationally.
Buma Cultuur successfully launches two new events
Bonds with media partners
Another priority in 2010 was the expansion of the
collaboration with media partners at various events.
Thus the Buma Harpen Gala in 2010 was, for the second
time, broadcast live by the TROS. Also BUMA NL and Buma
Rotterdam Beats received a lot of media interest. The
collaboration with media partners at other large events as
Eurosonic Noorderslag, the Amsterdam Dance Event and
the Annie M.G. Schmidtprijs is enhanced and extended.
Thus Buma on Tour was extensively heard on 3FM. There
were also many sets to be heard on this station from DJs
who performed during the 15th Amsterdam Dance Event.
The whole year through Buma Cultuur will create media
attention and couple the name Buma to as many media and
programmes as possible. In addition, Buma Cultuur is
setting its sights at calling attention in public opinion, in
politics and industry to Dutch music and music copyright.
Buma Cultuur is aiming with that not just at the
professionals but also at the public at large.
Focus on top-marketing
Finally Buma Cultuur has discontinued a number of
activities because allocation of resources was not optimal
or the coupling to its own objective got insufficient attention.
Thus participation in Music Export was stopped. Instead of
that Buma Cultuur targets on top-marketing support, the
promotion abroad of authors who have already built up a
reputation in the Netherlands. Buma Cultuur does not pay
towards the costs of artistes tours abroad but offers support
with the promotion to do with it. It consequently has more
the character of sponsoring than subsidizing. In exchange for
this the artistes promote Buma, in interviews and other
things. In this way in 2010 acts such as Caro Emerald and
Wouter Hamel are effectively supported. The tightening up of
the policy was also noticeable at the Buma Harpen Gala held
in March 2010. The accent at the Gala was more on the music
author and composer than on the performing artiste. Also
the publicity that the event drew was extremely great. Thus
both the NOS News and the RTL News devoted a lot of space
to the Buma Harpen Gala, both in the broadcasts on the
evening of the presentation as in the morning broadcasts the
day after. Also many other programmes, such as RTL
Boulevard, dedicated various items to the event. The 2011
edition which was held on March 3 had as a new element
that it was no longer a professional jury that awarded the
prizes, but the Buma-Affiliates themselves.
DisputesThe Arbitration board
Since 2006 rights owners at Buma/Stemra with
complaints concerning decisions from the Board
of Directors and management board can invoke a
dispute. A special Arbitration board makes a ruling about
the complaint.
26 AnnuAl report 2010 ã ContentS
The Arbitration board is made up of three members who are
appointed by the members meeting of Buma/Stemra. The
Arbitration board consists of an independent chairman (a
lawyer in the field of copyright), and two Buma/Stemra-
rights owners. The Disputes settlement is accessible to all
authors and music publishers who are affiliated to Buma/
Stemra. With that the Arbitration board of Buma/Stemra is
the professional body for a rights owner with a concrete
complaint about a decision from the management board
and the board of directors through which he/she
individually and directly is affected in his/her interests. The
ruling of the Arbitration board serves parties as a binding
recommendation, unless the judge in a concrete case rules
differently. In 2010 the Arbitration board made a ruling in
two matters. In the one case the Arbitration board decided
in the complainant’s favour and in the other case not. In
both cases it was about the implementation of the double
claim procedure when two rights owners claim the same
(part of a) work.
The Standing Committee on Plagiarism (SCP) The Plagiarism Committee makes simple settlements of
disputes possible. Currently five musicologists and two
professors serve on the SCP. The SCP came into being in 1967
as an extra service to our members. The background is that
members who are in dispute with each other about the
origin and originality of a musical work do not immediately
have to turn to the courts. In the meantime the SCP has
turned out to be an extremely useful addition to the service
of Buma/Stemra; the procedure is efficient, fast, practical
and relatively inexpensive.
In 2010 the SCP dealt with two complaints. In both cases it
was established that there was no question of plagiarism.
Mediation
As of 2010 Buma/Stemra facilitates, under certain
conditions, the possibility of solving disputes via
mediation. At least one of the parties involved must be a
Buma/Stemra rights owner and Buma/Stemra itself should
not be a party in the conflict.
To the present day no use has yet been made of the above-
mentioned possibility.
Musi©opy at Stemra
Stichting Musi©opy (Musi©opy Foundation) intends to
cease its activities in 2011. Stemra has offered to carry
on the activities of Musi©opy. Through this one service desk
comes into being for collective music arrangements at the
Stichting Stemra (Stemra Foundation).
Since 1995 Musi©opy has served the interests of music
authors and music publishers in the field of the copyright
aspects of song texts and musical notations, and the
licensing of the re-use of these works. Musi©opy had too
little income to be able to work as a professional
organization. Furthermore, it was difficulty for them to
reach the choirs, brass bands, orchestras and wind and
percussion bands. Buma/Stemra has the necessary systems
which makes the administration easier and more efficient.
In addition to this our organization can draw on contacts
with the groups mentioned.
With the activities of Musi©opy, Stemra can offer interested
parties an extra service. At the moment of writing, the
agreement with all the large interested parties is not yet
completely finalized, as a result of which the take-over
of Musi©opy is not yet definitely settled.
Licenses for online use of music possible
Since May 2010 music users at Buma/Stemra can also apply
online for licences for online use of music. Consequently,
we are able to offer our clients more ease and efficiency and
achieve greater transparency. Most users of this service
currently come from the world of webcasting: the live
broadcasting of image and sound material via internet.
Through this new service these users can also arrange their
licences themselves.
PINO realises ultimate goal
The term PINO became an important term in 2010 for all
rights owners and affiliates. PINO stands for Paper Is No
Option: the name of the operation which was started in 2009
to make communication with members, including the
settlement of accounts, completely digital. In 2010 the project
was successfully rounded off. 95 per cent of the affiliates
receive their data via internet. The remaining five per cent
mostly consists of older people who have no computer or
who find it troublesome to deal with. They, of course, still
receive their pieces by post.
direcTors’ reporT
AnnuAl report 2010 | Buma/Stemra 27 ã ContentS
a looK ahead 2011
The current year promises, on various points, to give
more clarity. If we look at the political front, then State
Secretary Teeven will come with his bill concerning the
supervision of collecting societies. Also the report of the
Gerkens committee will be dealt with in the Lower House of
the Dutch Parliament and the Authors Rights Contracts is on
the agenda.
In Brussels a lot of interest is shown in the new directive
from the European Commission concerning copyright and
the online possibilities of exploiting musical works. Though
whether the directive will see the light this year is still the
question.
2011 promises to be the year of clarity
The future of Stemra is also waiting for clarity this year.
Consequently, the current talks with “sister” organizations
in Europe and the publishers are of overriding importance.
Only if we succeed in bundling administrations is the
exploitation of Phono-Mechanical rights feasible in the
long term.
Three factors are important for the turnover which can be
achieved this year. The first is that a new Cannes-agreement
is entered into for a duration of three years up to and
including 2013. Therein, the international music publishers
assent to a virtually unchanged deduction percentage for
the exploitation of Phono-Mechanical rights.
The second factor is that at the beginning of 2011 an
agreement is reached on a new contract with Koninklijke
Horeca The Netherlands (Royal Dutch Catering).
The third factor is that as of December 31, 2010 the contracts
with the commercial tv-stations, NPO and Kabel expire. The
negotiations about that, which began last year, will have to
be wrapped up this year.
Achieving results is determined by whatever requirements
the cabinet stipulates for the investment policy of the CSs.
To all appearances it looks as if the room to invest will be
limited. If that happens, then the investment revenue is no
longer an extra source of income to cover the costs and is
therefore also no longer a stable cornerstone under our
financial household. That will again be to the cost of the
height of the distribution to rights owners.
The strategy of Buma/Stemra is aimed at:
• Lobby for legislation for the protection of copyright in
the digital world
• Enhancing service direction (improve complaints
process)
• Improved and more frequent communication with our
members, extension portal functionality)
• Maintaining the position as licenser of the world
repertoire
• Maximization of the turnover
• Top-3 position amongst the CSs in Europe in the field of
cost efficiency
• The strategy of Stemra focusing on the creating
international collaboration with as aim the efficient
administration of Mechanical Rights
With the steps that we have taken in 2010 and taking into
consideration the expected market circumstances we
anticipate being able to further realise these strategic targets
in 2011.
The Board of directors Buma/Stemra
Hein van der Ree (chairman)
Cees van Rij
Wieger Ketellapper
Hoofddorp, April 6, 2011
28 AnnuAl report 2010 ã ContentS
AnnuAl report 2010 | Buma/Stemra 29
financial sTaTemenTs for 2010 Buma
toonzetters 2010
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30 AnnuAl report 201030 AnnuAl report 2010 ã ContentS
Buma Balance sheeT
Buma balance sheet as per 31 December 2010After appropriation of the result (x € 1,000)
31 December 2010 31 December 2009*
asseTs Fixed assets
Intangible fixed assets (1)
Company information system - 40
- 40
Tangible fixed assets (2)
Hardware/computer equipment 414 683
other operating assets 90 121
504 804
Financial fixed assets (3)
Securities 202,846 159,781
202,846 159,781
Current assets
Accounts receivable
Debtors 8,151 4,528
Current account balances (4) 2,619 47,052
taxes and dividends 344 966
other receivables and prepayments (5) 9,261 10,898
20,375 63,444
Cash at bank and in hand (6)
Deposit accounts 16,944 23,030
other cash at bank and in hand 18,912 3,179
35,856 26,209
259,581 250,278
liaBiliTies
reserves
Continuity reserve (7) 1,855 2,367
Appropriated reserve (8) - -3,253
Revaluation reserve for financial fixed assets (9) 10,796 9,878
12,651 8,992
Provisions (10) 11,174 12,275
23,825 21,267
Long term liabilitiesFund for cultural and social purposes (11) 17,168 17,557
17,168 17,557
Current liabilitiesroyalties to be distributed (12) 162,211 156,536
Creditors 6,237 6,922
Current account balances (13) 45,884 43,402
taxes and social security contributions 405 303
other accruals and deferred income (14) 3,851 4,291
218,588 211,454
259,581 250,278
* Adjusted for comparison
AnnuAl report 2010 | Buma/Stemra 31 ã ContentS
Buma profiT and loss accounT
Buma profit and loss account for 2010 (x € 1,000)
2010 2009*
income
Administrative costs charged 2,151 1,940
entrance fees and annual allowances 604 549
other income 602 651
3,357 3,140
expenses
personnel expenses (15) 8,151 8,150
Housing expenses 1,141 1,160
Depreciation and amortisation 406 656
other expenses 7,221 6,415
16,919 16,381
operating result -13,562 -13,241
Financial result (16) 8,496 8,322
result on ordinary activities -5,066 -4,919
exceptional income 512 -
exceptional expenses -512 -
Result -5,066 -4,919
Result appropriationresult allocated to appropriated reserve 3,253 3,254
result deducted from royalties to be distributed -8,319 -8,173
* Adjusted for comparison
32 AnnuAl report 201032 AnnuAl report 2010 ã ContentS
Buma cash floW sTaTemenT
Buma cash flow statement(x € 1,000)
2010 2009*
Cash flow from operating activitiesturnover 140,346 136,440
Distribution incl. administrative costs charged -126,352 -125,547
Changes in Fund for cultural and social purposes -389 -512
operating result -13,562 -13,241
Depreciation and amortisation 406 656
Investment costs, including charge-ons 175 346
Changes in indemnification obligation 15 23
Changes in provisions -1,116 -607
Withdrawal from continuity reserve -512 -
Changes in accounts receivable (excl. Interest due) 43,312 -602
Changes in current liabilities (excl. royalties to be distributed) 1,459 1,378
44,771 776
Cash flow from business operations 43,782 -1,666
Interest received on securities 5,578 7,069
Financial expenses - -527
Interest paid on securities -314 -420
5,264 6,122
Cash flow from operating activities 49,046 4,456
Cash flow from direct investment activitiesInvestments in tangible fixed assets -240 -175
Cash flow from investing activities -240 -175
Cash flow from indirect investment activitiespurchase of securities -84,670 -28,883
repayments/sales 45,511 39,236
Cash flow from indirect investment activities -39,159 10,353
Changes in cash at bank and in hand 9,647 14,634
* Adjusted for comparison
AnnuAl report 2010 | Buma/Stemra 33 ã ContentS
general
Buma Association’s objectivesThe Association aims to promote both the material and
immaterial interests of authors and music publishers, with
its ensuing activities taking place on a non-profit basis.
The Association participates in the implementation and
promotion of various activities in this context to achieve
its objective.
Principles for the valuation of assets and liabilities and determination of the resultThe principles adopted for the valuation of assets and
liabilities and determination of the result are based on
historical costs unless otherwise explained.
Unless stated otherwise, assets and liabilities are stated at face
value. Income and expenses are allocated to the period to
which they apply.
The figures of 2009 are re-classified for comparison (with the
figures of 2010).
Accounting principles for the translation of foreign currencyTransactions denominated in foreign currency are translated to
euros at the applicable exchange rate on the transaction date.
Monetary assets and liabilities denominated in foreign
currency are translated to euros at the exchange rate applicable
on balance sheet date. Exchange rate differences are taken to
the profit and loss account. Non-monetary assets and liabilities
denominated in foreign currency that are valued on the basis
of historical costs are translated at the applicable exchange
rate on the transaction date.
Principles of consolidationIn view of their transparent structure, Stichting Buma/Stemra
Obligatiefonds and Stichting Buma/Stemra Aandelenfonds are
included in the Buma financial statements by means of
proportional consolidation. Assets and liabilities, as well as
income and expenses, are included in proportion to the
participating interest. On the basis of the information provided
in the notes, no separate financial statements for Buma are
included.
Intangible fixed assetsThe intangible assets concern the expenses for the new
business information system to support the primary business
processes. These are valued at historical cost less cumulative
investment expenses or amortisation. These investments
are charged to the profit and loss account over a period of
three years.
Tangible fixed assetsThe valuation of tangible fixed assets takes place on the basis of
historical cost less cumulative depreciation.
Depreciation is calculated as a percentage of the purchase price
according to the straight-line method on the basis of the expected
useful life.
The following expected useful life terms are used:
• Hardware/Computer equipment 3 years
• Other operating assets 3 - 7 years
Accounts receivableAccounts receivable are stated at nominal value less a
provision for bad debts.
Financial fixed assets The securities included under financial fixed assets are listed
shares, bond funds, and (convertible) bonds. Securities are
stated at market value as at balance sheet date.
Revaluation reserve for financial fixed assets Price gains/losses arising from the valuation of securities at
market price are not directly taken to the trading account, but
are first included in the revaluation reserve for financial fixed
assets (hereinafter: ‘revaluation reserve’). To the extent that the
revaluation reserve is insufficient, the deficit is charged to the
result.
Each year, the size of the revaluation reserve needed to absorb
price fluctuations is determined by the management board in
consultation with its asset managers. If the revaluation reserve
is larger than deemed necessary, this surplus is eligible for
addition to the royalties to be distributed.
Financial result and standard returnDividends are accounted for in the period in which they are
made payable, interest income is accounted for in the period to
which it relates.
Insofar as the balance of the revaluation reserve, less a possible
appropriate reserve for (un)realised gains or losses arising
from changes in market prices, leaves room for this, a ‘standard
return’ is included in the financial result, in addition to any
receivable share dividend and interest on bond funds. In the
calculation of the standard return, the dividend and interest
already paid out are taken into account, and only the difference
between the dividend/interest received and the standard
return is settled with the revaluation reserve.
The standard return is calculated as a percentage of the
average value of the shares and bond funds over the financial
noTes To The Buma Balance sheeT and profiT and loss accounT
34 AnnuAl report 201034 AnnuAl report 2010 ã ContentS
year, and comprises the effective return on 5-year euro
government bonds at the end of the financial year plus a risk
mark-up for shares. The difference between the standard
return and the dividend received on shares or interest received
on bond funds is withdrawn from the revaluation reserve,
if possible.
Due to progressive changes in legislation and regulations, the
system of applying a standard return is no longer regarded as
a generally acceptable principle.
However the system of standard return fits in with the
requirement that the recorded investment results on shares
and fixed-income securities show the most even development
possible in the profit and loss account over the years. For this
reason the management board and directors have decided to
continue the system of standard return.
Continuity reserve The continuity reserve’s aims include guaranteeing the
continuity of the work. It also serves to fulfil obligations in
respect of third parties, in particular with regard to distribution
of the royalties yet to be distributed in accordance with the
financial statements. This reserve furthermore serves to level
out unwanted fluctuations in the amounts available for
distribution, resulting, among other things, from domestic and
international pressure on turnover, as well as continuing
changes in the distribution of rights.
Fund for cultural and social purposesFor the benefit of this fund, in accordance with Article 29(3) of
the Articles of Association, each year a percentage defined by
the management board on the recommendation of the board of
directors, with a maximum of 10%, is deducted from the Dutch
royalties available for distribution.
The amounts deducted are reserved by the management board
for payments to institutions or organizations whose purpose
is to represent the idealistic or material interests of composers,
lyricists and music publishers, or who otherwise promote
Dutch music. The fund for cultural and social purposes is
classified as liability, because the fund is never available to
the organization.
Appropriated reservesAppropriated reserves are the parts of reserves that
management has set aside for a special purpose. In this case,
it concerns the appropriated reserve for (un)realised gains/
losses arising from changes in market prices. For more detailed
information on this appropriated reserve, please refer to the
notes to the balance sheet.
ProvisionsProvisions are measured at either the nominal value of the
estimated expenditure required to settle liabilities and losses,
or the present value of that expenditure.
A provision is mentioned in the balance sheet when there is:
• a legal or constructive obligation as a result of a past
event, and
• of which a reliable estimate can be made, and
• it is probable a cash outflow is necessary to settle the
obligation.
The provision for reorganization costs is related to the estimated
costs of redundancy.
The long-service awards provision is a provision for future
long-service awards. The provision is the present value of future
benefits to be paid for long-service awards.
Determination of the resultIncome and expenses are accounted for in the year to which
they apply. The result is determined by calculating the
difference between the balance of realised income and
expenditure and the financial result for the year. The balance
of the profit and loss account is allocated/deducted from the
royalties to be distributed and/or the reserves by means of
profit appropriation.
Financial expensesThe operating costs of the system for the collection of
programme data, Fingerprinting, are no longer classified as
financial expenses, but from 2010 directly charged to the
operating result.
Pension plansObligations for contributions to defined contribution pension
plans are recognised as an expense in the profit and loss account
when the contributions are due.
Turnover In the financial statements, the turnover in royalties is added
to the royalties distributed. Buma includes the exploitation of
performing rights in turnover, insofar as these relate to the
financial year, can be determined in a reliable manner, and
there is reasonable certainty that the revenue is collectible.
TaxWith regard to Buma, the Dutch tax authorities stipulated in an
agreement dated November 6, 2001, determining the legal
relationship between the parties, that Vereniging Buma is liable
to pay corporation tax. This agreement was extended at the
end of 2008 for a period of three years, and is valid until
noTes To The Balance sheeT and profiT and loss accounT
AnnuAl report 2010 | Buma/Stemra 35 ã ContentS
December 31, 2011. Foreign withholding tax available for set-off
and Dutch dividend tax may be deducted from the tax due by
virtue of this agreement determining the legal relationship
between parties. A tax item is only included in the financial
statements if corporation tax is still owed after deduction of
the foreign withholding tax available for set-off.
Accounting principles for cash flow statementThe cash flow statement is drawn up using the indirect method.
Use of estimatesDrawing up the financial statements requires management to
form opinions and make estimates and assumptions that
influence the application of principles and the reported value
of assets and liabilities, and of income and expenses. The
estimates and the associated assumptions are based on past
experience and various other factors that are considered
reasonable in view of the circumstances.
The outcome forms the basis for the opinion on the carrying
value of assets and liabilities that does not emerge clearly from
other sources.
The actual results may differ from these estimates.
36 AnnuAl report 201036 AnnuAl report 2010 ã ContentS
noTes To The Buma Balance sheeT as per 31 decemBer 2010
Business information system
Actual cost as per 1 January 2010 6,958
Cumulative investment costs -6,918
Balance sheet value as per 1 January 2010 40
Changes during financial year:
Investments -
Amortisation -40
-40
Actual cost as per 31 December 2010 6,958
Cumulative amortisation -6,958
Balance sheet value as per 31 December 2010 -
Amortisation in number of years on average: 3
(1) Intangible fixed assets The changes in the intangible fixed assets can be specified
as follows
(x € 1,000)
AnnuAl report 2010 | Buma/Stemra 37 ã ContentS
Hardware/ Other
Computer- operating-
equipment assets Total
Actual cost as per 1 January 2010 3,085 5,263 8,348
Cumulative depreciation -2,402 -5,142 -7,544
Balance sheet value as per 1 January 2010 683 121 804
Changes during financial year:
Investments 207 33 240
Depreciation -476 -64 -540
-269 -31 -300
Actual cost as at 31 December 2010 3,292 5,296 8,588
Cumulative depreciation -2,878 -5,206 -8,084
Balance sheet value as per 31 December 2010 414 90 504
Depreciation in number of years on average 3 7
the depreciation accounted for in the statement of
movements is partly charged on, as the assets in question
are used by Stemra or sub-tenants. the amounts charged
on to Stemra and the sub-tenants is for both € 0.1 million.
(2) Tangible fixed assetsThe changes in the tangible fixed assets can be specified
as follows: (x € 1,000)
38 AnnuAl report 201038 AnnuAl report 2010 ã ContentS
2010 2009
Balance sheet value as per 1 January 159,781 157,608
Changes during the financial year:
Acquisitions 84,670 28,883
repayments / sales -45,511 -39,236
price movements 3,906 12,526
43,065 2,173
Balance sheet value as per 31 December 202,846 159,781
(3) Financial fixed assetsThe changes in the financial fixed assets can be specified as follows:
(x € 1,000)
Securities
31 December 2010 31 December 2009asseTs
Fixed assets
Financial fixed assets 254,006 251,695
Other assets 15,823 73,440
269,829 325,135
liaBiliTies
Participants’ account 269,395 324,752
Current liabilities
Creditors 434 383
269,829 325,135
the fully-combined Financial statements of Stichting Buma/Stemra Obligatiefonds (BSO) [Buma/Stemra bond Fund Foundations] and
Stichting Buma/Stemra Aandelenfonds (BSA) [Buma/Stemra equity Fund] can be represented in condensed form as follows:
(x € 1,000)
noTes To The Buma Balance sheeT as per 31 decemBer 2010
Securities and bonds of Vereniging Buma are carried at market value.
Valuation differences on bonds and shares are charged or
credited to the revaluation reserve for financial fixed assets.
the total face value of the bonds amounted to € 47.6 million (2009:
€ 41.9 million) compared to a market value of € 49.1 million (2009:
€ 42.3 million). the reduction in the face value of € 41.9 million to
€ 47.6 million is on the one hand the effect of the conversion of part
of the fixed-income securities to bond funds and on the other hand
an increase in interest in the Stichting Buma/Stemra obligatiefonds
of 16.4%. this increase of 16.4% is the result of the sale of
participations by Stemra worth € 69.5 million (repayment of loan
in current account to Buma € 55.7 million, repayment of loan in
current account to BSo and BSA € 13.3 million, increase cash Stemra
€ 0.5 million).
Buma’s securities have been placed in Stichting Buma/Stemra
obligatiefonds and Stichting Buma/Stemra Aandelenfonds. the
foundations are proportionally consolidated in Buma’s financial
statements at an average percentage of 79.9% (2009: 63.5%).
At the end of 2010 the interest is changed from 63.5% to 79.9%.
For the result implies that the percentages are used as applied for
2010 (63.5%). the participations give Vereniging Buma a 79.9%
(2009: 63.5%) interest in Stichting Buma/Stemra Aandelenfonds
and a 79.9% (2009: 63.5%) interest in Stichting Buma/Stemra
obligatiefonds at year end 2010.
AnnuAl report 2010 | Buma/Stemra 39 ã ContentS
(5) Other receivables and prepayments
(x € 1,000) 31 December 2010 31 December 2009
Cable fees due 5,782 5,086
Interest due 1,160 917
other receivables and prepayments 2,319 4,895
9,261 10,898
(6) Cash at bank and in handFor the rent of the office building, a bank guarantee has been issued for
€ 0.5 million. All the other cash at bank and in hand is freely available.
(7) Continuity reserveThe changes can be specified as follows 2010 2009(x € 1,000)
As per 1 January 2,367 2,367
Allocations - -
Withdrawals -512 -
As per 31 December 1,855 2,367
During the year a withdrawal is made that refers to the completion
of the streamlining of the organization which started in the previous
years. the withdrawal of € 0.5 million was recognized through the
profit and loss account (exceptional income and expenses).
(8) Appropriated reserveThe changes can be specified as follows: 2010 2009(x € 1,000)
As per 1 January -3,253 -6,507
Allocations 3,253 3,254
Withdrawals - -
As per 31 December - -3,253
(4) Current account balancesthe loan of € 55.7 million (2009 € 43.8 million) from Buma to
Stemra is completely redeemed and is reduced on the current
account balance with Stemra. the loan is subject to the euribor
three-month rate.
Further notes about the settlement of this current account balance is
mentioned at the financial fixed assets.
€ 6.5 million of the negative result in 2008 is set aside by means
of result appropriation by the management board and the board of
directors in the appropriated reserve, in order to not fully settle the
effects of the stock exchange decline in 2008 with the 2008 collection
year. In accordance with the intention of 2008, 50% of the appropriate
reserve of 2008 was balanced with the distributions of the 2009
collection year and the remaining 50% is settled with the distributions
of the 2010 collection year.
40 AnnuAl report 201040 AnnuAl report 2010 ã ContentS
Provision for long-service awardsthe provision for long-service awards is a provision for future long-
service awards, calculated on the basis of actuarial assumptions with
regard to indexation and life expectancy.
Provision for reorganization coststhe expectation is that the provision for estimated severance
payments will largely be settled in 2011.
Provision for SFB scheme annual allowancethe provision for annual SFB allowances concerns a provision for the
actual obligations by virtue of the annual allowances paid to (former)
authors and publishers and their next of kin through the Stichting
Sociaal Fonds Buma (SFB).
Although the obligations have been included provisionally, there is
a firm intention to meet the obligations. the part of the provision
for which no subsidy has been committed to the SFB as yet is
recognised. the expected remaining term of the provision is until the
end of 2022, and it has been calculated on the basis of the nominal
amounts of the annual allowances with non-actuarial assumptions
with regard to indexing and life expectancy. the provision was
formed from the Fund for cultural and social purposes; releases are
part of the deductions and taken to the Fund.
Provision for obligation to indemnifyAs a party to the agreements concluded with cable operators
concerning copyright arrangements for relaying programmes from
broadcasting companies, Buma has undertaken obligations with
regard to copyright claims that could be enforced against cable
operators by third parties, not represented in the matter by Buma.
In respect of obligations to indemnify arising from these agreements,
the provision for obligations to indemnify amounts to 3% of the
monies collected. the addition/withdrawal takes place to the debit/
credit of the collection.
noTes To The Buma Balance sheeT as per 31 decemBer 2010
(9) Revaluation reserve for financial fixed assetsThe changes in the revaluation reserve for financial fixed assets can
be specified as follows: 2010 2009(x € 1,000)
As per 1 January 9,878 -
(un)realized gains/losses arising from price changes 3,907 12,526
Withdrawal to the credit of the financial result to standard return -2,989 -2,648
As per 31 December 10,796 9,878
(10) ProvisionsThe changes in the provisions can be specified as follows:
(x € 1,000) Balance as per Additions Withdrawals Balance as per
1 January 2010 2010 2010 31 December 2010
long-service awards 419 198 -198 419
reorganization costs 157 - -18 139
SFB scheme annual allowance 11,133 - -1,098 10,035
obligation to indemnify 566 581 -566 581
12,275 779 -1,880 11,174
the (un)realized gain in securities amount to € 3.9 million (2009:
12.5 million) and are taken directly to the revaluation reserve for
financial fixed assets. the results on shares, (convertible) bonds and
bond funds are stated at a standard return. the percentage for 2010
was 6.2% (2009: 6.6%) for shares and for fixed-income securities 3.7%
(2009: 4.1%). the withdrawal for the benefit of the financial result at a
standard return was € 3.0 million (2009: € 2.6 million).
AnnuAl report 2010 | Buma/Stemra 41 ã ContentS
the withdrawal from the available amount to be allocated for
distribution of royalties in the netherlands and the resulting addition
to the Fund is set by the board of directors at 8.5% (2009: 9%).
€ 10.7 million of the total fund has a short term characteristic.
2010 2009
As per 1 January 17,557 18,069
Allocations 10,212 10,395
Withdrawals -10,601 -10,907
As per 31 December 17,168 17,557
(11) Funds for cultural and social purposes
The changes can be specified as follows:
(x € 1,000)
42 AnnuAl report 201042 AnnuAl report 2010 ã ContentS
2010 2009
royalties to be distributed at the beginning of the year 156,536 153,816
royalties turnover 140,346 136,440
Changes in royalties to be distributed -8,319 -8,173
Available for distribution 288,563 282,083
Distributed in the reporting year:
Members and participants 67,440 69,943
Foreign organizations 46,549 43,269
Fund for cultural and social purpose 10,212 10,395
Administrative costs charged 2,151 1,940
Distribution incl. administrative costs charged 126,352 125,547
Royalties to be distributed at the end of the year 162,211 156,536
of the available amount to be processed for distribution in 2011,
€ 4.7 million will be added to the indivisible rights (2009: € 4.5
million, distributed in the 2010 payment).
the negative result for 2010 amounts to € 5.1 million (2009:
€ 4.9 million negative). In accordance with the decision of 2008,
€ 3.3 million was allocated to the appropriated reserve and
€ 8.3 million (2009: € 8.2 million) was deducted from the royalties
to be distributed.
(12) Royalties to be distributed (x € 1,000)
2010 2009
royalties turnover 140,346 136,440
Indivisible rights 4,715 4,469
Changes in royalties to be distributed -8,319 -8,173
Became available for distribution during the year 136,742 132,736
to be distributed at the beginning of the year 156,536 153,816
Available * 132,027 128,267
Distributed -126,352 -125,547
Royalties to be distributed at the end of the year 162,211 156,536
*Excluding indivisible rights which have already been accounted
for in the opening balance sheet
Available for distribution Buma(x € 1,000)
noTes To The Buma Balance sheeT as per 31 decemBer 2010
AnnuAl report 2010 | Buma/Stemra 43 ã ContentS
2010 2009
radio & tV performing rights 50,228 51,329
Stage 19,899 21,513
Catering 17,015 14,663
Workplaces 17,799 13,777
Sales outlets 11,940 11,716
performing rights online licensing 757 893
Cable 12,168 12,396
performing rights Abroad 10,540 10,153
140,346 136,440
Distribution of Buma’s turnover(x € 1,000)
2010 2009
live entertainment 16,335 18,407
Mechanical entertainment 38,345 32,138
radio 5,868 5,848
television 7,637 7,556
Film 2,403 1,965
Serious categories 3,222 3,219
Cable 10,859 10,982
Satellite 31,321 32,073
International 10,540 10,153
Fund for cultural and social purposes 10,212 10,395
136,742 132,736
The amount available for distribution (including addition for indivisible
rights) is allocated to the different categories as follows:
(x € 1,000)
44 AnnuAl report 201044 AnnuAl report 2010 ã ContentS
31 December 2010 31 December 2009
Sister companies abroad 26,064 25,464
Specific obligations 14,719 14,210
Buma members and participants 752 613
Current account Stemra 949 -
other 3,400 3,115
45,884 43,402
(13) Current account balances (x € 1,000)
the amounts owed to sister companies abroad were largely settled
at the beginning of 2011.
the specific obligations are obligations to foundations with
social-cultural purposes:
• Buma Cultuur € 5,309 (2009: € 4,317)
• AenA € 5,071 (2009: € 5,265)
• Sociaal fonds Buma € 4,339 (2009: € 4,628)
31 December 2010 31 December 2009
third-party cable right owners 1,882 2,848
Holiday allowance/annual leave 793 754
other liabilities and accruals 1,176 689
3,851 4,291
(14) Other liabilites and accruals(x € 1,000)
noTes To The Buma Balance sheeT as per 31 decemBer 2010
AnnuAl report 2010 | Buma/Stemra 45 ã ContentS
off-Balance sheeT commiTmenTs
Partially pledged bond portfolioIn accordance with the decision of the management board, at the
end of 2002, part of the bond portfolio of Stichting Buma/Stemra
obligatiefonds amounting to € 27.5 million was pledged as security
to InG Bank n.V. in connection with a cash facility needed for normal
operations.
Longterm financial liabilitythe financial liability with regard to the business accommodation in
Hoofddorp was entered until April 30, 2012.
the annual rent for Buma/Stemra together amounts to € 1.9 million
of which approximately 40% will be charged to third parties.
In the current composition, the annual amount for the leasing of cars
by Buma/Stemra is € 0.3 million. the liability for terms longer than
one year is € 0.4 million.
the financial liability for the rent of the printers was entered until
May 1, 2013. the annual rent amounts to € 0.1 million.
Buma/Stemra entered into a contract allowing Accenture to perform
a large portion of Buma/Stemra’s back office activities from 2007
until March 31, 2017. the resulting financial obligation amounts to
€ 18.2 million for the remaining duration of the contract, assuming
consistent volumes.
the off-balance sheet commitments of € 21.5 million can be
summarised as follows:
• less than 1 year: € 5.1 million
• between 1 and 5 years: € 15.7 million
• longer than 5 years: € 0.7 million
46 AnnuAl report 201046 AnnuAl report 2010 ã ContentS
2010 2009
Salaries 8,473 7,868
Social security contributions 1,030 940
pension contributions 1,032 862
other personnel expenses 2,652 3,207
13,187 12,877
Charged /compensated to third parties -5,036 -4,727
8,151 8,150
expenses
(15) Personnel expenses (x € 1,000)
the average number of employees during the reporting
year was 173 employees (2009: 165 employees) which
corresponds to an average of 166.5 Fte (2009: 154.6 Fte).
this includes:
• average 4 employees (2009: 1 employee) are charged to SCAn, which corresponds
to an average of 4.0 Fte (2009: 0.8 Fte)
• employees who work partly for Stemra, on the basis of which part of the costs are
charged on to Stemra
• 1.0 Fte which is charged to other affiliated foundations
Salary management board Buma and registered Directors Buma/Stemra for the year 2010 (x € 1,000)
Management BumaFee for 12 members of the management board Buma
(incl. expense allowance) € 95.4
Registered Directors Buma/StemraH.G. van der ree salary € 200.0
(from May 1, 2010) pension charges € 40.4
C. van rij salary (incl. variable reward) € 233.9
pension charges and car € 55.2
C.p. Vervoord, former chairman
of the board of Directors salary (incl. variable rewards) € 379.2
(till August 1, 2010) pension charges € 56.1
of the amounts mentioned above 70% is recognized in the financial statements of Vereniging Buma and 30% in the financial statements of
Stichting Stemra.
In preparing the financial statement until 2009 we used the exemption under Article 383 paragraph 1, title 9 BW2.
noTes To The Buma profiT and loss accounT for 2010
AnnuAl report 2010 | Buma/Stemra 47 ã ContentS
2010 2009
Interest income and other incomeFixed-income securities
Interest received on bonds 1,605 1,957
Shares
Share dividend received 3,509 3,755
5,114 5,712
Mutations revaluation reserve
Withdrawal from revaluation reserve for the benefit
of the financial result at a standard return 2,989 2,648
other interest income and similar income 707 909
total income from investments 8,810 9,269
Financial expenses - -527
Interest expenses and other costs -314 -420
8,496 8,322
(16) Financial result(x € 1,000)
Financial expensesthe operating costs of the system for the collection of programme
data, Fingerprinting, are no longer classified as financial expenses,
but from 2010 directly charged to the operating result.
48 AnnuAl report 201048 AnnuAl report 2010 ã ContentS
oTher informaTion
To: The Board of Directors and the general meeting of affiliates to Vereniging Buma
independenT audiTor’s reporT
We have audited the accompanying financial statements 2010
of Vereniging Buma, Hoofddorp, which comprise the balance
sheet as at December 31, 2010, the profit and loss account for
the year then ended and the notes, comprising a summary of
the accounting policies and other explanatory information.
Management’s responsibility Management is responsible for the preparation of the financial
statements in accordance with the accounting policies selected
and disclosed by the entity, as set out in the notes to the
financial statements. Furthermore, management is responsible
for such internal control as it determines is necessary to enable
the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
Auditor’s responsibilityOur responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in
accordance with Dutch law, including the Dutch Standards on
Auditing. This requires that we comply with ethical require-
ments and plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s
judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to
fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation
of the financial statements in order to design audit procedures
that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of
the entity’s internal control. An audit also includes evaluating
the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by mana-
gement, as well as evaluating the overall presentation
of the financial statements.
We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our
audit opinion.
OpinionIn our opinion, the financial statements are prepared, in all
material respects, in accordance with the accounting policies
selected and disclosed by the entity, as set out in notes to the
financial statements.
Basis of accounting and restriction on distribution and useWe draw attention to notes to the financial statements, which
describes the basis of accounting. The accounting policies used
are selected and disclosed by the entity. Our opinion is not
qualified in this respect.
Amstelveen, April 6, 2011
KPMG ACCOUNTANTS N.V.
R.J. Groot RA
AnnuAl report 2010 | Buma/Stemra 49 ã ContentS
suBsequenT evenTs
Profit appropriationFor Buma, the result for 2010 will be deducted from the
royalties still to be distributed.
Then, according to the assessment of the reserve, it will be
determined to what extent funds will have to be added to
or deducted from this. This movement will also be credited
or charged to the royalties to be distributed.
Proposal of the board of directorsAs shown in the financial statements, which we prepared in
accordance with Article 26(2) of the Articles of Association,
the board of directors proposes deducting c 8.3 million of the
negative result of c 5.1 million from the royalties to be
distributed and allocating c 3.3 million to the reserve. (in
accordance with the decision made in 2008).
The proposal has already been incorporated in the 2010
financial statements.
50 AnnuAl report 2010 ã ContentS
AnnuAl report 2010 | Buma/Stemra 51
financial sTaTemenTs for 2010 sTemra
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sTemra Balance sheeT
Stemra balance sheet as per 31 December 2010After profit appropriation (x € 1,000)
31 December 2010 31 December 2009*
asseTs
Fixed assets
Tangible fixed assets (1)
Hardware/computer equipment 210 224
210 224
Financial fixed assets (2)
Securities 51,159 91,915
51,159 91,915
Current assets
Accounts receivableDebtors 4,868 2,791
Current account balances (3) 4,180 2,512
taxes and social security contributions 885 1,762
other receivables and prepayments (4) 288 426
10,221 7,491
Cash at bank and in hand (5)
Deposit accounts 2,781 12,724
other cash at bank and in hand 3,524 1,924
6,305 14,648
67,895 114,278
liaBiliTies
Reserves
Foundation capital 1 1
Continuity reserve (6) 5,760 5,929
Appropriated reserve (7) - -1,300
Revaluation reserve financial fixed assets (8) 5,561 5,683
11,322 10,313
Provisions (9) 213 379
11,535 10,692
Current liabilitiesroyalties to be distributed (10) 38,755 40,863
Creditors 932 986
Current account balances (11) 4,618 49,643
other accruals and deferred income (12) 12,055 12,094
56,360 103,586
67,895 114,278
* Adjusted for comparison
AnnuAl report 2010 | Buma/Stemra 53 ã ContentS
sTemra profiT and loss accounT for 2010
Stemra profit and loss account for 2010(x € 1,000)
2010 2009
income
Administrative costs charged 3,096 3,828
entrance fees and annual allowances 604 549
3,700 4,377
expenses
personnel expenses (13) 5,018 4,951
Housing expenses 761 774
Depreciation and amortisation 270 437
other expenses 2,192 2,813
8,241 8,975
operating result -4,541 -4,598
Financial result (14) 4,821 4,187
result from ordinary activities 280 -411
exceptional income 169 -
exceptional expenses -169 -
Result 280 -411
Profit appropriationresult allocated to appropriation reserve 1,300 1,300
result deductions from continuity reserve - -721
Changes in royalties to be distributed -1,020 -990
54 AnnuAl report 201054 AnnuAl report 2010 ã ContentS
sTemra cash floW sTaTemenT
Stemra cash flow statement(x € 1,000)
2010 2009
Cash flow from operating activitiesturnover 35,662 40,680
Distribution -36,750 -44,265
operating result -4,541 -4,598
Depreciation and amortisation 270 437
Investment costs, including charge-ons -99 -270
Changes in provisions -166 -51
Withdrawal from continuity reserve -169 -
Changes in accounts receivable (excl. interest due) -2,868 -583
Changes in current liabilities (excl. royalties to be distributed) -45,118 10,121
-47,986 9,538
Cash flow from business operations -53,779 1,471
Interest received on securities 3,299 3,570
Financial expenses - -132
Interest paid on securities -709 -704
2,590 2,734
Cash flow from operating activities -51,189 4,205
Cash flow from direct investment activitiesInvestments in tangible fixed assets -157 -102
Cash flow from investing activities -157 -102
Cash flow from indirect investment activitiespurchase of securities -10,790 -17,842
repayments/sales 53,793 23,819
Cash flow from indirect investment activities 43,003 5,977
Changes in cash at bank and in hand -8,343 10,080
AnnuAl report 2010 | Buma/Stemra 55 ã ContentS
general
Stemra Foundation’s objectivesThe Foundation’s objective is to represent and promote both
the tangible and intangible interests of music authors and
publishers and other copyright owners, in particular with
regard to mechanical reproduction rights. The Foundation’s
other goals are exercising and maintaining mechanical
reproduction rights for participating authors, participating
publishers, as well as other authors and copyright owners.
The Foundation’s participates in the implementation and
promotion of various activities in this context to achieve
its objective.
Principles for the valuation of assets and liabilities and the determination of the resultThe principles adopted for the valuation of assets and
liabilities and determination of the result are based on
historical costs unless otherwise explained.
Unless stated otherwise, assets and liabilities are stated at face
value. Income and expenses are allocated to the period to
which they apply.
The figures of 2009 are re-classified for comparison (with the
figures of 2010).
Accounting principles for the translation of foreign currencyTransactions denominated in foreign currency are translated to
euros at the applicable exchange rate on the transaction date.
Monetary assets and liabilities denominated in foreign
currency are translated to euros at the exchange rate applicable
on balance sheet date. Exchange rate differences are taken to
the profit and loss account. Non-monetary assets and liabilities
denominated in foreign currency that are valued on the basis
of historical costs are translated at the applicable exchange
rate on the transaction date.
Principles of consolidationIn view of their transparent structure, Stichting Buma/Stemra
Obligatiefonds and Stichting Buma/Stemra Aandelenfonds
are included in the Stemra financial statements by means of
proportional consolidation. Assets and liabilities, as well as
income and expenses, are included in proportion to the
participating interest. On the basis of the information provided
in the notes, no separate financial statements for Stemra
are included.
Tangible fixed assetsThe valuation of tangible fixed assets takes place on the basis of
historical cost less cumulative depreciation.
The depreciation is calculated as a percentage of the purchase
price according to the straight-line method on the basis of the
expected useful life.
The following expected useful life terms are applied:
• Computer equipment 3 years
Accounts receivableAccounts receivable are stated at nominal value less a
provision for bad debts.
Financial fixed assets The securities included under financial fixed assets are listed
shares, bond funds, and (convertible) bonds. Securities are
stated at market value as at balance sheet date.
Revaluation reserve for financial fixed assets Price gains/losses arising from the valuation of securities at
market value are not directly taken to the trading account, but
are first included in the revaluation reserve for financial fixed
assets (hereinafter: ‘revaluation reserve’). To the extent that the
revaluation reserve is insufficient, the deficit is charged to the
result.
Each year, the size of the revaluation reserve needed to absorb
price fluctuations is determined by the management board in
consultation with its asset managers. If the revaluation reserve
is larger than deemed necessary, this surplus is eligible for
addition to the royalties to be distributed.
Financial result and standard returnDividends are accounted for in the period in which they are
made payable; interest income is accounted for in the period
to which it relates.
Insofar as the balance of the revaluation reserve, less a possible
appropriate reserve for (un)realised gains or losses arising from
changes in market prices, leaves room for this, a ‘standard
return’ is included in the financial result, in addition to any
receivable share dividend and interest on bond funds. In the
calculation of the standard return, the dividend and interest
already paid out are taken into account, and only the difference
between the dividend/interest received and the standard
return is settled with the revaluation reserve.
The standard return is calculated as a percentage of the average
value of the shares and bond funds over the financial year, and
comprises the effective return on 5-year euro government
bonds at the end of the financial year plus a risk mark-up for
shares. The difference between the standard return and the
dividend received on shares or interest received on bond funds
is withdrawn from the revaluation reserve, if possible.
noTes To The sTemra Balance sheeT and profiT and loss accounT
56 AnnuAl report 201056 AnnuAl report 2010 ã ContentS
Due to progressive changes in legislation and regulations, the
system of applying a standard return is no longer regarded as a
generally acceptable principle.
However the system of standard return fits in with the
requirement that the recorded investment results on shares
and fixed-income securities show the most even development
possible in the profit and loss account over the years. For this
reason the management board and directors have decided to
continue the system of standard return.
Continuity reserve The continuity reserve’s aims include guaranteeing the
continuity of the work. It also serves to fulfil obligations in
respect of third parties, in particular with regard to distribution
of the royalties yet to be distributed in accordance with the
financial statements. This reserve furthermore serves to level
out unwanted fluctuations in the amounts available for
distribution, resulting, among other things, from domestic and
international pressure on turnover, as well as continuing
changes in the distribution of rights.
Appropriated reserveAppropriated reserves are the parts of reserves that
management has set aside for a special purpose. In this case, it
concerns the appropriated reserve for (un)realised gains/losses
arising from changes in market prices. For more detailed
information on this appropriated reserve, please refer to the
notes to the balance sheet.
ProvisionsProvisions are measured at either the nominal value of the
estimated expenditure required to settle liabilities and losses,
or the present value of that expenditure.
A provision is mentioned in the balance sheet when there is:
• a legal or constructive obligation as a result of a past
event, and
• of which a reliable estimate can be made, and
• it is probable a cash outflow is necessary to settle
the obligation.
The provision for reorganization costs is related to the
estimated costs of redundancy.
The long-service awards provision is a provision for future
long-service awards. The provision is the present value of
future benefits to be paid for long-service awards.
Determination of the resultIncome and expenses are accounted for in the year to which
they apply. The result is determined by calculating the
difference between the balance of realised income and
expenditure and the financial result for the year. The balance
of the profit and loss account is allocated/deducted from the
royalties to be distributed and/or the reserves by means of
profit appropriation.
Financial expenses The operating costs of the system for the collection of
programme data, Fingerprinting, are no longer classified as
financial expenses, but from 2010 directly charged to the
operating result.
Pension plans Obligations for contributions to defined contribution pension
plans are recognised as an expense in the profit and loss account
when the contributions are due.
Turnover In the financial statements, the turnover in royalties is added
to the royalties distributed. Stemra includes the exploitation of
mechanical rights in the turnover, insofar as these relate to the
financial year, can be determined in a reliable manner, and
there is reasonable certainty that the revenue is collectible.
TaxWith regard to Stemra, the Dutch tax authorities stipulated in an
agreement dated November 6, 2001, determining the legal
relationship between the parties, that Stichting Stemra is liable to
pay corporation tax. This agreement was extended at the end of
2008 for a period of three years, and is valid until 31 December
2011. Foreign withholding tax available for set-off and Dutch
dividend tax may be deducted from the tax due by virtue of this
agreement determining the legal relationship between parties.
A tax item is only included in the financial statements if
corporation tax is still owed after deduction of the foreign
withholding tax available for set-off.
Accounting principles for cash flow statementThe cash flow statement is drawn up using the indirect method.
noTes To The sTemra Balance sheeT and profiT and loss accounT
AnnuAl report 2010 | Buma/Stemra 57 ã ContentS
Use of estimatesDrawing up the financial statements requires management to
form opinions and make estimates and assumptions that
influence the application of principles and the reported value
of assets and liabilities, and of income and expenses. The
estimates and the associated assumptions are based on past
experience and various other factors that are considered
reasonable in view of the circumstances.
The outcome forms the basis for the opinion on the carrying
value of assets and liabilities that does not emerge clearly from
other sources.
The actual results may differ from these estimates.
58 AnnuAl report 201058 AnnuAl report 2010 ã ContentS
noTes To The sTemra Balance sheeT as per 31 decemBer 2010
Computer equipment
Actual cost as per 1 January 2010 1,354
Cumulative depreciation -1,130
Balance sheet value as per 1 January 2010 224
Changes during the financial year:
Investments 157
Depreciation -171
-14
Actual cost as per 31 December 2010 1,511
Cumulative depreciation -1,301
Balance sheet value as per 31 December 2010 210
Depreciation in number of years on average 3
In the profit and loss account, the depreciation expense is stated,
including depreciation charged on by Buma of € 0.1 million as a
result of Stemra’s use of Buma’s assets.
(1) Tangible fixed assetsThe changes in the tangible fixed assets can be specified
as follows:
(x € 1,000)
AnnuAl report 2010 | Buma/Stemra 59 ã ContentS
2010 2009
Balance sheet value as per 1 January 91,915 90,687
Changes during financial year:
Acquisitions 10,790 17,842
repayments / sales -53,793 -23,820
price movements 2,247 7,206
-40,756 1,228
Balance sheet value as per 31 December 51,159 91,915
Securities and bonds of Stichting Stemra are carried at market value.
Valuation differences on bonds and shares are charged or credited to
the revaluation reserve for financial fixed assets.
the total face value of the bonds amounted to € 12.0 million (2009:
€ 24.1 million) compared to a market value of € 12.4 million (2009:
€ 24.4 million). the reduction in the face value of € 24.1 million to
€ 12.0 million is on the one hand the effect of the conversion of part
of the fixed-income securities to bond funds and on the other hand
a decline in interest in the Stichting Buma/Stemra obligatiefonds
of 16.4%. this decline of 16.4% is the result of the sale of partici-
pations by Stemra worth € 69.5 million (repayment of loan in
current account to Buma € 55.7 million, repayment of loan in current
account to BSo and BSA € 13.3 million, increase cash Stemra € 0.5
million).
Stemra’s securities have been placed in Stichting Buma/Stemra
obligatiefonds and Stichting Buma/Stemra Aandelenfonds. the
foundations are proportionally consolidated in Stemra’s financial
statements at an average percentage of 20.1% (2009: 36.5%). At
the end of 2010 the interest is changed from 36.5% to 20.1%.
For the result implies that the percentages are used as applied for
2010 (36.5%). the participations give Stichting Stemra a 20.1%
(2009: 36.5%) interest in Stichting Buma/Stemra Aandelenfonds
and a 20.1% (2009: 36.5%) interest in Stichting Buma/Stemra
obligatiefonds at year end 2010.
(2) Financial fixed assetsThe changes in the financial fixed assets can be specified as follows:
(x € 1,000)
Securities
31 December 2010 31 December 2009asseTs
Fixed assets
Financial fixed assets 254,006 251,695
Other assets 15,823 73,440
269,829 325,135
liaBiliTies
Participants’ account 269,395 324,752
Current liabilities
Creditors 434 383
269,829 325,135
the fully-combined Financial statements of Stichting Buma/Stemra obligatiefonds (BSo) [Buma/Stemra bond Fund Foundations] and
Stichting Buma/Stemra Aandelenfonds (BSA) )[Buma/Stemra equity Fund] can be represented in condensed form as follows:
(x € 1,000)
60 AnnuAl report 201060 AnnuAl report 2010 ã ContentS
(4) Other accruals and deferred income
(x € 1,000) 31 December 2010 31 December 2009
Interest to be received 228 426
(3) Current account balancesthese consist mainly of current account balances with Stemra
associations and participants. Further notes about the settlement
of this current account balance is mentioned at the financial
fixed assets.
During the year a withdrawal is made that refers to the completion
of the streamlining of the organization which started in the previous
years. the withdrawal of € 0.2 million was recognized through the
profit and loss account (exceptional income and expenses). In 2009 a
withdrawal of € 0.7 million was made by way of profit appropriation.
the withdrawal levels out unwanted fluctuations in the amounts
available for distribution partly as a result of the negative financial
result.
(5) Cash at bank and in handAll the cash at bank and in hand is freely available
(6) Continuity reserveThe changes can be specified as follows
(x € 1,000)
2010 2009
Balance as per 1 January 5,929 6,650
Allocations - -
Withdrawals -169 -721
Balance as per 31 December 5,760 5,929
(7) Appropriated reserveThe changes can be specified as follows
(x € 1,000)
2010 2009
Balance as per 1 January -1,300 -2,600
Allocations 1,300 1,300
Withdrawals - -
Balance as per 31 December - -1,300
noTes To The sTemra Balance sheeT as per 31 decemBer 2010
€ 2.6 million of the negative result in 2008 is set aside by means
of result appropriation by the management board and the board
of directors in the appropriated reserve, in order to not fully settle
the effects of the stock exchange decline in 2008 with the 2008
collection year. In accordance with the intention of 2008, 50% of the
appropriate reserve of 2008 was balanced with the distributions of
the 2009 collection year and the remaining 50% is settled with the
distributions of the 2010 collection year.
AnnuAl report 2010 | Buma/Stemra 61 ã ContentS
2010 2009
Balance as per 1 January 5,683 -
(un)realised gains/losses arising from price changes 2,247 7,206
Withdrawal to the credit of the financial result to
standard return -1,719 -1,523
Withdrawal allocated to financial result -650 -
Balance as per 31 December 5,561 5,683
the (un)realized gain in securities amount to € 2.2 million (2009:
7.2 million) and are taken directly to the revaluation reserve for
financial fixed assets. the results on shares, (convertible) bonds and
bond funds are stated at a standard return. the percentage for 2010
was 6.2% (2009: 6.6%) for shares and for fixed-income securities
3.7% (2009: 4.1%). the withdrawal for the benefit of the financial
result at a standard return was € 1.7 million (2009: € 1.5 million).
the withdrawal allocated to the financial result was € 0.7 million.
(8) Revaluation reserve for financial fixed assets
The changes in the revaluation reserve for financial fixed assets can
be specified as follows: (x € 1,000)
Balance as per Additions Withdrawals Balance as per
1 January 2010 2010 2010 31 December 2010
optimisation of operations 148 - -148 -
long-service awards 74 12 -12 74
reorganization costs 157 - -18 139
397 12 -178 213
(9) Provisions
The changes in the provisions can be specified as follows:
(x € 1,000)
Provision for optimisation of operationsthe international changes with regard to music use and as a result of
this the allocated funds require an adjustment of the organization to
optimise the services provided in accordance with domestically and
internationally accepted standards and competitive conditions.
Provision for long-service awardsthe provision for long-service awards is a provision for future long-
service awards, calculated on the basis of actuarial assumptions with
regard to indexation and life expectancy.
Provision for reorganization coststhe expectation is that the provision for estimated severance pay-
ments will generally be settled in 2011.
62 AnnuAl report 201062 AnnuAl report 2010 ã ContentS
2010 2009
royalties to be distributed at the beginning of the year 40,863 45,438
royalties turnover 35,662 40,680
Changes in royalties to be distributed -1,020 -990
Available for distribution 75,505 85,128
Distributed in the reporting year:
Associations and participants 28,493 34,128
Foreign organizations 4,964 5,638
Central licensing 195 671
Administrative costs withheld in the netherlands 2,920 3,604
Administrative costs withheld abroad 178 224
Distribution incl. administrative costs charged 36,750 44,265
Royalties to be distributed at the end of the year 38,755 40,863
of the available amount to be processed for distribution in 2011,
€ 2.3 million will be added to the indivisible rights (2009: € 2.3
million, distributed in the 2010 payment).
the positive result for 2010 amounts to € 0.3 million (2009: € 0.4
million negative). € 1.0 million (2009: € 1,0 million) of this amount is
deducted from the royalties to be distributed and in accordance with
the decision of 2008, € 1.3 million (2009: € 1.3 million) was allocated
to the appropriated reserve.
(10) Royalties to be distributed (x € 1,000)
2010 2009
royalties turnover 35,662 40,680
Indivisible rights 2,348 2,285
Changes in royalties to be distributed -1,020 -990
Became available for distribution during the year 36,990 41,975
to be distributed at the beginning of the year 40,863 45,438
Available* 34,642 39,690
Distributed -36,750 -44,265
Royalties to be distributed at the end of the year 38,755 40,863
* Excluding indivisible rights which have already been
accounted for in the opening balance sheet
Available for distribution for Stemra(x € 1,000)
noTes To The sTemra Balance sheeT as per 31 decemBer 2010
AnnuAl report 2010 | Buma/Stemra 63 ã ContentS
2010 2009
Biem phonomechanical rights/Central licensing 16,684 18,229
Special licensing/private labels 6,306 5,656
radio & tV Mechanical rights 5,138 7,266
Mechanical rights online licensing 515 1,314
Home Copy/lending rights 3,223 3,533
Mechanical rights Abroad 3,796 4,682
35,662 40,680
Break-down of Stemra turnover(x € 1,000)
31 December 2010 31 December 2009*
Sister organizations abroad 3,063 3,475
Stemra associations and participants 1,555 1,522
Buma current account - 44,646
4,618 49,643
(11) Current account balances (x € 1,000)
the amounts owed to sister organizations abroad were largely
settled at the beginning of 2011. In the current account balance with
Buma a loan was included of € 55.7 million (2009: € 43.8 million)
from Buma to Stemra.
this loan is completely redeemed in 2010 by Stemra, so the Buma
current account was nil at the end of 2010. the loan is subject to
the euribor three-month-rate.
Advances to Dutch industrythis includes the invoiced advances on reproduction rights to
be settled by the Dutch industry for periods up to the end of 2010.
When the settlements are received from these producers, the
advances are deducted from the royalties to be received.
31 December 2010 31 December 2009*
Advances to Dutch industry 11,355 11,209
to be offset with industry and private labels 263 196
Holiday allowance/annual leave 102 142
other liabilities and accruals 335 547
12,055 12,094
* adjusted for comparison
(12) Other liabilities and accruals (x € 1,000)
64 AnnuAl report 201064 AnnuAl report 2010 ã ContentS
off-Balance sheeT commiTmenTs
Partially pledged bond portfolioIn accordance with the decision of the management board, at the
end of 2002, part of the bond portfolio of Stichting Buma/Stemra
obligatiefonds amounting to € 27.5 million was pledged as security
to InG Bank n.V. in connection with a cash facility needed for
normal operations.
Longterm financial liabilitythe financial liability with regard to the business accommodation in
Hoofddorp was entered until April 30, 2012.
the annual rent for Buma/Stemra together amounts to € 1.9 million
of which approximately 40% will be charged to third parties.
In the current composition, the annual amount for the leasing of cars
by Buma/Stemra is € 0.3 million.
the liability for terms longer than one year is € 0.4 million.
the financial liability for the rent of the printers was entered until
May 1, 2013. the annual rent amounts to € 0.1 million.
Buma/Stemra entered into a contract allowing Accenture to perform
a large portion of Buma/Stemra’s back office activities from 2007
until March 31, 2017. the resulting financial obligation amounts to
€ 18.2 million for the remaining duration of the contract, assuming
consistent volumes.
the off-balance sheet commitments of € 21.5 million can be
summarised as follows:
• less than 1 year: € 5.1 million
• between 1 and 5 years: € 15.7 million
• longer than 5 years: € 0.7 million
noTes To The sTemra Balance sheeT as per 31 decemBer 2010
AnnuAl report 2010 | Buma/Stemra 65 ã ContentS
2010 2009
Salaries 826 884
Social security contributions 119 121
pension contributions 78 86
other personnel expenses 72 41
1,095 1,132
Charged/compensated to third parties 3,923 3,819
5,018 4,951
expenses
(13) Personnel expenses (x € 1,000)
noTes To The sTemra profiT and loss accounT for 2010
the average number of employees during the reporting
year was 22 employees (2009: 23 employees) which corresponds
to an average of 20 Fte (2009: 20 Fte).
this amount does not include employees charged on via Buma.
Salary management board Stemra and registered Directors Buma/Stemra for the year 2010(x € 1,000)
Management StemraFee for 12 members of the management board Stemra
(incl. expense allowance) € 74.2
Registered Directors Buma/Stemra
H.G. van der ree salary € 200.0
(from May 1, 2010) pension charges € 40.4
C. van rij salary (incl. variable reward) € 233.9
pension charges and car € 55.2
C.p. Vervoord, former
chairman salary (incl. variable rewards) € 379.2
(till August 1, 2010) pension charges € 56.1
of the amounts mentioned above 30% is recognized in the financial statements of Stichting Stemra and 70% in the financial statements of
Vereniging Buma.
In preparing the financial statement until 2009 we used the exemption under Article 383 paragraph 1, title 9 BW2.
66 AnnuAl report 201066 AnnuAl report 2010 ã ContentS
2010 2009
Interest income and other incomeFixed income securities
Interest received on bonds 923 1,126
Shares
Share dividend received 2,019 2,160
2,942 3,286
Mutations revaluation reserve
Withdrawals from revaluation reserve for the benefit
of the financial result at standard return 1,719 1,523
Withdrawal from revaluation reserve allocated to financial result 650
other interest income and similar income 219 214
total income from investments 5,530 5,023
Financial expenses - -132
Interest expenses and other costs -709 -704
4,821 4,187
(14) Financial result (x € 1,000)
Financial expenses the operating costs of the system for the collection of programme
data, Fingerprinting, are no longer classified as financial expenses,
but from 2010 directly charged to the operating result.
AnnuAl report 2010 | Buma/Stemra 67 ã ContentS
oTher informaTion
To: The Board of Directors and the general meeting of affiliates to Stichting Stemra
independenT audiTor’s reporT
We have audited the accompanying financial statements 2010
of Stichting Stemra, Hoofddorp, which comprise the balance
sheet as at December 31, 2010, the profit and loss account for
the year then ended and the notes, comprising a summary of
the accounting policies and other explanatory information.
Management’s responsibility Management is responsible for the preparation of the financial
statements in accordance with the accounting policies selected
and disclosed by the entity, as set out in the notes to the
financial statements. Furthermore, management is responsible
for such internal control as it determines is necessary to enable
the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
Auditor’s responsibilityOur responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in
accordance with Dutch law, including the Dutch Standards on
Auditing. This requires that we comply with ethical require-
ments and plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s
judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to
fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation
of the financial statements in order to design audit procedures
that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of
the entity’s internal control. An audit also includes evaluating
the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by manage -
ment, as well as evaluating the overall presentation of the
financial statements.
We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
audit opinion.
OpinionIn our opinion, the financial statements are prepared, in all
material respects, in accordance with the accounting policies
selected and disclosed by the entity, as set out in notes to the
financial statements.
Basis of accounting and restriction on distribution and useWe draw attention to notes to the financial statements, which
describes the basis of accounting. The accounting policies
used are selected and disclosed by the entity. Our opinion is
not qualified in this respect.
Amstelveen, April 6, 2011
KPMG ACCOUNTANTS N.V.
R.J. Groot RA
68 AnnuAl report 201068 AnnuAl report 2010 ã ContentS
suBsequenT evenTs
Profit appropriationFor Stemra, the result for 2010 will be deducted from the
royalties still to be distributed.
Then, according to the assessment of the reserve, it will be
determined to what extent funds will have to be added to
or deducted from this. This movement will also be credited
or charged to the royalties to be distributed.
Proposal of the board of directorsAs shown in the financial statements, which we prepared in
accordance with Article 26(2) of the Articles of Association,
the board of directors proposes deducting c 1.0 million of the
positive result of c 0.3 million, from the royalties to be
distributed and allocating c 1.3 million to the appropriated
reserve (in accordance with the decision made in 2008).
The proposal has already been incorporated in the 2010
financial statements.
AnnuAl report 2010 | Buma/Stemra 69 ã ContentS
70 AnnuAl report 2010 ã ContentS
AnnuAl report 2010 | Buma/Stemra 71
managemenT Boards and direcTors
De Jeugd van tegenwoordig
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72 AnnuAl report 201072 AnnuAl report 2010 ã ContentS
composiTion of managemenT Boards and direcTors
As per April 1, 2011
Management board of Vereniging Buma
dr. K.P. Boehmer
Chairman – composer
serious music
mr. H. Kosterman
Vice-chairman - composer/
lyricist light music
T. Berk
Secretary – publisher
drs. S.A.A. Abdoelbasier
composer / lyricist light
music
J.A. van Bergen
lyricist
A.J.H. van Berkel
publisher
P.M. van Brugge
composer media music
H.C.M. de Clercq
composer serious music
M.W. Mensink
publisher
T.J.M. Peters
composer/lyricist
light music
A.L.L. de Raaff
publisher
drs. H.O. Westbroek
composer/lyricist
light music
R.D. van Vliet
vice chairman - publisher
mr. E. Boom
secretary – author
mr. drs. L.J. Deuss
publisher
J.C.R. Gerrits
publisher
J.H. Grevelt
author
J.N. Hamburg
author
mr. H. Kosterman
author
A.J. Kraamer
author
A.C.M. Ruiter
author
drs. H.O. Westbroek
author
dr. K.P. Boehmer,
chairman – author,
appointed by Buma
Management board of Stichting Stemra Vacancy per 1-1-2011
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Directors of Buma/Stemra
H.G. van der Ree
Chairman of the Board
of Directors
mr. C. van Rij
Director Legal Affairs
drs. W.J. Ketellapper
Director General Affairs
mr. H. Eijkelenboom
Secretary of the Board of
Directors
AnnuAl report 2010 | Buma/Stemra 73 ã ContentS
addiTional joBs sTaTuTory direcTors
lisT of addiTional posiTions of memBers of The Board of Buma as per april 1, 2011
Drs. S.A.A. Abdoelbasier, Composer/lyricist light music- employed at royal Bank of Scotland- Chairman Stichting Consent- Commissioner and shareholder of Financial
Street VoF- Commissioner and shareholder of Beaubury
trading Street VoF- Member of the board palm- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
J.A. van Bergen, Lyricist- Freelance Author for theatre, tv, movie, radio,
song, print and advertising - In partnership Van Bergen and Storimans/
Authors, Hoorn- Advisor Music theatre Fonds podium Kunsten- Intended secretary and joint managing
Director of Stichting paul van Vliet Academie i.o.
- Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
- Member of the board BSo (Stichting Buma/Stemra obligatiefonds)
T. Berk, Publisher- Managing Director ( president) of talpa Music
B.V., AMV/talpa Music GMBH, 8ball Musisic and “the Voice talent Agency BV.” Also of his private holding “Son Vida Holdings BV”
- Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
- Member of the board BSo (Stichting Buma/Stemra obligatiefonds)
A.J.H. van Berkel, Publisher- Managing Director Warner/ Chappell Music
Holland BV.- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
Dr. K.P. Boehmer, Composer serious music- Freelance composer- Member of the board GeneCo
- Member of the board unie van Composeren in the netherlands
- Vice-Chairman european Composers Forum (eCF)
- Vice-Chairman BIeM- Chairman Stemra- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
P.M. van Brugge, Composer media music- Freelance composer- Senior lecturer composition bij Codarts
Hogeschool voor de Kunsten rotterdam- Freelance executive musician and conductor
(ZZp)- Member of the board of the association
Dutchfilmcomposers.nl - Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
H.C.M. de Clercq, Composer serious music - Freelance composer- Freelance filmmaker(directing, camera,
editing)- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
Mr. H. Kosterman, Composer/lyricist light music- Chairman of palm- Secretary of Sena- Member of the board Stemra- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
M.W. Mensink, Publisher- Director Strengholt BV- Managing Director and majority shareholder
VoC BV- treasurer Vereniging Muziekhandelaren and –
uitgeverijen van nederland- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
T.J.M. Peters, Composer/lyricist light music- Freelance composer / lyricist- Freelance Music producer- Music publisher- owner/partner nrGY Music BV - partner BoepBV (digital music distributor)- Member of the board Sena (sector performers)- Member of the board Vereniging palm - treasurer GonG- treasurer StoMp (independent record label
nVpI)- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
A.L.L. de Raaff, Publisher- Managing Director and majority shareholder
of entertainment company CtM BV, including the Music publisher Cp Masters BV and Imagem CV
- Chairman nederlandse Muziek uitgevers Vereniging
- production Harpengala- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
Drs. H.O. WestbroekComposer/lyricist light music- Copywriter- performing artist- Columnist- radio and tV presenter at radio Veronica,
respectively rtV utrecht- Joint manager Café-restaurant ‘Stairway to
Heaven’- Member of the board Stemra- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
H.G. van der Ree, Chairman of the Board of Directors Buma/Stemra as per May 1, 2010- Statutory chairman of the Board of Directors
Stichting Buma/Stemra Aandelenfonds- Statutory chairman of the Board of Directors
Stichting Buma/Stemra obligatiefonds- Member of the board Stichting Buma/Stemra
Deelneming- Secretary/treasurer Stichting SCAn- Member of the board Stichting Brein- Secretary Stichting Buma Cultuur- Vice chairman Vereniging VoICe
mr. C. van Rij, Vice Chairman of the Board of Directors Buma/Stemra, Director Legal Affairs Buma/Stemra- Member of the board Stichting Buma/Stemra
Deelneming- Secretary Stichting Brein- treasurer Stichting de thuiskopie- Member of the board Stichting leenrecht- Member of the board Stichting onderhandelin-
gen thuiskopievergoeding- Member of the board Stichting
onderhandelingen leenrechtvergoeding
- Member of the board Stichting Beheer rechten Fingerprinting Database
- Member of the board vereniging VoICe
C. Vervoord, 1 May resigned as Chairman of the Board of Directors and in August 2010 resigned from Buma/Stemra
74 AnnuAl report 201074 AnnuAl report 2010 ã ContentS
Dr. K.P. Boehmer, Author, appointed by Buma- Freelance composer- Member of the board GeneCo - Member of the board unie van Composeren in
nederland, - Vice-chairman european Composers Forum (eCF)- Vice-chairman BIeM- Chairman Buma- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
R.D. van Vliet, Publisher- owner of Cloud 9 Music bv- Member of the board Buma Cultuur- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)- Managing Director and majority shareholder
Cloud 9 Music bv- Managing Director and majority shareholder
Cloud 9 Dance nv- Managing Director and majority shareholder
Chrysalis Songs Benelux- Managing Director and majority shareholder
Dance Foundation bv- Managing Director and majority shareholder
napith ltD- Managing Director and majority shareholder
the right track Music- owner rVV Music bv
Mr E. Boom, Author- Composer/Copywriter- Musician- Managing Director and majority shareholder
number one Music Holland BV, music publisher- Managing Director and majority shareholder
Gentle Consultancy BV, legal consultancy entertainment-line of business
- Member of the board; secretary Stichting Sociaal Fonds Buma
- Member of the board; secretary Vereniging pAlM
- Member of the board occupational pension fund Stichting AenA
- teacher Johan Alsbach Stichting, College for Music publishers
- Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
- Member of the board BSo (Stichting Buma/Stemra obligatiefonds)
Mr. drs. L.J. Deuss, Publisher- Director Albersen Verhuur bv and Deuss
Holding bv- Chairman of the board leo Smit Stichting- Chairman Stichting output/Amsterdam
electric- Vice-chairman board VMn (Vereniging
of Music sellers and Music publishers in nederland)
- Member of the board/treasurer Stichting nederlands Music Instituut
- Member of the board Stichting Sociaal Fonds Buma
- Advisor Cultural projects of the city the Hague- Freelance teacher Artez Conservatorium Arnhem- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
J.C.R. Gerrits, Publisher- Managing Director and majority shareholder
High Fashion Music BV- Member of the board nederlandse Muziek
uitgevers Vereniging- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
J.H. Grevelt, Author- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)- treasurer Vereniging pAlM- owner HSG Music
J.N. Hamburg, Author- Composer- Director and joint owner of rapenburg
produkties V.o.F. including FutureClassics (CD’s) and FutureClassicsMusic (publisher)
- Chairman of Genootschap nederlandse Componisten
- Chairman of Stichting GeneCo- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
Mr. H. Kosterman, Author - Chairman of pAlM - Secretary van Sena- Vice-chairman Buma
- Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
- Member of the board BSo (Stichting Buma/Stemra obligatiefonds)
A.J. Kraamer, Author- Musician, composer, lyricist, performing artist,
producer, publisher, conductor, arranger, technician
- owner/Director neW B.V. (new efficient Wholesale B.V.), teD B.V. (the electronic Designers), AKM B.V. (Ad Kraamer Music B.V.)
- Member of the board (Chairman) Htr (Stichting Heusdense tV& radio station)
- Member of the board pAlM (professional association, professional Authors light Music)
- Member of the board GonG (Genootschap onafhankelijke nederlandse Geluidsproducers)
- Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
- Member of the board BSo (Stichting Buma/Stemra obligatiefonds)
A.C.M. Ruiter, Author- Freelance composer- Freelance performing musician- Member of the board BVpop, department of
FnV KIeM - Member of the board pAlM, professional
association of professional authors of light Music
- Member of the board General Management of Sena and Member of the board of department executives of Sena
- Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)
- Member of the board BSo (Stichting Buma/Stemra obligatiefonds)
Drs. H.O. Westbroek, Author - Copywriter- performing artist- Columnist- radio and tV presenter at radio Veronica
(respectively rtV utrecht)- Joint manager Café-restaurant ‘Stairway to
Heaven’- Member of the board Buma- Member of the board BSA (Stichting Buma/
Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/
Stemra obligatiefonds)
lisT of addiTional posiTions of memBers of The Board of sTemra as per april 1, 2011
AnnuAl report 2010 | Buma/Stemra 75
colophon
Fran
s D
uijt
s /
phot
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ll A
cces
s en
tert
ain
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t
phoTo cover:
Caro emeraldphoto: Adrie Mouthaan
Kytemanphoto: Mike Breeuwer
Michel van der Aaphoto: Marco Borggreve
Seung-Ah ohphoto: Co Broerse
renske taminiauphoto: Hans Speekenbrink
Sara Kroos(Annie M.G. Schmidtprijs)photo: Frans van Zijst
the ploctonesphoto: Jeroen Dietz
richard rijnvosphoto: Co Broerse
chief ediTors
Frank Helmink, Buma/Stemra
TexT
erik de Boer, Boardroom Financial pr
concepT & design
link Design, Amsterdam
prinTing W.C. Den ouden bv, Amsterdam
typographical and printing errors reserve. All amounts quoted in this annual report are in euros.Disclaimerthe original financial statements of Vereniging Buma and Stichting Stemra are prepared in the Dutch language. this document is an english translation of these financial statements. In case of differences between the english and Dutch text the latter will prevail.
phoTos BacK cover from Top To BoTTom:
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76 AnnuAl report 2010
Siriusdreef 22-282132 Wt Hoofddorpt 023 799 79 99F 023 799 77 77e [email protected]
the Hague officelange Voorhout 86-122514 eJ Den Haagt 070 310 91 09F 070 310 91 00e [email protected]
some of The mosT-TalKed
aBouT composers/lyricisTs in 2010
Buma association/stemra foundation
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