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THE BRITISH CHAMBER OF COMMERCE FOR ITALY
(INCORPORATED)
REPORT OF THE COUNCIL FOR THE YEAR ENDING 31 DECEMBER 2014
Members of the Council are regarded as Directors for the purposes of the Companies Act.
The Councillors have the pleasure of submitting the Report and Accounts of the Chamber for the year ended 31st
December 2014.
Principal activities
The British Chamber of Commerce for Italy is a private non-profit organisation whose mission is to assist and
encourage the development of trade and investment between the United Kingdom and Italy and to support and
promote the interests of its members’ commercial activities.
We work closely with UK Trade and Investment and the British Consulate General in Milan, as well as with the British
Embassy in Rome. Founded in Genoa in 1904, the Chamber’s head office is based in Milan and regional branches are
operative throughout Italy.
At the year end, the Chamber had a total of 345 members, representing a wide range of Italian and British
companies as well as individuals. The total number of members was 36 up on last year following (ongoing) work on
membership development.
Review of activities
As mentioned last year, in early 2014 a Special General Meeting agreed to change the bylaws of the Chamber in
order to extend the mandate of the management team (the President, VPs, Treasurer and Councillors) so as to have
more time to finish the process of change which they had initiated, especially in view of the arrival of EXPO 2015.
This process continued in 2014 and, inter alia, saw the departure of our Secretary General, Simona Frignani. We
thank her for her contribution over the last 6 years and wish her well for the future.
At the heart of our vision for the future was what was illustrated at the time by reference to the British Olympic
Rowing Team’s leitmotif (“Does it make the boat go faster?”) which had driven their quest for gold at the last
Olympics. Our objective was, and remains, to put membership at the centre of our activities by looking at all we do
through the question: “Does it help us grow (and keep) members”.
Not everything has gone quite as expected but I believe that we are in a better place than we were and well
positioned to get the most out of the next 5 months of EXPO and the rest of 2015.
The number and variety of high quality events continued in 2014 and included:
o 10 tax and legal seminars and workshops.
o 11aperitifs and social & cultural events.
o A sustaining members dinner with Michael Fallon, at the time UK Minister of State for Energy, the
Department of Energy and Climate Change, and a sustaining members lunch with Douglas Flint,
Chairman HSBC Bank Plc, in his capacity as UK Business Ambassador. We also hosted a round table
event at Palazzo Cusani for Mark Boleat, Chairman of the City of London’s Policy and Resources
Committee.
o Another Gala Dinner at Villa D’Este to raise funds for research into Children’s leukaemia with the
Charity, Comitato Fiori di Lavanda.
o Two highly successful golf days – in July at Le Rovedine and in September at Menaggio.
o Four other events dedicated to Sustaining Members, amongst which a high profile event with Jaguar at
their Flagship store in Milan.
o A series of successful Business Lunches in Milan (13) - we have continued to be graced with a range of
high quality Guests of Honour and Speakers. We also ran another lunch at the Villa Wolkonsky in Rome
with HMA as our host and speaker.
o Another successful “Women in Business” event in conjunction with UKTI, this time in Naples. This was
preceded by a business event at the British Consulate in Naples, hosted by Tim Flear at which Salvatore
Tramontano also presented the BCCI to a group of local business men and women.
o Continuing valuable contributions from ELCS and IPEC.
During the year we also welcomed Kate Taylor as our new Honorary Regional Secretary for Tuscany, Steven Taylor as
Honorary Regional Secretary for London and Kitty Bruce-Gardyne as Honorary Regional Secretary for Scotland.
As commented in December 2014, whilst we continue to present a wide range of excellent networking events, we
still have more to do in bringing business leads to our members and in reinforcing our position as the Voice of British
Business in Italy. We are not doing a bad job, but we can do more to help companies from the UK and elsewhere
establish a presence in Italy. They need advice on legal, fiscal and logistical matters and our members are ideally
placed to provide this. We can also help companies that are having difficulties with unfair practices or other
obstacles to investing in Italy. We should also be engaging with the BCCs in the UK and making better use of the
COBCOE network around Europe to attract new members and to bring opportunities to existing ones. The highly
successful joint Chambers events we have run in Milan also underline the fact that there is much more to do with
organisations that share our objectives. Finally, strong partnerships with British and Italian institutions remain
crucial and in my last year as President I want to again build on these, particularly with UKTI with whom we continue
to work extensively.
Councillors During the year Sebastian Buca, Giuseppe La Naia (previously Councillor till 2012) and Matt Parkinson were elected
as Councillors.
We would like to thank all our Councillors who continued to support the Chamber throughout 2014. Special thanks
go to Jim O’Gara and Vic Annells who both left Italy to take up new appointments elsewhere, and to John Murphy,
BCCI President from 1998 to 2002 who resigned his office as Honorary Councillor. We extend a warm welcome to
Tim Flear, new HM Consul General and Director for UK Trade & Investment.
We are sorry to report the death on 28th
April 2014 of Cavaliere del Lavoro Pier Carlo Marengo who was a mainstay
of the BCCI for many years – first as a Councillor and latterly as an Honorary Councillor – and was constant in his
support for the Chamber.
Staff
Our sincere thanks goes as ever to the Chamber staff who have demonstrated their strong commitment and ability
to act positively during a period of important changes in a difficult economic environment. As mentioned above,
Simona Frignani left the Chamber towards the end of 2014 and was replaced (in early April 2015) by Sofia Astrid
Pennacchi who has made an excellent start. During the year we welcomed Simona Cordovani as new Accountancy
& Administration Manager. We wish all the best to Peter Riley who returned to England.
Financial review
The year to 31st
December 2014 ended with a loss of €49,640 (2013 - profit of €683).
This loss arose primarily from the costs associated with the settlement reached with a former employee amounting
to €37,437 and €8,507 incurred in connection with the development of the Chamber’s new web site.
It is worth noting that the results from the core activities of the Chamber (membership quotas, sponsorships, events
and seminars) reported a loss of €3,696 in 2014 compared with losses of €16,126 in 2013 and €20,224 in 2012. Final
results for 2012 and 2013 were substantially breakeven due to the margin earned on one specific UKTI project,
“Fancy a cup of coffee”. The UKTI project conducted in 2014, “Women in business”, closed in breakeven.
Income overall decreased by €38,166, of which €34,976 relate to a decrease in revenues from UKTI projects and
€3,065 to less financial income.
Staff costs (€202,706) increased by €24,978 compared with 2013 (€177,728) though 2014 costs include the
settlement cost mentioned above. Given the overall result for the year, no staff bonus was recognised in 2014, a
saving of €7,000.
Other expenses decreased by €13,163. Project costs decreased by €18,186, whilst legal expenses incurred in
connection with the afore-mentioned settlement amounted to €3,437 and costs incurred for the new web site
amounted to €8,507. Consequently, the net impact of all other costs and expenses was a decrease of some €6,916.
The Chamber continues to enjoy a good liquidity position, reporting a balance of cash and cash equivalents of
€284,525 at 31st
December 2014 compared with €311,144 as of the previous year-end. This position has
deteriorated in the four months ended 30th
April 2015 to €215,302 mainly as a result of the settlement of creditors
as of 31st
December 2014, net of the collection of debtors (€71,107).
The accumulated fund of the Chamber amounts to €110,188 as of 31st
December 2014 compared with €159,828 as
of 31st
December 2013, as a result of the loss for the year of €49,640.
In conclusion, the negative results reported for the year ended 31st
December 2014 were primarily the result of
special items. The challenge facing the Chamber for 2015 is to return to a substantially breakeven position. Chamber
Directors have been dedicating significant time and effort in the development of an interesting programme for 2015,
taking advantage as much as possible of the opportunities offered by EXPO.
Directors
The members of the Council for the whole or part of the year were:
John J Law Colin Jamieson
Martin Pugsley Roger King
David Crackett Victor Annells
Donatella Cungi Matt Parkinson
Paolo Gibello Lesley Jackson
Pier Carlo Marengo Jim O’Gara
Sharon Reilly John Stewart
Steven Taylor Andrew Thompson
Fabrizio Zucca Tim Flear
Sebastian Buca Giuseppe La Naia
On behalf of the Council,
________________________________ ________________________________
John Law Roger King
President Treasurer
Directors' responsibilities
The Directors are responsible for keeping proper accounting records which disclose with
reasonable accuracy at any time the financial position of the Chamber to enable them to
ensure that the financial statements comply with the Companies Act 2006. They are also
responsible for safeguarding the assets of the Chamber and hence for taking reasonable
steps for the prevention and detection of fraud and other irregularities.
Statement of Disclosure of Information to Auditors
STATEMENT OF DIRECTORS’ RESPONSIBILITIES FOR THE ACCOUNTS
Company law requires the Directors to prepare financial statements for each financial year
which give a true and fair view of the state of affairs of the Company (“the Chamber”) and of
the profit (surplus) or loss (deficit) of the Chamber for that period. In preparing those financial
statements the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable and prudent;
• state whether applicable accounting standards have been followed, subject to any
material departures disclosed and explained in the financial statements;
• prepare the financial statements on the going concern basis unless it is inappropriate
to presume that the Chamber will continue in business.
In the case of each of the persons who are Directors at the time of approval of this report:
a) so far as the Directors are aware, there is no relevant audit information of which the
Chamber’s auditors are unaware;
b) each Director has taken all the steps that he/she ought to have taken as a Director in order
to make himself/herself aware of any relevant audit information and to establish that the
Chamber’s auditors are aware of that information.
Notes 2014 2013
INCOME
Subscriptions:
- Members 234.194 236.892
- Foreign English Language Schools 45.057 43.772
Services 3 96.745 130.434
Net financial income 4 2.134 5.199Total income 378.131 416.297
EXPENDITURE
Staff costs 5 202.706 177.728
Cost of services rendered 6 77.012 80.953
Premises 62.727 63.323
Professional services 7 24.864 16.757
Project costs 8.935 27.121
Stationery and communication 7.427 8.525
Depreciation 2.419 4.694
Other 8 35.913 31.086
Total expenditure 422.003 410.188
Surplus (Deficit) for the year before (43.872) 6.109
STATEMENT OF INCOME AND EXPENDITURE AND ACCUMULATED FUND FOR THE
YEAR ENDED 31 DECEMBER 2014
Euro
Surplus (Deficit) for the year before
taxation
(43.872) 6.109
Less: taxation 9 (5.768) (5.426)
Income (Loss) for the year (49.640) 683
Accumulated fund at 1 January 159.828 159.145
Accumulated fund at 31 December 110.188 159.828
The notes 1 to 18 form part of these accounts
_____________________________ _____________________________
John Law Roger King
President Treasurer
Notes 2014 2013
Fixed and intangible assets 10 4.411 6.830
Current assets;
Investments 11 150.681 207.341
Debtors 12 56.420 24.360
Cash at bank and in hand 13 133.844 103.803
340.945 335.503
Less: creditors 14 201.940 137.951
Net current assets 139.005 197.552
Total assets less current liabilities 143.416 204.383
Provision for employee leaving indemnity 15 33.228 44.555
Net assets 110.188 159.828
Represented by;
Accumulated fund 110.188 159.828
BALANCE SHEET AT 31 DECEMBER 2014
Euro
The notes 1 to 18 form part of these accounts
_____________________________ _____________________________
John Law Roger King
President Treasurer
2014 2013
Surplus (Deficit) for the year before taxation (43.872) 6.109
- Interest income (2.134) (5.199)
Non-cash items
- Depreciation charge 2.419 4.694
(11.326) 8.708
Changes in working capital
- (Increase) Decrease in debtors (32.060) 21.596
- Increase (Decrease) in creditors 63.989 (5.004)
- Taxes (5.768) (5.426)
Net cash inflow from operating activities (28.753) 25.478
Cash flow from investing activities
- Dismissal/(Purchase) of fixed assets, net 0 (2.851)
Cash flow from financing
2.134 5.199
- Charge / (Net payment) for employee termination indemnity
- Returns on investments and servicing of finance
CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2014
Euro
Cash items arising from non-operating activities
(26.618) 27.826
311.144 283.318
284.526 311.144
_____________________________ _____________________________
John Law Roger King
President Treasurer
Net (decrease)/increase in cash and cash equivalents
Balance of cash and cash equivalents at 1 January
Balance of cash and cash equivalents at 31 December
The notes 1 to 18 form part of these accounts.
2. ACCOUNTING POLICIES
Fixed assets
Office equipment
Office furniture
1. BASIS OF PRESENTATION OF THE ACCOUNTS
The accounts are prepared on the going concern basis under the historical cost convention
and are based on the Chamber's accounting records used for taxation and other purposes in
Italy. The Articles of Association of the Chamber were amended by Special Resolution on 12
March 2014. Such amendments included the provision that the Accounts be prepared in
accordance with International Financial Reporting Standards in compliance with Section 395
(1) (b) of the Companies Act, 2006. Previously the acounts were presented to conform to
accounting principles generally accepted in the United Kingdom and the Companies Act 2006.
The change to IFRS did not result in any adjustments to balances previously reported.
The principal accounting policies, which have been applied consistently, are set out below.
Fixed assets are stated at cost less accumulated depreciation.
Depreciation is calculated using the straight-line method at a rate estimated to write-off the
cost of the asset over its expected useful life, which can vary between three and eight years.
Depreciation rates applied are as follows:
20%
12%Office furniture
Investments
Debtors
Foreign currencies
Income
Debtors are stated at net realisable value.
Investments comprise of a time deposit with a bank and are stated at nominal value which
corresponds to the net realizable value, inclusive of interest accrued.The investments are readily convertible into cash and are therefore considered liquid
resources for the purposes of the cash flow statement.
Interest is entirely paid at maturity and it is not recognized in case of earlier reimbursement.
Transactions in foreign currencies are translated at the exchange rate ruling at the date of the
transaction. There are no monetary assets and liabilities shown in the balance sheet.
12%
Depreciation in the year of purchase is calculated at half the rate shown above.
Income from subscriptions is recognized on an accrual basis. Subscriptions fees collected
and pertaining to the following accounting period are classified as deferred income.
Income from services is recognised in the accounting period in which the services are
rendered.
3. INCOME FROM SERVICES
2014 2013
Examinations 28.229 26.956
Events 37.986 35.029
Seminars 9.000 12.252
Project income 9.793 44.760
Open University 0 115
Web Site services sponsorship 4.400 4.275
English Language Consultancy Service –
advertising and bookings
7.338 7.047
96.745 130.434
4. NET FINANCIAL INCOME
Euro
Euro
Examinations include income from English language exams under the International
Professional English Certificates (IPEC) scheme.
Project income derives from the "Women in Business" initiative carried out for UKTI.
Income from “English Language Consultancy Service – advertising and bookings” (ELCS)
does not include subscriptions relating to the member schools, which are included under the
income from subscriptions from “Foreign English Language Schools”.
2014 2013
Bank interest, net 12 12
Income from investments, net 2.122 5.187
2.134 5.199
5. STAFF COSTS
2014 2013
Salaries 117.150 128.484
Social security contributions 35.205 35.531
Accrual for leaving indemnity (note 14) 9.628 8.708
Other staff costs 40.723 5.005
202.706 177.728
Average number of employees 4 4
Euro
The Other staff costs include the settlement costs reached with a former employee
amounting to some Euro 34.000.
Euro
6. COST OF SERVICES RENDERED
2014 2013
English language services 41.995 41.820
Examination services 27.272 26.300
Events 7.745 12.833
77.012 80.953
7. PROFESSIONAL SERVICES
2014 2013
Book-keeping services 16.234 11.426
Legal fees 3.437 0
Payroll services 2.486 3.122
Audit 2.000 1.500
Health and safety consultancy fees 420 534
Other 287 175
24.864 16.757
8. OTHER EXPENSES
Euro
Legal fees were incurred in connection with the settlement reached with a former employee
and were provided by the legal firm Studio Toffoletto, in which Donatella Cungi, one of the
Chamber's Directors, is a partner.
Euro
8. OTHER EXPENSES
2014 2013
Travel expenses 6.391 8.627
New web site 8.507 0
Publicity expenses 3.676 5.619
Office expenses 5.638 5.978
Software 1.593 2.874
Financial expenses 1.451 1.635
Membership 1.890 2.844
Other expenses, net 6.767 3.510
35.913 31.086
Euro
During the year the Chamber developed a new web site with the help of outside consultants.
9. TAXATION
Office
furniture,
Assets
Cost 1 January 2014 31.387 0
Additions 0 0
Write off 0 0
Cost 31 December 2014 31.387 0
Accumulated depreciation 1 January 2014 24.556 0
Intangible
equipment
10. FIXED AND INTANGIBLE ASSETS
The Chamber is exempt from IRES income tax in Italy on the contributions made by members
by way of annual subscriptions. Income taxes are due on income arising from activities of a
commercial nature. However, no taxes are accrued as the Chamber will have a loss for tax
purposes.
The Chamber is subject also to IRAP tax, the entire amount of which is disclosed under
“Taxation” in the statement of income and expenditure. This is equal to 3.90 per cent of an
adjusted tax base which considers certain expenses, such as staff costs, as non-deductible
for IRAP tax purposes.
Value Added Tax can be recovered on costs relating to commercial activities.
Euro
fixtures and
Accumulated depreciation 1 January 2014 24.556 0
Charge for the year 2.419 0
Write off 0 0
26.975 0
Net book value 31 December 2014 4.411 0
Net book value 31 December 2013 6.830 0
11. INVESTMENTS
2014 2013
Investments 150.681 207.341
Nominal value at 31 December 2014 € 150.000
Accumulated depreciation 31 December 2014
Euro
These investments include € 681 of interest income accrued and consist of:
• Time deposit - Unicredit being a fixed rate savings deposit
from 16 April 2014 with maturity date 16 April 2015:
12. DEBTORS
2014 2013
Services 33.030 8.646
Other debtors 22.808 14.729
Prepayments and accrued income 582 985
56.420 24.360
13. CASH AT BANK AND IN HAND
2014 2013
Cash at bank 133.317 103.723
Cash in hand 526 80
133.844 103.803
14. CREDITORS
2014 2013
Trade creditors 27.357 9.745
Payroll taxes and social security 5.844 6.320
Tax liability 3.520 0
Accruals 90.807 38.912
Deferred income 74.413 82.974
The increase in Debtor services is due to the billing in December of the services rendered in
connection with the event "Women In Business" and with IPEC exams.
Euro
Euro
Euro
Deferred income 74.413 82.974
201.940 137.951
15. PROVISION FOR EMPLOYEE LEAVING INDEMNITY
Euro
1 January 2014 44.555
Charge for the year 9.628
Utilization (20.955)
31 December 2014 33.228
The movement in the provision for employee leaving indemnity for the year 2014 is as follows:
The increase in the Accruals refers to the deferral of December payroll payments to early
January and the settlement with a former employee.
Under existing regulations and pursuant to labour contracts with its employees, the Chamber
must pay a severance indemnity to all personnel leaving its employment, based on the length
of service and remuneration over the period of employment. The amount of such leaving
indemnity accrued to date with respect to present employees is fully provided for in the
accompanying accounts.
17. CAPITAL COMMITMENTS
18. OPERATING LEASES
2014 2013
50.000 49.433
162.501 210.089
2014 2013
16. EMOLUMENTS OF THE DIRECTORS AND OTHER TRANSACTIONS
In 2014 and in 2013 the directors did not receive any emoluments. As disclosed in Note 7,
during the year legal fees of Euro 3,347 were paid to a legal firm of which one the Directors is
partner and fees for payroll services of €2,486 to a firm in which another Director has an
interest.
Within one year
Between two and five years (*)
Electronic equipment
Operating lease costs:
The Chamber had no significant capital commitments at 31 December 2014.
The total rentals for operating leases, charged as an expense in the statement of income and
expenditure, were € 52.567 (2013 € 51.679) and related to the rental of the premises at Via
Dante 12, Milan and to the lease of some electronic equipment.
At 31 December 2014, the Company was committed to making the following payments under
non-cancellable operating leases:
Office rental
Operating lease costs:
2014 2013
2.930 2.603
8.477 1.104
Operating lease costs:
(**) One lease contract expired in october 2014 and was renewed for a further 5 years to
November 2019; the second one will expire in April 2016.
During the year fees amounting to Euro 2.000 were incurred for services provided by the
auditors.
19. AUDITORS’ REMUNERATION
Within one year
Between two and three years (**)
(*) The office rental agreement expired in March 2013 and was renewed for a further 6 years
to March 2019.