Club Treasurer’s Report 2020.

THE CLONTARF GOLF and BOWLING CLUB
Club Treasurer’s Report on the 2020 Audited Accounts
and the Budget for 2021 and Estimates for 2022 & 2023

Contents Page
Executive Summary 2
1.1 Overview of the Audited Accounts results for 2020 3
1.2 Financial year 2020 results compared to Budget and previous year 4
2.1 Overview of the 2021 Budget 8
2.2 Review of the 2021 Budget 8
3.1 Overview of the 2022 and 2023 Estimates 13
3.2 Review of the 2022 and 2023 Estimates 14
Michael F. Murphy
Club Treasurer
12 January 2021
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Executive Summary
I am pleased to attach
1. The Audited Accounts for 2020,
2. The Budget for 2021, with Financial Estimates for 2022 and 2023, and
3. The Other Financial Information pack
The year 2020 has been a difficult year for the entire World, our members and our staff. It has also
been a difficult year for the Club due to the impact of the Covid-19 pandemic across all areas of the
Club’s operations. Against this background, I am pleased to report that the Club from a financial
perspective has weathered these difficult times very well to date. Unfortunately, the Club is again in
total lockdown as I write this report which presents the Club with continuing short term challenges.
The Audited Accounts for the year ended 31 October 2020 detail a loss of € 38,232. This result is
– Better than the revised Budgeted loss for the year of €44,000.
– Has resulted in a positive cash flow for the year of €9,609.
– Has also resulted in an improvement in the Cash Reserve Fund of €21,620.
Included in this report is a detailed review of the accounts.
The Other Financial Information pack sets out the following
– A summary of the results for the last six years, and
– Detailed Variance analysis of the results for 2020.
A detailed commentary on those Variances is set out in 1.2.
The Budget for 2021 and Estimates for 2022 and 2023 pack sets out
– Detailed comparisons of the Budget and Estimates to the Budgets and Actual results for both
2019 and 2020.
In the Budget we are assuming no increase in the Annual Members subscription for the 2020/2021
year.
Detailed commentaries on the Budgets and Estimates, are set out at 2.2 and 3.2.
At the AGM on 31 January 2020 the Management Committee was requested to revise the Budget
presented for 2020 (detailing a loss of €85,000) to achieve a Cash Neutral position, and to restore
the Cash Reserves to the minimum required as soon as possible.
In February 2020 the budget for 2020 was redrafted, assuming normal conditions, prior to the
onset of the Covid-19 restrictions. This provided for a reduced loss of €44,000. This budget was
circulated to members on 25 April 2020, together with the revised Audited accounts for 2019, and
detailed commentaries on both the revised Budget and the Revised Audited accounts.
The outcome for 2020 is substantially better than the original budget and is also better than the
revised Budget.
The Budget for 2021 requires approval by members at the annual AGM and the Estimates for 2022
and 2023 are provided to give an indication of the finances in those years and the challenges in the
longer term for the Club’s finances, particularly in regard to containing costs.
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1.1 Overview of the Audited Accounts results for 2020
The Income and Expenditure account is set out on page 9 in the Audited Accounts and shows that
the overall net result for the year, was a deficit of income over expenditure of €38,232. This deficit
is €61,976 less than the deficit recorded in the previous year of €100,208 and is also less than the
revised Budget deficit of €44,000.
As noted in the Management Committee report in the Audited accounts on page 3, the
Management Committee is satisfied to report that it was able to contain the overall loss for the year
at this amount bearing in mind the severe impact that the Covid-19 restrictions had on our
operations.
This result, which is better than budget was achieved, even though
– we suffered major losses in our Income including Green Fees and Competitions and
Sponsorships, down by €78K compared to budget (a 55% reduction)
– we had reduced Bar Turnover, down €204K compared to budget (a reduction of 57%) with
the resultant Gross margin from the Bar down €117K compared to budget (a 58% reduction)
Savings in various Overheads including payroll were achieved which helped reduce the effect of
these losses in income.
However additional non recurring costs of €43.8K were incurred in the year on Covid-19 related
costs, a Revenue settlement, and a provision for a Bad Debt, which made the task of balancing the
books all the more difficult.
Entrance fees were higher than budget.
We were able to claim a Covid-19 restart grant and rates rebate from DCC which helped reduce the
effect of the losses above.
All expenditure on Capital and Non recurring projects were cut back to a minimum so as to preserve
cash.
All Government and other assistance schemes including the TWSS and EWSS Wage subsidy schemes
were fully investigated and claims were made where possible. The TWSS scheme was operated on
behalf of our employees, whereas the EWSS scheme is a subsidy paid to the Club.
The Surplus for the year arising from operating activities was €40,149 which, when compared to
€70,790 in the previous year, shows a reduction of €30,641.
Cash at Bank at the end of the year was higher than at the end of the previous year.
The Cash Reserve Fund balance increased in the year by €21,620.
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1.2 Financial year 2020 results compared to Budget and previous year
Full details of the variances in the 2020 results when compared to the previous year and to budget
are provided in the Other Financial Information pack distributed with this report, pages 5-12 refer.
This pack shows the Financial results for the 2020 year; the Income and Expenditure account,
Balance Sheet, Cash Flow, Cash Reserve Fund, and detailed schedules supporting the Income and
Expenditure account including Income, Overheads, Bar trading, Non Recurring and Capital
Expenditure, and compares the 2020 accounts to both the 2019 accounts and the revised budget for
2020 issued after last year’s AGM.
1.2.1 Income and Expenditure for the Financial year 2020
Our main source of income (normally accounting for c. 90% of total income) is Members’
Subscriptions. Subscription income for 2020 is €31K higher than the previous year an increase of
2.6% and is €9.7K (0.8%) higher than the budget. The increase compared to the previous year is in
the main due to the increase in the Membership Subscriptions rate agreed at the AGM in January
2020, together with small other changes. The increase over the budget is due to higher
membership numbers than expected and is evidenced by the entrance fees received during the year.
Other Recurring Income for the year is lower than the previous year by €66K (50.8%), and is €78.2K
(55.1%) lower than the budget mainly due to lower green fees and lower income from competitions
and sponsorship, as a result of reduced golf activity arising from the Covid-19 restrictions.
The total of the above means that Total Operating income for the year at €1,253.5K
is €35.2K (2.7%) lower than the previous year and €68.5K (5.2%) lower than the budget.
Total Operating expenditure for the year which includes the Bar loss is €4.5K lower than the
previous year and €11.7K (1.0%) lower than the budget. If Bar Gross Profit is excluded there were
savings in Total Overheads of €124.3K (8.7%) compared to the previous year, and savings of €129.1K
(9.0%) compared to Budget.
Bar turnover for the year at €156.3K is €206.5K (56.9%) lower than the previous year and
€203.7K (56.6%) lower than the budget. There was a small reduction in the Gross Profit % achieved
at 54% compared to the previous year and the budgeted 56%. This was due to some stock going out
of date during the lockdown. All stock that could be returned for credit was returned to suppliers,
thus reducing the effect of the loss. However, with the reduced turnover, there was a reduction in
gross profit of €119.8K (58.6%), compared to the previous year and a reduction of €117.4K (58.1%)
when compared to the budget.
Bar wages were reduced by €56K (30%) compared to both the previous year and budget. The
reduced cost was due to reduced headcount, layoffs, reassignment of Bar staff, and the effect of
TWSS and EWSS supports.
Bar Fixed overheads including the apportionments of Rates, Insurance and Light & Heat were almost
the same as the previous year and the Budget.
The overall result for the Bar for the year, taking account of the lower revenue, the resultant
reduced gross profit and the lower payroll costs is a loss of €93.7K which is €65.1K worse than the
previous year and €59.7K worse than the budget.
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The losses in the Bar could be reduced by not charging the Fixed Overheads apportionment noted
above. However, these costs would then have to be charged elsewhere in the accounts, in
Clubhouse or General expenses. Although the Bar accounts would look better the overall result for
the year for the Club would be unchanged. I have set out in the Budget commentary below, how we
plan to deal with lower Bar revenues and resultant lower Gross Profits in the near future, particularly
while we are affected by ongoing restrictions due to Covid-19.
Course expenses for the year at €513.9K are €13.6K lower than in the previous year and
€34.1K (6.2%) lower than the budget. The main variances are due to the following: –
– Course payroll costs at €355.4K are €34.6K lower than the budget. This reduction was due to
reduced working patterns during lockdown, the effect of TWSS payroll support and some
temporary layoff of 2 staff during the first lockdown. Traditionally, we employ
temporary staff on the Course during the summer months; no temporary staff were
employed during the summer months in 2020.
– The Management Committee set as a priority that the Course would be maintained to its
usual high standard during lockdowns so that when restrictions were lifted members would
be able to enjoy the facilities without any delay or further disruption. We believe this was
achieved and was done so by careful planning by our Course Officer, General Manager and
Course Superintendent.
– The result of this decision was that Course overheads apart from payroll were almost on
budget. The total actual course overhead costs were €158.5K compared to the budget
€158.0K.
– There were variances in some of the overhead cost headings with overspends in some areas
being balanced by savings in others.
Clubhouse expenses for the year at €425.9K are €24.1K lower than in the previous year
(€450K) and €27.1K lower than the budgeted figure of €453K.
– As with the Course the main savings came in payroll and this was due to some layoffs during
the lockdowns, the effect of TWSS payroll support and reduced work patterns.
– The main saving in Clubhouse overheads compared to the budget came in Electrical &
plumbing repairs, TV and Cable costs, Repairs & maintenance and Cleaning & laundry.
– There were some overspends compared to budget on IT maintenance and licence
fees, Insurance due to higher premium cost and Water charges due to a leak in the Car Park
early in the year.
General expenses for 2020 at €88K are €26.2K lower than in the previous year (€114.2K) and €5K
lower than the budgeted €93K.
– The largest additional spend compared to the previous year and budget was in Legal and
Professional fees. The total charge of €18.4K includes the cost of a HR Consultant employed
in resolving a staff matter, advice received in relation to the operation of the TWSS payroll
scheme, advice received in relation to the Revenue disclosure made in the year, and Pension
scheme and Pension Trustees fees.
– There was also an increase in the total Audit fee charged in the current year of €9.3K as this
includes a higher charge for the current years audit and also an additional charge in relation
to the Auditing work on the amended accounts for 2019.
– The largest savings was in Team expenses where the total charge was just €2.1K a saving of
€29.5K compared to the previous year and €24.9K compared to Budget. This was the result
of almost no Inter Club golf activity in the year.
– The Social and Hospitality cost of €20.6K is lower than the spend in the previous year
(€27.4K) and also less than the budget of €22K. Almost all of these costs are normally
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incurred in the first half of the year, with costs relating to the Captains’ dinners held in
November, most Social events being held in the winter months, and the Drive Ins in January.
There were almost no Social & Hospitality costs incurred since mid-March 2020.
Security costs which relate only to night time security at €91.6K are €5.9K lower than the previous
year and €5.4K lower than the budget. This reduction in costs relates to the effect of the TWSS
scheme claims.
Non Recurring Expenditure for the year is broken into 5 categories of expenses.
– Course projects costs at €22.7K compare to the budget of €28K. A detailed listing is included
in the accounts. The signage work was carried out before Covid-19. The Trees work and
Fencing repair was carried out after the onset of Covid-19 and both were considered
essential and necessary on Health and Safety grounds.
– Clubhouse projects at €9.9K is higher than the budget €8K. Again, a listing is included in the
accounts. The deep clean of the kitchen was carried out before Covid-19. The repair of the
Course Toilet which was carried out after the onset of Covid-19 was unforeseen and was also
considered essential and necessary on Health and Safety grounds.
– Covid-19 related costs include the cost of deploying staff to undertake day time security
during the first lockdown and also the cost of sanitisation equipment and supplies
purchased, and printing costs in relation to Covid-19 signage.
– Revenue re payroll taxes, is the cost including interest and penalties of correcting an error in
processing payroll over a number of years. The error was discovered during the year and a
voluntary submission was made to Revenue to correct the error.
– Provision for Doubtful debts is in respect of the net amount owing to the Club by our
former caterer. The debt is still being pursued.
Other Income includes the following
– Entrance fees for the year at €77.2K are €11.9K less than the previous year (€89.1K) and
€27.2K ahead of the budget of €50K.
– Bank deposit interest at €5K is included on an accruals basis.
– Covid-19 Restart grant and Rates rebate amounted to €56.1K. This together with the effect
of the TWSS claimed for our staff and EWSS received, were critical in ensuring that the
overall loss for the year was held at €38.2K
Capital expenditure on Course machinery at €59.4K is €1.4K higher than the budgeted €58K. This
expenditure which is listed in the accounts, was committed prior to the onset of the Covid-19
pandemic.
Capital expenditure on Clubhouse equipment at €21.1K is €16.9K lower than the budgeted €38K.
This expenditure on the new Club v1 membership system, sound system and kitchen equipment
were each committed prior to the onset of the Covid-19 pandemic.
In summary, the overall deficit on the Income and Expenditure account for the year at €38K is
€62K (62%) lower than the previous year, and €5.8K (13.2%) lower than the budgeted loss of €44K.
1.2.2 Balance Sheet 31 October 2020
Fixed Assets are reduced in value compared to the previous year due to depreciation which was
budgeted.
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Current Assets
The stock figure at year end shows a decrease compared to the previous year end, as the Bar was
closed at the end of October and stock levels were reduced as a result.
There is a large increase in debtors and prepayments, (see the analysis in note 8 on page 17 of the
Audited Accounts).
The Debtors figure in 2020 includes the amount due from DCC for the Rates rebate noted above. As
noted in my report that accompanied the revised accounts for 2019, the debtors of €41,526 at the
end of 2019 should have been reduced by €22,677 being an amount due from a debtor which was
included in Creditors. A contra should have been processed before year end in 2019, and if it had
been processed prior to year-end, it would have resulted in the Debtors figure being reduced from
€41,526 to €18,849. This helps to explain the variance between the current years Debtors figure and
the amount reported for the previous year. In future years the Debtors figure should not be so high.
The 2020 prepayments of €78.9K are much larger than normal. Prepaid amounts are normally in
respect of expenses paid in advance, including rent, rates, insurance, and maintenance contracts.
The prepayments in the current year includes the restart grant noted above of €37.5K. This amount
has been received into our Bank post year end. Again, I expect that the prepayments figure will be
lower in future years.
In Current Assets, there is also a change in Cash at Bank and in hand, which has increased from
€520K in the previous year to €530K in the current year. Full details of the movement are set out in
the Cash Flow statement.
The Creditors – amounts falling due within one year, have increased from €282.8K in the previous
year to €291.1K in the current year. The analysis in note 10 on page 18 of the Audited Accounts gives
the breakdown between Trade Creditors and Accruals.
The Trade Creditors figure in the current year are lower than normal as we were not purchasing Bar
supplies in October.
On the other hand, Accruals have increased substantially partially due to the large amounts of Bar
credits being unused at year end.
Taxation shows a decrease due to timing at the end of the previous year. All amounts of tax
liabilities due at year end were paid in November, post year end.
Creditors – amounts falling due after more than one year are Members’ Loans of €32,560. Note 11
on page 18 in the Audited accounts give the complete detail on these Loans.
The reduction in Revenue Reserves of €38K, is the loss for the year.
1.2.3 Cash Reserve fund at 31 October 2020
The Cash Reserve Fund at the end of the 2020 year is €317.7K compared to €296.1K at the end of
the previous year, an increase of €21.6K in the year. The closing balance is €22.3K short of the
minimum required to be maintained, €340K, as set out in the Accounting Policy (n) on page 14 of the
Audited Accounts. Further reference to the status of the Cash Reserve Fund is made in the
commentary on the Budget for 2021 and Estimates for 2022 and 2023 below.
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2.1 Overview of the 2021 Budget
Each year, the budget for the following year is required to be approved by members at the AGM.
The Budget for the 2021 year achieves a better than Cash Neutral position.
The 2021 budget details the following
– A cash surplus arising from Operating activities of €61K
– A budgeted total deficit for the year of €13K, after accounting for entrance fees,
depreciation, and Capital and Non Recurring expenses.
– A cash flow surplus on all activities of €41K.
– A budgeted closing Cash Reserve at the end of 2021 of €364.7K, a surplus of €24.7K
compared to the minimum required of €340K
With the great uncertainty arising from the current Covid-19 pandemic the task of preparing budgets
is much more difficult than normal, and therefore the choice of assumptions is more important than
ever. The main assumptions are set out below.
2.2 Review of the 2021 Budget
2.2.1 Budget 2021 – context
In framing the 2021 budget the Management Committee were conscious of
• the trends emerging from the monthly management accounts.
• the severe impact of different levels of Covid-19 restrictions, reducing the normal scale of
usual Club activities, as reflected in our financial results in the 2020 year.
• the likelihood of different levels of Covid-19 restrictions continuing for most if not for all of
2021.
• the changing patterns in the demand for Club services, with increased use of course and
bowling green by members, reflected in the pressure on timesheets.
• the need to keep the maintenance and upkeep of the golf course, bowling green and
clubhouse as a priority in setting the budget.
• the need to keep all costs within our discretion to a minimum and at a level which we can
afford.
• the need to continue to achieve at least a cash neutral position in our finances, and
• the need to be able to scale up Club activities across the board in line with any lifting of
Covid-19 restrictions.
In addition, all lines of expenditure have been carefully reviewed from an efficiency / competitive
angle, so as to ensure maximum savings where possible.
2.2.2 Budget 2021 – Critical assumptions
We are assuming that there will be some level of restrictions due to Covid-19 during most if not all of
the 2021 year.
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Subscriptions: – we are proposing no increase for 2021 in the amount of membership subscription
due for each category of member, and have based the total amount receivable on current invoicing.
Entrance Fees: – mindful of the demand for timesheet spaces while in the grips of Covid-19, we are
proposing that as a short-term policy, we will limit new entrants while in Covid-19 mode to be direct
replacements only of those vacating membership due to moving membership category, terminating
membership or deceasing.
Green Fee income: – again mindful of the demand on timesheets, we are proposing to limit the
number of Green fees and societies in 2021.
It is hoped that members will see the above proposals as an attempt by the Management
Committee not to erode their ability to enjoy their playing activities.
Competitions and Sponsorship: – assuming that some restrictions are likely for most of next year we
are budgeting for the likelihood of more social golf and less competitions, thus resulting in reduced
income from both competitions and sponsorship. However, every effort will be made to have as
many competitions as possible run as normal as in previous years.
Bar turnover: – with the knowledge of the actual Bar turnover pattern in 2020 after the initial
lockdown, we are expecting a much-reduced level of activity in the Bar. While maintaining the
current GP% this will yield a much-reduced Bar Gross profit.
Bar payroll: – we are proposing that as a policy, bar payroll cannot exceed Bar Gross Profit. This will
require a major change in Bar staffing, and rostering and may result in changes in Bar service and
opening times.
Payroll: – we are proposing that payroll basic rates for 2021 will be held at the 2020 levels for all
employees. A review of all elements of payroll has been undertaken to ensure that the minimum
levels possible will be spent next year.
2.2.3 Budget 2021 – Detailed notes on assumptions
Income and Expenditure
Subscription Income
The Management Committee are very aware of the hardship that the Covid-19 virus has caused to
many people including some of our members.
In normal circumstances it is assumed in the Budget that a Motion to increase the Annual
Subscription will be passed at the AGM. For 2021 we are proposing no increase in the Annual
Ordinary members’ subscription. As a result, there will also be no increase in the annual
subscription in 2021 for any other category of member.
Hence, the total revenue generated from subscriptions in the budget is based on current
membership and rates of subscription as billed on 1 November 2020. This has incorporated
adjustments for normal changes in membership categories for the 2021 year.
Other Operating Income
The extent and timing of when the golf course, bowling green and clubhouse facilities will be open to
members is unknown at this stage and as noted above, makes preparing the budget all the more
difficult. We know from summer 2020, the huge increased interest among members in playing golf
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and bowls under restricted circumstances and the consequential reduction in scope for accepting
visitors and the resultant reduced income from green fees.
Members’ interests are a priority over visitors and, as a consequence, we are planning to
– cut back on the number of green fees and societies, so that members will have greater
access to our course. We are planning a reduced income figure of €30K for Green fees and
societies. This assumes the same unit price for green fees as at present and lower volume.
– accommodate more social golf if this is a requirement of Government restrictions. This
would have an effect on Competition income and sponsorship and we have budgeted
reduced income for these and included €25K for next year.
– provide facilities so that the Men’s club, Ladies club and Bowling club will be in a position to
run Competitions during the year when Government restrictions allow.
These sources of income are very important to us and the situation will be reviewed during the year
as circumstances change.
Overall Total Operating income, for the year is budgeted at €1,265K a marginal increase over the
2020 total.
Total Operating Expenditure for the year, including the Bar loss, is budgeted at €1,204K, a small
decrease on the 2020 actual total of €1,213K. This includes a provision for increased spending on
payroll as we cannot assume that there will be any Government supports available for staff in the
new year, and also a reduction in the loss on Bar trading recorded in 2020.
Bar Trading
Based on the trading experience in the bar over the course of 2020, we are estimating a large
decrease in Bar sales for 2021; a total revenue of €240,000 which would yield, in the normal course,
a Gross Profit of €134,000.
As noted above, we have adopted a policy regarding Bar payroll, as we believe that we cannot afford
to run the Bar at an operating loss. Loss in this instance is measured as the Gross Profit less the Bar
payroll. So, the maximum expenditure we can afford on payroll is the projected Gross Profit i.e.,
€134,000.
This payroll cost includes the continuing allocation of some house and administration payroll costs as
currently in place.
This requires a major review of our traditional bar arrangements as regards opening hours and staff
rosters and other cost issues. The House Committee and the General Manager are working on this as
a matter of urgency.
Other overheads currently charged to the Bar, including Rates, Water rates, Insurance, and Light &
heat will continue to be charged as in previous years.
If and when Covid-19 restrictions are relaxed, the Management Committee will gradually reopen the
bar and catering arrangements as they are key elements of the service / product we offer to
members. However, the requirement that Bar payroll will not exceed Bar Gross profit will remain in
place. This may have an ongoing effect on service.
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Course expenses
The Management Committee consider that the maintenance of our Course and Bowling green are a
priority.
The major element of the course recurring budget is payroll, accounting for c. 70% traditionally. We
have provided for some changes to staff costs including overtime and temporary costs so as to
achieve a small reduction in course payroll costs in the coming year compared to the budget for
2020.
The remaining course costs are overheads and these are largely unchanged. These are deemed
necessary for proper course and bowling green maintenance. The budget for Course overhead
expenses excluding payroll at €157K compares with €169.4K spent in 2019, and €158.5K spent in
2020.
Clubhouse expenses
Most Clubhouse expenditure, apart from payroll, is externally determined and every effort is being
made to reduce costs and increase efficiencies by obtaining competitive quotes where possible. IT
expenditure is a priority given the changes that are already underway / committed to modernise our
systems.
The total budget for Clubhouse expenses including payroll at €452K compares with €450K spent in
2019, and €425.9K spent in 2020, when payroll costs were reduced as detailed in the account’s
commentary.
General expenses
Expenditure on social functions is not provided for as it is difficult to see large gatherings for same
until the Covid-19 situation has been resolved. Provision has been made for some limited hospitality
costs during the year. No provision has been made for the costs associated with Captains dinners, as
these normally happen in November which will fall into the 2022 accounts.
The budget for team expenses has been reduced compared to 2019, as it is expected to be at a
minimal level compared with previous years.
A provision has been made for the Audit fee based on the quote for the current year’s audit.
The overall budget for General expenses at €73K compares with €114.2K spent in 2019, and €87.9K
spent in 2020.
Security expenses
Costs are being maintained at current levels. Again, the budget for 2021 is higher than the actual for
2020 when payroll costs were reduced due to the effect of the TWSS scheme.
Non recurring expenditure and Capital expenditure
Previously non recurring expenditure was included as Capital expenditure. In the revision of the
2018 and 2019 audited accounts, non recurring expenditure including work on the Trees project and
renovation of the 1st tee were classified separately as Non recurring, rather than Capital
expenditure.
Currently and in the future, Capital expenditure will only be used for Expenditure on assets that
would have a resalable value.
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Expenditure on both non recurring and Capital items is being kept to a minimum. Items have only
been included in the Budget if they are deemed absolutely necessary.
As a result, many items requested to be included this year by the Course Officer and the House
Officer have not been included in the attached budget. However, they remain as items requiring
funding in future years and are therefore considered to be deferred at this time for consideration in
2022 and 2023. The funding required for undertaking these expenditures will place pressure on the
Club’s finances in those years.
The items considered as priority for the coming year are listed in the Budget pack.
Non recurring course expenditure
The trees project work will only be undertaken if it is deemed that there is a risk requiring action.
Irrigation work is considered to be necessary to maintain the course.
Non recurring house expenditure
Painting in the kitchen area is considered a health and safety requirement.
Replace timber and painting the side of the Pro Shop is considered necessary to avoid further
deterioration.
Investigation and fixing the leak in the roof of the Concourse is also deemed necessary to avoid
further damage.
Capital expenditure course machinery
The sod cutter is a replacement item and is absolutely necessary.
Capital expenditure clubhouse equipment
Installation of a security gate at the entrance is considered a priority particularly if there are further
lockdown situations so as to avoid unnecessary visitors coming onto our property.
The Kitchen equipment as listed is considered to be a minimum requirement again as a health and
safety matter.
Entrance Fees
As noted above we are budgeting for new members in various categories only to provide for the
replacement of those vacating membership. Based on the recent history of membership changes we
have included €40k as our Budget for 2021.
In summary, the overall deficit in the budget Income and Expenditure account, including the Non
Recurring and Capital Expenditure for the year 2021 is a total of €13K.
Balance Sheet
A budgeted Balance Sheet is included in the Budget pack on page 3 and the following are the
reasons for changes in the budget figures for 2021 compared to the actuals in 2020.
Fixed Assets will be reduced in value compared to 2020, due to depreciation per the budget.
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In Current Assets, the Stock figure should be back to normal levels providing there is no lockdown at
the year end.
In Current Assets, there should be a decrease in Debtors and prepayments. As noted in the
accounts review, in section 1.2, there was a debtor at the end of 2020 in respect of the Rates rebate
which should not be the case next year. It is assumed that this debtor will be fully paid in the 2021
year. It is also assumed that the prepayments at the end of 2021 will be lower than 2020 as the
Restart grant has since year end been paid. Based on this, it is assumed that Debtors and
prepayments will reduce by €30K in the year.
In Current Assets, the Cash at Bank and in hand is shown to increase in the year by €41K, as set out
in the Cash Flow statement.
It is estimated that the Creditors – amounts falling due within one year will decrease by €30K by the
end of the 2021 year, due mainly to lower Bar credits resting in members’ accounts at that time.
Creditors – amounts falling due after more than one year are Members’ Loans and it is assumed
that these will be unchanged during the year.
The budgeted reduction in Revenue Reserves is due to the loss budgeted for the year.
Cash Reserve Fund
The Cash Reserve Fund at the end of the 2021 year is estimated to be €364.7K compared to €317.7K
at the end of the 2020 year. This is a surplus over the required balance of €340K of €24.7K
Cash Flow statement
This budget gives an estimated positive cash flow outcome for 2021 of €41K.
3.1 Overview of the 2022 and 2023 Estimates
In the Budget pack, the Estimates for 2022 and 2023 are set out beside the Budget for 2021, allowing
for easy comparison to: – the Budget for 2021 and the Budget and actual results for 2019 and 2020.
These Estimates give a general perspective on the Club finances over the coming years and provide a
basis for planning our future. After paying the day to day operational costs, we aim to have a surplus
on operating activities which, in addition to funds generated from entrance fees, will allow us to
fund Capital and Non Recurring projects. Such expenditure is vital if we are to maintain standards on
the Course and Bowling Green and in the Clubhouse. The level of funding does, however, not
represent a commitment to any particular project. Commitments to projects must be based on
actual funding being available and be approved by members at the AGM each year in advance of the
spending taking place.
As with the Budget for 2021, the Estimates have been prepared on the assumption that they must
result in Cash Flows that ensure that the minimum balance required is maintained on our Cash
Reserve Fund.
As noted in the budget 2021 notes above, the 2021 Budget gives a Cash positive outcome and, as a
result, the deficit on the Cash Reserves Fund at the end of 2020 is budgeted to be eliminated in
2021.
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Overview & Assumptions
With the continuing uncertainty arising from the current Covid-19 pandemic the task of preparing
Estimates for 2 and 3 years ahead involves a lot of guess work with regard to assumptions. The main
assumptions are set out below.
Important commentary – Income from Subscriptions
As noted in the budget commentary above if we were in normal circumstances, we would be
recommending an increase in subscriptions for 2021 so as to maintain the Club facilities at the high
standards we expect and enjoy.
However, given the current Covid-19 situation, it is being recommended that this increase be
deferred until the financial year 2022.
While it is accepted that we should budget for no increase in Subscription income in the coming year
it is critical to note that the normal increase deferred will be required to be collected in the following
year together with the normal increase that would normally be needed in that year also so that we
can maintain standards in the post Covid-19 era.
A €50 increase on the current Ordinary members subscription of €1,445 is 3.46%, and if applied
would increase Subscription income by c. €42k. Unless this is done it will mean a loss annually in
income of c. €42k.
This annually will pay for quite an amount of Capital expenditure and non recurring costs, that will
not be possible unless it is collected.
In the Estimates for 2022 and 2023 we are assuming that subscriptions will increase by 7% in 2022
over the current rate and by a further 3.5% in 2023.
These are not proposed increases; it is an indication only and provides a basis for the likely funding
that will be available for necessary Capital spending in those years. When the detailed budgets are
prepared for each of these years, they will be presented to each AGM with accompanying
supporting motions for members’ consideration regarding subscription increases if they are deemed
necessary at that time in any year.
3.2 Review of the 2022 and 2023 Estimates
The following are the key line assumptions used in compiling the Estimates.
Subscriptions are shown to increase by 7% in 2022 and 3.5% in 2023 as detailed above.
We expect that there will be some recovery in Other Operating Income mainly in green fees and
competition and sponsorship income. The green fees income may be achieved by increasing the
price charged.
Total Operating Expenditure including the Bar loss for 2022 is expected to rise by €64K (5.3%)
compared to the budget for 2021 and by a further 1.9% in 2023. The main areas for increased
spending are in team expenses and Social and Hospitality costs as set out below.
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Bar Trading
We expect that in 2022 Bar trading will continue to recover, but do not expect that it will return to
the 2019 level until 2023. Gross profit is planned to be held at the customary 56%. As set out above
Bar Payroll costs are planned to be maintained at a maximum amount no greater than to the Gross
Profit earned in the Bar. Bar losses therefore should not exceed the apportionment of other
overheads.
Course expenses
Payroll generally accounts c. 70% of Course expenses, and a 3% increase has been provided for both
years in the Estimates.
Other course overheads which in 2020 were lower than in 2019, and which in 2021 are expected to
be held at about last year’s level are expected in 2022 to be equal to the 2019 cost with a small
increase on that figure in 2023 (2.3%).
Clubhouse expenses
Payroll generally accounts for c. 40% of House expenses, and a 3% increase has been provided for
both years in the Estimates.
In Clubhouse overheads we have provided for increased cost in Laundry & cleaning and TV & cable
services in 2022 when it is hoped that normal usage of the clubhouse will return.
General expenses
Only minimal expenditure on social functions is provided for in the 2021 budget. It is hoped that in
2022 and 2023 that normal functions including Captains dinners, Captains Drive-Ins, and other Social
functions will return and allowances have been made for the cost of these events.
Similarly, the budget for team expenses has been reduced in the 2021 Budget. It is hoped that in
2022 and 2023 that normal inter-club activity will be resumed and provision has been made for the
cost of same.
Security expenses
Payroll increases at 3% have been provided for both years in the Estimates.
Surplus arising on Operating activity
With the above, the Surplus arising on Operating activity, is estimated in 2022 to be €140K, and to
be €172K in 2023 (compared to the Budget €61K for 2021).
It is assumed that Entrance fees for 2022 and 2023 will be €50K each year. Consideration will be
given to increasing the amount of the Entrance fee charge going forward so as to achieve these
Estimates.
The total of surpluses arising from Operating activity and Entrance fees are required to fund ongoing
Non Recurring and Capital Expenditures on both the Course and the House.
Many Non Recurring and Capital expenditure projects have been put on hold in 2020 and again
deferred as noted above in the Budget commentary for 2021. This deferment cannot continue
indefinitely as it will impact on our ability to maintain standards.
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In these Estimates for 2022 and 2023, we have included the minimum requirement only as we see it
at this time. These items are listed in the schedules in the Estimates pack.
In December 2019 the Management Committee set the Budget for 2020 and the Estimates for 2021
and 2022. At that time, we planned total Capital and non recurring expenditure for those 3 years of
an estimated €658K. In 2020 the total spend was €113K, and with the continued uncertainty around
the Covid-19 effects we have planned for minimal expenditures in the Budget for 2021 of €55K and
in the Estimate for 2022 of €151K, and in the Estimate for 2023 of €132K a total of €451K.
Some €207K of the Estimates agreed by the Management Committee 12 months ago for spending
over a 3 year period has not been spent and is now not budgeted or estimated to be spent over a 4
year period.
As noted earlier unless continued spending on Non recurring and Capital projects is undertaken then
our ability to maintain standards diminishes.
If the surpluses in the 2022 and 2023 Estimates are likely to be achieved, then they will allow the
Management Committee to include in the budgets for those years further spending which has been
requested by both the Course Officer and House Officer.
Depreciation has been reduced in the Estimates for 2022 and 2023, as some fixed asset items will be
fully written off in 2021.
In summary, an overall breakeven outcome is estimated in the Income and Expenditure account for
the year 2022 and for 2023 a surplus of €52K. As noted above should these materialise in the
Budgets for those years some Capital Expenditure and Non Recurring expenditure deferred as noted
above will be included in the budgets for those years. The Management Committee at that time will
prioritise which expenditure will be proposed and include that for approval by the members at the
AGMs in 2022 and 2023.
Estimated Balance Sheets are included in the Budget pack for the years 2022 and 2023 and the
following comments are relevant in considering them.
Fixed Assets are reduced in value due to depreciation.
It is assumed that Current Assets of Stock, Debtors and prepayments, Creditors – amounts falling
due within one year of Trade Creditors and accruals and Creditors – amounts falling due after more
than one year (Members’ Loans) will remain unchanged over the 2 years 2022 and 2023.
In Current Assets, the Cash at Bank and in hand is estimated to increase in 2022 by €40K, and by
€91K in 2023.
The Cash Reserve Fund balance is estimated to be €405K at the end of the 2022 year. This is
greater than the minimum required balance of €340K. It is estimated that this balance will be
€495K at the end of 2023. As noted above these balances will be reduced if additional Capital and
Non Recurring Expenditure is undertaken as set out above.