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The Quarterly


Finance and Audit Committee Annual Report Print E-mail
The Quarterly 2011

I am pleased to table the Annual Report for 2010-11. With respect to the 2010/11 Financial Report consolidated audited accounts, I am pleased to report that the College’s Auditor, Morton, Watson and Young, has provided an unqualified audit report for the year which was received by the Board at its meeting on 19th August, 2010.

The Finance and Audit Committee has continued to meet on a quarterly basis during the year, reporting to the elected Board. The Board identified a number of key priorities in its 2010-2012 Strategic Plan, which is available on the website, several of which have been implemented successfully. The most notable is the commitment to develop training programs and other sources of revenue to reduce to the degree possible the reliance on Member’s fees. In the 2009-10 financial year membership subscriptions accounted for 70% of revenues and the Board had set a target of reducing that to 60% for 2010-11. I am pleased to report that RACMA successfully tendered for a number of projects and the outcome was that Membership subscriptions accounted for 47% of the total revenue for the year. I’d like to highlight some of the major revenue gains made from projects and other sources as summarised in the Profit and Loss Statement for 2010-11.

  1. Since February 2010 when RACMA launched the Accelerated Pathway training program for experienced clinical colleagues who are completing the FRACMA as a second fellowship, there was considerable interest in 2010-2011 resulting in two cohorts of doctors enrolling in the last year and a further two cohorts this year. Applications closed on the 30th September, 2011 for the fourth cohort which received 24 applicants. It is proposed to move the Candidate and Accelerated Pathway intakes to an annual calendar year basis. In 2010-2011 these activities generated revenue of $400,851 as a relatively new revenue stream.

  2. A number of proposals were successful in gaining project work and funding resulting in revenue of $310,034 in 2010-11 as compared to $53,350 in the previous year. These included the following:
    • Phillips Fox had successfully tendered for the Victorian Health Department’s project “Partnering for Performance” to develop medical leaders, and engaged RACMA as a partner in that project in 2010. The collaboration with Phillips Fox continued in 2011 with the successful tender of a follow-up project resulting in further revenue.
    • Under the Commonwealth’s Specialist Training Program (Phase 1) STP1, which sponsors three RACMA Training positions in private hospitals, RACMA applied and received funding again in 2010-11 to administer and support that training program. RACMA has been advised that as of next year the Commonwealth will be funding a total of six training positions.
    • RACMA was invited by the Commonwealth Department of Health and Aged Care to submit a proposal for the contract management and disbursement of Government funding in support of the infrastructure needs and supervision of trainees in the Specialist Training Program (Phase 2) STP2. An amount of $6,623,755 was received in July 2011, which is reported in the Financial Statement under Item 5 “Trade and Other Receivables”. These funds are being invested in term deposits at 6.01% pending their disbursement to private sector parties who have trainees from across all Colleges in their employ under the training scheme. Dr Karen Owen is congratulated for singlehandedly achieving this project. It’s meant doubling the size of the Secretariat for the duration of the program.
    • Under the Rural Health Continuing Education Program, RACMA is developing a Peer Review/360o web-based assessment tool for CEP titled “Enhancing Performance through Self Audit and Peer Review”.

    As the projects are delivered in the current financial year, further revenues are anticipated.

  3. The revenue from Seminars, Courses and Meetings was $180,229, up from $46,796 in the previous year.

  4. As interest rates increased in 2010-11 RACMA’s term deposit investments attracted $117,817 as compared to $46,306 in the previous financial year.

  5. The Conjoint Conference with the Hong Kong College of Community Medicine proved to be a huge success and generated income of $43,024 as compared to $16,149 the previous year.

These activities were key to generating a profit of $641,732 in 2010-11 compared with $85,930 in 2009-10.

Expenses in the Financial Statement reflect the increased activities of the Board and its Committees supported by the Secretariat. The major difference of note is that RACMA now owns the premises in Milton Parade and the rent previously paid reverted to nil, with considerably reduced Body Corporate fees by comparison. There were two lots of examinations during the year with consequent increases in costs. Dr Karen Owen continues to ensure that costs are contained to the degree possible given the need to support the Committees and Board.

The budget for this financial year is based on conservative measures. There was a 5.0% increase in Fellows fees and a 4.0% increase in Candidate fees. The revenue from the Accelerated Pathway program and the first year for the Associate Fellow program is forecast to increase revenue by another $134,473. As already mentioned there are two cohorts of Accelerated Pathway candidates with 24 people in the latest group, and there are 14 people enrolled in the Associate Fellow program. Investment returns were left at an estimated 4.0%. A small profit from the Annual Conference is included.

For this financial year the Board’s first priority was to ensure that all the work is completed in time for our scheduled re-accreditation by the Australian Medical Council (AMC) in August 2012. A contingency of $140,000 is included in the budget for that purpose. Even with these conservative estimates the budget provides a small surplus of $1,280.

In planning for the next financial year, a number of priorities as set out in the RACMA Strategic Plan 2010-2012 will be reconsidered by the Board. Of particular note is the work that is already under way in regard to the College Curriculum which will embrace the teaching of research in our field as required by the AMC. The Board had previously considered commissioning research to contribute to the body of knowledge about medical leadership, and the added value of the College Fellowship in this regard through a potential collaboration supported by the Australian Research Council.

Another priority is to allocate funds to develop on-line training resources for Candidates and the Continuing Education of Fellows. In this regard the webinar series have proven a success.

I wish to thank the Members of the Finance and Audit Committee, Drs Richard Ashby, Michael Walsh, and Roger Boyd. I also wish to thank the Chief Executive Dr Karen Owen for her commitment and efforts on behalf of the College. It is largely due to her efforts that the College is now recognised as a project resource by the Commonwealth and Victorian governments. I commend the Annual Financial Report to Fellows and Members for endorsement.

Dr Draginja Kasap
Chair, Finance and Audit Committee

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