Audit opinion Independent Governance Committee of the ... · PDF file2 Notes to the IGC...
Transcript of Audit opinion Independent Governance Committee of the ... · PDF file2 Notes to the IGC...
Independent Governance Committee (IGC) ofthe Fédération Internationale de FootballAssociation (FIFA)
Report of the auditor to Managementon the specific elements of a financialstatement of the IGC (IGC financialelements) as of 31. December 2012
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Report of the auditorto the Management ofBasel Institute on Governance and FIFA
On your instructions, we have audited specific elements (Balance sheet, Profit and loss account andnotes) of the funds provided by FIFA for the independent operation of the IGC (IGC financial ele-ments) for the period from January 1 to December 31 2012.
The Basel Institute on Governance Responsibility
The Basel Institute on Governance is responsible for the preparation of the IGC financial elements inaccordance with generally accepted Swiss accounting principles (Art. 957 f OR) and the accountingprinciples in the notes. This responsibility includes designing, implementing and maintaining aninternal control system relevant to the preparation of IGC financial elements that are free from mate-rial misstatement, whether due to fraud or error. The Basel Institute on Governance is further respon-sible for selecting and applying appropriate accounting policies and making accounting estimates thatare reasonable in the circumstances.
Auditor’s Responsibility
Our responsibility is to express an opinion on the IGC financial elements based on our audit. Weconducted our audit in accordance with Swiss Auditing Standards. Those standards require that weplan and perform the audit to obtain reasonable assurance whether the IGC financial elements are freefrom material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the financial statements. The procedures selected depend on the auditor’s judgment, including theassessment of the risks of material misstatement of the financial statements, whether due to fraud orerror. In making those risk assessments, the auditor considers the internal control system relevant tothe preparation of IGC financial elements in order to design audit procedures that are appropriate inthe circumstances, but not for the purpose of expressing an opinion on the existence and effectivenessof the internal control system. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of accounting estimates made, as well as evaluating the overallpresentation of IGC financial elements. We believe that the audit evidence we have obtained is suffi-cient and appropriate to provide a basis for our audit opinion.
PricewaterhouseCoopers Ltd, St. Jakobs-Strasse 25, Postfach, 4002 BaselTelephone: +41 58 792 51 00, Facsimile: +41 58 792 51 10, www.pwc.ch
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Opinion
In our opinion, the IGC financial elements for the year ended 31. December 2012 comply with gener-ally accepted Swiss accounting principles (Art. 957 f OR) and the accounting principles in the notes.
PricewaterhouseCoopers Ltd
R. Maiocchi M. Scheibli
Audit expert
Basel, April 29, 2013
Enclosure:
- Financial statements (balance sheet, income statement and notes)
Balance Sheet at 31. December 2012
(in CHF)
Assets Liabilities
Cash 8'073.80 Liability to BIOG 9'136.60
Other receivables 122.95 Accrued expenses 75'000.00
Receivable from FIFA 75'939.85
84'136.60 84'136.60
Profit and Loss account for the period from 1 January 2012 till 31. December 2012
(in CHF)
Committee member fees -560'000.00
Transport -149'500.15
Hotel & meals -45'516.45
-755'016.60
Financial result 156.88
Other expenses -15'080.13
-769'939.85
Administration expenses -35‘025.00
Total expenses -804'964.85
Administration contribution FIFA 35‘025.00Advance payment FIFAaccording to the budget. 694.000.00
729‘025.00
Outstanding receivable FIFA -75'939.85
1 Notes to the IGC financial elements
Notes to the IGC financial elements
The Basel Institute on Governance has prepared the IGC financial elements
in accordance with generally accepted Swiss accounting principles
The costs of the Independent Governance Committee (IGC) have been accounted for in five
categories:
Committee member fees
Transport
Hotel & meals
Other expenses
Administration expenses
Committee member fees
The IGC agreed with Fédération Internationale de Football Associations (FIFA) on a standard daily fee
of CHF 5’000 per meeting day. This fee includes travel time and additional time spent for phone
conferences, reviewing documents as well as on contributing to and reviewing the IGC reports and
press releases. The Basel Institute on Governance (BIOG) monitored the time contributions of each of
the IGC members and compensated them accordingly. The IGC members received a total of CHF
560’000 of fees during the reporting period.
The BIOG agreed with FIFA, that any applicable taxes (e.g. VAT, withholding tax) and/or social
security contributions on the individual member fees are under the responsibility and management
of FIFA.
The composition of the IGC is summarized below.
Alexandra Wrage, founder and President of Trace International (Trace), waived any compensation for
member fees as well as reimbursement for transport, accommodation and any other cost.
The member fee for Prof. Mark Pieth was invoiced by and paid to the University of Basel.
Transport
Flight arrangements are based on business class and were arranged by the BIOG. Additional
transport expenses, such as taxi, were reimbursed to the IGC members against corresponding
receipts. A total of CHF 149’500.15 was spent for transport cost during the reporting period.
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Hotel & meals
Hotel arrangements and meals were prepared and booked by the BIOG. A total of CHF 45’516.45 was
spent for hotel accommodation and meals during the reporting period.
Other expenses
A total of CHF 15’080.13 was spent during the reporting period on various items, including auditor
fees, courier and printing services.
Administration expenses
The BIOG charged a total of CHF 35’025 during the reporting period for monitoring the IGC account
and for performing administration services, including bookkeeping and travel/meeting logistics.
Organization of the IGC
Purpose
The purpose of the IGC is to oversee the creation and implementation of a framework of good
governance and controls for FIFA to ensure the organization’s integrity with the ultimate goal of
restoring confidence amongst all FIFA stakeholders, including fans and the wider public.
FIFA has delegated to the IGC the power and authority necessary to discharge its purpose, including
but not limited to the right to assess FIFA’s response to allegations of past and current misconduct,
and, if appropriate, to recommend further investigation. FIFA’s practices should conform to
applicable corporate and regulatory governance principles, including requirements relating to
transparency, independence, accountability, fiduciary responsibilities, and management oversight.
The IGC monitors FIFA’s governance reform process, reviews and assesses the work by the FIFA Task
Forces and the FIFA administration, submits corresponding proposals to the competent FIFA
institution (e.g. FIFA Executive Committee, FIFA Congress) and ensures their implementation.
The IGC acts and decides in full independence and based on its own discretion. The IGC decides
autonomously on its composition, decision-making, work processes and scope. The success of IGC’s
efforts is dependent on the full co-operation, openness and support by FIFA; The IGC reserves the
right to terminate its role in the event that such conditions are not fulfilled.
Composition
In November 2011, FIFA asked Prof. Mark Pieth to establish a group of independent governance
experts and stakeholder representatives to overview and support FIFA’s reform process. After a
3 Notes to the IGC financial elements
thorough and intensive search and selection process, including due diligence on candidates, Prof.
Pieth presented a group of 13 persons to form the IGC; 6 members representing the legal, the
compliance and the investigation disciplines and 7 members representing various football
stakeholder groups , i.e. Member Associations, Leagues, Clubs, Players, Media and Sponsors. The
FIFA Executive Committee acknowledged in its December 2011 meeting the composition and
independent role of the IGC and FIFA acknowledged IGC’s self-developed charter document on
January 27, 2012.
During the reporting period, one member left the committee. In May 2012, Lydia Nsekera, President
of the Football Association of Burundi, decided to step down as a member of the IGC in order to
preserve the independence of the IGC, after she had been elected by the FIFA Congress as a member
of the FIFA Executive Committee. The IGC decided not to replace the seat of Ms. Lydia Nsekera on
the IGC, since FIFA’s member associations are still represented at the IGC. As of December 31, 2012,
the IGC consisted of 12 members.
Provision of funds
The operation of the IGC in accordance with its purpose is connected with certain costs (e.g.
administrational/logistical/time efforts); FIFA provides the funds necessary to operate the IGC. In
order to ensure the independence of the IGC, the financial relationship is managed at an arm’s length
basis and the BIOG acts as a trustee.
In consultation and agreement with the IGC, BIOG produces budgets relating to the operation of the
IGC. FIFA transfers the budgeted amounts to a separate and discretionary bank account of BIOG in
Switzerland. BIOG is obliged to solely use the funds for the operation of the IGC, as defined and
required by the IGC, using the discretionary bank account for all corresponding transactions.
Controls
An independent external audit firm mutually agreed between FIFA and the IGC shall perform annual
audits on the use of funds provided by FIFA. FIFA and the IGC both receive the audit reports; the IGC
decided to publish the audit reports. BIOG is obligated to fully disclose at any time all relevant
transactions to the auditor, FIFA and the IGC.