WORLD WIDE FUND FOR NATURE MALAYSIAawsassets.wwf.org.my/downloads/wwf_malaysia_audited... ·...

WORLD WIDE FUND FOR NATURE MALAYSIA(Incorporated in Malaysia)

CONTENTS PAGE

Chairman's Statement 1 - 2

Statement by the Trustees 3

Statutory Declaration 3

Independent Auditors' Report 4 - 5

Balance Sheet 6

Statement of Income and Expenditure 7 - 8

Statement of Receipts and Payments 9 - 10

Notes to the Financial Statements 11 - 21


BALANCE SHEETAS AT 30 JUNE 2016

Note 2016 2015RM RM

NON-CURRENT ASSETS

Property, plant and equipment 3 9,201,885 9,772,3809,201,885 9,772,380

CURRENT ASSETS

Inventories 4 171,998 170,855Sundry receivables 5 1,934,661 1,000,781Fixed deposits with licensed financial institutions 6 20,800,000 20,800,000Cash and bank balances 4,612,433 6,353,716

27,519,092 28,325,352

CURRENT LIABILITY

Sundry payables 7 3,813,379 4,987,7683,813,379 4,987,768

NET CURRENT ASSETS 23,705,713 23,337,58432,907,598 33,109,964

REPRESENTED BY:

FUND ACCOUNTS 8 32,907,598 33,109,964

The accompanying notes form an integral part of the financial statements.

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STATEMENT OF INCOME AND EXPENDITUREFOR THE YEAR ENDED 30 JUNE 2016

2016 2015RM RM

INCOME

Donations 25,320,822 23,438,770Grants - International grants 11,222,463 14,116,621Events, promotions and sale of images and inventories 387,923 1,603,466Gain from disposal of property, plant and equipment 2,200 50,427Gain on disposal of investment - 32,530Reversal of provision for diminution in value on

long term investments - 60,646Interest income 844,778 665,463Licensing and royalty income - 10,121

37,778,186 39,978,044

LESS: EXPENDITURE

Salaries and wages 5,448,543 5,099,662Employees' Provident Fund 754,978 781,491PA insurance, hospitalisation, medical & SOCSO 179,904 147,676Auditors' remuneration 15,000 15,000Depreciation 886,086 819,618Newspapers, periodicals and books 9,243 11,616Telecommunication (Telephone, fax and internet) 65,425 90,845Office running costs (Printing, stationery, postage, etc) 192,355 189,710Bank charges 15,974 12,735Travel and transportation costs 481,346 602,231Insurance 38,231 32,855Sundry expenses 33,572 43,000Building and maintenance expenses 149,145 190,493Staff advertisements 31,072 54,124International secretariat services 938,217 856,953Balance carried forward 9,239,091 8,948,009

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STATEMENT OF INCOME AND EXPENDITUREFOR THE YEAR ENDED 30 JUNE 2016 (CONTD.)

Note 2016 2015RM RM

Balance brought forward 9,239,091 8,948,009

IT infrastructure, equipment and maintenance 618,914 663,644HR, training and capacity building expenses 207,210 224,665Awards for long service and special merit 13,113 8,968Electricity and water 92,483 87,111Fund raising expenses 6,307,104 6,052,128Communications and branding 200,559 229,404Staff welfare 193,986 5,138Rental expenses 244,109 206,672Knowledge management and library expenses 4,653 3,556Legal fees 2,703 12,336Inventories obsolescence provision - 49,377Consultancy fees 588,167 441,741

17,712,092 16,932,749

Less: Project management costs charged tovarious projects (2,519,953) (1,900,239)

Cost recoveries charged to various projects (483,419) (477,363)Operating expenditure 14,708,720 14,555,147

Surplus of income over operating expenditure 23,069,466 25,422,897Transfer to fund accounts 8 (23,069,466) (25,422,897)

- -


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STATEMENT OF RECEIPTS AND PAYMENTSFOR THE YEAR ENDED 30 JUNE 2016

2016 2015RM RM

RECEIPTS

Donations 24,913,777 23,438,770Grants

- International grants 10,867,732 14,116,621Events, promotions and sale of images and inventories 622,954 1,368,435Interest income 395,601 665,463Proceeds from disposal of property, plant and equipment 2,200 50,431Proceeds from disposal of investment - 273,955Licensing and royalty income - 10,121

36,802,264 39,923,796

LESS: PAYMENTS

Salaries and wages 5,466,984 5,124,354Employees' Provident Fund 746,941 776,828PA insurance, hospitalisation, medical & SOCSO 179,904 147,676Auditors' remuneration 15,000 15,000Newspapers, periodicals and books 9,243 11,616Telecommunication (Telephone, fax and internet) 71,445 87,618Office running costs (Printing, stationery, postage, etc) 213,084 168,598Bank charges 15,974 12,735Travel and transportation costs 473,614 607,258Insurance 29,260 32,855Sundry expenses 30,256 43,000Building and maintenance expenses 157,177 184,928Staff advertisements 55,452 29,744International secretariat services 938,217 856,953Balance carried forward 8,402,551 8,099,163

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STATEMENT OF RECEIPTS AND PAYMENTSFOR THE YEAR ENDED 30 JUNE 2016 (CONTD.)

2016 2015RM RM

Balance brought forward 8,402,551 8,099,163

IT infrastructure, equipment and maintenance 774,098 546,810HR, training and capacity building expenses 222,414 209,461Awards for long service and special merit 13,113 8,968Electricity and water 96,540 87,111Fund raising, communications and branding expenses 6,728,087 6,128,754Staff welfare 193,986 5,138Rental expenses 244,109 206,672Knowledge management and library expenses 4,653 3,556Legal fees 2,703 12,336Consultancy fees 584,418 441,741Inventories purchased 132,420 186,255Acquisition of property, plant and equipment 329,938 1,003,151Conservation and education projects expenses 20,814,517 21,818,873Placement of fixed deposits with licensed financial institutions with original maturity period of more than 3 months 20,800,000 -

59,343,547 38,757,989

NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (22,541,283) 1,165,807CASH AND CASH EQUIVALENTS AT THE

BEGINNING OF FINANCIAL YEAR 27,153,716 25,987,909CASH AND CASH EQUIVALENTS AT THE

END OF FINANCIAL YEAR 4,612,433 27,153,716

Cash and cash equivalents comprise:

Cash and bank balances 4,612,433 6,353,716Fixed deposits with licensed financial institutions with original maturity period of less than 3 months - 20,800,000

4,612,433 27,153,716


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NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2016

1. GENERAL INFORMATION

(a) by supporting studies and educational activities;

(b) by the publication of educational and scientific works thereon; and

(c)

The World Wide Fund for Nature Malaysia ("the Organisation") was incorporated under theTrustees (Incorporation) Act 1952.

The principal activity of the Organisation is to promote conservation by education andresearch as follows:

by providing opportunities for such studies and activities by means of the conservationof landscape fauna and flora, water, soils and other natural resources.

There have been no significant changes in these activities during the financial year.

The registered office of the Organisation is located at 1, Jalan PJS 5/28A, Petaling JayaCommercial Centre (PJCC) 46150 Petaling Jaya, Selangor.

The number of employees in the Organisation at the end of the financial year was 212 (2015:206).

The financial statements were authorised for issue by the Board of Trustees in accordancewith a resolution of the Trustees on 9 December 2016.

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2. SIGNIFICANT ACCOUNTING POLICIES

2.1 Basis of Preparation

The financial statements are prepared in Ringgit Malaysia (RM).

2.2 Malaysian Private Entities Reporting Standard

The financial statements of the Organisation have been prepared under the historicalcost convention and comply with the requirements of the Trust Deed dated 13 January1972 and Private Entity Reporting Standards in Malaysia.

On 14 February 2014, the Malaysian Accounting Standards Board ("MASB") issued anew MASB approved accounting framework, the Malaysian Private Entities ReportingStandard (“MPERS”).

The Organisation will be required to prepare financial statements using the MPERS inits first MPERS financial statements for the year ending 30 June 2017.

In presenting its first MPERS financial statements, the Organisation may be required torestate the comparative financial statements to amounts reflecting the application ofMPERS. The adjustments required on transition, if there are any, will be made,retrospectively, against opening retained profits. The financial performance andfinancial position as disclosed in these financial statements for the year ended 30 June2016 could be different if prepared under the MPERS.

At the date of these financial statements, the Organisation has not completed itsquantification of the financial effects of the differences between Private EntitiesReporting Standards and accounting standards under the MPERS. The Organisation iscurrently assessing the impact of adopting MPERS, and is confident that it will meet therelevant milestones to enable full compliance with MPERS in its financial statementsfor the year ending 30 June 2017.

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2. SIGNIFICANT ACCOUNTING POLICIES (CONTD.)

2.3 Summary of Significant Accounting Policies

(a) Property, Plant and Equipment

Leasehold land and building 2%Motor vehicles 20%Office equipment and computers 33.3%Renovations 15%

(b) Impairment of Assets

(c) Inventories

Inventories are stated at the lower of cost or net realisable value.

Net realisable value is the estimated selling price in the ordinary course of business.

At each balance sheet date, the Organisation reviews the carrying amounts of itsassets to determine whether there is any indication of impairment. If any suchindication exists, impairment is measured by comparing the carrying values of theassets with their recoverable amounts. Recoverable amount is the higher of netselling price and value in use, which is measured by reference to discounted futurecash flows.

An impairment loss is recognised as an expense in the statement of income andexpenditure immediately.

Cost is determined using the weighted average method and represents cost ofpurchase.

Gains or losses arising from the disposal of property, plant and equipment isdetermined as the difference between the net disposal proceeds and the carryingamount of the asset and is recognised as income or expense in the income statement.

Leasehold land and building are depreciated over the period of the respective leases.Depreciation of other property, plant and equipment is provided for on a straightline basis to write off the cost of each asset to its residual value over the estimateduseful life, at the following annual rates:

Property, plant and equipment are stated at cost less accumulated depreciation andimpairment losses. The policy for the recognition and measurement of impairmentlosses is in accordance with Note 2.3(b).

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2.3 Summary of Significant Accounting Policies (Contd.)

(d) Cash and Cash Equivalents

(e) Investments

(f) Employee Benefits

(i) Short term benefits

(ii) Defined contribution plans

(g) Currency Conversion and Translation

All exchange rate differences are taken to the statement of income and expenditure.

Transactions in foreign currencies are initially recorded in Ringgit Malaysia at ratesof exchange ruling at the dates of the transactions. At each balance sheet date,foreign currency monetary items are translated into Ringgit Malaysia at exchangerates ruling at that date.

Fixed deposits with licensed financial institutions with original maturity period ofmore than 3 months are classified as investments and not as cash and cashequivalents. These investments are carried at cost. The interest income arising fromthese investments are recognised in the statement of income and expenditure on anaccrual basis as described in Note 2.3(h)(ii).

For the purpose of the statement of receipts and payments, cash and cashequivalents include cash on hand and at banks and deposits with financialinstitutions with original maturity period of less than 3 months.

The Organisation makes contributions to the Employees Provident Fund(“EPF”). Such contributions are recognised as an expense in the statement ofincome and expenditure as incurred.

Wages, salaries, bonuses and social security contributions are recognised as anexpense in the year in which the associated services are rendered by employeesof the Organisation. Short term accumulating compensated absences such aspaid annual leave are recognised when services are rendered by employees thatincrease their entitlement to future compensated absences. Short term non-accumulating compensated absences such as sick leave are recognised whenthe absences occur.

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(g) Currency Conversion and Translation (Contd.)

2016 2015RM RM

Great Britain Pounds 5.39 5.96United States Dollars 4.03 3.79Euros 4.47 4.24Swiss Francs 4.10 4.07Australian Dollars 2.99 2.91Indonesian Rupiahs ('000) 0.31 0.28

(h) Income Recognition

(i)

(ii)

The principal exchange rates used for each respective unit of foreign currency rulingat the balance sheet date are as follows:

Income is recognised when it is probable that the economic benefits associated withthe transaction will flow to the Organisation and the amount of the income can bemeasured reliably.

Donations from individuals, corporations, foundations and grants arerecognised on the receipts basis.

The recognition of donations on the receipts basis represents a departure fromthe provisions of the accounting standard (“MASB 9 : Revenue”) as issued bythe Malaysian Accounting Standards Board. MASB 9 requires revenue of suchnature to be recognised on an accrual or systematic and rational basis.However, the Board of Trustees is of the opinion that compliance with theprovisions of MASB 9 would be misleading to users and the effect of such adeparture from the requirements of MASB 9 may be insignificant to the resultsof the Organisation.

Interest, licensing, royalty and income from events and promotions arerecognised on an accrual basis.

Sale of inventories are recognised when the Organisation has transferred to thebuyer the significant risks and rewards of ownership of the goods.

Gains and losses on the disposal of investments are calculated as thedifference between net sales proceeds and the carrying amount and arerecorded on occurrence of the sale transaction.

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(i) Expense Recognition

(j) Provisions

(k) Reserve Fund

An amount of not exceeding 10% of the surplus of income over operatingexpenditure of the General Fund is transferred to the Reserve Fund on an annualbasis, in compliance with the Licensing Agreement signed with the World WideFund International. The reserve fund is maintained for WWF International, and maybe utilised in the event of a cash call from WWF International as a contributiontowards its international conservation activities.

Provisions are recognised when the Organisation has a present obligation (legal orconstructive) as a result of a past event, it is probable that an outflow of resourcesembodying economic benefits will be required to settle the obligation and a reliableestimate can be made of the amount of the obligation.

Expenses are recognised when it is probable that the economic benefits associatedwith the transaction will flow out from the Organisation and the amount of expensecan be measured reliably.

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3. PROPERTY, PLANT AND EQUIPMENT

OfficeLeasehold equipment

land and Motor andbuilding vehicles computers Renovations Total

RM RM RM RM RM

CostAt 1 July 2014 7,330,254 3,509,613 2,582,560 3,111,425 16,533,852Additions 208,546 388,583 75,783 27,680 700,592Disposal - (169,281) (17,390) - (186,671)At 30 June 2015 / 1 July 2015 7,538,800 3,728,915 2,640,953 3,139,105 17,047,773Additions - 8,480 226,023 81,088 315,591Disposal - (12,600) - - (12,600)At 30 June 2016 7,538,800 3,724,795 2,866,976 3,220,193 17,350,764

Accumulated Depreciation

At 1 July 2014 132,099 3,240,756 2,364,023 905,564 6,642,442Charge for the year 149,733 161,696 106,171 402,018 819,618Disposal - (169,278) (17,389) - (186,667)At 30 June 2015 / 1 July 2015 281,832 3,233,174 2,452,805 1,307,582 7,275,393Charge for the year 150,776 186,803 138,313 410,194 886,086Disposal - (12,600) - - (12,600)At 30 June 2016 432,608 3,407,377 2,591,118 1,717,776 8,148,879

Net Book Value

At 30 June 2016 7,106,192 317,418 275,858 1,502,417 9,201,885

At 30 June 2015 7,256,968 495,741 188,148 1,831,523 9,772,380

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4. INVENTORIES

2016 2015RM RM

At CostBooks - 1,354Stationery 244 6,418T-shirts 163,765 193,725Souvenirs 7,989 18,735

171,998 220,232

Less: Provision for inventories obsolescence - (49,377)171,998 170,855

5. SUNDRY RECEIVABLES

2016 2015RM RM

Deposits 119,350 111,713Miscellaneous receivables 1,815,311 889,068

1,934,661 1,000,781

The Organisation has no significant concentration of credit risk that may arise fromexposures to a single debtor or to groups of debtors.

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6. FIXED DEPOSITS WITH LICENSED FINANCIAL INSTITUTIONS

2016 2015RM RM

Classified as InvestmentFixed deposits with licensed financial institutions 20,800,000 -

Classified as Cash and Cash EquivalentFixed deposits with licensed financial institutions - 20,800,000

20,800,000 20,800,000

7. SUNDRY PAYABLES

2016 2015RM RM

Miscellaneous payables 886,660 857,035Accruals 2,926,719 4,130,733

3,813,379 4,987,768

The weighted average interest rate applicable during the financial year was 3.72% per annum(2015: 3.0% per annum) and the average maturity for the placement of deposits was 180days (2015: 30 days).

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8. FUND ACCOUNTS

General Restricted International Reserve In TrustFund Fund Grants Fund Fund Total

RM RM RM RM RM RM

2016

At 1 July 2015 19,580,874 2,841,626 473,130 7,420,576 2,793,758 33,109,964Surplus of income over operating expenditure transferred from statement of income and expenditure 9,361,174 2,485,829 11,222,463 - - 23,069,466Deficit of

In Trust Fundreceipt overspending - - - - (144,787) (144,787)

Transfers (3,032,557) - 2,096,440 936,117 - -Application of

funds forconservation

and education projects (7,653,286) (2,171,896) (13,301,863) - - (23,127,045)At 30 June 2016 18,256,205 3,155,559 490,170 8,356,693 2,648,971 32,907,598

2015

At 1 July 2014 15,399,207 5,294,546 2,360,476 6,518,153 2,356,006 31,928,388Surplus of income over operating expenditure transferred from statement of income and expenditure 9,024,229 2,282,047 14,116,621 - - 25,422,897Surplus of

In Trust Fundreceipt overspending - - - - 437,752 437,752

Transfers 2,724,888 (3,627,311) - 902,423 - -Application of

funds forconservation

and education projects (7,567,450) (1,107,656) (16,003,967) - - (24,679,073)At 30 June 2015 19,580,874 2,841,626 473,130 7,420,576 2,793,758 33,109,964

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8. FUND ACCOUNTS (CONTD.)

2016 2015RM RM

Hosted organisations:TRAFFIC Southeast Asia Fund ("TSEA") 2,439,271 2,711,908Ma'Daerah Turtle Sanctuary Trust Fund ("MDTCTF") 33,563 37,612The Malaysian Conservation Alliance for Tigers Fund ("MYCAT") 172,073 39,824

Other conservation based NGOs 4,064 4,4142,648,971 2,793,758

9. TAXATION

The In Trust fund is held on behalf of the following hosted organisations and other conservation basednon-governmental organisations ("NGO").

The income of the Organisation is tax exempt in accordance with the provisions of Section 44(6) of theIncome Tax Act, 1967.

TSEA has been co-operating with WWF-Malaysia on initiatives related to the role of monitoring andcontrolling wildlife trade in support of biodiversity conservation in Southeast Asia since 1991. As ahost, WWF-Malaysia provides operational support to TSEA as the hosted party i.e. assisting TSEA inmaintaining its bank account amongst other administrative and logistical support. As per theagreement, TSEA pays WWF-Malaysia an agreed fixed sum associated with the services provided.

MDTCTF is a Trust Fund established in 2008 and held by WWF-Malaysia on behalf of theDepartment of Fisheries, WWF-Malaysia and BP Amoco as partners for conservation worksundertaken in Ma'daerah Beach, Kerteh. This Trust Fund will be managed by WWF-Malaysia i.e. tomaintain a separate bank account and to receive all funds for and behalf of the Trust and disbursing thefund upon the authority of the partners.

MYCAT is a joint programme of the Department of Wildlife and National Parks Peninsular Malaysia,Malaysian Nature Society, TSEA, Wildlife Conservation Society-Malaysia Programme and WWF-Malaysia. This is a collaborative platform for the implementation of the National Tiger Action Plan forMalaysia. As per the MoA signed on 1 January 2009, WWF-Malaysia is to provide operational supportfor MYCAT i.e. maintaining a separate bank account for the sole purpose of receiving money andmaking payments on behalf of MYCAT as well as facilitating Consultancy fees payment processing.WWF-Malaysia also maintains a separate trust account to account for monies received and paymentsmade by MYCAT. A service fee of RM100 per month is charged to MYCAT for the services providedas aforementioned.

Restricted fund comprise funds received from individuals, corporations, embassies, Foundations andaid agencies. International grants comprise all funds received from the WWF-Network. Both therestricted fund and international grants are earmarked for specific conservation projects.

General fund comprise funds that are not subject to any specific conditions imposed by the donors.This fund is used to support general operations and a variety of projects within each conservationprogram. Reserve fund comprise funds transferred from the General Fund and is maintained incompliance with the Licensing Agreement signed with the WWF-International.

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