CWU Consolidated Accounts 2019
Further to LTB 521/20 dated 2nd November which invited questions to the 2019 CWU Accounts, at the closing time of 12:00 hours on Monday 16th November following questions had been submitted by the Harrow and District Branch.
Q1) It is noted that there has been a reduction of legal & medical costs from 2018 to 2019, can you provide a breakdown of these costs?
These are contained in the table below:CodeHeading 20192018Variance5000Bandit Attack PMTS1,1894177725001Self-Insured Conditional Fees-20,454-25,9125,4585002Criminal Defence0432-4325003Disbursement Refunds-16,004-50,56234,5585004Disbursement Costs69,40670,982-1,5765005Referral Fees Income-1,920-4,5002,5805006Commission Income-69,5680-69,5685008Medical Fees1,3701,0782925009Medical Tribunals3301491815011Indemnity Insurance47,02741,7505,2775012Solicitors Fees53,02931,75221,2775014Department Expenses4,5696,906-2,3375015Defendants Costs40,92284,000-43,0785017BT Hearing Loss Referral fees0-3603605018BT Hearing Loss Conditional Fees-995-99505019BT Hearing Loss Disbursements0950-950TOTAL108,901156,087-47,186
Q2) Has there been any income generated by the Legal & Medical Services in 2019 if so where is this recorded in the accounts?
Yes, there has been income generated from legal and medical services during 2019. This income has been included as part of the total expenses contained in the Accounts on page 24, note H Central Services to Members, Legal & Medical Services.
The total income received during 2019 was £108,941 and in 2018 it totalled £82,329, resulting in a £26,612 year on year increase. The breakdown of this income is the sum of the following headings detailed in the above table; 5001, 5003, 5005, 5006, 5017, and 5018.
Q3) It is noted that there is an explanation of Unionline on page 1 of the report. On page 24 under section H there is a considerable difference between 2018 and 2019 Unionline costs. Can you provide a full breakdown of the Unionline costs for 2019 and an explanation for the difference in costs between 2018 and 2019?
Breakdown of Unionline Costs:Heading 20192018VarianceGeneral Department Expenses (directly related to ownership of Unionline)53,65621,89731,759Unionline Recharge2,584,388-1,022,3953,606,783TOTAL2,638,044-1,000,4983,638,542
The explanation provided on page 1 of the “Report of the Senior Deputy General Secretary” is, as the question sets out, the answer to the point raised. That is, the impact on this particular set of accounts only is that, whilst those discussions continue at national level with the GMB, we have not yet finalised the issue of when we will take cash out of the business in time for that to be recorded in these accounts. Whilst we are of the opinion that the Union will receive repayment of the monies owed, we currently cannot do so with the certainty the auditors need to rely on (i.e. the timescale it will take us to recover the debt in full). In light of this, we can no longer carry this debt forward. In accounting terms, this is known as making a provision against an uncertain debt.
In summary, in not being able to specify exactly when amounts owed by Unionline will be repaid and therefore providing for the amounts outstanding we now show an operating loss of £1.04m and a total comprehensive expense of £4.75m. If we could have specified exactly when the amounts would be repaid, no provision would have been necessary and we would have been reporting an operating income of £2.89m and a total comprehensive expense of £816k. We want to be absolutely clear in repeating our previous messaging on this matter, this does not mean we have paid out this money in cash. The total and only cash amount loaned to Unionline remains as it has for some years now at £273,250.
This issue solely relates to the amounts we have recharged Unionline in recent years. Accordingly, as can be seen, particularly under HQ expenses page 21, the inclusion of this provision against the monies owed to us is the primary reason for the change from a surplus in 2018 to a deficit in 2019. This does not imply that we have written any debts off permanently, but more so that we have agreed to be very cautious in our current assessment as to the recoverability of amounts owed in the short term. Future recovery of any of these amounts owed will positively impact on our accounts in the future.
In short, the year on year difference is due to the Union not making a recharge to Unionline for the 2019 period. As well and as explained above, in 2019 the Union included a provision for bad debts against prior year Unionline recharge income. So in essence the 2018 accounts record income for Unionline in the form of a recharge and 2019 does not include any income, but instead writes off income from prior year recharges, creating the considerable difference year on year.
Senior Deputy General Secretary