Where the money is going

Probably you were also wondering where all the money collected mainly as fee/tax is going. Many people are guessing, but very few know the numbers. My feeling is that even the ones who know the numbers have only vague ideas about the trends. So I am happy to present here probably the only historic overview of IOF expense evolution from 2000 to present.

The short summary:

  • IOF expenses have grown unrelentlessly since 2005, from around €200,000 to a budgeted €900,000 in 2018
  • Staff cost is the dominant expense that also provided the backbone for total growth, a superb confirmation of Parkinson’s Law
  • Spend on IT systems has exploded from €0 in 2013 to a planned €110,000 in 2018 – or close to 4 times what he IOF spends on quality assurance for all events in a typical year
  • The Olympic project is a less visible sink for freely spendable money, but its average annual cost is comparable to all spend on IOF event quality
  • Some growth is related to taking on flow through expenses (TV, AD), that were part of the sport, but now they are more visible, which is a good thing.

IOF Expenses 2000-2018 v2

I have to admit, that it was not easy to put together the data, despite IOF being committed to the highest standards of transparency. It is bad form to complain about the difficulty of an analysis, but I have to give this caveat: post-2006 the data is mainly estimate, directionally correct, but may deviate slightly in detail. Audited reports have a different cut than relevant budget. Post-2012 60% of the expenses were on one single line “Other expenses” in the audited reports, so I had to rely on adjusted budget numbers. Where some details were given, like 2013 and 2015, they did not appear to match the totals in the audited reports, and so on.

The 2017 budget numbers were adjusted in January according to the Council meeting minutes of 2017, but not many specific details known, other than lower cost for staff (one part timer has left, but a part timer may have become full timer), and an extra €20,000 authorised for the World Games (Olympic project).

Despite all the uncertainty, the most reliable number is the ever growing total staff cost, because that was the only major expense reported on a separate line in all audited reports used. Luckily, that is also the single largest expenditure that worths attention. The other ones that exploded over the past couple years are IT systems, Olympic project, TV and Anti-Doping expenses.

Let’s have a look at these in a bit more detail.

Continue reading “Where the money is going”

Presidents’ Conference – will there be questions?

I am just getting curious, if there will be any questions on the Presidents’ Conference in Tartu regarding the critical financial situation of the Federation.

The IOF finances have deteriorated to a point where normal business variation may result in bankruptcy, not to talk about the impact of an unexpected event.

The presidents of IOF member organisations will meet the President, the Council and the Secretary General on Wednesday, 5 July, during WOC 2017. The Presidents’ Conference is an advisory body to the IOF, typically meets every second year in between General Assemblies. Yet, all key participants are the same as on a General Assembly, hence it gives the opportunity to discuss all important IOF questions with the members.

The agenda for this years Presidents’ Conference was sent on 24 April

• Strategic Directions 2018-2024
• Strategic Planning Calendar for IOF Events
• IOF Sustainability Policy
• Update on the IOFs Anti-doping work
• Reports on on-going activities

No mention of financial questions, whatsoever, though it was clear in January that IOF finances took a nosedive after years of steady decline (see here). One may – mistakenly – believe that there are two topics where overall finances may be addressed, but that is not the case.

The strategic directions document is light on numbers (contains only dates and page numbers), despite the sad fact that finances often present hard constraints to strategic dreams.

The IOF Sustainability Policy is all about environmental impact, while the sustainability of the IOF as a financially viable organisation is taken for granted.

(Interesting to note that the Consultation Paper on IOF Sustainability includes fascinating ideas like using Eventor to make participants of orienteering events pay an environment fee dependent on where the participant travel from – but that deserves a separate post).

 

Budget and results 2016-17 v2

Yet, the Council knew already in January that the 2016 and 2017 combined financial results were expected to be €160,000 worse than the budgets the Council presented to the General Assembly 5 months before. (see 12.2 and 12.5 in Council Minutes #183).

Compare this with the IOF reserves of €114,630 at the end of 2015, and an estimated €77,000 at the end of 2016. The uncertainty in the budget forecast shown above is comparable to the reserves left after the continued decline since 2008. Another downward revision comparable to what happened in 2016 or expected for 2017 would mean that the IOF looses all its reserves. That is called bankruptcy.

Continue reading “Presidents’ Conference – will there be questions?”

Live Orienteering in action

If you ever wondered why IOF online ticket sales were lagging far behind expectations, here is a series of screenshots from today’s Sprint Final live session on Live Orienteering.

Price: €6 for one day only, and €20 for 5 days, but you learn about it only when you try to pay.

Apparently the chat box was removed. I guess due to unfiltered comments about the service. You may read on Attackpoint some honest reaction of enthusiastic orienteers who were willing to pay to watch the action real time.

This happened 5 weeks after Live Orienteering’s flop on the first round of the FootO World Cup. Some comments are here on facebook where people were demanding their money back.

Liveorienteering 4

Liveorienteering 1Liveorienteering 3Liveorienteering 2