ECF Accounting

[Jonathan Bryant]

In case clarification is needed, Jonathan's keys were not handed out by the Co-Managers.

Indeed. Apologies if I gave the wrong impression. I wrote the post in haste in order to get at a slice of Victoria Sponge as quickly as possible.

For the record, I don't feel that any one individual within the ECF is at fault for the failure to properly supervise the President. I know that you feel differently - and I can understand why you feel the way that you do - but my experience in dealing with people within the federation, face to face or online, is that without exception they all seem to be decent people trying to do their best. Collectively, however, something seems to have gone badly wrong and the fallout has adversly affected a good many people (not that you need me to tell you that).

I'm really rather sad at writing about the failures of the ECF, but failures there have been and it's best to be open about that. I'm glad that - to an extent, anyway - the federation now seem to have come to a similar view.

[Paul Cooksey]

Armed with a hot cup of tea and a calculator I've spent the last half hour trying to work out what happened with the 2011 British sponsorship. Unsuccessfully. I'm going to try to involve my 4NCL team in some Bistromathics next weekend to see if that helps.

Maybe we should be trying to work out what questions we think council ought to be asking? Probably a good idea to do it in advance, in case any relevant directors are not present, so they can give a written reply.

As I understand Mike's report (and heaven knows I'm no expert on VAT, I invite any accountants present to laugh at whatever mistakes I make):

1. The ECF received £13000 + £2600 VAT from Darwin strategic to sponsor the British. No VAT invoice was given to Darwin, denying them to opportunity reclaim VAT. The ECF Council recognises Darwin's generous sponsorship of British chess. Have the Board apologised to Darwin for this error? Has the ECF's ongoing relationship with Darwin been damaged?

It seems to me Darwin have suffered more harm than the ECF. The moral here seems to be; if the ECF gives you an invoice, triple check it

2. The ECF budget for 2012-13 shows a sponsorship figure for the 2011 British of £8333. Please explain why this is not equal to or greater than the £13000 provided by Darwin.

I ask because the xls baffles me,

3 CJ de Mooi requested payment of £12600 in sponsorship expenses from the ECF office. Can CJ confirm he received this amount in his capacity as ECF President to disperse from the ECF as sponsorship?

This is the point about CJ being registered for VAT himself. I assume he was not trying to do something clever with VAT, because he would have stiffed himself on the VAT with an inadequate invoice anyway. But if Alex thinks it material, we may as well try to clear it up.

4 The ECF Council is grateful to CJ de Mooi for his hard work publicising the 2011 British and his fundraising efforts. However there is some confusion between his personal donations and money dispersed in his role as ECF President. Can CJ clarify the amount of donations made and how they were dispersed? Does the Finance director have a consistent understanding of how ECF sponsorship was dispersed?

I'll rely on S&B to tell me what CJ has implied, as far as I know he broken any direct promise?

I would not expect CJ to give full details of amounts paid to individuals publicly, or at all where it was his own money. But assume the Finance director has visibility of the money paid on behalf of the ECF, at least now if not at the time.

5 The Chair of the governance committee recommended that any VAT receipts for sponsorship expenses be provide so VAT can be reclaimed. The ECF CEO stated that the board had accepted this recommendation. Does the board expect to recover any VAT?

I'd guess recoverable VAT will be low, unless CJ did have the good sense to settle hotel bills directly. I suppose most players are not registered for VAT, so would not have provided invoices the ECF could claim against for any money paid directly to them.

6 Does the President intend to distribute sponsorship personally in the future? If so, does he think he has the the necessary competences to do so?

I guess Alex might prefer to phrase this as "Does CJ admit he handled the sponsorship incompetently?" But seems unlikely CJ intends to resign, so it will be up to council to decide whether CJ should be re-elected, if he seeks re-election

(EDIT: changed 2012 to 2011, after Alex pointed out the error.)

[Alex McFarlane]

Paul,

I assume you mean 2011 instead of 2012 throughout.

My asking about the De Mooi VAT situation was because it was possible, for example, that he had reclaimed VAT on the hotel bills through his own company. This would be perfectly acceptable if he has spent anything like the £16k he claimed. If he has claimed the VAT then obviously the ECF cannot do so. This money would therefore be lost to future Championships. If the hotel VAT has not been reclaimed then this a terrible waste of money for which someone should be accountable.

I do agree that questions should be put in advnce to Officials who will not be there. I would hope that if there is a refusal to answer any reasonable questions then Council will view it with the severity it deserves.

I am now the Scarborough Congress delegate and will be attending the Council meeting (Lara will be going also). If anyone is looking to give proxies then please bear us in mind.

[Jonathan Bryant]

...
4 The ECF Council is grateful to CJ de Mooi for his hard work publicising the 2012 British and his fundraising efforts. However there is some confusion between his personal donations and money dispersed in his role as ECF President. Can CJ clarify the amount of donations made and how they were dispersed? Does the Finance director have a consistent understanding of how ECF sponsorship was dispersed?

I'll rely on S&B to tell me what CJ has implied, as far as I know he broken any direct promise?
....

I'm not too sure what I'm being asked here Paul. Frankly, I've no idea what CJ is saying is the situation. I do know what he says on one day will not necessarily what he'll be saying on another.


In general, I think the questions for the ECF should start with something very simple:-

1. How much money was raised for Sheffield 2011?
1a. From what sources was it obtained?
1b. How much was obtained from each source?

2. How much money was spent at Sheffield 2011?
2a. Where did it go?
2b. Who got what?


Like you, I wouldn't necessarily expect that all such figures would be placed into the public domain. It's not really important that I know what they are. It is really important that the ECF does - the ECF over and above the President, I mean.


I'd also be tempted to ask a further series of questions that might be summarised as follows:-

3. Concerns about the Presidents poor accounting skills and the funding arrangements for Sheffield were raised at the AGM last year. Why were they brushed aside?
3a. Would you like another crack at answering them more fully?
http://streathambrixtonchess.blogspot.c ... f-agm.html

[JustinHorton]

I too am puzzled by the figures given for sponsorship, and wouldn't mind some clarification for those of us whose heads start to spin when presented with rows of figures.

a. How much did Darwin provide?
b. Did anything at all come from CJ de Mooi, and if so, how much?

I'd like to echo what Jonathan says about ECF officials. I've no desire to get on their backs. They're decent people, they're trying to serve English chess and they're not trying to turn anybody over. But really, this has been a mess and has to be sorted out. This process has to be transparent and things have to be different in the future.

I have a less generous view of CJ.

[Roger de Coverly]

I too am puzzled by the figures given for sponsorship, and wouldn't mind some clarification for those of us whose heads start to spin when presented with rows of figures.

a. How much did Darwin provide?
b. Did anything at all come from CJ de Mooi, and if so, how much?

Didn't the Giddens blog reveal this

I have obtained details of an invoice dated 7 April 2011, from CJ de Mooi, addressed to the ECF office at Battle. The rubric reads blandly “British Championship Sponsorship Fund” and the invoice is in the sum of £12,600. I would emphasise that this is an invoice from CJ, to the Egregious Federation. A covering note describes the amount concerned as being the whole of the Darwin sponsorship money £15,600 (being £13,000 plus VAT), less £3,000, which CJ says “the ECF is due… from me for the British Champs”

So CJ (or was it CJ's company) paid the ECF £ 3,000 and collected the remaining £ 12,600 from the ECF. VAT complicates the issue, but if you assume all money available is spent on hotels who give you a VAT receipt then there's none payable.

To make the £ 3,000 from CJ or his Company work, CJ or his Company needs to spend all the £ 12,600 plus £ 3,000 on "conditions". You would therefore have a total spend of £ 18,600 of which £ 15,600 is spent on VAT able stuff. As a consequence, CJ, his company or the ECF, pay £2,600 in VAT and also reclaim £ 2,600 in VAT for a net VAT cost of nil.

So you could break it down as
Darwin £ 13,000
CJ/CJ's company £ 3,000
VAT reclaim £ 2,600
total spend £ 18,600

The lower amount shown in the ECF's books is, for the moment, unexplained.

Some of the accounting and reporting dispute is about whether the ECF has paid too little or too much VAT.

The more normal and established accounting practice would have been that the Congress account would have received both £ 15,600 from Darwin and £ 3,000 from CJ. From this the ECF would have a potential VAT liability but can offset this against VAT on hotel bills and other purchases.

[Alex McFarlane]

The answer to (a) is £15600 of which £2600 was listed as VAT. I know this because it passed (briefly) through the Congress account. If it is not in the final figures I will be very interested in knowing why. That is on my list of provisional questions.

The answer to (b) is nothing seems to be known (perhaps I could have omitted 'seems to be known' and still have been correct!).

One or two GMs have told me that they were offered between £300 and £500 (to a former Champion). The top 5 (I think) were offered hotel accommodation. An educated guess would be that the top 2 got between £3 and £5K in addition. My guestimate would be that the top 5 got £15-£20K amongst them including hotel with VAT. The other GMs £1500-£2000 in total.
In simple terms, it is feasible that the Darwin money and the Staunton money covered the sponsorship provided.

The VAT on the hotel bill would have been circa £700-£800.

An earlier post reminds me that De Mooi claimed that he took no money from the Short simuls. This may indeed be true, but until he confirms that he was not paid a fee as GM Short's manager this statement will continue to be questioned by some. Certainly the accounts produced on this forum do nothing to clarify the position. For clarity, I have no problem with him getting a management fee but if he did it is being economic with the truth to state he got nothing.

The invoice from De Mooi referred to by Steve Giddins contained a VAT number but nothing noted as VAT. This is what lead me to wonder if he has reclaimed the VAT through his company.

[Jonathan Bryant]

The answer to (a) is £15600 of which £2600 was listed as VAT ... If it is not in the final figures I will be very interested in knowing why.

This post of 12th July
http://www.ecforum.org.uk/viewtopic.php ... 135#p64633

is worth a re-visit. In addition to the totals given, there's the £1500 (or £500 or £0 or "substantial" sum) that, depending on what day it was, de Mooi said was raised by the first Nigel Short Simul tour. That lot comes to up to £40,000 if my maths is correct.

The discrepancy between that post and your estimates of outgoings is - needless to say - why you have to know exactly what was spent and where.

An earlier post reminds me that De Mooi claimed that he took no money from the Short simuls.

Strictly speaking, de Mooi only said he wasn't going to take a fee from the first tour. Whether he did or not we can't be sure - since despite repeated promises to do so he didn't provide anything that resemble actual accounts - but in any event he didn't make any such promises for the second tour.


Edit:
"I will not take a single penny from the whole tour" was what he said about the first tour.
http://www.ecforum.org.uk/viewtopic.php ... =15#p48224

That doesn't seem to leave any wriggle room. Mind you, he immediately followed that with, "and as always, full accounts will be available for perusal upon completion" which turned out to be untrue.