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EUROPEAN RENAL ASSOCIATION - EUROPEAN DIALYSIS AND TRANSPLANT ASSOCIATION

REPORT AND FINANCIAL STATEMENTS

YEAR ENDED 31 DECEMBER 2001

Macnair Mason Chartered Accountants

EUROPEAN RENAL ASSOCIATION - EUROPEAN DIALYSIS AND TRANSPLANT ASSOCIATION REPORT AND FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2001 Contents Page Report of the Council of Management 3 - 9 Report of the auditors 10 Statement of financial activities 11 Balance sheet 12 Statement of accounting policies 13 - 15 Notes to the financial statements 16 - 24


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REPORT AND FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2001 Council of Management a) Five ex-officio members, namely Prof. A M Davison (President) Dr. F Carrera (Secretary-Treasurer) Prof. T B Drueke (Editor-in-Chief) Dr. D J Briggs (Chairman of the Registry) Dr. L Piera (Chief Controller) b) Eight ordinary members, namely (* In office 31.12.01) F Locatelli (until 26.06.01) J M Morales (until 26.06.01) A J Wiecek * W Hoerl * A L M De Francisco * R Coppo * (from 26.06.01) C Zoccali * J Floege * (from 26.06.01) J Nagy * R Vanholder * Auditors Macnair Mason Chartered Accountants John Stow House 18 Bevis Marks London EC3A 7ED United Kingdom Registered charity number 1060134 Main Bankers & Investment advisors Symphonia SIM Spa Corso Matteotti 7-20121 Milano Italy Other Investment advisors Union Bank of Switzerland 6830 Chiasso 1 Mercurio Switzerland Azimut SGR SpA Societe di Gestione del Risparmio 20131 Milano Italy


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REPORT AND FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2001 Principal Office Department of Nephrology & Dialysis Hospital SAMS Rua Cidade de Gabela 1 1800 Lisbon Portugal Solicitors Linklaters & Paine Barrington House 59 – 67 Gresham Street London EC2V 7JA United Kingdom


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REPORT OF THE COUNCIL OF MANAGEMENT The members of the Council have pleasure in presenting their report, together with the audited financial statements for the year ended 31 December 2001. Legal and administrative information European Renal Association is an unincorporated association and was registered with the Charity Commissioners on the 14 January 1997 under number 1060134. The governing instrument is the Charity’s Constitution, which was adopted on 14 January 1997. The administration of the Association as determined by the Constitution is carried out by: a) The General Assembly

b) The Council

c) The President of the Association

d) The Secretary-Treasurer

e) Such other Council Members as set out in the Constitution Ordinary members of the Council are elected by the General Assembly. Ex-officio members of the Council are elected by nomination one year in advance and must be supported by two other full members. Both the candidates and the supporters must be full members and must have at least five years seniority in the Association. The President of the Association is appointed for a period of one year and may be re-elected for a further one year period, not exceeding three years. The Secretary-Treasurer is appointed for a period of three years and may be re-elected for a period not exceeding three years. The Chief Controller is appointed for three years and may be re-elected for a further period not exceeding three years. The Association is represented by its president, or the Secretary-Treasurer, or by any two members of the Council jointly, or by any other persons that the Council shall appoint. Members of the Association are honorary members, senior members, full members, associate members and congress members. The general assembly is the supreme authority of the Association. The meetings of the general assembly can be ordinary or extraordinary. The Council is the executive body of the Association and in furtherance of the objects of the Association. The Council may execute powers to:

a) Raise funds

b) Buy, take on, lease or exchange any property

c) Subject to consent, sell, lease or dispose of all or any part of the property of the Association

d) Subject to consent, borrow and charge all or any part of the property of the Association


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REPORT OF THE COUNCIL OF MANAGEMENT Legal and administrative information continued

e) Employ and dismiss staff

f) Co-operate with other charities

g) Support any charitable trusts, etc

h) Incorporate a subsidiary company

i) Do all such other lawful things to achieve objectives Members of the Council of Management and professional advisors are as detailed on page 1 and 2 of the financial statements. The activities of the Association are transacted in various foreign currencies, the primary currency this year being Euros, (2000: Swiss Francs). The financial statements of the Association are therefore translated into Euros where appropriate, as detailed in the accounting policies set out on page 14 of the financial statements. Narrative information Aims and organisation The main purpose of the Association is the advancement of medical knowledge by promoting scientific and clinical advances in the field of nephrology, dialysis, renal transplantation, hypertension and related subjects. The Association achieves its objectives by publishing the NDT journal, holding annual congresses, producing epidemiological data for research, organising educational courses and co-operating with other scientific organisations. The administration of the Association is undertaken by the principal office in Portugal, where the Secretary-Treasurer resides. This office has the role of overall co-ordination of the account and administration of the policies to be adopted and decisions made. The entire organisation of annual congresses are undertaken by the Association itself through its congress office, based in Italy. The ERA-EDTA also set up a subsidiary company registered in the UK under the name of ERA-Eurocongress Limited. It gives the Charity ERA-EDTA the legal authority to undertake commercial activities, such as organising industrial exhibitions. The Editorial Office is responsible for the journal of the Association (Nephrology, Dialysis and Transplant), and is undertaken from the office in France where the Editor-in-Chief resides. The Registry resides in Amsterdam. Its main task is the collection of data from the ERA-EDTA member countries and the production of reliable epidemiological data on End Stage Renal Failure and its different modalities of treatment. Elections took place at the Council meeting in Krakow, Poland on 3 November 2001 as the terms of the current President, Secretary-Treasurer, Chief Controller and Editor-in-Chief as detailed on page 1 of the financial statements are due to expire in 2002. It was decided at the meeting that the following would be ratified at the forthcoming General Assembly and would take their posts from 16 July 2002 as follows: President – Prof. Franceso Locatelli Secretary-Treasurer – Prof. Jorge Cannata Andia Chief Controller – Dr L Piera (second term) Editor-in-Chief – Prof. T B Drueke (second term)


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REPORT OF THE COUNCIL OF MANAGEMENT Review of activities and achievements in 2001 The NDT Journal In 2001 personal and institutional subscriptions, re-prints, supplements and advertising have generated a positive balance. The balance between production costs and income has been positive for the publisher (Oxford University Press) for several years, however it was not so for the Association, because the ERA-EDTA had to pay subscriptions for its Full Members and Associate Members. In 2001, as well as in 2000, the balance was so positive it covered such costs and generated a surplus for the Association. The number of submissions for supplements was 18 and 7 were published. The numbers are slightly lower than in 2000 (20 submitted and 8 published) but still very satisfactory. In 2001 the Editorial Office has progressively switched from paper submission of articles and letters to electronic submission. This has taken considerable efforts and has increased the workload of the Editorial Office staff for some time, however, the new system is expected to be more efficient and to allow a shorter interval between the time of submission and the time of publication. Educational Activities The Association has continued in its policy of educational courses, arranging the following meetings: January 23-26, 2001, Prague (Czech Republic) – Post-graduate training course; March 26-30, La Havana (Cuba) – Seminar in nephrology; May 5, 2001, Brdo (Slovenia) – International one-day nephrology update. Due to the success of these initiatives, the Association has decided to increase their number and to arrange them into a co-ordinated scheme. As far as post-graduate training is concerned a continuing medical education committee has been established under the chairmanship of Rosanna Coppo. The Union of European Medical Specialists (UEMS) has recognised our annual congresses for the award of continuing medical education credits. A further function of the ERA CME committee is to examine requests frequently received from national societies and other specific meetings relating to ERA patronage. Previously this has been given on a somewhat haphazard basis and for the future the Council of the Association is keen that all meetings which are given ERA patronage meet a minimum requirement with respect to scientific value. The Annual Congress (Vienna) Participation, with 4,181 registered delegates, was lower than last year, but still the third highest in the history of the Association. There was no significant reduction of participants from specific countries (except France, whom in 2000 was the host country). A possible cause for this decrease may be identified in the fact that a congress on Peritoneal Dialysis was held in Canada almost on the same dates as the ERA-EDTA congress. Although that meeting does not attract very large numbers (a few hundred) it is reasonable to presume that many specialists in peritoneal dialysis who attended the congress in Canada would also have attended our congress, had there not been a clash of dates. Several delegates considered the sessions of the Technical Forum to be too many, and to be given a too prominent placement in the congress timetable, (mid morning). It has been decided to limit the number of companies to arrange only one session each, and to schedule them only at the time of lunch-breaks, or in the few hours before the Opening Ceremony, on the first day. Membership At the end of 2001, the total number of members was 5,294. 461 new members were accepted and 362 left the Association, showing a net increase of 99 for the year. The Association therefore continues to grow, although this increase has slowed down somewhat. There has generally been greater interest from Eastern and Central European countries. The introduction of the ‘On-line membership’, i.e. reduced membership fees for those members who do not receive the journal, but can access the internet version, was favourably met, but has not caused any revolution: the members who have chosen this option were 289 at the end of the year. Registry The activity of the new Registry has provided significant results for studies in epidemiology. The Registry currently receives data from national or regional registries. Such results have been presented during a session of the annual congress in Vienna, and there are plans to publish an annual report to be made available on the internet. The present contract with AMC (of the University of Amsterdam) is due to expire in June 2002, and a new one has been devised for the duration of four years starting June 1, 2001.


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REPORT OF THE COUNCIL OF MANAGEMENT Review of activities and achievements in 2001 continued Best Practice Guidelines Two further parts of the European Best Practice Guidelines have progressed in 2001 and will be published in 2002: the second part of the Transplantation Guidelines and the first part of the Haemodialysis Guidelines. These documents are expected to be of significant value in improving the management of patients by dialysis and transplantation. The guidelines relating to Peritoneal Dialysis are in an advanced state of preparation and it is hoped that these will be available for publication early in 2003. It will now be necessary to put in place a mechanism whereby the guidelines can be reviewed on a regular basis to ensure that they continue to provide up-to-date recommendations. Internal controls and mitigation of major risks The Council of management has identified a number of risks and as a consequence has introduced the following Risk Management Policy: Annual Congress a) Reduction in Attendance

The financial viability of a congress is dependent on the number of registered delegates. Circumstances out of the control of the Association may arise which significantly reduces the number of delegates attending the annual congress. To restrict the financial loss which would ensue, Euro Congress has in place a contract with congress venues and associated suppliers which allows for a reduction in the rental space, temporary staff, and catering, without incurring penalty.

b) Congress Cancellation

Acts of terrorism or political instability may result in the cancellation of a congress. To limit the consequences of this a 'force majeur clause' (which includes acts of terrorism) is included in contracts with all suppliers to avoid the payment of penalties in case there is a need to cancel the annual congress for such reasons. As payments are made over a long period of time and as political instability is difficult to predict appropriate insurance coverage has been obtained.

c) Personal Safety

Contracts with congress centres and commercial exhibitors who construct exhibition stands or sub-contract such work to be undertaken must provide evidence of adequate insurance cover for any personal injury which may arise as a result of accidents occurring to any delegates, speakers, or temporary staff.

Employees a) Staff employed by the Association are issued with appropriate contracts which meet all legal requirements of the

countries where such staff are employed. b) Obligatory insurance is included in contracts in all the countries where ERA staff are employed. Additional

insurance is available for employees who are required to travel as a consequence of their employment. Financial Risks The capital assets of the Association are reviewed regularly to ensure that investments are held in appropriate funds. Investment Managers are instructed not to invest in high risk funds and additionally are required to regularly review the investment portfolio and provide a written report to the Council of the Association.


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REPORT OF THE COUNCIL OF MANAGEMENT Internal controls and mitigation of major risks continued Risks to Council Members a) Council Members as Trustees of the Association are responsible for the proper governance of the Association.

Indemnity insurance is provided to limit each Council Member’s financial liability. b) Council Members undertake their duties on a voluntary basis and are thus expected to provide personal insurance

for travel risk. Records of the Association a) Electronic Files

Files held electronically are copied on a regular basis, such that information is held in at least two separate centres. b) Paper Files

Important paper files are held in fireproof safes. c) Confidentiality

Electronic data held by the Association is not disclosed to third parties without the permission of the Member providing the data.

d) Virus Protection

All computers used by the Association are checked at intervals with the most up to date anti-virus software. Subsidiary Trading Company The Association has a UK trading subsidiary, ERA Eurocongress Limited, a UK registered company incorporated on 3 September 1997. The company’s primary activity is to sell exhibition and advertising space in conjunction with Congresses arranged by the Association. The trading income of ERA Eurocongress Limited from its Congress exhibitors increased by 24% to £839,032 this year. All the trading profits of the company have been gifted to the Association as detailed on page 11 of the financial statements. Investment powers, policy and performance The day to day management of the Association's investment funds are delegated to professional Investment Managers. The Council of Management's Investment policy is to obtain secure long term growth whilst at the same time providing an acceptable rate of return to further the Association's educational and scientific activities. The continuing downturn in the securities market throughout this financial year, and particularly the Association's investment in Conexant, Ericsson, Enron, Marconi, Nasdaq-100 have incurred losses and continued to depress overall performance. The Council of Management review the Investment Managers performance at regular intervals to ensure that the overall investment policy is maintained. Reserves Reserve Policy The Council of Management’s policy on reserves is to accumulate surplus funds sufficient to sustain all the activities of the Association in the event of some natural or political catastrophe resulting in the cancellation of the annual congress and therefore the loss of the major source of income for the Association.


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REPORT OF THE COUNCIL OF MANAGEMENT Unrestricted Reserves As at 31 December 2001 the Association held accumulated unrestricted funds of Euro 4,268,175.53, (2000: Euro 2,774,949.28). The accumulated unrestricted funds are to be held and used for funding future congresses and activities in furtherance of the Association’s objectives. Due to possible fluctuations in income and expenses, particularly in respect of Congress income, the Council of Management consider that it is necessary to build up Reserves to cover contingencies as per the following. Reserve Fund During 2001 the Association continued to make substantial investments with Symphonia, which is hereby called a Reserve Fund. The purpose of the Reserve Fund is to provide the Association with sufficient economic means to deal with extraordinary expenses or unforeseen adverse events that may threaten the financial viability of the Association, or impair the efficient conduct of its duties and functions. The Association shall deposit into the Reserve Fund any surplus derived from the efficient conduct of its duties and functions. Initially the Reserve Fund shall not exceed the amount corresponding to 2.5 million Euro, the ‘Reserve Fund Maximum Amount’. The Ordinary General Assembly, upon a proposal by the Council, by simple resolution may increase or diminish the Reserve Fund Maximum Amount, to satisfy the needs for which the Reserve Fund was established. The Reserve Fund is to be managed by the Secretary-Treasurer, within the guidelines set by the Council. However, at least 80% of the Reserve Fund assets shall be invested in bonds issued by top rated issuers. Other than in the case of extraordinary expenses or unforeseen adverse events, any proceeds derived from the Reserve Fund may be utilised solely for the following purposes: a) replenishing the Reserve Fund up to the Reserve Fund Maximum Amount; b) financing grants, studies, researches, publications, congresses and other similar activities within the sphere of the

interest of the Association; The utilisation of the Reserve Fund for any extraordinary expenses or unforeseen adverse events shall be determined by the Council following a resolution passed at a meeting by a majority of at least two thirds of all its members present. replenishing the Reserve Fund as per item a) above shall be part of the current management of the Reserve Fund entrusted to the Secretary-Treasurer, the financing of Association activities envisaged under item b) above shall be resolved by an ordinary resolution of the Council. The reserve fund as at 31 December 2001 was Euro 951,586.02, (2000: Euro 1,126,845). Impact of the Euro The Association actively operates in the Euro and maintains a Euro bank account and a Euro investment account. The Council of Management have considered the impact of the introduction of the Euro in early 2002 on the Association and they do not anticipate that any problems will arise or impact on the Association’s activities. Tangible fixed assets and Investments Movements in fixed assets and investments are set out in notes 9 and 10 to the financial statements. Acquisitions of fixed assets during the year were made in accordance with the adopted constitution. All fixed assets are held for charity use. Results for the year The net movement in funds as shown by the Statement of Financial Activities on page 11 is an increase of Euro 1,493,226.25, (2000: an increase of Euro 979,182.47).


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REPORT OF THE COUNCIL OF MANAGEMENT Responsibilities of the Council of Management It is the members of the Council of Management’s responsibility to keep proper accounting records which disclose with reasonable accuracy at any time the financial position of the Association. It is the members of the Council of Management’s responsibility to safeguard the assets of the Association and take reasonable steps to prevent and detect fraud and other irregularities. It is the members of the Council of Management’s responsibility to prepare statements of accounts for each financial year. Council of Management The members of the Council of Management who have held office during the year were as follows:- a) Five ex-officio members, namely:

Prof. A M Davison - President Dr. F Carrera - Secretary-Treasurer Prof. T B Drueke – Editor-in-Chief Dr. D J Briggs – Chairman of the Registry Dr. L Piera – Chief Controller

b) Eight ordinary members, namely: (* In office 31.12.01)

F Locatelli (until 26.06.01) J M Morales (until 26.06.01) A J Wiecek * W Hoerl * A L M De Francisco * R Coppo * (from 26.06.01) C Zoccali * J Floege * (from 26.06.01) J Nagy * R Vanholder * Auditors A resolution proposing the reappointment of Macnair Mason as auditors to the charity will be put to the next Council meeting. By order of the Board ………………………………… (President) Date: …………………………. ………………………………… (Secretary-Treasurer) Date: …………………………. ………………………………… (Chief Controller) Date: ………………………….


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REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS We have audited the financial statements on pages 11 to 24, which have been prepared on the basis of the accounting policies set out on pages 13 to 15. Respective responsibilities of the members of the Council of Management and Auditors As described on page 9, the members of the Council of Management are responsible for the preparation of the financial statements. It is our responsibility to form an independent opinion, based on our audit, on those statements and to report our opinion to you. We have been appointed as auditors under Section 43 of the Charities Act 1993 and report in accordance with regulations made under Section 44 of that Act and United Kingdom Accounting Standards. We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in accordance with the Charities Act 1993. We also report to you if, in our opinion, the Report of the members of the Council of Management is not consistent with the financial statements, if the Association has not kept proper accounting records, if we have not received all the information and explanations we require for our audit. We read the Report of the Council of Management and consider the implications for our report if we become aware of any apparent misstatements within it. Basis of Audit Opinion We conducted our audit in accordance with United Kingdom Auditing Standards issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the Executive Committee in the preparation of financial statements and of whether the accounting policies are appropriate to the Association’s circumstances, consistently applied and adequately disclosed. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material mis-statement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. Opinion In our opinion the financial statements give a true and fair view of the Association’s state of affairs as at 31 December 2001 and of the incoming resources and application of resources for the year then ended and have been properly prepared in accordance with the Charities Act 1993. John Stow House 18 Bevis Marks London EC3A 7ED Registered Auditors Chartered Accountants


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STATEMENT OF FINANCIAL ACTIVITIES (including Income and Expenditure Account) YEAR ENDED 31 DECEMBER 2001

Notes

2001 Total

unrestricted funds Euro

2000 Total

unrestricted funds Euro

Incoming resources Voluntary Donations from trading subsidiary 1,200,000.00 774,659.93 Charitable activities Gross congress proceeds receivable 1 1,570,882.80 1,530,101.87 Membership fees 475,080.64 459,306.56 Grants received - 23,269.49 Sponsorship - 5,163.54 Journal on Nephrology, Dialysis & Transplantation 233,520.31 282,938.88 Investment income Income from investments 10c 13,217.35 3,906.15 Interest from bank accounts 2,238.34 2,032.64 Mark up on Symphonia gains - 26,294.78 Other incoming resources Currency exchange gains 23,489.95 33,130.51 Total Incoming Resources 3,518,429.39 3,140,804.35 Resources expended Costs of generating funds Promotional activities 19,515.45 7,725.50 Investment management fees 21,970.42 28,210.58 41,485.87 35,936.08 Charitable expenditure Direct 2 1,476,372.35 1,440,442.61 Management and administration 3 249,735.86 293,348.36 Total charitable expenditure 1,726,108.21 1,733,790.97 Total Resources expended 1,767,594.08 1,769,727.05 Net incoming resources for the year - Net income for the year

1,750,835.31

1,371,077.30

Gains and losses on: Investment asset disposals 10d (9,123.40) (75,369.46) Investment assets revaluation 10d (248,485.66) (316,525.37) (257,609.06) (391,894.83) Net movement in funds for the year 1,493,226.25 0 979,182.47 Currency gains on translation into Euros - 114,005.80 Balance brought forward at 1 January 2001 2,774,949.28 1,681,761.01 Balance carried forward at 31 December 2001 4,268,175.53 2,774,949.28 All operations are classed as continuing The notes on pages 13 to 24 form part of these accounts.


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BALANCE SHEET AS AT 31 DECEMBER 2001 Notes 2001 2000 Euro Euro Euro Euro

Fixed assets Tangible fixed assets 9 7,274.85 2,465.66 Investments 10 1,843,955.29 1,822,068.88 1,851,230.14 1,824,534.54 Current assets Debtors 11 1,817,037.87 589,035.63 Cash at bank and in hand 12 1,023,600.07 873,751.66 2,840,637.94 1,462,787.29 Creditors: Amounts falling due within one year

13

423,692.55

512,372.55

Net current assets 2,416,945.39 950,414.74 Total assets less liabilities 4,268,175.53 2,774,949.28 Accumulated funds Unrestricted 14 4,268,175.53 2,774,949.28 The financial statements were approved by the Council and signed on their behalf by …………………………………………. Date:

…………………………………………. Date: …………………………………………. Date: The notes on pages 13 to 24 form part of these accounts.


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ACCOUNTING POLICIES YEAR ENDED 31 DECEMBER 2001 These financial statements have been prepared in accordance with The Charities (Accounts and Reports) Regulations 2000 the current Statement of Recommended Practice: ‘Accounting and Reporting by Charities’ (the Charities SORP 2000) and applicable accounting standards. They are drawn up under the historical cost accounting basis except that investments held as fixed assets are carried at market value. Incoming resources All income is accounted for on an accruals basis. (a) Membership fees Membership fees are taken as income in the year to which they relate. (b) Congress income and expenditure Congress income and expenditure is taken into account in the year that the congress was held. (c) Interest from bank accounts Interest received is recognised in the year which it has been received. (d) Donations and grants received

Donations and grants received from third party organisations and the Association’s subsidiary undertaking are recognised in the year in which they are receivable.

(e) Journal on Nephrology, Dialysis & Transplantation

The Association utilises the services of Oxford University Press to print and distribute their Journal on Nephrology, Dialysis and Transplantation. Each year Oxford University Press prepare audited financial statements of their activities and the results and the net result is either remitted to the Association or invoiced to the Association. This year for the second year running, the Journal has made a profit. The net financial effect of these activities are disclosed as an incoming resource of the Association and is recognised in the year that the Journal relates.

Expenditure All expenses are accounted for on an accruals basis. Costs of generating funds include advertising expenditure and investment management charges incurred in the year. Direct charitable expenditure primarily includes congress expenses incurred, editorial office costs and expenditure to support its branch, the Registry. Staff costs have been apportioned between direct and administration costs on the basis 85% to 15%, which is a reflection of the work undertaken. Grants payable included in charitable expenditure are budgeted for by the Association in advance each year. The grants made are to assist young doctors with accepted abstracts to attend the Congress to make the presentations. A maximum of 60 grants are assigned according to the rating of abstracts. The condition of payment is that they must attend the Congress. This year 47 grants were awarded as disclosed in note 2 of the financial statements. Management and administration expenses include staff costs apportioned, and general overheads incurred in the running of the Association. Depreciation is allocated on the basis of the use of the assets concerned.


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ACCOUNTING POLICIES (CONTINUED) YEAR ENDED 31 DECEMBER 2001 Fixed assets Individual fixed assts costing more than 500 Euros are capitalised at cost. Depreciation is calculated at a rate that will write off the cost of the assets evenly over their expected useful lives as follows: Software - 20% on cost per annum. Office equipment - 25% on cost per annum Electronic equipment – 33 1/3% on cost per annum Investments (a) UBS ECU Investments Investments are included in the Balance Sheet at market value at the end of the financial year, as supplied by the Investment Managers, UBS, in Switzerland. Realised and unrealised gains and losses are credited or debited to the statement of financial activities in the year in which they arise. (b) Symphonia Investments Investments are included in the Balance Sheet at market value at the end of the financial year, as supplied by the Investment Managers, Symphonia SIM in Italy. Realised and unrealised gains and losses are credited or debited to the statement of financial activities in the year in which they arise. (c) Azimut Investments Investments are included in the Balance Sheet at market value at the end of the financial year, as supplied by the Investment Managers, Azimut SGR SpA. Realised and unrealised gains and losses are credited or debited to the statement of financial activities in the year in which they arise. Foreign currencies Transactions in foreign currencies are translated at an average rate calculated for the year. Monetary assets and liabilities in foreign currencies are translated at the rates of exchange ruling at the Balance Sheet date. Where exchange differences result from the translation of foreign currency borrowings raised to acquire foreign assets they are taken to reserves and offset against the differences arising from the translation of those assets. All other exchange differences are dealt with through the Statement of Financial Activities. For the year ended 31 December 2001 the Association have decided to disclose the financial statement in Euros as opposed to Swiss Francs. The comparatives have been translated and there is a gain on translation of Euros 114,005.80, which has been dealt with through the Statement of Financial Activities.


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ACCOUNTING POLICIES (CONTINUED) YEAR ENDED 31 DECEMBER 2001 Taxation The Association is registered as a charity under the Charities Act 1993 and it is not liable to UK tax on its income and chargeable, gains as these fall due within the various exemptions available to registered charities. ERA-EDTA Registry As detailed in the Council of Management Report on page 5, and note 6 to the financial statements, the Association had a UK branch situated in the UK. The Registry as a separate subsidiary body has now been closed. Activities that were performed by the Registry, i.e. the collection of data to produce statistical studies, are carried out by the Academic Medical Centre of the University of Amsterdam. An agreement to this effect has been entered into between the Registry and AMC, details of which are in note 16 of the financial statements. A contract covering all aspects of the agreement has been drawn up and signed by the ERA and AMC. In addition to the quarterly payments made to the AMC under the terms of the contract, the ERA is responsible for the expenses incurred by members of the Scientific Committee.


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NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2001 2001 2000 1. Congress Euro Euro

Registrations received: Vienna 1,576,648.15 - Madrid (5,806.81) - Nice 41.46 1,530,101.87 1,570,882.80 1,530,101.87 Congress expenses incurred (note 2) Vienna 977,366.68 - Nice 9,114.62 942,702.19 Madrid - 2,713.17 Geneva - 133.87 986,481.30 945,549.23 Net congress proceeds 584,401.50 584,552.64 2001 2000 2. Direct charitable expenditure Euro Euro Congress expenses incurred (note 1) 986,481.30 945,549.23 Congress grants 23,256.31 - Salaries (note 7) 22,501.65 63,358.04 Mail 7,894.21 13,381.77 Printing (note 4) 4,200.84 4,968.08 Editorial office (note 5) 140,292.36 135,764.72 Cultural Initiatives 21,520.20 21,719.85 Registry expenses (note 6) 21,254.17 (5,011.05) Currency exchange losses 839.62 86,535.51 Presidents Office Expenses - 1,060.44 AMC consideration costs 248,131.69 173,116.02 1,476,372.35 1,440,442.61 2001 2000 3. Management and administration of the association Euro Euro Telecommunications 7,254.39 7,865.15 Technical services - 578.27 Salaries (note 7) 5,625.41 15,604.94 Consultants fees (note 8) 54,371.33 66,917.08 Stationery - 709.14 Council meetings 22,778.11 20,793.89 Travel expenses 8,232.93 8,846.88 Membership management charges 86,111.64 39,412.58 Mark up losses on Symphonia investments - 44,886.07 Taxes on Symphonia investments - 43,921.45 Miscellaneous (834.30) 3,992.08 Credit card commission and bank charges 42,152.81 15,373.81 AMC consideration costs – secretarial costs 15,233.36 14,774.28 Depreciation of fixed assets 8,810.18 10,700.13 Entertaining costs - (1,027.39) 249,735.86 293,348.36


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) YEAR ENDED 31 DECEMBER 2001 2001 2000 4. Printing Euro Euro

Costs 8,823.87 9,610.38 Refund of labels ERA-EDTA members (4,623.03) (4,642.30) 4,200.84 4,968.08 2001 2000 5. Editorial offices Euro Euro (a) Heidelberg Salaries - 3,361.67 General expenses 1,269.90 4,680.72 (b) Paris Salaries 58,856.31 86,998.12 General expenses 72,071.01 40,724.21 (c) Gent Salaries 7,968.87 - General expenses 126.27 - 140,292.36 135,764.72 2001 2000 6. Registry expenses Euro Euro General expenses met directly 21,254.17 (5,011.05) The above general expenses represent the following payments: Provision for redundancy expenses 1 January 2000 (£176,056.63) - (292,172.50) Actual redundancy costs paid in the year (£163,095.42) - 264,115.02 Adjustment for exchange rate - 4,621.79 Over provision of redundancy costs - (23,435.69) Travel expenses of visiting SAB delegates refunded by the Association 21,254.17 16,067.31 Other expenditure – Azua Amsterdam - 2,357.33 21,254.17 (5,011.05)


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) YEAR ENDED 31 DECEMBER 2001 2001 2000 7. Salaries Euro Euro Congress and Membership office – 5 persons – 40 hours per week - 64,085.10 Secretary-Treasurers office – 1 person – 32 hours per week 15,818.84 13,253.20 President’s office – 1 person – 24 hours per week 4,014.26 3,994.71 Taxes, social security and insurance 1,014.20 31,327.76 Severance pay fund annual adjustment - (41,009.52) Chief controller 7,279.76 7,311.73 28,127.06 78,962.98 Less: Direct Salaries (80%) (22,501.65) (63,358.04) 5,625.41 15,604.94 2001 2000 8. Consultants fees Euro Euro Macnair Mason – book keeping and accountancy services 41,115.01 41,416.73 Macnair Mason – audit fees (20%) 10,278.75 10,354.18 Legal and professional 1,810.69 14,215.84 Payroll services 1,166.88 930.33 54,371.33 66,917.08


Page: 19

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) YEAR ENDED 31 DECEMBER 2001 9. Tangible fixed assets

Software Office

equipment Electronic Equipment

Total

Euro Euro Euro Euro

Cost At 1.1.01 12,283.15 20,668.32 56,417.55 89,369.02 Additions - - 8,841.00 8,841.00 Scrapped in the year (6,032.57) (12,975.44) (32,097.94) (51,105.95) Cost at 31.12.01 6,250.58 7,692.88 33,160.61 47,104.07 Depreciation At 1.1.01 10,266.12 20,219.69 56,417.55 86,903.36 Charge for year 1,255.15 730.05 6,824.98 8,810.18 Scrapped in the year (6,403.89) (13,504.52) (35,975.91) (55,884.32) Depreciation at 31.12.01 5,117.38 7,445.22 27,266.62 39,829.22 Net book value At 31.12.01 1,133.20 247.66 5,893.99 7,274.85 At 31.12.00 2,017.03 448.63 - 2,465.66 Notes 2001 2000 Euro Euro

10. Investments Listed non-uk investments on recognised stock exchanges (a) UBS Euro investment account Market value 31.12.01 10a 283,552.92 308,996.32 (c) Azimut investment account Market value 31.12.01 10b 657,536.49 737,006.04 (b) Symphonia investment account Market value 31.12.01 10c 902,860.97 776,061.61 1,843,950.38 1,822,063.97 Unlisted UK Investment 4.91 4.91 1,843,955.29 1,822,068.88 Unlisted UK Investments held by the Association include the investment in the UK Subsidiary Company at Cost. (See note 17 to the financial statements).


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) YEAR ENDED 31 DECEMBER 2001 10a.

UBS Euro investment account

Book value

Market value 31.12.00

Additions

Proceeds

Realised gain/(loss)

Unrealised gain/(loss)


Interest

Euro Euro Euro Euro Euro Euro Euro Euro

(Lux) Strategy & UBS Growth 126 Units 308,996.32 - - - (25,443.40) 283,552.92 - Gains - - Losses - (25,443.40) As at 31 December 2001, the charity held an investment with UBS with a total market value of Euro 285,552.92, (2000 Euro 308,996.32). The investment within this portfolio exceeds 5% of the total market value. The above investments are Non-UK investments listed on a recognised stock exchange.

10b.

Azimut

Book value


Additions

Proceeds


Unrealised Gain/(loss)


Interest

Euro Euro Euro Euro Euro Euro Euro Euro Azimut Borse Internationali ) 33,120.752 shares ) 489,327.06 - - - (52,100.01) 437,227.05 - } Azimut Europa ) 247,678.98 - - - (27,369.54) 220,309.44 - 15,333.341 shares ) 737,006.04 - - - (79,469.55) 657,536.49 - Gains - - Losses - (79,469.55) As at 31 December 2001 the charity held an investment with Azimut with a total market value of Euro 657,536.49, (2000: Euro 737,006.06). Both of the investments within this portfolio exceed 5% of the total market value. The above investments are Non-UK investments listed on a recognised stock exchange.


Page: 21

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) YEAR ENDED 31 DECEMBER 2001 10c.

Symphonia SIM investment account

Market value

Additions

Proceeds

Charges deducted on transactions


Unrealised gain/(loss)


Investment income

31.12.00 Euro Euro Euro Euro Euro Euro Euro

Euro Fund 776,061.61 70,967,518.27 (70,670,229.58) (17,793.22) (9,123.40) (143,572.71) 902,860.97 13,217.35 Gains 391,689.39 29,920.55 Losses (400,812.79) (173,493.26) The above investments are Non-UK investments listed on a recognised stock exchange. As at 31 December 2001 the charity held investments with Symphonia SIM with a total market value of Euro 902,860.97, (2000: Euro 776,061.61). As at 31 December 2001 the charity did not hold any investments that exceeded 5% of the total portfolio. In accordance with the Council of Management Report, the total market value of Symphonia investments held at 31 December 2001 of Euro 902,860.97, (2000 Euro 776,061.61) together with cash funds of Euro 48,725.05, (2000 Euro 349,929.88) totalling Euro 951,586.02, (2000 Euro 1,126,845.27) which is below the ‘Reserve Fund Maximum Amount’ of Euro 2,500,000. Net Realised

(Losses) Net Unrealised

(Losses) 10.d Summary of Realised and Unrealised Losses Euro Euro UBS Euro Investment account - (25,443.40) Azimut - (79,469.55) Symphonia SIM investment account (9,123.40) (143,572.71) (9,123.40) (248,485.66)


Page: 22

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) YEAR ENDED 31 DECEMBER 2001 2001 2000 10.e Symphonia Investments Euro Euro

The following investment market values exceed 5% of the total portfolio: 1,965 shares - Nasdaq - 100 - 123,357.03 407 shares – S + P 500 Deposit - 57,419.75 2001 2000 11. Debtors Euro Euro Membership fees receivable 12,466.00 12,480.59 Congress registrations receivable 27,001.00 6,236.42 Congress expenses paid in advance 298,227.28 279,117.82 Amounts due from associated and subsidiary undertakings - 1,549.52 Donation receivable from trading subsidiary 1,200,000.00 - Other debtors 279,343.59 289,651.28 1,817,037.87 589,035.63 12. Cash at bank and in hand 2001 2000 Euro Euro Bank accounts 1,016,151.45 863,593.12 Editorial office bank accounts 215.06 215.06 Petty cash accounts 7,225.66 9,935.78 Post office account 7.90 7.70 1,023,600.07 873,751.66 13. Creditors 2001 2000 Euro Euro Bank overdrafts 132.87 67,258.98 Amounts due to associated and subsidiary undertakings 1,914.99 - Membership fees paid in advance 140,966.85 160,814.53 Congress registrations received in advance - Copenhagen 159.12 Congress expenses payable 18,917.00 10,882.57 Other creditors 204,135.33 221,022.92 Accruals 57,466.39 52,393.55 423,692.55 512,372.55 Included within ‘Other creditors’ are amounts payable by the following Editorial office: Paris – office expenses Euro 5,045.17, (2000 Euro 19,938.85)


Page: 23

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) YEAR ENDED 31 DECEMBER 2001 14. Accumulated funds

Included within the total of unrestricted funds of Euro 4,268,175.53, (2000 Euro 2,774,949.28), is a designated unrestricted fund. This fund is as detailed in the Report of the Council of Management on page 6 of the financial statements, and is designated to deal with extraordinary or unforeseen expenses in the future. As at 31 December 2001 this designated fund has accumulated income and reserves as detailed below:

Euro Euro 2001 2001 Amounts at 1 January 2001 1,126,845.26 Net realised gains 391,689.39 Net unrealised gains 29,920.55 Net realised losses (400,812.79) Net unrealised losses (173,493.26) Other net movements (22,563.13) Net movement in funds (175,259.24) 951,586.02 The total of Euro 951,586.02 represents: Investments with Symphonia at market value 902,860.97 Bank balances with Symphonia 48,725.05 951,586.02 15. Gifts

The Association and the Registry both receive services for which no costs are charged. The Association’s office situated at Hospital SAMS in Lisbon has free use of faxes, telephones, photocopier and stationery. No monetary amounts have been included within the financial statements as it is difficult to quantify these benefits and in the opinion of the Members of the Council, these benefits are not material to the accounts.

16. The Registry

On the 1st June 2000 the Association entered into a formal agreement with the Academical Medical Centre in Amsterdam. The AMC is a research organisation and is to assist ERA-EDTA with the organisation of data and information in the field of Nephrology. In accordance with the agreement and as a consideration for all services and activities provided by AMC, ERA-EDTA have agreed to remit a total of CHF 780,000 by the following instalments: - 12.5% on the date of signature of the agreement; - 12.5% at 3, 6, 9, 12, 15 and 18 months thereafter; and - 12.5% at the end of the two year period.


Page: 24

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) YEAR ENDED 31 DECEMBER 2001 17. Subsidiary undertaking

The Wholly-owned trading subsidiary, ERA Eurocongress Limited, which is incorporated in the United

Kingdom, pays all its profits to the charity by gift aid. ERA Eurocongress Limited carries on trading activities in connection with any congress arranged by the Association, in particular to sell exhibition and advertising space in conjunction with those congresses. The Association owns the entire issued share capital of 3 ordinary £1 shares. ERA Eurocongress Limited prepare financial statements to 31 December 2001 in sterling. A summary of the

trading results is shown below. Summary profit and loss account 2001 2000 £ £ Turnover 839,032 675,599 Cost of sales and administrative expenses (205,704) (190,728) Net profit 633,328 484,871 Amount gifted to charity (732,840) (364,179) Retained in the subsidiary (99,512) 120,692 The assets and liabilities of the subsidiary were: Current assets 1,106,158 1,099,629 Creditors: amounts falling due within one year (849,614) (297,336) Total net assets 256,544 802,293 Aggregate share capital and reserves 256,544 802,293

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