Ordnance Survey report operating profit of £16.3 million!
Source: Ordnance Survey of Great Britain, UK
Ordnance Survey publishes Annual Report and Accounts for 2008–2009
Southampton: 8 July 2009
The Ordnance Survey has published their Annual Report and Accounts for the year ended 31 March 2009 that were presented to Parliament on Wednesday 8 July 2009.
Page 9 of the annual report headed Business Strategy states:
“Our new business strategy was announced in April 2009 as part of the Treasury’s Operational Efficiency Programme report and the Trading Funds Assessment; following considerable work during 2008–09.”
“The Government has set key milestones for delivery of the strategy over the next year and the Shareholder Executive and the Office of Public Sector Information, in consultation with the Office of Fair Trading, will be regularly reviewing progress.”
Page 14 of the annual report states:
“Ordnance Survey achieved a surplus on ordinary activities before interest and dividend payable for the year of £16.3 million (2007–08: £22.5 million). The underlying reduction in profit reflects an increase in operating costs of £4.7 million and a reduction in turnover of £1.5 million.”
Analysis of turnover from trading activities
£ million 2008–09 (2007–08)
Direct licences 73.2 (74.0)
Partner licences 29.1 (27.4)
Total licences 102.3 (101.4)
Paper maps 8.9 (9.6)
Services 4.8 (5.9)
Total 116.0 (116.9)
Page 17 of the report states:
“Dividends
A dividend of £4.8 million will be paid in respect of 2008–09 (2007–08: £3.7 million). The dividend is calculated on a 6.0% return on average capital employed for the year when combined with interest paid on Government loans. This dividend has been agreed with CLG.”
Page 53 of the Financial Accounts states:
“Adverse opinion on the financial statements
Ordnance Survey’s turnover of £117 million derives principally from the exploitation of data held in its National Geographic Database, the creation of which has been funded by the past investment of public funds. As disclosed in Note 1.7 to the accounts, Ordnance Survey has not capitalised the cost of setting up and maintaining the geographic data in its balance sheet. In Ordnance Survey’s view, the data is an intangible fixed asset that does not meet the conditions for capitalization set by Financial Reporting Standard 10. In my opinion, the data held is a tangible fixed asset that should be capitalized in accordance with Financial Reporting Standard 15. Had this data been capitalised, we consider that the effect would have been to increase the tangible fixed assets included in the balance sheet at 31 March 2009 by a material amount.
In my opinion:
- In view of the effect of the decision not to capitalize the geographic data held as a tangible fixed asset in accordance with Financial Reporting Standard 15, the financial statements do not give a true and fair view of the state of Ordnance Survey’s affairs as at 31 March 2009 or of its surplus for the year then ended;
- In all other respects, the financial statements and the part of the Remuneration Report to be audited have been properly prepared in accordance with the Government Trading Funds Act 1973 and HM Treasury directions made thereunder; and
- Notwithstanding our adverse opinion on the financial statements, information, which comprises the Business Review, Financial Review and sections entitled ‘Business Performance’, ‘Corporate Responsibility’ and ‘Our Directors’ included within the Annual Report, is consistent with the financial statements.”
“Report
Details of my adverse opinion are set out in my report on the 2007–08 accounts (HC751, 2007–08), the facts of which are still relevant to the 2008–09 accounts. I have no further observations to make on these accounts.”