As you will be aware Clyde Eastaugh LFAPI has been appointed as interim National Director while the search for a permanent replacement for David Haythorn continues.
Clyde brings with him considerable knowledge of the API and a great deal of business acumen which has already started to have a positive impact after what has been a challenging time for many involved with the API. It is a real pleasure to work with him and on behalf of members, I want to welcome him and thank him for agreeing to step into the role.
While I acknowledge recent media comment about the operations of the API, and the concern some members have expressed around the past expenditure of API cash reserves, it is time to look forward. That said, in looking forward we all accept that we must learn lessons from past experiences to ensure the API remains in a strong financial position. That is the only way we can continue to expand the organisation, grow member services and be relevant to an even wider group of property professionals.
With that comment in mind, it is pleasing to see our membership numbers have been growing over the last 12 months. However, member feedback suggests that this will continue only if we stay on an evolutionary path and remain focused on members.
I also want to point out that the investments, which contributed to the draw down on cash reserves, represent money spent on projects designed to enhance member benefits. These include IT upgrades, CPV marketing, the capped liability scheme and the Future Professionals Program – to name just a few. I have publicly stated many times that some of these projects have been more successful that others, but all have been planned with the aim of supporting members and it is pleasing to see many of these projects starting to pay dividends.
My focus remains on moving forward with changes that have been spoken about for many years and in recent times, major firms who represent and employ a significant number of our members, have made it clear that they want. No plans are possible without funds and I can report that due to the hard work of staff in Divisions, including some innovative CPD programs and the success of several National projects, the financial position at the end of 2013 is forecast to be significantly better than budgeted.
The API cash reserves are over $2 million and the net assets are around 11 million. The API is forecasting a $378,794 end of year 2013 operating cash surplus, which is $271,414 (252.8%) better than budgeted.
Some major Divisional projects were undertaken in 2013 including the fully approved and strategically sound move by the WA division to relocate office premises and lease out the building in Charles Street South Perth.
We have also started to action the Structure & Governance Review as part of a three-year plan designed to identify areas where the corporate structure, reporting lines and operational activities can be improved. We believe success in this area will allow the API to establish a better platform to ensure we have a single voice advocating for members rights across the country.
I also wish to inform valuer members that API recently made a submission to the ATO regarding the valuation of real property assets within Self-Managed Super Funds (SMSF). The API is concerned that current ATO guidance, which does not require real property assets within funds to be valued by a qualified valuer, could have significant implications which have been outlined to the ATO.
The API’s submission reiterated our rigorous standards for ongoing professional development, qualifications, ethics and professional indemnity insurance. The ATO was also reminded that API members were subject to a disciplinary process and could provide fund holders with a level of protection not provided elsewhere in the market place.
The API believes that any real property put into a SMSF should be subject to a valuation carried out by a suitably qualified professional on entry into the fund and also when audits are required. We will continue to keep members informed of progress on this issue.
On a personal note, I invite anyone who would like to discuss any of the above issues to call or email me. I know how important it is to retain open lines of communication and I am always available to speak with members about their concerns or ideas. You can reach me at email@example.com or on my mobile 0403 589 994.
In closing, I wish everyone a happy, safe and enjoyable Christmas and a prosperous New Year in 2014.