INTERNATIONAL PROFESSIONAL SECURIT1
)
Lrn[rrEn ASSOCTATTON ( HONG KONG (Incorporated in Hong Kong with limited tiabitity by guarantee)
EIHB#R*ffiB^(6iE)fi'FEAE REPORTS AIYD F'INAI{CIAL STATEMENTS f,.OR
TIIE YEAR ENDED 31 DECEMBER 2013
CONTENTS PAGE
2-3
Report of the Directors Independent auditor's report
4
Statement of comprehensive income
5
Statement of financial position
6
Statement of cash flows
7
Statement of changes in members' equrty
8
9-14
Notes to the financial statements
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INTERNATIONAL PROFESSIONAL SECURITY ASSOCIATION ( HONG KONG ) LIi\{ITED (Incorporated in Hong Kong with limited liability by guarantee)
REPORT OF THE DIRECTORS
The Board of Directors ("the Council") submit herewith its report and the audited financial statements of lnternational Professional Security Association (Hong Kong) Limited ("the Association") for the year ended 3l December 2013.
PRINCIPAL ACTTYITIES The principal activities of the Association are to support and improve the prestige and status of the security industry and to encourage, promote and establish the professional practice ofthe security industry.
FINANCIAL STATEMENTS
.
The Association's result for the year ended
3l
December 2013 is set out in the statement
of
comprehensive
income on page 5.
TheAssociation'sstateofaffairsat3l December2013 issetoutinthestatementoffinancialpositiononpage6.
COUNCIL MEMBERS The Council members in office during the year and as at the date of the report were:
Chairman Mr. LAM KOON FU Vice-Chairman IVK. LEE YU YIM Other Council members iVK. YUEN SEE TUNG MT.
LAUKARIP
IVIT.
KI.ING NGAN HUNG EDMUND
HI.II CHUN YIN Mr. LAU KIM WAI
IVK.
MT. IP KIN MAN IVK.
LEUNGNIMHO
Mr. SIN HON TAO IVK. TSO Sru WAH IVIT. LAI WAI KEE IVfu.
YUENLLIENKWAN
(Re-appointed on 28. 5.20 1 3) (Re-appointed on
2
8.5.20 1 3)
(Appointed on 28.5.2013) (Re-appointed (Re-appointed (Re-appointed (Re-appointed (Re-appointed (Re-appointed (Re-appointed (Re-appointed (Re-appointed
3) 3) I 3) 1 3) I3) I 3) I 3) 1 3) on26.6.2012 and retired on 28.5.2013) (Re-appointed on26.6.2012 and retired on 28.5.2013) on on on on
28.5.20 28.5.20 28.5.20 28.5.20 on 28.5.20 on 28.5.20 on 28.5.20 on 28.5.20
I
1
In accordance with the provision in the Association's Articles of Association, all Council members shall retire from office in the forthcoming Annual General Meeting, but being eligible, offer themselves for re-election.
INTERNATIONAL PROFESSIONAL SECI]RITY ASSOCIATION ( HONG KONG ) LIMITEI) (Incorporated in Hong Kong with limited liability by guarantee)
COUNCIL MEMBERS' INTERESTS No contract of sipificance, to which the Association was a parly and in which a Council member had a material interest subsisted at the end of the reporting period or at any time fitring the year.
AIJDITORS The Association's auditor, Messrs. Eric C W Ko offer themselves for re-appointment.
& Co., Certified Public Accountants, retire and being eligible,
On behalf
Hong
Kong,
- 7 },|AY 2014
-3-
oftle
Council
ERIC C W KO
g OOMPAD{Y
GefiiJie d Public Accountsats
H& E@ E+ En.g-r5 fr INDEPENDENT AUDITOR'
S
REPORT
TO TIIE MEMBERS OF INTERNATIONAL PROF'ESSIONAL SECURITY ASSOCIATION (HONG KONG) LIN{ITED (Incorporated in Hong Kong with limited liability by guarantee) We have audited the financial statements of International Professional Security Association (Hong Kong) Limited ("the Association") set out on pages 5 to 14, which comprise the statement of financial position as at 3l December 2013, and the statement of comprehensive income, the statement of changes in members' equity and the statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes.
Directors' responsibility for the financial statements The directors ("Council members") of the Association are responsible for the preparation of financial statements that give a true and fair view in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants (*HKICPA") and the Hong Kong Qsmpanies Ordinance, and for such intemal control as the Cogncil members determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's responsibility Our responsibility is to express an opinion on these financial statements based on our audit. This report is made solely to you, as a body, in accordance with section 141 of the Hong Kong Companies Ordinance, and for no other purpose. We do not assume responsibility towards or accept liability to any other person for the contents of the report.
We conducted our audit in accordance with Hong Kong Standards on Auditing issued by HKICPA. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves perfonning procedures to obtain audit evidence about the amounts and disclosures in
the
financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or eror. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Council members, as well as evaluating the overall presentation of the flrancial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion In our opinion the financial statements give a true and fair view of the state of the Association's affairs as at 31 December 2013 and of its surplus and cash flows for the year then ended in accordance with Hong Kong Financial Reporting Standards and have been properly prepared in accordance with the Hong Kong Companies Ordinance.
EricCWKo&Co. Certifi ed Public Accountants Hong Kong
HongKong,
-7 F4AY
?CI14
-4ROOMA, I3lF,, ETON BI]ILDING,288 DES VOEIIX ROAD CENTRAL, S}IEI]NG WAN, HONG KONG
TEL: (852) 2805 1838
FAx: (8s2) 2851 1683
6*IH€ffi E+:AAffi ,8fi #tE+:EAB
Eif;:(8s2) 280s
tsH:(ss2) 28sl
1838
1683
INTERNATIONAL PROFESSIONAL SECI'RITY ASSOCIATION ( HONG KONG ) LIN{ITEI) (Incorporated in Hong Kong with limited liability by guarantee)
STATEM.ENT OF COMPREIIENSIYE INCOME FOR TITE YEAR ENDED 31 DECEMBER 2013
2013
2012
Note
HI<$
HI$
2 (b)
108,250
105,900
26,170
7,820
10,000 1s0
151
Total revenue
144,570
ll3,87l
Members' activities costs
(49,236 )
(35,853 )
Administration support fee
(41,700 )
(39,000 )
Other operating expenses
(35,726 )
(30,242)
17,908
8,776
17,908
9,776
Subscription and fees
Other revenue Members' activities Sundry income Bank interests received
2@)
Surplus before tax
5
Tax
6
I
Surplus after tax and total comprehensive income for the year
5-
&3
INTERNATIONAL PROFESSIONAL SECTruTY ASSOCIATION ( IIONG KONG ) LIMITED (Incorporated in Hong Kong with limited liability by guarantee)
AS AT 31 DECEMBER 2013
Note
Non-current
2013
2012
HI<$
HK$
assets
Fumiture and equipment
Current
1,622
assets
Other receivables and prepayment Cash and bank balances
2,473
1,957
254.492
240.083
256.96s
242.040
15,250 14,146 66.226
19,950 14,050 66.226
95,622
100.226
161,343
14r,814
_______l!l;44
143,436
131,344 30,000
113,436 30,000
16l,3M
143,436
Current liabilities Subscription and fees received in advance Other payable and accruals Amount due to a related party
t1
Net current assets Net assets
Members'equity General Fund Special Fund
9
l0
Approved and authorized for issue by the Council on
Council member (Treasurer)
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INTERNATIONAL PROFESSIONAL SECtruTY ASSOCIATION ( HONG" KONG ) LIMITED (Incorporated in Hong Kong with limited liability by guarantee)
FOR TITE YEAR ENDED 31 DECEMBER 2013
2013
2012
HKS
HKS
5
17,908
8,776
Depreciation
7
1,276
1,615
Loss on written offfurniture and equipment Interest income
5
345
Note Cash flows from operating activities Surplus before tax
Adjustnents for
:
Operating cash flows before
rnrrirn, capital
(ls0 changes
(Increase) in other receivables and prepayment @ecrease/Increase in subscriptions and fees received in advance Increase/@ecrease) in accruals
(1s1 )
19,379
10,240
(516 (4,700
8,750
96
Qzs )
(4,382)
_ yt,259
14,393
Cash flows from investing activities Interest received
150
151
Net cash generated by investing activities
150
t5l
Net increase in cash and cash equivalents
14,409
14,534
140,083
125,549
1,54,492
140,083
Net cash generated by operating activities
Cash and cash equivalents at the beginning
of
the reporting period
CASH ATID CASH EQUWALENTS AT THE EI\D OF THE REPORTING PERIOD
INTERNATIONAL PROFESSIONAL SECI]RITY ASSOCIATION ( IIONG KONG ) LIMITED (Incorporated in Hong Kong with limited liability by guarantee)
STATEMENT OF CHANGES IN MEMBERS' EOUTIY FOR THE YEAR ENDED 31 DECEMBER 2013
General Fund
HK$
Special
Fund HI<$
Total
HK$
2013
At I January 2013 Total comprehensive income for the year
At 31 December 2013
113,436
143,436
17,908
17,908
131,344
30,000
161,344
2012
At I January 2012 Total comprehensive income for the year At 31 December 2012
104,660
134,660
9,776
8,776
______1pfi6
30,000
143,436
INTERNATIONAL PROFESSIONAL SECI]RITY ASSOCIATION ( IIONG KONG ) LIMITEI) (Incorporated in Hong Kong with limited liability by guarantee)
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2013
l.
PRINCIPAL ACTIVITIES AND REGISTERED OFFICE The Association is a body corporate incorporated in Hong Kong under the Hong Kong Companies Ordinance with limited liability by guarantee. Its registered office is situated at A l3ll'., Eton Building, 288 Des Voeux Road Central, Sheung Wan, Hong Kong. Its principal activities are to support and improve the prestige and status of the security industry and to encourage, promote and establish the professional practice ofthe security industry.
,'
BASIS OF'PREPARATION AND PRINCIPAL ACCOUNTING POLICIES
(a)
Basis of Preparation
The financial statemeits have been prepared in accordance with the Hong Kong Financial Reporting Standards ("HKFRSs"), which include all Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards ("HKASs") and interpretations issued by the Hong Kong lnstitute of Certified Public Accountants ("HKICPA"), accounting principles generally accepted in Hong Kong and the Hong Kong Companies Ordinance. The furancial statements have been prepared under the
historical cost convention.
The preparation of financial statements in confonnity with HKFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applyng the Association's accounting policies. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may difFer from these estimates.
ln preparing the financial statements, the Association has adopted all HKFRSs which are relevant to the activities of the Association and effective for the preparation of these financial statements. The adoption of these neilrevised HKFRSs does not have any significant effect on the results or the financial position of the Association. (b)
Revenue Recognition Revenue is recognized when it is probable that the economic benefits will flow to the Association and when the revenue can be measured reliably. First registation fees and annual subscription fees are recognized in the reporting period of receipt. Income from member activities are recognized upon completion of services provided.
(c)
Impairment of non-financial
assets
Intemal and external sources of information are reviewed at the end of each reporting period to identiff indication that assets may be impaired or an impairment charge previously recognized no longer exists or may have decreased. If any such indication exists, the asset's recoverable amount is estimated. The recoverable amount of an asset is the higher of its fair value less costs to sell and value in use. An impairment charge is recognized in the surplus or deficit whenever the carrying amount of an asset exceeds its recoverable amount.
An impairment charge is reversed if there has been a change in the estimates used to determine the recoverable amount and which results in an increase in the recoverable amount. A reversal of impairment charges is limited to the asset's carrying amount that would have been determined had no impairment charge been recognized in prior periods. Reversals of impairment charges are credited to the surplus or deficit in the period in which the reversals are recognized"
INTERNATIONAL PROFESSIONAL SECIIRITY ASSOCIATION ( HONG KONG ) LIN{ITED (Incorporated in Hong Kong with limited liability by guarantee)
FOR THE YEAR ENDED 31 DECEMBER 2013
2.
BASIS OF PREPARATION AND PRINCIPAL ACCOUNTING POLICIES (cont'd)
(d)
Furniture and equipment Furniture and equipment are stated at cost less accumulated depreciation and impainnent charges. The cost of an item of furniture and equipment comprises its purchase price, including import duties and non-refundable purchases taxes, after deducting trade discounts and rebates, and any cost directly attributable to bringing the item of furniture and equipment to the location and condition necessary for it to be capable of operating in the manner intended by management. Expenditure incurred after the item of furniture and equipment have been put into operation, such as repairs and maintenance cost, is normally charged to the surplus or deficit in the period in which it is incurred. In situations where it can be clearly demonstrated that the expenditure has resulted in an increase in the future benefits expected to be obtained from the use of the item of furniture and equipment and where the cost of the item can be measured reliably, the expenditure is capitalized as an additional cost to that asset or as a replacement. An item of furniture and equipment is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on disposal or retirement recognized in the surplus or deficit in the period the asset is derecognized, is the difference between the net disposal proceeds and the carrying amount of the item.
Depreciation is calculated to write off their depreciable amounts over their estimated useful lives using the straight-line method. Depreciable amount is the cost of an asset or other amount substituted for cost, less its residual value. The residual values and useful lives of assets and the depreciation method are reviewed at the end of each reporting period and, if expectations differ from previous estimates, the changes will be accounted for as a change in an accounting estimate. If the residual value of an asset increases to an amount equal to or greater than the asset's carrying amount, no depreciation is charged. The annual depreciation rate adopted for furniture and equipment is 25%o.
(e)
Foreign currency translation
(r)
Functional and presentation currency Items included in the financial statements of the Association are measured using the currency
of
the primary environment in which the Association operates (the frrnctional currency). The financial statements are presented in Hong Kong dollars, which is the Association's functional and presentation currency.
(iD
Transactions and balances Foreign culrency tansactions are translated into the functional currency at the exchange rates
ruling at the transaction dates. Monetary items denominated in foreign currencies
are
kanslated into Hong Kong dollars at the rate of exchange prevailing at the end of the reporting period. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the date of the transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. All exchange differences are recognized in the surplus or
deficit.
r0
NTERNATIONAL PROFESSIONAL SECURITY ASSOCIATION ( IIONG KONG ) LIMITED (Incorporated in Hong Kong with limited liability by guarantee)
NOTES TO TIIE FINANCIAL STATEMENTS FOR THE YEAR EI\DED 31 DECEMBER 2013
BASIS OF PREPARATION AND PRINCIPAL ACCOUNTING POLICIES (cont'd)
(0
Employee benefits
(i)
Retirement benefits costs The Association operates one approved defined conkibution retirement benefits scheme for employees : a MPF Scheme under the Mandatory Provident Fund Schemes Ordinance. The contributions payable to the Association's defined contribution retirement benefits scheme are charged to the surplus or deficit as incurred.
(ir)
Employeeleav&ntitlements Employee entitlements
to annual leave are recognized when they accrue to employees. An
accrual is made for the estimated liability for annual leave as a result of services rendered by the employees up to the end of the reporting period.
(g)
Related parties
A related parry is
(i)
(i)
(h)
a person
or entity that is related to the Association.
A person or a close member of that person's family is related to the Association if that person
(a) (b) (c)
:
has control or joint control over the Association; has significant influence over the Associatiory or
is a member of the key management personnel of the Association.
An entity is related to the Association if any of the following condition applies : (a) The entity is controlled orjointly controlled by a person identified in (i). O) A person identified in (i)(a) has significant influence over the entity or is a member of the key management personael of the entity (or of a parent of the entrty).
Cash and cash equivalents Cash and cash equivalents comprise cash at bank and on hand, demand deposits with banks and other
financial institutions, having been within three months of maturity at acquisition.
(D
Equity
For the purpose of capital disclosure, the Council regards the special fund as capital of the Association.
3.
MEMBERS' ACTIVITIES Members' activities represents AGM, seminars and talks, etc. held during the reporting activities costs comprise venues expenses, tutors fee and administration fee, etc.
1i
period.
Members'
INTERNATIONAL PROFESSIONAL SECURITY ASSOCIATION ( HONG KONG ) LIN{ITED (Incorporated in Hong Kong with limited liability by guarantee)
NOTES TO TIIE FINAI\CIAL STATEMENTS FOR THE YEAR EI\DED 31 DECEMBER 2013
4.
COUNCIL MEMBERS' EMOLI]MENTS Council Members' emolument disclosed pursuant to section 161 of the Companies Ordinance are Nil. (2012 :Nil).
5.
ST'RPLUS BEFORE TAX Surplus before tax is arrived atafter charging :-
6.
2013
2012
IIK$
HK$
Auditors' remuneration
6,500
6,000
Depreciation Loss on written off furniture and equipment
1,276
1,615
345
TAXATION No Hong Kong profits tax has been provided for in the financial statements as the Association is eligible to be exempted from Hong Kong profits tax under Section 24 of the Inland Revenue
Ordinance. (2012 : Nil)
There is no deferred tax liability.
FURNITURE AND EQUIPMENT Equipment HKS Costs
At3t.t2.20t2
70,229
Written off
(9,206 )
At3t.t2.20t3
61,023
Accumulated depreciation
At3t.t2.20t2 Charge for the year
68,607 1,276
Written off
(8,861 )
____
At3l.t2.20t3
rL92_
Net book value
At3t.t2.20t3 At3t.t2.20t2
_________t@_
-12-
INTERNATIONAL PROFESSIONAL SECI]RITY ASSOCIATION ( HONG KONG ) LIN{ITEI) (Incorporated in Hong Kong with limited liability by guarantee)
NOTES TO TIIE FINAI\CIAL STATEMENTS FOR TIIE YEAR EI\DED 31 DECEMBER 2013
CASH A}[D BANK BALAI\CES
Bank current accounts Cash on hand Cash and cash equivalents Time deposits
2013
2012
HK$
HK$
148,027
136,422
6,465
3,661
154,492 100,000
140,083 100,000
2s4,492
240,083
Time deposits are deposits with banks with maturity dates of more than three months from dates of deposits.
9.
GEIIERAL FUND At the beginning of the reporting period Total comprehensive income for the year
113,436
104,660
17,90_8
r,r:-u
Less : Amount transferred to Special Fund
At the end of the reporting period
10.
131,344
SPECIAL FUND At the beginning of the reporting period Transferred from General Fund
30,000
30,000
At the end of the reporting period
30,000
30,000
The Special Fund is maintained for provision of members' undertaking to contribute to the assets of the Association, in the event of the same being wound up during the time that he is a member or within one year afterwards, for payment of the debts and liabilities of the Association contracted before the time at which the member ceases to be a member, and of the costs, charges and expenses of winding up of the Association.
11.
AMOUNTDTIE TO ARELATED PARTY The amount due is unsecured, interest-free and have no fixed repayment terms.
t3
INTERNATIONAL PROFESSIONAL SECURITY ASSOCIATION ( HONG KONG ) LIN{ITED (Incorporated in Hong Kong with limited liability by guarantee)
NOTES TO THE F'INANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2013
12. FINAI\CIAL RISK MAJ\AGEMENT Financial instruments consist of "ffade and other receivables", "cash and bank balances", "amount due to a related party" and "accruals". Being a member-based organization, the Association ca:ries as little risks from financial instruments as practicable. The Association is exposed to various financial risks which are discussed below :-
(a)
Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in market interest rates. The Association is subject to the risk due to fluctuations in the prcvailing levels of market interest rates on its cash and bank balances but the risk is minimal. The effective interest rates of the Association's interest bearing financial assets axe as
follow:-
Time deposits (Note 8)
2013
20L2
HI$
IIK$
100,000
100,000
p.a. 0.1504
Yo p.a.
'/o Efflective interest rate of time deposits
(b)
0.lsYo
Credit risk Credit risk is the risk that a counterparty will be unable to pay amounts in full when due. The Association have designated their credit policies with an objective to minimize their exposure to credit risk. The Association's other receivables are very short term in nature and the associated risk is minimal. Subscriptions fees and income from member activities are collected in advance. The Association's surplus cash has been deposited with reputable and creditworthy bank. Management considers there is a minimal risk associated with the bank balances.
(c)
Liquidity risk Liquidity risk is defined as the risk that an entrty will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial assets.
The Association exercises prudent investment policy by only investing in time deposits held with reputable and creditworfty bank and considers that liquidity risk is minimal.
CAPITAL MAIIAGEMENT The Council's objectives when managing capital are to safeguard the Association's ability to continue as a going concern to enable their obligations under the Hong Kong Companies Ordinance and its principal activities to be accomplished and to provide capital for the purpose of skengthening the Association's operational efficiency. The subscription fees from members provide a stable source of funds to the Association. The Council regularly reviews and manages its capital to ensure adequacy for both the operational and capital needs.
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