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The Actuary The magazine of the Institute & Faculty of Actuaries

Faculty and Institute – income and expenditure 2006/2007

The majority of the work of the UK actuarial profession is conducted jointly by the Faculty and the Institute, and is currently organised through the Board structure. Not unexpectedly, the major part of the expenditure of the UK profession in 2006/2007excluding services and pension costs is controlled by the Education and CPD Board, which has a wide-ranging remit that includes examinations, CPD events, research, the BAJ/Annals and libraries, and international education.

Nature of expenditure and income

The actual expenditure in terms of goods, services, and other items, totalled £14.7m.

The sources of the profession’s income totalled £16.2m in 2006/2007. As less than half is represented by subscriptions, any deviation from budget has a potentially magnified effect on subscription levels. This underlines the need for adequate reserves to absorb unexpected fluctuations.

Share of net expenditure

The net expenditure on joint activities is shared between the Faculty and the Institute according to a ratio based on full-rate membership numbers. The ratio for 2006/2007 was 14.3:85.7. The two bodies also incur expenditure on business related to their own activities. Joint working does not give rise to audited accounts as one entity. The total income and expenditure for each of the Faculty and Institute is reported in their respective statutory accounts. Around 95% of each body’s expenditure is on joint activities and around 5% on its own business.

  • The surplus of £1.5m in 2006/7 was higher than that in 2005/2006 (£0.5m). This reflected an increase in joint income due to the increases in subscription fees and exam entries, together with strong attendance levels at continuing professional development events.
  • Expenditure rose to £14.7m from £13.2m in part due to additional contributions towards the deficit in the staff pension scheme (which was closed to new members from 2003).
  • Costs are regularly and thoroughly reviewed, which is reflected in the reduction in costs, year on year, in many areas.
  • Summary joint accounts are set out in the annual report and full details of the individual statutory accounts of the Faculty and the Institute are available on the website.

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