63 rd FIFA Congress Mauritius, 30 and 31 May 2013 FINANCIAL REPORT 2012

Transcription

1 63 rd FIFA Congress Mauritius, 30 and 31 May 2013 FINANCIAL REPORT 2012

2 Income statement 2012 USD million Financial income 1,200 1, , , Financial expenses Development-related expenses Exploitation of rights 750 Event-related revenue 600 1, Event-related expenses 450 Other operating income Other operating expenses Football governance Revenue Expenses Result Balance sheet as at 31 December 2012 USD million Assets 2,683 Current assets 2,175 Liabilities and reserves 2,683 Current liabilities 1,168 Non-current liabilities 137 Non-current assets 508 Reserves 1,378

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5 63 rd FIFA Congress Mauritius, 30 and 31 May 2013 FINANCIAL REPORT 2012

6 Contents 2

7 Foreword 4 FIFA President 6 Chairman of the Finance Committee 8 Chairman of the Audit and Compliance Committee Foreword Facts & Figures Overview 14 Income statement 16 Balance sheet 20 Budget comparison Facts & Figures Period 26 Detailed budget for Period Special Topics 30 Good governance reforms 32 Asset management report 38 FIFA Club Protection Programme Special Topics Annexe Auditor s report 96 Audit and Compliance Committee report Annexe

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9 Foreword 01 Natalia Gómez Junco (L) of Mexico and Cinzia Joerg (R) of Switzerland battle for the ball during the FIFA U-20 Women s World Cup 2012 match between Mexico and Switzerland at Miyagi Stadium in Japan on 22 August.

10 Foreword The good governance process is on track. 6

11 01 FIFA President 6 Chairman of the Finance Committee 8 Chairman of the Audit and Compliance Committee 10 Dear football friends, Foreword It is with great pleasure that I present the Financial Report 2012, which once again reveals another prosperous year for FIFA from an economic point of view. Thanks to our healthy balance sheet, we can continue to focus our efforts on the improvement of both the beautiful game itself and of our many competitions. In line with the organisation s mandate to serve the sport, our FIFA team recorded many remarkable achievements in 2012, ranging from the successful staging of eight FIFA competitions (in particular the FIFA U-17 and U-20 Women s World Cups, the FIFA Futsal World Cup and the annual FIFA Club World Cup) to the effective implementation of the very ambitious but essential road map for good governance. The reform plan I tabled at the 61 st FIFA Congress received the full support of delegates and marked the beginning of a reform process. At the 62 nd FIFA Congress, FIFA s judicial system and the creation of an Audit and Compliance Committee. The reform process will be completed by the 63 rd FIFA Congress in Facts & Figures Period In addition, with only a few months left before the start of the FIFA Confederations delighted to announce that preparations for the 2014 FIFA World Cup Brazil are well under way and proceeding according to plan. for the future tasks that lie ahead. I would like to thank you for all of your valuable support and I have no doubt that together we can meet any challenge that may come our way. Special Topics For the Game. For the World. Joseph S. Blatter FIFA President Annexe

12 Foreword The FIFA Club Protection Programme has been successfully implemented. 8

13 01 FIFA President 6 Chairman of the Finance Committee 8 Chairman of the Audit and Compliance Committee 10 Dear Sir or Madam, Foreword optimism for the remaining half of the cycle. The development of FIFA s revenues and costs is progressing according to plan, despite the continued challenging global economic situation. This has been achieved by keeping costs under control and by successfully commercialising our rights. At the same time, FIFA has preserved its assets via prudent asset management. Facts & Figures 2012 directly in the beautiful game itself, whether through our many worldwide football development programmes or through the various FIFA competitions. One of the many milestones achieved in 2012 was the successful implementation and member associations as well as the players and clubs, and provides for a global harmonised solution Period calendar. The programme runs from 1 September 2012 to 31 December 2014 and was also valid for the 2012 Olympic Football Tournament in London. in greater detail at the 63 rd FIFA Congress in Mauritius. On behalf of the Finance Committee, I would like to thank you for all of the trust and support you have placed in us over the past years. Special Topics Julio H. Grondona Chairman of the Finance Committee Annexe

14 Foreword An effective compliance programme has been put in place. 10

15 01 FIFA President 6 Chairman of the Finance Committee 8 Chairman of the Audit and Compliance Committee 10 Dear Sir or Madam, Foreword capacity as chairman of the newly constituted Audit and Compliance Committee, particularly given the positive economic results recorded at the halfway mark of the Following the good governance reform process, the role of the new Audit and oversight now represent its major tasks. The chairman and deputy chairman must charter and are part of the FIFA Organisation Regulations. The new Audit and Compliance Committee has been founded on these criteria and improvements have taken place in recent years, I am convinced that the committee s independence through its oversight and monitoring role can contribute to further organisational processes and standards and maintaining an effective compliance programme. FIFA has undergone considerable changes over the years, evolving from a small organisation that primarily regulated the game of football to the important economic entity it is today. Consequently, it was the right decision to support the FIFA President s proposal for a good governance reform process. My colleagues and I in the Audit contributing to the overriding objective of this governance reform: strengthening unique organisation. Facts & Figures Period Special Topics Domenico Scala Chairman of the Audit and Compliance Committee Annexe

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17 Facts & Figures Panama s goalkeeper Jaime Penedo in action 2014 FIFA World at the BMO Field in Toronto, Canada.

18 Facts & Figures 2012 Overview Income statement and development of reserves As decided by the Congress in 2010, FIFA is planning for a moderate increase in its reserves during the period. Because more funds are being invested period. draw to a close in the year of the 2014 FIFA World Cup Brazil. FIFA has so far crisis unscathed, as proven by the following facts: 2012 was a very successful year for FIFA, with a positive annual result of USD 89 million. In comparison to the previous year, revenue increased in 2012 to USD 1,166 million. Overall, the sale of rights for the 2014 FIFA World Cup Brazil, particularly in the area of marketing, generated higher income than for the 2010 FIFA World Cup. Expenditure also increased in comparison with the previous year to USD 1,077 million. In total, 69% of overall expenditure was invested directly in football. FIFA s conservative investment policy and the of USD 12 million. Systematic cost control once again proved its worth and costs were 6% below the 2012 expense budget. The strategy of hedging foreign currencies also proved to be fully effective in 2012 and protected FIFA against losses. As planned, FIFA s reserves increased by 7% and stood at USD 1,378 million on 31 independence and to its ability to react to unexpected events. 14

19 02 Overview 14 Income statement 16 Balance sheet 20 Budget comparison 22 Income statement and USD million 1,291 1,059 1, ,166 Foreword Revenue ,089 1,034 1,077 Facts & Figures 2012 Expenses Result Period Development of reserves USD million 1,280 1,293 1,378 Special Topics 902 1, December Annexe

20 Facts & Figures 2012 Income statement Revenue 2012 This page provides an overview of the total revenue the FIFA Congress in Zurich in 2011, it was decided that the renowned international KPMG s report can be found in the annexe on page 96. The report from the Audit and Compliance Committee is on page 98. Total revenue amounted to USD 1,166 million, comprised of event-related In terms of the event-related revenue of was attributable to the sale of television rights, of which the lion s share USD of income was the sale of marketing rights worth USD 370 million, of which USD 367 million was generated by the FIFA World Cup. The sale of licensing rights income was made up primarily of revenue from the FIFA Club World Cup, which was matched, however, by comparable costs. The other operating income of was attributable in particular to Programme. FIFA s of was the result of the conservative investment strategy and was primarily made up of interest income of USD 7 million 16

21 02 Overview 14 Income statement 16 Balance sheet 20 Budget comparison 22 Revenue 2012 USD million Other operating income (5%) Total 59 Financial income (8%) Total 89 Foreword 100% = USD 1,166 million Facts & Figures 2012 Event-related revenue (87%) Total 1, Period Special Topics FIFA Partners Annexe

22 Facts & Figures 2012 Income statement Expenses 2012 Total expenditure amounted to, arising from event-related expenses, development-related expenses, other operating expenses, football expenditure was invested directly in football. Of the event-related expenses of, USD 448 million was related to the 2014 FIFA World Cup Brazil. FIFA also organised eight other competitions in 2012 (the Men s and Women s Olympic Football Tournaments in London, the FIFA U-20 Women s World Cup in Japan, the FIFA U-17 Women s World Cup in Azerbaijan, the FIFA Futsal World Cup in Thailand, the FIFA Club World Cup in Japan, the Blue Stars/ FIFA Youth Cup, and the FIFA Interactive World Cup), which accounted for USD 103 million. FIFA spent a total of or of overall expenditure on development projects, allocating USD 68 million to the Financial Assistance Programme (FAP for member associations and confederations), USD 29 million to the Goal Programme and USD 80 million to other development projects. The other operating expenses of were mainly made up of personnel expenses of USD 91 million and of communications (e.g. FIFA.com and extranet) of USD 24 million. Football governance expenses of covered the organisation of all committees and the FIFA Congress (USD 32 million) and legal matters (USD 21 million). The for the exploitation of rights contractual obligations in relation to marketing, broadcasting and media rights as well as licensing. Financial expenses of were primarily made up of foreign exchange losses, which were offset by corresponding foreign exchange gains. 18

23 02 Overview 14 Income statement 16 Balance sheet 20 Budget comparison 22 Expenses 2012 USD million Football governance (5%) Committees and Congress 32 Total 53 Exploitation of rights (1%) Marketing 2 Total 13 Foreword 100% = USD 1,077 million Financial expenses (7%) 1 Total 77 69% for FIFA events and development Facts & Figures 2012 Other operating expenses (18%) Personnel 91 Total 188 Event-related expenses (53%) Total 569 Development-related expenses (16%) Goal Programme 29 Total Period Special Topics Annexe

24 Facts & Figures 2012 Balance sheet Balance sheet and development of reserves As at 31 December 2012, FIFA s balance sheet totalled, with reserves of. FIFA s reserves result from the previous years reserves of USD 1,293 million, the annual result of and the change in the hedging reserve of minus USD 4 million. FIFA s reserves have therefore in comparison to 31 December 2011, in accordance with a decision passed at the FIFA Congress in 2010 to only slightly increase reserves in the future. Furthermore, article 73 of the FIFA Statutes states that: The revenue and expenditure of FIFA shall be organised in such a way that they balance out FIFA s major duties in the future shall be guaranteed through the creation of reserves. magnitude. amount of reserves required cannot, in principle, be given as an absolute value, but rather depends on FIFA s overall costs and the associated operational risks during a four-year period. FIFA s current reserves correspond to approximately one-third of total costs for the period. and to its ability to react to unexpected events. This has proved particularly vital 20

25 02 Overview 14 Income statement 16 Balance sheet 20 Budget comparison 22 Balance sheet as at 31 December 2012 USD million Foreword Facts & Figures 2012 Development of reserves USD million 2012 result 89 Change in hedging reserve Period 1,500 1,350 1, ,378 1,200 1, Special Topics Annexe Dec Dec

26 Facts & Figures 2012 Budget comparison Analysis of revenue for 2012 FIFA s accounting system is based on International Financial Reporting. As IFRS is not suitable for budgeting and daily cost control on account of its many technical rules and regulations, the budget is drawn up on a cash basis before being approved by the Congress. A transition from IFRS is necessary in order to enable the actual revenue to be compared with the cash budget. Hence, from the total amount of revenue according to IFRS, an adjustment was made for the revenue that could not be included for a budget comparison. The resultant cash-in component was then compared with the budget. In order to carry out a budget comparison, in non-cash items had to be adjusted from the overall revenue of USD 1,166 million for the 2012 items consisted, in particular, of revenue in relation to the percentage-of-completion method, gross effects and value-in-kind revenue, which were not taken into account in the cash budget. The FIFA Congress passed a revenue budget of USD 676 million for the This extra revenue is mainly due to foreign currency effects, additional income from other FIFA events, brand licensing, and accelerated incoming payments. 22

27 02 Overview 14 Income statement 16 Balance sheet 20 Budget comparison 22 Revenue 2012: Components USD million 1,500 1,350 1,200 1, Foreword 1, Facts & Figures Total revenue Non-cash items Cash-in component Revenue 2012: Budget comparison USD million Period 1,500 1,350 1,200 1, Special Topics Cash-in component Budget 2012 (approved by FIFA Congress) Positive deviation (i.e. over budget) Annexe

28 Facts & Figures 2012 Budget comparison Analysis of expenses for 2012 The basic principle described for the analysis of revenue also applies to expenditure. A transition from IFRS is necessary in order to enable the actual expenses to be compared with the cash budget. Hence, from the total amount of expenses according to IFRS, an adjustment was made for the expenses that could not be included for a budget comparison. The resultant cash-out component was then compared with the budget. In order to carry out a budget comparison, in non-cash items had to be adjusted from the for the 2012 adjusted consisted primarily of expenses in relation to the percentage-of-completion method. The FIFA Congress passed an expense budget of USD 666 million for the 2012 underspent by. This underspend is mainly due to deferred costs for the 2014 FIFA World Cup Brazil and cost savings. 24

29 02 Overview 14 Income statement 16 Balance sheet 20 Budget comparison 22 Expenses 2012: Components USD million 1,500 1,350 Foreword 1,200 1,050 1, Facts & Figures 2012 Total expenses Non-cash items Cash-out component Expenses 2012: Budget comparison USD million Period 1,500 1,350 1,200 1, Special Topics Cash-out component Budget 2012 (approved by FIFA Congress) Positive deviation (i.e. under budget) Annexe

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31 Period Lionel Messi of Barcelona celebrates with team-mate Dani Alves after scoring his second goal during the between Santos and FC Barcelona at the International Stadium in Yokohama, Japan on 18 December 2011.

32 Period Detailed budget for 2014 Revenue and investments in 2014 The detailed budget for 2014 has been approved by the FIFA Finance Committee and the FIFA Executive Committee and it now requires from the. The detailed budget for 2014 was part of the overall budget approved by the 2010 Congress for the period, with the exception of the cost for the FIFA Club Protection Programme, which was approved by the 2012 FIFA Congress. 28

33 03 Detailed budget for Budget 2014: Revenue USD million 1,500 Foreword 1,200 1, Other (e.g. licensing, hospitality) Marketing rights TV broadcasting rights Facts & Figures 2012 Revenue 2014 Budget 2014: Investments USD million Period Development Financial Assistance Programme (FAP) - 54 member associations Goal Programme 34 New MA development programmes 32 PERFORMANCE 30 Technical development 19 Financial Assistance Programme (FAP) - 15 confederations Confederation development 15 programmes Refereeing Assistance Programme (RAP) 13 Football for Hope 12 Other (e.g. solidarity projects, 3 Football for Health) Committees and Congress 40 Transfer Matching System (TMS) 6 Early Warning System 2 Other (e.g. FIFA Brand) 19 1,500 1, , Investments 2014 Contributions to teams (prize money, 389 workshop, travel, lodging) TV production 165 FIFA Club Protection Programme, etc. 114 Financial contributions 53 FIFA Fan Fest 19 Insurance 10 Refereeing matters 9 Other (e.g. media, new media, inspections, 20 marketing, TV) FIFA Club World Cup 25 FIFA U-20 Women s World Cup 18 FIFA U-17 Women s World Cup 17 Youth Olympic Football Tournament 3 Other (e.g. FIFA Ballon d Or, FIFA Interactive 18 World Cup, Blue Stars/FIFA Youth Cup) Personnel, information technology, 162 building and maintenance Communications 29 Other (e.g. reception, logistics, production, 26 travel, translations, insurance, tax, Special Topics Annexe

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35 Special Topics 04 Brazil striker Marta vies with Cameroon striker Bebey Beyene during their group-stage match in the Women s Olympic Football Tournament London 2012 at the Millennium Stadium in Cardiff, Wales on 25 July.

36 Special Topics Good governance reforms Reform plan The four FIFA Task Forces, which were created in October 2011 as part of the reform process launched by the FIFA President during the 61 st FIFA Congress in Zurich, have all concluded their mandate to propose reforms. The proposals made by the Task Force Ethics Committee and the Task Force Transparency & Compliance, in particular with regard to the creation of the twochamber Ethics Committee and the Audit and Compliance Committee with independent chairmen and deputy chairmen, were approved by the 62 nd FIFA Congress in Budapest on 25 May At the same time, Domenico Scala (Italy/ Switzerland) was appointed as independent chairman of the Audit and Compliance Committee. Additionally, the new FIFA Code of Conduct appointment of a woman as a member of the FIFA Executive Committee, namely Lydia Nsekera (Burundi), were also approved that day. On 17 July 2012, based on a mandate given by the 62 nd FIFA Congress, the FIFA Executive Committee appointed Michael J. Garcia (USA) and Hans-Joachim Eckert (Germany) as independent chairmen of the Ethics Committee in addition to appointing the members of the Ethics Committee and adopting a new Code of Ethics. The Task Force Revision of Statutes presented a draft proposal of amendments to the FIFA Statutes and the remaining proposals which were not voted on at the Congress in 2012 will be presented to the FIFA Congress in In this context, the FIFA Executive Committee decided at its meeting on 27 and 28 September 2012 to create a working group, chaired by FIFA Executive Committee member and chairman of the Task Force Revision of Statutes Theo Zwanziger and comprising the general secretaries as well as the legal directors of the confederations and FIFA, in order to consult the 209 member associations on these amendments and submit the remaining proposals on the revision of the FIFA Statutes to the 63 rd FIFA Congress. The reform process will be completed by the 2013 FIFA Congress. 32

37 04 Good governance reforms 32 Asset management report 38 FIFA Club Protection Programme 40 Road map Key steps ExCo Structural set-up Transparency & Compliance, and Football 2014 Foreword Reform work Nov-Dec 2011 First Task Force meetings Compliance; analysis of situation and discussion of reform proposals ExCo Reform work January March 2012 Meetings of Task Forces and Independent Governance Committee recommendations for the Executive Committee Facts & Figures 2012 ExCo Approval of reforms Congress Approval and implementation of reforms to be split into two chambers, new Audit and Compliance Committee with independent chairman, independence criteria, Code of Conduct Period ExCo Ethics Committee, Code of Ethics (based on the mandate given by the FIFA Congress) Audit and Compliance Committee Aug and Oct 2012 Various reform proposals Member associations Nov 2012 Feb 2013 Consultation process on remaining reforms Transparency & Compliance (e.g. FIFA Organisation Regulations, General Regulations on FIFA Development Programmes) directors of the confederations, to consult the 209 member associations on further amendments to the FIFA Statutes Special Topics ExCo Approval of reforms Congress Completion of reform process Development Programmes judicial bodies, of the Audit and Compliance Committee and of the Representative of Annexe

38 Special Topics Good governance reforms Code of Ethics and Ethics Committee decision of the FIFA Congress to restructure the Ethics Committee by dividing it into two chambers, one investigatory and one adjudicatory, both with independent chairmen who were appointed by the Executive Committee in July Heading up the investigatory chamber is Michael J. Garcia, a leading US attorney who has led a wide range of prosecutions, including investigations into white-collar fraud and money laundering. Hans-Joachim Eckert, the German judge chosen to preside over the adjudicatory chamber. Currently serving as the experience, specialising in corruption, tax fraud and economic crime. The investigatory chamber is free to investigate all allegations of wrongdoing, including those related to past incidents, with no statute of limitations being imposed upon the investigators. 34

39 04 Good governance reforms 32 Asset management report 38 FIFA Club Protection Programme 40 FIFA Code of Ethics Foreword FIFA Code of Ethics 2012 edition Facts & Figures 2012 Composition Ethics Committee Period Chairmen Michael J. GARCIA USA (investigatory chamber) Hans-Joachim ECKERT Germany (adjudicatory chamber) Members investigatory chamber Les MURRAY Robert TORRES Jorge Iván PALACIO Noël LE GRAËT Ahmed YAHYA Ronald JONES Australia Guam Colombia France Mauritania Barbados Special Topics Members adjudicatory chamber Petrus DAMASEB Juan Pedro DAMIANI Abdoulaye Mokhtar DIOP Burton K. HAIMES Yngve HALLEN Thi My Dung NGUYEN Jack KARIKO Annexe 2012 Namibia Uruguay Senegal USA Norway Vietnam Papua New Guinea 35

40 Special Topics Good governance reforms Audit and Compliance Committee The Audit and Compliance Committee started its work in August 2012 and has met three times. The FIFA Congress elected Domenico Scala (Italy/Switzerland), as independent chairman of the committee. Domenico Scala studied at the University of Basel and graduated with a degree in Nobel Biocare Holding AG and CFO of Syngenta Holding AG. Today, he serves as a non-executive director of Basilea Pharmaceutica Ltd. He can draw on a wide range of business, senior leadership and multicultural experience. The main task of the Audit and Compliance Committee is to ensure the completeness and to review the and the external auditor s report. In addition, the Organisation Regulations. The responsibility of the committee is divided into three operations, and compliance. The Audit and Compliance Committee has accepted the 26 reform proposals prepared by the Task Force Transparency & Compliance, which mainly aim at improving control mechanisms and transparency throughout all of FIFA s core processes. The committee has discussed all of these proposals in detail and put forward corresponding changes to the FIFA Organisation Regulations, General Regulations for FIFA Development Programmes and other regulations, which will be examined by the Executive Committee. 36

41 04 Good governance reforms 32 Asset management report 38 FIFA Club Protection Programme 40 Composition Audit and Compliance Committee Chairman Domenico SCALA Italy/Switzerland Foreword Deputy chairman to be elected by the FIFA Congress in 2013 Members Allan HANSEN Rajesh PATEL Canover WATSON Richard K. LAI Romer OSUNA Suketu PATEL Denmark Fiji Cayman Islands Guam Bolivia Seychelles Facts & Figures 2012 Tasks Period Operations Financial reporting Compliance management and the internal control system the internal audit function to ensure that appropriate action is taken if shortcomings have been detected in internal reviews or procedures statements accounting standard (IFRS) statements are carried out properly subsidiaries with the law and the FIFA internal rules relating to compliance the laws and rules on ethics as well as with the FIFA internal rules applicable to them the Secretary General s monitoring of FIFA employees compliance with laws on ethics as well as with the FIFA internal rules applicable to them internal rules on compliance impact on FIFA by FIFA employees with the laws and rules on ethics as well as with the FIFA internal rules submitted by the body operating the whistle-blowing hotline for FIFA Special Topics Annexe

42 Special Topics Asset management report The overriding, long-term investment objective is the preservation of the real value of FIFA s assets. Returns must be in line with the market, in relation to the risk incurred. The investment portfolio is divided into a liquid part (investment periods of less than one year) and a bond part (investment periods of more than one year). needs, and secondly on the basis of the yield forecasts of the duration and credit- FIFA Asset Management Regulations. The year 2012 will also be remembered for volatile markets given the continuing Government bonds of the highest quality were issued with negative yield, i.e. the investor paid to hold these securities, e.g. Swiss and German government bonds; The overall yield level was very low again. The investment guidelines for the portfolio are designed to secure the preservation of FIFA s assets and therefore, the yield expectation in such an environment is rather low. However, due to a shortage of USD in the interbank market, FIFA was able to of the portfolio. The implementation of the benchmark continued as planned and will continue Overall, in 2012 FIFA again managed to increase the value of its portfolio and thereby contributed to the strengthening of its asset basis. 38

43 04 Good governance reforms 32 Asset management report 38 FIFA Club Protection Programme 40 Asset management strategy and current status 100 Foreword Strategy Range Facts & Figures Liquidity 100% = USD 1,877 million Period Details on current investment portfolio 13% Other banks/securities 27% Swiss cantonal bank deposits (with government guarantee) Special Topics 39% System-relevant banks 100% = USD 1,521 million 13% Government securities 8% Securities with government guarantee Annexe

44 Special Topics FIFA Club Protection Programme In May 2012, the 62 nd Congress in Budapest approved the FIFA Club Protection Programme on behalf of the member associations. The aim of this programme is to help FIFA, the confederations, member associations and clubs with their rights and obligations according to the FIFA Regulations on the Status and Transfer of Players, which state that clubs are obliged to release their players for senior men s representative A team matches on dates listed in the international match calendar. Under the FIFA Club Protection Programme, clubs will be compensated if their players are injured while on duty with senior men s representative A teams for matches listed in the international match calendar for the period between 1 September 2012 and 31 December During the release period for such international A matches, football players may suffer bodily injuries caused by accidents. As a consequence, a football player can suffer a temporary total disablement that prevents him from participating in his football club s matches. However, the football club still has an obligation to pay the football player s salary based on the employment contract. Since the football player cannot work for the football club during a temporary total disablement, FIFA has decided to provide compensation for the losses suffered by the football club during the period that the football player is temporarily totally disabled. foster the relationship between clubs and national teams. 40

45 04 Good governance reforms 32 Asset management report 38 FIFA Club Protection Programme 40 Key facts Programme provider Covered persons Covered risk Covered interest Covered matches Geographical limit Waiting period/excess Compensation amount FIFA Club Protection Programme FIFA Professional football club for which the injured player is contracted to play Professional football players whilst on international duty An injury which renders a player totally unable to carry out his profession on a temporary basis (temporary total disablement) Contracted salary payments from a club to a football player Cover applies to all selected players of senior men s A representative teams international match calendar Worldwide 28 days for each and every loss as his employer in weekly or monthly instalments, including mandatory social security charges, as stipulated in writing, but excluding any additional bonuses, appearance fees, expenses, performance payments and/or services of a different kind 20,548 per day 365 days Maximum amount per claim EUR 7,500,000 Terms and conditions FIFA Club Protection Programme Technical Bulletin available on FIFA.com Foreword Facts & Figures Period Annexe 2012 Special Topics 41

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47 Annexe Griedge Mbock Bathy of France heads the ball clear during the FIFA U-17 Women s World Cup between France and Korea DPR at the

48 Annexe 2012 according to International Financial

49 Auditor s report Foreword

50 Annexe

51 Auditor s report in TUSD ,018, ,044 FIFA World Cup expenses , , , , Exploitation of rights 10 Personnel expenses Taxes and duties 15 76,961 28,551 Financial expenses 14 88,882 35, Foreword 47

52 Annexe 2012 Consolidated balance sheet in TUSD Financial assets ,174,980 2,050, Intangible assets Financial assets , ,683 2,682,848 2,327,771 Payables 22 Tax liabilities 27 1,167, , , ,327 1,304,409 1,034,880 Association capital ,378,439 1,292,891 2,682,848 2,327,771 48

53 Auditor s report in TUSD Net result for the year Taxes and duties 15 Foreword Taxes and duties paid 218,480 53, , ,497 Interest paid , , ,071 1,609, ,125, ,071 49

54 Annexe 2012 in TUSD 4,104 26,338 1,249, ,280, , ,207 Net result for the year ,259 35, ,755 4,104 3,079 1,285, ,292,891 in TUSD 4,104 3,079 1,285, ,292, , ,334 Net result for the year ,354 88, ,548 4, ,374, ,378,439 50

55 Auditor s report in TUSD ,334 23,207 Net result for the year 85,548 12,755 Foreword 51

56 Annexe 2012 Notes to the consolidated Accounting policies A B Basis of presentation 52

57 Auditor s report Foreword C Basis of consolidation D Foreign currency 53

58 Annexe 2012 CHF EUR GBP E F Marketing rights Licensing rights Hospitality rights 54

59 Auditor s report Foreword 55

60 Annexe 2012 G H F Goal I 56

61 Auditor s report Foreword K Taxes and duties L C 57

62 Annexe 2012 M N Hedging 58

63 Auditor s report O Foreword P Q Intangible assets 10 years 59

64 Annexe 2012 R 60

65 Auditor s report S Foreword T U 61

66 Annexe 2012 V W 62

67 Auditor s report X Foreword Y 63

68 Annexe 2012 Notes to the consolidated income statement 1 Revenue from television broadcasting rights in TUSD Revenue from television broadcasting rights FIFA World Cup Europe 287, ,144 Asia and North Africa 126, ,054 South and Central America 83,025 83,025 North America and the Caribbean 61,229 61,159 Rest of the world 6,498 9,909 Other revenues Sales commission 12,090 5,939 Total revenue from television broadcasting rights FIFA World Cup 553, ,728 Other FIFA events 7,455 13,558 Total revenue from television broadcasting rights 560, ,286 The accumulated revenue from television broadcasting rights recognised through the percentage-ofcompletion method (excluding hedge accounting effects, other revenues and sales commission) for the A substantial part of the income from television broadcasting rights is denominated in EUR. The majority of the contractually agreed revenue in currencies other than USD is hedged. The revenue is increased by Sales commission The broadcasting rights in certain countries, especially in Asia, are sold in cooperation with agencies. Other FIFA events The revenue from the television broadcasting rights for other FIFA events includes the revenue from the sale of television broadcasting rights and services offered to the broadcasters in connection with the FIFA U-17 Women s World Cup Azerbaijan 2012, the FIFA U-20 Women s World Cup Japan 2012 and the FIFA Futsal World Cup Thailand

69 Auditor s report Revenue from marketing rights in TUSD Revenue from marketing rights FIFA World Cup FIFA Partners 177, ,125 FIFA World Cup Sponsors 130, ,787 National Supporters 43,327 28,590 FIFA Fan Fest 6,981 0 Value-in-kind transactions 12,775 14,983 Sales commission 4,015 3,579 Total revenue from marketing rights FIFA World Cup 366, ,906 Other FIFA events 3,353 33,339 Total revenue from marketing rights 370, ,245 The accumulated revenue recognised through the percentage-of-completion method (excluding hedge invoiced from marketing rights amounts to TUSD 785,727. Foreword Other FIFA events The revenue from other FIFA events includes National Supporter payments in connection with the FIFA U-17 Women s World Cup Azerbaijan 2012, the FIFA U-20 Women s World Cup Japan 2012 and the FIFA Futsal World Cup Thailand The majority of these payments are transferred to the Local Organising Committees. The relevant costs are shown as event-related expenses (Note 6). 65

70 Annexe Revenue from licensing rights in TUSD FIFA World Cup 18,141 10,231 Other FIFA events 5,253 2,244 Sales commission Total revenue from licensing rights 23,061 12,475 The accumulated revenue from licensing rights for the 2014 FIFA World Cup Brazil recognised for the period 1 January 2011 to 31 December 2012 amounts to TUSD 28,372. The accumulated amount invoiced by 31 December 2012 totals TUSD 33, Revenue from hospitality rights in TUSD FIFA World Cup 12,000 15,000 Other FIFA events Total revenue from hospitality rights 12,000 15,111 The hospitality rights for the 2014 FIFA World Cup Brazil have been granted to MATCH Hospitality AG 5 Other event-related revenue in TUSD Revenue from the FIFA Club World Cup 25,400 26,000 Revenue from the Olympic Football Tournaments London , ,481 1,849 2,499 2,062 Various event-related revenue Total other event-related revenue 52,605 28,927 FIFA organised the Olympic Football Tournaments London FIFA received a contribution of TUSD 22,412 from the International Olympic Committee. 66

71 Auditor s report Event-related expenses in TUSD FIFA World Cup 448, ,944 FIFA Club Protection Programme 18,368 0 Other FIFA events 103, ,658 Total event-related expenses 569, ,602 Foreword Expenses related to the 2014 FIFA World Cup in TUSD ,159 10,823 Contributions to the LOC 35,591 58,050 Ticketing and accommodation services/it solution 14,960 23,046 Event marketing rights and TV production 35,968 23,975 Other 20,105 11,187 Event-related expenses accrued 330, ,863 Total expenses related to the 2014 FIFA World Cup 448, ,944 The accumulated expenses recognised in connection with the 2014 FIFA World Cup Brazil in the period 1 January 2011 to 31 December 2012 amount to USD million. The accumulated expenses incurred up to 31 December 2012 amount to USD million. Part of the expenses are incurred as value-in-kind transactions. Organising Committee Accounting estimates and judgments Expenses related to the 2014 FIFA World Cup Brazil are recognised based on the stage of completion of the event preparation. Event-related expenses for the whole four-year period must be estimated in order to calculate the total for the given stage of completion. This is achieved by regular, systematic estimate for the event. The recognition of expenses is adjusted accordingly. However, the overall cost estimate at a certain stage inherently includes an estimation uncertainty. 67

72 Annexe 2012 FIFA Club Protection Programme Under the FIFA Club Protection Programme, clubs will be compensated for injuries due to an accident sustained by their players while on duty with senior men s representative A teams for matches on dates listed in the international match calendar for the period between 1 September 2012 and 31 December FIFA has decided to provide compensation up to a maximum amount for losses incurred by the football club during the period that the football player is temporarily totally disabled. Costs for the FIFA Club Protection Programme are costs for FIFA and are recognised in the year they are incurred. Expenses related to other FIFA events in TUSD FIFA Club World Cup Japan ,015 0 FIFA U-20 Women's World Cup Japan ,315 0 FIFA U-17 Women's World Cup Azerbaijan ,161 0 Olympic Football Tournaments London ,442 0 FIFA Futsal World Cup Thailand ,654 0 FIFA Women s World Cup Germany ,385 FIFA Club World Cup Japan ,538 FIFA U-20 World Cup Colombia ,166 FIFA U-17 World Cup Mexico ,981 FIFA Beach Soccer World Cup Ravenna/Italy , FIFA World Cup South Africa 424 3,667 Youth Olympic Football Tournaments Singapore FIFA U-17 Women s World Cup Trinidad & Tobago FIFA U-20 Women s World Cup Germany FIFA Club World Cup UAE Blue Stars/FIFA Youth Cup 1,289 1,423 Other events 11,506 11,753 Total expenses related to other FIFA events 103, ,658 The expenses for the other FIFA events are recognised in the year when the event takes place. The of the expenses are incurred as value-in-kind transactions. Costs related to the FIFA U-17 Women s World Cup Azerbaijan 2012, the FIFA U-20 Women s World Cup Japan 2012 and the FIFA Futsal World Cup Thailand 2012 include payments from National Supporters which were transferred to the Local Organising Committees (see also Note 2). 68

73 Auditor s report Other operating income in TUSD Quality Programme 12,794 14,637 3,142 3,177 Brand licensing 34,067 25,556 Penalties/appeals from friendly matches Rental income 1,013 1,380 Match levies from friendly matches 4,259 3,841 Other 3,557 3,724 Total other operating income 58,846 52,356 Quality Programme contains the revenue in connection with the test programmes for footballs and football turf. Brand licensing relates to licences granted to use the brand FIFA. Foreword 8 Development-related expenses in TUSD Financial Assistance Programme (FAP) member associations 53,003 53,218 Financial Assistance Programme (FAP) confederations 15,000 17,500 Confederation development programmes 15,000 15,000 Goal Programme 28,672 30,687 PERFORMANCE 17,772 9,218 Football for Hope 8,770 5,613 Refereeing Assistance Programme (RAP) 8,336 10,218 Football for Health (F-MARC) 5,804 3,293 Education 5,317 5,429 Women s football 3,195 4,261 Solidarity projects 2,211 6,300 Win in... projects Win in Africa with Africa 14 6 Other projects 14,295 22,157 Total development-related expenses 177, ,900 69

74 Annexe 2012 FAP technical infrastructure (see accounting policy H. Development-related expenses). FIFA grants this Facilitate the recruitment, training and remuneration of administrative and technical staff employed Provide basic and further training for member association members, as well as others seconded to every year. Additionally, FIFA arranges a central audit of 21 member associations and one confederation compliance with the FAP Regulations. USD 18.6 million). Confederation development programmes USD 2.5 million per year. The use of these funds must be in compliance with the FAP Regulations. In addition, this programme is also subject to local and central audits as described above. Goal Programme Goal Goal offers funding for tailor-made projects to meet the individual needs of the member associations in the following Youth football training youth team coaches, regional and national youth training centres and Infrastructure the renovation and construction of football pitches, physical training and tuition 70

75 Auditor s report , funds committed but not yet paid out to Goal PERFORMANCE The main objective of the programme is to strengthen and enhance football leadership and management systems, enabling the member associations to better organise, professionalise and commercialise their Foreword Refereeing Assistance Programme (RAP) The Refereeing Assistance Programme includes several programmes to support the education of referees, for example through various seminars and courses. Solidarity projects the condition that they invested in youth football. In addition, FIFA granted USD 300,000 to the member association of Madagascar for renovation of their football pitches. Football for Hope Football for Hope is a social responsibility programme which uses the power of the game for social development. Part of Football for Hope is the 20 Centres for 2010 initiative related to the 2010 FIFA World Cup South Africa. Its aim is to create 20 Football for Hope Centres to promote public health, education and football in disadvantaged communities across Africa. Education FIFA supports the International Centre for Sports Studies (CIES) at the University of Neuchâtel and the Women s football In 2012, various courses and seminars were organised to improve the game. Football for Health (F-MARC) control and the FIFA 11 for Health programme. 71

76 Annexe Football governance in TUSD Committees and Congress 32,089 31,067 Legal matters 20,608 20,826 Total football governance 52,697 51,893 The costs for committees and the Congress comprise the costs incurred in connection with the 62 nd FIFA Congress in Budapest which took place in May 2012, plus the costs of the meetings of more than 25 standing committees and three FIFA judicial bodies (Disciplinary Committee, Appeal Committee and Ethics Committee). The cost for travel and accommodation of the committee members as well as of the are paid by FIFA. 10 Exploitation of rights in TUSD Marketing 1,920 2,593 Broadcasting and media rights 9,445 10,249 Licensing 1,655 2,332 Total exploitation of rights 13,020 15,174 commercialisation of marketing and broadcasting rights. 72

77 Auditor s report Personnel expenses in TUSD Wages and salaries 70,799 67,344 13,940 13,789 1,630 1,918 Other 4,280 5,886 Total personnel expenses 90,649 88,937 Foreword The pension plan for FIFA employees is funded by employee and employer contributions. Since the plan in TUSD ,594 87,370 Current service cost 11,444 11,046 Interest on obligations 2,342 2,378 Actuarial loss 14,359 5, ,680 Foreign exchange effect 3, , ,594 73

78 Annexe 2012 Change in fair value of plan assets in TUSD Fair value of plan assets at beginning of year 91,772 81,064 Expected return on plan assets 2,213 2,334 Employer contribution 6,346 7,382 Employees contribution 2,455 2, ,680 Actuarial gain on plan assets 1, Foreign exchange effect 3, Fair value of plan assets at end of year 107,099 91,772 The actual annual return on plan assets for the year ending 31 December 2012 amounted to TUSD 3,821 Amount recognised in the balance sheet in TUSD , ,594 Fair value of plan assets 107,099 91,772 28,092 11,822 Unrecognised net actuarial (loss)/gain 24,113 10,746 Net liability 3,979 1,076 The net liability is included in and presented as part of the accrued expenses. The expected contribution to be paid into the plan for 2013 is TUSD 6,

79 Auditor s report Components of pension expenses in TUSD Current service cost 11,444 11,046 Interest on obligations 2,342 2,378 Net actuarial loss recognised in the year 29 0 Expected return on plan assets 2,213 2,334 Net periodic pension cost 11,602 11,090 Employees contribution 2,455 2,578 Total pension expenses 9,147 8,512 Foreword Historical information in TUSD , ,594 87,370 64,414 55,225 Fair value of plan assets 107,099 91,772 81,064 65,324 56,206 plan 28,092 11,822 6, Change in assumptions in plan liabilities 13,662 4,270 5,091 2,415 4,977 Experience loss on plan liabilities 1,057 1, , Experience loss/(gain) on plan assets 1, (gain) 13,071 4,418 5, ,447 75

80 Annexe 2012 Principal actuarial assumptions 31 Dec Dec 2011 Discount rate 1.75% 2.25% Expected rate of return on plan assets 1.90% 2.40% Future salary increases 2.00% 2.00% Future pension increases 0.50% 0.50% All assets are invested through an insurance contract, therefore the plan assets cannot be split into different categories. Accounting estimates and judgments The rates and parameters applied above are based on past experiences. Future developments in capital calculation of pension obligations. 12 Other operating expenses in TUSD Information technology 9,183 9,750 Building and maintenance 12,144 10,045 Communications 23,532 22,277 Other 20,486 24,223 Total other operating expenses 65,345 66,295 76

81 Auditor s report Financial income in TUSD ,558 6,046 Total interest income 6,558 6,046 Foreword Foreign currency gains 76,521 20,200 Gains on currency derivatives 0 1,509 Total foreign currency gains 76,521 21, Income from held-to-maturity investments 5,158 1,809 5,740 2,086 88,819 29,841 held in foreign currency. The foreign exchange risk of these investments has been hedged using swaps. 14 Financial expenses in TUSD Interest expenses Total interest expenses Foreign currency loss 76,335 21,998 Total foreign currency loss 76,335 21,998 76,898 22,430 77

82 Annexe Taxes and duties in TUSD Taxes and duties 17,052 4,866 Total taxes and duties 17,052 4,866 FIFA is taxed according to the Swiss taxation rules for associations. Pursuant to these taxation rules, the development of football, the long-term perspective of development projects, the four-year accounting also Note 26 Financial risk management). FIFA s restricted reserves are reviewed on a regular basis to reserves. FIFA s subsidiaries are taxed based on the applicable local tax laws. This position includes all non-recoverable taxes and duties borne by FIFA or its subsidiaries. The majority of taxes and duties are paid to tax authorities in Switzerland. There are no tax loss carry-forwards. 78

83 Auditor s report Notes to the consolidated balance sheet 16 in TUSD 31 Dec 2012 Weighted average interest rate 31 Dec 2011 Weighted average interest rate Cash on hand, post and bank accounts 847, ,521 with maturities of up to 3 months 278, ,550 Total cash and cash equivalents 1,125, % 859, % A bank account in the amount of is pledged to cover a bank guarantee towards a third party. Foreword 17 Receivables in TUSD 31 Dec Dec 2011 Receivables from exploitation of rights Due from third parties 244, ,100 Provisions for bad debts 2,295 3,372 Total receivables from exploitation of rights 242, ,728 Other receivables Due from member associations and confederations 11,866 8,281 Due from related parties Due from third parties 22,495 29,900 Provisions for bad debts 1,585 0 Total other receivables 32,984 38,483 Short-term loans Due from related parties 0 5,175 Total short-term loans 0 5,175 Total receivables, net 275, ,386 The majority of the open receivables relates to contractual payments from broadcasters and sponsors for the 2014 FIFA World Cup which are due in January

84 Annexe 2012 Provisions for bad debts in TUSD Provisions for bad debts Balance as at 1 January 3,372 3,101 Use Additions Foreign exchange effect 3 0 Balance as at 31 December 3,880 3,372 Ageing structure of receivables in TUSD 31 Dec Dec 2011 Receivables Not due 264, ,680 Overdue less than 30 days 2,781 13,204 Overdue less than 60 days 7, Overdue more than 60 days 4,667 5,621 Total receivables 279, , Prepaid expenses and accrued income in TUSD Note 31 Dec Dec 2011 Accrued income 2014 FIFA World Cup , ,716 Other FIFA events 1 5 5,400 6,000 Other accrued income 9,400 1,580 Total accrued income 254, ,296 Prepaid expenses 2018 FIFA World Cup 21,750 0 Other FIFA events 6 14,600 10,609 Development programmes 8 3,068 2,565 Other prepaid expenses 9,441 6,953 Total prepaid expenses 48,859 20,127 Total prepaid expenses and accrued income 303, ,423 80