FINANCIAL INFORMATION

• Rehab Group Finance
• 2008 Financial Statements

Rehab Group Finance

In 2008, the Rehab Group reported an operating surplus of €2.1 million, representing 1 per cent of turnover which grew by 5 per cent to €216 million during the year due to some new care services coming on-stream and an increase in commercial activity. However, this growth declined in the second half of the year as the economic downturn began to affect funders and customers, and significant challenges are anticipated in 2009. Net borrowings at the end of the year stood at €3 million, in line with the previous year, and the cost of servicing debt was €750,000.

The Rehab Group has adopted Financial Reporting Standard 17 on retirement benefits. In 2008, the liability in respect of the defined benefit pension scheme increased by €18.7 million to €30.9 million. This was the result of the downturn in global equity markets having a serious impact on the scheme, a common feature among many similar schemes in other organisations. Steps are being taken in 2009 to address this significant deficit.

Turnover in the UK services grew by 4 per cent due, in the main, to the inclusion of a full year’s activity for St Andrew’s Homecare in Scotland, which was acquired in 2007, while TBG Learning continued to perform well.

The drop in the €/£Stg exchange rate during the year also had a detrimental effect on the organisation’s reserves of €2.1 million and this, combined with the increase in the defined pension scheme liability, reduced net assets to €40.4 million.

The Board and management of the Rehab Group are committed to maintaining a high standard of corporate governance. The internal audit function is now well established and the Board’s Audit Committee, chaired by Mr Liam Hogan, oversaw the work plan for 2008 and formally approved the work plan for 2009.

As a not-for-profit organisation, resources are committed to services for people with disabilities and other socially-disadvantaged groups. With over 3,500 staff and more than 56,000 people and their families benefitting from the supports provided by the Rehab Group each year, the organisation needs to create and hold reserves to support itself as an independent, viable undertaking.

While it is the Rehab Group’s aim that its core services should be self-financing, some services are currently operating with deficits; in addition, the organisation continues to invest in a capital programme.

Historically, the Rehab Group developed ancillary activities such as pools, lotteries and fundraising activities to ensure that these deficits are covered, contribute income to the capital programme and allow for unfunded innovation in certain service areas.

During the year, capital expenditure accounted for €12.6 million which was funded in part by way of capital grants from various agencies, from fundraising and from borrowings. The Rehab Group continues to look at different ways of raising funds and consolidated its online lottery activity in 2008. Fundraising operates in a very competitive arena and most of the Rehab Group’s fundraising is now event-driven rather than through traditional donations.

The Rehab Group acknowledges with gratitude the contribution by the public authorities both in Ireland and in the UK to the development of its services.

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The Rehab Group (Extracts from Consolidated Financial Statements)

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