22
ANNUAL REPORT 2014
ANNUAL REPORT 2014
MA
DE IN
NEW
ZEALAND © Recorded Music New Zealand Limited. P Recorded M
usic
New
Zea
land
Lim
ited.
WE LOVE MUSIC(R.Music) 3:30
SIDE ASTEREO
© 2015 Recorded Music New Zealand Limited. This Annual Report contains proprietary information and is provided for informational purposes only. Please do not use any information contained in it unless expressly authorised to do so
by Recorded Music New Zealand Limited.‘Recorded Music NZ’; ‘NZ Music Awards’ and the Tui device;
‘The Official NZ Music Charts’; ‘ProMusic’; and ‘NZ Music Hall of Fame’ are registered trademarks.
Chris Caddick, ChairmanDated 25.03.15
Adam Holt, DirectorDated 25.03.15
RECORDED MUSIC NEW ZEALAND LIMITED
Annual Report for the year ended 31 December 2014
CONTENTS
5 Chairman’s Report
7 Chief Executive’s Report
9 2014 Year in Review
10 Revenue Summary 2014
11 ProMusic & WeCreate Report
12 Tied To The Tracks
12 NZ Music Hall of Fame
Financial Statements:
13 Directory
14 Statement of Financial Position
15 Statement of Financial Performance
16 Statement of Funds Movement
17 Notes to the Financial Statements
19 Auditor’s Report
The directors are pleased to present the Annual Report and Financial Statements of
Recorded Music New Zealand Limited for the year ended 31 December 2014.
For and on behalf of the Board of Directors
3
Annual Report 2014
LORDELorde once again dominated the musical landscape, backing up her 2013 VNZMA haul with another 6 Tuis for Album of the Year, International Achievement, Best Female Solo Artist, Single of the Year, Highest Selling Single and Best Pop Album. Collaborator Joel Little also received the Best Producer & Best Engineer awards.
Globally, Lorde’s track ‘Yellow Flicker Beat’ was the feature song on The Hunger Games soundtrack, which she performed at the MTV Awards. Lorde also performed at the Rock & Roll Hall of Fame induction for Nirvana alongside band members Dave Grohl & Kris Novoselic and music luminaries such as Joan Jett and Kim Gordon.
Photo: Topic Photography
4
55
CHAIRMAN’S REPORT
The first full year of the newly created Recorded Music New Zealand has been a
memorable one.
Results have once again been outstanding, with all major markers in the Strategic
Plan having been met.
The OneMusic initiative is working well and contributed to record payouts to artists
and record labels.
In the creative industries sector, Recorded Music New Zealand has taken a leadership
role in establishing WeCreate. This new committee will provide a more coherent
voice to Government in addition to providing annual sector valuation.
An exceptional Vodafone New Zealand Music Awards event in November was the
icing on the cake.
The Board thanks Damian, Kristin and the team at Recorded Music New Zealand for
their calm dedication and hard work, and looks forward to another great year in 2015.
Chris Caddick
Chairman, Recorded Music NZ
6
Pictured: Nick Atkinson, Karl Steven, Joe Loni, Che Fu. Photo: Topic Photography
SUPERGROOVESupergroove proved to be an extremely popular choice as recipient of the 2014 Legacy
Award and induction into the NZ Music Hall of Fame. Super-Sista-Groove (Hollie Smith,
Ria Hall, Iva Lamkum & Tali) performed “Can’t Get Enough” peppered with medleys of
other Supergroove tunes at the NZ Music Awards presentation.
6
7
CHIEF EXECUTIVE’S REPORT
2014 was our first full year as Recorded Music NZ representing the recording industry in NZ. It was a year of growth for our organisation and one of continued transition and revenue diversity for record companies and recording artists in NZ.
We have now completed our first year of our 3 year plan and I can report that we have delivered positive results across our three strategic focuses: Maximising our collective licensing revenue, delivering world class services to our membership and protecting and promoting music via our ProMusic activities.
I am also very pleased to report that we exceeded our revenue expectations significantly in 2014 and for the first time ever we will distribute $10m+ in royalties to members. It has been an exceptional year and I want to thank the Recorded Music NZ team for achieving such a fantastic result.
Highlights from the 2014 year and focus for 2015
Member Services• 2014 produced a distributable income to members of $10m+ (for distribution in 2015) which is the first time we have reached double digits; an increase of 15% on the previous year (see page 10). This is a phenomenal achievement of which we are enormously proud.• The current number of NZ recording artists now registered in the Direct- to-Artist royalty scheme is 1956. This is a 14% increase on membership since December 2013 (234 new registered NZ recording artists).• The 49th annual Vodafone New Zealand Music Awards were held on Thursday 20th November 2014 at Auckland’s Vector Arena. o 2014 saw performances by David Dallas, Broods, Tiny Ruins, Blacklistt, Benny Tipene, Sol3 Mio and a very special tribute performance to Supergroove by Hollie Smith, Ria Hall, Iva Lamkum, Tali and The Levites. o Lorde won album of the year for her phenomenal album ‘Pure Heroine’ and also single of the year for ‘Team’. o Supergroove received the 2014 NZ Herald Legacy Award and were inducted into the NZ Music Hall of Fame. o Broadcast live for the first time in over a decade by FOUR the 2014 VNZMA Awards Show achieved its highest ratings ever on the network.• We continued our Recorded Music NZ Music Grants programme and recipients in 2014 included: The NZ Music Foundation, The MMF, Auckland University, StudioLink, IMNZ, Smokefree Pacifica Beats, AudioCulture and Sounz.• In 2014 we updated and modernised the Official NZ Music Charts and the singles charts now include on-demand streaming as well as sales data. The Charts are also available as playlists on Spotify and iHeart Radio digitally.• Over a 2 year period record labels large and small - with assistance from Recorded Music New Zealand – have worked to digitally re-issue more than 400 NZ artist albums which we celebrated at our ‘Tied to the Tracks’ event in May 2014. Some of the uncovered albums now available digitally preceded even CD’s and cassettes and were only ever available on vinyl. Our thanks to Chris Caddick who is spearheading this fantastic project and it will continue as an on-going programme into 2015 and beyond.
7
2014 a year of diversity and growth
8
• In 2015 we will implement our new data system which will improve the delivery of market information and insight to rights holders. We will launch a testing phase in consultation with membership in April. We will also evaluate a number of trial data services to improve our data collection across the TV and Public Performance areas.• This year is the 50th anniversary of the NZ Music Awards and we will be celebrating this historic milestone in the lead up to this year’s awards in November.• This year is also the 40th anniversary of the Official NZ Music Charts and we will be acknowledging that landmark in May of this year. Celebrating the music that has been popular with Kiwis over the last 40 years.
Revenue• Over the 2014 year collective licensing from public performance, communication, broadcast and other sources generated $12.9m in revenue which was an increase of 11.7% on the preceding year. We experienced growth across the board from our three key revenue areas; radio, TV and public performance as well as a handful of smaller areas.• We have now completed one full year of our joint public performance licensing initiative with APRA: OneMusic. We are pleased to report that OneMusic has been successful on many levels, extending the joint licence from simple public performance into areas of education, schools, universities, other tertiary, airlines and all aspects of where recorded music is used in public. OneMusic is seen as a more modern, customer focussed and responsive music licensing solution and is a platform for revenue growth for both our members: recording artists and record companies but also APRA’s members: songwriters, composers and music publishers.• We also managed to conclude a number of our TV broadcaster negotiations which will return higher and more ‘reflective of use’ royalty returns to our members long term.• Radio continues to perform very well despite increasing competition in the digital area and the increasing media spread of advertising dollars. • Whilst still in their infancy webcasting services in NZ have also managed to thrive in 2014 and we expect this to continue into 2015.
My thanks to the Recorded Music NZ Board and the various committees, and a special thank you to the Recorded Music NZ staff for such an exceptional year.
Damian VaughanCEO Recorded Music NZ
Lorde Pure Heroine(Universal Music)Album of the Year, Best Female Solo Artist,Best Pop Album, Best Producer, Best Engineer
8
OneMusicHospitality industry advertising
9
2014 YEAR IN REVIEW
2014 TOP SELLING SINGLES
ARTIST TITLE LABEL GROUP / DIST.
1 PHARRELL WILLIAMS HAPPY COLUMBIA SONY
2 MEGHAN TRAINOR ALL ABOUT THAT EPIC SONY
3 TAYLOR SWIFT SHAKE IT OFF BIG MACHINE UNIVERSAL
4 JOHN LEGEND ALL OF ME SONY SONY
5 SAM SMITH STAY WITH ME CAPITOL UNIVERSAL
6 ED SHEERAN I SEE FIRE DECCA UNIVERSAL
7 ED SHEERAN THINKING OUT LOUD ASYLUM WARNER
8 A GREAT BIG WORLD SAY SOMETHING EPIC SONY
9 THE MADDEN BROTHERS WE ARE DONE CAPITOL UNIVERSAL
10 MAGIC! RUDE SONY SONY
2014 TOP SELLING ALBUMS
ARTIST TITLE LABEL GROUP / DIST.
1 ED SHEERAN X ASYLUM WARNER
2 SOL3 MIO SOL3MIO UNIVERSAL UNIVERSAL
3 TAYLOR SWIFT 1989 BIG MACHINE UNIVERSAL
4 SAM SMITH IN THE LONELY HOUR CAPITOL UNIVERSAL
5 MICHAEL BUBLE CHRISTMAS WARNER WARNER
6 VARIOUS FROZEN: THE SONGS DISNEY UNIVERSAL
7 LORDE PURE HEROINE UNIVERSAL UNIVERSAL
8 PINK FLOYD THE ENDLESS RIVER COLUMBIA SONY
9 COLDPLAY GHOST STORIES PARLOPHONE WARNER
10 DEVILSKIN WE RISE DEVILSKIN RHYTHMETHOD
2014 TOP SELLING NEW ZEALAND ALBUMS
ARTIST TITLE LABEL GROUP / DIST.
1 SOL3 MIO SOL3 MIO UNIVERSAL UNIVERSAL
2 LORDE PURE HEROINE UNIVERSAL UNIVERSAL
3 DEVILSKIN WE RISE DEVILSKIN WARNER
4 BROODS EVERGREEN DRYDEN ST UNIVERSAL
5 SHIHAD FVEY WARNER WARNER
6 BROODS BROODS EP DRYDEN ST UNIVERSAL
7 WHENUA PATUWAI THE SOUL SESSIONS SONY SONY
8 TIM BEVERIDGE CHRISTMAS IS TIM BEVERIDGE -
9 SHARON O’NEILL WORDS: THE VERY BEST OF SONY SONY
10 TEMUERA MORRISON TEM SONY SONY
In 2014 it is clear that income sources are now more diversified than ever with four almost equal income sources: physical product, downloads, streaming, public performance and broadcast. Overall, in 2014 the NZ Recorded Music industry saw a slight decrease of just 0.8% per cent in annual recorded music revenues.
Public awareness and uptake of streaming services within NZ has grown significantly over the last 12 months and this rapid growth now represents 24% ($12.7m) of all recorded music wholesale revenues by format which is more than a 250% increase on 2013.
On the whole, digital music services (streaming and downloads) are the number one source of revenue for rights owners accounting for 60 per cent of all music sales by format, leaving physical music products accounting for the remaining 40 per cent of the market.
Physical products remain very important revenue streams to the industry accounting for $21.4million of all revenues. A special point of interest is that Vinyl sales have experienced a massive resurgence in popularity in recent years, up more than 200 per cent on 2013 making up slightly more than $1m of revenue by format.
This diversification of revenue sources reflects the diversification of audiences and the way they consume music in NZ. We really are spoilt for choice when it comes to our options in NZ and our artists have the ability now to reach their fans in a more meaningful and targeted way. Making it even more important than ever for record companies and recording artists to understand who their audience is, where they are and how they are consuming music.
Damian Vaughan, CEO, Recorded Music NZ
2014 TOP SELLING NEW ZEALAND SINGLES
ARTIST TITLE LABEL GROUP / DIST.
1 TIMMY TRUMPET & SAVAGE FREAKS MINISTRY OF SOUND UNIVERSAL
2 GINNY BLACKMORE & STAN WALKER HOLDING YOU SONY SONY
3 BROODS BRIDGES DRYDEN ST UNIVERSAL
4 LORDE YELLOW FLICKER BEAT REPUBLIC UNIVERSAL
5 LORDE ROYALS UNIVERSAL UNIVERSAL
6 BROODS MOTHER & FATHER DRYDEN ST UNIVERSAL
7 LORDE TEAM UNIVERSAL UNIVERSAL
8 SIX60 SPECIAL MASSIVE UNIVERSAL
9 BENNY TIPENE MAKE YOU MINE SONY SONY
10 DAVID DALLAS FEAT. RUBY FROST THE WIRE DIRTY UNIVERSAL
Ph
oto
s su
pp
lied
9
PharrellTop selling single
Sol3 MioTop selling NZ album
Ed SheeranTop selling album
Timmy Trumpet & SavageTop selling NZ single
10
REVENUE SUMMARY 2014
10
WHOLESALE REVENUES REVENUE BY FORMAT TYPE
2014
2013
2012
PHYSICAL & DIGITAL REVENUES
DISTRIBUTED TO MEMBERSPUBLIC PERFORMANCE & COMMUNICATION REVENUES
2012 20142013
($ M
ILL
ION
S)
$35.5 $27.1
$21.4
$23.7
$23.0
$19.1
$1.8
$5.0
$12.7
$11.2
$11.6 $13.0
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
2012 2013 2014
PHYSICAL DOWNLOADS STREAMING PUBLIC PERFORMANCE & BROADCAST
$35.5
$27.1 $21.4
$25.5
$27.9
$31.8
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
2012 2013 2014
DIGITAL
PHYSICAL
$6.3 $6.7 $7.3
$1.5 $1.4 $1.8
$2.8 $2.8
$3.1 $0.6 $0.6
$1.0
$0
$2
$4
$6
$8
$10
$12
$14
2012 2013 2014
Mill
ion
s
Other
Public Performance
TV
Radio
55%
14%
23%
8%
PHYSICAL 58%
DOWNLOADS 39%
STREAMING 3%
PHYSICAL 49% DOWNLOADS
42%
STREAMING
9%
PHYSICAL 40%
DOWNLOADS 36%
STREAMING 24%
11
PROMUSIC REPORT
Kristin BowmanGeneral Counsel & Government Affairs, Recorded Music NZ
The promusic.co.nz website has continued to be our hub to provide quick and easy access to all the online services and physical stores where recording artists and their labels get paid for their work. Over the past year, even more online services have become available to music consumers and we now have a wide range of options and models available at reasonable prices.
There is no excuse for using services which do not pay artists and we continue to educate and encourage music consumers to make the right choice. One aspect of our activities in this area is what is known as the graduated response programme. While this programme can involve hearings before the Copyright Tribunal for accessing music through illegal peer-to-peer file sharing sites, a large part of the programme focusses on education notices to those accessing illegal content. These notices clearly outline all the ways music can be found and enjoyed legally and help explain the many reasons why legal services should be used.
Over the year this programme has coincided with a reduction in the use of peer-to-peer file sharing sites in New Zealand, however we continue to look at all the options that are available to us to protect the rights of our artists and labels. One such option would be seeking the assistance of the High Court to restrict access to illegal sites, as is currently done in at least 18 other countries throughout the world.
Alongside these activities of promoting and protecting the work of recording artists and their labels, we continue to engage with Government across a number of ministries to ensure music, and what it provides as a contributor to New Zealand’s economy, is understood and appreciated. This is an ongoing programme and underpins much of the work we do.
We are confident New Zealand music consumers will continue to not only become more familiar with the many legal ways now available to find and enjoy music - but increasingly see them as the easy and right choice.
WECREATEWe have been very happy to have been a part of the launch of WeCreate in 2014.WeCreate is the unified voice of the creative sector in New Zealand whose vision is to grow New Zealand’s creative sector, locally and internationally. Member organisations are unashamedly in the business of creativity in the areas of TV, film, books, music, games, photography, design, media and the visual arts.
Our collective aim is to increase collaboration between the creative industries and in 2014 we launched wecreate.org.nz, providing a one stop portal to a full range of online creative content. The site also publishes industry reports and is a useful place to find what’s on across the creative industries.
We will share more news as WeCreate continues to develop over the year - in the meantime, please visit the site to look, listen, read, play, engage and ENJOY!
WeCreateG R O W I N G O U R C R E AT I V E S E C T O R
W E C R E A T E . O R G . N Z
11
12
TIED TO THE TRACKS
12
The NZ Music Hall of Fame progressed to the next stage of its evolution, with a formal agreement between the partners (APRA and Recorded Music NZ), the launch of a dedicated website (musichall.co.nz) and the institution of a new trophy, affectionately called the Soundshell. The Soundshell was created by acclaimed sculptor, Jim Wheeler.
Tied to the Tracks was a hugely successful NZ Music Month promotion celebrating the digital reissue of 200 NZ albums.
Many of the albums featured had been rare or out of circulation for many years. 150 of the albums were reproduced, mounted and displayed at waterfront restaurant/bar, Tyler St Garage. The gallery remained up for a month longer than initially planned due to the overwhelmingly positive reaction from patrons of the bar.
An opening night was celebrated with performances from Shona Laing and John Hanlon, both of whom had multiple albums from the 1970s and 1980 digitally reissued.
13
Year of Incorporation 1957 WN 010515
Registered Office Level 1, 2A Hakanoa Street
Grey Lynn
Auckland
Business Address Level 1, 2A Hakanoa Street
Grey Lynn
Auckland
Directors C Caddick (Chair)
P Baker
K Boshier
J Hellriegel
A Holt
P Howling
Alternates:
S Cockle (for P Howling)
S Morrison (for K Boshier)
L Nikolao (for P Baker)
DIRECTORYFOR THE YEAR ENDED 31 DECEMBER 2014
SOL3 MIOWinners of Highest Selling Album and Best Pacific Music Album at the 2014 VNZMAs. Photo supplied.
13
14
STATEMENT OF FINANCIAL POSITION FOR THE YEAR ENDED 31 DECEMBER 2014
ASSETS
Cash Assets
Receivables
Prepayments
Investments in Short Term Deposits
Investment in Media Sauce
Fixed Assets
Intangible Assets
TOTAL ASSETS
LIABILITIES
Payables
Funds Available for Distribution
Provisions Retained
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued Share Capital
Less Uncalled Capital
Note
5
5
5
11
12
2014
$
487,779
2,698,613
284,360
7,801,480
147,577
66,142
0
11,485,951
628,954
10,269,818
587,179
11,485,951
0
200
-200
0
2013
$
446,387
2,032,451
408,103
6,947,567
147,577
89,914
23,016
10,095,015
610,063
8,888,668
596,284
10,095,015
0
200
-200
0
The accompanying notes, policies and auditor’s report form part of these financial statements.
14
REVENUE
Radio Broadcast Licence Fees
TV Broadcast Licence Fees
Public Performance Licence Fees
Compiler Licence Fees
Other Income
Interest
DEDUCT EXPENDITURE
Audit Fee Paid
Rental Expenses
Operational Expenses
FUNDS AVAILABLE BEFORE TAXATION
Deduct Professional Expenses
Deduct Taxation Paid
Transfer from Provisions Retained
FUNDS AVAILABLE FOR DISTRIBUTION
Note
5
10
13
2014
$
7,322,188
1,820,010
3,054,020
474,146
507,282
297,193
13,474,839
12,050
130,252
3,112,229
3,254,531
10,220,308
9,105
0
(9,105)
10,220,308
2013
$
6,734,517
1,412,155
2,830,882
452,568
140,582
345,789
11,916,493
13,200
126,382
3,071,493
3,211,075
8,705,418
75,481
28,805
(104,286)
8,705,418
The accompanying notes, policies and auditor’s report form part of these financial statements.
STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 DECEMBER 2014
15
FUNDS AVAILABLE FOR DISTRIBUTION
Distributed to Companies & Recording Artists
Transfer to Allocate Professional Expenses
Transfer to Allocate Taxation Paid
Transfer from RIANZ
Funds at Beginning of Year
TOTAL FUNDS AVAILABLE AT END OF YEAR
Note
6
11 & 12
2014
$
10,220,308
(8,839,158)
(9,105)
0
0
9,484,952
10,856,997
2013
$
8,705,418
(8,391,074)
(75,481)
(28,805)
103,910
9,170,984
9,484,952
The accompanying notes, policies and auditor’s report form part of these financial statements.
STATEMENT OF FUNDS MOVEMENTFOR THE YEAR ENDED 31 DECEMBER 2014
BROODSCaleb and Georgia Knott won Breakthrough Artist of the Year at the 2014 VNZMA. Photo supplied.
16
17
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2014
1. Reporting Entity Recorded Music New Zealand Limited formerly known as PPNZ Music Licensing Limited, ‘The Company’ is registered under the Companies Act 1993 and acts as authorised representative of the major sound recording manufacturing and distributing companies in New Zealand to license, control and promote the public performance and broadcasting of their copyright in sound recordings and music videos, and to collect fees in respect thereof. Distributions are then made to the appropriate copyright holder. The Company is a reporting entity for the purposes of the Financial Reporting Act 1993. The financial statements of The Company have been prepared in accordance with the Financial Reporting Act 1993.
The Company has not traded on its own account during the year; therefore there are no results from operations.
Licensing and Distribution The pro-rata distribution of surplus funds is determined on Radio and Television airtime. The annual surpluses from Broadcasting and Public Performance Licence fees and miscellaneous income received, less the amount retained (to meet liabilities contingent and otherwise), are apportioned to the New Zealand licensees. At balance date, the surplus for the year is retained in Trust pending the receipt and analysis of airtime data received from broadcasters. In the interim, such surplus has been placed on short term investment to attract interest income.
2. Measurement System The financial statements are prepared under the historical cost convention. Income and expenditure is accounted for on an accrual basis. Revenue is recognised when the risks and rewards can be reliably measured.
From 1 April 2014, the new Financial Reporting Act 2013 (“FRA 2013”) has come into force replacing the Financial Reporting Act 1993, this is effective for all for-profit entities with reporting periods beginning on or after 1 April 2014. This will be effective for the company’s 31 December 2015 year end. It is expected that the change in legislation will have no material impact on the company’s obligation to prepare general purpose financial statements.
In addition to the change in legislation the External Reporting Board of New Zealand (“XRB”) has released a new accounting standards framework which establishes the financial standards to be applied to entities with statutory financial reporting obligations. The company is currently reporting under Old NZ GAAP. Under the new XRB framework management expects that the company will be reporting under NZ IFRS applying the Reduced Disclosure Regime (NZ IFRS RDR) as applicable for Tier 2 for-profit entities. This framework reduces the required number of disclosures under NZ IFRS however it does not change the measurement and recognition requirements. This will be applicable for the company’s 31 December 2015 year end.
3. Changes in Accounting Policies There have been no changes in accounting policies. All policies have been applied on bases consistent with those used in previous years.
4. Differential Reporting The Company is a qualifying entity for Differential Reporting as defined by the Institute of Chartered Accountants of New Zealand’s Framework for Differential Reporting as the Company is not publicly accountable and the owners and the governing body are one and the same. The Company has taken advantage of all differential reporting exemptions.
5. Statement of Accounting Policies Investments Investments are measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible Assets Intangible assets that have finite useful lives are measured at cost less accumulated amortisation and accumulated impairment losses.
Impairment The carrying amounts of the Company’s assets are reviewed at each balance date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. Impairment losses directly reduce the carrying amount of assets and are recognised in the Statement of Financial Performance.
continued on page 18
18 18
Due within one year
One to five years
11. Funds available for distribution
Current Year Profit
Other Funds
Total
12. Provisions Retained / General Funds
Balance at 1 January
Transfer from Recording Industry Association
Transfer to Allocate Professional Expenses & Tax
Balance 31 December
13. Operational Expenses Included in operational expenses is income of $820,374 which represents sponsorship and other income received
in relation to the Music Awards. (2013 $923,915.)
14. Directors’ Remuneration The following remuneration was received by directors during the year: Chris Caddick $36,000 Jan Hellriegel $6,000 Peter Baker $6,000
15. Subsequent Event There were no subsequent events in relation to the year ended 31 December 2014.
Taxation The Company has no trading activity and acts as a nationwide non-profit representative for New Zealand licensees. Surpluses are fully distributed and consequently the Company is only liable to pay taxes on timing differences arising from accruals made. The withholding tax on interest income has been deducted; however, due to an IRD ruling no terminal tax is payable by the Company but will be payable by the members.
Goods and Services Taxation The Financial Statements have been prepared on a GST exclusive basis with the exception of receivables and payables, which include GST.
6. Related Party Transactions During 2013 the activities of the Recording Industry Association of New Zealand (Inc.) were incorporated into The Company. On the wind-up of RIANZ (Inc.) net assets were transferred into The Company.
7. Subsidiary Company Record Publications Limited is a wholly owned subsidiary of Recorded Music New Zealand Limited. It has not been consolidated into these accounts as this would provide limited benefit to the members. Record Publications Limited has not traded since 1965. It has a balance date of 31 December 2014.
8. Contingent Liability There is a contingent liability of $797 in respect of uncalled capital of Record Publications Limited.
9. Capital Commitments The Board has no commitments for future capital expenditure as at 31 December 2014 (nil 2013).
10. Lease Commitments There is a commitment with regard to the lease of the premises at Hakanoa Street.
2014
94,280
7,857
2014
10,220,308
49,510
10,269,818
596,284
0
(9,105)
587,179
2013
94,280
102,137
2013
8,705,418
183,250
8,888,668
596,660
103,910
(104,286)
596,284
19
Independent auditor’s reportTo the Directors of Recorded Music New Zealand LimitedReport on the company financial statements
We have audited the accompanying financial statements of Recorded Music New Zealand Limited (“the company’’), on pages 14 to 18. The financial statements comprise the statement of financial position as at 31 December 2014 and the statements of financial performance and funds movements for the year then ended, and a summary of significant accounting policies and other explanatory information.
Directors’ responsibility for the company financial statements
The Directors are responsible for the preparation of financial statements in accordance with generally accepted accounting practice in New Zealand that give a true and fair view of the matters to which they relate, and for such internal control as the Directors determine is necessary to enable the preparation of company 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. We conducted our audit in accordance with International Standards on Auditing (New Zealand). 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 performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the preparation of the financial statements that give a true and fair view of the matters to which they relate 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 company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates, as well as evaluating the presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Our firm has also provided other services to the company in relation to taxation and general accounting services. These matters have not impaired our independence as auditor of the company. The firm has no other relationship with, or interest in, the company.
19
20
Opinion
In our opinion the financial statements on pages 14 to 18:• comply with generally accepted accounting practice in New Zealand;• give a true and fair view of the financial position of the company as at 31 December 2014 and of the financial performance of the company for the year then ended.
Report on other legal and regulatory requirements
In accordance with the requirements of sections 16(1)(d) and 16(1)(e) of the Financial Reporting Act 1993, we report that:• we have obtained all the information and explanations that we have required; and• in our opinion, proper accounting records have been kept by Recorded Music New Zealand Limited as far as appears from our examination of those records.
25 March 2015Auckland
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MA
DE IN
NEW
ZEALAND © Recorded Music New Zealand Limited. P Recorded M
usic
New
Zea
land
Lim
ited.
WE LOVE MUSIC (REMIX)(R.Music) 3:30
SIDE BSTEREO
RECORDEDMUSIC.CO.NZ
Vodafone NZ Music Awards nzmusicawards.co.nz
The Official NZ Music Charts nztop40.co.nz
The New Zealand Music Hall of Fame musichall.co.nz
Public performance licensing by OneMusic onemusicnz.com
Protecting and promoting our music promusic.co.nz
Growing our creative sector wecreate.org.nz
Freephone 0800 88 77 69 Phone (09) 360 5085 Email [email protected] Online recordedmusic.co.nz Post Private Bag 78850 Grey Lynn Auckland 1245
Street Address Level 1, 2a Hakanoa St, Grey Lynn, Auckland 1021
40 YEARS 1975 - 2015
