The publication of World Sailing's 2019 accounts has underlined the fragile nature of the governing body's finances

World Sailing’s 2019 accounts have been published on the governing body’s website, underlining the fragile state of its finances a month or so before the COVID-19 pandemic struck.

The consolidated income statement – showing a deficit for the year of just over £2.5 million ($3.2 million/€2.75 million) – is broadly in line with a forecast circulated at a Council meeting in Bermuda in the final quarter of last year.

Operating income of £3.7 million ($4.8 million/€4.1 million), including £1.47 million ($1.9 million/€1.6 million) from sponsorship and £1.01 million ($1.3 million/€1.1 million) from events, was more than offset by £3.01 million ($3.9 million/€3.3 million) of operating costs and £3.26 million ($4.2 million/€3.6 million) of employment and other administrative expense.

The statement of financial position, and associated notes, is more revealing.

This shows that at the year-end, net assets were down to just £1.84 million ($2.4 million/€2 million).

Net current assets were actually in negative territory to the tune of just over £772,000 ($1 million/€850,000).

This followed a sharp reduction in cash, from £2.53 million ($3.26 million/€2.8 million) a year earlier to £564,170 ($727,780/€620,587), and a more than doubling of creditors due within one year to £2.79 million ($3.6 million/€3.07 million).

Debtors rose from just over £500,000 ($645,000/€550,000) to £1.46 million ($1.88 million/€1.6 million), with unspecified trade debtors soaring from £68,825 ($88,784/€75,707) to £835,670 ($1.08 million/€919,237).

Creditors included £1.41 million ($1.82 million/€1.55 million) of deferred income.

Notes to the accounts confirm, as reported by insidethegames last November, that the body has taken out a bank overdraft facility for £900,000 ($1.16 million/€990,000) at base plus one per cent interest.

Finances are set to be a key issue in World Sailing's next Presidential election, with incumbent Kim Andersen facing three challengers ©Getty Images
Finances are set to be a key issue in World Sailing's next Presidential election, with incumbent Kim Andersen facing three challengers ©Getty Images

The facility is secured against the investment portfolio of World Sailing’s investment trust.

It appears that £100,091 ($129,117/€110,100) had been drawn down at the end of the year.

With COVID-19 having decimated the 2020 sports calendar and forced the postponement of the Tokyo 2020 Olympic and Paralympic Games, World Sailing was one of 15 International Federations (IFs) to be allocated a loan in July by the International Olympic Committee (IOC).

Around $63 million (£48.8 million/€53.7 million) was allocated to IFs in all.

These financial details come just ahead of a Presidential election in which incumbent Kim Andersen is facing no fewer than three challengers, with finance likely to be a key issue.

One candidate, Uruguay’s Scott Perry, says bluntly in a statement of goals entitled “Back to Basics” that “unless we get our finances in order nothing else will matter."

He goes on: “At present we are living on borrowed funds from the IOC.

“That is never a healthy situation to be in.”

The other two challengers are Quanhai Li of China and Spain’s Gerardo Seeliger.

The result of what will be a virtual election is scheduled to be announced on November 1, with the first round of voting starting on October 9.