Aifa has reported an operating deficit of £194,419 for the year to June 30 compared with a small surplus the previous year as the trade body considers a restructure of its funding.
Its annual results, revealed on the Money Marketing website this week, show turnover has dropped by 12 per cent from £1,853,393 to £1,629,319. Its surplus for 2009/10 was £14,919.
Aifa’s total reserves have fallen from -£47,556 to -£194,781 while annual subscriptions are down by 14 per cent from £1,393,680 to £1,202,984. Directors’ pay has been cut by 33 per cent from £205,000 to £137,310. Marketing and distribution spend has been slashed by over half from £90,318 to £38,799.
The deficit disclosure comes as Aifa considers changes to the way it is funded. Proposals that have been discussed as part of its ongoing strategic review include network members paying higher subscriptions.
Director general Stephen Gay says: “The actions we have taken this year to reduce our cost base mean we will be able to serve the interests of members in the year ahead.”
Sesame Bankhall Group executive chairman Ivan Martin, who also sits on the Aifa Council, says: “What we have to look at is how we can attract members. This is not an immediate crisis situation.”
Honister Capital chief executive Richard Pearson says: “Splinter groups are starting up but everyone must get behind Aifa. Advisers will only get their voice heard if they have one voice.”
Philip J Milton & Company managing director Philip Milton says: “If bigger firms are not paying a proportionate sum, maybe they should but I would not want to see fees going up and firms not remaining members.”