Tuesday 14 September 2010

The $160,215 community radio black hole

It wasn't difficult to assume that the annual financial statements of Cairns Community Radio would be their Achilles' heal.

Nearly half the entire station's cash was swallowed up - $153,000 - in less than 12 months - at this rate the community radio will be bankrupt by mid next year.

When you hear stories over the last year that a car was gifted to the voluntary president, let alone all his running expenses, because his scooter wasn't fast enough; and that they shout him and anyone in the office free lunches at Raintrees Shopping Centre every day; that over 40 legal letters were sent out to ward off new members, it was always going to be a no-brainer that the money pit was going to dry up.

Of course, none of this information was ever presented to the members, and the ACMA instructed last December, to publish the committee minutes on the station's website. It's now September, 10 months on, and they haven't done the most basic of tasks.

There are some glaring black holes in the annual accounts, and no explanation was given to last night's annual meeting. $152,309 was spent last year, half of the station's entire reserve.

In just seven months, they spent $42,697, double the entire repair and maintenance bill over the previous year ($20,083) - with no improvements at all, as instructed by the ACMA, to the transmitter on Mt Yarrabah; Peter Ricketts was hastily appointed as a new contractor, after Rod Coutts had yet another disagreement and terminated the membership of Shane Wilson who had served the community radio for well over 10 years as technician. In a serious conflict, Ricketts is now a member of the committee, and also a paid contractor.

I've just spent the last couple of hours listening to the recording of last night's meeting. There are a great number of worrying behaviours that occurred throughout the meeting, and these will be reported to the Office of Fair Trading.

However, there were some wins. The dodgy constitution that was to be passed holus-bolus, without any prior written notification to members, was shelved pending another meeting. Rod Coutts and his treasurer, Mimille Alvero, who assumed they would stay for an extra year without any election, were successfully challenged, and made to stand-down. This occurred as the meeting was bought to a momentary halt, whilst they consulted a representative from the station's lawyer, Murray Jones of O'Reilly Stevens Bovey. "As a matter of good faith, they will stand down and go for nomination," Mr Jones told the meeting as a five minute private discussion.

Former presenter and policeman Matt Maloney, called into question several matters with there were unexplained expenses - primarily $100,455 of "other expenses from ordinary activities." He requested to see a breakdown and said he would visit the station's offices to see these.
It appears that at least $20,000 was spent over the last year in legal letters, and another $11,000 on a car for Coutts.

There was general widespread distrust in the audience, for the way the meeting was handled, and the reluctance to disclose and be transparent about the financial management. Over the next few days, I will provide more information, including a video comments from members after the meeting.

Needless to say, Rod Coutts was bunkered down in Brothers till the late hours last night, as 7 News camera crew and CairnsBlog waiting outside. A number of requests were refused to talk with the media and explain his actions. This is a hallmark of his mis-management, however with four more ACMA investigations on the table yet again, and no progress on the Agreed Measures from the ACMA that has to be completed by December, the station is looking very shakey and is starring at the real possibility of losing its broadcasting licence.

The large cash reserves that was built up over preceding years, was meant to go towards substantial infrastructure upgrades to the Mt Yarrabah transmitter site - that is performing well below the required 10 kw ERP. The station currently broadcast only 4kw. It's estimated that at least $250,000 is required to complete this licence requirement, yet public money has been floundered away on free lunches, a car for the president, and legal letters.
Like those legal experts that waded through my legal correspondence over recent weeks, I encourage those accounting and business minds to study this year's accounts of Cairns community radio - in comparison to last years - and give your observations, including questions you would ask as a financial contributor to this community asset.



Ex member said...

What a financial performance!! To go from a profit of $64,000, from a Committee which paid certain of its members, to a loss of $95,000, means a net reduction of $160,000 over the year. This is more than $3,000 a week.

The question which needs to be answered is, where is the $3000 a week going?. As usual, this Committee is unlikely ro provide an answer.

Destiny said...

I love this line :I have conducted an independent audit of this Financail report in order to express an opinion on it to the members of the association. No opinion is expressed whether the accounting policies used, and described in Note 1 are appropriate to the needs of the members.

Cynic said...

Obviously Coutts is quite adept at 'managing' large amounts of federal money and making it seemingly disappear. With such skills he should easily find employment when he is eventually kicked out of the station. Perhaps he could become Warren's travel agent.

Listener agrees with Destiny said...

Destiny might have hit a nail on the head. Plough-through the entire financial report and you
find more black holes than a
Coalition pre-election budget -
and a 'cover-your-arse' disclaimer
by the auditor, who is sensibly
declining to express an opinion
on the validity of the numbers...

can't blame him for that !

KFC said...

After watching the local news tonight I see Billy Lee Long is still lurking around the station. It was his involvement with 4EB - an ethnic broadcaster in Brisbane - and his elevation to President in the late 90's that initially set 4CCR on the lucrative ethnic radio funding money trail and effectively turned a vibrantly diverse community radio station into an exclusive non accountable ethnic broadcaster. Looks like the whole gang is still hanging around.

Lillian at Yorkeys said...

Coutts - Death by Cassowary. What else?

Tony Hillier said...

SBS Radio receives substantial public funding for ethnic broadcasting and does a thoroughly professional and comprehensive job, by all accounts. So why is our hard earned being squandered on shoring up a third-rate service on a community station that conforms to such low broadcasting standards. The public purse, in effect, subsidises a private radio club, run by an oligarchy that is only interested in serving its own interests. Community radio stations, such as 4CCR, were set up in the '80s to provide an alternative to other sectors, both in terms of musical diversity and commentary. It is heartbreaking to witness the demise of what was once a stimulating and eminently listenable radio station.

KitchenSlut said...

Tony, you are quite right and all that is exhibited here is an anachronism that needs to be buried. Sadly for those emotionally attached this is a loss!

I confess to not being atop all the details given since the beginning I have disregarded this as an anachronism of no consequence. The financial numbers here are small which will always slip under the regulatory radar.

Have also never publically claimed any financial qualifications but simply rely on a fair record of success by identifying asking the right questions so will try this again ....

1) Yes MM the cash position has detiorated by @$150k however a slab of this has gone on property,plant and equipment of $45k so what has this been spent on?

2) Yes the car is in the accounts at @$11k so what else is there?

3) Despite large cash holdings @$13k of borrowings was acumulated during the year of which $9.5k was non-current. Huh? Why? is this the car?

4) What are the biggest changes in the accounts? Actually they are in trade receivable and payable! Why?

5) The notes are ALWAYS more interesting than the accounts and here ..... "campaigns" delivered a huge boost over 50%! member subscriptions were up almost 30%?

6) Curiously rent as revenue collapsed while otherwise rental obligation rose? Que? Community radio has rental revenue at all? Why?

7) The public funding was up a bit for the year but raises the question given the cash position why there was any public funding at all given cash would have covered operations for some time ...

Given the low level of public funding @$80k pa it should be obvious that there is no mechanism for accountability in here anywhere and that this is something that should not be funded at a Federal level and preferably buried VERY deep?

wake up call said...

What in god's name are "Other expenses from Ordinary Activities"?? I think the $110,455 needs explaining Mr Coutts -Did you perhaps take a trip to Europe to check on radio over there? or have you a Ferrari tucked away somewhere? last year the same activity cost $12,003 -please explain. I think your little world has just started to crumble.

Shane Wilson, former technician 4CCR said...

It’s interesting to note that in previous years I looked after the engineering department at 4CCR for approximately $20K including IT.

Mr Gerry Pyne looks after Cairns Indigenous radio BBM 98.7 for a similar figure.

From July 2009 to the end of October 2009, I charged 4CCR a figure of $10,126, that would be roughly on budget for a $20K total for the year, and fair amount to charge a small community radio station like 4CCR or BBM.

I believe Townsville's 4TTT engineering budget is much less than $20K - most of the engineering work in Townsville is done by volunteers.

Then along comes Peter Ricketts to Cairns community radio - from November 2009 till June 2010, Ricketts takes nearly $33K, so the total yearly R&M budget at 4CCR is now $56,000!

And we hear from Coutts, Ricketts works on weekends... What value for money!

Chiti said...

Shane Wilson- $10,126 for four months means more than $30 000 a year. I think you are suffering from the Coutts accounting disease as well.

Shane Wilson, 4CCR Member and former technician said...

You're are correct Shiti,

I should have done my accounting homework.

Bbut I have never received any more than $25K per year from 4CCR.

Jono, Townsville community radio volunteer said...

I've just heard that there's going to be an independent audit demanded by a government agency - after all the bad publicity and the release of the 2010 accounts on here on this blog site...........

I guess 8 ACMA investigations in less than 12 months isn't that good for your radio ratings!!!!!!!!!!!!

shit - and I thought we had odd meetings at TTT T'ville sometimes!!!

You can have it Cairns!!!!!

Ross Parisi said...

Notwithstanding Mr Coutts' reluctance to table the Financial Report for the year ending 30th June 2010, I have a copy.

I will be having the Financial Report audited by a reputable local accountancy firm and the report will be published on Cairns Blog and the Friends website.

The Friends will be discussing the Report at the next meeting and a course of action will be adopted as well.

Therefore, I do not wish to pre-empt the findings by commenting prematurely.

Michael Hyams said...

I attended at the site of the AGM with my wife Lisa, who is a paid up member. I had ith me a letter from Centrelink saying that I was my Wife's Carer,with a view to being able to see and hear what went on in the meeting but of course not being able to open my mouth (hard for me).Coutts wouldnt even read the letter, threw it back in my face with the words "Go away, Michael, you are not wanted around here" I am taking this matter up with Carers Aust. In the meeting my wife was humiliated and shouted down from the floor, whom, she tells me were egged on by the Chair. She was bullied. None the less she offered her time to inspect the reaiming boxes of historical information from the late Arona management. I wonder what happened to the rest of the incriminating material left behind by Nils Briet's band of brigands. The offer from her is on the table, but I doubt if you will find it in the minutes. Thechances are that the naterial will be such that Coutts and Fielder I(Another God-bothering hypocrite) would rather remain under wraps. Lisa's concern is that Coutts didnt run the meeting. To the contrary it sounds like the`meeting ran him. All of this will be communicated to ACMA, by me but I doubt that they will take much notice. Oh, by the way, my Appeal against being deprived of membership still remains unanswered 7 months later.Perhaps Capt.Mainwaring is` waiting for an estimate from his Lawyers, for the cost to the Station of actually doing something about it. How long is my patience expected to last. If I could sign off :"Seig Heil" in Dutch I would

JudeJohnston said...

Employee benefits (entitlements) assumes that somewhere in the P&L is "wages".
This "ordinary expenses from ordinary activities" looks like it should be more acurately described as Cost of Sales and not lumped down with expenses.
It will be interesting to see the paper trail of the $104k,