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table of content
Financial Statements2006
table of content
table of content
Key figures 4
Buma five-year plan 6
Stemra five-year plan 7
Report of the management boards 8
Directors’ report 10
Buma financial statements for 2006 13
Stemra financial statements for 2006 31
Composition of the management boards and directors 47
Table of Contents
3 Financial Statements 2006
4 Buma/Stemratable of content
Key figures
70,432 61,972 60,757 53,455 48,421
0
50
100
150
200
2002 2003 2004 2005 2006
111,577 106,002 112,770 113,575 119,972
0102030405060708090
100110
2002 2003 2004 2005 20060
20
40
60
80
2002 2003 2004 2005 2006
-20
-15
-10
-5
0
5
10
15
20
2002 2003 2004 2005 2006
buma/Stemra turnover developmentTurnover in EUR millions
Results of buma/StemraResult in EUR millions
breakdown of 2006 turnover in percentages - Stemrabreakdown of 2006 turnover in percentages - buma
0.5% Performing Rights Online Licensing 9.5% Cable 10.5% Workplaces 8.8% Sales Outlets 7.3% Performing Rights Abroad 35.2% Radio & TV Performing Rights 15.3% Stage 12.9% Catering
9.8% HHome Copy/Lending Rights 11.4% Mechanical Rights Abroad 2.2% Mechanical Rights Online
Licensing 12.6% Radio & TV Mechanical Rights 49.4% Biem Phonomechanical Rights/
Central Licensing 14.6% Special Licensing/Private Labels
Associates and members Foreign organisations Administrative costs deducted
Distribution by StemraRoyalties in EUR millions
Distribution by bumaRoyalties in EUR millions
Central licensing Associates and participants Foreign organisations Administrative costs deducted
Financial result Profit/loss on ordinary activities Operating loss
Buma Stemra
Stemra Buma
5 Financial Statements 2006table of content
0
50
100
150
200
250
300
350
2002 2003 2004 2005 2006
buma/Stemra staffing levelsAs at year-end
Net turnover of Buma can be specified as follows:(EUR x 1,000)
2006 2005 2004 2003 2002
Radio&TVPerformingRights 42,286 41,981 41,180 37,739 47,519Stage 18,354 15,499 15,443 14,910 11,620Catering 15,431 14,582 15,279 14,683 13,876Workplaces 12,620 11,853 11,172 10,805 10,055SalesOutlets 10,605 9,935 10,389 9,806 9,379PerformingRightsOnlineLicensing 564 331 380 201 591Cable 11,387 11,110 10,495 10,998 10,481PerformingRightsAbroad 8,725 8,284 8,432 6,860 8,056
119,972 113,575 112,770 106,002 111,577Net turnover of Stemra can be specified as follows:(EUR x 1,000)
2006 2005 2004 2003 2002
BiemPhonomechanicalrights/CentralLicensing 23,917 25,859 30,474 33,627 37,478SpecialLicensing/Privatelabels 7,064 9,540 8,421 8,648 7,865Radio&TVMechanicalRights 6,124 7,430 10,376 10,040 13,103MechanicalRightsOnlineLicensing 1,081 827 833 1,005 -HomeCopy-LendingRights 4,727 5,093 5,296 3,404 5,037MechanicalRightsAbroad 5,508 4,706 5,357 5,248 6,949
48,421 53,455 60,757 61,972 70,432
Part-time FTEs Full-time FTEs
Num
ber o
f FTE
s
6 Buma/Stemra
Buma five-year plan for 2002 to 2006
Buma five-year plan for 2002 to 2006(EUR x 1,000)
2006 2005 2004 2003 2002
Turnover 119,972 113,575 112,770 106,002 111,577 Profit and loss accoun Income 2,828 2,764 2,723 2,951 2,578Expenses -14,772 -14,129 -13,790 -12,706 -12,696 Operatingprofit/loss -11,944 -11,365 -11,067 -9,755 -10,118 Financialresult 9,392 8,400 8,148 11,497 2,780 Profit/lossonordinaryactivities -2,552 -2,965 -2,919 1,742 -7,338 Extraordinaryloss - - - -1,050 -1,500 Result -2,552 -2,965 -2,919 692 -8,838
Distribution Tobedistributedatyear-end 136,798 128,614 126,012 116,484 121,680 Availablefordistribution 121,578 114,814 113,356 110,128 105,989
Key index figures Totalturnoverindex(2002=100) 108 102 101 95 100 Operatingcostsindex(2002=100) 116 111 109 100 100 Tobedistributedatyear-end/available 112.5% 112.0% 111.2% 105.8% 114.8% Operatingcostsas%ofturnover 12.3% 12.4% 12.2% 12.0% 11.4% Availablefordistributionas%ofturnover 101.3% 101.1% 100.5% 103.9% 95.0%
table of content
7 Financial Statements 2006table of content
Stemra five-year plan for 2002 to 2006
Stemra five-year plan for 2002 to 2006(EUR x 1,000)
2006 2005 2004 2003 2002
Turnover 48,421 53,455 60,757 61,972 70,432 Profit and loss account Income 5,248 4,916 5,089 5,675 5,541Expenses -9,652 -9,296 -8,930 -9,964 -9,663 Operatingprofit/loss -4,404 -4,380 -3,841 -4,289 -4,122 Financialresult 4,325 4,226 4,201 4,544 4,548 Profit/lossonordinaryactivities -79 -154 360 255 426 Extraordinaryloss - - - -750 -1,500 Result -79 -154 360 -495 -1,074 Distribution Tobedistributedatyear-end 51,332 56,513 51,774 47,303 50,278 Availablefordistribution 50,344 55,652 61,868 61,743 70,271 Key index figures Totalturnoverindex(2002=100) 69 76 86 88 100 Operatingcostsindex(2002=100) 100 96 92 103 100 Tobedistributedatyear-end/available 102.0% 101.5% 83.7% 76.6% 71.5%
Operatingcostsas%ofturnover 19.9% 17.4% 14.7% 16.1% 13.7% Availablefordistributionas%ofturnover 104.0% 104.1% 101.8% 99.6% 99.8%
8 Buma/Stemratable of content
Report of the Management Boards
Financial Statements WearepleasedtopresentthefinancialstatementsofVerenigingBuma[BumaAssociation]andStichtingStemra[StemraFoundation].Bothsetsoffinancialstatementsreceivedanunqualifiedauditor’sreportfollowingauditingbyKPMGAccountantsN.V.Werecommendthatyouapprovethe2006financialstatementsofBumaandStemra,includingtheproposalsbytheboardofdirectors,anddischargethemanagementboardsandtheboardofdirectors.
Management boardsThemanagementboardsofBumaandStemrametseventimesduringthereportingyear.TheSupervisoryBoardmetfivetimes.
Duringtheyearunderreview,considerableattentionwaspaidtotherolethatourorganisationswouldlikeandneedtoplayintherealmofEuropeanmusiccopyrights.ThebasicpremiseencompassesthepolicyplansoftheEuropeanCommission,whichfocusonstimulatingmutualcompetitionbetweenrightsorganisations.Theemphasisisongivingrightownersthefreedomtoberepresentedbytherightsorganisationoftheirchoicewhenitcomestotheuseoftheirworksinanonlineenvironment.Thiscanclearlyhavesignificantimplicationsforourorganisations.Fortunately,theorganisationshavecarefullypreparedthemselvesforthisdevelopmentinrecentyears.In2006,thisenabledustoclearlydefinethefutureroleofourorganisationsandtotakedecisionswithregardtorealisingthatrole.ItisourambitiontogrowintooneofthelargermusiccopyrightorganisationsinEurope.However,inordertobecomeandremainanattractivepartnerfordomesticandinternationalrightownersandusers,wewillneedtokeepourcostsaslowaspossible.Asaresult,wehavedecidedtooutsourceasignificantproportionoftheback-officeactivitiestoathirdparty.Theorganisationswillbegearedtotheinternationalrolewewanttofulfil.
AttheJointMeetingofMembersandAssociatesoftheVerenigingBumaandStichtingStemra,adecisionwastakentocommencefor-malpreparationsforthepossibilityofincludingcopyrightandotherlegalentitiesasrightowners.Thisconcernstheso-called‘AuteursBV’[Dutchprivatelimitedcompanyforauthors].ThereisanincreasingdemandforBuma/StemratomakeitpossibleforpaymentstogotothepersonalBVsofauthorsasthisoffersbenefitswithregardtovalueaddedtax.Thedecisionthathasbeentakenopensthedoortothefur-therelaborationoftheAuteursBVtoacquiretheroleofrightownersinregulationsandcontracts.
MuchtimewasspentonthediscussionconcerningFlexibleCollectiveManagement.Withinthisframework,theorganisationsarelookingforwaystoimprovethelevelofserviceprovidedtoparticipants,andtooffermoretailor-madesolutions,whileretainingthebenefitsoftheexistingcollectivemanagement.Theinitialdetailsofthisconceptwerepresentedtotheorganisationsintheautumn.Itinvolvesthreeprojectsthatwillbetestedinthefirsthalfof2007.
ThenewwebsitewhichwasintroducedinSeptemberrepresentsasignificantstepforwardintermsofthelevelofserviceweprovide.Rightownersnowhavedirectonlineaccesstoouradministrativesys-temsinsofarasitconcernstheirownaccounts.In2007thewebsitewillalsoofferthepossibilityforuserstoapplyforandobtainlicences.
Afterafewmonthsofpreparationinthecourseof2006,Buma’smanagementboardalsotookanimportantdecisionconcerningtheirstrategywithregardtosupportingDutchmusiccopyrights.TheexistingConamusFoundation,financedbyBuma,hasalwaysfocusedonsupportingDutchmusiconadomesticandinternationalscale.Inaddition,Bumaitselfwasresponsibleforsupportingmusicintheclassicalsector,aswellasjazzandcabaret.Theseactivitieswereplacedinasinglegroupinthecourseof2006andtransferredtotheBumaCultureFoundation.
Thenewpensionplanformusicauthorscommencedin2006.Unfortunately,agreatdealoftimewastakenupbyacquiringtheobligatoryparticipationofindependentartistsinthenewoccupationalpensionscheme.Asaresult,circumstanceschangedconsiderably,requiringnumerousnewadaptations.Butbytheendof2006,asidefromanumberofminorpoints,allthosewhowereeligibleforthepensionschemehadjoinedthenewsystem.
Duringthereportingyear,themanagementboardsextensivelydiscussedtheprogressoftheimplementationofthenewcomputersystemAxapta,thelicencesforonlinemusicuse,therelationshipwithCreativeCommonsandtheresultsachievedwiththeFingerprintingsystem.Inaddition,theannualreportfor2005wasdiscussedandattentionwaspaidtotheVasteCommissiePlagiaat(PermanentCommitteeonPlagiarism),thenewpensionplanformusicpublishers,arbitrationrules,theCannesAgreement,theinvestmentpolicyandthebudgetsfor2007forBumaandStemra.
TheAnnualGeneralMeetingofMembersandAffiliates,whichwasheldattheSchouwburginAmstelveenforthesecondtime,re-electedMessrs.VanEmpelen,SchramaandAbdoelbasier.Messrs.WestbroekandMensinkwereappointedtothemanagementboardofBuma.Themeetingre-electedMessrs.BrandsandKostermanandappointedMr.BruenstothemanagementboardofStemra.
Thisyearwasthesecondtimethattheannualmeetingincludedapublicsectiontowhichrepresentativesofmusicusers,governmentauthori-ties,politicsandthemediawereinvited.AfteradetailedexplanationofthepolicyofBuma/StemrabyChairmanMr.J.Boerstoel,StateSecretaryMs.K.vanGennipofEconomicAffairsspokeaboutcreativityandentrepreneurship.TheopensectionoftheannualgeneralmeetingincludedaperformancebyJeroenvanMerwijk,winnerofthe2005AnnieM.G.SchmidtAward.
9 Financial Statements 2006table of content
ThemeetingsaidfarewelltoJanBoerstoelaschairman.HestoodupforBumainhisfinalspeech.Onbehalfofthemanagementboards,vice-chairmanMr.K.BoehmerthankedMr.Boerstoelforthegreatcontributionhehadmadeduringhistenyearsaschairman.HecommentedonhowBuma/Stemrahadchangedoverthisperiodintoanefficientlyoperatingorganisation,whereimprovingthelevelofserviceprovidedtorightownersandtoughcostcontrolgohandinhand.
Atthemeetingof6September,Mr.K.BoehmerwasappointedchairmanofthemanagementboardsofbothBumaandStemra.
Themanagementboardsareextremelyconcernedabouttheturnoverdevelopmentattheorganisation.ItisclearthatthetrendofonlinemusicuseoffersinsufficientcompensationforthedropinsalesofCDsandDVDs.Alsoagainstthisbackground,itisimportantforthecom-ingperiodthatBuma/Stemrasucceedsingeneratingextraturnoverbyattractingforeignrightownersandacquiringcontractswithlargeinternationalmusicusers.Wecanonlysafeguardthecontinuityofouractivitiesinthelongtermbyincreasingturnoverandreducingcosts.
ThemanagementboardsofBumaandStemraHoofddorp, 4 April 2007
10 Buma/Stemratable of content
General Astringentcostpolicy,coupledwiththehighestlevelofservice,leadingtothehighestpossiblepaymentstoourrightowners,hasbeenattheheartofBuma/Stemra’sfinancialpolicyforthepastdecade.Ourcostpercentages,whichareamongthelowestinthesectorofcopyrightorganisations,provethatwearesuccessfulinthis.In2006,preparationsweremadeforasignificantstep,whichisexpectedtostarthavinganimpactontheorganisation’sfinancialframeworkfrom2008onwards.Itinvolvesoutsourcingasignificantproportionoftheback-officeprocesses.ThiswillmakeasignificantcontributiontowardsfurtherloweringthecostlevelsofBuma/Stemraonastructuralbasis.
Itwasdecidedtoredefineanumberofturnovercategoriesinthisannualreport,sothattheoriginoftherelevantturnoverisexpres-sedmoreclearly.ThishasresultedintheRadio&TelevisionandSatellitecategoriesbeingcombinedatBumatobecometheRadio&TVPerformingRightscategory.TheOnlineLicensingcategoryhasbecomeacategoryinitsownrightandisnowcalledPerformingRightsOnlineLicensing.ThesameappliestotheForeignturnovercategory,whichisnowcalledPerformingRightsAbroad.
Startingwiththisannualreport,thefollowingturnovercategoriesaregoingtobeincludedinthefinancialrecordsforStemra:theRadio&TelevisionandSatelliteturnovercategorieshavebeencombinedintheRadio&TVMechanicalRightscategory,wherebytheOnlineLicensingcategoryhasbecomeacategoryinitsownrightandisnowcalledMechanicalRightsOnlineLicensing.ThesameappliestotheForeignturnovercategory,whichisnowcalledMechanicalRightsAbroad.TurnoverintheDutchIndustry,CentralLicensingandCentralLicensingForeigncategorieshavenowbeenincorporatedintoBiemPhonomechanicalRights/CentralLicensing.TheSpecialLicensingandPrivateLabelscategorieshavealsobeencombined.HomeCopy/LendingRightsturnoverhasremainedunchanged.Inordertofacilitatecomparisonwithpreviousyears,theturnoverdistributionforBumaandStemrahasbeenadjustedtothenewcategoriesfortheperioduptotheendof2002.
Buma’s turnover In2006,Buma’sturnoverroseby5.6%(EUR6.4million)toEUR120million.Allthecategoriescontributedtothisturnoverincrease,partlythankstotheindexingofratesin2006.ThebiggestincreasetookplaceintheStagecategory.TheconcertseriesbyMarcoBorsatointheGelredomeandtheconcertsgivenbyRobbieWilliams,MadonnaandtheRollingStonesintheArenAcontributedtothis.TurnoverintheCateringsectorroseby5.8%toEUR15.4million,partlyduetothefactthatvariousamateurfootballclubswereinvoicedforarrears.Thecontinuedfocusonmarketingalsoresultedinincreasesinothercategories.SalesOutletsroseby6.7%,inparticularinthesec-torBackgroundMusicMechanical.Supermarkets&Workplacesroseby6.5%asaresultofanincreaseintheSocialWorkandHealthcaresectors.TurnoverintheRadio&TVPerformanceRightscategory
remainedvirtuallyunchangedatEUR42.3million.Turnoverincreasedby5.3%inthePerformanceRightsAbroadcategory.
Stemra’s turnoverStemra’sturnovercontinuedtobeundergreatpressurein2006,duetothedownward-movingmusicmarket.IntheNetherlands,CDandDVDsalesdroppedevenfurtherin2006,notonlyintermsofquantity,butalsointermsofmoney.Asaconsequence,StemrawasforcedtoacceptadropinturnoverofEUR5milliontoEUR48million.Nearlyallthecategoriesexperiencedadropinturnoverin2006.InthecaseofRadio&TVMechanicalRights,thedropwaslimitedtojustoverEUR1.3million.TurnoverintheMechanicalRightsAbroadcategoryincreasedtoEUR5.5millionpartlythankstosalesoftheRollingStones“ABiggerBang”CDin2005andextraturnovergeneratedfromsalesofthe“HungUp”CDbyMadonna.TheSpecialLicensing/PrivateLabelcategoryhadtodealwithcontractingpartieswhoswitchedtoaforeignrightsorganisation.TheMechanicalRightsOnlineLicensingcategoryformedapositiveexception,asitsturnoverincreased.
Buma’s resultBuma’sresultamountedtoaEUR2.6millionlosscomparedwithaEUR3.0millionlossin2005.Itshouldbenotedthattheresultimpro-veddespiteexpensesonmajorinvestments.Thesemainlyconcernthefurtherdevelopmentofthefingerprintingsystem,theimplementationoftheintegratedsoftwaresysteminwhichalladministrativeproces-seshavebeenbroughttogether,andthedevelopmentofawebsiteandportalspecificallygearedtothis,whichenablesrightownerstoviewtheiraccountsonline.
Expensesroseby4.5%fromEUR14.1millionin2005toEUR14.8millionin2006.Ontheotherhand,incomeamoutedtoEUR2.8million.Asaresult,theoperatinglossamountedtoEUR11.9millioncomparedwithEUR11.4milliontheyearbefore.ThepositivedevelopmentofthestockmarketscontributedtoariseinthefinancialresultfromEUR8.4millionin2005toEUR9.4millionin2006.ItwasthuspossibletoaddEUR1.3milliontotherevaluationreserve.ThefinalresultwasaEUR2.6millionloss(2005:aEUR3.0millionloss).
Translatedintocostpercentages,thisresultmeansthatBumaonlywithholds2.1%ofeacheurocollectedtocoverthecostsitincurs.ThisonceagainmakesBumaoneofthemostefficientmusiccopyrightorganisations,withbyfarthelowestcostwithholdingpercentage.
Stemra’s result Stemra’sresultimprovedslightlyin2006andamountedtoalossofEUR0.1million.IncomeincreasedsomewhattoEUR5.2million(2005:EUR4.9million).ExpensesamountedtoEUR9.7million(2005:EUR9.3million).IncomefrominvestingactivitieswentupslightlytoEUR4.3millioncomparedwithEUR4.2millionin2005.Theresultfromordinarybusinessoperationsandthefinalresult
10 Buma/Stemra
Directors’ Report
11 Financial Statements 2006table of content
amountedtoalossofEUR0.1million.Thiswasaslightimprove-mentcomparedwith2005,whichwasroundedoffwithalossofEUR0.2million.
Accounting policies for determining the investment resultSharesandbondsarestatedonthebalancesheetatmarketpricesatbalancesheetdate.Theensuingpriceperformanceisnottakendirectlyasresulttotheprofitandlossaccount,butisfirstincorporatedintotherevaluationreserve.Insofarasthebalanceofthisrevaluationreserveallowsit,inadditiontothesharedividendreceivedand,fromthebeginningof2006,inadditiontotheinterestreceivedonthefixed-incomeportfolio,a‘standardreturn’isincludedinthefinancialresult.Themethodabovefitsinwiththerequirementthattherecordedinvest-mentresultsonsharesandfixed-incomesecuritiesshowthemostevendevelopmentpossibleintheprofitandlossaccountovertheyears.
DistributionFortheyear2006,BumahadEUR121.6millionavailablefordistribu-tion,comparedwithEUR114.8millionforthepreviousyear.Intermsofapercentageofturnover,101.3%isavailablefordistribution.In2005,thisamountedto101.1%.StemrahasEUR50.3millionavailablefordistribution(2005:EUR55.7million);asapercentageofturnover,thisamountsto104.0%(2005:104.1%).
Commission rates In2006,theEuropeanCommissionterminatedtheprocedureconcerningtheCannesExtensionAgreementof18November2003whichhadbeenpresentedtoit.OncetheCommissionhadindicateditsobjections,musicpublishersandmusiccopyrightorganisationsamendedtheagreementonthepointsinquestion.TheEuropeanCommissionsubsequentlyapprovedtheseamendments,asaresultofwhichtheprocedurewasbroughttoaclose.Nochangeswereintroducedtothecommissionratesthatapply.
Organisation In2006,adecisionwastakentooutsourceanumberofactivitiesoftheBackOfficetoathirdparty.Expectationsarethatfullagreementcanbereachedin2007,andthatthetransferoftheactivitieswilltakeplaceduringthepresentfinancialyear.Asaconsequenceofthis,alargenumberofjobswillbelost.Eventhoughsomeoftheexistingcostswillbereplacedbythecostofoutsourcingtheactivities,themovewillresultinsavingsinthelongerterm.Buma/Stemratookthisdecisionbecausethismovewillenableittoreducecostsonastructuralbasis.Secondly,itwillallowtheorganisa-tiontoconcentratefullyonimprovingthelevelofserviceprovidedtorightownerswhoarealreadyassociates,andonattractingnewrightownersandlargeinternationalmusicusersintheNetherlandsandbeyond.
Outlook Comparedwith2006,weseepossibilitiesforincreasingBuma’sturnoverinthecurrentfinancialyear,whileStemra’sturnoverwill continuetodrop.AlthoughStemradoesindeedbenefitfromthegrowthoftheonlinemusicmarket,theamountsinvolvedarenotyetbigenoughtocompensateforthedropinsalesofCDsandDVDs.Internally,attentionwillbefocusedonsuchpointsasimplementingtheoutsourcingofanumberofBackOfficeactivities.Wehavehighexpectationswithregardtothenewwebsiteandportalthatwerelaunchedintheautumnof2006.Theyhavemadeitpossibleforrightownerstocompleteasignificantnumberoftheiradministrativetaskswithusonline.Ourambitionistoimprovetheonlineservicesprovidedtomusicusersinthecurrentfinancialyearsothat,forexample,theycanapplyforandobtainlicencesonline.Wewouldliketothankouremployeesfortheircommitmentandourrightownersandusersfortheirconfidenceinourorganisationoverthepastyear.
TheboardofdirectorsofBuma/StemraHoofddorp, 4 April 2007
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table of content
Financial statements for 2006Buma
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14 Buma/Stemratable of content
14 Buma/Stemra
Buma balance sheet as at 31 December 2006
Buma balance sheet as at 31 December 2006 After appropriation of the result(EUR x 1,000)
31 December 2006 31 December 2005*
Assets
Fixed assets Intangible fixed assets (1) Companyinformationsystem 914 2,063 914 2,063tangible fixed assets (2) Hardware/Computerequipment 424 519 Otheroperatingassets 858 1,435 1,282 1,954financial fixed assets (3) Securities 173,938 180,089 Participatinginterests -549 -232 173,389 179,857Current assets accounts receivable Debtors 12,181 12,529 Currentaccountbalances(4) 12,197 8,775 Taxesanddividends 326 83 Otherreceivablesandprepayments(5) 8,326 8,190 33,030 29,577cash at bank and in hand (6) Timedeposits 20,689 8,808 Othercashatbankandinhand 2,052 1,311 22,741 10,119
231,356 223,570Liabilities
funds (7) 16,589 13,860 Revaluation reserve financial fixed assets (8) 14,475 13,132 31,064 26,992Provisions (9) 15,455 17,482 46,519 44,474current liabilities Royaltiestobedistributed(10) 136,798 128,614 Debtstocreditinstitutions - 3,000 Creditors 7,346 5,188 Currentaccountbalances(11) 37,030 36,480 Taxesandsocialsecuritycontributions 696 379 Otheraccrualsanddeferredincome(12) 2,967 5,435 184,837 179,096
231,356 223,570*adjustedforcomparisonpurposes.
15 Financial Statements 2006table of content
Buma profit and loss account for 2006
Buma profit and loss account for 2006(EUR x 1,000)
2006 2005*
Income Administrativecostscharged 689 534 Entrancefeesandannualallowances 457 495 Otherincome 1,682 1,735 2,828 2,764Expenses Staffcosts(13) 8,949 8,680 Accommodationcosts 1,110 1,068 Depreciationandamortisation 594 547 Investmentcosts 1,459 1,094 Othercosts 2,660 2,740 14,772 14,129 Operatingprofit/loss -11,944 -11,365 Financialresult(14) 9,392 8,400 Result -2,552 -2,965 Resultdeductedfromroyaltiestobedistributed -2,552 -2,965
*adjustedforcomparisonpurposes.
16 Buma/Stemratable of content
16 Buma/Stemra
Buma cash flow statement
Buma cash flow statement(EUR x 1,000)
2006 2005
cash flow from operating activities Turnover 119,972 113,575Distribution -98,640 -97,775Operatingprofit/loss -11,944 -11,365Depreciationandamortisation 594 547Investmentcosts,includingcharge-on 2,063 1,823Depreciationandamortisationchargedon 421 451WithdrawalfromFundforculturalandsocialpurposes -7,867 -5,247Changesinindemnificationobligation 26 -1Withdrawalfromprovisions -2,053 -2,294Resultofparticipatinginterests 317 232Changesinaccountsreceivable(excl.interestdue) -3,538 -3,902 Changesincurrentliabilities(excl.royaltiestobedistributed) 557 -323 -2,981 -4,225 Cashflowfrombusinessoperations -92 -4,279
Interestreceivedonsecurities 8,617 7,740 Interestpaidonsecurities -712 -549 7,905 7,191 Cashflowfromoperatingactivities 7,813 2,912
cash flow from investing activitiesInvestmentsinintangiblefixedassets -989 -2,401 Investmentsintangiblefixedassets -276 -401 Disposaloftangiblefixedassets 8 - Disposalofparticipatinginterests - 229 Cashflowfrominvestingactivities -1,257 -2,573 cash flow from investing activities Purchaseofsecurities -120,468 -90,254 Repayments/sales 129,534 83,827 Cashflowfromsecuritiestrading 9,066 -6,427 changes in cash at bank and in hand and debts to credit institutions 15,622 -6,088
17 Financial Statements 2006table of content
Notes to the Buma balance sheet and profit and loss account
General
objective of Vereniging buma [buma association]TheAssociation’saimistopromoteboththetangibleandintangibleinterestsofmusicauthorsandpublishers,withoutaprofitmotiveofitsown.TheAssociationparticipatesintheimplementationandpromotionofvariousactivitiesinthiscontextforthepurposeofthisobjective.
Accounting policies for the valuation of assets and liabilities and determination of result GeneralThepoliciesusedforthevaluationofassetsandliabilitiesandthedeterminationofresultarebasedonhistoricalcost.
Unlessstatedotherwise,assetsandliabilitiesarestatedatfacevalue.Incomeandexpensesareallocatedtotheperiodtowhichtheyapply.
Whereapplicable,thefiguresforthepreviousfinancialyearhavebeenadjustedtofacilitatecomparisonwith2006
Accounting policies for the conversion of foreign currenciesTransactionsinforeigncurrenciesareconvertedtoeurosattheappli-cableexchangerateonthetransactiondate.Monetaryassetsandliabilitiesareconvertedtoeurosatbalancesheetdateattheexchangerateapplicableonthatdate.Exchangeratedifferencesoccurringduringconversionaretakentotheprofitandlossaccount.Non-monetaryassetsandliabilitiesinforeigncurrencythatarevaluedonthebasisofhistoricalcostsareconvertedattheapplicableexchangerateonthetransactiondate.
Principles of consolidationInviewofthetransparentstructure,StichtingBumaStemraObligatie-fonds[BumaStemraBondFundFoundation]andStichtingBumaStemraAandelenfonds[BumaStemraEquityFundFoundation]areincludedintheBumafinancialstatementsbymeansofproportionalconsolidation.Assetsandliabilities,aswellasincomeandexpense,areincludedinproportiontotheparticipatinginterest.Onthebasisoftheinformationprovidedinthenotes,noseparatefinancialstatementsforBumaareincluded.
Intangible fixed assetsTheintangibleassetsconcerntheexpenseforthenewbusinessinfor-mationsystemtosupporttheprimarybusinessprocesses.Thesearevaluedathistoricalcostlesscumulativeinvestmentexpensesoramorti-sation.Theinvestmentsarechargedtotheprofitandlossaccountoveraperiodofthreeyears.
Tangible fixed assetsThevaluationoftangiblefixedassetstakesplaceonthebasisofhistori-calcostlesscumulativedepreciation.
Thedepreciationiscalculatedasapercentageofthepurchasepriceaccordingtothestraight-linemethodonthebasisoftheexpectedeconomiclife.
Thefollowingexpectedeconomiclivesareused:•Hardware/Computerequipment3years•Otheroperatingassets3-7years
Financial fixed assetsBondsandsharesarestatedatmarketvalue.Valueadjustmentsaretakendirectlytotherevaluationreserve.Thispreventstheoperatingresultfrombeinginfluencedtoostronglybypricefluctuations.Iftherevaluationreserveisinsufficient,thereductionsinvaluearechargedtotheresult.Eachyear,thesizeoftherevaluationreserveneededtoabsorbthesepricefluctuationsisdeterminedbytheboardofdirectorsinconsultationwithitsassetmanagers.Iftherevaluationreserveislargerthandeemednecessary,thissurplusiseligibleforadditiontotheroyaltiestobedistributed.Withregardtotheresultforshares,astandardreturnisentered,ifpossible.
Participating interestsParticipatinginterestsarecapitalinterestsinwhichsignificantinfluenceisexercisedonthebusinessandfinancialpolicy.Participatinginterestsareincludedatnetassetvalue.
Standard return Thestandardreturniscalculatedasapercentageoftheaveragevalueofthesharesoverthefinancialyear,andcomprisestheeffectivereturnon5-yearEurogovernmentbondsattheendofthefinancialyearplusariskmark-up.Thedifferencebetweenthestandardreturnandthedividendreceivedonsharesiswithdrawnfromtherevaluationreserve,ifpossible.
Accounts receivableAccountsreceivablearestatedatfacevaluelessaprovisionforuncol-lectability.
Determination of resultIncomeandexpensearerecordedintheyeartowhichtheyapply.Theresultisdeterminedbycalculatingthedifferencebetweentheincomerealisedontheonehand,andthecostsandotherexpensesincurredforoperationfortheyearontheother.Thebalanceoftheprofitandlossaccountandthemovementinthefundsisthereforeaddedto/deductedfromtheroyaltiestobedistributed.
18 Buma/Stemratable of content
TurnoverInthefinancialstatements,theturnoverinroyaltiesisaddedtotheroy-altiestobedistributed.Bumaincludestheexploitationofperformingrightsintheturnover,insofarastheserelatetothefinancialyear,canbedeterminedinareliablemanner,andthereisreasonablecertaintythattherevenueiscollectible.
TaxesWithregardtoBuma,theDutchtaxauthoritiesstipulatedinanagree-mentdated6November2001,determiningthelegalrelationshipbetweentheparties,thatVerenigingBumaisliabletopaycorporationtax.Thisagreementisvaliduntil31December2007.Foreignwithhol-dingtaxavailableforset-offandDutchdividendtaxmaybedeductedfromthetaxduebyvirtueofthisagreementdeterminingthelegalrelationshipbetweenparties.Ataxitemisonlyincludedinthefinancialstatementsifcorporationtaxisstillowedafterdeductionoftheforeignwithholdingtaxavailableforset-off.
accounting policies for cash flow statementThecashflowstatementisdrawnupaccordingtotheindirectmethod.
Use of estimatesDrawingupthefinancialstatementsrequiresthemanagementtoformopinionsandmakeestimatesandassumptionsthatinfluencetheappli-cationofpoliciesandthereportedvalueofassetsandliabilities,andofincomeandexpense.
Theestimatesandtheassociatedassumptionsarebasedonpastexpe-rienceandvariousotherfactorsthatareconsideredreasonableinviewofthecircumstances.
Theoutcomeformsthebasisfortheopiniononthecarryingvalueofassetsandliabilitiesthatdoesnotemergeclearlyfromothersources.Theactualoutcomesmaydeviatefromtheseestimates.
Notes to the Buma balance sheet and profit and loss account
19 Financial Statements 2006table of content
(EUR x 1,000)
business information system
Actualcostasat1January2006 5,454Cumulativeinvestmentcosts -3,391balance sheet value as at 1 January 2006 2,063Change during financial year:Investments 989Amortisation -75Investmentcosts -2,063 -1,149Actualcostasat31December2006 6,443Cumulativeamortisation -75Cumulativeinvestmentcosts -5,454balance sheet value as at 31 December 2006 914Amortisationinnumberofyearsonaverage: 3
Theintangibleassetsconcerntheexpenseforthenewbusinessinfor-mationsystemtosupporttheprimarybusinessprocesses.ItconsistsofabasicinvestmentofEUR5.5million,whichhasbeenchargedtotheprofitandlossaccountoveraperiodofthreeyearsfrom2004untiltheendof2006.Intheautumnof2006,afurtherinvestmentofEUR1.0millionwasmadeintheonlineenvironmenttoincreaseeffi-ciencyandmaintaincostleadershipforthebenefitofourrightownersbothathomeandabroad.Thisinvestmentistobeamortisedusingthestraight-linemethodoveraperiodofthreeyearsstartingfromthelastquarterof2006.
TheinvestmentcostsaccountedforinthestatementofmovementsarepartlychargedonastheassetsinquestionareusedbyStemra.
Notes to the Buma balance sheet as at 31 December 2006
(1) Intangible fixed assets The changes in the intangible fixed assets can be specified as follows:
20 Buma/Stemratable of content
(2) tangible fixed assets The changes in the tangible fixed assets can be specified as follows: (EUR x 1,000)
Hardware/ other total
computer equipment operating assets
Actualcostasat1January2006 1,570 5,156 6,726Cumulativedepreciation -1,051 -3,721 -4,772balance sheet value as at 1 January 2006 519 1,435 1,954 Changes during financial year: Investments 268 8 276Depreciation -355 -585 -940Disposals -160 - -160Depreciationofdisposals 152 - 152 -95 -577 -672 Actualcostasat31December2006 1,678 5,164 6,842Cumulativedepreciation -1,254 -4,306 -5,560 balance sheet value as at 31 December 2006 424 858 1,282 Depreciationinnumberofyearsonaverage: 3 7
ThedepreciationaccountedforinthestatementofmovementsispartlychargedonastheassetsinquestionareusedbyStemraorsub-tenants.TheamountschargedontoStemraandthesub-tenantsareEUR0.2millionandEUR0.2millionrespectively.
Notes to the Buma balance sheet as at 31 December 2006
21 Financial Statements 2006table of content
(3) financial fixed assets The changes in the financial fixed assets can be specified as follows: (EUR x 1,000)
Securities Participating total
interests balance sheet value as at 1 January 2006 180,089 -232 179,857 Changes during the financial year: Acquisitions 120,468 - 120,468Repayments/sales -129,534 - -129,534Pricemovements 2,915 - 2,915Resultofparticipatinginterests - -317 -317 -6,151 -317 -6,468
balance sheet value as at 31 December 2006 173,938 -549 173,389
SharesandbondsofVerenigingBumaarecarriedatmarketvalue.Theresultsonsharesarestatedatastandardreturn,whichwas6.3%for2006(2005:5.6%)Valuationdifferencesonbondsandsharesarechargedorcreditedtotherevaluationreserveforfinancialfixedassets.
ThetotalfacevalueofthebondsamountedtoEUR110.3mil-lion(2005:EUR112.8million)comparedtoamarketvalueofEUR112.3million(2005:EUR117.9million).
TheparticipatinginterestsareStichtingBuma/Stemraprojectsinformation,whicharestatedatnetassetvalue.
Buma’ssecuritieshavebeenplacedinStichtingBumaStemraObliga-tiefonds[BumaStemraBondsFundFoundation]andStichtingBumaStemraAandelenfonds[BumaStemraEquityFund].ThefoundationsareproportionallyconsolidatedinBuma’sfinancialstatementsatanaveragerateof64.1%(2005:63.9%).
TheparticipationsgiveVerenigingBumaa68.1%interestinStichtingBumaStemraAandelenfonds[BumaStemraEquityFundFoundation][BumaStemraEquityFund](2005:68.0%)anda62.0%interestinStichtingBumaStemraObligatiefonds[BumaStemraBondFundFoundation](2005:62.0%)atyear-end2006.
Notes to the Buma balance sheet as at 31 December 2006
22 Buma/Stemratable of content
Notes to the Buma balance sheet as at 31 December 2006
31 December 2006 31 December 2005
Assets fixed assets Financialfixedassets 271,748 281,751 other assets 42,241 18,775 313,989 300,526 Liabilities Participants account Participants,includingcurrentaccountwithparticipants 334,734 322,660Overallrevaluationreserve -21,133 -22,500 313,601 300,160current liabilities Creditors 388 366 313,989 300,526
(5) other receivables and prepayments (EUR x 1,000)
31 December 2006 31 December 2005
Cablefeesdue 4,379 4,301Interestdue 2,813 2,898Otherreceivablesandprepayments 1,134 991 8,326 8,190
financial fixed assets (continued) Thefully-combinedfinancialstatementsofStichting buma Stemra obligatiefonds (bSo) [buma Stemra bond fund foundation]andStichting buma Stemra aandelenfonds (bSa) [buma Stemra equity fund foundation] canberepresentedincondensedformasfollows:(EUR x 1,000)
(4) current account balancesThecurrentaccountwithStemraincludesaloanofEUR6.6millionfromBumatoStemra.ThisloanissubjecttotheEuribor3-monthrate.Thetermoftheloanisthreemonthsfromthecommencementdateoftheloanagreement.
(6) cash at bank and in handAllthecashatbankandinhandisfreelyavailable.
23 Financial Statements 2006table of content
Funds
Notes to the Buma balance sheet as at 31 December 2006
(7) fundsThe changes in the funds can be specified as follows:(EUR x 1,000)
balance as at additions Withdrawals balance as at
1 January 2006 2006 2006 31 December 2006
Continuityfund 4,457 - - 4,457Fundforculturalandsocialpurposes 9,403 10,596 -7,867 12,132 13,860 10,596 -7,867 16,589
balance as at additions Withdrawals balance as at
1 January 2005 2005 2005 31 December 2005
Continuityfund 4,457 - - 4,457Fundforculturalandsocialpurposes 4,417 10,233 -5,247 9,403 8,874 10,233 -5,247 13,860
continuity fundThecontinuityfund’saimsincludeguaranteeingthecontinuityofthework.Italsoservestofulfilobligationsinrespectofthirdparties,inparticularwithregardtodistributionoftheroyaltiesyettobedistribu-tedinaccordancewiththefinancialstatements.
Thisfundfurthermoreservestoleveloutunwantedfluctuationsintheamountsavailablefordistribution,resulting,amongotherthings,fromdomesticandinternationalpressureonturnover,aswellascontinuingchangesinthedistributionofrights.
fund for cultural and social purposes Forthebenefitofthisfund,inaccordancewithArticle29,paragraph3oftheArticlesofAssociation,eachyearapercentagedefinedbythemanagementboardontherecommendationoftheboardofdirec-tors,withamaximumof10%,isdeductedfromtheDutchroyaltiesavailablefordistribution.Theamountsdeductedarereservedbythemanagementboardforpaymentstoinstitutionsororganisationswhosepurposeistorepresenttheidealisticormaterialinterestsofcomposers,lyricistsandmusicpublishers,orwhootherwisepromoteDutchmusic.
24 Buma/Stemratable of content
Provision for annual Sfb allowanceTheprovisionforannualSFBallowancesconcernsaprovisionfortheactualobligationsbyvirtueoftheannualallowancespaidto(former)authorsandpublishersandtheirnextofkinthroughtheStichtingSociaalFondsBuma(SFB)[BumaSocialFundFoundation].Althoughtheobligationshavebeenincludedprovisionally,thereisafirminten-tiontomeettheobligations.Thepartoftheprovisionforwhichnosub-sidyhasbeencommittedtotheSFBasyetisrecognised.Theexpectedremainingtermoftheprovisionisuntiltheendof2022,andithasbeencalculatedonthebasisofthenominalamountsoftheannualallowanceswithnon-actuarialassumptionswithregardtoindexingandlifeexpec-tancy.TheprovisionwasformedfromtheFundforculturalandsocialpurposes;releasesarepartofthedeductionsandtakentotheFund.
Provision for optimisation of operationsTheinternationalchangeswithregardtomusicuseandtheresultingallocatedfundsrequireanadjustmentoftheorganisationinordertooptimisethelevelofserviceprovidedinlinewithdomesticallyandinternationallyacceptedstandardsandcompetitiverelationships.
Duringthefinancialyearwithdrawalsweremadeforthestreamliningoftheorganisation,whichstartedin2003.ThismainlyconcernsinitialcostsofexternalITstaffandstaffredundancycosts.
Provision for obligation to indemnifyAsapartytotheagreementsconcludedwithcableoperatorsconcer-ningcopyrightarrangementsforrelayingprogrammesfrombroad-castingcompanies,Bumahasundertakenobligationswithregardtocopyrightclaimsthatcouldbeenforcedagainstcableoperatorsbythirdparties,notrepresentedinthematterbyBuma.
Inrespectofobligationstoindemnifyarisingfromtheseagreements,theprovisionforobligationstoindemnifyamountsto3%ofthemoneyscollected.Theaddition/withdrawaltakesplacetothedebit/creditofthecollection.
(8) Revaluation reserve for financial fixed assetsThe changes in the revaluation reserve financial fixed assets can be specified as follows:(EUR x 1,000)
2006 2005
balance as at 1 January 13,132 4,560 Transactionresultandrevaluation 2,915 10,174Withdrawaltothecreditofthefinancialresulttostandardreturn -1,572 -1,602 1,343 8,572 balance as at 31 December 14,475 13,132
(9) Provisions The changes in the provisions can be specified as follows: (EUR x 1,000)
balance as at additions Withdrawals balance as at
1 January 2006 2006 2006 31 December 2006
AnnualallowanceforSFBscheme 15,874 - -1,391 14,483Optimisationofoperations 1,140 - -662 478Indemnificationobligation 468 493 -467 494 17,482 493 -2,520 15,455
Notes to the Buma balance sheet as at 31 December 2006
25 Financial Statements 2006table of content
Notes to the Buma balance sheet as at 31 December 2006
(10) Royalties to be distributed(EUR x 1,000)
2006 2005
Royaltiestobedistributedatthebeginningoftheyear 128,614 126,012Royaltiesturnover 119,972 113,575AdditiontoFundforculturalandsocialpurposes -10,596 -10,233Changesintheroyaltiestobedistributed -2,552 -2,965 available for distribution 235,438 226,389 Distributed in the reporting year: Affiliatesandmembers 54,962 55,600Foreignorganisations 42,021 40,440Miscellaneousincome 1,657 1,735 98,640 97,775 Royalties to be distributed at the end of the year 136,798 128,614
AnamountofEUR4.2millioninindivisiblerightswillbeaddedtotheavailableamountfordistribution,tobeincludedinthe2007payment(2005:EUR4.2million,includedinthe2006payment).
available for distribution by buma (EUR x 1,000)
2006 2005
Royaltiesturnover 119,972 113,575Indivisiblerights 4,158 4,204Changesinroyaltiestobedistributed -2,552 -2,965 became available for distribution during the year 121,578 114,814 Tobedistributedatthebeginningoftheyear 128,614 126,012Available* 117,420 110,610Distributed -98,640 -97,775Fundforculturalandsocialpurposes -10,596 -10,233 Royalties to be distributed at the end of the year 136,798 128,614 *Excludingindivisiblerightswhichhavealreadybeenaccountedforintheopeningbalancesheet.
26 Buma/Stemratable of content
*Theturnovercategorieswereredefinedduringthereportingyear.Thefiguresfortheyear2005havethereforebeenadjustedforcompa-risonpurposes
Notes to the Buma balance sheet as at 31 December 2006
Distribution of turnover buma (EUR x 1,000)
2006 2005* Radio&TVPerformingRights 42,286 41,981Stage 18,354 15,499Catering 15,431 14,582Workplaces 12,620 11,853SalesOutlets 10,605 9,935PerformingRightsOnlineLicensing 564 331Cable 11,387 11,110PerformingRightsabroad 8,725 8,284 119,972 113,575
The amount available for distribution (including addition for indivisible rights) is allocated to the different categories as followings:(EUR x 1,000)
2006 2005
Liveentertainment 16,488 12,156Entertainmentmechanical 31,499 31,281Radio 5,719 5,791Television 6,844 6,955Film 1,662 1,838Seriouscategories 3,313 2,466Cable 10,444 10,160Satellite 26,288 25,650International 8,725 8,284Fundforculturalandsocialpurposes 10,596 10,233 121,578 114,814
27 Financial Statements 2006table of content
Distribution of turnover buma (EUR x 1,000)
2006 2005* Radio&TVPerformingRights 42,286 41,981Stage 18,354 15,499Catering 15,431 14,582Workplaces 12,620 11,853SalesOutlets 10,605 9,935PerformingRightsOnlineLicensing 564 331Cable 11,387 11,110PerformingRightsabroad 8,725 8,284 119,972 113,575
Notes to the Buma balance sheet as at 31 December 2006
off-balance sheet commitmentsInaccordancewiththedecisionofthemanagementboard,attheendof2002partofthebondportfolioofStichtingBumaStemraObligatiefonds[BumaStemraEquityFundFoundation]amountingtoEUR27.5millionwaspledgedassecuritytoINGBankinconnectionwithacashfacilityneededfornormaloperations.
ThefinancialliabilitywithregardtothebusinessaccommodationinHoofddorpwasassumeduntil1August2011.TheannualrentforBuma/StemratogetheramountstoapproximatelyEUR1.8million.Thisdoesnottakeintoaccountsublettingtothirdparties.
Furthermore,therearejointmulti-yearliabilitiesfortherentalofXeroxprintingequipmentamountingtoEUR0.1millionayear.Inthecurrentcomposition,theannualamountfortheleasingofcarsbyBuma/StemraisEUR0.2million.
Theoff-balancesheetrentalandleaseobligationsofEUR8.7millioncanbesummarisedasfollows:•lessthan1year:EUR2.1million.•between1and5years:EUR6.6million.•longerthan5years:nil
(11) current account formulas (EUR x 1,000)
31 December 2006 31 December 2005
Affiliatedsocietiesabroad 24,511 24,064Subsidyobligations 9,969 10,205Bumamembers 600 324Other 1,950 1,887 37,030 36,480
Theamountsowedtoaffiliatedsocietiesabroadwerelargelysettledatthebeginningof2007.Thesubsidyobligationsconcernsubsidiesthathavebeenpromisedtovariousfoundationsforsocialandculturalpurposes.
(12) other liabilities and accruals (EUR x 1,000)
31 December 2006 31 December 2005
Third-partycablerightowners 1,308 4,357Holidayallowance/annualleave 812 724Otherliabilitiesandaccruals 847 354 2,967 5,435
Witheffectfromthereportingyear,theamountsowedtothird-partycablerightownersaretobesettledafterthequarter.Inpreviousyears,thistookplaceonceayear,namelyintheyearfollowingthereportingyear.
28 Buma/Stemratable of content
Notes to the Buma profit and loss account as at 31 December 2006Expenses
(13) Personnel expenses (EUR x 1,000)
2006 2005*
Salaries 8,303 8,459Socialsecuritycontributions 1,033 1,012Pensionpremiums 800 878Otherstaffcosts 3,941 3,555 14,077 13,904 Chargedtothirdparties -5,128 -5,224 8,949 8,680
(14) Financial result (EUR x 1,000)
2006 2005
Interest income and other income Fixed-income securities Interestreceivedonbonds 5,279 5,043 Shares Sharedividendreceived 2,349 1,693 Withdrawalsfromrevaluationreserve 1,572 1,602 3,921 3,295Otherinterestincomeandsimilarincome 1,221 843Totalincomefrominvestments 10,421 9,181 Resultofparticipatinginterests -317 -232Interestexpensesandothercosts -712 -549
9,392 8,400
*adjustedforcomparisonpurposes.
Theaveragenumberofemployeesduringthereportingyearwas197(2005:198employees),whichcorrespondstoanaverageof179.8FTEs(2005:177.2FTEs).ThisincludesemployeeswhoworkpartlyforStemra,onthebasisofwhichpartofthecostsarechargedontoStemra.Bumaemploysafurther4.5FTEs,whicharechargedtootheraffiliatedfoundations.
29 Financial Statements 2006table of content
to: the board of directors and the general assembly of Vereniging buma (buma association) Auditor’s report
Wehaveauditedtheaccompanyingfinancialstatements2006ofVerenigingBuma,Hoofddorp,whichcomprisethebalancesheetasat31December2006,theprofitandlossaccountfortheyearthenendedandthenotes.
Responsibility of the board of directors Theboardofdirectorsisresponsibleforthepreparationofthefinancialstatementsinaccordancewithprinciplesselectedanddisclosedbytheentity.Thisresponsibilityincludes:designing,implementingandmaintaininginternalcontrolrelevanttothepreparationofthefinancialstatementsthatarefreefrommaterialmisstatement,whetherduetofraudorerror;selectingandapplyingappropriateaccountingpolicies;andmakingaccountingestimatesthatarereasonableinthecircumstances.
auditor’s responsibility Ourresponsibilityistoexpressanopiniononthefinancialstatementsbasedonouraudit.WeconductedourauditinaccordancewithDutchlaw.Thislawrequiresthatwecomplywithethicalrequirementsandplanandperformtheaudittoobtainreasonableassurancewhetherthefinancialstatementsarefreefrommaterialmisstatement.Anauditinvolvesperformingprocedurestoobtainauditevidenceabouttheamountsanddisclosuresinthefinancialstatements.Theproceduresselecteddependontheauditor’sjudgment,includingtheassessmentoftherisksofmaterialmisstatementofthefinancialstatements,whetherduetofraudorerror.Inmakingthoseriskassessments,theauditorcon-sidersinternalcontrolrelevanttotheentity’spreparationofthefinan-cialstatementsinordertodesignauditproceduresthatareappropriateinthecircumstances,butnotforthepurposeofexpressinganopinionontheeffectivenessoftheentity’sinternalcontrol.Anauditalsoinclu-desevaluatingtheappropriatenessofaccountingpoliciesusedandthereasonablenessofaccountingestimatesmadebymanagement,aswellasevaluatingtheoverallpresentationofthefinancialstatements.Webelievethattheauditevidencewehaveobtainedissufficientandappropriatetoprovideabasisforourauditopinion.
opinionInouropinion,thefinancialstatements2006ofVerenigingBuma,includingthedistributionofthereceivedcopyrightsover2006,areprepared,inallmaterialaspects,inaccordancewithprinciplesselec-tedanddisclosedbytheentity,asdefinedinthenotesofthefinancialstatements.
Amstelveen,4April2007KPMGACCOUNTANTSN.V.R.J.GrootRA
Other information
table of content30 Buma/Stemra
Profit appropriationForBuma,theresultfor2006willbedeductedfromtheroyaltiestobedistributed.Then,accordingtotheassessmentofthecontinuityfundandtherevaluationreserve,itwillbedeterminedtowhatextentfundswillhavetobeaddedtoordeductedfromthis.Thismovementwillalsobecreditedorchargedtotheroyaltiestobedistributed.
Asaresultofthisassessmentofthecontinuityfundandtherevaluationreserve,noaddition/withdrawalistotakeplace,aswasthecasein2005.AtotalofEUR2.6millionwillthereforebedeductedfor2006fromthecopyrightsasyettobepaidout(2005:alossofEUR3.0million).
ProposaloftheboardofdirectorsAsshowninthefinancialstatements,drawnupbyusinaccordancewithArticle26,paragraph2oftheArticlesofAssociation,theboardofdirectorsproposesthedeductionofthenegativeresultofEUR2.6millionfromtheroyaltiestobedistributed.Theproposalhasalreadybeenincorporatedinthe2006financialstatements.
table of content
Financial statements for 2006Stemra
table of content
32 Buma/Stemratable of content
Stemra balance sheet as at 31 December 2006
Stemra balance sheet as at 31 December 2006After profit appropriation (EUR x 1,000)
31 December 2006 31 December 2005
Assets Fixed assets tangible fixed assets (1) Hardware/Computerequipment 221 190 221 190 financial fixed assets (2) Securitiesandprivateloans 97,809 101,663 Participatinginterests -549 -233 97,260 101,430Current assets accounts receivable Debtors 6,647 7,499 Taxesandsocialsecuritycontributions 2,197 1,092 Otherreceivablesandprepayments(3) 1,618 1,758 10,462 10,349cash at bank and in hand (4) Depositaccounts 9,565 4,478 Otherliquidassets 1,137 1,366 10,702 5,844
118,645 117,813 Liabilities foundation capital 1 1 continuity fund (5) 10,390 10,390 Revaluation reserve financial fixed assets (6) 10,672 10,647 21,063 21,038Provisions (7) 558 1,150 21,621 22,188current liabilities Royaltiestobedistributed(8) 51,332 56,513 Debtstocreditinstitutions 13,000 3,000 Creditors 1,084 2,559 Currentaccountbalances(9) 12,235 14,609 Otheraccrualsanddeferredincome(10) 19,373 18,944 97,024 95,625
118,645 117,813
33 Financial Statements 2006table of content
Stemra profit and loss account for 2006 (EUR x 1,000)
2006 2005*
Income Administrativecostscharged 4,778 4,389 Entrancefeesandannualallowances 456 495 Miscellaneousincome 14 32 5,248 4,916 Expense
Personnelcosts(11) 5,718 5,774 Accommodationcosts 740 712 Depreciationandamortisationcosts 395 365 Investmentcosts 604 729 Othercosts 2,195 1,716 9,652 9,296 Operatingloss -4,404 -4,380 Financialresult(12) 4,325 4,226 Result -79 -154
*adjustedforcomparisonpurposes.
Stemra profit and loss account for 2006
34 Buma/Stemratable of content
Stemra cash flow statement(EUR x 1,000)
2006 2005
cash flow from operating activities Turnover 48,421 53,455Distribution -53,523 -48,562Operatingloss -4,404 -4,380Depreciationandamortisation 395 365Depreciationandamortisationchargedon -267 -257Withdrawalfromprovisions -592 -689Resultofparticipatinginterests 316 233Changesinaccountsreceivable(excl.interesttobereceived) -253 -1,487 Changesincurrentliabilities(excl.royaltiestobedistributed) -3,420 3,376 -3,673 1,889
Cashflowfromoperatingactivities -13,327 2,054 Interestreceivedonsecurities 4,540 4,273 Interestpaidonsecurities -812 -551 3,728 3,722
Cashflowsfromoperationalactivities -9,599 5,776 cash flow from investing activities Investmentsintangiblefixedassets -159 -159 Disposalofparticipatinginterests - 229 Cashflowfromsecuritiestrading -159 70 cash flow from securities trading Purchaseofsecurities -62,958 -50,141 Repayments/sales 67,574 46,404 Cashflowfromsecuritiestrading 4,616 -3,737 changes in cash at bank and in hand and debts to credit institutions -5,142 2,109
Stemra cash flow statement
35 Financial Statements 2006table of content
General
objective of Stichting StemraTheFoundation’sobjectiveistorepresentandpromoteboththetangibleandnon-tangibleinterestsofmusicauthorsandpublishersandothercopyrightowners,inparticularwithregardtomechanicalreproductionrights.TheFoundation’sothergoalsareexercisingandmaintainingmechanicalreproductionrightsforparticipatingauthors,participatingpublishers,aswellasotherauthorsandcopyrightowners.TheFoundationparticipatesintheimplementationandpromotionofvariousactivitiesinthiscontextforthepurposeofthisobjective.
accounting policies for the valuation of assets and liabilities and determination of resultGeneralThepoliciesusedforthevaluationofassetsandliabilitiesandthedeterminationoftheresultarebasedonhistoricalcost.Unlessstatedotherwise,assetsandliabilitiesarestatedatfacevalue.Theincomeandexpensesareallocatedtotheperiodtowhichtheyapply.
Whereapplicable,thefiguresforthepreviousfinancialyearhavebeenadjustedtofacilitatecomparisonswith2006.
accounting policies for the conversion of foreign currencyTransactionsinforeigncurrenciesareconvertedtoeurosattheapplicableexchangerateonthetransactiondate.Monetaryassetsandliabilitiesareconvertedtoeurosatbalancesheetdateattheexchangerateapplicableonthatdate.Exchangeratedifferencesoccurringduringconversionaretakentotheprofitandlossaccount.Non-monetaryassetsandliabilitiesinforeigncurrencythatarevaluedonthebasisofhistoricalcostsareconvertedattheexchangerateapplicableonthetransactiondate.
Principles of consolidationInviewofthetransparentstructure,theStichtingBumaStemraObligatiefonds[BumaStemraBondFundFoundation]andStichtingBumaStemraAandelenfonds[BumaStemraEquityFundFoundation]areconsolidatedproportionallyintheBumafinancialstatements.Assetsandliabilities,aswellasincomeandexpense,areincludedinproportionoftheparticipatinginterest.Onthebasisoftheinformationprovidedinthenotes,noseparatecompanyfinancialstatementsareincludedforStemra.
tangible fixed assetsThevaluationoftangiblefixedassetstakesplaceonthebasisofhistori-calcostlesscumulativedepreciation.
Depreciationiscalculatedasapercentageofthepurchasepriceaccor-dingtothestraight-linemethodonthebasisoftheexpectedusefullife.
Thefollowingexpectedusefullivesareused:•Hardware/Computerequipment3years
financial fixed assetsBondsandsharesarestatedatmarketvalue.Valueadjustmentsareincorporateddirectlyintotherevaluationreserve.Thispreventstheoperatingresultfrombeinginfluencedtoostronglybypricefluctua-tions.Iftherevaluationreserveisinsufficient,thereductionsinvaluearechargedtotheresult.Eachyear,thesizeoftherevaluationreserveneededtoabsorbthesepricefluctuationsisdeterminedbytheboardofdirectorsinconsultationwithitsassetmanagers.Iftherevaluationreserveislargerthandeemednecessary,thesurplusiseligibleforadditiontotheroyaltiestobedistributed.Withregardtotheresultforshares,astandardreturnisenteredifpossible.
Participating interestsParticipatinginterestsarecapitalinterestsinwhichsignificantinfluenceisexercisedonthebusinessandfinancialpolicy.Participatinginterestsarestatedatnetassetvalue.
Standard return Thestandardreturniscalculatedasapercentageoftheaveragevalueofthesharesoverthefinancialyearandcomprisestheeffectivereturnon5-yearEurogovernmentbondsattheendofthefinancialyearplusariskmark-up.Thedifferencebetweenthestandardreturnandthedividendreceivedonsharesisdeductedfromtherevaluationreserve,ifpossible.
accounts receivableAccountsreceivablearecarriedatfacevaluelessaprovisionforuncollectability.
Notes to the Stemra balance sheet and profit and loss account
36 Buma/Stemratable of content
Determination of the resultIncomeandexpensearerecordedintheyeartowhichtheyapply.Theresultisdeterminedbycalculatingthedifferencebetweentheincomerealisedontheonehand,andthecostsandotherexpensesincurredforoperationfortheyearontheother.Thebalanceoftheprofitandlossaccountandthemovementinthefundsisthereforeaddedto/deductedfromtheroyaltiestobedistributed.
turnoverInthefinancialstatements,turnoverinroyaltiesisaddedtotheroyal-tiestobedistributed.Stemraincludestheexploitationofmechanicalrightsintheturnover,insofarastheserelatetothefinancialyear,canbedeterminedinareliablemannerandthereisreasonablecertaintythattherevenueiscollectible.
taxesWithregardtoStemra,theDutchtaxauthoritiesstipulatedinanagree-mentdated6November2001,determiningthelegalrelationshipbetweentheparties,thatStichtingStemraisliabletopaycorporationtax.Thisagreementisvaliduntil31December2007.Foreignwithholdingtaxavailableforset-offandDutchdividendtaxmaybedeductedfromthetaxduebyvirtueofthisagreementdeterminingthelegalrelationshipbetweenparties.Ataxitemisonlyincludedinthefinancialstatementsifcorporationtaxisstillowedafterdeductionoftheforeignwithholdingtaxavailableforset-off.
accounting policies for cash flow statementThecashflowstatementisdrawnupaccordingtotheindirectmethod.
Use of estimatesDrawingupthefinancialstatementsrequiresthemanagementtoformopinionsandmakeestimatesandassumptionsthatinfluencetheapplicationofpoliciesandthereportedvalueofassetsandliabilities,andofincomeandexpense.
Theestimatesandtheassociatedassumptionsarebasedonpastexperienceandvariousotherfactorsthatareconsideredreasonableinviewofthecircumstances.
Theoutcomeformsthebasisfortheopiniononthecarryingvalueofassetsandliabilitiesthatdoesnotemergeclearlyfromothersources.Theactualoutcomesmaydeviatefromtheseestimates.
Notes to the Stemra balance sheet and profit and loss account
37 Financial Statements 2006table of content
(1) tangible fixed assets The changes in the tangible fixed assets can be specified as follows:(EUR x 1,000)
Hardware/
computer equipment
Actualcostasat1January2006 709Cumulativedepreciation -519balance sheet value as at 1 January 2006 190Changes during financial year:Investments 159Depreciation -128 31Actualcostasat31December2006 868Cumulativedepreciation -647balance sheet value as at 31 December 2006 221
Thedepreciationcostsaretakentotheprofitandlossaccount,includingdepreciationofEUR0.2millionchargedonbyBumafortheuseofBumaassetsbyStemra.
Notes to the Stemra balance sheet as at 31 December 2006
38 Buma/Stemratable of content
(2) financial fixed assets The changes in the financial fixed assets can be specified as follows: (EUR x 1,000)
Securities Participating total
interests
balance sheet value as at 1 January 2006 101,663 -233 101,430 Changes during the financial year: Acquisitions 62,958 - 62,958Repayments/sales -67,574 - -67,574Pricemovements 762 - 762Resultofparticipatinginterests - -316 -316 -3,854 -316 -4,170 balance sheet value as at 31 December 2006 97,809 -549 97,260
Notes to the Stemra balance sheet as at 31 December 2006
BondsandsharesofStichtingStemraareaccountedforatmarketvalue.Theresultsonsharesarestatedatastandardreturn,whichis6.3%for2006(2005:5.6%).Valuedifferencesonbondsandsharesarechargedorcreditedtotherevaluationreserveforfinancialfixedassets.
ThetotalfacevalueofthebondsamountedtoEUR67.7million(2005:EUR69.2million)comparedtoamarketvalueofEUR68.9million(2005:EUR72.3million).
TheparticipatinginterestsareStichtingBuma/Stemraprojectsinformation,whichareincludedatnetassetvalue.Stemra’ssecuritieshavebeenplacedinStichtingBumaStemraObligatiefonds[BumaStemraBondFundFoundation]andStichtingBumaStemraAandelenfonds[BumaStemraEquityFundFoundation].ThefoundationsareproportionallyconsolidatedinStemra’sfinancialstatementsatanaverageof35.9%(2005:36.1%).TheparticipationsgaveStichtingStemraa31.9%interestinStichtingBumaStemraAandelenfonds[BumaStemraEquityFundFoundation](2005:32.0%)anda38.0%interestinStichtingBumaStemraObligatiefonds[BumaStemraBondFundFoundation](2005:38.0%)atyear-end2006.
39 Financial Statements 2006table of content
Notes to Stemra balance sheet as at 31 December 2006
financial fixed assets (continued)ThefullcombinedfinancialstatementsofStichtingBumaStemraObligatiefonds(BSO)[BumaStemraBondFundFoundation]andStichtingBumaStemraAandelenfonds(BSA)[BumaStemraEquityFundFoundation]canbepresentedincondensedformasfollows:(EUR x 1,000)
31 December 2006 31 December 2005
Assets fixed assets Financialfixedassets 271,748 281,751 other assets 42,241 18,775 313,989 300,526 Liabilities Participants accounts Participantsincludingcurrentaccountwithparticipants 334,734 322,660Overallrevaluationreserve -21,133 -22,500 313,601 300,160current liabilities Creditors 388 366 313,989 300,526
(3) other accruals and deferred income (EUR x 1,000)
31 December 2006 31 December 2005
Interesttobereceived 1,618 1,758
(4) cash at bank and in handAllthecashatbankandinhandisfreelyavailable.
40 Buma/Stemratable of content
(5) fundsThe changes in the continuity fund can be specified as follows:(EUR x 1,000)
balance as at additions Withdrawals balance as at
1 January 2006 2006 2006 31 December 2006
Continuityfund 10,390 - - 10,390
(6) Revaluation reserve financial fixed assetsThe changes in the revaluation reserve for financial fixed assets can be specified as follows:(EUR x 1,000)
2006 2005
balance as at 1 January 10,647 6,807 Transactionresultandrevaluation 762 4,595Withdrawaltothecreditofthefinancialresulttostandard -737 -755 25 3,840 balance as at 31 December 10,672 10,647
(7) Provisions Changes in the provisions can be specified as follows:
(EUR x 1,000)
balance as at additions Withdrawals balance as at
1 januari 2006 2006 2006 31 december 2006
Optimisationofoperations 1,150 - -592 558
Provision for optimisation of operationsTheinternationalchangeswithregardtothelicensingofmechanicalreproductionrightsandtheresultingallocatedfundsrequireinparticularanadjustmentoftheorganisationinordertooptimisetheservicesprovidedinaccordancewithdomesticandinternationallyacceptedstandardsandcompetitiveconditions.
Duringthefinancialyear,withdrawalsweremadeforstreamliningtheorganisation,whichstartedin2003.ThismainlyconcernsinitialcostsofexternalITstaffandstaffredundancy.
Notes to the Stemra balance sheet as at 31 December 2006
Funds
continuity fund Thecontinuityfund’saimsincludeguaranteeingthecontinuityofthework.Italsoservestofulfilobligationsinrespectofthirdparties,inparticularwithregardtotheroyaltiesyettobedistributedaccordingtothefinancialstate-ments.
Thisfundfurthermoreservestoleveloutunwantedfluctuationsintheamountsavailablefordistribution,resultingamongotherthingsfromdomesticandinternationalpressureonturnover,aswellascontinuingchangesinthedistributionofrights.
41 Financial Statements 2006table of content
(8) Royalties to be distributed (EUR x 1,000)
2006 2005
Royaltiestobedistributedatthebeginningoftheyear 56,513 51,774Turnoverroyalties 48,421 53,455Changesintheroyaltiestobedistributed -79 -154 available for distribution 104,855 105,075 Distributed in the financial year: Affiliatesandmembers 40,318 34,871Foreignorganisations 7,168 8,347CentralLicensing 1,259 955AdministrativecostswithheldintheNetherlands 4,518 4,182Administrativecostswithheldabroad 260 207 53,523 48,562 Royalties to be distributed at the end of the year 51,332 56,513
available for distribution by Stemra (EUR x 1,000)
2006 2005
Turnoverroyalties 48,421 53,455Indivisiblerights 2,002 2,351Changesinroyaltiestobedistributed -79 -154
became available for distribution during the year 50,344 55,652 Tobedistributedatthebeginningoftheyear 56,513 51,774Available* 48,342 53,301Distributed -53,523 -48,562 Royalties to be distributed at the end of the year 51,332 56,513
*Excludingindivisiblerightswhichhavealreadybeenaccountedforintheopeningbalancesheet.
Notes to the Stemra balance sheet as at 31 December 2006
42 Buma/Stemratable of content
Distribution of Stemra turnover (EUR x 1,000)
2006 2005*
BiemPhonomechanicalrights/CentralLicensing 23,917 25,859SpecialLicensing/PrivateLabels 7,064 9,540Radio&TVMechanicalRights 6,124 7,430MechanicalRightsOnlineLicensing 1,081 827HomeCopy/LendingRights 4,727 5,093MechanicalRightsAbroad 5,508 4,706 48,421 53,455
*Theturnovercategorieswereredefinedduringthereportingyear.Thefiguresfor2005havethereforebeenadjustedforcomparisonpurposes.
(9) current account balances (EUR x 1,000)
31 December 2006 31 December 2005
Affiliatedsocietiesabroad 4,407 5,628Bumacurrentaccount 7,828 8,981
12,235 14,609
Notes to the Stemra balance sheet as at 31 December 2006
Theamountsowedtoaffiliatedsocietiesabroadwerelargelysettledatthebeginningof2007.ThecurrentaccountbalancewithBumaincludesaloanofEUR6.6millionfromBumatoStemra.ThisloanissubjecttotheEuribor3-monthrate.Thetermoftheloanisthreemonthsfromthecommencementdateoftheloanagreement.
43 Financial Statements 2006table of content
(10) other liabilities and accruals (EUR x 1,000)
31 December 2006 31 December 2005
AdvancestoDutchIndustry 17,790 17,834Tobeoffsetwithindustryandprivatelabels 175 110Holidayallowance/annualleave 265 213Otherliabilitiesandaccruals 1,143 787
19,373 18,944
advances to Dutch industryThisincludestheinvoicedadvancesonreproductionrightstobesettledbytheDutchindustryforperiodsuptotheendof2006.Whenthesettlementsarereceivedfromtheseproducers,theseadvancesaredeductedfromtheroyaltiestobereceived.
off-balance sheet commitmentsInaccordancewiththedecisionofthemanagementboard,attheendof2002partofthebondportfolioamountingtoEUR27.5millionwaspledgedassecuritytoINGBankinconnectionwithacashfacilityneededfornormaloperations.
ThefinancialliabilitywithregardtothebusinessaccommodationinHoofddorpwasassumeduntil1August2011.TheannualrentforBuma/StemratogetheramountstoapproximatelyEUR1.8million.Thisdoesnottakeintoaccountsublettingtothirdparties.
Furthermore,therearejointmulti-yearobligationsforBuma/StemrafortherentalofXeroxprintingequipmentamountingtoEUR0.1millionayear.Inthecurrentcomposition,theannualamountforleasingofcarsisEUR0.2million.
Theoff-balancesheetrentalandleaseobligationsofEUR10.5millioncanbespecifiedasfollows:•llessthan1year:EUR2.1million•between1and5years:EUR6.6million•longerthan5years:nil
Notes to the Stemra balance sheet as at 31 December 2006
44 Buma/Stemratable of content
Liabilities
(11) Personnel expenses (EUR x 1,000)
2006 2005*
Salaries 1,941 1,937Socialsecuritycontributions 260 251Pensionpremiums 183 177Otherstaffcosts 109 228 2,493 2,593 ReimbursedtoBumainrespectofshareddepartments 4,275 4,074 6,768 6,667Allocatedtothirdparties -1,050 -893 5,718 5,774
Notes to the Stemra profit and loss account as at 31 December 2006
Theaveragenumberofemployeesduringthereportingyearwas39(2005:44employees),whichcorrespondstoanaverageof33.3FTEs(2005:37.4FTEs).ThisdoesnotincludeemployeeschargedonviaBuma.Stemraemploysafurther12.3FTEs,whicharechargedtootheraffiliatedfoundations.
(12) Financial result (EUR x 1,000)
2006 2005
Interest income and other income Fixed-income securities Interestreceivedonbonds 3,239 3,093 Shares Sharedividendreceived 1,101 799 Withdrawalsfromrevaluationreserve 737 755 1,838 1,554Otherinterestincomeandsimilarincome 376 363Totalincomefrominvestments 5,453 5,010
Resultofparticipatinginterests -316 -233Interestexpensesandothercosts -812 -551 4,325 4,226
*adjustedforcomparisonpurposes.
45 Financial Statements 2006table of content
to: the board of directors and the general assembly of Stichting Stemra (Stemra foundation)
Auditor’s report
Wehaveauditedtheaccompanyingfinancialstatements2006ofStichtingStemra,Hoofddorp,whichcomprisethebalancesheetasat31December2006,theprofitandlossaccountfortheyearthenendedandthenotes.
Responsibility of the board of directors Theboardofdirectorsisresponsibleforthepreparationofthefinancialstatementsinaccordancewithprinciplesselectedanddisclosedbytheentity.Thisresponsibilityincludes:designing,implementingandmain-taininginternalcontrolrelevanttothepreparationofthefinancialstate-mentsthatarefreefrommaterialmisstatement,whetherduetofraudorerror;selectingandapplyingappropriateaccountingpolicies;andmakingaccountingestimatesthatarereasonableinthecircumstances.
auditor’s responsibilityOurresponsibilityistoexpressanopiniononthefinancialstatementsbasedonouraudit.WeconductedourauditinaccordancewithDutchlaw.Thislawrequiresthatwecomplywithethicalrequirementsandplanandperformtheaudittoobtainreasonableassurancewhetherthefinancialstatementsarefreefrommaterialmisstatement.Anauditinvolvesperformingprocedurestoobtainauditevidenceabouttheamountsanddisclosuresinthefinancialstatements.Theproceduresselecteddependontheauditor’sjudgment,includingtheassessmentoftherisksofmaterialmisstatementofthefinancialstatements,whetherduetofraudorerror.Inmakingthoseriskassessments,theauditorconsidersinternalcontrolrelevanttotheentity’spreparationofthefinancialstatementsinordertodesignauditproceduresthatareappropriateinthecircumstances,butnotforthepurposeofexpressinganopinionontheeffectivenessoftheentity’sinternalcontrol.Anauditalsoincludesevaluatingtheappropriatenessofaccountingpoliciesusedandthereasonablenessofaccountingestimatesmadebymanagement,aswellasevaluatingtheoverallpresentationofthefinancialstatements.Webelievethattheauditevidencewehaveobtainedissufficientandappropriatetoprovideabasisforourauditopinion.
opinionInouropinion,thefinancialstatements2006ofStichtingStemra,includingthedistributionofthereceivedcopyrightsover2006,areprepared,inallmaterialaspects,inaccordancewithprinciplesselectedanddisclosedbytheentity,asdefinedinthenotesofthefinancialstatements.
Amstelveen,4April2007
KPMGACCOUNTANTSN.V.R.J.GrootRA
Other information
46 Buma/Stemra
Profit appropriationForStemra,theresultfor2006willbedeductedfromtheroyaltiestobedistributed.Then,accordingtotheassessmentofthecontinuityfund,itwillbedeterminedtowhatextentfundswillhavetobeaddedtoordeductedfromthis.Thismovementwouldalsobecreditedorchargedtotheroyaltiestobedistributed.
Asaresultofthisassessmentofthecontinuityfundandtherevaluationreserve,noaddition/withdrawalistotakeplace,aswasthecasein2005.AtotalofEUR0.1millionwillthereforebedeductedfor2006fromthecopyrightsasyettobepaidout(2005:alossofEUR0.2million).
Proposal of the board of directorsAsshowninthefinancialstatements,drawnupbyusinaccordancewithArticle26,paragraph2oftheArticlesofAssociation,theboardofdirectorsproposesthedeductionofthenegativeresultofEUR0.1millionfromthereservedresultsofpreviousyearsincludedintheroyaltiestobedistributed.Theproposalhasalreadybeenincorporatedinthe2006financialstatements.
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47 Financial Statements 2006table of content
Management board of Vereniging Buma
Dr.K.P.Boehmer,chairmanMr.H.Kosterman, deputy chairmanT.Berk,secretary
Drs.S.A.A.AbdoelbasierMr.E.BoomH.C.M.deClercqP.vanEmpelenM.W.MensinkA.A.SauerC.M.SchramaH.WestbroekA.J.Witte
Composition of management board and managementas at 1 april 2007
Management board of Stichting Stemra
Dr.K.P.Boehmer,chairmanJ.Brands,deputy chairmanP.vanEmpelen,secretary
F.BruensJ.H.GreveltC.vanderHoevenP.C.KoelewijnMr.H.KostermanA.J.KraamerA.deRaaffA.C.M.RuiterA.A.Sauer
Allamountsquotedinthisannualreportareineuro
Management of Buma/Stemra
C.P.Vervoord,chairman of the boardDrs.W.J.Ketellapper, director general affairs departmentDrs.M.Mackay,director Back OfficeMr.C.vanRij,director legal affairs department
Publication
Textcontributions:ErikdeBoerBoardroomFinancialPR
Translation:EnglishServices(Communications)BV
Designandrealisation:LinkDesignBV,Amsterdam
Photography:GettyImages(coverfoto)MatthewNiederberger(photoonpage12/13)LinkDesignBV(fotopag.31)
Printedby:WCdenOudenBV,Amsterdam
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Buma Association/Stemra Foundation
Siriusdreef 22-282132 WT HoofddorpThe Netherlandst +31 (0)23 799 79 99f +31 (0)23 799 77 77e info@bumastemra.nlwww.bumastemra.nl
Office in The HagueLange Voorhout 86-122514 EJ The HagueThe Netherlandst +31 (0)70 310 91 09f +31 (0)70 310 91 00e denhaag@bumastemra.nl
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