147th Annual Report for the year ended 31 March 2016

OFFICE BEARERS 2015-2016

President MB Spencer

Vice President DA Nolan

Past President TGB Powell ED

Trustees and Ex-Officio Members of Committee PH Masfen CNZM, PRJ Gibson, LG Cormack

Committee MB Spencer, Mrs VM Carter ONZM, JG McElhinney, DA Nolan,

SC Leavy, Hon. Justice PJ Davison QC, A J Morris, GC Ganley, Ms JM Bensemann, AK Christie, MS Talbot

Auditor KPMG

General Manager Mrs NJ de Villiers

The Committee is pleased to present the Annual Report, including the financial statements, of The Northern Club for the year ended 31 March 2016.

For and on behalf of the Committee:

MB Spencer DA Nolan President Vice President

NOTICE OF MEETING Notice is given that the Annual Meeting of Members of The Northern Club ("Club") will be held in the Clubhouse on Thursday 26 May 2016 commencing at 6.00pm. At the meeting, Members will be asked to consider the following items of business.

1. Consideration of the Annual Report and Financial Statements for the year ended 31 March 2016.

2. Notice of Motion by the President on behalf of the Committee:

(i) that Messrs Rt Hon. Sir Edmund Thomas KNZM QC, Mr JR Michaels, Mr AC Montgomery,

and Judge BN Morris be elected as Life Members under Rule 28.3. (ii) that the annual subscription for all membership categories be increased by 5% excluding

Overseas members which remains extant

Explanation: Due to the nominal increases in general CPI over the past few years we have withheld increases in subscription fees on an annual basis. As indicated at the AGM in May 2015, it was anticipated a one-off “catch up” increase would be applied this year and, accordingly, the General Committee has proposed that the annual subscription for all membership categories be increased by 5%, excluding Overseas members which will remain extant.

(iii) that the joining fee for Members aged between 35 and 38 (at 1 April) be set at $300

Explanation: The Committee has resolved, subject to approval at this meeting, to move to a flat joining fee of $300 for the 35-38 year old age bracket (at 1 April in any year) meaning that the aggregate effective joining fee is $900, combining the flat joining fee of $300 together with a building levy of $600. This is intended to facilitate younger members to join the Club, which is an objective of the Committee.

(iv) that Rules 19 and 21 be deleted and replaced and Rule 22 be adopted as follows (and the

numbering of subsequent Rules will be updated accordingly):

19. The annual subscription shall be payable, at the option of the member, as follows:

19.1 by half yearly instalments in advance on the first day of April and the first day of October in each year (except in the case of Overseas Members, where it shall be debited annually on the first day of April) provided that a member enrolled after the month of April or October in any half year they shall pay for that half year a rateable proportion of the instalment calculated from the first day of the month in which such member was enrolled until the end of the relevant half year (or year in the case of Overseas Members); or

19.2 by 12 monthly instalments in advance by automatic bank payment on the first day of

each month. Where a member is enrolled after the first day of a particular month,

the first monthly instalment will be made on the first day of the month following the month in which such member enrolled.

21. The entrance fee shall be payable, at the option of the member, as follows:

21.1 in full at the time of acceptance for membership; or

21.2 by 12 equal monthly instalments in advance by automatic bank payment on the first

day of each month. Where a member is enrolled after the first day of a particular month, the first monthly instalment will be made on the first day of the month following the month in which such member enrolled.

22. Any other fee, subscription or levy shall be payable as follows (including where

imposed under Rule 29):

22.1 in the manner determined by the Committee in its absolute discretion, provided that any building levy is to be fully paid within 12 months; or

22.2 as approved at any General Meeting in accordance with Rule 29.

Explanation: The Committee has resolved to allow monthly payments for all fees, including the Entrance Fee and building levy, with an overall aim to achieve more flexibility in the payment of fees, provided that in relation to the Entrance Fee and building levy, these fees must be paid within the first 12 months of membership. The proposed amendment incorporates this fee structure and aims to set out the rules in respect of fees in a more reader-friendly manner.

(v) That a new rule be adopted at the end of the current rules, as rule 94 (subject to any

renumbering consequent on the earlier proposed rule changes), as follows:

94. The Committee in its absolute discretion may award an amount of credit to any new Member as it thinks fit to be applied only to on premises food and beverage consumption which credit:

94.1 must be utilised within 12 months from the date of acceptance of membership of

that Member; and

94.2 will be refundable (as a debt due to the Club) by any Member who does not make timely payments of all accounts issued to them.

Explanation: The Committee has resolved to introduce a usage credit of up to $350.00 for all new members with credit able to be applied only to on premises food and beverage consumption within 12 months of enrolment.

(vi) that Rules 76.1, 76.2, 76.3 and 76.4 be adopted as follows (and the numbering of

subsequent Rules will be updated accordingly):

76.1 Notice of such Annual General Meeting specifying the day and hour when, and the business for which it is to be held, shall be included in the notice specified in Rule 76.

76.2 Any Member may propose an item of business for an Annual General Meeting by posting to the Committee a written description of his or her proposal so that it is received by the Committee at least seven days before the notice of an Annual General Meeting is required to be posted in the Clubhouse in accordance with Rule 76.

76.3 It shall not be competent for any Annual General Meeting to transact or to entertain any business except the business specified in that notice. Any general business shall be limited to matters that in the opinion of the President concern the welfare of the Club or which are likely to be in the interest of Members generally.

76.4 No motion maybe put to the Annual General Meeting in relation to any matter unless Rule 76.2 has been complied with, unless the President in his/her sole discretion considers the matter is not of such degree of significance or importance that prior notice of the matter under that Rule is necessary.

Explanation: After considering the approach of other clubs similar to the Northern Club, the Committee has resolved to propose the introduction of new Rules to clarify when and how motions may be proposed at an Annual General Meeting.

The Rules do not require a Member to notify an issue/motion he or she wants to raise/propose at an Annual General Meeting of the Club. Any matter of any level of significance can be proposed by any Member attending the meeting. If raised, any matter would need to be addressed under generally accepted meeting rules.

The Committee is concerned over the potential for resolutions to be proposed at an Annual General Meeting where other Members and the Committee are unaware of the proposal and do not have adequate time to consider the pros and cons of that resolution nor to properly consider the implications for the Club or consider alternative approaches. This is in contrast to matters formally identified in a Notice of Annual General Meeting. If Members wish to raise significant matters that are not identified in a Notice of Annual General Meeting, Rule 78 provides for the Committee to convene a Special General Meeting at its own initiative, or on the written requisition of fifteen members, specifying the business for which the meeting is to be held. A Special General Meeting can only address the business specified in the notice for that meeting or any other matter that two- thirds of the Members at the meeting agree is directly related to that business. The Committee's view is that Rule 78 is intended to establish a process to deal with any potentially contentious issues within the Club. The procedures for the Annual General Meeting should provide similar safeguards to ensure all Members are aware in advance of any potentially significant or controversial business that is sought to be conducted at that meeting, accordingly we recommend the insertion of Rule 76.1, 76.2, 76.3 and 76.4 as set out above.

3. Election of Auditor

4. Election of Officers for the financial year 1 April 2016 to 31 March 2017

President: DA Nolan is nominated

Proposer: MB Spencer

Vice President: Mrs VM Carter is nominated Proposer: DA Nolan

Committee: There being four vacancies, the following members are nominated:

Mr SC Leavy Proposer: DA Nolan Ms JM Bensemann Proposer: DA Nolan Hon. Justice PJ Davison Proposer: PRJ Gibson Mr AF Pilditch Proposer: DA Nolan

5. General Business

Dated: 02 May 2016 BY ORDER OF THE COMMITTEE

1

THE NORTHERN CLUB AUCKLAND, NEW ZEALAND

REPORT OF THE COMMITTEE FOR THE YEAR ENDED 31 MARCH 2016

Your Committee has pleasure in submitting to Members its Annual Report, together with the Statement of Financial Position for the year ended 31 March 2016.

Deaths

It is with sadness that the committee recorded during the year the deaths of Mr GS Brent, Mr E Cammell OBE JP, Mr JGC Cocks, Dr JAK Commons, Rt Hon. Sir Ronald Davison GBE CMG QC, Mr OT Foster, Mr TT Goldfinch, Mr PJ Grace, Mr JB Horrocks ED, Mr BL Maples, Mr DL Miller, Sir Patrick Eisdell Moore, Mr JG Naylor, Mr C Olliver MBE VRD, Mr CA Peterson, Mr W Rawlings, Mr JH Rhodes, Mr DE Smythe, Mr JB Spencer, Mr DP Walden

Financial Results

The Club reported a net surplus after tax of $364,086. This is a pleasing result, though not as good as the Committee had hoped. The results reflected a lower usage of our facilities such as the Members’ Dining Room and may have been affected by the 2015 Rugby World Cup when many of our members were out of the country following the fortunes of the All Blacks.

The profitability of your Club depends greatly on the revenue achieved from functions hosted by members in the Club, and although at times these functions can cause a little inconvenience to members’ enjoyment of other facilities at the Club, it is well to remember that such functions provide two thirds of the Club’s revenue.

Capital Works

In addition to the normal Repairs and Maintenance that are a part of preserving an historic Clubhouse, several other initiatives have been undertaken of a more long term nature.

A plan has been drawn up to renovate the upper floors of the historic building, including the upgrading and enlarging of existing bedrooms and a business centre which members can use to check their e-mail, make calls and arrange meetings when away from their normal offices. At the same time as these renovations are undertaken the upper floors of the building will be strengthened to make them more earthquake resistant. Beca has been commissioned to take this project through to obtaining a building permit. At that time we will be able to obtain an accurate cost of the work to be done. The first phase of the work will be the Business Centre where no earthquake strengthening work is anticipated.

A second project, to enhance and extend facilities on our Bankside Street frontage and to upgrade Bankside Restaurant, has been considered and is still in the early stages of concept design.

With the agreement of Barfoot and Thompson who now own the previous Auckland Club premises, the Club installed a plaque outside the long-time location of the Auckland Club in Shortland Street so that everyone walking up Shortland Street can be reminded of its history.

2

Finally, in the next few months, members should be prepared to see a change to the outside of the historic Clubhouse as it has become apparent that the old, disused fire escape must be removed. This will have to be done carefully so as to damage the Virginia Creeper as little as possible.

Membership

For the first time in the Club’s history the membership numbers surpassed 2000, with an increase of 24 members including an increase of 12 women members.

Functions, Events and Activities

This year saw the continuation of the successful regular monthly events such as the Professional & Business Women’s Lunches, the Young Members’ Drinks and Lunches and Jocelyn’s ever popular lectures series. Similarly, events outside the Clubhouse such as Rugby at Eden Park, Auckland Theatre Company plays, ballet and rock concerts continued to attract large numbers of members who valued the convenience, conviviality and the Club’s purchasing power for tickets.

The Committee acknowledged the ubiquity of mobile and hand held devices and modified the by-law to allow them to be used for reading or referring to but only with the sound turned off.

Management and Staff

During the year our General Manager, Mrs Nicki de Villiers travelled overseas twice. Once to the Private Clubs Marketing/Membership Professionals conference at the Vancouver Club and once to Pittsburgh to be admitted as the first woman member of the Distinguished Clubs of the World. As a result of these visits she has brought back a number of new and innovative ideas that will be introduced into The Northern Club as time and circumstances permit. Because the year was such a busy one, we were fortunate that there were no significant changes in the management team or the staff, though by the time Christmas came they were all ready for a well-earned break.

Trustees and Committee

As usual the Trustees and Committee have provided strong support for the President and Management of the Club, and in particular Derek Nolan as Vice President has overseen the House Committee and the day to day running of the Club with typical efficiency.

Conclusion

The Northern Club is in good heart and good hands. Your proposed new President, Derek Nolan, a fourth generation Member of the Club will be a third generation President of the Club, a wonderful example. He will be joined by Victoria Carter, the first woman Vice President of The Northern Club.

Expect great things from these two precedents!

MB Spencer President 2016

3

* These figures are the net operating surplus so they exclude items such as sale of Air Rights, interest, and any other revenue that is deemed non-operating.

** Reduction during basement refurbishment. *** Reduction during Wintergarden renovation.

Year Membership Gross Surplus $NetOperating Surplus

StaffNumbers

Meals Served

1996 930 1,194,573 152,605 27 20,994 1997 1000 1,369,680 179,431 27 22,922 1998 1023 1,410,774 139,380 27 21,934 1999 1122 1,472,281 154,942 25 25,056 2000 1169 1,517,006 224,936 25 29,109 2001 1189 1,453,767 212,980 25 29,278 2002 1207 1,554,754 *131,452 25 **27,508 2003 1243 1,681,111 *178,136 25 36,720 2004 1267 1,660,946 *98,281 25 36,206 2005 1273 1,777,090 *156,832 25 37,391 2006 1342 1,914,630 *224,575 25 38,901 2007 1522 1,952,610 *169,667 25 37,683 2008 1504 2,050,319 172,583 25 39,801 2009 1494 2,179,595 ***51,776 25 42,078 2010 1519 2,524,457 *271,615 26 48,885 2011 1936 2,584,249 *94,331 32 52,008 2012 1900 2,847,277 *148,625 30 55,770 2013 1910 3,020,390 *163,036 31 56,943 2014 1935 3,234,192 *316,984 30 58,078 2015 1987 3,345,592 *323,695 30 56,569 2016 2016 3,320,373 *191,859 31 55,389

REPORT OF THE COMMITTEE

FOR THE YEAR ENDED 31 MARCH 2016

4

5

6

7

8

9

10

11

Committee's responsibility for the special purpose financial statements

Auditor’s responsibility

Opinion

12

Basis of accounting and restriction on distribution and use

13