Following the reintroduction of a financial assessment requirement as part of FAIM 3.2 and working with auditors EY, FIDI is now producing an annual report on the economic status of its affiliated business across the world. Here, we highlight some findings from the first of these
A financial assessment requirement was reintroduced as a part of FAIM 3.2 in January 2019, to demonstrate that FIDI Affiliates are financially sound and dependable partners to do business with – in other words, they can pay their bills.
FIDI has now released the first report from EY assessing the creditworthiness of FIDI’s membership, based on the financial accounts of affiliated companies.
By introducing an annual financial assessment of a company’s liquidity, solvency and profitability, we will be able to not only demonstrate its financial health at the time of assessment, but more importantly, we can identify trends in these ratios over time.
We now have data from this first pilot year, which has been assessed by EY – one of the big four in auditing.
The main conclusions of the report are positive, including that more than 80 per cent of our FIDI Affiliates have a ‘low risk’ score; and that FIDI Affiliates generally score better for solvency.
However, it also singles out a significant weak point: FIDI movers (and likely all movers worldwide) are not very profitable.
The report gives a good indication of how FIDI’s Affiliates are doing, what we are good at, where our pain points are and what we should be focusing on from a financial standpoint. This is particularly interesting at a time when our industry is grappling with the short-term effects and long-term implications of the COVID-19 crisis.
When change for survival is the prime concern, it is the bottom line that counts.
Here are some of the most significant findings and graphics from the report.