AIFA (the Association of Independent Financial Advisers), which encompasses AMI and the Association of Finance Brokers (AFB), revealed an operating deficit of £194,419 for the 12 months to 30 June 2011, compared to a surplus of £14,919 in 2009/10.
The loss came despite the trade body making cost cutting measures, particularly in marketing and distribution, as it faced a “challenging year” with the number of firms continuing to fall.
The results taking in AMI and the AFB showed that AIFA’s turnover was down 12% from £1.85m to £1.63m, with income from subscriptions down from £1.4m to £1.2m. Its expenses dropped slightly from £1.84m to £1.82m.
However, Sinclair said that AMI’s resources within the group for 2011/12 remain the same as last year and its work will continue unchanged.
He highlighted that steps have already been taken to reduce expenditure and keep its income stable.
Sinclair said: “AMI’s work will not be affected by AIFA’s loss.
“We are four months into 2011/12 and are projecting that the year will continue on a balanced basis. We cannot categorically say that there will not be a loss in 2011/12. However, we have plans in place to prevent this.”
In the results, Stephen Gay, managing director of AIFA, said: “We have had a challenging year as the changes in the market increase the demand for representation whilst the strain on the advisory community serves to test our own economic model.
“It has required us to think seriously about the direction of our association through a comprehensive strategic review and how we will be able to develop an organisation that works more closely with its members and achieves greater influence with regulators and policymakers.”
The strategic review has already seen AIFA extend its membership to restricted advisers and it is reportedly considering increasing fees for networks to be more in line with those it charges DAs.
The results were published in time for today’s AIFA annual general meeting.
