Ombud Council AR 2026

PART F: FINANCIAL INFORMATION

23. Budget differences Material differences between budget and actual amounts The Annual budget was approved by the Executive Authority. There are material differences between the annual budget and actual amounts for the 2025/26 financial year that are explained below: Levies The total levies recognised as at 31 March 2026 is 8% more than the annual budget due to new entrants in the financial sector and increases in Funds Under Management (FUM) and this is mainly in the FAIS, CIS, Hedge and Insurance industries. Interest received The total interest received recognised as at 31 March 2026 is 38% less than the annual budget due to the Council receiving Levies in the bank account far later in the year than anticipated. Employee cost The total employee cost recognised as at 31 March 2026 is 7% less than the annual budget due to savings from salary adjustments and bonuses. The total number of full-time employees budgeted on the approved organisational structure for the 2025/26 financial year is 8 and all positions were filled from the start of the year. Board and other committee remuneration The total remuneration recognised as at 31 March 2026 is 15% more than the annual budget due to a board workshops and board member incidental costs not initially budgeted for. It should be noted that in accordance with section 175(3) of the FSR Act (2017), the Chairperson (not the Board) is the Accounting Authority of the Ombud Council, which entails additional tasks and responsibilities. Professional and consulting fees The total fees recognised as at 31 March 2026 is 71% more than the annual budget. Services budgeted for include Board Secretariat support, risk and compliance management support, legal services, and HR support services. Expenditure includes higher than budgeted legal fees due to unexpected litigation costs. Outsourcing on an as needed basis is considered more cost efficient due to the lean organizational structure in place. The variance on this line item was expected at the time of budgeting for 2025/26; the Council was in the middle of the baseline year which was 2024/25. Financial year 2024/25 was the Ombud Council’s first year of operational independence (after shared services support from the FSCA in prior years) and the Council is now in a better position to more accurately estimate the range of outsourced services required. Other operating expenses The total operating expenses recognised as at 31 March 2026 is 44% less than the annual budget due to the cashflow risk identified during the financial year, the Council had been containing costs and deferring planned operating expenditure not committed to until the levy payments started to flow from February 2026. Consumer education and awareness The total consumer education and awareness costs recognised as at 31 March 2026 is 29% less than the annual budget due to the cashflow risk experienced during the financial year. The Council therefore had contained costs and paused all consumer education and awareness projects not committed to from 1 September 2025 to 31 January 2026 until levy payments were paid to the Ombud Council in February 2026. The main reason for the variance is the delay in the baseline study, which could not be implemented in 2025/26 as targeted, primarily due to cash flow constraints.

Ombud Council 2025/26 Annual Report

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