CM assesses ROI on collections valuation

Canterbury Museum does not include the value of its object collection in financial statements.

Charlie Gates, Canterbury Museum’s accounts criticised by auditor-general, Stuff, 3 April 2018

The auditor-general has criticised Canterbury Museum for not including the value of its 2.3 million object collection in its annual financial statements.

The museum was issued an “adverse opinion” by the auditor-general for the 2015-16 and 2016-17 financial years, meaning it does not agree with the way it has filed its accounts.

“The museum’s collection assets are integral to what it does. However, Canterbury Museum Trust Board does not recognise these assets or the associated depreciation expense in its financial statements,” the auditor-general’s latest local government audits report states.

“Canterbury Museum Trust Board is of the view that all of its collection assets cannot be reliably measured. In 2017, we worked with Canterbury Museum Trust Board to try to better understand its reasons for having this view.

“Although we were not persuaded, we gave guidance to the museum that set out what additional information it could provide to us to support its view that collection assets cannot be reliably measured.”

Museum acting director Jennifer Storer said it had not included collection valuations in its financial statements “for many years”.

“The museum’s view is that the valuation of collection items is not possible for a large number of the collection items for which there is no active market,” she wrote in a statement.

“The cost and staffing resources required for preparing this information to meet accounting standards, and consistently updating it, for 2.3 million collection items far outweighs any benefit.”

The collection was “very large”, old – the museum has been collecting since 1870 – and consisted of a large number of gifted or subsidised assets, Storer said.

“As such, their cost is nil unless they have been acquired as a result of a purchase. The museum believes that it would be misleading to only capitalise purchased collection objects.

“In addition, the cost or fair value of the museum’s large collection of gifted heritage assets cannot be reliably measured and will be extremely difficult, time consuming and costly,” she said.