Important changes to the Annual Administration Fee (AAF) Policy (FSC-POL-20-005 V3-1).
Please click here to access the new version of FSC-POL-20-005 V3-1 (effective 1st January 2022). Document | Forest Stewardship Council (fsc.org)
As you would be aware, part of your annual FSC certification costs includes payment of the AAF, which is charged by FSC Global Development (FSC GD). The fee is set by FSC, based on FSC-POL-20-005, and invoiced by Global-Mark at the time of your annual audit. The purpose of the AAF is to support the services provided by FSC GD to uphold the core operations of the FSC certification system, both at national and international level.
FSC has revised the AAF structure for chain of custody certification to make it more equitable and provide FSC with additional funding to invest in increasing the value delivered by FSC. For a detailed explanation of FSC initiatives and the rationale on the revised AAF policy, please click here Annual Administration Fee | Forest Stewardship Council (fsc.org)
Under the current AAF policy, companies at the lower end of a AAF Class pay the same fee as those at the top of the class. For example, a company with forest products turnover of US$101 million will pay the same fee as a company with a forest products turnover of US$499 million, using the existing method. To address this, FSC has introduced a new methodology which calculates AAF based on the certificate holder’s actual Forest Products Turnover. You can get an estimate of what your revised AAF would be by consulting the AAF Policy or by contacting Global-Mark directly.
The revised policy also includes some other important changes, including:
- There is no longer a distinction between the AAF chargeable for single site and multi-site certification, instead a fee will be calculated based on the aggregate Forest Products Turnover of the site(s)included in the scope of certification.
- The number of AAF Classes is reduced from 11 to 7.
- Clarification of data collection requirements.
- Clarification of terminology, for example COC enterprises which do not qualify as Traders shall now be referred to as Processors.
- Clarification of obligations of certification bodies and certificate holders.
- Numerical parameters for calculating AAF moved to separate Annexes.
What do certificate holders need to do?
During your 2022 annual audit, the auditor is now required to collect the actual Forest Products Turnover, which organisations must provide supported by evidence. Certification bodies shall not rely on oral or written self-declarations alone. Examples of supporting documentation for the Forest Products Turnover include tax records and filings, accounting records, financial statements, a declaration from an accountancy firm and management accounts showing financial general ledger coding. If your annual audit is after 1st July 2022, you may be approached to provide the information outside of your annual audit.
The AAF will be calculated using the new method from 1st July 2022.
For more information:
Should you have any questions or concerns, please contact your Client Manager or the FSC Program Manager, Emily Silberberg on: fsc@global-mark.com.au
