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Transparency

Eighty percent of profits after tax for the whole company is put back into Community projects. We do this by supporting our sister organisation and NGO (charity) Reality Gives.

For most people, this is enough to know, but we understand why people might be sceptical of this claim, so the following information is

for those people who would like to "audit" us properly. We understand that this is still not perfect, and we welcome suggestions as to how to do this better. We would like to be as transparent as possible.

Eighty percent of post tax profits means that in any one year, up to 30% of the income

generated by Reality Tours is used for Reality Gives' activities. The amount that we can donate of course depends on the profitability of the company- in the initial years for example, we ran at a loss.

The money that is actually given for Reality Gives' activities doesn't necessarily match the amount calculated above. This can be for several reasons:

  • The accounting profit is more than our cash flow, because money has been spent on amounts not reflected in the profit and loss account, like fixed assets and lease agreements
  • Reality Gives does not need the money immediately. Why not transfer the money you might say? According to Indian regulations, an NGO is encouraged to spend donations soon after they have been received.

Calculation of Profits

We understand that it's all well and good saying that we are going to put back 80% of profits into the Community

but if the owners are drawing a big salary, then this rule has little value! Hence we pledge that 80% of all profits from Reality Tours will be paid to Reality Gives or other NGOs after the payment of the following:

  • Tour company expenses
  • Tax payable on profits
  • A reasonable salary to the two owners - Chris Way and Krishna Pujari - for conducting the slum tours. This has increased steadily over the years and is disclosed in the accounts below. This is still a lot less than what an owner of a tour and travel company would earn.

Chris Way left India in 2014 and although consults with both Reality Tours and Travel and the NGO Reality Gives, he does not draw an income or any other form of compensation.

The profits are then adjusted because there are some payments which have been paid for Reality Gives by Reality Tours. This includes an apportionment of some salaries as some staff work for both Reality Tours (who pay them) and Reality Gives.

We want to show how much the tour company would earn without any contribution to Reality Gives. Also there is an adjustment for Chris Way's excess salary (to comply with visa regulations, Chris Way has had to be paid US$ 25,000)

We then calculate 80% of this adjusted post tax profit which is what needs to be spent on Reality Gives activities or donated to them.

We then calculate how much money was actually spent that year on Reality Gives' activities or donated to Reality Gives (or other NGOs), and then the balance- What was due less what was spent/donated.

You might wonder why Reality Tours would make payments on behalf of Reality Gives. Why doesn't Reality Gives make the payments themselves? We consider the activities of the Community Centre in Dharavi for example, essential in the successful running of the Dharavi tour.

Here is a document summarizing Reality Tours' profits and expenses and how the money given to Reality Gives was spent.

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Accounts

The accounts are audited by a registered auditor and put online here. We do this because we are open and honest and have nothing to hide.

Here is a document summarizing Reality Tours' profits and expenses and how the money given to Reality Gives was spent.

Year ending 31 March 2015 (See audited accounts)

The company made an adjusted tax profit of Rs 6,202,261 for the year ending 31 March 2015. Turnover was Rs 22,446,943. The amount due to be spent on Reality Gives activities for the year was Rs 4,961,809 (22.1% of turnover) and we spent Rs 6,341,181. The rolled over overspend on Reality Gives activities at the end of the year was Rs 1,576,612.

Rs 632,510 was spent on the Community Centre. This figure was capitalized on the Balance Sheet.

Depreciation of Rs 114,392 relating to the Community Centre and previous years expenditure on Kindergarten expenses was debited as an expense on the profit and loss account.

Krishna Pujari received a salary of Rs 642,400 and Chris Way received a salary of Rs 138,720 for the year. Chris Way left India in May 2014. Assuming a salary of Rs 58,400 each per month, the excess salary paid was zero since Chris Way continued to work for Reality Tours while abroad and received no additional income.

Total apportioned salaries to Reality Gives was Rs 2,195,170.

Rs 3,180,000 was given to Reality Gives in the form of donations from Reality Tours, and Rs 333,501 was given to other NGOs.

Year ending 31 March 2014 (See audited accounts)

The company made an adjusted tax profit of Rs 2,928,796 for the year ending 31 March 2014. Turnover was Rs 16,751,493. The amount due to be spent on Reality Gives activities for the year was Rs 2,343,037 (14.0% of turnover) and we spent Rs 3,698,799. The rolled over overspend on Reality Gives activities at the end of the year was Rs 106,806.

Rs 702,519 was spent on the Community Centre. This figure was capitalized on the Balance Sheet.

Depreciation of Rs 297,693 relating to the Community Centre and previous years expenditure on Kindergarten expenses was debited as an expense on the profit and loss account.

Krishna Pujari received a salary of Rs 254,000 and Chris Way received a salary of Rs 1,343,520 for the year. The reason why Chris Way's salary was so high was to comply with visa regulations. Assuming a salary of Rs 50,800 each per month, the excess salary paid was Rs 479,920. Adina Goerke's salary (Marketing Director) of Rs 3,11,300 was paid by Chris Way and there was an excess salary of Rs 9,000 for another member of staff

Total apportioned salaries to Reality Gives was Rs 1,046,280 (Chris Way Rs 406,400 and Krishna Pujari Rs 182,880).

Rs 1,950,000 was given to Reality Gives in the form of donations from Reality Tours.

Year ending 31 March 2013 (See audited accounts)

The company made an adjusted tax profit of Rs 4,700,902 for the year ending 31 March 2013. Turnover was Rs 13,120,976. The amount due to be spent on Reality Gives activities for the year was Rs 3,760,722 (28.7% of turnover) and we spent Rs 1,712,215. The cummulative amount owed to Reality Gives at the end of the year was Rs 1,248,956.

Rs 744,888 was spent on the Community Centre.

Depreciation of Rs 345,793 relating to previous years expenditure on Kindergarten expenses was debited as an expense on the profit and loss account.

Krishna Pujari received a salary of Rs 490,176 and Chris Way received a salary of Rs 1,209,600 for the year. The reason why Chris Way's salary was so high was to comply with visa regulations. Assuming a salary of Rs 40,800 each per month, the excess salary paid was Rs 720,576.

Total apportioned salaries to Reality Gives was Rs 485,952 (Chris Way and Krishna Pujari Rs 146,880 each. Evelyn D'Souza- Secretary Rs 46,440. Asim Shaikh- Community Centre Manager Rs 145,752)

Total salaries related to Reality Tours and Travel but paid by Reality Gives UK was Rs 293,625 for Adina Goerke (Fundraising and Marketing Director for Reality Gives and Marketing Director for Reality Tours and Travel)

Rs 775,000 was given to Reality Gives in the form of sponsorship from Reality Tours.

Year ending 31 March 2012 (See audited accounts)

The company made an adjusted tax profit of Rs 2,876,849 for the year ending 31 March 2012. Adjusted Turnover was Rs 8,377,362. The amount due to be spent on Reality Gives activities for the year was Rs 2,301,479 (27.5% of turnover) and we spent Rs 2,392,495. The rolled over overspend on Reality Gives activities at the end of the year was Rs 799,551.

Rs 410,810 of the total turnover related to sales of merchandise

Rs 746,744 was spent on the Community Centre.

The company also spent Rs 871,141 on the new kindergarten. This figure was capitalized on the Balance Sheet. Depreciation of Rs 260,909 relating to this was debited as an expense on the profit and loss account.

Krishna Pujari received a salary of Rs 367,205 and Chris Way received a salary of Rs 1,202,650 for the year. The reason why Chris Way's salary was so high was to comply with visa regulations. Assuming a salary of Rs 30,000 each per month, the excess salary paid was Rs 830,655.

Total apportioned salaries to Reality Gives was Rs 375,115 (Chris Way and Krishna Pujari Rs 110,880 each. Evelyn D'Souza- Secretary Rs 37,080. Asim Shaikh- Community Centre Manager Rs 116,275)

Total salaries related to Reality Tours and Travel but paid by Reality Gives UK was Rs 157,500 for Adina Goerke (Fundraising and Marketing Director for Reality Gives and Marketing Director for Reality Tours and Travel)

Rs 378,000 was transferred to Reality Gives as a donation and Rs 178,995 of other Reality Gives' expenses was paid by Reality Tours.

Year ending 31 March 2011 (See audited accounts)

The company made an adjusted tax profit of Rs 2,177,603 for the year ending 31 March 2011. Adjusted Turnover was Rs 5,705,334. The amount due to be spent on Reality Gives activities for the year was Rs 1,742,082 (30.5% of turnover) and we spent Rs 2,375,900. The rolled over overspend on Reality Gives activities at the end of the year was Rs 7,08,535.

Rs 632,715 of the total turnover related to sales of merchandise

Rs 786,209 was spent on the Community Centre.

The company also spent Rs 1,418,691 on the new kindergarten. This figure was capitalized on the Balance Sheet. Depreciation of Rs 187,511 relating to this was debited as an expense on the profit and loss account.

Krishna Pujari received a salary of Rs 120,000 and Chris Way received a salary of Rs 480,000 for the year. The reason why Chris Way's salary was so high was to comply with visa regulations. Assuming a salary of Rs 20,000 each per month, the excess salary paid was Rs 240,000.

Total apportioned salaries to Reality Gives was Rs 171,000 (Chris Way and Krishna Pujari Rs 72,000 each. Evelyn D'Souza- Secretary Rs 27,000)

Year ending 31 March 2010 (See audited accounts)

The company made an adjusted tax profit of Rs 1,448,079 for the year ending 31 March 2010. Adjusted Turnover was Rs 3,884,455. The amount due to be spent on Reality Gives activities for the year was Rs 1,158,463 (29.8% of turnover) and we spent Rs 1,220,339. The rolled over overspend on Reality Gives activities at the end of the year was Rs 74,717.

Rs 240,600 of the total turnover related to sales of merchandise

Rs 423,135 was spent on the Community Centre.

The company also spent Rs 725,204 on the new kindergarten. This figure was capitalized on the Balance Sheet. Depreciation of Rs 80,687 relating to this was debited as an expense on the profit and loss account.

Krishna Pujari received a salary of Rs 120,000 and Chris Way received a salary of Rs 480,000 for the year. The reason why Chris Way's salary was so high was to comply with visa regulations. Assuming a salary of Rs 10,000 each per month, the excess salary paid was Rs 120,000.

Total apportioned salaries to Reality Gives was Rs 72,000 (Chris Way and Krishna Pujari Rs 36,000 each)

Year ending 31 March 2009 (See audited accounts)

The company made an adjusted post tax profit of Rs 745,092 for the year ending 31 March 2009. Turnover was Rs 2,524,244. The amount due to be spent on community work for the year was Rs 596,074 (23.6% of turnover) and we spent Rs 282,746 on the Community Centre. The rolled over overspend on community activities at the end of the year was Rs 12,841.

No dividend was paid to the directors and salaries of directors Krishna Pujari and Chris Way were Rs 150,000 each per year.

Year ending 31 March 2008 (See audited accounts)

The company made an adjusted post tax profit of Rs 229,023 for the year ending 31 March 2008. Turnover was Rs 1,141,135. The amount due to be spent on community work was Rs 183,218 (16.1% of turnover) yet we spent Rs 257,005 setting up a Community Centre. The rolled over overspend on community activities at the end of the year was Rs 326,169.

Krishna Pujari received a salary of Rs 100,000 for the year and Chris Way has not received any salary during this period. Neither have accrued any further amounts

The company paid no dividend throughout the year and the salaries paid to the directors were reasonable.

Year ending 31 March 2007 (See audited accounts)

The company made a loss of Rs 204,312 for the year ending 31 March 2007. Turnover was Rs 376,099. Reality Gives had not been set up and we spent no money on activities benefiting the Community.

Krishna Pujari received a salary of Rs 89,750 for the year and Chris Way has not received any salary during this period. Neither have accrued any further amounts

The company paid no dividend throughout the year and the salaries paid to the directors were reasonable.

Reasons for loss:

  • Promoting the tours was difficult, as in the period ending 31 March 2006. We did receive a lot publicity in the national and international press which helped a lot, although we were still not in any guide books.
  • Depreciation was a major expense again (Rs 155,475) and we didn't use the second car enough to justify this expense.
  • We still kept the prices very competitive, probably too low, for reasons explained before.

Period ending 31 March 2006 (See audited accounts)

The company made a loss of Rs 111,166 for the period ending 31 March 2006. Turnover was Rs 25,343. Reality Gives had not been set up and we spent no money on activities benefiting the Community.

Neither of the owners Krishna Pujari or Chris Way have received nor have accrued any salary during this period.

Reasons for loss:

  • We had no idea of what the customer demand would be like. We thought that it would be prudent to purchase two vehicles, which in hindsight was a mistake. The main expense was the car depreciation, which was just over Rs 45,000.
  • The sales of Rs 25,343 was a lot less than we had expected. We had problems promoting the tours- tourists were skeptical and in some cases a little hostile to receiving flyers, and hotels were not interested- a lot of them run their own sightseeing tours.
  • The company was set up in September 2005, but we had a lot of problems in obtaining a tourist permit for the two cars- we obtained these in January 2006. Yet we still incurred some costs during this period, such as office rent and some staff salaries.
  • We had initial start up costs such as printing flyers and brochures, and staff training.
  • We ran the tours and charged the same amount per person if there was one person or five people. We also didn′t want the price to be a hindrance- both backpackers and 5 star holidaymakers are charged the same. Financially this might be a mistake but we want as many people as possible to come on the tour.
  • The loss has been mitigated by the fact that neither of the owners Krishna Pujari or Chris Way received or accrued a salary during the period.
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