Presentation on theme: "AAA 2003 Business Meeting 8/5/03 Honolulu, Hawaii We are well on our way to accomplishing our goals Successful 3-year budgeting process in place Cost accounting."— Presentation transcript:
AAA 2003 Business Meeting 8/5/03 Honolulu, Hawaii We are well on our way to accomplishing our goals Successful 3-year budgeting process in place Cost accounting system in development AAA 2003 Business meeting discussion Overview of 10 month financials Highlights of current association financial issues
June 30, 2003 Financial Statements Are we meeting our budget this year? On the bright side: Association Administrative Costs for 10 months are $1.08m or 10.2% below Y-T-D budget. These costs are 26.3% lower than the same category last year. Kudos to Sarasota!
However, although we have results for 10 months of the year, they do not include the critical annual meeting period: Of the $2.02m budgeted inflows from dues, + annual meeting + association journals $1.65m or 82% have been recognized. Of the $.777m budgeted as outflows for the same categories only $.343m or 44% have been booked, mainly due to annual meeting expenses not yet paid. Meeting registration numbers are expected to be very close to budget. June 30, 2003 Financial Statements
The cost of printing, mailing and postage for The Accounting Review are over budget due to the expanded size in recent issues. Subscription inflows from Accounting Horizons and Issues in Accounting Education are higher then budgeted due to an increase in the library subscription rate. June 30, 2003 Financial Statements
Association Fund Balances
Total Restricted/Unrestricted Funds
Unrestricted Net Assets 8/31/02
Observations Concerning Revenues Revenue estimates remain relatively flat – since there is not an obvious basis for an alternative assumption. Hawaii location is the driver of the 2003 decline in annual meeting revenue. Dues increase begins in The annual meeting produces a profit that subsidizes other activities of the organization.
Another View of Revenue
Major Expenses (non-capital)
Why have headquarter expenses increases since 1997? Cost of living Computer hardware and software and training costs Increasing support for section journals, meetings and mass s Web development Electronic accessibility of journals 1 electronic journal Electronic submission of annual meeting papers – piloted for three regional meetings Electronic meeting registration and payment for all AAA meetings Personnel increase for publications and web management and content New building to be maintained
Observations on Expenses Annual meeting costs decline in The estimated 2003 decline in headquarters expenses are the result of cost control measures. After 2003 estimated expenses assume a general 3% increase except for a few exceptional items. Health care cost is assumed to increase at 15%, after an initial decline in 2003 due to changes in health insurance. The increase is approximately $30,000 in Other items as noted.
Annual Change in General Fund Unrestricted Net Assets
The 2004 – 2006 decline in results The estimates are intentionally conservative. We have a history of large infrequent dues increases. The benefit of the dues increase in 2004 – approximately $200,000 dollars is offset by the assumed 3+% general increase in expenses through Basically, if AAA does not grow, expenses catch up to the dues increases.
Risks going forward Potential for declining membership Implications of Electronic publications environment Consideration of whether the annual meeting should continue to subsidize other activities of the organization?