2006 Report of the Treasurer

Abstract

The Society’s financial year runs from June 1 through May 31 to coincide with the Society’s policy development year. Because the fiscal year ends May 31, the Treasurer has three financial periods to cover in the annual report: (1) final audited prior-year numbers (for the fiscal year 2005), (2) current year (2006) projected performance, and (3) budget for the fiscal year ending May 31, 2007. The ASHP Board of Directors chose the Washington, D.C., firm of Tate and Tryon as the Society’s auditors for the fiscal year ended May 31, 2005. The audit of the financial statements of the Society and the Society’s subsidiary, the 7272 Wisconsin Building Corp., resulted in an unqualified opinion. Copies of the audited statements can be obtained by contacting the ASHP Executive Office. Last year I reported that the Society was expecting a $4.162 million surplus for the 2005 fiscal year. We actually ended the year with a $2.726 million surplus, $278,000 from core operations and $2.448 million from the program development budget (Figure 11). The ASHP core budget represents the revenue and expense associated with the core operations of the organization. The program development budget is intended for the following types of expenditures: (1) expenses associated with new, enhanced, and expanded programs, (2) expenses associated with time-limited programs, (3) capital asset purchases, or (4) supplemental operating expenses. The program development budget is funded from investment income. The return in the Society’s long-term investment portfolio tailed off in the last four months of the fiscal year; this was the main reason for our missing the projected goals. Nevertheless, 2005 was a strong year for the Society. The Society’s net worth increased to $36.559 million (Figure 2 2), or 86% of total ASHP and 7272 expense. (7272 expense represents the expense of the Society’s wholly owned subsidiary the 7272 Wisconsin Building Corp.) Our long-term financial policy is to maintain net worth at 75% of total ASHP and 7272 expense, with a ceiling of 90% and a floor of 60%.