From the OAH Treasurer

Fiscal Year July 1, 2003 - June 30, 2004

Robert W. Cherny

In my second report as treasurer, the news remains almost entirely positive. My report is drawn from the annual accountants’ report, which includes an audit, and from a less formal summary prepared by the OAH business manager. The accountants’ report is prepared by the CPA firm of BKD LLP.

Total Assets

The accountants’ report indicates total assets at the end of the 2004 fiscal year of $2,826,210, as compared to $2,837,831 the year before. Of the current assets, the largest single category consists of investments, worth $2,283,824. The next largest categories are operating cash, $360,019; receivables, $120,805; and property and equipment, at $32,806, net of depreciation and amortization.

Revenue

Total revenue was up from $2,704,881 to $2,782,468. Figure 1 indicates revenue by type.

Our largest source of income continues to be dues, which totaled $1,005,803, a small increase over 2003. Several other revenue categories also showed increases over last year, notably investment income, which more than doubled since last year. Advertising revenues continued to decline however, especially for the journal, reflecting the continued financial weakness of university presses due to reductions in university support. There are indications that this trend will continue and even intensify, as universities turn from print to online publications. Revenue from grants and collaborative projects was also down, due largely to decreases in projects funded by the National Park Service. Other than investment income, the other largest increases in revenue came from lectureships and contributions, reflecting, in part, an increase in expenditures on development.

Endowment Fund and Investments

The accountants’ report shows the following net assets for our endowment fund, the Fund for American History, and the prize fund in Table 1.

Between 2002 and 2003, these funds were shifted from a mix of various securities to a mix of mutual funds. Wells Fargo Bank administers these investments and shifts our funds from time to time as conditions seem to warrant. Based on the benchmarks set by the bank for each mutual fund, all are performing well.

Expenditures

Total expenditures were up from $2,617,140 to $2,739,818. The major categories of expenditures are shown in Figure 2. The biggest decrease came in grants and collaborative projects, corresponding to the reduced revenue in that category. The cost of the annual meeting was up significantly, given significantly higher costs in Boston than in Memphis.

Audit Recommendations

Previous accountants’ reports have included a series of recommendations for changes in the organization’s procedures for bookkeeping and handling cash. Major changes were implemented in response to the findings in the 2002 and 2003 reports. The last of those changes were implemented last year, and this year’s report includes no recommendations for further changes.

The Bottom Line: Fiscal Year 2003-2004

The accountants’ reports show the following revenue and expenses for the past three fiscal years (in Table 2): Thus, judging by the bottom line, fiscal year 2004 was a successful year for the OAH.

Outlook for Fiscal Year 2005

So far in the current fiscal year, the organization remains in a strong position. Nonetheless, for the first time in the organization’s recent history, the Executive Board approved a mid-year budget revision, due in part to lower revenues than anticipated in a few areas, especially grants and contracts and advertising (reflecting the continuing financial difficulties of university presses) and due in part to some unanticipated expenses, especially for a new database system. Previously the organization had planned to revise its existing database but was unable to do so. At the recommendation of the AHA and APSA, the organization has purchased a system called NOAH. To accommodate this increase, it was necessary to reduce budgeted expenditures in other areas, but it has been possible to do this without affecting the organization’s operations.