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APPA: THE ASSOCIATION OF HIGHER EDUCATION FACILITIES OFFICERS

Executive Summary, Preliminary Draft March 31, 2014 Audit

©2012 CliftonLarsonAllen LLP2

2014 Audit Highlights

• Unmodified (Clean) Opinion on GAAP Financial Statements.

• 2013 Statements updated to reflect proper recognition of income in the amount of $84,800.

• Total net income, $260,367 in FY 2014 compared to $159,085 (as restated) in FY 2013

• Total Assets Increased 13%

• Total Liabilities Increased 13%

• Net Assets Increased 13% – Net assets represent 47% of total

expense compared to 44% in prior year

©2012 CliftonLarsonAllen LLP3

Review of Draft Financial StatementsStatements of Financial Position

• Total Assets Increased 13% to $4,202,719 in FY 2014 ($ 3,731,230 in FY 2013).

• Significant changes in Assets: – Cash/CD 539K

• Total Liabilities Increased 13% to $1,889,692 in FY 2014 from $1,678,570 in FY 2013.

• Significant changes in Liabilities:– AP/Accrued Exp 66k– Deferred Revenue 105k

• Net Assets Increased $260K• Net Assets to Total Expense Ratio

– Industry Minimum Goal = 30-50%– 2014 APPA = 47%– 2013 APPA = 44%

©2012 CliftonLarsonAllen LLP4

Review of Draft Financial StatementsStatements of Activities• 2014 total revenue increased 8% to

$5,180,198– Education 193k– Membership 91k– Supervisor’s Toolkit 72k

• 2014 expenses increase 6% to $4,919,831.

– Education 64k– Publication 99k – Membership 77k

• Expenses Presented on a Functional Basis (Costs Allocated to Programs and Supporting Services) in accordance with Nonprofit Standards.

• Cost Allocations Based on Estimates of Staff Time Devoted to Activities.

• Expenses also presented on a natural basis in the back of the audit report.

©2012 CliftonLarsonAllen LLP5

Review of Draft Financial StatementsGeneral Observations (ASAE 2–5 Million Range)

• Operating Efficiency Ratio (Total Revenue/Total Assets) 1.23, ASAE 1.1

• Leverage (Total Liabilities / Total Net Assets), .82, ASAE .80

* Membership income represents 36% of total revenue, ASAE Median Benchmark is 39.9%.

Source: ASAE 14th Edition of the Operating Ratio Report, Revenues $2-$5 million, 700 Associations reporting.

• Total personnel expenses as a percent of total revenue is 30.9%; ASAE 40.5%; similar budget

• Salary expense as a percent of total revenue is 23.2%, ASAE is 33.1%, similar budget

• Revenue per employee, $470,927, ASAE $228,609