Financial Factoid – Statement of Activity

Revenue for 2009 increased modestly principally as a result of the outstanding success of the Practice Partners and Industry Partners Programs. These increases were offset in part by declining Symposium revenue and Other Income such as advertising and product sales. Dues revenue increased proportionately to the number of Diplomates who are active members of ACVS.

Aggressive expense control measures adopted in response to difficult economic and budgetary conditions were reflected in decreased General and Administrative Expense of almost $200,000. These measures largely related to decreasing staff and related expenses as well as decreased Board of Regent expense and the winding up of lease payment obligations and elimination of moving expenses from our cost structure.

Operating Income reflected on the audited statements as “Increase in Unrestricted Net Assets” was $124,739 or approximately 5.1% of total revenue. This level of income is below our target of 7-8 % needed to meet future capital obligations including capital expenditures and prompt mortgage repayment.

The Symposium contributed approximately $200,000 to Operating Income on decreased revenue, which is indicative of the outstanding implementation of expense controls. This was a significant improvement over recent results for the Symposium. Importantly, the College would have lost money for the year without this tremendous contribution by the Symposium.

Our Investment Portfolio recovered well along with the overall equity markets. The future seems to be certain to include increased volatility of asset prices. Our Investment Policy will be reviewed this year and appropriate changes considered. Our real estate investment’s value is uncertain because of the absence of a liquid market. Applying general real property valuation trends one can assume its value has declined modestly. This is not relevant to our position as a long time user similar to the perspective of a “home owner” who has no plans to move. The College continues to benefit from the decrease in rent through office ownership. The initial term on our mortgage expires in 2014, which along with capital expenditures for association software over the next two years are important demands on ACVS capital. Financing options for the software as well as refinancing of our mortgage are being considered at this time.

As ACVS moves forward, continued reliance on Industry Partners and the expectation that the Symposium will “balance the budget” should be avoided. This approach to management of the College’s finances places the organization at significant financial risk. I am sounding the alarm to you, our Board of Regents and members that the College must become financial balanced. By financially balanced I mean that our reoccurring expenses related to certification, credentialing, publishing and member services must be met by our predictable reoccurring revenue. This revenue includes our dues, examination and credentialing fees, resident matriculation fees and stable advertising and publication income. Over time, I would also like to include a growing stream of income from our investment portfolio as well. Additionally, the success of the ACVS Foundation has led us to a point where its revenue, corpus of investments and investment income will begin to fund the majority of the College’s research mission and a growing portion of it education mission. The College will continue to provide financial support to Foundation activities within budgetary limitations.

There are many challenges facing the College in the future. Some of these issues will test our resolve as a College and as well as our commitment to stand unified as “ONE ACVS.” These challenges include fragmentation of the College by sub-specialization, recertification, dilution of the ACVS Brand by other existing and proposed veterinary organizations, maintaining Symposium relevance/income and the role of ACVS in veterinary education. Many of these will require financial resources beyond the level currently available, forcing prioritization by the membership. As the size and demographics of ACVS change overtime, it will be more difficult to be all things to all members. I encourage each member to consider the well-being of the entire College as you form opinions about future decisions placed before you. Those of us entrusted with continuing the organization’s legacy of success care deeply about our collective vision and ACVS as the mother of our training, expertise and professional position in veterinary medicine. Thank you for the opportunity to be of service to the ACVS. The ACVS Audited financial results are available upon request through the ACVS office. Please contact me with questions related to the College’s financial position or policies.

C. Collins “Andy” Anderson
Treasurer