MVF Finances May 2014

Treasurer’s Summary

 Overall results through the end of May continue ahead of budgeted projections led by greater than expected revenues from assessment collection fees, disclosure fees and advertising as well as lower than budgeted personnel and operating expenses.

 MVF overall net income for the month is $69,121 which is lower than the budget by 38.3% and May 2013 by 12.4%.  Year to date net income is $886,447 which exceeds the budget by 52.3% and May 2013 by 41%. 

 The following summarizes MVF’s overall results for May 2014:

 -        Total revenues through May were $3.4M which exceeds the budget by 4.4% and exceeds the same period in 2013 by 9.4%.

 -        Total operating expenses through May were $2.6M, which is 5.9% under budget and 1.5% over the same period last year.

 -        Reserve Fund contributions through May were $395,835 as prescribed in the 2014 budget.

 -        Year to date expenditures for reserve related assets total $939,234 vs. $236,986 in 2013.

 -        Capital contribution fees received through May were $151,780 vs 81,158 in 2013.  A lump sum payment of $110,000 was paid to MVF during February related to the sale of the Cider Mill apartment complex.

 Operations Fund

The results from the Foundation’s Operating Fund at the end of May, 2014:

 Current Month

Budget:  For the month of May 2014, the revenue budget variance is primarily due to better than expected revenues from advertising, disclosure fees and rental fees but offset partially by lower than expected camps/classes and assessment collection fees.  Personnel costs are favorable to the budget due to lower than budgeted full-time wages as a result of several open positions that have been filled at lower than the budgeted wages.  Additionally, temp wages are also lower than the budget due to timing of budgeted pool wages vs actual wages paid.  Operating costs budget variance is primarily due to higher than budgeted landscape/maintenance expenses, occupancy and program supply expenses, but offset partially by lower than expected business and office expenses.

 Prior Year:  For the month of May 2014 vs. May 2013, the revenue variance is due to higher assessments from the Designated User assessment increase effective January 1, 2014 as well as greater advertising revenues but offset partially by lower than expected camp/class revenues and property maintenance revenues.  Personnel costs are lower than the year ago period primarily due to lower full-time wages from several positions in 2014 rehired at a savings vs the year ago period.  Operating cost variance is due to higher costs from office and program supplies, occupancy, and office expenses but offset partially by lower business and printing costs. 

 The results from the Foundation’s Operating Fund through the end of May, 2014:

 Year to Date

For the year-to-date period ending May 2014, the budgeted revenue variance is primarily due to higher than budgeted assessment collection fees, advertising revenues tracking ahead of budget, disclosure revenues via homewisedocs.com and the capital contribution fee received from the sale of the Cider Mill apartments; however these are offset partially by a significant shortfall in camp registration revenues.  Personnel costs budget variance is due to several vacant supervisory level positions, which have now been filled, but is partially offset by higher than budgeted workers comp due to an adjustment based on the results of the 2013 salary audit.  Operating cost budget variance is due to lower than expected business expenses, office supplies/expenses, equipment maintenance and landscaping/maintenance costs but is partially offset by higher than budgeted occupancy and program supply costs.  Reserve/capital costs reflect the higher revenue received from the Cider Mill capital contribution fee being moved from the Operating Fund to the Reserve Fund.  Reserve contributions have been made pursuant to the budget.

Balance Sheet:

Through the end of May 2014, MVF continues to maintain very a solid financial position with nearly $8.2M of its $14.7M assets (55.8%) currently invested or held in bank accounts.  While using undesignated reserves the last 2 years (2012 & 2013) to keep assessments low, MVF holds over $1.7M undesignated operating surplus which is partially allocated to ongoing capital projects and slated to be used as part of the 2014 budget to maintain the MVF assessment the same for the 3rd year in a row.

 Investment Activity:

During May the Audit committee met to review and provide input on the proposed revision of the investment policy drafted by the Investment committee at their April meeting.  The Audit committee made numerous recommendations to modify the policy.  These changes were noted and will be discussed by the Investment committee when they meet on July 14th to confirm a final draft policy and make a recommendation to the MVF Board at the Board’s July meeting.

Capital Spending:

As of the end of May, 2014, year to date capital expenditures totaled $839,301 of which 742,163 is related to Designated Users related and $97,138 is MVF.

For more detailed information and to view managements financial statements, please go to MVF's website www.montgomeryvillage.com

Respectfully submitted,

W. Gregory Snellings, CPA

Chief Financial Officer, Montgomery Village Foundation