The 2002 IRS return for the American Orchid Society is now available at: http://www.guidestar.org/
This is how I read it: For the year 2002 (year ending 07/01/02) The deficit was $653,000. The actual prior year deficit $457,000 (removing the reversal of income booked in prior years but never received). Cash flow was also negative. Income from contributions, gifts and grants dropped by about $360,000 to $253,000. Program revenue increased $236,000. Dues decreased by $67,000. The society lost $74,000 on sales of securities, $11,000 on fund raising events (they lost $42,000 on the orchid gala! offset partially by a gain of $31,000 on auctions), and lost $ 3,000 on sales from inventory, presumably the orchid emporium. Personal comments: This is the second straight year that the AOS has lost money on the gala, and the Orchid Emporium seems to me to have a bleak future. Most orchid books are available at much lower prices from Amazon.com, and the trinkets they are trying to sell are greatly overpriced compared to what's available elsewhere. Admittedly most have an orchid decoration, but really how big is the market for that? Inventories did drop by $73,000. Expenses have been cut by $64,000 (excluding depreciation and again reversing the income booked but never received). Much of this came from salaries and benefits, but the Executive Director and the CFO did get moderate increases. Research grants were cut in half to $45,000. Liquid assets (securities, savings, inventory, receivables, prepaid expenses) were $3,779,000, down from $4,052,000 in the prior year and $9,380,000 in 1997. The difference went to the building program. Since the investment base is much smaller, dividend and interest incomes have dropped from $399,000 in 1997 to $189,000 in 2001 and $142,000 in 2002. Of course, the stock market crash and the low interest rates don't help, either. Personal comments: The primary purpose of a treasury is to accumulate funds for use in support of an organization's goals. Having a lot of money in the bank does not do anything for the membership unless it is used. I don't question building a headquarters facility with some of that money. I personally believe that the scope of the project was too large, and much of that money would have been better spent on orchid research, conservation and the like. The overall picture. In my view, is of an organization gradually going down hill. The situation is not yet drastic but it will be unless changes are made. I have yet to see anything concrete to indicate that anything is changing. Martin Epstein
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