2016Q3 Reports: Treasurer
Treasurer's Report to ACL Executive for year ended 2015-12-31
Graeme Hirst, Treasurer
August 2016
This report is late, and is still not as fully detailed as I would wish, due to a confluence of circumstances that prevented the completion of the 2015 financial reports from our bookkeeper until the end of July. These circumstances included getting, once again, a new bookkeeper from our service, who required more education about the peculiarities of ACL's structure and organization than I had initially realized. And complete data was even later coming in than usual, including information and details about income and expenditure in Beijing for ACL 2015. As an extreme example: the invoice for the video recording of EMNLP 2015 Lisbon was not received from the company until the last week of July 2016, and then only because we asked for it.
Among the bookkeeping mysteries that took some time to resolve were several missing conference sponsorships. A problem that has been rare in the past, but which occurred several times this year, is companies or organizations that commit to a sponsorship not following through with payment, possibly after having received the benefits of sponsorship such as display of logos. It's not clear why this has increased. Possible causes include an overall increase in the number of sponsors, and hence in the number who are flaky; less aggressive chasing up of pledges by Priscilla because she lacks the time to do so; and changes in economic conditions or corporate strategy that take us out of consideration. (I will spare the offending sponsors the embarrassment of being named here in the hope that we might yet receive future fulfilled sponsorships from them.) Nonetheless, sponsorship of our conferences is up overall.
More details are shown in four linked files summarizing our financial results for 2015.
FILE 1: Our balance sheet, which shows a snapshot of our assets and liabilities at 2015-12-31:
On 2015-12-31, we had about $1.16 million in cash and investments and another $104,000 in abstract assets such as deposits and advances that we have prepaid for future conferences. Against this, we had liabilities of $140,000, which includes multi-year memberships and projected expenses of year-end bookkeeping and audit. An additional liability is the share of the surplus of ACL 2015 Beijing, not yet precisely determined but expected to be around $68,000, that we owe to AFNLP (see below).
In sum, our equity (prior to the sharing with AFNLP) is $1.12 million, up from $815,000 last year.
A substantial proportion, around 36%, of ACL's equity is in the discretionary subaccounts of chapters and SIGS. At year end, taking conference results into account, NAACL's subaccount balance was $25,000, and EACL's was €25,000. SIGs collectively had just over $333,000 (NOT taking into account distributions from ACL 2015), of which $232,000 is SIGDAT's and $48,500 is SIGDIAL's. Other SIGs have balances ranging from a few thousand dollars down to zero or less (SIGPARSE has a $2700 deficit).
We need to maintain very substantial cash reserves and equity -- ideally around $1 million -- for three reasons: (a) We need to be able to survive disastrous losses on conferences, perhaps two in the same year. (b) When we sign contracts with hotels and convention centers for $200-500K or more of conference services, these businesses are extending us a very large amount of credit (even though we also pay big deposits), so we undergo credit checks which, obviously, we need to have sufficient assets to pass. (c) Even with this credit, we still have to pay large five-figure and six-figure deposits for venues well in advance of any revenue from the event.
FILE 2: Our overall profit and loss statement (technically so-called even though we are a non-profit organization and therefore have surpluses, not profits):
Note that some lines on this sheet are horizontal sums that aren't particularly meaningful (such as the cost of conference bags or coffee breaks summed across all conferences), and some are artefactual (in particular, revenue of $46,685 in category 4540, chapter revenue, is actually just an internal transfer of funds from the surplus of ACL 2015 to the NAACL chapter; it is counterbalanced by the inclusion of the same amount as administrative miscellaneous expenses in category 6599).
Our gross revenue in 2015 (including artefacts) was $2.02 million, well up from 2015. Overall expenditure in the year was $1.72 million, giving a net surplus in the calendar year of $303,700. This is not the exact surplus on our operations for the year, because it doesn't take into account various liabilities incurred in 2015 nor payments in 2015 for 2014 liabilities. In particular, it does not take into account the approximately $68,000 share of the surplus of ACL 2015 Beijing that we owe to AFNLP (see below). Nonetheless, it is clear that we had a healthy surplus on operations in 2015. After some earlier years of losses, or tiny surpluses, on conferences, this surplus will help restore our assets to a higher level, and give us some breathing space for new initiatives.
FILE 3: Profit and loss statement for conferences:
Note: The "bottom line" figures on this spreadsheet include only 2015 transactions, and do not take into account expenses that were incurred in prior years. These expenses are, however, incorporated in the figures below.
Of our three major conferences in 2015, two had notable surpluses and one suffered a considerable loss.
(a) ACL 2015 Beijing, which was combined with AFNLP's IJCNLP, had a surplus of $147,900. The surplus will be shared with the SIGs that held workshops or co-located events on a person-day pro rata basis and then with AFNLP (50% of the remainder, estimated at $68,000).
(b) EMNLP 2015 Lisbon had a surplus of $73,250 for SIGDAT.
(c) Unfortunately, NAACL 2015 Denver had a loss of $36,300, which will be borne by the North American chapter.
But overall, the result was a surplus for the organization as a whole. These results -- both unexpectedly large surpluses and a large unexpected loss -- demonstrate the difficulty of predicting attendance, and hence income, and costs despite our best efforts at budgeting and prognostication. Sponsorships too are highly variable and unpredictable; ACL 2015 Beijing was particularly notable in attracting large sponsorships that contributed significantly to its large surplus.
FILE 4: Profit and loss statement for the journals, membership, and operations:
(a) The CL journal, of course, has no direct income any more. The costs, about $47,000 in 2015, are covered by membership fees and surpluses from the ACL conference. They comprise the cost of the editor's part-time assistant and services (copyediting, typography, online distribution) by The MIT Press.
(b) With the recent addition of a paid editorial assistant, TACL had a cost of $7000.
(c) Membership is required for attendance at any ACL conference, and many people do not pay for memberships any more except when registering for their first conference each year. (However, we still have many multiple-year memberships current from past years, including from when we "gave away" one-year memberships, or membership extensions, with HLT registration.) We grossed $204,000 in memberships in 2015; the cost of processing and other membership services was about $22,200 (including credit-card fees), leaving a net income of $181,800 in this class.
(d) Miscellaneous income and operating expenses: Income here includes such things as interest on our bank accounts and bonds, and realized gains or losses from changes in the value of currencies. Expenses include office rent and utilities, insurance, bookkeeping and accounting, Business Manager's time not allocated to other specific classes, and the cost of maintaining the ACL Portal and ACL Anthology. Our net operating cost was $52,000. Covering these expenses from membership fees leaves us with about $130,000 for the costs of the two journals and our other activities.
Not shown on these spreadsheets, because they cut across a number of categories, are scholarships, sponsorships, and other awards. These include awards to students to attend conferences, the waiver of registration fees at conferences for student volunteers, and sponsorship of events organized by other CL and NLP organizations. These awards are made by the chapters from their subaccounts (in particular, NAACL's support of NACLO and of South American CL and NLP events), by central ACL through the Walker Fund, and by the organizers of student research workshops at conferences from funds that flow to us specifically for this purpose from sources such as the U.S. National Science Foundation and some of the conference sponsors (and hence may appear as conference income and expenses). In 2015, these awards totaled $21,800 in support by chapters for other events, $34,900 in support for student travel and conference registration, and an additional $22,100 in waived conference registration fees for student volunteers.