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Financial success is key to member benefits and services
JANUARY 1998, VOL 67, NO 1 TR F A SU R EK ‘S R EP0R T
Financial success is key to member benefits and services
T
he 1996-1997 fiscal year ended on June 30,1997, on a very successful financial note with growth in the following areas: total revenues increased by 14%, net income increased by 35%, advertising income increased by 14%, m revenues for Opportunity increased by 183%, m Association Technology Solutions (ATS) exceeded $700,000 in sales, and ta cash and investmentsincreased by 38%. Positive growth in these areas continues to ensure a strong organization and translates into more benefits and services for our members. DlVERSlFlCATlON CONTRIBUTES TO FlNANClAt STRENGTH In 1995, the Board of Directors approved principles by which diversificationstrategies could be initiated. The primary reason for diversificationwas, and continues to be, a mechanism for decreasing our reliance on Congress-related income and to supplement our dues revenue. Congress registration and revenue from Congress exhibits totaled 3 1% of AORN’s total revenues for fiscal year 1997 (Figure 1). AORN continues to count on revenues generated from sources other than members to be able to provide the current level of services. Currently, AORN members receive $1.61 of product and ser-
vices for every $1 spent. AORN needs to make up the $0.61 through other sources. The purchase of Education Design, Inc (EDI), in 1996 was the Association’s first diversified strategic initiative. Education Design, Inc, is organized as a wholly owned, for-profit subsidiary of AORN. To ensure a link between AORN, the parent company, and the new EDI, a member of the AORN Board of Directors serves on the ED1 board. At the October meeting, the Board approved the spinoff of ATS into a second for-profit subsidiary. It is expected that this transaction will be completed by Jan 1,1998. The rationale for this decision was due primarily to increasing growth in sales and to ensure that AORN’s nonprofit (501[c][6]) status is not jeopardized due to increasing taxable revenues. In keeping with the Board’s commitment to ensure links between the for-profit subsidiaries and AORN, Board members approved the appointment of the sitting treasurer to the ATS board. RELATIONSHIP OF FOR-PROFIT SUBSIDIARIES Education Design, Inc, and ATS contribute to the overall financial goals for AORN through the purchase of products and services from AORN. Income from rent, information systems support, and human resources support are examples 32 AORN JOURNAL
of what these entities purchase from the organization. In turn, the revenues realized from this relationship directly affect AORN’s profitability. Additionally, there are significant tax advantages to having these subsidiary companies organized as for-profit entities. All this activity and the related revenues flow back to members in the form of new products and services, and additional human resources support those products and services and help keep our dues low. OTHER CONTRIBUTIONS Diversification is not the only reason for A 0 R ” s financial success. The incorporation of business plans related to new products and services has enabled AORN to make more informed decisions and to better evaluate the return on investment for proposed projects. The AORN Board of Directors, committees, and specialty assemblies continue to meet the challenge of doing business differently, which has resulted in the streamlining of many activities. Conference calls, shorter meetings, and the use of e-mail now are commonplace. Task forces and project teams come together to focus on short-range issues, or to meet a specified need, and then are disbanded. The role of Headquarters staff members in meeting the Association’s financial goals cannot be underestimated. Departments routinely monitor budget parameters,
JANUARY 1998, VOL 67, NO 1
Figure 1
and cost-effective manner. Additionally, the Treasurer and Board members receive monthly budget reports, including an explanation of variances. These are reviewed, questioned when necessary, and used
Breakdown of revenue by category.
being ensure that gods and are able to fully explain variances. It is this routine activity that enables daily operations to be conducted in the most appropriate
to assist in decision making throughout the fiscal year. me ~~d has esmbl j s h d a godof an mud net income of 3% to 5% beginning with the 1997-1998fiscal
A sound investment policy continues to work toward ensuring a future financial security. Current strategies include increasing our reserves and investment portfolio and paying off the Headquarters building. SUMMARY Financial strength enables AORN to provide quality products and services and to continually look for new ways of meeting the needs of members. Partnerships between and among Headquarters staff members, Board members, and other Association volunteers are critical to ensuring financial success now and in the future. SHERI VOSS RN, BS, CNOR TREASURER
Foundation Congress Activities The AORN Foundation booth will be located in the registration area and in the AORN booth on the exhibit floor during exhibit hours. Foundation staff members and trustees will be at the booths to answer members' questions. AORN Scholarship Committee members will be at the Foundation booth to answer any questions regarding scholarships and grants. The 1998-1999fall term, scholarship applications,and guidelines will be available at the booth. Please stop by the Foundation booth to meet the staff members, trustees, and Scholarship Committee members. The Foundation also will sponsor the following activities. Chapter and State Council Challenge. All chapters and state councils that have contributed to the Foundation from July 1,1997, through Congress, will be recognized at the Foundation booth. Daily drawings. The Foundation will be holding daily drawings for anyone who contributes to the Foundation during Congress week. Membership for Life. For every 1,000 members who contribute a minimum of $25 annually to the Foundation, their names will be entered into a drawing to have their national dues paid for life.
Drawings will take place at Congress, and you need not be present to win. Scholarship lunch. Wednesday, April 1, the Foundation will host a lunch for the 1997-1998 scholarship recipients and corporate donors. This will give the recipients an opportunity to personally meet and thank their corporate donor. Black Tie Gala. The Foundation Black Tie Gala will be Wednesday evening, April 1, at the Citrus Club. The dinner will recognize donors who contributed $l,OOO or more during the 1996-1997fiscal year. Individuals and chapters who have contributed $500 or more and corporate donors'who have contributed $1,OOO or more during the 1996-1997 fiscal year will be invited. The cost is $100 per person. 5K run. The Foundation will sponsor a 5K run fund raising event for all Congress attendees, Thursday, April 2,6:30 AM, at the Pointe Orlando across from the Convention Center. The entry fee is $20 per person, which includes an official race t-shirt. For more information or an official race entry form, or any other Foundation activities, contact the AORN Foundation at (800) 755-2676 x 8229 or tbarlow@ aom.org.
33 AORN JOURNAL
Financial success is key to member benefits and services
T
he 1996-1997 fiscal year ended on June 30,1997, on a very successful financial note with growth in the following areas: total revenues increased by 14%, net income increased by 35%, advertising income increased by 14%, m revenues for Opportunity increased by 183%, m Association Technology Solutions (ATS) exceeded $700,000 in sales, and ta cash and investmentsincreased by 38%. Positive growth in these areas continues to ensure a strong organization and translates into more benefits and services for our members. DlVERSlFlCATlON CONTRIBUTES TO FlNANClAt STRENGTH In 1995, the Board of Directors approved principles by which diversificationstrategies could be initiated. The primary reason for diversificationwas, and continues to be, a mechanism for decreasing our reliance on Congress-related income and to supplement our dues revenue. Congress registration and revenue from Congress exhibits totaled 3 1% of AORN’s total revenues for fiscal year 1997 (Figure 1). AORN continues to count on revenues generated from sources other than members to be able to provide the current level of services. Currently, AORN members receive $1.61 of product and ser-
vices for every $1 spent. AORN needs to make up the $0.61 through other sources. The purchase of Education Design, Inc (EDI), in 1996 was the Association’s first diversified strategic initiative. Education Design, Inc, is organized as a wholly owned, for-profit subsidiary of AORN. To ensure a link between AORN, the parent company, and the new EDI, a member of the AORN Board of Directors serves on the ED1 board. At the October meeting, the Board approved the spinoff of ATS into a second for-profit subsidiary. It is expected that this transaction will be completed by Jan 1,1998. The rationale for this decision was due primarily to increasing growth in sales and to ensure that AORN’s nonprofit (501[c][6]) status is not jeopardized due to increasing taxable revenues. In keeping with the Board’s commitment to ensure links between the for-profit subsidiaries and AORN, Board members approved the appointment of the sitting treasurer to the ATS board. RELATIONSHIP OF FOR-PROFIT SUBSIDIARIES Education Design, Inc, and ATS contribute to the overall financial goals for AORN through the purchase of products and services from AORN. Income from rent, information systems support, and human resources support are examples 32 AORN JOURNAL
of what these entities purchase from the organization. In turn, the revenues realized from this relationship directly affect AORN’s profitability. Additionally, there are significant tax advantages to having these subsidiary companies organized as for-profit entities. All this activity and the related revenues flow back to members in the form of new products and services, and additional human resources support those products and services and help keep our dues low. OTHER CONTRIBUTIONS Diversification is not the only reason for A 0 R ” s financial success. The incorporation of business plans related to new products and services has enabled AORN to make more informed decisions and to better evaluate the return on investment for proposed projects. The AORN Board of Directors, committees, and specialty assemblies continue to meet the challenge of doing business differently, which has resulted in the streamlining of many activities. Conference calls, shorter meetings, and the use of e-mail now are commonplace. Task forces and project teams come together to focus on short-range issues, or to meet a specified need, and then are disbanded. The role of Headquarters staff members in meeting the Association’s financial goals cannot be underestimated. Departments routinely monitor budget parameters,
JANUARY 1998, VOL 67, NO 1
Figure 1
and cost-effective manner. Additionally, the Treasurer and Board members receive monthly budget reports, including an explanation of variances. These are reviewed, questioned when necessary, and used
Breakdown of revenue by category.
being ensure that gods and are able to fully explain variances. It is this routine activity that enables daily operations to be conducted in the most appropriate
to assist in decision making throughout the fiscal year. me ~~d has esmbl j s h d a godof an mud net income of 3% to 5% beginning with the 1997-1998fiscal
A sound investment policy continues to work toward ensuring a future financial security. Current strategies include increasing our reserves and investment portfolio and paying off the Headquarters building. SUMMARY Financial strength enables AORN to provide quality products and services and to continually look for new ways of meeting the needs of members. Partnerships between and among Headquarters staff members, Board members, and other Association volunteers are critical to ensuring financial success now and in the future. SHERI VOSS RN, BS, CNOR TREASURER
Foundation Congress Activities The AORN Foundation booth will be located in the registration area and in the AORN booth on the exhibit floor during exhibit hours. Foundation staff members and trustees will be at the booths to answer members' questions. AORN Scholarship Committee members will be at the Foundation booth to answer any questions regarding scholarships and grants. The 1998-1999fall term, scholarship applications,and guidelines will be available at the booth. Please stop by the Foundation booth to meet the staff members, trustees, and Scholarship Committee members. The Foundation also will sponsor the following activities. Chapter and State Council Challenge. All chapters and state councils that have contributed to the Foundation from July 1,1997, through Congress, will be recognized at the Foundation booth. Daily drawings. The Foundation will be holding daily drawings for anyone who contributes to the Foundation during Congress week. Membership for Life. For every 1,000 members who contribute a minimum of $25 annually to the Foundation, their names will be entered into a drawing to have their national dues paid for life.
Drawings will take place at Congress, and you need not be present to win. Scholarship lunch. Wednesday, April 1, the Foundation will host a lunch for the 1997-1998 scholarship recipients and corporate donors. This will give the recipients an opportunity to personally meet and thank their corporate donor. Black Tie Gala. The Foundation Black Tie Gala will be Wednesday evening, April 1, at the Citrus Club. The dinner will recognize donors who contributed $l,OOO or more during the 1996-1997fiscal year. Individuals and chapters who have contributed $500 or more and corporate donors'who have contributed $1,OOO or more during the 1996-1997 fiscal year will be invited. The cost is $100 per person. 5K run. The Foundation will sponsor a 5K run fund raising event for all Congress attendees, Thursday, April 2,6:30 AM, at the Pointe Orlando across from the Convention Center. The entry fee is $20 per person, which includes an official race t-shirt. For more information or an official race entry form, or any other Foundation activities, contact the AORN Foundation at (800) 755-2676 x 8229 or tbarlow@ aom.org.
33 AORN JOURNAL