The 2008-2009 JREF 990 form has been released for some months now, I confess to thinking that someone would have made a thread about it much sooner than this but I seem to have been wrong. Given this dearth, I shall create one because the form offers a very interesting insight into the organization's most current operational methodology and financial strength. As always, a copy of the form can be pulled from GuideStar (requires registration, it's free). A direct link to the JREF's entry in said website is here: http://www2.guidestar.org/ReportNonProfit.aspx?ein=65-0649443&Mode=GxLite&lid=523196&dl=True
Not wasting any time with preambles, Form 990 has a summary and comparison with the previous year found on page one. Program service revenue is particularly notable for the 2008-2009 year, having more than doubled from the previous year – a sign of particularly good tidings. Given the recent economic disasters, a loss in investment revenue is unsurprising though I must confess that an $11,600 (roughly 17% give or take) is a bit troubling. For a conservative investment that's a pretty serious hit. “Other revenue” is a catchall category (relative to the JREF, it probably includes merchandise sales and things of that nature, “incidental monies” is a term I keep hearing to describe this) but a $12,000 increase in this category is hardly a bad sign. Public contributions have gone up as well, though not by as significant of an increase as the other categories. I caution strongly putting too much faith in this category however, it is probably better used to judge public interest and expansion of clientele rather than the overall fiscal status of the organization. A much more detailed breakdown of revenue is provided in Part VIII of the document, but it offers very little new information.
Organizational expenses have skyrocketed. Given their hiring of Phil during this time, it is hardly surprising to see an increase in salarial expenses, but the general category “other expenses” has mysteriously doubled, and the categorical name offers no insights as to why. To find this out, we must travel down to Part IX, helpfully titled “Statement of Functional Expenses.” The rather exorbitant amount of money paid for “conferences, conventions and meetings” accounts for approximately half of organizational expenditure, given the JREF's penchant for hosting many meetings throughout the year this makes sense. The fees paid for “office expenditures” (lines 24b-d in Part IX) seem to be increasing year after year, but this is no surprise. The full itemization of expenses is present and reasonably self-explanatory, though the amount of advertising expenses suggests that some targeted advertising is going on.
Anyone desiring to shortcut a great deal of analytical work should skip to the summary, found on lines 20-22 of Part I. The astoundingly low liability total suggests that the organization has taken cost-cutting measures, but the greatest reason for this exceptionally low total is found on Line 8 of Part X – the JREF had prepaid a great deal of its liabilities for the current fiscal year in the previous fiscal year, a very good strategical business maneuver. An even briefer summarization is Line 19, Part I - “Revenue less expenses.” If this number goes up, organizational activities are paying for themselves and turning a profit for the organization. This is exactly what you want to see in any organization because it speaks to overall sustainability of operation – answers to the question “What will happen to the JREF when Randi dies?” will ultimately be evaluated for validity from the information contained on this line.
The balance sheet that constitutes Part X is very informative in regards to how the JREF is handling its assets and liabilities, it is a comparatively more in-depth look at the information given in the preceding sections with particular emphasis upon specific types of assets and liabilities. Upon examination of the EOTFY (end of the fiscal year) numbers, a surprising amount of information can be garnered that is of use to the potential investor or anyone with an interest in determining the JREF's current business strategy and method of handling the economic downturn.
“Consolidation” and “streamlining” are two of the buzzwords in the field of business consulting at the moment, with everyone seeking to save money it's not a surprise to see the JREF following suit. The JREF, however, is being much more proactive with its method of consolidation in that it is putting revenue into temporary investments and savings, rather than the more common (in better times) and higher-yielding long-term securities and bonds. For a non-profit with a fairly consistent outflow of raw cash this makes sense – the JREF has to spend money to make money in that it has few contractual sources of persistent revenue. Putting spare revenues into temporary savings also affords a good deal of potential for growth later once businesses begin seeking to expand – the JREF will have the resources on hand and immediately available to do so. The practical halving of the value of the JREF's publically-traded securities suggests that the JREF cut its losses and put most of the profits from sales of these securities into cash investments, though I'd expect to see some of this money reinvested during the current fiscal year as raw value increases.
It's also been necessary to streamline operational expenses, judging by the JREF's inventory decrease and rapid decline in prepaid expenses they are planning to use this fiscal year as a benchmark for determining raw operational cost. The increases in savings can also be used to rapidly pay these expenses when the need arises. Calling in deferred revenue has also helped expand their temporary asset base, and the minimization of overall liabilities seems to have been quite successful, at least in the short term. One can infer from the stockpiling of cash resources that the JREF expects the economy to begin slowly recovering soon and is planning accordingly.
Overall, the JREF has handled the 2008-2009 fiscal year quite well. The asset base certainly took a significant hit (roughly 10% from the previous year) from the economic downturn, but they have succeeded in controlling their expenses quite thoroughly and are quite fiscally conservative in their ways. The operational sustainability of the organization is quite strong with few reasons to worry from a fiscal standpoint.
~ Matt
Not wasting any time with preambles, Form 990 has a summary and comparison with the previous year found on page one. Program service revenue is particularly notable for the 2008-2009 year, having more than doubled from the previous year – a sign of particularly good tidings. Given the recent economic disasters, a loss in investment revenue is unsurprising though I must confess that an $11,600 (roughly 17% give or take) is a bit troubling. For a conservative investment that's a pretty serious hit. “Other revenue” is a catchall category (relative to the JREF, it probably includes merchandise sales and things of that nature, “incidental monies” is a term I keep hearing to describe this) but a $12,000 increase in this category is hardly a bad sign. Public contributions have gone up as well, though not by as significant of an increase as the other categories. I caution strongly putting too much faith in this category however, it is probably better used to judge public interest and expansion of clientele rather than the overall fiscal status of the organization. A much more detailed breakdown of revenue is provided in Part VIII of the document, but it offers very little new information.
Organizational expenses have skyrocketed. Given their hiring of Phil during this time, it is hardly surprising to see an increase in salarial expenses, but the general category “other expenses” has mysteriously doubled, and the categorical name offers no insights as to why. To find this out, we must travel down to Part IX, helpfully titled “Statement of Functional Expenses.” The rather exorbitant amount of money paid for “conferences, conventions and meetings” accounts for approximately half of organizational expenditure, given the JREF's penchant for hosting many meetings throughout the year this makes sense. The fees paid for “office expenditures” (lines 24b-d in Part IX) seem to be increasing year after year, but this is no surprise. The full itemization of expenses is present and reasonably self-explanatory, though the amount of advertising expenses suggests that some targeted advertising is going on.
Anyone desiring to shortcut a great deal of analytical work should skip to the summary, found on lines 20-22 of Part I. The astoundingly low liability total suggests that the organization has taken cost-cutting measures, but the greatest reason for this exceptionally low total is found on Line 8 of Part X – the JREF had prepaid a great deal of its liabilities for the current fiscal year in the previous fiscal year, a very good strategical business maneuver. An even briefer summarization is Line 19, Part I - “Revenue less expenses.” If this number goes up, organizational activities are paying for themselves and turning a profit for the organization. This is exactly what you want to see in any organization because it speaks to overall sustainability of operation – answers to the question “What will happen to the JREF when Randi dies?” will ultimately be evaluated for validity from the information contained on this line.
The balance sheet that constitutes Part X is very informative in regards to how the JREF is handling its assets and liabilities, it is a comparatively more in-depth look at the information given in the preceding sections with particular emphasis upon specific types of assets and liabilities. Upon examination of the EOTFY (end of the fiscal year) numbers, a surprising amount of information can be garnered that is of use to the potential investor or anyone with an interest in determining the JREF's current business strategy and method of handling the economic downturn.
“Consolidation” and “streamlining” are two of the buzzwords in the field of business consulting at the moment, with everyone seeking to save money it's not a surprise to see the JREF following suit. The JREF, however, is being much more proactive with its method of consolidation in that it is putting revenue into temporary investments and savings, rather than the more common (in better times) and higher-yielding long-term securities and bonds. For a non-profit with a fairly consistent outflow of raw cash this makes sense – the JREF has to spend money to make money in that it has few contractual sources of persistent revenue. Putting spare revenues into temporary savings also affords a good deal of potential for growth later once businesses begin seeking to expand – the JREF will have the resources on hand and immediately available to do so. The practical halving of the value of the JREF's publically-traded securities suggests that the JREF cut its losses and put most of the profits from sales of these securities into cash investments, though I'd expect to see some of this money reinvested during the current fiscal year as raw value increases.
It's also been necessary to streamline operational expenses, judging by the JREF's inventory decrease and rapid decline in prepaid expenses they are planning to use this fiscal year as a benchmark for determining raw operational cost. The increases in savings can also be used to rapidly pay these expenses when the need arises. Calling in deferred revenue has also helped expand their temporary asset base, and the minimization of overall liabilities seems to have been quite successful, at least in the short term. One can infer from the stockpiling of cash resources that the JREF expects the economy to begin slowly recovering soon and is planning accordingly.
Overall, the JREF has handled the 2008-2009 fiscal year quite well. The asset base certainly took a significant hit (roughly 10% from the previous year) from the economic downturn, but they have succeeded in controlling their expenses quite thoroughly and are quite fiscally conservative in their ways. The operational sustainability of the organization is quite strong with few reasons to worry from a fiscal standpoint.
~ Matt