Budget FY 2014

Kim Rupert, CPCM, CFCM, FellowTysons Corner, VirginiaMarch 23, 2013

General Assumptions58% of Revenues Moderate to High or High Risk• Economic uncertainty remains – federal procurement budget in decline.• Severe Government constraints on conference attendance and travel • Income from all advertisement accounts continue to be at risk.• No significant new revenue streams per se, although Mid-Year leadership

conference reconfigured to focus on small business.• Budgeted surplus from operations is 1.0% (FY13 EAC prepared in January

2013 is -1.8%, FY12 Actual was 8.09%). • Excluding WC Nashville credit/concessions – Budgeted Loss from

Operations is -1.5%

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General Assumptions• Assumes no net revenue from investments (although

growth is possible).

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Revenue Assumptions• Revenue decrease over FY13 EAC prepared as of January 2013 is 7.1%.

– (13.2% decrease on FY13 budget)

• Membership -1.5%– Individuals, Groups, Pro Vita

• Education -4.1%– NES, E-learning, Virtual Conferences, partially offset by Webinars

• Advertising -4.8%– Resource Guide, CM Magazine, partially offset by higher Corporate Sponsorship

• Certification -1.2%– CPCM, CFCM, partially offset by ICCM and Exam Fees

• Meetings -16.6%– World Congress, GCMC, March Education/ADTF and Career Fairs

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Changes from FY2013 Meetings/Component Relations Refocus of ADTF (ADC) to March Education Conference

Small Business Conference to be held in lieu of Mid-Year Leadership Conference – now discontinued

Addition of two Chapter Training Conferences at GCMC and March Education Conference

Leadership Summit increased from 2.5 hours to 1.5 days – remains paired with WC Advertising

Resource Guide switching from print to digital Education

CMLDP Program suspended for FY 14

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Changes from FY2013 Certification

Industry Certification in Contract Management - DefenseIndustry Certification in Contract Management - Federal(Launched in January 2013)

Staff changes

Staff reduced by three in February 2013 (FY 13) affecting IT, Marketing and Creative Services

Transfer of Funds

Budget includes transfer of $25,000 to Building Fund but NO transfer to Restricted Funds.

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Salaries and benefits as % of revenueASAE Operating Ratio Report – 2010 Data (Latest Available)

FY14 Budget FY13 EAC FY12 FY11 FY10

NCMA 36.8% 37.5% 35.3% 31.0% 32.3%

$5m to $10m

Average 42.2%

Median 41.4%

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Number of employees (FTE’s)ASAE Operating Ratio Report – 2010 Data –(Latest Available)

FY14Budget

FY13 EAC FY12 FY11 FY10

NCMA 24.85 25.18 26.70 25.25 21.0

$5m to $10m

Average 37.0

Median 36.0

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Revenue per employeeASAE Operating Ratio Report – 2010 Data (Latest Available)

FY14 Budget

FY13 EAC FY12 FY11 FY10

NCMA $243,944 $259,102 $265,228 $276,156 $273,226

$5m to $10m

Average $229,975

Median $192,547

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RevenueBudget FY

14EAC FY 13 Variance

Membership 2,139,184 2,172,134 (32,950) (1.5%)

Component Relations 11,375 8,525 2,850 33.4%

Education 817,600 852,580 (34,980) (4.1%)

Advertising 1,145,910 1,203,649 (57,739) (4.8%)

Certification 248,020 250,977 (2,957) (1.2%)

Meetings 1,698,040 2,035,030 (336,990) (16.6%)

Total Revenue 6,060,129 6,522,895 (462,766) (7.1%)

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ExpensesBudget FY

14EAC FY 13 Variance

Governance 106,150 111,153 5,003 4.5%

Component Relations 142,266 139,669 (2,597) (1.9%)

Administration 1,927,434 2,127,571 200,137 9.4%

Marketing 631,519 538,595 (92,924) (36.3%)

Customer Service 295,695 259,116 (36,578) (14.1%)

Education 555,000 554,097 (902) (0.2%)

Creative Services 976,457 1,182,507 206,050 17.4%

Certification 164,770 159,061 (5,710) (3.7%)

Meetings 1,200,697 1,569,878 369,181 (23.5%)

Total Expenses 5,999,988 6,641,648 641,660 9.7%

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SummaryBudget FY

14EAC

FY 13 Variance

Revenue 6,060,129 6,522,895 (462,766) (7.1%)

Expenses 5,999,988 6,641,648 641,660 9.7%

Net from operations 60,141 (118,753) 178,894 150.6%

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FY 14 Net Income % is 1.0% - FY EAC Net Loss % is (1.8%). FY 12 Actual was 8.1%

Margins affected by World Congress penalties and concessions

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Costs incurred by cancellation of Pasadena contractsHilton Hotel 79,406Westin Hotel 34,000Pasadena Convention Center 16,638Sheraton Hotel 7,146Total 137,190All the above amounts have been agreed with the third parties with the exception the Pasadena Convention Center, who are claiming an additional $49,916 which would raise the cost to $187,106. NCMA and their third party advisors (Conference Direct) believe the claim has no basis.

WC July 2013 Conference Financial Effect of Move from Pasadena to Nashville – Penalties – FY 13 Expense

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Credits/Concessions from Gaylord OprylandRoom block credit – based on current budget 125,000Other credits – audio visual, marketing etc. 28,300Total 153,300This compares to cancellation costs of $137,190 to $187,106 depending on the Convention Center settlement. The budget assumes a 24% reduction in paid attendees from FY 13. The room block credit is on a sliding scale but the buffer between the budget and number negotiated means that the credit does not drop to next tier ($100K) until reduction is approximately 60%.Not quantified for here are any attendees who attend Nashville but may not have attended Pasadena because of travel/location etc.In addition Gaylord is providing many concessions/credits directly to attendees.

WC July 2013 Conference Financial Effect of Move fromPasadena to Nashville – Credits/Concessions – FY 14 Credit

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Operating Cash and Reserve Management • Cash on hand• Operating Cash Balance as of 3/19/13 - $1.66m• Line of Credit – Unused - $250K• Reserves• Total investments as of 3/18/13 - $2.85 million• Planned contribution of $100k to reserves in FY 13 (June) – Previous Transfers

• FY 12 $100K, FY 11 $300K, FY 10 $100K• FY 14 Budget incorporates

– NO transfer to Restricted Reserves.– $25,000 transfer to Building Fund – (Unrestricted Reserves)

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