TREASURER'S REPORT Mahadevappa Mahesh, PhD, Baltimore, MD

I am writing this column after attending the AAPM Annual Meeting in Denver CO. In this issue's column, I want to share the financial report I gave at the Annual Business Meeting. Fiscally, AAPM continues to perform well and ended the year with a surplus.

The Association realized a surplus from operations of approximately $422,000 in 2016 (Figure 1). For the year 2016, AAPM had budgeted for a deficit of approximately ~$1.38M, therefore lead to a favorable variance of $1.8M for 2016. The largest single driver contributing to this favorable variance was the $1M signing bonus received from Wiley, the new publisher of the AAPM journals. In addition, net under-spending and a slight increase in revenues by councils and committees contributed $723,000 towards the favorable variance. Additionally, the Annual Meeting held in Washington DC performed very well contributing $423,000 over budgeted targets. The surplus from operations enabled AAPM to comply with the Debt Service Coverage Ratio (DSC) of 1.2 to 1 covenant requirement as a part of AAPM's building financing with TD Bank. For the year ending December 31, 2016, AAPM's DSC ratio was 2.46 to 1.

AAPM's balance sheet is strong as of the end of the year 2016, with total assets exceeding $23.8M. This represents an increase of approximately $400,000 over the prior year (2015). AAPM's investments performed very well in 2016, for the year, we had unrealized gains of approximately $703,000. At year end reserve balances stood at nearly $12.6M (Figure 2). Continued strong performance in the first two quarters of 2017 raised reserve balances to $12.8M. Even though this balance represents a decrease of $500,000 at the same point in time in the prior year, this is especially impressive as the Board approved two transfers from investments during this period. In August 2016, the Board approved a transfer of $1.2M to replenish operating cash used in the purchase of the headquarters building. In addition, the Board also approved a transfer in March 2017 of $660,000 for the purchase of the new Association Management System (AMS) and Financial Management System (FMS).

The 2017 budget has an approved deficit of ($1.2M). The reason for approving deficit budget was discussed in my column earlier this year in the July/August issue. This budget was prepared utilizing a statistical model, using historical budgets and operating results as a guide. The model assumes that AAPM will finish the year in compliance with the DSC covenant requirements of TD Bank. At the present time, the Association is working on the budget for 2018. All councils and committees are invited to prepare their respective budgets and submit them before the end of August. FINCOM will meet on October 18, 2017 to review and approve the 2018 budget.

If you have any questions related to this column please feel free to reach out to me by email, Twitter, or call me at 410-955-5115. I would like to thank Robert A. McKoy, AAPM Director of Finance, for his contribution of the subject matter to this column.