Board Reports

Secretary-Treasurer's Report

Harry Strothers III, MD, MMM

I am happy to announce that after 6 years of deficits, the 2006 financial statement results show a turnaround from the deficit of $44,048 in 2005 to net income in 2006 of $24,660. The budget for 2006 had projected income of $2,457,250 and expenses of $2,456,245 for a projected net income of $1,005.

Achieving a net surplus did not come easily. The Society owes a debt of gratitude to a committed staff who achieved this result. The Board is very supportive of the staff, who were instrumental in our turnaround. The staff worked hard to retain and recruit new members, and we watched expenses closely and saved money wherever feasible. STFM is continually on the alert for new ways to generate revenue and to enhance traditional sources of revenue in ways that are consistent with our mission. All of these efforts paid off; please thank the STFM staff when you interact with them.

The financial performance measures adopted by the Board included five goals. For 2006, the results are:
• Maintain a balanced budget. Result: Achieved with a $24,660 net surplus.
• Maintain balanced budget within sectors. Result: Achieved in each sector. The sectors are publications, merchandise, grants, service contracts, and meetings.
• Cost of business operations not to exceed regular business income. Result: Not achieved with shortfall of $102,862. This goal will always be a challenge to meet as it has taken all areas of income, not just regular income, to overcome our deficits and return to black ink. We will continue to work toward this goal.
• Review fees and explore other income streams. Achieved and ongoing. Examples from 2006 include Board approval for increases in the nonmember conference registration rates, late registration fee amounts, and submission fees for nonmembers. Looking forward to 2007, examples of new income streams include a membership dues increase on an incremental scale for the next 5 years, the launch of the Predoctoral Directors Development Institute, and the launch of the Family Medicine Residency Preparation Academy.
• Maintain strategic reserve for emergency and opportunity funds. Achieved. We have 1 year of expenses in long-term reserves, and our goal is to maintain 6 months. We also met the earnings test for the Opportunity Fund and transferred the maximum amount available to the fund.

We have some big challenges for 2007. One will be to maintain our “black ink” while having to fund the Annals of Family Medicine from our regular operating budget. Our biggest challenge may be to stay on task while saying good-bye to our leader of 26 years, Executive Director Roger Sherwood, as he retires. Roger gives much of the credit for the 2006 turnaround to his staff, but they couldn’t have done it without his leadership.