For perspective, let’s consider that any audit is not neces- sarily preordained to be as smooth as this 2020 one. ALOA’s staff, and especially our comptroller, are to be congratulated for keeping our books in good order and completely trans- parent. Unlike our infamous 2010 audit, where our organi- zation’s viability was in question, no issues were raised as to ALOA’s financial condition, despite the obvious adverse economic impact of the pandemic upon our F/Y 2020 per- formance. This is largely because ALOA had significantly strengthened its financial position in the 10-year period af- ter the 2010 bad news audit. Understandably, the auditors mentioned (in the “Uncertainties” narrative section of the financial statements report), the potential future impact of the COVID-19 pandemic and that “the related financial impact to the organization, if any, could not be determined at this time.” Next, let’s take a look at ALOA’s F/Y 2020 audited Statement of Activities, beginning with the Revenues section. Note that I’ve add- ed the corresponding numbers from the 2019 audit for comparison. ALOA - Statement of Activities Year ended December 31, 2020 Revenues: - in dollars F/Y 2020 F/Y 2019 Membership Dues and services Convention 2,145 Educational programs 133,235 Advertising Miscellaneous Promotional programs 20,584 5,048 Total revenues 196,443 Convention includes SAFETECH, the ALOA convention and — if applicable for that particular year — our Security Leaders (SF) events. Look at the comparison between 2019 and 2020 and you can readily see the financial impact of having to withdraw from all of our planned 2020 events. In a word: disastrous. Profits from such events are used to fund our magazines and other member benefits. It’s noteworthy that the pandemic, and thus our events cancellation carnage, continued well into 2021. Educational programs include all of the highly respected 1,211,697 1,283,682 (includes 3,500 legislative) 990,326 168,343 245,452 59,028 ________ _________ 1,569,152 2,750,911 4,080 (includes 50 interest) Next, let’s examine some of the primary categories in the Revenues section of this Statement of Activities and provide explanations and insights. Membership Dues comprise renewals (vast majority) plus new member dues. Keep in mind that a preponderance of next year’s dues is paid/collected in November and December of the current year. This is why our cash position looks so strong at year end when the financials are reported. But it’s important to remember that we incur lots of expenses all year long and thus have to live off our collected pile of dues cash for the balance of the new/next year. Fortunately, by the time the pandemic began to raise its ugly head, most of our F/Y 2020 dues had already been received in late 2019. WWW.ALOA.ORG teaching, certification and other classes offered by ALOA but does not include educational programs offered in connection with our SAFETECH, ALOA Convention or SL events, which are embedded within our Convention category. Obviously, the imposition of lockdowns, travel restrictions and social distancing mandates wreaked havoc upon our scheduled educational programs, especially our highly acclaimed sig- nature hands-on classes. But you’ll notice when comparing the year-over-year (YOY) numbers for this category that the shortfall wasn’t nearly as bad as could have been expected. That’s because the pandemic’s impact hit aſter the first quar- ter and our education team rapidly adapted and developed many online classes/webinars that were ultimately welcomed by strong member participation and endorsement. Obviously, we still incurred a significant budget and YOY shortfall, but this could have been much worse. Advertising income primarily represents ads sold in our two magazines, which are traditionally available in both print and digital form. Although no two years are the same and there are several other demand inf luences, it’s reason- able to conclude that our very reluctant expense mitigation decision to offer our magazines in digital form only for the last five months of 2020 contributed greatly to a material reduction in our ad revenue. A special thanks to madison/ miles media agency and our advertisers for minimizing the ad revenue falloff. So, as you can see by comparison of the YOY numbers listed on the Total revenues line, we took a huge revenue hit of about $1.2 million in F/Y 2020. This equates to a decline of about 43% in YOY revenues, most of which is related to our withdrawal from literally all of our F/Y 2020 events. Hopefully, some of the preced- ing commentary, coupled with the F/Y 2019 prior year numbers for comparison, have provided some insights into ALOA’s F/Y 2020 financial performance and specifically the impact of the COVID-19 pandemic. Now that we’ve examined the Revenues side, let’s move on to take a look at the Expenses side, found in the lower half of the Statement of Activities. SEPTEMBER 2021 KEYNOTES 13
