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Audited financial statements and supplementary information.

INDEPENDENT AUDITOR'S REPORT

TO THE EXECUTIVE COMMITTEE AMERICAN METEOROLOGICAL SOCIETY Boston, Massachusetts

Report on the Financial Statements

We have audited the accompanying financial statements of American Meteorological Society which comprise the statement of financial position as of December 31, 2015, and the related statements of activities, changes in net assets, and cash flows for the year then ended, and the related notes to the financial statements.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of American Meteorological Society as of December 31, 2015, and the changes in its net assets and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matters

Other Information

Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole. The accompanying schedule of expenditures of federal awards, as required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, is presented for the purposes of additional analysis and is not a required part of the financial statements. The accompanying schedule of net assets by restriction is presented for purposes of supplementary analysis and is also not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated August 1, 2016, on our consideration of American Meteorological Society's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering American Meteorological Society's internal control over financial reporting and compliance.

Burlington, Massachusetts

August 1, 2016
STATEMENT OF FINANCIAL POSITION

Assets
Current Assets:
  Cash                                                    $ 1,080,783
  Accounts receivable from members, subscribers and            10,459
    others
  Short-term investments                                    8,196,593
  Prepaid expenses and other current assets                 1,334,215
  Inventory                                                   174,891

Total Current Assets                                       10,796,941
Property and Equipment                                     11,487,274
Other Assets:
  Long-term investments                                       549,642

Total Assets                                             $ 22,833,857

Liabilities and Net Assets Current Liabilities:
  Bank line of credit                                       $ 500,000
  Current portion of long-term debt                           183,333
  Accounts payable and accrued expenses                       561,999
  Deferred income                                           3,915,835

Total Current Liabilities                                   5,161,167
Long-Term Liabilities:
  Charitable gift annuity liability                           152,651
  Fair value of interest rate swap agreement                  224,195
  Long-term debt, net of current portion                    4,384,722
  Commitments                                                      --

Total Long-Term Liabilities                                 4,761,568

Total Liabilities                                           9,922,735
Net Assets
  Unrestricted                                             10,523,223
  Temporarily restricted                                    1,745,196
  Permanently restricted                                      642,703

                                                           12,911,122

Total Liabilities and Net Assets                         $ 22,833,857

The accompanying notes are an integral part of the financial
statements.

STATEMENT OF FINANCIAL POSITION

Assets
Current Assets:
  Cash                                                    $ 1,080,783
  Accounts receivable from members, subscribers and            10,459
    others
  Short-term investments                                    8,196,593
  Prepaid expenses and other current assets                 1,334,215
  Inventory                                                   174,891

Total Current Assets                                       10,796,941
Property and Equipment                                     11,487,274
Other Assets:
  Long-term investments                                       549,642

Total Assets                                             $ 22,833,857

Liabilities and Net Assets Current Liabilities:
  Bank line of credit                                       $ 500,000
  Current portion of long-term debt                           183,333
  Accounts payable and accrued expenses                       561,999
  Deferred income                                           3,915,835

Total Current Liabilities                                   5,161,167
Long-Term Liabilities:
  Charitable gift annuity liability                           152,651
  Fair value of interest rate swap agreement                  224,195
  Long-term debt, net of current portion                    4,384,722
  Commitments                                                      --

Total Long-Term Liabilities                                 4,761,568

Total Liabilities                                           9,922,735
Net Assets
  Unrestricted                                             10,523,223
  Temporarily restricted                                    1,745,196
  Permanently restricted                                      642,703

                                                           12,911,122

Total Liabilities and Net Assets                         $ 22,833,857

The accompanying notes are an integral part of the financial
statements.

STATEMENT OF ACTIVITIES

YEAR ENDED DECEMBER 31, 2015

Unrestricted Net Assets:
  Revenues, Gains and Other Support:
    Publications                                          $ 7,995,664
    Meetings and exhibits                                   3,313,821
    Membership and communication                            2,049,159
    Other educational assistance                            1,702,345
    Federal financial assistance                            1,233,707
    Investment income                                         152,157
    Other contributions                                        79,750
    Net assets released from restrictions                      70,932
    Realized and unrealized (losses) on investments         (198,628)
    Unrealized gain on interest rate swap agreement            16,507

                                                           16,415,414

  Expenses:
  Program services:
    Publications                                            7,392,473
    Education and policy programs                           4,013,590
    Meetings and exhibits                                   3,212,042
    Membership and communication                            2,546,324
  Supporting services:
    Administrative and general                                471,824
    Interest expense                                          176,734

                                                           17,812,987

(Decrease) in Unrestricted Net Assets                     (1,397,573)
Temporarily Restricted Net Assets:
  Contributions                                                63,489
  Investment income                                            19,923
  Net assests released from restrictions                     (70,932)
  Realized and unrealized (losses) on investments            (10,268)

Increase in Temporarily Restricted Net Assets                   2,212
Permanently Restricted Net Assets:
  Investment income                                                 1

Increase in Permanently Restricted Net Assets                       1

(Decrease) in Net Assets                                  (1,395,360)
Net assets at beginning of year                            14,306,482

Net Assets at End of Year                                $ 12,911,122

The accompanying notes are an integral part of the financial
statements.

STATEMENT OF CHANGES IN NET ASSETS

YEAR ENDED DECEMBER 31, 2015

                                                          Temporarily
                                          Unrestricted     Restricted
                                           Net Assets      Net Assets

Balance at January 1, 2015               $ 11,920,796 $   1,742,984 $

Unrestricted Net Assets:
  Total unrestricted support,                16,415,414            --
    including net assets released
    from restrictions
  Expenses                                   17,812,987            --

(Decrease) in Unrestricted Net Assets       (1,397,573)

Temporarily Restricted Net Assets:
  Contributions                                      --        63,489
  Investment income                                  --        19,923
  Net assets released from                           --      (70,932)
    restrictions
  Realized and unrealized (losses) on                --      (10,268)
    investments

Increase in Temporarily Restricted                   --         2,212
  Net Assets

Permanently Restricted Net Assets:
  Investment income                                  --            --

Increase in Permanently Restricted
  Net Assets

Changes in Net Assets                       (1,397,573)         2,212

Balance at December 31, 2015             $ 10,523,223 $   1,745,196 $

                                           Permanently
                                           Restricted      Total Net
                                           Net Assets        Assets

Balance at January 1, 2015                    642,702 $    14,306,482

Unrestricted Net Assets:
  Total unrestricted support,                        --    16,415,414
    including net assets released
    from restrictions
  Expenses                                           --    17,812,987

(Decrease) in Unrestricted Net Assets                     (1,397,573)

Temporarily Restricted Net Assets:
  Contributions                                      --        63,489
  Investment income                                  --        19,923
  Net assets released from                           --      (70,932)
    restrictions
  Realized and unrealized (losses) on                --      (10,268)
    investments

Increase in Temporarily Restricted                   --         2,212
  Net Assets

Permanently Restricted Net Assets:
  Investment income                                   1             1

Increase in Permanently Restricted                    1             1
  Net Assets

Changes in Net Assets                                 1   (1,395,360)

Balance at December 31, 2015                  642,703 $    12,911,122

STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2015

Cash Flows from Operating Activities:
  (Decrease) in net assets                              $ (1,395,360)
  Adjustments to reconcile change in net assets to
      net cash provided by operating activities:
    Depreciation                                              271,073
    Unrealized and realized losses on investments             208,896
    Unrealized gain on interest rate swap agreement          (16,507)
  (Increase) decrease in:
    Accounts receivable                                       (8,502)
    Prepaid expenses and other current assets                 184,665
    Inventory                                                (12,972)
  (Decrease) increase in:
    Accounts payable and accrued expenses                    (97,260)
    Deferred income                                         (298,891)

Net Cash (Used in) Operating Activities                   (1,164,858)

Cash Flows from Investing Activities:
  Acquisition of property and equipment                     (420,952)
  Proceeds from sale of investments                           841,575
  Purchase of investments                                   (851,461)

Net Cash (Used in) Investing Activities                     (430,838)

Cash Flow from Financing Activities:
  Charitable gift annuity liability                           (7,825)
  Proceeds from bank line of credit                           500,000
  Payments on long-term debt                                (183,334)

Net Cash Provided by Financing Activities                     308,841

Net (Decrease) in Cash                                    (1,286,855)

Cash at beginning of year                                   2,367,638

Cash at End of Year                                       $ 1,080,783

Supplemental Disclosure for Cash Flows Information

Cash Paid During the Year for: Interest                     $ 176,734
  Income taxes                                                    $--


Note 1. Summary of Significant Accounting Policies:

Nature of activities: American Meteorological Society was formed in 1919. Interdisciplinary in scope, the Society actively promotes the development and dissemination of information on the atmospheric and related oceanic and hydrologic sciences.

Basis of accounting: The financial statements of American Meteorological Society have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and, accordingly, reflect all significant receivables, payables and other liabilities.

Basis of presentation: Under U.S. GAAP, the Society is required to report information regarding its financial position and activities according to three classes of net assets: unrestricted net assets, temporarily restricted net assets, and permanently restricted net assets.

Net asset categories are described as follows:

Unrestricted net assets include net assets that are not subject to donor-imposed stipulations.

Temporarily restricted net assets include net assets subject to donor-imposed stipulations that may or will be met by actions of the Society and/or the passage of time.

Permanently restricted net assets include contributions which require, by donor restrictions, that the principal be invested in perpetuity and only the income be made available for operations.

Deferred revenue: Revenues from membership dues and subscription fees are recognized over the periods to which the dues and fees relate. Revenues from page charges are recognized in the periods in which the page charges are earned.

Concentrations of credit risk: Financial instruments that potentially subject the Society to concentrations of credit risk consist primarily of cash (see Note 2) and temporary cash investments. By their nature, all such financial instruments involve risk, including the credit risk of nonperformance by counter parties and the maximum potential loss may exceed the amount recognized in the statement of financial position. At December 31, 2015, in management's opinion, there was no significant risk of loss from nonperformance of the counter parties to these financial instruments.

Donated services: No amounts have been reflected in the financial statements for donated services. The Society generally pays for services requiring specific expertise. However, many individuals volunteer their time and perform a variety of tasks that assist the Society with various programs and committee assignments.

Expense allocation: Expenses are charged to program and supporting services on the basis of periodic time and expense studies. Administrative and general expenses include those expenses that are not directly identifiable with any other specific function but provide for the overall support and direction of the Society.

Income tax status: The Society is exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code. However, income from certain activities not directly related to the Society's tax-exempt purpose is subject to taxation as unrelated business income.

In determining the recognition of uncertain tax positions, the Society applies a more-likely-than-not recognition threshold and determines the measurement of uncertain tax positions considering the amounts and probabilities of the outcomes that could be realized upon ultimate settlement with taxing authorities. As of December 31,2015, the Society has no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Society is not currently under examination by any taxing jurisdiction. The Society's federal and state tax returns are generally open for examination for three years following the date filed.

Inventory: Inventory, consisting of periodicals and books, is stated at the lower of cost, using the first-in, first-out method, or market.

Investments: The Society carries investments in marketable securities with readily determinable fair values and all investments in debt securities at their fair values in the Statement of Financial Position. Unrealized gains and losses are reflected in the accompanying Statement of Activities.

Promises to give: Unconditional promises to give are recognized as revenues in the period received. Unconditional promises to give that are expected to be collected within one year are recorded at net realizable value. Unconditional promises to give that are expected to be collected in future years are recorded at the present value of their future cash flows. The discounts on those amounts are computed using risk-adjusted interest rates applicable to the years in which the promises are received. Amortization of the discounts is included in contribution revenue. Conditional promises to give are recognized when the conditions on which they depend are substantially met. Uncollectible promises to give are expected to be insignificant and an allowance for uncollectible promises to give is not considered necessary.

There were no unconditional promises to give owed to the Society at December 31, 2015.

Property and equipment: Property and equipment are carried at cost or, if donated, at the approximate fair value at the date of donation. Depreciation is computed using primarily the straight-line method over the estimated useful lives of the assets which range from five to thirty-nine years. Additions and betterments of $2,000 or more are capitalized, while maintenance and repairs that do not improve or extend the useful lives of the respective assets are expensed currently.

The Society's land and buildings are located in a historical district and its original building is classified as a historical structure. The original property is considered to be a historical treasure that is worth preserving perpetually. The Society has the capacity to protect and preserve essentially the service potential of the land and building, and is doing so.

Restricted and unrestricted revenue and support: Contributions received are recorded as unrestricted, temporarily restricted or permanently restricted support, depending on the existence or nature of any donor restrictions.

Contributions that are restricted by the donor are reported as an increase in unrestricted net assets if the restriction expires in the reporting period in which the revenue is recognized. All other donor-restricted contributions are reported as an increase in temporarily or permanently restricted net assets, depending on the nature of the restrictions. When a restriction expires, temporarily restricted net assets are released to unrestricted net assets.

Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Derivative financial instruments: The Society makes use of derivative financial instruments for the purpose of managing interest rate risk. Derivative financial instruments are recorded at fair value.

Fair Values of Financial Instruments: U.S. GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP also establishes a framework for the measurement of fair value, and enhances disclosures about fair value measurements.

Interest rate swap agreements are valued at the net present value of future cash flows attributable to the difference between the contractual variable and fixed rates in those agreements adjusted for nonperformance risk of both the counterparty and the Society. The carrying value of all other financial instruments approximates fair value.

Advertising: The Society uses advertising to promote its programs, bulletins, journals, books and education materials among the audiences it serves. The production costs of advertising are expensed as incurred.

Date of Management's Review: The Society has evaluated subsequent events through August 1, 2016 which is the date the financial statements were available to be issued.

Note 2. Cash:

The Society places its cash in institutions which are insured by the Federal Deposit Insurance Corporation (FDIC). At times during the year, the bank balances may be in excess of the FDIC insurance limit of $250,000 per institution. At December 31,2015, the Society's bank balances exceeded the FDIC limit by approximately $484,900.

Note 3. Investments:

The Society's investments at December 31, 2015, which are held and managed by outside custodians, consist of stocks, mutual funds and invested cash, including money market funds.

U.S. GAAP establishes a fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy are as follows:

* Level 1 inputs are quoted prices (unadjusted) for identical investments in active markets.

* Level 2 inputs are quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

* Level 3 inputs are model derived valuations in which one or more significant inputs or significant value drivers are unobservable.

In certain cases, the inputs to measure fair value may result in an asset or liability falling into more than one level of the fair value hierarchy. In such cases, the determination of the classification of an asset or liability within the fair value hierarchy is based on the least determinate input that is significant to the fair value measurement. The Select Investment Program's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The following table summarizes the Society's financial assets measured at fair value on a recurring basis in accordance with U.S. GAAP as of December 31, 2015:
                               Level 1       Level 2        Level 3

U.S. corporate stock and     $ 6,725,093             $              $
  mutual funds
Certificates of deposit        1,069,264            --             --
Money market funds               487,274            --             --
Planned giving assets            464,604            --             --

                             $ 8,746,235             $              $

                                            Unrealized
                                 Cost         Gains       Fair Value

Invested cash                  $ 487,274             $      $ 487,274
Mutual funds                   4,862,803     1,844,090      6,706,893
Stocks                                 1        18,199         18,200
Gift annuities                   487,742      (23,138)        464,604
Certificates of deposit        1,069,264            --      1,069,264

                             $ 6,907,084   $ 1,839,151    $ 8,746,235

Included in the accompanying statement of financial position as
follows:
                                            Unrealized
                                 Cost         Gains       Fair Value

Short-term investments       $ 6,352,503   $ 1,844,090    $ 8,196,593
Long-term investments            554,581       (4,939)        549,642
                             $ 6,907,084   $ 1,839,151    $ 8,746,235

The following schedule summarizes the investment returns and their
classification in the statement of activities for the year ended
December 31, 2015:
                             Permanently   Temporarily
                              Restricted    Restricted   Unrestricted

Investment income                    $ 1      $ 19,923      $ 152,157
Realized gains on                     --        24,174         95,067
  investments
Unrealized gains (losses)             --      (34,442)      (293,695)
  on investments

                                     $ 1       $ 9,655     $ (46,471)


Note 4. Property and Equipment:
Property and equipment consists of the following:
  Land                                                $ 3,651,675
  Building and improvements                             8,769,745
  Office equipment and furniture                        2,179,425

                                                       14,600,845

Less accumulated depreciation                           3,113,571

                                                     $ 11,487,274


Note 5. Line of Credit:

The Society entered into a revolving line of credit agreement with Webster Bank National Association (the "Bank") in the amount of $500,000. As of December 31, 2015, there was $500,000 outstanding on the line of credit. The line of credit agreement contains financial and other covenants including a maximum leverage provision. At December 31, 2015, the Society was not in compliance with these covenants. However, the Society received a waiver from the bank of these covenants for the year ended December 31, 2015. The line of credit is secured and cross collateralized with the tax exempt bond financing and by a first security interest in all assets of the Society.

Note 6. Long-Term Debt:

The Society entered into a loan agreement with the Massachusetts Development Finance Agency, (the "Issuer"), a public instrumentality of the Commonwealth of Massachusetts in November 2010. The note was issued with bonds, by and among the Issuer, the Society, Webster Massachusetts Security Corporation, (the "Bondholder"), and Webster Bank National Association (the "Paying Agent"). The note is payable in monthly installments of $15,278 plus interest through November 2040. The interest rate on the note is set by the Paying Agent and will be reset from time to time. At December 31,2015, the interest rate was 3.7075%. The bond is secured by the land and building located at 44 Beacon Street, Boston, Massachusetts with a net book value of $7,169,634 at December 31, 2015.

The note is subject to the same covenants, security and cross collateralization as the line of credit (See Note 5).

Note 6. Long-Term Debt (Continued):

Maturities of long-term debt at December 31, 2015 consist of the following:
Year Ending
December 31:
2016             $ 183,333
2017               183,333
2018               183,333
2019               183,333
2020               183,333
Thereafter       3,651,390

               $ 4,568,055


Note 7. Split Interest Agreements:

The Society administers various charitable gift annuities. A charitable gift annuity provides for the payment of distributions to the grantor or other designated beneficiaries over the trust term (usually the designated beneficiary's lifetime). The portion of the gift annuity attributable to the present value of the future benefits to be received by the Society is recorded in the Statement of Activities as an unrestricted contribution in the period the gift annuity is established. Assets held in the various charitable gift annuities totaled approximately $464,600 at December 31, 2015 and are recorded at fair value in the Society's Statement of Financial Position.

On an annual basis, the Society revalues the liability to make distributions to the designated beneficiaries based on actuarial assumptions. The present value of the estimated future payments (approximately $152,600 at December 31, 2015) is calculated using a discount rate of 4.5% and applicable mortality tables.

Note 8. Interest Rate Swap Agreement:

U.S. GAAP requires certain derivative financial instruments to be recorded at fair value. An interest rate swap agreement is used by the Society to mitigate the risk of changes in interest rates associated with variable interest rate indebtedness. Under such arrangement, a portion of variable rate indebtedness is converted to fixed rates based on a notional principal amount.

The interest rate swap agreement is a derivative instrument that is required to be marked to market and recorded at fair value on the statement of financial position. At December 31,2015, the aggregate notional principal amount under the interest rate swap agreement, with a maturity of November 1, 2040, totaled $4,568,055. At December 31, 2015, the estimated fair value of the interest rate swap agreement was a liability of $224,195, and is classified on the statement of financial position as an interest rate swap agreement liability as of December 31, 2015.

As described in Note 3, U.S. GAAP establishes a fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value.
                     Level 1    Level 2    Level 3

Interest rate swap     $--     $ 224,195     $--


The change in fair value on this interest rate swap agreement was a gain of $16,507 for the year ended December 31, 2015, which is reflected as an unrealized gain on interest rate swap agreement in the accompanying statement of activities.

Note 9. Compensated Absences:

It is the Society's policy to reasonably estimate each year the amount of accrued vacation compensation that it anticipates to pay in the future. As of December 31,2015, the Society has an accrued liability of approximately $526,000 related to this policy, which is reflected in the statement of financial position.

Note 10. Program and Supporting Services:

The following program and supporting services are included in the accompanying financial statements:

Membership and Communication

Includes all primary member services, including, among others, the maintenance of the membership database, the certification programs and the publication of the Bulletin.

Journals

Includes the publication of the Society's primary journals [Journal of the Atmospheric Sciences, Journal of Applied Meteorology and Climatology, Monthly Weather Review, Journal of Physical Oceanography, Journal of Atmospheric and Oceanic Technology, Journal of Climate, Weather and Forecasting, Weather, Climate and Society, Journal of Hydrometeorology, and Earth Interactions electronic journal).

Meetings and Exhibits

Includes presenting various meetings throughout the year including the annual meeting and the related exhibits. It also includes short courses offered at the various meetings.

Books and Educational Materials

Includes the production and sale of books published by the Society, distribution throughout North America of WMO publications and sale of educational material for pre-college teachers.

Education and Policy Programs

Includes federal funding and Society support of nationally recognized programs using the study of the atmosphere and ocean to enhance or create an interest in pre-college students in science and engineering. Programs include, among others, AMS/NOAA Cooperative Program for Earth System Education, AMS Summer Policy Colloquium 2015-2018, AMS Climate Studies and Research Opportunities in Space and Earth Sciences. Policy programs work to strengthen the connection between public policy and Earth system science and services by building policy research and by creating opportunities for policymakers and scientists to engage and exchange perspectives to foster better-informed policy decisions.

Administrative and General

Includes the functions necessary to maintain a portion of an equitable employment program; ensure an adequate working environment; provide coordination and articulation of the Society's program strategy through the Office of the Executive Director; secure proper administrative functioning of the Council; maintain competent legal services for the program administration of the Society; and manage the financial and budgetary responsibilities of the Society.

Note 11. Retirement Plan:

The Society has a contributory retirement plan covering substantially all full-time employees. This is a tax deferred annuity plan under Section 403(b) of the U.S. Internal Revenue Code. The plan allows eligible employees to contribute 5% of their compensation through a salary reduction agreement.

The Society contributes 10% of compensation for participating employees. The expense for this plan amounted to $526,386 for the year ended December 31, 2015.

Note 12. Commitments:

The Society leases office space and equipment under various operating leases through March 2027. Under the terms of the office space lease, the Society is obligated to pay escalation rental for certain operating expenses and real estate taxes. Rental expense under the leases amounted to $561,000 for the year ended December 31, 2015 (including charges for operating expenses and taxes). The following is a schedule of future minimum rentals under the leases at December 31, 2015:
Year Ending December 31:
2016                           558,957
2017                           571,241
2018                           583,833
2019                           596,739
2020                           545,693
Thereafter                   3,709,499

                           $ 6,565,962


Note 13. Endowment Funds:

In accordance with the Uniform Prudent Management of Institutional Funds Act (UPMIFA), the Society is required to act prudently when making decisions to spend or accumulate donor restricted endowment assets and in doing so to consider a number of factors including the duration and preservation of its donor restricted endowment funds. The Society classifies as permanently restricted net assets the original value of gifts donated to the permanent endowment. The remaining portion of the endowment fund that is not classified in permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the Society in a manner consistent with the standard of prudence prescribed by UPMIFA.

The Society's endowment consists of approximately 65 individual funds established for a variety of purposes. Its endowment includes both donor-restricted endowment funds and funds designated by the Executive Committee to function as endowments. As required by generally accepted accounting principles, net assets associated with endowment funds including funds designated by the Executive Committee to function as endowments, are classified and reported based on the existence or absence of donor-imposed restrictions. When the donor's interest is not expressed in relation to the endowment fund, it is the policy of the Organization to record the income, interest, and dividends and accumulated appreciation/ depreciation in each endowment fund and appropriate expenditures from each fund in a prudent manner for the uses, benefits, purpose, and duration for which the endowment fund was established. As a result, the income earned each year for each endowment fund is reflected as either unrestricted, temporarily restricted or permanently restricted depending on the intent of the donor when the original gift was made.

Interpretation of Relevant Law: The Executive Committee of the Society has interpreted the Uniform Prudent Management of Institutional Funds Act (UPMIFA) as requiring the preservation of the fair value of the original gift as of the gift date on the donor-restricted endowment funds absent explicit donor stipulations to the contrary. As a result, the Society classifies as permanently restricted net assets (a) the original value of gifts donated to the permanent endowment, (b) the original value of subsequent gifts to the permanent endowment, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. The remaining portion of the donor-restricted endowment fund is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the Society in a manner consistent with the standards of prudence prescribed by UPMIFA. In accordance with UPMIFA, the Society considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds:

(1) The duration and preservation of the various funds.

(2) The purposes of the donor-restricted endowment funds.

(3) General economic conditions.

(4) The possible effect of inflation and deflation.

(5) The expected total return from income and the appreciation of investments.

(6) Other resources of the Society.

(7) The investment policies of the Society.

Return Objectives and Risk Parameters: The Society has adopted investment and spending policies approved by the Executive Committee for endowment assets that attempt to provide a predictable stream of funding to programs supported by its endowment funds while also maintaining the purchasing power of those endowment assets over the long-term.

Endowment assets include those assets of donor-restricted funds that the Society must hold in perpetuity or for a donor-specified period(s) as well as board-designated funds. Under this policy, as approved by the Executive Committee, the endowment assets are invested in a manner that is intended to contribute to the Society's total return objectives and preserve principal while maintaining a competitive yield as market conditions dictate.

Strategies Employed for Achieving Objectives: To satisfy its long-term rate-of-return objectives, the Society relies on a total return strategy in which investment returns are achieved through both capital appreciation (realized and unrealized) and current yield (interest and dividends). The Society targets a diversified conservative asset allocation including equity and marketable debt securities to achieve its long-term return objectives within prudent risk constraints.

Spending Policy and How the Investment Objectives Relate to Spending Policy: The Society's policy of appropriating for distributions of its endowment fund for scholarships, fellowships and other distribution of funds of approximately 3% to 5% is determined based on the donor's intentions and investment returns as well as taking into consideration the long-term expected return on its endowment, the nature and duration of the individual endowment funds, and the possible effects of inflation. Accordingly, over the long-term, the Society expects the current spending policy to allow its endowment to grow at a normal inflationary rate on an annual basis. This is consistent with the Society's objective to maintain the purchasing power of the endowment assets held in perpetuity or for a specific term as well as to provide additional growth through new gifts and investment return.
Endowment net assets composition by type of fund as of December
31, 2015:

                                               Board      Temporarily
                                             Designated    Restricted

Donor-restricted endowment funds                      $   $ 1,638,805
Board-designated endowment funds                779,881            --

                                              $ 779,881   $ 1,638,805

                                            Permanently
                                             Restricted      Total

Donor-restricted endowment funds            $ 642,703 $     2,387,899
Board-designated endowment funds                     --       779,881

                                            $ 642,703 $     3,167,780

Changes in endowment net assets for year ended December 31, 2015:

                                               Board      Temporarily
                                             Designated    Restricted

Endowment net assets, beginning of year     $ 1,422,902   $ 1,689,996
Investment return:
  Investment income                              31,439        19,923
  Net appreciation (depreciation)              (16,511)      (10,268)
    (realized and unrealized)

Total investment return                       1,437,830     1,699,651
Contributions                                   534,082        10,086
Appropriation of endowment assets for       (1,192,031)      (70,932)
  expenditure

Endowment net assets, end of year             $ 779,881   $ 1,638,805

                                            Permanently
                                             Restricted      Total

Endowment net assets, beginning of year       $ 642,702   $ 3,808,588
Investment return:
  Investment income                                   1        51,363
  Net appreciation (depreciation)                    --      (26,779)
    (realized and unrealized)

Total investment return                         642,703     3,833,172
Contributions                                        --       597,571
Appropriation of endowment assets for                --   (1,262,963)
  expenditure

Endowment net assets, end of year             $ 642,703   $ 3,167,780


Note 14. Restrictions on Net Assets:
Temporarily restricted net assets consists of contributions
presently available for use, but expended only for the
purposes specified by the donor. At December 31, 2015,
temporarily restricted net assets consist of the following:

Scholarship awards          $ 1,210,930
Hydrology research              170,437
Charitable gift annuities       144,028
Remote sensing awards            99,407
Lecture series awards            50,000
Student travel awards            62,991
Student paper awards              7,403

                            $ 1,745,196


Note 14. Restrictions on Net Assets (Continued:

Permanently restricted net assets consist of endowment fund assets to be held indefinitely.
SUPPLEMENTARY INFORMATION

SCHEDULE OF NET ASSETS BY RESTRICTION

YEAR ENDED DECEMBER 31, 2015

                             Balances       Receipts     Expenditures
                            January 1,      and Other      and Other
                               2015         Additions     Deductions

Unrestricted Net Assets:
  General                  $ 10,497,894             $--     $ 477,369
  Board designated funds
    Education                   907,622              --       690,322
    Rosen Gift Annuity          124,813          22,118            --
    Development                  94,328         209,237       210,609
    Saltzman                     84,124           1,005         5,145
    Cooper                       62,814             533         1,581
    Scholarship                  31,250          79,750        62,000
    75th Endowment               41,472             287            --
    Student Travel Fund          40,456             993         1,798
    Kalnay Gift Annuity          20,755           5,375         3,030
    Glahn                        15,476              --            --
    Witte Gift Annuity            7,987           6,463         1,541
    Atlas                         1,720           2,276            --
    Fellowship                 (15,685)         324,335       305,170
    Reeves                        1,071           4,532         3,000
    Roberts                       2,154              --            --
    Ooyama                        1,518             527            --
    Friday                          684             255            --
    Digiquartz                      321               1            --
    Hobbs                            22               1            --

Total Unrestricted
Net Assets                 $ 11,920,796       $ 657,688   $ 1,761,565

                                          Appreciation
                                         (Depreciation)
                                               in          Balances
                                           Fair Market     December
                               Total          Value        31, 2015

Unrestricted Net Assets:
  General                  $ 10,020,525     $ (277,183)   $ 9,743,342
  Board designated funds
    Education                   217,300              --       217,300
    Rosen Gift Annuity          146,931        (11,606)       135,325
    Development                  92,956              --        92,956
    Saltzman                     79,984           (966)        79,018
    Cooper                       61,766           (129)        61,637
    Scholarship                  49,000              --        49,000
    75th Endowment               41,759           (173)        41,586
    Student Travel Fund          39,651           (232)        39,419
    Kalnay Gift Annuity          23,100         (2,271)        20,829
    Glahn                        15,476              --        15,476
    Witte Gift Annuity           12,909                        11,773
    Atlas                         3,996         (1,136)         3,996
    Fellowship                    3,480              --         3,480
    Reeves                        2,603              --         2,603
    Roberts                       2,154              --         2,154
    Ooyama                        2,045              --         2,045
    Friday                          939              --           939
    Digiquartz                      322              --           322
    Hobbs                            23              --            23

Total Unrestricted
Net Assets                 $ 10,816,919     $ (293,696)  $ 10,523,223

                             Balances       Receipts      Expenditures
                             January        and Other      and Other
                             1, 2015        Additions      Deductions

Temporarily Restricted Net Assets:

Scholarship awards:
  Orville                    $ 392,578          $ 2,662         5,000
  Hagemeyer Unitrust           147,111            2,492         3,145
  NWSA                         133,045              263        10,000
  Baum                          82,975              480         5,000
  Ooyama                        70,438              200         2,000
  David Johnson                 64,284              797         3,145
  Houghton                      58,265              620            --
  L. Johnson                    56,240            2,433         2,000
  Vonnegut-Schaefer             57,874            1,044         5,145
  Roberts                       49,440                6         2,000
  Glahn                         47,946            1,668         2,500
  Friday                        36,117               --         2,500
  Grau                          34,861                6         5,000
  Reed                          18,442               97            --
  Merewether                     7,648                1            --
  Milham                         3,239               --            --
  Hanks Scholarship              2,939               53            --
  Wark                           7,438            3,056         5,145
  Namias                         2,347              647           145
  Hope                           1,710              385            --
  Digiquartz                       500               --            --
  Kreitzberg                     (792)              227         2,000
  Murphy                       (2,181)              364         2,000
  Schroeder                    (3,679)              688         5,000
Hydrology research:
  Horton                       169,434            1,525            --
Charitable gift annuities:
  Gift Annuities               138,181           27,679         3,545
Remote sensing awards:
  Atlas                        103,371            2,350         5,000
Lecture series awards:
  A. Gajdecki                       --           50,000            --
Student travel awards:
  Wesley                        34,859            1,588           408
  K. Spengler                    8,209            3,949            --
  Moyer                          8,341            2,201            --
  Spengler                       4,506               --           254
Student paper awards:
  Geotis                         4,268              102            --
  Leviton                        1,930                3            --
  Hobbs                            600               --            --
  Eaton                            500               --            --

Total Temporarily
Restricted Net Assets      $ 1,742,984        $ 107,586      $ 70,932

Permanently Restricted Net Assets:

Scholarship awards:
  Wark                       $ 250,000              $--           $--
  Schroeder                    100,000               --            --
  Hope                          50,000               --            --
  Namias                        50,000               --            --
  Murphy                        43,650               --            --
  Kreitzberg                    40,740               --             -
  Houghton                      25,000               --            --
  Vonnegut-Schaefer             24,072               --            --
  Jardine                       15,401               --            --
  Meisinger                     12,295               --            --
  Hanks Scholarship              5,000               --            --
  Milham                         5,000               --            --
Student paper awards and other
  Reed                          12,112               --            --
  Leviton                        5,000               --            --
  Geotis                         3,620               --            --
  Sverdrup                         812                1            --

Total Permanently
Restricted Net Assets        $ 642,702              $ 1           $--

                                          Appreciation
                                         (Depreciation)
                                               in           Balances
                                           Fair Market      December
                              Total           Value         31, 2015

Temporarily Restricted Net Assets:

Scholarship awards:
  Orville                    $ 390,240        $ (1,042)     $ 389,198
  Hagemeyer Unitrust           146,458          (5,686)       140,772
  NWSA                         123,308               --       123,308
  Baum                          78,455            (349)        78,106
  Ooyama                        68,638            (292)        68,346
  David Johnson                 61,936            (738)        61,198
  Houghton                      58,885            (199)        58,686
  L. Johnson                    56,673            (173)        56,500
  Vonnegut-Schaefer             53,773            (930)        52,843
  Roberts                       47,446               --        47,446
  Glahn                         47,114            (370)        46,744
  Friday                        33,617            (173)        33,444
  Grau                          29,867               --        29,867
  Reed                          18,539               --        18,539
  Merewether                     7,649               --         7,649
  Milham                         3,239               --         3,239
  Hanks Scholarship              2,992               --         2,992
  Wark                           5,349          (2,953)         2,396
  Namias                         2,849            (600)         2,249
  Hope                           2,095            (232)         1,863
  Digiquartz                       500               --           500
  Kreitzberg                   (2,565)               --       (2,565)
  Murphy                       (3,817)            (232)       (4,049)
  Schroeder                    (7,991)            (350)       (8,341)
Hydrology research:
  Horton                       170,959            (522)       170,437
Charitable gift annuities:
  Gift Annuities               162,315         (18,287)       144,028
Remote sensing awards:
  Atlas                        100,721          (1,314)        99,407
Lecture series awards:
  A. Gajdecki                   50,000               --        50,000
Student travel awards:
  Wesley                        36,039               --        36,039
  K. Spengler                   12,158               --        12,158
  Moyer                         10,542               --        10,542
  Spengler                       4,252               --         4,252
Student paper awards:
  Geotis                         4,370               --         4,370
  Leviton                        1,933               --         1,933
  Hobbs                            600               --           600
  Eaton                            500               --           500

Total Temporarily
Restricted Net Assets      $ 1,779,638       $ (34,442)   $ 1,745,196

Permanently Restricted Net Assets:

Scholarship awards:
  Wark                       $ 250,000              $--     $ 250,000
  Schroeder                    100,000               --       100,000
  Hope                          50,000               --        50,000
  Namias                        50,000               --        50,000
  Murphy                        43,650               --        43,650
  Kreitzberg                    40,740               --        40,740
  Houghton                      25,000               --        25,000
  Vonnegut-Schaefer             24,072               --        24,072
  Jardine                       15,401               --        15,401
  Meisinger                     12,295               --        12,295
  Hanks Scholarship              5,000               --         5,000
  Milham                         5,000               --         5,000
Student paper awards and other
  Reed                          12,112               --        12,112
  Leviton                        5,000               --         5,000
  Geotis                         3,620               --         3,620
  Sverdrup                         813               --           813

Total Permanently
Restricted Net Assets        $ 642,703              $--     $ 642,703
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Date:Oct 1, 2016
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