Treasurer’s Report 2021
Published: December 8, 2021
Elisabeth Bradley Bristol-Myers Squibb Company Princeton, New Jersey, USA INTA Board of Directors
As I end my term as INTA Treasurer, I am pleased to report that although 2021 has been another challenging year, our Association continues to be in sound financial standing.
The 2021 “new budget,” adopted by the Board of Directors in March, reflected the financial impact of this year’s Annual Meeting Virtual+, and projected a net loss (that is, total revenue minus total expenses) of $1.9 million. I am pleased to report that the budget will be achieved in spite of still very uncertain times. INTA’s staff continues to work extremely diligently and has been successful with the transition to a virtual platform for both Annual and Leadership Meetings the past two years.
Significant financial activities in 2021 include the settlement of the 2020 Singapore Annual Meeting insurance claim which resulted in $5.25 million of income, as well as receipt of a Paycheck Protection Program loan from the Small Business Administration in the amount of $1.3 million as part of the U.S. government’s CARES Act.
The transition from the San Diego Hybrid Annual Meeting, which was initially budgeted to generate $6.3 million of net revenue in 2021, to the Annual Meeting Virtual+ with expected net revenue of $1.1 million, has created significant liquidity constraints for the Association. As a result, cash management has been a top priority for the Finance Committee in 2021.
Once the Association became eligible for the Paycheck Protection Program loan, the Finance Department worked closely with our banking partners at JPMorgan Chase and secured a $1.3 million loan which we fully expect to have forgiven based on the requirements determined by the U.S. government. Additionally, the $5.25 million Singapore insurance settlement received in March significantly enhanced our cash position and was utilized to fund ongoing operating expenses.
As a result of the insurance settlement and Paycheck Protection Program loan, we did not liquidate assets from the Reserve Fund in 2021 until August of this year, when we sold $1.5 million of assets. We feel very positive about the performance of our Reserve Fund during the past two years. The 2019 ending balance was $25.8 million, the 2020 ending balance was $22.2 million, and, as of the end of October, the current balance is $23.5 million. Considering the adverse impact the pandemic has had on our ability to hold in-person events and that we have liquidated $7.0 million from the Reserve Fund over the past two years, we feel we are in a very strong position going forward.
Additionally, we have begun to pay down our $5.0 million line of credit which was established in March of 2020, such that by the end of this year our balance will be $4.5 million.
We maintained an overall 80 percent membership retention rate in 2021, added 567 new members, and continue to have close to 6,000 organizational members around the world. Our 2021 membership dues revenue of just over $5 million combined with the $5.25 million insurance settlement were our two primary sources of revenue in 2021. When we prepared the original 2021 budget, we assumed that paid attendance at the San Diego Hybrid Annual Meeting would be approximately 7,000 registrants, and that that Meeting would generate $6.3 million of net revenue. The 2021 Annual Meeting Virtual +, which will have more than 3,000 registrants, will generate approximately $1 million of net revenue.
2021 marks the fourth and final year of the 2018–2021 Strategic Plan. The management team continues to promote the goals established in that Strategic Plan, including the value of trademarks and brands, reinforcing consumer trust, and embracing innovation and change.
Conferences and meetings were significantly impacted by COVID-19 in 2021, as all in-person conferences and the TMAP meeting were canceled. We were successful with the virtual Leadership Meeting and the virtual Brand Resilience Conference. We continue to convey an important set of messages to our members, prospective members, and government agencies around the globe of our commitment to education, advocacy, and public policy in all regions. The platform for future events may continue to have a virtual component or may be completely virtual depending on the continued impact of COVID-19, but the Association’s staff now has the required experience and knowledge to make future events successful for members regardless of the platform.
Our Association’s staff continued to demonstrate their ability to manage operating expenses during 2021. Total expenses for the Association, which were forecasted to be $17.0 million, will be lower than budget by $0.3 million.
As of the end of October, the Reserve Fund balance was $23.5 million, $1.4 million higher than at the beginning of the year. During 2021, the Finance Committee has been diligently monitoring and reviewing performance with our investment advisors at JPMorgan Chase. Although global markets continue to be volatile and there are many factors impacting investment returns, we believe the portfolio is appropriately diversified and the expectation is that the portfolio will continue to move with the relevant market indices. The YTD return of 7.5 percent through September is in line with our benchmark portfolio.
The 2022 budget, which will be presented to the Board of Directors today, will reflect membership retention of 85 percent, which is consistent with pre-pandemic levels. Three budget scenarios will be presented to the Board, each reflecting a different paid attendee scenario for the Hybrid Annual Meeting. Leadership and TMAP Meetings are assumed to be in-person events in 2022.
2022 will prove to be a very exciting, yet challenging time, and an important year for INTA as we continue to deal with the uncertainty of COVID-19 and the impact on future events. Both member renewals and meeting attendance may be impacted by COVID-19 and may continue to strain future cash flows. Staff will need to continue to be flexible regarding future event planning.
As Treasurer, it has been an absolute honor to work with the officers, committee members, the general membership, and the Association’s staff, especially the talented Finance Department staff and the Chief Executive Officer, and I am confident in the continuing progress and growth of our Association.
Ms. Bradley made this presentation to the Board of Directors on November 15, 2021.
Although every effort has been made to verify the accuracy of this article, readers are urged to check independently on matters of specific concern or interest.
© 2021 International Trademark Association
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