Treasurer’s Report 2020
Published: December 2, 2020
Dana Northcott Amazon.com, Inc. Seattle, Washington, United States Treasurer, INTA Board of Directors
As I end my term as Treasurer, I am pleased to report that although 2020 has been a very challenging year, our Association continues to be in sound financial standing. The 2020 budget, adopted by the Board of Directors last November, which projected a net loss (total revenue minus total expenses) of $2.2 million unfortunately was not achieved as a result of the cancellation of the Singapore Annual Meeting. INTA staff worked diligently and has been successful with the transition to this Virtual Annual and Leadership Meeting, which will have a positive financial contribution to the Association and help offset the adverse financial impact of the cancelled Singapore meeting.
The cancellation of the in-person Singapore Annual Meeting, which was budgeted to generate $7.8 million of Net Revenue, has created significant liquidity constraints for the Association. As a result, cash management has been a top priority for the Finance Committee in 2020. Following the decision to cancel the Singapore Annual Meeting we reached out to our banking partners at JP Morgan and secured a $5 million line of credit which has been utilized to fund ongoing Association operating expenses. Additionally, $4.5 million has been liquidated from our Reserve Fund during the first nine months of the year also to pay for ongoing operating expenses. Our Reserve Fund which at the beginning of 2020 had a balance of $25.8 million now has a balance of $21.6 million. The access to liquidity generated by the sale of investments from the Reserve Fund is exactly the reason why the Reserve Fund was created several years ago.
We maintained an overall 86 percent membership retention rate in 2020, added 594 new members and continue to have close to 7,000 members around the world. Our 2020 Membership Dues of $6 million was our primary source of revenue due to the cancellation of the Singapore Annual Meeting. When we prepared the 2020 budget, we assumed that attendance in Singapore would be approximately 10,900 and would generate over 50% of total revenue. This combined Virtual Annual and Leadership meeting which will have over 3,000 registrants will generate approximately $1 million of Net Revenue.
2020 marks the third year of the 2018–2021 Strategic Plan. The management team continues with the implementation of that strategic plan including promoting the value of trademarks and brands, reinforcing consumer trust and embracing innovation and change.
Conferences and Meetings were significantly impacted by Covid-19 as both the Latin America conference and TMAP meeting were cancelled. We were successful with our first virtual conference as the March New York conference was a virtual event and generated over $150 thousand of revenue and $112 thousand of net revenue. The Europe conference in Madrid which occurred in February and prior to the regional lock downs and travel bans generated revenue of $205 thousand and $125 thousand of net revenue. 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 staff has now 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 2020. Total expense for the Association forecasted to be $18.3 million will be lower than the original budget by $6.6 million.
The new INTA website was launched in June of 2020 with a new look. The website is more user friendly and easier to navigate. The site features enhanced search capabilities, greater member access to their personal INTA-related information, and new content sections.
The Association collected over $22 thousand of donations from members which was donated to several regional organizations for Covid-19 related Personal Protective Equipment purchases.
As of September 30, the Reserve Fund balance was $21.2 million, $4.6 million lower than at the beginning of the year. During 2020, the Finance Committee has been diligently monitoring and reviewing performance with our investment advisors at JPMorgan. 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 2021 budget will be presented to the Board of Directors today and will reflect Membership retention of 86% which is slightly better than 2020 and consistent with prior year trends. Four budget scenarios will be presented to the Board each reflecting a different format and/or timing for the Annual and Leadership Meetings. The budget will include virtual offerings for regional conferences in New York, Europe and Africa.
We continue to invest in the Association regarding legal resources, and public policy and advocacy. INTA’s representative offices’ staff total 12 with estimated expense of approximately $2.3 million. Staff in Europe, Latin America, China and Asia Pacific continue their advocacy, membership development, and communications. Our Washington, D.C., office will continue to enhance our presence and effectiveness in Washington, with the support of staff supplemented by expert lobbying and consulting support. We continue to be well served by our consultant in Delhi. Underlying all these activities is the dedication to grow our membership base globally, and consistently enhance our member benefits.
2021 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 honor to work with the officers, committee members, the general membership, the staff especially the staff and the Chief Executive Officer, and I am confident in the continuing progress and growth of our Association.
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.
© 2020 International Trademark Association
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