MAINE HUMANITIES COUNCIL Maine Humanities Council 1 Financial Overview Presented by: Don Gaudet RUNYON KERSTEEN OUELLETTE Recently, Maine Humanities Council completed the financial audit process. We are pleased to report that the Council received an unqualified “clean” opinion. Simply, this means that Maine Humanities Council’s financial statements are fairly presented in all material respects. Congratulations on this accomplishment. The remainder of this publication is dedicated to providing you with the results of the audit. We hope you find this information useful and understandable. Finally, we wish to express our appreciation to Erik, Mary and all the other members of the Council’s staff who were so helpful to us during the audit process. INSIDE 1. Assets 2. Liabilities and Net Assets 3-4. Revenues 5-6. Expenses 7. Ratio Analysis and Closing Remarks SUMMARY OF SIGNIFICANT CHANGES Decrease in cash is due to the timing of cash receipts and disbursements close to year end. While investments appear to have remained flat with the prior year, it is the result of investment losses of just over ($205k) being offset by additional deferred revenue of around $215k. Receivables increased due to the timing of the receipt of grant expense reimbursements. More specifically, the TAH and NEH grants accounted for $21k and $27k of the increase, respectively. Increase in property and equipment is driven by building improvements of nearly $24k offset by depreciation expense of around $12k. FINANCIAL STATEMENT PRESENTATION October 31, 2008 ASSETS KEY PERFORMANCE INDICATORS

MAINE HUMANITIES COUNCIL Maine Humanities Council 2 SUMMARY OF SIGNIFICANT CHANGES The increases in both regrants payable and accounts payable are both due to the timing of the payment of invoices close to year end. Increase in accrued expenses is due to the recording of accrued vacation ($16k) and two additional days worth of payroll ($6k). Large increase in deferred revenue is due to the receipt of a $300,000 bond from the State of Maine to be re-granted to various organizations over the next five years. LIABILITIES NET ASSETS SUMMARY OF SIGNIFICANT CHANGES Permanently restricted net assets represent proceeds from contributions which must be held in perpetuity by the Council. Decrease in temporarily restricted net assets is due to poor investment return and the use of some building maintenance funds for facility improvements. Net investment in PP&E increased due to facility improvements of nearly $24k, offset by $12k annual depreciation expense. Undesignated net assets represents what’s left over after backing out the other classifications.

MAINE HUMANITIES COUNCIL Maine Humanities Council 3 REVENUES SUMMARY OF SIGNIFICANT CHANGES National Endowment for the Humanities (NEH) grants increased due to additional funding for the State Humanities Grant, which accounted for $134k of the $138k increase. Other grants decreased due to lower Department of Education funding for the Teaching American History grant. Contributions and gifts have fallen due to lower overall foundation donations, which accounted for $115k of the $182k drop. Despite that drop, individual and corporate donations have remained steady with the prior year, only decreasing by $7k. Poor market performance was the driver behind the large drop in investment earnings which swung by nearly $418k from 2007 to Slightly smaller numbers of participants in L&M conferences accounts for decrease in program income of around $18k. In-kind revenue increased due to more donated resources in general, particularly in the L&M National program.

MAINE HUMANITIES COUNCIL Maine Humanities Council 4 REVENUES, CONTINUED

MAINE HUMANITIES COUNCIL Maine Humanities Council 5 EXPENSES BY NATURAL CATEGORY SUMMARY OF SIGNIFICANT CHANGES Decrease in personnel costs is due to 2007 having an added accrual for the former Executive Director’s severance package. Decrease in consultant costs is due primarily to the close out of the American History grant which had over $125k of consulting costs in This decrease was offset somewhat by additional consulting costs in the LTAI, Pod Casting, and Winter Weekend programs. Higher in-kind expenses corresponds to the higher in-kind revenues mentioned earlier. Growth in regrants is consistent with greater activity in this area. Decrease in supplies is due to fewer book purchases, particularly in the Born to Read and New Books New Readers programs. All other has increased due to various other factors, including the following: Professional fees($11,800) Printing & publications $8,700 Dues & subscriptions $7,300 Rent & utilities $20,200

MAINE HUMANITIES COUNCIL Maine Humanities Council 6 EXPENSES BY FUNCTION

MAINE HUMANITIES COUNCIL Maine Humanities Council 7 FINAL WORDS This presentation is intended as a tool to assist the Board of Directors and management of Maine Humanities Council in understanding its financial operating results. The information contained in this publication should be read in conjunction with the audited financial statements and related disclosures and should not be used for any other purposes without the expressed consent of RUNYON KERSTEEN OUELLETTE Please contact us at or Long Creek Drive, South Portland, ME FINAL WORDS This presentation is intended as a tool to assist the Board of Directors and management of Maine Humanities Council in understanding its financial operating results. The information contained in this publication should be read in conjunction with the audited financial statements and related disclosures and should not be used for any other purposes without the expressed consent of RUNYON KERSTEEN OUELLETTE Please contact us at or Long Creek Drive, South Portland, ME RATIO ANALYSIS