1. Report from the Society Committee on Budget & Finance
August 23, 2017
Washington, DC

2. 2017 Probable 1 Projection Highlights
Governning Board for Publishing
1/18/2019
2017 Probable 1 Projection Highlights
Net from Operations – $25.3M
$2.1M favorable to Budget
$1.6M (6.7%) higher than 2016
Total Revenues – $553.0M
$2.4M (-0.4%) unfavorable to Budget
$26.2M (5.0%) higher than 2016
Total Expenses – $527.6M
$4.5M (0.8%) favorable to Budget
$24.7M (4.9%) higher than 2016
To summarize, the 2016 Probable 1 projects a net from operations of $17.3M which is almost $4.0M (actually $3.9M) higher than the Approved Net from Operations ($13.4M); and $723,000 higher than where the Society ended 2015 ($16.6M).
Revenues are projected to be essentially on budget at $528.8M, which is +3.3% higher than If we adjust for foreign currency, top line revenue growth would actually be closer to +4.5% (1.2% or $6.1M adverse effect). FX headwinds adversely impact CAS – more on this later in the meeting from Manny and Jay in the CAS report.
Expenses are projected to be $3.0M favorable to budget which is, coincidently, also +3.3% higher than 2015 actuals.
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Note: Excludes the ACS Petroleum Research Fund and the Member Insurance Program.
Proprietary and Confidential

3. 2017 Probable 1 Projection Net from Operations ($ in Millions)
Information Services
Investments
Net Dues
All Other
Web Strategy & Operations
Scientific Advancement
We’ll now transition to a Division or Programmatic summary of the 2017 Probable 1 Projection.
This slide is a traditional Sources and Uses chart that captures the Society’s major sources of net contribution…purple bars at the top pointing to the right; and net expense – shown here in several colors pointing to the left, showing where those resources are deployed.
What remains at the bottom of the chart and is circled is the projected $25.3M Net from Operations. [CLICK]
Education
Membership
Net From Operations
Note: All Other includes the Development Office and Unallocated Indirect Costs.
Net from Operations excludes the Member Insurance Program and the ACS Petroleum Research Fund. 3

4. 3-year rolling average of free cash flow > 0
Financial Guidelines
Guidelines
Targets
2017
Probable 1
Current Ratio
0.65x target
Debt Ratio
50% maximum
3-year rolling average of free cash flow > 0
Free Cash Flow
The one guideline we are close to finally is the Fund Balance Ratio. This is a measure of the adequacy of Unrestricted Net Assets (defined as UNA/Operating Expenses). We’ve been out of compliance since ACS ended 2016 with UNA of $207 million and a Fund Balance Ratio of 39%; and as you’ll see on a later slide, as of July 31, 2017, UNA has increased since YE 2016.
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2.5% - 5.0%
ROR target
Sustainability
Fund Balance Ratio
50% minimum
American Chemical Society

5. 2018 Program Funding Requests
ACS Online Course on Laboratory Safety
2018 Proposed Budget - $12,000
2019 Forecast Budget - $12,000
2020 Forecast Budget - $12,000
New Faculty Workshop Series
2018 Proposed Budget - $71,000
2019 Forecast Budget - $154,000
2020 Forecast Budget - $164,000
Note: Net expenses are before indirect assessments. 5 5