[Ofa_boardplus] Belated Treasurer's report

Jim Ryan jimdryan at gmail.com
Mon Feb 19 10:48:56 PST 2018

The financial reports were late coming to me and I couldn't get to this
summary until now. I'm going to send the same report each month, in terms
of explanation, with the actual numbers changing, of course.

We basically have two kinds of reports, those that are based on "accrual"
accounting and those based on actual cash flow. Accrual accounting is used
by the Linux Foundation because that is what is required by "Generally
Accepted Accounting Principles" (GAAP) for our kind of organization.

What this means, and the obvious basis for why you might consider it to be
a "useful fiction" is membership dues for the year are treated as income
for each month but dividing the total by 12. This obviously has no
connection with reality.

According to this treatment, we had net income of $2,058.54, resulting in
an increase in equity to $325,330.40 on the balance sheet. The report also
shows $409,680.80 in cash.

Our newly-developed budget format shows a carry forward surplus of $323,272
increasing by our net income amount to $325,330. Recall this has to be put
in the context of the "operating reserve" we agreed to earlier of $140,000
and a Workshop reserve of $20,000.

The LF also produces a "Cash Flow Statement" which adjusts the net income
reported earlier to produce a number that drives changes in our cash
position each month. The adjustment takes into account changes in assets
and liabilities which, depending upon direction, increase or decrease, is a
source or use of cash. This report shows an increase in our cash position
by $3,091.93 to $409,680.80.

The LF is also busy processing membership dues and fees for participation
in the interop/logo program. All members have been invoiced and new members
are being processed. membership dues that have not been paid are being
escalated and I'm copied.

As you'll recall we had a significant increase in interop/logo program
participation fees. As of the end of January NONE of the participants has
paid. However, we are going to allow upcoming testing to proceed as planned

Comments/question/requests are more than welcome, whether to the group or
to me individually. Also, I'll send the actual reports to anyone who wants
to see them

thanks, Jim, acting Treasurer
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