2010 Finance Survey: Highlights from a first-time report by Association TRENDS
Sponsored by West, Lane and Schlager and conducted by Association Research Inc.
For the first time, Association TRENDS has sought to gauge the mood and expectations of nonprofit finance executives as it relates to the pulse of the industry and provide benchmarking information for executives across the country. More than 5,500 executives of associations, professional societies and association management companies were invited to participate. The breakdown of respondents was 52.7% trade association executives, 44.6%professional societies executives, and 2.7% who represent association management companies.
The Association TRENDS finance survey found that claims of the recession’s end may be valid, at least for the association world.
Revenue expectations. Associations estimate nondues revenue, including donations, will rise or stay flat over the next six months. As revenue sources for associations are a lagging indicator, this is good news for the state of the economy, as well as associations.
Investment attitudes. Nearly half (45%) of association finance executives say their cash reserves increased in the past six months, and 34% say reserves remained the same. This, in conjunction with a nearly across the board policy to pay bills within 30 days of receipt, suggests a shortened debt cycle, further evidence that the recession for associations is over or near its end.
Salary projections. Less than 2% of associations now project a decrease in staff salaries in the next six months, and nearly 60% actually reported plans to increase salaries. The larger the organization’s budget, the more likely salary increases are.
Reliance on dues. Dues account for less than 50% of association revenues.
Impact of healthcare legislation. The implementation of the Patient Protection and Affordable Care Act will not for now have much effect on associations, according to the survey’s findings. Less than one in five organizations project having to change their offered benefits plans to comply with recent healthcare legislation.
Role of CEOs. The survey found that in a large number of organizations, CEOs are the key decision-makers in financial as well as administrative matters, even in several cases where a CFO is present.
Purchasing practices. The use of RFPs varies greatly with both size of organization and outsourced service. Generally, those associations with mid-range budgets issued the most RFPs.
Satisfaction with vendors. Satisfaction with vendors varied consistently with type of services – with the highest level of satisfaction with their legal vendors. Banking and communications marketing vendors drew the least number of greater-than-neutral responses.
More highlights
• Nearly half (45%) of association finance executives say their associations’ cash reserves increased in the past six months, and 34% say reserves stayed the same.
• 8% of responding associations use requests for proposal for banking services. Of those, 31% send RFPs to banks one to two times a year.
• After all the hoopla, nearly half (48%) of association finance executives say the process to complete the new Form 990 is no more or less difficult than filling out the old form; but 43% say it is more difficult.
• Good news for vendors: 92% of associations report their policy is to pay bills within 30 days. None report their policy is to pay within 90 days.
• Also see charts for results on nondues revenue and vendor satisfactiion.
The TRENDS Finance Survey was conducted for the first time late last year by Association Research Inc., Rockville MD, and sponsored by West Lane & Schlager, Washington, and the Reznick Group, Bethesda MD.
To obtain a copy of the final TRENDS Finance Survey, contact Autumn Jones at AJones@ColumbiaBooks.com.
