Executive VP’s Report - 2004/02

170
ON NOVEMBER 1, 2003, the Executive
Council approved the budget for the year
2004. The total amount of income is
projected to be $10,069,690 and the
expenses are estimated at $9,909,712. This
will result in an excess of income over
expenditures of $160,878. The capital
budget that was approved totals $269,015
and this is always subject to funding.
If we are able to operate at a spending
level below that projected in our budget,
those funds are then availablc for capital
expenditures. We are generally able to do
that because needs and prices change. This
has created a surplus in the past in addition
to some noncash expenditures that are
budgeted items.
It is anticipated that buildings will
require improvements and renovations
totaling $110,000, land improvements
$17,065, equipment $67,550, and
computers/software $74,400.
Indications are there will be an excess
of income over expenses for the year 2003.
These funds will also be available for
capital expenditures in 2004.
Continuing with reports from the
financial statements for the year ended
December 31, 2002, the notes to the
financial statements presented below relate
to the following items:
NOTE J - LONG-TERM LABILITIES
NOTE K - LINES OF CREDIT
NOTE L - OPERATING LEASES
Closing Thought: You may be the only
gospel that some people will read.
Remember, Always Be Courteous. Until
later ...
Executive VP’s Report
Doug Holland
AMA Executive VP
3517 Fernwood Dr.
Raleigh NC 27612
(Home) (919) 787-5163
(Office) (919) 787-7454
THE ACADEMY OF MODEL AERONAUTICS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE J - LONG-TERM LIABILITIES
The Variable Rate Educational Facilities Revenue Bond agreement contains covenants
regarding certain financial statement amounts, ratios and activities of the Academy. At
December 31, 2002 and 2001, the Academy was in compliance or had received the necessary
waivers for all such covenants.
Interest expense on long-term liabilities was $66,686 and $110,114 for the years ended
December 31, 2002 and 2001, respectively.
Current maturities of long-term liabilities for the subsequent five years are as follows:
2003 $ 200,000
2004 200,000
2005 200,000
2006 200,000
2007 200,000
NOTE K - LINES OF CREDIT
The Academy had $1,000,000 available on a line of credit with a bank at December 31, 2001
which expired on June 30, 2002 and was not renewed. The line of credit required monthly
interest payments on any outstanding borrowings at .25% above the national prime rate (4.75%
at December 31, 2001). There were no outstanding borrowings on the line of credit at
December 31, 2001.
NOTE L - OPERATING LEASES
The Academy has entered into various operating lease agreements for copier equipment. The
leases require monthly lease payments of $4,244 plus additional charges based upon usage.
The equipment may be purchased for fair market value at the end of the lease. The leases
expire at various dates through April 2007. The amount charged to lease expense was $83,622
and $56,901 for the years ended December 31, 2002 and 2001, respectively.
Future minimum lease payments for the subsequent five years are as follows:
2003 $ 81,264
2004 67,350
2005 58,206
2006 56,580
2007 18,860
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