WEBVTT 00:00:05.110 --> 00:00:06.973 position:50% align:middle Good afternoon, everyone. 00:00:08.650 --> 00:00:11.780 position:50% align:middle Hello, my friends, colleagues and fellow regulators. 00:00:11.780 --> 00:00:15.000 position:50% align:middle Thank you for attending this 45th Delegate Assembly. 00:00:15.000 --> 00:00:19.680 position:50% align:middle My name is Adrian Guerrero and I am honored to serve as your NCSBN Treasurer. 00:00:19.680 --> 00:00:23.450 position:50% align:middle Thank you for permitting me a few short minutes to update you on the financial progress we've made 00:00:23.450 --> 00:00:25.060 position:50% align:middle over the past year. 00:00:25.060 --> 00:00:30.294 position:50% align:middle And I'll ask that you please turn to the Report of the Finance Committee in the NCSBN Business Book, 00:00:30.294 --> 00:00:34.134 position:50% align:middle where you will find the FY23 highlights and the accomplishments of the committee, 00:00:34.134 --> 00:00:38.247 position:50% align:middle the independent auditor reports and the financial statements. 00:00:39.834 --> 00:00:43.524 position:50% align:middle Overseeing the finances of a large organization like ours is not a one-person show, 00:00:43.524 --> 00:00:48.024 position:50% align:middle so I'd like to take this time to recognize your dedicated and hard-working NCSBN finance committee 00:00:48.024 --> 00:00:51.014 position:50% align:middle members for the tremendous of amount of work they've done this year. 00:00:51.014 --> 00:00:55.054 position:50% align:middle And I'll ask if you're in attendance, please stand when I call your name. 00:00:55.054 --> 00:01:04.606 position:50% align:middle Chris Archuleta from Washington, Peggy Benson from Alabama, Isonel Brown from Louisiana, 00:01:04.606 --> 00:01:09.539 position:50% align:middle Sue Painter from West Virginia, Tessa Walker Linderman from Alaska 00:01:09.539 --> 00:01:13.306 position:50% align:middle and Diana Waterman from Manitoba. 00:01:13.306 --> 00:01:17.706 position:50% align:middle Please join me in recognizing all the NCSBN finance committee members for their commitment and dedication 00:01:17.706 --> 00:01:19.279 position:50% align:middle to the mission of NCSBN. 00:01:25.916 --> 00:01:30.680 position:50% align:middle Our Committee Charge and Charter are to maintain a strong financial position that allows the organization 00:01:30.680 --> 00:01:37.190 position:50% align:middle to enhance quality, introduce new program elements and grow without compromising or jeopardizing core program 00:01:37.190 --> 00:01:40.330 position:50% align:middle delivery to nursing regulatory bodies. 00:01:40.330 --> 00:01:43.980 position:50% align:middle And as part of our Charge, we advise the board on the overall direction and 00:01:43.980 --> 00:01:48.240 position:50% align:middle control of the finances of the organization and the committee reviews and recommends the budget to the 00:01:48.240 --> 00:01:50.230 position:50% align:middle board every year. 00:01:50.230 --> 00:01:52.970 position:50% align:middle At our August meeting, we reviewed the budget and it'll be presented to the 00:01:52.970 --> 00:01:55.990 position:50% align:middle board of directors at their September meeting. 00:01:55.990 --> 00:02:01.268 position:50% align:middle The committee monitors income and expenditures against program activities, against projections and presents 00:02:01.268 --> 00:02:04.298 position:50% align:middle the quarterly financial statements to the board. 00:02:04.298 --> 00:02:09.098 position:50% align:middle The committee oversees the financial reporting processes, the systems of internal accounting and the 00:02:09.098 --> 00:02:12.478 position:50% align:middle financial controls the performance of the auditors. 00:02:12.478 --> 00:02:16.338 position:50% align:middle And the committee recommends to the board the appointment of firms to serve as independent auditors 00:02:16.338 --> 00:02:20.038 position:50% align:middle and the finances of the organization are audited every year. 00:02:20.038 --> 00:02:25.008 position:50% align:middle And lastly, the committee makes recommendations to the board with respect to the investment policy and assures 00:02:25.008 --> 00:02:28.221 position:50% align:middle the organization maintains adequate insurance coverage. 00:02:30.198 --> 00:02:35.068 position:50% align:middle And the desired impact of the committee's work is to provide the adequate financial resources to fund the 00:02:35.068 --> 00:02:41.308 position:50% align:middle tactical plans necessary to execute NCSBN's strategic initiatives over the long term and that support the 00:02:41.308 --> 00:02:44.538 position:50% align:middle public protection mission of the organization 00:02:44.538 --> 00:02:48.668 position:50% align:middle to establish a benchmark for operating reserves to help ensure financial stability. 00:02:48.668 --> 00:02:54.848 position:50% align:middle And by policy we're required to keep at least 25% of the annual operating budget in the operating reserves. 00:02:54.848 --> 00:02:59.238 position:50% align:middle And we have established a capital reserve amount that provides the flexibility of the organization 00:02:59.238 --> 00:03:04.101 position:50% align:middle to enhance quality, introduce new program elements to nursing regulatory bodies. 00:03:04.101 --> 00:03:06.055 position:50% align:middle And that totals 25 million. 00:03:06.055 --> 00:03:10.651 position:50% align:middle And we like to keep both the operating and capital reserves at high levels. 00:03:10.651 --> 00:03:15.351 position:50% align:middle And lastly, we've established a long-term board-designated fund to supplement program revenue, 00:03:15.351 --> 00:03:20.648 position:50% align:middle and despite the steep decline in the financial markets and losses in the investment value in FY-22, 00:03:20.648 --> 00:03:25.354 position:50% align:middle the NCSBN investment portfolio has returned $151 million 00:03:25.354 --> 00:03:28.749 position:50% align:middle over the last 10-year period through FY-22. 00:03:31.700 --> 00:03:39.409 position:50% align:middle A total of 69% of the revenue comes from NCLEX in the U.S., and we receive 6% from NCLEX in Canada and 7% 00:03:39.409 --> 00:03:41.900 position:50% align:middle from nurses for license verification fees. 00:03:42.435 --> 00:03:48.100 position:50% align:middle And a total of 11% of the revenue budget for FY-23 comes for the accumulated earnings on investments, 00:03:48.100 --> 00:03:53.210 position:50% align:middle and NCSBN budgets an amount equal to the long-run average annual expected return on the investment 00:03:53.210 --> 00:03:57.060 position:50% align:middle portfolio to supplement our operating revenues. 00:03:57.060 --> 00:04:01.637 position:50% align:middle And this will vary from the actual returns in any given year because the actual investment and returns are 00:04:01.637 --> 00:04:04.287 position:50% align:middle dependent upon the changing conditions of the financial markets. 00:04:04.287 --> 00:04:08.597 position:50% align:middle And as we all know, those can vary significantly from year to year. 00:04:08.597 --> 00:04:13.797 position:50% align:middle And all other sources of operating revenue combined total less than 1% of NCSBN's income budget. 00:04:13.797 --> 00:04:17.747 position:50% align:middle And the other income includes meeting registration fees, associate member fees, 00:04:17.747 --> 00:04:21.997 position:50% align:middle CE course revenue and publication sales revenue. 00:04:21.997 --> 00:04:27.217 position:50% align:middle And in addition to the program revenues and investment earnings, 7% of FY-23 support had planned to come 00:04:27.217 --> 00:04:28.747 position:50% align:middle from the financial reserves. 00:04:28.747 --> 00:04:32.231 position:50% align:middle And so, that's a broad overview of our revenue sources. 00:04:33.438 --> 00:04:36.478 position:50% align:middle And how we use those funds is depicted in this graph. 00:04:36.478 --> 00:04:42.698 position:50% align:middle NCLEX is also our largest expenditure at 65 cents of every dollar goes spent directly to support exams. 00:04:42.698 --> 00:04:47.478 position:50% align:middle And the exams department also receives substantial support from the other 35 cents for occupancy, 00:04:47.478 --> 00:04:51.228 position:50% align:middle administrative services, information technology, communications. 00:04:51.228 --> 00:04:53.738 position:50% align:middle They all provide support to exams. 00:04:53.738 --> 00:04:59.028 position:50% align:middle And the combined expenditures on program activities to assist the boards, including committees, meetings, 00:04:59.028 --> 00:05:07.150 position:50% align:middle research, NLC support and online offerings for members comprises 16% of the total budget. 00:05:07.150 --> 00:05:14.122 position:50% align:middle Nurses, which includes ORBS and eNotify, is 3% of the budget, and IT infrastructure equals 8%. 00:05:14.122 --> 00:05:18.910 position:50% align:middle And the combined total expenditures on supporting services, which include governance, 00:05:18.910 --> 00:05:25.705 position:50% align:middle and that's the board and executive management, marketing, advocacy, finance and HR, equals 6%. 00:05:25.705 --> 00:05:30.508 position:50% align:middle And occupancy, which is primarily our office space equals 2%. 00:05:30.508 --> 00:05:34.274 position:50% align:middle And so, that's a broad overview of how we use our funds at NCSBN. 00:05:36.288 --> 00:05:39.518 position:50% align:middle Now on this slide, we're going to talk about the fund balance. 00:05:39.518 --> 00:05:44.908 position:50% align:middle In looking at the projected value of the fund balance from the end of FY-24 through FY-27, 00:05:44.908 --> 00:05:49.098 position:50% align:middle you'll see that the fund balance in this chart is about 250 million. 00:05:49.098 --> 00:05:53.808 position:50% align:middle Seven percent of FY-23 revenue will come from withdrawals from the financial reserves as it was shown 00:05:53.808 --> 00:05:55.784 position:50% align:middle in the source of funds slide. 00:05:55.784 --> 00:06:01.977 position:50% align:middle And we project that we will need to continue to use some of those reserved funds to support operations, 00:06:01.977 --> 00:06:03.927 position:50% align:middle resulting in a decline in the reserve balance. 00:06:03.927 --> 00:06:06.757 position:50% align:middle And you will see a slight decline in this graph. 00:06:06.757 --> 00:06:10.117 position:50% align:middle However, that's not cause for immediate concern. 00:06:10.117 --> 00:06:14.557 position:50% align:middle We will still have a very healthy investment balance, even with having to use some of our operating fund 00:06:14.557 --> 00:06:17.267 position:50% align:middle balance to provide support for our projects. 00:06:17.267 --> 00:06:22.497 position:50% align:middle And while this will not jeopardize NCSBN's financial stability in the short term, 00:06:22.497 --> 00:06:27.617 position:50% align:middle the committee continues to focus on strategies to balance the budget over the longer term. 00:06:27.617 --> 00:06:32.071 position:50% align:middle And the committee recommended to the board to consider increasing annual operating revenues to a level that 00:06:32.071 --> 00:06:34.861 position:50% align:middle could sustain operations for the long term. 00:06:34.861 --> 00:06:39.491 position:50% align:middle However, the board determined that the current financial position allowed for just a little bit longer 00:06:39.491 --> 00:06:45.451 position:50% align:middle timeline to address the forecast of decline in the fund balance and would not propose an increase at this time. 00:06:45.451 --> 00:06:49.131 position:50% align:middle But they will continue to closely monitor the financial performance and they will update the 00:06:49.131 --> 00:06:51.337 position:50% align:middle forecast as required. 00:06:53.051 --> 00:06:57.481 position:50% align:middle So in summary, some of the performance outcome measures that the finance committee looks for is a strong 00:06:57.481 --> 00:07:02.825 position:50% align:middle financial position that provides an internal source of funds that allows the financial flexibility so that we 00:07:02.825 --> 00:07:08.495 position:50% align:middle can expand our services to the members and to provide a financial stability by planning operating budgets that 00:07:08.495 --> 00:07:13.465 position:50% align:middle we can support over the long term and that link financial resource allocation to the public protection 00:07:13.465 --> 00:07:15.235 position:50% align:middle mission of the organization. 00:07:15.235 --> 00:07:20.255 position:50% align:middle And to have an investment policy and strategy in place that produces the optimum returns on the financial 00:07:20.255 --> 00:07:25.635 position:50% align:middle investments within the risk tolerance of NCSBN, and investments and asset allocations that are guided 00:07:25.635 --> 00:07:28.895 position:50% align:middle by sound policies and that manage risk. 00:07:28.895 --> 00:07:32.740 position:50% align:middle And likewise, we received an attestation from outside independent auditors on the financial 00:07:32.740 --> 00:07:38.590 position:50% align:middle statement accuracy and the good internal controls and policies and procedures are in place. 00:07:38.999 --> 00:07:41.944 position:50% align:middle And with that, that completes your finance report for this year. 00:07:41.944 --> 00:07:46.350 position:50% align:middle Thank you for finding us time to update you on the financial standing of NCSBN. 00:07:46.350 --> 00:07:49.710 position:50% align:middle But before I go, and before I close, given this is my last time in front of you 00:07:49.710 --> 00:07:54.180 position:50% align:middle as treasurer, I have a few people I'd like to recognize. 00:07:54.180 --> 00:07:59.170 position:50% align:middle First, I'd like to extend my heartfelt appreciation to the CFO, Mr. Rob Clayborne, 00:07:59.170 --> 00:08:02.229 position:50% align:middle and our Director of Finance, Ms. Gloria Evans-Melton, 00:08:02.229 --> 00:08:05.036 position:50% align:middle for their support during my tenure as treasurer. 00:08:05.036 --> 00:08:08.906 position:50% align:middle Their expertise, dedication and hard work were instrumental in maintaining the financial health 00:08:08.906 --> 00:08:10.436 position:50% align:middle of our organization. 00:08:11.100 --> 00:08:16.096 position:50% align:middle And I thank all of the amazing staff at NCSBN for their commitment to our important mission. 00:08:16.096 --> 00:08:22.736 position:50% align:middle And I'd be remiss if I didn't include my wife of 27 years, who, you know, after 8 years, 00:08:22.736 --> 00:08:25.486 position:50% align:middle I had some travels here and there and some things I kind of missed. 00:08:25.486 --> 00:08:31.327 position:50% align:middle So she understood what I was doing and she supported my mission and our boys are doing wonderful. 00:08:31.327 --> 00:08:35.867 position:50% align:middle They're out on their own, so we're empty nesters now. 00:08:35.867 --> 00:08:38.447 position:50% align:middle So she's not here, but somebody text her. 00:08:38.447 --> 00:08:40.487 position:50% align:middle So thank you, Honey. 00:08:42.761 --> 00:08:47.657 position:50% align:middle And then, I'd also like to recognize our Kansas Executive Officer, Carol Moreland, 00:08:47.657 --> 00:08:53.637 position:50% align:middle the Kansas board members and my KSBN staff for their support and encouragement covering when I was 00:08:53.637 --> 00:08:55.097 position:50% align:middle gone as well. 00:08:55.097 --> 00:09:01.369 position:50% align:middle They, you know, allowed me to fulfill this important mission for NCSBN and I thank them for being 00:09:01.369 --> 00:09:03.109 position:50% align:middle an exceptional team. 00:09:03.109 --> 00:09:07.136 position:50% align:middle And then, to all my colleagues on the Board of Directors, I want to thank you for the cherished 00:09:07.136 --> 00:09:11.509 position:50% align:middle memories and for making my eight-year journey a truly rewarding one. 00:09:11.509 --> 00:09:16.052 position:50% align:middle I had the honor of serving with 5 amazing board presidents and I think if I got my counting right, 00:09:16.052 --> 00:09:20.811 position:50% align:middle 28 members on the board, each of whom work tirelessly to advance the 00:09:20.811 --> 00:09:22.342 position:50% align:middle mission of NCSBN. 00:09:22.342 --> 00:09:26.869 position:50% align:middle And I feel very fortunate to have been a part of that talented group of individuals. 00:09:26.869 --> 00:09:30.869 position:50% align:middle And most importantly, I want to thank you, the membership. 00:09:30.869 --> 00:09:34.709 position:50% align:middle I am deeply grateful and honored to have served in this position. 00:09:34.709 --> 00:09:40.839 position:50% align:middle You heard I'm kind of the picture guy, so I've got a lot of memories to remember from my time. 00:09:40.839 --> 00:09:44.139 position:50% align:middle But I want to thank you each for what you do for nursing regulation. 00:09:44.139 --> 00:09:46.829 position:50% align:middle This is incredibly important work. 00:09:46.829 --> 00:09:48.259 position:50% align:middle It's not easy. 00:09:48.259 --> 00:09:53.309 position:50% align:middle And we thank you so much on the Board of Directors, and myself personally as well, 00:09:53.309 --> 00:09:56.499 position:50% align:middle for what you do for public protection. 00:09:56.499 --> 00:10:02.208 position:50% align:middle And with that, I wish the next treasurer, NCSBN treasurer the board and the committee members, 00:10:02.208 --> 00:10:06.518 position:50% align:middle I'm confident that they will continue to work today, tomorrow and most importantly together, 00:10:06.518 --> 00:10:11.535 position:50% align:middle to continue to lead and prepare our organization towards its strategically sound financial future. 00:10:11.535 --> 00:10:12.554 position:50% align:middle Thank you.