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financialresults


2015 was another financially challeng- ing year for our association. As you saw in your own personal investment accounts, it was a flat year for the market. Because MOAA relies on income from our invest- ment portfolio to fund operations, our financial position is eroded when the mar- ket doesn’t meet budget projections. Based on that, and the fact that fixed income remains at repressed levels, we’ve taken action to help alleviate demands on our investment portfolio. A bottom-up review of all programs within MOAA, conducted with the board of directors, will help en- sure we are on the right path to maintain long-term financial viability and to provide outstanding support to our members and the military community at large. Our efforts to develop new sources of


Additional Copies Contact MOAA’s Member Service Center at msc@ moaa.org or (800) 234- MOAA (6622) to have a copy of MOAA’s audited financial statements for 2015 mailed to you.


revenue have yielded mixed results. Our goal is to alleviate our reliance on dues and investment returns, but advertising and royalties programs remain challeng- ing. Membership dues, particularly from Life members, are a critical aspect of resourcing our mission but cover only ap- proximately 40 percent of our expenses. Those close to MOAA know of the many great things we collectively accomplish, especially in our advocacy. The more paid members we gain, the better we can sup- port these vital missions and keep the as- sociation on strong financial footing. MOAA has four primary revenue


sources: dues, investments, advertising, and royalties from sponsored products and services. Additionally, we are focused on growing MOAA’s new Military Family Ini- tiative to help support and expand many of the high-impact programs we provide for the greater military community. On the expense side, MOAA spent just


over $22 million on behalf of its members. Our emphasis on cost control has enabled us to reduce expenses in real terms by


74 MILITARY OFFICER JUNE 2016


19 percent since 2008. Expenses can be categorized into four major areas: legisla- tive affairs (MOAA’s original purpose and still its primary mission) is 12 percent of operating expenses; informing members through Military Officer and MOAA’s web- site accounts for 29 percent; supporting councils and chapters is another 9 percent; and the balance helps provide essential benefits and information as well as MOAA- sponsored products and services. In 2015, the MOAA Scholarship Fund


provided $9.2 million of financial assistance in the form of interest-free loans and grants to 1,710 children of military families for un- dergraduate education. This program has helped more than 13,000 military children since its inception in 1948. The Scholarship Fund, not included in the financial state- ments below, exceeded $100 million at the end of 2015. This is all made possible by the generosity of our membership. MOAA’s Statement of Financial Position


reflects that our assets primarily are invest- ments and our liabilities are owed primarily to members. MOAA has collected $64.2 million in both annual and Life membership dues that will be earned as income over the next 60 years. The Widows’ Trust is a $1.3 million obligation to ensure beneficiaries of an expired MEDIPLUS® plan receive the health care insurance they were promised. With net assets of $46 million as of Dec.


31, 2015, MOAA remains in a solid financial position to continue serving America’s mili- tary officers and their families. The strong support of 390,000-plus members allows us to remain financially secure and contin- ue our mission to never stop serving.


— Col. James W. O’Brien, USAF (Ret) Chief Financial Officer


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