Division IV Director Report

Why is IEEE different from other technical societies?

The breadth of activities!

Membership

350,000 members

210,000 also belong to societies

That means that 140,000 members belong to to IEEE for reasons other

than society participation!

IEEE• Technical Activities

– Societies

• Regional Activities– Chapters– Sections (Some)

• Educational Activities• IEEE- USA• Standards• HQ - The folks who run it

(Green = income other than IEEE dues)

IEEE Funding Source History

Annually From IEEE Budget

Member DuesInv. IncomeConferencesNon-member PubsPackaged Products

IEEE duesAll Income Sources

Society DuesConference IncomeNon-member Pubs

IEEE duesInvestment IncomePackaged Products

IEEE Reserves - History

($20)$0

$20$40$60$80

$100$120$140

YE1994

YE1995

YE1996

YE1997

YE1998

YE1999

YE2000*

YE2001

YE2002

* 2000 was first year Corporate Reserves were depleted

Final IEEE Ending Reserve Balances ($M's)

Restricted Fund

Societies/Councils & TAB

ISTO

IEEE-USA and AAES/ABET

Educational Activities

Regional Acts & Offices

Standards Association

Corporate

Where IEEE money comes from

~$250M revenues per year$25-35M from IEEE dues$3M from StandardsThe rest are split between conference income

and pubs salesPlus a smattering of other sources (society

dues, regional confs, Proc of the IEEE, regional events, etc

IEEE Finances ($M)Entity Revenue ExpenseSpectrum 13 (Dues) 13EAB 3 (Dues) 3RAB 8 (Dues) 8Geog. Units 1 (Dues) 1

IEEE Other 23 (Dues) 24Publications 4 (Dues) 4 (Pubs distributes IEL income to S/Cs =

21)Standards 11 11

TAB/Soc. 154 153IEEE-USA 6 6

Infrastructure

Current infrastructure costs are like 20-30% of NPS expenses

IEEE Conferences

• Included Services– Use of Logo– IEEE Advertising– Budget Review/Approval/Audit Services– Forward Funding (Advance Loan)– Fiscal Insurance– IEEE Publication of Conf Record, Journal, Transactions– Publication Sales by IEEE (ASPP, IEL, …)

IEEE Conferences•Available Services

•Audit•Contract Negotiation•Conf Planning•Registration•Travel

Current Issues

• Should governance structure change?

• Should publications income be dependent on usage?

• Should TAB expand w/o bounds or should there be a S/C life cycle?

• There will be Division Director-Elect positions in all Divisions

Current Issues (con’t)

• Reserve funds are ~ $77M. "Non-Reserve" funds are $47M (invested in minimum risk vehicles)

• Reserves “should” be built to 50% of annual expenses (10 year process?)

• Affiliate fees to 50% of IEEE dues• No business class travel for 2003 and

2004 (except health reasons or IEEE President(s))

History

Prior to mid-1960’s: All income goes to the General Fund:All entities funded annually by IEEE

Brief IEEE Financial History

• 1967 - Investment fund initiated• 1969 - Investment committee established• 1970 - Societies requested financial assistance• 1971 - Society surplus concept established• 1973 - Additional Society revenue streams requested;

Board gave credit for “short term” interest on surplus balance

• 1974 - Societies allowed to keep non-member single-sales revenue

• 1974 - Long-term investment pool created allowing Societies to share in investment gains

Brief IEEE Financial History (Cont.)

• 198? - Additional society revenue requested• 198? - ASPP revenue distributed to Societies• 198? - Book broker revenue to TAB• 1993 - RAB reserve fund established• 1994 - EAB reserve fund established• 1996 - Practice of raising dues to only add money to

reserves ended• 1996 - Standards reserve fund established• 1996 - Book broker revenue to Societies• 1996 - Current financial model identified by volunteers

& staff as a major issue

Brief IEEE Financial History (Cont.)

• 1996 - Practice of spending from prior years surplus began at 9% of investments level

• 1996 - Allocation study undertaken• 1996 - Allocations frozen expecting “infrastructure

charge” to begin shortly (did not happen) • 1998 - “New” financial model proposed• 1999 - Proposal withdrawn• 2000 - Russell committee established• 2000 - Corporate reserves went to 0, investment market

declined, resulting in OU reserves being taxed

Brief IEEE Financial History (Cont.)

• 2001 - Findlay committee established; Allocation process implemented in 2002 budget; TAB allocation process implemented

• 2002 - Adler committee established (LRBPC); Process for overhead recovery evolved; TAB committee refined allocation model for Societies/Councils

• 2002 - Financial model implemented• 2002 – IEEE BoD mandates balanced

operations budgets

2001 Budget

• Long practice of building 9% return on investments into budget continued

• Additional $10 Million of Initiatives• Overall 2001 actuals

– ($29.3 Million)– Mainly due to stock market decline

• 2001 operations actuals– Positive to budget by over $11.0 Million– Expenses still greater than income– IEEE began responding to slowing economy

2002 Budget• Practice of investment spending paying

for operations eliminated• IEEE BoD mandated net zero or positive

operations budget• 2002 IEEE operations net improved by

over $23 Million relative to 2001 budget• BoD passed a net positive operations

budget• Continued reacting well to slowing

economy

2003 Budget

• Practice of not using investment spending to pay for operations continued

• IEEE 2003 operations budget– $0.8 million net operations surplus

• Continuing to react well to the economy