2022 WAS CHALLENGING
Money Matters
By Keith Sessions, AMA Chief Financial Officer | keithsessions@hotmail.com
The past year was challenging, to say the least. On a positive note, AMA’s dues income came in right on target. Although overall membership was down slightly, we saw an increase in Life Memberships.
Expenses, such as insurance and payroll, were in line with expectations. We did, however, see significant increases in overhead expenses as inflation hit a 30-year high. AMA’s biggest challenge to the balance sheet came from investment income. As it probably was for many of you, our investment portfolio was down in 2022.
A diversified portfolio usually helps to soften the volatility in the markets. 2022 was an anomaly. For the only time since 1976, both the broad market (S&P 500) and aggregate bond market had negative returns for the year. The year 1976 is used only because that is when the aggregate bond index was invented. If a similar bond index is utilized, there is only one other time when both the bond market and stock market generated negative returns in the same year.
This year is starting off a bit better. Both bonds and the market showed a little recovery in January. Inflation is coming down, although it is not at the Federal target of 2%. The expectation right now is that we will see another rate increase in March, and possibly in May, before a pause. Although down markets are never fun, they do pass. This is not the first time we have weathered harsh economies, and we will see many more.
Term Limits and New Blood
This year marks the 10th year that I have served as chief financial officer (CFO) of AMA. I met with Executive Council members at the 2013 Joe Nall event, for what I thought was a simple discussion about the market. That discussion turned into an opportunity to serve an organization that I care about. It has been a wonderful journey and an honor to serve.
That being said, it is time for someone else to take the reins. AMA’s bylaws state that
council members have a three-term limit. There are exceptions to this if no one else runs for the position. The CFO position is appointed and technically not bound by the three-term limit. Still, I feel strongly that organizations benefit from new leaders with fresh ideas.
The previous CFO did a fantastic job. I was able to come in with a different perspective and make changes that helped the organization. I am certain that the next CFO will be able to do the same. Before my job at AMA, I served on a financial oversite committee for the United Way of Cincinnati. I was exposed to a large number of non-profit organizations. The ones with strict term limits and consistent turnover of leadership performed better than the ones that had board members with long tenures.
If you are interested in volunteering for the CFO position, please let us know. A common misconception is that you have to be a certified public accountant (CPA) to hold the position. Although a CPA would be nice, it is not necessary. Business experience and knowledge are just as important. You will need to understand balance sheets and have experience with profit-and-loss duties. You should also have a working knowledge of the economy. It is a volunteer position, but not a full-time job.
I have managed this with a full-time career and a family, and I still have found time to fly and enjoy the hobby. There is no pay—in fact it is encouraged that you donate—but the role is very rewarding. I have great memories of the people I have met and interacted with throughout the years.
