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Report from the Board:
Audit Report

From: LEAVEN, Vol. 37 No. 6, December 2001-January 2002, pp. 122, 143.
Marcia Lutostanski
LLLI Board of Directors

Each year the La Leche League International Board of Directors commissions an independent audit of the financial operations that are based out of our Schaumburg, Illinois, USA office. In July the audit of La Leche League International for fiscal year April 1, 2000 to March 31, 2001, was completed by Thomas Havey, LLP, Certified Public Accountants. To verify the financial status of the organization, the auditors assess the financial records, procedures, and policies of LLLI.

The audited financial statement for 2000-2001 shows a surplus of revenue and support over expenses. LLLI’s financials would have shown a deficit had it not been for the real estate tax refund. Figure 1 shows a percentage breakdown of revenue from operations and Figure 2 shows total revenue and support (see page 143).

The surplus this year is due to a successful appeal by LLLI of an earlier classification by the State of Illinois that required us to pay property tax on the registered office building and land. In March 2001, we were reclassified as a charitable organization, and therefore exempt from this real estate tax. We will receive a refund of taxes paid from 1996 through 2000. This represents a significant nine percent of revenue. A portion of this refund, $44,493, was received in April 2001, with the remaining balance of $220,762 to be paid over the next three years or so. However, the entire refund is counted as revenue in fiscal year 2000-2001. (After the closing of the accounts in March for this audit, we have learned that LLLI will not be receiving a refund of taxes paid in fiscal year 1996-1997. This will result in a decrease in revenues of almost $77,000 in fiscal years 2001-2002.)

Membership dues and subscriptions started to show improvement for the first time in a few years. Memberships with subscriptions brought in about $4,000 more than the previous year. (In the US, memberships are accompanied by subscriptions to New Beginnings and Leaven.) Membership represents not only an important source of income for La Leche League at all levels, but also reflects a commitment made by mothers, Leaders, Groups, and Alumnae to LLL.

The World Walk is an indication of mission work, as well as a fundraiser for LLLI as well as Groups, Areas, and Divisions. For 2000-2001, income for LLLI from the Walk was up by almost $18,000 and this also meant more income for the participating Groups. Due to careful control of expenses, the surplus of income over expenses for LLLI was $73,703, up from $37,637 for the previous year. We’ll keep working to improve the results for both LLLI and the local Groups in this important fundraising and public relations effort.

Sales of materials including books and pamphlets were almost $74,000 less than the previous year. However, expenses were well controlled which improved the earnings from publications.

General Contributions (excluding those allocated to the Capital Campaign and those which were restricted for the chaordic initiative) have been and are expected to continue to be an increasingly important part of support (see sidebar on page 122) for LLLI operations. We realize that sales of materials and memberships cannot be expected to fully support the many programs we envision as we work to achieve our organization’s mission. Therefore, contributions will continue to be a major source of funding for LLLI programs.

The organization’s financial position continues to be strong. Current assets equal to more than twice the level of current liabilities. The financial results achieved this year are indeed gratifying; they would not have been possible without the increased monetary donations and volunteer support given by our Leaders—leading monthly Group meetings, taking telephone calls, organizing participation in the World Walk, informing mothers about the benefits of LLL membership—as well as the careful management and financial control exercised in the LLLI office and in the field. Continued control of expenses and diversification of income sources are crucial to the future financial stability of LLLI, enabling us to support future generations of mothers and breastfed babies around the world.

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