One of the things that the Management Team has been considering for a while is whether to continue on with the membership fees set as they are (Basic $12 and Expanded $18). The following two links provide access to two Five Year Financial Projection models. The first Five Year Projection model assumes that we continue with the membership fees as they are. The second Five Year Projection model assumes that in 2023 thru 2025 we halve the membership fees (Basic $6 and Expanded $9). In these models you will also see the membership counts and anticipated counts over the next three years.
See corrected Five Year Financial Projection models in post below.
Operating Expense Break Down for 2021 as submitted to the IRS
Please read the notes carefully at the bottom of each model so that you understand the assumptions made in producing the Five Year Projection.
Anticipating your Questions on Taxes:
Stamporama Inc. is a C Corp corporation not a 501(c3) non-profit organization. We have looked into what it would take for us to become a Non-Profit 501(c3) organization with the US Federal Government so that we would not have to pay taxes. For an organization of our size it will just cost too much. The process to achieve the Non-Profit 501(c3) status so that we would not have to pay tax is not something that we could undertake by ourselves. It would require us to engage a attorney (lawyer) which would cost at least $10,000. That was the experience of the Northern Philatelic Library that I'm involved with here in Minneapolis. Given that and David's experience working for a Non-Profit, the cost savings vs the cost to obtain the 501(c3) status plus the extra work to obtain it and maintain it on-going, means that the benefit is just not there. So, we have no option but to continue to pay taxes.
Membership Fee Reduction???
When looking at the second Five Year Financial Projection where we would halve the membership fees for years 2023 thru 2025 it is quite clear that a substantial reduction in membership fees is not financially viable in the long term and I can't see any point in just making a small reduction in the membership fees. Therefore the only responsible solution to ensure that Stamporama can continue for the long term is to continue with the membership fees as they currently stand.
Questions:
We know you will have many questions to this shared financial information, which we are very happy to answer. We hope this will give you as the members of Stamporama some insight into the way your membership fees are spent.
One final comment on the above financial projections, with the current rising costs for energy and inflation we anticipate higher costs for maintaining the website, meaning that we need to have some meat on the bones, to cover the unexpected. Yes, there's a decent amount of cash if all goes according to projections; and that's a good thing. We started this with the idea that we'd ride this for 2 or 3 years before re-evaluating our fees. So far, it looks good.
We looked at lowering rates, and rejected the notion, at least for now. We don't want to be in the position where we are begging for funds to keep afloat. Nor do we want to be so close to the bone that a fried circuit board shuts us down financially.
Some have asked for a monthly/quarterly financial report to the membership. I'm not going to post this information publicly on a monthly/quarterly basis because it would be very confusing for many people. 90% of the income comes in during May and June and the expenses are spread fairly evenly over the 12 months of the financial year. So depending on the month that you look at the finances, it will look as if we have a huge amount of money or it will look like we have just enough. I commit to providing the Profit and Loss Statement for the recent financial year to the membership in January each year, as a part of the tax return process.
Regards ... Tim.
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I have just been notified by Bob(dell4c) and Harry(hfbaker) that I have an error in the Financial Projections spreadsheet. The closing balance at the bank at the bottom of each year was being carried across as the opening balance at the start of the next year, but the opening balance is not being included in the calculation of the closing balance of the next year. The result being that we should have a lot more money by the end of 2025 than we originally had thought.
I have corrected the spreadsheet and we are considering how this affects the decisions that we had made regarding the ongoing fees. The correct models are posted below.
Five Year Financial Projection - Current Fees - Error Corrected.pdf
Five Year Financial Projection - Halve Membership-Fees - Error Corrected.pdf
I apologize for my error and I thank Bob and Harry for pointing it out. Harry and others have suggested alternate models which will be considered over the next few days as we consider what are the best alternatives going forward.
We will be back with more shortly.
Regards ... Tim.
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This posting is in response to the request by David(HolocaustStamps) for more transparency in the Stamporama finances. To date the Membership Team has not chosen to hide the Stamporama finances as such, just not to publish them for the world to see. Anyone who has contacted me asking for specific information on the finances, I have shared the Profit and Loss Statement as at 1/1/2022 that include the finance information that was used in the corporate tax filing both with the IRS and the State of Minnesota Revenue dept. The reason that we have so far decided not to publish the financial information to the general membership is that we could see a large number of pros and cons in doing so. We felt that sharing the information on the discussion board would create more bickering and infighting that it would solve. The Management Team believes that we have got to the point now where the benefits of more transparency outweighs the potential downside.
One of the things that the Management Team has been considering for a while is whether to continue on with the membership fees set as they are (Basic $12 and Expanded $18). The following two links provide access to two Five Year Financial Projection models. The first Five Year Projection model assumes that we continue with the membership fees as they are. The second Five Year Projection model assumes that in 2023 thru 2025 we halve the membership fees (Basic $6 and Expanded $9). In these models you will also see the membership counts and anticipated counts over the next three years.
See corrected Five Year Financial Projection models in post below.
Operating Expense Break Down for 2021 as submitted to the IRS
Please read the notes carefully at the bottom of each model so that you understand the assumptions made in producing the Five Year Projection.
Anticipating your Questions on Taxes:
Stamporama Inc. is a C Corp corporation not a 501(c3) non-profit organization. We have looked into what it would take for us to become a Non-Profit 501(c3) organization with the US Federal Government so that we would not have to pay taxes. For an organization of our size it will just cost too much. The process to achieve the Non-Profit 501(c3) status so that we would not have to pay tax is not something that we could undertake by ourselves. It would require us to engage a attorney (lawyer) which would cost at least $10,000. That was the experience of the Northern Philatelic Library that I'm involved with here in Minneapolis. Given that and David's experience working for a Non-Profit, the cost savings vs the cost to obtain the 501(c3) status plus the extra work to obtain it and maintain it on-going, means that the benefit is just not there. So, we have no option but to continue to pay taxes.
Membership Fee Reduction???
When looking at the second Five Year Financial Projection where we would halve the membership fees for years 2023 thru 2025 it is quite clear that a substantial reduction in membership fees is not financially viable in the long term and I can't see any point in just making a small reduction in the membership fees. Therefore the only responsible solution to ensure that Stamporama can continue for the long term is to continue with the membership fees as they currently stand.
Questions:
We know you will have many questions to this shared financial information, which we are very happy to answer. We hope this will give you as the members of Stamporama some insight into the way your membership fees are spent.
One final comment on the above financial projections, with the current rising costs for energy and inflation we anticipate higher costs for maintaining the website, meaning that we need to have some meat on the bones, to cover the unexpected. Yes, there's a decent amount of cash if all goes according to projections; and that's a good thing. We started this with the idea that we'd ride this for 2 or 3 years before re-evaluating our fees. So far, it looks good.
We looked at lowering rates, and rejected the notion, at least for now. We don't want to be in the position where we are begging for funds to keep afloat. Nor do we want to be so close to the bone that a fried circuit board shuts us down financially.
Some have asked for a monthly/quarterly financial report to the membership. I'm not going to post this information publicly on a monthly/quarterly basis because it would be very confusing for many people. 90% of the income comes in during May and June and the expenses are spread fairly evenly over the 12 months of the financial year. So depending on the month that you look at the finances, it will look as if we have a huge amount of money or it will look like we have just enough. I commit to providing the Profit and Loss Statement for the recent financial year to the membership in January each year, as a part of the tax return process.
Regards ... Tim.
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re: Stamporama Financial Projections
I have just been notified by Bob(dell4c) and Harry(hfbaker) that I have an error in the Financial Projections spreadsheet. The closing balance at the bank at the bottom of each year was being carried across as the opening balance at the start of the next year, but the opening balance is not being included in the calculation of the closing balance of the next year. The result being that we should have a lot more money by the end of 2025 than we originally had thought.
I have corrected the spreadsheet and we are considering how this affects the decisions that we had made regarding the ongoing fees. The correct models are posted below.
Five Year Financial Projection - Current Fees - Error Corrected.pdf
Five Year Financial Projection - Halve Membership-Fees - Error Corrected.pdf
I apologize for my error and I thank Bob and Harry for pointing it out. Harry and others have suggested alternate models which will be considered over the next few days as we consider what are the best alternatives going forward.
We will be back with more shortly.
Regards ... Tim.
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like this post.
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