August 2024 Operating Fund Financial Highlights

MANAGEMENT OVERVIEW

August 31, 2024

Balance Sheets

Cash and cash equivalents had a month-end balance of approximately $160.5 million. The balance decreased by $15.7 million for the month primarily due to cash disbursements for operating expenses and capital expenditures. The cash position is considered sufficient to cover current and future budgetary obligations of the Fund through April 2025, at which time the Fund will collect the 2025 operating fees from its credit union members.

Amount due from National Credit Union Share Insurance Fund of $27.8 thousand represents the receivable for expenses paid by the Operating Fund.

Other accounts receivable, net had a month-end balance of $497.2 thousand. Its balance increased by $213.7 thousand from prior month.

Accounts payable are trade, relocation and inter-agency payables. The balance increased by $1.4 million for the month primarily due to vendor/trade and overhead transfer payables.

Accrued wages and benefits are earned by NCUA staff, but remain unpaid at month-end.

Accrued annual leave is leave earned by NCUA staff, but not yet used.

Statements of Revenues, Expenses, and Changes in Fund Balance

Revenues in excess of expenses totaled $324.2 thousand for the month. Operating fee revenue reflects one-twelfth of the 2024 Operating Fees. Expenses, net are after the overhead transfer rate adjustment that allocates a portion of expenses to the Share Insurance Fund.

Statements of Cash Flows

The cash position decreased $15.7 million from prior month. In the current month, $14.7 million was used in operating activities, $980.1 thousand was used in investing activities, and there were no financing activities.

BALANCE SHEETS

As of August 31, 2024 and 2023 (Dollars in thousands)

ASSETS	August 2024	August 2023
Cash and cash equivalents	$160,547	$159,075
Due from National Credit Union Share Insurance Fund	28	-
Employee advances	13	-
Other accounts receivable, net	497	536
Prepaid expenses and other assets	9,906	8,244
Operating lease right-of-use assets	1,754	103
Fixed assets¹	32,351	34,821
Intangible assets²	20,163	23,802
TOTAL ASSETS	$225,259	$226,581

LIABILITIES AND FUND BALANCE

LIABILITIES	August 2024	August 2023
Accounts payable and accrued other liabilities	$25,068	$23,426
Finance lease liabilities	121	157
Operating lease liabilities	2,053	109
Accrued wages and benefits	8,589	14,118
Accrued FECA and unemployment benefits	247	330
Accrued actuarial FECA benefits	3,664	3,283
Deferred revenue³	46,116	38,242
Accrued annual leave	25,543	24,996
TOTAL LIABILITIES	111,401	104,661
FUND BALANCE	113,858	121,920
TOTAL LIABILITIES AND FUND BALANCE	$225,259	$226,581

STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN FUND BALANCE

For the periods ended August 31, 2024 and 2023 (Dollars in thousands)

REVENUES	August 2024	Year-to-Date August 2024	Year-to-Date August 2023
Operating fees	$11,529	$92,233	$76,485
Interest	735	4,962	4,563
Other	33	353	261
Total Revenues	12,297	97,548	81,309

EXPENSES, NET⁴	August 2024	Year-to-Date August 2024	Year-to-Date August 2023
Employee wages and benefits	$9,071	$73,736	$68,332
Travel	607	4,328	4,128
Rent, communications, and utilities	205	1,273	1,394
Contracted services	1,543	15,407	14,926
Depreciation and amortization	326	2,521	2,414
Administrative	221	1,313	1,334
Total Expenses, Net	$11,973	$98,578	$92,528
EXCESS OF REVENUES OVER / (UNDER) EXPENSES	324	(1,030)	(11,219)
FUND BALANCE—Beginning of period	113,534	114,888	133,139
FUND BALANCE—End of period	$113,858	$113,858	$121,920

STATEMENTS OF CASH FLOWS

For the periods ended August 31, 2024 and 2023 (Dollars in thousands)

CASH FLOWS FROM OPERATING ACTIVITIES	August 2024	Year-to-Date August 2024	Year-to-Date August 2023
Excess of revenues over (under) expenses	$324	$(1,030)	$(11,219)
Adjustments to reconcile excess of revenues over (under) expenses to net cash provided by operating activities before allocation to the NCUSIF:
Depreciation and amortization	864	6,682	6,375
Noncash operating lease expense	-	178	205
(Increase) decrease in assets:
Due from National Credit Union Share Insurance Fund	17	1,620	19
Employee advances	-	(13)	-
Other accounts receivable, net	(214)	108	(183)
Prepaid expenses and other assets	(231)	(4,211)	(3,574)
(Decrease) increase in liabilities:
Accounts payable	1,422	3,423	2,825
Operating lease liabilities	-	22	(216)
Accrued wages and benefits	(5,334)	(6,997)	2,472
Accrued FECA and unemployment benefits	-	79	146
Deferred revenue	(11,529)	46,116	38,242
Accrued annual leave	-	1,333	1,884
Accrued employee travel	-	(276)	(250)
Net Cash Provided by/(Used in) Operating Activities	(14,681)	47,034	36,726
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of fixed and intangible assets	(980)	(2,650)	(4,642)
Net Cash Provided by/(Used in) Investing Activities	(980)	(2,650)	(4,642)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments under finance lease liabilities	-	(24)	(20)
Net Cash Provided by/(Used in) Financing Activities	-	(24)	(20)
NET INCREASE /(DECREASE) IN CASH AND CASH EQUIVALENTS	(15,661)	44,360	32,064
CASH AND CASH EQUIVALENTS—Beginning of period	176,208	116,187	127,011
CASH AND CASH EQUIVALENTS—End of period	$160,547	$160,547	$159,075
SUPPLEMENTAL DISCLOSURE OF NONCASH ACTIVITIES
Retirement of fully depreciated assets	$-	$578	$302
Acquisition of equipment under finance lease	$-	$-	$(18)

The balances in the statement above are preliminary and unaudited.

¹ Net of accumulated depreciation of $46,881 and $42,989 as of August 31, 2024 and 2023, respectively.

² Net of accumulated amortization of $38,677 and $33,931 as of August 31, 2024 and 2023, respectively.

³ The Operating Fund recognizes operating fee revenue ratably over the calendar year. The deferred revenue is the remaining amount to be recognized over the remainder of the calendar year.

⁴ Operating Fund expenses are the total NCUA operating expenses reduced by the Share Insurance Fund allocation as determined by the overhead transfer rate.