June 2024 Operating Fund Financial Highlights

MANAGEMENT OVERVIEW

June 30, 2024

Balance Sheets

Cash and cash equivalents had a month-end balance of approximately $187.1 million. The balance decreased by $6.3 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 $0.0 thousand represents the receivable for expenses paid by the Operating Fund.

Other accounts receivable, net had a month-end balance of $504.9 thousand. Its balance increased by $182.8 thousand from prior month.

Accounts payable are trade, relocation and inter-agency payables. The balance increased by $2.0 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 $100.3 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 $6.3 million from prior month. In the current month, $6.0 million was used in operating activities, $225.3 thousand was used in investing activities, and $12.4 thousand was used in financing activities.

BALANCE SHEETS

As of June 30, 2024 and 2023 (Dollars in thousands)

ASSETS	June 2024	June 2023
Cash and cash equivalents	$187,144	$176,953
Employee advances	15	-
Other accounts receivable, net	505	430
Prepaid expenses and other assets	9,026	7,001
Operating lease right-of-use assets	1,754	103
Fixed assets¹	32,067	34,882
Intangible assets²	20,459	24,186
TOTAL ASSETS	$250,970	$243,555

LIABILITIES AND FUND BALANCE

LIABILITIES	June 2024	June 2023
Accounts payable and accrued other liabilities	$26,021	$23,251
Finance lease liabilities	121	157
Operating lease liabilities	2,053	109
Accrued wages and benefits	10,692	10,025
Accrued FECA and unemployment benefits	247	330
Accrued actuarial FECA benefits	3,664	3,283
Deferred revenue³	69,174	57,364
Accrued annual leave	25,543	24,996
TOTAL LIABILITIES	137,515	119,515
FUND BALANCE	113,455	124,040
TOTAL LIABILITIES AND FUND BALANCE	$250,970	$243,555

STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN FUND BALANCE

For the periods ended June 30, 2024 and 2023 (Dollars in thousands)

REVENUES	June 2024	Year-to-Date June 2024	Year-to-Date June 2023
Operating fees	$11,529	$69,175	$57,364
Interest	800	3,430	3,119
Other	47	275	197
Total Revenues	12,376	72,880	60,680

EXPENSES, NET⁴	June 2024	Year-to-Date June 2024	Year-to-Date June 2023
Employee wages and benefits	$8,818	$55,120	$51,517
Travel	560	3,091	2,879
Rent, communications, and utilities	234	870	1,065
Contracted services	2,112	12,434	11,529
Depreciation and amortization	311	1,871	1,781
Administrative	241	927	1,008
Total Expenses, Net	$12,276	$74,313	$69,779
EXCESS OF REVENUES OVER / (UNDER) EXPENSES	100	(1,433)	(9,099)
FUND BALANCE—Beginning of period	113,355	114,888	133,139
FUND BALANCE—End of period	$113,455	$113,455	$124,040

STATEMENTS OF CASH FLOWS

For the periods ended June 30, 2024 and 2023 (Dollars in thousands)

CASH FLOWS FROM OPERATING ACTIVITIES	June 2024	Year-to-Date June 2024	Year-to-Date June 2023
Excess of revenues over (under) expenses	$100	$(1,433)	$(9,099)
Adjustments to reconcile excess of revenues over (under) expenses to net cash provided by operating activities before allocation to the NCUSIF:
Depreciation and amortization	824	4,958	4,700
Noncash operating lease expense	89	178	205
(Increase) decrease in assets:
Due from National Credit Union Share Insurance Fund	216	1,648	19
Employee advances	(15)	(15)	-
Other accounts receivable, net	(183)	100	(77)
Prepaid expenses and other assets	1,725	(3,331)	(2,331)
(Decrease) increase in liabilities:
Accounts payable	1,995	4,374	2,650
Operating lease liabilities	11	22	(216)
Accrued wages and benefits	12	(4,893)	(1,621)
Accrued FECA and unemployment benefits	45	79	146
Deferred revenue	(11,529)	69,174	57,364
Accrued annual leave	695	1,333	1,884
Accrued employee travel	-	(276)	(250)
Net Cash Provided by/(Used in) Operating Activities	(6,015)	71,918	53,374
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of fixed and intangible assets	(225)	(937)	(3,412)
Net Cash Provided by/(Used in) Investing Activities	(225)	(937)	(3,412)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments under finance lease liabilities	(12)	(24)	(20)
Net Cash Provided by/(Used in) Financing Activities	(12)	(24)	(20)
NET INCREASE /(DECREASE) IN CASH AND CASH EQUIVALENTS	(6,252)	70,957	49,942
CASH AND CASH EQUIVALENTS—Beginning of period	193,396	116,187	127,011
CASH AND CASH EQUIVALENTS—End of period	$187,144	$187,144	$176,953
SUPPLEMENTAL DISCLOSURE OF NONCASH ACTIVITIES
Retirement of fully depreciated assets	$336	$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 $45,904 and $42,160 as of June 30, 2024 and 2023, respectively.

² Net of accumulated amortization of $37,930 and $33,084 as of June 30, 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.