March 2024 Operating Fund Financial Highlights

MANAGEMENT OVERVIEW

March 31, 2024

Balance Sheets

Cash and cash equivalents had a month-end balance of approximately $79.5 million. The balance decreased by $18.9 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 2024, at which time the Fund will collect the 2024 operating fees from its credit union members.

Amount due from National Credit Union Share Insurance Fund of $58.8 thousand represents the receivable for expenses paid by the Operating Fund.

Other accounts receivable, net had a month-end balance of $138.1 million. Its balance increased by $114.8 million from prior month.

Accounts payable are trade, relocation and inter-agency payables. The balance decreased by $3.1 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

Expenses in excess of revenues totaled $1.4 million 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 $18.9 million from prior month. In the current month, $18.8 million was used in operating activities, $87.7 thousand was used in investing activities, and $11.9 thousand was used in financing activities.

Other Information

The Agency had 40 vacancies as of month-end, which represents 3.2 percent of the total authorized staff of 1,252. Of the 40 vacancies, there were 14 vacancies under authorized positions in the central office and 26 vacancies under the authorized positions in the regions and Asset Management and Assistance Center (AMAC).

BALANCE SHEETS

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

ASSETS	March 2024	March 2023
Cash and cash equivalents	$79,505	90,027
Due from National Credit Union Share Insurance Fund	59	1,091
Other accounts receivable, net	138,099	114,168
Prepaid expenses and other assets	7,164	6,748
Operating lease right-of-use assets	1,843	206
Fixed assets¹	33,094	34,095
Intangible assets²	21,315	25,294
TOTAL ASSETS	$281,079	$271,629

LIABILITIES AND FUND BALANCE

LIABILITIES	March 2024	March 2023
Accounts payable and accrued other liabilities	$23,864	$21,135
Finance lease liabilities	134	167
Operating lease liabilities	2,042	217
Accrued wages and benefits	8,654	7,987
Accrued FECA and unemployment benefits	203	248
Accrued actuarial FECA benefits	3,664	3,283
Deferred revenue³	103,763	86,046
Accrued annual leave	24,849	24,266
TOTAL LIABILITIES	167,173	143,349
FUND BALANCE	113,906	128,280
TOTAL LIABILITIES AND FUND BALANCE	$281,079	$271,629

STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN FUND BALANCE

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

REVENUES	March 2024	Year-to-Date March 2024	Year-to-Date March 2023
Operating fees	$11,498	34,588	$28,682
Interest	365	1,197	1,128
Other	45	152	105
Total Revenues	11,908	35,937	29,915

EXPENSES, NET⁴	March 2024	Year-to-Date March 2024	Year-to-Date March 2023
Employee wages and benefits	$9,326	$27,531	$26,158
Travel	654	1,290	933
Rent, communications, and utilities	269	463	566
Contracted services	2,482	6,317	5,768
Depreciation and amortization	312	937	877
Administrative	280	381	472
Total Expenses, Net	$13,323	$36,919	$34,774
EXCESS OF REVENUES OVER / (UNDER) EXPENSES	(1,415)	(982)	(4,859)
FUND BALANCE—Beginning of period	115,321	114,888	133,139
FUND BALANCE—End of period	$113,906	$113,906	$128,280

STATEMENTS OF CASH FLOWS

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

CASH FLOWS FROM OPERATING ACTIVITIES	March 2024	Year-to-Date March 2024	Year-to-Date March 2023
Excess of revenues over (under) expenses	$(1,415)	$(982)	$(4,859)
Adjustments to reconcile excess of revenues over (under) expenses to net cash provided by operating activities before allocation to the NCUSIF:
Depreciation and amortization	826	2,485	2,312
Noncash operating lease expense	89	89	102
(Increase) decrease in assets:
Due from National Credit Union Share Insurance Fund	(59)	1,589	(1,072)
Other accounts receivable, net	(114,754)	(137,494)	(113,815)
Prepaid expenses and other assets	1,533	(1,469)	(2,077)
(Decrease) increase in liabilities:
Accounts payable	(3,141)	2,222	532
Operating lease liabilities	11	11	(108)
Accrued wages and benefits	(6,370)	(6,932)	(3,659)
Accrued FECA and unemployment benefits	34	34	64
Deferred revenue	103,763	103,763	86,046
Accrued annual leave	638	638	1,154
Accrued employee travel	-	(276)	(250)
Net Cash Provided by/(Used in) Operating Activities	(18,845)	(36,322)	(35,630)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of fixed and intangible assets	(88)	(348)	(1,344)
Net Cash Provided by/(Used in) Investing Activities	(88)	(348)	(1,344)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments under finance lease liabilities	(12)	(12)	(10)
Net Cash Provided by/(Used in) Financing Activities	(12)	(12)	(10)
NET INCREASE /(DECREASE) IN CASH AND CASH EQUIVALENTS	(18,945)	(36,682)	(36,984)
CASH AND CASH EQUIVALENTS—Beginning of period	98,450	116,187	127,011
CASH AND CASH EQUIVALENTS—End of period	$79,505	$79,505	$90,027
SUPPLEMENTAL DISCLOSURE OF NONCASH ACTIVITIES
Retirement of fully depreciated assets	$241	$241	$302
Acquisition of equipment under finance lease	-	-	(17)

The balances in the statement above are preliminary and unaudited.

¹ Net of accumulated depreciation of $45,020 and $41,107 as of March 31, 2024 and 2023, respectively.

² Net of accumulated amortization of $36,678 and $31,749 as of March 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.