It’s the time of year for breaking New Year’s resolutions and paying annual fees to the ABR.
In honor of the season, from the American Board of Radiology’s blog:
“In October, we posted on our website the most recent financial statements for the ABR and the ABR Foundation. Postings include the 2020 990 forms and statements of financial standing for the year ending December 31, 2020.
Additionally, since 2017, the ABR has earned GuideStar’s Platinum status, the highest level of organizational transparency recognition.”
I can appreciate the desire to toot your own horn but perhaps less so the justification for self-congratulation.
The ABR, like all nonprofits, must furnish their Form 990 every year. The additional financial statements they recently posted online essentially contain the highlights from this mandatory filing. They are the same documents I’ve also personally obtained in the past in response to a request for greater financial transparency/information. They are overall less detailed and differ only in some minor categorical changes due to their nature as documents intended for internal review and not regulatory compliance.
Now, this is of course outside my wheelhouse—I’m not a compliance officer at a nonprofit nor a federal auditor—but essentially doing the minimum is—to me—not a cause for celebration or even the sweet semi-embrace of patting your own back. I don’t expect a high five for not stealing nor a gold star for filing my taxes on time every year. Those are the rules. And if that small effort places the ABR in rarefied company amongst nonprofits, that probably says more about the United States’ implementation of the nonprofit tax designation than it does about the ABR.
In case you were curious, the ABR said it lost $4.2 million dollars in 2020 from their…strategic reserve of $46+ million. The ABR’s functional expenses have typically ranged from $13-15 million during the recent period from 2012-2017 and up to $17.2 million in 2018. 2020? $24 million.
The two biggest expenses in 2020 according to the financial statements were $11.2 mil for “office expenses” and $9.8 mil for “personnel expenses.” Some of the financial statement numbers differ slightly from the Form 990 for reasons I wouldn’t pretend to understand, but the official document breaks down that office expense a bit further and attributes $8.7 mil of it to “occupancy” (according to the IRS that’s “rent; heat, light, power, and other utilities expenses; property insurance; real estate taxes; mortgage interest; and similar occupancy-related expenses”).
That occupancy figure is a big jump. Here’s what it’s been in recent years:
I sent the ABR a congratulatory email about their Guidestar Platinum status and asked if they could provide some more information about this portion of their functional expenses and in particular the significant jump during the pandemic. To his credit, Executive Director Wagner personally responded:
The amount in question includes costs related to our commitment to a fully remote testing model during 2020. Some of the specifics of these transactions are bound by standard non-disclosure terms with outside firms.
I know you’re thinking that $7+ million in additional occupancy expenses for a testing process that involves less, umm, occupancy is a bit counterintuitive. Unfortunately no details were forthcoming, but one potential large expense could have been a commercial lease buyout for the now-defunct large exam center in Chicago (the ABR owns its office building in Tuscon).
In related news, I had also inquired about that lease, and he was gracious enough to provide a very specific answer:
As of January 31, 2022, the ABR will have no active lease agreements, so our occupancy costs will be significantly lower moving forward.
The lease is up mere days from now. Therefore, in this new world of platinum transparency and financial stewardship, candidates and diplomates should almost certainly expect a significant decrease in fees next year.