Neualtenburg Monthly Financial Report for May 2006

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Sudane Erato
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Neualtenburg Monthly Financial Report for May 2006

Post by Sudane Erato »

In the midst of "chaos" the month ends, which means, another monthly financial report.

Here are direct links to the reports..

Neualtenburg Balance Sheet in Lindens ... heetLD.pdf

Neualtenburg Balance Sheet in US Dollars

Neualtenburg Income/Expense Report in Lindens ... enseLD.pdf

Neualtenburg Income/Expense Report in US Dollars ... xpense.pdf

Btw, these are "set" links, with the actual reports being connected to changing each month. So, if you use these links after the month following the one reported on, you won't get the right report, you'll get the current one. We've had some discussion about getting all the historical reports up on the wiki, but, so far, they're only on my office computer.

Reports are also available thru the "Services/Finance" page on the website.

As usual, I refer to the US dollar reports.

Looking at the Income & Expense Report first. First, we did not lose money in May, but we came very close. The biggest reason: inflation. The value of the L$ against the US$ has skyrocketed. I used 345 L$/1US$ for the exchange rate, which is what it was on about May 24. On the day of writing this report, the rate was up to 353.

You can see on the report a very clear result of inflation. Look at the "Linden Land Tier Payment" line, under expenses. In January (or was it February?) when the budget was written, the budgeted figure was US$195, what it permanently is in US$. That figure is now effectively US$150.72 in today's exchange rate. That's a 33% inflation in the value of the L$ in only 4 months! Thats 100% per year!

Now it is true that we continually adjust the monthly fee for those who pay in L$'s to reflect this increase. All L$ payers will see this increase, and its pretty substantial each month. But I can only set the rate to what it is on a given day, and with the steady upward climb, this means that all those paying after that day are paying a reduced value, in US$ terms.

I have taken to resetting this number several times a month (causing some confusion among conscientious fee payers, for which I apologize). The rate is supposed to be set by law on the first day of each month, but considering this inflation climate, I have taken these liberties with the rule.

"Land Tier Revenues" (payment of monthly fees) is slightly behind budget. It would be much worse if we had not readjusted the rate. But it's also the case that perhaps our budget figures were a bit too ambitious, a problem we can correct with the next budget, due to be prepared next month (July). Also, as we've known already, we seriously overestimated receipts from "Miscellaneous Revenues", again, something we'll correct in the next budget.

All in all, its quite something that we broke even with a plus US$11 "Net Income".

Going to the Balance Sheet, at the bottom, the "Total Equity" i.e. the total value of the company is US$11 more than it was last month (because of the net income).

But, there are some interesting developments. Most significantly, the section called "Escrow Funds on Deposit" continues to grow, with the addition of Eldrich Financial. These are "Long Term Liabilities". meaning, they are indeed debt, money we may well have to pay back someday. There may even someday be interest required of these amounts. But, most important, these amounts are long term sources of cash for investments which we may need to make. Or, alternatively, they are cash sources providing that extra margin of security for the City; our "cushion" for hard times. These funds are indeed a useful resource.

One more note. Our Assets are "Current" (meaning basically cash) and "Fixed" (meaning things we've invested in, which are the Rathaus, the Fountain, and the Land Management software, phase one). As you can see, our cash balance is US$607.57, which is 83% of our Assets. A very good ratio I think.

Please don't hesitate to toss questions this way, either here, or via IM.



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