Work Sample 1 - 2009 Annual Report


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The following is a sample of an annual report project coordinated and managed by Mary E. Harris.

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Work Sample 1 - 2009 Annual Report

  1. 1. Preserving the Dream 2009 Annual Report
  2. 2. Serving the Education Community.®1 Educational Systems FCU | 2009 Annual Report
  3. 3. Our mission is to grow by helpingthe members of theeducation communityachieve their financial goals and dreams.
  4. 4. Table of Contents Chairman and President/CEO’s Report 5 Treasurer’s Report 7 Statements of Financial Conditions 9 Statements of Income 11 Supervisory Committee’s Report 13 Independent Auditor’s Report 15 Serving the Education Community Photo Spread 16 Board of Directors 18 Supervisory Committee / Executive Officers 19 Locations 20 Educational Systems FCU | 2009 Annual Report Member Services 3
  5. 5. Last year, I graduated from Prince George’s CommunityCollege. While attending, I opened a membership withEducational Systems FCU. Thankfully I did, EducationalSystems FCU approved me for my first car loan. Even withresearch, their rates beat out all of their competitors.…
  6. 6. Chairman and President/CEO’s ReportE ducational Systems Federal Credit Union had one of its best years ever in 2009. The Credit Union continued to grow faster than mostother financial institutions and we are very pleased withour performance during this troubled economy. Memberscontinued to bring their savings dollars to the Credit Union operational impact on the Credit Union. Additionally, the Credit Union’s staff has been working with members who have been experiencing financial hardship to help them restructure their loans and stay in their homes. We are proud that we are helping our members work through these troubled the millions, and earnings, which are used to growreserves, kept pace to ensure the Credit Union remains Educational Systems Federal Credit Union is enteringsafe and sound. It is a testament to the vigilance of the its 55th year of serving the education community. Allvolunteers and staff of the Credit Union that we continue of our volunteer Directors and committee membersto prosper during these tough economic times. dedicate a significant amount of time every month serving you, our members, to ensure that your Credit UnionDuring 2009, we all witnessed unprecedented economic is safe and sound. It is by their selfless and supportiveconditions affecting our members, our Credit Union, and volunteer efforts that your Credit Union has continuedour country. Unemployment numbers hit the highest level to thrive. Service as a volunteer is rewarding. Membersin thirty years; stock market indexes hit the lowest levels in are encouraged to participate and if you are interesteda decade; real estate values declined dramatically; major in learning more about serving your Credit Union pleasecompanies sought and received government bailouts; contact the President/CEO.corporate malfeasance of well-established financial firmscontinued to make headlines; and new government Your Credit Union will continue to provide you withregulations in reaction to the crisis was more significant excellent service, competitive rates, and relevant financial Educational Systems FCU | 2009 Annual Reportthan seen in half a century. There were many challenges, education for your entire family. In times like these, it isand Educational Systems Federal Credit Union is proud our pleasure to provide you, our members, with a safeto be at your side helping to protect and preserve your haven for your savings and a convenient source for goals and dreams. Respectfully submitted,The economic firestorm during the past two years hasaffected all financial institutions, and your Credit Unionwas no exception. Issues such as increasing loan losses Rosemary Brinkley, Chairmanfrom members under financial distress, fraud perpetratedby a financial business partner, and the decreasing valueof mortgage securities have all impacted the Credit Union. Chris Conway, President/CEOFortunately, our staff and volunteers have been proactivein addressing these threats to mitigate their financial 5
  7. 7. After the economy took a turn for the worst, our family beganfeeling the pressures of the current recession. Expenses thatuse to be minimal for us, were now huge! When we beganexperiencing this, we immediately contacted our Credit Union.I’d read about the Balance Financial Fitness Program, and how itcould help you out. Balance helped my family to get on a budgetspending plan that has changed our lives forever.…
  8. 8. Treasurer’s ReportI n 2009, a year when our nation’s economy experienced one of its worst recessions in modern history, Educational Systems Federal Credit Unioncontinued its track record of financial success.Member deposits increased by $38 million, or 16.12%, in 2009 During a financial market full of turmoil in 2009, your Credit Union continued to offer loan rates and pay dividend rates that were highly competitive with other financial institutions. The continued strength that the Credit Union has been able to maintain through these troubled financial times will enable the Credit Union to continue to serve the education communityrepresenting the most significant increase in member deposits in for many years to come. We all recognize that 2009 was fullover 5 years. During this time of financial uncertainty, our increase of catastrophes, which the Credit Union continues to workin deposits shows just how much confidence our members have through, and there are signs that 2010 will also be just asplaced in their Credit Union. Loan growth continues to be a vital challenging. However, you can rest assured that your Creditpart of the Credit Union’s financial health. In 2009, the Credit Union is sufficiently positioned to meet the challenges that theUnion saw net loans increase by $16.6 million, or 9.05%. Although economic and regulatory environment might bring forward. Thethe Credit Union experienced net loan losses in 2009 of .56% financial strength of our reserves, the security of our federalcompared to 2008 when net loan losses were .18%, the Credit and additional private insurance and our excellent managementUnion’s losses were just over half of those of the Credit Union’s team makes Educational Systems Federal Credit Union a financialpeer group who had losses of .98%. Net Income in 2009 was a institution in which you can have much confidence.healthy $2.59 million which has increased the Credit Union’s totalCapital reserves to $31.8 million or 9.55% of average assets. This This Annual Report includes an Unqualified Opinion from the firmis important because this growth in Capital allows for growth of of Deleon & Stang, CPA on the Statement of Financial Conditionone of the Credit Union’s most important measures of success, and the Statement of Income and Expenses. These are excerptsasset growth. In 2009, the Credit Union’s assets grew by an from the annual Independent Auditor’s Report for 2009 which wasadditional $51.8 million, or 18.4%. In last year’s Annual Report, issued in February of 2010. Educational Systems FCU | 2009 Annual Reportwe anticipated the next significant asset growth milestone to be$300 million and as of the end of 2009 the Credit Union’s total Respectfully submitted,assets are over $333 million! Maurice Erly Treasurer Members Total Assets Loans to Members Shares and Savings Members’ Equity (in millions) (in millions) (in millions) (in millions) 350 200 300 35 300 250 30 150 $199.4 $333.0 250 25 $273.8 $182.8 200 $30.7 $165.1 $280.4 $235.8 $27.4 $27.1 200 20 $248.8 $148.8 $209.1 $24.2 $230.0 100 150 $196.6 150 15 100 100 10 50 50 50 5 0 0 0 0 2006 2007 2008 2009 2006 2007 2008 2009 2006 2007 2008 2009 2006 2007 2008 7
  9. 9. I’ve been a second grade teacher in Southern Marylandfor five years. I was so excited to find out aboutEducational System FCU’s In-School Branch Program.My students are eager to bring their deposits everyWednesday. It excites them to see their money grow.I’m so happy that Educational Systems FCU is committedto teaching our children the importance of moneymanagement.…
  10. 10. Statements of Financial Conditions December 31, 2009 and 2008 2009 2008 ASSETS Cash and cash equivalents $ 38,975,369 $ 14,706,348 Loans to members, net of allowance for loan losses 198,468,551 181,968,927 Investment securities Investment securities available-for-sale 41,775,954 48,544,946 Investment securities held-to-maturity 26,074,678 26,125,899 Other investments 8,484,267 1,591,385 Accrued interest receivable 506,326 574,186 Other receivables 11,270,128 743,581 Prepaid expenses and other assets 2,328,120 2,050,182 Premises and equipment, net of accumulated depreciation and amortization 2,661,151 3,003,458 Assets acquired in liquidation of loans 31,317 44,245 NCUSIF share insurance deposit 2,621,241 1,014,204 TOTAL ASSETS $333,197,102 $280,367,361 LIABILITIES AND MEMBERS’ EQUITY Educational Systems FCU | 2009 Annual Report LIABILITIES Accounts payable, accrued expenses and other liabilities $ 10,787,240 $ 2,060,701 Dividends payable — 138,228 Notes payable 17,951,429 14,982,857 TOTAL 28,738,669 17,181,786 MEMBERS’ SHARES AND SAVINGS ACCOUNTS Members’ shares and saving accounts 273,761,945 235,763,247 TOTAL LIABILITIES 302,500,614 252,945,033 MEMBERS’ EQUITY Members’ equity, partially restricted 30,696,488 27,422,328 TOTAL LIABILITIES AND MEMBERS’ EQUITY $333,197,102 $280,367, 9
  11. 11. After 15 years of service on my job, my hours weretemporarily reduced. I’ve always been able to pay mybills, but now without as much income, I really didn’tknow how I could make my next full mortgage payment.I contacted my Credit Union and let them know aboutmy current situation. Educational Systems FCU helped tomodify my mortgage payments so that I could keep myhome. Thank you so much…
  12. 12. Statements of Income December 31, 2009 and 2008 2009 2008 INTEREST INCOME Member loans $12,184,332 $ 11,175,708 Investment securities 3,753,205 3,987,488 TOTAL INTEREST INCOME 15,937,537 15,163,196 INTEREST EXPENSE Members’ share and savings accounts 5,235,561 5,710,412 Borrowed funds 629,495 514,410 Total interest expense 5,865,056 6,224,822 Net interest expense 10,072,481 8,938,374 Provision for loan losses (1,426,892) (591,467) NET INTEREST INCOME, AFTER PROVISION FOR LOAN LOSSES 8,645,589 8,346,907 NON-INTEREST INCOME Fees and other charges 8,809,533 8,223,642 TOTAL NON-INTEREST INCOME 8,809,533 8,223,642 Educational Systems FCU | 2009 Annual Report NON-INTEREST EXPENSES General and administrative 8,655,124 7,849,521 Compensation and benefits 4,535,401 3,782,302 Office occupancy and operations 1,374,394 1,206,026 Professional and outside services 518,032 306,606 Federal operating fees 66,378 63,261 Association dues 43,388 57,476 TOTAL NON-INTEREST EXPENSES 15,192,717 13,265,192 NON-OPERATING EXPENSES (INCOME) Non-operating (gains) losses (323,184) 900,923 Total non-operating expenses (income) (323,184) 900,923 NET INCOME $ 2,585,589 $ 2,404, 11
  13. 13. When our daughter turned 18, driving was the onlything on her mind! We couldn’t afford to purchase aNew Car for her to get back and forth from college,but could afford a Used Car. We were pleased to learnabout the partnership that Educational Systems FCU haswith Enterprise Car Sales! We found a great car that waswithin our budget at an even better rate.…
  14. 14. Supervisory Committee’s ReportI n accordance with the Federal Credit Union Act, the primary mission of the Supervisory Committee is to conduct internal andexternal audits designed to determine that: (1) accountingrecords and reports are prepared promptly and accuratelyreflect operations and their results; (2) established internal Overseeing the review of management practices and procedures is an important role and is critical to the safeguarding of all members’ assets. Your Supervisory Committee monitors regular updates to Educational Systems Federal Credit Union’s policies and procedures. Regular reports are submitted to the Board of Directorscontrols are effectively maintained and adequately for their analysis and actions regarding the safety andprotect the Credit Union, its members, its management, soundness of these policies and procedures.its employees; and (3) each unit of the Credit Union iscarrying out the plans, policies, and procedures for which Periodic member account verifications are also conductedit is responsible. to insure the integrity of Educational Systems Federal Credit Union’s account database. Moreover, theEducational Systems Federal Credit Union continues Committee monitors internal controls and external safetyto grow and our operations continue to become more and soundness operations with site visits to all Educationalcomplex. The Committee has a full-time Director of Internal Systems Federal Credit Union branches and departments.Audit to assist us as we carry out our mission. During In addition to observing physical branch operations,2009, our internal auditor performed comprehensive, in- Committee members and branch employees have thedepth audits and reviews of our departments, branches, opportunity for direct interaction with regard to concernsproducts and services. As we move forward into 2010, and ideas for improvement.please rest assured that your Supervisory Committee willcontinue to focus on maintaining our position as a safe, The Committee requests that members with concerns contact Educational Systems FCU | 2009 Annual Reportsound and strong credit union. the Supervisory Committee, in writing, at the following address: P.O. Box 179, Greenbelt, MD 20768-0179.The Committee ensures that financial statementsaccurately and fairly represent the financial conditions of Respectfully submitted,the Credit Union. For this purpose, a complete annual auditis conducted. Deleon & Stang Certified Public Accountantshas provided the Board of Directors and Committee W. Cecil Shortwith audit findings and recommendations in accordance Chairman, Supervisory Committeewith generally accepted principles. At the conclusion ofthe annual audit, the Supervisory Committee Chairman Michele Winston, Secretaryreviewed Educational Systems Federal Credit Union’s audit Alonia Sharps, Committee Memberanalysis with the National Credit Union Administration(NCUA) 13
  15. 15. When my husband lost his job this fall, our family’s householdincome went down tremendously. With our income decreasingso drastically, it really made it difficult to pay all of our billson time. When I contacted Educational Systems FCU to explainour situation, they helped our family get back on track withfinancial advice and options to help bring our bills current.We are so grateful…
  16. 16. Independent Auditor’s ReportBoard of Directors andSupervisory CommitteeEducational Systems Federal Credit UnionGreenbelt, MarylandWe have audited the accompanying statements of financial condition of the Educational Systems Federal Credit Union as ofDecember 31, 2009 and 2008 and the related statements of income, changes in members’ equity and cash flows for theyears then ended. These financial statements are the responsibility of the Credit Union’s management. Our responsibility is toexpress an opinion on these financial statements based on our audits.We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Thosestandards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statementsare free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts anddisclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimatesmade by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides areasonable basis for our opinion.In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of theEducational Systems Federal Credit Union for the years ended December 31, 2009 and 2008, and the results of its operations Educational Systems FCU | 2009 Annual Reportand cash flows for the same periods, in conformity with accounting principles generally accepted in the United States of America.As discussed in Note 17 to the financial statements, the Credit Union, as an insured claimant, is a co-defendant in a declaratoryjudgment action filed by Cumis Insurance Society, Inc. in the United States District Court for the Western District of Wisconsin,and it has filed a counter declaratory judgment and breach of contract action in the United States District Court for the Districtof Maryland. Preliminary hearings and discovery proceedings on both actions are in progress. The ultimate outcome of thematter cannot presently be determined. If unfavorable, the outcome of the matter would concretize a loss of up to nearly$5 million apart from legal fees, which is not reflected in the accompanying financial statements. DeLeon & Stang DeLeon & Stang, CPAs Gaithersburg, Maryland February 17, 2010 100 Lakeforest Blvd., Suite 650 • Gaithersburg, MD 20877 • Phone 301.948.9825 • Fax 301.948.3220 15 email: •
  17. 17. Serving the Education Community 1 5 2 6 3 7 4 8 1 DeLoria Savoy, AVP Member Services, taught the young men 5 Left to right: Lydia Gray, Marketing Coordinator; Elozino of Sky Walker Flight School Football Camp the importance of Ahworegba, Spelling Bee Winner; Vic Samuels, VP Marketing. managing their finances. 6 Marketta Lewis, Senior Member Service Representative, 2 Educational Systems FCU Management Team with Enterprise California Branch, assisting students at the Margret Brent Car Sales partners. Educational Systems FCU accepted the MVP Middle In-School Branch Grand Opening. award for most vehicles sold during a car sale! 7 Kenberly Johnson, School Financial Education Coordinator; 3 Left to right: Mary E. Harris, Marketing Manager; Victoria Hochstein, Dr. Charles Ridgell, St. Mary’s Board of Education Director of Graphic Designer; Vic Samuels, VP Marketing; Jennifer Brown, Curriculum and Instruction, at Margaret Brent Middle In-School Marketing Assistant; Lydia Gray, Marketing Coordinator; Antonio Branch Grand Opening. Boone, Academy of Finance Summer Intern. 8 Left to right: Zipporah Miller and son; Lydia Gray, Marketing 4 Left to right: Kenberly Johnson, School Financial Education Coordinator; Coordinator, and Jennifer Brown, Marketing Assistant at the Tiffanie Montgomery, Branch Manager, Prince Frederick Branch; Sonya 2009 Prince George’s County Annual S.T.E.M Fair. Kennedy, Branch Manager, Bowie Branch helped during new student orientation at Prince George’s Community College.16
  18. 18. 9 12 10 13 14 11 15 Educational Systems FCU | 2009 Annual Report9 Student competitor and judge at the 2009 Prince George’s 12 Staff holiday toy drive donations were made to Children’sCounty S.T.E.M Fair. National Medical Center. (Left to Right: Wanda Johnson, Accountant II; Jennifer Brown, Marketing Assistant; Ingrid Ramirez, Mortgage10 Left to Right: Dana DeFilippo, Bowie Baysox Community Loan Coordinator; Nahid Moghadam, VP Member Services; andCoordinator; Louie, Bowie Baysox Mascot; Corrine Fisher, Read Tameka Edmonds, Loan Quality Control Coordinator).and Hit a Home Run Poster Design Contest Winner; Lydia Gray,Marketing Coordinator, Educational Systems FCU. 13 Caleb-Rey Blancaflor, Read and Hit a Home Run Poster Design Contest Winner and Family.11 Dorecia Waisome, Senior Member Service Representative,Waldorf Branch celebrates with Mrs. Virginia McGraw, 14 Great Mills High School student Manuel Laungayan enjoyingJ. P. Ryon Elementary Principal. The Washington Post a hotdog while showing off high school and Credit Union spirit!2008-2009 Distinguished Educational Leadership Award forCharles County was presented to Mrs. McGraw who is also 15 Aerial view of DeLoria Savoy, AVP Member Services,one of our In-School Branch Principals. Mrs. McGraw received Educational Systems FCU, conducting a financial workshop withthe Principal of Excellence award. the parents at the 2009 Prince George’s County S.T.E.M 17
  19. 19. Board of Directors Rosemary Brinkley, Chairman Ms. Brinkley is a retired educator and administrator from Prince George’s County Public Schools and a former educator with Charles County Public Schools. Eva Chesley, Vice Chairman Mrs. Chesley is a retired educator from Charles County Public Schools. Maurice Erly, Treasurer Mr. Erly is a retired educator and administrator from Prince George’s County Public Schools. Dr. Jerome Clark, Secretary Dr. Clark is a retired educator, administrator, and past Superintendent of Prince George’s County Public Schools. John Neville, Director Mr. Neville is an educator and administrator with Prince George’s County Public Schools. George D. Denny, Jr., Director Mr. Denny is a retired educator, counselor and administrator from Prince George’s County Public Schools. Alonia Sharps, Director Mrs. Sharps is currently an administrator with Prince George’s County Community College.18
  20. 20. Supervisory Committee and Executive Officers Cecil Short, Chairman, Supervisory Committee Mr. Short is a retired educator and administrator from Charles County and Prince George’s County Public Schools. Michele Winston, Secretary, Supervisory Committee Mrs. Winston is currently an Internal Audit Supervisor with Prince George’s County Public Schools. Alonia Sharps, Member, Supervisory Committee Mrs. Sharps is currently an administrator with Prince George’s County Community College. Chris Conway President/Chief Executive Officer (standing, center) Girado Smith Educational Systems FCU | 2009 Annual Report Senior Vice President/Chief Financial Officer (standing, right) Wayne Beall Vice President/Chief Information Officer (standing, left) Laura Eacho Vice President of Lending & Collections (seated, left) Nahid Moghadam Vice President of Member Services (seated, right) Victoria Samuels Vice President of Marketing (seated, center) 19
  21. 21. Locations CORPORATE OFFICE MAILING ADDRESS P.O. Box 179 Greenbelt, MD 20768-0179 Toll Free: 800.356.6660 BRANCH OFFICES BOWIE Duvall Village Shopping Center 4801 Glenn Dale Road Bowie, MD UPPER MARLBORO Washington Plaza One 8903 Presidential Pkwy., Suite 100 Upper Marlboro, MD WALDORF Smallwood Village Center 169 A Smallwood Village Center Waldorf, MD GREENBELT Maryland Trade Center One 7500 Greenway Center Drive, Suite 140 Greenbelt, MD *CALIFORNIA San Souci Plaza 22599-122 Macarthur Blvd. California, MD *PRINCE FREDERICK Manning Building 90 King George Way Prince Frederick, MD *No Teller Services20
  22. 22. Member ServicesSAVINGS FOR YOUR CONVENIENCEChecking Accounts Free Online Banking and BillPayerCertificates Free eStatementsSpecial Purpose Club Accounts Free Online Check CopiesMoney Market Accounts Free Online Stop PaymentsTraditional and Roth IRAs Visa Debit CardsCoverdell Education Savings Audio Response Teller (ART) Direct DepositLOANS Payroll DeductionNew, Used and RV LoansPersonal (Signature) Loans INSURANCE COVERAGEFirst Trust Mortgages Share Insurance ($500,000)*Second Trust Fixed Rate Mortgages IRA Share Insurance ($500,000)*Home Equity Lines of Credit (HELOC) Credit Life Insurance**AlertLine (line-of-credit) Credit Disability Insurance** ®Visa Classic and Double Platinum Credit Cards Group Discount Auto/Home Owners** Route 66 Auto Warranty Other Insurance Programs Available** ADDITIONAL MEMBER SERVICES Signature Guarantees Travelers Cheques Money Orders Financial Seminars Balance Financial Fitness Program UBS Car Buying Service Savings Bonds* Your deposits are insured up to at least $500,000. The first $250,000 is federally insured by the National Credit Union Administration (NCUA), and backed by the full faith and credit of the United States Government. An additional $250,000 of coverage is provided by Excess Share Insurance (ESI), a private corporation. Traditional and Roth IRAs are insured up to $250,000 by NCUA, and up to an additional $250,000 through ESI, all at no cost to you.**Member purchased at group rates.
  23. 23. P.O. Box 179 • Greenbelt, MD 20768-0179 800.356.6660 •