2021/22 Audit Report

By James Hardenberg, CPA, CGMA, CAE, NJCPA Chief Learning Officer and Interim CFO – November 18, 2022
2021/22 Audit Report

The combined financial statements for the New Jersey Society of CPAs and Affiliates (NJCPA Education Foundation and NJCPA Scholarship Fund) for the year ended May 31, 2022, have been published.

Fiscal 2022 mirrored fiscal 2021 in that it was executed almost exclusively on a virtual basis due to the ongoing, lingering effects of the coronavirus pandemic. NJCPA staff and volunteer leadership continually monitored the latest developments and evolving protocols throughout the year to keep the safety of members at the forefront of all programs and services. Three NJCPA chapters hosted seven in-person, face-to-face meetings from January through May, which attracted approximately 200 attendees. 

On a combined basis, unrestricted revenues decreased by 11.8 percent from the prior year, with much of the decrease attributable to market value declines for all investment portfolios combined, especially during the first five months of calendar 2022. Paycheck Protection Program (PPP) loan forgiveness helped offset these portfolio losses while education programs fees decreased as is commonplace at the start of a triennial licensing cycle. 

New Jersey Society of CPAs

For the Society, membership dues revenue was slightly higher compared to fiscal 2021; a small dues increase helped offset a reduction in dues paying members. Overall, membership declined by the end of May 2022, though nearly 75 percent of this decline was attributable to the Student and CPA Candidate member categories. 

Peer review fees also declined by 7.2 percent compared to the prior year as the number of firms in the program continued to be impacted by mergers, acquisitions and practitioner retirements. 

PPP loan forgiveness in fiscal 2022 also helped buoy the year-end results and offset the market value decrease in the NJCPA investment portfolio. Total expenses were held in check and decreased by 2.6 percent compared to the prior fiscal year. Overall, the Society experienced a solid increase of $868,000 in net assets. 

NJCPA Education Foundation

The Foundation continued to operate in a “virtual-first” mode due to the lingering effects of the pandemic. After a record reporting year in fiscal 2021, which captured the calendar 2020 triennial attendance spike as well as the CPE compliance extension granted by the New Jersey State Board of Accountancy through June 2021, attendance declined as is common at the start of each licensing cycle. Program fee revenue decreased by 24.7 percent in fiscal 2022 compared to the prior fiscal year though the volume of virtual program alliance opportunities continued to expand. The Foundation ended the fiscal year with a negative change to net assets of $101,000, and though a negative result was expected, it was better than budgeted. 

NJCPA Scholarship Fund

With NJCPA chapters only beginning to re-open toward the back half of the fiscal year, chapter contributions to the Fund were again held back for a second year in a row. However, the Fund still managed to provide $328,000 in scholarships during the fiscal year. The Fund’s investment portfolio also experienced similar declines as the Society and the Foundation with the results being a $332,000 negative change to net assets.