ACS Financial Activities
At December 31, 2008, the American Chemical Society had approximately $991 million in assets and annual operating revenues of about $487 million. The Society’s financial activities are reflected in two major categories.
ACS Programs
Assets: $546 million
Revenues: $469 million
The Society, exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code, accomplishes its exempt purpose through a number of programs. These programs include membership and educational activities such as continuing education programs; national and regional meetings, which provide forums for sharing scientific information; and support for the Society’s membership in areas such as employment services and public outreach. In addition, the Society provides expert testimony at the federal, state, and local government levels on topics relevant to the chemical community. The Society also provides a significant service to its members and the chemical community in the form of databases pertaining to chemical and related scientific information that are available in electronic and hardcopy formats.
The principal sources of funding for the Society’s activities include net revenues generated by the Publications Division and the Chemical Abstracts Service (CAS) Division. The Publications Division publishes a wide range of scientific journals, periodicals, and books. CAS abstracts and indexes the world’s chemistry-related research literature from nearly 9,500 journals plus chemistry-related patents from 50 patent-issuing authorities around the world. CAS provides the world's largest and most current collection of chemical and related scientific information, including the most authoritative database of chemical substances, the CAS REGISTRYSM. CAS combines these databases with advanced search and analysis technologies to deliver the most complete, cross-linked, and effective digital information environment for scientific research and discovery. These include a suite of STN® products used by information professionals; the SciFinder®/SciFinder Scholar™ desktop tools used by scientists and students worldwide; and CD-ROM, printed reference resources; and search assistance through Science IP®. Other sources of the Society’s revenues include member dues, insurance premiums, registration fees, investment income, and contributions from individuals and institutions to support Society programs.
ACS Petroleum Research Fund
Assets: $445 million
Revenues: $29 million
The ACS Petroleum Research Fund (ACS PRF) was established in 1944 by seven oil companies as a perpetual trust to advance science education and fundamental research in the petroleum field. The American Chemical Society was designated in the original trust document as the income beneficiary responsible for administering the research grants program. In December 2000, as a result of a petition to the State of New York to increase the annual distributions from the Fund, the trust was terminated and the ACS was given complete control over the ACS Petroleum Research Fund, subject to the provisions for the use of the funds contained within the original founding documents. The provisions of the transfer agreement provided for the creation of a Fund endowment, totaling $72.5 million. This endowment is to be held inviolate and is therefore permanently restricted. The assets of the Fund consist primarily of domestic and international equities and fixed income securities.
Grants are made by the Society in accordance with the provisions of the ACS Petroleum Research Fund agreement and are funded through the Fund's temporarily restricted net assets, which totaled more than $319 million in 2008. The assets of the Fund consist primarily of domestic equities, foreign equities, and fixed income securities. Under the terms of the transfer agreement, annual payouts from the Fund are capped at a maximum spending rate of 5% of the net asset value of the Fund over a rolling three-year average. The Society uses distributions from the Fund to make grants to further the advancement of scientific education and research in the petroleum field. These grants are expensed when awarded by the ACS Board and accepted by the recipient. Grants that have been awarded and not yet accepted by grant recipients at December 31, 2008 totaled approximately $7,970,000.
Investment income earned on the Fund endowment is temporarily restricted until used to support the activities of the Fund, including administrative costs. Temporarily restricted funds are released from restriction in an amount exactly equal to the grants awarded and administrative expenses incurred each year. The net financial impact of the ACS Petroleum Research Fund on the unrestricted finances of the Society is therefore zero.