Monthly financial report

Time once again for the monthly state of affairs with Neualtenburg money. The reports are located here:

Neualtenburg Balance Sheet in Lindens
http://www.tospitimou.com/Neualtenburg/BalanceSheetLD.pdf

Neualtenburg Balance Sheet in US Dollars
http://www.tospitimou.com/Neualtenburg/BalanceSheet.pdf

Neualtenburg Income/Expense Report in Lindens
http://www.tospitimou.com/Neualtenburg/IncomeExpenseLD.pdf

Neualtenburg Income/Expense Report in US Dollars
http://www.tospitimou.com/Neualtenburg/IncomeExpense.pdf

There are also links to the US$ reports on the Finance page of the site.

Well, once again we had a very good month financially, although, as with October, many of the reasons were one time events. Lets look at the Income/Expense report first. As before, I'll refer to the US dollar reports.

"Land Tier Revenues", our monthly fees that we each pay, were a whopping $266! When the "mothers" of Neualtenburg first set up the system allocating "fair share" amounts to be due from each parcel of land, we tried to base our estimates not only on the $195 which we would have due each month, but also a fair share over that to cover the many other costs that we knew we'd have to pay: currency conversion costs, currency fluctuations, Paypal fees, and all the other costs of the city. Way back in April/May of this year, it was a real guess how that would work out. This month's performance shows that our guesses were pretty conservative.

We also didn't factor in any revenue other than the monthly fees, since we really had no idea how that would develop. One source of funds which we did not at all anticipate was the "resale" of property left to the city by former residents. Back in the summer, the City's receipts for land sales finally equalled what we had paid for the sim; i.e. we re-couped the purchase price. Any land sold after that point is basic revenue. This month it was $58.

The single "one-time" anomaly in the revenue is the $123 Miscellaneous Revenues. Back in Winter/Spring of 2005, Catfart Grayson, a former and very active member of Neualtenburg in Anzere gave L$30,000 to help us get through the transition to the new sim. At that time, I recorded the amount in the books as a loan, because at that time I felt it was the most appropriate way to treat it. But now, in November 2005, having not heard at all from Catfart (possibly he's no longer in SL), and remembering that he was quite clear that the money was a gift, I converted it from a loan to a gift (which means it is revenue). That is much of the $123, and it will obviously not re-occur.

On the expense side, we had very little other than the monthly payment to the Lindens. So, the net for the *month* was an amazing $222, leaving us with a positive net for the year (for the first time!) of $160.

Go next to the Balance Sheet. As I always mention, the Balance Sheet is the statement of everything we *own* minus everything we *owe*. The difference is what we are *worth*, the real money value of the enterprise. On the Balance Sheet, that amount is sometimes called "Net Worth", and on ours called "Equity".

And... major cause for celebration! For the first time Neualtenburg has a positive net worth! That hefty $222 profit for the month of November pushed us into being a company with a real net worth, $169. Each month the "profit" on the Income/Expense report adds itself to the Net Worth on the Balance Sheet from the previous month, coming up with the new Net Worth. This month, for the first time, we are above zero.

This has real implication for the life of Neualtenburg. First, we've shown that as an organization, we can generate dependable cash, actually run a profit in our city. That means that, first and foremost, we need to plan our financial affairs. We have historical information on which to base a budget; we're no longer groping in the dark. We can discuss projects that need to be done (and paid for), whether we wish to lower (or raise) our monthly fees; even discuss the steps we need to raise the cash if we want to buy a new sim. All of this has credibility now... now that we have shown that we can not only support our monthly payments, we can even build the city to a point where it has positive, real money value.

Second implication is for the Neualtenburg Bond proposal which was originated by Ulrika and recently approved by the RA. While its true that bonds could possibly always be repaid by issuing more bonds, the purchaser's faith and confidence in the enterprise itself is vastly improved (meaning, the value of the bond is vastly improved) by the demonstration that the city entity has, and can continue to maintain, positive net worth.

All in all, this report is my happiest since Neualtenburg first established itself on a private sim. Having a positive net worth is a significant measure of an enterprise's quality. And we have achieved that in 6 months of existence.


Sudane

I believe the only possible response is something along the lines of "kick ass!".

Gee, we're making it seem easy, for sufficently large values of "easy".

Woot! A few more months like that and well be able to expand to another sim!

Woot!