ACS Financial Information - FAQs

Committee Communication

  1. Does the ACS Budget & Finance (B&F) website provide an opportunity for members to submit questions?

Yes. There is a feature on the B&F website that allows any user to provide feedback by email as well as ask questions of a financial nature. This link alerts Finance Staff that a question has been proposed and it will be routed to the staff person best suited to provide an appropriate answer.

Please go to the B&F website and select “Feedback” to enter your question.

  1. Are reports available on ACS financial matters at both National Meetings?

Yes, at each National Meeting members of the Society Committee on Budget & Finance provide brief financial updates at the District Caucus sessions. In addition to information presented at the B&F Committee meetings, the Society’s audited financial statements and several other financial documents (i.e., IRS Form 990’s)  are available on the public B&F website. 


  1. How are salaries of ACS Executives set?

The Board engages external consultants who compare ACS jobs to comparable positions outside the Society to identify market value for the positions. The independent compensation consultants also inform the Board’s decision-making about pay policy and practice. This helps ensure that ACS remains competitive and can attract and retain key management talent. The consultants’ data and recommendations are reviewed in depth by a Board-appointed Committee on Executive Compensation.  This committee reports regularly to the ACS Board where final decisions are made. Consultants are changed periodically to ensure objectivity and diversity in the benchmarking process.

  1. How are Executive Incentive Plans determined?

Incentives linked to performance are common in both the not-for-profit sector and for-profit sectors. They represent “at risk” pay, meaning that they are only paid when targeted performance or pre-established objectives are achieved. Incentive opportunities drive performance on projects that are in addition to core job responsibilities. Incentives can drive innovation and that allows the ACS to expand its products and services to leverage the latest technology and achieve cost savings.  The Board-appointed Committee on Executive Compensation (referenced earlier) makes recommendations to the Board of Directors to approve incentive objectives and payouts for the top ACS executives.

  1. Is ACS staff paid fair market salaries?

Similar to executive pay practices, the ACS periodically conducts staff-level salary benchmarking to ensure that the Society remains able to compete for talent in the open marketplace and retain staff.

  1. What would happen if staff salaries were lower?

If ACS did not pay market competitive compensation, the Society would be hampered in its ability to attract and retain highly qualified staff, managers and executives. Competitive compensation is an investment in the organization’s human resources.  The Society competes with private sector employers and other not-for-profits for new employees as well as the retention of its current employees.  Base salary is a significant factor within the competitive market.  It has been the experience at the Society, that lower-than-market salaries resulted in longer than expected candidate searches as ‘first choice’ candidates typically choose higher salaried positions, all other factors being the same.  This dynamic is also a factor in the retention of existing employees.

  1. What are the members of the Board and the Presidential Succession paid?

As members of ACS who are elected by the membership, the ACS Board and members of the Presidential Succession are volunteers and are not compensated for their service.  Board members’ travel and registration expenses are reimbursed when they are attending ACS-related meetings in their capacities as Board members.

  1. How many ACS employees are there?

Effective December 31, 2014, ACS employed: 

  • 2,020 employees (560 are based in Washington, DC and 1,460 are based in Columbus, Ohio)
  • 1,897 full-time staff and 123 part-time staff

Invested Funds

  1. How are the Society’s funds invested?

The Society invests in both short-term and long-term instruments.  Funds needed to satisfy short-term, or normal operating obligations are invested in short-term instruments such as bank deposits, money market funds and commercial paper.  Funds that are not required for short-term needs are invested in the ACS Investment Pool, which is a broadly diversified, long-term balanced investment portfolio.  The primary investment objective of the ACS Investment Pool is to earn an annual real or inflation-adjusted total return of 5.5%. A secondary objective is to generate current income.  The investment portfolio has a normal allocation of 50% stocks, 48% bonds, and 2% cash equivalents.  Market conditions may result in stock holdings ranging from a minimum of 40% to a maximum of 60% of total assets. The Investment Pool invests in domestic stocks, foreign stocks and bonds. All investments are handled by external investment management firms selected and monitored by the Board Standing Committee on Pensions and Investments. Performance of individual managers, as well as the overall Investment Pool, is measured on a quarterly basis by an independent consulting firm. At December 31, 2014, the Investment Pool had total assets of $355 million.

Net Assets

  1. What are the Society’s net assets, and how large should they be?

The Society’s net assets are calculated by subtracting total liabilities from total assets. It is important to note that net assets do not equal cash. In other words, an organization having substantial net assets does not necessarily have liquid assets available to spend on new initiatives. ACS net assets are in the form of unrestricted, temporarily restricted, and permanently restricted net assets. Excluding temporarily restricted and permanently restricted net assets, as well as two specific areas of the ACS, the ACS Petroleum Research Fund and the Member Insurance Program, ACS had $145 million in unrestricted net assets at the end of 2014. The reserve target is equal to a minimum of 50% of the next year’s projected operating expenses. For 2015, the unrestricted net asset target would be $249 million

Unrestricted Net Assets generally result from revenues earned by providing services, receiving unrestricted contributions, receiving dividends or interest from investing in income-producing assets and investment gains, less expenses incurred in providing services, raising contributions and performing administrative functions.

See Question 12 for a further explanation of Temporarily Restricted Net Assets and Permanently Restricted Net Assets

Additional information can be found at ACS Petroleum Research Fund and ACS Member Insurance Program.

Financial Guidelines

  1. How were the Society’s financial guidelines chosen? What do they mean?

The Society's financial guidelines have evolved from a series of Financial Planning Conferences dating back to the 1970s. Typically, members of Society Governance from the ACS Board of Directors and the Society Committee on Budget & Finance attending the conferences review the guidelines, as well as the Society's historic financial performance. Conference participants reaffirm or recommend revisions to the guidelines as conditions warrant. Final authority for establishing the Society's financial guidelines rests with the ACS Board of Directors. The current guidelines are as follows: 

A. Current ratio provides an indication of whether the organization has sufficient liquid assets to meet its short-term obligations as they come due. It is defined as the ratio of current assets to current liabilities and is calculated using information from the Society’s balance sheet, current assets, and current liabilities. The Society has a current ratio target of 0.65, which means the Society’s current assets are expected to equal approximately 65% of current liabilities.

B. Debt ratio is used to assess the organization’s level of, or dependency on, long-term borrowings. This ratio is useful in forecasting an organization’s long-term solvency. It indicates the relative contributions that creditors and owners have made to the financing of assets. It is defined as the ratio of total debt incurred by the Society to the Society’s unrestricted net assets. A maximum debt ratio of 50% has been established. This means that the total debt incurred by the Society will not exceed an amount equal to 50% of the Society’s unrestricted net assets. This maximum percentage was established because, from the Society’s point of view and the view of credit rating agencies (i.e., S&P, Moody’s), excessive debt is undesirable because it carries obligations and restrictions imposed by the creditor.

C. Free cash flow is an indication of the amount of cash being generated by the operations of an organization less expenditures for capital purchases. The Society established a guideline that free cash flow should be positive over a three year rolling average.

D. Fund balance ratio is a rough indication of the adequacy of the Society’s unrestricted net assets (or reserves).  It is computed by comparing the current year’s unrestricted net assets to the following year’s budgeted operating expenses. The ratio is intended to measure whether the Society has sufficient reserves to cover a catastrophic uninsured event, operating deficits, changes in accounting standards, and investment losses.  This ratio reflects the percentage of next year’s operating expenses that could be paid if all of the Society’s assets were converted to cash and all debt and obligations paid in full. The target for the Society’s fund balance ratio has been established at a minimum of 50% of the next year’s projected operating expenses.

E. Sustainability ratio is a measure of the Society’s operating performance and is calculated as net contribution *1 from operations divided by gross operating revenue *2. The ACS Board of Directors has established a range for the sustainability ratio of between 2.50% and 5.00%.

*1   Net Contribution from Operations:  Net contribution is calculated by subtracting all operating expenses from all operating revenue sources.

*2   Gross Revenue:  Gross revenue is defined as total operating revenue received before subtracting any operating expenses. 

  1. What does the term “restricted net assets” mean?

A. Restricted net assets represent endowments and contributions received from donors that are designated for specific programs (i.e., Project SEED, ACS Scholars Program, etc.).  These funds are reserved for a specific purpose, and cannot be used by the Society for general operating expenses.  Only the donor may restrict the use of these assets and this provision precludes the Society from restricting its own funds.  There are two classes of restricted net assets: permanently restricted net assets and temporarily restricted net assets. 

B. Permanently restricted net assets are limited by the donor in perpetuity. The initial corpus of these funds may not be spent for any reason.  They are to be invested and the investment income and any investment gains can be spent as governed by a charter, referred to as a “founding document”, that clearly states the purpose for which the funds are to be used. An example of a program with permanently restricted net assets is the ACS Petroleum Research Fund.

C. Temporarily restricted net assets represent contributions made to the Society for a specific purpose, event, and/or time period. These contributions, not just the investment income and gains, can be used to support a particular program or fund a specific event. Donors can place constraints or conditions on their gifts to the Society, which are clearly detailed in the related founding documents. Grants and Awards is an example of a program supported by temporarily restricted funds. All other financial activity of the Society, such as revenue generated from membership dues or from the sale of publications, is considered unrestricted and is available to be used for general operating expenses.

  1. Why does the ACS Petroleum Research Fund appear to have no impact on the financial performance of the Society?

As the ACS Petroleum Research Fund (PRF) incurs expenses, the Society offsets those expenses by releasing funds from temporarily restricted net assets that were contributed to support PRF activities.  As a result, there is no impact on the Society's net contribution from operations.  The PRF can do this because funding for PRF is completely comprised of temporarily and permanently restricted net assets.

  1. As a 501(c)(3) not for profit organization, why does the Society generate sizable Net Contributions from Operations?

To meet its mission it is critical that the American Chemical Society remain financially strong with adequate unrestricted net assets.  Sufficient reserves are required to survive an uninsured catastrophic event, absorb operating deficits, cover investment losses, and finance a strategic acquisition (such as an acquisition to complement current ACS products or services or an acquisition to provide new products or services to ACS members and product users). By generating a positive net contribution from operations, the Society can better ensure reserves will be maintained at a level sufficient to support its annual budget of approximately $500 million.

To be tax-exempt under section 501(c)(3) of the Internal Revenue Code, an organization must be organized and operated exclusively for exempt purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual. In addition, it may not be an action organization (i.e., it may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates). ACS meets these definitions.

  1. What is ACS’s current financial condition?

The Society’s overall financial condition is strong. The Society ended 2014 with a positive net contribution from operations. Despite a highly challenging economic environment, the 2014 financial results represent the eleventh consecutive year of positive net contribution from operations.  Unfortunately, despite the Society’s positive net contribution from operations and investment gains, unrestricted net assets declined in 2014 caused by significant accounting charges related to the Society’s postretirement benefit plans (PRBP – Defined Benefit Pension Plan and Retiree Medical Plan).  The accounting charges were a result of the Society’s implementation of new mortality tables and a decline in the discount rate used to value the Society’s PRBP liabilities at year end.  Unrestricted net assets totaled $144.7 million at December 31, 2014, a decline of $62.3 million from 2013.

  1. What is a form 990? What is in it?

The IRS Form 990 is an annual information return (Return of Organization Exempt for the Income Tax) that federally tax-exempt organizations must file with the Internal Revenue Service. It provides information on the tax-exempt organization’s mission, programs, finances, governance and management policies, and disclosure practices (e.g., Non-profits are required to make certain tax documents available for public inspection. The three most recent information returns (Form 990 or 990-EZ) and its application for exempt status (Form 1023) must be made available for inspection upon request.) ACS posts its 990s on its public website and provides four years’ worth of filings.

  1. What is a form 990-T? What is in it?

The IRS Form 990-T is an income tax return (Exempt Organization Business Income Tax Return) that an exempt organization must file with the Internal Revenue Service if it has $1,000 or more of gross income from an unrelated trade or business. Even though an organization is recognized as tax exempt, it may be liable for tax on unrelated business income.

  1. What is Unrelated Business Income Tax (UBIT)?

UBIT is an acronym for the phrase “Unrelated Business Income Tax”. For most organizations, an activity is an unrelated business (and subject to UBIT) if it meets three requirements:

1) It is a trade or business,

2) It is regularly carried on, and

3) It is not substantially related to furthering the exempt purpose of the organization.

  1. Is the ACS tax return available to members?

The public inspection copies of the American Chemical Society’s Form 990 (Return of Organization Exempt From Income Tax) are available to members and the public through ACS Financial Information.

The Society’s tax return, Form 990-T (Exempt Organization Business Income Tax Return), is made available upon request from the ACS Tax office at

  1. Is there an IRS limitation on the amount of unrestricted net assets a 501(c)(3) can accumulate?

There are no IRS limitations on the amount of unrestricted net assets a 501(c)(3) can accumulate.

National Meetings

  1. How are national meeting registration fees determined?

The National Meeting Long Range Financial Plan was adopted in 1998 and includes a Consumer Price Indexed (CPI) calculation that determines the Early Member Registration Rate for National Meetings. The current Early Member Registration fee is increased by the change in the previous 2 years CPI and ensures registration rates are increased consistent with inflation.

Member Dues

  1. What, precisely, are the dues used for?

Dues are used to support bylaw-related allocations and allotments, the internal costs related to collecting member dues, and the member database and call center that provides customer support. After these costs are covered the remaining net dues in 2014, of approximately $380,750, are used to support Society Programs, products, and services provided to members. 

Dues collected at year-end 2014 are just over $15,483,212:

A. 42% covers the cost of each member’s C&EN subscription

B. 23% goes towards supporting local section, division, and student member activities

C. 2% provides partial funding to over $41.9 million in Society Programs activity, and

D. 33% goes towards supporting the cost of staffing and maintaining a member service center which includes member record maintenance, dues invoicing and receipts, and the technology costs and technology maintenance costs associated with these items. 

  1. How do the dues rates of other Societies compare to ACS?

ACS annually compares dues rates with 10 comparable organizations. Historically, ACS dues have been in the lower half of the comparison group.

Comparison of ACS with Other Scientific Societies – 2015

Membership Societies  Dues Number of Members
American Association for Clinical Chemistry $ 223 7,500
Association for Psychological Science 212 20,000
American Institute of Chemical Engineers 199 44,000
Royal Society of Chemistry 197 51,000
IEEE 186 374,000
American Physiological Society 170 10,500
American Nuclear Society 170 10,000
American Chemical Society 158 158,000
American Association for the Adv. of Science 155 137,000
American Physical Society 145 50,500
Society of Plastics Engineers 144 16,000
American Society for Biology and Molecular Biology 140 11,700
American Ceramics Society 120 7,500
  1. What membership dues categories does the ACS offer? 

The Society has four dues categories for regular, graduate student, undergraduate student, and non-scientist/Society affiliate. Please select ACS Membership for additional information.

  1. How have historical increases in the member dues rate compared to the rate of inflation?

The actual dues increases from 1986 through 2015 have not kept pace with inflation. The dues escalator model, put into place in 1986, was established to ensure dues are increased consistent with inflation. Over that period, there have been five years when dues were not increased at all or only increased partially in contrast to the full escalator calculation. This has caused a permanent lag in the pace of dues increases relative to inflation.

Year CPI-W4 (Services) Fully Indexed Dues (Rounded) Actual Dues
1986 1 5.02% $ 72 $ 72
1987 4.99% $ 76 $ 76
1988 4.30% $ 79 $ 79
1989 4.21% $ 82 $ 82
1990 2 4.86% $ 86 $ 82
1991 4.87% $ 90 $ 86
1992 5.47% $ 95 $ 91
1993 3 4.48% $ 99 $ 93
1994 3.47% $ 102 $ 96
1995 2 3.62% $ 106 $ 96
1996 3.05% $ 109 $ 99
1997 2 3.39% $ 113 $ 99
1998 3.28% $ 117 $ 102
1999 2.77% $ 120 $ 105
2000 2.41% $ 123 $ 108
2001 2 2.58% $ 126 $ 108
2002 3.90% $ 131 $ 112
2003 3.70% $ 136 $ 116
2004 3.27% $ 140 $ 120
2005 2.83% $ 144 $ 123
2006 2.94% $ 148 $ 127
2007 3.95% $ 154 $ 132
2008 3.23% $ 159 $ 136
2009 3.24% $ 164 $140
2010 3.23% $ 169 $145
2011 0.93% $ 171 $146
2012 1.11% $ 173 $148
2013 2.16% $ 177 $151
2014 2.17% $181 $154
2015 2.34% $185 $158

1 First year of the Dues Escalator
2 Years with no Dues Increase
3 Year with partial Dues Increase