To members of the AIA,

Our new financial year is off to a healthy start with encouraging news. Our solid performance last year has been confirmed by the 2001 financial audit. We have received confirmation of the dissolution of AEC, and, finally, our continuing commitment to operating in a disciplined and businesslike manner is demonstrated by the fact that we are ahead of budgeted targets for the first quarter of 2002.

We have received an unqualified audit opinion for 2001 from our auditing firm, Pricewaterhouse-Coopers. Net income and total net assets for 2001 exceeded our plan. The completed audit confirms that total net assets improved by $3.1 million and now stand at a positive $1.66 million. This resulted from three factors:

1. AEC’s total lifetime cost to the AIA was far less than expected
2. Income from the extension of the magazine contract with McGraw-Hill
3. The 2001 operating budget provided a positive contribution to assets of $1.4 million, exceeding the budgeted goal.

This is the second year in a row during which The American Institute of Architect’s operating revenues have exceeded expenses.

AEC officially dissolved
The Delaware Secretary of State has confirmed the corporate dissolution of Architects-Engineers-Contractors, Inc. (AEC), effective January 30, 2002. As a result, AEC’s corporate life has officially ended.

First quarter ahead of plan
Our balanced budget goal continues into the first quarter of 2002. Operating expenses for the first quarter of 2002 are down. Combined with a slightly higher-than-planned first quarter revenue, our operating net income is higher than budgeted as of the end of March. Overall, our first-quarter net income exceeds our plan by 6.8 percent.

Going forward
We are progressing toward member-service excellence and feel confident that the growing financial health of the AIA means even better professional services for our 70,000 members. We have operated with balanced budgets and achieved surpluses for the last two years. We intend to make 2002 the third year in a continuum of fiscal stability and asset growth.

I welcome your comments,

Norman L. Koonce, FAIA
Executive Vice President/CEO

Copyright 2002 The American Institute of Architects. All rights reserved.