MPLT realized a strong financial improvement in FY 2007 as total assets have risen by $8.4M, or a 12.2% growth over the previous year. Liabilities also increased during the same period by $1.8M. Of the total FY07 liabilities of $2,270,285, $2,228,048 represents MPLT transfers out to the General Fund as required by Article XI of the CNMI Constitution. Revenues also increased to $8.4M while expenses continue to decline. This is according to an independent audit conducted by the CPA firm, Deloitte.

Total Assets rise by $8.4M

MPLT’s overall financial condition substantially improved in Fiscal Year 2007. The change was marked by increased investments, increased income, and decreased operating expenses. These changes further caused total assets to increase. Total assets increased 12.2% or $8.4M from $68.6M in FY06 to $77.0M in FY07. For the General Fund, assets increased $7.8M while the American Memorial Park Fund increased $517K over the prior year. Other factors causing assets to increase include large increases of cash and cash equivalents, $2.6M; accrued income, $1.9M; and security investments which increased $5.4M.

Total Liabilities increase by $1.8M

Total liabilities in FY07 were $2.270M, up from $450K in FY06. Of the total FY07 liabilities, $2.228M represents MPLT transfers out to the CNMI General Fund as required by Article XI of the CNMI Constitution. The transfer to the General Fund was made in October 2007, after the close of the fiscal year. MPLT has created three local economically targeted investments (ETI). These investments aim to provide corollary benefits while simultaneously providing

MPLT a required rate of return. For the General Fund, two such ETIs are the loan to NMHC and Adelantun Publickun Luta Enteramente, Inc. or APLE. The third ETI is for the maintenance and development of the Park Fund. MPLT has
suspended any new ETI’s until legal matters with APLE have been settled.

Revenues increase to $8.4M while expenses continue to decline

Total operating revenues increased 52.7% from $5.5M in FY06 to $8.4M in FY07. The increase in revenue is attributed to the $2.2M rise in the fair value of investments and $700K increase in interest income. Operating expenses decreased by $240K or 27% from $890K in FY06 to $650K in FY07. Professional fees, money management administration, salaries and benefits, contract services, and trustees’ expenses all contributed to the decrease in expenses. Expenses increased in other areas; however, they were not significant. Consultancy fees increased by $13K; office supplies by $2K; and rent and utilities by $3K. Since FY03, operating revenues were highest in FY07 at $8.4M and lowest in FY06 at $5.5M. Expenses have gradually decreased over the 5 year period, but it peaked in FY03 at $1.1M with FY07 being its lowest at $650K.

Fixed Income Securities grow while Equities fall in total

MPLT employs the services of professional money managers to manage the assets of both the General and Park Fund trusts. The allocation of these securities may change over time due to changes in investment policy decisions. These securities consist of equities, fixed income securities, and economically targeted investments (ETI). MPLT changed its investment policy in FY06 requiring that more securities be placed in fixed income rather than in equities to provide for a steady stream of cash flow to the CNMI General Fund. For FY07, equities total $26.0M, down 1.66% from $26.4M in FY06 while fixed income securities gained $5.8M or 18.7% from $31.1M in FY06 to $36.9M in FY07. MPLT has 41% invested in equities and 59% invested in fixed income securities for FY07.

OPA commends MPLT’s Trustees for the financial improvements realized in FY07, and the strengthening of MPLT’s financial condition.

Download/view full Executive Summary of MPLT Audited Financial Statements 2007

(A copy of the full audit report may be obtained at OPA or MPLT.)