THE UKRAINIAN NATIONAL ASSOCIATION FORUM (06/15/03)

THE UKRAINIAN NATIONAL ASSOCIATION FORUM

Report of the Auditing Committee of the Ukrainian National Association

The Auditing Committee, in accordance with the UNA By-Laws, on May 28-30, 2003, conducted a review of the operations of the Ukrainian National Association for the 12 months of 2002. The previous audit was conducted on November 19-21, 2002. The Auditing Committee's plan of action consisted of reviewing the implementation of resolutions of the 35th Convention of the UNA, the activity of the financial and organizing departments, UNA publications, and the administrative and financial state of the UNA resort Soyuzivka, and other matters. As a result of its review, the Auditing Committee reports the following.

1. Resolutions of the 35th Convention of the UNA

The convention adopted a series of resolutions on which the Executive Committee is working. In its previous report the committee noted the resolutions already implemented. At present there is a series of resolutions whose implementation has been postponed due to concrete reasons. Future reports of the committee will note any changes in the status of these resolutions' implementation.

2. Financial Department of the UNA

For the 12 months of 2002, the UNA's operating losses totaled $834,000 in comparison with profit of $365,000 in 2001.

The UNA Corporate Headquarters became profitable by $274,000, a sum greater by $190,000 than in the previous year.

The drop in the value of the Canadian dollar and the value of market investments as of the end of 2002 caused a decrease in the UNA's reserves (surplus) of $258,000 and $438,000, respectively.

It is worth noting that during the first three months of 2003 the operating profit of the UNA totaled $90,000 and its reserves increased by $502,000.

The UNA's finances were reviewed for 2002 by independent public auditors. The report of their audit was not yet published at the time of our audit.

In addition, auditors of the State of New Jersey have been conducting a review of the UNA's activity over the past four years. This audit will last for several more weeks. The Auditing Committee later this year will review the results of both aforementioned audits.

The Auditing Committee informed the chairperson of the UNA Convention Committee in Chicago that his report on the finances of the 35th convention are not clear and complete. We await an answer.

The Auditing Committee reviewed a list of payments due for advertisements in our publications. It became evident that there are unpaid debts covering a period of one year or more and totaling $35,000. The committee recommends increasing efforts to collect these debts and to improve the systematic collection of payments due.

3. Organizing Department of the UNA

In accordance with statistical data, during 2002, 384 new policies for $7,972,000 of insurance were sold. Among these are 16 policies sold in Canada for the sum of $210,000. During the same period, however, the total number of active policies decreased by 2,237. In view of the beneficial interest rate, the UNA gained 64 annuities accounts for a sum of $1,493,000. As of the end of 2002, the UNA had 43,055 active policies for total insurance in force of $138,911,000.

Evaluating the work of individual districts and branch secretaries, we note that the Northern New Jersey District enrolled the highest number of members, that is 85, insured for a sum of $2,594,000. The chairman of this district is UNA Advisor Eugene Oscislawski. Second place was taken by the Philadelphia District, which enrolled 61 new members insured for a sum of $860,000. The chairman of the district is Advisor Stefan Hawrysz. Third place in the enrollment of new members was taken by the Albany District, which gained 41 new members insured for $1,000,000. The chairman of the district is Nicholas Fil.

Among secretaries, commendations and thanks are due to Lubov Streletsky, who enrolled 24 new members insured for $444,000 into Branch 10, thus earning first place. Second place was taken by Christine Brodyn, who enrolled 17 new members insured for $249,000, and third by Stefan Hawrysz, who enrolled 16 new members insured for $217,000.

In November of 2002, the UNA signed a contract with Western Catholic Union which will cooperate with us in the fields of sales and marketing of UNA insurance products, including direct mail advertising, holding of seminars and training of sales specialists.

4. UNA Publications: Svoboda and The Ukrainian Weekly

As of the end of 2002, the number of Svoboda subscribers was 6,766; The Ukrainian Weekly subscribers totaled 6,306. In comparison with the end of 2001, the number of Svoboda subscribers decreased by 387, while the number of Weekly subscribers declined by 298.

The deficit of both publications for 2002 was $252,000. For purposes of comparison, let us recall for 2001 it totaled $144,000. The reason for the larger deficit is the decrease in the number of subscribers and advertisers of both papers. In accordance with the budget for 2002, the deficit of both publications should not exceed $125,000.

5. Soyuzivka

During 2002, losses related to Soyuzivka's activity totaled $720,000. In 2001 losses were $66,000 less. Despite the fact that expenses decreased by $64,600, income was less by $130,000.

The 35th Convention established a committee to improve Soyuzivka. The goal of the committee is to halt the need for cash allocations to the UNA resort and at the same time keep the resort in Ukrainian hands, if possible. The Executive Committee was directed to support the activity of the Soyuzivka committee for one year with appropriate funding.

The Executive Committee constantly informs the Soyuzivka committee about its work relating to Soyuzivka. Nonetheless, to date it has not received any directives from the Soyuzivka committee.

The Executive Committee has implemented certain improvements at Soyuzivka, including personnel changes. They also invited a group of specialists to work with the UNA, and they continue to work with these specialists on further improvements and changes for the benefit of clients and Soyuzivka. It should be noted that these specialists are working pro bono.

The Executive Committee sent a strategic business plan for the 2003-2005 period to the insurance authorities of the State of New Jersey. This plan details projections not only for the UNA as a whole, but for its various operations, including Soyuzivka. The plan will be discussed at a meeting with state officials in June.

The Executive Committee is endeavoring to persuade state officials that the existence of Soyuzivka is tightly interwoven with the future of the UNA and that the proposed plans for Soyuzivka will make it less deficit-producing.

6. Miscellaneous

The audit did not reveal any claims or lawsuits against the UNA.

For the Auditing Committee:

Dr. Zenon Holubec, chairman
Yaroslav Zaviysky, vice-chairman
Dr. Alexander Serafyn, secretary

(Translated by The Ukrainian Weekly)

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