Details on Net Assets Discrepancy

[Andrew Muehlfeld (Alpha - UIUC)]

In response to Alpha's first letter, Dr. Eisenstein agreed that our
total assets figure has been increasing, but that "it is the net
assets that has been decreasing." The net assets figure has not been
decreasing. In Alpha's second letter, we stated that a "brief
analysis of the tax filings still seems to indicate that HKN's usable
funds are increasing yearly." Here is the analysis to substantiate
our claim, based on publicly available tax filings from the past four
years.

Net Assets:
2003: $298,344
2004: $272,109
2005: $388,779
2006: $500,897

For those who haven't had ECON 101 in a few years, here is the quick
version. Net assets is how much money you have, all together.
Liabilities is the money you can't use because you have promised to
save it for something in particular. Net assets is total assets minus
liabilities, or the money you have that you can actually use.

In our case, most of our liabilities ($439,68 in 2006) relate to the
costs of fulfilling lifetime subscriptions to THE BRIDGE. To the
BoG's credit, they have made a wise choice in this aspect of finances
by eliminating lifetime subscriptions to THE BRIDGE and reducing the
subscription for initiates to two years. Because of that decision,
our liabilities will continue to decrease each year, as lifetime
subscriptions phase out. This analysis shows one more reason that
HKN's financial situation is improving, not nearing catastrophe.

What insults me the most is that when we caught the BoG in what seems
to be a lie, they responded with what seems to be another lie that we
could easily discredit with the same information we cited in our first
letter. Since then, the BoG has ignored our repeated requests for an
explanation. As time goes on, it seems less and less likely that
there is an explanation. If there were an explanation, it does not
make sense that the BoG would have withheld it this long.

- Andrew Muehlfeld
Alpha - UIUC

And the fine details, if you really want to see them:

2003:
Total Assets: 876,974.91
Liabilities: 578,630.53
Net Assets: 298,344.38

2004:
Total Assets: 997,962
Liabilities: 725,853
Net Assets: 272,109

2005:
Total Assets: 1,092,251
Liabilities: 703,472
Net Assets: 388,779

2006:
Total Assets: 1,180,990
Liabilities: 680,093
Net Assets: 500,897

[Laurie Miller (Omicron past president)]

So what's got me very curious, at this point, is the real reason the
BoG wants a merger. It may well be finances, but not the financial
explanation they have given.

So I'm more or less interested in 3 things:

- merger pros
- merger cons
- the real explanation for why the board wants a merger, which may or
may not have anything to do with pros and cons as the rest of us see
them

[Beta Chapter Advisor]

Two things jump out at me from the documentation associated with the
MoU and from personal communication with the BoG (via Kathy Ricker).

(1) The President of HKN gets a voting seat on the IEEE Educational
Activities Board *and* on the Board of the IEEE Foundation. These are
important positions and look really darn good on a resume.

(2) Apparently the entire BoG transfers into IEEE positions, remaining
as an advisory board to HKN. (A response I received indicated these
people would continue to administer the guidelines for membership,
etc., after the merger.)

Of note, from other communications, the present BoG comprises a number
of individuals who have been active in IEEE politics in the past.

I don't know that I'm doing too much of reading between the lines to
believe that the BoG members are strong IEEE supporters, strongly
believe that inclusion in IEEE is truly a good thing, but may just be
willing to loosely interpret reality to gain some nice resume lines.

Alternately, I could just be overly cynical.

-tmt



On Mar 4, 4:02 pm, "Laurie Miller (Omicron past president)"

[Andrew Muehlfeld (Alpha - UIUC)]

My primary concern continues to be the integrity of the Board of
Governors. Alpha has proven several statements in the FAQ to be
objectively, factually false. If the BoG will lie to us to generate
support for the proposed merger, how can we trust their motivations?
The BoG has ignored four requests to explain discrepancies between the
FAQ and tax filings, from myself and Alpha alone. After a meeting
tonight, Alphas has concluded that we are uninterested in discussing
the pros and cons of the merger until the BoG addresses the
discrepancies, and begins to regain trust. If your chapter did not
already share this position, we encourage you to join us. I have
exchanged several emails and a phone call with Kathy Ricker and
President Irwin himself. I have uploaded two of my letters, for those
who would like to read the details. These letters are my own, and not
Alpha's collectively.

http://groups.google.com/group/hknieeemerger/web/March3.Request.doc
http://groups.google.com/group/hknieeemerger/web/March5.Response.doc

[Darren Lo (Mu Chapter Corresponding Secretary Sp 2008)]

Thanks for sharing this Andrew. It is extremely troubling and
frustrating that they are ignoring your repeated, polite requests. If
we don't get real answers on Friday, we may have some very serious
action items on the agenda for our meeting between chapters.

-Darren

On Mar 5, 10:49 pm, "Andrew Muehlfeld (Alpha - UIUC)"

> http://groups.google.com/group/hknieeemerger/web/March3.Request.dochttp://groups.google.com/group/hknieeemerger/web/March5.Response.doc

[Darren Lo (Mu Chapter Corresponding Secretary Sp 2008)]

Thanks for sharing this, Andrew. It is frustrating and troubling that
they have repeatedly ignored your polite requests for critical basic
information. If we don't get real answers on Friday, then we may have
some very serious action items on our agenda at the meeting between

chapters.

-Darren

On Mar 5, 10:49 pm, "Andrew Muehlfeld (Alpha - UIUC)"
<amueh...@gmail.com> wrote:

> http://groups.google.com/group/hknieeemerger/web/March3.Request.dochttp://groups.google.com/group/hknieeemerger/web/March5.Response.doc