2022-23 Harvard Club of Boston Annual Report

THE HARVARD CLUB OF BOSTON

2022-23 ANNUAL REPORT

Be a part of the Harvard community for a lifetime. Every day is a class reunion at the Harvard Club of Boston.

Board of Governors 2022-2023

PRESIDENT

Marcus O.P. DeFlorimonte, gb’95, pmd

VICE PRESIDENTS

Susan Kendall ’81, ks’99

Jillian Campbell McGrath, Legacy

SECRETARY

Edward Matson Sibble, Jr. ’73

TREASURER

Michael F. Cronin ’75, gb’77

HOUSE COMMITTEE CHAIR

Juan Carmona, g’10, ph’10, ph’14, m’16

DIRECTORS

Anthony Consigli ’89

Charles F. Cornish, Legacy

Andy Freed ’90, ks’94

Michael Gaines, gb’96

Martin J. Grasso, Jr. ’78

Bernard Ho, MIT’06

Courtney Jacobovits, gsd’16, MIT’22

Philip Lovejoy, Legacy

Elizabeth A. Micci, ged’18

Amy Norton, dv’16

David Rodriguez, YG’12

Jan Saragoni, ks’89

President's Report April 2023

What a difference a year makes. Last year at this time, given the challenges and uncertainty of the previous three years, none of us was at all sure of what the future foretold. We were hopeful but cautious in our optimism. I’m happy to report that hope springs eternal and the state of our beloved Harvard Club of Boston is solid. The feel of our Club community is one of renewed excitement as we fulfill our mission to be the social, intellectual and athletic hub of Harvard alumni and affiliated communities in the Greater Boston area.

As my first year as President of the Harvard Club of Boston concludes, I am humbled and honored to be your President. It’s been a good year for us as we welcomed new members and reconnected with those who returned after the pandemic. I appreciate the conversations with you, our members. You care about our club and your willingness to engage on many levels is fundamental to our success.

The Harvard Club of Boston exists because of Harvard University Over the past year, we strategically embraced Harvard and strengthened our partnership with the University on many levels We will continue prioritize connecting to the Harvard Alumni Association in everything we do This will make us relevant in the lives of our current members and attract future ones.

The details of our accomplishments over the past year are outlined in the committee reports of the Annual Report. Below are some highlights.

Our financial position is strong, and we have been fortunate to recover from the pandemic.We have our HCB management team along with members that continued to support our club during the pandemic, returning members and new members to thank for our fiscal recovery. We must keep our focus on retaining and attracting members for continued financial stability. Our member experience significantly improved over the past year. The variety and depth of our member events allowed all to enjoy the intergenerational and multi-disciplinary quality of our HCB community. As we moved forward, the Member Experience Committee will focus on the member journey, member interaction, member events and our Harvard connection as key factors to enhance the value proposition of membership.

We continue follow the lead of the University regarding making our clubhouse and representations more inviting and welcoming to all in the Harvard community One way to do this through artwork Thanks to your contributions, the Higginson Foundation, has supported adding pieces to our collection that embodies the rich diversity and inclusion of today’s Harvard.

Whether through Veritas, our member events and signature holiday celebrations, cooking classes or mixology and tastings, our culinary team continues to shine.

We are blessed to have a dedicated facilities team that takes much pride maintaining our 110 year old clubhouse That said, our roof system will require major work over the next year or so The good news is that the bathrooms on the second floor of the clubhouse are now ADA compliant The Facilities Renewal Assessment helps pay for the cost of those of repairs and upgrades, along with other similar projects that keep our building operating and maintained in good order.

This year we worked with a branding, design and production company to a create a comprehensive marketing strategy for the HCB. This work has provided a foundation for how our club portrays itself in all aspects of communication and design. Essential to our success as an alumni club is our ability to honor traditions, acknowledge the present and embrace the future.

The Harvard Club of Boston has again named a Platinum Club of America. We were awarded the distinction as the 9th ranked City Club in the United States. We congratulate Steve Cummings, our General Manager and his team for this achievement.

The 415 Newbury Street Project continues to move through the City of Boston permitting process. There have been some preliminary approvals, however there are many more required. At this point given the number of agencies, new regulations and delays in scheduling, we do not anticipate that construction will begin before the 2nd half of 2024. Please note that even when the project receives all the required governmental approvals and permits, the Board of Governors (BOG) intends to review the terms of the development deal and make a final decision whether to move forward with project after receiving a recommendation from the Steering Committee. The Steering Committee, which is closely monitoring the project, consists of our four recent past presidents, the Executive Committee of the BOG, our General Manager and a real estate consultant.

The HCB staff continue to be an important component in the life of our club.Steve Cummings, our General Manager and recognized leader in the private club industry, is now in his 11th year of award winning management of the HCB team. We have been fortunate to have the expertise of seasoned staff along with an influx of new hires with the fresh perspectives over the past year. This combination has proven to be a wonderful model for providing a quality service for our members. Thank you to our staff for your dedicated service. We appreciate everything they do on our behalf.

Devoted, measured, earnest, thoughtful – those are some of the words I use to describe my fellow members of the Board of Governors. They engage with purpose, provide forthright oversight and supportive guidance to management. They are committed stewards of our Club and I am grateful for their time, talents and service The board service of Bernard Ho and Philip Lovejoy ends after this year’s annual meeting Bernard has been a stalwart regarding working to incorporate data in our work at the club

Philip has been a leader in articulating some hard truths about our relationship with Harvard. Because of his advocacy, our club is now committed to embracing and connecting in new ways with the University, and the HCB will be better for it Thank you, Bernard and Philip, your contributions have served us well and we are greatly appreciative

Committee service is one the best ways to be involved in our club community.Thank you to our members who serve on our committees. Your input has helped to influence the experiences for all of our members and guests.Thanks also to our Special Interest Groups which provide an avenue for members to enjoy the fellowship of the those with similar interests. Collectively your involvement makes our club better.

In closing, I would like to thank the members who stepped forward to make suggestions or offer encouragement to us in the past year. When members ask what they can to assist the club, one thing always come to mind. Spread the word, talk to fellow alumni and friends about becoming members and invite them to do so. The most important asset of the HCB are its members. We are strengthened by the richness shared individually and collectively through inclusion, connectivity and engagement throughout Harvard, affiliated schools and neighboring communities. Many thanks to all of you for choosing to be members of our beloved Club. Your loyalty and support make us thrive as a community, onward together.

Respectfully submitted,

Marcus O. P. DeFlorimonte, gb’95 pmd President

Secretary's Report

The Secretary regrets to announce that since the last annual report, the following Members have died:

Esther D. Ames, assoc.

W. Gerald Austen, MIT’51, m’55**

Cameron D. Beers, Jr., gb’57**

Gordon R. Bennett, Jr., gb’59

Robert T. Brooks ’68, gb’73

Paul R. Corcoran, Jr. ’54 **

Michael M. Davis, Y’65**

Carlo J. DeLuca, HMS Faculty

Richard H Fitton, Jr ‘51**

Joseph M Gately ’54**

M Patricia Hagan, assoc

William D. Howells ‘54

John W. Humphrey, gb’64**

Susan D. Lawlor, ged’01

Ralph Lowell, Jr., ‘45**

Bruce MacDonald ‘57

Stephen A. Mandell ’54, gb’57**

Douglas E. McCaleb, dv’87

Donald McKay ‘55**

Respectfully Submitted, Edward Matson Sibble, Jr., ’73

Secretary

Anthony J Medaglia, Jr ‘59**

Martin C Mihm, Jr **

Anthony P Monaco, m’56**

Donald S. Pierce ’52, m’57**

Richard B. Plank, gb’57**

Wellington Friend Scott, III ’49, l’52, dv’67

Edna M. Sears, assoc.

Nancy Shapira, assoc.

Robert G. Shaw ‘61**

Stanley W. Snider ‘48**

Donald R. Sohn, gb’51**

Sidney Topol, ks’89

Dorothy-Lee Jones Ward ‘50**

William B. Warner ’52, gb’56**

Suzanne Washburn, assoc.**

Robert K. Watson ‘55**

James O’ Welch, Jr ‘52**

**Denotes a 50+ year Club Member

Treasurer's Report

In fiscal year 2022 the Harvard Club of Boston strongly recovered from the effects of Covid-19. Fortunately, membership slightly increase by 166 net new members with returning and new members balancing our historical attrition.

Our management team continues to do an extraordinary job. In perspective in fiscal year 2022 revenues totaled $14,207,494 up 78% from $7,971,131 in fiscal year 2021. Improvements occurred in all areas. Membership dues increased $162,475 or 2.7%. Food and beverage revenues increased $4,835,746 or 441%. Room revenues increased $960,237 or 343%, Parking revenues increased $228,825 or 84% and athletics revenues increased $68,020 or 33%. Consequently, operating income before fixed expenses and income taxes increased $1,377,198 or 403%. Fixed expenses decreased by $519,160 of which $257,659 was lower depreciation expenses. Taxes also decreased by $1,010. Entrance fees increased $247,554 or 95% During the year, our PPP loan of $1,901,225 was forgiven and we received an additional $124,061 to the $1,626,340 received in fiscal year 2021 in employee retention credits Overall, the change in net assets before pension related charges was $2,408,400 compared to a loss of $135,468 in fiscal year 2021

We began the year with $3,808,589 in cash and ended the year with $4,667,305 without utilizing our line of credit. With sensible cost controls, working capital management, and limited capital expenditures the Club hopes to end fiscal year 2023 with a positive cash balance again without utilizing our line of credit. Long term debt used to fund prior renovations totaled $8,055,273 compared to $8,611,925 in 2021.

Our pension fund has an underfunded position of $4,466,482 due to changes in actuarial assumptions regarding the present value of plan benefits, portfolio performance and contributions. This year the pension fund value decreased $1,638,746 to $7,860,404 with depressed market performance. The benefit obligation also increased $2,540,559 to $12,326,886. Consequently, the net Retirement Obligation increased to a negative $4,466.482 in 2022 from a negative $287,177 in 2021. The effect of this is seen in the audited financial statements which show pension related changes other than net periodic pension cost of $4,506,758 compared to a gain of $558,660 in 2021. This year the financial markets experienced a major reversal, and our fund was down 17 25% on a net basis Moreover, the pension committee in discussions with its consultant also decided to significantly revise the assumptions for calculating the liability and this resulted in reducing our discount rate from 7% to 4 45% and our expected rate of return from 7.5% to 6.0% (the fund’s 28-year historical weighted average annual compound return is 6.1%). The combination of the change in assumptions and market losses resulted in this significant increase in our unfunded position.

Both the retirement plans for union employees and all other employees have ceased benefits accruals

We still make payments into the pension plan to make up for actuarial deficits and we have additional costs for a 401K Plan the Club instituted to mitigate the changes in the pension plans. During 2022 and 2021 there were approximately $166,000 and $142,000 in employer matching contributions, respectively.

Fiscal year 2022 was a comeback year for our Club which we hope will continue in fiscal year 2023. Our management team has been instrumental in managing cash, controlling expenses, and maintaining the financial integrity of our Club while restoring the traditional programs and activities at the Club. Finally, this was a year of an important transition as we welcome our new CFO, Sara LaWare who succeeds Michael Jenkins who retired after fifteen years of tremendous service to our Club.

Respectfully Submitted,

Michael F. Cronin ’75, gb’77 Treasurer

House Committee

Dr. Juan J. Carmona, g’10, ph’10, m’16, Chair

Anthony M. Consigli, ’89; Charles F. Cornish, Legacy; Victoria Cornish; Colin Hendrickson; Courtney L. Jacobovits, gsd’16, MIT’22

Jillian C. McGrath, Legacy; John I. Meyer, gsd’77; Peri Onipede David Rodriguez, YG’12; Edward M. Sibble, ’73; Isaac Silberberg, MIT’16 Dr. John Tamilio; Christine Tuttle

Introduction

With the utmost pleasure, I humbly submit this House Committee Report, in preparation for our 2023 Annual Meeting. The tireless efforts of our Committee are dedicated to advancing the Harvard Club of Boston's world-class facilities, culinary offerings, athletic amenities, selection of reciprocal club peers, and fine arts initiatives all integral to a thriving, member-centric community experience

To this end, I express my sincerest gratitude to each Sub-Committee head and our invaluable collaborating staff members. Additionally, I provide a succinct yet comprehensive summary of noteworthy accomplishments and ongoing initiatives, which I am privileged to share with our esteemed membership.

Sub-Committees

Athletics: We are thrilled to announce that, under the exceptional leadership of Jillian McGrath, in collaboration with Athletic Department Manager Valerie Phillips and Squash Professional Sharon Bradey, our fitness and squash program continues to thrive. With over sixteen virtual classes and consistently high attendance, our Club offers a highly successful virtual fitness program that sets us apart from our peers. As COVID-19 restrictions are now lifted, we are excited to revitalize our squash program. Our Club Championships have returned, and we are excited to introduce pickleball as a new offering. Ms. McGrath has prepared a comprehensive report that outlines these and other significant accomplishments, which we are delighted to share with our members

Facilities: Glen Ballard has played an instrumental role in the restoration of our Member Workspace, which sustained damages during the June 2022 flood, and has successfully brought it back to better than its original condition. Furthermore, he has contributed to the Club's sustainability efforts by installing a water bottle refilling station in the 3rd floor Member Lounge, leading to a significant reduction in our reliance on bottled water. The Member Commons space has been thriving as a strategic amenity for our members looking for a comfortable space to unwind.

It caters to a diverse range of needs with its dedicated workspace, lounge area with complimentary beverages and snacks, and a conference room that can be reserved for up to 90 minutes for private meetings. Our generous 22-seat Committee Room, equipped with best-in-class hybrid connectivity and comfortable seating, serves as the perfect venue for Club Committees and Board meetings.

We have also undertaken several renovation projects, including the redesign and reconstruction of the second-floor bathrooms to ensure they are ADA compliant. The brick repointing work is almost complete, and the first phase of the roof replacement project is set to begin soon The front patio project is currently awaiting permitting, and we hope to receive approval by the fall Our team is eager to receive feedback from designers to improve the Front Entrance, Foyer, ClubPub, and Massachusetts and Aesculapian Rooms. Last summer, we updated the bathrooms in the three prior-pending hotel rooms, completing all 25 rooms with new bathroom finishes, lighting, plumbing, and fixtures. We are planning to upgrade the HVAC system for the overnight rooms, and LC Anderson will be suggesting a new chiller unit.

Fine Arts: Peri Onipede has demonstrated exceptional leadership in leading a highly collaborative team that remains dedicated to connecting our Club's spaces, walls, and history. In particular, the team has focused on transforming the walls of the Massachusetts Room to better represent our current Club and the Harvard community. Phase One of the project, which involved replacing the prior artwork on the walls of the Massachusetts Room with portraits of distinguished Harvard figures such as Dr. Alice Hamilton, Dr. Evelyn Hammonds, and Dr. Paul Farmer, has been successfully completed. The team is now moving onto Phase Two, which includes updating and renovating the Massachusetts Room itself, with plans to improve the floor, windows, ceiling, walls, lighting, and HVAC. The Fine Arts Committee will continue to work closely with the House Committee, and we are grateful for the diligent efforts of Peri Onipede and the Fine Arts team in bringing many significant enhancements to fruition already

Food & Beverage: Dr John Tamilio has shared that the Food & Beverage Sub-Committee's participation remains robust, and the team has recently welcomed two members to offer fresh perspectives. Dr. Tamilio frequently updated the House on various culinary activities, ranging from insights on the most recent Cocktail 374 event to cooking classes and member feedback regarding their experiences at Veritas. This Sub-Committee reviews all seasonal menu changes, including those requested or recommended by Sub-Committee members, as well as those triaged by management in response to data from the Happometer tool. The Club's overall hospitality goal is to provide an enjoyable and holistic culinary experience in Veritas and our other dining spaces. To achieve this, elements such as comfortable room temperature, appropriate background music volume, and nuanced ambient lighting are crucial components that complement the food and dining experience, much like an excellent wine pairing. At the heart of our food and beverage experience is our best-in-class staff, who always offer a warm greeting and exceptional professional service to match our Club's world-class cuisine.

Reciprocal Clubs: Reciprocal club usage increased last year as travel picked up. Mat Sibble has admirably led this Sub-committee in adding several new clubs to our reciprocal network, both domestically and internationally. The Sub-committee continues to monitor current clubs and evaluate their potential against our industry-leading standards of inclusiveness and accessibility. We appreciate the Sub-committee's excellent work in expanding our exceptional reciprocal network, with a focus on underrepresented locations, both domestic and international. We always welcome comments and suggestions from members regarding their experiences with reciprocal clubs and suggestions for new ones. Mr. Sibble has submitted a comprehensive report that details the Subcommittee's latest successes.

Conclusion

I extend my deepest and sincerest gratitude to all the individuals featured in this House Committee Report, along with their respective Sub-Committee teams. Through their tireless efforts, we have accomplished so much and remain poised for even greater achievements

I would like to offer a special token of gratitude to General Manager Steve Cummings, whose unwavering support, decisive leadership, and exemplary resilience during the past year continues to inspire us all. Thanks to his steadfast commitment and the unwavering dedication of our staff, we have emerged as a stronger and more vibrant Club community.

It is an honor to serve alongside such dedicated colleagues, and I am grateful for all that you do. Let us continue to uphold the high standards of our Club and serve our members with the utmost care and professionalism.

Respectfully submitted,

Dr. Juan J. Carmona, g‘10, ph’10, m’16 Chair

Audit Committee

Daniel J. Murphy III, ’63, l’66, Chair

Paul J. Brennan ’67 Larry Cheng ’96 Charles Frick Cornish, Legacy, CPA

Michael F. Cronin ’75, gb’77 Richard Hart Harrington ’58, CPA Thomas Kent ’75, CPA Daniel J. Murphy III, ’63, l’66,

After the close of the Club’s 2021 fiscal year, the Audit Committee reviewed the financial reporting process, internal controls and the 2021 financial reports of the Harvard Club of Boston (“the Club”), the Harvard Club of Boston Retirement Plan for Employees (“the Retirement Plan”), the Harvard Club of Boston Foundation (“the Club Foundation”) and the Higginson 1908 Foundation (‘the Higginson Foundation”).The financial reports of the Club, the Retirement Plan, the Club Foundation and the Higginson Foundation were prepared by each entity’s management, and PKF, the independent public accounting firm serving as each such entity’s external certified public accountants, audited the financial reports of the Club and the Retirement Plan and compiled the financial reports of the Club Foundation and the Higginson Foundation. All of the 2021 audits and compilations were completed in an efficient and timely manner, and no material weaknesses in the internal controls over the financial reporting processes have been identified by PKF. The Audit Committee has continued to review and evaluate the various mitigation and funding strategies of the Club during the ongoing COVID pandemic. The Audit Committee also appointed PKF to serve as the external certified public accountants of the Club, the Retirement Plan, the Club Foundation and the Higginson Foundation for fiscal year 2022.

Daniel J. Murphy III, ’63, l’66 Chair

Athletic Committee

Jillian Campbell McGrath, Legacy, Chair

Nicholas Brewer Rebecca Brownell John Cornish,

Nicholas

Legacy

Coskren ’09 Kevin Sullivan Jack Wain

I hope this annual report finds you and your loved ones doing well and staying healthy. We are relieved to feel some normalcy return to athletics this past year, as the COVID-related restrictions abated, and members began returning to the Club. As always, we keep the safety of our staff and members as our top priority.

After two years of keeping athletic dues steady, dues increased by 5% for fiscal year 2022. As is typical, this increase mirrored the 5% increase in dues at the Club level We felt this increase was important to keep up with quickly rising costs due to post-COVID inflation In addition, COVID-related restrictions, which had been hindering the user experience in athletics, were lifted

We continued to invest in our very successful virtual fitness programs. We will soon have sixteen virtual classes and member attendance has averaged between 20 and 30 individuals per class. We are excited to add more family-friendly programming, including a “Baby and Me” yoga class. If you have not tried one of these classes, I encourage you to do so.

We are thrilled to see more members joining athletics since COVID restrictions were lifted. Our squash program is beginning to recover. Our box league continued to see success with new and veteran squash players alike participating. Box league is a great way to play competitive matches and meet fellow members. Boxes are held monthly, and you can see Sharon Bradey to sign up. Junior clinics resumed on Saturday mornings, and we look forward to watching the next generation of club squash players learn the game.

We brought back Club Championships this year, resulting in many exciting squash matches! We congratulate the winners of each draw for their success and look forward to celebrating them at our upcoming Closing Ceremony We had an exciting Robert Banker Cup finals with William Weiter and Alex Wu defeating Bryan Ciborowski and Patricia Wada. Congratulations William and Alex!

We are excited to offer a pickle ball option to our members. Pickle Ball is available for play on our upstairs doubles court. You can find the net and equipment ready to use next to the court. This is one way we continue to evolve in order to meet the needs and desires of members.

None of this would have been possible without the dedication and hard work of Valerie Phillips, our Athletic Department Manager, and Sharon Bradey, our Head Squash Professional. Valerie and Sharon celebrated their 32nd and 22nd years of services to the club, respectively. This year brought both challenges and opportunities and we would not have been able to navigate these without their continued dedication and support. Thank you, Valerie and Sharon!

While we continue to be diligent in ensuring the health and safety of our staff and members, we are happy to provide greater flexibility in membership experience. Thank you again to the members that have stayed with us through the COVID-19 disruption. For those who took a leave of absence, we look forward to seeing you back in athletics this Fall.

Respectfully submitted,

Jillian McGrath, Legacy Chair

Budget & Finance Committee

Susan Kendall ’81, ks’99, Chair Michael Cronin '75, gb'77 Vice Chair

Marcus DeFlorimonte gb'95, pmd Chip Flowers ks ’06 Michael Gaines gb’96

Cheryl LaMonica, gb’20, gmp Debbie Millin, gb’22, amp

The Budget and Finance Committee is pleased to submit this report. After several years of pandemicrelated disruption, activities at the Harvard Club of Boston significantly expanded during fiscal 2022 resulting in an improved financial position. This year the Committee welcomed a new member, Debbie Millin, and also thanked Jack Wolfe for his commitment and dedication to the Club on the completion of multiple terms of service on the Committee. After meeting frequently during the pandemic, in the past year the Budget and Finance Committee was able to resume its typical quarterly meeting schedule to monitor financial performance The Committee recognized the many accomplishments of Michael Jenkins, who retired as Chief Financial Officer in June 2022 We welcome the Club’s new CFO Sara LaWare, who arrived in August 2022. We look forward to collaborating with Ms. LaWare and her staff for many years.

Our report includes a summary of fiscal 2022 financial performance and year-to-date fiscal 2023 financial results relative to budget.

Fiscal Year 2022 (September 1st, 2021 through August 31st, 2022)

Anticipating a prolonged period of reduced activity, and possible additional temporary Covid-related closures, the Club maintained a conservative approach to budgeting for a second year and anticipated another operating loss. However, activity ramped up ahead of projections as the Club welcomed its members and function clients back to the clubhouse. Membership levels, entrance fees and dues all showed modest improvement and we remain grateful to our members for their commitment through the pandemic. Although total revenue did not rebound to pre-pandemic levels, the Club’s operating results impressively exceeded the original budget to produce a small operating profit for the fiscal year However, after recording two one-time non-operating transactions the financial statements show a $2 million loss in net assets First, as expected, the federal government forgave the pandemic-related Paycheck Protection Program loan ($1.9 million), however this was more than offset by a significant ($4.5 million) adjustment in actuarial and financial assumptions for the Club’s pension. The Club maintains a comfortable cash position with good liquidity to support operations. The Club did not access its line of credit with Eastern Bank or take on any additional short or long-term debt.

Fiscal YTD 2023 (September 1st, 2022 through February 28th, 2023)

In April, 2022 the Committee began the budget process for fiscal 2023, with a cautious but with a more optimistic outlook than the previous year. Mr. Jenkins and Mr. Cummings worked with the Committee to incorporate continuing improvement in Club activity while still maintaining a conservative approach to revenue and expense projections. Budget assumptions were adjusted to reflect a moderate increase in member dues and modest growth in membership levels. The budget was revised several times and on June 15, 2022 the Committee approved the Fiscal 2023 budget, which projected break-even operating results. The Committee unanimously recommended the budget to the Board of Governors, who approved it at their meeting on June 21, 2022. Financial results through February 28, 2023 (6 months) indicate strong performance of revenues, exceeding those from the same date last year, continuing the Club’s growth trends in both member and function activity. Membership levels are projected to continue improvement as we all benefit from the tireless work of the Club’s Membership Experience Team to enhance the value proposition for current and prospective members. Budget and Finance Committee initiatives for the upcoming year include enhanced reporting on key performance indicators (KPIs) and long-range planning. The Committee expresses its appreciation to Mr. Cummings, Ms. LaWare and the entire staff for their careful management of the Club’s finances.

In addition to lingering financial stress related to the Covid-19 crisis, the Club faces two major strategic challenges which will impact the Club’s financial health: 1. Membership growth and 2. Improvements and redevelopment of our property at 415 Newbury Street. The Budget and Finance Committee is grateful for the spirit of cooperation and open communication among the Board, Management and committee leaders and members.

We invite our fellow club members to provide input and feedback at any time during the year. Many thanks to all Budget & Finance committee members for contributing their considerable expertise and strategic thinking as we strive to deliver the highest possible value to our members while maintaining robust long-term financial health for the Club.

Respectfully submitted,

Susan L. Kendall, ’81, ks ‘99 Chair

Harvard Club of Boston Foundation

Paul J. Brennan ‘67 Chairman

Michael F. Cronin ’75, gb’77Matthew G. Hegarty ’82 Ameek Ponda ’89, l’92 John P. Reardon, Jr. ’60

This Foundation was formed in 1950 with the following purpose:

“The purposes of this Trust are to foster scientific, literary, and educational interests among the members of the Harvard Club of Boston and to advance the interests and promote the welfare of Harvard University.”

The assets of the Foundation are invested in the Harvard endowment and showed a net decrease from $14,945,660 as of June 30,2021 to $14,076,874 as of June 30, 2022

The Foundation’s principal programs continue to be:

Harvard Club of Boston scholarships providing a portion of the annual financial aid for 144 Harvard College students from the Greater Boston area. These awards totaled $517,322 in the year ended June 30, 2022.

Prize Book program awarding 318 Prize Books and hosting the annual Breakfast honoring Prize Book winners and teachers, and leaders in education.

Summer Community Service fellowships for students volunteering at Boston non-profit organizations.

The Foundation works in cooperation with the Higginson 1908 Foundation in funding these programs. The Higginson Foundation is an independent 501(c)3 organization formed in 2017. All new fundraising from Club members is now being solicited on behalf of the Higginson Foundation. A report from its trustees appears elsewhere in this Annual Report.

We thank our Club members for their past contributions to the Foundation which enable us to continue to support these important programs We also thank our Club staff for all of the time they devote to the Foundation’s programs and their efforts to make all of them successful

Respectfully Submitted,

Paul J. Brennan ’67 Chair

Higginson 1908 Foundation, Inc

Michael H. Shanahan gb’82, President & Trustee

Philip C. Haughey ’57 Matthew G. Hegarty ’82

Nicholas J. Iselin ’87 gsd ’92, and Karen VanWinkle ’80 Trustees

Michael F. Cronin ’75, gb’77, Treasurer

The Higginson Foundation was established by a group of past presidents of the Club to provide for a more flexible and extensive charitable entity that can pursue a broader charter than the old Club foundation.In keeping with IRS regulations, this new Foundation is managed independently of the Club’s Board of Governors which adds flexibility in the range of activities for the entity.

The Higginson Foundation is an IRS approved 401(c)3 charity that can accept tax deductible gifts The charter of the new Foundation established these priorities:

The Foundation was organized as a Massachusetts nonprofit corporation on November 23, 2015 to preserve and protect old and historic buildings in and around Boston, Massachusetts, including, specifically the Clubhouse of the Harvard Club of Boston (sometimes referred to as “the Club”), as well as to preserve and protect historically significant artwork exhibited in and around Boston, Massachusetts, including within the Clubhouse of the Club, in order to perpetuate the further education of posterity with regard to the architectural, historic, artistic and general cultural heritage of the Boston area. The Foundation was further organized to encourage education and personal advancement for youth in the Greater Boston area, to foster scientific, literary and educational interests among members of the Club and to advance the interests and promote the welfare of Harvard University. The Foundation intends to carry out its educational purposes by, among other activities, organizing a speaker series to educate members of the Harvard Club of Boston and the Harvard University community on matters of public interest and by awarding scholarships and fellowships for study at institutions of higher education.

Our principal source of fundraising has been a voluntary member assessment We appreciate the members who contributed to the Foundation in this fashion – we were able to raise more than $150,000 last year through your generosity This year’s voluntary assessment will be included on the Club’s April statements and we hope you will continue to support the Foundation.

Along with the Harvard Club of Boston Foundation we continued our support of Harvard scholarships, summer fellowships, and the Harvard Book Prize. As we did in 2021, Foundation made efforts to enhance the diversity and inclusiveness of the Club’s art collection by commissioning framed reproductions of portraits of notable Harvard graduates or faculty.

This year we cooperated with the Club’s Fine Art’s Committee in acquiring several reproductions to help broaden the representation of the Harvard community in the Massachusetts Room There are now several portraits of “firsts” from Harvard’s history on display in that room, including the first woman faculty member at Harvard, the first black faculty member, and a handful of others interesting subjects. We have also worked with the Club to provide profiles of each piece of art in that room which are accessible to members and visitors by simply snapping a photo of individual QR codes located next to each work. Please give it a try when you are next in the Massachusetts Room.

We look forward to supporting the Club’s recognition of the first elected woman Governor of Massachusetts (Harvard’s own Maura Healy ’92) and other notable members of the Harvard community in the coming months as we also welcome requests from the Club to support projects or initiatives consistent with the Foundation’s charter such as historic restoration and/or preservation of various parts of the Clubhouse.

The Financial Statements of the Higginson 1908 Foundation and the legacy Harvard Club of Boston Foundation as of June 30, 2022 are included in this Annual Report, and detail the support both foundations provided As of this writing the Higginson Foundation has approximately $400,000 in assets and we have plans for additional fundraising activities in 2023 so we can broaden our support in the future.

Once again, we appreciate your voluntary contributions in support of the Higginson 1908 Foundation and look forward to expanded activities in support of the Foundation, the Club, and the community in the coming year.

Respectfully submitted,

Michael H. Shanahan, gb’82 President

Schools Committee

Paul J. Brennan ‘67, Chair

Barbara F. Berenson ‘80 Kevin M. Bolan ’92 Michelle M. Cannon ’97

Mary Ann Pesce Choate ’77 James W. Courtemanche ’82 David J. Crowley ’79

Kathleen Dorkin ‘70 Elizabeth F. Frates ‘80 Deborah Kaufman Goldfine ‘85

Robert E. Joyce ’87 Benjamin N. Levy ’69 Karen Malone ’04 Lidija M. Ortloff ‘82

Ameek A. Ponda ’89 William F. ’74 and Susan S. Samuelson ’74 Matthew D. Schnall ‘90

Christopher G. Thomas ’75 Matthias Wagner ‘90

Like many things around us, the process of college admissions has changed much in the last three years.With significantly increased financial aid, optional SAT and ACT tests, and wide-based application fee waivers, Harvard and many other competitive colleges have seen significant increases in the number of applicants

Until recent years Harvard strove to have all applicants interviewed. Now each application is given a first reading by an Admissions Officer and an Interview Priority (IVP) is assigned.Area chairpersons use these IVPs to assign interviews. This means that our Interviewers only interview applicants who have a “real chance” at being admitted.

We hope this significant change will encourage our Club members to give interviewing a try. The Harvard Alumni Association has made it very easy to get involved in interviewing. The HAA webpage page has a link where alumni can indicate the geographical area(s) where they would like to interview.

We hope many of you will join us.

Respectfully submitted,

Paul J Brennan ‘67 Chair

Reciprocal Clubs Committee

Edward Matson Sibble, Jr.’73

Aida Birley J. Christian Kryder, MIT’83 Ranganath Papanna, HMS Faculty Frederick Schernecker ’90

The reciprocal clubs program continually ranks as one of the most important and enjoyable benefits of membership. Joining the Harvard Club of Boston gives our members access to a network of over 170 premier clubs throughout the United States and the world, offering a variety of dining, overnight accommodations and athletic facilities.

The Reciprocal Clubs Committee actively seeks to establish new club relationships in cities or countries where our members’ business or leisure travels may take them, as well as helping increase Harvard Club revenue through hosting reciprocal club members during their stays in the Boston area Each of our reciprocal clubs is screened, directly or indirectly, against strict criteria The Committee also reviews and makes recommendations in relation to the day-to-day operation of the reciprocal club network. In 2022, we added 5 new reciprocal clubs to our network.

Harvard Club member requests for Letters of Introduction have been stable – a typical month sees several hundred requests through our automated system. Approximately 1/3 of those Letters are for international clubs and 2/3 for visits within the United States. Our most popular destinations continue to be New York, London, Chicago, and Washington D.C. Reciprocal club usage has almost returned to the level of use prior to the pandemic.

We will also maintain our ongoing effort to find new locations for squash, golf, beach, athletic and social facilities for our members to use when they travel. Our Committee’s plans for the future also include maintaining the quality of our current network, and continuing to seek reciprocal club relationships in new geographies, especially in Asia, Latin America and the developing world.

Harvard Club members who visit private clubs around the world which may be good candidates for reciprocity are encouraged to suggest new additions for consideration by the committee

Respectfully submitted,

Edward Matson Sibble, Jr. ’73 Chair

Member Experience Committee

Jan Saragoni, ks’89, Co-Chair Andy Freed ’90, ks’94, Co-Chair

The journey to provide the highest quality of experience and opportunity for our members continues to be our commitment, and this past year we have made considerable strides organizationally and strategically.

The Committee structure was re-imagined during the winter of 2022-23 to better reflect the goals and objective of the Committee thanks to the vision and leadership of its new co-chairs – Andy Freed and Jan Saragoni The Committee was renamed “Member Experience” with the objective to oversee the overall marketing and membership initiatives of the club with the goal of expanding membership and introducing a more strategic approach to engagement. Four key sub-groups within the committee were created and identified as key “drivers” of increasing member engagement – Member Events, Member Journey, Member Interaction and Harvard Connections.

Our full-time staff has been strengthened by an exceptionally experienced and skilled team that is responsible for all of the membership and marketing activities of the club. The roles and responsibility of this group are extensive as they are tasked to manage the journey of our members from the first interaction throughout the lifespan of their membership. They also manage the brand identity of the club and work directly with every department and numerous committees to help maintain consistent messaging and marketing within club operations. Our Senior Director of Marketing & Membership –Becky Blaeser ’98 – joined the HCB team in August and is supported by a superior team that has been understaffed due in part to the departure of the event director position in mid-December. Despite the challenges, the team has responded admirably and the commitment and sacrifice of Cheryl Moderski, Jackie Deschamps, Dan Farmer and Darius Howell should be commended The team will be looking to expand in FY2023 with the securement of a full-time events director and the addition of a membership manager to support the growing needs of our valued members.

The team has successfully managed all prospecting, on-boarding, member relations, member activities and member experience for more than 4,700 members. Member retention will continue to be a focus. This past year, we saw a slight improvement in long-term attrition levels with the loss of 384 members.

Michael F. Cronin. ’75, gb ’77 Marcus DeFlorimonte, gb’95, pmd Bernard Ho, MIT’06 Cheryl La Monica, gb’20, gmp Elizabeth Micci, ged’18 Deborah Millin, gb’22, amp Alfonso Torrijos ’94

In summary, we ended FY2022 with 3,150 dues paying members up 166 members from the previous year We continue to offer one-year complimentary membership to recent graduates from Harvard College and all the professional schools as well. This year’s new graduate initiative saw record numbers in the first days of deployment which is a bright sign for FY2023.

Our membership continues to be bolstered by the energy and interest from the MIT, Fletcher School and Yale Club membership categories. This past year, the structure of the Commonwealth membership was adjusted. The Commonwealth program – which is restricted to 50 new such members per fiscal yearnow requires each candidate to secure their own sponsor and wedding clients are no longer offered automatic membership without a sponsor. The membership staff has been fortunate to work with Deborah Millin and the Ambassador Committee. The role and responsibility of that sub-committee will be restructured and re-imagined in FY2023. The goal will be to leverage the new marketing assets and expand ambassadorship activities of the club both through experiences and geographically.

The investment in the future of the club was realized through the engagement of an outside marketing firm “Better” during FY2022, which began with a comprehensive market audit and survey of our brand from a membership perspective The result of that analysis was the development of a strategic marketing plan aimed at generating new memberships and helping with overall membership retention The team at Better was then tasked with creating new marketing assets including engaging photography and videos and updated and more relevant and compelling messaging. A marketing plan will be executed beginning this spring which will see all of the marketing assets utilized to create greater brand visibility and generate a significant increase in membership. The marketing plan will see the club – for the first time in its history – utilize a strategic mix of digital and targeted advertisements and promotions through social media platforms, the Harvard Alumni network and an internal LinkedIn ambassador program.

Despite the loss of a full-time events director, member activities have continued to expand and we now offer an average of more than 250 member activities per year. The variety of member events has been diversified to better reflect the membership demographic and needs, both in person and virtually. A renewed focus and investment in Special Interest Groups (SIGs) has seen the introduction of new SIGs –Bio-Innovation and Golf – and the increased activity of existing or previously dormant SIGS.

The lower level ClubPub has been re-activated and is slowly becoming a destination for our members. ClubPub now hosts monthly member activities including specialized events such as Team Trivia, Game Night, Viewing Parties, and Tasting Events and soon live music and limited food service will be introduced A highlight from this past year were a series of engaging Leadership Events held at the Clubhouse Last year was capped off by a Fireside Chat with Governor Maura Healey '92.

We will continue to focus on bringing high-profile speakers and presenters to the club and also look to introduce regional and even global event experiences A key priority for member events in FY2023 will be to secure a full-time events director and create a short and long-term events strategy that will take into consideration the expanding and evolving membership profile.

Our members have been enjoying access to the University of Massachusetts Club at the top of One Beacon. Activity has been steady and consistent as our members as being able to access club-level amenities in downtown Boston. Activity within our Reciprocal Network and Golf Society continues to be high and has proven to be a significant member value benefit.

Looking ahead, the work of the Committee and Staff will focus on improving the technical platform that is used to engage and communicate with members. Enhancing and expanding the relationship with the Harvard Alumni Association (HAA) will also be a priority as we aim to gain greater access to our largest membership prospect base.

Much has been accomplished, but there are huge initiatives and steps to be taken in the future as we aim to be the absolute gold standard for member engagement and be exceptional in everything that we do for our members We sincerely appreciate your support and hope you will take advantage of services and events we offer.

In conclusion, we pass along the words of Mark Zuckerberg ’17 who said that “Nothing influences people more than a recommendation from a trusted friend.” We urge you to use the power of your words and experiences to help us continue to grow our community.

Respectfully Submitted,

Jan Saragoni, ks’89, Co-Chair

Andy Freed ’90, ks’94, Co-Chair

Nominating Committee

Michael H. Shanahan, gb’82, Chair

Matthew G. Hegarty ‘82

Ruby Henry ’03 Nicholas J. Iselin ’87, gsd’92

Philip Lovejoy, HAA Tamara E. Rogers ’74 Geraldine Acuna Sunshine ’92, ks’96

Karen M. Van Winkle ’80

A reminder as to the duties of and process used by the Nominating Committee.

The Nominating Committee itself is nominated by the Board of Governors each year and voted in by the Members at the Annual Meeting, to serve until the following Annual Meeting. The slate of candidates for the Nominating Committee, including its Chair, is typically presented by the Club President to the Board of Governors in February or March The Committee consists of members of the Club who the Board feels either have been active in the Club or have insight into candidates from the community, or both

The Nominating Committee meets each December or January with the Executive Committee of the Board of Governors and the General Manager to discuss the current productivity and functionality of the Board of Governors, the range of issues which are being considered by the Board, and the areas where the Executive Committee and the General Manager thought they might need additional help from future Board members.That meeting took place in January 2023. The Committee reviewed the rosters of the various Club Committees and discussed the leadership of those committees and potential successors to those leaders.The Committee also invited each member of the Executive Committee and the General Manager to feel free to contact the Chair of the Nominating Committee if they had any concerns about the performance of any fellow officer or Board member.

In the weeks following that meeting, the Chair of the Nominating Committee had conversations with each of the members of the Executive Committee and many of the Board members, soliciting their opinions on their willingness to serve in the future, their own assessments of the performance of fellow Board members and officers, and their thoughts about potential leaders developing on various committees In addition, all members of the Nominating Committee and the General Manager were encouraged to seek input from Club Members at large about their satisfaction with the current Board and Executive Committee.The Committee also solicited suggestions from club leadership and other community members for potential nominees for the Board of Governors and reviewed their qualifications and membership credentials.

The Nominating Committee had a meeting on its own in February 2023 where it considered feedback from all of the above-mentioned sources and reviewed the needs of the Board of Governors for the upcoming year and in future years.

At that meeting the Committee reviewed a list of potential Board members that is maintained by the Chair and the Club’s Membership Secretary That list includes information on the member’s tenure with the Club, committee activity, frequency of use at the Club, and professional and educational expertise. Based upon the discussion in that meeting, the Nominating Committee priority ranks their preliminary choices for officer and Board positions and asks the Chair to have a conversation with each person so identified regarding that person’s willingness and availability to serve. With feedback from those conversations in hand, the Nominating Committee reconvened in March and, considering the information gathered by the Chair, chose a proposed slate of Officers and Board members for election at the Club’s Annual Meeting. This listing is posted in the Clubhouse and also shared via email notifications regarding the proxy voting process.

We are pleased with the slate of candidates we were able to present this year, and would be happy to receive suggestions for consideration as future members of the Board of Governors from any Member. Suggestions may be submitted to the Chair of the Nominating Committee via the Club’s Membership Secretary.

Respectfully submitted,

Michael H. Shanahan, gb’82 Chair

Prize Book Committee

Barbara D. Pulaski, ph’73, Chair

Paul J. Brennan ’67 Marcus DeFlorimonte, gb’95 PMD Louis DiBerardinis, ph’75

Philip C. Haughey ’57 Lidija Ortloff ’82 Karen Van Winkle ‘80

The twenty seventh Harvard Club Prize Book Breakfast was held on October 20, 2022 in Harvard Hall. In addition to parents, school counselors, and teachers, four principals and one superintendent of schools were in attendance.These included Principal Scott Czermak of Clinton High School, Principal Joshua Romano of Leominster High School, Principal Ted McCarty of Sutton High School, Principal Joshua Otlin of Milford High School and Dr. Steve Meyer, Superintendent of the Clinton, Massachusetts Public School system. Dr. Meyer had heard so very many positive comments about this breakfast that he was very glad to be in attendance at this annual event Principal Otlin was the recipient of one of the Excellence in Teaching Awards in the year 2008 as a teacher at the Hudson, MA High School Principal Otlin wrote to me, “The Harvard Club Excellence in Teaching Award was at the very beginning of my career Receiving it was a source of encouragement and inspiration for me. To have my principal nominate me for the award in 2008 was a tremendous source of affirmation, to have the Harvard Club recognize me was incredibly validating and encouraging… I left the Harvard Club in 2008 with a renewed confidence and excitement to push harder to deepen my impact and ultimately led me to my journey into leadership and the work I do today.”

Harvard Club President Marcus DeFlorimonte gave the welcoming address to those in attendance. While the guests were eating their breakfasts, President DeFlorimonte walked to each of the tables in Harvard Hall and personally welcomed every guest to the Harvard Club of Boston. Students at my table were very impressed that he took the time to directly talk with them. One young man stated that “President DeFlorimonte made me feel very important.”

This breakfast was dedicated to the memory of Dr. Susan Horner. Dr. Horner, a friend of the Prize Book Program, passed away just before the pandemic Her husband, Dr David Horner, President of the American College of Greece, gave an excellent description of his wife’s contributions to the field of education, both in Greece and in the United States Jasime Alexandra Sanolada and her mother, Lina, were present in the audience as representatives of the American College of Greece.

In the opening address, those in attendance were asked to notice the two flags permanently flying above the doorway to the Club’s main entrance on Commonwealth Avenue. One flag is the traditional Harvard flag. The second flag was permanently installed a year ago in October, 2021.

This flag is the tribal flag of the Native American people, called the Ponkapoag, who occupied all of the land in what is now called Boston, including the land beneath the Harvard Club of Boston

State Senator Ryan Fattman gave the main address. Mr. Fattman represents the Worcester and Norfolk District of Massachusetts on Beacon Hill. He is also the assistant minority leader on Beach Hill. Mr. Fattman talked about some of his successes and failures on his journey to establish himself in politics in Massachusetts. His talk was interesting, entertaining and those in the audience seemed to enjoy his message of always follow one’s passion no matter how unattainable it may initially seem. Mr. Fattman was presented with a Friends of Education Award and was recognized for his commitment to education at every level in the commonwealth ranging from preschool to college.

The Friends of Education award was also presented to Dr. Karen Bohlin by Paul Brennan, a member of the Prize Book Committee. Dr. Bohlin was headmaster of the Montrose Academy in Medfield, MA. While at the school, she founded the Life Campus Institute for Character and Leadership, a lab school community of practice.Currently, Dr. Bohlin is the Director of the Practical Wisdom Project at the Abigail Adams Institute in Cambridge.

Lidija Ortloff presented the Friends of Education Award to Irena Stanic Rasin, a writer, translator and instructor of literature working both in Boston and in Zagreb, Croatia; she is a co-founder and director of the Croatian School of Boston. According to Ms. Ortloff, “Ms. Rasin recently was awarded the Order of the Croatian Interlace by the President of Croatia for the advancement of progress of the Republic of Croatia and the welfare of its citizens, and the preservation of identity of the Croatian community in Boston.”

Three teachers received the Excellence in Teaching Award, given by Louise DiBerardinis. These include the following: Michael Clements of the Lawrence Central Catholic High School, Bruna Correia of the Milford High School and Yael Jaffe of Maimonides School.

Prize Book Committee member Paul Brennan talked about the history of the Prize Book Program and its relationship to Harvard University. He identified some of the portraits of past Harvard University Presidents on the walls of Harvard Hall, and told interesting stories about their tenure as president.

What were some of the students like at the Prize Book Breakfast? The students I talked to were very highly motivated and seemed to be accomplished in several areas including academic excellence Jonathan Rodriguez of the Saint John’s Preparatory School in Danvers, MA was present at the breakfast with his father Jonathan has established the Luna Club at Saint John’s The focus of this club is to teach Latin and Hispanic culture to fellow students. Jonathan expects to go to Stamford to study computer science. I talked with Joshua’s dad and he briefly described his life in the countryside of Puerto Rico.

He decided to come to the United States to get out of the extreme poverty and the complete lack of any type of opportunity in his village He said to me, “I am very happy that I have reached my goals in life to educate my two sons, and I feel that I have reached the American dream.” Mr. Rodriguez has one son currently enrolled at Harvard College and his second son will hopefully be going to Stamford.

Minh Vu was brought to the Prize Book Breakfast by Principal Joshua Romano of Leominster High School.Ms. Minh is an Eagle Scout, serves as Class Treasurer and is a star on the Math Team. Minh has a passion for both math and science and hopes to attend Tufts University to study biomedical engineering on a complete scholarship.

Carligh Harris, a brilliant student at Hobgood Charter School in North Carolina, was brought tot the Prize Book Breakfast by her grandfather, William Whitehurst. Carligh has been involved in the field of gymnastics for over ten years.She also is very involved in the youth group of the Ignite Church. Carligh completed an internship as a teacher at a local kindergarten as part of her studies at Hobgood. That experience has motivated her to decide to enter an elementary education program at either Liberty University or North Carolina State University in the upcoming fall term.

Two new members were added to the Prize Book Committee this year Karen Van Winkle has accepted the invitation to become a member as did current Harvard Club President, Marcus DeFlorimonte. Together we will work to ensure that next year’s Prize Book Breakfast will be interesting as well as relevant to the attendees.

Respectfully submitted,

Dr. Barbara D. Pulaski, ph’73 Chair

HARVARD CLUB OF BOSTON

Financial Statements for years ended August 31, 2022 and 2021

Independent Auditors’ Report

To the Board of Governors

Harvard Club of Boston

Opinion

We have audited the accompanying financial statements of the Harvard Club of Boston (a nonprofit organization) (the "Club"), which comprise the statements of financial position as of August 31, 2022 and 2021, and the related statements of changes in net assets, activities and cash flows for the years then ended, and the related notes to the financial statements.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Harvard Club of Boston as of August 31, 2022 and 2021, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Club and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Club's ability to continue as a going concern within one year after the date that the financial statements are available to be issued.

Auditors' Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

Telephone: (617) 753-9985 | Fax: (617) 753-9986

Email: info@pkfjnd.com | Website: www.pkfjnd.com

JND, P.C. | 75 State Street | Boston | Massachusetts 02109 | US

In performing an audit in accordance with generally accepted auditing standards, we:

 Exercise professional judgment and maintain professional skepticism throughout the audit.

 Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

 Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Club’s internal control. Accordingly, no such opinion is expressed.

 Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

 Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Club’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

Boston, Massachusetts

December 14, 2022

HARVARD CLUB OF BOSTON

Statements of Financial Position

HARVARD CLUB OF BOSTON

Statements of Changes in Net Assets

HARVARD CLUB OF BOSTON

Statements of Activities

HARVARD CLUB OF BOSTON

Statements of Cash Flows

Note 1 – Nature of operations

Harvard Club of Boston (the “Club”) is a member owned social club located on Commonwealth Avenue in Boston, Massachusetts. Membership consists primarily of members who have a current or past affiliation with Harvard University and live predominately in the metropolitan Boston area. The Club’s primary sources of revenue are dues and entrance fees, guest room rentals, sales of food and beverages, athletic fees and parking fees.

Note 2 – Summary of significant accounting policies

Basis of presentation

The financial statements of the Club have been prepared in accordance with accounting principles generally accepted in the United States of America, which requires the Club to report information regarding its financial position and activities according to the following net asset classifications.

Net assets without donor restrictions: Net assets that are not subject to donor-imposed restrictions and may be expended for any purpose in performing the primary objectives of the organization. These net assets may be used at the discretion of the Club’s management and Board of Governors.

Net assets with donor restrictions: Net assets subject to stipulations imposed by donors and grantors. Some donor restrictions are temporary in nature; those restrictions will be met by actions of the Club or by the passage of time; other donor restrictions are perpetual in nature, whereby the donor has stipulated funds be maintained in perpetuity.

Donor restricted contributions are reported as increases in net assets with donor restrictions. When a restriction expires, net assets are reclassified from net assets with donor restrictions to net assets without donor restrictions in the Statements of Activities.

Functional allocation of expenses

The costs of program and supporting services activities have been summarized on a functional basis in Note 14. The note also presents the natural classification detail of expenses of the Club by function. Accordingly, certain costs have been allocated among the programs and supporting services benefited.

Cash and cash equivalents

The Club considers investments with an original maturity of three months or less when purchased to be cash equivalents. As of August 31, 2022, and 2021, the Club's cash equivalents were comprised primarily of money market funds.

Accounts receivable

The Club extends credit to its members for dues, parking, athletics, and food and beverage purchases. Credit is also extended to outside parties that contract to hold events at the Club. Receivables that are over 30 days old are considered past due. No collateral is required to support accounts receivable.

The Club maintains an allowance for potentially uncollectible accounts. This allowance is set-up as a reserve based on the balance in the various aging categories and historical losses experienced relative to those categories. When management determines that a receivable is uncollectible, the amount is removed from the receivables balance and is charged against the allowance. Subsequent recoveries of amounts previously written off are credited directly to revenue. The allowance for accounts receivable was approximately $55,000 and $19,000 for 2022 and 2021, respectively.

Inventories

Inventories consist of food, beverages and supplies and are valued at the lower of cost (first-in, first-out) or net realizable value.

Property and equipment

Property and equipment are stated at cost. Depreciation and amortization are computed using the straightline method and various accelerated methods over estimated service lives as follows: buildings – 40 years; building improvements – 10 to 40 years; furniture, fixtures and equipment – 3 to 12 years. The cost of retired or disposed property and related accumulated depreciation and amortization are removed from the respective accounts. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to operations as incurred.

Impairment of long-lived assets

The Club evaluates long-lived assets and intangible assets with definite lives for impairment whenever events or changes in business circumstances indicate that the carrying amount of an asset may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the future undiscounted cash flows arising from the assets with the carrying value of the asset. If impairment is indicated, the asset is written down to its estimated fair value on a discounted cash flow basis.

Collections

The Club, over the years, has received contributions of historic and/or artistic materials. The Club has not capitalized these materials since they are held and preserved for public exhibition in keeping with the Club’s exempt purpose and are not intended to be sold.

Pension benefits

The Club's pension benefit costs are accounted for using actuarial valuations which recognize the funded status of its defined benefit pension plan on the Statements of Financial Position and recognize changes in the funded status that arise during the period but are not recognized as components of net periodic benefit cost as changes in net assets without donor restrictions.

Revenue and revenue recognition

Membership dues, which are nonrefundable, are an exchange transaction and, as such, are recognized over the membership period. Room revenue is recognized when the booked room is provided to the Member. Food and beverage and parking revenues are recognized at the time of purchase. Athletics consist of athletic facility season fees which are recognized as revenue over the applicable season period. Payments for such goods and services are generally received at the point of sale in the form of member account charges. All amounts owed by members must be paid in 30 days following presentation of the bill. The Club recognizes revenue at the point in time when goods have been provided and/or services have been rendered. With the exception of goods and services provided in connection with membership dues and athletic facility season fees, which are transferred over the applicable period, all goods and services are transferred at a point in time.

Membership dues received in advance of providing access to the exchange services are recorded as a deferred revenue (contract liability) on the Statements of Financial Position.

Entrance fees and assessments

Entrance fees are recorded as other changes in net assets in the period in which they are due.

Contributed services

Many members have contributed significant amounts of time to the Club’s activities. The financial statements do not reflect the value of these services because they do not meet the recognition criteria.

Income taxes

The Club is exempt from income taxes on member income in accordance with Section 501(c)(7) of the Internal Revenue Code. The Club is, however, subject to income taxes on its income from nonmembers and on its investment income. Management of the Club has evaluated its uncertain tax positions and related income tax contingencies and does not believe that any material uncertain tax positions exist.

The Club’s tax returns are generally subject to examination by the Internal Revenue Service and the Commonwealth of Massachusetts for a period of three years from the date they are filed.

Operating income (loss)

Operating income (loss) pertains to ordinary, day-to-day operations and includes revenues from dues and assessments, user fees and sales of food and beverages, less related expenses. The Club excludes from operating income (loss) entrance fees and unusual, nonrecurring items, such as special assessments.

Accounting estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

Credit risk

The principal financial instruments subject to credit risk are cash and cash equivalents. Credit risk represents the accounting loss that would be recognized at the reporting date if the parties failed to perform as contracted. The total of these financial instruments at times exceed the insured amounts. To mitigate credit risk, the Club places its cash and cash equivalents in investment grade companies or financial institutions. The Club has not experienced any losses on its deposits. The Club’s defined benefit pension assets are invested in separate investment accounts with Bank New York Mellon.

Note 3 – Liquidity and availability

Financial assets available for general expenditure, that is, without donor restrictions limiting their use, within one year of the Statements of Financial Position date, are comprised of the following at August 31:

As part of the Club’s liquidity management plan, cash in excess of daily requirements is invested in a money market account. The Club also has a line of credit available to meet short-term needs. See Note 7 for information about this arrangement.

Note 4 – Note receivable

The Club has a note receivable with a key employee for an amount advanced in connection with employment. The note bears interest at a rate of 2.55% per annum. The note is unsecured.

Note 5 – Property and equipment

Property and equipment consist of the following:

Depreciation expense was $988,358 and $1,246,017 for 2022 and 2021, respectively.

Construction in progress consists mostly of legal and consulting costs related to planning and scoping for a future construction project. The construction project is currently in a preliminary phase and the Club will not break ground on the project until various approvals have been received from the City of Boston.

Note 6 – Deferred compensation

The Club maintains deferred compensation plans with certain key employees under the provisions of Internal Revenue Code Section 457(b). The Club had purchased, as owner and beneficiary, a life insurance policy on the life of one employee. In 2021, the policy was liquidated and the cash surrender value of the policy was distributed to the insured employee. Accrued deferred compensation, representing the vested portion of the future cash payments, approximates $369,000 and $357,000 as of August 31, 2022 and 2021, respectively. The Club contributed $41,000 and $19,500 to the plan for the years ended August 31, 2022 and 2021, respectively.

Note 7 – Line of credit

The Club has a revolving line of credit with a bank under which the Club can borrow up to $5,000,000 for working capital purposes through February 28, 2024. Amounts borrowed bore interest at the bank’s prime rate of interest plus 1.75% (5.00% as of August 31, 2021). On May 17, 2022 the agreement was amended to change the interest rate to the bank’s Base Rate, as defined in the agreement. (5.50% as of August 31, 2022). Interest is payable monthly. There was no outstanding balance as of August 31, 2022 and 2021.

Note 8 – Long-term debt

Long term debt consists of the following:

A.

B.

economic injury disaster loan

A. The Club has a commercial real estate mortgage loan that matures in April 2025. For the first five years in which the loan is outstanding, the loan bears interest at a fixed rate of 4.26%. Subsequently, the rate is adjusted to the then current Federal Home Loan Bank rate plus 2.50%. In June 2020, the fixed rate changed to 3.69% in accordance with the terms of the loan agreement. Principal and interest is payable monthly based on a 20-year amortization schedule.

B. On June 24, 2020, the Club obtained a $150,000 economic injury disaster loan from the U.S. Small Business Administration (SBA). The loan was secured by all tangible and intangible personal property of the Club. The loan bore interest at a fixed rate of 2.75%. The loan was originally scheduled to mature on June 24, 2050. In May 2022, the Club repaid the outstanding principal and interest on the loan.

The line of credit and the commercial real estate mortgage are secured by substantially all real and personal property of the Club and contain customary financial covenants.

The following is a summary of principal payments due in each year following August 31, 2022:

Note 9 – Loan – Paycheck Protection Program (PPP)

In May 2021, the Club applied for and was approved for a $1,901,225 loan under the PPP created as part of the relief efforts related to COVID-19 and administered by the U.S. Small Business Administration. The loan accrued interest at 1%, but payments were not required to begin for ten months after the last day of the loan forgiveness covered period. The loan was uncollateralized and was fully guaranteed by the Federal government. On May 16, 2022, the Club was granted loan forgiveness for the $1,901,225 loan. The SBA requires that borrowers maintain documents supporting their applications for six years. As of August 31, 2022, the loan forgiveness is presented as non-operating income on the Statements of Activities and as a non-cash reconciling item in operating activities on the Statements of Cash Flows.

Note 10 – Retirement plans

Defined benefit pension plan

The Club maintains a noncontributory defined benefit pension plan (the “Plan”) for eligible employees. Benefits are based on employees’ years of service and compensation as defined in the plan. The Club’s policy is to contribute amounts sufficient to fund benefits provided by the plan, based on ERISA’s minimum annual funding requirements. Contributions are intended to provide not only for benefits attributed to services incurred to date, but also for those expected to be earned in the future. The Plan’s actuary performed the computations required for financial statement disclosure as of August 31, 2022 and 2021.

Effective September 1, 2012, the Club elected to curtail its defined benefit pension plan and froze benefits. The following table presents defined benefit plan disclosures required under current accounting standards.

recognized in the Statements of Financial Position not yet recognized as a component of net

Plan assets

The Plan’s weighted-average asset allocations, by asset category, are as follows:

Asset allocations reflect the investment policy set by the Club’s Retirement Committee and communicated to the investment manager.

The following table summarizes investments, at fair value, held by the Plan:

Fair value refers to the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date. The fair value hierarchy gives the highest priority to quoted market prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). Fair value measurements are required to be separately disclosed by level within the fair value hierarchy. The Plan’s investments at August 31, 2022 and 2021 are classified as Level 1 and 2.

Expected long-term rate of return on plan assets

The expected long-term rate of return on plan assets assumption is based on historical experience and consultation with the plan’s actuary. The revised 6.00% assumption compares to the 28-year historical weighted average annual compound return of 6.10% actually achieved by the plan assets.

Cash flow information

Contributions

The minimum contribution due for fiscal year 2023 is $86,204.

Estimated benefit payments

Plan contributions are made and the actuarial present value of accumulated plan benefits are reported based on certain assumptions pertaining to interest rates, inflation rates and employee demographics, all of which are subject to change. Due to uncertainties inherent in the estimations and assumptions process, it is at least reasonably possible that changes in these estimates and assumptions in the near term would be material to the financial statements.

In 2022, certain administrative fees incurred by the Plan were paid for by the Club. As of August 31, 2022, $171,008 of these fees are due to the Club from the Plan and are included in accounts receivable on the Statements of Financial Position.

Defined contribution plans

The Club maintains defined contribution plans under Section 401(k) of the Internal Revenue Code. Club employees who satisfy certain other conditions are eligible to participate in the plans and contribute eligible compensation, subject to certain limitations. Substantially all administrative costs are borne by the Club.

Employee contributions to the defined contribution plans are matched by the Club under safe harbor provisions. The Club matches contributions up to 5% of eligible compensation. During 2022 and 2021 there were approximately $166,000 and $142,000 in employer matching contributions, respectively.

Note 11 – Commitments

Operating leases

The Club leased its Federal Street premises under an operating lease which expired on December 31, 2020. The Club is also committed to operating leases for fitness and office equipment that have remaining noncancellable lease terms in excess of one year at August 31, 2022. Future minimum lease payments under the aforementioned non-cancelable operating lease agreements consist of approximately $33,461 due over the course of the year ending August 31, 2023.

Note 12 – Labor subject to collective bargaining agreement

Approximately 54% of the Club’s labor force is covered by a collective bargaining agreement, which expires on June 30, 2024.

Note 13 – Fixed expenses

The components of fixed expenses are as follows:

Note 14 – Functional expenses

The financial statements report certain categories of expenses that are attributed to more than one program or supporting function. Therefore, expenses require allocation on a reasonable basis that is consistently applied. The expenses that are allocated include repairs and maintenance, insurance, real estate taxes, depreciation and amortization, interest and utilities, which are allocated based on a squarefootage basis. Also, salaries and wages and payroll taxes and benefits are allocated on the basis of estimates of time and effort.

HARVARD CLUB OF BOSTON Notes to Financial Statements

The Club’s expenses by nature and function for the year ended August 31, 2022 are as follows:

The Club’s expenses by nature and function for the year ended August 31, 2021 are as follows:

Note 15 – Related parties

Harvard Club of Boston Foundation

The Harvard Club of Boston Foundation ("Foundation") is a trust established by the Club and administered by the trustee in accordance with the Declaration of Trust and the laws of the Commonwealth of Massachusetts. The Foundation is exempt from Federal income taxes under Section 501(c)(3) of the Internal Revenue Code. The Club's Board of Governors serves as trustee. The trustee appoints and oversees a committee with responsibility for the Foundation's day-to-day operations. The Foundation fosters scientific, literary and educational interests among members of the Club and advances and promotes the welfare of Harvard University.

The Higginson 1908 Foundation, Inc.

The Higginson 1908 Foundation, Inc. ("Higginson Foundation") was organized as a not-for-profit corporation on November 23, 2015 and is administered by its Board of Directors in accordance with its bylaws and the laws of the Commonwealth of Massachusetts. The Higginson Foundation is exempt from Federal income taxes under Section 501(c)(3) of the Internal Revenue Code. The Higginson Foundation's purpose is to preserve and protect old and historic buildings, artwork and other property in Boston, Massachusetts and its surrounding area in order to perpetuate the further education of posterity with regard to the arts and the architectural, historic, and general cultural heritage of the Boston, Massachusetts area. Its further purpose is to encourage education and personal advancement for youth in the Greater Boston area, to foster scientific, literary and educational interests among members of the Club and to advance the interests and promote the welfare of Harvard University.

The Club’s Commonwealth Avenue Clubhouse will be the first historic renovation project. The Foundation will make grants to the Club to restore artwork owned and exhibited by the Club. The officers and directors of the Higginson Foundation are members of the Club and some are current board members of the Club; however, the Higginson Foundation will remain an independent organization dedicated solely to its charitable and educational purposes. It is expected that the Higginson Foundation will take over several charitable programs currently conducted by the Foundation.

The Club provides administrative support staff to the Higginson Foundation, for which the Higginson Foundation reimburses the Club. The Club requests that its members donate funds for students attending Harvard University, Harvard Prize Books, and for the appraisal and cataloguing of the art collection at the Club. Donations collected by the Club are remitted to the Higginson Foundation. As of August 31, 2022 and 2021, the Club owes the Higginson Foundation approximately $1,000 and $-0-, respectively. The Club accounts for the donations as agency transactions and does not reflect them in its financial statements. Donations received for 2022 and 2021 totaled approximately $159,000 and $93,000, respectively.

Note 16 – Employee retention credit

The Coronavirus Aid, Relief and Economic Security Act, also known as the CARES Act, was passed by the U.S. Congress and signed into law by the President on March 27, 2020 in response to the economic fallout of the COVID-19 pandemic in the United States. The Employee Retention Credit is one of the provisions included in the CARES Act. The Employee Retention Credit is a fully refundable tax credit for employers equal to 50 percent of qualified wages (including allocable qualified health plan expenses) that eligible employers pay their employees. The Employee Retention Credit applies to qualified wages paid after March 12, 2020 and before January 1, 2021. The maximum amount of qualified wages taken into account with respect to each employee for all calendar quarters is $10,000, so that the maximum credit for an eligible employer for qualified wages paid to any employee is $5,000. In order to be eligible for the payroll tax credit, the employer must either have had its operations fully or partially suspended as a result of a COVID-19 related shut down order or have incurred a decline in gross receipts by more than 50 percent when compared to the same quarter in the prior year.

The Consolidated Appropriations Act (CAA) passed in December 2020 included extensions and modifications of many provisions of the CARES Act. Effective January 1, 2021, the Employee Retention Credit is extended for two more calendar quarters, through June 30, 2021. The CAA increases the maximum credit to $7,000 per employee for each of the two quarters in 2021. This is done by providing a $10,000 maximum in each employee’s aggregate qualified wages and qualified health expenses for each quarter and by increasing the credit to 70 percent of the employee’s qualified wage and health expense amounts for that quarter. The CAA also changes one of the eligibility tests so an employer that has had a more than 20 percent decline in gross receipts in 2021, compared to the same quarter in 2019, satisfies the gross receipts test. In addition, the new rule allows an employer to elect to use the gross receipts from the immediately preceding quarter and compare these prior quarter gross receipts to the same quarter in 2019, rather than the current quarter. The American Rescue Plan Act further extended the Employee Retention credit through the end of December 2021.

Notes to Financial Statements

The Club was eligible for the credit due to having its operations fully or partially suspended as a result of a COVID-19 related shut down order. During the years ended August 31, 2022 and 2021, the Club claimed credits totaling $124,061 and $1,626,340, respectively.

Note 17 – Risks and uncertainties

Beginning in January 2020, global financial markets have experienced, and continue to experience, significant volatility resulting from the spread of a virus known as COVID-19. The outbreak has had a material adverse effect on global, national and local economies, as well as on the Club’s operations by disrupting supply chains and delaying transactional activities. The potential impact of a pandemic, epidemic or outbreak of a contagious disease on the Club’s operations is difficult to predict, and this could have a material adverse effect on the Club’s results of operations and financial condition. Future potential impacts may include continued disruptions or restrictions on the Club’s ability to offer in-person events and accurate forecasting of the following year budget. Management is carefully monitoring the situation and evaluating its options during this time.

Note 18 – Subsequent events

The Club has evaluated all events and transactions through December 14, 2022, the date the financial statements were available to be issued. In addition to the matter discussed in Note 17, the Club identified the following:

On October 17, 2022, the Club entered into a purchase and sale agreement to sell one of the Club’s liquor licenses to a third party for $450,000. The closing of the sale is contingent upon final regulatory approvals.

HARVARD CLUB OF BOSTON FOUNDATION

Financial Statements for years ended June 30, 2022 and 2021 (With Independent Accountants’ Compilation Report)

Independent Accountants’ Compilation Report

To the Trustee

Harvard Club of Boston Foundation

Management is responsible for the accompanying financial statements of the Harvard Club of Boston Foundation (a nonprofit organization), which comprise the statements of financial position as of June 30, 2022 and 2021, and the related statements of activities and changes in net assets, functional expenses, and cash flows for the years then ended, and the related notes to the financial statements in accordance with accounting principles generally accepted in the United States of America. We have performed compilation engagements in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the AICPA. We did not audit or review the financial statements nor were we required to perform any procedures to verify the accuracy and completeness of the information provided by management. We do not express an opinion, a conclusion, nor provide any assurance on these financial statements.

December 14, 2022

HARVARD CLUB OF BOSTON FOUNDATION

HARVARD CLUB OF BOSTON FOUNDATION Statements of Activities and Changes in Net Assets (See Independent Accountants’ Compilation Report)

HARVARD CLUB OF BOSTON FOUNDATION

Statements of Functional Expenses

(See Independent Accountants’ Compilation Report)

Year Ended June 30, 2022

Year Ended June 30, 2021 Scholarships and Student Program Management and

HARVARD CLUB OF BOSTON FOUNDATION

Statements of Cash Flows (See Independent Accountants’ Compilation Report)

HARVARD CLUB OF BOSTON FOUNDATION

Notes to Financial Statements

(See Independent Accountants’ Compilation Report)

Note 1 – Organization purpose and operation

The Harvard Club of Boston Foundation ("Foundation") is a trust established by the Harvard Club of Boston ("Club") and administered by the Trustee in accordance with the Declaration of Trust and the laws of the Commonwealth of Massachusetts. The Club's Board of Governors serves as the Trustee ("Trustee"). The Trustee appoints and oversees a committee with responsibility for the Foundation's day-to-day operations. The Foundation fosters scientific, literary and educational interests among members of the Club and advances and promotes the welfare of Harvard University. General operating purposes are:

 Granting scholarships to undergraduate students attending Harvard College;

 Granting scholarships and fellowships to students attending selected Harvard University graduate schools;

 Granting nonprofit management fellowships to Harvard College students for work at Harvard University's Phillips Brooks House;

 Providing Horblit concert stipends to Harvard University students who perform concerts; and

 Awarding Harvard Prize Books to outstanding high school students (primarily from Massachusetts) who have just completed their junior year in high school, as well as honoring outstanding Massachusetts high school teachers and other individuals who inspire curiosity and excellence in students.

Note 2 – Accounting policies Basis of accounting

The financial statements of the Foundation have been prepared on the accrual basis in conformity with accounting principles generally accepted in the United States of America. Consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred.

Classification and reporting of net assets

Accounting principles generally accepted in the United States of America requires the Foundation to report information regarding its financial position and activities according to the following net asset classifications:

Net assets without donor restrictions: Net assets that are not subject to donor-imposed restrictions and may be expended for any purpose in performing the primary objectives of the organization. These net assets may be used at the discretion of the Foundation’s Trustee.

Net assets with donor restrictions: Net assets subject to stipulations imposed by donors and grantors. Some donor restrictions are temporary in nature; those restrictions will be met by actions of the Foundation or by the passage of time; other donor restrictions are perpetual in nature, whereby the donor has stipulated funds be maintained in perpetuity.

Donor restricted contributions are reported as increases in net assets with donor restrictions if they are received with donor stipulations that limit the use of the donated assets. When a restriction expires, that is, when a stipulated time restriction ends, or purpose restriction is accomplished, net assets with donor restrictions are reclassified to net assets without donor restrictions in the Statements of Activities and Changes in Net Assets, as net assets released from restrictions.

HARVARD CLUB OF BOSTON FOUNDATION

Notes to Financial Statements

(See Independent Accountants’ Compilation Report)

Cash

The Foundation considers all unrestricted highly liquid investments with an initial maturity of three months or less to be cash equivalents.

Investment

Investment is carried at fair value. See discussion under Note 5 – Fair Value Measurements for a description of the methodologies used for assets measured at fair value. Investment income is reported in the Statements of Activities and Changes in Net Assets and consists of interest income, realized and unrealized gains and losses, less external and direct internal investment expenses.

Contributions

The Foundation recognizes contributions when cash, securities or other assets; an unconditional promise to give; or a notification of a beneficial interest is received. Conditional promises to give, that is, those with a measurable performance or other barrier and a right of return, are not recognized until the conditions on which they depend have been met.

Scholarships and fellowships

The Foundation recognizes expenses for scholarships and fellowships when they are approved and are unconditionally promised to the recipients. Scholarship awards are conditioned on the recipients remaining enrolled as students at Harvard University and the awards are recognized annually as this condition is met.

Functional expense allocations

The costs of program and supporting services activities have been summarized on a functional and natural classification basis in the Statements of Functional Expenses. Expenses that can be identified with a specific program or supporting service are charged directly to the program or supporting service. Expenses which apply to more than one functional category have been allocated based on estimates made by management.

Use of estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates.

Note 3 – Liquidity and availability

Financial assets available for general expenditure, that is, without donor or other restrictions limiting their use, within one year of the Statement of Financial Position date are comprised of the following:

HARVARD CLUB OF BOSTON FOUNDATION

Notes to Financial Statements

(See Independent Accountants’ Compilation Report)

Endowment funds consist of donor-restricted endowments and funds designated by the Board as endowments. Income from donor-restricted endowments is restricted for specific purposes and is not available for general expenditure.

Board-designated endowment of $6,558,560 and $6,687,221 at June 30, 2022 and 2021, respectively, is subject to an annual spending rate. Although it is not the intent to spend from this board-designated endowment (other than amounts appropriated for general expenditure as part of the Board’s annual budget approval and appropriation), these amounts could be made available if necessary.

Note 4 – Investment and investment income

The Foundation has an agreement with Harvard University ("University") pursuant to which the University invests the Foundation's funds. The agreement provides that the Foundation's funds may be pooled with other funds managed by the University. The Foundation has the right to withdraw these funds.

The investment in the Harvard University Pooled General Investment Account (“GIA”) is carried at fair value as provided by Harvard University ("University"). The investments in the Pooled Account are managed by Harvard Management Company ("HMC"), a wholly-owned subsidiary of the University. The Foundation has categorized the investment as a Level 2 fair value measurement in accordance with the Fair Value Measurements topic of the FASB Accounting Standards Codification ASC 820.

Units in the GIA are assigned to each fund on the basis of the fair value of the GIA at or near the time assets are received for investment. Investment income is allocated among the funds based on each fund’s units.

The Harvard University Pooled General Investment Account’s investment strategy incorporates a diversified asset allocation approach and maintains, within defined limits, exposure to the movements of the global public and private equity, fixed income, real estate, and commodities markets. Exposure to these markets is achieved through direct investments in individual securities, investments in special purpose vehicles and/or through investment in vehicles advised by external managers. (See Harvard University's 2022 financial report for additional information).

Investments in global markets involve a multitude of risks such as price, interest rate, market, sovereign, currency, liquidity, and credit risks, amongst many others. The University manages exposure to these risks through established policies and procedures related to its ongoing investment diligence and operational due diligence programs. The University anticipates that the value and composition of its investments may, from time to time, fluctuate substantially in response to any and all of the risks described herein.

The following is a summary of investment income (loss):

HARVARD CLUB OF BOSTON FOUNDATION

Notes to Financial Statements

(See Independent Accountants’ Compilation Report)

Note 5 – Fair value measurements

The Fair Value Measurements topic of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820 establishes a framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.

The fair value of the Foundation’s investment in the Harvard University Pooled General Investment Account is determined based on per unit Net Asset Value (“NAV”) provided by Harvard University. There has been no change in the methodology used.

The method described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values.

Note 6 – Scholarships and fellowships

The Foundation provided funds to Harvard College for undergraduate scholarships totaling $512,322 and $475,398 for the years ended June 30, 2022 and 2021, respectively. The Foundation also provided to Harvard College a Summer Community Fellowship in the amount of $5,000 during the year ended June 30, 2022.

Note 7 – Tax status

The Foundation is exempt from Federal and State income taxes under Section 501(c)(3) of the Internal Revenue Code and is not classified as a private foundation. Contributions to the Foundation are deductible by donors for income tax purposes.

The Income Taxes topic of the FASB ASC prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Management of the Foundation has evaluated its uncertain tax positions and related income tax contingencies and does not believe that any material uncertain tax positions exist.

The Foundation’s tax returns are generally subject to examination by the Internal Revenue Service and the Commonwealth of Massachusetts for a period of three years from the date they are filed.

HARVARD CLUB OF BOSTON FOUNDATION

Notes to Financial Statements

(See Independent Accountants’ Compilation Report)

Note 8 – Net assets with donor restrictions

Net assets with donor restrictions are restricted for the following purposes:

Subject to appropriation and expenditure for a specified purpose

Original gifts and required retained earnings (corpus)

Nathaniel J. Young, Jr. Scholarship Fund

The Fund is to be used “to support scholarships for men and women students at Harvard College from the City of Boston public high and Latin schools”.

Net assets released from donor restrictions by incurring expenses satisfying the restricted purpose or by occurrence of the passage of time or other events specified by the donors are as follows:

Notes to Financial Statements

(See Independent Accountants’ Compilation Report)

Note 9 – Endowment net assets

The Foundation’s endowment consists of approximately 15 individual funds established for a variety of purposes. Its endowment includes both donor-restricted endowment funds and funds designated by the Board to function as endowments. As required by accounting principles generally accepted in the United States of America, net assets associated with endowment funds, including funds designated by the Board to function as endowments, are classified and reported based on the existence or absence of donorimposed restrictions.

The Foundation has adopted investment and spending policies for endowment assets that attempt to provide a reasonable stream of funding to programs supported by its endowment while seeking to maintain the purchasing power of the endowment assets. The endowment assets are invested in a manner intended to produce results that exceed the price and yield results of the S&P 500 index while assuming a reasonable level of investment risk.

The Foundation has a policy for appropriating for distribution an amount that considers the distribution in relation to the total percentage of the endowment, as well as the long-term expected return on its endowment.

The Board of the Foundation has interpreted the State Prudent Management of Institutional Funds Act (SPMIFA) as requiring the preservation of the fair value of the original gift as of the gift date of the donorrestricted endowment funds absent explicit donor stipulations to the contrary. As a result of this interpretation, the Foundation classifies as net assets with donor restrictions (a) the original value of gifts donated to the endowment in perpetuity, (b) the original value of subsequent gifts to the endowment in perpetuity, and (c) accumulations to the endowment in perpetuity made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. Donor-restricted amounts not retained in perpetuity are subject to appropriation for expenditure in a manner consistent with the standard of prudence prescribed by SPMIFA. In accordance with SPMIFA, the Foundation considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds:

1. The duration and preservation of the fund

2. The purposes of the Foundation and the donor-restricted endowment fund

3. General economic conditions

4. The expected total return from income and the appreciation of investments

5. The investment policies of the Foundation

The following is the composition of endowment net assets by type of fund:

HARVARD CLUB OF BOSTON FOUNDATION

The following is a summary of the changes in endowment net assets:

Note 10 – Related party

Harvard Club of Boston

The Club is a member owned social club located in Boston, Massachusetts. The Club’s primary purpose is to provide a social meeting place for its members. The Club’s Board of Governors serves at the Trustee of the Foundation; however, the Foundation remains an independent organization dedicated solely to its charitable and educational purposes. The Foundation’s operations are maintained separately from the Club’s operating activities and its assets are not available to the Club.

The Higginson 1908 Foundation, Inc.

The Higginson 1908 Foundation, Inc. ("Higginson Foundation") is a not-for-profit corporation administered by its Board of Directors in accordance with its bylaws and the laws of the Commonwealth of Massachusetts. The Higginson Foundation is exempt from Federal income taxes under Section 501(c)(3) of the Internal Revenue Code. Its purpose is to preserve and protect old and historic buildings, artwork and other property in Boston, Massachusetts and its surrounding area in order to perpetuate the further education of posterity with regard to the arts and the architectural, historic, and general cultural heritage of the Boston, Massachusetts area. Its further purpose is to encourage education and personal advancement for youth in the Greater Boston area, to foster scientific, literary and educational interests among members of the Club and to advance the interests and promote the welfare of Harvard University.

HARVARD CLUB OF BOSTON FOUNDATION

Notes to Financial Statements

(See Independent Accountants’ Compilation Report)

The Club’s Commonwealth Avenue Clubhouse will be the first historic renovation project. The Higginson Foundation will make grants to the Club to restore artwork owned and exhibited by the Club. The directors of the Higginson Foundation are currently members of the Club and one officer is currently an officer of the Club; however, the Higginson Foundation will remain an independent organization dedicated solely to its charitable and educational purposes.

Note 11 – Risk and uncertainties

Beginning in January 2020, global financial markets have experienced, and continue to experience, significant volatility resulting from the spread of a virus known as COVID-19. The outbreak has had a material adverse effect on global, national and local economies, as well as on the Foundation’s operations by disrupting scheduled events and creating volatility in markets which could affect the value of the Foundation’s investment. The potential impact of a pandemic, epidemic or outbreak of a contagious disease on the Foundation’s operations is difficult to predict, and this could have a material adverse effect on the Foundation’s results of operations and financial condition.

Note 12 – Subsequent events

The Foundation has evaluated all events and transactions through December 14, 2022, the date the financial statements were available to be issued. Except for the matter discussed in Note 11, there were no events or transactions that occurred that would require recognition or disclosure in the financial statements.

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Financial Statements and Supplemental Schedules for years ended August 31, 2022 and 2021

Independent Auditors’ Report

To the Plan Administrator Harvard Club of Boston Retirement Plan for Employees

Scope and Nature of the ERISA Section 103(a)(3)(C) Audit for the 2022 Financial Statements

We have performed an audit of the accompanying financial statements of Harvard Club of Boston Retirement Plan for Employees, an employee benefit plan subject to the Employee Retirement Income Security Act of 1974 (ERISA), as permitted by ERISA Section 103(a)(3)(C) (“ERISA Section 103(a)(3)(C) audit”). The financial statements comprise the statements of net assets available for benefits as of August 31, 2022, and the related statement of changes in net assets available for benefits for the year then ended, and the related notes to the financial statements.

Management, having determined it is permissible in the circumstances, has elected to have the audit of the Harvard Club of Boston Retirement Plan for Employees’ 2022 financial statements performed in accordance with ERISA Section 103(a)(3)(C) pursuant to 29 CFR 2520.103-8 of the Department of Labor's Rules and Regulations for Reporting and Disclosure under ERISA. As permitted by ERISA Section 103(a)(3)(C), our audit need not extend to any statements or information related to assets held for investment of the plan (investment information) by a bank or similar institution or insurance carrier that is regulated, supervised, and subject to periodic examination by a state or federal agency, provided that the statements or information regarding assets so held are prepared and certified to by the bank or similar institution or insurance carrier in accordance with 29 CFR 2520.103-5 of the Department of Labor's Rules and Regulations for Reporting and Disclosure under ERISA (qualified institution).

Management has obtained a certification from a qualified institution as of and for the year ended August 31, 2022, stating that the certified investment information, as described in Note 6 to the financial statements, is complete and accurate.

Opinion on the 2022 Financial Statements

In our opinion, based on our audit and on the procedures performed as described in the Auditors’ Responsibilities for the Audit of the 2022 Financial Statements section—

 the amounts and disclosures in the 2022 financial statements referred to above, other than those agreed to or derived from the certified investment information, are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America.

 the information in the 2022 financial statements referred to above related to assets held by and certified to by a qualified institution agrees to, or is derived from, in all material respects, the information prepared and certified by an institution that management determined meets the requirements of ERISA Section 103(a)(3)(C).

Basis for Opinion on the 2022 Financial Statements

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the 2022 Financial Statements section of our report. We are required to be independent of the Harvard Club of Boston Retirement Plan for Employees and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our ERISA Section 103(a)(3)(C) audit opinion.

Responsibilities of Management for the 2022 Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Management’s election of the ERISA Section 103(a)(3)(C) audit does not affect management's responsibility for the financial statements.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Harvard Club of Boston Retirement Plan for Employees’ ability to continue as a going concern for one year after the date the financial statements are available to be issued.

Management is also responsible for maintaining a current plan instrument, including all plan amendments; administering the plan; and determining that the plan's transactions that are presented and disclosed in the financial statements are in conformity with the plan's provisions, including maintaining sufficient records with respect to each of the participants, to determine the benefits due or which may become due to such participants.

Auditors’ Responsibilities for the Audit of the 2022 Financial Statements

Except as described in the Scope and Nature of the ERISA Section 103(a)(3)(C) Audit for the 2022 Financial Statements section of our report, our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with generally accepted auditing standards, we:

 Exercise professional judgment and maintain professional skepticism throughout the audit.

 Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

 Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Harvard Club of Boston Retirement Plan for Employees’ internal control. Accordingly, no such opinion is expressed.

 Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

 Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Harvard Club of Boston Retirement Plan for Employees’ ability to continue as a going concern for a reasonable period of time.

Our audit did not extend to the certified investment information, except for obtaining and reading the certification, comparing the certified investment information with the related information presented and disclosed in the 2022 financial statements, and reading the disclosures relating to the certified investment information to assess whether they are in accordance with the presentation and disclosure requirements of accounting principles generally accepted in the United States of America.

Accordingly, the objective of an ERISA Section 103(a)(3)(C) audit is not to express an opinion about whether the financial statements as a whole are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.

Other Matters

The supplemental Schedule of Assets (Held at End of Year) and Schedule of Reportable Transactions as of and for the year ended August 31, 2022 are presented for purposes of additional analysis and are not a required part of the financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under ERISA. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information included in the supplemental schedules, other than that agreed to or derived from the certified investment information, has been subjected to auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with generally accepted auditing standards. For information included in the supplemental schedules that agreed to or is derived from the certified investment information, we compared such information to the related certified investment information.

In forming our opinion on the supplemental schedules, we evaluated whether the supplemental schedules, other than the information agreed to or derived from the certified investment information, including their form and content, are presented in conformity with the Department of Labor's Rules and Regulations for Reporting and Disclosure under ERISA.

In our opinion—

 the form and content of the supplemental schedules, other than the information in the supplemental schedules that agreed to or is derived from the certified investment information, are presented, in all material respects, in conformity with the Department of Labor’s Rules and Regulations for Reporting and Disclosure under ERISA.

 the information in the supplemental schedules related to assets held by and certified to by a qualified institution agrees to or is derived from, in all material respects, the information prepared and certified by an institution that management determined meets the requirements of ERISA Section 103(a)(3)(C).

Auditors’ Report on the 2021 Financial Statements

We were engaged to audit the 2021 financial statements of the Harvard Club of Boston Retirement Plan for Employees. As permitted by 29 CFR 2520.103-8 of the Department of Labor’s Rules and Regulations for Reporting and Disclosure under ERISA, the plan administrator instructed us not to perform and we did not perform any auditing procedures with respect to the information certified by a qualified institution. In our report dated December 9, 2021, we indicated that (a) because of the significance of the information that we did not audit, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion and accordingly, we did not express an opinion on the 2021 financial statements, and (b) the form and content of the information included in the 2021 financial statements other than that derived from the certified information were presented in compliance with the Department of Labor’s Rules and Regulations for Reporting and Disclosure under ERISA.

December 14, 2022

Boston, MA

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

RETIREMENT PLAN FOR EMPLOYEES

Statements of Changes in Net Assets Available for Benefits

HARVARD CLUB OF BOSTON

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Notes to Financial Statements

Note 1 – Description of plan

The following description of the Harvard Club of Boston Retirement Plan for Employees (the “Plan”) is provided for general information purposes only. More complete information is provided within the Plan documents.

General

The Plan is a noncontributory, defined benefit plan sponsored by the Harvard Club of Boston (the “Club”) covering all Club employees who meet the eligibility requirements and is subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”). The Plan is administered by trustees appointed by the Club, who have sole authority to control and manage the operation and administration of the Plan, subject to the Plan’s terms and provisions.

Bank New York Mellon (“BNY”) (“Custodian”) is the custodian to the Plan’s assets.

Eligibility

Effective September 1, 2012, the Plan's sponsor elected to curtail the plan and froze the benefits earned by union employees until August 31, 2015. Further, the Plan was amended to cease benefit accruals for all other employees. Effective September 1, 2015, the Plan sponsor negotiated a contract with the union employees to permanently freeze the benefits earned by union employees. As a result, there are no further benefit accruals for eligible participants and the Plan has discontinued admitting new participants.

Retirement benefits

The normal retirement benefit is based on a single life annuity, payable monthly for life, commencing on the normal retirement date (age 65). Normal monthly retirement benefits are calculated based upon one-twelfth of the sum of: (a) .9% of the highest average annual compensation earned during a 36-month period within a 120-month period of employment (up to a maximum of Covered Compensation, as defined in the Plan), multiplied by the Years of Service (up to 30); plus (b) 1.55% of such average annual compensation in excess of Covered Compensation, as defined in the Plan, multiplied by the Years of Service (up to 30); plus (c) .5% of such average annual compensation multiplied by the Years of Service in excess of 30. Other forms of payment (such as a joint and survivor annuity or a life annuity with payments guaranteed for a certain number of years) are based upon the normal retirement benefit, actuarially reduced. The Plan permits early retirement (at a reduced benefit) between ages 55–65, as well as late retirement. If the actuarially equivalent benefit is $5,000 or less, the benefit is automatically paid as a lump sum.

Death and disability benefits

The Plan provides for the payment of benefits to beneficiaries of participants who die prior to the commencement of retirement, if certain requirements have been met. The surviving spouse receives a monthly benefit, until his or her death, equal to 50% of the benefit the participant would have been entitled to if retirement had begun on the day prior to his or her death under a 50% joint and survivor pension. If a participant dies after the commencement of retirement benefit payments, benefits are paid in accordance with the participant’s election.

A participant who becomes disabled and is entitled to receive benefits under the Club’s long-term disability insurance program continues to accrue Years of Service and is entitled to receive a retirement benefit beginning at age 65. For the purpose of the benefit calculation, it is assumed that the compensation rate in effect at the time of disablement continued in effect until age 65.

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Notes to Financial Statements

Vesting

Benefits under the Plan become fully vested after five Years of Service, as defined in the Plan. There is no partial vesting.

Plan administrative expenses

The Plan’s expenses are paid either by the Plan or the Club, as provided by the plan document. Certain incidental costs incurred by the Club on behalf of the Plan are included in the financial statements of the Club and are excluded from these financial statements. Certain expenses incurred in connection with the general administration of the Plan that are paid by the Plan are recorded as deductions in the accompanying Statements of Changes in Net Assets Available for Benefits. In addition, certain investment related expenses are included in net appreciation or depreciation in fair value of investments presented in the accompanying Statements of Changes in Net Assets Available for Benefits. Significant administrative expenses included PBGC fees of $171,008 and $167,440 in 2022 and 2021, respectively.

Note 2 – Summary of significant accounting policies

Basis of accounting

The accompanying financial statements are prepared on the accrual basis of accounting.

Investment valuation and income recognition

Investments are reported at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. See discussion under Fair Value Measurements for a description of valuation methodologies used for assets measured at fair value.

Purchases and sales of securities are reflected on a trade-date basis. Gain or loss on sales of investments is based on average cost. The Plan presents the net appreciation or depreciation in the fair value of its investments in the Statements of Changes in Net Assets Available for Benefits which consists of the realized gains or losses and the unrealized appreciation and depreciation on those investments. Interest income is recorded as earned, on an accrual basis. Dividend income is recorded on the ex-dividend date.

Actuarial cost method

The method used to determine the normal cost and actuarial accrued liability is the Projected Unit Credit Cost method.

Accumulated plan benefits

Accumulated plan benefit information is presented as of the end of the Plan year.

Payment of benefits

Benefit payments to participants are recorded upon distribution.

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Notes to Financial Statements

Accounting estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

Note 3 – Actuarial present value of accumulated plan benefits

Accumulated plan benefits are those future payments that are attributable under the Plan’s provisions to the service that employees have rendered. Accumulated plan benefits include benefits expected to be paid to (a) retired or terminated employees or their beneficiaries, (b) beneficiaries of employees who have died, and (c) present employees or their beneficiaries. Benefits payable under all circumstances – retirement, death, disability, and termination of employment – are included, to the extent they are deemed attributable to employee service rendered to the valuation date.

The actuarial present value of accumulated plan benefits is determined by the Plan’s actuary and is that amount which results from applying actuarial assumptions to adjust the accumulated plan benefits to reflect the time value of money and the probability of payment between the valuation date and the expected date of payment. The actuarial value of accumulated plan benefits is as follows as of:

The net increase is a result of the following changes:

The significant actuarial assumptions used in the valuations for both periods were: retirement age (65); life expectancy (the 2022 and 2021 Mortality Tables); discount rate (4.45% and 7.0% for August 31, 2022 and 2021, respectively); and investment return (6% and 7.5% for August 31, 2022 and 2021, respectively). The actuarial valuation reflects the benefit freeze effective September 1, 2012 and the related assumptions are based on the presumption that the Plan will continue. If the Plan were terminated, different actuarial assumptions and other factors might be applicable.

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Note 4 – Funding policy

Contributions are actuarially determined and are sufficient to fund the benefits provided by the Plan based on the minimum funding requirements of ERISA. Contributions are made during the period in accordance with the regulations. The Club has a policy of making all required contributions by the due date of the Plan’s Form 5500.

Note 5 – Plan termination

Although the Club has not expressed any intent to terminate the Plan, it has the right to do so, subject to the provisions set forth in ERISA. If the Plan were to terminate, the net assets of the Plan would be allocated, as prescribed by ERISA and its related regulations, generally to provide the following benefits in the order indicated:

(a) Annuity benefits that former employees or their beneficiaries have been receiving for at least three years, or that employees eligible to retire for that three-year period would have been receiving if they had retired with benefits in the normal form of annuity under the Plan. The priority amount is limited to the lowest benefit that was payable (or would have been payable) during those three years. The amount is further limited to the lowest benefit that would be payable under Plan provisions in effect at any time during the five years preceding Plan termination.

(b) Other vested benefits insured by the Pension Benefit Guaranty Corporation (“PBGC”) (a U.S. government agency) up to the applicable limitations (discussed below).

(c) All other vested benefits (that is, vested benefits not insured by the PBGC).

(d) All nonvested benefits.

Certain benefits under the Plan are insured by the PBGC if the Plan were to terminate. Generally, the PBGC guarantees most vested normal retirement benefits, early retirement benefits, and certain disability and survivor’s pensions. However, the PBGC does not guarantee all types of benefits under the Plan, and the amount of benefit protection is subject to certain limitations. Vested benefits under the Plan are guaranteed at the level in effect on the date of the Plan’s termination. However, there is a statutory ceiling, which is adjusted periodically, on the amount of an individual’s monthly benefit that the PBGC guarantees.

Whether all participants would receive their benefits if the Plan were to terminate would depend on the sufficiency, at that time, of the Plan’s net assets to provide for accumulated benefit obligations and may also depend on the financial condition of the Plan sponsor and the level of benefits guaranteed by the PBGC.

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Notes to Financial Statements

Note 6 – Information certified by the custodian (unaudited)

The following information included in the Plan's financial statements was derived from data that has been certified by the custodian as being complete and accurate and has been furnished to the plan administrator. The supplemental schedules also include unaudited information.

Note 7 – Fair value measurements

The Fair Value Measurements topic of the FASB Accounting Standards Codification (FASB ASC) establishes a framework for measuring fair value. The framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted observable inputs (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are: Level 1, defined as observable inputs such as quoted market prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The asset's or liability's fair value measurement level within the fair value hierarchy is based on lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.

The following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at August 31, 2022 and 2021.

Corporate bonds: Valued using pricing models maximizing the use of observable inputs for similar securities. This includes basing value on yields currently available on comparable securities of issuers with similar credit ratings.

Corporate stocks: Valued at the closing price reported on the active market on which the individual securities are traded.

Mutual funds: Valued at the Net Asset Value (NAV) of shares held by the Plan at year end. The NAV is a quoted price in an active market.

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Notes to Financial Statements

The following table sets forth the Plan’s assets at fair value in accordance with the fair value hierarchy levels:

Note 8 – Tax status

The Plan obtained its latest determination letter on March 30, 2018, in which the Internal Revenue Service stated that the Plan, as then designed, was in compliance with the applicable requirements of the Internal Revenue Code. The Plan has been amended since receiving the determination letter. However, the Plan Administrator believes that the Plan is currently designed and being operated in compliance with the applicable requirements of the Internal Revenue Code.

Accounting principles generally accepted in the United States of America require Plan management to evaluate tax positions taken by the Plan and recognize a tax liability (or asset) if the Plan has taken an uncertain tax position that more likely than not would not be sustained upon examination by Federal or State tax authorities. The Plan administrator has analyzed the tax positions taken by the Plan, and has concluded that as of August 31, 2022, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan administrator believes it is no longer subject to income tax examinations for years prior to 2018.

Note 9 – Risks and uncertainties

On March 11, 2020, the World Health Organization classified an outbreak of the novel strain of coronavirus (COVID-19) a global pandemic, which has adversely impacted the global economy by disrupting supply chains, lowering equity market valuations, creating significant volatility and disruption in financial markets, and increasing unemployment levels. While the length and severity of this pandemic cannot be reasonably estimated, it may negatively impact the market price of Plan assets.

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Notes to Financial Statements

The Plan invests in various investment securities. Investment securities are exposed to various risks, such as interest rate, market, and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and such changes could materially affect the amounts reported in the Statements of Net Assets Available for Benefits.

Plan contributions are made and the actuarial present value of accumulated plan benefits are reported based on certain assumptions pertaining to interest rates, inflation rates and employee demographics, all of which are subject to change. Due to uncertainties inherent in the estimations and assumptions process, it is at least reasonably possible that changes in these estimates and assumptions in the near term would be material to the financial statements.

Note 10 – American Rescue Plan Act of 2021

The Plan implemented the provisions of the American Rescue Plan Act of 2021 (ARPA-21) that was signed into law on March 11, 2021. The ARPA-21 provisions implemented by the Plan are as follows:

 The Extended Amortization provisions are effective with the Plan year beginning September 1, 2020, and all subsequent plan years.

 The Extension of Pension Funding Stabilization Percentages provisions for IRC §430 purposes are effective with the Plan year beginning September 1, 2020, and all subsequent plan years.

The extended amortization provisions allow for all current shortfall amortization basis for prior plan years to be reduced to zero and all new shortfalls to be amortized over 15 years. The pension funding stabilization provisions allow for the use of higher segment interest rates used to calculate pension liabilities for minimum funding purposes, which could initially result in a lower plan liability and thus reduce the funding requirement. The implementation of these provisions reduced the Plan’s 2022 and 2021 funding requirements.

Note 11 – Related parties

Affiliates of the Custodian sponsor investments and provide recordkeeping services to the Plan. These investments and the administrative fees associated with these services qualify as party-in-interest transactions.

As of August 31, 2022, the Plan owes the Plan Sponsor $171,008 for the 2021 PBGC premium.

Note 12 – Subsequent events

The Plan has evaluated all events and transactions through December 14, 2022, the date the financial statements were available to be issued. There were no subsequent events or transactions that occurred that would require recognition or disclosure in the financial statements.

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Schedule H, Line 4i - Schedule of Assets (Held at End of Year)

Plan Year Ending August 31, 2022

PLAN NO. 001 EIN# 04-1423320

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES

Schedule H, Line 4j - Schedule of Reportable Transactions Plan Year Ending August 31, 2022

PLAN NO. 001 EIN# 04-1423320

HARVARD CLUB OF BOSTON RETIREMENT PLAN FOR EMPLOYEES PLAN SPONSOR'S EIN:04-1423320 PLAN NUMBER:001

374COMMONWEALTHAVENUE BOSTON,MA02215 PLANYEARENDINGAUGUST31,2022

ScheduleH,Line4j-SCHEDULEOFREPORTABLETRANSACTIONS

Represents a series of transactions with same broker in excess of 5%of the plan market value as of September 1, 2021:

Represents a series of transactions in securities of the same issue in excess of 5%of the plan market value as of September 1, 2021:

THE HIGGINSON 1908 FOUNDATION, INC.

Financial Statements for the years ended June 30, 2022 and 2021

(With Independent Accountants’ Compilation Report)

Independent Accountants’ Compilation Report

To the Board of Directors of The Higginson 1908 Foundation, Inc.

Management is responsible for the accompanying financial statements of The 1908 Higginson Foundation, Inc. (a nonprofit organization), which comprise the statements of financial position as of June 30, 2022 and 2021, and the related statements of activities and changes in net assets and cash flows for the years then ended, and the related notes to the financial statements in accordance with accounting principles generally accepted in the United States of America. We have performed compilation engagements in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the AICPA. We did not audit or review the financial statements nor were we required to perform any procedures to verify the accuracy or completeness of the information provided by management. We do not express an opinion, a conclusion, nor provide any form of assurance on these financial statements.

December 14, 2022

Telephone: (617) 753-9985 | Fax: (617) 753-9986

Email: info@pkfjnd.com | Website: www.pkfjnd.com PKF JND, P.C. | 75 State Street | Boston | Massachusetts 02109 | US

THE HIGGINSON 1908 FOUNDATION, INC.

Statement of Activities and Changes in Net Assets

For the Year Ended June 30, 2022

(See Independent Accountants' Compilation Report)

THE HIGGINSON 1908 FOUNDATION, INC.

Statement of Activities and Changes in Net Assets

For the Year Ended June 30, 2021

(See Independent Accountants' Compilation Report)

THE HIGGINSON 1908 FOUNDATION, INC.

Notes to Financial Statements

(See Independent Accountants' Compilation Report)

Note 1 – Organization

The Higginson 1908 Foundation, Inc. (the "Foundation"), a charitable corporation, was organized under the laws of the Commonwealth of Massachusetts in 2015. The Foundation’s purpose is to:

 Preserve and protect old and historic buildings in and around Boston, Massachusetts, including specifically the Clubhouse of the Harvard Club of Boston (the “Club”), in order to perpetuate the further education of posterity with regard to the architectural, historic, and general cultural heritage of the Boston area.

 Preserve and protect historically significant artwork exhibited in and around Boston, Massachusetts, in order to perpetuate the further education of posterity with regard to the arts.

 Encourage education and personal advancement for youth in the Greater Boston area.

 Foster scientific, literary and educational interests among members of the Club and to advance the interests and promote the welfare of Harvard University.

The Foundation’s fundraising activities consist primarily of the solicitation of Club members by direct mailings and an annual solicitation by the Club.

Note 2 – Summary of significant accounting policies

Basis of accounting

The Foundation prepares its financial statements in accordance with accounting principles generally accepted in the United States of America, which includes the application of accrual accounting. Consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred.

Classification and reporting of net assets

Accounting principles generally accepted in the United States of America require the Foundation to report information regarding its financial position and activities according to the following net asset classifications:

Net assets without donor restrictions: Net assets that are not subject to donor-imposed restrictions and may be expended for any purpose in performing the primary objectives of the organization. These net assets may be used at the discretion of the Foundation’s Board of Directors.

Net assets with donor restrictions: Net assets subject to stipulations imposed by donors, and grantors. Some donor restrictions are temporary in nature; those restrictions will be met by actions of the Foundation or by the passage of time; other donor restrictions are perpetual in nature, whereby the donor has stipulated funds be maintained in perpetuity.

Donor restricted contributions are reported as increases in net assets with donor restrictions if they are received with donor stipulations that limit the use of the donated assets. When a donor restriction expires, that is, when a stipulated time restriction ends, or purpose restriction is accomplished, net assets with donor restrictions are reclassified to net assets without donor restrictions and reported in the Statements of Activities and Changes in Net Assets as net assets released from restrictions.

THE HIGGINSON 1908 FOUNDATION, INC.

Notes to Financial Statements

(See Independent Accountants' Compilation Report)

Cash

The Foundation considers all unrestricted highly liquid investments with an initial maturity of three months or less to be cash equivalents.

Contributions

The Foundation recognizes contributions when cash, securities or other assets; an unconditional promise to give; or a notification of a beneficial interest is received. Conditional promises to give, that is, those with a measurable performance or other barrier and a right of return, are not recognized until the conditions on which they depend have been met.

Income taxes

The Internal Revenue Service has determined that the Foundation qualifies as an exempt organization under Internal Revenue Code Section 501(c)(3). In addition, the Foundation qualifies for the charitable contribution deduction under Section 170 (b)(1)(A) and has been classified as an organization that is not a private foundation under Section 509(a)(2).

The Income Taxes topic of the FASB Accounting Standards Codification prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Management of the Foundation has evaluated its tax positions and does not believe that any material uncertain tax positions exist. The Foundation’s policy is to record interest expense and penalties, if any, in management and general expenses. For the years ended June 30, 2022 and 2021 there was no interest and penalties expense recorded.

The Foundation's tax returns are generally subject to examination by the Internal Revenue Service and the Commonwealth of Massachusetts for a period of three years from the date they are filed.

Functional expense allocations

The costs of program and supporting services activities have been summarized on a functional basis in the Statements of Activities and Changes in Net Assets, as well as by natural classification detail. Expenses that can be identified with a specific program or supporting service are charged directly to the program or supporting service. Expenses which apply to more than one functional category have been allocated based on estimates made by management.

Accounting estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

THE HIGGINSON 1908 FOUNDATION, INC.

Notes to Financial Statements

(See Independent Accountants' Compilation Report)

Note 3 – Liquidity and availability

Financial assets available for general expenditure, that is, without donor restrictions limiting their use, within one year of the Statements of Financial Position date, are comprised of the following as of June 30:

Note 4 – Net assets with donor restrictions

Net assets with donor restrictions are restricted for the following purposes at June 30, 2022 and 2021: Scholarships for Harvard College students from the greater Boston area; Harvard College Community Service fellowships; Internship programs; Harvard Prize Books to be awarded to outstanding high school juniors, appraisal and cataloguing of the art collection at the Harvard Club of Boston.

Note 5 – Related party transactions

The Club is a member owned social club located in Boston, Massachusetts. The Club’s primary purpose is to provide a social meeting place for its members. The Foundation has a special relationship with the Club, as the Club is expected to receive funds from the Foundation to preserve and protect the Club’s physical infrastructure as well as the cultural and artistic materials held by the Club. The Foundation remains an independent organization dedicated solely to its charitable and educational purposes. The Foundation’s operations are maintained separately from the Club’s operating activities and its assets are not available to the Club.

The Club provides administrative support staff to the Foundation, for which the Foundation reimburses the Club. The Club requests that its members donate funds to the Foundation. Donations collected by the Club are remitted to the Foundation. The Club accounts for the donations as agency transactions and does not reflect them in its financial statements. Donations reimbursable to the Foundation by the Club during 2022 and 2021 totaled approximately $159,000 and $93,000, respectively.

Note 6 – Risk and uncertainties

Beginning in January 2020, global financial markets have experienced, and continue to experience, significant volatility resulting from the spread of a virus known as COVID-19. The outbreak has had a material adverse effect on global, national and local economies, as well as on the Foundation’s operations by disrupting scheduled events. The potential impact of a pandemic, epidemic or outbreak of a contagious disease on the Foundation’s operations is difficult to predict, and could have a material adverse effect on the Foundation’s results of operations and financial condition.

Note 7 – Subsequent events

The Foundation has evaluated subsequent events and transactions through December 14, 2022, the date the financial statements were available to be issued. There were no events or transactions that occurred that would require recognition or disclosure in the financial statements.

THANK YOU FOR YOUR SUPPORT. THE FUTURE IS BRIGHT FOR OUR HCB COMMUNITY.