The financial statements of the Ford Foundation, a Michigan nonprofit corporation, begin on page 58.

Transactions during the fiscal year ended September 30, 1966 featured continued disposition of the Foundation's principal asset, class A nonvoting stock in the Ford Motor Company, and further diversification of the investment portfolio.

Income and Expenses

The Foundation's income was $157,440,736, compared to $145,406,691 in fiscal 1965. The increase was due mainly to higher interest rates available on fixed-income securities in the money market during the year and to a change in the dividend rate on Ford Motor Company stock from $2 per share to $2.40 beginning December 1, 1965; dividends from the stock were $89,361,502, or 56.8 per cent of income.

Administrative expenses totaled $8,150,573. Investment expenses, totaling $388,227, are not included in this amount but are deducted from investment income.

Grants and Project Expenditures

The total of grants approved, plus expenditures on projects which are actively administered by the Foundation itself was $354,006,530, or $204,716,367 more than net income after expenses. The cumulative excess of expenses, grants approved, and project expenditures over income since the establishment of the Foundation in 1936 thus increased to $1,052,251,965, as shown below. The second column is stated on an accrual basis; the last column indicates activity on a cash basis.

Sources and Application of Funds

Financial data in this report are based on the accrual method of accounting, under which income in a given year is included when earned even if not collected, and grants and incurred expenses are included even if not paid within the period. Grants frequently are scheduled for payment over varying periods in future years. To depict the sources and use of funds, the table on the next page summarizes the movements of cash during fiscal 1966.

Income, Expenses, Grants, and Project Expenditures 1936-1966 (in millions)