b'20187-20189 YEAR BOOKREADERS NOTE: In this section, we present summary financial information. Each year the Carnegie Institution, through the Audit committee of its Board of Trustees, engages an independent auditor to express an opinion about the financial statements and the financial position of the institution. The complete audited financial statements are made available on the institutions website at www.CarnegieScience.edu.67The Carnegie Institution for Science completed fiscal year 2019 in sound financial condition after generating a net return of 4.8% on the diversified investments within its endowment; maintaining a disciplined spending policy that balances todays needs with the long-term requirements of the institution and the interests of future scientists; and the continued support of organizations and individuals who recognize the value of basic science.The primary source of support for the institutions activities continues to be its endowment. This reliance on institutional funding provides an important degree of independence in the research activities of the institutions scientists.As of June 30, 2019, the endowment was valued at $966 million. Over the period 1998-2019, average annual distributions from the endowment to the budget were 5.0%. Carnegie closely controls expenses to ensure the continuation of a healthy scientific enterprise.For several years, under the direction of the Investment committee of the board, Carnegies endowment has been allocated among a broad spectrum of asset classes including: equities (stocks), absolute return investments, real estate partnerships, private equity, natural resources partnerships, and fixed-income instruments (bonds). The goal of this diversified approach is to generate attractive overall performance and reduce the volatility that would exist in a less diversified portfolio. In 2016 Carnegie hired its first Chief Investment Officer to more proactively steward the endowments assets.The Chief Investment Officer and Investment committee regularly examine the asset allocation of the endowment and readjust the allocation, as appropriate. The institution relies upon external managers and partnerships to conduct the investment activities, and it employs a commercial bank to maintain custody. The following chart shows the allocation of the institutions endowment among asset classes as of June 30, 2019. Asset Class Target ActualCommon Stock 38.0% 35.6%Alternative Assets 52.0% 56.3%Fixed Income and Cash 10.0% 8.1%'