THEATRE MEMPHIS COMBINED FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION JUNE 30, 2014 AND 2013

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1 COMBINED FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION JUNE 30, 2014 AND 2013

2 COMBINED FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

3 CONTENTS Page FINANCIAL STATEMENTS Independent Auditor's Report Combined Statements offinancial Position Combined Statements of Activities Combined Statements of Cash Flows Notes to Combined Financial Statements SUPPLEMENTARY INFORMATION Combining Statements offinancial Position Combining Statements of Activities

4 Whitehorn Tankersley & ~ Davis, PLLC CERTIFIED PUBLIC ACCOUNTANTS (90 1) 670 Oakleaf Office Lane Memphis, TN (901) FAX INDEPENDENT AUDITOR'S REPORT To The Board of Directors Theatre Memphis Memphis, Telll1essee We have audited the accompanying combined financial statements oftheatre Memphis (a nonprofit organization) which comprise the combined statements of financial position as of June 30, 2014 and 2013, and the related combined statements of activities and cash flows for the years then ended, and the related notes to the combined financial statements. Management's Responsibility for tlte Financial Statements Management is responsible for the preparation and fair presentation of these combined financial statements in accordance with accounting principles generally accepted in the United States of America; this includes 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. Auditor's Responsibility Our responsibility is to express an opinion on these combined fmancial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the combined financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the combined financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements 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 entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the combined financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS AICPA DIVISION OF FIRMS: PRIVATE COMPANIES PRACTICE SECTION TENNESSEE SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS

5 2 Opinion In our opinion, the combined financial statements referred to above present fairly, in all material respects, the financial position oftheatre Memphis as ofjune 30, 2014 and 2013, 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. Other Matter Our audits were conducted for the purpose of forming an opinion on the combined financial statements as a whole. The combining statements of financial position and statements of activities on pages are presented for purposes of additional analysis and are not a required part ofthe financial statements. 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 combined financial statements. The information has been subjected to the auditing procedures applied in the audit of the combined financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the combined financial statements or to the financial statements themselves, and other procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the combined financial statements taken as a whole. November 20, 2014 Memphis, Tennessee

6 3 COMBINED STATEMENTS OF FINANCIAL POSITION ASSETS JUNE CURRENT ASSETS Cash and cash equivalents 0 Restricted cash Accounts receivable 0 Promises to give - current portion 0 Prepaid expenses 0 TOTAL CURRENT ASSETS $ 167, ,315 6, ,500 25, ,401 $ 37,091 2,062 39,153 5,471 32,484 23, ,516 PROMISES TO GIVE, less current portion ,000 53,666 PROPERTY AND EQUIPMENT - net of accumulated depreciation , ,099 TOTAL ASSETS $ 786,682 $ 551,281 LIABILITIES AND NET ASSETS CURRENT LIABILITIES Note payable bank - line of credit 0 Accounts payable 0 Accrued expenses 0 Deferred revenue 0 TOTAL CURRENT LIABILITIES 0 NET ASSETS Unrestricted Undesignated 0 Board designated 0 Temporarily restricted 0 TOTAL NET ASSETS $ 195,937 76, , ,427 (37,924) 174, , , ,255 $ 172,753 50, , ,320 57,007 57, , ,961 TOTAL LIABILITIES AND NET ASSETS $ 786,682 $ 551,281 See notes to combined financial statements

7 4 COMBINED STATEMENTS OF ACTIVITIES YEAR ENDED J UNE UNRESTRICTED NET ASSETS Support and revenue Support Revenue Interest income In-kind donations Total support and revenue Reclassifications Net assets released from restrictionssatisfaction of time and purpose restriction Total reclassifications Total support and revenue and reclassifications... Functional expenses before depreciation Progratn General and administrative Fundraising Total functional expenses before depreciation CHANGE IN UNRESTRICTED NET ASSETS BEFORE DEPRECIATION DEPRECIATION Program General and administrative Total depreciation.... CHANGE IN UNRESTRICTED NET ASSETS.... $ 773, ,020 24,346 1,477, ,541, , ,319 42,802 1,411, ,660 23, $ 718, , ,554 1,466, , ,202 1,590, , ,919 52,041 1,485, ,721 20,436 25, ,612 See notes to combined financial statements

8 5 COMBINED STATEMENTS OF ACTIVITIES- CONTINUED YEAR ENDED JUNE TEMPORARILY RESTRICTED NET ASSETS Support and revenue Support $ Total support and revenue Reclassifications Net assets released from restrictions Total reclassifications CHANGE IN TEMPORARILY RESTRICTED NET ASSETS CHANGE IN NET ASSETS NET ASSETS - beginning of year NET ASSETS- end of year $ 173,380 $ 173,380 (63,300) (63,300) 110, , , ,255 $ 25,000 25,000 (124,202) (124,202) (99,202) (40,590) 202, See notes to combined financial statements

9 6 COMBINED STATEMENTS OF CASH FLOWS YEAR ENDED JUNE CASH FLOWS FROM OPERATING ACTIVITIES Cash received from contributors and grantors Cash received from customers and others Cash paid to suppliers and employees Income taxes paid Interest and dividends received Interest paid NET CASH PROVIDED BY OPERATING ACTIVITIES $ 825,484 $ 675,476 (1,356,271) (147) (6,936) , ,078 (1,477,413) (608) 8 (7,546) CASH FLOWS FROM INVESTING ACTIVITIES Payments for purchase of furniture and equipment 0 NET CASH (USED) BY INVESTING ACTIVITIES CASH FLOWS FROM FINANCING ACTIVITIES Net proceeds (payments) on line of credit ,184 Payments on notes payable and long-term debt NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES ,162 NET CHANGE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR (30,628) (30,628) (52,916) (52,916) 60,000 (74,881) (14,881) 1, CASH AND CASH EQUIVALENTS AT END OF YEAR $ 169,315 :!:$===3=9="=,1=5=3 See notes to combined financial statements

10 7 COMBINED STATEMENTS OF CASH FLOWS -CONTINUED RECONCILIATION OF CHANGE IN NET ASSETS TO NET CASH PROVIDED BY OPERATING ACTIVITIES YEAR ENDED JUNE CHANGE IN NET ASSETS... $ 189,294 $ (40,590) ADJUSTMENTS TO RECONCILE CHANGE IN NET ASSETS TO NET CASH PROVIDED BY OPERATING ACTIVITIES Depreciation Loss on disposal of fixed asset (Increase) decrease in assets: Accounts receivables Promises to give.... Prepaid expenses.... Increase (decrease) in liabilities: Accounts payable and accrued expenses.... Deferred revenue.... NET CASH PROVIDED BY OPERATING ACTIVITIES ,446 46, (1, 149) 27,484 (121,350) 66,800 (2,558) (9,218) 26,318 (20,357) (3,395) (1,475) $ 137,606 $ 69,376 See notes to combined financial statements

11 8 NOTES TO COMBINED FINANCIAL STATEMENTS YEARS ENDED JUNE 30,2014 AND 2013 NOTE 1 -DESCRIPTION OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES DESCRIPTION OF ACTIVITIES- Theatre Memphis ("Theatre") located in Memphis, Tennessee, was organized in 1920 under the laws of Tennessee for the purpose of providing outstanding theatrical experiences to enrich the lives of our audiences and participants through the production of plays, outreach and educational programming. BASIS OF ACCOUNTING - The financial statements of the Theatre have been prepared on the accrual basis of accounting, in accordance with accounting principles generally accepted in the United States of America and include the combined accounts of Theatre Memphis and Stage Set, a related supporting agency ofthe Theatre. All significant inter-agency balances have been eliminated. Financial statement presentation follows the recommendations of the Financial Accounting Standards Board Accounting Standards Codification ("F ASB ASC") Not-for-Profit Organizations - Presentation of Financial Statements. The Theatre reports information regarding its financial position and activities according to three classes of net assets: unrestricted net assets, temporarily restricted net assets and permanently restricted net assets. Temporarily restricted net assets at each year end are generally available for use during future fiscal years. RESTRICTED CASH- Restricted cash represents monies which were received to provide theatrerelated performers and their families with assistance in the payment of medical bills. As these monies were given for a specific purpose, they are restricted for use solely for that purpose. PROMISES TO GIVE- Unconditional promises to give are recognized as revenues or gains in the period received and as assets, decreases of liabilities, or expenses depending upon the form of the benefits received. Conditional promises to give are recognized when the conditions on which they depend are substantially met. The Theatre uses the allowance method to determine uncollectible unconditional promises receivable. The allowance, if any, is based upon prior years' experience and management's analysis of specific promises made. No allowance was considered necessary at June 30,2014 or CASH AND CASH EQUIVALENTS- The Theatre considers all cash accounts, which are not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with initial maturities of three months or less to be cash equivalents. PROPERTY AND EQUIPMENT- Property and equipment purchased are recorded at cost. Donated furniture and equipment are recorded at their estimated fair market values at the date of receipt. Expenditures for additions, major renewals and betterments greater than $1,000 are capitalized and those for maintenance and repairs are charged to expense as incurred. Depreciation is computed on the straight-line basis over the estimated useful life of the depreciable assets.

12 9 NOTES TO COMBINED FINANCIAL STATEMENTS- CONTINUED YEARS ENDED JUNE 30, 2014 AND 2013 NOTE 1 - DESCRIPTION OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED MARKETING COSTS - Marketing costs are generally expensed in the year incurred and totaled $51,433 (in-kind $21,667) and $66,947 (in-kind $24,754) for the years ended June 30, 2014 and 2013, respectively. ESTIMATES - The presentation 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 of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. REVENUE RECOGNITION AND CONTRIBUTED SUPPORT- Support received is recorded as unrestricted, temporarily restricted, or permanently restricted revenue depending on the existence and/or nature of any donor restrictions. Accordingly, the Theatre has elected to show restricted contributions whose restrictions are met in the same reporting period as unrestricted support. Contributions that are subject to time or use restrictions are required to be reported as temporarily restricted support and are then reclassified to unrestricted net assets upon expiration of the restrictions. BARTER TRANSACTIONS- The Theatre generally enters into several barter transactions. The substance of these transactions is that the Theatre receives print advertising in exchange for performance admissions and advertising in the Theatre's program. IN-KIND DONATIONS- In-kind donations are recognized at their fair market value if they (a) create or enhance long-lived assets or (b) require specialized skills, are provided by individuals possessing those skills, and would typically need to be purchased if not provided by donation. Additionally, the Theatre receives a significant amount of contributed time from general volunteers. The value of the general volunteer contributed time has not been determined and is not reflected in the accompanying financial statements since it does not meet the two recognition criteria described above. DEFERRED REVENUE- Subscriptions are recognized as revenues during the fiscal year that coincides with the play season. Subscriptions remitted in advance of the play season are accounted for as deferred revenue. TAX STATUS - The Internal Revenue Service has issued a determination letter indicating that the Theatre qualifies as a tax-exempt organization under Section 501 ( c )(3) ofthe Internal Revenue Code. It has been classified as an organization that is not a private foundation under Section 509 (a)(2) of the Internal Revenue Code. The Theatre follows the provisions offasb ASC , Accounting for Income Taxes, which requires the computation of any current income tax assets or liabilities only

13 10 NOTES TO COMBINED FINANCIAL STATEMENTS - CONTINUED YEARS ENDED JUNE 30, 2014 AND 2013 NOTE 1 - DESCRIPTION OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED TAX STA TUS- CONTINUED- consider tax positions that are more likely than not (defined as a greater than 50% chance) to be sustained if the taxing authorities examined the positions. The Theatre is subject to income tax examination by taxing authorities for years ending after June 30, CONCENTRATIONS- The Theatre maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Theatre has not experienced any losses in such accounts nor does management of the Theatre believe there is any significant credit risk on cash and cash equivalents. The Theatre is supported primarily through donor contributions (including board members and management), government grants, ticket sales and local arts council funding. The local arts council funding comprised approximately 23% and 15% of the Theatre's total revenue and support for the years ended June 30, 2014 and 2013, respectively. The Theatre depends heavily on grants and contributions for its revenue. The ability of the Theatre's grantors and contributors to continue making grants comparable to the present level depends upon many factors, including current and economic conditions. While the Theatre's board of directors believes it has the resources to continue its programs, its ability to do so and the extent to which it continues may be dependent upon the above factors. SUBSEQUENT EVENTS - The Theatre management evaluates subsequent events through the auditor's report date, which is the date the financial statements are available for issuance. RECLASSIFICATIONS- For comparability, certain prior year amounts have been reclassified where appropriate to conform with the financial statement presentation in the current year. NOTE 2- FAIR VALUE MEASUREMENTS FASB ASC , Fair Value Measurements, establishes a fair value hierarchy that prioritizes the inputs for valuation techniques used to measure fair value. This hierarchy consists of three broad levels. Levell inputs are based on unadjusted quoted market prices within active markets. Level2 inputs are based on quoted prices for similar assets in active or inactive markets. Level 3 inputs are all other financial instruments without an active market or inactive market and for which no significant observable inputs are available. No Level 1 or 2 inputs were available to the Theatre.

14 11 NOTES TO COMBINED FINANCIAL STATEMENTS - CONTINUED YEARS ENDED JUNE 30, 2014 AND 2013 NOTE 2- FAIR VALUE MEASUREMENTS- CONTINUED Fair values of assets measured on a recurring basis at June 30, 2014 and 2013 are as follows: June 30, 2014 Promises to give Fair Value $ 207,500 Fair Value Measurements at Reporting Date Using Significant Unobservable Inputs (Level 3) $ 207,500 Total $ 207,500 June 30, 2013 Promises to give $ 86,150 Total $ 86,150 $ 207,500 $ 86,150 $ 86,150 All assets above have been valued using a market value approach and there have been no changes in valuation techniques and related inputs. The reconciliation of the changes in unconditional promises to give at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows: Unconditional Promises to Give Balance, July 1, Contributions and collections (net).... Balance, June 30, Contributions and collections (net) Balance, June 30, $ 152,950 (66,800) 86, ,350 $ 207,500

15 12 NOTES TO COMBINED FINANCIAL STATEMENTS- CONTINUED YEARS ENDED JUNE 30,2014 AND 2013 NOTE 3 - PROMISES TO GIVE Unconditional promises to give comprised the following: JUNE ArtsMemphis pledge ArtsMemphis challenge pledges Debt elimination pledges Other $ 100,000 68,500 37,000 2,000 $ 74,500 11,650 Total promises to give $ 207,500 $ 86,150 At June 30, 2014, promises to give are due as follows: YEAR ENDING JUNE AMOUNT $ 173,500 31,000 3,000 $ 207,500 The Theatre received an Enhancement Grant from ArtsMemphis which requires the Theatre to obtain a matching amount of$1 00,000 by November 30, 2014 and an additional $100,000 by November 30, 2015, through either payments or pledges. The grant provides $200,000 to be paid in two annual payments of $100,000 upon the Theatre securing such funds. As of June 30, 2014 the Theatre had met the first match of $100,000 and, accordingly, recognized this amount as revenue in the accompanying financial statements. The remaining amount of$1 00,000 is considered a conditional promise to give and is not recognized as revenue until the condition on which it depends is substantially met (i.e., the Theatre secures payment or pledges of$100,000). At June 30,2014, the Theatre had obtained matching pledges approximating $40,000 related to the second $100,000 amount under this grant.

16 13 NOTES TO COMBINED FINANCIAL STATEMENTS- CONTINUED YEARS ENDED JUNE 30, 2014 AND 2013 NOTE 4 -PROPERTY AND EQUIPMENT Property and equipment consist ofthe following major classifications: JUNE Building and improvements $ 2,224,798 $ 2,216,423 Marquee ,150 59,150 Production equipment , ,739 Furniture, fixtures and equipment , ,928 Heating and air conditioning equipment ,323 78,323 Vehicle ,292 20,292 Ticketing system ,020 57,020 2,918,503 2,887,875 Accumulated depreciation (2,541,222) (2,490, 776) $ 377,281 $ 397,099 Depreciation expense for the years ended June 30, 2014 and 2013 totaled $50,446 and $46,109, respectively. NOTE 5 - INDEBTEDNESS LINE OF CREDIT- The Theatre maintains a $200,000 renewable, unsecured revolving line of credit from a local bank. The line bears interest at the bank's base rate plus seventy-five basis points, but not less than 4% per annum, with interest payable monthly and expires March 6, There was $195,937 and $172,753 payable on the line of credit as of June 30, 2014 and 2013, respectively. Interest expense for the years endedjune30, 2014 and2013, totaled $6,936 and $7,546, respectively.

17 14 NOTES TO COMBINED FINANCIAL STATEMENTS - CONTINUED YEARS ENDED JUNE 30, 2014 AND 2013 NOTE 6 - NET ASSETS Temporarily restricted net assets comprised the following: JUNE Arts Memphis challenge Promises to give- debt elimination.... Jeniam Foundation Bernsen scholarships $ 168,500 37,000 5, $ 74,500 26, $ 215,034 $ 104,954 Board designated net assets represent those amounts identified for the operating reserve fund. These funds are intended to be used to sustain operations under various situations and in compliance with the Theatre's new operating reserve fund policy. NOTE 7- IN-KIND DONATIONS AND BARTER TRANSACTIONS The Theatre records in-kind donations received in the course of daily operations. The Theatre is built on land leased from the Memphis Park Commission for $1,200 per year until No amounts have been recognized in the statement of activities for the fair value of the Theatre' s use of the land because the value is not readily determinable. The amounts reflected in the accompanying financial statements as in-kind donations of $24,346 and $29,554 for 2014 and 2013, respectively, are offset by $24,346 and $29,554, for 2014 and 2013, respectively, in expenses. In-kind donations comprised the following: JUNE Advertising and marketing $ 21,667 $ 24,754 Other , $ 24,346 $ 29,554

18 15 NOTES TO COMBINED FINANCIAL STATEMENTS - CONTINUED YEARS ENDED JUNE 30, 2014 AND 2013 NOTE 8 - LEASE COMMITMENTS The Theatre leases the land on which its building is located under an operating lease from the Memphis Park Commission. The lease provides for monthly rent payments and expires December 31, 2069 ($66,600 total remaining payments). The Theatre also leases various office equipment under operating leases which expire in various years through June 30, Future minimum lease payments under the operating leases with an initial lease term of one year or greater are as follows: YEAR ENDING JUNE Thereafter AMOUNT $ 11,772 9,645 7,800 1,750 61,200 Total $ 92,167 Rent expense totaled $16,999 and $18,675 in 2014 and 2013, respectively. NOTE 9- RETIREMENT PLAN The Theatre sponsors a 401(k) Qualified Retirement Plan to provide retirement benefits for employees who meet certain eligibility requirements. There was no retirement benefit expense for years ended June 30, 2014 and NOTE 10- INCOME TAXES The Theatre's advertising revenue is considered unrelated to its exempt purpose; accordingly, the Theatre is subject to federal and state income tax on this net unrelated business income. The Theatre incurred $726 and $608 in tax expense for years ended June 30, 2014 and 2013, respectively.

19 16 NOTES TO COMBINED FINANCIAL STATEMENTS - CONTINUED YEARS ENDED JUNE 30, 2014 AND 2013 NOTE 10- INCOME TAXES- CONTINUED Total income tax liability and expense is as follows: 2014 Liability (Prepaid) Expense Federal $ 433 $ 433 State Franchise and Excise $ 579 $ Liability (Prepaid) Expense Federal $ (250) $ 461 State Franchise and Excise $ (250) $ 608 NOTE11 -GRANT Jeniam II, a local private foundation, notified the Theatre of a grant to be annually awarded from a donor advised fund at the Community Foundation of Greater Memphis which was combined with a previously established donor advised fund at ArtsMemphis. The fund is to distribute 5% of the principal to the Theatre annually for use in operations. The Theatre received $11,146 during 2014 from this grant. NOTE 12- RELATED PARTIES The Theatre normally receives contributions, sponsorships and ticket sales from members of its Board of Directors and management. Included in support and revenue in the accompanying statements of activities are approximately $125,000 and $91,000 of such support and revenue during 2014 and 2013, respectively. In addition, included in promises to give in the statement of financial position at June 30, 2014 and 2013 are $74,500 and $138,000 due from board members and/or management. At June 30, 2014 and 2013, $13,356 and $1,844 were payable to members of management for expenses paid on behalf of the Theatre.

20 SUPPLEMENTARY INFORMATION

21 17 COMBINING STATEMENT OF FINANCIAL POSITION JUNE 30,2014 General Fund Stage Set Total ASSETS CURRENT ASSETS Cash and cash equivalents Restricted cash Accounts receivable Promises to give - current portion.... Prepaid expenses Total Current Assets $ 163,746 1, ,609 6, ,500 25, ,695 $ 3,706 3,706 3,706 $ 167, ,315 6, ,500 25, ,401 PROMISES TO GIVE, less current portion ,000 34,000 PROPERTY AND EQUIPMENT - net of accumulated depreciation , ,281 TOTAL ASSETS $ 782,976 $ 3,706 $ 786,682 LIABILITIES AND NET ASSETS CURRENT LIABILITIES Note payable bank -line of credit.... Accounts payable Accrued expenses Deferred revenue Total Current Liabilities.... $ 195,937 76, , ,427 $ $ 195,937 76, , ,427 NET ASSETS Unrestricted Undesignated.... Board designated Temporarily restricted.... Total Net Assets.... (41,630) , , ,549 3,706 3,706 3,706 (37,924) , , ,255 TOTAL LIABILITIES AND NET ASSETS.. $ 782,976 $ 3,706 $ 786,682 See notes to combined financial statements

22 18 COMBINING STATEMENT OF FINANCIAL POSITION JUNE 30, 2013 General Fund Stage Set Total ASSETS CURRENT ASSETS Cash and cash equivalents Restricted cash Accounts receivable Promises to give - current portion Prepaid expenses Inventory Total Current Assets $ 32,170 2,062 34,232 5,471 32,484 23,408 95,595 $ 4,921 4,921 4,921 $ 37,091 2,062 39,153 5,471 32,484 23, ,516 PROMISES TO GIVE, less current portion ,666 53,666 PROPERTY AND EQUIPMENT - net of accumulated depreciation , ,099 TOTAL ASSETS $ 546,360 $ 4,921 $ 551,281 LIABILITIES AND NET ASSETS CURRENT LIABILITIES Note payable bank- line of credit Accounts payable Accrued expenses Current portion - long-term loan Deferred revenue Total Current Liabilities $ 172,753 50, , ,320 $ $ 172,753 50, , ,320 LONG-TERM DEBT, less current portion , ,320 NET ASSETS Unrestricted Temporarily restricted Total Net Assets , , ,040 4,921 4,921 57, , ,961 TOTAL LIABILITIES AND NET ASSETS.. $ 546,360 $ 4,921 $ 551,281 See notes to combined financial statements

23 19 COMBINING STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2014 General Stage Fund Set Total UNRESTRICTED NET ASSETS Support and revenue Support $ 769,374 $ 4,080 $ 773,454 Revenue , ,020 In-kind donations ,346 Total support and revenue ,080 1,477,820 Reclassifications ,300 63,300. Functional expenses before depreciation and inventory costs Program , ,339 General and administrative , ,319 Fundraising ,295 42,802 Total functional expenses 0 0 1,410,165 1,295 1,411,460 PERMANENT TRANSFERS (4,000) CHANGE IN UNRESTRICTED NET ASSETS BEFORE DEPRECIATION ,875 (1,215) 129,660 DEPRECIATION Program ,099 23,099 General and administrative Total depreciation CHANGE IN UNRESTRICTED NET ASSETS ,429 (1,215) TEMPORARILY RESTRICTED NET ASSETS Support and revenue and reclassifications Support , ,380 Reclassifications (63,300) (63,300) Total support and revenue and reclassifications , ,080 CHANGE IN TEMPORARILY RESTRICTED NET ASSETS , ,080 CHANGE IN NET ASSETS 0 NET ASSETS - beginning of year NET ASSETS - end of year 190, $ (1,215) 189, , , ,549 $ 3,706 $ 351,255 See notes to combined financial statements

24 20 COMBINING STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2013 General Stage Fund Set Total UNRESTRICTED NET ASSETS Support and revenue Support $ 718,464 $ $ 718,464 Revenue 0 715,886 2, ,039 Interest income In-kind donations ,554 29,554 Total support and revenue ,463,912 2,153 1,466,065 Reclassifications , ,202 Functional expenses before depreciation and inventory costs Program , ,586 General and administrative , ,9 19 Fundraising ,041 Total functional expenses 0 0 1,484, ,485,546 PERMANENT TRANSFERS (25) CHANGE IN UNRESTRICTED NET ASSETS BEFORE DEPRECIATION ,570 1, ,721 DEPRECIATION Program ,436 20,436 General and administrative ,673 25,673 Total depreciation CHANGE IN UNRESTRICTED NET ASSETS ,151 58,612 TEMPORARILY RESTRICTED NET ASSETS Support and revenue and reclassifications Support ,000 25,000 Reclassifications (124,202) (124,202) Total support and revenue and reclassifications (99,202) (99,202) CHANGE IN TEMPORARILY RESTRICTED NET ASSETS... (99,202) (99,202) CHANGE IN NET ASSETS NET ASSETS - beginning of year NET ASSETS - end of year (41,741) $ 1,151 (40,590) , ,040 $ 4,921 $ 161,961 See notes to combined financial statements