KANSAS CITY AREA LIFE SCIENCES INSTITUTE, INC. FINANCIAL STATEMENTS

Transcription

1 FINANCIAL STATEMENTS Years Ended December 31, 2014 and 2013

2 Mayer Hoffman McCann P.C. An Independent CPA Firm 700 West 47th Street, Suite 1100 Kansas City, MO Main: Fax: INDEPENDENT AUDITORS' REPORT To the Board of Directors KANSAS CITY AREA LIFE SCIENCES INSTITUTE, INC. We have audited the accompanying financial statements of Kansas City Area Life Sciences Institute, Inc., which comprise the statements of assets and net assets - modified cash basis as of December 31, 2014 and 2013 and the related statements of revenues, expenses, and changes in net assets - modified cash basis, and functional expenses - modified cash basis for the years then ended, and the related notes to the financial statements. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the modified cash basis of accounting described in Note 1; this includes determining that the modified cash basis of accounting is an acceptable basis for the preparation of the financial statements in the circumstances. Management is also responsible 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. Auditor's Responsibility Our responsibility is to express an opinion on these financial 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 audits to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the 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 financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the assets and net assets of Kansas City Area Life Sciences Institute, Inc. as of December 31, 2014 and 2013, and the changes in net assets for the years then ended, in accordance with the modified cash basis of accounting as described in Note 1. Basis of Accounting We draw attention to Note 1 of the financial statements, which describes the basis of accounting. The financial statements are prepared on the modified cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to that matter. Kansas City, Missouri 1Af\ ~ I 1 0. f'(i_a. l'a ;--/ /1)1/_c (1tvlA0 ~ C. June 26, 2015 V ~ \ d _ kji 'f-t't!vl vv l -1- Member of Kreston International a global network of independent accounting firms -1-

3 STATEMENTS OF ASSETS AND NET ASSETS MODIFIED CASH BASIS December 31, 2014 and 2013 A S S E T S CASH AND CASH EQUIVALENTS $ 1,515,155 $ 1,282,706 PROPERTY AND EQUIPMENT, at cost, less accumulated depreciation 9,470 14,347 TOTAL ASSETS $ 1,524,625 $ 1,297,053 N E T A S S E T S UNRESTRICTED $ 804,625 $ 632,053 TEMPORARILY RESTRICTED 720, ,000 TOTAL NET ASSETS $ 1,524,625 $ 1,297,053 See Notes to Financial Statements -2-

4 STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN NET ASSETS MODIFIED CASH BASIS Years Ended December 31, 2014 and 2013 UNRESTRICTED NET ASSETS SUPPORT AND REVENUE Grants and contributions $ 659,596 $ 1,145,400 Annual events 197, ,650 Interest and other income 1, Net assets released from restrictions 721, ,000 TOTAL UNRESTRICTED SUPPORT AND REVENUE 1,580,566 1,551,169 EXPENSES Program services 1,061,004 1,225,105 Fundraising 108,472 99,880 Management and general 238, ,695 TOTAL EXPENSES 1,407,994 1,540,680 CHANGES IN UNRESTRICTED NET ASSETS 172,572 10,489 TEMPORARILY RESTRICTED NET ASSETS Temporarily restricted contributions 776, ,000 Net assets released from restriction (721,414) (200,000) CHANGES IN TEMPORARILY RESTRICTED NET ASSETS 55, ,000 CHANGES IN NET ASSETS 227, ,489 NET ASSETS, BEGINNING OF YEAR 1,297, ,564 NET ASSETS, END OF YEAR $ 1,524,625 $ 1,297,053 See Notes to Financial Statements -3-

5 STATEMENT OF FUNCTIONAL EXPENSES MODIFIED CASH BASIS Year Ended December 31, 2014 Program Management Total Services Fundraising and General All Funds Salaries $ 286,956 $ 75,038 $ 117,365 $ 479,359 Payroll taxes and benefits 54,722 19,650 26, ,814 Total salary and benefits 341,678 94, , ,173 Annual Meeting and Animal Health Symposium 92, ,294 Assay Depot 50, ,000 BioResearch Central Summit 10, ,631 Heartland Civic Collaboration 13, ,000 Honoraria 22, ,250 Infrastructure and technology 1,187-7,601 8,788 Marketing and advertising 44,779 1,914 7,617 54,310 Meetings 6,962-1,289 8,251 Memberships and dues 11,156-3,316 14,472 Miscellaneous ,167 13,983 Occupancy and office maintenance 17,599 8,916 19,481 45,996 Portal development and implementation 10, ,280 Postage 1, ,316 Printing and subscriptions 8, ,424 10,353 Professional fees 46,689-24,820 71,509 Research development grant awards 349, ,619 STEAM 10, ,007 Supplies 247-3,187 3,434 Telephone 4,502 2,700 4,678 11,880 Travel 17,572-2,999 20,571 TOTAL EXPENSES BEFORE DEPRECIATION 1,061, , ,641 1,403,117 Depreciation - - 4,877 4,877 TOTAL FUNCTIONAL EXPENSES $ 1,061,004 $ 108,472 $ 238,518 $ 1,407,994 See Notes to Financial Statements -4-

6 STATEMENT OF FUNCTIONAL EXPENSES MODIFIED CASH BASIS Year Ended December 31, 2013 Program Management Total Services Fundraising and General All Funds Salaries $ 274,623 $ 71,279 $ 111,838 $ 457,740 Payroll taxes and benefits 50,336 16,134 24,776 91,246 Total salary and benefits 324,959 87, , ,986 Annual Meeting and Animal Health Symposium 98, ,694 BioResearch Central Summit 23, ,428 Honoraria 6, ,500 Human Health Research Symposium 3, ,281 Infrastructure and technology 1,380-13,385 14,765 Marketing and advertising 137, ,721 Meetings 4, ,846 Memberships and dues 11,926-5,167 17,093 Miscellaneous 3, ,397 10,705 Occupancy and office maintenance 16,582 8,407 19,237 44,226 Portal development and implementation 15,350-3,725 19,075 Postage 1, ,443 Printing and subscriptions 11,112 1,274 3,034 15,420 Professional fees 138,554-12, ,172 Research development grant awards 399, ,334 Supplies 1,560-2,751 4,311 Telephone 4,924 2,710 4,229 11,863 Travel 20,913-1,466 22,379 TOTAL EXPENSES BEFORE DEPRECIATION 1,225,105 99, ,257 1,535,242 Depreciation - - 5,438 5,438 TOTAL FUNCTIONAL EXPENSES $ 1,225,105 $ 99,880 $ 215,695 $ 1,540,680 See Notes to Financial Statements -5-

7 NOTES TO FINANCIAL STATEMENTS (1) Summary of significant accounting policies Nature of operations - The Kansas City Area Life Sciences Institute, Inc. is a Missouri not-forprofit corporation formed in The Institute exists to promote and foster development of the life sciences and to provide a platform for development and cooperation in the area of life sciences in the Kansas City region. Recognition of donor restricted contributions - All grants and contributions are considered to be available for unrestricted use unless specifically restricted by the donor. Support that is restricted by the donor is reported as an increase and a release in temporarily restricted net assets if the restriction expires in the reporting period in which the support is recognized. In addition, the Institute holds an annual dinner with varying levels of sponsorships and individual tickets. Annual dinner revenue is recognized when funds have been received. Restricted net assets - Temporarily restricted net assets are net assets subject to donorimposed restrictions that will be met by actions of the Institute or the passage of time. Temporarily restricted net assets are available for the following purposes or periods: Temporarily restricted net assets Research grant program $ 170,000 $ 365,000 Strategic assessment 350,000 - Future period operational support 200, ,000 Total temporarily restricted net assets $ 720,000 $ 665,000 Use of estimates - The preparation of financial statements in conformity with the modified cash basis of accounting 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 reporting period. Actual results could differ from those estimates. Basis of accounting - The accompanying financial statements have been prepared on the modified cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Under this method of accounting, property and equipment is capitalized as an asset on the statements of assets and net assets modified cash basis, and depreciation expense and gains and losses on disposal of property and equipment are recorded on the statement of revenues, expenses and changes in net assets. All other elements of the financial statements are maintained on the cash basis of accounting. Cash and cash equivalents - Cash and cash equivalents consist of cash on hand and money market fund accounts with financial institutions. At times, the Institute maintains deposits in financial institutions in excess of federally insured limits. Management monitors the soundness of these financial institutions and believes the Institute s risk is negligible. Property and equipment Furniture and fixtures, and office equipment are stated on the basis of cost or fair market value on the date of donation. Depreciation is computed by the straight-line method over the following useful lives: Assets Furniture and fixtures Office equipment Estimated Useful Lives 7 years 3-5 years -6-

8 NOTES TO FINANCIAL STATEMENTS (1) Summary of significant accounting policies (continued) Taxes - Kansas City Area Life Sciences Institute, Inc. has been granted an exemption from income taxes by the Internal Revenue Service under the provisions of Section 501(c)(3) of the Internal Revenue Code. There was no unrelated business income during 2014 or 2013 for the Institute. The Institute has evaluated the standards requiring disclosure of uncertain tax positions under FASB ASC 740, Income Taxes, and determined that there are no material matters which merit disclosure. Functional expenses - The Institute allocates its expenses on a functional basis among its various programs and support services. Expenses that can be identified with a specific program and support service are allocated directly according to their natural expenditure classification. Other expenses that are common to several functions are allocated by management's estimate of resources devoted to the program or support service. During the years ended December 31, 2014 and 2013, the Institute had expenses related to annual events. These expenses are recorded on the statement of functional expenses modified cash basis as programmatic services. The following schedules are representative of the expenses incurred related to these events: For the Year Ended December 31, 2014: Annual Meeting and Animal Health Symposium Event food and drinks 54,281 BioResearch Central Summit Total $ $ 64,562 $ 10,281 Multimedia and advertising 8, ,107 Event space rental 22,229-22,229 Event decorations 5,052-5,052 Miscellaneous 1,975-1,975 Total event expenses $ 92,294 $ 10,631 $ 102,925 For the Year Ended December 31, 2013: Annual Meeting and Animal Health Symposium Human Health Research Symposium BioResearch Central Summit Total Event food and drinks $ 42,416 $ 581 $ 2,810 $ 45,807 Event space rental 24,310-13,322 37,632 Multimedia and advertising 23,002 2,700 6,050 31,752 Miscellaneous 8,966-1,246 10,212 Total event expenses $ 98,694 $ 3,281 $ 23,428 $ 125,403-7-

9 (2) Property and equipment KANSAS CITY AREA LIFE SCIENCES INSTITUTE, INC. NOTES TO FINANCIAL STATEMENTS Cost Furniture and fixtures $ 74,349 $ 74,349 Office equipment 37,212 37,212 Total cost 111, ,561 Accumulated depreciation (102,091) (97,214) Net property and equipment $ 9,470 $ 14,347 The aggregate depreciation charged to operations for the years ended December 31, 2014 and 2013, was $4,877 and $5,438, respectively. (3) Operating leases The Institute leases certain office space under an operating lease through December 31, Future minimum rental payments required under operating leases that have initial or remaining noncancellable lease terms in excess of one year are as follows: Year Ending December 31, 2015 $ 35, ,665 Total $ 71,330 Total rental expense under operating leases with a term in excess of one month amounted to $35,665 and $35,966 for the years ended December 31, 2014 and 2013, respectively. (4) Subsequent events The Institute has evaluated subsequent events through June 26, 2015, which is the date the financial statements were available to be issued. No events occurred that require disclosure in the financial statements or footnotes. -8-