SALON LITERARIO LIBROAMERICA EN PUERTO RICO, INC.

Transcription

1 SALON LITERARIO LIBROAMERICA EN PUERTO RICO, INC. FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017 AND ACCOUNTANT S COMPILATION REPORT ADVANCED CPA, LLC. PO BOX SAN JUAN PR (787) jnegron@negroncpa.com

2 INDEX Accountant s Compilation Report.... Page 1 Statement of Financial Position.... Page 2 Statement of Activities.... Page 3 Statement of Cash Flows.... Page 4 Statement of Functional Expenses.... Page 5 Notes to Financial Statements.... Page 6

3 ADVANCED CPA, LLC. Certified Public Accountants and Consultants ACCOUNTANT S COMPILATION REPORT Board of Directors Salón Literario LibroAmérica en Puerto Rico, Inc. San Juan, Puerto Rico We have compiled the accompanying statement of financial position of Salón Literario LibroAmérica en Puerto Rico, Inc. as of December 31, 2017, and the related statements of activities and changes in net assets and cash flows for the year then ended. We have not audited or reviewed the accompanying financial statements and, accordingly, do not express an opinion or provide any assurance about whether the financial statements are in accordance with accounting principles generally accepted in the United States of America. 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 designing, implementing, and maintaining internal control relevant to the preparation and fair presentation of the financial statements. Our responsibility is to conduct the compilation in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. The objective of a compilation is to assist management in presenting financial information in the form of financial statements without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements. Stamp of the Certified Public Accountant s Society of Puerto Rico was attached to the Original of this Report Advanced CPA, LLC. License #285 April 12, 2018 San Juan, Puerto Rico

4 Salón Literario LibroAmérica en PR, Inc. Statement of Financial Position As Of December 31, 2017 ASSETS 2007 Dec-17 CURRENT ASSETS Cash in banks $ 13,718 $ 10,143 Pledges Receivable - Other assets - TOTAL CURRENT ASSETS 13,718 10,143 TOTAL ASSETS #REF! $ 10,143 LIABILITIES AND NET ASSETS CURRENT LIABILITES Accounts Payable 200 $ 40,945 Credit Card Payable Note 3 12,780 Payroll Liabilities Note 4 47 Credit Line Payable Note 5 25,690 TOTAL CURRENT LIABILITES ,462 NET ASSETS $ 200 Unrestricted: Undesignated (112,820) Temporarily restricted 43,500 TOTAL NET ASSETS (69,320) TOTAL LIABILITIES AND NET ASSETS #REF! $ 10,143 See Accountant's Compilation Report and Notes to the Financial Statements. 2

5 Salón Literario LibroAmérica en PR, Inc. Statement of Activities For The Year Ended December 31, 2017 REVENUES Unrestricted Temporarily Restricted Permanently Restricted Total In-Kind Contributions $ - $ 12,000 $ 12,000 Donations & Support 13, , ,839 TOTAL REVENUES 13, , ,839 OPERATING EXPENSES Program Services Literary Festivals & Events 27, , ,356 Supporting Services - General and Administrative 6,008 18,640 24,648 Fundraising Activities , , ,004 CHANGE IN NET ASSETS $ (20,165) $ - $ - $ (20,165) NET ASSETS, beginning of year (92,655) 43,500 - (49,155) Prior Period Adjustment NET ASSETS, end of year $ (112,820) $ 43,500 $ (69,320) The Accompanying Notes Are An Integral Part Of This Financial Statement. 3

6 Salón Literario LibroAmérica en Puerto Rico, Inc. Statement of Cash Flows For the Year Ended December 31, 2017 CASH FLOWS FROM OPERATING ACTIVITIES Dec-17 Change in net assets $ (20,165) Adjustments to reconcile change in net assets to net cash provided by operating activities: Depreciation and amortization - Change in assets and liabilities: Accounts Receivable 43,500 Accounts payable (32,363) - Credit Card (11,981) Line of Credit (2,963) Payroll liabilities (5,651) Net cash used in operating activities (29,623) NET CHANGE IN CASH AND CASH EQUIVALENTS (29,623) CASH AND CASH EQUIVALENTS, beginning of year 39,766 CASH AND CASH EQUIVALENTS, end of year $ 10,143 See Accountants Compilation Report and notes to the financial statements. 4

7 Salón Literario LibroAmérica en PR, Inc. Statement of Functional Expenses For The Year Ended December 31, 2017 Unrestricted Temporarily Restricted Total Professional Services Expense $ 27,396 $ 48,653 $ 76,049 Program Services Awards Expense - - Publications Expense Instructors Expense - - Student Activities & Meals Expense - 13,072 13,072 Travel Expense - 42,235 42,235 Other Program Expenses - - General Administrative Expense Advertising & Fundraising Bank Charges Expense 1,108 1,108 Miscellaneous Expense Insurance Expense 208 3,415 3,623 Interest & Commissions Expense 1,937 1,937 Licences and Permits Expense 1,092 3,225 4,317 Maintenance & Repairs Expense - - Office & Supplies Expense Rent & Utilities Expense 0 12,000 12,000 TOTAL PROGRAM AND SUPPORT EXPENSES $ 33,404 $ 122,600 $ 156,004 The Accompanying Notes Are An Integral Part Of This Financial Statement. 5

8 Salón Literario LibroAmérica en PR, Inc. Notes to the Financial Statements As Of December 31, 2017 (See Accountant s Compilation Report) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: This summary of significant accounting policies of Salón Literario LibroAmérica en PR, Inc. (The Organization) is presented in order to assist in understanding the Company s financial statements. The financial statements and notes are a representation of the Company s management, who is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles and have been consistently applied in the preparation of the financial statements. Nature of Operations The Organization was organized in April 7, 2008, as a Not-for-Profit Corporation organized under the laws of the Commonwealth of Puerto Rico and has ever since engaged in promoting at Puerto Rico the analysis and discussion of Puerto Rican and foreign literature. The organization is a non-stock corporation. Its Board of Directors develops and promotes activities and requests contributions that will provide the necessary funds to support the operations. The main offices are located in San Juan, Puerto Rico. The accounting period starts on January 1 st and ends on December 31 st of each year. Basis for Earnings Recognition The accrual method of accounting is used to record revenues and expenses. Under this method, revenues are recognized when earned, and expenses are recorded when incurred. Cash and Cash Equivalents For purposes of reporting cash flows, the Organization considers all cash not subject to withdrawal restriction or penalties, certificates of deposit and other investments with original maturities of 90 days or less, to be cash or cash equivalents. Contributions The Organization also follows the provisions regarding accounting for contributions received and contributions made. Under this approach, contributions received are recorded as unrestricted, temporarily restricted, or permanently restricted net assets depending on the existence or nature of any donor restrictions. Income Tax The Puerto Rico Treasury Department granted the Organization, under Section 1101 (4) of the Puerto Rico Internal Revenue Code, as amended, exemption from the payment of income tax on the income and donors contributions it receives. The exemption also applies to the payment of other state and municipal taxes. Subject to compliance with the requirements of the Code, this exemption is for an indefinite time, and the donors can claim an income tax deduction, based on certain limitations imposed by the Code. For the period ended December 31, 2017, all contributions and revenues received were exempt from income tax. Use of Estimates In preparing the financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities of the date of the financial statements, and the reported revenues and expenses during the reporting period. Actual results could differ from those estimates. 6

9 Notes to Financial Statements Continued Salon Literario LibroAmérica en PR, Inc Financial Statement Presentation The Organization presents its financial statements as provided for Not-for-Profit Organizations. Under this approach, the Organization is required to report the information regarding its financial position and activities according to three classes of net assets: unrestricted, temporarily restricted, or permanently restricted. In addition, the Organization is required to present a statement of Cash Flows. NOTE 2 FUND ACCOUNTING The Company uses the fund accounting method to keep accounting records. Fund Accounting is the required method by the American Institute of Certified Public Accountants for Not-For-Profit organizations. NOTE 3 CONCENTRATION OF CREDIT RISK Financial instruments, which potentially subject the Organization to concentrations of credit risk, consist of cash deposits. The Organization has cash deposits with one (1) financial institution. The cash deposits did not exceed the amount insured by the Federal Deposit Insurance Corporation (FDIC) as of statement date. Therefore, as of statement date, all cash deposits were insured by the FDIC. NOTE 4 CASH As of statement date, cash balance includes the following: Operating Account $9, PR Culture Institute Funds Account $ NOTE 5 PLEDGES RECEIVABLE As of statement date, the Organization had not recognized contributions receivable from unconditional promises. NOTE 6 CREDIT CARD PAYABLE The Organization has a Visa card with a revolving credit line at Banco Popular of PR. The outstanding amount payable to as of statement date was $12, The credit card requires minimum monthly payments when in use and accrues interest on the average outstanding balance. NOTE 7 PAYROLL LIABILITIES This provision consists of the outstanding payroll taxes and income taxes withheld in origin from payments for professional services accrued as of statement date. It does not represent any past due amounts from prior years. 7

10 Notes to Financial Statements Continued Salon Literario LibroAmérica en PR, Inc NOTE 8 CREDIT LINE PAYABLE The Organization has a $15,000 credit line with Banco Popular of PR. The outstanding amount payable to as of statement date was $25, The line requires monthly payments when in use and accrues interest at 9.25% on the average outstanding balance. NOTE 9 LEASE AGREEMENT The Organization has entered into a lease agreement, auto renewed annually. The cost of this agreement is donated by Foundation for Puerto Rico and has a value of $1, per month. The estimated fair value of the donation was $12, for the year ended December 31, The Organization recognizes the use of these facilities as an unconditional donation. NOTE 9 SUPPLEMENTAL DISCLOSURES FOR THE STATEMENT OF CASH FLOWS During the year ended December 31, 2017, the Company has made interest payments to the Banco Popular of Puerto Rico under the arrangement described in Note 8, amounting to $1, approximately. 8