FINANCIAL STATEMENTS AND REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS ASSISI ANIMAL CLINIC OF VIRGINIA, INC. (A NON-PROFIT ORGANIZATION)

Transcription

1 FINANCIAL STATEMENTS AND REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS ASSISI ANIMAL CLINIC OF VIRGINIA, INC. (A NON-PROFIT ORGANIZATION)

2 CONTENTS Report of Independent Certified Public Accountants 1 Financial Statements: Statements of Financial Position 3 Statement of Activities 4 Statements of Functional Expenses 5 Statements of Cash Flows 6 Notes to Financial Statements 7 Page

3 INDEPENDENT AUDITORS REPORT July 15, 2017 To the Board of Directors of: Report on the Financial Statements We have audited the accompanying financial statements of (a non-profit organization) which comprise the statements of financial position as of December 31, 2016 and the related statements of activities, functional expenses and cash flows 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 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 financial statements based on our audits. We conducted out audits in accordance with auditing standards generally accepted in the United States of America. These standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of 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 auditors' 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 presentation 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 financial position of as of and the changes in its net assets and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. Roanoke, Virginia

4 (A Non-Profit Organization) STATEMENT OF FINANCIAL POSITION ASSETS CURRENT ASSETS: Cash and cash equivalents $ 74,155 Employee Advance 1,400 Total current assets 75,555 PROPERTY AND EQUIPMENT: Buildings and improvements 290,681 Vehicles 252,526 Furniture and fixtures 63,326 Software 33,061 Medical equipment 93,582 Total property and equipment 733,176 Less: accumulated depreciation (415,648) Property and equipment, net 317,528 OTHER ASSETS Investments available for sale 649,440 TOTAL $ 1,042,523 LIABILITIES AND NET ASSETS CURRENT LIABILITIES: Accounts payable and employee withholdings 63,260 Related party advances payable 65,020 Total current liabilities 128,280 NET ASSETS: Unrestricted 829,158 Unrealized gain on investments 85,084 Total net assets 914,242 TOTAL $ 1,042,523 The accompanting notes are an integral part of these statements 3

5 (A Non-Profit Organization) STATEMENT OF ACTIVITIES For the Year Ended Unrestricted SUPPORT & REVENUE: Foundation, non-profit and corporate grants $ 23,915 Individual and religious organizations 684,775 Total grants and contributions 708,690 Program service revenue 1,610,468 Realized gain on sale of investments 18,877 Dividend and interest income 11,896 Total unrestricted support 2,349,931 EXPENSES: Program services Assisi Clinic and Adoption Center 1,518,873 Management and general 63,898 Fundraising 1,504 Net expenses 1,584,275 Change in net assets 765,656 Net assets, December 31, ,502 Net assets, $ 829,158 The accompanying notes are an integral part of these financial statements 4

6 (A Non-Profit Organization) STATEMENT OF FUNCTIONAL EXPENSES For the Year Ended Program Assisi Clinic Mgmt & General Supporting Services Fund- Raising Total Support Functional Expenses Salaries & labor $ 788,099 $ 41,498 $ 41,498 $ 829,597 Payroll taxes 92,036 4,844 4,844 96,880 Fringe benefits 22,473 1,182 1,182 23,655 Total payroll related expenses 902,608 47,524 47, ,132 Advertising Bank and credit card 20,341 20,341 Depreciation 26,200 1,500 1,500 27,700 Education Events Fuel 2,888 2,888 Insurance 21,474 21,474 Legal and accounting 1,229 1,229 1,229 Licenses and property tax 3,519 3,519 Medical supplies 475, ,403 Miscellaneous expenses Office expenses 10,743 10,743 10,743 Outsourced medical care 7,019 7,019 Payroll service 2, ,669 Repairs and maintenance 15,213 15,213 Small tools and equipment 3,363 3,363 Telephone 2,160 2,160 2,160 Transportation 1,644 1,644 Uniforms Utilities 27,318 27,318 Vehicle expenses 1,483 1,483 Volunteer expenses 7,325 7,325 Totals $ 1,518,873 $ 63,898 $ 1,504 $ 65,402 $ 1,584,275 The accompanying notes are an integral part of these financial statements 5

7 (A Non-Profit Organization) STATEMENT OF CASH FLOWS For the Year Ended CASH FLOWS FROM OPERATING ACTIVITIES: Increase (decrease) in net assets $ 765,656 Adjustments to reconcile change in net assets to net cash provided by operating activities: Depreciation 27,700 Decrease (increase) in operating assets: Decrease (increase) in Accounts receivable 4,256 Increase (decrease) in operating liabilities: Accounts payable and employee withholdings (48,103) Advances from related parties (29,471) Net cash provided (used) by operating activities 720,038 CASH FLOWS USED BY INVESTING ACTIVITIES: Purchases of property and equipment (135,850) Increase in investments available for sale (564,357) Net cash (used) provided by investing activities (700,207) NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS 19,831 Cash and cash equivalents, beginning of year 54,324 Cash and cash equivalents, end of year $ 74,155 Interest paid during the year $ - The accompanying notes are an integral part of these financial statements 6

8 NOTES TO FINANCIAL STATEMENTS NOTE A - NATURE OF ACTIVITIES (the organization) was established on January 5, 2001 as a no-kill shelter and for the primary purposes of providing reduced cost medical care for animals with a special emphasis on spaying and neutering to prevent pet overpopulation. The organization provides shelter, care and sustenance to companion and domesticated farm animals in need, including an adoption center for homeless dogs and cats and a farm animal sanctuary. Following are various activities provided by the organization: Feral Cat TNR Program Angels of Assisi has performed over 10,000 feral cat spay/neuter surgeries. Feral cats can be brought to the clinic every Monday, Tuesday, or Wednesday for surgery. High-Volume, Low-Cost Spay/Neuter To date, Angels of Assisi has performed over 300,000 low cost spay and neuter surgeries. Rescue Groups We are very appreciative of the relationships with other rescue groups. Many times these groups will help with certain breeds of dogs or cats. When an animal is transferred to another No Kill group, it opens a space at Angels of Assisi for an animal that may have been down at a local pound. Foster Care The Angels of Assisi foster families are an integral part of saving the lives of homeless pets. From bottle feeding puppies and kittens to helping seniors and abuse cases, the foster families always come through. Comprehensive Adoption Programs Staff and volunteers take the Angels of Assisi pets up for adoption to many festivals, fairs, community gatherings, and store openings throughout the year. We also have a Mas-Cat program where cats live in local stores and offices to get extra exposure while they wait for their new families. Pet Retention Angels of Assisi offers courtesy listing on our website for people looking to rehome pets. We also offer advice for behavior issues, and are developing more ways to help people keep their pets instead of turning them into pounds. 7

9 NOTES TO FINANCIAL STATEMENTS Medical and Behavior Rehabilitation Angels of Assisi has an agreement with Botetourt County Animal Control to take any and all neglect and cruelty cases. The Biscuit Fund was created to help with medical treatment and rehabilitation of these neglected/abused pets. NOTE B - SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The Organization recognizes income on the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America. Basis of Presentation The financial statements are presented are in accordance with FASB Accounting Standard Codification (FASB ASC) 958, Not-for-Profit Entities. Under FASB ASC 958, the Organization is required to report information regarding its financial position and activities according to three classes of net assets: unrestricted, temporarily restricted and permanently restricted. The Organization had no permanently restricted or temporarily restricted net assets as of. Property and Equipment Property and equipment are stated at cost. Depreciation is calculated for financial statement purposes using the straight-line method based on the property's estimated life. Additions and improvements that add materially to productive capacity or extend the life of an asset are capitalized. Normal repairs and maintenance are charged against income. When facilities are retired or sold, their cost and accumulated depreciation are removed from the accounts and related gains or losses are included in income. In case of trade items, any remaining book value increases the basis of the new acquisitions. Donations of property and equipment are recorded as support at their estimated fair value. Such donations are reported as unrestricted support unless the donor has restricted the donated asset to a specific purpose. The estimated lives used in determining depreciation are: 8

10 NOTES TO FINANCIAL STATEMENTS Building and building improvements Automobiles Personal property Software 7 30 yrs 5 yrs 5 7 yrs 3 yrs Income Taxes The Organization is a not-for-profit organization that is generally exempt from income taxes under Section 501(c)(3) of the Internal Revenue Code. In addition, the organization has been classified as an organization that is not a private foundation under Section 590(a)(1). Income that is not related to exempt purposes, less applicable deductions, is subject to Federal and state corporate income taxes. Cash and Cash Equivalents For purposes of the statements of financial position and cash flows, the Organization considers all unrestricted highly liquid investments, with an initial maturity of three months or less, to be considered cash. Investments Available for Sale The organization maintains a commercial brokerage investment account with BB&T/Scott & Stringfellow. The organization lists stocks, bonds and other securities intended to be held for long-term investment as a non-current asset. Any highly liquid instruments within this account may be listed as a cash equivalent. Investments are reported at their current market value. Unrealized gains are reported in Net Assets on the Statement of Financial Position. Market Value at $ 649,440 Less: Cost Basis 564,357 Unrealized Gain on Investments $ 85,084 Contributed Services Many unpaid volunteers have made significant contributions of their time to the management of the Organization and to the adoption, foster care, and health care operations. The value of this donated time is not recognizable and is not reflected in these financial statements. 9

11 NOTES TO FINANCIAL STATEMENTS Restricted and Unrestricted Revenue Contributions received are recorded as unrestricted, temporarily restricted, or permanently restricted support, depending on the existence and/or nature of any donor restrictions. All donor-restricted support is reported as an increase in temporarily or permanently restricted net assets, depending on the nature of the restriction. When a restriction expires (that is, when a stipulated time restriction ends or purpose restriction is accomplished), temporarily restricted net assets are reclassified to unrestricted net assets and reported in the Statement of Activities as net assets released from restrictions. Grants and Contract Awards The Organization may receive grants from governmental agencies and corporate entities for various purposes. Grants not yet received are accrued to the extent that unreimbursed expenses have been incurred for the purposes specified by an approved grant. Grants and Other Accounts Receivable Management has elected to record bad debts using the direct write-off method. Accounting principles generally accepted in the United States of America require that the allowance method be used to reflect bad debts. However, the effect of the use of the direct write-off method is not materially different from the results that would have been obtained had the allowance method been followed. Promises to Give Unconditional promises to give are recognized as revenue or gains in the period received and as assets, decreases of liabilities, or expenses depending on the form of the benefits received. Conditional promises to give are recognized when the conditions on which they depend are substantially met. All promises to give are due in less than one year. Functional Allocation of Expenses The costs of providing the various programs and other activities have been summarized on a functional basis in the Statement of Functional Expenses. Accordingly, certain costs have been allocated among the programs and supporting services benefited. 10

12 NOTES TO FINANCIAL STATEMENTS Use of Estimates In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the 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. Uncertain Tax Provisions Accounting for uncertain income tax positions, relating to both federal and state income taxes, are required when a more likely than not threshold is attained. If such positions result in uncertainties, then the unrecognized tax liability is estimated based on a cumulative probability assessment that aggregates the estimated tax liability for all uncertain tax positions. With the adoption of these new rules, the Organization assessed its tax positions in accordance with the guidance. The Organization has determined that its tax status as a DC non-profit corporation is its only tax position and is highly certain. Therefore, these new rules had no impact on the Organization s financial statements. Subsequent Events Management has evaluated subsequent events through July 15, 2017, the date which the financial statements were available to be issued. In early 2017 the Organization has received a parcel of land in the city of Roanoke with an estimated market value of $350,000. The board has future plans to raise additional funds through grants and donations to build a new shelter and clinic on this property. NOTE C CONCENTRATION OF CREDIT RISK CASH The Organization has several cash accounts at local banks and/or brokerage firms. These accounts are insured, up to $250,000, by the Federal Deposit Insurance Corporation. The Organization has not experienced any losses and believes it is not exposed to any significant credit risk on cash. 11

13 NOTES TO FINANCIAL STATEMENTS NOTE D RELATED PARTY ADVANCES The Organization has, from time to time, received non-interest bearing advances from entities controlled by an officer and director of the organization. These are nonrecourse loans that were advanced for working capital during the formation of the entity. 12