DAYSTAR LIFE CENTER, INC.

Transcription

1 Financial Statements with Independent Auditors Report For the Years Ended August 31, 2014 and 2013

2 Table of Contents August 31, 2014 and 2013 INDEPENDENT AUDITORS REPORT FINANCIAL STATEMENTS Statement s of Financial Position...3 Statement s of Activities...4 Statements of Changes in Net Assets...5 Statements of Cash Flows...6 Statement of Functional Expenses...7 Notes to Financial Statements

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5 Statements of Activities Year Ended August 31, 2014 (with comparative total for 2013) Support and Revenue Temporarily Unrestricted Restricted Total Total Contributions and bequests $ 391,875 $ - $ 391,875 $ 185,277 In-kind contributions 322, , ,691 Fundraising events 104, , ,323 Grants and awards 213, , ,378 Interest income 1,478-1,478 2,302 Thrift shop sales 65,194-65,194 49,284 Other income 3,962-3,962 4,834 Donated services 270, , ,378 Donated use of facilities 37,998 6,639 44,637 47,118 Total support and revenue 1,411,524 6,639 1,418,163 1,238,585 Net assets released from restrictions 104,246 (104,246) - - Total support, revenue, and assets released from restrictions 1,515,770 (97,607) 1,418,163 1,238,585 Operating Expenses Program services 1,370,615-1,370,615 1,335,075 Management and general 25,565-25,565 32,106 Fundraising 35,194-35,194 20,719 Total expenses 1,431,374-1,431,374 1,387,900 Increase (decrease) in net assets 84,396 (97,607) (13,211) (149,315) Net assets at beginning of year 277, , , ,257 Net assets at end of year $ 361,886 $ 132,845 $ 494,731 $ 507,942 See accompanying notes to financial statements. 4

6 Statements of Financial Position August 31, 2014 and 2013 Assets Cash and cash equivalents $ 134,403 $ 92,630 Certificates of deposit 263, ,914 Grants and awards receivable 12, ,364 Prepaid expenses 1,957 5,039 Unconditional promises to give 105, ,793 Property and equipment, net of accumulated depreciation 322, ,594 Total assets $ 840,486 $ 844,334 Liabilities and Net Assets Liabilities Accounts payable and accrued expenses $ 18,017 $ 8,654 Mortgage notes payable 327, ,738 Total liabilities 345, ,392 Net Assets Unrestricted 361, ,490 Temporarily restricted 132, ,452 Total net assets 494, ,942 Total liabilities and net assets $ 840,486 $ 844,334 See accompanying notes to financial statements. 3

7 Statements of Changes in Net Assets Years Ended August 31, 2014 and 2013 Unrestricted net assets: Unrestricted operating support and revenue $ 1,411,524 $ 1,177,057 Unrestricted operating expenses (1,431,374) (1,387,900) Net assets released from restrictions 104, ,077 Increase (decrease) in unrestricted net assets 84,396 (89,766) Temporarily restricted net assets: Grant allocation - 54,358 Donated use of facilities 6,639 7,170 Net assets released from restrictions (104,246) (121,077) (Decrease) in temporarily restricted net assets (97,607) (59,549) (Decrease) in net assets (13,211) (149,315) Net assets at beginning of year 507, ,257 Net assets at end of year $ 494,731 $ 507,942 See accompanying notes to financial statements. 5

8 Statements of Cash Flows Years Ended August 31, 2014 and 2013 Cash flows from operating expenses Change in net assets $ (13,211) $ (149,315) Adjustments to reconcile change in net assets to net cash provided by (used in) operating activities Depreciation 45,413 43,729 Decrease in grants and awards receivables 91, ,280 Decrease in bequest receivable - 5,000 Decrease (increase) in prepaid expenses 3,082 (5,039) Decrease in unconditional promises to give 9,140 8,610 Increase (decrease) in accounts payable and accrued expenses 9,363 (863) (Decrease) in deferred revenue - (100,000) Net cash provided by (used in) operating activities 145,502 (33,598) Cash flows from investing activities Purchase of certificates of deposit (200,000) - Redemption of certificates of deposit 101,357 39,926 Certificate of deposit interest reinvested (842) (1,878) Donation of vehicle (3,200) - Purchase of furniture and fixtures, building improvements (1,044) (14,686) Net cash (used in) provided by investing activities (103,729) 23,362 Net increase (decrease) in cash and cash equivalents 41,773 (10,236) Cash and cash equivalents at beginning of year 92, ,866 Cash and cash equivalents at end of year $ 134,403 $ 92,630 Supplemental information on non-cash transactions: Donation of a vehicle $ 3,200 $ - See accompanying notes to financial statements. 6

9 Statement of Functional Expenses Year Ended August 31, 2014 (with comparative total for 2013) Program Management Fundraising Services and General Expense Total Total Salaries and related expenses $ 222,809 $ 8,113 $ 15,875 $ 246,797 $ 226,393 Pension expense 17, ,905 11,358 Sister stipend 8, ,000 9,600 Bike locks 1, ,000 2,000 Bus tokens 14, ,458 20,454 Clothing 12, ,216 7,898 Clothing - in-kind 80, ,129 87,110 Depreciation 43,363 2,050-45,413 43,729 Education and training 1, ,402 4,498 Education and training - clients 15, ,056 4,371 Food 34, ,485 48,017 Food - in-kind 153, , ,570 Fundraising ,051 10,051 7,861 Insurance 3, ,365 3,093 Household items 1, , Household items - in-kind 66, ,029 69,986 Maintenance and repair 15, ,919 19,027 Medical - client 2, ,332 2,874 Miscellaneous 4,764 1, ,365 5,162 Personal hygiene 9, ,452 6,807 Personal hygiene - in-kind 9, ,716 6,861 Personal identification 30, ,014 45,202 Postage 1, ,503 3,104 Professional services 8,079 7,500-15,579 18,481 Professional services - in-kind 267,974 2, , ,709 Rent 52, ,778 55,728 Rent and mortgage assistance 31, ,235 47,595 Supplies 4, ,893 9,157 8,471 Supplies - client 3, ,639 3,295 Supplies - in-kind 9,945-2,748 12,693 3,133 Traveler's aid 37, ,132 28,409 Utilities - client 176, , ,063 Utilities 23,279 1,234-24,513 21,086 Vehicle expense 6, ,858 6,989 Total $ 1,370,615 $ 25,565 $ 35,194 $ 1,431,374 $ 1,387,900 See accompanying notes to financial statements. 7

10 Notes to Financial Statements Years Ended August 31, 2014 and SUMMARY OF SIGNIFICANT ACCCOUNTING POLICIES Center and Purpose Daystar Life Center, Inc., (the Center) was founded in August, 1982 and incorporated in August, 1992, as a Florida not-for-profit corporation. The Center operates primarily to provide financial assistance and other non-financial basic needs services to families and individuals who demonstrate need. The Center provides qualifying clients with rent, utility, personal identification, medical prescription, transportation, traveler s aid, food, clothing, client mail services, tax preparation assistance, advocacy, information referrals and other reasonable requests. Key to the Center s success is the amount of donated services by individuals performing interviewing and other services on a volunteer basis. Basis of Accounting The accompanying financial statements have been prepared using the accrual basis of accounting with generally accepted accounting principles. Net assets, revenues, expenses, gains and losses are classified based on the existence or absence of donor imposed restrictions. Accordingly, net assets of the Center and changes therein are classified and reported as follows: Unrestricted net assets Includes net assets that are not subject to donor imposed stipulations and include designated net assets. Temporarily restricted net assets Includes gifts for which donor imposed restrictions have not been met and promise to give for which the ultimate purpose of the proceeds is not permanently restricted. Permanently restricted net assets Includes gifts, trusts, and pledges that require, by donor restriction, that the corpus be invested in perpetuity and only the income be made available for operations in accordance with donor restrictions and gifts that have been donor stipulated. Cash Equivalents For the purposes of reporting cash flows, the Center considers all liquid investments in money market and savings accounts with maturities of three months or less to be cash equivalents. Property and Equipment Property and equipment are stated at cost or, for donations, at fair market value, as of the date received. Depreciat ion is calculated using the straight-line method over the estimated useful lives of the related assets, which range from four to twenty years. Expenditures with a cost in excess of $750 and with an estimated useful life in excess of one year are capitalized. Gifts of long-lived assets are reported as unrestricted support. 8

11 Notes to Financial Statements 1. SUMMARY OF SIGNIFICANT ACCCOUNTING POLICIES (CONTINUED) Contributions Contributions, including unconditional promises to give, are recorded when made. All contributions are available for unrestricted use unless specifically restricted by the donor. Conditional promises to give are recognized when the conditions on which they depend are substantially met. Contributions that are restricted by the donor are reported as an increase in unrestricted net assets if the restriction expires in the reporting period in which the contribution is recognized. All other donor restricted contributions are reported as an increase in temporarily restricted net assets. When a restriction expires, temporarily restricted net assets are reclassified to unrestricted net assets. In-kind Contributions Donations of food, clothing, personal hygiene products, and household goods are not recognized as revenue until the time of distribution, which is generally the same date of receipt. As a result, the Center does not record such gifts as inventory. Donated Services The Center receives a significant amount of donated services from unpaid volunteers who assist in interviewing, general operations, fundraising and other special projects. However, these services do not require specialized skills as defined in the standards and are not recorded in the accompanying financial statements. Volunteers have contributed approximately 33,000 hours. If the criteria for recognition were met, approximately $623,000 of additional contributions and program service expenses would be recognized in the Statement of Activities for the year ended August 31, Thrift Shop The Center operates a small thrift shop at a donated site. The intent of the thrift shop is to provide a venue to sell excess donation items to customers at a good value and provide Center clients with needed goods. The shop is also intended to supply a modest stream of income to the Center for general operation of the organization. Income Taxes The Center is exempt from U.S. Federal income tax under Section 501(c)(3) of the Internal Revenue Code and has been determined not to be a private foundation. The Center did not conduct unrelated business activities; therefore, no provision has made for federal income taxes in the accompanying financial statements. As of August 31, 2014, the Center s federal Return of Organization Exempt from Income Tax, Form 990, filed for the tax years beginning in 2010, 2011, and 2012 were still subject to possible examination by the Internal Revenue Service. Functional Allocation of Expenses The costs of providing the various programs and other activities are presented in the statement of functional expenses and have been summarized on a functional basis in a separate statement of activities. Accordingly, certain costs have been allocated among the programs and supporting services benefited. 9

12 Notes to Financial Statements 1. SUMMARY OF SIGNIFICANT ACCCOUNTING POLICIES (CONTINUED) Reclassifications Certain reclassifications have been made to the 2013 financial statements to be in conformity with the 2014 presentation. Use of Estimates The preparation 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 certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. 2. UNCONDITIONAL PROMISE TO GIVE Effective April 1994, the Center entered into a 20 year lease agreement with the Diocese of St. Petersburg for use of its facility for a period of 20 years for $1 per year. The use of the facilities at below market rates was recognized as a contribution in 1994, measured by the fair market value of the contribution, and a corresponding unconditional promise to give was recorded. The asset is being amortized over the remaining term of the lease. The lease stipulated that the facility must be used for the original purpose for which the Center was organized. Effective August 23, 2001, the Center entered into an addendum to the lease agreement which extended the lease term for an additional 10 years to March 28, A third addendum was signed to allow the Center to make alterations and improvements to the property, which were made and funded through the Community Development Block Grants received from the City of St. Petersburg. Future amounts of unconditional promise to give, net of discount, are estimated as follows: Less than 1 year $ 15, years 78,899 Subsequent years 40, ,443 Unamortized discount (29,790) 3. GRANTS RECEIVABLE $ 105,653 Grants receivable consists of the following at August 31, 2014 and 2013: City of St. Petersburg $12,636 $ 24,104 Pinellas County 13 15,260 Alleghany Franciscan Ministries - 65,000 $12,649 $104,364 10

13 Notes to Financial Statements 4. PROPERTY AND EQUIPMENT Property and equipment consists of the following at August 31, 2014 and 2013: Leasehold improvements $548,626 $548,626 Furniture, fixtures and equipment 69,594 68,551 Vehicle s 27,798 24, , ,775 Less accumulated depreciation (323,593) (278,181) Net property and equipment $322,425 $363, MORTGAGE NOTES PAYABLE In January 2002, the Center entered into an agreement with the City of St. Petersburg to construct an addition to and to rehabilitate its current facility. As a part of this agreement the Center executed a mortgage note in the amount of $205,000 through the Community Development Block Grant (CDBG) Program. The Diocese of St. Petersburg has joined the Center as a mortgagor; however, the Center holds a leasehold interest in the property by virtue of its lease agreement with the Diocese. This is a non-interest bearing note and the principal amount is deferred until December 31, 2022, if the Center remains fee simple, operates said property as a social service agency and fulfills other program requirements. If the Center complies with the terms and conditions of the agreement, the note shall be forgiven on January 1, In February 2011, the Center entered into an agreement with the City of St. Petersburg to remodel its current facility. As a part of this agreement the Center executed a mortgage note in the amount of $122,738 through the CDBG Program. The Diocese of St. Petersburg has joined the Center as a mortgagor; however, the Center holds a leasehold interest in the property by virtue of its lease agreement with the Diocese. This is a non-interest bearing note and the principal amount is deferred until December 31, 2015, if the Center remains fee simple, operates said property as a social service agency and fulfills other program requirements. If the Center complies with the terms and conditions of the agreement, the note shall be forgiven on January 1, RESTRICTED NET ASSETS At August 31, 2014 and 2013, temporarily restricted net assets consist of the following: Long-lived assets use of facility $105,653 $114,793 Allegany Franciscan Ministries 27, ,959 Pinella s County Social Action Funding - 4,367 City of St. Petersburg Emergency Shelter Grant - 5,333 The Center has no permanently restricted net assets. $132,845 $230,452 11

14 Notes to Financial Statements 7. IN-KIND CONTRIBUTIONS Components of in-kind contributions for the years ended August 31, 2014 and 2013 are as follows: Food $153,904 $151,570 Clothing 80,130 87,110 Personal items and other 88,478 83,011 Rent 44,637 47,118 Total in-kind contributions $367,149 $368, DONATED SERVICES Components of donated professional services for the years ended August 31, 2014 and 2013 are as follows: Accounting $ 81,046 $ 97,458 Skilled labor 120,416 70,470 Computer consultant 62,350 37,450 Video production 6,500 - Total donated services $270,312 $205, RETIREMENT PLAN During December 2005, the Center was approved to participate in the Archdio cese of Miami/Dio cese of St. Petersburg/Diocese of Venice Pension Plan (the Plan ). The effective date of participation was July 1, The Plan is a non-contributory, defined benefit plan. Specific retirement benefits are paid based on years of service and other criteria. The Center incurred retirement expenses of $18,905 and $11,358 in 2014 and 2013, respectively. 10. CONCENTRATION OF RISK Financi al instruments that potentially subject the Center to concentrations of credit risk consist primarily of cash. The Federal Deposit Insurance Corporation (FDIC) currently insures bank deposit accounts up to $250,000 per depositor. At August 31, 2014, the Center had $32,936 of cash balances that exceeded the insurance coverage provided by the FDIC. 11. SUBSEQUENT EVENTS Management has evaluated subsequent events through December, 2014, the date on which the financial statements were available to be issued. 12