VANCOUVER YOUTH SYMPHONY ORCHESTRA SOCIETY Financial Statements Year Ended May 31, (Unaudited)

Transcription

1 Financial Statements

2 REVIEW ENGAGEMENT REPORT To the Members of Vancouver Youth Symphony Orchestra Society We have reviewed the statement of financial position of Vancouver Youth Symphony Orchestra Society as at May 31, 2017 and the statements of operations and changes in fund balances and cash flows for the year then ended. Our review was made in accordance with Canadian generally accepted standards for review engagements and, accordingly, consisted primarily of inquiry, analytical procedures and discussion related to information supplied to us by the Society. A review does not constitute an audit and, consequently, we do not express an audit opinion on these financial statements. Based on our review, nothing has come to our attention that causes us to believe that these financial statements are not, in all material respects, in accordance with Canadian accounting standards for not-forprofit organizations. Burnaby, British Columbia August 25, 2017 Chartered Professional Accountants 1

3 Statement of Financial Position May 31, 2017 Operating Capital Asset Total Total Fund Fund ASSETS CURRENT Cash $ 422,217 $ 1,550 $ 423,767 $ 388,735 Accounts receivable 1,476-1,476 1,744 Prepaid expenses 5,442-5,442 4, ,135 1, , ,941 Capital Assets (Notes 1 & 2) - 42,381 42,381 42,381 $ 429,135 $ 43,931 $ 473,066 $ 437,322 LIABILITIES AND FUND BALANCES CURRENT Accounts payable and accrued liabilities $ 8,671 $ - $ 8,671 $ 6,462 Government remittances payable Deferred contributions (Note 4) - 1,550 1,550 1,550 8,671 1,550 10,221 8,400 FUND BALANCES Unrestricted 420, , ,541 Invested in capital assets - 42,381 42,381 42, ,464 42, , ,922 $ 429,135 $ 43,931 $ 473,066 $ 437,322 Endowment Fund and Bursary Fund (Note 3) Commitments (Note 6) ON BEHALF OF THE BOARD Director Director The accompanying notes are an integral part of the financial statements. 2

4 Statement of Operations and Changes in Fund Balances Operating Capital Asset Total Total Fund Fund REVENUES Concerts $ 27,199 $ - $ 27,199 $ 14,839 Endowment distributions (Note 3) 75,040-75,040 71,515 Fundraising 25,920-25,920 16,451 Grants and donations (Note 5) 24,476-24,476 26,932 Investment income Sundry 2,178-2,178 1,608 Tuitions 205, , , , , ,531 EXPENSES Administrative (per schedule) 158, , ,287 Artistic (per schedule) 168, , , , , ,518 EXCESS OF REVENUES OVER EXPENSES FROM OPERATIONS 33,923-33,923 21,013 FUND BALANCES, BEGINNING OF YEAR 386,541 42, , ,909 FUND BALANCES, END OF YEAR $ 420,464 $ 42,381 $ 462,845 $ 428,922 The accompanying notes are an integral part of the financial statements. 3

5 Schedule of Expenses Operating Capital Asset Total Total Fund Fund Administrative Accounting, bookkeeping and legal $ 6,374 $ - $ 6,374 $ 9,039 Advertising and promotion 2,502-2,502 3,002 Appreciation 1,021-1,021 1,237 Bank charges and interest 3,738-3, Fundraising and merchandise costs 2,824-2,824 2,321 Insurance 2,645-2,645 2,645 Office and computer 4,062-4,062 2,247 Office rent 7,579-7,579 5,734 Photocopies 4,629-4,629 4,378 Postage Professional development Salaries, contractors and benefits 118, , ,534 Sundry 1,135-1,135 2,272 Telephone 2,349-2,349 2,214 $ 158,473 $ - $ 158,473 $ 149,287 Artistic Auditions and other music expenses $ 14,570 $ - $ 14,570 $ 14,163 Burseries and scholarships ,212 Camps 11,256-11,256 11,519 Concerto competition 1,424-1,424 1,908 Concerts 13,162-13,162 9,828 Conductors 75,240-75,240 74,859 Faculty 5,773-5,773 4,373 Instrument and music maintenance 1,059-1,059 2,630 Music purchase and rentals 1,422-1,422 1,479 Rehearsal hall rental 26,848-26,848 29,900 Special event 11,587-11,587 2,239 Sundry 4,818-4,818 5,484 Transportation $ 168,213 $ - $ 168,213 $ 164,231 The accompanying notes are an intergral part of the financial statements. 4

6 Statement of Cash Flows Operating Capital Asset Total Total Fund Fund CASH PROVIDED (USED IN) OPERATING ACTIVITIES Concerts $ 27,199 $ 27,199 $ 14,839 Endowment distributions 75,040-75,040 71,515 Fundraising 25,920-25,920 16,451 Grants and donations 24,476-24,476 26,932 Interest received Sundry 2,178-2,178 1,608 Tuitions 205, , ,721 Payments for materials and services (206,369) - (206,369) (205,602) Payments for wages and benefits (119,208) - (119,208) (114,598) 35,032-35,032 14,331 NET INCREASE IN CASH 35,032-35,032 14,331 Cash, beginning of year 387,185 1, , ,404 CASH, END OF YEAR $ 422,217 $ 1,550 $ 423,767 $ 388,735 The accompanying notes are an integral part of the financial statements. 5

7 Notes to Financial Statements NATURE AND PURPOSE OF THE SOCIETY Vancouver Youth Symphony Orchestra Society (the "Society") is an organization that provides musical instruction to student members and conducts performance of concerts. The Society is incorporated under the Society Act of British Columbia as a not-for-profit organization and is a registered charity under the Income Tax Act. The Society is exempt from corporate income taxes. 1. SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The financial statements were prepared in accordance with Canadian accounting standards for notfor-profit organizations (ASNFPO). Fund Accounting Vancouver Youth Symphony Orchestra Society follows the restricted fund method of accounting. The Operating Fund reports restricted operating grants, revenues and expenses related to the Society's operating activities. The Capital Asset Fund reports the ownership and equity related to the Society's capital assets. Measurement of Uncertainty The preparation of financial statements in conformity with Canadian accounting standards for not-forprofit organizations requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Such estimates are periodically reviewed and any adjustments necessary are reported in earnings in the period in which they become known. Actual results could differ from these estimates. Financial Instruments The Society initially measures its financial assets and liabilities at fair value. The entity subsequently measures all its financial assets and financial liabilities at amortized cost, except for investments in equity instruments that are quoted in an active market, which are measured at fair value. Changes in fair value are recognized in net income. Financial assets measured at amortized cost include cash. Financial liabilities measured at amortized cost include accounts payable and accrued liabilities. Cash and Cash Equivalents Cash and cash equivalents consist primarily of amounts on deposit with banks, net of cheques issued and outstanding at the reporting date. (continues) 6

8 Notes to Financial Statements 1. SIGNIFICANT ACCOUNTING POLICIES (continued) Capital Assets The Society has chosen to record Capital Assets at the following amounts: Musical instruments Stated at cost Office equipment Recorded at $1 ASNFPO allows for a choice in how a not-for-profit organization discloses its Capital Assets if the average annual revenues recognized in the statement of operations for the current and preceding period of the organization and any entities it controls is less than $500,000. The Society did not expense any Capital Assets acquired in the current or preceding period. Revenue Recognition The Society follows the restricted fund method of accounting for contributions in which externally restricted contributions (donations) are recognized as received in the fund corresponding to the purpose for which they were contributed. Unrestricted contributions are recognized in the Operating Fund. Concerts, tuition, endowment distributions and other revenues are recognized when a sale has occurred, the services have been performed, or an event has taken place and there is a reasonable expectation of collection. Contributed Services Volunteers contribute a significant amount of their time each year. Because of the difficulty in determining their fair value, contributed services are not recognized in the financial statements. GST/HST The Society qualifies for a partial rebate of the goods and services tax paid on its expenditures due to its status as a Canadian registered charity. 2. CAPITAL ASSETS Accumulated Net book Net book Cost amortization value value Musical instruments $ 42,380 $ - $ 42,380 $ 42,380 Office equipment $ 42,381 $ - $ 42,381 $ 42,381 7

9 Notes to Financial Statements 3. ENDOWMENT FUNDS The Vancouver Youth Symphony Orchestra Society Endowment Fund The Society established an endowment fund to provide a permanent source of revenue in order to enable the Society to continue with its high caliber training program, including performances, rehearsals, tours and workshops. The endowment fund is held by the Vancouver Foundation and is not reflected on these statements. The endowment fund has a market value of $2,142,510 as at June 30, 2017 ( $2,017,746) and a contributed principal amount of $1,723,656 as at May 31, 2017 ( $1,723,656). During the year, the Society made principal contributions of $nil ( $nil) to the endowment fund held by the Vancouver Foundation. Income from this endowment fund is distributed quarterly to the Society. Total distributions for the year amounted to $75,040 ( $71,515). Margitta Krebs Bursary Fund During fiscal 2014, the Society established a bursary fund in the name of Margitta Krebs, the longtime conductor of the Debut and Junior Orchestras, to provide tuition bursaries. The bursary fund is held by the Vancouver Foundation and is not reflected on these statements. The bursary fund has a market value of $19,610 as at June 30, 2017 ( $18,468) and a contributed principal amount of $17,643 as at May 31, 2017 ( $17,643). During the year, the Society made principal contributions of $nil ( $nil) to the bursary fund held by the Vancouver Foundation. Income from this bursary fund is distributed annually to the Society. Total distributions for the year amounted to $672 ( $637). 4. DEFERRED CONTRIBUTIONS Deferred contributions consist of a grant received that is restricted in use and may only be used to purchase musical instruments (a capital asset). The deferred contribution will be recognized as revenue in the Capital Asset Fund when the Society purchases musical instruments. 5. GRANTS AND DONATIONS Alan and Gwendoline Pyatt Foundation $ 2,000 $ - Canada Helps 1,324 - Christopher Foundation 1,000 1,000 Corporations 10,000 4,000 Deux Mille Foundation 2,500 - Eric Hamber Foundation 1,000 2,000 Lohn Foundation 2,000 - Individuals 3,325 16,172 Martha Lou Henley Charitable Foundation - 2,500 Vancouver Foundation 1,327 1,260 $ 24,476 $ 26,932 8

10 Notes to Financial Statements 6. COMMITMENTS The Society leases premises from St. James Community Square Society at $2,510 per month for the term of five years commencing July 1, 2016, with possible renewal of a second five year term. The Society has entered into an office equipment service contract at $208 per month plus tax. 7. FINANCIAL INSTRUMENTS The Society is exposed to various risks through its financial instruments. The following analysis provides information about the Society's risk exposure and concentration as of May 31, Credit risk Credit risk arises from the potential that a counter party will fail to perform its obligations. The Society is exposed to credit risk from student members. In order to reduce its credit risk, the Society reviews a new student member's credit history before extending credit and conducts regular reviews of its existing student members' credit performance. An allowance for doubtful accounts is established based upon factors surrounding the credit risk of specific accounts, historical trends and other information. The Society has a significant number of student members which minimizes concentration of credit risk. There has been no change to risk exposure from The Society also holds all of its cash at one financial institution, a credit union, and, accordingly, the Society is subject to the risks associated with the financial institution. The deposits held at the credit union are guaranteed by the Credit Union Deposit Insurance Corporation of British Columbia. Liquidity risk Liquidity risk is the risk that the Society will not be able to meet a demand for cash or fund its obligations as they come due. Liquidity risk also includes the risk of the Society not being able to liquidate assets in a timely manner at a reasonable price. The Society meets its liquidity requirements by preparing and monitoring detailed forecasts of cash flows from operations, anticipating investing and financial activities and holding assets that can be readily converted to cash. There has been no change to risk exposure from Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency rate risk, interest rate risk and other price risk. The Society is not significantly exposed to currency risk, interest rate risk or other price risk. There has been no change to risk exposure from CASH AND CASH EQUIVALENTS At year-end cash and cash equivalents consisted of the following: Cash $ 423,767 $ 388,735 *Cash includes gaming account $ 17,284 $ 16,769 9