Paralyzed Veterans of America Spinal Cord Injury Education and Training Foundation, Inc.

Transcription

1 Spinal Cord Injury Education and Training Foundation, Inc. Financial Statements and Independent Auditor s Report Years ended June 30, 2016 and 2015 The report accompanying these financial statements was issued by BDO USA, LLP, a Delaware limited liability partnership and the U.S. member of BDO International Limited, a UK company limited by guarantee.

2 Spinal Cord Injury Education and Training Foundation, Inc. Financial Statements and Independent Auditor s Report Years ended June 30, 2016 and 2015

3 Contents Independent Auditor s Report 3-4 Audited Financial Statements Statements of Financial Position 5 Statements of Activities 6 Statements of Functional Expenses 7-8 Statements of Cash Flows 9 Notes to Financial Statements

4 Tel: Fax: Greensboro Drive Suite 800 McLean, VA Independent Auditor s Report Audit Committee Paralyzed Veterans of America Spinal Cord Injury Education and Training Foundation, Inc. Washington, D.C. We have audited the accompanying financial statements of Paralyzed Veterans of America (PVA Education Foundation), which comprise the statements of financial position as of June 30, 2016 and 2015, 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 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 our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit 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. BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. BDO is the brand name for the BDO network and for each of the BDO Member Firms. 3

5 Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Paralyzed Veterans of America Spinal Cord Injury Education and Training Foundation, Inc. as of June 30, 2016 and 2015, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Paralyzed Veterans of America is affiliated with another organization and, as discussed in the notes to the financial statements, Paralyzed Veterans of America has been included in the consolidated financial statements of the Paralyzed Veterans of America. September 21,

6 Financial Statements

7 Statements of Financial Position Year ended June 30, Assets Cash $ 293,251 $ 266,278 Due From PVA 9,334 - Legacies and bequests receivable 120,190 - Total assets 422, ,278 Liabilities and net assets Liabilities: Due to PVA Research Foundation 19,871 - Grants payable 146, ,676 Total liabilities 166, ,676 Commitments and contingencies Net assets: Unrestricted net assets 135,952 91,602 Temporarily restricted net assets 120,190 - Total net assets 256,142 91,602 Total liabilities and net assets $ 422,775 $ 266,278 See accompanying notes to financial statements. 5

8 Statements of Activities Temporarily Year ended June 30, Unrestricted Restricted Total Unrestricted Operating revenues and support (Note 4) Contributions $ 227,193 $ - $ 227,193 $ 253,232 Contributed services 81,266-81,266 89,949 Legacies and bequests - 120, , ,223 Total operating revenues and support 308, , , ,404 Expenses Program services Research, consumer and professional education 261, , ,506 Total program services 261, , ,506 Support services General and administrative 2,165-2,165 1,870 Total support services 2,165-2,165 1,870 Total operating expenses 264, , ,376 Excess of operating revenues over operating expenses 44, , ,505 87,028 Nonoperating activity Interest income Total nonoperating activity Change in net assets 44, , ,540 87,081 Net assets, beginning of period 91,602-91,602 4,521 Net assets, end of period $ 135,952 $ 120,190 $ 256,142 $ 91,602 See accompanying notes to financial statements. 6

9 Statement of Functional Expenses Research, Consumer and Professional General and Year ended June 30, 2016 Education Administrative Total Education and training grants $ 180,713 $ - $ 180,713 Salaries and wages 38,903-38,903 Employee benefits 13,388-13,388 Professional and consulting 26,641-26,641 Office expenses Conferences, conventions and meetings 2,316-2,316 State registration fees - 1,995 1,995 $ 261,979 $ 2,165 $ 264,144 See accompanying notes to financial statements. 7

10 Statement of Functional Expenses Research, Consumer and Professional General and Year ended June 30, 2015 Education Administrative Total Education and training grants $ 279,757 $ - $ 279,757 Salaries and wages 50,694-50,694 Employee benefits 17,217-17,217 Professional and consulting 19,622-19,622 Office expenses Conferences, conventions and meetings 5,989-5,989 State registration fees - 1,870 1,870 $ 373,506 $ 1,870 $ 375,376 See accompanying notes to financial statements. 8

11 Statements of Cash Flows Year ended June 30, Cash flows from operating activities Change in unrestricted net assets $ 164,540 $ 87,081 Adjustments to reconcile change in unrestricted net assets to net cash provided by operating activities: Increase in legacies & bequests receivable (120,190) - Increase in due from PVA (9,334) - Increase in due to PVA Research Foundation 19,871 Decrease in grants payable (27,914) (59,568) Net cash provided operating activities 26,973 27,513 Cash and cash equivalents, beginning of period 266, ,765 Cash and cash equivalents, end of period $ 293,251 $ 266,278 See accompanying notes to financial statements. 9

12 Notes to Financial Statements 1. Organization Paralyzed Veterans of America (PVA Education Foundation), a nonprofit corporation founded in Delaware on September 2, 1986, is controlled by Paralyzed Veterans of America (PVA), a national, nonprofit corporation chartered by the U.S. Congress on August 11, The purpose of PVA Education Foundation is to support institutions, agencies, and organizations to ensure quality care for spinal cord injury and disease by improving the ability and competence of health professionals who care for persons with spinal cord injury and/or disease, such as caregivers. PVA Education Foundation s primary sources of revenue are contributions from PVA, PVA chapters, and the general public as well as legacies and bequests. 2. Summary of Accounting Policies Basis of Presentation The financial statements are prepared on the accrual basis of accounting and include the assets, liabilities, net assets, and change in net assets related to the business of PVA Education Foundation. The net assets, contributions, gains, and losses are classified based on the existence or absence of donor-imposed restrictions. Accordingly, the net assets of PVA Education Foundation and changes therein are classified and reported as follows: Unrestricted net assets Net assets that are not subject to donor-imposed restrictions. Temporarily restricted net assets Net assets subject to donor-imposed stipulations that may or will be met either by actions of PVA Education Foundation and/or the passage of time. Expirations of temporary restrictions on net assets (i.e., the donor-stipulated purpose has been fulfilled and/or the stipulated time period has elapsed) are reported as reclassifications between the applicable classes of net assets. Permanently restricted net assets Net assets subject to donor-imposed stipulations that they be maintained permanently by PVA Education Foundation. Revenues are reported as increases in unrestricted net assets unless use of the related assets is limited by donor-imposed restrictions. Expenses are reported as decreases in unrestricted net assets. PVA Education Foundation did not have any permanently restricted net assets at June 30, 2016 and

13 Notes to Financial Statements Cash and Cash Equivalents Cash is held in liquid investments with original maturities at the date of purchase of three months or less and consist primarily of a money market fund. PVA Education Foundation places its cash with a high quality brokerage firm. Amounts held in excess of the Securities Investor Protection Corporation (SIPC) limits were $43,251 and $16,278 at June 30, 2016 and 2015, respectively. PVA Education Foundation has not experienced any losses in this account. SIPC insures cash accounts at brokerage houses up to $250,000 at June 30, 2016 and Grants Payable The PVA Education Foundation approves multiyear grants in total at the time of initial grant award and records these amounts as grants payable. The grants are generally provided by the PVA Education Foundation, 45% in the first year, 45% in year two, and the remaining 10% is provided upon completion of the grant. The discount on these long term grants is considered immaterial by management. Contributions Contributions, including unconditional promises to give, are recognized as revenues in the period the unconditional promises to give are made. Conditional promises to give are not recognized until the conditions on which they depend are substantially met. There were no conditional promises to give at June 30, 2016 and Contributions received with donor restrictions are recorded as temporarily restricted revenue based on donor intent. Unconditional promises received with payments due in future periods are reported as temporarily restricted, unless the contribution is clearly intended to support current-period activities. The PVA Education Foundation is the beneficiary under various wills. Legacy and bequest revenue is recognized when the PVA Education Foundation has an irrevocable right to the gift and the proceeds are measurable. There were receivables related to legacies and bequests at June 30, 2016 and 2015 of $120,190 and $0, respectively. Contributed Services Contributed services and in-kind contributions are recognized if they create or enhance nonfinancial assets or require specialized skills and would need to be purchased if not provided by donation. 11

14 Notes to Financial Statements Functional Allocation of Expenses The costs of providing programs and other activities have been summarized on a functional basis. Expenses that can be identified with a specific program or support service are charged directly to that function according to their natural expenditure classifications. Other costs are allocated based on personnel time. General and administrative expenses include those costs that are not directly identifiable with any specific function, but which provide for the overall support and direction of the PVA Education Foundation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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. Recent Accounting Pronouncements Not Yet Adopted In August 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) , Not-for-Profit Entities (Topic 958) Presentation of Financial Statements of Not-for-Profit Entities. The ASU amends the current reporting model for nonprofit organizations and enhances their required disclosures. The major changes include: (a) requiring the presentation of only two classes of net assets now entitled net assets without donor restrictions and net assets with donor restrictions, (b) modifying the presentation of underwater endowment funds and related disclosures, (c) requiring the use of the placed in service approach to recognize the expirations of restrictions on gifts used to acquire or construct long-lived assets absent explicit donor stipulations otherwise, (d) requiring that all nonprofits present an analysis of expenses by function and nature in either the statement of activities, a separate statement, or in the notes and disclose a summary of the allocation methods used to allocate costs, (e) requiring the disclosure of quantitative and qualitative information regarding liquidity and availability of resources, (f) presenting investment return net of external and direct expenses, and (g) modifying other financial statement reporting requirements and disclosures intended to increase the usefulness of nonprofit financial statements. The ASU is effective for the PVA Education Foundation s financial statements for fiscal years beginning after December 15, Early adoption is permitted. The provisions of the ASU must be applied on a retrospective basis for all years presented although certain optional practical expedients are available for periods prior to adoption. Management is currently evaluating the impact of their pending adoption of the new standard on the financial statements. 12

15 Notes to Financial Statements 3. Income Taxes The PVA Education Foundation has received an Internal Revenue Service (IRS) determination letter stating that it is not subject to income taxes on its exempt activities under Section 501(c)(3) of the Internal Revenue Code (Code) and that contributions are tax deductible to donors under Section 170 of the Code. The IRS has classified PVA Education Foundation as other than a private foundation as defined in Section 509(a) of the Code. Under the FASB Accounting Standards Codification (ASC) , Income Taxes, an organization must recognize the tax benefit associated with tax positions taken for tax return purposes when it is more-likely-than-not that the position will be sustained. The PVA Education Foundation does not believe there are any material uncertain tax positions and; accordingly, it will not recognize any liability for unrecognized tax benefits. The PVA Education Foundation has filed for and received income tax exemptions in the jurisdictions where it is required to do so. Additionally, the PVA Education Foundation has filed Internal Revenue Service Form 990 tax returns as required and all other applicable returns in those jurisdictions where it is required. The PVA Education Foundation believes that it is no longer subject to U.S. federal, state and local, or non-u.s. income tax examinations by tax authorities for fiscal years before For the years ended June 30, 2016 and 2015, there were no interest or penalties related to uncertain tax positions recorded or included in the statements of activities. 4. Contributions from Paralyzed Veterans of America During the years ended June 30, 2016 and 2015, PVA Education Foundation received contributions of $100,000 and $100,000, respectively, from PVA. PVA provides PVA Education Foundation with personnel and other support for which it does not require reimbursement. The portion of time incurred by personnel that can be directly allocated to PVA Education Foundation is included in program expenses and contributions in the accompanying statements of activities. Also included in general and administrative costs is an allocated percentage of other identifiable costs based on personnel time. Total contributed services from PVA amounted to $74,093 and $89,949 for the years ended June 30, 2016 and 2015, respectively. Other administrative support such as accounting and fund-raising expenses is absorbed by PVA, since amounts related to PVA Education Foundation are not significant. When necessary, an allowance is made for uncollectible contributions, based upon management s best estimates, collection experience, and other relevant factors. 13

16 Notes to Financial Statements 5. Temporarily Restricted Net Assets Temporarily restricted net assets as of June 30, 2016 and 2015 were restricted for the following: Program restrictions $ - $ - Time restrictions 120,190 - Total $ 120,190 $ - 6. Fund-raising Costs PVA does extensive direct mail and other forms of fund-raising. Each year, approximately 4,000,000 Americans contribute to PVA. As part of this extensive fund-raising campaign, the PVA Education Foundation is occasionally highlighted and donors with an interest in the works of the PVA Education Foundation make contributions. PVA personnel solicit for major gifts and legacies, bequests, and pledges to assist the PVA Education Foundation. PVA also administers the Combined Federal Campaign and United Way contributions plus any employer-matching gifts to the PVA Education Foundation. PVA provides the personnel and other support to conduct the above fundraising activities for the PVA Education Foundation at no cost to the PVA Education Foundation. 7. Subsequent Events PVA Education Foundation evaluated subsequent events through September 21, 2016 which is the date the financial statements were available to be issued. No subsequent events were identified that required adjustment to or disclosure within the financial statements. 14