NAMI LOUISIANA, INC. BATON ROUGE, LOUISIANA FINANCIAL STATEMENTS JUNE 30, 2014

Transcription

1 NAMI LOUISIANA, INC. BATON ROUGE, LOUISIANA FINANCIAL STATEMENTS JUNE 30, 2014 F. C. SCHNEroER, CPA, LLC A Public Accounting Firm Baton Rouge, Louisiana

2 TABLE OF CONTENTS Independent auditor's report i-ii Financial statements Statements of Financial Position 1 Statements of Activities 2 Statements of Cash Flows 3 Notes to financial statements 4-8 Special independent auditor's report Internal Control over Financial Reporting and on Compliance and other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 9-10 Summary of Findings and Responses 11 Summary of Prior Year Findings and Responses 12

3 F. C. SCHNEIDER, CPA, LLC Member American A Public Accounting Firm institute of 251 Florida Street. Suite 405 Accountants P.O. Box 427 Baton Rouge, Louisiana Member Office/Fax Louisiana society Cell of Certified, Public chris@fcscpa.com Accountants INDEPENDENT AUDITOR'S REPORT To the Board of Directors of NAMI Louisiana, Inc. Baton Rouge, Louisiana I have audited the accompanying financial statements of NAMI Louisiana, Inc. (a nonprofit organization), which comprise the statement of financial position as of June 30, 2014, and the related statements of activities and cash flows for the year 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: My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that I 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, I express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of

4 significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Opinion: In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of NAMI Louisiana, Inc. as of June 30, 2014, and the changes in its net assets and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Reporting Required by Government Auditing Standards: In accordance with Government Auditing Standards, I have also issued my report dated December 22, 2014, on my consideration of NAMI Louisiana, Inc.'s internal control over financial reporting and on my tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of my testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering NAMI Louisiana, Inc.'s internal control over financial reporting and compliance. J.c. C7 December 22,

5 NAMI LOUISIANA, INC. STATEMENT OF FINANCIAL POSITION June 30, 2014 ASSETS CURRENT ASSETS Cash and cash equivalents $ 150,860 Gash and cash equivalents - restricted 16,089 Investments, at fair value 12,912 Accounts receivable 22, ,883 PROPERTY AND EQUIPMENT Furniture, fixtures and equipment 32,725 Less accumulated depreciation (27,520) 5,205 OTHER ASSETS Charitable remainder trust assets 157, ,649 TOTAL ASSETS $ 364,737 LIABILITIES AND NET ASSETS CURRENT LIABILITIES Payroll liabilities $ 4,697 Deferred revenue 5,000 Due to affiliate 39,172 TOTAL LIABILITIES 48,869 NET ASSETS Unrestricted 142,130 Unrestricted - Board designated 16,089 Temporarily restricted 157,649 Permanently restricted - TOTAL NET ASSETS 315,868 TOTAL LIABILITIES AND NET ASSETS $ 364,737 See accompanying notes

6 NAMI LOUISIANA, INC. STATEMENT OF ACTIVITIES For the Year Ended June 30, 2014 SUPPORT AND REVENUES Governmental grants Private grants Annual conference Contributions - individual Contributions - corporate Membership dues Fundraising income Other income Dividends and interest income Change in value of charitable remainder trusts Unrealized gain on investments Unrestricted $ 221,781 3,000 20,366 8,185 5,212 2,784 39,672 2, Temporarily Restricted $ 16,973 Permanently Restricted $ Total $ 221,781 3,000 20,366 8,185 5,212 2,784 39,672 2, , Changes in net asset restrictions: Released from restrictions 304,207 16, ,180 EXPENSES Program expenses: Annual conference 7,270 7,270 Conference and travel 27,471 27,471 Insurance 1,399 1,399 Occupancy 6,818 6,818 Payroll and benefits 164, ,363 Payroll taxes 11,127 11,127 Professional services 10,179 10,179 Supplies 1,344 1,344 Telephone and internet 4,510 4,510 Training seminars 18,398 18,398 Other 1,628 1,628 Fundraising expense 37,459 37,459 General and administrative 55,311 55, , ,277 Changes in net assets (43,070) 16,973 (26,097) NET ASSETS Beginning of year, as originally reported Change in reporting entity (see note G) Beginning of year, as restated End of year See accompanying notes 301, ,676 (100,538) 201, ,676 $ 158,219 $ 157,649 $ 442,503 (100,538) 341,965 $ 315,868

7 NAMI LOUISIANA, INC. STATEMENT OF CASH FLOWS For the Year Ended June 30, 2014 CASH FLOWS FROM OPERATING ACTIVITIES Change in net assets $ (26,097) Adjustments to reconcile change in net assets to net cash used in operating activities: Depreciation 3,111 Unrealized gain on investments (1 GO) Changes in operating assets and liabilities: Accounts receivable 11,549 Charitable remainder trust assets (16,973) Payroll liabilities (207) Deferred revenue 2,000 Due to affiliate 39,172 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of fixed assets 12,455 NET INCREASE IN CASH AND CASH EQUIVALENTS 12,455 CASH AND CASH EQUIVALENTS Beginning of the year 255,032 Change in reporting entity (see note G) (100,538) End of the year $ 166,949 RECONCILIATION OF CASH AND CASH EQUIVALENTS Cash and cash equivalents, unrestricted $ 150,860 Cash and cash equivalents, restricted 16,089 $ 166,949 See accompanying notes

8 NAMI LOUISIANA, INC. NOTES TO FINANCIAL STATEMENTS June 30, 2014 A: SIGNIFICANT ACCOUNTING POLICIES Organization and operations: Nami Lousiana, Inc. (NAMI) is a nonprofit corporation whose purpose is to provide a focal point for statewide mental illness activities and issues and to provide a central point for dissemination of information on activities and issues affecting persons with mental illness. The programs include statewide support to family education and support facilitators. This is accomplished by providing educational courses. Financiai statement presentation: NAMI reports information regarding its financial position and activities according to three classes of net assets: unrestricted net assets, temporarily restricted net assets, and permanently restricted net assets, which are described as follows: Unrestricted Net Assets are net assets that are not subject to donor-imposed stipulations and are available for use at the Foundation's discretion. Temporarily Restricted Net Assets are net assets subject to donor-imposed stipulations that may or will be met, either by actions of the Foundation and/or the passage of time. When a restriction expires, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statement of activities as net assets released from restrictions. Permanently Restricted Net Assets are net assets subject to donor-imposed stipulations that the Foundation maintains the contribution permanently. Generally, the donors of these assets permit the Foundation to use all or part of the income earned on any related investments for general or specific purposes. Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Revenue Recognition: Revenue from grants and contracts are recognized according to the specific agreement. Generally, revenues from grants are recognized in the period of the grant award while revenues from cost reimbursement contracts are recognized to the extent of services provided.

9 A: SIGNIFICANT ACCOUNTING POLICIES (Continued) Cash and Cash Equivalents: For purposes of the statements of cash flows, the Foundation considers all highly liquid investments available for current use with an initial maturity of three months or less to be cash equivalents. Investment valuation and Income recognition: Financial Accounting Standards Board Statement No. 157, Fair Value Measurements, (FASB 157), establishes a framework for measuring fair value through a fair value hierarchy that prioritizes the sources of pricing information (inputs) to valuation techniques used to measure fair value. The highest priority is given to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under FASB 157 are described as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. NAMFs investments are stated at fair value. Shares of registered investment companies are valued at the net asset value of such investments held by the Foundation at year end. Investment income includes dividends and interest earned on investments, the realized net gain and/or loss from trade of investments, and net unrealized gain and/or loss resulting from market value fluctuations of investments held at year-end relative to cost. Investment earnings are recorded net of related management fees. Receivables: Management believes that receivables as reflected in the accompanying financial statements are collectible in full therefore no allowance has been recorded. Property and equipment: Property and equipment are carried at cost. Additions, renewals, and betterments that extend the life of assets are capitalized; maintenance and repair expenditures are expensed as incurred. The cost of property and equipment sold or otherwise disposed and the accumulated depreciation thereon are eliminated from the property and related accumulated depreciation accounts, and any gain or loss is credited or charged to income.

10 A: SIGNIFICANT ACCOUNTING POLICIES (Continued) Depreciation is provided using the straight-line method over the estimated useful lives of the property, ranging from five to thirty-nine years. Tax-exempt status: NAMI is a not-for-profit organization that is exempt from income taxes under Section 501(c)(3) of the Internal Revenue Code and classified by the Internal Revenue Service as other than a private foundation. NAMI follows the provisions of FASB ASC , Accounting for Uncertainty in Income Taxes. Management believes it has no material uncertain tax positions and, accordingly has not recognized a liability for any unrecognized tax benefits. NAMI's open audit periods are 2010 through 2013 Advertising: NAMI follows the policy of charging the costs of advertising to expense as incurred. Advertising expense amounted to $652 for the year ended June 30, Charitabie remainder trust assets: NAMI Louisiana, Inc. is one-third remainder beneficiary of two charitable remainder trusts. Payments to the organization will be made upon the death of the income recipients. Therefore, the trusts are recorded as temporarily restricted net assets. The trustee is a third party national financial institution. The fair value of the remainder interest in the trusts is determined using investment returns consistent with the composition of the asset portfolios, life expectancies, and the discount rates of 2.4% at June 30, B: INVESTMENTS Investment in a publicly traded common stock is as follows: Cost Market Equity stock $ 92 $ 12,912 $ 92 $ 12,912 Publicly traded common stock is considered level one investments in the fair value hierarchy.

11 B: INVESTMENTS (Continued) The investment returns for the year ended June 30, 2014 are as follows: Interest $ 65 Dividends 327 Realized gains Unrealized gains 100 ~$ 492 0: PROPERTY Equipment, related service lives, and accumulated depreciation as of June 30, 2014 were as follows: Estimated Service Lives Office Equipment 5 years $ 23,575 Website 3 years 9,150 Less accumulated depreciation (27,520) Net $ 5,205 Depreciation expense was approximately $3,111 for the year ended June 30, D: ECONOMIC DEPENDENCY NAMI derives its revenues from governmental sources as earned revenue or grants, the loss of which would have a material adverse effect on NAME Revenue derived from governmental sources accounted for 73% for the year ending June 30, E: CONCENTRATION OF CREDIT RISK NAMI has concentrated its credit risk for cash by maintaining deposits in a financial institution in Baton Rouge, Louisiana. However, as of June 30, 2014, NAMI's deposits were covered by insurance provided by the U.S. federal Deposit Insurance Corporation (EDIC).

12 F: CONTINGENCIES NAMI receives federal and state contracts for specific purposes that are subject to audit by the agencies. Such audits could lead to requests for reimbursement to the agency for expenditures disallowed under terms of the contract. It is the opinion of management that NAMI's compliance with the terms of contracts will result in negligible, if any, disallowed costs. G: CHANGE IN REPORTING ENTITY During the year, a change in the reporting entity occurred and beginning net assets were restated. In the previous two years, an affiliate of NAMI, Nami Acadiana, Inc., had been combined with NAMI's financial statements. Because Nami Acadiana, Inc. did not have their 501c(3) status recognition from the Internal Revenue Service, NAMI collected all of the donations from the NamiWalks fundraiser on behalf of Nami Acadiana, Inc., their sole source of revenue. Effective, June 23, 2014, the Internal Revenue Service recognized Nami Acadiana's 501c(3) status and they will begin reporting their own contributions in the period ending June 30, Therefore, it is no longer necessary to combine their financial statements with NAMI's. The effect of this change resulted in net assets decreasing by $100,538. H: SUBSEQUENT EVENTS In preparing these financial statements, NAMI has evaluated events and transactions for potential recognition or disclosure through December 22, 2014, the date the financial statements were available to be issued.

13 F. C. SCHNEIDER, CPA, LLC American A Public Accounting Firm 251 Florida Street, Suite 405 P.O. Box 427 Baton Rouge, Louisiana institute of Certified Public Accountants Member Louisiana society of Certified Office/Fax Cell , Public chris@fcscpa.com Accountants INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Board of Directors of NAM! Louisiana, Inc. Baton Rouge, Louisiana I have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of NAM! Louisiana, Inc., which comprise the statement of financial position as of June 30, 2014 and the related statements of activities, and cash flows for the years then ended, and the related notes to the financial statements, and have issued my report thereon dated December 22, Internal Control Over Financial Reporting: In planning and performing my audit of the financial statements, I considered NAM! Louisiana, Inc.'s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing my opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of NAM! Louisiana, Inc.'s internal control. Accordingly, I do not express an opinion on the effectiveness of NAM! Louisiana, Inc.'s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. My consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material

14 weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during my audit I did not identify any deficiencies in internal control that I consider to be material weaknesses. However, material weaknesses may exist that have not been identified. I did identify certain deficiencies in internal control, described in the accompanying schedule of findings and questioned costs as item that I consider to be a significant deficiency. Compliance and Other Matters: As part of obtaining reasonable assurance about whether NAMI Louisiana, Inc.'s financial statements are free from material misstatement, I performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of my audit, and accordingly, I do not express such an opinion. The results of my tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. NAMI Louisiana, Inc. 's Response to Findings: NAMI Louisiana, Inc.'s response to the findings identified in my audit is described in the accompanying schedule of findings and questioned costs. NAMI Louisiana, Inc.'s response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, I express no opinion on it. Purpose of this Report: The purpose of this report is solely to describe the scope of my testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the organization's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the organization's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Under Louisiana Revised Statute 24:513, this report is distributed by the Louisiana Legislative Auditor as a public document. J. c. c:7 December 22,

15 NAMI LOUISIANA, INC. SUMMARY OF FINDINGS AND RESPONSES June 30, Accounting Overview/Financial Statement Preparation Criteria: Under U.S. generally accepted accounting principles (GAAP), an entity must have internal controls in place to ensure that presentation and related disclosures of its financial statements and related footnotes are in compliance with GAAP. Condition: NAMI Louisiana, Inc. (NAMI) relies on its auditors to assist in the preparation of external financial statements and related disclosures. Cause/Effect: Under U.S. GAAP, the auditor cannot be considered part of the NAMI's internal control structure, however, design of the internal control structure does not otherwise include procedures to prepare internal financial statements and related disclosures in conformity with GAAP. Recommendation: NAMI considers using the treasurer to review and approve the external financial statements to alleviate the deficiency to be adequate and appropriate. Under this option, NAMI chooses their treasurer based on their ability to prepare or review the external financial statements, including related footnote disclosures, which are in accordance with generally accepted accounting principles. Alternatively, NAMI continues to rely on its auditing firm to prepare the external financial statements. However, this matter will continue to be reported. Management's Response: Management understands that this finding results from professional standards that have been adopted by the accounting profession. Management intends to continue using the auditing firm to prepare the external financial statements and related footnote disclosures. 11

16 NAMI LOUISIANA, INC. SUMMARY OF PRIOR YEAR FINDINGS AND RESPONSES June 30, Accounting Overview/Financial Statement Preparation Observation: NAMI continues to have its financial statements prepared by the auditor. This finding is repeated in the current year as Overbllling Salaries/Wages on State Contracts (Resolved) Observation: NAMI is currently billing salaries on an hourly basis as requested by the agency. It appears the state has dropped its claim that NAMI reimburse any funds. 12