Pet-Assisted Visitation Volunteer Services, Inc. d/b/a PAWS for People. Financial Statements. December 31, 2014 and 2013

Transcription

1 Pet-Assisted Visitation Volunteer Services, Inc. Financial Statements December 31, 2014 and 2013

2 Table of Contents Page Independent Accountant s Review Report... 3 Financial Statements Statements of Financial Position... 4 Statement of Activities For the Year Ended December 31, Statement of Activities For the Year Ended December 31, Statement of Functional Expenses For the Year Ended December 31, Statement of Functional Expenses For the Year Ended December 31, Statements of Cash Flows... 9 Notes to Financial Statements... 10

3 Independent Accountant s Review Report To the Board of Directors Newark, Delaware We have reviewed the accompanying statements of financial position of Pet-Assisted Visitation Volunteer Services, Inc.,, (a nonprofit organization) as of December 31, 2014 and 2013, and the related statements of activities, functional expenses and cash flows for the years then ended. A review includes primarily applying analytical procedures to management s financial data and making inquiries of Organization management. A review is substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole. Accordingly, we do not express such an opinion. Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing, implementing, and maintaining internal control relevant to the preparation and fair presentation of the financial statements. Our responsibility is to conduct the review in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. Those standards require us to perform procedures to obtain limited assurance that there are no material modifications that should be made to the financial statements. We believe that the results of our procedures provide a reasonable basis for our report. Based on our reviews, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with accounting principles generally accepted in the United States of America. August 18, 2015 Wilmington, Delaware

4 Statements of Financial Position December 31, 2014 and 2013 Assets Re-classified CURRENT ASSETS Cash and cash equivalents $ 145,921 $ 101,165 Cash and cash equivalents - restricted 58, ,609 Pledges receivable 8,151 8,374 Marketable securities 17,968 13,504 Total current assets 230, ,652 PROPERTY AND EQUIPMENT - AT COST Furniture and equipment 85,217 83,941 Leasehold improvements 33,543 33,543 Total 118, ,484 Less: accumulated depreciation 87,101 70,996 Property and equipment - net 31,659 46,488 TOTAL ASSETS $ 262,035 $ 283,140 Liabilities and Net Assets CURRENT LIABILITIES Accrued expenses $ 1,739 $ 3,110 NET ASSETS Unrestricted 51,960 66,421 Unrestricted - board designated 150, ,000 Temporarily restricted 58, ,609 Total net assets 260, ,030 TOTAL LIABILITIES AND NET ASSETS $ 262,035 $ 283,140 See accompanying notes to financial statements and independent accountant s review report. 4

5 Statement of Activities For the Year Ended December 31, 2014 Temporarily Unrestricted Restricted Total REVENUE AND OTHER SUPPORT Contributions $ 140,040 $ 6,300 $ 146,340 Grants - 29,610 29,610 Noncash contributions 168, ,336 Membership income 29,858-29,858 Program revenue 42,005-42,005 Other miscellaneous revenue 33,397-33,397 Special events income - net 47,658-47,658 Net assets released from restrictions Satisfaction of program restrictions 91,183 (91,183) - Total revenue and other support 552,477 (55,273) 497,204 EXPENSES Program services 365, ,508 Support services Administrative and general 99,929-99,929 Fundraising 51,501-51,501 Total support services 151, ,430 Total expenses 516, ,938 CHANGE IN NET ASSETS 35,539 (55,273) (19,734) NET ASSETS - BEGINNING OF YEAR 166, , ,030 NET ASSETS - END OF YEAR $ 201,960 $ 58,336 $ 260,296 See accompanying notes to financial statements and independent accountant s review report. 5

6 Statement of Activities For the Year Ended December 31, 2013 Re-classified Re-classified Temporarily Unrestricted Restricted Total REVENUE AND OTHER SUPPORT Contributions $ 65,701 $ 79,093 $ 144,794 Grants - 75,128 75,128 Noncash contributions 204, ,637 Membership income 27,680-27,680 Program revenue 29,005-29,005 Other miscellaneous revenue 31,325-31,325 Special events income - net 35,450-35,450 Net assets released from restrictions Satisfaction of program restrictions 148,041 (148,041) - Total revenue and other support 541,839 6, ,019 EXPENSES Program services 408, ,905 Support services Administrative and general 98,482-98,482 Fundraising 51,276-51,276 Total support services 149, ,758 Total expenses 558, ,663 CHANGE IN NET ASSETS (16,824) 6,180 (10,644) NET ASSETS - BEGINNING OF YEAR 183, , ,674 NET ASSETS - END OF YEAR $ 166,421 $ 113,609 $ 280,030 See accompanying notes to financial statements and independent accountant s review report. 6

7 Statement of Functional Expenses For the Year Ended December 31, 2014 Support Services Administrative Total Program and Fund Support Services General Raising Services Total Salaries $ 143,452 $ 78,432 $ 47,551 $ 125,983 $ 269,435 Payroll taxes 11,915 6,514 3,950 10,464 22,379 Employee benefits 7,576 5,537-5,537 13,113 Total payroll expenses 162,943 90,483 51, , ,927 Advertising and printing 9, ,114 Bad debt 1, ,158 Bank charges ,310 Computer expense 12,423 1,379-1,379 13,802 Depreciation 14,494 1,611-1,611 16,105 Dues and subscriptions Grant expenses 2, ,458 Insurance 3, ,079 Meetings and conventions Miscellaneous 10,655 1,184-1,184 11,839 Office expenses 5, ,466 Other supplies 10, ,942 Postage 2, ,940 Professional fees 105,745 2,130-2, ,875 Rent 7, ,520 Taxes and licenses Training 3, ,439 Travel 10, ,399 Total expenses $ 365,508 $ 99,929 $ 51,501 $ 151,430 $ 516,938 See accompanying notes to financial statements and independent accountant s review report. 7

8 Statement of Functional Expenses For the Year Ended December 31, 2013 Support Services Administrative Total Program and Fund Support Services General Raising Services Total Salaries $ 127,173 $ 78,159 $ 47,299 $ 125,458 $ 252,631 Payroll taxes 10,692 6,571 3,977 10,548 21,240 Employee benefits 8,280 1,616-1,616 9,896 Total payroll expenses 146,145 86,346 51, , ,767 Advertising and printing 3, ,615 Bank Charges 1, ,403 Computer expense 8, ,391 Depreciation 21,891 2,432-2,432 24,323 Dues and subscriptions Grant Expenses 5, ,634 Insurance 3, ,577 Meetings and conventions 13, ,748 Miscellaneous 7, ,751 Office expenses 9,631 1,070-1,070 10,701 Other supplies 21, ,331 Postage 2, ,016 Professional fees 140,505 5,022-5, ,527 Rent 7, ,520 Taxes and licenses Telephone Training 4, ,543 Travel 9, ,394 Total expenses $ 408,905 $ 98,482 $ 51,276 $ 149,758 $ 558,663 See accompanying notes to financial statements and independent accountant s review report. 8

9 Statements of Cash Flows For the Year Ended December 31, 2014 and CASH FLOWS FROM OPERATING ACTIVITIES Change in net assets $ (19,734) $ (10,644) Adjustments to reconcile change in net assets to net cash provided by (used in) operating activities Depreciation 16,105 24,323 Unrealized gain on investments (111) (1,332) Changes in current assets and current liabilities Increase in pledge receivables 223 (701) Increase (decrease) in accrued expenses (1,371) 3,110 Net cash provided by (used in) operating activities (4,888) 14,756 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property and equipment (1,276) (13,075) Acquisition of marketable securities (4,353) (2,000) Net cash used in investing activities (5,629) (15,075) NET DECREASE IN CASH AND CASH EQUIVALENTS (10,517) (319) CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 214, ,093 CASH AND CASH EQUIVALENTS - END OF YEAR $ 204,257 $ 214,774 See accompanying notes to financial statements and independent accountant s review report. 9

10 Notes to Financial Statements (See Independent Accountant s Review Report) Note A - Organization and Summary of Significant Accounting Policies 1. Activities and Business Operations (the "Organization") is a not-for-profit organization that is a comprehensive center for providing elders, children and those with disabilities individualized, therapeutic visits with gentle, affectionate pets in the larger communities in which they live. offers an evolving menu of programs and services. These include one-on-one visiting, hospital visiting and reading programs for children. 2. Financial Statement Presentation In accordance with accounting principles generally accepted in the United States of America, the Organization is required to report 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. In addition, the Organization is required to present a statement of cash flows. 3. Revenue and Expense Recognition The Organization recognizes revenues and expenses on the accrual basis of accounting. Under the accrual method, revenues are recognized when earned and expenditures are recorded when incurred. 4. Contributions, Promises to Give, Restricted and Unrestricted Revenue and Support In accordance with accounting principles generally accepted in the United States of America, contributions received are recorded as unrestricted, temporarily restricted or permanently restricted support, depending on the existence and/or nature of any donor restrictions. 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 restricting ends or purpose restriction is accomplished), temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statements of activities as net assets released from restrictions. 10

11 Notes to Financial Statements (See Independent Accountant s Review Report) Note A - Organization and Summary of Significant Accounting Policies (Continued) 4. Contributions, Promises to Give, Restricted and Unrestricted Revenue and Support (Continued) Contributed services are not recognized as revenues unless the services received create or enhance the value of a non-financial asset; or require specialized skills which are provided by individuals possessing those skills and would typically need to be purchased if not provided by volunteers. The Organization received $159,815 and $196,116 in donated services during the years ended December 31, 2014 and 2013, respectively. Such amounts include $60,000 each year representing a charge for the donated salary of the executive director. Office space is donated to the Organization by a related party and is recorded at fair market value at $8,520 for each of the years ended December 31, 2014 and Cash and Cash Equivalents Cash equivalents are included in cash. The Organization considers all unrestricted highly liquid investments with an initial maturity of three months or less to be cash equivalents. 6. Advertising Advertising costs are charged to expense when incurred. Advertising costs are included in advertising and printing. Advertising costs were $9,114 and $3,615 for the years ended December 31, 2014 and 2013, respectively. 7. Income Tax Status The Organization has elected to be classified as a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code. Accordingly, it is not subject to state or federal income taxes. Therefore, no provision or liability for income tax is presented in these financial statements. The Organization accounts for the effect of any uncertain tax positions based a on a more likely than not threshold to the recognition of the tax positions being sustained based on the technical merits of the position under scrutiny by the applicable taxing authority. The Organization recognizes accrued interest and penalties associated with uncertain tax positions, if any, as a component of administrative and general expenses. The Organization did not have any income tax uncertainties that were considered greater than remote. 11

12 Notes to Financial Statements (See Independent Accountant s Review Report) Note A - Organization and Summary of Significant Accounting Policies (Continued) 8. Marketable Securities The Organization reports marketable securities at fair value in the statements of financial position. Any unrealized gains and losses on investments are reported as increases or decreases in unrestricted net assets. 9. Functional Allocation of Expenses The Organization allocates their expenses on a functional basis among its various programs and support services. Expenses that can be identified with a specific program and support service are allocated directly according to their natural expenditure classification. All other expenses are allocated in proportion with the benefits provided to the related program service. 10. Management 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 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. 11. Property and Equipment Property and equipment, if purchased, are recorded at cost and at fair market value, if donated. Maintenance, repairs and minor renewals are charged directly to expense as incurred. Additions and betterments to property and equipment are capitalized. When assets are disposed of, the related cost and accumulated depreciation thereon are removed from the accounts, and any resulting gain or loss is included in the statements of activities. Depreciation is computed using the straight-line method based upon the estimated useful lives of the related assets. The useful lives for purposes of computing depreciation of the assets are as follows: Furniture and equipment Leasehold improvements 5 years 10 years Depreciation expense was $16,105 and $24,323 for the years ended December 31, 2014 and 2013, respectively. 12

13 Notes to Financial Statements (See Independent Accountant s Review Report) Note A - Organization and Summary of Significant Accounting Policies (Continued) 12. Pledges Receivable and Allowance for Uncollectible Accounts The Organization uses the allowance method to provide for the estimated losses that will be incurred in the collection of outstanding pledges receivable balances. Estimated losses are based on a combination of historical collection experience and a review of the current status of outstanding pledges receivable balances. At December 31, 2014 and 2013, management determined all pledges receivable to be fully collectible and thus provided no allowance for uncollectible accounts. 13. Fair Value Measurements The Organization adopted the Fair Value Measurements and Disclosures for assets and liabilities measured at fair value on a recurring basis. The standard defines fair value and establishes a hierarchy for reporting the reliability of input measurements used to assess fair value for all assets and liabilities. The hierarchy consists of three broad levels: Level 1 Observable inputs such as quoted market prices in active markets for identical assets or liabilities. Level 2 Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3 Unobservable inputs for which there is little or no market data, which require the use of the reporting entity s own assumptions. All cash and cash equivalents, pledges receivable, marketable securities and accrued expenses, are carried at cost on the statement of financial position, which approximate fair value due to their short-term, highly liquid nature and is based on the best available data. Investments are carried at fair market value, based on quoted market prices in active markets. 13

14 Notes to Financial Statements (See Independent Accountant s Review Report) Note B - Special Events The following is a schedule of special fund-raising events for Pet-Assisted Visitation Volunteer Services, Inc. for the years ended December 31,: Direct Net Revenue Expenses Proceeds Jingle Bell Brunch $ 19,614 $ 4,545 $ 15,069 Wag-n-Walk 29,126 6,293 22,833 Other 11,272 1,516 9,756 $ 60,012 $ 12,354 $ 47,658 Direct Net Revenue Expenses Proceeds Jingle Bell Brunch $ 10,630 $ 4,877 $ 5,753 Wag-n-Walk 32,233 5,929 26,304 Other 5,093 1,700 3,393 Note C - Temporarily Restricted Net Assets $ 47,956 $ 12,506 $ 35,450 Net assets were temporarily restricted in the amount of $58,336 and $113,609 by donors for future program initiatives as of December 31, 2014 and 2013, respectively. 14

15 Notes to Financial Statements (See Independent Accountant s Review Report) Note D - Concentration of Credit Risk Financial instruments that potentially subject the Organization to significant concentrations of credit risk are principally cash and pledges receivable. 1. Cash Balances The Organization, in the ordinary course of business, maintains its cash balance in a financial institution. For the years ended December 31, 2014 and 2013, the balances of both interest and non-interest bearing accounts were insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. The balances of all accounts held at the financial institution are added together, and any amount over the limit is considered uninsured. At times, balances may exceed insured limits, but management does not feel it is exposed to any significant credit risk with respect to uninsured balances maintained at financial institutions. At December 31, 2014 and 2013, cash balances did not exceed federal deposit insurance limits. 2. Major Donors Note E - Investments The Organization s largest donor accounted for approximately 10% and 15% of contribution revenue for the years ended December 31, 2014 and 2013, respectively. The Organization held the following investments at December 31, 2014 and 2013: Marketable securities $ 17,968 $ 13,504 These investments are classified as Level 1 as they are traded in an active market for which daily closing prices are available. Generally, for all marketable securities, fair value is determined by reference to quoted market prices and other relevant information generated by market transactions. Unrealized gains of $111 and $1,332 for the years ended December 31, 2014 and 2013 are reported in the statement of activities as a component of other miscellaneous revenue. 15

16 Notes to Financial Statements (See Independent Accountant s Review Report) Note E - Investments (continued) Certain investments in marketable securities were maintained as an Endowment Fund at the Delaware Community Foundation in the amounts of $16,415 and $13,504 at December 31, 2014 and 2013, respectively. The fund is one of many, commingled, and unitized funds that are managed by the Delaware Community Foundation. The Delaware Community Foundation typically invests in debt and equity securities that are managed by professional investment advisors. Utilization of the investments held at the Delaware Community Foundation is at the discretion of the Board of Directors of the Organization. Although the investments are managed by professional advisors, these investments are subject to fluctuations in the stock/bond market and overall investment risk. Note F - Reclassifications Certain reclassifications have been made to the prior year s financial statements in order to conform to the current year presentation. The reclassifications have no effect on previously reported results of operations or net assets. Note G - Subsequent Events The Organization evaluated its December 31, 2014 financial statements for subsequent events through August 18, 2015, the date on which the financial statements were available to be issued. 16