ANGELA MERICI AND JOHN HENRY NEWMAN FOUNDATION, INC. Financial Statements with Independent Auditors Report

Transcription

1 ANGELA MERICI AND JOHN HENRY NEWMAN FOUNDATION, INC. Financial Statements with Independent Auditors Report Year Ended (With Summarized Comparative Totals for 2008)

2 TABLE OF CONTENTS Page Independent Auditors Report... 1 Financial Statements: Statement of Financial Position... 2 Statement of Activities... 3 Statement of Cash Flows... 4 Notes to Financial Statements Supplementary Financial Information: Statement of Financial Position - Split by School Statement of Activities - Split by School Statement of Activities - Cardinal Newman High School Statement of Activities - Ursuline High School... 20

3 INDEPENDENT AUDITORS REPORT To the Board of Directors ANGELA MERICI AND JOHN HENRY NEWMAN FOUNDATION, INC. Santa Rosa, California We have audited the accompanying statement of financial position of ANGELA MERICI AND JOHN HENRY NEWMAN FOUNDATION, INC. (the Foundation) as of, and the related statements of activities and cash flows for the year then ended. These financial statements are the responsibility of the Foundation s management. Our responsibility is to express an opinion on these financial statements based on our audit. The prior year summarized comparative information has been derived from the Foundation s 2008 financial statements and, in our report dated October 29, 2008, we expressed an unqualified opinion on those financial statements. We conducted our audit 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 of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of ANGELA MERICI AND JOHN HENRY NEWMAN FOUNDATION, INC. as of, and the changes in its net assets and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. Our audit was conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying statement of financial position - split by School, statement of activities - split by School, statement of activities - Cardinal Newman High School and statement of activities - Ursuline High School are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects, in relation to the basic financial statements taken as a whole. San Francisco, California October 13, 2009

4 STATEMENT OF FINANCIAL POSITION (With Summarized Comparative Totals for 2008) ASSETS Cash and cash equivalents $ 690,417 $ 746,126 Contributions receivable, net 939,165 2,632,719 Investments, net 354, ,722 Cash and cash equivalents held for long-term purposes 209, ,158 Note receivable - related party 783,330 1,000,000 Total assets $ 2,976,994 $ 4,936,725 LIABILITIES AND NET ASSETS Liabilities: Note payable $ 783,330 $ 1,000,000 Commitments Total liabilities 783,330 1,000,000 Net assets (deficiency): Unrestricted (66,139) - Temporarily restricted 1,254,139 1,763,664 Permanently restricted 1,005,664 2,173,061 Total net assets 2,193,664 3,936,725 Total liabilities and net assets $ 2,976,994 $ 4,936,725 See notes to financial statements. 2

5 STATEMENT OF ACTIVITIES For the Year Ended (With Summarized Comparative Totals for 2008) Temporarily Permanently Unrestricted Restricted Restricted Total Total Revenue, gains (losses) and other support: Contributions $ - $ 10,350 $ - $ 10,350 $ 440,777 Dividend and interest income - 28,909-28,909 46,882 Net unrealized losses on investments (66,139) (12,730) - (78,869) (35,616) Net assets released from restrictions 572,446 (572,446) Total revenue, gains (losses) and other support 506,307 (545,917) - (39,610) 452,043 Expenses: Program expenses: Contributions to Cardinal Newman High School 244, , ,152 Contributions to Ursuline High School 312, ,594 16,370 Supporting services: Administration 15, ,598 29,365 Total expenses 572, , ,887 Bad debt, net of discount - 23,897 1,107,108 1,131,005 - Total expenses and losses 572,446 23,897 1,107,108 1,703, ,887 Change in net assets before reclassifications (66,139) (569,814) (1,107,108) (1,743,061) (226,844) Reclassifications - 60,289 (60,289) - - Change in net assets (66,139) (509,525) (1,167,397) (1,743,061) (226,844) Net assets (deficiency): Beginning of year - 1,763,664 2,173,061 3,936,725 4,163,569 End of year $ (66,139) $ 1,254,139 $ 1,005,664 $ 2,193,664 $ 3,936,725 See notes to financial statements. 3

6 STATEMENT OF CASH FLOWS For the Year Ended (With Summarized Comparative Totals for 2008) Cash flows from operating activities: Change in net assets $ (1,743,061) $ (226,844) Adjustments to reconcile change in net assets to net cash used by operating activities: Contributions restricted for endowment - (77,419) Change in discount on promises to give (5,130) (151,171) Bad debt expense 1,136,135 - Net unrealized losses on investments 78,869 35,616 Decrease in assets: Contributions receivable, net 464, ,273 Prepaid expenses and other assets - 1,875 Total adjustments 1,674,163 71,174 Net cash used by operating activities (68,898) (155,670) Cash flows from investing activities: Purchase of investments (11,826) (117,021) Increase in cash and cash equivalents held for long-term purposes (73,245) (109,417) Issuance of note receivable to Cardinal Newman High School - (1,000,000) Net cash used by investing activities (85,071) (1,226,438) Cash flows from financing activities: Receipt of endowment contributions 98, ,301 Proceeds from notes payable - 1,000,000 Net cash provided by financing activities 98,260 1,158,301 Net decrease in cash and cash equivalents (55,709) (223,807) Cash and cash equivalents: Beginning of year 746, ,933 End of year $ 690,417 $ 746,126 See notes to financial statements. 4

7 NOTES TO FINANCIAL STATEMENTS 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Purpose and Organization ANGELA MERICI AND JOHN HENRY NEWMAN FOUNDATION, INC. (the Foundation) was incorporated on May 3, 2005 as a California non-profit corporation for the specific purpose of supporting religious, charitable and educational activities exclusively for Cardinal Newman High School (CNHS) and Ursuline High School (UHS). The Foundation s board consists of members from both CNHS and UHS. Unless all or any portion of contributions made to the Foundation for the benefit of CNHS or UHS are specifically earmarked for the benefit of either school, the net assets of the Foundation shall be held and distributed equally to CNHS and UHS. Basis of Accounting The Foundation prepares its financial statements in accordance with accounting principles generally accepted in the United States of America, which involves the application of accrual accounting; consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. Basis of Presentation Classification of Net Assets Accounting principles generally accepted in the United States of America require that the Foundation 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. Accordingly, the net assets of the Foundation are classified and reported as described below: Unrestricted: Those net assets and activities which represent the portion of expendable funds that are available to support the Foundation s operations. A portion of these net assets may be designated by the Board of Directors for specific purposes. Temporarily Restricted: Those net assets and activities which are donor-restricted for (a) support of specific operating activities; (b) investment for a specified term; (c) use in a specified future period; or (d) acquisition of long-lived assets. Permanently Restricted: Those net assets and activities which are permanently donor-restricted for holdings of (a) assets donated with stipulations that they be used for a specified purpose, be preserved, and not be sold; or (b) assets donated with stipulations that they be invested to provide a permanent source of income. 5

8 NOTES TO FINANCIAL STATEMENTS 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 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. Cash and Cash Equivalents The Foundation considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents restricted as to their use are not included as equivalents, regardless of liquidity. At cash and cash equivalents also includes a certificate of deposit with an original maturity of one year. Contributions Receivable Unconditional contributions receivable are recognized as revenues or gains in the period such promises are made by the donor. Conditional contributions receivable are recognized only when the conditions on which they depend are substantially met and the promises become unconditional. Unconditional contributions receivable which are due beyond one accounting cycle are recorded at the present value of the contribution, determined using the risk-free interest rate applicable for the year in which the promises are to be received. The interest portion earned in future periods is recorded as contributions in the periods earned. The Foundation uses the allowance method to account for uncollectible unconditional contributions receivable. The allowance is based on prior years experience and management s analysis of specific promises made. Investments The Foundation s investments consist of equity and bond mutual fund investments. The investments are managed as a single diversified portfolio governed by the Foundation s investment policy. All investments are held in funds managed by Christian Brothers Investments Services, Inc. (Christian Brothers). The units of the Christian Brothers funds are not publicly traded; however, the funds underlying securities are traded on national exchanges whose daily quoted prices determine fair value. The Foundation monitors fair value through a documented valuation process including verification of the fair value of marketable securities in the funds and monitoring of each fund s activity. Realized and unrealized gains and losses are included in the statement of activities. Investments received through gifts are recorded at estimated fair value at the date of donation. 6

9 NOTES TO FINANCIAL STATEMENTS 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Revenue Recognition Contributions The Foundation recognizes all contributions in the year of receipt, regardless of compliance with restrictions. Contributions without donor-imposed restrictions are reported as unrestricted support. Contributions with donor-imposed restrictions are reported as either temporarily restricted or permanently restricted support, depending upon the type of restriction. The satisfaction of a donor-imposed restriction on a contribution is recognized when the corresponding expenditures are incurred or when the time restriction expires. This occurs by increasing one class of net assets and decreasing another in the statement of activities. Such transactions are recorded as net assets released from restrictions and are reported separately from other transactions. Contributed Goods and Services Donated materials and equipment are recorded as contributions at their estimated value on the date of receipt. Such donations are reported as unrestricted support unless the donor has restricted the donated asset to a specific purpose. Assets donated with explicit restrictions regarding their use are reported as restricted support. Absent donor stipulations regarding how long those donated assets must be maintained, the Foundation reports expirations of donor restrictions when the donated or acquired assets are placed in service as instructed by the donor. The Foundation reclassifies temporarily restricted net assets to unrestricted net assets at that time. The Foundation records contribution revenue for certain services received at the fair value of those services, if the services (a) create or enhance nonfinancial assets, or (b) require specialized skills, are provided by individuals possessing those skills, and would be purchased if not donated. For the year ended there were no contributed services that would materially impact the financial statements as presented. Investment Income Realized and unrealized gains and losses and investment income (losses) derived from investment transactions are included as income in the year earned. Income Taxes The Foundation is a qualified organization exempt from federal and California income taxes under 501(c)(3) of the Internal Revenue Code and 23701d of the California Revenue and Taxation Code. 7

10 NOTES TO FINANCIAL STATEMENTS 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Concentrations of Risk Financial Instruments Financial instruments which potentially subject the Foundation to concentrations of credit risk consist principally of cash and cash equivalents, contributions receivable, and investments. The Foundation maintains its cash in various bank deposit accounts which, at times, may exceed federally insured limits. The Foundation has not experienced any losses in such accounts. Concentrations of credit risk with respect to contributions receivable are limited because the promises are from numerous individuals. The Foundation attempts to limit its credit risk associated with cash equivalents and investments by utilizing outside investment managers to place the Foundation s investments with highly rated corporate and financial institutions. Management believes that the Foundation is not exposed to any significant credit risk related to concentrations. Comparative Financial Information The financial statements include certain prior year summarized comparative information in total but not by net asset class. Such information does not include sufficient detail to constitute a presentation in conformity with accounting principles generally accepted in the United States of America. Accordingly, such information should be read in conjunction with the Foundation s financial statements for the year ended June 30, 2008, from which the summarized information was derived. 2. FAIR VALUE MEASUREMENTS AND INVESTMENTS The Foundation s financial assets and liabilities carried at fair value have been classified, for disclosure purposes, based on a hierarchy defined by SFAS No. 157, Fair Value Measurements. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). An asset s or a liability s classification is based on the lowest level input that is significant to its measurement. For example, a Level 3 fair value measurement may include inputs that are both observable (Levels 1 and 2) and unobservable (Level 3). The levels of the fair value hierarchy are as follows: Level 1 Values are unadjusted quoted prices for identical assets and liabilities in active markets accessible at the measurement date. Level 2 Inputs include quoted prices for similar assets or liabilities in active markets, quoted prices from those willing to trade in markets that are not active, or other inputs that are observable or can be corroborated by market data for the term of the instrument. Such inputs include market interest rates and volatilities, spreads and yield curves. 8

11 NOTES TO FINANCIAL STATEMENTS 2. FAIR VALUE MEASUREMENTS AND INVESTMENTS (CONTINUED) Level 3 Certain inputs are unobservable (supported by little or no market activity) and significant to the fair value measurement. Unobservable inputs reflect the Foundation s best estimate of what hypothetical market participants would use to determine a transaction price for the asset or liability at the reporting date. The following is a description of the valuation methodologies used for assets and liabilities measured at fair value. The carrying amounts of cash and cash equivalents approximate fair value because of the short maturity of these instruments. The carrying amounts of long-term receivables and payables approximate fair value as these receivables and payables earn interest based on the prevailing rates. Investments measured at fair value on a recurring basis The following table provides information as of, about the Foundation s investments measured at fair value on a recurring basis. All investments held by the Foundation are classified as level 2 investments. CBIS investments: CUIT Core Equity Index Fund $ 149,926 CUIT International Equity Fund 39,634 RCT Intermediate Diversified Bond Fund 165,119 Total assets at fair value $ 354, CONTRIBUTIONS RECEIVABLE Unconditional contributions receivable at consist of the following: Current Due in 2 to 5 Years Thereafter Total Contributions receivable $ 373,327 $ 682,783 $ 1,340,000 $ 2,396,110 Allowance for doubtful contributions receivable (26,265) (34,140) (1,340,000) (1,400,405) Discount to net present value - (56,540) - (56,540) $ 347,062 $ 592,103 $ - $ 939,165 All long-term contributions receivable are stated at their present values. Management has discounted these contributions receivable using a discount rate of 5.50%. 9

12 NOTES TO FINANCIAL STATEMENTS 4. NOTE RECEIVABLE - RELATED PARTY AND NOTE PAYABLE In June 2008, the Foundation converted its $1,000,000 line of credit agreement with a bank to an unsecured term loan (the note) with monthly principal and interest payments in an amount sufficient to fully repay the note over five years. The note bears interest at the bank s prime rate plus 0.38%, with a minimum interest rate limit of 5.00%. At, the interest rate on the note was 5.38%. The following is a schedule of principal payments for the years ending June 30: 2010 $ 200, , , ,330 $ 783,330 Funds obtained from the note payable amounting to an original total of $1,000,000 were loaned to CNHS in order to facilitate major capital projects. In return, CNHS has signed an unsecured note payable to the Foundation, to repay all principal and interest on the original note. The note receivable from CNHS has exactly the same terms as the note payable. CNHS pays principal and interest on the note payable directly to the bank and therefore the interest revenue and expense are not reflected on the Foundation s statement of activities. During the year ended, CNHS paid interest of $47,800 and principal of $216,670, on the note. 5. UNRESTRICTED NET ASSETS (DEFICIENCY) Unrestricted net assets (deficiency) at are composed of: Unrealized loss on endowment - UHS $ (23,141) Unrealized loss on endowment - CNHS (42,998) $ (66,139) 6. TEMPORARILY RESTRICTED NET ASSETS Temporarily restricted net assets at may be expended for: Restricted for the benefit of UHS $ 856,037 Restricted for the benefit of CNHS 398,102 $ 1,254,139 10

13 NOTES TO FINANCIAL STATEMENTS 7. PERMANENTLY RESTRICTED NET ASSETS Permanently restricted net assets include gifts with respect to which donors have stipulated, as a condition in the gift instrument that the principal is to be held indefinitely. Permanently restricted net assets at June 30, 2009 consist of the following: Restricted for the benefit of UHS $ 522,600 Restricted for the benefit of CNHS 483,064 $ 1,005, ENDOWMENT The Foundation s endowment consists of approximately 25 individual funds established for a variety of purposes. Its endowments include only donor-restricted endowment funds. Net assets associated with endowment funds are classified and reported based on the existence or absence of donor-imposed restrictions. The Board of Directors of the Foundation has interpreted California s enacted version of UPMIFA as requiring the preservation of the fair value of the original gift as of the gift date of the donor-restricted endowment funds absent explicit donor stipulations to the contrary. As a result of this interpretation, the Foundation classifies as permanently restricted net assets (a) the original value of gifts donated to the permanent endowment, (b) the original value of subsequent gifts to the permanent endowment, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. The remaining portion of the donorrestricted endowment fund that is not classified in permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the Foundation in a manner consistent with the standard of prudence prescribed by UPMIFA. In accordance with UPMIFA, the Foundation considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds: (1) The duration and preservation of the fund (2) The purposes of the Foundation and the donor-restricted endowment fund (3) General economic conditions (4) The possible effect of inflation and deflation (5) The expected total return from income and the appreciation of investments (6) Other resources of the Foundation (7) The investment policies of the Foundation 11

14 NOTES TO FINANCIAL STATEMENTS 8. ENDOWMENT (CONTINUED) Endowment net asset (deficiency) composition by type of fund as of : Unrestricted Temporarily Restricted Permanently Restricted Total Donor-restricted endowment funds $ (66,139) $ 6,657 $ 1,005,664 $ 946,182 Total funds $ (66,139) $ 6,657 $ 1,005,664 $ 946,182 Funds with Deficiencies From time to time, the fair value of assets associated with individual donor-restricted endowment funds may fall below the level that the donor or UPMIFA requires the Foundation to retain as a fund of perpetual duration. Deficiencies of this nature that are reported in unrestricted net assets were $66,139 as of. These deficiencies resulted from unfavorable market fluctuations that occurred shortly after the investment of new permanently restricted contributions and continued appropriation for certain programs that was deemed prudent by the Board of Directors. Future investment gains will be used to offset the deficit in unrestricted net assets. Return Objectives and Risk Parameters Permanently restricted (endowment) funds shall be invested with the objectives of safety of corpus, growth, and return and may be invested in any number of authorized investment tools that meet these objectives. The investment goal of these funds is to generate sufficient total return on assets to permit (a) distribution of five percent of assets annually, and (b) allocation to the donated funds of an additional percentage equal to inflation plus one percent for real growth. Actual returns in any given year may vary from this amount. Strategies Employed for Achieving Objectives To satisfy its long-term rate-of-return objectives, the Foundation relies on a total return strategy in which investment returns are achieved through both capital appreciation (realized and unrealized) and current yield (interest and dividends). The Foundation targets a diversified asset allocation of 65% equities, 32% fixed income securities and 3% cash and cash equivalents. 12

15 NOTES TO FINANCIAL STATEMENTS 8. ENDOWMENT (CONTINUED) Spending Policy and How the Investment Objectives Relate to Spending Policy The Board of Directors has implemented a total return (income plus appreciation) spending policy. The policy is designed to provide a meaningful and growing payout to UHS and CNHS while preserving the endowment's assets on an inflation-adjusted basis. At the beginning of each year the investment management committee will recommend to the Board of Directors a distribution figure for the endowment guided by the following formula: Total Return - Fees - Inflation Rate - 1% Growth Reserve = Payout Fees include investment charges. The inflation rate is the Consumer Price Index. At the discretion of the Board, the spending policy may be temporarily suspended during unusual market conditions, such as those experienced in 2008 and Given the unusual market conditions the corpus of the endowments has not been increased by the inflation rate or the 1% growth reserve during the year ended. Changes in endowment net assets for the year ended : Unrestricted Temporarily Restricted Permanently Restricted Total Endowment net assets, beginning of year $ - $ 12,502 $ 2,173,061 $ 2,185,563 Investment return: Investment income - 6,885-6,885 Net unrealized depreciation (66,139) (12,730) - (78,869) Total investment return (66,139) (5,845) - (71,984) Other changes: Increase in allowance for bad debts/ change in discount - - (1,107,108) (1,107,108) Reclassification to temporarily restricted net assets - - (60,289) (60,289) Net change (66,139) (5,845) (1,167,397) (1,239,381) Endowment net assets (deficiency), end of year $ (66,139) $ 6,657 $ 1,005,664 $ 946,182 13

16 NOTES TO FINANCIAL STATEMENTS 8. ENDOWMENT (CONTINUED) Description of amounts classified as permanently restricted net assets and temporarily restricted net assets: Permanently restricted net assets: The portion of perpetual endowment funds that is required to be retained permanently either by explicit donor stipulation or by UPMIFA $ 1,005,664 Temporarily restricted net assets: The portion of perpetual endowment funds subject to a time restriction under UPMIFA: With purpose restrictions $ 6, NET ASSETS RELEASED FROM RESTRICTIONS Net assets were released from restrictions by incurring expenses satisfying the restricted purposes or by the occurrence of other events specified by donors during the year ended as follows: Program curriculum: UHS $ 312,594 CNHS 244,254 Foundation supporting services administration 15,598 $ 572, RELATED PARTY TRANSACTIONS Since its inception, the Foundation has largely been operated by the staff of CNHS. The salaries of these employees and other indirect costs of operating the Foundation were paid by CNHS and no portion of these costs have been allocated to the Foundation or UHS. 14

17 NOTES TO FINANCIAL STATEMENTS 11. RECLASSIFICATIONS Reclassifications at consist of: Change in donor restrictions $ 40,000 Reclassification to agree the beginning net assets for each School 20,289 $ 60, SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Non-cash transactions for the year ended consisted of $216,670 paid directly by CNHS on the Foundation s note payable, thereby reducing both the Foundation s note payable and note receivable. 13. SUBSEQUENT EVENTS The Foundation has evaluated all subsequent events through October 13, 2009, the date the financial statements were available to be issued. 15

18 ANGELA MERICI AND JOHN HENRY NEWMAN FOUNDATION, INC. Supplementary Financial Information Year Ended

19 STATEMENT OF FINANCIAL POSITION - SPLIT BY SCHOOL ASSETS CNHS UHS Total Cash and cash equivalents $ 13,226 $ 677,191 $ 690,417 Contributions receivable, net 546, , ,165 Investments, net 228, , ,679 Cash and cash equivalents held for long-term purposes 50, , ,403 Note receivable - related party 783, ,330 Total assets $ 1,621,498 $ 1,355,496 $ 2,976,994 LIABILITIES AND NET ASSETS Liabilities: Note payable $ 783,330 $ - $ 783,330 Commitments Total liabilities 783, ,330 Net assets (deficiency): Unrestricted (42,998) (23,141) (66,139) Temporarily restricted 398, ,037 1,254,139 Permanently restricted 483, ,600 1,005,664 Total net assets 838,168 1,355,496 2,193,664 Total liabilities and net assets $ 1,621,498 $ 1,355,496 $ 2,976,994 17

20 STATEMENT OF ACTIVITIES - SPLIT BY SCHOOL For the Year Ended CNHS UHS Total Revenue, gains (losses) and other support: Contributions $ 5,275 $ 5,075 $ 10,350 Dividend and interest income 8,812 20,097 28,909 Net unrealized losses on investments (50,702) (28,167) (78,869) Total revenue, losses and other support (36,615) (2,995) (39,610) Expenses: Program expenses: Contributions to Cardinal Newman High School 244, ,254 Contributions to Ursuline High School - 312, ,594 Supporting services: Administration 7,799 7,799 15,598 Total expenses 252, , ,446 Bad debt, net of discount 552, ,360 1,131,005 Total expenses and losses 804, ,753 1,703,451 Change in net assets before reclassifications (841,313) (901,748) (1,743,061) Reclassifications 20,000 (20,000) - Reclassifications - prior year * (40,397) 40,397 - Change in net assets (861,710) (881,351) (1,743,061) Net assets: Beginning of year 1,699,878 2,236,847 3,936,725 End of year $ 838,168 $ 1,355,496 $ 2,193,664 * Prior year reclassification of net assets was due to adjustments made to agree the beginning net assets for each School. 18

21 STATEMENT OF ACTIVITIES - CARDINAL NEWMAN HIGH SCHOOL For the Year Ended Temporarily Permanently Unrestricted Restricted Restricted Total Revenue, gains (losses) and other support: Contributions $ - $ 5,275 $ - $ 5,275 Dividend and interest income - 8,812-8,812 Net unrealized losses on investments (42,998) (7,704) - (50,702) Net assets released from restrictions 252,053 (252,053) - - Total revenue, gains (losses) and other support 209,055 (245,670) - (36,615) Expenses: Program expenses: Contributions to Cardinal Newman High School 244, ,254 Supporting services: Administration 7, ,799 Total expenses 252, ,053 Bad debt, net of discount - 11, , ,645 Total expenses and losses 252,053 11, , ,698 Change in net assets before reclassifications (42,998) (257,619) (540,696) (841,313) Reclassifications - 50,144 (30,144) 20,000 Reclassifications - prior year * - (26,150) (14,247) (40,397) Change in net assets (42,998) (233,625) (585,087) (861,710) Net assets (deficiency): Beginning of year - 631,727 1,068,151 1,699,878 End of year $ (42,998) $ 398,102 $ 483,064 $ 838,168 * Prior year reclassification of net assets was due to adjustments made to agree the beginning net assets for each School. 19

22 STATEMENT OF ACTIVITIES - URSULINE HIGH SCHOOL For the Year Ended Temporarily Permanently Unrestricted Restricted Restricted Total Revenue, gains (losses) and other support: Contributions $ - $ 5,075 $ - $ 5,075 Dividend and interest income - 20,097-20,097 Net unrealized losses on investments (23,141) (5,026) - (28,167) Net assets released from restrictions 320,393 (320,393) - - Total revenue, gains (losses) and other support 297,252 (300,247) - (2,995) Expenses: Program expenses: Contributions to Ursuline High School 312, ,594 Supporting services: Administration 7, ,799 Total expenses 320, ,393 Bad debt, net of discount - 11, , ,360 Total expenses and losses 320,393 11, , ,753 Change in net assets before reclassifications (23,141) (312,194) (566,413) (901,748) Reclassifications - 10,144 (30,144) (20,000) Reclassifications - prior year * - 26,150 14,247 40,397 Change in net assets (23,141) (275,900) (582,310) (881,351) Net assets (deficiency): Beginning of year - 1,131,937 1,104,910 2,236,847 End of year $ (23,141) $ 856,037 $ 522,600 $ 1,355,496 * Prior year reclassification of net assets was due to adjustments made to agree the beginning net assets for each School. 20