FLORIDA A&M UNIVERSITY NATIONAL ALUMNI ASSOCIATION. Tallahassee, Florida

Transcription

1 FLORIDA A&M UNIVERSITY NATIONAL ALUMNI ASSOCIATION Tallahassee, Florida FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2008

2 FOR THE YEAR ENDED JUNE 30, 2008 TABLE OF CONTENTS Independent Auditor s Report Statement of Financial Position... 3 Statement of Activities (2008)... 4 Statement of Activities (2007)... 5 Statement of Cash Flows... 6 Notes to Financial Statements Supplemental Schedule of Revenue and Expenses- By Function (2008) Supplemental Schedule of Revenue and Expenses- By Function (2007) 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

3 Grayson Accounting & Consulting, P.A. 118 Salem Court, Suite B P.O. Box / Tallahassee, FL Telephone (850) / Facsimile (850) Independent Auditor s Report To the Board of Directors of Florida A&M University National Alumni Association Tallahassee, Florida We have audited the accompanying statement of financial position of Florida A&M University National Alumni Association as of June 30, 2008 and June 30, 2007, and the related statements of activities and cash flows for the year then ended. These financial statements are the responsibility of Florida A&M University National Alumni Association s management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our 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 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 the 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 opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Florida A&M University National Alumni Association as of June 30, 2008 and June 30, 2007, and the changes in its net assets and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. In accordance with Government Auditing Standards, we have also issued our report dated August 21, 2008, on our consideration of the Florida A&M University National Alumni Association's internal control over financial reporting and on our 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 our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit Member Florida Institute of Certified Public Accountants / American Institute of Certified Public Accountants

4 performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. Our audit was conducted for the purpose of forming an opinion on the basic financial statements of the Florida A&M University National Alumni Association taken as a whole. The accompanying Supplemental Schedule of Revenue and Expenses by Function is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information had been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. Grayson Accounting & Consulting, P.A. Tallahassee, Florida August 21,

5 STATEMENT OF FINANCIAL POSITION JUNE 30, 2008 (Restated) ASSETS Cash 8,837 74,573 Equity in pooled cash 1,226,626 1,141,179 Unconditional promises to give 30,500 17,570 Other receivables 0 11,759 TOTAL ASSETS 1,265,962 1,245,082 LIABILITIES AND NET ASSETS LIABILITIES NET ASSETS Accounts payable 820 4,353 Total liabilities 820 4,353 Unrestricted 246, ,096 Temporarily restricted 1,011, ,632 Permanently restricted 6,979 0 Total net assets 1,265,142 1,240,729 TOTAL LIABILITIES AND NET ASSETS 1,265,962 1,245,082 The accompanying notes are an integral part of these financial statements. 3

6 STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2008 REVENUES AND OTHER SUPPORT Unrestricted Temporarily Restricted Permanently Restricted Total Revenue and support In-kind contributions 175, ,500 Dues and life memberships 100,640 48, ,885 Contribution 11,876 28,406 6,979 47,260 Grants and scholarships 13, , ,946 Interest and dividends 41,223 8,375 49,598 Registrations & advertising 16,655 16,655 Net assets released from restrictions Restrictions satisfied by payments 84,150 (84,150) - Total Revenues and Other Support 443, ,663 6, ,845 EXPENSES Program services Membership Services 26,205 26,205 Scholarships 84,150 84,150 University Support 179, ,914 Total program services 290, ,269 Management and general 250, ,162 Total Expenses 540, ,431 INCREASE (DECREASE) IN NET ASSETS (97,229) 114,663 6,979 24,413 NET ASSETS, beginning of year 344, , ,240,729 NET ASSETS, end of year 246,867 1,011,295 6,979 1,265,142 The accompanying notes are an intrgral part of these financial statements. 4

7 STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2007 (Restated) REVENUES AND OTHER SUPPORT Unrestricted Temporarily Restricted Permanently Restricted Total Revenue and support In-kind contributions 248, ,000 Dues and life memberships 63,090 58, ,905 Contribution 13,149 6,032 27,301 46,482 Grants and scholarships 82,680 82,680 Interest and dividends 31,692 31,692 Registrations & advertising 16,471 16,471 Net assets released from restrictions Restrictions satisfied by payments 220,500 (121,092) (99,408) 0 Total Revenues and Other Support 592,902 26,435 (72,107) 646,638 EXPENSES Program services Membership Services 11,960 11,960 Scholarships 70,500 70,500 University Support 152, ,150 Total program services 234, ,610 Management and general 335, ,976 Total Expenses 570, ,586 INCREASE (DECREASE) IN NET ASSETS 22,316 26,435 (72,107) (23,356) NET ASSETS, beginning of year 321, ,197 72,107 1,264,084 NET ASSETS, end of year 344, , ,240,729 The accompanying notes are an integral part of these financial statements. 5

8 STATEMENT OF CASH FLOWS YEAR ENDED JUNE 30, 2008 CASH FLOWS FROM OPERATING ACTIVITIES (Restated) Increase in Net Assets 24,413 (23,356) Adjustments to reconcile changes in Net Assets to net cash provided by operations: Increase in pledge receivables (19,995) (10,575) Decrease in receivables 11,759 9,416 Increase in accounts payable 3,533 (765) Contribution restricted for investment in endowment (6,979) (27,301) Net cash provided by operating activities 12,732 (52,581) CASH FLOWS FROM INVESTING ACTIVITIES (Increase) / decrease in equity in pooled cash (85,446) (1,569) CASH FLOWS FROM FINANCING ACTIVITIES Collection of contribution restricted for investment in endowment 6,979 27,301 NET DECREASE IN CASH AND CASH EQUIVALENTS (65,736) (26,848) CASH AND CASH EQUIVALENTS, beginning of the year 74, ,422 CASH AND CASH EQUIVALENTS, end of the year 8,837 74,573 The accompanying notes are an intergral part of these financial statements. 6

9 NOTES TO FINANCIAL STATEMENTS JUNE 30, 2008 and June 30, 2007 NOTE 1. DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES The Florida A&M University National Alumni Association (the National Alumni Association ) is a non-profit organization whose function is to provide a link between the National Alumni Association and the Florida A&M University. Certain employees, including the Executive Director, of the University s Office of Alumni Affairs, spend a portion of their time providing general management and administrative services to the National Alumni Association. The State of Florida provides the funding for the Office of Alumni Affairs, which is part of the University, and the results of its operations are not included in this report. A. Significant Accounting Policies A summary of the National Alumni Association s significant accounting policies, consistently applied in the preparation of the accompanying financial statements follow. Basis of Presentation The accompanying financial statements were prepared in accordance with the provisions of the Statement of Financial Accounting Standards (SFAS) No.117, Financial Statements of Not-for-Profit Organizations. This pronouncement requires not-for profit organizations to report information regarding their financial position and activities according to three classes of net assets as follows: Unrestricted Net Assets represents resources, which have all applicable restrictions satisfied and/or resources generated by other sources. Temporarily Restricted Net Assets represents resources recognized as restricted support until such a time when all associated restrictions have been met. Permanently Restricted Net Assets represents resources that contain a stipulation, which permanently restricts the use of such funds but allows earnings from the funds to be used in a certain manner. 7

10 NOTES TO FINANCIAL STATEMENTS JUNE 30, 2008 and June 30, 2007 NOTE 1. DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES (Continued) Contributions In accordance with SFAS No. 116, Accounting for Contributions Received and Contributions Made, contributions received are recorded as unrestricted, temporarily unrestricted, or permanently restricted support depending on the existence and/or nature of any donor restrictions. Under SFAS No. 116, temporarily restricted contributions are required to be reported as temporarily restricted support and are then reclassified to unrestricted support upon the expiration of either time or use restrictions. B. Purpose and Activities of Significant Funding The following are descriptions of the significant funds of the National Alumni Association by function: Membership Services- consists of the following funds: Life Memberships Funds received from members for subscribing and fully paid life memberships. Life Membership Earnings- The fund is used to account for earnings from the investment of Life Membership Account. Scholarships- consist of the following funds: Restricted Scholarships- The fund is used to account for money received for scholarships earmarked for a particular student and/or program. Unrestricted Scholarships- The fund is used to account for money received for scholarships not earmarked for a particular student and/or program. University Support- consists of the following fund: Band Uniforms- The fund is used to account for funding received or band uniforms. 8

11 NOTES TO FINANCIAL STATEMENTS JUNE 30, 2008 and June 30, 2007 Management and General- consists of the following funds: Southeast Region The fund is used to account for funding from assessments on all chapters in the Southeast Region s various fundraisers. Winter Meeting- This fund is designed to receive and disburse funds for coordinating the annual Winter Meeting (and Convention). Monies left over are being used as seed money for the next annual conference. National Alumni Operating Account- The fund is used to account for the activities of the National Alumni. National Convention- The fund is used to account for the revenues and expenses associated with the National Alumni Association s Annual Convention. Florida Region- This fund is used to account for funds received from Florida Alumni chapters for the operation of the state association; transactions are initiated by the State President. Alumni Homecoming- This fund is designed to receive and disburse funds for coordinating the annual homecoming activities. Monies left over are being used as seed money for the following year s homecoming activities. FAMU Credit Union- The fund is used to account for unrestricted monies deposited with the FAMU Credit Union. Spring Meeting This fund is designed to receive and disburse funds for coordinating the Spring Meeting. Monies left over are being used as seed money for the following year s Spring Meeting. Alumni Housing Project- Funds received from the Alumni for the housing of students. 9

12 NOTES TO FINANCIAL STATEMENTS JUNE 30, 2008 and June 30, 2007 NOTE 1. DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES (Continued) C. Income Taxes The National Alumni Association is a non-profit corporation exempt from federal income taxes under Internal Revenue Code Section 501 (c) (3). However, income from certain activities not directly related to the Alumni s tax-exempt purpose is subject to taxation as unrelated business income. In addition, the National Alumni Association qualifies for the charitable contributions deduction under Section 170(b) (1) (A) and has been classified as an organization that is not a private foundation under Section 509 (a) (2). D. Affiliated Organizations The Florida A&M University Foundation, Inc. (the Foundation ), another direct support organization of the University, provides financial transaction processing services to the National Alumni Association at a fee of 2.50 per transaction. The University has other direct support alumni organizations, which operate for similar purposes. Such other organizations, as well as local alumni chapter activities, have not been included in these financial statements. E. Cash and Cash Equivalents For purposes of the statement of cash flows, the National Alumni Association considers cash in bank and short term investments with an original maturity of three months or less to be cash and cash equivalents. As of June 30, 2008 and June 30, 2007 there were no cash equivalents. F. 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 certain reported amounts and disclosures. 10

13 NOTES TO FINANCIAL STATEMENTS JUNE 30, 2008 and June 30, 2007 NOTE 2. EQUITY IN POOLED CASH Equity in pooled cash, in the amount of $1,226,626 and $1,291,179 as of June 30, 2008 and June 30, 2007, respectively, represents the National Alumni Association s equity in pooled assets held by the Foundation, which are reported as investments and considered temporarily restricted net assets in the Foundation s records. None of these balances are specifically insured on behalf of the National Alumni Association. NOTE 3. CONTRIBUTED FACILITIES AND SERVICES The National Alumni Association utilizes office space and personnel from the University in its operations. The amounts reflected in the financial statements for in-kind contributions are the fair market values of the facilities, services and materials that are provided. A detailed list of those amounts for the year ended June 30, 2008 follows: Wages and fringe 158,073 Occupancy 12,627 Telephone 1,500 Material & supplies 3,600 Total $ 175,800 NOTE 4. PERMANENTLY RESTRICTED ASSETS Permanently restricted assets of $6,979 are restricted to National Alumni Association Endowed Scholarship Fund. 11

14 NOTES TO FINANCIAL STATEMENTS JUNE 30, 2008 and June 30, 2007 NOTE 5. PROMISES TO GIVE Unconditional promises to give that are expected to be collected within one (1) year are recorded at net realizable value. Unconditional promises to give that are expected to be collected in future years are recorded at the present value of their estimated future cash flows. The discounts on those amounts are computed using the risk- free interest rates applicable to the years in which the promises are received. Amortization of discounts is included in contribution revenue. Conditional promises to give are not included as support until the conditions are substantially met. Unconditional promises to give as of June 30, 2008, consist of: Subscribing Life memberships 30,500 Less: Unamortized discount 556 Subtotal 29,944 Less: Allowance for uncollectibles 1,134 Net unconditional promises to give $ 28,810 Amount due in: Less than one (1) year 17,580 One to five (5) years 12,920 Total $ 30,500 Discount rate is four and a half percent (4.5%) while allowance for doubtful accounts approximates five percent (5%) of receivable accounts with no activity for a period of 18 months as of June 30, A reserve for uncollectible accounts was analyzed and an allowance in the amount of $ 1,134 was determined to be adequate for the delinquent accounts. Unconditional promises to give are a result of installment payments on life memberships. 12

15 NOTES TO FINANCIAL STATEMENTS JUNE 30, 2008 and June 30, 2007 NOTE 6. FAIR VALUE OF FINANCIAL INSTRUMENTS The following methods and assumptions were used to estimate the fair value of each class of financial instruments: Equity in Pooled Cash- Fair value approximates carrying value of each class of financial instruments being three months or less. Unconditional promises to give- Fair value approximates carrying value less unamortized discount and allowance for uncollectibles. The estimated fair values of the National Alumni Association s financial instruments at June 30, 2008 follow: Financial assets: Equity in Pooled Cash Unconditional promises to give -net Carrying Amount $ 1,226,626 28,810 Fair Value $ 1,226,626 28,810 NOTE 7. PRIOR PERIOD ADJUSTMENTS In May of 2007, The Florida A&M University National Alumni Association established the National Alumni Association Endowed Scholarship Fund. At the time of the gift, these funds were on deposit with The Florida A&M University Foundation in pooled cash. The September 30, 2007, financial statements which did not account for the gift have been restated to appropriately reflect the gift. 13

16 SUPPLEMENTAL SCHEDULE OF REVENUES AND EXPENSES BY FUNCTION FOR THE YEAR ENDED JUNE 30, 2008 Membership Services PROGRAM SERVICES Scholarships University Support Total Program Services Management & General Total SUPPORT In-Kind Contribution - 175, ,500 Dues and Life Membership 148, , ,885 Scholarships - Alumni, Chapters 126, , ,946 Gifts - Alumni, Friends & Students 41,484 41,484 41,484 Gifts - Corporation & Organizations 5,776 5,776 5,776 Investments and Dividends 41,214 8,375 49, ,598 Registrations,Conferences, Galas and Seminars - 16,655 16,655 TOTAL SUPPORT AND REVENUE 190, ,946 55, , , ,845 EXPENSES Scholarships and Grants 84,150 84,150 84,150 Salaries and Benefits - 158, ,073 Contractual Services - 13,500 13,500 Materials and Supplies 26,205 26,205 5,416 31,620 Travel, Conferences and Meetings - 11,336 11,336 Entertainment and Dinners - 19,153 19,153 Postage - 1,365 1,365 Credit Card, Bank and Check Charges - 10,037 10,037 Printing - 7,979 7,979 Occupacy - 12,627 12,627 Interest - - Telephone and Communications - 9,902 9,902 Advertising Equipment and Maintenance - - Taxes, Licenses and Insurance Bad Debt Expense Contributions to University 179, , ,914 TOTAL EXPENSES 26,205 84, , , , ,431 INCREASE / DECREASE IN NET ASSETS 163,894 42,796 (124,279) 82,411 (57,998) 24,413 14

17 SUPPLEMENTAL SCHEDULE OF REVENUES AND EXPENSES BY FUNCTION FOR THE YEAR ENDED JUNE 30, 2007 (Restated) Membership Services PROGRAM SERVICES Scholarships University Support Total Program Services Management & General Total SUPPORT In-Kind Contribution - 248, ,000 Dues and Life Membership 121, , ,905 Scholarships - Alumni, Chapters 71,800 10,880 82,680 82,680 Gifts - Alumni, Friends & Students 30,609 30,609 30,609 Gifts - Corporation & Organizations 15,873 15,873 15,873 Investments and Dividends 31,692 31,692 31,692 Registrations,Conferences, Galas and Seminars - 16,420 16,420 Advertisement Revenue - - Rental Income and Paraphernelia TOTAL SUPPORT AND REVENUE 153,597 71,800 57, , , ,230 EXPENSES Scholarships and Grants 70,500 70,500 70,500 Salaries and Benefits - 228, ,140 Honorarium - - Contractual Services - 13,055 13,055 Materials and Supplies 9,250-9,250 7,019 16,269 Travel, Conferences and Meetings - 29,772 29,772 Entertainment and Dinners - - Postage 1,206 1,206 5,681 6,888 Credit Card, Bank and Check Charges ,152 1,480 Administrative Fee - Gifts - - Printing - 22,349 22,349 Equipment Rental - - Occupacy - 15,160 15,160 Interest Telephone and Communications - 13,194 13,194 Advertising Equipment and Maintenance - - Taxes, Licenses and Insurance Bad Debt Expense 1,175 1,175 1,175 Contributions to University 152, , ,150 TOTAL EXPENSES 11,960 70, , , , ,586 INCREASE / DECREASE IN NET ASSETS 141,637 1,300 (94,788) 48,149 (71,505) (23,356) 15

18 Grayson Accounting & Consulting, P.A. 118 Salem Court, Suite B P.O. Box / Tallahassee, FL Telephone (850) / Facsimile (850) 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 Florida A&M University National Alumni Association Tallahassee, Florida We have audited the financial statements of Florida A&M University National Alumni Association as of and for the year ended June 30, 2008 and June 30, 2007, and have issued our report thereon dated November 9, We conducted our 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. Internal Control Over Financial Reporting In planning and performing our audit, we considered the Florida A&M University National Alumni Association s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Florida A&M University National Alumni Association s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Florida A&M University National Alumni Association s internal control over financial reporting. A control deficiency 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 misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the entity s financial statements that is more than inconsequential will not be prevented or detected by the entity s internal control. Member Florida Institute of Certified Public Accountants / American Institute of Certified Public Accountants

19 A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the entity s internal control. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Florida A&M University National Alumni Association s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grants, 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 our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. This report is intended for the information and use of the Audit and Finance Committee of the Florida A&M University National Alumni Association s Board of Directors, Florida A&M University s Board of Trustees, and the Florida A&M University National Alumni Association s management and is not intended to be and should not be used by anyone other than these specified parties. Grayson Accounting & Consulting, P.A. Tallahassee, Florida August 21, Member Florida Institute of Certified Public Accountants / American Institute of Certified Public Accountants