Connecticut Community Providers Association, Inc.

Transcription

1 Connecticut Community Providers Association, Inc. Independent Auditors Report, Financial Statements and Supplemental Schedules As of and for the Years Ended June 30, 2014 and 2013

2 Independent Auditors Report, Financial Statements and Supplemental Schedules As of and for the Years Ended June 30, 2014 and 2013 Table of Contents Independent Auditors Report... 1 Financial Statements: Statements of Financial Position... 3 Statements of Activities and Changes in Net Assets... 4 Statements of Cash Flows... 5 Notes to the Financial Statements... 6 Supplemental Schedules: Schedule of Grants for the Year Ended June 30, Schedule of Expenses for the Years Ended June 30, 2014 and Page

3 Accounting Tax Advisory To the Board of Directors of the Connecticut Community Providers Association, Inc.: Independent Auditors Report We have audited the accompanying financial statements of the Connecticut Community Providers Association, Inc. (the Organization), which comprise the statements of financial position as of June 30, 2014 and 2013, and the related statements of activities and changes in net assets and cash flows for the years then ended. 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. Auditors Responsibility 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. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Connecticut Community Providers Association, Inc. as of June 30, 2014 and 2013, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America. HARTFORD, CT BURLINGTON, VT PHOENIX, AZ

4 Accounting Tax Advisory Report on Supplementary Information Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole. The schedule of grants and expenses on pages 10 and 11, respectively, are presented for the purpose of additional analysis and are not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information had been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole. October 24, 2014 Simsbury, Connecticut 2

5 Statements of Financial Position June 30, 2014 and Assets Current assets: Cash and cash equivalents $ 1,036,345 $ 648,062 Certificates of deposit 201, ,285 Accounts receivable - contracts, less allowance for doubtful accounts of $65,827 (2014) and $60,191 (2013) 838, ,785 Membership dues receivable 12,160 14,125 Accounts receivable - other 720 9,937 Prepaid expenses and other current assets 25,038 12,031 Total current assets 2,114,106 1,685,225 Property and equipment: Building 230, ,742 Furniture and equipment 109, ,713 Building improvements 153, , , ,078 Less: accumulated depreciation (280,034) (294,487) Property and equipment, net 213, ,591 Total assets $ 2,327,552 $ 1,903,816 Liabilities and Net Assets Liabilities: Accounts payable - contracts $ 1,037,963 $ 755,625 Deferred revenue - dues 305, ,281 Accounts payable other and accrued expenses 218, ,670 Deferred revenue - other 14,347 28,868 Assessment liability 17,860 20,409 Total liabilities 1,595,016 1,255,853 Net assets: Unrestricted - undesignated 721, ,890 Unrestricted - board designated for capital reserves 10,577 12,073 Total net assets 732, ,963 Total liabilities and net assets $ 2,327,552 $ 1,903,816 The accompanying notes are an integral part of these financial statements. 3

6 Statements of Activities and Changes in Net Assets For the Years Ended June 30, 2014 and Support and revenue: Fees for services $ 7,268,805 $ 7,494,257 Membership dues 608, ,996 Conference income 116, ,296 Grants 82,162 83,388 Total support and revenue 8,076,044 8,303,937 Other income: Interest 2,899 1,382 Miscellaneous 29,969 24,267 Total other income 32,868 25,649 Total support, revenue and other income 8,108,912 8,329,586 Expenses 8,024,339 8,244,607 Change in net assets 84,573 84,979 Net assets, beginning of year 647, ,984 Net assets, end of year $ 732,536 $ 647,963 The accompanying notes are an integral part of these financial statements. 4

7 Statements of Cash Flows For the Years Ended June 30, 2014 and Cash flows from operating activities: Change in net assets $ 84,573 $ 84,979 Adjustments to reconcile change in net assets to net cash provided by operating activities: Depreciation 19,472 20,894 Bad debt expense 5,000 - Changes in operating assets and liabilities: Accounts receivable - contracts, net (142,628) 184,364 Membership dues receivable 1,965 (29) Accounts receivable - other 9,217 3,455 Prepaid expenses and other current assets (13,007) 15,980 Accounts payable - contracts 282,338 (178,454) Deferred revenue - dues 3,636 2,367 Accounts payable other and accrued expenses 70,259 (53,090) Deferred revenue - other (14,521) 6,165 Net cash provided by operating activities 306,304 86,631 Cash flows from investing activities: Purchases of equipment (14,327) (7,645) Proceeds from the maturity of certificate of deposit 98,855 - Purchases of certificates of deposits - (300,285) Net cash provided by (used in) investing activities 84,528 (307,930) Cash flows from financing activities: Repayments on assessment liability (2,549) (2,622) Net cash used in financing activities (2,549) (2,622) Change in cash and cash equivalents 388,283 (223,921) Cash and cash equivalents, beginning of year 648, ,983 Cash and cash equivalents, end of year $ 1,036,345 $ 648,062 The accompanying notes are an integral part of these financial statements. 5

8 Notes to the Financial Statements As of and for the Years Ended June 30, 2014 and 2013 Note 1 - Organization Connecticut Community Providers Association, Inc., (the Organization) is a tax-exempt, nonprofit organization established to be a resource to and advocate for community providers in advancing their delivery of high quality, efficient and effective health and human services. The Organization strives to achieve positive human service systems change in the public policy arena. The Organization also assists the State of Connecticut in providing and developing a market for products made and services rendered by people with disabilities. Note 2 - Significant Accounting Policies Basis of Presentation - The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), as promulgated by the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC). The Organization reports information regarding its financial position and activities according to three classes of net assets: unrestricted, temporarily restricted and permanently restricted. They are described as follows: Unrestricted - Net assets that are not subject to explicit donor-imposed stipulations. Unrestricted net assets may be designated for specific purposes by action of the Board of Directors. Temporarily Restricted - Net assets whose use by the Organization is subject to explicit donor-imposed stipulations that can be fulfilled by actions of the Organization or that expire by the passage of time. The Organization currently has no temporarily restricted net assets. Permanently Restricted - Net assets whose use by the Organization is subject to explicit donor-imposed stipulations that they be maintained permanently by the Organization and stipulate the use of income and/or application as either unrestricted or temporarily restricted. The Organization currently has no permanently restricted net assets. Use of Estimates - The preparation of financial statements in conformity with GAAP 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 - Cash and cash equivalents include highly liquid investments with maturities of three months or less when purchased. In general, the Federal Deposit Insurance Corporation (FDIC) insures cash balances up to $250,000 per depositor, per bank. It is the Organization s policy to monitor the financial strength of the banks that hold its deposits on an ongoing basis. During the normal course of business, the Organization maintains cash balances in excess of the FDIC insurance limit. Certificates of Deposit - The Organization holds two certificates of deposit with maturity dates of October 18, 2014 and May 1, The certificates of deposit are carried based on the amount deposited in the account, plus interest. The certificates of deposit are subject to early withdrawal penalties. These certificates of deposit are insured by the FDIC and are subject to the $250,000 limit per depositor, per bank. Accounts Receivable - Management has established an allowance for doubtful accounts for potential credit losses based on a review of significant balances and past experience. Accounts receivable as of June 30, 2014 and 2013, are net of allowance for doubtful accounts of $65,827 and $60,191, respectively. Bad debt expense for the years ended June 30, 2014 and 2013 was $5,000 and $0, respectively. 6

9 Note 2 - Significant Accounting Policies (continued) Connecticut Community Providers Association, Inc. Notes to the Financial Statements As of and for the Years Ended June 30, 2014 and 2013 Recognition of Grant Support - The Organization recognizes grant support to the extent that eligible grant costs are incurred. Receivables are recognized to the extent costs have been incurred but not reimbursed. Deferred revenue represents grant advances that exceed eligible costs incurred. Grants require the fulfillment of certain conditions as set forth in the instrument of the grant. Failure to fulfill the conditions could result in the return of funds to grantors. At June 30, 2014 and 2013, management of the Organization was unaware of any noncompliance with grant requirements. Property and Equipment - The Organization capitalizes all expenditures for property and equipment in excess of $1,000. Property and equipment is recorded at cost unless it is a donated item. Donated items are recorded at their fair market value at the date of the donation. Depreciation of property and equipment is charged against income over estimated useful lives ranging from 5 to 40 years using the straight-line method. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in income for the period. Revenue - Membership dues are recognized as revenue in the applicable membership period, which is on a calendar-year basis. Therefore, one-half of the 2014 and 2013 dues have been recognized as revenue for the year ended June 30, Expenses by Function - The costs providing various programs and activities have been summarized on a functional basis in Note 7. Accordingly, certain costs have been allocated among the programs and supporting services benefited. The allocations are based upon square footage for occupancy related items and labor hours incurred for salary related items in each of the cost centers. Contributions - Contributions received are recorded as unrestricted, temporarily restricted or permanently restricted support depending on the existence and/or nature of any donor restrictions. Support that is restricted by the donor is reported as an increase in unrestricted net assets if the restriction expires in the reporting period in which the support is recognized. All other donor-restricted support is reported as an increase in temporarily restricted or permanently restricted net assets, depending on the nature of the restriction. When a restriction expires, that is, when a stipulated time restriction 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. Income Taxes - The Organization has been recognized by the Internal Revenue Service as a not-for-profit corporation as described in section 501(c)(3) of the Internal Revenue Code and is exempt from federal income taxes on related income. The Organization accounts for uncertain tax positions in accordance with certain provisions of FASB ASC 740, Income Taxes, which provide a framework for how companies should recognize, measure, present and disclose uncertain tax positions in their financial statements. Under FASB ASC 740, the Organization may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. 7

10 Note 2 - Significant Accounting Policies (continued) Connecticut Community Providers Association, Inc. Notes to the Financial Statements As of and for the Years Ended June 30, 2014 and 2013 The tax benefits recognized in the financial statements from such position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Organization does not have any uncertain tax positions as of June 30, 2014 and As of June 30, 2014 and 2013, the Organization did not record any penalties or interest associated with uncertain tax positions. The Organization s informational returns for the prior three years are open and subject to examination by the Internal Revenue Service. Subsequent Events - Subsequent events have been evaluated through October 24, 2014, which is the date the financial statements were available to be issued. Management believes there are no subsequent events having a material impact on the financial statements. Note 3 - Concentrations of Credit Risk Financial instruments that potentially subject the Organization to concentrations of credit risk consist principally of temporary cash investments and receivables. The Organization maintains its temporary cash investments in bank deposit accounts that, at times, may exceed federally insured limits. The Organization has not experienced any losses in such accounts. The Organization believes it is not exposed to any significant credit risk on cash or cash equivalents. The Organization develops and monitors product and service contracts, coordinates education and training programs, provides technical assistance, serves as legislative and administrative advocates, assists with marketing techniques and operates a job bank and resource library for its members who are located throughout Connecticut. Accounts receivable from member organizations in Connecticut was $12,160 and $14,125, at June 30, 2014 and 2013, respectively. Accounts receivable from service contracts, less allowance for doubtful accounts, was $838,413 and $700,785 at June 30, 2014 and 2013, respectively. Note 4 - Related Party Transactions During the years ended June 30, 2014 and 2013, the Organization contracted for services with several organizations that have common directors. Details regarding transactions with these related parties are as follows: Expense Incurred Included in Accounts Payable Expense Incurred Included in Accounts Payable ARC of Meriden-Wallingford $ 118,619 $ 17,532 $ - $ - BHcare, Inc. 21,527-21,529 - Community Mental Health Affiliates 9,359-9,360 - ARC of New London County 6,351 1,050 6,249 1,575 HARC, Inc. 5, ARI of Connecticut 2, ,849 - Community Health Resources 15,912-15,914 - Total $ 179,547 $ 19,262 $ 55,901 $ 1,575 8

11 Notes to the Financial Statements As of and for the Years Ended June 30, 2014 and 2013 Note 5 - Operating Lease The Organization leases office equipment under noncancelable operating leases. The Organization is responsible for maintenance, taxes and insurance under the leases. The following is a schedule of future minimum rentals as of June 30, 2014: Year Ending June $ 12, , ,865 Total $ 27,553 Rent expense was $12,344 and $10,691, respectively for the years ended June 30, 2014 and Note 6 - Tax-Sheltered Annuity Program The Organization maintains an employer contributory tax-sheltered annuity program for all eligible employees. An employee is eligible for participation upon hire. An employee is eligible to receive an employer contribution after 1 year of service and the completion of 1,000 hours of service during the plan year. The Organization matches dollar for dollar of an employee s contribution up to 3% of an employee s salary. After 10 years of employment, the Organization matches dollar for dollar of an employee s contribution up to 5% of an employee s salary. For employees hired prior to January 1, 2010, all contributions are 100% vested. Employees that are hired after January 1, 2010 are subject to a six-year graded vesting plan. Tax-sheltered annuity expense for the years ended June 30, 2014 and 2013 was $8,816 and $15,463, respectively. Note 7 - Expenses by Function Expenses by function for the years ended June 30, 2014 and 2013 are as follows: Member services $ 819,172 $ 814,473 Preferred purchasing 7,125,065 7,347,085 Case management 80,102 83,049 Total $ 8,024,339 $ 8,244,607 9

12 Schedule of Grants For the Year Ended June 30, 2014 Case Program Contract Number Management Total Department of Social Services: Case Management 119-CMCSBG-20 $ 82,162 $ 82,162 See accompanying independent auditors report. 10

13 Schedules of Expenses For the Years Ended June 30, 2014 and Preferred purchasing program subcontractors $ 6,664,161 $ 6,818,629 Salaries 718, ,706 Professional fees 116,652 97,236 Employee health benefits 80,013 66,648 Case management subcontractors 70,403 71,142 Conference expenses 54,105 49,023 Payroll taxes 51,512 55,457 Annual meeting 44,710 28,995 Other 23,361 - Condominium fee 22,290 22,290 Depreciation and amortization 19,472 20,894 Leased equipment 15,661 13,943 Contracted services 14, ,208 Dues and memberships 13,411 7,705 Computer software and supplies 13,278 - Insurance 12,218 12,282 Utilities 11,925 11,635 Travel 10,916 16,241 Community providers initiative 9,247 30,836 Equipment and repairs 9,181 1,131 Tax-sheltered annuity program 8,816 15,463 Office supplies 7,129 5,035 Telephone 6,887 6,128 Postage and mailing 6,077 6,604 Bank fees 5,533 6,792 Bad debt 5,000 - Miscellaneous 4,565 9,348 Interest 1,547 1,474 Advertising 1,278 1,397 Printing 901 2,882 Office equipment service contracts Publications $ 8,024,339 $ 8,244,607 See accompanying independent auditors report. 11