FINANCIAL STATEMENTS Years Ended December 31, 2013 and 2012
Western New York Section of The PGA Index As of December 31, 2013 and 2012 Financial Statements Statement of Financial Position.......... 1 Statement of Activities........2 Statement of Cash Flows........ 3 Supplemental Information 4 5 Notes to Combined Financial Statements........ 6-11
Western New York Section of The PGA Statements of Financial Position December 31, 2013 and 2012 Assets Current Assets: Cash and cash equivalents $ 284,185 $ 74,177 Accounts receivable 16,617 17,832 Prepaid expenses - 960 Deposits 2,000 - Total current assets 302,802 92,970 Property and equipment, net 257,776 254,358 Total assets $ 560,578 $ 347,327 Liabilities and Net Assets Current Liabilities: Accounts payable and accrued expenses $ 56,848 $ 5,530 Current portion of long-term debt 18,136 14,186 Current portion of deferred revenues 76,985 76,766 Total current liabilities 151,968 96,481 Long-term debt 57,608 79,288 Total liabilities 209,576 175,769 Total net assets 351,001 171,557 Total liabilities and net assets $ 560,578 $ 347,327 The accompanying notes are an integral part of these financial statements. 1
Statements of Activities Increase Increase Section Activities Revenue Expense (Decrease) Revenue Expense (Decrease) Tournaments $ 299,430 $ 285,876 $ 13,554 $ 296,658 $ 281,422 $ 15,236 Foundation Programs 292,670 126,757 165,913 12,850 6,837 6,013 Junior Golf 76,440 66,506 9,933 70,940 57,094 13,846 Membership 71,497 22,288 49,209 65,458 17,474 47,984 General & administration 150,997 210,162 (59,165) 125,792 209,916 (84,121) Increase (decrease) in net assets $ 891,034 $ 711,589 $ 179,443 $ 571,698 $ 572,743 $ (1,045) The accompanying notes are an integral part of these financial statements. 2
Western New York Section of The PGA Statements of Cash Flows Cash flows from operating activities Increase (decrease) in unrestricted net assets $ 179,443 $ (1,045) Adjustments to reconcile unrestricted net assets to net cash provided by operating activties Depreciation 17,513 16,259 Change in net assets Decrease (increase) in accounts receivable 1,215 (2,161) Decrease in prepaid expenses 960 7,253 Increase in deposits (2,000) - Increase in accounts payable 51,318 1,184 Increase in deferred revenues 219 1,178 Net cash provided by operating activities 248,668 22,668 Cash flows from investing activities Purchases of property and equipment (21,047) (4,260) Net cash used in investing activities (21,047) (4,260) Cash flows from financing activities Repayment of long term debt (17,612) (16,664) Net cash used in financing activities (17,612) (16,664) Net increase in cash and cash equivalents 210,009 1,744 Cash and cash equivalents Beginning of year 74,177 72,434 December 31, 2013 and 2012 $ 284,185 $ 74,177 Supplemental Disclosure of Cash Flow Information Interest paid $ 5,861 $ 8,363 The accompanying notes are an integral part of these financial statements. 3
Western New York Section Supplemental Information Schedule Statements of Financial Position December 31, 2013 Section Foundation Total Assets Current Assets: Cash and cash equivalents $ 284,185 $ - $ 284,185 Accounts receivable 16,617-16,617 Deposits 2,000-2,000 Total current assets 302,801-302,802 Due from affiliates (170,044) 170,044 - Property and equipment, net 257,776-257,776 Total assets $ 390,534 $ 170,044 $ 560,578 Liabilities and Net Assets Current Liabilities: Accounts payable and accrued expenses $ 56,848 $ - $ 56,848 Current portion of long-term debt 18,136-18,136 Current portion of deferred revenues 76,985-76,985 Total current liabilities 151,968-151,968 Long-term debt 57,608-57,608 Total liabilities 209,576-209,576 Total net assets 180,957 170,044 351,001 Total liabilities and net assets $ 390,534 $ 170,045 $ 560,577 The accompanying notes are an integral part of these financial statements. 4
Western New York Section Supplemental Information Schedule Statements of Activities Section Foundation Combined Increase Increase Increase Section Activities Revenue Expense (Decrease) Revenue Expense (Decrease) Revenue Expense (Decrease) Tournaments $ 299,430 $ 285,876 $ 13,554 $ - $ - $ - $ 299,430 $ 285,876 $ 13,554 Foundation Programs - - - 292,670 126,757 165,913 $ 292,670 $ 126,757 165,913 Junior Golf 76,440 66,506 9,933 - - - $ 76,440 $ 66,506 9,933 Membership 71,497 22,288 49,209 - - - $ 71,497 $ 22,288 49,209 General & administration 150,997 210,162 (59,165) - - - $ 150,997 $ 210,162 (59,165) Increase in net assets $ 598,364 $ 584,832 $ 13,531 $ 292,670 $ 126,757 $ 165,910 $ 891,034 $ 711,589 $ 179,443 The accompanying notes are an integral part of these financial statements. 5
Notes to Financial Statements 1. Significant Accounting Policies Principles of Consolidation The financial statements include the financial statements of the Western New York Section of The PGA, ( The Western New York Section, a 501(c)(6), non-profit, tax-exempt organization). Affiliated Party The Western New York Section is chartered by the PGA of America. Under the PGA of America s constitution, all members of the PGA of America must belong to both the National Association and the local Section. The PGA of America is a separate 501(c)(6) organization. The PGA s governance system is designed so that the 41 sections, including the Western New York Section, select the Board of Directors for the National Association. Revenue Recognition Revenue from tournaments is recognized when the event takes place. Revenue from member dues is recognized ratably during the year to which it relates. Revenue from all other activities is recognized at the time goods or services are provided. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation of property and equipment is determined on a straight-line basis over the estimated useful lives of the assets as follows: Building Leasehold Improvements Furniture and fixtures Computer equipment Equipment Automobiles 39 years 15 years 7 years 5 years 5 years 5 years Deferred Revenue and Prepaid Expenses Revenue received in advance of an event is deferred until such time as the event takes place. Costs incurred relating to such events are similarly recorded as prepaid expenses and later recognized with the related revenues. 6
Notes to Financial Statements Income Taxes The Western New York Section is exempt from federal and state income tax for activities related to its respective tax-exempt purposes. Provision for unrelated business income tax, when applicable, is made for activities unrelated to the stated tax-exempt purposes of the entities. Use of Estimates The preparation of financial statements in accordance 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. 2. Accounts Receivable Accounts receivable consists of the following: Entry fees and sponsorships $ 16,617 $ 12,402 PGA of America reimbursements - 1,984 Other - 3,447 Total $ 16,617 $ 17,832 3. Prepaid Expenses Prepaid expenses consist of the following: Staff travel $ - $ 852 State disability insurance - 108 Total $ - $ 960 7
Notes to Financial Statements 4. Deposits Deposits consist of the following: Las Vegas deposits $ 2,000 $ - 5. Property and Equipment Property and equipment consists of the following: Building $ 290,765 $ 290,765 Automobiles 37,263 37,263 Land 20,000 20,000 Leasehold/Building Improvement 19,805 - Furniture and fixtures 19,246 19,246 Computer equipment 9,035 7,793 Equipment 3,274 3,274 399,388 378,341 Less: accumulated depreciation (141,613) (123,984) $ 257,776 $ 254,358 Depreciation expense related to these assets for years ended December 31, 2013 and 2012 was $17,513 and $16,259. 6. Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities consist of the following: Accounts payable $ 53,502 $ 2,833 Property Insurance Accrual 2,795 - Accrued expenses 333 2,517 Deposit & overpayment 180 180 Refunds 37 - Total $ 56,848 $ 5,530 8
Notes to Financial Statements 7. Deferred Revenue Deferred revenue consists of the following: ADP funding $ 45,000 $ 45,000 Membership dues 28,775 27,090 Sponsorship revenue 3,000 4,326 Other 210 - Entry Fees - 350 Total $ 76,985 $ 76,766 8. (Due To) /Due From The Western New York Section operates membership programs through the Western New York PGA Foundation. For accounting purposes, the Western New York PGA Foundation activity is recorded in separate funds within the Western New York Section books. In consolidation, these fund balances are eliminated. At December 31, 2013 and 2012, the fund balances are as follows: Western New York Foundation $ 170,044 $ 4,132 9
Notes to Financial Statements 9. Related Party Transactions The PGA of America provides monetary and non-monetary support for the Western New York Section. The non-monetary items include the following: the section loan program, the section insurance program, collection of member dues, accounting services, communication and national sponsorships. The Western New York Section received direct monetary support from The PGA of America as follows: ADP funding $ 90,000 $ 90,000 PGA Reach ProAm 50,000 - PGA 2013 Championship 25,000 - PGA Tour 13,700 14,400 PGA Professional Championship 13,362 14,526 Section royalties 5,549 5,735 PGA Annual Meeting 4,823 4,865 Executive Director Car Program 4,500 4,500 Assistant Team Championship 3,265 5,908 PGA Resort & Spa 3,000 2,912 Executive Director Conference 2,526 - Section Short Game Challenge 1,500 - District Candidate meeting 1,058 1,450 JaniKing 1,000 - PGA Sr Championship 718 - Fall Leadership Conference - 561 PGA Callaway Sponsorship - 5,908 Total $ 220,001 $ 150,765 10
Notes to Financial Statements 10. Long-term Debt Mortgage note payable to bank, principal and interest payments (interest rate of 6.75%) due monthly through October 1, 2018 $ 67,810 Automobile loan payable to PGA Credit Union, principal and interest payments (interest rate of 5.74%) due monthly through May 1, 2015 7,934 Total debt 75,744 Less: Current portion (18,136) Long term portion $ 57,608 During the years ended December 31, 2013 and 2012, interest expense related to the borrowings was $5,861 and $8,363. Aggregate maturities of long-term debt, including the current portion, at December 31, 2013 for the next five years and thereafter are as follows: 2014 $ 18,136 2015 16,365 2016 15,517 2017 16,810 2018 8,918 Total $ 75,744 11