SUDDEN INFANT DEATH SYNDROME RESOURCES, INC. FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS' REPORT FOR THE YEARS ENDED SEPTEMBER 30, 2015 AND 2014
CONTENTS Page INDEPENDENT AUDITORS' REPORT... 1-2 FINANCIAL STATEMENTS Statements of Financial Position... 3 Statements of Activities... 4 Statements of Functional Expenses... 5-6 Statements of Cash Flows... 7 Notes to Financial Statements... 8-12
Sc E HL R Certified Public Accountants Independent Auditors' Report Board of Directors Sudden Infant Death Syndrome Resources, Inc. St. Louis, Missouri We have audited the accompanying financial statements of Sudden Infant Death Syndrome Resources, Inc. d/b/a SIDS Resources, Inc., (a nonprofit corporation), ("SIDS Resources, Inc."), which comprise the statements of financial position as of September 30, 2015 and 2014, and the related statements of activities, functional expenses and cash flows for the years then ended, and the related notes to the financial statements. 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 misstatements whether due to fraud or error. Auditors' Responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' 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 polices used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. (314) 966-2727 e1 fax (314) 966-6464 '"10805 Sunset Office Drive, Suite 400 St. Louis, MO 63127'" e-mail: stcpa@stcpa.com
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 SIDS Resources, Inc. as of September 30, 2015 and 2014, 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. St. Louis, Missouri February 23, 2016 (2)
FINANCIAL STATEMENTS
STATEMENTS OF FINANCIAL POSITION ASSETS Se12tember 30, 2015 2014 CURRENT ASSETS Cash and cash equivalents $ 14,192 $ 54,592 United Way receivable 23,360 15,150 Grants receivable 25,100 3,641 Prepaid expenses 588 Total Current Assets 62,652 73,971 Deposits 2,050 2,000 PROPERTY AND EQUIPMENT, net 13,192 Total Assets $ 77,894 $ 75,971 LIABILITIES AND NET ASSETS LIABILITIES Accounts payable $ 7,719 $ 2,127 Accrued expenses 6,381 8,434 Total Current Liabilities 14,100 10,561 NET ASSETS Unrestricted 26,753 28,066 Temporarily restricted 37,041 37,344 Total Net Assets 63,794 65,410 Total Liabilities and Net Assets $ 77,894 $ 75,971 See accompanying notes to financial statements (3)
STATEMENTS OF ACTIVITIES Year Ended September 30, 2015 Temporarily U nrestri ct eel Restricted Total Public Support and Revenue Grants and contributions 101,412 $ 25,902 $ 127,314 Special events, net of direct expenses of $12,590 and $30,513, respectively 32,535 32,535 United way contributions 65,995 29,955 95,950 Miscellaneous income 12,915 12,915 In-kind contributions 17,084 17,084 Satisfaction of program restrictions 56,160 ( 56,160) Total Public Support and Revenue 286,101 ( 303) 285,798 EXPENSES Program Services Education 170,116 170,116 Bereavement 79,385 79,385 Total Program Services 249,501 249,501 Supporting Services Management and general 18,068 18,068 Fundraising 19,845 19,845 Total Supporting Services 37,913 37,913 Total Expenses 287,414 287,414 CHANGE IN NET ASSETS ( 1,313) ( 303) ( 1,616) NET ASSETS, Beginning of year 28,066 37,344 65,410 NET ASSETS, End of year $ 26,753 $ 37,041 $ 63,794 See accompanying notes to financial statements (4)
Year Ended September 30, 2014 Temporarily Unrestricted Restricted Total 67,823 $ 26,775 $ 94,598 83,672 52,797 3,846 557 37,944 15,150 ( 37,944) 83,672 67,947 3,846 557 246,639 3,981 250,620 138,076 64,435 138,076 64,435 202,511 202,511 12,065 16,108 12,065 16,108 28,173 28,173 230,684 230,684 15,955 3,981 19,936 12,111 33,363 45,474 $ 28,066 $ 37,344 $ 65,410
STATEMENT OF FUNCTIONAL EXPENSES Year Ended September 30, 2015 Program Services SU Ortin~ Services Management Fund- Education Bereavement Subtotal and General raising Total Salaries $ 110,531 $ 51,581 $ 162,112 $ 9,211 $ 12,895 $ 184,219 Employee benefits 8,984 4,192 13,176 749 1,048 14,973 Total Salaries and Related Expenses 119,515 55,773 175,288 9,960 13,943 199,192 Bad debt expense Communication 1,970 920 2,890 164 230 3,284 Depreciation - - - 258-258 Equipment rental 869 405 1,274 72 101 1,447 In-kind donations - - - 3,634-3,634 Insurance 4,067 1,898 5,965 339 475 6,779 Miscellaneous 2,103 981 3,084 175 245 3,504 Office supplies 1,458 680 2,138 122 170 2,430 Postage 1,188 554 1,742 99 139 1,980 Printing 218 101 319 18 25 362 Professional fees and consulting 7,818 3,648 11,466 651 912 13,029 Program supplies 17,945 8,374 26,319 1,495 2,092 29,906 Rent 10,812 5,046 15,858 901 1,261 18,020 Travel 2,123 991 3,114 177 248 3,539 Utilities 30 14 44 3 4-50 Total Expenses $ 170,116 $ 79,385 $ 249,501 $ 18,068 $ 19,845 $ 287,414 = See accompanying notes to financial statements (5)
STATEMENT OF FINANCIAL POSITION Year Ended September 30, 2014 Program Services Supporting Services Management Fund- Education Bereavement Subtotal and General raising Total Salaries $ 92,085 $ 42,973 $ 135,058 $ 7,674 $ 10,743 $ 153,475 Employee benefits 7,443 3,473 10,916 621 868 12,405 Total Salaries and Related Expenses 99,528 46,446 145,974 8,295 11,611 165,880 Bad Debt Expense 232 108 340 20 27 387 Communication 2,129 994 3,123 178 248 3,549 Depreciation Equipment rental 991 462 1,453 82 116 1,651 In-kind donations - - - 557-557 Insurance 4,678 2,183 6,861 390 546 7,797 Miscellaneous 1,285 600 1,885 107 150 2,142 Office supplies 14 7 21 1 2 24 Postage 347 162 509 29 40 578 Printing 300 140 440 25 35 500 Professional fees and consulting 10,738 5,011 15,749 895 1,253 17,897 Program supplies 5,670 2,646 8,316 473 661 9,450 Rent 9,875 4,608 14,483 823 1,152 16,458 Travel 2,221 1,036 3,257 185 259 3,701 Utilities 68 32 100 5 8-113 Total Expenses $ 138,076 $ 64,435 $ 202,511 $ 12,065 $ 16,108 $ 230,684 See accompanying notes to financial statements (6)
STATEMENTS OF CASH FLOWS CASH FLOWS FROM OPERATING ACTIVITIES Change in net assets ($ 1,616) Adjustments to reconcile change in net assets to net change in cash and cash equivalents from operating activities: Depreciation expense 258 Donated fixed assets included in in-kind contributions ( 13,450) (Increase) decrease in assets: Grants receivable ( 21,459) United Way receivable ( 8,210) Prepaid expenses 588 Deposits ( 50) Increase (decrease) in liabilities: Accounts payable 5,592 Accrued expenses ( 2,053) Years Ended SeEtember 30, 2015 2014 $ 19,936 18,098 ( 1,251) 5,679 ( 6,582) 3,048 Net Change in Cash and Cash Equivalents from Operating Activities ( 40,400) 38,928 CASH AND CASH EQUIVALENTS, Beginning of year 54,592 15,664 CASH AND CASH EQUIVALENTS, End of year $ 14,192 $ 54,592 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the year for: Interest $ $ Noncash investing activities include receiving various fixed assets from another non-for-profit organization $ 13,450 $ See accompanying notes to financial statements (7)
NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization SIDS Resources, Inc. (the "Organization") is a nonprofit organization that provides services relating to Sudden Infant Death Syndrome. Basis of Accounting The financial statements of the Organization are prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America. Financial Statement Presentation The Organization's resources are classified for accounting and reporting purposes into three asset categories according to externally donor imposed restrictions. A description of the three net asset categories is as follows: Unrestricted Net Assets - Represent those net assets whose use is not restricted by donors. All contributions are considered to be available for unrestricted use unless specifically restricted by the donor. Included in unrestricted net assets are Board Designated net assets for which the governing board, rather than a donor or other outside agency, has designated net assets to be reserved. The Board is not bound by these designations and may adjust them as they deem necessary. Temporarily Restricted Net Assets - Represent those net assets whose use has been limited by donor-imposed stipulations that specify expenditures, expire by passage of time, or can be fulfilled and removed by actions of the Organization's board pursuant to those stipulations. Permanently Restricted Net Assets - Represent those net assets that must be maintained in perpetuity, the income of which is to be used by the Organization for specific programmatic uses. For the years ending September 30, 2015 and 2014, the Organization does not have net assets that qualify as permanently restricted. Functional Expenses The Organization allocates its expenses on a functional basis to 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 expense classification. Other expenses that are common to several functions are primarily allocated based on payroll allocations and management estimates. (8)
NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 (Continued) A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Cash and Cash Equivalents The Organization considers all highly liquid investments purchased with a maturity of three months or less to be cash equivalents. The Organization maintains its cash balances in a financial institution which, at times, may exceed federally insured limits. Bank balances are insured by the Federal Deposit Insurance Corporation (FDIC) of up to $250,000 at each financial institution. The Organization has not experienced any losses in such accounts and does not believe it is exposed to any significant credit risk on cash. Grants and United Way Receivables Grants and United Way receivables are reported at the amount management expects to collect on balances outstanding at year-end. Management closely monitors outstanding balances and writes off, as of year-end, all balances that are deemed to be uncollectible. Property and Equipment Purchased property and equipment are recorded at cost or, if donated, at fair market value at the date of the gift. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets. Expenditures for repairs and maintenance are charged to operations while renewals and betterments are capitalized. Use of Estimates The preparation of the financial statements in conformity with accounting principles in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results could differ from those estimates. Revenue Recognition Contributions are recognized when the donor makes a promise to give to the Organization that is, in substance, unconditional. Contributions restricted by the donor are reported as increases in unrestricted net assets if the restrictions expire in the fiscal year in which the contributions are recognized. All other donor-restricted contributions are reported as increases in temporarily or permanently restricted net assets depending on the nature of the restrictions. When a restriction expires, temporarily restricted net assets are reclassified to unrestricted net assets. (9)
NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 (Continued) A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Income Taxes The Organization qualifies as a nonprofit organization and is exempt from federal and state income taxes under Section 501 ( c )(3) of the Internal Revenue Code. The Organization does not have unrelated business income, excise taxes, or activities that would threaten the Organizations tax-exempt status. Accordingly, no provision for federal or state income taxes is provided for the years ending September 30, 2015 and 2014. The Organization files an information return, the IRS Form 990 and follows the provisions of uncertain tax positions as addressed by the Financial Accounting Standards Board. Management is not aware of any uncertain tax positions of the Organization related to the tax filings. The Organization's tax returns for tax years 2012 and later remain subject to examination by taxing authorities. Financial Instruments The following methods and assumptions were used by the Organization in estimating its fair value disclosure for financial instruments. The carrying amounts of cash and cash equivalents, United Way and grants receivables, accounts payable and accrued expenses approximate fair values due to the short-term maturities of these instruments. Subsequent Events In preparing these financial statements, the Organization has evaluated events and transactions for potential recognition or disclosure through February 23, 2016, the date the financial statements were available to be issued. B. GRANTS RECEIVABLE The grants receivable consist of future contributions to fund operations. Management has determined that the grants receivable are fully collectible; therefore, no allowance for uncollectible accounts is considered necessary at September 30, 2015 and 2014. (10)
C. PROPERTY AND EQUIPMENT Sudden Infant Death Syndrome Resources, Inc. NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 (Continued) Property and equipment consists of :furniture and equipment for the years-ended September 30, 2015 and 2014. The furniture and equipment had an original value of $40,555 for the year ended September 30, 2015 with a net book value of$13,192. For the year ended September 30, 2014, furniture and equipment had an original value of$27, 105 and was fully depreciated. Depreciation expense was $258 for the year ended September 30, 2015. There was no depreciation expense for the year-ended September 30, 2014. D. COMMITMENTS The Organization rents office space under operating lease arrangements, which expire at various dates through March 2017. Rent expense totaled $18,020 and $16,458 for the years ended September 30, 2015 and 2014. Future minimum lease payments at September 30, 2015 are as follows: Year Ending September 30, 2016 2017 Total Amount $15,052 6,361 $21.413 E. TEMPORARILY RESTRICTED NET ASSETS The Organization gratefully acknowledges the support of grantors, without whose support, the Organization would not be able to sustain its level of program activities. Temporarily restricted net assets released are as follows at September 30, 2015 and 2014: 2015 2014 United Way $ 21,745 $ 13,899 Missouri Foundation for Health 12,630 Speas Foundation 6,677 3,323 Black Community Fund 9,464 CJ Foundation 3,992 Gannett Foundation 3,525 Royals Charities 76 682 KC Can 11,040 7,051 Total $ 56,160 $ 37,944 (11)
NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 (Continued) E. TEMPORARILY RESTRICTED NET ASSETS (Continued) Temporarily restricted net assets at September 30, 2015 and 2014 from grantors and other sources include the following: United Way $ SPEAS Foundation CJ Foundation Missouri Foundation for Health Royals Charities KC Can 2015 23,360 566 6,468 4,737 1,910 2014 $ 15,150 6,677 2,568 12,949 Total Temporarily Restricted Net Assets $ 37,041 $ 37,344 F. IN-KIND CONTRIBUTIONS In-kind contributions include food and beverages for special events, mileage reimbursement, computer and other miscellaneous items. G. CONCENTRATIONS The United Way of St. Louis and Kansas City provides a substantial portion of the Organization's revenue annually, 34 and 33% in September 30, 2015 and 2014, respectively, and were represented in total receivables at 41 % and 81 % September 30, 2015 and 2014, respectively. A significant reduction in the level of this support, if it were to occur, could have a significant effect on the Organization's programs and activities. However, the Organization has not received any indication from the United Way of any decrease in future support. (12)