K-W YMCA Endowment Foundation. Financial Statements December 31, 2014

Transcription

1 K-W YMCA Endowment Foundation Financial Statements December 31,

2 April 14, 2015 Independent Auditor s Report To the Members of K-W YMCA Endowment Foundation We have audited the accompanying financial statements of K-W YMCA Endowment Foundation, which comprise the statement of financial position as at December 31, and the statements of operations and balances and cash flows for the year then ended, and the related notes, which comprise a summary of significant accounting policies and other explanatory information. Management s responsibility for the financial statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian accounting standards for not-for-profit organizations, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and 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. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of 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 qualified audit opinion. PricewaterhouseCoopers LLP 95 King Street South, Suite 201, Waterloo, Ontario, Canada N2J 5A2 T: , F: PwC refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.

3 Basis for qualified opinion In common with many not-for-profit organizations, K-W YMCA Endowment Foundation derives revenues from donations, the completeness of which is not susceptible to satisfactory audit verification. Accordingly, verification of these revenues was limited to the amounts recorded in the records of K-W YMCA Endowment Foundation. Therefore, we were not able to determine whether any adjustments might be necessary to donations, excess (deficiency) of revenue over expenditures and cash flows from operations for the year ended December 31, and December 31,, current assets as at December 31, and December 31, and balance - restricted as at January 1 and December 31 for both the and years. Our audit opinion on the financial statements for the year ended December 31, was modified accordingly because of the possible effects of this limitation in scope. Qualified opinion In our opinion, except for the possible effects of the matter described in the basis for qualified opinion paragraph, the financial statements present fairly, in all material respects, the financial position of K-W YMCA Endowment Foundation as at December 31, and the results of its operations and its cash flows for the year then ended in accordance with Canadian accounting standards for not-for-profit organizations. Chartered Professional Accountants, Licensed Public Accountants

4 Statement of Financial Position As at December 31, Assets Current assets Cash 202, ,805 Accounts receivable - 1,050 Interest receivable 1,182 1,271 Investments (note 4) 1,844,947 1,673,210 Liabilities and Fund Balances 2,048,963 1,776,336 Current liabilities Accounts payable and accrued liabilities 1,494 - Payable to The Kitchener-Waterloo Young Men s Christian Association 124,435 32,533 Deferred revenue (note 5) 35,447 27, ,376 59,647 Fund balance - restricted 1,887,587 1,716,689 2,048,963 1,776,336 Approved by the Board of Directors Director Director The accompanying notes are an integral part of these financial statements.

5 Statement of Operations and Fund Balances For the year ended December 31, Operating General International Member OMG Camp CES WGB Camp R Pownall Revenue Donations 5,137-3,726-2,250 53, ,018 75, ,930 Gain on investments 129, , ,274 Investment income 55, ,856 49, ,960-3,726-2,250 53, , , ,180 Expenses Investment counsel fees 14, ,351 12,738 Audit fees 3, ,000 3,000 Administrative 1, ,665 1,534 Fundraising costs 3, ,546 1,582 Insurance premiums 4, ,431 6,254 Allocated expenses (note 6) (8,211) 5, , ,782 5, , ,993 25,108 Excess (deficiency) of revenue over expenditures before grants 172,178 (5,051) 3,676 (304) 1,933 51,393 (187) (618) 10, , ,072 Grant to The Kitchener-Waterloo Young Men s Christian Association - - (993) (6,075) (6,339) (33,104) (3,739) (12,348) (516) (63,114) (61,466) Excess (deficiency) of revenue over expenditures 172,178 (5,051) 2,683 (6,379) (4,406) 18,289 (3,926) (12,966) 10, , ,606 Fund balances - Beginning of year - 1,077,435 8,748 64,903 66, ,136 39, ,920-1,716,689 1,431,083 Fund transfer (172,178) 105,904 1,043 6,379 6,656 34,762 3,926 12, Fund balances - End of year - 1,178,288 12,474 64,903 68, ,187 39, ,920 11,018 1,887,587 1,716,689 The accompanying notes are an integral part of these financial statements.

6 Statement of Cash Flows For the year ended December 31, Cash provided by (used in) Operating activities Excess of revenue over expenditures 170, ,606 Item not involving cash Unrealized gain on investments (134,837) (138,180) Change in non-cash operating working capital Accounts receivable 1,050 3,302 Interest receivable 89 (190) Accounts payable and accrued liabilities 1,494 - Payable to The Kitchener-Waterloo Young Men s Christian Association 91,902 (16,435) Deferred revenue 8,333 2, , ,321 Investing activities Sales of investments 414, ,617 Purchases of investments (451,634) (645,756) (36,900) (128,139) Increase in cash 102,029 8,182 Cash - Beginning of year 100,805 92,623 Cash - End of year 202, ,805 The accompanying notes are an integral part of these financial statements.

7 Notes to Financial Statements December 31, 1 Purpose of the Foundation The K-W YMCA Endowment Foundation ( the Foundation ) has been incorporated under the laws of Ontario with broad charitable objectives and with the primary purpose being the raising of s to be used for the special needs or to reduce the deficit of The Kitchener-Waterloo Young Men s Christian Association in furtherance of its aims and objectives. 2 Significant accounting policies Basis of accounting The Foundation prepares its financial statements in accordance with Canadian accounting standards for notfor-profit organizations (ASNPO). Fund accounting The Foundation follows the restricted method of accounting for contributions. Operating - reflects the activities related to unrestricted investment income and operating expenses of the Foundation. Any excess of revenue over expenditures, or expenditures over revenue is allocated to the restricted s proportionately to the size of the. General - reflects the activities related to donations received and payments made for the betterment and potential future expansion of K-W YMCA facilities. International sponsorships - reflects the activities related to donations received for enabling youth who cannot afford to pay the full price fee to participate in the International Understanding Program. Membership support - reflects the activities related to donations received for supporting membership and program fees for those individuals and families who have the greatest need in the community. OMG - reflects the activities related to donations received for providing financial assistance to campers and/or leaders-in-training at Camp Wabanaki. Camp - reflects the activities related to donations received for the development and operation of youth programs directed to encouraging the development of the participant s self-sufficiency and self-esteem within the outdoor and camping environment. Camp environment sustainability (CES) - reflects the activities related to donations received for the betterment of the programs and camp facilities with emphasis on alternative energies, technologies and sustainable practices. WGB camp - reflects the activities related to donations received for the betterment of the programs and camp facilities with emphasis on alternative energies, technologies and sustainable practices. (1)

8 Notes to Financial Statements December 31, Roger Pownall educational award - reflects the activities related to donations received to be awarded to post-secondary education initiatives for eligible YMCA staff. Revenue recognition Restricted contributions are recognized as revenue of the appropriate as received. Unrestricted contributions are recognized as revenue of the operating in the year received or receivable if the amount to be received can be reasonably estimated and collection is reasonably assured. Any excess of revenue over expenditures or expenditures over revenue is allocated to the restricted s proportionately to the size of the. Investments Investments are recorded at fair market value on the statement of financial position. The corresponding gain or loss on revaluation is recorded on the statement of operations and balances. Investment income is recorded on an accrual basis. Contributed goods and services The value of contributed services to the Foundation is not reflected in these financial statements due to the difficulty of determining the fair value. The value of goods contributed to the Foundation is reflected in these financial statements at the values attributed for income tax purposes. Life insurance policies Where they are owned by the Foundation, life insurance policies are treated as assets of the Foundation. Where there is a cash surrender value they are recorded as deferred revenue until such time as the policy benefits are received. Revenues and expenditures during the year reflect donations received and premiums paid. Pledges Pledges to donate s to the Foundation are not recorded in the accounts until such time as s are received. Use of estimates The preparation of financial statements in accordance with Canadian accounting standards for not-for-profit organizations requires management to make estimates and assumptions that affect the reported amounts of 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 management s best estimates as additional information becomes available in the future. (2)

9 Notes to Financial Statements December 31, Financial instruments The Foundation s financial instruments consist of cash, accounts receivable, investments, accounts payable and payable to The Kitchener-Waterloo Young Men s Christian Association. The Foundation records its financial instruments initially at fair value and subsequently they are recorded at amortized cost, with the exception of investments. Investments are carried on the statement of financial position at fair value of 1,844,947 ( - 1,673,210) with changes in fair values being recognized in the statement of operations. The aggregate amount of financial instruments recorded at amortized cost is an asset of 76,905 ( - 69,322). Financial assets are tested for impairment at the end of each reporting period where there are indications that the assets may be impaired. Any excess of the carrying amount of the financial assets over the recoverable amount is recorded as an impairment charge. A previously recognized impairment charge may be reversed in future periods. Unless otherwise noted, it is management s opinion that the Foundation is not exposed to significant interest, currency or credit risks arising from its financial instruments. 3 Payable to The Kitchener-Waterloo Young Men s Christian Association In, the Foundation approved a grant payable of 63,114 ( - 61,466) to The Kitchener-Waterloo Young Men s Christian Association. 4 Investments All securities of the Foundation are held in trust by TD Private Client Group, of which some are held as unitized s. Cash and cash equivalents - 65,715 Canadian bonds 754, ,387 Canadian equities 453, ,637 U.S. equities 376, ,564 International equities 224, ,793 Cash surrender value of life insurance policies 35,447 27,114 1,844,947 1,673,210 (3)

10 Notes to Financial Statements December 31, 5 Life insurance policies The Foundation has been given life insurance policies with a total face value of approximately 460,000 ( - 460,000) under which it is the owner and beneficiary and annual donations are received to cover the premiums. There is a cash surrender value of 35,447 at December 31, ( - 27,114). As the realizable amount under the policies is not certain, the Foundation will record the benefits when the proceeds are received. 6 Allocated expenses The Foundation allocates certain costs by identifying the appropriate basis of allocating and applying that basis consistently each year. Allocated expenses are based on the average balance and are allocated as follows: % % General International 1 1 OMG 4 4 Member 4 4 Camp CES 2 6 WGB R Pownall - - The expenses allocated are as follows: Audit fee 3,000 3,000 Administrative 1,665 1,534 Fundraising costs 3,546 1,582 8,211 6,116 (4)

11