VERMONT LONG TERM DISASTER RECOVERY GROUP, INC. (DOING BUSINESS AS VERMONT DISASTER RELIEF FUND )

Transcription

1 VERMONT LONG TERM DISASTER RECOVERY GROUP, INC. (DOING BUSINESS AS VERMONT DISASTER RELIEF FUND ) FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR S REPORT

2 TABLE OF CONTENTS Independent Auditor s Report... 1 Statement of Financial Position... 2 Statement of Activities... 3 Statement of Functional Expenses... 4 Statement of Cash Flows... 5 Notes to Financial Statements

3 131 Main Street, 8 th Floor PO Box 5777 Burlington, VT (802) Toll free in Vermont (800) Fax (802) To the Board of Directors Vermont Long Term Disaster Recovery Group, Inc. Colchester, Vermont Independent Auditor s Report We have audited the accompanying statement of financial position of the Vermont Long Term Disaster Recovery Group, Inc. (a Vermont nonprofit organization) as of December 31, 2012 and the related statements of activities, functional expenses and cash flows for the year 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 U.S. generally accepted accounting principles; 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. 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 U.S. generally accepted auditing standards. 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 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 the Vermont Long Term Disaster Recovery Group, Inc. as of December 31, 2012 and the changes in its net assets and its cash flows for the year then ended in conformity with U.S. generally accepted accounting principles. Burlington, Vermont June 17, 2013 Vermont Registration #333 1

4 STATEMENT OF FINANCIAL POSITION ASSETS Cash and cash equivalents (Notes 1 & 7) $ 3,317,640 Prepaid expenses 16,499 Property and equipment, net of accumulated depreciation (Note 5) 1,264 TOTAL ASSETS $ 3,335,403 LIABILITIES AND NET ASSETS Liabilities: Accounts payable $ 484 Accrued expenses 627 Grants to be paid (refundable advances) (Notes 1 & 6) 3,259,002 Total Liabilities 3,260,113 Net Assets: Unrestricted 3,415 Temporarily restricted (Note 9) 71,875 Permanently restricted - Total Net Assets 75,290 TOTAL LIABILITIES AND NET ASSETS $ 3,335,403 See accompanying notes to financial statements. 2

5 STATEMENT OF ACTIVITIES FOR THE YEAR ENDED SUPPORT AND REVENUE: Temporarily Unrestricted Restricted Total Grants and contributions (Notes 1 & 8) $ - $ 2,569,557 $ 2,569,557 Special event revenue (Note 10) 56,780-56,780 Interest income 2,382-2,382 Net assets released from restrictions: Satisfaction of purpose restrictions 2,497,682 (2,497,682) - TOTAL SUPPORT AND REVENUE 2,556,844 71,875 2,628,719 EXPENSES AND LOSSES: Program services 2,249,830-2,249,830 Cost of direct benefits to special event donors (Note 10) 43,070-43,070 Supporting services: Management and general 4,147-4,147 Fundraising 256, ,382 TOTAL EXPENSES 2,553,429-2,553,429 CHANGE IN NET ASSETS 3,415 71,875 75,290 NET ASSETS, beginning of year NET ASSETS, end of year $ 3,415 $ 71,875 $ 75,290 See accompanying notes to financial statements. 3

6 STATEMENT OF FUNCTIONAL EXPENSES FOR THE YEAR ENDED Supporting Services Program Management Services & General Fundraising TOTAL Flood recovery grants paid $ 2,216,741 $ - $ - $ 2,216,741 Salaries & wages 28,000 2,000 10,000 40,000 Benefits & taxes 2, ,471 Consultants & subcontractors , ,450 Bank, credit card and other fees ,650 2,500 Depreciation Dues & subscriptions Office supplies ,323 Other expenses ,878 7,511 Telephone ,283 Travel $ 2,249,830 $ 4,147 $ 256,382 $ 2,510,359 See accompanying notes to financial statements. 4

7 STATEMENT OF CASH FLOWS FOR THE YEAR ENDED CASH FLOWS FROM OPERATING ACTIVITIES: Change in net assets $ 75,290 Adjustments to reconcile change in net assets to net cash from operating activities: Depreciation 253 (Increase) decrease in operating assets: Prepaid expenses (16,499) Increase (decrease) in operating liabilities: Accounts payable (5,516) Accrued expenses 627 Grants to be paid (refundable advances) 1,177,344 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 1,231,499 CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment (1,517) NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (1,517) CASH FLOWS FROM FINANCING ACTIVITIES: None - NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 1,229,982 CASH AND CASH EQUIVALENTS: Beginning of year 2,087,658 End of year $ 3,317,640 See accompanying notes to financial statements. 5

8 NOTES TO FINANCIAL STATEMENTS NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES History of the Organization and Nature of Activities: Incorporated in Vermont in September 2011, the Vermont Long Term Disaster Recovery Group, Inc. ( VDRF or the Organization and doing business as the Vermont Disaster Relief Fund ) is an independent, nonprofit organization created in the wake of the Spring 2011 flooding and August 2011 s Tropical Storm Irene to coordinate resources and deliver donor dollars to meet the unmet, long-term recovery needs of Vermont individuals and families impacted by these and future disasters. Working with volunteers, local, state and federal officials, and other Vermont nonprofit organizations, VDRF is committed to: coordinating long-term recovery efforts for Vermont families and individuals throughout the state, bringing together the efforts of local and regional disaster recovery groups, working in conjunction with a disaster case management system through local committees to assist survivors of Irene to develop individual recovery plans and allocating resources to assist survivors who need assistance beyond what the Federal Emergency Management Agency ( FEMA ), insurance companies and local recovery funds can provide. Because the Organization has an on-going mission as the funder of last resort for addressing future emergencies, to the extent that not all of the funds raised by VDRF are ultimately allocated to Irene survivors, the remainder will be set aside for addressing the needs arising from the next serious disaster to strike Vermont. From its inception through May 2012, VDRF s financial affairs were managed by United Ways of Vermont, Inc. under a fiscal agency agreement. VDRF s support has come primarily from grants and contributions from individuals, foundations and businesses. Financial Statement Presentation: VDRF reports information regarding its financial position and activities according to three classes of net assets: unrestricted net assets, temporarily restricted net assets, and permanently restricted net assets. Contributions received are recorded as unrestricted, temporarily restricted, or permanently restricted support, depending upon the existence and/or nature of any donor-imposed restrictions. 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 statement of activities as net assets released from restrictions. Temporarily restricted contributions whose restrictions are met in the same period are shown as increases in temporarily restricted net assets with a corresponding transfer to unrestricted net assets. The transfer of assets with donor-imposed conditions is accounted for as a refundable advance, instead of as a contribution, until the conditions have been substantially met. Any funds received not specifically designated for supporting the operations or fundraising efforts of VDRF ( general funds ), are considered 100% designated for direct victim assistance and included in refundable advances until the funds are expended on flood recovery grant payments. 6

9 NOTES TO FINANCIAL STATEMENTS NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Cash and cash equivalents: VDRF has elected to treat all cash accounts, checking, savings, money market, and other cash funds purchased with an original maturity of three months or less as cash and cash equivalents for purposes of the Statement of Cash Flows. Use of estimates: The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Promises to Give: Unconditional promises to give that are expected to be collected within one year are recorded at net realizable value. Those expected to be collected in future years are recorded at the present value of their estimated future cash flows. The discounts on those amounts, if material, are computed using estimated market interest rates applicable to the years in which the promises are received. Any amortization of these discounts would be reflected in contribution revenue. Conditional promises to give are not recorded until the conditions are met. Promises to give general funds (that is, those designated 100% for direct flood recovery grants) are considered conditional and not recorded on the Statement of Financial Position. VDRF had approximately $102,000 in outstanding, conditional promises to give at December 31, NOTE 2 - INCOME TAXES VDRF is exempt from federal income tax (on activities related to its tax-exempt purpose) as an organization described in Section 501(c)(3) of the Internal Revenue Code, and is classified as a publicly supported organization under Section 509(a)(1). Contributions to VDRF qualify for the charitable contribution deduction under Internal Revenue Code Section 170(b)(1)(A). NOTE 3 FUNCTIONAL ALLOCATION OF EXPENSES The costs of providing the various programs have been summarized on a functional basis in the Statement of Activities. Accordingly, certain costs have been allocated among the programs and supporting services benefited. NOTE 4 DONATED SERVICES (IN-KIND CONTRIBUTIONS) No amounts have been reflected in the financial statements for donated services. VDRF generally pays for services requiring specific expertise. However, a number of individuals volunteer their time and perform a variety of tasks that assist the Organization with its program, administrative and fundraising activities. 7

10 VERMONT LONG TERM DISASTER RECOVERY GROUP, INC NOTES TO FINANCIAL STATEMENTS NOTE 5- PROPERTY AND EQUIPMENT At December 31, 2012, property and equipment consisted of $1,517 of office equipment, net of accumulated depreciation of $253. Additions to equipment are recorded at cost when purchased and at market value when donated. Depreciation, amounting to $253 for 2012, is recorded on a straightline basis over estimated useful lives of the assets of three years. NOTE 6 GRANTS TO BE PAID (REFUNDABLE ADVANCES) As discussed above, VDRF considers all contributions received, except for those specifically designated for operational support, as 100% designated for direct flood recovery assistance. Activity in the grants to be paid (refundable advances) account for 2012 is as follows: Refundable advances, beginning of the year $ 2,081,658 Grants and contributions received 3,396,585 Direct fees related to the receipt of contributions (2,500) Flood recovery grant funds disbursed (2,216,741) Refundable advances, end of the year $ 3,259,002 NOTE 7 CONCENTRATION OF CASH ON DEPOSIT The Organization has concentrated its credit risk by maintaining deposits in financial institutions that exceed amounts covered by insurance provided by the U.S. Federal Deposit Insurance Corporation (FDIC). VDRF has not experienced any losses in such accounts and believes it is not exposed to any unreasonable credit risk to cash. NOTE 8 CONCENTRATION OF REVENUE VDRF received $1,800,000 from two major donors an amount representing approximately 47% of its total receipts for the year. NOTE 9 RESTRICTED NET ASSETS Temporarily restricted net assets at December 31, 2012 consisted of $43,763 restricted for support of VDRF s operating costs (salary, telephone, etc.) and $28,112 restricted to fundraising activities. NOTE 10 SPECIAL EVENT VDRF recognized $56,780 as the non-contribution portion of revenue from an August 2012 golf tournament. The net proceeds from the event of $72,189 (total revenue of $161,034 less the cost of direct donor benefits of $43,070 less other direct expenses of $45,775) were recognized as general fund donations and included in refundable advance activity discussed above. NOTE 11 - SUBSEQUENT EVENTS AND REPORT ISSUANCE DATE Management has evaluated events subsequent to December 31, 2012 through June 17, 2013 (the date these financial statements were available to be issued) for potential recognition or disclosure as required under U.S. generally accepted accounting principles. 8