Children’s Cancer Association GaryMcGee & Co.

GaryMcGee & Co. LLP
CERTIFIED PUBLIC ACCOUNTANTS
Children’s Cancer Association
Consolidated Financial Statements and Other
Information as of and for the Year Ended April 30, 2013
and Report of Independent Accountants
CHILDREN’S CANCER ASSOCIATION
TABLE OF CONTENTS
Page
Report of Independent Accountants
3
Financial Statements:
Consolidated Statement of Financial Position
5
Consolidated Statement of Activities
6
Consolidated Statement of Cash Flows
7
Consolidated Statement of Functional Expenses
8
Notes to Consolidated Financial Statements
10
Supplementary Financial Information:
Schedule 1 – Consolidating Schedule of Financial Position
19
Schedule 2 – Consolidating Schedule of Activities
20
Other Information:
Governing Board, Management, and Staff
21
Inquiries and Other Information
23
GaryMcGee & Co. LLP
CERTIFIED PUBLIC ACCOUNTANTS
REPORT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Children’s Cancer Association:
We have audited the accompanying consolidated financial statements of the Children’s Cancer Association,
which comprise the consolidated statement of financial position as of April 30, 2013, and the related consolidated
statements of activities, cash flows, and functional expenses for the year then ended, and the related notes to the
consolidated financial statements.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in
accordance with accounting principles generally accepted in the United States; 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.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United States. 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 organization’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 organization’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 consolidated financial statements referred to above present fairly, in all material respects, the
consolidated financial position of the Children’s Cancer Association as of April 30, 2013, and the changes in its
net assets and its cash flows for the year then ended in accordance with accounting principles generally accepted
in the United States.
808 SW Third Avenue, Suite 700 Portland, Oregon 97204 p: 503 222 2515 f: 503 222 6401 www.garymcgee.com
3
Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the consolidated financial statements as a
whole. The consolidating schedule of financial position and the consolidating schedule of activities on pages 19
and 20 are presented for purposes of additional analysis and are not a required part of the consolidated 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 consolidated financial statements. The information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements
and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidated
financial statements themselves, and other additional procedures in accordance with auditing standards generally
accepted in the United States. In our opinion, the information is fairly stated in all material respects in relation to
the consolidated financial statements as a whole.
Summarized Comparative Information
We have previously audited the Children’s Cancer Association’s 2012 consolidated financial statements, and we
expressed an unmodified audit opinion on those audited consolidated financial statements in our report dated
July 19, 2012. In our opinion, the summarized comparative information presented herein as of and for the year
ended April 30, 2012 is consistent, in all material respects, with the audited consolidated financial statements
from which it has been derived.
July 25, 2013
4
CHILDREN’S CANCER ASSOCIATION
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
APRIL 30, 2013
(WITH COMPARATIVE AMOUNTS FOR 2012)
2013
2012
$ 1,011,201
508,815
89,343
187,504
1,417,581
969,055
206,707
46,327
187,504
1,475,704
$ 3,214,444
2,885,297
65,977
173,222
75,000
56,600
45,485
183,174
39,670
75,000
56,600
370,799
399,929
Unrestricted:
Available for general operations and programs
Designated by Board (note 7)
Net investment in capital assets
333,809
500,000
1,360,981
248,983
500,000
1,379,434
Total unrestricted
2,194,790
2,128,417
278,307
370,548
236,951
120,000
2,843,645
2,485,368
$ 3,214,444
2,885,297
Assets:
Cash and cash equivalents
Contributions receivable (note 4)
Prepaid expenses and other assets
Property held for sale (note 5)
Property and equipment (notes 5 and 6)
Total assets
Liabilities:
Accounts payable and accrued expenses
Accrued payroll liabilities
Grant payable
Assets held for others (note 5)
Note payable (note 6)
Total liabilities
–
Net assets:
Temporarily restricted (note 7)
Permanently restricted (note 7)
Total net assets
Commitments (notes 11 and 12)
Total liabilities and net assets
See accompanying notes to consolidated financial statements.
5
CHILDREN’S CANCER ASSOCIATION
CONSOLIDATED STATEMENT OF ACTIVITIES
YEAR ENDED APRIL 30, 2013
(WITH COMPARATIVE TOTALS FOR 2012)
Unrestricted
2013
Temporarily
Permanently
restricted
restricted
Total
2012
–
–
3,312,479
30,524
2,890,237
27,748
3,343,003
2,917,985
Operating revenues, gains,
and other support:
Contributions and grants (note 8)
Investment income and other
$
Total operating revenues and gains
2,994,172
30,524
3,024,696
Net assets released from restrictions (note 9)
276,951
Total operating revenues, gains,
and other support
3,301,647
318,307
–
318,307
–
(276,951)
–
41,356
–
3,343,003
2,917,985
–
–
(note 10):
Program services:
Music Rx
Education and resources
Link Family Enrichment program
Pediatric Chemo Pal Mentor program
Caring Cabin
Volunteer program
1,159,319
330,221
350,107
384,164
186,400
191,529
–
–
–
–
–
–
–
–
–
–
–
–
1,159,319
330,221
350,107
384,164
186,400
191,529
915,122
282,068
309,176
439,321
165,510
125,026
Total program services
2,601,740
–
–
2,601,740
2,236,223
Supporting services:
Management and general
Fundraising
193,722
439,812
–
–
–
–
193,722
439,812
198,731
382,043
Total supporting services
633,534
–
–
633,534
580,774
3,235,274
–
–
3,235,274
2,816,997
–
107,729
100,988
Expenses
Total expenses
Increase in net assets before
non-operating activities
66,373 [A]
41,356
Non-operating activities:
Endowment gifts
Total non-operating activities
Increase in net assets
Net assets at beginning of year
Net assets at end of year
$
–
–
250,548
250,548
120,000
–
–
250,548
250,548
120,000
66,373
41,356
250,548
358,277
220,988
2,128,417
236,951
120,000
2,485,368
2,264,380
2,194,790
278,307
370,548
2,843,645
2,485,368
See accompanying notes to consolidated financial statements.
[A]
The Association’s net operating measure includes $182,007 in depreciation expense.
6
CHILDREN’S CANCER ASSOCIATION
CONSOLIDATED STATEMENT OF CASH FLOWS
YEAR ENDED APRIL 30, 2013
(WITH COMPARATIVE TOTALS FOR 2012)
2013
Cash flows from operating activities:
Cash received from contributors, grantors, and others
Interest income
Cash paid to employees and suppliers
Interest expense
$ 2,784,816
1,687
(2,580,778)
(573)
Net cash provided by operating activities
Cash flows from investing activities:
Capital expenditures
Net cash used in investing activities
2012
2,581,542
1,640
(2,286,756)
(565)
205,152
295,861
(163,554)
(105,201)
(163,554)
(105,201)
Cash flows from financing activities
Proceeds from contributions
restricted for long-term investment
548
120,000
Net cash provided by financing activities
548
120,000
Net increase in cash and cash equivalents
42,146
310,660
969,055
658,395
$ 1,011,201
969,055
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Supplemental schedule of noncash investing and financing activities:
In-kind grant of equipment in satisfaction of grant payable
$
39,670
–
See accompanying notes to consolidated financial statements.
7
CHILDREN'S CANCER ASSOCIATION
CONSOLIDATED STATEMENT OF FUNCTIONAL EXPENSES
YEAR ENDED APRIL 30, 2013
(WITH COMPARATIVE TOTALS FOR 2012)
Music Rx
Salaries and related expenses
Professional services
Occupancy
Telephone
Supplies
Postage
Printing and publications
Equipment
Insurance
Travel
Meetings and public relations
Bank and merchandising fees
Provision for noncollection
of pledges receivable
Other
Total expenses before depreciation
$
Caring
Cabin
Volunteer
program
219,523
66,948
12,811
1,744
5,107
3,144
9,961
1,388
1,441
3,668
10
−
148,015
36,929
8,839
1,202
144,693
891
2,039
956
993
2,192
44
−
218,465
42,719
13,081
1,991
89,758
1,255
3,037
1,425
1,479
4,913
816
−
88,899
17,576
22,542
2,726
13,043
1,487
1,227
576
598
3,966
141
−
136,161
25,420
7,990
1,242
9,861
705
1,883
868
902
1,934
1,108
−
−
2,925
−
260
−
408
−
896
−
2,421
−
816
1,028,322
326,005
347,201
379,835
155,202
188,890
130,997
4,216
2,906
4,329
31,198
2,639
$ 1,159,319
330,221
350,107
384,164
186,400
191,529
See accompanying notes to consolidated financial statements.
8
2013
577,691
294,085
34,495
6,535
58,583
6,852
19,372
3,734
3,878
19,853
319
−
Depreciation
Total expenses
Program services
Link
Pediatric
Education
Family Chemo Pal
and Enrichment
Mentor
resources
program
program
Supporting services
Management
FundTotal and general
raising
Total
Total
2012
1,388,754
483,677
99,758
15,440
321,045
14,334
37,519
8,947
9,291
36,526
2,438
−
81,947
33,390
6,081
834
1,128
537
1,415
664
31,273
1,177
3,513
99
189,835
84,748
11,172
2,250
18,646
7,833
50,125
1,220
1,266
6,484
1,987
29,735
271,782
118,138
17,253
3,084
19,774
8,370
51,540
1,884
32,539
7,661
5,500
29,834
1,660,536
601,815
117,011
18,524
340,819
22,704
89,059
10,831
41,830
44,187
7,938
29,834
1,478,138
438,275
79,854
16,409
326,985
28,447
53,904
12,148
44,886
44,222
9,441
28,705
−
7,726
15,472
14,176
−
30,805
15,472
44,981
15,472
52,707
12,947
69,837
2,425,455
191,706
436,106
627,812
3,053,267
2,644,198
176,285
2,016
3,706
5,722
182,007
172,799
2,601,740
193,722
439,812
633,534
3,235,274
2,816,997
9
CHILDREN’S CANCER ASSOCIATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED APRIL 30, 2013
1. Organization
The Children’s Cancer Association (“CCA” or the
“Association”) is an Oregon nonprofit corporation established in 1995. The Association brings
innovative, award-winning programs that provide
joy to children with life-threatening illnesses and
their families at no cost, offering them unique inhospital programs, family and emotional support,
access to information, use of a family retreat
home, and education and resources to improve
their care and quality of life.
2. Program Services
During the year ended April 30, 2013, the Association incurred program service expenses in the following major categories:
®
– The Association’s MusicRx Specialists and volunteers bring the healing power of
music medicine to hundreds of children and family members in local hospitals and clinics each
week. The 18-year-old program incorporates
state-of-the-art mobile music carts loaded with
specialized instruments for all ages and abilities.
Launched in March of 2011, MyMusicRx.org is
an innovative digital expansion of the Association’s in-hospital MusicRx program, allowing seriously-ill kids and teens to escape the isolation
and loneliness of treatment by providing access to
music medicine online 24/7.
MusicRx
– Operated in partnership with Randall Children's Hospital at Legacy Emanuel in Portland, Oregon, the Alexandra
Ellis Family Resource Center provides free, 24/7
access for families and patients, specialized health
information, books to loan, and resource directories. Through the Center’s computer bank, families stay connected to friends, work and the outside world during their child’s hospital stay. The
Association also publishes a national Kids’ Cancer Pages and local Family Resource Pages.
Education and Resources
10
Link – The Link program is a community network of caring people and organizations uniting
local families with essential needs and connections to local and national resources. This program helps families with specific essential needs,
offers funeral assistance and bereavement support, and responds with “yes” when a child with a
terminal illness has a special wish not met by other organizations.
®
Mentor Program – The Chemo Pal
Mentor Program gives kids and teens a trusted
adult friend to look forward to during treatments
and someone in their corner when they need it
most. Chemo Pals visit children in the hospital,
clinic, or at home, where together they play
games, take walks, read, do art projects, and
share hobbies.
Chemo Pal
The Alexandra Ellis Caring Cabin ™ – The Alexandra Ellis Caring Cabin provides children facing cancer and terminal illnesses and their families
with an extraordinary place to retreat, relax, and
create once-in-a-lifetime memories. Located on
24 private acres along the Oregon coast, this spectacular setting features a beautiful sand beach,
campfire, and serene lake for kayaking.
Volunteer program − Volunteers fuel programs
that deliver the joy of music, the magic of wishes,
the power of information, and the comfort of
friendship to thousands of seriously ill children,
teens, and their families every year. Volunteers
help the Association through generous commitments of time, energy and expertise, providing assistance through a variety of services including
program delivery, clerical and office support, and
other specialized skills. The Association invests
resources and staff to engage the community and
recruit, educate, and train volunteers to help meet
the needs of local children and teens with serious
illnesses.
3. Summary of Significant Accounting
Policies
The significant accounting policies followed by
the Association are described below to enhance
the usefulness of the financial statements to the
reader.
– The accompanying financial statements have been prepared on the accrual
basis of accounting in accordance with generally
accepted accounting principles and the principles
of fund accounting. Fund accounting is the procedure by which resources for various purposes
are classified for accounting purposes in accordance with activities or objectives specified by
donors.
Basis of Accounting
Principles of Consolidation − The accompanying
financial statements include the accounts of Children’s Cancer Association and The Foundation of
the Children’s Cancer Association. All significant
interorganizational investments, accounts, and
transactions have been eliminated.
The Foundation of the Children’s Cancer Association (the “Foundation”) was incorporated in
September of 2011 to provide support to the Association, including making payments to or for
the use of, or providing services and facilities for
the members of the charitable class benefited by,
the Association. The Foundation is a nonprofit
corporation organized in accordance with the
laws of the State of Oregon.
Basis of Presentation – The Association has
adopted the provisions of Financial Accounting
Standards Board (“FASB”) Accounting Standards
Codification (“ASC”) No. 958-605, Revenue Recognition and FASB ASC No. 958-205, Presentation of Financial Statements. Under these provisions, net assets and all balances and transactions
are presented based on the existence or absence of
donor-imposed restrictions. Accordingly, the net
assets of the Association and changes therein are
classified and reported as follows:
• Unrestricted net assets – Net assets not subject
to donor-imposed stipulations.
• Temporarily restricted net assets – Net assets
subject to donor-imposed stipulations that may
be met by actions of the Association and/or the
passage of time. These balances represent the
unexpended portion of externally restricted
contributions and investment return to be used
for specific programs and activities as directed
by the donor.
• Permanently restricted net assets – Net assets
subject to donor-imposed stipulations that they
be maintained permanently by the Association.
Generally, the donors of these assets permit the
organization to use all or part of the income
earned on related investments for general or
specific purposes.
Expenses are reported as decreases in unrestricted
net assets. Gains and losses on investments and
other assets or liabilities are reported as increases
or decreases in unrestricted net assets unless their
use is restricted by explicit donor stipulation or by
law. Expirations of temporary restrictions on net
assets (i.e., the donor-stipulated purpose has been
fulfilled and/or the stipulated time period has
elapsed) are reported as net assets released from
restrictions. The receipt of contributions with restrictions that are satisfied in the same reporting
period as received are reported as unrestricted
support.
– The preparation of financial
statements in conformity with generally accepted
accounting principles requires that management
make estimates and assumptions that affect the
reported amounts of assets and liabilities, the 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. In the opinion of management,
such differences, if any, would not be significant.
Use of Estimates
– Contributions, which include unconditional promises to give (pledges), are recognized as revenues in the period received. Conditional promises to give are not recognized until
they become unconditional, that is when the conditions on which they depend are substantially
met. Contributions of assets other than cash are
recorded at their estimated fair value.
Contributions
11
Contributions of Long-Lived Assets – Contributions of property and equipment without donor
stipulations concerning the use of such long-lived
assets are reported as revenues of the unrestricted
net asset class. Contributions of cash or other assets to be used to acquire property and equipment
with such donor stipulations are reported as revenues of the temporarily restricted net asset class;
the restrictions are considered to be released at
the time of acquisition of such long-lived assets.
Benefits Provided to Donors at Special Events −
The Association conducts special fundraising
events from which a portion of the gross proceeds
paid by participants represents payment for the
direct cost of the benefits received by participants
at the event. Unless a verifiable, objective means
exists to demonstrate otherwise, the fair value of
meals and entertainment provided at special
events is measured at the actual cost to the Association.
Cash Equivalents –
For purposes of the financial
statements, the Association generally considers
liquid investments having initial maturities of
three months or less to be the equivalent of cash.
– The Association includes in its measure of operations all revenues
and expenses that are integral to its programs and
supporting activities, including net assets released
from donor restrictions to support operations.
The measure of operations excludes capital contributions, contributions for long-term investment, and impairment losses on property held for
sale.
Measure of Operations
Capital Assets and Depreciation – Property and
equipment are carried at cost, and at market value
when acquired by gift. Depreciation is provided
on a straight-line basis over the estimated useful
lives of the respective assets, which is generally 3
to 40 years.
Property Held for Sale – Property held for sale is
carried at the lower of cost or fair value less the
estimated costs to sell the property.
12
Revenue Recognition – All contributions and
grants are considered available for the unrestricted general operations of the Association
unless specifically restricted by a donor. Service
revenues are recognized at the time services are
provided and the revenues are earned. Bequests
are recorded as revenue at the time the Association has an established right to the bequest and
the proceeds are measurable.
Endowment Funds and Interpretation of
Relevant Law – Effective January 1, 2008, the
State of Oregon adopted the Uniform Prudent
Management of Institutional Funds Act (“UPMIFA”) which governs Oregon charitable institutions with respect to the management, investment,
and expenditure of donor-restricted endowment
funds.
The Board of Directors has interpreted Oregon’s
adoption of UPMIFA as requiring the Association
to adopt investment and spending policies that
preserve the fair value of the original gift as of the
date of gift, absent explicit donor stipulations to
the contrary. Although the Association has a
long-term fiduciary duty to the donor (and to others) for a fund of perpetual duration, the preservation of the endowment’s purchasing power is
only one of several factors that are considered in
managing and investing these funds. Furthermore, in accordance with UPMIFA, a portion of
the endowment’s original gift may be appropriated for expenditure in support of the restricted
purposes of the endowment if this is consistent
with a spending policy that otherwise satisfies the
requisite standard of prudence under UPMIFA.
As a result of this interpretation, the Association
classifies as permanently restricted net assets (1)
the original value of gifts donated to the permanent endowment, (2) subsequent gifts to the endowment, and (3) accumulations made pursuant
to the direction of the applicable donor gift instrument at the time the accumulation is added to
the fund.
Net earnings (realized and unrealized) on the investment of endowment assets are classified as
temporarily restricted until those amounts are appropriated for expenditure by the Association in a
manner consistent with the standard of prudence
prescribed by UPMIFA and until expended in a
manner consistent with the purpose or time restrictions, if any, imposed by the donor. Any investment return classified as permanently restricted represents only those amounts required to
be retained permanently as a result of explicit donor stipulations.
With regard to endowment losses or appropriations in excess of the fair value of the original gift,
in accordance with FASB ASC No. 958-320, Investments – Debt and Equity Securities, the portion of a donor-restricted endowment that is classified as permanently restricted is not reduced by
losses on the investments of the fund, except to
the extent required by the donor, including losses
related to specific investments that the donor requires the Association to hold in perpetuity. Similarly, the amount of permanently restricted net assets is not reduced by the Association’s appropriations from the fund. In the absence of donor stipulations or law to the contrary, losses or appropriations of a donor-restricted endowment reduce
temporarily restricted net assets to the extent that
donor-imposed temporary restrictions on net appreciation of the fund have not been satisfied before the loss or appropriation occurs. Any remaining loss or appropriation reduces unrestricted net assets.
In accordance with UPMIFA, the Board of Directors has adopted investment and spending policies
for endowment assets that attempt to provide a
predictable stream of funding to the programs
and operations supported by its endowment,
while also seeking to maintain the long-term purchasing power of the endowment assets. Therefore, the Board of Directors considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment
funds:
•
•
•
•
•
The duration and preservation of the fund;
The purposes of the Association and the fund;
General economic conditions;
The possible effect of inflation and deflation;
The expected total return from income and the
appreciation of investments;
• Other resources of the Association; and
• The investment policies of the Association.
Advertising Expenses –
Advertising costs are
charged to expense as they are incurred.
Income Taxes – Both the Association and the
Foundation of the Children’s Cancer Association
are exempt from federal and state income taxes
under Section 501(c)(3) of the Internal Revenue
Code and comparable state law. The Children’s
Cancer Association has been recognized as a public charity under Sections 170(b)(1)(A)(vi) and
509(a)(1) of the Internal Revenue Code. The
Foundation of the Children’s Cancer Association
derives its public charity status as a Type I supporting organization described in IRC Section
509(a)(3). For tax purposes, the Association’s
open audit periods are for the years ended April
31, 2010 through 2012.
The Association has adopted the recognition requirements for uncertain income tax positions as
required by FASB ASC No. 740-10, Income Taxes. Under this standard, income tax benefits are
recognized for income tax positions taken or expected to be taken in a tax return only when it is
determined that the income tax position will
more-likely-than-not be sustained upon examination by taxing authorities.
– As required by FASB ASC
No. 855-10, Subsequent Events, subsequent events
have been evaluated by management through July
25, 2013, which is the date the financial statements were available to be issued.
Subsequent Events
Concentrations of Credit Risk − The Association’s financial instruments consist primarily of
cash equivalents, which may subject the organization to concentrations of credit risk as, from time
to time, for example, cash balances may exceed
amounts insured by the Federal Deposit Insurance
Corporation (“FDIC”). In addition, the market
value of securities is dependent on the ability of
the issuer to honor its contractual commitments,
and the investments are subject to changes in
market values.
During the year ended April 30, 2013, the Board
of Directors did not appropriate any funds for expenditure (see note 7).
13
All interest-bearing checking and savings accounts, money market deposit accounts, and certificates of deposit are insured by the FDIC for up
to $250,000 per depositor, per insured bank, for
each account ownership category. Prior to January 1, 2013, Section 343 of the Dodd-Frank Wall
Street Reform and Consumer Protection Act provided depositors with unlimited coverage for noninterest-bearing transaction accounts. This unlimited protection for noninterest-bearing transaction accounts expired on December 31, 2012,
and, beginning January 1, 2013, all accounts at an
insured depository institution, including noninterest-bearing transaction accounts, are insured
by the FDIC up to $250,000 per depositor, per insured bank, for each deposit insurance ownership
category. At April 30, 2013, the Association had
$650,605 in cash in excess of these limits.
Certain receivables may also, from time to time,
subject the Association to concentrations of credit
risk. To minimize its exposure to significant losses from customer or donor insolvencies, the organization’s management evaluates the financial
condition of its customers and donors, and monitors concentrations of credit risk arising from
similar geographic regions, activities, or economic
characteristics. When necessary, receivables are
reported net of an allowance for uncollectible accounts.
Summarized Financial Information for 2012 –
The accompanying financial information as of
and for the year ended April 30, 2012 is presented
for comparative purposes only and is not intended
to represent a complete financial statement presentation.
Other Significant Accounting Policies – Other
significant accounting policies are set forth in the
financial statements and the following notes.
4. Contributions Receivable
Contributions receivable are summarized as follows at April 30, 2013:
Unconditional promises
expected to be collected in:
Less than one year
One year to five years
$
488,815
40,000
528,815
Less allowance for
doubtful collection
(20,000)
$
508,815
Included in the pledges receivable at April 30,
2013 are $250,000 in pledges restricted for endowment.
5. Property and Equipment
A summary of property and equipment at April
30, 2013 is as follows:
Land
Caring Cabin
Caring Cabin furnishings
Furniture and equipment
Leasehold improvements
Web sites
Trademark
$
150,000
964,369
48,402
490,386
111,220
312,102
2,201
2,078,680
Less accumulated depreciation
(661,099)
$ 1,417,581
During the year ended April 30, 2011, the Association received a gift of real property located in Pacific City, Oregon, initially valued at $300,000.
The Association is required to sell the property,
retaining 60% of the net proceeds resulting from
the sale, and transferring 40% of the net proceeds
to an independent nonprofit organization unrelated to the Association.
14
Original value of the gift
$
300,000
Less subsequent decline in value
(75,000)
Less estimated selling costs
(37,496)
Projected distribution of
estimated net proceeds:
The Association
Other nonprofit
organization
$
187,504
$
112,504
The following table summarizes the maturities of
note principal for the five years subsequent to
April 30, 2013 and thereafter:
Years ending April 30,
2014
2015
2016
2017
2018
Thereafter
75,000
$
$
1,361
4,111
4,153
4,194
4,236
38,545
$
56,600
187,504
The portion of the estimated net proceeds that
will ultimately be transferred to the other nonprofit organization have not been recognized as
revenues or expenses of the Association pursuant
to FASB ASC No. 958-605, Revenue Recognition.
Instead, they are reflected in the accompanying
statement of financial position as a liability totaling $75,000.
6. Note Payable
During the year ended April 30, 2007, the Association issued a promissory note in the amount of
$56,600 to the Portland Development Commission in return for a loan under its “Quality Jobs
Program”. Payment of the note is secured by certain property and equipment. The loan is for a
term of 20 years with no interest accrued through
December 1, 2008. Beginning January 1, 2009, interest-only payments became due monthly
through December 1, 2013, with interest calculated at 1.0% if the Association is fully compliant
with certain job creation benefits. Principal and
interest payments will be due monthly beginning
on January 1, 2014, and will be payable until the
note is retired.
7. Restrictions and Limitations on Net Asset
Balances
The following summarizes the donor-imposed
and Board-designated limitations on net assets as
of April 30, 2013:
Board-Designated Net Assets
At April 30, 2013, $500,000 of the Association’s
unrestricted net assets has been designated by the
Board of Directors for the following purposes:
Caring Cabin
Future growth/2020 fund
$
350,000
150,000
$
500,000
Temporarily Restricted Net Assets
Temporarily restricted net assets consist of the
following at April 30, 2013:
Contributions and grants for
general purposes in
future periods
MyMusicRx
MusicRx Randall Hospital
expansion
Link Family Enrichment
Other programs
$
158,815
80,000
27,000
11,426
1,066
$
278,307
Continued
15
Permanently Restricted Net Assets
8. Contributions and Grants
At April 30, 2013, the Association held $370,548
in donor-restricted endowment funds. These
funds represent the portion of the Association’s
endowment required to be retained permanently,
either by explicit donor stipulation or by UPMIFA. The total investment return on the balances of these permanently restricted net assets is
restricted for the following:
CCA Alexa Dyer Fund 1
Make it Last Fund 2
$
$
120,548
250,000
370,548
1
Restricted for families of terminally-ill children.
Restricted to the annual operating and capital improvements
for the Caring Cabin.
2
At April 30, 2013, all donor-restricted endowment
funds were held in cash equivalents and pledges
receivable.
The following summarizes the Association’s endowment-related activity for the year ended April
30, 2013:
Permanently restricted endowment
funds at beginning of year
$
Contributions
Appropriation of endowment
assets for expenditure
Permanently restricted endowment
funds at end of year
120,000
250,548
–
$
370,548
Contributions and grants for the year ended April
30, 2013 totaled $3,312,479, as follows:
Contributions:
Contributions
Grants
$
557,852
335,500
893,352
In-kind contributions:
Contributed services – operations 1
Contributed services – special
events 1
Materials and supplies – operations 2
Materials and supplies – special
events 2
Free use of facilities - operations
428,944
13,770
239,622
31,986
21,498
735,820
Special events:
Celebration of Courage Series
BUZZ radio-a-thon
Other internally-sponsored events
Other externally-sponsored events
Less direct expenses incurred
811,598
358,617
327,038
432,954
(246,900)
1,683,307
$ 3,312,479
1
Consistent with the requirements of FASB ASC No. 958-605,
Revenue Recognition, the Association reports as revenue the
fair value of contributed services received where the services
require specialized skills, are provided by individuals possessing these skills, and represent services that would have been
purchased had they not been donated. During the year ended
April 30, 2013, the Association recorded $442,714 in total contributed services, including contributed services related to special events.
2
In-kind contributions of materials and supplies are recorded
where there is an objective basis upon which to value these
gifts and where the contributions are an integral part of the
Association’s activities. During the year ended April 30, 2013,
the Association recorded $271,608 in total donated materials
and supplies, including donated materials and supplies related
to special events.
16
In addition to these contributions and grants, the
Association regularly receives contributed services
from a large number of volunteers who assist in
fundraising and other efforts through their participation in a range of events and by working
with members of the Association staff in a variety
of capacities. Consistent with FASB ASC No.
958-605, Revenue Recognition, the value of such
services, which the Association considers not
practicable to estimate, have not been recognized
in the accompanying financial statements.
Excluded from the preceding table are the Association’s endowment gifts and other nonoperating support received during the year.
9.
Net Assets Released from Restrictions
During the year ended April 30, 2013, the Association incurred expenses totaling $276,951 in satisfaction of the restricted purposes imposed on contributions by donors, or otherwise had restrictions expire.
10. Expenses
The costs of providing the various programs and
other activities of the Association 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.
Expenses by their natural classification are presented in the statement of functional expenses.
11. Operating Lease Commitments
During the year ended April 30, 2013, the Association entered into a noncancelable operating lease
agreement for its administrative offices that expires in October of 2013. The Association also
leases certain office equipment through operating
leases that expire in various years through 2016.
The annual lease commitments under these leases
are payable as follows:
Years ending April 30,
2014
2015
2016
$
37,561
9,808
1,932
$
49,301
Rent expense of the above leases for the year ended April 30, 2013 totaled $56,908.
Subsequent to April 30, 2013, the Association entered into a new lease agreement for its administrative offices and renegotiated an equipment
lease agreement that expire in October 2023 and
June of 2015, respectively. The new administrative office lease will commence on August 5, 2013.
The future minimum rental commitment under
this agreement totals approximately $1,563,411
for the ten-year period (monthly payments of
$11,368 monthly in the first year, with a 3.0%
rate increase annually). The new equipment lease
agreement became effective May 29, 2013. The
future minimum rental commitment under this
agreement totals approximately $42,900 for the
five- year period (approximately$8,500 per year).
17
12. Employee Retirement Benefits
The Association has established a Simple IRA deferred savings plan for its employees. Employees
become eligible to participate in the plan as of
their date-of-hire and may elect to contribute up
to the statutory limit allowed. The Association
matches all employee contributions up to 3.0% of
participating employees’ compensation. Matching contributions are 100% vested as contributed.
Contributions to the plan totaled $33,666 for the
year ended April 30, 2013.
13. Fair Value Measurements
The accompanying financial statements report the
Association’s cash surrender value of life insurance policies (reported in prepaid expenses and
other assets in the statement of financial position)
at fair value. These assets have been classified,
for disclosure purposes, based on a hierarchy defined by FASB ASC No. 820, Fair Value Measurements and Disclosures. The hierarchy gives
the highest ranking to fair values determined using unadjusted quoted prices in active markets for
identical assets and liabilities (Level 1) and the
lowest ranking to fair values determined using
methodologies and models with unobservable inputs (Level 3).
At April 30, 2013, all of the Association’s assets
reported at fair value are measured using inputs
that include quoted prices for similar assets in active markets (i.e., a market appraisal; Level 2).
18
14. Reconciliation of Statement of Cash
Flows
The following presents a reconciliation of the increase in net assets (as reported on the statement
of activities) to net cash provided by operating activities (as reported on the statement of cash
flows):
Increase in net assets
$
Adjustments to reconcile increase
in net assets to net cash provided by
operating activities:
Depreciation
Provision for noncollection
of pledges receivable
Proceeds from contributions
restricted for long-term
investment
Net changes in:
Contributions receivable
Prepaid expenses and
other assets
Accounts payable and
accrued expenses
Accrued payroll liabilities
358,277
182,007
15,472
(548)
(317,580)
(43,016)
20,492
(9,952)
Total adjustments
153,125
Net cash provided by
operating activities
$
205,152
Schedule 1
CHILDREN'S CANCER ASSOCIATION
CONSOLIDATING SCHEDULE OF FINANCIAL POSITION
APRIL 30, 2013
Children's
Cancer
Association
The Foundation
of the Children's
Cancer
Association
Consolidating
elimination
entries
Total
Assets:
Cash and cash equivalents
Contributions and other receivables
Prepaid expenses and other assets
Property held for sale
Property and equipment
Total assets
$
865,243
258,815
85,668
187,504
345,410
145,958
252,500
3,675
−
1,072,171
−
(2,500)
−
−
−
1,011,201
508,815
89,343
187,504
1,417,581
$
1,742,640
1,474,304
(2,500)
3,214,444
Liabilities:
Accounts payable and accrued expenses
Accrued payroll liabilities
Assets held for others
Note payable
Total liabilities
68,477
173,222
75,000
56,600
−
−
−
−
(2,500)
−
−
−
65,977
173,222
75,000
56,600
373,299
−
(2,500)
370,799
Net assets:
Unrestricted
Temporarily restricted
Permanently restricted
Total net assets
Total liabilities and net assets
$
1,091,034
278,307
−
1,103,756
−
370,548
−
−
−
2,194,790
278,307
370,548
1,369,341
1,474,304
−
2,843,645
1,742,640
1,474,304
(2,500)
3,214,444
19
Schedule 2
CHILDREN'S CANCER ASSOCIATION
CONSOLIDATING SCHEDULE OF ACTIVITIES
YEAR ENDED APRIL 30, 2013
Children's
Cancer
Association
The Foundation
of the Children's
Cancer
Association
Consolidating
elimination
entries
Total
Operating revenues, gains, and other support:
3,312,479
30,384
−
30,140
−
(30,000)
3,312,479
30,524
3,342,863
30,140
(30,000)
3,343,003
Program services:
Music Rx
Education and resources
LINK Family Enrichment program
Pediatric Chemo Pal Mentor program
Caring Cabin
Volunteer program
1,159,319
330,221
350,107
384,164
186,380
191,529
−
−
−
−
30,020
−
−
−
−
−
(30,000)
−
1,159,319
330,221
350,107
384,164
186,400
191,529
Total program services
2,601,720
30,020
(30,000)
2,601,740
Supporting services:
Management and general
Fundraising
191,882
439,812
1,840
−
−
−
193,722
439,812
Total supporting services
631,694
1,840
−
633,534
3,233,414
31,860
Contributions and grants
Investment income and other
$
Total operating revenues, gains, and other support
Expenses:
Total expenses
Increase (decrease) in net assets
before non-operating activities
109,449
Non-operating activities:
Endowment gifts
Total non-operating activities
Increase in net assets
Net assets at beginning of year
Net assets at end of year
20
$
(1,720)
(30,000)
3,235,274
−
107,729
−
250,548
−
250,548
−
250,548
−
250,548
109,449
248,828
−
358,277
1,259,892
1,225,476
−
2,485,368
1,369,341
1,474,304
−
2,843,645
CHILDREN’S CANCER ASSOCIATION
GOVERNING BOARD, MANAGEMENT, AND STAFF
AS OF JULY, 2013
Board of Directors
CHILDREN’S CANCER
ASSOCIATION
Andy Lytle, Board Chair
Division Vice President
Majestic Fine Wines
Paul Gulick, Board Chair Emeritus
Co-Founder, In-Focus
Founder, Clarity Visual Systems
Retired
Clare Hamill, Founding Board
Chair Emeritus
Vice President – Nike Growth
Initiatives
Nike, Inc.
Macie House, Board Finance
Chair
Director, Pacific Crest Securities
Cliff Ellis
Co-Founder
Children’s Cancer Association
Regina Ellis
Chief Executive Officer/
Co-Founder
Children’s Cancer Association
Don Antonucci
President
Regence BlueCross BlueShield
of Oregon
Paula Barran
Partner
Barran Liebman, LLP
Tim Cooper
Senior Vice President
Beecher Carlson
Andrea Corradini
Global Footwear Merchandising
Director – Action Sports
Nike, Inc.
Katherine Durham
Vice President, Marketing &
Communications
The Standard
Mark Fitkin
Executive Managing Director
CBRE Global Strategic Accounts
Mike Golub
Chief Operating Officer
Portland Timbers
Jeff Paustian
Managing Director – Investments
JGP Wealth Management Group
of Wachovia Securities
Tom Penn
Television Analyst
ESPN
Bob Proffitt
President & Chief Operating Officer
Alpha Broadcasting
Matthew Shelley, MD, MBA
National Vice President
Enterprise Health Services
Lisa Thompson
President
Icebreaker Nature Clothing
Dara Wilk
Management Consulting
The Wilk Group
Grant Hammersley
Chief Executive Officer
Opus Solutions & AMI
Greg Wolfe
Senior Director
Power Marketing & Origination
NextEra Resources
Kurt Higgins
Founder – President & CEO
FileString
Junki Yoshida
Chairman and CEO
Yoshida Group
Scott Hix
President & COO
Sol Republic
21
Bev Tollefson
Link Program Manager
Jeannie Ross
Chemo Pal Program Specialist
Diana Szymczak
Marketing Manager
Bree Thompson
Chemo Pal Program Specialist
Sierra Smith
Special Events Manager
Angela West
Finance & Operations Specialist
Kacy Smerke
Community Outreach &
Education Manager
Kate Spurgin
Foundation & Corporate
Relations Specialist
Clare Hamill, Board Secretary
Vice President & Chief
Operating Officer
Nike Affiliates
Nike, Inc.
Jake Ten Pas
MyMusicRx Senior Manager
Melissa Owens
Community Outreach &
Volunteer Specialist
Paul Gulick
Co-Founder, In-Focus
Founder, Clarity Visual Systems
Retired
Brian Stitt
MyMusicRx Program Support
THE FOUNDATION FOR THE
CHILDREN’S CANCER
ASSOCIATION
Tim Phillips, Board Chair
Chief Executive Officer
Phillips & Company
Regina Ellis, Board President
Chief Executive Officer/
Founder
Children’s Cancer Association
Management and Staff
Regina Ellis
Chief Executive Officer &Founder
Megan Byrtek
Chief Operating Officer
David Schaeffer
Vice President of Development
Shelly Charles
Director of Programs
Nicole McDonald
Director of Finance & Operations
Jennifer O’Bryan
Director of Special Events
Cliff Ellis
Caring Cabin Coordinator
22
Jacquelyn Westfall
MyMusicRx Program Manager
Kieran Schnabel
MyMusicRx Palliative Specialist
Matt French
MyMusicRx Specialist
Monica Metzler
MyMusicRx Specialist
Anna Spackman
MyMusicRx Specialist
Cheryl Kanekoa
Marketing Support
Katie Schafer
Chemo Pal Program Specialist
James Crowe
Database Specialist
Karen Crandal
Executive Assistant to
Regina Ellis, CEO & Founder
Rachel Trindle
Program Administrative Support
Rachel Marks
Office & Administrative Support
Chom Sou
Donor Relations Support
Christina Heesacker
Development Support
CHILDREN’S CANCER ASSOCIATION
INQUIRIES AND OTHER INFORMATION
CHILDREN’S CANCER ASSOCIATION
433 N.W. Fourth Avenue, Suite 100
Portland, Oregon 97209
(503) 244-3141
(503) 892-1922 (Fax)
[email protected]
Website
www.JoyRx.org
23