THE URBAN LEAGUE OF THE UPSTATE, INC.

THE URBAN LEAGUE OF THE UPSTATE, INC.
FINANCIAL STATEMENTS AND
SUPPLEMENTARY INFORMATION
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
THE URBAN LEAGUE OF THE UPSTATE, INC.
TABLE OF CONTENTS
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
Page No.
FINANCIAL SECTION
Independent Auditors’ Report
1
Statements of Financial Position
2
Statements of Activities
3
Statements of Cash Flows
4
Statements of Functional Expenses
Notes to the Financial Statements
5-6
7-12
~~:~~!::O~~~bert! Halliday
CERTIfiED PUBLIC ACCOUNTANTS AND CONSULTANTS
(9 Coo
~~~~~~~-------------------
Board of Directors
The Urban League of the Upstate, Inc.
15 Regency Hill Drive
Greenville, South Carolina
INDEPENDENT AUDITORS' REPORT
We have audited the accompanying statements of financial position of The Urban League of the Upstate,
Inc. (the "League") as of June 30, 2011 and 2010, and the related statements of activities, functional
expenses, and cash flows for the years then ended. These financial statements are the responsibility of
the League's management. Our responsibility is to express an opinion on these financial statements
based on our audit.
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 audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and the significant estimates made by
management, as well as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in ali material respects, the
financial position of The Urban League of the Upstate, Inc. as of June 30, 2011 and 2010, and the
changes in its net assets and its cash flows for the years then ended in conformity with accounting
principles generally accepted in the United States of America.
~~ ~ tLPJ~,,f (,
Spartanburg, South Carolina
October 18, 2011
-SEA REHOLDFRSHOMER E. McABEE, JR., CPA
CHARLES L. TALBERT, Ill, CPA
Q. STANFORD HALLIDAY, lll, CPA
BRUCE W. SCHWARTZ, CPA
-PRINCIPALRANDOLPH B. THOMAS, CPA
MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC
ACCOUNTANTS, PCPS AND SEC DIVISIONS; S.C ASSOCIATION OF CERTIFIED
PUBLIC ACCOUNTANTS; N.C ASSOCIATION OF CERTIFIED PUBLIC ACCOUNTANTS;
NATIONAL ASSOCIATED CPA FIRMS
824 E. MAIN STREET, 29302
SPARTANBURG, S.C
SPARTANBURG (864) 583-0886
TOLL FREE (800) 788-3193
FAX NUMBER (864) 594-4365
E-MAIL [email protected]
THE URBAN LEAGUE OF THE UPSTATE, INC
STATEMENTS OF FINANCIAL POSITION
JUNE 30, 2011 AND 2010
ASSETS
2011
Cash and Cash Equivalents:
Unrestricted
Restricted
Accounts Receivable, Net
Prepaid Expenses
Capital Assets, Net of Accumulated Depreciation
Total Assets
2010
$
102,410
4,969
179,255
10,814
102,280
$
117,090
21,398
136,126
11,750
116,804
$
399,728
$
403,168
$
44,108
902
50,959
163,814
$
25,942
965
28,654
207,342
LIABILITIES AND NET ASSETS
Liabilities:
Accounts Payable
Accrued Expenses
Refundable Advances
Notes Payable
Total Liabilities
259,783
262,903
Net Assets:
Unrestricted
139,945
140,265
Total Net Assets
139,945
140,265
Total Liabilities and Net Assets
$
The notes to the financial statements are an integral part of this statement.
2
399,728
$
403,168
3
$
$
-
-
-
-
-
-
-
-
(174,844)
174,844
-
The notes to the financial statements are an integral part of these statements.
139,945
Net Assets, End of Year
(320)
1,568,989
228,175
83,652
908,382
281,645
67,135
1,568,669
174,844
238,674
6,941
9,441
737,422
648
7,300
29,420
76,792
30,931
256,256
140,265
$
$
Unrestricted
Net Assets, Beginning of Year
Increase (Decrease) in Net Assets
Total Expenses
Supporting Services:
Management and General
Fund Raising
Expenses:
Program Services:
Family Works
Housing and Supporting Services
Economic Empowerment
Total Revenues, Gains, and Other Support
Revenues, Gains, and Other Support:
Fund Raising Activities
United Way of Greenville County:
Regular
Designations
United Way - Other Counties
Federal Financial Assistance
State Financial Assistance
Program Income
Interest Income
Contributions
Management Fees
Membership Fees
Other
Net Assets Released from Restrictions:
Satisfaction of Program Restrictions
2011
Temporarily
Restricted
$
139,945
140,265
(320)
1,568,989
228,175
83,652
908,382
281,645
67,135
1,568,669
-
238,674
6,941
9,441
737,422
648
182,144
29,420
76,792
30,931
$ 256,256
Total
$
140,265
117,389
22,876
1,772,290
188,884
87,437
862,115
395,583
238,271
1,795,166
213,453
256,000
6,268
22,320
859,835
23,169
5,845
3,058
7,380
34,614
50,543
110,471
202,210
Unrestricted
$
THE URBAN LEAGUE OF THE UPSTATE, INC
STATEMENTS OF ACTIVITIES
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
$
$
-
-
-
-
-
-
-
(213,453)
213,453
-
-
2010
Temporarily
Restricted
$
$
140,265
117,389
22,876
1,772,290
188,884
87,437
862,115
395,583
238,271
1,795,166
-
256,000
6,268
22,320
859,835
23,169
5,845
3,058
220,833
34,614
50,543
110,471
202,210
Total
THE URBAN LEAGUE OF THE UPSTATE, INC
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
2011
Cash Flows from Operating Activities
Change in Net Assets
$
Adjustments to Reconcile the Change in Net Assets to the Net Cash
Provided by (Used for) Operating Activities:
Depreciation
Decrease (Increase) in Accounts Receivable
Decrease (Increase) Prepaid Expenses
Increase (Decrease) in Accounts Payable
Increase (Decrease) in Accrued Expenses
Increase (Decrease) in Refundable Advances
Net Cash Provided (Used) by Operating Activities
2010
(320)
$
22,876
14,524
(43,129)
936
18,166
(63)
22,305
15,629
86,052
(2,663)
19,975
(22,408)
(68,146)
12,419
51,315
Cash Flow from Investing Activities
Purchase of Capital Assets
-
(25,629)
Net Cash Provided (Used) by Investing Activities
-
(25,629)
Cash Flows from Financing Activties
Payments on Line of Credit
Payments on Long-term Debt
Proceeds from Issuance of Long-term Debt
(9,842)
(187,598)
153,912
(54,984)
(1,521)
25,628
Net Cash Provided (Used) by Financing Activities
(43,528)
(30,877)
Net Increase (Decrease) in Cash and Cash Equivalents
(31,109)
(5,191)
Cash and Cash Equivalents, Beginning of Year
138,488
143,679
Cash and Cash Equivalents, End of Year
$
107,379
$
138,488
Supplement Disclosure of Cash Flow Information:
Interest Paid During the Year
$
10,854
$
9,157
The notes to the financial statements are an integral part of this statement.
4
5
$ 908,382
6,500
901,882
40,068
44,316
38,167
20,962
1,870
18,427
973
4,261
19,409
100,818
4,349
5,977
7,437
45,274
11,494
8,300
2,206
12,584
-
514,990
$
281,645
1,325
280,320
14,159
2,090
4,937
10,314
348
6,272
434
1,322
3,791
9,089
1,180
2,075
1,025
10,008
3,458
1,500
684
1,363
-
206,271
$
The notes to the financial statements are an integral part of this statement.
Total Expenses
Depreciation
Total Expenses Before Depreciation
Occupancy Costs
Travel and Transportation
Client related meetings
Equipment rental and maintenance
Advertising
Telephone
Memberships
Printing and Copying
Supplies
Professional Services
Postage
Interest
Scholarships
Individual Assistance
General insurance
National Urban League Dues
Bad Debt Expense
Miscellaneous
Cost of Fund Raising Activities
Total Salaries and Related Benefits
Salaries
Employee Benefits
Payroll Taxes
Family
Works
$ 402,635
73,902
38,453
67,135
-
67,135
9,040
1,524
3,906
2,458
1,277
44
315
2,786
1,893
281
360
2
2,411
200
163
325
-
40,150
PROGRAM SERVICES
Housing &
Supporting
Economic
Services
Empowerment
$
151,824
$
30,524
40,429
6,911
14,018
2,715
$ 1,257,162
7,825
1,249,337
63,267
47,930
47,010
33,734
2,218
25,976
1,451
5,898
25,986
111,800
5,810
8,412
8,462
55,284
17,363
10,000
3,053
14,272
-
761,411
Total
Program
Services
$ 584,983
121,242
55,186
$
228,175
6,699
221,476
14,798
4,778
12,486
4,793
3,959
564
2,832
7,741
12,660
3,628
2,442
24
1,822
2,102
4,189
-
142,658
$ 83,652
-
83,652
1,228
79,233
3,191
$
311,827
6,699
305,128
14,798
4,778
12,486
4,793
3,959
564
4,060
7,741
12,660
3,628
2,442
24
1,822
2,102
4,189
79,233
145,849
SUPPORTING SERVICES
Management &
Total
General
Fund
Supporting
Services
Raising
Services
$
109,917
$ 2,798
$
112,715
23,364
128
23,492
9,377
265
9,642
THE URBAN LEAGUE OF THE UPSTATE, INC
STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED JUNE 30, 2011
$ 1,568,989
14,524
1,554,465
78,065
52,708
59,496
38,527
2,218
29,935
2,015
9,958
33,727
124,460
9,438
10,854
8,462
55,308
19,185
10,000
5,155
18,461
79,233
907,260
Total
Expenses
$ 697,698
144,734
64,828
6
$ 862,115
8,148
853,967
36,187
50,546
29,165
20,466
1,879
12,050
790
6,206
17,894
122,741
2,786
5,039
3,891
24,979
10,149
8,500
6,499
-
494,200
$
395,583
2,649
392,934
11,990
3,920
9,146
10,857
676
6,137
780
2,795
4,461
12,669
850
1,986
18,900
29,562
3,128
1,400
2,276
-
271,401
$
The notes to the financial statements are an integral part of this statement.
Total Expenses
Depreciation
Total Expenses Before Depreciation
Occupancy Costs
Travel and Transportation
Client related meetings
Equipment rental and maintenance
Advertising
Telephone
Memberships
Printing and Copying
Supplies
Professional Services
Postage
Interest
Scholarships
Individual Assistance
General insurance
National Urban League Dues
Bad Debt Expense
Miscellaneous
Cost of Fund Raising Activities
Total Salaries and Related Benefits
Salaries
Employee Benefits
Payroll Taxes
Family
Works
$ 391,522
70,026
32,652
238,271
-
238,271
12,755
9,036
7,268
5,438
3,216
104
1,683
3,975
26,352
685
541
84,964
51
3,626
100
769
-
77,708
PROGRAM SERVICES
Housing &
Supporting
Economic
Services
Empowerment
$
209,595
$
61,113
44,000
12,027
17,806
4,568
$ 1,495,969
10,797
1,485,172
60,932
63,502
45,579
36,761
2,555
21,403
1,674
10,684
26,330
161,762
4,321
7,566
107,755
54,592
16,903
10,000
9,544
-
843,309
Total
Program
Services
$ 662,230
126,053
55,026
$
188,884
4,832
184,052
11,109
3,854
8,030
6,039
3,772
364
4,351
6,081
5,184
1,476
1,591
179
1,405
2,515
-
128,102
35
$ 87,437
-
87,437
1,570
199
188
69,893
-
15,552
$
276,321
4,832
271,489
11,109
3,889
8,030
6,039
3,772
364
5,921
6,081
5,184
1,675
1,591
179
1,405
2,703
69,893
143,654
SUPPORTING SERVICES
Management &
Total
General
Fund
Supporting
Services
Raising
Services
$
102,223
$ 11,335
$
113,558
17,917
3,392
21,309
7,962
825
8,787
THE URBAN LEAGUE OF THE UPSTATE, INC
STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED JUNE 30, 2010
$ 1,772,290
15,629
1,756,661
72,041
67,391
53,609
42,800
2,555
25,175
2,038
16,605
32,411
166,946
5,996
9,157
107,755
54,771
18,308
10,000
12,247
69,893
986,963
Total
Expenses
$ 775,788
147,362
63,813
THE URBAN LEAGUE OF THE UPSTATE, INC.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
NOTE 1 – NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES
Organization
The Urban League of the Upstate, Inc. (the “League”), an affiliate of the National Urban League, Inc.,
was organized and incorporated under the laws of the State of South Carolina in 1972 as a taxexempt, 501(c)(3) not-for-profit organization.
The League’s mission is to enable African-Americans and others in need to attain economic selfsufficiency through our advocacy, collaboration and targeted services focused on education, job
training and employment. The following is a description of the League’s program activities.
Family Works:
Economic Empowerment:
Housing:
The Family Works function is used to record activities and programs
associated with providing services for families and children.
The Economic Empowerment function is used to record activities
associated with providing job training and job placement for
individuals.
The Housing function is used to record activities associated with the
League assisting low income people with finding and securing
housing and housing related service.
Basis of Accounting
The financial statements presented herein have been prepared on the accrual basis of accounting in
accordance with accounting principles generally accepted in the United States. Under the accrual
basis of accounting, revenues are recorded as earned and expenses are recorded at the time
liabilities are incurred.
Basis of Presentation
The League reports information regarding its financial position and activities according to three
classes of net assets; unrestricted net assets, which represents the expendable resources that are
available for the operations at management’s discretion; temporarily restricted net assets, which
represent resources restricted by donors as to the purpose or by passage of time; and permanently
restricted net assets, which represents resources whose use by the League is limited by donorimposed stipulations that neither expire by the passage of time nor can be fulfilled or otherwise
removed by actions of the League.
Cash and Cash Equivalents
The League considers all highly liquid investments with an initial maturity of three months or less to
be cash equivalents.
Accounts Receivable
The accounts receivable represent amounts due from federal, state, local governmental entities,
private foundations, and other grantors. In addition, accounts receivable also includes amounts due
from related organizations for salaries, payroll taxes, fringe benefits, and other expenses for services
provided to related organizations (see Note 8 for additional information). Management has
determined that the receivables are fully collectible; therefore, no allowance for uncollectible accounts
is deemed necessary at June 30, 2011 and 2010.
7
THE URBAN LEAGUE OF THE UPSTATE, INC.
NOTES TO THE FINANCIAL STATEMENTS - Continued
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
NOTE 1 – NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES - Continued
Capital Assets
The League follows the practice of capitalizing all expenditures in excess of $5,000 for property and
equipment at costs; the fair market value of donated capital assets is similarly capitalized.
Depreciation is provided over the estimated useful lives of the respective assets on a straight-line
basis as follows: Buildings and Improvements - 20 years and Vehicles and Equipment - 3 to 7 years.
Routine repairs and maintenance are expensed as incurred.
Restricted and Unrestricted Revenue and Support
Contributions received are recorded as unrestricted, temporarily restricted, or permanently restricted
support, depending upon the existence or nature of any donor restrictions. Support that is restricted
by the donor is reported as an increase in unrestricted net assets if the restrictions expire in the
reporting period in which the support is recognized. All other donor-restricted support is reported as
an increase in temporarily or permanently restricted net assets, depending on the nature of the
restriction. 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.
The League’s programs are supported by revenues received in the form of federal, state and local
grants, allocations from the United Way, or designated contributions from the general public.
Contributions of non-cash assets are recorded at their fair values in the period received.
Refundable Advances
The League records grant awards accounted for as exchange transactions as refundable advances
until the related services are performed, at which time they are recognized as revenue.
Functional Expenses
Expenses are charged directly to program or supporting services in general categories based on
specific functional identification. Indirect expenses have been allocated based on the percentage of
total expenses by program prior to the allocation of those expenses. The League has three program
activities in addition to its supporting service activities.
Indirect Cost Allocation
The League has adopted the provisions of OMB Circular A-122, Cost Principles for Not-for-Profit
Organizations published by the Office of Management and Budget which provides for the
identification and accumulation of allowable indirect costs and their distribution to the applicable
programs based on total expenses.
Estimates
The preparation of financial statements, in conformity 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
reported period. Actual results could differ from those estimates.
8
THE URBAN LEAGUE OF THE UPSTATE, INC.
NOTES TO THE FINANCIAL STATEMENTS - Continued
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
NOTE 1 – NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES - Continued
Fair Value
The carrying amount of other assets, including cash, accounts receivable and accounts payable
approximates their fair market value due to the short – term maturities of these instruments.
NOTE 2 – CASH AND CASH EQUIVALENTS
The League’s financial instruments that are exposed to concentrations of credit risk consist of cash
and cash equivalents placed with federally insured financial institutions. Such accounts may at times
exceed federally insured limits. At June 30, 2011 and 2010, the balances such accounts did not
exceed federally insured limits. Cash and cash equivalents consisted of the following at June 30:
2011
Unrestricted
Operating cash
Certificate of deposit
Money Market
Petty cash
Restricted
Young professionals
Emergency assistance
IDA Operating
Administration
Total Cash and Cash Equivalents
2010
$
26,290
5,846
69,974
300
102,410
$
41,420
5,837
69,533
300
117,090
$
1,992
26
2,710
241
4,969
$
1,580
26
3,729
16,063
21,398
$ 107,379
$ 138,488
The Community Foundation of Greater Greenville manages endowment funds amounting to
approximately $141,408 and $127,305 June 30, 2011 and 2010 respectively, from which the income
is designated for the League. The principal is to be maintained inviolate and in perpetuity.
NOTE 3 – ACCOUNTS RECEIVABLE
Accounts receivable
Less: allowance for uncollectible amounts
2011
$ 179,255
-
2010
$ 136,126
-
Accounts receivable, net
$ 179,255
$ 136,126
The receivables consisted mainly of receivables from the federal, state and local governments and
related organizations (See Note 8).
9
THE URBAN LEAGUE OF THE UPSTATE, INC.
NOTES TO THE FINANCIAL STATEMENTS - Continued
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
NOTE 4 – CAPITAL ASSETS
Capital assets consisted of the following:
Land
Buildings and improvements
Vehicles and equipment
Balance at
June 30, 2010
$
50,000
259,038
236,385
545,423
Less: Accumulated depreciation
Buildings and improvements
Vehicles and equipment
Total Accumulated Depreciation
Capital Assets, Net
Additions
$
-
Disposals
$
-
-
-
Balance at
June 30, 2011
50,000
259,038
236,385
545,423
3,044
11,480
14,524
-
241,667
201,245
443,142
238,623
189,765
428,619
$
116,804
$ (14,524)
$
-
$
102,280
NOTE 5 – NOTES PAYABLE
The League had a $250,000 line of credit available at an interest rate equal to the one month
adjusted LIBOR Index that matured in January 2010. As of June 30, 2009, the outstanding balance
on the line of credit was $238,219. In March 2010, the line of credit was refinanced into two loans, a
$173,219 term loan and a $25,000 line of credit. Both loans have interest payable monthly at an
interest rate of the greater of prime plus 1.1% or 5.0%. As of June 30, 2010, the balance on the term
loan was $173,219 and the outstanding balance on the line of credit was $9,928.
In March 2011, the term loan was renewed for $153,912 and now matures on March 5, 2014, and
bears interest at the rate of 5.15%. The term loan is secured by the League’s real and personal
property. At the same date, the line of credit was increased from $25,000 to $50,000, which is
payable on demand. As of June 30, 2011 the outstanding balance on the term loan was $144,823.
There was no balance outstanding as of June 30, 2011 for the line of credit.
In February 2010, the League obtained a note payable to finance the purchase of a vehicle. The note
is due in sixty monthly installments, with interest payable at 4.9%. The outstanding balance on the
loan was $18,991 and $24,108 as of June 30, 2011 and 2010, respectively.
Schedule future maturities of long-term debt are as follows:
Year Ended June 30
2012
2013
2014
2015
17,169
18,486
124,369
3,790
$
10
163,814
THE URBAN LEAGUE OF THE UPSTATE, INC.
NOTES TO THE FINANCIAL STATEMENTS - Continued
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
NOTE 6 – PENSION PLAN
Employees who have attained age twenty-one and completed one thousand hours of service during
each full year may participate in a 403(b) Thrift Plan, which constitutes a defined contribution plan.
Under the plan, the League contributes 6% of the annual compensation of covered employees. For
the years ended June 30, 2011 and 2010, pension expense was $36,913 and $41,232, respectively.
NOTE 7 – OPERATING LEASES
The League has several non-cancelable operating leases for copier, postage and
telecommunications equipment. Rental expenses for these leases were $39,522 and $44,012 for the
years ended June 30, 2011 and 2010.
NOTE 8 – RELATED ORGANIZATION TRANSACTIONS
The League recorded management fee income of approximately $21,004 and $26,894 for the years
ended June 30, 2011 and 2010, respectively, from Greenville Urban League Senior Housing
Corporation (“Gandy I”) for management services. The certificate of incorporation for Gandy I
provides that (1) membership in Gandy I shall be limited to individuals who are sitting directors of the
League, including the executive director of the League and (2) the board of directors will be
composed of six directors, all of whom must be sitting members of the board of directors of the
League. Effective July 1, 2010, the management fee was reduced from 7.5% to 6% of Gandy I
apartment rental fees. The League pays salaries, payroll taxes, and employee benefits for Gandy I’s
employees and bills Gandy I monthly for reimbursement. Salaries and related expense paid by the
Urban League on behalf of Gandy I for the years ended June 30, 2011 and 2010 were $40,682 and
$30,770, respectively. During 2010, the League collected $108,180 of previously written off and past
due receivables from Gandy I.
The League recorded management fee income of approximately $8,416 and $7,720 for the years
ended June 30, 2011 and 2010 from The Urban League of the Upstate Senior Housing Corporation
(“Gandy II”) for management services. The certificate of incorporation for Gandy II provides that (1)
Gandy II shall not have members, (2) the board of directors shall consist of six directors and (3) the
members of the board of directors for Gandy II shall, at all times, be limited to individuals who are
either current members of the League or nonmembers who have and maintain the approval of the
board of directors of the League. The management fee is based on 7.5% of Gandy II apartment
rental fees. The League pays salaries, payroll taxes, and employee benefits for Gandy II’s
employees and bills Gandy II monthly for reimbursement. Salaries and related expense paid by the
Urban League on behalf of Gandy II for the years ended June 30, 2011 and 2010 were $11,304 and
$12,137, respectively.
The following amounts were outstanding from Gandy I and Gandy II as of June 30:
Reimbursements due
Less: Allowance for uncollectible
amounts
Gandy I
2011
2010
$
3,722
$ (1,484)
$
3,722
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Gandy II
2011
2010
$
1,230
$
5,336
$
(1,484)
$
1,230
$
5,336
THE URBAN LEAGUE OF THE UPSTATE, INC.
NOTES TO THE FINANCIAL STATEMENTS - Continued
FOR THE YEARS ENDED JUNE 30, 2011 AND 2010
NOTE 9 – CONTINGENT LIABILITIES
The Urban League of the Upstate, Inc. participates in a number of federal and state assisted
programs, which are governed by various rules and regulations of grantor agencies. These programs
are subject to financial and compliance audits by the grantor agencies or their representatives. Such
audits could lead to request for reimbursements to the grantor agency for expenditures disallowed
under terms of the grant. The Urban League of the Upstate, Inc. believes it has substantially
complied with the contract/grant provisions. Management believes such disallowances, if any, would
not be material; therefore, no provision has been recorded in the accompanying financial statements
for such contingencies.
Due to the operating results of Gandy I and Gandy II (the “Projects”), the League has a history of
funding any cash shortfalls of the Projects.
NOTE 10 – RISK MANAGEMENT
The League is exposed to various risks of loss related to torts; thefts of, damage to, and destruction
of assets; errors and omissions; injuries to employees; and natural disasters. The League continues
to carry commercial insurance for general liability and workers’ compensation. Settled claims
resulting from these risks have not exceeded commercial insurance coverage in the past two years
and there has been no significant reduction in insurance coverage.
NOTE 11 – SUBSEQUENT EVENTS
The League has borrowed $50,000 on the line of credit subsequent to June 30, 2011.
Subsequent events were evaluated through October 18, 2011, which is the date the financial
statements were available to be issued.
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