CASE - Calcasieu Association for Social Enrichment,...
Transcript of CASE - Calcasieu Association for Social Enrichment,...
CALCASIEU ASSOCIATION FOR SOCIAL ENRICHMENT, INC.
FINANCIAL STATEMENTSAND INDEPENDENT AUDITORS' REPORT
JUNE 30,2007
Under provisions of state law, this report is a publicdocument. A copy of the report has been submitted tothe entity and other appropriate public officials, Thereport is available for public inspection at the BatonRouge office of the Legislative Auditor and, whereappropriate, at the office of the parish clerk of court.
Release Date
CONTENTS
Page
Independent Auditors' Report 3
Financial Statements:Statement Of Financial Position 4
Statement Of Activities 5
Statement Of Functional Expenses 6
Statement Of Cash Flows 7
Notes To The Financial Statements 8-10
Independent Auditors' Report on Internal ControlOver Financial Reporting and Compliance and OtherMatters Based on an Audit of Financial StatementsPerformed in Accordance with Government AuditingStandards 11-12
Schedule of Findings 13
Schedule of Prior Year Findings 14
Management's Corrective Action Plan 15
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INDEPENDENT AUDITORS' REPORT
Board of DirectorsCalcasieu Association for SocialEnrichment, Inc.
We have audited the accompanying statement of financial position of Calcasieu Association for SocialEnrichment, Inc. (a non-profit organization) as of June 30, 2007 and the related statements of activities,functional expenses, and cash flows for the year then ended. These financial statements are theresponsibility of the Organization's management. Our responsibility is to express an opinion on thesefinancial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards,issued by the Comptroller General of the United States. Those standards require that we plan and performthe audit to obtain reasonable assurance about whether the financial statements are free of materialmisstatement. An audit includes examining, on a test basis, evidence supporting the amounts anddisclosures in the financial statements. An audit also includes assessing the accounting principles used andsignificant estimates made by management, as well as evaluating the overall financial statementpresentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, thefinancial position of Calcasieu Association for Social Enrichment, Inc. as of June 30, 2007, and the changesin its net assets and its cash flows for the year then ended in conformity with accounting principlesgenerally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated August 16, 2007,on our consideration of Calcasieu Association for Social Enrichment, Inc.'s internal control over financialreporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, andgrant agreements and other matters. The purpose of that report is to describe the scope of our testing ofinternal control over financial reporting and compliance and the results of that testing and not to provide anopinion on the internal control over financial reporting or on compliance. That report is an integral part ofan audit performed in accordance with Government Auditing Standards and should be read in conjunctionwith this report in considering the results of our audit
McMullen and Mancuso, CPAs, LLC
August 16, 2007
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CALCASIEU ASSOCIATION FOR SOCIAL ENRICHMENT, INC.
STATEMENT OF FINANCIAL POSITION
June 30,2007
ASSETS
Current Assets:
Cash and Cash Equivalents
Prepaid Insurance
Total Current Assets
16,672
1,887
18,559
Fixed Assets:
Leasehold Improvements
Furniture and Equipment
Vehicle
Less: Accumulated Depreciation
Total Fixed Assets
7,155
103,348
13,760
124,263
(117,727)
6,536
Other Assets:
Utility Deposit
TOTAL ASSETS
LIABILITIES AND NET ASSETS
150
25,245
Current Liabilities:
Accounts Payable
Total Current Liabilities
Net Assets:
Unrestricted:
Operations
Fixed Assets
Total Net Assets
TOTAL LIABILITIES AND NET ASSETS
13,665
6,536
5,044
5,044
20,201
25,245
The accompanying notes are an integral part of these financial statements.
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CALCASIEU ASSOCIATION FOR SOCIAL ENRICHMENT, INC.
STATEMENT OF ACTIVITIES
For the Year Ended Jane 30,2007
SUPPORT:
Grants and Contracts
Use of Contributed Facilities
Contributions
Total Support
Net Assets Released From
Restrictions
TOTAL SUPPORT
EXPENSES:
Program Services:
Upward Bound Tutorial Program
Supporting Services:
General and Administrative
TOTAL EXPENSES
CHANGE IN NET ASSETS
NET ASSETS AT BEGINNING OF YEAR
NET ASSETS AT END OF YEAR
2007
Temporarily
Unrestricted Restricted
- $ 110,000 $
11,200
5,574
16,774 110,000
110,000 (110,000)
126,774
82,251
26,985
109,236
17,538
(20,021) 22,684
(2,483) $ 22,684 $
Total
110,000
11,200
5,574
126,774
126,774
82,251
26,985
109,236
17,538
2,663
20,201" "'^B
The accompanying notes are an integral part of these financial statements.
CALCASIEU ASSOCIATION FOR SOCIAL ENRICHMENT, INC.
STATEMENT OF FUNCTIONAL EXPENSES
For the Year Ended June 30,2007
Salaries
Payroll Taxes
Worker's Compensation Insurance
Total Salaries and Related Expenses
Rent
Telephone
Utilities
Office / Program Supplies
Postage
Building Maintenance Supplies
SecurityCable/Internet
Membership Fees / Dues
Insurance
Auditing Fees
Program Activity
Equipment Repairs
New Equipment
Travel / Conference
Interest Expense
Auto Insurance
Total Expenses Before Depreciation
Depreciation of Fixed Assets
Total Expenses
Program
Services
(UBTP)
51,499
4,804
779
57,082
General
and Total
Administrative Expenses
12,501
1,201
195
13,897
64,000
6,005
974
70,979
8,9601,6762,7244192580237838531
1,529-
1,2392,292
6361-799
78,464
3,787
82,251 $
2,240186
6813,07018120195438
3823,500
-57316
641,427-
26,564
421
26,985 $
11,2001,8623,4053,489205
1,00347342839
1,9113,5001,2392,86579125
1,427799
105,028
4,208
109,236»•' ' ^
The accompanying notes are an integral part of these financial statements.
CALCASIEU ASSOCIATION FOR SOCIAL ENRICHMENT, INC.
STATEMENT OF CASH FLOWS
For the Year Ended June 30,2007
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
Increase in Net Assets
Adjustments to Reconcile Change in Net Assets
to Net Cash Used for Operating Activities:
Depreciation
(Increase) Decrease in Prepaid Insurance
Increase (Decrease) in Accounts Payable
Increase (Decrease) in State Withholding Payable
Net Cash Provided by Operating Activites
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of equipment
Net Cash Used for Investing Activities
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on line of credit
Net Cash Used for Financing Activities
Net Increase in Cash and Cash Equivalents
CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS - END OF YEAR
$ 17,538
4,208
(724)
4,746
(158)
(4.167)
(6,150)
25,610
(4,167)
(6,150)
15,293
1,379
$ 16,672
Disclosures:
Interest paid for the year ended June 30,2007 was $1,427.
The accompanying notes are an integral part of these financial statements.
CALCASIEU ASSOCIATION FOR SOCIAL ENRICHMENT, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30,2007
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1. Nature of Activities
Calcasieu Association for Social Enrichment, Inc. is a not-for-profit community outreachprogram, providing services to primarily under-privileged children and youth. It offersassistance in training for disenfranchised youth, and supplementary and tutorial services forstudents who have trouble succeeding in the traditional classroom, and others who needassistance.
2. Basis of Accounting
The financial statements have been prepared using the accrual basis of accounting and inconformity with the standards promulgated by the American Institute of Certified PublicAccountants in its audit guide for voluntary health and welfare organizations.
3. Financial Statement Presentation
| The financial statement presentation follows the recommendation of the Financial AccountingStandards Board in its Statement of Financial Accounting Standards (SFAS) No. 117,"Financial Statements of Not-for-Profit Organizations." Under SFAS 117, the Organization is
; required to report information regarding its financial position and activities according to threeclasses of net assets: unrestricted net assets, which represent the expendable resources thatare available for operations at management's discretion; temporarily restricted net assets,which represent resources restricted by donor's as to purpose or by the passage of time; and
j permanently restricted net assets, which represent resources whose use by the Organization is{ limited by donor-imposed stipulations that neither expire by passage of time nor can bej fulfilled or otherwise removed by actions of the Organization. The Organization did not have
any permanently restricted net assets this year.
4. Fixed Assets
Fixed Assets are stated at cost at the date of acquisition and any donated fixed assets arerecorded as support at their estimated fair value at the date of donation. Depreciation iscomputed by the straight-line method beginning in the year of acquisition, at rates based onthe following estimated useful lives:
YearsLeasehold Improvements 10Furniture and Fixtures 5 to 10Equipment 5 to 10Vehicle 4
CALCASIEU ASSOCIATION FOR SOCIAL ENRICHMENT, INC.
NOTES TO FINANCIAL STATEMENTS
TUNE 30, 2007
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4. Fixed Assets (Continued)
Depreciation expense for the year ended June 30, 2007, was $4,208 and is reported asprogram and supporting services in the statement of activities. The Organization follows thepractice of capitalizing all expenditures for all fixed assets.
Fixed assets acquired by Calcasieu Association for Social Enrichment, Inc. are considered tobe owned by Calcasieu Association for Social Enrichment, Inc. However, state fundingsources may maintain equitable interest in the property purchased with grant monies as wellas the right to determine the use of any proceeds from the sale of these assets. The State has areversionary interest in those assets purchased with its funds.
5. Contributed Facilities
Contributed facilities represent the estimated fair rental value of office and classroom spaceprovided. Contributed facilities are provided under a lease contract with the Calcasieu ParishSchool Board whereby they are allowed free use of the facilities for the lease contract periodfrom July 1, 2003 through June 30, 2008. The fair rental value of the contributed lease was$1 1,200 for the year ended June 30, 2007.
6. Income Tax Status
The Organization is exempt from Federal income taxes under Internal Revenue Code Section501(c)(3) and therefore has made no provision for Federal income taxes. They are consideredby the Internal Revenue Service to be a nonprivate foundation under the provision IRC
7. Functional Allocation of Expenses
The costs of providing the Organization's program and supporting services have beensummarized on a functional basis in the statement of activities. Accordingly, certain costshave been allocated among the program and supporting services benefited.
8. Cash and Cash Equivalents
For purpose of the statement of cash flows, the Organization considers all unrestricted, highlyliquid investments with initial maturities of three months of less to be cash equivalents.
9. Use of Estimates
The preparation of financial statements in conformity with generally accepted accountingprinciples requires the use of management's estimates and assumptions that affect the
CALCASIEU ASSOCIATION FOR SOCIAL ENRICHMENT, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30,2007
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
9. Use of Estimates (Continued)
reported amounts of assets and liabilities and disclosures of contingent assets and liabilities atthe date of the financial statements and the reported amounts of revenues and expenses duringthe reporting period. Accordingly, actual results could differ from those estimates.
NOTE B - LINE OF CREDIT!
I As of June 30, 2007, the Organization had an unsecured line of credit with Capital One Bank,which has an amount available for borrowing up to $30,000. Borrowings under the line of creditare payable upon demand with interest payable monthly at 11.25%. As of June 30, 2007, thebalance on the line of credit was zero. The maturity on the line of credit is July 26,2007.
• i}I\ NOTE C - CONCENTRATION AND ECONOMIC DEPENDENCYi
Grant revenue received in the year ended June 30,2007 from the Department of Education, Officeof School and Community Support, of the State of Louisiana was $100,000, which comprised 91%of total grant funding. If that grant were not renewed, the Organization's ability to continue to
| function could be severely impacted.
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NOTE D - COMPENSATED ABSENCES
| The Organization has no policy providing for compensated absences.
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I NOTE E-FAIR VALUES OF FINANCIAL INSTRUMENTS1-
The following methods and assumptions were used by the Organization in estimating its fair valuedisclosures for financial instruments:
Cash, cash equivalents, short-term unconditional promises to give, and notes payable: Thecarrying amounts reported in the statement of financial position approximate fair values becauseof the short maturities of those instruments.
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REPORT ON INTERNAL CONTROL OVER FINANCIALREPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMEDIN ACCORDANCE WITH GOVERNMENT A UDITING STANDARDS
Board of DirectorsCalcasieu Association for SocialEnrichment, Inc.
We have audited the financial statements of Calcasieu Association for Social Enrichment, Inc. (a nonprofitcorporation) as of and for the year ended June 30, 2007, and have issued our report thereon dated August16,2007. We conducted our audit in accordance with auditing standards generally accepted in the UnitedStates of America and the standards applicable to financial audits contained in Government AuditingStandards, issued by the Comptroller General of the United States.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Calcasieu Association for Social Enrichment, Inc.'sinternal control over financial reporting as a basis for designing our auditing procedures for the purpose ofexpressing our opinion on the financial statements, but not for the purpose of expressing an opinion on theeffectiveness of Calcasieu Association for Social Enrichment, Inc.'s internal control over financialreporting. Accordingly, we do not express an opinion on the effectiveness of the Organization's internalcontrol over financial reporting.
Our consideration of internal control over financial reporting was for the limited purpose described in thepreceding paragraph and would not necessarily identify all deficiencies in internal control over financialreporting that might be significant deficiencies or material weaknesses. However, as discussed below, weidentified certain deficiencies in internal control over financial reporting that we consider to be significantdeficiencies.
A control deficiency exists when the design or operation of a control does not allow management oremployees, in the normal course of performing their assigned functions, to prevent or detect misstatementson a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies,that adversely affects the organization's ability to initiate, authorize, record, process, or report financialdata reliably in accordance with generally accepted accounting principles, such that there is more than aremote likelihood that a misstatement of the organization's financial statements that is more thaninconsequential will not be prevented or detected by the organization's internal control. We consider thedeficiency described in the accompanying schedule of findings to be a significant deficiency in internalcontrol over financial reporting (2007-1).
A material weakness is a significant deficiency, or combination of significant deficiencies, that results inmore than a remote likelihood that a material misstatement of the financial statements will not be preventedor detected by the organization's internal control.
Our consideration of the internal control over financial reporting was for the limited purpose described inthe first paragraph of this section and would not necessarily identify all deficiencies in the internal controlthat might be significant deficiencies and, accordingly, would not necessarily disclose all significant
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deficiencies that are also considered to be material weaknesses. However, of the significant deficiencydescribed above, we consider item 2007-1 to be a material weakness.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Calcasieu Association for Social Enrichment,Inc.'s financial statements are free of material misstatement, we performed tests of its compliance withcertain provisions of laws, regulations, contracts and grant agreements, noncompliance with which couldhave a direct and material effect on the determination of financial statement amounts. However, providingan opinion on compliance with those provisions was not an objective of our audit and, accordingly, we donot express such an opinion. The results of our tests disclosed no instances of noncompliance that are
,! required to be reported under Government Auditing Standards.iCalcasieu Association for Social Enrichment Inc.'s response to the finding identified in our audit isdescribed in the accompanying management corrective action plan. We did not audit Calcasieu Associationfor Social Enrichment Inc.'s response and, accordingly, we express no opinion on it.
This report is intended solely for the information and use of the board of directors, management, and theLegislative Auditor and is not intended to be and should not be used by anyone other than these specifiedparties.
McMullen and Mancuso, CPAs, LLC
August 16, 2007
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Calcasieu Association For Social Enrichment, Inc.
SCHEDULE OF FINDINGS
Year Ended June 30,2007
We have audited the financial statements of The Calcasieu Association for Social Enrichment, Inc. as ofand for the year ended June 30, 2007, and have issued our report thereon dated August 16, 2007. Weconducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards,issued by the Comptroller General of the United States. Our audit of the financial statements as of June 30,2007 resulted in an unqualified opinion.
Section I Summary of Auditor's Reports
a. Report on Internal Control and Compliance Material to the Financial Statements
Internal ControlMaterial Weaknesses | X | Yes [ ] No Other Conditions | | Yes | X ] No
Compliance
Compliance Material to Financial Statements | | Yes | X | No
Section II Financial Statement Findings
2007-1 We consider die following matter to be a material weakness. The Organization has only oneemployee who is responsible for all accounting and reporting functions. The size of theOrganization's accounting staff precludes certain internal controls that would be preferred if theoffice staff were large enough to provide optimum segregation of duties. This situation dictatesthat the Board of Directors remain involved in the financial affairs of the Organization to provideoversight and independent review functions.
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Calcasieu Association For Social Enrichment, Inc.
SCHEDULE OF PRIOR YEAR FINDINGS
Year Ended June 30,2007
SECHONI - INTERNAL CONTROL AND COMPLIANCE MATERIAL TO THE FINANCIAL
STATEMENTS
2005-1 The Organization has only one employeewho is responsible for all accountingand reporting functions. Therefore, it isnot possible to have segregation ofduties consistent with appropriate
internal control objectives over allphases of accounting.
Unresolved.See current year finding 2007-1.
THIS SCHEDULE HAS BEEN PREPARED BY MANAGEMENT
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Calcasieu Association For Social Enrichment, Inc.
MANAGEMENT'S CORRECTIVE ACTION PLAN
Year Ended June 30,2007
SECTION I - INTERNAL CONTROL AND COMPLIANCE MATERIAL TO THE
FINANCIAL STATEMENTS
2007-1 The Organization has only one emplojee
who is responsible for aH accounting
and reporting functions. Therefore, it is
not possible to have segregation of
duties consistent with appropriate
internal control objectives over all
phases of accounting.
Management is aware of the internal control
problem and the Board takes an active
oversight of financial matters to nitigate the
cortrol weaknesses. However, due to the small
size of the Organization it is not possible to ha\e
appropriate segregation of duties
THIS SCHEDULE HAS BEEN PREPARED BY MANAGEMENT
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