NATIONAL WILD TURKEY FEDERATION, INC. AND AFFILIATES · 8/31/2014 · national wild turkey...
Transcript of NATIONAL WILD TURKEY FEDERATION, INC. AND AFFILIATES · 8/31/2014 · national wild turkey...
NATIONAL WILD TURKEY FEDERATION, INC. AND AFFILIATES
COMBINED FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
As of and for the Years Ended August 31, 2014 and 2013 And Report of Independent Auditor
NATIONAL WILD TURKEY FEDERATION, INC. TABLE OF CONTENTS
REPORT OF INDEPENDENT AUDITOR ................................................................................................. 1-2
FINANCIAL STATEMENTS Combined Statements of Financial Position ..................................................................................................... 3 Combined Statements of Activities and Changes in Net Assets ...................................................................... 4 Combined Statements of Cash Flows .............................................................................................................. 5 Notes to Combined Financial Statements ................................................................................................... 6-14
SUPPLEMENTAL INFORMATION Schedule 1 - Combining Statement of Financial Position............................................................................... 15 Schedule 2 - Combining Statement of Activities and Changes in Net Assets ................................................ 16 Report on Internal Control Over Financial Reporting and on Compliance and Other
Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ............................................................................................................ 17-18
Independent Auditor’s Report on Compliance With Requirements That Could Have a Direct and Material Effect on Each Major Program and on Internal Control Over Compliance in Accordance with OMB Circular A-133 ........................................................................... 19-20
Schedule of Expenditures of Federal Awards ........................................................................................... 21-22 Notes to the Schedule of Expenditures of Federal Awards ............................................................................ 23 Schedule of Findings and Questioned Costs ................................................................................................. 24
Report of Independent Auditor The Board of Directors National Wild Turkey Federation, Inc. Edgefield, South Carolina Report on the Financial Statements We have audited the accompanying combined financial statements of National Wild Turkey Federation, Inc. (a nonprofit organization) (the “Federation”), which comprise the combined statements of financial position as of August 31, 2014 and 2013, and the related combined statements of activities and changes in net assets and cash flows for the years then ended, and the related notes to the combined financial statements. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these combined financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of combined 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 combined financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America 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 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 combined financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the combined financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the combined financial statements. We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the combined financial statements referred to above present fairly, in all material respects, the financial position of National Wild Turkey Federation, Inc. as of August 31, 2014 and 2013, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.
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Other Matters – Supplementary information Our audit was conducted for the purpose of forming an opinion on the combined financial statements as a whole. The combining statement of financial position and combining statement of activities and changes in net assets on pages 15 and 16, respectively, are presented for purposes of additional analysis and are not a required part of the combined 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 combined financial statements. The information has been subjected to the auditing procedures applied in the audit of the combined financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the combined financial statements or to the combined financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the combined financial statements as a whole. The accompanying schedule of expenditures of federal awards, as required by Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, on pages 21 and 22 is presented for purposes of additional analysis and is not a required part of the combined 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 combined financial statements. The information has been subjected to the auditing procedures applied in the audit of the combined financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the combined financial statements or to the combined financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the combined financial statements as a whole. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 15, 2014, on our consideration of the Federation’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Federation’s internal control over financial reporting and compliance.
Augusta, Georgia October 15, 2014
NATIONAL WILD TURKEY FEDERATION, INC. COMBINED STATEMENTS OF FINANCIAL POSITION AUGUST 31, 2014 AND 2013
The accompanying notes to the combined financial statements are an integral part of these statements. 3
2014 2013
ASSETS
Current Assets:
Cash and cash equivalents 8,317,619$ 17,104,450$
Investments - U.S. Treaury bills 5,000,211 -
Accounts receivable, net 3,028,290 2,861,484
Employee receivable 99,949 -
Prepaid expenses 514,481 722,237
Inventories 3,404,185 1,910,366
Total Current Assets 20,364,735 22,598,537
Land, Building, and Equipment, net of accumulated depreciation 10,760,613 8,605,403
Total Assets 31,125,348$ 31,203,940$
LIABILITIES AND NET ASSETS
Current Liabilities:
Accounts payable 1,348,666$ 1,855,855$
Accrued expenses 1,320,879 1,442,807
Deferred revenues 3,009,434 3,995,475
Note payable, current portion 75,000 -
Total Current Liabilities 5,753,979 7,294,137
Note payable, noncurrent portion 375,000 -
Total Liabilities 6,128,979 7,294,137
Unrestricted 18,699,811 17,891,389
Temporarily restricted 6,296,558 6,018,414
Total Net Assets 24,996,369 23,909,803
Total Liabilities and Net Assets 31,125,348$ 31,203,940$
NATIONAL WILD TURKEY FEDERATION, INC. COMBINED STATEMENTS OF ACTIVITIES AND CHANGES IN NET ASSETS YEARS ENDED AUGUST 31, 2014 AND 2013
The accompanying notes to the combined financial statements are an integral part of these statements. 4
2014 2013
Changes in unrestricted net assets
Support and Revenue:
Membership dues 10,937,319$ 11,712,914$
Contributions 1,952,011 869,321
Advertising income 1,248,958 1,120,909
Program services 35,514,627 38,023,605
Total Support and Revenue 49,652,915 51,726,749
Net assets released from restrictions 4,104,311 3,766,511
53,757,226 55,493,260
Expenses:
Administration 5,924,707 5,263,148
Education 3,384,699 3,417,694
Membership activities 3,780,028 3,393,721
Conservation activities 14,999,448 14,323,025
Program services 24,859,922 27,683,220
Total Expenses 52,948,804 54,080,808
Change in unrestricted net assets 808,422 1,412,452
Changes in temporarily restricted net assets
Super fund contributions 4,380,443 4,033,235
Other contributions - 100,000
Interest income 2,012 2,612
Net assets released from restrictions (4,104,311) (3,766,511)
Change in temporarily restricted net assets 278,144 369,336
Change in net assets 1,086,566 1,781,788
Net assets, beginning of year 23,909,803 22,128,015
Net assets, end of year 24,996,369$ 23,909,803$
NATIONAL WILD TURKEY FEDERATION, INC. COMBINED STATEMENTS OF CASH FLOWS YEARS ENDED AUGUST 31, 2014 AND 2013
The accompanying notes to the combined financial statements are an integral part of these statements. 5
2014 2013
Cash flows from operating activities:
Increase in net assets 1,086,566$ 1,781,788$
Adjustments to reconcile change in net assets
provided by operating activities:
Depreciation 1,448,973 1,481,147
Gain on sale of equipment (245,498) -
Change in deferred and accrued amounts:
Accounts receivable (166,806) 259,395
Prepaid expenses 207,756 11,354
Inventories (1,493,819) (88,230)
Accounts payable (507,189) (183,821)
Accrued expenses (121,928) 855,883
Deferred revenues (986,041) 90,010
Net cash from operating activities (777,986) 4,207,526
Cash flows from investing activities:
Purchase of land, building, and equipment (3,295,586) (653,385)
Proceeds from sale of equipment 286,952 -
Purchase of investments - U.S. Treasury bills (5,000,211) -
Net cash from investing activities (8,008,845) (653,385)
Cash flows from financing activities:
Borrowings under line of credit 5,981,594 5,644,001
Repayment of line of credit (5,981,594) (5,644,001)
Net cash from financing activities - -
Net change in cash and cash equivalents (8,786,831) 3,554,141
Cash and cash equivalents, beginning of year 17,104,450 13,550,309
Cash and cash equivalents, end of year 8,317,619$ 17,104,450$
Supplemental cash flow information:
Cash paid for interest 28,188$ 12,061$
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 1—Summary of significant accounting policies Nature of Operations – National Wild Turkey Federation (the “Federation”) is a nonprofit organization that promotes public awareness of, and support for, the conservation and wise management of the American wild turkeys, and the preservation of the turkey hunting tradition. The Federation has established chapters in cities across the United States of America. These chapters support the Federation and benefit from the overall success of their programs. The Federation operates in all states and in several foreign countries. Financial Statements – The accompanying combined financial statements include the combined accounts of the National Wild Turkey Federation, Inc., the National Wild Turkey Federation, Inc. Canada (“Canada”), the National Wild Turkey Federation, Inc. Mexico (“Mexico”), the National Wild Turkey Federation Endowment Foundation, Inc. (“Endowment”), and the NWTF Foundation, Inc. (“Foundation”). As of and for the years ended August 31, 2014 and 2013, there was no activity for National Wild Turkey Federation, Inc. Mexico. The financial statements of the five entities have been combined in accordance with accounting principles generally accepted in the United States of America and all intercompany accounts have been eliminated. Accounting Principles – The Federation follows accounting principles generally accepted in the United States of America on accounting for contributions and financial statements of not-for-profit organizations, which require reporting revenue and net assets by class of permanently restricted, temporarily restricted, and unrestricted. Temporarily Restricted – Net assets resulting from contributions restricted by outside sources are reported as temporarily restricted and are distinguished from unrestricted net assets allocated to specific purposes by action of the governing board. Externally restricted net assets may only be utilized in accordance with the purposes established by the source of net assets and are in contrast with unrestricted net assets over which the governing board retains full control for use in achieving any of its institutional purposes. Cash and Cash Equivalents – For purposes of reporting cash flows, the Federation considers all demand deposits and all liquid non-equity investments with a maturity of three months or less to be cash equivalents. Cash includes donor-restricted cash related to the Endowment and the Foundation of $919,814 and $933,110 at August 31, 2014 and 2013, respectively, as well donor-restricted cash related to sale of Utah conservation permits of $112,330 and $63,055, at August 31, 2014 and 2013, respectively. The State of Utah Department of Natural Resources requires proceeds from the sale of conservation permits to be kept in a separate bank account. The Federation is in compliance with this requirement as of August 31, 2014. Investments – Investments consist of deposit programs and U.S. Treasury bills. Investments are accounted for at fair market value in the accompanying financial statements. There were no realized or unrealized gains or losses during the years ended August 31, 2014 and 2013. Accounts Receivable – Receivables are carried at invoice amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a periodic basis. Management determines the allowance for doubtful accounts and banquet losses by regularly evaluating individual customer and chapter receivables and considering a customer’s or chapter’s financial condition, credit history, and current economic conditions. Receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when received. Inventories – Inventories consist of firearms and are stated at the lower of cost (first-in, first-out basis) or market (net realizable value).
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 1—Summary of significant accounting policies (continued) Land, Building, and Equipment – Land, building, and equipment are stated at cost except for donated property, which is stated at fair market value at the date of the donation. Additions with a cost or fair value of less than $1,000 and an estimated life of less than three years are expensed as incurred. Depreciation is provided over the estimated useful lives of the assets, and computed using the straight-line method. Costs of Borrowing – Interest costs on borrowed funds during the period of construction of capital assets are capitalized as a component of the cost of acquiring those assets. No interest was capitalized in 2014 or 2013. Recognition of Donor Restrictions – Support that is restricted by the donor is reported as an increase in temporarily or permanently restricted net assets depending on the nature of the restriction. When a restriction expires, temporarily restricted net assets are reclassified to unrestricted net assets. Revenue Recognition and Deferred Revenue – Revenue consist primarily of dues paid by members and proceeds from member banquets that are held by chapters. The Federation’s policy is to recognize membership revenue when the member joins and pays its membership dues. The Federation’s policy is to recognize banquet proceeds as revenue when earned and collectability reasonably assured, which occurs when the banquet is finalized at the national headquarters. Revenue related to banquet proceeds is deferred until finalization of the banquet occurs. Advertising – Advertising costs are expensed as incurred. Shipping and Handling Costs – Freight billed to chapters and customers for banquet merchandise and firearms is considered program service revenue and the related freight costs as a program services expense. Concentration of Credit Risk – The Federation places its cash and cash equivalents on deposit with financial institutions in the United States and Canada. The Federal Deposit Insurance Corporation (“FDIC”) covers $250,000 for substantially all depository accounts. The Canada Deposit Insurance Corporation (“CDIC”) covers $100,000 for certain depository accounts. The Federation from time to time may have amounts on deposit in excess of the insured limits. The Federation had $8,156,374 and $15,379,648 which exceed these insured amounts as of August 31, 2014 and 2013, respectively. Donated Goods and Services – Donated materials and equipment are reflected as contributions at their fair market value at date of receipt. Use of Estimates – The preparation of the combined 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 combined financial statements and the reported amounts or revenues and expenses during the reporting period. Actual results could differ from those estimates. Conservation Easements – Conservation easements represent rights to restrict the use, access, and development of certain properties. The Federation is obligated to monitor easements to ensure that the restrictions are maintained. The Federation monitors these easements in the normal course of its operations and associated cost are expensed as incurred. The property owners contribute funds to help with the monitoring cost and these contributions are held in the Endowment as temporarily restricted net assets. The estimated value of easements is not included in the combined statements of financial position because the easements do not represent a future economic benefit to the Federation.
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 1—Summary of significant accounting policies (continued) Income Tax Status – The Federation is exempt from income taxes under Internal Revenue Code Section 501(c)(3) and the applicable state statutes. Management has evaluated the effect of the guidance provided by U S Generally Accepted Accounting Principles on Accounting for Uncertainty in Income Taxes. Management believes that the Federation continues to satisfy the requirements of a tax-exempt organization at August 31, 2014. Management has evaluated all other tax positions that could have a significant effect on the combined financial statements and determined the Federation had no uncertain income tax positions at August 31, 2014. The Federation’s Return of Organization Exempt from Income Tax (Form 990) and it’s Exempt Organization Business Income Tax Return (Form 990T) for 2010, 2011, and 2012 are subject to examination by the IRS, generally for three years after they were filed. Note 2—Investments At August 31, 2014, the carrying value of the Federation’s investments was $5,000,211, which is materially the same as fair value. There were no investments as of August 31, 2013. At August 31, 2014 and 2013, investments are comprised of the following:
2014 2013
Cash, deposits 50,396$ -$ Government debt securities 4,949,815 -
5,000,211$ -$
Note 3—Fair value measurements of assets and liabilities The Federation follows the provisions of FASB ASC 820, Fair Value Measurements, for financial assets and liabilities measured at fair value. This statement requires fair value measurements be classified and disclosed in one of the following three categories (“Fair Value Hierarchy”):
Level 1: Financial instruments with unadjusted, quoted prices listed on active market exchanges. Level 2: Financial instruments valued using inputs that include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3: Financial instruments that are not actively traded on a market exchange and require using significant unobservable inputs in determining fair value.
The tables on the following page summarizes the valuation of the Federation’s financial assets measured at fair value on a recurring basis as of August 31, 2014, based on the level of input utilized to measure fair value:
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 3—Fair value measurements of assets and liabilities (continued)
Level 1 Level 2 Level 3 TotalDescriptionInvestments:Fixed income:
Government bonds -$ 4,949,815$ -$ 4,949,815$ Total fixed income
Deposit programs 50,396 - - 50,396
Total investments - recurring basis 50,396$ 4,949,815$ -$ 5,000,211$
Fair Value Measurement at August 31, 2014
There were no assets or liabilities measured at fair value on a recurring basis as of August 31, 2013. Note 4—Accounts receivable Accounts receivable consist of the following:
2014 2013
Advertising 143,098$ 151,444$ Banquets 2,039,666 2,040,193 Other 1,285,182 1,099,613 Less: allowance for banquet losses and doubtful accounts (439,656) (429,766)
3,028,290$ 2,861,484$
Note 5—Land, buildings, and equipment Land, buildings, and equipment consist of the following:
2014 2013 Useful Lives
Land 3,196,188$ 924,753$ Buildings 10,744,663 10,621,048 8 - 31 yearsFurniture 697,900 697,900 5 - 10 yearsEquipment 5,648,292 4,793,273 5 - 10 yearsVehicles 1,935,705 2,994,342 5 yearsConstruction in Progress 381,215 24,865
22,603,963 20,056,181 Less accumulated depreciation (11,843,350) (11,450,778)
10,760,613$ 8,605,403$
Depreciation expense was $1,448,973 and $1,481,147 for the years ended August 31, 2014 and 2013, respectively.
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 6—Line of credit and long‐term debt The Federation has a line of credit with a local bank, which expires in April 2015 and provides for seasonal borrowing needs, up to the following maximum amounts:
Amount
$8,000,000 January 1 - April 15$4,000,000 April 16 - December 31
Time Frame
The borrowing rate on the line of credit is a variable rate of interest based on LIBOR, not to exceed LIBOR plus 1.5%, with a floor rate of 3.75%. The line of credit is secured by the assets of the Federation. There were no outstanding borrowings under the line of credit at August 31, 2014 and 2013. Long-term debt at August 31, 2014 and 2013 consists of the following:
2014 2013
450,000$ -$
Less current maturities (75,000) -
Long-term debt, net of currentmaturities 375,000$ -$
Loan in the original amount of $450,000 for the primarypurpose of purchasing real estate payable in annualinstallments, including interest at a fixed rate of 3.5% perannum, maturing in October 2019, collateralized by the267 acres of land
Scheduled principal and interest payments on long-term debt for years subsequent to August 31, 2014 are as follows:
Year EndingAugust 31, Principal Interest
2015 75,000$ 15,750$ 2016 75,000 13,125 2017 75,000 10,500 2018 75,000 7,875 2019 75,000 5,250 2020 75,000 2,625
450,000$ 55,125$
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 7—Retirement plan The Federation has a 401(k) and profit sharing plan covering all employees who have reached the age of twenty-one (21) and completed six months of service. Employees may contribute an amount not to exceed 75% of their compensation into the plan. The Federation may make profit sharing contributions at its discretion based on an integrated allocation formula calculated as a percentage of each eligible active participant’s compensation. Eligibility for the discretionary contribution requires the participant to be employed by the Federation on the last day of the plan year and to have worked at least 1,000 hours during the plan year. The Federation’s expense related to the plan was $549,792 and $760,726 for the years ended August 31, 2014 and 2013, respectively. Note 8—Temporarily restricted net assets Temporarily restricted net assets are available for the following as of August 31, 2014 and 2013, respectively:
2014 2013
National Wild Turkey Endowment Foundation, Inc. 360,723$ 360,339$ NWTF Foundation, Inc. 534,133 536,154 Funds held for State Superfund 5,401,702 5,121,921
6,296,558$ 6,018,414$
The Federation is affiliated with local chapters that have fund raising banquets. These banquets provide funds for conservation activities. A portion of the banquet proceeds are used for “Super Fund” conservation projects within the state hosting the banquet. Note 9—Fund‐raising expense Total fund-raising expense for the years ended August 31, 2014 and 2013, was approximately $569,000 and $443,000, respectively. The total fund-raising expense is allocated to the appropriate function in the combined statements of activities. Note 10—Commitments and contingencies Operating Leases – The Federation leases buildings for storage under an operating lease. The term of the lease require monthly payments of $3,134 and expires in May 2016. Total lease expense was $37,611 and $37,611 for 2013 and 2012, respectively. The Federation also leases a retail space. The term of the lease is month to month and requires monthly payments of $2,000. Total lease expense was $24,000 and $24,000 for 2014 and 2013, respectively. Contingencies – The Federation is currently a defendant in a lawsuit filed by two former employees which is being defended by the Federation’s insurance carrier. The Federation intends to vigorously contest these allegations, which appear to lack merit according to the insurance carrier’s legal counsel. Management and the legal counsel are unable to accurately estimate the likelihood or range of potential loss due to the case being in the early stages of discovery. However, the Federation has adequate insurance coverage to cover potential losses associated with these cases. In November 2013, the Federation settled a lawsuit that was defended by the Federation’s insurance carrier, and its obligation was covered by the carrier. There was no loss to the Federation.
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 11—Donor‐restricted endowments The Federation’s endowment consists of one fund established for a variety of purposes. This endowment includes funds contributed to the Federation for the long-term benefit of the future of the Federation. As required by accounting principles generally accepted in the United State of America, net assets associated with endowment funds, including funds designated by the Board of Directors to function as endowments, are classified and reported based on the existence or absence of donor-imposed restrictions. The Board of Directors of the Federation has interpreted the State Prudent Management of Institutional Funds Act (“SPMIFA”) as requiring the preservation of the fair value of the original gift as of the gift date of the donor-restricted endowment funds absent explicit donor stipulations to the contrary. As a result of this interpretation, the Federation classifies as permanently restricted net assets (a) the original value of gifts donated to the permanent endowment, (b) the original value of subsequent gifts to the permanent endowment, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. The remaining portion of the donor-restricted endowment fund that is not classified in permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the Federation in a manner consistent with the standard of prudence prescribed by SPMIFA. In accordance with SPMIFA, the Federation considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds: (1) the duration and preservation of the various funds, (2) the purposes of the donor-restricted endowment funds, (3) general economic conditions, (4) the possible effect of inflation and deflation, (5) the expected total return from income and the appreciation of investments, (6) other resources of the Federation, and (7) the Federation’s investment policies. Investment Return Objectives, Risk Parameters, and Strategies – The Federation has adopted investment and spending policies, approved by the Board of Directors, for endowment assets that attempts to maximize total return consistent with an acceptable level of risk. Accordingly, the investment process seeks to achieve an after-cost total real rate of return, including investment income as well as capital appreciation. Investment risk is measured in terms of the total endowment fund; investment assets and allocation between asset classes and strategies are managed to not expose the fund to unacceptable levels of risk.
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 11—Donor‐restricted endowments (continued) Spending Policy – The Federation’s spending policy is not to spend the funds unless needed to defend the development of land. The Federation expects the current spending policy to allow its endowment funds to grow at a nominal rate, which is consistent with the Federation’s objective to maintain the purchasing power of the endowment assets. Endowment net asset composition by type of fund as of August 31, 2014, is as follows:
Total Net
Temporarily Permanently Endowment
Unrestricted Restricted Restricted Assets
Donor-restricted endowment funds -$ 894,856$ -$ 894,856$
-$ 894,856$ -$ 894,856$
Endowment net asset composition by type of fund as of August 31, 2013, is as follows:
Total Net
Temporarily Permanently Endowment
Unrestricted Restricted Restricted Assets
Donor-restricted endowment funds -$ 896,493$ -$ 896,493$
-$ 896,493$ -$ 896,493$
Endowment net assets are included in cash and cash equivalents in the combined statements of financial position at August 31, 2014 and 2013. Changes in endowment net assets during the year ended August 31, 2014, are as follows:
Total Net
Temporarily Permanently Endowment
Unrestricted Restricted Restricted Assets
Endowment net assets, beginning -$ 896,493$ -$ 896,493$ Contributions - - - - Investment income - 2,012 - 2,012 Net assets released from restriction - (3,649) - (3,649)
Endowment net assets, ending -$ 894,856$ -$ 894,856$
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE COMBINED FINANCIAL STATEMENTS AUGUST 31, 2014 AND 2013
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Note 11—Donor‐restricted endowments (continued) Changes in endowment net assets during the year ended August 31, 2013, are as follows:
Total Net
Temporarily Permanently Endowment
Unrestricted Restricted Restricted Assets
Endowment net assets, beginning -$ 798,161$ -$ 798,161$ Contributions - 100,000 - 100,000 Investment income - 2,612 - 2,612 Net assets released from restriction - (4,280) - (4,280)
Endowment net assets, ending -$ 896,493$ -$ 896,493$
Note 12—Noncash transactions During the year ended August 31, 2014, the Federation had noncash financing transactions relating to truck sales to employees on payment plans in the amount of $99,949. The Federation also had a noncash financing transaction related to the purchase of land on a note payable for $450,000. Note 13—Subsequent events The Federation has evaluated subsequent events through October 15, 2014, which was the date the combined financial statements were available to be issued. There were no material subsequent events required adjustment to or disclosure in the combined financial statements for the year ended August 31, 2013.
SUPPLEMENTAL SCHEDULES
NATIONAL WILD TURKEY FEDERATION, INC. COMBINING STATEMENT OF FINANCIAL POSITION AUGUST 31, 2014
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NWTF Canada Endowment Foundation Total
ASSETS
Current Assets:
Cash and cash equivalents 7,397,805$ -$ 385,323$ 534,491$ 8,317,619$
Investments - U.S. Treasury bills 5,000,211 - - - 5,000,211
Accounts receivable, net 3,028,290 - - - 3,028,290
Employee receivable 99,949 - - - 99,949
Prepaid expenses 514,481 - - - 514,481
Inventories 3,404,185 - - - 3,404,185
Total Current Assets 19,444,921 - 385,323 534,491 20,364,735
Land, Building, and Equipment,
net of accumulated depreciation 10,760,613 - - - 10,760,613
Total Assets 30,205,534$ -$ 385,323$ 534,491$ 31,125,348$
LIABILITIES AND NET ASSETS
Current Liabilities:
Accounts payable 1,348,308$ -$ -$ 358$ 1,348,666$
Accrued expenses 1,296,279 - 24,600 - 1,320,879
Deferred revenues 3,009,434 - - - 3,009,434
Note Payable 75,000 - - - 75,000
Total Current Liabilities 5,729,021 - 24,600 358 5,753,979
Long-term Liabilities:
Note Payable 375,000 - - - 375,000
Total Liabilities 6,104,021 - 24,600 358 6,128,979
Net Assets:
Unrestricted 18,699,811 - - - 18,699,811
Temporarily restricted 5,401,702 - 360,723 534,133 6,296,558
Total Net Assets 24,101,513 - 360,723 534,133 24,996,369
Total Liabilities and Net Assets 30,205,534$ -$ 385,323$ 534,491$ 31,125,348$
NATIONAL WILD TURKEY FEDERATION, INC. COMBINING STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS YEAR ENDED AUGUST 31, 2014
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NWTF Canada Endowment Foundation Total
Changes in unrestricted net assets
Support and Revenue:
Membership dues 10,937,319$ -$ -$ -$ 10,937,319$
Contributions 1,952,011 - - - 1,952,011
Advertising income 1,248,958 - - - 1,248,958
Program services 35,514,627 - - - 35,514,627
Total unrestricted support
and revenue 49,652,915 - - - 49,652,915
Net assets released from
restrictions 3,981,533 119,129 - 3,649 4,104,311
53,634,448 119,129 - 3,649 53,757,226
Expenses
Administration 5,921,058 - - 3,649 5,924,707
Education 3,384,699 - - - 3,384,699
Membership activities 3,780,028 - - - 3,780,028
Conservation activities 14,880,319 119,129 - - 14,999,448
Program services 24,859,922 - - - 24,859,922
Total expenses 52,826,026 119,129 - 3,649 52,948,804
Change in unrestricted
net assets 808,422 - - - 808,422
Changes in temporarily
restricted net assets
Super fund contributions 4,366,267 14,176 - - 4,380,443
Other contributions - - - - -
Interest income - - 384 1,628 2,012
Net assets released from
restrictions (3,981,533) (119,129) - (3,649) (4,104,311)
Change in temporarily
restricted net assets 384,734 (104,953) 384 (2,021) 278,144
Increase (decrease) in net assets 1,193,156 (104,953) 384 (2,021) 1,086,566
Net assets, beginning of year 22,908,357 104,953 360,339 536,154 23,909,803
Net assets, end of year $ 24,101,513 $ - $ 360,723 $ 534,133 $ 24,996,369
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Report of Independent Auditor on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with
Government Auditing Standards The Board of Directors National Wild Turkey Federation, Inc. Edgefield, South Carolina We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller of the United States, the combined financial statements of National Wild Turkey Federation, Inc. (the “Federation”, a nonprofit organization), which comprise the combined statements of financial position as of August 31, 2014 and 2013, and the related combined statements of activities and changes in net assets and cash flows for the years then ended, and the related notes to the combined financial statements, and have issued our report thereon dated October 15, 2014. Internal Control over Financial Reporting In planning and performing our audit of the combined financial statements, we considered the Federation’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the combined financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Federation’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Federation’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Federation’s combined financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
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Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Augusta, Georgia October 15, 2014
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Report of Independent Auditor on Compliance with Requirements That Could Have a Direct and Material Effect on Each Major Program and on Internal Control
Over Compliance in Accordance With OMB Circular A‐133 The Board of Directors National Wild Turkey Federation, Inc. Edgefield, South Carolina Report on Compliance for Each Major Federal Program We have audited National Wild Turkey Federation, Inc.'s (the “Federation”) compliance with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement that could have a direct and material effect on each of the Federation's major federal programs for the year ended August 31, 2014. The Federation's major federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs.
Management’s Responsibility Management is responsible for compliance with the requirements of laws, regulations, contracts, and grants applicable to its federal programs.
Auditor’s Responsibility Our responsibility is to express an opinion on compliance for each of the Federation’s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the Federation’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the Federation’s compliance.
Opinion on Each Major Federal Program In our opinion, the Federation complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended August 31, 2014.
Report on Internal Control Over Compliance Management of the Federation is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the Federation’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with OMB Circular A-133, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the Federation’s internal control over compliance.
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A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of OMB Circular A-133. Accordingly, this report is not suitable for any other purpose.
Augusta, Georgia October 15, 2014
NATIONAL WILD TURKEY FEDERATION, INC. SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED AUGUST 31, 2014
See notes to schedule of expenditures of federal awards. 21
Federal
CFDA Pass‐through Entity FY 2014
Grantor/Pass‐through Grantor/Program or Cluster Title Number Identifying Number Expenses
United States Department of AgricultureCollaborative Forest Restoration
Direct from USDA Forest Service 10.679 231,236$
National Forest Foundation
Direct from National Forest Foundation 10.682 13,695 Pass-through from National Forest Foundation:
Bearcat Hollow III 10.682 XE-801 13,752
Total CFDA #10.682 27,447
National Fish and Wildlife Foundation
Pass-through from National Fish & Wildlife Foundation:
Oak Woodland & Savannah Restoration 10.683 2010-0065-002 5,258
Soil and Water Conservation
Direct from USDA Natural Resources Conservation Services 10.902 244,571
Environmental Quality Incentives Program
Direct from USDA Natural Resources Conservation Services 10.912 1,706
Wildlife Habitat Incentive Program
Direct from USDA Natural Resources Conservation Services 10.914 803,922
Department of Agriculture Other Financial Assistance
Direct from USDA Natural Resources Conservation Services 10.OFA 41,528 Pass-through from State of Illinois Dept. of Natural Resources:
Monogahela National Forest 10.OFA 13-CS-11092100-012 5,739
Total CFDA #10.OFA 47,267
ARRA - Emergency Watershed Protection Program
Direct from USDA Natural Resources Conservation Services 10.923 14,070
1,375,477
Awards made under the American Recovery and Reinvestment Act
Total U.S. Department of Agriculture
NATIONAL WILD TURKEY FEDERATION, INC. SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED AUGUST 31, 2014
See notes to schedule of expenditures of federal awards. 22
Federal
CFDA Pass‐through Entity FY 2014
Grantor/Pass‐through Grantor/Program or Cluster Title Number Identifying Number Expenses
United States Department of the Interior
Fish, Wildlife and Plant Conservation Resource Management
Direct from Bureau of Land Management 15.231 L13AC00117 19,770
Fish and Wildlife Management Assistance
Pass-through from National Fish & Wildlife Foundation:
Golden-winged Warbler Habitat Enhancement 15.608 2010-0054-001 5,451 Longleaf Pine Restoration Partnership 15.608 2009-0011-001 151,481 Seneca & Cayuga Watersheds 15.608 F12AC01520 2,193
Total CFDA #15.608 159,125
Fish and Wildlife Cluster
Wildlife Restoration and Basic Hunter Education
Pass-through from State of Nebraska Game & Parks Commission:
NE Game & Parks Commission 15.611 SC-002 57,620
Multistate Conservation Grant Program
Pass-through from Wildlife Restoration Fund:
LongitudinalEvaluation of Hunting, Fishing, and Shooting Recruitment/Retention Program 15.628 F12AP00152 115,449
Partners for Fish and Wildlife
Direct from USDOI Fish & Wildlife Service 15.631 230,457
National Fish and Wildlife Foundation
Direct from U.S. Fish and Wildlife Service 15.663 120,376
Abandoned Mine Hazard Mitigation
Direct from USDOI Bureau of Land Management 15.934 68,569
Department of Interior Other Financial Assistance
Pass-through from Illinois Dept. of Natural Resources:
WMI Conservation Partners 15.OFA 14,800 OH NRCS - Forest Stand GIS 15.OFA 58,665 Illinois & Kaskaskia River Basins 15.OFA T-69-D-1 14,866
Total CFDA #15.OFA 88,331
859,697
Total Federal Expenditures 2,235,174$
Total U.S. Department of Interior
NATIONAL WILD TURKEY FEDERATION, INC. NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED AUGUST 31, 2014
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Note 1 – Basis of presentation The accompanying schedule of expenditures of federal awards includes the federal grant activity of the National Wild Turkey Federation, Inc., (the “Federation”), and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the combined financial statements. Note 2 – Non‐cash awards The Federation did not receive any non-cash federal awards during the year ended August 31, 2014. Note 3 – Contingencies These award programs are subject to financial and compliance audits by grantor agencies. The amount, if any, of expenditures that may be disallowed by the grantor agencies cannot be determined at this time, although the Federation expects such amounts, if any, to be immaterial. Note 4 – Commingled funds Federal government agencies received funds from other federal agencies in addition to private funds. The federal agency then awards a combination of federal and private funds to the Federation. If the Federation is unable to determine the federal portion, the entire amount is reported on the Schedule of Expenditures of Federal Awards.
NATIONAL WILD TURKEY FEDERATION, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED AUGUST 31, 2014
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Summary of Auditor’s Results
Financial Statements Type of auditor’s report issued: Unmodified Internal control over financial reporting: Material weakness(es) identified? ____ yes X no Significant deficiency(ies) identified that are not
considered to be material weakness(es)? yes X none reported Noncompliance material to financial statements noted? ____ yes X no Federal Awards Internal control over major federal programs: Material weakness(es) identified? ____ yes X no Significant deficiency(ies) identified that are not
considered to be material weakness(es)? yes X none reported Type of auditor’s report issued on compliance for major programs: Unmodified Any audit findings disclosed that are required to be reported in accordance with Section 510(a) of Circular A-133 ____ yes X no Identification of Major Programs The programs tested as major programs of the National Wild Turkey Federation, Inc. included: CFDA # Name of Federal Program 10.914 Wildlife Habitat Incentive Program The dollar threshold used to distinguish between Type A and Type B programs was $300,000.
The National Wild Turkey Federation, Inc. qualified as a low-risk auditee.