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TABLE OF CONTENTS
Page
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS
Statement of Financial Position 2
Statement of Activities 3
Statement of Functional Expenses 4
Statement of Cash Flows 5
NOTES TO FINANCIAL STATEMENTS 6 - 12
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTINGAND ON COMPLIANCE AND OTHER MATTERS BASED ON ANAUDIT OF FINANCIAL STATEMENTS PERFORMED INACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 13 - 14
AFTER-SCHOOL ALL-STARS
STATEMENT OF FINANCIAL POSITION
JUNE 30, 2011
ASSETS
Current AssetsCash and cash equivalents $ 1,246,063Investments 488,307Contributions and grants receivable 410,770Contracts receivable 139,247Other receivables 25,011Prepaid expenses 41,261Due from affiliates 168,114
2,518,773
Office Equipment, net of accumulated depreciation of $82,257 24,238
Deposits 14,924
$ 2,557,935
LIABILITIES AND NET ASSETS
Current LiabilitiesAccounts payable and accrued expenses $ 297,400Deferred revenue 35,000
332,400
Commitments (Note 7)
Net AssetsUnrestricted 1,634,765Temporarily restricted 590,770
2,225,535
$ 2,557,935
See accompanying notes to financial statements.2
AFTER-SCHOOL ALL-STARS
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2011
UnrestrictedTemporarilyRestricted Total
Revenue, Gains and SupportContribution and grant revenue $ 1,767,635 $ 217,190 $ 1,984,825Contract revenue 508,692 - 508,692Proceeds from special events, net of
costs of direct benefit to donors of$109,736 575,360 - 575,360
Contributed program supplies andservices 158,388 - 158,388
BSU management fees from affiliates(Note 8) 28,700 - 28,700
Interest and dividends 12,626 - 12,626Unrealized losses on investments (5,507) - (5,507)
Net Assets Released from Restrictions 845,605 (845,605) -
3,891,499 (628,415) 3,263,084Functional Expenses
Program services 2,548,449 - 2,548,449Administration 434,907 - 434,907Fundraising 374,697 - 374,697
3,358,053 - 3,358,053
Changes in Net Assets 533,446 (628,415) (94,969)
Net Assets, beginning of year 1,101,319 1,219,185 2,320,504
Net Assets, end of year $ 1,634,765 $ 590,770 $ 2,225,535
See accompanying notes to financial statements.3
AFTER-SCHOOL ALL-STARS
STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED JUNE 30, 2011
ProgramServices Administration Fundraising Total
PersonnelSalaries $ 1,014,160 $ 179,107 $ 119,291 $ 1,312,558Payroll taxes 88,045 13,332 8,288 109,665Employee benefits 83,230 16,585 9,894 109,709
1,185,435 209,024 137,473 1,531,932
Bad debt - 14,261 - 14,261Business management fees - 51,136 - 51,136Chapter support and training 64,582 - - 64,582Communications 18,520 8,087 2,086 28,693Consulting 138,752 4,785 15,948 159,485Depreciation 14,081 1,392 - 15,473Donated special events goods and
services - - 134,620 134,620Grants to affiliates 681,457 - - 681,457Insurance 14,041 7,258 3,145 24,444Marketing 26,091 14,898 45,160 86,149Membership dues 1,472 135 - 1,607Professional fees 1,644 63,519 - 65,163Recruitment 12,117 2,294 - 14,411Rent 116,353 35,392 17,199 168,944Service and operating 19,996 14,643 4,279 38,918Supplies 25,654 3,237 3,801 32,692Travel 213,224 2,264 10,986 226,474Website and information technology 15,030 2,582 - 17,612
$ 2,548,449 $ 434,907 $ 374,697 $ 3,358,053
See accompanying notes to financial statements.4
AFTER-SCHOOL ALL-STARS
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2011
Cash Flows from Operating ActivitiesChanges in net assets $ (94,969)Adjustments to reconcile changes in net assets
to net cash provided by operating activitiesDepreciation 15,473Unrealized losses on investments 5,507(Increase) decrease in operating assets
Contributions and grants receivable 725,365Contracts receivable 60,341Other receivables 135,900Prepaid expenses (9,118)Due from affiliates (116,713)Deposits (2,000)
Increase (decrease) in operating liabilitiesAccounts payable and accrued expenses 136,216Deferred revenue 10,650
Net Cash Provided by Operating Activities 866,652
Cash Flows from Investing ActivitiesProceeds from sales of investments 100,000Purchases of office equipment (1,156)
Net Cash Provided by Investing Activities 98,844
Net Increase in Cash and Cash Equivalents 965,496
Cash and Cash Equivalents, beginning of year 280,567
Cash and Cash Equivalents, end of year $ 1,246,063
See accompanying notes to financial statements.5
AFTER-SCHOOL ALL-STARS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2011
NOTE 1 - NATURE OF OPERATIONS
After-School All-Stars (the "Organization"), incorporated under the laws of the state ofCalifornia in 1992, provides opportunities for inner-city youth to participate in sports,education, computer technology, cultural and community enrichment programs in orderto build confidence and self-esteem and to encourage youth to say "no" to gangs, drugsand violence and "yes" to hope, learning and life.
After-School All-Stars is decentralized; 12 city-based, local nonprofit organizations andthe Chicago Public Schools After-School Program license the use of the After-SchoolAll-Stars' name. The local organizations apply for grants and receive financial supportfrom the Organization and independently operate their after-school, summer and year-round programs for youth.
These financial statements include the National operations as well as the Hawaii chapter.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Income Tax Status
The Organization is a nonprofit public benefit corporation organized under the laws ofCalifornia and, as such, is exempt from federal and state income taxes under InternalRevenue Code ("IRC") Section 501(c)(3) and corresponding California provisions.
The Organization’s federal income tax information returns for the years ending June 30,2008, and subsequent remain open for examination by the Internal Revenue Service. Thereturns for California, the Organization’s most significant state tax jurisdiction, remainopen for examination by the California Franchise Tax Board for the years endingJune 30, 2007, and subsequent.
Financial Statement Presentation
The Organization reports information regarding its financial position and activitiesaccording to three classes of net assets: unrestricted net assets (general and board-designated), temporarily restricted net assets and permanently restricted net assets.
Unrestricted Net Assets - Include contributions, grants, fundraising events, and otherforms of unrestricted revenue and expenditures related to the general operations andfundraising efforts of the Organization.
6
AFTER-SCHOOL ALL-STARS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2011
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Financial Statement Presentation (Continued)
Temporarily Restricted Net Assets - Include contributions and grants received that aretemporarily restricted with respect to use by the donor or grantor or time-restricted to theextent they will be collected and expended in the future. When restrictions expire, thesenet assets are reclassified to unrestricted net assets. Restricted contributions whererestrictions are met in the same reporting period are classified as unrestricted. AtJune 30, 2011, temporarily restricted net assets consist of time-restricted and purpose-restricted contributions and grants receivable.
Permanently Restricted Net Assets - Include assets that have been restricted by the donorin perpetuity but permit the Organization to expend part or all of the income derivedfrom the contributed assets. The Organization has no permanently restricted net assets.
Use of Estimates
Management uses estimates and assumptions in preparing financial statements. Thoseestimates and assumptions affect the reported amounts of assets and liabilities, thedisclosure of contingent assets and liabilities, and the reported revenues and expenses.Actual results could differ from these estimates.
Cash and Cash Equivalents
The Organization considers financial instruments purchased with an original maturity ofthree months or less to be cash equivalents.
Concentrations of Credit Risk
The Organization maintains cash at financial institutions. The Organization's bankbalances occasionally exceed FDIC-insured limits. The Organization has notexperienced, and does not anticipate, any losses related to cash held in these accounts.
The Organization has one funding source which comprised 34% of total revenue and38% of total contributions and grants receivable at June 30, 2011. The Organizationanticipates continuing its relationship with this funding source.
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AFTER-SCHOOL ALL-STARS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2011
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Investments
Investments are stated at fair value. Realized gains and losses are calculated andrecognized using the first-in, first-out method. Realized and unrealized gains and lossesas well as interest and dividends on investments are reflected in the statement ofactivities as unrestricted unless such amounts are restricted by the donor or by law.
The Organization must report its investments at fair value among three categories ofprice inputs available. These categories of inputs are quoted prices in active markets foridentical assets (Level 1); significant other observable inputs (Level 2); and significantunobservable inputs (Level 3). At year-end, all investments were considered to beLevel 2 (see Note 3).
Contributions and Grants Receivable
Contributions and grants received are recorded as unrestricted, temporarily restricted, orpermanently restricted support depending on the existence and/or nature of any donorrestrictions. Conditional contributions and grants are recorded as support in the periodthe condition is met. Such contributions and grants are required to be reported astemporarily restricted support and are then reclassified to unrestricted net assets uponexpiration of the restriction, usually when the funds are spent. Pledges for futurecontributions and grants are recorded as receivables and reported at their estimated netrealizable values. Management anticipates all contributions and grants receivable will becollected within the next year; consequently, no contributions or grants have beendiscounted. Additionally, management has determined no allowance for potentiallyuncollectible contributions and grants receivable is necessary.
Contracts Receivable
Contracts receivable resulting primarily from contracts with school districts areanticipated to be fully collected within one year. Management has determined noallowance for doubtful accounts is necessary.
Other Receivables
Other receivables are anticipated to be fully collected within one year. Management hasdetermined no allowance for potentially uncollectible other receivables is necessary.
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AFTER-SCHOOL ALL-STARS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2011
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Office Equipment
Purchases of office equipment are recorded at cost. Donated items are recorded atestimated fair value when received. Depreciation both purchased and donated officeequipment are computed using the straight-line basis over the estimated useful lives,generally five years.
Normal repairs and maintenance are expensed as incurred, whereas significant chargeswhich materially increase values or extend useful lives are capitalized and depreciatedover the estimated useful lives of the related assets.
Impairment of Long-Lived Assets
Management reviews each asset or asset group for impairment whenever events orcircumstances indicate that the carrying value of an asset or asset group may not berecoverable, but at least annually. The review of recoverability is based onmanagement's estimate of the undiscounted future cash flows that are expected to resultfrom the asset's use and eventual disposition. These cash flows consider factors such asexpected future operating income, trends and prospects, as well as the effects ofcompetition and other factors. If an impairment event exists due to the projectedinability to recover the carrying value of an asset or asset group, an impairment loss isrecognized to the extent that the carrying value exceeds estimated fair value. Noimpairment provision was recorded by the Organization during the year.
Deferred Revenue
Cash collected in advance for a special event which occurred in August 2011 has beenreported as deferred revenue.
Functional Allocation of Expenses
The Organization allocates its expenses on a functional basis among its various programand support services. Expenses that can be identified with a specific program or supportservice are allocated directly according to their natural expense classification. Otherexpenses that are common to several functions are allocated accordingly.
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AFTER-SCHOOL ALL-STARS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2011
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Contributed Program Supplies and Services
Program supplies and services have been contributed to the Organization and arerecognized as contribution revenue and the following expenses at their fair value as ofthe contribution date.
Marketing $ 20,000Program supplies 3,768Donated special events goods and services 134,620
$ 158,388
Advertising services with an estimated fair value of $930,634 were contributed to theOrganization to promote a fundraising effort which raised $445,000. The amount of thecontributed advertising services has not been included in the financial statements as itdoes not meet the criteria to be recognized as in-kind revenue.
Subsequent Events
The Organization has evaluated events subsequent to June 30, 2011, to assess the needfor potential recognition or disclosure in the financial statements. Such events wereevaluated through March 7, 2012, the date the financial statements were available to beissued. Based upon this evaluation, it was determined that no subsequent eventsoccurred that require recognition or additional disclosure in the financial statements.
NOTE 3 - INVESTMENTS
The investment balance consists of corporate bonds. Investment activity during the yearis as follows:
Balance, beginning of year $ 593,814Proceeds from sales of investments (100,000)Unrealized losses on investments (5,507)
Balance, end of year $ 488,307
10
AFTER-SCHOOL ALL-STARS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2011
NOTE 4 - TEMPORARILY RESTRICTED NET ASSETS
Temporarily restricted net assets during the year are as follows:
Balance,July 1, 2010
TemporarilyRestrictedRevenue
Net AssetsReleased fromRestrictions
Balance,June 30, 2011
School Readiness $ 83,050 $ - $ 16,950 $ 100,000Time Restricted 1,136,135 137,190 (862,555) 410,770Waianae and Nanakuli
Intermediate Schools - 80,000 - 80,000
$ 1,219,185 $ 217,190 $ (845,605) $ 590,770
NOTE 5 - RETIREMENT PLANS
The Organization sponsors a defined contribution IRC Section 403(b) retirement plan inwhich all employees (as defined) are eligible to participate. The employees may elect tocontribute up to 100% of their salary (subject to overall limits) to the plan in any oneyear. Employee contributions are fully vested immediately upon contribution to the plan.The assets of the plan are invested at the discretion of the individual employees.
The Organization may choose to make a matching contribution and an additionaldiscretionary contribution for each participant. Organization-matching contributions anddiscretionary contributions are fully vested in this plan after three years of service.
NOTE 6 - COMMITMENTS
Operating Leases
The Organization leases office space and equipment under non-cancelable operatingleases through 2013. Future minimum payments required under the leases are asfollows:
Year Ending June 30,
2012 $ 136,8582013 140
$ 136,998
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AFTER-SCHOOL ALL-STARS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2011
NOTE 7 - RELATED PARTY TRANSACTIONS AND DUE FROM AFFILIATES
The Organization provided management services to four of its affiliated chapters forwhich it earned $28,700 in Business Service Unit ("BSU") management fees. TheOrganization ceased providing these management services on August 31, 2010.
The Organization made grants to its affiliated local chapters totaling $681,457 to be usedfor general operations, program quality, professional development and new curriculums.
The Organization has an unsecured, non-interest-bearing loan receivable from theGreater San Diego Chapter totaling $42,361.
The Organization has an unsecured, non-interest-bearing loan receivable from theColumbus Chapter totaling $10,756.
The Organization has an unsecured, non-interest-bearing loan receivable from theLos Angeles Chapter totaling $14,997.
The Organization has an unsecured, non-interest-bearing loan receivable from theBay Area Chapter totaling $100,000.
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