CANADIAN PARENTS FOR FRENCH MARCH 31, 2019 - CPF Home · 3/31/2019 · 2. SIGNIFICANT ACCOUNTING POLICIES The Organization applies Canadian accounting standards for not-for-profit

CANADIAN PARENTS FOR FRENCH

MARCH 31, 2019


TABLE OF CONTENTS

PAGE

Financial Statements

Independent Auditor's Report 1

Statement of Operations 4

Statement of Changes in Net Assets 5

Statement of Financial Position 6

Statement of Cash Flows 7

Notes to the Financial Statements 8

Supplementary financial information (unaudited)

Department of Canadian Heritage Program and Project Funding 13

1

INDEPENDENT AUDITOR'S REPORT

To the Members ofCanadian Parents for French

Qualified Opinion

We have audited the financial statements of Canadian Parents for French (the Organization), whichcomprise the statement of financial position as at March 31, 2019, and the statements of operations,changes in net assets and cash flows for the year then ended, and notes to the financial statements,including a summary of significant accounting policies.

In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinionsection of our report, the accompanying financial statements present fairly, in all material respects, thefinancial position of the Organization as at March 31, 2019, and the results of its operations and its cashflows for the year then ended in accordance with Canadian accounting standards for not-for-profitorganizations.

Basis for Qualified Opinion

In common with many registered charities, the Organization derives revenue from donations, thecompleteness of which is not susceptible of satisfactory audit verification. Accordingly, our audit ofthese revenues was limited to the amounts recorded in the records of the Organization. Therefore, wewere not able to determine whether any adjustments might be necessary to donations revenue, excess ofrevenue over expenses, and cash flow from operations for the year ended March 31, 2019 and 2018,current assets as at March 31, 2019 and 2018, and net assets as at March 31, 2019 and 2018 and April 1,2017. Our opinion on the financial statements for the year ended March 31, 2018 was modifiedaccordingly because of the possible effects of this limitation in scope.

We conducted our audit in accordance with Canadian generally accepted auditing standards. Ourresponsibilities under those standards are further described in the Auditor's Responsibilities for the Auditof the Financial Statements section of our report. We are independent of the Organization in accordancewith the ethical requirements that are relevant to our audit of the financial statements in Canada, and wehave fulfilled our other ethical responsibilities in accordance with these requirements. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualifiedaudit opinion.

Other Information

Management is responsible for the other information. The other information comprises the financialinformations included on page 13, but does not include the financial statements and our auditor's reportthereon.

Our opinion on the financial statements does not cover the other information and we do not express anyform of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistent with thefinancial statements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated. If, based on the work we have performed, we conclude that there is a material misstatement ofthis other information, we are required to report that fact. We have nothing to report in this regard.

2

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements inaccordance with Canadian accounting standards for not-for-profit organizations, and for such internalcontrol as management determines is necessary to enable the preparation of financial statements that arefree from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Organization's abilityto continue as a going concern, disclosing, as applicable, matters related to going concern and using thegoing concern basis of accounting unless management either intends to liquidate the Organization or tocease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Organization's financial reportingprocess.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole arefree from material misstatement, whether due to fraud or error, and to issue an auditor's report thatincludes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that anaudit conducted in accordance with Canadian generally accepted auditing standards will always detect amaterial misstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the economicdecisions of users taken on the basis of these financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exerciseprofessional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements, whether due to fraudor error, design and perform audit procedures responsive to those risks, and obtain audit evidence thatis sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error, as fraud may involvecollusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit proceduresthat are appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the Organization's internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis of accounting and,based on the audit evidence obtained, whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Organization's ability to continue as a going concern.If we conclude that a material uncertainty exists, we are required to draw attention in our auditor'sreport to the related disclosures in the financial statements or, if such disclosures are inadequate, tomodify our opinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However, future events or conditions may cause the Organization to cease to continueas a going concern.

Evaluate the overall presentation, structure and content of the financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions and events in amanner that achieves fair presentation.

3

We communicate with those charged with governance regarding, among other matters, the planned scopeand timing of the audit and significant audit findings, including any significant deficiencies in internalcontrol that we identify during our audit.

Chartered Professional Accountants, Licensed Public Accountants

Ottawa, OntarioAugust 15, 2019


STATEMENT OF OPERATIONS

FOR THE YEAR ENDED MARCH 31, 2019 4

2019 2018

REVENUE

ContributionsCanadian Heritage $ 1,116,000 $ 950,000

Self-generatedAdvertising 26,910 36,110Memberships 17,759 17,476In-kind contributions (Note 8) 14,082 -Donations 12,819 10,943Interest 1,857 1,208Other (publications, products, conference, sub-lease, etc.) 58,037 31,875Contract with the Office of the Commissioner of Official

Languages (OCOL) - 21,750

131,464 119,362

1,247,464 1,069,362

EXPENSES

Salaries and benefits 452,540 496,635Travel and accommodation 316,733 192,274Advertising and promotion 127,579 84,979Administration 107,477 80,022Rent 50,144 50,171Insurance 40,446 39,526Recognition & Awards 9,579 8,055Telecommunications 7,162 7,797Staff development 4,414 7,785Professional and consulting fees 108,763 82,938Interest and service charges 9,847 7,253Amortization of capital assets 6,413 6,516Amortization of intangible assets 2,442 3,897

1,243,539 1,067,848

EXCESS OF REVENUE OVER EXPENSES $ 3,925 $ 1,514


STATEMENT OF CHANGES IN NET ASSETS


Mary Joyce

Booth 2019 2018Unrestricted Reserve Total Total

BALANCE, BEGINNING OFYEAR $ 244,093 $ 88,794 $ 332,887 $ 331,373

Excess of revenue over expenses 3,925 - 3,925 1,514

Interfund transfers (Note 9) 4,807 (4,807) - -

BALANCE, END OF YEAR $ 252,825 $ 83,987 $ 336,812 $ 332,887


STATEMENT OF FINANCIAL POSITION

MARCH 31, 2019 6

2019 2018

ASSETS

CURRENT ASSETSCash $ 339,306 $ 199,202Guaranteed investment certificate, matured during the year - 88,794Accounts receivable (Note 3) 104,112 88,738Prepaid expenses 12,134 21,670

455,552 398,404

CAPITAL ASSETS (Note 4) 4,273 5,603

INTANGIBLE ASSETS (Note 5) 7,326 9,768

11,599 15,371

$ 467,151 $ 413,775

LIABILITY

CURRENT LIABILITYAccounts payable and accrued liabilities (Note 7) $ 130,339 $ 80,888

NET ASSETS

Unrestricted 252,825 244,093Internal restriction (Note 9)

Mary Joyce Booth Reserve 83,987 88,794

336,812 332,887

$ 467,151 $ 413,775

ON BEHALF OF THE BOARD

, Director , Director


STATEMENT OF CASH FLOWS


2019 2018

OPERATING ACTIVITIES

Excess of revenue over expenses $ 3,925 $ 1,514Adjustments for:Amortization of capital assets 6,413 6,516Amortization of intangible assets 2,442 3,897

12,780 11,927

Net change in non-cash working capital items:Accounts receivable (15,374) 48,173Prepaid expenses 9,536 (2,320)Accounts payable and accrued liabilities 49,451 3,933

43,613 49,786

56,393 61,713

INVESTING ACTIVITIES

Acquisition of capital assets (5,083) (1,194)Acquisition of intangible assets - (12,210)Purchase of guaranteed investment certificate - (388,794)Redemption of guaranteed investment certificate 88,794 394,123

83,711 (8,075)

INCREASE IN CASH AND CASH EQUIVALENTS 140,104 53,638

CASH AND CASH EQUIVALENTS, BEGINNINGOF YEAR 199,202 145,564

CASH AND CASH EQUIVALENTS, END OF YEAR $ 339,306 $ 199,202

Cash and cash equivalents consist of cash.


NOTES TO THE FINANCIAL STATEMENTS

MARCH 31, 2019 8

1. STATUTE AND NATURE OF OPERATIONS

Canadian Parents for French is incorporated as a not-for-profit organization under the Canada Not-for-profit Corporations Act. The primary focus of the Organization is to create and promoteopportunities for young Canadians to learn and use French as a second language. The Organizationis a registered charity for income tax purposes and, as such, is exempt from income tax.

The accompanying financial statements reflect the assets, liabilities and operating results of theCanadian Parents for French national association. Although the Organization is made up ofBranches and Chapters across Canada, each Branch is separately incorporated and these financialstatements do not reflect their assets, liabilities nor operating results.

2. SIGNIFICANT ACCOUNTING POLICIES

The Organization applies Canadian accounting standards for not-for-profit organizations(ASNFPO) in accordance with Part III of the CPA Canada Handbook – Accounting.

Use of estimates

The preparation of financial statements in compliance with the ASNFPO requires management tomake estimates and assumptions that affect the reported amounts of assets and liabilities and thereported amounts of revenues and expenses for the periods covered.

Revenue recognition

The Organization follows the deferral method of accounting for government contributions.Restricted contributions are recognized as revenue in the year in which the related expenses areincurred, when the amount can be reasonably estimated and the collection is reasonably assured.

Advertising, memberships, contracts and other revenue are recognized as revenue in the yearreceived or receivable if the amount to be received can be estimated and collection is reasonablyassured.

Contributions in kind, which otherwise would be purchased, are recorded as revenue and expensesat their fair value.

Donations are recognized when receivable and interest income is recognized when earned.

Contribution receivable

A contribution receivable is recognized as an asset when the amount to be received can bereasonably estimated and ultimate collection is reasonably assured.

Contributed services

The Organization would not be able to carry out its activities without the services of the manyvolunteers who donate a considerable number of hours. Because of the inherent difficulty incompiling these hours and determining their fair value, contributed services are not recognized inthe financial statements.



MARCH 31, 2019 9

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial instruments

Measurement of financial instruments

The Organization initially measures its financial assets and financial liabilities at fair value, exceptfor certain non-arm's length transactions.

The Organization subsequently measures all its financial assets and financial liabilities atamortized cost.

Financial assets measured at amortized cost include cash and accounts receivable.

Financial liabilities measured at amortized cost include accounts payable and accrued liabilities.

Impairment

Financial assets measured at amortized cost are tested for impairment when there are indicators ofpossible impairment. The Organization determines whether a significant adverse change hasoccurred in the expected timing or amount of future cash flows from the financial asset. If this isthe case, the carrying amount of the asset is reduced directly to the higher of the present value ofthe cash flows expected to be generated by holding the asset, and the amount that could be realizedby selling the asset at the balance sheet date. The amount of the write-down is recognized inoperations. The previously recognized impairment loss may be reversed to the extent of theimprovement, provided it is no greater than the amount that would have been reported at the dateof the reversal had the impairment not been recognized previously. The amount of the reversal isrecognized in operations.

Transaction costs

Transaction costs related to financial instruments subsequently measured at amortized cost reducethe carrying amount of the financial asset or liability and are accounted for in the statement ofoperations using the straight-line method.

Capital assets

Capital assets are accounted for at cost. Amortization is calculated on their respective estimateduseful lives using the straight-line method over the following periods:

Computers 3 yearsFurniture and equipment 5 years

Intangible assets

Intangible assets are accounted for at cost. Amortization is calculated on their respective estimateduseful lives using the straight-line method over the following periods:

Database 5 yearsComputer software 10 years



MARCH 31, 2019 10

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Write-down of capital assets

When a capital asset no longer contributes to the Organization's ability to provide services, itscarrying amount is written down to residual value, if any. The excess of its net carrying amountover any residual value is recognized as an expense in the statement of operations.

Cash and cash equivalents

The Organization's policy is to disclose bank balances under cash and cash equivalents, includingbank overdrafts with balances that can fluctuate from being positive to overdrawn.

3. ACCOUNTS RECEIVABLE

2019 2018

Harmonized sales tax $ 34,148 $ 13,882Other receivables (contracts, membership, recoverable

expenses) 69,964 74,856

$ 104,112 $ 88,738

4. CAPITAL ASSETS

AccumulatedCost amortization 2019 2018

Computers $ 38,464 $ 34,687 $ 3,777 $ 1,505Furniture and equipment 57,244 56,748 496 4,098

$ 95,708 $ 91,435 $ 4,273 $ 5,603

5. INTANGIBLE ASSETS

AccumulatedCost amortization 2019 2018

Database $ 12,210 $ 4,884 $ 7,326 $ 9,768Computer software 54,115 54,115 - -

$ 66,325 $ 58,999 $ 7,326 $ 9,768

6. BANK LOAN

The Organization has an authorized line of credit of $75,000. This line of credit bears interest atthe prime rate plus 5%. This line of credit is secured by a general security agreement. As atMarch 31, 2019 and 2018, this line of credit is unused.



MARCH 31, 2019 11

7. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

2019 2018

Trade accounts and accrued liabilities $ 130,339 $ 65,700Government remittances payable - 15,188

$ 130,339 $ 80,888

8. IN-KIND CONTRIBUTIONS

During the year, the Organization recognized as in-kind contributions an amount of $14,082equivalent to the fair value of contributions received without charge (2018: Nil). Thesetransactions were reflected in the statement of operations as Advertising and promotion.

9. INTERNAL RESTRICTION

Mary Joyce Booth Reserve

In 2011, the Board of Directors internally restricted resources amounting to $129,984, relating to abequest received from a donor in prior years. The amount was transfered to an internally restrictedfund named The Mary Joyce Booth Reserve and is to be used for the purpose of promoting andenhancing French-language learning opportunities.

During the year, the Board of Directors approved an allocation from the Reserve in the amount of$4,807 (2018: $5,329).

10. FINANCIAL INSTRUMENTS

Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for theother party by failing to discharge an obligation. The Organization’s main credit risks relate to itsaccounts receivable. The Organization provides credit to its clients in the normal course of itsoperations.

The Organization establishes allowances for doubtful accounts while keeping in mind the specificcredit risk of clients, their historic tendencies and economic situation. Approximately 62% of thetotal amount of other receivables is to be received from three entities. The Organization considersthat no risk arises from that situation.



MARCH 31, 2019 12

11. CONTRACTUAL OBLIGATIONS

The commitment of the Organization under a lease agreement aggregates to $73,460. Theinstalments over the next four years are the following:

2020 $ 22,6002021 $ 22,6002022 $ 22,6002023 $ 5,660

12. CONTINGENCIES

Other indemnification agreements

In the normal course of operations, the Organization signs agreements whereby funds are providedfor the execution of projects which are subject to restrictions as to the use of the funds. Thesponsors of the projects can ensure the compliance with the project requirements. In the event thatamounts to be reimbursed to the sponsor of a project are identified, the necessary adjustments willbe recognized in the year they are identified.

13. ECONOMIC DEPENDENCE

Contributions from Canadian Heritage represent approximately 89% of the Organization's totalrevenue. These contributions allow the Organization to carry its activities and its mission. Thesustainability of the Organization would be compromised should these contributions cease or bereduced. The Organization would therefore be forced to review its priorities as well as the risksassociated with its financial viability and sustainability.

14. COMPARATIVE FIGURES

Certain comparative figures have been reclassified to be consistent with the current year’spresentation.


SUPPLEMENTARY FINANCIAL INFORMATIONDEPARTMENT OF CANADIAN HERITAGE PROGRAM AND PROJECT FUNDING

FOR THE YEAR ENDED MARCH 31, 2019(Unaudited) 13

Core Québec 2019 2018Funding and Nunavut Total Total

REVENUE

Department of Canadian Heritage $ 996,000 $ 120,000 $ 1,116,000 $ 950,000CPF contribution 128,770 2,695 131,465 97,612Other projects - - - 21,750

1,124,770 122,695 1,247,465 1,069,362

EXPENSES

Salaries 387,235 65,305 452,540 496,635Honoraria 93,487 15,276 108,763 97,680Travel 296,803 22,761 319,564 192,274Publicity 140,887 6,525 147,412 120,279Administration – Staff development 4,414 - 4,414 7,785Administration (formerly operational costs) 198,019 12,828 210,847 153,195

1,120,845 122,695 1,243,540 1,067,848

EXCESS OF REVENUE OVER EXPENSES $ 3,925 $ - $ 3,925 $ 1,514

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CANADIAN PARENTS FOR FRENCH MARCH 31, 2019 - CPF Home · 3/31/2019 · 2. SIGNIFICANT ACCOUNTING POLICIES The Organization applies Canadian accounting standards for not-for-profit