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PRUDENCE CONSERVANCY, INC. FINANCIAL STATEMENTS DECEMBER 31, 2005 and 2004 (WITH ACCOUNTANT’S
REPORT THEREON) (WITH ACCOUNTANT'S 11E PORT THEREON) |
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PRUDENCE CONSERVANCY, INC. TABLE
OF CONTENTS Page Independent Auditor's Report
1 Financial
Statements: Statements
of Financial Position 2 Statements
of Activities 3 Statements
of Cash Flows 4 Notes
to Financial Statements 5‑9 Supplemental
Information: Schedules of
Program and Supporting Services 10 |
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DUFOUR & SCHMITT, LTD 50
EXCHANGE TERRACE TEL
(401)751‑7154 SUITE
310 FAX
(401)421‑7806 PROVIDENCE, R.I. 02903 The Board of Directors Prudence Conservancy, Inc. We have audited the accompanying
statements of financial position of Prudence Conservancy, Inc, (a nonprofit
organization) as of December 31, 2005 and 2004, and the related statements of
activities and cash flows for the years then ended. These financial statements are the responsibility of the
Organization's management. Our
responsibility is to express an opinion on these financial statements based
on our audit. We conducted our audits in accordance
with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of financial
misstatement. An audit includes,
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. 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, the
financial position of Prudence Conservancy, Inc. as of December 31, 2005 and
2004, and the changes in net assets and cash flows for the years then ended
in conformity with generally accepted accounting principles. Our audit was conducted for the purpose
of forming an opinion on the basic financial statements taken as a
whole. The supplementary information
presented on page 9 is presented for the purpose of additional analysis and
is not a required part of the basic financial statements. Such information has been subjected to the
auditing procedures applied in the audit of the basic financial statements
and, in our opinion, is fairly stated in all material respects in relation to
the basic financial statements taken as a whole. June l, 2006 |
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PRUDENCE CONSERVANCY, INC. STATEMENTS OF FINANCIAL POSITION December 31, 2005 and 2004 ASSETS 2005 2004 Cash and cash equivalents $ 112,002 127,016 Unconditional promises to give: Temporarily restricted 15,300 28,724 Prepaid expense 6,299 7,423 Deposit on land 1,000 0 Property and equipment, net of accumulated depreciation of $51,656 in 2005; $39,970 in
2004 2,683,776 1,029,244 Total assets $ 2,818,377 1,192,407 LIABILITIES Accounts payable $ 0 100 Accrued expenses 2,500 2,500 Total liabilities 2,500 2,600 NET ASSETS Unrestricted 48,218 55,596 Temporarily restricted 90,468 111,552 Permanently restricted 2,677,191 1,022,659 Total net assets 2,815,877 1,189,807 Total liabilities and
net assets $ 2,818,377 1,192,407 The accompanying notes are an integral part of these financial
statements. |
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PRUDENCE
CONSERVANCY, INC. STATEMENT
OF ACTIVITIES Year
ended December 21, 2005 and 2004 2005 2004 Temporarily Permanently Unrestricted Restricted Restricted Total Total Revenues, gains, and other support: Contributions and dues: Unrestricted (note 6) 19,075 1,637,800 1,656,875 25,127 Restricted (note 2 and
5) 12,999 12,999 23,084 Grants 2,000 1,000 3,000 1,750 Interest and dividends 697 1,326 2,023 670 Rental income 1,727 1,727 1,000 Fundraising events 3,304 3,304 851 Camp, grazing and garden fees 3,419 3,419 2,622 Product sales 1,285 1.285 515 Net assets restricted by
board! Board ‑designated
restrictions (2,490) 2,490 0 0 Net assets released tram
restrictions: Restrictions satisfied by payment 10,481 (38,899) 28,418 0 0 Total revenue, gains and other support 39,498 (21,084) 1,666,218 1,684,632 55,619 Expenses: Program services 10,470 10,470 8.233 Supporting services Management and general 29,238 11,686 40.924 29,719 Fund‑raising and
product expense 7,168 7,168 2.516 Total expenses 46,876 11,686 58,562 40,468 Change in net assets (7,378) (21,084) 1,654,532 1,626,070 15,151 Not assets at beginning of
year 55,596 111,552 1,022,659 1,189,807 1,174,656 Net assets at and of year $ 48,218 90,468 2,677,191 2,815,877 1,189,807 The accompanying notes are an integral part of these financial
statements. |
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PRUDENCE CONSERVANCY, INC. Notes to Financial Statements December 31, 2005 and 2004 NOTE I ‑ Nature of Activities
and Significant Accounting Policies Nature of Activities Prudence
Conservancy, Inc. (the Organization) was founded in 1987 in Prudence Island,
Rhode Island. Their objectives are:
to inform and educate residents of Prudence Island of and on various
environmental issues; and to maintain the rural character of Prudence through
the acquisition of open spaces properties and its ongoing stewardship role
with these properties. Promises to Give Contributions
are recognized when the donor makes a promise to give to the Organization
that is, in substance, unconditional.
Contributions that are restricted by the donor are reported as
increases in unrestricted net assets if the restriction expires in the fiscal
year in which the contributions are recognized. All other donor-restricted contributions are reported as
increases in temporarily or permanently restricted net assets depending on
the nature of the restrictions. When
a restriction expires, temporarily restricted net assets arc reclassified to
unrestricted net assets. Contributed Services SFAS
116 sets forth criteria that contributions of services shall be recognized if
the services received require specialized skills that are provided by
individuals possessing those skills and would typically need to be purchased
if not provided by donation. Any
other services provided by volunteers that do not meet the above criteria
shall not be recognized in the statements of activities. In
year 2005, legal services were donated to the Organization and recognized on
the statement of activities. Estimates The
preparation of the financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that effect certain reported amounts and disclosures. Accordingly, actual results could differ
from those estimates. |
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PRUDENCE CONSERVANCY, INC. Notes to Financial Statements December 31, 2005 and 2004 NOTE I ‑ Nature of Activities
and Significant Accounting Policies (continued) Property and Equipment It
is the Organization's policy to capitalize property and equipment with a life
expectancy of one year or more.
Purchased property and equipment is capitalized at cost, Donations of
property and equipment are recorded as contributions at their estimated fair
value. Such donations are reported as
unrestricted contributions unless the donor has restricted the donated asset
to a specific purpose. Assets donated
with explicit restrictions regarding their use and contributions of cash that
must be used to acquire property and equipment are reported as restricted
contributions. Absent donor
stipulations regarding how long those donated assets must he maintained, the
Organization reports expirations of donor restrictions when the donated or
acquired assets are placed in service as instructed by the donor. The Organization reclassifies temporarily
restricted net assets to unrestricted net assets at that time. Property and equipment are depreciated
using the straight‑line method. Financial Statement Presentation The
Organization has adopted Statement of Financial Accounting Standards (SFAS)
No. 117, "Financial Statements of Not‑for‑Profit
Organization.” Under SFAS No. 117,
the Organization is required to report information regarding its financial
position and activities according to three classes of net assets;
unrestricted net assets, temporarily restricted net assets, and permanently
restricted net assets. In addition,
the Organization is required to present a statement of cash flows. Contributions The
Organization has also adopted SFAS No. 116, "Accounting for
Contributions Received and Contributions Made." Contributions received are recorded as
unrestricted, temporarily restricted, or permanently restricted support
depending on the existence or nature or any
donor restrictions. Income
Taxes The
Organization is a nonprofit organization as described in Section 501 (c)(3)
of the Internal Revenue Code and is exempt from federal and state income
taxes, Cash
and Cash Equivalents For
purposes of the statements of cash flows, the Organization considers all
highly liquid investments available for current use with an initial maturity
of three months or less to be cash equivalents. 6 |
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PRUDENCE CONSERVANCY, INC. Notes to Financial Statements December 31, 2005 and 2004 NOTE 2 ‑ Restrictions of Net
Assets Restrictions
oil net assets at the end of 2005 and 2004 are related to: (1) temporarily
restricted ‑ funds raised through the Farnham Farm Project which is a
specified giving program to assist the organization in purchasing, improving,
and maintaining this historically and ecologically significant farm; Funds
donated for the purpose of renovating the barn at Farnham Farm for a
community room, and an endowment for specific donations to the endowment and
for memorials voted by the board which are not otherwise designated. (2)
permanently restricted ‑ donated property which has been generally
restricted by the donee for the purpose of protecting island land from
development. Included in the cash and
cash equivalents on the Statements of Financial Position, are temporarily
restricted funds totaling as follows: 2005 2004 Endowment
Fund $
28,805 24,617 Renovation
Fund 24,433 39,804 Farnham
Farm Fund 21,931 23,804 $ 75,169 88,225 NOTE 3 ‑ Property & Equipment Properly
and equipment consist of the following: 2005 2004 Land $2,381,982 738,485 Building
and improvements 332,186 309,465 Furniture
& equipment 21,264 21,264 2,735,432 1,069,214 Accumulated
depreciation 51,656 39,970 $
2,683,776 1,029,244 Depreciation
expense for 2005 and 2004 was $11,686 and $9,469, respectively. On
April 28, 2005, Preserve Rhode Island transferred to the organization all of
its right, title, and interest in and to the property located on Prudence
Island. At the date of transfer, the property had a fair value of $1,637,800. NOTE 4 ‑ Farnham Farm Project On
December 9, 1998, the Organization purchased the property from Albert
Jiacovelli for $350,000. The purchase
price was funded by a payment of $76,412, a mortgage note in the amount of
$175,000 as discussed in notes 3 and 4, and a contribution by Albert
Jiacovelli in the form of a reduction in the purchase price of $100,000. 7 |
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PRUDENCE
CONSERVANCY, INC. Notes
to Financial Statements December
31, 2005 and 2004 NOTE
4 ‑ Farnham Farm Project, continued The historic property will serve as
headquarters for the Organization and the Prudence Historical Society, and as
a focal point for stewardship, educational and recreational
programs available to the island community. A large portion of the building
contents were also donated to the Organization by Mr. Jiacovelli. The Organization was unable to obtain a
valuation for the personal property, therefore, no amount has been recorded in
the accompanying financial statements. The Organization engaged a planner and
facilitator to develop a master plan for restoration and adaptive reuse of
Farnham farm buildings. A portion of
the fee was funded from a grant provided by Preserve Rhode Island ‑
Citizens Bank mini‑grant program. The Organization has begun the complete
restoration and renovation of the farm buildings. The Organization estimates that this project will cost
approximately four hundred and twenty five thousand dollars ($425,000). The Organization is working to raise this
over the next four several years through pledges and pursuing matching funds
from foundations and the State and Federal government, As of December 31,
2004, the Organization has received donations and pledges t o totaling $
82,375. NOTE
5 ‑ Unconditional Promises to Give The Organization has accounted for the
doubtful collection or the capital campaign
receivables by providing a reserve in. the amount of $ 1,700 for 2005 and $
3,192 for 2004. Unconditional Promises to Give $
17,000 Less ‑ Allowance for
Unconditional Promises to Give (1.700) Net
Unconditional Promises to Give $
15,300 Receivables in less than one year $
12,900 Receivables in one to five years 2,400 Net
Unconditional Promises to Give $
15,300 |
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PRUDENCE CONSERVANCY, INC. Notes to Financial Statements December 31, 2005 and 2004 NOTE 6 ‑ Concentration of
Credit Risks The
organization maintains a bank account at a local bank. The Federal Deposit Insurance Corp. (FDIC)
up to $100,000 insures accounts at an institution. At December 31, 2004 the organization had no uninsured cash
balances. The Organization also
invests a majority of its cash at a local broker/dealer. The Organization does not believe that it
is exposed to any significant credit risk in connection with these funds,
since the broker/dealer invests primarily in U.S. Treasury securities. NOTE 7 ‑ Lease to use Coast
Guard Real Property The
Organization has entered into a lease agreement, expiring on
March 31, 2006, with the
United States Coast Guard. The lease
agreement permits the Organization to repair, maintain and secure Prudence
Island Lighthouse in accordance with the provisions of the National Historic
Preservation Act. The organization
will conduct educational tours, hold fund raising events with and for the
benefit of the general public. The
Organization is responsible for improvements, repairs and maintenance of the
lighthouse and is not permitted to use Coast Guard utilities. Based upon the Organization's non‑profit
nature and its intended use of the licensed facility there is no charge for
this license. NOTE 8 ‑ Commitment During
the year, the organization signed a Purchase and Sale Agreement to purchase
land for $60,000 with 24 months to raise the funds. A deposit in the amount
of $1,000 was made from donations totaling $ 1,100. |
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PRUDENCE CONSERVANCY, INC. SCHEDULE OF PROGRAM AND
SUPPORTING SERVICES Year ended December 31,
2005 and 2004 2005 2004 Temporarily Permanently Unrestricted Restricted Restricted Total Total Program services: Trail and property
maintenance $ 1,203 1,203 1,048 Camp and garden maintenance 4,417 4,417 818 Lighthouse maintenance 678 678 242 Newsletter and printing
expense 4,172 4.172 6,125 $ 10,470 10.470 8,233 Management and general: Office supplies $ 1,233 1,233 1,062 Postage 330 330 373 Telephone 568 568 599 Utilities 1,604 1,604 976 Insurance 5,524 5,524 5,733 Security expense 3,600 3,600 1,351 Professional fees 7,497 7,497 5.747 Dues and subscriptions 385 385 325 Repairs and maintenance 5,098 5,098 2,021 Rally expense 2,966 2,966 1,176 Annual meeting 433 433 887 Depreciation 11,686 11,686 9,469 $ 29,238 11,686 40,924 29,719 |
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