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8/7/2019 Pride Toronto Audited Financials 2010 Final
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PRIDE TORONTO
Financial Statements
Year ended July 31, 2010
Adams & Miles LLP
Chartered Accountan
8/7/2019 Pride Toronto Audited Financials 2010 Final
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PRIDE TORONTO
Index to Financial Statements
July 31,2010
PAGE
AUDITORS' REPORT.................................................................................................. 1
STATEMENT OF FINANCIAL POSITION......................................................................... 2
STATEMENT OF CHANGES IN NET ASSETS................................................................. 3
STATEMENT OF OPERATIONS........ 4
STATEMENT OF CASH FLOWS................................................................................... 5
NOTES TO FINANCIAL STATEMENTS........................................................................... 6 - 11
Adams & Miles LLP
Chartered Accountan
8/7/2019 Pride Toronto Audited Financials 2010 Final
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ADAMS & MILES LLPChartered Accountants
AUDITORS' REPORT
To the Board of Directors ofPride Toronto
501-2550 Victoria Park Ave.
Toronto, ON M2J 5A9
Tel 416 502.2201
Fax 416 502.2210
200-195 County Court Blvd.
Brampton, ON L6W 4P7
Tel 905 459.5605
Fax 905 459.2893
We have audited the statement of financial position of Pride Toronto as at
July 31, 2010 and the statements of changes in net assets, operations and
cash flows for the year then ended. These financial statements are the
responsibility of the Organization's management and its Directors. Our
responsibility is to express an opinion on these financial statements based on
our audit.
Except as noted in the following paragraph, we conducted our audit in
accordance with Canadian generally accepted auditing standards. Those
standards require that we plan and perform an audit to obtain reasonable
assurance whether the financial statements are free of material 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 the Organization's management and its Directors, as well as evaluating the
overall financial statement presentation.
In common with many not-for-profit organizations, the Organization derives
revenue from donations and fundraising. In addition, the Organization derives
revenue from beverage sales. The completeness of this revenue is not
susceptible to satisfactory audit verification. Accordingly, verification of this
revenue was limited to the amounts recorded in the records of the
Organization and we were not able to determine whether any adjustmentsmight be necessary to donation and fundraising revenue, beverage sales,
excess of revenue over expenditures, assets, liabilities and net assets.
In our opinion, except for the effect of adjustments, if any, which we might
have determined to be necessary had we been able to satisfy ourselves
concerning the completeness of donations referred to above, these financial
statements present fairly, in all material respects, the financial position of the
Organization as at July 31, 2010 and the results of its operations and its cash
flows for the year then ended in accordance with Canadian generally accepted
accounting principles.
jIaams 6 Z 9difes (]'
Chartered Accountants
Licensed Public Accountants
Toronto, Canada
October 14,2010
www.adamsmiles.com
An independent firm associated
with AGN International Ltd.
http://www.adamsmiles.com/http://www.adamsmiles.com/8/7/2019 Pride Toronto Audited Financials 2010 Final
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PRIDE TORONTO
Statement of Financial Position
July 31,2010
2010 2009
Assets
Current
Cash and cash equivalents (Note 3) $ $ 219,296
Accounts receivable 267,081 452,988
Inventory 28,266
Prepaid expenditures 68,476 28,503
335,557 729,053
Capital assets (Note 4) 70,207 27,198
405,764 756,251
Liabilities
Current
Bank indebtedness (Note 3) 155,232
Accounts payable and accrued 317,311 433,844
Current portion of capital lease obligations (Note 5) 17,027
489,570 433,844
Capital lease obligations (Note 5) 25,595
515,165 433,844
Net assets (deficit) $ (109,401) $ 322,407
Net Assets (Deficit) Represented by
Operating fund (deficit) $ (136,986) $ 295,209
Capital fund (Note 6) 27,585 27,198
$ (109,401) $ 322,407
Approved on behalf of the Board:
___________ Director
Director-----------
2Adams & Miles LLP
Chartered Accountan
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PRIDE TORONTO
Statement of Changes in Net Assets
Year ended July 31,2010
Operating Capital fund Total Total
fund (deficit) (Note 6) 2010 2009
Balance, beginning of year $ 295,209 $ 27,198 $ 322,407 $ 461,012
Excess of expenditures over
revenue (414,171) (17,637) (431,808) (138,605)
Interfund transfers (18,024) 18,024
Balance, end of year $ (136,986) $ 27,585 $ (109,401) $ 322,407
3 Adams & Miles LLPChartered Accountan
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PRIDE TORONTO
Statement of Operations
Year ended July 31,2010
2010 2009
Revenue
Sponsorship $ 1,469,027 $ 1,225,044
Grants (Note 8) 709,025 971,800
Permits and fees 261,213 238,523
Beverage sales 249,194 337,611
Donations and fund raising 192,672 184,359
Media and guide advertising sales 92,499 56,138
Interest and other 6,544 6,037
2,980,174 3,019,512
Expenditures
Media and promotion 1,159,040 985,388
Salaries and benefits 529,666 423,139
Festival infrastructure 391,823 485,789
Office and administration 355,211 278,317
Entertainment and events 263,964 322,527
Beverage cost of sales 184,817 226,321
Community outreach, fundraising and bursaries 183,235 149,846
Occupancy 135,048 82,674
Volunteer costs 107,868 63,428
Communications and security 58,532 67,695Insurance 28,993 65,124
Amortization 13,785 7,869
3,411,982 3,158,117
Excess of expenditures over revenue $ (431,808) $ (138,605)
4 Adams & Miles LLPChartered Accountan
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PRIDE TORONTO
Statement of Cash Flows
Year ended July 31,2010
2010 2009
Cash provided by (used in)
Operating activities
Excess of expenditures over revenue $ (431,808) $ (138,605)
Amortization 13,785 7,869
(418,023) (130,736)
Changes in
Accounts receivable 185,907 (106,669)
Inventory 28,266 (28,266)
Prepaid expenditures (39,973) (7,729)
Accounts payable and accrued (116,533) 204,507
(360,356) (68,893)
Financing activities
Bank indebtedness 155,232
Repayment of capital lease obligations (12,677)
Proceeds of capital lease obligations 55,299
197,854
Investing activities
Purchase of capital assets (56,794) (6,575)
Change in cash position (219,296) (75,468)
Cash, beginning of year 219,296 294,764
Cash, end of year $ $ 219,296
Cash and cash equivalents consist of:
Cash $ $ 135,697
Short-term investments 53,518
Term deposits 30,081
$ $ 219,296
Other information
Interest paid (received) $ 3,131 $ (898)
5 Adams & Miles LLPChartered Accountan
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PRIDE TORONTO
Notes to Financial Statements
Year ended July 31,2010
1. Nature of organization and going concern
Pride Toronto was incorporated as a not-for-profit organization without share capitalunder the laws of Ontario to promote the LGBTTIQQ2SA (Lesbian, Gay, Bisexual,
Transsexual, Transgender, Intersex, Queer/Questioning, 2Spirited, Allies) communities.
The Organization is exempt from income tax in Canada as a not-for-profit organization
under Section 149(1 )(L) of the Income Tax Act (Canada).
These financial statements have been prepared on a going concern basis which
contemplates the realization of assets and the payment of liabilities in the ordinary
course of business. Should the Organization be unable to continue as a going concern,it may be unable to realize the carrying value of its assets and to meet its liabilities as
they become due.
As a result of the deficit accumulated in the last two years, the Organization's ability to
realize its assets and discharge its liabilities depends on continued ability to refinance its
credit line, which amounts to $90,000 and is due on demand. To improve future cashflows, management and the Directors have adopted a plan to eliminate the deficit to
address this issue by reducing costs and increasing revenues, and are confident of
continued financing from its lending institution.
The accompanying financial statements do not include any adjustments relating to the
recoverability of assets and to the reclassification of asset and liability amounts that
might be necessary should the Organization be unable to continue its operations.
2. Summary of significant accounting policies
The preparation of financial statements in accordance with Canadian generally acceptedaccounting principles requires the Organization's management and its Directors to make
estimates and assumptions that affect the reporting amount of assets and liabilities anddisclosure of contingent assets and liabilities at the date of the financial statements and
the reported amount of revenue and expenditures during the year. These estimates arereviewed periodically, and, as adjustments become necessary, they are reported in the
result of operations in the year in which they become known.
Accrual basis of accounting
Revenue and expenditures are recorded on the accrual basis of accounting under whichthey are recorded in the financial statements in the year they are earned or incurred
respectively, whether or not such transactions have been settled by the receipt or
payment of money.
6 Adams & Miles LLPChartered Accountan
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PRIDE TORONTO
Notes to Financial Statements
Year ended July 31, 2010
2. Summary of significant accounting policies - cont'd
Fund accounting
The accounts of the Organization are maintained in accordance with the principles of
fund accounting and accordingly the resources are classified for accounting and
reporting purposes into funds determined by the purpose for which those funds are held.
The types of funds held are:
Operating Fund - This fund includes unrestricted revenue sources received from various
federal, provincial and municipal level grants, festival revenue, fundraising revenue and
day-to-day expenditures.
Capital Fund - This fund reports the net assets of the Organization invested in capital
assets.
Capital assets
Capital assets are recorded at cost and are being amortized over their estimated useful
lives on the following basis. The annual amortization rates and methods are as follows:
Equipment
Furniture and fixturesComputer equipment
Equipment under capital leases -
computers
20% declining balance20% declining balance
20% declining balance
20% declining balance
Capital assets individually in excess of $1,000 are capitalized by the Organization.
Revenue recognition
Revenue is recognized when received or receivable if the amount to be received can be
reasonably estimated and collection is reasonably assured.
The Organization follows the deferral method of revenue recognition. Under the deferralmethod, grants received in the year for expenditures to be incurred in the following year
are recorded as deferred revenue.
Non-monetary exchanges of goods and services are recorded at fair market ofconsideration received, as agreed-upon by the Organization and its vendors. The valueof voluntary services donated by individuals is not recognized in these financial
statements.
7 Adams & Miles LLP
Chartered Accountan
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PRIDE TORONTO
Notes to Financial Statements
Year ended July 31, 2010
3 . Cash and cash equivalents (bank indebtedness)
2010 2009
Bank $ 12,957 $ 135,697
Short-term investments 53,518
Term deposits 30,081
Operating loan (90,000)
Cheques issued in excess of funds held (78,189)
Total cash and cash eguivalents (bank indebtedness) $ (155,232) $ 219,296
The Organization has available a demand revolving line of credit in the amount of
$250,000 bearing interest at the bank prime rate plus 2.50%. This credit facility is
secured by a general security agreement. The bank covenant includes a certain
minimum net assets level to be maintained, as well as restrictions on assuming of newdebts. At year-end, the Organization was in violation of the bank covenant regarding its
net assets requirement.
4 . Capital assets
2010 2009
Accumulated Net Book Net Book
Cost Amortization Value Value
Equipment $ 24,662 $ 10,932 $ 13,730 $ 15,358
Furniture and fixtures 7,719 3,037 4,682 5,852
Computer equipment 14,825 10,034 4,791 5,988
47,206 24,003 23,203 27,198
Equipment under capital
leases - computers 55,299 8,295 47,004
$ 102,505 $ 32,298 $ 70,207 $ 27,198
Amortization in the amount of $8,295 (2009 - $Nil) on assets recorded as capital leases
is included in amortization.
8Adams & Miles LLP
Chartered Accountan
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PRIDE TORONTO
Notes to Financial Statements
Year ended July 31,2010
5. Capital lease obligations
The capital leases are recorded at an amount equal to the present value of the lease
payments using the interest rate implicit in the leases. The implicit interest rate of theseobligations is 13.00% and they mature from October 2012 to December 2012. The
following is a schedule of future minimum lease payments under capital leases.
2011
20122013
Total future minimum lease payments
Less amount representing interest
Present value of minimum net lease payments
Less current portion
$
$
21,49221,492
6,405
49,389(6,767)
42,622(17,027)
25,595
Interest in the amount of $3,852 (2009 - $NiI) was paid on capital leases during the year.
The obligations under capital leases are secured by liens on the computer equipment
leased.
6 . Capital fund
2010 2009
Capital assets $ 70,207 $ 27,198
Capital lease obligation (42,622)
Capital fund balance $ 27,585 $ 27,198
Expenditures during the year include amortization of $13,785 (2009 - $7,869) and
interest on the lease obligation of $3,852 (2009 - $NiI).
7. Related party transactions
During the year, the Organization paid $40,317 in consulting fees to an individual relatedto the Executive Director and a corporation controlled by the individual, for website
updating and newsletter services.
9Adams & Miles LLP
Chartered Accountan
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PRIDE TORONTO
Notes to Financial Statements
Year ended July 31, 2010
8. Grants
Grants recognized in the year were as follows:
2010 2009
The Government of Canada
Canadian Heritage $ 165,900 $
Canada Council for the Arts 100 32,200
Marquee Tourism Events Program (13,782) 360,000Service Canada 5,320
The Province of Ontario
Ontario Ministry of Tourism - Tourism Development
Fund 300,000
Ontario Ministry of Tourism - Celebrate Ontario 300,000
Ontario Cultural Attractions Fund 51,000
Ontario Tourism Marketing Partnership Corporation 50,000
The Ontario Trillium Foundation 78,000
The City of TorontoEconomic Development / Major Cultural
Organization Grant 123,807 121,380
Tourism Toronto 50,000 46,900
World Pride Grant 5,000
Access, Equity and Human Rights Grant 5,000
$ 709,025 $ 971,800
10Adams & Miles LLP
Chartered Accountan
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PRIDE TORONTO
Notes to Financial Statements
Year ended July 31,2010
9. Commitments
The Organization has entered into a lease agreement to rent its office space until March
31, 2015 and a lease for an office photocopier. Lease payments in the next five years
are as follows:
2011
2012
2013
2014
2015
$ 125,371
134,371
141,121
147,121
98,405
The Organization has entered into a contract to designate CTV and CP24 as exclusive
broadcast media sponsors of the Organization for 2010 and 2011 Pride Toronto events,
in return for media support to be provided to the Organization.
10. Financial instruments
The Organization's financial instruments consist of bank indebtedness, accounts
receivable and accounts payable and accrued. It is management's opinion that the
Organization is not exposed to significant currency or credit risks arising from these
financial instruments. The fair value of these financial instruments approximates their
carrying values, unless otherwise noted.
Interest rate riskThe Organization is exposed to interest rate risk on its floating rate borrowings, as the
required cash flows to service the debt will fluctuate as a result of changes in market
rates.
11. Comparative amounts
Certain comparative amounts have been reclassified to conform to the current year's
financial statement presentation.
11Adams & Miles LLP
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