Boston Harbor Assoc Aud 12-31-11

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AuditedFinancial Statements

The Boston Harbor Association, Inc.

December 31, 2011


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Audited Financial Statements

December 31, 2011

INDEPENDENT AUDITORS' REPORT 1

AUDITED FINANCIAL STATEMENTS

STATEMENTS OF FINANCIAL POSITION 2

STATEMENTS OF ACTIVITIES AND CHANGES IN NET ASSETS 3

STATEMENTS OF CASH FLOWS 4

NOTES TO FINANCIAL STATEMENTS 5

OTHER FINANCIAL INFORMATION

INDEPENDENT AUDITORS' REPORT 9

SCHEDULES OF FUNCTIONAL EXPENSES 10


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INDEPENDENT AUDITORS' REPORT

Board of TrusteesThe Boston Harbor Association, Inc.

We have audited the accompanying statements of financial position of TheBoston Harbor Association, Inc. as of December 31, 2011 and 2010, and therelated statements of activities and changes in net assets and cash flows forthe years then ended. These financial statements are the responsibility of theAssociation's management. Our responsibility is to express an opinion onthese financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally

accepted in the United States of America. Those standards require that weplan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material misstatement. An audit includesexamining, on a test basis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includes assessing the accountingprinciples used and significant estimates made by management, as well asevaluating the overall financial statement presentation. We believe that ouraudits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in allmaterial respects, the financial position of The Boston Harbor Association, Inc.at December 31, 2011 and 2010 and the results of its activities and cash flowsfor the years then ended, in conformity with accounting principles generallyaccepted in the United States of America.

G.T. Reilly & Company

ReillyTech

Reilly Benefits

Reilly Business Services

424 Adams Street

Milton, MA 02186-4358617 696-8900

617 698-1803 faxwww.gtreilly.com


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Statements of Financial Position

December 31

ASSETS 2011 2010

CURRENT ASSETSCash and cash equivalents (Note 1) 266,662$ 292,959$Prepaid expenses 765 2,265

TOTAL CURRENT ASSETS 267,427 295,224

EQUIPMENT (Note 1)Office equipment 45,549 41,918 Less accumulated provisions for depreciation (41,591) (39,472)

3,958 2,446

FUNDS HELD FOR OTHERS (Note 5) 40,188 59,674

TOTAL ASSETS 311,573$ 357,344$

LIABILITIES AND NET ASSETS

CURRENT LIABILITIESAccounts payable 5,599$ 1,802$

Accrued expenses 32,077 31,097 TOTAL CURRENT LIABILITIES 37,676 32,899

FIDUCIARY LIABILITY (Note 5) 40,188 59,674

NET ASSETS (Note 1)Unrestricted 222,030 259,344 Temporarily restricted (Note 4) 11,679 5,427

TOTAL NET ASSETS 233,709 264,771

TOTAL LIABILITIES AND NET ASSETS 311,573$ 357,344$


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Statements of Cash Flows

Year Ended December 31

2011 2010CASH FLOWS FROM OPERATING ACTIVITIES

Change in net assets (31,062)$ (21,480)$Adjustments to reconcile change in net assets

to net cash provided by operating activities:Depreciation 2,119 6,309

Changes in operating assets and liabilities:Prepaid expenses 1,500 (1,198) Accounts payable 3,797 1,802 Accrued expenses 980 (1,327)

NET CASH USED IN OPERATING ACTIVITIES (22,666) (15,894)

CASH FLOWS USED IN INVESTING ACTIVITIES

Additions to office equipment (3,631) -

NET DECREASE IN CASH AND CASH EQUIVALENTS (26,297) (15,894)

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 292,959 308,853

CASH AND CASH EQUIVALENTS AT END OF YEAR 266,662$ 292,959$


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Notes to Financial Statements

December 31, 2011

Note 1 Nature of Activities and Significant Accounting Policies

Nature of Activities The Boston Harbor Association, Inc. (the Association) is a nonprofit association ofindividual, corporate and organizational members allied to enhance Boston Harbor through balanced,environmentally sensitive and accessible development, maintenance, and use. The Association advocatesfor greater public access, open spaces, and public amenities along Boston Harbor, monitors water quality

improvements and supports the restoration of Boston Harbor beaches for swimming, supports acomprehensive and affordable water transportation network throughout the Harbor, educates urban youthsabout Boston Harbor and related career opportunities, and promotes a "green" working port and waterfront.The Association is also a leader in focusing attention on sea-level rise in Boston Harbor.

Basis of Accounting The financial statements of the Association have been prepared on the accrual basisof accounting.

Financial Statement Presentation The Association reports information regarding its financial position andactivities according to three classes of net assets as determined by donor-imposed restrictions: unrestrictednet assets, temporarily restricted net assets, and permanently restricted net assets.

Unrestricted Net Assets Unrestricted net assets are those net resources that bear no externalrestrictions and are generally available for use by the Association. Unrestricted contributions arerecorded as support when received or unconditionally committed.

Temporarily Restricted Net Assets Restricted grants and contributions are recorded as temporarily

restricted support and net assets when received or committed. Transfers are made to unrestricted netassets as costs are incurred or time restrictions or program restrictions have lapsed (see Note 4).

Permanently Restricted Net Assets Contributions established by donor restrictions to permanentlymaintain the principal, while allowing the use of income generated therefrom, are classified aspermanently restricted support and net assets. Income derived from the investment of permanentlyrestricted funds is reported as unrestricted revenue or as restricted revenue depending on the termsof the donor instrument. Unrealized gains or losses on permanently restricted fund investments arereported as increases or decreases in temporarily restricted net assets unless the donor explicitlystates otherwise. There are no permanently restricted net assets at December 31, 2011 and 2010.

Contributions and Donor Restrictions The Association reports grants and contributions of cash or otherassets in the statement of activities as temporarily restricted net assets when received, if they are receivedwith donor stipulations that limit, specify or otherwise restrict the use of such contributions. When a donorrestriction expires, either by use of the funds for the specified purpose or by the expiration of a time


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Note 1 - Nature of Activities and Significant Accounting Policies (Cont.)

Cash Equivalents For purposes of the statement of cash flows, the Association considers all highly-liquidinvestments with a maturity of three months or less at the time of acquisition to be cash equivalents.

Equipment Equipment is recorded at cost or, in the case of donated assets, at fair market value.

Expenditures for maintenance and repairs are charged to expense as incurred, whereas major bettermentsare capitalized as additions to property and equipment. Depreciation is computed using the straight-linemethod over the estimate asset useful life of 5 years. Depreciation expense for 2011 is $2,119 ($6,309 in2010).

Income Taxes The Association is exempt from federal income taxes under Section 501(c)(3) of theInternal Revenue Code. The Association is also exempt from Massachusetts state income taxes and,therefore, has made no provision for federal or state income taxes in the accompanying financialstatements.

Contributed Facilities and Services The difference between the estimated fair rental value of the facilitiesand the amounts actually paid for rent is recorded as support with an equivalent amount recorded as rentexpense (see Note 3).

During the years ended December 31, 2011 and 2010, the value of contributed services meeting therequirements for recognition was not material and not recorded in the accompanying statements ofactivities. Many individuals volunteer their time and perform a variety of tasks that assist the Association

however; these services do not meet the criteria for recognition as contributed services in the financialstatements.

Functional Allocation of Expenses The costs of providing various programs and other activities have beensummarized on a functional basis in the statement of activities. Accordingly, certain costs have beenallocated among the programs and supporting services benefited.

Evaluation of Subsequent Events In accordance with generally accepted accounting principles,management has evaluated subsequent events involving the Association for potential recognition or

disclosure in the accompanying financial statements. Subsequent events are events or transactions thatoccurred after December 31, 2011, up through September 19, 2012, the date the accompanying financialstatements were available to be issued.

Note 2 - Pension Plan

The Association sponsors a Simple IRA plan for those employees eligible for participation. Contributionsmade for the year ended December 31, 2011 totaled $8,658 ($7,748 in 2010).

Note 3 Contributed Facilities

The Association originally entered into a lease expiring on December 31, 2012 requiring an annual baserent of $1. On December 1, 2011, the Association entered an agreement to extend this lease term through


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Note 4 Temporarily Restricted Net Assets

Temporarily restricted net assets are restricted for the following purposes and programs as follows atDecember 31:

2011 2010

Cedar Tree Harbor Bound 10,000$ -$Barr Foundation Sea-Level Rise - 5,427 Marine Debris 1,679 -

11,679$ 5,427$

Temporarily restricted net assets released and used for the following purposes for the year endedDecember 31:

2011 2010

Barr Foundation Sea-Level Rise 5,427$ 29,573$Marine Debris 38,320 -

43,747$ 29,573$

Note 5 Funds Held for Others

In a prior year, the Association accepted donations on behalf of the Judge A. David Mazzone Deer IslandMemorial Committee, Inc., for the purpose of creating and maintaining a memorial for Judge Mazzone onDeer Island. The Association does not have oversight or responsibility as to how the funds are used andonly acts as a custodian to the funds. The funds are maintained in a separate bank account. TheAssociation reports unexpended cash as funds held for others in its statement of financial position with anequivalent amount reported as fiduciary liability. As of December 31, 2011 and 2010, the fiduciary fundsand liability attributable to the Mazzone Fund were $40,188 and $59,674, respectively. A summary of fundsreceived and disbursed to maintain the memorial for the years ended December 31, 2011 and 2010 is asfollows:

Funds held for others at December 31, 2009 64,925$

Interest earned 35

Cash disbursements (5,286)

Funds held for others at December 31, 2010 59,674

Interest earned 26


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Note 6 - Financial Instruments, Credit Risk and Concentration Risks

The Associations financial instruments that may be subject to concentrations of credit risk consist of cashand cash equivalents.

The Association maintains its cash deposits with a high-quality financial institution. At December 31, 2011,bank balances did not exceed the FDIC insurance limit. The Associations cash equivalents consist ofmoney market funds held by a national investment house, which approximates $234,000 at December 31,2011.

The Association receives its support and revenues from individuals, corporations, charitable organizationsand foundations located within Massachusetts. In addition, several members of the Board of Directors areemployed by corporations or charitable organizations, or associated with foundations that contribute to theAssociation.

The following is a schedule of significant donations for the year ended December 31:2011 2010

% of total % of totalDonor Amount Donations Amount DonationsCorporation 20,000$ 41% *Massachusetts Port Authority 10,000$ 20% *Boston Redevelopment Authority 6,000$ 12% *

* Not a major concentration in 2010

The following is a schedule of significant grants for the year ended December 31:

2011 2010% of total % of total

Grantor Amount Grants Amount GrantsMass Water Resources Authority 20,000$ 25% *Mazzone Fund 15,000$ 19% *Foundation 10,000$ 13% 35,000$ 35%City of Boston 10,000$ 13% *Boston Water and Sewer Commission 10,000$ 13% 20,000$ 20%

* Not a major concentration in 2010

The following is a schedule of significant membership income for the year ended December 31:

2011 2010% of total % of total


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OTHER FINANCIAL INFORMATION


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INDEPENDENT AUDITORS' REPORT

Board of TrusteesThe Boston Harbor Association, Inc.

Our report on our audits of the basic financial statement of the Associationappears on Page 1. Our audits were made for the purpose of forming anopinion on the basic financial statements as a whole. The accompanyingschedules of functional expenses for the years ended December 31, 2011 and2010 are presented for purposes of additional analysis and are not a requiredpart of the basic financial statements. The information has been subjected to

the auditing procedures applied in the audits of the basic financial statements,and certain additional procedures, including comparing and reconciling suchinformation directly to the underlying accounting and other records used toprepare the financial statements or to the financial statements themselves, andother additional procedures in accordance with auditing standards generallyaccepted in the United States of America. In our opinion, the information isfairly stated in all material respects in relation to the basic financial statementsas a whole.

G. T. Reilly & Company

G.T. Reilly & Company

ReillyTechReilly Benefits

Reilly Business Services

424 Adams Street

Milton, MA 02186-4358617 696-8900

617 698-1803 faxwww.gtreilly.com


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Documents

Boston Harbor Assoc Aud 12-31-11