Fiscal Year 2011-2012

JACKSONVILLE SYMPHONY ASSOCIATION(A NOT-FOR-PROFIT ORGANIZATION)

AND

JACKSONVILLE SYMPHONY FOUNDATION(A NOT- FOR -PROFIT ORGANIZATION)

FINANCIAL REPORT

YEARS ENDED JUNE 30, 2012 AND 2011

JACKSONVILLE SYMPHONY ASSOCIATION(A NOT-FOR-PROFIT ORGANIZATION)

AND

JACKSONVILLE SYMPHONY FOUNDATION(A NOT- FOR -PROFIT ORGANIZATION)

TABLE OF CONTENTS

Report of independent certified public accountants 1

Financial statements:

Combined statements of financial position with combining information 3

Combined statements of activities with combining information 4

Combined statements of cash flows with combining information 5

Notes to combined financial statements 6

Supplemental schedules:

Combining schedules of financial position 20

Combining schedules of activities 22

Report on internal control over financial reporting and on compliance and other matters based on an audit of financial statements performed in accordance with Government Auditing Standards 24

Report of independent certified public accountants on the management assertion report 26

Management assertion report 27

Schedule of state financial assistance 28

1

Report of Independent Certified Public Accountants

To The Board of Directors of Jacksonville Symphony Association

and Jacksonville Symphony FoundationJacksonville, Florida

We have audited the accompanying combined statements of financial position of the Jacksonville Symphony Association (a not-for-profit organization) and the Jacksonville Symphony Foundation (a not-for-profit organization) as of June 30, 2012 and 2011, and the related combined statements of activities and cash flows for the years then ended. These financial statements are the responsibility of the Jacksonville Symphony Association and Jacksonville Symphony Foundation’s management. Our responsibility is to express an opinion on these combined financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about 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 management, as well as evaluating the overall financial statement presentation. We believe that our audits provide 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 the Jacksonville Symphony Association and the Jacksonville Symphony Foundation as of June 30, 2012 and 2011, and the changes in their net assets and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

In accordance with Government Auditing Standards, we have also issued our report dated October 8, 2012,on our consideration of the Jacksonville Symphony Association and Jacksonville Symphony Foundation’s internal control over financial reporting and on our tests of their compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit.

Our audits were conducted for the purpose of forming an opinion on the combined financial statements as a whole. The combining information on pages 3, 4, 5, 20, 21, 22 and 23 is presented for purposes of additional analysis of the combined financial statements rather than to present the financial position,

501 Riverside Avenue, Suite 800, Jacksonville, FL 32202-4939 904.396.4015 904.399.4012www.TheLBAGroup.com

The

G RO U P

AccountantsConsultantsWealth Advisors

LBA Certified Public Accountants, PA

2

changes in net assets, and cash flows of the individual organizations or funds, and it is not a required part of the combined financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the combinedfinancial statements. The combining information has been subjected to the auditing procedures applied in the audit of the combined financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the combined financial statements or to the combined financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining information is fairly stated in all material respects in relation to the combinedfinancial statements as a whole.

October 8, 2012

The

G RO U P


Assets:Cash and cash equivalents 178,208$ -$ 178,208$ Contributions receivable, net 1,317,242 - 1,317,242 Other receivables and accrued interest 148,906 32 148,938 Investments 7,492,458 6,804,459 14,296,917 Property and equipment, net 61,222 - 61,222 Other assets 264,683 - 264,683

Total assets 9,462,719$ 6,804,491$ 16,267,210$

Liabilities and net assets:Liabilities:

Accounts payable and accrued liabilities 352,055$ -$ 352,055$ Deferred revenue - concert ticket sales

and sponsorships 1,249,033 - 1,249,033 Line of credit 1,787,789 - 1,787,789

Total liabilities 3,388,877 - 3,388,877

Net assets:Unrestricted:

Undesignated (3,129,311) - (3,129,311) Board designated 7,801,993 6,804,491 14,606,484

Total unrestricted 4,672,682 6,804,491 11,477,173 Temporarily restricted 1,401,160 - 1,401,160

Total net assets 6,073,842 6,804,491 12,878,333

Total liabilities and net assets 9,462,719$ 6,804,491$ 16,267,210$

JACKSONVILLE SYMPHONY ASSOCIATION

JUNE 30, 2012

COMBINED STATEMENT OF FINANCIAL POSITIONAND JACKSONVILLE SYMPHONY FOUNDATION

Jacksonville Symphony Association

Jacksonville Symphony Foundation Total

WITH COMBINING INFORMATION

Assets:

Cash and cash equivalents 178,523$ -$ 178,523$

Contributions receivable, net 603,523 - 603,523

Other receivables and accrued interest 246,125 - 246,125

Investments 7,440,541 6,567,864 14,008,405

Property and equipment, net 31,507 - 31,507

Other assets 220,908 - 220,908

Total assets 8,721,127$ 6,567,864$ 15,288,991$

Liabilities and net assets:

Liabilities:

Accounts payable and accrued liabilities 265,847$ 2,060$ 267,907$

Deferred revenue - concert ticket sales

and sponsorships 1,155,039 - 1,155,039

Line of credit 468,611 - 468,611

Total liabilities 1,889,497 2,060 1,891,557

Net assets:

Unrestricted:

Undesignated (2,625,399) - (2,625,399)

Board designated 7,899,372 6,565,804 14,465,176

Total unrestricted 5,273,973 6,565,804 11,839,777

Temporarily restricted 1,557,657 - 1,557,657

Total net assets 6,831,630 6,565,804 13,397,434

Total liabilities and net assets 8,721,127$ 6,567,864$ 15,288,991$

See accompanying notes to financial statements.


AND JACKSONVILLE SYMPHONY FOUNDATION

COMBINED STATEMENT OF FINANCIAL POSITION

JUNE 30, 2011

Jacksonville

Symphony

Association

Jacksonville

Symphony

Foundation Total


3

Undesignated Total TotalRevenues and other support:

Ticket sales and concert fees 2,796,517$ -$ -$ 2,796,517$ -$ 2,796,517$ Contributions - 24,099 3,949,263 3,973,362 - 3,973,362 Grants - - 389,530 389,530 - 389,530 Advertising 105,640 - - 105,640 - 105,640 Fund raising activities 267,371 - - 267,371 - 267,371 Investment income 3,584 145,067 - 148,651 4,939 153,590 Gain on sale of investments - 60,638 - 60,638 243,544 304,182 Unrealized investment gain - 181,302 - 181,302 341,286 522,588 Other revenue 134,983 - - 134,983 - 134,983

Total revenues and other support 3,308,095 411,106 4,338,793 8,057,994 589,769 8,647,763

Net assets released from restricted and board designated 5,197,885 (378,475) (4,495,290) 324,120 (324,120) -

Expenses:

Musical productions:

Salaries and benefits 4,471,163 - - 4,471,163 - 4,471,163 Advertising and promotion 984,980 - - 984,980 - 984,980 Production expenses 1,326,033 - - 1,326,033 - 1,326,033 Guest artist fees 700,405 - - 700,405 - 700,405

Total musical productions 7,482,581 - - 7,482,581 - 7,482,581

Supporting services:

Interest expense 14,434 - - 14,434 - 14,434 Fund raising activities 304,680 - - 304,680 - 304,680 Administrative salaries and benefits 1,093,928 - - 1,093,928 - 1,093,928 General and administrative expenses 240,204 4,075 - 244,279 26,962 271,241

Total supporting services 1,653,246 4,075 - 1,657,321 26,962 1,684,283

Total expenses 9,135,827 4,075 - 9,139,902 26,962 9,166,864

Net assets released by board 150,000 (150,000) - - - -

Net assets designated by board (24,065) 24,065 - - - -

Change in net assets (503,912) (97,379) (156,497) (757,788) 238,687 (519,101)

Net assets, beginning of year (2,625,399) 7,899,372 1,557,657 6,831,630 6,565,804 13,397,434

Net assets, end of year (3,129,311)$ 7,801,993$ 1,401,160$ 6,073,842$ 6,804,491$ 12,878,333$


YEAR ENDED JUNE 30, 2012

COMBINED STATEMENT OF ACTIVITIESAND JACKSONVILLE SYMPHONY FOUNDATION

Temporarily Restricted

Board Designated

Board Designated

UnrestrictedJacksonville Symphony Association

Jacksonville Symphony Foundation


Revenues and other support:

Ticket sales and concert fees 2,364,481$ -$ -$ 2,364,481$ -$ 2,364,481$

Contributions - 381,765 3,961,727 4,343,492 - 4,343,492

Grants - - 373,603 373,603 - 373,603

Advertising 103,171 - - 103,171 - 103,171

Fund raising activities 294,191 - - 294,191 - 294,191

Investment income 17,398 197,519 - 214,917 6,806 221,723

Gain on sale of investments - 44,826 - 44,826 421,970 466,796

Unrealized investment (loss) gain - (1,861) - (1,861) 1,111,834 1,109,973

Other revenue 121,098 - - 121,098 - 121,098

Total revenues and other support 2,900,339 622,249 4,335,330 7,857,918 1,540,610 9,398,528

Net assets released from restricted

and board designated 5,315,238 (695,008) (4,354,132) 266,098 (266,098) -

Expenses:

Musical Productions:

Salaries and benefits 4,221,348 - - 4,221,348 - 4,221,348

Advertising and promotion 1,028,383 - - 1,028,383 - 1,028,383

Production expenses 1,082,251 - - 1,082,251 - 1,082,251

Guest artist fees 584,048 - - 584,048 - 584,048

Total musical productions 6,916,030 - - 6,916,030 - 6,916,030

Supporting services:

Interest expense 7,361 - - 7,361 - 7,361

Fund raising activities 279,074 68,744 - 347,818 - 347,818

Administrative salaries and benefits 1,089,719 - - 1,089,719 - 1,089,719

General and administrative expenses 254,758 1,057 - 255,815 29,639 285,454

Total supporting services 1,630,912 69,801 - 1,700,713 29,639 1,730,352

Total expenses 8,546,942 69,801 - 8,616,743 29,639 8,646,382

Change in net assets (331,365) (142,560) (18,802) (492,727) 1,244,873 752,146

Net assets, beginning of year (2,294,034) 8,041,932 1,576,459 7,324,357 5,320,931 12,645,288

Net assets, end of year (2,625,399)$ 7,899,372$ 1,557,657$ 6,831,630$ 6,565,804$ 13,397,434$





Total

Unrestricted

Jacksonville Symphony Association

Jacksonville

Symphony

Foundation

Undesignated

Board

Designated

Temporarily

Restricted Total

Board

Designated

COMBINED STATEMENT OF ACTIVITIES


4

Cash flows from operating activities:

Change in net assets (757,788)$ 238,687$ (519,101)$

Adjustments to reconcile change in net assets

to net cash used by operating activities:

Gain on sale of investments (60,638) (243,544) (304,182)

Unrealized investment gain (181,302) (341,286) (522,588)

Investment management fees - 25,277 25,277

Depreciation 21,472 - 21,472

Net changes in:

Contributions receivable (713,719) - (713,719)

Other receivables and accrued interest 97,219 (32) 97,187

Other assets (43,775) - (43,775)

Accounts payable and accrued liabilities 86,208 (2,060) 84,148

Deferred revenue 93,994 - 93,994

Net cash used by operating activities (1,458,329) (322,958) (1,781,287)

Cash flows from investing activities:

Purchases of investments (650,122) (415,536) (1,065,658)

Net (increase) decrease in money market and

certificate of deposit investments (11,351) 18,440 7,089

Proceeds from sales of investments 851,496 720,054 1,571,550

Purchases of property and equipment (51,187) - (51,187)

Net cash provided by investing activities 138,836 322,958 461,794

Cash flows from financing activities:

Net increase in line of credit 1,319,178 - 1,319,178

Net decrease in cash and cash equivalents (315) - (315)

Cash and cash equivalents, beginning of year 178,523 - 178,523

Cash and cash equivalents, ending of year 178,208$ -$ 178,208$

Supplemental disclosure of cash flow information:

Interest paid 14,434$ -$ 14,434$



COMBINED STATEMENT OF CASH FLOWS


Jacksonville

Symphony

Association

Jacksonville

Symphony

Foundation Total


Cash flows from operating activities:

Change in net assets (492,727)$ 1,244,873$ 752,146$

Adjustments to reconcile change in net assets

to net cash used by operating activities:

Loss on disposal of assets 752 - 752

Gain on sale of investments (44,826) (421,970) (466,796)

Unrealized investment loss (gain) 1,861 (1,111,834) (1,109,973)

Investment management fees - 25,527 25,527

Depreciation 37,200 - 37,200

Net changes in:

Contributions receivable 79,455 - 79,455

Other receivables and accrued interest (132,978) - (132,978)

Other assets (40,845) - (40,845)

Accounts payable and accrued liabilities 14,478 1,030 15,508

Deferred revenue 64,077 - 64,077

Net cash used by operating activities (513,553) (262,374) (775,927)

Cash flows from investing activities:

Purchases of investments (1,401,714) (116,623) (1,518,337)

Net decrease (increase) in money market and

certificate of deposit investments 9,107 (20,986) (11,879)

Proceeds from sales of investments 1,555,226 399,983 1,955,209

Purchases of property and equipment (8,549) - (8,549)

Net cash provided by investing activities 154,070 262,374 416,444

Cash flows from financing activities:

Net decrease in line of credit (31,389) - (31,389)

Net decrease in cash and cash equivalents (390,872) - (390,872)

Cash and cash equivalents, beginning of year 569,395 - 569,395

Cash and cash equivalents, ending of year 178,523$ -$ 178,523$

Supplemental disclosure of cash flow information:

Interest paid 7,361$ -$ 7,361$


COMBINED STATEMENT OF CASH FLOWS



Jacksonville

Symphony

Association

Jacksonville

Symphony

Foundation Total



5



NOTES TO COMBINED FINANCIAL STATEMENTS


6

1. Organization

The Jacksonville Symphony Association (the "Association") is a not-for-profit organization established to encourage and expand musical appreciation in the community.

The Jacksonville Symphony Foundation (the “Foundation”) is a not-for-profit organization established to provide financial assistance and support to the Association. The Foundation was fully funded by investments transferred from the Association.

The Association and the Foundation are collectively referred to as the “Symphony.”

2. Summary of Significant Accounting Policies

This summary of significant accounting policies of the Symphony is presented to assist in understanding the combined financial statements. The combined financial statements and accompanying notes are representations of the Symphony’s management. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the presentation of the combined financial statements.

Use of Estimates

The preparation of combined financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the combined financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Principals of Combination

The accompanying combined financial statements include the accounts of the Association and the Foundation, which are under common control. Significant intercompany transactions and balances have been eliminated in the combination.

Fund Accounting

To ensure observance of limitations and restrictions placed on the use of resources available to the Symphony, its accounts are maintained in accordance with the principles of fund accounting. This is the procedure by which resources are classified for accounting purposes into funds established according to their nature and objectives. Separate accounts are maintained for each fund.

The assets, liabilities and fund balances of the Symphony are accounted for in self-balancing funds as follows:

The Operating Fund represents the portion of expendable funds that are available for support of Association operations.

The Endowment Fund represents funds that are either designated for a particular use by the Board of Directors ("Board") or are subject to restrictions by the donor or grantor. Income from endowment investments may be used for support of Association operations.





7

2. Summary of Significant Accounting Policies (Continued)

The Guild Fund, controlled by volunteers of the Jacksonville Symphony Guild, represents the portion of expendable funds that is available for support of Jacksonville Symphony Guild and Association operations.

The Organ Fund represented funds that were designated for the restoration of a pipe organ. The restoration project was completed in fiscal year 2002 and the pipe organ was relinquished to theCity of Jacksonville. All funds were then expendable funds available for support of Association operations. In 2011, the Symphony transferred the balance of the Organ Fund to the Operating Fund.

The Bridge Fund represents funds that are either designated by the Board or were donated by a small group of donors to fund potential operating budgetary shortfalls that might have occurred through the 2012 fiscal year. In 2012, the Symphony transferred the balance of the temporarily restricted Bridge Fund to the Operating Fund. The Board designated Bridge Fund dollars were held to fund future potential operating budgetary shortfalls.

The Foundation Fund represents funds that are designated for a particular use by the Board.

Net Asset Classifications

Net assets, revenues, expenses, gains and losses are classified based on the existence or absence of donor-imposed restrictions. Accordingly, net assets and the changes therein are classified as follows:

a. Undesignated net assets - Net assets and contributions not subject to donor-imposed stipulations.

b. Board designated net assets - Net assets and contributions subject to Board designation. Generally, the income earned on related investments is designated for general or specific purposes. Board designated net assets include investments designated as endowments, certain contributions received and accumulated gains or losses on restricted endowments which are not stipulated by the donor or law for permanent reinvestment.

c. Temporarily restricted net assets - Net assets and contributions subject to donor-imposed stipulations that may or will be met by actions of the Symphony and/or the passage of time. After the donor-imposed time or purpose restriction is satisfied, temporarily restricted net assets are reclassified to unrestricted net assets and reported within the combined statement of activities as net assets released from restrictions. There were no permanently restricted net assets at June 30, 2012 and 2011.

Revenues are reported as increases in unrestricted net assets unless use of the related assets is limited by donor-imposed restrictions or Board action. Federal and local grants are recognized as unrestricted revenue to the extent expenses have been incurred under the terms of the respective grant agreements. Expenses are reported as decreases in unrestricted net assets. Gains and losses on investments and other assets or liabilities are reported as increases or decreases in Board designated net assets unless their use is restricted by donor stipulation, law or by Board action.





8


Contributions

Contributions, including unconditional promises to give due in future periods, are recognized as revenues in the period made or received. Conditional promises to give, which depend upon specified future and uncertain events, are recognized as revenue when the conditions upon which they depend are substantially met.

An allowance for uncollectible contributions receivable is provided based upon management's judgment including such factors as prior collection history, type of contribution, and nature of fund-raising activity. It is the Symphony’s policy to charge off uncollectible accounts when management determines the receivable will not be collected.

Contributions to be received after one year are discounted at an appropriate discount rate commensurate with the risks involved. Amortization of discounts is recorded as additional contribution revenue in accordance with donor-imposed restrictions, if any, on the contributions.

Contributions received with donor-imposed restrictions that are met in the same year as the contribution is received are reported initially as revenues of the temporarily restricted net asset class, and a reclassification to unrestricted net assets is made to reflect the expiration of such restrictions.

Contributions of property and equipment without donor stipulations concerning the use of such long-lived assets are reported as revenues of the unrestricted net asset class. Contributions of assets other than cash are recorded at their estimated fair value at the date received. Contributions of cash or other assets to be used to acquire property and equipment are reported as revenues of the temporarily restricted net asset class; the restrictions are considered to be released at the time of acquisition of such long-lived assets.

A substantial number of volunteers have donated significant amounts of their time to the Symphony. No amounts have been reflected in the statements for contributed services since the contribution of services did not create or enhance non-financial assets or require specialized skills. When professional services are donated, in-kind values are recorded as contributions. The Symphony recognized $42,000 in donated legal services during the year 2012. These amounts are included as in-kind production expense in Note 8.

Cash and Cash Equivalents

The Symphony considers all highly liquid investments purchased with an initial maturity of three months or less to be cash equivalents, except for certain money market and commercial paper investments held within the marketable securities portfolio. The Symphony places its temporary cash investments with FDIC insured institutions. At times, such investments may be in excess of FDIC insurance limits. The Symphony does not believe it is exposed to any significant credit risk with respect to cash and cash equivalents.





9


Investments

Investments are carried at fair value (see note 7 for fair value measurements). Fair value is the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Realized and unrealized gains and losses are included in the combined statements of activities.

Board Designated Endowment

At June 30, 2012 and 2011, the Board of Directors had designated $14,606,484 and $14,465,176, respectively of unrestricted net assets as a general endowment to support the mission of the Symphony.Since that amount resulted from an internal designation and is not donor-restricted, it is classified and reported as unrestricted net assets.

The Symphony has a spending policy of appropriating for distribution each year up to 5% of its Board designated endowment’s fair market value at year end. In establishing this policy, the Symphonyconsidered the long-term expected investment return on its endowment. Accordingly, over the long term, the Symphony expects the current spending policy to allow its general endowment fund to grow at an average of 3.5% annually. This is consistent with the Symphony’s objective to maintain, and preferably enhance, the transfer power of its assets in perpetuity.

To achieve that objective, the Symphony has adopted an investment policy that attempts to maximize total return consistent with an acceptable level of risk. Endowment assets are invested in a well diversified asset mix, which includes equity and debt securities and certain approved alternative investments, that is intended to result in a consistent inflation-protected rate of return that has sufficient liquidity to make an annual distribution of 5%, while growing the fund if possible. Accordingly, the Symphony expects its endowment assets, over time, to produce an average rate of return of approximately 8.5%. Actual returns in any given year may vary from this amount. Investment risk is measured in terms of the total endowment fund; investment assets and allocation between asset classes and strategies are managed to not expose the fund to unacceptable levels of risk.

Property and Equipment

Property and equipment with values of $200 or more, and a useful life longer than a year, are capitalized. Property and equipment are stated at cost. Maintenance and repairs are charged to expense as incurred. When items of property and equipment are sold or otherwise disposed of, the asset and related accumulated depreciation accounts are eliminated, and any gain or loss is included in operations. Depreciation is provided over the estimated useful life (3 to 10 years) of the related assets using the straight-line method.

The Symphony periodically reviews property and equipment for indicators of potential impairment. If this review indicates that the carrying amount of these assets may not be recoverable, the Symphony estimates the future cash flows expected to result from the operations of the asset and its eventual disposition. If the sum of these future cash flows (undiscounted and without interest charges) is less than the carrying amounts of the asset, the Symphony records an impairment loss based on the fair value of the asset.





10


Deferred Revenue

The Symphony records amounts received for the purchase of the following seasons' concert tickets and sponsorships as deferred revenue. These amounts will be recognized as revenue in the related concert year.

Income Taxes

The Association and the Foundation are not-for-profit organizations as described in Section 501(c)(3) of the Internal Revenue Code and are exempt from federal and state income taxes on related income pursuant to Section 501(a) of the Internal Revenue Code and Chapter 220.13 of the Florida Statutes, respectively.

The Symphony evaluates its tax positions for any uncertainties based on the technical merits of the position taken. The Symphony recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be upheld on examination by taxing authorities.

Subsequent Events

The Symphony has evaluated events through the date of the report of independent certified public accountants, the date the financial statements were available to be issued.

3. Line of Credit

The Symphony has a $3,600,000 line of credit which is due on demand and bears interest at LIBOR plus 0.5% (1.57% at June 30, 2012). The line is secured by investments in Berkshire Hathaway and other corporate stocks, SunTrust cash reserves and various corporate and U.S. Treasury Bonds.

4. Property and Equipment

Property and equipment consisted of the following at June 30:

2012 2011

Furniture and fixtures $ 780,284 $ 734,888Instruments 399,387 393,597Leasehold improvements 344,953 344,953

Total property and equipment 1,524,624 1,473,438Less: accumulated depreciation

and amortization (1,463,402) (1,441,931)

Property and equipment, net $ 61,222 $ 31,507





11

5. Operating Lease

The Association has a two year lease on its facilities which expires June 30, 2013. Rent expense was $99,220 and $95,998 for the years ended June 30, 2012 and 2011, respectively. Future minimum lease payments under this non-cancelable operating lease amount to $100,183 for the year ended June 30, 2013.

The Association receives rent-free rehearsal space for the Jacksonville Symphony Youth Orchestra as a contribution from an unrelated party. The Association recognized $338,043 and $323,580 for such facilities in the combined statements of activities as both revenue and an expense accordance with authoritative guidance for each of the years ended June 30, 2012 and 2011. These amounts are includedas in-kind production expense in Note 8.

6. Investments

The Association’s Endowment Fund investments consisted of the following at June 30, 2012:

Cost MarketMoney market funds:

SunTrust $ 294,509 $ 294,509EverBank 100,769 100,769Bank of America 78,641 78,641Wells Fargo 22,749 22,749Regions 15,511 15,511Merrill Lynch 10,270 10,270

Certificate of deposit - SunTrust 1,233,499 1,233,499Federal Farm Credit Bank bonds 50,185 51,633U.S. Treasury bonds 228,839 294,563Mutual funds - fixed income 1,150,611 1,146,760Corporate bonds 1,473,188 1,722,499Corporate stock 1,507,350 2,521,055

Total investments $ 6,166,121 $ 7,492,458

The Foundation Fund investments consisted of the following at June 30, 2012:

Cost Market

Money market funds - Wells Fargo $ 5,538 $ 5,538Mutual funds - fixed income 50,000 50,000Closed end funds 49,545 77,595Corporate stock 149,729 172,323Lone Pine Capital, LLC 490,305 2,808,404Semper Vic Partners, L.P. 1,475,000 3,690,599






12

6. Investments (Continued)

The Association’s Endowment Fund investments consisted of the following at June 30, 2011:

Cost MarketMoney market funds:

SunTrust $ 382,256 $ 382,256Merrill Lynch 89,289 89,289Wells Fargo 27,204 27,204Regions 15,478 15,478

Certificate of deposit - SunTrust 1,230,372 1,230,372Federal Farm Credit Bank bonds 50,185 53,281U.S. Treasury notes 148,689 153,492U.S. Treasury bonds 228,839 274,277Corporate bonds 1,558,452 1,769,571Corporate stock 1,147,649 2,015,372Mutual funds - fixed income 1,424,770 1,429,949


The Foundation Fund investments consisted of the following at June 30, 2011:

Cost Market

Money market funds - Wells Fargo $ 23,978 $ 23,978Closed end funds 69,305 102,201Corporate stock 491,644 569,068Lone Pine Capital, LLC 490,305 2,577,806Semper Vic Partners, L.P. 1,475,000 3,294,811


Lone Pine Capital, LLC’s investment objective is to provide investors with compound annual long-term returns that are superior to the broad market averages while having less risk than the overall stock market. To accomplish this, the partnership invests primarily in public equity securities of U.S. and non-U.S. issuers. The partnership also invests (no more than 5% of partners' capital) in private placement securities, may utilize both over-the-counter and exchange traded instruments (including derivative instruments such as options, swaps, and futures on equities and equity indices and other equity derivatives), invest in other funds and invest in the high yield and convertible fixed income markets. The partnership does not engage in speculative trading in the interest rate, currency or physical commodities markets.

Semper Vic Partners, L.P., is a limited partnership whose purpose is to serve as a fund through which the assets of its partners may be utilized in investing, holding and trading in securities, other financial instruments and rights and options relating thereto.





13

7. Fair Value Measurements

Authoritative guidance provides the framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under authoritative guidance are described as follows:

Level 1 Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Symphony has the ability to access.

Level 2 Inputs to the valuation methodology include: quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; inputs other than quoted prices that are observable for the asset or liability; inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

Level 3 Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.

There have been no changes in the methodologies used at June 30, 2012 and 2011. Following is a description of the valuation methodologies used for assets measured at fair value:

Mutual funds, money market funds and closed end funds: Valued at the net asset value of the units reported on the active market on which the individual securities are traded.

Corporate stock: Valued at the closing price reported on the active market on which the individual securities are traded.

Certificates of deposit: Valued using a third party data service’s specialized certificate of deposit values.

Corporate bonds: Valued using matrix pricing. Matrix pricing is a mathematical technique used without relying exclusively on quoted prices for the specific investments, but rather on the investments’ relationship to other benchmark quoted investments.

Government bonds and notes: Valued using a third party data pricing service.

Private investment partnership: Values of the securities and assets held are determined based on the last sales price, or the last current bid quotation, as applicable. Valuations of assets for which market quotations are not readily available are determined at the discretion of the investment manager.





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7. Fair Value Measurements (Continued)

The preceding methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although the Symphony believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

The following table sets forth by level, within the fair value hierarchy, the Symphony’s financial instruments at fair value at June 30, 2012:

Level 1 Level 2 Level 3 Total

Mutual funds - fixed income $ 1,196,760 $ - $ - $ 1,196,760Closed end funds 77,595 - - 77,595Corporate stocks:

Basic materials 29,106 - - 29,106Consumer goods 168,232 - - 168,232Consumer services 36,428 - - 36,428Financials 2,230,938 - - 2,230,938Industrials 61,729 - - 61,729Oil and gas 93,665 - - 93,665Technology 73,280 - - 73,280

Certificates of deposit 1,233,499 - - 1,233,499Money market funds 527,987 - - 527,987U.S. Treasury notes - 51,633 - 51,633U.S. Treasury bonds - 294,563 - 294,563Corporate bonds - 1,722,499 - 1,722,499Private investment partnerships - - 6,499,003 6,499,003

Total assets at fair value $ 5,729,219 $ 2,068,695 $ 6,499,003 $ 14,296,917

Level 3 Gains and Losses

The following table sets forth a summary of changes in the fair value of the Symphony’s level 3 assets for the year ended June 30, 2012:

Private InvestmentPartnerships

Balance, beginning of year $ 5,872,617Management fees (25,277)Realized and unrealized gains 651,663

Balance, end of year $ 6,499,003





15

7. Fair Value Measurements (Continued)

The following table sets forth by level, within the fair value hierarchy, the Symphony’s financial instruments at fair value at June 30, 2011:

Level 1 Level 2 Level 3 Total

Mutual funds - fixed income $ 1,429,949 $ - $ - $ 1,429,949Closed end funds 102,201 - - 102,201Corporate stocks:

Basic materials 32,382 - - 32,382Consumer goods 136,648 - - 136,648Consumer services 82,778 - - 82,778Financials 2,102,765 - - 2,102,765Industrials 39,330 - - 39,330Oil and gas 140,732 - - 140,732Technology 49,805 - - 49,805

Certificates of deposit 1,230,372 - - 1,230,372Money market funds 538,205 - - 538,205U.S. Treasury notes 153,492 - - 153,492Federal farm credit bank bonds - 53,281 - 53,281U.S. Treasury bonds - 274,277 - 274,277Corporate bonds - 1,769,571 - 1,769,571Private investment partnerships - - 5,872,617 5,872,617

Total assets at fair value $ 6,038,659 $ 2,097,129 $ 5,872,617 $ 14,008,405

Level 3 Gains and Losses

The following table sets forth a summary of changes in the fair value of the Symphony’s level 3 assets for the year ended June 30, 2011:

Private InvestmentPartnerships

Balance, beginning of year $ 4,745,444Management fees (25,527)Sale of investment shares (267,000)Realized and unrealized gains 1,419,700

Balance, end of year $ 5,872,617

There were no transfers between Level 1, Level 2 or Level 3 investments during the years ended June 30, 2012 and 2011.





16

8. Contributions

Contributions to the Operating Fund include the following in-kind amounts for the years ended June 30:

2012 2011

Production expenses $ 380,043 $ 325,562Fundraising activities 16,176 6,102Advertising and promotions - 4,500

$ 396,219 $ 336,164

Contributions receivable consisted of the following at June 30:

2012 2011Unconditional promises expected to be collected in:

Less than one year $ 792,746 $ 548,583Between one to five years 579,500 200,500

Total contributions 1,372,246 749,083Less: allowance for uncollectible contributions (35,163) (112,212)Less: discount to present value (19,841) (33,348)

$ 1,317,242 $ 603,523

Contributions have been discounted by an 8% annual rate of interest. Two donors represented 21% and 14% of contributions receivable at June 30, 2012. One donor represented 26% of contributions receivable at June 30, 2011.

9. Grant Programs

City of Jacksonville

Appropriations from the City of Jacksonville Cultural Services Grant Program for 2012 and 2011 are included in the Operating Fund and are maintained in a separate account at SunTrust Bank.

City of Jacksonville Cultural Services Grant – Operating (no grant number)

Receipt of Funds

City FY2011-2012

City FY 2010-2011

Amount of award (per city budget ordinance) $ 323,724 $ 318,861Actual funds received from city in last audit period - (239,146)Actual amount received this period (242,793) (79,715)

Amount remaining to be distributed $ 80,931 $ -





17

9. Grant Programs (Continued)

City FY 2011-2012

Item Budgeted

Actual 10/1/2011 –6/30/2012

Actual 7/1/2012 –9/30/2012 Total Actual

Remaining Balance

Artistic salary expenses $ 323,724 $ 323,724 $ - $ 323,724 $ -

Total $ 323,724 $ 323,724 $ - $ 323,724 $ -

City FY 2010-2011

Item Budgeted

Actual 10/1/2010 –6/30/2011

Actual 7/1/2011 –9/30/2011 Total Actual

Remaining Balance

Artistic salary expenses $ 318,861 $ 318,861 $ - $ 318,861 $ -

Total $ 318,861 $ 318,861 $ - $ 318,861 $ -

State of Florida

Appropriations from the State of Florida, Division of Cultural Affairs are included in the Operating Fund. The total grant awards of $18,306 and $7,242 were expended toward guest artist fees during the years ended June 30, 2012 and 2011, respectively.

Other

Other federal, state and local grant revenues were $47,500 for each of the years ended June 30, 2012and 2011.

10. Commitments

The Symphony entered into a collective bargaining agreement beginning January 16, 2008, with its Full and Core Orchestra musicians, which represents 100% of the Symphony's musician labor force. This contract terminated on August 31, 2012. As of the date of this report the musician labor force and Symphony management are in ongoing negotiations.

11. Fine Arts Investments

The Association has three endowment programs (Fine Arts I, Fine Arts II and Fine Arts III) with assets held at Wells Fargo that received matching funds from the State. The Association contributed $360,000 and the State matched $240,000 in each case. The Association is required, at all times, to maintain the $600,000 for each award in these separate accounts. If the funds fall below $600,000 the Association would be required to refund the State portion.





18

11. Fine Arts Investments (Continued)

These accounts consisted of the following, and are included in Board designated net assets, at June 30:

2012

Fine Arts 1 Fine Arts 2 Fine Arts 3

Cost Market Cost Market Cost Market

Money market funds $ 15,821 $ 15,821 $ 14,978 $ 14,978 $ 2,956 $ 2,956

Corporate bonds 176,857 179,929 151,919 153,015 - -Mutual funds -

fixed income 296,933 296,451 296,525 295,978 470,995 468,759

Corporate stocks 178,109 208,519 212,452 227,589 200,472 196,017

Total $ 667,720 $ 700,720 $ 675,874 $ 691,560 $ 674,423 $ 667,732

2011

Fine Arts 1 Fine Arts 2 Fine Arts 3

Cost Market Cost Market Cost Market

Money market funds $ 1,574 $ 1,574 $ 974 $ 974 $ 1,881 $ 1,881

U.S. Treasury notes - - - - 98,076 103,184

Corporate bonds 176,857 185,979 151,919 159,156 - -Mutual funds -

fixed income 411,921 413,364 433,499 435,794 494,987 496,259

Corporate stocks 65,940 65,008 65,155 64,234 65,155 64,234

Total $ 656,292 $ 665,925 $ 651,547 $ 660,158 $ 660,099 $ 665,558

12. Restrictions and Limitations on Net Asset Balances

Temporarily restricted net assets consisted of gifts and other unexpended revenues and gains available for Operating Fund Program services of $1,401,160 and $1,557,657 at June 30, 2012 and 2011,respectively.

13. Transfers

Net Assets Released From Temporary Restrictions

Net assets are released from temporary restrictions through the occurrence of expenses satisfying the restricted purposes or by occurrence of events specified by the donors and are summarized as follows for the years ended June 30:

2012 2011

Utilization of time restricted contributions $ 3,242,185 $ 3,134,997Utilization of purpose restricted contributions 1,253,105 1,219,135

Net assets released from temporary restrictions $ 4,495,290 $ 4,354,132





19

13. Transfers (Continued)

Net Assets Released from Board Designated

The Symphony Board of Directors approved releases of Board designated net assets to undesignated net assets as follows for the years ended June 30:

2012 2011

Bridge Fund $ 150,000 $ 317,000Foundation Fund* 328,393 266,098Endowment Fund* 374,202 378,008Total release of Board

designated net assets $ 852,595 $ 961,106

*These transfers to the Association’s Operating Fund are consistent with the Association’s "Endowment Investment and Spending Policy."

SUPPLEMENTAL SCHEDULES

Operating Fund Bridge Fund Guild FundAssets:

Cash and cash equivalents -$ -$ 178,208$ Contributions receivable, net 1,146,856 27,302 - Due (to) from other funds (107,226) 155,540 - Other receivables and accrued interest 116,983 - - Investments - - - Property and equipment, net 61,222 - -

Other assets 264,683 - -

Total assets 1,482,518$ 182,842$ 178,208$


Accounts payable and accrued liabilities 351,655$ -$ 400$

Deferred revenue - concert ticket sales and sponsorships 1,244,013 - 5,020

Line of credit 1,787,789 - - Total liabilities 3,383,457 - 5,420 Net assets (1,900,939) 182,842 172,788

Total liabilities and net assets 1,482,518$ 182,842$ 178,208$

JACKSONVILLE SYMPHONY ASSOCIATIONAND JACKSONVILLE SYMPHONY FOUNDATIONCOMBINING SCHEDULE OF FINANCIAL POSITION

JUNE 30, 2012

Jacksonville JacksonvilleSymphony Symphony

Association Total Foundation Total

-$ 178,208$ -$ 178,208$

143,084 1,317,242 - 1,317,242

(48,314) - - -

31,923 148,906 32 148,938

7,492,458 7,492,458 6,804,459 14,296,917

- 61,222 - 61,222

- 264,683 - 264,683

7,619,151$ 9,462,719$ 6,804,491$ 16,267,210$

-$ 352,055$ -$ 352,055$

- 1,249,033 - 1,249,033 - 1,787,789 - 1,787,789

- 3,388,877 - 3,388,877 7,619,151 6,073,842 6,804,491 12,878,333

7,619,151$ 9,462,719$ 6,804,491$ 16,267,210$

Endowment

Fund

20

Operating Fund Bridge Fund Guild FundAssets:

Cash and cash equivalents 5,829$ -$ 172,694$ Contributions receivable, net 376,644 54,394 - Due (to) from other funds (1,029,726) 1,078,040 - Other receivables and accrued interest 194,706 - 17,036 Investments - - - Property and equipment, net 31,507 - -

Other assets 220,324 - 584

Total assets (200,716)$ 1,132,434$ 190,314$


Accounts payable and accrued liabilities 265,847$ -$ -$

Deferred revenue - concert ticket sales and sponsorships 1,146,584 - 8,455

Line of Credit 468,611 - - Total liabilities 1,881,042 - 8,455 Net assets (2,081,758) 1,132,434 181,859

Total liabilities and net assets (200,716)$ 1,132,434$ 190,314$

JACKSONVILLE SYMPHONY ASSOCIATIONAND JACKSONVILLE SYMPHONY FOUNDATIONCOMBINING SCHEDULE OF FINANCIAL POSITION

JUNE 30, 2011

Jacksonville JacksonvilleSymphony Symphony

Endowment Fund Association Total Foundation Total

-$ 178,523$ -$ 178,523$

172,485 603,523 - 603,523

(48,314) - - -

34,383 246,125 - 246,125

7,440,541 7,440,541 6,567,864 14,008,405

- 31,507 - 31,507 - 220,908 - 220,908

7,599,095$ 8,721,127$ 6,567,864$ 15,288,991$

-$ 265,847$ 2,060$ 267,907$

- 1,155,039 - 1,155,039 - 468,611 - 468,611

- 1,889,497 2,060 1,891,557 7,599,095 6,831,630 6,565,804 13,397,434

7,599,095$ 8,721,127$ 6,567,864$ 15,288,991$

21

Operating Fund Guild Fund Endowment Fund Bridge Fund Revenue, gains and other support:

Ticket sales and concert fees 2,796,517$ -$ -$ -$ Contributions 3,946,355 - 15,599 8,500Grants 389,530 - - - Advertising 105,640 - - - Fund raising activities 110,985 156,386 - - Interest income - 3,584 145,067 - Gain on sale of investments - - 60,638 - Unrealized investment gain - - 181,302 - Other revenue 134,983 - - -

Total revenue, gains and other support 7,484,010 159,970 402,606 8,500

Transfers from guild fund 62,068 (62,068) - - Transfers from future year annual fund (675,660) - - - Transfers from foundation 328,393 - (4,273) - Transfers from endowment fund 374,202 - (374,202) -

Expenses:Musical productions:

Salaries and benefits 4,471,163 - - - Advertising and promotion 984,980 - - - Production expenses 1,326,033 - - - Guest artist fees 700,405 - - -

Total musical productions 7,482,581 - - -

Supporting activities:Interest expense 14,434 - - - Fund raising activities 197,707 106,973 - - Administrative salaries and benefits 1,093,928 - - - General and administrative expenses 240,204 - 4,075 -

Total supporting activities 1,546,273 106,973 4,075 -

Total expenses 9,028,854 106,973 4,075 -

Change in net assets before non-recurring transactions (1,455,841) (9,071) 20,056 8,500

Release from temporarily restricted toboard designated bridge fund - - - 24,065

Release from board designatedbridge fund for budget shortfall 150,000 - - (150,000)

Release from temporarily restricted bridge fund for budget shortfall 811,000 - - -

Change in net assets (494,841) (9,071) 20,056 (117,435)

Net assets, beginning of year (2,807,258) 181,859 7,599,095 300,277

Net assets, end of year (3,302,099)$ 172,788$ 7,619,151$ 182,842$

Undesignated

JACKSONVILLE SYMPHONY ASSOCIATIONAND JACKSONVILLE SYMPHONY FOUNDATION

COMBINING SCHEDULE OF ACTIVITIESYEAR ENDED JUNE 30, 2012

Board Designated

Jacksonville JacksonvilleFuture Year(s) Symphony Symphony

Bridge Fund Annual Fund Association Total Foundation Total

-$ -$ 2,796,517$ -$ 2,796,517$

2,908 - 3,973,362 - 3,973,362

- - 389,530 - 389,530

- - 105,640 - 105,640

- - 267,371 - 267,371

- - 148,651 4,939 153,590

- - 60,638 243,544 304,182

- - 181,302 341,286 522,588

- - 134,983 - 134,983

2,908 - 8,057,994 589,769 8,647,763

- - - - -

- 675,660 - - -

- - 324,120 (324,120) -

- - - - -

- - 4,471,163 - 4,471,163

- - 984,980 - 984,980

- - 1,326,033 - 1,326,033

- - 700,405 - 700,405

- - 7,482,581 - 7,482,581

- - 14,434 - 14,434

- - 304,680 - 304,680

- - 1,093,928 - 1,093,928

- - 244,279 26,962 271,241

- - 1,657,321 26,962 1,684,283

- - 9,139,902 26,962 9,166,864

2,908 675,660 (757,788) 238,687 (519,101)

(24,065) - - - -

- - - - -

(811,000) - - - -

(832,157) 675,660 (757,788) 238,687 (519,101)

832,157 725,500 6,831,630 6,565,804 13,397,434

-$ 1,401,160$ 6,073,842$ 6,804,491$ 12,878,333$

Temporarily Restricted

22

Operating Fund Organ Fund Guild Fund Endowment FundRevenue, gains and other support:

Ticket sales and concert fees 2,364,481$ -$ -$ -$ Contributions 3,959,847 - - - Grants 373,603 - - - Advertising 103,171 - - - Fund raising activities 59,460 - 234,731 - Interest income - - 17,398 197,519Gain on sale of investments - - - 44,826 Unrealized investment (loss) gain - - - (1,861) Other revenue 121,098 - - -

Total revenue, gains and other support 6,981,660 - 252,129 240,484

Transfers from guild fund 11,025 (11,025) - - Transfers from guild fund 102,557 - (102,557) - Transfers from future year annual fund 20,682 - - - Transfers from foundation 266,098 - - - Transfers from endowment fund 378,008 - - (378,008)

Expenses:Musical productions:

Salaries and benefits 4,221,348 - - - Advertising and promotion 1,028,383 - - - Production expenses 1,082,251 - - - Guest artist fees 584,048 - - -

Total musical productions 6,916,030 - - -

Supporting activities:Interest expense 7,361 - - - Fund raising activities 148,606 - 130,468 68,744 Administrative salaries and benefits 1,089,719 - - - General and administrative expenses 254,758 - - 1,057

Total supporting activities 1,500,444 - 130,468 69,801 Total expenses 8,416,474 - 130,468 69,801

Change in net assets before non-recurringtransactions (656,444) (11,025) 19,104 (207,325)

Release from bridge fund for specialmarketing initiatives, budget shortfall 317,000 - - -

Change in net assets (339,444) (11,025) 19,104 (207,325)

Net assets, beginning of year (2,467,814) 11,025 162,755 7,806,420

Net assets, end of year (2,807,258)$ -$ 181,859$ 7,599,095$

Undesignated

JACKSONVILLE SYMPHONY ASSOCIATIONAND JACKSONVILLE SYMPHONY FOUNDATION

COMBINING SCHEDULE OF ACTIVITIESYEAR ENDED JUNE 30, 2011

Board Designated

Board DesignatedJacksonville Jacksonville

Future Year(s) Symphony SymphonyBridge Fund Bridge Fund Annual Fund Association Total Foundation Total

-$ -$ - 2,364,481$ -$ 2,364,481$

381,765 1,880 - 4,343,492 - 4,343,492

- - - 373,603 - 373,603

- - - 103,171 - 103,171

- - - 294,191 - 294,191

- - - 214,917 6,806 221,723

- - - 44,826 421,970 466,796

- - - (1,861) 1,111,834 1,109,973

- - - 121,098 - 121,098

381,765 1,880 - 7,857,918 1,540,610 9,398,528

- - - - - -

- - - - - -

- - (20,682) - - -

- - - 266,098 (266,098) -

- - - - - -

- - - 4,221,348 - 4,221,348

- - - 1,028,383 - 1,028,383

- - - 1,082,251 - 1,082,251

- - - 584,048 - 584,048

- - - 6,916,030 - 6,916,030

- - - 7,361 - 7,361

- - - 347,818 - 347,818

- - - 1,089,719 - 1,089,719

- - - 255,815 29,639 285,454

- - - 1,700,713 29,639 1,730,352

- - - 8,616,743 29,639 8,646,382

381,765 1,880 (20,682) (492,727) 1,244,873 752,146

(317,000) - - - - -

64,765 1,880 (20,682) (492,727) 1,244,873 752,146

235,512 830,277 746,182 7,324,357 5,320,931 12,645,288

300,277$ 832,157$ 725,500$ 6,831,630$ 6,565,804$ 13,397,434$

Temporarily Restricted Net Assets

23

24

Report on Internal Control Over Financial Reportingand on Compliance and Other Matters Based on an Audit of Financial

Statements Performed in Accordance with Government Auditing Standards

To the Board of Directors ofJacksonville Symphony Association

and Jacksonville Symphony FoundationJacksonville, Florida

We have audited the combed financial statements of Jacksonville Symphony Association and Jacksonville Symphony Foundation (collectively the "Symphony") as of and for the year ended June 30, 2012, and have issued our report thereon dated October 8, 2012. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.

Internal Control Over Financial Reporting

Management of the Symphony is responsible for establishing and maintaining effective internal control over financial reporting. In planning and performing our audit, we considered the Symphony’s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Symphony’s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Symphony’s internal control over financial reporting.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis.

Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above.


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25

Compliance and Other Matters

As part of obtaining reasonable assurance about whether the Symphony’s combined financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of combined financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

This report is intended solely for the information and use of management, others within the entity, the Board of Trustees, and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.

October 8, 2012

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26

Report of Independent Certified Public Accountants onthe Management Assertion Report

To the Board of Directors ofJacksonville Symphony AssociationJacksonville, Florida

We have examined management’s assertion, included in the accompanying Management Assertion Report, that the Jacksonville Symphony Association (the “Association”) complied with the allowable cost requirements established in the grant agreements applicable to grant expenditures identified on the Schedule of State Financial Assistance for the year ended June 30, 2012. Management is responsible for the Association’s compliance with those requirements. Our responsibility is to express an opinion on management’s assertion about the Association’s compliance based on our examination.

Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about the Association’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the Association’s compliance with specified requirements.

In our opinion, management’s assertion that the Association complied with the aforementioned requirements during the year ended June 30, 2012 is fairly stated, in all material respects.

October 8, 2012


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SCHEDULE OF STATE FINANCIAL ASSISTANCE


28

State Agency and Program Title

State Contract/Grant

Number Expenditures

Florida Department of State, Division of Cultural Affairs:General Program Support Grant 12.6.0109 $ 18,306

Documents

Fiscal Year 2011-2012