FINANCIAL STATEMENTS AND
REPORT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
A WIDER CIRCLE, INC.
December 31, 2012 and 2011
A Wider Circle, Inc.
TABLE OF CONTENTS
Page
Independent Auditors' Report
1
Financial Statements:
Statements of Financial Position
2
Statements of Activities
3
Statements of Functional Expenses
5
Statements of Cash Flows
7
Notes to Financial Statements
8
Farmer & First, P.C.
CERTIFIED PUBLIC ACCOUNTANTS
“Grow Your Business With Us”
INDEPENDENT AUDITORS' REPORT
June 3, 2013
Board of Directors
A Wider Circle, Inc.
Silver Spring, Maryland
We have audited the accompanying statements of financial position of A Wider
Circle, Inc. (a nonprofit corporation), as of December 31, 2012 and 2011 and the
related statements of activities, functional expenses 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 the 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 we plan and perform the
audits 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 A Wider Circle, Inc. as of December 31, 2012 and
2011, and the changes in net assets and its cash flows for the years then ended in
conformity with accounting principles generally accepted in the United States of
America.
Warren, RI
-1Six State Street, Warren, RI 02885
(401) 247-1040 Phone • (401) 247-1049 Fax
9031 Ottawa Place, Silver Spring, MD 20910
(877) 266-9942 Toll Free • www.farmerfirstcpas.com
A Wider Circle, Inc.
STATEMENTS OF FINANCIAL POSITION
As of December 31,
2012
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
Certificate of deposits
Accrued interest receivable
Investment in marketable securities
Grants receivable and promises to give
Inventory of donated clothes and household furniture
Prepaid expenses
Total current assets
$
PROPERTY AND EQUIPMENT:
Leasehold improvements
Furniture, fixtures and equipment
Truck
Less: accumulated depreciation
Property and equipment, net
OTHER ASSETS
Grants receivable, net of current portion
Deposits
Total other assets
TOTAL
As Restated
2011
$
524,310
160,217
27
1,091
111,473
40,782
31,231
869,131
$
469,759
159,378
38
74,750
27,570
10,909
742,404
161,454
38,350
137,743
337,547
71,913
265,634
86,454
27,721
96,897
211,072
44,115
166,957
10,000
5,258
15,258
50,000
4,258
54,258
1,150,023
The accompanying notes are an integral part of these statements.
-2-
$
963,619
A Wider Circle, Inc.
STATEMENTS OF FINANCIAL POSITION (continued)
As of December 31,
2012
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES:
Accounts payable - trade
Construction payable
Total current liabilities
$
NET ASSETS:
Temporarily restricted
Unrestricted
Total net assets
TOTAL
As Restated
2011
16,133
75,000
91,133
$
26,631
1,032,259
1,058,890
$
1,150,023
The accompanying notes are an integral part of these statements.
-3-
37,544
37,544
66,679
859,396
926,075
$
963,619
A Wider Circle, Inc.
STATEMENT OF ACTIVITIES
For the Year Ended December 31, 2012
Unrestricted
Temporarily
Restricted
Total
SUPPORT & REVENUE:
Grants and contribution income
$
875,819 $
70,000 $
945,819
Government grant income
123,108
-
123,108
Special event revenue, net of expenses
185,599
-
185,599
In-kind support
5,126,554
-
5,126,554
Interest income
1,119
-
1,119
(331)
-
(331)
22
-
22
9,000
-
9,000
Loss on sale of marketable securities
Unrealized gain on marketable securities
Rental income
Other income
Net assets released from restrictions
Total unrestricted support and reclassifications
6,420
110,048
(110,048)
6,420
-
6,437,358
(40,048)
6,397,310
6,162,545
-
6,162,545
36,638
65,312
-
36,638
65,312
6,264,495
-
6,264,495
EXPENSES:
Program services
Supporting services:
Management and general
Fundraising
Net expenses
Change in net assets
172,863
(40,048)
132,815
Net assets, January 1, 2012
859,396
66,679
926,075
Net assets, December 31, 2012
$
1,032,259 $
26,631
The accompanying notes are an integral part of these statements.
-4-
$
1,058,890
A Wider Circle, Inc.
STATEMENT OF ACTIVITIES - AS RESTATED
For the Year Ended December 31, 2011
Unrestricted
Temporarily
Restricted
Total
SUPPORT & REVENUE:
Grants and contribution income
$
843,249 $
5,000 $
848,249
Government grant income
209,276
-
209,276
Special event revenue, net of expenses
115,393
-
115,393
In-kind support
3,649,199
-
3,649,199
Interest income
1,722
-
1,722
Loss on sale of marketable securities
(143)
-
(143)
Other income
Net assets released from restrictions
2,058
210,384
(210,384)
2,058
-
5,031,138
(205,384)
4,825,754
Total unrestricted support and reclassifications
EXPENSES:
Program services
4,535,632
-
4,535,632
28,318
93,064
-
28,318
93,064
4,657,014
-
4,657,014
Supporting services:
Management and general
Fundraising
Net expenses
Change in net assets
374,124
(205,384)
168,740
Net assets, January 1, 2011
485,272
272,063
757,335
Net assets, December 31, 2011
$
859,396 $
66,679 $
The accompanying notes are an integral part of these statements.
-5-
926,075
A Wider Circle, Inc.
STATEMENT OF FUNCTIONAL EXPENSES
For the Year Ended December 31, 2012
Supporting Services
Program
Services
Salaries
Payroll taxes
Benefits
Total payroll-related costs
$
Furniture and household supplies
Rent & occupancy expenses
Community outreach and supplies
Printing and reproduction
Depreciation
Fees
Telephone
Insurance
Postage and delivery
Legal and accounting
Technology, internet & web expenses
Dues and membership
Travel
Staff development
Miscellaneous
Totals
653,471 $
61,315
3,848
718,634
4,961,632
305,129
86,817
11,579
20,915
14,685
15,212
12,744
6,321
2,000
4,115
1,117
824
153
668
$
6,162,545 $
Mgmt &
General
13,474 $
1,264
79
14,817
4,660
1,134
261
6,835
338
838
3,186
123
3,900
500
31
2
8
5
36,638 $
FundRaising
12,306
1,155
73
13,534
Total
Support
$
1,580
11,594
23,271
49
5,326
335
8,707
742
12
157
3
2
65,312
25,780
2,419
152
28,351
Functional
Expenses
$
6,240
12,728
23,532
6,884
5,664
1,173
3,186
8,830
3,900
1,242
43
159
11
7
$
101,950
The accompanying notes are an integral part of these statements.
-6-
679,251
63,734
4,000
746,985
4,961,632
311,369
99,545
35,111
27,799
20,349
16,385
15,930
15,151
5,900
5,357
1,160
983
164
675
$
6,264,495
A Wider Circle, Inc.
STATEMENT OF FUNCTIONAL EXPENSES - AS RESTATED
For the Year Ended December 31, 2011
Supporting Services
Program
Services
Salaries
Payroll taxes
Benefits
Total payroll-related costs
$
Furniture and household supplies
Rent & occupancy expenses
Project expenses
Community outreach and supplies
Fees
Professional fees
Printing and reproduction
Depreciation
Insurance
Postage and delivery
Legal and accounting
Telephone
Technology, internet & web expenses
Dues and membership
Emergency assistance
Travel
Staff development
Miscellaneous
Totals
480,986
44,238
4,913
530,137
Mgmt &
General
$
3,354,336
253,347
206,771
60,311
12,777
37,084
16,832
15,049
11,818
6,210
5,950
10,486
9,602
1,229
1,162
264
338
1,929
$
4,535,632 $
FundRaising
7,933 $
730
81
8,744
28,741
2,643
294
31,678
3,688
500
350
393
4,918
2,955
122
4,650
578
439
29
8
944
1,295
8,896
26,670
17,630
35
5,212
700
231
531
12
174
-
28,318 $
93,064
Total
Support
$
36,674
3,373
375
40,422
Functional
Expenses
$
4,983
9,396
27,020
18,023
4,953
2,955
5,334
5,350
809
970
41
182
944
$
121,382
The accompanying notes are an integral part of these statements.
-7-
517,660
47,611
5,288
570,559
3,354,336
258,330
206,771
69,707
39,797
37,084
34,855
20,002
14,773
11,544
11,300
11,295
10,572
1,270
1,162
446
338
2,873
$
4,657,014
A Wider Circle, Inc.
STATEMENTS OF CASH FLOWS
For the Years Ended December 31,
CASH FLOWS FROM OPERATING ACTIVITIES:
Change in net assets
Adjustments to reconcile change in net assets to net
cash provided by operating activities:
Depreciation and amortization
Non-cash contributions
Contribution of marketable securities
Realized loss on sale of marketable securities
Unrealized (gain) on marketable securities
Decrease (increase) in operating assets:
Prepaid expenses
Grants receivable and promises to give
Accrued interest receivable
Deposits
Increase (decrease) in operating liabilities:
Accounts payable - trade
As Restated
2011
2012
$
132,815
$
168,740
27,798
(13,212)
(11,654)
331
(22)
20,003
(107,570)
-
(20,342)
3,277
9
(1,000)
3,710
108,240
33
(270)
(21,411)
(1,051)
96,589
191,835
(51,475)
10,276
(839)
(45,847)
(1,654)
(42,038)
(47,501)
NET INCREASE IN CASH AND
CASH EQUIVALENTS
54,551
144,334
Cash and cash equivalents, January 1
469,759
325,425
Net cash provided by operating activities
CASH FLOWS USED BY INVESTING ACTIVITIES:
Purchases of property and equipment
Proceeds from sale of marketable securities
Net purchase of certificate of deposit
Net cash provided used by investing activities
Cash and cash equivalents, December 31
$
524,310
The accompanying notes are an integral part of these statements.
-8-
$
469,759
A Wider Circle, Inc.
NOTES TO FINANCIAL STATEMENTS
December 31, 2012 and 2011
NOTE A - ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES
1.
Nature of Activities
A Wider Circle, Inc. (a non-profit organization), was incorporated in the state of
Maryland on October 1, 2001. The Organization's mission is to help children and
adults lift themselves out of poverty. Each day, A Wider Circle provides basic need
items to families transitioning out of shelters or simply living without life's necessities.
The Organization furnishes the homes of more than 1,000 children and adults every
single month, all free of charge. The Organization also goes into low-income schools
and shelters to lead educational workshops on topics ranging from job skills and
financial planning to stress management, nutrition, and healthy parenting.
2.
Basis of Accounting
The Organization recognizes income on the accrual method of accounting in
accordance with accounting principles generally accepted in the United States of
America.
3.
Basis of Presentation
The financial statements are presented in accordance with FASB Accounting Standard
Codification (FASB ASC) 958, Not-for-Profit Entities. Under FASB ASC 958, the
Organization is required to report information regarding its financial position and
activities according to three classes of net assets: unrestricted, temporarily restricted
and permanently restricted. The Organization had no permanently restricted net
assets as of December 31, 2012 and 2011.
4.
Cash and Cash Equivalents
For purposes of the statements of financial position and cash flows, the Organization
considers all unrestricted highly liquid investments, with an initial maturity of three
months or less, to be considered cash.
-9-
A Wider Circle, Inc.
NOTES TO FINANCIAL STATEMENTS
December 31, 2012 and 2011
NOTE A - ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES
(continued)
5.
Property and Equipment
Property and equipment are stated at cost. Depreciation is calculated for financial
statement purposes using the straight-line method based on the property's estimated
life.
Additions and improvements that add materially to productive capacity, or extend the
life of an asset, are capitalized. Normal repairs and maintenance are charged against
income. When facilities are retired or sold, their cost and accumulated depreciation
are removed from the accounts and related gains or losses are included in income. In
case of trade items, any remaining book value increases the basis of the new
acquisitions.
Donations of property and equipment are recorded as support at their estimated fair
value. Such donations are reported as unrestricted support unless the donor has
restricted the donated asset to a specific purpose. The estimated lives used in
determining depreciation are:
Leasehold improvements
Furniture and fixtures
Computer equipment
Truck
6.
5 – 20 years
3 – 10 years
5 years
7 years
Income Taxes
The Organization is a not-for-profit organization that is generally exempt from
income taxes under Section 501(c)(3) of the Internal Revenue Code. In addition, the
Organization has been classified as an organization that is not a private foundation
under Section 590(a)(1). Income that is not related to exempt purposes, less
applicable deductions, is subject to Federal and state corporate income taxes. The
Organization did not have any unrelated business income for the years ended
December 31, 2012 and 2011.
-10-
A Wider Circle, Inc.
NOTES TO FINANCIAL STATEMENTS
December 31, 2012 and 2011
NOTE A - ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES
(continued)
7.
Donated Material and Contributed Services
During the years ended December 31, 2012 and 2011, the Organization was a
recipient of various pieces of furniture and household supplies to hand out to various
families in need in the amount of $4,974,844 and $3,381,906, respectively.
Additionally, the Organization received 6,000 square feet of storage space in 2012 and
2011 valued in the amount of $148,210 and $143,893, respectively, donated computer
consultant services in 2011 in the amount of $36,400, and legal and professional
services in 2012 and 2011 in the amounts of $3,500 and $7,000, respectively.
Additionally, in 2011, a local construction company donated its construction staff
valued at the amount of $80,000 to construct leasehold improvements at the
Organization’s location.
Numerous other unpaid volunteers have made significant contributions of their time
to the management of the Organization and to the delivery of its program services.
The value of this donated time is not determinable and, as such, is not reflected in
these financial statements. The total volunteer time in 2012 and 2011 were
approximately 56,250 and 45,000 hours and intern time was approximately 43,125 and
62,500 hours, respectively.
8.
Restricted and Unrestricted Revenue
Contributions received are recorded as unrestricted, temporarily restricted, or
permanently restricted support, depending on the existence and/or nature of any
donor restrictions. All donor-restricted support is reported as an increase in
temporarily or permanently restricted net assets, depending on the nature of the
restriction. When a restriction expires (that is, when a stipulated time restriction ends
or purpose restriction is accomplished), temporarily restricted net assets are
reclassified to unrestricted net assets and reported in the Statement of Activities as net
assets released from restrictions.
-11-
A Wider Circle, Inc.
NOTES TO FINANCIAL STATEMENTS
December 31, 2012 and 2011
NOTE A - ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES
(continued)
9.
Functional Allocation of Expenses
The costs of providing the various programs and other activities have been
summarized on a functional basis in the Statement of Functional Expenses.
Accordingly, certain costs have been allocated among the programs and supporting
services benefited.
10.
Grants and Contract Awards
The Organization receives grants from private grantors for various purposes. Grants
and contract awards not yet received are accrued. The Organization defers grants and
contract revenues received under approved awards from grantors to the extent they
exceed expenses incurred for the purposes specified under the grant restrictions.
11.
Promises to Give
Unconditional promises to give are recognized as revenue or gains in the period
received and as assets, decreases of liabilities, or expenses depending on the form of
the benefits received. Conditional promises to give are recognized when the
conditions on which they depend are substantially met. All promises to give are due
in less than one year.
12.
Use of Estimates
In preparing financial statements in conformity with accounting principles generally
accepted in the United States of America, management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities at the date of the financial statements,
and the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
-12-
A Wider Circle, Inc.
NOTES TO FINANCIAL STATEMENTS
December 31, 2012 and 2011
NOTE A - ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES
(continued)
13.
Uncertain Tax Provisions
Accounting for uncertain income tax positions, relating to both federal and state
income taxes, are required when a more likely than not threshold is attained. If such
positions result in uncertainties, then the unrecognized tax liability is estimated based
on a cumulative probability assessment that aggregates the estimated tax liability for all
uncertain tax positions. With the adoption of these new rules, the Organization
assessed its tax positions in accordance with the guidance. The Organization has
determined that its tax status as a MD non-profit corporation is its only tax position
and is highly certain. Therefore, these new rules had no impact on the Organization’s
financial statements.
14
Subsequent Events
Management has evaluated subsequent events through June 7, 2013, the date which
the financial statements were available to be issued.
NOTE B – TEMPORARILY RESTRICTED NET ASSETS
Temporarily restricted net assets at the end of the year represent grants that have been
received and designated as temporarily restricted by each respective grantor. As these
funds are expended, the temporary restrictions expire and the temporarily restricted
net assets are reclassified to unrestricted net assets on the statement of activities.
-13-
A Wider Circle, Inc.
NOTES TO FINANCIAL STATEMENTS
December 31, 2012 and 2011
NOTE B – TEMPORARILY RESTRICTED NET ASSETS (continued)
As of December 31 2012 and 2011, temporarily restricted net assets are comprised of
the following funds:
2012
$ 15,000
6,631
5,000
-0-0$ 26,631
Spring Jobs Skills
Truck purchase and on-going expenses
Sponsorships - 2013 Gala
Sibley Plaza beautification project
Neighbor-to-Neighbor
2011
$ -0-0-036,679
30,000
$66,679
NOTE C – CERTIFICATE OF DEPOSIT
The Organization maintains a portion of its operating funds in a secure income
producing investments. As of December 31, 2012 and 2011, these cash investments
of $160,217 and $159,378 respectively, include certificates of deposit stated at cost,
which approximates market value. The certificates of deposit as of December 31,
2012 bear interest at .40% to .50% and mature in 2013.
NOTE D – INVESTMENT IN SECURITIES
The Organization classifies investment in securities as available-for-sale securities. All
securities are carried at their fair market values in the statement of financial position.
Unrealized gains and losses are included in the net assets section of the accompanying
statement of financial position.
As of December 31, 2012, details of the unrealized gains and losses are as follows:
Available-for-sale
securities:
Equity securities
Amortized
Cost
Gross
Unrealized
Gain
Gross
Unrealized
Losses
Fair
Market
Value
$1,070
$21
$ -0-
$1,091
-14-
A Wider Circle, Inc.
NOTES TO FINANCIAL STATEMENTS
December 31, 2012 and 2011
NOTE E – COMMITMENTS
The Organization is obligated under the following rental leases:
Lessor
Location
Term / Exp. Date
Terms
Brookville
LLC
Warehouse 9159 Brookville Rd,
Suite #9159-C
Silver Spring, MD
5 year
September 1, 2013
$3,688/month
thru 9/09, 4%
increase per
year thereafter
Brookville
LLC
Warehouse 9159 Brookville Rd,
Suite #9159-A & B
Silver Spring, MD
2.75 year
September 30, 2013
Brookville
LLC
Warehouse 9153 Brookville Rd
Silver Spring, MD
3 year
$600/month
thru 12/11,
$900/month
thru 9/13.
$2,868/month
thru 9/13, 2%
increase per
year thereafter
The future minimum rental commitments under operating leases as of December 31,
2012 are as follows:
For the year ending December 31, 2013
December 31, 2014
December 31, 2015
$77,200
35,280
26.855
NOTE F – GRANTS INCOME – GOVERNMENT
The organization for the years ended December 31, 2012 and 2011 was awarded
government grant income that covered periods subsequent to December 31, 2012 and
2011. The unearned portion of these grants amounted to $52,327 and $44,674 as of
December 31, 2012 and 2011, respectively.
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A Wider Circle, Inc.
NOTES TO FINANCIAL STATEMENTS
December 31, 2012 and 2011
NOTE G – UNCONDITIONAL PROMISES TO GIVE
Unconditional promises to give are as follows:
2012
2011
Net unconditional promises to give
$ 121,473
$ 124,750
Receivables due in less than one year
Receivables due in one to two years
$ 111,473
10,000
$ 74,750
50,000
Net unconditional promises to give
$ 121,473
$ 124,750
NOTE H – FUNDRAISING ACTIVIES
The Organization conducted fundraising activities during the years ended December
31, 2012 and 2011. Revenue and expenses for the activities are as follows:
2012
$291,875
106,276
$185,599
Total revenue raised
Total expenses
2011
$129,635
14,242
$115,393
NOTE I – RESTATEMENT OF FINANCIAL STATEMENTS
The financial statements as of December 31, 2011 were restated to reflect inventory
of donated clothes and household furniture valued at $27,570. Accordingly, in-kind
support and unrestricted net assets balance was increased by $27,570.
NOTE J – RECLASSIFICATIONS
Certain amounts in the 2011 financial statements have been reclassified to conform to
the 2012 financial statement presentation.
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