THE MICHAEL J. FOX FOUNDATION FOR
PARKINSON'S RESEARCH
CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2014 and 2013
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
The Michael J. Fox Foundation for Parkinson's Research
New York, New York
Report on the Consolidated Financial Statements
We have audited the accompanying consolidated financial statements of The Michael J. Fox Foundation
for Parkinson's Research (the "Foundation"), which comprise the consolidated statements of financial
position as of December 31, 2014 and 2013, the related consolidated statements of activities, functional
expenses, and cash flows for the years then ended, and the related notes to the consolidated financial
statements.
Management's Responsibility for the Consolidated Financial Statements
The Foundation's management is responsible for the preparation and fair presentation of these
consolidated financial statements in accordance with accounting principles generally accepted in the
United States of America; this includes the design, implementation, and maintenance of internal control
relevant to the preparation and fair presentation of financial statements that are free from material
misstatement, whether due to fraud or error.
Auditors' Responsibility
Our responsibility is to express an opinion on these consolidated 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 consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the
organization's preparation and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on
the effectiveness of the organization's internal control. Accordingly, we express no such opinion. An
audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall presentation of
the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Opinion
In our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the financial position of The Michael J. Fox Foundation for Parkinson's Research as of
December 31, 2014 and 2013, and the changes in its net assets and its cash flows for the years then
ended, in accordance with accounting principles generally accepted in the United States of America.
New York, New York
May 5, 2015
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Consolidated Statements of Financial Position
December 31,
2013
2014
ASSETS
Cash and cash equivalents
Investments
Contributions receivable, net
Beneficial interest in trusts
Prepaid expenses and other current assets
Security deposits
Inventory
Property and equipment, net
LIABILITIES AND NET ASSETS
Liabilities:
Accounts payable and accrued expenses
Grants payable, net
Loans payable
Interest payable
Deferred rent
Annuities payable
Deferred revenues
$
97,476,247
1,287,327
15,995,428
267,295
560,555
845,586
40,920
1,107,159
$
93,724,013
1,352,125
23,133,335
273,965
444,287
838,127
52,729
1,602,342
$ 117,580,517
$ 121,420,923
$
$
2,140,662
67,293,865
1,150,196
337,017
644,656
147,448
2,023,706
70,790,386
1,150,196
274,883
719,273
161,088
131,500
71,713,884
75,251,032
26,917,079
18,949,554
28,843,135
17,326,756
45,866,633
46,169,891
$ 117,580,517
$ 121,420,923
Commitments (Note I)
Net assets:
Unrestricted
Temporarily restricted
Total net assets
See notes to consolidated financial statements
2
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Consolidated Statements of Activities
Year Ended December 31,
Unrestricted
2013
Temporarily
Restricted
$ 53,524,940
$ 33,112,419
$ 86,637,359
2,768,307
31,863
665,430
38,583
2,568,863
5,337,170
31,863
665,430
38,583
57,029,123
35,681,282
92,710,405
38,239,039
(38,239,039)
84,330,168
95,268,162
(2,557,757)
75,749,283
2,099,098
6,785,045
75,749,283
2,099,098
6,785,045
76,559,598
1,970,433
6,428,022
76,559,598
1,970,433
6,428,022
Total expenses
84,633,426
84,633,426
84,958,053
84,958,053
Change in net assets
Net assets, beginning of year
(1,926,056)
28,843,135
(303,258)
46,169,891
10,310,109
18,533,026
Unrestricted
Public support and revenue:
Contributions
Special events (net of direct benefit to donors of
$982,009 and $1,055,389 in 2014 and 2013,
respectively)
Investment (loss) income
Rental income
Miscellaneous income
Total public support and revenue before
release of restrictions
Net assets released from restrictions
Total public support and revenue
Expenses:
Program services
Management and general
Fund-raising
Net assets, end of year
See notes to consolidated financial statements
2014
Temporarily
Restricted
$ 31,689,941 $ 46,298,239
3,170,447
(142,997)
429,678
45,677
2,839,183
35,192,746
49,137,422
47,514,624
(47,514,624)
82,707,370
1,622,798
1,622,798
17,326,756
$ 26,917,079 $ 18,949,554
Total
$ 77,988,180
6,009,630
(142,997)
429,678
45,677
84,330,168
$ 45,866,633
$ 28,843,135
(2,557,757)
19,884,513
$ 17,326,756
Total
92,710,405
7,752,352
38,417,539
$ 46,169,891
3
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Consolidated Statements of Functional Expenses
Year Ended December 31,
Program
Services
Grant awards
Salaries and wages
Payroll taxes and employee
benefits
Data processing and bank fees
Professional fees
Recruitment and training costs
Technology
Scientific meetings
Travel and meetings
Postage and delivery
Office supplies and equipment
Advertising and publicity
Insurance
Printing and production
Dues and subscriptions
Occupancy
Depreciation and amortization
Other special events
Interest
$ 63,679,571
4,848,991
2014
Management
and
FundGeneral
Raising
$
883,988
15,276
1,671,983
16,760
257,169
2,061,006
92,031
34,366
134,085
74,932
392,182
70,540
1,185,383
331,020
1,285,398
$ 3,097,310
236,936
23,884
108,757
6,581
38,173
578,943
392,053
382,529
14,949
267,374
8,619
5,657
6,973
393,620
159,992
12,940
91,033
10,250
273,346
22,110
550,633
285,219
252,744
3,702
3,348
1,749
254,724
52,463
62,134
$ 75,749,283
See notes to consolidated financial statements
$
2,099,098
$ 6,785,045
Total
Program
Services
$ 63,679,571
9,231,699
$ 67,429,325
4,044,323
1,699,867
431,213
2,163,269
38,290
562,716
2,061,006
402,239
257,680
54,279
225,118
88,884
668,876
94,399
1,990,740
668,702
252,744
62,134
712,711
413
999,141
18,661
191,697
1,264,179
$ 84,633,426
$ 76,559,598
2013
Management
and
FundGeneral
Raising
$
122,313
42,613
122,753
47,855
294,446
49,601
917,072
302,495
1,239,007
$
216,609
16,363
93,628
2,407
34,975
529,979
501,850
453,254
8,405
212,710
12,202
7,263
6,288
356,111
129,765
14,252
63,820
8,167
263,137
8,690
566,372
274,376
232,126
2,956
3,793
1,987
226,830
46,637
59,488
$
2,805,008
1,970,433
$
Total
$ 67,429,325
8,088,338
1,459,299
518,626
1,546,023
29,473
439,382
1,264,179
368,313
259,341
63,153
186,573
58,978
561,376
60,278
1,710,274
623,508
232,126
59,488
6,428,022 $ 84,958,053
4
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Consolidated Statements of Cash Flows
Year Ended
December 31,
2013
2014
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
Net realized and unrealized losses on investments
Donated securities
Proceeds from donated securities
Changes in:
Contributions receivable
Beneficial interest in trusts
Prepaid expenses and other current assets
Security deposits
Inventory
Accounts payable and accrued expenses
Deferred revenues
Interest payable
Grants payable
Deferred rent
Annuities payable
$
Net cash provided by operating activities
Cash flows from investing activities:
Purchases of property and equipment
Purchases of investments
Proceeds from sales of investments
Net cash used in activities
Net increase in cash and cash equivalents
Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year
Supplemental disclosure of cash flow information:
Excise taxes paid
See notes to consolidated financial statements
(303,258)
$
668,702
137,837
(40,830,767)
40,768,552
623,508
6,379
(39,443,178)
39,362,908
7,137,907
6,670
(116,268)
(7,459)
11,809
116,956
(131,500)
62,134
(3,496,521)
(74,617)
(13,600)
(7,934,000)
(73,610)
(132,113)
(6,754)
(33,539)
46,249
129,000
59,488
8,107,907
(178,001)
30,429
3,936,577
8,317,025
(173,519)
(474,824)
464,000
(166,361)
(184,343)
(166,361)
8,150,664
85,573,349
3,752,234
93,724,013
$
7,752,352
97,476,247
$
93,724,013
$
210
5
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
[1]
Organization:
Actor Michael J. Fox established The Michael J. Fox Foundation for Parkinson's Research, incorporated in
Delaware in 2000, after publicly disclosing in 1998 that he had been diagnosed with Parkinson's disease
seven years earlier, at age 29.
In 2009, The Michael J. Fox Foundation for Parkinson's Research in Canada ("MJFF Canada") was
established as an officially registered tax-exempt charity in Canada. As this entity meets the criteria for
consolidation, its financial statements are consolidated with those of the Foundation (together, the
"Foundation"). As MJFF Canada's assets and liabilities and its operations were not significant at
December 31, 2014 and 2013, they are not shown separately in the accompanying consolidated financial
statements.
The Foundation is exempt from federal income taxes under Section 501(c)(3) of the U.S. Internal Revenue
Code, and from state and local taxes under comparable laws. MJFF Canada is exempt from similar taxes
under Canadian law.
Today, the Foundation is the world's largest nonprofit funder of Parkinson's research. It is dedicated to
accelerating a cure and improved therapies for the estimated five million people living with Parkinson's
disease today. The Foundation pursues its goals through an aggressively funded, highly targeted research
program, coupled with the active global engagement of scientists, Parkinson's patients, business leaders,
clinical trial participants, donors and volunteers.
In addition to funding more than $526,000,000 in research through the end of December 31, 2014, the
Foundation has fundamentally altered the trajectory of progress toward a cure. Operating at the hub of
worldwide Parkinson's research, the Foundation forges (i) groundbreaking collaborations with industry
leaders, academic scientists and government research funders; (ii) leverages new technologies to amplify
the patient voice in Parkinson's research; (iii) mobilizes patients and loved ones to increase the flow of
participants into clinical trials; and (iv) coordinates the grassroots involvement of thousands of Team Fox
members around the world.
From inception, the Foundation has invested in high-risk, high-reward research targets — an approach that
in a few short years has transformed the field of Parkinson's disease research. The Foundation partners
with the Parkinson's research community, speeding financial and intellectual resources to the scientists who
are carrying out projects with the greatest promise to impact patients' lives in the near term. This includes
strengthening the Parkinson's drug development pipeline by pushing forward investigations of genetic and
other disease-modifying targets with the best chance of slowing Parkinson's disease progression, as well as
addressing patients' unmet symptomatic needs. To date, the Foundation has evaluated work on more than
600 therapeutic targets, and is supporting more than 70 clinical trials.
[2]
Financial reporting:
(a) Basis of accounting:
The accompanying consolidated financial statements of the Foundation have been prepared using the
accrual basis of accounting and conform to accounting principles generally accepted in the United
States of America as applicable to not-for-profit entities. All significant interorganization balances and
transactions have been eliminated in the consolidated financial statements.
6
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
[2]
Financial reporting: (continued)
(b) Use of estimates:
The preparation of consolidated financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported amount of
assets, liabilities, revenues and expenses, as well as the disclosure of contingent assets and liabilities.
Actual results could differ from those estimates.
(c) Functional allocation of expenses:
The costs of providing the Foundation's various programs and supporting services have been
summarized on a functional basis in the accompanying consolidated statements of activities.
Accordingly, certain costs have been allocated among the program and supporting services in
reasonable ratios determined by management.
(d) Cash, cash equivalents and investments:
For financial statement purposes, cash and cash equivalents are comprised of highly liquid financial
instruments (such as U.S. Treasury notes or other government securities) with original maturities of
three months or less at the date of acquisition, except for that held as a part of the investment portfolio.
Cash and cash equivalents include approximately $928,000 of restricted cash.
Investments include highly liquid financial instruments with original maturities of between four and
twelve months at the date of acquisition.
Canadian cash equivalents in United States dollars were approximately $452,000 and $267,000 for
2014 and 2013, respectively. The unrealized losses on foreign currency are included in the
accompanying consolidated statements of activities.
The Foundation maintains a large balance of cash and highly liquid investments in recognition of the
fact that a high percentage of these assets have already been committed to future research payments.
(e) Net assets:
The net assets of the Foundation and changes therein are classified and reported as follows:
(i)
Unrestricted:
Unrestricted net assets represent those that are not subject to donor restrictions and are available
for current operations.
(ii)
Temporarily restricted:
Temporarily restricted net assets represent those resources the use of which has been restricted
by donors for research grants or the passage of time. Net assets released from restrictions
represent the payment of these grants and/or the passage of time.
A significant amount of contributions raised from special events are restricted for research.
7
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
[3]
Investments and investment income:
Investments in marketable securities are reported at their fair values when acquired; donated securities are
recorded at their fair values on the dates of the gifts. It is the Foundation's policy to sell donated securities
upon receipt. Realized and unrealized appreciation or depreciation of investments is included in the
accompanying consolidated statements of activities.
[4]
Property and equipment:
Property and equipment, all of which were purchased by the Foundation or donated to the Foundation at fair
values greater than or equal to $2,500, are depreciated using the straight-line method over the estimated
useful lives of three years for computer software, five years for equipment and seven years for furniture and
fixtures. Amortization of leasehold improvements is provided over the terms of the lease.
[5]
Inventory:
The Foundation's inventory consists of merchandise which is valued at the lower of cost or market value,
determined on a first-in, first-out method.
[6]
Grants payable:
The Foundation records appropriations for research grants as an expense and liability after approval by the
Board of Directors, based upon (i) the recommendations of the Research Committee of the Board, with the
guidance and input of the Scientific Advisory Board and other highly regarded scientists who serve on grantreview committees specializing in Parkinson's disease research and (ii) the availability of funding.
[7]
Deferred rent:
Rent expense is recognized using the straight-line method over the terms of the lease. The difference
between rent expense incurred and the rental amounts paid, which are attributable to scheduled rent
increases, is reported as a "deferred rent" obligation in the accompanying consolidated statements of
financial position.
[8]
Split-interest agreements:
A portion of the Foundation's assets result from deferred-giving vehicles subject to split-interest agreements.
The Foundation currently maintains five charitable gift annuities.
Charitable gift annuities are unrestricted, irrevocable gifts for which the Foundation agrees in turn to pay a
life annuity to the donor or to a designated beneficiary. The contributed funds and the attendant liabilities
immediately become part of the general assets and liabilities of the Foundation, subject to the Foundation's
maintaining an actuarial reserve in accordance with New York State Law.
The Foundation's liabilities associated with the charitable gift annuities are calculated on the basis of
actuarial data commonly used by not-for-profit organizations. Discount rates published by the Internal
Revenue Service ("IRS") are employed to determine the net present value of both contributions and
liabilities pertaining to these deferred-giving arrangements.
8
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
[9]
Accrued vacation:
Based on their tenure, the Foundation's employees are entitled to be paid for unused vacation time if they
leave the Foundation's employ. Accordingly, at each year-end, the Foundation must recognize a liability for
the amount that would be incurred if all employees with such unused vacation were to leave. The accrued
vacation obligation for 2014 and 2013 was approximately $66,000 and $57,000, respectively.
[10] Contributions and grants:
Contributions to the Foundation are recognized as revenue upon the receipt of either cash or other assets or
of unconditional pledges. Conditional contributions are recorded when the conditions have been met, and if
received in advance are recognized in the balance sheet as funds received in advance. Contributions to be
received over periods longer than a single year are discounted at an interest rate commensurate with the
risk involved.
[11] Rental revenue:
Revenue received from the sublease of the Foundation's prior office space is recognized in accordance with
contractual provisions. Revenue related to rental income received in advance is deferred until the following
year.
[12] Advertising costs:
Advertising costs are expensed as incurred.
$187,000 for 2014 and 2013, respectively.
Advertising expenses were approximately $225,000 and
[13] Volunteers:
A number of unpaid volunteers have made significant contributions of their time performing administrative
functions for the Foundation. The value of this contributed time is not recorded in the accompanying
consolidated financial statements because it does not meet the criteria for revenue recognition required by
generally accepted accounting principles.
[14] Income tax uncertainties:
The Foundation follows the provisions of the Financial Accounting Standards Board's ("FASB") Accounting
Standards Codification ("ASC") Topic 740, Income Taxes, relating to accounting and reporting for
uncertainty in income taxes. Because of the Foundation's general tax-exempt status, ASC Topic 740 has
not had, and is not expected to have, a material impact on the Foundation's consolidated financial
statements.
The annual compliance filings for the Foundation are subject to examination by the IRS, as well as by other
various state and local authorities, generally for three years after they are submitted.
[15] Fair value of financial instruments:
The Foundation reports a fair-value measurement of all applicable financial assets and liabilities, including
investments, contributions receivable, short-term payables, and grants payable. (For the fair valuation of
investments, see Note B.)
9
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
[16] Subsequent events:
The Foundation considers the accounting treatments, and the related disclosures in the current year's
financial statements, that may be required as the result of all events or transactions that occur after yearend through May 5, 2015, the date of the independent auditor's report.
[17] Reclassification:
Certain information in the prior year's financial statements has been reclassified to conform with the current
year's presentation.
NOTE B - INVESTMENTS
At each year-end, investments consisted of the following:
December 31,
2013
2014
Investments:
Certificates of deposit
Common stock
Cost
Fair
Value
$ 1,237,825
46,483
$ 1,237,558
49,769
$ 1,227,030
122,090
$ 1,227,454
124,671
1,284,308
1,287,327
1,349,120
1,352,125
234,479
267,295
248,079
273,965
$ 1,518,787
$ 1,554,622
$ 1,597,199
$ 1,626,090
Beneficial interest in trusts:
Charitable gift annuities
Cost
Fair
Value
During each year, net investment income and losses from foreign currencies consisted of the following:
Year Ended
December 31,
2013
2014
Interest and dividends
Net realized (losses) gains
Net unrealized gains (losses) - equities
Net investment gains - beneficial
interest in trusts
Net translation exchange loss
$
22,031
(137,851)
14
$ 27,269
996
(7,375)
6,930
(34,121)
25,531
(14,558)
$ (142,997)
$ 31,863
ASC Topic 820, "Fair Value Measurements and Disclosures," establishes a three-level valuation hierarchy of fairvalue measurements. These valuation techniques are based upon observable and unobservable inputs.
Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect
market assumptions. These two types of inputs create the following fair-value hierarchy:
10
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE B - INVESTMENTS (CONTINUED)
Level 1:
Valuations are based on observable inputs that reflect quoted market prices in active markets for
those investments, or similar investments, at the reporting date.
Level 2: Valuations are based on (i) quoted prices for those investments, or similar investments, in active
markets, or (ii) quoted prices for those investments, or similar investments, in markets that are not
active, or (iii) pricing inputs other than quoted prices that are directly or indirectly observable at the
reporting date. Level 2 assets include those investments that are redeemable at or near year-end
and for which a model was derived for valuation.
Level 3: Fair value is determined based on pricing inputs that are unobservable and includes situations
where (i) there is little, if any, market activity for the asset or liability, (ii) the underlying investments
of which cannot be independently valued, or (iii) they cannot be immediately redeemed at or near
year-end.
The following is a summary of the fair values of investments and other applicable assets at each year-end, in
accordance with these fair-value levels:
December 31, 2014
Level 3
Total
Level 1
Investments:
Certificates of deposit
Common stock
$ 1,237,558
49,769
$ 1,237,558
49,769
$ 1,227,454
124,671
$ 1,227,454
124,671
1,287,327
1,287,327
1,352,125
1,352,125
Beneficial interests in
trusts:
Charitable gift
annuities
Total
December 31, 2013
Level 1
Level 3
Total
$ 267,295
267,295
$ 1,287,327 $ 267,295 $ 1,554,622
$ 1,352,125
$ 273,965
273,965
$ 273,965
$ 1,626,090
The following table summarizes the changes in the fair value of the Level 3 investments in charitable gift annuities
in 2013 and 2014:
Balance - December 31, 2012
Contributions
Amounts paid to annuitants
Net investment gain
$
200,355
60,000
(11,921)
25,531
Balance - December 31, 2013
Amounts paid to annuitants
Net investment gain
$
273,965
(13,600)
6,930
Balance - December 31, 2014
$
267,295
11
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE C - CONTRIBUTIONS RECEIVABLE
At each year-end, unconditional amounts promised to the Foundation, but not yet collected, have been recorded
as receivables and are estimated to be collected as follows:
December 31,
2013
2014
2014
2015
2016
2017
2018
2019
Less discount to present value,
at a rate of 6% in both years
$
9,471,017
4,503,975
1,845,100
1,127,050
99,000
$ 15,520,225
3,792,600
3,610,100
870,100
599,000
99,000
17,046,142
24,491,025
(1,050,714)
(1,357,690)
$ 15,995,428
$ 23,133,335
Based on its prior experience with donors, management expects all receivables to be fully collectible.
Accordingly, no allowance for doubtful amounts has been provided.
NOTE D - PROPERTY AND EQUIPMENT
At each year-end, property and equipment consisted of the following:
December 31,
2013
2014
Computer hardware and software
Furniture and fixtures
Leasehold improvements
Less accumulated depreciation and
amortization
$ 1,937,365
285,053
1,865,034
$ 1,922,904
256,652
1,734,377
4,087,452
3,913,933
(2,980,293)
(2,311,591)
$ 1,107,159
$ 1,602,342
Depreciation expense for 2014 and 2013 was $668,702 and $623,508, respectively.
12
THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE E - GRANTS PAYABLE
At each year-end, grants payable are due to be paid as follows:
December 31,
2013
2014
2014
2015
2016
2017
2018
Less discount to present value,
at a rate of 3% in both years
$ 52,540,452
11,535,972
3,774,051
475,178
$ 53,358,445
14,807,810
2,514,955
1,025,376
303,250
68,325,653
72,009,836
(1,031,788)
(1,219,450)
$ 67,293,865
$ 70,790,386
NOTE F - LOAN PAYABLE
In 2008, the Foundation entered into a loan agreement, the terms of which stipulate that the Foundation record
the present value of $2,450,000, discounted at a rate of 4.53% per annum. Interest is compounded on a
semiannual basis, and no principal or interest payments are due until 2028.
During 2012, the Foundation entered into a new loan agreement, the terms of which stipulate that the Foundation
record the present value of $228,600, discounted at a rate of 2.56% per annum. Interest is compounded on a
semiannual basis, and no principal or interest payments are due until 2028.
The loan balances and original issue discounts were $1,150,196 as of both December 31, 2014 and 2013,
respectively, and accrued interest payable as of December 31, 2014 and 2013 was $337,017 and $274,883,
respectively. Funds obtained were applied to fund research focused on developing a cure for Parkinson's disease.
NOTE G - TEMPORARILY RESTRICTED NET ASSETS
At each year-end, temporarily restricted net assets were restricted for the following:
December 31,
2013
2014
Research
Time restrictions
$ 18,549,554
400,000
$ 16,726,756
600,000
$ 18,949,554
$ 17,326,756
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THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE G - TEMPORARILY RESTRICTED NET ASSETS (CONTINUED)
During each year, net assets released from restrictions resulted from satisfying the following donor restrictions:
Year Ended
December 31,
2013
2014
Research
Time restriction
$ 47,314,624
200,000
$ 37,227,872
1,011,167
$ 47,514,624
$ 38,239,039
NOTE H - RENTAL INCOME AGREEMENT
In April 2012, the Foundation entered into an agreement to sublease its prior office space in lower Manhattan (see
Note I[1]) to an unrelated party. Shortly thereafter, in June 2012, the tenant was acquired by an unrelated third
party. The third party then assumed the office space and related sublease obligation through October 2012, at
which time the third party ended the sublease. In July 2013, the Foundation entered into a new agreement for the
same space with another unrelated party through August 2016.
Rental income of $429,678 and $665,430 is recognized in the accompanying consolidated statements of activities
for 2014 and 2013, respectively.
NOTE I - COMMITMENTS
[1]
Lease commitment:
The Foundation has leases for three office spaces, two located in Manhattan and one in Los Altos,
California. The original lease, located in lower Manhattan, was signed in 2005 and is due to expire in 2016.
During 2012, the Foundation signed a lease for office space in midtown Manhattan which will expire in
January 2019. During 2013, the Foundation entered into a new lease agreement for office space in Los
Altos that commenced in September 2013 and expires in September 2016.
Future minimum rent payments, exclusive of escalation charges and real estate taxes are as follows:
Year
Amount
2015
2016
2017
2018
2019
$ 1,689,846
1,620,264
1,261,434
1,286,663
109,366
$ 5,967,573
Rent expense for 2014 and 2013 was $1,541,971 and $1,517,675, respectively.
[2]
Other contracts:
In the normal course of its business, the Foundation enters into various contracts for professional and other
services, which are typically renewable on a year-to-year basis.
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THE MICHAEL J. FOX FOUNDATION FOR PARKINSON'S RESEARCH
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE I - COMMITMENTS (CONTINUED)
[3]
Letters of credit:
The Foundation has a $132,000 unused letter of credit with a bank, which is required under the lease
agreement for its existing office space in Manhattan. The letter of credit is collateralized by a $132,000 time
deposit that the Foundation must maintain with the bank.
The Foundation has an additional $795,636 unused letter of credit with a bank, which is required under the
lease agreement for its existing office space in Manhattan. This letter of credit is also collateralized by a
$795,636 time deposit that the Foundation must maintain with the bank.
[4]
Contingent funding for research:
The Foundation has been awarded contingent research funding of $975,000 from several donors to be
received over the next several years. Since these funds are contingent upon the progress of research,
these amounts have not been included in the accompanying consolidated financial statements.
NOTE J - RETIREMENT BENEFITS
The Foundation has a defined-contribution retirement plan, formed under U.S. Internal Revenue Code
Section 401(k), that covers all employees who meet certain length-of-service requirements. Participants'
contributions are fully vested at all times. The Foundation's contributions to the plan were $247,598 and
$224,387 in 2014 and 2013, respectively.
NOTE K - CONCENTRATION OF CREDIT RISK
The Foundation maintains its cash with major banking institutions in amounts which, from time to time, may be in
excess of federal insurance limits. Management believes that the Foundation has no significant risk of loss on
these accounts relating to the failure of the banking institutions.
NOTE L - CONCENTRATION OF REVENUE
During 2014 and 2013, approximately 47% and 45%, respectively, of the Foundation's total support was provided
by two donors in each year.
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