Agenda - 2-17-14 Reg. Meeting - Laserfiche WebLink

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CI:3a JOHNSTON- LEE - HARNETT COMMUNITY ACTION, INCORPORATED Notes to Financial Statements June 30, 2013 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Income Taxes The Organization is exempt from income taxes under Section 501(c)(3) of the Internal Revenue Code. Therefore, no provision for income taxes has been made in the accompanying financial statements. The Organization follows the provisions of FASB ASC 740 -10 Accounting for Uncertainty in Income Taxes. FASB ASC 740 -10 prescribes a comprehensive model for how an organization should measure, recognize, present, and disclose in its financial statements uncertain tax positions that the organization has taken or expects to take on a tax return. The Organization is no longer subject to U.S. Federal or North Carolina State income tax examinations by tax authorities for the years ending before June 30, 2010. Donated Material and Services Donated materials and use of space are recorded as contributions at their estimated fair market values at the date of receipt. The Organization recognized donated materials and use of space in the amount of $1,111,807 for the year ended June 30, 2013. The Organization recognizes contributions of services if such services (a) create or enhance non - financial assets or (b) require specialized skills and are provided by individuals possessing those skills and would typically need to be purchased if not contributed. The accompanying statement of activities includes the recognition of donated services of $246,841 for its early childhood programs, all of which relates to the efforts of teachers who were paid by a local school system. Other donated services have not been reflected in the accompanying financial statements since they do not meet the criteria for recognition under accounting principles generally accepted in the United States of America. Nevertheless, a substantial number of volunteers have donated significant amounts of their time, principally as assistants in the early childhood programs. Management estimates the value of such services at $36,320 for the year ended June 30, 2013. Functional Allocation of Expenses The costs of providing the program services and other activities have been summarized on a functional basis in the statement of activities. Accordingly, certain costs have been allocated between the program and supporting services benefited. The Organization receives the majority of its support through recurring awards or competitive bidding. Accordingly, fundraising costs are not material and as such have not been separately presented in the financial statements. Ls1