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

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u3G JOHNSTON- LEE - HARNETT COMMUNITY ACTION, INCORPORATED Notes to Financial Statements June 30, 2013 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Advertisinq Costs The Organization uses advertising to promote its programs among the audiences it serves. Advertising costs are expensed as incurred. Advertising expense for the year ended June 30, 2013 was $600. Subsequent Events The Organization has evaluated events and transactions that occurred between June 30, 2013 and December 11, 2013 which is the date the financial statements were available to be issued, for possible recognition or disclosure in the financial statements. Subsequent to year end the Organization has been awarded various grants. All such grants are related to fulfilling its program objectives and its missions. 3. EMPLOYEE BENEFIT PLAN The Organization has a defined contribution pension plan under Internal Revenue Code section 403(b). All employees who work at least 20 hours per week or 1,000 hours annually are eligible to participate in the Plan after completing a three month service requirement. The Plan uses a matching formula in which it contributes a discretionary percentage of the first 5% of employee deferrals. Employees are 100% vested with respect to employer contributions after completing two years of service. The Organization's contributions for the year ended June 30, 2013 were $137,399. 4. TEMPORARILY RESTRICTED NET ASSETS Temporarily restricted net assets are available for the following purposes at June 30, 2013: Early childhood programs $ 552,770 Weatherization 310,000 Capacity Building Grant 9,265 Community Services Block Grant 1.544 5. RELATED PARTY The Organization paid a company owned by an employee $12,533 for repair and maintenance services provided during the year ended June 30, 2013. 6. COMMITMENTS AND CONTINGENCIES The Organization receives significant financial assistance from governmental entities. These contracts and awards normally provide for the recovery of direct and indirect costs. Entitlement to the recovery of the applicable direct and indirect costs is generally conditioned upon compliance with the terms and conditions of the grant agreements and applicable regulations, including the expenditure of the resources for eligible purposes. Substantially all awards and the Organization's indirect cost rate are subject to financial and compliance reviews and audits by grantors. In management's opinion, the likelihood of an adverse material outcome upon its financial position from those reviews and audits is remote. 1•