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HomeMy WebLinkAboutT2T FinancialTABLE TO TABLE FOOD DISTRIBUTION NETWORK FINANCIAL STATEMENTS For the Year Ended June 30, 2023 Page Independent Auditor's Report 1 - 2 Financial Statements: Statement of Assets, Liabilities, and Net Assets - Modified Cash Basis 3 Statement of Activities - Modified Cash Basis 4 Statement of Functional Expenses - Modified Cash Basis 5 Notes to Financial Statements 6 - 9 TABLE TO TABLE FOOD DISTRIBUTION NETWORK TABLE OF CONTENTS 1 Independent Auditor’s Report To the Board of Directors Table to Table Food Distribution Network Opinion We have audited the financial statements of Table to Table Food Distribution Network, which comprise the statement of assets, liabilities, and net assets – modified cash basis as of June 30, 2023, and the related statements of activities – modified cash basis and functional expenses – modified cash basis for the year then ended, and the related notes to the financial statements. In our opinion, the accompanying financial statements present fairly, in all material respects, the assets, liabilities, and net assets of Table to Table Food Distribution Network as of June 30, 2023, and its support, revenue, and expenses for the year then ended in accordance with the modified cash basis of accounting described in Note 1. Basis for Opinion We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of Table to Table Food Distribution Network and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence obtained is sufficient and appropriate to provide a basis for our audit opinion. Emphasis of Matter — Basis of Accounting We draw attention to Note 1 of the financial statements, which describes the basis of accounting. The financial statements are prepared on the modified cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter. Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with the modified cash basis of accounting described in Note 1, and for determining that the modified cash basis of accounting is an acceptable basis for the preparation of the financial statements in the circumstances. Management is also responsible for 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. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. 1529 Indian Avenue, Tipton, Iowa 52772 (563) 886-4533 susan@sstutzelcpa.com 2 The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with GAAS, we: • Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. • Obtain an understanding of internal control relevant to the audit 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 Table to Table Food Distribution Network’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about Table to Table Food Distribution Network’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that we identified during the audit. S Stutzel, CPA Tipton, Iowa October 31, 2023 ASSETS Current Assets Cash and Cash Equivalents $248,036 Certificates of Deposit, short-term 290,657 Prepaid Expenses 27 Total Current Assets 538,720 Deposits 120 Beneficial Interest in Assets Held by Community Foundation 5,000 Leasehold Imrovements 91,573 Software 99,560 Equipment 321,819 512,952 Less: Accumulated Depreciation (323,421) Net Equipment 189,531 TOTAL ASSETS $733,371 LIABILITIES AND NET ASSETS Current Liabilities Payroll and Related Liabilities $6,883 Total Current Liabilities 6,883 NET ASSETS Without Donor Restriction 721,052 With Donor Restriction 5,436 TOTAL NET ASSETS 726,488 TOTAL LIABILITIES AND NET ASSETS $733,371 TABLE TO TABLE FOOD DISTRIBUTION NETWORK STATEMENT OF ASSETS, LIABILITIES, AND NET ASSETS - MODIFIED CASH BASIS JUNE 30, 2023 See accompanying notes to Financial Statements. 3 Without Donor Restriction With Donor Restriction Total REVENUES, GAINS AND OTHER SUPPORT Contributions $285,104 $- $285,104 In-kind Food Donations 7,668,654 - 7,668,654 Special Events, net of direct expenses of $5,927 89,811 - 89,811 Grants 241,172 - 241,172 Interest Income 1,317 - 1,317 Total Revenues, Gains and Other Support 8,286,058 - 8,286,058 EXPENSES Program Services 8,190,507 - 8,190,507 Supporting Services Management and General 100,072 - 100,072 Fundraising 18,024 - 18,024 Total Expenses 8,308,603 - 8,308,603 CHANGE IN NET ASSETS (22,545) - (22,545) NET ASSETS - BEGINNING OF YEAR 743,597 5,436 749,033 NET ASSETS - END OF YEAR $721,052 $5,436 $726,488 TABLE TO TABLE FOOD DISTRIBUTION NETWORK STATEMENT OF ACTIVITIES - MODIFIED CASH BASIS FOR THE YEAR ENDED JUNE 30, 2023 See accompanying notes to Financial Statements. 4 Program Management Fund- Services and General Raising Total EXPENSES In-kind Expenses 7,668,654$ -$ -$ 7,668,654$ Salaries 286,918 46,561 5,134 338,613 Payroll Taxes 21,758 3,531 389 25,678 Employee Benefits 14,758 2,395 264 17,417 Pension Plan Benefits 4,418 717 79 5,214 Vehicle Expense 66,622 - - 66,622 Supplies 11,010 1,625 12,158 24,793 Depreciation 72,833 - - 72,833 Rent 23,668 1,246 - 24,914 Occupancy 10,460 550 - 11,010 Professional Fees - 27,426 - 27,426 Insurance - 5,456 - 5,456 Community Relations 9,242 - - 9,242 Staff Development and Travel 166 2,434 - 2,600 Miscellaneous - 8,131 - 8,131 TOTAL EXPENSES 8,190,507$ 100,072$ 18,024$ 8,308,603$ See accompanying notes to Financial Statements. 5 Supporting Services TABLE TO TABLE FOOD DISTRIBUTION NETWORK STATEMENT OF FUNCTIONAL EXPENSES - MODIFIED CASH BASIS FOR THE YEAR ENDED JUNE 30, 2023 TABLE TO TABLE FOOD DISTRIBUTION NETWORK Notes to Financial Statements 6 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations: Table to Table Food Distribution Network (Table to Table) is a nonprofit organization that keeps wholesome, edible food from going to waste by collecting it from donors and distributing to those in need through agencies located primarily in Johnson County, Iowa that serve the hungry, homeless and at-risk populations. Basis of Accounting: The accompanying financial statements have been prepared on the modified cash basis of accounting. The modified cash basis method of accounting differs from accounting principles generally accepted in the United States of America primarily because certain revenues are recognized when received rather than when earned and certain expenses are recognized when paid rather than when the obligation is incurred. The Organization has modified the cash basis of accounting as follows: • major expenditures for property and equipment are capitalized and depreciated over their estimated useful lives; • accrued payroll and benefit expenses are reported as liabilities. Noncash transactions, except depreciation and in-kind gifts, are not recognized. Financial Statement Presentation: Table to Table is required to report information regarding its financial position and activities according to two classes of net assets: net assets without donor restriction and net assets with donor restriction. Net Assets without donor restriction: Assets that are neither permanently restricted nor temporarily restricted by donor-imposed stipulations. The Organization’s governing body may earmark portions of its unrestricted net assets as board-designated for various purposes. Net Assets with donor restriction: Assets resulting from contributions and other inflows of assets whose use by the Organization is limited by donor-imposed stipulations that either expire by passage of time or can be fulfilled by actions of the Organization meeting the purpose of the restriction. Certificates of Deposit: Certificates of deposit are stated at cost. Equipment: Equipment is stated at cost. Depreciation is computed on a straight-line basis over the estimated useful lives of the related assets, which range from three to five years. All acquisitions of equipment in excess of $500 are capitalized. TABLE TO TABLE FOOD DISTRIBUTION NETWORK Notes to Financial Statements 7 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Income taxes: Table to Table is a nonprofit organization that is exempt from income taxes under Section 501(c)(3) of the Internal Revenue Code and classified by the Internal Revenue Service as other than a private foundation. Income not directly related to the Organization’s tax-exempt purpose would be subject to taxation as unrelated business income. Functional Expenses: The costs of providing various program and supporting services have been summarized on a functional basis in the statement of activities – modified cash basis. The statement of functional expenses – modified cash basis presents the natural classification detail of expenses by function. Accordingly, certain costs have been allocated among the programs and supporting services benefited. The expenses that are allocated include occupancy related costs which are allocated on a square footage basis, as well as salaries and wages and related payroll expenses, which are allocated on the basis of estimates of time and effort. In-Kind Food Donations and Donated Services: During the year ended June 30, 2023, Table to Table rescued 2,316,814 pounds of food with a total value of $7,668,654. No amounts have been reflected in the financial statements for donated services. Table to Table generally pays for services requiring specific expertise. However, many individuals volunteer their time and perform a variety of tasks that are essential to Table to Table’s mission. Table to Table received more than 11,000 volunteer hours during fiscal year 2022/23, with an estimated value to Table to Table of $375,240. Restricted and Unrestricted Revenue: Contributions that are restricted by the donor are reported as increases in net assets without donor restriction if the restrictions expire (that is, when a stipulated time restriction ends or purpose restriction is accomplished) in the reporting period in which the revenue is recognized. All other donor-restricted contributions are reported as increases in net assets with donor restriction, depending on the nature of the restrictions. When a restriction expires, net assets with donor restriction are reclassified to net assets without donor restriction and reported in the statement of activities as net assets released from restrictions. NOTE 2 – CERTIFICATES OF DEPOSIT Table to Table holds certificates of deposit totaling $290,657 as of June 30, 2023. The certificates bear interest at rates ranging from 2.47% - 4.91% and carry maturity dates through June 2024. TABLE TO TABLE FOOD DISTRIBUTION NETWORK Notes to Financial Statements 8 NOTE 3 – DESIGNATED AGENCY ENDOWMENT FUND In February 2012, Table to Table transferred $5,000 to the Community Foundation of Johnson County (the Foundation) to establish a Designated Agency Endowment Fund for the benefit of the Organization. The Foundation will make distributions to Table to Table in accordance with the Foundation’s spending policy of the year as determined annually by the Foundation’s Board of Directors. In the event that Table to Table should decide to terminate, or cease to exist, as a legal entity, the assets and any income received from those assets shall be redirected to support another charitable agency or agencies as determined by the Foundation’s Board of Directors. The assets may also be returned to Table to Table in special circumstances upon request of the Foundation. Since origination, additional contributions have been made to the endowment by unrelated third parties. As of June 30, 2023, Table to Table had a total of $69,838 in the fund. No amounts were distributed to Table to Table from the Foundation for the year ended June 30, 2023. NOTE 4 – SIMPLE IRA PLAN Table to Table has a Simple IRA plan covering substantially all employees. Table to Table contributes an amount equal to 3% of each covered employees’ wages. For the year ended June 30, 2023, Table to Table contributed $5,214 according to this plan. NOTE 5 – FUNDRAISING ACTIVITIES Table to Table engages in various fundraising activities during the year including an annual dinner, radio- thon and other minor activities. The annual dinner resulted in revenues of $33,994, with direct expenses of $3,925. The Radio-thon generated $33,487 and other events generated $28,257, with direct expenses of $2,002. NOTE 6 – LEASE AGREEMENTS AND COMMITMENTS In July 2021, Table to Table signed a 5-year lease agreement for the use of facilities, common space and 9 parking spaces until August 2026, with two options to renew for three years each. The lease calls for initial monthly payments of $1,624 with increasing rents throughout the lease term. Future commitments under this agreement are as follows: For the year ending June 30, 2024 $ 42,461 2025 44,842 2026 47,223 2027 7,937 Total $142,463 Rent expense for the year ended June 30, 2023 was $37,834. Beginning in July 2021, a sublease agreement was entered into with a local nonprofit organization to share facility space. The sublease calls for increasing rents over time plus a portion of utilities and internet. A total of $16,298 was collected under these sublease agreements during the year ended June 30, 2023. TABLE TO TABLE FOOD DISTRIBUTION NETWORK Notes to Financial Statements 9 NOTE 6 – LEASE AGREEMENTS AND COMMITMENTS (Continued) During June 2017, Table to Table entered into a seven-year lease agreement with a vehicle leasing service for a 22-foot refrigerated aluminum van. The agreement calls for 84 monthly payments of $1,778 beginning July 2017. Total expenses related to this agreement for the year ended June 30, 2023 were $24,511. Future commitments related to this vehicle lease are $21,701 for the year ending June 30, 2024. NOTE 7 – DONOR RESTRICTED AND BOARD DESIGNATED NET ASSETS Net assets with donor restriction consist of the $5,000 in the Endowment at June 30, 2023 and $436 received for refrigeration signage. During the year ended June 30, 2020, the Organization established an operating reserve policy. The purpose of the policy is to build and maintain an adequate level of unrestricted net assets to support the Organization’s day-to-day operations in the event of unforeseen shortfalls. As of June 30, 2023, board designated funds of $142,460 are required to be held in cash or cash equivalents. NOTE 8 – LIQUIDITY It is the Organization’s policy to structure its financial assets to be available as its general expenditures, liabilities, and other obligations come due. The Organization has $538,693, consisting of cash and certificates of deposit, of financial assets available within one year of the statement of assets, liabilities, and net assets – modified cash basis date to meet cash needs for general expenditures. None of the financial assets are subject to donor or other contractual restrictions that make them unavailable for general expenditures within one year of the statement of financial position date. NOTE 9 – SUBSEQUENT EVENTS In preparing the accompanying financial statements, management evaluated subsequent events through October 31, 2023, the date the financial statements were available to be issued, for material subsequent events requiring recognition or disclosure. Subsequent to year end, the Organization received notice of a $1.8 million federal grant award for the use of building shared facility space with other local nonprofit organizations. No contracts have been signed as of the date of this report.