family centre society of southern alberta financial

Family Centre Society of Southern AlbertaFinancial Statements

Forthe year ended March 31, 2018

Family Centre Society of Southern AlbertaContents


Page

Managements Responsibility

Independent Auditor& Report

FinancialStatements

Statement of Financial Position I

Statement of Operations 2

[ Statement of Changes in Net Assets 3

Statement of Cash Flows 4

Notes to the Financial Statements 5

Management’s Responsibihty

To the Members of Family Centre Society of Southern Alberta:

Management is responsible for the preparation and presentation of the accompanying financial statements, including responsibility for

significant accounting judgments and estimates in accordance with Canadian accounting standards for not-for-profit organizations. This

f responsibility includes selecting appropriate accounting principles and methods, and making decisions affecting the measurement oftransactions in which objective judgment is required.

In discharging its responsibilities for the integrity and fairness of the financial statements, management designs and maintains the

necessary accounting systems and related internal controls to provide reasonable assurance that transactions are authorized, assetsare safeguarded and financial records are properly maintained to provide reliable information for the preparation of financial statements.

The Board of Directors and Audit Committee are composed entirely of Directors who are neither management nor employees of the[ Society. The Board is responsible for overseeing management in the performance of its financial reporting responsibilities, and forapproving the financial information included in the annual report. The Board fulfils these responsibilities by reviewing the financialinformation prepared by management and discussing relevant matters with management and external auditors. The Audit Committee[ has the responsibility of meeting with management and external auditors to discuss the internal controls over the financial reportingprocess, auditing matters and financial reporting issues. The Audit Committee is also responsible for recommending the appointment ofthe Society’s external auditors.

MNP LLP is appointed by the Board to audit the financial statements and report directly to them; their report follows. The externalauditors have full and free access to, and meet periodically and separately with, the Board, Audit Committee, and management todiscuss their audit findings.

June 18 2018

__________

L2Executive Director Director

Independent Auditors’ Report

1,lIfIPTo the Members of Family Centre Society of Southern Alberta:

We have audited the accompanying financial statements of Family Centre Society of Southern Alberta, which comprise the statement of

financial position as at March 31, 2018, and the statements of operations, changes in net assets and cash flows for the year then ended,

and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian

accounting standards for not-for-profit organizations, and for such internal control as management determines is necessary to enable

the preparation 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 financial statements based on our audit. We conducted our audit in accordance with

J Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. Theprocedures selected depend on the auditors’ 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 theentity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit alsoincludes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made bymanagement, 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 financial statements present fairly, in all material respects, the financial position of Family Centre Society of SouthernAlberta as at March 31, 2018 and the results of its operations, changes in net assets and its cash flows for the year then ended inaccordance with Canadian accounting standards for not-for-profit organizations.

Other Matter

The statement of financial position as at March 31, 2017 and the statements of operations, changes in net assets and cash flows for theC year ended March 31, 2017 were audited by another accounting firm of Chartered Professional Accountants who expressed an

unmodified opinion on those statements.

Lethbridge, Alberta /t’f,.Aj”7’ L.L PJune 18, 2018 Chartered Professional Accountants

ACCOUNTING > CONSULTING ) TAX

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Family Centre Society of Southern AlbertaStatement of Financial Position

As at March 31, 2018

2018 2017

AssetsCurrent

Cash (Note 3) 412,185 855,452Accounts receivable 22,317 32,930Goods and services taxes recoverable 3,028 5,104Prepaid expenses (Note 4) 20,040 19,950

457,570 913,436

Trust funds (Note 6) - 324

Property and equipment (Note 5) 693,876 348,086

Prepaid expenses (Note 6) 51,389 59,722

1,202,835 1,321,568

LiabilitiesCurrent

Accounts payable and accruals 90,498 55,530Vacation and overtime payable 94,390 103,911Deferred revenue (Note 7) 188,834 282,203

373,722 441,644

Trust funds (Note 6)- 324

Deferred revenue - Capital campaign (Note 8) - 418,256

Unamortized capital contributions (Note 9) 660,972 302,294

1,034,694 1,162,518

Net AssetsUnrestricted net assets 129,215 107,236Net assets in property and equipment 32,906 45,794Internally restricted net assets (Note 10) 6,020 6,020

168,141 159,050

1,202,835 1,321,568

Ap oved on behalf of the Board

u// L4(Dir tor Directqf 7] ,,,J

The accompanying notes are an integral part of these financial statements

Family Centre Society of Southern AlbertaStatement of OperationsForthe year ended March 31, 2018

2018 2018 2017Budget

RevenueSouthern Alberta Child and Family Services 725,581 654,014 715,212Parent Link 577,824 567,655 512,617City of Lethbridge 567,250 537,558 454,567Supporting Fathers Involvement Alberta 95,000 130,629 136,971Supporting Fathers Involvement Alberta- First Nations 103,970 110,653 82,630Annual gala 64,000 72,634 71,498Other grants - 46,326 -

Donations in kind - 39,939 27,315Capital campaign - 37,971 -

Donations 53,000 36,163 18,423McHappy Foundation 16,000 30,087 14,527Casino - 29,707 -

Lethbridge Early Years Coalition 22,500 28,794 20,417Lethbridge School District #51 15,000 15,000 15,150Programs and projects 38,200 13,577 19,371Memberships 10,750 7,687 9,616Holy Spirit Catholic Regional Division #4 5,000 5,000 5,000Alberta Justice 7,200 4,050 5,700Summer student - 3,807 -

Amortization of capital contributions - 39,975 25,991

Total revenue 2,301,275 2,411,226 2,135,005

ExpensesSalaries and benefits 1,712,725 1,697,246 1,543,810Rent 246,080 248,119 245,535Capital items under threshold 8,500 59,620 8,341Programs and projects 66,815 49,983 48,200Donations in kind

- 39,939 27,315Food 26,985 39,793 25,601Annual gala 35,500 32,462 26,453Training and education 26,505 22,861 18,964Telephone and utilities 28,196 25,251 25,063Advertising and promotion 56,372 24,539 28,624Repairs and maintenance 2,750 17,134 3,732Insurance 15,915 15,988 16,230Office 11,521 15,216 9,460Goods and Services Tax 11,503 14,647 9,545Travel 27,558 13,410 13,428Professional fees 8,450 11,000 8,450Office equipment lease 8,450 6,898 7,153Accreditation

- 4,493 543Bank charges and interest 4,250 4,181 3,817Retreat

- 3,646 -

Association dues 3,200 2,846 3,856Amortization

- 52,863 39,574

Total expenses 2,301,275 2,402,135 2,113,694

Excess of revenue over expenses - 9,091 21,311


2

Family Centre Society of Southern AlbertaStatement of Changes in Net Assets

For the year ended March 31, 2018

Unrestricted Net assets in Internally 2018 2017net assets property & restricted net

equipment assets

Net assets beginning of year 107,236 45,794 6,020 159,050 137,739

Excess of revenue over expenses 9,091 - - 9,091 21,31 1

Amortization 52,863 (52,863) - -

Amortization of capital contributions (39,975) 39,975 - - -

Net assets, end of year 129,215 32,906 6,020 168,141 159,050


3

Family Centre Society of Southern AlbertaStatement of Cash FlowsFor the year ended March 31, 2018

2018 2017

Cash provided by (used for) the following activitiesF’ Operating

Excessof revenue over expenses 9,091 21,311

Amortization 52,863 39,574Amortization of capital contributions (39,975) (25,991)

21,979 34,894Changes in working capital accounts

Accounts receivable 10,613 2,897Accounts receivable - capital campaign - 14,000Goods and services taxes recoverable 2,076 4,241Prepaid expenses 8,244 8,549Accounts payable and accruals 34,967 (39,626)Vacation and overtime payable (9,521) (6,296)Deferred revenue (93,369) 88,566

(25,011) 107,225

InvestingIncrease (decrease) in deferred revenue - capital campaign (418,256) 216,867

Increase (decrease) in cash resources (443,267) 324,092Cash resources, beginning of year 855,452 531,360

Cash resources, end of year 412,185 855,452

Non-Cash Transactions (Note 5, Note 7, Note 8)


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Family Centre Society of Southern AlbertaNotes to the Financial Statements


1. Incorporation and nature of the organization

FamNy Centre Society of Southern Alberta (the “Organization”) was incorporated under the authority of the Societies Act ofAlberta and is a registered charity registered as a not-for-profit organization and is exempt from income taxes under section149(l)(f) of the Income Tax Act (‘the Act”). In order to maintain its status as a registered not-for-profit organization under theAct, the Organization must meet certain requirements within the Act. In the opinion of management these requirementshave been met.

The Organization’s objective is to provide family support and resources which will strengthen and empower families,enhance the capacities of parents and foster the optimal development of children and youth.

2. Significant accounting policies

The financial statements have been prepared in accordance with Canadian accounting standards for not-for-profitorganizations set out in Part Ill of the CPA Canada Handbook - Accounting, as issued by the Accounting Standards Boardin Canada and include the following significant accounting policies:

Cash and cash equivalents

Cash and cash equivalents include balances with banks and short-term investments with maturities of three months or less.

Property and equipment

Property and equipment are recorded at cost. Contributed capital assets are recorded at fair value at the date ofcontribution if fair value can be reasonably determined.

Amortization is provided using the straight-line method at rates intended to amortize the cost of assets over their estimateduseful lives.

Property and equipment acquired during the year but not placed into use are not amortized until they are placed into use.

Computer equipment 4 yearsEquipment 5 yearsOffice equipment 10 yearsLeasehold improvements 15 years

Unamortized capital contributions

Deferred contributions related to property and equipment represent the unamortized portion of contributed capital assetsand restricted contributions that were used to purchase the Organization’s leasehold improvements. Recognition of theseamounts as revenue is deferred to periods when the related property and equipment is amortized.

Revenue recognition

The Society follows the deferral method of accounting for contributions. Restricted contributions are recognized as revenuein the year in which the related expenses are incurred. Unrestricted contributions are recognized as revenue when receivedor receivable if the amount to be received can be reasonably estimated and collection is reasonably assured.

Pledges are recognized as revenue when the amount to be received can be reasonably estimated and ultimate collection isreasonably assured.

Long-lived assets

Long-lived assets consist of property and equipment. Long-lived assets held for use are measured and amortized asdescribed in the applicable accounting policies.

When the Organization determines that a long-lived asset no longer has any long-term service potential to the organization,the excess of its net carrying amount over any residual value is recognized as an expense in the statement of operations.Write-downs are not reversed.

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For the year ended March 31, 2018

2. Significant accounting policies (Continued from previous page)

Contributed materials and services

Contributions of materials and services are recognized both as contributions and expenses in the statement of operationswhen a fair value can be reasonably estimated and when the materials are used in the normal course of the Organizationsoperations and would otherwise have been purchased.

The operations of the Society depend on the contribution of time by volunteers. The fair value of donated volunteer servicescannot be reasonably determined and is therefore not reflected in these financial statements.

Financial instruments

The Organization recognizes its financial instruments when the Organization becomes party to the contractual provisions ofthe financial instrument. All financial instruments are initially recorded at their fair value, including financial assets andliabilities originated and issued in a related party transaction with management. Financial assets and liabilities originatedand issued in all other related party transactions are initially measured at their carrying or exchange amount in accordancewith Section 3840 Related Party Transactions.

At initial recognition, the Organization may irrevocably elect to subsequently measure any financial instrument at fair value.The Organization has not made such an election during the year.

Transaction costs and financing fees directly attributable to the origination, acquisition, issuance or assumption of financialinstruments subsequently measured at fair value are immediately recognized in the excess of revenues over expenses forthe current period. Conversely, transaction costs and financing fees are added to the carrying amount for those financialinstruments subsequently measured at cost or amortized cost.

Financial asset impairment:

The Organization assesses impairment of all of its financial assets measured at cost or amortized cost. The Organizationgroups assets for impairment testing when available information is not sufficient to permit identification of each individuallyimpaired financial asset in the group; there are numerous assets affected by the same factors; and no asset is individuallysignificant. Management considers whether the issuer is having significant financial difficulty; whether there has been abreach in contract, such as a default or delinquency in interest or principal payments in determining whether objectiveevidence of impairment exists. When there is an indication of impairment, the Organization determines whether it hasresulted in a significant adverse change in the expected timing or amount of future cash flows during the year. If so, theOrganization reduces the carrying amount of any impaired financial assets to the highest of: the present value of cash flowsexpected to be generated by holding the assets; the amount that could be realized by selling the assets; and the amountexpected to be realized by exercising any rights to collateral held against those assets. Any impairment, which is notconsidered temporary, is included in current year excess of revenues over expenses.

The Organization reverses impairment losses on financial assets when there is a decrease in impairment and the decreasecan be objectively related to an event occurring after the impairment loss was recognized. The amount of the reversal isrecognized in the excess of revenues over expenses in the year the reversal occurs.

Measurement uncertainty

The preparation of financial statements in conformity with Canadian accounting standards for not-for-profit organizationsrequires management to make estimates and assumptions that affect the reported amounts of assets and liabilities anddisclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenuesand expenses during the reporting period.

Accounts receivable are stated after evaluation as to their collectability and an appropriate allowance for doubtful accountsis provided where considered necessary. Amortization is based on the estimated useful lives of property and equipment.

These estimates and assumptions are reviewed periodically and, as adjustments become necessary they are reported inexcess of revenues and expenses in the periods in which they become known.

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3. Cash

4.

5.

Cash - operationsCash - capital campaignCash - casino



2018 2017

During the year, capital assets were acquired at an aggregate cost of $398,653, of which $398,653 were acquired by meansof a transfer of revenue from the deferred revenue capital campaign account to the unamortized capital contributionsaccount, with the related capital asset being capitalized and amortized over the term of the lease.

6. Long-term prepaid expenses

2018 2017

412,185 855,452

402,1937,4922,500

404,989418,256

32.207

Prepaid expenses

2018 2017

Leasehold 8,333 8,333Insurance 11,707 11,617

20,040 19,950

Leasehold balance is being amortized straight-line over the 15 year term of the lease.

Property and equipment

2018 2017Accumulated Net book Net book

Cost amortization value value

Computer equipment 45,855 44,828 1,027 2,054Equipment 16,656 14,990 1,666 4,997Office equipment 43,363 34,688 8,675 13,011Leasehold improvements 917,182 234,674 682,508 328,024

1,023,056 329,180 693,876 348,086

Leasehold 51,389

Leasehold balance is being amortized straight-line over the 15 year term of the lease.

59,722

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7. Deferred revenue

Deferred revenue represents unspent resources received in the current period that are related to the subsequent period.The deferred revenue balance consists of:

2018 2017

Palix Foundation - Supporting Fathers Involvement - First NationsParent LinkPalix Foundation - Supporting Fathers InvolvementCasino incomeLethbridge Early Years CoalitionCity of Lethbridge - FCSS fundingProgram and project incomeOther restricted contributionsDepartment of Indigenous Services Canada - Supporting Fathers Involvement - First NationsFamily and Community Safety Program - Supporting Fathers Involvement - First Nations

Deferred capital campaign revenue represents externally restricted capital contributions provided for a specific capitalpurpose that have been received by the Society, but the related expenditure has not been made at year-end. Theseunspent deferred capital allocations are not amortized until the expenditure has been made and it is at that time that thebalance is transferred to the unamortized capital contributions account. During the year, leasehold improvement werecompleted on the new West Lethbridge location and operations commenced as such the deferred capital campaignrevenue has been transferred to unamortized capital contributions and is being amortized over the term of the lease.

9. Unamortized capital contributions

Unamortized capital contributions consist of the unamortized amount of contributions received for the purchase of capitalassets. Recognition of these amounts as revenue is deferred to periods when the related capital assets are amortized.Changes in unamortized capital contributions are as follows:

2018 2017

Balance, beginning of yearAdditions from deferred revenue - capital campaignLess: Amounts recognized as revenue during the year

10. Internally restricted net assets

- 120,443- 58,823

34,190 36,9571,810 31,5166,665 18,704

- 13,6383,710 1,690

735 43279,951 -

61,773 -

8. Deferred revenue - Capital campaign

188,834 282,203

Balance, end of year 660,972 302,294

302,294398,653(39,975)

328,285

(25,991)

The Society has received donations from various donors and has restricted the use of these funds for future projects asdetermined by the Board of Directors.



11. Commitments

The Organization has a long term lease with respect to its office premises and parking stalls. The minimum annualpayments are as follows:

2019 123,9162020 123,9162021 153,6152022 153,6152023 153,615Thereafter 307,230

1,015,907

12. Economic dependence

The Society generates the majority of its revenue from Southern Alberta Child and Family Services, the Minister of Childrenand Youth Services and the City of Lethbridge and is dependent on these revenues for the operation of the Society’sprograms.

13. Financial instruments

The Organization, as part of its operations, carries a number of financial instruments. It is management’s opinion that theOrganization is not exposed to significant interest, currency, credit, liquidity or other price risks arising from these financialinstruments except as otherwise disclosed.

Credit concentration

As at March 31, 2018, two funding bodies (2017 - two) accounted for 51% (2017 - 39%) of the accounts receivable. TheOrganization believes that there is no unusual exposure associated with the collection of these receivables. TheOrganization performs regular credit assessments and provides allowances for potentially uncollectible accounts receivable.

14. Comparative figures

Certain comparative figures have been reclassified to conform with current year presentation. The prior year figures wereprepared by another accountant.

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family centre society of southern alberta financial

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