hopes therapeutic riding, inc. financial statements

IDGH HOPES THERAPEUTIC RIDING, INC.

Financial Statements

June 30, 2009 and 2008

Business Advisors and Certified Public Accountants

IDGH HOPES THERAPEUTIC RIDING, INC. Financial Statements

June 30, 2009 and 2008

Table of Contents

Independent Auditors' Report 1

Financial Statements:

Statements ofFinan.cial Position..................................................................................................... 2

Statements ofActivities and Changes in Net Assets 3

Statement ofFunctional Expenses.................................................................................................. 4

Statements of Cash Flows............................................................................................................... 5

Notes to Finan.cial Statements......................................................................................................... 6

Mariner Square, Suite 120 125 Eugene O'Neill DrivebQSTIN, New London, CT 06320Farmington • New London

Springfield, MA Main Line: (860) 442-4373 Toll Free: ( 8 8 8) 6 6 6 - KRCOR9&~~~ Fax: (860) 442-1124

Business Advisors and Certified Public Accountants Web: www.kostin.com

To The Audit Committee High Hopes Therapeutic Riding, Inc. Old Lyme, Connecticut

INDEPENDENT AUDITORS' REPORT

We have audited the accompanying statements of fmancial position of High Hopes Therapeutic Riding, Inc. (a non-profit organization) as of June 30, 2009 and 2008, and the related statements of activities and changes in net assets, functional expenses, and cash flows for the years then ended. These fmancial statements are the responsibility of High Hopes' management. Our responsibility is to express an opinion on these fmancial 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 audit to obtain reasonable assurance about whether the fmancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fmancial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the fmancial statements referred to above present fairly, in all material respects, the financial position of High Hopes Therapeutic Riding, Inc. as of June 30, 2009 and 2008, and the changes in its net assets, and cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

New London, Connecticut October 23, 2009

Members of: Leading Edge Alliance • Kreston International • American Institute of Certified Public Accountants • Private Companies Practice Section • Connecticut Society of Certified Public Accountants

An Equal Opportunity Employer

1

IDGH HOPES THERAPEUTIC RIDING, INC. Statements of Financial Position

June 30, 2009 and 2008

2009 2008 Assets

Current assets: Cash and cash equivalents $ 112,861 $ 97,814

Account and other receivables 43,947 44,986

Prepaid expenses 19,540 21,027

Unconditional promises to give 5,000 5,584

Total current assets 181,348 169,411

Property and equipment, net 1,855,365 1,948,296

Long-term assets: Cash and equivalents held for long-term purposes 469,669 537,336

Unconditional promises to give 49,176 56,176

Investments 1,604,769 1,990,063

Total long-term assets 2,123,614 2,583,575

Total assets $ 4,160,327 $ 4,701,282

Liabilities and Net Assets

Current liabilities: Accounts payable $ 21,552 $ 32,469

Accrued expenses 20,834 15,224

Advance fees for services 34,134 44,343

Total current liabilities 76,520 92,036

Net assets: Unrestricted 1,984,331 2,085,811

Unrestricted - Board designated 29,541 29,541

2,013,872 2,115,352

Temporarily restricted 808,185 1,232,144

Permanently restricted 1,261,750 1,261,750

Total net assets 4,083,807 4,609,246

Total liabilities and net assets $ 4,160,327 $ 4,701,282

The accompanying notes are an integral part of the fmancial statements 2

-------~--------------------------------------------I

- -

- -- -- -

- -- -- -- -

- -- -- -

Unrestricted

Support and revenues:

Support:

Contributions and grants $ 280,711

Special events 148,802

Total support 429,513

Revenues:

Fees for services 238,701

Other operating income 5,044

Total revenues 243,745

Total support and revenues 673,258

Net assets released from restrictions:

Restrictions satisfied by payments 204,921

Total support, revenue and reclassifications 878,179

Expenses:

Program 741,457

General and administrative 107,073

Fundraising 135,167

Total expenses 983,697

Changes in net assets from operations (105,518)

Other income (losses):

Investment income (loss) 7,463

Loss on fixed asset disposition (3,425)

Total other income (losses) 4,038

Changes in net assets (101,480)

Net assets, beginning of year 2,115,352

Net asset reclassification based upon change in law __

Net asset, end of year $ 2,013,872

HIGH HOPES THERAPEUTIC RIDING, INC.

Statements of Activities and Changes in Net Assets

For The Years Ended June 30, 2009 and 2008

2009 Temporarily Permanently

Restricted Restricted Total Unrestricted

$ 222,754 $ - $ 503,465 $ 352,873

4,464 - 153,266 199,732

227,218 - 656,731 ~52,605

- - 238,701 228,805

- - 5,044 7,585

- - 243,745 236,390

227,218 - 900,476 788,995

(204,921) - - 207,299

22,297 - 900,476 996,294

- - 741,457 728,644

- - 107,073 110,636

- - 135,167 128,368

- - 983,697 967,648

22,2~ _ - (83,221) 28,646

(446,256) - (438,793) (19,295)

- - (3,425) (20,177)

(446,256) - (442,218) (39,472)

(423,959) - (525,439) (10,826)

1,232,144 1,261,750 4,609,246 2,758,650

- - - (632,472)

$ 808,185 $ 1,261,750 s 4,083,807 $ 2,115,352

2008 Temporarily Permanently

Restricted Restricted

$ 170,941 $ 772

170,941 772

170,941 772

(207,299)

(36,358) 772

(36,358) 772

(36,358) 772

636,030 1,260,978

632,472

$ 1,232,144 s 1,261,750

$

$

Total

524,586

199,732

724,318

228,805

7,585

236,390

960,708

960,708

728,644

110,636

128,368

967,648

(6,940)

(19,295)

(20,177)

(39,472)

(46,412)

4,655,658

4,609,246

~ The accompanying notes are an integral part of the financial statements

HIGH HOPES THERAPEUTIC RIDING, INC. Statements of Functional Expenses

June 30, 2009 and 2008

J nne 30, 2009

Program

Personnel $ 402,733

Equine expenses 84,314

Programexpenses 39,567

Facilities 36,599

Insurance 47,707

Officeexpenses 34,264

Professional fees 3,168

Other expenses 313

General and Fund-Administrative Raising Total Program

$ 75,260 $ 114,034 $ 592,027 $ 395,142 $

84,314 72,685

39,567 40,327

2,376 742 39,717 35,279

3,442 634 51,783 50,568

1,829 8,676 44,769 32,540

15,277 176 18,621

1,400 8,597 10,310 7,734

June 30, 2008

Fund G&A Raising Total

69,471 $ 108,647 $ 573,260

72,685

40,327

2,385 736 38,400

3,552 749 54,869

1,655 10,444 44,639

23,942 23,942

2,015 5,445 15,194

Total expenses beforedepreciation 648,665 99,584 132,859 881,108 634,275 103,020 126,021 863,316

Depreciation 92,792 7,489 2,308 102,589 94,369 7,616 2,347 104,332

Total expenses $ 741,457 $ 107,073 $ 135,167 $ 983,697 $ 728,644 $ 110,636 $ $1282368 9672648

The accompanying notesare an integral partof the fmancial statements

4

IDGH HOPES THERAPEUTIC RIDING, INC. Statements of Cash Flows

For The Years Ended June 30,2009 and 2008

Cash flows from operating activities: 2009 2008

Changes in net assets Adjustments to reconcile changes in net assets to net cash

provided by operating activities: Depreciation expense Unrealized investment losses Realized investment losses Loss on fixed asset disposals (Increase) decrease in assets:

Accounts and other receivables Unconditional promises to give Prepaid expenses Deposits

Increase (decrease) in liabilities: Accounts payable Accrued expenses Advance fees for services

$ (525,439)

102,589 207,841 296,528

3,425

1,039 7,584 1,487

(10,917) 5,610

(10,209)

$ (46,412)

104,332 9,854

43,268 20,177

24,318 64,750 (2,753) 2,000

(14,604) 2,350 9,921

Net cash provided by operating activities 79,538 217,201

Cash flows from investing activities: Proceeds from the sale of investments Purchase of investments Purchase of property and equipment Proceeds from the sales of equipment

1,211,013 (1,330,088)

(13,083)

499,420 (452,611) (126,144)

2,500

Net cash used in investing activities (132,158) (76,835)

Net increase (decrease) in cash (52,620) 140,366

Cash, beginning of year 635,150 494,784

Cash, end of year $ 582,530 $ 635,150

The accompanying notes are an integral part of the fmancial statements 5

IDGH HOPES THERAPEUTIC RIDING, INC. Notes to Financial Statements


Note 1 - Summary of Significant Accounting Policies:

Nature of Operatiouls

High Hopes Therapeutic Riding, Inc. ("High Hopes") is a nonprofit charitable organization whose mission is to improve the lives of people with disabilities through the benefits of therapeutic horseback riding, equine assisted activities and therapies, and training and education while being a proactive leader, mentor and advocate for our profession. High Hopes is committed to providing efficient, safe, innovative and professional therapeutic riding programs to individuals with disabilities of all ages. High Hopes was founded on the belief that experiencing and riding horses in a secure, challenging and companionable environment will achieve this objective. The focus is on each participant's need to achieve meaningful gains in balance, coordination, strength, confidence and selfrespect.

Basis of Presentation

The accompanying financial statements are presented on the accrual basis of accounting.

The accompanying fmancial statements of High Hopes are presented in accordance with Statement of Financial Accounting Standards (SFAS) No. 117, Financial Statements of Not-for-Profit Organizations. Under SFAS No. 117, High Hopes is required to report information regarding its fmancial position and activities according to three classes of net assets: unrestricted net assets, temporarily restricted net assets, and permanently restricted net assets. In addition, High Hopes is required to present a statement of cash flows.

To ensure observance of limitations and restrictions placed on the use of resources available to High Hopes, the accounts ofHigh Hopes are maintained in the following net asset categories:

Unrestricted - Unrestricted net assets represent available resources other than donor-restricted contributions.

Temporarily Restricted - Net assets subject to donor-imposed stipulations that mayor will be met, either by actions ofHigh Hopes and/or the passage of time. When a restriction expires, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statements of activities as net assets released from restrictions.

Permanently Restricted - Net assets subject to donor-imposed stipulations that they be maintained permanently by High Hopes. Generally, the donors of these assets permit High Hopes to use all or part of the income earned on any related investments for general purposes.

Cash and Cash Equivalents

For purposes of the statements of cash flows, cash and cash equivalents include all highly liquid debt instruments purchased with a maturity of three months or less.

6



Note 1 - Summary of Significant Accounting Policies: (Continued)

Recognition of Support and Revenue

In accordance with the recommendations of Statement of Financial Accounting Standards (SFAS) No. 116, Accounting for Contributions Received and Contributions Made, unrestricted and unconditional contributions are recognized as support when received or pledged, if applicable. Contributions are reported as temporarily restricted support if they are received with donor stipulations that limit the use of such assets.

High Hopes reports gifts of land, buildings, and equipment as unrestricted support unless explicit donor stipulations specify how the donated assets must be used. Gifts of long-lived assets with explicit restrictions that specify how the assets are to be used and gifts of cash or other assets that must be used to acquire long-lived assets are reported as temporarily restricted support. Absent explicit donor stipulations about how long-lived assets must be maintained, High Hopes reports expirations of donor restrictions in full when the donated or acquired long-lived assets are placed in service.

Fees for Services - Fee income is recognized at the time the service is provided.

Grants - Grants are generally considered to be exchange transactions in which the grantor or contractor requires the performance of specified activities.

Contributions - Contributions are defmed as voluntary, non-reciprocal transfers.

Donated Services - Donated services are recognized in accordance with SFAS No. 116, Accounting for Contributions Received and Contributions Made, if the services create or enhance nonfinancial assets or require specialized skills, are performed by people with those skills, and would otherwise be purchased by High Hopes. These services are used in program, administrative and fundraising activities. Many individuals also volunteer their time and perform a variety of tasks that assist High Hopes with program, administrative and fundraising duties and various committee assignments throughout the year that are not recognized as contributions in the fmancial statements since the recognition criteria under SFAS No. 116 were not met. High Hopes receives approximately 33,000 volunteer hours per year (see Note 1, Nature of Operations); 63% of these hours are given by adults 21 and over, whose time is valued at $420,998 (2008 $20.25 x 20,790) using valuation guidelines established for the Independent Sector by the Bureau of Labor Statistics.

Donated Assets - Donated assets are recognized at their estimated fair market value.

Income Tax Status

High Hopes qualifies as a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code and, therefore, has no provision for federal income taxes.

High Hopes has elected to defer the provisions ofFIN 48, Accounting for Income Taxes, under the provisions of FSP FIN 48-3. High Hopes uses a FAS 5, Loss Contingencies, approach for evaluating uncertain tax positions. High Hopes continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings.

7

mGH HOPES THERAPEUTIC RIDING, INC. Notes to Financial Statements



Accounts and Other Receivables

Accounts and other receivables are stated at the amount management expects to collect from outstanding balances. Management monitors outstanding receivables and charges off to expense all balances that are determined to be uncollectible. High Hopes has not established an allowance for uncollectible accounts as it is management's opinion that uncollectible accounts are not material to the overall fmancial statements.

Property and Equipment

Property and equipment that are deemed to be of a permanent and lasting nature are capitalized at cost, or, in the case of property donated, at estimated fair market value.

Property and equipment are stated at cost. Depreciation is computed utilizing the straight-line method over the estimated useful lives of the respective assets. Maintenance and repairs are charged to operations when incurred. Betterments and renewals are capitalized. When property and equipment are sold or otherwise disposed of, the asset account and related accumulated depreciation account are relieved, and any gain or loss is included in operations.

The estimated useful lives of High Hopes' assets are as follows:

Buildings and improvements 30 - 40 years Land improvements 10 - 20 years Furniture and equipment 3 - 12 years Horses 5 years Software 3 - 5 years

Off Balance Sheet Risk

On October 3, 2008, the Emergency Economic Stabilization Act of 2008 increased the insurance coverage offered by the Federal Deposit Insurance Corporation (FDIC) from $100,000 to $250,000 per depositor. This limit is anticipated to return to $100,000 after December 31,2013. Additionally, under the FDIC's Temporary Liquidity Guarantee Program, amounts held in non-interest bearing transaction accounts at participating institutions are fully guaranteed by the FDIC through December 31, 2009. This guarantee is anticipated to be reduced to the $250,000 limit on January 1, 2010, and the $100,000 limit on January 1, 2014. At no point during the year did the Organization have amounts in excess of $250,000 in a single bank, which are not insured by the FDIC. These balances fluctuate during the year and can exceed this $250,000 limit.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. The valuations of unconditional promises to give and beneficial interest in trust are based on estimates of the present value of future cash flows. It is at least reasonably possible that these estimates may change in the near term and the effect of the change could be material.

8




Expense Allocation

The costs of providing various programs and other activities have been summarized on a functional basis in the Statements of Activities and Changes in Net Assets and in the Statements of Functional Expenses. Accordingly, certain costs have been allocated among the programs and supporting services benefited using estimates. General and administrative expenses include those expenses that are not directly identifiable with any other specific function but provide for the overall support and direction ofHigh Hopes.

Investments

High Hopes follows SFAS No. 124, Accounting for Certain Investnlents Held by Not-for-Profit Organizations. Under SFAS No. 124, investments in marketable securities with readily determined fair values and all investments in debt securities are stated at their fair values in the Statements of Financial Position.

Subsequent Events

Management has reviewed subsequent events through October 23, 2009, the date at which the statements were approved and available for issuance.

Note 2 - Unconditional Promises to Give:

Unconditional promises to give are recorded at the estimated net realizable present value of the expected future cash flows. The present value was calculated using a twenty-eight percent discount rate. The amounts receivable are as follows:

2009 2008

Unrestricted Temporarily restricted Permanently restricted

$ 15,000

50,000

$ 20,000 2,584

50,000

Total unconditional promises to give Discount for future payments

65,000 10,824

72,584 10,824

Net amount receivable $ 54,176 $ 61,760

The maturities of these receivables at their net present value are as follows:

Due In Amount

Within one year One to five years More then five years

$ 5,000 10,000 39,176

$ 54,176

9



Note 3 - Beneficial Interest in Trust:

High Hopes is the remainder beneficiary of a charitable remainder trust administered by a third party. A charitable remainder trust provides for the payment of distributions to the grantor or other designated beneficiaries over the trust's term (usually the designated beneficiary's lifetime). At the end of the trust's term, the remaining assets are available for High Hopes' use. The portion of the trust attributable to the estimated present value of the future benefits to be received by High Hopes was recorded on the Statements of Activities and Changes in Net Assets as a permanently restricted contribution in the period the trust was established. Each year this estimate is revalued based upon current assumptions and the beneficial interest is adjusted accordingly. A five percent discount rate is used to estimate the remainder value. This asset is included with unconditional promises to give at its estimated net present value of$39,176 for June 30, 2009 and 2008.

Note 4 - Defined Contribution Plan:

High Hopes established a 403(b) retirement plan during 2002 which is available to all employees. The plan allows employees to defer a portion of their annual compensation as defmed annually by law. Currently, employees under age 50 may defer up to $15,500 of their annual compensation and employees age 50 and older may defer up to $20,500 of their annual compensation. Commencing with the 2006-2007 fiscal year, High Hopes can match employee contributions up to 2% of their salaries. The total matching for the years ending June 30, 2009 and 2008 was $6,694 and $5,801, respectively. Each participant self-directs the investment of their own account.

Note 5 - Investments:

At June 30, 2009, High Hopes' investments consisted ofthe following:

Fair Unrealized Value Cost Gain(Loss)

Investments: Corporate bonds $ 128,090 $ 122,511 $ 5,579 Equities 250,734 228,946 21,788 Mutual funds 1,225,945 1,326,666 ( 100,721)

Total investments $ 1,604,769 $ 1,678,123 $( 73,354)

At June 30, 2008, High Hopes' investments consisted ofthe following:

Fair Unrealized Value Cost Gain

Investments: Corporate bonds $ 126,200 $ 121,435 $ 4,765 Equities 430,832 285,474 145,358 Mutual funds 1,433,031 1,418,896 14,135

Total investments $ 1,990,063 $ 1,825,805 $ 164,258

10



Note 5 - Investments: (Continued)

The following schedule summarizes the investment return and its classification in the Statements of Activities and Changes in Net Assets for the years ended June 20, 2009 and 2008:

2009 2008

Interest and dividends Unrealized losses Realized losses

$ ( (

65,576 207,841) 296,528)

$ 133,376 ( 109,403) ( 43,268)

Total investment loss $( 438,793) $( 19,295)

Note 6 - Fair Value of Financial Instruments:

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements, in order to establish a single defmition of fair value and a framework for measuring fair value in generally accepted accounting principles (GAAP) that is intended to result in increased consistency and comparability in fair value measurements. SFAS No. 157 also expands disclosures about fair value measurements. SFAS No. 157 applies whenever other authoritative literature requires (or permits) certain assets or liabilities to be measured at fair value, but does not expand the use of fair value. SFAS No. 157 was originally effective for fmancial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those years with early adoption permitted.

In early 2008, the FASB issued Staff Position (FSP) FAS-157-2, Effective Date ofFASB Statement No. 157, which delays by one year the effective date of SFAS No. 157 for all non-fmancial assets and non-financial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). The delay pertains to items including, but not limited to, non-fmancial assets and nonfmancialliabilities initially measured at fair value in a business combination, non-fmancial assets (such as real estate or donations in kind) recorded at fair value at the time of donation, and long-lived assets measured at fair value for impairment assessment under SFAS No. 144, Accounting for the Impairment or Disposal of LongLived Assets.

High Hopes plans to adopt the portion of SFAS No. 157 that has not been delayed by FSP FAS-157-2 as of the beginning of its 2009 fiscal year, and plans to adopt the balance of its provisions as of the beginning of its 2010 fiscal year. Items carried at fair value on a recurring basis (to which SFAS No. 157 applies in 2009) consist of fmancial instruments which are valued primarily based on quoted prices in active or brokered markets for identical as well as similar assets and liabilities. Items carried at fair value on a non-recurring basis (to which SFAS No. 157 will apply in 2010) generally consist of assets held for sale. High Hopes also uses fair value concepts to test various long-lived assets for impairment. High Hopes is continuing to evaluate the impact the standard will have on the determination of fair value related to non-financial assets and non-financial liabilities in post-2009 years.

Financial assets and liabilities valued using level 1 inputs are based on unadjusted quoted market prices within active markets. Financial assets and liabilities valued using level 2 inputs are based primarily on quoted prices for similar assets or liabilities in active or inactive markets. Financial assets and liabilities using level 3 inputs were primarily valued using management's assumptions about the assumptions market participants would utilize in pricing the asset or liability. Valuation techniques utilized to determine fair value are consistently applied.

11



Note 6 - Fair Value of Financial Instruments: (Continued)

Fair values of assets and liabilities measured on a recurring basis at June 30, 2009 are as follows:

Fair Value Measurements at Reporting Date Using

Quoted Prices

Fair Value

In Active Markets for

Identical Assets/Liabilities

(Levell)

Significant Other

Observable Inputs

(Level 2)

Significant Unobservable

Inputs (Level 3)

June 30, 2009 Equities Bond mutual funds Equity mutual funds

$ 378,824 603,433 622,512

$ 378,824 603,433 622,512

$ $

$ 1,604,769 $ 1,604,769 $ $

Note 7 - Property and Equipment:

Property and equipment consist of the following at June 30, 2009 and 2008:

2009 2008

Land and improvements Building and improvements Trucks, tractors and bam equipment Software, office equipment and furnishings Horses Saddles, tack and equipment

$ 734,735 1,703,845

149,699 216,988

43,018 10,835

$ 735,011 1,714,031

154,875 217,477

42,519 10,835

Less: accumulated depreciation 2,859,120 1,003,755

2,874,748 926,452

Net property and equipment $ 1,855,365 $ 1,948,296

Note 8 - Development Restrictions:

The land owned and used by High Hopes is located in Old Lyme, Connecticut. A large portion is subject to an easement which restricts the property to agricultural use and limits the total square footage of buildings that may be constructed.

12



Note 9 - Special Events:

High Hopes holds several fundraising events throughout the year. Revenue is generated by sponsorships, ticket sales, and the sales of donated items. All revenue generated above the value of the basic ticket is considered a contribution. Activity for the years ended June 30, 2009 and 2008 is as follows:

2009 2008

Contributions and sponsorships $ 214,656 $ 219,995 Ticket sales 44,816 49,050

Total revenue 259,472 269,045 Less: cost of events 106,206 69,313

Net revenue from special events $ 153,266 $ 199,732

Note 10 - Temporarily Restricted Net Assets:

Temporarily restricted net assets available for the following purposes at June 30, 2009 and 2008 were:

2009 2008

Capital (1) $ 305,640 $ 310,551 Scholarship (2) 198,915 155,942 Programs (3) 30,113 21,980 Endowment (4) 177,267 632,472 Other (5) 96,250 111,199

$ 808,185 $ 1,232,144

(1) Net assets committed for capital acquisitions. (2) Net assets committed for the following year. (3) Net assets committed for specific program purposes. (4) Net assets committed for endowment purposes - accumulated investment earnings. (5) Net assets committed for other specific purposes.

Net assets were released from restrictions by incurring ~xpenses satisfying the restricted purposes or by occurrence of other events specified by donors or grantors during the year.

Note 11- Endowment:

On October 1, 2007, the State of Connecticut adopted the Uniform Prudent Management of Investment Funds Act ("UPMIFA") which governs the investment and management of donor-restricted endowment funds by notfor-profit organizations. In addition, the Financial Accounting Standards Board ("FASB") issued a staff position to provide guidance on the net asset classification of endowment funds that are subject to UPMIFA. This FASB staff position, FSP FAS 117-1, Endowments of Not-for-Profit Organizations: Net Asset Classification of Funds Subject to an Enacted Version of "UPMIFA", and Enhanced Disclosures for All Endowment Funds, has been adopted by High Hopes as of October 1, 2007.

13



Note 11 - Endowment: (Continued)

The required disclosures are as follows:

Endowment Net Asset Composition by Type of Fund as of June 30,2009

Unrestricted Temporarily

Restricted Permanently

Restricted Total

Donor-restricted endowment funds Board-designated endowment funds

$ $ $1,261,750 177,267

$ 1,261,750 177,267

Total funds $ $ 177,267 $ 1,26'1,750 $ 1,439,017

Change in Endowment Net Assets for the Year Ended June 30, 2009

The Board of Trustees of High Hopes have interpreted the State of Connecticut Uniform Prudent Management of Institutional Funds Act (UPMIFA) as requiring the preservation of the fair value of the original gift as of the gift date of the donor-restricted endowment funds absent explicit donor stipulations to the contrary. As a result of this interpretation, High Hopes classifies as permanently restricted net assets (a) the original value of gifts donated to the permanent endowment, (b) the original value of subsequent gifts to the permanent endowment, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. The remaining portion of the donorrestricted endowment fund that is not classified in permanently restricted net assets is classified as Board designated temporarily restricted net assets until those amounts are appropriated for expenditure by High Hopes in a manner consistent with the standard of prudence prescribed by UPf\1IFA.

14

mGH HOPES THERAPEUTIC RIDING, INC. Notes to Financial Statements


Note 11- Endowment: (Continued)

In accordance with UPMIFA, High Hopes considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds:

(1) The duration and preservation of the fund (2) The purposes of High Hopes and the donor-restricted endowment fund (3) General economic conditions (4) The possible effect of inflation and deflation (5) The expected total return from income and the appreciation of investments (6) Other resources of High Hopes (7) The investment policies ofHigh Hopes

Note 12 - Reclassification:

Certain reclassifications were made to the 2008 fmancial statements for comparative purposes to conform with the presentation in the current year fmancial statements.

15

hopes therapeutic riding, inc. financial statements

Documents