LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2014 AND 2013
125 South Wacker Drive • 10th Floor • Chicago, Illinois 60606-4433 E-mail: bwrnail@brookweiner.com •Web: www.brookweiner.com 312/629-0900 • Fax 312/629-0901
INDEPENDENT AUDITOR'S REPORT To those Charged with Governance of Leave No Veteran Behind, Inc. Chicago, Illinois We have audited the accompanying financial statements of Leave No Veteran Behind, Inc. (a nonprofit organization), which comprise the statements of financial position as of December 31, 2014 and 2013, and the related statements of activities and cash flows for the years then ended , and the related notes to the financial statements. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes 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 Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit 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 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. The procedures selected depend on the auditor's 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 the entity's preparation and fair presentation of the financial statements 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 the entity's internal control. Accordingly, we express no such opinion . An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, 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 referred to above present fairly, in all material respects , the financial position of Leave No Veteran Behind, Inc. as of December 31, 2014 and 2013 , and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.
Chicago, Illinois November 30, 2015
~ U<.c . ...~ ._
L L C.
LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) STATEMENTS OF FINANCIAL POSITION
ASSETS December 31 , 2013
2014 CURRENT ASSETS Cash and cash equivalents Accounts receivable Total current assets
$
FURNITURE AND EQUIPMENT, NET
34,364 100,189 134,553
$
92,731 85,442 178,173 2,255
4,209
Total assets
$
138,762
$
180,428
$
9,619 38,790 20,788 69,197
LIABILITIES AND NET ASSETS (DEFICIT) CURRENT LIABILITIES Accounts payable Accrued liabilities Current portion of long-term debt Total current liabilities
$
LONG-TERM DEBT, NET OF CURRENT PORTION
NET ASSETS (DEFICIT) Unrestricted
$
Total liabilities and net assets (deficit)
9,946 98,025 15,000 122,971 135,000
150,000
(119,209)
(38,769)
138,762
$
180,428
See Independent Auditors' Report and Notes to Financial Statements.
BROOKWEINER L.L.C.
-2-
LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) STATEMENT OF ACTIVITIES
Administrative REVENUE Contract services $ Corporate contributions Individual contributions Foundation contributions Foundation grants In kind Total revenue before restrictions Revenue released from restrcitions Total revenue
142,536 $
1,282,820 $ 140,448 45,635 3,000
$ 15,717
1,425,356 $ 140,448 61,352 3,000
Total
$
100,000
143,382
1,476,697
15,717
1,635,796
100,000
25,000 168,382
75,000 1,551,697
100,000 1,735,796
(100,000)
15,717
22,638 17,600
90,551 70,398 914,807 201,455 54,953
113,189 87,998 914,807 201,455 56,741
113,189 87,998 914,807 201,455 56,741
7,995 40,508 48,962 18,723 41,289
9,994 41,559 48,962 18,723 46,631
9,994 41,559 48,962 18,723 46,631
53,460 56,352 2,755 21,413 93,919
53,460 56,352 2,755 21,413 93,919
7,979 1,460 548 22,631 5,640
7,979 1,460 548 22,631 5,640
3,888 6,132 1,816,236
3,888 6,132 1,816,236
1,788 1,999 1,051
5,342
Telephone and internet services Professional fees Interest and bank charges Office supplies Travel and meals
26,997 27,038 827 861 42,130
22,453 1,928 20,519 14,221
5,640
1,425,356 140,448 61,352 3,000 100,000 5,640
4,794
Payroll processing fees Rent Other program expense Education schlolarship Insurance
4,010 29,314 33 37,568
4,165 1,460
2,029
548 4,175 846
9,742 4,794
8,714
1,840 157,465
3,888 4,292 1,577, 103
Auto expense Training Computer Miscellaneous In-Kind
1,785
CHANGE IN NET ASSETS $
10,917 $
(25,406) $
81 ,668
(65,951) $
NET ASSETS (DEFICIT) - ENDING
(80,440)
1,735,796
1,735,796
$
$
(119,209) $
L.L.Csee Independent Auditors' Report and Notes to Financial Statements. -3-
(80,440) (38,769)
(3 8,769}
NET ASSETS (DEFICIT) - BEGINNING
BROOKWEINER
Temporarily Restricted
846
EXPENSES Officers' salaries Other salaries Veteran-provided services Youth-provided services Payroll taxes
Bad debt Depreciation Total expenses
Year ended December 31 , 2014 Unrestricted Fundraising Total Program
$
(119,209)
LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) STATEMENT OF ACTIVITIES
Administrative REVENUE Contract services $ Corporate contributions Individual contributions Foundation contributions Foundation grants In kind Total revenue before restrictions Revenue released from restrictions Total revenue
EXPENSES Officers' salaries Veteran-provided services Youth-provided services Payroll taxes Payroll processing fees
127,403 $
Year ended December 31 , 2013 Unrestricted Program Fundraising Total 721,952 $ 95,531 158,747 34,129 50,000
$
849,355 $ 95,531 158,747 34, 129 50,000
Temporarily Restricted
Total
120,000
849,355 95,531 158,747 34,129 170,000
1,307,762
$
127,403
1,060,359
1,187,762
120,000
18,000 145,403
102,000 1, 162,359
120,000 1,307,762
{1 20,000}
23,831
95,325 698,351 212,201 34,746 4,938
119, 156 698,351 212,201 35,589 7,054
119,156 698,351 212,201 35,589 7,054
843 2,116
1,307,762
Rent Other program expense Education schlolarship
5,970
13,930 23,126 14,228
19,900 23,126 14,228
19,900 23,126 14,228
Insurance Telephone and internet services Professional fees Interest and bank charges Office supplies
9,962
23,244
33,206
33,206
4,552 18,074 2,809 7,387
10,621 38,407 6,555 17,236
15,173 56,481 9,364 24,623
15, 173 56,481 9,364 24,623
10,376 692 12,683 1,844 851 101,990
7,992 339 29,594 672 1,985 1,233,490
34,586 2,305 42,277 6,146 2,836 1,356,602
34,586 2,305 42,277 6,146 2,836 1,356,602
Travel and meals Auto expense Training Miscellaneous Depreciation Total expenses
CHANGE IN NET ASSETS $
43,413 $
{71, 131 } $
16,218 1,274 3,630 21 ,122
{21,122} $
(48,840)
$
10,071
NET ASSETS - BEGINNING NET ASSETS (DEFICIT) - ENDING
$
(38,769) $
BROOKWEINER L.L.CDee Independent Auditors' Report and Notes to Financial Statements. -4 -
(48,840) 10,071
$
(38,769)
LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) STATEMENTS OF CASH FLOWS
Years Ended December 31, 2013 2014 CASH FLOWS FROM OPERATING ACTIVITIES Change in net assets (deficit) Adjustments to reconcile change in net assets to net cash used in operating activities Depreciation Change in assets and liabilities (Increase) in accounts receivable Decrease in prepaid expenses Increase in accounts payable Increase in accrued liabilities Total adjustments
$
(80,440)
$
(48,840)
6,132
2,836
(14,747) 327 59,235 50,947
(43,283) 4,000 9,619 16,290 (10,538)
Net cash (used in) operating activities
(29,493)
(59,378)
CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property & equipment
(8,086)
(2,238)
(8,086)
(2,238)
(20,788)
150,000 (30,077)
(20,788)
119,923
(58,367)
58,307
92,731
34,424
Net cash (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds on long-term debt Payments on long-term debt Net cash (used in) provided by financing activities NET INCREASE (DECREASE) IN CASH CASH AND CASH EQUIVALENTS - BEGINNING
$
34,364
$
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash paid during the year for interest $
4,352
$
CASH AND CASH EQUIVALENTS- ENDING
See Independent Auditors' Report and Notes to Financial Statements. -5-
BROOKWEINER L.L.C.
92,731
3,460
=====
LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2014 AND 2013
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Operations Leave No Veteran Behind, Inc. (the Organization) is an Illinois not-for-profit corporation. The Organization provides educational and employment services to veterans who face economic hardship. Through its innovative educational debt relief scholarship, community service, employment training, and job placement programs, the Organization invests in heroes who have honorably served our Nation and seek to continue their service as productive citizens in their communities. Basis of Presentation The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. In accordance with these principles, the Organization adheres to guidance provided by Accounting Standards Codification (ASC) No. 958-205. Under ASC 958-205, "Presentation of Financial Statements", the Organization, if applicable, is required to report information regarding its financial position and activities according to three classes of net assets, namely unrestricted, temporarily restricted and permanently restricted. Support that is restricted by donors as being available only in future accounting periods, is reported as restricted support. Additionally, promises to give or pledges are recognized when the conditions of the promise or pledge have been substantially met by the Organization. Revenue and Expense Recognition The financial statements of the Organization have been prepared on the accrual basis of accounting applying the standards promulgated by the American Institute of Certified Public Accountants Audit Guide for Non-Profit Organizations. Accordingly, all significant receivables, payables, and other liabilities have been reflected . Additionally, revenue is recognized when earned and expenses are recognized when incurred. Support Recognition Contributions, received or pledged, are recorded as unrestricted unless specifically restricted by the donor. All donor-restricted contributions are reported as an increase in temporarily restricted net assets and are transferred to unrestricted net assets as the restrictions are met. In-Kind The value of in-kind at December 31, 2014 recorded at $5,640 was for rent and computer expense. For the year ended December 31, 2013 the Organization had no in-kind. Estimates The financial statements have been prepared in accordance with generally accepted accounting principles and necessarily include amounts based on estimates and assumptions made by management. Actual results could differ from those estimates.
BROOKWEINER L.L.C.
-6-
LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2014 AND 2013
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Functional Expenses
The Organization allocates its expenses on a functional basis among its various programs. Expenses that can be identified with a specific program are allocated according to their natural expenditure classification . Other expenses that are common to several functions are allocated by various formulas. Accounts Receivable
Accounts receivable represent amounts due from service contracts entered into with governmental agencies (not subject to OMB Circular A-133 audit requirements) and are stated at the unpaid balances, less any allowance for doubtful accounts. It is the Organization's policy to charge off uncollectible accounts receivable when management determines the receivable will not be collected . At December 31, 2014 and 2013, there was no balance in the allowance for doubtful accounts as the Organization determined the outstanding balance was fully collectible. Cash and Cash Equivalents
Cash and cash equivalents consist primarily of cash on deposit and money market accounts that are readily convertible into cash and purchased with original maturities of three months or less.
NOTE B - PROPERTY AND EQUIPMENT Purchases in excess of $500 are considered for capitalization. Property and equipment are recorded at cost and depreciated over the estimated lives (3 years) of the assets using the straightline method. The asset cost and related accumulated depreciation are as follows: 2014 2013 Property and equipment Accumulated depreciation
$ 19,369 (15,160)
$ 11,282 (9,027)
Net book value
$
$ 2.255
4,209
Depreciation expense for the years ended December 31, 2014 and 2013 was $6, 132 and $2,836.
BROOKWEINER L.L.C.
-7-
LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2014 AND 2013
NOTE C - LONG-TERM DEBT The Organization has an unrestricted "program related investment" loan from a local foundation. This is an interest free loan. As of December 31, 2014 and 2013, the outstanding balance was $150,000. According to the debt agreement, the principal is to be repaid in ten annual installments of $15,000 due on or before December 15 of each year commencing in 2015. The Organization has a commercial loan with a local financial institution. The applicable interest rate is the sum of the Prime Rate (3.25% for both 2014 and 2013) plus 4.5%, per annum. The Organization pays $1,000 monthly towards the principle balance. The loan was fully paid off during 2014. As of December 31 , 2014 and 2013 the balance was zero and $20,788, respectively.
NOTED - INCOME TAX STATUS The Organization is a not-for-profit 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. Due to its tax-exempt status, the Organization is not subject to U.S. federal or state income taxes . The Organization's management believes that the tax positions taken would be upheld under an examination. Therefore, no provision for the effects of uncertain tax positions has been recorded.
NOTE E - TEMPORARILY RESTRICTED NET ASSETS During fiscal year 2014, the Organization received a grant of $75,000 in support of the 2014 Workforce Empowerment Program and a grant of $25,000 for the purpose of understanding the impact of student loan debt on student veterans. During fiscal year 2013, the Organization received a grant of $120,000 in support of the Summer Youth Employment Program. During 2014 and 2013, the Organization complied with the grant terms and, as such, the revenue was released from restriction .
BROOKWEINER L.L.C.
-8-
LEAVE NO VETERAN BEHIND, INC. (AN ILLINOIS NOT-FOR-PROFIT CORPORATION) NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2014 AND 2013
NOTE F-CONCENTRATION OF ACCOUNTS RECEIVABLE AND REVENUE The Organization received 70% and 54% of total revenue in 2014 and 2013 from a service contract with a governmental agency. All of the accounts receivable outstanding at the end of the year were due from this agency. A contract with another governmental agency exceeded 13% of total revenue in 2014.
NOTE G - RENT EXPENSE The Organization rents a facility on an as-need basis for program events. Rent expense amounted to $41,559 and $19,900 for the years ended December 31, 2014 and 2013, respectively. NOTE H - RECLASSIFICATIONS Certain accounts in the prior-year financial statements have been reclassified for comparative purposes to conform with the presentation in the current-year financial statements.
NOTE I - SUBSEQUENT EVENTS The Organization has evaluated subsequent events through November 30, 2015, the date the financial statements are available to be issued. The annual service contract with the Organization's largest customer commencing August 2015 has decreased to 30% of the total 2014 annual contract value. The Organization foresees to proportionately reduce contract related expenses.
BROOKWEINER L.L.C.
-9-