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Statement of Cash Flows
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2016
2016 2015
OPERATING ACTIVITIES
Deficiency of revenues over expenditures $ (2,571) $ (59,687)
Change in non-cash working capital items Accounts receivable (13,294) 2,893 Prepaid expenses (500) 1,706 Due from government agencies (2,233) (35) Accounts payable and accrued liabilities (4,269) 13,569 Due to government agencies - (17,306) Deferred revenue 4,493 -
NET DECREASE IN CASH
CASH, beginning of year
CASH, end of year
(18,374) (58,860)
71,254 130,114
$ 52,880 $ 71,254
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2016
1. NATURE OF OPERATIONS
Canadian Association of Pregnancy Support Services ("CAPSS") is a not-for-profit organization whose purpose is to encourage leadership excellence in pregnancy care centres across Canada. CAPSS is incorporated under the laws of the Province of Ontario and is exempt from income tax under the Income Tax Act of Canada.
2. BASIS OF PRESENTATION
These financial statements are prepared in accordance with Canadian accounting standards for not-for-profit organizations. CAPSS follows the restricted fund method of accounting for contributions.
1. General Fund:
The purpose of the General Fund is to record the assets, liabilities, revenue and expenses that are related to the general operating and administrative activities of the organization.
3. SIGNIFICANT ACCOUNTING POLICIES
(a) Revenue recognition
The organization follows the deferral method of accounting for contributions. Restricted contributions are recognized as revenue in the year in which the related expenses are incurred. Unrestricted contributions are recognized as revenue when received or receivable if the amount to be received can be reasonably estimated and collection is reasonably assured. Endowment contributions are recognized as direct increases in net assets.
Restricted investment income is recognized as revenue in the year in which the related expenses are incurred. Unrestricted investment income is recognized as revenue when earned.
Externally restricted contributions for the purchase of capital assets that will be amortized are recorded as deferred capital contributions and recognized as revenue on the same basis as the amortization expense related to the acquired capital assets. Externally restricted contributions for the purchase of capital assets that will not be amortized are recognized as direct increases in net assets to the Investment in Capital Assets balance.
(b) Cash and cash equivalents
Cash and cash equivalents are defined as cash and highly liquid investments, consisting primarily of term deposits, with terms to maturity of three months or less at the date of purchase.
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2016
3. SIGNIFICANT ACCOUNTING POLICIES, continued
(c) Contributed services
Directors, committee members and owners volunteer their time to assist in the corporation's activities. While these services benefit the corporation considerably, a reasonable estimate of their amount and fair value cannot be made and, accordingly, these contributed services are not recognized in the financial statements.
(d) Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated amortization. Amortization is provided annually at rates calculated to write-off the assets over their estimated useful lives. Management reviews the estimates of useful life of the assets every year and adjusts them on a prospective basis if needed. Property, plant and equipment are amortized over their estimated useful lives at the following rates and methods:
Furniture and fixtures 20%
Amortization of leasehold improvements is recorded over the remaining term of the lease plus the first renewal option.
Property, plant and equipment are reviewed for impairment whenever events or changes in the circumstances indicate that the carrying value may not be recoverable. If the total of the estimated undiscounted future cash flows is less than the carrying value of the asset, an impairment loss is recognized for the excess of the carrying value over the fair value of the asset during the year the impairment occurs.
(e) Use of estimates
The preparation of financial statements in conformity with Canadian accounting standards for not-for-profit organizations requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. By their nature, these estimates are subject to measurement uncertainty. The effect of changes in such estimates on the financial statements in future periods could be significant. Accounts specifically affected by estimates in these financial statements are deferred revenue, property, plant and equipment, and amortization expense.
(f) Donated material and services
Donated capital and investments are recorded in the financial statements at fair value on the date of the donation. Donated materials and services are not recorded because the fair market value is not readily determinable. With the exception of volunteer time, such material and services are not significant.
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2016
4. PROPERTY, PLANT AND EQUIPMENT
2016 2015
Cost Accumulated Amortization Net Net
Furniture and fixtures $ 11,969 $ 11,969 $ - $ Leasehold improvements 15,098 15,098 - -
$ 27,067 $ 27,067 $ - $ -
5. COMPARATIVE FIGURES
The financial statements have been reclassified, where applicable, to conform to the presentation used in the current year. The changes do not affect prior year earnings.
6. FINANCIAL INSTRUMENTS
The organization's financial instruments consist of cash, accounts receivable, and accounts payable. The significant financial risks to which the company is exposed to are currency risk and interest risk.
(a) Fair value
The fair value of current financial assets and current financial liabilities approximates their carrying value due to their short-term maturity dates.
(b) Credit risk
The organization does have credit risk in accounts receivable of $13,294 (2015 - $-). Credit risk is the risk that one party to a transaction will fail to discharge an obligation and cause the other party to incur a financial loss. The organizationreduces its exposure to credit risk by performing credit valuations on a regular basis; granting credit upon a review of the credit history of the applicant and creating an allowance for bad debts when applicable. The organization maintains strict credit policies and limits in respect to counterparties. In the opinion of management the credit risk exposure to the organization is low and is not material.
