Independent Auditor's REPORT
Total Page:16
File Type:pdf, Size:1020Kb
THE FOOD Depository’S FISCAL YEAR: AT-A-GLANCE INDEPENDENT AUDITOR’S Report Where Food Depository food is distributed Member Agencies and Clients Board of Directors Sum of Weight in Pounds The Food Depository works with a network Greater Chicago Food Depository of about 600 member, soup kitchens, Chicago, Illinois City of Chicago – Department of Human Services Sites: 2% food pantries, shelters, low-income Producemobiles: 13% daycare centers, group homes and programs throughout Cook County. A study Other Programs: 3% released during the last fiscal year found We have audited the accompanying statements of financial position of Greater Chicago Food Depository (GCFD) as of June 30, 2006 and 2005, and the related statements of activities, functional expenses, and cash flows for the years then ended.T hese financial Group Homes and Shelters: 9% that almost 500,000 people every year rely on food from the Food Depository. statements are the responsibility of GCFD’s management. Our responsibility is to express an opinion on these financial statements Children’s Programs: 3% based on our audits. Soup Kitchens: 5% We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the standards Food Pantries: 65% applicable to financial audits contained in GovernmentA uditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.A n 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. How the Food Depository uses its resources Efficiency and Impact In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Greater Chicago Operating Expenses Because of numerous partnerships and Food Depository as of June 30, 2006 and 2005, and the changes in its net assets and its cash flows for the years then ended in organizational efficiencies, the Food conformity with accounting principles generally accepted in the United States of America. Management and General: 4% Depository is able to focus 92 percent of In accordance with Government Auditing Standards, we have also issued our report dated August 18, 2006 on our consideration of Fundraising: 4% its expenses on food bank operations and programming. Resources are needed to GCFD’s internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts Food and Operations: 92% help distribute more than 40 million pounds and grants. The purpose of that report is to describe the scope of testing of internal control over financial reporting and compliance and of food annually and operate programs for the results of that testing. That report is an integral part of an audit performed in accordance with Government Auditing Standards and children, seniors, member agencies and should be read in conjunction with this report in considering the results of our audits. unemployed and underemployed adults. Oak Brook, Illinois Where Food Depository food comes from A Strategic Approach August 18, 2006 Pounds Received Fiscal Year 2005-2006 The Food Depository receives food from numerous sources, including food drives, large Donated: 59% corporate donations and commodities provided through government hunger-relief programs, Food Drives: 2% such as the USDA and FEMA. To ensure a Purchased: 5% steady inventory of staple products throughout the year – such as pasta, peanut butter, dairy Government Hunger Relief Programs: 34% and meat – the Food Depository also partners with food manufacturers to purchase those items at strategic, low prices. Where Food Depository funding comes from A Shared Commitment Public Support and Revenue By working together, the Chicago community has created a tremendous safety net in the Corporations and Foundations: 20% fight against hunger. Among those partners Other Income: 4% are the Food Depository’s member agencies, which contribute a shared maintenance fee Government Funding and Grants: 23% for products provided by the Food Depository. Those shared maintenance fees — seven Agency Shared Maintenance Fees: 8% cents per pound on most products — represent Special Events: 10% a shared commitment by the community hunger-relief organizations. While the Food Individual Donors: 35% Depository helps agencies raise necessary funding through grants programs and special events, the shared maintenance fees also encourage system-wide best practices in financial control and inventory management. STATEMENTS OF FINANCIAL POSITION June 30, 2006 and 2005 STATEMENTS OF CASH FLOWS Years ended June 30, 2006 and 2005 2006 2005 2006 2005 ASSETS CASH FLOWS FROM OPERATING ACTIVITIES Current Assets Change in net assets $÷÷««3,335,762 $÷÷««4,217,485 Adjustments to reconcile change in net assets to net cash Cash and cash equivalents $÷÷««6,945,303 $÷÷««««««935,070 provided by operating activities: Accounts receivable 254,998 250,880 Depreciation 1,344,094 1,243,208 Pledges receivable: Loss on disposal of land, building, and equipment 78,333 — Capital campaign 1,353,174 1,360,066 Decrease (increase) in inventory - contributed food 2,307,852 (720,918) Other pledges receivable 374,400 656,144 Investment income reinvested, net (360,788) (322,290) Inventory: Capital campaign contributions collected (4,691,067) (3,582,487) Contributed food 3,162,170 5,470,022 Effects of changes in operating assets and liabilities: Purchased food programs 1,588,060 1,106,553 Accounts receivable (4,118) 36,312 Other current assets 74,509 89,458 Capital campaign pledges receivable 441,989 625,734 Total current assets 13,752,614 9,868,193 Other pledges receivable 281,744 (304,609) Inventory - purchased food programs (481,507) (204,178) Other current assets 14,949 (7,906) NON-CURRENT ASSETS Accounts payable (459,147) 404,071 Accrued expenses 5,987 (253,550) Investments 13,224,532 12,863,743 Deferred revenue and other 736,586 (36,716) Capital campaign pledges receivable 1,327,842 1,762,939 Net cash provided by operating activities 2,550,669 1,094,156 Land, building, and equipment, net of accumulated depreciation 26,615,218 27,556,143 Total non-current assets 41,167,592 42,182,825 CASH FLOWS FROM INVESTING ACTIVITIES TOTAL ASSETS $÷÷54,920,206 $÷÷«52,051,018 Proceeds from disposal of land, building, and equipment 18,055 — Investments - transfer of cash and cash equivalents to Founders’ Fund Endowment — (195,210) LIABILITIES AND NET ASSETS Interest paid and capitalized on line of credit — (106,154) Purchases of land, building, and equipment (499,558) (1,579,341) Liabilities Net cash used in investing activities (481,503) (1,880,705) Accounts payable $÷÷«««««494,206 $÷÷««««««953,353 Accrued expenses 460,105 454,118 CASH FLOWS FROM FINANCING ACTIVITIES Deferred revenue 2,515,851 1,779,265 Line of credit — 750,000 Net repayments under line of credit (750,000) (3,550,000) Total liabilities 3,470,162 3,936,736 Capital campaign contributions collected 4,691,067 3,582,487 Net cash provided by financing activities 3,941,067 32,487 NET ASSETS NET INCREASE (DECREASE) IN CASH Unrestricted: AND CASH EQUIVALENTS 6,010,233 (754,062) Operating 31,849,802 26,001,368 Founders’ Fund Endowment 13,224,532 12,863,743 CASH AND CASH EQUIVALENTS, Total food bank 45,074,334 38,865,111 BEGINNING OF YEAR 935,070 1,689,132 Contributed food 3,162,170 5,470,022 Total unrestricted 48,236,504 44,335,133 CASH AND CASH EQUIVALENTS, END OF YEAR $÷÷««6,945,303 $÷÷«««««935,070 Temporarily restricted 3,213,540 3,779,149 Total net assets 51,450,044 48,114,282 These financial statements should be read only in connection with the accompanying summary of significant accounting policies and notes to financial statements. TOTAL LIABILITIES AND NET ASSETS $÷÷54,920,206 $÷÷«52,051,018 These financial statements should be read only in connection with the accompanying summary of significant accounting policies and notes to financial statements. 18 19 STATEMENTS OF ACTIVITIES Year ended June 30, 2006 STATEMENTS OF ACTIVITIES Year ended June 30, 2005 Unrestricted Unrestricted Contributed Temporarily Contributed Temporarily Food Bank Food Total Restricted Total Food Bank Food Total Restricted Total PUBLIC SUPPORT AND REVENUE PUBLIC SUPPORT AND REVENUE Public support Public support Contributions and grants $÷÷«9,173,584 $«««««««««««««««««— $÷÷«««9,173,584 $÷÷«1,529,723 $÷÷«10,703,307 Contributions and grants $÷÷««7,559,227 $÷««««««««««««««««— $÷÷««««7,559,227 $÷÷1,483,971 $÷÷««9,043,198 Contributed food received — 35,224,790 35,224,790 — 35,224,790 Contributed food received «— 37,352,338 37,352,338 «— 37,352,338 Net assets released from other restrictions: Net assets released from other restrictions: Payments made on agencies’ accounts 331,175 — 331,175 (331,175) — Payments made on agencies’ accounts 202,452 –– 202,452 (202,452) — Satisfaction of program restrictions 1,322,169 — 1,322,169 (1,322,169) — Satisfaction of program restrictions 1,127,995 — 1,127,995 (1,127,995) — Revenue Revenue Fees and grants from government agencies 3,788,876 — 3,788,876 — 3,788,876 Fees and grants from government agencies 3,217,571 — 3,217,571 — 3,217,571