Financial Statements Edmonton City Centre Church Corporation
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Financial Statements Edmonton City Centre Church Corporation December 31, 2019 Contents Page Independent Auditor’s Report 1 - 2 Statement of Financial Position 3 Statement of Operations 4 Statement of Changes in Net Assets 5 Statement of Cash Flows 6 Notes to the Financial Statements 7 – 23 Grant Thornton LLP 1701 Scotia Place 2 10060 Jasper Avenue NW Edmonton, AB T5J 3R8 T +1 780 422 7114 Independent Auditor’s Report F +1 780 426 3208 To the Members of the Edmonton City Centre Church Corporation Opinion We have audited the financial statements of Edmonton City Centre Church Corporation (“the Organization”), which comprise the statement of financial position as at December 31, 2019, and the statements of operations, changes in net assets and cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of Edmonton City Centre Church Corporation as at December 31, 2019, and its results of its operations and its cash flows for the year then ended in accordance with Canadian accounting standards for not-for-profit organizations. Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Organization in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of Management and Those Charged with Governance 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. In preparing the financial statements, management is responsible for assessing the Organization’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Organization or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Organization’s financial reporting process. 1 grantthornton.ca Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. • Obtain an understanding of internal control relevant to the audit 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 Organization’s internal control. • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. • Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Organization’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Organization to cease to continue as a going concern. • Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Edmonton, Canada August 27, 2020 Chartered Professional Accountants Audit | Tax | Advisory © Grant Thornton LLP. A Canadian Member of Grant Thornton International Ltd 2 Edmonton City Centre Church Corporation Statement of Financial Position December 31 2019 2018 Assets Current Cash $ 3,574,714 $ 2,688,768 Restricted cash (Note 7) 1,080,270 686,088 Short-term investments 142,237 141,055 Accounts receivable (Note 3) 1,556,484 1,348,315 Prepaid expenses and deposits 7,995 - 6,361,700 4,864,226 Long-term investments (Note 4) 1,217,279 1,072,162 Inner City Youth Housing Project (Note 5) 136,445 133,597 Capital assets (Note 6) 9,992,840 10,056,814 $ 17,708,264 $ 16,126,799 Liabilities Current Accounts payable and accrued liabilities $ 1,402,193 $ 1,425,595 Funds held for others (Note 7) 1,080,270 686,088 Deferred contributions (Note 8) 1,543,271 2,360,492 Current portion of long-term debt (Note 9) 227,240 196,788 Current portion of deferred conditional grants (Note 10) 16,000 16,000 4,268,974 4,684,963 Long-term debt (Note 9) 1,784,496 2,012,081 Deferred conditional grants (Note 10) 8,000 24,000 6,061,470 6,721,044 Net assets Unrestricted 888,164 516,120 Restricted (Note 16) 2,258,107 1,127,510 Investment in capital assets 8,500,523 7,762,125 11,646,794 9,405,755 $ 17,708,264 $ 16,126,799 Commitments and guarantees (Note 12) Contingencies (Note 19) Subsequent events (Note 24) On behalf of the Board: Director Director See accompanying notes to the financial statements 3 Edmonton City Centre Church Corporation Statement of Operations Year Ended December 31 Capital Unrestricted Restricted Assets 2019 2018 Revenues Contract income (Note 13) $ - $20,831,847 $ - $20,831,847 $ 17,926,502 Donations and grants (Note 18) 184,936 2,335,084 293,489 2,813,509 2,373,849 Rents and client fees 43,865 896,790 - 940,655 924,655 Cafe operations - 264,870 - 264,870 190,484 Management fees (Note 5) 160,307 - - 160,307 155,972 Interest 59,246 47,494 - 106,740 69,591 Other 5,844 12,303 - 18,147 36,226 454,198 24,388,388 293,489 25,136,075 21,677,279 Expenditures Wages and benefits 2,459,466 12,997,523 - 15,456,989 13,967,918 Direct client costs - 3,713,869 - 3,713,869 3,473,071 Facility, office and other 874,349 1,936,149 - 2,810,498 2,851,879 Amortization of capital assets - - 553,323 553,323 525,079 Professional fees 66,879 120,066 - 186,945 115,997 Cafe cost of sales - 123,547 - 123,547 117,761 Mortgage interest - 30,170 - 30,170 33,625 Administration fees and recovery (Note 15) (3,354,042) 3,354,042 - - - 46,652 22,275,366 553,323 22,875,341 21,085,330 Excess (deficiency) of revenues over expenditures before other items 407,546 2,113,022 (259,834) 2,260,734 591,949 Other items Gain on disposal of capital Assets (Note 6) - - 85,791 85,791 - Inner City Youth Housing Project (Note 5) - 2,848 - 2,848 (11,934) Excess (deficiency) of revenues over expenditures $ 407,546 $ 2,115,870 $ (174,043) $ 2,349,373 $ 580,015 See accompanying notes to the financial statements 4 Edmonton City Centre Church Corporation Statement of Changes in Net Assets Year Ended December 31 Capital 2019 2018 Unrestricted Restricted Assets Total Total (Note 16) (Note 17) Net assets, beginning of year $ 516,120 $ 1,127,510 $ 7,762,125 $ 9,405,755 $ 8,825,740 Excess (deficiency) of revenues over expenditures 407,546 2,115,870 (174,043) 2,349,373 580,015 Internally imposed restrictions (Note 17) (25,000) 25,000 - - - Externally restricted fund paid out (Note 16) - (108,334) - (108,334) - Interfund transfers (Note 17) (10,502) (901,939) 912,441 - - Net assets, end of year $ 888,164 $ 2,258,107 $ 8,500,523 $ 11,646,794 $ 9,405,755 See accompanying notes to the