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Ganna Walska Lotusland Financial Statements December 31, 2018

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Ganna Walska Lotusland Financial Statements December 31, 2018 GANNA WALSKA LOTUSLAND FINANCIAL STATEMENTS DECEMBER 31, 2018 GANNA WALSKA LOTUSLAND December 31, 2018 TABLE OF CONTENTS Page Independent Auditor's Report 1 – 2 Financial Statements: Statement of Financial Position 3 Statement of Activities and Changes in Net Assets 4 Statement of Functional Expenses 5 Statement of Cash Flows 6 Notes to Financial Statements 7 - 19 CERTIFIED PUBLIC ACCOUNTANTS AND CONSULTANTS 111 E. Victoria Street, 2nd Floor, Santa Barbara, CA 93101, (805) 962-9175, www.mcgowan.com INDEPENDENT AUDITOR'S REPORT Audit Committee of the Board of Trustees Ganna Walska Lotusland Santa Barbara, California We have audited the accompanying financial statements of Ganna Walska Lotusland (a non- profit organization), which comprise the statement of financial position as of December 31, 2018, and the related statements of activities and changes in net assets, functional expenses, and cash flows for the year 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. - 1 - Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Ganna Walska Lotusland as of December 31, 2018, and the change in its net assets and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America. Report on Summarized Comparative Information We have previously audited the Ganna Walska Lotusland 2017 financial statements, and we expressed an unmodified audit opinion on those statements in our report dated August 22, 2018. In our opinion, the summarized comparative information presented herein as of and for the year ended December 31, 2017 is consistent, in all material respects, with the audited financial statements from which it has been derived. Santa Barbara, California September 12, 2019 - 2 - GANNA WALSKA LOTUSLAND STATEMENT OF FINANCIAL POSITION December 31, 2018 (With Comparative Totals for December 31, 2017) ASSETS (Memo) Without Donor With Donor 2018 2017 Restrictions Restrictions Total Total CURRENT ASSETS Cash and cash equivalents$ 1,309,800 $ - $ 1,309,800 $ 2,695,290 Inventories 37,032 - 37,032 37,157 Pledges receivable, current portion - 237,367 237,367 490,250 Other receivables 130,634 - 130,634 2,500 Prepaid expenses and deposits 39,053 - 39,053 36,734 Total Current Assets 1,516,519 237,367 1,753,886 3,261,931 NON-CURRENT ASSETS Pledges receivable, net of current portion - 213,236 213,236 465,416 Investments 7,696,742 4,844,147 12,540,889 13,685,081 Property and equipment, net 5,372,820 3,610,315 8,983,135 6,560,493 Total Non-Current Assets 13,069,562 8,667,698 21,737,260 20,710,990 TOTAL ASSETS$ 14,586,081 $ 8,905,065 $ 23,491,146 $ 23,972,921 LIABILITIES AND NET ASSETS CURRENT LIABILITIES Accounts payable $ 238,487 $ - $ 238,487 $ 141,700 Accrued liabilities 521,989 - 521,989 213,900 Total Current Liabilities 760,476 - 760,476 355,600 NET ASSETS Without Donor Restrictions Board designated for endowment 471,503 - 471,503 594,319 Board designated for capital 107,346 - 107,346 68,947 Other net assets without donor restrictions 13,246,756 - 13,246,756 14,558,545 Total Without Donor Restrictions 13,825,605 - 13,825,605 15,221,811 With Donor Restrictions - 8,905,065 8,905,065 8,395,510 Total Net Assets 13,825,605 8,905,065 22,730,670 23,617,321 TOTAL LIABILITIES AND NET ASSETS$ 14,586,081 $ 8,905,065 $ 23,491,146 $ 23,972,921 The accompanying notes are an integral part of these financial statements. - 3 - GANNA WALSKA LOTUSLAND STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS For the Year Ended December 31, 2018 (With Comparative Totals for the Year Ended December 31, 2017) (Memo) Without Donor With Donor 2018 2017 Restrictions Restrictions Total Total REVENUE, GAINS AND OTHER SUPPORT Contributions and grants $ 250,629 $ 897,427 $ 1,148,056 $ 2,463,492 Membership contributions 626,295 - 626,295 573,117 Admission fees 417,537 - 417,537 458,308 Garden shop 122,835 - 122,835 143,076 Investment income (loss), net of fees of $102,711 and $104,942 (338,139) (145,076) (483,215) 1,303,085 Public programs 76,677 - 76,677 75,465 Other 190,675 - 190,675 68,001 Special events (net of expenses of $405,408 and $549,266) 616,842 - 616,842 481,474 Net assets released from restrictions 242,796 (242,796) - - Total Revenue, Gains and Other Support 2,206,147 509,555 2,715,702 5,566,018 EXPENSES Garden operations and plant collections 2,294,796 - 2,294,796 2,168,816 Management and general 653,265 - 653,265 575,124 Fundraising 654,292 - 654,292 636,813 Total Expenses 3,602,353 - 3,602,353 3,380,753 CHANGE IN NET ASSETS (1,396,206) 509,555 (886,651) 2,185,265 NET ASSETS, BEGINNING OF YEAR 15,221,811 8,395,510 23,617,321 21,432,056 NET ASSETS, END OF YEAR $ 13,825,605 $ 8,905,065 $ 22,730,670 $ 23,617,321 The accompanying notes are an integral part of these financial statements. - 4 - GANNA WALSKA LOTUSLAND STATEMENT OF FUNCTIONAL EXPENSES For the Year Ended December 31, 2018 (With Comparative Totals for the Year Ended December 31, 2017) Program Services Support Services Garden Operations Management (Memo) and Plant and 2018 2017 EXPENSES Collections General Fundraising Total Total Salaries and wages$ 1,181,750 $ 312,471 $ 423,258 $ 1,917,479 $ 1,787,323 Payroll taxes and benefits 287,613 144,890 69,180 501,683 485,815 Total salaries and benefits 1,469,363 457,361 492,438 2,419,162 2,273,138 Professional services 233 55,773 1,338 57,344 60,352 General administrative expenses 178,225 86,990 75,021 340,236 318,403 Facilities 206,506 11,408 1,263 219,177 208,710 Insurance 23,792 8,862 11,293 43,947 23,406 Agricultural materials and supplies 56,913 638 170 57,721 60,944 Public programs and education 28,566 81 25 28,672 21,702 Public relations, advertising and promotion 68,443 11,751 42,143 122,337 88,832 Garden shop 58,746 - - 58,746 73,139 Depreciation 204,009 20,401 30,601 255,011 252,127 2018 TOTAL EXPENSES$ 2,294,796 $ 653,265 $ 654,292 $ 3,602,353 2017 TOTAL EXPENSES (MEMO)$ 2,168,816 $ 575,124 $ 636,813 $ 3,380,753 The accompanying notes are an integral part of these financial statements. - 5 - GANNA WALSKA LOTUSLAND STATEMENT OF CASH FLOWS For the Year Ended December 31, 2018 (With Comparative Totals for the Year Ended December 31, 2017) (Memo) 2018 2017 CASH FLOWS FROM OPERATING ACTIVITIES Change in net assets$ (886,651) $ 2,185,265 Adjustments to reconcile change in net assets to net cash provided by operating activities: Depreciation 255,011 252,127 Unrealized loss (gain) on value of securities 943,652 (982,907) Realized gain on sale of securities (16,023) (96,349) Contributions restricted for endowment (30,156) (701,001) (Increase) decrease in: Inventories 125 14,023 Pledges receivable 505,063 (533,979) Other assets (128,134) (880) Prepaid expenses and deposits (2,319) 2,721 Increase (decrease) in: Accounts payable 96,787 40,981 Accrued liabilities 308,089 53,220 NET CASH PROVIDED BY OPERATING ACTIVITIES 1,045,444 233,221 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property and equipment (2,677,653) (986,879) Purchase of securities (288,229) (106,517) Proceeds from sale of securities 504,792 364,715 NET CASH USED BY INVESTING ACTIVITIES (2,461,090) (728,681) CASH FLOWS FROM FINANCING ACTIVITIES Contributions restricted for endowment 30,156 701,001 NET CASH PROVIDED BY FINANCING ACTIVITIES 30,156 701,001 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (1,385,490) 205,541 CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 2,695,290 2,489,749 CASH AND CASH EQUIVALENTS - END OF YEAR$ 1,309,800 $ 2,695,290 The accompanying notes are an integral part of these financial statements.
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