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WICHITA FALLS FAITH MISSION, INC.
FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR'S REPORT
FOR THE YEAR ENDED JUNE 30, 2013
MWH
CERTIFIED PUBLIC ACCOUNTANTS
CONSULTANTS
WICHITA FALLS FAITH MISSION, INC.
FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR'S REPORT
JUNE 30, 2013
CONTENTS
Independent Auditor's Report
1 -2
Financial Statements:
Statement of Financial Position
3
Statement of Activities
4
Statement of Functional Expenses
5
Statement of Cash Flows
6
Notes to Financial Statements
7-12
Supplemental Schedules:
Schedule of Activities by Cost Center
13
Schedule of Functional Expenses by Cost Center
14
MWH GROUP
CERTIFIED PUBLIC ACCOUNTANTS
CONSULTANTS
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors
Wichita Falls Faith Mission, Inc.
We have audited the accompanying financial statements of Wichita Falls Faith Mission, Inc. (the
Organization), a nonprofit corporation, which comprise the statement of financial position 35 of June 3D,
2013, and the related statements of activities, 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.
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the
financial position of Wichita Falls Faith Mission, Inc. as of June 30, 2013, and the changes 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.
1
MWHGROURRC.
mvwnwhpc.com
624 Indiana
RO.Box97000
Wichita FallsJX 76307
(940) 723-1 -471
Fax (940)723-2251
Other Matter
Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole.
The supplemental schedules listed in the table of contents are presented for purposes of additional
analysis and is not a required part of the financial statements. Such information is the responsitmity of
management and was^erived from and relates directly to the underlying accounting and other records
used to prepare the financial statements. The information has been subjected to the auditing procedures
applied in the audit of the financial statements and certain additional procedures, including comparing and
reconciling such information directly to the underlying accounting and other records used to prepare the
financial statements or to the financial statements themselves, and other additional procedures in
accordance with auditing standards generally accepted in the United States of America. In our opinion, the
information is fairly Stated in all material respects in relation to the financial statements as a whole.
MWH GROUP, P.C.
Wichita Falls, Texas
October 4, 2013
WICHITA FALLS FAITH MISSION, INC.
STATEMENT OF FINANCIAL POSITION
JUNE 30, 2013
Current assets: Cash
Inventory Land held for sale
Prepaid expenses and other
Total current assets
767,375
22,230
72,397
8,497
Property and equipment, net Total
871,100
assets
4.484,555
$ 5,355,655
LIABILITIES AND NET ASSETS
Current liabilities: Accounts payable
Deferred compensation agreement
Other accrued liabilities Total current
liabilities
Noncurrent liabilities: Deferred compensation agreement,
less current portion
8,707
15,475
17,650
41,832
Total liabilities
86,686
Net assets: Unrestricted
Temporarily restricted
Total net assets
128,518
4,922,559
304,578
5,227,137
Total liabilities and net assets
$ 5,355,655
The accompanying notes are an integral part of these financial statements.
3
WICHITA FALLS FAITH MISSION, INC.
STATEMENT OF ACTIVITIES FOR
THE YEAR ENDED JUNE 30, 2013
Revenue and support:
Temporarily
Unrestricted
Contributions
Special events
Interest income
Oil and gas royalties
Sale of surplus donated clothing
Miscellaneous revenue
Sales
Cost of sales
Gain on disposal of assets
Net assets released from restrictions
Total revenue and support
Expenses: Program
services
Administrative
Fundraising
Total expenses Changes in net
assets Net assets at beginning of year, as
reported Prior period adjustment Net assets
at beginning of year, as restated Net assets
$
Restricted
1,029,997
75,420
$
210,305
979
_
.
-
600
(219,665)
(9,360)
1,228,001
156,574
99,610
1,484,185
.
(81,327)
373
(9,360)
1,108,276
59,259
5,618
150,499
(141.1061
600
-
1,393,498
1,228,001
156,574
99,610
1,484,185
(90,687)
5,311,283
800,879
(794,338)
6,541
5,003,886
313,938
5,31.7,824
$
4,922,559
$
304,578
The accompanying notes are an integral part of these financial statements.
4
1,240,302
75,420
1,927
219,665
1,402,858
at end of year
$
-
1,927
59,259
5,618
150,499
(141,106)
4,203,007
Total
$
5,227,137
WICHITA FALLS FAITH MISSION, INC.
STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED JUNE 30, 2013
Program Services
Automobile
$
Christmas gift
Contract labor
Depreciation
Employee benefits
Food
Insurance
Kitchen supplies
Membership dues and fees
Office and miscellaneous
Payroll taxes
Postage and printing
Professional fees
Program gift
Promotional
Repair and Maintenance
Salaries
Specific assistance
Special projects
Training and travel
Utilities
Totals
30,729
•
Administrative
$
5,728
7,270
197,335
67,449
14,288
45,893
8,514
3,800
39,800
51,878
3,065
24,939
39,847
541,784
23,542
13,017
18,352
90,771
„
-
6,255
180
231,510
1,830
_
7E.63S
14,288
1,508
53,656
8,814
3,980
41,977
62,182
3,065
3,707
43,184
634
42,311
1,879
$
99,610
1,484,185
The accompanying notes are an integral part of these financial statements.
5
5,728
7,270
4,557
_
-
2,177
6,597
12,725
4,125
76,324
12,213
156,574
'
30,729
*
29,618
6,360
_
1,228,001
$
Total
Fund raising
$
12,725
24,939
43,184
44,606
660,419
23,542
13,017
18,352
104,863
$
WICHITA FALLS FAITH MISSION, INC.
STATEMENT OF CASH FLOWS FOR
THE YEAR ENDED JUNE 30,2013
Cash flows from operating activities: Changes in net
assets Adjustments to reconcile changes in net
assets to
net cash provided by operating activities:
Depreciation (Increase) decrease in assets:
Receivables
Prepaid expenses Increase
(decrease) in liabilities:
Accounts payable
Deferred compensation agreement
Other accrued liabilities Net cash provided by
operating activities
(90,687)
1,274
(5,774)
(42,830)
(16,471)
17,650
94,672
Cash flows from investing activities:
Purchase of property and equipment
Sale of investments
(221,518)
405
(221,113)
Net cash used by investing activities
Net decrease in cash and cash equivalents Cash
(126,441)
and cash equivalents at beginning of year Cash
894,417
and cash equivalents at end of year
767,976
Schedule of noncash investing and financing activities: Assets
transferred from property and equipment to land held for sale
The accompanying notes are an integral part of these financial statements.
6
72,397
WICHITA FALLS FAITH MISSION, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2013
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Activities
The Wichita Falls Faith Mission, Inc. (the Mission) is an independent nonprofit corporation
whose operating facility and administrative offices are located at 1300 Travis Street, Wichita
Falls, Texas. The Mission provides food, clothing, lodging, and snares the "Good News OT the
Gospel of Jesus Christ" with needy, transient, and indigent individuals and families in the
Wichita Falls area. The Mission receives private donations of money, food, clothing, household
items, etc. from the general public.
Basis of Accounting
The accompanying financial statements are presented in accordance with the accounting and
reporting standards required by FASB ASC 958, A/of for Profit Entities. FASB ASC 958 requires
the Mission to report information regarding its financial position and activities according to three
classes of net assets:
Unrestricted Net Assets - Result from revenues from providing services, producing
goods, unrestricted contributions and dividends and interest from income -producing
assets less applicable related expenses. The Mission treats restricted contributions
whose restrictions are satisfied during the same fiscal year as unrestricted support. All
contributions made to the Mission are considered to be available for unrestricted use
unless specifically restricted by the donor.
Temporarily Restricted Net Assets - Represent net assets subject to donor-imposed
stipulations that can be fulfilled by actions of the Mission pursuant to those stipulations or
that expire by the passage of time.
Permanently Restricted Net Assets - Result from donor-imposed stipulations that neither
expire by the passage of time or can be fulfilled or otherwise removed by actions of the
Mission. The Mission had no permanently restricted net assets at year end.
Cash and Cash Equivalents
For financial reporting purposes, the Mission considers all highly liquid debt instruments
purchased with original maturities of three months or less to be cash equivalents.
Inventory consists of donated apparel and other items and is recorded as contributions and as
inventory in the period received at fair market value.
Property and Equipment
Acquisitions of property and equipment in excess of $1,000 are capitalized. Property and
equipment are carried at cost or, if donated, at the approximate fair value at the date of
donation. Depreciation is provided utilizing the straight-line method over the estimated useful
lives of the respective assets, as follows:
WICHITA FALLS FAITH MISSION, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D.)
JUNE 30, 2013
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D,)
Property and Equipment (Cont'd.l
Buildings and Improvements
Vehicles, furniture, and fixtures
30 years
3 to 10 years
Donated Land, Equipment, Materials, and Services
Contributions of services and materials are recognized in the accompanying financial
statements in accordance with FASB ASC 958-605. Accounting for contributions Receivea and
Contributions Made, if the services are received enhance or create non-financial assets, require
specialized skills, are provided by individuals possessing those skills, ana would typically need
to be purchased if not provided by the donation.
Income Taxes
The Mission is qualified as a tax-exempt organization under section 501(c)(3) of the Internal
Revenue Code of 1986 and therefore, has no provision for federal income tax.
Functional Classification of Expenses
Directly identifiable expenses are charged to program services, administrative, and fundraising
functions. Expenses related to more than one function are charged to each function on the
basis of periodic time and expense studies. Administrative expenses include those expenses
that are not directly identifiable with any other specific function but provide for the overall
support and direction of the Mission. A description of the Mission's functions is provided below.
•
Program Services
The Mission provides food clothing, lodging, financial assistance, addiction counseling,
and shares the "Good News of the Gospel of Jesus Christ" with needy, transient, and
indigent individuals and families in the Wichita Falls area. Management believes that
approximately 85% of pertinent non-direct expenses are related to this function.
•
Administrative
The Administration program provides occupancy and administrative services to the
Mission. Management believes that approximately 13% of pertinent non-direct expenses
are related to this function.
•
Fundraising
The Mission engages in a number of fundraising activities, including rallies with praise
and worship, food drives, mail solicitations, Cruisin' for Charity, Night in a Box, Mother
Theresa Project, Home and Garden Show, Decorator Show House, and the Small
Change Project. Contributions to the Mission are received from the general public.
Management believes that approximately 2% of pertinent non-direct expenses are related
to this function.
WICHITA FALLS FAITH MISSION, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D.)
JUNE 30, 2013
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D.)
Restricted and Unrestricted Revenue
Contributions received are recorded as increases in unrestricted, temporarily restricted, or
permanently restricted net assets, depending on the existence and/or nature of any
donor-restrictions. Contributions that are restricted by the donor are reported as increases
in unrestricted net assets if the restrictions expire in the reporting period in which the revenue is
recognized. All other donor-restricted contributions are reported as increases in temporarily or
permanently restricted net assets, depending on the nature of the restrictions. When a
restriction expires, temporarily restricted net assets are reclassified to unrestricted net assets
and reported in the Statement of Activities as net assets released from restrictions.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally
accepted in the United States of America requires management to make estimates and
assumptions that affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates.
Accrued Compensated Absences
Sick and vacation leave are not accumulated or paid upon departure. As a result, no liability has
been recorded in these financial statements for accrued compensated absences.
The Mission uses advertising to solicit donations and promote special events. The costs of
advertising are expensed as incurred. During the year ended June 30 2013, advertising costs
totaled $43,184.
Date of Management's Evaluation
Management has evaluated subsequent events though October 4, 2013 the date on which the
financial statements were available to be issued.
Note 2 - CONCENTRATION OF CREDIT RISK FOR CASH HELD IN BANKS
The Mission maintains bank accounts with several institutions. The accounts held at the bank are
insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. None of the cash
accounts had a balance that exceeded FDIC insured limits at June 30, 2013.
NoteS-
PROPERTY AND EQUIPMENT
Property and equipment are stated at cost less accumulated depreciation. Major classifications
of property and equipment at June 30, 2013 are summarized as follows:
WICHITA FALLS FAITH MISSION, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D.)
JUNE 30, 2013
NoteS - PROPERTY AND EQUIPMENT (CONT'D.)
Property and equipment not being depreciated:
Land Property and equipment being
depreciated:
Building and improvements
Furniture and fixtures
Vehicles
Total property and equipment being depreciated
Less accumulated depreciation Total property and
equipment being depreciated, net
Total property and equipment, net
Depreciation expense was $231,510 for the year ended June 30, 2013.
Note 4-
INVENTORY
The Mission maintained the following types of inventory as of June 30, 2013:
Note 5 -
Apparel
Other items
$
21,086
Total
£
22.230
DEFERRED COMPENSATION AGREEMENT
Effective August 20, 2001, a deferred compensation plan for the Executive Director and
Marketing Director was adopted by action of the Board of Directors. The plan requires that on
the first day of the month immediately following the retirement or death of the Executive
Director, and on the first day of each month thereafter during the joint lifetimes of the Executive
Director and the Marketing Director, the Mission will pay the Executive Director and the
Marketing Director, or the survivor of them, the total sum of $2,000 per month. This Deferred
Compensation Agreement is entered into for and in consideration of the years of service given
to the Mission. Effective January 1, 2007 the Executive Director retired. Total payments under
this arrangement for fiscal year 2013 were $24,000. Future minimum payments are $24,000 per
year until the death of the retired Executive Director.
A liability has been recorded for the net present value of the Mission's obligation under this
agreement, based on the estimated remaining life of the recipient. As the remaining life of the
recipient is uncertain, it is at least reasonably possible that a change in this estimate will occur in
the near term.
10
WICHITA FALLS FAITH MISSION, INC.
NOTES TO FINANCIAL STATEMENTS (CONTD.)
JUNE 30, 2013
NoteB-
NET ASSETS
Temporarily restricted net assets are available for the following purposes:
Faith Refuge building
Faith Mission roof repair
Faith Refuge family units
Board of Directors Strategic Planning
Tattoo removal - Faith Refuge clients
Medical care - Faith Refuge clients
$
Medical care - Faith Mission clients
138,880
50,105
4,500
21,265
20,000
7,228
2.600
Total
S 304,578
Net assets were released from donor restrictions by incurring expenses satisfying the purpos
or time restrictions specified by donors as follows:
Faith Refuge building
Tattoo removal - Faith Refuge clients
Medical care - Faith Refuge clients
Strategic planning
Other
Note?-
THRIFT STORE SALES
Sales for the thrift store are $141,106, shown net of applicable
sales taxes. Note 8 -
OIL AND GAS MINERAL INTEREST
In 1987, the Mission received a donation of an overriding royalty interest in an oil and gas
mineral lease located in Webster Parish, Louisiana.
Royalties received during 2013 are included as unrestricted revenue in the accompanying
financial statements. The $8,756 original appraised value of the asset has been fully amortized
and is included in the Mission's property and equipment.
Note9-
CONCENTRATIONS
Faith Mission operates in Wichita Falls, Texas. Therefore, support and revenue is dependent
on economic conditions in that area.
Note 10- RETIREMENT PLAN
The Mission has in place a Savings Incentive Match Plan for Employees (SIMPLE). A SIMPLE
plan is a defined contribution plan where an employee may defer up to $11,500 per year in
compensation. The Mission will match up to 3% of the employee's salary. SIMPLE matching
expense for 2013 was $990.
11
WICHITA FALLS FAITH MISSION, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D.)
JUNE 30, 2013
Note 11- RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
The Wichita Falls Faith Mission, Inc.'s financial statements at July 1, 2012, the beginning of this year,
have been restated for the following reasons:
•
•
to record a liability for the deferred compensation agreement, which had not been
previously recognized;
to correct accumulated depreciation, which had not been consistently calculated under
the straight line method in accordance with the Mission's policy;
•
to record the land held-for-sale at fair market value; and
•
to correct the ending balance in temporarily restricted net assets.
The effect of this restatement is noted below.
Temporaril
y
Restricted
Unrestricted
Net assets at 7/1/2012,
as reported
Restatement adjustments: Deferred
compensation agreement
Accumulated depreciation Land
held-for-sale Restricted net assets
correction
$4,203,007
(118,632
)
198,691
(73,518)
794.338
Total restatement adjustments:
Net assets at 7/1/2012, as
restated
$
1,108,276
$5,311,283
(794.338)
(118,63
2)
198,691
(73,518)
(794.338)
£
313,938
12
Total
S 5.317.824
SUPPLEMENTAL SCHEDULES
WICHITA FALLS FAITH MISSION, INC.
SCHEDULE OF ACTIVITIES BY COST CENTER
FOR THE YEAR ENDED JUNE 30, 2013
Faith Mission Thrift Shoppe
Faith Refuge
Revenue and support:
Contributions
Special events
Interest income
Oil and gas royalties
Sale of surplus donated clothing
Miscellaneous revenue
Sales
Cost of sales
Gain disposal of assets
Net assets released from restrictions
Total revenue and support
Expenses: Program
services
Administrative
Fundraising
$
619,774
20,343
463
1,927
59,259
(377)
667
600
1,160
703,816
484,943
73,484
49,066
607,493
$
143,196
_
3
5,995
141,106
(141,106)
149,194
180,863
_
180,863
$
267,027
55,077
513
8,726
218,505
549,848
562,195
83,090
50,544
695,829
Total
Mission
$1,029,997
75,205
75,420
979
1,927
59,259
5,618
150,499
(141,106)
600
219,665
(1,160)
1,402,858
74,045
Faith
$
Temporarily Restricted
Faith Refuge
Total
$
(218,505)
(83,405)
Total
135,100
$
(219,665)
(9.360)
1,228,001
156,574
99,510
1,484,185
210,305
$1,240,302
75,420
979
1.927
59,259
5.618
150.499
(141.106)
600
1
,393.498
1,228.001
156.574
99.610
1 ,484.1 85
Total expenses
Changes in net assets
$ $
96,323 (31,669)
$
(145,981^
$
74,045
(81,327)
$
The accompanying notes are an integral part of these financial statements. 13
$
(83,405)
$
(9,360)
$
(90.667)
WICHITA FALLS FAITH MISSION, INC.
SCHEDULE OF FUNCTIONAL EXPENSES BY COST CENTER
FOR THE YEAR ENDED JUNE 30, 2013
Automobile
Christmas gift
Contract labor
Depreciation
Employee benefits
Food
Insurance
Kitchen supplies
Membership dues and fees
Office and miscellaneous
Payroll taxes
Postage and printing
Professional fees
Program gift
Promotional
Repair and Maintenance
Salaries
Specific assistance
Special projects
Training and travel
Utilities
Totals
Faith Mission
$
18,459
$
4,010
7,270
54,866
14,140
8,707
21,605
4,739
3,427
28,256
21,405
2,488
Program Services
Thrill Shoppe
Faith Refuge
7,404
$
4,866
$
_
1,718
3,676
15,558
5,156
_
373
3,854
10,788
Administrative
30,729
7,690
19,685
577
Fundraising
29,618
6,360
4,557
1,830
-
-
6,255
1,508
180
-
2,177
6,597
_
3.707
-
12,725
12,587
12,352
Total
$
$
5,728
7,270
197,335
67,449
14,288
45,893
8,514
3,800
39,800
51,878
3,065
138,793
37,751
5,581
19,132
3,775
_
Total
-
24,939
>'
43,184
$
$
15,135
191,533
15,023
7,094
6,596
47,603
484,943
12,879
100,426
_
10,211
10,911
180,863
$
11,833
249,825
8,519
5,923
1,545
32,257
562,195
$
39,847
541,784
23,542
13,017
18,352
90,771
1,228,001
4,125
76,324
$
12,213
156,574
$
The accompanying notes are an integral part of these financial statements. 14
634
42,31 1
1,879
99,61 0
$
$
30,729
5,728
7,270
231,510
75,639
14,288
53,656
8,514
3,980
41,977
62,182
3,065
12,725
24,939
43,184
44,606
660.419
23,542
13,017
18,352
104,863
1,484,185