JUMA VENTURES FINANCIAL STATEMENTS Year Ended December 31, 2011
TABLE OF CONTENTS Page
Independent Auditors' Report ........................................................................................................1 Financial Statements: Statement of Financial Position .........................................................................................2 Statement of Activities .......................................................................................................3 Statement of Functional Expenses .....................................................................................4 Statement of Cash Flows ...................................................................................................5 Notes to the Financial Statements ......................................................................................6
JUMA VENTURES STATEMENT OF FINANCIAL POSITION December 31, 2011 and 2010 2011
2010
Assets Current assets Cash and cash equivalents Grants and contributions receivable Accounts receivable Investments Notes receivable Inventory Prepaid expenses Total current assets
$ 2,364,128 360,097 35,145 505,808 23,433 24,904 3,313,515
$ 2,314,854 427,877 18,787 306,963 38,959 14,638 30,868 3,152,946
Other assets Deposits Property and equipment, net Total other assets Total Assets
24,226 91,086 115,312 $ 3,428,827
20,394 122,102 142,496 $ 3,295,442
$
$
Liabilities and Net Assets Current liabilities: Accounts payable Accrued liabilities Total current liabilities Net assets Unrestricted net assets Temporarily restricted Total net assets Total Liabilities and Net Assets
296,362 200,206 496,568
874,935 2,057,324 2,932,259 $ 3,428,827
See accompanying notes to financial statements. 2
287,862 204,862 492,724
811,351 1,991,367 2,802,718 $ 3,295,442
JUMA VENTURES STATEMENT OF ACTIVITIES Year Ended December 31, 2011 (with comparative totals for 2010) 2011 Unrestricted Revenues, gains, and other support Grants and contributions Employment projects Investment income (includes interest from certificates of deposit) Special event income, net of expenses of $57,327 Miscellaneous income Net assets released from restrictions: Satisfaction of program restrictions
$
8,530 73,979 43,030 2,031,695
Total revenues, gains, and other support Expenses: Program services: Support services: Management and general Fundraising Total expenses Change in net assets Net assets, beginning of year Net assets, end of year
688,459 1,683,229
$
Temporarily Restricted
$ 2,097,652 -
Total
$
(2,031,695)
2010 Total
2,786,111 1,683,229
$ 2,340,102 1,541,639
8,530 73,979 43,030
10,061 63,495 32,120
-
-
4,528,922
65,957
4,594,879
$ 3,987,417
3,898,366
-
3,898,366
3,475,858
248,431 318,541
-
248,431 318,541
287,608 220,875
4,465,338
-
4,465,338
3,984,341
63,584
65,957
129,541
3,076
811,351
1,991,367
2,802,718
2,799,642
874,935
$ 2,057,324
2,932,259
$ 2,802,718
See accompanying notes to financial statements. 3
$
JUMA VENTURES STATEMENT OF FUNCTIONAL EXPENSES Year Ended December 31, 2011 (with comparative totals for 2010) 2011 Program Services Business Employment Employee compensation Salaries Payroll taxes and benefits Total personnel Other expenses Cost of goods sold & concession fees Rent Utilities Union fee Repairs & maintenance Telephone, internet, email Insurance and property taxes Postage, printing, and supplies Travel and transportation Consultants & professional services Equipment Project costs Training stipend costs Training supplies and costs Financial assistance Refund to Earn Marketing/public relations Interest and bank charges/losses Depreciation & amortization Business fees/permits Recruiting/conferences/retention/evaluation Loss on disposal of assets Total expenses
$
$
Workforce Resources
698,190
966,775 176,892 1,143,667
891,029 15,481 331 16,616 13,422 7,117 11,914 7,972 5,616 26,190 8,381 12,672 2,423 336 345 20,876 5,411 2,487 1,746,809
146,298 2,275 5,438 9,653 5,591 13,593 26,231 86,643 3,707 270,037 21,133 11,134 150,000 134,842 605 322 18,873 2,050,042
586,472 111,718
$
$
Supporting Services
Replication $
$
46,514 8,552 55,066
1,211 45,238 101,515
Total $
$
1,599,761 297,162 1,896,923
891,029 161,779 2,606 16,616 18,860 16,770 17,505 21,565 33,058 158,071 12,088 282,709 21,133 13,557 150,000 134,842 941 667 20,876 5,411 21,360 3,898,366
Management and General
Fund-raising
$
$
$
See accompanying notes to financial statements. 4
116,397 21,385 137,782
23,221 496 237 6,797 4,646 6,049 7,697 29,543 972 172 21,997 8,822 248,431
$
Total
2011 Total
2010 Total
201,802 37,105 238,907
$
318,199 58,490 376,689
$ 1,917,960 355,652 2,273,612
$ 1,723,958 313,095 2,037,053
15,481 331 119 3,423 2,393 3,031 584 8,085 35,315 6,777 79 4,016 318,541
38,702 827 356 10,220 7,039 9,080 8,281 37,628 972 35,315 6,777 251 21,997 12,838 $ 566,972
891,029 200,481 3,433 16,616 19,216 26,990 24,544 30,645 41,339 195,699 13,060 318,024 21,133 13,557 150,000 134,842 7,718 918 42,873 5,411 34,198 $ 4,465,338
847,393 177,181 1,424 19,289 19,775 24,352 23,342 24,520 34,186 181,494 18,871 297,151 15,221 13,874 148,607 4,646 1,171 1,007 49,300 8,310 31,699 4,475 $ 3,984,341
JUMA VENTURES STATEMENT OF CASH FLOWS Years Ended December 31, 2011 and 2010 2011 CASH FLOWS FROM OPERATING ACTIVITIES Change in net assets Adjustments to reconcile change in net assets to net cash provided (used) by operating activities Depreciation and amortization Loss on disposal of fixed assets Accrued interest on notes receivable Unrealized loss (gain) on investments (Increase) decrease in operating assets: Grants and contributions receivable Accounts receivable Inventory Prepaid expenses Deposits Increase (decrease) in operating liabilities: Accounts payable Accrued liabilities
$
129,541
2010 $
42,873 -
Net cash provided (used) by operating activities
3,076
49,300 4,475 (1,855) (1)
67,780 (16,358) (8,795) 5,964 (3,832)
(109,218) 14,087 (4,658) 8,680 (8,398)
8,500 (4,656)
32,851 30,266
221,017
18,605
CASH FLOWS FROM INVESTING ACTIVITIES: Collections on notes receivable Purchase of equipment Proceeds from investments Purchase of investments
38,959 (11,857) 154,400 (353,245)
38,959 (48,065) 27,996 -
Net cash provided (used) by investing activities
(171,743)
18,890
49,274
37,495
2,314,854
2,277,359
NET INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR CASH AND CASH EQUIVALENTS, END OF YEAR
See accompanying notes to financial statements. 5
$
2,364,128
$
2,314,854
JUMA VENTURES NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 2011
NOTE 1: DESCRIPTION OF THE ORGANIZATION Juma Ventures (Juma Ventures or Juma) is a nonprofit organization whose primary purpose is to operate youth development programs with the mission of breaking the cycle of poverty by ensuring that young people complete a four-year college education. Founded in 1993, Juma Ventures empowers low-income youth to make successful transitions to independence in adulthood through innovative programs that integrate employment in social enterprises, college preparation, career services and financial education. Business Employment and Workforce Resources: Juma owns and operates small businesses in each community to provide meaningful employment and development opportunities to low-income youth. The job experience youth receive is complemented by programs focused on college completion, including academic-based after-school programming and college preparation; opportunities for leadership development; and financial literacy education including access to matched savings accounts, which multiply and leverage student savings from job earnings. Juma offers three core program components that, together with case management, give youth a unique set of comprehensive services. The support and coaching that youth receive through personalized case management services provide youth with a stable and supportive environment. Over the course of their work with a Youth Development Coordinator (YDC), youth establish goals for building personal capabilities and life skills and receive support in working toward realizing them. Along with the other positive adult relationships that youth experience at Juma, the work with the YDC is a central part of the success realized by Juma youth. We believe and work with a theory of change that affirms that people change through relationships with others as those relationships are sustained over time. With support from the YDC, youth pursue their future goals for educational and economic success and self-sufficiency through three core programs: •
Job skills training and part-time employment at social enterprise concessions businesses at major sports stadiums. Employment opportunities are offered year-round and provide training and hands-on skill building in customer service, cash transactions, work readiness and personal responsibility, sales and supervision.
•
Education services and academic supports that encourage college matriculation and graduation. All Juma youth develop an education plan with the support of their YDC. Working together, they determine individual goals for higher education and plan the steps to reach those goals. They also complete a career interests assessment to help develop clear career goals. Youth participate in college tours on campuses and in career tours with major employers that help youth to understand the relevance of college. Juma specifically provides assistance with applications for college and financial aid, as well as standardized testing preparation, after school tutoring, and career workshops with panelists from various industries that encourage college completion.
•
Financial literacy education and asset-building that teaches youth how to manage their money through budgeting, debt and credit management, managing banking services, and learning to save. New youth complete a financial assessment and develop a financial plan. Through Individual Development Accounts, which match every dollar saved with two or three, depending on locale, youth are incentivized to save and focus on college.
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JUMA VENTURES NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 2011
NOTE 1: DESCRIPTION OF THE ORGANIZATION (continued) CollegeSet is a program that measurably improves the financial future of low-income high school students by helping them: (1) create savings that will be used to further their education, and (2) help them enroll in, afford, and successfully graduate from college. Juma works with nonprofit agencies in the San Francisco Bay Area and New York City that already provide in-depth direct support to youth and whose mission and goals can be supported by the addition of a financial capability education and college savings program. Juma holds a centralized administrative role to support these local community partners in the CollegeSet initiative. Replication: Juma’s replication efforts comprise the establishment of new enterprise and programmatic operations in new and existing markets. Key replication activities include staff travel, infrastructure development, and start-up of new social enterprise operations at major sports and entertainment venues. Juma’s leadership team travels to prospective markets for purposes of fund development and oversight of social enterprise start-up and operations. Direct staff travels to the San Francisco headquarters for orientation and training as part of Juma's new site development process. In 2011, staff capacity for San Diego increased and Juma opened a new office to reach youth in New York City through the CollegeSet program. Juma also initiated a strategic effort to align CSR strategies of major sports franchises, national vending and concessions companies, financial institutions, and other corporate partners toward a common vision: to create jobs for low-income young people throughout the country. Juma Ventures receives the majority of its revenues through grants, contributions, and sales generated from its employment projects which are located in the San Francisco Bay Area and San Diego. NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Net Assets Juma Ventures reports information regarding its financial position and activities according to three classes of net assets: unrestricted, temporarily restricted and permanently restricted. Unrestricted net assets – The portion of net assets that is neither temporarily restricted nor permanently restricted by donor-imposed stipulations. Temporarily restricted net assets – The portion of net assets whose use by Juma Ventures is limited by donor-imposed stipulations that either expire by passage of time or can be fulfilled and removed by actions of Juma Ventures. Temporarily restricted net assets at December 31, 2011 represent revenues restricted for program services. Permanently Restricted Net Assets – The portion of net assets whose use by Juma Ventures is limited by donor-imposed stipulations that neither expire by passage of time nor can otherwise be removed by actions of Juma Ventures. At December 31, 2011, Juma Ventures did not have any permanently restricted net assets.
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JUMA VENTURES NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 2011
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Revenue Recognition Unconditional contributions and grants are recognized at their fair value when the donor/grantor makes an unconditional promise to give to Juma Ventures. Contributions restricted by the donor are reported as an increase in unrestricted net assets if the restriction is released in the same reporting period in which the support is received. If the restriction is released in a different reporting period, such revenue is reported as temporarily restricted support and then reclassified to unrestricted net assets upon expiration of the restrictions. Revenue from government contracts is recognized as expenses are incurred. Revenue from employment projects is presented in the statement of activities before deduction of related costs. Related costs of goods sold and concession fees of $891,029 are presented in the statement of functional expenses. Net revenue from employment projects is $792,200 after deduction for these costs. Cash and Cash Equivalents Juma Ventures considers investments with an initial maturity of three months or less to be cash equivalents. Cash and cash equivalents include cash in banks, certificates of deposit, and money market funds. Investments Investments consist of certificates of deposit with initial maturities greater than three months and money market funds and are recorded at fair market value. Inventory Inventory is stated at the lower of cost or market, using the first-in, first-out method, and consists primarily of ice cream, beverages, food, and paper products. Property and Equipment Property and equipment are recorded at cost and are depreciated using the straight-line method over estimated useful lives of three to twenty years. Income Taxes Juma Ventures has been determined to be exempt from federal and state income taxes pursuant to Section 501(c)(3) of the Internal Revenue Code and Section 23701(d) of the California Revenue and Taxation Code.
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JUMA VENTURES NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 2011
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Income Taxes (continued) The Financial Accounting Standards Board issued new guidance on accounting for uncertainty in income taxes. Juma Ventures adopted this new guidance for the year ended December 31, 2009. Management evaluated Juma Ventures tax positions and concluded that Juma Ventures had maintained its tax exempt status and had taken no uncertain tax position that require adjustment to the financial statements. Therefore, no provision or liability for income taxes has been included in the financial statements. Advertising Costs Advertising costs are expensed as incurred. 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 amounts and disclosures. Accordingly, actual results could differ from those estimates. Indirect Expense Allocation Indirect expenses are allocated to program and support services based on estimates of time and usage determined by management. NOTE 3: CONTRIBUTIONS AND ACCOUNTS RECEIVABLE Contribution receivables of $360,097 are due from foundations as of December 31, 2011. Management has deemed all receivables to be fully collectable and therefore no allowance for doubtful accounts has been provided by management. NOTE 4: INVESTMENTS ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. In accordance with ASC 820, these inputs are summarized in the three broad levels listed below: Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the Trust has the ability to access. 9
JUMA VENTURES NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 2011
NOTE 4: INVESTMENTS (continued) Level 2 – Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. As of December 31, 2011, the investments held by Juma Ventures were deemed to be Level 1 assets. NOTE 5: NOTE RECEIVABLE A note receivable in the amount of $38,959 bearing interest at 5% from Evergreen Destination Holdings, LLC was repaid during the year. NOTE 6: PROPERTY AND EQUIPMENT Property and equipment and related accumulated depreciation, as of December 31, 2011 are as follows: Furniture and equipment Less: Accumulated depreciation/amortization Net property and equipment
$ $
417,918 (326,832) 91,086
Depreciation and amortization of leasehold improvements and equipment for the year ended December 31, 2011 totaled $42,873. NOTE 7: LEASES Juma Ventures is obligated under operating leases for its facility. The approximate future minimum lease payments related to this lease is as follows: 2012 2013 2014 2015 2016 Thereafter Total
$
223,449 231,528 189,439 187,087 197,907 8,265 $ 1,037,675
Total rent expense for the year ended December 31, 2011 was $200,481. During 2003, certain leasehold improvements were made on behalf of Juma Ventures by their former landlord. The value of these improvements is not determinable and, as a result, has not been reflected in the accompanying financial statements. 10
JUMA VENTURES NOTES TO THE FINANCIAL STATEMENTS Year Ended December 31, 2011
NOTE 8: COMMITMENTS AND CONTINGENCIES Grant awards require the fulfillment of certain conditions as set forth in the grant instruments. Failure to fulfill the conditions could result in return of the funds to the grantors. Juma Ventures deems this contingency remote. Management is of the opinion that Juma Ventures has complied with the terms of all grants. NOTE 9: TEMPORARILY RESTRICTED NET ASSETS As of December 31, 2011, temporarily restricted net assets of $1,229,607 are available for program services and employment development activities. Temporarily restricted net assets of $827,717 are restricted for the Individual Development Account (IDA) program participants’ savings match claims over a period of up to three years from the time the participant enters the program. Net assets of $2,031,695 were released during 2011 in accordance with the donors’ intent. NOTE 10: CONCENTRATION OF CREDIT RISK Juma Ventures has defined its financial instruments, which are potentially subject to credit risk as cash, investments and accounts receivable. At December 31, 2011, Juma Ventures had approximately $856,147 of cash deposits in excess of federally insured limits. Investments consist of money market funds and certificates of deposit. Grants and contributions receivables consist primarily of unsecured amounts due from foundations and governmental agencies. Approximately 67% of these receivables are due from two donors. For the year ended December 31, 2011, one concessionaire provided approximately 76% of the Employment Projects Revenue through exclusive contracts with the venues. NOTE 11: SUBSEQUENT EVENTS Juma Ventures has reviewed the results of operations for the period of time from December 31, 2011 through July 18, 2012, the date the financial statements are available to be issued, and has determined that no adjustments are necessary to the amounts reported in the accompanying financial statements and no subsequent events have occurred, the nature of which would require disclosure.
11