CHILD CARE RESOURCES FINANCIAL STATEMENTS With …

CHILD CARE RESOURCES

FINANCIAL STATEMENTS With Independent Auditor's Report

YEARS ENDED DECEMBER 31, 2013 AND 2012

OMB A-133 SUPPLEMENTAL FINANCIAL REPORTS YEAR ENDED DECEMBER 31, 2013

CHILD CARE RESOURCES

FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 2013 AND 2012

TABLE OF CONTENTS

INDEPENDENT AUDITOR'S REPORT

STATEMENTS OF FINANCIAL POSITION December 31, 2013 and 2012

STATEMENTS OF ACTIVITY Years ended December 31, 2013 and 2012

STATEMENTS OF FUNCTIONAL EXPENSES Years ended December 31, 2013 and 2012

STATEMENTS OF CASH FLOWS Years ended December 31, 2013 and 2012

NOTES TO FINANCIAL STATEMENTS

SUPPLEMENTARY INFORMATION Schedule of Expenditures of Federal Awards

Year ended December 31, 2013

Schedule of Expenditures of Non-Federal Governmental Awards Year ended December 31, 2013

Independent Auditor's Report Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards

Report on Compliance with Requirements Applicable to Each Major Program and on Internal Control Over Compliance in Accordance with OMB Circular A-133

Schedule of Findings and Questioned Costs

2 4 5 6 7 - 8 9 - 17

19 - 20 21 - 22

23

25 27

1

INDEPENDENT AUDITOR'S REPORT

May 1, 2014

Board of Directors Child Care Resources Seattle, Washington

We have audited the accompanying financial statements of Child Care Resources, which comprise the statements of financial position as of December 31, 2013 and 2012, and the related statements of activity, functional expenses and cash flows for the years 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.

Auditors' Responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing 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 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.

2

Opinion In our opinion, the financial statements referred to in the first paragraph present fairly, in all material respects, the financial position of Child Care Resources as of December 31, 2013 and 2012, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matters Other Information Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole. The accompanying schedule of expenditures of federal awards as required by U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations and the accompanying schedule of expenditures of non-federal governmental awards, are presented for purposes of additional analysis and are not a required part of the financial statements.

Such information is the responsibility of management and was derived 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.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated May 1, 2014 on our consideration of Child Care Resources' internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Child Care Resources' internal control over financial reporting and compliance.

Jacobson Jarvis & Co, PLLC

3

CHILD CARE RESOURCES STATEMENTS OF FINANCIAL POSITION

DECEMBER 31, 2013 AND 2012

Current Assets Cash and cash equivalents Certificates of deposit Accounts receivable Promises to give Prepaid expenses

ASSETS

2013

2012

$ 1,096,802 $ 1,015,364 1,156,948 244,620 218,459

853,185 996,510 862,864 181,345 179,621

Total Current Assets 3,732,193 3,073,525

Equipment, net of accumulated depreciation of $262,374 and $328,981

125,283

78,304

$ 3,857,476 $ 3,151,829

LIABILITIES AND NET ASSETS

Current Liabilities Accounts payable Accrued liabilities Deferred revenue Cash held for others

Net Assets Unrestricted Board designated Undesignated

Temporarily restricted

$ 145,536 $ 179,150

261,297

243,346

-

24,438

19,963

16,409

Total Current Liabilities

426,796

463,343

Total Unrestricted Net Assets

464,000 2,472,026

2,936,026 494,654

2,273,630

2,273,630 414,856

Total Net Assets 3,430,680 2,688,486

$ 3,857,476 $ 3,151,829

See notes to financial statements.

4

CHILD CARE RESOURCES STATEMENTS OF ACTIVITY YEARS ENDED DECEMBER 31, 2013 AND 2012

Public Support and Revenue Public support Government contracts and grants United Way of King County Contributions and private grants In-kind contributions

Unrestricted

2013 Temporarily

Restricted

Total

$ 5,224,896 26,535 $

424,036 123,521

306,061 173,070

-

$ 5,224,896 332,596 597,106 123,521

Total Public Support 5,798,988

479,131 6,278,119

Revenue Program services fees Investment income Other income

108,079 26,108 13,707

108,079 26,108 13,707

Net Assets Released from Restrictions Satisfaction of purpose restrictions Satisfaction of time restrictions

Total Revenue

147,894

147,894

399,333

(399,333)

-

-

-

-

Total Public Support, Revenue, and Other Support 6,346,215

79,798 6,426,013

Expenses Program services Management and general Fundraising

4,697,348 669,093 317,378

4,697,348 669,093 317,378

Total Expenses 5,683,819

5,683,819

Change in Net Assets

662,396

79,798

742,194

Net Assets - beginning of year

2,273,630

414,856 2,688,486

Net Assets - end of year

$ 2,936,026 $ 494,654 $ 3,430,680

2012 Temporarily Unrestricted Restricted

Total

$ 4,243,711 95,472 294,571 26,145

$ 235,004 148,573 -

$4,243,711 330,476 443,144 26,145

4,659,899 383,577 5,043,476

289,394 12,907 25,865

328,166

289,394 12,907 25,865

328,166

505,577 40,000

5,533,642

(505,577)

-

(40,000)

-

(162,000) 5,371,642

4,074,572 668,883 275,893

4,074,572 668,883 275,893

5,019,348

5,019,348

514,294 1,759,336

(162,000) 352,294 576,856 2,336,192

$ 2,273,630 $ 414,856 $2,688,486

See notes to financial statements.

5

CHILD CARE RESOURCES STATEMENTS OF FUNCTIONAL EXPENSES YEARS ENDED DECEMBER 31, 2013 AND 2012

Salaries and wages Employee benefits Payroll taxes

Provider Services and

Capacity Building $ 1,381,766

196,909 111,370

1,690,045

Family Services $ 684,019

105,354 53,486

842,859

2013

Total Program Services $ 2,065,785

302,263 164,856

2,532,904

Management

and

General Fundraising $ 374,553 $ 173,963

38,808

22,454

28,200

12,902

441,561 209,319

Total Expenses $ 2,614,301

363,525 205,958

3,183,784

Parent and provider assistance Professional fees Occupancy Supplies MIS expense In-kind expenses Equipment rent and repair Printing and publications Travel, lodging, and meals Other expenses Communication Dues, subscriptions, and advertising Staff development, training, & meetings Depreciation Insurance Postage and shipping Subcontracts

362,132 103,711 111,199 107,050

87,587 59,711 25,857 33,714 47,685 3,411 33,854 10,144 13,473 9,943 9,373 8,085

-

802,581 53,589 54,501 39,566 40,429 48,341 11,161 17,624

8,380 310

10,850 23,194

6,653 7,783 4,040 8,513

-

1,164,713 157,300 165,700 146,616 128,016 108,052 37,018 51,338 56,065 3,721 44,704 33,338 20,126 17,726 13,413 16,598 -

Total Expenses $ 2,716,974 $ 1,980,374 $ 4,697,348

66,429 26,013 17,267 12,767 14,302 17,522

784 729 41,847 2,631 2,320 9,410 5,713 8,257 1,541

-

30,727 12,627 28,467

6,791 1,167 3,757 5,844 1,022 6,377 1,900 2,080 2,552 2,473

757 1,518

-

1,164,713 254,456 204,340 192,350 147,574 123,521 58,297 57,966 57,816 51,945 49,235 37,738 32,088 25,912 22,427 19,657 -

$ 669,093 $ 317,378 $ 5,683,819

Provider Services and

Capacity Building $ 960,356

134,412 77,628

1,172,396

Family Services $ 662,248

97,385 51,422

811,055

2012

Total Program Services $ 1,622,604

231,797 129,050

1,983,451

Management

and

General Fundraising $ 365,740 $ 136,786

48,495

13,529

27,057

9,787

441,292 160,102

Total Expenses $ 2,125,130

293,821 165,894

2,584,845

368,284 35,865 130,622 98,717 69,538 3,970 12,966 27,663 21,480 3,488 28,710 9,755 14,102 11,112 7,704 7,378 79,012

813,196 51,237 68,258 42,282 51,242 2,750 4,574 45,454 12,009 2,243 20,008 20,553 8,552 6,033 5,148 7,216

-

1,181,480 87,102 198,880 140,999 120,780 6,720 17,540 73,117 33,489 5,731 48,718 30,308 22,654 17,145 12,852 14,594 79,012

$ 2,102,762 $ 1,971,810 $ 4,074,572

-

75,673 34,810 25,183 16,258 16,933 17,078

402 1,073 6,825 3,036 6,199 8,376 6,704 7,703 1,338

-

-

40,041 14,386 28,712

6,037 2,492 3,794 3,980

813 3,780 1,844 1,935 2,409 2,760

679 2,129

-

1,181,480 202,816 248,076 194,894 143,075 26,145 38,412 77,499 35,375 16,336 53,598 38,442 33,439 26,609 21,234 18,061 79,012

$ 668,883 $ 275,893 $ 5,019,348

See notes to financial statements.

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CHILD CARE RESOURCES STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2013 AND 2012

Cash Flows from Operating Activities Cash received from: Government agencies Donors Program participants Employers Investment income Other income Cash paid to: Employees Vendors

2013

2012

$ 4,903,622 869,981 107,711 3,250 7,254 13,577

$ 3,784,086 791,628 289,564 3,150 5,188 25,636

(3,315,080) (2,635,185) (2,273,659) (2,301,447)

Net Cash Provided (Used) by Operating Activities

316,656

(37,380)

Cash Flows from Investing Activities Maturities of certificates of deposit Purchases of equipment

(73,039)

8,923 (7,674)

Net Cash (Used) Provided by Investing Activities

(73,039)

1,249

Change in Cash and Cash Equivalents

243,617

(36,131)

Cash and Cash Equivalents - beginning of year

853,185

889,316

Cash and Cash Equivalents - end of year

$ 1,096,802 $ 853,185

See notes to financial statements.

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