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Child Care Resource Center, Inc. Notes to Financial Statements
Note 2 – Summary of Significant Accounting Policies (continued)
Net assets with donor restrictions – Include those assets which are limited as to use by donor-imposed stipulations that may expire with the passage of time, or that may be satisfied by action of CCRC, or may be required by donors to be held in perpetuity. When a restriction expires (that is, when a stipulated time restriction ends or the purpose restriction is accomplished), net assets with donor restrictions are reclassified to net assets without donor restrictions and reported in the statements of activities as net assets released from restrictions. As of June 30, 2021 and 2020, there were no net assets with donor restrictions.
Grant revenue – Grant revenue consists of grants received from CDE, Department of Health & Human Services – Administration for Children & Families (DHHS – ACF), Los Angeles County – Department of Public Health (LADPH), and various governmental funding sources. These sources of support are to be spent for specific purposes. Child care services and general and administrative expenses are funded in part by CDE, DHHS – ACF, LADPH, and other grants, which are subject to annual budget negotiations and availability of funds. Revenue from grants and contracts that are nonreciprocal is treated like contributions. If the grant or contract is conditional, a barrier to entitlement exists. Revenue is recognized when the barrier is considered overcome and as allowable expenditures under such agreements are incurred, as an increase to net assets without donor restrictions. If the grant or contract is unconditional, revenue is reported as an increase in net assets without donor restrictions.
Consequently, revenues for these transactions are recognized as the expenditures are incurred. Any difference between expenses incurred and the total funds received (not to exceed the grant maximum) is recorded as government contracts receivable or due to funding agencies.
Fees for service – CCRC receives support from the Los Angeles County Department of Public Social Services (DPSS) under the CalWORKs welfare-to-work program. CCRC receives reimbursements for payments to providers and an administrative fee per family served per month under this program. Amounts received under this program are reflected as “fees for services” in the accompanying statements of activities as services are performed.
Family fees – Under the Child Care Financial Assistance Program, families may be responsible for paying a portion of their child care, referred to as family fees. Family fees are determined based on the family’s income and size. CCRC collects family fees on the first day of every month and recognizes when services have been provided.
Contributions – CCRC recognizes contributions, including unconditional promises to give, as support in the period received. CCRC reports contributions of cash and other assets as restricted support if they are received with donor stipulations that limit the use of the donated assets. When a donor restriction expires, that is, when a stipulated time restriction ends and/or purpose restriction is accomplished, net assets with donor restrictions are reclassified as net assets without donor restrictions and reported in the statements of activities as net assets released from restrictions.
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