Page 17 - FY 2021-2022 Audited Financial Statements

Child Care Resource Center, Inc. Notes to Financial Statements
Note 2 – Summary of Significant Accounting Policies (continued)
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.
In-kind contributions – Donated office space, donated equipment, and other donated goods and services are recorded at their estimated fair value as of the date of the donation if the fair value exceeds $1,000. Contributed services are recognized if the services (a) create or enhance long-lived assets, or
(b) require specialized skills, which are provided by individuals possessing those skills and would need to be purchased if not provided by donation. CCRC received professional services relating to the Head Start Program valued at $118,240 and $111,230 for the years ended June 30, 2022 and 2021, respectively. These services were utilized during each respective year and had no donor restrictions beyond their use in the Head Start Program. The estimated fair value of these professional services is provided by the service provider, who estimates the fair value based on the date, time, and market in which each service is rendered.
Functional expenses – The costs of providing the various programs and other activities have been summarized both on a natural and functional basis in the accompanying statements of activities and detailed in the statements of functional expenses. Expenses that can be identified as belonging to a specific program or support function are charged directly to that function. Expenses that are attributed to more than one program or support function have been allocated on a reasonable methodology that is consistently applied among the programs and supporting services benefited, based upon management’s estimates, time studies, and use of resources. Certain facility-related costs, which are allocated on a square-footage basis, as well as personnel expenses, office expenses, insurance, professional services, and other expenses allocated on the basis of time and effort, have been allocated between program services, general and administrative, and fundraising. Administrative department staff and expenses are charged entirely to general and administrative. Fundraising costs of $251,429 and $226,474 for the years ended June 30, 2022 and 2021, respectively, were not charged to any child development contracts.
Income taxes – CCRC has been designated as tax-exempt under Internal Revenue Code Section 501(c)(3) and is also exempt from state franchise taxes under Section 23701(d) of the California Revenue and Taxation Code and is not generally subject to federal or state income taxes. CCRC files an exempt organization return in the U.S. federal jurisdiction and the State of California.
However, CCRC is subject to income taxes on any net income that is derived from a trade or business, regularly carried on, and not in furtherance of the purposes for which it was granted exemption. No income tax provision has been recorded as the net income, if any, from any unrelated trade or business and, in the opinion of management, is not material to the financial statements. CCRC has determined no uncertain tax benefits or liabilities exist at June 30, 2022 and 2021.
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