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ENVIRONMENTAL RESEARCH FOUNDATION. INC REPORT ON FINANCIAL STATEMENTS FOR THE PERIOD DECEMBER 1. 1990 TO DECEMBER 31. 1991 WITH COMPARATIVE TOTALS FOR THE YEAR ENDED NOVEMBER 30. 1990 C00427 t ENVIRONMENTAL RESEARCH FOUNDATION., INC,. , CONTENTS I Independent Auditors' Report Exhibit A - Balance Sheets, as of December 31, 1991, with Comparative Totals for November 30, 1990 Exhibit B - Statement of Revenue, Expenses and Changes in Fund Balance for the Period December 1, 1990 to December 31, 1991, with Comparative Totals for the Year Ended November 30, 1990 Notes to Financial Statements Page No, 2 3 4-5 6-7 000428 -1- MICHAEL C. GELMAN JERROLD ROSENBERG MICHAEL A. FREEDMAN DAVID F. GRALING WALTER H. DEYHLE ROBERT W. ALBRECHT Gelman, Rosenberg &. Freedman CERTIFIED PUBLIC ACCOUNTANTS A Pro/esstoruil Corporation SUITE 400 4800 HAMPDEN LANE BETHESDA, MARYLAND 20814 INDEPENDENT AUDITORS1 REPORT TELEPHONE (301) 951-9090 TELEFAX (301) 951-3570 To the Board of Directors Environmental Research Foundation, Inc. Washington, D.C. We have audited the balance sheet of the Environmental Research Foundation, Inc. as of December 31, 1991, and the related statement of revenue, expenses, and changes in fund balance for the period December 1, 1990 to December 31, 1991. These financial statements are the responsibility of the Foundation's management. Our responsibility is to express an opinion on these financial statements based on our audit. The financial statements of Environmental Research Foundation, Inc. as of November 30, 1990 were audited by other auditors whose report dated January 28, 1991 expressed an unqualified opinion on those statements. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as .well as evaluating the overall financial statement presentation. We belidve that our audit provides a reasonable basis for our opinion. , In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Environmental Research Foundation, Inc. as of December 31, 1991, and the results of operations for the period then ended in conformity with generally accepted accounting principles. February 21, 1992 2- - Member o f the American Institute o f Certified Public Accountants' Private Companies Practice Section 000-129 ENVIRONMENTAL RESEARCH FOUNDATION. INC. BALANCE SHEET AS OF DECEMBER 31. 1991 WITH COMPARATIVE TOTALS AS OF NOVEMBER 30. 1990 EXHIBITS Current Assets Cash Grants receivable Security deposit Other current assets Total current assets Furniture and Equipment Furniture Equipment Computer equipment ASSETS Less: Accumulated depreciation Net furniture and equipment Total Assets 1991 1990 $145,667 1,600 1.130 148.397 $ 85,825 35,000 1,750 2.300 124.875 6,960 14,578 41.021 62,559 X18_l03Z) 44.522 $192,919 11,478 4,413 21.842 37,733 (18.643> 19.090 $143,965 LIABILITIES AND FUND BALANCE Liabilities Accounts payable Deferred revenue Payroll taxes payable i Total liabilities Fund Balance Total Liabilities and Fund Balance $ 6,142 91,250 - 97,392 -95.527 $192,919 $ 11,700 49,583 838 62,121 81.844 $143,965 See accompanying notes to financial statements. -3- G00430 EXHIBIT B ENVIRONMENTAL RESEARCH FOUNDATION. INC. STATEMENT OF REVENUE. EXPENSES AND CHANGES IN FUND BALANCE FO R THE PERIOD DECEMBER 1. 1990 TO DECEMBER 31. 1991 WITH COMPARATIVE TOTALS FOR THE YEAR ENDED NOVEMBER 30. 1990 Revenue Grants Contributions Publication sales Special events Interest income General and Adm inistrat ive $ - Total revenue Exnenses Salaries Consultant Benefits Payroll taxes Rent, utilities and cleaning Repairs and maintenance Insurance Postage Printing Computer expenses Publication Membership Telephone Professional fees Supplies Contribution Conferences Travel Miscellaneous Depreciation Loss on disposal of furniture and equipment Special events Equipment rentals 24,514 - 884 1,417 5,203 - 304 1,370 862 1,499 145 765 1,435 3,255 1,105 - * ''145 938 ! 381 11,318 872 205 Total expenses 56.617 1991 Program $233,333 4,619 31,119 15,802 3.849 288.722 Total $233,333 4,619 31,119 15,802 3.849 288.722 1990 Total $140,000 4,136 27,017 - 3.477 174.630 107,055 - 4,030 6,447 25,404 - 1,481 22,184 10,725 6,796 3,287 35 5,456 2,462 5,501 350 1,215 9,217 1,059 - 4,484 1.234 218.422 131,569 - 4,914 7,864 30,607 - 1,785 23,554 11,587 8,295 3,432 800 6,891 5,717 6,606 350 1,360 10,155 1,440 11,318 872 4,484 1.439 275.039 59,698 1,000 800 2,461 16,203 396 - 18,851 8,472 5,763 5,028 520 4,602 7,560 4,192 500 529 10,130 195 4,778 - - 151.678 See accompanying notes to financial statements. -4- 000*131 ENVIRONMENTAL RESEARCH FOUNDATION. INC. EXHIBIT B (Continued) STATEMENT OF REVENUE. EXPENSES AND CHANGES IN FUND BALANCE FOR THE PERIOD DECEMBER 1. 1990 TO DECEMBER 31. 1991 WITH COMPARATIVE TOTALS FOR THE YEAR ENDED NOVEMBER 30. 1990 Excess (deficiency) of revenue with respect to expenses __________________ 1991________________ General and Administrative Program Total $(56,617) $ 70,300 $ 13,683 Fund balance at beginning of year 81.844 Fund Balance at End of Year $ 95,527 1990 Total $ 22,952 58.892 $ 81,844 See accompanying notes to financial statements. -5- C 0 0 `132 ENVIRONMENTAL RESEARCH FOUNDATION. INC. NOTES TO FINANCIAL STATEMENTS DECEMBER 31. 1991 1. Summary of Significant Accounting Policies and General Information Organization - Environmental Research Foundation, Inc. (ERF) was incorporated In New Jersey in 1980 as a nonprofit organization. ERF provides the public with useful information about environmental problems to enhance democratic decision making in the development of public policies leading to solutions. Basis of presentation - The Foundation's financial statements are prepared on the accrual basis of accounting. Therefore, revenue and related assets are recognized when earned and expenses and related liabilities are recognized when the obligations are incurred. During 1991, ERF changed its fiscal year end to December 31, 1991. The accompanying financial statements reflect the period from December 1, 1990 to December 31, 1991. Comparative data The amounts shown for 1990 in the accompanying financial statements are presented in accordance with the format recommended by the American Institute for Certified Public Accountants. This financial information ~ is included to provide a basis for comparison with 1991, presenting summarized totals only. Accordingly, the 1990 amounts are not intended to present all information necessary for a fair presentation in accordance with generally accepted accounting principles. Income taxes - ,i f The Foundation is exempt from Federal income taxes under Section 501(c)(3) of the Internal1Revenue Code. .Accordingly, no provision for income taxes has been made in the accompanying financial statements. Deferred revenue - Revenue from grants received in the current year to be used as support for the following year has appropriately been recorded as a current liability. Furniture and equipment - Furniture and equipment are stated at cost. Depreciation is provided on the straight-line basis over the estimated useful lives of the related assets, generally five years. -6- 000-133 f ENVIRONMENTAL RESEARCH FOUNDATION. INC. NOTES TO FINANCIAL STATEMENTS DECEMBER 31. 1991 2. Commitments In November, 1990, ERF entered into a lease expiring February 28, 1993 for office space. Minimum future rental payments required under the lease are as follows: 1992 1993 $19,200 3.200 $22,400 3. Litigation The Foundation is a defendant in a libel action brought by an Individual. Legal counsel for the Foundation has filed a motion to dismiss the plaintiff's claim on the grounds that the article was really a report of judicial and governmental activity, and therefore is absolutely privileged. The Foundation has not received a ruling from the court on that motion. In the opinion of the Foundation's management and legal counsel, there are other defenses available to them. It is not possible, at this time to estimate the amount of any possible adverse verdict, if any. -7- C00434