chaos001 Posted December 1, 2012 Share Posted December 1, 2012 There are only a couple of interesting things (to me, anyway) about Phantom's Balance Sheet, one being Accounts Receivable and the other is "Permanently Restricted Assets". Cash, Accounts Receivable, and Inventories for Sale (presumably souvies and horns/drums) represent amounts available or convertible to use in fielding the corps. Land, obviously, does not. Cash and Grants Receivable didn't exceed $20,000 in any of these three years. Accounts Receivable more than doubled to over $100,000 from 2008 to 2009, and stayed above $100,000 in 2010. But then in 2011 they reduced their receivables to less than $50,000. Inventories for Sale stayed pretty consistent at about $45,000. Land, buildings, and Equipment (at cost) was steady at $203,000 in '09 and '10, but then jumped to almost $262,000 in 2011. They must have bought a truck or updated the kitchen (or something similar) in 2011. They made an addition and some repairs to the food truck. They also purchased a new van as the lead vehicle, but I think that'll show up in the 2012 returns. Quote Link to comment Share on other sites More sharing options...
garfield Posted December 1, 2012 Author Share Posted December 1, 2012 What's most interesting to me is that, between 2009 and 2010, there was a sizable addition to "Permanently Restricted Assets". It was zero in '09, but in 2010 it jumped to $246,035. "Permanently Restricted Assets" is usually some sort of contribution or grant to which the corps has only restricted annual access. That restriction is usually written into the grant or gift conditions. Did Phantom receive a large gift in 2010? The amount dropped to $232,777 in 2011, so they tapped about $13,000, plus whatever interest is being earned on the gift balance. If anyone knows the circumstances of this grant or gift, I'd like to know because that's great news (even if old news). The bad news is that, excluding that restricted gift, PR's 2011 assets are $210,210, and their liabilities are $234,788, of which $212,545 was accounts payable. So their net assets, again without the restricted asset, is a negative number. Looking back at post #439, their Net Revenue had declined from $146,131 in 2009 to $10,892 in 2011. Clearly, as of that date, Phantom Regiment was barely breakeven for the season, and had no cushion to help offset a bad year. There may be some provision in the restricted gift conditions that allows Phantom to tap some or all of the balance in a crisis. But it may be intended instead for only limited annual use and may not provide Phantom with much cushion at all. Quote Link to comment Share on other sites More sharing options...
Lincoln Posted December 1, 2012 Share Posted December 1, 2012 "Permanently Restricted Assets" is usually some sort of contribution or grant to which the corps has only restricted annual access. That restriction is usually written into the grant or gift conditions. Did Phantom receive a large gift in 2010? I have no idea where the amount came from but it does raise a question... If someone leaves a corps money in their will, would it fall into this category? Quote Link to comment Share on other sites More sharing options...
garfield Posted December 1, 2012 Author Share Posted December 1, 2012 I have no idea where the amount came from but it does raise a question... If someone leaves a corps money in their will, would it fall into this category? Surely. And they could write in conditions that make the gift restricted. But it also could have been made by someone still alive, or a corporation or even another 501c. Quote Link to comment Share on other sites More sharing options...
danielray Posted December 1, 2012 Share Posted December 1, 2012 I have no idea where the amount came from but it does raise a question... If someone leaves a corps money in their will, would it fall into this category? Hmm... this does get the wheels turning..... Now this is going to sound extremely morbid.. but here me out... One thing many corps have is a strong base of alumni. Life insurance companies would LOVE to have the opportunity for "bundled" sales.... Corps should cut deals with life insurance companies where they help promote to their alumni base, and % of potential pay outs are returned to the org. If someone came to me with a life insurance policy that was competitive and took care of my loved ones in the same way + kicked a bit to corps I had been involved with in my youth when I leave this mortal coil... no question I would go with that. This is a genuine opportunity. Corps should look at encouraging alumni estate planning as a way to develop an endowment. Quote Link to comment Share on other sites More sharing options...
garfield Posted December 1, 2012 Author Share Posted December 1, 2012 (edited) Hmm... this does get the wheels turning..... Now this is going to sound extremely morbid.. but here me out... One thing many corps have is a strong base of alumni. Life insurance companies would LOVE to have the opportunity for "bundled" sales.... Corps should cut deals with life insurance companies where they help promote to their alumni base, and % of potential pay outs are returned to the org. If someone came to me with a life insurance policy that was competitive and took care of my loved ones in the same way + kicked a bit to corps I had been involved with in my youth when I leave this mortal coil... no question I would go with that. This is a genuine opportunity. Corps should look at encouraging alumni estate planning as a way to develop an endowment. This is not a new idea, and it can be done in two ways. If there's no expectation for a charitable tax deduction on the part of the donor, simply adding the corps to the list of beneficiaries does the trick (no different than leaving money to a pet cat). If there's an expectation of a charitable deduction, either the donor would have to set up a charitable donor-advised fund and allow the purchase of life insurance, or the corps would receive the donation and would purchase life insurance on the life of the donor. In either case the donor must not have any incidence of control other than distribution of proceeds. And, of course, the has to be insurable. Plus, unless the donor expects to make an annual contribution to pay insurance premiums, you're likely talking about using only single-payment permanant insurance, or simple term life. The leverage attainable via insurance is limited to the single payment and the age of the donor. I'm, frankly, surprised that I haven't seen any donor advised fund contribution programs in any of the 990's so far. But DCI does have a foundation set up exactly for this purpose, if only more people knew about it. Grantor annuity trusts (GRATs), and Grantor Unit Trusts (GRUTs) are trusts designed to accomplish this, as well as Charitable Remainder trusts. And if set up properly, they can return a payment stream to the donor for his lifetime and leave the death benefit to the corps. Edited December 1, 2012 by garfield Quote Link to comment Share on other sites More sharing options...
danielray Posted December 1, 2012 Share Posted December 1, 2012 But DCI does have a foundation set up exactly for this purpose, if only more people knew about it. Set it up independent of DCI. Add me as the first guy. I need a new policy. :-) Quote Link to comment Share on other sites More sharing options...
garfield Posted December 1, 2012 Author Share Posted December 1, 2012 Set it up independent of DCI. Add me as the first guy. I need a new policy. :-) And, at your age, the annual payment would be quite manageable while the internal ROR on the contract would be attractive relative to today's interest rate environment. You know a guy who can handle this. You should PM him. :tongue:/> Quote Link to comment Share on other sites More sharing options...
garfield Posted December 2, 2012 Author Share Posted December 2, 2012 (edited) Most of today I've been studying Santa Clara's 990s. And Wow! am I impressed. Those of you who still have an interest in this project are going to enjoy seeing these numbers. There's a lot there, but I'll start posting the story in the morning. To give you a taste: SCV Gross Receipts 2009: $11,092,906 2010: $12,786,578 2011: $13,760,701 Strong growth and consistency. You'll see how well that transferred to their bottom line. Edited December 2, 2012 by garfield Quote Link to comment Share on other sites More sharing options...
Ghost Posted December 2, 2012 Share Posted December 2, 2012 SCV Gross Receipts 2009: $11,092,906 2010: $12,786,578 2011: $13,760,701 Strong growth and consistency. You'll see how well that transferred to their bottom line. WOW! They could write a check for that new equipment truck they have. Quote Link to comment Share on other sites More sharing options...
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