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6.C. - Page 35 of 124 <br />REDWOOD CITY IMPROVEMENT ASSOCIATION <br />(A California Nonprofit Corporation) <br />NOTES TO FINANCIAL STATEMENTS <br />NOVEMBER 30, 2018 AND 2017 <br />NOTE I -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES <br />Organization <br />The Redwood City Improvement Association (the Association) was incorporated in the State of California on <br />October 15, 2014 as a nonprofit public benefit corporation. The Association provides programs and services <br />within Downtown Redwood City and its surrounds to bring about its revitalization, its investment capital, and the <br />increased provision of quality public improvements of educational cultural, artistic, charitable and social services. <br />The Association is supported primarily through grants from the City of Redwood City. <br />Financial Statement Presentation <br />The accompanying financial statements are presented in accordance with Financial Accounting Standards Board <br />(FASB) Accounting Standards Codification (ASC) 958-210-50. Under ASC 958-210-50, the Association is <br />required to report information regarding its financial position and activities according to three classes of net <br />assets: unrestricted, temporarily restricted, and permanently restricted. In addition, the Association is required to <br />present a statement of cash flows. The Association does not use fund accounting. Revenues are recognized when <br />earned, and expenses are recognized when incurred in accordance with the accrual basis of accounting. <br />Cash and Cash Equivalents <br />Cash and cash equivalents for the purposes of the statement of cash flows consist of cash held in checking account <br />and available for current operations. The Association maintains cash balances in financial institutions which are <br />insured up to $250,000. At November 30, 2018, $408,149 in the bank exceeds Federal depository insurance <br />coverage. <br />Contributions, Grants and Promises to Give <br />Contributions and grants are recognized when the donor makes a promise to give to the Association that is, in <br />substance, unconditional. Contributions that are restricted by the donor are reported as increases in the <br />appropriate classification of net assets as temporarily or permanently restricted. When a restriction expires <br />through either the passage of time or use, the assets are reclassified as assets released from restrictions in the <br />statement of activities. <br />The Association uses the allowance method to determine uncollectible promises receivable. The allowance is <br />based on prior years' experience and management's analysis of specific promises made. In the current year, there <br />is no promise to give. <br />Contributions or grants received are recorded as unrestricted, temporarily restricted, or permanently restricted net <br />assets depending on the existence or nature of any donor restrictions. <br />0 <br />241 <br />