2012-377 Co Manager - Housing for New Hope Outside agency $20,000

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i HOUSING FOR NEW HOPE, INC. NOTES TO THE FINANCIAL STATEMENTS AUGUST 31, 2011 AND 2010 Note 1 —The Organization Housing for New Hope, Inc. (the Organization), a nonprofit corporation incorporated on November 2, 1993, is located in Durham, North Carolina. The mission of the Organization is to encourage and assist homeless people and other persons in crisis to move toward lives marked by increased levels of stability, dignity, hope and independence. The Organization provides a continuum of care for the homeless including emergency assistance and homeless prevention (Presbyterian Urban Ministry); outreach to mentally ill homeless in Durham and Orange counties (P.A.T.H.); assistance to homeless individuals and individuals on the verge of homelessness to obtain and maintain housing (Homeless Prevention/Rapid Re-housing Team); transitional housing (Phoenix House and Dove House), and permanent, affordable housing (Sherwood Park, Williams Square and Andover Apartments). Note 2—Summary of Significant Accounting Policies Basis of accounting — The financial statements of the Organization have been prepared in conformity with accounting principles generally accepted in the United States of America using the accrual basis of accounting. Basis of presentation — Financial statement presentation follows the provisions of the Financial Accounting Standards Board ASC 958, Not-for-Profit Entities. Under FASB ASC 958, the Organization is required to report information regarding its financial position and activities according to three classes of net assets: unrestricted net assets,temporarily restricted net assets and permanently restricted net assets. Net assets are defined as follows: • Unrestricted— Unrestricted net assets include resources, which are available for the support of the Organization's operating activities. • Temporarily Restricted—Temporarily restricted net assets include resources that have been donated to the Organization subject to restrictions as defined by the donor. These restrictions are met either by the actions of the organization and/or the passage of time. • Permanently Restricted — Permanently restricted net assets include resources that have donor-imposed restrictions stipulating that the resources be maintained intact in perpetuity with the investment income to be used for operating activities. Cash and cash equivalents — The Organization maintains its cash in bank demand deposit accounts which at times, may exceed federally insured limits. At August 31, 2011, the Organization had a balance of $102,219 in its bank, all of which was covered by federal insurance. A portion of the Organization's cash is restricted for purposes as specified by donors. Cash was restricted at August 31, 2011 and 2010 for purposes as specified in Note 7. Accounts receivable—The Organization has elected to record bad debts using the direct write- off method. Accounting principles generally accepted in the United States of America require that the allowance method be used to recognize bad debts; however, the effect of using the direct write-off method is not materially different from the result that would have been obtained under the allowance method. Property and Equipment— Property and equipment are recorded at cost or, if donated, at the fair value at the date of donation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets which range from three to forty years. The Organization normally capitalizes all expenditures for property and equipment in excess of$1,000; however, certain contractual arrangements require capitalization of expenditures in excess of$750. 10