Audited

Financial Statements

The Boston Harbor Association, Inc.

December 31, 2011






































The Boston Harbor Association, Inc.


Audited Financial Statements

December 31, 2011



INDEPENDENT AUDITORS' REPORT 1

AUDITED FINANCIAL STATEMENTS

STATEMENTS OF FINANCIAL POSITION 2

STATEMENTS OF ACTIVITIES AND CHANGES IN NET ASSETS 3

STATEMENTS OF CASH FLOWS 4

NOTES TO FINANCIAL STATEMENTS 5

OTHER FINANCIAL INFORMATION

INDEPENDENT AUDITORS' REPORT 9

SCHEDULES OF FUNCTIONAL EXPENSES 10











INDEPENDENT AUDITORS' REPORT







Board of Trustees
The Boston Harbor Association, Inc.


We have audited the accompanying statements of financial position of The
Boston Harbor Association, Inc. as of December 31, 2011 and 2010, and the
related statements of activities and changes in net assets and cash flows for
the years then ended. These financial statements are the responsibility of the
Association's management. Our responsibility is to express an opinion on
these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit 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 believe that our
audits provide 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 Boston Harbor Association, Inc.
at December 31, 2011 and 2010 and the results of its activities and cash flows
for the years then ended, in conformity with accounting principles generally
accepted in the United States of America.

G. T. Reilly & Company

Milton, Massachusetts
September 19, 2012

G.T. Reilly & Company
ReillyTech
Reilly Benefits
Reilly Business Services

424 Adams Street
Milton, MA 02186-4358
617 696-8900
617 698-1803 fax
www.gtreilly.com



2

The accompanying notes are an integral part of these financial statements.
The Boston Harbor Association, Inc.
Statements of Financial Position
December 31
ASSETS 2011 2010
CURRENT ASSETS
Cash and cash equivalents (Note 1) 266,662 $ 292,959 $
Prepaid expenses 765 2,265
TOTAL CURRENT ASSETS 267,427 295,224
EQUIPMENT (Note 1)
Office equipment 45,549 41,918
Less accumulated provisions for depreciation (41,591) (39,472)
3,958 2,446
FUNDS HELD FOR OTHERS (Note 5) 40,188 59,674
TOTAL ASSETS 311,573 $ 357,344 $
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
Accounts payable 5,599 $ 1,802 $
Accrued expenses 32,077 31,097
TOTAL CURRENT LIABILITIES 37,676 32,899
FIDUCIARY LIABILITY (Note 5) 40,188 59,674
NET ASSETS (Note 1)
Unrestricted 222,030 259,344
Temporarily restricted (Note 4) 11,679 5,427
TOTAL NET ASSETS 233,709 264,771
TOTAL LIABILITIES AND NET ASSETS 311,573 $ 357,344 $



3

The accompanying notes are an integral part of these financial statements.
The Boston Harbor Association, Inc.
Statements of Activities and Changes in Net Assets
Year Ended December 31:
Temporarily Temporarily
Unrestricted Restricted Total Unrestricted Restricted Total
REVENUE AND SUPPORT
Gifts and donations 49,357 $ - $ 49,357 $ 8,324 $ - $ 8,324 $
Grants 29,045 49,999 79,044 66,499 35,000 101,499
Memberships 64,129 - 64,129 77,143 - 77,143
Event income 186,080 - 186,080 187,712 - 187,712
Contributed facilities (Notes 1 & 3) 28,000 - 28,000 28,000 - 28,000
Other income 1,321 - 1,321 1,077 - 1,077
Net assets released from restrictions
through satisfaction of restrictions (Notes 1 & 4) 43,747 (43,747) - 29,573 (29,573) -
TOTAL REVENUES AND SUPPORT 401,679 6,252 407,931 398,328 5,427 403,755
Expenses:
Program service 296,156 - 296,156 283,808 - 283,808
Management & general 90,479 - 90,479 89,233 - 89,233
Fundraising 52,358 - 52,358 52,194 - 52,194
TOTAL EXPENSES 438,993 - 438,993 425,235 - 425,235
CHANGE IN NET ASSETS (37,314) 6,252 (31,062) (26,907) 5,427 (21,480)
NET ASSETS AT BEGINNING OF YEAR 259,344 5,427 264,771 286,251 - 286,251
NET ASSETS AT END OF YEAR 222,030 $ 11,679 $ 233,709 $ 259,344 $ 5,427 $ 264,771 $
2011 2010



4

The accompanying notes are an integral part of these financial statements.
The Boston Harbor Association, Inc.
Statements of Cash Flows
Year Ended December 31
2011 2010
CASH FLOWS FROM OPERATING ACTIVITIES
Change in net assets (31,062) $ (21,480) $
Adjustments to reconcile change in net assets
to net cash provided by operating activities:
Depreciation 2,119 6,309
Changes in operating assets and liabilities:
Prepaid expenses 1,500 (1,198)
Accounts payable 3,797 1,802
Accrued expenses 980 (1,327)

NET CASH USED IN OPERATING ACTIVITIES (22,666) (15,894)
CASH FLOWS USED IN INVESTING ACTIVITIES
Additions to office equipment (3,631) -
NET DECREASE IN CASH AND CASH EQUIVALENTS (26,297) (15,894)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 292,959 308,853
CASH AND CASH EQUIVALENTS AT END OF YEAR 266,662 $ 292,959 $




5
The Boston Harbor Association, Inc.


Notes to Financial Statements

December 31, 2011


Note 1 Nature of Activities and Significant Accounting Policies

Nature of Activities The Boston Harbor Association, Inc. (the Association) is a nonprofit association of
individual, corporate and organizational members allied to enhance Boston Harbor through balanced,
environmentally sensitive and accessible development, maintenance, and use. The Association advocates
for greater public access, open spaces, and public amenities along Boston Harbor, monitors water quality
improvements and supports the restoration of Boston Harbor beaches for swimming, supports a
comprehensive and affordable water transportation network throughout the Harbor, educates urban youths
about Boston Harbor and related career opportunities, and promotes a "green" working port and waterfront.
The Association is also a leader in focusing attention on sea-level rise in Boston Harbor.

Basis of Accounting The financial statements of the Association have been prepared on the accrual basis
of accounting.

Financial Statement Presentation The Association reports information regarding its financial position and
activities according to three classes of net assets as determined by donor-imposed restrictions: unrestricted
net assets, temporarily restricted net assets, and permanently restricted net assets.

Unrestricted Net Assets Unrestricted net assets are those net resources that bear no external
restrictions and are generally available for use by the Association. Unrestricted contributions are
recorded as support when received or unconditionally committed.

Temporarily Restricted Net Assets Restricted grants and contributions are recorded as temporarily
restricted support and net assets when received or committed. Transfers are made to unrestricted net
assets as costs are incurred or time restrictions or program restrictions have lapsed (see Note 4).

Permanently Restricted Net Assets Contributions established by donor restrictions to permanently
maintain the principal, while allowing the use of income generated therefrom, are classified as
permanently restricted support and net assets. Income derived from the investment of permanently
restricted funds is reported as unrestricted revenue or as restricted revenue depending on the terms
of the donor instrument. Unrealized gains or losses on permanently restricted fund investments are
reported as increases or decreases in temporarily restricted net assets unless the donor explicitly
states otherwise. There are no permanently restricted net assets at December 31, 2011 and 2010.

Contributions and Donor Restrictions The Association reports grants and contributions of cash or other
assets in the statement of activities as temporarily restricted net assets when received, if they are received
with donor stipulations that limit, specify or otherwise restrict the use of such contributions. When a donor
restriction expires, either by use of the funds for the specified purpose or by the expiration of a time
restriction, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the
statement of activities as net assets released from restrictions. Contributions are recorded as unrestricted
net assets if the restrictions are met in the year that the contribution is made. Additionally, contributions of
donated non-cash assets are recorded at their fair values in the period received.

Accounting Estimates The presentation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported amounts of revenue, support and
expenses during the reporting period. Accordingly, actual results could differ from those estimates.


6
Note 1 - Nature of Activities and Significant Accounting Policies (Cont.)

Cash Equivalents For purposes of the statement of cash flows, the Association considers all highly-liquid
investments with a maturity of three months or less at the time of acquisition to be cash equivalents.

Equipment Equipment is recorded at cost or, in the case of donated assets, at fair market value.
Expenditures for maintenance and repairs are charged to expense as incurred, whereas major betterments
are capitalized as additions to property and equipment. Depreciation is computed using the straight-line
method over the estimate asset useful life of 5 years. Depreciation expense for 2011 is $2,119 ($6,309 in
2010).

Income Taxes The Association is exempt from federal income taxes under Section 501(c)(3) of the
Internal Revenue Code. The Association is also exempt from Massachusetts state income taxes and,
therefore, has made no provision for federal or state income taxes in the accompanying financial
statements.

Contributed Facilities and Services The difference between the estimated fair rental value of the facilities
and the amounts actually paid for rent is recorded as support with an equivalent amount recorded as rent
expense (see Note 3).

During the years ended December 31, 2011 and 2010, the value of contributed services meeting the
requirements for recognition was not material and not recorded in the accompanying statements of
activities. Many individuals volunteer their time and perform a variety of tasks that assist the Association
however; these services do not meet the criteria for recognition as contributed services in the financial
statements.

Functional Allocation of Expenses The costs of providing various programs and other activities have been
summarized on a functional basis in the statement of activities. Accordingly, certain costs have been
allocated among the programs and supporting services benefited.

Evaluation of Subsequent Events In accordance with generally accepted accounting principles,
management has evaluated subsequent events involving the Association for potential recognition or
disclosure in the accompanying financial statements. Subsequent events are events or transactions that
occurred after December 31, 2011, up through September 19, 2012, the date the accompanying financial
statements were available to be issued.


Note 2 - Pension Plan

The Association sponsors a Simple IRA plan for those employees eligible for participation. Contributions
made for the year ended December 31, 2011 totaled $8,658 ($7,748 in 2010).


Note 3 Contributed Facilities

The Association originally entered into a lease expiring on December 31, 2012 requiring an annual base
rent of $1. On December 1, 2011, the Association entered an agreement to extend this lease term through
December 31, 2015. Accordingly, for the years ended December 31, 2011 and 2010 the Association has
recorded as support contributed facilities of $28,000 representing the fair value of the rented facilities, with
an equivalent amount recorded as rent expense in both years. In addition, the Association is responsible for
its portion of real estate taxes and operating expenses which totaled $10,353 and $13,352 for the years
ended December 31, 2011 and 2010, respectively.



7
Note 4 Temporarily Restricted Net Assets

Temporarily restricted net assets are restricted for the following purposes and programs as follows at
December 31:

2011 2010
Cedar Tree Harbor Bound 10,000 $ - $
Barr Foundation Sea-Level Rise - 5,427
Marine Debris 1,679 -
11,679 $ 5,427 $


Temporarily restricted net assets released and used for the following purposes for the year ended
December 31:

2011 2010
Barr Foundation Sea-Level Rise 5,427 $ 29,573 $
Marine Debris 38,320 -
43,747 $ 29,573 $

Note 5 Funds Held for Others

In a prior year, the Association accepted donations on behalf of the Judge A. David Mazzone Deer Island
Memorial Committee, Inc., for the purpose of creating and maintaining a memorial for Judge Mazzone on
Deer Island. The Association does not have oversight or responsibility as to how the funds are used and
only acts as a custodian to the funds. The funds are maintained in a separate bank account. The
Association reports unexpended cash as funds held for others in its statement of financial position with an
equivalent amount reported as fiduciary liability. As of December 31, 2011 and 2010, the fiduciary funds
and liability attributable to the Mazzone Fund were $40,188 and $59,674, respectively. A summary of funds
received and disbursed to maintain the memorial for the years ended December 31, 2011 and 2010 is as
follows:

Funds held for others at December 31, 2009 64,925 $
Interest earned 35
Cash disbursements (5,286)
Funds held for others at December 31, 2010 59,674
Interest earned 26
Cash disbursements (19,512)
Funds held for others at December 31, 2011 40,188 $


Included in the cash disbursements for 2011, is a grant of $15,044 to the Association, which is considered
a quasi-related party.


8
Note 6 - Financial Instruments, Credit Risk and Concentration Risks

The Associations financial instruments that may be subject to concentrations of credit risk consist of cash
and cash equivalents.

The Association maintains its cash deposits with a high-quality financial institution. At December 31, 2011,
bank balances did not exceed the FDIC insurance limit. The Associations cash equivalents consist of
money market funds held by a national investment house, which approximates $234,000 at December 31,
2011.

The Association receives its support and revenues from individuals, corporations, charitable organizations
and foundations located within Massachusetts. In addition, several members of the Board of Directors are
employed by corporations or charitable organizations, or associated with foundations that contribute to the
Association.

The following is a schedule of significant donations for the year ended December 31:
2011 2010
% of total % of total
Donor Amount Donations Amount Donations
Corporation 20,000 $ 41% *
Massachusetts Port Authority 10,000 $ 20% *
Boston Redevelopment Authority 6,000 $ 12% *
* Not a major concentration in 2010
The following is a schedule of significant grants for the year ended December 31:
2011 2010
% of total % of total
Grantor Amount Grants Amount Grants
Mass Water Resources Authority 20,000 $ 25% *
Mazzone Fund 15,000 $ 19% *
Foundation 10,000 $ 13% 35,000 $ 35%
City of Boston 10,000 $ 13% *
Boston Water and Sewer Commission 10,000 $ 13% 20,000 $ 20%
* Not a major concentration in 2010
The following is a schedule of significant membership income for the year ended December 31:
2011 2010
% of total % of total
Membership Membership
Member Amount Income Amount Income
Corporation 10,000 $ 16% 10,000 $ 15%
Corporation 8,500 $ 13% *
* Not a major concentration in 2010





















OTHER FINANCIAL INFORMATION



9










INDEPENDENT AUDITORS' REPORT







Board of Trustees
The Boston Harbor Association, Inc.


Our report on our audits of the basic financial statement of the Association
appears on Page 1. Our audits were made for the purpose of forming an
opinion on the basic financial statements as a whole. The accompanying
schedules of functional expenses for the years ended December 31, 2011 and
2010 are presented for purposes of additional analysis and are not a required
part of the basic financial statements. The information has been subjected to
the auditing procedures applied in the audits of the basic financial statements,
and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to
prepare the financial statements or to the financial statements themselves, and
other additional procedures in accordance with auditing standards generally
accepted in the United States of America. In our opinion, the information is
fairly stated in all material respects in relation to the basic financial statements
as a whole.

G. T. Reilly & Company


Milton, Massachusetts
September 19, 2012

G.T. Reilly & Company
ReillyTech
Reilly Benefits
Reilly Business Services

424 Adams Street
Milton, MA 02186-4358
617 696-8900
617 698-1803 fax
www.gtreilly.com



10

The accompanying notes are an integral part of these financial statements.
The Boston Harbor Association
Statements of Functional Expenses
For the year ended December 31:
Program General and Program General and
Services Administrative Fundraising Total Services Administrative Fundraising Total
Salaries 179,662 $ 22,458 $ 22,458 $ 224,578 $ 166,512 $ 20,814 $ 28,930 $ 216,256 $
Pension plan contribution 6,926 866 866 8,658 6,198 775 775 7,748
Employee benefits 10,190 1,274 1,274 12,738 7,230 904 904 9,038
Payroll taxes 12,596 1,575 1,575 15,746 11,788 1,474 2,048 15,310
Event expenses 27,188 - 23,031 50,219 39,458 - 18,212 57,670
Outside services 31,462 - - 31,462 39,236 - - 39,236
Rent - 37,288 - 37,288 - 40,408 - 40,408
Office expense 11,268 1,409 1,409 14,086 8,067 1,009 1,008 10,084
Legal and accounting - 13,657 - 13,657 - 7,388 - 7,388
Consulting 11,836 1,480 1,480 14,796 - - - -
Telephone 2,819 2,819 - 5,638 2,215 2,215 - 4,430
Transportation 2,121 265 265 2,651 2,537 317 317 3,171
Depreciation - 2,119 - 2,119 - 6,309 - 6,309
Building repairs - 1,119 - 1,119 - 2,151 - 2,151
Postage and shipping 88 88 - 176 567 567 - 1,134
Utilities - 1,065 - 1,065 - 944 - 944
Insurance - 1,583 - 1,583 - 1,596 - 1,596
Miscellaneous - 1,414 - 1,414 - 2,362 - 2,362
296,156 $ 90,479 $ 52,358 $ 438,993 $ 283,808 $ 89,233 $ 52,194 $ 425,235 $
2011 2010