Independent Adoption Center, Inc.

Audited Financial Statements

For Year Ended December 31, 2014

Rubian Moss, CPA

A Professional Corporation
 Independent Adoption Center, Inc.

Financial Statements

Year ended December 31, 2014

Contents

Independent Auditors Report............................................................................ 1

Financial Statements
Statement of Financial Position...................................................................... 2
Statement of Activities................................................................................... 3
Statement of Cash Flows............................................................................... 4
Statement of Functional Expenses.................................................................. 5
Notes to Financial Statements........................................................................ 7
 Independent Auditors Report
Board of Directors
Independent Adoption Center, Inc.
Concord, California

We have audited the accompanying financial statements of he Independent Adoption Center, Inc., a nonprofit tax-exempt
corporation, which comprise the statement of financial position as of December 31, 2014 and the related statements of
activities, cash flows, and functional expenses for the year then ended, and the related notes to the financial statements.
Managements Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
accounting principles generally accepted in the United States of America; this includes the design, implementation, and
maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from
material misstatement, whether due to fraud or error.
Auditors Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit 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 involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entitys preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entitys internal control. Accordingly, we express no such opinion. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by
management, as well as evaluating the overall presentation of the financial statement.
We believe that our audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the
Independent Adoption Center, Inc. as of December 31, 2014 and the changes in its net assets and its cash flows for the year
then ended in accordance with accounting principles generally accepted in the United States of America.

Walnut Creek, California

July 3, 2015

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 Independent Adoption Center, Inc.

Statement of Financial Position

As of December 31, 2014

Assets
Current assets:
Cash and cash equivalents $ 1,391,878
Accounts receivable, net (Note 2) 981,314
Prepaid expenses 122,683
Total current assets 2,495,875
Fixed assets, net (Note 3) 51,880
Deposits 45,360
Total assets $ 2,593,115

Liabilities and net assets

Current liabilities:
Accounts payable and accrued liabilities $ 119,569
Accrued vacations 173,729
Deferred revenue 37,743
Total current liabilities 331,041

Net assets 2,262,074

Total liabilities and net assets $ 2,593,115

See accompanying notes.

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 Independent Adoption Center, Inc.

Statement of Activities

For the year ended December 31, 2014

Support and revenue

Support:
Foundations and corporations $ 25,554
Indivdual donations 6,765
Total support 32,319

Revenue:
Client fees 6,055,942
Domestic homestudy fees 513,147
Counseling fees 96,304
Birth Parent expense funding 183,294
Post adoption fees 24,815
Other revenue 8,764
Investment income 12,489
Client refunds (337,949)
Total revenue 6,556,806
Total support and revenue 6,589,125

Expenses
Program:
Concord 2,244,988
Los Angeles 723,465
Connecticut 13,789
Indiana 334,151
Georgia 462,973
North Carolina 511,911
Texas 362,967
New York 460,930
Florida 266,981
Total program expenses 5,382,155

Support:
Management and general 767,372
Fundraising 1,272
Total support expenses 768,644
Total expenses 6,150,799

Change in net assets 438,326

Net assets, beginning of year 1,823,748
Net assets, end of year $ 2,262,074

See accompanying notes.

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 Independent Adoption Center, Inc.

Statement of Cash Flows

For the year ended December 31, 2014

Cash flows from operating activities:

Change in net assets $ 438,326
Adjustments to reconcile change in net assets
to net cash provided by operating activities:
Depreciation 23,094
Increase in accounts receivable (263,915)
Decrease in prepaid expenses 60,972
Decrease in deposits 1,085
Decrease in accounts payable and accrued liabilities (39,796)
Increase in accrued vacations 786
Increase in deferred revenue 9,563
Net cash provided by operating activities 230,115

Investing activities
Acquisition of fixed assets (11,777)
Net cash used in investing activities (11,777)

Net change in cash 218,338

Cash, beginning of year 1,173,540
Cash, end of year $ 1,391,878

See accompanying notes.

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 Independent Adoption Center, Inc.

Statement of Functional Expenses

For the year ended December 31, 2014

Los North
Concord Angeles Connecticut Indiana Georgia Carolina Texas

Salaries $ 980,514 $ 355,813 $ - $ 145,978 $ 227,700 $ 242,407 $ 143,550

Payroll taxes 176,378 - 10 - 674 1,809 -
Employee benefits 148,085 22,147 - 29,049 32,230 34,450 19,833
Total personnel expenses 1,304,977 377,960 10 175,027 260,604 278,666 163,383
Professional services 72,157 108,734 - 9,990 4,828 53,443 22,109
Advertising 80,128 64,995 - 63,520 63,670 64,645 64,570
Insurance 94,525 1,016 - 1,016 1,016 1,016 1,132
Interest - - - - - - -
Client education 24,707 10,238 - 4,134 6,485 4,983 4,627
Board expense - - - - - - -
Birth Parent expense 101,954 6,674 - 3,332 25,254 15,139 9,679
Rent 197,651 56,320 11,326 19,074 30,768 31,430 31,258
Office expense 21,832 334 9 10,488 5,987 10,156 7,641
Service fees 70,323 373 43 295 3,057 162 122
Equipment rental 32,739 8,532 - 10,467 8,751 5,071 6,367
Telephone 17,725 9,876 2,055 12,002 6,103 5,159 7,261
Printing 3,725 439 - 584 1,782 316 501
Postage 51,153 6,221 46 4,304 8,799 5,638 3,602
Dues and subscriptions 3,429 1,173 - 1,074 863 638 889
Travel 33,525 47,790 300 8,009 17,302 18,433 29,639
Information technology 22,563 8,348 - 3,504 1,839 9,904 2,166
Staff development 1,850 1,588 - 465 1,504 369 1,169
Staff appreciation 17,616 822 - 803 1,092 983 358
Agency services 1,689 761 - 1,754 961 550 1,971
Outreach 71,090 11,271 - 4,309 12,308 5,210 4,523
Depreciation 19,630 - - - - - -
Bad debt - - - - - - -
Total $ 2,244,988 $ 723,465 $ 13,789 $ 334,151 $ 462,973 $ 511,911 $ 362,967

See accompanying notes.

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 Independent Adoption Center, Inc.

Statement of Functional Expenses (continued)

For the year ended December 31, 2014

Total Management Total

New York Florida Program and General Fundraising Support Total

Salaries $ 177,442 $ 96,509 $ 2,369,913 $ 418,220 $ - $ 418,220 $ 2,788,133

Payroll taxes 3,423 367 182,661 32,234 - 32,234 214,895
Employee benefits 14,691 13,775 314,260 55,458 - 55,458 369,718
Total personnel expenses 195,556 110,651 2,866,834 505,912 - 505,912 3,372,746
Professional services 33,251 8,645 313,157 14,172 - 14,172 327,329
Advertising 70,414 65,269 537,211 - - - 537,211
Insurance 1,016 1,016 101,753 17,955 - 17,955 119,708
Interest - - - 5,828 - 5,828 5,828
Client education 11,034 2,197 68,405 - - - 68,405
Board expense - - - 2,607 - 2,607 2,607
Birth Parent expense 20,899 184 183,115 - - - 183,115
Rent 81,357 21,854 481,038 84,891 - 84,891 565,929
Office expense 5,480 6,411 68,338 12,056 - 12,056 80,394
Service fees 466 129 74,970 13,231 - 13,231 88,201
Equipment rental 632 - 72,559 12,805 - 12,805 85,364
Telephone 3,174 2,561 65,916 11,632 - 11,632 77,548
Printing 178 585 8,110 1,430 - 1,430 9,540
Postage 678 3,062 83,503 14,737 - 14,737 98,240
Dues and subscriptions 595 918 9,579 1,690 - 1,690 11,269
Travel 19,572 31,451 206,021 - - - 206,021
Information technology 1,809 543 50,676 8,943 - 8,943 59,619
Staff development 758 5,280 12,983 2,290 - 2,290 15,273
Staff appreciation 356 413 22,443 3,961 - 3,961 26,404
Agency services 1,407 926 10,019 1,768 - 1,768 11,787
Outreach 12,298 4,886 125,895 - 1,272 1,272 127,167
Depreciation - - 19,630 3,464 - 3,464 23,094
Bad debt - - - 48,000 - 48,000 48,000
Total $ 460,930 $ 266,981 $ 5,382,155 $ 767,372 $ 1,272 $ 768,644 $ 6,150,799

See accompanying notes.

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 Independent Adoption Center, Inc.

Notes to Financial Statements

For the year ended December 31, 2014

1. Organization and Summary of Significant Accounting Policies

Organization
Independent Adoption Center, Inc. (IAC) is a California nonprofit public benefit corporation incorporated
on October 27, 1982. IACs primary mission is to offer guidance, education, and counseling in the field of
infertility, reproductive alternatives, and adoption, and to provide full service adoption and foster care
services. Specifically, IAC provides group and private counseling and educational programs to prospective
parents facing infertility problems and considering medical treatments, adoption, or other forms of
reproductive alternatives, and facilitate private adoptions, licensed full-service agency adoption, foster care,
and pre-adoption and post-adoption services.

Basis of Accounting
The accompanying financial statements have been prepared on the accrual basis of accounting in accordance
with accounting principles generally accepted in the United States of America.

Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results could differ from those estimates.

Functional Allocation of Operating Expenses

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

Income Taxes
The Internal Revenue Service and the California Franchise Tax Board have determined that IAC is exempt
from federal and state income taxes under Internal Revenue Code Section 501(c)(3) and the California
Revenue and Taxation Code Section 23701(d). IAC did not have any taxable unrelated business income
during the year ended December 31, 2014.

Cash and Cash Equivalents

Cash consists of checking and savings accounts in large financial institutions. Financial instruments that
potentially subject IAC to concentrations of credit risk include cash and cash equivalents. Cash deposits are
generally federally insured in limited amounts. Cash is stated at fair market value.

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 Independent Adoption Center, Inc.

Notes to Financial Statements (continued)

1. Organization and Summary of Significant Accounting Policies (continued)

Net Assets
IAC reports gifts of cash as restricted support if they are received with donor stipulations that limit the use of
the donated assets. When a donor restriction expires, that is, when a stipulated time restriction ends or
purpose restriction is accomplished, temporarily restricted net assets are reclassified to unrestricted net assets
and reported in the statement of activities and changes in net assets as net assets released from restrictions.

IAC reports information regarding their financial position and activities according to three classifications of
net assets: unrestricted, temporarily restricted, and permanently restricted net assets.

At December 31, 2014, IAC had no temporarily or permanently restricted net assets.

Contributions
All contributions are considered to be available for unrestricted use unless specifically restricted by the donor.
Amounts received that are designated for future periods or are restricted by the donor for specific purposes
are reported as temporarily restricted net support that increase that net asset class. Unconditional promises to
give, which do not state a due date, are presumed to be time-restricted by the donor until received and are
reported as temporarily restricted net assets.

A donor restriction expires when a stipulated time restriction ends, when an unconditional promise with an
implied time restriction is collected, or when a specific purpose restriction is accomplished. Upon expiration,
temporarily restricted net assets are reclassified to unrestricted net assets and are reported in the statement of
activities as net assets released from restrictions. Restricted contributions received in the same year in which
the restrictions are met are reported as unrestricted contributions.

2. Accounts Receivable
Accounts receivable at December 31, 2014 consist of the following:

Amount
Adoption fees $ 1,087,714
Allowance for doubtful accounts (106,400)
Net $ 981,314

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 Independent Adoption Center, Inc.

Notes to Financial Statements (continued)

3. Fixed Assets
IAC follows the practice of capitalizing, at cost, all expenditures for fixed assets with a capitalization
threshold of $500. Donated equipment is recorded at its estimated fair market value. Depreciation is
computed on a straight-line basis over the useful lives of the assets, which ranges from three to ten years.

Fixed assets at December 31, 2014 consist of the following:

Amount
Furniture and equipment $ 123,964
Accumulated depreciation (72,084)
Net $ 51,880

Depreciation expense for the year ended December 31, 2014 was $23,094.

4. Operating Leases
IAC leases office space, parking spaces, and equipment under the following lease agreements:

IAC leases office space at 2300 Clayton Road, Suite 1150, Concord, California for a starting monthly rent of
$17,723. The lease expires on July 31, 2022. The lease expense for the year ended December 31, 2014 was
$220,633.

IAC leases office space at 11030 Raven Ridge Road, Suite 109, Raleigh, North Carolina for a starting
monthly rent of $2,804. The lease expires on July 31, 2015. The lease expense for the year ended December
31, 2014 was $36,149.

IAC leases office space at 5162 E. Stop 11 Road, Suite 1, Indianapolis, Indiana for a monthly rent of $1,380.
The lease expires on March 31, 2018. The lease expense for the year ended December 31, 2014 was $22,440.

IAC leases office space at 2060 East Exchange Place, Suite 140-160, Tucker, Georgia for a starting monthly
rent of $2,801. The lease expires on November 30, 2016. The lease expense for the year ended December 31,
2014 was $36,198.

IAC leases office space at 5050 Quorum Drive, Suite 700, Dallas, Texas for a starting monthly rent of $832.
The lease expires on May 31, 2015. The lease expense for the year ended December 31, 2014 was $10,206.

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 Independent Adoption Center, Inc.

Notes to Financial Statements (continued)

4. Operating Leases (continued)

IAC leases office space at 5555 West Loop South, Suite 308, Bellaire, Texas for a monthly rent of $2,143.
The lease expires on December 31, 2017. The lease expense for the year ended December 31, 2014 was
$26,568.

IAC leases office space at 5050 Quorum Drive, Suite 700, Dallas, Texas for a starting monthly rent of $832.
The lease expires on May 31, 2015. The lease expense for the year ended December 31, 2014 was $10,206.

IAC leases office space at 116 West 23rd Street, Suite 500, Rooms 1, 2, and 3, New York, New York for a
starting monthly rent of $5,768. The lease expires on July 31, 2015

IAC leases two copier/printers from The Swenson Group for a monthly rent of $3,052. The lease expires on
April 30, 2015. The lease expense for the year ended December 31, 2014 was $44,269.

IAC leases other space, copiers, printers, and postage meters from various vendors. The combined lease
expense for the year ended December 31, 2014 was $244,624.

The following is a schedule, by year, of future minimum lease payments at December 31, 2014:

Year Amount

Minimum lease payments 2015 $ 445,043

Minimum lease payments 2016 375,591
Minimum lease payments 2017 351,040
Minimum lease payments 2018 247,989
Minimum lease payments 2019 248,222
Minimum lease payments Thereafter 690,814
$ 2,358,699

5. Subsequent Events
IAC has evaluated all subsequent events through July 3, 2015, the date through which the financial statements
were available to be issued. There were no subsequent events that require recognition or disclosure in the
financial statements.

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