Animals Asia Foundation Limited
Financial Statements &
Independent Auditor’s Report
for the Year Ended
December 31, 2020
TABLE OF CONTENTS
INDEPENDENT AUDITOR'S REPORT ...........................................................................3
FINANCIAL STATEMENTS .............................................................................................5
Statement of Financial Position ...........................................................................................5
Statement of Activities and Changes in Net Assets .............................................................6
Statement of Functional Expenses .......................................................................................7
Statement of Cash Flows .....................................................................................................8
Notes to Financial Statements ..............................................................................................9
388 Market Street, Suite 1300, San Francisco, CA 94111
Toll Free: (855) 676-2727 Fax: (855) 568-8895
www.cook.cpa
Independent Auditor's Report
To the Board of Directors
Animals Asia Foundation Limited
Los Angeles, California
We have audited the accompanying financial statements of Animals Asia Foundation Limited (a nonprofit
organization), which comprise the statement of financial position as of December 31, 2020, the related
statements of activities and changes in net assets, functional expenses, and cash flows for the year then
ended, and the related notes to the financial statements.
Management’s 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.
Auditor’s 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 auditor’s judgment, including an
assessment of the risks of the 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 entity’s
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 entity’s 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 statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
(continued on next page)
4
(continued from previous page)
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the
financial position of Animals Asia Foundation Limited, as of December 31, 2020, 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.
Report on Summarized Comparative Information
We have previously audited the December 31, 2019, financial statements of Animals Asia Foundation
Limited and our report dated October 27, 2020, expressed an unmodified opinion on those audited
financial statements. In our opinion, the summarized comparative information presented herein as of and
for the year ended December 31, 2019, is consistent, in all material respects, with the audited financial
statements from which it has been derived.
A Professional Accountancy Corporation
San Francisco, California
October 7, 2021
12/31/19
12/31/20 (Note 2)
ASSETS
Current Assets:
Cash & equivalents 1,342,354$ 896,426$
Contributions receivable (Note 3) 87,119 111,683
Prepaid expenses & deposits 13,678 12,506
Total current assets 1,443,151 1,020,615
Property & equipment, net (Note 4) 2,396 1,979
TOTAL ASSETS 1,445,547$ 1,022,594$
LIABILITIES & NET ASSETS
Current Liabilities:
Accounts payable & accrued expenses 54,626$ 91,282$
Accrued vacation pay 11,617 22,734
TOTAL LIABILITIES 66,243 114,016
Net Assets
Without donor restrictions 1,227,801 788,217
With donor restrictions (Note 5) 151,503 120,361
TOTAL NET ASSETS 1,379,304 908,578
TOTAL LIABILITIES & NET ASSETS 1,445,547$ 1,022,594$
Animals Asia
with Comparative Totals for December 31, 2019
December 31, 2020
Statement of Financial Position
See accompanying notes to financial statements
and independent auditor's report.
5
Animals Asia
Statement of Activities and Changes in Net Assets
for the Year Ended December 31, 2020
with Comparative Totals for the Year Ended December 31, 2019
See accompanying notes to financial statements
and independent auditor's report.
6
2019
Program Management 2020 Total
Services & General Fundraising Total (Note 2)
Salaries 70,164$ 72,595$ 127,527$ 270,286$ 286,978$
Payroll taxes 5,554 5,278 8,377 19,209 23,354
Employee benefits 268 287 499 1,054 22,894
Recruitment - 15,186 - 15,186 -
Grants made 1,417,197 - - 1,417,197 918,325
Professional fees 6,294 37,974 - 44,268 75,645
Contributed services (Note 6) 101,495 100,528 22,503 224,526 235,577
Occupancy 11,409 6,519 14,669 32,597 16,635
Office supplies & small equipment 9,077 2,345 5,652 17,074 12,570
Postage 6,205 1,732 3,756 11,693 15,199
Insurance 860 922 1,600 3,382 3,689
Travel 6,923 542 8,496 15,961 24,071
Advertising & promotions 136,335 3,408 132,886 272,629 177,781
Bank fees - 1,468 59,125 60,593 29,439
Depreciation 268 287 498 1,053 1,554
Miscellaneous expense 2,334 1,002 - 3,336 1,495
Total Expenses 1,774,383$ 250,073$ 385,588$ 2,410,044$ 1,845,206$
Animals Asia
Statement of Functional Expenses
for the Year Ended December 31, 2020
with Comparative Totals for the Year Ended December 31, 2019
See accompanying notes to financial statements
and independent auditor's report.
7
2020 2019
Cash flows from operating activities:
Cash received from grantors/contributors 2,680,249$ 1,863,391$
Cash received from other sources 559 1,247
Cash generated from operating activities 2,680,808 1,864,638
Cash paid to, or for the benefit of, employees (301,666) (331,584)
Cash grants paid (1,417,197) (918,325)
Cash paid to contractors and suppliers (514,547) (318,026)
Cash disbursed for operating activities (2,233,410) (1,567,935)
Net cash flows generated from operating activities 447,398 296,703
Cash flows from investing activities:
Purchases of fixed assets (1,470) -
Net cash flows from investing activities (1,470) -
NET CHANGE IN CASH 445,928 296,703
CASH & CASH EQUIVALENTS, beginning of year 896,426 599,723
CASH & CASH EQUIVALENTS, end of year 1,342,354$ 896,426$
Supplemental information:
Reconciliation of change in net assets to cash flows generated from operating activities:
Change in net assets 470,726$ 218,891$
Adjustments to reconcile change in net assets to net cash
from (used for) operating activities
Depreciation expense 1,053 1,554
Changes in assets and liabilities:
Contributions receivable 24,564 36,118
Prepaid expenses and other current assets (1,172) (7,702)
Accounts payable (36,656) 46,200
Accrued vacation (11,117) 1,642
Net cash flows generated from operating activities 447,398$ 296,703$
Animals Asia
Statement of Cash Flows
for the Year Ended December 31, 2020
with Comparative Totals for the Year Ended December 31, 2019
See accompanying notes to financial statements
and independent auditor's report.
8
Animals Asia Foundation Limited
Notes to the Financial Statements
for the Year Ended December 31, 2020
9
1. The Organization
Nature of Activities
Animals Asia Foundation Limited (the Organization), a nonprofit corporation headquartered in Los
Angeles, California, is the independent U.S. affiliate of Animals Asia, an international animal welfare
organization.
Founded in 1998 by Jill Robinson, from her home in Hong Kong, Animals Asia promotes compassion
and respect for all animals and works to bring about long-term change. The Organization works to end
the barbaric bear bile trade in China and Vietnam. Animals Asia also works to end the trade in dogs and
cats for food in China and Vietnam, and lobbies to improve the welfare of companion animals, promote
humane population management and prevent the cross-border export of "meat dogs" in Asia.
In addition, Animals Asia campaigns for an end to abusive animal practices in zoos and safari parks in
Asia, and works closely with governing authorities to improve animal management and increase
awareness of the welfare needs of captive animals.
As a grantmaking foundation, the Organization fulfills its mission primarily through the provision of
charitable grants to program partners abroad.
2. Summary of Significant Accounting Policies
Basis of Accounting
The accompanying financial statements are prepared on the accrual basis of accounting, in accordance
with accounting principles generally accepted in the United States of America. Under the accrual basis of
accounting, support is recognized when it is awarded, revenue is recognized when it is earned and
realizable, and expenses are recognized when they are incurred.
Cash & Cash Equivalents
The balance of cash and equivalents primarily includes deposits held in bank checking and savings
accounts.
Contributions Receivable
Contributions receivable are reported at the amount management expects to collect on balances
outstanding at year-end. Based on management’s judgment, an allowance for doubtful accounts has been
recorded. Since all amounts are due within one year of the balance sheet, a present value discount has not
been recorded.
Fair Value of Financial Instruments
The carrying amounts of cash, receivables, and accounts payable approximate fair value because of the
short maturity of these instruments.
Property & Equipment
Capitalized purchases of assets (consisting primarily of office furnishings and equipment with an initial
cost of at least $500) are depreciated on a straight-line basis over a period of three years.
Net Assets
Net assets, revenues, expenses, gains, and losses are classified based upon the existence or absence of
donor-imposed restrictions. Accordingly, net assets of the Organization and changes therein are classified
and reported as follows:
Animals Asia Foundation Limited
Notes to the Financial Statements
for the Year Ended December 31, 2020
10
Net assets without donor restrictions, which includes resources not subject to, or no longer
subject to, donor-imposed stipulations.
Net assets with donor restrictions, which includes resources whose use is limited by donor-
imposed time and/or purpose restrictions.
Recognition of Contributions
The Organization recognizes contributions when it receives cash, securities or other assets, an
unconditional promise to give, or notification of a beneficial interest.
Contributions are reported as increases in net assets without donor restrictions unless use of the
contributed assets is limited by donor-imposed stipulations. Gains and losses on investments and other
assets or liabilities are reported as increases or decreases in net assets without donor restrictions unless
they are encumbered by explicit donor stipulation or by law. Expirations of donor-restrictions (i.e. the
donor-stipulated purpose has been fulfilled and/or the stipulated time-period has elapsed) are reported as
reclassifications between the applicable classes of net assets.
Conditional promises to give, that is, those with a measurable performance or other barrier, and a right of
return, are not recognized until the conditions on which they depend have been substantially met.
Recognition of PPP Loan
In connection with economic uncertainties resulting from the Coronavirus pandemic, the Organization
applied for and received a forgivable loan through the U.S. Small Business Administration’s Paycheck
Protection Program (PPP). Nonprofit organizations have the option of treating the funding from this
program as a conditional government grant in accordance with ASC 958 or as debt in accordance with
ASC 470. Because the Organization has elected the former method, the total proceeds are recognized
within the government grants revenue category on the statement of activities. (The loan amount was
subsequently forgiven in full on August 6, 2021.)
Contributed Services
In order to accomplish its mission, Animals Asia relies heavily on contributed professional services
received from its international affiliate in Hong Kong. In accordance with generally accepted accounting
principles, the Organization records the estimated fair market value of these services in the statement of
activities and changes in net assets based on the assumption the services would need to be purchased had
they not been contributed to the Organization. Due to the fact that certain assumptions must be made
when calculating and recording estimates, it is at least reasonably possible that the actual value of services
received differs from the amount recorded in the financial statements.
Functional Expenses
The Organization presents its expenses by function and natural category. Program services include the
direct conduct and direct supervision of specific program activities. Fundraising includes efforts to
solicit monetary and nonmonetary contributions. Management & general includes general oversight,
recordkeeping, regulatory compliance, governance, financial management, and all other activities that do
not constitute the direct conduct or direct supervision of specific program services or fundraising
activities.
At year-end, the Organization allocates each employee’s compensation to the major functions according
to management’s estimate of that individual’s time and effort (based on job titles and major
responsibilities). Other shared costs, consisting primarily of occupancy and office expenses, are then
allocated according to each major function’s proportionate share of salaries expense.
Animals Asia Foundation Limited
Notes to the Financial Statements
for the Year Ended December 31, 2020
11
Advertising Costs
The Organization uses advertising to promote its programs among the audiences it serves. All advertising
costs are expensed as incurred.
Income Taxes
As a public charity, the Organization is exempt from income taxes under Internal Revenue Code Section
501(c)(3), except on activities unrelated to its mission. Since management believes that all of the
Organization’s activities are directly related to its mission, no provision has been made for income tax
expense. The Organization’s federal Return of Organization Exempt from Income Tax (Form 990) filings
for the tax years ending in 2018 through 2020 are subject to examination by the Internal Revenue Service,
generally for three years after they were filed. The Organization’s California Exempt Organization
Annual Information Return (Form 199) filings for the tax years ending in 2017 through 2020 are subject
to examination by the Franchise Tax Board, generally for four years after they were filed.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those estimates.
Comparative Data
The financial statement information for the year ended December 31, 2019, presented for comparative
purposes, is not intended to be a complete financial statement presentation. For a complete presentation,
please refer to the financial statements for that fiscal year.
3. Contributions Receivable
Contributions receivable (due within 12 months) $89,716
Less: allowance for uncollectible amounts (2,597)
Contributions receivable, net $87,119
4. Property & Equipment
Furnishings & equipment $14,780
Less: accumulated depreciation (12,384)
Property & equipment, net $2,396
5. Net Assets with Donor Restrictions
The balance of net assets with donor restrictions represents amounts designated for the following:
To support a new veterinary hospital $40,000
Animal-welfare education project in China 31,073
Development of a comprehensive plan
to end bear bile farming 30,000
For hiring a farm animal welfare coordinator 26,200
Other activities 24,230
Total $151,503
Animals Asia Foundation Limited
Notes to the Financial Statements
for the Year Ended December 31, 2020
12
6. Contributed Services
Management, information technology,
human resources and finance $100,529
Program support 73,181
Marketing 45,006
CRM systems 5,810
Total $224,526
7. Co-working Facility Service Agreement
The Organization occupies space in a co-working facility in Los Angeles for a monthly fee of $2,318. As
of December 31, 2020, the agreement was on a month-to-month basis. (Subsequent to year-end, the
Organization renewed the agreement at the same rate for a period of 12 months.)
8. Contractual Commitments
As of December 31, 2020, the Organization has entered a contract for telemarketing fundraising service
for approximately $71,000.
9. Contingencies, Risks & Uncertainties
COVID-19
As a result of the spread of the COVID-19 coronavirus, economic uncertainties have arisen which may
impact the Organization’s ability to conduct program activities or raise contributions. While the
disruption is currently expected to be temporary, there is considerable uncertainty around the duration.
As such, the financial impact of this situation cannot be reasonably estimated at this time.
Satisfaction of Donor Requirements
The Organization receives contributions that are restricted for a specific program or purpose. If such
restrictions are not met in accordance with the funding source agreement, there is the possibility that
funds would have to be returned to the donor. It is management's opinion that all donor restrictions have
been satisfied for grants and contributions that have either been released from restriction or recorded
directly to net assets without donor restrictions.
Cash Deposits in Excess of FDIC Insurance Limits
The Organization maintains substantially all of its cash deposits with one financial institution. Such
amounts may at times exceed Federal Deposit Insurance Corporation limits, however, management
believes the risk of loss is minimal. To date, the Organization has not experienced any losses in these
accounts.
10. Management’s Liquidity Disclosure
The Organization regularly monitors liquidity required to meet its operating needs and other contractual
commitments.
Animals Asia Foundation Limited
Notes to the Financial Statements
for the Year Ended December 31, 2020
13
For purposes of analyzing resources available to meet general expenditures over a 3-month period, the
organization considers all expenditures related to its ongoing activities as well as the expenditures needed
for general operations.
In addition to financial assets available to meet general expenditures (excluding grants), the organization
operates with a balanced budget and anticipates collecting sufficient revenue to cover general
expenditures. Cash flows have seasonal variations during the year attributable to four quarterly appeals,
and a concentration of contributions received near calendar year-end. Refer to the statement of cash flows
which identifies the sources and uses of the Organization’s cash and shows positive cash generate by
operations for fiscal year 2020.
As of December 31, 2020, the following table shows the total financial assets held by the Organization
and the amounts of those financial assets could readily be made available within one year of the balance
sheet date to meet general expenditures:
Cash & equivalents $1,342,354
Contributions receivable 87,119
Less: net assets with donor restrictions (151,503)
Total $1,277,970
11. Subsequent Events – Financial Statement Presentation
In preparing these financial statements, the Organization has evaluated events and transactions for
potential recognition or disclosure through October 7, 2021, which is the date the financial statements
were available to be issued.