Executive Vice President
- Name: Doug Holland
- Email: [email protected]
- Address: 3517 Fernwood Dr., Raleigh, NC 27612
- Home: (919) 878-5163
- Work: (919) 787-7454
AMA has presented financial statements and supporting schedules giving you an overall view of the accounting information for 2005 compared with 2004. During the next few months, AMA will present the Notes to Financial Statements. Each note is self-explanatory and provides information used by auditors in making decisions regarding opinions and other issues during the audit.
The audit report is available on the AMA Web site in the Members Only section.
Should you have additional questions regarding the information presented, please contact me.
Sometimes you are destined to succeed, but most people succeed because they are determined to succeed.
ABC: Always Be Courteous.
Until later ... Doug Holland
THE ACADEMY OF MODEL AERONAUTICS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Academy of Model Aeronautics, Inc. (the "Academy") was incorporated in 1966 under the laws of the District of Columbia. The Academy’s primary objective is to promote the educational and scientific aspects of model aviation.
Accounting Methods
The Academy maintains its accounts on the accrual basis of accounting and accordingly reflects all significant receivables, payables and other liabilities.
Basis of Accounting
The Academy’s financial statement presentation follows the recommendations of the Financial Accounting Standards Board in its Statement of Financial Accounting Standards (SFAS) No. 117, Financial Statements of Not-For-Profit Organizations. Under SFAS No. 117, the Academy reports 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. The Academy has no permanently restricted net assets.
Financial Estimates
The preparation 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, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Membership Revenue
Memberships are sold on a calendar year basis and revenue is recognized when earned except for life memberships, which are recognized when sold.
Concentration of Credit Risk
Financial instruments that potentially subject the Academy to credit risk consist principally of advertising receivables. In addition, the Academy had funds on deposit with a financial institution in excess of the $100,000 federally insured limit at December 31, 2005 and 2004. The Academy maintains its primary banking and financing relationships with one financial institution.
Property and Equipment
Land, buildings and improvements, and equipment are carried at cost. Expenditures for improvements and replacements are added to the property and equipment accounts. Repairs and maintenance are charged to expense as incurred.
Depreciation is provided over the estimated useful lives of the assets using the straight-line method.
Cash Equivalents
The Academy considers all liquid investments with original maturities of three months or less to be cash equivalents.
Income Taxes
The Academy operates as a nonprofit organization and has received exempt status under Section 501(c)(3) of the Internal Revenue Code. The Academy is, however, subject to unrelated business income tax on magazine advertising, merchandise sales and rental income from debt-financed property. There was no unrelated business income tax expense for the years ended December 31, 2005 and 2004.
Allowance for Doubtful Accounts
The Academy uses the allowance method of accounting to record uncollectible accounts. An allowance is made for possible losses on collection of accounts based on periodic reviews of credit risks. When accounts are determined to be uncollectible, they are charged off against the allowance. Management deems an account to be uncollectible when all collection efforts have failed or the customer is bankrupt. The allowance for doubtful accounts was $3,000 for the years ended December 31, 2005 and 2004.
Transcribed from original scans by AI. Minor OCR errors may remain.
