Bancroft School

“The school's endowment consists of numerous individual donor restricted funds established for a variety of purposes. As required by generally accepted accounting principles, net assets associated with endowment funds are classified and reported based on the existence or absence of donor-imposed or legal restrictions. Endowment funds include invested gifts and assets of pooled income funds for endowment purposes. As required by generally accepted accounting principles, the school classifies as permanently restricted net assets (a) the original value of gifts donated to the permanent endowment, (b) the original value of subsequent gifts to the permanent endowment, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. The remaining portion of the donor-restricted endowment fund that is not classified in permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the school in a manner consistent with the standard of prudence prescribed by state law. In accordande with upmifa, the school can consider the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds: - the duration and preservation of the fund - the purposes of the school and the donor-restricted endowment fund - general economic conditions - the possible effect of inflation and deflation - the expected total return from income and the appreciation of investments - other resources of the school - the investment policies of the school. The school has adopted investment and spending policies for its endowment assets that attempt to provide a predictable stream of funding for its programs while seeking to maintain the purchasing power of the endowment assets. Under this policy, as approved by the board, the school's finance committee shall seek to invest the endowment funds in such a manner that the investments will provide a spendable return consistent with a long-term goal of preserving the funds in real terms. Actual returns in any given year may vary from this amount. To satisfy its long-term rate-of-return objectives, the school relies on a strategy which emphasizes total return through both capital appreciation (realized and unrealized) and current yield (interest and dividends). Specifically, the primary objective in management of the endowment is maintaining liquidity and long-term capital growth, while preserving the purchasing power of the endowment. The school has invested in mutual funds, equity securities, and an alternative investment that target a diversified asset allocation that places a greater emphasis on equity-based investments to achieve these objectives within prudent risk constraints. The board of trustees adopted a policy of transferring up to 4% of the market value of investments to operations based upon a five year rolling average of all investments. The transfer includes interest and dividend income earned on such investments for use in the general operating activities of the school. To the extent that investment income does not provide this level of support, net investment appreciation is appropriated for operations. In establishing this policy, the school considered the long-term expected return on its endowment. This is consistent with the school's objective to maintain the purchasing power of its endowment. From time to time, the fair value of assets associated with individual donor-restricted endowment funds may fall below the level that the donor imposed restrictions require the school to retain as a fund of perpetual duration. In accordance with generally accepted accounting principles, deficiencies of this nature are reported in unrestricted net assets. There were no such deficiencies noted as of june 30, 2016 or 2015.”

“Management annually reviews for uncertain tax positions that would have a material adverse effect, individually or in the aggregate upon the school's statements of financial position, or the related statements of activities, or cash flows.”

“Change in value of assets of pooled income funds 13,298. Change in fair value of beneficial interest in remainder trust 1,886. Change in value of hedging instrument 294,671. Bookstore cost of good sold 35,676. Fundraising expenses 6,920.”

“Bookstore cost of goods sold 35,676. Fundraising expenses 6,920.”