Indian Creek Caring Foundation

“The board of directors has established an endowment fund for the support of the organization's mission over the long term. As required by generally accepted accounting principles, net assets associated with endowment funds, including funds designated by the board of directors, are classified and reported based on the existence or absence of donor-imposed restrictions. Net assets designated by the board for endowment, including any unrestricted accumulated earnings arising from donor restricted contributions, are classified and reported as unrestricted net assets. The board of directors has interpreted the commonwealth of pennsylvania law as requiring the preservation of the fair value of the original gift as of the gift date of the donor-restricted endowment funds absent explicit donor stipulations to the contrary. As a result of this interpretation, the caring foundation 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. Absent specific donor restrictions beyond the preservation of principal, the permanently restricted endowment funds are governed by the same guidelines as the board designated portion of the fund. The remaining portion of the donor-restricted endowment fund that is not classified as permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the organization. The caring foundation considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds: (1) the duration and preservation of the various funds, (2) the purposes of the donor-restricted endowment funds, (3) general economic conditions, (4) the possible effect of inflation and deflation, (5) the expected total return from income and the appreciation of investments, (6) other resources of the organization, and (7) the organization's investment policies. The caring foundation has no temporarily restricted endowment net assets. The caring foundation has a discretionary spending policy of appropriating for distribution each year 3% of the arithmetic mean (average) of the market value of the fund for the previous three fiscal years. However, no withdrawals shall be made prior to the fund reaching 1,000,000. In establishing this policy, the caring foundation considered the long-term expected investment return on its endowment. Accordingly, over the long term, the caring foundation expects the current spending policy to allow its endowment fund to grow at an average of inflation plus 3%. This is consistent with the caring foundation's objectives of providing current programs with a predictable, stable stream of revenues, ensuring that the purchasing power of this revenue stream does not decline over time, and ensuring that the purchasing power or real value of the endowment does not decline over time. To achieve these objectives, the caring foundation has adopted an investment policy that attempts to preserve the real purchasing power of the principal and provide a stable source of perpetual financial support. Endowment assets are invested in a broadly diversified portfolio, including equity and debt securities, which are intended to achieve the return objectives of inflation plus 3%. Actual returns in any given year may vary from this amount. Investment risk should be within prudent limits but adequate to allow for the attainment of the rate of return objective.”

“The caring foundation was formed in 2012 as a non-profit corporation as described in section 501(c)(3) of the internal revenue code and in 2014 received its exemption from federal income taxes as a type ii supporting organization pursuant to section 509(a)3 of the internal revenue code in 2014. The caring foundation is also exempt from pennsylvania taxation under the applicable provisions of the commonwealth's non-profit organization statutes. The organization utilizes accounting standards codification 740-10, accounting for uncertainty in income taxes, as it relates to uncertain tax positions. Management has reviewed its current and past federal and state tax positions and has determined that the tax positions taken are certain and there is no likelihood that a material tax assessment would be made if the respective government agencies examined tax returns subject to audit. Accordingly, no provision for the effect of uncertain tax positions has been recorded, nor have any related interest and penalties been accrued.”