California Historical Society

“CollectionsInexhaustible collections include research books, manuscripts, photographs, art objects, and other items of historical significance which have been donated to the Society. In conformity with the practice followed by many similar organizations and in accordance with ASC 958.360.25-3, Property, Plant and Equipment (including Collections) of Not-for-Profit Entities, the Society does not capitalize its collection materials. ASC 958.360.25-3 precludes the capitalization of such items if collections are: (1) held for public exhibition, education, or research in furtherance of public service rather than financial gain, (2) protected, kept unencumbered, cared for, and preserved, and (3) subject to an organizational policy that requires the proceeds from sales of collection items to be used to acquire other items for collections.”

“Collection Sharing AgreementDuring the year ended June 30, 2007, the Society and the Autry National Center ("Autry") entered into a Non-Profit Joint Venture and Collection Sharing Agreement (the "Agreement"). This collection sharing arrangement inaugurated a long-term presence of the Society and its collection into Southern California and enhances the long-term plans of the Society to improve its facility and operations in Northern California while permitting Autry to display historic pieces of the Society's collection. The initial collection sharing involves 68 "paintings and the California Historic Costume Collection.”

“Endowment funds, classified as permanently restricted net assets on the Foundation's books, represent donor contributions that are subject to restrictions of gift instruments requiring that the principal be invested in perpetuity. Earnings from investments may be used for general operating purposes of each program and transferred to unrestricted net assets through an appropriation process under UPMIFA guidelines. Such transfers may be used for general operating purposes in accordance with ASC 958.320.”

“Income TaxesFinancial statement presentation follows the recommendations of ASC 740, Income Taxes. Under ASC 740, the Society is required to report information regarding its exposure to various tax positions taken by the Society and requires a two-step process that separates recognition from measurement. The first step is determining whether a tax position has met the recognition threshold; the second step is measuring a tax position that meets the recognition threshold. Management believes that it has adequately evaluated its current tax positions and has concluded that as of June 30, 2025, the Society does not have any uncertain tax positions for which a reserve or an accrual for a tax liability would be necessary.The Society has received notification from the Internal Revenue Service and the State of California that it qualifies for tax-exempt status under Section 501(c)(3) of the Internal Revenue Code and Section 27301d of the California Revenue and Taxation Code. This exemption is subject to periodic review by the federal and state taxing authorities and management is confident that the Society continues to satisfy all federal and state statutes in order to qualify for continued tax exemption status. The Society may periodically receive unrelated business income (such as advertising revenue) requiring the Society to file separate tax returns under federal and state statutes. Under such conditions, The Society calculates and accrues the applicable taxes payable.”