San Francisco Day School

“The school's endowment consists of 20 distinctly named endowments established for a variety of purposes, some of which include donor-restricted funds. The endowment includes donor-restricted endowment funds. As required by u.s. Gaap, net assets associated with endowment funds, including funds designated by the board of trustees to function as endowments, are classified and reported based on the existence or absence of donor-imposed restrictions. Interpretation of revelant law: the board of trustees has been advised by our audit firm to interpret prudent management of investment funds act (upmifa) as requiring the preservation of the fair value of the original gift as of the gift date, absent explicit donor stipulations to the contrary. As a result of this interpretation, 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 upmifa. In accordance with upmifa, the school considered the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds: (1) the duration and preservation of the fund (2) the purposes of the school and the donor-restricted endowment fund (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 school (7) the investment policies of the school return objectives and risk parameters: the school has adopted investment and spending policies for endowment assets that attempt to provide a predictable stream of funding to programs supported by its endowment while seeking to maintain the purchasing power of the endowment assets. Endowment assets include those assets of donor-restricted funds that the school must hold in perpetuity or for a donor-specified periods(s) as well board-designated funds. The school aspires its endowment funds, over time, to provide a moderate rate of return, consistent with the investment policy. Strategies employed for achieving objectives: to satisfy its long-term rate-of-return objectives, the school relies on a total return strategy in which investment returns are achieved through both capital appreciation (realized and unrealized) and current yield (interest and dividends). The school targets a diversified asset allocation that places a greater emphasis on equity-based investment to achieve its long-term return objectives within prudent risk constrats. Spending policy and how the investment objectives relate to spending policy: the school has a policy of appropriating for distribution each year 4.50% of its endowment fund's average fair value over the prior twelve quarters. On individual endowment funds where the fair value has decreased below cost, the school's policy is to distribute only investment earnings. In establishing this policy, the school considers the long-term expected return on its endowment. Over the long-term, the school expects the current spending policy to allow its endowment to maintain and grow real purchasing power over long time horizons consistent with the investment policy, while recognizing the challenges of meeting this goal in the current investment environment.”

“Income taxes the school is a qualified organization exempt from federal and state income taxes under section 501(c)(3) of the internal revenue code (irc) and section 23701d of the california revenue and taxation code, respectively. Accordingly, it is exempt from federal and california income taxes and is not liable for federal unemployment taxes. Management evaluated the school's tax positions and concluded that they maintained their tax exempt status and had taken no uncertain tax positions that would require adjustment to the consolidated financial statements. Therefore, no provision or liability for income taxes has been included in the consolidated financial statements. The school is subject to routine audits by taxing jurisdictions; however, there are no audits in process.”

“Financial aid 1,641,742. Aftercare expenses, shown net on financial statements 529,366.”

“Financial aid 1,641,742. Aftercare expenses, shown net on financial statements 529,366.”