Southern California Grantmakers

“In june 2017, scg entered into an agreement with the california community foundation (foundation) to create an endowment fund known as the truth, racial healing and transformation fund of los angeles (fund). All monies transferred to the fund are irrevocable gifts to the foundation. Scg is the beneficiary of the fund. According to the fund agreement, ccf holds, manages, invests, and reinvests the fund, collects the income, and makes distributions from the fund. Scg is the sole beneficiary of the fund with distributions being made at least annually. The value of the beneficial interest is based upon the fair value of the assets held in the fund. Annual earnings are recorded as investment income. Adjustments in the value of the beneficial interest are recorded as changes in beneficial interest in agency endownment. The fund was established with a $500,000 contribution received from the kellogg foundation. The fund supports eliminating institutionalized racism using data driven systemic change.”

“Scg is a nonprofit organization under section 501(c)(3) of the internal revenue code and similar provisions for the state of california and, therefore, is exempt from federal and state income taxes. Scg follows asc 740, accounting for income taxes ("asc 740") which provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise's financial statements. Specifically, asc 740-10-25 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Accounting principles generally accepted in the united states of america require management to evaluate tax positions taken by scg and recognize a tax liability (or asset) if scg has taken an uncertain position that more likely than not would not be sustained upon examination by the internal revenue service. Management has analyzed the tax positions taken by scg, and has concluded that as of december 31, 2024 and 2023, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements. Scg is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax period in progress. Management believes it is no longer subject to income tax examinations for years prior to 2022.”