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CHILD CARE RESOURCE CENTER, INC. (A NONPROFIT ORGANIZATION)
NOTES TO FINANCIAL STATEMENTS June 30, 2015
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Revenue and Support (Continued)
Contributions of donated non-cash assets are recorded at their fair values in the period in which they are received. Contributions of donated services that create or enhance nonfinancial assets or that require specialized skills are provided by individuals possessing those skills and would typically need to be purchased if not provided by donation are recorded at their fair values in the period in which they are received. CCRC received professional services relating to the Head Start Program valued at $129,806 and $98,414 for the years ended June 30, 2015 and 2014, respectively.
Fees for Services Revenue
CCRC receives support from the Los Angeles County Department of Public Social Services (“DPSS”) under the CalWORKs welfare-to-work program. CCRC receives reimbursements for payments to providers and an administrative fee per family served per month under this program. Amounts received under this program are reflected as “fees for services” in the accompanying statements of activities.
Functional Allocation of Expenses
Expenses that can be identified with a specific program or supporting service are charged directly to the related program or supporting service. Expenses that are associated with more than one program or supporting service are allocated based on an evaluation by management. Fundraising costs of $59,441 and $42,802 for the years ended June 30, 2015 and 2014, respectively, were not charged to any child development contracts.
Estimated Fair Value of Financial Statements
As defined in FASB ASC Topic No. 820, “Fair Value Measurements and Disclosures” (“ASC 820”) (formerly SFAS No. 157, “Fair Value Measurements”), fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the CCRC uses the market or income approach. Based on this approach, CCRC utilizes certain assumptions about risk and/or the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated or generally unobservable inputs. CCRC utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.
Based on the observability of the inputs used in the valuation techniques, CCRC is required to provide the following information according to the fair value hierarchy. The fair value hierarchy ranks the quality and the reliability of the information used to determine fair values.
As a basis for considering such assumptions, ASC 820 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:
Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets
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