VISIT PLEASANT HILL
(A Not-for-Profit Corporation)
Financial Statements (Cash Basis)
with Independent Auditors’ Report Thereon
Years Ended March 31, 2024 and 2023
TABLE OF CONTENTS
________________________________________________________________ Page No.
Independent Auditors’ Report 1 -3
Statements of Assets, Liabilities and Net Assets 4
Statements of Revenues, Expenses, and Changes in Net Assets 5 Statements of Functional Expenses 6
Notes to Financial Statements 7 - 10
INDEPENDENT AUDITORS’ REPORT
To the Board of Directors of
Visit Pleasant Hill
Pleasant Hill, California
Opinion
We have audited the accompanying financial statements of Visit Pleasant Hill (a not-for-profit corporation), which comprise the statements of assets, liabilities, and net assets (cash basis) as of March 31, 2024 and 2023, and the related statements of revenues, expenses, and changes in net assets and functional expenses (cash basis) for the years then ended, and the related notes to the financial statements.
In our opinion, the financial statements referred to above present fairly, in all material respects, the assets, liabilities, and net assets of Visit Pleasant Hill as of March 31, 2024 and 2023, and the revenues, expenses, and changes in net assets (cash basis) and functional expenses (cash basis) for the years then ended on the basis of accounting described in Note 1 to the financial statements.
Basis for Opinion
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of Visit Pleasant Hill and to meet other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the basis of accounting described in Note 1 to the financial statements and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Visit Pleasant Hill’s ability to continue as a going concern within one year after the date that the financial statements are available to be issued.
Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance but it not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements, including omissions, are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with the basis of accounting described in Note 1 to the financial statements, we:
• Exercise professional judgement and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks.
Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Visit Pleasant Hill’s internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about Visit Pleasant Hill’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audits, significant audit findings, and certain internal control related matters that we identified during the audit.
Basis of Accounting
We draw attention to Note 1 of the financial statements, which describes the basis of accounting.
The financial statements are prepared in accordance with the cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our conclusion is not modified with respect to this matter.
CROPPER ACCOUNTANCY CORPORATION
Walnut Creek, California
October 18, 2024
VISIT PLEASANT HILL
(A Not-for-Profit Corporation)
Statements of Assets, Liabilities, and Net Assets (Cash Basis) March 31, 2024 and 2023
2024 2023
ASSETS
ASSETS:
Cash and cash equivalents $ 261,141 $ 478,887
Prepaid expenses and deposits 14,673 28,155
Capital assets, net 1,827 -
TOTAL ASSETS $ 277,641 $ 507,042
NET ASSETS AND LIABILITIES
NET ASSETS:
Without donor restrictions 277,641 507,042
TOTAL NET ASSETS $ 277,641 $ 507,042
See independent accoountants' report and notes to the financial statements 3 VISIT PLEASANT HILL
(A Not-for-Profit Corporation)
Statements of Revenues, Expenses, and Changes in Net Assets (Cash Basis) Years Ended March 31, 2024 and 2023
2024 2023
SUPPORT AND REVENUES:
Hotel assessments, net of city fees $ 646,826 $ 621,828 Sponsorships 1,000 -
Interest 138 55
Total support and revenues 647,964 621,883
EXPENSES BY FUNCTION:
Program services 728,164 530,580
Management and general 149,201 173,771
Total expenses 877,365 704,351
CHANGE IN NET ASSETS WITHOUT DONOR RESTRICTIONS (229,401) (82,468) NET ASSETS WITHOUT DONOR RESTRICTIONS, BEGINNING OF YEAR 507,042 86,576 Net asset transfers from Pleasant Hill Chamber of Commerce - 502,934 NET ASSETS WITHOUT DONOR RESTRICTIONS, END OF YEAR $ 277,641 $ 507,042 See independent accountants' report and notes to the financial statements 4 VISIT PLEASANT HILL
(A Not-for-Profit Corporation)
Statements of Functional Expenses (Cash Basis)
Years Ended March 31, 2024 and 2023
Program
Services
Management
and General Total
Program
Services
Managemen
t and
General Total
EXPENSES:
Salaries and wages $ 264,599 $ 84,863 $ 349,462 $ 211,831 $ 94,500 $ 306,331 Employee benefits 22,183 7,115 29,298 12,573 5,476 18,049 Payroll taxes 20,784 6,666 27,450 17,299 7,557 24,856
Legal fees - 3,205 3,205 - 46,270 46,270
Accounting - 27,044 27,044 106 15,481 15,587
Other outside services 191,380 9,338 200,718 85,154 1,691 86,845 Marketing and advertising 39,329 - 39,329 71,123 - 71,123 Registration fees and tradeshows 34,019 - 34,019 22,971 - 22,971 Rent - storage 7,781 - 7,781 7,428 - 7,428
Office supplies and related 21,025 6,743 27,768 18,502 119 18,621 Training and development 20,602 - 20,602 17,688 - 17,688 Travel and conferences 32,347 - 32,347 31,165 - 31,165
Memberships 28,448 - 28,448 22,219 - 22,219
Community sponsorships and partnerships 20,682 - 20,682 9,588 - 9,588 Merchandise 12,456 - 12,456
Insurance - 2,575 2,575 - 2,677 2,677
Dues and subscriptions 12,529 - 12,529 2,737 - 2,737
Bank fees - 917 917 160 - 160
Depreciation - 366 366 - - -
Interest - - - 36 - 36
Miscellaneous - 369 369 - - -
Total expenses $ 728,164 $ 149,201 $ 877,365 $ 530,580 $ 173,771 $ 704,351 2024 2023
See independent accountants' report and notes to the financial statements 5 VISIT PLEASANT HILL
(A Not-for-Profit Corporation)
Notes to the Financial Statements
Years ended March 31, 2024 and 2023
_____________________________________________________________________________________ 7 1. DESCRIPTION OF THE ORGANIZATION AND SIGNIFICANT ACCOUNTING
POLICIES
The Organization
Visit Pleasant Hill is a California nonprofit mutual benefit corporation established to promote tourism through the operation of the Pleasant Hill Tourism Improvement District (PHTID) and other related programs and initiatives according to Property and Business Improvement District Law of 1994, Street and Highways Code 36600 et seq., (The 1994 Law) and the PHTID Management District Plan.
Pursuant to The 1994 Law, the City of Pleasant Hill is authorized to levy and collect assessments from lodging businesses in the PHTID for the purposes outlined above and has contracted with Visit Pleasant Hill, to serve as the Owners’ Association for the PHTID. As such, Visit Pleasant Hill’s primary source of revenue are hotel assessments received from seven hotels within the PHTID. Any significant change in Pleasant Hill hotel occupancy has a significant effect upon Visit Pleasant Hill’s programs and operations.
Basis of Accounting
The accompanying financial statements have been prepared on the cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America.
Under the cash basis of accounting used by Visit Pleasant Hill, revenues are not recorded until received and expenses are not recorded until paid. Accordingly, the following are not reflected in the accompanying financial statements according to organization policy:
Accounts receivable
Accounts payable
Accrued expenses such as accrued vacation
Deferred revenue
Lease assets and liabilities
Basis of Presentation
The financial statements of Visit Pleasant Hill have been prepared in accordance with ASU 2016- 14, which require nonprofit organizations to report information regarding its financial position and activities according to the following net asset categories:
Net assets without donor restrictions: Net assets that are not subject to donor-imposed restrictions and may be expended for any purpose in performing the primary objectives of the organization. These net assets may be used at the discretion of Visit Pleasant Hill’s management and board of directors.
VISIT PLEASANT HILL
(A Not-for-Profit Corporation)
Notes to the Financial Statements
Years ended March 31, 2024 and 2023
_____________________________________________________________________________________ 8 Net assets with donor restrictions: Net assets subject to stipulations imposed by donors and grantors. Some donor restrictions are temporary in nature; those restrictions will be met by actions of Visit Pleasant Hill or by the passage of time. Other donor restrictions are perpetual in nature, whereby the donor has stipulated the funds be maintained in perpetuity.
Donor restrictions are reported as increases in net assets with donor restrictions. When a restriction expires, net assets are reclassified from net assets with donor restrictions to net assets without donor restrictions in the statements of activities.
Cash and Cash Equivalents
Visit Pleasant Hill considers money market funds and highly liquid investments with a maturity of three months or less when acquired, to be cash equivalents.
Concentrations of Credit Risk
As of March 31, 2024, Visit Pleasant Hill maintains its cash and equivalents in two financial institutions. At times, amounts on deposit may exceed insured limits ($250,000 per financial institution by the FDIC) or include uninsured investments in money market mutual funds. To date, the Association has not experienced credit losses in any of these accounts.
Capital Assets
Capital assets with a cost basis in excess of $3,000 are capitalized and stated at cost in the accompanying financial statements. Donated capital assets are reported at the estimated fair value on the date contributed.
Costs incurred in the development of internal use software (including website development costs) for operating purposes are capitalized as incurred, including design, coding, testing, and implementation costs after feasibility has been achieved. Other related costs, such as project scoping, feasibility determination, and post-implementation support, are expensed as incurred.
Certain other software development costs not meeting the capitalization criteria per generally accepted accounting standards, such as proof-of-concept software development activities or software development costs incurred in a functional component project (the coding resulting from such a project is available and beneficial to the industry as a whole) are expensed as incurred.
Normal repairs and maintenance, including website maintenance, computer hardware replacement parts or computer software upgrades, are expensed as incurred.
Depreciation and amortization is computed on the straight-line method over estimated useful lives as follows:
Computer hardware and software 3 years
Furniture and other equipment 5 years
Website development costs 4 years
VISIT PLEASANT HILL
(A Not-for-Profit Corporation)
Notes to the Financial Statements
Years ended March 31, 2024 and 2023
_____________________________________________________________________________________ 9 Revenue Recognition
Hotel assessments and other revenues are recorded upon receipt. Such assessments are received net of processing fees charged by the City of Pleasant Hill of $13,201 and $10,350, respectively.
Operating Expenses
Operating expenses are recorded upon disbursement. As of March 31, 2024 and 2023, all costs disbursed pertaining to future fiscal years are recorded as prepaid expenses and deposits.
Functional Allocation of Expenses
The costs of providing Visit Pleasant Hill’s various programs and supporting services have been summarized on a functional basis in the statement of revenues, expenses, and changes in net assets.
Accordingly, certain costs have been allocated among the programs and supporting services benefited based upon management estimates.
Tax-Exempt Status
Visit Pleasant Hill is exempt from income tax under IRC section 501(c)(6), though it is subject to tax on income unrelated to its exempt purpose, unless that income is otherwise excluded by the Code. Visit Pleasant Hill has processes presently in place to ensure the maintenance of its taxexempt status; to identify and report unrelated income; to determine its filing and tax obligations in jurisdictions for which it has nexus; and to identify and evaluate other matters that may be considered tax positions. Tax years including the tax year ended March 31, 2024 and earlier are subject to examinations by tax authorities. Visit Pleasant Hill has determined that there are no material uncertain tax positions that require recognition or disclosure in the financial statements.
Use of Estimates
The preparation of financial statements in conformity with the cash basis of accounting requires management to make estimates and assumptions that affect the reported amounts of assets at the dates of the financial statements and the reported amounts of expenses during the reporting periods.
Actual results could differ from those estimates. The allocation of costs among functions is based on an allocation method using management’s best estimates of time spent on the various functions.
Subsequent Events
Management has evaluated subsequent events through October 18, 2024, the date on which the financial statements were available to be issued. Based on that evaluation, no additional adjustments to or disclosures in these financial statements were deemed necessary.
2. LEASE COMMITMENTS
Visit Pleasant Hill operates a virtual office with one month-to-month lease for storage.
VISIT PLEASANT HILL
(A Not-for-Profit Corporation)
Notes to the Financial Statements
Years ended March 31, 2024 and 2023
_____________________________________________________________________________________ 10 3. AVAILABILITY AND LIQUIDITY
The following represents Visit Pleasant Hill’s financial assets as of March 31, 2024 and 2023:
2024 2023
Financial assets at year-end:
Cash and cash equivalents $ 261,141 $ 478,887
Less amounts not available to be used within one year:
Operating reserve or donor restricted net assets - -
Financial assets available to meet general expenditures over the next twelve months $ 261,141 $ 478,887
Visit Pleasant Hill is in the process of developing a liquidity plan, so that excess cash is set aside to meet future cash needs if operating cash flow were to fluctuate significantly.
4. RELATED PARTY TRANSACTIONS
The Board of Directors of Visit Pleasant Hill is comprised of representatives of five local hotels in addition to a representative from the City of Pleasant Hill and a representative from Pleasant Hill Chamber of Commerce.
Visit Pleasant Hill’s primary source of revenue are hotel assessments received from hotels within the Pleasant Hill Tourism Improvement District. Those assessments are forwarded to the City of Pleasant Hill who reviews and approves the respective assessment calculations for propriety prior to forwarding funds to Visit Pleasant Hill, net of processing fees of $13,201 and 10,350, respectively, for such services.
The following summarizes related party transactions during the years ended March 31, 2024 and 2023:
2024 2023
Amounts paid to:
City of Pleasant Hill, excluding processing fees
Pleasant Hill Chamber of Commerce
Hyatt House Pleasant Hill
Homewood Suites by Hilton Pleasant Hill
Sonesta Pleasant Hill
Residence Inn by Marriott, Pleasant Hill
$ 3,250
$ 9,000
$ 1,088
$ 203
$ 802
$ 675
$43,800
$ 4,000
$ 788
$ 931
$ 614
$ 495