WRFC Financial Report 2011 and 2010 WILMINGTON REGIONAL
FILM COMMISSION, INC,
Financial Statements
June 3, 2011 and 20 10
WILMINGTON REGIONAL FILM COMMISSION, INC.
Table of Contents
June 30 2011 and 201
Independent Auditors' Report
Statement of Financial Position
Statement of Activities and Changes 1 N et A sse ts
Statement of Functional Expenses
S tatement of Cash Flows
Notes to Financial Statements -9
Supplemental Information
Budget to Actual Comparison of Support, Revenue and Expenses � �
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Cl ement Goodson, CPA 77 S D err l ire.
Lynn Saylor, CPA lnde Inde pendent Au �tors' Wilmington, C 23403
Voice 9
Fax 9
To The Board of Directors of
Wilmington Re g Tonal Film Comm*ss�on, Inc.
rd
1223 North 23 St.
Wilmington, North Carolina 28405
We have audited the accompanying statement of financial po itio'n of Wilmington
Regional Film Commission, Inc. as of June 30, 2011, and the related statement o.
activities and changes in net assets, statement of functional expenses, and cash fl ows for
the year then ended. These financial statements are the responsibility of the
organizations' management. our responsibility is to express an opinion on these
financial statements based on our audit. The financial statements as of .Tune 30, 2010,
were audited by another auditor who expressed an unqualified opinion on the financial
st atements f or that period of tim
We conducted our audit in accordance with aud iting standards generally accepted in the
United Mates of America. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit al includ assessing the
accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to aloe present fairly, in all material
respects, the financial position of Wilmington Regional Film Commission, Inc., as of
.Tune 30, 2011, and its statement of activities and changes in net assets and cash flows for
the year them ended.
Goodson & Taylor, CPAs
September 10, 2011
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WILMINGTON REGIONAL FILM COMMISSION� INC.
STATEMENT OF FINANCIAL POSITION
June 3 0, 2011 and 2010
2011 2010
Assets
Cash 148,275 145
Prepaid Expenses 11,440 9,007
Property erty and Equipment 4 3
Total Assets 164, 521 158,63
Liabilities and Net Assets
Liabilities
Accrued Expenses 1 15
Total Liabilities 14527 15,641
Net Assets
Unrestricted 1 49 3 994 142
Total Net Assets 149,994 142
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Total Liabilities a Net As 164,521 158,6
The accompanying notes are a integral part of this statement.
WI REGIONAL FILM COMMISSION INC#
STATEM OF ACTIVITIES
June 30,2011 and 2010
2011 2010
W
Support and Revenue
Govennnental service agreements
City of Wilmington 109 $ 109,869
New Hanover County 10%585 10%585
Donations 12000
Advertising sales 27,465 34,586
Interest Income 275 681
Net assets released from restrictions 11,
Total Support and Revenue 247, 194 277,721
Expense
Program setvices 189 227,848
Management and General 29 33,291
Fund Raising 20 23,155
Total Expenses 240,189 284
lerease (Decrease) in Net Assets 1. 7,005 (6,573)
Net Assets - Beginning of Year 142 149,562
Net Assets -End of Year $ 1 49 $ 142,989
The accompanying notes are an integral part of this statement.
WILMINGTON REGIONAL FILM COMMISSION INC*
STATEMENT FUNCTIONAL EXPENSES
June 30, 2011 and 2010
2011
Manag meat
Prograrn and Fund- Total Total
Services General Raising 2011 2010
Compensation and related expenses
Compensation
Director $ 75,776 9,472- $ %472 94,720 $ 94,614
Production coordinator 183675 3296 21,971 35,526
Employee benefits
Retirement ent enefit 7'578 947 947 9,472 11,414
Payroll taxes 8 1,123 832 10 260 11,407
Health insurance 5,826 728 728 7 12
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Total compensation
and related expenses 116,160 .45,566 11 ,979 143 165,338
Other expenses
Production guide expenses 14753 8,095 22,848 26,366
Marketing and promotion 5,723 - 5,723 24,3'72
Lobbying efforts - - - 24po
Software annual fees 13,200 - - 13,200 -
.ent 11,357 1,103 401 13,361 13,256
Accounting 7,950 7,950 7,700
Vehicle rental and upkeep 2,975 1983 4,958 4,761
Insurance 4,141 460 - 4 3,997
Copier rental ' & maintenance 2,793 147 - 2,940 23579
Telephone and postage 3,632 191 3,523 2,388
Travel and conferences 5,724 - 5 2,232
Location scouting 1 - 1,946 1,575
Legal' expenses 3,582 3, 582
Office expenses 1,176 1,175 2,351 1,370
Policy Board 442 441 - 883 1,263
Computer & website services 1 135 - 1 1
Depreciation expense 1 120 - 1,247 801
Contingency M 1,042
Total Expenses 189,943 $ . 29,771 20,475 .$240 284,294
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The accompanying notes are an 'Integral part of this statement.
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4.
WILMINGTON REGIONAL FILM COMMISSION, INC&
STATEMENT OF CASH FLOWS
June 30, 2011 and 2010
2011. 2010
Cash Flows from operating Activities
Increase (Decrease) in Net Assets 7,005 (17,573)
Adjustments to Reconcile Net Assets
to Net Cash Provided by Operating Activities
Depreciation 1,247 801
(Increase) decrease in operating assets
Pledges receivable 11,E
Prepaid expenses (2,433) (351)
increase (decrease) in operating liabilities
Accrued expenses 1 (44,322)
Net Cash Provided by Operating Activities 4 (50,445)
Cash Plows from Investing Activities
Purchase of Capital Assets - Equipment (2,228) (2
Proceeds from sale of equipment 5
Net Cash Used by Investing Activities (2,228) (2,62 1
Net increase in Cash and Cash Equivalents 2,477 (53
Beginning Cash and Cash Equivalents 145798 1 98,64
Ending Cash and Cash. Equivalents $ 148,275 $ 1 45,798
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Supplemental Information
Interest Income 275
The accompanying notes are an integral part of this statement.
5.
WILMINGTON REGIONAL FILM COMMISSION, INC.
NOTES To FINANCIAL STATEMENTS
For the year ended .dune 3 o, 2011
Note I Nature of Activities
Wilmington Regional Film Commission, Inc. (the Commission) is a North Carolina
nonprofit corporation whose mission is to .improve business conditions for the common
interest of the film and video industry in southeastern North Carolina, act as a liaison
between the film industry, local governments, and communities in order to attract and
facilitate on- location film and video production in the area, and to increase film and video
production taking place in southeastern North Carolina and increase the economic impact
of the industry on the region. The Commission was established in May 1999. Six projects
began production in southeastern North Carolina during the year ended June 3 o, 201 o and
the Commission responded to over one hundred and twenty requests for information.
Those productions brought in approximately twenty -eight million dollars of revenue into
the community through wages paid to local artisans, craftsmen, and trades people, and
goods a efforts services purchased locally. The e its off' the Commission .d its staff were
influen ing factors in the decision to produce those films or other video productions in'
the area. The Commission is supported primarily through support from local governments
and sales of advertising in publication of its amival Production Guide.
Note Significant Accounting Policies
Method of Accounting
The financial statements of the Conunission have been prepared utilizing the accrual
basis of accounting and accordingly reflect all significant receivables, payales, and other
liabilities.
• Basis of Presentation
Financial . statement presentation follows the recommendations of the Financial
Accounting Standards Board in its Statement of Financial Accounting Standard SFAS
No. 117, Financial Statements of loot -- for - Profit Organizations. Under SFAS No. 117, the
onunaission is required to report information regarding its financial position and
activities according to three classes of net assets, unrestricted net assets, temporarily
restricted net assets, and permanently restricted net assets.
• Estimates
The preparation of financial statements in conformity with generally accepted accounting
principles requires naa"n to name estimates and assumptions that affect certain
reported amounts and disclosures. Accordingly, actual results could differ from those
estimates,
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WILMINGTON REGIONAL FILM COMMISSION, INC.
NO'S'ES To FINANCIAL STATEMENTS
For the year ended June 3 o, 2011
Support and Revenu
Contributions are generally available for unrestricted use in the year received unless
speclf �cally rstricted _ y the donor. Grants and other contributions of cash are reported as
temporarily restricted support if they are received with donor stipulations that limit the
use of the donated assets. Wh en a donor restriction expires, th at's, wh en a stipulated time
restriction ends or purpose re strict ion ' is accomplished, temporarily restricted net assets
are reclassifie to unrestricte net assets and reported in th e statement of activities as net
assets released from restrictions,
Income Taxes
The Co 1s a. not - for - profit organization that is exempt from inco taxes from
activities directly related to its exempt purpose under Section 5 01 c of the Internal
Revenue Code. However, profits relating to certain advertising activities of the
C ommission are subject to federal & forth Carolina taxation, Tax liability for the fiscal
years ended June 3 o, 2011 and 2010 respectively was $0 and $ 0 as a result of these
activities.
Property and Equipment
Property and e quipment are recorded at cost and depreciation is calculated on a
straightline basis over the estima use ful lives : of the assets. The Commission follows
the p ractice of capitalizing all expenditures for e uip neat in e c of $500. Lesser
amounts are typically expensed. property and equipment s of Jane oth consist ofd
2011 2010
Furnishings and fixtures 5,240 5,240
Office equipment 6fi35 4,407
Display booth ; . 2 2,802
Ca 2 2,064
Less: Accumulated Depreciation (11
Total Property and Equipment 4,806 , 2 5
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WILMINGTON REGIONAL FILM COMMISSION INC@
NOTES To FINANCIAL STATEMENTS
For the year ended June 3 0, 2011
Note 3 Concentrations
The Commission received over % of its support from New Hanover County and'the
City of Wilmington during the year ended June 30, 2011. A total of $219,454 was
received from both the City and County combined during each of the years ended
June 3 0, 2011 and 2010.
Note 4 SEP Retirement Plan
The Commission has a simplified employee pension plan co refing all full time
employees. The Commission makes a contribution to the plan each year equal to 10% of
all participant's compensation. Total expense for the year ended June 3 0, 2 011 and 2010,
respectively was $9,472 and $11;414%
Note 5 operating Lease Comm itments
The Commission leases office space- under an agreement expiring August 2012. This
lease may he terminated by either the lessor or the Commission with ninety clays notice.
The Commission also has a noncancela le operating lease for office e quipment which
expires April 2014. Both leases generally require the Commission to pay all executory
costs such as taxes, maintenance, and insurance. Rental expense for the lease of the office
equipment consisted of $2,592 and $2,579 for the years ended June 30, 2011 and 2010
respectively.
The Commission leases a.vehicle for use by its staff. The lease agreement is a month -to
month rental agreement which may be cancelled by either party with thirty clays notice.
Lease expense for the years ended June 30, 2011 an 1 Oxespectively was $3,747 and
$3,747. Future minimum lease payments under these operating leases that have
remaining terms in excess of one year as of June 3 0, 2011 are:
Year ending June 30:
2012 $ 15,953-
2013 3,705
2014 ,2,592 .
2015 .:
2016
Total 22250
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8.
WILMINGTON REGIONAL FILM COMMISSION, INC.
NOTES To FINANCIAL STATEMENTS
For the year ended June 30, 2011
Note 6 - Government Service Contracts
The Commission has service contract agreements with both the City of Wilmington and
New Hanover County. These contracts have a five -year term beginning July 2006 and
ending June 2011. Both contracts require the Commission to work diligently to attract
film and video production to the City and County, advise and work with each in regard to
all matters pertaining to film production, and have a representative from each serving on
the Commission's Board of Directors throughout the term of the contracts. The City and
County each agree to pay the Commission $90,000 a year for the life of the contracts
iffi annum increases based on a Consumer Price Index adjustment.
Note 7 Functional Allocation of Expenses
The costs of providing the programs and activities have been sununarized on a functional
basis in the statement of activities. Accordingly; " ceftai . nc.osts have been allocated among
the programs and supporting services benefited.
Note 8 Joint Costs of Activities
The Commission achieves some of its mission axed . fund - raising goals through the
publication of a production guide which 'is a listing of various- local service providers,
artists, craftsmen, and technicians to the motion picture industry. In the years ended June
30, 2011, and 2010 the costs of publishing the guide included a total of $26,366 and
$26,479 respectively, of j oint costs that 'axe not directly attributable to either the program
gram
mission or the fund- raising component of the ctl tie . Those joint costs were allocated
as follows*
2011 2010
Progra'n $ 14,753 15
Fund Raising 8 10,856
Total $ 22,848 $ 265479
Note.9 Subsequent Events
Subsequent events were evaluated through September 12, 2011, which is the date the
financial statements were available to be issued.
9.
Supplemental Information
10
WILMINGTON REGIONAL FILM COMMISSION, INC.
Budget to Actual Comparison fo'r the year ended June 30, 2011
Budget
Support and Revenue Budet Actual 'Variance
Governmental service agreements
City of Wilmington 1 09,869 1 09,869
New Hanover County 109 109,585 -
Advertising sales 32,000 27,465 (4,535)
Interest Income 600 275 (325)
Net assets from previous years 26,536 - 20,536)
Total Support and Revenue 278 247,194 X31,396)
Compensation and related expenses
Compensation
Director 94,720 94,720 -
Production coordinator 32po .21,971 10
Employee benefits
Retirement benefit 12,672 9,472 3
Payroll taxes 11 1 0,260 1,145
Health insurance 14,500 7 7,218
r
Total compensation
and related expenses , 165,297 143,705 21,592
Other expenses
Production guide expenses 25,000 '22,848 2,152
Marketing and promotion .81000 5 5 723 2,277
Software annual fees 14P0 13,200 800
Dent 1305 13,361 504
Accounting 71500 7,950 (450)
Vehicle rental and upkeep 4,300 4,958 (658)
Insurance :.5,228 4,601 627
Copier rental & maintenance 31000 2,940 6
Telephone and postage 3,000 3,823 (823)
Travel and conferences 8 5,724 2,276
Location scouting !P000 11946 2,054
Legal expenses 41000 3,582 418
Office expenses 2,300 2.351 51
Policy Board 4,000 883 3
Computer & rebsite services 1,500 1,347 153
Income tax 100 - 100
Depreciation expense - 1,24'7 (1 5 247)
Contingency .5 , 5
Total Expenses 278,590 240,189 38,401
Increase (Decrease) in Net Assets $ 7,005 7,005
Wl MINGTON lc�cfaA
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MAE= REGIONAL FILM COMMISSION INC. IT �'
1223 NORTH 23rd STREET s WILMINGTON, NC 28AO5 cwt
www.wilmington- Film.com • commish @wilmington- film.com HawrW aNShcb
ATTACHMENT "D"
Member of
in
ASSOCIATION OF
FILM COMMISSIONERS
INTERNATIONAL
PROPERTY INSURANCE UPDATE
The WRFC has property insurance from Hartford through James E. Moore Insurance
to cover the contents of the building, leased equipment (copier), computers, and
liability of others. Last year WRFC paid $1,076 for this coverage. Historically, the
premium increases approximately $50 annually based upon an increase in the
replacement cost of contents. We just received a notice of rate increase to $1,529.
Our rep at James E. Moore says premiums are increasing in this area due to an
increase in wind coverage.
In reviewing our options for coverage, it was discovered that the replacement value
of our building contents is valued at $81,000. This number is excessive given that
our inventory list shows assets valued at $17,000 (furniture, camera, tv, computers).
If we reduce our asset coverage to $25,000, Hartford will insure us for $1,003 with a
$500 deductible. If we switch carriers to Zurich, they will insure $25,000 of assets
for $750 with a $1,000 deductible.
My recommendation is that WRFC reduce its amount of insured assets from $81,000
to $25,000 and switch carriers from Hartford to Zurich. This immediate action will
result in annual savings initially valued at $779.
Wl MINGTON lc�cfaA
we L.F. &ww cftk=
MAE= REGIONAL FILM COMMISSION INC. IT �'
1223 NORTH 23rd STREET s WILMINGTON, NC 28AO5 cwt
www.wilmington- Film.com • commish @wilmington- film.com HawrW aNShcb
ATTACHMENT "E"
Member of
in
ASSOCIATION OF
FILM COMMISSIONERS
INTERNATIONAL
FILM COMMISSION DIRECTOR EVALUATION SURVEY
COMMISSIONER'S RELATIONSHIP WITH THE BOARD Rate 1-5 (5 bein the hi Comments
Keeps Board appropriatel informed about or chan activities and 1 2 3 4 5
status.
Consistentl maintains open communication with the Board. 1 2 3 4 5
Proves to be accessible to the Board to discuss concerns, ideas, and items of 1 2 3 4 5
interest.
Promptl responds to needs and re of the Board. 1 2 3 4 5
Keeps Board informed about new and impendin le or polic changes 1 2 3 4 5
that affect the film industr
Plans and or a s of reports for the Board that provides the most up 1 2 3 4 5
to date information concernin expenditures and revenue.
COMMISSIONER'S JOB PERFORMANCE Rate 1-5 (5 bein the hi Comments
Effectivel prepares and presents information on advanta of filmin within 1 2 3 4 5
the re to representatives of production companies, television studios, etc.
Consistentl coordinates, ne and assists in all aspects of on-location
filmin from pre-production throu principle photo and wrap activities 1 2 3 4 5
with both filmmakers and all in-state a municipalities, businesses, and
the private sector.
Consistenl meets with and escorts all out-of-state filmakin executives 1 2 3 4 5
interested in filmin in the Wilmin area.
Efficientl and effectivel prepares and develops the operatin bud for the
office reviews and authorizes proposed purchase re invoices and 1 2 3 4 5
pa necessar for the efficient operation of the office.
Director successfull derives private fundin for commission in the amount 1 2 3 4 5
a upon b the Board.
Displa abilit and skill to interpret and breakdown film scripts in order to
find the best suitable locations within the re and effectivel present this 1 2 3 4 5
information to film decision-makin executives.
COMMISSIONER'S RELATIONSHIP WITH THE COMMUNITY Rate 1-5 (5 bein the hi Comments
Ensures that an accomodatin and courteous attitude is extended to all parties 1 2 3 4 5
involved includin the Board, crew and communit
Develops a rapport with elected officials and communit leaders. 1 2 3 4 5
Communicates a positive ima of the WRFC throu the media. 1 2 3 4 5
Displa abilit to establish and maintain effective workin relationships with
filmmakin executives and representatives production companies cit state, 1 2 3 4 5
and federal municipalities in-state film and video companies rental e
houses technical support crews private businesses and the g eneral public.
Effectivel coordinates presentations to in-state media and various
or and civic g roups to include state, count and cit municipalities 1 2 3 4 5
throu the re
Successfull educates the public on the positive impact of the film industr in 1 2 3 4 5
the Southeast Re
00000OAdditional Comments:
Wl MINGTON lc�cfaA
we L.F. &ww cftk=
MAE= REGIONAL FILM COMMISSION INC. IT �'
1223 NORTH 23rd STREET s WILMINGTON, NC 28AO5 cwt
www.wilmington- Film.com • commish @wilmington- film.com HawrW aNShcb
ATTACHMENT "F"
Member of
in
ASSOCIATION OF
FILM COMMISSIONERS
INTERNATIONAL
W1 MINGTON
Jams LF. Snitl� ��
VAN= Vassar, V n
REGIONAL FILM COMMISSION, INC. HvnorablaTw ,Jr.
1223 NORTH 23rd STREET • WILMINGTON, NC 28405 cww
www.wilmington- film.com • commish @wilmington- film.com How iblfNSdfo
WILMINGTON REGIONAL FILM COMMISSION INC.
PRIVATE SECTOR SUPPORT
( Production Guide Ad S
YEAR AD SALES REVENUE PROFIT
2012 (in progress) $40, $ 12, 000
2011 27 4
2010 34 11
2009 41 15
2008 42 11
2007 36 9
2006 36 11
2005 29 7
2004 32 10
2003 37 11
2002 41 15
2001 47 15
Member of
ASSOCIATION OF
FILM COMMISSIONERS
INTERNATIONAL
Wl MINGTON lc�cfaA
we L.F. &ww cftk=
MAE= REGIONAL FILM COMMISSION INC. IT �'
1223 NORTH 23rd STREET s WILMINGTON, NC 28AO5 cwt
www.wilmington- Film.com • commish @wilmington- film.com HawrW aNShcb
ATTACHMENT "G"
Member of
in
ASSOCIATION OF
FILM COMMISSIONERS
INTERNATIONAL
W1 MINGTON
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REGIONAL FILM COMMISSION, INC. iMftn V ftw V k& CWh=
,n
1223 NORTH 23rd STREET • WILMINGTON, NC 28405 CNgfJ nes
www.wilmington film.com • commish @wilmington- film.com wbbm
WILMINGTON REGIONAL FILM COMMISSION, INC.
2011 PRODUCTION TOTALS
*AS OF 813112011
YEAR: 2011
TOTAL INQUIRIES 127
TOTAL PRODUCTION EXPENDITURES $ 92,000,000*
TITLES
FEATURES
Journey 2: The Mysterious Island (New Line Cinema)
Hick (Independent)
Piranha 3DD (Dimension Films)
Arthur Newman, Golf Pro (Independent)
TELEVISION
Cinderella Story: Once Upon A Song (Warner Premier) - MOW
Eastbound & Down (HBO) — season 3 - Series
One Tree Hill (WBTV) — season 8, 7 episodes - Series
One Tree Hill (WBTV) — season 9, 9 episodes - Series
Playing With Guns (Lionsgate TV) — Pilot
Teen Spirit (ABC Family) - MOW
Revenge (ABC Television) — Pilot
Hart of Dixie (WBTV) — Pilot
Game Time: Tackling The Past (Proctor & Gamble) — MOW
Hallmark Hall of Fame Presents - A Smile As Big As It Gets — (McGee Street Productions) - MOW
Member of
ASSOCIATION OF
FILM COMMISSIONERS
INTERNATIONAL