April 3, 2005
TESFAYE ASMAMAW CERTIFIED PUBLIC ACCOUNTANT
P.O. Box 13267 Silver Spring, MD 20911 (202) 207-6038
INDEPENDENT AUDITOR’S REPORT
To The Ethiopian Community in Washington D.C. and Metropolitan Area:
I have audited the accompanying statement of revenues and expenses—cash basis of the Ethiopian National Election Campaign 2005 (the Committee) for the period ended on March 12, 2005. This financial statement is the responsibility of the Committee. My responsibility is to express an opinion on this financial statement based on my audit and to ascertain the distribution of these funds to the different political groups consistent with the Committee’s criteria.
I conducted my audit in accordance with auditing standards generally accepted in the United States of America.
INCOME STATEMENT
FOR THE PERIOD ENDED, MARCH 12, 2005
Revenue:
Ticket Sales $89,2001
Donations 51,513
Food and Beverages 2,317
Post March 12th Donations 5,900
Item sales 0
Total Sales $148,930
Expenses:
Promotion and Radio Advertisement 8,009
Convention Hall Rental and Security 5,694
Printing 2,313
Sound Systems and Video 1,710
Air Tickets 1,911
Banquet Service 1,904
Hotel 803
Other Miscellaneous Expenses 659
Insurance 140
Bank Charges for wire transfer 80
Total Expenses 23,223
Net Income $125,707
In-Kind Contributions
In-Kind contributions are the value of non-cash contributions provided by individuals, groups, and the business community. These contributions were examined and subsequently recognized since the value of the goods and services directly benefited the event. Furthermore, as part of the audit process, each in-kind contribution was valued based on the prevailing market price in the normal course of business in arms-length transaction. Famous Ethiopian musicians, poets, restaurant owners, and other individuals in all walks of life made these in-kind contributions. The proceeds from the sales of donated food and beverage totaling $2,317 is recorded in the income statement above.
Below is the listing of all in-kind contributors who provided goods (food and beverage), entertainment, and other invaluable services.
Name In-Kind contribution Value
Volunteer musicians and other artists $20,000
Voice of Ethiopian Unity 1,200
Etete Restaurant 400
Maaza Restaurant 400
Sodere Restaurant 400
Dama Restaurant 300
Dukem Restaurant 300
Lalibela Restaurant 300
Twins 200
Zelalem Enjera 75
Ergoye Enjera 50
Indipendent Auditor 1
Total In-Kind Contributions $23,626
ETHIOPIAN NATIONAL ELECTION CAMPAIGN 2005
NOTES TO THE FINANCIAL STATEMENT
NOTE A – ORGANIZATION
Ethiopian National Election Campaign 2005 is volunteer-based ad hoc committee formed to generate funds through fundraising and other legitimate activities to help “qualified political organizations” financially for the upcoming national election on May 15, 2005. This committee will cease to exist once the election is over on that day.
NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The income statement of Ethiopian National Election Campaign 2005 is prepared on the cash basis of accounting, which is a comprehensive basis of accounting other than accounting principles generally accepted in the United States of America. The cash basis differs from accounting principles generally accepted in the United States primarily because revenues and related assets are recognized when received rather than earned and expenses are recorded when paid not when incurred. Non-cash transactions (in-kind contributions) are not recognized in the body of the income statement.
NOTE C – Revenue
Revenue in this case includes cash and cash equivalents deposited in the Committee’s account. Below is the listing of all ticket distributions and sales for the March 12, 2005 event.
ETHIOPIAN NATIONAL ELECTION CAMPAIGN 2005
Ticket Sales # of Tickets Sales Value
Tickets printed 4,000 200,000
Unsold Tickets 2,216 110,800
Ticket Sales 1,784 89,200
NOTE D – DONATIONS
During the fundraising event at the convention center on March 12, 2005 the following donations were obtained and collected and subsequently deposited in the Committee’s account.
CASH AND CHECK CONTRIBUTIONS during the Fundraising Event
Cash Contributions 28,063.00
Check Contributions 11,620.00
Credit Card Pledges 7,630
Less: Total Rejected Amount (2,300) 5,330.00
Total Cash and Check Contributions 1,784 45,013.00
The total donations contributed at the March 12, 2005 fundraising event (cash, checks, and credit cards) was $45,013. Furthermore additional $6,500 was collected after the event. Therefore, total donated amount is $51,513 and this amount does not include any pledges made or received on any of the weekend radio programs.
NOTE F – Item Sales
As part of the fundraising activity, the participants of the event held competitive bids for donated items. A T-shirt marked “Vote or Die” donated by an individual and Neway Debebe’s famous album was purchased by an individual for a total price of $3,000 and payment was tendered by Discover Card. Due to technical problems by the Committee and unbeknown to the purchaser, the transaction was not processed. The Committee tried to contact the individual with the telephone number he provided. However, that telephone number is no longer in service and every attempt is being made to contact him.
Furthermore, a gold necklace donated during the fundraising activity was also up for bidding and sold for $1,000. The purchaser has been contacted and the proceed was never collected as of today April 3, 2005, the audit report date.
NOTE G – Promotion and Advertisement
Advertising expenses are expenses incurred and paid to the three of the major radio programs held on the weekends by the Committee to reach out the Ethiopian community in the metropolitan area. These payments were made to cover the costs of air time these radio programs pay to the owners of the station.
The following are a listing the radio programs and payments made during the period under audit:
Hager Feker Radio $2,890
Ethiopiawinet Radio 2,619
AndEthiopia Radio 2,500
Total $8,009
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This report as been condensed by ER