Title: Nature of Organization
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Elev8 Baltimore, Inc. (Elev8) is a nonprofit organization working to provide out-of-school opportunities, school-based health services, and support to the families of Baltimore City students. They help integrate all these services into one dynamic program inside the school building. Elev8’s offices are located in Baltimore, MD. Elev8’s main sources of revenue are grants, contributions, and revenue from contracts
Title: Basis of Accounting
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
Title: Financial Statement Presentation
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Net assets and revenues are classified based on the existence or absence of donor-imposed restrictions. Accordingly, net assets and changes therein are classified and reported as follows: Net Assets Without Donor Restrictions - Net assets that are not subject to donor-imposed stipulations and may be used at the board’s discretion. Net Assets With Donor Restrictions - Net assets subject to donor-imposed restrictions. Some donor-imposed restrictions are temporary in nature, such as those that will be met by passage of time or other events specified by the donor. Other donor-imposed restrictions are perpetual in nature, where the donor stipulates those resources be maintained in perpetuity. Donor-imposed restrictions are released when a restriction expires, that is, when the stipulated time has elapsed, when the stipulated purpose for which the resource was restricted has been fulfilled, or both. As of June 30, 2024, Elev8 had net assets with donor restrictions of $504,814.
Title: Income Tax Status
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Elev8 is exempt from income taxes under Section 501(c)(3) of the U.S. Internal Revenue Code and is classified by the Internal Revenue Service as a not-for-profit organization that is not a private foundation. Entities that are classified under this section of the code are taxed on “unrelated business income” as defined by IRS regulations. Elev8 had no unrelated business income for the years ended June 30, 2024. Accordingly, no provision for income taxes is made in the financial statements. Elev8 follows the provisions of Accounting for Uncertainty in Income Taxes under the Income
Taxes Topic of the Codification. The Codification requires the evaluation of tax positions, which
includes maintaining its tax-exempt status and the taxability of any unrelated business income,
and does not allow recognition of tax positions which do not meet a “more-likely-than-not”
threshold of being sustained by the applicable tax authority. Management does not believe it
has taken any tax positions that would not meet this threshold. Elev8’s income tax returns are
subject to possible federal examination, generally for three years after they are filed.
Title: Use of Estimates
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
The preparation of financial statements, in conformity with accounting principles generally accepted in the United States of America, requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
Title: Cash and Cash Equivalents
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
For the purposes of the statement of cash flows, Elev8 considers cash in operating bank accounts, savings accounts, and money market accounts with maturities of three months or less to be cash equivalents.
Title: Grants Receivable
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Unconditional grants receivable are recorded as revenue and receivable in the year the grants are made. Conditional grants, that is, those with a measurable performance or other barriers and a right of return, are not recognized until the conditions on which they depend have been substantially met. All receivables are expected to be collected within one year.
Title: Concentration of Credit Risk
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Elev8 maintains its cash balances at institutions with balances that may exceed $250,000, which is the amount insured by the Federal Deposit Insurance Corporation. Elev8 has not experienced any losses in such accounts. Management believes that Elev8 is not exposed to any significant credit risk with respect to cash balances.
Title: Revenue
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Elev8 has both contribution revenue and revenue from contracts which follow accounting
practices as follows: Contribution Revenue
Elev8 receives grants and contributions from individuals, corporations and government
agencies. Contributions and grants are recognized as revenues in the period verifiably
committed. Unconditional grants and contributions are recorded as increases in net assets
without donor restrictions or net assets with donor restrictions depending on the existence
and/or nature of any donor restrictions. Amounts received with donor-imposed restrictions
that are recorded as donor-restricted revenues are reclassified to net assets without donor
restrictions when the time or purpose restriction has been satisfied. Grants and contributions
received for which donor-imposed restrictions will be met in future periods are recorded as
donor restricted and are released from restrictions as conditions are met.
Conditional contributions are recorded as revenue when such amounts become unconditional
which generally involves the meeting of a barrier to entitlement. This can include items like
incurring specified allowable expenses in accordance with a framework of allowable costs or
other barriers. For the year ended June 30, 2024, Elev8 recognized conditional grants
approximating $3,797,831. At June 30, 2024, Elev8 had $1,355,380 of unrealized conditional
grant revenue of which $4,124 had been received in advance. This amount is recorded as
refundable advances on the statement of financial position.
Title: Revenue from Contracts
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Revenue from contracts follows a principles-based process to assess and determine revenue recognition. This includes that Elev8: 1) identify the contract with the customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations; and 5) recognize revenue when or as performance obligations are satisfied. Revenue from contracts is recorded over time as project work is completed and the customer receives and consumes the benefits. As such, Elev8 recognizes revenue based on the output method by calculation of the time elapsed satisfying the performance obligation with the time period over which the performance obligation is satisfied. For the year ended June 30, 2024, Elev8 recognized $3,016,508 of revenue over time.
Title: Leases
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Elev8 does not recognize short-term leases in the statement of financial position. For these leases, Elev8 recognizes the lease payments in the change in net assets on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred. Elev8 also does not separate non-lease components from lease components for all classes of underlying assets and instead accounts for each separate lease component and the non-lease components associated with that lease component as a single lease component. If the rate implicit in the lease is not readily determinable, Elev8 uses a risk_x0002_
Title: Functional Expense Allocations
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
The financial statements report certain categories of expenses that are attributed to more than one program or supporting function. Therefore, expenses require allocation on a reasonable basis that is consistently applied. Expenses are allocated on the basis of estimates of time, effort, or based on identification of a specific program.
Title: Advertising Costs
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Advertising costs are generally expensed when incurred.
Title: Evaluation of Subsequent Events
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Management has evaluated subsequent events through April 9, 2025, the day the financial statements were available to be issued and concluded that no subsequent events have occurred that would require recognition in the financial statements or disclosure in the notes to the financial statements.
Title: Fiscal Sponsorship Agreement
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Elev8 entered into an agreement with Fund for Educational Excellence (the Fund) to provide program management services. Either party has the right and discretion to terminate this agreement at any time upon thirty days’ written notice to the other party. Under the terms of this agreement, Elev8 pays an administrative fee based on expenses processed on its behalf by the Fund. Elev8 incurred fiscal sponsorship fees equal of $368,236 for the year ended June 30, 2024.
Title: Liquidity and Availability
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Financial assets available for general expenditure, that is, without donor or other restrictions limiting their use, within one year of the statement of financial position, comprise the following: 2024 Financial Assets: Cash and Cash Equivalents $ 193,348) Grants and Accounts Receivable 3,349,356) Total Financial Assets 3,542,704) Less Amounts Not Available for General Purposes: Refundable Advances (4,124) Restricted by Donors with Purpose Restrictions (504,814) Financial Assets Available to Meet Cash Needs for General Expenditures within One Year $ 3,033,766) Elev8 has $3,033,766 of financial assets available within one year of the statement of financial position date to meet cash needs for general expenditures. None of this amount is subject to donor or other contractual restrictions that make them unavailable for general expenditures within one year of the statement of financial position date. The Organization has a policy to structure its financial assets to be available as its general expenditures, liabilities, and other obligations come due
Title: Grants and Accounts Receivable
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Grants and accounts receivable are receivable within one year. Management evaluates receivables at the end of each year and establishes an allowance for doubtful accounts based on the aging of the receivables and other factors. At June 30, 2024, an allowance for doubtful accounts was not considered necessary because all receivables were considered fully collectible. Accounts for which no payments have been received for eighteen months are written off as bad debts. There were $5,631 in bad debts for the year ended June 30, 2024. Grants and accounts receivable was $3,349,356 for the year ended June 30, 2024.
Title: Line of Credit
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Elev8 has a revolving line of credit with M&T Bank secured by the assets of the Organization. Interest is M&T Bank’s Prime Rate plus 3.0%. The interest rate on the notes was 11.50% per annum as of June 30, 2024. Available borrowings as of June 30, 2024 totaled $0.
Title: Restrictions on Net Assets
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Net assets with donor restrictions are comprised of the following as of June 30: 2024 Restricted by Purpose: Program Services $ 504,814 Total Net Assets with Donor Restrictions $ 504,814
Title: Revenue and Support Concentration
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
For the year ended June 30, 2024, federal grants and city grants approximated 36% and 13%, respectively, of Elev8’s revenue.
Title: Retirement Plan
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
Elev8 established a 403(b) thrift plan covering employees age 21 or older with six months and 1,000 hours of service. Under the Plan, employees may contribute a portion of their pre-tax earnings to an individual retirement account. The Plan allows for discretionary employer contributions. For the year ended June 30, 2024, Elev8 made matching contributions of $56,357 to the 403(b) thrift plan.
Title: Leases
Accounting Policies: The financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
De Minimis Rate Used: Y
Rate Explanation: Elev8 has elected to use the de minimis indirect rate allowed under the Uniform Guidance (currently 10% at June 30, 2024) applied to overall expenditures.
In February 2023, Elev8 entered into a lease agreement for a copy machine with Advance. The term of the lease is for five years, commencing on February 1, 2023 and terminating on January 31, 2028. Base monthly rent is $429 for the entirety of the lease. In August 2023, Elev8 entered into a lease agreement for office space at 210 West 28th Street, Baltimore, Maryland 21211. The term of the lease is for five years, commencing on November 1, 2023 and terminating on October 31, 2028. Base monthly rent for the first lease year is $7,045, with 4% increases in base monthly rent every lease year thereafter. Elev8 has the right to extend the lease term for a period of five years by notifying the landlord in writing no later than six months prior to expiration of lease term. In May 2024, Elev8 entered into a lease agreement for program space at 946-948 W. Patapsco Avenue, Baltimore, Maryland 21230. The term of the lease is for five years and one month, commencing on June 1, 2024 and terminating on June 30, 2029. First month’s rent is abated, and base monthly rent for the next subsequent year is $2,300, with 5% increases in base monthly rent every lease year thereafter. During the year ended June 30, 2024, Elev8 recognized rent expense associated with its leases
as follows:
Lease Cost:
Operating Lease Expense $ 68,704
Short-Term Lease Expense 786
Total Lease Cost $ 69,490
During the year ended June 30, 2024, Elev8 had the following cash and non-cash activities
associated with its leases:
Cash Paid for Amounts Included in the Measurement
of Lease Liabilities:
Operating Cash Flows from Operating Leases $ 54,300
Non-cash Operating Activities:
Right-of-Use Assets Obtained
In Exchange for Lease Liabilities $ 564,029
Weighted-Average Remaining Lease Term 4.48 years
Weighted-Average Discount Rate 4.20%
The approximate future minimum payments under the non-cancelable operating lease
agreements are as follows for the years ending June 30:
2025 $ 119,379)
2026 124,335)
2027 129,640)
2028 132,818)
2029 66,507)
Future Cash Payments 572,679)
Lease Discounting Effects (51,660)
Operating Lease Liability $ 521,019