2008 Audited Financial Statements

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FINANCIAL STATEMENTS

MAY 31, 2008

GENESIS WORLD MISSION, INC.



GENESIS WORLD MISSION, INC.

Table of Contents

Page

INDEPENDENT AUDITORS’ REPORT 1

FINANCIAL STATEMENTS

Statement of Financial Position 2Statement of Activities 4Statement of Functional Expenses 5Statement of Cash Flows 7 Notes to Financial Statements



1

Morris W. Grigg, CPA American Institute of Certified Public AccountantsThomas J. Ritter, MS, CPA Idaho Society of Certified Public AccountantsDuane Brash, CPA

John J. Mahler, CPA

INDEPENDENT AUDITORS’ REPORT

To the Board of Directors

Genesis World Mission, Inc.Garden City, Idaho

We have audited the accompanying statement of financial position of Genesis World Mission, Inc. (an Idahononprofit organization) as of May 31, 2008 and the related statements of activities, functional expenses and cashflows for the year then ended. These financial statements are the responsibility of the Organization’smanagement. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America.Those standards require that we plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material misstatement. An audit includes examining, on a test basis, evidencesupporting the amounts and disclosures in the financial statements. An audit also includes assessing the

accounting principles used and significant estimates made by management, as well as evaluating the overallfinancial statement presentation. We believe our audit provides a reasonable basis for our opinion.

As described in Note 1 to the financial statements, the Organization has not included in-kind revenue andexpenses in the accompanying Statement of Activities and Statement of Functional Expenses for donatedmedicine. In our opinion, accounting principles generally accepted in the United States of America require thatsuch donated items be recorded at their fair value at the date of receipt. It was not practicable to determine theeffect of the unrecorded items on the financial statements.

In our opinion, except for the effects of the matters discussed in the preceding paragraph, the financial statementsreferred to above present fairly, in all material respects, the financial position of Genesis World Mission, Inc. asof May 31, 2008, and the changes in its net assets and its cash flows for the years then ended are in conformity

with accounting principles generally accepted in the United States of America.

November 3, 2008Boise, Idaho



GENESIS WORLD MISSION, INC.STATEMENT OF FINANCIAL POSITION

MAY 31, 2008

See accompanying notes to financial statements 2

ASSETS

CURRENT ASSETS

Cash and cash equivalents 54,985$

Grants receivable 24,523 Pharmacy and supply inventory 97,275

Total current assets 176,783

PROPERTY AND EQUIPMENT, at cost

Land 85,000

Building and improvements 480,738

Equipment and software 47,212

Less accumulated depreciation (47,572)

565,378

742,161$



GENESIS WORLD MISSION, INC.STATEMENT OF FINANCIAL POSITION

MAY 31, 2008


LIABILITIES AND NET ASSETS

CURRENT LIABILITIES

Accounts payable 114$

Accrued liabilities 12,702 Note payable, current portion 13,230

Total current liabilities 26,046

LONG-TERM LIABILITIES

Note payable, less current portion 278,407

304,453

NET ASSETS

Unrestricted 397,873

Temporarily restricted 39,835

Permanently restricted -

437,708

742,161$



GENESIS WORLD MISSION, INC.STATEMENT OF ACTIVITIES

YEAR ENDED MAY 31, 2008


Temporarily

Unrestricted Restricted Total

REVENUES, GAINS AND OTHER SUPPORT

Foundation and corporate grants 82,247$ 31,406$ 113,653$

State grants - 13,150 13,150

Contributions and support 161,203 25,137 186,340

Fundraising events 65,512 - 65,512

Interest income 2,240 - 2,240

Contracted revenue 9,388 - 9,388

Other 17,000 1,519 18,519

In-kind labor 310,559 - 310,559

In-kind materials and supplies 142,766 - 142,766

Net assets released from restrictions

Temporarily restricted 130,459 (130,459) -

Total revenues, gains and

other support 921,374 (59,247) 862,127

EXPENSES

Garden City Community Clinic

Medical program 384,193 - 384,193

Dental program 36,961 - 36,961

Total Garden City Community Clinic 421,154 - 421,154

Warehouse 1,790 - 1,790

Volunteer Physicians Network 30,799 - 30,799

International programs 175,220 - 175,220 Administration 71,983 - 71,983

Fundraising 93,885 - 93,885

Total expenses 794,831 - 794,831

CHANGE IN NET ASSETS 126,543 (59,247) 67,296

NET ASSETS, BEGINNING OF YEAR 271,330 99,082 370,412

NET ASSETS, END OF YEAR 397,873$ 39,835$ 437,708$



GENESIS WORLD MISSION, INC.STATEMENT OF FUNCTIONAL EXPENSES



Garden Garden Total

City City Garden

Community Community City Volunteer

Clinic Clinic Community Physicians(Medical) (Dental) Clinic Warehouse Network

Personnel 243,120$ 17,980$ 261,100$ 1,396$ 24,440$

Utilities and building maintenance 9,443 3,727 13,170 164 905

Interest expense 7,454 4,160 11,614 - 1,040

Professional fees 89,858 785 90,643 64 679

Direct international - - - - -

Medications and supplies 16,119 3,982 20,101 42 169

Fundraising events 351 53 404 - 53

Depreciation and amortization 7,458 4,163 11,621 - 1,040

Insurance 1,513 719 2,232 94 182 Postage and delivery 598 85 683 5 198

Printing and reproduction 1,582 121 1,703 11 595

Advertising 327 34 361 - 756

Travel and entertainment 2,866 285 3,151 - 515

Repairs, maintenance and

minor equipment 1,155 197 1,352 14 227

Other 2,349 670 3,019 - -

384,193$ 36,961$ 421,154$ 1,790$ 30,799$



GENESIS WORLD MISSION, INC.STATEMENT OF FUNCTIONAL EXPENSES



International

Medical Admin- Fund-Missions istration raising Total

Personnel 37,135$ 60,476$ 33,692$ 418,239$

Utilities and building maintenance 1,740 2,477 603 19,059

Interest expense 2,254 1,907 520 17,335

Professional fees 1,247 2,246 779 95,658

Direct international 106,914 - - 106,914

Medications and supplies 1,195 221 593 22,321

Fundraising events 227 67 50,487 51,238

Depreciation and amortization 2,255 1,908 520 17,344

Insurance 535 826 78 3,947 Postage and delivery 294 202 1,687 3,069

Printing and reproduction 878 803 2,907 6,897

Advertising 508 43 418 2,086

Travel and entertainment 19,125 807 661 24,259

Repairs, maintenance and

minor equipment 472 - 691 2,756

Other 441 - 249 3,709

175,220$ 71,983$ 93,885$ 794,831$



GENESIS WORLD MISSION, INC.STATEMENT OF CASH FLOWS



CASH FLOWS FROM OPERATING ACTIVITIES

Increase in net assets 67,296$

Adjustments to reconcile increase in net assets to net cash

provided by operating activities:

Donated capital assets (54,945)

Depreciation and amortization 17,344

Increase (decrease) in:

Prepaid expenses 849

Accounts receivable 4,800

Grants receivable 17,363

Inventory (97,275)

Accounts payable (4,424)

Accrued expenses (1,051)

Net cash used by operating activities (50,043)

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of capital assets (49,445)

Net cash used by investing activities (49,445)

CASH FLOWS FROM FINANCING ACTIVITIES

Payments on long-term debt (16,729)

DECREASE IN CASH AND CASH EQUIVALENTS (116,217)

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 171,202

CASH AND CASH EQUIVALENTS, END OF YEAR 54,985$

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATIO

Interest paid 19,078$

Non-cash financing and investing activities

Donated capital assets 54,945$



GENESIS WORLD MISSION, INC.NOTES TO FINANCIAL STATEMENTS

MAY 31, 2008

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NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Activities

Genesis World Mission, Inc ("Organization") is a non-profit, faith based organization providing medical, physicaland spiritual care for the underserved. The organization operates a medical and dental clinic in Garden City, Idahoand manages a county-wide Volunteer Physicians Network. It also works to provide sustainable humanitarianmedical aid internationally and operates a warehouse to supply both the clinic and international projects. In 2008,the organization helped establish and continues to help operate a medical clinic in Ndumberi, Kenya in partnership with a separate in-country organization.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand as well as checking and savings accounts with financialinstitutions. The Organization considers all short-term investments purchased with a maturity of three months or

less to be cash equivalents. Cash is maintained in a Boise area financial institution.

Pledges and Grants Receivable

Pledges and grants receivable are stated at unpaid balances, less an allowance for uncollectible amounts.Balances are non-interest bearing. The allowance is based on experience. It is the Organization’s policy tocharge off uncollectible receivables when management determines the receivable will not be collected. There wasno allowance at May 31, 2008 as all amounts are deemed collectible.

Inventories

Pharmaceutical and medical supplies are either donated or purchased. The values of pharmaceutical donations are

not recorded in the financial statements, except the year end balance. As of May 31, 2008, the value of purchaseditems and donated medical supplies have been capitalized as supplied inventory at the lower of cost or market.

Property and Equipment

Purchased property, equipment and software is recorded at cost. Donated property, equipment and software arevalued in the financial statements when used on Organization projects. Other donated property and equipmentwhich is passed through the warehouse to other organizations are not valued in the financial statements.Purchased property and equipment are depreciated on a straight-line basis over the estimated useful lives of theassets.

Federal and State Income Taxes

Under Section 501(c)(3) of the Internal Revenue Code, as well as under Idaho state law, the Organization isconsidered to be a nonprofit organization and is therefore exempt from federal and state income taxes. It has beenclassified as an organization that is not a private foundation under Section 509(a)(2) of the Internal RevenueCode.




MAY 31, 2008

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NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)

Concentration of Credit Risk

For the fiscal year ended May 31, 2008, the Organization has maintained various bank accounts with Idahofinancial institutions. At times during the year, the bank balances were in excess of the $100,000 federaldepository insurance coverage.

In-Kind Contributions

The Organization records donated services for volunteers who perform work similar to salaried personnel and area significant and integral part of the efforts of the Organization. Contributions of donated non-cash assets arerecognized at fair value in the financial statements.

Use of Estimates

The Organization uses estimates and assumptions in preparing financial statements. Those estimates andassumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and l iabilities,and the reported revenues and expenses. It is at least reasonably possible that the estimates will change within thenext year.

Promises to Give

Contributions and grants are recognized when the donor or grantor makes an unconditional promise to give to theOrganization. All donor-restricted contributions and grants are reported as increases in temporarily or permanently restricted net assets depending on the nature of the restrictions. When a restriction expires,temporarily restricted net assets are reclassified to unrestricted net assets.

Restricted Funds

The Organization reports gifts of cash and other assets as restricted support if they are received with donor stipulations that limit the use of the donated assets. When a donor restriction expires, that is, when a stipulatedtime restriction ends or purpose restriction is accomplished, temporarily restricted net assets are reclassified tounrestricted net assets and reported in the statement of activities as net assets released from restrictions.

Grant Revenues

All grants, except for expenditure reimbursement grants, are recognized as income when the grantor agencyagrees to provide the funds to the Organization. Expenditure reimbursement grants are recognized as income

when the related expenditures are made.

NOTE 2 - PATIENT GOODS AND SERVICES REVENUE

The Organization operates the Garden City Community Clinic and has a policy of providing free medical care to patients who do not have third-party coverage. Therefore, no revenue from medical services is recorded.Eligibility is based on household size and income based on 200% of the Federal Poverty Guidelines.




MAY 31, 2008

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NOTE 3 - NOTE PAYABLE

During 2006, the Organization acquired the building and associated land they were previously leasing for a

purchase price of $425,000 resulting in a long-term note payable of $415,000. During 2007, an unscheduled principal payment of $100,000 was made on the note from funds provided by a grant from the Laura MooreCunningham Foundation. Terms of the note are as follows:

291,637$

Less current portion 13,230

278,407$

At May 31, 2008, maturities of long-term debt are as follows:

2009 13,230$

2010 14,186

2011 15,212

2012 16,311

2013 17,490

Thereafter 215,208

291,637$

Note payable to the Ashley's, interest at 7.0% amortized over 30 years, with monthly

payments of principal and interest of $2,761 through April 1, 2016 with a balloon payment

due April 1, 2016, collateralized by land and building.

NOTE 4 - TEMPORARILY RESTRICTED NET ASSETS

At May 31, 2008, the following net assets are temporarily restricted for specific use purposes:

John F Nagel Digital X Ray Funds 13,434$

John F Nagel GAPMed Funds 7,570

Laura Moore Cunningham Building Funds 8,363

Harry Morrison Foundation (Fire Equipment) Funds 8,122

Rotary Transportation Funds 653

Rotary Hygiene Funds 500

Kiwanis Clinic Equipment Funds 634 Kenya Trip Funds 559

39,835$




MAY 31, 2008

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NOTE 5 – RELATED PARTY TRANSACTIONS

The Organization has valued the in-kind services of five of its board members for professional services provided

during the year (outside of board responsibilities.) The value of said services, as determined by management, is$61,195 and is reflected in the financial statements.

The Organization also accepts cash and in-kind donations (such as tangible goods and fundraising auction items)from board members and employees. The value of cash donations by board members and employees is $57,056;the value of in-kind donations by the same is $5,796. In-kind amounts are determined by management and arereflected in the financial statements.

2008 Audited Financial Statements

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