[ga] ICANN | 6-Month Financial Report for Period Ending 31 December 2000

[eric dierker <eric@hi-tek.com>]

This is really amazing.

funny thing though, no one claims responsibility for creating this
report.

Eric

http://www.icann.org/financials/financial-report-fpe-31dec01.htm

Title: ICANN | 6-Month Financial Report for Period Ending 31 December 2000

6-Month Financial Report for Period Ending 31 December 2001

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The following financial report has been prepared by ICANN management to provide information regarding ICANN's financial performance and condition for the six months ending 31 December 2001. Unlike ICANN's annual financial reports, it is not audited.

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INTERNET CORPORATION FOR ASSIGNED NAMES AND NUMBERS
STATEMENT OF FINANCIAL POSITION
December 31, 2001

ASSETS

Cash and cash equivalents	$1,013,289
Accounts receivable (less allowance for doubtful accounts of $117,169)	2,046,030
Other assets	16,929
Property and equipment (less accumulated depreciation of $206,980)	285,873
TOTAL ASSETS	$3,362,121

LIABILITIES AND NET ASSETS

Accounts payable and accrued liabilities	$982,853
Deferred revenue	248,260
Loans payable	32,841
Total Liabilities	1,263,954
Net assets:
Unrestricted	1,935,473
Temporarily restricted	162,694
Total Net Assets	2,098,167
TOTAL LIABILITIES AND NET ASSETS	$3,362,121

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INTERNET CORPORATION FOR ASSIGNED NAMES AND NUMBERS
STATEMENT OF ACTIVITIES
Six months ended December 31, 2001

Changes in unrestricted net assets:
Support and revenue:
Domain name registry and registrar fees	$1,520,800
Accreditation fees	531,010
Application fees	41,500
Contributions	116,785
Contributed services	93,495
Interest income	12,777
Net assets released from restrictions	84,897
Total Support and Revenue	2,401,264
Expenses:
Personnel	912,435
Board and public meetings	634,918
Other meetings and travel	164,337
Professional services	922,349
General and administrative	625,973
Total Expenses	3,260,012
Decrease In Unrestricted Net Assets	(858,748)
Changes in temporarily restricted net assets:
Contributions and grants	67,943
Net assets released from restriction	(84,897)
Decrease In Temporarily Restricted Net Assets	(16,954)
DECREASE IN NET ASSETS	(875,702)
Net assets at July 1, 2001	2,973,869
NET ASSETS AT DECEMBER 31, 2001	$2,098,167

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INTERNET CORPORATION FOR ASSIGNED NAMES AND NUMBERS
STATEMENT OF CASH FLOWS
Six months ended December 31, 2001

Cash Flows From Operating Activities:
Decrease in net assets	$(875,702)
Adjustments to reconcile change in net assets to net cash provided by (used in) operating activities:
Depreciation	71,721
Increase in allowance for doubtful accounts	89,788
Loss on disposal of fixed assets	9,284
Changes in operating assets and liabilities:
Decrease in accounts receivable	654,908
Decrease in other assets	9,833
Increase in accounts payable and accrued liabilities	280,625
Decrease in deferred revenue	(176,271)
Net Cash Provided By Operating Activities	64,186
Cash Flows Used In Investing Activities:
Purchases of property and equipment	(39,990)
Cash Flows Used in Financing Activities:
Principal payments on loans payable	(10,859)
Principal payments on notes payable	(875,000)
Net Cash Used In Financing Activities	(885,859)
Net Decrease In Cash and Cash Equivalents	(861,663)
Cash and cash equivalents at July 1, 2001	1,874,952
CASH AND CASH EQUIVALENTS AT DECEMBER 31, 2001	$1,013,289
Supplemental Cash Flow Information:
Cash paid during the year for interest	$9,849

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INTERNET CORPORATION FOR ASSIGNED NAMES AND NUMBERS
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2001

 

NOTE A - ORGANIZATION

Internet Corporation for Assigned Names and Numbers (ICANN) was established in September 1998 under the laws of the state of California. ICANN coordinates a select set of the Internet's technical management functions such as the assignment of protocol parameters, the management of the domain name system, the allocation of Internet protocol (IP) address space, and the management of the root server system. Categories of Internet domains include Generic Top Level Domains (gTLDs) which include the.com,.net, .org, and.edudomains and Country Code Top Level Domains (ccTLDs) examples of which are.us,.uk, and.fr. ICANN generates income from fees received from domain name registrars and related accreditation activities. Its primary sources of revenue are as follows:

Domain name registry and registrar fees- Amounts contributed by organizations responsible for the registration and administration of Internet Domain Names.

Address registry fees- Amounts contributed by organizations responsible for the assignment and administration of Internet addresses.

Accreditation fees- Amounts paid in connection with initial and renewal accreditation of organizations engaged in the registration and administration of domain names in the .com, .net, .biz, .info, .museum, .name and .org Internet domains.

Application fees- Amounts paid in connection with processing of applications to become accredited domain name registrars.

ICANN also receives contributions and grants from other organizations.

ICANN has three supporting organizations which serve as advisory bodies to the ICANN board of directors with respect to internet policy issues and structure within three specialized areas, including the system of IP addresses, the domain name system and parameters for internet protocols. The supporting organizations are the primary source of substantive policy recommendations for matters lying within their respective specialized areas. The three supporting organizations are the Address Supporting Organization (ASO), Domain Name Supporting Organization (DNSO) and the Protocol Supporting Organization (PSO). The accounts of DNSO are included in the accompanying financial statements as ICANN, on behalf of DNSO, receives and processes the contributions that DNSO receives from its constituencies.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation- The financial statements of ICANN have been prepared on the accrual basis of accounting.

ICANN recognizes contributions, including unconditional promises to give, as revenue in the period received. Contributions and net assets are classified based on the existence or absence of donor-imposed restrictions. As such, the net assets of ICANN and the changes therein are classified and reported as follows:

Unrestricted net assets- Net assets that are not subject to donor-imposed stipulations and that may be expendable for any purpose in performing the objectives of ICANN.

Temporarily restricted assets- Net assets subject to donor-imposed stipulations that may or will be met either by actions of ICANN and/or the passage of time. As the restrictions are satisfied, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the accompanying financial statements as net assets released from restrictions.

Permanently restricted net assets- Net assets subject to donor-imposed stipulations that resources be maintained in perpetuity. Investment income generated from these funds is available for general support of ICANN's programs and operations unless otherwise stipulated by the donor.

As of December 31, 2001, ICANN has no permanently restricted net assets.

Functional allocation of expenses- Expenses that can be identified with a specific program or supporting service are charged directly to the related program or supporting service. Expenses that are associated with more than one program or supporting service are allocated based on methods determined by management. As of and for the six months ended December 31, 2001, ICANN's expenses are classified as follows:

Program services	$2,223,444
Supporting services - management and general	1,036,568
TOTAL	$3,260,012

Cash and cash equivalents- Cash and cash equivalents include deposits in bank, money market accounts, and marketable commercial paper.

Concentration of credit risk- All of ICANN's cash and cash equivalents are maintained at one commercial bank. At December 31, 2001, ICANN had cash in the bank in excess of Federal Deposit Insurance Corporation (FDIC) insurance limits of approximately $768,000.

The accompanying financial statements include certain ccTLD and IP Address registry accounts receivable balances totaling $1,029,000 as of December 31, 2001. The inclusion of these receivables is based primarily on verbal understandings between ICANN and the participating registries. Such receivables and revenues are not supported by written agreements nor has any valuation allowance for collectibility been established relating to these accounts.

It is the policy of management to reserve against all invoices that remain unpaid for more than 180 days.

Property and equipment- Property and equipment are stated at cost or, for contributed items, at fair market value at date of contribution. The equipment, furniture and fixtures are being depreciated using the accelerated method over estimated useful lives of five to seven years or the remaining lease term, whichever is shorter.

Deferred revenue/Accreditation fees- Accreditation fees attributable to future activities are included in cash and cash equivalents or accounts receivable and reflected as deferred revenue until earned.

Promises to give- Unconditional promises to give that are expected to be collected within one year are recorded at estimated net realizable value. Unconditional promises to give that are expected to be collected in future years are recorded at the present value of the estimated future cash flows. Conditional promises to give are not included as support until the conditions are substantially met.

Contributed services- Contributed services are recognized only if the services (a) create or enhance long-lived assets, or (b) require specialized skills, are provided by individuals possessing those skills and would typically need to be purchased if not provided by donation. For the six months ended December 31, 2001, contributed legal services totaling $93,495 are included in the statement of activities as contributed services and professional services expense.

Income taxes- ICANN is exempt from federal and state income taxes under the provisions of Section 501(c)(3) of the Internal Revenue Code and Section 23701(d) of the California Revenue and Taxation Code. Accordingly, no provision for income taxes has been made in the accompanying financial statements.

Use of estimates- The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

NOTE C - ACCOUNTS RECEIVABLE

Accounts receivable is comprised of the following constituencies for various registry and accreditation fees at December 31, 2001:

ccTLD's	$39,000
gTLD's	1,204,000
IP address registries	856,000
DNSO constituencies	64,000
	$2,163,000

Written agreements have not yet been reached with the certain name and address registry operators for amounts billed totaling $874,000.

As described in Note B it is the policy of the Company to establish a reserve for all invoices that remain unpaid for more than 180 days. Management has determined that it is appropriate to make an exception for this policy for accounts totaling $445,500 for which written pledges have been received.

NOTE D - PROPERTY AND EQUIPMENT

Property and equipment at December 31, 2001 consists of the following:

Computer equipment	$336,343
Furniture and fixtures	44,195
Leasehold improvements	112,315
	492,853
Less: accumulated depreciation	206,980
	$285,873

NOTE E - LOANS PAYABLE

Note payable to USC/ISI for construction of leasehold improvements, dated April 1999, bearing interest at 8.0%, principal and interest payable in equal monthly installments of $647 through August 1, 2003.	$11,507
Note payable to USC/ISI for construction of leasehold improvements, dated July 28, 2000, bearing interest at 11%; principal and interest payable in equal monthly installments of $1,229 through September 1, 2003.	21,334
	$32,841

Scheduled principal payments on debt are as follows:

Period or year ended June 30
2002	$9,820
2003	23,021
	$32,841

NOTE F - COMMITMENTS AND CONTINGENCIES

Lease commitment- In January 1999, ICANN entered into a five-year sublease agreement for an office facility. Future minimum lease payments for the remaining term under the operating lease, including addendums, as of December 31, 2001 are as follows:

Period or year ended June 30
2002	$51,708
2003	103,415
2004	25,854
	$180,977

Rent and other facilities costs totaled $91,927 for the six months ended December 31, 2001.

Legal matters- In the ordinary course of business, ICANN is subject to lawsuits and other potential legal actions. In the opinion of management, such matters will not have a material effect on the financial position of ICANN.

NOTE G - TEMPORARILY RESTRICTED NET ASSETS

Temporarily restricted net assets totaling $162,694 at December 31, 2001 were restricted by donors for specific activities and projects pertaining to the Domain Name Supporting Organization.

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