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Interior_Annual Report 13-10-30 4:32 PM Page 73


Years ended June 30, 2013 and 2012

PURPOSE OF THE ORGANIZATION (note 11(a)). The purpose of the fund is to manage the funding
and expenditures on the art collection (the “Collection”) of the
The Vancouver Art Gallery Association (the “Association”) is a Vancouver Art Gallery.
not-for-profit organization incorporated in April 1931 under the (iv) The Operating Capital Fund was established in 2012 for the
Society Act (British Columbia). Its objectives are to establish and purpose of accumulating and managing capital that is either
maintain an art gallery for the perpetual benefit of the City of raised through external contributions or internal funds and is
Vancouver and its citizens. It is a registered Canadian charity restricted expressly to be maintained for the purpose of meeting
for Canadian income tax purposes. future working capital or other contingency funding needs of the
On July 1, 2012, the Association adopted Canadian Accounting General Fund. Any funding provided by the Operating Capital
Standards for Not-For-Profit Organizations in Part III of the CICA Fund to the General Fund is recorded as an interfund balance
Handbook. These are the first financial statements prepared in to be repaid to the Operating Capital Fund. Any contributions
accordance with Not-For-Profit Standards. received specifically for this fund are considered to be held on
In accordance with the transitional provisions in Not-For-Profit a permanent basis as they are not available other than for the
Standards, the Association has adopted the changes retrospec- General Fund’s financing requirements. As a result, such con-
tributions are recorded as a direct increase to net assets.
tively, subject to certain exemptions allowed under these stan-
dards. The transition date is July 1, 2011 and all comparative In addition, the Life Benefactors Endowment Fund was initially
information provided has been presented by applying Not-For- established in 1989 and the income from the Fund is intended to
Profit Standards. finance special projects as determined by the Board of Trustees.
This fund is permanently restricted and administered by the
There were no changes to the statement of financial position at
July 1, 2011 resulting from the transition to the Not-For-Profit Vancouver Foundation as described in note 10 and is not included
Standards. in these financial statements.
There were no changes to the statement of operations, changes (b) Basis of accounting
in net assets, and cash flows from operating, financing, or invest- (i) Cash and cash equivalents:
ing for the year ended June 30, 2012 upon transition to the Not-
For-Profit Standards. Cash and cash equivalents consist of cash and highly liquid
investments with terms to maturity of three months or less at
the date of acquisition.
(ii) Short-term investments:
The financial statements have been prepared by management Short-term investments consist of highly liquid investments with
in accordance with Canadian Accounting Standards for Not-For- terms to maturity between three and twelve months at the date
Profit Organizations in Part III of the CICA Handbook and include of acquisition.
the following significant accounting policies:
(iii) Prepaid expenses and exhibition costs:
(a) Fund accounting The balance is comprised primarily of exhibition expenditures

These financial statements include the undernoted funds which that have been paid by the Association, which relate to exhibi-
are segregated for purposes of carrying on specific activities as tions to be held in subsequent years.
described below. (iv) Inventories:
(i) The General Fund reflects the results of general operations Inventories are comprised primarily of the following categories:
of the Association. (a) Books, jewellery, paper products, gifts, reproductions and
(ii) The Building Fund was established in 2008 for the express clothing held-for-sale in the Gallery Store that is stated at the
purpose of accumulating, managing and distributing funds to lower of cost and net realizable value. Cost is determined on a
plan, develop and build a new Vancouver Art Gallery (note 7(c)). weighted average basis.
(iii) The Acquisitions Fund was established in 1984 through funds (b) Owned artwork held-for-sale or rental in the Art Rental & Sales
from the sale of the original Georgia Street building and receives Department, where the Association is the title holder and ultimate
income earned by The Vancouver Art Gallery Endowment Fund beneficiary, is stated at the lower of cost and net realizable value.
for Acquisitions of Art. The Association also receives income Costs for inventories include all costs incurred in bringing inven-
from The Vancouver Art Gallery Foundation (the “Foundation”) tories to their present location and condition. Net realizable value
which has established several acquisition endowment funds is defined as the anticipated selling price less the costs to sell.

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