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i Hibiscus Children ' s Center, Inc . INOTES TO FINANCIAL STATEMENTS June 30 , 2002 NOTE A we DESCRIPTION OF ORGANIZATION IHibiscus Children ' s Center, Inc . (the Center) is a Florida not-for-profit corporation organized to construct and operate a facility to provide temporary shelter for abused and neglected children . The organization was incorporated on September 11 , 1985 and the shelter Iopened in October 1989 . NOTE B - SUMMARY OF SIGNIFICANT ACCOUNT/NG POLICIES IA summary of the significant accounting policies consistently applied in the preparation of the accompanying financial statements follows : I1 . Fund Accounting To ensure observance of limitations and restrictions placed on the use of resources I available to the Center, the accounts of the Center are maintained in accordance with the principles of fund accounting . This is the procedure by which resources are classified for accounting and reporting into funds established according to their I nature and purpose and in accordance with activities or objectives specified by donors . In accordance with Statement of Financial Accounting Standards ( SFAS ) No . 117 , " Financial Statements of Not-for-Profit Organization , " fund balances and transactions have been classified into three classes of net assets - unrestricted and temporarily restricted as follows : I a . Unrestricted - Represents the portion of expendable funds that are available for support of operations . I b . Temporarily Restricted - Represents the portion of expendable funds that are restricted by the grantor or donor as to the way they may be utilized . The Center primarily uses this fund for various grant funds received . IAll contributions/donations are considered available for unrestricted use unless specifically restricted by the donor . Contributions/donations are I considered temporarily restricted if a donor imposes a restriction that may be satisfied by the passage of time or the actions of the organization . A permanently restricted contribution /donation stipulates that the contribution/donation be maintained permanently but may allow the organization to use all or part of the income derived from the underlying asset for unrestricted purposes . When a donor restriction expires , that is , I when a stipulated time restriction ends or purpose restriction is accomplished , temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statement of activities as net assets released from restrictions . I I IPage 7