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i 6 HOMELESS ASSISTANCE CENTER, INC . Notes to Financial Statements The Organization follows SFAS No . 136 , Transfers of Assets to a Not-for-Profit- Organization or Charitable Trust That Raises or Holds Contributions for Others, which requires that cash or other financial assets the Organization receives from a donor and agrees to hold and subsequently transfer to another organization, are recognized at fair value as liabilities instead of contribution revenue . In addition, grants and donations held by others on behalf of the Organization are recorded as contributions in the period they are determined . (c) Cash Equivalents For purposes of the statements of cash flows , the Organization considers all highly liquid debt instruments purchased with original maturities of three months or less to be cash equivalents . (d) Property and Equipment Property and equipment are recorded at cost for purchased items and fair value for contributed items . Maintenance, repairs , and minor renewals are charged to expense as incurred. Depreciation is provided using the straight-line method over the estimated lives indicated below. Years Buildings and improvements ' 30 Leasehold improvements 30 Vehicles 7 Furniture and fixtures 7 Computer equipment 5 (e) Use of Estimates 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 the reported amounts of assets and liabilities and disclosure of contingent 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 . (� Concentrations of Credit Risk Financial instruments that potentially subject the Organization to concentrations of credit risk consist principally of cash investments , pledges receivable, and assets restricted to investment in building fund. Cash balances maintained in financial institutions may at times be in excess of the FDIC limit. The Organization has not experienced any losses on such amounts and does not believe it is exposed to any significant risk with respect to such balances . (Continued)