The statement of activities for the ECE Children€™s Learning Center for fiscal year 2020, prepared by a newly hired budget employee with no NFP experience, is presented below.

Required
a. Because you are taking a not-for-profit course, a friend who sits on the board of the ECE has asked you to review its statement of activities. Your friend has a concern about the statement because it doesn€™t look quite the same as it did last year. Given that the ECE opted to hire someone without NFP experience, your friend has concerns that the statement may not be properly presented. Make a list of modifications or corrections that you believe should be made to the statement to ensure it is presented in conformance with GAAP.
b. Your friend indicates that the center is facing an upcoming audit. What concern would you have for the ECE regarding its audit, based on the financial statement it has prepared?

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ECE CHILDREN'S' LEARNING CENTER Statement of Activities For the Period Ended June 30, 2020 Without With Donor Donor Restrictions Restrictions Total Revenues: $ 732,000 $ 732,000 2$ Admission fees Special events revenue 125,000 125,000 554,450 Program fees 150,000 704,450 839,770 Contributions 792,320 1,632,090 50,000 Grants 50,000 955 214,163 Investment income 213,208 3,457,703 Total revenues 2,254,725 1,202,978 Expenses: Center for creativity 947,173 582,834 1,530,007 Outdoor experiences 522,297 311,854 834,151 603,337 Management & fund-raising 603,337 Depreciation Total expenses 10,735 2,083,542 10,735 894,688 2,978,230 Decrease in net assets 171,183 308,290 479,473 Beginning net assets 798,011 2,534,012 3,332,023 $3,811,496 $ 969,194 $2,842,302 Ending net assets