Arts Council ran on artists’ credit cards

The IN has obtained more financial reports of the Arts Council of Northwest Florida. The October 2009 Profit & Loss report that was given to the Board of Directors showed that the Arts Council ran that month primarily on “Credit Card Pass Through” ($8,710.63) and funds taken from the Kobacker Foundation ($5,500).

The P&L report only shows $2,798.86 being paid out to artists and for processing fees from the $8,710.63 that was taken in. The Kobacker Foundation grant is earmarked for the Cinco Banderas collection, but there are no expenditures for that art collection on that report.

Arts Council of Northwest Florida
Profit & Loss
Oct. 1-30, 2009

Cinco Banderas $5,500.00
Credit Card Pass Through $8,710.63
Escambia Arts Tags $260.00
State of Arts Luncheon $600.00
Individual Contributions $50.00
Artists memberships $100.00
Total Income: $15220.63

Credit Card fees & materials $281.15
Credit Card Pass Through $2,517.71
Total Credit Pass Through expense: $2,798.86

Telephone $233.57
Salaries/Landrum $8,608.34
Uncategorized Expenses $15.59
Unrealized losses $1,619.49 —-I don’t know what this is, maybe Merrill Lynch losses
Total expenses $13,275.85

Net income $1,944.76

It gets worse. The Balance Sheet that was given to the Board of Directors showed the BB&T bank account overdrawn $24,330.29. The Arts Council does have other assets: Art Collection (Cinco Banderas?) book value $53,610, Computers (net book value) $11,161.31 and Merrill Lynch investment accounts $18,231.17.

Arts Council of Northwest Florida
Balance Sheet
as of Oct. 30, 2009

Checking acct. ($24,330.29)
Receivable: State of Arts $500
Receivable: Gallery Nights $3,574.04
Receivable: Memberships $3,376.50
Merrill Lynch accts: $18.231.17
Paypal membership: $279.59

Total current assets: $1,631.01

Fixed Assets
Art Collection: $53,610.00
Computers, less accumulated depreciation: $11,161.31

Total Fixed Assets: $64,771.31

Total Assets: $66,402.32

BB&T Line of Credit: $19,373.36

Net Retained Earnings: $45,084.19
Oct. 2009 Net Income: $1,944.78

Total Equity: $47,028.96

Total Liabilities & Equity: $66,402.32

The Balance Sheet shows the liquidity problem of the Arts Council. Even if it cashed in all its investment accounts and collected all its memberships, the Arts Council could not cover its overdrafts and pay off its line of credit–falling short $17,742.35. Adding to the misery is the $28,000 that the Arts Council owes the City and County, according to the Clerk of Courts audit report.

Also, I don’t see anything for the credit card monies owed to the artists.

If the Arts Council can sell its Art Collection and computers, it may be able to cover all its debts.