NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012


Functional Allocation of Expenses


The costs of providing the various programs and other activities have been summarized on a functional basis in the accompany- ing schedule of functional expenses. Accordingly, certain costs have been allocated among programs and supporting services benefited based on salaries.


Use of Estimates


The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, 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.


Definition of Operations


Operating revenue and expenses generally reflect those revenues and expenses that management can influence and exclude earn- ings (losses) on investments and unusual transactions unrelated to the Commission’s ordinary activities.


2. Inventory The Commission’s inventory consisted of the following at December 31, 2012:


Emblem items Publications


Total Inventory


3. Investments The Commission’s investments consisted of the following as of December 31, 2012:


Mutual funds: Equity


Fixed-income Mutual Funds Subtotal


Money market funds Certificates of deposit


Exchange-traded products Total Investments


Net investment income consisted of the following for the year ended December 31, 2012: Interest and dividends


Realized losses Unrealized gains


Total Net Investment Income


$1,504,237 253,029


1,757,266 1,649,335 200,454 24,327


$3,631,382


$14,267 6,618


$20,885


$ 71,547 (34,760) 143,235 $180,022


Investment expenses totaled $10,748 for the year ended December 31, 2012. Interest earned on cash accounts totaling $630 is included in net investment income in the accompanying statement of activities.


Annual Report 2012


31


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