RA 2006 abrinq.indd - Fundação Abrinq

5 Advances for ProjectsThese are amounts which had been received in advance from sponsors in connection withthe following projects and programs:2006 2005“Nossas Crianças” - Our Children 4,588,126 1,777,813“Prefeito Amigo da Criança” - Mayor as Friend of Children 2,743,642 3,449,207“Crer para Ver” - Believe to See 1,279,679“Empresa Amiga da Criança” - Business as Friend of Children 607,633 550,118“Cidadania Jovem” - Young Citizen 149Hewlett Packard 5,904“Mudando a História” - Changing History 53,003 361,690“Garagem Digital” - Digital Garage 752,580 731,417“Virada de Futuro” - Changeover of the Future 301,095 420,573“Biblioteca Viva” - Living Library 249,878 406,557“Geração Jovem” - Young Generation 89,098“Prêmio Criança” - Child Award 105,361 34,612“Observatório da Criança” - Child Observatory 228,081 84,915“Combate as Piores Formas de Trabalho Infantil- CPFTI” - Combat of the Worst Forms of Child Labor 146,327 154,636“Projetando a Vida” - Projecting Life 43,283 64,653“Adotei um Sorriso” - Adopt a Smile 50,199“Seminário Internacional” - International Seminar 682“Presidente Amigo da Criança” - President as Friend of Children 84,144“Orçamento Criança”- Public Budget for Children 1,579“Petrobras Jovem Aprendiz” - Petrobras Young Apprentice 36,484“Empreendedorismo Juvenil e Microcrédito” -Youngsters’ Entrepreneurshipand Microcredit 252,97110,245,068 9,411,021The account “Advances for projects” is comprised of funds from the programs and projectsinvested in fixed income funds in the amount of R$ 10,074,061 (2005 - R$ 9,350,147),cash in the amount of R$ 7,672 (2005 - R$ 15,765) and current account balances in theamount of R$ 163,335 (2005 - R$ 45,109).6 Net Worth(a) Liquidation and dissolutionFundação Abrinq will be liquidated upon a resolution supported by its Board Members,with the presence of the Public Attorney’s Office, approved by 2/3 of its members, when anyof the following occurs:incapacity of maintaining the Foundation;the continuity of activities does not meet the public and social interest;the illegality or uselessness of its purposes.In the event of liquidation, its residual net worth will be fully transferred to another entitywith similar purposes.(b) Retained surplus (deficit)The retained surplus will be used only to further the aims of the Foundation, which arechild and adolescent welfare. The deficit will be absorbed by the net worth.(c) Prior-year adjustmentsIn 2006, prior-year adjustments were identified, which related to the rectification of theappropriation of income from projects, in the amount of R$ 2,356,944.7 Contingencies(a) COFINSSince the tax authorities have understood that the financial income, including that of exemptentities, should be taxed by COFINS, the Foundation records a provision of R$ 277,521(2005 - R$ 170,455) referring to non-payments from 2002 to 2006.(b) IRRFThe Foundation obtained an injunction to prevent financial institutions from withholdingincome tax at source on its financial income as from 1999. The mentioned charge isnot recorded in the financial statements because the chance of loss is considered remote,based on management analysis supported by its legal advisors. The estimated amount oftax unpaid at December 31, 2006, for which no provision has been made, is R$ 2,383,000(2005 - R$ 1,943,000), including interest.(c) Social Security Contribution to INSS - employers’ contributionIn July 2005 the Foundation’s Certificate for Entities with Philanthropic Purposes grantedby the National Council for Social Welfare (CNAS) expired; this certificate exempts theFoundation from the payment of the INSS Employer’s Contribution. According to the lettersent by the Institute of National Social Security, the Foundation filed during the period thecorrect request for renewal, which is under analysis by CNAS and, if approved, will be validfor three years, as from the effective date. The Foundation’s management expects to receivethis certificate, therefore, it did not set up a provision for the payment of this charge.Taxes and contributions calculated and paid by the Foundation are open to review by theauthorities for various prescriptive periods, according to specific legislation.8 Gratuitous servicesThe beneficiaries, which are members of the low-income population, mainly children andadolescents, do not pay anything for the service received.76