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SMITHSONIAN INSTITUTION 



Notes to Financial Statements 



September 30, 2000 



($ millions) 



Permanently restricted 



Net assets subject to donor-imposed stipulations that the principal be maintained 

 permanently by the Smithsonian. Generally, the donors of these assets permit the 

 Smithsonian to use all or part of the income earned on investment of the assets for either 

 general or donor-specified purposes. 



Revenues from sources other than contributions are reported as increases in unrestricted net 

 assets. Contributions are reported as increases in the appropriate category of net assets. 

 Expenses are reported as decreases in unrestricted net assets. Gains and losses on investments 

 are reported as increases or decreases in unrestricted net assets, unless their use is restricted by 

 explicit donor stipulations or by law. Expiration of temporary restrictions on net assets (i.e., the 

 donor stipulation has been fulfilled and/or the stipulated time period has elapsed) are reported as 

 reclassifications from temporarily restricted net assets to unrestricted net assets. 



(d) Cash and Cash Equivalents 



Short-term investments with maturities at date of purchase of three months or less (except those 

 purchased with funds held by external investment managers) are considered cash equivalents. At 

 September 30, 2000, cash equivalents consisted of a repurchase agreement of $3.3. 



(e) Contributions 



Contributions, including unconditional promises to give, are recognized as revenues in the period 

 received. Conditional promises to give are not recognized until the conditions on which they 

 depend are substantially met. Contributions of assets other than cash are recorded at their 

 estimated fair value at the date of gift, except that contributions of items held as part of the 

 Smithsonian's collections are not capitalized. Contributions restricted to the acquisition of 

 long-lived assets are recorded as temporarily restricted revenue in the period received. The 

 donor's restrictions expire and the related net assets are released from restriction when the 

 long-lived asset is placed in service 



Contributions receivable are reported net of estimated uncollectible amounts determined based 

 on management's judgment and analysis of the creditworthiness of donors, past collection 

 experience and other relevant factors. Contributions expected to be collected beyond one year 

 are discounted to present value using a risk-free rate for the expected period of collection. 



In-kind contributions of goods and services totaling $7.6 were received in fiscal year 2000 and 

 recorded as program support in the accompanying statement of financial activity. In-kind 

 contributions include donated space, equipment and various other items. 



A substantial number of volunteers also make significant contributions of time to the 

 Smithsonian, enhancing its activities and programs. In fiscal year 2000, more than 5,800 

 volunteers contributed approximately 449,000 hours of service to the Smithsonian. The value of 

 these contributions is not susceptible to objective measurement and, accordingly, is not 

 recognized in the financial statements. 



