SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
FINANCIAL STATEMENTSYEARS ENDED MARCH 31, 2022 AND 2021

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
FOR THE YEARS ENDED MARCH 31, 2022 AND 2021

Table of Contents

Page
Independent Accountant's Review Report1

Financial Statements
Statements of financial position

2Statements of activities

3

Statements of functional expenses

4-5Statements of cash flows

6-7

Notes to financial statements

8 - 17

INDEPENDENT ACCOUNTANT'S REVIEW REPORTTo the Board of Directors
Sasakawa Peace Foundation USA, Inc.
We have reviewed the accompanying financial statements of Sasakawa Peace Foundation USA, Inc. (anonprofit organization) (the "Foundation"), which comprise the statements of financial position as ofMarch 31, 2022 and 2021, and the related statements of activities, functional expenses, and cash flows
for the years then ended, and the related notes to the financial statements. A review includes primarily
applying analytical procedures to management's financial data and making inquiries of Foundation
management. A review is substantially less in scope than an audit, the objective of which is theexpression of an opinion regarding the financial statements as a whole. Accordingly, we do not express
such an opinion.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements inaccordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fairpresentation of financial statements that are free from material misstatement whether due to fraud or
error.
Accountant's Responsibility
Our responsibility is to conduct the review engagements in accordance with Statements on Standards
for Accounting and Review Services promulgated by the Accounting and Review Services Committeeof the AICPA. Those standards require us to perform procedures to obtain limited assurance as a basis
for reporting whether we are aware of any material modifications that should be made to the financial
statements for them to be in accordance with accounting principles generally accepted in the UnitedStates of America. We believe that the results of our procedures provide a reasonable basis for ourconclusion.
We are required to be independent of Sasakawa Peace Foundation USA, Inc. and to meet our otherethical responsibilities, in accordance with the relevant ethical requirements related to our reviews.
Accountant's Conclusion
Based on our reviews, we are not aware of any material modifications that should be made to theaccompanying financial statements in order for them to be in accordance with accounting principles
generally accepted in the United States of America.

Bethesda, Maryland
October 31, 2022

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENTS OF FINANCIAL POSITIONMARCH 31, 2022 AND 2021
2022

2021

3,212,393 $9,396,563
25,372
67,2885,742
273

1,547,002
9,582,288
5,290
163,558
344,664
33,384
947

Total current assets

12,707,631

11,677,133

Property and equipment, net

4,246,581

4,466,651

Other assets:
Deferred leasing commissions, net of accumulated amortization of$742,768 in 2022 and $676,057 in 2021
Deferred rent assets
Restricted cash - tenant security deposits

115,064
144,51328,333

164,992
65,383287,910230,375

17,242,122 $

16,374,159

23,343 $20,78843,88435,8791,122,380

39,8783,088
36,262
34,790386,047

Total current liabilities

1,246,274

500,065

Long-term liabilities:
Deferred rent liabilities
Tenant security deposits

28,33325,181
40,99828,333

66,1791,274,607

566,244

6,570,952
9,396,563

6,225,627
9,582,288

15,967,515

15,807,915

17,242,122 $

16,374,159

ASSETS
Current assets:
Cash and cash equivalents
Restricted cash - endowment fund
Grants receivable
Accounts receivable
Tenant rents and other receivable
Prepaid expenses
Prepaid taxes$

Total other assets$

TOTAL ASSETSLIABILITIES AND NET ASSETS
Current liabilities:
Accounts payable
Credit card payable
Accrued vacation
Deferred income
Refundable advances$

Total long-term liabilities
Total liabilities
Commitments and contingencies (Note 13)
Net assets:
Without donor restrictions
With donor restrictions
Total net assets
TOTAL LIABILITIES AND NET ASSETS$

See independent accountant's review report and accompanying notes to financial statements.
2

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENTS OF ACTIVITIESFOR THE YEARS ENDED MARCH 31, 2022 AND 2021

Without
Donor
Restrictions
Revenues:
Contribution income
Rental income
Interest and dividends
Other income
Net assets released from purpose restrictions

1,618,822 $
1,652,166
290
46,214
190,517

Total support revenue

3,508,009

Expenses:
Programs:
Policy research and education
JUMP
Grants1,201,932
146,398
189,321

Total programs
General and administrative
Rental operations

With Donor
Restrictions$

2021
With Donor
Restrictions

Total(190,517)

1,461,531 $
2,045,748
346
1,644
-

9,580,293 $
1,995-

11,041,824
2,045,748
2,341
1,644
-

(185,725)

3,322,284

3,509,269

9,582,288

13,091,557-

1,201,932
146,398
189,321959,626
110,500
159,653-

959,626
110,500
159,653

1,537,651
334,036
1,290,997-

1,537,651
334,036
1,290,997

1,229,779
350,405
1,475,369-

1,229,779
350,405
1,475,369

Total expenses

3,162,684-

3,162,684

3,055,553-

3,055,553

Change in net assets

345,325(185,725)

159,600

453,716

9,582,288

10,036,004

Net assets - beginning

6,225,627

9,582,288

15,807,915

5,771,911-

5,771,911

6,570,952 $

9,396,563 $ 15,967,515 $

$

-

Total

Without
Donor
Restrictions

1,618,822 $
1,652,166
5,082
46,214-

NET ASSETS - ENDING

$

2022

4,792

6,225,627 $See independent accountant's review report and accompanying notes to financial statements.
3

9,582,288 $ 15,807,915

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED MARCH 31, 2022
Programs
PolicyResearch and
Education

JUMP

Grants

Total
Programs

General and
Administrative

RentalOperations

Total

Personnel
Assistance provided to others
TravelDepreciation and amortization
Professional fees
Repairs and maintenanceTaxes and licenses
Meetings
Utilities
Communication and delivery
Honorarium
Insurance
Payroll processing fees
Printing
Dues and subscriptions
Equipment rental
Office supplies
Miscellaneous$

852,352 $
87,402
17,35180,076
32,663
16,223
3,570
39,79419,8008,653
15,131
4,969
9,558
8,618
5,351
421

75,344 $10,878
5,059
2,375
1,931
18,800833
17,342
3,000
1,030
1,883
4,946
1,824
509
623
21

$
189,321-927,696 $
189,321
98,28022,41082,451
34,59435,023
4,403
57,13622,8009,683
17,014
9,915
11,382
9,127
5,974
442

243,357 $1,428
24,12732,880
4,022
6,711
6,391
1,012
4,166
330
2,603
3,862
54
1,129
1,055
667
242

TOTAL EXPENSES$ 1,201,932 $

146,398 $

189,321 $1,537,651 $

334,036 $ 1,290,997 $ 3,162,684

See independent accountant's review report and accompanying notes to financial statements.
4

264,061 $ 1,435,114
189,32130
99,738323,115369,652
125,628
240,959
165,213203,829
250,224
256,935
19
41,433
113,590
119,005
13,87575,177
23,13031,38743,673
1,883
22,7599,969
107
12,618
10,182
1,001
7,642
864
1,548

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED MARCH 31, 2021
Programs
PolicyResearch and
Education

JUMP

Grants

Total
Programs

General and
Administrative

RentalOperations

Total

Personnel
Assistance provided to others
TravelDepreciation
Professional fees
Repairs and maintenanceTaxes and licenses
Meetings
Utilities
Communication and delivery
Honorarium
Insurance
Payroll processing fees
Printing
Dues and subscriptions
Equipment rental
Office supplies
Miscellaneous$

720,150 $
26,364
10,06944,14832,071
7,795
3,149
54,97018,9508,885
12,988
1,100
8,845
6,007
3,875
260

76,540 $
768
2,517
975
2,299
735
19,838
1,055
2,095
2,528
400
737
13

$
159,653-

796,690 $
159,653
27,132
12,58645,12334,3707,795
3,884
74,80818,9509,940
15,083
1,100
11,373
6,407
4,612
273

226,145 $520
12,587
58,684
6,134
12,239
1,765
892
9,582
1,191
4,691
40
1,137
1,702
12,846250

TOTAL EXPENSES$

959,626 $

110,500 $159,653 $1,229,779 $

350,405 $ 1,475,369 $ 3,055,553

See independent accountant's review report and accompanying notes to financial statements.
5298,234 $ 1,321,069
159,653
36
27,688358,105
383,278
98,577202,384
279,332
319,836
279,975
292,214162
9,722
100,198
104,97425
84,415
18,95052,47863,6091,732
21,506
1,140
725
13,235
8,109
1,195
18,653
4,595
5,118

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENTS OF CASH FLOWSFOR THE YEARS ENDED MARCH 31, 2022 AND 2021
2022

2021

159,600 $10,036,004

369,652-

383,278(9,580,293)(20,082)
163,558
277,376
27,642674(16,783)(144,513)(16,536)736,334
17,7007,622
1,089(25,181)

113,517(161,473)(319,860)
54,754
6,827(22,661)(383,164)
386,046(15,222)
15,41917,509(137,674)

1,538,152

393,007

Cash used in investing activities:
Acquisitions of property and equipment(82,871)(297,542)

Cash flows from financing activities:
Endowment fund contributions
Repayments of tenant security deposits(12,665)

9,580,293(13,953)

Net cash provided by (used in) financing activities(12,665)

9,566,340

Net increase in cash, cash equivalents and restricted cash

1,442,616

9,661,805

Cash, cash equivalents and restricted cash - beginning

11,194,673

1,532,868

12,637,289 $

11,194,673

Cash flows from operating activities:
Change in net assets
Adjustments to reconcile change in net assets to
net cash provided by operating activities:
Depreciation and amortization
Endowment fund contributions
Changes in assets and liabilities:
Grants receivable
Accounts receivable
Tenant rents and other receivable
Prepaid expenses
Prepaid taxes
Deferred leasing commissions
Deferred rent assets
Accounts payable
Refundable advances
Credit card payable
Accrued vacation
Deferred income
Deferred rent liabilities$

Net cash provided by operating activities

CASH, CASH EQUIVALENTS AND
RESTRICTED CASH - ENDING$

See independent accountant's review report and accompanying notes to financial statements.
6

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENTS OF CASH FLOWSFOR THE YEARS ENDED MARCH 31, 2022 AND 2021
Reconciliation of cash, cash equivalents and restricted cash:
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported
within the statements of financial position that sum to the total of the same such amounts shown in thestatements of cash flows:
2022
2021
Cash and cash equivalents
Restricted cash - endowment fundRestricted cash - tenant security deposits
Total cash, cash equivalents and restricted cash shown instatements of cash flows$

3,212,393 $9,396,563
28,333

1,547,002
9,582,288
65,383$

12,637,289 $

11,194,673

See independent accountant's review report and accompanying notes to financial statements.
7

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 1.

ORGANIZATION AND NATURE OF BUSINESS
Sasakawa Peace Foundation USA, Inc. (the "Foundation") was incorporated on
September 24, 1990, as a not-for-profit private foundation and commenced operationsin March 1991. The Foundation is dedicated to strengthening U.S.-Japan relations
through education, programs and research. To foster this mission, the Foundation's
research programs focus on security, diplomacy, economics, business, trade, technology
and other matters of common concern. The Foundation's education programs aredesigned to facilitate people-to-people exchange and dialogue on these issues with
American and Japanese policymakers, influential citizens and the broader public.
Upon its formation, the Foundation received a grant from its founder, the Sasakawa
Peace Foundation Japan ("SPF-Japan"), to acquire a building in Washington, D.C. tohouse a library of research, survey and other noncommercial publications, and an art
gallery dedicated for the purpose of fostering a better understanding of contemporary
Japan in the United States. After extensive renovations to the property, the Foundation
opened the library and art gallery on December 2, 1992. In October 1996, after
reevaluating its activities, the Foundation terminated the art gallery operations andinitiated new programs to promote better understanding and dialogue between the
United States and Asia. The library operations were discontinued during 2014, and therelated assets were donated to other educational and charitable organizations.
Subsequently, the Foundation expanded its research, educational, and grant programs
on U.S.-Japan relations with additional grants. The Foundation is currently renting spacein the building to unrelated commercial tenants and uses the income from the rental
activities to maintain the building and support the Foundation's activities.
A description of the significant program activities of the Foundation are as follows:
Policy Research and Education - addressing issues of importance to the United States andJapan requiring greater attention, coordination and cooperation; organizing programs
that improve understanding of U.S.-Japan relations in the United States throughdialogue, exchanges and outreach; engaging the American public through the news
media and the Foundation's own social media.
Japan-U.S. Military Program ("JUMP") - conducting seminars, conferences, andoutreach through social media to inform and connect Americans who have served orare serving in the U.S. military in Japan to facilitate their contributions to strengthen
the U.S.-Japan relationship.
Grants - awarding grants to organizations to support projects promoting dialogue andstrengthening the U.S.-Japan relationship.
Congressional Engagement - engaging with Congress to build a greater understanding of
the U.S.-Japan relationship through legislative exchange programs conducted by theCongressional Study Group on Japan and Congressional Program on U.S.-Japan andthe Indo-Pacific, a semester-long certificate program to educate U.S. Congressional
staffers on important issues in Asia that affect the United States.

See independent accountant's review report.
8

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBasis of accounting
The financial statements of the Foundation have been prepared in accordance withaccounting principles generally accepted in the United States of America ("U.S.
GAAP"), which require the Foundation to report information regarding its financial
position and activities according to the following net assets classifications:
Net assets without donor restrictions - Net assets available for use in general operations
and not subject to donor (or certain grantor) restrictions. The governing board has
designated, from net assets without donor restrictions, net assets for various
purposes, see Note 9.
Net assets with donor restrictions - Net assets subject to donor-imposed restrictions.
Some donor-imposed restrictions are temporary in nature, such as those that will
be met by the passage of time or other events specified by the donor. Other donorimposed restrictions are perpetual in nature, where the donor stipulates that
resources be maintained in perpetuity. Donor-imposed restrictions are released
when a restriction expires, that is, when the stipulated time has elapsed, when the
stipulated purpose for which the resource was restricted has been fulfilled, or both.
The Foundation reports contributions restricted by donors as increases in net assets
without donor restrictions if the restrictions expire (that is, when a stipulated time
restriction ends or purpose restriction is accomplished) in the reporting period in which
the revenue is recognized. All other donor-restricted contributions are reported asincreases in net assets with donor restrictions, depending on the nature of therestrictions. When a restriction expires, net assets with donor restrictions are reclassified
to net assets without donor restrictions and reported in the statements of activities as
net assets released from restrictions.
Cash and cash equivalents
Cash and cash equivalents consist primarily of cash on deposit and money market
accounts that are readily convertible into cash.
Receivables
Receivables consist of grant commitments, expense reimbursements and tenant-related
income and are stated at the amounts that management expects to collect. Management
evaluates such receivables and establishes an allowance for doubtful accounts based ona history of write-offs and collections and current credit conditions. The Foundation
charges off uncollected receivables when management determines that it has exhausted
all collection efforts. Management has determined that at March 31, 2022 and 2021, allof its receivables were collectible, and that no allowance for doubtful accounts was
required.

See independent accountant's review report.
9

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Revenue recognition
The Foundation recognizes rental revenue on the straight-line basis over the terms of
the respective leases. Revenue from contributions and grants is recognized as income
when it is unconditionally promised. Revenue from conditional grants is recognizedwhen the Foundation has complied with substantially all of the conditions set forth in
the grant agreement.
Contributions of non-cash assets are recorded at their fair values in the period received.
Contributions of services that create or enhance non-financial assets or that require
specialized skills, are provided by individuals possessing those skills, and would typicallyneed to be purchased if not provided by donation, are recorded at their fair values in the
period received. For the years ended March 31, 2022 and 2021, there were nocontributions of non-cash assets or contributed services meeting the requirements forrecognition in the financial statements.
Property and equipment
Acquisitions of property and equipment, including improvements and replacements, arerecorded at cost. Depreciation is provided using the straight-line method over theestimated useful lives of 5 to 39 years for buildings and improvements and three toseven years for furniture and equipment. Maintenance and repairs that do not improveor extend the lives of the assets are charged to expense as incurred. When assets are soldor retired, their cost and related accumulated depreciation are removed from theaccounts and any gain or loss reported in the statements of activities.
As construction commenced, project costs were included in the "construction inprogress" account and consisted of materials, labor, and other direct overhead costs.
Long-lived assets
Management assesses whether indicators of impairment of long-lived assets, such as
property, equipment and intangible assets, are present. If such indicators are present,
recoverability of these assets is determined based upon expected undiscounted future
net cash flows from the operations to which the assets relate utilizing management's
best estimates, appropriate assumptions and projections at the time. If the carrying value
is determined not to be recoverable from future operating cash flows, the asset would
be deemed impaired and an impairment loss would be recognized to the extent thecarrying value exceeded the estimated fair value of the asset. Management determinedthat there was no impairment to its long-lived assets during the years ended March 31,
2022 and 2021.
Restricted cash
Tenant security deposits are held in a separate bank account in accordance withapplicable state laws and disbursed in accordance with the lease agreements.
Cash received as endowment contribution from donor (see Note 9) is maintained in a
separate restricted cash account at a financial institution.

See independent accountant's review report.
10

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Income taxes
The Foundation is classified as a private foundation as described in Section 501(c)(3) of
the Internal Revenue Code (the "Code") and is exempt from federal income taxes on its
exempt income under Sections 509(a)(3) and 170(b)(1)(A)(vi) of the Code.
Contributions to the Foundation are deductible to the extent permitted by law. The
Foundation is subject to certain excise taxes on any net investment income. The
Foundation is also exempt from the District of Columbia's income and franchise,personal property, and sales and use taxes.
Uncertain tax positions
The Foundation follows accounting requirements associated with uncertainty in income
taxes using the provisions of Financial Accounting Standards Board AccountingStandards Codification ("FASB ASC") 740, Income Taxes. Using that guidance, tax
positions initially need to be recognized in the financial statements when it is more likely
than not that the positions will be sustained upon examination by the taxing authorities.
It also provides guidance for derecognition, classification, interest and penalties,
accounting in interim periods, disclosure and transition.
The Foundation files income tax returns in the U.S. federal jurisdiction. As of March
31, 2022 and 2021, management has determined that the Foundation had no uncertain
tax positions that qualified for either recognition or disclosure in the financial
statements.
Deferred leasing commissions
Deferred leasing commissions consist of commissions due to the property managementcompany for locating tenants for the Foundation's rental property. Such costs areamortized over the terms of the respective lease agreements using the straight-line
method. For the years ended March 31, 2022 and 2021, amortization of the leasing
commissions totaled $66,711 and $80,235, respectively.
Refundable advances
Transfers of assets that are conditional contributions are recorded as refundable
advances until the conditions have been substantially met or explicitly waived by thedonor.
Functional allocation of expenses
The costs of providing the Foundation's various programs and supporting services havebeen summarized on a functional basis in the accompanying statements of activities.
The Foundation incurs expenses that directly relate, and can be assigned, to a specificprogram or supporting activity. The Foundation also conducts a number of activities
which benefit both its program objectives as well as supporting services.
The statements of functional expenses presents the natural classification detail of
expenses by function. Accordingly, certain expenses have been allocated among the
programs and supporting services benefited.
See independent accountant's review report.
11

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Functional allocation of expenses (continued)
The expenses that are allocated include the following:
ExpenseSalaries and employee benefits
General administrative
Depreciation and amortization
Occupancy expenses

Method of Allocation
Time and effort
Time and effort
Square footage
Square footage

Use of estimates
The preparation of financial statements in conformity with U.S. GAAP requires
management to make estimates and assumptions that affect the reported amounts anddisclosures in the financial statements. Actual results could differ from those estimates.
Recently issued but not yet effective accounting pronouncements
LeasesIn February 2016, FASB issued Accounting Standards Update ("ASU") No. 2016-02,
Leases (Topic 842) ("ASU 2016-02"). The amendments to the ASU revise the accounting
related to lessee accounting. Under the new guidance, lessees will be required torecognize a lease liability and a right-of-use asset for all leases. In June 2020, FASB
issued ASU No. 2020-05, Revenue from Contracts with Customers (Topic 606) and Leases (Topic
842) ("ASU 2020-05"). ASU 2020-05 provided for the deferral of the effective date for
ASU 2016-02 and related amendments for an additional year. As a result, ASU 2016-02
will be effective for the Foundation beginning on April 1, 2022, with early adoption
permitted, and should be applied through a modified retrospective transition approach
for leases existing at, or entered into after, the beginning of the earliest comparative
period presented in the financial statements.
Contributed nonfinancial assets
In September 2020, FASB issued ASU No. 2020-07, Presentation and Disclosures by Not-forProfit Entities for Contributed Nonfinancial Assets (Topic 958) ("ASU 2020-07"). ASU 2020-07
requires a not-for-profit organization to present contributed nonfinancial assets as aseparate line item in the statements of activities, apart from contributions of cash andother financial assets. ASU 2020-07 is effective for annual periods beginning after June15, 2021, and interim periods within annual periods beginning after June 15, 2022. Early
adoption is permitted and should be applied on a retrospective basis.
Reclassifications
Certain accounts in the 2021 financial statements were reclassified for comparative
purposes to conform with the presentation in the 2022 financial statements. Total
assets, liabilities, net assets, and net loss are unchanged due to these reclassifications.
Subsequent events
Subsequent events have been evaluated through October 31, 2022, the date on whichthese financial statements were available to be issued.
See independent accountant's review report.
12

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 3.

LIQUIDITY AND AVAILABILITY
As of March 31, 2022 and 2021, the following financial assets could readily be madeavailable within one year of the statements of financial position date to meet general
expenditures:
2022
2021
Financial assets at year end:
Cash and cash equivalents$
3,212,393 $
1,547,002
Restricted cash - endowment fund
9,396,563
9,582,288
Grants receivable
25,372
5,290
Accounts receivable
163,558
Tenant rents and other receivable
67,288344,664
Total financial assets at year end

12,701,616

11,642,802

Less: amounts not available to be
used within one year:
Net assets with donor restrictions

9,396,563

9,582,288

3,305,053 $2,060,514

Financial assets available to meet general
expenditures within one year$

For the purposes of analyzing resources available to meet general expenditures, theFoundation considers all expenditures related to its ongoing activities of policy research,education, grant commitments, rental operations, as well as the conduct of services
undertaken to support those activities to be general expenditures. In addition tofinancial assets available to meet general expenditures, the Foundation operates with abalanced budget and anticipates collecting sufficient revenue to cover general
expenditures not covered by donor-restricted resources.
The Foundation manages its liquidity and reserves by following three guiding principles:
operating within a prudent range of financial soundness and stability, maintaining
adequate liquid assets to fund near-term operating needs, and maintaining sufficient
reserves to provide reasonable assurance that long-term obligations will be discharged.
The Foundation's goal is generally to maintain financial assets to meet at least 30 days ofoperating expenses.
NOTE 4.

PROPERTY AND EQUIPMENTThe Foundation's property and equipment consisted of the following at March 31, 2022
and 2021:
2022
2021
Land
Building and improvements
Furniture and equipment
Total costLess: accumulated depreciation
Property and equipment, net$ 1,200,000 $ 1,200,000
7,202,842
7,132,576
265,977
253,3728,668,819

8,585,948

4,422,238

4,119,297$ 4,246,581 $ 4,466,651

Depreciation expense was $302,941 and $303,043 for the years ended March 31, 2022
and 2021, respectively.
See independent accountant's review report.
13

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 5.

FOUNDING GRANT AND ONGOING SUPPORTIn March 1991, the Foundation received an initial grant from SPF-Japan (Tokyo) in theamount of $21,655,122 for the purpose of acquiring an office building at 1819 L Street
in Washington, D.C. The building was acquired in May 1991 at a cost of $19,074,660.
The remaining proceeds were used to renovate the building and to fund the initial
operations of the Foundation.
In 1996, the Foundation recorded an impairment loss on the building in the amount of$14,630,058, as management determined that the carrying amount of the property
exceeded the estimated future cash flows expected to be received from the operationsof the property.
For the years ended March 31, 2022 and 2021, the Foundation recognized grant revenue
totaling $1,427,620 and $1,313,954, respectively, from SPF-Japan (Tokyo) to assist with
operating activities. As of March 31, 2022 and 2021 there was no grants receivable from
SPF-Japan (Tokyo).

NOTE 6.

RENTAL INCOME
The Foundation is the lessor of commercial space under operating leases expiring
periodically through 2027. Certain of the lease agreements include renewal periods at
the Foundation's option, as well as rent holidays and scheduled rent increases. Rental
income is recognized on the straight-line method over the terms of the respective leases.
Future minimum lease payments expected to be received under the existing leases at
March 31, 2022, are as follows:Year ending March 31:
2023
2024
2025
2026
2027

Amount$ 1,238,519
739,480
536,755
342,328
151,990$ 3,009,072

The Foundation's board of directors has approved the use of rental income to fundcurrent operations of the Foundation.
At March 31, 2022 and 2021, the cost of the property subject to rental operations
amounted to $8,402,842 and $8,332,576, respectively. At March 31, 2022 and 2021, theaccumulated depreciation for the rental property amounted to $4,240,763 and$3,961,279, respectively.

See independent accountant's review report.
14

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 7.

GRANTSThe Foundation awarded the following grants during the years ended March 31, 2022
and 2021, to support projects with a purpose to promote dialogue and strengthen the
U.S.-Japan relationship:
2022

2021

Strengthening the U.S.-Japan Relationshipfrom U.S. Perspectives$
JUMP
Other grants

33,378 $50,632
105,31127,30240,02892,323$

189,321 $

159,653

Total

The following are descriptions of the grants awarded by the Foundation:
Strengthening the U.S.-Japan Relationship from U.S. Perspectives - Grants were awarded toorganize programs and offer opportunities for students, policy experts, congressional
staff and practitioners to learn more about, and strengthen their ties to, Japan. There
were two and three grant recipients for the years ended March 31, 2022 and 2021,
respectively.
JUMP - Grants were awarded to organize events and networking activities in the
United States and Yokosuka, Japan for Americans who have served or are serving in
the U.S. military in Japan to update them on U.S.-Japan relations and enhance theirties to Japan. There were three and two grant recipients for the years ended March
31, 2022 and 2021, respectively.
Other grants - Grants were awarded to support projects to organize events anddelegation trips to Japan for congressional members and staff. There was one grantrecipient for each of the years ended March 31, 2022 and 2021.
NOTE 8.

NET ASSETS
Net assets with donor restrictions
As of March 31, 2022 and 2021, net assets with donor restrictions subject toexpenditure for specific purpose are available for the following program:

Endowment restricted by donor for:Strengthening the U.S.-Japan Relationship in
partner with The Nippon Foundation

$

2022

2021

9,396,563 $

9,582,288

See independent accountant's review report.
15

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 9.

ENDOWMENT FUNDSThe Foundation's endowment consists of funds received from The Nippon Foundation
on October 29, 2020, which are donor-restricted but not in perpetuity. This endowment
was established to support the Foundation's program to strengthen the U.S.-Japan
relationship within the Asia-Pacific context, placing emphasis on security anddiplomacy, through exchanges, dialogue, research, and networking. In accordance with
U.S. GAAP, net assets associated with endowment funds are classified and reported
based on the existence or absence of donor-imposed restrictions.
The interest and dividends earned on the endowment funds are to be used for theoperation of the program, as specified by the donor.
During the year ended March 31, 2021 the Foundation received a grant in the amountof $ 9,580,293. An analysis of changes in endowment funds for the years ended March
31, 2022 is as follows:
Without Donor
Restrictions
Endowment net assets March 31, 2021
Investment return, net
Amounts appropriated for
expenditure
Endowment net assets March 31, 2022$-

With Donor
Restrictions
$

$

-

$

Total

9,582,288 $
4,792

9,582,288
4,792(190,517)(190,517)

9,396,563 $

9,396,563

Spending policy and use of endowment
The Foundation shall appropriate for use the endowment and its interest and/or
dividends solely for the purpose of enhancing program function to deepen theunderstanding and strengthen the relationship between the U.S. and Japan within the
Asia-Pacific context.
Risk parameter
The endowment is administered by an outside professional investment firm and resides
in a separate account.
Endowment activity
Utilizing the endowment funds the Foundation launched a program “US-Japan NEXT
Alliance Initiative.” US-Japan NEXT Alliance Initiative in October 2021. Through thisproject, the Foundation worked to connect US-Japan policy makers and issue area
specialists via five in-person, virtual, and hybrid roundtable events related to economic
security and bilateral defense cooperation for the year ended March 31, 2022. The
Foundation also composed not-for-attribution summaries of the roundtables forbroader dissemination, and published six volumes of the bi-weekly US-Japan Alliance
Digest. During the years ended March 31, 2022 and 2021 the project incurred costs of$190,517 and $- respectively.
See independent accountant's review report.
16

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2022 AND 2021
NOTE 10.

CONCENTRATIONSThe Foundation places its cash and cash equivalents, which may at times be in excess ofFederal Deposit Insurance Corporation ("FDIC") insurance limits of up to $250,000,
with high credit quality financial institutions. The amounts in excess of FDIC insurance
limits were $11,890,028 and $10,378,775 as of March 31, 2022 and 2021, respectively.
The Foundation receives rental income from office space leased in Washington, D.C.,
which is subject to the normal fluctuations and risk associated with the real estatemarket in this area.
The Foundation received a significant portion of its grant income from SPF-Japan(Tokyo) (see Note 5) and The Nippon Foundation (see Note 9).

NOTE 11.

FEDERAL EXCISE TAXThe Foundation is subject to federal excise tax on net investment income. During theyears ended March 31, 2022 and 2021, the Foundation earned net investment income of$349,549 and $435,046, respectively. Federal excise tax incurred during the years ended
March 31, 2022 and 2021, amounted to $4,859 and $6,047, respectively. At March 31,
2022 and 2021, prepaid taxes amounted to $273 and $947, respectively.
Additionally, the Code requires minimum qualifying distributions of funds related totheir exempt purpose. During the years ended March 31, 2022 and 2021, theFoundation made qualifying distributions of $1,763,485 and $1,565,650, respectively,
which were in excess of the minimum distributable amounts of $1,123,503and$1,236,340, respectively. The Code allows for excess distributions to be carried forward
to reduce the minimum distributions required in future years. At March 31, 2022, theFoundation had excess distribution carryforwards of $8,864,015.

NOTE 12.

RETIREMENT PLAN
The Foundation has a defined contribution 401(k) plan. Substantially all employees are
eligible to participate. The Foundation made contributions of $29,910 and $26,286 to
the plan for the years ended March 31, 2022 and 2021, respectively.

NOTE 13.

RISK AND UNCERTAINTYCOVID-19
During 2020, the World Health Organization declared the outbreak of a strain ofcoronavirus ("COVID-19") to constitute a "Public Health Emergency of International
Concern." In 2021 and 2020, the COVID-19 pandemic impacted the Foundation's
operations as the need for office space has declined significantly. However theFoundation's operations have grown during the latter part of the pandemic as thefoundation was able to obtain a large grant and expand operations in a remote work
environment as needed. No adjustments or provisions were made in these financial
statements related to COVID-19.

See independent accountant's review report.
17