SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
FINANCIAL STATEMENTSYEARS ENDED MARCH 31, 2019 AND 2018

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
FOR THE YEARS ENDED MARCH 31, 2019 AND 2018

Table of Contents

Page
Independent Accountant's Review Report

1-2

Financial Statements
Statements of financial position

3

Statements of activities and changes in net assets

4Statement of functional expenses

5

Statements of cash flows

6

Notes to financial statements

7 - 16

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 statement of financial position as ofMarch 31, 2019, and the related statements of activities and changes in net assets, functional expenses
and cash flows for the year 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 whichis the expression 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.
Accountant's Conclusion
Based on our review, 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.

Summarized Comparative Information
We previously reviewed Sasakawa Peace Foundation USA, Inc.'s financial statements as of and for theyear ended March 31, 2018, and in our conclusion dated July 30, 2018, stated that based on our review,
we were not aware of any material modifications that should be made to the financial statements as ofand for the year ended March 31, 2018, in order for them to be in accordance with accounting
principles generally accepted in the United States of America. We are not aware of any material
modifications that should be made to the summarized comparative information presented herein on
page 5 for the year ended March 31, 2018, for it to be consistent with the reviewed financial statementsfrom which it has been derived.

Bethesda, Maryland
December 4, 20192

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENTS OF FINANCIAL POSITIONMARCH 31, 2019 AND 2018
2019

2018

1,123,763 $
110,670
26,911
20,62925,865849,102
16,846
126
76,042
20,781

Total current assets

1,307,838

962,897

Property and equipment, net

4,395,466

4,312,579

Other assets:
Deferred leasing commissions, net of accumulated amortization of$512,021 in 2019 and $439,142 in 2018
Restricted cash - tenant security deposits
Website development costs, net of accumulated amortization of$45,400 in 2019 and $42,697 in 2018

271,389
64,238303,204
64,186ASSETS
Current assets:
Cash and cash equivalents
Grants receivable
Accounts receivable
Tenant rents and other receivable
Prepaid expenses$-

Total other assets

2,703

335,627

370,093

6,038,931 $

5,645,569

291,261 $
15,08827,822
6,291
37,220-250,328
49,86624,232678
120,000

Total current liabilities

377,682

445,104

Long-term liabilities:
Deferred rent liabilities
Tenant security deposits

253,176
63,443278,933
63,443

Total long-term liabilities

316,619342,376

Total liabilities

694,301

787,480

5,344,630

4,858,089

6,038,931 $

5,645,569$

TOTAL ASSETSLIABILITIES AND NET ASSETS
Current liabilities:
Accounts payable
Credit card payable
Accrued vacation
Accrued taxes
Deferred income
Grant refundable$

Net assets without donor restrictions
TOTAL LIABILITIES AND NET ASSETS$

See independent accountant's review report and accompanying notes to financial statements.
3

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENTS OF ACTIVITIES AND CHANGES IN NET ASSETSFOR THE YEARS ENDED MARCH 31, 2019 AND 2018
2019

2018

2,819,222 $
1,841,419
351-

3,993,867
1,606,770
238
800

4,660,992

5,601,675

1,764,969
144,487
541,677
406,464
1,316,854

2,441,948
154,607
1,075,741
339,553
1,359,245

Total expenses

4,174,451

5,371,094

Change in net assets

486,541

230,581

Net assets without donor restrictions - beginning

4,858,089

4,627,508

5,344,630 $

4,858,089

Revenues:
Grant income
Rental income
Interest and dividends
Contributions$

Total revenues
Expenses:
Programs:
Policy research and education
JUMP
Other grants
General and administrative
Rental operations

NET ASSETS WITHOUT DONORRESTRICTIONS - ENDING$

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

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED MARCH 31, 2019
(WITH COMPARATIVE TOTALS FOR 2018)
Programs
PolicyResearch and
Education
Personnel
GrantsTravelDepreciation andamortization
Professional fees
Repairs and maintenanceTaxes and licenses
Meetings
Utilities
Communication anddelivery
Honorarium
Insurance
Payroll processing fees
Printing
Dues and subscriptions
Equipment rental
Office supplies
Miscellaneous$

TOTAL EXPENSES

JUMP

837,756 $
341,542

77,466 $17,081

5,114
214,883
29,977160,190
6,953

1,278
828
1,961
17,373
1,264

50,69948,043
7,770
12,632
17,561
15,127
10,4185,174
1,130

17,535
1,629
2,803
2,499
1,743
694
267
66

$ 1,764,969 $

144,487 $Grants$541,677-

Total
Programs

General and
Administrative

RentalOperations

Total

2018
Comparative
Totals915,222 $541,677
358,623

302,573 $
27,207281,183 $ 1,498,978 $ 1,929,374
541,677
1,075,741
385,830
422,583-

6,392
215,71131,938
177,563
8,217

15,465
16,712
4,873
16,6304,248
3,161

342,789
78,968219,213226,072782
127,683

364,646
311,391
256,024
242,702
182,593
139,061

345,193
347,144
310,329
233,544
222,509125,701-

68,23448,043
9,399
15,43520,06016,87011,112
5,441
1,196

2,697

932
27,534
1,238
794
369
496
8,801

71,86348,04339,66520,98020,06018,671
14,798
6,922
10,547

83,269116,030
40,137
20,30531,68529,375
13,28910,38014,506541,677 $2,451,133 $

2,732
4,307
1,007
3,317
985
550

406,464 $ 1,316,854 $ 4,174,451 $ 5,371,094

See independent accountant's review report and accompanying notes to financial statements.
5

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
STATEMENTS OF CASH FLOWSFOR THE YEARS ENDED MARCH 31, 2019 AND 2018
2019

2018

486,541 $

230,581364,646

345,193(93,824)(26,785)
55,413(5,084)(41,064)(52)
40,933(120,000)(34,778)
3,590
5,613
37,220(25,757)

83,712(77)(47,003)
22,789(111,902)
24,779148,236
120,000(52,130)(6,972)(1,028)(8,635)(15,357)

646,612732,186

Cash used in investing activities:
Acquisitions of property and equipment(371,951)(165,747)

Cash flows from financing activities:
Receipts of tenant security deposits
Repayments of tenant security deposits-

72,000(93,640)

Net cash used in financing activities-(21,640)

Net increase in cash and cash equivalents

274,661544,799

Cash and cash equivalents - beginning

849,102304,303

1,123,763 $

849,102

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
Changes in assets and liabilities:
Grants receivable
Accounts receivable
Tenant rents and other receivable
Prepaid expenses
Deferred leasing commissions
Restricted cash - tenant security deposits
Accounts payable
Grant refundable
Credit card payable
Accrued vacation
Accrued taxes
Deferred income
Deferred rent liabilities$

Net cash provided by operating activities

CASH AND CASH EQUIVALENTS - ENDING$

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

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
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
space in the building to unrelated commercial tenants and uses the income from therental 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 tostrengthening the U.S.-Japan relationship.
Grants - awarding grants to other organizations to strengthen the U.S.-Japan
relationship.

See independent accountant's review report.
7

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBasis of presentation
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.
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
donor-imposed restrictions are perpetual in nature, where the donor stipulates that
resources be maintained in perpetuity.
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.
At March 31, 2019 and 2018, the Foundation had no net assets with donor restrictions.
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 ofassets and liabilities and disclosures of contingent assets and liabilities at the date of thefinancial statements, and the reported amounts of revenues and expenses during thereporting period. Actual results could differ from those estimates.
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, 2019 and 2018, there were nocontributions of non-cash assets or contributed services meeting the requirements forrecognition in the financial statements.
See independent accountant's review report.
8

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Cash and cash equivalents
Cash and cash equivalents consist primarily of cash on deposit and money market
accounts that are readily convertible into cash.
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.
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 on a history of write-offs and collections and current credit conditions.
The Foundation charges off uncollected receivables when management determines thatit has exhausted all collection efforts. Management has determined that, at March 31,
2019 and 2018, all of its receivables were collectible, and that no allowance for doubtful
accounts was required.
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.
As a result of the enactment of the Tax Cuts and Jobs Act in 2017, effective January 1,
2018, the Foundation is subject to income tax on unrelated business income arisingfrom nontaxable qualified transportation benefits provided by the Foundation to its
employees. Income tax on unrelated business income activity amounted to $6,235 and$1,200 for the years ended March 31, 2019 and 2018, respectively.
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, 2019 and 2018, management has determined that the Foundation had no uncertain
tax positions that qualified for either recognition or disclosure in the financial
statements.
See independent accountant's review report.
9

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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, 2019 and 2018, amortization of the leasing
commissions totaled $72,879 and $60,842, respectively.
Website development costs
The Foundation classifies and accounts for costs incurred for website development inthree stages. During the initial or planning stage, the costs incurred are expensed. Costs
incurred during the second or development stage are capitalized and then amortizedwhen the website is ready for its intended use. The third stage consists of postimplementation activity and adding additional upgrades and features. Postimplementation costs are expensed as incurred; costs incurred for additional upgrades
and features once the website is launched are capitalized if the upgrades andenhancements furnish additional functionality; otherwise, they are expensed as incurred.
The Foundation amortizes its capitalized website development costs over three years
using the straight-line method. During the years ended March 31, 2019 and 2018,
amortization expense related to capitalized website development costs totaled $2,703
and $8,203, respectively.
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 five 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
sold or retired, their cost and related accumulated depreciation are removed from theaccounts and any gain or loss reported in the statements of activities.
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
the carrying value exceeded the estimated fair value of the asset. Management
determined that there was no impairment to its long-lived assets during the years ended
March 31, 2019 and 2018.

See independent accountant's review report.
10

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Reclassifications
Certain amounts in the prior year financial statements have been reclassified to conformto the current year presentation. These reclassification adjustments had no effect on theFoundation's previously reported change in net assets.
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 andchanges in net assets.
The statement 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.
The expenses that are allocated include the following:
ExpenseSalaries and employee benefits
General administration

Method of Allocation
Time and effort
Time and effort

General administration expenses include those expenses that are not directly identifiablewith a specific function, but that provide for the overall support and directions for theFoundation.
Recently adopted accounting pronouncement
On August 18, 2016, FASB issued Accounting Standards Update ("ASU") No. 2016-14,
Not-for-Profit Entities (Topic 958) – Presentation of Financial Statements of Not-for-Profit Entities.
The update addresses the complexity and understandability of net asset classification,
deficiencies in information about liquidity and availability of resources, and the lack ofconsistency in the type of information provided about expenses and investment return.
The Foundation has adjusted the presentation of these statements accordingly. The
ASU has been applied retrospectively, with elective reliefs on analysis of expenses byfunction and nature, and disclosures about liquidity and availability of resources forperiods presented before the period of adoption.
Recently issued but not yet effective accounting pronouncements
In February 2016, FASB issued ASU No. 2016-02, Leases ("ASU 2016-02"). FASB also
issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases and ASU No. 201811, Leases: Targeted Improvements in July 2018, and ASU No. 2018-20, Narrow-Scope
Improvements for Lessors in December 2018. These updates provide narrow amendments
to clarify how to apply certain aspects of the new leases standard and options regardingtransition and lessor accounting for lease and non-lease components. This option will
not require prior periods to be restated at the adoption date and an option for lessors, if
certain criteria are met, to avoid separating the lease and nonlease components (such as
preventative maintenance services) in an agreement. In addition, an election for lessors
to exclude sales and related taxes from consideration in the contract, requires lessors to
exclude from revenue and expense lessor costs paid directly to a third party by lessees,
See independent accountant's review report.
11

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Recently issued but not yet effective accounting pronouncements (continued)
and clarifies lessors' accounting for variable payments related to both lease and nonlease
components. ASU 2016-02, as amended, is effective for fiscal years beginning after
December 15, 2019, and the Foundation is evaluating the effect, if any, on its financial
statements and related disclosures.
In August 2016, FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230) Classification of Certain Cash Receipts and Cash Payments ("ASU 2016-15"), which provides
guidance on several cash flow classification issues. This new guidance is effective foryears beginning after December 15, 2018, with early adoption permitted. The
Foundation does not anticipate that the adoption of ASU 2016-15 will have a material
effect on its financial statements and related disclosures.
In November 2016, FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230):
Restricted Cash (a consensus of the Emerging Issues Task Force) ("ASU 2016-18"), which
requires an entity to present restricted cash and cash equivalents together withunrestricted cash and cash equivalents in the statement of cash flows. Under ASU 201618, an entity will be required to disclose in the financial statements how the statement ofcash flows reconciles to the statement of financial position, if restricted cash and cash
equivalents are presented separate from unrestricted cash and cash equivalents on thestatement of financial position, and the nature of restrictions at the statement offinancial position date. This new guidance is effective for years beginning after
December 15, 2018, with early adoption permitted. Upon adoption of the amendments
in ASU 2016-18, the Foundation will present within the statement of cash flows thechange during the period in total cash and cash equivalents, including amounts generally
described as restricted cash and cash equivalents. The amendments will be applied
retrospectively.
In June 2018, FASB issued ASU No. 2018-08, Clarifying the Scope and Accounting Guidance
for Contributions Received and Contributions Made ("ASU 2018-08"), which provides guidancefor determining whether a transaction should be accounted for as a contribution or an
exchange transaction, and whether a contribution is conditional or unconditional. ThisASU is effective for years beginning after December 15, 2018. The Foundation does not
anticipate that the adoption of ASU 2018-08 will have a material effect on its financial
statements and related disclosures.
In May 2014, FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic
606), as amended (commonly referred to as "ASC 606"), which requires an entity torecognize revenue to depict the transfer of promised goods or services to customers in
an amount that reflects the consideration to which the entity expects to be entitled in
exchange for those goods or services. ASC 606 replaces most existing revenue
recognition standards in U.S. GAAP, including industry-specific guidance, when it
becomes effective. For annual reporting periods, this standard is effective for theFoundation on April 1, 2019, and for interim periods within annual periods that begin
one year later. The standard permits the use of either the retrospective or cumulativeeffect transition method. The Foundation is currently completing its initial assessmentand evaluation of the impact that ASC 606 will have on the Foundation's financial
statements and related disclosures.
See independent accountant's review report.
12

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Recently issued but not yet effective accounting pronouncements (continued)
The Foundation expects, at minimum, the adoption will require expanded disclosuresthat will enable users to better understand the nature, amount, timing, and uncertainty,
if any, of revenues and cash flows arising from contracts with customers.
Subsequent events
Management has evaluated subsequent events through December 4, 2019, the date on
which these financial statements were available to be issued. There were no material
subsequent events that required recognition or additional disclosure in these financial
statements.

NOTE 3.

LIQUIDITY AND AVAILABILITY
As of March 31, 2019, the following financial assets could readily be made available
within one year of the statement of financial position date to meet general expenditures:
Cash
Grants and other receivable
Financial assets available to meet general
expenditures within one year$

1,123,763
158,210$

1,281,973

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. Please refer to theaccompanying statements of cash flows which identify the sources and uses of theFoundation's cash and show positive cash generated by operations for the year ended
March 31, 2019.
The Foundation manages its liquidity and reserves 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 30 days ofoperating expenses.

See independent accountant's review report.
13

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 4.

PROPERTY AND EQUIPMENTThe Foundation's property and equipment consisted of the following at March 31, 2019and 2018:
2019
Land
Building and improvements
Furniture and equipment
Total costLess: accumulated depreciation
Property and equipment, net

2018$ 1,200,000 $ 1,200,000
6,554,591
6,188,890
158,341
153,380
7,912,932

7,542,270

3,517,466

3,229,691$ 4,395,466 $ 4,312,579

Depreciation expense was $289,064 and $276,148 for the years ended March 31, 2019and 2018, respectively.
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, 2019 and 2018, the Foundation received grants totaling$2,536,065 and $3,673,867, respectively, from SPF-Japan (Tokyo) to assist with
operating activities. Grants receivable from SPF-Japan (Tokyo) were $27,537 and$16,972 at March 31, 2019 and 2018, respectively.

See independent accountant's review report.
14

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 6.

RENTAL INCOME
The Foundation is the lessor of commercial space under operating leases expiring
periodically through 2026. 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, 2019, are as follows:Year ending March 31:
2020
2021
2022
2023
2024
Thereafter

Amount$ 1,625,065
1,280,526
1,148,256
650,848257,277
395,067$ 5,357,039

The Foundation's board of directors has approved that the rental income be applied tofund current operations of the Foundation.
At March 31, 2019 and 2018, the cost of the property subject to rental operations
amounted to $7,754,591 and $7,388,890, respectively. At March 31, 2019 and 2018, theaccumulated depreciation for the rental property amounted to $3,403,959 and$3,135,057, respectively.
NOTE 7.

GRANTSThe Foundation awarded the following grants during the years ended March 31, 2019and 2018, to support projects with a purpose to promote dialogue and strengthen the
U.S.-Japan relationship:
Strengthening the U.S.-Japan Relationshipfrom U.S. Perspectives$
JUMP
Other grants
Total

$

2019

2018

69,032 $89,056
383,589

127,729
76,393871,619541,677 $ 1,075,741

See independent accountant's review report.
15

SASAKAWA PEACE FOUNDATION USA, INC.
(A Nonprofit Organization)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 7.

GRANTS (CONTINUED)
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 eight and twelve grant recipients for the years ended March 31, 2019 and 2018,
respectively.
JUMP - Two grants, for each of the years ended March 31, 2019 and 2018, wereawarded to organize events and networking activities in the United States andYokosuka, Japan, for Americans who have served or are serving in the U.S. militaryin Japan to update them on U.S.-Japan relations and enhance their ties to Japan.
Other grants - Grants were awarded to support projects to organize events anddelegation trips to Japan for congressional members and staff. There were two grantrecipients for each of the years ended March 31, 2019 and 2018.

NOTE 8.

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
were $706,375 and $508,562 as of March 31, 2019 and 2018, respectively.
The Foundation receives rental income from office space leased in Washington, D.C.,
and is subject to the normal fluctuations and risk associated with the real estate market
in this area.
The Foundation receives a significant portion of its grant income from SPF-Japan(Tokyo) (see Note 5).

NOTE 9.

FEDERAL EXCISE TAXThe Foundation is subject to federal excise tax on net investment income. During theyears ended March 31, 2019 and 2018, the Foundation earned net investment income of$499,161 and $247,763, respectively. Federal excise tax incurred during the years ended
March 31, 2019 and 2018, amounted to $9,983 and $2,478, respectively.
Additionally, the Code requires minimum qualifying distributions of funds related totheir exempt purpose. During the years ended March 31, 2019 and 2018, theFoundation made qualifying distributions of $3,067,715 and $3,953,811, respectively,
which were in excess of the minimum distributable amounts of $743,194 and $767,357,
respectively. The Code allows for excess distributions to be carried forward to reducethe minimum distributions required in future years. At March 31, 2019, the Foundation
had excess distribution carryforwards of $14,805,306.

NOTE 10.

RETIREMENT PLAN
The Foundation has a defined contribution 401(k) plan. Substantially all employees are
eligible to participate. The Foundation made contributions of $29,844 and $40,376 forthe years ended March 31, 2019 and 2018, respectively.
See independent accountant's review report.
16