CREATIVE COMMONS CORPORATION(A NONPROFIT CORPORATION)DECEMBER 31, 2016

INDEPENDENT AUDITORS’ REPORTAND

CONSOLIDATED FINANCIAL STATEMENTS

Creative Commons Corporation
Independent Auditors’ Reportand Consolidated Financial Statements

Independent Auditors’ Report

1-2

Consolidated Financial Statements

Consolidated Statement of Financial Position

3

Consolidated Statement of Activities and Change in Net Assets

4Consolidated Schedule of Functional Expenses - 2016

5Consolidated Statement of Cash Flows

6Notes to Consolidated Financial Statements

7 - 10Independent Auditors’ Report
THE BOARD OF DIRECTORSCREATIVE COMMONS CORPORATIONMOUNTAIN VIEW, CALIFORNIA
Report on the Consolidated Financial Statements
We have audited the accompanying consolidated financial statements of CREATIVE COMMONSCORPORATION (the Corporation) which comprise the consolidated statement of financial position asof December 31, 2016, and the related consolidated statements of activities and change in net assets,functional expenses and cash flows for the year then ended and the related notes to the consolidated
financial statements.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial
statements in accordance with accounting principles generally accepted in the United States of America;
this includes the design, implementation, and maintenance of internal control relevant to the preparationand fair presentation of consolidated financial statements that are free from material misstatement,
whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States ofAmerica. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the consolidated financial statements are free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the consolidated financial statements. The procedures selected depend on the auditor’s judgment,
including the assessment of the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error. In making those risk assessments, the auditor considers internal control
relevant to the Corporation’s preparation and fair presentation of the consolidated financial statements inorder to design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express nosuch opinion. An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of significant accounting estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements.

275 BATTERY STREET, SUITE 900
SAN FRANCISCO, CA 94111
415.781.0793

60 SOUTH MARKET STREET, SUITE 200
SAN JOSE, CA 95113
408.998.8400

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion.
OpinionIn our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the financial position of the Corporation as of December 31, 2016 and the changes in its net
assets and its cash flows for the year then ended in accordance with accounting principles generally
accepted in the United States of America.

San Francisco, California
October 23, 2017

2Creative Commons Corporation
Consolidated Statement of Financial Position

December 31, 2016
AssetsCash and cash equivalents
Grants and federal funds receivable
Prepaid expenses and other assets$

Total assets

9,681,208
1,118,135
81,640$ 10,880,983

Liabilities and Net Assets
Liabilities
Accounts payable
Accrued expenses$

Total liabilities

95,484
230,721326,205

Net Assets:
Unrestricted
Temporarily restricted

8,871,213
1,683,565

Total net assets

10,554,778

Total liabilities and net assets$ 10,880,983

See accompanying notes to consolidated financial statements.
3Creative Commons Corporation
Consolidated Statement of Activities and Change in Net Assets

For the Year Ended December 31, 2016
TemporarilyRestricted

Unrestricted
Revenues:
GrantsContributions
In-kind contributions
Dividend income
Foreign currency translation loss
Net realized and unrealized gain
on investments
Satisfaction of Program Restrictions$ 10,323,791
439,597
16,257101(1,321)

Total revenues
Expenses:
Program services:
Supporting services:Management
Fundraising
Total expenses
Change in Net Assets
Net Assets - beginning of yearNet Assets - end of year$$

1,801,599

1,283
1,216,948(1,216,948)

11,996,656

584,651$ 12,125,390
439,597
16,257101(1,321)
1,283

12,581,307

2,520,161

2,520,161

391,465454,391

391,465454,391

3,366,017

3,366,017

8,630,639

584,651

9,215,290

240,574

1,098,914

1,339,488

1,683,565$ 10,554,778

8,871,213$

See accompanying notes to consolidated financial statements.
4TotalCreative Commons Corporation
Consolidated Statement of Functional Expenses

For the Year Ended December 31, 2016
Program Services

Education
SalariesPayroll Taxes
Employee Benefits$Project Support
Consulting and Design
Travel and Conferences
Occupancy
Legal Fees
Board Cultivation & MeetingsSpecial Events
Insurance
Telephone
Publicity and Communication
Supplies
Accounting Fees
WebsiteLicenses & Fees
Technology
Bank Charges
Printing
Training
Membership and Dues
Recruiting
Taxes

Total expenses$439,613
27,80161,547

International
Affiliates$

99,731
6,307
13,963$

LegalTechnology

129,796
8,208
18,172$

191,549
12,114
26,817

Supporting Services

Science$

74,551
4,715
10,437

Culture$Total
ProgramServices

248,863
15,73834,841$ 1,184,103
74,883165,777

Management
andGeneral$

206,698
13,07228,938

Fund
Raising$219,674
13,89230,755$

Total
Supporting
Services

2016
Total
Expenses

426,372
26,964
59,693$ 1,610,475
101,847
225,470

528,961

120,001

156,176

230,480

89,703

299,4421,424,763

248,708

264,321513,029

1,937,792

113,308
116,689
1,360
5,203
425
10,64416,086
2,419
2,916
767
9,727
14,961
399
10,613
5,578
2,017
1,672
1,222
871
1,417

23,628226,665
26,472
309
1,180
96
2,415
3,649
549
661
174
2,207
3,394
91
2,408
1,265
458
379
277
198
321

28,431
34,452
402
1,536
125
3,143
4,749
714
861
227
2,872
4,417
118
3,133
1,647
596
494
361
257
418

158,896
50,844
593
2,267
185
4,638
7,009
1,054
1,271
334
4,238
6,519
174
4,624
2,431
879
728
532
380
617

(2,532)
19,788
231
882
72
1,805
2,728
410
494
130
1,650
2,537
68
1,800
946
342
283
207
148
240

(5,127)
66,057
770
2,945
240
6,026
9,106
1,369
1,651
434
5,506
8,469
226
6,008
3,158
1,142
946
692
493
802

23,628519,641
314,302
3,665
14,013
1,143
28,671
43,327
6,515
7,854
2,066
26,20040,297
1,076
28,58615,025
5,434
4,502
3,291
2,347
3,815

46,11654,865
639
2,446
200
5,005
7,563
1,137
1,371
1,328
4,573
7,034
188
4,990
2,623
948
786
574
410
(39)

87,63858,309
680
2,600
212
5,319
8,038
1,209
1,457
384
4,861
7,476
200
5,303
2,787
1,008
835
611
435
708

133,754
113,174
1,319
5,046
412
10,324
15,601
2,346
2,828
1,712
9,434
14,510388
10,293
5,410
1,956
1,621
1,185
845
669

23,628653,395
427,476
4,984
19,0591,555
38,99558,928
8,861
10,682
3,778
35,63454,807
1,464
38,87920,435
7,390
6,123
4,476
3,192
4,484

318,294

296,796

88,953

248,21332,229110,913

1,095,398

142,757

190,070

332,827

1,428,225

410,355$ 2,520,161

845,856$ 3,366,017

847,255$

416,797$245,129$

478,693$

121,932$$

See accompanying notes to consolidated financial statements.
5391,465$

454,391$

Creative Commons CorporationStatement of Cash Flows

For the Year Ended December 31, 2016
Cash Flows from Operating Activities:
Change in net assets
Adjustments to reconcile change in net assets to net cash
provided by operating activities:
Net realized and unrealized loss on investments
Dividends reinvested
Discount on pledges receivable
Change in operating assets and liabilities:
Grants and federal funds receivable
Contributions receivable
Prepaid expenses
Accounts payable
Accrued expenses$9,215,290(1,283)(101)
17,007(817,503)
204,250(40,605)
4,407
38,542

Net cash provided by operating activities

8,620,004

Net Increase in Cash

8,620,004

Cash and Cash Equivalents, beginning of year

1,061,204

Cash and Cash Equivalents, end of year

$See accompanying notes to consolidated financial statements.
69,681,208

Creative Commons CorporationNotes to the Consolidated Financial Statements

Note 1 -Organization:
Creative Commons Corporation (Creative Commons) is a Massachusetts nonprofit
corporation that develops, supports, and stewards legal and technical infrastructure thatmaximizes digital creativity, sharing, and innovation. Because it can be expensive andburdensome to secure legal permission to use a copyrighted work published to the Web,
Creative Commons provides a set of free copyright licenses and public domain tools thatenable everyone to grant copyright permissions to their creative works so that they can belegally used by others. Creative Commons’ public domain tools allow creators to waive allrights to a work and place it in the public domain, or to mark a work that is already in thepublic domain.
Creative Commons enables scientific research and innovation by enabling open accessjournals and the open exchange of scientific data. When a CC license is applied to a journal
or scientific data, the journal and data can be freely reused by others. Creative Commons’licenses and public domain tools are also used to make data and databases freely available.
The CCO public domain dedication tool is used to remove all copyright restrictions.
Creative Commons also provides the legal infrastructure that powers Open Educational
Resources (OER). OER are free resources that are developed by institutions, communities,
and individuals to further universal access to education. Creative Commons’ licenses enableeducational materials to be translated for use around the world. Creative Commons is also
developing software and metadata standards to improve search and discovery of educational
resources.
Creative Commons licenses and tools have been developed in consultation with legal experts
and Creative Commons affiliate institutions in over 85 jurisdictions. Over 1 billion Creative
Commons-licensed works have been published by authors on the Internet.
In 2012, a Canada subsidiary, 0941176 B.C. LTD, was established to enable Creative
Commons to engage the services of Canadian-based individuals. Creative Commons is thesole shareholder of the subsidiary. A management services agreement is in place between theorganizations and provides the structure for provision of those services to Creative Commonsby the subsidiary through its employees and its operations are reported in the consolidated
financial statements.

7

Creative Commons CorporationNotes to the Consolidated Financial Statements

Note 2 -Summary of Significant Accounting Policies
a. Basis of Accounting
The accompanying consolidated financial statements have been prepared on the accrualbasis of accounting in accordance with U.S. generally accepted accounting principles.
b. Basis of Presentation
Creative Commons reports information regarding its financial position and activities
according to three classes of net assets: unrestricted net assets, temporarily restricted net
assets, and permanently restricted net assets.
Unrestricted Net Assets – the portion of net assets that is neither temporarily nor
permanently restricted by donor-imposed stipulations. These net assets are intended foruse by management and the Board of Directors for general operations.
Temporarily Restricted Net Assets – the portion of net assets the use of which is limitedby donor-imposed stipulations that either expire by passage of time or can be fulfilled andremoved by actions of the Corporation.
Permanently Restricted Net Assets – the portion of net assets the use of which is limitedby donor-imposed stipulations that neither expire by passage of time nor can be removedby actions of the Corporation. The Corporation has no permanently restricted net assets.
c. Estimates
Management uses estimates and assumptions in preparing consolidated financialstatements. Those estimates and assumptions affect the reported amounts of asset andliabilities, the disclosure of contingent assets and liabilities, and the reported revenues
and expenses. Actual results could differ from those estimates.
d. Cash and Cash Equivalents
For purposes of the statement of cash flows, Creative Commons considers all unrestricted
highly liquid investments with an initial maturity of three months or less to be cashequivalents.

8

Creative Commons CorporationNotes to the Consolidated Financial Statements

e. Revenue Recognition
Unconditional promises to give are recognized upon receipt and are recorded as increases
in unrestricted, temporarily restricted, or permanently restricted net assets, depending on
the existence and/or nature of any donor restrictions. When a donor-specified restriction
expires (that is when a stipulated time restriction ends or purpose restriction isaccomplished), the temporarily restricted net assets are reclassified to unrestricted netassets.
Unconditional contributions receivable are recorded at net realizable value if expected tobe collected in one year and at fair value if expected to be collected in more than oneyear. No allowance for uncollectible receivables has been recorded based on
management’s evaluation of collections.
At December 31, 2016, all receivables are due within one year.
Grants and contract revenue is recorded when earned.
f.

Income Taxes
Creative Commons is exempt from income taxes under Internal Revenue Section
501(c)(3). Creative Commons qualifies for the charitable contribution deduction underSection 170(b)(1)(A) and has been classified as an organization that is not a private
foundation under Section 509(a)(1).
Creative Commons recognizes the effect of income tax positions only if those positions
are more than not to be sustained. Management continuously evaluates tax positions
reflected in the Creative Commons’ tax filings and does not believe that any material
uncertain tax positions exist.
Creative Commons’ federal and state income tax returns are generally subject toexamination by federal and state taxing authorities for three and four years, respectively,after filing.

g. Functional Expense Allocations
Costs of providing programs and other activities are accumulated into separate groupings
as either direct or indirect. Indirect or shared costs are allocated to the programs andsupporting services by a method which best measured the relative degree of benefit.
Accordingly, certain costs have been allocated between the program and the supporting
services in reasonable ratios determined by management.

9Creative Commons Corporation
Notes to the Consolidated Financial Statements

Note 3 -Concentrations of Risk:
Creative Commons maintains cash balances at several financial institutions which from time
to time exceed federally insured limits.

Note 4 -Temporarily Restricted Net Assets:
Restricted as to purpose and time as of December 31, 2016:

Note 5 -Support for DOE Open Education Resource
Librarians for the 21st Century
Learning Resource Metadata Initiative
International Network Development
Sponsorship for 2017 Global Summit$101,914
144,242
144,202
1,168,207
125,000

Total$ 1,683,565

Pension Plan:
Creative Commons has a Tax Sheltered Annuity under IRC Section 403(b), which allows all
employees to contribute through payroll deductions. Creative Commons provides
discretionary matching contributions of 5% of annual salary for all employees who work 20
hours or more per week. Creative Common’s contributions made during the year ending
December 31, 2016 totaled $84,302.

Note 6 -Subsequent Events:
Creative Commons has evaluated subsequent events with respect to the consolidated financial
statements for the year ended December 31, 2016 through October 23, 2017, the date these
consolidated financial statements were available to be issued. There were no material
subsequent events that required recognition or additional disclosure in these consolidated
financial statements, other than what is noted below.

10