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Home My WebLink About2009-08 Mt Ashland Review Report I RICHARD W. BREWSTER, CPA, PC CERTIFIED PUBLIC ACCOUNTANT 670 SUPERIOR COURT, # 106 MEDFORD, OREGON 97504 (541) 773-1885' FAX (541) 770-1430 VWoIW.rNbrewstercpa.com August 5, 2009 To the Board of Directors Mt. Ashland Association dba Mt. Ashland POBox 220 Ashland, OR 97520 I have reviewed the financial statements of the Mt. Ashland Association, dba Mt. Ashland (a non-profit organization) for the year ended June 30, 2009 and have issued my report thereon dated August 5, 2009. My Responsibility under Statements on Standards for Accounting and Review Services As stated in my engagement letter dated May 27,2009, a review consists principally of inquiries of management and analytical procedures applied to financial data, A review is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the basic financial statements taken as a whole. Accordingly, I did not express such an opinion. A review of financial statements in accordance with the Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants does not contemplate a review of the internal control. Although I noted no material weaknesses which would warrant disclosure in the reviewed financial report, I do believe improvements can be made to the existing system to increase efficiency by modifying current accoun1ing policies and procedures. Discussions of these recommendations for improvements are contained in the following paragraphs, Fraud Risk Assessment The opportunity to commit and conceal fraud exists where there are assets susceptible to misappropriation and inadequate controls to prevent or detect the fraud. I recommend that the Organization perform a risk assessment to identify, analyze, and manage the risk of asset misappropriation, The Organization's internal control should include performance of this assessment. Fraud risk assessment can be informal and performed by a management.level individual who has extensive knowledge of the Organization, Ordinarily, the management-level individual would conduct interviews or lead group discussion with personnel who have extensive knowledge of the Organization, its environment, and its processes, The fraud risk assessment process should consider the Organization's vulnerability to misappropriation of assets. . . Mt. Ashland Association, dba Mt. Ashland Page Two Statement of Functional Expenses I recommend that a time study be performed to determine the correct allocation of various expenses between the functional categories of management and general, fund raising, and program services. Only employees whose time is spent among more than one category need to participate in the study, The Executive Director and other employees whose time is spent in a wide variety of activities, should prepare a time sheet for one week out of each quarter of the year and detail where their time is spent. This data would then be used to allocate expenses as recommended. Review Assistance I appreciate the assistance Shannon Spurlin provided during the 2008-09 review, Her assistance aided in the performance of the review and preparation of the report, Report Filing This information is intended solely for the use of the Board of Directors and management of Mt. Ashland Association, dba Mt. Ashland and is not intended to be and should not be used by anyone other than the specified parties, I would be pleased to discuss the matters reported, or to answer any questions you may have, at your convenience, I am also available to assist you in the implementation of any of my recommendations. Sincerely, /1 I} ~' ~chard W, Brewster Certified Public Accountant I I I I I I I I I I I I I I I I I I I MT, ASHLAND ASSOCIATION REVIEW REPORT For The Years Ended June 30, 2009 and 2008 . RICHARD W, BREWSTER, CPA, PC CERTIFIED PU8L1C ACCOUNTANT MEDFORD I I I I I I I I I I I I I I I I I I I 'MT, ASHLAND ASSOCIATION For the Years Ended June 30, 2009 and 2008 TABLE OF CONTENTS Paqe Accountants Review Report 1 Financial Statements: Statements of Financial Position 2 Statements of Activities 3 Statements of Cash Flows 4 Notes to Financial Statements 5-11 Supplementary Information Schedules of Functional Expenses 12-13 I I I I I I I I I I I I I I I I I I I ACCOUNTANT'S REVIEW REPORT I I I I I I I I I I I I I I I I I I I RICHARD W. BREWSTER, CPA, PC CERTIFIED PUBLIC ACCOUNTANT 670 SUPERIOR COURT, # 106 MEDFORD, OREGON 97504 (541) 773-1885. FAX (541) 770-1430 WNW. rwbrewstercpa .com ACCOUNTANT'S REVIEW REPORT To the Board of Directors of Mt. Ashland Association Ashland, Oregon 97520 I have reviewed the accompanying statement of financial positions of Mt. Ashland Association, (a not-for-profit corporation), as of June 30, 2009, and 2008, and the related statements of activities and cash flows for the year then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. All information included in these financial statements is the representation of the management of Mt. Ashland Association. A review consists principally of inquiries of Association personnel and analytical procedures applied to financial data, It is substantially less in scope than an audit, in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole, Accordingly, I do not express such an opinion. Based on my review, I am not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with generally accepted accounting principles. My review was made for the purpose of expressing limited assurance that there are no material modifications that should be made to the financial statements in order for them to be in conformity with generally accepted accounting principles. The information included in the accompanying Schedule of Functional Expenses is presented only for supplementary analysis purposes. Such information has not been subjected to inquiry and analytical procedures applied in the review of the basic financial statements, but was compiled from information that is the representation of management, without audit or review. Accordingly, I do. not express an opinion or any other form of assurance on the supplementary information. This report is intended solely for the information and use of the Board of Directors, management, and others within the Association, and is not intended to be, and should not be, used by anyone other than theses specified parties. -~ Richard W. Brewster Certified Public Accountant August 5, 2009 .1. I I I I I I I I I I I I I I 1 I I I I, FINANCIAL STATEMENTS I MT, ASHLAND ASSOCIATION Statements of Financial Position I June 30, 2009 and 2008 2009 200S I ASSETS Current assets Cash and cash equivalents $ 516 $ 144,894 I Investments 11,872 114,065 Acco~nts receivable 3,636 6,214 Prepaid rent and deposits 31,108 2,250 I Inventory 17 ,466 14,685 Total current assets 64,598 282,108 B~ildings and equipment 4,084,287 4,013,446 I Less accumulated depreciation (2,285,953) (2,063,385) I Net buildings and equipment 1,798,334 1,950,061 Contrib~ted facilities lease - net 605,625 681,180 I TOTAL ASSETS $ 2,468,557 $ 2,913,349 LIABILITIES AND NET ASSETS I Current liabilities Accounts payable - trade $ 24,731 $ 26,739 I Accrued expenses 30,841 34,508 Line of credit 29,000 Current portion long-term debt 31,292 28,427 I Deferred revenues 263,498 303,225 Total current liabilities 379,362 392,899 I Long-term liabilities Note payable 114,100 145,393 I T otallong-term liabilities 114,100 145,393 TOTAL LIABILITIES 493,462 538,292 I NET ASSETS Unrestricted 1,362,834 1,687,241 I Temporarily restricted 612,261 687,816 TOTAL NET ASSETS 1,975,095 2,375,057 I TOTAL LIABILITIES AND NET ASSETS $ 2,468,557 $ 2,913,349 I See accompanying notes and accountant's review report. I -2- I I I MT, ASHLAND ASSOCIATION Statements of Activities For the Years Ended June 30, 2009 and 2008 I 2009 2008 REVENUES AND SUPPORT Service fees I Sales $ 1,642,850 $ 2,135,708 Rental income 151,249 188,604 Other income 4,477 8,571 I Total service fees 1,798,576 2,332,883 Other support I Contributions 159,007 352,217 Investment income 1,710 8,876 Legal reimbursement 32,910 Unrealized gain on investments (9,871) I Total other support 193,627 351,222 I Total revenue and support 1,992,203 2,684,105 EXPENSES Program expenses I Tickets ( 140,051 313,140 Ski lifts 349,674 266,793 Ski patrol 79,796 121,134 Vehicles 188,146 208,146 I Grooming 49,086 68,993 Buildings and grounds 157,943 185,656 Slopes 2,197 1,425 I Lodge 29,052 75,043 Cafe 167,143 221,097 Bar 39,697 43,578 Retail 52,438 81,753 I Rental shop 106,538 119,264 Ski school 99,407 168,512 Development 60,734 39,074 Youth and education 50,393 5,937 I General and administrative 599,754 699,020 Marketing 144,561 167,875 I Total expenses 2,316,610 2,786,440 Decrease in unrestricted net assets (324,407) (102,335) I Temporarily restricted net assets Contributions 211,082 216,850 Net assets released from restriction (286,637) (292,405) I Total decrease in temporarily restricted net assets (75,555) (75,555) Total decrease in net assets (399,962) (177,890) I NET ASSETS Beginning of year 2,375,057 2,552,947 I End of year $ 1,975,095 $ 2,375,057 See accompanying notes and accountant's review report -3- I I MT. ASHLAND ASSOCIATION I Statements of Cash Flows For the Years Ended June 30, 2009 and 2008 I 2009 2008 CASH FLOWS FROM OPERATING ACTIVITIES . Change in net assets $ (399,962) $ (177,890) I Adjustments to reconcile change in net assets to net cash from operating activities Depreciation 225,480 233,041 I Amortization of contributed lease facility 75,555 75,555 Unrealized/realized gains on investments (9,871) I nterest and dividends reinvested (706) (8,876) I (Increase) decrease in accounts receivable 2,578 (5,576) (Increase) decrease in prepaid rent and deposits (28,858) 2,772 Increase (decrease) in inventory (2,781) 290 Increase (decrease) in accounts payable - trade (2,008) (22,667) I Increase (decrease) in accrued expenses (3,667) (12,955) Increase (decrease) in line of credit 29,000 Increase (decrease) in deferred revenue (39,727) (91,857) I Total adjustments 254,866 159,856 I NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES (145,096) (18,034) CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of investments 102,899 191,679 I Cash payments for the purchase of buildings and equipment (70,308) (179,622) NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES 32,591 12,057 I CASH FLOWS FROM FINANCING ACTIVITIES Payment of long-term debt (28,428) (25,825) I NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES (28,428) (25,825) I NET INCREASE (DECREASE) IN CASH (140,933) (31,802) CASH AT BEGINNING OF YEAR 144,894 176,696 I CASH AT END OF YEAR $ 3,961 $ 144,894 S~pplemental Disclosures I Interest paid $ 19,338 $ 18,792 I I I See accompanying notes and accountant's review report -4- I I I I I I I I I I I I I I I I I I I I NOTES TO FINANCIAL STATEMENTS 1. I I I Mt. Ashland Association (the Association) is a not-for-profit organization, established under the laws I of the State of Oregon to provide educational and recreational opportunities to the members of the general public in Jackson County, Oregon. The Association offers comprehensive winter recreation I services and educational programs to residents of Southern Oregon and Northern California through the operation of the Mt. Ashland Ski Area. Mt. Ashland prides itself on being affordable to families and youth and is host to an average of over 94,000 skier visits per season. Over 2,000 youths I participate in Mt. Ashland's after-school programs, I I I I I I I I I I I I I MT, ASHLAND ASSOCIATION Notes to Financial Statements (Continued) For the Years Ended June 30, 2009 and 2008 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PURPOSE OF THE ORGANIZATION The Association provides and continues to develop new ways to contribute to our youth and many educational programs and related benefits to the communities of Southern Oregon and Northern California. The Association expects to continue the following programs and expand on the educational awareness programs of after school youth ski and snowbDard, skilsnowboard school, kids club, mountain geology/snow science and environmental/youth summer service. The approximate costs of providing these programs were $307,806 and $242,414 for the years ended June 30, 2009, and 2008, respectively. This summary of significant accounting policies of Mt. Ashland Association is presented to assist in understanding the Association's financial statements. The financial statements and notes are representations of the Association's management who is responsible for their integrity and objectivity, These accounting policies conform to accounting principles generally accepted in the United States, unless otherwise stated, and have been consistently applied in the preparation of the financial statements. BASIS OF ACCOUNTING AND PRESENTATION The accompanying financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America. The Association has adopted Statement of Financial Accounting Standards (SFAS) No. 116, "Accounting for Contributions Received and Contributions Made", and (SFAS) No, 117, "Financial Statements of Not-for-Profit Organizations." SFAS No. 117 establishes standards for external financial reporting by not-for-profit organizations, and requires the Association to report information regarding its financial position and activities into three classes of net assets according to externally (donor) imposed restrictions. SFAS No. 116 requires that unconditional promises to give (pledges) be recorded as receivables and revenues, and requires the organization to distinguish between contributions for each net asset category in accordance with donor imposed restrictions. Descriptions of the three net asset categories, as presented on the Statement of Activities, are as follows: 1) Unrestricted net assets have no donor imposed restrictions. 2) Temporarily restricted net assets have donor-imposed restrictions that will expire in the future. 3) Permanently restricted net assets have donor-imposed restrictions, which do not expire. -5- . . . I I I . I I I I I I I I I I I I MT, ASHLAND ASSOCIATION Notes to Financial Statements (Continued) For the Years Ended June 30, 2009 and 2008 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Unrestricted net assets consist of the general operating fund of the Association and are available for use at the discretion of the Board of Directors. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. INCOME TAXES The Association is a Not-For-Profit Organization that is exempt from federal income taxes under Section 501 (c)(3) of the U.S. Internal Revenue Code. The Association has also been classified as an entity that is not a private foundation within the meaning of Section 509(a), and qualifies for deductible contributions as provided in Section 170 (b)(1)(A)(iii). There was no unrelated business income for the years ended June 30, 2009, and 2008. BUILDINGS AND EQUIPMENT The Association capitalizes all expenditures for buildings and equipment if they are considered to benefit future periods. Purchased buildings and equipment are carried at cost and are considered to be owned by the Association. Donated buildings and equipment are carried at the approximate fair value at the date of donation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. CASH AND CASH EQUIVALENTS For purposes of the statement of cash flows, the Association considers all unrestricted highly liquid investments, with an initial maturity of three months or less, to be cash equivalents. The carrying value of cash and cash equivalents approximates fair value. INVESTMENTS The Association has invested funds with Umpqua Investments, Inc. The funds are managed by Steven Nelson, the assigned financial advisor by Umpqua Investments, Inc. The portfolio assets consist of a bank deposit sweep account. The monies are held in an interest-bearing deposit account at one or more banks, The investment income includes interest income resulting from the investment fund. The cost and the income generated as a result of the investment are reported in the Statement of Activities. ACCOUNTS RECEIVABLE Accounts Receivables are stated at the amount management expect to collect from outstanding balances at year end. Receivables are written off when they are determined to be uncollectible. -6- 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) I I I Inventory consists of food, beverages and ski area related retail merchandise. Inventory is valued at I cost. Cost is determined using a first-in, first-out method of inventory valuation. I I I I I I I I I I I I I I I MT. ASHLAND ASSOCIATION Notes to Financial Statements (Continued) For the Years Ended June 30, 2009 and 2008 INVENTORY ADVERTISING Advertising costs are expensed as incurred. Advertising expense for the years ended June 30, 2009, and 2008 totaled $42,461 and $58,555, respectively. REVENUE The Association's revenue is derived primarily from ski operations including season pass sales, lift ticket sales, lodge sales, bar sales, cafe sales, equipment rentals and ski school income. Sales revenue is recognized when purchases are made, with the exception of season pass sales. Season passes sold during the "Spring Pass" promotion cover the entire following ski season. Management defers this revenue, relating to the following season, into the following fiscal year or until earned. Deferred revenue for the years ended June 30, 2009, and 2008 was $263,498 and $303,225, respectively, 2. BUILDINGS AND EQUIPMENT The following is a summary of equipment, ski rental equipment, furniture and fixtures, and leasehold improvements, which comprise the buildings and equipment account, stated at cost less accumulated depreciation. Renewals and betterments are charged to the asset accounts, while maintenance and repairs, which do not improve or extend the lives of the respective assets, are expensed in the current period. Depreciation of property and equipment is provided on the straight- line basis over the assets estimated useful life as follows: equipment - 5 to 15 years; buildings - 25 years; leasehold improvements - 5 to 30 years. 2009 2008 Equipment $ 1,580,403 $ 1,570,754 Buildings 42,000 42,000 Leasehold improvements 435,636 377,888 Expansion project - construction in progress 2,026,248 2,022,804 Total buildings and equipment 4,084,287 4,013,446 Less accumulated depreciation (2,285,953) (2,063,385) Net buildings and equipment $1,798,334 $ 1,950,061 -7- I I I I I I I I I I I I I I I I I I I MT. ASHLAND ASSOCIATION Notes to Financial Statements (Continued) For the Years Ended June 30, 2009 and 2008 3. OPERATING LEASES The Association leases space for its business office, which expires on September 1, 2009, with options to renew for three one-year extensions, for $1,500 per month. For the year ended June 30, 2009, the lease commitment is $18,000 for the Association's business office. The Association also leases certain ski area assets that were purchased from donated funds to the City of Ashland. This lease term expires on June 30, 2017. Future minimum lease payments as of June 30, 2009, are $1 per year through 2017, for a total lease commitment of $8. A mobile unit is leased by the Association for the amount of $171.25 per month. This lease expires on April 3, 2010. For the year ended June 30, 2009, the lease commitment is $2,055 for the Associations mobile unit The City of Ashland received donations from the gene~al public to purchase certain ski area assets on Mt Ashland which are located on land leased from the U.S. Department of Agriculture/U.S. Forest Service. These ski area assets are leased by the City to the Association for $1 per year. Upon the lease expiration date, June 30, 2017, the Association has the option to extend the lease term for an additional 25 years ending June 30, 2042. This lease requires the Association to maintain the leased ski area assets at an agreed "Minimum Liquidation Value," which was stated at $200,000 in 1992. The "Minimum Liquidation Value" is subject to an escalation provision tied to the Consumer Price Index (CPI). If the Association fails to maintain the leased ski area assets at the "Minimum Liquidation Value" the Association is required to pay the deficiency into a trust fund maintained by the City of Ashland. As of June 30, 2009, no funds have been required to be transferred into this trust fund. In 1994, the Association recorded the lease as a contribution, stated at the ski area assets fair value, for the 25-year term of the lease. This fair value was estimated at $2,833,300 and capitalized. The lease is amortized as Facility Lease Expense over the assets economic life to reflect the relative value of the lease. Amortization expense for the years ended June 30, 2009, and 2008 were $75,555 and $75,555 respectively. The following summarizes the remaining asset value related to the contributed facility lease: Contributed facility lease 2009 $ 2,833,300 2008 $ 2,833,300 Less accumulated amortization (2,227,675) $ 605,625 (2,152,120) $ 681,180 Net contributed lease value The Association also records the approximate yearly value of the lease as temporarily restricted revenue and facility lease expense, The estimated yearly value of facility lease expenses for 2009 and 2008 was $178,920 and $178,920, respectively. The Association assumed the underlying obligation of the City of Ashland's special use permit with the U.S. Department of Agriculture, Forest Service, for the use of the ski area land for the construction, operation and maintenance of a winter sports area. This use permit provides for termination upon breach of any permit condition, or termination at the discretion of the Regional Forester of the Chief of the U.S. Forest Service. The permit expires July 4,2017, with an annual fee based upon a weighted formula applied to various revenue classifications. The adjusted fees for the years ended June 30, 2009, and 2008 were $25,699 and $33,185, respectively. -8- 5. FUNCTIONAL ALLOCATION OF EXPENSES I I I I I I I I I I I I I I Mt. Ashland Association provides educational recreation opportunities to the members of the general I public in Jackson County, Oregon. The Association relies heavily on public support and patronage of outdoor winter recreation, which in turn is dependent upon the overall weather conditions of the I Southern Oregon region. I I I MT. ASHLAND ASSOCIATION Notes to Financial Statements (Continued) For the Years Ended June 30, 2009 and 2008 4. TEMPORARILY RESTRICTED NET ASSETS As described in Note 1, the Association reports financial information regarding its financial position and activities into three classes of net assets according to externally (donor) imposed restrictions. These classes consist of unrestricted net assets, temporarily restricted net assets and permanently restricted net assets. Temporarily restricted net assets have donor-imposed restrictions that will expire in the future. Upon expiration of the donor-imposed restrictions, funds are released from restriction and expensed categorically to align with their functional category. The activity of these funds is represented on the Statement of Activities. Temporarily restricted net assets consisted of the following at June 30, 2009, and 2008: 2009 2008 Contributions Cash contributions Contributed facilities lease $ 32,162 178,920 $ 37,930 178,920 Temporarily restricted contributions 211,082 216,850 Net assets released from restriction Cash released from restriction Contributed facilities lease Contributed facilities lease amortization 32,162 178,920 75,555 37,930 178,920 75,555 Net assets released from restriction 286,637 292,405 Total decrease in temporarily restricted net assets $ (75,555) $ (75,555) The costs of providing various program and supporting services have been summarized on a functional basis in the statement of activities, Accordingly, certain costs have been allocated among the program and supporting services benefited, 6. CONCENTRATION OF RISK Mt. Ashland Association holds all of its cash deposits at PremierWest Bank, The total bank balance at June 30, 2009 was $1,630. All of these deposits were covered by federal depositary insurance. -9- I I I I I I I I I I I I I I I I I I I MT. ASHLAND ASSOCIATION Notes to Financial Statements (Continued) For the Years Ended June 30, 2009 and 2008 7. PENSION PLAN Mt. Ashland Association provides a 401(k) retirement plan for its employees. Employees in Job Classifications 1 and 2 are eligible to participate upon the completion of 30 days of service. Employees may defer a percentage of their compensation, up to the Code 402(g) deferral limit, as described in the company's basic plan document. The Association makes a matching contribution of a minimum of 3% of gross pay per employee, and may make an additional matching contribution at the discretion of the Board of Directors. The contributions for the plan years ended June 30, 2009, and 2008 were $10,616 and $13,553, respectively. 8, LONG-TERM DEBT lender Key Equipment Finance Month(y Payments (November through April) Maturity Date Balance 6/30/09 $ 145,392 145,392 (31,292) $ 114,100 Description Interest Rate Note Payable 9.64% Secured by $ 7,386 Equipment April, 2013 Total Less current portion Net (ong,term debt Future principal requirements for years ending June 30, Note Payable 2010 31,292 2011 34,446 2012 37,917 2013 41,737 I Tota( $ 145,392 9, PURCHASE COMMITMENTS Mt. Ashland Association entered into a purchase commitment of Green Tags with the Bonneville Environmental Foundation (BEF) on August 30, 2007. Each Green Tag represents the environmental attributes associated with the generation of one megawatt-hour of electricity from electrical generating facilities that rely exclusively on wind, solar, geothermal, hydro, and biomass renewable energy sources. Mt. Ashland Association is committed to purchase seven hundred and eighty Green Tags at eight dollars each per year over the lease term. For the year ended June 30, 2009, the Association purchased $6,240 in Green Tags. This commitment was completed as of June 30, 2009. Mt. Ashland Association entered into a new purchase commitment of Green Tags with the Bonneville Environmental Foundation (BEF) on August 10, 2009. This commitment is for the period of September 1,2009, through August 31,2012. The total amount committed by Mt. Ashland Association is $11,040. -10- -11- I I I I I I I I I I I I I I I I I I I MT. ASHLAND ASSOCIATION Notes to Financial Statements (Continued) For the Years Ended June 30, 2009 and 2008 10. CONTINGENCIES Mt. Ashland Association is currently involved in one legal dispute centered on its proposed Area Improvement Project. This is as an intervening party with the U.S. Department of Agriculture (USFS) over the legality of their Record of Decision issued in September of 2004 on the project. The case was heard and ruled on by the U.S. Ninth Circuit Court of Appeals in September of 2007. They identified three points they felt needed additional review and remanded the case on those three entities back to the Oregon District court. The USFS has started the process of issuing a Draft Supplemental Environmental Impact Statement on the three issues. The Final Supplemental Environmental Impact Statement should be forthcoming by late October, 2009. If all of this is approved, which the Association feels strongly it will be, construction on the Improvement Project could begin by early November, 2009. Mt. Ashland Association believes there is a very remote chance of loss in the above dispute. Total expenditures to date that might be affected by these cases are estimated at $1,450,000. These funds have already been expended by Mt. Ashland Association for research, studies, planning and legal costs associated with the Improvement Project. Mt. Ashland Association is not named, or has not been put on notice, of any other legal disputes, claims or actions. 11. SUBSEQUENT EVENTS Mt. Ashland Association Board of Directors voted and passed unanimously on June 22, 2009 to change the Association's 401 K program from a guarantee match to a discretionary match to be determined at the end of the plan year. Mt. Ashland has evaluated subsequent events through September 9, 2009. September 9, 2009, is the date Management last reviewed the financial statements. The report was available to be issued one day after Management's final review on September 10, 2009. I I I I I I I I ... I I I I I I I I I I I SUPPLEMENTARY INFORMATION MT, ASHLAND ASSOCIATION Schedule of Functional Expenses For the Year Ended June 30, 2009 Ski Ski Buildings Tickets Lifts Patrol Vehicles Grooming & Grounds Slopes Lodge REVENUES Sales $ 1,112,414 $ 394 $ 22,623 Rental income 14,223 Contributions Investment income Legal reimbursement Other income Total revenues 1,126.637 394 22,623 EXPENSES Advertising Automobile and charter bus 32,223 Bank. and merchant fees Cost of goods sold 44,420 Depreciation 6,997 $ 111,082 32,421 $ 2,477 $ 1,877 16,039 Donations and contributions Dues & subscriptions $ 220 77 Employee benefits 4,586 14,151 4,201 7,407 $ 3,579 4,744 licenses, permits & fees 700 50 173 1,099 Interest expense Insurance 335 20,496 6,716 7,190 4,457 4,351 1,270 Miscellaneous 49 631 Occupancy 2,055 Salaries & wages 57,697 168,980 57,472 61,015 37,116 34,937 10,446 Payroll tax 5,982 17,781 6,217 6,129 3,934 3,250 1,137 Postage 21 Professional fees Repair & maintenance 35 17,084 41,248 11,780 Supplies 11,145 100 2,616 165 5,567 320 160 Travel & lodging 1,376 200 155 Utilities 6,757 79,425 Waste products Water testing 9,605 Total expenses 140,051 349.674 79.796 188,146 49.086 157,943 2,197 29,052 INCREASE (DECREASE) IN NET ASSETS $ 986,586 $ (349.674) $ (79,796) $ (187,752) $ (49,086) $ (157,943) $ (2,197) $ (6,429) See accountant's review report -12- I I I I I I I I I I I I I I I I I I I 1 ' Rental Ski Youth& Cafe Bar Retail Shop School Development Education Admin Marketing TOTAL S 183,426 $ 95,341 $ 75,032 $ 120,060 $ 11,636 $ B,562 $ 13,362 $ 1,642,850 ' $ 137,026 151,249 $ 80,035 3,417 83,452 1,710 1,710 32,910 32,910 4,477 4,477 183,426 95,341 75,032 137,026 120,060 80,035 11,636 51,076 13,362 1,916,648 - 42,461 42,461 - 32,223 ' 24,271 24,271 74,541 23,179 46,236 188,376 12,576 28 378 30,091 1,129 693 84,069 1,178 301,035 600 600 ' - - 355 - 6,897 295 7,844 (15) 4,131 1,924 3,969 4,121 5,255 58,053 703 428 438 449 2,342 6,382 19,338 19,338 1,442 273 92 1,465 9,397 213 4,012 131,310 1,238 194,257 - 3,406 4,086 329 100 50,205 52,689 59,957 11,016 3,494 60,082 77,480 44,675 32,362 169,588 82,757 969,074 6,501 1,200 380 6,486 8,392 4,548 3,458 14,191 7,979 97,565 1.807 696 2,223 4,747 ' 347 60,716 61,063 3,430 2,042 971 290 76,880 5,639 983 1,425 1,709 730 4,272 632 6,606 255 42,344 35 - 324 - - 519 5,808 3,436 369 12,224 20,183 2,464 108,849 ' 2,319 201 124 2,644 9,605 167,143 39,697 52,438 106,538 99,407 60,734 50,393 599,754 144,561 2,316,610 ' $ 16,283 $ 55,644 $ 22,594 $ 30,488 $ 20,653 $ 19,301 _1__(38,7571 $ (548,678) _1__(131 199) $ (399,962) MT. ASHLAND ASSOCIATION Schedule of Functional Expenses For the Year Ended June 30, 2008 Ski Ski Buildings Tickets Lifts Patrol Vehicles Grooming & Grounds Slopes Lodge REVENUES Sales $ 1,433,599 $ 88 $ 43,780 Rental income 16,500 Contributions Investment income Other income $ 1,334 Total revenues 1,450,099 BB 1,334 43,780 EXPENSES Advertising B5 Automobile and charter bus 69,578 29,441 Bank and merchant fees Cost of goods sold 59,955 Depreciation 156,424 17,443 Donations and contributions Dues & subscriptions $ 212 75 Employee benefits 4,797 $ 13,797 4,567 8,231 $ 3,787 4,907 Licenses, permits & fees 3,100 42 237 532 258 Interest expense 9,238 Insurance 1,133 27,552 11,725 8,600 7,212 5,154 1,537 Miscellaneous 355 79 Occupancy 2,055 Salaries & wages 66,448 181,260 85,658 61,969 52,486 37,997 23,436 Payroll tax 6,543 20,091 8,977 6,232 5,508 3,483 2,695 Postage 529 Professional fees Repair & maintenance 337 23,697 1,465 43,648 23,270 $ 1,425 64 Supplies 7,919 96 6,078 8,022 169 Travel & lodging 1,625 300 334 Utilities 4,774 92,726 Waste products Water testing 8,961 Total expenses 313,140 266,793 121,134 208,146 68,993 185,656 1,425 75,043 INCREASE (DECREASE) IN NET ASSETS $ 1,136,959 $ (266,793) $ (121,134) $ (208,058) $ (68,993) . (184,322) $ (1,425) $ (31,263) See accountant's review report. -13- I I I I I I I I I I I I I I I I I I I I I I Rental Ski Youth & Cafe B.. Retail Shop School Development Education Admin Marketing TOTAL $ 220,637 $ 118,627 $ 109,003 $ 22,806 $ 161,578 $ 19,040 $ 6,550 $ 2,135,708 172,104 188,604 I $ 271,366 5,296 276,662 (995) (995) 7,237 6,571 220,637 118,627 109,003 194,910 161,578 271.366 30,578 6,550 2,608,550 I 130 16,491 337 41,512 58,555 337 60 37 99,453 35,577 35,577 I 113,177 27,536 59,983 550 261,201 16,750 376 29,238 3,768 90 83,383 1,122 308,596 100 100 97 725 4,818 5,927 1,666 394 4,455 3,139 20,528 10,748 81,016 I 660 426 300 260 100 1,120 7,037 9,554 18,792 313 436 2,050 17,071 44 $ 676 152,122 532 236,161 1,517 1,951 43,482 45,537 I 72,838 11,777 16,846 72,865 120,220 6,069 4,758 229,401 96,569 1,140,597 7,639 1,240 1,694 7,790 12,889 697 501 40,689 9,623 136,291 1,543 121 210 2,748 5,151 410 11,700 20,399 32,509 I 2,262 1,437 45 1,544 436 99,632 3,678 437 477 1,668 941 2,545 21,935 729 54,694 444 9,454 505 8,923 3,779 25,364 563 20,843 2,786 121,692 1,646 1,646 I 8,961 221,097 43,578 81,753 119,264 168,512 39,074 5,937 699,020 167,875 2,786,440 $ (460) $ 75,049 $ 27,250 $ 75,646 $ (6,934) $ 232,292 $ (5,937) $ (668,442) $ (161,325) $ (177,890) I I I I I I I I I