Alliance Resources Incorporated

“The sole member of Alliance Resources is CMC Healthcare System”

“The directors are appointed by the sole member.”

“The sole member has reserved powers over Alliance Resources but does not approve each separate action taken by the Alliance Resources board.”

“Form 990 is prepared by an independent tax accounting firm (Baker, Newman, Noyes). Upon completion, a draft of the Form 990 is sent to the Organization, where the CFO, Controller, and Director of Accounting perform a final in-house review prior to submission to the Board of Directors for final approval. Upon approval from Board, Form 990 is filed with the Internal Revenue Service.”

“Officers and directors are required to complete a conflict of interest policy annually.”

“A related organization, Catholic Medical Center utilizes a compensation committee of the board of directors to set compensation levels and determine bonus potential for its senior leadership team. The committee is assisted by an independent consultant who surveys like-sized and performing institutions to benchmark relevant salary scales for each position. The consultant's findings are presented to the compensation committee who considers that external data with actual performance against a list of pre-established goals per senior leaders to set prospective compensation levels and bonus values. Bonus amounts are determined by how well an executive achieves a pre-defined set of goals. These goals, in general, are tied to the achievement of a specific task or project. Some goals are attached to achieve overall financial performance and mission performance, not solely revenue generation.”

“The Organization makes its governing documents, conflict of interest policy, and financial statements available to the public upon request.”

“Alyson Pitman Giles and Raymond Bonito provided no services as employees or officers to the Hospital during the fiscal year. Additionally, neither earned any amount of compensation in the current year for past services rendered. However, in accordance with IRS instructions, each has been listed as a "Former" officer on Form 990, Part VII, Section A as each received over $100,000 in W-2 compensation. The W-2 compensation they received consisted predominantly of payments of amounts previously earned as deferred compensation that accrued to them during their tenure with the Hospital and as previously reported on Schedule J, Part II, Column C of prior Form 990s. This deferred compensation represented remuneration for many years of distinguished service to the Hospital but does not reflect compensation for services rendered to the Hospital during the current fiscal year.”

“Net Transfer from Affiliate 200,004.”

“The audit process has not changed from the prior year.”