Alliance for Continuing Medical Education Inc.

“The alliance's endowment funds consists of three funds established for a variety of purposes. As required by generally accepted accounting principles, net assets associated with endowment funds, including funds designated by the board of trustees to function as endowments, are classified and reported based on the existence or absence of donor-imposed restrictions. Interpretation of relevant law the board of trustees of the alliance has interpreted the state of connecticut prudent management of institutional funds act (spmifa) as requiring the preservation of the fair value of the original gift as of the gift date of the donor-restricted endowment funds absent explicit donor stipulations to the contrary. As a result of this interpretation, the alliance classifies as permanently restricted net assets (a) the original value of gifts donated to the permanent endowment, (b) the original value of subsequent gifts to the permanent endowment, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. The remaining portion of the donor-restricted endowment fund that is not classified in permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the alliance in a manner consistent with the standard of prudence prescribed by spmifa. Return objectives and risk parameters the alliance has adopted investment and spending policies for endowment assets that attempt to provide a predictable stream of funding to programs supported by its endowment funds while also maintaining the purchasing power of those endowment assets. The endowment funds have been invested in balanced portfolio of fixed income and equity mutual funds. Investment and spending policy the primary investment objectives of the endowment funds are to produce a rate of total return which will permit support for annual award, and presentation of honorarium and plaque for a guest lecturer at the alliance's the annual conference to the extent that is consistent with the following: prudent management of investments, preservation of principal, and potential for long-term asset growth. Under existing market conditions, the alliance will seek investment grades that are reasonable, but with the overarching factor that principal presentation is a greater priority than targeted returns. The alliance will adjust accordingly as the economy changes. The income earned from these investments is primarily to fund support the alliance's annual conference as designated by the donors when the original gift was made. Performance will be monitored on periodical basis. For all funds held by the alliance - the goal is preservation. The funds available to the alliance are not substantial enough to take any extraordinary risks and thus preservation of principal over generating returns will be followed until such time that the reserve funds grow where this philosophy must be altered.”

“The alliance requires that a tax position be recognized or derecognized based on a "more-likely-than-not" threshold. This applies to positions taken or expected to be taken in a tax return. The alliance does not believe its consolidated financial statements include, or reflect, any uncertain tax positions.”