Medicines360

PART X, LINE 2:

“Medicines360 is exempt from federal and state income taxes under the provisions of section 501(c)(3) and section 170(b)(1)(a)(vi) of the internal revenue code and corresponding provisions of the california revenue and taxation code. Accordingly, no provision for income taxes has been made in the accompanying consolidated financial statements related to its activites. In september 2012, the organization applied for a medical research organization ("mro") status with the internal revenue service ("irs") which will allow it to achieve its mission by focusing on medical research and remaining a 501(c)(3) public charity without public support. This status was granted to the medicines360 in april 2014. However, income from certain activities not directly related to medicines360's tax exempt purpose is subject to taxation as unrelated business income. Medicines360's wholly owned subsidiary, alliance partners360, inc. (formerly m360, inc.) is a c-corporation, incorporated in the state of delaware. Alliance partners360 files a separate federal and state income tax return. Alliance partners360 records income taxes under the asset and liability method of accounting for income taxes. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and for operating loss and tax credit carryforwards. Medicines360's wholly owned subsidiary, impact rh360, is a limited liability corporation incorporated in the state of delaware. No provision has been made for federal and state income taxes since such items are the responsibility of the member. The organization follows the guidance for uncertain tax positions and began reviewing and assessing tax positions taken and expected to be taken against the more-likely-than-not recognition threshold and measurement attributes for financial statement recognition. Management has concluded there are no uncertain tax positions as of december 31, 2015 and 2014.”