Fhcsd Growth Fund Inc.

PART X, LINE 2:

“Fhcsd growth fund inc. Has been recognized as a not-for-profit organization under internal revenue code section 501(c)(3) and california revenue code section 23701(d) and is exempt from federal and california income taxes on related income for the year ended june 30, 2020. Effective september 4, 2014, through it's supported organization, family health centers of san diego, inc., growth fund, inc.(a 509(a)(3) supporting organization) adopted newly issued guidance on accounting for uncertainty in income taxes. Under this new guidance, the organization utilized a two-step approach to recognizing and measuring uncertain tax provisions (tax contingencies). The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. As a result of the adoption of accounting for uncertainty in income taxes, fhcsd growth fund, inc. Did not recognize an increase or decrease in the liability for unrecognized tax benefits related to tax positions taken in prior periods; therefore, there was not corresponding adjustment to unrestricted net assets. Additionally, for the year ended june 30, 2020, there were no additional liabilities recorded for unrecognized tax benefits related to tax positions taken in the current year. The organization considers many factors when evaluating and estimating it's tax positions and tax benefits, which may require periodic adjustments and which may not accurately forecast actual outcomes. There were no accruals for interest and penalties related to uncertain tax positions at the inception date or for the year ended june 30, 2020. Fhcsd growth fund, inc. Has determined that it's major tax jurisdiction is the state of california. The tax year 2019-20 will remain open and subject to examination by the california franchise tax board until 2022.”