Muskingum University

“Schedule D, Part II, Line 9 There is a National Historic District that extends onto campus and Muskingum has one building (Paul Hall) listed on the National Register of Historic Places. Maintenance and repairs for these buildings are reported in capital and maintenance expense.”

“Schedule D, Part III, Line 4 Collections of art consists of student and other art works maintained for use and viewing by future generations. No SFAS 116 disclosure of art is included in the University's financial statements as the value of the collection is not deemed to be material to the University's financial position.”

“Schedule D, Part V, Line 4 The University uses a total return investment management policy to determine endowment spending. In fiscal 2007, the University adopted a policy which utilizes an amount of 4.5% of the prior five-year quarterly average market value of the endowment fund. The actual spending rate for fiscal 2017 was 3.9%. This total return concept allows a portion of accumulated unrealized and realized capital gains to be used for current operations.”

“Schedule D, Part X, Line 2 The University has been determined to be exempt from federal income taxes under Section 501(a) of the Internal Revenue Code of 1986 (the Code), as an organization described in Sections 501(c)(3) and 170(B)(I)(A)(ii) of the code. Accounting principles generally accepted in the United States of America prescribes recognition thresholds and measurement attributes for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Tax benefits will be recognized only if a tax position is more-likely-than-not sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized will be the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the more-likely-than-not test, no tax benefit will be recorded. Management has concluded that they are unaware of any tax benefits or liabilities to be recognized at June 30, 2017. The University would recognize interest and penalties related to unrecognized tax benefits in interest and income tax expense, respectively. The University has no amounts accrued for interest or penalties for the year ended June 30, 2017. The University is no longer subject to examination by taxing authorities for years before 2013. The University does not expect the total amount of unrecognized tax benefits to significantly change in the next 12 months.”

“Line 2d - Revenue on books but not on return: Student discounts (18,539,060) Change in Annuity Obiligation (80,191) Actuarial changes 495.162 Total Line 2d.................... (18,124,089) Line 4b - Revenue on return but not on books: Rental expense (6,564) Fundraising expense (11,389) Inventory cost of good solds (121,603) Total Line 4b........................ (139,556)”

“Line 2d - Expenses on books but not on return: Rental expense 6,564 Fundraising expense 11,389 Inventory cost of good solds 121,603 Total Line 2d....................... 139,556 Line 4b - Expenses on return but not on books: Student discounts 18,539,060”