Holmes-Wayne Electric Cooperative Inc

“The cooperative is owned and operated by its members.”

“Members of the cooperative elect a nine member board of trustees to oversee the management of the cooperative.”

“An independent accounting firm prepares the tax return annually. Once the return has been assembled and completed by the accounting firm, a draft copy is sent or delivered to the filing organization. The return is then sent to each board member before the monthly meeting. This is designed to allow for individual review time before the entire board assembles for their monthly meeting to review the tax return as a group. The board will address any questions, and propose necessary revisions if needed prior to filing the return with the appropriate taxing authorities.”

“The cooperative monitors its conflict of interest policy by requiring its employees and board of trustees to complete a conflict of interest certification and disclosure form annually. By doing so, the board is made aware of any potential conflicts of interest as they arise and enforces compliance with this policy.”

“The ceo/president's compensation is decided by the board of trustees by evaluating the ceo/president's performance and by using a compensation survey on comparable cooperatives in the state, region, & nation. The compensation statistics can be compared based on the size, revenues, number of meters, & etc. Of a cooperative. Compensation for the cooperative's asst. Manager/engineer and accounting manager is based on annual performance reviews and industry data trends, with a final decision made by the ceo/president. Each of the three officers' compensation is reviewed annually.”

“The cooperative maintains pertinent public records and releases them to the public by request. The organization's most recently filed tax returns are also available for viewing on-line at <www.guidestar.org>.”

“The mission of holmes-wayne electric coopertative, inc. Is to safely provide reliable, competitively-priced electric service for our member-owners to enhance the quality of life in the communities we serve while embracing cooperative principles and values.”

“Treatment of capital credits: irs has specific instructions for reporting capital credits for utility companies. Accordingly, the filing organization is noting that it is reporting its patronage allocated capital credits as expenses on form 990, part ix, line 4 beginning with tax year 2011. The organization is also noting that the retired patronage capital credits are still being shown as an other asset adjustments and are noted in detail on schedule d, page 5, and also on schedule o.”

“Unclaimed retired capital credits -1,676,767. Change in donated capital 89,955. Change in retired capital credits - 80,444. Patronage dividends allocated - cy 4,157,176. Other equity - fasb 158 adj 4,500.”

“It is the responsibility of the 9 directors on the board to oversee any audits, reviews, or compilations of financial statments and to select an independent accountant. This policy has not changed since the prior year.”