Pinecrest Village

Part X, Line 2:

“The Home, the Village, and the Grove all file a Form 990, Return of Organization Exempt from Income Tax, annually. When these returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would ultimately be sustained. Unrelated business income (UBI) is reported on Form 990-T, as appropriate. The benefit of a tax position is recognized in the consolidated financial statements in the period during which, based on all available evidence, management believes that it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions are not offset or aggregated with other positions. Tax positions that meet the "more likely than not" recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely to be realized on settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying consolidated statements of financial position along with any associated interest and penalties that would be payable to the taxing authorities upon examination. As of June 30, 2015 and 2014, there were no unrecognized tax benefits identified and recorded as liabilities. Forms 990 filed by the Home, the Village, and the Grove are subject to examination by the IRS up to three years from the extended due date of each return. Forms 990 filed by the Home, the Village and the Grove are no longer subject to examination for the years ended June 30, 2011 and prior.”