Farmers Electric Cooperative Inc

“All members are of the same class.”

“All members have one vote.”

“Revisions to the articles of incorporation require a vote from the members.”

“The cooperative does not have committees with the broad authority to act on behalf of the board of directors.”

“The form 990 will be presented at the regularly scheduled board meeting by the ceo.”

“All directors, officers, and members of management are covered by the conflict of interest policy. Potential conflicts are discussed and determined at the board level. Persons with conflicts abstain from discussion and voting on the issue at hand.”

“The board of directors determined the compensation for the ceo through the use of compensation studies from nreca. This process was completed during november 2022. The board performed an evaluation of the ceo in its may 2023 board meeting. The discussion and decision by the board were documented. No evaluations or comparisons were done in 2024 but will be done going forward.”

“The articles of incorporation and by-laws are given to new members. The financial statements are provided in the annual report or upon request. The conflict of interest policy is available upon request.”

“Included in other compensation is the estimated current year increase or decrease in the actuarial value of the defined benefit plan for the ceo. The current year increase or decrease does not represent current year contributions to the plan. Rather, it is an estimate of the increase or decrease in the actuarial value of the plan as calculated by the plan administrator.”

“In 2023, a vendor's email was compromised by a third party, including a fraudulent bank account for payment of some large equipment invoices. Ach payments totalling approximately $260,000 were subsequently sent to the wrong bank account. The local bank of farmers electric cooperative was able to recover some of the remaining funds in the account, but the total loss of $239,269 was booked as an extraordinary expense on the 2023 form 990, part ix. For 2024, the $50,000 reported on part viii, line 11a is the insurance payment received related to this incident, reported as extraordinary income. In response to the incident, procedures were put into place in which the bank calls the controller prior to any ach going out in order to verify the transfer is properly authorized.”

“Retirement of capital credits -747,608. Allocation of 2024 margins to members in 2025 1,841,065.”

“The labor, pension and payroll taxes reported on lines 5-10 are included in distribution expense, administrative & general expense and customer expense. Therefore, labor, pension and payroll taxes are shown as a reduction to other expenses on line 24e.”

“The cooperative has interpreted the instructions to part ix, line 4, to mean patronage capital allocated for the year, rather than patronage capital retired. This is consistent with the by-laws of the cooperative.”