Auxilium Inc.

PART X, LINE 2:

“Help is generally exempt from federal and state income taxes under the provisions of section 501(c)(3) of the internal revenue code. In addition, help has been determined by the internal revenue service (irs) not to be a private foundation. However, help is subject to income taxes on unrelated business income, as defined by the irs. At september 30, 2016 and 2015, help had no net taxable unrelated business income, and accordingly, no provision for income taxes is required in the accompanying financial statements. Help adopted the accounting standards on accounting for uncertainty in income taxes (fasb asc topic 740-10), which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under this guidance, help may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater-than-50-percent likelihood of being realized upon ultimate settlement. The guidance on accounting for uncertainty in income taxes also addresses de-recognition, classification, interest and penalties on income taxes, and accounting in interim periods. Management has evaluated help's tax positions and concluded that help had taken no uncertain tax positions that require adjustment to the financial statements to comply with provisions of the applicable accounting guidance. Generally, help is no longer subject to u.s. Federal or state and local income tax examinations by tax authorities for years before 2012.”