Brandywine Valley Associationinc

“Conservation easement revenues and expenses are reported as seperate line items on the statement of activities and statement of functional expenses, respectively. Conservation easement revenues and expense follow the reporting framework of generally accepted accounting principles of the united states; revenues are recognized in the period when earned and expenses are recorded when a liability is incurred. On march 8, 2012 the association entered into a conservation easement with the brandywine conservancy (grantee) and pocopson township (co-grantee) and eased 268 acres of land located at the myrick conservation center. In return for this conservation easement the association received 880,000 from pocopson township. On april 11, 2012 delmont and sheila bittle (grantor) entered into a conservation easement with the brandywine valley association (grantee) and pocopson township (co-grantee) and eased 32.9322 acres of lands owned by the bittles in pocopson township. The association received 8,000 from the bittles and an additional 9,000 from pocopson township as an unrestricted endowment to cover costs associated with holding and monitoring this easement. On december 17, 2012, e. Bernard and jane b. Baily (grantor) entered into a conservation easement with the brandywine valley association (grantee) and pocopson township (co-grantee) and eased acres of lands owned by the bailys in pocopson township. The association received 12,500 from the bailys as an unrestricted endowment to this easement. The association recognized 909,500 of revenue in 2012.”

“Brandywine valley association is exempt from federal and state income taxes under the provisions of section 501(c)(3) of the internal revenue code; therefore, no provision for income taxes has been made in the financial statements. In addition, the entity has been classified as one that is not a private foundation within the meaning of section 509 (a) of the internal revenue code and qualifies for deductible contributions as provided in section 170(b)(1)(a)(vi). Although the entity is not subject to federal and state income taxes, the entity is required to apply the provisions of asc 740 "accounting for income taxes", which applies to all entities including those that are tax exempt under 501(c)(3). Asc 740 clarifies the accounting and reporting for income taxes where interpretation of the tax law may be uncertain. Asc 740 prescribes a comprehensive model for the financial statements recognition, measurement, presentation and disclosure of income tax uncertainties with respect to positions taken or expected to be taken in income tax returns. Management has reviewed its current and past federal income tax positions and has determined, based on clear and unambiguous tax law and regulations, that the tax positions taken are certain and that there is no likelihood that a material tax assessment would be made if the respective government agency examined tax returns subject to audit. Accordingly, no provision for the effects of uncertain tax positions has been recorded. Currently, the december 31, 2010, 2011 and 2012 tax years are open and subject to examination by the internal revenue service; however, the entity is not currently under audit nor has the entity been contacted by this jurisdiction. Any interest and penalties related to income taxes would be in income tax expenses. There are no interest and penalties as of december 31, 2013 and 2012.”