Pendennis Club Incorporated

PART X, LINE 2:

“Pendennis club, incorporated is a nonprofit organization and is exempt from income taxes under section 501(c)(7) of the internal revenue code. The exemption is on all income except unrelated business income as noted under section 511 of the internal revenue code. Internal revenue code section 513(a) defines an unrelated trade or business of an exempt organization as any trade or business which is not substantially related to the exercise or performance of its exempt purpose. Pc products, llc is a c corporation and any deferred income taxes would arise from temporary differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements. At october 31, 2024 and 2023, no deferred income taxes have been recorded as any amount would not be material to the financial statements. Accounting principles generally accepted in the united states of america require management to evaluate tax positions taken by the club and recognize a tax liability if the club has taken an uncertain position that more likely than not would not be sustained upon examination by various federal and state taxing authorities. Management has analyzed the tax positions taken by the club, and has concluded that as of october 31, 2024 and 2023, there are no uncertain positions taken or expected to be taken that would require recognition of a liability or disclosure in the accompanying consolidated financial statements. The club has filed its federal and state income tax returns for periods through october 31, 2023 and is subject to routine audits by taxing jurisdictions. However, as of the date the consolidated financial statements were available to be issued, there were no audits for any tax periods in progress. These income tax returns are generally open to examination by the relevant taxing authorities for a period of three years from the later of the date the return was filed or its due date (including approved extensions).”