Loma Linda University

“Executive leadership is employed by loma linda university adventist health sciences center (lluahsc), a related 501(c)(3) organization. Lluahsc is the sole member of loma linda university.”

“Lluahsc is the sole member of llu.”

“Lluahsc as the sole member maintains certain reserved powers, including the power to appoint or remove trustees.”

“The powers reserved by lluahsc as member, which may only be exercised by the lluahsc board upon the affirmative vote of two-thirds of the trustees present and voting at any regular or special meeting of the board at which a quorum is present are to: 1. Approve or ratify all changes to the articles of incorporation and bylaws of llu, as corporate member. 2. Appoint the board for llu as the member. 3. Approve any significant change in the corporate purposes of llu. The powers reserved by lluahsc as member, which shall only be exercised by the lluahsc board upon majority vote of lluahscs trustees present and voting at a regular or special meeting whenever a quorum is present, are to: 1. Remove from office any trustee of llu with or without cause. 2. Appoint the executive vice president for university affairs who shall ordinarily serve as the chancellor. 3. Approve any merger, consolidation, dissolution, sale, or transfer of more than ten million dollars of the assets of llu. 4. Require llu to have a policy for borrowing funds that is congruent with the lluahsc board-approved policy on borrowing. 5. Approve all borrowing of five million dollars or more by llu or its subsidiaries (see board-approved policy for borrowing of funds). 6. Approve any exceptions to the policy for the borrowing of funds by llu. 7. Approve the strategic plan of llu. 8. Approve major construction projects of llu. 9. Approve institutes and corporations subsidiary of llu. 10. Accept the annual audited financial statements of llu. 11. Approve the annual operating and capital budgets of llu. 12. Approve the llu contracting guidelines. 13. Approve recommendations from llu and its subsidiaries for business development plans and activities. 14. Require llu to have a compliance program.”

“The form 990 is reviewed by internal audit and management. The return is made available to the audit committee and board of trustees for review and comments after filing.”

“General counsel annually obtains statement of disclosure from trustees, officers, administrators, key employees, and others who make or affect significant decisions and reviews the findings with appropriate boards and committees. The board of trustees makes the decisions regarding questions which have not been satisfactorily answered after administrative consideration. The general conference auditing department annually audits compliance with this policy.”

“Lluahsc, llus parent organization, employs an independent outside consulting firm to benchmark compensation for lluahsc employees, including the ceo and top management. Lluahsc provides management services for llu. The lluahsc executive compensation committee uses the results of the independent survey to establish pay scales for the next fiscal year. The executive compensation committee sets the total compensation below the industry mean and median amounts provided in the survey. The executive compensation committee is composed of trustees appointed by the lluahsc board who are independent of lluahsc's management. The executive compensation committee is appointed by the lluahsc board of trustees to have direct responsibility for establishing compensation, policies, and benefits for the senior executives of lluahsc. The committee's process includes contemporaneous substantiation of deliberations and decisions. For key employees other than the officers as well as employees in leadership positions, llu management, through the human resource department, obtains the services of an independent consulting firm to conduct nationwide compensation surveys. Management uses the comparable benchmarks in the survey results to establish or review pay scales for the position. This survey, conducted by the independent consulting firm, is performed for the organization every two years. Internally, the human resource department conducts annual surveys using at least three survey results from independent firms to establish or review the reasonableness of compensation amounts. This process was last undertaken in 12/12 for the position of evp, medical affairs & dean, school of medicine held by hadley, henry roger; president & ceo held by hart, richard henry; evp, finance & administration & cfo held by lang, kevin and vp, academic affairs held by carter ronald.”

“Llu will make its governing documents and conflict of interest policy available to the public upon request. The conflict of interest policy is posted on the organization's internal website for employees. Financial statements are not made available to the public. Form 990, part vii, line 1a: for employees of lluahsc or lluahsc affiliates (organization(s)) related to the filing organization who devote less than full-time to the filing organization (based upon the average number of hours per week shown in part vii, section a, column (b) of the return) the compensation amounts shown in columns (e) and (f) were provided in conjunction with their responsibilities and roles in other positions for organizations related to the filing organization. These individuals each devote approximately 50 hours per week serving in their respective positions within the organization.”