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WEBINAR III: Submitting Operator Financial Statements Wednesday, March 18, 2015 Presented by: Office of Residential Care Facilities 232 Healthcare Portal Training This presentation is provided for informational purposes and its contents are subject to change. It is not intended to substitute or alter requirements and guidelines found in FHA handbooks, mortgagee letters, and other official FHA publications. Distribution, reprinting and/or web-publishing of this presentation is prohibited.

LEARNING OBJECTIVES At the completion of this course you will better understand: 232 Healthcare Portal’s Purpose & Use ORCF Requirements for Operator’s Financial Statement How to obtain access to the 232 Healthcare Portal How to initially sign onto the 232 Healthcare Portal How to attach and submit financial information into the 232 Healthcare Portal How to review results 7

8 Introduction

The Servicer will decide how they will receive the financial statements. Many lenders currently receive operator financial statements so there may be no change for those operators. The portal is just one of many options at the Servicer’s disposal. 9 Basic Facts on the 232 Healthcare Portal

Requirement OIG Audit Accountability Rule Change: 9/7/12 – 24 CFR Part Federal Register Notice on 10/3/2014 See 2/25/2015 Blast for details. ‹#›

Timing and Commencement Quarterly Financials: Must be submitted to HUD within 60 Days of the End of the Quarter FYE Financials: Must be submitted to HUD within 90 Days of the End of the FY Required for FY’s commencing on or after 12/2/2014. – Great majority of projects (CY) – 1 st Q 2015 – Due End of May, 2015 ‹#›

Key Terms  Lender Account Manager (LAM) – This is the Servicing Lender’s System Administrator. The Lender Account Manager is responsible for authorizing Servicer Staff and Operators access to the 232 Healthcare Portal for an assigned Servicer, reset passwords for that Servicer Staff and authorize which Servicer Staff can upload and submit information into the 232 Healthcare Portal.  Backup Account Manager (BAM) – This is the backup to the LAM  Lender Account Representative (LAR) – This is the person that the LAM assigns to upload and submit information into the 232 Healthcare Portal. 12

Key Terms  Operator – Operators of the Section 232 Projects are defined as the borrower on projects without an operating lease and as the lessee on projects with an operating lease.  Operator Account Representative (OAR) – The OAR is the individual assigned by the LAM from the Operator that provides information to the Servicer.  Project Report - This report shows the financial information that was entered into the portal for a specific project. It also provides the five ratio calculations for the project.  Servicer – The Lender that collects interest, principal, escrow payments and FHA’s mortgage insurance premium (MIP). 13

14 To provide Servicers a tool to submit Operator’s quarterly and annual financial statements to HUD. To assist the Office of Residential Care Facilities with a business solution to monitor operators of section 232 insured projects. The purpose and use of the 232 Healthcare Portal is:

Operator Financials

Certified  Financial statements prepared by the chief financial officer of the facility.  The financial statements will include a balance sheet and income statement.  Certified financial statements can be produced to report monthly, quarterly or annual results.

Example of Financial Statement – Balance Sheet BALANCE SHEET My Old Nursing Home Six-months period, ending June 30, 2014 ASSETSLIABILITIES Cash$318,856Accounts Payable & Accrued Expenses$51,349 Net Patient Accounts Receivable$25,698Payroll & Benefits$1,759 Prepaid Expenses$324,004Due to Affiliates$176,822 Other Current Assets$278,654Other Current Liabilities$397,128 TOTAL CURRENT ASSETS:$947,212TOTAL CURRENT LIABLITIES:$627,058 Building and Improvements$236,521Car loan$23,412 Furniture, fixtures & Equipment$59,231TOTAL LIABILITIES:$650,470 Less Accumulated Depreciation-$102,009 NET PPE:$193,743FUND BALANCE/STOCKHOLDER EQUITY:$490,485 TOTAL ASSETS:$1,140,955 TOTAL LIAB & FUND BALANCE:$1,140,955

Example of Financial Statement – Income Statement INCOME STATEMENT My Old Nursing Home Six-month period, ending June 30, 2014 REVENUES Patient Care Revenues$4,357,962 Rehab Services$708,952 Interest Income$1,099 Dining services$62,983 TOTAL REVENUES:$5,130,996 EXPENSES Salaries/Wages$1,784,111 Health Services$13,334 Utilities$235,781 General/Administrative$1,038,063 Lease$1,582,528 Depreciation& Amortization$196,000 TOTAL EXPENSES:$4,849,817 NET INCOME:$281,179

How to Access the 232 Healthcare Portal

The 232 Healthcare Portal can be accessed by: – Public view from HUD's website: ration/healthcare_facilities/residential_care/Operator_Financial_Stmt ration/healthcare_facilities/residential_care/Operator_Financial_Stmt 20

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How to Navigate

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Completing the Servicer/Operator Data Input Form

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Reviewing Attachments

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LEARNING OBJECTIVES REVIEW At the completion of this course you will better understand: 232 Healthcare Portal’s Purpose & Use ORCF Requirements for Operator’s Financial Statement How to obtain access to the 232 Healthcare Portal How to initially sign onto the 232 Healthcare Portal How to attach and submit financial information into the 232 Healthcare Portal How to review results 65

66 Source Materials ORCF Webpage to Operator Financial Statement Portal and Materials dential_care/Operator_Financial_Stmt Final Rule directing operators to submit their financial statements to HUD Final Rule Extending Time Period to Submit Financial Statements to HUD Federal Register Notice announcing start date for operators to financial statements Blast on the Operator Financial Statements ORCF Contact: 232 Healthcare Portal – Help Desk (located on the Contact Us tab)