Annual Meeting Finance Review March 21, 2015 2014 Year End Report 2015 Budget

Steve Matthews (treasurer/chair) Finance Committee Steve Matthews (treasurer/chair) Rolf Basler Dick Cameron Chuck Ohrt George Retter Dave Shirlen Many thanks to all committees for budget and reserve input.

Finance Components Catawba Valley Property Management (CVPM): Issues purchases, receives and codes invoices, manages late payment communications, ……….. Accounting - Boggs, Crump & Brown, P.A.: Monthly Compilation Reports Monthly checks for signature Enter billing information to BB&T Association Services and maintain payment data

Banking: BB&T – Checking, Operating (MM) & Escrow (MM) Accounts and CDARS First Citizens - MM Account BB&T Association Services: Issues invoices and receives all payments Multiple payment options - by mail, credit card on-line, at any BB&T Bank, ……. Deposit all funds to appropriate BB&T account CDARS ®

Return on SPOA Funds Interest on Bank money market funds is 0.04% to 0.05% Moving funds to a laddered system CDARS with 1, 2 and 3 year maturity @ 0.25 to 1.05% depending on market.

CDARS® (Certificate of Deposit Account Registry Service®) Security of FDIC insurance on all CD deposits as funds may be distributed among financial institutions Earns CD-level rates Convenience of working just one financial institution Early redemption loses some interest Plan: Purchase 1, 2, & 3 year maturity Note: FDIC insurance limit - $250,000, SPOA total cash balance Feb. 28, 2015 = $756,346.93

2014 Year End Report 2015 Budget

2014 Year End - Statement of Assets and Liabilities Total Assets $548,827.32 Liabilities (construction) $ 72,200.00 Total Capital $476,627.32

Special Funds – Unrestricted and Restricted Reserve Funds: Lot owner Parking Lot $ 26,893.00 Road $ 213,330.53 Clubhouse $ 41,509.00 Pool $ 39,519.00 Security & Technology $ 3,851.00 Landscape $ 2,000.00 Contingency $ 42,352.30 (Includes year end surplus of $2392.66) Total Lot Owner Reserve $ 369,454.83 (319,777.46 end of 2013) Boatslip $ 105,950.81 (127,838.81 end of 2013) Restricted Funds Septic Inspection $ 1,221.68 Grinder Pump Inspection $ 0.00 Total Special Funds $ 476,627.32

Reserves Concept: Why Reserves are Needed? Plan and accrue funds for future expense Minimize need for special assessments Best practice based on 80% of funds building against projected need timetable Contingency reserve minimum 10% of other lot owner reserves

Expenditure Comments: $17,150.00 from parking lot reserve delayed to 2015 per Roads committee recommendation $5704.00 insurance x2 due to late 2013 invoicing Road repair $4214.00 above budget Entry monument and club stone repaired $2960.00 Drainage at club $1269.50

Lot Owner Revenue 2014 Budget 2014 Actual 2015 Budget   Annual Assessment $223,299 $223,202.00 $223,202 Other Income $0 $105.05 Fees & Special Assessments $2,646.01 $500 HOA Interest Income $549 $269.38 $310 ACC Income $7,625 $9,635.92 $10,230 Reserve Transfers: Pool Reserve $0.00 $3,200 Roads Reserve $8,000 Parking Lot Reserve $17,150 Total Lot Owner Revenue $248,623 $235,858.36 $262,592

Lot Owner 2014 Budget   2014 Actual 2015 Budget Total Revenue $248,623 $235,200 $262,592 Landscape Expense $75,500 $67,463 $70,450 Roads & Parking Lot $49,250 $33,489 $57,350 Club Expense $26,820 $25,780 $30,390 Security and Technology - $1,000 Administrative Expense $36,541 $39,940 $41,062 Operating Expenses $14,912 $21,195 $21,340 Reserve Expense $45,600 $47,993 $41,000 Total Expense Boat Slip Revenue $94,264 $89,842 $94,040 Boat Slip Expense

Landscape Expense 2014 Budget 2014 Actual 2015 Budget   2014 Actual 2015 Budget Landscape Maintenance $39,000 35,014 Unplanned Maintenance $1,000 3,777 $1,500 Shoulder Mowing $14,400 13,899 $14,800 Shoulder Improvements (SP) $10,000 4,419 $4,500 Shoulder Vegetation Overhang $1,200 672 Irrigation Maintenance 1,903 Trail Maintenance $1,450 192 Meadow Services $2,550 3,070 Water-Utility $3,300 3,681 Electricity (9421,8116) $1,100 836 Total Landscape $75,500 67,463 $70,450

Total Roads & Parking Lot 2014 Budget   2014 Actual 2015 Budget Road Maintenance $11,500 15,714 D/C Shoulder Services $6,000 5,401 $5,600 Snow & Ice Services $1,500 340 Lighting(2319,2478,0842) $13,100 12,034 $13,600 Parking Lot - Stage "a" $17,150 D/C Road Ditch Clearing $8,000 Total Roads & Parking Lot $49,250 33,489 $57,350

Club Expense 2014 Budget 2014 Actual 2015 Budget Club Maintenance   2014 Actual 2015 Budget Club Maintenance $2,000 1,802 Clubhouse drainage maint. $1,500 3,183 $0 Clubhouse stair handrail repair $500 84 Club equipment storage container $1,000 320 Clubhouse Acoustic Panels $600 Clubhouse Deck Seal & Repair $2,500 Pool Maintenance $11,500 10,322 Pool Filter and Pool Deck Repair $3,200 Pool Unplanned Services $250 627 $800 Clubhouse Unplanned Maint. 1,051 Clubhouse Telephone $720 770 Club House Pump Inspection $190 187 Water-Club House $2,310 1,422 $1,900 Electricity-Club House(6326) $4,000 4,558 $4,500 Security and Technology 252  $1000 Trash Dumpster $1,600 1,203 $1,400 Total Club Expense $26,820 25,780 $30,390

Boat and Clubhouse Trash?

Total Operating Expense Administrative Expense 2014 Budget   2014 Actual 2015 Budget Management Services $23,531 23,478 $24,002 Accounting Services $3,810 4,702 $4,650 ACC Services $9,200 11,760 $12,410 Total Administrative $36,541 39,940 $41,062 Operating Expenses Professional Services $3,000 3,141 CCR Amendments $0 183 Lock Box Fees $600 495 Misc./Discretionary Spending $1,600 1,813 $2,000 Postage/Printing/Copying 3,854 $3,200 Community Insurance $5,800 10,972 Income Taxes $312 285 $140 Community Activities 451 General Budget Contingency $0.00 Total Operating Expense $14,912 21,195 $21,340

Reserve Expense 2014 Budget 2014 Actual 2015 Budget   2014 Actual 2015 Budget Road Reserve Transfer $16,000 16,000 Parking Lot Reserve $4,500 4,500 Transfer to Sec & Tech $100 100 $500 Club Building Reserve Transfer $7,000 7,000 $3,000 Pool Reserve Transfer $6,000 6,000 Landscape Reserve $2,000 2,000 Annual Contingency Res Exp $10,000 12,393 $4,000 Total Reserve Expense $45,600 47,993 $41,000

Total Boat Slip Revenues Total Boat Slip Expense 2014 Budget   2014 Actual 2015 Budget Boat Slip Reserve Transfer $50,113 45,788 $50,000 Boat Slip- Interest Income $151 54 $40 Boat slip Assessment $44,000 44,000 Total Boat Slip Revenues $94,264 89,842 $94,040 Boat Slip Expense Boat slip Insurance $620 1,040 $550 Boat slip Maintenance $3,573 1,427 $1,820 Redecking (Four Annual Phases) Boat slip Income Taxes $86 15 $20 Electrical Repairs $100 Dock Lease $13,500 13,500 Electricity-Utility(1342) $960 999 $1,100 Walkway Clean & Stain - Phase I $1,500 Transfer to Boat slip Reserve $23,900 23,900 Transfer of Surplus to Reserve $0 1,685 Administrative Services $1,412 1,488 $1,550 Total Boat Slip Expense

2015 Revenue Concerns 10 of 2015 assessments unpaid (2 @ end March 2014) Second late notices issued Lien required on property early April

Additional Questions & Comments