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| SUN LAKES LIFESTYLES | NOVEMBER 2023 | 7 The Association had a loss (Expenses exceeded revenue) in August of $91,501 and a year-to-date surplus of $140,530 (see table below). The Association has done better than budget in all departments except Restaurant and Lounge. In the case of the golf course there has been a $840,317 loss so far this year. The budgeted loss for the golf course for the full year is $1,651,214. Through eight months the budgeted loss would be $1,100,809 ($1,651,214 divided by 12, times 8), the actual loss is $840,317, resulting in a positive variance of $260,492. At the end of August, the balance in the Operating Fund checking account was $697,302. On that same date the Association had outstanding bills of $1,191,593. If accounts receivable (primarily amounts due from members house accounts) and cash are combined outstanding bills exceed cash and receivables by $14,470 (see the graphic below). In addition to the cash in the Operating Fund the Association had cash and investments in the Repair & Replacement Fund of $12,211,381 and $1,588,024 in the Capital Improvement Fund. The Repair and Replacement Fund and the Capital Improvement Funds are restricted funds and cannot be used to pay for the daily operations of the Association The Sun Lakes Country Club (SLCC) Association has three Funds; the Operating Fund, Reserve & Replacement Fund (R&R Fund) and the Capital Improvement Fund (CIF). These funds are segregated from each other on the books and records of the Association. The Associations CC&Rs address each of these funds separately both in how they are funded and how they can be used to pay for expenses of the Association. The Operating Fund, which receives the largest portion of the Members monthly HOA fees is used for all of the daily operations of the Association. These operations include maintenance of common areas, recreation, compliance, and supplementing the Golf and Restaurant amenities. The Repair & Replacement Fund is a separate Fund which can only be used to replace or repair existing assets of the association. The R & R Fund is funded each year through an allocation of the Members HOA fee. For 2023 the allocation is $2,100,000. The R & R Fund cannot be used to pay for day-to-day expenses of the Association. State law places restrictions on the use of Repair and Replacement Funds. This includes a required reserve study and limitations on the R & R Fund lending money to the Operating Fund. The Capital Improvement Fund is a restricted Fund and is used to fund new capital projects of the Association, such as a new building for example. The CIF was funded, for the most part, through prior year special assessments. ~ Gary Burkel, SLCC Treasurer, CPA-Retired TREASURER'S REPORT * THE OPERATING FUND IS USED TO MANAGE DAILY OPERATIONS OF THE HOA. IT DOES NOT INCLUDE CASH IN RESTRICTED FUNDS. THIS IS A BASIC TEST THAT MEASURES THE SUFFICIENCY OF THE CASH POSITION OF THE ORGANIZATION. SUMMARY OF AUGUST 2023 INCOME STATEMENT BY DEPARTMENT

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