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| SUN LAKES LIFESTYLES | MARCH 2018 | 9 Treasurer's Report By John Clark BOTTOM LINE: Many of you are aware that there was a major software issue at the Associa Corporate office that has affected the closing of the books for 2017. The following commentary is based upon what is currently available. The year-end numbers are preliminary, and are being reviewed by our new auditing firm. Having said that, the year ended with a surplus of $193,950.31. With the exception of one year, this is the smallest surplus since 2008. Note: The January 2018 financials were not available at the time this article went to the publisher. NON-OPERATIONS: The final count on homes closing escrow during the year is 170. The plan for the year anticipated 223. The 53 unit shortfall resulted in a loss of income to the Association of $53,350. Interest income was $12,485 better than the modest plan of $100,000. The plan for 2018 is $115,000. IN TOTAL: All three cost centers, HOA, Golf and F&B, came in with income higher than the plan and expenses lower than the plan for the year except for Golf expense which overshot its $2,199,044 budget by $12,262. REVENUE: Revenue in December (and the year) was boosted by $90,000 due to an accounting adjustment. General Manager Mitchell, who is a CPA, has been reviewing past accounting practices. Going back several years, he uncovered an error in the accounting methodology for gate transponders. The $90,000 addition to income compensates for the accumulated errors. EXPENSE: The following are some quick comments on major expense items (numbers have been rounded). The Association's largest expense is for salaries/wages and employee benefits which were budgeted at $4,000,000. Preliminary numbers show a savings of $175,000 or 4.5 percent. Irrigation water and power for the golf courses and common areas was budgeted at $1,250,000. There was a savings here of $28,000 or 2 percent. The budget for 2017 restaurant food expense was set at 40 percent of restaurant revenue. The budgeted number is now generally considered as being overly optimistic. Final numbers are 45 percent or $70,000 over a budget adjusted for the higher revenue this year. The budget for 2018 has been set at 45 percent of restaurant revenue as food costs are expected to continue their increase. TOTAL FUNDS: As can be seen from the table, there is relatively little change in the total after twelve months, although shuffling did occur between accounts, e.g., funding the BoE Tax Liability Reserve from Unallocated HO Equity. FINALLY: Onward and upward! Comments: jdclark@dc.rr.com.

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