southpark homeowners' association number 2 ... - Southpark HOA II
southpark homeowners' association number 2 ... - Southpark HOA II southpark homeowners' association number 2 ... - Southpark HOA II
SOUTHPARK HOMEOWNERS' ASSOCIATION NUMBER 2NOTES TO FINANCIAL STATEMENTSDECEMBER 31, 2008NOTE 4. FUTURE MAJOR REPAIRS AND REPLACEMENTS (continued)The Board conducted a study in December 2003, which has not been subsequentlyupdated, to estimate the remaining useful lives and the replacement costs of thecomponents of common property. The estimates were obtained from an independentengineering company which inspected the property. The table included in the unauditedsupplementary information on Future Major Repairs and Replacements is based on thestudy. The Board expects to update the study during 2009.The Board has been funding for major repairs and replacements over the remaininguseful lives of the components based on such study's estimates of current replacementcosts and considering amounts previously accumulated in the replacement fund, amongother factors.The determination of whether the Association has adequate funds to meet its needs forfuture major repairs and replacements is subject to several factors. The actual futureexpenditures and remaining useful lives may vary significantly from the estimates. Dueto operating fund needs and other factors, the Association may not be able to set asidefunds for future major repairs and replacements. Further, the rates of inflation andreturn on investments may significantly vary from expectations. Therefore, amountsaccumulated in the replacement fund may not be adequate to meet all future needs formajor repairs and replacements. If additional funds are needed, the Association has theright to increase regular assessments, pass special assessments, or delay major repairsand replacements until funds are available. The effect on future member assessmentsand the ability to fund future repairs and replacements is unknown at this time.During 2008, the Board authorized a loan of $35,000 from the Replacement Fund to theOperating Fund. By December 31, 2008, such loan had not been repaid.As of December 31, 2008, the cumulative budgeted Replacement Fund assessments,less expenditures, were more than the funds specifically allocated assets by $89,285.Subject to available cash balances, the Board intends to repay that amount to theReplacement Fund during 2009 and has, therefore, reflected it as an interfund receivableand payable.7
SOUTHPARK HOMEOWNERS' ASSOCIATION NUMBER 2NOTES TO FINANCIAL STATEMENTSDECEMBER 31, 2008NOTE 5. FEDERAL AND STATE CORPORATE INCOME TAXESThe Association may elect annually to file its income tax return as a regular corporationor as a homeowners association in accordance with Code Section 528.For the current year, as in recent years, the Association filed its income tax return as aregular corporation. In certain prior years, the Association had an excess of expensesfor the maintenance of the common property over membership source income. Thatexcess, in the amount of $121,092, was carried over to future periods to offset futureincome when it files as a regular corporation. Such loss carryover, after a partial 2008utilization, totals $95,835 at December 31, 2008.The Association's investment income and other non-exempt income were subject to tax,resulting in a liability of $4,451 as of December 31, 2008.NOTE 6. REAL PROPERTYAlthough this is not a title report or opinion, based on information provided, theAssociation appears to own the following properties:(a) Filing 7 Tract A: all land and improvements thereon which surroundLots 1-21 and Lots 68-146(b) Filing 7 Tract B: all land and improvements thereon which surroundLots 22-67(c) Filing 9 Tract A: all land and improvements thereon which surroundLots 1-190(d) Filing 9 Tract B: all land and improvements thereon which surround Lots191-293(e) Filing 9 Tract C: includes all open space/greenbelt area which isdesignated as a drainage easement and storm detention pond area(f) Filing 10 Tract A: all land and improvements thereon which surroundLots 1-56(g) Filing 3 Tract D: clubhouse, pool and tennis court(h) Private drives and parking areas between buildingsThe disposition and use of that property is restricted by the Association's governingdocuments. Each member of the Association has a beneficial or undivided interest insuch property.Additionally, West Long Drive, West Long Avenue, West Long Circle, and West LongCourt have been dedicated to the city.8
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SOUTHPARK HOMEOWNERS' ASSOCIATION NUMBER 2NOTES TO FINANCIAL STATEMENTSDECEMBER 31, 2008NOTE 5. FEDERAL AND STATE CORPORATE INCOME TAXESThe Association may elect annually to file its income tax return as a regular corporationor as a homeowners <strong>association</strong> in accordance with Code Section 528.For the current year, as in recent years, the Association filed its income tax return as aregular corporation. In certain prior years, the Association had an excess of expensesfor the maintenance of the common property over membership source income. Thatexcess, in the amount of $121,092, was carried over to future periods to offset futureincome when it files as a regular corporation. Such loss carryover, after a partial 2008utilization, totals $95,835 at December 31, 2008.The Association's investment income and other non-exempt income were subject to tax,resulting in a liability of $4,451 as of December 31, 2008.NOTE 6. REAL PROPERTYAlthough this is not a title report or opinion, based on information provided, theAssociation appears to own the following properties:(a) Filing 7 Tract A: all land and improvements thereon which surroundLots 1-21 and Lots 68-146(b) Filing 7 Tract B: all land and improvements thereon which surroundLots 22-67(c) Filing 9 Tract A: all land and improvements thereon which surroundLots 1-190(d) Filing 9 Tract B: all land and improvements thereon which surround Lots191-293(e) Filing 9 Tract C: includes all open space/greenbelt area which isdesignated as a drainage easement and storm detention pond area(f) Filing 10 Tract A: all land and improvements thereon which surroundLots 1-56(g) Filing 3 Tract D: clubhouse, pool and tennis court(h) Private drives and parking areas between buildingsThe disposition and use of that property is restricted by the Association's governingdocuments. Each member of the Association has a beneficial or undivided interest insuch property.Additionally, West Long Drive, West Long Avenue, West Long Circle, and West LongCourt have been dedicated to the city.8
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