THE PARKSHORE CONDOMINIUM ASSOCIATION. Financial Statements December 31, 2017 and 2016

Transcription

1 THE PARKSHORE CONDOMINIUM ASSOCIATION Financial Statements December 31, 2017 and 2016

2 THE PARKSHORE CONDOMINIUM ASSOCIATION FINANCIAL STATEMENTS DECEMBER 31, 2017 AND 2016 TABLE OF CONTENTS PAGE(S) Independent Auditors Report 3 4 Balance Sheets 5 Statements of Revenues, Expenses and Changes in Fund Balance 6 Statements of Cash Flows 7 Notes to Financial Statements 8 12 Supplementary Information Schedules of Operating Revenues and Expenses Schedules of Garage Revenues and Expenses 17 Supplementary Information on Future Major Repairs and Replacements 18 20

3 INDEPENDENT AUDITORS REPORT Board of Directors The ParkShore Condominium Association Chicago, Illinois Report on the Financial Statements We have audited the accompanying financial statements of The ParkShore Condominium Association (an Illinois nonprofit corporation) (the Association ), which comprise the balance sheets as of December 31, 2017 and 2016, and the related statements of revenues, expenses and changes in fund balance and cash flows for the years then ended, and the related notes to financial statements. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of The ParkShore Condominium Association as of December 31, 2017 and 2016, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

4 Report on Summarized Comparative Information We have previously audited The ParkShore Condominium Association s 2016 financial statements, and our report dated July 10, 2017 expressed an unmodified opinion on those financial statements. In our opinion, the summarized comparative information presented herein as of and for the year ended December 31, 2016, is consistent, in all material respects, with the audited financial statements from which it has been derived. Report on Supplementary Information Our audits were conducted for the purpose of forming an opinion on the financial statements as a whole. The schedules of operating revenues and expenses and garage revenues and expenses on pages are presented for purposes of additional analysis and are not a required part of the financial statements. Such information is the responsibility of the Association s management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audits of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole. Disclaimer of Opinion on Required Supplementary Information Accounting principles generally accepted in the United States of America require that the information on future major repairs and replacements on pages be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Financial Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audits of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Schaumburg, Illinois September 24, 2018

5 THE PARKSHORE CONDOMINIUM ASSOCIATION 5 BALANCE SHEETS DECEMBER 31, 2017 AND 2016 See notes to financial statements. ASSETS Operating Fund Reserve Fund Total Total CURRENT ASSETS Cash and cash equivalents Cash $ 179,654 $ 806,256 $ 985,910 $ 417,246 Garage cash 118, ,974 77,410 Certificates of deposit 818, , ,385 Accounts receivable, net of allowance for doubtful accounts of $12,571 in 2017 and ,413 15,413 7,790 Refuse rebate receivable 36,225 36,225 36,225 Interest receivable 4,295 4,295 4,295 Prepaid expenses 92,364 92, ,236 Interfund receivable 297, , ,613 Total current assets 442,630 1,926,502 2,369,132 1,694,200 PROPERTY AND EQUIPMENT Condominium unit 201, , ,358 Building equipment and furniture 183, , ,112 Less: accumulated depreciation (325,838) (325,838) (315,931) Net property and equipment 58,632 58,632 68,539 OTHER NONCURRENT ASSETS Refuse rebate receivable 47,850 47,850 48,000 LIABILITIES AND FUND BALANCE $ 549,112 $ 1,926,502 $ 2,475,614 $ 1,810,739 CURRENT LIABILITIES Accounts payable $ 128,468 $ 408,680 $ 537,148 $ 495,502 Prepaid assessments 30,022 30,022 51,982 Accrued payroll 34,100 34,100 58,902 Accrued expenses 58,954 58,954 25,778 Interfund payable 297, , ,613 Total current liabilities 549, , , ,777 FUND BALANCE 1,517,822 1,517,822 1,043,962 $ 549,112 $ 1,926,502 $ 2,475,614 $ 1,810,739

6 THE PARKSHORE CONDOMINIUM ASSOCIATION 6 STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE YEARS ENDED DECEMBER 31, 2017 AND 2016 See notes to financial statements Operating Fund Reserve Fund Total Total REVENUES Assessments $ 4,469,613 $ $ 4,469,613 $ 4,341,538 Parking garage revenue 407, , ,563 Balcony assessment 40,284 Commercial rent 53,218 53,218 53,289 Interest income 9,665 9,665 10,296 Other income 441, , ,118 Total revenues 5,370,852 9,665 5,380,517 5,134,088 EXPENSES Payroll and related 1,591,227 1,591,227 1,591,926 Administrative 188, , ,268 Utilities 762, , ,504 Building services 445, , ,196 Repairs and maintenance 417, , ,126 Other 184, , ,605 Parking garage expenses 665, , ,643 Major repairs and replacements 651, ,377 1,595,860 Total expenses 4,255, ,377 4,906,657 5,865,128 EXCESS (DEFICIT) OF REVENUES OVER EXPENSES 1,115,572 (641,712) 473,860 (731,040) MONTHLY CAPITAL CONTRIBUTIONS (1,017,757) 1,017,757 TRANSFER OF EXCESS OPERATING INCOME (97,815) 97,815 FUND BALANCE AT BEGINNING OF YEAR 1,043,962 1,043,962 1,775,002 FUND BALANCE AT END OF YEAR $ $ 1,517,822 $ 1,517,822 $ 1,043,962

7 THE PARKSHORE CONDOMINIUM ASSOCIATION 7 STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2017 AND 2016 See notes to financial statements Operating Fund Reserve Fund Total Total CASH FLOWS FROM OPERATING ACTIVITIES Excess (deficit) of revenues over expenses $ 1,115,572 $ (641,712) $ 473,860 $ (731,040) Adjustments to reconcile excess (deficit) of revenues over expenses to net cash provided by (used in) operating activities Depreciation 9,907 9,907 10,215 Changes in assets and liabilities Accounts receivable (7,623) (7,623) 30,252 Refuse rebate receivable ,075 Prepaid expenses 11,872 11,872 (9,205) Accounts payable (2,834) 44,480 41,646 47,347 Prepaid assessments (21,960) (21,960) 13,005 Accrued payroll (24,802) (24,802) 23,693 Accrued expenses 33,176 33,176 (9,988) Net cash provided by (used in) operating activities 1,113,458 (597,232) 516,226 (589,646) CASH FLOWS FROM FINANCING ACTIVITIES Interfund borrowings 65,140 (65,140) Interfund transfers (1,017,757) 1,017,757 Net cash provided by (used in) financing activities (952,617) 952,617 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 160, , ,226 (589,646) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 137,787 1,269,254 1,407,041 1,996,687 CASH AND CASH EQUIVALENTS AT END OF YEAR $ 298,628 $ 1,624,639 $ 1,923,267 $ 1,407,041 CASH AND CASH EQUIVALENTS COMPOSITION Cash $ 179,654 $ 806,256 $ 985,910 $ 417,246 Garage cash 118, ,974 77,410 Certificates of deposit 818, , ,385 $ 298,628 $ 1,624,639 $ 1,923,267 $ 1,407,041

8 THE PARKSHORE CONDOMINIUM ASSOCIATION NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2017 AND 2016 NATURE OF OPERATIONS The ParkShore Condominium Association (the Association ), incorporated on June 28, 1995, is a not-for-profit corporation, organized under the laws of the State of Illinois as provided in the Condominium Property Act, and is subject to the terms and conditions of the Declaration of Condominium Ownership. The Association serves as a means through which unit owners collectively administer, manage, operate and control the common area condominium property. The property is located in Chicago, Illinois and consists of 483 residential units in a 56-story high-rise building. The ParkShore building includes three commercial units, which are assessed their proportionate share of common area maintenance ( CAM ) costs in accordance with an operating agreement. CAM reimbursements include utilities, insurance and various repair and maintenance costs, as defined by the agreement. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting: The financial statements reflect the assets, liabilities, revenues and expenses of the Association on the accrual basis of accounting. The Association's governing documents provide certain guidelines for its financial activities. To ensure observance of limitations and restrictions on the use of financial resources, the Association maintains its accounts using fund accounting. These financial statements segregate funds as either operating or reserve. The operating fund is used to account for financial resources available for the general operations of the Association. The reserve fund is used to accumulate financial resources designated for major repairs and replacements. Cash and Cash Equivalents: Cash and cash equivalents consist primarily of checking, money market accounts, and highly liquid investments (including certificates of deposit) held at various financial institutions. Assessments: Association unit owners are subject to assessments to provide funds for the Association's operating expenses, future capital acquisitions, and major repairs and replacements. Accounts receivable at the balance sheet date represent fees due from unit owners. Prepaid assessments are recorded as a liability at the balance sheet date, as such amounts are deferred from revenue recognition until the subsequent period for which they pertain. Any excess assessments at year end are retained by the Association for use in future years. Receivables and Credit Policies: Accounts receivable are stated at the amount billed to the unit owners. The Association s policy is to retain legal counsel and place liens on the properties of homeowners whose assessments are significantly delinquent. The carrying amount of accounts receivable is reduced by a valuation allowance that reflects management's best estimate of the amounts that will not be collected. Management individually reviews all accounts receivable balances and, based on an assessment of current credit worthiness, estimates the portion, if any, of the balance that will not be collected. Property and Equipment: Real property and common areas acquired from the developer and related improvements to such property are not reflected on the Association's financial statements. Those properties are owned by the individual owners in common and not by the Association. It is the Association's responsibility to preserve and maintain the common areas. Property and equipment acquired by the Association is capitalized at cost and depreciated using the straight-line method over the estimated useful lives of the assets, which range from 5 to 27.5 years.

9 THE PARKSHORE CONDOMINIUM ASSOCIATION NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2017 AND 2016 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Maintenance and Repairs: Consistent with the nature of the organization, normal operating expenses incurred for repairs and improvements to the common elements are included in the operating fund. Major capital repairs and replacements resulting from actions of the Board of Directors are included in expenses of the reserve fund. Income Taxes: Condominium associations may elect to be taxed as regular corporations or as homeowners' associations. The Association elected to be taxed as a homeowners association for the years ended December 31, 2017 and Under that election, the Association is not taxed on income related to its exempt purpose, which is the management, maintenance and care of Association property. The Association is generally taxed only on its nonexempt function income (including interest income, rental income and other user fees), net of related expenses, at applicable federal and state corporate rates. An analysis of operations indicates no income tax was due for the years ended December 31, 2017 and 2016, due to operating losses for tax purposes. The Association has approximately $2,675,000 of Illinois net operating loss carryforwards, expiring in various years from 2018 through 2029, to apply against future Illinois taxable income. Deferred tax assets arising from the benefit of these net operating loss carryforwards totaling approximately $254,000 are offset by a corresponding valuation allowance, as the Association believes that it is not probable that the Illinois net operating loss carryforwards will be utilized. The valuation allowance increased by approximately $64,000 during Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Subsequent Events: Management has evaluated subsequent events through September 24, 2018, the date the financial statements were available to be issued. RESERVES FOR FUTURE MAJOR REPAIRS AND REPLACEMENTS The Association's governing documents require funds to be accumulated for future major repairs and replacements. These funds are held in separate money market accounts and certificates of deposit and are to be used for the repair and replacement of common areas only. It is the Association's policy to allocate interest earned on such funds to the reserve fund. The reserve fund balance totaled $1,517,822 and $1,043,962 at December 31, 2017 and 2016, respectively. The Association obtained a reserve study in October 2013 to estimate the remaining useful lives and the replacement costs of the common property components. The Association is funding for such major repairs and replacements over the estimated useful lives of the components based on the study's estimates of future replacement costs, considering amounts previously accumulated in the reserve fund. Actual expenses, however, may vary from the estimated amounts and the variations may be material. Therefore, amounts accumulated in the reserve fund may not be adequate to meet future needs. If additional funds are needed, however, the Association has the right to increase regular assessments, levy special assessments, or it may delay major repairs and replacements until funds are available.

10 THE PARKSHORE CONDOMINIUM ASSOCIATION NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2017 AND 2016 INTERFUND TRANSACTIONS Transactions occurred in 2017 and 2016 between the operating and reserve funds in the normal course of operations. Interfund transactions include the transfer of the operating fund surplus or deficit to or from the reserve fund. Excess operating income of $97,815 in 2017 is to be transferred to reserves in The operating deficit of $110,760 in 2016 was transferred from reserves to the operating fund in A total of $297,568 and $134,613 was due from the operating fund to the reserve fund at December 31, 2017 and 2016, respectively, as included in the accompanying balance sheets. The Association is funding for future major repairs and replacements through monthly assessments. The Association budgeted and transferred a total of $1,017,757 and $925,000 to the reserve fund in the years ended December 31, 2017 and 2016, respectively. COMMERCIAL LEASES The Association, in the capacity as lessor, has executed leases with various commercial entities, including a cleaner, a spa facility, a tenant lease, and a roof antenna. The Association executed a lease with the owner of the cleaners through December 31, The Association receives monthly rent of $500 over the term of the lease. Rent payments totaled $6,000 during each of the years ended December 31, 2017 and The Association has executed a lease with the spa owner, with a current expiration of May 31, This lease provides for monthly rentals of $1,530 for the first year, $1,561 for the second year, and $1,592 for remainder of the lease term. Rent payments totaled $18,949 and $18,577 during the years ended December 31, 2017 and 2016, respectively. The Association executed a lease with a tenant to rent a unit through May 31, This lease includes monthly rentals of $1,650 through December 31, 2016 and increases to $1,675 through December 31, 2017 and $1,700 for the remainder of the lease. Rent payments totaled $20,100 and $19,800 during the years ended December 31, 2017 and 2016, respectively. The Association executed a lease agreement with a telecommunications company, for use of the Association s roof for an antenna. The original lease term ends October 2020 with renewal options for five additional terms of five years each. The Association will receive monthly rent in the amount of $743 over the term of the lease. Rent payments totaled $8,912 during the years ended December 31, 2017 and Approximate minimum rental payments on all commercial leases subsequent to December 31, 2017 are as follows: Years Ending December 31, Amounts 2018 $ 42, , ,644 $ 85,176

11 THE PARKSHORE CONDOMINIUM ASSOCIATION NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2017 AND 2016 BALCONY ASSESSMENT The Association incurred costs to refinish balcony railings while performing façade repairs in A total of $40,284 was billed back to the owners benefiting from the project in August These amounts are included in the reserve fund in MAJOR REPAIRS AND REPLACEMENTS Major repairs and replacement expenses for the years ended December 31, 2017 and 2016 were as follows: Facade repairs $ 12,351 $ 739,256 Elevator project 163, ,499 Water supply system 28, ,500 Cooling tower replacement 76,792 - Heat exchangers - 41,777 Davits and safety tie outs 31,681 - Exterior painting 22,700 - Plumbing repairs - 27,565 Front entry doors 247,376 26,638 Electronic communication platform 23,125 - Fire protection - 21,934 Lobby renovations - 18,319 Chiller project - 18,081 Pool deck 15,470 - Laundry room - 15,380 Two-way radios 13,846 - Garage repairs and equipment - 13,407 Electrical - 13,006 Pool project - 12,044 Party room 10,375 - Exercise equipment - 9,323 Driveway project - 8,638 Video system / security upgrades 6,487 3,715 Miscellaneous $ 651,377 $ 1,595,860

12 THE PARKSHORE CONDOMINIUM ASSOCIATION NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2017 AND 2016 UNION AGREEMENTS Maintenance Employees The Association participates in a multiemployer defined benefit pension plan covering its union employees. The risks of participating in a multiemployer plan differs from single-employer plans. The potential risks include, but are not limited to, the use of the Association s contributions to provide benefits to employees of other participating employers, the Association becoming obligated for other participating employers unfunded obligations, and, upon the Association s withdrawal from the plan, the Association being required to pay the plan an amount based on the underfunded status of the plan, referred to as a withdrawal liability. The plan in which the Association participated for the years ended December 31, 2017 and 2016 is summarized below. The certified zone status (as defined by the Pension Protection Act) included in the table below represents the level at which the plan is funded and is based on the certified information received from the plan. The latest certified zone status is for the plan s year end in Among other factors, plans in the red zone generally are less than 65% funded, plans in the yellow zone are less than 80% funded, and plans in the green zone are at least 80% funded. The Association does not intend to withdraw from the plan. Name of Plan Employer ID Number Expiration Date of Collective Bargaining Agreement Certified Zone Status Financial Improvement/ Rehabilitation Plan Status Surcharge Imposed Contributions Made 2017 S.E.I.U. Local No. 1 Pension Trust Fund /30/19 Green No No $ 33, S.E.I.U. Local No. 1 Pension Trust Fund /30/17 Green No No $ 30,877 Doorstaff Employees The Association participates in the S.E.I.U. Local 1 401(k) plan for the doorstaff employees. The Association made contributions to the plan totaling $10,477 and $10,928 during the years ended December 31, 2017 and 2016, respectively.

13 SUPPLEMENTARY INFORMATION

14 THE PARKSHORE CONDOMINIUM ASSOCIATION 14 SCHEDULES OF OPERATING REVENUES AND EXPENSES YEARS ENDED DECEMBER 31, 2017 AND (UNAUDITED) BUDGET ACTUAL ACTUAL REVENUES Assessments $ 4,469,612 $ 4,469,613 $ 4,341,538 Parking garage revenue 414, , ,563 Commercial rent 53,960 53,218 53,289 Other income Service fees 20,000 11,250 15,038 Laundry income 15,000 13,801 13,630 Resident reimbursements 45,000 37,202 52,556 Late fees 8,000 8,110 7,710 Key charges and lockout fees 9,500 9,001 7,861 Cable television revenue 317, , ,200 Bicycle room fees 21,500 14,950 13,575 Maintenance income 20,000 21,437 25,029 Labor charge income 17,000 10,067 14,555 Miscellaneous 6,000 8,662 6,964 Total other income 479, , ,118 Total operating revenues 5,417,556 5,370,852 5,083,508 EXPENSES Payroll and related Office payroll 273, , ,714 Payroll processing fees 7,200 8,049 7,826 Payroll taxes 116,300 98,753 99,986 Office employee benefits 48,250 45,612 39,361 Association unit 9,000 8,945 8,689 Doorstaff payroll 311, , ,064 Doorstaff union benefits 80,400 79,505 78,893 Maintenance payroll 654, , ,778 Maintenance union benefits 149, , ,615 Total payroll and related 1,650,450 1,591,227 1,591,926

15 THE PARKSHORE CONDOMINIUM ASSOCIATION 15 SCHEDULES OF OPERATING REVENUES AND EXPENSES YEARS ENDED DECEMBER 31, 2017 AND (UNAUDITED) BUDGET ACTUAL ACTUAL EXPENSES (CONTINUED) Administrative Advertising 300 Office supplies 5,500 7,209 5,528 Office equipment 2,000 1,441 1,206 Copier 3,650 4,703 5,354 Postage 7,500 6,956 10,718 Printing 4,000 2,232 5,115 Telephone 12,500 18,011 20,948 Management fee 89,280 89,280 89,280 Audit fee 8,000 8,350 8,730 Legal 10,000 12,171 45,686 Professional fees 20,000 4,211 5,782 Employee training 8,900 1,642 4,440 Board meeting Social committee 22,000 25,593 22,257 Children's exploratory committee 1, Dues and subscriptions Licenses and fees 6,000 4,769 5,152 Total administrative 201, , ,268 Utilities Electricity 452, , ,996 Water 194, , ,535 Gas 93,450 97,596 99,711 Gas delivery 96,785 85,193 94,262 Total utilities 836, , ,504 Building services Refuse removal 37,000 51,116 43,734 Cable television 317, , ,786 Exterminating 3,000 2,328 2,472 Health club 10,000 6,723 10,669 Doorstaff uniforms 1,200 8,885 2,230 Security 1,700 1,743 1,622 Security equipment 3,000 4,994 9,897 Elevator maintenance 5,150 6,140 56,842 Common area repairs 10,000 11,449 19,133 Snow and ice removal 4, ,307 Fire protection equipment 27,000 44,720 34,504 Total building services 419, , ,196

16 THE PARKSHORE CONDOMINIUM ASSOCIATION 16 SCHEDULES OF OPERATING REVENUES AND EXPENSES YEARS ENDED DECEMBER 31, 2017 AND (UNAUDITED) BUDGET ACTUAL ACTUAL EXPENSES (CONTINUED) Repairs and maintenance Cleaning supplies 13,500 10,740 12,422 Carpet and floor cleaning 21,000 14,485 20,942 Loading dock maintenance 4,000 3,764 6,740 Common area maintenance 8,000 11,079 9,288 Metal maintenance 6,000 7,436 1,592 General maintenance supplies 12,000 17,107 16,540 Lobby plant service 15,750 12,713 8,062 Locks and keys 7,000 5,972 8,426 Light bulbs 4,000 1,530 4,835 Maintenance uniforms 7,500 12,106 20,345 Window washing 31,500 20,685 34,260 Resident repair materials 24,000 30,803 18,496 HVAC contract 53,500 29,986 51,600 HVAC repairs and maintenance 50,000 45,343 58,157 Plumbing repairs and maintenance 50,000 87,783 37,402 Electric repairs 13,000 27,905 5,196 Roof repairs 1, (1,535) Garage door repairs 3,500 2,379 Garage repairs and maintenance 5,000 6,990 12,195 Windows and screens 20,000 6,240 18,316 Maintenance equipment 2,700 2,965 4,852 Interior repairs 10,000 11,718 1,820 Landscaping 27,000 21,832 31,386 Pool chemicals and supplies 10,000 23,560 9,015 Recreational facilities maintenance 2,500 1,945 5,774 Total repairs and maintenance 402, , ,126 Other Workers compensation insurance 31,200 30,711 29,942 Property and liability insurance 144, , ,426 Insurance claims, net 6,022 Depreciation 9,907 10,215 Bad debts (recoveries) 10,000 Contingency fund 43,150 Total other 228, , ,605 Parking garage expenses 660, , ,643 Total operating expenses 4,399,799 4,255,280 4,269,268 EXCESS OF REVENUES OVER EXPENSES $ 1,017,757 $ 1,115,572 $ 814,240

17 THE PARKSHORE CONDOMINIUM ASSOCIATION 17 SCHEDULES OF GARAGE REVENUES AND EXPENSES YEARS ENDED DECEMBER 31, 2017 AND (UNAUDITED) BUDGET ACTUAL ACTUAL GARAGE REVENUES Monthly parking assessments $ 264,600 $ 263,529 $ 190,320 Transient parking 149, , ,142 Other , , ,563 GARAGE EXPENSES Payroll 397, , ,821 Payroll taxes 46,900 49,109 46,631 Health, welfare and pension 147, , ,569 Uniforms 3,000 1,206 2,109 Repairs and maintenance 5,100 6,050 5,766 Supplies 2, Auto damages 4,000 3,227 3,420 Liability insurance 550 Workers compensation insurance 18,500 20,545 48,040 Data processing 2,800 2,766 2,677 Management fee 20,100 20,051 19,467 Printing 1,400 1,372 2,049 Licenses and permits 2,300 2,341 Telephone 4,900 3,664 5,427 General expenses 500 2, Accounting fees 2,400 2,400 2,400 Bank charges 800 1, , , ,643 DEFICIT OF GARAGE REVENUES OVER EXPENSES $ (245,500) $ (258,453) $ (312,080)

18 THE PARKSHORE CONDOMINIUM ASSOCIATION 18 SUPPLEMENTARY INFORMATION ON FUTURE MAJOR REPAIRS AND REPLACEMENTS (UNAUDITED) DECEMBER 31, 2017 AND 2016 An independent consultant conducted a reserve study in October 2013 to estimate the remaining useful lives and replacement costs of the components of common property. Replacement costs were based on the estimated future costs to repair or replace the common property components at the time of the study and do not consider the effects of inflation. The replacement costs and useful lives on pages have been derived from the 2013 study. The Association has not designated funds for any specific component.

19 THE PARKSHORE CONDOMINIUM ASSOCIATION 19 SUPPLEMENTARY INFORMATION ON FUTURE MAJOR REPAIRS AND REPLACEMENTS (UNAUDITED) ANNUAL EXPENDITURE SCHEDULE

20 THE PARKSHORE CONDOMINIUM ASSOCIATION 20 SUPPLEMENTARY INFORMATION ON FUTURE MAJOR REPAIRS AND REPLACEMENTS (UNAUDITED) ANNUAL EXPENDITURE SCHEDULE