MYRTLE BEACH AREA CHAMBER OF COMMERCE AND SUBSIDIARY CONSOLIDATED FINANCIAL STATEMENTS AND ADDITIONAL INFORMATION. Year Ended December 31, 2014

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1 CONSOLIDATED FINANCIAL STATEMENTS AND ADDITIONAL INFORMATION Year Ended December 31, 2014

2 TABLE OF CONTENTS December 31, 2014 Independent Auditors Report 1 Consolidated Financial Statements Consolidated Statement of Financial Position 3 Consolidated Statement of Activities 4 Consolidated Statement of Cash Flows 5 Notes to Consolidated Financial Statements 6 Additional Information Independent Auditors Report on Additional Information 12 Consolidating Statement of Financial Position 13 Consolidating Statement of Activities 14 Consolidating Statement of Cash Flows 20 Consolidated Schedule of Support, Revenues and Expenses - Budget and Actual 22 Page

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5 CONSOLIDATED STATEMENT OF FINANCIAL POSITION December 31, 2014 With Comparative Amounts for December 31, 2013 ASSETS Cash and Cash Equivalents $ 8,935,139 $ 8,649,754 Certificates of Deposit 27,058 26,936 Receivables (Net) 578, ,681 Prepaid Expenses 1,088, ,625 Inventories 3, Property and Equipment (Net) 1,224,291 1,371,736 Deferred Tax Asset 220, ,036 TOTAL ASSETS $ 12,078,137 $ 11,299,107 LIABILITIES AND NET ASSETS Liabilities Accounts Payable and Accrued Expenses $ 737,707 $ 888,015 Refundable Advances 3,394,701 3,198,572 Total Liabilities $ 4,132,408 $ 4,086,587 Net Assets Unrestricted $ 5,509,237 $ 2,641,299 Temporarily Restricted 2,436,492 4,571,221 Total Net Assets $ 7,945,729 $ 7,212,520 TOTAL LIABILITIES AND NET ASSETS $ 12,078,137 $ 11,299,107 The accompanying notes are an integral part of the financial statements

6 CONSOLIDATED STATEMENT OF ACTIVITIES Year Ended December 31, 2014 With Comparative Amounts for the Year Ended December 31, 2013 Temporarily Totals Totals Unrestricted Restricted Support and Revenues Public Support Local Governments $ $ 22,926,651 $ 22,926,651 $ 22,799,533 Grants and Promotions 5,657,379 5,657,379 6,145,659 Volume Based Member Contributions 1,083,731 1,083,731 1,000,974 Membership Dues 2,470,841 2,470,841 2,355,890 Advertising Sales 3,428,134 3,428,134 3,089,643 Member Services ,200 Programs and Events 220, , ,504 Other Revenue 3,120,866 3,120,866 3,493,950 Total Support and Revenues $ 10,324,430 $ 28,584,030 $ 38,908,460 $ 39,092,353 Net Assets Released From Restrictions $ 30,718,759 $ (30,718,759) $ $ Expenses Programs $ 32,651,353 $ $ 32,651,353 $ 34,272,195 Personnel 3,461,858 3,461,858 3,436,960 Operating 1,488,183 1,488,183 1,552,054 Facility 319, , ,136 Other Expenses 74,659 74, ,012 Total Expenses $ 37,995,902 $ $ 37,995,902 $ 39,856,357 Increase (Decrease) in Net Assets Before Income Taxes $ 3,047,287 $ (2,134,729) $ 912,558 $ (764,004) Provision for Income Taxes (Expense) Deferred Taxes (179,349) (179,349) (119,153) Increase (Decrease) in Net Assets $ 2,867,938 $ (2,134,729) $ 733,209 $ (883,157) Net Assets - Beginning 2,641,299 4,571,221 7,212,520 8,095,677 Net Assets - Ending $ 5,509,237 $ 2,436,492 $ 7,945,729 $ 7,212,520 The accompanying notes are an integral part of the financial statements

7 CONSOLIDATED STATEMENT OF CASH FLOWS Year Ended December 31, 2014 With Comparative Amounts for the Year Ended December 31, Cash Flows From Operating Activities Increase (Decrease) in Net Assets $ 733,209 $ (883,157) Adjustments to Reconcile Increase (Decrease) in Net Assets to Net Cash and Cash Equivalents Provided (Used) by Operating Activities Depreciation 160, ,805 Decrease in Receivables (Net) 6, ,377 (Increase) Decrease in Prepaid Expenses (823,103) 647,012 (Increase) Decrease in Inventories (3,325) 780 Decrease in Deferred Tax Asset 179, ,153 (Decrease) in Accounts Payable and Accrued Expenses (150,308) (142,295) Increase in Refundable Advances 196, ,190 Net Cash and Cash Equivalents Provided by Operating Activities $ 298,770 $ 502,865 Cash Flows From or (Used) by Investing Activities Purchases of Certificates of Deposit $ (27,058) $ (26,936) Maturities of Certificates of Deposit 26,936 26,670 Purchases of Property and Equipment (13,263) (104,712) Net Cash and Cash Equivalents (Used) by Investing Activities $ (13,385) 385) $ (104,978) Cash Flows From or (Used) by Financing Activities Proceeds from Notes Payable $ 4,000,000 $ 4,500,000 Repayments of Notes Payable (4,000,000) (4,500,000) Net Cash and Cash Equivalents From or (Used) by Financing Activities $ $ Net Increase in Cash and Cash Equivalents $ 285,385 $ 397,887 Cash and Cash Equivalents - Beginning 8,649,754 8,251,867 Cash and Cash Equivalents - Ending $ 8,935,139 $ 8,649,754 Supplemental Cash Flow Disclosure Interest Incurred and Paid $ 7,778 $ 11,306 The accompanying notes are an integral part of the financial statements

8 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2014 Page 1 of 6 Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation: The consolidated financial statements include the accounts of the Myrtle Beach Area Chamber of Commerce (the Chamber) and its wholly-owned subsidiary, the Myrtle Beach Area Commerce Center, Inc. (the Commerce Center). All material intercompany transactions and balances have been eliminated in the consolidation. Nature of Activities: The Chamber is a nonprofit organization whose purpose is to provide community leadership in the promotion of economic development, including tourism. The Chamber receives revenue primarily through state and local government grants, contributions and membership dues. The Chamber operates under the following divisions: finance/administration, membership and program services, festivals and special events, marketing, convention bureau and leadership grand strand. The Commerce Center s operations include an advertising agency and publication activities. The Commerce Center receives revenue primarily through the production and sale of promotional materials and services. Basis of Accounting: The accompanying consolidated financial statements have been prepared on the accrual basis of accounting. Basis of Presentation: The consolidated financial statement presentation follows the recommendations of the Financial Accounting Standards Board for Not-for-Profit Organizations. Under generally accepted accounting principles for not-for-profit organizations, the Chamber is required to report information regarding its financial position and activities according to three classes of net assets: unrestricted net assets, temporarily restricted net assets and permanently restricted net assets. Currently, the Chamber has no permanently restricted net assets, but the Board of Directors has designated reserves on a recurring basis as disclosed in Note 2. Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that directly affect the reported amounts of assets, liabilities, revenues and expenses. Actual results could differ from those estimates. Concentration of Credit Risk: The Organization maintains bank accounts with various financial institutions. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (FDIC insured) up to $250,000. At December 31, 2014, the bank s balances totaled $9,795,643 with an uninsured balance of $1,048,955, and the remaining balance of $8,219,477 is protected by the pledge of government securities held in the name of the financial institution for the Organization under certain overnight repurchase agreements utilized by the Organization. Cash Equivalents: The Organization considers all demand deposits, money market accounts and other highly liquid investments with original maturities of three months or less to be cash equivalents. Receivables consist primarily of support and amounts due in conjunction with the Organization s programs, services and events. All amounts are due during the year ending December 31, The Organization utilizes the allowance method to account for uncollectable accounts receivable. The Organization s estimate is based on historical collection experience and a review of the current status of specific accounts. Concentrations of credit risk with regard to receivables are limited due to the large number of accounts and their dispersion across different industries

9 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2014 Page 2 of 6 Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Prepaid Expenses are recognized when payments have been made for products or services that will not be used in operations until the following year. For the years ending December 31, 2014 and 2013, the prepaid expenses consist primarily of prepaid marketing and advertising. Inventories consist of merchandise held for resale, which are valued at cost on a first-in, first-out basis. Property and Equipment: All acquisitions of property and equipment in excess of $5,000 and all expenditures for repairs, maintenance, renewals and betterments that materially prolong the useful lives of assets are capitalized. Property and equipment are carried at cost or, if donated, at the approximate fair value at the date of donation. Depreciation is computed using primarily the straight-line method over the estimated useful lives of the related assets which are as follows: Land Land Improvements Buildings and Improvements Furnishings, Fixtures and Equipment N/A 15 years 31 to 39 years 3 to 8 years Investment in Internet Co-Op, LLC: The Organization has a 44% membership interest in the Myrtle Beach Area Internet Marketing Co-Op, LLC which is accounted for by the equity method. Under the equity method, the original cost of the investment is adjusted annually for the Organization s proportionate share of undistributed earnings or losses. As of December 31, 2014, the original cost of the investment has been adjusted to $0. Refundable Advances: The Organization receives advanced fees for services and programs. Such fees are subject to being refunded (in whole, or in part) prior to the date of service or event. Accordingly, these amounts have been reported as refundable advances at year-end. Support: Under generally accepted accounting principles for not-for-profit organizations, contributions are deemed to have been earned when the cash or other assets including securities, land, buildings, use of facilities, materials and supplies, intangible assets, services or unconditional promises to give such items in the future are received. An unconditional promise to give is a promise that is not dependent on the occurrence of a specified future event in order to bind the promisor. Contributions received and unconditional promises to give are measured at their fair values and are reported as an increase in net assets. All contributions are considered to be available for unrestricted use unless specifically restricted by the donor. The Organization reports gifts of cash and other assets as restricted support if they are received with donor stipulations that limit the use of the donated assets, or if they are designated as support for future periods. When a donor restriction expires, that is, when a stipulated time restriction ends or the purpose restriction is accomplished, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statement of activities as net assets released from restrictions. Donor-restricted contributions whose restrictions are met in the same reporting period are reported first as temporarily restricted net assets. Membership Dues are recognized when received. Payments received by the Organization for the subsequent year are recorded as temporarily restricted net assets

10 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2014 Page 3 of 6 Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Income Taxes: The Chamber is a nonprofit organization as described in Section 501(c)(6) of the United States Internal Revenue Code and is exempt from federal and state income taxes. Activities of the Commerce Center are subject to federal and state income taxes. The Chamber s wholly owned subsidiary is a taxable corporation that incurs income tax expense when its revenues from advertising sales exceed the costs of those taxable activities. In accounting for income taxes, the Organization follows generally accepted accounting principles. Deferred tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Prior-Year Information: The consolidated financial statements include prior-year summarized comparative information in total but not by net asset class. Such information does not include sufficient detail to constitute a presentation in conformity with generally accepted accounting principles. Accordingly, such information should be read in conjunction with the Organization s consolidated financial statements for the year ended December 31, 2013, from which the summarized information was derived. Note 2 - BOARD DESIGNATED RESERVES The following net assets have been designated by the Board of Directors for the following purposes at December 31, 2014: Marketing $ 5,000,000 Operating Fund 1,800,000 Medical Claims 500,000 Capital Projects 200,000 Contingencies 272,164 Leadership Grand Strand Alumni 41,437 Leadership Grand Strand 28,121 $ 7,841,722 Note 3 - RECEIVABLES (NET) Receivables consisted of the following at December 31, 2014: Volume Based Member Contributions $ 225,177 Program, Service and Event Related Amounts 353,393 $ 578,

11 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2014 Page 4 of 6 Note 4 - PROPERTY AND EQUIPMENT (NET) Property and equipment consisted of the following at December 31, 2014: Land and Improvements $ 352,294 Buildings and Improvements 2,073,259 Furnishings, Fixtures and Equipment 874,658 $ 3,300,211 Accumulated Depreciation (2,075,920) $ 1,224,291 Note 5 - ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consisted of the following at December 31, 2014: Trade Accounts $ 421,495 Accrued Salaries and Wages 74,958 Compensated Absences 241,254 $ 737,707 Note 6 - LINES OF CREDIT The Chamber has in place, two lines of credit with a total maximum available financing of $7,750,000, each with a variable interest rate based upon the 30 day Libor rate plus 1.75%. There are no outstanding balances on these credit lines at December 31, Interest expense for the lines of credit amounted to $7,778 during the twelve month period ended December 31, Note 7 - TEMPORARILY RESTRICTED NET ASSETS At December 31, 2014, temporarily restricted net assets consisted of the following: Local Government Funds $ 279,148 State Grants 2,157,344 $ 2,436,

12 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2014 Page 5 of 6 Note 7 - TEMPORARILY RESTRICTED NET ASSETS (continued) During the year ended December 31, 2014, net assets were released from restrictions by incurring expenses satisfying the purpose specified by the donors or by satisfaction of the time restrictions by the donors as follows: Satisfaction of Project / Program Restrictions Local Government Support Project and Program Services $ 22,799,470 Contingency Funds 57,506 South Carolina Department of Parks, Recreation and Tourism SCATR and Regional Tourism 190,786 State Proviso Matching Grant 7,670,997 Total Net Assets Released From Restrictions $ 30,718,759 Note 8 - LOCAL GOVERNMENT CONTINGENCY AGREEMENTS The Organization reserves approximately five percent of accommodations tax revenues received from the respective local governments. These amounts are to be used for future program (advertising and promotion of tourism) expenditures related to the specific funding locality. Activity within the local government contingency accounts during the year ended December 31, 2014, was as follows: Balance Balance 12/31/13 Additions Expenditures 12/31/14 City of Myrtle Beach, SC $ 176,619 $ 128,167 $ 54,506 $ 250,280 Town of Surfside Beach, SC 16,615 8,269 3,000 21,884 $ 193,234 $ 136,436 $ 57,506 $ 272,164 Note 9 - OPERATING LEASES The Organization leases real property and personal property under operating leases expiring in various years through Lease expense charged to operations for all significant operating leases was $46,844 for the year ended December 31, Minimum future rental payments under significant non-cancelable operating leases as of December 31, 2014 are as follows: Year Ending December 31, 2015 $ 23, ,907 $ 29,

13 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2014 Page 6 of 6 Note 10 - RETIREMENT PLAN The Organization has an Internal Revenue Code Section 401(k) plan for its eligible full-time employees who have been with the Organization for twelve months. Employer contributions to the plan during the year ended December 31, 2014 were $95,067, which represents a matching contribution of up to 5.0% of covered employees salaries. Note 11 - INCOME TAXES Effective January 1, 2009, the Organization implemented the new accounting requirements associated with uncertain tax positions using the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 740, Income Taxes. That guidance provides that a tax benefit from an uncertain tax position may be recognized when it is more-likely-than-not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. Income tax positions must meet a more-likely-than-not recognition threshold at the effective date to be recognized upon the adoption of the guidance and in subsequent periods. The Organization believes it has no uncertain tax positions as of December 31, 2014, and accordingly, no liability has been accrued. The Organization is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. Management believes it is no longer subject to income tax examinations for years prior to December 31, The Organization s deferred tax asset at December 31, 2014 arose from a net operating loss generated by the Commerce Center. Net operating losses can be carried forward for a total of twenty years. The Organization s net operating loss carryforward initially arose during the year ended December 31, 2010 and the total net operating loss carryforward at December 31, 2014 amounted to $649,078. Since the net operating loss carryforward is anticipated to be absorbed by taxable income prior to expiration, no valuation allowance has been established. Note 12 LITIGATION During its normal course of business, the Chamber is subject to potential claims and litigation. As of December 31, 2014, no litigation or lawsuits were pending. Additionally, although certain investigations are ongoing, the attorneys representing the Chamber advises that there are no unasserted claims or assessments for potential loss that need to be reported. Note 13 SUBSEQUENT EVENTS Subsequent events were evaluated through February 6, 2015, which is the date the financial statements were available to be issued

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16 CONSOLIDATING STATEMENT OF FINANCIAL POSITION December 31, 2014 ASSETS Myrtle Beach Myrtle Beach Consolidating Area Chamber Area Commerce & Eliminating Consolidated of Commerce Center, Inc. Adjustments Totals Cash and Cash Equivalents $ 8,391,021 $ 544,118 $ $ 8,935,139 Certificates of Deposit 27,058 27,058 Receivables (Net) 578,570 6,327 (6,327) 578,570 Due from Chamber 477,484 (477,484) Prepaid Expenses 1,088,728 1,088,728 Inventories 3,664 3,664 Property and Equipment (Net) 1,224,291 1,224,291 Investment in Internet Co-Op, LLC Investment in Commerce Center (428,322) 428,322 Deferred Tax Asset 220, ,687 TOTAL ASSETS $ 10,885,010 $ 1,248,616 $ (55,489) $ 12,078,137 LIABILITIES AND NET ASSETS / SHAREHOLDER'S EQUITY Liabilities Accounts Payable and Accrued Expenses $ 737,707 $ 6,327 $ (6,327) $ 737,707 Due to Commerce Center 477,484 (477,484) Refundable Advances 1,724,090 1,670,611 3,394,701 Total Liabilities $ 2,939,281 $ 1,676,938 $ (483,811) $ 4,132,408 Net Assets Unrestricted $ 5,509,237 $ $ $ 5,509,237 Temporarily Restricted 2,436,492 2,436,492 Total Net Assets $ 7,945,729 $ $ $ 7,945,729 Shareholder's Equity Common Stock $ $ 1,000 $ (1,000) $ Retained Earnings (429,322) 429,322 Total Shareholder's Equity $ $ (428,322) $ 428,322 $ TOTAL LIABILITIES AND NET ASSETS / SHAREHOLDER'S EQUITY $ 10,885,010 $ 1,248,616 $ (55,489) $ 12,078,

17 CONSOLIDATING STATEMENT OF ACTIVITIES Year Ended December 31, 2014 Myrtle Beach Area Chamber of Commerce Temporarily Unrestricted Restricted Total Support and Revenues Public Support Local Governments $ $ 22,926,651 $ 22,926,651 Grants and Promotions 5,657,379 5,657,379 Volume Based Member Contributions 1,083,731 1,083,731 Membership Dues 2,470,841 2,470,841 Advertising Sales Member Services Programs and Events 220, ,358 Other Revenue 3,120,866 3,120,866 Subsidiary Income 348, ,150 Total Support and Revenues $ 7,243,946 $ 28,584,030 $ 35,827,976 Net Assets Released From Restrictions $ 30,718,759 $ (30,718,759) $ Expenses Program Expenses Government - Designated Funds $ 57,506 $ $ 57,506 Advertising and Promotions 28,703,906 28,703,906 Publications 1,436,591 1,436,591 Programs and Events 357, ,358 Member Services 15,904 15,904 Convention and Group Sales 1,714,803 1,714,803 Retail Total Program Expenses $ 32,286,878 $ $ 32,286,878 Personnel Expenses Salaries and Wages $ 2,689,833 $ $ 2,689,833 Contract Labor 21,358 21,358 Payroll Taxes 201, ,479 Benefits 549, ,188 Cost Allocation (1,322,521) (1,322,521) Total Personnel Expenses $ 2,139,337 $ $ 2,139,

18 Page 1 of 3 Myrtle Beach Consolidating Area Commerce & Eliminating Consolidated Center, Inc. Adjustments Totals $ $ $ 22,926,651 5,657,379 1,083,731 2,470,841 4,100,364 (672,230) 3,428, ,358 3,120,866 (348,150) $ 4,100,864 $ (1,020,380) $ 38,908,460 $ $ $ $ $ $ 57, ,230 (672,230) 28,703,906 3,900 1,440, ,358 15, ,575 2,075, $ 1,036,705 $ (672,230) $ 32,651,353 $ $ $ 2,689,833 21, , ,188 1,322,521 $ 1,322,521 $ $ 3,461,

19 CONSOLIDATING STATEMENT OF ACTIVITIES Year Ended December 31, 2014 Myrtle Beach Area Chamber of Commerce Temporarily Unrestricted Restricted Total Expenses (continued) Operating Expenses Supplies and Equipment $ 90,035 $ $ 90,035 Postage and Freight 52,532 52,532 Telecommunications 91,890 91,890 Travel and Entertainment 196, ,680 Dues and Subscriptions 55,087 55,087 Meetings and Conferences 15,716 15,716 Training and Development 19,089 19,089 Professional and Contractual Services 151, ,085 Other Operating Expenses 56,581 56,581 Cost Allocation (297,439) (297,439) Total Operating Expenses $ 431,256 $ $ 431,256 Facility Expenses Utilities $ 44,974 $ $ 44,974 Facility Services 106, ,244 Lease and Rental Expenses 46,844 46,844 Insurance 77,724 77,724 Property Tax and Licenses 44,063 44,063 Cost Allocation (94,879) (94,879) Total Facility Expenses $ 224,970 $ $ 224,970 Other Expenses Depreciation $ 160,708 $ $ 160,708 Interest Expense 7,778 7,778 Bad Debt Expense (93,827) (93,827) Cost Allocation (62,333) (62,333) Total Other Expenses $ 12,326 $ $ 12,326 Total Expenses $ 35,094,767 $ $ 35,094,

20 Page 2 of 3 Myrtle Beach Consolidating Area Commerce & Eliminating Consolidated Center, Inc. Adjustments Totals $ $ $ 90, , ,618 91, ,680 55,087 15,716 19, ,085 8,402 64, ,439 $ 1,056,927 $ $ 1,488,183 $ $ $ 44, ,244 46,844 77,724 44,063 94,879 $ 94,879 $ $ 319,849 $ $ $ 160,708 7,778 (93,827) 62,333 $ 62,333 $ $ 74,659 $ 3,573,365 $ (672,230) $ 37,995,

21 CONSOLIDATING STATEMENT OF ACTIVITIES Year Ended December 31, 2014 Myrtle Beach Area Chamber of Commerce Temporarily Unrestricted Restricted Total Increase (Decrease) in Net Assets / Retained Earnings Before Income Taxes $ 2,867,938 $ (2,134,729) $ 733,209 Provision for Income Taxes Increase (Decrease) in Net Assets / Retained Earnings $ 2,867,938 $ (2,134,729) $ 733,209 Net Assets / Retained Earnings - Beginning 2,641,299 4,571,221 7,212,520 Net Assets / Retained Earnings - Ending $ 5,509,237 $ 2,436,492 $ 7,945,

22 Page 3 of 3 Myrtle Beach Consolidating Area Commerce & Eliminating Consolidated Center, Inc. Adjustments Totals $ 527,499 $ (348,150) $ 912,558 (179,349) (179,349) $ 348,150 $ (348,150) $ 733,209 (777,472) 777,472 7,212,520 $ (429,322) $ 429,322 $ 7,945,

23 CONSOLIDATING STATEMENT OF CASH FLOWS Year Ended December 31, 2014 Myrtle Beach Area Chamber Cash Flows From Operating Activities Increase (Decrease) in Net Assets / Retained Earnings $ 733,209 Adjustments to Reconcile Increase (Decrease) in Net Assets / Retained Earnings to Net Cash and Cash Equivalents Provided (Used) by Operating Activities Depreciation 160,708 (Gain) From Investment in Subsidiary (348,150) (Increase) Decrease in Receivables (Net) (77,444) Decrease in Due from Commerce Center 341,186 (Increase) in Due from Chamber (Increase) in Prepaid Expenses (823,103) (Increase) in Inventories (3,325) Decrease in Deferred Tax Asset Increase (Decrease) in Accounts Payable and Accrued Expenses (150,308) (Decrease) in Due to Chamber Increase in Due to Commerce Center 477,484 Increase (Decrease) in Refundable Advances 242,080 Net Cash and Cash Equivalents Provided (Used) by Operating Activities $ 552,337 Cash Flows From Investing Activities Purchases of Certificates of Deposit $ (27,058) Maturities of Certificates of Deposit 26,936 Purchases of Property and Equipment (13,263) Net Cash and Cash Equivalents Used by Investing Activities $ (13,385) Cash Flows From Financing Activities Proceeds from Notes Payable $ 4,000,000 Repayments of Notes Payable (4,000,000) Net Cash and Cash Equivalents Used by Financing Activities $ Net Increase (Decrease) in Cash and Cash Equivalents $ 538,952 Cash and Cash Equivalents - Beginning 7,852,069 Cash and Cash Equivalents - Ending $ 8,391,

24 Myrtle Beach Consolidating Area Commerce & Eliminating Consolidated Center, Inc. Adjustments Totals $ 348,150 $ (348,150) $ 733, , ,150 79,723 3,832 6,111 (341,186) (477,484) (823,103) (3,325) 179, ,349 3,832 (3,832) (150,308) (341,186) 341,186 (45,951) 196, $ (253,567) $ $ 298,770 $ $ $ (27,058) 26,936 (13,263) $ $ $ (13,385) $ $ $ 4,000,000 (4,000,000) $ $ $ $ (253,567) $ $ 285, ,685 8,649,754 $ 544,118 $ $ 8,935,

25 CONSOLIDATED SCHEDULE OF SUPPORT, REVENUES AND EXPENSES - BUDGET AND ACTUAL Year Ended December 31, 2014 Page 1 of 2 Variance Budget Positive Budget Allocation Actual (Negative) Support and Revenues Public Support Local Governments $ 23,133,600 $ $ 22,926,651 $ (206,949) Grants and Promotions 6,142,000 5,657,379 (484,621) Volume Based Member Contributions 1,007,000 1,083,731 76,731 Membership Dues 4,334,500 (2,447,812) 1 2,470, ,153 Advertising Sales 432,000 2,447, ,428, ,322 Member Services 1, (700) Programs and Events 224, ,358 (3,642) Other Revenue 1,540,200 2,145, ,120,866 (564,949) Total Support and Revenues $ 36,814,500 $ 2,145,615 $ 38,908,460 $ (51,655) Expenses Program Expenses Government - Designated Funds $ 136,170 $ $ 57,506 $ 78,664 Advertising and Promotions 26,595,050 2,145, ,703,906 36,759 Publications 1,532, ,440, ,745 Programs and Events 402, ,358 44,842 Member Services 18,780 15,904 2,876 Convention and Group Sales 2,264,688 2,075, ,310 Retail (90) Total Program Expenses $ 30,949,844 $ 2,145,615 $ 32,651,353 $ 444,106 Personnel Expenses Salaries and Wages $ 2,684,559 $ $ 2,689,833 $ (5,274) Contract Labor 7,500 21,358 (13,858) Payroll Taxes 199, ,479 (2,465) Benefits 581, ,188 32,181 Total Personnel Expenses $ 3,472,442 $ $ 3,461,858 $ 10,584 1 The budget as stated does not differentiate between the CVB dues and the advertising portion of the CVB dues. Therefore a budget allocation adjustment is needed to show a more accurate reflection of the budget to actual variances. $2,447,812 is the advertising portion of the CVB dues allocated to the Commerce Center. 2 The budget does not take into account certain private contributions and the related qualifying expenditures incurred in conjunction with other nonprofits in the South Carolina Department of Parks, Recreation and Tourism State Proviso Matching Grant. Accordingly, $2,145,615 in "Other Revenue" and in $2,145,615 "Program" Expenses - Advertising and Promotions, are presented in the Schedule of Support, Revenues and Expenses. Per the budget, these items are presented as net funding

26 CONSOLIDATED SCHEDULE OF SUPPORT, REVENUES AND EXPENSES - BUDGET AND ACTUAL Year Ended December 31, 2014 Page 2 of 2 Variance Budget Positive Budget Allocation Actual (Negative) Expenses (continued) Operating Expenses Supplies and Equipment $ 107,455 $ $ 90,035 $ 17,420 Postage and Freight 784, ,618 (18,923) Telecommunications 92,460 91, Travel and Entertainment 242, ,680 45,935 Dues and Subscriptions 57,985 55,087 2,898 Meetings and Conferences 28,400 15,716 12,684 Training and Development 30,500 19,089 11,411 Professional and Contractual Services 202, ,085 51,240 Other Operating Expenses 74,875 64,983 9,892 Total Operating Expenses $ 1,621,310 $ $ 1,488,183 $ 133,127 Facility Expenses Utilities $ 39,470 $ $ 44,974 $ (5,504) Facility Services 111, ,244 5,426 Lease and Rental Expenses 50,480 46,844 3,636 Insurance 86,400 77,724 8,676 Property Tax and Licenses 50,798 44,063 6,735 Total Facility Expenses $ 338,818 $ $ 319,849 $ 18,969 Other Expenses Depreciation $ 184,000 $ $ 160,708 $ 23,292 Interest Expense 13,000 7,778 5,222 Bad Debt Expense (93,827) 93,827 Total Other Expenses $ 197,000 $ $ 74,659 $ 122,341 Total Expenses $ 36,579,414 $ 2,145,615 $ 37,995,902 $ 729,127 (Decrease) in Net Assets Before Income Taxes $ 235,086 $ $ 912,558 $ 677,