MeadowWood Homeowners Association

MeadowWood Homeowners Association

Financial Statements and Independent Auditors' Report

December 31, 2016 and 2015

MeadowWood Homeowners Association

December 31, 2016 and 2015

Table of Contents

Page INDEPENDENT AUDITORS' REPORT .......................................................................................................... 2-3

FINANCIAL STATEMENTS: Statements of cash receipts and disbursements .................................................................................................. 4-5 Notes to financial statements .............................................................................................................................. 6-9 Note 1 ? Nature of organization Note 2 ? Summary of significant accounting policies Note 3 ? Income taxes Note 4 ? Future major repairs and replacements Note 5 ? Concentration of credit risk Note 6 ? Commitments

SUPPLEMENTARY INFORMATION: INDEPENDENT AUDITORS' REPORT ON SUPPLEMENTARY INFORMATION ..................................................................................................... 10 Information on future major repairs and replacements ............................................................................... 11

INDEPENDENT AUDITORS' REPORT

Board of Directors MeadowWood Homeowners Association Liberty Lake, Washington

We have audited the accompanying statements of cash receipts and disbursements of MeadowWood Homeowners Association (a Washington corporation) (the Association) for the years ended December 31, 2016 and 2015, and the related notes to the 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 the cash basis of accounting described in Note 2; this includes determining that the cash basis of accounting is an acceptable basis for the preparation of these financial statements in the circumstances. Management is also responsible for 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.

Auditor's 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 audit 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 statement. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statement, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Association'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 Association'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.

2

Opinion In our opinion, the financial statements referred to in the first paragraph present fairly, in all material respects, the cash receipts and disbursements of MeadowWood Homeowners Association for the years ended December 31, 2016 and 2015, in accordance with the cash basis of accounting described in Note 2. Basis of Accounting We draw attention to Note 2 of the financial statements, which describes the basis of accounting. These financial statements are prepared on the cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to that matter. Spokane, Washington January 10, 2018

3

MeadowWood Homeowners Association

Statement of Cash Receipts and Disbursements

Year Ended December 31, 2016

Operating Fund Savings Fund Reserve Fund

Total

CASH RECEIPTS: Members' assessments: Operating dues, gross Other

CASH DISBURSEMENTS: Accounting fees Insurance Landscaping Legal fees Maintenance Marketing Office Other administrative expenses Other expenses Property management fee Streets Payroll Real estate taxes and licenses Utilities

MAJOR REPAIRS AND REPLACEMENTS

$ 363,275 11,706

374,981

9,972 7,997 157,475 2,060 14,940

845 8,599 9,235

125 82,402

3,714 2,347 1,325 71,454 372,490

4,243

$

-

81

81

$

-

$ 363,275

1

11,788

1

375,063

-

-

9,972

-

-

7,997

-

-

157,475

-

-

2,060

-

-

14,940

-

-

845

-

-

8,599

-

-

9,235

-

-

125

-

-

82,402

-

-

3,714

-

-

2,347

-

-

1,325

-

-

71,454

-

-

372,490

-

-

4,243

INCREASE (DECREASE) IN CASH

NET TRANSFERS BETWEEN FUNDS

BEGINNING CASH

(1,752)

(12,307) 39,364

81

12,307 64,611

1

1,181

(1,670)

105,156

ENDING CASH

$ 25,305

$ 76,999

$ 1,182

$ 103,486

See accompanying notes to financial statements. 4

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