2013-11-07T09:14:41-06:00 2012-12-31 450250958 EIDE BAILLY LLP 4310 17TH AVE S PO BOX 2545 FARGO ND 581082545 990 2012-01-01 410484875 PKM Electric Cooperative PKME 2187454711 PO Box 108 406 North Minnesota Street Warren MN 56762 Charles Riesen 2187454711 2013-10-28 1 LISA CHAFFEE CPA P00193453 7012398500 2013-10-28 2012 2016-03-07 17:11:31Z Charles Riesen PO Box 108 406 North Minnesota Street Warren MN 56762 12951521 0 X www.pkmcoop.com X 1940 MN Sale of electricity to members. 9 9 20 0 5383 4067 0 0 11321294 12760312 156012 124078 -18421 -22625 11458885 12861765 4453 0 0 0 1725688 1727934 0 0 0 9460458 10337089 11190599 12065023 268286 796742 23818117 27356878 11819363 14711410 11998754 12645468 "None" 0 0 Provide electricity service to 3,691 members. 0 0 0 0 0 0 0 1 0 1 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 24 0 1 20 1 1 1 0 0 0 0 13223761 126669 0 X 9 9 0 0 0 0 1 1 1 1 0 0 0 1 1 1 1 1 1 1 0 1 0 X Mike Schmidt 2187454711 406 N Minnesota Street Warren MN 56762 X Ronald Reitmeier 5.00 X X 4375 0 0 John Anderson 5.00 X X 4000 0 0 Gordon Bernstrom 5.00 X X 5500 0 0 Jeffrey Folland 4.00 X 4200 0 0 Thomas Woinarowicz 4.00 X 3750 0 0 Michael Beaudry 4.00 X 4050 0 0 Blake Owens 4.00 X 3900 0 0 Wayne Malm 4.00 X 3900 0 0 Steve Goodwin 4.00 X 3300 0 0 Charles Riesen 40.00 X 128718 0 76861 Mike Schmidt 40.00 X 95897 0 89870 261590 0 166731 1 0 1 0 0 Sale of Electricity 221000 12675955 12675955 Capital Credits 900099 78974 78974 NSS K-1 541900 10639 10639 Federated Acquisitions K-1 541900 -348 -348 Karian K-1 541900 -4908 -4908 12760312 124078 124078 67131 89756 -22625 -22625 12861765 12732304 5383 124078 X 402106 972051 286817 66960 501880 820207 Income taxes 13959 Cost of Power Purchased 8226616 Distribution Expense 1077398 Administrative and Gene 921071 -1224042 12065023 956373 1996094 1336104 2765454 112526 76772 430255 581899 232854 287669 29650621 10175362 18708253 19475259 875241 1000303 1156521 1172060 9990 1368 23818117 27356878 541626 1800507 142556 1307 1307 11113524 12895846 5000 15350 13750 11819363 14711410 X 0 0 18335 18565 11980419 12626903 11998754 12645468 23818117 27356878 X 796742 -150028 X X 0 0 0 0 1 X 134577 134577 820398 518171 302227 27722595 9657191 18065404 973051 973051 19475259 Consumers Deposits 13750 13750 Part IV, Line 2b: The members of the Cooperative can elect to round up their monthly electric bill to the next dollar. These funds collected from the membership are held in a Cooperative account until they are released to PKM Electric Cooperative Trust's Operation Round-up program. These funds are transferred directly to the Operation Round-up on a monthly basis. Funds that exist at the end of year are a result of a timing difference in the receipt of the funds and the release of them to the Operation Round-up. For the year ended December 31, 2012 the account held $1,307. X X X 0 0 0 Charles Riesen 120274 0 0 0 8444 0 56119 0 21861 0 206698 0 0 0 Mike Schmidt 88510 0 0 0 7387 0 62276 0 28526 0 186699 0 0 0 Supplemental Information Part III Form 990, Schedule J, Part II, Column C, Compensation of Officers, Directors, Key Employees, Highest Compensated Employees and Independent Contractors: Included in Column "C", deferred compensaton, is the estimated annual increase in the actuarial value of the defined benefit plan. The estimated increase for Charles Riesen is $37,687 and $51,584 for Mike Schmidt. These amounts are estimates in the increase of the value of the plan and are not current year expenses of the cooperative. The current year expense for this defined benefit plan was $34,270 and $26,735, respectively. Form 990, Part VI, Section A, line 6 There is only one class of members. Any person, firm, corporation or body politic may become a member by: (a) paying the par value for one share of stock; (b) agreeing to purchase electric energy from the Cooperative; (c) agreeing to comply with and be bound by the Articles of Incorporation and Bylaws. Form 990, Part VI, Section A, line 7a Every member has one voting right at the annual meeting to vote on the selection of officers. Form 990, Part VI, Section A, line 7b Each member has one voting right on the approval of changes to the organization documents at the annual meeting. The sale, lease or exchange of all of the Cooperative's property, rights, privileges and franchises must be approved by 2/3 vote of the members. Form 990, Part VI, Section A, line 8b There are no committees that can act on behalf of the governing board. All committees make only recommendations to the governing board, which then makes the final approval. Form 990, Part VI, Section B, line 11 The Assistant Manager, Mike Schmidt, will review the final Form 990. The Form 990 will be provided to the board for review electronically prior to the board meeting. The Assistant Manager will also present the Form 990 to the Manager, Charles Riesen, and the full governing board at a board meeting. Form 990, Part VI, Section B, line 12c The conflict of interest policy, which covers the Board of Directors and officers of the Cooperative, is discussed at a board meeting. The Manager and Assistant Manager review any conflicts that need to be disclosed. If a conflict arises, it is brought to the board's attention and the individual with the conflict abstains from voting on that issue. Form 990, Part VI, Section B, line 15a The board members, who are independent, review and approve the compensation of the Manager by using comparability data only. The approval is recorded in the board minutes. The board members also approve their own adjustments to their compensation based on comparability data only. All other paid employees' compensation is reviewed and approved by the Manager. This process was started in September and approved in October of 2012. Form 990, Part VI, Section C, line 19 The governing documents, conflict of interest policy and financial statements are available to the public upon request. The financial statements are available in the monthly newsletter, and every member is given a copy of the governing documents when they become members. Form 990, Part VII, Section A, Column (F) Included in column "F", estimated amount of other compensation, is the estimated annual increase in the actuarial value of the defined benefit plan. The estimated increase for Charles Riesen is $37,687 and for Mike Schmidt is $51,584. These amounts are estimates in the increase of the value of the plan and are not current year expenses of the cooperative. The current year expense for this defined benefit plan was $34,270 and $26,735, respectively. Form 990, Part IX, Statement of Functional Expenses, Line 24e The labor, pension and payroll taxes reported on lines 5-10 are already included in distribution expense, administrative and general expense and customer expense. Therefore these amounts are being subtracted out as an other deduction on line 24e in the amount of $(1,727,934). Changes in Net Assets or Fund Balances: Form 990, Part XI, line 9: Retirement of Capital Credits -237,396. Less Equity Income From LLC's-Book 180,634. Tax Income From K-1(s) -93,496. Other increase in membership 230. Audited Financials Statements Form 990, Part XI, Line 2b The Organization did not receive audited financial statements for December 31, 2012 year end. The Organization did, however, receive audited financials for the February 28, 2012 year end.