2012-05-15T14:58:05-05:00 2011-06-30 SEIM JOHNSON LLP 18081 BURT STREET SUITE 200 OMAHA NE 680224722 990 2010-07-01 391902797 MANNING REGIONAL HEALTHCARE CENTER MANN 7126552072 410 MAIN STREET MANNING IA 51455 ABBEY STANGL 7126552072 2012-05-15 1 BARBARA J FAJEN 4023302660 2012-05-15 2010 2016-02-24 21:20:13Z ABBEY STANGL 410 MAIN STREET MANNING IA 51455 12465071 0 X WWW.MRHCIA.COM X 1997 IA MANNING REGIONAL HEALTHCARE CENTER (MRHC) IS A LICENSED CRITICAL ACCESS HOSPITAL THAT PROVIDES THE FOLLOWING HEALTHCARE SERVICES FOR THE MANNING, IA AND SURROUNDING COMMUNITIES: ACUTE AND SKILLED CARE, EMERGENCY CARE, OUTPATIENT SPECIALTY CLINICS, NURSING HOME CARE, SURGERY, ANCILLARY SERVICES (I.E. - LABORATORY AND RADIOLOGY), HOME HEALTH CARE, AND SUBSTANCE ABUSE TREATMENT. MRHC HAS 17 LICENSED SWING-BEDS USED FOR ACUTE AND SKILLED CARE, 13 LICENSED, PARTIAL-RESIDENTIAL, SUBSTANCE ABUSE TREATMENT BEDS (UNDER THE MANNING FAMILY RECOVERY CENTER - A DISTINCT PART UNIT), AND 56 LICENSED LONG-TERM CARE BEDS (UNDER THE MANNING PLAZA). ALL THE MRHC ACTIVITIES ARE PROVIDED BY LICENSED PROFESSIONALS AS REQUIRED BY THE REGULATIONS GOVERNING A HOSPITAL AND NURSING HOME. 7 7 195 100 0 -4893 60956 340552 10520740 12032139 44361 27000 11475 63014 10637532 12462705 0 0 0 0 5307275 6108052 0 0 0 4698590 5339065 10005865 11447117 631667 1015588 10290779 11296522 3153808 3171595 7136971 8124927 X MANNING REGIONAL HEALTHCARE CENTER (MRHC) WILL PROVIDE A COMPASSIONATE, HOLISTIC HEALTH CARE EXPERIENCE THE COMMUNITY CAN TRUST. 1 0 4978572 6662414 THE MANNING GENERAL HOSPITAL IS A 17-BED FACILITY FEDERALLY DESIGNATED AS A CRITICAL ACCESS HOSPITAL. HOSPITAL SERVICES INCLUDE ACUTE AND SKILLED CARE, EMERGENCY CARE, OUTPATIENT SPECIALTY CLINICS, SURGERY, AND ANCILLARY (I.E. - LABORATORY AND RADIOLOGY) SERVICES. 3031959 2717886 THE MANNING PLAZA (THE PLAZA) PROVIDES INTERMEDIATE CARE TO THE ELDERLY. THE PLAZA IS A 56-BED LONG-TERM CARE FACILITY OFFERING 24-HOUR NURSING CARE AND SPECIALIZED DIETARY SERVICE. IT ALSO OFFERS RECREATIONAL PROGRAMS, REHABILITATIVE SERVICES AND SOCIAL SERVICES. 1140000 1913580 THE MANNING FAMILY RECOVERY CENTER (MFRC) PROVIDES SAFE, EFFICIENT, AND EFFECTIVE CHEMICAL DEPENDENCY TREATMENT TO DHEMICALLY DEPENDENT INDIVIDUALS AND THEIR FAMILIES ACROSS IOWA AND NEBRASKA. SERVICES INCLUDE DETOX, RESIDENTIAL, AND OUTPATIENT CHEMICAL DEPENDENCY TREATMENT, CO-DEPENDENCY TREATMENT, AFTERCARE, OUTREACH SERVICES, EMPLOYEE ASSISTANCE PROGRAMMING, AND OWI EVALUATION/EDUCATION. THE MFRC IS A 13-BED CO-ED MULTI-LEVEL TREATMENT CENTER. 941360 738259 OTHER MISCELLANEOUS PROGRAM SERVICES 941360 738259 10091891 1 1 0 1 0 0 0 0 0 1 0 0 0 1 1 1 0 0 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 246 0 195 1 0 0 0 0 0 0 0 0 0 0 X 7 7 0 1 0 0 0 0 0 1 1 0 0 1 1 1 1 1 1 1 1 0 IA X ABBEY STANGL 7126558123 410 MAIN STREET MANNING IA 51455 RANDY BEHRENS 1.00 X X 0 0 0 SHARON KELDERMAN 0.50 X X 0 0 0 VIRGINIA RASMUSSEN 0.50 X X 0 0 0 LARRY HAGEDORN 0.50 X 0 0 0 SHERRY HUEHN 0.50 X 0 0 0 RUTH OHDE 0.50 X 0 0 0 BRET RICHARDS 0.50 X 0 0 0 ANGELA JOHNSON 40.00 X 0 0 0 ABBEY STANGL 40.00 X 81397 0 13932 AMY DAWSON 40.00 X 65961 0 15040 147358 0 28972 0 0 0 0 WAPITI MEDICAL GROUP PO BOX 92 NEWELL SD 57760 ER PHYSICIAN STAFFING 185005 ST ANTHONY REGIONAL HOSPITAL 311 S CLARK STREET CARROLL IA 51401 CONTRACT PHYSICAL THERAPY 174110 MERCY MEDICAL CENTER 1111 6TH AVENUE DES MOINES IA 50314 MANAGEMENT SERVICES 136478 LOCALE ANESTHESIA PC 5137 PANORAMA DRIVE PANORA IA 50216 CRNA SERVICES 134670 4 19421 321131 340552 PATIENT REVENUE 624100 7400885 7400885 MEDICARE PAYMENTS 624100 3215864 3215864 MEDICAID PAYMENTS 624100 1382658 1382658 IMMUNIZATION CLINIC RE 624100 17500 17500 15232 15232 12032139 27660 27660 21686 1706 19980 19980 19980 660 -660 -660 -660 CAFETERIA REVENUE 624100 43034 43034 43034 12462705 12032139 0 90014 176330 176330 4869534 4485235 384299 84212 76650 7562 608924 608924 369052 333403 35649 72516 72516 92812 92812 1488273 1286122 202151 83176 83176 1937650 1771104 166546 265057 235901 29156 49360 30173 19187 3139 3139 514640 458030 56610 166410 159210 7200 BAD DEBT EXPENSE 295091 295091 MISCELLANEOUS EXPENSES 161901 139160 22741 DUES & SUBSCRIPTIONS 139597 65071 74526 EDUCATION & TRAINING 69443 61502 7941 11447117 10091891 1355226 0 -55925 44570 4648037 5004634 1028056 1347292 34533 70987 203223 225026 63049 56231 10907933 6834408 3960259 4073525 249226 241639 66844 68471 93477 164147 10290779 11296522 1047116 995984 1565000 1405000 541692 770611 3153808 3171595 X 7095330 7788059 41641 336868 7136971 8124927 10290779 11296522 X 1015588 -27632 X X 0 1 1 X 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 0 0 0 0 0 0 0 1 2494 2494 0 EXPLANATION OF OTHER LOBBYING ACTIVITIES: PART II-B, LINE 1I: MANNING REGIONAL HEALTHCARE CENTER (MRHC) PAYS ASSOCIATION DUES TO THE IOWA HOSPITAL ASSOCIATION (IHA). PORTIONS OF ASSOCIATION DUES ARE EXPENDED BY THE ASSOCIATION FOR LOBBYING PURPOSES. IN FY 2011, MRHC PAID IHA DUES OF $11,655, OF WHICH 21.4% WAS ESTIMATED TO BE NON-DEDUCTIBLE EXPENSE (BY IHA) FOR LOBBYING ACTIVITIES. 428518 428518 547341 5798131 4084177 2261295 96262 3207471 1970622 1333111 7309 822901 779609 50601 4073525 CAPITAL LEASE OBLIGATIONS 94565 DUE TO FISCAL INTERMEDIARY 676046 770611 12462705 11447117 1015588 -27632 -27632 987956 12435073 -27632 -27632 12462705 0 12462705 11447117 0 11447117 0 11447117 DESCRIPTION OF UNCERTAIN TAX POSITIONS UNDER FIN 48: PART X: THE HEALTHCARE CENTER IS A NOT-FOR-PROFIT CORPORATION AS DESCRIBED IN SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE AND IS EXEMPT FROM FEDERAL INCOME TAXES ON RELATED INCOME PURSUANT TO SECTION 501(A) OF THE CODE. THE INTERNAL REVENUE SERVICE HAS ESTABLISHED STANDARDS TO BE MET TO MAINTAIN THE HEALTHCARE CENTER'S TAX EXEMPT STATUS. IN GENERAL, SUCH STANDARDS REQUIRE THAT THE HEALTHCARE CENTER MEET A COMMUNITY BENEFITS STANDARD AND COMPLY WITH VARIOUS LAWS AND REGULATIONS. THE HEALTHCARE CENTER ACCOUNTS FOR UNCERTAINTIES IN ACCOUNTING FOR INCOME TAX ASSETS AND LIABILITIES USING GUIDANCE INCLUDED IN FASB ASC 740, INCOME TAXES. THE HEALTHCARE CENTER RECOGNIZES THE EFFECT OF INCOME TAX POSITIONS ONLY IF THOSE POSITIONS ARE MORE LIKELY THAN NOT OF BEING SUSTAINED. AT JUNE 30, 2011 AND 2010, THE HEALTHCARE CENTER HAD NO UNCERTAIN TAX POSITIONS ACCRUED. 1 1 1 X 1 X 190.000000000000 1 1 0 1 1 1 9 20447 0 20447 0.00180 6204 0 6204 0.00060 1 9 26651 26651 0.00240 8 438 2704 309 2395 0.00020 1 138 1254 0 1254 0.00010 10566 0 10566 0.00090 9 576 14524 309 14215 0.00120 10 585 41175 309 40866 0.00360 1 202468 0 3322266 3289372 32894 X 1 1 1 1 MANNING REGIONAL HEALTHCARE CENTER

410 MAIN STREET MANNING IA 51455

X X X X OUTPATIENT PHYSICIAN CLINIC, SKILLED NURSING FACILITY, CHEM DEP REHAB CENTER NA 1 1 MANNING REGIONAL HEALTHCARE CLINIC

321 CENTER STREET MANNING IA 51455

HEALTHCARE CLINIC PART I, LINE 3C: FEDERAL POVERTY GUIDELINES ARE USED TO DETERMINE ELIGIBILITY FOR PROVIDING FREE AND DISCOUNTED CARE TO LOW INCOME INDIVIDUALS. PART I, LINE 7: THE PATIENT CARE COST TO CHARGE RATIO WAS USED TO DETERMINE CHARITY CARE AT COST. OTHER COMMUNITY BENEFIT EXPENSES ARE STATED AT COST AS DERIVED FROM MANNING REGIONAL HEALTHCARE CENTER'S INTERNAL ACCOUNTING RECORDS. PART I, LINE 7G: THERE ARE NO SUBSIDIZED HEALTH SERVICES. PART I, L7 COL(F): BAD DEBT EXPENSE AT COST IS COMPUTED BY MUTIPLYING BAD DEBT EXPENSE, $295,091, BY THE PATIENT CARE COST TO CHARGE RATIO. PART II: THE ORGANIZATION CURRENTLY DOES NOT ENGAGE IN COMMUNITY BUILDING ACTIVITIES. PART III, LINE 4: THE ORGANIZATION'S FINANCIAL STATEMENTS DO NOT CONTAIN A SPECIFIC FOOTNOTE DESCRIBING BAD DEBT. HOWEVER, THE FOLLOWING IS THE TEXT OF THE FOOTNOTES TITLED "PATIENT ACCOUNTS RECEIVABLE" AND "CHARITY CARE":PAYMENT FOR SERVICES IS EXPECTED WITHIN THIRTY DAYS OF RECEIPT OF THE BILLING. ACCOUNTS CONSIDERED PAST DUE ARE SENT TO COLLECTION AGENCIES WHEN INTERNAL COLLECTION EFFORTS HAVE BEEN UNSUCCESSFUL. ANY AMOUNTS DEEMED UNCOLLECTIBLE ARE WRITTEN OFF ON A MONTHLY BASIS. THE HEALTHCARE CENTER DOES NOT CHARGE INTEREST ON OUTSTANDING BALANCES OWED.THE HEALTHCARE CENTER ALSO MAINTAINS A CHARITY CARE POLICY.THE HEALTHCARE CENTER PROVIDES CARE TO PATIENTS WHO MEET CERTAIN CRITERIA UNDER ITS CHARITY CARE POLICY WITHOUT CHARGE OR AT AMOUNTS LESS THAN ITS ESTABLISHED RATES. BECAUSE THE HEALTHCARE CENTER DOES NOT PURSUE COLLECTION OF THESE AMOUNTS DETERMINED TO QUALIFY AS CHARITY CARE, THEY ARE NOT REPORTED IN THE STATEMENTS OF OPERATIONS. CHARGES EXCLUDED FROM REVENUE UNDER THE HEALTHCARE CENTER'S CHARITY CARE POLICY WERE $29,763 AND $23,402 FOR 2011 AND 2010, RESPECTIVELY.THE OVERALL COST-TO-CHARGE RATIO WAS USED TO ESTIMATE BAD DEBT AT COST.PART III, SECTION A, LINE 2 WAS CALCULATED AS FOLLOWS:[(OPERATING EXPENSES - BAD DEBT - TOTAL COMMUNITY BENEFIT EXPENSES) / (GROSS PATIENT SERVICE REVENUE + OTHER REVENUE)] X BAD DEBT.[(11,447,117 - 295,091 - 14,524) / 16,157,473 + 75,106] X 295,091 = 202,468 PART III, LINE 8: "MEDICARE ALLOWABLE COSTS OF CARE" WAS CALCULATED FROM INFORMATION IN THE MEDICARE COST REPORT, D, E, H AND M WORKSHEETS, OR PS&R. PART III, LINE 9B: PART 1 OF THE PATIENT FINANCIAL ASSISTANCE POLICY "GUIDELINES" SECTION PROVIDES THAT ONCE THE RESPONSIBLE PARTY HAS BEEN DETERMINED TO BE ELIGIBLE FOR PATIENT FINANCIAL ASSISTANCE, A BILL WILL NOT BE SENT TO THE REPSONSIBLE PARTY. PART VI, LINE 2: MANNING REGIONAL HEALTH CENTER INCLUDES INPUT AND INFORMATION FROM REPRESENTATIVES OF THE MEDICAL STAFF, BOARD COMMITTEE, AND HOSPITAL ADMINISTRATIVE STAFF TO REVIEW THE TREATMENT OF PATIENTS TO DETERMINE MEDICAL NECESSITY AND OTHER CRITERIA ARE MET IN ORDER TO PROMOTE MAXIMUM TREATMENT BENEFITS. THIS GROUP OVERSEES THE QUALITY OF PATIENT CARE, ASSURING RESOURCES ARE USED APPROPRIATELY TO PROMOTE OPTIMAL PATIENT CARE.MANNING REGIONAL HEALTH CENTER ALSO PARTICIPATED IN AND SET GOALS BASED ON A HEALTH NEEDS ASSESSMENT PERFORMED BY CARROLL COUNTY, IOWA. PART VI, LINE 3: PATIENTS ARE MADE AWARE THROUGH A FINANCIAL ASSISTANCE INFORMATION PACKET, USUALLY OBTAINED AT ADMISSION. THOSE WITHOUT INSURANCE ARE PROVIDED THE INFORMATION PACKET AT ADMISSION, AND THE PACKET IS PROVIDED AS PART OF THE DISCHARGE PROCESS FOR ER SERVICES. ADDITIONALLY, MANNING REGIONAL HEALTH CARE CENTER HAS CONTRACTED WITH A THIRD-PARTY VENDOR FOR BILLINGS AND COLLECTIONS. THE VENDOR CONTACTS FORMER PATIENTS BY TELEPHONE DURING THE 2ND 30 DAYS THAT AN INVOICE IS PAST DUE. PATIENTS ARE SCREENED FOR FINANCIAL ASSISTANCE NEEDS WITH THAT TELEPHONE CALL.THE FINANCIAL ASSISTANCE INFORMATION PACKET, INCLUDING THE APPLICATION, ARE ALSO AVAILABLE ON THE HEALTH CENTER'S WEBSITE. PART VI, LINE 4: CITIES OF MANNING (POPULATION 1500), TEMPLETON (POPULATION 350, AND MANILLA (POPULATION 900) ALONG WITH OTHER SURROUNDING RURAL COMMUNITIES IN WEST CENTRAL IOWA. MANNING, IOWA IS 90 MILES NORTHWEST OF DES MOINES, 80 MILES NORTHEAST OF OMAHA, AND 80 MILES SOUTHEAST OF SIOUX CITY. PART VI, LINE 6: MANNING GENERAL HOSPITAL PROVIDES OUTPATIENT CLINICS IN WHICH SPECIALTY DOCTORS COME TO MANNING ON A REGULAR BASIS. THE HOSPITAL ALSO SPONSORS FREE EDUCATIONAL SEMINARS ON VARIOUS HEALTH TOPICS TO THE COMMUNITY. THE MANNING FAMILY RECOVERY CENTER PROVIDES ALCOHOLICS ANONYMOUS, AL-ANON, AND NARCOTICS ANONYMOUS MEETINGS. THE CENTER ALSO PROVIDES A FREE, OPEN TO THE PUBLIC, EDUCATION PROGRAM THAT EXPLORES CHEMICAL DEPENDENCY AND ITS EFFECTS. PART VI, LINE 7: NOT APPLICABLE REPORTS FILED WITH STATES PART VI, LINE 7 IA NEW PROGRAM SERVICES FORM 990, PART III, LINE 2 AS OF DECEMBER 1, 2010, MANNING REGIONAL HEALTHCARE CENTER (MRHC) PURCHASED THE MANNING FAMILY HEALTHCARE CLINIC, P.C., AN INDEPENDENTLY-OWNED FAMILY PRACTICE PHYSICIAN'S CLINIC LOCATED IN MANNING, IOWA. MRHC HAS CONTINUED TO OPERATE THE FAMILY PRACTICE CLINIC WITH THE SAME METHODOLOGY, USING THE SAME STAFFING MATRIX. THE CLINIC PROVIDES FAMILY CARE SERVICES TO THE CITIZENS OF MANNING AND SURROUNDING COMMUNITIES. FORM 990, PART VI, SECTION A, LINE 3 MANAGED CONTRACT AFFILIATION AGREEMENT WITH MERCY HOSPITAL MEDICAL CENTER OF DES MOINES, IOWA - THE ADMINISTRATOR OF MANNING REGIONAL HEALTHCARE CENTER (MRHC) IS AN EMPLOYEE OF MERCY BUT REPORTS TO THE MRHC BOARD OF DIRECTORS. FORM 990, PART VI, SECTION B, LINE 11 THE FINANCIAL STATEMENT PREPARATION AND RECORDING PROCESSES OF MRHC ARE THE PRIMARY RESPONSIBILITIES OF ABBEY STANGL, CFO. UPON THE ISSUANCE OF THE FORM 990 ORGANIZER FROM THE TAX RETURN PREPARER, SEIM JOHNSON, THE CFO BEGINS TO PREPARE DOCUMENTATION FOR THE FORM 990. UPON THE SUBMISSION OF THE FORM 990 ORGANIZER TO THE PREPARER, ANY QUESTIONS ARE CLARIFIED AND ANSWERED. PRIMARY REVIEWING RESPONSIBILITY OF THE FORM 990 LIES WITH THE CFO, THE CEO, AND THE FINANCE SUB-COMMITTEE OF THE BOARD OF DIRECTORS, WHICH ENABLES BOARD REVIEW DURING INTERIM BOARD MEETING PERIODS. IT IS ALWAYS THE INTENT TO HAVE THE FORM 990 PREPARED AND REVIEWED PRIOR TO INITIAL FILING DEADLINES, BUT IF FOR ANY REASON, THIS CANNOT BE ACHIEVED, APPROPRIATE FILINGS TO EXTEND THE FILING DEADLINE ARE FILED. EACH MEMBER OF THE BOARD OF DIRECTORS IS GIVEN A COPY OF THE FORM 990 TO REVIEW BEFORE FILING IS COMPLETED. FORM 990, PART VI, SECTION B, LINE 12C THROUGHOUT THE YEAR, ANY ISSUE THAT INVOLVES A CONFLICT OF INTEREST WITH A TRUSTEE, DIRECTOR, OFFICER, OR KEY EMPLOYEE WOULD REQUIRE THAT THE INDIVIDUAL BE SEPARATED FROM THE DECISION-MAKING PROCESS RELATED TO THE POTENTIAL CONFLICT OF INTEREST. IN REGARD TO ANNUAL COMPLIANCE, THE REFERENCE TO THE CONFLICT OF INTEREST POLICY OUTLINES CURRENT PRACTICES. EACH DIRECTOR, PRINCIPAL OFFICER AND MEMBER OF A COMMITTEE WITH GOVERNING BOARD DELEGATED POWERS SHALL ANNUALLY SIGN A STATEMENT WHICH AFFIRMS SUCH PERSON: HAS RECEIVED A COPY OF THE CONFLICTS OF INTEREST POLICY, HAS READ AND UNDERSTANDS THE POLICY, HAS AGREED TO COMPLY WITH THE POLICY, AND UNDERSTANDS THE ORGANIZATION IS CHARITABLE AND IN ORDER TO MAINTAIN ITS FEDERAL TAX EXEMPTION IT MUST ENGAGE PRIMARILY IN ACTIVITIES WHICH ACCOMPLISH ONE OR MORE OF ITS TAX-EXEMPT PURPOSES. FULFILLMENT OF THIS OBJECTIVE WILL FALL UNDER THE MRHC ADMINISTRATIVE POLICY REVIEW PROCESS. FORM 990, PART VI, SECTION B, LINE 15 MRHC DETERMINES COMPENSATION FOR ITS OFFICERS AND KEY EMPLOYEES BY CONSULTING THE CURRENT IOWA HOSPITAL ASSOCIATION (IHA) SALARY SURVEY. THIS SURVEY IS DONE ANNUALLY WITH THE HOPE OF GETTING 100% PARTICIPATION OF ALL IOWA HOSPITALS. MRHC USES THE INFORMATION FROM ITS PEER GROUP AS COMPARATIVE DATA FOR DETERMINING WAGES. THE PEER GROUP IS SELECTED BY MRHC AND CONSISTS OF HOSPITALS IN THE VICINITY OF MRHC AND HOSPITALS THAT ARE APPROXIMATELY THE SAME SIZE AS MRHC. MRHC WILL ALSO FACTOR IN YEARS OF EXPERIENCE WHEN DETERMINING WAGES FOR NEWLY HIRED EMPLOYEES OR WHETHER OR NOT MARKET INCREASES ARE NEEDED FOR EXISTING KEY EMPLOYEES OR OFFICERS. FOR THE CEO POSITION SPECIFICALLY, AS THAT POSITION IS MANAGED THROUGH MERCY HOSPITAL MEDICAL CENTER OF DES MOINES, IA, THE SALARY AND COMPENSATION IS DETERMINED BY THE MERCY NETWORK VICE PRESIDENT, IN CONJUNCTION WITH THE MRHC BOARD OF DIRECTORS. TO DETERMINE THE SALARY, THE IHA SALARY SURVEY IS FIRST REVIEWED, WHICH RECOGNIZES SALARY RANGES BASED ON HOSPITAL REVENUES, NUMBER OF FTE'S AND ALSO BASED ON CAH. A CHICAGO-BASED COMPANY, HR ADVANTAGE, IS ALSO USED IN A SURVEY COMPILING COMMUNITY DEMOGRAPHICS. FORM 990, PART VI, SECTION C, LINE 19 MRHC PROVIDES INFORMATION REGARDING THESE DOCUMENTS TO INDIVIDUALS AND BUSINESSES UPON REQUEST. CHANGES IN NET ASSETS OR FUND BALANCES: FORM 990, PART XI, LINE 5: NET UNREALIZED LOSSES ON INVESTMENTS: -27,632. FORM 990, PART XI, LINE 2C THERE HAVE BEEN NO CHANGES FROM THE PRIOR YEAR. THE BOARD OF DIRECTORS TAKES RESPONSIBILITY FOR THE OVERSIGHT OF THE AUDIT OF ITS FINANCIAL STATEMENTS AND SELECTION OF AN INDEPENDENT ACCOUNTANT.