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//-13i <br /> ORONO SENIOR HOUSING, LLC <br /> SUMMARY OF SIGNIFICANT ASSUMPTIONS AND ACCOUNTING <br /> POLICIES <br /> DECEMBER 31, 2001, 2002, 2003, 2004, 2005 AND 2006 <br /> (1) NATURE OF FORECASTS <br /> These forecasts present, to the best of knowledge and belief of management and its <br /> manager, the Orono Senior Housing, LLC's (the Organization) expected financial <br /> position, activities and cash flows as of December 31, 2001, 2002, 2003, 2004, <br /> 2005 and 2006 and for period from November 1, 2001 (inception) through <br /> December 31, 2001 and the years ending December 31, 2002, 2003, 2004, 2005 <br /> and 2006. Accordingly, the forecasts reflect its judgment as of October 25, 2001, <br /> the date of these forecasts, of the expected conditions, and its expected course of <br /> action. <br /> The assumptions disclosed herein are those that management believes are <br /> significant to the forecasts. However, there will usually be differences between <br /> projected and actual results, because events and circumstances frequently do not <br /> occur as expected, and those differences may be material. Management has no <br /> responsibility to update this report for events and circumstances occurring after the <br /> date of this report. <br /> (2) NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT <br /> ACCOUNTING POLICIES <br /> The accounting policies used for the forecasted financial statements are the policies <br /> expected to be used in preparing historical financial statements. <br /> Organization - Orono Senior Housing, LLC is a limited liability company <br /> organized in accordance with the laws of the State of Minnesota, the sole member <br /> of which is the Wedum Foundation, a Minnesota non-profit corporation and a tax <br /> exempt organization under Section 501(c)(3) of the Internal Revenue Code. <br /> Tax status - The Organization is currently treated as a tax-exempt organization <br /> under Section 501(c)(3) of the Internal Revenue Code and a similar section of <br /> Minnesota state statutes and, accordingly, is not subject to income taxes on <br /> operating income. While the Organization is generally exempt from income taxes, <br /> it is subject to taxes on unrelated trade or business income and on excess lobbying <br /> expenses. For the forecasted period the Organization has not forecasted any <br /> unrelated trade or business income or excess lobbying expenses. <br /> Financial statement presentation - The financial statements are presented in <br /> accordance with Statement of Financial Accounting Standards No. 117, "Financial <br /> Statements of Not-for-Profit Organizations," which requires the Organization to <br /> report information regarding its financial position and activities according to three <br /> classes of net assets: unrestricted, temporarily restricted and permanently <br /> restricted. <br /> Unrestricted net assets include net assets not subject to donor-imposed stipulations <br /> and are available for general purposes. Temporarily restricted net assets include <br /> net assets subject to donor-imposed stipulations that will be met by action of the <br /> Organization and/or the passage of time. Permanently restricted net assets are <br />