77 BRONX RIVER ROAD OWNERS, INC FINANCIAL STATEMENTS ... · PAMELA E KAPLAN CPA, PC. 77 BRONX RIVER ROAD OWNERS, INC Page Accountant's Report 1-2 ... presentation of the financial

77 BRONX RIVER ROAD OWNERS, INC

FINANCIAL STATEMENTS

DECEMBER 31, 2015

PAMELA E KAPLAN CPA, PC


Page

Accountant's Report 1 - 2

Comparative Balance SheetDecember 31, 2015 and 2014 3 - 4

Statement of Additional Paid-in CapitalDecember 31, 2015 5

Comparative Statement of Retained Earnings (Deficit)For the Years Ended December 31, 2015 and 2014 6

Comparative Statement of Revenues and ExpensesFor the Years Ended December 31, 2015 and 2014 7

Comparative Schedule of Supplies, Repairsand MaintenanceFor the Years Ended December 31, 2015 and 2014 8

Comparative Statement of Cash FlowsFor the Years Ended December 31, 2015 and 2014 9

Notes to Financial StatementsDecember 31, 2015 and 2014 10 - 13

PAMELA E KAPLAN CPA, PC

PAMELA E KAPLAN CPA, PCCERTIFIED PUBLIC ACCOUNTANT

POST OFFICE BOX 417155 GARTH ROAD, SUITE A

SCARSDALE, NEW YORK 10583

(914)723-6414FAX (914) 723-8487

To the Stockholders77 Bronx River Road Owners, IncYonkers, New York 10704

I have audited the accompanying financial statements of 77 BronxRiver Road Owners, Inc, which comprise the balance sheet as ofDecember 31, 2015 and the related statements of additionalpaid-in capital, retained earnings (deficit), revenues andexpenses and cash flows for the year then ended and the relatednotes to the financial statements.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fairpresentation of these financial statements in accordance withU.S. generally accepted accounting principles; this includes thedesign, implementation and maintenance of internal controlrelevant to the preparation and fair presentation of financialstatements that are free from material misstatement whether dueto fraud or error.

Auditor's Responsibility

My responsibility is to express an opinion on these financialstatements based on my audit. I conducted my audit in accordancewith U.S. generally accepted auditing standards. Those standardsrequire that I plan and perform the audit to obtain reasonableassurance about whether the financial statements are free frommaterial misstatement.

An audit involves performing procedures to obtain audit evidenceabout the amounts and disclosures in the financial statements.The procedures selected depend on the auditor's judgment,including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. Inmaking those risk assessments the auditor considers internalcontrol relevant to the entity's preparation and fairpresentation of the financial statements in order to design auditprocedures that are appropriate in the circumstances, but not forthe purpose of expressing an opinion on the effectiveness of theentity's internal control. Accordingly, I express no suchopinion. An audit also includes evaluating the appropriatenessof accounting policies used and the reasonableness of significantaccounting estimates made by management as well as evaluating theoverall presentation of the financial statements.

To the Stockholders77 Bronx River Road Owners, Inc

Auditor's Responsibility (Continued)

I believe that the audit evidence I have obtained is sufficientand appropriate to provide a basis for my audit opinion.

Opinion

In my opinion the financial statements referred to above presentfairly in all material respects the financial position of 77Bronx River Road Owners, Inc as of December 31, 2015 and 2014 andthe results of its operations and its cash flows for the yearsthen ended in accordance with accounting principles generallyaccepted in the United States of America.

Scarsdale, New YorkFebruary 16, 2016


COMPARATIVE BALANCE SHEET

DECEMBER 31, 2015 AND 2014

ASSETS

Current AssetsCash - checking account $ 31,357 $ 26,361Cash - reserve accounts 103 . 190 137,516

Total Cash 134,547 163,877Proprietary rents receivable 11,188 5,626Escrow - real estate tax 10,699 10,905Prepaid insurance 9,197 6,076Prepaid New York State corporation

tax - 188

Total Current Assets 165, 631 186, 672

PropertyLand 16,100 16,100Building 385,743 385,743Building improvements 1,633,646 1,613,446Equipment 31,137 29, 124

2,066,626 2,044,413Less: Accumulated depreciation 819,233 758, 809

Total Property 1 ,247, 393 1 , 285, 604

Other AssetsNCB stock 7,776 7,776Mortgage and equity line of credit

refinancing costs 57,100 64,548

Total Other Assets 64,876 72 , 324

Total Assets $ 1 . 477.900 $ 1 . 544 . 600

The accompanying letter and notes are an integral part of thesefinancial statements.

- 3 -PAMELA E KAPLAN CPA, PC


COMPARATIVE BALANCE SHEET


LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT

CurrentAccounts payable and accrued

expenses $ 28,615 $ 42,794STAR abatements payable 39,745 32,983New York State corporation tax

payable 841Prepaid proprietary rents 5,229 4,964Mortgage payable - current portion 17,873 17,298

Total Current Liabilities 92,303 98 , 039

Other LiabilitiesMortgage payable - non-currentportion 2, 004,277 2 , 022 , 150

Total Other Liabilities 2,004,277 2 . 022 , 150

Total Liabilities 2 , 096,580 2 , 120, 189

Stockholders' Equity (Deficit)Capital stock, $ .01 par value;

authorized 20,000 shares; issuedand outstanding 16,470 shares 165 165

Additional paid-in capital 499,896 482,598Retained earnings (deficit) (1,118,741) (1,058,352

Total Stockholders' Equity(Deficit) ( 618, 680 ) ( 575, 589

Total Liabilities andStockholders' Equity(Deficit) $ 1.477,900 $ 1f544,600




STATEMENT OF ADDITIONAL PAID-IN CAPITAL

DECEMBER 31, 2015

Excess of initial tenant-owners'aggregate capital stock purchase priceover the par value thereon $ 25,000

Proceeds in excess of par value fromsale of shares of repossessed unit 21,000

Proceeds from retaining wall claimsettlement 50,000

Capital improvements special assessment2011 $ 20,8352010 50,0032009 50,0032008 50,0032007 33,335 204,179

Portion of proprietary rents applicableto mortgage and equity line of creditindebtedness amortization

2015 $ 17,2982014 16,4862013 11,7212012 10,7992011 10,3832010 11,4562009 9,3562008 8,7432007 8,4372006 8,0092005 7,6022004 13,9062003 14,4782002 13,6592001 12,8852000 12,0591999 11,4721998 968 199 . 717

Additional Paid-in Capital


- 5PAMELA E KAPLAN CPA, PC


COMPARATIVE STATEMENT OF RETAINED EARNINGS (DEFICIT)

FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

Retained Earnings (Deficit) -Beginning of Year $ ( 1 . 058, 352 ) $ ( 991,914)

Excess of revenues over expenses(expenses over revenues) beforedepreciation and amortization 7,483 ( 754)

Provision for depreciation ( 60,424) ( 58,236)

Provision for amortization ofmortgage and equity line ofcredit refinancing costs ( 7,448) ( 7,448)

Excess of (expenses over revenues) ( 60,389) ( 66,438)

Retained Earnings (Deficit) - Endof Year $ (I. 118.7411 $ (1.058.3521




COMPARATIVE STATEMENT OF REVENUES AND EXPENSES


RevenuesProprietary rents $ 472,725 $ 462,753Parking revenues 21,097 18,200Transfer fees 3,500 7,000Laundry, sublet fees, late charges

and miscellaneous income 18,336 17,775Dividend income 937Portion of proprietary rents appli-

cable to amortization of mortgage ( 17,298) ( 16.486

Total Revenues 499,297 489 . 242

Fixed Charges and Operating ExpensesFixed Charges

Real estate taxes 108,832 105,367Mortgage interest 97,767 98,582Insurance 46,591 46,463Corporation income taxes 1,029 1.038

Total Fixed Charges 254 ,219 251,450

Operating ExpensesSalaries, payroll taxes and

employee benefits 80,411 80,126Fuel 34,064 39,293Utilities 11,735 12,988Water and sewer 14,119 15,770Supplies, repairs and maintenance 64,603 54,924Management services 15,000 14,967Professional services 7,784 9,887Administrative and office expense 9,879 10.591

Total Operating Expenses 237,595 238.546

Total Fixed Charges andOperating Expenses 491,814 489 . 996

Excess Revenues over Expenses (Expensesover Revenues) before Depreciationand Amortization $ 7.483 $ ( 754




COMPARATIVE SCHEDULE OF SUPPLIES, REPAIRS AND MAINTENANCE


Supplies

Repairs and MaintenanceBoiler, heating and plumbingElevator maintenance and repairsExterminating

Landscaping and treesRoofing and waterproofingIntercom, security and electrical

Doors, locks and windowsPlastering and paintingFire safety

CompactorEquipmentGarage doors

Engineer feesGeneral

Total Supplies, Repairsand Maintenance

$ 6,166 $ 6, 840

20,230 15,4845,456 4,8312,849 3,657

9,172 12,5244,355 1,500

335 1,574

62

2

2

808,580,488

737,864

562.001

1,252520657

7371,900

298

3. 150




COMPARATIVE STATEMENT OF CASH FLOWS


Cash Flows from Operating ActivitiesExcess of revenues over expenses

(expenses over revenues) beforedepreciation and amortization

Adjustments to reconcile excess ofrevenues over expenses (expensesover revenues) before depreciationto cash (used in) provided byoperating activities:(Increase) decrease in:Proprietary rents receivableEscrow - real estate taxPrepaid insurancePrepaid NYS corporation taxes

Increase (decrease) in:Accounts payableSTAR abatements payableNYS corporation tax payablePrepaid proprietary rents

Cash (Used in) Provided byOperating Activities

Cash Flows from Investing ActivitiesBuilding improvements additionsImprovements-in-progressEquipment additions

Cash (Used in) InvestingActivities

Cash Flows from Financing ActivitiesMortgage paymentsIncrease in paid-in capital

Cash Provided by FinancingActivities

Net (Decrease) in Cash

Cash - Beginning of Year

Cash - End of Year

7,483 $ ( 754

( 5

( 3

( 146

( 7

( 20

( 2

( 22

( 1717

,562)206,121)188

,179),762841265

, 117)

,200)-,0131

.2131

,873)^_873

10731

15( 7

29

(32768

( 14

(272

( 1616

,681,564,347,000

,610,866)_

21

,603

,171),805.000)

.366 )

,486)^486

( 29

163

$ 134

,330)

.877

,547

(242

406

$ 163

,763)

. 640

, 877




NOTES TO FINANCIAL STATEMENTS


(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Organization

77 Bronx River Road Owners, Inc., which qualifies as acooperative housing corporation in accordance with Section 216of the Internal Revenue Code, was incorporated in the State ofNew York on June 28, 1984.

The land and building are stated at $401,843 in accordancewith the Internal Revenue Code Section 351 guidelines forvaluation of apartment buildings.

Property

Property is stated at cost. Maintenance, repairs andrecurring replacements are charged to operations as incurred.Expenditures which improve or extend the useful lives ofproperties are capitalized.

The building and building improvements are being depreciatedover their estimated useful lives using the straight-linemethod. Equipment purchases are being depreciated over theirestimated useful lives using an accelerated method.

Estimates

The preparation of financial statements in conformity withgenerally accepted accounting principles requires managementto make estimates and assumptions that affect certain reportedamounts and disclosures. Accordingly, actual results coulddiffer from those estimates.

Concentrations of Credit Risk

Financial instruments that potentially subject the Cooperativeto concentrations of credit risk consist principally oftemporary cash investments. The Cooperative maintains itstemporary cash investments with high credit quality financialinstitutions. At times such amounts may exceed Federallyinsured limits.





(2) MORTGAGE REFINANCING:

In 2013 the Cooperative refinanced its mortgage with NationalConsumer Cooperative Bank (NCB) in the amount of $2,060,000.The ten year mortgage bears interest at a fixed rate of 4.75percent per annum and matures on September 1, 2023. Paymentsof interest and principal in the amount of $9,594.61 are duemonthly pursuant to a 40 year amortization schedule. AtDecember 31, 2015 the outstanding mortgage balance was$2,022, 150.

Proceeds from the refinanced mortgage were used to (a) satisfythe prior mortgage in the amount of $919,160, (b) satisfy theoutstanding balance of the equity line of credit in the amountof $750,000, (c) finance the prepayment penalty of $18,383,(d) increase the Cooperative's reserve account, (e) invest inthe stock of NCB in the amount of $5,600 as required by theBank and (f) finance mortgage refinancing costs of $74,479.

In addition, the Cooperative obtained a ten year line ofcredit loan in the amount of $1,000,000 with NCB. The line ofcredit bears interest at an adjustable rate of LIBOR plus3.85 percent per annum and matures with the mortgage onSeptember 1, 2023. Installment payments of interest only arerequired on a monthly basis for the first three years withmonthly payments of interest and principal of $100 duethereafter. At December 31, 2015 the line of credit has notbeen utilized.

Mortgage refinancing costs of $74,479 are being amortized overthe life of the mortgage.

(3) NCB STOCK:

At December 31, 2015 the Cooperative has an investment in NCBClass B capital stock in the amount of $7,776. In 2010 theCooperative became a member of the Bank with an investment of$2,176. An additional investment of $5,600 was required atthe mortgage refinancing in 2013.

NCB will return this investment to the Cooperative at maturityof the mortgage.





(4) PROPRIETARY RENTS:

Proprietary rents charged to stockholders include funds usedto amortize the mortgage. The mortgage amortization amountreduces the Cooperative's proprietary rents revenue andincreases its additional paid-in capital. Accordingly, thecost basis of each stockholder's unit is increased by his orher proportionate share of the portion of proprietary rentspayments which are being used to amortize the mortgage.For the years ended December 31, 2015 and 2014 mortgageamortization was $17,298 and $16,486, respectively.

On April 1, 2015 proprietary rents assessed were increased2 percent. The following amounts were billed:

Proprietary rents $ 472,725 $ 462,753

(5) BUILDING IMPROVEMENTS:

In 2015 building improvements were increased by $20,200 for(a) a new lobby door in the amount of $1,400, (b) roof parapetrestoration in the amount of $3,000, (c) garage floorrenovation in the amount of $9,000 and (d) driveway sealing inthe amount of $6,800.

In 2014 building improvements were increased by $327,171 for(a) the retaining wall project in the amount of $215,304,(b) guardrail for the retaining wall in the amount of $32,000,(c) driveway paving in the amount of $45,000, (d) renovationof the building stairs in the amount of $9,000, (e) renovationof the lobby in the amount of 19,667 and (f) new mailboxes inthe amount of $6,200.

(6) REAL ESTATE TAXES:

Real estate tax expense is reported at full assessed amountswithout reduction for the New York State School Tax Relief(STAR) Program abatements which are directly credited to thequalifying stockholders. Current liabilities include $39,745and $32,983 of credits payable to stockholders by theCooperative at December 31, 2015 and 2014, respectively.





7) CORPORATION INCOME TAXES:

The Cooperative is subject to Federal and New York Stateincome taxes. No provision was required for Federal incometaxes. New York State corporation taxes were providedbased on capital at reduced rates applicable to cooperativehousing corporations.

The 2015 tax provision was comprised of Federal income tax of$0 and New York State corporation tax of $1,029 and the 2014tax provision was comprised of Federal income tax of $0 andNew York State corporation tax of $1,038.

;8) FUTURE MAJOR REPAIRS AND REPLACEMENTS:

The Cooperative has not conducted a study to determine theremaining useful lives of the components of common propertyand current estimates of costs of major repairs andreplacements that may be required in the future. The Boardhas also not developed a plan to fund those needs. Whenreplacement funds are needed to meet future needs for majorrepairs and replacements the Cooperative has the right toincrease regular assessments, pass special assessments ordelay major repairs and replacements until funds areavailable. The effect on future assessments has not beendetermined at this time.

Notwithstanding the foregoing the Cooperative performsnecessary capital improvement projects and preventivemaintenance on an ongoing, as needed basis and finances samefrom the reserve fund, operating account or via maintenanceincreases or assessments. Furthermore, the Cooperative hasperformed capital improvements during both the current andprior years.


Documents

77 BRONX RIVER ROAD OWNERS, INC FINANCIAL STATEMENTS ... · PAMELA E KAPLAN CPA, PC. 77 BRONX RIVER ROAD OWNERS, INC Page Accountant's Report 1-2 ... presentation of the financial