Office review·August 23, 2021

At this informal conference present were Randy Brown, Executive Director; Michael Beeman, Chief Financial Officer; Pam Kaufmann, attorney; Mark Damon, Certified Public Accountant; Jim Stearman, attorney; Stan Leach, Licensee Board Member, Bill Hendrickson, CDSS Financial Consultant, William Young, Financial Analyst; Paramjit Judge, Financial Analyst; Marina Stanic, Licensing Program Manager; Allison Nakatomi, Manager; and Katie Anderson, Assistant Branch Chief. The informal conference process was explained to the Licensee. During the meeting the following was discussed with Licensee: - Clarifying line items in calculating the monthly burn rate. - Outstanding issues not addressed from last meeting. The following was agreed upon: - By August 24, 2021, CCLD will update the spreadsheet to reflect agreed upon methodology to calculate the monthly burn rate and will provide to the Licensee. * Operating Cash Inflow § Entrance fees (cash) received can be included § Donations can be included § Amortization must be deducted (if included in total revenue) § Non-recurring revenue must be deducted, such as grants or federal assistance (if included in total revenue) § Entrance fee refunds must be deducted * Operating Cash Outflow § Non-Cash Depreciation must be deducted § Non-recurring COVID 19 extra Expense can be deducted * Debt – Include payments made and do not include Line of Credit (if reporting debt payments here, those can be excluded from the expenses) - By September 7, 2021, Licensee will provide additional information to confirm the amounts for the grants, entrance fees and COVID 19 expenses as of June 30, 2021. - By September 7, 2021, Licensee will provide projections for the 12-month period for Balance Sheet and Statement of Cash Flows. The Department has the Profit and Loss with amended Corrective Action Plan (CAP). - By August 24, 2021, CCLD will provide the CAP Milestones template to be completed by the Licensee and returned to CCLD by September 7, 2021. - By September 7, 2021, Licensee will respond to clarify the “Other Strategies” identified in CAP: * Peer Consulting needs definition * Added Board Expertise * Management Consultant additional burden * Verify that Attorneys’ fees are captured in the budget Mark Damon (CPA) explained that his role is in an advisory capacity as an independent consultant and that the Licensee is responsible for all management decisions. An exit interview was conducted, and a copy of this report issued to the Licensee.