2011-11-08T14:11:03-06:00 2011-06-30 HENDERSON HUTCHERSON & MCCULLOUGH PLLC 1200 MARKET STREET CHATTANOOGA TN 37402 990 2010-07-01 630182345 SAND MOUNTAIN ELECTRIC COOPERATIVE SAND 2566382153 402 MAIN ST WEST RAINSVILLE AL 35986 MARK MALONE 2566382153 2011-10-26 1 JERRY SMITH 4237567771 2011-10-26 2010 2016-02-24 21:20:13Z MARK MALONE 402 MAIN STREET WEST RAINSVILLE AL 35986 74866491 0 X WWW.SMEC.COOP X 1940 AL THE COOPERATIVE PROVIDES ELECTRICITY TO ITS MEMBERS 9 9 79 0 0 0 0 0 64203643 73849914 293943 292654 755664 723923 65253250 74866491 0 0 0 0 5661856 5849816 0 0 0 58143383 65553492 63805239 71403308 1448011 3463183 85961463 98956717 41983119 51013671 43978344 47943046 TO PROVIDE ELECTRIC SERVICE TO THE PEOPLE IN RURAL AREAS AT THE LOWEST COST POSSIBLE, CONSISTENT WITH SOUND BUSINESS PRACTICES. 0 0 71403308 TO PROVIDE ELECTRICITY TO ITS 30,705 CONSUMERS. 71403308 0 0 0 0 0 0 0 0 1 0 0 0 1 1 1 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 0 1 47 0 1 79 1 0 0 0 0 0 72273867 2592624 0 X 9 9 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 0 X MARK MALONE 2566382153 402 MAIN STREET WEST RAINSVILLE AL 35986 JAMES P CARMICHAEL 4.50 X X 20447 0 0 LARRY G GODWIN 4.00 X X 26468 0 0 R LEE BAILEY 4.00 X X 26310 0 0 LEO BOMIAN 3.00 X X 25545 0 0 DAVID HENDERSON 3.00 X X 17224 0 0 JERRY MASON 3.00 X X 20031 0 0 ROLAND HENDON 3.00 X X 20424 0 0 JAMIE BOWMAN 3.00 X X 19224 0 0 RAYMOND LONG 3.00 X X 21624 0 0 MIKE SIMPSON 45.00 X X 169723 0 73796 MARK MALONE 45.00 X X 120559 0 28078 KEVIN ANDERSON 45.00 X 115980 0 33595 BOYD GRABEN 45.00 X 108643 0 56375 R BRIAN HORTON 50.00 X 109275 0 44107 DIANE B HALE 45.00 X 100426 0 56008 ORVILLE HUGHES 0.00 X 12516 0 0 934419 0 291959 6 1 1 0 ASPLUNDH P O BOX 532729 ATLANTA GA 30353 RIGHT OF WAY CLEARING 872192 GOSS ELECTRIC COMPANY INC 137 WOODALL ROAD DECATUR AL 35601 SUBSTATION CONSTRUCTION 331571 BLACKOAK SERVICES INC P O BOX 2192 RAINSVILLE AL 35986 METER READING SERVICES 326073 SERVICE ELECTRIC COMPANY PO BOX 11154 CHATTANOOGA TN 37401 ELECTRIC CONSTRUCTION 305897 SOUTHEASTERN DATA COOPERATIVE INC 100 ASHFORD CENTER NORTH SUITE 500 ATLANTA GA 30338 DATA PROCESSING SERVICES 305742 7 ELECTRIC SALES 221000 72273867 72273867 EXTRAORDINARY INCOME - 221000 1576047 1576047 73849914 292654 292654 723923 723923 723923 723923 74866491 73849914 0 1016577 934419 4915397 1621241 3390516 98440 COST OF POWER 53959070 DISTRIBUTION - MAINTENA 3350746 TAX EXPENSE 2351403 CONSUMER ACCOUNTS 2103461 DISTRIBUTION - OPERATIO 2082621 -3404006 71403308 1070848 965141 5386191 8249480 583145 1184253 816690 778146 121514499 38081808 73903883 83432691 2099990 2313246 2100716 2033760 85961463 98956717 6555918 11863965 30102185 28831109 1000000 6321483 4325016 3997114 41983119 51013671 X 456620 458795 0 0 43521724 47484251 43978344 47943046 85961463 98956717 X 3463183 501519 X X 0 1 1 X 1 0 150374 150374 3077708 944598 2133110 110364469 37137210 73227259 7921948 7921948 83432691 CUSTOMER DEPOSITS 2356252 POSTRETIREMENT BENEFIT OBLIGATION 1640862 3997114 74866491 71403308 3463183 510221 -8702 501519 3964702 74866491 0 74866491 0 74866491 71403308 0 71403308 0 71403308 DESCRIPTION OF UNCERTAIN TAX POSITIONS UNDER FIN 48: PART X: NOTE 11 UNCERTAIN TAX POSITIONS EFFECTIVE JANUARY 1, 2009, THE COOPERATIVE IMPLEMENTED THE ACCOUNTING GUIDANCE FOR UNCERTAINTY IN INCOME TAXES USING THE PROVISIONS OF ASC TOPIC 740, INCOME TAXES (PREVIOUSLY FASB INTERPRETATION NO. 48, ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES AN INTERPRETATION OF FASB STATEMENT NO. 109). THE ADOPTION OF FASB ASC 740 DID NOT HAVE A MATERIAL IMPACT ON THE COOPERATIVES FINANCIAL STATEMENTS. THE COOPERATIVE HAS CONCLUDED THAT THERE ARE NO SIGNIFICANT UNCERTAIN TAX POSITIONS REQUIRING DISCLOSURE, AND THERE ARE NO MATERIAL AMOUNTS OF UNRECOGNIZED TAX BENEFITS. THE COOPERATIVES EVALUATION WAS PERFORMED FOR TAX YEARS ENDED JUNE 30, 2008 THROUGH JUNE 30, 2011, THE YEARS THAT REMAIN SUBJECT TO EXAMINATION BY MAJOR TAX JURISDICTIONS AS JUNE 30, 2011. PART XI, LINE 8 - OTHER ADJUSTMENTS: INCREASE IN CAPITAL STOCK (MEMBERSHIPS) 2,175. OTHER COMPREHENSIVE LOSS - APBO -10,877. OTHER FIXED ASSETS IS MADE UP OF CONSTRUCTION WORK IN PROGRESS X X X 0 0 0 MIKE SIMPSON 169723 0 0 0 0 0 72299 0 1497 0 243519 0 0 0 BOYD GRABEN 108643 0 0 0 0 0 35894 0 20481 0 165018 0 0 0 R BRIAN HORTON 109275 0 0 0 0 0 42610 0 1497 0 153382 0 0 0 DIANE B HALE 100426 0 0 0 0 0 35527 0 20481 0 156434 0 0 0 ORVILLE HUGHES 12516 0 0 0 0 0 0 0 0 0 12516 0 0 0 FORM 990, PART VI, SECTION A, LINE 6 THE ORGANIZATION HAS 30,705 CONSUMERS THAT IT PROVIDES ELECTRICITY TO. FORM 990, PART VI, SECTION A, LINE 7A THE MEMBERS OF SAND MOUNTAIN ELECTRIC COOPERATIVE ELECT THE BOARD OF DIRECTORS THROUGH A DEMOCRATIC PROCESS. FORM 990, PART VI, SECTION A, LINE 7B MEMBERS DECISIONS ARE LIMITED TO ELECTION OF TRUSTEES AND CHANGING BY-LAWS. FORM 990, PART VI, SECTION B, LINE 11 THE INDEPENDENT CPA HIRED BY SMEC WILL REVIEW THE 990 WITH THE BOARD OF DIRECTORS BEFORE IT IS SUBMITTED TO THE IRS. FORM 990, PART VI, SECTION B, LINE 12C KEY EMPLOYEES AND TRUSTEES ARE REQUIRED TO FILL OUT TWO SEPARATE QUESTIONNAIRES ANNUALLY DISCLOSING ANY CONFLICTS OF INTEREST. FORM 990, PART VI, SECTION B, LINE 15 THE BOARD OF DIRECTORS SETS THE GENERAL MANAGER'S COMPENSATION SEPARATELY FROM THE OTHER EMPLOYEES AFTER REVIEWING AREA (ALABAMA RURAL ELEC. ASSOC.) SALARY SURVEYS. THE GM HAS A WRITTEN EMPLOYMENT CONTRACT. THE OTHER OFFICERS, KEY EMPLOYEES (LISTED MANAGERS) SALARY IS SET BY THE BOARD WITH A RECOMMENDATION FROM THE GM. THEY USE THE AREA SALARY SURVEY IN THE PROCESS. ALL OF OUR EMPLOYEE PAY RATES ARE SET BY THE BOARD. THE MAJORITY ARE UNDER A UNION CONTRACT THAT IS NEGOTIATED BY A COMMITTEE OF THE BOARD AND APPROVED BY THE FULL BOARD. 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. CHANGES IN NET ASSETS OR FUND BALANCES: FORM 990, PART XI, LINE 5: PRIOR PERIOD ADJUSTMENTS: 510,221. INCREASE IN CAPITAL STOCK (MEMBERSHIPS) 2,175. OTHER COMPREHENSIVE LOSS - APBO -10,877. TOTAL TO FORM 990, PART XI, LINE 5: 501,519. AUDIT OVERSIGHT PROCESS REMAINS UNCHANGED FROM THE PRIOR YEAR. EXPLANATION AS TO WHY ORGANIZATION HAS NOT UNDERGONE REQUIRED SINGLE AUDIT FOR 990, PG. 12, PART XII, QUESTION 3B SAND MOUNTAIN HAS NOT YET UNDERGONE THE REQUIRED SINGLE AUDIT FOR THE FEMA DISASTER GRANT RECEIVED DURING THE YEAR. THIS IS DUE TO THE FACT THAT FEMA HAS NOT YET FINISHED THEIR AUDIT AND THE FULL AMOUNT OF THE GRANT HAS NOT YET BEEN DETERMINED BY FEMA. HOWEVER, SAND MOUNTAIN IS IN THE PROCESS OF STARTING THIS AUDIT AND THE SINGLE AUDIT WILL BE COMPLETED BEFORE THE END OF THE CALENDAR YEAR. EXTRAORDINARY INCOME FORM 990, PG. 9, PART VIII, LNE 2B IN SEPTEMBER 2010, THE COOPERATIVE REVISED ITS REVENUE RECOGNITION POLICY. THE COOPERATIVE USES A CYCLE BILLING SYSTEM UNDER WHICH ITS CUSTOMERS HAVE STAGGERED BILLING DATES THROUGHOUT THE MONTH. BEGINNING IN SEPTEMBER 2010, THE COOPERATIVE BEGAN RECOGNIZING THE PORTION OF ENERGY REVENUE SOLD BUT UNBILLED THROUGH THE END OF EACH MONTH. IN ADDITION, ALSO EFFECTIVE SEPTEMBER 2010, THE SOLE SUPPLIER OF WHOLESALE POWER TO THE COOPERATIVE CHANGED ITS BILLING PROCEDURES FROM A MID-MONTH BILLING DATE TO AN END OF MONTH BILLING DATE. THE TWO FOREGOING CHANGES RESULTED IN THE TWO EXTRAORDINARY ITEMS REFLECTED IN THE 990. AS RECOMMENDED BY THE COOPERATIVES GOVERNING BODY, TVA, THE COST OF POWER AND UNBILLED REVENUE ADJUSTMENTS WERE RECORDED AS EXTRAORDINARY ITEMS. FOR THE YEAR ENDED JUNE 30, 2011, THE TOTAL COST OF POWER AND UNBILLED REVENUE ADJUSTMENTS WERE $1,297,953 AND $2,874,000, RESPECTIVELY. THE NET EFFECT OF THESE TWO ADJUSTMENTS IS EXTRAORDINARY INCOME OF $1,576,047.