2011-05-16T22:05:07-05:00 2010-06-30 KPMG LLP PO BOX 4150 Honolulu HI 968124150 990 2009-07-01 990073523 PUNAHOU SCHOOL PUNA 8089445711 1601 PUNAHOU STREET HONOLULU HI 96822 JILL KAWANO 8089445711 2011-05-16 true 8085402800 2009 2016-02-24 21:20:13Z JILL KAWANO 1601 PUNAHOU STREET HONOLULU HI 96822 127780918 false X WWW.PUNAHOU.EDU X 1853 HI PUNAHOU SCHOOL IS A PRIMARY AND SECONDARY SCHOOL THAT IS RECOGNIZED FOR ITS ACADEMIC EXCELLENCE, ATHLETIC PROGRAMS, AND EXTRACURRICULAR ACTIVITIES. MORE THAN 3750 STUDENTS ATTEND THE SCHOOL IN GRADES K-12. 19 16 1967 5000 -242829 -242829 11522658 14370032 71227637 73997061 7547750 2026638 2170208 2204748 92468253 92598479 3706553 4010702 0 0 59303389 61016021 0 0 2290997 22684243 21674594 85694185 86701317 6774068 5897162 312359609 333390084 37800816 45380878 274558793 288009206 PUNAHOU IS COMMITTED TO PROVIDE AN ENVIRONMENT WHERE STUDENTS CAN DEVELOP MORAL AND SPIRITUAL VALUES CONSISTENT WITH THE CHRISTIAN PRINCIPLES ON WHICH PUNAHOU WAS FOUNDED, AFFIRMING THE WORTH AND DIGNITY OF EACH INDIVIDUAL; DEVELOP INTELLECTUAL, ACADEMIC AND PHYSICAL POTENTIAL TO THE FULLEST DEGREE, PREPARING THEM FOR COLLEGE AND FOR CHALLENGES FACING THEM NOW AND IN THE FUTURE; DEVELOP AND ENHANCE CREATIVITY AND APPRECIATION FOR THE ARTS; APPRECIATE CULTURAL DIVERSTIY AND DEVELOP SOCIAL RESPONSIBILTY. FOUNDED IN 1841, PUNAHOU SCHOOL IS THE LARGEST INDEPENDENT SCHOOL IN AMERICA. IT IS A PRIVATELY OPERATED SCHOOL SERVING CHILDREN FROM EVERY RACIAL, RELIGIOUS, SOCIAL AND ECONOMIC GROUP IN HAWAII. PUNAHOU HAS FACULTY AND ACADEMIC SUPPORT STAFF OF APPROXIMATELY 600, SERVING ABOUT 3,750 STUDENTS FROM KINDERGARTEN TO GRADE 12. THE SCHOOL IS DIVIDED INTO TWO MAJOR DIVISIONS: THE JUNIOR SCHOOL (KINDERGARTEN TO GRADE 8) AND THE ACADEMY (GRADES 9 TO 12), EACH WITH ITS OWN PRINCIPAL. IN ADDITION, false false 63457703 4010702 68056059 ACADEMIC CURRICULUM - PUNAHOU SCHOOL IS A COEDUCATIONAL COLLEGE PREPATORY DAY SCHOOL OFFERING EDUCATIONAL EXCELLENCE. MORE THAN 96 PERCENT OF PUNAHOU GRADUATES GO ON TO ATTEND COLLEGE. CURRENTLY, PUNAHOU IS DIVIDED INTO THE JUNIOR SCHOOL, KINDERGARTEN THROUGH GRADE 8, AND THE ACADEMY, GRADES 9-12. THE JUNIOR SCHOOL (K-8) IS COMPOSED OF THREE SECTIONS WITH A PRINCIPAL AND FIVE SUPERVISORS OVERSEEING APPROXIMATELY 2,000 STUDENTS. THESE SMALLER, SELF-CONTAINED SECTIONS FOR K-2, 3-5 AND 6-8 ARE DESIGNED TO MEET THE SPECIAL NEEDS OF THESE GROUPS OF CHILDREN. SUPPLEMENTAL EDUCATION, SUCH AS OUTDOOR AND CAMP EXPERIENCES, ARE ALSO OFFERED IN THE JUNIOR SCHOOL. NEW FACILITES WERE COMPLETED IN 2005 FOR GRADES 6-8 IN THE CASE MIDDLE SCHOOL AT PUNAHOU. THIS EXPANDED AREA OF CAMPUS WAS DESIGNED TO SUPPORT AN EDUCATION PROGRAM DESIGNED SPECIFICALLY TO MEET THE INTELLECTUAL AND SOCIAL NEEDS OF EARLY ADOLESCENTS. THE LEARNING ENVIRONMENT RECOGNIZES THIS DEVELOPMENTAL PERIOD THROUGH MORE INTIMATE ORGANIZATIONAL STRUCTURES, FACILITIES MORE OPEN TO THE ENVIRONMENT AND CLASSROOM AND GATHERING SPACES DESIGNED TO ENCOURAGE COLLABORATION AND INTEGRATED LEARNING. IN THE ACADEMY, COLLEGE PREPARATORY GRADUATION REQUIREMENTS INCLUDE CREDITS IN ENGLISH, SCIENCE, SOCIAL STUDIES, MATHEMATICS, FOREIGN LANGUAGE, PHYSICAL EDUCATION, PERFORMING ARTS, AND COMMUNITY SERVICE. 4460424 3345246 SUMMER SCHOOL OFFERS A VARIED AND ENRICHED PROGRAM IN ACADEMICS, SPORTS, MUSIC AND DANCE. THE PROGRAMS STIMULATE INTEREST, CREATIVITY AND ENJOYMENT IN SPECIAL AREAS THAT ARE NOT ALWAYS COVERED DURING THE REGULAR SCHOOL YEAR. 3119820 2569739 CO-CURRICULAR ACTIVITIES ARE AN ESSENTIAL PART OF THE PUNAHOU EXPERIENCE, HELPING STUDENTS DEVELOP A SENSE OF RESPONSIBILITY, COMMITMENT, CONFIDENCE AND LEARDERSHIP. WITH A FOCUS ON EXPERIENTIAL, HANDS-ON, AND COLLABORATIVE LEARNING, THE CURRICULUM IS SUPPORTED BY A WIDE VARIETY OF MEDIA SERVCIES, TECHNOLOGY RESOURCES AND A WELL-ROUNDED ARTS PROGRAM. 2120513 26017 ATHLETICS 411473 MUSIC & THEATER PROGRAMS 84259 STUDENT ACTIVITIES 2616245 26017 73654192 true true false false true false false false true true true false true false false false false false true false false false true true false false false false false false true true true true false false false false false false false true 105 0 true 1967 true true true true CJ EI false false false false false false false false false false 19 16 false false false false false false false true true false false true true true true true true true true false HI X PUNAHOU SCHOOL 8089445711 1601 PUNAHOU STREET HONOLULU HI 96822 ETHAN DB ABBOTT 1.0 X 0 0 0 W DAVID P CAREY III 1.0 X 0 0 0 STEPHEN B CASE 1.0 X 0 0 0 HAN H SONNY CHING 1.0 X 0 0 0 MARGARET M COLE 1.0 X 0 0 0 MARY M COOKE 1.0 X 0 0 0 WENDY B CRABB 1.0 X 0 0 0 JUDITH M DAWSON 1.0 X 0 0 0 MARK H FUKUNAGA 1.0 X 0 0 0 RONALD D HIGGINS II 1.0 X 0 0 0 CLAIRE O JOHNSON 1.0 X 0 0 0 CONSTANCE LAU 1.0 X 0 0 0 WARREN KK LUKE 1.0 X 0 0 0 DUNCAN MACNAUGHTON 1.0 X 0 0 0 RANDOLPH G MOORE 1.0 X 0 0 0 PIERRE M OMIDYAR 1.0 X 0 0 0 MICHAEL A PIETSCH 1.0 X 0 0 0 JEFFREY N WATANABE 1.0 X 0 0 0 KATHLEEN SULLIVAN WO 1.0 X 0 0 0 JAMES K SCOTT 40.0 X 382027 0 30300 JOHN D FIELD JR 40.0 X 222533 0 15307 JILL M KAWANO 40.0 X 122167 0 12217 KEVIN E CONWAY 40.0 X 240617 0 20685 MICHAEL T WALKER 40.0 X 217283 0 26805 COLLEEN F SOTOMURA 40.0 X 172333 0 24513 BARBARA Y MORGAN 40.0 X 147000 0 22237 JOHN R OVERTON 40.0 X 139094 0 21125 MARGUERITE ASHFORD-HIRANO 40.0 X 136831 0 24755 BETSY HATA 40.0 X 132833 0 19545 PAULA G HODGES 40.0 X 132596 0 20749 2045314 0 238238 44 false true false CAMBRIDGE ASSOCIATES PO BOX 10317 UNIONDALE NY 115550317 CONSULTING SERVICES 387733 TORKILDSON KATZ MOORE ASSOCIAT 700 BISHOP STREET 15TH FLOOR HONOLULU HI 968134187 LEGAL SERVICES 144753 2 153911 14216121 767937 14370032 TUITION & FEES 900099 71448142 71448142 INSTRUCTIONAL SERVICES 900099 2548919 2548919 73997061 2981340 -237350 3218690 0 0 125530 250586 -125056 -125056 0 -125056 31960230 6250 32921182 0 -960952 6250 -954702 -5479 -949223 1987900 153911 1767491 220409 220409 0 194623 243180 -48557 -48557 CAFETERIA 900099 2157952 2157952 2157952 92598479 73997061 -242829 4474215 0 4010702 4010702 0 0 1478571 513225 765321 200025 0 42852702 37189349 4503866 1159487 3303701 2857155 358154 88392 10057767 9144120 724261 189386 3323280 2833761 389156 100363 0 166121 164725 1396 79935 79935 0 0 529425 529425 1142622 324832 693827 123963 282327 203486 22269 56572 1063740 435686 396877 231177 1469724 1253233 172105 44386 570 570 2191383 2130383 56398 4602 670090 599484 41849 28757 0 147218 95467 23682 28069 0 0 7654557 7441482 197000 16075 0 OPERATION OF PHYSICAL PLANT 1287036 1287036 ADMINISTRATION EXPENSE 368589 350242 18347 INSTRUCTIONAL EXPENSE 2920243 2920243 CAFETERIA EXPENSE 1136825 1136825 ATHLETIC EXPENSE 390841 390841 173348 173348 86701317 73654192 10756128 2290997 22182506 8191594 5163891 6034607 1403817 5270686 139922 500059 317876 308515 238644 220886 1290669 1694452 217007454 88535931 113160304 128471523 70949353 70711368 80005697 93480389 17506930 18506005 312359609 333390084 21098196 24877719 6412994 6962637 4300000 8500000 5989626 5040522 37800816 45380878 X 181058229 197893461 43509883 37807580 49990681 52308165 274558793 288009206 312359609 333390084 X false true true X false X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 3 94090 250350 5076226 true true 163804927 2776231 5541002 235152 171887008 183820790 3086361 -22874584 227640 163804927 0.53224 0.30934 0.17843 false false 500498 500498 132439730 48085354 84354376 13317773 6989949 6327824 43332396 32771813 10560583 27417057 688815 26728242 128471523 INVESTMENT IN LTD PARTNERSHIPS 93480389 F 93480389 BENEFICIAL INTEREST IN 18506005 18506005 0 DEPOSITS HELD IN CUSTODY 814696 CAPITAL LEASE 961038 LIABILITY UNDER SPLIT-INTEREST AGREEMENTS 1977115 OTHER LIABILITIES 1287673 5040522 92598479 86701317 5897162 8772679 -1219428 7553251 13450413 104644878 8772679 1313468 10086147 94558731 529425 -2489677 -1960252 92598479 91194465 5022573 5022573 86171892 529425 529425 86701317 RECONCILIATION OF CHANGES IN NET ASSETS SCHEDULE D, PART XI, LINE 8 OTHER ADJUSTMENTS ARE AS FOLLOWS: CHANGE IN VALUE OF SPLIT-INT AGR: 1,070,288 ACCOUNTING ADJ FOR FASB 158: (2,761,316) BOOK/TAX DIFFERENCE FROM PARTNERSHIPS: 471,600 ----------- TOTAL (1,219,428) RECONCILIATION OF REVENUE SCHEDULE D, PART XII, LINE 2D OTHER ADJUSTMENTS ARE AS FOLLOWS: CHANGE IN VALUE OF SPLIT-INT AGR: 1,070,288 BOOKSTORE EXPENSES NET ON 990: 243,180 ---------- TOTAL 1,313,468 RECONCILIATION OF REVENUE SCHEDULE D, PART XII, LINE 4B OTHER ADJUSTMENTS ARE AS FOLLOWS: CARNIVAL EXPENSES NET ON 990: (1,767,491) RENTAL EXPENSES NET ON 990: ( 250,586) GAIN DISTRIBUTED FROM PARTNERSHIPS: ( 612,729) BOOK/TAX DIFFERENCE FROM PARTNERSHIPS: 141,129 ----------- TOTAL (2,489,677) RECONCILIATION OF EXPENSES SCHEDULE D, PART XIII, LINE 2D OTHER ADJUSTMENTS ARE AS FOLLOWS: CARNIVAL EXPENSES NET ON 990: 1,767,491 RENTAL EXPENSES NET ON 990: 250,586 BOOKSTORE EXPENSES NET ON 990: 243,180 ACCOUNTING ADJ FOR ADOPTION OF FASB 158: 2,761,316 ---------- TOTAL 5,022,573 FIN 48 FOOTNOTE SCHEDULE D, PART X, LINE 2 IN JUNE 2006, THE FASB ISSUED ASC TOPIC 740-10 (INTEREPRETATION 48), INCOME TAXES (ASC TOPIC 740), WHICH PRESCRIBES A "MORE-LIKELY THAN-NOT" RECOGNITION THRESHOLD AND MEASUREMENT ATTRIBUTE (THE LARGEST AMOUNT OF BENEFIT THAT IS GREATER THAN 50% LIKELY OF BEING REALIZED UPON ULTIMATE RESOLUTION WITH TAX AUTHORITIES) FOR THE FINANCIAL STATEMENT RECOGNITION AND MEASUREMENT OF AN INCOME TAX POSITION EXPECTED TO BE TAKEN IN A TAX RETURN. THE SCHOOL ADOPTED ASC TOPIC 740 AS OF JULY 1, 2009 AND THE ADOPTION DID NOT HAVE ANY IMPACT ON THE ACCOMPANYING FINANCIAL STATEMENTS. INTENDED USES OF THE ORGANIZATION'S ENDOWMENT FUNDS SCHEDULE D, PART V, LINE 4 THE PRIMARY PURPOSE OF THE ENDOWMENT FUNDS FOR PUNAHOU SCHOOL IS THE CREATION AND MAINTENANCE OF SCHOLARSHIPS IN ORDER TO HELP ALLEVIATE THE COST OF EDUCATING THEIR STUDENTS. true true true STATED IN PERIODIC NEWSPAPER ADVERTISEMENT. true true true true false false false false false false false false false true CARNIVAL 2141811 153911 1987900 19956 207785 1539750 0 2141811 153911 1987900 19956 207785 1539750 1767491 220409 true 0 0 SCHOLARSHIPS 513 4010702 0 PROCEDURES FOR MONITORING USE OF GRANT FUNDS FORM 990, SCHEDULE I, PART I, LINE 2 GRANT FUNDS CONSIST ALMOST ENTIRELY OF SCHOLARSHIPS AND FINANCIAL AID, WHICH ARE GIVEN TO STUDENTS IN THE FORM OF TUITION REDUCTIONS OR WAIVERS. FUNDS ARE ALSO SET ASIDE FOR THE REIMBURSEMENT OF SCHOOL SUPPLIES FOR SOME STUDENTS. THESE STUDENTS MUST SUBMIT RECEIPTS DETAILING THEIR PURCHASES SO THAT PUNAHOU CAN VERIFY THAT AMOUNTS SUBMITTED FOR REIMBURSEMENT CONSIST ENTIRELY OF APPROVED EXPENDITURES. X X X X true true X X X false false false false false false false false false JAMES K SCOTT 321227 0 50000 0 10800 0 20302 0 9998 0 412327 0 0 0 JOHN D FIELD JR 191333 0 0 0 31200 0 15307 0 0 0 237840 0 0 0 KEVIN E CONWAY 209417 0 0 0 31200 0 16753 0 3932 0 261302 0 0 0 MICHAEL T WALKER 210083 0 0 0 7200 0 16807 0 9998 0 244088 0 0 0 COLLEEN F SOTOMURA 172333 0 0 0 0 0 13787 0 10726 0 196846 0 0 0 BARBARA Y MORGAN 147000 0 0 0 0 0 14700 0 7537 0 169237 0 0 0 JOHN R OVERTON 139094 0 0 0 0 0 11127 0 9998 0 160219 0 0 0 MARGUERITE ASHFORD-HIRANO 136831 0 0 0 0 0 13683 0 11072 0 161586 0 0 0 BETSY HATA 132833 0 0 0 0 0 13283 0 6262 0 152378 0 0 0 PAULA G HODGES 132596 0 0 0 0 0 13260 0 7489 0 153345 0 0 0 DETAIL REGARDING COMPENSATION SCHEDULE J, PART I, LINE 1A FIRST-CLASS TRAVEL IS PROVIDED TO KEVIN CONWAY, ACADEMY PRINCIPAL, FOR HEALTH RELATED ISSUES, AND IS NOT TREATED AS TAXABLE COMPENSATION. SPOUSAL TRAVEL FOR SCHOOL-RELATED EVENTS IS PROVIDED FOR THE PRESIDENT ONLY, AND IS NOT TREATED AS TAXABLE COMPENSATION. THE PRESIDENT HAS DISCRETIONARY SPENDING ACCOUNTS FUNDED BY VARIOUS RESTRICTED ENDOWMENTS THAT ARE USED FOR SCHOOL-RELATED EXPENSES OR FINANCIAL AID PURPOSES. THIS IS NOT TREATED AS TAXABLE COMPENSATION. A HOUSING ALLOWANCE IS PROVIDED TO KEVIN CONWAY AND JOHN FIELD AND IS INCLUDED IN THEIR REPORTABLE COMPENSATION. EXPENSE REIMBURSEMENT POLICY SCHEDULE J, PART I, LINE 1B THE SCHOOL FOLLOWS A WRITTEN EXPENSE REIMBURSEMNT POLICY REQUIRING ALL THREE OF THE FOLLOWING: (1) THE EXPENSE MUST BE A SCHOOL-RELATED EXPENSE; (2) SUBSTANTIATION RECEIPTS ARE REQUIRED WITHIN A REASONABLE AMOUNT OF TIME; (3) EXCESS ADVANCES MUST BE RETURNED WITHIN A REASONABLE AMOUNT OF TIME. CONSTANCE LAU TRUSTEE 1668435 SEE SCHEDULE O DISCLOSURE false JEFFREY N WATANABE TRUSTEE 1668435 SEE SCHEDULE O DISCLOSURE false JOHN D FIELD OFFICER 94563 SEE SCHEDULE O DISCLOSURE false MICHAEL T WALKER KEY EMPLOYEE 74030 SEE SCHEDULE O DISCLOSURE false CLAIRE O JOHNSON TRUSTEE 83793 SEE SCHEDULE O DISCLOSURE false X 2 1100 EXPERT OPINION X 6160 COST X 6909 COST X 41 728028 SELLING PRICE X INFO TECHNOLOGY EQUIPMENT 3 11237 COST X 3000 FT OF LUMBER 1 7500 COST X FEINWERKBAU AIR RIFLE 1 1950 COST X 48 CUBIC YARDS OF TOPSOIL 1 1440 COST X 3/4 CELLO, CASE, AND BOW 1 1300 COST X GIFT CERT - PRINTERS ROW 1 1000 FACE VALUE X EASEL & 2 ROLLING RACKS 1 300 COST X 1,120 KIAWE LOGS 1 1013 COST 0 false true false NON-CASH DONATIONS DISCLOSURE SCHEDULE M. COLUMN B The organization is reporting the number of contributions received on Column B of Schedule M. For contributions of securities, each separate gift is reported on Column B. OTHER PROGRAM SERVICES FORM 990, PART III, LINE 4D Athletics - Punahou School has been a member of the ILH (Interscholastic League of Honolulu) since 1909 and fields over 115 competitive teams. Students interested in participating on an athletic team can try out for one of 23 different sports beginning in the 7th grade. Student Activities - For many students, Punahou becomes more than just a school; it serves as a community, a neighborhood, a place which provides a large part of their total environment. Thus, the student activities are varied and offer the students to opportunity to get involved in special interest clubs, May Day/Holoku Pageant and curriculum-related travel by athletic teams, speech/debate and musical groups. Theatre Programs - Theatre has a long history at Punahou. Informal classroom activities growing out of a class studies initiate play-acting in early grades. More structured stage experiences are offered in the Grades 5 and 7 Keaka Punahou Clubs and Thurston Memorial Chapel performances. Theatre opportunities in the Drama Workshop classroom or on the Dillingham stage are offered each semester for seventh and eighth graders. Academy students have the opportunity to perform in a play each semester, or to direct or act in student-initiated productions in the Drama Workshop. Formal Theatre courses are offered in Technical Theatre, Acting and Musical Theatre in the Academy. REVIEW PROCESS FOR FORM 990 FORM 990, PART VI, SECTION B, LINE 11 The Board of Trustees has delegated the review of the Form 990 to the Audit Committee. The organization's Assistant Treasurer & Controller works closely with the outside accounting firm it engages to review the return; and the final draft of Form 990 is also reviewed by the Vice President of Finance and Administration prior to providing the draft to the Audit Committee. The Audit Committee also met with the accounting firm hired to prepare the Form 990. Subsequent to its review, the Audit Committee reports back to the Board regarding its oversight of the Form 990 and the final draft is provided to the entire voting Board before the return is filed. CONFLICT OF INTEREST POLICY FORM 990, PART VI, SECTION B, LINE 12C This Conflict of Interest Policy was duly adopted by the Board of Trustees of Punahou School, a Hawaii nonprofit corporation (the School), on June 12, 2007. 1. Purpose. The Board of Trustees recognizes that the Trustees are active participants in the communities in which they live. As such, the Trustees may serve in many capacities with businesses, organizations, agencies and programs that may intersect with the interests of the School. While such roles may give rise to a dual interest which is beneficial to all parties, the Trustees must be sensitive to instances that may be perceived to present a conflict between the best interests of the School and the individual interests of the Trustees. Accordingly, the purpose of this Conflict of Interest Policy is to protect the interest of the School, and to assist the Trustees and executive officers in carrying out their fiduciary obligations, when the Trustees or executive officers are contemplating any arrangement that may benefit the private interest of a Trustee or an executive officer of the School. This policy is intended to supplement but not replace any applicable laws of the State of Hawaii governing conflicts of interest. 2. Definitions. Arrangement shall mean any issue, matter, contract, agreement, transaction or other arrangement with the School or in which the School has an interest. Conflict of Interest shall mean any action or proposed action by a Trustee or an executive officer with respect to an Arrangement with or involving (i) such Trustee or executive officer, (ii) the spouse of such Trustee or executive officer, or (iii) a Related Entity of such Trustee or executive officer. An Arrangement in which no action is taken or proposed to be taken by a Trustee or executive officer (i.e., transactions which are not brought before the Board of Trustees or executive officer for approval) shall not constitute a Conflict of Interest. Interested Person shall mean any Trustee or executive officer having a Conflict of Interest. Related Entity shall mean any organization in which a Trustee or executive officer, or the spouse of such Trustee or executive officer, directly or indirectly (i) owns or controls majority of the voting power or beneficial interests, or (ii) is an officer, director, trustee, partner or otherwise serves in a fiduciary capacity. 3. Conflict of Interest Procedures. (a) Duty to Disclose. An Interested Person shall promptly disclose to the Board of Trustees the existence of a Conflict of Interest known to the Interested Person and all material facts relating to the Conflict of Interest. Trustees and executive officers are encouraged to disclose any Arrangements which may not constitute an actual Conflict of Interest, but which give rise to the appearance of a Conflict of Interest. Any actual or potential Conflict of Interest may also be raised by any other member of the Board of Trustees. (b) Procedures for Addressing the Conflict of Interest. (i) An Interested Person may make a presentation to the Board of Trustees, but after such presentation, the Interested Person shall leave the meeting during the discussion of, and the vote on, the Arrangement involving the Conflict of Interest or the appearance of a Conflict of Interest. (ii) The chairperson of the Board of Trustees shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed Arrangement. The Board of Trustees shall endeavor, to the extent reasonably practical, to comply with the "rebuttable presumption of reasonableness" set forth in Internal Revenue Service Treasury Regulation 53.4958-6 when evaluating any proposed Arrangement. (iii) After exercising due diligence, the Board of Trustees shall determine whether the School is able to obtain a more advantageous arrangement with reasonable efforts from a person or entity that would not give rise to a Conflict of Interest or the appearance of a Conflict of Interest. (iv) If a more advantageous arrangement is not reasonably attainable under circumstances that would not give rise to a Conflict of Interest or the appearance of a Conflict of Interest, the Board of Trustees shall determine by a majority vote of the disinterested Trustees the Arrangement is in the School's best interest, is fair and reasonable to the School and whether to enter into the Arrangement. 4. Record of Proceedings. The minutes of the Board of Trustees shall contain: (a) The names of the persons who disclosed or otherwise were found to have a Conflict of Interest and the nature of the Conflict of Interest. (b) The names of the persons who were present for the discussion and vote relating to the Arrangement, the content of the discussion (including any action taken to determine whether the Conflict of Interest was in the School's best interest and any alternatives to the proposed Arrangement), and a record of any votes taken in connection therewith. 5. Annual Statements. Each Trustee and executive officer shall annually sign a statement which affirms that such person (i) has received a copy of the Conflict of Interest Policy, (ii) has read and understands the Policy, and (iii) agrees to comply with the Policy. COMPENSATION DETERMINATION FORM 990, PART VI, SECTION B, LINE 15A & 15B The Board appoints a Compensation Committee, comprised solely of independent trustees, none of which have a conflict of interest with respect to the compensation arrangement, to be accountable for setting reasonable compensation for each officer or key employee. The President, consistent with the organization's philosophy and principles, and based on performance goals established for the President by the Board and Compensation Committee, develops annual performance goals and criteria to be used by the Compensation Committee in determining merit increases for other officers and key employees. The President acts solely as an advisor in this process, and does not determine, or have a vote with regards to officer or key employee salaries. Appropriate comparability data is obtained from independent experts, i.e., total economic benefits paid by similarly situated organizations (both taxable and tax-exempt) for similar job responsibilities. The most recent comparability study was performed in August 2009. The Committee's written record include the (1) terms of the arrangement with the President and/or officers (including the date the arrangement was approved); (2) a list of members present during the debate on the transaction (and how the members voted when it was approved); (3) a description of the comparable data relied on by the Committee; and (4) any actions taken with respect to consideration of the transaction by members of the committee who had a conflict of interest with respect to the transaction. Key deliberations of the Committee are also documented in minutes which are approved at the next Committee meeting. INFORMATION AVAILABLE TO PUBLIC FORM 990, PART VI, SECTION C, LINE 19 While federal tax laws do not mandate that the organization's governing documents, conflict of interest policy and financial statements be made available for public inspection, the organization makes its financial statements available upon request. BUSINESS TRANSACTIONS INVOLVING INTERESTED PERSONS SCHEDULE L, PART IV, COLUMN (D) THE FOLLOWING PAYMENTS WERE MADE TO THE ORGANIZATIONS OR COMPANIES THAT THE TRUSTEES WORK FOR, ARE BOARD MEMBERS OF, OR REPRESENT AND NOT TO THE INDIVIDUALS DIRECTLY. CONSTANCE LAU: MS. LAU IS THE PRESIDENT & CHIEF EXECUTIVE OFFICER OF HAWAIIAN ELECTRIC INDUSTRIES, WHICH IS THE PARENT COMPANY OF HAWAIIAN ELECTRIC COMPANY, THE ONLY ELECTRICITY PROVIDER ON THE ISLAND OF OAHU. THE TRANSACTION REPRESENTS AMOUNTS PAID FOR ELECTRICITY SERVICES TO HAWAIIAN ELECTRIC COMPANY. JEFFREY N. WATANABE: MR. WATANABE IS THE CHAIRMAN OF HAWAIIAN ELECTRIC INDUSTRIES, WHICH IS THE PARENT COMPANY OF HAWAIIAN ELECTRIC COMPANY, THE ONLY ELECTRICITY PROVIDER ON THE ISLAND OF OAHU. THE TRANSACTION REPRESENTS AMOUNTS PAID FOR ELECTRICITY SERVICES TO HAWAIIAN ELECTRIC COMPANY. THE PAYMENTS NOTED BELOW REPRESENT COMPENSATION PAID BY THE ORGANIZATION TO FAMILY MEMBERS OF INTERESTED PERSONS FOR SERVICES RENDERED TO THE ORGANIZATION. PAYMENT AMOUNTS WERE DETERMINED BY INDIVIDUALS WITHOUT A CONFLICT OF INTEREST WITH RESPECT TO THE TRANSACTION, AND ANY INTERESTED PERSONS RECUSED THEMSELVES IN ACCORDANCE WITH THE CONFLICT OF INTEREST POLICY DISCLOSED ABOVE. JOHN D. FIELD: MR. FIELD'S SPOUSE, SUSAN FIELD, RECEIVED COMPENSATION FROM THE SCHOOL FOR SERVICES AS AN ACADEMY MATH TEACHER. MICHAEL T. WALKER: MR. WALKER'S SPOUSE, WENDY MACIAS-WALKER, RECEIVED COMPENSATION FROM THE SCHOOL FOR HER SERVICES AS A PSYCHOSOCIAL EDCUATION INSTRUCTOR. CLAIRE O. JOHNSON: MS. JOHNSON'S DAUGHTER, MARI-JO-SCHULL, RECEIVED COMPENSATION FROM THE SCHOOL FOR SERVICES AS A 4TH GRADE TEACHER.