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Elk River Fire Department Relief Association <br /> May 1,2013 <br /> M id 7M Page 3 <br /> c0 <br /> Management Consultations with Other Independent Accountants <br /> In some cases,management may decide to consult with other accountants about auditing and accounting matters,similar to obtaining <br /> a"second opinion''on certain situations.If a consultation involves application of an accounting principle to the Association's financial <br /> statements or a determination of the type of auditor's opinion that may be expressed on those statements,our professional standards <br /> require the consulting accountant to check with us to determine that the consultant has all the relevant facts.To our knowledge,there <br /> were no such consultations with other accountants. <br /> Other Audit Findings or Issues <br /> We generally discuss a variety of matters,including the application of accounting principles and auditing standards,with management <br /> each year prior to retention as the Association's auditors.However,these discussions occurred in the normal course of our <br /> professional relationship and our responses were not a condition to our retention. <br /> Financial Position and Results of Operations <br /> Our principal observations and recommendations are summarized below.These recommendations resulted from our observations <br /> made in connection with our audit of the Association's financial statements for the year ended December 31,2012. <br /> Investment Return <br /> A summary of the investment rate of return is summarized below: <br /> Assets <br /> Total Held in <br /> Investment Trust for Investment <br /> Interest Investment Appreciation Income Pension Rate of <br /> Year and Dividends Fees (Depreciation) (loss) Benefits Return <br /> 2008 $ 32,524 $ - $ (713,435) $ (680,911) $ 1,696,356 (33.1) % <br /> 2009 23,827 - 416,652 440,479 2,224,430 22.5 <br /> 2010 51,384 16,484 142,240 177,140 2,189,448 8.0 <br /> 2011 72,988 23,094 (91,141) (41,247) 2,260,830 (1.9) <br /> 2012 76,041 21,688 158,702 213,055 2,456,311 9.0 <br /> Investment Rate of Return <br /> 40.00% <br /> 30.00% <br /> 22.5% <br /> 20.00% <br /> 10.00% 8-0% 9.00/0 <br /> (10.00%) (1-90/0) <br /> (20.00%) <br /> (30.00%) <br /> (33.1%) <br /> (40.00%) <br /> (50.00%) <br /> 2008 2009 2010 2011 2012 <br /> 952.835.9090 • Fax 952.835.3261 <br /> w ww.aemcpas.coin <br />