Attachment - 1
Rev: 3/17 SSAM Financial Review Requirements Page 2 of 2
FINANCIAL REVIEW REQUIREMENTS
For SMALL SCALE
This attachment provides examples of the reporting format and content requirements for the Financial
Review Process for non-tax credit properties within the Small Scale AM portfolio. Any variation to the
format or contents of the reporting requirements detailed below requires prior approval. Contact Bob
Platte at MSDHA to request approval. The following items must be included:
Financial Review Template
Balance Sheet
Statement of Profit & Loss
Ownership Summary
Financial Review Template
The Financial Review Template is designed to extract necessary information that may not be clearly
included or easily accessible within the financial statement submission. The template is included as
Attachment 2.
Balance Sheet
The following list of accounts must be separated on the Balance Sheet:
• All partnership accounts must be separated from operating accounts
• Resident receivables
• Real Estate
• All escrow balances
• All accounts receivables/payables
Statement of Profit & Loss
This requirement can be met by submitting
any
of the following documents:
• Federal Tax Return
• Certified Audit
• Third party prepared Financial Statement
The following detail must be included:
o If a single entity owns several properties, each property must be broken out in a separate
schedule to give proper insight into each property’s financial viability.
o Additional income and expense detail must be provided if the Federal Tax Return does not
provide the necessary detail for each income or expense item listed in the budget.
o In some instances an internally prepared financial statement may be submitted in lieu of
any of the three bulleted items above with prior approval from the assigned Asset
Manager.
Ownership Summary
Attachment - 1
Rev: 3/17 SSAM Financial Review Requirements Page 2 of 2
In a separate document, each development must disclose the complete ownership entity of the
development (detail and example below).
Ownership Percentages
o The names of all general partners and their percentage of ownership
o The names of all limited partners with ownership interest equal to or greater than 25%
o The names of all Board Members’ positions and terms for those developments organized as a
non-profit corporation.
Example
The General/Limited Partners of the Partnership are:
Managing General Partner - James Jones .45%
General Partner - Ben Brown .55%
Limited Partner - Sam Smith 99%
Attachment - 1
Rev: 3/17 SSAM Financial Review Requirements Page 2 of 2
FINANCIAL REVIEW REQUIREMENTS
For SMALL SCALE with NSP2
This attachment provides examples of the reporting format and content requirements for the Financial
Review Process for non-tax credit properties within the Small Scale AM portfolio. Any variation to the
format or contents of the reporting requirements detailed below requires prior approval. Contact Bob
Platte at MSDHA to request approval. The following items must be included:
All NSP2 Projects:
Financial Review Template
Balance Sheet
Statement of Profit & Loss
Ownership Summary
Identity of Interest
Financial Review Template
The Financial Review Template is designed to extract necessary information that may not be clearly
included or easily accessible within the financial statement submission. The template is included as
Attachment 2.
Balance Sheet
The following list of accounts must be separated on the Balance sheet:
• All partnership accounts must be separated from operating accounts
• Resident receivables
• Real Estate
• All escrow balances
• All accounts receivables/payables
Statement of Profit & Loss
This requirement can be met by submitting
either
of the following documents:
• Certified Audit
• Third party prepared Financial Statement
The following detail must be included:
o If a single entity owns several properties, each property must be broken out in a separate
schedule to give proper insight into each property’s financial viability.
Ownership Summary
If not disclosed within the Financial Statements, in a separate document each development must:
• Disclose the complete ownership entity of the development (detail and example below).
Attachment - 1
Rev: 3/17 SSAM Financial Review Requirements Page 2 of 2
• Disclose any Sale, Transfer or Conveyance of Interests in Ownership.
• Disclose any Sale or Transfer of the Project.
Ownership Percentages
o The names of all general partners and their percentage of ownership
o The names of all limited partners with ownership interest equal to or greater than 25%
o The names of all Board Members’ positions and terms for those developments organized as a
non-profit corporation.
Example
The General/Limited Partners of the Partnership are:
Managing General Partner - James Jones .45%
General Partner - Ben Brown .55%
Limited Partner - Sam Smith 99%
Identity of Interest
All Identity of Interest relationships must be declared. An identity of interest relationship exists if any
officer, director, board member, or authorized agent of any project team member:
• Is also an officer, director, board member or authorized agent of any other project team member
• Has any control over or any financial interest in any other project team member’s firm or
corporation
• Is a business partner of an officer, director, board member, or authorized agent of any other
project team member board member, or authorized agent
• Has any family relationship through blood, marriage or adoption with an officer, director, board
member, or authorized agent of any project team member
• Advances any funds or items of value to the Owner
All Identity of Interest relationships must be disclosed on Attachment 4 – Identity of Interest Declaration
Form.
NSP2 Projects developed
directly
by a state or local Land Bank authority:
NSP2 projects developed directly by a state or local Land Bank authority must also submit the Excess Cash
calculation. The Excess Cash Calculation Template can be found in Attachment 3.
Excess Cash Calculation
A calculation of Excess Cash must be included within the Financial Review packet. Excess Cash shall be
defined as any cash remaining at the end of each fiscal year after:
• Payment of all MSHDA approved operating expenses (MSHDA approved operating expenses are
those included within the original pro-forma).
• Payment of all sums due or required to be paid under the terms of any MSHDA approved
permanent loan mortgage encumbering the Project and the note secured by such mortgage.
• Payment of all amounts required to be deposited into any reserve for replacements to the project
including the Replacement Reserve.
Attachment - 2
Rev: 3/17
Development Name:
Ownership Entity:
Management Company:
Replacement Reserve Balance: $ Operating Reserve Balance: $
Tax & Insurance Escrow Balance: $ Other Reserve Balance: $
Operating Cash: $ Total Vacant Units for the Year:
Total Accounts Payable:
$
Total Accounts Receivable: $
Identity of Interest Payables: $ Subsidy Receivable: $
0 - 30 Days $ 0 - 30 Days $
31 - 60 Days $ 31 - 60 Days $
61 - 90 Days $ 61 - 90 Days $
91 + Days $ 91 + Days $
Total Rental Income: $ Administrative Expense: $
Annual Vacancy Loss: $ Utilities: $
Loss to Lease:
$ Operating & Maintenance:
$
Management Fee: $ Property Taxes: $
Interest Expense: $ Insurance Expense: $
I, , certify
Signature Date
Accounts Payable
Accounts Receivable
Profit & Loss Items
SSAM Financial Review Template
2016 Review
Balance Sheet Items
all of the financial information provided on this template and in the supporting documentation is accurate
to the best of my knowledge.
Print Name
Attachment - 3
Rev: 3/17
Name of Related
Party
Relationship
Brief Description
of Services
Performed
Transaction
Amount
Terms of
Settlement
Identity of Interest Declaration Form
Neighborhood Stabilization Program
FY 2016
Attachment - 4
Rev: 3/17
Development Name
Year
Date
Income
Gross Rent Potential: $1,234,567
Non Rental Income: $0
$1,234,567
Part A
Vacancy Loss
$0
Management Fee
$0
Administration
$0
Project-paid Fuel
$0
Common Electricity
$0
Water and Sewer
$0
Operating and Maintenance
$0
Real Estae Taxes or PILOT
$0
Insurance
$0
Grounds
$0
Asset Management Fee (Kalamazoo Land Bank)
$0
$0
Part B
$0
Part C
$0
$0
$1,234,567
Total Deductions:
Total Project Revenue:
Excess Cash Due to Authority:
Excess Cash Calculation
Total Approved Operating Expenses:
Authority Debt Service:
Replacement Reserve Contributions: