SOCC, INC. dba
SEVEN OAKS COUNTRY CLUB
NOTES TO FINANCIAL STATEMENTS
Note 1. Nature of Activities and Significant Accounting Policies
Nature of activities: SOCC, Inc. dba Seven Oaks Country Club (the Club), currently operates as a not-for- profit organization. The Club is an exempt organization under Section 501(c)(7) of the Internal Revenue Code. It is organized as a not-for-profit mutual benefit corporation under its articles of incorporation filed with the State of California. The Club is organized for the benefit of its members who are the owners. The Club owns and operates amenities located in Bakersfield, California. The amenities consist of a golf course, restaurants and bars, swimming pools, tennis and pickleball facilities, and fitness centers. Its revenues are generated primarily from equity members and their guests who use the facility for recreation and are primarily residents of Kern County. Employee Retention Credit : The Employee Retention Credit (ERC) program was created under the Coronavirus Aid, Relief, and Economic Securities (CARES) Act and is available to employers to encourage employers to retain and continue paying employees during periods of pandemic-related reductions in business volume even if those employees are not actually working, and therefore, are not providing a service to the employer. The ERC is considered a conditional grant and has been recognized in accordance with ASU 958-605. Additionally, laws and regulations concerning governmental programs, including the ERC established by the CARES Act, are complex and subject to varying interpretations. Claims made under the CARES Act may also be subject to retroactive audit and review. There can be no assurance that regulatory authorities will not challenge the Club ’ s claim to the ERC, and it is not possible to determine the impact, if any, this would have upon the Club. The Club received revenue related to the ERC program of $1,748,312 during the year ended December 31, 2021. Subsequent to the receipt of the ERC funds the Club determined they applied for and received ERC funds they were not eligible for. The Club recorded a liability in the statement of financial position at December 31, 2021 for $587,408, the amount they expect to repay. The Club recognized revenue related to the ERC program of $1,160,904 for the year ended December 31, 2021 in the statements of activities. During the year ended December 31, 2022 the Club recorded revenue and a corresponding receivable of $600,488 for additional amounts related to the ERC program. Additionally, the Club determined they were also not entitled to an additional $78,415 increasing the ERC payable to $665,823 at December 31, 2022. The related ERC receivable and payable have been recorded in the statements of financial position and the related revenue has been recorded in the statement of activities as of and for the year ended December 31, 2022.
A summa ry of the Club’s significant accounting policies follows:
Basis of presentation: The financial statements of the Club have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”), whi ch require the Club to report information regarding its financial position and activities according to the following net asset classifications: Net assets without donor restrictions: Net assets that are not subject to donor-imposed restrictions and may be expended for any purpose in performing the primary objectives of the Club. These net assets may be used at the discretion of the C lub’s manag ement and the board of directors. Net assets with donor restrictions: Net assets subject to stipulations imposed by donors, and grantors. Some donor restrictions are temporary in nature; those restrictions will be met by actions of the Club or by the passage of time. Other donor restrictions are perpetual in nature, whereby the donor has stipulated the funds be maintained in perpetuity.
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