Page 34 - 2025 February report

Audit & Risk Committee minutes (draft)
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Minutes of Audit & Risk Committee Meeting - Zoom Thursday, January 23, 2025 @ 8:00 a.m. EST
Members Present: Hugh Brown (Chariman), Bea Awoniyi, Sherry Salway Black, David Blaikie, Bill Corwin (Bill had to drop off the meeting at 8:32),
Sanford Howard and Bobby Krause (non-voting) Others Present: Tommy Pence and Sharon Wood
Hugh chaired the meeting.
1. ApprovalofMinutesofNovember1,2024Meeting
Hugh indicated the November minutes did not include his post meeting notes for the private discussion with Templeton & Company. Also, it was noted the Chief Financial Officer’s title had inadvertently been listed as the Certified Financial Officer on page 4 of the minutes and should be corrected.
The minutes of the Committee’s November 1, 2024 meeting was approved subject to corrections referenced above.
The suggestion was made to identify the subject of items like “Note 5” to make the review of the minutes easier for Committee members going forward.
2. BusinessArisingfromtheMinutes
Hugh inquired whether the employee health insurance reimbursement matter, as part of our risk assessment project, had been resolved. Tommy indicated that he and John Chenoweth of Templeton & Company had discussed the matter at length and that they had concluded the Foundation could no longer reimburse employees for their outside health insurance premiums on a tax-free basis. The only caveat is that John believes there may be an exception in the case of reimbursing Medicare premiums.
Tommy indicated we could still assist employees with the cost of their outside health insurance premiums through compensation (after tax method). Generally, this would be accomplished by increasing their compensation for any given year.
Tommy also indicated we might need to amend payroll tax returns for 2024, subject to John’s conclusions. Buzz indicated he would recommend making this change on a going forward basis, if necessary, and not amend for 2024. Tommy agreed, but indicated the matter was a conflict of interest for him since it would impact him personally. Bobby agreed and indicated he would have a follow-up conversation with John after the Medicare matter referenced above had been resolved.
The question was asked if this matter would have an impact on our 2024 financial statements. Tommy indicated it would not impact the bottom line since we prepare our financial statements on the modified, cash basis of accounting.
Hugh inquired about what our conclusions were on the gross vs. net question regarding the presentation of our foreign currency risk in the 2023 financial statements. Tommy reported that Steve Roche of Prime Buchholz sent him an email indicating the information they provided originally, which was included in the financial statements, was on a gross basis. Further, Steve indicated there was no reportable difference between the gross and net percentage given our hedge positions.
A question was raised whether the delayed tax returns impacted our audited financial statements. Tommy indicated the only impact was to Note 3 (page 9) in our footnote disclosures. The chart refers to the cost basis of our various investment categories and this information could only be updated upon the completion of the tax returns.