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Premier: Report Of Independent Auditors Consolidated Balance Sheet

The following excerpt is from the company's SEC filing.

Consolidated Statement of Loss

Consolidated Statement of Changes in Stockholders Deficit

Consolidated Statement of Cash Flows

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

7 17

Report of Independent Auditors

To the Board of Directors and Shareholders of Premier, Inc.

We have audited the accompanying consolidated financial statements of CECity.com, Inc., which comprise the consolidated balance sheet as of December 31, 2014, and the related consolidated statements of loss, changes in stockholders deficit and cash flows for the year then ended, and the related n otes to the financial statements.

Managements Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in conformity with U.S. generally accepted accounting principles; this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error.

Auditors Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entitys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of CECity.com, Inc. at December 31, 2014, and the consolidated results of its operations and its cash flows for the year then ended in conformity with U.S. generally accepted accounting principles.

/s/ Ernst & Young LLP

Charlotte, North Carolina

November 5, 2015

CECITY.COM, INC

Consolidated Balance Sheet

December 31, 2014

Assets

1,713,977

Accounts receivable (net of $106,767 allowance for doubtful accounts)

2,414,237

Employee advances

Prepaid expenses

259,982

Total Current Assets

4,390,608

Property and equipment, net

321,169

Intangible assets, net

32,406

Total Assets

4,744,183

Current Liabilities

Accounts payable

671,420

Accrued expenses and other payables

601,211

Shareholder revolving demand note

1,195,000

Capital lease payable, current portion

73,217

Deferred revenue, current portion

5,410,789

Total Current Liabilities

7,951,637

Capital lease payable, net of current portion

45,039

Deferred revenue, net of current portion

2,430,622

Total Liabilities

10,427,298

Common stock; par value $0.01 per share; 100,000 shares authorized

Class A voting common stock, 100 shares issued and outstanding

Class B nonvoting common stock, 9,900 shares issued and outstanding

Paid in excess of par value

Retained deficit

(5,683,315

Total Stockholders Deficit

(5,683,115

Total Liabilities and Stockholders Deficit

See accompanying notes to the consolidated financial statements.

CECITY.COM, INC.

Consolidated Statement of Loss

For the Year Ended

Revenue

14,041,174

Cost of revenue

7,739,947

Gross Profit

6,301,227

Operating Expenses:

Selling general and administrative

7,051,138

Amortization of purchased intangible assets

Total Operating Expenses

7,054,284

Operating Loss

(753,057

Other Income (Expense)

Loss from equity method investment

(2,532

Interest income

Interest expense

(6,218

Total Other Loss

(3,018

Net Loss

(756,075

Consolidated Statement of Changes in Stockholders Deficit

Voting

Nonvoting

Paid in

Excess of

Par Value

Retained Deficit

Balance at December 31, 2013

(4,927,240

(4,927,040

Net loss

Balance at December 31, 2014

Consolidated Statement of Cash Flows

Cash flows from operating activities

Adjustments to reconcile net loss to net cash provided by operating activities

Provision for doubtful accounts

155,082

Depreciation

103,966

Amortization of intangible assets

Write-off of intangible assets

Changes in:

Receivables

(208,448

(97,710

148,668

168,805

1,787,959

Net cash provided by operating activities

1,309,314

Cash flows from investing activities:

Purchase of equipment

(31,419

Payments received on note receivable

93,691

Net cash provided by investing activities

62,272

Cash flows from financing activities:

Payments on capital lease payable

(77,397

Net cash used in financing activities

Net increase in cash

1,294,189

Cash balance, beginning of period

419,788

Cash balance, end of period

Supplemental Disclosure of Cash Flow Information:

Cash payments for Interest

Supplemental Disclosure of Non-Cash Investing Activities

Equipment financed by capital lease

(63,246

Notes to the Consolidated Financial Statements

Note 1 Summary of significant accounting policies

Description of Business

CECity.com, Inc. (CECity or the Corporation) is a leading enterprise healthcare technology Corporation that combines its (patent-pending) cloud-based clinical data registry, performance measurement, advanced data analytics, qualified value-based reporting and data-driven learning management platforms with a broad network of strategic partners for data, distribution, education and quality improvement content, to achieve meaningful clinical, quality and financial improvement outcomes for key stakeholders across the healthcare paradigm.

CECitys platforms, programs, and related applications are made accessible to clients and related healthcare professionals and patients either through (i) private branded web portals (ii) neutrally branded, multi-tenant portals or (iii) via a data feed to provide CECity information or content via third party platforms. CECity provides access to its cloud platforms, programs, and related applications via a Software as a Service (SaaS) model which provides recurring revenue to the Corporation.

CECity also provides professional services (e.g. implementation, content acquisition and conversion, and platform customizations) in support of customers related to the hosting and support of the CECity platforms. These services are offered on a time and materials basis.

CECity customers include stakeholders directly involved in the delivery of care (e.g. health systems, Integrated Delivery Networks, academic medical centers, Accountable Care Organizations (ACOs), pharmacies, individual healthcare professionals and provider networks); payers of healthcare delivery (e.g. national commercial health plans and Center for Medicare and Medicaid Services (CMS)); regulators (e.g. medical specialty boards); professional associations (e.g. medical specialty societies); and life science companies (e.g. pharmaceutical manufacturers).

Basis of Presentation and Consolidation

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP). Accordingly, the financial statements reflect all adjustments that, in the opinion of management, are necessary for a fair presentation of results of operations and financial condition for the periods shown, including normal recurring adjustments. There are no elements of other comprehensive income.

Use of Estimates

The preparation of the Corporations financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. Estimates are evaluated on an ongoing basis, including allowances for doubtful accounts, useful lives of property and equipment, and other contingencies. These estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Cash includes cash only as the Corporation does not have liquid investments.

Accounts Receivable

Receivables consist of amounts due from services provided to customers. All accounts receivable are reported net of an allowance for doubtful accounts. Accounts receivable are trade accounts created in the normal course of the Corporations business. Receivables arising from sales are not collateralized.

The Corporation maintains an allowance for doubtful accounts. This allowance is an estimate and is regularly evaluated by the Corporation for adequacy by taking into consideration factors such as past experience, credit quality and age of receivable balance. Accounts deemed uncollectible are written off, net of actual recoveries.

An allowance for doubtful accounts is established for all or any portion of an account where collections are considered to be at risk. Reserves are evaluated no less than annually to determine their adequacy. The provision for doubtful accounts is recorded in selling, general and administrative expenses in the Statement of Loss.

Judgments relative to at-risk accounts include the customers current financial condition, historical business relationships with the Corporation and current projected economic conditions. Accounts receivable are written off when the account is deemed uncollectible.

The Corporation has...


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