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KIMLEY‐HORN AND ASSOCIATES, INC.  <br />NOTES TO THE FINANCIAL STATEMENTS  <br />  <br />DECEMBER 31, 2017 AND 2016  <br />(SEE INDEPENDENT ACCOUNTANT’S REVIEW REPORT)  <br />  <br />  <br />12 <br />Note 3—Other comprehensive income <br />  <br />The components of other comprehensive income (loss) are summarized below for the years ended <br />December 31: <br /> <br />Before‐Tax Tax  After‐Tax <br />Amount Effect Amount <br />Other comprehensive income (loss): <br />Post-retirement health benefits (79,252)$ 19,734$ (59,518)$ <br />2017 <br /> <br />Before‐Tax Tax After‐Tax <br />Amount Effect Amount <br />Other comprehensive income (loss): <br />Post-retirement health benefits 57,309$ (22,293)$ 35,016$ <br />2016 <br /> <br />See also Note 10. <br /> <br />Note 4—Litigation and claims  <br />  <br />In the normal course of business, the Company is, on occasion, named as a defendant in legal actions. The <br />Company carries professional liability insurance, subject to certain deductibles and policy limits. While <br />management does not believe that the resolution of these claims will have a material adverse effect on the <br />Company’s financial position, results of operations, or cash flows, management acknowledges the uncertainty <br />surrounding the ultimate resolution of these matters. As of December 31, 2017 and 2016, the Company has <br />recorded a liability of $1,750,000 and $1,850,000, respectively, for outstanding claims included in Accounts <br />payable – trade, which represents the best estimate of the probable loss associated with these claims. <br /> <br />Note 5—Related party transactions  <br />  <br />The Company provides management and engineering services, administrative support, benefits administration, <br />data processing, and accounting services to affiliated corporations. Included in net professional fees is $22,500 <br />for 2017 and 2016, billed for other management and administrative services. Receivable from affiliates consists <br />of $4,893,137 and $2,815,088 for 2017 and 2016, respectively, due from affiliated corporations for engineering <br />services. <br /> <br />The Company pays income taxes on behalf of APHC, Inc. and its wholly-owned subsidiaries, resulting in a tax <br />receivable or liability based on the Company’s financial results. The tax liability due to affiliates was $1,631,594 <br />and $929,714 as of December 31, 2017 and 2016, respectively.