NATIONAL OILHEAT RESEARCH ALLIANCE, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2017 AND 2016
NOTE 1 - THE ORGANIZATION
The National Oilheat Research Alliance, Inc. (the Alliance) is a non-profit trade organization developed under the
National Oilheat Research Alliance Act of 2000 (NORA), Public Law 106-469, legislation passed by the United States
Congress and signed into law in November 2000. The law was amended in 2014 under NORA Public Law 113-79. The
Alliance was created to educate consumers about the benefits of oilheat, to perform research and development, to
encourage heating oil efficiency and upgrades, and to provide technical training to provide better customer service. The
Alliance’s Board consists of members from the oilheat industry, retail markets, wholesale distributors, public members,
and representatives from the states with the highest oilheat sales. The Alliance was incorporated on January 31, 2001.
Funding under the NORA Public Law 106-469 ceased on February 6, 2010. On February 7, 2014, the NORA Public
Law 113-79 extended the provisions of NORA Public Law 106-469 to February 6, 2019. Funding under NORA Public
Law 113-79 resumed effective April 1, 2014.
Pursuant to NORA Public Law 113-79, Congress established a limit on the use of assessments revenue of 30 percent for
consumer education, safety, and training; a minimum of at least 30 percent of assessments revenue for research,
development, and demonstration; a minimum of at least 15 percent of assessments revenue for heating oil efficiency and
upgrade; and a limit on the use of assessments revenue of 5 percent for administrative costs. In the years ended
December 31, 2017 and 2016, the Alliance was in compliance with these percentages.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The financial statements have been prepared on the accrual basis of accounting following the Financial Accounting
Standards Board (FASB) Accounting Standards Codification (ASC), which is the sole source of authoritative accounting
principles generally accepted in the United States of America (GAAP). The Alliance reports information regarding its
financial position and activities according to three classes of net assets: unrestricted, temporarily restricted, and
permanently restricted.
Accounting Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and
assumptions that could affect certain reported amounts of assets, liabilities, revenue, and expenses, the disclosure of
contingent assets and liabilities at the date of the financial statements, and functional allocations during the year. Actual
results could differ from those estimates.
Property and Equipment
Property and equipment purchased in excess of $1,000 are recorded at cost. Depreciation and amortization of furniture,
equipment, website development costs, and computers is computed by using the straight-line method over the estimated
useful lives of the assets. Estimated useful lives by category are three to five years for furniture, equipment, and
computers and five years for website development costs.
Assessments Receivable
An estimate of assessments to be received, but not remitted to the Alliance as of year-end, is recognized. Receivables
are charged to bad debt expense as they are deemed uncollectible based upon a periodic review of the accounts. As of
December 31, 2017 and 2016, no allowance for uncollectible accounts was considered necessary by management.
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