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OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITY

AUDITED FINANCIAL STATEMENTS

JUNE 30, 2007

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OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITY

JUNE 30, 2007

TABLE OF CONTENTS

Page

INDEPENDENT AUDITOR'S REPORT 1-2 MANAGEMENT’S DISCUSSION AND ANALYSIS 3-11 BASIC FINANCIAL STATEMENTS

Government-wide Financial Statements Statement of Net Assets 12 Statement of Activities 13 Fund Financial Statements Balance Sheet – Governmental Funds 14 Statement of Revenues, Expenditures and Changes in Fund Balances– Governmental Funds 15 Statement of Revenues and Expenditures (Budgetary Basis) – Budget and Actual 16-17 Notes to the Financial Statements 18-35 INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

36-37 FINDINGS AND RECOMMENDATIONS 38 STATUS OF PRIOR YEAR FINDINGS 39

MANAGEMENT’S DISCUSSION AND ANALYSIS

As management of the Oakland-Alameda County Coliseum Authority (Authority), we offer readers of the Authority’s financial statements this narrative overview and analysis of the financial activities of the Authority for the fiscal year ended June 30, 2007. All amounts in this discussion and analysis, unless otherwise indicated, are expressed in thousands of dollars.

Financial Highlights

• The assets of the Authority exceeded its liabilities at the close of the most recent fiscal year by $43,097. Of this amount, $20,893 represent assets associated with long-term debt that are subject to external restrictions as to how they may be used, $25,703 needs to be raised in order to meet excess of debt related to capital assets over the amount invested in those capital assets and $47,908 may be used to meet the Authority’s ongoing obligations to citizens and creditors.

• The total net assets increased by $2,826 during the fiscal year. This is attributable to revenues

exceeding expenditures. Current year operating revenue increased because of certain new components in the Authority's revenue including the Arena naming rights, the Golden State Warriors (Warriors) rent, the concession revenue from Warriors games and the net parking revenue from football games. The increased interest earnings produced sufficient savings to offset the decreased football revenues. Expenditures increased primarily due to higher interest rates on the Authority's variable rate bonds and the additional operating subsidy to the Oakland Coliseum Joint Venture (OCJV). A decrease in legal costs offset the playoff expenses for the Oakland Athletics (Athletics) and the Warriors.

• As of June 30, 2007, the Authority’s governmental funds reported an ending fund balance of

$113,781. This fund balance is available to pay the Authority’s long-term debt in future periods.

• At the close of the fiscal year, unreserved fund balance for the general fund was a negative $174,966, as this amount will be used to pay existing debt. The total net fund balance in the General Fund as of June 30, 2007 was $28,988 or 130 percent of total general fund expenditures of $22,218.

• The Authority’s long-term debt decreased by $8,500 or 3 percent during the fiscal year ended June

30, 2007. The change was due to pay down of existing debt without issuing any new debt.

Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the basic financial statements. The Authority’s basic financial statements are comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. Government-wide financial statements The government-wide financial statements are designed to provide readers with a broad overview of the finances, in a manner similar to private-sector business.

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The statement of net assets presents information on all of the assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the Authority is improving or deteriorating. The statement of activities presents information showing how the Authority’s net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods, such as revenues related to uncollected interest earnings and incurred but unpaid legal cost. Both of the government-wide statements reflect the Authority’s intent to generate revenues to recover a significant portion of their related costs through user fees and charges, similar to a business-type activity. The government-wide financial statements are located on pages 12 through 13 of this report. Fund financial statements A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The Authority, like state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the Authority are considered governmental funds. Governmental funds Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. These statements, however, focus on (1) how cash and other financial assets can readily be converted to available resources and (2) the balances left at year-end that are available for spending. Such information may be useful in evaluating a government’s near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The Authority maintains several individual funds organized according to their type (special revenue, debt service and general fund). Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the general fund, special revenue fund, and debt service fund, all of which are considered major funds. The basic governmental fund financial statements can be found on pages 14 through 15 of this report.

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Notes to the financial statements The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 18 through 35 of this report.

Government-wide Financial Analysis Analysis of net assets As noted earlier, net assets may serve over time as a useful indicator of a government’s financial position. In the case of the Authority, assets exceed liabilities by $43,097 at June 30, 2007. The Authority's outstanding debt related to its capital assets (e.g. property, building improvements, equipment and infrastructure), is greater than the net value of those assets by $25,703. The Authority uses these capital assets to provide facilities for sports activities for local citizens at the Coliseum Complex. These assets are not available for future spending. Although the Authority’s investments in its capital assets are reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

Statement of Net Assets

Governmental Activities

2007

2006

Assets: Current and other assets $ 155,974 $ 154,008 Capital assets 174,872 182,084 Total assets 330,846 336,093 Liabilities: Long-term liabilities 277,139 285,863 Other liabilities 10,610 9,959 Total liabilities 287,749 295,822 Net assets: Invested in capital assets, net of related debt (deficit) (25,703) (23,590) Assets associated with bonded debt 20,893 32,302 Unrestricted 47,907 31,559 Total net assets $ 43,097 $ 40,271

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Approximately $47,907 of these net assets may be used to meet the ongoing obligations of the Authority. An additional portion of the Authority’s net assets, $20,893, represents resources that are subject to external restrictions as to how they may be used. Approximately $25,703 of the net assets is consumed by an unrestricted net deficit. This means that the value of the Authority’s net assets is less than the debt used to acquire those assets. Analysis of changes in net assets The Authority’s net assets increased by $2,826 during the fiscal year ended June 30, 2007. This increase is explained in the governmental activities discussion below and is primarily a result of current year revenues exceeding expenses.

Authority’s Changes in Net Assets

Governmental Activities

2007 2006 Revenues: Program revenues: Charges for services:

PSL, Club fees & Suite deposits $ $ 21 Club Dues 898 Parking & Concession 1,360 Arena facility fees 2,757 2,663 Premium Seating Revenue 7,428 7,428 Location Premium Fees $ 12,443 1,138 $ 11,250

Operating subsidy 22,300 22,300 Lease revenue 2,075 580 Interest income 8,885 7,602 Other revenue 2,859 2,267

Total revenues 48,562 43,999 Expenses:

Administrative and operating expenses 29,295 26,239 Debt financing cost 16,441 13,485

Total expenses 45,736 39,724

Increase/(decrease) in net assets 2,826 4,275 Net assets – beginning 40,271 35,996

Net assets – ending $ 43,097 $ 40,271

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Governmental Activities: The activities of the Authority increased its net assets by $2,826. Key elements of this increase are as follows: • Football revenues from the sales of personal seat licenses (PSLs), club fees, suite deposits and location

premium fees decreased $1,159 or 100 percent during the year. This decrease is the result of no remarketing of PSLs, no other charges incident to the ownership of PSLs and no location premium fee after the 2005 football season. This change resulted from the settlement agreement between the East Bay Entities and the Oakland Raiders (Raiders). However, beginning in 2006, the Authority is entitled to receive one half of the club dues, one half of the concession revenues and all of the parking revenues from football games. During the fiscal year 2006-07, the Authority received $898 club dues, $176 net football concession revenues and $227 net football parking revenues.

• The Authority retained the Arena concession and parking revenues from Warriors’ games during the

fiscal year 2006-07. After the deduction of the related expenses, the Authority received $1,046 Arena concession revenue. Conversely, the Arena parking expenses from Warriors’ games were $89 over the Authority's share of revenue.

• Revenue from Arena Facility Fees increased $94 or 4 percent over the previous year. This increase is

the result of ticket sales from the Warriors basketball playoff games during the 2006 season; however, the facility fee from other events decreased $247 or 40 percent.

• Lease revenue increased by $1,495 or 258 percent because the $1,500 Warriors rent was paid directly

to the Authority. There was a slight decrease of $5 or 1 percent in Athletics rent due to no revenue from excess paid attendance in the 2006 regular season.

• Interest income increased by $1,283 or 15 percent. This increase was due to the increasing trend in

market interest yields and the interest earnings on past due receivables from the Warriors. Of the $8,885 interest income, $6,078 represents interest on loans to the Raiders. The interest on the original loans totaling $63,900 is calculated at a fixed rate of 6.07 percent, and is compounded on an annual basis on September 12 and added to the principal.

• Other revenue increased $592 or 26 percent. The increase primarily comes from the first time revenue

of Oracle Arena naming rights. • Administrative and operating expenses increased by $3,056 or 12 percent. The major reason for this

increase is the additional operating subsidy to OCJV. As the result of the termination agreement between the Coliseum, Inc. and the Authority, certain revenues that OCJV formerly collected, now directly collected by the Authority. This requires the Authority to increase the subsidy to cover the reduced operating revenues that in the past had been directly paid to OCJV. During the fiscal year 2006-07, the Authority subsidized additional $3,309 to OCJV as a result of the transfer of this revenue which includes $525 Raiders rent, $1,500 Warriors rent, $1,046 Arena Concession revenue and $238 Warriors parking revenue. The most significant operating expense increases include the Warriors’ and Athletics’ playoff expenses of $843, which were offset by the decreases of $322 or 77 percent legal costs and marketing expenses of $657 or 93 percent.

• Total debt service financing costs increased $2,956 or 22 percent due to current year interest rates on

the Authority’s variable rate bonds being higher than the prior year.

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Financial Analysis of the Authority’s Funds

As noted earlier, the Authority uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Governmental funds The focus of the Authority’s governmental funds is to provide information on near-term inflows, outflows, and balances of resources that are available for spending. Such information is useful in assessing the Authority’s financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. Types of governmental funds reported by the Authority include the general fund, special revenue funds, and debt service funds. At the end of the fiscal year, the Authority’s governmental funds reported combined ending fund balances of $113,781, a decrease of $2,455 or 2 percent in comparison with the beginning fund balances. This fund balance will be applied 1) to liquidate existing contracts and commitments ($147); and 2) to reduce the bonded indebtedness of the Authority ($113,634). Revenues for governmental funds overall totaled approximately $44,392 in the fiscal year ended June 30, 2007, which represents an increase of 12 percent from the fiscal year ended June 30, 2006. Expenditures for governmental funds, totaling $46,847, increased by $5,672 or 14 percent from the fiscal year ended June 30, 2006. In the fiscal year ended June 30, 2007, expenditures for governmental funds exceeded revenues by approximately $2,455, or about 6 percent. The general fund is the chief operating fund of the Authority. At the end of the current fiscal year, the fund balance of the general fund was $28,988. As a measure of the general fund's liquidity, it may be useful to compare total fund balance to total fund expenditures. Total fund balance represents 130 percent of general fund expenditures. The fund balance in the Authority’s general fund increased by $8,954 during the fiscal year, this was mainly due to a decrease in funds transferred to the Trustee. The Authority reserved excess funds in the Trustee's account for debt payments. General fund budgetary highlights The Authority's final budget differs from the original budget in that it contains supplemental adjustments approved during the fiscal year. The Authority adjusted appropriations in the amount of $112 by moving funds from budgeted legal costs to cover capital expenditures not specifically planned at the start of the fiscal year. Overall, the Authority's actual general fund revenues exceeded its budgeted fiscal year 2006-07 revenues by $1,822 or 5 percent. Similarly, actual general fund expenditures exceeded the adjusted budget by $3,048 or 16 percent. In general, the increased revenue primarily reflects a large increase in interest earning due to the increasing trend in market interest yields and the past-due interest from the Warriors’ receivable. The increased expenditures reflect additional operating subsidy to OCJV as well as the unbudgeted playoff expenses.

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Capital assets and debt administration Capital Assets The Authority’s capital assets as of June 30, 2007 amount to $174,872 (net of accumulated depreciation) as shown in the table below. This investment in capital assets includes property, building improvements, machinery and equipment. The total decrease in the Authority’s capital assets for the current fiscal year, net of depreciation, was 4 percent. The decrease in capital assets is due to the depreciation on current assets being greater than capital additions.

Capital Assets, Net of Accumulated Depreciation

Governmental Activities 2007 2006 Construction in progress $ $ 398 Arena improvement 78,908 82,096 Stadium improvement 88,604 92,401 Property improvement 1,573 1,230 Machinery and equipment 3,985 4,091 Furniture and fixtures 1,601 1,643 Vehicles 201 225

Total $ 174,872 $ 182,084 Major capital asset events during the current fiscal year included the following: During the year, the Authority added $1,369 to its capital assets, through purchase and construction. Major acquisitions are as follows: • 500 Ton Chiller $343 • 700 Chiller Compressor $85 • Parking Lot Improvement and signage $507 • Video Control Room Equipment $150 • Other machinery and equipment $168 • Other furniture and fixtures $116 For government-wide statement of net assets presentation, the Authority depreciated all depreciable capital assets from acquisition date to the end of the current fiscal year. Fund financial statements record capital asset purchases as expenditures. Additional information about the Authority’s capital assets can be found in Note 6 to the financial statements.

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Debt Administration At the end of the current fiscal year, the Authority had total long-term obligations outstanding of $288,600. This entire amount is secured by letters of credit and is payable from revenues of the Authority. The unamortized bond issuance costs are $2,561 as of June 30, 2007.

Outstanding Long-term Obligations Governmental Activities

2007

2006

Revenue Bonds: Stadium variable rate refunding lease revenue refunding bonds $ 170,700 $ 176,200 Arena variable rate lease revenue bonds 117,900 120,900

Total $ 288,600 $ 297,100 During the fiscal year 2006-07, the Authority’s total bonded debt decreased by $8,500. The decrease was due to the pay down of existing debt. The Authority did not add any additional debt issues during the year. Additional information about the Authority's long-term obligations is located in Note 9 to the financial statements. Economic factors and next year's budget and rates

• The federal fund interest rates stayed at approximately 5.25 percent throughout the fiscal year 2006-07. At the start of fiscal year 2007-08, interest rates remained at the same level as at June 2007. On September 18 2007, The Federal Reserve policymakers lowered the interest rates from 5.25 percent to 4.75 percent and signaled that they are in no hurry to reduce interest rates again because they are not convinced the U.S. economic expansion is ending. Economic activity appears poised to expand at a moderate rate in the second half of 2007, and it should strengthen gradually into 2008. The ongoing correction in the housing market seems likely to continue and will influence the rate of economic expansion over the near term.

• Core inflation is expected to moderate a bit further over the next year. Long-run inflation

expectations are contained, pressures on resource utilization should ease slightly in an environment of economic expansion at or just below the rate of increase in the nation's potential to produce, and some of the other factors that boosted inflation in recent years have already receded or seem likely to do so.

• The unemployment rate of Alameda County was 4.7 percent in June 2007. This is favorable as

compared to the statewide unemployment rate of 5.2 percent. The unemployment rates of Alameda County were 4.5 percent and 4.9 percent as in June 2006 and 2005 respectively.

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• Job growth in the first half of 2007 was driven by sizable increases in service-producing industries,

growth in labor productivity appears to have remained modest. The residential construction will likely restrain overall activity for a while longer, but as stocks of unsold new homes are brought down to more comfortable levels, that restraint should begin to abate. Employment and real wages are on track to rise further, and, although the difficulties in the sub prime-mortgage market have created severe financial problems for some individuals and families, the household sector is in good financial shape overall. Consumer spending should also keep moving up. The County average salaries adjusted for inflation is currently well above the California average, and will remain so over the near future. This may have an impact on discretionary spending income for individuals who buy tickets for concerts and sports events.

All of the above factors were considered in preparing the Authority's budget for fiscal year 2007-08.

Requests for Information This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the Authority's finances and to demonstrate the Authority's accountability for the money it receives. Below is the contact for questions about this report or requests for additional financial information.

Oakland-Alameda County Coliseum Authority

Office of the Auditor-Controller 1221 Oak Street, Room 249

Oakland, CA 94612

GOVERNMENTALACTIVITIES

ASSETS

Current assets:

Cash and investments (Note 3) $ 27,074,993 Cash and investments - restricted (Note 3) 20,892,717 Accounts receivable (Note 4) 1,768,174 Raiders loans receivable (Note 5) 104,383,463 Prepaid expenses 367,157 Due from OCJV - Stadium 1,487,816

Total current assets 155,974,320

Noncurrent assets:

Capital assets (net of accumulated depreciation) (Note 6) 174,871,784

Total noncurrent assets 174,871,784

Total assets $ 330,846,104

LIABILITIES

Current liabilities:

Accounts payable (Note 7) $ 1,142,145 Due to OCJV - Arena 567,538 Bonds payable - current (Note 9) 8,900,000

Total current liabilities 10,609,683

Noncurrent liabilities

Bonds payable (net of unamortized bond issuance cost) (Note 9) 277,139,167

Total noncurrent liabilities 277,139,167

Total liabilities 287,748,850

NET ASSETS

Investment in capital assets, net of related debt (25,703,342) Restricted for debt service 20,892,717 Unrestricted 47,907,879

Total net assets 43,097,254

Total liabilities and net assets $ 330,846,104

The net assets total reported in this statement differs from the governmental funds balance sheet due to the following reconciling items

Total net assets $ 43,097,254

As the focus of governmental fund is on short-term financing, some assets will not be available to pay current expenditures. Those assets (receivables) are offset by deferred revenue in the governmental funds and they are not included in fund balances (40,483,463)

Capital assets used in governmental activities are not financial resources and thereforeare not reported in the funds (174,871,784)

Bond issuance cost are reported as deferred charges in government wide statement of netassets while these expenditures were recognized as expenditures in the year of issuance inthe governmental funds. These bond issuance costs are amortized over the life of the bonds (2,560,833)

Long-term liabilities, including bonds payable, are not due and payable in the currentperiod and therefore, are not reported in the funds 288,600,000

Fund balance per governmental funds balance sheet $ 113,781,174

The accompanying notes are an integral part of these financial statements

OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITYSTATEMENT OF NET ASSETS

JUNE 30, 2007

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TotalCharges Operating Lease Interest Other Changes in

Functions/Programs Expenses for Services Subsidy Revenue Income Revenue Net Assets

Governmental activities:

General government $ 29,295,641 $ 12,443,330 $ 22,300,000 $ 2,075,000 $ $ 2,859,149 $ 10,381,838 Interest on long-term debt 16,440,729 8,885,144 (7,555,585)

Total Governmental activities $ 45,736,370 $ 12,443,330 $ 22,300,000 $ 2,075,000 $ 8,885,144 $ 2,859,149 2,826,253

Net Assets - Beginning 40,271,001

Net Assets Ending $ 43,097,254

The changes to net assets reported in this statement differ from the governmental funds statement of revenues, expenditures and changes in fund balances due to the following reconciling items:

Net change in net assets per statement of activities $ 2,826,253

Debt service expenditures for principal payments - recognized as an expenditure in the governmental funds statement of revenues, expenditures and changes in fund balances (8,500,000)

Acquisition of capital assets - recognized as an expenditure in the governmental fund statement of revenues, expenditures and changes in fund balances (971,882)

Amortization of bond issuance cost - recognized as an expense in the government-wide statement of activities 176,491

Depreciation of capital assets - recognized as an expense in the government-wide statement of activities 8,184,400

Interest on Raiders loans which was not received within the available period established for the governmental funds is not reported as revenue in the funds. (4,170,580)

Total revenues over expenditures per statement of revenues, expenditures and changes in fund balances $ (2,455,318)

The accompanying notes are an integral part of these financial statements

OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITYSTATEMENT OF ACTIVITIES

FOR THE YEAR ENDED JUNE 30, 2007

JPA Revenues

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OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITY

TOTALSSPECIAL DEBT (MEMORANDUM

GENERAL REVENUE SERVICE ONLY)

ASSETSCash and investments (Note 3) $ 27,074,993 $ $ $ 27,074,993 Cash and investments - restricted (Note 3) 20,892,717 20,892,717 Accounts receivable (Note 4) 1,768,174 1,768,174 Raiders loans receivable (Note 5) 104,383,463 104,383,463 Prepaid expenses 367,157 367,157 Due from OCJV - Stadium 1,487,816 1,487,816

Total assets $ 30,698,140 $ 104,383,463 $ 20,892,717 $ 155,974,320

LIABILITIES AND FUND BALANCES

LIABILITIESAccounts payable (Note 7) $ 1,142,145 $ $ $ 1,142,145 Due to OCJV - Arena 567,538 567,538 Deferred revenue (Note 8) 40,483,463 40,483,463

Total liabilities 1,709,683 40,483,463 42,193,146

FUND BALANCESReserved for: Debt service 203,807,283 63,900,000 20,892,717 288,600,000 Encumbrances (Note 10) 147,313 147,313 Unreserved (174,966,139) (174,966,139)

Total fund balances 28,988,457 63,900,000 20,892,717 113,781,174

Total liabilities and fund balances $ 30,698,140 $ 104,383,463 $ 20,892,717 $ 155,974,320

BALANCE SHEETGOVERNMENTAL FUNDS

JUNE 30, 2007

The accompanying notes are an integral part of these financial statements.

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TOTALSSPECIAL DEBT (MEMORANDUM)

GENERAL REVENUE SERVICE ONLY)REVENUES:

Club dues $ 898,359 $ $ $ 898,359 Parking & concessions 1,360,120 1,360,120 Arena facility fees 2,756,851 2,756,851 Premium seating revenue 7,428,000 7,428,000 Unrealized gain/(loss) on investment 119,841 119,841 Interest earned Arena 777,207 476,739 1,253,946 Stadium 561,602 1,878,104 901,071 3,340,777 Naming rights 1,335,679 1,335,679 Subsidy to authority 22,300,000 22,300,000 Athletics rent 575,000 575,000 Warriors rent 1,500,000 1,500,000 CBS/Viacom revenue 1,516,592 1,516,592 Miscellaneous revenue 6,878 6,878

Total revenues 41,016,288 1,878,104 1,497,651 44,392,043

EXPENDITURES:Administrative expenses:

Legal and accounting fees 157,888 157,888 OACC Inc. expenses 260,597 260,597 Miscellaneous admin. expenses 448,746 448,746

Total administrative expenses 867,231 867,231

Operating expenses:Day of game 3,206,750 3,206,750 Marketing expense - OFMA and others (Note 11a) 47,710 47,710 Marketing expense - Warriors 675,000 675,000 Playoff expenses - Athletics and Warriors 842,595 842,595 Commercial property insurance 427,058 427,058 Incentive fee - SMG/OCJV 656,894 656,894 Coliseum JV. - subsidy - operations 12,667,259 12,667,259 Coliseum JV. - capital 2,692,626 2,692,626

Total operating expenses 21,215,892 21,215,892

Financing expenses:Debt Service - Arena Principal 3,000,000 3,000,000 Interest and other financing costs 106,217 7,775,595 7,881,812 Debt Service - Stadium Principal 5,500,000 5,500,000 Interest and other financing costs 28,700 8,353,726 8,382,426

Total financing expenses 134,917 24,629,321 24,764,238

Total expenditures 22,218,040 24,629,321 46,847,361

Excess (deficiency) of revenues over (under) expenditures 18,798,248 1,878,104 (23,131,670) (2,455,318)

Other financing sources (uses) (Note 13)Arena concessions 3,764,866 3,764,866 Concessionaire settlement (3,764,866) (3,764,866) Transfer from OCJV 750,000 750,000 Transfer to OCJV (750,000) (750,000) Operating transfers in 1,878,104 11,722,587 13,600,691 Operating transfers out (11,722,587) (1,878,104) (13,600,691)

Total other financing sources (uses) (9,844,483) (1,878,104) 11,722,587

Net change in fund balances 8,953,765 (11,409,083) (2,455,318)

Fund balances - beginning 20,034,692 63,900,000 32,301,800 116,236,492

Fund balances - ending $ 28,988,457 $ 63,900,000 $ 20,892,717 $ 113,781,174

The accompanying notes are an integral part of these financial statements

OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITYSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES

GOVERNMENTAL FUNDSFOR THE YEAR ENDED JUNE 30, 2007

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OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITYSTATEMENT OF REVENUES AND EXPENDITURES (BUDGETARY BASIS)

BUDGET AND ACTUALFOR THE YEAR ENDED JUNE 30, 2007

Variance Variancewith Final with FinalBudget - Budget -

Actual Positive Actual PositiveOriginal Final Amounts (Negative) Original Final Amounts (Negative)

REVENUES:Club dues $ 750,000 $ 750,000 $ 898,359 $ 148,359 $ $ $ $ Parking & concessions 2,602,000 2,602,000 1,360,120 (1,241,880) Arena facility fees 2,050,000 2,050,000 2,756,851 706,851 Premium seating revenue 7,428,000 7,428,000 7,428,000 Unrealized gain/(loss) on investment 1,878,104 1,878,104 Interest earned 1,338,809 1,338,809 Naming rights 664,000 664,000 1,335,679 671,679 Subsidy to authority 22,300,000 22,300,000 22,300,000 Athletics rent 600,000 600,000 575,000 (25,000) Warriors rent 1,500,000 1,500,000 1,500,000 CBS/Viacom revenue 1,300,000 1,300,000 1,516,592 216,592 Miscellaneous revenue 6,878 6,878

Total revenues 39,194,000 39,194,000 41,016,288 1,822,288 1,878,104 1,878,104

EXPENDITURES: Administrative expenses:

Legal and accounting fees 1,034,000 922,000 157,888 764,112 OACC Inc. expenses 100,000 100,000 260,597 (160,597) Miscellaneous 500,000 500,000 448,746 51,254

Total administrative expenses 1,634,000 1,522,000 867,231 654,769

Operating expenses:Day of game 3,206,750 3,206,750 3,206,750 Marketing expense - OFMA and others 47,710 (47,710) Warrior marketing expense 675,000 675,000 675,000 Playoff expenses - Athletics and Warriors 842,595 (842,595) Commercial property insurance 750,000 750,000 427,058 322,942 Incentive fee - SMG/OCJV 550,000 550,000 656,894 (106,894) Coliseum JV. - subsidy - operations 9,834,000 9,834,000 12,667,259 (2,833,259) Coliseum JV. - subsidy - capital 2,520,000 2,632,000 2,692,626 (60,626)

Total operating expenses 17,535,750 17,647,750 21,215,892 (3,568,142)

Financing expenses:Principal Interest and other financing costs 134,917 (134,917)

Total financing expenses 134,917 (134,917)

Total expenditures 19,169,750 19,169,750 22,218,040 (3,048,290)

Revenues over/(under) expenditures 20,024,250 20,024,250 18,798,248 (1,226,002) 1,878,104 1,878,104

Other financing sources (uses)Arena concessions 3,764,866 3,764,866 Concessionaire settlement (3,764,866) (3,764,866) Transfer from OCJV 750,000 750,000 Transfer to OCJV (750,000) (750,000)

Operating transfers in 1,878,104 1,878,104 Operating transfers out (11,722,587) (11,722,587) (1,878,104) (1,878,104)

Total other financing sources (uses) (9,844,483) (9,844,483) (1,878,104) (1,878,104)

Net change in fund balances 20,024,250 20,024,250 8,953,765 (11,070,485)

Fund balances - beginning 20,034,692 20,034,692 20,034,692 63,900,000 63,900,000 63,900,000

Fund balances - ending $ 40,058,942 $ 40,058,942 $ 28,988,457 $ (11,070,485) $ 63,900,000 $ 63,900,000 $ 63,900,000 $

"continued"

Budgeted Amounts Budgeted Amounts

SPECIAL REVENUE FUNDGENERAL FUND

The accompanying notes are an integral part of these financial statements

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OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITYSTATEMENT OF REVENUES AND EXPENDITURES (BUDGETARY BASIS)

BUDGET AND ACTUALFOR THE YEAR ENDED JUNE 30, 2007

REVENUES:Club duesParking & concessionsArena facility feesPremium seating revenueUnrealized gain/(loss) on investmentInterest earned Naming rightsSubsidy to authorityAthletics rentWarriors rentCBS/Viacom revenueMiscellaneous revenue

Total revenues

EXPENDITURES: Administrative expenses:

Legal and accounting fees OACC Inc. expensesMiscellaneous

Total administrative expenses

Operating expenses:Day of game Marketing expense - OFMA and others Warrior marketing expensePlayoff expenses - Athletics and WarriorsCommercial property insuranceIncentive fee - SMG/OCJVColiseum JV. - subsidy - operationsColiseum JV. - subsidy - capital

Total operating expenses

Financing expenses:Principal Interest and other financing costs

Total financing expenses

Total expenditures

Revenues over/(under) expenditures

Other financing sources (uses)Arena concessionsConcessionaire settlementTransfer from OCJVTransfer to OCJV

Operating transfers in Operating transfers out

Total other financing sources (uses)

Net change in fund balances

Fund balances - beginning

Fund balances - ending

Variance Variancewith Final with FinalBudget - Budget -

Actual Positive Actual PositiveOriginal Final Amounts (Negative) Original Final Amounts (Negative)

$ $ $ $ $ 750,000 $ 750,000 $ 898,359 $ 148,359 2,602,000 2,602,000 1,360,120 (1,241,880) 2,050,000 2,050,000 2,756,851 706,851 7,428,000 7,428,000 7,428,000

119,841 119,841 1,997,945 1,997,945 675,750 675,750 1,377,810 702,060 675,750 675,750 2,716,619 2,040,869

664,000 664,000 1,335,679 671,679 22,300,000 22,300,000 22,300,000

600,000 600,000 575,000 (25,000) 1,500,000 1,500,000 1,500,000 1,300,000 1,300,000 1,516,592 216,592

6,878 6,878

1,497,651 821,901 39,869,750 39,869,750 44,392,043 4,522,293

1,034,000 922,000 157,888 764,112 100,000 100,000 260,597 (160,597) 500,000 500,000 448,746 51,254

1,634,000 1,522,000 867,231 654,769

3,206,750 3,206,750 3,206,750 47,710 (47,710)

675,000 675,000 675,000 842,595 (842,595)

750,000 750,000 427,058 322,942 550,000 550,000 656,894 (106,894)

9,834,000 9,834,000 12,667,259 (2,833,259) 2,520,000 2,632,000 2,692,626 (60,626)

17,535,750 17,647,750 21,215,892 (3,568,142)

8,500,000 8,500,000 8,500,000 8,500,000 8,500,000 8,500,000 12,200,000 12,200,000 16,129,321 (3,929,321) 12,200,000 12,200,000 16,264,238 (4,064,238)

20,700,000 20,700,000 24,629,321 (3,929,321) 20,700,000 20,700,000 24,764,238 (4,064,238)

20,700,000 20,700,000 24,629,321 (3,929,321) 39,869,750 39,869,750 46,847,361 (6,977,611)

(20,700,000) (20,700,000) (23,131,670) (3,107,420) (2,455,318) (2,455,318)

3,764,866 3,764,866

(3,764,866) (3,764,866) 750,000 750,000

(750,000) (750,000) 11,722,587 11,722,587 13,600,691 13,600,691

(13,600,691) (13,600,691)

11,722,587 11,722,587

(20,700,000) (20,700,000) (11,409,083) 8,615,167 (2,455,318) (2,455,318)

32,301,800 32,301,800 32,301,800 116,236,492 116,236,492 116,236,492

$ 11,601,800 $ 11,601,800 $ 20,892,717 $ 8,615,167 $ 116,236,492 $ 116,236,492 $ 113,781,174 $ (2,455,318)

"concluded"

Budgeted Amounts Budgeted Amounts

DEBT SERVICE FUND TOTAL MEMORANDUM (ONLY)

The accompanying notes are an integral part of these financial statements

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OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITY NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS

YEAR ENDED JUNE 30, 2007 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Description of Reporting Entity - Oakland-Alameda County Coliseum Authority (the Authority) is a joint exercise of powers authority formed on July 1, 1995 by and between the City of Oakland, California (the City) and the County of Alameda, California (the County). The Authority was created to assist the City and the County in financing the public capital improvements, pursuant to the Marks-Roos Local Bond Pooling Act of 1985.

Stadium Bonds - In August 1995, the Authority issued 1995 Series A and B Lease Revenue Bonds. The Series A bond proceeds were used to defease the bonds issued earlier by Oakland-Alameda County Coliseum, Inc. (the Coliseum, Inc.) to construct the original Coliseum Complex (the Complex). Following the defeasance of the Coliseum’s bonds, the title to the Coliseum, its structure, and improvements reverted to the City and the County from the Coliseum, Inc. To provide funds to defease the bonds, to fund certain payments to Raiders in consideration of their relocation to Oakland, and to finance the construction of the improvements to the Stadium at the Complex, the following financial structure was implemented. In February 2004, The 1995 Series A Lease Revenue Bond were fully repaid from the escrow established in 1995 at the time the Coliseum Authority issued the Stadium Bonds. The City and the County executed a Ground Lease which leased the Complex to the Oakland-Alameda County Coliseum Financing Corporation (the Financing Corporation), a California non-profit corporation, in return for certain lease payments paid in advance from proceeds of the Series A and B bonds. The Financing Corporation assigned the Ground Lease to the Authority in return for an amount of bond proceeds sufficient to make the payments under the Ground Lease to the City and the County and to fund certain loans to Raiders, including an Operations Loan, a Training Facility Loan and a Stadium Improvement Loan. Under the Assignment Agreement, the Financing Corporation also assigned to the Authority all its rights to receive repayments on the loans made by the Financing Corporation to the Oakland Raiders (the Raiders) formerly, the Los Angeles Raiders, a California limited partnership under the Raiders Loan Agreement. The Authority leased the Complex to the City and the County under a Master Lease. The lease payments under the Master Lease are designed to be sufficient in amount and timing to pay the debt service on the bonds (see Note 9).

The Authority, the City and the County entered into a Management Agreement whereby the City and the County licensed the Complex to the Authority to manage, and the Authority agreed to use any revenue it received from the Complex to offset lease payments under the Master Lease. The Authority originally engaged the Coliseum, Inc. as the operator of the Complex and licensed to the Coliseum, Inc. the Complex for the purposes of operations. The Coliseum, Inc. (see Note 11b) licensed to Raiders the stadium in which to play football

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and licensed the existing stadium to Raiders for the purposes of building and owning the improvements. The Raiders subsequently deeded all the ownership rights to the improvements to the City and County.

On May 25, 2000, the Authority issued $201,300,000 in series 2000 C and D Refunding Bonds to retire $181,900,000 of the 1995 Series B-1 and B-2 Variable Rate Lease Revenue Stadium Bonds ($188,500,000 less $6,600,000 principal payment). Net bond proceeds related to this refunding, is $18,567,232 as indicated below:

Issuance of Refunding Bond $ 201,300,000 Payment to BNY to redeem 95 bond (181,900,000)

Gross Proceeds 9,400,000 Less: Underwriter's Discount (412,020) Less: Letter of Credit Fees (420,748)

Net Bond Proceeds $ 18,567,232

The Refunding Bonds currently are secured by a direct-pay letter of credit issued by Bank of New York and California State Teachers’ Retirement System pursuant to the Reimbursement Agreement.

Arena Bonds - On August 12, 1996, the Authority issued $70,000,000 Series A-1 and $70,000,000 Series A-2 Variable Rate Lease Revenue Bond (Variable Rate Bonds), pursuant to the Marks-Roos Local Bond Pooling Act of 1985, to finance the costs of remodeling the Coliseum Arena (Arena) located at the Oakland-Alameda County Complex, as well as other costs associated with the retention of CC Partners, a California general partnership, d.b.a. Golden State Warriors (the Warriors), to satisfy certain obligations of the Authority, the City, the County and Coliseum, Inc. in connection with the retention of the Warriors to play professional basketball at the Arena for at least 20 basketball seasons, beginning with the 1997-98 season. These obligations are evidenced in a series of agreements (Warrior Agreements) among the Warriors, the City, the County, Coliseum, Inc. and the Authority, to pay interest and related expenses on the Variable Rate Bonds during construction, to provide a reserve fund for the Bonds and to pay the issuance cost of the Bonds.

Under the original Warriors Agreements, the Arena Bonds are limited obligations of the Authority payable solely from revenues of the Authority received by the Authority on behalf of the City and County. These revenues consist of payments from the Warriors up to $7,428,000 annually from premium seating revenues, the sale of personal seat licenses by the Authority, concessionaire payments and Arena naming rights. If necessary to prevent default, additional premium seating revenues up to $10,000,000 may be pledged to service Arena debt. If the above revenues are not sufficient to cover the debt service requirements in any fiscal year, the City and County are obligated to make up the shortfall in the base rental payment from their respective General Funds. The Arena Bonds are currently secured by a direct-pay letter of credit issued by Bank of New York, California State Teachers’ Retirement System and Allied Irish Bank pursuant to the Reimbursement Agreement.

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B. Basis of Presentation

Government-wide Financial Statements: The government-wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all of the nonfiduciary activities of the Authority. The government-wide statements are prepared using the economic resources measurement focus. This is the same approach used in the preparation of the proprietary fund and fiduciary fund financial statements but differs from the manner in which governmental fund financial statements are prepared. Governmental fund financial statements, therefore, include reconciliation with brief explanations to better identify the relationship between the government-wide statements and the statements for the governmental funds. The government-wide statement of activities presents a comparison between direct expenses and program revenues for each function or program of the Authority's governmental activities. Direct expenses are those that are specifically associated with a service, program, or department and are therefore clearly identifiable to a particular function. The Authority does not allocate indirect expenses to functions in the statement of activities. Program revenues include charges paid by the recipients of goods or services offered by a program, as well as grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues are presented as general revenues of the Authority, with certain exceptions. The comparison of direct expenses with program revenues identifies the extent to which each governmental function is self-financing or draws from the general revenues of the Authority. Fund Financial Statements: Fund financial statements report detailed information about the Authority. The focus of governmental fund financial statements is on major funds rather than reporting funds by type. Each major governmental fund is presented in a separate column, and all non-major funds are aggregated into one column. The accounting and financial treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a flow of current financial resources measurement focus. With this measurement focus, only current assets and current liabilities are generally included on the balance sheet. The Statement of Revenues, Expenditures, and Changes in Fund Balances for these funds present increases (i.e. revenues and other financing sources) and decreases (i.e. expenditures and other financing uses) in net current assets. Description of Funds - The accounts of the Authority are organized on the basis of funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for within a separate set of self-balancing accounts that comprise its assets, liabilities, fund balance (or retained earnings), revenues and expenditures or expenses, as appropriate.

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The Authority’s resources are allocated to, and accounted for in, the individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The Authority's activities are organized into major governmental funds as follows: Major Governmental Funds: The General Fund is the primary operating fund of the Authority. It is used to account for all financial resources except those required to be accounted for in another fund. The Special Revenue Fund is used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specific purposes. The Authority maintains one special revenue fund. The Debt Service Fund is used to account for the accumulation of financial resources and payment of general long-term debt principal, interest and related costs. The Authority maintains one debt service fund for the stadium and one debt service fund for the arena.

C. Basis of Accounting: Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the general-purpose financial statements. Basis of accounting relates to the timing of measurement made, regardless of the measurement focus applied. Governmental funds are generally accounted for using the modified accrual basis of accounting. Revenues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current fiscal period. “Available” means the resources will be collected within the current fiscal year or are expected to be collected soon enough thereafter to be used to pay liabilities of the current fiscal year. For the Authority, “available” means collectible within the current period or within 60 days after year-end. Expenditures are recognized in the accounting period in which the liability is incurred (when goods are received or services rendered) except for un-matured interest on general long-term debt, which is recognized when due. Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both the government-wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private-sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The Authority has elected not to follow subsequent private-sector guidance.

D. Budgets and Budgetary Accounting The Authority adopts an annual operation budget on or before June 30 for the ensuing fiscal year for the General Fund and Debt Service Fund. The Board of Commissioners of the Authority must approve the annual budget and any amendments to the budget.

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E. Totals (Memorandum Only)

Columns in the accompanying combined financial statements captioned "Totals (Memorandum Only)" do not present consolidated financial information. They are presented for purposes of additional analysis and are not necessary for a fair presentation of the financial statements. These data are not comparable to a consolidation and do not present financial position or results of operations in conformity with generally accepted accounting principles.

F. Deposits and Investments Investments are reported at fair value in accordance with GASB Statement No. 31,

Accounting and Financial Reporting for certain investments and for External Investment Pools.

G. Restricted Assets Assets that are restricted for specified uses by debt requirements are classified as restricted

because they are maintained in a separate bank account or by fiscal agents and their use is limited by applicable bond covenants or agreements. Liabilities payable from such restricted assets are separately classified on the statement of net assets.

H. Issuance Costs In the government-wide financial statement, issuance costs are deferred and amortized over

the life of the bonds. Long-term debt is reported as net of the unamortized issuance costs. In the fund financial statements, governmental fund types recognize issuance costs at the

time bonds are issued. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures and all other amount is reported as other financing sources or uses.

I. Use of Estimates The preparation of the basic financial statement in conformity with GAAP requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent liabilities at the date of the basic financial statements, and the reported amounts of revenues and expenditures/expenses during the reporting period. Actual results could differ from those estimates.

2. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS

A. Explanation of certain differences between the governmental fund balance sheet and

the government-wide statement of net assets.

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Total fund balances of the Authority’s governmental fund, $113,781,174, differs from net assets of governmental activities, $43,097,254, reported in the statement of net assets. The difference primarily results from the long-term economic focus in the statement of net assets versus the current financial resources focus in the governmental funds balance sheet.

Governmental

Fund

Long-term Assets,

Liabilities

Reclassification and

Eliminations

Statement of Net Assets

Assets

Cash and investments $ 27,074,993 $ $ $ 27,074,993 Cash and investments – restricted

20,892,717

20,892,717

Accounts receivable 1,768,174 1,768,174 Prepaid expenses 367,157 367,157 Raiders loans receivable 104,383,463 104,383,463 Due from OCJV – Stadium 1,487,816 1,487,816 Capital assets (net of accumulated depreciation)

174,871,784

174,871,784

Total assets $ 155,974,320 $ 174,871,784 $ $ 330,846,104

Liabilities Accounts payable $ 1,142,145 $ $ $ 1,142,145 Due to OCJV – Arena 567,538 567,538 Deferred revenue 40,483,464 (40,483,463) Bonds payable (net of unamortized

bond issuance cost)

286,039,167

286,039,167 Total liabilities 42,193,146 286,039,167 (40,483,463) 287,748,850 Fund balances/net assets Total fund balances/net assets 113,781,174 (111,167,383) 40,483,463 43,097,254

Total liabilities and fund $ 155,974,320 $ 174,871,784 $ $ 330,846,104

B. Explanation of certain differences between the governmental fund statement of revenues and expenditures and the government-wide statement of activities.

The net change in fund balances for governmental funds, ($2,455,318) differs from the change in net assets for governmental activities, $2,826,253, reported in the statement of activities. The differences arise primarily from the long-term economic focus in the statement of activities versus the current financial resources focus in the governmental funds. The effect of the differences is illustrated below:

Governmental

Fund

Capital-Related Items

Long-term Debt

Transactions

Long-term Revenues/ Expenses

Interfund

Elimination

Statement of Activities

Total Revenues Club dues $ 898,359 $ $ $ $ $ 898,359 Parking & concessions 1,360,120 1,360,120 Arena facility fee 2,756,851 2,756,851 Premium seating revenue 7,428,000 7,428,000 Interest earned 4,594,723 4,170,580 8,765,303

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Unrealized gain/loss on investment

119,841

119,841

Naming rights 1,335,679 1,335,679 Subsidy to authority 22,300,000 22,300,000 Athletics rent 575,000 575,000 Warriors rent 1,500,000 1,500,000 CBS/Viacom revenue 1,516,592 1,516,592 Miscellaneous revenue

6,878

6,878

Total revenues 44,392,043 4,170,580 48,562,623

Expenditures/Expenses Legal and accounting fees 157,888 157,888 OACC Inc. expenses 260,597 260,597 Misc. admin. expenses 448,746 448,746 Day of game 3,206,750 3,206,750 OFMA marketing expense 47,710 47,710 Warriors marketing expenses 675,000 675,000 Playoff expense 842,595 842,595 Commercial property insurance 427,058 427,058 Incentive fee – SMG 656,894 656,894 Coliseum JV – subsidy – operations

12,667,259

12,667,259

Coliseum JV – subsidy – capital

2,692,626

7,212,518

9,905,144

Debt Service – principal 8,500,000 (8,500,000) Interest & other financing costs

16,264,238

176,491

16,440,729

Total expenditures/expenses

46,847,361

7,212,518

(8,323,509)

45,736,370

Other Financing Sources (Uses)

Arena concessions 3,764,868 3,764,866 Concessionaire settlement (3,764,868) (3,764,886) Transfer from OCJV 750,000 750,000 Transfer to OCJV (750,000) (750,000) Operating transfers in 13,600,691 13,600,691 Operating transfers out 13,600,691) (13,600,691)

Net change for the year $ (2,455,318) $ (7,212,518) $ 8,323,509 $ 4,170,580 $ $ 2,826,253

3. CASH AND INVESTMENTS

Cash and investments as of June 30, 2007 are classified in the accompanying financial statements as follows:

Statement of net assets Cash and investments $ 27,074,993 Restricted cash and investments 20,892,717 Total $ 47,967,710

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Cash and investments as of June 30, 2007 consist of the following:

Deposits with financial institution $ 37,932 Cash in county treasury 27,066,911 Investments 20,862,867 Total $ 47,967,710

A. Deposits

Custodial Credit Risk

The custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, the Authority will not be able to recover deposits or will not be able to recover collateral securities that are in the possession of an outside entity. The Authority does not have a deposit policy for custodial credit risk. The $37,932 deposits with financial institution was covered by federal depository insurance.

B. Investments

The Authority investments consist of (a) County Treasurer’s investments, (b) Investments with fiscal agents.

a. Cash in County Treasury

The Authority maintains its available cash in Alameda County Treasury. The County pools these funds with those of other agencies and invests the cash. These pooled funds are carried at cost, which approximates the market value. All the funds in the pool share any investments losses proportionately.

Funds with the County Treasurer are invested pursuant to investment policy established by

the Treasurer and approved by the Board of Supervisors. The objectives of the policy are, in order of priority, preservation of capital, liquidity and yield. The policy addresses the soundness of financial institutions in which the County deposits funds, the types of investment instruments and the percentage of the portfolio which may be invested in certain instruments, as permitted by Section 53600 et seq. of the Government Code of the State of California. Authorized instruments in which the Treasurer can invest include debts issued by the County, US Treasury securities, banker’s acceptances, federal, state and local government securities, commercial paper, medium-term corporate notes, negotiable certificates of deposit, local agency investment fund, money market funds, mutual funds, and mortgage-backed securities. Information regarding the characteristics of the entire investment pool can be found in the County's June 30, 2007 comprehensive annual financial report. A copy of that report may be obtained by contacting the County's Auditor-Controller Agency, 1221 Oak Street, Room 220, Oakland, CA 94612. As of June 30, 2007, the Authority's share of the County's cash and investment pool totaled $27,066,911.

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b. Investments with Fiscal Agents

The Authority’s Debt Service Fund has investments with fiscal agents. As of June 30, 2007, investments with fiscal agents consisted of the following:

Credit Rating Investment Maturities (in Years)

Investment Type S&P’s/Moody's

Fitch Less

than 1

1-5 More

than 5 Fair

Value Discounted commercial paper

A-1+/P-1 F-1

$

5,952,311

$

$

$

5,952,311

Guaranteed investment contract

AAA

12,905,929

12,905,929 Money market fund

AAAm/Aaa AAA/V-1+

1,997,749

1,997,749

Total $ 7,950,060 $ 12,905,929 $ $ 20,855,989

Interest Rate Risk The investment policy for the Debt Service Fund limits the investment maturity on or

before the dates on which such money is anticipated to be needed for disbursement. The moneys in the Reserve Fund shall be invested with a term not greater than the final maturity date on the Bonds.

Credit Risk The investment policy for the Debt Service Fund limits the fund to investments in

government securities, the local agency investment fund of the State of California, and money markets or mutual funds to the rating in the highest short-term or one of the three highest long-term rating categories by Fitch, Moody's and Standard & Poors.

Concentration of Credit Risk

The investment policy for the Debt Service Fund place no limit on the amount the funds may invest in any one issuer. As of June 30, 2007, more than 5 percent of the Debt Service Fund's investments were in MBIA Inc. Collateralized Flexible Draw Investment (61.88%), Lockhart Funding LLC (14.32%), UBS Finance (14.22%) and JP Morgan Prime Money Market Fund (9.58%).

c. Authority's Investment

The Authority is holding 118 shares of Principal Financial Group, Inc. common stock which was transferred from the Oakland Football Marketing Association. The Authority intends to sell this stock within one year. As of June 30, 2007, the market value of this common stock is $6,878.

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4. ACCOUNTS RECEIVABLE

According to Amendment No.1 to the License Agreement between the Warriors and the Authority, commencing in August every fiscal year, the Warriors agree to make ten monthly payments of Premium Seating Revenue to the Authority to cover the current year’s Arena debt payments up to a cap of $7,428,000. The amounts of $238,356 applicable to the Premium Seating Revenue and $10,232 applicable to the past-due interest on Premium Seating Revenue receivable for fiscal year 2006-07 were outstanding and receivable from the Warriors as of June 30, 2007. In accordance with Amendment No.2 to the License Agreement between the Warriors and the Authority, the Warriors shall pay to the Authority all facility fees collected as to each Home Game and each Non-Warriors Arena event during the prior calendar month including facility fees collected on Luxury Suite tickets. The amounts of $259,971 applicable to the facility fees and $49,191 applicable to the past-due interest on the facility fee receivable were outstanding and receivable from the Warriors as of June 30, 2007. In addition, the Warriors shall pay to the Authority rent of $1,500,000 per annum in four equal quarterly installments on the first business day of each calendar quarter. The amount of $375,000 applicable to the rent was outstanding and receivable from the Warriors as of June 30, 2007.

The Authority entered into the Seventh Amendment to the Agreement with the Oakland Athletics on November 1, 2006, the Athletics agreed to pay the Authority $600,000 rent for the year 2007 and $750,000 for the years 2008 through 2010. The amount of $300,000 applicable to the one-half of the annual rent for the fiscal year 2006-07 was outstanding and receivable from the Athletics as of June 30, 2007, the other half of $300,000 is applicable to the 2007-08 fiscal year. The Project Agreements (referred to Section 3) between the Foster Interstate Media, Inc. (the Foster interstate) and the Authority state that the Foster Interstate will pay to the Authority an annual license fee on a calendar quarter basis in an amount equal to the greater of 36% of Gross Advertising Revenue from the Advertising or 25% of the Minimum Annual License Fee. On February 23, 2004, Foster Interstate was sold to Viacom Outdoor Group Inc., (Viacom) all terms and conditions of the agreement remain unchanged. In January 2006, Viacom changed its name to CBS Outdoor Group Inc. (CBS). The amount of $315,475 applicable to fiscal year 2006-07 was outstanding and receivable from the CBS as of June 30, 2007.

Other accounts receivable include Arena concessions revenue and Arena facility fees. 5. RAIDERS LOANS RECEIVABLE

In accordance with the Master Agreement among the Authority, the City, the County, the Coliseum, Inc., the Financing Corporation, and the Los Angeles Raiders, a California limited partnership, various loans were made to Raiders as follows:

• Operations Loan - totaling $53,900,000, advanced over a period of one year, bearing interest at 6.56% per annum and 6.07% after August 7, 1996 compounded on an annual basis on September 12 and added to the principal. This loan was to be used for relocation costs, for certain matters relating to revenues unavailable to Raiders, and for other matters relating to the transition of operations and business conducted as the Los Angeles Raiders to those of the Oakland Raiders. The balance of the loan on June 30, 2007 was $88,283,807.

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• Training Facility Loan - totaling $10,000,000, advanced over a period of one year, bearing interest at 6.56% per annum and 6.07% after August 7, 1996 compounded on an annual basis on September 12 and added to the principal. This loan was to be used for hard and soft costs of site acquisition, building acquisition and improvements, administration offices, parking areas and practice football fields at the sites selected by the Raiders. The balance of the loan at June 30, 2007 was $16,099,656.

Loans are to be repaid from 50% of the Football Concession Net Revenue, 50% of Football Parking Net Revenue collected by the Raiders commencing with the 1995 football season, and, from an annual payment of $525,000 from the Raiders. (Per Supplement No 1, dated 6/1/96 to the master agreement, effective November 1, 1996.) From the total net revenue collected, 55% of the Net Revenue was applied to the Stadium Improvement Loan, and 45% of the Net Revenue was applied to the Operations and Training Facility Loans in proportion to their unpaid balances at the time of payment. These loans are “Revenue Obligations” of the Raiders. Repayment is limited to amounts received from Parking, Concessions, and Raiders Rent as described above. After reversion of the title to the Stadium Improvements, the full 50% of the Football Concession Net Revenue, 50% Football Parking Net Revenue, and $525,000 Raiders Rent was applied 84% and 16% respectively to the Operations and the Training Facility Loans. In the fiscal year 2006-2007, $1,126,433 of Football Concession Net Revenue and $226,671 of Football Parking Net Revenue were applied to the Operations and Training Facility Loans. In the event of reversion of the Training Facilities to the Authority, Raiders shall receive a credit to the then outstanding balance of the loan in an amount equal to the lesser of (a) the fair market value of the Improvements or Facility and (b) the then outstanding balance of the Loan. The Stadium Improvement Loan with the outstanding balance of $81,682,975 was fully repaid by Raiders on September 15, 1996 by transferring the title of the Stadium Improvement to the Authority.

6. CAPITAL ASSETS

Capital assets, which include construction, property improvement, furniture and fixtures, equipment and vehicles, are reported in the government-wide financial statement governmental activities. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of one year. Structures and improvements with a value of at least $250,000 are capitalized. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Major outlays for capital assets and improvements are capitalized as projects are constructed. The land of the Coliseum Complex is owned by the City and the County. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized.

Construction, property improvement, furniture and fixture, equipment and vehicles of the primary government is depreciated using the straight line method over the following estimated useful lives:

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Assets Years Arena Improvement 30 Stadium Improvement 30

Property Improvement 30 Machinery and Equipment 3-15 Furniture and Fixtures 5-15 Vehicles 5-15

Capital asset activity of the primary government for the year ended June 30, 2007 was as follows:

Balance 7/1/2006

Increases

Decreases

Balance 6/30/2007

Capital assets, not being depreciated:

Construction in progress $ 397,747 $ $ (397,747) $

Total Capital assets, not being Depreciated 397,747 (397,747)

Capital assets, being depreciated:

Arena Improvement 106,272,969 106,272,969 Stadium Improvement 126,577,019 126,577,019 Property Improvement 1,700,000 412,113 2,112,113 Machinery and Equipment 9,381,876 746,279 10,128,155 Furniture and Fixtures 2,610,502 211,237 2,821,739 Vehicles 270,187 270,187 Total capital assets, being depreciated 246,812,553 1,369,629 248,182,182

Less accumulated depreciation for: Arena Improvement (24,177,100) (3,188,189) (27,365,289) Stadium Improvement (34,175,796) (3,797,310) (37,973,106) Property Improvement (470,000) (69,259) (539,259) Machinery and Equipment (5,290,875) (852,372) (6,143,247) Furniture and Fixtures (966,932) (253,313) (1,220,245) Vehicles (45,295) (23,957) (69,252)

Total accumulated depreciation (65,125,998)

(8,184,400)

(73,310,398)

Total capital assets, being depreciated, net 181,686,555 (6,814,771) 174,871,784

Governmental activities capital assets, net $ 182,084,302 $ (6,814,771) $ (397,747) $ 174,871,784

7. ACCOUNTS PAYABLE Accounts payable include legal fees, Arena concessionaire settlement, financing costs, capital

expenses and other miscellaneous administrative expenses, which were incurred as of June 30, 2007 and the OCJV incentive fee for fiscal year 2006-2007.

8. DEFERRED/UNEARNED REVENUE

As of June 30, 2007 deferred revenue of $40,483,463 represents the interest earned and accrued on Raiders loans receivable. As this amount could not be received within the available period established for governmental funds, the same has been deferred under the governmental funds.

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9. LONG-TERM DEBT

Debt payments during the fiscal year ended June 30, 2007 were as follows: Stadium Arena Total

Principal $ 5,500,000 $ 3,000,000 $ 8,500,000 Interest 6,575,495 6,884,875 13,460,370

Total $ 12,075,495 $ 9,884,875 $ 21,960,370 Long-term debt outstanding at June 30, 2007 is as follows:

Type of Indebtedness

Maturity

Interest

Rate

Authorized and Issued

Outstanding at June 30,

2007 STADIUM Series 2000 C Tax Exempt

Lease Revenue Bonds

Feb. 1, 2025

Variable

$

150,800,000

$

150,800,000 Series 2000 D Taxable

Lease Revenue Bonds

Feb. 1, 2025

Variable

50,500,000

19,900,000 Subtotal 201,300,000 170,700,000

ARENA Series A-1

Lease Revenue Bonds

Feb 1, 2026

Variable

70,000,000

58,900,000 Series A-2

Lease Revenue Bonds

Feb 1, 2026

Variable

70,000,000

59,000,000 140,000,000 117,900,000 Total Debt $ 341,300,000 $ 288,600,000

The Lease Revenue Bonds are limited obligations of the Authority, payable solely from certain revenues of the Authority, including revenues from the Stadium & Arena Complex and lease payments from the City and the County. The City and the County have covenanted to appropriate and pay up to $41 million ($22 Million for the Stadium and $19 Million for the Arena) in annual base rental payments and the amount of additional rental payments necessary to maintain the complex. The obligation of the City and County to make such payments is reduced to the extent the authority receives revenues generated at the complex to pay debt service on the lease revenue bonds and for operations and maintenance. In any event, the obligations of the City and the County are limited to rental payments; the lease revenue bonds are not general obligations of either the City or County.

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The following is a summary of long-term debt transactions for the year ended June 30, 2007: Outstanding lease revenue bonds July 1, 2006 $ 297,100,000 Repayments (8,500,000)

Outstanding lease revenue bonds June 30, 2007 288,600,000 Unamortized bond issuance (2,560,833) Amount due within one year (8,900,000)

Long term bonds payable June 30, 2007 $ 277,139,167

Annual debt service requirements to maturity for the revenue bonds, including interest payments, are as follows: 2000 Lease Revenue Bonds: (Stadium) Year Ending June 30 Principal Interest Total

2008 $ 5,800,000 $ 6,288,915 $ 12,088,915 2009 6,200,000 5,924,105 12,124,105 2010 6,700,000 5,562,843 12,262,843 2011 7,100,000 5,212,052 12,312,052 2012 7,500,000 4,951,212 12,451,212 2013-2017 43,400,000 20,458,409 63,858,409 2018-2022 54,500,000 12,088,861 66,588,861 2023-2025 39,500,000 2,332,315 41,832,315

Total $ 170,700,000 $ 62,818,712 $ 233,518,712 1996 Revenue Bonds: (Arena) Year Ending June 30 Principal Interest Total

2008 $ 3,100,000 $ 7,574,900 $ 10,674,900 2009 3,300,000 7,376,850 10,676,850 2010 3,600,000 7,166,350 10,766,350 2011 3,900,000 6,936,450 10,836,450 2012 4,100,000 6,687,150 10,787,150 2013-2017 25,400,000 29,100,650 54,500,650 2018-2022 35,600,000 19,737,800 55,337,800 2023-2026 38,900,000 6,491,450 45,391,450

Total $ 117,900,000 $ 91,071,600 $ 208,971,600 The terms of the Series A-1 and Series A-2 Variable Rate Bonds will be divided into consecutive rate periods, during which the Variable Rate Bonds will bear interest at a daily rate, weekly rate, commercial paper rate or term rate.

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10. FUND BALANCES

Reservations of Fund Balances Reservations of fund balances of the governmental funds represent that portion of fund balances that is legally segregated for a specific future use. Following is a brief description of the nature of reserves. Reserves for debt service – The entire fund balances of the debt service funds are reserved for the payment of principal and interest on the Authority’s general long-term debt as it becomes due. Reserve for encumbrances – Encumbrances are used in all budgeted funds to reserve portions of applicable appropriations for which commitments have been made. Encumbrances are liquidated when the commitments are paid. The encumbrances as of June 30, 2007 represent capital expenditures of $147,313.

11. RELATED PARTY TRANSACTIONS (a) Oakland Football Marketing Association Pursuant to the Marketing Agreement, dated August 7, 1995, the Authority and the Raiders

formed the Oakland Football Marketing Association (OFMA), whose primary activity was to market personal seat licenses, Raiders season tickets, suites and club membership. On March 28, 2006, the Authority and the Raiders entered the Settlement Agreement and Mutual Release, including Supplement No. 2 to Master Agreement and Certain Exhibits to the Master Agreement. According to Section 2f of Supplement No. 2, the Marketing Agreement and the related Marketing Strategy are terminated on the supplement effective date, January 1, 2006. The Authority with the necessary cooperation of the Raiders will proceed to wind down and dissolve the OFMA.

The Authority will be responsible for satisfying all the debts and liabilities of OFMA, other than any obligations related to the Ticketmaster agreement for ticketing services. For the year ended June 30, 2007, the Authority paid $47,710 representing the expenses related to OFMA.

(b) Oakland-Alameda County Coliseum, Inc. (Coliseum, Inc.)/Oakland Coliseum Joint Venture

In October 1995, the Coliseum, Inc. and the Authority entered into an agreement which sets forth the terms and conditions upon which the Coliseum, Inc. would continue to operate, manage, and maintain the Complex facilities. A Board of Directors, some of whom are appointed by the City and the County, governs the Coliseum, Inc. This agreement was terminated as of June 30, 1998.

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The Authority entered into two 2-year agreements on July 1, 1998, with the Oakland Coliseum Joint Venture (OCJV), a Delaware limited liability corporation consisting of SMG, a Pennsylvania, general partnership and Williams Pacific Ventures, Inc. Two agreements (the Stadium Management Agreement and the Arena Management Agreement) engage the OCJV as agent of the Authority to promote, operate, and manage the Complex facilities. In August 2000, the Coliseum, Inc. Board of Directors amended its bylaws to provide that the Authority Commissioners serve as the Coliseum Board's Directors. In January 2001, the Authority terminated its agreement with OCJV. Coliseum, Inc. and OCJV simultaneously entered into a new management agreement, which is substantially the same as the terminated agreement. In July 2002, Coliseum, Inc. and OCJV entered into a new 5-year management agreement. The agreement was amended in March 2005 to extend the term until June 30, 2012. The OCJV will be compensated an annual fixed fee of $200,000, allocated one-half to the Stadium and one-half to the Arena; and an incentive fee which calculated by the OCJV generated revenues. The total compensation for the year ended June 30, 2007 is $656,894. The Operating Agreement between the Authority and Coliseum Inc. expired on July 31, 2006. The Authority entered into a Termination Agreement whereby, in return for certain consideration, the Authority agreed to perform the duties of Coliseum, Inc. on and after August 1, 2006. For fiscal year 2006-07, the Authority subsidized OCJV operations for $13,918,311. This amount includes operating funding of $8,686,561, day of game expenses of $3,206,750, Warriors rent of $1,500,000 and Raiders rent of $525,000. The Authority also contributed funds of $2,743,336 for the capital improvements and expenditures during the fiscal year 2006-2007.

12. OAKLAND-ALAMEDA COUNTY COLISEUM FINANCING CORPORATION (THE FINANCING CORPORATION)

The Oakland-Alameda County Coliseum Financing Corporation (the Financing Corporation) is

a component unit of the Authority. It is a non-profit public benefit corporation whose members coincide with those of the Authority. One purpose of forming the Authority is to provide loans to the Raiders for the remodeling of the Stadium and relocation costs of the Raiders associated with the team’s move to Oakland, California. Since the Authority is restricted by law from legally providing loans, the Financing Corporation was created with the intent of providing various facilities as described above and in Note 1 exclusively for the Authority.

In accordance with Governmental Accounting Standards Board (GASB) Statement No. 14, The

Financial Reporting Entity, component units should be blended if the units provide services or benefits exclusively, or almost exclusively, to a primary government (PG). Blending means that the component unit’s financial data is reported as though the unit is part of the PG. No funds, however, should be blended with the general fund of the PG. Instead, the separate general funds of the component units should be reclassified as special revenue funds. Accordingly, the financial statements of Financing Corporation have been presented under the Special Revenue Fund of the Authority.

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13. OTHER FINANCING SOURCES (USES) Other Financing Sources represent Arena concession revenues from the Levy Restaurants for

the concession and premium food services, at all events at the facility. One third of the concession gross receipts and 50% of the net premium food service revenues from Warrior games are remitted to the Golden State Warriors. The revenues from other events are remitted to OCJV in the form of Other Financing Uses. The balance of the revenues is retained by the Authority, which is reclassified as the Authority's concession revenue. Also included in other financing sources/uses are the operating transfers for the Warriors rent, Stadium Concession/Parking revenues and Raiders Loan Repayment.

14. MANAGEMENT OF THE AUTHORITY

The Authority entered into an agreement to engage an Executive Director to provide overall direction and management of the Oakland-Alameda County Coliseum Complex. On November 18, 2002 the Authority signed a three year agreement with Ann Haley to provide the oversight and management direction of the Complex. The agreement was amended on September 8, 2005 to extend the term of the Agreement from three years to five years. In addition, the Authority engages an Administrative Assistant to provide administrative services under the supervision of the executive director.

15. PROVISION OF SERVICES FREE OF CHARGE The Authority has two positions for which it contracts for managing its operations (see Note

14). All the administrative and clerical duties are performed by staffs of the City and the County, currently at no charge, or by outside consultants and attorneys. The City of Oakland provides all payroll services including withholding taxes, making pension payments and providing heath insurance. The Authority fully reimburses the City for these costs.

16. COMMITMENTS AND CONTINGENCIES On November 1, 2006, the Authority entered into an agreement with the Warriors for the

approval of Oracle Agreement and the allocation of Oracle Payment for Arena Naming Rights and Golden State Warriors Sponsorship Rights. The Oracle Agreement provides a set payment from Oracle to the Warriors in the gross amount of $3,000,000 a year for ten years. The Oracle payment shall be allocated between the Authority and the Warriors after deducting all expenses and costs related to both the naming rights and sponsorship components of the Oracle Agreement. During each year of the Oracle Agreement term, the first $250,000 of the net annual proceeds shall be paid to the Authority, the next $500,000 shall be retained by the Warriors. The amount in excess of $750,000 shall be applied 40% and 60% respectively to the Authority and the Warriors. For fiscal year 2006-07, the Authority received $671,298 from the Warriors for the net naming rights payment. On August 26, 2003 the Raiders were awarded $34.2 million by a Sacramento County jury that found Coliseum, Inc. made negligent representations concerning ticket sales in connection with its efforts to bring the team back from Los Angeles. Attorneys for the Coliseum, Inc. have filed an appeal of that decision. On November 17, 2006, the Third Appellate District of the California Court of Appeal overturned this entire verdict and ordered the Raiders to pay the Coliseum Inc.'s costs of the appeal. The Raiders and the Coliseum Inc. subsequently agreed that the Raiders would waive all rights to further appeals in return for the Coliseum Inc.'s waiving the Raiders paying the costs of appeal.

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17. LEASE OBLIGATIONS On the dissolution of Oakland Football Marketing Association (OFMA), the Authority undertook the responsibility for the lease commitment for office space and copier used by the OFMA. Minimum future rental payments under noncancelable operating leases having remaining terms in excess of one year as of June 30, 2007, for each of the next four years and in the aggregate are:

Year ending June 30:

Office Space

Copier

Total

2008 $ 70,000 $ 7,980 $ 77,9802009 71,200 7,980 79,1802010 72,400 4,655 77,0552011 48,800 48,800

$ 262,400 $ 20,615 $ 283,015

OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITY FINDINGS AND RECOMMENDATIONS FOR THE YEAR ENDED JUNE 30, 2007

There were no material findings for the year ended June 30, 2007.

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OAKLAND-ALAMEDA COUNTY COLISEUM AUTHORITY STATUS OF PRIOR YEAR FINDINGS

FOR THE YEAR ENDED JUNE 30, 2007

There were no material findings in prior year audit.