525 Third Street Beaver, PA 15009 (724) 683-3400 - PDF document

525 Third Street Beaver, PA 15009 (724) 683-3400 www.cottrillarbutina.com

February 26, 2018 February 26, 2018 Fort Ch Fort Cherry School Di erry School District strict 2016-2017 Audit 2016-2017 Audit Sections • Overview of 16-17 Audit • Historical Analysis of District Finances • Suggestions for Improvement 1

Overview of the 2016-2017 Audit Independent Auditor’s Report  Expresses that the Financial Statements fairly represent the financial position of the School District as, and for the year ended, June 30, 2017.  Clean opinion - we were able to obtain reasonable justification that the numbers are fairly presented (materially stated). 2

Management’s Discussion and Analysis (MD&A)  The intent of this discussion and analysis is to look at the District’s financial performance as a whole  Specific comments regarding Fort Cherry School District  Often carries more relevance to the average Financial Statement reader than the audit report does  We do not give an opinion on the MD&A, it is simply management’s view point Pennsylvania School Employees’ Retirement System (PSERS) 3

Estimated District Liability  PSERS State-wide Net Pension PSERS Liability at 6/30/16: $49.6 Billion  Fort Cherry SD’s % of Liability: 0.0586%  Fort Cherry SD’s share of PSERS District Liability at 6/30/17: $29.040 Million Fort Cherry Projected PSERS Expense PSERS Expense $- $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 16-17 $2,330,622 17-18 $2,527,751 18-19 $2,652,703 19-20 $2,757,476 20-21 $2,790,072 21-22 $2,824,997 PSERS rates used in calculation of payroll expense: http://www.psers.pa.gov/About/PFR/Documents/20171208%20FY%202018- 2019%20ECR%20fact%20sheet%20FINAL.pdf 4

Historical Analysis of District Finances Fund Balance/Net Position $4,000,000 $3,494,881 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $ ‐ General Fund Food Service Fund $(500,000) $(469,535) $(1,000,000) 5

Investment Earnings ‐ District ‐ Wide $27,079 16 ‐ 17 $4,724,895 $15,429 15 ‐ 16 $5,005,736 $9,265 14 ‐ 15 $6,405,917 $11,342 13 ‐ 14 $5,853,391 $9,551 12 ‐ 13 $4,072,761 $ ‐ $2,000,000 $4,000,000 $6,000,000 $8,000,000 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Investment Earnings $9,551 $11,342 $9,265 $15,429 $27,079 Average Cash and Cash Equivalents $4,072,761 $5,853,391 $6,405,917 $5,005,736 $4,724,895 0.7% 0.6% 0.6% 0.5% 0.4% 0.3% 0.3% 0.2% 0.2% 0.2% 0.1% 0.1% 0.0% 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Investment Earnings as a Percentage of Cash and Cash Equivalents 60% 50% 40% 30% 20% 10% 0% 12‐13 13‐14 14‐15 15‐16 16‐17 Federal 1.52% 1.51% 1.28% 1.53% 1.18% Local 42.14% 42.06% 42.67% 42.78% 42.33% State 56.34% 56.43% 56.06% 55.69% 56.48% $20,000,000 $18,000,000 $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $‐ 12‐13 13‐14 14‐15 15‐16 16‐17 State $9,376,449 $9,414,976 $9,612,270 $9,770,260 $10,133,715 Local $7,014,109 $7,018,570 $7,316,716 $7,504,536 $7,594,386 Federal $253,497 $251,765 $218,689 $268,761 $212,580 6

General Fund Revenue & Expenditures vs. Budget Totals $18,000,000 $17,900,000 $17,800,000 $17,700,000 $17,600,000 $17,500,000 $17,400,000 $17,300,000 $17,200,000 $17,100,000 $17,000,000 Revenue Expense Actual $17,940,681 $17,928,948 Budget $17,314,081 $17,499,191 General Fund Budget vs. Actual Revenues by Type (2016 ‐ 17 Fiscal Year) $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $ ‐ Local State Federal Actual $7,594,386 $10,133,715 $212,580 Budgeted $7,316,734 $9,686,472 $188,000 7

General Fund Budget vs. Actual Instruction Expenditures (2016 ‐ 17 Fiscal Year) $8,000,000 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $ ‐ Regular Programs Special Programs Vocational Programs Other Instructional Programs Actual $7,942,709 $2,614,162 $459,839 $79,486 Budget $7,773,253 $2,231,845 $617,700 $66,475 General Fund Budget vs. Actual Support Services Expenditures (2016 ‐ 17 Fiscal Year) $2,000,000 $1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $ ‐ Pupil Serv. Instructiona Admin. Pupil Health Business Ops. & Stud.Trans. Central Other l Main. Support Services Actual $345,179 $454,280 $1,178,673 $204,015 $334,402 $1,943,508 $1,225,066 $330,999 $11,792 Budget $357,843 $454,629 $1,233,845 $200,038 $370,836 $1,902,309 $1,079,200 $194,473 $13,000 8

General Fund Budget vs. Actual NonInstructional, Capital Outlay, Debt Service and Other Expenditures (2016 ‐ 17 Fiscal Year) $500,000 $400,000 $300,000 $200,000 $100,000 $ ‐ $(100,000) $(200,000) Student Community Debt Services Budgetary Transfers Out Transfers In Activity Reserve Actual $458,779 $5,500 $242,671 $0 $(97,888) $ ‐ Budget $452,245 $5,500 $251,000 $(125,000) $(170,000) $122,875 General Fund Debt Service ‐ Total Expenditures $2,000,000 $1,500,000 $1,000,000 $500,000 $ ‐ 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Debt Service $1,761,803 $190,391 $250,413 $252,863 $242,671 General Fund Debt Service Ratio 15.00% 10.00% 5.00% 0.00% 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Percentage 10.78% 1.16% 1.46% 1.29% 1.35% 9

Bond Payments as a Percentage of Total Expenditures 1.50% 1.00% 0.50% 0.00% 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Percentage 1.16% 1.46% 1.29% 1.35% Bond Payments as a Percentage of Fund Balance 7.60% 7.40% 7.20% 7.00% 6.80% 6.60% 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Percentage 7.46% 7.04% 7.26% 6.94% General Fund Revenue vs. Expenditures $20,000,000 $19,000,000 $18,000,000 $17,000,000 $16,000,000 $15,000,000 $14,000,000 $13,000,000 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Revenue $16,644,055 $16,685,311 $17,147,675 $17,543,557 $17,940,681 Expenditures $16,342,410 $16,396,572 $17,152,430 $17,617,561 $17,928,948 10

$350 $300 $250 $200 $150 $100 $50 $ ‐ $(50) $(100) 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Rev/Exp $301,645 $288,739 $(4,755) $(74,004) $11,733 $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $ ‐ 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Fund Balance $2,312,996 $2,601,735 $3,557,152 $3,483,148 $3,494,881 NOTE: The Capital Reserve Fund is reported under the General Fund heading beginning in 2014-15. See Note 13 in prior years. Cafeteria Revenue by Source $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $ ‐ 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Subsidies $317,452 $334,792 $332,708 $331,750 $397,134 Sales $344,420 $347,383 $327,427 $335,330 $329,102 11

Cafeteria Fund Revenue (excl. Transfers) vs. Expenses $900,000 $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $ ‐ 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Revenue $661,958 $682,244 $660,220 $667,307 $726,905 Expenditures $718,022 $705,503 $734,011 $807,675 $808,585 Cafeteria Unrestricted Net Position History $ ‐ $(100,000) $(200,000) $(300,000) $(400,000) $(500,000) $(600,000) $(700,000) $(800,000) 12 ‐ 13 13 ‐ 14 14 ‐ 15 15 ‐ 16 16 ‐ 17 Net Position $(58,069) $(22,798) $(666,674) $(686,303) $(645,472) NOTE: 2014-15 and 2016-2017 include a Prior Period Adjustment. See Notes in prior years reports. Debt Analysis Outstanding Principal  Bonds – Bonds – the District he District has an outstan has an outstandin ing g $4,000,000 principal balance of principal balance of $3,520,000 $3,520,000 $2,000,000 $ ‐ 2013 G.O.B. 2016 G.O.B.  Compens Compensated ted Absences- Absences- $51 $513,069 ,069 $800,000 $600,000  Other Post Other Post $400,000 Employment Benefits - Employment Benefits - $200,000 $653 $653,417 ,417 $ ‐ Comp Abs OPEB 12