PRES ENTATION OF JUNE 30, 2015 AUDITED FINANCIAL S TATEMENTS October 16, 2015 S terling College
Required Communication Unqualified opinion GAAS and GAS – reasonable but not absolute assurance S ignificant accounting policies Management j udgments and accounting estimates Allowance for bad debts Depreciation Audit adj ustments – 12 Eight of these entries were proposed by Deb during the course of the audit. One entry proposed by audit team was material. Disagreements with management – None No difficulties encountered when performing the audit Good initial meetings and weekly communications helped streamline the audit process
Highlights and Comments S tatement of Financial Position Decrease in cash of roughly $507K primarily due to purchases if fixed assets and fact that a large portion of current contributions were in receivables. Increase in pledges receivable by $1.2M (primarily due to AG pledge) Prepaid expenses increase of $24K mainly due to Labrador and S ierra NV GFS Courses Construction in progress decreased $62K due to completion of the wireless proj ect and less work on the barn proj ect. Investments increased $100K due to earnings.
Highlights and Comments S tatement of Financial Position Property and equipment increased by $1.7M net of accumulated depreciation due to real estate acquisition, equipment and renovations place in service. Accrued expenses decreased by $90K included $40K decrease in student accounts payable with much of the remaining decrease due to reduced payroll tax and retirement plan accruals in 2015 versus 2014. Unearned tuition increased by about $76K due to an increase in enrollment for that period of 37 students. Long-term debt increased $408K due to spending on capital proj ects.
Highlights and Comments S tatement of Activities $1.31M in net income primarily due to increases in student tuition and fees, auxiliary enterprises (24% of tuition in 2015 and 27% of tuition in 2014), and in contributions (up $1.2M) Expenses increased $937K mostly due to increased student aid (due to increase in students) and program services.
Discussion Items Current Y ear Increase board involvement No significant deficiencies in current year Be diligent about enforcing good policy i.e. segregation of duties
Balance S heet Ratios Ratios 2011 2012 2013 2014 2015 Days cash on hand 18 18 3 32 2 Days revenue in receivables 10 6 8 16 23 – excluding bequest Current ratio – excluding 0.98 0.38 0.33 1.12 .41 bequest Quick ratio – excluding 0.89 1.10 0.24 1.05 .36 bequest Debt to net assets 20% 18% 21% 20% 21%
Income S tatement Ratios Ratios 2011 2012 2013 2014 2015 Program expense % 84% 86% 84% 84% 84% Management expense % 15% 12% 13% 13% 13% Fundraising expense % 1% 2% 3% 3% 3% Fundraising efficiency 89% 90% 79% 88% 93%
Analysis Total Support and Revenue $10,000,000 $9,000,000 $8,661,954 $8,000,000 $7,000,000 $7,094,149 $6,000,000 $5,243,339 $5,000,000 Total S upport and $4,693,781 $4,869,902 Revenue $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 2011 2012 2013 2014 2015
Analysis Change in Net Assets $1,500,000 $1,311,994 $1,000,000 $681,241 $500,000 $319,366 Change in Net Assets $86,223 $0 2011 2012 2013 2014 2015 -$500,000 -$520,950 -$1,000,000
Analysis Program Service Fees Program $7,000,000 S ervice Fees $6,195,966 $6,000,000 $5,399,081 $5,000,000 $4,552,131 $4,236,958 $4,000,000 $3,858,318 $3,000,000 $2,000,000 $1,000,000 $0 2011 2012 2013 2014 2015
Analysis Personnel Expenses Personnel Expenses $2,500,000 $2,351,752 $2,228,829 $2,000,000 $1,981,868 $1,858,901 $1,737,159 $1,500,000 $1,000,000 $500,000 $0 2011 2012 2013 2014 2015
Analysis Personnel as % of Total Support Personnel as 45.0% % of Total S upport 40.0% 40.7% 37.0% 35.0% 34.8% 35.5% 30.0% 27.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 2011 2012 2013 2014 2015
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