Management report, Albany Technical College, Albany, Georgia, an organizational unit of the state of Georgia, 2019 June 30

ALBANY TECHNICAL COLLEGE
ALBANY, GEORGIA
MANAGEMENT REPORT FOR FISCAL YEAR ENDED JUNE 30, 2019
A Member Institution of the Technical College System of Georgia

ALBANY TECHNICAL COLLEGE - TABLE OF CONTENTS -

SECTION I
FINANCIAL
LETTER OF TRANSMITTAL
SELECTED FINANCIAL INFORMATION
EXHIBITS
A STATEMENT OF NET POSITION - (GAAP BASIS) B STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION -
(GAAP BASIS) C STATEMENT OF CASH FLOWS - (GAAP BASIS) D SELECTED FINANCIAL NOTES
SUPPLEMENTARY INFORMATION
SCHEDULES
1 BALANCE SHEET - (STATUTORY BASIS) BUDGET FUND 2 SUMMARY BUDGET COMPARISON AND SURPLUS ANALYSIS REPORT
(STATUTORY BASIS) BUDGET FUND 3 STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET
BY PROGRAM AND FUNDING SOURCE (STATUTORY BASIS) BUDGET FUND
4 STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE (STATUTORY BASIS) BUDGET FUND

Page
2 3 4 6
27 28 30 32

SECTION II ENTITY'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS

SECTION III FINDINGS, QUESTIONED COSTS AND OTHER ITEMS SCHEDULE OF FINDINGS, QUESTIONED COSTS AND OTHER ITEMS

SECTION IV MANAGEMENT'S CORRECTIVE ACTION FOR CURRENT YEAR FINDINGS SCHEDULE OF MANAGEMENT'S CORRECTIVE ACTION

SECTION I FINANCIAL

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
November 19, 2019

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of the Technical College System of Georgia Members of the Local Board of Directors
and Dr. Anthony Parker, President Albany Technical College
Ladies and Gentlemen:
This Management Report contains information pertinent to the Albany Technical College's compliance with the requirements of the Southern Association of Colleges and Schools Commission on Colleges (COC) Standard 13.2 (Financial Resources) as of and for the year ended June 30, 2019. Additionally, we audited Albany Technical College's Federal Student Aid programs for the year ended June 30, 2019 to meet the requirements of COC Standard 13.6. Included in this report is a section on findings and other items for any matters that came to our attention during our engagement, including results of our audit of the Federal Student Aid programs. The other information contained in this report is the representation of management. Accordingly, we do not express an opinion or any form of assurance on it.
Additionally, we have performed certain procedures at Albany Technical College to support the issuance of the State of Georgia Single Audit Report pursuant to the Single Audit Act Amendments, as of and for the year ended June 30, 2019.
This report is intended solely for the information and use of the management of Albany Technical College, members of the State Board of the Technical College System of Georgia, members of the Local Board of Directors, and the Southern Association of Colleges and Schools Commission on Colleges and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,

Greg S. Griffin State Auditor

(This page left intentionally blank)

SELECTED FINANCIAL INFORMATION - 1 -

ALBANY TECHNICAL COLLEGE STATEMENT OF NET POSITION - (GAAP BASIS)
JUNE 30, 2019
ASSETS
Current Assets Cash and Cash Equivalents Accounts Receivable, Net Receivables - Federal Financial Assistance Receivables - Other Prepaid Items Inventories
Total Current Assets
Noncurrent Assets Net OPEB Asset Capital Assets, Net
Total Noncurrent Assets
Total Assets
Deferred Outflows of Resources Related to Defined Benefit Pension Plans and OPEB
LIABILITIES
Current Liabilities Accounts Payable Salaries Payable Unearned Revenue (Including Tuition and Fees) Deposits Held for Other Organizations Capital Leases Compensated Absences
Total Current Liabilities
Noncurrent Liabilities Capital Leases Compensated Absences Net OPEB Liability Net Pension Liability
Total Noncurrent Liabilities
Total Liabilities
Deferred Inflows of Resources Related to Defined Benefit Pension Plans and OPEB
NET POSITION
Net Investment in Capital Assets Restricted
Expendable Unrestricted (Deficit)
Total Net Position

EXHIBIT "A"

$

2,221,812.83

222,485.78 976,090.76
9,460.97 176,585.39

3,606,435.73

285,320.00 27,846,120.26
28,131,440.26
31,737,875.99

5,848,646.09

499,316.33 52,030.32
827,029.75 191,686.48
6,940.25 659,935.55
2,236,938.68
10,355.81 497,846.11 9,970,566.00 16,668,982.00
27,147,749.92
29,384,688.60
6,669,099.00

27,828,824.20
301,187.54 (26,597,277.26)

$

1,532,734.48

- 2 -

ALBANY TECHNICAL COLLEGE STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION - (GAAP BASIS)
YEAR ENDED JUNE 30, 2019

EXHIBIT "B"

OPERATING REVENUES
Student Tuition and Fees (Net) Grants and Contracts
Federal Rents and Royalties Sales and Services Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES
Salaries Benefits Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Loss
NONOPERATING REVENUES (EXPENSES)
State Appropriations Grants and Contracts
Federal State Local Gifts Investment Income Interest Expense (Capital Assets) Other Nonoperating Revenues Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues
Income Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts State
Extraordinary Items
Total Other Revenues, Expenses, Gains, or Losses
Change in Net Position
Net Position - Beginning of Year
Net Position - End of Year

$ 4,907,321.26
58,385.92 3,588.80
1,192,701.68 69.00
6,162,066.66
12,208,954.84 2,113,601.90 160,499.33 7,406,585.87 1,136,178.13 4,317,850.98 1,834,429.69
29,178,100.74
(23,016,034.08)
11,962,702.94
13,864,064.63 252,637.56 41,655.00 307,946.69 2,079.87 (5,016.67) 167,559.83 (307,946.69)
26,285,683.16
3,269,649.08
446,351.06 650,000.00
1,096,351.06
4,366,000.14
(2,833,265.66)
$ 1,532,734.48

- 3 -

ALBANY TECHNICAL COLLEGE STATEMENT OF CASH FLOWS - (GAAP BASIS)
YEAR ENDED JUNE 30, 2019
CASH FLOWS FROM OPERATING ACTIVITIES Tuition and Fees Grants and Contracts (Exchange) Sales and Services Payments to Suppliers Payments to Employees Payments for Scholarships and Fellowships Other Receipts
Net Cash Used by Operating Activities
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES State Appropriations Agency Funds Transactions Gifts and Grants Received for Other than Capital Purposes Other Noncapital Financing Payments
Net Cash Flows Provided by Noncapital Financing Activities
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Capital Grants and Gifts Received Purchases of Capital Assets Principal Paid on Capital Debt Interest Paid on Capital Debt
Net Cash Provided by Capital and Related Financing Activities
CASH FLOWS FROM INVESTING ACTIVITIES Investment Income
Net Increase in Cash
Cash and Cash Equivalents - Beginning of Year
Cash and Cash Equivalents - End of Year
RECONCILIATION OF OPERATING LOSS TO NET CASH USED BY OPERATING ACTIVITIES:
Operating Loss Adjustments to Reconcile Operating Income to Net Cash
Used by Operating Activities Depreciation Expense Change in Assets and Liabilities: Accounts Receivable, Net Prepaid Items Inventories Net OPEB Asset Salaries Payable Accounts Payable Unearned Revenue (Including Tuition and Fees) Compensated Absences Net Pension Liability Net OPEB Liability Change in Deferred Inflows/Outflows of Resources Deferred Inflows of Resources Deferred Outflows of Resources
Net Cash Used by Operating Activities
NONCASH ACTIVITY Gift of Capital Assets Reducing Proceeds of Capital Grants and Gifts
- 4 -

EXHIBIT "C"

$

4,804,437.97

58,385.92

1,192,701.68

(11,118,973.57)

(12,217,083.45)

(7,406,585.87)

3,657.80

(24,683,459.52)

11,962,702.94 136,000.39
14,545,525.97 (171,675.60)
26,472,553.70

871,284.48 (628,264.92) (104,355.94)
(5,016.67)
133,646.95

2,079.87 1,924,821.00
296,991.83

$

2,221,812.83

$ (23,016,034.08)
1,834,429.69
22,645.02 (984.51)
44,477.87 (5,023.00) (5,723.93) 259,245.50 (125,528.31) (2,404.68) (545,650.00) (6,173,961.00)
4,085,726.00 (1,054,674.09)

$ (24,683,459.52)

$

225,066.58

(This page left intentionally blank)

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
Albany Technical College (the Institution) is one of twenty-two (22) State supported member Institutions of postsecondary education in Georgia which comprise the Technical College System of Georgia, an organizational unit of the State of Georgia. The accompanying financial statements reflect the operations of Albany Technical College as a separate reporting entity.
The Institution's Local Board of Directors is composed of twelve (12) members serving staggered threeyear terms who are appointed by the State Board of the Technical College System of Georgia. Appropriation of State funds is made to the Technical College System of Georgia by the General Assembly of Georgia. The System Office of the Technical College System of Georgia determines the amount of state appropriations to be received by the Institution. The Institution does not have authority to retain unexpended state appropriations (surplus) for any given fiscal year. Accordingly, the Institution is considered an organizational unit of the Technical College System of Georgia for financial reporting purposes because of the significance of its legal, operational, and financial relationships as defined in Section 2100 of the Governmental Accounting Standards Board (GASB) Codification of Governmental Accounting and Financial Reporting Standards.
The accompanying basic financial statements represent the financial position, changes in financial position and cash flows of only that portion of the business-type activities of the State that are attributable to the transactions of the Institution. They do not purport to, and do not, present fairly the financial position of the State as of June 30, 2019, the changes in its financial position or its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
The accompanying basic financial statements should be read in conjunction with the State's CAFR. The most recent State of Georgia CAFR can be obtained through the State Accounting Office, 200 Piedmont Avenue, Suite 1604 (West Tower), Atlanta, Georgia 30334 or found at https://sao.georgia.gov/comprehensive-annual-financial-reports.
BASIS OF ACCOUNTING AND FINANCIAL STATEMENT PREPARATION
The financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) as prescribed by the GASB and are presented as required by these standards to provide a comprehensive, entity-wide perspective of the Institution's assets, deferred outflows of resources, liabilities, deferred inflows of resources, net position, revenues, expenses, changes in net position and cash flows.
The Institution's business-type activities financial statements have been presented using the economic resources measurement focus and the accrual basis of accounting. Under the accrual basis, revenues are recognized when earned, and expenses are recorded when an obligation has been incurred. Grants and similar items are recognized as revenues in the fiscal year in which eligibility requirements imposed by the provider have been met. All significant intra-college transactions have been eliminated.
NEW ACCOUNTING PRONOUNCEMENTS
For fiscal year 2019, the Institution adopted Governmental Accounting Standards Board (GASB) Statement No. 83, Certain Asset Retirement Obligations. This statement addresses accounting and financial reporting for certain assert retirement obligations (AROs). This statement also requires disclosure of information about the nature of a government's AROs, the methods and assumptions
- 6 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

used for the estimates of the liabilities, and the estimated remaining useful life of the associated tangible capital assets. The adoption of this statement does not have a significant impact on the Institution's financial statements.
For fiscal year 2019, the Institution adopted Governmental Accounting Standards Board (GASB) Statement No. 88, Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placements. The objective of this statement is to improve the information that is disclosed in notes to government financial statements related to debt, including direct borrowings and direct placements. The adoption of this statement does not have a significant impact on the Institution's financial statements.
NET POSITION
The Institution's net position is classified as follows:
Net Investment in Capital Assets: This represents the Institution's total investment in capital assets, net of accumulated amortization/depreciation and reduced by outstanding debt obligations related to those capital assets. Deferred outflows of resources and deferred inflows of resources that are attributable to the acquisition, construction or improvement of capital assets or related debt are included in Net Investment in Capital Assets. If there are significant unspent related debt proceeds or deferred inflows of resources at the end of the reporting period, the portion of the debt or deferred inflows of resources attributable to the unspent amount are not included in Net Investment in Capital Assets.
Restricted: expendable: Includes resources in which the Institution is legally or contractually obligated to spend resources in accordance with restrictions by external third parties.
Unrestricted: Unrestricted represents resources derived from student tuition and fees, state appropriations, and sales and services of educational departments. These resources are used for transactions relating to the educational and general operations of the Institution, and may be used at the discretion of the Institution to meet current expenses for those purposes, except for unexpended state appropriations (surplus) in the amount of $12,793.16. Unexpended state appropriations must be refunded to the Office of the State Treasurer.
SCHOLARSHIP ALLOWANCES
Scholarship allowances are the differences between the stated charge for goods and services provided by the Institution, and the amount that is paid by students and/or third parties making payments on the students' behalf. Certain governmental grants, such as Pell grants, and other Federal, state or non-governmental programs are recorded as either operating or non-operating revenues in the Institution's financial statements. To the extent that revenues from such programs are used to satisfy tuition and fees and other student charges, the Institution has recorded contra revenue for scholarship allowances. Sponsored and Unsponsored Scholarship Allowances totaled $3,801,079.76 for the year ending June 30, 2019.

- 7 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

NOTE 2: DEPOSITS Reconciliation of cash and cash equivalents balances to carrying value of deposits:

Cash and Cash Equivalents Statement of Net Position
Less: Cash on hand

$

2,221,812.83

1,700.00

Total carrying value of deposits - June 30, 2019 DEPOSITS

$

2,220,112.83

The custodial credit risk for deposits is the risk that in the event of a bank failure, the Institution's deposits may not be recovered. Funds belonging to the State of Georgia (and thus the Institution) cannot be placed in a depository paying interest longer than ten days without the depository providing a surety bond to the State. In lieu of a surety bond, the depository may pledge as collateral any one or more of the following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59:

1. Bonds, bills, notes, certificates of indebtedness, or other direct obligations of the United States or of the State of Georgia.

2. Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia.

3. Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose.

4. Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia.

5. Bonds, bills, certificates of indebtedness, notes or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association and the Federal National Mortgage Association.

6. Guarantee or insurance of accounts provided by the Federal Deposit Insurance Corporation.

The Institution participates in the State's Secure Deposit Program (SDP), a multi-bank pledging pool. The SDP requires participating banks that accept public deposits in Georgia to operate under the policy and procedures of the program. The Georgia Office of State Treasurer (OST) sets the collateral requirements and pledging level for each covered depository. There are four tiers of collateralization levels specifying percentages of eligible securities to secure covered Deposits: 25%, 50%, 75%, and 110%. The SDP also provides for collateral levels to be increased to amount of up to 125% if economic or financial conditions warrants. The program lists the type of eligible collateral. The OST approves authorized custodians.

- 8 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

In accordance with the SDP, if a covered depository defaults, losses to public depositors are first satisfied with any applicable insurance, followed by demands of payment under any letters of credit or sale of the covered depository's collateral. If necessary, any remaining losses are to be satisfied by assessments made against the other participating covered depositories. Therefore, for disclosure purposes, all deposits of the SDP are considered to be fully collateralized.

At June 30, 2019, the bank balances of the Institution's deposits totaled $3,114,058.08. Of these deposits, $0 were exposed to custodial credit risk.
NOTE 3: ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following at June 30, 2019:

Student Tuition and Fees Federal Financial Assistance Other

$ 136,913.87 222,485.78 921,684.77

Less Allowance for Doubtful Accounts

1,281,084.42 82,507.88

Accounts Receivable, Net NOTE 4: CAPITAL ASSETS

$ 1,198,576.54

Following are the changes in capital assets for the year ended June 30, 2019:

Beginning Balance July 1, 2018

Additions

Reductions

Ending Balance June 30, 2019

Capital Assets, Not Being Depreciated: Land Construction Work-In-Progress

$ 1,457,004.97 $ -

- $ 192,978.00

- $ 1,457,004.97

-

192,978.00

Total Capital Assets, Not Being Depreciated

1,457,004.97

192,978.00

-

1,649,982.97

Capital Assets, Being Depreciated: Building and Building Improvements Facilities and Other Improvements Equipment Library Collections Infrastructure

35,575,858.55 2,440,132.99 9,295,772.10 694,808.44 1,800,198.00

7,341.00 -
650,546.64 2,465.86 -

6,862.14 -

35,583,199.55 2,440,132.99 9,946,318.74 690,412.16 1,800,198.00

Total Assets Being Depreciated

49,806,770.08

660,353.50

6,862.14

50,460,261.44

Less: Accumulated Depreciation: Building and Building Improvements Facilities and Other Improvements Equipment Library Collections Infrastructure

11,719,118.39 1,967,173.36 8,123,857.26 513,895.21 112,512.38

975,331.16 43,613.53
679,920.14 45,554.96 90,009.90

6,862.14 -

12,694,449.55 2,010,786.89 8,803,777.40 552,588.03 202,522.28

Total Accumulated Depreciation Total Capital Assets, Being Depreciated, Net Capital Assets, Net

22,436,556.60

1,834,429.69

27,370,213.48

(1,174,076.19)

$ 28,827,218.45 $ (981,098.19) $

6,862.14

24,264,124.15

-

26,196,137.29

- $ 27,846,120.26

- 9 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

A comparison of depreciation expense for the last three fiscal years is as follows:

Fiscal Year

Depreciation Expense

2019 2018 2017

$ 1,834,429.69 $ 1,810,890.50 $ 2,002,440.77

NOTE 5: UNEARNED REVENUE (INCLUDING TUITION AND FEES)

Unearned Revenue (Including Tuitions and Fees) consisted of the following at June 30, 2019:

Current Liabilities

Prepaid Tuition and Fees

$ 827,029.75

NOTE 6: LONG-TERM LIABILITIES

The Institution's long-term liability activity for the year ended June 30, 2019 was as follows:

Leases

Lease Obligations

$

Other Liabilities

Compensated Absences

Net Pension Liability

Net Other Post Employment

Benefits Liability

Total Long-Term Obligations $

Beginning Balance July 1, 2018
121,652.00 $
1,160,186.34 17,214,632.00
16,144,527.00 34,640,997.34 $

Additions

Reductions

Ending
Balance June 30, 2019

Current Portion

- $ 104,355.94 $

17,296.06 $

6,940.25

878,214.12 -

880,618.80 545,650.00

1,157,781.66 16,668,982.00

659,935.55 -

-

6,173,961.00

9,970,566.00

-

878,214.12 $ 7,704,585.74 $ 27,814,625.72 $ 666,875.80

NOTE 7: NET POSITION

Changes in Net Position for the year ended June 30, 2019 are as follows:

Beginning Balance July 1, 2018

Additions

Reductions

Ending Balance June 30, 2019

Net Investment in Capital Assets $ 28,705,566.45 $

Restricted Net Position

297,645.69

Unrestricted Net Position

(31,836,477.80)

Total Net Position

$ (2,833,265.66) $

957,687.44 $ 13,922,450.55 18,976,926.25 33,857,064.24 $

1,834,429.69 $ 13,918,908.70 13,737,725.71 29,491,064.10 $

27,828,824.20 301,187.54
(26,597,277.26) 1,532,734.48

- 10 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

NOTE 8: LEASE OBLIGATIONS
The Institution is obligated under various capital and operating leases for the use of equipment.
CAPITAL LEASES
The Institution acquires certain equipment through multi-year capital leases with varying terms and options. In accordance with O.C.G.A. 50-5-64, these agreements shall terminate absolutely and without further obligation at the close of the fiscal year in which it was executed and at the close of each succeeding fiscal year for which it may be renewed. These agreements may be renewed only by a positive action taken by the Institution. In addition, these agreements shall terminate if the State does not provide adequate funding, but that is considered a remote possibility. The Institution's principal and interest payments related to capital leases for fiscal year 2019 were $104,355.94 and $5,016.67, respectively. Interest rates range from 9.2444% to 9.836%.
The following is a summary of the carrying values of assets held under capital lease at June 30, 2019:

Outstanding

Net Assets Held

Balances

Under Capital

per Lease

Accumulated

Lease at

Schedules at

Description

Gross Amount

Depreciation

June 30, 2019

June 30, 2019

(+)

(-)

(=)

Equipment

$

35,533.91 $

8,584.17 $

26,949.74 $

17,296.06

The following schedule lists the pertinent information for each of the Institution's capital leases:

Description

Lessor

Original Principal

Lease Term

Begin Date

End Date

Outstanding Principal

Equipment - Letter Folding Machine Equipment - Postage Meter

MailFinance $ Pitney Bowes

16,379.54 14,773.91

5 Years 5 Years

1/29/2016 1/28/2021 $ 12/30/2017 12/30/2022

6,228.00 11,068.06

Total Leases
OPERATING LEASES

$ 31,153.45

$ 17,296.06

The Institution leases office equipment. Some of these leases are considered for accounting purposes to be operating leases. Although lease terms vary, many leases are subject to appropriations from the General Assembly to continue the obligation. Other leases generally contain provisions that, at the expiration date of the original term of the lease, the Institution has the option of renewing the lease on a year-to-year basis. Leases renewed yearly for a specified time period, i.e. lease expires at 12 months and must be renewed for the next year, may not meet the qualification as an operating lease. The Institution's operating lease expense for the fiscal year 2019 was $115,249.04.

- 11 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

FUTURE COMMITMENTS
Future commitments for capital leases and for non-cancellable operating leases having remaining terms in excess of one year as of June 30, 2019, were as follows:

Year Ending June 30:

Capital Leases

Operating Leases

2020 2021 2022 2023

$

7,928.16 $ 172,873.56

5,852.16

172,873.56

3,776.16

172,873.56

1,888.08

57,624.52

Total Minimum Lease Payments

19,444.56 $ 576,245.20

Less: Interest

2,148.50

Principal Outstanding

$ 17,296.06

NOTE 9: RETIREMENT PLANS
The Institution participates in various retirement plans administered by the State of Georgia under two major retirement systems: Teachers Retirement System of Georgia (TRS) and Employees' Retirement System of Georgia (ERS). These two systems issue separate publicly available financial reports that include the applicable financial statements and required supplementary information. The reports may be obtained from the respective administrative offices.
The significant retirement plans that the Institution participates in are described below. More detailed information can be found in the plan agreements and related legislation. Each plan, including benefit and contribution provisions, was established and can be amended by State law.
Teachers Retirement System of Georgia and Employees' Retirement System of Georgia
General Information about the Teachers Retirement System
Plan description: All teachers of the Institution as defined in 47-3-60 of the Official Code of Georgia Annotated (O.C.G.A.) are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. TRS issues a publicly available financial report that can be obtained at www.trsga.com/publications.
Benefits provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.
- 12 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

Contributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6.00 % of their annual pay during fiscal year 2019. The Institution's contractually required contribution rate for the year ended June 30, 2019 was 20.90% of annual Institution payroll. Institution contributions to TRS were $1,124,392.46 for the year ended June 30, 2019.
General Information about the Employees' Retirement System
Plan description: ERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs.
Benefits provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS.
Under the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60.
Retirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension, at reduced rates, to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS.
Contributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200, plus 6% of annual compensation in excess of $4,200. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The Institution's contractually required contribution rate, actuarially determined annually, for the year ended June 30, 2019 was 24.78% of annual covered payroll for old and new plan members and 21.78% for GSEPS members. The rates include the annual actuarially determined employer contribution rate of 24.66% of annual covered payroll for old and new plan members and 21.66% for GSEPS members, plus a 0.12% adjustment for the HB751 one-time benefit adjustment of 3% to retired state employees. The Institution's contributions to ERS totaled $1,087,794.63 for the year ended June 30, 2019. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.
- 13 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2019, the Institution reported a liability for its proportionate share of the net pension liability for TRS and ERS totaling $16,668,982.00. The net pension liability was measured as of June 30, 2018. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2017. An expected total pension liability as of June 30, 2018 was determined using standard roll-forward techniques. The Institution's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2018. At June 30 2018, the Institution's TRS proportion was 0.049102%, which was an increase of 0.000849 % from its proportion measured as of June 30, 2017. At June 30, 2018, the Institution's ERS proportion was 0.183764%, which was a decrease of 0.019289% from its proportion measured as of June 30, 2017.

For the year ended June 30, 2019, the Institution recognized pension expense of $704,612.00 for TRS and $588,328.00 for ERS. At June 30, 2019, the Institution reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Differences between expected and actual experience
Changes of assumptions

TRS

Deferred Outflows of Resources

Deferred Inflows of Resources

ERS
Deferred Outflows of Resources

Deferred Inflows of Resources

$ 603,385.00 $

18,785.00 $ 234,962.00 $

-

137,533.00

-

355,918.00

-

Net difference between projected and actual earnings on pension plan investments

-

249,205.00

-

174,094.00

Changes in proportion and differences between Institution contributions and proportionate share of contributions
Instutution contributions subsequent to the measurement date

120,676.00 1,124,392.46

Total

$ 1,985,986.46 $

439,882.00

-

494,218.00

-

1,087,794.63

-

707,872.00 $ 1,678,674.63 $ 668,312.00

The Institution's contributions subsequent to the measurement date of $1,124,392.46 for TRS and $1,087,794.63 for ERS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

ERS

2020 2021 2022 2023 2024

$ 285,441.00 $ 133,918.00 $ (295,416.00) $ 18,222.00 $ 11,557.00

$ 252,530.00

$ 37,228.00

$ (289,403.00)

$ (77,787.00)

$

-

- 14 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

Actuarial assumptions: The total pension liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017 using the following actuarial assumptions, applied to all periods included in the measurement:
Teachers Retirement System:

Inflation Salary increases Investment rate of return

2.75% 3.25 9.00%, average, including inflation 7.50%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward on year for males) for service retirements and dependent beneficiaries. The RP-2000 Disability Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.
Employees' Retirement System

Inflation Salary increases Investment rate of return

2.75%
3.25 7.00%, including inflation 7.30%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. The RP-2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB and set back 7 years for males and set forward 3 years for females was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-12% less than the actual number of deaths that occurred during the study period for service retirements and beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.
The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.

- 15 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

The long-term expected rate of return on TRS and ERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of pension plan investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class
Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative
Total
* Rates shown are net of the 2.75% assumed rate of inflation

TRS Target allocation
30.00% 39.80%
3.70% 1.50% 19.40% 5.60%
-
100.00%

ERS Target allocation
30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%
100.00%

Long-term expected real rate of return*
(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50%

Discount rate: The discount rate used to measure the total TRS pension liability was 7.50% and ERS pension liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS and ERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the Institution's proportionate share of the net pension liability to changes in the discount rate: The following presents the Institution's proportionate share of the net pension liability calculated using the applicable discount rate, as well as what the Institution's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower or 1-percentage-point higher than the current rate:

Teachers Retirement System:
Institution's proportionate share of the net pension liability

1% Decrease (6.50%)

Current discount rate
(7.50%)

1% Increase (8.50%)

$ 15,214,515.00 $ 9,114,383.00 $ 4,087,564.00

Employees' Retirement System:
Institution's proportionate share of the net pension liability

1% Decrease
(6.30%)

Current discount rate
(7.30%)

1% Increase
(8.30%)

$ 10,745,308.00 $ 7,554,599.00 $ 4,836,033.00

- 16 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

Pension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS and ERS financial reports which are publicly available at www.trsga.com/publications and www.ers.ga.gov/formspubs/formspubs, respectively.
NOTE 10: RISK MANAGEMENT
Public Entity Risk Pool
The Department of Community Health administers for the State of Georgia a program of health benefits for the employees of units of government of the State of Georgia, units of county governments, and local education agencies located with the State of Georgia. This plan is funded by participants covered in the plan, by employers' contributions paid by the various units of government participating in the plan.
Other Risk Management
The Department of Administrative Services (DOAS) has the responsibility for the State of Georgia of making and carrying out decisions that will minimize the adverse effects of accidental losses that involve State government assets. The State believes it is more economical to manage its risks internally and set aside assets for claim settlement. Accordingly, DOAS processes claims for risk of loss to which the State is exposed, including general liability, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' indemnification. Limited amounts of commercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks. The Institution, as an organizational unit of the Technical College System of Georgia, is part of the State of Georgia reporting entity, and as such, is covered by the State of Georgia risk management program administered by DOAS. Premiums for the risk management program are charged to the various state organizations by DOAS to provide claims servicing and claims payment.
NOTE 11: CONTINGENCIES
Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. This could result in refunds to the grantor agency for any expenditure disallowed under grant terms. The amount of expenditures which may be disallowed by the grantor cannot be determined at this time although the Institution expects such amounts, if any, to be immaterial to its overall financial position.
Litigation, claims and assessments filed against the Institution (an organizational unit of the Technical College System of Georgia), if any, are generally considered to be actions against the State of Georgia. Accordingly, significant litigation, claims and assessments pending against the State of Georgia are disclosed in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 2019.

- 17 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

NOTE 12: POST-EMPLOYMENT BENEFITS OTHER THAN PENSION BENEFITS
Georgia State Employees Post-Employment Health Benefit Fund (State OPEB Fund)
General Information about the State OPEB Fund
Plan description: - Employees of State organizations as defined in 45-18-25 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the State OPEB Fund - a cost-sharing multipleemployer defined benefit postemployment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 45 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board.
Benefits provided: The State OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for employees of State organizations (including technical colleges) and other entities authorized by law to contract with Department of Community Health (DCH) for inclusion in the plan. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The State OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the State OPEB Fund is permitted.
Contributions: As established by the Board, the State OPEB Fund is substantially funded on a pay-asyou-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the State OPEB Fund from the Institution were $1,919,988.00 for the year ended June 30, 2019. Active employees are not required to contribute to the State OPEB Fund.
OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
At June 30, 2019, the Institution reported a liability of $9,970,566.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2018. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2017. An expected total OPEB liability as of June 30, 2018 was determined using standard roll-forward techniques. The Institution's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2018. At June 30, 2018, the Institution's proportion was 0.381198%, which was a decrease of 0.015064 % from its proportion measured as of June 30, 2017.

- 18 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

For the year ended June 30, 2019, the Institution recognized OPEB expense of $836,922.00. At June 30, 2019, the Institution reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Deferred Outflows of Resources

OPEB

Deferred Inflows of Resources

Difference between expected and actual

experience

$

-

$

784,186.00

Changes of assumptions

-

3,614,177.00

Net difference between projected and actual

earnings on pension plan investments

230,473.00

-

Changes in proportion and differences between Institution contributions and proportionate share of contributions

-

847,383.00

Institution contributions subsequent to the

measurement date

1,919,988.00

-

Total

$ 2,150,461.00 $ 5,245,746.00

The Institution's contributions subsequent to the measurement date of $1,919,988.00 are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended June 30:

OPEB

2020 2021 2022 2023

$ (1,653,675.00) $ (1,653,675.00) $ (1,322,909.00) $ (385,014.00)

- 19 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

Actuarial assumptions: The total OPEB liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2018:

Inflation Salary increases Long-term expected rate of return Healthcare cost trend rate
Pre-Medicare Eligible Medicare Eligible Ultimate trend rate Pre-Medicare Eligible Medicare Eligible Year of Ultimate trend rate Pre-Medicare Eligible Medicare Eligible

2.75% 3.25% - 7.00%, including inflation 7.30%, compounded annually, net of investment expense, and including inflation 7.50% 5.50%
4.75% 4.75%
2028 2022

Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows:
For ERS, JRS and LRS members: The RP-2000 Combined Mortality Table projected to 2025 with projection scale BB and set forward 2 years or both males and females is used for the period after service retirement and for dependent beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB and set back 7 years for males and set forward 3 years for females is used for the period after disability retirement.
For TRS members: The RP-2000 White Collar Mortality Table projected to 2025 with projection scale BB (set forward 1 year for males) is used for death after service retirement and beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females) is used for death after disability retirement.
The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2014.
The remaining actuarial assumptions (e.g. initial per capita costs, health care cost trends, rate of plan participation, rates of plan election, etc.) used in the June 30, 2017 valuation were based on a review of recent plan experience done concurrently with the June 30, 2017 valuation.
Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation.
- 20 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset Class
Fixed Income Domestic Stocks - Large Cap Domestic Stocks - Mid Cap Domestic Stocks - Small Cap Int'l Stocks - Developed Mkt Int'l Stocks - Emerging Mkt Alternatvies

Target allocation
30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%

Long-term expected real rate of return *
(0.05)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50%

Total

100.00%

* Rates shown are net of inflation.
Discount rate: The discount rate has changed since the prior measurement date from 3.60% to 5.22%. In order to measure the total OPEB liability for the State OPEB Fund, a single equivalent interest rate of 5.22% was used as the discount rate. This is comprised mainly of the yield or index rate for twentyyear tax-exempt general obligation municipal bonds with an average rating of AA or higher (3.87% per the Bond Buyers Index). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2118. Based on these assumptions, the OPEB plan's fiduciary net position was projected to be available to make OPEB payments for inactive employees through year 2040. Therefore, the calculated discount rate of 5.22% was applied to all periods of projected benefit payments to determine the total OPEB liability.
Sensitivity of the Institution's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the Institution's proportionate share of the net OPEB liability calculated using the discount rate of 5.22%, as well as what the Institution's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (4.22%) or 1-percentage-point higher (6.22%) than the current discount rate:

Proportionate Share of the

Net OPEB Liability

$

1% Decrease 4.22%
11,845,384.00 $

Current Rate 5.22%
9,970,566.00 $

1% Increase 6.22%
8,421,621.00

- 21 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

Sensitivity of the Institution's proportionate share of the net OPEB liability to changes in the healthcare cost trend rates: The following presents the Institution's proportionate share of the net OPEB liability,
as well as what the Institution's proportionate share of the net OPEB liability would be if it were
calculated using healthcare cost trend rates that are 1-percentage-point lower or 1-percentage-point
higher than the current healthcare cost trend rates:

Proportionate Share of the Net OPEB Liability

1% Decrease

$

8,225,016.00 $

OPEB plan fiduciary net position

Current Rate 9,970,566.00 $

1% Increase 12,105,438.00

Detailed information about the OPEB plan's fiduciary net position is available in the Comprehensive
Annual Financial Report (CAFR) which is publicly available at https://sao.georgia.gov/comprehensiveannual-financial-reports.

Postemployment Benefits Other Than Pensions (SEAD OPEB)
General Information about the SEAD-OPEB Fund
Plan Description: SEAD-OPEB was created in 2007 by the Georgia General Assembly to amend Title 47 of the O.C.G.A., relating to retirement, so as to establish a fund for the provision of term life insurance to retired and vested inactive members of the Employees' Retirement System of Georgia (ERS), the Legislative Retirement System (LRS), and the Georgia Judicial Retirement System (GJRS). The plan is a cost-sharing multiple-employer defined benefit other postemployment benefit plan as defined in Governmental Accounting Standards Board (GASB) Statement No. 74, Financial Reporting for Postemployment Benefit Plans other than OPEB Plans. The SEAD-OPEB trust fund accumulates the premiums received from the aforementioned retirement plans, including interest earned on deposits and investments of such payments.

Benefits Provided: The amount of insurance for a retiree with creditable service prior to April 1, 1964 is the full amount of insurance in effect on the date of retirement. The amount of insurance for a service retiree with no creditable service prior to April 1, 1964 is 70% of the amount of insurance in effect at age 60 or at termination, if earlier. Life insurance proceeds are paid in a lump sum to the beneficiary upon death of the retiree.

Contributions: Georgia law provides that employee contributions to the plan shall be in an amount established by the Board of Trustees not to exceed one-half of one percent of the member's earnable compensation. There were no employer contributions required for the fiscal year ended June 30, 2019.

OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
At June 30, 2019, the Institution reported an asset of $285,320.00 for its proportionate share of the net OPEB asset. The net OPEB asset was measured as of June 30, 2018. The total OPEB asset used to calculate the net OPEB asset was based on an actuarial valuation as of June 30, 2017. An expected total OPEB asset as of June 30, 2018 was determined using standard roll-forward techniques. The Institution's proportion of the net OPEB asset was based on actual member salaries reported to the SEAD-OPEB plan during the fiscal year ended June 30, 2018. At June 30, 2018, the Institution's proportion was 0.105422%, which was a decrease of 0.002424 % from its proportion measured as of June 30, 2017.

- 22 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

For the year ended June 30, 2019, the Institution recognized a credit to OPEB expense of $9,432.00. At June 30, 2019, the Institution reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Differences between expected and actual experience

SEAD-OPEB

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

$

3,117.00 $

-

Changes of assumptions
Net difference between projected and actual earnings on OPEB plan investments

14,659.00 -

47,169.00

Changes in proportion and differences between contributions and proportionate share of contributions

Total

$

15,748.00 33,524.00 $

47,169.00

Amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended June 30:

SEAD-OPEB

2020 2021 2022 2023

$

10,414.00

$

(5,708.00)

$ (14,410.00)

$

3,941.00

Actuarial assumptions: The total OPEB asset as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement:

Inflation Salary increases:
ERS GJRS LRS Investment rate of return

2.75%
3.25% 7.00% 4.50% N/A 7.30%, net of OPEB plan investment expense, including inflation

- 23 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

Postretirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward two years for both males and females for service retirements and dependent beneficiaries. There is a margin for future mortality improvement in the tables used by the plan.

The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.

The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of plan investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class
Fixed income Domestic large equities Domestic mid equities Domestic small equities International developed market equities International emerging market equities Alternatives
Total

Target allocation
30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%
100.00%

Long-term expected real rate of return*
(0.50)% 9.00%
12.00% 13.50%
8.00% 12.00% 10.50%

* Rates shown are net of inflation
Discount rate: The discount rate used to measure the total OPEB liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the OPEB plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability.

Sensitivity of the Institution's proportionate share of the net OPEB asset to changes in the discount rate: The following presents the Institution's proportionate share of the net OPEB asset calculated
using the discount rate of 7.30%, as well as what the Institution's proportionate share of the net OPEB
asset would be if it were calculated using a discount rate that is one-percentage-point lower (6.30%)
or one-percentage-point higher (8.30%) than the current rate:

1% Decrease (6.30%)

Current Discount Rate
(7.30%)

1% Increase (8.30%)

Net OPEB Asset

$

(153,730.00) $

(285,320.00) $

(393,181.00)

- 24 -

ALBANY TECHNICAL COLLEGE SELECTED FINANCIAL NOTES
JUNE 30, 2019

EXHIBIT "D"

OPEB plan fiduciary net position
Detailed information about the OPEB plan's fiduciary net position is available in the separately issued ERS comprehensive annual financial report which is publicly available at www.ers.ga.gov/financials.
NOTE 13: EXTRAORDINARY ITEM
The Institution received $650,000.00 in insurance recoveries for the damages to the Carlton Construction Academy and miscellaneous other damages to the campus caused by Hurricane Michael on October 10, 2018.

- 25 -

SUPPLEMENTARY INFORMATION - 26 -

ASSETS
Cash and Cash Equivalents Accounts Receivable
Federal Financial Assistance Other Prepaid Expenditures Inventories

ALBANY TECHNICAL COLLEGE BALANCE SHEET (STATUTORY BASIS)
BUDGET FUND JUNE 30, 2019

Total Assets

LIABILITIES AND FUND EQUITY
Liabilities Accrued Payroll Encumbrance Payable Accounts Payable Unearned Revenue Funds Held for Others
Total Liabilities
Fund Balances Reserved Refunds to Grantors Federal Financial Assistance Live Work Projects Prior Year Local Funds Continuing Education Technology Fees Uncollectible Accounts Receivable Inventories Bookstore Tuition Unreserved Surplus
Total Fund Balances

Total Liabilities and Fund Balances

SCHEDULE "1"

$

2,552,802.83

589,584.12 703,343.35
11,708.82 176,713.19

$

4,034,152.31

$

52,030.32

1,265,514.36

464,140.25

809,369.17

14,185.15

2,605,239.25

9,788.13 6,079.41 261,521.18 10,194.29 50,728.72 308,032.02 82,507.88 58,000.00 3,517.47 625,750.80
12,793.16
1,428,913.06

$

4,034,152.31

Statutory Basis financial information was prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.
- 27 -

ALBANY TECHNICAL COLLEGE SUMMARY BUDGET COMPARISON SURPLUS ANALYSIS REPORT (STATUTORY BASIS)
BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30, 2019

SCHEDULE "2"

REVENUES
State Appropriation State General Funds
Federal Funds Other Funds
Total Revenues
CARRY-OVER FROM PRIOR YEAR
Transfer from Reserved Fund Balance
Total Funds Available
EXPENDITURES
Adult Literacy Technical Education Workforce Development Economic Development
Total Expenditures

BUDGET

ACTUAL

VARIANCE FAVORABLE (UNFAVORABLE)

$

11,964,309.00 $

11,964,309.00 $

3,215,278.82

2,965,968.33

12,343,979.03

11,574,164.52

(249,310.49) (769,814.51)

27,523,566.85

26,504,441.85

(1,019,125.00)

27,523,566.85

319,377.82 26,823,819.67

319,377.82 (699,747.18)

1,152,963.00 25,744,716.76
59,646.00 566,241.09
27,523,566.85

1,094,982.88 23,841,061.67
495,163.61
25,431,208.16

57,980.12 1,903,655.09
59,646.00 71,077.48
2,092,358.69

Excess of Funds Available over Expenditures
FUND BALANCE JULY 1
Reserved Unreserved
ADJUSTMENTS
Prior Year Payables/Expenditures Prior Year Receivables/Revenues Unreserved Fund Balance (Surplus) Returned
to Technical College System of Georgia Year Ended June 30, 2018
Refunds to Grantors Federal Financial Assistance Returned to Technical College System of Georgia Year Ended June 30, 2018
Prior Year Reserved Fund Balance Included in Funds Available

$

-

1,392,611.51 $

1,392,611.51

441,626.85 1,606.06

68,659.48 (152,643.31)
(1,606.06)

(1,963.65) (319,377.82)

FUND BALANCE JUNE 30
SUMMARY OF FUND BALANCE
Reserved Refunds to Grantors Federal Financial Assistance Live Work Projects Prior Year Local Funds Continuing Education Technology Fees Uncollectible Accounts Receivable Inventories Bookstore Tuition
Total Reserved
Unreserved Surplus

$

1,428,913.06

$

9,788.13

6,079.41

261,521.18

10,194.29

50,728.72

308,032.02

82,507.88

58,000.00

3,517.47

625,750.80

1,416,119.90

12,793.16

Total Fund Balance

$

1,428,913.06

Statutory Basis financial information was prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.
- 28 -

(This page left intentionally blank)

ALBANY TECHNICAL COLLEGE STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE
(STATUTORY BASIS) BUDGET FUND YEAR ENDED JUNE 30, 2019

Adult Literacy State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified Other Funds
Total Adult Literacy
Quick Start Other Funds
Technical Education State Appropriations State General Funds Federal Funds Federal Funds Not Specifically Identified Other Funds
Total Technical Education
Workforce Development Other Funds
Economic Development Other Funds
Totals by Program

Original Appropriation

Amended Appropriation

Final Budget

Current Year Revenues

$

510,300.00 $

502,515.00 $

502,515.00 $

502,515.00

408,160.00 426,133.00

400,000.00 240,000.00

408,160.00 242,288.00

406,395.24 193,817.94

1,344,593.00

1,142,515.00

1,152,963.00

1,102,728.18

626,773.00

-

-

-

11,261,708.00 3,331,342.00
12,438,735.00 27,031,785.00
-
-

11,461,794.00 2,807,118.82
11,475,803.94 25,744,716.76
-
566,240.00

11,461,794.00 2,807,118.82
11,475,803.94 25,744,716.76
59,646.00
566,241.09

11,461,794.00 2,559,573.09
10,836,119.31 24,857,486.40
-
544,227.27

$ 29,003,151.00 $ 27,453,471.76 $ 27,523,566.85 $ 26,504,441.85

Statutory Basis financial information was prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.
- 30 -

SCHEDULE "3"

Funds Available Compared to Budget

Prior Year Carry-Over

Adjustments and Program Transfers

Total Funds Available

Variance Positive (Negative)

Expenditures Compared to Budget

Variance

Actual

Positive

Excess of Funds Available
Over Expenditures

$

- $

-

-

-

- $ -
-

502,515.00 $
406,395.24 193,817.94
1,102,728.18

- $
(1,764.76) (48,470.06)
(50,234.82)

498,872.16 $
402,292.78 193,817.94
1,094,982.88

-

-

-

3,642.84 $ 5,867.22 48,470.06 57,980.12
-

3,642.84 4,102.46
7,745.30
-

15,347.48 304,030.34 319,377.82
-
-
$ 319,377.82 $

-

11,461,794.00

-

11,461,794.00

-

-

2,574,920.57

(232,198.25)

2,488,807.43

318,311.39

-

11,140,149.65

(335,654.29)

9,890,460.24

1,585,343.70

-

25,176,864.22

(567,852.54)

23,841,061.67

1,903,655.09

-

-

(59,646.00)

-

59,646.00

-

544,227.27

(22,013.82)

495,163.61

71,077.48

86,113.14 1,249,689.41 1,335,802.55
-
49,063.66

- $

26,823,819.67 $ (699,747.18) $ 25,431,208.16 $

2,092,358.69 $

1,392,611.51

- 31 -

ALBANY TECHNICAL COLLEGE STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE
(STATUTORY BASIS) BUDGET FUND YEAR ENDED JUNE 30, 2019

Adult Literacy State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified Other Funds
Total Adult Literacy
Technical Education State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified Other Funds
Total Technical Education
Economic Development Other Funds
Total Operating Activity
Prior Year Reserves Not Available for Expenditure Inventories Refunds to Grantors Uncollectible Accounts Receivable

Beginning Fund Balance July 1

Fund Balance Carried Over from
Prior Period as Funds Available

Return of Fiscal Year 2018
Surplus

Prior Period Adjustments

$

1,605.07 $

-

1,605.07

- $
-
-

(1,605.07) $
-
(1,605.07)

10,755.39
5,448.39 1,489.91
17,693.69

15,347.48 304,031.33 319,378.81
320,983.88

(15,347.48) (304,030.34) (319,377.82)
(319,377.82)

-
(0.99)
(0.99)

0.03
(80,177.98) (23,164.63)
(103,342.58)

.
(1,606.06)

1,665.06 (83,983.83)

58,000.00 2,001.21
62,247.82

-

-

-

-

-

-

-

-

-

Totals by Program

$

443,232.91 $

(319,377.82) $

(1,606.06) $

(83,983.83)

Statutory Basis financial information was prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.
- 32 -

SCHEDULE "4"

Other Adjustments

Early Return of Fiscal Year 2019
Surplus

Excess of Funds Available
Over Expenditures

Ending Fund Balance June 30

Analysis of Ending Fund Balance

Fiscal Year 2019

Reserved

Surplus

Total

$ (1,605.07) $
(9,550.85) (1,489.91)
(12,645.83)

- $
-
-

3,642.84 $
4,102.46 -
7,745.30

12,793.16 $
-
12,793.16

- $
-
-

12,793.16 $
-
12,793.16

12,793.16
-
12,793.16

(0.03) 144.25 (17,509.02) (17,364.80)
(30,010.63)

-

-

-

-

-

86,113.14

6,079.41

6,079.41

-

1,249,689.41

1,209,015.76

1,209,015.76

-

1,335,802.55

1,215,095.17

1,215,095.17

-

-

-

6,079.41

-

1,209,015.76

-

1,215,095.17

-

49,063.66

50,728.72

50,728.72

-

50,728.72

-

1,392,611.51

1,278,617.05

1,265,823.89

12,793.16

1,278,617.05

-

-

7,786.92

-

20,260.06

-

-

58,000.00

58,000.00

-

9,788.13

9,788.13

-

82,507.88

82,507.88

-

58,000.00

-

9,788.13

-

82,507.88

$ (1,963.65) $

- $

1,392,611.51 $ 1,428,913.06 $ 1,416,119.90 $

12,793.16 $ 1,428,913.06

Summary of Ending Fund Balance Reserved
Refunds to Grantors Federal Financial Assistance Live Work Projects Prior Year Local Funds Continuing Education Technology Fees Uncollectible Accounts Receivable Inventories Bookstore Tuition Unreserved Surplus
Total Ending Fund Balance - June 30

$

9,788.13 $

6,079.41

261,521.18

10,194.29

50,728.72

308,032.02

82,507.88

58,000.00

3,517.47

625,750.80

-

$ 1,416,119.90 $

- $ -
12,793.16
12,793.16 $

9,788.13 6,079.41 261,521.18 10,194.29 50,728.72 308,032.02 82,507.88 58,000.00 3,517.47 625,750.80
12,793.16
1,428,913.06

- 33 -

SECTION II ENTITY'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

ALBANY TECHNICAL COLLEGE ENTITY'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2019
PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
No matters were reported.
PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.

SECTION III FINDINGS, QUESTIONED COSTS AND OTHER ITEMS

ALBANY TECHNICAL COLLEGE SCHEDULE OF FINDINGS, QUESTIONED COSTS AND OTHER ITEMS
YEAR ENDED JUNE 30, 2019

COMMUNICATION OF INTERNAL CONTROL DEFICIENCIES

The auditor is required to communicate to management and those charged with governance control deficiencies identified during the course of the financial statement audit that, in the auditor's judgment, constitute significant deficiencies or material weakness.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Internal control deficiencies identified during the course of this engagement that were considered to be significant deficiencies and/or material weaknesses are presented below:

FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

No matters were reported.

FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

FA 2019-001

Strengthen Controls over Enrollment Reporting

Compliance Requirement: Internal Control Impact: Compliance Impact: Federal Awarding Agency: Pass-Through Entity: CFDA Numbers and Titles:
Federal Award Numbers:
Questioned Costs:

Special Tests and Provisions Significant Deficiency Nonmaterial Noncompliance U.S. Department of Education None 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study Program 84.063 Federal Pell Grant Program 84.268 Federal Direct Student Loans P007A180951 (Year: 2019), P033A180951 (Year: 2019), P063P182748 (Year: 2019), P268K192748 (Year: 2019) None Identified

Description: Changes in student enrollment statuses were not reported to required organizations in a timely and accurate manner.

Criteria: Regarding the enrollment reporting process, provisions included in 34 CFR 685.309(b) state in part "(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that (i) ... the student has ceased to be enrolled on at least a half-time basis for the period."

- 1 -

ALBANY TECHNICAL COLLEGE SCHEDULE OF FINDINGS, QUESTIONED COSTS AND OTHER ITEMS
YEAR ENDED JUNE 30, 2019
FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
Condition: A sample of 40 students who withdrew from the Institution during the Fall 2018 and Spring 2019 semesters and for whom a Return of Title IV funds calculation was completed was randomly selected for testing using a non-statistical sampling method. The National Student Loan Data System (NSLDS) Enrollment Detail was reviewed for each student to ensure that the correct enrollment status was reflected, and the enrollment status was updated within the appropriate timeframe. In six instances, the student's withdrawn enrollment status was never reported to NSLDS. Additionally, in 14 instances, the student's withdrawn enrollment status was reported to NSLDS in an untimely manner.
Cause: In discussing these deficiencies with management, they stated that for students who had failing or incomplete grades reported but had ceased attendance, the overall enrollment status was being updated; however, the enrollment status for each course was not being updated. This error caused the omissions and untimely updates in NSLDS enrollment reporting performed.
Effect or Potential Effect: If enrollment statuses are not submitted appropriately to NSLDS by the Institution, loan interest subsidies may be negatively affected, deferments of Federal Direct Loans may be continued in error, loan repayment dates could be recorded incorrectly, and the compilation of data associated with other Title IV aid programs can be adversely affected. Additionally, the Institution was not in compliance with Federal regulations concerning enrollment reporting requirements.
Recommendation: The Institution should implement policies and procedures to ensure that all changes in student enrollment statuses are reported in a timely manner. Additionally, management should develop and implement a monitoring process to ensure that controls are operating properly.
Views of Responsible Officials: We concur with this finding.
OTHER ITEMS (NOTED FOR MANAGEMENT'S CONSIDERATION)
Logical Access IT General Controls
Observation: Our review of the established internal control structure associated with the student information system at the Institution revealed design deficiencies in logical access controls intended to protect information from unauthorized access, manipulation and corruption. The details related to these deficiencies have been provided to management of the Institution in accordance with Official Code of Georgia Annotated 50-6-9.
Recommendation: Management should review and enhance their policies and procedures to ensure the integrity and accuracy of the information used as part of awarding financial assistance to students. Additionally, management should ensure proper separation of duties as it relates to student financial assistance processes.
- 2 -

ALBANY TECHNICAL COLLEGE SCHEDULE OF FINDINGS, QUESTIONED COSTS AND OTHER ITEMS
YEAR ENDED JUNE 30, 2019
OTHER ITEMS (NOTED FOR MANAGEMENT'S CONSIDERATION)
Management's Response: All system accounts previously assigned to the DEFAULT profile have been reassigned. Any non-system accounts would be subject to Active Directory password controls regardless of the profile assigned. TCSG Enterprise Services will conduct a review to ensure that no non-system users are subject to any direct grants to database objects.
Contact Person: Kathleen Skates, Vice President of Administrative Services/ Bruce Hopkins, Director of Information Technology Telephone: 229-430-3524 / 229-430-2837 E-mail: kskates@albanytch.edu
Excessive Cash Balances
Observation: Upon review of cash drawdowns, disbursements, and subsequent adjustments related to the Federal Direct Student Loans program and the Federal Pell Grant program, excessive cash balances were noted for up to 12 days and 18 days, respectively, in the fiscal year. Provisions included in 34 CFR 668.166(a) state, "The Secretary considers excess cash to be any amount of Title IV, HEA program funds, other than Federal Perkins Loan Program funds, that an institution does not disburse to students or parents by the end of the third business day following the date the institution received those funds from the Secretary."
Recommendation: The Institution should enhance procedures to ensure that Federal Direct Student Loan and Federal Pell Grant funds reversed within the student information system due to the processing of Return of Title IV calculations are returned in a timely manner. In addition, the Institution should only request Federal Direct Student Loan and Federal Pell Grant funds when the amounts are immediately needed to disburse funds to students or parents. Furthermore, the Institution should develop and implement a monitoring process to ensure that controls are functioning appropriately.
Management's Response: The Technical College will reserve local funding in an amount in G5 to handle fluctuations due to Return of Title IV and reductions in student awards. We are working with our Financial Aid Department to ensure compliance with the applicable cash management regulations.
Contact Person: Kathleen Skates, Vice President of Administrative Services Telephone: 229-430-3524 E-mail: kskates@albanytch.edu
Return of Title IV Funds
Observation: Our review of a sample of 40 students to test the Institution's compliance with 34 CFR 668.22, which is related to the return of Title IV funds, revealed that the proration between the school and student portion of the refund was incorrect for one student. Additionally, funds were not returned to the appropriate grantor programs within the required time frame of 45 days for nine of the withdrawn students tested.
- 3 -

ALBANY TECHNICAL COLLEGE SCHEDULE OF FINDINGS, QUESTIONED COSTS AND OTHER ITEMS
YEAR ENDED JUNE 30, 2019 OTHER ITEMS (NOTED FOR MANAGEMENT'S CONSIDERATION) Recommendation: The Institution should revise and implement procedures to ensure that student financial aid refunds are properly calculated and that unearned funds are correctly returned to the appropriate accounts in a timely manner in accordance with the Higher Education Amendments 1998, Public Law 105-244. Management's Response: The Technical College will check each record's number of days calculation instead of a random selection of records for the number of days calculated by Banner. We have also turned off the check mark to include the Late Fee as an Institutional Charge. The Financial Aid, Registrar's, and Academic Affairs Offices will continue to work together to have withdrawals reported more timely. Also, the Financial Aid Office and the Registrar will process the list of students with no earned credit more expeditiously after grades roll. Contact Person: Helen Catt, Director of Financial Aid Telephone: 229-430-6159 E-mail: hcatt@albanytech.edu
- 4 -

SECTION IV MANAGEMENT'S CORRECTIVE ACTION