Clayton State University, Morrow, Georgia, independent accountant's report on applying agreed-upon procedures for fiscal year ended June 30, 2011

CLAYTON STATE UNIVERSITY
MORROW, GEORGIA
INDEPENDENT ACCOUNTANT'S
REPORT ON A P P L m G AGREED-
UPON PROCEDURES
FOR mscm YEAR ENDED
JUNE 30,2011
4 Georgia Department
I , Audits andBccorurtsl
w , - I . - d
Russell W.Hinton
State Au&tc

CLAYTON STATE UNIVERSITY - TABLE OF CONTENTS -

INDEPENDENT ACCOUNTANT'S REPORT ON APPLYING AGREED-UPON PROCEDURES
EXHIBITS
A SUMMARY BUDGET COMPARISON AND SURPLUS ANALYSIS REPORT
B STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE
C STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE

Page

RUSSELLW. HINTON
STATE AUDITOR
(404)666-2174

DEPARTMENOTF AUDITSAND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
January 10,2012

Members of the State Board of Regents of the University System of Georgia
and Honorable Tim Hynes, President Clayton State University
lnde~endenAt ccountant's R e ~ o rotn ADD~v~M~rEe!ed-Upon Procedures
Ladies and Gentlemen:
We have performed the procedures enumerated below, which were agreed to by the University and the University System Office (Oversight Unit) of the Board of Regents of the University System of Georgia, solely to assist you in assessing the accuracy of the financial information reported to the University System Office in the University's 2011 Annual Financial Report for inclusion in the University System of Georgia's Annual financial RepoH, the State of Georgia's ComprehensiveAnnual financial Report (G4FR) and Single Audit Report and to assist you in assessing the accuracy of the budget basis information provided in the Summa~yBudget Comparison and Surplus Analysis ReporC, Statement of Funds Available and Expenditures Compared to Budget By Program and Funding Source,
and the Statement of Changes To Fund Balance 8).Program and Funding S o u ~ wehich are attached as
Exhibits A, B and C, respectively. Clayton State University's management is responsible for the financial information reported to the University System Office in the University's Annual Financial Report. This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of the parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose.
The procedures and the associated findings are as follows:
1. Review selected balance sheet items reported on the Annual Financial Report (cash, accounts receivable, accounts payable, deferred revenues, net assets). Confirm that these items have adequate supporting documentation and are properly reconciled to the University's general ledger.
We dld not note any exceptions as a result of our procedures.

2. Obtain the University's GAAP basis Statement of Net Assets and Statement of Revenues, Expenses and Changes in Net Assets (SRECNA) submitted for inclusion in the State's CAFR and Single Audit. Utilizing test scripts, confirm that financial information presented in these statements properly supports activity reported in the University's accounting records.
- On the SRECNA, Net Assets Beginning of Year (FY11) did not agree to Net Assets
End of Year (FY10) on the SRECNA by $2,017,725. The variance was due to post closing entries made directly to the Financial Statements by the University in FY10.
- An adjustment to Net Assets Beginningof Year and Supplies and Other Sewices
was proposed and accepted to correct this item.
3. Obtain the University's Statement of Cash Flows submitted for inclusion in the State's CAFR and Single Audit. Utilizing cash flow worksheets, confirm information reported on Statement of Cash Flows.
We did not note any exceptions as a resultof our procedures.
4. Obtain the University's Notes to the Financial Statements submitted for inclusion in the State's CAFR and Single Audit. Utilizing notes worksheets and other supporting documentation confirm that note disclosures related to Cash, Investments, Accounts Receivable, Capital Assets, LongTerm Debt, Lease Obligations and Retirement Plans have been properly reported.
We did not note any exceptions as a result of our procedures.
5. Review t h e University's year end GAAP basis journal entries. Obtain documentation for GAAP journal entries and confirm that t h e entries were posted t o the University's Annual Financial Report.
We did not note any exceptions as a result of our procedures.
6. Confirm that State Appropriation revenues, receivables and remittances of prior year surplus balances have been properly recorded in the University's financial records. Prior year surplus balances should be netted against State Appropriation revenues in the GAAP basis financial statements; however, prior year surplus balances should be reflected as fund balance adjustments on the Budget basis financial statements.
We did not note any exceptions as a result of our procedures.
7. Obtain listing of write-off requests for accounts receivable less than $3,000.00 for fiscal year 2011. Confirm that these write-off requests have been approved by the State Accounting Officer and have been posted to the University's financial statements.
We did not note any exceptions as a result of our procedures.
8. Verify that the listing of salaries and travel reported to the Department of Audits is in accordance with O.C.G.A. 50-6-27 and reconciles to amounts recorded in the University's financial statements.
Travel amounts reported to the Department of Audits were not reconciled with amounts recorded in the financial statements. A variance of $2,234.45, relatedto a misclassification between expenditure accounts on the SRECNA, was noted. Travel amounts reported to the Department of Audits were found to be correct and did not require adjustment

9. Review year end Budgetary Statements including the Summary Budget Comparison and SUMUS Analysis Report(Exhibit A), Statement of Funds Avajlable and Expenditures Ompared lv Budget By Program and Funding Source (Exhibit B ) and the Statement of Changes To Fund Balance By Progam and Funding Source (Exhibit C). Confirm that budget information presented in these statements supports activity reported in the University's accounting records and determine if any budget overexpenditures exist.
We noted several problems during our review of the Budgetary Statements. As a
result of these problems, various balances were incorrect, includingSurplus. Auditor made the necessary adjustments to the Budgetary Statements to correctly present BeginningFund Balanceand Surplus.
10. Obtain documentation for Budget basis reserves reported by University on the Summary Budget Comparjison and Sumus Analysis Report (Exhibit A). Confirm that the reserves are properly documented, valid and appropriate.
We did not note any exceptionsas a resultof our procedures.
11. Review the H.O.P.E. Scholarship Program reconciliation between the University and the Georgia Student Finance Commission. Confirm that information reported to the Georgia Student Finance Commission has been reconciled with H.O.P.E. Scholarship activity reported on the University's financial records.
We did not note any exceptions as a result of our procedures.
12. Review the Schedule of Expenditures of Federal Awards information submitted by the University for inclusion in the Statewide Single Audit. Confirm that the information is properly presented and supported by the University's accounting records.
We did not note any exceptions as a result of our procedures.
13. Review capital asset records to ensure that (1) subsidiary ledgers are appropriately reconciled to the ledgers, (2) capitalization thresholds are being properly followed, and (3)a complete annual physical equipment inventory is being conducted and that issues noted during the physical inventory are being properly addressed by management.
We did not note any exceptions as a result of our procedures.
14. Review bank reconciliations during the year under review to ensure that management is preparing them timely and that reconciling items are being addressed by management timely and in an appropriate manner.
We did not note any exceptions as a result of our procedures.
15. Review documentation to ensure that all subsidiary modules including BANNER are reconciled to the general ledger a t least quarterly in accordance with the Business Procedures Manual Section 10.6.2. and ensure that reconciling items are adequately explained and resolved in a timely manner.
We did not note any exceptions as a result of our procedures.

These agreed-upon procedures do not constitute an audit of the financial statements or any part thereof, the objective of which is to express an opinion on the financial statements or a part thereof. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.
This report is intended solely for the information and use of the specified users listed above and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
Russell W. Hinton, CPA, CGFM State Auditor

EXH IBlTS

CLAYTON STATE UNIVERSITY SUMMARY BUDGET COMPARISON AND SURPLUS ANALYSIS REPORT
YEAR ENDED JUNE 3 0 . 2 0 1 1

REVENUES
State Appropriation State General Funds
Other Funds
Total Revenues
ADJUSTMENTS AND PROGRAM TRANSFERS
CARRY-OVER FROM PRIOR YEARS
Transfers from Reserved Fund Balance
Total Funds Available
EXPENDITURES
Special Funding Initiative Teachlng
Total Expendttures Excess of Funds Available over Expenditures
FUND BALANCE JUI Y 1
Reserved Unreserved
ADJUSTMENTS
Prior Year Payables/Expenditures Unreserved Fund Balance (Surplus) Returned
to Board of Regents - Universify System Office Year Ended June 3 0 . 2 0 1 0
Early Return of Surplus in Current Fiscal Year Prior Year Reserved Fund Balance Included in Funds Ava~lable FUND BALANCE JUNE 3 0
SUMMARY OF FUND BALANCE
Reserved Department Sales and Services Indirect Cost Recoveries Technology Fees Uncollectible Accounts Rece~vable Tuition Carry-Over
Total Reserved
Unreserved Surplus
Total Fund Balance

BUDGET

ACTUAL

VARIANCE FAVORABLE (UNFAVORABLE)

CLAYTON STATE UNIVERSITY STATEMENT OF FUNDS AVAllABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE
YEAR ENDED JUNE SO.2011

Special Fundlnglnitlatlve State Appropriation State General Funds
Teachlng State Appropriat~on State General Funds Federal Funds American Recovery and Re~nvestmenAt ct Federal Stabilization Funds Other Funds
Total Teaching
Total Operating ActiviPy

Original Appropriation

Amended Appropriation

Final Budget

Current Year Revenues

Funds Available Compared to Budget

Prior Year

Adjustments and

Total

Carryaver

Program Transfers Funds Ava~lable

Variance Positive (Negative)

Expend~turesCompared to Budget

Varlance

Actual

Positive (Negative)

Excess IDeficlencv) of Funds Available
Over/(Under) Expenditures

CLAYTON STATE UNIVERSITY STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE
YEAR ENDEDJUNE 30.2011

Special FundingInitiative State Appropriat~on State General Funds
Teaching State Appropr~ation State General Funds Federal Funds American Recovery and Reinvestment Act Federal Stab~l~zat~Founds Other Funds
Total Teaching
Total Operat~ngActivity
Prlor Year Reserves Not Ava~lablefor Expenditure Uncollectible Accounts Receivable

Beginning Fund Balance/(Deficit)
July 1

Fund Balance Carrled Over from
Prior Period as Funds Available

Return of F~scaYl ear 2010
Surplus

Pr~oPr erlod Adjustments

Budget U n ~Ttotals

Other Adjustments

Early Return Fiscal Year 2011
Surplus

Excess (Deficiency) of Funds Available
Over/(Under) Expenditures

Endln-g Fund Balance/(Def~c~t)
June 30

Analysis of Ending Fund Balance

Reserved

Surplus/(Deficit)

Total

Summary of EndingFund Balance Resewed
Department Sales and Sew~ces IndirectCost Recover~es Technolog Fees Uncollectible Accounts Receivable Tuition Carry-Over Unrese~ed Surplus
Total EndingFund Balance-June 30

$

171.596.79

407.773.90

56.866.65

112.076.56

637,655.08

$

$ 37.362.72

171.596.79 407.773.90
56.866.65 112.076.56 637.655.08
37.362.72