Dalton State College, Dalton, Georgia, report on review of the financial statements for the fiscal year ended June 30, 2002

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STATE OF GEORGIA QEPARTMENT OF AUDITS AND ACCOUNTS

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DALTO' N STATE CO' LLEGE

'. _, DALTON, GEORGIA -

' RfPORT ON REVIEW - ; :
, OF THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2002

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w. Russell Hinton
State Auditor-

DALTON STATE COLLEGE - TABLE OF CONTENTS -

FINANCIAL

INDEPENDENT ACCOUNTANTS COMBINED REPORT ON REVIEW OF BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

REQUIRED SUPPLEMENTARY INFORMATION

MANAGEMENT'S DISCUSSION AND ANALYSIS

2

BASIC FINANCIAL STATEMENTS

EXHIBITS

A STATEMENT OF NET ASSETS

11

B STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS

12

C STATEMENT OF CASH FLOWS-

13

D NOTESTOTHEFINANCIALSTATEMENTS

14

SUPPLEMENTARY INFORMATION

SCHEDULES

SCHEDULES OF REVENUES AND EXPENDITURES COMPARED TO

BUDGET - (NON-GAAP BASIS)

1

RESIDENT INSTRUCTION

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31

2

LOTTERY FOR EDUCATION

32

3 RECONCILIATION OF SALARIES AND TRAVEL

33

FINANCIAL

Rv"-,1:.11

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H1"" ror..

STATE AUDITOR

(40,t) 655-217

DEPARTMENT OF AUDITS AND ACCOUNTS
254 \\'n..,hmg1on Street S \V. Sulit:' 214 AtlJnlJ Georgia '103'14-8400
January 31, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly of Georgia Members of the Board of Regents of the Uruvers1ty System of Georgia
and Honorable James A Burran, President Dalton State College
INDEPENDENT ACCOUNTANT'S COMBINED REPORT ON REVIEW OF BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
Laches and Gentlemen
We have reviewed the accompanymg basic financial statements (Exhibits A through D) of Dalton State College, an orgaruzatlonal urut of the State of Georgia, as of and for the year ended June 30, 2002, m accordance with Statements on Standards for Accounting and Review Services issued by the Amencan Institute of Certified Pubhc Accountants All mformat1on mcluded m these financial statements 1s the representation of the management of Dalton State College
A review consists pnnc1pally of mqumes of Dalton State College personnel and analytical
procedures applied to financial data It 1s substantially less m scope qian an audit m accordance with
auditing standards generally accepted m the Uruted States of Amenca, the obJectlve ofwhich 1s the expression of an op1ruon regardmg the fmancial statements taken as a whole. Accordmgly, we do not express such an op1ruon.
Based on our review, with the exception of the matter discussed m the fourth paragraph, we are not aware ofany matenal mod1ficat10ns that should be made to the accompanymg financial statements m order for them to be m conformity with accounting pnnc1ples generally accepted m the Uruted States of Amenca
As descnbed m Note I to the financial statements, Dalton State College did not recogruze June 30. 2001, encumbrances as expenses m the June 30, 2002, basic financial statements To conform to generally accepted accountmg pnnc1ples, encumbrances should be recogruzed as expenses and hab1ht1es m the penod that goods and services are received. The effects on the basic financial statements of this departure from generally accepted accountmg pnnc1ples were not reasonably determinable
02ARL-67

As descnbed in Note I, Dalton State College adopted the prov1s1ons of Governmental Accounting Standards Board (GASB) Statement No 35, Basic Fmancza/ Statements - and Management's D1scuss1on and Ana(vs1s -for Publzc Colleges and Umversllles, as amended by GASB Statement No 37, Basic Fmancza/ Statements -and Management's D1scuss1on and Ana(vs1s -for State and Local Governments, and GASB Statement No 38, Certain Fmanczal Statements Note Disclosures, as of July I, 2001, to implement a new financial reporting model
Management's D1scuss1on and Analysis 1s not a required part ofthe basic financial statements but 1s supplementary information reqwred by the GASB We have apphed certam hm1ted procedures, wluch consisted pnnc1pally ofinqumes ofmanagement regardmg the methods ofmeasurement and presentation ofth1s supplementary mformat1on, and we are not aware of any matenal mod1ficallons that should be made thereto.
Our review was made for the purpose of expressing IIIIllted assurance that there are no matenal mod1ficat10ns that should be made to the financial statements in order for them to be m conformity with accountmg pnnc1ples generally accepted m the Uruted States ofAmenca The accompanying supplementary information (Schedules l through 3) 1s presented for addmonal analysis purposes Such information has been subJected to the mqwnes and analytical procedures apphed in the review of the financial statements, and we are not aware ofany matenal modifications that should be made to such data
Respectfully submitted,

RWH:as 02ARL-67

Hinton State Auditor
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REQUIRED SUPPLEMENTARY INFORMATION
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DALTON STATE COLLEGE
Management's Discussion and Analysis

Introduction

Dalton State College 1s one ofthe 34 mstltuUons ofthe Umverslty System ofGeorgia The College, located m Dalton, Georgia, was opened m 1967 and has become known for its techmcal, transfer, health-related and busmess programs The College offers techmcal, associate, and targeted baccalaureate degrees This Wide range of educational opportumues attracts a lnghly quahfied faculty and a growmg student body Student enrollment mcreased from Fall '00 to Fall '01 by 16 18 percent

Enrollment Headcount

Fall '01 Fall'00

3,647 3,139

Overview ofthe Financial Statements and Financial Analysis

Dalton State College 1s proud to present its financial statements for fiscal year 2002 The emphasis of

d1scuss1ons about these statements will be on current year data There are three financial statements

presented the Statement of Net Assets, the Statement ofRevenues, Expenses and Changes m Net

Assets, and, the Statement of Cash Flows Tins d1scuss1on and analysis of the College's financial

statements proVIdes an overview of its financial act1v1t1es for the year Dalton State College has

elected to not restate pnor penods for purposes of proVIdmg the comparative data for this

Management's D1scuss10n and Analysis However, m future years, when pnor penod mformatlon 1s

available, a comparative analysis will be presented.

Statement ofNet Assets

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The Statement ofNet Assets presents the assets, hab1ht1es, and net assets ofthe College as ofthe end ofthe fiscal year The Statement ofNet Assets 1s a pomt oft1me financial statement The purpose of the Statement ofNet Assets 1s to present to the readers ofthe financial statements a fiscal snapshot of Dalton State College The Statement of Net Assets presents end-of-year data concemmg Assets (current and non-current), L1ab1ht1es (current and non-current), and Net Assets (assets mmus hab1ht1es) The ciifference between current and non-current assets will be discussed m the notes to the financial stalements

From the data presented, readers of the Statement of Net Assets are able to determme the assets available to continue the operations of the mst1tutlon They are also able to determmehow much the mstltutlon owes vendors, mvestors and lendmg institutions

Fmally, the Statement ofNet Assets provides a picture ofthe net assets (assets mmus hab1ht1es) and theu availab1hty for expenditure by the 1nsUtut1on Net assets are d1v1ded mto three maJor categones The first category, invested m capital assets, net of debt, provides the msututlon's eqwty

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m property, plant and equipment owned by the mstltutlon The next asset category 1s restncted net assets, expendable Expendable restncted net assets are available for expenditure by the mstltutlon but must be spent for purposes as determmed by donors and/or external entitles that have placed time or purpose restncllons on the use of the assets The final category 1s unrestricted net assets Unrestricted assets are available to the mslltutlon for any lawful purpose of the mstltut10n

Statement of Net Assets, Condensed (thousands of dollars)

Assets Current Assets Capital Assets, Net

$ 4,620 19,077

Total Assets

$ 23,697

Liabilities Current L1ab1ht1es Non-Current L1ab1ht1es

$ 2,178 95

Total Liabilities

$ 2,273

Net Assets Invested m Capital Assets, Net ofDebt Restricted - Expendable Unrestricted

$ 19,055 -4
2,373

Total Net Assets Statement ofRnenues, Expenses and Changes in Net Assets

$ 21.424

Changes m total net assets as presented on the Statement of Net Assets are based on the activity presented m the Statement of Revenues, Expenses and Changes m Ille! Assets The purpose of the statement 1s to present the revenues received by the mstltutlon, both operatmg and nonoperatmg, and the expenses paid by the mstltutlon, operating and nonoperatmg, and any other revenues, expenses, gams and losses received or spent by the mst1tut1on Generally speakmg operating revenues are received for prov1dmg goods and services to the vanous customers and constituencies of the mst1tut10n Operatmg expenses are those expenses paid to acqwre or produce the goods and sCTVIces provided m return for the operatmg revenues, and to carry out the rruss1on of the 1nstltut1on Nonoperatmg revenues are revenues received for winch goods and servJces are not provided For example state appropnatlons are nonoperatmg because they are proVJded by the Legislature to the tnstltut1on Without the Legislature directly rece1vmg commensurate goods and servJces for those revenues

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Statement of Revenues, Expenses and Changes m Net Assets, Condensed (thousands of dollars)

Operatmg Revenues Operatmg Expenses

S 6,823 21. I 78

Operatmg Loss

$ -14,355

Nonoperatmg Revenues and Expenses

14,5 I 7

Income (Loss) Before Other Revenues, Expenses, Garns or Losses

$ 162

Other Revenues, Expenses, Gains or Losses

I I 749

Increase m Net Assets

$ I 1,911

Net Assets at Begmrung of Year, as Ongmally Reported

$ 37,469

Cumulative Effect of Changes m Accountmg Pnnc1ple

-27,956

Net Assets at Begmnmg of Year Restated

$ 9,513

Net Assets at End of Year

$ 21,424

The Statement of Revenues, Expenses and Changes m Net Assets reflects a positive year with an mcrease m the net assets at the end ofthe year Some lughhghts ofthe mfonnatlon presented on the Statement of Revenues, Expenses and Changes m Net Assets are as follows

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Revenue By Source (thousands of dollars) For The Year Ended June 30, 2002

Operatmg Revenue Twtlon and Fees Grants and Contracts Sales and Services of Educational Departments Awuhary Other
Total Operating Revenue
Nonoperatlng Revenue State Appropnatlons Grants and Contracts Gifts Investment Income Other
Total Nonoperatmg Revenue
Total Revenues

$ 2,413 2,593 391 1,366 59
$ 6,822
$ 11,534 2,869 84 90 -60
$ 14,517
$ i1 JJ2

Expenses (thousands of dollars) For The Year Ended June 30, 2002

Operating Expenses Instruction Pubhc Service Academic Support Student Services Institutional Support Plant Operations and Mamtenance Scholarslnps and Fellowslnps Auxiliary Enterpnses

. .

$ 11,102

2

1,267

1,533

2,656

2,590

800

1,227

Total Operating Expenses

$ 21,)77

The Hope Scholarslnp Program expenses are included m the Agency Funds financial statement and are not mcluded m Scholarships and Fellowships m sponsored operations

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The compensation and employee benefits category 1s S14,082,680 68 Tins total for fiscal year 2002 reflects an employee salary increase of approximately 4 50% With the associated fnnge benefits Increased employer cost ofhealth insurance for fiscal year 2002 for the employees of the inslltullon 1s also included

Ut1ht1es (including telephone) were $556,607 97 dunng the past year The increase was pnmanly associated with the natural gas costs, new bmlding square footage, and nsing electncal rates that were expenenced dunng fiscal years 2001 and 2002

Under nonoperaung revenues (expenses) state appropnatlons for fiscal year 2002 are $11,534,841 00 Wlule 11 appears that the institution received a substantial amount of new money from the state, given the mandatory cost mcreases of vanous categones of expenses, the College actually had a relauvely flat funding year with all things considered

The cumulative effects of changes m accountmg pnnc1ple are the result of the College adoptmg depreciation on capital assets and recogmtion of compensated absences

Statement ofCash Flows

The final statement presented by Dalton State College 1s the Statement of Cash Flows. The Statement of Cash Flows presents detailed mfonnatlon about the cash acuv1ty of the mstltutlon dunng the year. The statement 1s d1V1ded mto five parts. The first part deals with operatmg cash flows and shows the net cash used by the operat:tng actlVJt:tes of the mslltutlon The second section reflects cash flows from non-capital financmg activities Tins section reflects the cash received and spent for nonoperat:tng, non-invest:tng, and non-capital financmg purposes The third section reflects the cash flows from mvest:tng actlvit:tes and shows the purchases, proceeds, and mterest received from mvest:tng act1v1ties. The fourth sect:ton deals With cash flows from capital and related financing act1v1t1es. This section deals with the cash used for the acqu1s1t1on and construction of capital and related items. The fifth sect:ton reconciles the net cash used to the operating mcome or loss reflected on the Statement of Revenues, Expenses and Changes m Net Assets

Cash Flows for the Year Ended June 30, 2002, Condensed (thousands of dollars)

Cash Provided (Used) By: Operat:tng Act:tVJtles Non-Capital Fmancing Activities lnvest:tng Act:tVJtles Capital and Related F1nancmg ActlVJtles

$-14,065 14,982 68 -238

Net Change m Cash Cash, Beginning of Year
Cash, End of Year

$ 747 I 140
$ I,ssz

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Capital Assets
The College had two s1gruficant capital asset add1t1ons for fac1ht1es m fiscal year 2002 The Roberts Library renovat10n and add11ion was completed Spnng '02 by Georgia State Fmancmg and Investment Comm1ss10n (GSFIC) and the Technical Bmldmg renoval!on was completed by the College dunng Summer Semester '02
For add111onal mformalion concerrung Capital Assets, see Notes I and 5 m the notes to the financial statements.
Economic Outlook
The College ts not aware of any currently lmown facts, dec1s10ns, or cond11ions that are expected to have a s1gmficant effect on the financial pos11ion or results of operalions dunng this fiscal year beyond those unlmown vanables haVJng a global effect on virtually all types ofbusmess operalions The College's overall financial pos11ion 1s strong Even With a relalively flat funded year, the College was able to operate efficiently and sufficiently The College anuc1pates the current fiscal year WIii be much h.ke last and WIii mamtam a close watch over resources to mamtam the College's ab1hty to react to unlmown mtemal and external issues.

James A Burran, President Dalton State College

Thomas E Godbee, VP for Fiscal Affairs Dalton State College
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BASIC FINANCIAL STATEMENTS
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DALTON STATE COLLEGE
STATEMENT OF NET ASSETS
JUNE 30, 2002

ASSETS

Current Assets Cash and Cash Equ,valents Short-term Investments Accounts Rece,vable, Net Federal Financial Assistance Other Prepaid Items lnventones

Total Current Assets

Noncurrent Assets Caprtal Assets. Net (See Note 5)

Total Assets

LIABILITIES

Currerrt l.Jab1hbes Contracts Payable Salanes Payable Payroll Wrthhold1ngs Accourrts Payable Deferred Revenue Funds Held for Others Compensated Absences

Total Current Llab1lltoes

Noncurrerrt L1ab1lrtoes

Compensated Absences

:

Total L1ab1ht1es
NET ASSETS

Invested on Capital Assets. Net of Related Debt Restncted Unrestncted

Total Net Assets

EXHIBIT "A"

$ 1,887.346 60 923.355 54
63,086 24 1,014,764 68
476.101 35 255,955 24
$ 4,620,609 65
$ 19,077,04515
$ 23,697,654 80

$

21,940 87

316,208 21

115,779 20

335,456 74

997.945 91

50,930 92

340 152 65

$ 2,178,414 50

$

95 065 47

$ 2,273,479 97

$ 19.055,104 28 -4.782 36
2,373,852 91

$ 21,424,174 83

See Independent Accountant's Combined Report on Revtew of Basrc Financial Statements and Supplementary lnforrnatoon
The notes to the financial statemerrts are an integral part of thrs statemerrt 11

DALTON STATE COLLEGE
STATEMENT OF REVENUES EXPENSES ANO CHANGES IN NET ASSETS
YEAR ENDED JUNE 30 2002

EXHIBIT "B"

OPERATING REVENUES
Student Turtion end Fees Less Sdlolarshlp Allowances
Grants and Contracts Federal
Sales and services of Educat:Jonal Departments Awdhary Enterprises
Bookst0f8 Food Servia,s
Other Operatmg RevenUM
Total Operating Revenues
OPERATING EXPENSES
Satarleo Faculty Staff
Employee Benefits Other Personal Servk:es Travel Scholaralups and Fellowships utwba6 Supplie& and Other Se.Mees Depraaallon
Total Operating Expenses
Operating Income (Lou)
NONOPERATING REVENUES <EXPENSES)
Stata Appropnabons Grants and Contracts
Federal State Nongovernmental Gifts Interest and Other Investment Income Other NonoperaOng Revenues
Net Nonoperat,ng Revenueo
Income Before Other Revenues
Capital Grants and Gifts State
lncrease/(Oecreaae) m Net Aueta
Net Assets Net Assets - Beginning of Year, as Originally Reported Cumulative Effect of Changas In Accounhng Principia
Net Assets - Beginning of Year, Restated
Net Assets - End of Year
See Independent Accountant's Combined Report on Review of Basic Financial Statements and Supplementary Information
The notes to the financial statements are an Integral s:,art of this statement - 12

$ 4 170 844 89 -1 757,575 46
2 592 936 29 391 153 47
116436807 201,807 42 5918001
$ 6 822 714 69

$ 6 052 173 BO 5 188,272 07 2 873 162 99 38 827 52 11644266 1,056 025 69 556,607 97 4 263 585 06 1 030 334 45
$ 21 1n 432 21
$ -14 354 717 52

$ 11,534,027 91

769 690 83 1,653,260 30
445 804 70 83,951 00 89 849 28 -59 630 99

$ 14,516,953 03

$

162 235 51

$ 11 748 577 63 $ 1191081314

$ 37,469,054 53 -27 955 692 84
$ 9 513 361 69

$ 21 424 174 83

DALTON STATE COLLEGE STATEMENT Of CASH FLOWS YEAR ENDED JUNE 3Q 2002

CASH FLOWS FROM OPERATING ACTIVITIES Tulbon and Fees Grants and ContradS Safes and Services of Educational Departments Payments to Suppl,ers Payments to Employees Payments tor Scholarships and Fellowst.ps Au>ahary Enterpnsa Charges Bookstore Food Services Other Receipts (Payments)
Net Gash Provided (Uaed) by Operating AdNltles
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Slate Appropriations Agency Funds Transacllons Gifts and Grants ReceMld tor Other than C.pltal P.._es Other Nonoperabng Rece,ptg
Net Gash Flows Pn,v,ded (Uaed) by NoncaprtaJ Fmanang AclMbes
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Pu'chases ofCapttal Asselo
CASH FLOWS FROM INVESTING ACTMTIES
Interest on Investments
Net lraease/(Deaeesa) ,n Cash
Csoh and Csoh Equ1V81en1s - Jll'IO 30, 2001 l.e&s Short-Tenn Investments
Cash and Gash EQUIVBlents - Beglnnlng of Year

C8ah and Gash Eq1,1valents - End of Year

RECONCILIATION OF OPERATING LOSS TO NET CASH

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PROVIDED (USED) BY OPERATING ACTIVITIES

Operating Income (Loss) AdJustmema to Reconcile Net Income (loss) to Net C86h
Provided (Uaed) by Operabng Acbvl1le6

Depredation Chango In Assets and UablllUos
1 - . . . Acco...-.ts ReceNables, Net

Pr8pald Items

Accountl Payable

Salaries Payable DeferredRo-,ue

Compensa1ed Abooncea

Net Cash Provided (Uaed) by Opore1lng Acllvllles

See tndepe1 Klent Accountant's Combinad Report oo R8Yl8W of Baslc Flnanaal Statements and Supplementary lnfonnatlon
The notes to the flnanaal statements are an Integral part of thiS statement. 13 -

EXHIBIT "C"

s 2 306 7TT 88
2,592,936 29 391153 47
-8 529 348 10 -1119613665
-1,056 025 69
1,164 368 07 201 807 42 59 180 01
s -14,065~87 30

s 11,534,027 91
204 941 24 3,261,945 97
-18 802 35
s 14,982,112TT

s

-237 556 75

s

87.820 08

s

74708880

s 2 041,58414
-901,326 34

s 1,140~57 80

s 1 887 346 60

s -14 354,717 52
1,030,334 45
-439,169.21 -2 757 34 5,829 01
-681,793 57 49 534 34 3328TT66 -5,225 12
s -14 065 287 30

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DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

NOTE I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS Dalton State College serves the state, and national commurutles by prov1dmg its students with academic mstructlon that advances fundamental knowledge, and by d1ssemmatmg knowledge to the people of Georgia and throughout the country
REPORTING ENTITY Dalton State College 1s one of tlurty-four (34) State supported member mstltutlons of lugher education m Georgia which compnse the Umvers1ty System ofGeorgia, an orgamzal.lonal unit ofthe State of Georgia The accompanymg financial statements reflect the operations of Dalton State College as a separate reporting entity
The Board of Regents has constitutional authonty to govern, control and manage the Umvers1ty System of Georgia This authonty mcludes but 1s not hrmted to the power to designate management, the ab1hty to s1gmficantly mfluence operations, the authonty to control mst1tut1ons' budgets, the power to determme allotments of State funds to member mstltut1ons and the authonty to prescnbe accountmg systems and adrmmstrative pohc1es for member mst1tutions Dalton State College does not have authonty to retam unexpended State appropnat1ons (surplus) for any given fiscal year. Accordmgly, Dalton State College 1s considered an orgamzatlonal urut of the Board of Regents of the Umvers1ty System of Georgia reporting entity for financial reporting purposes because of the s1gmficance ofIts legal, operational, and financial relatJonslups WIth the Board ofRegents as defined m Section 2100 of the Governmental Accountmg Standards Board (GASB) Codification of Governmental Accounting and Fmanc1al Reportmg Standards.
FINANCIAL STATEMENT PRESENTATION In June 1999, the GASB issued Statement No. 34, Basic Financial Statements and Management Discusswn and Analysisfor State and Local Governments. Tlus was followed m November 1999 by GASB Statement No. 35, Basic Financial Statements and Management's Discusswn and Ana~ysis for Public Colleges and Universities. The State of Georgia 1s required to implement GASB Statement No. 34 as of and for the year ended June 30, 2002 As an organizational urut of the State of Georgia, the College 1s also reqwred to adopt GASB Statements No 34 and No 35 as amended by GASB Statements No 37 and No. 38 The financial statement presental.lon reqwred by GASB Statements No 34 and No 35 as amended by GASB Statements No 37 and No. 38 proVIdes a comprehensive, entity-Wide perspective of the College's assets, hab1hl.les, net assets, revenues, expenses, changes m net assets, cash flows, and replaces the fund group perspective previously reqwred
The College has elected to not restate its 2001 financial statements to conform WIth the new financial statement presentation, therefore comparative financial mformation WIii not be presented for fiscal year 2002 S1gmficant accounl.lng changes made m order to comply with the new requirements include (1) adoption of depreciation on capital assets, and (2) recogmtlon ofcompensated absences

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DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

FINANCIAL STATEMENT PRESENTATION Generally Accepted Accountmg Pnnc1ples (GAAP) reqmres that the reportmg of summer school revenues and expenses be between fiscal years rather than m one fiscal year Due to the lack of matenahty, Institutions ofthe Umvers1ty System ofGeorgia will contmue to report swnmerrevenues and expenses m the year m which the predommate act1v1ty takes place

At June 30, 2001, encumbrances (contractual obiigatlons for goods and servJces not received at fiscal year end) were recorded as expenditures by the College mstead of reservations of fund balance as reqmred by generally accepted accounting pnnc1ples For fiscal year 2002, the College changed its method ofrecordmg encumbrances such that encumbrances at June 30, 2002 were not recorded as expenses This change 1s m accordance With generally accepted accountmg pnnc1ples

No adjustments however, have been made on the financial statements to restate the fund balance at July 1, 2001 for the June 30, 2001 encumbrances recorded as expenditures m fiscal year 2001. The net effect of the above accountmg treatment resulted m an understatement of expenses on the accompanymg financial statements for pnor year encumbrances winch should have been reflected as expenses m the penod when goods and services were received

BASIS OF ACCOUNTING For financial reportmg purposes, the College 1s considered a special-purpose government engaged

only m busmess-type act1V1t1es. Accordmgly, the College's financial statements have been presented

usmg the economic resources measurement focus and the accrual basis of accountmg, except as

noted m the precedmg paragraphs. Under the accrual basis, revenues are recogruzed when earned,

and expenses are recorded when an obhgat1on has been mcurred All s1gruficant mtra-college

transactions have been ehmmated.

.



The College has the option to apply all Fmanc1al Accountmg Standards Board (FASB)

pronouncements issued after November 30, 1989, unless FASB conflicts with GASB. The College

has elected to not apply FASB pronouncements issued after the applicable date

RESTATEMENT OF NET ASSETS - BEGINNING OF YEAR As a result ofthe adoption ofGASB Statement No 34, the College was also required to make certam changes m accountmg pnnc1ples, specifically (I) adoption ofdepreciation on capital assets, and (2) recordmg of compensated absences GASB Statement No 34 requires certam swnmer semester revenues be recogruzed between fiscal years rather than the fiscal year m winch the semester was predommantly conducted. The Uruverslty System of Georgia has chosen to continue to record swnmer revenue m the year m which the semester was predommantly conducted Net assets at July 1, 2001 were reduced by $27,955,692 84 for the cumulative effect of these changes

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DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

NOTE I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CASH AND CASH EQUIVALENTS/SHORT-TERM INVESTMENTS Cash and Cash Eqmvalents consist of petty cash, demand deposits and lime deposits m authonzed financial mst1tut10ns, and cash management pools that have the general charactenstlcs of demand deposit accounts
ACCOUNTS RECEIVABLE Accounts receivable consists oftu1t10n and fee charges to students and aux1hary enterpnsc services provided to students, faculty and staff, the maJonty of each res1dmg m the State of Georgia Accounts receivable also mclude amounts due from the Federal government, state and local governments, or pnvate sources, m connection with reimbursement ofallowable expenditures made pursuant to the College's grant and contracts Accounts receivable are recorded net of estimated uncollectJble amounts
INVENTORIES Consumable supplies are earned at the lower of cost or market on either the first-m, first-out ("FIFO") basis
Resale Inventones are valued at cost usmg the average-cost basis
CAPITAL ASSETS Cap1taJ assets are recorded at cost at the date of acqu1s1t1on, or fwr market value at the date of donation m the case of gifts For eqmpment. the College's cap1talizat1on pohcy mcludes all items with a umt cost of $5,000 00 or more, and an estimated useful hfe of greater than one year Renovations to bmldings, mfrastructure, and land improvements that exceed $100,000.00 and s1gmficantly mcrease the value or extend the useful hfe of the structure are cap1taJ1zed. Routme
repairs and mwntenance are charged to operatmg expense m the ,jear m which the expense was
mcurred. Depreciation 1s computed usmg the str3.lght-hne method over the estimated useful hves of the assets, generally 40 to 60 years for bmldings, 20 to 25 years for land improvements, IO years for hbrary books, and 3 to 7 years for equipment.
To obtwn the total picture of plant additions m the Umvers1ty System, 1t 1s necessary to look at the act1v1t1es ofthe Georgia State Fmancmg and Investment Comm1ss1on (GSFIC) - an orgamzallon that 1s external to the System GSFIC issues bonds for and on behalfofthe State of Georgia, pursuant to powers granted to 11 m the Constitution ofthe State of Georgia and the Act creatmg the GSFIC The bonds so JSsued constitute direct and general obhgat10ns of the State of Georgia, to the payment of which the full fwth, credit and taxmg power of the State are pledged

- 16 -

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

NOTE I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CAPITAL ASSETS Effective July I, 2001, the GSFIC retams construct10n m progress on the!T books throughout the construction penod and transfers the entire project to Dalton State College when complete For the year ended June 30, 2002, GSFIC transferred capital add1t10ns valued at $11,748,577 63 to Dalton State College

DEFERRED REVENUES Deferred revenues mclude amounts received for tuition and fees and certam aux1hary acttVIUes pnor to the end of the fiscal year but related to the subsequent accountmg penod. Deferred revenues also mclude amounts received from grant and contract sponsors that have not yet been earned

COMPENSATED ABSENCES Employee vacation pay 1s accrued at year-end for financial statement purposes The hab1hty and expense mcurred are recorded at year-end as accrued vacation payable m the Statement of Net Assets, and as a component of compensation and benefit expense m the Statements of Revenues, Expenses, and Changes m Net Assets Dalton State College had accrued hab1hty for compensated absences m the amount of$440,443 24 as of July I, 2001 For Fiscal Year 2002, $336,982.99 was earned m compensated absences and employees were paid $342.208 11, for a net decrease of $5,225.12

NON-CURRENT LIABILITIES

Non-current hab1ht1es mclude (I) hab1hlies that will not be paid withm the next fiscal year, (2)

capital lease obhgatlons with contractual matuntles greater than one year, and (3) other hab1htles

that, although payable w1thm one year, are to be paid from funds that are classified as non-current

assets.

:

NET ASSETS The College's net assets are classified as follows

Invested m capital assets, net of related debt Th.is represents the College's total mvestrnent m capital assets, net of outstandmg debt obhgat1ons related to those capital assets To the extent debt has been mcurred but not yet expended for capital assets, such amounts are not included as a component ofmvested m capital assets, net of related debt (The term "debt obhgatlons" as used m this definition does not mclude debt of the GSFIC as discussed above)

Restricted net assets Restncted net assets mclude resources m wluch the College 1s legally or contractually obhgated to spend resources m accordance with restnctlons imposed by external th1Td parties

- 17 -

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTE I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NET ASSETS Unrestricted net assets Unrestricted net assets represent resources denved from student tuition and fees, state appropnatlons, and sales and services of educational departments and auxiliary enterpnses These resources are used for transactions relatmg to the educational and general operallons of the College, and may be used at the d1scre11on of the goverrung board to meet current expenses for those purposes, except for unexpended state appropnatlons (surplus) of $5,341.72. Unexpended state appropnallons must be refunded to the Board ofRegents ofthe Uruvers1ty System of Georgia - Adnuru.strat1ve Central Office for rermttance to the Office of Treasury and Fiscal Services These resources also mclude auxiliary enterpnses, winch are substantially self-supportmg activities that provide services for students, faculty and staff
When an expense 1s mcurred that can be paid usmg either restricted or unrestricted resources, the College's policy 1s to first apply the expense towards unrestncted resources, and then towards restncted resources.
INCOME TAXES Dalton State College, as a politlcal subdivision of the State of Georgia, 1s excluded from Federal mcome taxes under Section 115( I) of the Internal Revenue Code, as amended.
CLASSIFICATION OF REVENUES The College has classified its revenues as either operating or non-operating revenues m the Statement of Revenues, Expenses, and Changes m Net Assets accord.mg to the followmg cntena
Opera/mg reienues Operating revenues mclude activities that have the charactensl!cs ofexchange transactions, such as (I) student tuition and fees, net ofscholarslup allowances, (2) sales and services
of auxiliary enterpnses, (3) most Federal, state and local grants and contracts and Federal
appropnatlons, and (4) mterest on 1nstltutlonal student loans.
Non-operating revenues Non-operating revenues mclude acllvilles that have the charactensllcs of non-exchange transactions, such as gifts and contributions, and other revenue sources that are defined as non-operatmg revenues by GASB No. 9, Reporting Cash Flows of Proprietary and Nonexpendable Trust Funds and Governmental Enllt1es That Use Proprietary Fund Accounting, and GASB No. 34, such as state appropnat1ons and mvestment mcome

- 18 -

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

NOTE l SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SCHOLARSHIP ALLOWANCES Student tu1t10n and fee revenues, and certain other revenues from students, are reported at gross with a contra revenue account of scholarship allowances m the Statement of Revenues, Expenses and Changes in Net Assets. Scholarship allowances are the difference between the stated charge for goods and services provided by the College, and the amount that 1s paid by students and/or third parties makmg payments on the students' behalf Certain governmental grants, such as Pell grants, and other Federal, state or nongovernmental programs, are recorded as either operating or nonoperating revenues in the College's financial statements. To the extent that revenues from such programs are used to satisfy tuition and fees and other student charges, the College has recorded contra revenue for scholarship allowances.
NOTE 2: CASH AND CASH EQUIVALENTS, OTHER DEPOSITS: AND INVESTMENTS
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds belonging to the State of Georgia (and thus Dalton State College) cannot be placed m a depository paymg interest longer than ten days without the depository prov1dmg a surety bond to the State. In heu of a surety bond, the depository may pledge as collateral any one or more of the following secuntles as enumerated in the Official Code of Georgia Annotated Section 50-17-59
1. Bonds, bill, certificates of indebtedness, notes, or other direct obligations ofthe Uruted States or of the State of Georgia.
2. Bonds, bills, certificates of indebtedness, notes, or other obhgatlons of the counties or mun1c1pal1t1es of the State of Georgia
3 Bonds of any pubhc authonty created by the laws ofthe State-ofGeorgia, prov1dmg that the statute that created the authonty authonzed the use of the bonds for this purpose.
4 Industnal revenue bonds and bonds of development authontles created by the laws of the State of Georgia
5. Bonds, bills, certificates of indebtedness, notes, or other obhgattons of a subs1d1ary corporation ofthe Uruted States government, which are fully guaranteed by the Uruted States government both as to pnnc1pal and interest, or debt obhgattons 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 Assoc1atton, and the Federal National Mortgage Association
6 Guarantee or insurance of accounts provided by the Federal Deposit Insurance Corporalton.

- 19 -

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

NOTE 2 CASH AND CASH EOUNALENTS. OTHER DEPOSITS. AND INVESTMENTS

STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Al; authonzed in the Official Code of Georgia Annotated Section 50-17-53, the State Depository Board has adopted pohc1es which allow agencies of the State of Georgia (and thus Dalton State College), the option of exempting demand deposits from the collateral reqwrements.

The Treasurer ofthe Board ofRegents 1s responsible for all detwls relative to funushmg the reqmred depository protection for all uruts of the Uruvers1ty System of Georgia

CATEGORIZATION OF DEPOSITS The College's cash deposits are categonzed by nsk as follows

Category I - Amounts covered by depository insurance or collaterahzed with secunues (at fwr value) held by the College or by its agent in the College's name

Category 2 - Amounts collaterahzed with secuntJes (at fwr value) held by the pledging financial institution's trust department or agent in the College's name

Category 3 - Amounts collateral1zed with secuntJes (at fair value) held by the pledging financial 1nslltullon, or by its trust department or agent but not in the College's name, and amounts uncollaterahzed.

Cash Deposits as of June 30, 2002 are as follows

Cash DepoSlts

Carrym;i
Amount

Bank
Balances

Risk Catcgoacs

s I sso 45 t 60 s 2265 2ss oz s ,oo ooo oo ~ 2 J65 285 oz s,___,o..,oo.,.

CATEGORIZATION OF INVESTMENTS At June 30, 2002, the carrying amount of the College's total investments was $923,355 54 and consisted entirely of funds in the State Investment Pool adm1rustered by the State ofGeorgia Office of Treasury and Fiscal Services wluch are not reqmred to be categonzed since the College did not own any specific 1dent1fiable secunlles m the pool.

Funds invested in an mvestment pool managed by another governmental entity are not reqmred to be categonzed smce the College dtd not own any specific, identifiable mvestment secunlles ofthe pool

NOTE 3 ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following at June 30, 2002

- 20-

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

NOTE 3 ACCOUNTS RECEIVABLE

Student Tuition and Fees Aux1hary Enteipnses and Other Operatmg Act1v1t1es Federal, State, and Pnvate Funds Other

$ 822,335 42 60,964 87 176,828.27 36,310 85

$1,096,439 41

Less Allowance for Doubtful Accounts

18.588 49

Net Accounts Receivable NOTE 4 INVENTORIES

S I.077 850:92

Inventones cons1stecl of the following at June 30, 2002:

Bookstore Food Services Central Store Postage

$ 194,662 51 7,857 02
41,826 53 11.609 18

Total

$ 255,955,24

NOTES CAPITAL ASSETS

The balance at July 1, 2001 was adJustecl for accounting changes required m 1mplernent1ng GASB Statements 34 and 35 as disclosed m Note 1 Followmg are the changes m capital assets for the year ended June 30, 2002.

- 21 -

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT"D"

NOTES CAPITAL ASSETS

AdJustcd Balance
/uiy I 2001

Add1t10ns

Rcducuon,;;

Balance June 30 2002

Capital Assets, 1',ot Bcmg Depreciated

Land and Land Improvements

$

Construction Work-In-Progress

72,465 30
000 s

2) 94087

$ 72,465 30 2),940 87

Total Capital Assets Not Bemg Dcp=1atcd

s s 72,465 30

21,940.87

s 94 406 J7

Capua! Assets, Bemg Dcpree1atcd Bu1ldmg and Bu1ldmg Improvements Fac1ht1es and Other Improvements Equipment Library Collcct1ons

s I 1,493,718 00 $ 10,944,052 52

2,518,966 00

2,368,151 17

879,558 76 $

3 878 660 00

)84 463 97

s S 20,259,495 17 $ 12,008,015 25

$ 22,437,770 52 2,5 I8,966 00
198,677 51 3,049,032 42 9,243 00 4,053,880 97
s ~01220 5) 32059~99)

Less Accumulated Dcprcc1at1on Bu1ldmgs and Bu1ldmg Improvements S Fac1ht1cs and Other Improvements Equipment Library Collccuons

6,369,921 67 $ 1,816,594 42 1,238,186 37
2,159,023.00

467,299 53 70,710 09
s 318,288 83
114 036 00

s $ JV83.725 46 I.QJ0.33445 $

s
127,805 98 9 243 00

6,837,221 20 I,887,304 5I 1,428,669 22
2 923,8)6 00

s )319!!8 98 )3011,0)093

Total Capital Assets. Bemg Depreciated,

Net

s 8,075 769 7) $ 10,977.740 80 $

Capital Assets, Net

s 8 148 235 01 $ JO 999 681 67 $

19 B1U3 s )8 982 638 98 7087153 s 1907704515

NOTE6 DEFERRED REVENUE

Deferred revenue consisted of the followmg at June 30, 2002

. .

Prepaid Tu11ton and Fees

Other Deferred Revenue

$ 848,349 05 149.596 86

Totals

$ 997,945 ,91

NOTE 7 LONG-TERM LIABILITIES

Long-term hab1hty acllv1ty for the year ended June 30, 2002, was as follows

Other L1ab1l1t1cs Compensated Absences

Balance
July I 2001

Add1tmns

Reductions

Balance June 30. 2002

Current
Pomon

$ ~g~J2~ s lJ6 98~ 99 s J~i 206 11 $ ~JS ~IS Ii $ J~O 1~2 65

- 22 -

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTES RETIREMENTPLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA

Plan Description Dalton State College part1c1pates m the Teachers Retuement System of Georgia (TRS), a costshanng mulllple-employer defined benefit pension plan estabhshed by the General Assembly of Georgia for the purpose of prov1dmg retJrernent allowances and other benefits for teachers of the State of Georgia TRS proVides SerV!ce rellrement, d1sab1hty retJrernent, and sllrV!vor's benefits for its members m accordance with State statute. The Teachers Reurernent System ofGeorgia issues a separate stand alone financial audit report and a copy can be obtamed from the Georgia Department of Audits and Accounts.

Funding Policy Employees of Dalton State College who are covered by TRS are reqmred by State statute to
contnbute 5% of their gross eammgs to TRS. Dalton State College makes monthly employer
contnbutlons to TRS at rates adopted by the TRS Board ofTrustees m accordance with State statute and as advised by their mdependent actuary. For fiscal year 2002, the employer contnbutlon rate was 9 24% for covered employees Employer contnbutJons for the current fiscal year and the precedmg two fiscal years are as follows:

Fiscal Year

Percentage Contnbuted

Reqmred Contnbuuon

2002 2001 2000
REGENTS RETIREMENT PLAN

100% 100%
100% ..

$ 748,71117 $ 880,099 95 $ 864,793 12

Plan Description The Regents Retirement Plan, a smgle-employer defined contnbutlon plan, 1s an optional retirement plan estabhshed and adrnlillstered by the Board of Regents of the Umvers1ty System of Georgia, under winch 1t may purchase annuity contracts for the purpose of prov1dmg rellrement and death benefits for eligible faculty and pnnc1pal adrn1mstrators Benefits depend solely on amounts contnbuted to the plan plus mvestrnent earnmgs Benefits are payable to part1c1patmg employees or their benefictanes m accordance with the terms of the annmty contracts

Funding Policy Member contnbutlon requuements are established by the Board of Trustees of the Teachers Rellrernent System Employer contribullons are established by statute and may be amended only by the General Assembly ofthe State of Georgia The employer contnbutes 9 62% ofthe part1c1patmg employee's eamable compensallon Employees contnbute 5% of their earnable compensauon Amounts attnbutable to all plan contnbullons are fully vested and non-forfettable at all limes

- 23 -

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

NOTE 8 RETIREMENT PLANS
REGENTS RETIREMENT PLAN
Funding Policy Dalton State College and the covered employees made the required contnbutlons of $180,703 17 (9 62%) and $93,920 94 (5%), respectlvely
GEORGIA DEFINED CONTRIBUTION PLAN
Plan Description Dalton State College part1c1pates m the Georgia Defined Contnbut10n Plan (GDCP) which 1s a smgle-employer defined contnbutlon plan established by the General Assembly of Georgia for the purpose ofprov1dmg retirement coverage for State employees who are temporary, seasonal, and parttime and are not members of a public retirement or pension system GDCP 1s adm1mstered by the Board of Trustees of the Employees' Retirement System of Georgia
Benefits A member may retire and elect to receive penod.Jc payments after attamment ofage 65 The payment will be based upon mortahty tables and mterest assumptions to be adopted by the Board ofTrustees If a member has less than$ 3,500.00 credited to his/her account, the Board ofTrustees has the option ofrequmng a lump sum d1stnbut1on to the member m lieu ofmakmg penod1c payments Upon the death of a member, a lump sum d1stnbut1on equalmg the amount credited to !us/her account will be paid to the member"s designated beneficiary. Benefit provisions are established by State statute
Contributions and Vesting Member contributions are seven and one-halfpercent (7.5%) of gross salary There are no employer contnbutlons. Contnbutlon rates are established by State statute arrungs are credited to each member's account m a manner established by the Board of Trustees Upon termmatlon of employment, the amount of the member's account 1s refundable upon request by the member
Total contnbut.Jons made by employees durmg fiscal year 2002 amounted to $38,838.67 wluch represents 7.5% of covered payroll. These contnbutJ.ons met the requirements of the plan.
NOTE 9 RISK MANAGEMENT
Dalton State College 1s a part1c1pant m the Board of Regents of the Uruvers1ty System of Georgia Health Benefits Plan, wluch 1s a self-insurance program ofhealth and dental benefits for employees and retirees ofthe Umvers1ty System of Georgia Dalton State College and part1c1patmg employees and renrees pay premiums to the Health Benefits Plan for tlus health insurance coverage The Health Benefits Plan 1s mcluded m the financial statements of the Board of Regents of the Umvers1ty System of Georgia - Adm1rustrat1ve Central Office. All uruts of the Uruvers1ty System of Georgia

- 24-

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

NOTE 9 RISK MANAGEMENT
share the nsk ofloss for chums of the Health Benefits Plan The Health Benefits Plan 1s considered a self-sustammg nsk fund that provides health coverage for its members up to a maximum lifeume
benefit of$2,000,000 00 per person and dental coverage up to an annual maximum of$ l ,OOO 00 per
person. The Board of Regents has contracted With Blue Cross Blue Shield of Georgia to process chums m accordance With the Health Benefits Plan as established by the Board of Regents.
The Department of Adnurustralive Services (DOAS) has the respons1b11ity for the State of Georgia of makmg and carrying out dec1s1ons that will IIllillm1ze the adverse effects of accidental losses that mvolve State government assets The State believes 1t 1s more economical to manage its nsks internally and set aside assets for clmm settlement Accordingly, DOAS processes clmms for nsk of loss to which the State 1s exposed, mcludmg general liability, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' mdemruficalion LIIIllted amounts of commercial !IlSurance are purchased applicable to property, employee and automobile hab1hty, fidelity and certam other nsks Dalton State College, as an orgamzat10nal unit ofthe Board ofRegents ofthe Uruvers1ty System ofGeorgia, 1s part ofthe State ofGeorgia reporung en!Ity, and as such, 1s covered by the State of Georgia nsk management program admirustered by DOAS Premiums for the risk management program are charged to the vanous state organ1zat1ons by DOAS to proVIde clmms servicmg and clmms payment.
A self-insured program of professional liability for its employees was established by the Board of Regents of the Uruvers1ty System of Georgia under powers authonzed by the Official Code of Georgia Annotated Sec!Ion 45-9-1. The program msures the employees to the extent that they are not immune from liability agmnst personal liability for danlages ansmg out of the performance of their duties or m any way connected tliereWJth The program 1s admirustered by DOAS as a SelfInsurance Fund.
:
NOTE I 0: CONTINGENCIES
Amounts received or receivable from grantor agencies are subject to aucht and adJustment by grantor agencies. This could result m refunds to the grantor agency for any expenditures which are disallowed under grant terms The amount ofexpenchtures winch may be chsallowed by the grantor cannot be determmed at tins !ime although Dalton State College expects such amounts, 1fany, to be 1mmatenal to its overall financial pos1!Ion.
L1!Igat1on, clmrns and assessments filed agmnst Dalton State College (an orgamzat1onal urut of the Board ofRegents of the Uruvers1ty System ofGeorgia), if any, are generally considered to be acuons agmnst the State of Georgia AccordingJy, s1gruficant htiga!ion, claims and assessments pendmg agmnst the State ofGeorgia are chsclosed in the State ofGeorgia Comprehensive Annual Fmanc1al Report for the fiscal year ended June 30, 2002.

- 25 -

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

NOTE 11 POST-EMPLOYMENT BENEFITS OTHER THAN PENSION BENEFITS
Pursuant to the general powers conferred by the Official Code ofGeorgia Annotated Section 20-331, the Board of Regents of the Umvers1ty System of Georgia has estabhshed group health and hfe msurance programs for regular employees ofthe Umvers1ty System ofGeorgia It 1s the pohcy ofthe Board ofRegents to perrmt employees ofthe Umvers1ty System ofGeorgia ehgible for retirement or that become permanently and totally disabled to contmue as members of the group health and hfe msurance programs Employees who are eligible for retirement or d1sab1hty under the cntena estabhshed by the Teachers Retirement System ofGeorgia and who have at least ten years ofservice with the Umvers1ty System of Georgia are eligible for these post-employment health and hfe msurance benefits Organ1zatlonal units of the Board of Regents of the Umvers1ty System of Georgia pay the employer portion for group msurance for affected md1v1duals
As of June 30, 2002, there were 44 employees who had retired or were disabled that were rece1vmg these post-employment health and hfe msurance benefits For the year ended June 30, 2002, Dalton State College recogmzed as mcurred $130,111 77 of expenditures, wluch was net of$46,765.55 of part1c1pant contnbutlons.

.

-26-

DALTON STATE COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

NOTE 12 NATURAL CLASSIFICATIONS WITH FUNCTIONAL CLASSIFICATIONS

The College's operating expenses by functional class1ficat1on are shown below

Statement of Operatmg Expenses - Natural vs I- uncuonal Classtficabons For the Fiscal Year Ulded June 30, 2002

Fuoctmnal Clasuficanon

Nab.mil Clasuficauon

lnstructmn

Pubhc
SCJYJcc

Academic Support

Student
Smices

fnst1tut1onal
Support

Salancs Faculty Staff
Employee Benefits Other Personal Semccs Travel Scholarsh,ps and
Fellowships Ut1ht1cs Supphc, and Other
ScrvlCCS Dcpm:ianon
Total Open,nng Expenses

s 6,049,313 30
1,568,284 21 1,798.325 44
1,870 00 67,726 81
116,884 45
s 1,499,193 14
SP 191 522 35 s

s 2,860 50

s s 601,399 37

807,15900

1,499.063 37

160,184 49

208,495 34

490.538 72

36.957 52

7,338 44

17,89006

24,891 98

5,655 00
13,304 60

21,452 23

250,470 31 25,954 JS

2,613 99

476,356 54

478,287 43

328,480 25

2613 99 s 1267 096 2:1 s I 5}}28406 s 2656 }56 ~1

Natural C!arnficat10n
Salanes Faculty Sta!T
~loyce Benefits Other Personal Scrvi.ces Tn.vcl Scholarslup, and
Fellowshtps UbhbeS Supplies and Other
Services Deprcc,ation
Total Opcroong Expenses

Plant
()pcr>ooos and
Mamtenancc

El!IKt!QDII Clw1ficat1on

Scholarships
and FeUowshms

Au:a:1l1ary F,ntgpnsq

Total Opcronng Expcn:;es

s 562.266 01
166,756 88
595 37

s 6,052,173 80

s 150,100 11

5,188,27207

48,862 12

2,873,162 99

38,827 52

118,442 66

s 799,900 38

376,038 31 453,552 99

. .

1,030334 45

2,974 00 1,025, I00 72

1,056,025 69 556,607 97
4,263,585 06
1,030,334 45

s ~ ~2~tu s 722~38 s I .:2z 1236 25 s ~I 177 ~l.: .:1

- 27 -

SUPPLEMENTARY INFORMATION
:
- 29 -

DALTON STATE COLLEGE
SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO
BUDGET CNON-GAAP BASIS} RESIDENT INSTRUCTION
YEAR ENDED JUNE 30 2002

SCHEDULE "1"

REVENUES
State AppropnatJons Other Revenues Retained

BUDGET

ACTUAL(1)

VARIANCEFAVORABLE (UNFAVORABLE)

$ 11,286,497 00 $ 11,286,497 00 $

14,936,279 00

10,390,899 36

000 -4 545 379 64

$ 26,222,776 00 $ 21,677,396 36 $ ___-4,;.,54a..:,:5"',3""7.::,9,;;:64.c

EXPENDITURES
Personal Serv:ces Educabon, General and Departmental Serv:ces Sponsored Operat:ons
Operabng Expenses Educabon, General and Departmental Serv:ces Sponsored Operabons
Cap:tal Outlay Speaal Fund:ng ln:batNe

$ 11,869,542 00 $ 11,771,59143 $

2,203,441 00

2,150,561 84

3,268, 162 00 7,252,691 00 1,086,02800
542,91200

3,163,13929 3,394,803 36
668,888 34 542,91200

97,950 57 52,879 16
105,022 71 3,857,887 64
417,13966 000

$ 2612221776 00 S 21,691,896 26 $ _ _ _4"",5'-'30=,8c..7.a.9,;,.74,;,.

Excess of Revenues over Expend:tures

$

-14 499 90 $ - - - ~ 1:,;;4,i;:4~9.::,9.::,90.::,

:

(1) Actual amounts were prepared on e presa:bed bas:s of eccounbng that demonstretes compl:ence With
budgetary &1atutea and regulatlons of the State of Georgia, wh:ch :a a compiehellSlve baSls of accounbng
other then generally accepted eccounbng pnnc:plas

See accompany:ng notes and Independent Accountanfs Comb:ned Report on Rev,ew of BaSlc F:nanclal Statements and Supplementary lntormabon
- 31 -

DALTON STATE COLLEGE SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO
BUDGET - INON-GAAP BASIS)
LOITTRY FOR EDUCATION YEAR ENDED JUNE 30 2002

SCHEDULE "2"

REVENUES State Appropriations

BUDGET

ACTUAL (1)

VARIANCEFAVORABLE (UNFAVORABLE)

$ 248 344 00 $ 248,344 oo s_____"'"o-"oo"'""

EXPENDITURES
Equipment, Technology and Construd1on Trust Fund
Speaal Funding lnrtJallves

$ 149,312 00 $ 149,312 00 $

000

99,032 00

99,032 00

o oo

$ 248,344 00 $ 248,344 00 $ _ _ _ _ _-'-0-"0-'--0

Excess of Revenues over Expenditures

$

0 00 $~---...:;,0~00:;,

(1) Actual amounts were prepared on a prescribed basis of accounllng that demonstrates compl1Bnce wrth budgetary statutes and regulations of the State of Georgia, whteh 1& a comprehensrve basis of accounllng other than generally accepted accounllng principles
.

See accompanying notes and Independent Accountant's Combined Report on Rev,ew of Basic F1riancial Statements and Supplementary Information
- 32 -

PALTON STATE COLLEGE RECONCILIATION OF SALARIES AND TRAVEL
YEAR ENOED JUNE 30. 2002

SCHEDULE "3"

Totals per Annual Supplement
Accruals June 30, 2002 June 30, 2001
Compensated Absences June 30, 2002 June 30, 2001

SALARIES $ 11,195,765 33 $

TRAVEL 118,442 66

316,208 21 -266,673 87

404,289 94 -409143 74

s s_ _ 11 240 445 01

1~1.0.44==2a..66.a..

:

See accompanying notes and Independent Accoumanfs Combined Report on Review of Basic Flnanaal Statements and Supplementary lnfonnat,on
- 33 -