GA A'bOO ,Kl C1431 [q9b-q.l AUDIT REPORT STATE OF GEORGIA BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) YEAR ENDED JUNE 30, 1997 STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS 254 WASHINGTON STREET ATLANTA, GEORGIA 30334-8400 BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) - TABLE OF CONTENTS - SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBINED REPORT ON FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION EXHIBITS FINANCIAL STATEMENTS A COMBINED BALANCE SHEET ALL FUND GROUPS 2 B COMBINED STATEMENT OF CHANGES IN FUND BALANCES ALL FUND GROUPS 4 C STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES, AND OTHER CHANGES 5 D NOTES TO THE FINANCIAL STATEMENTS 6 SUPPLEMENTARY INFORMATION E COMB~GBALANCESHEET CURRENT FUNDS - UNRESTRICTED 22 F COMB~G STATEMENT OF CHANGES IN FUND BALANCES CURRENT FUNDS - UNRESTRICTED 23 COMB~G STATEMENTS OF CURRENT FUNDS REVENUES, EXPENDITURES, AND OTHER CHANGES G UNRESTRICTED 24 H RESTRICTED 25 SCHEDULES SCHEDULES OF REVENUES AND EXPENDITURES COMPARED TO BUDGET 1 "A" RESIDENT INSTRUCTION 26 2 "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES 28 3 "D" LOTTERY FOR EDUCATION 29 SCHEDULES OF APPROVED BUDGET 4 "A" RESIDENT INSTRUCTION 31 5 "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES 32 6 "D"LOTTERYFOREDUCATION 35 SCHEDULES OF BUDGET TRANSFERS TO OTHER UNITS 7 "A" RESIDENT INSTRUCTION 36 8 "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES 40 9 "D" LOTTERY FOR EDUCATION 42 BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) - TABLE OF CONTENTS - SECTION I FINANCIAL SCHEDULES 10 CHANGES IN INVESTMENT IN PLANT 43 11 SCHEDULE OF FUND BALANCES CURRENT FUNDS AND PLANT FUNDS 44 SCHEDULES OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA 12 "A" RESIDENT INSTRUCTION 46 13 "B" OTHER ORGANIZED ACTIVITIES 48 14 "D" LOTTERY FOR EDUCATION 49 15 ANALYSIS OF PRIOR YEAR'S SURPLUS FUNDS COLLECTED FROM INSTITUTIONS AND REDISTRIBUTED TO INSTITUTIONS WITH DEFICITS 50 SECTlONll AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS SECTION ill CURRENT YEARFINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS SECTION I FINANCIAL CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 January 30, 1998 Honorable Zell Miller, Governor Members of the General Assembly of Georgia Members of the Board of Regents of the University System of Georgia and Honorable Stephen R. Portch, Chancellor INDEPENDENT AUDITOR'S COMBINED REPORT ON FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION Ladies and Gentlemen: We have audited the accompanying fmancial statements (Exhibits A through D) ofthe Administrative Central Office (Oversight Unit) of the Board of Regents of the University System of Georgia as of and for the year ended June 30, 1997. These fmancial statements are the responsibility ofthe Administrative Central Office's management. Our responsibility is to express an opinion on these financial statements based on our audit. The financial statements referred to above include only the activities of the oversight unit of the Board of Regents of the University System of Georgia. Financial activities of other organizational units (the various State colleges and universities) are not included. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall fmancial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The Administrative Central Office could not provide adequate subsidiary fixed asset records which included location of equipment supporting the equipment inventory balance of$13,385,846.92 included in the total Investment in Plant balance of$138,557,625.56 reflected on the Combined Balance Sheet. Accordingly, we were unable to satisfy ourselves as to the accuracy of this amount as reflected on the financial statements at June 30, 1997. 97ARL-63X As described in Note 1 to the financial statements, Georgia Law and State budgetary policy require the Administrative Central Office to prepare its financial statements on a basis which is not consistent with generally accepted accounting principles with respect to the recording of encumbrances as expenditures and liabilities. To conform with generally accepted accounting principles, encumbrances should be recorded as a reservation offund balance. The effects on the fmancial statements ofthis departure from generally accepted accounting principles were not reasonably determinable, but are believed to be material. As disclosed in Note 1 to the fmancial statements, the Administrative Central Office did not report the liability and related expenditure for compensated absences in the current funds as required by generally accepted accounting principles. If compensated absences were reported, liabilities would be increased and fund balance would be decreased by $907,577.33 as of June 30, 1997, and the net change in fund balance for the year ended June 30, 1997, would be decreased by $116,388.06. In our opinion, except for the effect of such adjustments, if any, as might have been determined to be necessary has we been able to satisfy ourselves as to the accuracy of the equipment inventory as described in the fourth paragraph, and except for the effects on the fmancial statements of the matters discussed in the fifth and sixth paragraphs, the financial statements referred to above present fairly, in all material respects, the fmancial position of the Administrative Central Office (Oversight Unit) of the Board of Regents of the University System of Georgia as ofJune 30, 1997, and the changes in fund balances and the current operating funds revenues, expenditures, and other changes for the year then ended in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplementary information (Exhibits E through H and Schedules 1 through 15) is presented for purposes of additional analysis and is not a required part of the financial statements ofthe Administrative Central Office (Oversight Unit) of the Board of Regents of the University System of Georgia. Such information has been subjected to the auditing procedures applied in the audit ofthe fmancial statements and, in our opinion, except for the effects of the matters discussed in the fourth, fifth, and sixth paragraphs, such information is fairly presented in all material respects in relation to the financial statements taken as a whole. Respectfully submitted, CLV:cm 97ARL-63X Claude L. Vickers State Auditor FINANCIAL STATEMENTS - 1- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) COMBINED BALANCE SHEET ALL FUND GROUPS JUNE 30,1997 ASSETS Cash and Cash Equivalents Investments Accounts Receivable Prepaid Items Investment in Plant Total Assets CURRENT FUNDS UNRESTRICTED RESTRICTED ENDOWMENT AND SIMILAR FUNDS $ 18,754,448.55 $ 1,484,721.79 $ 4,370,833.93 27,218,163,45 60,856,480.72 650.00 $ 106,829,742.72 $ 1,484,721.79 $ 4,370,833.93 LIABILITIES AND FUND BALANCES Liabilities Accounts Payable Allotments Due to Other Units Benefits Payable Deposits Held in Custody for Others Capital Lease Obligations Total Liabilities Fund Balances Endowment Quasi-Endowment - Restricted Net Investment in Plant Restricted Unrestricted Total Fund Balances Total Liabilities and Fund Balances $ 4,256,714.60 58,506,763.00 20,900,000.00 $ 83,663,477.60 $ 3,612,043.20 758,790.73 $ 1,484,721.79 $ 23,166,265.12 $ 23,166,265.12 $ 1,484,721.79 $ 4,370,833.93 $ 106,829,742.72 $ 1,484,721.79 $ 4,370,833.93 The notes to the financial statements are an integral part of this statement. -2- EXHIBIT"A" PLANT FUNDS INVESTMENT UNEXPENDED IN PLANT AGENCY FUNDS TOTAL (Memorandum Only) $ 45,347,757.94 $ 9,628.00 _ _ _ _ _ $ 138,557,625.56 2,017,144.42 $ 71,974,906.63 27,218,163.45 60,866,108.72 650.00 138,557,625.56 $ 45,357,385.94 $ 138,557,625.56 $ 2,017,144.42 $ 298,617,454.36 $ 14,106,658.40 $ $ 14,106,658.40 $ $ 14,044.45 $ 2,017,144.42 18,363,373.00 58,506,763.00 20,900,000.00 2,017,144.42 14,044.45 14,044.45 $ 2,017,144.42 $ 99,801,324.87 $ 138,543,581.11 $ 31,250,727.54 $ 31,250,727.54 $ 138,543,581.11 $ 3,612,043.20 758,790.73 138,543,581.11 1,484,721.79 54,416,992.66 $ 198,816,129.49 $ 45,357,385.94 $ 138,557,625.56 $ 2,017,144.42 $ 298,617,454.36 -3- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID COMBINED STATEMENT OF CHANGES IN FUND BALANCES ALL FUND GROUPS YEAR ENDED JUNE 30, 1997 EXHIBIT"B" CURRENT FUNDS UNRESTRICTED RESTRICTED ENDOWMENT AND SIMILAR FUNDS PLANT FUNDS INVESTMENT UNEXPENDED IN PLANT TOTAL (Memorandum Onlyl REVENUES AND OTHER ADDITIONS Unrestricted Current Fund Revenues State Appropriations Lottery Proceeds Federal Grants and Contracts State Grants and Contracts Private Gifts, Grants, and Contracts Investment Income Endowment Other Realized Gains on Investments (Net) Adjustments Prior Years' Expenditures/Accounts Payable Prior Years' Checks Voided Remittance of Uncommitted Regents Scholarships from Units of the University System of Georgia Remittance of Uncommitted Regents Opportunity Grants from Units of the University System of Georgia Remittance of Surplus from Units of the University System of Georgia Year Ended June 30,1996 Expended for Piant Facilities Current Funds Plant Funds Unexpended Other Adcfltions Insurance Recoveries $ 193,711,680.43 $ 111,500.00 56,041.50 50,000.00 $ 9,628.00 62,635,728.00 1,108,364.44 290,000.00 237,324.72 9,729.94 $ 192,814,54 1,396,617.68 96,083.80 261.75 116.29 $ 193,711,680.43 9,628.00 62,747,228.00 1,164,405.94 340,000.00 237,324.72 1,406,347.62 192,814.54 96,345.55 116,29 18,111.00 18,111.00 10,936.33 10,936.33 1,390,195.54 $ 1,989,002,49 40,306,789.89 7,567,944.00 1,390,195.54 1,989,002.49 40,306,789.89 7,567,944.00 Total Revenues and Other Additions $ 195,227,007.10 $ 464,596.16 $ 192,814.54 $ 73,008,660.16 $ 42,295,792.38 $ 311.188,870.34 EXPENDITURES AND OTHER DEDUCTIONS Educational and General Expenditures $ 196,567,069.57 $ Adjustments Prior Years' Revenues/Accounts Receivable 12,432.95 Administrative Fees Allotments of Equipment, Technology and Construction Trust Funds Unrestricted Fund Balance (Surplus) Retumed to Office of Treasury and Fiscal Services Year Ended June 30, 1996 1,464,349.37 Expended for Plant Facilities Capitalized Noncapitalized DisposalslDeletionS/Adjustments 6n,972,86 $ 26,529.98 0.00 $ 40,614.18 451,439.03 $ 197,245,042.43 12,432.95 67,144.16 451,439.03 40,306,789.89 3,961,556,31 $ 1,709,563.47 1,464,349.37 40,306,789,89 3,961,556.31 1,709,563.47 Total Expenditures and Other Deductions $ 198,043,851,89 $ 704,502.84 $ 0.00 $ 44,760,399.41 $ 1,709,563.47 $ 245,218,317.61 TRANSFERS BElWEEN FUNDS Mandatory Investment Income for Endowment Principal Restricted Quasi-Endowment Funds Allocated Nonmandatory Endowment Principal for Object of Trust $ -9,729.94 $ 9,729,94 $ 752,513.74 -752,513.74 192,585.92 -192,585.92 $ 0.00 0.00 0.00 Total Transfers Between Funds $ 752,513.74 $ 182,855.98 $ -935,369.72 $ 0.00 Net Increase/(Decrease) for the Year $ -2,064,331.05 $ -57,050.70 $ -742,555.18 $ 28,248,260.75 $ 40,586,228.91 $ 65,970,552.73 FUND BALANCES JULY 1, 1996 25,230,596.17 1,541,n2.49 5,113,389.11 3,002,466.79 97,957,352.20 132,845,576.76 FUND BALANCES JUNE 30,1997 $ 23,166,265.12 $ 1,484,721.79 $ 4,370,833.93 $ 31,250,727,54 $ 138,543,581.11 $ 198,816,129.49 The notes to the financial statements are an integral part of this statement. -4- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID STATEMENT OF CURRENT FUNDS REVENUES. EXPENDITURES. AND OTHER CHANGES YEAR ENDED JUNE 30. 1997 EXHIBIT"C" UNRESTRICTED RESTRICTED TOTAL (Memorandum Only) REVENUES State Appropriations Federal Grants and Contracts State Grants and Contracts Private Grants and Contracts Endowment Income Other Sources $ 45,519,049.00 $ 148,192,631.43 $ 121,439.12 56,041.29 52,500.00 447,992.45 45,519,049.00 121,439.12 56,041.29 52,500.00 447,992.45 148,192,631.43 Total Revenues $ 193,711 ,680.43 $ 677,972.86 $ 194,389,653.29 EXPENDITURES AND MANDATORY TRANSFERS Educational and General Instruction Research Public Service Institutional Support Operation and Maintenance of Plant Scholarships and Fellowships Mandatory Transfers for: Investment Income for Endowment Principal Restricted Quasi-Endowment Funds Allocated $ 89,114.23 2,252,513.74 16,838,575.13 175,214,395.33 $ 282,151.44 1,890,319.70 -752,513.74 $ 30,954.10 647,018.76 89,114.23 2,252,513.74 16,838,575.13 175,245,349.43 282,151.44 2,537,338.46 9,729.94 9,729.94 -752,513.74 Total Expenditures and Mandatory Transfers $ 195,814,555.83 $ 687,702.80 $ 196,502,258.63 OTHER TRANSFERS AND ADDITIONS/CDEDUCTIONS) Excess of Restricted Receipts over Transfers to Revenues Transfers of Endowment Principal for Object of Trust Administrative Fees Prior Period Adjustments (Net) Remittance of Uncommitted Regents Scholarships from Units of the University System of Georgia Remittance of Uncommitted Regents Opportunity Grants from Units of the University System of Georgia Remittance of Surplus from Units of the University System of Georgia Year Ended June 30,1996 Unrestricted Fund Balance (Surplus) Returned to Office of Treasury and Fiscal Services Year Ended June 30,1996 $ -213,376.70 $ -213,376.70 192,585.92 192,585.92 -26,529.98 -26,529.98 $ 83,650.85 83,650.85 18,111.00 18,111.00 10,936.33 10,936.33 1,390,195.54 1,390,195.54 -1 ,464,349.37 -1,464,349.37 Total Other Transfers and Additions/(Deductions) $ 38,544.35 $ -47,320.76 $ -8,776.41 Net Increase/(Decrease) in Fund Balances $ -2,064,331.05 $ -57,050.70 $ -2,121,381.75 The notes to the financial statements are an integral part of this statement. -5- BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30,1997 EXHIBIT"D" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES REPORTING ENTITY The Board ofRegents ofthe University System ofGeorgia, an organizational unit ofthe State of Georgia, was created by the "Reorganization Act of 1931". As of June 30, 1997, the Board of Regents of the University System of Georgia was composed of 34 institutions (4 research university level, 2 regional university level, 13 state universities/colleges and 15 associate degree colleges), Skidaway Institute of Oceanography and an administrative central office, which is the oversight unit, responsible for implementation of Board policies and administrative support. The Board of Regents, which is composed of sixteen members appointed by the Governor and confirmed by the Senate, has constitutional authority to govern, control, and manage the University System, as reaffirmed in the approval of the revised State Constitution in 1982. These powers include the authority for program approval or discontinuance, internal reallocation of the budget, facilities construction, or closure or merger of institutions. The Chancellor is appointed by the Board of Regents as chief executive officer and serves at the pleasure of the Board. The Board of Regents ofthe University System of Georgia does not have authority to determine the amount of funding it will receive from the State of Georgia for any given fiscal year. Such authority is vested in the General Assembly of Georgia. The Board ofRegents also does not have authority to retain unexpended State appropriations (surplus) for any given fiscal year. Accordingly, the Board of Regents of the University System of Georgia is included within the State of Georgia reporting entity for financial reporting purposes because ofthe significance ofits legal, operational and financial relationship with the State of Georgia. These reporting entity relationships are defined in Section 2100 ofthe Governmental Accounting Standards Board Codification of Governmental Accounting and Financial Reporting Standards. The Administrative Central Office of the Board of Regents of the University System of Georgia is the "Oversight Unit" of the Board of Regents and performs administrative functions and provides guidance to the thirty-four (34) State colleges and universities and Skidaway Institute of Oceanography which are organizational units of the Board of Regents of the University System of Georgia. The accompanying financial statements represent only the fmancial position and results of operations of the Administrative Central Office of the Board of Regents. The financial position and results of operations of other organizational units of the Board of Regents (various State colleges and universities) are not included in these financial statements. FUND ACCOUNTING In order to ensure observance of limitations and restrictions placed on the use of the resources available to the Board of Regents, the accounts of the Administrative Central Office are maintained in accordance with the principles offund accounting. This is the procedure by which resources for various purposes are classified for accounting and reporting purposes into funds that are in accordance with activities or objectives specified. Separate accounts are maintained for each fund; however, in the accompanying fmancial statements, funds that have similar characteristics have been combined into fund groups. Accordingly, all fmancial transactions have been recorded and reported by fund group. - 6- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1997 EXHIBIT"D" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES FUND ACCOUNTING Within each fund group, the Administrative Central Office's fund balance allocations and designations represent those portions ofthe fund balances that are reserved, restricted and/or designated for specific future use by legal covenants, State policies, or institutional policies. Fund groups and funds presented in the accompanying fmancial statements are as follows: CURRENT FUNDS UNRESTRICTED - The fund used to account for those economic resources over which the Administrative CentralOffice retains full control to use for purposes of performing its primary functions. RESTRICTED - The fund used to record externally restricted funds which may only be utilized in accordance with the purposes established by their source. Restricted current funds are recorded as revenues and expenditures when expended for current operating purposes. ENDOWMENT AND SIMILAR FUNDS The fund used to account for endowment funds and quasi-endowment funds. Endowment funds are subject to the restrictions of gift instruments requiring that the principal be invested in perpetuity and income only be utilized. While quasi-endowment funds have been established by the Administrative Central Office for the same purposes as endowment funds, any portion of quasi-endowment funds may be expended. Restricted quasi-endowment funds may be expended only for the purposes established by the source of such funds. PLANT FUNDS UNEXPENDED - The fund used to account for financial resources utilized to acquire or to construct physical properties for institutional purposes. INVESTMENT IN PLANT - The fund which shows the total amounts representing the book value of all physical properties owned by the Administrative Central Office. Net Investment in Plant is an equity account showing the total book value ofphysical properties belonging to the Administrative Central Office less the amount of any indebtedness to others. AGENCY FUNDS The fund used to account for resources held by the Administrative Central Office as custodian or fiscal agent for individuals and organizations. -7- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID NOTES TO THE FINANCIAL STATEMENTS JUNE 30.1997 EXHIBIT"D" NOTE I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING Except as otherwise disclosed in these notes, the fmancial statements are prepared on the modified accrual basis of accounting, which is materially the same as the accrual basis of accounting applicable to colleges and universities prescribed in the American Institute of Certified Public Accountants' audit guide reporting model. The modified accrual basis ofaccounting is defined as that method ofaccounting in which expenditures, other than accrued interest on generallong-tenn debt, are recorded at the time liabilities are incurred and revenues are recorded when available and measurable to finance expenditures of the fiscal period. Contractual obligations for goods and services which have not been received at the end of the fiscal year are recognized as expenditures and liabilities in the accompanying financial statements. This accounting practice causes expenditure-driven grant revenues to be accrued based, in part, on the unexecuted portion of contracts for goods and services. The recognition of encumbrances as expenditures and liabilities is in conformity with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but is not consistent with generally accepted accounting principles, which provide for the recording of encumbrances as a reservation of fund balance. Further, revenue recognition for expenditure-driven grants should be based upon expenditures determined in accordance with generally accepted accounting principles. Compensated absences represent obligations ofthe Administrative Central Office relating to employees' rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulated annual leave in which payment is probable and can be reasonably estimated. The compensated absences liability of $907,577.33 and the related current year expenditure of$116,388.06 have not been reported in the current funds as required by generally accepted accounting principles. Prior period adjustments and certain other items are reported as additions to and deductions from fund balances of current funds in the accompanying financial statements. This presentation is in accordance with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but differs from generally accepted accounting principles in that immaterial adjustments should be reported as current period revenues and expenditures. The effect of this departure is deemed to be immaterial to the fair presentation of the fmancial statements. To the extent that Current Funds and Plant Funds are used to finance plant assets, the amounts so provided are accounted for as expenditures. The balances shown on the Combined Balance Sheet as Net Investment in Plant reflect the accumulated expenditures made for plant facilities through Current Funds and Plant Funds and also include expenditures made for plant facilities expended by the Georgia State Financing and Investment Commission on behalf of the Administrative Central Office. Donated fixed assets are recorded at fair market value on the date donated. Disposals are deleted at recorded values. No depreciation has been provided on physical plant and equipment. -8- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30.1997 EXHIBIT"D" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES I BASIS OF ACCOUNTING It is the policy of the Administrative Central Office to record assets acquired through capital leases as additions to Investment in Plant when received at the total acquisition cost including interest. The liability for such leases at fiscal year-end is recorded in Investment in Plant including interest. This presentation differs from generally accepted accounting principles in that the assets and the related liability resulting from capital leases should be recorded in Investment in Plant at the inception of the agreement at the net present value of the future minimum lease payments, not to exceed the fair value of the leased property. The effect of this departure is deemed to be immaterial to the fair presentation of the financial statements. The Statement of Current Funds Revenues, Expenditures, and Other Changes is a statement of financial activities of current funds related to the current reporting period. It does not purport to present the results of operations or the net income or loss for the period as would a statement of income or a statement of revenues and expenses. BUDGET The Board of Regents of the University System of Georgia - Administrative Central Office receives State appropriation allotments for units of the University System of Georgia. The appropriated budget is adopted at the departmental level and represents appropriations provided by the Amended Appropriations Act of 19961997. The appropriated budget covers current funds and plant funds, except for Auxiliary Enterprises and Student Activities which are not subject to appropriation. The budget allocation and disbursement of these funds is made to the various organizational units by the Administrative Central Office. In addition, the organizational units receive Federal funds and other funds directly and include these funds in the budget filed with the Administrative Central Office. A comparison of anticipated funds available and budgeted expenditures by budget unit object class indicates that the following object classes were overspent by the amounts identified below: "A" Resident Instruction Operating Expenses - Sponsored Operations Special Funding Initiative "B" Regents Central Office and Other Organized Activities Operating Expenses - Education, General and Departmental Services Operating Expenses - Sponsored Operations "D" Lottery For Education Capital Outlay - Albany State College $ 0.10 $ 382.675.97 $ 2.851.03 $ 501.018.76 $ 565.440.40 CASH AND CASH EQUIVALENTS Cash and Cash Equivalents consist of demand deposits, certificates of deposit and temporary investments in authorized financial institutions, and cash management pools that have the general characteristics of demand deposit accounts. - 9- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1997 EXHIBIT liD" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES INVESTMENTS Investments are recorded at cost or in the case of gifts at fair market value on the date of the gift. Funds received by the Administrative Central Office as endowments or for restricted purposes are invested according to conditions stipulated by the donor, grantor, or in accordance with the Board of Regents authorizing resolutions. Gains and losses on investment transactions are accounted for in the funds where such assets are recorded. Investments in the various investment pools maintained by the Administrative Central Office consist, in part, of repurchase agreements and certain U. S. Government Securities which include mortgage-backed securities such as collateralized mortgage obligations and adjustable rate mortgages. These mortgage-backed securities are reported as U. S. Government Securities in the disclosure note of custodial credit risk. (See Note 2 on Categorization of Investments) Investments in the investment pools are transacted by an external investment finn under direction ofan investment advisory agreement executed between the Administrative Central Office and the investment management finn. As of June 30, 1997, the Administrative Central Office had $5,329,305.00 invested in U. S. Agency mortgage-backed securities. ACCOUNTS RECEIVABLE Accounts receivable consist of appropriation allotments due from the Office of Treasury and Fiscal Services, and other receivables disclosed from information available. INVENTORIES No inventories of supplies are reported in these financial statements. Expendable supplies are recorded as expenditures at the time of purchase. MEMORANDUM ONLY - TOTAL COLUMNS The total columns on the financial statements are captioned "Memorandum Only" because they do not represent consolidated financial information and are presented only to facilitate financial analysis. The columns do not present information that reflects financial position or changes in financial position in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds belonging to the State of Georgia 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 anyone or more of the following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59: - 10- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATNE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1997 EXHIBIT "D" NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES (1) Bonds, bills, certificates of indebtedness, notes, or other direct obligations of the United States or of the State of Georgia. (2) Bonds, bills, certificates of indebtedness, notes, or other obligations of the counties or municipalities of the State of Georgia. (3) Bonds of any public authority created by the laws ofthe 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, or 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. As authorized in the Official Code of Georgia Annotated Section 50-17-53, the State Depository Board has adopted policies which allow agencies ofthe State of Georgia the option of exempting demand deposits from the collateral requirements. The treasurer of the Board of Regents is responsible for all details relative to furnishing the required depository protection for all units of the University System of Georgia. CATEGORIZATION OF DEPOSITS For purposes of analysis of custodial credit risk, cash deposits consist of all bank balances which include demand deposits and/or interest bearing accounts. The bank balances as of June 30, 1997, are categorized below in order to provide information about the extent to which such deposits are exposed to custodial credit risk: Category 1 - Amounts covered by depository insurance or collateralized with securities (at market value) held by the Administrative Central Office or by its agent in the Administrative Central Office's name. Category 2 - Amounts collateralized with securities (at market value) held by the pledging financial institution's trust department or agent in the Administrative Central Office's name. - 11 - BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1997 EXHIBIT"D" NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS CATEGORIZATION OF DEPOSITS Category 3 - Amounts collateralized with securities (at market value) held by the pledging financial institution, or by its trust department or agent but not in the Administrative Central Office's name, and amounts uncollateralized. Carrying Amount Bank Balances Risk:Categories 2 3 Cash Deposits $ 19,531,565.17 $ 19,345,506.31 $ 115,555.03 $ Investment Portfolio Accounts 1,588.515.15 0.00 0.00 13,438.44 $ 19,216,512.84 0.00 0.00 Total Cash Deposits $ 21.120,080.32 $ 19.345 506.31 $ 11555503 $ 13 43844 $ 19,21651284 CATEGORIZATION OF INVESTMENTS Investments are summarized and classified as to custodial credit risk within the three categories described below: Category 1 - Insured or registered, or securities held by the Administrative Central Office or its agent in the Administrative Central Office's name. Category 2 - Uninsured and unregistered, with securities held by the counterparty's trust department or agent in the Administrative Central Office's name. Category 3 - Uninsured and unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Administrative Central Office's name. The carrying amounts of investment balances as of June 30, 1997, are categorized below: Type of Investment Risk Categories 2 3 Carrying Amount Market Value Common Stock $ Corporate Bonds U. S. Government Securities 0.00 $ 17,592,090.04 $ 5,444,078.70 103,150.930.81 0.00 $ 17,592,090.04 $ 34,537,685.58 5,444,078.70 5,453,893.25 103.150,930.81 103.380,289.42 Total Investments $'=====l!0~.0~0 $126187,099.55 $'=====l!0~0~0 $126,187,099.55 $143.37186825 Less: Investments Held for Units of the University System of Georgia, Cooperative Organizations and Other 48.114.109.79 $ 78.072.989 76 - 12 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30,1997 EXHIBIT"D" NOTE 3: INVESTMENT IN PLANT The following is a summary of Investment in Plant fixed assets as of June 30, 1997: Land Equipment Library Books and Collections Construction in Progress $ 2,501,877.00 13,385,846.92 31,384.30 122,638,517.34 Total Investment in Plant $138.557.625.56 NOTE 4: OPERATING LEASES The Administrative Central Office has entered into certain computer software license agreements which are classified as operating leases (leases on assets not recorded on the balance sheet). These leases generally contain provisions that, at the expiration date of the original term of the lease, the Administrative Central Office has the option of renewing the lease on a year-to-year basis. Future minimum lease payments for operating leases as of June 30, 1997, are listed below. Amounts are included only for multi-year leases and for cancellable leases for which an option to renew for the subsequent fiscal year has been exercised. Fiscal Year Ending June 30 1998 $ 490,029.97 Expenditures for computer software license agreements under operating leases for the year ended June 30, 1997, totaled $542,667.96. NOTE 5: CAPITAL LEASES The Administrative Central Office acquires certain equipment through multi-year capital leases with varying terms and options. These agreements contain fiscal funding clauses in accordance with Official Code of Georgia Annotated Section 50-5-64 which prohibits the creation of a debt to the State of Georgia for the payment of any sums under such agreements beyond the fiscal year of execution if appropriated funds are not available. If renewal of such agreements is reasonably assured, however, capital leases requiring appropriation by the General Assembly of Georgia are considered noncancellable for financial reporting purposes. As of June 30, 1997, future minimum lease payments under capital leases are as follows: Fiscal Year Ending June 30 1998 14,044.45 - 13- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30,1997 EXHIBIT"D" NOTE 6: RISK MANAGEMENT The Board of Regents of the University System of Georgia maintains a self-insured program of health and dental benefits for its employees and retirees. This plan is funded jointly through premiums paid by participants covered under the plan and employer contributions paid by the Board of Regents and its organizational units. All units of the University System of Georgia share the risk of loss for claims of the Employee Health Benefits Plan. Participants are covered up to a maximum lifetime benefit of $1,000,000.00 per person and dental coverage up to an annual maximum of$I,OOO.OO per person. The Board of Regents has contracted with Blue Cross - Blue Shield to process all claims in accordance with medical coverage guidelines as established by the Board of Regents. All claims submitted by program participants are remitted directly to Blue Cross - Blue Shield from the various organizational units for verification ofcoverage, processing, and payment through a bank account maintained for this purpose by Blue Cross - Blue Shield. Blue Cross - Blue Shield maintains an eligibility file based on information furnished by the various organizational units of the University System of Georgia. A reconciliation of total estimated claims liabilities for the fiscal year ended June 30, 1997, is shown below: Unpaid Claims and Claim Adjustments July 1, 1996 $ 19,600,000.00 Incurred Claims and Claim Adjustment Expenses - Provisions for Insured Events of the Current Year 138,407,491.59 Payments - Claims and Claim Adjustment Expenses Attributable to Insured Events of the Current Year and of Prior Years 137,107,491.59 Unpaid Claims and Claim Adjustments June 30, 1997 $ 20,900,000.00 The Department ofAdministrative Services (DOAS) has the responsibility for the State of Georgia ofmaking 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 Administrative Central Office, as an organizational unit ofthe Board of Regents of the University 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. - 14 - BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1997 EXHIBIT"D" NOTE 6: RISK MANAGEMENT A self-insured program of professional liability for its employees was established by the Board of Regents of the University System of Georgia under powers authorized by the Official Code of Georgia Annotated Section 45-9-1. The program insures the employees to the extent that they are not immune from liability against personal liability for damages arising out of the performance of their duties or in any way connected therewith. The program is administered by DOAS as a Self-Insurance Fund. NOTE 7: DEFERRED COMPENSATION PLAN The State of Georgia offers its employees a deferred compensation plan in accordance with Internal Revenue Code Section 457. The plan, available to employees of the State of Georgia and county health departments, permits such employees to defer a portion of their salary until future years. Participation in the plan is optional. Participants choose the option or options in which they wish to participate. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights ofthe State of Georgia subject only to the claims of the State's general creditors. Participants' rights under the plan are equal to those of a general creditor of the State of Georgia in an amount equal to the fair market value of the deferred account for each participant. Financial information relative to the plan will be presented in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1997. A change in the Internal Revenue Code Section 457, effective August 20, 1996, requires that by January 1, 1999, all existing eligible deferred compensation plans must be held in trust for the exclusive benefit of participants and their beneficiaries. The State of Georgia's plan will be converted effective July 1, 1998. NOTE 8: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA Plan Description The Administrative Central Office participates in the Teachers Retirement System of Georgia (TRS), a costsharing multiple-employer public employee retirement system (PERS) established by the General Assembly of Georgia for the purpose ofproviding retirement allowances and other benefits for teachers of the State of Georgia. TRS provides service retirement, disability retirement, and survivor's benefits for its members. A member is eligible for service retirement after the member (1) has attained the age of 60 years and has at least ten years of creditable service, or (2) has at least 25 years of creditable service. For those members with 30 years of service or those age 60 with at least ten years of service, normal retirement benefits are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number of years of creditable service up to 40 years. Early retirement benefits are reduced by the lesser of 1/12 of 7% for each - 15 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE30, 1997 EXHIBIT "D" NOTE 8: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA Plan Description month the member is below age 60, or by 7% for each year or fraction thereof by which the member has less than 30 years of service. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement benefits also include death and disability benefits whereby the disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The benefit is based on member's creditable service (minimum of 10 years of service) and compensation up to the date of death or up to the time of disability. Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employer contributions occurs, but the member's contributions are refunded with interest. Funding Policy Employees ofthe Administrative Central Office who are covered by TRS are required to pay 5% oftheir gross earnings to TRS. The Administrative Central Office makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1997, the employer contribution rate was 11.81% for covered employees. In addition, the Administrative Central Office contributed 4.24% to the TRS on behalfof employees electing to participate in the Regents Retirement Plan. The interest rate assumption (rate of return on investments) was 7.50%. The Administrative Central Office's payroll for the year ended June 30, 1997, for employees covered by TRS was $6,348,163.02. The Administrative Central Office's total payroll for all employees was $7,685,041.67. Total contributions to the plan made during fiscal year 1997 amounted to $1,117,535.56, of which $800,125.86 was made by the Administrative Central Office and $317,409.70 was made by employees. These contributions represented 12.60% (Administrative Central Office) and 5% (employees) of covered payroll. Total contributions from all employers to TRS for the year ended June 30, 1997, were $652,928,555.00. The Administrative Central Office's contribution for the year ended June 30, 1997, of$800,125.86 was actuarially determined and represented .1225% of total contributions made by all participating employers. Actuarial and Trend Information Actuarial and historical trend information is presented in the TRS June 30, 1997, financial report which can be obtained through TRS. - 16 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30,1997 EXHIBIT"D" NOTE 8: RETIREMENT PLANS REGENTS RETIREMENT PLAN Plan Description The State of Georgia provides optional pension benefits for eligible faculty and principal administrators through a defmed contribution plan. In a defmed contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. Funding Policy State legislation requires that prior to January 1, 1997, the employer contribute 4% of the participating employee's earnable compensation, and on and after January 1, 1997, an amount equal to the normal cost contribution determined by the TRS Board ofTrustees. Since January 1, 1997, the employer contribution rate was 7.42%. Employees contribute 5% of their earnable compensation. Amounts attributable to all plan contributions are fully vested and non-forfeitable at all times. The Administrative Central Office's payroll for employees covered by the Regents Retirement Plan for the year ended June 30, 1997, was $1,188,840.74. The Administrative Central Office's total payroll for all employees was $7,685,041.67. The Administrative Central Office and the covered employees made the required contributions of$69,154.30 (5.8%) and $59,442.10 (5%), respectively. NOTE 9: LEAVE POLICIES Employees earn annual leave ranging from one and one-quarter days to one and three-quarter days each month depending upon the employees' length of continuous State service with maximum accumulation of forty-five days. Employees are paid for unused accumulated annual leave upon retirement or termination of employment. See Note 1- Basis of Accounting (Compensated Absences) Employees earn one day of sick leave each month with no maximum accumulation established. Unused accumulated sick leave does not vest with the employee and is forfeited upon retirement or termination of employment. NOTE 10: 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 expenditures which are disallowed under grant terms. The amount of expenditures which may be disallowed by the grantor cannot be determined at this time although the Board of Regents expects such amounts, ifany, to be immaterial to its overall financial position. - 17 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30,1997 EXHIBIT"D" NOTE 10: CONTINGENCIES Litigation, claims and assessments filed against the Administrative Central Office (an organizational unit of the Board of Regents of the University 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, 1997. NOTE 11: POSTEMPLOYMENT BENEFITS OTHER THAN PENSION BENEFITS Pursuant to the general powers conferred by the Official Code of Georgia Annotated Section 20-3-31, the Board of Regents of the University System of Georgia has established group health and life insurance programs for regular employees ofthe University System of Georgia. It is the policy of the Board of Regents to permit employees of the University System of Georgia eligible for retirement or that become permanently and totally disabled to continue as members ofthe group health and life insurance programs. Employees who are eligible for retirement or disability under the criteria established by the Teachers Retirement System of Georgia and who have at least ten years ofservice with the University System of Georgia are eligible for these postemployment health and life insurance benefits. Organizational units of the Board of Regents of the University System of Georgia pay the employer portion for group insurance for affected individuals. As of June 30, 1997, there were 37 employees who had retired or were disabled that were receiving these postemployment health and life insurance benefits. For the year ended June 30, 1997, the Administrative Central Office recognized as incurred $78,884.48 of expenditures, which was net of$28,965.90 ofparticipant contributions. NOTE 12: STATE MEDICAL EDUCATION BOARD The State Medical Education Board, which is administratively attached to the Administrative Central Office of the Board of Regents of the University System of Georgia, provides service cancellable loans/scholarships to eligible students who are residents of the State of Georgia and pursuing a degree in medicine. After becoming licensed physicians, recipients earn service credits by practicing their profession in a State Medical Education Board approved community. Recipients in violation of the loan/scholarship agreement are immediately liable for all funds advanced plus interest at the minimum rate of 12% per annum. At June 30, 1997, the balance ofloans/scholarships outstanding was $3,495,890.35. This balance is not reflected in these financial statements. The State Medical Education Board also administers the "Physicians for Rural Areas Assistance Program". Under this program, the Board provides service cancellable loans to physicians licensed to practice in the State of Georgia. Service credits are earned by physicians practicing in underserved rural areas of Georgia. Recipients in violation of the loan agreement are immediately liable for twice the uncredited loan amount. At June 30, 1997, the balance ofloans outstanding was $201,784.38. This balance is not reflected in these financial statements. - 18 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1997 EXHIBIT"D" NOTE 13: SIGNIFICANT TRANSACTIONS ATLANTA COMMITTEE FOR THE OLYMPIC GAMES (ACOG) CONSTRUCTION FUND The Board of Regents of the University System of Georgia entered into an agreement with ACOG to share in the cost of construction of six dormitories on the campus of Georgia Institute of Technology. Cost of the six dormitory projects, estimated at $167,700,000.00, was shared on a basis of $47,000,000.00 from ACOG and $120,700,000.00 from State funding. State funding was obtained from the sale of general obligation bonds through the Georgia State Financing and Investment Commission (GSFIC). Construction contracting and construction management was coordinated by GSFIC. Contract documents required ACOG to transfer their portion of the construction cost representing $47,000,000.00 to the Board of Regents. GSFIC requested transfer of these funds from the Board of Regents as needed for payment of construction costs. At June 30, 1997, the Board of Regents had $1,964,919.76 on deposit in Agency Funds associated with this project. GEORGIA CENTER FOR ADVANCED TELECOMMUNICATIONS TECHNOLOGY (GCATT) The Board of Regents of the University System of Georgia is administratively responsible for the GCAIT construction project located on the Georgia Institute of Technology campus. The Unexpended Plant Fund expenditures to date totaling $32,577,774.44, including $1,398,364.44 of current year expenditures, are capitalized as Construction in Progress in the Investment in Plant Fund of the Administrative Central Office. The Administrative Central Office will continue to record all expenditures related to this project as Construction in Progress. Upon completion, the Administrative Central Office will transfer the appropriate balance of the Construction in Progress account to Georgia Institute of Technology to be recorded in the Institute's Investment in Plant account. ALBANY STATE UNIVERSITY The Board of Regents of the University System of Georgia - Administrative Central Office is recording the cost of repairs and reconstruction due to extensive flood damage to the Albany State University's campus in July 1994. These expenditures are included in the Unexpended Plant Fund and capital expenditures are recorded as Construction in Progress in the Investment in Plant Fund of the Administrative Central Office. The Administrative Central Office will continue to record all capital expenditures related to this project as Construction in Progress. Upon project completion, the Administrative Central Office will transfer the appropriate balance of the Construction in Progress account to Albany State University to be recorded in the University's Investment in Plant account. The expenditures to date totaling $94,072,540.39 includes $42,910,595.94 of current year expenditures of which $38,898,798.45 was capitalized as Construction in Progress. These expenditures are funded by insurance recoveries, Federal and State grants, and State lottery appropriations. - 19 - THIS PAGE LEFT BLANK SUPPLEMENTARY INFORMAnON - 21 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) COMBINING BALANCE SHEET CURRENT FUNDS - UNRESTRICTED JUNE 30,1997 EXHIBIT"E" ASSETS Cash and Cash Equivalents Investments Accounts Receivable Prepaid Items "All RESIDENT INSTRUCTION liB" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES "Oil LOTTERY FOR EDUCATION EMPLOYEE HEALTH BENEFITS PLAN TOTAL $ 1,314,417,97 $ 40,636,340,72 488,00 615,522,09 $ 1,434,000,00 162,00 281,470,32 $ 16,543,038,17 $ 27,218,163,45 18,786,140,00 18,754,448,55 27,218,163,45 60,856,480,72 650,00 Total Assets $ 41,951,246,69 $ 2,049,684,09 $ 19,067,610,32 $ 43?61 ,201,62 $ 106,829?42,72 LIABILITIES AND FUND BALANCES Liabilities Accounts Payable Allotments Due to Other Units Benefits Payable Total Liabilities Fund Balances Unrestricted $ 1,659,931,81 $ 40,286,623.00 $ 41,946,554.81 $ 4,691,88 567,444,29 $ 1,434,000.00 2,029,338,50 $ 16,786,140,00 $ 20,900,000,00 4,256,714,60 58,506,763.00 20,900,000.00 2,001,444,29 $ 18,815,478,50 $ 20,900,000.00 $ 83,663,477.60 48,239,80 252,131,82 22,861,201,62 23,166,265,12 Total Liabilities and Fund Balances $ 41,951,246.69 $ 2,049,684,09 $ 19,067,610,32 $ 43,761,201,62 $ 106,829,742,72 See notes to the financial statements. - 22- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID COMBINING STATEMENT OF CHANGES IN FUND BALANCES CURRENT FUNDS - UNRESTRICTED YEAR ENDED JUNE 30.1997 EXHIBIT"P' JlAII RESIDENT INSTRUCTION "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES "DII LOTTERY FOR EDUCATION EMPLOYEE HEALTH BENEFITS PLAN TOTAL REVENUES AND OTHER ADDITIONS Unrestricted Current Fund Revenues Adjustments Prior Years' Expenditures/Accounts Payable Remittance of Uncommitted Regents Scholarships from Units of the University System of Georgia Remittance of Uncommitted Regents Opportunity Grants from Units of the University System of Georgia Remittance of Surplus from Units of the University System of Georgia Year Ended June 30, 1996 $ 19,884,736.n $ 4,679.94 1,037,371.05 26,598,919.29 $ 6,671,603.00 $ 140,556,421.37 $ 193,711,680.43 11,838.67 1,287.50 78,2n.69 96,083.80 18,111.00 18,111.00 10,936.33 10,936.33 179,592.23 173,232.26 1,390,195.54 Total Revenues and Other Additions $ 20,926,787.76 $ 26,819,397.52 $ 6,846,122.76 $ 140,634,699.06 $ 195,227,007.10 EXPENDITURES AND OTHER DEDUCTIONS Educational and General Expenditures Adjustments Prior Years' Revenues/Accounts Receivable Unrestricted Fund Balance (Surplus) Retumed to Office of Treasury and Fiscal Services Year Ended June 30,1996 $ 20,626,486.82 $ 10,751.75 1,036,048.35 26,561,735.16 $ 6,420,758.68 $ 142,958,088.91 $ 196,567,069.57 783.00 898.20 12,432.95 236,893.57 191.407.45 1,464,349.37 Total Expenditures and Other Deductions $ 21,673,286.92 $ 26,799,411.73 $ 6,612,166.13 $ 142,958,987.11 $ 198,043,851.89 TRANSFERS BETWEEN FUNDS Mandatory Restricted Quasi-Endowment Funds Allocated $ 752,513.74 $ 752,513.74 Net Increasel(Decrease) for the Year $ 6,014.58 $ 19,985.79 $ 233,956.63 $ -2,324,288.05 $ -2,064,331.05 FUND BALANCES JULY 1. 1996 -1,322.70 28,254.01 18,175.19 25,185.489.67 25,230,596.17 FUND BALANCES JUNE 30. 1997 $ 4,691.88 $ 48,239.80 $ 252,131.82 $ 22,861,201.62 $ 23,166,265.12 See notes to the financial statements. 23 BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE(OVERSIGHT UNID COMBINING STATEMENT OF CURRENTFUNDSREVENUES, EXPENDITURES, AND OTHERCHANGES UNRESTRICTED YEAR ENDEDJUNE 30. 1997 EXHIBIT"G" "A" RESIDENT INSTRUCTION liB" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES "0" LOTTERYFOR EDUCATION EMPLOYEE HEALTH BENEFITS PLAN TOTAL REVENUES Slate Appropriations Other Sources $ 13,235,688.00 $ 6,649,048.77 25,611,758.00 $ 6,671,603.00 $ 45,519,049.00 987,161.29 $ 140,556.421.37 148,192,631.43 Tolal Revenues $ 19,884,736.77 $ 26,598,919.29 $ 6,671,603.00 $ 140,556,421.37 $ 193,711,680.43 EXPENDITURES AND MANDATORY TRANSFER Educationaland General Instruction Research Public Service InstitutionalSupport Operationand Maintenanceof Plant Scholarshipsand Fellowships MandatoryTransfer for: RestrictedQuasi-Endowment Funds Allocated $ 89,114.23 2,252,513.74 22,870.13 $ 18,261,988.72 -752,513.74 16,815,705.00 7,573,559.02 $ 282,151.44 1,890,319.70 $ 89,114.23 2,252,513.74 16,838,575.13 6,420,758.68 $ 142,958,088.91 175,214,395.33 282,151.44 1,890,319.70 -752,513.74 Tolal Expendituresand MandatoryTransfer $ 19,873,973.08 $ 26,561,735.16 $ 6,420,758.68 $ 142,958,088.91 $ 195,814,555.83 OTHERTRANSFERS AND ADDITIONS! (DEDUCTIONS) Prior PeriodAdjustments(Net) Remittanceof Uncommitted RegentsScholarships from Units of the UniversitySystemof Georgia Remittanceof Uncommitted Regents OpportunityGrants from Units of the UniversitySystemof Georgia Remittanceof Surplus from Units of the UniversitySystem of Georgia Year Ended June 30,1996 UnrestrictedFund Balance (SurplUS) Returnedto Office of Treasury and Fiscal Services Year Ended June 30,1996 $ -6,071.81 $ 1,037,371.05 -1,036,048.35 11,055.67 $ 18,111.00 1,287.50 $ 10,936.33 179,592.23 173,232.26 77,379.49 $ 83,650.85 18,111.00 10,936.33 1,390,195.54 -236,893.57 -191,407.45 -1.464,349.37 Tolal Other Transfers and Additionsl(Deductions) $ -4,749.11 $ -17,198.34 $ -16,887.69 $ 77,379.49 $ 38,544.35 Net Increase!(Decrease) in Fund Balances $ 6,014.58 $ 19,985.79 $ 233,956.63 $ -2,324,288.05 $ -2p64,331.05 See notes to the financial statements. - 24- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) COMBINING STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES, AND OTHER CHANGES RESTRICTED YEAR ENDED JUNE 30,1997 "A" RESIDENT INSTRUCTION "8" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES REVENUES Federal Grants and Contracts State Grants and Contracts Private Grants and Contracts Endowment Income $ $ 28,454.10 2,500.00 121,439.12 $ 27,587.19 50,000,00 447,992.45 Total Revenues $ 30,954.10 $ 647,018,76 $ EXPENDITURES AND MANDATORY TRANSFER Educational and General Institutional Support Scholarships and Fellowships Mandatory Transfer for: Investment Income for Endowment Principal $ 30,954.10 $ $ 647,018.76 9,729.94 Total Expenditures and Mandatory Transfer $ 30,954,10 $ 656,748.70 $ OTHER TRANSFERS AND ADDITIONS/(DEDUCTIONS) Excess of Restricted Receipts over Transfers to Revenues Transfers of Endowment Principal for Object of Trust Administrative Fees $ -2,500.00 $ -210,876.70 $ 192,585.92 -26,529.98 Total Other Transfers and Additions/(Deductions) $ -2,500.00 $ -44,820.76 $ EXHIBIT"H" TOTAL 121,439,12 56,041.29 52,500.00 447,992.45 677,972.86 30,954,10 647,018,76 9.129.94 687,702.80 -213,376,70 192,585.92 -26,529.98 -47,320,76 Net Increase/(Decrease) in Fund Balances $ -2,500.00 $ -54,550.70 $ =====--5=7=,0=5=0=,7=0= See notes to the financial statements. - 25 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET nAn RESIDENT INSTRUCTION YEAR ENDED JUNE 30,1997 REVENUES State Appropriation Other Revenues Retained CURRENT FUNDS UNRESTRICTED RESTRICTED TOTAL $ 13,235,688.00 6,649.048.77 $ $ 30.954.10 13,235,688.00 6,680.002.87 $ 19,884.736.77 $ 30.954.10 $ 19.915,690.87 EXPENDITURES Personal Services: Education. General and Departmental Services Operating Expenses: Education, General and Departmental Services Sponsored Operations Special Funding Initiative Research Consortium $ 3,743,373.92 $ 3,743.373.92 10,439,730.19 $ 4.190.868.97 2.252.513.74 30.954.10 10,439,730.19 30,954.10 4.190.868,97 2,252.513.74 $ 20.626.486.82 $ 30.954.10 $ 20.657,440.92 Excess of Revenues over Expenditures $ -741,750.05 $ (1) To reclassify balance of current year transfers of restricted appropriations from Georgia Eminent Scholars Endowment Trust Fund. 0.00 $ ==:::i:::-:7::4:=1=.7=5=0=.0=5= See notes to the financial statements. - 26- SCHEDULE "1" ADJUSTMENTS (1) TOTAL (Budget Basis) BUDGET VARIANCEFAVORABLE (UNFAVORABLE) $ 0.00 $ 13,235,688.00 $ 13,235,688.00 $ 0.00 6,680,002.87 7,642,311.00 -962,308.13 $ ---:O~.O..;;..O $ 19,915,690.87 $ 20,877,999.00 $ -962-,'3-0_8.1_3 $ 3,743,373.92 $ 3,789,283.00 $ 45,909.08 10,439,730.19 11,749,569.00 30,954.10 30,954.00 4,190,868.97 3,808,193.00 $ -752,513.74 1,500,000.00 1,500,000.00 1,309,838.81 -0.10 -382,675.97 0.00 $ -752,513.74 $ 19,904,927.18 $ 20,877,999.00 $ 97~ 3,07_1.8_2 $ 752,513.74 $ ======1=0=,7=6=3=.6=9= 10,763.69 - 27- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30,1997 SCHEDULE "2" REVENUES State Appropriation Other Revenues Retained CURRENT FUNDS UNRESTRICTED RESTRICTED PLANT FUNDS UNEXPENDED TOTAL (Budget Basis) BUDGET VARIANCEFAVORABLE (UNFAVORABLE) $ 25,611,758.00 987,161.29 $ $ 25,611,758.00 $ 25,611,758.00 $ 647,018.76 $ 72,998,654.12 74,632,834.17 76,282,540.00 0.00 -1,649,705.83 $ 26,598,919.29 $ 647,018.76 $ 72,998,654.12 $ 100,244,592.17 $ 101,894,298.00 $ -1,649,705.83 EXPENDITURES Personal Services: Education, General and Departmental Services Operating Expenses: Education, General and Departmental Services Sponsored Operations Capital Outlay SREB Payments Medical Scholarships Regents Opportunity Grants Regents Scholarships Rental Payments to Georgia M~itary College Direct Payments to the Georgia Public Telecommunications Commission for Operations $ 5,515,912.33 2,045,905.03 $ 866,350.00 1,384,212.80 600,000.00 200,000.00 1,122,866.00 14,826,489.00 $ 5,515,912.33 $ 5,519,671.00 $ 647,018.76 $ 43,702,905.80 2,045,905.03 647,018.76 43,702,905.80 866,350.00 1,384,212.80 600,000.00 200,000.00 1,122,866.00 2,043,054.00 146,000.00 75,000,000.00 898,000.00 1,538,218.00 600,000.00 200,000.00 1,122,866.00 14,826,489.00 14,826,489.00 3,758.67 -2,851.03 -501,018.76 31,297,094.20 31,650.00 154,005.20 0.00 0.00 0.00 0.00 $ 26,561,735.16 $ 647,018.76 $ 43,702,905.80 $ 70,911,659.72 $ 101,894,298.00 $ 30,982,638.28 Excess of Revenues over Expenditures $ 37,184.13 $====0:;;.0=0 $ 29,295,748.32 $ 29,332,932.45 $ 29,332,932.45 See notes to the financial statements. - 28- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET "D" LOTTERY FOR EDUCATION YEAR ENDED JUNE 30,1997 SCHEDULE "3" REVENUES State Appropriation CURRENT FUNDS UNRESTRICTED PLANT FUNDS UNEXPENDED TOTAL (Budget Basis) BUDGET VARIANCE FAVORABLE (UNFAVORABLE) $ 6,671,603.00 $ 9,628.00 $ 6,681,231.00 $ 6,681,231.00 $ 0.00 EXPENDITURES Equipment, Technology and Construction Trust Fund Capital Outlay - Albany State College Chehaw Education Center $ Georgia Public Telecommunications Commission Special Funding Initiatives Mercer University Grant - Equipment $ 2,000,000.00 1,500,000.00 2,920,758.68 0.00 $ 565,440.40 0.00 $ 565,440.40 2,000,000.00 9,628.00 $ 0.00 2,000,000.00 1,500,000,00 1,500,000.00 2,920,758.68 2,921,603.00 0.00 0.00 250,000.00 9,628.00 -565,440.40 0.00 0.00 844,32 250,000,00 $ 6,420,758,68 $ 565,440,40 $ 6,986,199.08 $ 6,681,231.00 $ _ _-..3..0;;4.;,;9,.6,;8,,,:0;;8.;=~ Excess of Revenues over Expenditures $ 250,844.32 $ -555,812,40 $ -304,968.08 -304,968,08 See notes to the financial statements. - 29- THIS PAGE LEFT BLAHK BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF APPROVED BUDGET "A" RESIDENT INSTRUCTION YEAR ENDED JUNE 30.1997 SCHEDULE "4" REVENUES State Appropriation Other Revenues Retained ORIGINAL APPROPRIATION AMENDED APPROPRIATION BUDGET ADJUSTMENTS TOTAL APPROVED BUDGET LESS: BUDGET TRANSFERS TO OTHER UNITS TOTAL $ 1,163,028,475.00 $ 753,070,781.00 -614,195.00 $ 205,301.00 $ 1,162,619,581.00 $ 1,149,383,893.00 $ 13,235,688.00 712,986,169.00 1,466,056,950.00 1,458,414,639.00 7,642,311.00 $ 1,916,099,256.00 $ -614,195.00 $ 713,191,470.00 $ 2,628,676,531.00 $ 2,607,798,532.00 $ 20,8n,999.00 EXPENDITURES Personal Services: Education, General and Departmental Services Sponsored Operations Operating Expenses: Education, General and Departmental Services Sponsored Operations Capital Outlay Special Funding Initiative Office of Minority Business Enterprise Student Education Enrichment Program Forestry Research Research Consortium $ 1,241,429,484.00 $ 204,000,000.00 295,648,162.00 146,000,000.00 20,352,506.00 1,276,046.00 359,714.00 388,344.00 6,645,000.00 -607,015.00 $ 2,829,296.00 $ 1,243,651,765.00 $ 1,239,862,482.00 $ 3,789,283.00 -8,219,226.00 195,780,n4.00 195,780,n4.00 0.00 7,180.00 71,673,684.00 436,062,982.00 210,844,734.00 367,314,666.00 582,062,982.00 210,844,734.00 20,352,506.00 1,276,046.00 359,714.00 388.344.00 6,645,000.00 355,565,097.00 582,032,028.00 210,844,734.00 16,544,313.00 1,276,046.00 359,714.00 388,344.00 5,145,000.00 11,749,569.00 30,954.00 0.00 3.808,193.00 0.00 0.00 0.00 1,500.000.00 $ 1,916,099,256.00 $ -614,195.00 $ 713,191,470.00 $ 2.628,676,531.00 $ 2.607,798,532.00 $ 20,877,999.00 See notes to the financial statements. - 31 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE {OVERSIGHT UNID SCHEDULE OF APPROVED BUDGET "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30.1997 REVENUES State Appropriation Other Revenues Retained EXPENDITURES Personal Services: Education, General and Departmental Services Sponsored Operations Operating Expenses: Education, General and Departmental Services Sponsored Operations Capital Outlay Agricultural Research Advanced Technology Development Center Capitation Contracts for Family Practice Residency Residency Capitation Grants Student Preceptorships Mercer Medical School Grant Morehouse School of Medicine Grant Center for Rehabilitation Technology SREB Payments Medical Scholarships Regents Opportunity Grants Regents Scholarships Rental Payments to Georgia Military College CRT Inc. Contract at Georgia Tech Research Institute Area Health Education Centers Direct Payments to the Georgia Public Telecommunications Commission for Operations See notes to the financial statements. ORIGINAL APPROPRIATION AMENDED APPROPRIATION GOVERNOR'S EMERGENCY FUNDS $ 174,879,707.00 $ 383,848,110.00 1,046,783.00 $ 45,000.00 $ 558,727,817.00 $ 1,046,783.00 $ =======45~,0=00=.0=0 $ 274,341,856.00 $ 69,874,000.00 -71,879.00 127,194,177.00 38,184,000.00 2,397,136.00 2,062,129.00 3,864,204.00 2,119,378.00 146,400.00 7,000,000.00 5,868,890.00 2,505,183.00 4,426,900.00 1,357,718.00 600,000.00 200,000.00 1,122,866.00 208,403.00 425,000.00 100,000.00 $ 250,000.00 771,750.00 14,829,577.00 -3,088.00 45,000.00 $ 558,727,817.00 $ 1,046,783.00 $ ====~= 45,=00=0.0=0 - 32- SCHEDULE "5" BUDGET ADJUSTMENTS TOTAL APPROVED BUDGET LESS: BUDGET TRANSFERS TO OTHER UNITS TOTAL $ 175,971,490.00 $ 150,359,732.00 $ 25,611,758.00 $ 110,794,449.00 494,642,559.00 418,360,019.00 76,282,540.00 $ 110,794,449.00 $ 670,614,049.00 $ 568,719,751.00 $ 101,894,298.00 $ -1,686,830.00 $ 272,583,147.00 $ 267,063,476.00 $ 5,519,671.00 15,477,469.00 85,351,469.00 85,351,469.00 0.00 10,934,886.00 10,436,990.00 74,750,000.00 160,235.00 541,199.00 180,500.00 138,274,063.00 48,620,990.00 75,000,000.00 2,397,136.00 2,222,364.00 3,864,204.00 2,119,378.00 146,400.00 7,000,000.00 5,868,890.00 3,046,382.00 5,198,650.00 1,538,218.00 600,000.00 200,000.00 1,122,866.00 208,403.00 425,000.00 136,231,009.00 48,474,990.00 2,397,136.00 2,222,364.00 3,864,204.00 2,119,378.00 146,400.00 7,000,000.00 5,868,890.00 3,046,382.00 4,300,650.00 208,403.00 425,000.00 2,043,054.00 146,000.00 75,000,000.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 898,000.00 1,538,218.00 600,000.00 200,000.00 1,122,866.00 0.00 0.00 14,826,489.00 14,826,489.00 $ 110,794,449.00 $ 670,614,049.00 $ 568,719,751.00 $ 101,894,298.00 - 33- THIS PAGE LEFT BLAHK BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF APPROVED BUDGET "0" LOTIERY FOR EDUCATION YEAR ENDED JUNE 30. 1997 SCHEDULE "6" REVENUES State Appropriation ORIGINAL APPROPRIATION AMENDED APPROPRIATION BUDGET ADJUSTMENTS TOTAL APPROVED BUDGET LESS: BUDGET TRANSFERS TO OTHER UNITS TOTAL $ 50,254,000.00 $ 28,250,000.00 $ ======O=.O~O $ 78,504,000.00 $ 71,822,769.00 $ 6,681,231.00 EXPENDITURES Equipment, Technology and Construction Trust Fund ChehawEducation Center GeorgiaPublicTelecommunications Commission GeorgiaResearchAlliance SpecialFundingInitiatives MercerUniversityGrant Equipment $ 16,400,000.00 2,000,000.00 $ 12,804,964.00 $ 29,204,964.00 $ 2,000,000.00 1,500,000.00 20,254,000.00 $ 10,100,000.00 28,000,000.00 250,000.00 -12,804,964.00 1,500,000.00 35,449,036.00 10,100,000.00 250,000.00 29,195,336.00 $ 9,628.00 2,000,000.00 35,449,036.00 7,178,397.00 1,500,000.00 0.00 2,921,603.00 250,000.00 $ 50,254,000,00 $ 28,250,000.00 $ ======O=.O~O $ 78,504,000.00 $ 71,822,769.00 $ 6,681,231.00 See notesto the financialstatements. - 35- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS MAMRESIDENT INSTRUCTION YEAR ENDED JUNE 30.1997 UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA RESEARCH UNIVERSITIES Georgia Institute of Technology Research Consortium Regular Georgia Tech Research Institute Special Funding Initiative Regular Georgia Tech Research Institute Georgia State University Research Consortium Regular Special Funding Initiative Medical College of Georgia Student Education Enrichment Program Special Funding Initiative University of Georgia Forestry Research Office of Minority Business Enterprise Research Consortium Regular Agricultural Experiment Station Special Funding Initiative REGIONAL UNIVERSITIES Georgia Southem University Research Consortium Special Funding Initiative Valdosta State University Research Consortium Special Funding Initiative STATE UNIVERSITIES/COLLEGES Albany State University Office of Minority Business Enterprise Special Funding Initiative Armstrong AUantic State University Special Funding Initiative Augusta State University Special Funding Initiative Clayton College and State University Special Funding Initiative Columbus State University Special Funding Initiative Fort Valley State University Special Funding Initiative Georgia College and State University Special Funding Initiative Georgia Southwestem State University Special Funding Initiative Kennesaw State University Special Funding Initiative North Georgia College and State University Special Funding Initiative Savannah State University Office of Minority Business Enterprise Special Funding Initiative Southem Polytechnic State University Special Funding Initiative State University of West Georgia Special Funding Initiative PERSONAL SERVICES EDUCATION, GENERAL AND DEPARTMENTAL SPONSORED SERVICES OPERATIONS APPROVED BUDGET OPERATING EXPENSES EDUCATION, GENERAL AND DEPARTMENTAL SPONSORED SERVICES OPERATIONS $ 162,039,109.00 $ 50,229,211.00 $ 52,334,763.00 $ 56,nO,789.00 143,548,610.00 15,491,000.00 48,594,833.00 80,747,552.00 293,694,099.00 43,111,517.00 55,000,000.00 26,897,9n.00 84,353,195.00 83,509,000.00 25,044,794.00 145,000,000.00 70,673,625.00 43,894,394.00 2,997,708.00 1,384,961.00 17,167,206.00 10,138,448.00 59,524,594.00 36,171,900.00 18,049,823.00 22,296,951.00 22,692,793.00 19,146,498.00 24,465,307.00 17,282,264.00 25,540,718.00 12,573,458.00 45,1n,940.00 15,816,012.00 18,326,165.00 19,928,835.00 34,700,444.00 2,970,694.00 555,171.00 728,959.00 1,702,679.00 1,074,047.00 7,083,992.00 505,609.00 943,245.00 1,698,706.00 537,205.00 1,463,201.00 747,396.00 839,843.00 3,337,584.00 5,883,849.00 4,863,033.00 5,268,119.00 6,186,927.00 4,314,930.00 6,022,479.00 3,917,151.00 13,169,996.00 3,492,804.00 3,624,694.00 5,293,725.00 9,727,544.00 15,529,306.00 4,273,297.00 4,824,580.00 4,828,171.00 14,304,604.00 24,606,516.00 13,043,522.00 3,715,212.00 8,375,286.00 5,068,665.00 14,839,802.00 1,452,604.00. 19,145,728.00 See notes to the financial statements. - 36- SCHEDULE "7" CAPITAL OUTLAY OTHER TOTAL STATE FUNDS FUNDING PROVIDED OTHER REVENUES RETAINED TOTAL $ 11,032,733.00 $ 10,984,309.00 6,587,146.00 63,602,804.00 $ 1,313,649.00 836,390.00 1,701,047.00 41,420.00 500,000.00 950,003.00 359,714.00 1,697,874.00 388,344.00 466,046.00 2,069,601.00 209,240.00 1,134,972.00 332,406,605.00 $ 1,313,649.00 836,390.00 1,701,047.00 41,420.00 302,127,752.00 500,000.00 950,003.00 182,388,986.00 359,714.00 1,697,874.00 641,650,098.00 388,344.00 466,046.00 2,069,601.00 209,240.00 1,134,972.00 127,515,388.00 $ 1,313,649.00 836,390.00 1,701,047.00 41,420.00 131,379,046.00 500,000.00 950,003.00 89,086,467.00 359,714.00 1,697,874.00 275,578,401.00 388,344.00 466,046.00 2,069,601.00 209,240.00 1,134,972.00 204,891,217.00 $ 170,748,706.00 93,302,519.00 366,071,697.00 332,406,605.00 1,313,649.00 836,390.00 1,701,047.00 41,420.00 302,127,752.00 500,000.00 950,003.00 182,388,986.00 359,714.00 1,697,874.00 641,650,098.00 388,344.00 466,046.00 2,069,601.00 209,240.00 1,134,972.00 6,297,570.00 3,625,494.00 113,075.00 1,071,247.00 103,045.00 1,072,630.00 156,660,703.00 113,075.00 1,071,247.00 95,215,197.00 103,045.00 1,072,630.00 58,400,608.00 113,075.00 1,071,247.00 37,033,617.00 103,045.00 1,072,630.00 98,260,095.00 58,181,580.00 156,660,703.00 113,075.00 1,071,247.00 95,215,197.00 103,045.00 1,072,630.00 73,023,146.00 1,280,048.00 2,361,207.00 943,556.00 1,431,791.00 4,028,012.00 2,258,328.00 1,537,742.00 2,061,313.00 2,852,828.00 2,536,453.00 1,005,132.00 3,015,900.00 60,000.00 284,401.00 237,491.00 426,160.00 116,705.00 3,925,411.00 455,596.00 177,205.00 187,190.00 143,765.00 126,465.00 550,000.00 252,025.00 102,545.00 331,170.00 112,910,553.00 60,000.00 284,401.00 34,289,316.00 237,491.00 35,470,572.00 426,160.00 31,889,023.00 116,705.00 47,462,676.00 3,925,411.00 57,315,714.00 455,596.00 47,370,656.00 177,205.00 22,686,808.00 187,190.00 70,483,241.00 143,765.00 27,767,514.00 126,465.00 40,790,315.00 550,000.00 252,025.00 28,427,692.00 102,545.00 67,429,459.00 331,170.00 15,592,941.00 60,000.00 284,401.00 19,231,794.00 237,491.00 20,555,433.00 426,160.00 15,279,386.00 116,705.00 21,415,350.00 3,925,411.00 16,809,268.00 455,596.00 23,032,952.00 177,205.00 11,932,312.00 187,190.00 34,743,531.00 143,765.00 14,473,646.00 126,465.00 17,348,350.00 550,000.00 252,025.00 17,637,903.00 102,545.00 31,708,720.00 331,170.00 97,317,612.00 15,057,522.00 14,915,139.00 16,609,637.00 26,047,326.00 40,506,446.00 24,337,704.00 10,754,496.00 35,739,710.00 13,293,868.00 23,441,965.00 10,789,789.00 35,720,739.00 112,910,553.00 60,000.00 284,401.00 34,289,316.00 237,491.00 35,470,572.00 426,160.00 31,889,023.00 116,705.00 47,462,676.00 3,925,411.00 57,315,714.00 455,596.00 47,370,656.00 177,205.00 22,686,808.00 187,190.00 70,483,241.00 143,765.00 27,767,514.00 126,465.00 40,790,315.00 550,000.00 252,025.00 28,427,692.00 102,545.00 67,429,459.00 331,170.00 - 37- BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE(OVERSIGHT UNIT) SCHEDULE OF BUDGETTRANSFERS TO OTHER UNITS "A" RESIDENT INSTRUCTION YEAR ENDEDJUNE 30,1997 UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA ASSOCIATE DEGREECOLLEGES Abraham BaldwinAgriculturalCollege SpecialFunding Initiative Manta Metropolitan College Office of Minority BusinessEnterprise SpecialFunding Initiative BainbridgeCollege Special Funding Initiative CoastalGeorgia CommunityCollege Special Funding Initiative Dalton College SpecialFunding Initiative Darton College SpecialFunding Initiative DeKalbCollege SpecialFunding Initiative East Georgia College SpecialFunding Initiative Floyd College SpecialFunding Initiative Gainesville College Special Funding Initiative Gordon College Special Funding Initiative Macon College SpecialFunding Initiative Middle Georgia College Special Funding Initiative South Georgia College Special Funding Initiative Waycross College SpecialFunding Initiative PERSONAL SERVICES EDUCATION, GENERAL AND DEPARTMENTAL SPONSORED SERVICES OPERATIONS APPROVEDBUDGET OPERATING EXPENSES EDUCATION, GENERALAND DEPARTMENTAL SPONSORED SERVICES OPERATIONS $ 11,044,509.00 $ 6,337,109.00 3,967,474.00 6,469,205.00 8,623,305.00 9,559,046.00 45,411,488.00 2,804,597.00 9,234,678.00 9,640,OnOO 7,137,238.00 12,358,486.00 8,607,543.00 5,123,155.00 2;949,975.00 762,762.00 $ 582,254.00 2,135,036.00 $ 2,546,428.00 742,238.00 824,790.00 1,725,137.00 304,588.00 149,005.00 13,500.00 346,205.00 192,488.00 451,732.00 315,705.00 253,913.00 51,313.00 1,015,176.00 1,448,378.00 2,233,645.00 2,742,651.00 13,074,064.00 972,097.00 2,623,972.00 2,232,501.00 2,023,223.00 2,782,614.00 1,868,860.00 1,988,720.00 1,013,997.00 2,922,259.00 2,793,230.00 1,858,550.00 2,155,125.00 3,619,115.00 3,196,655.00 11,006,495.00 686,378.00 1,868,538.00 1,865,564.00 1,750,000.00 3,194,592.00 2,440,406.00 1,516,625.00 1,130,126.00 SkidawayInstitute of Oceanography Special Funding Initiative 274,478.00 ============= $ 1,239,862,482.00 $ 195,780,n4.00 $ 355,565,097.00 $ 582,032,028.00 See notes to the financial statements. - 38- SCHEDULE "7" CAPITAL OUTLAY OTHER TOTAL STATE FUNDS FUNDING PROVIDED OTHER REVENUES RETAINED TOTAL $ 1,445,369.00 $ 424,830.00 357,234.00 504,147.00 709,500.00 582,310.00 1,636,556.00 436,112.00 691,524.00 402,000.00 601,555.00 489,000.00 1.065,021.00 701.100.00 332,964.00 $ 116.215.00 200,000.00 118,430.00 93,165.00 141.510.00 95.215.00 97,010.00 470,245.00 92,665.00 95,400.00 105,340.00 94,630.00 107,018.00 141,895.00 198,643.00 96,570.00 18,309,935.00 $ 116,215.00 12,683,851.00 200,000.00 118,430.00 7,940,672.00 93,165.00 11,401,645.00 141,510.00 16.910,702.00 95,215.00 16,385,250.00 97,010.00 71,2n,608.00 470,245.00 4,912,684.00 92,665.00 14,764.917.00 95,400.00 14.332,630.00 105,340.00 11,512,016.00 94,630.00 19,276,424.00 107,018.00 14,297,535.00 141,895.00 9,583.513.00 198,643.00 5,478,375.00 96,570.00 10,853.744.00 $ 116,215.00 6,666,909.00 200,000.00 118,430.00 4,046,848.00 93.165.00 6,280.401.00 141,510.00 8,054,971.00 95.215.00 9,622.220.00 97.010.00 42,021.227.00 470.245.00 3,175.038.00 92.665.00 9,369.733.00 95.400.00 9,161.618.00 105,340.00 7,303,144.00 94,630.00 11,992,535.00 107,018.00 9,073,000.00 141,895.00 5.637,326.00 198.643.00 3,382,171.00 96,570.00 7,456.191.00 $ 6,016,942.00 3,893,824.00 5,121,244.00 8.855,731.00 6.763,030.00 29.256,381.00 1.737.646.00 5,395.184.00 5,171,012.00 4,208,872.00 7.283.889.00 5,224.535.00 3,946,187.00 2,096,204.00 18,309.935.00 116.215.00 12,683,851.00 200,000.00 118,430.00 7.940,672.00 93,165.00 11,401,645.00 141.510.00 16,910.702.00 95.215.00 16,385.250.00 97.010.00 71.277.608.00 470.245.00 4.912,684.00 92,665.00 14,764.917.00 95,400.00 14,332.630.00 105.340.00 11.512,016.00 94,630.00 19,276,424.00 107.018.00 14,297.535.00 141,895.00 9,583,513.00 198,643.00 5,478,375.00 96,570.00 45,040.00 274,478.00 45,040.00 274,478.00 45,040.00 274,478.00 45,040.00 $ 210,844,734.00 $ 23,713,417.00 $ 2,607,798,532.00 $ 1,149,383,893.00 $ 1,458,414,639.00 $ 2.607,798,532.00 39 BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNm SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30, 1997 UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA RESEARCH UNIVERSITIES Georgia Institute ofTechnology Education Extension Services Advanced Technology Development Center Georgia Tech Research Institute Agricultural Research Center for Rehabilitation Technology CRT Inc. at Georgia Tech Research Institute Medical College of Georgia Medical College of Georgia Hospital and Clinics Area Health Education Centers Joint Board of Family Practice Capitation Contracts for Family Practice Residency Residency Capitation Grants Student Preceptorships Mercer Medical School Grant Morehouse School of Medicine Grant SREB Payments Georgia Radiation Therapy Center University of Georgia Agricultural Experiment Station Athens and Tifton Veterinary Laboratories Cooperative Extension Service Marine Institute Marine Resources Extension Center Veterinary Medicine Experime'nt Station Agricultural Research Veterinary Medicine Teaching Hospital PERSONAL SERVICES EDUCATION, GENERAL AND DEPARTMENTAL SPONSORED SERVICES OPERATIONS APPROVED BUDGET OPERATING EXPENSES EDUCATION, GENERAL AND DEPARTMENTAL SPONSORED SERVICES OPERATIONS s 4,380,811.00 $ s 642,000.00 20,609,946.00 55,828,766.00 s 5,788,028.00 15,425,254.00 598,000.00 27,381,713.00 162,150,703.00 293,290.00 5,299,628,00 91,285,790.00 593,214.00 2,296,352.00 2,086,983.00 35,657,984.00 128,504.00 34,702,259.00 623,876.00 1,263,913.00 1,681,109.00 1,745,059.00 9,500,000.00 2,350,000.00 9,800,000.00 425,000.00 345,000.00 957,763.00 12,170,299.00 4,773,898.00 417,861.00 680,321.00 299,185.00 3,284,655.00 10,500,000.00 1,150,000.00 5,200,000.00 105,000.00 155,000.00 Skid away Institute of Oceanography 1,739,039.00 1,161,075.00 554,741.00 1,088,925.00 $ 267,063,476.00 $ s 85,351,469.00 136,231,009.00 $ ===-==4;8;,;4;74;,,9;9~0~.0=0= See notes to the financial statements. -40- SCHEDULE "8" OTHER TOTAL STATE FUNDS FUNDING PROVIDED OTHER REVENUES RETAINED TOTAL $ 11,408,839.00 $ 555,628.00 $ 10,853,211.00 $ 11,408,839.00 $ 2,222,364.00 2,222,364.00 2,062,129.00 160,235.00 2,222,364.00 119,245,679.00 11,062,872.00 108,182,807.00 119,245,679.00 1,489,499.00 1,489,499.00 1,489,499.00 1,489,499.00 3,046,382.00 3,046,382.00 796,183.00 2,250,199.00 3,046,382.00 208,403.00 208,403.00 208,403.00 208,403.00 425,000.00 3,864,204.00 2,119,378.00 146,400.00 7,000,000.00 5,868,890.00 4,300,650.00 261,032,473.00 425,000.00 886,504.00 3,864,204.00 2,119,378.00 146,400.00 7,000,000.00 5,868,890.00 4,300,650.00 3,044,746.00 32,956,551.00 886,504.00 3,864,204.00 2,119,378.00 146,400.00 7,000,000.00 5,868,890.00 4,300,650.00 228,075,922.00 425,000.00 3,044,746.00 261,032,473.00 425,000.00 886,504.00 3,864,204.00 2,119,378.00 146,400.00 7,000,000.00 5,868,890.00 4,300,650.00 3,044,746.00 907,637.00 67,828,283.00 3,628,504.00 54,476,157.00 1,571,737.00 2,444,234.00 1,980,294.00 907,637.00 5,029,714.00 38,452,317.00 128,504.00 31,398,407.00 976,989.00 1,359,434.00 1,980,294.00 907,637.00 527,752.00 29,375,966.00 3,500,000.00 23,077,750.00 594,748.00 1,084,800.00 4,501,962.00 67,828,283.00 3,628,504.00 54,476,157.00 1,571,737.00 2,444,234.00 1,980,294.00 907,637.00 5,029,714.00 4,543,780.00 1,519,510.00 3,024,270.00 4,543,780.00 $ 31,598,807.00 $ 568,719,751.00 $ 150,359,732.00 $ 418,360,019.00 $ 568,719,751.00 41 BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNm SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS "D" LOTTERY FOR EDUCATION YEAR ENDED JUNE 30 1997 SCHEDULE "9" UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA APPROVED BUDGET EQUIPMENT, TECHNOLOGY AND GEORGIA CONSTRUCTION RESEARCH TRUST FUND ALLIANCE SPECIAL FUNDING INITIATIVES TOTAL FUNDING PROVIDED STATE FUNDS RESEARCH UNIVERSITIES Georgia Institute ofTechnology Georgia State University Medical College of Georgia University of Georgia $ 9,811,738.00 $ 11,902,566.00 $ 88,993.00 $ 21,803,297.00 $ 21,803,297.00 5,550,326.00 4,463,982.00 98,800.00 10,113,108.00 10,113,108.00 1,690,900.00 1,200,000.00 92,565.00 2,983,465.00 2,983,465.00 6,159,000.00 17,882,488.00 834,235.00 24,875,723.00 24,875,723.00 REGIONAL UNIVERSITIES Georgia Southern University Valdosta State University 557,372.00 494,000.00 261,820.00 665,068.00 819,192.00 1,159,068.00 819,192.00 1,159,068.00 STATE UNIVERSITIES/COLLEGES Albany State University Armstrong Atlantic State University Augusta State University Clayton College and State University Columbus State University Fort Valley State University Georgia College and State University Georgia Southwestern State University Kennesaw State University North Georgia College and State University Savannah State University Southern Polytechnic State University State University of West Georgia 204,000.00 269,000.00 269,000.00 269,000.00 269,000.00 134,000.00 269,000.00 134,000.00 344,000.00 134,000.00 204,000.00 204,000.00 344,000.00 184,469.00 268,195.00 159,000.00 165,500.00 176,000.00 174,000.00 193,500.00 165,000.00 166,000.00 159,000.00 159,000.00 165,500.00 224,152.00 388,469.00 537,195.00 428,000.00 434,500.00 445,000.00 308,000.00 462,500.00 299,000.00 510,000.00 293,000.00 363,000.00 369,500.00 568,152.00 388,469.00 537,195.00 428,000.00 434,500.00 445,000.00 308,000.00 462,500.00 299,000.00 510,000.00 293,000.00 363,000.00 369,500.00 568,152.00 ASSOCIATE DEGREE COLLEGES Abraham Baldwin Agricultural College Atlanta Metropolitan College Bainbridge College Coastal Georgia Community College Dalton College Darton College DeKalb College East Georgia College Floyd College Gainesville College Gordon College Macon College Middle Georgia College South Georgia College Waycross College 134,000.00 64,000.00 64,000.00 64,000.00 169,000.00 134,000.00 344,000.00 29,000.00 169,000.00 134,000.00 134,000.00 169,000.00 134,000.00 64,000.00 29,000.00 245,000.00 181,500.00 161,500.00 226,000.00 161,500.00 180,200.00 238,400.00 155,000.00 155,000.00 171,500.00 155,000.00 155,000.00 186,000.00 155,000.00 175,000.00 379,000.00 245,500.00 225,500.00 290,000.00 330,500.00 314,200.00 582,400.00 184,000.00 324,000.00 305,500.00 289,000.00 324,000.00 320,000.00 219,000.00 204,000.00 379,000.00 245,500.00 225,500.00 290,000.00 330,500.00 314,200.00 582,400.00 184,000.00 324,000.00 305,500.00 289,000.00 324,000.00 320,000.00 219,000.00 204,000.00 QI!::!gR Skidaway Institute of Oceanography 50,000.00 76,000.00 126,000.00 126,000.00 $ 29,195,336.00 $ 35,449,036.00 $ 7,178,397.00 $ 71,822,769.00 $ 71,822,769.00 See notes to the financial statements. -42 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) CHANGES IN INVESTMENT IN PLANT YEAR ENDED JUNE 30. 1997 SCHEDULE "10" Land Equipment Library Books and Collections Construction in Progress BALANCE JULY 1,1996 ADDITIONS CURRENT FUNDS PLANT FUNDS UNRESTRICTED UNEXPENDED DEDUCTIONS DISPOSALS! DELETIONS! ADJUSTMENTS BALANCE JUNE 30, 1997 $ 2,492,250.00 $ 9,627.00 $ 2,501,877.00 13,169,102.10 $ 1,989,002.49 $ 1,772,257.67 13,385,846.92 31,384.30 31,384.30 82,341,354.45 40,297,162.89 122,638,517.34 $ 98,034,090.85 $ 1,989,002.49 $ 40,306,789.89 $ 1,772,257.67 $ 138,557,625.56 SUMMARY OF INVESTMENT Administrative Central Office Capital Leases $ 97,957,352.20 $ 76,738.65 1,989,002.49 $ 40,306,789.89 $ 1,709,563.47 $ 138,543,581.11 62,694.20 14,044.45 $ 98,034,090.85 $ 1,989,002.49 $ 40,306,789.89 $ 1,772,257.67 $ 138,557,625.56 See notes to the financial statements. -43 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF FUND BALANCES CURRENT FUNDS AND PLANT FUNDS JUNE 30,1997 NET INVESTMENT IN PLANT Investment in Plant Facilities RESTRICTED Designated for SUbsequent Years' Expenditures UNRESTRICTED Designated For Capital Outlay - Albany State University Flood Recovery Project For Equipment, Technology and Construction Trust Fund For Property Reserve For Mercer University Grant - Equipment For Employee Health Benefits Plan Surplus Regular Lottery for Education "Alf RESIDENT INSTRUCTION CURRENT FUNDS UNRESTRICTED "B" REGENTS CENTRAL OFFICE AND "Du OTHER ORGANIZED LOTIERYFOR ACTIVITIES EDUCATION $ 250,000.00 $ 4,691.88 $ $ 4,691.88 $ $ 4,691.88 $ 48,239.80 48,239.80 $ 2,131.82 252,131.82 48,239.80 $ ==:::;;;;:2,=52=,=13=1=.8=2= See notes to the financial statements. -44 - SCHEDULE "11" EMPLOYEE HEALTH BENEFITS PLAN RESTRICTED PLANT FUNDS UNEXPENDED LOTIERYFOR REGULAR EDUCATION INVESTMENT IN PLANT TOTAL $ 138,543,581.11 $ 138,543,581.11 1,484,721.79 1,484,721.79 $ 22,861,201.62 $ 29,151,639.68 $ 2,088,681.05 10,028.77 $ 29,151,639.68 10,028.77 2,088,681.05 250,000.00 22,861,201.62 $ 22,861,201.62 378.04 $ 31,240,698.77 $ 10,028.77 53,309.72 2,131.82 $ 54,416,992.66 $ 22,861,201.62 $ 1,484,721.79 $ 31,240,698.77 $ 10,028.77 $ 138,543,581.11 $ 194,445,295.56 - 45- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA "A" RESIDENT INSTRUCTION YEAR ENDED JUNE 30. 1997 RESEARCH UNIVERSITIES Georgia Institute of Technology Georgia State University Medical College of Georgia University of Georgia REGIONAL UNIVERSITIES Georgia Southern University Valdosta State University STATE UNIVERSITIES/COLLEGES Albany State University Armstrong Atlantic State University Augusta State University Clayton College and State University Columbus State University Fort Valley State University Georgia College and State University Georgia Southwestern State University Kennesaw State University North Georgia College and State University Savannah State University Southern Polytechnic State University State University of West Georgia ASSOCIATE DEGREE COLLEGES Abraham Baldwin Agricultural College Atlanta Metropolitan College Bainbridge College Coastal Georgia Community College Dalton College Darton College DeKalb College East Georgia College Floyd College Gainesville College Gordon College Macon College Middle Georgia College South Georgia College Waycross College OTHER Skidaway Institute of Oceanography REGULAR SPECIAL FUNDING INITIATIVE OFFICE OF MINORITY BUSINESS ENTERPRISE $ 127,515,388.00 $ 131,379,046.00 89,086,467.00 275,578,401.00 1,742,467.00 950,003.00 1,697,874.00 1,134,972.00 $ 466,046.00 58,400,608.00 37,033,617.00 1,071,247.00 1,072,630.00 15,592,941.00 19,231,794.00 20,555,433.00 15,279,386.00 21,415,350.00 16,809,268.00 23,032,952.00 11,932,312.00 34,743,531.00 14,473,646.00 17,348,350.00 17,637,903.00 31,708,720.00 284,401.00 237,491.00 426,160.00 116,705.00 3,925,411.00 455,596.00 177,205.00 187,190.00 143,765.00 126,465.00 252,025.00 102,545.00 331,170.00 60,000.00 550,000.00 10,853,744.00 6,666,909.00 4,046,848.00 6,280,401.00 8,054,971.00 9,622,220.00 42,021,227.00 3,175,038.00 9,369,733.00 9,161,618.00 7,303,144.00 11,992,535.00 9,073,000.00 5,637,326.00 3,382,171.00 116,215.00 118,430.00 93,165.00 141,510.00 95,215.00 97,010.00 470,245.00 92,665.00 95,400.00 105,340.00 94,630.00 107,018.00 141,895.00 198,643.00 96,570.00 200,000.00 274,478.00 45,040.00 $ 1,125,670,476.00 $ 16,544,313.00 $ 1,276,046.00, See notes to the financial statements. - 46- SCHEDULE "12" STUDENT EDUCATION ENRICHMENT PROGRAM FORESTRY RESEARCH RESEARCH CONSORTIUM TOTAL $ 2,150,039.00 $ 131,407,894.00 500,000.00 132,829,049.00 $ 359,714.00 91,144,055.00 $ 388,344.00 2,278,841.00 279,846,604.00 113,075.00 103,045.00 59,584,930.00 38,209,292.00 15,937,342.00 19,469,285.00 20,981,593.00 15,396,091.00 25,340,761.00 17,264,864.00 23,210,157.00 12,119,502.00 34,887,296.00 14,600,111.00 18,150,375.00 17,740,448.00 32,039,890.00 10,969,959.00 6,985,339.00 4,140,013.00 6,421,911.00 8,150,186.00 9,719,230.00 42,491,472.00 3,267,703.00 9,465,133.00 9,266,958.00 7,397,774.00 12,099,553.00 9,214,895.00 5,835,969.00 3,478,741.00 319,518.00 $ 359,714.00 $ 388,344.00 $ 5,145,000.00 $ 1,149,383,893.00 -47 - BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA "B" OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30, 1997 SCHEDULE "13" RESEARCH UNIVERSITIES Georgia Institute of Technology Education Extension Services Advanced Technology Development Center Georgia Tech Research Institute Agricultural Research Center for Rehabilitation Technology Medical College of Georgia Medical College of Georgia Hospital and Clinics Joint Board of Family Practice Capitation Contracts For Family Practice Residency Residency Capitation Grants Student Preceptorships Mercer Medical School Grant Morehouse School of Medicine Grant SREB Payments University of Georgia Agricultural Experiment Station Athens and Tifton Veterinary Laboratories Cooperative Extension Service Marine Institute Marine Resources Extension Center Veterinary Medicine Experiment Station Agricultural Research Veterinary Medicine Teaching Hospital OTHER Skidaway Institute of Oceanography $ 555,628.00 2,062,129.00 11,062,872.00 1,489,499.00 796,183.00 $ 15,966,311.00 $ 32,956,551.00 886,504.00 3,864,204.00 2,119,378.00 146,400.00 7,000,000.00 5,868,890.00 4,300,650.00 $ 57,142,577.00 $ 38,452,317.00 128,504.00 31,398,407.00 976,989.00 1,359,434.00 1,980,294.00 907,637.00 527,752.00 $ 75,731,334.00 $ 1,519,510.00 $ 150,359,732.00 See notes to the financial statements. -48- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA "0" LOTIERY FOR EDUCATION YEAR ENDED JUNE 30, 1997 SCHEDULE "14" RESEARCH UNIVERSITIES Georgia Institute of Technology Georgia State University Medical College of Georgia University of Georgia REGIONAL UNIVERSITIES Georgia Southern University Valdosta State University STATE UNIVERSITIES/COLLEGES Albany State University Armstrong Atlantic State University Augusta State University Clayton College and State University Columbus State University Fort Valley State University Georgia College and State University Georgia Southwestern State University Kennesaw State University North Georgia College and State University Savannah State University Southern Polytechnic State University State University of West Georgia ASSOCIATE DEGREE COLLEGES Abraham Baldwin Agricultural College Atlanta Metropolitan College Bainbridge College Coastal Georgia Community College Dalton College Darton College DeKalb College East Georgia College Floyd College Gainesville College Gordon College Macon College Middle Georgia College South Georgia College Waycross College OTHER Skidaway Institute of Oceanography EQUIPMENT, TECHNOLOGY AND CONSTRUCTION TRUST FUND APPROVED BUDGET GEORGIA RESEARCH ALLIANCE SPECIAL FUNDING INITIATIVES TOTAL $ 9,811,738.00 $ 11,902,566.00 $ 5,550,326.00 4,463,982.00 1,690,900.00 1,200,000.00 6,159,000.00 17,882,488.00 88,993.00 $ 98,800.00 92,565.00 834,235.00 21,803,297.00 10,113,108.00 2,983,465.00 24,875,723.00 557,372.00 494,000.00 261,820.00 665,068.00 819,192.00 1,159,068.00 204,000.00 269,000.00 269,000.00 269,000.00 269,000.00 134,000.00 269,000.00 134,000.00 344,000.00 134,000.00 204,000.00 204,000.00 344,000.00 184,469.00 268,195.00 159,000.00 165,500.00 176,000.00 174,000.00 193,500.00 165,000.00 166,000.00 159,000.00 159,000.00 165,500.00 224,152.00 388,469.00 537,195.00 428,000.00 434,500.00 445,000.00 308,000.00 462,500.00 299,000.00 510,000.00 293,000.00 363,000.00 369,500.00 568,152.00 134,000.00 64,000.00 64,000.00 64,000.00 169,000.00 134,000.00 344,000.00 29,000.00 169,000.00 134,000.00 134,000.00 169,000.00 134,000.00 64,000.00 29,000.00 245,000.00 181,500.00 161,500.00 226,000.00 161,500.00 180,200.00 238,400.00 155,000.00 155,000.00 171,500.00 155,000.00 155,000.00 186,000.00 155,000.00 175,000.00 379,000.00 245,500.00 225,500.00 290,000.00 330,500.00 314,200.00 582,400.00 184,000.00 324,000.00 305,500.00 289,000.00 324,000.00 320,000.00 219,000.00 204,000.00 50,000.00 76.000.00 126,000.00 $ 29,195,336.00 $ 35,449,036.00 $ 7,178,397.00 $ 71,822,769.00 See notes to the financial statements. - 49- BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE{OVERSIGHT UNID ANALYSIS OF PRIORYEAR'SSURPLUS FUNDSCOLLECTED FROMINSTITUTIONS AND REDISTRIBUTED TO INSTITUTIONS WITH DEFICITS YEARENDEDJUNE 30, 1997 TOTAL COLLECTED REDISTRIBUTED CURRENT RESIDENT INSTRUCTION REGULAR LOTTERYFOR EDUCATION COLLECTED REDISTRIBUTED COLLECTED REDISTRIBUTED RESEARCH UNIVERSITIES GeorgiaInstituteof Technology $ 103,601.43 $ 101,193.47 $ 101.193.47 $ 2,407.96 $ 0.00 GeorgiaState University 163.081.25 $ 104.780.91 2.496.00 MedicalCollegeof Georgia 135,080.68 97,883.n 3.856.04 Universityof Georgia 317.427.41 216,931.53 28,036.48 REGIONAL UNIVERSITIES Georgia Southem University ValdostaState University 56.518.94 18.620.99 20.176.35 54.094.37 18,620.99 12.67 STATEUNIVERSITIES/COLLEGES Albany State University AnnstrongAUsnlicState University Augusta State University ClaytonCollegeand State University ColumbusState University Fort ValleyState University GeorgiaCollegeand State University GeorgiaSouthwestem State University KennesawState University NorthGeorgiaCollegeand StateUniversity SavannahState University Southem PolytechnicState University State Universityof West Georgia 164.759.83 14,421.88 36.604.09 18,251.66 13,342.43 139.421.80 12.787.34 6.852.33 8.179.68 9.268.41 145,800.89 3,670.55 78.681.89 60.021.34 14,421.88 29,084.01 17,n6.71 863.58 133.440.04 12,095.03 5.316.76 8,088.68 4.494.79 49,468.14 3.090.35 65.299.57 103.744.86 1.039.86 4,745.00 1.332.26 0.20 13.182.00 ASSOCIATE DEGREECOLLEGES Abraham Baldwin Agricu~ural College Atlanta Metropolitan College BainbridgeCollege CoastalGeorgiaCommunityCollege Da~on College Darton College DeKalb College East GeorgiaCollege Floyd College Gainesville College Gordon College Macon College MiddleGeorgiaCollege South GeorgiaCollege Waycross College 578.43 8.782.02 6,517.16 5,128.40 2,033.82 10.363.02 5.731.64 2,398.99 16,568.02 10.401.23 420,508.60 5,755.11 12.092.19 986.58 5.900.44 411.8n.50 28.822.56 1,679.48 8,740.98 5,579.34 128.24 1,636.27 10,162.14 5.731.47 1,792.11 5.420.96 10,293.59 420,508.60 2.691.09 2,059.54 541.09 5.900.44 28,822.56 562.00 4.60 OTHER SkidawayInstituteof Oceanography 5,626.65 CurrentFunds - Unrestrided Surplus- Exhibit"F" $ 1,959,845.34 $ 569.649.80 $ 1,371.057.87 $ 135,916.47 $ 161.419.93 $ 0.00 1,390,195.54 $ 1,959.845.34 $ 1.959.845.34 See notes to the financialstatements. - 50- SCHEDULE "15" FUNDS OTHER ORGANIZED ACTIVITIES REGULAR LOTIERY FOR EDUCATION COLLECTED REDISTRIBUTED COLLECTED REDISTRIBUTED PLANT FUNDS REGULAR LOTIERY FOR EDUCATION COLLECTED REDISTRIBUTED COLLECTED REDISTRIBUTED $ 101,193.47 $ 24,184.49 53,362.15 0.00 $ s 87.47 0.00 $ 55,154.39 8,827.26 18,662.70 $ 0.00 $ 649.95 329.12 347.08 2,411.90 s 20,176.35 993.63 924.54 474.95 7,733.85 5,981.76 692.31 106.71 91.00 3,282.42 96,332.75 580.00 200.32 5,555.68 96.60 1,491.20 16.43 41.04 937.82 5,000.16 397.55 200.88 0.17 416.42 11,142.46 107.64 10,031.90 445.49 411,877.50 1,679.48 190.46 3,064.02 0.75 852.12 4,774.53 $ 179,592.23 $ 0.00 $ 87.47 $ s 0.00 235,962.98 $ s 433,733.33 11,724.86 $ 0.00 - 51 - SECTION II AUDlTEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) AUDITEE'S RESPONSE SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1997 PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS FINDING CONTROL NUMBER AND STATUS 472-96-01 472-96-02 472-96-03 Previously Reported Corrective Action Implemented Previously Reported Corrective Action Implemented Partially Resolved - See Corrective Action/Responses CORRECTIVE ACTIONIRESPONSES GENERAL FIXED ASSETSIPROPERTY MANAGEMENT Inadequacies in Operation of Property Management System Finding Control Number 472-96-03 The Office of Information and Instructional Technology, which is part ofthe Administrative Central Office, hired an accounting assistant effective March 17, 1997 specifically for the purpose of reviewing and revising inventory control procedures and for ensuring that adequate records are maintained for all central office equipment in accordance with the State Property System Manual. This action only partially resolved the fmding for the following reasons: The actual staffhiring and implementation of new procedures came too late to have changes become effective before subsequent audit review; The move by the Central Office from 244 Washington Street to the Trinity-Washington Building in April 1997, required an overhaul of inventory records before we could get started. However, we are confident that the new procedures will resolve this matter. SECTION ill CURRENT YEAR FINDINGS AND QUESTIONED COSTS BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1997 FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXED ASSETSIPRQPERTY MANAGEMENT Inadequacies in Operation of Property Management System Finding Control Number: FS 472-97-01 For the year under review, the Administrative Central Office could not provide complete equipment inventory records by location. As a result of this deficiency, we were unable to test the accuracy and validity of the equipment inventory records. The Administrative Central Office should establish appropriate procedures to strengthen internal accounting controls over the property management system to ensure that all equipment inventory is accurately recorded on the property management records by location and that these records accurately support the balances reported in the general ledger. FEDERAL AWARDS FINDINGS AND OUESTIONED COSTS PROGRAM INCOME ALLOWABLE COSTS/COST PRINCIPLES PROCUREMENT, SUSPENSION AND DEBARMENT ACTIVITIES ALLOWED OR UNALLOWED REPORTING SPECIAL TESTS AND PROVISIONS Inadequate Internal Controls and Compliance Deficiencies Disaster Assistance (CFDA 83.516) Finding Control Number: FA 472-97-01 For the year under review, internal control and compliance testing procedures performed on the Federal Disaster Assistance program revealed deficiencies in the following control categories: 1) Program Income Controls were not in place to ensure that interest income earned on advances was returned to the grantor agency in a timely manner. Federal regulations require interest earned on advances to be returned at least quarterly. Compliance testing revealed that from February 1997 to June 1997, $754,219.86 was earned on advances from the Georgia Emergency Management Agency (GEMA). As of the date of our audit, no funds have been returned to GEMA. - 1- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1997 FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS PROGRAM INCOME ALLOWABLE COSTS/COST PRINCIPLES PROCUREMENT, SUSPENSION AND DEBARMENT ACTIVITIES ALLOWED OR UNALLOWED REPORTING SPECIAL TESTS AND PROVISIONS Inadequate Internal Controls and Compliance Deficiencies Disaster Assistance (CFDA 83.516) Finding Control Number: FA 472-97-01 2) Allowable Costs/ Cost Principles Activities Allowed or Unallowed Controls were not in place to ensure that all personnel responsible for monitoring, administering and accounting for Federal programs were aware of cost principle requirements. Federal regulations mandate that expenditures can only be made for allowable costs as defined in OMB Circular A-87 and the Code ofFederal Regulations 44 CFR Subpart CPost Award Financial Administration Requirements. 3) Suspension and Debarment There were no controls in place to determine ifany contractor paid from Federal funds had been debarred, suspended or otherwise excluded from participation in Federal assistance programs. Compliance testing performed on construction contracts revealed that no suspension or debarment certifications were required from contractors. 4) Reporting There were no controls in place that would allow the tracing of expenditures by program/project to the accounting records. Financial reports submitted by the Central Office to GEMA were not compiled from the central office accounting records. This information was gathered from the project manager's records. Compliance tests, performed on program expenditures and monthly financial reports submitted to GEMA, revealed that there were no reconciliations from the project manager's records to the Central Office's accounting records. Federal regulations require that control procedures must be in place to "permit the tracing of funds to a level of expenditures adequate to establish that such funds have not been used in violation of the restrictions and prohibitions of applicable statutes". -2- BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1997 FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS PROGRAM INCOME ALLOWABLE COSTS/COST PRINCIPLES PROCUREMENT, SUSPENSION AND DEBARMENT ACTIVITIES ALLOWED OR UNALLOWED REPORTING SPECIAL TESTS AND PROVISIONS Inadequate Internal Controls and Compliance Deficiencies Disaster Assistance (CFDA 83.516) Finding Control Number: FA 472-97-01 5) Special Tests and Provisions There were no controls in place that identified the application ofFederal Disaster funds by Damage Survey Reports (DSR). The FEMA Grantee-Subgrantee agreement between GEMA and the Administrative Central Office required DSR's to be completed for each project. It also required that the Administrative Central Office maintain adequately documented accounting records that identified the source and application of Federal and/or State Disaster Assistance funds. In performing compliance tests on expenditures, we noted that expenditures were not identified by DSR, nor were they identified by source of funds (State, Federal or Other). Management should familiarize themselves with Federal regulations dealing with Disaster Assistance funds in order to develop an adequate internal control structure consisting ofprocedures designed to provide for the achievement of compliance objectives. The Administrative Central Office should contact the grantor agency in regard to the return of interest income earned on advances. -3-