Audit report, state of Georgia, Board of Regents of the University System of Georgia, Administrative Central Office, (Oversight Unit), year ended June 30, 1998

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AUDIT REPORT STATEOF GEORGIA BOARDOF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA
,
IADMINISTRATIVE CENTRAL OFFICE(OVERSIGHT UNIT)
!
YEAR ENDEDJUNE 30, 1998
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
- 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

6

D NOTES TO THE FINANCIAL STATEMENTS

7

SUPPLEMENTARY INFORMATION

E C.OMBINING BALANCE SHEET

CURRENT FUNDS - UNRESTRICTED

24

F COMBINING STATEMENT OF CHANGES IN FUND BALANCES

CURRENT FUNDS - UNRESTRICTED

25

G COMBINING STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES,

AND OTHER CHANGES

UNRESTRICTED

26

SCHEDULES

SCHEDULES OF REVENUES AND EXPENDITURES COMPARED TO BUDGET

1

"A" RESIDENT INSTRUCTION

27

2

"B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES

28

3

"D" LOITERYFOREDUCATION

31

SCHEDULES OF APPROVED BUDGET

4

"A" RESIDENT INSTRUCTION

32

5

"B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES

34

6

"D" LOITERY FOR EDUCATION

36

SCHEDULES OF BUDGET TRANSFERS TO OTHER UNITS

7

"A" RESIDENT INSTRUCTION

38

8

"B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES

42

9

"D" LOITERY FOR EDUCATION

45

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
- TABLE OF CONTENTS -

SECTION I

FINANCIAL

SCHEDULES

10 CHANGES IN INVESTMENT IN PLANT

46

11 SCHEDULE OF FUND BALANCES

CURRENT FUNDS AND PLANT FUNDS

48

SCHEDULES OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA

12

"A" RESIDENT INSTRUCTION

50

13

"B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES

52

14

"D" LOTTERY FOR EDUCATION

53

15 ANALYSIS OF PRIOR YEAR'S SURPLUS FUNDS COLLECTED FROM INSTITUTIONS

AND REDISTRIBUTED TO INSTITUTIONS WITH DEFICITS

54

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

SECTIONID CURRENT YEAR FINDINGS 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
February 25, 1999

Honorable Roy E. Barnes, 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 financial statements (Exhibits A through D) ofthe Administrative Central Office (Oversight Unit) of the Board of Regents ofthe University System of Georgia as of and for the year ended June 30, 1998. These financial 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 ofthe 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 financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
Governmental Accounting Standards Board Technical Bulletin 98-1, Disclosures About Year 2000 Issues, requires disclosure of certain matters regarding the year 2000 issue. The Administrative Central Office has included such disclosures in the Notes to the Financial Statements. Because of the unprecedented nature of the year 2000 issue, its effects and the success of related remediation efforts will not be fully determinable until year 2000 and thereafter. Accordingly, insufficient audit evidence exists to support the Administrative Central Office's disclosures with respect to the year 2000 issue made in the Notes to the Financial Statements.
98ARL-62AX

Further, we do not provide assurance that the Administrative Central Officeis or will be year2000 ready, that the Administrative Central Office's year 2000 remediation efforts will be successful in whole or in part, or that parties with which the Administrative Central Office does business will be year 2000 ready.
As described in Note 1 to the fmancial 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 acceptedaccounting principles with respectto the recordingof encumbrances as expenditures and liabilities. Toconfonn with generally acceptedaccounting principles, encumbrances should be recorded as a reservation of fund balance. The effects on the financial statements of this departure from generally accepted accountingprinciples were not reasonably determinable, but are believedto be material.
As disclosed in Note 1 to the financial statements, the Administrative Central Office did not report the liability and related expenditure for compensated absences in the current funds as required by generally acceptedaccounting principles. If compensated absences were reported, liabilities would be increased and fund balancewould be decreased by $1,044,236.11 as ofJune 30, 1998,and the net change in fund balance for the year ended June 30, 1998,would be decreased by $136,658.78.
In our opinion, except for the effects of such adjustments, if any, as might have been determined to be necessary had we been able to examine sufficientevidence regarding year 2000 disclosures, and except for the effectson the financial statements ofthe matters discussed in the :fifth and sixth paragraphs, the fmancial statements referred to abovepresentfairly, in all material respects, the financial positionof the Administrative Central Officeas ofJune 30, 1998, andthe changes in fundbalances andthe currentoperating fundsrevenues, expenditures, and other changes for the year then ended in conformity with generallyaccepted accounting principles.
Our audit was made for the purpose offorming an opinion on the financial statements taken as a whole. The accompanying supplementary information(Exhibits E through G and Schedules 1 through 15) is presented for purposesofadditional analysis and is not a required part ofthe financial statements ofthe Administrative Central Office. Such informationhas been subjectedto the auditingproceduresapplied in the audit of the financial statements and, in our opinion, exceptfor the effects of suchadjustments, ifany,as might have been determined to be necessary had we beenable to examine sufficient evidence.regarding year2000 disclosures, and except for the effectsof the mattersdiscussed in the fifth and sixthparagraphs, such information is fairly presented in all material respects in relation to the financial statements taken as a whole.
Respectfully submitted,

CLV:gp 98ARL-62AX

aude L. Vickers State Auditor

FINANCIAL STATEMENTS - 1-

BOARDOF REGENTS OF !HE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID COMBINED BALANCE SHEET ALL FUNDGROUPS JUNE 30, 1998

ASSETS
Cash and Cash Equivalents Investments Accounts Receivable Prepaid Items Investment in Plant

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

ENDOWMENT AND SIMILAR
FUNDS

$

17,338,375,23 $

28,974,479,69

47,986,400.54

2,343,11

4,265,061.07 $

5,931,517.71

Total Assets

$

94,301,598.57 $

4,265,061.07 $ ======5=,=9=3=1=,5=1=7=.7=1==

LIABILITIES AND FUNDBALANCES
Liabilities Accounts Payable Allotments Due to Other Units Employee Health Benefits Claims DepositsHeld in Custodyfor Others Capital Lease Obligations
Total Liabilities
Fund Balances Endowment Quasi-Endowment - Restricted Net Investmentin Plant Restricted Unrestricted
Total Fund Balances

$

10,234,708,78

44,613,457.00

21,800,000.00

$

76,648,165.78

$

$

17,653,432.79

$

17,653,432.79 $

$ 4,265,061.07 4,265,061.07 $

3,612,043.20 2,319,474.51
5,931,517,71

Total Liabilities and FundBalances

$

94,301,598,57 $

4,265,061,07 $ ======5=,=9=3=1=,5=1=7=.7=1==

The notesto the financialstatements are an integral part of this statement. -2-

EXHIBIT "A"

PLANT FUNDS

INVESTMENT

UNEXPENDED

IN PLANT

AGENCY FUNDS

TOTAL (Memorandum
Only)

$

10,633,916.84

4,647,621.33

------$

$ 177,325,759.22 .

80,972,489.78 $

119,141,360.63 28,974,479.69 52,634,021.87
2,343.11 177,325,759.22

$

15,281,538.17 $ 177,325,759.22 $

80,972,489.78 $ 378,077,964.52

$

4,334,959.25

I

$

$

4,334,959.25 $

$ 899,707.95
899,707.95 $

$ 80,972,489.78 80,972,489.78 $

14,569,668.03 44,613,457.00 21,800,000.00 80,972,489.78
899,707.95
162,855,322.76

$ 176,426,051.27

$

10,946,578.92

$

10,946,578.92 $ 176,426,051.27

$

3,612,043.20

2,319,474.51

176,426,051.27

4,265,061.07

28,600,011.71

$ 215,222,641.76

$

15,281,538.17 $ 177,325,759.22 $

80,972,489.78 $ 378,077,964.52

-3-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA . ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID COMBINED STATEMENT OF CHANGES IN FUNDBALANCES ALL FUNDGROUPS YEARENDED JUNE30 1998

REVENUES AND OTHER ADDITIONS
Unrestricted CurrentFund Revenues Federal Grantsand Contracts StateGrantsand Contracts PrivateGifts,Grants, and Contracts Investment Income
Endowment Other Net Increasein Fair Value of Investments Adjustments PriorYears' Expenditures/Accounts Payable Remittance of Uncommitted Regents Scholarships from Unitsof the University System of Georgia Remittance of Uncommitted Regents Opportunity Grants from Unitsof the University System of Georgia Remittance of Surplusfrom Unitsof the University System of Georgia
Year EndedJune 30,1997 Expended for PlantFacilities
CurrentFunds Plant Funds
Unexpended OtherAdditions
Insurance Recoveries
Total Revenues and OtherAdditions
EXPENDITURES AND OTHER DEDUCTIONS
Educational and General Expenditures Adjustments
PriorYears' RevenueslAccounts Receivable Administrative Fees Allotments to Units of the University Systemof Georgia
MercerUniversity Grant- Equipment EqUipment, Technology, and Construction Trust Fund Refunded to Grantors Unrestricted FundBalance(Surplus) Returned to the Officeof Treasury and FiscalServices
Year EndedJune 30, 1997 Expended for Plant Facilities
Capitalized Noncapitalized DisposalslDeletionslAdjustments
Total Expenditures and Other Deductions
TRANSFERS BETWEEN FUNDS
Mandatory InvestmentIncomefor Endowment Principal StateAppropriations for Restricted Quasi-Endowment Fund
Nonmandatory Endowment Principal for Objectof Trust
Total TransfersBetween Funds
Net IncreaseJ(Decrease) for the Year
FUNDBALANCES JULY 1,1997 (Restated-See Note 1)
FUNDBALANCES JUNE30 1998
The notesto the financialstatements are an integral partof this statement.
-4-

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

$ 214,395,613.31 $
347,373.56 8,686.66 5,246.00
7,190,445.74

119,025.00 106,400.00 76,000.00
258,117.25 62,611.92

$ 221,947,365.27 $
$ 218,476,950.44 $ 7,449.80
250,000.00

622,154.17 509,652.53 33,148.78

7,259,441.90

$ 225,993,842.14 $

542,801.31

$

$

-1,500,000.00

$

-1,500,000.00 $

$

-5,546,476.87 $

23,199.909.66

-59,129.52
1,080,489.30 1,021.359.78 1,100,712.64 3.164,348.43

$

17,653,432.79 $

4,265,061.07

EXHIBIT"B"

ENDOWMENT AND SIMILAR
FUNDS

PLANT FUNDS

INVESTMENT

UNEXPENDED

IN PLANT

TOTAL (Memorandum
Only)

$

$

1,081,949.19

$

1,081,949.19 $

9,975,997.18
1,047,106.90 61,595.31 310,634.45

$ 214,395,613.31 119,025.00
10,082,397.18 76,000.00
258,117.25 1,109,718.82 1,143,544.50
658,008.01
8,686.66
5,246.00

$
4,393,380.00 15,788,713.84 $

7,107,716.15 32,841,198.53
39,948,914.68 $

7,190,445.74 7,107,716.15 32,841,198.53 4,393,380.00 279,389,097.15

$

0.00

$

58,359.72

401.00 2,056,895.90

$ 218,986,602.97
7,449.80 91,508.50
250,000.00 401.00
2,056,895.90

378.04

7,259,819.94

32,841,198.53 1,100,241.33 $

2,066,444.52

32,841,198.53 1,100,241.33 2,066,444.52

$

0.00 $

36,057,474.52 $

2,066,444.52 $ 264,660,562.49

$

59,129.52

1,500,000.00

-1,080,489.30

$

478,640.22

$

1,560,589.41 $

4,370,928.30

-20,268,760.68 $ 31,215,339.60

$
$ 37,882,470.16 $ 138,543,581.11

0.00 0.00 0.00 0.00 14,728,534.66 200,494,107.10

$

5,931,517.71 $

10,946,578.92 $ 176,426,051.27 $ 215,222,641.76

-5-

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, 1998

EXHIBIT"C"

Net IncreaseJ(Decrease) in FundBalances

$ -5,546,476.87 $ 1,100,712.64 $ -4,445,764.23

The notes to the financialstatements are an integral part of this statement. -6-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS ruNE 30. 1998

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, 1998, 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 ofRegents, 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 fmancial 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 of the 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 ofthe University System of Georgia.
The accompanying financial statements represent only the financial 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 ofthe 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 ofthe 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 financial statements, funds that have similar characteristics have been combined into fund groups. Accordingly, all financial transactions have been recorded and reported by fund group.
-7-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNI1) NOTES TO THE FINANCIAL STATEMENTS JUNE30. 1998

EXlllBIT "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 financial statements are as follows:
CURRENT FUNDS
UNRESTRICTED - The fund used to account for those economic resources over which the Administrative Central Office 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 amountsrepresenting 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.

-8-

BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNI'D
NOTES TO THE FINANCIAL STATEMENTS
JUNE30.1998

EXIllBIT "D"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING Except as otherwise disclosed in these notes, the financial statements are preparedon the modified accrual basisofaccounting, which is materially the sameas the accrual basisofaccounting applicable to colleges and universities prescribed in the American Institute ofCertified PublicAccountants' auditguidereporting model. The modified accrual basisofaccounting is defined as that method of accounting in whichexpenditures, other than accrued intereston general long-term debt, are recorded at the time liabilitiesare incurred and revenues are recorded when availableand measurable to fmance expenditures of the fiscal period.

Contractual obligations for goodsand services whichhavenot been receivedat the end ofthe fiscal year are recognized as expenditures and liabilities in the accompanying financial statements. This accounting practice causesexpenditure-driven grantrevenues to be accrued based, in part, on the unexecuted portionofcontracts for goods and services. The recognition of encumbrances as expenditures and liabilities is in conformity with accounting practices prescribedor permitted by statutes and regulations of the State of Georgia, but is not consistent with generally acceptedaccounting principles, which providefor the recording of encumbrances as a reservation offund 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 of theAdministrative Central Office relating to employees' rights to receive compensationfor future absences based upon services already rendered. This obligationrelates onlyto vestingaccumulated annual leavein whichpayment is probable and can be reasonably estimated. The compensated absences liability of$1,044,236.11 andthe related current yearexpenditure of$136,658.78 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 ofcurrentfunds in the accompanying financial statements. This presentation is in accordance with accounting practices prescribedor permittedby 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 presentationof the financial 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 shownon the Combined BalanceSheet as Net Investment

in Plantreflectthe accumulated expenditures madefor plantfacilities through Current Fundsand PlantFunds

and also include expenditures made for plant facilities expended by the Georgia State Financing and

Investment Commission on behalf of the Administrative CentralOffice. Donatedfixed assets are recorded

at fair marketvalue on the date donated. Disposals are deleted at recorded values. No depreciation has been

provided on physical plant and equipment.

.

-9-

BOARD OF REGENTSOF THE UNIVERSITY SYSTEMOF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE(OVERSIGHT UNID
.NOTES TO THE FINANCIAL STATEMENTS
JUNE30, 1998

EXHlBIT"D"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING The Statement of Current Funds Revenues, Expenditures, and Other Changes is a statement of fmancial . 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 ofrevenues and expenses.

RESTATEMENT OF PRIOR YEAR FUND BALANCE In fiscal year 1998, the Board ofRegents ofthe University System of Georgia implemented GASB Statement 31, "Accounting and Financial Reporting for Certain Investments and for External Investment Pools". The statement requires certain investments to be reported at fair value rather than at cost. The following analysis reflects. the results of this change in accounting principle:

Beginning FundBalance Increase/(-)Decrease Beginning FundBalance- Restated

Current FundsUnrestricted
$23,166,265.12

Current FundsRestricted
s 1,484,721.79

Endowment and Unexpended Similar Funds Plant Funds
s 4,370,833.93 $31,250,727.54

33.644.54 1,679,626.64

94.37

-35,387.94

s s $23,199,909.66 3.164,348.43 4,370,928.30 $31.215.339.60

BUDGET

The Board of Regents of the University System of Georgia - Administrative Central Office receives State

appropriation allotments for units ofthe University System of Georgia. The appropriated budget is adopted

at the departmental level and represents appropriations provided by the Amended Appropriations Act of 1997-

1998. The appropriated budget covers current funds and plant funds, except for Auxiliary Enterprises and

Student Activities which are not subject to appropriation, The allocation of the appropriated budget 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 - Education, General and Departmental Services
"B" Regents Central Office and Other Organized Activities Operating Expenses - Sponsored Operations

$ 822.286.94 $ 237.652,53

These overexpenditures of budget constitute a violation of Board of Regents policy, but do not constitute statutory violations of budget authority. Statutory violations of budget authority are reported at the departmental level.

- 10-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEMOF GEORGIA ADMINISTRATIVE CENTRALOFFICE (OVERSIGHT UNID NOTES TO THE FINANCIAL STATEMENTS JUNE 30.1998

EXHIBIT"D"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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.
INVESTMENTS Investments are reported at fair value. 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 ofRegents authorizing resolutions. Gains and losses on investment transactions are accounted for inthe funds where such assets are recorded.
Investments in the various investment pools maintained by the Administrative Central Office consist, in part, ofrepurchase 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 ofInvestments) 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, 1998, the Administrative Central Office had $4,466,197.00 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 fmancial 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
- 11 -

BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1998

EXlllBIT "D"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES pledge as collateral anyone or more ofthe following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59:
(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 ofthe 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 ofindebtedness, 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 ofthe 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, 1998, are categorized below in order to provide information about the extent to which such deposits are exposed to custodial credit risk:

- 12-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
NOTES TO THE FINANCIAL STATEMENTS JUNE30, 1998

EXlllBIT "D"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND IN-vESTMENTS

CATEGORIZATION OF DEPOSITS Category 1 - Amounts covered by depository insurance or collateralized with securities (at fair 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 fair value) held by the pledging fmancial institution's trust department or agent in the Administrative Central Office's name.

Category 3 - Amounts collateralized with securities (at fair 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.

Cash Deposits InvestmentPortfolio Accounts
Total Cash Deposits

Canying Amount

Bank Balances

s s s 19,534,106.00 11,527,688.39

-253,237.07

0.00

s s s ]928086893 11,527,68839

Risk Categories

2

3

s 120,226.08
0.00

s 0.00 11,407,462.31

0.00

0.00

s ]2022608

s ] 000 1,4074623]

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, 1998, are categorized below:

Type of Investment

Common Stock

$

Corporate Bonds

Repurchase Agreements

U. S. Government Securities

Total Investments

s

Risk Categories

1

2

0.00 $ 41,125,590.15 $ 7,966,276.50
. 13,098,000.00 66,645,104.74

0.00 $128.834.971.39 $

Carrying

3

Amount

s 0.00 41,125,590.15
7,966,276,50
13,098,000.00 66,645,104.74

0.00 $128.834.971.39

- 13-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1998

EXIllBIT "D"

NOTE 3: EXTERNAL INVESTMENT POOL
The Administrative Central Office serves as fiscal agentfor various unitsof the University System of Georgia and cooperative organizations. The Administrative Central Officepools the monies ofthese organizations with the Administrative Central Office's monies for investment purposes. The Administrative Central Office cannot allocate pool investments between the internal (University System) and external (cooperative organizations) investment poolportions. Theinvestment pool is not registered withthe SECas an investment company. The fairvalueof investments is determined daily. Thepool doesnot issueshares. Eachparticipant is allocated a pro rata shareof each investment at fair value along with a pro rata share ofthe interest that it earns. Condensed financial information for the investment pool follows:
Statement ofNet Assets - June 30. 1998

Cash Investments Interest Receivable

s -1,523,173.55 100,703,313.84 427.114.34
s 99,607,254.63

Net Assets Held in Trust for Pool Participants
Internal Portion External Portion

s 21,661,655.21 77.945.599.42.
s 99,607,254.63

Statement ofChanges in Net Assets - Year Ended June 30. 1998

Revenues
Interest Income Net Increase in Fair Value ofInvestments
Total Revenues

s 4,022,843.76 10.531.063.23
s 14,553,906.99

Expenses

Operating Expenses Administrative Expenses
Net Increase in Assets Resulting from Operations

369.269.81
s 14,184,637.18'

Distribution to Participants Capital Transactions
Total Decrease in Net Assets

-59,250,391.35 26.951,815.36
s -18,113,938.81

Net Assets July 1, 1997 Net Assets June 30, 1998

117.721,193.44
s 99.607,254.63

- 14-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRALOFFICE (OVERSIGHT UNID NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1998

EXHIBIT liD"

NOTE 4: INVESTMENT IN PLANT

The following is a summary of Investment in Plant fixed assets as of June 30, 1998:

Land Equipment Library Books and Collections Construction in Progress

$ 2,501,877.00 19,112,782.05 31,384.30
155,679,715.87

Total Investment in Plant

$177.325,759.22

NOTE 5: OPERATING LEASES

The Administrative Central Office has entered into certain computer software license agreements and agreements to lease real property 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 ofthe 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, 1998, 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

1999

$ 3.861.800.00

Expenditures for computer software license agreements and agreements to lease real property under operating leases for the year ended June 30, 1998, totaled $706,597.30.

NOTE 6: 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 ofany sums under such agreements beyond the fiscal year of execution ifappropriated 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, 1998, future minimum lease payments under capital leases are as follows:

- 15 -

BOARD OF REGENTS OF 1HE UNIVERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
NOTES TO 1HE FINANCIAL STATEMENTS
JUNE 30, 1998

EXHIBIT"D"

NOTE6: CAPITALLEASES

Fiscal Year Ending June 30
1999 2000 2001
Total Future Minimum Lease Payments
Less: Amounts Representing Interest
Present Value of Future Minimum Lease Payments
NOTE 7: RISK MANAGEMENT

$ 393,620.02 342,418.68 256,046.81
$ 992,085.51
92.377.56
$ 899.707.95

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$1,000,000.00 per person and dental coverage up to an annual maximum of$l,OOO.OO per person.

The Board ofRegents has contracted with Blue Cross - Blue Shield to process all claims in accordance with medical coverage guidelines as establishedby 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 ofthe University System of Georgia.

A reconciliation oftotal estimated claims liabilities for the fiscal year ended June 30, 1998, is shown below:

Unpaid Claims and Claim Adjustments July 1, 1997
Incurred Claims and Claim Adjustments Expenses - Provisions for Insured Events ofthe Current Year
Payments - Claims and Claim Adjustments Attributable to Insured Events . ofthe Current Year and of Prior Years
Unpaid Claims and Claim Adjustments June 30, 1998

$ 20,900,000.00 140,916,616.21 -140,016,616.21
$ 21.800.000.00

- 16-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEMOF GEORGIA ADMINISTRATIVE CENTRALOFFICE (OVERSIGHTUNITI NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1998

EXHlBIT"D"

NOTE 7: RISK MANAGEMENT
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 ofRegents ofthe 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.
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 8: 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, 1998.
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 was converted effective July 1, 1998.

- 17-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
NOTES TO THE FINANCIAL STATEMENTS
JUNE30. 1998

EXlllBIT "D"

NOTE 9: 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 defined benefit pension plan 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 in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the GeorgiaDepartment of Audits and Accounts.

Funding Policy Employees of the Administrative Central Office who are covered by TRS are required by State statute to contribute 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 in accordance with State statute and as advised by their independent actuary. For fiscal year 1998, the employer contribution rate was 11.81% for covered employees. In addition, the Administrative Central Office contributed 3.91% to the TRS on behalf of employees electing to participate in the Regents Retirement Plan. Employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1998 1997 1996

100% 100% 100%

$ 923,018.72 $ 800,125.86 $ 675,105.36

REGENTS RETIREMENT PLAN

Plan Description The Regents Retirement Plan, a single-employer defined contribution plan, is an optional retirement plan established and administered by the Board of Regents of the University System of Georgia, under which it may purchase annuity contracts for the purpose ofproviding retirement and death benefits for eligible faculty and principal administrators. Benefits depend solely on amounts contributed to the plan plus investment earnings. Benefits are payable to participating employees or their beneficiaries in accordance Withthe "terms ofthe annuity contracts.

Funding Policy Member contribution requirements are established by the Board of Trustees of the Teachers Retirement System. Employer contributions are established by statute and may be amended only by the General Assembly ofthe State of Georgia. The employer contributes 7.75% ofthe participating employee's earnable

- 18 -

BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNTD
NOTES TO THE FINANCIAL STATEMENTS
JUNE30.1998

EXHIBIT"D"

NOTE 9: RETIREMENT PLANS
REGENTS RETIREMENT PLAN
Funding Policy compensation. Employees contribute 5% oftheir earnable compensation. Amounts attributable to all plan contributions are fully vested and non-forfeitable at all times.
The Administrative Central Office and the covered employees made the required contributions of$117,724.29 (7.75%) and $75,950.84 (5%), respectively.
NOTE 10: 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, except as noted in the subsequent paragraph.
Effective July 1, 1998, certain employees who retire with a minimum of three months of unused sick leave are entitled to additional service credit in the Teachers Retirement System of Georgia.
NOTE 11: CONTINGENCIES
Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. This could result in refunds to the grantor agency for any 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 ofRegents expects such amounts, ifany, to be immaterial to its overall financial position.
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 ofGeorgia. 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, 1998.
NOTE 12: 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 ofthe Board ofRegents
- 19-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNlT) NOTES TO THE FINANCIAL STATEMENTS
JUNE30.1998

EXlllBIT "D"

NOTE 12: POSTEMPLOYMENT BENEFITS OTHER THAN PENSION BENEFITS
to permit employeesofthe UniversitySystemofGeorgiaeligiblefor retirement or that become permanently and totally disabled to continueas membersofthe grouphealth and life insuranceprograms. Employeeswho are eligible for retirement or disability under the criteria established by the Teachers Retirement System of Georgiaand who have at least ten years ofservicewith the UniversitySystemofGeorgiaare 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, 1998, there were 47 employees who had retired or were disabled that were receiving these postemployment health and life insurance benefits. For the year ended June 30, 1998, the Administrative Central Office recognizedas incurred$80,268.55 ofexpenditures, which was net of$38,454.51 ofparticipant contributions.
NOTE 13: STATE MEDICAL EDUCATION BOARD
The State Medical Education Board,which is administratively attachedto the Administrative Central Office ofthe Board of Regents ofthe UniversitySystemofGeorgia, providesservicecancellableloans/scholarships to eligible students who are residents of the State of Georgia and pursuing a degree in medicine. After becoming licensed physicians, recipients earn servicecreditsby practicingtheir professionin a State Medical Education Board approved community. Recipients in violation of the loan/scholarship agreement are immediatelyliable for all funds advancedplus interest at the minimum rate of 12% per annum. At June 30, 1998,the balance ofloans/scholarships outstanding was $3,384,781.75. This balance is not reflected in these fmancial statements.
The State Medical Education Board also administersthe "Physiciansfor 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 immediatelyliable for twice the uncredited loan amount. At June 30, 1998, the balance ofloans outstanding was $323,588.38. This balance is not reflected in these financial statements.
NOTE 14: SIGNIFICANTTRANSACTIONS
ATLANTA COMMITTEE FORTHE 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 constructionof six dormitories on the campus of Georgia Institute of Technology. Cost of the six dormitory projects, estimatedat $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 Financingand Investment Commission (GSFIC). Construction contracting and constructionmanagementwas coordinated by GSFIC. Contract documents required ACOG to transfer their portion ofthe constructioncost representing $47,000,000.00 to the Board ofRegents. GSFIC requested
- 20-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRALOFFICE (OVERSIGHT UNID
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1998

EXHIBIT"D"

NOTE 14: SIGNIFICANT TRANSACTIONS
ATLANTA COMMITTEEFOR TIlE OLYMPIC GAMES (ACOG) CONSTRUCTION FUND transferofthese funds from the Board ofRegents as needed for paymentof constructioncosts. At June 30, 1998,the Board of Regents had $1,964,919.76 on deposit in AgencyFunds associated with this project.
GEORGIACENTERFORADVANCEDTELECO~CATIONSTECHNOLOGY(GCATn
The Board of Regents of the University System of Georgiais administratively responsible for the GCAIT construction project located on the GeorgiaInstituteof Technology campus. The Unexpended Plant Fund expenditures (net) to date totaling $32,272,024.51, 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 relatedto this projectas Construction in Progress. Upon completion,the Administrative Central Office will transferthe 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 ofRegents of the UniversitySystemof Georgia- Administrative Central Office is recording the cost ofrepairs and reconstruction due to extensive flood damageto 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 continueto record all capital expenditures related to this project as Construction in Progress. Upon project completion, the Administrative Central Office will transfer the appropriate balanceofthe Construction in Progress account to Albany State Universityto be recorded in the University's Investment in Plant account. The expenditures to date on this project are $128,213,980.25 and include $34,141,439.86 of current year expenditures, of which $33,041,198.53 were capitalized as Construction in Progress. These expenditures are funded by insurance recoveries, Federal and State grants, and State lottery appropriations.
NOTE 15: YEAR 2000 SYSTEMS READINESS
The year 2000 issue is the result of shortcomings in many electronic data processing systems and other electronic equipment that may adversely affect the Administrative Central Office's operations as early as calendaryear 1999. The Administrative Central Office has identified computer systems and other electronic equipmentthat may be affected by the year2000issueandarenecessary to conducting Administrative Central Officeoperations. The following stages havebeen identified as necessary to implement year 2000 compliant systems.
Awareness Stage- Encompasses establishing a budgetand project plan for dealing with the year2000 issue.
Assessment Stage- The actual process of identifying all systems and individual components ofsystems to check for compliance.
- 21 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
NOTES TO THE FINANCIAL STATEMENTS JUNE30.1998

EXHIBIT"D"

NOTE 15: YEAR 2000 SYSTEMS READINESS
Remediation Stage - The time when changesare made to systems and equipment.
ValidationfI'esting Stage - The process of ensuringthat the changes made to systems and equipment will produce a year 2000 compliant system.
It will be necessary for the Administrative Central Office to progress throughall four ofthese stages for each computerand/orelectronic system, not already year2000 compliant, in orderto assurethat these systems will not be adversely affected.
The Administrative Central Office has completed an inventory of computer systems and other electronic equipment that may be affected by the year 2000 issue and that are necessaryto conducting our operations. The following financial systems will be (or have been) remediated by the Board of Regents, University System of Georgia.
The Collegeand University Fund Accounting Systemis being remediated. Final testing is scheduled for April 1999.
The Regents Budget Reporting System is year 2000 compliant. The awareness, assessment, validation/testingphases were completedin 1997.
The RegentsPayroll/Personnel Systemis being remediated with validation, and testing scheduled for completion in July 1999.
The Regents Property Inventory System is year 2000 compliant. The awareness, assessment, validation/testingphases were completedin 1997.
The WachoviaConnection PC-ACHsystem is year2000compliant. This systemis used for delivering state appropriationsto institutionsof the University System.
A new RMFSAP2 system, compliant with year2000,has beendeveloped to completely replacethe old systemfor forecasting state appropriations and preparing/consolidating the monthly financial reports. The final testing has been completed. The systemwill be in use beginningMarch 1, 1999.
Becauseofthe unprecedented natureof the year2000 issue,its effects and the success ofrelated remediation effortswill not be fully determinable until year2000 andthereafter. Whilemanagement is confident that the Administrative Central Office will be year 2000 ready, it cannot assumethat its remediation efforts will be successful in whole or in part, or that partieswith whomthe Administrative Central Officedoes businesswill be year 2000 ready.

- 22-

SUPPLEMENTARY INFORMATION - 23-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNm COMBINING BALANCE SHEET CURRENT FUNDS - UNRESTRICTED JUNE 30, 1998

EXHIBIT "E"

"A" RESIDENT INSTRUCTION

"B" REGENTS CENTRAL
OFFICE AND OTHER ORGANIZED
ACTIVITIES

"0" LOTTERY FOR
EDUCATION

EMPLOYEE HEALTH BENEFITS PLAN.

TOTAL

Cashand CashEquivalents Investments Accounts Receivable Prepaid Items
TotalAssets

$ 3,021,166.49 $
42,787,998.54 439.50

618,136.56 $
2,780,000.00 1,903,61

4,109,653.92 $ 9,589,418.26 $ 17,338,375.23

28,974,479.69

28,974,479.69

2,418,402.00

47,986,400.54

2,343.11

$ 45,809,604.53 $

3,400,040.17 $ 6,528,055.92 $ 38,563,897.95 $ 94,301,598.57

LIABILITIES AND FUND BALANCES
Liabilities Accounts Payable
Allotments Dueto OtherUnits
Employee Health Benefits Claims
Total Liabilities
FundBalances Unrestricted

$ 3,145,364.28 $ 41,833,457.00
$ 44,978,821.28 $
830,783.25

Total Liabilities and Fund Balances

$ 45,809,604.53 $

562,781.16 $ 2,780,000.00

6,526,563.34

$ 10,234,708.78

44,613,457.00

$ 21,800,000.00

21,800,000.00

3,342,781.16 $ 6,526,563.34 $ 21,800,000.00 $ 76,648,165,78

57,259.01

1,492,58

16,763,897.95

17,653,432.79

3,400io,l0iio4i.0...1.7.. $ 6,528,055.92 $ 38,563,897.95 $ 94,301,598.57

see notesto the financial statements.

-24-

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, 1998

EXHIBIT"P

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, 1997
Total Revenues and Other Additions
EXPENDITURES AND OTHER DEDUCTIONS
Educational and General Expenditures Adjustments
Prior Years' Revenues/Accounts Receivable Allotments of Mercer University Grant - Equipment Unrestricted Fund Balance (SurplUS)
Retumed to the Office of Treasury and Fiscal Services Year Ended June 30, 1997
Total Expenditures and Other Deductions
TRANSFERS BETWEEN FUNDS
Mandatory State Appropriations for Restricted Quasi-Endowment Fund
Net Increasel(Decrease) for the Year
FUND BALANCES JULY 1, 1997

"A"
RESIDENT INSTRUCTION

"B"
REGENTS CENTRAL OFFICE AND
OTHER ORGANIZED ACTMTIES

"0" LOTIERY FOR
EDUCATION

EMPLOYEE HEALTH BENEFITS PLAN

TOTAL

$ 32,155,954.96 $ 19,115.76
1,434,635.83 $ 33,609,706.55 $

28,614,875.07 $ 12,758,586.00 $ 140,866,197.28 $ 214,395,613.31

23,921.57

747.00

303,589.23

347,373.56

8,686.66

8,686,66

5,246.00

5,246.00

244,563.20

5,511,246.71

7,190,445.74

28,897,292.50 $ 18,270,579.71 $ 141,169,786.51 $ 221,947,365.27

$ 29,836,837.67 $ 7,449.80

28,581,537.63 $ 12,757,840.42 $ 147,300,734.72 $ 218,476,950.44

250,000.00

7,449.80 250,000.00

1,439,327,71 $ 31,283,615.18 $

306,735.66

5,513,378.53

7,259,441.90

28,888,273.29 $ 18,521,218.95 $ 147,300,734.72 $ 225,993,842.14

$ -1,500,000.00 $ 826,091.37 $
4,691.88

9,019.21 $ 48,239.80

$ -1,500,000.00

-250,639.24 $ -6,130,948.21 $ -5,546,476.87

252,131.82

22,894,846.16

23,199,909.66

FUND BALANCES JUNE 30, 1998

$ 830,783.25 $

57,259.01 $

1,492.58 $ 16,763,897.95 $ 17,653,432.79

See notes to the financial statements.

-25-

BOARDOF REGENTS OFTHE UNIVERSITY SYSTEMOF GEORGIA ADMINISTRATIVE CENTRAL OFFICE(OVERSIGHT UNm
COMBINING STATEMENT OF CURRENT FUNDSREVENUES, EXPENDITURES, AND OTHERCHANGES UNRESTRICTED
YEARENDEDJUNE30, 1998

EXHIBIT"G"

REVENUES
State Appropriations Other Sources
Total Revenues
EXPENDITURES AND MANDATORY TRANSFER
Educatlonal and General Instruction Public Service InsrnutionalSupport Operationend Maintenance of Plant Scholarships and Fellowships MandatoryTransferfor: StateAppropriations for Restricted Quasi-Endowment Fund
Total Expenditures end Mandatory Transfer
OTHERTRANSFERS AND ADDITIONS/{DEDUCTIONS)
Allotmentsof MercerUniversityGrant- Equipment Prior PeriodAdjustments (Net) Remltlenceof Uncommitted RegentsScholarships
from Units of the UniversitySystemof Georgia Remltlenceof Uncommitted Regents
OpportunityGrantsfrom Units of the UniversitySystemof Georgia Remittance of Surplusfrom Units of the UniversitySystemof Georgia
Year EndedJune 30, 1997 Unrestricted FundBalence(Surplus)
Returnedto Office of Treasuryend Fiscal Services Year EndedJune 30, 1997
Total OtherTransfersand Addltionsl(Deducllons)

"A" RESIDENT INSTRUCTION

"8" REGENTS CENTRAL
OFFICEAND OTHERORGANIZED
ACTIVITIES

"0" LOTTERY FOR EDUCATION

EMPLOYEE HEALTH BENEFITS PLAN

TOTAL

$ 21,726,659,00 $ 10,429,295,96
$ 32,155,954,96 $

27,785,314.00 $ 12,758,586.00

$ 62,270,559.00

829,561,07

$ 140,866,197.28

152,125,054.31

28,614,875.07 $ 12,758,586.00 $ 140,866,197,28 $ 214,3!l5,613,31

$

23,257.34

396,124.28 $

29,417,456.05

1,500,000.00 $ 31,336,837,67 $

18,787,576,00 7,491,425.37 $
425,855,96 1,876,680,30

12,757,840.42 $

$ 147,300,734,72

23,257,34 19,183,700.28 196,967,456.56
425,855.96 1,876,680.30

1,500,000.00 28,581,537,63 $ 12,757,840,42 $ 147,300,734.72 $ 21!l,976,950.44

$

11,665.96 $

1,434,635.83

$ 23,921,57
8,686,66

-250,000.00 747,00 $

$ 303,589,23

-250,000.00 339,923.76
8,686.66

5,246,00

5,246.00

244,563,20

5,511,246,71

7,190,445.74

-1,439,327.71

$

6,974,08 $

-306,735,66

-5,513,378,53

-7,259,441,90

-24,318.23 $ -251,384,82 $

303,589,23 $

34,860.26

Net IncreaseJ(Decrease) In Fund Balences

$ 826,091.37 $

9,019.21 $ -250,639.24 $ -6,130,948.21 $ -5,546,476.87

See notes to the financialstatements,

-26-

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRAINE CENTRAL OFFICE (OVERSIGHT UNm
SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET "A" RESIDENT INSTRUCTION YEARENDED JUNE30,1998

SCHEDULE "1"

REVENUES
StateAppropriations OtherRevenues Retained

EXPENDITURES
Personal Services: Education, General and Departmental Services $
Operating Expenses: Education, General and Departmental Services
capital Outlay SpecialFunding Initiative Research Consortium Year 2000 Project

5,131,494,91
20,274,911,94 0,00
3,680,430,82 750,000,00 $ 0,00

$ 5,131,494,91 $ 5,260,203,00 $

1,500,000.00

20,274,911.94 0.00
3,680,430,82 2,250,000,00
0.00

19,452,625.00 559,000,00
5,007,124,00 2,260,000.00
788,868.00

128,708.09
-822,286.94 559,000,00 1,326,693,18
10,000,00 788,868.00

$

29,836,837,67 $ 1,500,000.00 $ 31,336,837,67 $ 33,327,820,00 $ _ _1..,9:9.0:.,9;8;2,;.3=3=~

Excessof Revenues over Expenditures

$

2,319,117,29 $ -1,500,000.00 $ 819,117.29

819,117,29

(1) To reclassify balanceof currentyeartransfers of restricted appropriations to GeorgiaEminentScholars Endowment Trust Fund.

see notes to the financial statements.

-27 -

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UN/D
SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE30,1998

REVENUES State Appropriations Other Revenues Retained
EXPENDITURES Personal Services:
Education, General andDepartmental 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 MilitaryCollege Direct Payments to the Georgia Public
Telecommunications Commission for Operations
Excessof Revenues over Expenditures

CURRENTFUNDS UNRESTRICTED RESTRICTED

$ 27,785,314,00 829,561,07 $

509,652,53

$ 28,614,875,07 $ 509,652,53

$ 5,674,648,21

1,898,979,63 $
98,650,00 1,420,333.79
600,000.00 200,000.00 1,273,869.00

509,652,53

17,415,057.00

$ 28,581,537.63 $ 509,652.53

$

33,337.44 $

=0=.=0-0_

See notesto the financialstatements.

-28-

SCHEDULE "2"

PLANT FUNDS UNEXPENDED

TOTAL (Budget Basis)

BUDGET

VARIANCEFAVORABLE (UNFAVORABLE)

$ 27,785,314.00 $ 27,785,314.00 $

0.00

$ 15,478,079.39 16,817,292.99

57,237,882.00

-40,420,589.01

$ 15,478,079.39 $ 44,602,606.99 $ 85,023,196.00 $ -40,420,589.01

$ 5,674,648.21 $ 5,684,451.00 $

.9,802.79

$ 33,941,439.86

1,898,979.63 509,652.53
33,941,439.86 98,650.00
1,420,333.79 600,000.00 200,000.00
1,273,869.00

1,919,087.00 272,000.00
55,915,350.00 148,000.00
1,595,382.00 600,000.00 200,000.00
1,273,869.00

20,107.37 -237,652.53 21,973,910.14
49,350.00 175,048.21
0.00 0.00 0.00

17,415,057.00

17,415,057.00

0.00

$ 33,941,439.86 $ 63,032,630.02 $ 85,023,196.00 $ 21,990,565.98

$ -18,463,360.47 $ -18,430,023.03

$ -18,430,023.03

-29 -

THIS PAGE LEn BLANK

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET "0" LOTTERY FOR EDUCATION YEAR ENDED JUNE30,1998

SCHEDULE "3"

EXPENDITURES

Equipment, Technology and Construction

Trust Fund

$

Georgia Public Telecommunications

Commission

InternetConnection Initiative

Special Funding Initiatives

CapitalOutiay- Albany State College

GeorgiaResearch Alliance

0,00
1,500,000.00 6,454,221,67 4,803,618,75
0,00 $

$

12,757,840.42 $

Excessof Revenuesover Expenditures

$

745.58 $

$

0,00 $

71,553.00 $

1,500,000.00

6,454,221.67

4,803,618,75

0.00

0.00

0.00

1,500,000,00 6,454,422.00 4,805,650,00 3,837,821.00 6,246,661.00

71,553,00
0.00 200.33 2,031.25 3,837,821.00 6,246,661,00

0,00 $ 12,757,840.42 $ 22,916,107,00 $

10,158,266.58

0.00 $

745.58

$

745,58

see notes to the financialstatements.

- 31 -

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF APPROVED BUDGET "A" RESIDENT INSTRUCTION YEAR ENDED JUNE 30,1998

REVENUES
State Appropriation Other Revenues Retained
EXPENDITURES
Personal Services: Education, Generaland Departmental Services Sponsored Operations
Operating Expenses: Education, Generaland Departmental Services Sponsored Operations
Capital Outlay Special Funding Initiative Office of Minority Business Enterprise Student Education Enrichment Program Forestry Research Research Consortium Year 2000 Project

ORIGINAL APPROPRIATION

AMENDED APPROPRIATION

GOVERNOR'S EMERGENCY FUNDS

$ 1,248,280,988,00 $ 806,031,366,00

52,738,064,00 $

107,500.00

$ 2,054,312,354,00 $ 52,738,064.00 $ ===========1=0=7=,=5=0=0=.0=0=

$ 1,346,731,158.00 204,900,000.00

327,745,456.00 $ 146,225,000.00
419,000.00 19,622,118.00
1,491,151.00 351,860.00 741,611.00
6,085,000.00

5,350,000.00 $ 5,020,000,00
42,368,064,00

107,500,00

$ 2,054,312,354.00 $ 52,738,064.00 $ ============1=0=7=,=5=0=0=.=0=0=

See notesto the financialstatements.

32-

SCHEDULE "4"

BUDGET ADJUSTMENTS

TOTAL APPROVED
BUDGET

LESS: BUDGET TRANSFERS TO OTHER UNITS

TOTAL

$

788,868.00 $ 1,301,915,420.00 $ 1,279,988,761.00 $ 21,926,659.00

791,442,853.00 1,597,474,219.00

1,586,073,058.00

11,401,161.00

$ 792,231,721.00 $ 2,899,389,639.00 $ 2,866,061,819.00 $ 33,327,820.00

$

880,788.00.$ 1,347,611,946.00 $ 1,342,351,743.00 $ 5,260,203.00

16,139,911.00

221,039,911.00

221,039,911.00

0.00

97,539,100.00 509,315,647.00 167,567,407.00
788,868.00

430,742,056.00 655,540,647.00 173,006,407.00
19,622,118.00 1,491,151.00 351,860.00 741,611.00
48,453,064.00 788,868.00

411,289,431.00 655,540,647.00 172,447,407.00
14,614,994.00 1,491,151.00 351,860.00 741,611.00
46,193,064.00

19,452,625.00 0.00
559,000.00 5,007,124.00
0.00 0.00 0.00 2,260,000.00 788,868.00

$ 792,231,721.00 $ 2,899,389,639.00 $2,866,061,819.00 $ 33,327,820.00

-33-

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNJD SCHEDULE OF APPROVED BUDGET
"B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30,1998

REVENUES
State Appropriation Other Revenues Retained
EXPENDITURES
Personal Services: Education, Generaland Departmental Services Sponsored Operations
Operating Expenses: Education, Generaland Departmental Services Sponsored Operations
Capital Outlay Agricultural Research Advanced Technology Development Center Capitation Contractsfor Family Practice
Residency Residency Capitation Grants Student Preceptorships Mercer MedicalSchool Grant Morehouse School of MedicineGrant Centerfor Rehabilitation Technology SREB Payments Medical Scholarships Regents Opportunity Grants Regents Scholarships Rental Payments to Georgia MilitaryCollege CRT Inc, Contract at GeorgiaTech
Research Institute Direct Payments to the Georgia Public
Telecommunications Commission for Operations

ORIGINAL APPROPRIATION

AMENDED APPROPRIATION

GOVERNOR'S EMERGENCY FUNDS

$

180,416,759.00 $

402,127,146,00

3,152,096.00 $ 26,360.00

$ 582,543,905,00 $

3,178,456.00 $

10,000.00
=1=0=,0=0=0.=00=

$ 278,691,453.00 $ 70,533,799.00
128,037,390.00 42,274,927,00
2,497,965.00 14,189,218.00
3,864,204.00 2,119,378,00
146,400.00 7,210,000.00 6,044,890.00 3,049,004.00 4,653,750.00 1,386,882.00
600,000.00 200,000.00 1,273,869,00
193,815,00
15,576,961.00

80,604.00 809,756.00 $ 450,000,00
1,838,096.00

$ 582,543,905,00 $

3,178,456,00 $

10,000.00
=1=0=,0-0=0=.=00=

See notes to the financialstatements,

-34-

SCHEDULE "5"

- BUDGET ADJUSTMENTS

TOTAL APPROVED
BUDGET

LESS: BUDGET TRANSFERS TO OTHER UNITS

TOTAL

$ 183,578,855.00 $

$ 150,555,862.00

552,709,368.00

155,793,541.00 $ 27,785,314.00

495,471,486.00

57,237,882.00

$ 150,555,862.00 $ 736,288,223.00 $ 651,265,027.00 $ 85,023,196.00

$

148,542.00 $ 278,920,599.00 $

51,594,821.00

122,128,620.00

273,236,148.00 $ 122,128,620.00

5,684,451.00 0.00

6,608,648.00 31,579,462.00 55,985,350.00
3,358,319.00
1,072,220.00 208,500.00

135,465,794.00 73,854,389.00 55,985,350.00
2,497,965.00 17,547,537.00
3,864,204.00 2,119,378.00
146,400.00 7,210,000.00 6,494,890.00 4,121,224.00 4,653,750.00 1,595,382.00
600,000.00 200,000.00 1,273,869.00
193,815.00

133,546,707.00 73,582,389.00
70,000.00 2,497,965.00 17,547,537.00
3,864,204.00 2,119,378.00
146,400.00 7,210,000.00 6,494,890.00 4,121,224.00 4,505,750.00
193,815.00

1,919,087.00 272,000.00
55,915,350.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 148,000.00 1,595,382.00 600,000.00 200,000.00 1,273,869.00
0.00

17,415,057.00

17,415,057.00

$ 150,555,862.00 $ 736,288,223.00 $ 651,265,027.00 $ 85,023,196.00

-35-

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGiA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF APPROVED BUDGET "D" LOTIERY FOR EDUCATION YEAR ENDED JUNE30. 1998

REVENUES State Appropriation Other Revenues Retained
EXPENDITURES Equipment, Technology and Construction
Trust Fund Georgia PublicTelecommunications
Commission Intemet Connection Initiative Special Funding Initiative Capital Outlay- Albany State College Georgia Research Alliance

ORIGINAL APPROPRIATION

AMENDED APPROPRIATION

$

33,054,422.00 $

2,000,000.00

$ 33,054,422.00 $ =====2=,=0=0=0=,0=0=0=.0=0=

$

15,000,000.00

1,500,000.00 6,454,422.00 10,100,000.00 $

2,000,000.00

$ 33,054,422.00 $ ======2=,=0=0=0=,0=0=0=.=0=0=

See notes to the financialstatements.

-36 -

SCHEDULE "6"

BUDGET ADJUSTMENTS

TOTAL APPROVED
BUDGET

LESS: BUDGET TRANSFERS TO OTHER UNITS

TOTAL

$ 35,054,422.00 $

$ 10,157,521.00

10,157,521.00

22,295,836.00 $ 12,758,586.00 10,157,521.00

$ 10,157,521.00 $ 45,211,943.00 $

22,295,836.00 $ 22,916,107.00

$

71,553.00 $ 15,071,553.00 $

1,486.00 3,837,821.00 6,246,661.00

1,500,000.00 6,454,422.00 12,101,486.00 3,837,821.00 6,246,661.00

15,000,000.00 $ 7,295,836.00

71,553.00
1,500,000.00 6,454,422.00 4,805,650.00 3,837,821.00 6,246,661.00

$ 10,157,521.00 $ 45,211,943.00 $

22,295,836.00 $ 22,916,107.00

-37 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNm SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS "A" RESIDENT INSTRUCTION YEAR ENDED JUNE 30. 1998

UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA
RESEARCH UNIVERSITIES
Georgia Institute ofTechnology Research Consortium Regular Advanced Technology Development center Georgia Tech Research Institute Special Funding Initiative Regular Advanced Technology Development center
Georgia State University Research Consortium Regular Special Funding Initiative
Medical College of Georgia Research Consortium 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 Atlantic State University Special Funding Initiative
Augusta State University Office of Minority Business Enterprise 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 Southwestern State University Special Funding Initiative
Kennesaw State University Special Funding Initiative
See notes to the financial statements.

PERSONAL SERVICES

ED~CATION,

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

APPROVED BUDGET

OPERATING EXPENSES

EDUCATION,

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

$ 181,088,286.00 $ 57,778,106.00 $

63,567,778.00 $ 59,409,394.00

162,067,765.00

25,000,000.00

51,553,398.00

110,000,000.00

82,843,439.00

45,418,547.00

30,194,774.00

22,737,764.00

315,870,050.00

60,000,000.00

96,413,039.00

160,000,000.00

76,036,677.00 48,309,377.00

2,963,131.00 1,273,341.00

20,466,852.00 12,207,444.00

59,739,346.00 38,305,156.00

19,665,546.00
23,644,498.00 24,056,609.00
21,005,128.00 26,153,026.00 18,057,621.00 27,002,288.00 13,257,855.00 50,919,664.00

2,697,785.00
592,248.00 340,741.00
1,759,082.00 1,493,623.00 7,653,028.00
505,903.00 1,140,813.00 1,667,746.00

3,423,865.00

22,865,612.00

7,885,656.00 5,775:216.00

6,349,916.00 4,870,826.00

8,548,625.00 6,406,353.00 4,968,402.00 7,291,962.00 4,591,742.00 15,347,552.00

6,467,596.00 16,694,512.00 25,240,318.00 16,138,611.00
4,250,762.00 11,594,429.00

-38-

SCHEDULE '7"

CAPITAL OUTLAY

OTHER

TOTAL

STATE FUNDS

FUNDING PROVIDED OTHER
REVENUES RETAINED

TOTAL

$ 23,819,497.00

$ 385,663,061.00 $ 136,920,267.00 $ 248,742,794.00 $ 385,663,061.00

$ 14,887,431.00

14,887,431.00

14,887,431.00

14,887,431.00

878,236.00 593,299.00

878,236.00 593,299.00

878,236.00 593,299.00

878,236.00 593,299.00

1,787,600.00

1,787,600.00

1,787,600.00

1,787,600.00

14,331,089.00

40,871.00

40,871.00 362,952,252.00

40,871.00 142,439,924.00

220,512,328.00

40,871.00 362,952,252.00

9,273,612.00 69,834,724.00

10,088,064.00 836,080.00
1,871,000.00 351,860.00
1,757,620.00
741,611.00 481,151.00

10,088,064.00 836,080.00
190,468,136.00 1,871,000.00 351,860.00 1,757,620.00
702,117,813.00 741,611.00 481,151.00

10,088,064.00 836,080.00
93,708,295.00 1,871,000.00 351,860.00 1,757,620.00
298,238,611.00 741,611.00 481,151.00

96,759,841.00 403,879,202.00

10,088,064.00 836,080,00
190,468,136.00 1,871,000.00 351,860.00 1,757,620.00
702,117,813.00 741,611.00 481,151.00

17,650,502.00 154,352.00
1,373,958.00

17,650,502.00 154,352.00
1,373,958.00

17,650,502.00 154,352.00
1,373,958.00

17,650,502.00 154,352.00
1,373,958.00

10,684,900.00 3,081,574.00

31,250.00 743,574.00
38,930.00 256,520.00

169,890,906.00 31,250.00
743,574.00 103,176,892.00
38,930.00 256,520.00

65,880,640.00 31,250.00
743,574.00 41,945,096.00
38,930.00 256,520.00

104,010,266.00 61,231,796.00

169,890,906.00 31,250.00
743,574.00 103,176,892.00
38,930.00 256,520.00

774,285.00
1,204,800.00 2,348,895.00
1,201,931.00 2,908,170.00 3,233,302.00 2,340,844.00 1,584,223.00 3,963,188.00

60,000.00 263,766.00 361,230.00 200,000.00 231,653.00 123,124.00 2,462,401.00 537,331.00 163,840.00 634,898.00 . 230,649.00

49,427,093.00 60,000.00
263,766.00 39,677,118.00
361,230.00 37,392,287.00
200,000.00 231,653.00 38,982,362.00 123,124.00 53,655,684.00 2,462,401.00 59,152,671.00 537,331.00 53,279,608.00 163,840.00 24,825,395.00 634,898.00 83,492,579.00 230,649.00

16,933,468.00 60,000.00
263,766.00 21,236,765.00
361,230.00 22,084,618.00
200,000.00 231,653.00 16,876,853.00 123,124.00 22,707,856.00 2,462,401.00 18,390,495.00 537,331.00 25,195,122.00 163,840.00 12,780,778.00 634,898.00 38,489,965.00 230,649.00

32,493,625.00
18,440,353.00 15,307,669.00
22,105,509.00 30,947,828.00 40,762,176.00 28,084,486.00 12,044,617.00 45,002,614.00

49,427,093.00 60,000.00 263,766.00
39,677,118.00 361,230.00
37,392,287.00 200,000.00 231,653.00
38,982,362.00 123,124.00
53,655,684.00 2,462,401.00
59,152,671.00 537,331.00
53,279,608.00 163,840.00
24,825,395.00 634,898.00
83,492,579.00 230,649.00

- 39-

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF BUDGETTRANSFERS TO OTHERUNITS wAwRESIDENT INSTRUCTION YEAR ENDED JUNE 30. 1998

UNITSOF THE UNIVERSITY SYSTEM OF GEORGIA
STATE UNIVERSITIES/COLLEGES
North GeorgiaCollege and State University Special Funding Initiative
Savannah State University Office of MinorityBusinessEnterprise SpecialFunding Initiative
SouthernPolytechnicState University Special Funding Initiative
State Universityof West Georgia Special FundingInitiative
ASSOCIATE DEGREECOLLEGES
AbrahamBaldwinAgricultural College Special FundingInitiative
AUanta Metropolitan College Office of Minority BusinessEnterprise Special FundingInitiative
Bainbridge College Special Funding Initiative
Coastal GeorgiaCommunityCollege Special FundingInitiative
Dalton College Special FundingInitiative
Darton College Special FundingInitiative
DeKalbCollege Special FundingInitiative
East Georgia College Special Funding Initiative
Floyd College Special FundingInitiative
GainesvilleCollege Special FundingInitiative
Gordon College Special FundingInitiative
Macon State College SpecialFunding Initiative
MiddleGeorgia College Special Funding Initiative
South GeorgiaCollege Special Funding Initiative
Waycross College Special FundingInitiative
OTHER
SkidawayInstitute of Oceanography SpecialFunding Initiative

PERSONAL SERVICES

EDUCATION,

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

APPROVED BUDGET

OPERATING EXPENSES

EDUCATION,

GENERALAND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

$

16,574,321.00 $

373,139.00 $

18,423,225.00

1,390,079.00

4,203,001.00 $ 4,486,300.00

4,319,789.00

12,605,039.00

22,068,986.00 37,962,211.00

798,518.00 1,156,833.00

5,061,506.00 10,480,269.00

8,205,585.00 21,006,528.00

11,611,293.00 7,001,014.00
4,257,120.00 6,731,455.00 9,096,408.00 9,947,320.00 47,196,756.00 3,285,819.00 10,166,387.00 10,448,402.00 7,731,961.00 12,649,422.00 8,979,n3.00 5,080,292.00 3,161,749.00

844,681.00 546,886.00
829,372.00 852,141.00 1,658,738.00 450,450.00 211,951.00
54,038.00 505,939.00 184,296.00
418,885.00 137,658.00 305,226.00
36,987.00

2,391,132.00 2,921,188.00
1,185,448.00 1,728,299.00 2,860,526.00 3,060,046.00 16,266,791.00
840,563.00 4,252,817.00 2,325,664.00 2,117,013.00 2,919,932.00 2,491,776.00 2,150,088.00 1,070,925.00

3,189,115.00 3,285,074.00
1,872,077.00 2,441,539.00 4,054,711.00 3,273,637.00 11,035,279.00
791,595.00 1,807,263.00 2,245,211.00 1,769,750.00 3,610,048.00 2,506,534.00 1,457,401.00 1,233,719.00

$ 1,342,351,743.00 $ 221,039,911.00 $ 411,289,431.00 $ 655,540,647.00

See notes to the financial statements.

-40-

SCHEDULE 'T'

CAPITAL OUTLAY

OTHER

TOTAL

STATE FUNDS

FUNDING PROVIDED OTHER
REVENUES RETAINED

TOTAL

$ 3,124,658.00 $
2,684,201.00
748,970.00
4,357,652.00

$ 107,011.00
550,000.00 469,598.00
104,501.00
383,004.00

28,761,419.00 $ 107,011.00
39,422,333.00 550,000.00 469,598.00
36,883,565.00 104,501.00
74,963,493.00 383,004.00

15,608,250.00 $ 107,011.00
18,033,566.00 550,000.00 469,598.00
18,716,175.00 104,501.00
35,251,969.00 383,004.00

13,153,169.00 $ 21,388,767.00
18,167,390.00 39,711,524.00

28,761,419.00 107,011.00
39,422,333.00 550,000.00 469,598.00
36,883,565.00 104,501.00
74,963,493.00 383,004.00

1,176,300.00 482,600.00
216,000.00 450,600.00 727,000.00 585,500.00 1,781,012.00 356,710.00 947,759.00 788,862.00 253,000.00 488,500.00 1,484,449.00 676,700.00 296,300.00

111,685.00 200,000.00
99,402.00 95,158.00 163,346.00 93,547.00 100,735.00 150,820.00 113,543.00 104,676.00 100,609.00 109,002.00 107,049.00 141,327.00 113,889.00 98,227.00

19,212,521.00 111,685.00
14,236,762.00 200,000.00 99,402.00
8,360,017.00 95,158.00
12,204,034.00 163,346.00
18,397,383.00 93,547.00
17,316,953.00 100,735.00
76,491,789.00 150,820.00
5,328,725.00 113,543.00
17,680,165.00 104,676.00
15,992,435.00 100,609.00
11,871,724.00 109,002.00
20,086,787.00 107,049.00
15,600,190.00 141,327.00
9,669,707.00 113,889.00
5,799,680.00 98,227.00

11,372,606.00 111,685.00
7,270,488.00 200,000.00 99,402.00
4,272,579.00 95,158.00
6,684,514.00 163,346.00
8,848,905.00 93,547.00
10,085,226.00 100,735.00
44,031,390.00 150,820.00
3,339,602.00 113,543.00
10,503,266.00 104,676.00
9,721,127.00 100,609.00
7,544,234.00 109,002.00
12,028,631.00 107,049.00
10,089,183.00 141,327.00
5,617,746.00 113,889.00
3,512,271.00 98,227.00

7,839,915.00 6,966,274.00
4,087,438.00 5,519,520.00 9,548,478.00 7,231,727.00 32,460,399.00 1,989,123.00 7,176,899.00 6,271,308.00 4,327,490.00 8,058,156.00 5,511,007.00 4,051,961.00 2,287,409.00

19,212,521.00 111,685.00
14,236,762.00 200,000.00 99,402.00
8,360,017.00 95,158.00
12,204,034.00 163,346.00
18,397,383.00 93,547.00
17,316,953.00 100,735.00
76,491,789.00 150,820.00
5,328,725.00 113,543.00
17,680,165.00 104,676.00
15,992,435.00 100,609.00
11,871,724.00 109,002.00
20,086,787.00 107,049.00
15,600,190.00 141,327.00
9,669,707.00 113,889.00
5,799,680.00 98,227.00

235,600.00

42,750.00

235,600.00 42,750.00

235,600.00 42,750.00

235,600.00 42,750.00

$ 172,447,407.00 $ 63,392,680.00 $ 2.866,061.819.00 $ 1,279,988,761.00 $ 1,586,073,058.00 $ 2,866,061,819.00

-41 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNm SCHEDULE OF BUDGET TRANSFERS TO OTHERUNITS
"B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTMTIES YEARENDED JUNE30, 1998

UNITSOF THE UNIVERSITY SYSTEM OF GEORGIA

PERSONAL SERVICES

EDUCATION,

GENERAL AND

DEPARTMENTAL SPONSORED

SERVICES

OPERATIONS

APPROVED BUDGET

OPERATING EXPENSES

EDUCATION,

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

RESEARCH UNIVERSITIES

Georgia Instituteof Technology

Education Extension Services

Advanced Technology Development Center

GeorgiaTech Research Institute

$

Agricultural Research

Centerfor Rehabilitation Technology

CRT Inc, at GeorgiaTech Research Institute

Medical College of Georgia

Medical College of Georgia Hospital and Clinics

Joint Boardof FamilyPractice

Capitation Contracts for FamilyPractice Residency

Residency Capitation Grants

StudentPreceptorships

MercerMedicalSchoolGrant

Morehouse Schoolof Medicine Grant

SREB Payments

GeorgiaRadiation TherapyCenter

University of Georgia

Agricultural Experiment Station

Athensand TiftonVeterinary Laboratories

Cooperative Extension Service

Marine Institute

MarineResources Extension Center

Veterinary Medicine Experiment Station

Agricultural Research

Veterinary Medicine Teaching Hospital

18,242,883.00 $ 52,000,000.00 $

167,944,892,00 330,367.00

45,824,949.00

2,033,088.00
39,562,219.00 137,561.00
37,591,149.00 524,325.00
1,378,7n.OO 1,791,786.00
1,935,700.00

9,500,000.00 2,497,454.00 9,800,000.00
600,000,00 340,000.00

13,102,794.00 $ 26,000,000.00

94,129,518.00 756,467.00

29,452,970.00

1,671,820.00
12,939,360,00
5,470,992,00 599,131.00 664,991.00 260,358.00
3,182,305.00

10,500,000.00 1,106,516.00 5,200,000,00 150,000.00 160,000.00

ASSOCIATE DEGREE COLLEGE

MiddleGeorgiaCollege

10,000.00

Skidaway Instituteof Oceanography

1,763,401.00

1,566,217.00

758,971.00

1,012,903,00

$ 273,236,148.00 $ 122,128,620.00 $ 133,546,707.00 $ 73,582,389.00

See notesto the financialstatements.

-42 -

SCHEDULE "8"

CAPITAL OUTLAY

OTHER

TOTAL

STATE FUNDS

FUNDING PROVIDED OTHER
REvENUES RETAINED

TOTAL

$ 17.547.537.00 $ 17,547,537.00 $

109,345,677.00

1.565,976.00

1,565,976.00

4,121,224.00

4,121.224.00

193,815.00

193,815.00

7,061.177.00 7,948,878.00
1.263,099.00

$ 10,486,360.00 101.396,799.00 1,565.976.00 2,858,125.00 193,815.00

$ 17,547,537.00 109,345,677.00 1,565.976.00 4,121,224.00 193,815.00

3,864,204.00 2,119,378.00
146,400.00 7.210,000.00 6,494,890.00 4,505,750.00

337,352,329.00 1,086,834.00 3,864,204.00 2,119,378.00 146,400.00 7,210,000.00 6,494,890.00 4,505.750.00 3,704.908.00

33,608,599.00 1,086,834.00 3,864,204.00 2.119,378.00 146,400.00 7,210,000.00 6,494,890.00 4.505,750.00

303,743,730.00 3,704.908.00

337,352,329.00 1,086,834.00 3,864,204.00 2,119,378.00 146,400.00 7,210,000.00 6,494,890.00 4,505,750.00 3,704.908.00

931,989.00

72,501,579.00 3,741,531.00
58.062,141.00 1,873,456.00 2,543,768.00 2,052.144.00 931,989.00 5,118,005.00

40,136,393.00 137,561.00
32,518,352.00 1,005,675.00 1,458,968.00 2,052,144.00 931,989.00 535,878.00

32,365,186.00 3,603,970.00 25,543,789.00 867,781.00 1,084,800.00
4,582,127.00

72,501,579.00 3,741,531.00 58,062,141.00 1,873,456.00 2,543,768.00 2,052,144.00 931,989.00 5,118,005.00

10,000.00

10,000.00

10,000.00

$ _ _7:0.,.0.0:0..L0:0=~

5,171,492.00

1,697,372.00

3,474,120.00

5,171,492.00

$

70,000.00 $ 48,701,163.00 $ 651,265,027.00 $ 155,793,541.00 $ 495,471,486.00 $ 651,265,027.00

43 -

THIS PAGE LEn BLANK

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE <OVERSIGHT UNID SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS "0" LOTTERY FOR EDUCATION YEAR ENDED JUNE 30. 1998

SCHEDULE "9"

UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA
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

APPROVED BUDGET

EQUIPMENT,

TECHNOLOGY

AND

SPECIAL

CONSTRUCTION

FUNDING

TRUST FUND

INITIATIVES

TOTAL

FUNDING PROVIDED
STATE FUNDS

$ 3,437,000.00 $ 540,243.00 $ 3,977,243.00 $ 3,977,243.00

1,427,000.00

556,413.00

1,983,413.00

1,983,413.00

682,000.00

417,380.00

1,099,380.00

1,099,380.00

3,437,000.00

892,421.00

4,329,421.00

4,329,421.00

457,000.00 425,000.00

391,842.00 309,693.00

848,842.00 734,693.00

848,842.00 734,693.00

174,000.00 238,000.00 238,000.00 712,000.00 237,000.00 116,000.00 228,000.00 116,000.00 291,000.00 126,000.00 174,000.00 184,000.00 291,000.00

177,485.00 433,750.00 175,090.00 176,696.00 195,315.00 170,793.00 225,170.00 144,965.00 230,323.00 152,633.00 146,005.00 172,085.00 301,470.00

351,485.00 671,750.00 413,090.00 888,696.00 432,315.00 286,793.00 453,170.00 260,965.00 521,323.00 278,633.00 320,005.00 356,085.00 592,470.00

351,485:00 671,750.00 413,090.00 888,696.00 432,315.00 286,793.00 453,170.00 260,965.00 521,323.00 278,633.00 320,005.00 356,085.00 592,470.00

116,000.00 39,000.00 68,000.00 58,000.00 146,000.00 116,000.00 230,000.00 29,000.00 567,000.00 116,000.00 116,000.00 158,900.00 116,000.00 58,000.00 26,100.00

84,881.00 95,575.00
71,998.00
94,687.00 80,559.00 84,214.00 246,516.00 64,361.00 98,118.00 105,566.00 76,380.00 134,687.00 81,071.00 86,036.00 75,415.00

200,881.00 134,575.00 139,998.00 152,687.00 226,559.00 200,214.00 476,516.00 93,361.00 665,118.00 221,566.00 192,380.00 293,587.00 197,071.00 144,036.00 101,515.00

200,881.00 134,575.00 139,998.00 152,687.00 226;559.00 200,214.00 476,516.00 93,361.00 665,118.00 221,566.00 192,380.00 293,587.00 197,071.00 144,036.00 101,515.00

50,000.00

6,000.00

56,000.00

56,000.00

$ 15,000,000.00 $ 7,295,836.00 $ 22,295,836.00 $ 22,295,836.00

See notes to the financial statements.

-45 -

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID CHANGES IN INVESTMENT IN PLANT YEAR ENDED JUNE 30, 1998

Land Equipment Library Books and Collections Construction in Progress
SUMMARY OF INVESTMENT Administrative CentralOffice Capital Leases

BALANCE JULY 1,1997

CURRENTFUNDS UNRESTRICTED

$

2,501,877,00

13,385,846.92 $

6,907,716.15

31,384.30

122,638,517,34

200,000.00

$ 138,557,625.56 $ =======7=,1=:0::7!.,i7==1=6=.1=5==

$ 138,543,581.11 $ 14,044.45

7,107,716.15

$ 138,557,625.56 $ ======7=,=1=0=7=,7=1=6=.=1=5=

See notesto the financial statements.

-46-

SCHEDULE "10"

ADDITIONS PLANT FUNDS UNEXPENDED

$

$

32,841,198.53

CAPITAL LEASES

DEDUCTIONS DISPOSALS! DELETIONS! ADJUSTMENTS

$

1,251,260.46 $

2,432,041.48

BALANCE JUNE 30,1998
2,501,877.00 19,112,782.05
31,384.30 155,679,715.87

$

32,841,198.53 $

1,251,260.46 $

-================ 2,432,041.48 $

177,325,759.22

$

32,841,198.53

$

------$--..;.:;;;.;;..;..:..1;,;2=51.,.2;6.0;.;4.6..

2,066,444.52 $
365,596.96

176,426,051.27 899,707.95

$

32,841,198.53 $

1,251,260.46 $

=============== 2,432,041.48 $

177,325,759.22

-47 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF FUNDBALANCES CURRENT FUNDS AND PLANTFUNDS JUNE 30.1998

NET INVESTMENT IN PLANT Investmentin Plant Facilities
RESTRICTED Designated for Subsequent Years' Expenditures
UNRESTRICTED Designated For Capital Outlay- Albany State University Flood Recovery Project For Georgia Research Alliance GeorgiaCenterfor Advanced Telecommunications Technology For PropertyReserve For Employee HealthBenefits Plan For Year 2000 Project Surplus Regular Lotteryfor Education

"A" RESIDENT INSTRUCTION

CURRENTFUNDS

UNRESTRICTED

"B"

REGENTS CENTRAL

OFFICEAND

liD"

OTHERORGANIZED LOTTERY FOR

ACTIVITIES

EDUCATION

$ 788,868.00 41,915.25 $
$ 830,783.25 $ $ 830,783.25 $

57,259.01 $
57,259.01 $

1,492.58 1,492.58

=========== 57,259.01 $

1,492.58

See notesto the financialstatements.

-48-

SCHEDULE "11"

EMPLOYEE HEALTH BENEFITS PLAN

RESTRICTED

PLANT FUNDS

UNEXPENDED

LOTTERY FOR

REGULAR

EDUCATION

INVESTMENT IN PLANT

TOTAL

$ 176,426,051.27 $ 176,426,051.27

$ 4,265,061.07

$ 4,265,061.07

$ 8,016,827.21

$ 8,016,827.21

$ 16,763,897.95

718,606.47 2,196,632.95

718,606.47 2,196,632.95 16,763,897.95
788,868.00

$ 16,763,897.95

- - - - - $ ---.1.4;,5.1~2=.2'9-
$ 10,932,066.63 $ _---.1;4.,~51=2;.;2.9-

99,174.26 16,004.87
$ 28,600,011.71

$ 16,763,897.95 $ 4,265,061.07 $ 10,932,066.63 $

14,512.29 $ 176,426,051.27 $ 209,291,124.05

-49-

BOARDOF REGENTS OF !HE UNIVERSITY SYSTEMOF GEORGIA ADMINISTRATIVE CENTRAL OFFICE(OVERSIGHT UNm
SCHEDULE OF ALLOTMENTS TO UNITSOF THE UNIVERSITY SYSTEMOF GEORGIA nAn RESIDENT INSTRUCTION
YEAR ENDED JUNE 30. 1998

RESEARCH UNIVERSITIES
GeorgiaInstituteof Technology GeorgiaState University MedicalCollege of Georgia Universityof Georgia
REGIONAL UNIVERSITIES
GeorgiaSouthem University Valdosta State University
STATE UNIVERSITIES/COLLEGES
Albany State University ArmstrongAtlantic State University Augusta State University ClaytonCollege and State University ColumbusState University Fort Valley State University GeorgiaCollege and State University GeorgiaSouthwestem State University Kennesaw State University North GeorgiaCollege and State University Savannah State University Southem PolytechnicState University State Universityof West Georgia
ASSOCIATE DEGREE COLLEGES
Abraham BaldwinAgriculturalCollege Atlanta Metropolitan College BainbridgeCollege CoastalGeorgia CommunityCollege Dalton College Darton College DeKaib College East GeorgiaCollege . Floyd College GainesvilleCollege Gordon College Macon State College Middle Georgia College South GeorgiaCollege Waycross College
OTHER
SkidawayInstitute of Oceanography

REGULAR

CAPITAL OUTLAY

SPECIAL FUNDING INITIATIVE

$ 136,920,267.00 142,439,924.00 93,708,295.00 293,338,611.00 $

$ 4,900,000.00

1,828,471.00 836,080.00
1,757,620.00 1,373,958.00

65,880,640.00 41,945,096.00

743,574.00 256,520.00

16,933,468.00 21,236,765.00 22,084,618.00 16,876,853.00 22,707,856.00 18,390,495.00 25,195,122.00 12,780,n8.00 38,489,965.00 15,608,250.00 18,033,566.00 18,716,175.00 35,251,969.00

263,766.00 361,230.00 231,653.00 123,124.00 2,462,401.00 537,331.00 163,840.00 634,898.00 230,649.00 107,011.00 469,598.00 104,501.00 383,004.00

11,372,606.00 7,270,488.00 4,272,579.00 6,684,514.00 8,848,905.00 10,085,226.00 44,031,390.00 3,219,602.00 10,503,266.00 9,721,127.00 7,544,234.00 12,028,631.00 10,029,183.00 5,617,746.00 3,512,271.00

120,000.00 60,000.00

111,685.00 99,402.00 95,158.00 163,346.00 93,547.00 100,735.00 150,820.00 113,543.00 104,676.00 100,609.00 109,002.00 107,049.00 141,327.00 113,889.00 98,227.00

235,600.00

42,750.00

$ 1,211,516,081.00 $

5,080,000.00 $

14,614,994.00

See notes to the financial statements.

- 50-

SCHEDULE "12"

OFFICE OF MINORITY BUSINESS ENTERPRISE

STUDENT EDUCATION ENRICHMENT PROGRAM

FORESTRY RESEARCH

RESEARCH CONSORTIUM

TOTAL

$

16,358,966.00 $ 155,107,704.00

10,088,064.00

153,364,068.00

$

351,860.00

1,871,000.00

97,688,775.00

$

481,151.00

$

741,611.00

17,804,854.00

318,640,185.00

31,250.00 38,930.00

66,655,464.00 42,240,546.00

60,000.00 200,000.00
550,000.00

17,257,234.00 21,597,995.00 22,516,271.00 16,999,977.00 25,170,257.00 18,927,826.00 25,358,962.00 13,415,676.00 38,720,614.00 15,715,261.00 19,053,164.00 18,820,676.00 35,634,973.00

200,000.00

11,484,291.00 7,569,890.00 4,367,737.00 6,847,860.00 8,942,452.00 10,185,961.00 44,182,210.00 3,453,145.00 10,607,942.00 9,821,736.00 7,653,236.00 12,135,680.00 10,230,510.00 5,731,635.00 3,610,498.00

278,350.00

$

1,491,151.00 $

351,860.00 $

741,611.00 $

46,193,064.00 $ 1,279,988,761.00

- 51 -

BOARDOF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
SCHEDULE OF ALLOTMENTS TO UNITSOF THE UNIVERSITY SYSTEM OF GEORGIA "B" REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30, 1998

SCHEDULE "13"

RESEARCH UNIVERSITIES
GeorgiaInstituteof Technology Education Extension Services Advanced Technology Development Center GeorgiaTech Research Institute Agricultural Research Centerfor Rehabilitation Technology
MedicalCollegeof Georgia MedicalCollegeof GeorgiaHospital and Clinics Joint Board of FamilyPractice Capitation Contracts for FamilyPractice Residency MercerSchool of Medicine Grant Morehouse Schoolof Medicine Grant Residency Capitation Grants Student Preceptors hips SREB Payments
University of Georgia AgriCUltural Experiment Station Athens and Tifton Veterinary Laboratories Cooperative Extension Service Marine Institute Marine Resources Extension Center VeterinaryMedicineExperiment Station Agricultural Research Veterinary MedicineTeaching Hospital
ASSOCIATE DEGREE COLLEGE
Middle Georgia College

$

7,061,177,00

7,948,878.00

1,263,099.00

33,608,599.00 1,086,834.00 3,864,204.00 7,210,000.00 6,494,890:00 2,119,378.00 146,400.00 4,505,750.00

40,136,393.00 137,561.00
32,518,352.00 1,005,675.00 1,458,968.00 2,052,144.00 931,989.00 535,878,00

10,000.00

SkidawayInstitute of Oceanography

1,697,372.00 $ 155,793,541.00

See notesto the financialstatements,

-52-

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 "D" LOTTERY FOR EDUCATION YEAR ENDED JUNE 30, 1998

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 Southem 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 State College Middle Georgia College South Georgia College Waycross College
OTHER
Skidaway Institute of Oceanography

EQUIPMENt, TECHNOLOI3Y
AND CONSTRUCTION
TRUST FUND

SPECIAL FUNDING INITIATIVES

TOTAL

$

3,437,000,00 $

1,427,000,00

682,000.00

3,437,000.00

540,243,00 $
556,413,00 417,380,00 892,421.00

3,977,243.00 1,983,413,00 1,099,380.00 4,329,421,00

457,000,00 425,000,00

391,842,00 309,693,00

848,842,00 734,693,00

174,000,00 238,000,00 238,000,00 712,000,00 237,000,00 116,000,00 228,000,00 116,000.00 291,000.00 126,000.00 174,000.00 184,000,00 291,000.00

177,485,00 433,750,00 175,090.00 176,696.00 195,315,00 170,793.00 225,170,00 144,965,00 230,323,00 152,633.00 146,005.00 172,085,00 301,470,00

351,485,00 671,750,00 413,090.00 888,696.00 432,315,00 286,793,00 453,170,00 260,965.00 521,323.00 278,633.00 320,005.00 356,085.00 592,470,00

116,000.00 39,000.00 68,000.00 58,000.00
146,000.00 116,000.00 230,000,00
29,000.00 567,000.00 116,000.00 116,000.00 158,900,00 116,000,00
58,000.00 26,100.00

84,881.00 95,575.00 71,998,00 94,687.00 80,559.00 84,214,00 246,516,00 64,361.00 98,118.00 105,566,00 76,380.00 134,687,00 81,071.00 86,036.00 75,415.00

200,881,00 134,575.00 139,998.00 152,687,00 226,559.00 200,214,00 476,516.00
93,361.00 665,118,00 221,566,00 192,380,00 293,587.00 197,071.00 144,036.00 101,515.00

50,000,00

6,000,00

56,000.00

$

15,000,000.00 $

7,295,836,00 $

22,295,836.00

See notes to the financial statements.

- 53-

BOARDOF REGENTS OF THE UNIVERSITY SYSTEMOF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNm
ANAlYSIS OF PRIORYEAR'S SURPLUS FUNDSCOLLECTED FROMINSTITUTIONS AND REDISTRIBUTED TO INSTITUTIONS WITH DEFICITS YEARENDED JUNE30, 1998

RESEARCH UNIVERSITIES
GeorgiaInstituteof Technology GeorgiaSlale University MedicalCollegeof Georgia Universityof Georgia
REGIONAL UNIVERSITIES
GeorgiaSouihemUniversity ValdostaSlate University
STATEUNIVERSITIES/COLLEGES
AlbanySlale University Armstrong AtlanticSlate University AugustaStale University Clayton Collegeand Slale University Columbus Slale University Fort ValleySlate University GeorgiaCollegeand Slale University GeorgiaSouthwestern Slale University Kennesaw Slale University NorthGeorgiaCollegeand Slate University Savannah Slale University Southern Polytechnic Slate University Slale Universityof West Georgia
ASSOCIATE DEGREECOLLEGES
Abraham Baldwin Agricultural College AtlanlaMetropolitan College Bainbridge College CoastalGeorgiaCommunity College DaltonCollege DartonCollege DeKalbCollege East GeorgiaCollege FloydCollege Gainesville College GordonCollege MaconSlale College MiddleGeorgiaCollege SouthGeorgiaCollege WaycrossCollege
QI!::!5B.
SkidawayInstituteof Oceanography

TOTAL COLLECTED REDISTRIBUTED

CURRENT

RESIDENT INSTRUCTION

REGULAR

LOTTERYFOR EDUCATION

COLLECTED REDISTRIBUTED COLLECTED REDISTRIBUTED

$ 3,100,870.57 $

39,132.57

$

978.21 $ 3,061,738.00 $

0.00

2,139,783,16

$ 233,600.19

389,8n.92

137,885.74

4,583,35

863,928.70

296,392.05

514,457.05

45,256.92 118,989.60

132,347.28

37,813.42 118,511.14

478.46

43,361.02 24,495.92 48,532.16 40,052,40 169,529.22 70,837.70 19,276.76
7,141.66 2,655.50 22,675.21 47,364.08 3,211.65 29,021.15

14,070.26

33,842.80
21,194.56 24,285.22 13,561,68 44,906.79
9,429.61 6,310,89 2,222.30 16,454,11 47,364.08 1,083.82 16,227.41

14,070.26

9,359.18
46.79
194.99 15,409.25 7,488.71
430.75
467.82 10,268,24

4,592.19 62,678.14
8,204.39 1,299.51 21,454.88 7,735.99 76,672.98
846.83 8,962.70 18,008.67 1,048,443.10 1,352.30 10,426.23 3,956.23 13,005.12

42,202.50
1,049,879.20 18,291.92

4,592.19 62,056.95 6,199.50
342.47 21,304.88 7,735.99 76,620.36
721.83
16,461.72 1,048,443,10
7,839.43 774.19
12,640.55

42,202.50 18,291,92

1,546.95 608.81

11,888.91

$ 8,486,369,47 $ 1,295,923.73 $ 2,326,818.97 $

75,542.89 $ 3,627,078.35 $

0.00

CurrenlFunds- Unrestricted Surplus - Exhlblt.p

7,190,445,74 $ 8,486,369,47 $ _....::8l,~4;8r6.=,3:;6;9;:.4,:7..

See notes10the linancialstaJements.

-54-

SCHEDULE 15"

FUNDS

OTHERORGANIZED ACTIVITIES

REGUlAR

LOTTERYFOR EDUCATION

COllECTED REDISTRIBUTED

COLLECTED REDISTRIBUTED

P~FUNDS

REGULAR

LOTTERYFOR EDUCATION

COLLECTED REDISTRIBUTED COLLECTED REDISTRIBUTED

$

0.00 $

0.00

$

0.00

$
$ 227,322.29 43,526.36

$ 39,132.57 23,407.87 20,086.54 9,533.24

$ 1,882,n5.10 20.00

7,443.50 $

132,347.28

159.04 24,495.92 27,268.81 15,766.64 155,n2.55 10,521.66
1,nO.n 791.21 2.45
6,221.10
1,660.01 2,525.50

2.00 0.54
587.67 39.56

11,866.91

$ 282,717.56 $

38,154.36 $

0.00 $

621.19 2,004.89
957.04 150.00
52.62 125.00 8,962.70
2,586.80 3,182.04
364.57

1,049,879.20

743.49

0.00_. $ 365,566.23 $ 1,182,226.48 $ 1,864,166.36 $

0.00_

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

BOARD OF REGENTS OF THE UNIVERSITY SYSTEMOF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1998

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

472-96-03 FS 472-97-01

FurtherAction Not Warranted Previously ReportedCorrective Action Implemented

PRIOR YEAR FEDERALAWARD FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FA 472-97-01

Previously ReportedCorrective Action Implemented

SECTION ill CURRENT YEAR FINDINGS AND QUESTIONED COSTS

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1998
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
EXPENDITURESILIABILITIESIDISBURSEMENTS Failure to Monitor Controls Over Expenditures Processed by a Service Organization Finding Control Number: FS-472-98:'01
For the year under review, a statistical sample of three hundred seventeen (317) health benefit claims representing $1,620,965.34 out of a total population of $139,684,905.80 was selected to determine if the claims were properly calculated and paid to eligible employees. These claims were processed on behalf of the Administrative Central Office by Blue Cross/Blue Shield of Georgia. Our examination revealed the following errors:
(1) One (1) employee was underpaid by $3,236.40 due to errors made in coordination of benefit payments with an automobile insurance company.
(2) Two (2) employees received duplicate payments totaling $387.25 due to the failure ofthe processing system to detect duplicate drug claims.
(3) One (1) employee was overpaid by $64.00 due to a system error in which a claim was paid under the wrong service category.
(4) One (1) employee was overpaid by $34.83 due to errors made in coordination of benefit payments with Medicare.
(5) One (1) employee was overpaid by $24.50 due to errors made in coding the portion of a claim for anesthesia services.
In addition to the items noted during the sample, other procedures disclosed eleven (11) instances where the
portions ofclaims paid by employees during the calendar year exceeded the "out-of-pocket" limits they should have paid.
The Board ofRegents has an Administrative Services Agreement with Blue Cross/Blue Shield which requires a claims financial accuracy rate of 97%, allowing for a 3% financial error rate on claims processed. Ifthe 3% error rate is exceeded, the agreement allows the Board of Regents a credit on administrative fees charged by Blue Cross/Blue Shield. Based on the six (6) errors noted above, a statistically projected error rate of2.14% exists. These errors in combination with the eleven (11) errors noted during other testing procedures indicate potential system errors or control weaknesses which merit review by the Administrative Central Office. The Administrative Central Office should establish procedures to verify the accuracy of claims processed.
- 1-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA
ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID
SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEARENDED JUNE 3D. 1998
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXEDASSETSIPROPERTY MANAGEMENT Inadequacies in OperationofProperty Management System FindingControlNumber: FS-472-98-02 An equipmentinventory sampleof one hundredninetyeight (198)randomly selecteditems was utilizedto test the accuracy and validity of the Administrative Central Office's equipment inventory records. One hundred (100) itemslocated at the Administrative Central Officewere selectedfor testing along with ninety eight(98)itemsfromvarious satellite locations throughout the state. No exceptions werenotedon equipment itemstested at the Administrative Central Office; however, the following deficiencies were noted on items tested at satellite locations:
(1) At one location, five (5) itemscould notbe located and one (1) item which was identifiedas being transferred to anotherentitycouldnot be properly documented.
(2) At a second location, one (1) itemcould not be located and six (6) itemswerelocated which had no identifying decal numbers.
Thesedeficiencies occurred because of management's failure to ensure thatequipment inventory records were properly maintained at satellitelocations. The Administrative Central Office should establish appropriate procedures to strengtheninternal accounting controls and to ensurethat assets are safeguarded againstloss from unauthorized use or disposition.
-2-