Board of Regents of the University System of Georgia, Administrative Central Office (Oversight Unit), report on audit of the financial statements for the fiscal year ended June 30, 2003

STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT)
REPORT ON AUDIT OF THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2003
Russell W. Hinton State Auditor

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

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S COMBINED REPORT ON BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

REQUIRED SUPPLEMENTARY INFORMATION

MANAGEMENT'S DISCUSSION AND ANALYSIS

BASIC FINANCIAL STATEMENTS

EXHIBITS

A STATEMENT OF NET ASSETS

3

B STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS

4

C STATEMENT OF CASH FLOWS

5

D NOTES TO THE FINANCIAL STATEMENTS

7

SUPPLEMENTARY INFORMATION

SCHEDULES

SCHEDULES OF REVENUES AND EXPENDITURES COMPARED TO

BUDGET - (NON-GAAP BASIS)

1

RESIDENT INSTRUCTION

29

2

REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES 30

3

LOTTERY FOR EDUCATION

31

SCHEDULES OF APPROVED BUDGET

4

RESIDENT INSTRUCTION

32

5

REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES

34

6

LOTTERY FOR EDUCATION

36

SCHEDULES OF BUDGET TRANSFERS TO OTHER UNITS

7

RESIDENT INSTRUCTION

38

8

REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES

42

9

LOTTERY FOR EDUCATION

44

SCHEDULES OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM

OF GEORGIA

10

RESIDENT INSTRUCTION

46

11

REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES 48

12

LOTTERY FOR EDUCATION

49

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE {OVERSIGHT UNIT)
- TABLE OF CONTENTS -

SECTION I

FINANCIAL

SCHEDULES

13 ANALYSIS OF PRIOR YEAR'S SURPLUS FUNDS COLLECTED FROM

INSTITUTIONS AND REDISTRIBUTED TO INSTITUTIONS WITH

DEFICITS

50

14 RECONCILIATION OF SALARIES AND TRAVEL

52

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

SECTION I FINANCIAL

RUSSELL W. HINTON
STATE AUDITOR (404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W. Suite 214 Atlanta, Georgia 30334-8400
October 31, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly of Georgia Members of the Board of Regents of the University System of Georgia
and Honorable Thomas C. Meredith, Chancellor
INDEPENDENT AUDITOR'S COMBINED REPORT ON BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
Ladies and Gentlemen:
We have audited the accompanying basic financial statements (Exhibits A through D) of the Administrative Central Office (Oversight Unit) ofthe Board ofRegents ofthe University System of Georgia as ofand for the year ended June 30, 2003. These financial statements are the responsibility of the Administrative Central Office's management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America. 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.
As discussed in Note 1, the financial statements ofthe Administrative Central Office are intended to present the financial position and changes in financial position and cash flows ofonly that portion of the business-type activities of the State of Georgia that is attributable to the transactions of the Administrative Central Office. They do not purport to, and do not, present fairly the financial position and changes in financial position and cash flows ofthe State ofGeorgia, in conformity with accounting principles generally accepted in the United States of America.

03ARL-61

In our opinion, the basic financial statements referred to above present fairly, in all material respects, the financial position of the Administrative Central Office as of June 30, 2003, and its changes in financial position and cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.
Management's Discussion and Analysis is not a required part ofthe basic financial statements but is supplementary information required by accounting principles generally accepted in the United States ofAmerica. We have applied certain limited procedures, which consisted principally ofinquiries of management regarding the methods of measurement and presentation of this supplementary information. However, we did not audit this information and express no opinion on it.
Our audit was conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplementary information (Schedules 1 through 14) is presented for purposes of additional analysis and is not a required part of the basic financial statements ofthe Administrative Central Office. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, based on our audit, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.
Respectfully submitted,
~...4 OJ. w.~3s.. ~sell W. Hinton State Auditor
RWH:gp 03ARL-61

REQUIRED SUPPLEMENTARY INFORMATION

Administrative Central Office
Management's Discussion and Analysis
Introduction
The Administrative Central Office of Georgia's Board of Regents was created in 1931 as a part of a reorganization of Georgia's state government. With this act, public higher education in Georgia was unified for the first time under a single governing and management authority. The governor appoints members to the Board, who each serve seven years. Today the Board of Regents is composed of 18 members, five of whom are appointed from the state-at-large, and one from each of the 13 congressional districts. The Board elects a chancellor who serves as its chief executive officer and the chief administrative officer of the University System. The Board oversees 34 institutions: 4 research institutions, 2 regional universities, 13 state universities, 2 state colleges, and 13 two-year colleges. In addition, one marine research facility is governed by the Board. These institutions enroll more than 200,000 students and employ more than 9,000 faculty and 30,000 employees to provide teaching and related services to students and the communities in which they are located.
Overview ofthe Financial Statements and Financial Analysis
The Administrative Central Office is proud to present its financial statements for fiscal year 2003. The emphasis of discussions about these statements will be on current year data. There are three financial statements presented: the Statement of Net Assets; the Statement of Revenues, Expenses and Changes in Net Assets; and, the Statement of Cash Flows. This discussion and analysis of the Administrative Central Office's financial statements provides an overview of its financial activities for the year. Comparative data is provided for fiscal year 2002 and fiscal year 2003.
Statement ofNet Assets
The Statement of Net Assets presents the assets, liabilities, and net assets of the Administrative Central Office as of the end of the fiscal year. The Statement of Net Assets is a point of time financial statement. The purpose of the Statement of Net Assets is to present to the readers of the financial statements a fiscal snapshot of the Administrative Central Office. The Statement of Net Assets presents end-of-year data concerning Assets (current and noncurrent), Liabilities (current and noncurrent), and Net Assets (assets minus liabilities). The difference between current and noncurrent assets will be discussed in the notes to the financial statements.
From the data presented, readers of the Statement of Net Assets are able to determine the assets available to continue the operations of the Administrative Central Office. They are also able to determine how much the Administrative Central Office owes vendors.
Finally, the Statement of Net Assets provides a picture of the net assets (assets minus liabilities) and their availability for expenditure by the Administrative Central Office. Net assets are divided into three major categories. The first category, invested in capital assets, net of debt, provides the Administrative Central Office's equity in property, plant and equipment owned by
- 1-

the Administrative Central Office. The next asset category is restricted net assets, which is divided into two categories, nonexpendable and expendable. The corpus of nonexpendable restricted resources is only available for investment purposes. Expendable restricted net assets are available for expenditure by the Administrative Central Office but must be spent for purposes as determined by donors and/or external entities that have placed time or purpose restrictions on the use of the assets. The final category is unrestricted net assets. Unrestricted net assets are available to the Administrative Central Office for any lawful purpose of the Administrative Central Office.

Statement of Net Assets, Condensed (thousands of dollars)

June 30, 2003

June 30, 2002

Assets Current Assets Capital Assets, Net Other Assets

$ 208,774 15,911 3,612

$ 205,269 15,288 3,612

Total Assets

$ 228,297

$ 224,169

Liabilities Current Liabilities Noncurrent Liabilities

$ 154,824 3,426

$ 143,628 963

Total Liabilities

$ 158,250

$ 144,591

Net Assets Invested in Capital Assets, Net of Debt Restricted - Nonexpendable Restricted - Expendable Unrestricted

$

13,154

$

13,702

3,612

3,612

42,034

33,375

11,247

28,889

Total Net Assets

$

70 047

$

79 578

The total assets of the Administrative Central Office increased by $4,127,986.54. The cause for the increase is primarily due to an increase in cash and short-term investments of approximately $4 million as a result of an increase in the internal portion of the External Investment Pool and a decrease in nongovernmental grants and contracts receivable of approximately $1 million.

The total liabilities of the Administrative Central Office increased by $13,659,149.16. There are two primary activities involved in the total liability increase. An increase of approximately $21 million in funds held for others due to an increase in the External Investment Pool funds, and a decrease of approximately $9 million related to the health insurance incurred but not reported liability due to faster electronic claims processing by the vendor.

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Statement ofRevenues, Expenses and Changes in Net Assets

Changes in total net assets as presented on the Statement of Net Assets are based on the activity presented in the Statement of Revenues, Expenses and Changes in Net Assets. The purpose of the statement is to present the revenues received by the Administrative Central Office, both operating and nonoperating, and the expenses paid by the Administrative Central Office, operating and nonoperating, and any other revenues, expenses, gains and losses received or spent by the Administrative Central Office. Generally speaking operating revenues are received for providing goods and services to the various customers and constituencies of the institution. Operating expenses are those expenses paid to acquire or produce the goods and services provided in return for the operating revenues, and to carry out the mission of the institution. Nonoperating revenues are revenues received for which goods and services are not provided. For example state appropriations are nonoperating because they are provided by the Legislature to the institution without the Legislature directly receiving commensurate goods and services for those revenues.

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

June 30, 2003

June 30, 2002

Operating Revenues Operating Expenses

$ 239,404 399,937

$ 211,857 376,383

Operating Loss

$ -160,533

$ -164,526

Nonoperating Revenues and Expenses Special Items

154,510 -3,508

172,313

Increase (Decrease) in Net Assets

$_ _-.a..9""-'53'-=1

$_ _..:..,7'-'--'78"--'--7

Net Assets at Beginning of Year, as Originally Reported

$

79,578

$ 213,965

Cumulative Effect of Changes in Accounting Principle

-142,174

Net Assets at Beginning of Year Restated

$_~7-=1'-'-'79~1

Net Assets at End of Year

$====70=0==4==7

$====79~5==7='=8

The Statement of Revenues, Expenses and Changes in Net Assets as stated above reflects a decrease in the net assets at the end of the year. Some highlights of the information presented on the Statement of Revenues, Expenses and Changes in Net Assets are as follows:

- 1ll -

Revenue By Source (thousands of dollars) For The Years Ended June 30, 2003 and June 30, 2002

June 30, 2003

June 30, 2002

Operating Revenue Grants and Contracts Sales and Services of Educational Departments Other

$

6,945

149 232,310

$

1,065

70 210,722

Total Operating Revenue

$ 239,404

$ 211,857

Nonoperating Revenue State Appropriations Grants and Contracts Investment Income Other

$ 152,235 1,010 857 558

$ 162,699 8,372 652 785

Total Nonoperating Revenue

$ 154,660

$ 172,508

Special Item Gain on Disposal of Capital Assets

$

921

Total Revenues

$ 394,985

$ 384,365

Expenses (thousands of dollars) For The Years Ended June 30, 2003 and June 30, 2002

June 30, 2003

June 30, 2002

Operating Expenses Instruction Research Public Service Academic Support Student Services Institutional Support Plant Operations and Maintenance Scholarships and Fellowships Unallocated Depreciation

$

977

88

101,197

12,604

246

269,003

3,340

6,973

5 509

$

274

13

103,286

16,175

592

247,138

2

3,948

4 955

Total Operating Expenses

$ 399 937

$ 376,383

Nonoperating Expenses Interest Expense

$

150

$

194

Special Items

Georgia Emergency Management Agency -

Flood Recovery Refund

$

4 429

Total Expenses

$ 404,516

$ 376 577

- IV -

The compensation and employee benefits category increased by $3,827,457.84. The increase reflects a pay raise for the employees of the institution of approximately three percent with the associated fringe benefits. The increase also reflects an increased cost of health insurance for the employees of the Administrative Central Office. In addition, the increased cost of health insurance for the University System is the primary cause of the increase in Institutional Support expense as this is where health claims paid for all the institutions is reported.

During fiscal year 2003 the Administrative Central Office reimbursed the Georgia Emergency Management Agency $4,429,371.70 for the Federal and State flood recovery funds received for repairs and restorations made to Albany State University's campus resulting from flood damage caused by tropical storm Alberto. The funds for this reimbursement came from Albany State University, ($878,000), the Administrative Central Office fiscal year 2003 State Appropriations, ($1,089,520), and the remainder from the Administrative Central Office Property Reserves.

Statement ofCash Flows

The final statement presented by the Administrative Central Office is the Statement of Cash Flows. The Statement of Cash Flows presents detailed information about the cash activity of the Administrative Central Office during the year. The statement is divided into five parts. The first part deals with operating cash flows and shows the net cash used by the operating activities of the Administrative Central Office. The second section reflects cash flows from noncapital financing activities. This section reflects the cash received and spent for nonoperating, noninvesting, and noncapital financing purposes. The third section deals with cash flows from capital and related financing activities. This section deals with the cash used for the acquisition and construction of capital and related items. The fourth section reflects the cash flows from investing activities and shows the purchases, proceeds, and interest received from investing activities. The fifth section reconciles the net cash used to the operating income or loss reflected on the Statement of Revenues, Expenses and Changes in Net Assets.

Statement of Cash Flows for the Years Ended June 30, 2003 and June 30, 2002, Condensed (thousands of dollars)

June 30, 2003

June 30, 2002

Cash Provided (Used) By: Operating Activities Noncapital Financing Activities Capital and Related Financing Activities Investing Activities

$ -166,105 171,276 -2,630 572

$ -163,474 142,224 -5,996 11,769

Net Change in Cash
Cash - June 30, 2002 Add: Short-Term Investment Pools

$_ _-=.,3,-=--cl=-3

$

52,548

32,850

$_----=-1=--5'--'-'47'-'-7

$

68,025

Cash, Beginning of Year

$_----=8-=..,5,=.=39--=-8

$_----=6-=->8,-=-=02=-5

Cash, End of Year

$==8-8,==51==1

$====52""',5"='4='8

-v-

Capital Assets
The Administrative Central Office had one significant capital asset addition for buildings in fiscal year 2003. A residence, to be used as a home for the Chancellor of the University System of Georgia, was purchased in partnership with Georgia State University.
The total purchase price was $1,928,406.53 of which $1,200,000 is reported as Buildings, Capital Assets on the books of Georgia State University and $728,406.53 is reported as Buildings, Capital Assets on the books of the Administrative Central Office.
For additional information concerning Capital Assets, see Notes 1, 5, 7, and 8 in the notes to the financial statements.
Long-Term Debt
The Administrative Central Office had a total long-term debt of $5,974,884.36 of which $2,549,318.88 was reflected as current year liability at June 30, 2003.
For additional information concerning Long-Term Debt, see Notes 1 and 7 in the notes to the financial statements.
Health Insurance
The Administrative Central Office is also the fiscal agent for the Employee Health Benefits Plan covering participating employees of the University System of Georgia. The information regarding revenues and expense for fiscal year 2003 are listed below in thousands of dollars.

Beginning Net Assets July 1, 2002

$

16,711

Plus Revenues Fiscal Year 2003 Less Expenses Fiscal Year 2003

217,256 198,933

Ending Net Assets June 30, 2003

$====35e0ae;S3==4

Economic Outlook

The Administrative Central Office is not aware of any currently known facts, decisions, or conditions that are expected to have a significant effect on the financial position or results of operations during this fiscal year beyond those unknown variations having a global effect on virtually all types of business operations.

The Administrative Central Office's overall financial position is strong. The reduction in Net Assets for fiscal year 2003 is a direct reflection of the related reduction in State Appropriations. Due to these reductions no new programs were added during the year and planned expansions of some programs were cancelled or postponed.

- Vl -

Constant monitoring of resources and mission critical needs will continue through the year in order to maintain the office's ability to react and respond to unknown internal and external factors. William R. Bowes, Vice Chancellor for Fiscal Affairs/Treasurer The Board of Regents Administrative Central Office
- vu -

BASIC FINANCIAL STATEMENTS - 1-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) STATEMENT OF NET ASSETS JUNE 30. 2003

EXHIBIT"A"

ASSETS
Current Assets Cash and Cash Equivalents Investments Accounts Receivable, Net State Appropriations Federal Financial Assistance Other Prepaid Items
Total Current Assets
Noncurrent Assets Investments Capital Assets, Net (See Note 5)
Total Noncurrent Assets
Total Assets
LIABILITIES
Current Liabilities Accounts Payable Benefits Payable Deferred Revenue Funds Held for Others Capital Leases Compensated Absences
Total Current Liabilities
Noncurrent Liabilities Capital Leases Compensated Absences
Total Noncurrent Liabilities
Total Liabilities
NET ASSETS
Invested in Capital Assets, Net of Related Debt Restricted for:
Non expendable Expendable Unrestricted
Total Net Assets

$ 88,511,285.28
118,276,471.48
149,999.00 1,667,473.10
167,266.76 2 034.00
$ 208,774,529.62

$

3,612,043.20

15,910,302.19

$ 19,522,345.39

$ 228,296,875.01

$

323,165.31

20,556,347.55

944,569.38

130,450,747.81

1,162,745.11

1,386,573.78

$ 154,824,148.94

$

2,595,513.34

830,052.13

$

3 425,565.47

$ 158,249,714.41

$ 13,154,370.18
3,612,043.20 42,034,131.88 11,246,615.34

$ 70,047,160.60

The notes to the financial statements are an integral part of this statement. -3-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT)
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS YEAR ENDED JUNE 30, 2003

EXHIBIT"B"

OPERATING REVENUES
Grants and Contracts Federal State Nongovernmental
Sales and Services of Educational Departments Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES
Salaries Staff
Employee Benefits Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES)
State Appropriations Grants and Contracts
Federal Nongovernmental Interest and Other Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues
Income (Loss) Before Other Revenues, Expenses, Gains or Losses
Special Items Gain on Disposal of Capital Assets Georgia Emergency Management Agency - Flood Recovery Refund
Total Other Revenues (Expenses)
Increase (Decrease) in Net Assets
Net Assets Net Assets - Beginning of Year, as Originally Reported
Net Assets - End of Year
The notes to the financial statements are an integral part of this statement. -4-

$

6,547,060.71

217,690.75

180,869.29

148,753.31

232,310,365.15

$ 239,404,739.21

$

20,356,190.92

4,849,627.39

546,839.87

6,973,325.53

26,185,684.00

335,516,767.64

5,509,163.57

$ 399,937,598.92

$ -160,532,859.71

$ 152,234,803.58

39,853.27 970,230.31 857,156.91 -149,777.54 557,703.26

$ 154,509,969.79

$

-6,022,889.92

$

921,099.00

-4,429,371.70

$

-3,508,272. 70

$

-9,531, 162.62

79,578,323.22

$ ======7=-0,=04=7=,1=6=0=.6=0

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE /OVERSIGHT UNIT) STATEMENT OF CASH FLOWS YEAR ENDED JUNE 30 2003

EXHIBIT"C"

CASH FLOWS FROM OPERATING ACTIVITIES Grants and Contracts Sales and Services of Educational Departments Payments to Suppliers Payments to Employees Payments for Scholarships and Fellowships Other Receipts (Payments)
Net Cash Provided (Used) by Operating Activities
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES State Appropriations Agency Funds Transactions Gifts and Grants Received for Other than Capital Purposes Other Nonoperating Receipts Georgia Emergency Management Agency Flood Recovery Refund
Net Cash Flows Provided (Used) by Noncapital Financing Activities
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Proceeds from Capital Debt Proceeds from Sale of Capital Assets Purchases of Capital Assets Principal Paid on Capital Debt and Lease Interest Paid on Capital Debt and Lease
Net Cash Provided (Used) by Capital and Related Financing Activities
CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from Sales and Maturities of Investments Interest on Investments Purchase of Investments
Net Cash Provided (Used) by Investing Activities
Net Increase (Decrease) in Cash
Cash and Cash Equivalents - June 30, 2002 Add: Short-Term Investments Pools
Cash and Cash Equivalents - Beginning of Year

$

6,213,183.16

148,753.31

-377, 770,302.88

-20,033,272. 79

-6,973,325.53

232,310,365.15

$ -166, 104,599.58

$ 152,195,803.58 20,613,434.20 1,997,506.43 898,748.61 -4,429 371. 70
$ 171,276,121.12

$

1,042,628.28

1,011,099.00

-2,328, 183.98

-2,206, 173.41

-149 777.54

$

-2,630,407.65

$

693,330.56

857,156.91

-978 471.10

$

572 016.37

$

3,113,130.26

$ 52,548,011.70 32,850,143.32

$ 85,398,155.02

Cash and Cash Equivalents - End of Year

$ 88,511,285.28

RECONCILIATION OF OPERATING LOSS TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
Operating Income (Loss) Adjustments to Reconcile Net Income (Loss) to Net Cash
Provided (Used) by Operating Activities Depreciation Change in Assets and Liabilities: Accounts Receivable, Net Prepaid Items Accounts Payable Benefits Payable Deferred Revenue Compensated Absences

$ -160,532,859. 71
5,509,163.57
-1,674,946.97 3,344.50
-1,955,177.72 -8,721,610.76
944,569.38 322,918.13

Net Cash Provided (Used) by Operating Activities

$ -166, 104,599.58

NONCASH ACTIVITY NONCASH INVESTING, NONCAPITAL FINANCING, AND CAPITAL AND RELATED FINANCING TRANSACTIONS Fixed Assets Acquired by Incurring Capital Lease Obligation

$ ==4.....,37..,8..,,5.,.0.7..,..1...,2

The notes to the financial statements are an integral part of this statement. -5-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATNE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS The Administrative Central Office of the Board of Regents of the University System of Georgia is the "Oversight Unit" of the Board of Regents and performs administrative functions and provides guidance to the thirty-four (34) State colleges and universities and Skidaway Institute of Oceanography which are organizational units of the Board of Regents of the University System of Georgia.
REPORTING ENTITY The Board of Regents of the University System of Georgia, an organizational unit of the State of Georgia, was created by the "Reorganization Act of 1931 ". As of June 30, 2003, 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, 2 state colleges and 13 two-year colleges), Skidaway Institute of Oceanography and an administrative central office, which is the oversight unit, responsible for implementation of Board policies and administrative support. The Board of Regents is composed of eighteen members appointed by the Governor and confirmed by the Senate. 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 has constitutional authority to govern, control and manage the University System of Georgia. This authority includes but is not limited to the power to designate management, the ability to significantly influence operations, the authority to control institutions' budgets, the power to determine allotments of State funds to member institutions and the authority to prescribe accounting systems and administrative policies for member institutions. The Board of Regents does not have authority to retain unexpended State appropriations (surplus) for any given fiscal year. Accordingly, the Board of Regents is considered an organizational unit of the Board of Regents of the University System of Georgia reporting entity for financial reporting purposes because of the significance of its legal, operational, and financial relationships with the Board of Regents as defined in Section 2100 of the Governmental Accounting Standards Board (GASB) Codification of Governmental Accounting and Financial Reporting Standards.
FINANCIAL STATEMENT PRESENTATION In June 1999, the GASB issued Statement No. 34, Basic Financial Statements and Management Discussion and Analysis for State and Local Governments. This was followed in November 1999 by GASB Statement No. 35, Basic Financial Statements and Management's Discussion and Analysis for Public Colleges and Universities. The State of Georgia was required to implement GASB Statement No. 34 as of and for the year ended June 30, 2002. As an organizational unit of the State of Georgia, the Administrative Central Office is also required to adopt GASB Statements No. 34 and No. 35 as amended by GASB Statements No. 37 and No. 38. The financial statement presentation required by GASB Statements No. 34 and No. 35 as
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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT} NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
FINANCIAL STATEMENT PRESENTATION amended by GASB Statements No. 37 and No. 38 provides a comprehensive, entity-wide perspective of the Administrative Central Office's assets, liabilities, net assets, revenues, expenses, changes in net assets, cash flows, and replaces the fund group perspective previously required.
BASIS OF ACCOUNTING For financial reporting purposes, the Administrative Central Office is considered a specialpurpose government engaged only in business-type activities. Accordingly, the Administrative Central Office's financial statements have been presented using the economic resources measurement focus and the accrual basis of accounting, except as noted in the preceding paragraph. Under the accrual basis, revenues are recognized when earned, and expenses are recorded when an obligation has been incurred. All significant intra-Administrative Central Office transactions have been eliminated.
The Administrative Central Office has the option to apply all Financial Accounting Standards Board (FASB) pronouncements issued after November 30, 1989, unless FASB conflicts with GASB. The Administrative Central Office has elected to not apply FASB pronouncements issued after the applicable date.
CASH AND CASH EQUIVALENTS Cash and Cash Equivalents consist of petty cash, demand deposits and time deposits in authorized financial institutions, and cash management pools that have the general characteristics of demand deposit accounts.
INVESTMENTS The Administrative Central Office accounts for its investments at fair value in accordance with GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools. Changes in unrealized gain (loss) on the carrying value of investments are reported as a component of investment income in the statements of revenues, expenses and changes in net assets.
Investments in the various investment pools maintained by the Administrative Central Office consist, in part, of repurchase agreements and certain U.S. Government Securities which include mortgage-backed securities such as collateralized mortgage obligations and adjustable rate mortgages. These mortgage-backed securities are reported as U.S. Government Securities in the disclosure note of custodial credit risk. (See Note 2 on Categorization of Investments) Investments in the investment pools are transacted by an external investment firm under direction of an investment advisory agreement executed between the Administrative Central Office and the investment management firm. As of June 30, 2003, the Administrative Central Office had $22,520,132.46 invested in U.S. Agency mortgage-backed securities.
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BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ACCOUNTS RECEIVABLE Accounts receivable consist of allotments due from the Office of Treasury and Fiscal Services, Federal, State and other receivables disclosed from information available. Accounts receivable are net of estimated uncollectible amounts.
INVENTORIES No inventories of supplies are reported in these financial statements. Expendable supplies are recorded as expenditures at the time of purchase.
NONCURRENTINVESTMENTS Investments that are externally restricted and cannot be used to pay current liabilities are classified as noncurrent assets in the statements of net assets.
CAPITAL ASSETS Capital assets are recorded at cost at the date of acquisition, or fair market value at the date of donation in the case of gifts. For equipment, the Administrative Central Office's capitalization policy includes all items with a unit cost of $5,000.00 or more, and an estimated useful life of greater than one year. Renovations to buildings, infrastructure, and land improvements that exceed $100,000.00 and significantly increase the value or extend the useful life of the structure are capitalized. Routine repairs and maintenance are charged to operating expense in the year in which the expense was incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally 40 to 60 years for buildings, 20 to 25 years for infrastructure and land improvements, 10 years for library books, and 3 to 7 years for equipment. Residual values will generally be 10% of historical costs for infrastructure, buildings and building improvements, and facilities and other improvements.
To obtain the total picture of plant additions in the University System, it is necessary to look at the activities of the Georgia State Financing and Investment Commission (GSFIC) - an organization that is external to the System. GSFIC issues bonds for and on behalf of the State of Georgia, pursuant to powers granted to it in the Constitution of the State of Georgia and the Act creating the GSFIC. The bonds so issued constitute direct and general obligations of the State of Georgia, to the payment of which the full faith, credit and taxing power of the State are pledged.
Effective July 1, 2001, the GSFIC retains construction in progress on their books throughout the construction period and transfers the entire project to the Administrative Central Office when complete.
-9-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
DEFERRED REVENUES Deferred revenues include amounts received from grant and contract sponsors that have not yet been earned.
COMPENSATED ABSENCES Employee vacation pay is accrued at year-end for financial statement purposes. The liability and expense incurred are recorded at year-end as accrued vacation payable in the Statement of Net Assets, and as a component of compensation and benefit expense in the Statements of Revenues, Expenses and Changes in Net Assets. The Administrative Central Office had accrued liability for compensated absences in the amount of $1,893,707.78 as of July 1, 2002. For fiscal year 2003, $1,665,658.70 was earned in compensated absences and employees were paid $1,342,740.57, for a net increase of $322,918.13. The ending balance as of June 30, 2003 in accrued liability for compensated absences is $2,216,625.91. Compensated absences include a current liability of $1,386,573.78.
NONCURRENT LIABILITIES Noncurrent liabilities include (1) liabilities that will not be paid within the next fiscal year; (2) capital lease obligations with contractual maturities greater than one year; and (3) other liabilities that, although payable within one year, are to be paid from funds that are classified as noncurrent assets.
NET ASSETS The Administrative Central Office's net assets are classified as follows:
Invested in capital assets, net of related debt: This represents the Administrative Central Office's total investment in capital assets, net of outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of invested in capital assets, net of related debt.
Restricted net assets - nonexpendable: Nonexpendable restricted net assets consist of endowment and similar type funds in which donors or other outside sources have stipulated, as a condition of the gift instrument, that the principal is to be maintained inviolate and in perpetuity, and invested for the purpose of producing present and future income, which may either be expended or added to principal. The Administrative Central Office may accumulate as much of the annual net income of an institutional fund as is prudent under the standard established by Code Section 44-15-7 of Annotated Code of Georgia.
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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NET ASSETS Restricted net assets - expendable: Restricted expendable net assets include resources in which the Administrative Central Office is legally or contractually obligated to spend resources in accordance with restrictions imposed by external third parties.

Unrestricted net assets: Unrestricted net assets represent resources derived from state appropriations and sales and services of educational departments. These resources are used for transactions relating to the educational and general operations of the Administrative Central Office, and may be used at the discretion of the governing board to meet current expenses for those purposes, except for unexpended state appropriations (surplus) of $113,982.28. Unexpended state appropriations must be refunded to the Office of Treasury and Fiscal Services.

Unrestricted Net Assets includes the following items which are quasi-restricted by management.

June 30, 2003

Reserve for Encumbrances Other Unrestricted

$12,919,800.16 -1,673,184.82

Total Unrestricted Net Assets

$11.246.615.34

When an expense is incurred that can be paid using either restricted or unrestricted resources, the Administrative Central Office's policy is to first apply the expense towards unrestricted resources, and then towards restricted resources.

INCOME TAXES The Administrative Central Office, as a political subdivision of the State of Georgia, is excluded from Federal income taxes under Section 115(1) of the Internal Revenue Code, as amended.

CLASSIFICATION OF REVENUES The Administrative Central Office has classified its revenues as either operating or nonoperating revenues in the Statement of Revenues, Expenses and Changes in Net Assets according to the following criteria:

Operating revenues: Operating revenues include activities that have the characteristics of exchange transactions, such as (1) sales and services of Educational Departments and (2) Federal, state and local grants and contracts.

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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CLASSIFICATION OF REVENUES Nonoperating revenues: Nonoperating revenues include activities that have the characteristics of nonexchange transactions, such as gifts and contributions, and other revenue sources that are defined as nonoperating revenues by GASB No. 9, Reporting Cash Flows of Proprietary and Nonexpendable Trust Funds and Governmental Entities That Use Proprietary Fund Accounting, and GASB No. 34, such as state appropriations and investment income.
NOTE 2: CASH AND CASH EQUIVALENTS; OTHER DEPOSITS; AND INVESTMENTS
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds belonging to the State of Georgia (and thus the Administrative Central Office) cannot be placed in a depository paying interest longer than ten days without the depository providing a surety bond to the State. In lieu of a surety bond, the depository may pledge as collateral any one or more of the following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59:
1. Bonds, bill, 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 of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose.
4. Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia.
5. Bonds, bills, certificates of indebtedness, notes, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest, 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.
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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 2: CASH AND CASH EQUIVALENTS; OTHER DEPOSITS; AND INVESTMENTS

STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES As authorized in the Official Code of Georgia Annotated Section 50-17-53, the State Depository Board has adopted policies which allow agencies of the State of Georgia (and thus the Administrative Central Office), the option of exempting demand deposits from the collateral requirements.

The Treasurer of the Board of Regents is responsible for all details relative to furnishing the required depository protection for all units of the University System of Georgia.

CATEGORIZATION OF DEPOSITS The Administrative Central Office's cash deposits are categorized by risk as follows:

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 financial 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 as of June 30, 2003 are as follows:

Carrying Amount

Bank Balances

Risk Categories

2

3

Cash Deposits Investment Portfolio
Accounts
Total Cash Deposits

$40,762,194.45 $32,204,488.20 30,269,649.22 30,269,649.22 $71,031 843 67 $62 474.137.42

$ 100,000.00 $

0.00 $32,104,488.20

30,269,649.22
$30.369.649.22 $=====o...,o,,,.o $32.104 488 20

CATEGORIZATION OF INVESTMENTS The Administrative Central Office's investments are categorized as to 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.

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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 2003

NOTE 2: CASH AND CASH EQUIVALENTS; OTHER DEPOSITS; AND INVESTMENTS

CATEGORIZATION OF INVESTMENTS Category 2 - Uninsured and unregistered, with securities held by the counter party's trust
department or agent in the Administrative Central Office's name.

Category 3 - Uninsured and unregistered, with securities held by the counter party, 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, 2003, consisted solely of an external investment pool. (See Note 3) The following is a risk categorization of the pooled investments of the Administrative Central Office's "mixed" external investment pool, as of June 30, 2003:

T:me of Investments
Common Stock Corporate Bonds Repurchase Agreements U. S. Government Securities
Total Investments

Risk Categories

2

3

Carrying Amount

$

0.00 $

0.00 $ 56,917,368.65 $ 56,917,368.65

15,074,924.60 15,074,924.60

5,456,000.00 5,456,000.00

61,919,663.04 61,919,663.04

$

QQQ $

Q,QQ $132,362 256.22 $132 362256 22

NOTE 3: EXTERNAL INVESTMENT POOL

The Administrative Central Office serves as fiscal agent for various units of the University System of Georgia and cooperative organizations. The Administrative Central Office pools the monies of these 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 pool portions. The investment pool is not registered with the SEC as an investment company. The fair value of investments is determined daily. The pool does not issue shares. Each participant is allocated a pro rata share of each investment at fair value along with a pro rata share of the interest that it earns. Condensed financial information for the investment pool follows:

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BOARD OF REGENTS OF THE UNNERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATNE CENTRAL OFFICE {OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 3: EXTERNAL INVESTMENT POOL

Statement of Net Assets - June 30, 2003

Assets

Cash Investments Interest Receivable

$ 1,889,884.66 139,367,956.29 704,689.61

$141,962,530.56

Net Assets Held in Trust for Pool Participants

Internal Portion External Portion

$ 11,869,957.22 130,092,573.34

$141,962.530.56

Statement of Changes in Net Assets - Year Ended June 30, 2003

Revenues

Interest Income Net Increase (Decrease) in Fair Value oflnvestments

$ 3,701,869.22 -755,695.65

Total Revenues

$ 2,946,173.57

Expenses

Operating Expenses Administrative Expenses

368,598.22

Net Increase (Decrease) in Assets Resulting from Operations

$ 2,577,575.35

Distribution to Participants Capital Transactions

-15,292,840.39 28,413,299.15

Total Increase (Decrease) in Net Assets

$ 15,698,034.11

Net Assets July 1, 2002

126,264,496.45

Net Assets June 30, 2003

$141,962,530.56

NOTE 4: ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following at June 30, 2003.

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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 4: ACCOUNTS RECEIVABLE

State Appropriations Other Operating Activities Federal and Private Funds Other

$ 149,999.00 56,462.77
1,766,163.53 14,173.56

Less Allowance for Doubtful Accounts

$ 1,986,798.86 2,060.00

Net Accounts Receivable

$ 1,984,738.86

NOTE 5: CAPITAL ASSETS

Following are the changes in capital assets for the year ended June 30, 2003:

Beginning Balance July I, 2002

Additions

Reductions

Ending Balance June 30, 2003

Capital Assets, Not Being Depreciated:

Land

$ 2,501,877.00

Capitalized Collections

10 000.00

$ 90,000.00 $ 2,411,877.00 10,000.00

Total Capital Assets Not Being Depreciated

$ 2,511,877.00

$ 90 000.00 $ 2,421,877.00

Capital Assets, Being Depreciated: Building and Building Improvements Equipment Capital Leases

$

0.00 $

21,985,482.73

5,241,896.16

728,406.53 1,599,777.45 $ 4,378,507.12

$ 728,406.53 2,260,499.76 21,324,760.42
18,242.85 9,602,160.43

Total Assets Being Depreciated

$ 27,227,378.89 $ 6,706,691.10 $ 2,278,742.61 $ 31,655,327.38

Less: Accumulated Depreciation: Equipment Capital Leases

$ 11,807,710.76 $ 3,860,045.43 $ 1,793,817.59 $ 13,873,938.60

2,643,845.45 1,649,118.14

4,292,963.59

Total Accumulated Depreciation

$ 14,451,556.21 $ 5,509,163.57 $ 1,793,817.59 $ 18,166,902.19

Total Capital Assets, Being Depreciated,

Net

$ 12,775,822.68 $ 1,197,527.53 $ 484,925.02 $ 13,488,425.19

Capital Assets, Net

$ 15.287.699.68 $ 1.197,527.53 $ 574,925.02 $ 15 910 302.19

NOTE 6: DEFERRED REVENUE

Deferred revenue consists of the following at June 30, 2003.

Other Deferred Revenue

$ 944,569.38

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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 7: LONG-TERM LIABILITIES

Long-Term liability activity for the year ended June 30, 2003 was as follows:

Beginning Balance July 1, 2002

Additions

Reductions

Ending Balance June 30, 2003

Current Portion

Leases Lease Obligations

$ 1,585,924.74 $ 4,407,470.08 $ 2,235,136.37 $ 3,758,258.45 $ 1,162,745.11

Other Liabilities Compensated Absences

1,893,707.78

1,665,658.70

1,342,740.57

2,216,625.91

1,386.573. 78

Total Long-Term Obligations $ 3,479 632 52 $ 6 073.128 78 $ 3 577.876 94 $ 5,974,884.36 $ 2 549 318 89

NOTE8: LEASE OBLIGATIONS

The Administrative Central Office is obligated under various operating leases for the use of real property (land, buildings, and office facilities) and equipment, and also is obligated under capital leases for the acquisition of real property and equipment.

CAPITAL LEASES Capital leases are generally payable in installments ranging from monthly to annually and have terms expiring in various years between 2004 and 2007. Expenses for fiscal year 2003 were $2,384,913.91 of which $149,777.54 represented interest. Total principal paid on capital leases was $2,235,136.37 for the fiscal year ended June 30, 2003. Interest rates range from 3.66 percent to 7.73 percent. The following is a summary of the carrying values of assets held under capital lease at June 30, 2003:

Equipment

$ 5.309.196.84

Certain capital leases provide for renewal and/or purchase options. Generally purchase options at bargain prices of one dollar are exercisable at the expiration of the lease terms.

OPERATING LEASES The Administrative Central Office has entered into an agreement to lease real property which is classified as an operating lease (leases on assets not recorded on the balance sheet). This lease contains provisions that, at the expiration date of the original term of the lease, the Administrative Central Office has the option of renewing the lease on a year-to-year basis. Future minimum lease payments for the operating lease as of June 30, 2003, is listed below. Amounts are included only for the cancellable lease for which an option to renew for the subsequent fiscal year has been exercised.

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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 8: LEASE OBLIGATIONS

OPERATING LEASES Expenses for agreements to lease real property under operating leases for the year ended June 30, 2003, totaled $436,740.00.

Future commitments for capital leases (which here and on the Statement of Net Assets include other installment purchase agreements) and for the operating lease having remaining terms in excess of one year as of June 30, 2003, were as follows:

Year Ending June 30: 2004 2005 2006 2007
Total Minimum Lease Payments
Less: Interest
Principal Outstanding

Capital Leases

Operating Lease

$ 1,283,781.20 $ 436,740.00 1,237,220.92 1,115,819.69 359,365.10
$3,996,186.91 $ 436,740.00
237,928.46
$3,758,258.45

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 cost-sharing multiple-employer defined benefit pension plan established by the General Assembly of Georgia for the purpose of providing 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 Georgia Department 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% of their 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 2003, the employer contribution rate was 9.24% for covered employees. Employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 9: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA

Funding Policy

Fiscal Year
2003 2002 2001

Percentage Contributed
100% 100% 100%

Required Contribution
$ 1,527,821.81 $ 1,303,166.33 $ 1,388,030.80

EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

Plan Description The Administrative Central Office participates in the Employees' Retirement System of Georgia (ERS), a single-employer defined benefit pension plan established by the General Assembly of Georgia for the purpose of providing retirement allowances for employees of the State of Georgia.

The benefit structure of ERS is defined by State statute and was significantly modified on July 1, 1982. Unless elected otherwise, an employee who currently maintains membership with ERS based upon State employment that started prior to July 1, 1982, is an "old plan" member subject to the plan provisions in effect prior to July 1, 1982. All other members are "new plan" members subject to the modified plan provisions.

Under both the old plan and new plan, members become vested after 10 years of creditable service. A member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 65. If 10 years of service is completed and age 60 is reached, the member may retire with a reduced benefit. Additionally, there are certain provisions allowing for retirement after 25 years of service regardless of age.

Retirement benefits paid to members are based upon a formula which considers the monthly average of the member's highest twenty-four consecutive calendar months of salary, the number of years of creditable service, and the member's age at retirement. Postretirement cost-of-living adjustments are also made to member's benefits. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension at reduced rates to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS.

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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE {OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 9: RETIREMENT PLANS
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA
Plan Description In addition, the ERS Board of Trustees created the Supplemental Retirement Benefit Plan (SRBP) effective January 1, 1998. The SRBP was established as a qualified governmental excess benefit plan in accordance with Section 415 of the Internal Revenue Code (IRC) as a portion ofERS. The purpose of SRBP is to provide retirement benefits to employees covered by ERS whose benefits are otherwise limited by IRC 415.
The ERS issues a financial report each fiscal year which may be obtained through ERS.
Funding Policy As established by State statute, all full-time employees of the State of Georgia and its political subdivisions, who are not members of other state retirement systems, are eligible to participate in the ERS. Both employer and employee contributions are established by State statute. The Administrative Central Office's payroll for the year ended June 30, 2003, for employees covered by ERS was $555,954.46. The Administrative Central Office's total payroll for all employees was $20,356,190.92.
Under the old plan, member contributions consist of 7.41 % of annual compensation. Of these member contributions, the employee pays the first 1.5% and the Administrative Central Office pays the remainder on behalf of the employee. Under the new plan, member contributions consist solely of 1.5% of annual compensation paid by employee. The Administrative Central Office also is required to contribute at a specified percentage of active member payroll determined annually by actuarial valuation. For the year ended June 30, 2003, the ERS employer contribution rate for the Administrative Central Office amounted to 10.36% of covered payroll and included the amounts contributed on behalf of the employee under the old plan referred to above. Employer contributions are also made on amounts paid for accumulated leave to retiring employees.
Total contributions to the plan made during fiscal year 2003 amounted to $64,544.72 of which $57,595.44 was made by the Administrative Central Office and $6,949.28 was made by employees. These contributions met the requirements of the plan.
Actuarial and Trend Information Actuarial and historical trend information is presented in the ERS June 30, 2003, financial report which may be obtained through ERS.
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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 9: RETIREMENT PLANS
REGENTS RETIREMENT PLAN
Plan Description The Regents Retirement Plan, a single-employer defined contribution plan, is an optional retirement plan that was created/established by the Georgia General Assembly in O.C.G.A. 4721-1 et. seq. and is administered by the Board of Regents of the University System of Georgia. Under this plan, the Board of Regents may purchase annuity contracts for the purpose of providing 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 with the terms of the annuity contracts.
Funding Policy The Administrative Central Office makes monthly employer contributions for the Regents Retirement Plan at rates adopted by the Teachers Retirement System of Georgia Board of Trustees in accordance with State Statute and as advised by their independent actuary. The employer contributes 10.02% of the participating employee's eamable compensation. Employees contribute 5% of their eamable compensation. Amounts attributable to all plan contributions are fully vested and nonforfeitable at all times.
The Administrative Central Office and the covered employees made the required contributions of $247,184.31 (10.02%) and $123,344.95 (5%), respectively.
GEORGIA DEFINED CONTRIBUTION PLAN
Plan Description The Administrative Central Office participates in the Georgia Defined Contribution Plan (GDCP) which is a single-employer defined contribution plan established by the General Assembly of Georgia for the purpose of providing retirement coverage for State employees who are temporary, seasonal, and part-time and are not members of a public retirement or pension system. GDCP is administered by the Board of Trustees of the Employees' Retirement System of Georgia.
Benefits A member may retire and elect to receive periodic payments after attainment of age 65. The payment will be based upon mortality tables and interest assumptions to be adopted by the Board of Trustees. If a member has less than $ 3,500.00 credited to his/her account, the Board of Trustees has the option of requiring a lump sum distribution to the member in lieu of making periodic payments. Upon the death of a member, a lump sum distribution equaling the amount credited to his/her account will be paid to the member's designated beneficiary. Benefit provisions are established by State statute.
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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 9: RETIREMENT PLANS
GEORGIA DEFINED CONTRIBUTION PLAN
Contributions and Vesting Member contributions are seven and one-half percent (7.5%) of gross salary. There are no employer contributions. Contribution rates are established by State statute. Earnings are credited to each member's account in a manner established by the Board of Trustees. Upon termination of employment, the amount of the member's account is refundable upon request by the member.
Total contributions made by employees during fiscal year 2003 amounted to $19,566.59 which represents 7.5% of covered payroll. These contributions met the requirements of the plan.
NOTE 10: RISK MANAGEMENT
The Board of Regents of the University System of Georgia maintains a self-insured program of health and dental benefits for its employees and retirees. This plan is funded jointly through premiums paid by participants covered under the plan and employer contributions paid by the Board of Regents and its organizational units. All units of the University System of Georgia share the risk of loss for claims of the Employee Health Benefits Plan. Participants are covered up to a maximum lifetime benefit of $2,000,000.00 per person and dental coverage up to an annual maximum of $1,000.00 per person.
The Board of Regents has contracted with Blue Cross - Blue Shield to process all medical and dental claims in accordance with medical coverage guidelines as established by the Board of Regents. All claims submitted by program participants are remitted directly to Blue Cross - Blue Shield from the various organizational units for verification of coverage, processing, and payment through a bank account maintained for this purpose by Blue Cross - Blue Shield. Blue Cross - Blue Shield maintains an eligibility file based on information furnished by the various organizational units of the University System of Georgia.
Express Scripts is the administrator of the Board of Regents' prescription drug plan. Pharmacy drug claims will be processed in accordance with guidelines established for the Board of Regents' Prescription Drug Benefit Program. Generally, claims are submitted by participating pharmacies directly to Express Scripts for verification, processing and payment. Express Scripts maintains an eligibility file based on information furnished by Blue Cross - Blue Shield on behalf of the various organizational units of the University System of Georgia.
A reconciliation of total estimated claims liabilities for the fiscal year ended June 30, 2003, is shown below:
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BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 10: RISK MANAGEMENT

Unpaid Claims and Claim Adjustments July 1, 2002

$ 29,277,958.31

Incurred Claims and Claim Adjustments Expenses - Provisions for Insured Events of the Current Year

179,559,291.69

Payments - Claims and Claim Adjustments Attributable to Insured Events of the Current Year and of Prior Years

188,280,902.45

Unpaid Claims and Claim Adjustments June 30, 2003

$ 20,556,347.55

The Department of Administrative Services (DOAS) has the responsibility for the State of Georgia of making and carrying out decisions that will minimize the adverse effects of accidental losses that involve State government assets. The State believes it is more economical to manage its risks internally and set aside assets for claim settlement. Accordingly, DOAS processes claims for risk of loss to which the State is exposed, including general liability, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' indemnification. Limited amounts of commercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks. The Administrative Central Office, as an organizational unit of the Board of Regents of the University System of Georgia, is part of the State of Georgia reporting entity, and as such, is covered by the State of Georgia risk management program administered by DOAS. Premiums for the risk management program are charged to the various state organizations by DOAS to provide claims servicing and claims payment.

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 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 of Regents expects such amounts, if any, to be immaterial to its overall financial position.

- 23 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003
NOTE 11: CONTINGENCIES Litigation, claims and assessments filed against the Administrative Central Office (an organizational unit of the Board of Regents of the University System of Georgia), if any, are generally considered to be actions against the State of Georgia. Accordingly, significant litigation, claims and assessments pending against the State of Georgia are disclosed in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 2003. NOTE 12: POST-EMPLOYMENT BENEFITS OTHER THAN PENSION BENEFITS Pursuant to the general powers conferred by the Official Code of Georgia Annotated Section 203-31, the Board of Regents of the University System of Georgia has established group health and life insurance programs for regular employees of the University System of Georgia. It is the policy of the Board of Regents to permit employees of the University System of Georgia eligible for retirement or that become permanently and totally disabled to continue as members of the group health and life insurance programs. The policies of the Board of Regents of the University System of Georgia define and delineate who is eligible for these post-employment 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, 2003, there were 61 employees who had retired or were disabled that were receiving these post-employment health and life insurance benefits. For the year ended June 30, 2003, the Administrative Central Office recognized as incurred $198,862.13 of expenses, which was net of $93,129.88 of participant contributions.
- 24-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA EXHIBIT "D" ADMINISTRATIVE CENTRAL OFFICE {OVERSIGHT UNIT) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2003

NOTE 13: NATURAL CLASSIFICATIONS WITH FUNCTIONAL CLASSIFICATIONS

The Administrative Central Office's operating expenses by functional classification are shown below:

Statement of Operating Expenses - Natural vs Functional Classifications For the Fiscal Year Ended June 30, 2003

Functional Classification

Natural Classification

Instruction

Research

Public Service

Academic Su1mort

Student Services

Salaries Staff
Employee Benefits Travel Scholarships and
Fellowships Utilities Supplies and Other
Services Depreciation

$ 378,069.51 $ 55,854.18 $ 1,483,839.60 $ 1,143,648.01 $ 187,260.20

70,628.43

5,497.10

354,757. II

251,041.94

32,863.55

21,387.15

2,035.03

48,259.24

47,718.62

14,306.14

4,590.87 501,916.12

24,597.24

20,678,635.24 78,631,988.84

49,711.77 11,112,537.52

4,529.90 6,682.21

Total Operating Expenses

$ 976 592 08 $ 87 983.55 $101 197 480.03 $12 604 657 86 $ 245,642 00

Natural Classification
Salaries Staff
Employee Benefits Travel Scholarships and
Fellowships Utilities Supplies and Other
Services Depreciation
Total Operating Expenses

Institutional Su1mort

Functional Classification

Plant

Operations and Scholarships

Unallocated

Maintenance and Fellowshius Deureciation

Total Operating Exuenses

$ 17,107,519.42 4,134,839.26 413,133.69
5,448,216.22 241,899,194.84
$269 002 903 43

$ 6,973,325.53 $ 3,339,850.87 $ 3 339 850 87 $ 6 973 325 53

$ 20,356,190.92 4,849,627.39 546,839.87
6,973,325.53 26, I 85,684.00
335,516,767.64 $ 5,509,163.57 5,509,163.57
$ 5 509 163 57 $399 937 598 92

- 25 -

SUPPLEMENTARY INFORMATION - 27 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT}
SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET - (NON-GAAP BASIS} RESIDENT INSTRUCTION YEAR ENDED JUNE 30. 2003

SCHEDULE "1"

REVENUES
State Appropriations Other Revenues Retained

BUDGET

ACTUAL (1)

VARIANCEFAVORABLE (UNFAVORABLE)

$ 39.137.790.00 $ 39.137.790.00 $

21,653.232.00

17,798,638.64

0.00 -3.854.593.36

$ 60,791,022.00 $ 56.936.428.64 $ _ _-_3.:-.8_54-'-.5_9_3_.3_6

EXPENDITURES
Personal Services: Education, General and Departmental Services Sponsored Operations
Operating Expenses: Education, General and Departmental Services Sponsored Operations
Capital Outlay Special Funding Initiative

$ 14.678,542.00 $ 14,705.704.47 $

1,580,282.00

994,724.34

34,681,142.00 4,852,873.00
0.00 4,998,183.00

33,970.660.50 2,747 .966.62 1,164.52 4,986,279.44

-27.162.47 585,557.66
710,481.50 2.104,906.38
-1.164.52 11,903.56

$ 60,791,022.00 $ 57,406.499.89 $ _ _ _3~.3_84~,5_2_2_.1_1

Excess of Revenues over Expenditures

$ -470,071.25 $===-4=7=0=,0=7=1=.2=5

(1) Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a comprehensive basis of accounting other than generally accepted accounting principles.

See notes to the financial statements.

-29-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT)
SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET - (NON-GAAP BASIS)
REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30. 2003

SCHEDULE "2"

FUNDS AVAILABLE REVENUES
State Appropriations Other Revenues Retained
CARRY-OVER FROM PRIOR YEAR Transfer from Reserved Fund Balance

BUDGET

ACTUAL (1)

VARIANCEFAVORABLE (UNFAVORABLE)

$ 103,316,382.00 $ 5,556,072.00

103,316,382.00 $ 6,213,392.60

$ 108,872,454.00 $ 109,529,774.60 $

0.00 657,320.60
657,320.60

5,139,598.00

5,139,598.00

0.00

$ 114,012,052.00 $ 114,669,372.60 $ _ _ _65_7..a..,3_2_0_.6_0

EXPENDITURES
Personal Services: Education, General and Departmental Services Sponsored Operations
Operating Expenses: Education, General and Departmental Services Sponsored Operations
Capital Outlay SREB Payments Regents Opportunity Grants Rental Payments to Georgia Military College Direct Payments to GPTC for Operations Public Libraries Salaries and Operations Georgia Medical College Health, Inc.

$

7,819,850.00 $

1,269,535.00

12,905,941.00 3,936,417.00 0.00 810,328.00 556,084.00 1,700,937.00
18,565,802.00 32,066,708.00 34,380,450.00

7,819,840.84 $ 552,725.75
10,306,729.79 4,208,575.00 5,990,759.19 802,161.00 554,209.00 1,700,937.00
18,565,802.00 32,057,190.18 34,380,450.00

9.16 716,809.25
2,599,211.21 -272, 158.00
-5,990,759.19 8,167.00 1,875.00 0.00 0.00 9,517.82 0.00

$ 114,012,052.00 $ 116,939,379.75 $ _ _-2-',_92_7..a..,3_2_7._7_5

Excess of Revenues over Expenditures

$

-2,270,007.15 $==-2='=27=0=,0=0=7.=1=5

(1) Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a comprehensive basis of accounting other than generally accepted accounting principles.

See notes to the financial statements.

- 30 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT)
SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET - (NON-GAAP BASIS} LOTTERY FOR EDUCATION YEAR ENDED JUNE 30. 2003

SCHEDULE "3"

REVENUES State Appropriations
EXPENDITURES Equipment, Technology and Construction
Trust Fund Georgia Public Telecommunications Commission Special Funding Initiatives

BUDGET

ACTUAL (1)

VARIANCEFAVORABLE (UNFAVORABLE)

- - - - - - - $ 10,009,000.00 $ 10.009,000.00 $

0.00

$

500,000.00 $

500,000.00 $

0.00

2,000,000.00

2,000,000.00

0.00

7,509,000.00

7,509,000.00

0.00

$ 10,oos,000.00 $ 10,oos,000.00 $ _ _ _ _ _o_.o_o

Excess of Revenues over Expenditures

$

0.00 $ = = = = = =0.0=0

(1) Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a comprehensive basis of accounting other than generally accepted accounting principles.

See notes to the financial statements.

- 31 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF APPROVED BUDGET RESIDENT INSTRUCTION YEAR ENDED JUNE 30. 2003

REVENUES
State Appropriations Other Revenues Retained

ORIGINAL APPROPRIATION

AMENDED APPROPRIATION

GOVERNOR'S EMERGENCY FUND

$ 1,498,050,811.00 $ 2,088,105,968.00

-46,604,648.00 $ 110,980,231.00

35,000.00

$ 3,586,156,779.00 $

64,375,583.00 $ ===~3;,;;5;,:,;,0;,;;;0,;:;;0.~00~

EXPENDITURES
Personal Services: Education, General and Departmental Services Sponsored Operations
Operating Expenses: Education, General and Departmental Services Sponsored Operations
Capital Outlay Special Funding Initiative Office of Minority Business Enterprises Student Education Enrichment Program Forestry Research Research Consortium Austerity Adjustments

$ 1,732,309,454.00 $ 388,632,432.00
380,727,080.00 827,773,561.00 188,870,159.00
34,809,941.00 1,173,546.00 356,529.00 1,042,915.00
30,461,162.00

27,803,998.00 35,591,073.00
70,971,010.00 $ 26,415,180.00 -65,285,428.00 -1,044,298.00
-35,206.00 -10,696.00 -31,288.00 -169,464.00 -29 ,829,298.00

35,000.00

$ 3,586,156,779.00 $

64,375,583.00 $=====35;;i,,O;,;;O~O;,;;;.O,;;,,O

See notes to the financial statements.

- 32 -

SCHEDULE "4"

BUDGET ADJUSTMENTS

TOTAL APPROVED
BUDGET

LESS: BUDGET TRANSFERS TO OTHER UNITS

TOTAL

$ 1,451,481,163.00 $

$ 232,342,550.00

2,431,428,749.00

1,412,343,373.00 $ 39,137,790.00

2,409,775,517.00

21,653,232.00

$ 232,342,550.00 $ 3,882,909,912.00 $ 3,822,118,890.00 $ 60,791,022.00

$ -10,935,469.00 $ 1,749,177,983.00 $ 1,734,499,442.00 $ 14,678,541.00

49,123,916.00

473,347,421.00

471,767,139.00

1,580,282.00

49,428,758.00 97,443,531.00 18,277,679.00
-696, 198.00 -23,471.00 -7,131.00 379,142.00
-477,505.00 29,829,298.00

501,161,848.00 951,632,272.00 141,862,410.00
33,069,445.00 1,114,869.00 338,702.00 1,390,769.00
29,814,193.00 0.00

466,480,705.00 946,779,399.00 141,862,410.00
28,071,262.00 1,114,869.00 338,702.00 1,390,769.00
29,814,193.00

34,681,143.00 4,852,873.00 0.00 4,998,183.00 0.00 0.00 0.00 0.00 0.00

$ 232,342,550.00 $ 3,882,909,912.00 $ 3,822,118,890.00 $ 60,791,022.00

- 33 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF APPROVED BUDGET
REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30, 2003

FUNDS AVAILABLE REVENUES
State Appropriation Other Revenues Retained
CARRY-OVER FROM PRIOR YEAR Transfer from Reserved Fund Balance

ORIGINAL APPROPRIATION

AMENDED APPROPRIATION

$ 232,847,640.00 $
188,978,476.00
$ 421,826,116.00 $

-12,133,175.00 17,694,866.00
5,561,691.00

1,799,747.00

$ 421,826,116.00 $ ===7'=36=1=,4=3=8.=00=

EXPENDITURES
Personal Services: Education, General and Departmental Services Sponsored Operations
Operating Expenses: Education, General and Departmental Services Sponsored Operations
Agricultural Research Advanced Technology Development Center/
Economic Development Institute Seed Capital Fund -ATDC Center for Rehabilitation Technology SREB Payments Regents Opportunity Grants Rental Payments to Georgia Military College Direct Payments to the Georgia Public
Telecommunications Commission for Operations Public Libraries Salaries and Operations Georgia Medical College Health, Inc. Austerity Adjustments

$ 136,921,138.00 $
65,692,480.00
59,809,345.00 31,293,568.00
3,199,567.00
23,525,319.00
7,339,889.00 874,601.00 565,155.00
1,735,650.00
19,574,482.00 35,104,975.00 36,189,947.00

-1,322,408.00 5,266,911.00
428,029.00 9,808,089.00
-95,987.00
-457,652.00
450,198.00 -26,238.00 -16,955.00
-1,008,680.00 -349,477.00
-1,085,698.00 -4,228,694.00

See notes to the financial statements.

$ 421,826,116.00 $ =====7=,3=6=1=,4=38=.=00=
- 34-

SCHEDULE "5"

BUDGET ADJUSTMENTS

TOTAL APPROVED
BUDGET

LESS: BUDGET TRANSFERS TO OTHER UNITS

TOTAL

$ 220,714,465.00 $

$ 22,309,743.00

228,983,085.00

$ 22,309,743.00 $ 449,697,550.00 $

117,398,083.00 $ 103,316,382.00

223,427,013.00

5,556,072.00

340,825,096.00 $ 108,872,454.00

19,425,485.00

21,225,232.00

16,085,634.00

5,139,598.00

$ 41,735,228.00 $ 470,922,782.00 $

356,910,730.00 $ 114,012,052.00

$

319,212.00 $ 135,917,942.00 $

5,706,957.00

76,666,348.00

22,399,189.00 12,630,453.00
-63,992.00

82,636,563.00 53,732, 110.00
3,039,588.00

-65,039.00
57,207.00 -38,035.00
7,884.00 -34,713.00

23,002,628.00 0.00
7,847,294.00 810,328.00 556,084.00
1,700,937.00

-2,688,790.00 -723,799.00 4,228,694.00

18,565,802.00 32,066,708.00 34,380,450.00
0.00

128,098,092.00 $
75,396,813.00

7,819,850.00 1,269,535.00

69,730,622.00 49,795,693.00
3,039,588.00

12,905,941.00 3,936,417.00 0.00

23,002,628.00 7,847,294.00

0.00 0.00 0.00 810,328.00 556,084.00 1,700,937.00

18,565,802.00 32,066,708.00 34,380,450.00
0.00

$ 41,735,228.00 $ 470,922,782.00 $

356,910,730.00 $ 114,012,052.00

- 35 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF APPROVED BUDGET LOTTERY FOR EDUCATION YEAR ENDED JUNE 30. 2003

FUNDS AVAILABLE REVENUES
State Appropriation Other Revenues Retained
CARRY-OVER FROM PRIOR YEAR Transfer from Reserved Fund Balance
EXPENDITURES Equipment, Technology and Construction
Trust Fund Georgia Public Telecommunications Commission Special Funding Initiatives Student Information System Prior Year ETACT - University of Georgia Prior Year ETACT - Georgia State University

ORIGINAL APPROPRIATION

AMENDED APPROPRIATION

$

0.00 $

21,509,000.00

$

0.00 $

21,509,000.00

$

0.00 $ ====2=1,=50=9=,0=0=0.=00=

$

0.00 $

12,000,000.00

2,000,000.00

7,509,000.00

$

o.oo $ ==2=1,=so=g='o=o=o.=00=

See notes to the financial statements.

- 36-

SCHEDULE "6"

BUDGET ADJUSTMENTS

TOTAL APPROVED
BUDGET

LESS: BUDGET TRANSFERS TO OTHER UNITS

TOTAL

$ 21,509,000.00 $

$ 5,939,193.00

5,939, 193.00

$ 5,939,193.00 $ 27,448,193.00 $

11,500,000.00 $ 10,009,000.00

5,939,193.00

0.00

17,439,193.00 $ 10,009,000.00

2,769,580.00

2,769,580.00

2,769,580.00

0.00

$ 8,708,773.00 $ 30,217,773.00 $

20,208,773.00 $ 10,009,000.00

$ 12,000,000.00 $

2,000,000.00

7,509,000.00

$ 5,939,193.00

5,939, 193.00

1,521,480.00

1,521,480.00

1,248,100.00

1,248,100.00

11,500,000.00 $
5,939,193.00 1,521,480.00 1,248,100.00

500,000.00 2,000,000.00 7,509,000.00
0.00 0.00 0.00

$ 8,708,773.00 $ 30,217,773.00 $

20,208,773.00 $ 10,009,000.00

- 37 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNID SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS RESIDENT INSTRUCTION YEAR ENDED JUNE 30. 2003

UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA
RESEARCH UNIVERSITIES
Georgia Institute of Technology Research Consortium Special Funding Initiative
Georgia State University Research Consortium Research Consortium (Tobacco Funds) Special Funding Initiative Office of Minority Business Enterprise
Medical College of Georgia Student Education Enrichment Program Special Funding Initiative
University of Georgia Forestry Research Office of Minority Business Enterprise Research Consortium Special Funding Initiative
REGIONAL UNIVERSITIES
Georgia Southern University Research Consortium Special Funding Initiative
Valdosta State University Special Funding Initiative
STATE UNIVERSITIES/COLLEGES
Albany State University Office of Minority Business Enterprise Special Funding Initiative
Armstrong Atlantic State University Research Consortium 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 Research Consortium Special Funding Initiative
North Georgia College and State University Special Funding Initiative
See notes to the financial statements.

PERSONAL SERVICES

EDUCATION,

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

APPROVED BUDGET

OPERATING EXPENSES

EDUCATION,

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

$

259,555,702.00 $ 99,182,658.00 $

90,134,072.00 $

100,817,342.00

214,743,321.00

40,000,000.00

70,497,769.00

115,000,000.00

112,733,911.00

195,086,158.00

390,993,401.00

83,000,000.00

24,992,038.00 104,349,788.00

149,682,909.00 233,000,000.00

91,236,812.00 58,063,730.00

4,247,811.00 2,366,633.00

18,658,741.00 10,491, 162.00

73,752, 189.00 9,614,743.00

23,718,254.00

5,120,749.00

29,908,147.00

631,386.00

29,835,711.00

388,124.00

23,666,554.00 33,451,643.00 21,271,036.00 35,443, 165.00 14,993,627.00 75,686,653.00

2,912,960.00 3,713,882.00 10;665,486.oo
439,197.00 1,581,064.00 4,175,703.00

23,444,058.00

929,203.00

3,799,736.00
7,465,844.00
5,484,676.00
7,724,166.00 7,268,168.00 4,275,227.00 7,279,315.00 4,649,559.00 19,955,718.00
4,714,865.00

21,897,154.00
5,762,148.00
10,005,110.00
11,108,651.00 26,953,755.00 25,683,103.00 15,175,394.00
4,988,794.00 20,931,191.00
1,956,238.00

-38-

SCHEDULE "7"

CAPITAL OUTLAY

OTHER

TOTAL

STATE FUNDS

FUNDING PROVIDED OTHER
REVENUES RETAINED

TOTAL

$ 39,986,572.00

$

$ 18,566,787.00

4,572,463.00

9,507,054.00

490,121.00

6,585,889.00

1,465,290.00

88,333.00

1,908,444.00

338,702.00

2,072,849.00

66,700,624.00

1,390,769.00

567,207.00

2,633,745.00

2,080,238.00

589,676,346.00 $ 18,566,787.00 4,572,463.00
449,748,144.00 490,121.00
6,585,889.00 1,465,290.00
88,333.00 484,403,460.00
338,702.00 2,072,849.00 878,043,813.00 1,390,769.00
567,207.00 2,633,745.00 2,080,238.00

168,417,668.00 $ 18,566,787.00 4,572,463.00
162,029,803.00 490,121.00
6,585,889.00 1,465,290.00
88,333.00 109,513,608.00
338,702.00 2,072,849.00 312,823,335.00 1,390,769.00
567,207.00 2,633,745.00 2,080,238.00

421,258,678.00 $ 287,718,341.00
374,889,852.00 565,220,478.00

589,676,346.00 18,566,787.00 4,572,463.00
449,748,144.00 490,121.00
6,585,889.00 1,465,290.00
88,333.00 484,403,460.00
338,702.00 2,072,849.00 878,043,813.00 1,390,769.00
567,207.00 2,633,745.00 2,080,238.00

700,000.00 660,000.00

341,482.00 3,563,610.00
538,082.00

188,595,553.00 341,482.00
3,563,610.00 81,196,268.00
538,082.00

70,808,510.00 341,482.00
3,563,610.00 45,375,104.00
538,082.00

117,787,043.00 35,821,164.00

188,595,553.00 341,482.00
3,563,610.00 81,196,268.00
538,082.00

267,898.00 172,008.00
798,830.00 3,736,477.00 1,342,214.00
307,331.00 6,796,919.00
537,831.00

105,999.00 1,378,481.00
601,744.00 1,028,927.00
176,665.00 100,145.00
36,053.00
55,666.00
2,748,152.00
1,636,245.00
204,368.00
336,318.00 504,005.00
929,482.00

54,535,893.00 105,999.00
1,378,481.00 44,035,423.00
601,744.00 1,028,927.00 45,885,629.00
176,665.00 100,145.00 45,412,331.00
36,053.00 72,186,278.00
55,666.00 65,631,329.00
2,748,152.00 59,679,285.00
1,636,245.00 26,520,375.00
204,368.00 127,546,184.00
336,318.00 504,005.00 31,582,195.00 929,482.00

19,026,275.00 105,999.00
1,378,481.00 23,675,593.00
601,744.00 1,028,927.00 23,020,635.00
176,665.00 100,145.00 17,281,048.00
36,053.00 26,250,381.00
55,666.00 18,709,043.00 2,748,152.00 26,489,306.00
1,636,245.00 12,931,731.00
204,368.00 53,511,630.00
336,318.00 504,005.00 18,336,955.00 929,482.00

35,509,618.00
20,359,830.00
22,864,994.00
28,131,283.00 45,935,897.00 46,922,286.00 33,189,979.00 13,588,644.00 74,034,554.00
13,245,240.00

54,535,893.00 105,999.00
1,378,481.00 44,035,423.00
601,744.00 1,028,927.00 45,885,629.00
176,665.00 100,145.00 45,412,331.00 36,053.00 72,186,278.00 55,666.00 65,631,329.00 2,748,152.00 59,679,285.00 1,636,245.00 26,520,375.00 204,368.00 127,546,184.00 336,318.00 504,005.00 31,582,195.00 929,482.00

-39-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS RESIDENT INSTRUCTION YEAR ENDED JUNE 30 2003

UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA
STATE UNIVERSITIES/COLLEGES
Savannah State University Special Funding Initiative
Southern Polytechnic State University Research Consortium Special Funding Initiative
State University of West Georgia Special Funding Initiative
ASSOCIATE DEGREE COLLEGES
Abraham Baldwin Agricultural College Special Funding Initiative
Atlanta Metropolitan College Office of Minority Business Enterprise Special Funding Initiative
Bainbridge College Special Funding Initiative
Coastal Georgia Community College Special Funding Initiative
Dalton State College Special Funding Initiative
Darton College Special Funding Initiative
East Georgia College Special Funding Initiative
Floyd College Special Funding Initiative
Gainesville College Special Funding Initiative
Georgia Perimeter College Special Funding Initiative
Gordon College Special Funding Initiative
Macon State College Special Funding Initiative
Middle Georgia College Special Funding Initiative
South Georgia College Special Funding Initiative
Waycross College Special Funding Initiative
OTHER
Skidaway Institute of Oceanography

PERSONAL SERVICES

EDUCATION,

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

APPROVED BUDGET

OPERATING EXPENSES

EDUCATION,

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

$

19,472,326.00 $

2,168,422.00 $

23,973,068.00

1,211,041.00

3,432,189.00 $ 5,010,710.00

14,808,298.00 8,982,906.00

48,660,633.00

2,073,810.00

11,880,461.00

29,334,930.00

13,381,618.00 9,571,890.00
5,848,642.00 8,468,693.00 12,436,982.00 14,127,946.00 4,775,336.00 11,696,079.00 14,104,765.00 60,950,000.00 10,409,302.00 17,542,301.00 10,330,470.00 6,160,125.00 3,785,945.00

917,486.00 938,662.00
855,034.00 1,612,147.00 2,253,396.00
813,075.00 67,093.00
464,252.00 582,461.00 830,000.00
2,155,918.00 155,056.00 192,427.00 35,845.00

3,553,678.00 1,550,078.00
1,393,498.00 2,566,307.00 3,101,817.00 2,121,528.00 1,338,346.00 2,804,472.00 2,911,249.00 18,816,852.00 4,181,064.00 4,361,448.00 2,715,973.00 2,023,322.00
814,369.00

6,289,174.00 3,963,830.00
2,890,680.00 3,012,853.00 4,812,619.00 5,300,778.00 1,998,506.00 2,898,032.00 2,367,404.00 14,770,000.00 4,500,000.00 7,530,952.00 3,434,644.00 2,435,658.00 1,119,414.00

57,596.00

162,500.00

$ 1,734,499,442.00 $ 471,767,139.00 $

466,480,705.00 $ ====9=4=6'-=77=9a!a,3=99=.0=0

See notes to the financial statements.

-40-

SCHEDULE "7"

CAPITAL OUTLAY

OTHER

TOTAL

STATE FUNDS

FUNDING PROVIDED OTHER
REVENUES RETAINED

TOTAL

$

$

819,031.00

$

3,350,309.00

258,107.00 273,761.00
1,058,499.00

39,881,235.00 $ 819,031.00
39,177,725.00 258,107.00 273,761.00
95,300,143.00 1,058,499.00

16, 189,023.00 $ 819,031.00
19,060,505.00 258,107.00 273,761.00
38,694,466.00 1,058,499.00

23,692,212.00 $ 20,117,220.00
56,605,677.00

39,881,235.00 819,031.00
39,177,725.00 258,107.00 273,761.00
95,300, 143.00 1,058,499.00

800,000.00 220,128.00
6,000.00 3,000.00 713,064.00 100,000.00 287,911.00
198,958.00 1,925,000.00
403,256.00 50,000.00
238,279.00 144,303.00

210,919.00 176,665.00 176,698.00 58,385.00 67,115.00 18,354.00 74,337.00 849,234.00 175,076.00 288,104.00 82,790.00
4,100.00 221,014.00 656,225.00
60,003.00 63,561.00

24,941,956.00 210,919.00
16,244,588.00 176,665.00 176,698.00
10,993,854.00 58,385.00
15,663,000.00 67,115.00
23,317,878.00 18,354.00
22,463,327.00 74,337.00
8,467, 192.00 849,234.00
17,862,835.00 175,076.00
20,164,837.00 288,104.00
97,291,852.00 82,790.00
19,090,366.00 4,100.00
31,993,875.00 221,014.00
16,686,143.00 656,225.00
11,049,811.00 60,003.00
5,899,876.00 63,561.00

12,135,915.00 210,919.00
7,666,503.00 176,665.00 176,698.00
4,556,080.00 58,385.00
7,609,965.00 67,115.00
10,262,317.00 18,354.00
10,841,682.00 74,337.00
4, 169,254.00 849,234.00
9,777,618.00 175,076.00
10,833,270.00 288,104.00
47,470,031.00 82,790.00
10,402,688.00 4,100.00
14,674,429.00 221,014.00
9,833,998.00 656,225.00
5,504,962.00 60,003.00
3,510,151.00 63,561.00

12,806,041.00 8,578,085.00
6,437,774.00 8,053,035.00 13,055,561.00 11,621,645.00 4,297,938.00 8,085,217.00 9,331,567.00 49,821,821.00 8,687,678.00 17,319,446.00 6,852, 145.00 5,544,849.00 2,389,725.00

24,941,956.00 210,919.00
16,244,588.00 176,665.00 176,698.00
10,993,854.00 58,385.00
15,663,000.00 67,115.00
23,317,878.00 18,354.00
22,463,327.00 74,337.00
8,467,192.00 849,234.00
17,862,835.00 175,076.00
20,164,837.00 288,104.00
97,291,852.00 82,790.00
19,090,366.00 4,100.00
31,993,875.00 221,014.00
16,686,143.00 656,225.00
11,049,811.00 60,003.00
5,899,876.00 63,561.00

220,096.00

220,096.00

220,096.00

$ 141,862,410.00 $ 60,729,795.00 $ 3,822,118,890.00 $ 1,412,343,373.00 $ 2,409,775,517.00 $ 3,822,118,890.00

- 41 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE [OVERSIGHT UNIT} SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS
REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30. 2003

UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA
RESEARCH UNIVERSITIES
Georgia Institute of Technology Education Extension Services Advanced Technology Development Center Georgia Tech Research Institute Agricultural Research Center for Rehabilitation Technology State Data Center
Medical College of Georgia Medical College of Georgia Hospital and Clinics Georgia Radiation Therapy Center
University of Georgia Agricultural Experiment Station Athens and Tifton Veterinary Laboratories Cooperative Extension Service Marine Institute Marine Resources Extension Center Veterinary Medicine Experiment Station Agricultural Research Veterinary Medicine Teaching Hospital
OTHER
Skidaway Institute of Oceanography

PERSONAL SERVICES

EDUCATION.

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

APPROVED BUDGET

OPERATING EXPENSES

EDUCATION.

GENERAL AND

DEPARTMENTAL

SPONSORED

SERVICES

OPERATIONS

$

27,113,922.00 $ 47,577,078.00 $

22,558,707.00 $ 23,355,000.00

1,267,137.00

7,422.00

2,224,653.00
43,679,331.00 102,687.00
43,013,160.00 821,655.00
1,565,905.00 2,306,291.00
3,632,470.00

13,100,000.00 3,465,473.00 8,100,000.00 575,000.00 660,000.00

20,539,173.00
193,500.00 1,401,157.00
12,950,502.00
5,930,644.00 285,335.00 824,332.00 262,623.00
4,398,549.00

674,036.00
15,400,000.00 1,888,497.00 6,300,000.00 125,000.00 290,000.00

2,370,881.00

1,911,840.00

386,100.00

1,763,160.00

$

128,098,092.00 $ 75,396,813.00 $

69,730,622.00 $ 49,795,693.00

See notes to the financial statements.

-42 -

SCHEDULE "8"

OTHER

TOTAL

STATE FUNDS

FUNDING PROVIDED

OTHER

CARRY-OVER

REVENUES

OF PRIOR

RETAINED

YEAR FUNDS

TOTAL

$ 23,002,628.00 $ 23,002,628.00 $

120,604,707.00

1,740,142.00

1,740,142.00

7,847,294.00

7,847,294.00

22,487,768.00

9,739,353.00 $ 1,132,042.00 1,740,142.00 6,763,912.00 5,570,676.00

13,263,275.00 119,472,665.00
1,083,382.00 831,458.00 $

$ 16,085,634.00

23,002,628.00 120,604,707.00
1,740,142.00 7,847,294.00 22,487,768.00

193,500.00 3,625,810.00

193,500.00 3,625,810.00

193,500.00 3,625,810.00

1,299,446.00

85,129,833.00 5,456,657.00
63,343,804.00 1,806,990.00 3,340,237.00 2,568,914.00 1,299,446.00 8,031,019.00

45,012,340.00 102,687.00
38,509,667.00 1,039,357.00 1,615,437.00 2,568,914.00 1,299,446.00 531,019.00

40,117,493.00 5,353,970.00
24,834,137.00 767,633.00
1,724,800.00
7,500,000.00

85,129,833.00 5,456,657.00
63,343,804.00 1,806,990.00 3,340,237.00 2,568,914.00 1,299,446.00 8,031,019.00

6,431,981.00

1,773,091.00

4,658,890.00

6,431,981.00

$ 33,889,510.00 $ 356,910,730.00 $ 117,398,083.00 $ 223,427,013.00 $ 16,085,634.00 $ 356,910,730.00

- 43 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT} SCHEDULE OF BUDGET TRANSFERS TO OTHER UNITS LOTTERY FOR EDUCATION YEAR ENDED JUNE 30. 2003

UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA
RESEARCH UNIVERSITIES
Georgia Institute of Technology Student Information System
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 State College Darton College East Georgia College Floyd College Gainesville College Georgia Perimeter College Gordon College Macon State College Middle Georgia College South Georgia College Waycross College
OTHER
Skidaway Institute of Oceanography

APPROVED BUDGET

EQUIPMENT,

TECHNOLOGY

AND

CONSTRUCTION

TRUST FUND

OTHER

TOTAL

$

2,742,978.00

$ 2,742,978.00

$ 5,939,193.00

5,939,193.00

2,311,296.00

2,311,296.00

627,666.00

627,666.00

4,343,284.00

4,343,284.00

385,858.00 342,338.00

385,858.00 342,338.00

142,780.00 186,222.00 186,222.00 153,334.00 186,230.00
92,722.00 186,230.00 92,724.00 233,448.00 142,936.00 106,522.00 142,780.00 233,448.00

142,780.00 186,222.00 186,222.00 153,334.00 186,230.00
92,722.00 186,230.00
92,724.00 233,448.00 142,936.00 106,522.00 142,780.00 233,448.00

102,012.00 56,362.00 56,362.00 56,362.00 127,192.00 102,010.00 33,536.00 103,500.00 102,010.00 230,682.00 102,012.00 127,192.00 102,012.00 56,362.00 33,536.00

102,012.00 56,362.00 56,362.00 56,362.00 127,192.00 102,010.00 33,536.00 103,500.00 102,010.00 230,682.00 102,012.00 127,192.00 102,012.00 56,362.00 33,536.00

39,420.00

39,420.00

See notes to the financial statements.

$

14,269,580.00 $ 5,939,193.00 $ 20,208,773.00

- 44 -

SCHEDULE "9"

STATE FUNDS

FUNDING PROVIDED

OTHER

CARRY-OVER

REVENUES

OF PRIOR

RETAINED

YEAR FUNDS

TOTAL

$ 2,742,978.00

$

$ 5,939,193.00

1,063,196.00

$ 1,248,100.00

627,666.00

2,821,804.00

1,521,480.00

2,742,978.00 5,939,193.00 2,311,296.00
627,666.00 4,343,284.00

385,858.00 342,338.00

385,858.00 342,338.00

142,780.00 186,222.00 186,222.00 153,334.00 186,230.00
92,722.00 186,230.00
92,724.00 233,448.00 142,936.00 106,522.00 142,780.00 233,448.00

142,780.00 186,222.00 186,222.00 153,334.00 186,230.00
92,722.00 186,230.00
92,724.00 233,448.00 142,936.00 106,522.00 142,780.00 233,448.00

102,012.00 56,362.00 56,362.00 56,362.00
127,192.00 102,010.00
33,536.00 103,500.00 102,010.00 230,682.00 102,012.00 127,192.00 102,012.00
56,362.00 33,536.00

102,012.00 56,362.00 56,362.00 56,362.00
127,192.00 102,010.00
33,536.00 103,500.00 102,010.00 230,682.00 102,012.00 127,192.00 102,012.00
56,362.00 33,536.00

39,420.00

39,420.00

$ 11,500,000.00 $ 5,939,193.00 $ 2,769,580.00 $ 20,208,773.00

- 45 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT)
SCHEDULE OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA RESIDENT INSTRUCTION
YEAR ENDED JUNE 30. 2003

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 State College Darton College East Georgia College Floyd College Gainesville College Georgia Perimeter College Gordon College Macon State College Middle Georgia College South Georgia College Waycross College
OTHER
Skidaway Institute of Oceanography
See notes to the financial statements.

REGULAR

GOVERNOR'S EMERGENCY
FUNDS

CAPITAL OUTLAY

$ 168,417,668.00
158,847,790.00 109,513,608.00 313,208,335.00 $

$ 3,182,013.00
15,000.00

70,808,510.00 45,375,104.00

19,026,275.00 23,675,593.00 23,019,075.00 17,281,048.00 26,250,381.00 18,709,043.00 26,489,306.00 12,931,731.00 53,511,630.00 18,336,955.00 16,189,023.00 19,060,505.00 38,674,466.00

1,560.00 20,000.00

12,135,915.00 7,666,503.00 4,556,080.00 7,609,965.00
10,262,317.00 10,841,682.00
4,169,254.00 9,777,618.00 10,833,270.00 47,390,031.00 10,402,688.00 14,674,429.00 9,833,998.00 5,504,962.00 3,510,151.00

80,000.00

220,096.00

$ 1,348,715,005.00 $

35,000.00 $ 3,263,573.00

-46-

SCHEDULE "10"

SPECIAL FUNDING INITIATIVE

OFFICE OF MINORITY BUSINESS ENTERPRISE

STUDENT EDUCATION ENRICHMENT PROGRAM

FORESTRY RESEARCH

RESEARCH CONSORTIUM

TOTAL

$ 4,572,463.00 1,465,290.00 $ 2,072,849.00 2,080,238.00

88,333.00 $
567,207.00

338,702.00 $

$ 18,566,787.00 $
7,076,010.00

990,769.00

2,633,745.00

191,556,918.00 170,659,436.00 111,925,159.00 319,495,294.00

3,563,610.00 538,082.00

341,482.00

74,713,602.00 45,913,186.00

1,378,481.00 1,028,927.00
100,145.00 36,053.00 55,666.00
2,748,152.00 1,636,245.00
204,368.00 504,005.00 929,482.00 819,031.00 273,761.00 1,058,499.00

105,999.00 176,665.00

601,744.00
336,318.00 258,107.00

20,510,755.00 25,306,264.00 23,297,445.00 17,317,101.00 26,306,047.00 21,457,195.00 28,125,551.00 13,136,099.00 54,351,953.00 19,266,437.00 17,008,054.00 19,592,373.00 39,752,965.00

210,919.00 176,698.00
58,385.00 67,115.00 18,354.00 74,337.00 849,234.00 175,076.00 288,104.00 82,790.00
4,100.00 221,014.00 656,225.00
60,003.00 63,561.00

176,665.00

12,346,834.00 8,019,866.00 4,614,465.00 7,677,080.00
10,280,671.00 10,916,019.00
5,018,488.00 9,952,694.00 11,121,374.00 47,552,821.00 10,406,788.00 14,895,443.00 10,490,223.00 5,564,965.00 3,573,712.00

220,096.00

$ 28,071,262.00 $

1,114,869.00 $

338,702.00 $ 990,769.00 $ 29,814,193.00 $ 1,412,343,373.00

-47-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA

SCHEDULE "11"

ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT)

SCHEDULE OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA

REGENTS CENTRAL OFFICE AND OTHER ORGANIZED ACTIVITIES

YEAR ENDED JUNE 30. 2003

RESEARCH UNIVERSITIES
Georgia Institute of Technology Education Extension Services Advanced Technology Development Center State Data Center Student Information Center Georgia Tech Research Institute
University of Georgia Agricultural Experiment Station Athens and Tifton Veterinary Laboratories Cooperative Extension Service Marine Institute Marine Resources Extension Center Veterinary Medicine Experiment Station Agricultural Research Veterinary Medicine Teaching Hospital
OTHER
Skidaway Institute of Oceanography

$ 9,739,353.00
5,570,676.00 9,636,096.00
45,012,340.00 102,687.00
38,509,667.00 1,039,357.00 1,615,437.00 2,568,914.00 1,299,446.00 531,019.00
1,773,091.00
$ 117,398,083.00

See notes to the financial statements.

- 48 -

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA

SCHEDULE "12"

ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT)

SCHEDULE OF ALLOTMENTS TO UNITS OF THE UNIVERSITY SYSTEM OF GEORGIA

LOTTERY FOR EDUCATION

YEAR ENDED JUNE 30. 2003

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 State College Darton College East Georgia College Floyd College Gainesville College Georgia Perimeter College Gordon College Macon State College Middle Georgia College South Georgia College Waycross College
OTHER
Skidaway Institute of Oceanography

EQUIPMENT, TECHNOLOGY
AND
CONSTRUCTION TRUST FUND

$

2,742,978.00

1,063,196.00

627,666.00

2,821,804.00

385,858.00 342,338.00

142,780.00 186,222.00 186,222.00 153,334.00 186,230.00
92,722.00 186,230.00
92,724.00 233,448.00 142,936.00 106,522.00 142,780.00 233,448.00

102,012.00 56,362.00 56,362.00 56,362.00
127,192.00 102,010.00
33,536.00 103,500.00 102,010.00 230,682.00 102,012.00 127,192.00 102,012.00
56,362.00 33,536.00

39,420.00

See notes to the financial statements.

- 49 -

$ ======1==1~'s=oo=!e,o=o=o=.o==o

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE /OVERSIGHT UNITI
ANALYSIS OF PRIOR YEAR'S SURPLUS FUNDS COLLECTED FROM INSTITUTIONS AND REDISTRIBUTED TO INSTITUTIONS WITH DEFICITS YEAR ENDED JUNE 30 2003

TOTAL COLLECTED REDISTRIBUTED

RESIDENT INSTRUCTION

REGULAR

LOTTERY FOR EDUCATION

COLLECTED

REDISTRIBUTED

COLLECTED REDISTRIBUTED

RESEARCH UNIVERSITIES

Georgia Institute of Technology Georgia State University Medical College of Georgia University of Georgia

$ 515,198.77 $ 106,829.66 33,803.58 139,341.45

515,198.77 $

202,254.59 106,829.66

18,822.04

$

$

33,803.58

8,325.79

0.00

REGIONAL !,!NIVERSITIES

Georgia Southam University Valdosta State University

13,309.60 2,045.56

544.37

6,531.60 $

544.37

98.00 2,024.00

STATE UNIVERSITIES/QQLLEGES

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 Southwestem State University Kennesaw State University North Georgia College and State University Savannah State University Southam Polytechnic State University State University of West Georgia

33,979.46 10,056.77 11,968.65 35,753.64 96,070.06 74,067.85 51,737.87 11,365.65 169,930.25
2,981.46 436.13 0.00
39,775.64

99,719.16 951.18
124,421.98

32,300.32 10,056.77
35,372.14 74,734.21 73,694.10 16,229.57 11,159.79 71,454.10
2,900.13
35,611.11

951.18

1,679.14
1,974.45 373.75
3,952.23 194.23
27,654.64
436.13 402.04

ASSOCIATE DEGREE COLLEGES

Abraham Baldwin Agricultural College Atlanta Metropolitan College Bainbridge College Coastal Georgia Community College Dalton State College Darton College East Georgia College Floyd College Gainesville College Georgia Perimeter College Gordon College Macon State College Middle Georgia College South Georgia College Waycross College

4,064.16 595.44
8,331.73 602.55
5,341.72 37,602.72 89,466.02 127,803.62
4,448.83 0.65
36,151.84 7,840.40
72,732.18 10,728.47
1,121.56

30,906.26
6,183.77 13,639.02 60,464.79

3,771.60
3,273.80 602.55
5,025.12 33,689.36 84,053.94 83,239.59
4,448.83
6,841.90 72,514.77 10,726.99
1,071.56

30,906.26

6,180.77 13,639.02

116.00 5,412.08
0.65
217.41

OTHER

Skidaway Institute of Oceanography

75,555.99

75,382.19

$ 1,831,039.93 $

852,029.30 $ 1,082,592.33 $

52,221.60 $

86 664.12 $

0.00

Current Funds - Unrestricted Surplus
See notes to the financial statements.

979,010.63
s s 1,831,039_93 ====1,.,.83..,1.0..,.39=.9=3=
-50-

SCHEDULE "13"

OTHER ORGANIZED ACTIVITIES

REGULAR

LOTTERY FOR EDUCATION

COLLECTED REDISTRIBUTED

COLLECTED REDISTRIBUTED

PLANT FUNDS

REGULAR

LOTTERY FOR EDUCATION

COLLECTED REDISTRIBUTED

COLLECTED

REDISTRIBUTED

$ 312,944.18 $ 83,906.63

0.00

$

$

7,965.47

0.00

$

515,198.77 $

$

20,321.52

0.00 $

0.00

6,680.00 21.56

11,968.65 381.50
19,361.40
31,556.07 11.63
70,821.51 81.33
3,762.49

99,719.16 124,421.98

292.56 595.44 5,057.93
316.60 3,797.36
44,564.03
36,151.84 998.50
1.48 50.00

3.00 60,464.79

100.00 $ 396,950.81 $

73.80

0.00 $

7 965.47 $ =====o.o..o.,. $ 256,867.20 $

799 807.70 $

o.oo $ =====o.o..o.,.

-51-

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) RECONCILIATION OF SALARIES AND TRAVEL YEAR ENDED JUNE 30, 2003

SCHEDULE "14"

Totals per Annual Supplement
Compensated Absences June 30, 2003 June 30, 2002

SALARIES
$ 20,056,220.52 $

TRAVEL 546,839.87

2,059,104.42 -1,759,134.02

$ 20,356,190.92 $ ==5=46='=83=9=.8=7=

See notes to the financial statements.

- 52-

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

BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA ADMINISTRATIVE CENTRAL OFFICE (OVERSIGHT UNIT) AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2003

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-472-02-01

Previously Reported Corrective Action Implemented