Audit report, state of Georgia, Georgia Southern University, Statesboro, Georgia, year ended June 30, 1999

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AUDIT REPORT STATEOF GEORGIA GEORGIA SOUTHERN UNIVERSITY STATESBORO, GEORGIA YEAR ENDEDJUNE 30, 1999
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STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET ATLANTA, GEORGIA 30334-8400

GEORGIA SOUTHERN UNIVERSITY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

FINANCIAL STATEMENTS

A COMBINED BALANCE SHEET

ALL FUND GROUPS

2

B COMBINED STATEMENT OF CHANGES IN FUND BALANCES

ALL FUND GROUPS

4

C STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES,

AND OTHER CHANGES

6

D NOTES TO THE FINANCIAL STATEMENTS

7

SUPPLEMENTARY INFORMATION

E COMBINING BALANCE SHEET

CURRENT FUNDS - UNRESTRICTED

20

F COMBINING STATEMENT OF CHANGES IN FUND BALANCES

CURRENT FUNDS - UNRESTRICTED

21

G COMBINING STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES,

AND OTHER CHANGES

UNRESTRICTED

23

SCHEDULES

1 SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

24

SCHEDULES OF REVENUES AND EXPENDITURES COMPARED TO BUDGET

2

RESIDENT INSTRUCTION

26

3

LOTTERY FOR EDUCATION

29

4 CHANGES IN INVESTMENT IN PLANT

30

5 SCHEDULE OF FUND BALANCES

CURRENT FUNDS AND PLANT FUNDS

32

6 RECONCILIATION OF SALARIES AND TRAVEL

34

GEORGIA SOUTIffiRN UNIVERSITY - TABLEOF CONTENTS -
SECTION II AUDITEE'S RESPONSE TO PRIORYEARFINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIORYEARFINDINGS 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
November 19, 1999

Honorable Roy E. Barnes, Governor Members of the General Assembly of Georgia Members of the Board ofRegents of the University System of Georgia
and Honorable Bruce F. Grube, President Georgia Southern University
INDEPENDENT AUDITOR'S COMBINED REPORT ON FINANCIAL STATEMENTS AND SupPLEMENTARY INFORMATION
Ladies and Gentlemen:
We have audited the accompanying financial statements (Exhibits A through D) of Georgia Southern University as of and for the year ended June 30, 1999. These financial statements are the responsibility of
the University's management. Ourresponsibility is to express an opinion on these financial statements based
on our audit.
We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial 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 described in Note 1 to the financial statements, Georgia Law and State budgetary policy require the University to prepare its financial statements on a basis which is not consistent with generally accepted accounting principles with respect to the recording of encumbrances as expenditures and liabilities. To conform with generally accepted accounting principles, encumbrances should be recorded as a reservation of fund balance. The effects on the financial statements ofthis departure from generally accepted accounting principles were not reasonably determinable, but are believed to be material.

99ARL-62

As disclosed in Note 1 to the financial statements, the University did not report the liability and related expenditure for compensated absences in the current funds as required by generally accepted accounting principles. Ifcompensated absences were reported, liabilities would be increased and fund balance would be decreased by $3,110,263.87 as of June 30, 1999, and the net change in fund balance for the year ended June 30, 1999, would be decreased by $ 1 2 3 , 6 6 8 . 8 9 . /
In our opinion, except for the effects on the financial statements of the matters discussed in the third and fourth paragraphs, the financial statements referred to above present fairly, in all material respects, the financial position of Georgia Southern University as ofJune 30, 1999, and the changes in fund balances and the current operating funds revenues, expenditures, and other changes for the year then ended in conformity with generally accepted accounting principles.
The year 2000 supplementary information on Schedule "1" is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries ofmanagement regarding the methods ofmeasurement and presentation ofthe supplementary information. However we did not audit the information and do not express an opinion on it. In addition, we do not provide assurance that Georgia Southern University is or will become year 2000 compliant, that the University's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Georgia Southern University does business are or will become year 2000 compliant.
Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying combining statements (Exhibits E through G) and the financial schedules (Schedules 2 through 6) are presented for purposes of additional analysis and are not a required part of the financial statements of Georgia Southern University. Such information has been subjected to the auditing procedures applied in the audit ofthe financial statements and, in our opinion, except for the effects ofthe matters discussed in the third and fourth paragraphs, such information is fairly presented in all material respects in relation to the financial statements taken as a whole.
Respectfully submitted,
~.rQW~ ~ll W. Hinton State Auditor
RWH:jb 99ARL-62

FINANCIAL STATEMENTS - 1-

GEORGIA SOUTHERN UNIVERSITY .COMBINED BALANCE SHEET ALL FUNDGROUPS JUNE30,1999

cash and CashEquivalents Investments Accounts Receivable Inventories Prepaid Items Duefrom Other FundGroups Investment in Plant
Total Assets
LIABILITIES AND FUNDBALANCES
Liabilities Accounts Payable Deferred Revenue Tuitionand Fees Deposits Held in Custodyfor Others Dueto Other Fund Groups capital Lease Obligations
Total Liabilities
Fund Balances U, S. Government GrantsRefundable Institutional Loans- Restricted Endowment Net Investment in Plant Restricted Unrestricted
Total FundBalances
Total Liabilities and FundBalances

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

LOAN FUNDS

$

11,582,766.24 $

6,480,95

1,299,598,55

1,881,670.33

1,481,151.55

53,952.77

200,231.76 $ 658,956,88

173,805,92 2,840,431.76

$

16,305,620.39 $

859,188,64 $ _ _.3.,.0..1,;"4,;,;,;;2; 37,_68_

$

5,032,441.59 $

4,606,827,40

$

9,639,268,99 $

$

$

6.666.351.40

$

6,666,351,40 $

4,145,21

53,952,77

58,097.98

$

2,964,786,06

49,451.62

801,090.66

801,090.66 $

3,014,237,68

$

16,305,620.39 $

859,188,64 $

3,014,237.68

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

EXHIBIT "A"

ENDOWMENT FUNDS

UNEXPENDED

PLANTFUNDS RENEWALS AND REPLACEMENTS

INVESTMENT IN PLANT

AGENCY FUNDS

TOTAL (Memorandum
Only)

$

2,200,716.91 $

2,112,624.24 $

1,794,530.39

$

2,280,106.87 $

20,344,782.33

6,480.95

780,840.56

15,239.43

162,874.16

5,757,941.34

1,881,670.33

1,481,151.55

53,952.n

$ 219,225,655.03

219,225,655.03

$

2,200,716.91 $

2,893,464.80 $

1,809,769.82 $ 219,225,655.03 $

2,442,981.03 $ 248,751,634.30

$

2,891,750.60 $

$

2,891,750.60 $

442,999.31
$ 442,999.31 $

$
119,151.06 119,151.06 $

1,878,081.39 $ 564,899.64
2,442,981.03 $

10,249,418.10
4,606,827.40 564,899.64 53,952.n 119,151.06
15,594,248.97

$

2,200,716.91

$

$

2,200,716.91 $

1,714.20 $ 1,714.20 $

$ 1,366,nO.51 1,366,nO.51 $

219,106,503.97 219,106,503.97

$

2,964,786.06

49,451.62

2,200,716.91

219,106,503.97

801,090.66

.8,034,836.11

$ 233,157,385.33

$

2,200,716.91 $

2,893,464.80 $

1,809,769.82 $ 219,225,655.03 $

2,442,981.03 $ 248,751,634.30

-3-

GEORGIA SOUTHERN UNIVERSITY COMBINED STATEMENT OF CHANGES IN FUNDBALANCES
ALL FUNDGROUPS YEAR ENDEDJUNE 30, 1999

REVENUES AND OTHERADDITIONS
Unrestricted CurrentFundRevenues State Appropriations
Regular Federal Grantsand Contracts State Grantsand Contracts Local Grantsand Contracts PrivateGifts,Grants,and Contracts Investment Income
Endowment Other Net Decreasein FairValueof Investments Intereston Loans Receivable Adjustments PriorYears' Expenditures/Accounts Payable Prior Years' ChecksVoided Expended for Plant Facilities CurrentFunds Plant Funds
Unexpended Renewals and Replacements GeorgiaState Financing and Investment Commission OtherAdditions Proceeds from Sale of Plant Assets Recovery of Prior Years'cancelled Loans
Total Revenues and OtherAdditions
EXPENDITURES AND OTHERDEDUCTIONS
Educational and GeneralExpenditures AuxiliaryEnterprises Expenditures IndirectCosts Recovered Remittances to the Boardof Regents of the
UniversitySystemof Georgia Prior Year's Unrestricted FundBalance(Surplus)
Adjustments Prior Years'Revenues/Accounts Receivable
Loancancellations and Write-Offs Administrative and Collection Costs Expended for Plant Facilities
capitalized Noncapitalized DisposalslDeletions/Adjustments
Total Expenditures and OtherDeductions
TRANSFERS BETWEENFUNDS
Nonmandatory Renewals and Replacements capital Projects
Total TransfersBetween Funds
Net Increasel(Decrease) for the Year
FUNDBALANCES JULY 1.1998

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

LOAN FUNDS

$ 124,642,120.13

$

46,526,916.45 $

9,988,040,95

n2,603.52

337,378,69

64,919.98

-2,984,86

103,002,12 8,407.48

1,849.00 616.00
2,549.94 46,505,92

$ 124,753,529.73 $

57,686,874.73 $

$ 105,n4,393.45 $ 16,378,n5,78

57,380,095,84 311,960.15

51,065,28
21,399,96 $

35,399.00 88,919.86
40,589,53 22,722,12

$ 122,225,634.47 $

57,692,055.99 $

63,311,65

$

-1,110,706,51

-821,954.00

$

-1,932,660,51

$

595,234.75 $

6,071,116.65

-5,181.26 $ 806,271.92

25,608.21 2,988,629.47

FUNDBALANCES JUNE 30.1999 The notesto the financialstatements are an integralpart of this statement.

$ -4-

6,666,351.40 $

801,090.66 $

3,014,237,68

EXHIBIT"B"

ENDOWMENT FUNDS

UNEXPENDED

PLANT FUNDS RENEWALS AND REPLACEMENTS

INVESTMENT IN PLANT

TOTAL (Memorandum
Only)

$

4,282,000.00

39,765.53

348.92

197,687.00

$

-22,227.41

797,048.06

62.00 $

16,674.89

$

-22,227.41 $

5,333,586.40 $

$ 573.00
573.00 $

$
125,576.30
6,447,001.06 5,876,157.59
716,782.58 15,128,127.45 28,293,644.98 $

124,642,120.13
4,282,000.00 46,568,530.98
9,988,389.87 772,603.52 661,257.99
64,919.98 799,598.00 -25,212.27 48,505.92
103,637.12 8,407.48
6,447,001.06
5,876,157.59 716,782.58
15,128,127.45
16,674.89 35,399.00
216,134,901.29

$

0.00

$ 163,154,489.29 16,378,775.78 311,960.15

51,065.28

$

490.45

21,890.41 40,589.53 22,722.12

5,876,157.59 $ 286,654.01

716,782.58 47,776.83
$

2,625,252.08

6,592,940.17 334,430.84
2,625,252.08

$

0.00 $

6,163,302.05 $

784,559.41 $

2,625,252.08 $ 189,534,115.65

$

$

$

-22,227.41 $

2,222,944.32

$

2,200,716.91 $

$ 821,954.00 821,954.00 $
-1,761.65 $ 9,475.85

1,110,706.51
1,110,706.51 346,720.10 $
1,020,050.41

$
$ 25,668,392.90 $ 193,438,111.07

0.00 0.00 0.00 26,600,785.64 206,556,599.69

1,714.20 $

1,366,770.51 $ 219,106,503.97 $ 233,157,385.33

-5-

GEORGIA SOUTHERN UNIVERSITY STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES,
AND OTHER CHANGES . YEAR ENDED JUNE 30, 1999

EXHIBIT .C"

Net Increase/(Decrease) in Fund Balances

$

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

595,234.75 $

-6-

-5,181,26 $ ========5=9=0=,0=5=3=.=4=9=

GEORGIA SOUTHERN UNIVERSITY
NOTESTOTHEFmANC~STATEMENTS
JUNE 30. 1999

EXHIBIT"D"

NOTE 1; SUMMARy OF SIGNIFICANT ACCQUNTmG POLICIES
REPORTING ENTITY Georgia Southern University is one ofthirty-four (34) State supported member institutions ofhigher education in Georgia which comprise the University System of Georgia, an organizational unit of the State of Georgia. The accompanying financial statements reflect the operations of Georgia Southern University as a separate reporting entity.
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. Georgia Southern University does not have authority to retain unexpended State appropriations (surplus) for any given fiscal year. Accordingly, Georgia Southern University is considered an organizational unit ofthe Board ofRegents 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 ofRegents as defined in Section 2100 ofthe Governmental Accounting Standards Board Codification of Governmental Accounting and Financial Rc:morting Standards.
FUND ACCOUNTING In order to ensure observance of limitations and restrictions placed on the use of the resources available to the University, the accounts of the University are maintained in accordance with the principles of fund accounting. This is the procedure by which resources for various purposes are classified for accounting and reporting purposes into funds that are in accordance with activities or objectives specified. Separate accounts are maintained for each fund; however, in the accompanying financial statements, funds that have similar characteristics have been combined into fund groups. Accordingly, all financial transactions have been recorded and reported by fund group.
Within each fund group, the University's fund balance allocations and designations represent those portions ofthe fund balances that are reserved, restricted and/or designated for specific future use by legal covenants, State policies, or institutional policies.
Fund groups and funds presented in the accompanying financial statements are as follows:
. CURRENT FUNDS
UNRESTRICTED - The fund used to account for those economic resources over which the University retains full control to use for purposes of performing the primary functions of the University, e.g., instruction, research, public service, etc.
RESTRICTED - The fund used to record externally restricted funds which may only be utilized in accordance with the purposes established by their source. Restricted current funds are recorded as revenues and expenditures when expended for current operating purposes.
-7-

GEORGIA SOUTHERN QNNERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1999

EXHIBIT"D"

NOTE 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES

FUND ACCOUNTING

LOAN FUNDS

The fund used to account for resources which have been made available for financial loans to students.

ENDOWMENT FUNDS

The fund used to account for gifts that are subject to the restrictions by the donor requiring that the principal be invested in perpetuity and income only be utilized.

PLANT FUNDS

UNEXPENDED - The fund used to account for financial resources utilized to acquire or to construct physical properties for institutional purposes.

RENEWALS AND REPLACEMENTS - The fund used to account for resources set aside for the renewal and replacement ofinstitutional properties.

INVESTMENT IN PLANT - The fund which shows the total amounts representing the book value of all physical properties owned by the University. Net Investment in Plant is an equity account showing the total book value of physical properties belonging to the University less the amount of any indebtedness to others.

AGENCY FUNDS

The fund used to account for resources held by the University as custodian or fiscal agent for individual students, faculty, staffmembers, and organizations.

BASIS OF ACCOUNTING

accrual Except as otherwise disclosed in these notes, the financial statements are prepared on the modified accrual

basis ofaccounting, which is materially the same as the

basis of accounting applicable to colleges and

universities prescribed in the American Institute ofCertified Public Accountants' audit guide reporting model.

The modified accrual basis ofaccounting is defined as that method ofaccounting in which expenditures, other

than accrued interest on generallong-tenn debt, are recorded at the time liabilities are incurred and revenues

are recorded when available and measurable to finance expenditures of the fiscal period.

Contractual obligations for goods and services which have not been received at the end of the fiscal year are recognized as expenditures and liabilities in the accompanying financial statements. This accounting practice causes expenditure-driven grant revenues to be accrued based, in part, on the unexecuted portion of contracts for goods and services. The recognition of'encumbrances as expenditures and liabilities is in conformity with

-8-

GEORGIA SOUTHERN UNNERSITY
NOTES TO THE FINANCIAL STATEMENTS . JUNE 30. 1999

EXHIBIT "D"

NOTE 1; SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but is not consistent with generally accepted accounting principles, which provide for the recording of encumbrances as a reservation of fund balance. Further, revenue recognition for expenditure-driven grants should be based upon expenditures determined in accordance with generally accepted accounting principles.
Compensated absences represent obligations of the University relating to employees' rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulated annual leave in which payment is probable and can be reasonably estimated. The compensated absences liability of$3,110,263.87 and a related net current year expenditure of$123,668.89 have not been reported in the current funds as required by generally accepted accounting principles.
Prior period adjustments and certain other items are reported as additions to and deductions from fund balances of current funds in the accompanying financial statements. This presentation is in accordance with accounting practices prescribed or permitted by statutes and regulations ofthe State of Georgia, but differs from generally accepted accounting principles in that immaterial adjustments should be reported as current period revenues and expenditures. The effect of this departure is deemed to be immaterial to the fair presentation of the financial statements.
To the extent that Current Funds and Plant Funds are used to finance plant assets, the amounts so provided are accounted for as expenditures. The balances shown on the Combined Balance Sheet as Net Investment in Plant reflect the accumulated expenditures made for plant facilities through Current Funds and Plant Funds and also include expenditures made for plant facilities expended by the Georgia State Financing and Investment Commission on behalf ofthe University. Donated fixed assets are recorded at fair market value on the date donated. Disposals are deleted at recorded values. No depreciation has been provided on physical plant and equipment.
The Statement of Current Funds Revenues, Expenditures, and Other Changes is a statement of financial activities of current funds related to the current reporting period. It does not purport to present the results of operations or the net income or loss for the period as would a statement of income or a statement ofrevenues and expenses.
BUDGET The Board of Regents of the University System of Georgia - Administrative Central Office receives State appropriation allotments for units ofthe University System of Georgia. The appropriated budget is adopted at the Board level and represents appropriations provided by the Amended Appropriations Act of 1998-1999. The appropriated budget covers current funds and plant funds, except for Auxiliary Enterprises and Student Activities which are not subject to appropriation. The allocation of the appropriated budget is made to the College by the Administrative Central Office. In addition, the College receives Federal funds and other funds directly and includes these funds in the budget filed with the Administrative Central Office.

-9-

GEORGIA SOUTHERN UNNERSITY
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1999

EXHIBIT "0"

NOTE 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES

BUDGET A comparison of anticipated funds available and budgeted expenditures by budget unit object class indicates that the following object class was overspent by the amount identified below:

Resident Instruction Year 2000 Project

$ 13.948.00

This overexpenditure ofbudget constitutes a violation of Board ofRegents policy, but does not constitute a statutory violation of budget authority. Statutory violations of budget authority are reported at the Board object class level.

CASH AND CASH EQUIVALENTS

.

Cash and Cash Equivalents consist of petty cash, demand deposits, certificates of deposit and temporary

investments in authorized financial institutions, and cash management pools that have the general

characteristics of demand deposit accounts.

INVESTMENTS Investments are reported at fair value. Funds received by the University as endowments or for restricted purposes are invested according to conditions stipulated by the donor, grantor, or in accordance with the Board ofRegents authorizing resolutions. Gains and losses on investment transactions are accounted for in the funds where such assets are recorded.

ACCOUNTS RECEIVABLE Accounts receivable consist of allotments due from the Board of Regents of the University System of Georgia - Administrative Central Office, reimbursements due from Federal, State, local, and private grants and contracts, and other receivables disclosed from information available. No provision has been made for an allowance for doubtful accounts within the accompanying financial statements.

INVENTORIES Inventories of consumable supplies are recorded on the consumption method and are valued at cost on the Combined Balance Sheet using the weighted average method.

Inventories of goods for resale are valued at cost using the first-in, first-out method.

PREPAID ITEMS Prepaid items are payments made to vendors in advance ofthe receipt ofgoods and services that will benefit periods subsequent to the balance sheet date.

MEMORANDUM ONLY - TOTAL COLUMNS The total columns on the financial. statements are captioned "Memorandum Only" because they do not represent consolidated financial information and are presented only to facilitate financial analysis. The columns do not present information that reflects financial position or changes in financial position in

-to -

GEORGIA SOUTHERN UNNERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1999

EXHIBIT "D"

NOTE 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
MEMORANDUM ONLY - TOTAL COLUMNS conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds belonging to the State of Georgia cannot be placed in a depository paying interest longer than ten days without the depository providing a surety bond to the State. In lieu of a surety bond, the depository may pledge as collateral anyone or more ofthe following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59:
(1) Bonds, bills, certificates ofindebtedness, notes, or other direct obligations of the United States or of the State of Georgia.
(2) Bonds, bills, certificates of indebtedness, notes, or other obligations of the counties or municipalities of the State of Georgia.
(3) Bonds of any public authority created by the laws ofthe State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose.
(4) Industrial revenue bonds and bonds ofdevelopment authorities created by the laws of the State of Georgia.
(5) Bonds, bills, certificates of indebtedness, notes, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest, or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
(6) Guarantee or insurance of accounts provided by the Federal Deposit Insurance Corporation.
As authorized in the Official Code of Georgia Annotated Section 50-17-53, the State Depository Board has adopted policies which allow agencies of the State of Georgia (which includes organizational units of the Board of Regents of the University System of Georgia) the option of exempting demand deposits from the collateral requirements.
The treasurer of the Board of Regents is responsible for all details relative to furnishing the required depository protection for all units of the University System of Georgia.

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GEORGIA SOUTHERN UNNERSITY
NOTES TO THE FINANCIAL STATEMENTS ruNE 30. 1999

EXHIBIT "D"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS

CATEGORIZATION OF DEPOSITS For purposes of analysis of custodial credit risk, cash deposits consist of all bank balances which include demand deposits and/or interest bearing accounts. The bank balances as of June 30, 1999, are categorized below in order to provide information about the extent to which such deposits are exposed to custodial credit risk:

Category 1 - Amounts covered by depository insurance or collateralized with securities (at fair value) held by the University or by its agent in the University's name.

Category 2 - Amounts collateralized with securities (at fair value) held by the pledging financial institution's trust department or agent in the University'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 University's name, and amounts uncollateralized.

Total Cash Deposits

Carrying Amount

Bank Balances

Risk Categories

2

3

$ 18,016,732.63 $ 21.544.429.58 $ 500,000.00 $ 21.044.429.58 $=====0.0=0

CATEGORIZATION OF INVESTMENTS The carrying amounts of investment balances as of June 30, 1999, are categorized below:

T)!pe of Investment
Board ofRegents Short-Term Investment Fund Total Return Fund
Life Insurance Policy (Cash Surrender Value)
Total Investments

Carrying Amount
$ 73,915.93 2,103,796.02 6.480,95
$ 2.184,192,90

Funds invested in an investment pool managed by another governmental entity are not required to be categorized since the University did not own any specific, identifiable investment securities of the pool.

NOTE 3: INVESTMENT IN PLANT

The following is a summary of Investment in Plant fixed assets as of June 30, 1999:

-12 -

GEORGIA SOUTHERN UNNERSITY
NOTES TO THE FINANCIAL STATEMENTS
ruNE 30. 1999

EXHIBIT "D"

NOTE 3: INVESTMENT IN PLANT

Land Buildings Improvements Other Than Buildings Equipment Library Books and Collections

$ 1,862,841.20 147,834,563.63 8,062,550.89 37,795,260.96 23.670.438.35

Total Investment in Plant

$219.225.655.03

NOTE 4: CAPITAL LEASES

Georgia Southern University acquires certain equipment through multi-year capital leases with varying terms and options. These agreements contain fiscal funding clauses in accordance with Official Code of Georgia Annotated Section 50-5-64 which prohibits the creation of a debt to the State of Georgia for the payment of any sums under such agreements beyond the fiscal year of execution if appropriated funds are not available. Ifrenewal of such agreements is reasonably assured, however, capital leases requiring appropriation by the General Assembly of Georgia are considered noncancellable for financial reporting purposes.

As of June 30, 1999, future minimum lease payments under capital leases are as follows:

Fiscal Year Ending June 30

2000 2001 2002 2003

$ 61,764.90 44,651.69 16,754.42 6.765.24

Total Future Minimum Lease Payments

$ 129,936.25

Less: Amounts Representing Interest

10.785.19

Present Value of Future Minimum Lease Payments

$ 119.151.06

NOTE5: RISKMANAGEMENT

Georgia Southern University is a participant in the Board of Regents of the University System of Georgia Health Benefits Plan, which is a self-insurance program of health and dental benefits for employees and retirees of the University System of Georgia. The University and participating employees and retirees pay premiums to the Health Benefits Plan for this health insurance coverage. The Health Benefits Plan is included in the financial statements of the Board of Regents of the University System of Georgia - Administrative Central Office. All units ofthe University System of Georgia share the risk of loss for claims of the Health Benefits Plan. The Health Benefits Plan is considered a self-sustaining risk fund that provides health

- 13 -

GEORGIA SOUTHERN UNNERSITY
NOTES TO THE FINANCIAL STAIEMENTS ruNE 30. 1999

EXHIBIT"D"

NOTE 5: RISK MANAGEMENT
coverage for its members up to a maximum lifetime benefit of$I,OOO,OOO.OO per person and dental coverage up to an annual maximum of$I,OOO.OO per person. The Board of Regents has contracted with Blue Cross Blue Shield of Georgia to process claims in accordance with the Health Benefits Plan as established by the Board ofRegents.
The Department ofAdministrative Services (DOAS) has the responsibility for the State ofGeorgia ofmaking and carrying out decisions that will minimize the adverse effects of accidental losses that involve State government assets. The State believes it is more economical to manage its risks internally and set aside assets for claim settlement. Accordingly, DOAS processes claims for risk of loss to which the State is exposed, including general liability, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' indemnification. Limited amounts of commercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks. The University, as an organizational unit ofthe Board ofRegents ofthe University System of Georgia, is part ofthe 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.
NOTE6: RETIREMENIPLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA
Plan -Description Georgia Southern University participates in the Teachers Retirement System ofGeorgia (IRS), 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. IRS 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 ofAudits and Accounts.
Funding Policy Employees ofthe University who are covered by IRS are required by State statute to contribute 5% of their gross earnings to TRS. The University makes monthly employer contributions to TRS at rates adopted by the IRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. For fiscal year 1999, the employer contribution rate was 11.95% for covered employees. In addition, the

- 14-

GEORGIA SOUTHERN UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 30.1999

EXHIBIT "0" .

NOTE6: RETllWMENIPLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA

Funding Policy University contributed 3.46% to the TRS on behalf of employees electing to participate in the Regents Retirement Plan. Employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1999 1998 1997

100% 100% 100%

$ 5,854,070.94 $ 5,717,519.28 $ 5,529,928.17

REGENTS RETIREMENT PLAN

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

Funding Policy Member contribution requirements are established by the Board of Trustees of the Teachers Retirement System. Employer contributions are established by statute and may be amended only by the General Assembly ofthe State of Georgia. The employer contributes 8.34% ofthe participating employee's earnable compensation. Employees contribute 5% oftheir earnable compensation. Amounts attributable to all plan contributions are fully vested and non-forfeitable at all times.

The University and the covered employees made the required contributions of$I,861,603.61 (8.34%) and $1,129,680.87 (5%), respectively.

GEORGIA DEFINED CONTRIBUTION PLAN

Plan Description Georgia Southern University participates in the Georgia Defined Contribution Plan (GDCP) which is a singleemployer defined contribution plan established bythe 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.

- 15-

GEORGIA SOUTHERN UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS . ruNE 30. 1999

EXHIBIT "D"

NOTE 6: RETIREMENT PLANS
GEORGIA DEFINED CONTRIBUTION PLAN
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 ofTrustees. Ifa member has less than $ 3,500.00 credited to his/her account, the Board of Trustees has the option ofrequiring a lump sum distribution to the member in lieu ofmaking 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.
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 ofTrustees. 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 1999 amounted to $140,235.80 which represents 7.5% of covered payroll. These contributions met the requirements ofthe plan.
NOTE 7: LEAVEPOUCffiS
Employees earn annual leave ranging from one and one-quarter days to one and three-quarter days each month depending upon the employees' length of continuous State service with maximum accumulation of forty-five days. Employees are paid for unused accumulated annual leave upon retirement or termination of employment. See Note 1 - Basis of Accounting (Compensated Absences)
Employees earn one day of sick leave each month with no maximum accumulation established. Unused accumulated sick leave does not vest with the employee and is forfeited upon retirement or termination of employment, except as noted in the subsequent paragraph.
Certain employees who retire with a minimum ofthree months ofunused sick leave are entitled to additional service credit in the Teachers Retirement System of Georgia.
NOTE 8: CONTINGENCffiS
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 ofexpenditures which may be disallowed by the grantor cannot be determined at this time although the University expects such amounts, if any, to be immaterial to its overall financial position.

- 16-

GEORGIA SOUTHERN UNNERSITY
THE NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1999

EXHIBIT"D"

NOTE 8: CONTINGENCrnS

Litigation, claims and assessments filed against Georgia Southern University (an organizational unit of the Board ofRegents ofthe 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, 1999.

NOTE 9: POSTEMPLOYMENT BENEFITS OTHER THAN PENSION BENEFITS

Pursuant to the general powers conferred by the Official Code of Georgia Annotated Section 20-3-31, the Board of Regents of the University System of Georgia has established group health and life insurance programs for regular employees ofthe University System of Georgia It is the policy ofthe Board ofRegents to permit employees ofthe University System of Georgia eligible for retirement or that become permanently and totally disabled to continue as members ofthe group health and life insurance programs. Employees who are eligible for retirement or disability under the criteria established by the Teachers Retirement System of Georgia and who have at least ten years ofservice with the University System ofGeorgia are eligible for these postemployment health and life insurance benefits. Organizational units of the Board of Regents of the University System of Georgia pay the employer portion for group insurance for affected individuals.

As of June 30, 1999, there were 413 employees who had retired or were disabled that were receiving these postemployment health and life insurance benefits. For the year ended June 30, 1999, Georgia Southern University recognized as incurred $620,285.07 of expenditures, which was net of$198,785.30 ofparticipant contributions..

NOTE 10: ENROLLMENT

The equivalent full-time student enrollment of Georgia Southern University was as follows:

Regular Term . Fall Semester, 1998 Spring Semester, 1999

11,713 10,970

Average

11.342

Summer School, 1998

3,696

- 17-

SUPPLEMENTARY INFORMATION -19 -

GEORGIA SOUTHERN UNIVERSITY COMBINING BALANCE SHEET
CURRENT FUNDS - UNRESTRICTEP JUNE 30, 1999

EXHIBIT "I:"

~ cash and cash Equivalents Investments Accounts Receivable Inventories Prepaid Items Due from Other Fund Groups
Total Assets

RESIDENT INSTRUCTION

LOTTERY FOR EDUCATION

AUXILIARY ENTERPRISES

STUDENT ACTIVITIES

TOTAL

$ 6,001,335,80 $
420,112.74 247,728.06 1,397,856.18
53,952.n

176,148.72 $

4.402,028,25 $
6,480,95 878,721,81 1,633.942,27
82.685,37

1,003,253,47 $
764.00 610.00

11,582,766,24 6,480,95
1,299,598,55 1,881,670,33 1,481,151.55
53,952,77

$ 8,120,985,55 $

176,148.72 $ 7,003.858,65 $ 1,004,627.47 $ 16,305,620.39

LIABILITIES AND FUND BALANCES
Liabilities Accounts Payable Deferred Revenue Tuition and Fees
Total Llabflities
Fund Balances Unrestricted

$ 4,420,727.79 $ 3,318,n8,21
$ 7,739,506,00 $
381,479.55

175,733.37 $

205,123.39 $

1,113,493.44

175,733,37 $ 1,318,616,83 $

415.35

5,685,241.82

230,857,04 $ 5,032,441,59

174,555,75

4,606,827.40

405,412,79 $ 9,639,268.99

599,214.68

6,666,351.40

Total liabilities and Fund Balances

$ 8,120,985.55 $

176,148.72 $ 7,003,858.65 $ 1,004,627.47 $ 16,305,620,39

See notes to the f1nanclal statements,

-20 -

GEORGIASOUTHERN UNIVERSITY COMBINING STATEMENT OF CHANGES IN FUNDBALANCES
CURRENT FUNDS - UNRESTRICTED YEAR ENDED JUNE30. 1999

EXHIBIT"P

REVENUES AND OTHERADDITIONS
Unrestrlded Current Fund Revenues Adjustments
Prior Years' expenditures/Accounts Payable Prior Years' Checks Voided
Total Revenuesand Other Additions
EXPENDITURES AND OTHERDEDUCTIONS
Educational and Generalexpenditures AuxIliaryEnterprisesexpenditures Remittances to the Boardof Regentsof the
UniversitySystem of Georgia Prior Year's Unrestrided Fund Balance (Surplus)
Adjustments Prior Years' Revenues/Accounts Receivable
Total expendituresand Other Deductions
TRANSFERS BETWEENFUNDS
Nonmandatory Renewals and Replacements Capital Projeds In Lieu of State Appropriations
Total TransfersBetween Funds
Net Increasel(Decrease) for the Year
FUNDBALANCES JULY 1, 1998

RESIDENT INSTRUCTION

LOTTERYFOR EDUCATION

AUXILIARY ENTERPRISES

STUDENT ACTIVITIES

TOTAL

$ 101.331,908.79 $
61,601.17 8,407,48
$ 101,401.917.44 $

615,000.00 $ 19,815.767.09 $ 7.796.71
615,000.00 $ 19.823,563,80 $

2,879,444,25 $ 124.642.120.13

33.604.24

103,002,12 8,407.48

2,913,048.49 $ 124,753,529,73

$ 103,048,659.67 $

614,584.65

$

$ 16,378,n5.78

2,111,149.13 $ 105,n4.393.45 16.378,n5.78

51,065.28 24,163,57

736.39

-3,500,00

51,065.28 21,399.96

$ 103,123,888,52 $

614,584.65 $ 16,379,512.17 $ 2,107,649,13 $ 122,225,634.47

$ 1,691,927,00

$ 1,691,927.00

$

-30,044.08 $

411,523.63

$ -1,110,706,51 -768,095.00 $
-1,014,809,00

$ -2,893,610.51 $

415.35 $

550,441,12 $

0.00

5,134,800,70

$ -53,859.00 -en,118.00

-1,110,706,51 -821,954.00 0.00

-730,9n.00 $ -1,932,660.51

74,422.36 $

595,234,75

524,792,32

6,071,116,65

FUNDBALANCES JUNE 30. 1999

$

381,479.55 $

415.35 $ 5,685,241.82 $

599,214.68 $ 6,666,351,40

see notesto the financialstatements.

- 21

GEORGIA SOUTHERN UNIVERSITY COMBINING STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES
AND OTHER CHANGES UNRESTRICTED
YEAR ENDED JUNE 30, 1999

EXHIBIT"G"

REVENUES
State Appropriations Tuition and Fees Federal Grants and Contracts State Grants and Contracts Local Grants and Contracts Sales and Services of Educational Activities Sales and Services of AuxDiary Enterprises Other Sources
Total Revenues
EXPENDITURES
Educational and General Instruction Research Public Service Academic Support Student Services Institutional Support Operation and Maintenance of Plant Scholarships and Fellowships
AuxUiary Enterprises Student Housing Food Services Stores and Shops Intercollegiate Athletics Other Service Units
Total Expenditures
OTHER TRANSFERS AND ADDITIONSIIDEDUCTIONSI
Transfers for Renewals and Replacements Transfers for Capital Projects Transfers in Lieu of State Appropriations Prior Period Adjustments (Net) Remittances to the Board of Regents
of the University System of Georgia Prior Year's Unrestricted Fund Balance (SurplUS)
Total Other Transfers and Additions/(Deductions)

RESIDENT INSTRUCTION

LOTTERY FOR EDUCATION

AUXILIARY ENTERPRISES

STUDENT ACTIVITIES

TOTAL

$ 69,115,925.00 $ 30,244,294,76 300,619,42 24,383,56 2,991,83 1,474,976,14
168,718,08
$ 101,331,908,79 $

615,000.00 $

2,993,271.08 $

16,466,160.43 356,335.58
615,000.00 $ 19,815,767.09 $

$ 2,487,426,55
392,017.70

69,730,925.00 35,724,992.39
300,619,42 24,383.56 2,991,83
1,474,976.14 16,466,160.43
917,071.36

2,879,444.25 $ 124,642,120.13

$ 52,861,621.58 $ 658,576.19 625,638,40
11,103,824,82 6,481,689.09
16,616,981.74 12,571,694,10
2,128,633,75
$ 103,048,659,67 $

613,728,08
856,57 $
$ 4,418,851.54 3,082,110,88 1,330,907.48 5,122,241,21 2,424,664.67
614,584.65 $ 16,378,775.78 $

$ 2,111,149.13

53,475,349,66 658,576.19 625,638.40
11,104,681,39 8,592,838.22
16,616,981.74 12,571,694,10
2,128,633.75

4,418,851,54 3,082,110,88 1,330,907.48 5,1t2,241.21 2,424,664.67

2,111,149,13 $ 122,153,169.23

$
$ 1,691,927,00 45,845,08

0,00 $

-1,110,706.51 -768,095,00 $
-1,014,809,00 7,060,32

$ -53,859,00 -677,118,00 37,104,24

-1,110,706,51 -821,954.00 0.00 90,009.64

-51,065,28 $ 1,686,706.80 $

-51,065.28

0,00 $ -2,886,550.19 $

-693,872.76 $ -1,893,716.15

Net Increasel(Decrease) in Fund Balances

$

-30,044.08 $

415.35 $

550,441.12 $

74,422,36 $

595,234.75

See notes to the financial statements,

-23-

GEORGIA SOUTHERN UNIVERSITY

SCHEDULE "1"

SCHEDULE OF REQUIRED SupPLEMENTARY INFORMATION

YEAR 2000 DISCLOSURES

YEAR ENDED JUNE 30. 1999

The year 2000 issue is the result of shortcomings in many electronic data processing systems and other electronic equipment that may adversely affect the University's operations beyond calendar year 1999.

Georgia Southern University is a member ofthe University System of Georgia. As such, most ofthe mission critical systems of the institution are supported by the central office of the Board of Regents - Office of Information and Instructional Technology. Georgia Southern University however, had not assessed computer systems and other equipment not supported by the central office as ofJune 30, 1999. Subsequent to June 30, 1999, the University assigned the duty of identifying, reporting and remediating year 2000 issues to a task . force comprised of Information Technology professionals and department managers. The task force is managed and coordinated by the Assistant Director ofComputer Services - Technical Support. The following stages have been identified as necessary to implement year 2000 compliant systems.

Awareness Stage - Encompasses establishing a budget and project plan for dealing with the year 2000 Issue.

Assessment Stage - The actual process ofidentifying all systems and individual components ofsystems to check for compliance.

Remediation Stage - The time when changes are made to systems and equipment.

Validation/Testing Stage - The process of ensuring that the changes made to systems and equipment will produce a year 2000 compliant system.

It will be necessary for the University to progress through all four of these stages for each computer and/or electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversely affected.

The status ofyear 2000 issues for mission critical systems operated by the University are as follows:

Systems Supported by Board of Regents

The College and University Fund Accounting System has been remediated, validated and tested.

The Regents Budget Reporting System is reportedly year 2000 compliant. The awareness, assessment and validation/testing phases were completed in 1997.

The Regents Payrol1/Personnel System has been remediated, validated and tested.

The Regents Property Inventory System is reportedly year 2000.compliant. The awareness, assessment and

validation/testing phases were completed in 1997.

.

See notes to the financial statements.

-24-

GEORGIA SOUTHERN UNNERSITY

SCHEDULE "1"

SCHEDULE OF REQUJRED SupPLEMENTARY INFORMATION

.YEAR 2000 DISCLOSURES

YEAR ENDED ruNE 30, 1999

The Banner Student Information System is supported by SCT Banner, Inc. Their year 2000 version has been released and distributed to the University.
Systems Supported by Georgia Southern University
The Physical Plant Division is responsible for the operation and maintenance of all physical facilities on the University campus. Compliant systems include the environmental command and control systems, utility monitoring system, elevator and fire alarm systems and chiller and individual control panels. Physical Plant work order system and maintenance contract management systems are year 2000 compliant.
University Public Safety dispatch system hardware and software was identified as non-compliant. Both hardware and software have been replaced with year 2000 compliant systems. Testing and certification as Y2K compliant is scheduled for September 1999.
Program of institutional operating systems in support ofthe student information system and financial systems were upgraded and final testing is scheduled for September 1999.
Twenty-six (26) of the University's servers utilized for networking and data communications are year 2000 compliant. Twelve (12) servers and seven (7) network control systems have been upgraded to be compliant. Testing and certification as Y2K compliant is scheduled for September 1999.
The workstations have been either replaced or upgraded to be Y2K compliant. Testing and certification as Y2K compliant.is schedule for September 1999.

See notes to the financial statements.

- 25-

GEORGIA SOUTHERN UNIVERSITY SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET
RESIDENT INSTRUCTION YEAR ENDEDJUNE30.1999

REVENUES
State Appropriations OtherRevenues Retained

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

PLANT FUNDS

RENEWALS AND

UNEXPENDED

REPLACEMENTS

$

69,115,925.00

$

32,215,983.79 $ _ _-.5;7;,.3:8~0=,0=9,5,.;8.4,.

4,282,000.00 $ 1,051,524.40

0.00

$

101,331,908.79 $

57,380,095.84 $

5,333,524.40 $

~ 0.~ 00

EXPENDITURES

PersonalServices:

Education, Generaland Departmental Services

$

Sponsored Operations

OperatingExpenses:

Education, Generaland Departmental Services

Sponsored Operations

CapitalOutlay

SpecialFunding Initiative

Research Consortium

Year2000 Project

78,360,760.20 $
21,990,572.47
2,673,129.00 10,250.00 13,948.00

1,829,445.63
55,550,650.21 $

6,162,811.60 $

764,559.41

$

103,048,659.67 $

57,380,095.84 $

Excessof Revenues over,Expenditures

$

-1,716,750.88 $

0.00 $

(1) To eliminatetuitionwaiversnot budgeted andto reclassify currentyear
transfersand prioryear fund balancesbudgeted as revenues.

6,162,811.60 $ -829,287.20 $

764,559.41
_Iiioi= -76..4..,.5.59.41

See notesto the financialstatements.

-26-

SCHEDULE .X'

TOTAL

ADJUSTMENTS (1)

TOTAL (BudgetBasis)

BUDGET

VARIANCEFAVORABLE (UNFAVORABLE)

$

73,397,925.00

$

73,397,925.00 $ 73,397,925.00 $

0.00

90,647,604.03 $ _--:1.,1J4=9,:8=06=.66;"

91,797,410.69

115,750,290.00

-23,952,879.31

$

164,045,529.03 $

1,149,806.66 $ . 165,195,335.69 $ 189,148,215.00 $ _--:;;-=2=3;,9.;5.,2,,;8;,7;9;;..3.;1...

$

78,360,760.20

1,829,445.63

$

78,360,760.20 $ 78,684,296.00 $

1,829,445.63

3,015,331.00

323,535.80 1,185,885.37

21,990,572.47 $ 55,550,650.21 6,927,371.01 2,673,129.00
10,250.00 13,948.00

-2,128,633.75

19,861,938.72 55,550,650.21
6,927,371.01 2,673,129.00
10,250.00 13,948.00

21,258,540.00 74,984,669.00
8,522,000.00 2,673,129.00
10,250.00 0.00

1,396,601.28 19,434,018.79
1,594,628.99 0.00 0.00
-13,948.00

$ 167,356,126.52 $ -2,128,633.75 $ 165,227,492.77 $ 189,148,215.00 $ _--2= 3,9=20~,7. 22= .23~

$

-3,310,597.49 $ 3,278,440.41 $

-32,157.08

$ _ _...,-;3.2.,.1.5.7..0_8

-27 -

GEORGIASOUTHERN UNIVERSITY SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET
LOTIERY FOR EDUCATION YEAR ENDEDJUNE 30, 1999

SCHEDULE "3"

REVENUES State Appropriations

CURRENTFUNDS UNRESTRICTED

BUDGET

NARIANCEFAVORABLE (UNFAVORABLE)

$

615,000,00 $

615,000.00 $

~ 0.~ 00

EXPENDITURES
Equipment, Technology and Construction Trust Fund
Special Funding Initiatives

$

456,584.65 $

457,000.00 $

158,000.00

158,000.00

$

614,584.65 $

615.000.00 $

415.35 0.00
--:.4..1;5.:.;3.;5,~

Excess of Revenues over Expenditures

$=====4=15=.3=5

See notes to the financial statements.

-29 -

Land Buildings Improvements Other Than Buildings Equipment Library Books and Collections
SUMMARY OF INVESTMENT University capital Leases

GEORGIA SOUTHERN UNIVERSITY CHANGES IN INVESTMENT IN PLANT . YEAR ENDED JUNE 30. 1999

BALANCE JULY 1,1998

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

pLANT UNEXPENDED

$

1,862,841.20

127,991,598.02

$

4,286,378.40

6,820,008.20

1,242,542.69

34,452,287.71 $

5,019,833.66 $

239,320.69

347,236.50

22,482,591.64

1,187,846.71

$ 193,609,326.n $

6,207,680.37 $

=========.......... 239,320.69 $ ='

5,876,157.59

$ 193,438,111.07 $
171,215.70

6,207,680.37 $

239,32Q.69 $

5,876,157.59

$ 193,609,326.n $

6,207,680.37 $

239,320.69 $ ====5,~87~6,=15=7.=59=

See notes to the financial statements.

-30-

SCHEDULE "4"

ADDITIONS
FUNDS RENEWALS AND REPLACEMENTS

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

648,113.76 $

14,908,473.45

68,668.82

s 219,654.00

CAPITAL LEASES
s 43,223.61

PRIVATE GIFTS

DEDUCTIONS DISPOSALS! DELETIONS! ADJUSTMENTS
s

~ BALANCE JUNE 30,1999
1,862,841.20

147,834,563.63

8,062,550.89

125,576.30 $

2,720,540.33

37,795,260.96

23,670,438.35

$

s 716,782.58

15,128,127.45 $

s 43,223.61

125,576.30 $

================ 2,720,540.33 $

219,225,655.03

$

s 716,782.58

15,128,127.45

$

s 125,576.30

2,625,252.08 $

219,106,503.97

- - - - - - $ - - - = = : ; . ; . . . 43,223.61

95,288.25

119,151.06

s

716,782.58 $

s 15,128,127.45

s 43,223.61

125,576.30 $

==. . . . 2,720,540.33 $

21~9;,;2,2;5;,,6:,5;5=.=0=3==

- 31

GEORGIA SOUTHERN UNIVERSITY SCHEDULE OF FUND BALANCES CURRENT FUNDS AND PLANT FUNDS
JUNE 30.1999

NET INVESTMENT IN PLANT Investment in Plant Facilities
RESTRICTED Designated for Subsequent Years' Expenditures
UNRESTRICTED Designated For Capital Projects (GSFIC) For Intercollegiate Athletics For Inventory Reserve For Renewals and Replacements Reserve For Subsequent Years' Expenditures For Uncollectible Accounts For Year 2000 Project SurpluslDeficlt Regular Lottery for Education

RESIDENT INSTRUCTION

CURRENT FUNDS

UNRESTRICTED

LOTTERY FOR

AUXILIARY

EDUCATION

ENTERPRISES

STUDENT ACTIVITIES

$

264,000.00

$

186,776.59

1,633,942.27

27,323.35 21,052.00

3,848,363.79 $ 16,159.17

598,450.68 784.00

69,104.20

- - - - - - $ ---_.:...:.=:4:1;:5;.3.:5..

$

381,479.55 $

415.35 $

5,685,241.82 $

..5.;9;.9;;.,=2.1;.4.;.,6;,8;=. -

$

381,479.55 $

415.35 $

5,685,241.82 $

5=99-,_2_14,;.,;6,;;8;;;",

See notes to the financial statements.

-32-

SCHEDULE "5"

RESTRICTED

UNEXPENDED REGULAR

PLANT FUNDS RENEWALS AND REPLACEMENTS

INVESTMENT IN PLANT

TOTAL

$ 219.106,503.97 $ 219.106.503.97

$ --~.:.8:01=.=09:0..6.6.

801,090.66

$

$

$

801.090.66 $

2.142.65

$

1,366.nO.51

$

2,142.65

186.776.59

1,897.942.27

1,366.770.51

4.446,814.47

44.246.52

21.052.00

-428.45 1.714.20' $ _ _.1:..3:6=:6:,:n=.O.:..5:1:.:~

68.675.75 415.35
$---===8:.0:3:4.:.8.:3.6..:1.1...

1.714.20 $

1,366.nO.51 $ 219,106.503.97 $ 227.942,430.74

-33-

GEORGIA SOUTHERN UNIVERSITY RECONCILIATION OF SALARIES AND TRAVEL
. YEAR ENDED JUNE 30, 1999

SCHEDULE "6"

Totals per Annual Supplement

Prepaid Items June 30, 1999

Accruals June 30,1998

Adjustments

Shared Services on Jointly Staffed Personnel

Coastal Georgia Community College

Barber,

Henry

Berhow,

Katherine

Doster,

Janet

Hammittee,

Diana J.

Hillegass,

Annette

Howe,

Stacy

Student Assistants

Georgia Institute of Technology

Champ,

Charles

Murray,

John

Kennesaw State University

Morrison-Sheltar, Alison

Savannah State University

Winston,

Craig N,

SALARIES

$

72,725,587,10 $

-1,098,573,35

TRAVEL 1,370,333.94

-3,703.10

21,459,00 2,000,00 7,092.00 -75,00 5,596.00 8,097,00 12,500.00
-27,000.00 -27,000,00
-200.00
2,000.00

$

71,627,779,65 $ ==::::::=1::,=3=7:0::,:3:::3::3::.=9=4=

See notes to the financial statements.

- 34-

SECTIONll AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

GEORGIA SOUTHERN UNIVERSITY
AuPITEE'S RESPONSE
SUMMARy SCHEDULE OF pRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED ruNE 30. 1999

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

539-96-01 FS-539-98-01 FS-539-98-02

Partially Resolved - See Corrective Action/Responses Previously Reported Corrective Action Plan Implemented Unresolved - See Corrective Action/Responses

CORRECTIVE ACTIONIRESPONSES

REVENUES/RECEIVABLES/RECEIPTS Student Accounts Receivable Not Supported by Financial Aid Finding Control Number: 539-96-01

Georgia Southern University is following the Board of Regents Policy, Section 704, on collecting fees at student registration and ensuring that allowable exceptions to the Board of Regents' Policy have supporting documentation. Student fee deferments are only granted to students whose fees are guaranteed by an agreement with an outside agency and whose student fees will be paid from approved financial aid.

Procedures to collect outstanding accounts receivable balances have been implemented. This is evident by the fact that the accounts receivable balances have declined during fiscal year 1999 and prior fiscal years. Georgia Southern University will continue its collection efforts on the outstanding student accounts receivable balances. In addition, to assist in the collection of the accounts, Georgia Southern has placed a financial record hold on the academic records of students who have outstanding accounts receivable balances.

GENERAL FIXED ASSETS Inadequacies in Operation ofProperty Management System Finding Control Number: FS-539-98-02

Management is currently reviewing all equipment inventory procedures in order to identify methods ofstrengthening internal accounting controls designed to ensure that assets are safeguarded against loss from unauthorized use or disposition. Currently, procedural changes identified include an independent review by management of discrepancies identified during physical inventories of equipment assets and procedures for authorizing and recording of equipment dispositions.

PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FA-539-98-01

Previously Reported Corrective Action Implemented