GA A%oo .RI MIfJ.. Iqq5 - gb STATE OF GEORGIA DEPARTMENT OF AUDITS 254 WASHINGTON STREET ATLANTA. GEORGIA 30334 AUDIT REPORT STATE OF GEORGIA MEDICAL COLLEGE OF GEORGIA AUGUSTA, GEORGIA YEAR ENDED JUNE 30, 19% MEDICAL COLLEGE OF GEORGIA - TABLE OF CONTENTS - SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBINED REPORT ON FINANCIAL STATEMENTS AND SUPPLEMENTARYINFORMATION 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 22 F COMBINING STATEMENT OF CHANGES IN FUND BALANCES CURRENT FUNDS - UNRESTRICTED 23 COMBINING STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES, AND OTHER CHANGES G UNRESTRICTED 24 H RESTRICTED 25 SCHEDULES SCHEDULES OF REVENUES AND EXPENDITURES COMPARED TO BUDGET 1 RESIDENT INSTRUCTION 26 2 LOTTERY FOR EDUCATION 29 3 OTHER ORGANIZED ACTMTIES 30 SCHEDULES OF OPERATIONS 4 LOAN FUNDS 34 5 ENDOWMENT AND SIMILAR FUNDS 36 6 SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS AGENCY FUNDS 37 SCHEDULES OF OTHER ORGANIZED ACTMTIES 7 BALANCE SHEET 40 8 CHANGES IN FUND BALANCES 41 9 REVENUES, EXPENDITURES, AND OTHER CHANGES 42 MEDICAL COLLEGE OF GEORGIA - TABLE OF CONTENTS- SECTION I FINANCIAL SUPPLEMENTARY INFORMATION SCHEDULES 10 CASH AND CASH EQUIVALENTS 43 11 INVESTMENTS 44 12 ACCOUNTS RECEIVABLE 45 13 CHANGES IN INVESTMENT IN PLANT 46 14 SCHEDULE OF FUND BALANCES CURRENT FUNDS AND PLANT FUNDS 48 SCHEDULES OF REVENUES 15 CURRENT FUNDS 50 16 OTHER ORGANIZED ACTIVITIES , 53 SCHEDULES OF EXPENDITURES BY OBJECT 17 CURRENT FUNDS 54 18 PLANT FUNDS 60 19 OTHER ORGANIZED ACTIVITIES 61 20 RECONCILIATION OF SALARIES AND WAGES, AND TRAVEL 63 SECTION II FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS SECTION I FINANCIAL CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 October 15, 1996 Honorable Zell Miller, Governor Members ofthe General Assembly of Georgia Members ofthe Board ofRegents ofthe University System of Georgia and Honorable Francis 1. Tedesco, President Medical College ofGeorgia 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) ofMedical College of Georgia as ofand for the year ended June 30, 1996. These financial statements are the responsibility of the College's management. Our responsibility 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 College to prepare its financial statements on a basis which is not consistent with generally accepted accounting principles with respect to the recording of encumbrances as expenditures and liabilities. To conform with generally accepted accounting principles, encumbrances should be recorded as a reservation offund balance. The effects on the financial statements of this departure from generally accepted accounting principles were not reasonably determinable, but are believed to be material. As disclosed in Note 1 to the financial statements, the College 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 $20,486,582.91 as of June 30, 1996, and the net change in fund balance for the year ended June 30, 1996, would be decreased by $1,132,013.21. 96ARL-63X As more fully discussed in Section n, Findings and Improper or Questioned Costs, material discrepancies were noted in the equipment inventory records ofthe College. Equipment inventory represents a significantportion ofthe College's investment in plant and we were unable to determine the effects these material discrepancies may have on the financial statements. In our opinion, except for the effects on the financial statements of the matters discussed in the third, fourth, and fifth paragraphs, the financial statements referred to above present fairly, in all material respects, the financial position ofMedical College ofGeorgia as ofJune 30, 1996, 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. As discussed in Note 1 to the financial statements, the College changed its method of recognizing revenue for patient services for the year ended June 30, 1996. This change is in accordance with generally accepted .accounting principles. Our audit was made for the purpose offorming an opinion on the financial statements taken as a whole. The accompanying supplementary infonnation (Exhibits E through H and Schedules 1 through 20) is presented for purposes of additional analysis and is not a required part of the financial statements ofMedical College of Georgia. Such information has been subjected to the auditing procedures applied in the audit ofthe financial statements and, in our opinion, except for the effects of the matters discussed in the third, fourth, and fifth paragraphs, such information is fairly presented in all material respects in relation to the financial statements taken as a whole. CLV:cm 96ARL-63X Claude L. Vickers State Auditor FUNANCU\LSTATE~TS - 1- MEDICAL COLLEGE OF GEORGIA COMBINED BALANCE SHEET ALL FUND GROUPS JUNE 30. 1996 ASSETS Cash and Cash Equivalents Investments Accounts Receivable (Net of Allowance for Uncollectibles) Inventories Prepaid Items Investment in Plant CURRENT FUNDS UNRESTRICTED RESTRICTED LOAN FUNDS $ 33,7-07,603.77 $ 12,093,766.23 $ 1,307,781.08 95,437,537.93 2,605,467.54 688,833.00 4,282,442.54 7,835,083.75 Total Assets $ 132,439,442.24 $ 16,376,208.77 $ 9,142,864.83 LIABILITIES AND FUND BALANCES Liabilities Accounts Payable Deferred Revenue Tuition and Fees Deposits Held in Custody for Others Capital Lease Obligations Total Liabilities Fund Balances U. S. Government Grants Refundable Institutional Loans - Restricted Endowment Quasi-Endowment - Restricted Net Investment in Plant Restricted Unrestricted Total Fund Balances $ 27,160,457.12 1,143,318.43 $ 28,303,775.55 $ 7,928,025.77 1,214,839.06 $ 16,376,208.77 $ 104,135,666.69 $ 104,135,666.69 $ 16,376,208.77 $ 9,142,864.83 Total Liabilities and Fund Balances $ 132,439,442.24 $ 16,376,208.77 $ 9,142,864.83 The notes to the financial statements are an integral part of this statement. -2- EXHIBIT "A" ENDOWMENT AND SIMILAR FUNDS UNEXPENDED PLANT FUNDS RENEWALS AND REPLACEMENTS INVESTMENT IN PLANT AGENCY FUNDS TOTAL (Memorandum Only) $ 10,984,542.36 $ 738,449.29 $ 5,507,158.32 $ 64,339,301.05 $ 5,316,874.42 5,316,874.42 1,075,790.00 108,630,854.22 2,605,467.54 11,187,138.53 11,875,971.53 _ _ _ _ _ _ $ 419,588,197.65 419,588,197.65 $ 5,316,874.42 $ 23,247,470.89 $ 738,449.29 $ 419,588,197.65 $ 5,507,158.32 $ 612,356,666.41 $ 12,051,175.98 $ $ 12,051,175.98 $ $ 1,230,986.50 4,085,887.92 $ 11,196,294.91 $ $ 5,316,874.42 $ 11,196,294.91 $ 367,403.14 $ 367,403.14 $ $ 4,744,052.02 $ 44,323,088.26 333,452.18 763,106.30 1,143,318.43 763,106.30 333,452.18 333,452.18 $ 5,507,158.32 $ 46,562,965.17 $ 419,254,745.47 371,046.15 371,046.15 $ 419,254,745.47 $ 7,928,025.77 1,214,839.06 1,230,986.50 4,085,887.92 419,254,745.47 16,376,208.77 115,703,007.75 $ 565,793,701.24 $ 5,316,874.42 $ 23,247,470.89 $ 738,449.29 $ 419,588,197.65 $ 5,507,158.32 $ 612,356,666.41, -3- MEDICAl. COLlEGE OF GEORGIA COMBINED STATEMENT OF CHANGES IN FUND BALANCES ALl FUND GROUPS 'fEAR ENDED JUNE 30. 1996 REVENUES ANP OTHER ADDITIONS Unrestricled Current Fund Rft8IlUM State Appropriations Major RepairsIRehabililalion Funds Lottery Proceeds Federal Grants and Contracts State Grants and ContracIs Local Grants and Contracts Private Gills, Grants, and Contracts Inwstmenllncome Endowment Other Reniallncome Realized Gains onlnwslmenls Intet'elIt on Losns R-wable Adjustments Prior Veers' Expenditures/Accounts Payable Prior Years' Checks Voided Expended for Plant Facilities Current Funds PIIInt Funds Ut.xpended Renewals and Replacements Georgia State Financing and InYMImeni Commission Other Additions R8CCMIlY cI Prior Veers' Cancelled Losns Total Rft8IlUM and OIher Additions EXPENDITURES AND OTHER DEDUCTIONS Educational and General Expenditures Auxiliary Enterprises Expenditures Hospital Expenditures Indirect Costs R_ed Refunded 10 Grantors Remillances to the 808rd of Regents of the University System cI Georgia Prior Veer's Unrestricted Fund Baiance (Surplus) Losn Cancellations and Wrile-Olfa CoIlec1ion Coats Expended for Plant Facilities Capitalized Noncapitalized DiapoaalalDeletionalAdjuatments Total Expenditures and OIher Deductions TRANSFERS BETWEEN FUNDS Nonmandatory Renewals and RepIacernenIs Capital Projects Total Transfers Between Funds Nellncreaae1(Decreaae) for the Year FUND BAlANCES JULV 1 1995 Rft8Ilue for Patient Services (Note 1) FUND BALANCES JULV 1, 1995 CURRENT FUNDS UNRESTRICTED RESTRICTED LOAN FUNDS $ 381,643,347.75 $ 16,402,3n.65 $ 12.229,758.64 563,422.87 36,799,844.78 237,792.30 163,574.00 33,541.00 65,063.38 338,518.02 9,827.97 182,637.87 $ 381,991.693.74 $ 66,253,196.24 $ 4,744.87 449,561.12 $ 180,882,965.67 $ 54,666,721.90 3,735,516.86 182,637,271.36 7,279,376.00 3,672,285.58 $ 122,000.00 121,445.24 66,916.32 4,728.13 $ 367,377,199.13 $ 65,618,383.48 $ 193,644.45 $ -310,338.36 -5,076,528.55 $ -5,386,666.91 $ 9,227,627.70 $ 634,812.76 $ 255,916.67 $ 13,746,494.61 $ 15,741,396.01 $ 8,886,948.16 81,161,544.38 $ 94,908,038.99 $ 15,741,396.01 $ 8,886,948.16 FUND BALANCES JUNE 30, 1996 The notes 10 the financial alatements are an integral part of this statement. -4- $ 104,135,666.69 $ 16,376,208.77 $ 9,142,864.83 EXHIBIT-s" ENDOWMENT ANDSMLAR FUNDS UNEXPENDED PLANT FUNDS RENEWALS AND REPLACEMENTS INVESTMENT IN PLANT TOTAL (Memorandum Only) $ ",670,000.00 815,000.00 $ 307,063.86 ",362,<401.02 $ 282,701.27 20.366.19 $ 307.063.86 $ 10.150,<468.<48 $ $ 381,643,347.75 ".670.000.00 815,000.00 16,565,951.65 12,229,758.6<4 583."22.87 $ 100,599.95 36,933,985.73 296,2<45.00 237.792.30 ",723,709.<40 282,701.27 307,063.86 182.637.87 11.122.<45 370,006.66 9.827.97 21,909.818.50 21.909.818.50 10,0<48,192.88 502,752.19 12,212,352.72 10,0<48,192.88 502,752.19 12,212,352.72 ",744.87 307.367.<45 $ 44.773.716.2" $ 50<4.233.067.13 $ 37,527.<48 10,0<48,192.88 $ 15,096.501.7" $ 25,182,222.10 $ $ 235,5<49.687.57 3.735.516.86 189.916,6<47.36 3,672,285.58 122.000.00 158.972.72 66.916.32 ",728.13 502.752.19 21,561.71 $ -5.<438.797.59 10.550.9<45.07 15.118.063.<45 -5,<438,797.59 52",313.90 $ -5,<438,797.59 $ <453,<456,965"'7 $ $ 5.076.528.55 $ 5.076,528.55 $ $ 307.063.86 $ -9.955.225.07 $ $ 5.009,810.56 $ 21,151,519.98 $ $ 5.009.810.56 $ 21,151.519.98 $ 310,338.36 $ 0.00 0.00 310,338.36 $ 0.00 93,391.91 $ 50.212,513.83 $ 50.776.101.66 277,65<4.2" $ 369.0<42,231.6<4 $ <433,856.oss.2O 81.161.544.38 277.65<4.2" $ 369.0<42,231.6<4 $ 515.017.599.58 $ 5,316.87.....2 .$ 11,196.294.91 $ 371.0<46.15 $ 419,25<4.745"'7 $ 565.793,701.24 5 - MEDICAL COLLEGE OF GEORGIA STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES, AND OTHER CHANGES YEAR ENDED JUNE 30, 1996 EXHIBITC Net Increasel(Decrease) in Fund Balances $ 9,227,627.70 $ 634,812.76 $ 9,862,440.46 The notes to the financial statements are an integral part of this statement. -6- MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996 EXHIBIT "0" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES REPORTING ENTITY Medical College ofGeorgia is one ofthirty-four (34) State supported member institutions of higher education in Georgia which comprise the University System of Georgia, an orgm:rlzational unit ofthe State of Georgia. The accompanying financial statements reflect the operations of Medical College of Georgia as a separate reporting entity. The Board ofRegents 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. Medical College ofGeorgia does not have authority to retain unexpended State funds (surplus) for any given fiscal year. Accordingly, Medical College of Georgia is considered an organizational unit ofthe Board ofRegents ofthe University System of Georgia reporting entity for financial reporting purposes because ofthe significance ofits legal, operational, and financial relationships with the Board ofRegents as defined in Section 2100 of the Governmental Accounting Standards Board Codification of Governmental Accounting and Financial Reporting Standards. FUND ACCOUNTING In order to ensure observance oflimitations and restrictions placed on the use ofthe resources available to the College, the accounts ofthe College are maintained in accordance with the principles offund accounting. This is the procedure by which resources for various purposes are classified for accounting and reporting purposes into funds that are in accordance with activities or objectives specified. Separate accounts are maintained for each fund; however, in the accompanying financial statements, funds that have similar characteristics have been combined into fund groups. Accordingly, all financial transactions have been recorded and reported by fund group. Within each fund group, the College's fund balance allocations and designations represent those portions of the 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 College retains full control to use for purposes of performing the primary functions of the College, e.g., instruction, research, public service, hospital support, auxiliary enterprises, and student activities. 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- MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 3D. 1996 EXHIBIT "0" . 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 AND SIMILAR FUNDS The fund used to account for endowment funds and quasi-endowment funds. Endowment funds are subject to the restrictions ofgift instruments requiring that the principal be invested in perpetuity and income only be utilized. While quasi-endowment funds have been established by the College for the same purposes as endowment funds, any portion of quasi-endowment funds may be expended. Restricted quasi-endowment funds may be expended only for the purposes established by the source ofsuch funds. 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 ofall physical properties owned by the College. Net Investment in Plant is an equity account showing the total book value ofphysical properties belonging to the College less the amount ofany indebtedness to others. AGENCY FUNDS The fund used to account for resources held by the College as custodian or fiscal agent for individual students, faculty, staff members, and organizations. BASIS OF ACCOUNTING 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 accrual 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 of accounting in which expenditures, other than accrued interest on general long-term debt, are recorded at the time liabilities are incurred and revenues are recorded when available and measurable to finance expenditures of the fiscal period. - 8- MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1996 EXHIBIT "D" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING 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 ofencumbrances as expenditures and liabilities is in conformity with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but is not consistent with generally accepted accounting principles, which provide for the recording of encumbrances as a reservation offund balance. Further, revenue recognition for expenditure-driven grants should be based upon expenditures determined in accordance with generally accepted accounting principles. Effective for fiscal year 1996, the College began recording revenue for patient services when earned rather than when cash was received. An adjustment ofS81,161,544.38 was made to restate the fund balance of Unrestricted Current Funds at July 1, 1995. Compensated absences represent obligations of the College 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 ofS20,486,582.91 and the related current year expenditure ofSl,132,013.21 have not been reported in the current funds as required by generally accepted accounting principles. Prior period adjustments and certain other items are reported as additions to and deductions from fund balances of current funds in the accompanying financial statements. This presentation is in accordance with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but differs from generally accepted accounting principles in that immaterial adjustments should be reported as current period revenues and expenditures. The effect of this departure is deemed to be immaterial to the fair presentation of the 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 of the College. 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. It is the policy ofMedical College of Georgia to record assets acquired through capital leases as additions to Investment in Plant when received at the total acquisition cost including interest. The liability for such leases at fiscal year-end is recorded in Investment in Plant including interest. This presentation differs from generally accepted accounting principles in that the assets and the related liability resulting from capital leases should be recorded in Investment in Plant at the inception of the agreement at the net present value of the future" minimum lease payments, not to exceed the fair value of the leased property. The effect ofthis departure is deemed to be immaterial to the fair pres,entation of the financial statements. - 9- MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996 EXHIBIT "D" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING The Statement of Current Funds Revenues, Expenditures, and Other Changes is a statement of financial activities of current funds related to the current reporting period. It does not purport to present the results of operations or the net income or loss for the period as would a statement of income or a statement of revenues and expenses. BUDGET The Board of Regents of the University System of Georgia - Administrative Central Office receives State appropriation allotments for units ofthe University System of Georgia. The appropriated budget is adopted at the departmental level and represents appropriations provided by the Amended Appropriations Act of 19951996. The appropriated budget covers current funds and plant funds, except for Auxiliary Enterprises and Student Activities which are not subject to appropriation. The budget allocation and disbursement ofthese funds is made to the various organizational units by the Administrative Central Office. In addition, the organizational units receive Federal funds and other funds directly and include these funds in the budget filed with the Administrative Central Office. A comparison ofanticipated funds available and budgeted expenditures by budget unit object class indicates that the following object classes were overspent by the amounts identified below: Resident Instruction Special Funding Initiative Other Organized Activities Medical College of Georgia Hospital and Clinics Operating Expenses: Sponsored Operations $ 1.238.97 $ 59.659,11 These overexpenditures of budget constitute a violation of Board of Regents policy, but do not constitute statutory violations of budget authority. Statutory violations of budget authority are reported at the departmental level. 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 recorded at cost or in the case of gifts at fair market value on the date of the gift. Funds received by the College 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. - 10 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1996 EXJDBIT "D" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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. The College has recorded its accounts receivable for patient services net of allowance for uncollectibles as follows: Gross Receivables Allowance for Uncollectible Accounts $154,100,941.91 -64,375,824.39 Net Receivables $ 89,725,117.52 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 or the first-in, first-out methods. Departments within the College use several costing methods for determining valuations of inventories for resale. Inventories of goods for resale are valued at cost using the first-in, first-out, or weighted average methods. 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 conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation ofthis data. NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds belonging to the State ofGeorgia 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 ofthe State of Georgia. - 11 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996 EXIllBIT "0" NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES (2) Bonds, bills, certificates ofindebtedness, notes, or other obligations ofthe counties or municipalities ofthe State of Georgia. (3) Bonds ofany public authority created by the laws ofthe State ofGeorgia, providing that the statute that created the authority authorized the use ofthe bonds for this purpose. (4) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia. (5) Bonds, bills, certificates ofindebtedness, notes, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest, or debt obligations issued by the Federal Land Bank, the Federal Home ~oan Bank, the Federal Intermediate Cr~it 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 ofaccounts 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 ofRegents of the University System of Georgia) the option of exempting demand deposits from the collateral requirements. The treasurer ofthe Board ofRegents is responsible for all details relative to furnishing the required depository protection for all units ofthe University System of Georgia. CATEGORIZATION OF DEPOSITS For purposes of analysis of custodial credit risk, cash deposits consist of all bank balances which include demand deposits and/or interest bearing accounts. The bank balances as ofJune 30, 1996, are categorized below in order to provide information about the extent to which such deposits are exposed to custodial credit risk: Category 1 - Amounts covered by depository insurance or collateralized with securities (at market value) held by the College or by its agent in the College's name. Category 2 - Amounts collateralized with securities (at market value) held by the pledging financial institution's trust department or agent in the College's name. Category 3 - Amounts collateralized with securities (at market value) held by the pledging financial institution, or by its trust department or agent but not in the College's' name, and amounts uncollateralized. - 12 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996 EXHIBIT liDII NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS CATEGORIZATION OF DEPOSITS carrying Amount Bank Balances Risk Categories 2 3 Cash Deposits Investment Portfolio Accounts $63,096,638.92 $78,893,550.50 $ 614,143.53 $74,557,534.55 $ 3,721,872.42 459,198.66 459.198.66 101.831.42 357367.24 Total Cash Deposits $63 555 837 58 $79352749.16 $ 71597495 $74 557 534 55 $ 4 079239.66 Included in Category 3 above were temporary investments in the amount of $1,258,626.69 that were uncollateralized. Exemption from the State collateralization requirements granted by the State Depository Board extends only to demand deposits. . CATEGORIZATION OF INVESTMENTS Investments are summarized and classified as to custodial credit risk within the three categories described below: Category 1 - Insured or registered, or securities held by the College or its agent in the College's name. Category 2 - Uninsured and unregistered, with securities held by the counterparty's trust department or agent in the College's name. Category 3 - Uninsured and unregistered, with securities held by the counterparty, or by its trust department or agent but not in the College's name. The carrying amounts of investment balances as ofJune 30, 1996, are categorized below: Type ofInvestment Risk Categories 2 3 Carrying Amount Market Value Common Stock $ Corporate Bonds U. S. Government Securities 0.00 $ 2,123,06627 $ 401,264.00 2,092,970.32 0.00 $ 2,123,06627 $ 2,529,618.38 401,264.00 382,250.00 2,092,970.32 2,166,874.88 $,===o~oo~ $ 4 617300 59 $===O~OO~ $ 4,617,300.59 $ 5,078,743.26 Investment Portfolio Accounts Mutual Funds Real Estate State Investment Pool 226,875.17 13,500.00 1.202,559.13 340,987.86 19,000.00 1.202.559.13 Total Investments $ 6 060234 89 $ 6 64129025 Funds invested in an investment pool managed by another governmental entity are not required to be categorized since the College did not own any specific, identifiable investment securities of the pool. - 13 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996 EXlllBIT "D" NOTE 3: INVESTMENT IN PLANT The following is a summary ofInvestment in Plant fixed assets as ofJune 30, 1996: Land Buildings Improvements Other Than Buildings Egwpment Library Books and Collections Construction in Progress Total Investment in Plant $ 8,998,281.93 234,576,427.56 4,601,985.68 159,663,828.11 8,782,029.91 2.965.644.46 $419.588,197.65 NOTE 4: CAPITAL LEASES Medical College of Georgia 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 ifappropriated 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 ofJune 30, 1996, future minimum lease payments under capital leases are as follows: Fiscal Year Ending June 30 1997 1998 1999 2000 Total Future Minimum Lease Payments NOTE 5: RISK MANAGEMENT $ 122,640.49 94,903.50 74,138.89 41.769.30 $ 333.452.18 Medical College of Georgia is a participant in the Board of Regents of the University System of Georgia Health Benefits Plan, which is a self-insurance program ofhealth and dental benefits for employees and retirees ofthe University System of Georgia. The College 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 audit report ofthe Board ofRegents ofthe University System of Georgia - Administrative Central Office. All units ofthe University System of Georgia share the risk ofloss for claims ofthe Health Benefits Plan. The Health Benefits Plan is considered a self-sustaining risk fund that provides health coverage for its members up to a maximum lifetime benefit of $1,000,000.00 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 of Georgia to process claims in accordance with the Health Benefits Plan as established by the Board ofRegents. - 14 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996 EXIllBIT "D" NOTE 5: RISK MANAGEMENT The Department ofAdministrative SeIVices (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 offi~' indemnification. Limited amounts of commercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks. The College, 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 seIVicing and claims payment. A self-insured program of professional liability for its employees was established by the Board ofRegents of the University System ofGeorgia 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 ofthe performance oftheir duties or in any way connected therewith. The program is administered by DOAS as a Self-Insurance Fund. The College has obtained commercial insurance for risk of loss associated with Professional Liability (Malpractice) in excess ofthe DOAS "Georgia Tort Claims Act" $1,000,000.00 cap and the "Georgia Broad Form" $1,000,000.00 cap. The shared excess aggregate limit for faculty is $10,000,000.00 and for housestaff is $3,000,000.00. The shared excess each loss limit for faculty is $10,000,000.00 and for housestaff is $3,000,000.00. The College's commercial insurance for Professional Liability excludes coverage for sexual misconduct, default judgements, violation of law and knowing transmission of or exposure to certain infectious diseases. NOTE 6: DEFERRED COMPENSATION PLAN The State ofGeorgia offers its employees a deferred compensation plan in accordance with Internal Revenue' Code Section 457. The plan, available to employees of the State ofGeorgia and county health departments, permits such employees to defer a portion oftheir salary until future years. Participation in the plan is optional. Participants choose the option or options in which they wish to participate. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights of the State of Georgia subject only to the claims of the State's general creditors. Participants' rights under the plan are equal to those of a general creditor of the State of Georgia in an amount equal to the fair market value of the deferred account for each participant. Financial information relative to the plan will be pr~sented in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1996. - 15 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996 EXHIBIT"D" NOTE 7: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA Plan Description Medical College ofGeorgia participates in the Teachers Retirement System of Georgia (TRS), a cost-sharing multiple-employer public employee retirement system (PERS) established by the General Assembly of Georgia for the purpose of providing retirement allowances and other benefits for teachers ofthe State of Georgia. The College's payroll for the year ended June 30, 1996, for employees covered by TRS was $154,960,645.27. The College's total payroll for all employees was $219,844;983.16. Benefits TRS provides service retirement, disability retirement, and survivor's benefits for its members. A member is eligible for service retirement after the member (1) has attained the age of60 years and has at least ten years ofcreditable service, (2) has at least 30 years of creditable service, regardless of age, or (3) has attained the age of55 years and has at least 25 years of creditable service. For those members with 30 years of service or those age 60 with at least ten years of service, retirement benefits are equal to 2%of the average of the member's two consecutive highest paid years ofservice multiplied by the number ofyears of creditable service up to 40 years. Any member who has between 25 ~d 30 years of creditable service and is at least 55 years ofage shall receive a benefit which is reduced by the lessor of 1/12 of 7% for each month the member is below age 60, or by 70/'0 for each year or fraction thereofby which the member has less than 30 years of service. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement benefits also include death and disability benefits whereby the disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The benefit is based on member's creditable service (minimum of 10 years of service) and compensation up to the date ofdeath or up to the time of disability. Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest. Contributions Required and Contributions Made Employees ofthe College who are covered by TRS are required to pay 5% oftheir gross earnings to TRS. The College makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees as advised by their independent actuary. For fiscal year 1996, the employer contribution rate was 11.81% for covered employees. In addition, the College contributed 4.87% to the TRS on behalfof employees electing to participate in the Regents Retirement Plan. The interest rate assumption (rate of return on investments) was 7.50%. Total contributions to the plan made during fiscal year 1996 amounted to $27,706,645.97, of which $19,958,613.71 was made by the College and $7,748,032.26 was made by employees. These contributions represented 12.87% (College) and 5% (employees) of covered payroll. - 16 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1996 EXIllBIT "D" NOTE 7: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA Funding Status and Progress Pension Benefit Obligation The amount of the total pension benefit obligation is based on a standardized measurement established by Statement No.5 of the Governmental Accounting Standards Board (GASB) that is required to be used for reporting purposes. The standardized measurement is the actuarial present value ofcredited projected benefits. This pension valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date and is adjusted for the effects of projected salary increases and any step-rate benefits. A standardized measure of the pension benefit obligation was adopted by the GASB to enable readers of the PERS financial statements to assess that PERS funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among similar PERS. The total unfunded pension benefit obligation ofTRS as ofJune 30, 1995, which was the latest information available, was as follows: Total pension benefit obligation $ 17,442,607,000.00 Net assets available for benefits, at cost 15,857,066,000.00 Unfunded pension benefit obligation $ 1.585,541.000.00 The measurement ofthe total pension benefit 9bligation is based on an actuarial valuation as ofJune 30, 1995. Net assets available for benefits were valued as ofthe same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers. Retirement System Contributions Total contributions from all employers to TRS for the year ended June 30, 1996, were $607,274,559.00. The College's contribution for the year ended June 30, 1996, of$19,958,613.71 was actuarially determined and represented 3.2865% oftotal contributions made by all participating employers. Trend Information Historical trend information is presented in the TRS June 30, 1996, financial report. This'information gives an indication ofthe progress made in accumulating sufficient assets to pay benefits when due. REGENTSRETIREMENTPLAN The State of Georgia provides optional pension benefits for eligible faculty and principal administrators through a defined contribution plan. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. - 17 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1996 EXHIBIT "D" NOTE 7: RETIREMENT PLANS REGENTS RETIREMENT PLAN State legislation requires that the employer contribute 4% and the employee contribute 5% ofthe participating employee's earnable compensation. Amounts attributable to all plan contributions are fully vested and nonforfeitable at all times. The College's payroll for employees covered by the Regents Retirement Plan for the year ended June 30, 1996, was $33,900,093.23. The College's total payroll for all employees was $219,844,983.16. The College and the covered employees made the required contributions of $1,356,003.73 (4%) and $1,695,006.02 (5%), respectively. GEORGIA DEFINED CONTRIBUTION PLAN Plan Description Medical College ofGeorgia participates in the Georgia Defined Contribution Plan (GDCP) which is a singleemployer 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. The College's payroll for the year ended June 30, 1996, for employees covered by GDCP was $2,043,090.82. The College's total payroll for all employees was $219,844,983.16. 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. Ifa 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 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. Contributions and Vesting Member contributions are seven and one-half percent (7.5%) of gross salary. There are no employer contributions. Earnings are credited to each member's account in a manner established by the Board of Trustees. Upon termination of employment, the amount ofthe member's account is refundable upon request by the member. Total contributions made by employees during fiscal year 1996 amounted to $153,232.52 which represents 7.50% of covered payroll. These contributions met the requirements of the plan. - 18 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996 EXlDBITID" NOTE 8: LEAVB POLICIES Employees earn annual leave ranging from one and one-quarter days to one and three-quarter days each month depending upon the employees' length ofcontinuous State service with maximum accumulation offorty-five days. Employees are paid for unused accumulated annual leave upon retirement or termination of employment. See Note 1- Basis of Accounting (Compensated Absences) Employees earn one day of sick leave each month with no maximum accumulation established. Unused accumulated sick leave does not vest with the employee and is forfeited upon retirement or termination of employment. NOTE 9: 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 College expects such amounts, ifany, to be immaterial to its overall financial position. Litigation, claims and assessments filed against Medical College of Georgia (as an organizational unit ofthe Board ofRegents ofthe University System of Georgia), ifany, are generally considered to be actions against the State ofGeorgia. Accordingly, significant litigation, claims and assessments pending against the State of Georgia are disclosed in the State ofGeorgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1996. NOTE 10: 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 ofRegents ofthe University System ofGeorgia 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 ofGeorgia 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 of service with the University System of Georgia are eligible for these postemployment health and life insurance benefits. Organizational units of the Board of Regents of the University System of Georgia pay the' employer portion for group insurance for affected individuals. As ofJune 30, 1996, there were 1,841 employees who had retired or were disabled that were receiving these postemployment health and life insurance benefits. For the year ended June 30, 1996, Medical College of Georgia recognized as incurred $1,391,031.29 ofexpenditures, which was net of$311,921.95 of participant contributions. - 19 - MEDICAL COLLEGE OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS ruNE 30. 1996 EXHIBIT"D" NOTE II: BONDING INFORMATION The President and all employees ofMedical College ofGeorgia are bonded under a Public Employees Blanket Bond written by the Employers Insurance ofWausau, their Bond No. 1450-02-110723, on which the premium was paid to October I, 1996. Under this agreement, the public employee dishonesty coverage insures Medical College ofGeorgia to a maximum of$I,OOO,OOO.OO against loss sustained through fraudulent or dishonest acts by its employees. The faithful performance of duty coverage insures the College to a maximum of $1,000,000.00 against loss sustained from failure of its employees to perform faithfully their duties or to account properly for all monies and property received by virtue oftheir position or employment. All employees ofMedical College of Georgia are also bonded under Commercial Crime Policies written by the United States Fire Insurance Company, their Policy Nos. 626 011675 2 and 626 012294 4, on which the premiums were paid to October I, 1996. Under these additional public employee dishonesty coverages, the policies insure the College to a maximum of $9,000,000.00 against loss sustained through fraudulent or dishonest acts by its employees and from failure ofits employees to perform faithfully. NOTE 12: ENROLLMENT The equivalent full-time student enrollment ofMedical College of Georgia was as follows: Regular Term Fall Quarter, 1995 Wmter Quarter, 1996 Spring Quarter, 1996 3,513 3,274 3,191 Average Summer School, 1995 - 20 - SUPPLEMENTARY INFORMAnON - 21 - ME[)ICAI. COLLEGE OF GEORGIA COMBINING BA!..ANCE SHEET CURRENT FUNDS UNRESTRICTEP JUNE 30. 1996 EXHIBIT"E" See notes to the financial s1atements. -22 - MEDICAl. COllEGE OF GEORGIA COMBINING STATEMENT OF CHANGES IN FUND BA!..ANCES CURRENT FUNDS - UNRESTRICTED YEAR ENDED JUNE 30, 1996 EXHIBIT"P' RESIDENT LOTTERY FOR OTHER ORGANIZED AUXILIARY STUDENT INSTRUCTION EDUCATION ACTMTlES ENTERPRISES ACTMTIES TOTAL REVENUES AND OTHER ADD!T!ONS Unl88tricted Cumtnl Fund Revenues Adjustments Prior Years' Expenditures/Accounts Payable Prior Years' ChecIcs Voided $ 101,024,380,30 $ 988,246,00 $ 275,1n,304.27 $ 4,281,672,43 $ 171,744.75 $ 381,643,347.75 74,154,09 3,579,55 264,289,65 6,148.51 74.28 99,91 338,518,02 9,827!d7 Total Revenues and OIher Additions $ 101,102,113,94 $ 988,246.00 $ 275,447,742,43 $ 4.281,846,62 $ 171,744,75 $ 381,991,693,74 EXPENDITURES AND OTHER DEDUCTIONS Educational and General Expenditures $ 100,894,745.61 $ Auxiliary Ent8fJlrises Expenditures Hospital Expenditures Remittances to the Board of Regents of the UnMInIity System of Georgia Prior Year's Unrestricted Fund Balance (Surplus) 80,336,91 984,389,96 $ . 78,805,154.61 $ 198,675,49 $ 180,882,965.67 $ 3.735,516,86 3,735,516,86 182,637,271.36 182.637,271.36 41,108,33 121,445,24 Total Expenditures and OIher Deductions $ 100,975,082.52 $ 984,389,96 $ 261,483,534.30 $ 3,735,516.86 $ 198,675.49 $ 367,3n,199.13 TRANSFERS BETWEEN FUNDS Nonmandatory R_1s and RepIacernent1I Capital Projects Total Trallllfers aew-n Funds $ -310,338,36 $ -5,014,480,00 -62,048.55 $ -5,014,480,00 $ -372,386,91 $ -310,338,36 -5.076,528,55 $ -5,386,866,91 NelIncreasel(Oecrease) for the Year $ 127,031.42 $ 3,856,04 $ 8,949,728,13 $ 173,942,85 $ -26,930,74 $ 9,227,627.70 FUND BALANCES JULY 1, 1995 $ 95,099,98 $ 0.00 $ 12,411,289,56 $ 1,170,085.71 $ 70,019,36 $ 13,746.494.61 Revenue for Patient Services (Nole 1) 81.161,544,38 81,161,544.38 FUND BALANCES JULY 1, 1995 $ 95,099,98 $ 0,00 $ 93.572.833.94 $ 1.170,085,71 $ 70,019,36 $ 94.908,038.99 FUNp BALANCES JUNE 30. 1996 $ 222,131,40 $ 3,856.04 $ 102,522,562.07 $ 1,344,028.56 $ 43,088.62 $ 104,135,666.69 See notes to the financial statements. 23 MEDICAl. COLLEGE OF GEORGIA COMBINING STATEMENT Of CURRENT FUNDS REVENUES EXPENDITURES, AND OTHER CHANGES UNRESTRICTED )'EAR ENDED JUNE 30 1996 EXHIBIT "0" RESIDENT LOTTERY FOR OTHER ORGANIZED AUXILIARY STUDENT INSTRUCTION EDUCATION ACTMTIES ENTERPRISES ACTMTIES TOTAL REVENUES State AppropriatIona $ Tuition and F_ FecIenll GI8rIta and Contracts State GI8rIta and Contracts Local Grants and Contracts PrivlIIe Gifts, Grants, and Contracts sales and Services d Educational AcIM1ies sales and Services d Aulliliary Enterprises sales and Services d HospItal Other Sources 85,045,066.00 $ 7,481,521.65 3,173,885.21 7,958.24 0.62 490,441.51 4,170,583.92 654,923.15 988,2<16.00 $ Talal R--.ues $ 101,024,380.30 $ 988.2<16.00 $ 55,443,586.00 $ 219,540,218.27 193.500.00 $ 141,476,898.00 $ 153,166.25 7,634,687.80 3,173,885.21 7,958.24 0.62 490,441.51 4,170,583.92 4,281,672.43 4,281,6n.43 219,540,218.27 18,578.50 667,001.65 275.1n,304.27 $ 4,281,672.43 $ 171.744.75 $ 381,643.347.75 EXPENDITURES Educational and General IMlruction R.-rch Public SeMce Academic Support Student Services Institutional Support Operation and Maintenance d Plant Scholarships and Fellow&hips Aulliliary Enterprises Student Housing Food Services Stores and Shops Other SeMce Units HospItal Medical College d Georgia 'Hospital $ 68,211,024.34 $ 949,717.49 $ 754,070.80 8,790,063.68 1,275,986.18 11,231,793.74 8,682,703.96 949,102.80 34,6n.47 26,525,925.23 52,279,229.38 $ $ 198,675.49 116,686,667.06 754,070.80 52,279,229.38 8,790,063.69 1,474,661.67 11.266,466.21 8,682,703.96 949,102.80 $ 679,762.68 . 780,398.30 321,180.55 1,954,175.33 679,762.68 780,398.30 321,180.55 1,954,175.33 182,637,271.36 182,637,271.36 Talal Expendituras $ 100,894,745.61 $ 984,389.96 $ 261,442,425,97 $ 3,735,516.86 $ 198,675.49 $ 367,255,753.89 OTHER TRANSFERS AND AOO!T!ONSI CDEOUCTIQNS) Transfers for Renewals and Replacements Transfers for Capital Projects Prior Period Adjustments (Net) $ Remittances to the Board of Regents d the University System of Georgia Prior Year's Unrastricted Fund Balance (Surplus) n,733.54 -80,336.91 $ -310,338,36 $ -5,014,480.00 -62,048.55 270,438.16 174.19 -41,108.33 $ -310,338.36 -5,076,528.55 348,345.99 -121,445.24 Talal Other Transfers and Additions/(Deduclions) $ -2,603.27 $ -4,785.150.17 $ -372,212.72 $ -5,159,966.16 Nellncreasel(Decrease) in Fund Balances $ 127,031.42 $ 3,856.04. $ 8,949,728,13 $ 173,942.85 $ -26,930,74 $ 9,227,627.70 See no4es to the financial statements, -24- Net Increase in Fund Balances $ 634,812.76 $ 0.00 $ _....6..3..4..,.8..1..2...7..6.... See notes to the financial statements. - 25 - MEDICAL COLLEGE OF GEORGIA SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET RESIDENT INSTRUCTION YEAR ENDED JUNE 30, 1996 REVENUES State Appropriations Other Revenues Retained CURRENT FUNDS UNRESTRICTED RESTRICTED PLANT FUNDS RENEWALS AND UNEXPENDED REPLACEMENTS $ 85,045,066.00 $ 15,979,314.30 $ 54,666,721.90 4,670,000.00 4,645,102.29 $ _ _--=296=,2:.45;.:;..;.:;.00=.. $ 101,024,380.30 $ 54,666,721.90 $ 9,315,102.29 $ _ _--.;;;296;";,,,,;.:;,2;;..45""'.""'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 Student Education Enrichment Program 78,013,943,68 $ 41,370,767.80 21,694,565.96 821,875.97 364,360.00 13,295,954.10 $ 24,330,023.74 $ 524,313.90 $ 100,894,745.61 $ 54,666,721.90 $ 24,330,023.74 $ _ _---.;5;.;;;;2..;.:4,.;;.31.;..;;3.;.;.90~ Excess of Revenues over Expenditures $ 129,634.69 $ ....._ .......-0.0..0.. $ -15,014,921.45 $ _ _....-.2.28==.\,,;;;;068-...90= (1) To eliminate tuition waivers and MCG Research Institute contract overhead not budgeted, and to reclassify prior year fund balances and current year transfers budgeted as revenues. See notes to the financial statements. -26- SCHEDULE -1- TOTAL ADJUSTMENTS (1) TOTAL (Budget Basis) BUDGET VARIANCEFAVORABLE (UNFAVORABLE) $ 89,715,066.00 $ 89,715,066.00 $ 89,715,066.00 $ 0.00 75,587,383.49 $ -1,:zn,687.98 74,309,695.51 98.597.795.00 -24,288.099.49 $ 165,302,449.49 $ -1,:zn,687.98 $ 164,024,761.51 $ 188.312.861.00 $ -24,288,099.49 $ 78,013,943.68 41,370,767.80 $ 78,013,943.68 $ 78,306,370.00 $ 41,370,767.80 43,807,098.00 21,694,565.96 $ 13,295,954.10 24,854,337.64 821,875.97 364.360.00 -1,567,805.43 -9,926,853.97 20,126,760.53 13,295,954.10 14,927,483.67 821,875.97 364,360.00 25,363,737.00 23,720,373.00 15,930.286.00 820,637.00 364,360.00 292,426.32 2,436,330.20 5,236,976.47 10,424,418.90 1,002,802.33 -1,238.97 0.00 $ 180,415,805.15 $ -11,494,659.40 $ 168.921.145.75 $ 188.312.861.00 $ 19,391,715.25 $ -15,113.355.66 $ 10,216.971.42 $ -4.896.384.24 $ -4.896.384.24 - 27- c~~ fJ ~~ I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I MEDICAL COLLEGE OF GEORGIA SCHEPULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET LOTTERY FOR EPUCATION YEAR ENDEp JUNE 30,1996 SCHEDULE "'Z' REVENUES State Appropriations CURRENT FUNDS PLANT FUNDS TOTAL UNRESTRICTED UNEXPENDED (Budget Basis) BUDGET VARIANCE FAVORABLE (UNFAVORABLE) $ 988,246,00 $ 815,000,00 $ 1,803,246,00 $ 1.803,246,00 $ 0,00 EXPENDITURES capital Outlay EqUipment, Technology and Construction Trust Fund Georgia Research Alliance $ Special Funding Initiative $ 949,717,49 34,672,47 134,670,88 $ 500,000.00 180,000,00 134,670,88 $ 135,000,00 $ 500,000,00 949,717.49 214,672.47 500,000,00 950,000,00 218.246,00 329,12 0.00 282,51 3.573,53 $ 984,389,96 $ 814,670,88 $ 1,799,060,84 $ 1,803.246,00 $ 4,185,16 Excess of Revenues over Expenditures $ 3,856,04 $ 329.12 $ 4.185.16 $ 4.185,16 See notes to the financial statements, -29- MEDICAL COLLEGE OF GEORGIA SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET OTHER ORGANIZED ACTIVITIES YEAR ENDED JUNE 30. 1996 MEDICAL COLLEGE OF GEORGIA HOSPITAL AND CLINICS REVENUES State Appropriations Other Revenues Retained CURRENT FUNDS UNRESTRICTED RESTRICTED TOTAL ADJUSTMENTS (1 ) $ 31,697,885.00 $ 31,697,885.00 216,826,294.07 $ 7,279,376.00 224,105,670.07 $ -8,563,573.14 $ 248,524,179.07 $ 7,279,376.00 $ 255,803,555.07 $ -8,563,573.14 EXPENDITURES Personal Services: Education, General and Departmental Services Sponsored Operations Operating Expenses: Education, General and Departmental Services Sponsored Operations $ 150,199,521.62 $ 150,199,521.62 $ 5,321,179.89 5,321,179.89 84,716,979.12 1,958,196.11 84,716,979.12 $ 1,958,196.11 5,014,480.00 $ 234,916,500.74 $ 7,279,376.00 $ 242,195,876.74 $ 5,014,480.00 Excess of Revenues over Expenditures $ 13,607,678.33 $ 0.0...0. $ 13,607,678.33 $ -13,578,053.14 (1) To eliminate revenue for patient billings not budgeted and to reclassify current year transfers budgeted as expenditures. See notes to the financial statements. -30- SCHEDULE "3" TOTAL (Budget Basis) . BUDGET VARIANCEFAVORABLE (UNFAVORABLE) $ 31,697,885.00 $ 31,697,885.00 $ 215,542,096.93 223,600,032.00 0.00 -8,057,935.07 $ 247,239,981.93 $ 255,297,917.00 $ -8,057,935.07 $ 150,199,521.62 $ 154,833,984.00 $ 5,321,179.89 5,380,839.00 89,731,459.12 1,958,196.11 93,184,557.00 1,898,537.00 4,634,462.38 59,659.11 3,453,097.88 -59,659.11 $ 247,210,356.74 $ 255,297,917.00 $ 8,087,560.26 $ 29,625.19 $ 29,625.19 - 31 - MED!CAI. COLLEGE OF GEORGIA SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET OTHER ORGANIZED ACTMTIES YEAR ENQED JUNE 30, 1996 SCHEDULE "3" JOINT BOARD OF FAMILY PRACTICE REVENUES SIIIte Appropriations CURRENT FUNDS TOTAl.. UNRESTRICTED RESTRICTED CBudget Basis) BUDGET VARIANCEFAVORABLE (UNFAVORABlE) $ 23,745,701,00 $ 0,00 $ 23,745,701.00 $ 23,745,701.00 $ 0.00 EXPENDITURES PersonIII 8ervic:es: EdllClllion, General and Departmental Services $ 289,595.30 $ Operating Expenses: EdllClllion, General and Departmental Services 634,961.00 capitation ConIrac:Is for Family Practice Residency 3,548,752.41 Residency Capitation Grants 2,.c&4,809,73 Student PreceptorshIps 143,250.00 Mercer Medical School Grant 6,619,012.00 Morehouse School fA Medicine Grant 5,549,778.00 S.R.E.B.~ 4,451 ,950,00 0.00 $ 289,595.30 $ 301,071.00 $. 634,961,00 3,548,752.41 2,484,809.73 143,250.00 6,619,012.00 5,549,778,00 4,451 ,950,00 634,961,00 3,548,759,00 2,484,870,00 146,400.00 6,619,012.00 5,549,778,00 4,460,850.00 11,475.70 0,00 6.59 6027 3,150.00 0,00 0.00 8,900.00 $ 23,722,108,44 $ 0.00 $ 23,722,108.44 $ 23,745,701,00 $ 23,592.56 Excess fA Revenues over Expenditures $ 23,592.56 $ 0,00 $ 23,592.56 $ 23,592.56 See notes to the financial statements, -32 MEDICAl.. COlLEGE Of GEORGIA SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET OTHER ORGANIZEPACTMTIES YEAR ENDED JUNE 30, 1996 SCHEDULE "3" GEORGIA RADIATION THERAPY CENTER REVENUES Other Revenues Retained EXPENDITURES PersonIIl Services: Education, General and Departmental Services Operating Expenses: Education, General and Departmental Services Excess of Revenues over Expenditures CURRENT FUNDS TOTAL UNRESTRICTED RESTRICTED (Budget Basis) BUDGET VARIANCEFAVORABlE Transfers for capital Projects PriorPeriodAdjustrnenls(Net) Remltlances to the Board of Regents 01 the University System 01 Georgia Prior Year's Unrestric:ted Fund Balance (Surplus) $ -5,014,480,00 269,190.78 $ 591,93 $ -41,108,33 $ -5,014,480.00 655,45 270,438,16 -41,108,33 $ -5,014,480,00 270,438,16 -41,108,33 Toial Other Transfers and Addilionsl(Deductions) $ -4,745.289,22 $ -40,516,40 $ 655,45 $ -4,785,150,17 $ -4,785,150,17 Net IncreaseI(Decrease) in Fund Balances $ 8,862,389,11 $ -16,923,84 $ 104,262,86 $ 8,949,n8,13 $ 0._,0.0. $ 8,949,n8,13 See notes to the financial statements, -42 MEDICAL COLLEGE OF GEORGIA CASH AND CASH EQUIVALENTS JUNE 30.1996 SCHEDULE 10 NONINTEREST BEARING ACCOUNTS First Union National Bank of Georgia, Augusta, Georgia SunTrust Bank of Augusta, Augusta, Georgia Wachovia Bank of Georgia, Augusta, Georgia INTEREST BEARING ACCOUNTS First Union National Bank of Georgia, Augusta, Georgia Certificates of Deposit (5.15% - 5.46%) Passbook Savings Account (1.98%) Georgia Bank and Trust Company, Augusta, Georgia Certificate of Deposit (5.25%) NationsBank of Georgia, Augusta, Georgia N.O.W. Account (5.21 %) State of Georgia - Office of Treasury and Fiscal Services State Investment Pool Local Govemment Investment Pool (5.321%) OTHER Cash on Hand Petty Cash $ -1,013,447.45. 4,026,011.49 20,000.00 $ 3,032,564.04 $ 55,005,000.00 4,746.28 $ 55,009,746.28 1,000,000.00 4,054,328.60 1,202,559.13 61,266,634.01 40,103.00 $ 64.339,301.05 See notes to the financial statements. - 43- MEDICAL COLLEGE OF GEORGIA INVESTMENTS JUNE 30,1996 SCHEDULE "11" Investment Accounts NationsBankofAugus~, Augusta, Georgia Investment Portfolio Account Money Market Funds . . Mutual Funds Real Estate SunTrust Bank of Georgia, Augusta, Georgia Investment Portfolio Account Cash Common Stock Corporate Bonds Money Market Funds U. S. Govemment Securities $ 1,831.42 226,875.17 13,500,00 $ 242,206.59 $ -56,745.76 2,123,066.27 401,264.00 514,113.00 2,092,970.32 5,074,667.83 $ 5,316,874,42 See notes to the financial statements. -44 - MEPlCAL COLLEGE OF GEORGIA ACCOUNTS RECEIVABLE JUNE 30,1996 SCHEDULE "12" State Appropriations Allotment from the Board of Regents of the University System of Georgia Federal Grants and Contracts Research and Instruction State Grants and Contracts Research and Instruction Local Grants and Contracts Research and Instruction Private Gifts, Grants, and Contracts Research and Instruction sales and 8ervices of Hospital Patient Billings Other Georgia State Financing and Investment Commission Interest Earned Student Accounts Student Nates Vendor Credit Memos Other CURRENT FUNDS UNRESTRICTED RESTRICTED LOAN FUNDS' PLANT FUNDS UNEXPENDED TOTAL $ 4,000,000,00 $ 1,513,119.75 2,141,704.43 131,610.39 496,007,97 89,725,117.52 $ 250,000.00 $ 4,250,000.00 1,513,119.75 2,141,704.43 131,610.39 496,007.97 89,725,117,52 1,457,967.19 63,291,00 90,592.42 100,569.80 $ 7,835,083.75 825,790,00 1,457,967,19 825,790.00 63,291.00 7,835,083,75 90,592.42 100,569.80 $ 95,437,537,93 $ 4,282.442.54 $ 7,835,083.75 $ 1,075,790.00 $ 108,630,854.22 See nates to the financial statements. -45- MEDICAL COLLEGE OF GEORGIA CHANGES IN INVESTMENT IN PLANT YEAR ENDED JUNE 30, 1996 Land Buildings Improvements Other Than Buildings Equipment Ubrary Books and Collections Construction in Progress BALANCE JULY 1,1995 CURRENT FUNDS UNRESTRICTED RESTRICTED PLANT UNEXPENDED $ 8,998,281,93 194,429,684.24 $ 509,530.05 $ 886,550.00 $ 8,662,545.85 3,825,690.89 394,788.97 372,on.34 144,523,682.74 --16,644,600.17 2,786,753.82 1,013,569.69 8,094,918.30 687,595.49 10,912,132.02 $ 370,784,390.12 $ 18,236,514.68 $ 3,673,303.82 $ 10,048,192.88 SUMMARY OF INVESTMENT College Capital Leases $ 369,042,231.64 $ 18,236,514.68 $ 3,673,303.82 $ 10,048,192.88 1,742,158.48 $ 370,784,390.12 $ 18,236,514.68 $ 3,673,303.82 $ 10,048,192,88 See notes to the financial statements. - 46- SCHEDULE "13" ADDITIONS FUNDS RENEWALS AND REPLACEMENTS GEORGIA STATE FINANCING AND INVESTMENT COMMISSION CAPITAL LEASES PRIVATE GIFTS DEDUCTIONS DISPOSALSI DELETIONSI ADJUSTMENTS BALANCE JUNE 30, 1996 $ 8,998,281.93 $ 472,297.94 $ 10,670,561.92 $ -18,945,257.56 234,576,427.56 10,074.98 646.50 4,601,985.68 20,37927 $ 1,207,047.42 $ .. 100,599.95 6,632,804.95 159,663,828.11 483.88 8,782,029.91 1,541,790.80 9,488,278.36 2,965,644.46 $ 502,752.19 $ 12,212,352.72 $ 1,207,047.42 $ 100,599.95 $ -2,823,043.87 $ 419,588,197.65 $ 502,752.19 $ 12,212,352.72 $ 100,599.95 $ -5,438,797.59 $ 419,254,745.47 _ _ _ _ _ $ 1,207,047.42 2,615,753.72 333,452.18 $ 502,752.19 $ 12,212,352.72 $ 1,207,047.42 $ 100,599.95 $ -2,823,043.87 $ 419,588,197.65 - 47- MEDICAL COLLEGE OF GEORGIA SCHEDULE OF FUND BALANCES CURRENT FUNDS AND PLANT FUNDS JUNE 30.1996 NET INVESTMENT IN PLANT Investment in Plant Facilities RESTRICTED Designated for Subsequent Years' Expenditures UNRESTRICTED Designated For Capital Projects (GSFIC) For Equipment/Revenue Stabilization Reserve for Georgia Radiation Therapy Center For Hospital Operations For Inventory Reserve For Property Sales Reserve For Renewals and Replacements Reserve For Revenue Stabilization Reserve for Medical College of Georgia Hospital and Clinics For SUbsequent Years' Expenditures Undesignated Surplus Regular Lottery for Education RESIDENT INSTRUCTION LOTIERYFOR EDUCATION CURRENT FUNDS UNRESTRICTED OTHER ORGANIZED AUXILIARY ACTMTIES ENTERPRISES . $ 10,872.63 113,375.00 $ 446,840.49 89,725,117.52 2,171,769.34 $ 685,946.17 10,154,650.23 658,082.39 97,883.n $ $ 222,131.40 $ 3,856.04 3,856.04 $ 24,184.49 102,522,562.07 $ 1,344,028.56 $ 222,131.40 $ 3,856.04 $ 102,522,562.07 $ 1,344,028.56 See notes to the financial statements. -48- STUDENT ACTMTIES RESTRICTED PLANT FUNDS UNEXPENDED LOTTERY FOR RENEWALS AND REGULAR EDUCATION REPLACEMENTS INVESTMENT IN PLANT TOTAL $ 419,254,745.47 $ 419,254,745.47 $ 16,376,208.77 $ 16,376,208.77 $ 11,187,138.53 $ 43,088.62 $ 371,046.15 $ 11,187,138.53 446,840.49 89,725,117.52 2,868,588.14 113,375.00 371,046.15 10,154,650.23 701,171.01 $ 43,088.62 8,827.26 _____ $ $ 11.195,965.79 $ 3:::29:=.:.:..12:.. 329.12 $ _ _3;;,;.7-,"1,.,;;;.046=,-,.1.;;.5 130,895.52 4,185.16 $ 115,703,007.75 $ 43,088.62 $ 16,376,208.77 $ 11,195,965.79 $ 329.12 $ 371,046.15 $ 419,254,745.47 $ 551,333,961.99 -49- MEDiCAl COLLEGE OF GEORGIA SCHEDULE Of REVENUES CURRENT FUNDS YEAR ENDED JUNE 30. 1996 RESIDENT INSTRUCTION LOTTERY FOR EDUCATION UNRESTRICTED OTHER ORGANIZED AUXILIARY ACTIVITIES ENTERPRISES SCHEDULE "15" STUDENT ACTIVITIES TOTAL RESIDENT INSTRUCTION RESTRICTED OTHER ORGANIZED ACTIVITIES TOTAL TOTAL $ 116,493,986.00 820,637.00 364,360.00 3,548,759.00 2,484,870.00 1