Audit report, state of Georgia, Savannah State University, Savannah, Georgia, year ended June 30, 1996

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AUDIT REPORT STATE OF GEORGIA SAVANNAH STATE UNIVERSITY SAVANNAH, GEORGIA YEAR ENDED JUNE 3D, 1996

SAVANNAH STATE 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 OTH, ER CHANGES

UNRESTRICTED

23

SCHEDULES

SCHEDULES OF REVENUES AND EXPENDITURES COMPARED TO BUDGET

1

RESIDENT INSTRUCTION

24

2

LOTTERY FOR EDUCATION

26

SCHEDULES OF OPERATIONS

3

LOAN FUNDS

27

4

ENDOWMENT AND SIMILAR FUNDS

28

5 SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS

AGENCY FUNDS

29

6 CASH AND CASH EQUIVALENTS

31

7 ACCOUNTS RECEIVABLE

33

8 CHANGES IN INVESTMENT IN PLANT

34

9 SCHEDULE OF FUND BALANCES

CURRENT FUNDS AND PLANT FUNDS

36

SAVANNAH STATE UNIVERSITY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

SUPPLEMENTARY INFORMATION

SCHEDULES

10 SCHEDULE OF REVENUES

CURRENT FUNDS

38

SCHEDULES OF EXPENDITURES BY OBJECT

11

CURRENT FUNDS

40

12

PLANT FUNDS

44

13 RECONCILIATION OF SALARIES AND WAGES, AND TRAVEL

45

14 RECONCILIATION OF PER DIEM AND FEES

46

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) 6562174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
December 11, 1996

Honorable Zell Miller, Governor Members ofthe General Assembly of Georgia Members ofthe Board ofRegents ofthe University System of Georgia
and Honorable John T. Wolfe, President Savannah State 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 Savannah State University as ofand for the year ended June 30, 1996. These financial statements are the responsibility of the University'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 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 of this departure from generally accepted accounting principles were not reasonably determinable, but are believed to be material.

96ARL-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 $758,613.59 as ofJune 30, 1996, and the net change in fund balance for the year ended June 30, 1996, would be decreased by $15,811.85.
In our opinion, except for the effects on the financial statements ofthe matters discussed in the third and fourth paragraphs, the financial statements referred to above present fairly, in all material respects, the financial position of Savannah State University 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.
Our audit was made for the purpose offorming an opinion on the financial statements taken as a whole. The accompanying supplementary information (Exhibits E through G and Schedules 1 through 14) is presented for purposes of additional analysis and is not a required part of the financial statements of Savannah State University. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and, in our opinion, except for the effects of the 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,
t:L~
Claude L. Vickers State Auditor
CLV:gp 96ARL-62

FINANCIAL STATEMENTS - 1-

SAVANNAH STATE UNIVERSITY COMBINED BALANCE SHEET ALL FUND GROUPS JUNE 30,1996

ASSETS
Cash and Cash Equivalents Accounts Receivable Inventories Prepaid Items Due from Other Fund Groups Investment in Plant
Total Assets
LIABILITIES AND FUND BALANCES
Liabilities Accounts Payable Salaries Payable Student Deposits Deferred Revenue Tuition and Fees Deposits Held in Custody for Others Due to Other Fund Groups
Total Liabilities
Fund Balances U. S. Government Grants Refundable Institutional Loans - Restricted Endowment Term Endowment Net Investment in Plant Restricted Unrestricted
Total Fund Balances
Total Liabilities and Fund Balances

CURRENT FUNDS UNRESTRICTED RESTRICTED

LOAN FUNDS

$

488,135.48

$

50,057.96

234,635.81 $ 1,090,874.82

789,247.55

688,401.76

8,706.96

935,201.81

$ 2,355,081.82 $ 1,090,874.82 $ 839,305.51

$

922,989.87

23,019.70

63,660.00

627,192.50

$ 935,201.81

$ 1,636,862.07 $ 935,201.81

$ 764,912.92 74,392.59

$ 155,673.01

$

718,219.75

$

718,219.75 $ 155,673.01 $ 839,305.51

$ 2,355,081.82 $ 1,090,874.82 $ 839,305.51

The notes to the financial statements are an integral part of this statement.
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EXHIBIT "A"

ENDOWMENT AND SIMILAR
FUNDS

UNEXPENDED

PLANT FUNDS RENEWALS AND REPLACEMENTS

INVESTMENT IN PLANT

AGENCY FUNDS

TOTAL (Memorandum
Only)

$ 614,392.34 $ 185,706.97 $

467,916.10

$ 267,023.95 $ 2,073,232.80

1,046,874.26

697.29 3,162,329.73

688,401.76

8,706.96

935,201.81

_ _ _ _ _ _ $ 49,687,420.12

49,687,420.12

$ 614,392.34 $ 1,232,581.23 $

467,916.10 $ 49,687,420.12 $ 267,721.24 $ 56,555,293.18

$ 1,136,248.48 $

$ 1,136,248.48 $

$ 420,746.11 193,646.23

$

96,332.75 $

$ 614,392.34 $ 96,332.75 $

68,894.00 68,894.00

$ 172,165.89 $ 2,300,298.24 23,019.70 63,660.00

95,555.35

627,192.50 95,555.35
935,201.81

$ 267,721.24 $ 4,044,927.60

$ 49,687,420.12 399,022.10 399,022.10 $ 49,687,420.12

$ 764,912.92 74,392.59
420,746.11 193,646.23 49,687,420.12 155,673.01 1,213,574.60
$ 52,510,365.58

$ 614,392.34 $ 1,232,581.23 $

467,916.10 $ 49,687,420.12 $ 267,721.24 $ 56,555,293.18

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SAVANNAH STATE UNIVERSITY COMBINED STATEMENT OF CHANGES IN FUND BALANCES
AI.l FUND GROUPS YEAR ENDED JUNE 30, 1996

EXHIBIT "8"

ENDOWMENT AND SIMILAR
FUNDS

UNEXPENDED

PlANT FUNDS RENEWALS AND REPLACEMENTS

INVESTMENT IN PLANT

TOTAL (Memorandum
Only)

$ 181,239.00 1,1n.593.00 338,046.40

109.147.83

$

5.000.00

34,335.00

13,201.78 $

3.729.00

$

5,000.00 $ 1,857.292.01 $

$ 26.351,267.47

181,239.00 1.177,593.00 13,704,203.86
687.187.01 109,147.83 133.171.31

19,449.14

33,4n.29 32.698.52 15,389.93

7,637.01

20,316.38 6,608.54

$ 1.605,074.17 1,605,074.17

1,760.959.26 490,853.34 210,958.75

1,760,959.26 490,853.34 210,958.75

4,795.00

27,086.15 $ 4,067,845.52 $ 46,524,941.66

$

0.00

$ 35.907,163.45 4.286,695.n 199,921.06

$

75,746.14

90,372.49

1,026.00 4,936.19 3,734.18

1,760,959.26 $

490.853.34 $

550,099.05

2,251.812.60 550,099.05

$

0.00 $ 1,836,705.40 $

490,853.34 $ 550,099.05 $ 43,295,760.74

$

14,384.60

$

14,384.60

$

19.384.60 $

595,007.74

$ $ 20,586.61 $ 75,746.14

$

0.00

196,055.15

0.00

196,055.15

$

0.00

-267.712.04 $ 3,517.746.47 $ 3,229,180.92

666,734.14 46,169,673.65 49,281,184.66

$ 614,392.34 $

96,332.75 $

399,022.10 $ 49,687,420.12 $ 52,510,365.58

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Net Increase/(Decrease) in Fund Balances

$

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

9,026.60 $ -81,413.48 $ -72,386.88

SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30.1996

EXHIBIT"D"

NOTE 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY Savannah State University (fonnerly Savannah State College) is one of thirty-four (34) State supported member institutions of higher education in Georgia which comprise the University System of Georgia, an organizational unit ofthe State of Georgia. The accompanying financial statements reflect the operations of Savannah State 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. Savannah State University does not have authority to retain unexpended State funds (surplus) for any given fiscal year. Accordingly, Savannah State University is considered an organizational unit ofthe Board ofRegents ofthe University System of Georgia reporting entity for financial reporting purposes because ofthe significance of its legal, operational, and financial relationships with the Board of Regents 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 of the resources available to the University, the accounts ofthe University 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 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, 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.
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SAVANNAH STATE UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1996

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 AND SIMllAR FUNDS
The fund used to account for endowment funds and term endowment funds. Endowment funds are subject to the restrictions ofgift instruments requiring that the principal be invested in perpetuity and income only be utilized. Term endowment funds are similar to endowment funds except that upon the passage of a stated period oftime or the occurrence of a particular event, all or part of the principal may be expended.
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 ofphysical 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, 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 ofaccounting applicable to colleges and universities prescribed in the American Institute of Certified Public Accountants' audit guide reporting model. The modified accrual basis ofaccounting is defined as that method 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.

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SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1996

EXHIBIT liDII

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING Contractual obligations for goods and services which have not been received at the end ofthe 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.
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 $758,613.59 and the related current year expenditure of $15,811.85 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 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 of revenues and expenses.
BUDGET The Board of Regents of the University System of Georgia - Administrative Central Office receives State appropriation allotments for units of the University System of Georgia. The appropriated budget is adopted at the departmental level and represents appropriations provided by the Amended Appropriations Act of 19951996. The appropriated budget covers current funds and plant funds, except for Auxiliary Enterprises and
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SAYANNAB STATE UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS
JUNE 3D. 1996

EXHIBIT "D"

NOTE 1: SUM:MAR.Y OF SIGNIFICANT ACCOUNTING POLICIES

BUDGET 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 Personal Services: Education, General and Departmental Services Sponsored Operations

$ 21.854.13 $ 18,144.64

These overexpenditures of budget constitute a violation of Board ofRegents 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.

ACCOUNTS RECEIVABLE Accounts receivable consist ofreimbursements 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 ofgoods for resale are valued at cost using the first-in, first-out method.

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.

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SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1996

EXHIBIT "D"

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.
(2) Bonds, bills, certificates ofindebtedness, notes, or other obligations of the counties or municipalities of the State of Georgia.
(3) Bonds ofany public authority created by the laws ofthe State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose~
(4) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia.
(5) Bonds, bills, certificates ofindebtedness, notes, or other obligations ofa 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 ofthe 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 of the University System of Georgia.
CATEGORIZATION OF DEPOSITS For purposes of analysis of custodial credit risk, cash deposits consist of all bank balances which include demand deposits and/or interest bearing accounts. The bank balances as of June 30, 1996, are categorized below in order to provide information about the extent to which such deposits are exposed to custodial credit risk:

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SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1996

EXHIBIT "0"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS

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

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

Cash Deposits

Carrying Amount

Bank Balances

Risk Categories

2

3

$ 1388998 10 $ 4091 171 79 $ 300 000 00 $ 589733 50 $ 3,201 438.29

Included in Category 3 above were certificates of deposit in the amount of $31,436.01 that were uncollateralized. Exemption from the State collateralization requirements granted by the State Depository Board extends only to demand deposits.

CATEGORIZATION OF INVESTMENTS At June 30, 1996, the carrying amount and market value of the University's total investments were $667,474.70 and $664,703.89 respectively, and consisted entirely offunds in the Board ofRegents ShortTerm Investment Fund Investment Pool which are not required to be categorized since the University did not own any specific identifiable securities in the pool.

NOTE 3: INVESTMENT IN PLANT

Th~ following is a summary ofInvestment in Plant fixed assets as ofJune 30, 1996:

Land Buildings Improvements Other Than Buildings Equipment Library Books and Collections

$ 325,975.16 31,255,432.49 7,194,018.08 6,894,473.31 4,017,521.08

Total Investment in Plant

$49,687420.12

NOTE 4: RISK MANAGEMENT

Savannah State University is a participant in the Board ofRegents 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 ofGeorgia. The University and participating employees and retirees pay premiums to the

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SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1996

EXHIBIT"D"

NOTE 4: RISK MANAGEMENT
Health Benefits Plan for this health insurance coverage. The Health Benefits Plan is included in the audit report ofthe Board ofRegents ofthe University System ofGeorgia - Administrative Central Office. All units ofthe University System ofGeorgia 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.
The Department ofAdministrative Services (DOAS) has the responsibility for the State of Georgia of making and carrying out decisions that will minimize the adverse effects of accidental losses that involve State government assets. The State believes it is more economical to manage its risks internally and set aside assets for claim settlement. Accordingly, DOAS processes claims for risk of loss to which the State is exposed, including general liability, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' indemnification. Limited amounts of commercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks. The University, as an organizational unit of the Board of Regents of the University System of Georgia, is part of the State of Georgia reporting entity, and as such, is covered by the State of Georgia risk management program administered by DOAS. Premiums for the risk management program are charged to the various state organizations by DOAS to provide claims servicing and claims payment.
A self-insured program of professional liability for its employees was established by the Board 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.
NOTE 5: 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 of Georgia 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 presented in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1996.

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SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30.1996

EXHIBIT liDII

NOTE 6: RETIREMENT PLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA
Plan Description Savannah State University 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 of the State of Georgia. The University's payroll for the year ended June 30, 1996, for employees covered by TRS was $11,352,163.51. The University's total payroll for all employees was $15,682,207.26.
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 of 60 years and has at least ten years ofcreditable service, (2) has at least 30 years ofcreditable 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 ofservice 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 of years ofcreditable service up to 40 years. Any member who has between 25 and 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 7% for each year or fraction thereofby which the member has less than 30 years of service. The nonnal 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 of death or up to the time of disability.
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest.
Contributions Required and Contributions Made Employees ofthe University who are covered by TRS are required to pay 5% of their gross earnings to TRS. The University makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1996, the employer contribution rate was 11.81% for covered employees. In addition, the University contributed 4.87% to the TRS on behalf of employees electing to participate in the Regents Retirement Plan. The interest rate assumption (rate ofretum on investments) was 7.50%.
Total contributions to the plan made during fiscal year 1996 amounted to $2,043,976.70, of which $1,480,684.29 was made by the University and $563,292.41 was made by employees. These contributions represented 13.04% (University) and 5% (employees) of covered payroll.
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SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30,1996

EXHIBIT liDII

NOTE 6: 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 ofthe 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 obligation is based on an actuarial valuation as ofJune 30, 1995. Net assets available for benefits were valued as of the 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 University's contribution for the year ended June 30, 1996, of$1,480,684.29 was actuarially determined and represented .2438% of total 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 of the progress made in accumulating sufficient assets to pay benefits when due.

REGENTS RETIREMENT PLAN

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.

- 15 -

SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1996

EXHIBIT "0"

NOTE 6: RETIREMENT PLANS
REGENTS RETIREMENT PLAN
State legislation requires that the employer contnoute 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 University's payroll for employees covered by the Regents Retirement Plan for the year ended June 30, 1996, was $2,782,996.60. The University's total payroll for all employees was $15,682,207.26.
The University and the covered employees made the required contributions of $111,319.87 (4%) and $139,149.83 (5%), respectively.
GEORGIA DEFINED CONTRIBUTION PLAN
Plan Description Savannah State University participates in the Georgia Oefined Contribution Pl~ (GOCP) 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. GOCP is administered by the Board of Trustees of the Employees'Retirement System of Georgia. The University's payroll for the year ended June 30, 1996, for employees covered by GOCP was $582,377.66. The University's total payroll for all employees was $15,682,207.26.
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 $43,679.29 which represents 7.5% of covered payroll. These contributions met the requirements of the plan.

- ;1.6 -

SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 3D. 1996

EXHIBIT"D"

NOTE 7: LEAVB POLICIES
Employees earn armuaI 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 armualleave upon retirement or termination ofemployment. 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 8: 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 carmot be determined at this time although the University expects such amounts, if any, to be immaterial to its overall financial position.
Litigation, claims and assessments filed against Savannah State University (as an organizational unit of the . Board ofRegents ofthe University System of Georgia), if any, are generally considered to be actions against
the State ofGeorgia. Accordingly, significant litigation, claims and assessments pending against the State of Georgia are disclosed in the State ofGeorgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1996.
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 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 of the 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 115 employees who had retired or were disabled that were receiving these postemployment health and life insurance benefits. For the year ended June 30, 1996, Savarmah State University recognized as incurred $170,560.92 of expenditures, which was net of$68,429.76 of participant contributions.

- 17 -

SAVANNAH STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1996

EXHIBIT"D"

NOTE 10: BONDING INFORMATION

The President and all employees of Savannah State University 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 1, 1996. Under this agreement, the public employee dishonesty coverage insures Savannah State University to a maximum of $1,000,000.00 against loss sustained through fraudulent or dishonest acts by its. employees. The faithful performance of duty coverage insures the University 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 ofSavannah State University 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 1, 1996. Under these additional public employee dishonesty coverages, the policies insure the University 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 11: ENROLLMENT

The equivalent full-time student enrollment of Savannah State University was as follows:

Regular Term Fall Quarter, 1995 Winter Quarter, 1996 Spring Quarter, 1996

3,035 2,954 2.812

Average

Summer School, 1995

- 18 -

SUPPLEMENTARY INFORMATION - 19 -

SAVANNAH STATE UNIVERSITY COMBINING BALANCE SHEET CURRENT FUNDS - UNRESTRICTEP
JUNE 30 1996

EXHIBIT "E-

See notes to the financial statements.

- 20-

SAVANNAH STATE UNIVERSITY COMBINING STATEMENT OF CHANGES IN FUND BALANCES
CURRENT FUNDS - UNRESTRICTED yEAR ENDED JUNE 30. 1996

EXHIBIT -P

REVENUES AND OTHER ADDITIONS
Unrestricted Current Fund Revenues Adjustments
PriorYears' ExpencfltureslAccounts Payable Prior Years' Checks Voided
Total Revenues and Other Additions
EXPENDITURES AND OTHER DEDUCTIONS
Educational and General Expenditures Auxiliary Enterprises Expenditures Remittances to the Board of Regents of the
University System of Georgia Prior Year's Unrestricted Fund Balance (SurplUS)
Adjustments Prior Years' Revenues/Accounts Receivable
Total Expenditures and Other Deductions
TRANSFERS BETWEEN FUNPS
Nonmandatory Renewals and Replacements
Net Increasel(Decrease) for the Year
FUNp BALANCES JULy 1. 1995

RESIDENT LOITERYFOR AUXILIARY

STUDENT

INSTRUCTION EDUCATION ENTERPRISES ACTIVITIES

TOTAL

$ 21,357,327.99 $ 275,867.00 $ 4,475,344.61 $ 242,727.87 $ 26,351,267.47

1,643.40 1,792.74

147.24 1,085.00

7,159.73 3,730.80

8,950.37 6,608.54

$ 21,360,764.13 $ 275,867.00 $ 4,476,576.85 $ 253,618.40 $ 26,366,826.38

$ 21,330,945.38 $ 246,839.24

$ 281,611.94 $ 21,859,396.56

$ 4,286,695.72

4,286,695.72

14,626.35

207.00

819.00

14,626.35 1,026.00

$ 21 .345,571.73 $ 246,839.24 $ 4.286.902.72 $ 282,430.94 $ 26,161 .744.63

$ -196,055.15

$ -196.055.15

$

15,192.40 $ 29,027.76 $

-6,381.02 $ -28,812.54 $

9,026.60

100.886.21

46,502.07

486,173.91

75,630.96

709,193.15

FUND BALANCES JUNE 30. 1996

$ 116,078.61 $ 75,529.83 $ 479,792.89 $ 46,818.42 $ 718,219.75

see notes to the financial statements.

- 21 -

SAVANNAH STATE UNIVERSITY COMBINING STATEMENT OF CURRENT FUNpS REyENUES EXPENPITURES,
ANp OTHER CHANGES UNRESTRICTED
YEAR ENDED JUNE 30,1996

REyENUES
State Appropriations Tuition and Fees Federal Grants and Contracts
sales and Services of Educational Activities
Sales and Services of Auxiliary 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
Auxiliary Enterprises Student Housing Faculty and Staff Housing Food Services Stores and Shops InterCOllegiate Athletics Other Service Units
Total Expenditures
OTHER TRANSFERS AND ADDITIONSI <DEDUCTIONS)
Transfers for Renewals and Replacements 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 Additionsl(Deductions)

RESIDENT LOTTERY FOR AUXILIARY

STUDENT

INSTRUCTION EDUCATION ENTERPRISES ACTIVITIES

TOTAL

$ 15,248,855.00 $ 5,620,910.93 203,390.31 31,320.60
252,851.15
$ 21,357,327.99 $

275,867.00 $

$
4,466,887.07 8,457.54

$ 15,524,722.00

217,328.70 5,838,239.63

203,390.31

31,320.60

4,466,887.07

25,399,17

286,707.86

275,867.00 $ 4,475,344.61 $ 242,727.87 $ 26,351,267.47

$ 9,893,nO.00 $ 4,901.47
447,406.80 2,195,298.60 1,625,580.71 3,981,708.75 3,032,079.05
150,200.00
$ 21,330,945.38 $

24,564.78
121,726.82 100,547.64

$ 9,918,334.78

4,901.47

447,406.80

2,317,025.42

$ 259,671.29 1,885,252.00

4,082,256.39

3,032,079.05

21,940.65

172,140.65

$ 1,275,222.98 18,612.91
1,494,486.08 166,265.49 997,180.91 334,927.35

1,275,222.98 18,612.91
1,494,486.08 166,265.49 997,180.91 334,927.35

246,839.24 $ 4,286,695,72 $ 281,611.94 $ 26,146,092.28

$

3,436.14

-14,626.35 $ -11,190.21

$ -196,055.15

$ -196,055.15

1,025.24 $ 10,071.53

14,532,91

-14,626.35 $ -195,029.91 $ 10,071.53 $ -196,148,59

Net Increasel(Decrease) in

Fund Balances

$

29p27.76 $

-6.381.02 $ -28.812,54 $ _ _9..".,0.2.6;;,;;;;,,;;,..60.

See notes to the financial statements.

- 23-

SAVANNAHSTATEUN~RSrrv



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

$ 15.248.855.00

$ 1,177.593.00

6,108.472.99 $ 14,047.766,89

494,731.01 $ _ _.....:.;19::.l.,44~9,:.:.14~

$ 21,357,327.99 $ 14,047,766,89 $ 1,672,324,01 $

1;.;;.9.:..;..44....;.;9....;.;,1~4

EXPENDITURES
Personal Services: Education. General and Departmental Services Sponsored Operations
Operating Expenses: Education, General and Departmental Services Sponsored Operations
Capital Outlay Special Funding Initiative Office of Minority Business Enterprise

$ 16,947.007.13 $ 1.525,373,64

3.847,684.03
279,966.19 256,288,03

12,522,393.25 $ 1.579,720.26 $

490,853.34

$ 21,330,945,38 $ 14,047,766,89 $ 1,579,720.26 $ _ _..;4,.;.,90;.:,.8;.,;;5,.;.,3.,.;.,34.,;.

Excess of Revenues over Expenditures

$

26.382,61 $

(1) To eliminate tuition waivers not bUdgeted and to reclassify prior year
fund balances budgeted as revenues,

0,00 $

92,603,75 $ -===-4.7..1..,.4...0..4=';;;;,20=

See notes to the financial statements,

-24-

TOTAL

ADJUSTMENTS .. TOTAL

(1)

(Budget Basis)

BUDGET

VARIANCE FAVORABLE (UNFAVORABLE)

$ 16,426,448.00 20,670.420.03 $

$ 16.426,448.00 $ 16,426,448.00 $ 321,204.20 20,991,624.23 21,312,480.00

0.00 -32O,855.n

$ 37,096,868.03 $

321,204.20 $ 37,418,072.23 $ 37,738,928.00 $ _ _-3;;;;2O~':.;.85;;.;;5..;.;,.n.;..

$ 16,947,007.13 1,525,373.64
3,847,684.03 $ 12,522,393.25 2,070,573.60
279,966.19 256,288.03

$ 16,947,007.13 $ 16,925,153.00 $

1,525,373.64

1,507,229.00

-150,200.00

3,697,484.03 12,522,393.25 2,070,573.60
279,966.19 256,288.03

3,708,773.00 12,823,759.00 2,167,672.00
306,342.00 300,000.00

-21,854.13 -18,144.64
11,288.97 301,365.75 97,098.40 26,375.81 43,711.97

$ 37,449,285.87 $ -150,200.00 $ 37,299,085.87 $ 37,738,928.00 $ _ _4_3-,9,,-84_2_.1_3

$ -352,417.84 $

471,404.20 $ 118,986.36

$ -=........1..1.=8.=9.8.6.=.36=

-25-

SAVANNAH STATE UNIVERSITY SCHEDULE OF REVENUES AND EXpENDITURES COMPARED TO BUDGET
LOTTERY FOR EDUCATION YEAR ENDEP JUNE 30. 1996

SCHEDULE WZ'

See notes to the financial statements.

-26 -

SAVANNAH STATE UNIVERSITY SCHEDULE OF OPERATIONS LOAN FUNDS YEAR ENDED JUNE 30, 1996

SCHEDULE "3"

See notes to the financial statements.

-27 -

$

595,007.74 $

19,384.60 $

0.00 $ --=====6;,.;,14.:.1,=390;;;2;;,;;..34.

See notes to the financial statements.

- 28-

SAVANNAH STATE UNIVERSITY SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS
AGENCY FUNDS YEAR ENDED JUNE 30,1996

SCHEDULE M!r

FUND
PAYROLL DEDUCTIONS
Federal Income Tax State Income Tax F./.CA Retirement Group Insurance Tax Deferred Annuities Savings Bonds Rents Wage Earners Deductions Garnishments Credit Union Internal Revenue Service Miscellaneous
EMPLOYER'S CONTRIBUTIONS
F'/,CA Retirement Group Insurance
OTHER FUNDS
Alumni Support Program Banquet - Dr. Black Baptist Student Union Baseball Fund-Raising Program Business Advisory Board Campus Chest Career Week Program Clearing Account Community Support Program Developmental Studies Honors Program DLS Retirement Club Engineers Faculty Club Football Support Program Fours and Nines Activities Graduate Studies Hass Functions HCOP Awards Banquet International Visitor Program Library Deposits Mass Communications Fund Raising National Society of Black Engineers Olympic Legacy Passport to Export Pei-Ling Trust Pell Recoveries - Prior Year
See notes to the financial statements.

BALANCE JULY 1,1995

RECEIPTS

BALANCE DISBURSEMENTS JUNE 30,1996

$

-92,89 $ 1,656,184.64 $

547,779.92

-37.47

1,099,070,00

80,354.10

755,007.76

32,486.09

553,622.71

1,249.09

394,738.61

522.50

21,243.03

10,125.00

50,600.00

836.50

58,607.50

-282.20

65,827.01

1,034,48

875,959,00

14,989,29

652,50

16.485.91

$ 126,847,70 $ 6,110,115,38 $

1,656,091.75 547,810.73 $
1,099,032.53 831,595.03 532,698.38 396,654,18 21,200.00 60,725.00 58,105.50 64,860.51 876,993,48 14,878.02 17,100.91
6,177,746.02 $

-30.81
3,766.83 53,410.42
-666,48 565.53
1,338,50 684.30
111.27 37.50
59,217.06

$

-1.46 $ 1,099,070.06 $

220.496,64

1,596,494.07

94,543.85

1,617,742.10

$ 315,039.03 $ 4,313,306.23 $

1,099,068,54 $ 1,804,233.63 1,612,791.55
4,516,093.72 $

0,06 12,757.08 99.494.40
112,251.54

$

5,274.30 $

2,000.00

$

7,274.30

330.00

330.00

207.00

207.00

700,00

700.00

1,501.49

9,449.77 $

6,224.73

4,726,53

110.39

110.39

134.83

134.83

6,477,456.00

6,477,456.00

100.00

100.00

983.14

983.14

893.37

890.30

3.07

350.75

48.65

302.10

4,285.00

4,285.00

35.00

35.00

151.60

26.72

124,88

904.00

790.54

113.46

346.00

346.00

700.00

700.00

517.53

50.00

50.00

517.53

1,440.12

1,440.12

25.00

25.00

846.84

2,300.00

1,700.00

1,446.84

118.00

70.00

48.00

2,941.11

2,682.88

258.23

2,279.00

2,279.00

- 29-

SAVANNAH STATE UNIVERSITY SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS
AGENCY FUNDS YEAR ENDED JUNE 30, 1996

SCHEDULE "5"

FUND
OTHER FUNDS
Presidenfs Discretionary Fund Press Institute Psychology Club Quiz Bowl Radio Station Fund Raising Recruiters' Fair Regenfs Global Center Resident Hall Association Resident Hall Renovation Retired Employees~ Insurance SBS - International Forum Scholarships
Georgia Student Incentive Grants Regents' Scholarship Fund Other Scholarships (List on File) Science and Technology Program Senior Class Small Business Conference Social Work Programs SSC Alumni Weekend SSC Archives - Honors Program SSC Dance Ensemble Student Deposits Tiger Booster Club U. S. Cultural Program

BALANCE JULY 1.1995

RECEIPTS

BALANCE DISBURSEMENTS JUNE 30, 1996

$

1,660.00 $

$

3,959.72

5,305.00

193.38

5,514.50

93.97

962.00

80.00

2,952.84

15,100.00

74,607.01

575.80

20.00

300.00

11,979.91

87,341.49

504.00

179.48
41,364.16 378.35
7,284.03 -600.68 1,041.64
41.19 5.00
23,392.91 56.44
789.00

144,842.00 3,900.00
257,670.29
14,085.10 600.68
100.00 1,323.00 406,919.42
90.00

$ 122,957.80 $ 7,508,084.07 $

520.13 $ 6,386.66
193.38 2,661.35
836.02 3,032.84 86,194.80
235.05
88,135.65 504.00
143,195.00 3,400.00
283,439.32 378.35
20,688.24
1,041.64 41.19
.399,782.30 56.44
7,535,486.52 $

1,139.87 2,878.06
2,853.15 219.95
3.512.21 360.75' 300,00
11,185.75
1,826.48 500.00
15,595.13
680.89
105.00 1,323.00 30,530.03
879.00
95,555.35

$ 564,844.53 $ 17,931,505.68 $ 18,229,326.26 $ 267,023.95

See notes to the financial statements.

- 30-

SAVANNAH STATE UNIVERSITY CASH AND CASH EQUIVALENTS
JUNE 30, 1996

SCHEDULE "6"

INTEREST BEARING ACCOUNTS
Carver State Bank, Savannah, Georgia
Certificates of Deposit (4.29% - 4.48%)
SunTrust Bank, Savannah, Georgia
N.O.W. Account. (2.12%)
SunTrust Bank, Atlanta, Georgia
Cash Management Pool Board of Regents Short-Term Investment Fund
OTHER
Cash on Hand Petty Cash

$ 469,294.51 919,703.59 667,474.70 $ 2,056,472.80
16,760.00 $ 2,073,232.80

See notes to the financial statements.

- 31 -

SAVANNAH STATE UNI\IERSITY
ACCOUNTS RECEIVABLE JUNE30 1996

SCHEDULE "r

CURRENT FUNDS UNRESTRICTED RESTRICTED

LOAN FUNDS

PLANT FUNDS UNEXPENDED

AGENCY FUNDS

TOTAL

Federal Grants and Contracts Research and Instruction Student Aid Plant Additions

$ 617,440.28 421,829.53

$ 476,083.68

$ 617,440.28 421,829.53 476,083.68

State Grants and Contracts Research and Instruction

29,835.74

29,835.74

Local Grants and Contracts Plant Additions

532,296.33

532,296.33

Private Gifts, Grants, and Contracts Research and Instruction

21,769.27

21,769.27

Other

Deparbnent of Administrative Services

$

Georgia State Financing and Investment

Commission

Returned Checks

Student Accounts

Student Notes

Other

2,141.78
45,784.90 17,708.63 128,713.50
40,287.00

$ 789,247.55

38,494.25 $

697.29

2,141.78
84,279.15 17,708.63 128,713.50 789,247.55 40,984.29

$

234,635.81 $ 1,090,874.82 $ 789,247.55 $ 1,046,874.26 $ _ _=69;.;,,7;;;,.29= $ 3,162,329.73

See notes to the financial statements.

- 33-

SAVANNAH STATE UNIVERSITY CHANGES IN INVESTMENT IN PLANT
YEAR ENDED JUNE 30, 1996

Land Buildings Improvements Other Than Buildings Equipment Library Books and Collections

BALANCE JULY 1! 1995

CURRENT FUNDS UNRESTRICTED' RESTRICTED

$ 325,975.16

29,851,598.37

6,548,050.76

5,709,085,42 $

821 ,428.36 $ 494,088.67

3,734,963.94

270,862.94

18,694.20

$ 46,169,673.65 $ 1,092.291.30 $ 512,782.87

See notes to the financial statements. .

- 34-

SCHEDULE "8"

ADDITIONS

GEORGIA STATE

PLANT FUNDS

FINANCING AND

RENEWALS AND INVESTMENT

UNEXPENDED REPLACEMENTS' COMMISSION

DEDUCTIONS DISPOSALSI DELETIONSI ADJUSTMENTS

BALANCE JUNE 30. 1996

$ 325,975.16

$ 933,381.77 $

259,493.60 $

210,958.75

31,255,432.49

634,792.67

11,174.65

7,194,018.08

192,784.82

220,185.09

$

543,099.05

6,894,473.31

7,000.00

4.017,521.08

$ 1.760.959.26 $

490.853.34 $

210,958.75 $

550,099.05 $ 49,687.420.12

- 35-

SAVANNAH STATE UNIVERSITY SCHEDULE OF FUND BALANCES CURRENT FUNDS AND PLANT FUNDS
JUNE 30,1996

NET INVESTMENT IN PLANT Investment in Plant Facirlties
RESTRICTED Designated for Subsequent Years' Expenditures
UNRESTRICTED Designated For Bus Replacement Reserve For Equipment, Technology and Construction Trust Fund For Special Funding Initiatives For Intercollegiate Athletics For Inventory Reserve For Renewals and Replacements Reserve For SUbsequent Years' Expenditures For Uncollectible Accounts Undesignated Surplus Regular Lottery for Education

RESIDENT INSTRUCTION

CURRENT FUNDS UNRESTRICTED LOTIERYFOR AUXILIARY EDUCATION ENTERPRISES

STUDENT ACTIVITIES

$

48,989.65

26,540.18

$ -208,044.30

$

55,787.n

632,613.99

10,822.70

25,266.06 $ 29,957.14

46,818.42

49,468.14 $ 116,078.61 $

0.00 75,529.83 $

479l92.89 $

46,818.42

$ 116,078.61 $

75,529.83 $ 479,792.89 $===4=6,:=81=8,;,,;.4.2...

See notes to the financial statements.

- 36-

SCHEDULE "9"

RESTRICTED

PLANT FUNDS

UNEXPENDED

LOTIERY FOR RENEWALS AND

REGULAR

EDUCATION REPLACEMENTS

INVESTMENT IN PLANT

TOTAL

$ 49,687,420.12 $ 49,687,420.12

$ 155,673.01

$ 155,673.01

$

20,715.32

378,306.78

$

20,715.32

48,989.65 26,540.18 -208,044.30 688,401.76 378,306.78 72,084.48 40,779.84

$

96,332.75

_____ $

$

96,332.75 $

$ 155,673.01 $

96,332.75 $

---=0"""0.=.O 0.00 $ _ _...::3.;:.;99:J.,O::.:2::2:..:..1.=..0

145,800.89 0.00
$ 1,213,574.60

0.00 $

399,022.10 $ 49,687,420.12 $ 51,056,667.73

- 37-

SAVANNAH STATE UNIVERSITY SCHEDULE OF REVENUES CURRENT FUNDS YEAR ENDED JUNE 30, 1996

See notes to the financial statements.

$ 21,357,327.99 $ 275,867.00 $ 4,475,344.61 - 38-

SCHEDULE "10"

STUDENT ACTIVITIES

TOTAL

. RESTRICTED RESIDENT
INSTRUCTION

TOTAL

$ 14,642,513.00 306,342.00 300,000.00 275,867.00
$ 15,524,722.00

$ 14,642,513.00 306,342.00 300,000.00 275,867.00
$ 15,524,722.00

$ 5,470,710.93

$ 217,328.70

367,528.70

$ 5,470,710.93 367,528.70

$ 3,368,415.44 9,808,022.33
203,390.31

3,368,415.44 9,808,022.33
203,390.31

139,701.78 540,792.10

139,701.78 540,792.10

95,584.74 93,620.50

95,584.74 93,620.50

31,320.60 4,466,887.07

1,630.00

1,630.00 31,320.60 4,466,887.07

25,399.17

29,916.00 37.82
112,609.42 14,015.97 22,597.50 1,761.00
105,770.15

29,916.00 37.82
112,609.42 14,015.97 22,597.50 1,761.00
105,770.15

$ 242,727.87 $ 10,826,545.47 $ 14,047,766.89 $ 24,874,312.36

$ 242,727.87 $ 26,351,267.47 $ 14,047,766.89 $ 40,399,034.36 - 39-

SAVANNAH STATE UNIVERSITY SCHEDULE OF EXPENDITURES BY OBJECT
CURRENT FUNDS YEAR ENDED JUNE 30,1996

RESIDENT INSTRUCTION

LOTTERY FOR EDUCATION

UNRESTRICTED AUXILIARY
ENTERPRISES

STUDENT ACTIVITIES

TOTAL

RESTRICTED RESIDENT
INSTRUCTION

TOTAL

$ 14,155,498.07 $ 1,249,756.73 $ 15,405,254.80

998,706.35 1,450,331.74 1,527,198.40
160,176.33 7,736.00
122,958.00

82,435.99 121,823.47 71,357.45

1,081,142.34 1,572,155.21 1,598,555.85
160,176.33 7,736.00
122,958.00

$ 18,422,604.89 $ 1,525,373.64 $ 19,947,978.53

$

2,286.76 $ 229,409.47$

79,597.22 $ 309,006.69

62,829.42

62,829.42

41,915.26

651,651.94

109,196.76

760,848.70

2,320.45

425,350.10

57,507.73

482,857.83

1,120,081.26

1,120,081.26

8,948.98

75,968.29

8,334.44

84,302.73

210.00

86,516.41

1,270.25

87,786.66

21,940.65 85,744.50 25,541.46

57,078.00 584,048.85 611,725.04 138,393.93

308,415.97 10,444,064.93
378,525.85 14,811.31

365,493.97 11,028,113.78
990,250.89 153,205.24

5,930.98 884.32
3,500.00 1,310.92

201,483.76 18,191.n 6,500.00 254,152.41

161,686.08 71,282.04
17,116.91

363,169.84 89,473.81 6,500.00 271,269.32

65,420.19

316,499.94 1,336,417.33

117,006.68 240,794.21

433,506.62 1,5n,211.54

15,657.47

1,500.00 762,596.01

28,500.00 484,282.87

30,000.00 1,246,878.88

$ 281,611.94 $ 6,940,393.93 $ 12,522,393.25 $ 19,462,787.18

$

38.00

4,893.50 2,002.00

140,578.92

$ 147,512.42

$ 204,790.55
13,265.69 19,994.66 15,473.85
$ 253,524.75

$

38.00

4,893.50 2,002.00

140,578.92

$ 147,512.42

$ 204,790.55
13,265.69 19,994.66 15,473.85
$ 253,524.75

- 41 -

SAVANNAH STATE UNIVERSITY SCHEDULE OF EXPENDITURES BY OBJECT
CURRENT FUNDS yEAR ENDED JUNE 30. 1996

UNRESTRICTED

RESIDENT LOTIERY FOR

AUXILIARY

INSTRUCTION EDUCATION ENTERPRISES

SPECIAL FUNDING INITIATIVES Other Costs Travel SuppUes and Materials Repairs and Maintenance Rents (Other than Real Estate) Other Expenses Publications and Printing Equipment Non-Inventory Telecommunications Equipment Inventory
OFFICE OF MINORITY BUSINESS ENTERPRISE Personal Services Salaries and Wages Employer's Contributions for: F.I.C.A. Retirement Group Insurance
Other Costs Travel Supplies and Materials Repairs and Maintenance Rents (Other than Real Estate) Other Expenses Publications and Printing Equipment Non-Inventory Software Telecommunications Per Diem, Fees and Contracts Per Diem and Fees EqUipment Motor Vehicle Purchases Inventory

s

5.961.44

4,625.69

818.47 S

2,824.00

702.00

2,564.00

980.00

2,369.66 2,070.18

5,053.59 5,442.70

6.350.00

86.006.53

s

279,966.19 $_.....;:;99;:;.&.~326=.8=-2

$

72.161.91

5,420.41 6,510.60 3.317.80

$

87,410.72

13.953.20 13,452.73 6,690.56 5.500.45 5,534.15
432.00

12,999.67 480.00
12,928.09

1.646.62

32.492.00 62,767.84

$ 256,288.03

$ 536,254.22 $

246.839.24

$ 21,330,945.38 $ 246,839.24 $ 4,286,695.72

See notes to the financial statements.

-42-

SCHEDULE-W

STUDENT ACTIVITIES

TOTAL

RESTRICTED RESIDENT
INSTRUCTION

TOTAL

$

5,961.44

4,625.69

3,642.47

702.00

2,564.00

980.00

7,423.25 7,512.88

92,356.53

$ 379,293.01

$

5,961.44

4,625.69

3,642.47

702.00

2,564.00

980.00

7,423.25 7,512.88

92,356.53

$ 379,293.01

$

72,161.91

5,420.41 6,510.60 3,317.80

$

87,410.72

13,953.20 13,452.73 6,690.56 5,500.45 5,534.15
432.00

12,999.67 480.00
12,928.09

1,646.62

32,492.00 62,767.84

$ 256,288.03

$ 783,093.46

$

72,161.91

5,420.41 6,510.60 3,317.80

$

87,410.72

13,953.20 13,452.73 6,690.56 5,500.45 5,534.15
432.00

12,999.67 480.00
12,928.09

1,646.62

32,492.00 62,767.84

$ 256,288.03

$ 783,093.46

$ 281,611.94 $ 26,146,092.28 $ 14,047,766.89 $ 40,193,859.17

-43-

SAVANNAH STATE UNIVERSITY SCHEDULE OF EXPENDITURES BY OBJECT
PLANT FUNDS
YEAR ENDED JUNE 30, 1996

CAPITAL OUTLAY
Supplies and Materials Repairs and Maintenance Other Expenses Software Equipment
Non-Inventory Per Diem, Fees and Contracts
Per Diem and Fees Equipment
Inventory

UNEXPENDED

LOTIERY FOR

REGULAR

EDUCATION

RENEWALS AND REPLACEMENTS

TOTAL

$ $ 1,496,000,73
448,32 40,275.00 42,996.21

1,186,82 $ 13,520,00
258.72 3,07522 13,409,63
149,788.61

95,184,38 $ 107,748,30
2,192,00

96,37120 1,617,269,03
2,450,72 3,075,22

61,080,56

74,938,51

4,463.01

44,738,01

220,185.09

412,969,91

$ 1,579,720.26 $ 181,239.00 $

490,853.34$ 2,251,812,60

See notes to the financial statements.

- 44-

SAVANNAH STATE UNIVERSITY RECONCILIATION OF SALARIES AND WAGES. AND TRAVEL
YEAR ENDED JUNE 30.1996

SCHEDULE -13-

Totals per Annual Supplement

Accruals June 30,1996 June 30,1995

Adjustments

Shared Services on Jointly Staffed Personnel

Armstrong State College

Awan,

Ijaz A.

Eason,

Thomas E.

Ide,

Christopher

Richardson, Joseph

Smith,

Steven

. Tapp,

Carl

Thomas,

George

Washington, Daniel

Georgia Southern University

Immele,

Rene

Oliver,

Christine

Other

Campbell,

Robert

SALARIES AND WAGES
$ 15,701,014.17 $

TRAVEL 328,832.83

23,019.70 -11,194.50

-2,150.00 -9,742.00
-10.00 -11,152.41
-75.00 -1,650.00
-187.50
~27.50
-1,200.00 -4,437.70

88.50

Totals per Report

$ 15,682,207.26 $ 328,921.33

DISTRIBUTION BY FUND
CURRENT FUNDS Unrestricted Resident Instruction Regular Special Funding Initiative Office of Minority Business Enterprise Auxiliary Enterprises Student Activities Restricted Resident Instruction

$ 12,971,036.96 $ 204,790.55 72,161.91
1,184,461.11
1,249,756.73

167,943.85 5,961.44
13,953.20 59,178.86
2,286.76
79,597.22

$ 15,682,207.26 $ 328,921.33 .

See notes to the financial statements.

- 45-

SAVANNAH STATE UNIVERSITY RECONCILIATION OF PER DIEM AND FEES
YEAR ENDED JUNE 30,1996

Totals per Annual Supplement
Adjustments C & M Environmental & Geotechnical Services Hanson Architects PC Keaton Land Surveying

TYPE PAYMENT
Consultant Consultant Consultant

FEE AMOUNT

EXPENSE AMOUNT

$ 403,350.12 $ 48,003.92 $

TOTAL 451,354.04

4,950.00 21,704.20
1,883.01

4,950.00 21,704.20
1,883.01

Totals per Report

$ 431,887.33 $ 48,003.92 $ 479,891.25

DISTRIBUTION BY FUND
CURRENT FUNDS Unrestricted Resident Instruction Regular Office of Minority Business Enterprise Auxiliary Enterprises Student Activities Restricted Resident Instruction
PLANT FUNDS Unexpended RegUlar Renewals and Replacements

$ 164,648.41 1,646,62
86,431,34 65,420.19
117,006.68
40,275.00 4,463.01

$ 479,891.25

See notes to the financial statements.

-46-

SECTIONn FINDINGS AND IMPROPER OR QUESTIONED COSTS

SAVANNAH STATE UNIVERSITY SCHEDULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS
YEAR ENDED JUNE 30, 1996

STATUS OF PRIOR YEAR FINDINGS AND IMPROPER OR QUESTIONED COSTS

The status of the findings disclosed in the review report for the year ended June 30, 1995, is summarized below:

Audit Control Number

Status ofFindings

548-95-01 548-95-02 548-95-03 548-95-04

See Audit Control Number 548-96-01 See Audit Control Number 548-96-02 See Audit Control Number 548-96-03 Corrective Action Implemented

PRIOR YEAR

REVENUEIRECEIVABLESIRECEIPTS Student Accounts Receivable Not Supported by Financial Aid Financial Statements Audit Control Number 548-96-01

The review report for the year ended June 30, 1995, disclosed that Savannah State University had $53,973.09 in student accounts receivable which were not supported by approved financial aid. On June 30, 1996, the balance had decreased to $47,832.90. There is no provision in the policies of the Board of Regents for deferments ofstudent accounts without the student having approved financial aid at the time of registration.

Collections ofstudent accounts receivable should be made on at least a quarterly basis, and no student should be granted a deferment without having approved financial aid. It is recommended that legal means be used to collect all student accounts receivable, if necessary.

PRIOR YEAR/CURRENT YEAR

EXPENDITURESILIABILITIESIDISBURSEMENTS Deficit Cash Balance Financial Statements Audit Control Number 548-96-02

The review report for the year ended June 30, 1995, disclosed that Savannah State University had a negative fund balance of $133,898.56 in the Restricted Funds - Naval Science Scholarship Account that was not supported by a valid accounts receivable. On June 30, 1996, the account had a negative fund balance of $135,938.56. The negative balance occurred because the University awarded Naval Science Scholarships without obtaining funding approval.

The University should implement procedures to fund this deficit and ensure that Naval Science Scholarships are not awarded until funds are available.

- 1-

SAVANNAH STATE UNIVERSITY SCHEDULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS
YEAR ENDED JUNE 30. 1996
PRIOR YEAR/CURRENT YEAR
FUND BALANCE Deficit to be Funded from Subsequent Years' Operations Financial Statements Audit Control Number 548-96-03
The review report for the year ended June 30, 1995, disclosed that Intercollegiate Athletics had a deficit fund balance of $318,347.18. At June 30, 1996, a deficit of $208,044.30 continued to exist. This deficit is the result ofthe University's lack ofsufficient funds to meet obligations on a current basis. The Board ofRegents' Policy Manu~ Section 702.02 states that auxiliary enterprises "shall be placed on a self-supporting basis, and the State will not make an appropriation to finance its operations".
The University should take appropriate action to fund this deficit.
CURRENT YEAR
CASH AND CASH EQUIVALENTS Uncollateralized Deposits Financial Statements Audit Control Number 548-96-04
At June 30, 1996, the University failed to have its certificates of deposit fully collateralized as provided for by the Official Code of Georgia Annotated Section 50-17-59.
This noncompliance occurred due to management's failure to adequately monitor the collateralization of balances at individual banks. The University should implement adequate procedures to monitor the collateralization of bank balances to ensure compliance at all times with State Laws governing deposits.
INVENTORIES Inadequate SupplylResale Inventory Records Financial Statements Audit Control Number 548-96-05
A review of the supply/resale inventory reco~ds as of June 30, 1996, revealed that the internal accounting control procedures for the supply and resale perpetual inventory system were deficient. The following is a summary ofthe deficiencies:
(1) The University does not have written policies and procedures for the concession, bookstore, and plant operations inventories.
(2) The method used for physical inventory counts for the bookstore inventory and plant operations inventory at fiscal year end were ineffective and therefore could not be relied upon.
- 2-

SAVANNAH STATE UNIVERSITY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30. 1996

CURRENT YEAR

INVENTORIES Inadequate SupplylResale Inventory Records Financial Statements Audit Control Number 548-96-05

These deficiencies are a result ofmanagement's failure to have written policies and procedures and to ensure inventories are properly maintained. The University should develop and implement procedures to ensure that iriventories are properly maintained and that physical inventory counts are performed in a reliable manner.

GENERAL FIXED ASSETSIPROPERTY MANAGEMENT General Ledger Not Supported by Subsidiary Records Financial Statements Audit Control Number 548-96-06

A review of the subsidiary equipment inventory records as of June 30, 1996, revealed that an unidentified variance of$364,089.76 existed between the subsidiary equipment inventory records and the general ledger. The University was unable to provide a reconciliation to account for the variance.

This variance was a result ofmanagement's failure to properly record inventory transactions on the subsidiary records and their failure to reconcile the subsidiary equipment inventory records to the general ledger. The University should implement procedures to ensure that the subsidiary equipment inventory records are reconciled to the general ledger accounting records.

FEDERAL FINANCIAL REPORTS Federal Cash Transactions Report Not Reconciled to Accounting Records Pell Grant Program (CFDA 84.063) Federal Financial Assistance Audit Control Number 548-96-07

For the year under review, our examination of the University's Federal financial reports disclosed that the expenditures reported through June 30, 1996, on the Federal Cash Transactions Report (Form PMS 272-A) were not in agreement with the accounting records as indicated below:

Grant Program

Expenditures Per
Report (pMS 272-A)

Expenditures Per
Accounting Records

Difference

Pell FY96

$3,272,759.44 $3,495,774.64 $ -223,015.20

- 3-

SAVANNAH STATE UNIVERSITY SCHEDULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS
YEAR ENDED JUNE 30. 1996 CURRENT YEAR FEDERAL FINANCIAL REPORTS Federal Cash Transactions Report Not Reconciled to Accounting Records Pell Grant Program (CFDA 84.063) Federal Financial Assistance Audit Control Number 548-96-07 T.he $223,015.20 difference for the FY 96 Pell Grant Program was the result of management's failure to reconcile reports to the U. S. Department ofEducation with the accounting records. The University should implement procedures to ensure that reported expenditures are reconciled to the UniversitYs formal accounting records. The University should contact the Federal grantor agency regarding resolution ofthe unreconciled difference.
- 4-