Southern Polytechnic State University, Marietta, Georgia, independent accountant's report on applying agreed-upon procedures for the fiscal year ended June 30, 2007

STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
I
SOUTHERN POLYTECHNIC STATE UNIVERSITY MARIETTA, GEORGIA
INDEPENDENT ACCOUNTANTS REPORT ON APPLYING AGREED-UPON PROCEDURES
FOR THE FISCAL YEAR ENDED JUNE 30, 2007
Russell W. Hinton State Auditor

SOUTHERN POLYTECHNIC STATE UNIVERSITY - TABLE OF CONTENTS -
INDEPENDENT ACCOUNTANT'S REPORT ON APPLYING AGREED-UPON PROCEDURES EXHIBIT
A BUDGET COMPARISON AND SURPLUS ANALYSIS REPORT

RUSSELL W. HINTON
STATE AUDITOR
(404) 658-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
November 20, 2007

Members of the Board of Regents of the University System of Georgia Honorable Lisa A. Rossbacher, President Southern Polytechnic State University
Independent Accountant's Report on Applying Agreed-Upon Procedures
Ladies and Gentlemen:
We have performed the procedures enumerated below, which were agreed to by the University and the University System Office (Oversight Unit) ofthe Board ofRegents ofthe University System of Georgia, solely to assist you in assessing the accuracy of the financial information reported to the University System Office in the University's 2007 Annual Financial Report for inclusion in the State ofGeorgia's Comprehensive Annual Financial Report (CAFR) and Single AuditReport; and to assist you in assessing the accuracy of the budget basis information provided in the Budget Comparison and Surplus Analysis Report, which is attached as Exhibit A. This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of the parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose.
1. Review selected balance sheet items reported on the Annual Financial Report (cash, accounts receivable, accounts payable, deferred revenues, net assets). Confirm that these items have adequate supporting documentation and are properly reconciled to the University's general ledger.
A detailed listing was not provided to support Accounts Receivable balances of $44,768, Accounts Payable balances of$1,041, Deposits balances of$7,817, and deferred revenue balances of $110,641.
A deferred revenue balance on the Annual Financial Report included $22,588 for the previous fiscal year that should have been recognized as revenue in the current fiscal year.

2. Obtain the University's GAAP basis Statement of Net Assets and Statement of Revenues, Expenses and Changes in Net Assets (SRECNA) submitted for inclusion in the State's CAFR and Single Audit. Utilizing test scripts, confirm that financial information presented in these statements properly supports activity reported in the University's accounting records.
Net Assets were incorrectly reported on the Statement of Net Assets. Nonexpendable Restricted Net Assets were overstated by $87,386 and Expendable Restricted Net Assets were understated by $87,386.
3. Obtain the University's Statement ofCash Flows submitted for inclusion in the State's CAFR and Single Audit. Utilizing cash flow worksheets, confirm information reported on Statement of Cash Flows.
We did not note any exceptions as a result of our procedures.
4. Obtain the University's Notes to the Financial Statements submitted for inclusion in the State's CAFR and Single Audit. Utilizing notes worksheets and other supporting documentation confirm that note disclosures related to Cash, Investments, Accounts Receivable, Capital Assets, Long-Term Debt, Lease Obligations and Retirement Plans have been properly reported.
We did not note any exceptions as a result of our procedures.
5. Review the University's year end GAAP basis journal entries. Obtain documentation for GAAP journal entries and confirm that the entries were posted to the University's Annual Financial Report.
We did not note any exceptions as a result of our procedures.
6. Confirm that State Appropriation revenues, receivables and remittances ofprior year surplus balances have been properly recorded in the University's financial records. Prior year surplus balances should be netted against State Appropriation revenues in the GAAP basis financial statements; however, prior year surplus balances should be reflected as fund balance adjustments on the Budget basis financial statements.
We did not note any exceptions as a result of our procedures.
7. Obtain listing ofwrite-offrequests for accounts receivable less than $3,000.00 for fiscal year 2007. Confirm that these write-off requests have been approved by the State Accounting Officer and have been posted to the University's financial statements.
We did not note any exceptions as a result of our procedures.

8. Verify that the listing ofsalaries, travel, and per diem and fees reported to the Department of Audits is in accordance with O.C.G.A. 50-6-27 reconciles to amounts recorded in the University's financial statements.
We did not note any exceptions as a result of our procedures.
9. Review year end Budgetary Statements including the Budget Comparison and Surplus Analysis Report (Exhibit A). Confirm that budget information presented in these statements supports activity reported in the University's accounting records and determine ifany budget overexpenditures exist.
We did not note any exceptions as a result of our procedures.
10. Obtain documentation for Budget basis reserves reported by University on the Budget Comparison and Surplus Analysis Report (Exhibit A). Confirm that the reserves are properly documented, valid and appropriate.
We did not note any exceptions as a result of our procedures.
11. Review the H.O.P.E. Scholarship Program reconciliation between the University and the Georgia Student Finance Commission. Confirm that information reported to the Georgia Student Finance Commission has been reconciled with H.O.P.E. Scholarship activity reported on the University's financial records.
We did not note any exceptions as a result of our procedures.
12. Review the Schedule of Expenditures of Federal Awards information submitted by the University for inclusion in the Statewide Single Audit. Confirm that the information is properly presented and supported by the University's accounting records.
The University's Schedule of Expenditures of Federal Awards information did not agree with the Federal expenditure activity reflected on the University's accounting records. The University incorrectly reported the Perkins Loan Monetary Expenditures as $0 and the Perkins Loan Nonmonetary Expenditures as $238,917.31. The correct Monetary Expenditure amount was $3,982.50 and the correct Nonmonetary Expenditure amount was $318,278.28. In addition, the University did not report the Nonmonetary activity for the Federal Family Education Loan in the amount of $10,558,160.06. These items were corrected by the auditors on the Schedule of Expenditures of Federal Awards.
These agreed-upon procedures do not constitute an audit of the financial statements or any part thereof, the objective ofwhich is to express an opinion on the financial statements or a part thereof. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.

This report is intended solely for the information and use of the specified users listed above and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
~~~
ell W. Hinton, CPA, CGFM State Auditor
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EXHIBIT

SOUTHERN POLYTECHNIC STATE UNIVERSITY BUDGET COMPARISON AND SURPLUS ANALYSIS REPORT
YEAR ENDED JUNE 30, 2007

EXHIBIT"A"

REVENUES
State Appropriation State General Funds
Federal Funds Other Funds
Total Revenues
EXPENDITURES
Research Consortium Special Funding Initiative Teaching
Total Expenditures
Excess of Funds Available over Expenditures
FUND BALANCE JULY 1
Reserved Unreserved
ADJUSTMENTS
Prior Year Payables/Expenditures Prior Year Receivables/Revenues Unreserved Fund Balance (Surplus) Returned
to Office of Treasury and Fiscal Services Year Ended June 30, 2006
Non-Mandatory Transfers
FUND BALANCE JUNE 30
SUMMARY OF FUND BALANCE
Reserved Department Sales and Services Indirect Cost Recoveries Technology Fees Restricted Funds Uncollectible Accounts Receivable
Total Reserved
Unreserved Surplus
Total Fund Balance

BUDGET

ACTUAL

VARIANCEFAVORABLE (UNFAVORABLE)

$ 20,085,226.00 $ 20,085,226.00 $

3,300,000.00

3,006,503.65

17,243,333.00

16,281,150.49

$ 40,628,559.00 $ 39,372,880.14 $

0.00 -293,496.35 -962 182.51
-1,255,678.86

$

131,852.00 $

131,852.55 $

10,613.00

10,613.00

40A86,094.00

39,262,309.47

$ 40,628,559.00 $ 39,404.775.02 $

$

0.00 $

-31,894.88 $

-0.55 0.00 1,223,784.53
1,223,783.98
-31,894.88

1,804,954.59 97,363.91

19,904.16 -11,137.50
-97,363.91 269,120.00 $ 2,050,946.37

$

28,425.38

133,420.00

13,334.61

1,250,435.41

615 757.53

$ 2,041,372.93

9 573.44

$ 2,050,946.37