Audit report, state of Georgia, Valdosta State University, Valdosta, Georgia, year ended June 30, 1999

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AUDIT REPORT

STATE OF GEORGIA

VALDOSTA STATE UNIVERSITY

VALDOSTA, GEORGIA

YEAR ENDED JUNE 30,1999

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STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

VALDOSTA 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

7

D NOTES TO THE FINANCIAL STATEMENTS

8

SUPPLEMENTARY INFORMATION

E COMBINING BALANCE SHEET

CURRENT FUNDS - UNRESlRICTED

22

F COMBINING STATEMENT OF CHANGES IN FUND BALANCES

CURRENT FUNDS - UNRESlRICTED

23

G COMBINING STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES,

AND OTHER CHANGES

UNRESlRICTED

25

SCHEDULES

1 SCHEDULE OF REQUIRED SUPPLEMENTARY INFOR\'fATION

26

SCHEDULES OF REVENUES AND EXPENDITURES COMPARED TO BUDGET

2

RESIDENT INSTRUCTION

28

3

LOTTERY FOR EDUCATION

31

4 CHANGES IN INVESTMENT IN PLANT

32

5 SCHEDULE OF FUND BALANCES

CURRENT FUNDS AND PLANT FUNDS

34

6 RECONCILIATION OF SALARIES AND IRAVEL

36

VALDOSTA STATE UNNERSITY
- TABLE OF CONTENTS -
SECTIONll AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
October 28, 1999

Honorable Roy E. Barnes, Governor Members ofthe General Assembly of Georgia Members ofthe Board ofRegents ofthe University System of Georgia
and Honorable Hugh C. Bailey, President Valdosta 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) ofValdosta State University as of and for the year ended June 30, 1999. 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 ofthis departure from generally accepted accounting principles were not reasonably determinable, but are believed to be material.

99ARL-62

As disclosed in Note 1 to the financial'statements, the University did not rePort the liability and related expenditure for compensated absences in the current funds as required by generally accepted accounting principles. Ifcompensated absences were reported, liabilities would be increased and fund balance would be decreased by $2,302,376.77 as ofJune 30, 1999, and the net change in fund balance for the year ended June 30,1999, would be decreased by $269,835.42..
In our opinion, except for the effects on the financial statements of the matters discussed in the third and fourth paragraphs, the financial statements referred to above present fairly, in all material respects, the financial position ofValdosta State University as ofJune 30, 1999, and the changes in fund balances and the current operating funds revenues, expenditures, and other changes for the year then ended in conformity with generally accepted accounting principles.
The year 2000 supplementary infonnation on Schedule "1" is not a required part of the basic financial statements but is supplementary infonnation required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally ofinquiries ofmanagement regarding the methods ofmeasurement and presentation ofthe supplementary infonnation. However we did not audit the infonnation and do not express an opinion on it. In addition, we do not provide assurance that Valdosta State University is or will become year 2000 compliant, that the University's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Valdosta State University does business are or will become year 2000 compliant.
Our audit was made for the purpose offonning an opinion on the financial statements taken as a whole. The accompanying combining statements (Exhibits E through G) and the financial schedules (Schedules 2 through 6) are presented for purposes ofadditional analysis and are not a required part of the financial statements of Valdosta State University. Such infonnationhas been subjected to the auditing procedures applied in the audit ofthe financial statements and, in our opinion, except for the effects ofthe matters discussed in the third and fourth paragraphs, such infonnation is fairly presented in all material respects in relation to the financial statements taken as a whole.
Respectfully submitted,

RWH:jb 99ARL-62

sell W. Hinton State Auditor

FINANCIAL STATEMENTS
- 1-

VALDOSTA STATE UNIVERSITY COMBINED BALANCE SHEET ALL FUND GROUPS JUNE 30. 1999

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

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

LOAN FUNDS

$

4.711.790.22 $

2.253.010.23 $

763.814.04

1.229.981.19

809.843.10

100.141.56

252.947.22 596,128.75

$

6.385.588.92 $

3,482.991.42 $ -====84=9o.lO,0..7.=5';;,;97=

$

2.394.272.89 $

1.622,542.56

200.00

453.743.53 9.000.00

119.081.06

$

4,479.758.98 $

119.081.06 $

541,947.70 307.128.27

$

3.363.910.36

$

1.905.829.94

$

1.905.829.94 $

3.363.910.36 $

849.075.97

$

6.385.588.92 $

3,482,991.42 $ ........==.84;,;;90.75;;,;.9.7...

The notes to the financial statements are an integral part of this statement -2-

ENDOWMENT AND SIMILAR
FUNDS

UNEXPENDED

PLANT FUNDS RENEWALS AND REPLACEMENTS

INVESTMENT IN PLANT

AGENCY FUNDS

TOTAL (Memorandum
Only)

$

3,092,170.33 $

318,001.81 $

584,286.04

$

_ _ _ _ _ _ $ 117,967,276.45

889,880.30 $ 983.89

12,102,086.15 2,590,907.87
809,843.10 100,141.56 117,967,276.45

$

3,092,170.33 $

318,001.81 $

584,286.04 $ 117,967,276.45 $

890,864.19 $ 133,570,255.13

$

$

$

2,375,047.11

697,559.67

19,563.55

$

$

3,092,170.33 $

317,850.81 $
317,850.81 $
151.00 $ 151.00 $

200,758.72

$

$ 200,758.72 $

13,795.50 13,795.50 $

$ 383.527.32 383,527.32 $

117.953,480.95 117,953,480.95

451,394.71 $
439,469.48 890,864.19 $

3,483,358.19 1,622,542.56
200.00
453,743.53 9,000.00
439,469.48 13,795.50
6,022,109.26

$

541,947.70

307,128.27

2,375,047.11

697.559.67

19,563.55

117,953,480.95

3.363.910.36

2,289,508.26

$ 127,548,145.87

$

3,092.170.33 $

318,001.81 $

584,286.04 $ 117,967,276.45 $

890,864.19 $ 133,570,255.13

-3-

VAlDOSTA STATE UNIYERSITY COMBINED STATEMENT OF CHANGES IN FUNp BAlANCES
ALL FUND GROUPS )'EAR ENDED JUNE 30, 1999

REVENUES AND OTHER APDITIONS
Unrestricted Current Fund Revenues State Appropriations
Regular Federal Grants and Contracts State Grants and Contracts Private Gifts, Grants, and Contracts Investment Income
Endowment Other Net Increase(Decrease) of Fair Value on Investment Interest on Loans Receivable Adjustments Prior Years' Expenditures/Accounts Payable Prior Years' Checks Voided Funded by the Board of Regents of the University System of Georgia
Prior Year's Unrestricted Fund Balance (Deficit) Expended for Plant Facilities
Current Funds Plant Funds
Unexpended Renewals and Replacements Georgia State Flnanclng and Investment Commission
Total Revenues and Other Additions
EXPENDITURES AND OTHER DEDUCTIONS
Educational and General Expenditures Auxiliary Enterprises Expenditures Indirect Costs Recovered
Remittances to the Board of Regents of the
University System of Georgia PrlorYear's Unrestricted Fund Balance (Surplus)
Adjustments Prior Years' Revenues/Accounts Receivable
Loan Cancellations and WrIte-Offs Administrative and Collection Costs Expended for Plant Faclilties
Capitalized Noncapltallzed DlsposelslDeletlonS/Adjustments
Total Expenditures and Other Deductions
TRANSFERS BETWEEN FUNDS
Nonmandatory Renewals and Replacements For Capital Projects Endowment Princlpal For Object ofTrust
Transfers Between Funds
Net Increasel(Decrease) for the Year
FUND BALANCES JULY 1 1998

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

LOAN FUNDS

S

80,465,375,46

S

29.441,025,78 $

7,779,703.19

557,469,80

398,099,70

98,282,05 70.45
4,433,67

-247,463,26 4,434,83
224,60 -110,33 29,211,90

S

80,568,161,63 S

38,176.298,47 S

-213.702.26

S

69,124,381,87 S

38,086.933,30

10,411,493,67

115.663,38

37,401,23

S

-30.560,57

2,953,03

S

79,573,276,77 S

38,202,596,68 S

-27.607,54

S

-699,249,56

-89,412.55

S

1.554.147,67

S

-788,662,11 S

1,554.147.67

S

206,222,75 S

1,527,849,46 S

-186,094,72

1,699,607,19

1,836.060,90

1,035.170,69

FUND BALANCES JUNE 30, 1999

S

1,905.829,94 S

3.363.910,36 S

The notes to the financial statements are an Integral part of this statement
-4-

849.075,97

EXHIBIT"B"

ENDOWMENT AND SIMILAR
FUNDS

UNEXPENDED

PLANT FUNDS RENEWALS AND REPLACEMENTS

INVESTMENT IN PLANT

TOTAL (Memorandum
Only)

S

1.468.000.00 S

S

27,391.08

8.150.37 305.000.00

-15.743.95

417.426.03

151.00

S

11.647.13 S

2.198.727.40 S

0.00
S

S
208.885.30

80.465.375.46
1.468.000.00 29.193.562.52
7.787.853.56 1,103.181.01
398.099.70 417.650.63 -15,854.28
29.211.90
98.433.05 70.45

0.00 S

4,433.67

3,676,362.15

3,676,362.15

2.125.499.72 881.940.14
13.407.699.90

2.125.499.72 881.940.14
13.407.699.90

20.300.387.21 S 141.041.519.58

S

0.00

S 107,211.315.17
10.411,493.67
115.663.38

S

7,017.27

7.017.27

37,401.23 -30.560.57
2.953.03

2,125.499.72 S
162,489.23

881,940.14 262.452.76
S

1.413.435.n

3.007,439.86 424.941.99
1.413.435.n

S

0.00 S

2.295.006.22 S

1.144,392.90 S

1.413.435.n S 122.601.100.80

S

S

-1.554.147.67

S

-1.554.147.67 S

S

-1,542.500.54 S

4,634.670.87

S

3.092.170.33 S

S
89.412.55
89.412.55 S -6,866.27 S
7.017.27

699,249.56
699.249.56
-445.143.34 S
826.670.66

S
S 18.886,951.44 S
99.066.529.51

0.00 0.00 0.00
0.00
18,440.418.78
109.107.727.09

151.00 S

383.527.32 S 117.953.480.95 S 127.548,145.87

-5-

VALDOSTA STATE UNIVERSITY STATEMENT OF CURRENT FUNDS REVENUES, EXPENDITURES,
AND OTHER CHANGES YEAR ENDED JUNE 30, 1999

EXHIBIT .C"

Net Increasel{Decrease) in Fund Balances

$

206,222,75 $

1,527,849,46 $ ========1:!::i,7=34=r;,O..7..=2,:=.21i:::

The notes to the financial statements are an integral part of this statement -7-

vALPOSTA STATE UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS
ruNE 30. 1999

EXHIBIT "D"

NOTE 1: SUMMARy OF SIGNlFICANI ACCOUNTING POLICIES
REPORTING ENTITY Valdosta State University is one ofthirty-four (34) State supported member institutions ofhigher education in Georgia which comprise the University System ofGeorgia, an organizational unit of the State of Georgia. The accompanying financial statements reflect the operations of Valdosta State University 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. Valdosta State University does not have authority to retain unexpended State appropriations (smplus) for any given fiscal year. Accordingly, Valdosta State University is considered an organizational unit ofthe Board ofRegents ofthe University System of Georgia reporting entity for financial reporting purposes because of the significance of its legal, operational, and financial relationships with the Board of Regents as defined in Section 2100 of the Governmental Accounting Standards Board Codification of Governmental Accounting and Financial R<alorting Standards.
FUND ACCOUNTING In order to ensure observance of limitations and restrictions placed on the use ofthe resources available to the University, the accounts of the University are maintained in accordance with the principles of fund accounting. This is the procedure by which resources for various purposes are classified for accounting and reporting purposes into funds that are in accordance with activities or objectives specified. Separate accounts are maintained for each fund; however, in the accompanying financial statements, funds that have similar characteristics have been combined into fund groups. Accordingly, all financial transactions have been recorded and reported by fund group.
Within each fund group, the University's fund balance allocations and designations represent those portions ofthe fund balances that are reserved, restricted and/or designated for specific future use by legal covenants, State policies, or institutional policies.
Fund groups and funds presented in the accompanying financial statements are as follows:
CURRENT FUNDS
UNRESTRICTED - The fund used to account for those economic resources over which the University retains full control to use for purposes of performing the primary functions of the University, e.g., instruction, research, public service, etc.
RESTRICTED - The fund used to record externally restricted funds which may only be utilized in accordance with the purposes established by their source. Restricted current funds are recorded as revenues and expenditures when expended for current operating purposes.
-8-

VALDOSTA STAIB UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1999

EXHIBIT "D"

NOTE 1; SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
FUND ACCOUNTING
LOAN FUNDS
The fund used to account for resources which have been made available for financial loans to students.
ENDOWMENT AND SIMILAR FUNDS
The fund used to account for endowment funds, term 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. Term endowment funds are similar to endowment funds except that upon the passage of a stated period of time or the occurrence of a particular event, all or part of the principal may be expended. While quasi-endowment funds have been established by the University 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 of such 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 University. Net Investment in Plant is an equity account showing the total book value of physical properties belonging to the University less the amount of any indebtedness to others.
AGENCY FUNDS
The fund used to account for resources held by the University as custodian or fiscal agent for individual students, faculty, staffmembers, and organizations.
BASIS OF ACCOUNTING 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 ofCertified Public Accountants' audit guide reporting model. The modified accrual basis ofacco~tingis defined as that method ofaccounting 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 ofthe fiscal period.
-9-

VAlDOSTA STATE UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 30.1999

EXHIBIT "0"

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 of fund balance. Further, revenue recognition for expenditure-driven grants should be based upon expenditures determined in accordance with generally accepted accounting principles.
Compensated absences represent obligations of the University relating to employees' rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulated annual leave in which payment is probable and can be reasonably estimated. The compensated absences liability of $2,302,376.77 and a related net current year expenditure of $269,835.42 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 ofcurrent funds in the accompanying financial statements. This presentation is in accordance with accounting practices prescribed or permitted by statutes and regulations ofthe State of Georgia, but differs from generally accepted accounting principles in that immaterial adjustments should be reported as current period revenues and expenditures. The effect of this departure is deemed to be immaterial to the fair presentation ofthe 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 behalfofthe 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 ~ancial activities ofcurrent 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 ofincome or a statement ofrevenues and expenses.
BUDGET The Board ofRegents ofthe University System of Georgia - Administrative Central Office receives State appropriation allotments for units ofthe University System of Georgia. The appropriated budget is adopted at the Board level and represents apPt:Opriations provided by the Amended Appropriations Act of 1998-1999. The appropriated budget covers current funds and plant funds, except for Auxiliary Enterprises and Student
-10 -

VALDOSTA STATE UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1999

EXHIBIT "D"

NOTE 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES

BUDGET Activities which are not subject to appropriation. The allocation of the appropriated budget is made to the College by the Administrative Central Office. In addition, the College receives Federal funds and other funds directly and includes these funds in the budget filed with the Administrative Central Office.

A comparison of anticipated 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 Research Consortium Year 2000 Project
Lottery for Education Special Funding Initiatives

$===37::=3=,6:=5 $==4=3=9=.0=:0
$=====dl~88~.56:!:4

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 Board object class level.

CASH AND CASH EQUIVALENTS Cash and Cash Equivalents consist of petty cash, demand deposits, certificates of deposit and temporary investments in authorized financial institutions, and cash management pools that have the general characteristics ofdemand deposit accounts.

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

INVENTORIES ,Inventories of consumable supplies are recorded on the consumption method and are valued at cost on the
Combined Balance Sheet using the first-in, first-out method.

Inventories ofgoods for resale are valued at cost using the average cost method.

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

- 11-

VALDOSTA STATE UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 30. 1999

EXHIBIT "D"

NOTE 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES

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.

NOIE 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 ofGeorgia 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 of indebtedness, notes, or other obligations of the 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 ofdevelopment authorities created by the laws ofthe 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 ofaccounts provided by the Federal Deposit Insurance Corporation.

As authorized in the Official Code ofGeorgia 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 ofthe University System of Georgia) the option ofexempting demand deposits from the

collateral requirements.

.

.

-12-

VALDOSTA STATE UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1999

EXHlBIT "D"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS

STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES The treasurer of the Board of Regents is responsible for all details relative to furnishing the required depository protection for all units of the University System ofGeorgia.

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

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

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

Category 3 - Amounts collateralized with securities (at fair value) held by the pledging financial institution, or by its trust department or agent but not in the University's name, and amounts uncollateralized.

Cash Deposits

Carrying
Amount

Bank
BalanceS

Risk Categories

2

3

$ 5,758,266.20 $ 9,455,456.64 $ 4,727,071.80 $=========O~.O~O $ 4,728,384.84

CATEGORIZATION OF INVESTMENTS Investments are summarized below:

Tme ofInyestment
Board ofRegents Total Return Investment Fund Short-Term Investment Fund
Total Investments

Carrying Amount
$ 6,201,689.34 79,047.03
$ 6.280.736.37

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

-13 -

VALDOSTA STATE UNIVERSITY
NOTES TO THE FINANCIAL STAIEMENTS ruNE 30,1999

EXHIBIT "D"

NOTE 3: INVESTMENT IN PLANT

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

Land Buildings Improvements Other Than Buildings Equipment Library Books and Collections

$ 1,605,486,21 71,543,113.52 8,742,725.27 23,329,480.39 12,746.471.06

Total Investment in Plant

$117,967,276.4,2

NOTE 4: OPERATING LEASES

Valdosta State University has entered into certain agreements to lease land, buildings and equipment which

are classified as operating leases (leases on assets not recorded on the balance sheet). These leases generally

contain provisions that, at the expiration date ofthe original term of the lease, the University has the option

of renewing the lease on a year-to-year basis. Future minimum lease payments for operating leases as of

June 30, 1999, are listed below. Amounts are included only for multi-year leases and for cancellable leases

for which an option to renew for the subsequent fiscal year has been exercised.

-

Fiscal Year Ending June 30

2000

$ 719,880.00

Expenditures for rental ofland, buildings and equipment under operating leases for the year ended June 30, 1999, totaled $674,247.36.

NOIE 5: CAPITAL LEASES

Valdosta State University acquires certain copiers and 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 ofany sums under such agreements beyond the fiscal year ofexecution if appropriated funds are not available. If renewal 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, 1999, future minimum lease payments under capital leases are as follows:

-14-

YALDOSTA STATE UNNERSITY
NOTES TO THE FINANCIAL STATEMENTS JUNE 3Q, 1999

EXHIBIT "D"

NOTE 5: CAPITAL LEASES

Fiscal Year
Ending June 30

2000

$ 14.372.33

Total Future Minimum Lease Payments

$ 14,372.33

Less: Amounts Representing Interest

576.83

Present Value ofFuture Minimum Lease Payments

$ 13,795.50

NOTE 6: RISK MANAGEMENT

Valdosta State University is a participant in the Board ofRegents ofthe University System ofGeorgia Health Benefits Plan, which is a self-insurance program ofhealth and dental benefits for employees and retirees of the University System of Georgia. The University and participating employees and retirees pay premiums to the Health Benefits Plan for this health insurance coverage. The Health Benefits Plan is included in the financial statements of the Board ofRegents ofthe University System of Georgia - 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$I,OOO,OOO.OO per person and dental coverage up to an annual maximum of $1,000,00 per person. The Board ofRegents has contracted with Blue Cross Blue Shield of Georgia to process claims in accordance with the Health Benefits Plan as established by the Board ofRegents.

The Department ofAdministrative Services (DOAS) has the responsibility for the State ofGeorgia ofmaking and carrying out decisions that will minimize the adverse effects of accidental losses that involve State government assets. The State believes it is more economical to manage its risks intemallyand 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 conmiercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks. The University, as an organizational unit ofthe Board ofRegents ofthe University System ofGeorgia, is part ofthe State of Georgia reporting entity, and as such, is covered by the State of Georgia risk management program administered by DOAS. Premiums for the risk management program are charged to the various state organizations by DOAS to provide claims servicing and claims payment.

A self-insured program ofprofessional liability for its employees was established by the Board ofRegents of the University System of Georgia under powers authorized by the Official Code of Georgia Annotated Section 45-9-1. The program insures the employees to the extent that they are not immune from liability against personal liability for damages arising out ofthe performance oftheir duties or in any way connected therewith. The program is administered by DOAS as a Self-Insurance Fund.

-15 -

VALDOSTA STATE UNIVERSITY NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 1999

EXlllBII "D"

NOTE 7: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA

Plan Description Valdosta State University participates in the Teachers Retirement System ofGeorgia (IRS), a cost-sharing multiple-employer defined benefit pension plan established by the General Assembly of Georgia for the purpose of providing retirement allowances and other benefits for teachers of the State of Georgia. IRS provides service retirement, disability retirement, and survivor's benefits for its members in accordance with State statute. The Teachers Retirement System ofGeorgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

Funding Policy Employees ofthe University who are covered by IRS are required by State statute to contribute 5% of their gross earnings to IRS. The University makes monthly employer contributions to IRS at rates adopted by the IRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. For fiscal year 1999, the employer contribution rate was 11.95% for covered employees. In addition, the University contributed 3.46% to the IRS on behalf of employees electing to participate in the Regents Retirement Plan. Employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1999

100%

$ 4,137,124.86

1998

100%

$ 3,927,474.47

1997

100%

$ 3,682,575.51

REGENTS RETIREMENT PLAN

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

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

-16 -

VALDOSTA STATE UNIVERSITY
NOTES TO THE FINANCIAL STAIEMENTS
JUNE 30. 1999

EXHIBIT "D"

NOTE 7: RETIREMENT PLANS
REGENTS RETIREMENT PLAN
Funding Policy The University and the covered employees made the required contributions of $945,176.76 (8.34%) and $567,264.19 (5%), respectively. .
GEORGIA DEFINED CONTRIBUTION PLAN
Plan Description Valdosta State University 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 ofTrustees ofthe Employees' Retirement System of Georgia.
Benefits A member may retire and elect to receive periodic payments after attainment of age 65. The payment will be based upon mortality tables and interest assumptions to be adopted by the Board ofTrustees. Ifa member has less than $ 3,500.00 credited to his/her account, the Board ofTrustees has the option ofrequiring a lump sum distribution to the member in lieu ofmaking periodic payments. Upon the death of a member, a lump sum distribution equaling the amount credited to his/her account will be paid to the member's designated beneficiary. Benefit provisions are established by State statute.
Contributions and Vesting . Member contributions are seven and one-half percent (7.5%) of gross salary. There are no employer contributions. Contribution rates are established by State statute. Earnings are credited to each member's account in a manner established by the Board ofTrustees. Upon termination ofemployment, the amount of the member's account is refundable upon request by the member.
Total contributions made by employees during fiscal year 1999 amounted to $67,328.03 which represents . 8.0% ofcovered payroll. These contributions met the requirements ofthe plan.
NOTE 8: LEAVE 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, except as noted in the subsequent paragraph.
-17 -

VALDOSTA STATE UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS ruNE 3Q. 1999

EXHIBIT "0"

NOTE 8: LEAVE POLICIES

Certain employees who retire with a minimum ofthree months ofunused sick leave are entitled to additional service credit in the Teachers Retirement System of Georgia.

NOIE9: CO~ENCffiS

Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. This could result in refunds to the grantor agency for any expenditures which are disallowed under grant terms. The amount ofexpenditures which may be disallowed by the grantor cannot be determined at this time although the University expects such amounts, if any, to be immaterial to its overall financial position.

Litigatio~ claims and assessments filed against Valdosta State University (an organizational unit ofthe Board of Regents of the University System of Georgia), if any, are generally considered to be actions against the State of Georgia. Accordingly, significant litigatio~ claims and assessments pending against the State of Georgia are disclosed in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1999.

NOTE 10; PQSIEMPLOYMENT BENEIDS OTHER THAN PENSION BENEFITS

Pursuant to the general powers conferred by the Official Code of Georgia Annotated Section 20-3-31, the Board of Regents of the University System of Georgia has established group health and life insurance programs for regular employees ofthe University System ofGeorgia. 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 ofservice with the University System ofGeorgia are eligible for these postemployment health and life insurance benefits. Organizational units of the Board of Regents of the University System of Georgia pay the employer portion for group insurance for affected individuals.

As ofJune 30, 1999, there were 250 employees who had retired or were disabled that were receiving these

postemployment health and life insurance benefits. For the year ended June 30, 1999, Valdosta State

University recognized as incurred $481,932.36 ofexpenditures, which was net of$181,420.78 ofparticipant

contributions.

.

NOTE 11; ENROLLMENT

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

-18 -

VALDOSTA STATE UNNERSIIY
NOTES TO THE FINANCIAL STATEMENTS
ruNE 30. 1999

NOTE 11; ENROLLMENT
Regular Tenn Fall Semester, 1998 Spring Semester, 1999
Average
Summer School, 1998
Summer School, 1999

7,439
2a211

EXEllBIT "D"

-19 -

SUPPLEMENTARY INFORMATION - 21-

VALDOSTA STATE UNIVERSrry COMBINING BALANCE SHEET CURRENT FUNDS - UNRESTRICTED
JUNE 30, 1999

EXHIBITeo

~ Cash and Cash Equivalents Accounts Receivable Inventories Prepaid Items
Total Assets

RESIDENT INSTRUCTION

LOTTERY FOR EDUCATION

AUXILIARY ENTERPRISES

STUDENT ACTIVITIES

TOTAL

S 3,453,521,59 S
317,336,06 43,283,29 72,010.48

136,483,54 S

41,848,76 S
431,778,34 766,559,81
26,951,08

1,079,936,33 S
14,699,64
1,180,00

4,711,790,22 763,814,04 809,843,10 100,141,56

S 3,886.151,42 S

136,483,54 $ 1,267,137,99 S 1,095,815.97 S 6,385,588,92

LIABILITIES AND FUND BALANCES
Liabilities Accounts Payable Salaries Payable Student Deposits Deferred Revenue Tuition and Fees Other
Total Liabilities
Fund Balances Unrestricted

S 2,135,556.54 S
1,622,392,56 200,00
11,334,00
S 3,769,483,10 $
116,668,32

134,857,54 S
134,857,54 $ 1,626,00

115,812,81 S
150,00
442,409,53 9,000.00
567,372,34 S

8,046,00 S

2,394,272,89 1,622,542,56
200,00

453,743,53 9,000,00

8,046,00 $ 4,479,758,98

699,765,65

1,087,769,97

1,905,829.94

Total Liabilities and Fund Balances

$ 3.886,151,42 S

136,483.54 $ 1.267,137,99 $ 1,095,815.97 $ 6,385.588.92

see notes to the financial statements,

-22-

See notes to the financial statements.

-23-

See notes to the financial statements.

25

VALDOSTA STATE UNIVERSITY

SCHEDULE "1"

SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

YEAR 2000 DISCLOSURES

YEAR ENDED JUNE 30. 1999

The year 2000 issue is the result of shortcomings in many computer systems, data communications components and other equipment with embedded processor chips that might adversely affect organizations operations. The University has identified computer systems and other electronic equipment that may be affected by the year 2000 issue and are necessary to conducting University operations. The following stages have been identified as necessary to implement year 2000 compliant systems.
~wareness Stage - Encompasses establishing a budget and project plan for dealing with the year 2000 Issue.
Assessment Stage - The actual process ofidentifying all systems and individual components ofsystems to check for compliance.
Remediation Stage - The time when changes are made to systems and equipment.
Validation/Testing Stage - The process of ensuring that tl;1e changes made to systems and equipment will produce a year 2000 compliant system.
It will be necessary for the University to progress through all four ofthese stages for each computer and/or electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversely affected.
A Y2K Project Leader was appointed 18 months ago and immediately established a 14-member task force. Those members were delegated responsibility for ensuring compliance in their areas in a timely fashion.
An inventory ofcomputer systems and other equipment critical to University operations has been completed. Based on this inventory, the Universityproceeded to make deficient areas compliant. Following is a summary of systems likely to be affected by year 2000 and the status ofremediation, if any:
Financial Systems: This consists of College and University Fund Accounting System (CUPA), University System ofGeorgia (USG) payroll and Banner software. Each ofthese is standardized, centrally maintained systems of the Office of Information and Instructional Technology (OIIT) of the University System of Georgia. OIIT has certified that Banner software is compliant. CUFA upgrade and compliance was performed in September 1999. The USG and Valdosta State University implemented the PeopleSoft HR/PR system in August 1999, which is compliant. It replaced the old non-compliant USG payroll system.
Personal Computers (PC) and other computer hardware: Teams have been assigned by Valdosta State University's Information Technology department to verify that each PC is compliant and make remediation. TestingIValidation is currently 95% complete in this area and will be finalized prior to January 1,2000. The IT department, with the assistance of $225,000.00 in State funds has also remediated other PC's and related equipment throughout campus and has reported 95% compliance to the Board of Regents (BOR). At this time,' any noncompliance costs are not expected to incapacitate the University's operations.

See notes to the financial statements.

-26-

VALPOSTA STATE UNIVERSITY

SCHEDULE "1"

SCHEDULE OF REQ1JIRED SuppLEMENTARY INFORMATION

YEAR 2000 PISCLOSURES

YEAR ENDED JUNE 30. 1999

Physical Plant Equipment: Plant Operations is responsible for assessing compliance for power systems, elevators, emergency generators, chiller and hot water systems. Testing and validation of these systems is also 95% complete. Some ofthe BOR funds were used to obtain compliance in this area. Any final costs are expected to be minimal.
Because ofthe unprecedented nature ofthe year 2000 issue, its effects and the success ofrelated remediation efforts will not be fully detenninable until the year 2000 and thereafter. Management cannot completely assure that the University is or will be year 2000 ready,that the University's remediation efforts will be successful in whole or in part, or that parties with whom the University does business will be year 2000 ready.

See notes to the financial statements.

.-27 -

VALDOSTA STATE UNIVERSITY SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET
RESIDENT INSTRUCTION YEAR ENDED JUNE 30 1999

REVENUES
State Appropriations Other Revenues Retained

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

PLANT FUNDS

RENEWALS AND

UNEXPENDED

REPLACEMENTS

$

43.091,223.00

$

23.691.398.n $ _ _....;38=.0;.;;86::.:;.9::::33:=.;.;;30:;...

.$

66.782,621.n $

38.086.933.30 $

1.468.000.00 730,576.40 $
2,198,576.40 $

-:;;.0.:;;,;00:;...
~O.~OO~

EXPENDITURES

Personal Services:

Education. General and Departmental Services

$

Sponsored Operations

Operating Expenses:

Education, General and Departmental Services

Sponsored Operations

capital Outlay

Special Funding Initiative

Research Consortium

Year 2000 Project

52,402.374.22 $
14,134.467.45
900,754.06 16,623.65
209.650.00

1,146.764.34
36,940.168.96 $

$

67.663.869.38 $

38.066,933.30 $

2.287,966.95 $

1,144,392.90

2,287.988.95 $ _ _..:.i1,:.:.144.:...:.:::,3~9=2.~90:;...

Excess of Revenues over Expenditures

$

-881.247.61 $

0.00 $

-89,412.55 $ _ _".1.,.1.44";,,,;,0,;.3.9.2.9..0..

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

See notes to the financial statements.

28"

SCHEDULE .Z'

TOTAL

ADJUSTMENTS (1)

TOTAL (Budget Basis)

BUDGET

VARIANCEFAVORABLE (UNFAVORABLE)

$

44,559,223.00

$

44,559,223.00 $ 44,559,223.00 $

0.00

62,508,908.47 $ -2,687,555.50

59,821,352.97

62.213,531.00

-2,392,178.03

$ 107,068,131.47 $ -2,687,555.50 $ . 104.380,575.97 $ 106,772,754.00 $

-2,392,178.03

$

52,402,374.22

1,146,764.34

$

52,402,374.22 $ 52,403,272.00 $

1,146,764.34

1,375,137.00

14,134,467.45 $ 36,940,168.96 3,432,381.85
900,754.06 16,623.65
209,650.00

-3,921,360.95

10,213,106.50 36,940,168.96
3,432,381.85 900,754.06 16,623.65 209,650.00

10,383,049.00 38,022,351.00
3,459,650.00 903,834.00 16,250.00 209,211.00

897.78 228,372.66
169,942.50 1,082,182.04
27,268.15 3,079.94 -373.65 -439.00

$ 109,183,164.53 $ -3,921,360.95 $ 105,261,823.58 $ 106,772.754.00 $

1,510,930.42

$

-2,115,053.06 $ 1,233,805.45 $

-8.8.1.,2..4.7...6.1.

$

-.88.1.,2..4.7.6.1.

-29-

VALDOSTA STATE UNIVERSITY SCHEDULE OF REVENUES AND EXPENDITURES COMPARED TO BUDGET
LOTIERY FOR EDUCATION YEAR ENDED JUNE 30,1999

SCHEDULE "3"

REVENUES State Appropriations
EXPENDITURES Equipment, Technology and Construction
Trust Fund Special Funding Initiatives

CURRENT FUNDS UNRESTRICTED

BUDGET

VARIANCEFAVORABLE (UNFAVORABLE)

$

567,500,00 $

- - - - - - 567,500.00 $

0.00

$

414,811,46 $

415,000.00 $

152,688.54

152,500.00

188.54 -188.54

Excess of Revenues over Expenditures

$

567,500.00 $

- - - - - - 567,500.00 $

0.00

$ =====0.=00,=

$ =====0=.00=

See notes to the financial statements.

- 31 -

VALDOSTA STATE UNIVERSITY CHANGES IN INVESTMENT IN PLANT
YEAR ENDED JUNE 30. 1999

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

BAlANCE JULY 1,1998

CURRENT FUNDS

UNRESTRICTED

RESTRICTED

$

1,589,514.21

56,535,807.n $

32,176.47

7,336,499.23

251,015.27

21,972,032.72

2,119,530.02 $

216,819.61

11,688,208.28

1,056,820.78

$

99,122,062.21 $

3,459,542.54 $ ====21..6.==:,8=:1=9.=6.1...

$

99,066,529.51 $

55,532.70

3,459,542.54 $

216,819.61

$

99,122,062.21 $

3,459,542.54 $ -=====21..6.=,8..1..9...=61...

see notes to the financial statements.

-32 -

SCHEDULE "4"

ADDITIONS

PLANT FUNDS

RENEWALS AND

UNEXPENDED

REPLACEMENTS

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

15,972.00

1,227,529.10 $

339,900.28 $

13,407,699.90

822,314.76

351,058.42

59,683.86

190,981.44

$

PRIVATE GIFTS

DEDUCTIONS DISPOSALS! DELETIONS! ADJUSTMENTS
$

$ 204,395.30
4,490.00

18,162.41 1,433,962.56
3,048.00

BALANCE JUNE 30, 1999
1,605,486.21 71,543,113.52
8,742,725.27 23,329,480.39 12,746,471.06

$

2,125,499.72 $

881,940.14 $

13,407,699.90 $

208,885.30 $

1,455,172.97 $ ===1;,,;1.7.,.=96:.;7::5,2;;;,7=6.=:45=

$

2,125,499.72 $

881,940.14 $

13,407,699.90 $

208,885.30 $

1,413,435.77 $ 41,737.20

117,953,480.95 13,795.50

$

2,125,499.72 $

881,940.14 $

13,407,699.90 $

208,885.30 $

1,455,172.97 $ ===1;,,;1.7.,.=96:.;7::5,2;;;,7=6.:=45=

-33-

VALDOSTA STATE UNIVERSITY SCHEDULE OF FUND BALANCES CURRENT FUNDS AND PLANT FUNDS
JUNE 30. 1999

NET INVESTMENT IN PLANT Investment in Plant Facilities
RESTRICTED Designated for Subsequent Years' Expenditures
UNRESTRICTED Designated For Inventory Reserve For Renewals and Replacements Reserve For SUbsequent Years' Expenditures For Uncollectible Accounts For Year 2000 Project Surplus Regular Lottery for Education

RESIDENT INSTRUCTION

CURRENT FUNDS

UNRESTRICTED

LOTTERY FOR

AUXILIARY

EDUCATION

ENTERPRISES

$

63,000.00

7,474.96 34,561.00

11,632.36

$

$

116,668.32 $

$

116,668.32 $

$

766,559.81

-69,359.59 2,565.43

1,626.00 1,626.00 $

699,765.65

1,626.00 $ ===6...9;;;;9.,7..=65:=.6=:;5=

See notes to the financial statements.

-34-

SCHEDULE "S"

STUDENT ACTIVITIES

RESTRICTED

UNEXPENDED REGULAR

PLANT FUNDS RENEWALS AND REPLACEMENTS

INVESTMENT IN PLANT

TOTAL

$ 117,953,480.95 $ 117,953,480.95

$ _---:3~.3::.:6:.::;3~,9.:..;10:.:..3::.:6;..

$ _---:3~,3::.:6:.::;3~.9.:..;10:.:..3::.:6;..

$

1.087,769.97

$

$

1.:.:,.0::.:8:.:.,7:.:,.7,::69::,:;.9::.:7_

$

$

1.087.769.97 $

3.363,910.36 $

$

383,527.32

$

829,559.81

383.527.32

1.018,410.38

10,040.39

34.561.00

151.00

151.00 $

383,527.32

11,783.36 1,626.00
$ _---:2~,2::.:8:.::;9...::.5;.;;08::,:;.2::.:6~

151.00 $

383.527.32 $ 117.953,480.95 $ 123,606,899.57

-35-

VALDOSTA STATE UNIVERSITY RECONCILIATION OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30,1999

SCHEDULE "6"

Totals per Annual Supplement
Accruals June 30,1999

SALARIES $ 46,344,370.79 $

TRAVEL 830,379.74

1,622,542.56

$ 47,966,913.35 $ ===83=:0:=,3..7..=9,::74=

see notes to the financial statements.

-36-

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

VALDOSTA STATE UNNERSITY
AUDITEE'S RESPONSE
SUMMARy SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30. 1999

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-551-97-02 FS-551-98-01 FS-551-98-02

Further Action Not Warranted Partially Resolved - See Corrective Action/Responses Previously Reported Corrective Action Plan Implemented

CORRECTIVE ACTIONIRESPONSES

REVENUE/RECEIVABLES/RECEIPTS Student Accounts Receivable Not Supported by Financial Aid Finding Control Number: FS-551-98-01

The Universitypreviously implemented procedures wherein all students with accounts past due over one year are notified in writing of the balance due and are reported to a Credit Bureau. In the current fiscal year, the University began an active collections program with an established collection agency before sending past due accounts to a credit agency. The University also took action to pay offthese receivables. However, the State Department ofAudits has disallowed the transaction. The University is now investigating acceptable alternatives.

PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

551-96-04

Partially Resolved - See Corrective Action/Responses

CORRECTIVE ACTIONIRESPONSES

ELIGIBILITY Deficiencies in Awarding/Disbursing Student Financial Aid Finding Control Number: 551-96-04

The overpaid student has been notified and charged. The overpaid monies have been returned.

The two underpaid students have yet to be disbursed. Per the Department of Education, the University must submit a "Federal Pell Grant Program - Increase Award Report" to the Department since the award year under question is now closed. A certification statement is needed from the independent auditor to accompany this report. The award will be disbursed upon approval from the Department ofEducation.

The Banner System provides checking mechanisms to prevent this type of error in the future.