West Central Technical College, Carrollton, Georgia, report on review of the financial statements for the fiscal year ended June 30, 2002

G,(\
P, Boo

'

'' '
'

it I

1/1.,,

CJ

\.

' .

aoo, -;!co?.

STATE OF GEORGIA

.... ---

DEPARTMENT-OF AUDITS'AND ACCOUNTS

I

,

,

,..'

'

c'

. '

/

,-

I

/

.'

. '

I

\
WEST CENTRAL TECHNICAL COLLEGE

,, ,

I ,

, CARROLLTON, GEO,RGIA ,..
'

REPORT ON REVIEW

, OF THE FINANCIAL STATEMENTS

,"

,,

I \

FOR THE FISCAL YEAR ENDED JUNE 30, 2002

' '

I

' '

,' .

'

' '

Russell W. Hinton State Audito' r

' .

WEST CTh"TRAL TECHNICAL COLLEGE - TABLE OF CONTE'.\'TS -

SECTION!

FINANCIAL

INDEPENDENT ACCOUNTANT'S COMBINED REPORT ON REVIEW OF BASIC FIKANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

REQUIRED SUPPLEMENTARY INFORMATION

MANAGEMENT'S DISCUSSION AND ANALYSIS

2

BASIC FINANCIAL STATEMENTS

EX'1IIBITS

A STATEMENT OF NET ASSETS

II

B STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS

12

C STATEMENT OF CASH FLOWS

13

D NOTES TO THE FINANCIAL STATEMENTS

14

SUPPLEMENTARY INFORMATION

SCHEDULES

SCHEDULE OF FUNDS AVAILABLE M'D EXPENDITURES

COMPARED TO BUDGET - (NON-GAAP BASIS)

BUDGET FUND

"A" DEPARTMENT OF TECHNICAL M'D ADULT EDUCATION

29

2 RECONCILIATION OF SALARIES AND TRAVEL

30

SECTION II AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS

WEST CENTRAL TECHNICAL COLLFGE -TABLE OF CONTENTS-
SECTION ill CURRENT YEAR FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

R1,.,.t11 \\. H1, ro,
STATE AUDITOR (ACA 6~ 217A

DEPARTMENT OF AUDITS AND ACCOUNTS
2.c:;.i WJ,hingtnn ~1rcel, ~ W Su11c 114 AtlJntJ Gcorg1J l0334-8400

October 23, 2002

Honorable Sonny Perdue, Governor Members of the General Assembly of Georgia Members of the State Board ofTechmcal and Adult Education Members of the Local Board of D1Tectors
and Honorable Janet Ayers. President West Central Techmcal College
INDEPENDENT ACCOUNTAJ\1T'S COMBINED REPORT ON REVIEW OF BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
Ladies and Gentlemen
We have reviewed the accompanymg baste financial statements (Exh1btts A through D) of West Central Techmcal College, an orgamzattonal umt of the State of Georgia, as of and for the year ended June 30, 2002, m accordance with Statements on Standards for Accountmg and Review Services issued by the Arnencan Institute of Certified Pubhe Accountants All mformat1on mcluded m these financial statements ts the representation of the management of West Central Techmcal College
A revtew consists pnnc1pally ofmqumes ofTechmcal College personnel and analytical procedures apphed to financial data It 1s substantially less m scope than an audit m accordance with aud1tmg standards generally accepted m the Umted States of Arnenca, the obJect,ve of which 1s the expresston of an op1mon rcgardmg the financial statements taken as a whole Accordmgly, we do not express such an op1mon
Based on our review, we are not aware of any matenal mod1ficattons that should be made to the accompanymg financial statements m order for them to be m conformity with accountmg pnnctples generally accepted m the Umtcd States of Arnenca

02ARL-6T

As descnbed m Note I, West Central Techmcal College adopted the prov1s1ons of Governmental Accounting Standards Board (GASB) Statement No 35, B,mc 1inancial Sra1eme111s - and Management's D1scusswn and Analvs1s - for Public Colleges and Umversltle~, as amended by GASB Statement No 37, Basic Financial Statements -and Management's D1Scusswn and Analvs1sfor State and Local Governments, and GASB Statement No 38, Certain Financial Statements Note D1Sclosures, as of July I, 2001, to implement a new financial reportmg model
Management's D1scuss1on and Analysis is not a reqmred pan ofthe basic financial statements but is supplementary mformat10n reqmred by the GASB We have apphed certam hm1ted procedures. which consisted pnncipally of mqumes ofmanagement regarding the methods ofmeasurement and presentatlon ofthis supplementary mformatlon, and we are not aware ofany matenal modifications that should be made thereto
Our review was made for the purpose of expressmg hmlled assurance that there are no matenal mod1ficat1ons that should be made to the financial statements m order for them to be m conformity with accountmg pnnciples generally accepted m the Umted States ofAmenca The accompany.mg supplementary mformat10n (Schedules I and 2) is presented for add1t1onal analysis purposes Such mformatlon has been subjected to the mqumes and analytlcal procedures apphed m the review ofthe financial statements, and we are not aware of any matenal mod1ficat10ns that should be made to such data
Respee<fullysbm~

RWH as 02ARL-6T

R sell W Hinton State Auditor

REQUIRED SUPPLEMENTARY INFORMATION -I-

West Central Technical College Management's Discussion and Analysis
The followmg 1s a d1scuss10n and analysis of West Central Technical College's financial performance for the fiscal year endmg June 30, 2002 Please read 1t m conJunct10n with the College's financial statements, wluch follow this section Due to the fact that the State of Georgia, mcludmg West Central Technical College, implemented the prov1s1ons of Governmental Accountmg Standards Board (GASB) Statements No 34 and 35 for the fiscal year 2002 only limited fiscal year 2001 data will be presented for comparative purposes This comparative mformatlon will be reqmred m future reports
Overview ofthe Financial Statements and Financial Ana(l'Sis
Tlus annual report consists of a senes of financial statements prepared m accordance with the rules and regulations established by the Governmental Accountmg Standards Board These financial statements differ, m both form and the accountmg pnnc1ple used, from the presentation ofpm;>r financial statements
The Statement of Net Assets used m conJunellon with the Statement of Revenues, Expenses and Changes m Net Assets contams mformatlon concemmg the College's finances and act1v1t1es as a whole and assists With prov1dmg an answer to the question "Is the College as a whole better or worse off as a result of the year's achv1t1es?" These statements mclude all assets and hab1ht1es usmg the accrual basis of accountmg, which 1s s1m1lar to the accountmg method used by corporations and other pnvate sector companies All revenues and assets are recogmzed when the service 1s provided and expenses and hab1hhes are recognized when others provide the goods or service, regardless of when cash 1s exchanged
The Statement of Cash Flows 1s a valuable tool when evaluatmg the ab1hty of the College to meet financial obhgauons as they mature This statement presents mformation related to cash mflows and outflows summanzed by operatmg, non-capital financmg, capital and related financmg and mvestmg achv1t1es
Tlus d1scuss1on and analysis of the College's financial statements provides an overview of its financial achv1hes for the year
Statement ofNet Assets
The purpose of the Statement of Net Assets 1s to present to the users of the financial statements a fiscal snapshot of the Technical College at a specific pomt m time The statement presems the assets, hab1ht1es and net assets of the College as of the end of the fiscal year Assets and hab1ht1es are reported as current and non-current and the difference between assets and hab1ht1es 1s reported as net assets. Over a penod of time the mcreases and decreases reflected m the
-2 -

Statement of Net Assets, when considered with other non-financial facts such as enrollment levels and the condition of the fac1hlles, can provide a measure to aid m dcterrnmmg whether the Techmcal College's financial posil!on 1s 1mprovmg or dctenoratmg

Net assets are d1v1ded mto three maJor categones The first category, mvested m capital assets, net of debt, provides information concernmg the College's equity m property, plant and equipment owned by the College The next asset category 1s restncted net assets Expendable restncted net assets are available for expenditure by the College but must be spent for purposes as deterrnmed by donors and/or external entitles that have placed time or purpose restnct1ons on the use of the assets The final category 1s unrestncted net assets, which are ava!lable for expenditure by the College for any lawful purpose deemed necessary to operate the College

Statement of Net Assets (thousands of dollars)

Assets Current Assets Capital Assets, Net

$ 671 35,364

Total Assets

$ 36,035

Liabilities Current L1ab1hlles Non-Current L1ab1ht1es

$ 641 276

Total Liabilities

$ 917

Net Assets Invested m Capital Assets, Net of Debt Restncted - Expendable Unrestncted

$ 35,363 53
-298

Total Net Assets

$ 35.J I8

Statement ofRevenues, Expenses and Changes in Net Assets
The purpose of the Statement of Revenues, Expenses and Changes m Net Assets 1s to present the revenues received by the College, both operatmg and nonoperatmg, and the expenses mcurred by the College, operatmg and nonoperatmg, and any other revenues, expenses, gams and losses received or spent by the College dunng the fiscal year Changes m total net assets as presented on the Statement of Net Assets are based on the mforrnat1on presented m the Statement of Revenues, Expenses and Changes m Net Assets
Operatmg revenues are received for prov1dmg goods and/or services to vanous customers and conslltuenc1es of the College Operatmg expenses are those expenses paid to acquire or produce the goods and/or seTV1ces provided m return for the operatmg revenues, and to carry out the m1ss1on of the College Therefore, nonoperatmg revenue 1s received when no goods or services

-3-

are provided m exchange for the revenue State appropnatlons and gifts were classified as operatmg revenues m prev10us reports With the issuance of Statement No 35, new gu1dehnes have been established by the Governmental Accountmg Standards Board (GASB) changmg the class1ficat10ns of state appropnatlons and gifts from operating to nonoperatmg revenue This change may result m an operatmg deficit that 1s offset by a nonoperatmg surplus

Statement of Revenues, Expenses and Changes m Net Assets (thousands of dollars)

Operatmg Revenues Operatmg Expenses

$ 4,303 16,088

Operatmg Gain/Loss

$-11,785

Nonoperatmg Revenues and Expenses

10,988

Income (Loss) Before Other Revenues and Expenses

$ -797

Other Revenues and Expenses

24,152

Increase m Net Assets

$ 23,355

Net Assets at Begmrung of Year, as Ongmally Reported

$ 7,133

Cumulative Effect of Changes m Accountmg Pnnc1ple

4,630

Net Assets at Begmnmg of Year Restated

$11,763

Net Assets at End of Year

S 35.!!8

The Statement of Revenues, Expenses, and Changes m Net Assets reflects a positive year with an mcrease m the net assets at the end of the year Some lughhghts of the mformauon presented on the Statement of Revenues, Expenses, and Changes m Net Assets are as follows

0

-4-

Revenue by Source (thousands of dollars)

Operating Revenue Tuition and Fees Grants and Contracts Sales and Services of Educational Departments Other

$ 2.791 938 525 49

Total Operating Revenue

$ 4 303

Nonoperating Revenue State Appropnations Federal Grants and Contracts - Nonoperating Gifts Investment Income Other

$ 9,080 1,406 476 34 -8

Total Nonoperating Revenue Total Revenues

$ 10,988
s 1~.221

Operating Expenses (thousands of dollars)

Operating Expenses lnstrucnon

$ 16,088

Total Operating Expenses

S 16 088

The sources of operating revenue for the College are tmtlon and fees. grants and contracts, aux1hary services. and educat10nal ac11v1nes The operating loss 1s directly related to the exclusion of the State of Georgia appropnat10n in the amount of $9,080,429 from operating revenues per GASB 35

Tuition increased by $515,149 Tlus increase 1s directly related to the increased enrollment of 18% from fiscal year 200 I

Personal Serv1ces expenses increased by approximately $900,000 This increase reflects an annual pay raise for College employees of approximately 4 5% with the associated fnnge benefits It also reflects an increased cost to the College for add1t10nal positions reqmred for the operat10n of the new Murphy Campus in Haralson County

The cumulative effects of changes in accounting pnnc1ple are the result of the College adopting deprec1at1on on capital assets and changing from the budgetary basis to the GAAP basis of accounting

-5-

Under nonoperating revenues (expenses) state appropnat1ons increased by approximately S453,297 While 11 appears that the College received add1t1onal new money from the state, given the mandatory cost increases of vanous expense categones related to the opening of the new Murphy Campus, the College actually had a relatively flat funding year when all things are considered

Statement ofCash Flows

The purpose of the Statement of Cash Flows 1s to provide relevant information concemmg the cash receipts and payments of the College dunng the year It also provides information concemmg the College's ab1hty to generate future cash flows and to meet its obhgat1ons as they come due The statement 1s d1V1ded into three sections The first section reports on the operating cash flows and shows the net cash used by the operating act1v1tJes of the College The second section shows the cash flows from the nonoperatJng act1v1t1es of the College The final section reconciles the net cash used to the operating income or loss reflected on the Statement of Revenues, Expenses, and Changes in Net Assets.

Statement of Cash Flows (thousands of dollars)

Cash Provided (Used) By Operating Act1v1t1es Non-Capital Fmancing Act1v1t1es Investing Act1v1!Jes Capital and Related Financing Activities

$-10,891 10,989 33 -69

Net Change in Cash Cash, Begmning of Year
Cash, End of Year

$ 62
96
$ )58

Capital Assets
The College had one s1g111ficant capital asset add1t1on for fac1ht1es in the fiscal year 2002 Construcuon of the Murphy Campus was completed and placed into service late in fiscal year 2002 Tuts project was funded by the Georgia State Financing and Investment Comm1ss1on (GSFIC) at a cost of $23,730,770 Other renovations funded by the GSFIC included $538,804 for equipment Projected funding by the GSFIC for fiscal year 2003 will be approximately $820,000

-6-

Economic Outlook The College 1s unaware of any currently known fact, dec1s1on, or cond11Ion that 1s expected to have a s1gmficant effect on the financial pos1uon or change how the College operates for the next fiscal year As in pnor years, the College's overall financial pos11Ion 1s strong Enrollment has increased by over 17% armually for the past three years, and this trend 1s expected to continue into the next fiscal year. As a result, the College anuc1pates the next fiscal year will be much hke the last, and the College will mamtain a close watch over resources to mamtam the ab1 h ty to react to unknown mternal and external issues
Janet Ayers, President West Central Techmcal College
- 7-

BASIC FINANCIAL STATEMENTS
-9 -

WEST CENTRAL TECHNICAL COLLEGE STATEMENT OF NET ASSETS JUNE 30. 2002
ASSETS
Current Assets Cash and Cash Equivalents Accounts Receivable, Net Federal Financial Assistance Other Prepaid Items lnventones
Total Current Assets
Non-Current Assets Caprtal Assets, Net
Total Assets
LIABILITIES
Current L1ab1lrties Salaries Payable Payroll Wrthhold1ngs Accounts Payable Deferred Revenue Funds Held for Others Compensated Absences
Total Current L1abllrt1es
Non-Current L1ab1llt1es Compensated Absences
Total L1ab1lrties
NET ASSETS
Invested in Caprtal Assets, Net of Related Debt Restncted Unrestncted
Total Net Assets

EXHIBIT "A"

$

158 214 32

30,511 24 61,047 20
7,138 00 414 531 56

$

671,442 32

35,363,603 96
s 36,035,046 28

$

13,259 50

1,755 72

2,803 97

102,120 81

158,642 69

362 074 99

$

640,657 68

276,405 09

$

917 062 77

s 35,363,603 96
52,849 74
-29847019

$ 3511798351

See Independent Accountant's Combined Report on Review of Basic Financial Statements and Supplementary Information
The notes to the financial statements are an integral part of this statement - 11 -

WEST CENTRAL TECHNICAL COLLEGE
STATEMENT OF REVENUES EXPENSES AND CHANGES IN NET ASSETS
YEAR ENDED JUNE 30 2002

EXHIBIT "B"

OPERATING REVENUES
Student Tuition and Fees Less Scholarship Allowances
Grants and Contracts Federal
Rents and Royalbes Salos am Services Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES
Salenes Benefits Travel Scholarships and Fellowshlps Ubllbes
em Supphes Other Servu:es
Deprecation
Totel Operating Expen""s
Operabng Income (Loss)
NONOPERATING REVENUES <EXPENSES}
State Appropnat1ons Grants end Contracts
Federal Gifts Interest and Other Investment Income Other Nonoperabng Revenues
Net Nonoperatrng Revenues
Income Before Other Revenues and Expenses
Gapltal Grants and Gifts State Nongovernmental
Total Other Revenues
lnaease m Net Assets
Net Assets Net Assets - Beginning of Year, as Ong1nally Reported Cumulative Effed of Changes m Accounting Pnoople
Net Assets - Begmmng of Year Restated
Net Assets - End of Year
See Independent Accountant's Combined Report on Review of Ba&IC Fmanoal Statements end Supplementary lnfonnat.10n
The notes to the finanoal statements ere en integral pert of ttus statement
- 12 -

s 292238115
-13118828
938 345 00 68 943 64
525 482 30 -20 454 52
$ 4,303,509 29

$ 8 704,513 60 1,940,359 12 15214652 807,156 72 516 573 87 3 224 538 10 742,772 14
5 16 088.060 07
5 -11 784 550 78

$ 9 080,429 28

1 406 054 64 475,919 94 33,551 09 -8 722 92

$ 10,987,232 03

$

-797 318 75

$ 24,139,974 98 12 000 00
$ 24 151 974 98 $ 23 354 656 23
s 7,133,663 41
4 629 663 87 $ 11 763 327 28

$ 3511798351

WEST CENTRAL TECHNICAL COLLEGE
STATEMENT Of CASH FLOWS
YEAR ENDED JUNE 30 2002
CASH FLOWS FROM OPERATING ACTIVITIES Turt1on and Fees Grants and Contracts Sales and Services Payments for Scholarships and Fellowships Payments to Supphers Payments to Employees Other Receipts (Payments)
Net Cash ProVJded (Used) by Operating ActJvrt,es
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES State Appropnatlons Agency Funds Transadions
Gifts end Grants Rece1Yed for Other Than Gap1tal Purposes
Net Cesh Flows ProVKted by Nonceprtal Fmencmg AclMbes
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Capital Grants and Gifts Received Proceeds from Sale of Capital Assets Purchases of Csp,tal Assets
Net Gash Used by Capital end Related Finanang Ad.Jvrues
CASH FLOWS FROM INVESTING ACTIVITIES Interest on Investments
Net lnaease m Cash
Gash and Gash Equivalents - Beglnnmg of Year
Cash and Cash Equ1Valents - End of Year
RECONCILIATION OF OPERATING LOSS TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES
OperaUng Income (Loss) Adiustments to Recondie Operating Income to Net Cesn
Provided (Used) by Operating ActJvrt,es Depreaabon ~ Change m Assets and l.Jabdrties Rece,vables Net Prepaid Items lnventones Sa1anes Payable Payroll Wrthhold1ngs and Employer Benefits Accounts Payable Deferred Revenue Compensated Absences
Net Cash Prov,ded (Used) by Clperabng Actlvrt,es
See Independent Accountant's Combmed Report on ReVJeW of Basic Fmanaal Statements and SUpplementary Information
The notes to the finendal statemenls are an integral part of this statement
- 13 -

EXHIBIT "C"

s 2 824 931 87
941,181 47 525,482 30 -807 156 72 -5 963 718 30 -8 604 308 78 19253370
s -10 891 054 46

$ 9 080,429 28 26,527 95
1 881 974 58
s 10,988,931 81

s

60,644 49

5,774 67

-13589817

s

-69 479 01

$

33 551 09

s

61 949 43

96 264 89

$

15821432

$ -1176455078
742 772 14
146 881 05 5,11920
-108 965 99 7 535 25 1 677 54
-27,931 44 33,739 00 92 669 57
S -10 891 054 46

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTE I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY West Central Techmcal College 1s one of tlurty-three (33) State supported member colleges of postsecondary educat10n m Georgia which compnse the Georgia Department ofTechmcal and Adult Education, an organ1zat1onal urut of the State of Georgia The accompanymg financial statements reflect the operauons of West Central Techmcal College as a separate reportmg entity
The Techmcal College's Local Board of Drrectors 1s composed of eleven (11) members servmg staggered three-year terms who are appomted by the State Board ofTechmcal and Adult Education Appropnatlon ofState funds 1s made to the Georgia Department ofTechmcal and Adult Education by the General Assembly of Georgia The Department's Adrrurustratlve Central Office determmes the amoW1t ofState appropnatlons to be received by West Central Techmcal College The Techmcal College does not have authonty to retam W1expended State appropnat1ons (surplus) for any given fiscal year Accordmgly. West Central Techmcal College 1s considered an organ1zat1onal W11t ofthe Georgia Department ofTechmcal and Adult Education for fmancial reportmg purposes because of the s1gn1ficance of!ls legal, operational, and financial relationships as defmed m Scct10n 2100 ofthe Governmental Accountmg Standards Board (GASB) Cod1ficat1on ofGovernmental Accountmg and Fmanc1al Reporting Standards
FINANCIAL STATEMENT PRESENTATION In JW1e 1999, the GASB issued Statement No 34, Basic Financial Statement~ and Management Discussion and Ana(vs1sfor State and Local Governments Tlus was followed m November 1999 by GASB Statement No 35, Basic Financial Statements and Management's D1scusszon and Analysis for Public Colleges and Unzversllles The State of Georgia 1s required to implement GASB No 34 as of and for the year ended JW1e 30, 2002 As an organizational WlII of the State of Georgia, the Techmcal College 1s also reqmred to adopt GASB Statements No 34 and No 35 as amended by GASB Statements No 37 and No 38 The financial statement presentation reqmrcd by these standards provide a comprehensive, entity-wide perspective of the Techmcal College's assets, hab1ht1es. net assets, revenues, expenses, changes m net assets, cash flows. and replaces the fund group perspective previously requrred
The Techmcal College has elected to not restate its 2001 financial statements to conform with the new financial statement presentation, therefore comparative fmanc1al mformauon will not be presented for fiscal year 2002 S1gn1ficant accoW1tmg changes made m order to comply WIth the new reqmrements mclude (I) adoption of depreciation on capital assets, and (2) recogmuon of compensated absences Also, generally accepted accoW1tmg pnnc1ples (GAAP) requires that the reportmg of summer school revenues and expenses be spill between fiscal years rather than m one fiscal year However, because the effect ofth1s change 1s not matenal, the Techmcal Colleges ofthe Georgia Department ofTechmcal and Adult Education will contmue to report summer revenues and expenses m the year m which the predommate activity takes place

- 14 -

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

NOTE I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING For financial reportmg purposes, the Techmcal College 1s considered a special-purpose government engaged only m busmess-type act1v1t1es Accordmgly, the Techmcal College's financial statements have been presented usmg the economic resources measurement focus and the accrual basis of accountmg, except as noted m the precedmg paragraph Under the accrual basis, revenues are recogmzed when earned, and expenses are recorded when an obligation has been mcurred All s1gmficant mtra-college transact10ns have been ehmmated
The Techmcal College has the opt10n to apply all Fmanc1al Accountmg Standards Board (FASB) pronouncements issued after November 30, 1989, unless FASB conflicts With GASB The Techmcal College has elected to not apply FASB pronouncements issued after the applicable date
RESTATEMENT OF NET ASSETS - BEGINNING OF YEAR As a result of the adoption ofGASB Statement No 34, the Techmcal College was also required to make certam changes m accountmg pnnc1ples, specifically (1) adoption of depreciation on capital assets, and (2) recordmg of compensated absences GASB Statement No 34 reqmres certam summer semester revenues be recogmzed between fiscal years rather than the fiscal year m wluch the semester was predommantly conducted The Techmcal College has chosen to contmuc to record summer revenue m the year m which the semester was predormnantly conducted Effective July I, 200 I, the Techmcal College's cap1tahzat1on pohcy for equipment was mcreased from $1,000 00 to $5,000 00 Net assets at July 1, 2001 were mcreased by $4,629,663 87 for the cumulative effect of these changes
CASH AND CASH EQUIVALENTS Cash and Cash Equivalents mclude currency on hand and demand deposits with banks and other authonzed financial mst1tut1ons
ACCOUNTS RECEIVABLE Accounts receivable consist of allotments due from the Georgia Department ofTechmcal and Adult Education - Adm1mstrat1ve Central Office, reimbursements due from Federal, State, local, and pnvate grants and contracts, and other receivables disclosed from mformauon available
INVENTORIES Inventones of goods for resale are recorded as assets at cost at the lime ofpurchase The Techmcal College uses the first-m, first-out method m costmg-out mventones based on sales
CAPITAL ASSETS Capital assets are recorded at cost at date of acqws1t1on, or f3.1r market value at the date of capital contnbullon The Tcchmcal College cap1tal1zes all land and land improvements For eqmpment, the Techmcal College's cap1tal1zallon pohcy mcludes all items With a umt cost of$5,000 00 or more, and an estimated useful hfe of greater than one year Bu1ldmgs and Buildmg lmprovements, Improvements Other Than Bmldmgs and Library Collecllons that exceed $100,000 00 or
- 15 -

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTE I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CAPITAL ASSETS s1gmficantly increase the value or extend the useful hfe of the asset are capitalized For infrastructure, the Techrucal College's cap1tahzat1on threshold 1s $1,000,000 00 Routme repairs and maintenance are charged to operating expense in the year in which the expense was incurred Deprec1at10n 1s computed using the stra1ght-hne method over the estrmated useful hves ofthe assets, generally 10 to 40 years for buildings, 15 to 25 years for infrastructure, 15 years for improvements other than bmldings, 10 years for library books, and 3 to 10 years for equipment
To obtain full disclosure of capital assets acquued by the Techrucal Colleges of the Georgia Department ofTechmcal and Adult Educalion, 111s necessary to look at the acliVJlies ofthe Georgia State Financmg and Investment Comrruss1on (GSFIC) - an orgaruzal!on that 1s external to both the Techrucal College and the Georgia Department of Techmcal and Adult Educalion The GSFIC issues bonds for and on behalf of the State of Georgia, pursuant to powers granted to 1t in the Conslitulion of the State of Georgia and the Act creating the GSFIC The bonds are issued for the pmpose of acqumng capital assets and this debt conslitutes direct and general obhgallons ofthe State of Georgia, to the payment ofwluch the full faith, credit and taxing power of the State are pledged
GSFIC records construclion in progress on its books throughout the construction penod and at complet10n transfers the enlire proJect cost to West Central Techrucal College to be recorded as an asset on the Techmcal College's books For the year ended June 30, 2002, GSFIC transferred capital addlllons valued at $23,731,240 00 to West Central Techrucal College
DEFERRED REVENUES Deferred revenues include amounts r(;ce1ved for tmtlon and fees and other aclivllles pnor to the end of the fiscal year but related to the subsequent accountmg penod Deferred revenues also include amounts received from grant and contract sponsors that have not yet been earned
COMPENSATED ABSENCES Employee vacalion pay 1s accrued for financial statement purposes when vested The hab1hty and expense incurred are recorded at year-end as accrued vacat10n payable in the Statement of Net Assets, and as a component of compensation and benefit expense m the Statements of Revenues, Expenses, and Changes m Net Assets West Central Technical College had an accrued hab1hty for compensated absences m the amount of $545,810 51 as of July 1, 2001 For fiscal year 2002, $556,718 98 was earned m compensated absences and employees were pmd S464,049 41, for a net mcrease of$92,669 57. The endmg balance as ofJune 30, 2002 m accrued hab1hty for compensated absences 1s $638,480 08
NON-CURRENT LIABILITIES Non-current hab1hlies mclude hab1hlies that will not be paid w1thm the next fiscal year

- 16 -

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NET ASSETS The Techmcal College's net assets are class1 fied as follows
lnl'csted m capital assets, net ofrelated debt This amount represents the Techmcal College's total mvestment m capital assets, net of outstandmg debt obhgat1ons related to those capital assets To the ei..tent debt has been mcurred but not yet expended for capital assets. such amounts are not mcluded as a component ofmvested m capital assets, net ofrelated debt (The term "debt obhgat10ns" as used m this definit10n does not mclude debt of the GSFIC as discussed above)
Restricted net assets Restncted net assets are for unexpended grant funds of $52,849 74 due to grantor agencies
Unrestricted net assets Unrestricted net assets represent available resources derived from student tUIIIon and fees, state appropriauons, and sales and services of educational departments These resources will be used for transactions relatmg to the educational and general operations of the Technical College, and may be used at the d1screuon of the govemmg board to meet subsequent fiscal year expenses for those purposes
When an expense 1s mcurred that can be paid usmg either restricted or unrestricted resources, the Technical College's pohcy 1s to first apply the expense towards unrestncted resources, and then towards restricted resources
INCOME TAXES West Central Technical College, as a poht1cal subd1v1s1on of the State of Georgia, 1s excluded from Federal mcome taxes under Secuon 115( 1) ol the Internal Revenue Code, as amended
CLASSIFICATION OF REVENUES The Technical College has classified its revenues as either operatmg or nonoperatmg revenues m the Statement of Revenues. Expenses, and Changes m Net Assets accordmg to the followmg criteria
Operatmg re1enucs Operatmg revenues mclude acuv1t1es that have the characteristics ofexchange transact10ns, such as (1) student tU1t1on and fees, net of scholarship allowances, (2) certam Federal. state and local grants and contracts. and (3) sales and services
Nonoperatmg revenues Nonoperatmg revenues mclude act1v1Ues that have the characteristtcs of non-ei..change transactions, such as gifts and contributions, and other revenue sources that are defined as nonoperatmg revenues by GASB No 9. Reporting Cash Flows of Proprietary and NoneTpendab/e Tnist Funds and Governmental Entllles That Use Proprietan Fund Accounting, and GASB No 34, such as state appropriations and mvestrnent mcome

- I7 -

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 200:?

EXHIBIT "D"

NOTE I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CLASSIFICATION OF REVENUES Scholarship Allowances Student twuon and fee revenues, and certam other revenues from students, are reported at gross with a contra revenue account of scholarship allowances in the Statement of Revenues, Expenses, and Changes in Net Assets Certain governmental grants, such as Pell grants, and other Federal, state or nongovernmental programs, are recorded as either operating or nonoperating revenues in the Techrucal College's financial statements To the extent that revenues from such programs are used to satisfy tu1t1on and fees and other student charges, the Technical College has recorded contra revenue for scholarship allowances
NOTE 2 CASH AND CASH EQUIVALENTS AND OTHER DEPOSITS
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds belonging to West Central Techrucal College (and thus the State ofGeorgia) cannot be placed in a depository pa)'lng interest longer than ten days without the depos1toryproV1ding a surety bond to the State In heu of a surety bond, the depository may pledge as collateral any one or more of the followmg secuntles as enumerated in the Official Code of Georgia Annotated Section 50-17-5'}-
l Bonds, bill, certificates of mdebtedness, notes, or other drrect obhgat1ons ofthe Umted States or ofthe State of Georgia
2 Bonds, bills, certificates of mdebtedness, notes, or other obhgauons of the counties or mumc1pal1t1es of the State of Georgia.
3 Bonds ofany pubhc authonty created by the laws ofthe State ofGeorgia, providing that the statute that created the authonty authonzed the use of the bonds for tlus purpose
4 Industnal revenue bonds and bonds of development authont1es created by the laws of the State of Georgia
5 Bonds, bills, certificates of indebtedness, notes, or other obligations of a subs1d1ary corporation of the Umted States government, which are fully guaranteed by the Umted States government both as to pnnc1pal and mterest, 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 Nauonal Mortgage Association
6 Guarantee or insurance ofaccounts provided by the Federal Deposit Insurance Corporation
As authonzed in the Official Code of Georgia Annotated Secuon 50-17-53, the State Depository Board has adopted pohc1es, which allow agencies of the State of Georgia (and thus West Central Techmcal College), the opt10n of exempting demand deposits from the collateral reqmrements
- 18 -

...
WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

NOTE 2 CASH AND CASH EQUIVALENTS AND OTHER DEPOSJTS

CATEGORIZATION OF DEPOSITS The Techrucal College's cash deposits are categonzed by nsk as follows

Category I - Amounts covered by depository msurance or collaterahzed with secunties (at fa1r value) held by the Techrucal College or by Its agent m the Techmcal College's name

Category 2 - Amounts collaterahzed with secunt1es (at fa1r value) held by the pledgmg financial mst1tut1on's trust department or agent m the Techrucal College's name

Category 3 - Amounts collateral1zed With secunt1es (at fair value) held by the pledgmg financial mstltutlon, or by Its trust department or agent but not m the Techmcal College's name, and amounts uncollateral1zed

At June 30, 2002, the Techrucal College's cash deposits were as follows

Cash Depos,ts

Carrymg
Amount

Bank Balances

Risk Catc&oacs

s 155 095 32 s 120411501 s 116 ~23 90 s_ _=-o..,o,,,_o s I 087 7~J..J.

NOTE 3 INVENTORIES

Inventones at June 30, 2002, consisted of the followmg

Bookstore

S 414,531.56

NOTE 4 CAPITAL ASSETS

The balance of capital assets at July !, 2001, was adJusted for accountmg changes reqmred m 1mplementmg GASB Statements 34 and 35 as c!Jsclosed m Note 1 Followmg are the changes m capital assets for the year ended June 30, 2002

- 19 -

--------

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTE 4 CAPITAL ASSETS

AdJustcd
Balance
Julv 1 2001

AddJJJOOS

Rcductmns

Balance
June 30 2002

Cap11al Assets, Not Bemg Depreciated

Land and Land Improvements

$ l ,761 380 00

s I 761,380 oo

Capital Assets, Bcmg Depreciated Building and Bu1ldmg Improvements Improvements Other Than Buildings Equipment Library Collcct1ons

S 10,161,23900 $ 23,731,24000

2,018,18000

2,589,984 70

495,988 66 S

652,039 86

S 33,8Q2,479 00 2,018,180 00
311,082 82 2,774,890 54
652 039 86

S )5.421443~6 S 24,227,22866 S 31108282 S 39"758940

Less Accumulated Dcprec1at1on

Buildings and Bulidmg Improvements S 1,777,795 32 $

Improvements Other Than Bu1ldmgs

I, I35,828 53

Equipment

2,082, I36 75

Library Collcc11ons

293,417 93

s H89 17B 53 s

320,333 54 192,103 67
I65,130 94 s
65,203 99
742 772 )4 s

S 2,098,128 86 1,327 932 20
296,585 23 1,950 682 46 358.62) 92
296,585 23 S 5 7'5,365 44

Total Capital Assets, Bemg Depreciated,

Net

$ 10,132,i65 Ol $ 2l 484,456 52 s

Capital Assets, Net

S 11 89} 645 g; S 7; 484456 52 S

)4 497 59 S 33,602,223 96
l4 497 ~2 s 35 363 603,..26

NOTE 5 DEFERRED REVENUE

Deferred revenue at June 30, 2002, consists of the following

Preprud Twt10n and Fees Federal Grants and Contracts
Totals

S 91,69649 10.424 32
s 102.120181

NOTE 6 LONG-TERM LIABILITIES

Long-term liab1hty act1v1ty for the year ended June 30, 2002 was as follows

Other L1ab1ln1cs Compensated Absences

Balance
Ju\y 1 2001

Add1t10ns

Reductions

Bal.mcc
June 30 2002

Current Portion

$ ~~~ BIQ SI $ 5~~ 71~..9__8 s 4fd.M241 s ~lb:l.Wlli s J~~ 074 92

- 20-

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMEl\'TS
JUNE 30, 2002

EXHIBIT "D"

NOTE 7 LEASE OBLIGATIONS

OPERATING LEASES West Central Techmcal College has entered mto certam agreements to lease equipment which are classified as operatmg leases (leases on assets not recorded on the balance sheet) These leases generally contam prov1s1ons that, at the exprrallon date of the angina! term of the lease, the Techmcal College has the option of renewmg the lease on a year-to-year basis Amounts are mcluded only for multi-year leases

Expenses for rental of equipment under operatmg leases for the year ended June 30, 2002, totaled $2,151 04

SUMMARY OF LEASE OBLIGATIONS Future commitments for noncancellable operatmg leases havmg remammg terms m excess of one year as of June 30, 2002, were as follows

Operatmg Leases

Year Endmg June 30 2003 2004 2005 2006 2007

S 7,356 00 7,356 00 6,744 00 6,540 00 6 540 00

Total M1mmurn Lease Payments

S 34,536.00

NOTE 8 RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA

Plan Description West Central Techmcal College part1c1pates m the Teachers Ret1rement System of Georgia (TRS), a cost-shanng mult1ple-employer defined benefit pension plan established by the General Assembly of Georgia for the purpose of prov1dmg retirement allowances and other benefits for teachers of the State of Georgia TRS provides servJce retirement, d1sab1htyretlrement, and survivor's benefits for its members m accordance with State statute The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtamed from the Georgia Department of Audits and Accounts

- 21 -

- --- ---- -- -- --

------ -
WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTE 8 RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA

Funding Policy Employees of West Central Techmcal College who are covered by TRS are reqmred by State statute to contnbute 5% of their gross earnmgs to TRS. West Central Techmcal College makes monthly employer contnbul!ons to TRS at rates adopted by the TRS Board of Trustees m accordance with State statute and as advised by their mdependent actuary For fiscal year 2002, the employer contnbulion rate was 9.24% for covered employees Employer contnbuuons for the current fiscal year and the precedmg two fiscal years arc as follows

Fiscal Year

Percentage Contnbuted

Reqmred Contnbutlon

2002 2001 2000

100% 100% 100%

$ 565,742 19 $ 629,577.89 $ 535,092 25

EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

Plan Description West Central Techmcal College part1c1pates m the Employees' Retm:ment System ofGeorgia (ERS), a smgle-employer defined benefit pension plan estabhshed by the General Assembly of Georgia for the purpose of prov1dmg reurement allowances for employees of the State of Georgia

The benefit structure ofERS 1s defined by State statute and was s1gmficantly modified on July I.
1982 Unless elected otherwise, an employee who currently mamtams membership with ERS based upon State employment that started pnor to July 1, 1982, 1s an "old plan" member subject to the plan prov1s1ons m effect pnorto July 1, 1982 All other members are "new plan" members subJect to the modified plan prov1s1ons

Under both the old plan and new plan, members become vested after IO years of creditable service A member may reure and receive normal retlrement benefits after completion of IO years of creditable service and attamment of age 65 If IO years of service 1s completed and age 60 1s reached, the member may retire with a reduced benefit Add11ionally, there are certam prov1s1ons allowmg for retirement after 25 years of service regardless of age

Retlrement benefits paid to members are based upon a formula which considers the monthly average of the member's highest twenty-four conseculive calendar months of saJary, the number of years of creditable service, and the member's age at retlrement Postretlrernent cost-of-hvmg adjustments are also made to member's benefits The normal relirement pension 1s payable monthly for hfe,

- 22 -

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTE 8 RETIREMENT PLANS
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA
Plan Description however, options are available for d1stnbuuon ofthe member's monthly pension at reduced rates to a designated beneficiary upon the member's death Death and d1sab1hty benefits arc also available through ERS.
In adchuon, the ERS Board of Trustees created the Supplemental Retirement Benefit Plan (SRBP) effective January I, 1998 The SRBP was established as a quahfied governmental excess benefit plan m accordance with Section 415 of the Internal Revenue Code (IRC) as a portion ofERS The purpose ofSRBP 1s to provide reUrement benefits to employees covered by ERS whose benefits are otherwise limited by IRC 415
The ERS issues a financial report each fiscal year which may be obtained through ERS
Funding Policy As established by State statute, all full-ttme employees of the State of Georgia and its poht1cal subd1v1s1ons, who are not members ofother state retirement systems, are eligible to pamc1pate m the ERS Both employer and employee contnbuuons are estabhshed by State statute The Techmcal College's payroll for the year ended June 30, 2002, for employees covered by ERS was $1,213,015 46. The Techmcal College's total payroll for all employees was $8,704,513 60
Under the old plan, member contnbutlons consist of 6 25% of annual compensation Of these member contnbutlons, the employee pays the first 1 5% and the Techmcal College pays the remainder on behalf of the employee Under the new plan, member contnbuuons consist solely of I 5% of annual compensation paid by employee The Techmcal College also 1s required to contnbute at a specified percentage of active member payroll determmed annually by actuanal valuation For the year ended June 30, 2002. the ERS employer contnbuuon rate for the Techmcal College amounted to IO 51% of covered payroll and mcluded the amounts contnbuted on behalf of the employee under the old plan referred to above. Employer contnbuuons are also made on amounts p3.!d for accumulated leave to retmng employees
Total contnbutlons to the plan made durmg fiscal year 2002 amounted to $142.694 54, ofwh1ch $127,531.77 was made by the Techmcal College and Sl5,162.77 was made by employees These contnbutlons met the reqmrements of the plan
Actuarial and Trend Information Actuanal and h1stoncal trend mformat10n 1s presented m the ERS June 30, 2002, financial report which may be obt3.Jned through ERS

- 23 -

WEST CENTRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT "D"

NOTES RETIREME~1PLANS
GEORGIA DEFINED CONTRIBUTION PLAN
Plan Description West Central Techmcal College part:Ic1pates m the Georgia Defined Contnbullon Plan (GDCP) winch 1s a smgle-employer defined contnbullon plan estabhshed by the General Assembly of Georgia for the purpose ofprov1dmg retirement coverage for State employees who are temporary, seasonal, and part-time and are not members of a pubhc re11rement or pension system GDCP 1s adm1rustered by the Board of Trustees of the Employees' Retirement System of Georgia
Benefits A member may retire and elect to receive penodlc payments after attamment ofage 65 The payment will be based upon mortahty tables and mterest assumptions to be adopted by the Board ofTrustees If a member has less than$ 3,500 00 credited to Ins/her account, the Board ofTrustees has the option of requmng a lump sum chstnbut1on to the member m heu ofmakmg penod1c payments Upon the death of a member, a lump sum d1stnbut1on equalmg the amount credited to his/her account will be paid to the member's designated beneficiary Benefit provmons are estabhshed by State statute
The Employees' Retirement System of Georgia issues a financial report each fiscal year which may be obtained through ERS
Contributions and Vestlng Member contributions are seven and one-halfpercent (7 5%) ofgross salary There are no employer contnbutlons Contnbutlon rates are estabhshed by State statute Earnmgs are credited to each member's account m a manner estabhshed by the Board of Trustees Upon termmat1on of employment, the amount of the member's account 1s refundable upon request by the member The Techmcal College's payroll for the year ended June 30, 2002, for employees covered by GDCP was $916,754 47. The Techmcal College's total payroll for all employees was $8,704,513 60
Total contnbut1ons made by employees dunng fiscal year 2002 amounted to $68,660 62 which represents 7.5% of covered payroll These contnbut1ons met the requirements of the plan
NOTE 9 RISK MANAGEMENT
Public Entity Risk Pool The Department of Community Health admm1sters for the State of Georgia a program of health benefits for the employees of units of government of the State of Georgia, umts of county governments, and local education agencies located With the State of Georgia This plan 1s funded by participants covered m the plan, by employers' contnbut1ons paid by the vanous umts ofgovernment parllc1patmg m the plan, and appropnallons made by the General Assembly of Georgia The

- 24 -

WEST CEl'a'TRAL TECHNICAL COLLEGE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT"D"

NOTE 9 RISK MANAGEMEr,.,'T
Public Entity Risk Pool Department ofCommurutyHealth has contracted with Blue Cross Blue Shield of Georgia to process medical claID1s and Express Scnpts, Incorporated to process prescnpl!on drug cllums m accordance wllh the State Employees' Health Benefit Plan as estabhshed by the Department of Community Health
Other Risk Management The Department of Admnustral!ve Services (DOAS) has the respons1b1hty for the State of Georgia of makmg and carrymg out dec1S1ons that will mm1m1ze the adverse effects of accidental losses that mvolve State government assets. The State beheves 1t 1s more economical to manage its nsks mtemally and set aside assets for chum settlement Accordmgly, DOAS processes claims for nsk of loss to wluch the State 1s exposed, mcludmg general hab1hty, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' mdemmfication L1m11ed aniounts of commerc1al insurance are purchased apphcable to property, employee and automobile hab1hty, fidelity and certam othernsks The Techrucal College, as an organ1za1Ional unit of the Georgia Department of Techmcal and Adult Educal!on, 1s part of the State of Georgia reportmg entity, and as such, 1s covered by the State of Georgia nsk management program adm1mstered by DOAS. Premrnms for the nsk management program are charged to the vanous state organizal!ons by DOAS to provide claims serv1cmg and claims payment
NOTE IO CONTINGENCIES
Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. Tlus could result m refunds to the grantor agency for any expenses wluch are disallowed under grant terms The aniount of expenses wluch may be disallowed by the grantor cannot be determmed at this time although West Central Techrucal College expects such aniounts, 1fany, to be 1mmatenal to its overall financial pos11Ion
LJtJgal!on, claims and assessments filed agamst West Central Techrucal College (an orgamzat10nal urut of the Department of Techrucal and Adult Educal!on), 1f any, are generally considered to be acl!ons agamst the State of Georgia Accordmgly, s1gruficant hllgal!on, claims and assessments pendmg agamst the State of Georgia are disclosed m the State of Georgia Comprehensive Annual Fmanc1al Report for the fiscal year ended June 30, 2002
NOTE 11 NATURAL CLASSIFICATIONS WITH FUNCTIONAL CLASSIFICATIONS
The Techrucal College's operal!ng expenses shown at the natural class1fica1Ion on the "Statement of Revenues, Expenses and Changes m Net Assets" are all classified as Instrucl!on at the funcuonal class1fica11on

- 25 -

SUPPLEMENTARY INFORMATION
- 27 -

WEST CENTRAL TECHNICAL COLLEGE SCHEDULE OF FUNDS AVAILABLE AND EXPENDITURES
COMPARED TO BUDGET (NON-GAAP BASIS}
BUDGET FUND "A" DEPARTMENT Of TECHNICAL AND ADULT EDUCATION
YEAR ENDED JUNE 30. 2002

SCHEDULE "1"

FUNDS AVAILABLE REVENUES
State Appropriauon Federal Revenues 01her Revenues Retained
CARRY-OVER FROM PRIOR YEAR Transfer from Reserved Fund Balance

BUDGET

ACTUAL (1)

VARIANCEFAVORABLE (UNFAVORABLE)

$ 9,074.799 00 $ 9,062,635 83 $

1,836.832 70

1,484.375 24

3,590,597 12

3,559 074 67

$ 14.502,228 82 $ 14,106,085 74 $

-12.163 17 -352.457 46
-31 522 45
-396.143 08

000

56 951 59

56 951 59

$ 14,5021228 82 $ 14,163.037 33 $ _ ____c-3c;:3,c.9..c1.c.9.c._1_.c,49"-

EXPENDITURES
Personal Services - lnstrtut1ons Operating Expenses - lnst1tut1ons Adult Literacy Grants Job Training Partnership Act Caprtal Outlay

$ 9.867,388 50 $ 9,853.408 28 $

3,511,058 38

3.179,084 24

964.156 94

643,770 26

53,652 00

52,902 40

105,973 00

105,973 00

13,980 22 331.974 14 120,386 68
74960 0 00

$ 1415021228 82 S 14,035.13818 $ _ _ _4:,::6.:..7c=,090=.::.64.:..

Excess of Funds Available over Expenditures

$

s_ _ 121899 15

....:1~2,!:1,.;,s.::.99~1s~

(1) Actual amounts were prepared on a prescnbed basis of accounting that demonstrates compliance with budgetary staMes and regulauons of the State of Georgia, wtuch 1s a comprehensive basis of accounting other than generally accepted accounung pnnaples

- 29 -

WEST CEN:rRAL TECHNICAL COLLEGE RECONCILIATION,OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30, 2002

SCHEDULE "2"

Totals per Annual Supplement
Acauals June 30, 2001 June 30, 2002
Compensated Absences June 30, 2001 June 30, 2002
Agency Funds

SALARIES

$

8,606,554 38 $

TRAVEL 153,025 78

-5,724 25 13,259 50

-532,355 99 622,779 96

-879 26

$

8 704 513 so s_ _ _1_5_2_1..,4_s..,s_2_

- 30 -

SECTION II AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

WEST CENTRAL TECHNICAL COLLEGE AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR Fll\'DINGS AND OUESTJONED COSTS YEAR ENDED JUNE 30, 2002

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-826-01-01

Parually Resolved - See Corrective Acuon/Responses

CORRECTIVE ACTION/RESPONSES

CASH AND CASH EQUNALENTS Inadequate Accountmg Procedures Fmdmg Control Number FS-826-01-01

Reconcilmg items m the HOPE Scholarship Account as of June 30, 2001 remam uncorrected. All of these items will be researched and recorded on the general ledger of West Central Technical College before the end of the current fiscal year June 30, 2003

SECTION III CURRENT YEAR FINDINGS AND QUESTIONED COSTS

WEST CENTRAL TECHNICAL COLLEGE SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2002
FINANCIAL STATEME1'.'T FINDINGS AND QUESTIONED COSTS
EXPENDITURES/LIABILITIES/DISBURSEMENTS Improper Multl-Year Lease Agreements Fmdmg Control Number FS-826-02-01
The College has entered mto multi-year lease agreements for rental of postage meter machmes These agreements do not contam proper contract termmatlon clause and renewal prov1smns as outlmed m the Official Code of Georgia, Annotated Section 50-5-64 which requires lease contracts to terminate "absolutely and without further obligation" at the close of the fiscal year that 11 was executed and at the end of each succeedmg year for wluch the contract 1s renewed The Code states that a "contract can only be renewed by a positive action taken by the user agency" This condlllon occurred because management failed to adequately momtor prov1s1ons mcluded m lease contractual agreements.
The College should review all multi-year lease agreements and take necessary action to ensure that all leases have the standard form prov1s1ons reqwred by the OCGA Section 50-5-64