TECHNICAL COLLEGE SYSTEM OF GEORGIA ATLANTA, GEORGIA BUDGETARY COMPLIANCE REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2013 Georgia Department of Audits and Accounts Greg S. Griffin State Auditor TECHNICAL COLLEGE SYSTEM OF GEORGIA - TABLE OF CONTENTS - SECTION I COMPLIANCE Page INDEPENDENT ACCOUNTANT'S REPORT EXHIBITS A STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET 2 BY PROGRAM AND FUNDING SOURCE BUDGET FUND B STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND 4 FUNDING SOURCE BUDGET FUND SECTION II CURRENT YEAR FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS SECTION I COMPLIANCE Greg S. Griffin STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 November 12, 2013 Honorable Nathan Deal, Governor Members of the General Assembly of Georgia Members of the State Board of the Technical College System of Georgia and Honorable Ronald Jackson, Commissioner Technical College System of Georgia INDEPENDENT ACCOUNTANT'S REPORT Ladies and Gentlemen: We have examined the Technical College System of Georgia's compliance with the 2013 Appropriations Act, as amended, (Final Budget) and Article VII, Section IV Paragraph VIII of the Constitution of the State of Georgia for fiscal year ended June 30, 2013. Management is responsible for the Technical College System of Georgia's compliance with the following requirements: An appropriated budget unit cannot overspend their authorized budgeted amounts at the legal level of budgetary control (funding source within program). This means that the amounts that are reflected in the "actual" and "variance" columns of the appropriated budget unit's budgetary comparison schedule at the legal level of budgetary control (funding source within program) are all positive variances or result in an excess of funds available over expenditures. The Constitution of the State of Georgia (Article VII, Section IV Paragraph VIII) provides, in part, "...the credit of the State shall not be pledged or loaned to any individual, company, corporation or association." As applied here, this provision of the Constitution of the State of Georgia requires that an appropriated budget unit have available, at the time of entering into a provider agreement, sufficient appropriated funds, not otherwise obligated, to satisfy all potential liabilities to be incurred by the State pursuant to such agreement. Our responsibility is to express an opinion based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, includes examining, on a test basis, evidence supporting the Technical College System of Georgia's compliance with these requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the Technical College System of Georgia's compliance with these requirements; however, our report may be useful to legal counsel or others in making such determinations. In our opinion, the Technical College System of Georgia complied, in all material respects, with the aforementioned requirements for the fiscal year ended June 30, 2013. This report is intended solely for the information and use of the Board and management of the Technical College System of Georgia and the State of Georgia, including the Governor and the Georgia General Assembly and is not intended to be and should not be used by anyone other than these specified parties. However, this report is a matter of public record and its distribution is not limited. Respectfully submitted, GSG:as Greg S. Griffin State Auditor EXHIBITS Technical College System of Georgia Statement of Funds Available and Expenditures Compared to Budget By Program and Funding Source Budget Fund For the Fiscal Year Ended June 30, 2013 Adult Literacy State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified Other Funds Total Adult Literacy Departmental Administration State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified American Recovery & Reinvestment Act of 2009 Federal Recovery Funds Not Specifically Identified Other Funds Total Departmental Administration Quick Start and Customized Services State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified Other Funds Total Quick Start and Customized Services Technical Education State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified American Recovery and Reinvestment Act of 2009 Federal Recovery Funds Not Specifically Identified Other Funds Total Technical Education Budget Unit Totals Original Appropriation Amended Appropriation Final Budget Funds Current Year Revenues $ 13,473,095.00 20,447,889.00 5,480,000.00 39,400,984.00 $ 13,069,219.00 20,447,889.00 5,480,000.00 38,997,108.00 $ 13,069,219.00 19,390,824.00 6,609,562.00 39,069,605.00 $ 13,069,219.00 19,191,446.05 5,716,277.77 37,976,942.82 7,944,927.00 62,111.00 595,084.00 210,000.00 8,812,122.00 7,723,367.00 62,111.00 595,084.00 210,000.00 8,590,562.00 7,723,367.00 - 698,877.00 163,482.00 8,585,726.00 7,723,367.00 - 698,876.92 118,590.64 8,540,834.56 12,578,020.00 1,000,000.00 8,930,000.00 22,508,020.00 12,209,074.00 1,000,000.00 8,930,000.00 22,139,074.00 12,209,074.00 130,884.00 9,997,892.00 22,337,850.00 12,209,074.00 113,712.68 7,036,731.23 19,359,517.91 296,574,308.00 44,999,000.00 - 255,450,000.00 597,023,308.00 284,614,727.00 44,999,000.00 - 255,450,000.00 585,063,727.00 284,614,727.00 54,910,964.00 2,327,078.00 318,420,758.00 660,273,527.00 284,614,727.00 40,537,712.92 1,612,035.42 274,786,770.29 601,551,245.63 $ 667,744,434.00 $ 654,790,471.00 $ 730,266,708.00 $ 667,428,540.92 2 Exhibit A Available Compared to Budget Prior Year Reserve Program Transfers Carry-Over or Adjustments Total Funds Available Variance Positive (Negative) Expenditures Compared to Budget Actual Variance Positive (Negative) Excess (Deficiency) of Funds Available Over/(Under) Expenditures $ -$ - $ 13,069,219.00 $ - $ 13,028,510.08 $ 40,708.92 $ 86,000.02 57,935.75 3,413.62 243,813.02 19,280,859.69 6,018,026.54 (109,964.31) (591,535.46) 19,063,415.56 5,560,682.93 327,408.44 1,048,879.07 143,935.77 247,226.64 38,368,105.23 (701,499.77) 37,652,608.57 1,416,996.43 40,708.92 217,444.13 457,343.61 715,496.66 - - 7,723,367.00 - 7,723,270.37 96.63 96.63 - - - - - - - - - 698,876.92 (0.08) 698,876.92 0.08 - - - 118,590.64 (44,891.36) 117,484.73 45,997.27 1,105.91 - - 8,540,834.56 (44,891.44) 8,539,632.02 46,093.98 1,202.54 - 0.38 3,177,795.87 3,177,796.25 - 410,827.58 410,827.58 12,209,074.00 113,713.06 10,625,354.68 22,948,141.74 - (17,170.94) 627,462.68 610,291.74 12,207,004.62 113,712.68 6,930,112.52 19,250,829.82 2,069.38 17,171.32 3,067,779.48 3,087,020.18 2,069.38 0.38 3,695,242.16 3,697,311.92 107,507.34 70.00 48,017,308.26 48,124,885.60 7,829.74 731.00 (666,614.96) (658,054.22) 284,614,727.00 40,653,050.00 1,612,836.42 322,137,463.59 649,018,077.01 (14,257,914.00) (714,241.58) 3,716,705.59 (11,255,449.99) 284,610,922.56 39,685,825.46 1,612,766.42 270,271,907.87 596,181,422.31 3,804.44 15,225,138.54 714,311.58 48,148,850.13 64,092,104.69 3,804.44 967,224.54 70.00 51,865,555.72 52,836,654.70 $ 51,446,617.62 $ - $ 718,875,158.54 $ (11,391,549.46) $ 661,624,492.72 $ 68,642,215.28 $ 57,250,665.82 3 Technical College System of Georgia Statement of Changes to Fund Balance By Program and Funding Source Budget Fund For the Fiscal Year Ended June 30, 2013 Adult Literacy State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified Other Funds Total Adult Literacy Departmental Administration State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified American Recovery & Reinvestment Act of 2009 Federal Recovery Funds Not Specifically Identified Other Funds Total Departmental Administration Quick Start and Customized Services State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified Other Funds Total Quick Start and Customized Services Technical Education State Appropriation State General Funds Federal Funds Federal Funds Not Specifically Identified American Recovery and Reinvestment Act of 2009 Federal Recovery Funds Not Specifically Identified Other Funds Total Technical Education Total Operating Activity Prior Year Reserves Not Available for Expenditure Inventories Refunds to Grantors Other Reserves Beginning Fund Balance/(Deficit) July 1 Fund Balance Carried Over from Prior Period as Funds Available Return of Fiscal Year 2012 Surplus Prior Year Adjustments $ 31,374.32 $ -$ (31,374.32) $ 12,337.94 86,000.02 73,596.78 (86,000.02) (57,935.75) (15,661.03) (42,326.46) (11,892.58) 190,971.12 (143,935.77) (47,035.35) (41,881.10) $ 345.54 $ - 33,520.48 33,866.02 -$ - (345.54) $ - (33,520.48) (33,866.02) 2,287.23 - 491.89 2,779.12 7,929.68 0.38 3,177,872.13 3,185,802.19 - (0.38) (3,177,795.87) (3,177,796.25) (7,929.68) (76.26) (8,005.94) 5,491.64 625.79 72,208.23 78,325.66 127,473.22 107,507.34 70.00 48,109,980.79 48,345,031.35 51,755,670.68 (107,507.34) (70.00) (48,017,308.26) (48,124,885.60) (51,446,617.62) (127,473.22) - (92,672.53) (220,145.75) (309,053.06) 27,651.11 (60,176.47) (2,195,146.58) (2,227,671.94) (2,188,448.26) 4,306,022.99 - - - 8,222.84 - - (1,081.04) 768,693.16 - - - Budget Unit Totals $ 56,838,609.67 $ (51,446,617.62) $ (309,053.06) $ (2,189,529.30) 4 Exhibit B Other Adjustments Early Return of Fiscal Year 2013 Surplus Excess (Deficiency) of Funds Available Over/(Under) Expenditures Ending Fund Balance/(Deficit) June 30 Analysis of Ending Fund Balance Reserved Surplus/(Deficit) Total $ -$ (57,312.76) 10,080.19 (47,232.57) -$ - - 40,708.92 $ 217,444.13 457,343.61 715,496.66 53,046.86 $ 117,804.91 455,531.22 626,382.99 -$ 117,804.91 449,084.19 566,889.10 53,046.86 $ 6,447.03 59,493.89 53,046.86 117,804.91 455,531.22 626,382.99 $ -$ -$ 96.63 $ 2,383.86 $ -$ 2,383.86 $ 2,383.86 - - - - - - - - - - - - - - - - 1,105.91 1,597.80 - 1,597.80 1,597.80 - - 1,202.54 3,981.66 - 3,981.66 3,981.66 - (0.38) (10,974.50) (10,974.88) - 2,069.38 7,561.02 - - 0.38 625.79 625.79 - 3,695,242.16 3,756,475.89 3,755,147.02 - 3,697,311.92 3,764,662.70 3,755,772.81 7,561.02 1,328.87 8,889.89 7,561.02 625.79 3,756,475.89 3,764,662.70 (47,728.21) (70.00) 208,435.43 160,637.22 102,429.77 - 3,804.44 31,455.55 - - 967,224.54 859,319.86 859,319.86 - 70.00 - - - 51,865,555.72 49,878,844.57 49,800,751.59 - 52,836,654.70 50,769,619.98 50,660,071.45 - 57,250,665.82 55,164,647.33 54,982,733.36 31,455.55 - 78,092.98 109,548.53 181,913.97 31,455.55 859,319.86 49,878,844.57 50,769,619.98 55,164,647.33 (631,858.22) 4,352.04 421,078.50 $ (103,997.91) $ - - 3,674,164.77 3,674,164.77 - 3,674,164.77 - - 11,493.84 11,493.84 - 11,493.84 - - 1,189,771.66 1,189,771.66 - 1,189,771.66 - $ 57,250,665.82 $ 60,040,077.60 $ 59,858,163.63 $ 181,913.97 $ 60,040,077.60 Summary of Ending Fund Balance Reserved Inventories Federal Financial Assistance Refunds to Grantors Other Reserves Unreserved, Undesignated Surplus Total Ending Fund Balance - June 30 $ 3,674,164.77 $ 977,750.56 11,493.84 55,194,754.46 - $ 59,858,163.63 $ - 181,913.97 181,913.97 $ 3,674,164.77 977,750.56 11,493.84 55,194,754.46 181,913.97 $ 60,040,077.60 5 SECTION II CURRENT YEAR FINDINGS AND QUESTIONED COSTS TECHNICAL COLLEGE SYSTEM OF GEORGIA SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2013 No matters were reported.