Annual financial report, fiscal year 2017

2017 Fiscal
Year
Annual Financial Report

UNIVERSITY SYSTEM OF GEORGIA

UNIVERSITY SYSTEM OF GEORGIA TABLE OF CONTENTS For the Fiscal Year Ended June 30, 2017
Introductory Section ...................................................................................................................................... University System of Georgia Highlights ........................................................................................... 2 Letter of Transmittal ........................................................................................................................... 11
Financial Section ............................................................................................................................................ Independent Auditor's Report ............................................................................................................ 15 Management's Discussion and Analysis ............................................................................................ 19 Financial Statements (GAAP Basis) .................................................................................................. Statement of Net Position ........................................................................................................... 33 Statement of Revenues, Expenses and Changes in Net Position .............................................. 36 Statement of Cash Flows ............................................................................................................ 38 Fiduciary Funds .......................................................................................................................... Statement of Fiduciary Net Position ....................................................................................... 40 Statement of Changes in Fiduciary Net Position .................................................................... 41 Component Units ........................................................................................................................ Statement of Net Position ....................................................................................................... 42 Statement of Revenues, Expenses, and Changes in Net Position ......................................... 52 Notes to the Financial Statements .............................................................................................. 63 Note 1 - Summary of Significant Accounting Policies ............................................................. 64 Note 2 - Deposits and Investments ......................................................................................... 72 Note 3 - Accounts Receivable ................................................................................................. 79 Note 4 - Inventories ................................................................................................................ 80 Note 5 - Notes and Loans Receivable .................................................................................... 80 Note 6 - Capital Assets ........................................................................................................... 80 Note 7 - Advances .................................................................................................................. 81 Note 8 - Long-Term Liabilities ................................................................................................. 81 Note 9 - Service Concessions Arrangements ......................................................................... 82 Note 10 - Net Position ............................................................................................................ 85 Note 11 - Endowments ........................................................................................................... 85 Note 12 - Significant Commitments ........................................................................................ 86 Note 13 - Leases .................................................................................................................... 86 Note 14 - Retirement Plans .................................................................................................... 87 Note 15 - Risk Management ................................................................................................... 95 Note 16 - Contingencies ......................................................................................................... 97 Note 17 - Post-Employment Benefits Other Than Pension Benefits ....................................... 97 Note 18 - Operating Expenses with Functional Classifications ............................................... 103 Note 19 - Subsequent Event ................................................................................................... 103 Note 20 - Component Units .................................................................................................... 104

UNIVERSITY SYSTEM OF GEORGIA TABLE OF CONTENTS For the Fiscal Year Ended June 30, 2017
Required Supplementary Information .......................................................................................................... Benefit Pension Plans ....................................................................................................................... Schedule of Contributions for Defined Benefit Pension Plan ........................................................ 117 Schedule of Proportionate Share of Net Pension Liability ............................................................. 118 Schedule of Changes in Net Pension Liability ............................................................................... 119 Schedule of Employers' and Nonemployers' Net Pension Liability ............................................... 120 Schedule of Investment Returns ................................................................................................... 121 Notes to the Required Supplemental Information for Pension Plans ............................................ 122 Other Postemployment Benefits Plans .............................................................................................. Schedule of Funding Progress for Other Postemployment Benefits ............................................. 123 Schedule of Changes in Net Other Postemployment Benefit Liability ........................................... 124 Schedule of Net Other Postemployment Benefit Liability .............................................................. 125 Schedule of Investment Returns for Other Postemployment Benefits .......................................... 126 Notes to the Required Supplemental Information for Other Postemployment Benefit Plans......... 127
Supplementary Information ........................................................................................................................... Financial Statements (GAAP Basis) .................................................................................................. Statement of Net Position by Institution ........................................................................................ 131 Statement of Revenue, Expenses and Changes in Net Position by Institution ............................. 156 Statement of Net Position by Affiliated Organization ..................................................................... 173 Statement of Revenue, Expenses and Changes in Net Position by Affiliated Organization .......... 185 Statutory Basis Financial Statement (Non-GAAP Basis) ................................................................... Balance Sheet (Non-GAAP Basis) ................................................................................................ 197 Statement of Funds Available and Expenditures Compared to Budget (Non-GAAP Basis) .......... 198 Statement of Changes to Fund Balance by Program and Funding Source (Non-GAAP Basis) .... 204
Acknowledgments .......................................................................................................................................... 210

More than 325,000 students* enroll in the 28 public higher education institutions of the University System of Georgia (USG), helping contribute to communities across the state. The USG's economic impact, estimated at $16.8 billion annually, grew by more than $1 billion over the year before. Its institutions have generated almost 160,000 jobs across Georgia, an increase of nearly 10,000 jobs over last year.
*Fall 2017
2 The University System of Georgia

At the same time, our faculty compete nationally for sponsored research dollars that
this past year alone came to more than $1 billion. And the system continues to improve
student access and increase students' college attainment, fulfilling its core mission:
Knowledge.
3 Fiscal Year 2017 Annual Financial Report

Affordability

The Board of Regents kept tuition increases at 2 percent for the current academic year, following a zero percent increase the year before.
Tuition increases over the last five years have been limited to an average of 2.2 percent annually.
The number of mandatory student fee increases continues to decrease year-over-year, with a plan in place to additionally phase out mandatory meal plans for commuter students.
The system has also tried to maximize the potential of online resources, including the increased use of free, open-sourced electronic textbooks that save students nearly $20 million annually.

4

The University System of Georgia

Kennesaw State University's participation in the Foundations of Excellence in the First Year of College self-study led to the establishment of University College to provide greater visibility and significance to a variety of programs, academic support services, and projects geared toward KSU's growing undergraduate population.

56,845 58,043 58,817 60,362 62,545 64,936

65K

60K

55K

50K

45K

2012 2013 2014 2015 2016 2017

Student Success & Completion
Since Gov. Nathan Deal launched the Complete College Georgia initiative in 2011, the system has seen an 18 percent increase in the number of students annually earning degrees. From 54,000 in 2011 to almost 65,000 in 2017, the numbers have gone up for six consecutive years.
The creation of programs such as "degree roadmaps," a 15-to-finish campaign for fuller course loads and early-alert systems for when students stray from their chosen path has also supported institutional efforts to reduce students' time - and costs - toward graduation.
We are proud of our academic reputation: Georgia continues to be one of only three states with two institutions ranked among U.S. News & World Report's Top 20 public institutions in the nation.
Georgia is one of only three states with two institutions in the Top 10 of Kiplinger's Best College Values for public colleges. The USG also reached a milestone in 2017: All USG institutions now have dedicated space on campus to better serve students who are military veterans. The work of our campuses has been recognized by Military Times' "best for vets" list, with Georgia ranking as the only state with two public institutions on the Top 10 list.

5 Fiscal Year 2017 Annual Financial Report

Efficiency
Ongoing campus consolidations kept the system on-track toward improving services and opportunities especially in both South Georgia and Southeast Georgia.
An estimated $24 million in administrative costs have been saved as a result of consolidations systemwide, allowing the USG to reinvest that money into the classroom.
Further, in 2018, the system expects to support 26 institutions through consolidation to better serve the needs of surrounding communities by strategically aligning degree offerings with institutional strengths and regional needs.

6

The University System of Georgia

Studying at East Georgia State College can take many different paths. The main campus is in Swainsboro with extension campuses in Statesboro and Augusta. Small classes and flexible course offerings provide day, evening, weekend, and online options.

College
2025

Anew, systemwide initiative, College 2025, will help produce more college graduates from Georgia's public colleges and universities.
The effort's initial recommendations, expected in 2018, will build on the strengths of the system and its institutions by providing an academic roadmap to a 21st-century model for public higher education.
One of its biggest goals: Better position our degree programs to align with workforce needs.

Fiscal Year 2017 Annual Financial Report

7

Students First
The first of its kind for USG, the ongoing Comprehensive Administrative Review kicked off in 2017. It brings to fore a systemwide focus on improving administration by creating new efficiencies and streamlining processes to best serve the needs of all students.

8

The University System of Georgia

From the technology in every classroom to the tutors who give students that extra boost of confidence, the academic success of all students is at the core of everything done at Georgia Gwinnett College.

Board of Regents

C. Dean Alford, P. E.
Allied Energy Services
W. Paul Bowers
Georgia Power
Rutledge A. (Rusty) Griffin Jr.
Griffin LLC

Doreen Stiles Poitevint
Stiles Apartments and A.B. Stiles Enterprises
Neil L. Pruitt Jr.
PruittHealth Inc.
Sarah-Elizabeth Reed
First Lady, City of Atlanta

C. Thomas Hopkins Jr., MD (Chair)
OrthoGeorgia
James M. Hull (Vice Chair)
Hull Property Group

Sachin Shailendra
SG Contracting Inc.
E. Scott Smith
NW Services Corp.
Kessel D. Stelling Jr.
Synovus

Donald M. Leebern Jr.
Georgia Crown Distributing Company Inc.

Ben J. Tarbutton III
Sandersville Railroad Company

Laura Marsh
Taulbee, Rushing, Snipes, Marsh & Hodgin LLC

Richard L. Tucker
Arlington Capital LLC

Thomas Rogers Wade
Retired, Georgia Public Policy Foundation
Larry Walker
Walker, Hulbert, Gray & Moore
Don L. Waters
Waters Capital Partners LLC
Philip A. Wilheit Sr.
Wilheit Packaging and Marketing Images
University System of Georgia
Dr. Steve Wrigley (Chancellor)
University System of Georgia
Shelley C. Nickel (Treasurer)
University System of Georgia

9 Fiscal Year 2017 Annual Financial Report

SHELLEY C. NICKEL EXECUTIVE VICE CHANCELLOR FOR STRATEGY & FISCAL AFFAIRS 270 WASHINGTON STREET, S.W. ATLANTA, GEORGIA 30334

404-962-3241 SHELLEY.NICKEL@USG.EDU

December 21, 2017
Chancellor Steve Wrigley Board of Regents University System of Georgia
Dear Chancellor Wrigley:
We are pleased to present to you the Annual Financial Report of the University System of Georgia for the year ended June 30, 2017. The report provides financial information about the University System of Georgia's operations during the year and describes its financial position at the end of the fiscal year.
Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal controls established for this purpose, the objective of which is to provide reasonable assurance that the financial statements are free of material misstatements. Further, the officers of the various institutions of the University System of Georgia and its affiliated organizations have assured us that every effort has been made to reflect accurately the information considered important to all concerned parties.
State law, Federal guidelines, bond covenants and the by-laws of the Board of Regents require that the accounting and financial records of the University System of Georgia be audited each year. The Georgia Department of Audits and Accounts has performed the audit for fiscal 2016 and has issued an unmodified opinion, the most favorable outcome of the audit process. The State Auditor's report is located at the beginning of the financial section.
Management's discussion and analysis (MD&A) immediately follows the auditor's report and provides a narrative introduction, overview, and analysis of the basic financial statements. The MD&A complements this letter of transmittal and should be read in conjunction therewith.
Respectfully submitted,

Shelley C. Nickel Executive Vice Chancellor for Strategy and Fiscal Affairs/Treasurer Board of Regents of the University System of Georgia
"Creating A More Educated Georgia" www.usg.edu

2017 Annual Financial Report 11

12 University System of Georgia

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
Independent Auditor's Report

The Honorable Nathan Deal, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the Board of Regents of the University System of Georgia
and Dr. Steve Wrigley, Chancellor University System of Georgia
Report on the Financial Statements
We have audited the accompanying financial statements of the business-type activities, the aggregate discretely presented component units, and the aggregate remaining fund information of the University System of Georgia (USG), which is an organizational unit of the State of Georgia, as of and for the year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the USG's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial statements of the aggregate discretely presented component units. Those statements were audited by other auditors whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for the aggregate discretely presented component units, is based solely on the reports of the other auditors. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. Except for the Augusta University Research Institute Inc., AU Health Systems, Inc., AU Medical Associates & Subsidiaries, Georgia Tech Research Corporation, and the University of Georgia Research Foundation, Inc. the other auditors did not audit the discretely presented component units' financial statements in accordance with Government Auditing Standards.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the USG's preparation and fair
2017 Annual Financial Report 15

presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the USG's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinions
In our opinion, based on our audit and the reports of other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of the of the business-type activities, the aggregate discretely presented component units and the aggregate remaining fund information of the USG as of June 30, 2017, and the respective changes in financial position and where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Emphasis of Matter
As described in Note 1, the financial statements of the USG are intended to present the financial position, the changes in financial position, and where applicable, cash flows of only those portions of the businesstype activities, aggregate discretely presented component units and the aggregate remaining funds of the State of Georgia that are attributable to the USG's transactions. They do not purport to, and do not, present fairly the financial position of the State of Georgia as of June 30, 2017, the changes in its financial position, or, where applicable, its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Our opinions are not modified with respect to this matter.
As described in Note 1 to the financial statements, in 2017, the USG adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 74, Financial Reporting for Postemployment Benefits Plans Other than Pension Plans, GASB Statement No. 77, Tax Abatement Disclosures, GASB Statement 78, Pensions Provided through Certain Multiple-Employer Defined Benefit Pension Plans, GASB Statement No. 80, Blending Requirements for Certain Component Units, and GASB Statement No. 82, Pension Issues. Our opinions are not modified with respect to these matters.
As described in Note 1 to the financial statements, in 2017, the beginning net positions for the USG's business-type activities and aggregate discretely presented component units were restated due to changes in financial reporting entities and corrections of prior year errors. Our opinions are not modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis, Schedule of Contributions to Defined Benefit Pension Plan, Schedule of Proportionate Share of Net Pension Liability, Schedule of Changes in Net Pension Liability, Schedule of Employers' and Nonemployers' Net Pension Liability, Schedule of Investment Returns, Notes to the Required Supplemental Information, Schedule of Funding Progress and Employer Contributions for Other Postemployment Benefits, Schedule of Changes in Net OPEB Liability, Schedule of Net OPEB Liability, Schedule of Investment Returns, and Notes to the Required Supplemental Information for Other Postemployment Benefits as listed in the table of contents, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency
16 University System of Georgia

with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary and other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the USG's basic financial statements. The introductory section, and accompanying supplementary information as listed in the table of contents are presented for purposes of additional analysis and are not required parts of the basic financial statements. Such information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly we do not express an opinion or provide any assurance on it.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we will issue our report on our consideration of the USG's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters at a future date. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the USG's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the USG's internal control over financial reporting and compliance.
Respectfully submitted,

December 21, 2017

Greg S. Griffin State Auditor

2017 Annual Financial Report 17

18 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA Management's Discussion and Analysis
Introduction The University System of Georgia (USG) has a long tradition of teaching, research and public service that provides broad, affordable access to higher education across the State of Georgia. The USG is one of only three states with two institutions ranked among the Top 20 public institutions in the nation by U. S. News & World Report. The USG is comprised of 28 higher education institutions including four research universities, four comprehensive universities, 10 state universities and 10 state colleges. In academic year 2016-2017, the University System's institutions enrolled over 321,000 students and conferred a total of 64,936 degrees including 39,911 bachelors', 11,462 masters and 1,762 doctorate degrees. The role of public higher education in Georgia is to create a more educated Georgia that attends to the current and developing needs of the state and its citizens and students. The USG is committed to fulfilling this role by ensuring more Georgians enter the workforce with college credentials, making college more affordable and accessible for Georgians and finding opportunities to be more efficient and control costs.
This discussion and analysis provides a summary of the financial position of the USG for the fiscal year ending June 30, 2017. It will provide the user with an overview of how the USG utilized its resources in pursuit of its primary goals of teaching, research and public service.
The Board of Regents and Chancellor Steve Wrigley are charged with the leadership of the 28 institutions of the USG. The USG continues to prosper, as is demonstrated by the following information:
State Resources The General Appropriations Act of 2017 (House Bill 751), as amended by House Bill 43, appropriated a total of $2.15 billion to the USG. The following table presents the state appropriations available to the USG from the General Appropriations Act of 2017, as amended:

STATE APPROPRIATIONS AVAILABLE - GENERAL APPROPRIATIONS ACT OF 2017

House Bill 751

General State Funds

$ 2,145,702,074

House Bill 43

General State Funds

7,265,348

Total State Appropriations Per Appropriations Act - University System of Georgia

$

2,152,967,422

The following table presents the Fiscal Year 2017 allocations by the Board of Regents to the USG institutions:

ALLOCATIONS BY THE BOARD OF REGENTS

Education and General

Teaching

$

Non-Teaching

Other Activities

University System Office

$

12,063,606

Rental Payments - GA Military College

7,298,849

GA Public Telecommunications Commission

15,154,949

GA Public Libraries

36,208,155

Total Other Activities

Special Initiative Funding

Net State Appropriations Available to the University System of Georgia

1,903,568,206 152,249,162
70,725,559 26,424,495
$

2,152,967,422

2017 Annual Financial Report 19

The following chart illustrates the Board of Regents allocations to Teaching, Non-Teaching, Other Activities and Special Funding Initiatives:
Overview of the Financial Statements and Financial Analysis The USG is proud to present its consolidated financial statements for fiscal year 2017. These statements contain information from the 28 institutions of the USG, and the University System Office. These financial statements include: three consolidated financial statements (1) Statement of Net Position, (2) Statement of Revenues, Expenses and Changes in Net Position, and (3) Statement of Cash Flows; Fiduciary Fund statements for the Board of Regents Retiree Health Benefit Fund, the Early Retirement Plan - Augusta University and the USG Deferred Compensation Plan; and combining component unit financial statements for 26 discretely presented component units. These 26 organizations are legally separate tax-exempt component units of the State of Georgia. The emphasis of discussions about these statements will be on current year data of the USG. The Notes to the Financial Statements follow the combining component unit financial statements, and contain essential information that serves both to support and clarify the information presented in the financial statements preceding them. The Required Supplementary Information section contains additional information related to the Board of Regents Retiree Health Benefit Fund, the Early Retirement Plan - Augusta University, retirement plans for which the USG and its institutions participates and other post employment benefits as required by generally accepted accounting principles. Finally, the Supplementary Information section includes selected information by USG institution, affiliated organizations and USG consolidated financial statements presented on a statutory/budget basis. During fiscal year 2017, changes to the bylaws for Georgia Southern University Housing Foundation, Inc., UWG Real Estate Foundation, Inc., and VSU Auxiliary Services Real Estate Foundation were made. These foundations, previously reported as blended component units, no longer met requirements for inclusion in the financial reporting entity as business-type activities. However, the determination was made that it would be misleading to exclude these foundations from the financial reporting entity. Therefore, these foundations are reported as discretely presented component units.
20 University System of Georgia

The effect of these reporting changes was a decrease to business-type activity beginning net position in the amount of $50.9 million. See Restatement Note for additional information.
This discussion and analysis of the USG's consolidated financial statements provides an overview of its financial activities for the fiscal year. Further information is provided by comparative data for fiscal year 2017 and 2016.
Statement of Net Position
The Statement of Net Position presents the assets, deferred outflows of resources, liabilities, deferred inflows of resources, and net position of the USG as of the end of the fiscal year. The Statement of Net Position is a point of time financial statement. The purpose of the statement is to present to the reader a fiscal snapshot of the USG. The Statement of Net Position presents data concerning assets (property that we own and what we are owed by others), deferred outflows of resources (consumption of net position by the USG that is applicable to future reporting periods), liabilities (what we owe to others and have collected from others before we have provided the service), deferred inflows of resources (acquisition of net position by the USG that is applicable to future reporting periods), and net position. It is prepared under the accrual basis of accounting, which requires revenue and asset recognition when the service is provided, and expense and liability recognition when goods or services are received despite when cash is actually exchanged.
From the data presented, readers of the Statement of Net Position are able to determine the assets available to continue operations of the USG. They are also able to determine how much the USG owes vendors and investors. The difference between assets, deferred outflows of resources, liabilities, and deferred inflows of resources (net position) is one indicator of the USG's financial health when considered in conjunction with other nonfinancial conditions, such as facilities and environment.
Net position is divided into three major categories. The first category, net investment in capital assets, provides the USG's equity in property, plant and equipment owned. The next category is restricted, which is divided into two categories, non-expendable and expendable. Restricted, non-expendable net position consists solely of the USG's permanent endowment funds. The corpus of non-expendable, restricted resources is available only for investment purposes. Restricted, expendable resources are available for expenditure, however, expenditure of these resources is limited to time or purpose restrictions placed on the assets by the donor and/or external third parties. The final category is unrestricted resources, which are available to the USG for any lawful purpose.
The USG's financial position at June 30, 2017 is very strong, with total assets of $12,616 million, deferred outflows of $889 million, total liabilities of $9,683 million, deferred inflows of $730 million and net position of $3,093 million.
Assets and Deferred Outflows Total assets and deferred outflows of the USG in fiscal 2017 were approximately $928 million more than those reported for fiscal 2016. Although most asset and deferred outflow categories had marginal increases during the year, the areas with significant growth were in capital assets and deferred loss on defined benefit pension plan. The $248 million increase in capital assets was primarily related to major building additions as discussed in the capital asset section. The increase in deferred loss on defined benefit pension plan was $539 million and is based on actuarial estimates.
Liabilities and Deferred Inflows Total liabilities and deferred inflows for fiscal 2017 were approximately $942 million more than those reported for fiscal 2016. The majority of the change related primarily to an increase in net OPEB liability of $260 million, an increase in net pension liability of $815 million and a decrease in deferred gain on defined benefit pension plan of $185 million.
Net Position The combination of the increase in total assets and deferred outflows of $928 million and the increase in total liabilities and deferred inflows of $942 million yielded a net decrease in total net position of $14 million or .43%.
2017 Annual Financial Report 21

The following table summarizes the USG's assets, deferred outflows, liabilities, deferred inflows and net position as of June 30, 2017 and June 30, 2016.

CONDENSED STATEMENT OF NET POSITION ASSETS Current Assets Capital Assets, Net Other Assets TOTAL ASSETS
DEFERRED OUTFLOWS
LIABILITIES Current Liabilities Non-Current Liabilities TOTAL LIABILITIES
DEFERRED INFLOWS
NET POSITION Net Investment in Capital Assets Restricted, Non-Expendable Restricted, Expendable Unrestricted (Deficit) TOTAL NET POSITION

June 30, 2017

June 30, 2016 % Change

$ 2,172,184,004 $ 2,182,073,507

9,962,908,062

9,714,556,337

480,893,886

331,144,746

12,615,985,952 12,227,774,590

889,122,408

349,131,299

(0.45)% 2.56 % 45.22 % 3.17 %
154.67 %

882,875,681 8,800,064,037 9,682,939,718
729,574,530

858,090,200 7,841,446,870 8,699,537,070
771,299,183

2.89 % 12.23 % 11.30 %
(5.41)%

6,627,744,225

6,428,995,230

193,258,875

181,152,225

249,285,321

258,325,439

(3,977,694,309) (3,762,403,258)

$ 3,092,594,112 $ 3,106,069,636

3.09 % 6.68 % (3.50)% (5.72)% (0.43)%

Statement of Revenues, Expenses and Changes in Net Position
The Statement of Revenues, Expenses and Changes in Net Position presents the revenues received and expenses incurred during the year. Activities are reported as either operating or non-operating. Changes in total net position as presented on the Statement of Net Position are based on the activity presented in the Statement of Revenues, Expenses and Changes in Net Position. The purpose of the statement is to present the revenues received by the USG, both operating and non-operating, and the expenses paid by the USG, operating and non-operating, and any other revenues, expenses, gains or losses received or spent by the USG.
Generally, operating revenues are received for providing goods and services to the various customers and constituencies of the USG. Operating expenses are those expenses paid to acquire or produce the goods and services provided in return for the operating revenues, and to carry out the mission of the USG. Non-operating revenues are revenues received for which goods and services are not provided. For example, state appropriations are non-operating because they are provided by the legislature to the USG without the legislature directly receiving commensurate goods or services for those revenues. State capital grants and gifts and other capital grants and gifts are considered neither operating nor non-operating revenues and are reported after "Income (loss) before other revenues, expenses, gains or losses".

22 University System of Georgia

Some highlights of the information presented on the Statement of Revenues, Expenses and Changes in Net Position are as follows:

CONDENSED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION Operating Revenue Operating Expense Operating Income/Loss Non-Operating Revenue and Expense Income (Loss) before Other Revenues, Expenses, Gains, Losses and Special Items Other Revenues, Expenses, Gains, Losses and Special Items Change in Net Position Net Position at beginning of year, restated Net Position at End of Year

June 30, 2017 June 30, 2016 % Change

$ 5,100,949,696 $ 4,942,578,920

3.20 %

8,012,168,406 7,563,231,051

5.94 %

(2,911,218,710) (2,620,652,131) 11.09 %

2,715,233,106 2,573,877,693

5.49 %

(195,985,604) (46,774,438) 253,795,618 216,219,773
57,810,014 169,445,335 3,034,784,098 2,936,624,301 $ 3,092,594,112 $ 3,106,069,636

319.00 % 17.38 % (65.88)% 3.34 % (0.43)%

The Statement of Revenues, Expenses and Changes in Net Position reflect a positive year, which is represented by an increase in net position at the end of the year. Some highlights of the information presented on this statement are as follows:
Revenues In fiscal year 2017, state appropriations increased $127 million (6.28%), grants and contracts revenue increased $114 million in fiscal 2017, net tuition and fee revenues increased $52 million (2.60%), which is a direct result of enrollment increases across the USG as the Board of Regents voted in April 2016 for a 0% tuition increase for academic calender 2016-2017.
Revenue by source (state appropriations, grants and contracts, tuition and fees, auxiliaries, gifts and other sources) is depicted by the following chart:

2017 Annual Financial Report 23

For the years ended June 30, 2017 and June 30, 2016, revenues by source were as follows:

REVENUES BY SOURCE Tuition and Fees Federal Appropriations Grants and Contracts Sales and Services Auxiliary Enterprises Other Operating Revenues Total Operating Revenues State Appropriations Grants and Contracts Gifts Investment Income Other Nonoperating Revenues Total Nonoperating Revenues State Capital Gifts and Grants Other Capital Gifts and Grants Total Capital Gifts and Grants Additions to Permanent and Term Endowments Special Items Extraordinary Items Total Revenues

June 30, 2017 June 30, 2016 % Change

$ 2,056,150,625 $ 2,004,007,512

2.60%

22,307,653

23,256,605

-4.08%

1,727,419,012 1,598,859,536

8.04%

211,924,571 201,525,559

5.16%

901,424,177 879,352,298

2.51%

181,723,658 235,577,410 -22.86%

5,100,949,696 4,942,578,920

3.20%

2,149,978,108 2,022,898,745

6.28%

631,236,442 644,168,021

-2.01%

58,987,556

63,864,580

-7.64%

44,016,277

22,093,201

99.23%

(7,012,157)

(7,749,845)

9.52%

2,877,206,226 2,745,274,702

4.81%

210,403,556 161,760,376

30.07%

40,339,044

54,057,507 -25.38%

250,742,600 215,817,883

16.18%

833,158

136,762

2,219,860

(466,637)

--

731,765

$ 8,231,951,540 $ 7,904,073,395

4.15%

Expenses For the years ended June 30, 2017 and June 30, 2016, expenses by functional classification were as follows:

EXPENSES BY FUNCTIONAL CLASSIFICATION Instruction Research Public Service Academic Support Student Services Institutional Support Plant Operations and Maintenance Scholarships and Fellowships Auxiliary Enterprises Patient Care Total Operating Expenses Interest Expense Total Expenses

June 30, 2017 June 30, 2016 % Change

$ 1,996,478,175 $ 1,855,174,302

7.62%

1,371,184,188 1,237,468,372

10.81%

419,784,258 384,461,774

9.19%

608,363,683 578,513,449

5.16%

354,756,483 345,867,103

2.57%

1,173,262,400 1,093,516,279

7.29%

651,415,644 675,542,298

-3.57%

254,895,457 273,083,776

-6.66%

829,020,400 786,195,518

5.45%

353,007,718 333,408,180

5.88%

8,012,168,406 7,563,231,051

5.94%

161,973,120 171,397,009

-5.50%

$ 8,174,141,526 $ 7,734,628,060

5.68%

24 University System of Georgia

Total operating expenses were $8 billion in fiscal year 2017, an increase of $449 million (5.94%) when compared with fiscal year 2016. These increases are primarily attributable to the following functional classifications: Instruction ($141 million); Research ($134 million); Auxiliaries ($43 million); Academic Support ($30 million); Student Services ($9 million); and Institutional Support ($80 million). These amounts were partially offset by a decrease in Scholarships and Fellowships ($-18 million) and Plant Operations ($-24 million). As noted above, operating expenses increased $449 million (5.94%) in fiscal year 2017 when compared with fiscal year 2016. The increases were substantially attributable to salaries and benefits, including other personal services. The increases in salaries and benefits are attributable to increases in pension expenses, OPEB expenses, faculty and staff increases, and merit increases. The following chart depicts the fiscal year 2017 operating expenses by functional classification.
2017 Annual Financial Report 25

The following chart depicts the fiscal 2017 operating expenses by natural classification.
Statement of Cash Flows The Statement of Cash Flows presents detailed information about the cash activity of the USG during the year and is divided into five sections. The first section is concerned with operating cash flows and reflects the net cash used by the various operating activities of the USG. The second section is related to cash flows from non-capital financing activities, which reflects the cash received and spent for non-capital financing purposes. The third section summarizes cash flows from capital and related financing activities and contains cash used for the acquisition and construction of capital and related items. The fourth section is comprised of the cash flows from investing activities and includes the purchases, proceeds and interest received from investing activities. The fifth, and final, section reconciles the net cash used to the operating income or loss as reflected on the Statement of Revenues, Expenses and Changes in Net Position.
26 University System of Georgia

Cash Flows for the Years Ended June 30, 2017 and 2016, Condensed

CONDENSED STATEMENT OF NET CASH FLOWS Cash & Cash Equivalents Provided (Used) by:
Operating Activities Non-Capital Financing Activities Capital and Related Financing Activities Investing Activities NET CHANGE IN CASH & CASH EQUIVALENTS Cash & Cash Equivalents, beginning of year (restated) CASH & CASH EQUIVALENTS, end of year

June 30, 2017

June 30, 2016

$ (2,101,268,541) $ (2,055,596,835)

2,839,760,642

2,624,357,105

(595,935,831)

(560,368,512)

18,969,608

391,699,933

$

161,525,878 $

400,091,691

1,360,411,923

1,015,798,878

$

1,521,937,801 $

1,415,890,569

Capital Assets Capital assets, net of accumulated depreciation, at June 30, 2017 and June 30, 2016 were as follows:

CAPITAL ASSETS, net of accumulated depreciation Land Capitalized Collections Construction Work-in-Progress Software Development-in-Progress Infrastructure Building and Building Improvements Facilities and Other Improvements Equipment Library Collections Capitalized Collections Software Capital Assets, net of accumulated depreciation

June 30, 2017 June 30, 2016

$ 405,224,031 $ 399,862,879

51,448,435

49,224,934

222,618,967 240,024,172

9,521,221

--

231,652,649 223,220,648

8,093,169,192 7,885,112,643

276,854,639 267,144,784

450,656,786 448,462,076

174,917,795 175,100,747

5,270,189

5,400,177

41,574,158

21,003,277

$9,962,908,062 $9,714,556,337

% Change 1.34% 4.52% -7.25%
100.00% 3.78% 2.64% 3.63% 0.49% -0.10% -2.41%
97.94% 2.56%

As shown above, capital assets, net of accumulated depreciation increased $248 million, or 2.56% during fiscal year 2017 when compared with fiscal year 2016. Major building additions constituted $541 million of the capital asset additions. Major building additions included $155 million in dormitories associated with the P3 Service Concession arrangement, Business Learning Center and Science Learning Center at the University of Georgia, Military and Veterans Academic and Training Center at Middle Georgia State University, an Academic Building at Georgia Gwinnett College and a Military Science Building at Georgia Southern University.
For additional information concerning Capital Assets, see Notes 1, 6, 8, and 13 in the Notes to the Financial Statements.
Long-Term Liabilities The University System of Georgia had Long-Term Liabilities of $9 billion of which $240 million was reflected as a current liability at June 30, 2017. Included in Long-Term Liabilities are lease purchase obligations of $3 billion, net pension liability of $3.1 billion and OPEB obligation of $2.6 billion.
The net pension liability and OPEB obligation are actuarially determined estimates of future post-employment costs. See Note 14 in the Notes to Financial Statements for additional information related to net pension liability. See Note 17 in the Notes to Financial Statements for additional information related to the OPEB obligation.

2017 Annual Financial Report 27

In fiscal year 2018, the USG will adopt GASB Statement No. 75, Accounting and Financial Reporting for Post Employment Benefits Other Than Pensions. With the adoption of this Statement, the USG will no longer report the OPEB obligation. Instead, the USG will report a net OPEB liability, which is approximately $4.2 billion related to the Board of Regents Retiree Health Benefit Plan as of June 30, 2017.
Lease purchase obligations decrease $63 million during the current fiscal year. This net decrease is mostly related to $83 million in principal payments offset by $18 million in new capital leases resulting in new fixed assets for the USG. The remaining lease activity during the current fiscal year was predominantly related to refinancing activities.
For additional information concerning Long-Term Liabilities, see Note 8 in the Notes to the Financial Statements.
Notes to the Financial Statements The Notes to the Financial Statements are an integral part of the basic financial statements and communicate information essential for fair presentation. For example, the notes convey information concerning significant accounting policies used to prepare the financial statements, detailed information on cash and investments, receivables, capital leases, compensated absences, retirement and other post-employment benefits, capital assets and a report of operating expenses by function.
Retiree Health Benefit Fund The University System Office is the custodian of the Board of Regents Retiree Health Benefit Fund. This fund was authorized pursuant to the Official Code of Georgia Annotated Section 47-21-21 for the purpose of accumulating funds necessary to meet employer costs of post-employment health insurance benefits.
As noted in the Long-Term Liabilities section above, the USG carries an OPEB Obligation liability of $2.6 billion as of June 30, 2017. The Board of Regents continues to evaluate options to reduce this growing liability.
For additional information concerning the Retiree Health Benefit Fund, please refer to Note 15 and 17 in the Notes to Financial Statements.
Early Retirement Pension Plan Fund - Augusta University Augusta University Early Retirement Pension Plan (ERP) is a single-employer defined benefit pension plan administered by Bryan, Pendleton, Swats and McAlister. The plan was devised by Augusta University as a means of manpower reduction and was approved by the Board of Regents of the USG of Georgia effective January 1, 2000.
For additional information concerning the Early Retirement Pension Fund, please refer to Note 14 in the Notes to Financial Statements.
Affiliated Organizations System-wide, there were 26 affiliated organizations that met one or more criteria for inclusion as component units of the State of Georgia in compliance with GASB Statement No. 14, as amended. These 26 affiliated organizations are included as component units in the University System of Georgia consolidated annual financial statements as they have been determined essential to the fair presentation to these departmental statements. All system-wide affiliated organizations including the 26 previously mentioned are included in the supplementary information section.
Economic Outlook The USG is committed to continue to work hard to ensure that our institutions remain a strong value for Georgia's residents. An enhanced focus on ensuring that students can afford and earn degrees has resulted in an increased emphasis on restructuring public higher education in Georgia to work more efficiently and effectively. The USG recognizes that increases in higher education spending, particularly in administrative spending, is a national concern. The USG strives to address the challenges of how to provide quality instruction in the most cost-effective manner. As part of the USG's continued commitment, in April 2017, Chancellor Wrigley announced the plans for a comprehensive administrative review across the USG. This system-wide initiative will be focused on creating administrative efficiencies, streamlining processes and finding ways to more effectively utilize USG resources.
Predictions for Georgia's workforce needs for 2025 are significant. Global economic indicators reveal that in the near future, two-thirds of the workforce will require some level post-secondary credentials to compete for jobs. Preparing Georgia for the future requires an increase in the number of Georgians who have degrees. In order to continue to be competitive globally, Georgia needs to increase the number of Georgians with degrees from the 2016 census data level of 47.9% to a targeted 60 percent of the population by 2025. Over the past five years, Georgia has seen positive movement in residents with post-secondary credentials in part based on several initiatives of the USG ranging from
28 University System of Georgia

new teaching methods, better advising and giving credit for experiential learning, but there is still work to be done. In October 2017, Chancellor Wrigley announced the launching of "College 2025". "College 2025" will focus on developing a five to 10 year academic road map of how college will look in 2025. In 2011, the USG graduated 54,855 students. The USG has been working to increase that number year-over year, and in 2016-17, 64,936 students graduated from USG institutions reflecting a 18% increase over the past six years. The USG still has a long way to reach its goal of graduating 80,000 students a year, but is confident about the progress made and believes it is on track to achieving the goal. The consolidation of fourteen institutions into seven has been successfully completed and the consolidations of Georgia Southern University and Armstrong State University, and Abraham Baldwin Agricultural College and Bainbridge State College are in the final stages. Consolidation provides opportunities for funds to be shifted from administration to the classroom advancing the USG's commitment to operational efficiency and good stewards of its resources. As a labor-intensive organization, the USG faces competitive pressures related to attracting and retaining quality faculty and staff. As is the case nationally, the USG also faces the rising costs of health-care benefits, but will continue to take proactive measures to mitigate these rising costs. A key component of the USG's success and future is the strong relationship with Governor Nathan Deal and the Georgia General Assembly. Due to their support and the excellent leadership of the Board of Regents and Chancellor Wrigley, the USG will continue to provide access to an affordable and quality education for the citizens of the State of Georgia.
2017 Annual Financial Report 29

30 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION JUNE 30, 2017
ASSETS Current Assets Cash & Cash Equivalents Short-term Investments Accounts Receivable, net Federal Financial Assistance Affiliated Organizations Component Units Primary Government Other Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES
The notes to the financial statements are an integral part of this statement.

University System of Georgia

Component Units

$

1,515,931,574 $

31,443,424

83,511,949 11,968,910 189,069,754
-- 255,965,687
-- -- -- 23,652,977 58,399,894 2,239,835 2,172,184,004

-- -- 3,600,830 3,096,400 -- -- 240,151,830 41,344,081 -- -- -- 6,006,227 20,876 186,673,642 9,962,908,062 10,443,801,948 12,615,985,952

28,001,791

861,120,617

--

$

889,122,408 $

333,757,009 183,313,869
5,254,618 3,515,078
-- 9,026,217 379,329,818
600,000 76,503,156
327,503 19,245,590 37,774,863 21,384,637 1,070,032,358
201,293,696 --
6,771,775 --
171,521,812 235,809
1,651,490,772 1,305,604
2,261,788,537 4,466,472
59,900,643 -- --
1,757,843,045 1,112,342,848 7,228,961,013 8,298,993,371
55,492,590 --
3,961,146 59,453,736

2017 Annual Financial Report 33

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION JUNE 30, 2017
LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities
Non-Current Liabilities Due to Affiliated Organizations Due to Primary Government Due to Other Funds Advances (Including Tuition & Fees) Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
The notes to the financial statements are an integral part of this statement.

University System of Georgia

Component Units

$

159,075,711 $

123,892,738

26,687,684

12,233,048

67,571,355

--

28,459,019

1,096,841

8,608,245

--

1,745,503

3,060,447

9,026,217

--

--

189,069,754

226,262,793

127,480,622

16,165,362

38,211,074

96,405,670

35,508,468

3,082,954

16,304,908

1,408,512

40,967,360

21,607,631

8,475,621

72,312,993

--

--

84,440,825

--

2,488,373

--

5,619,975

618,915

601,341

903,825

1,575,564

142,933,292

19,192,107

882,875,681

710,219,066

--

7,002,000

--

3,096,400

--

621,301

2,295

5,822,019

--

29,875,969

8,095,784

162,848,614

683,809,244

83,725,494

2,265,189,190

--

--

3,013,929,856

--

26,631,757

--

52,237,373

609,515

--

1,786,568

650,740

77,302,749

--

2,616,065,894

11,531,792

3,147,202,798

--

8,800,064,037

3,397,973,315

$

9,682,939,718 $

4,108,192,381

34 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION JUNE 30, 2017
DEFERRED INFLOWS OF RESOURCES Deferred Gain on Debt Refunding Deferred Funds Received in Advance of Timing Requirements Deferred Service Concession Arrangements Deferred Gain on Defined Benefit Pension Plans Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION
The notes to the financial statements are an integral part of this statement.

University System of Georgia

Component Units

$

34,141,243

37,507,642 $

599,866,404

58,059,241

--

729,574,530

-- 17,264,201
-- -- 2,130,394 19,394,595

6,627,744,225

193,258,875 249,285,321 (3,977,694,309)

$

3,092,594,112 $

335,166,021
1,602,522,928 1,538,449,523
754,721,659
4,230,860,131

2017 Annual Financial Report 35

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition & Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
The notes to the financial statements are an integral part of this statement.

University System of Georgia

Component Units

$

2,056,150,625

--

22,307,653

--

855,519,824 $ 279,958,143 591,941,045 211,924,571
5,708,600

710,616,663 8,643,005
302,863,201 105,813,385 239,092,654

331,656,170 65,130,498
199,607,476 88,992,424 58,561,977
129,585,687 27,889,945 -- --
176,015,058

-- -- 1,941,197 -- 753,080,486 130,318,885 -- 155,604,139 11,241,919 25,132,709

5,100,949,696

2,444,348,243

1,618,532,967 2,057,604,725 1,150,996,092
15,369,139 78,597,124 313,372,296 176,597,224 2,115,282,325 485,816,514

8,012,168,406

$

(2,911,218,710) $

-- 306,269,726
82,473,917 169,553,187
25,249,031 30,562,111
7,987,334 1,730,128,232
66,882,522
2,419,106,060
25,242,183

36 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION FOR FISCAL YEAR ENDED JUNE 30, 2017

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues
Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item Extraordinary Item
Total Other Revenues, Expenses, Gains or Losses
Change in Net Position Net Position, Beginning of Year, Restated
Net Position, End of Year
The notes to the financial statements are an integral part of this statement.

University System of Georgia

Component Units

$

2,149,978,108 $

31,409,501

538,164,379 8,818,243
84,253,820 58,987,556 44,016,277 (161,973,120) (7,012,157)

2,967,388 3,178,581
741 21,919,065 369,843,437 (130,450,985) (33,803,859)

2,715,233,106

265,063,869

(195,985,604)

290,306,052

1,396,674 210,403,556
38,942,370 833,158
2,219,860 --

88,747 1,000,000 3,955,837 112,757,790 (277,090) (3,324,141)

253,795,618

114,201,143

57,810,014 3,034,784,098

404,507,195 3,826,352,936

$

3,092,594,112 $

4,230,860,131

2017 Annual Financial Report 37

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CASH FLOWS FOR FISCAL YEAR ENDED JUNE 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES Payments from Customers Federal Appropriations Grants & Contracts (Exchange) Payments to Suppliers Payments to Employees Payments for Scholarships and Fellowships Loans Issued to Students Collection of Loans from Students Other Receipts Other Payments
Net Cash Used by Operating Activities
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES State Appropriations Agency Funds Transactions - Receipts Agency Funds Transactions - Disbursements Gifts and Grants Received for Other Than Capital Purposes Transfer of Endowments to Affiliated Organization Other Noncapital Financing Receipts Other Noncapital Financing Payments
Net Cash Flows Provided by Non-capital Financing Activities
CASH FLOWS FROM CAPITAL & RELATED FINANCING ACTIVITIES Capital Gifts & Grants Received Proceeds from Sale of Capital Assets Purchases of Capital Assets Principal Paid on Capital Debt & Leases Interest Paid on Capital Debt & Leases
Net Cash Used by Capital & Related Financing Activities
CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from Sales & Maturities of Investments Investment Income Purchase of Investments
Net Cash Provided by Investing Activities
Net Increase in Cash & Cash Equivalents Cash & Cash Equivalents, Beginning of year (Restated)
Cash & Cash Equivalents - End of Year
The notes to the financial statements are an integral part of this statement.
38 University System of Georgia

University System of Georgia

$

3,324,689,760

20,041,356

1,713,075,576

(3,165,821,053)

(3,692,773,887)

(313,372,296)

(9,959,556)

10,546,440

14,603,658

(2,298,539)

(2,101,268,541)

2,149,978,108 4,994,049,647 (4,980,590,442)
675,716,804 (1,800,840) 18,633,627
(16,226,262) 2,839,760,642

85,446,337 8,222,850
(442,371,662) (84,532,553)
(162,700,803) (595,935,831)

967,022,081 28,068,433
(976,120,906) 18,969,608

161,525,878 1,360,411,923

$

1,521,937,801

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CASH FLOWS FOR FISCAL YEAR ENDED JUNE 30, 2017
RECONCILIATION OF OPERATING LOSS TO NET CASH USED BY OPERATING ACTIVITIES:
Operating Loss Adjustments to Reconcile Net Operating Loss to Net Cash Used by Operating Activities
Depreciation Operating Expenses Related to Noncash Gifts Change in Assets & Liabilities:
Receivables, net Inventories Prepaid Items Notes Receivable, Net Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Deposits Advances (Including Tuition & Fees) Other Liabilities Funds Held for Others Compensated Absences Due to Affiliated Organizations Pollution Remediation Claims & Judgments Net Pension Liability Other Post-Employment Benefit Liability Change in Deferred inflows/outflows of resources:
Net Cash Used by Operating Activities
NON-CASH INVESTING, NON-CAPITAL FINANCING, & CAPITAL & RELATED FINANCING TRANSACTIONS
Non-capital Financing Activities Change in Accounts Receivable, Net of Allowances Recognition of Non-capital Financing Activities Change in Advances & Deferred Inflows Non-Capital Gift Reducing Proceeds of Grants & Contracts Capital Financing Activities Change in Accounts Receivable, Net of Allowances Gift of Capital Assets Loss on Disposal of Capital Assets Adjustments to Capital Asset Beginning Balance Ran Through Current Year Activity Change in Capital Asset Related Payables Capital Assets Acquired by Incurring Capital Lease Obligations Gain/Loss on Capital Debt Refunded Increase in Capital Debt due to Capitalized Interest Extinguishment of Capital Debt Adjustments to Capital Debt Beginning Balance Ran Through Current Year Activity Amortization of Deferred Gain/Loss of Capital Debt Refunded Change in Accrual of Capital Financing Interest Payable Gifts of Capital Assets Reducing Proceeds of Capital Gifts & Grants Unrealized Gain/Loss on Investments Deferred Concession Arrangement Capital Gift Recognition of Capital Financial Activities Advances & Deferred Inflows Reducing Proceeds of Capital Grants
The notes to the financial statements are an integral part of this statement.

University System of Georgia

$

(2,911,218,710)

485,816,514 946,149

(35,891,834) 1,732,619 (8,798,716) 585,003 (9,502,711) 4,351,337 827,607 (127,177) (11,282) (1,546,336) (3,572,463) 632,698 (18,971)
10,217,864 2,053,162 7,011 (1,951,543)
815,472,595 260,198,123 (711,469,480)

$

(2,101,268,541)

$

564,189

$

13,055,980

$

(944,541)

$

(3,261,257)

$

320,268,661

$

(7,222,860)

$

2,012,336

$

(6,002,091)

$

(18,252,784)

$

11,671,856

$

(89,429)

$

8,635,267

$

127,565

$

345,609

$

230,264

$

(320,268,661)

$

15,947,844

$

154,886,179

$

3,155,541

2017 Annual Financial Report 39

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF FIDUCIARY NET POSITION JUNE 30, 2017

ASSETS Cash & Cash Equivalents Investments Bond Securities Money Market Mutual Funds Mutual Bond Funds Equity Mutual Funds - Domestic Equity Mutual Funds - International Equity Securities - Domestic Guaranteed Investment Contracts Pooled Investment Other Investments

Early Retirement Plan - Augusta
University

Deferred Compensation
Fund

Retiree Health Benefit Fund

$

6,241,462

$

8,260,565 $

12,190,357 $
44,174,540
27,801,706

339,142 1,029,602 4,949,651
414,329
446,342
414,753

7,101,556

Total Assets

90,408,065

7,593,819

15,362,121

LIABILITIES Accounts Payable Benefits Payable

7,302 7,497,596

Total Liabilities

--

--

7,504,898

NET POSITION Held in Trust for: Other Employment Benefits Pension Benefits Other Postemployment Benefits

90,408,065

7,593,819

7,857,223

Total Net Position

$

90,408,065 $

7,593,819 $

7,857,223 $

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

Total
14,502,027
12,190,357 339,142
1,029,602 49,124,191
414,329 27,801,706
446,342 7,101,556
414,753
113,364,005
7,302 7,497,596
7,504,898
7,593,819 90,408,065
7,857,223
105,859,107

40 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FOR FISCAL YEAR ENDED JUNE 30, 2017

ADDITIONS Contributions Employer Plan member
Investment Income Dividends & Interest Net Appreciation in Investments Reported at Fair Value Less: Investment Expense
Total Additions
DEDUCTIONS Benefits Premium Expense Administrative expense
Total Deductions
Change in Net Position Held in Trust for Pension & Other Employee Benefits
Net Position, Beginning of Year

Early Retirement Plan - Augusta
University

Deferred Compensation
Fund

Retiree Health Benefit Fund

Total

$

13,084,672 $

--

744,383 $ 266,666

99,583,903 $ --

113,412,958 266,666

1,607,191
9,172,329 (161,162)
23,703,030

192,673
642,097 --
1,845,819

81,140
(2,219) (5,960)
99,656,864

1,881,004
9,812,207 (167,122)
125,205,713

13,617,313 -- --
13,617,313

--

86,008,435

99,625,748

--

3,644,871

3,644,871

--

5,044,837

5,044,837

--

94,698,143

108,315,456

10,085,717 80,322,348

1,845,819 5,748,000

4,958,721 2,898,502

16,890,257 88,968,850

Net Position, End of Year

$

90,408,065 $

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

7,593,819 $

7,857,223 $

105,859,107

2017 Annual Financial Report 41

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017

ASSETS Current Assets Cash & Cash Equivalents Short-term Investments Accounts Receivable, net Federal Financial Assistance Affiliated Organizations Component Units Primary Government Other Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Inventories Prepaid Items Other Assets Total Current Assets

Augusta University Foundation, Inc.

Augusta University Research Institute, Inc.

AU Health System Inc

AU Medical Associates

Georgia Advanced Technology Ventures, Inc.

Georgia College & State University
Foundation

$

544,073 $

8,395,707 $

36,607,910 $

9,752,279 $

4,057,209 $

2,999,196

1,466,910

38,494,241

13,471,819

211,941

5,254,618

505,048

2,061,886

3,652

244,713

18,196

4,150,056 126,458,519

472,380 11,281,308

395,880

281,062

1,051,395

1,151,040

2,146,083

885 3,519,917

13,668,521

19,002,610 16,525,792
-- 241,744,176

538,736 38,729,448

63,802 490,396 5,007,287

29,508 5,459,501

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

4,308,982

69,973

1,107,809

237,174 219,218 7,776,876
25,095,150
522,500 19,539,674
897,307 58,596,881 62,116,798

291,102

95,322,236 201,290

361,075 14,029,596

6,353,031
262,810,454 364,687,011 606,431,187

25,338,392
23,706,252
2,183,441
6,725,011 57,953,096 96,682,544

620,852 15,000
90,674,940 92,418,601 97,425,888

173,804
35,022,134
84,779,839
692,305 15,352,780
3,032,988 139,053,850 144,513,351

DEFERRED OUTFLOWS OF RESOURCES

Deferred Loss on Debt Refunding

Accumulated Decrease in Fair Value of Hedging Instruments

TOTAL DEFERRED OUTFLOWS OF RESOURCES

$

--$

--$

--$

--$

--$

--

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

42 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Contracts Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Augusta University Foundation, Inc.

Augusta University Research Institute, Inc.

AU Health System Inc

AU Medical Associates

Georgia Advanced Technology Ventures, Inc.

Georgia College & State University
Foundation

$

474,559 $

76,753 $

54,936,629 $ 5,796,209

6,379,207 $ 667,623

324,980 $

1,215,376

197,028 113,505
82,445 900,000

5,472,694

2,061,886 500,000
17,911,829

585,165 13,603,248

16,536

8,314,540 3,445,833 5,932,665 3,950,000

1,068,514 865,000

872,253 153,327
163,137 740,435 1,516,529

21,836
1,173,766 3,228,224
-- 273,221 2,365,000

1,767,537

5,565,983

16,893,026 119,742,617

1,950,458 25,119,215

601,341 4,372,002

8,277,423

Non-Current Liabilities Due to Affiliated Organizations Due to Primary Government Due to Other Funds Advances (Including Tuition & Fees) Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Claims & Judgments Other Post Employment Benefits Obligation
Total Non-Current Liabilities TOTAL LIABILITIES

376,000 24,158,605
24,534,605 26,302,142

8,682,920 37,037,500 24,048,493 110,420,000
20,812,794

-- 5,565,983

201,001,707 320,744,324

2,102,916
23,854,028
11,531,792 37,488,736 62,607,951

1,991,522
7,946,303 54,513,018

373,458
94,724,297 846,253
9,643,001

64,450,843 68,822,845

105,587,009 113,864,432

DEFERRED INFLOWS OF RESOURCES
Deferred Funds Received in Advance of Timing Requirements
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

2,130,394

--

--

--

--

--

2,130,394

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)

713,937
18,885,674 16,426,174
(211,129)

-- 69,973 8,393,640

77,975,963
-- -- 207,710,900

6,725,011
-- -- 27,349,582

25,958,655
-- 8,128,464 (5,484,076)

2,386,309
16,001,741 8,560,052 1,570,423

TOTAL NET POSITION

$

35,814,656 $

8,463,613 $ 285,686,863 $

34,074,593 $

28,603,043 $

28,518,525

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

2017 Annual Financial Report 43

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017

ASSETS Current Assets Cash & Cash Equivalents Short-term Investments Accounts Receivable, net Federal Financial Assistance Affiliated Organizations Component Units Primary Government Other Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Inventories Prepaid Items Other Assets Total Current Assets

Georgia Gwinnett College
Foundation, Inc.

Georgia Health Sciences
Foundation, Inc.

Georgia Southern Housing
Foundation, Inc.

Georgia State University
Foundation, Inc.

Georgia State University Research
Foundation Inc. and Affiliates

Georgia Tech Athletic
Association

$

1,673,085 $

263,626 $

2,918,837 $

6,608,614 $

9,340,668 $

6,279,261

10,196,373

5,446,272

4,068 90,236 11,205,484
12,972,873

500,000 4,270,347
58,754 15,289,100

128,732 7,000,900
-- 15,598 15,510,339

8,580,436 7,433,260
506,712 23,129,022

1,864,367 20,597,700
17,271,722 49,074,457

6,186,630
1,159,416 13,625,307

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

7,146,999
282,640 4,066,870 152,530,613
11,314 10,763,142 174,801,578 187,774,451

34,321,466

29,059,109

1,780,440 4,629,129
522,500 2,423,183 9,355,252 24,644,352

191,293,156
--
436,692 226,051,314 241,561,653

11,930,560
100,567,247
133,255,634
3,837,931 118,798,858
15,388,234 412,837,573 435,966,595

8,449,855 72,366,210
9,145,925 89,961,990 139,036,447

5,287,450 105,609,000
728,270 164,857,696 276,482,416 290,107,723

DEFERRED OUTFLOWS OF RESOURCES

Deferred Loss on Debt Refunding

Accumulated Decrease in Fair Value of Hedging Instruments

TOTAL DEFERRED OUTFLOWS OF RESOURCES

$

--$

--$

-- --$

8,774,458

18,624,539

--$

8,774,458 $

18,624,539

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

44 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Contracts Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Georgia Gwinnett College
Foundation, Inc.

Georgia Health Sciences
Foundation, Inc.

Georgia Southern Housing
Foundation, Inc.

Georgia State University
Foundation, Inc.

Georgia State University Research
Foundation Inc. and Affiliates

Georgia Tech Athletic
Association

$

1,340,599 $

125,769 $

5,630,355 $

4,430,861 $

1,939,055 $

5,470,497

41,214 500,000
111,586 1,800,000 3,741,162
7,534,561

9,195 62,440 1,541,873
3,058 789,686
90,485

532,799 7,443,201

16,079,406
2,281,025 802,593
584,500 6,085,000

22,139,877

508,993 15,279,004
943,965 73,133
1,105,000

2,622,506

13,606,355

30,263,385

24,078,932

1,575,564 24,956,156

Non-Current Liabilities Due to Affiliated Organizations Due to Primary Government Due to Other Funds Advances (Including Tuition & Fees) Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Claims & Judgments Other Post Employment Benefits Obligation
Total Non-Current Liabilities TOTAL LIABILITIES

2,262,728 171,236,654
173,499,382 181,033,943

203,461
203,461 2,825,967

3,096,400 4,911,828 194,670,669
202,678,897 216,285,252

1,297,669 6,346,539
617,900 129,003,422
1,690,023 10,881,060
149,836,613 180,099,998

81,500,392
81,500,392 105,579,324

5,082,536 120,902
216,583,039
650,740
222,437,217 247,393,373

DEFERRED INFLOWS OF RESOURCES
Deferred Funds Received in Advance of Timing Requirements
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

17,264,201

--

--

--

--

17,264,201

--

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)

8,388,828
1,261,066 1,028,428 (3,937,814)

2,423,183 15,336,006
4,059,196

436,692
-- 27,093,978 (2,254,269)

15,388,234
128,335,053 88,583,822 23,559,488

9,145,925
-- 7,036,458 8,784,997

(40,529,669)
38,323,155 57,810,372
5,735,031

TOTAL NET POSITION

$

6,740,508 $

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

21,818,385 $

25,276,401 $ 255,866,597 $

24,967,380 $

61,338,889

2017 Annual Financial Report 45

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017

ASSETS Current Assets Cash & Cash Equivalents Short-term Investments Accounts Receivable, net Federal Financial Assistance Affiliated Organizations Component Units Primary Government Other Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Inventories Prepaid Items Other Assets Total Current Assets

Georgia Tech Facilities, Inc.

Georgia Tech Foundation, Inc.

Georgia Tech Research Corporation

Kennesaw State University Athletic Association, Inc.

Kennesaw State University
Foundation, Inc.

Medical College of Georgia Foundation

$

6,002,122 $

5,484,000 $

98,364,276 $

4,279,617 $

21,866,638 $

2,530,713

704,673

600,000 9,018,038
255,892 16,580,725

19,112,000 6,613,160
31,209,160

118,550,521
327,503 71,617
217,313,917

1,305,946 385,924
242,980 71,777 4,615
6,290,859

228,492 2,033,304 8,684,557
225,364 33,038,355

166,242
-- 2,696,955

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

3,794,047 6,771,775
1,104,314 225,470,210
3,681,250 4,569,199 245,390,795 261,971,520

10,857,000
105,211,000
913,577,000
117,218,159
24,857,681 621,400,000 112,110,000 1,905,230,840 1,936,440,000

3 128
4,466,472
1,223,076 5,689,679 223,003,596

49,890,104

2,217,604 2,217,604 8,508,463

3,107,937
17,982,990
229,550,273
33,172,960 92,002,158 425,706,422 458,744,777

972,567 16,588
108,479,442
300,291 127,714,592
5,487,039 242,970,519 245,667,474

DEFERRED OUTFLOWS OF RESOURCES

Deferred Loss on Debt Refunding

Accumulated Decrease in Fair Value of Hedging Instruments

TOTAL DEFERRED OUTFLOWS OF RESOURCES

$

--$

--$

--$

--$

--$

--

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

46 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Contracts Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Georgia Tech Facilities, Inc.

Georgia Tech Foundation, Inc.

Georgia Tech Research Corporation

Kennesaw State University Athletic Association, Inc.

Kennesaw State University
Foundation, Inc.

Medical College of Georgia Foundation

$

2,053,522 $

9,344,020

$

343,118 $

10,796,151

742,825 9,254,450

176,000

$ 23,784,033
201,855
25,928,644
10,725,000 1,633,328

76,864,935 49,399,271
29,998,329 5,826,913
368,794

1,842,593 676,091
400,000

1,547,715 1,288,440
36,469
$
11,780,000 18,800

27,172 2,309,104

12,050,797

348,623 72,141,503

162,458,242

3,261,802

25,467,575

2,336,276

Non-Current Liabilities Due to Affiliated Organizations Due to Primary Government Due to Other Funds Advances (Including Tuition & Fees) Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Claims & Judgments Other Post Employment Benefits Obligation
Total Non-Current Liabilities TOTAL LIABILITIES

7,002,000

5,000 228,739,517

7,337,469 47,271,356
247,498,000 14,396,672

-- 4,425,181

758,334 788,823

372,553,171 107,336

-- 945,194

228,744,517 240,795,314

323,505,497 395,647,000

4,425,181 166,883,423

1,547,157 4,808,959

372,660,507 398,128,082

945,194 3,281,470

DEFERRED INFLOWS OF RESOURCES
Deferred Funds Received in Advance of Timing Requirements
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

--

--

--

--

--

--

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)

4,569,215
-- 8,251,952 8,355,039

47,569,500
693,105,000 726,967,000
73,151,500

1,223,076
-- -- 54,897,097

1,028,781
-- 819,542 1,851,181

(33,985,324)
36,388,593 17,129,008 41,084,418

3,177,935
127,714,592 77,800,657 33,692,820

TOTAL NET POSITION

$

21,176,206 $ 1,540,793,000 $

56,120,173 $

3,699,504 $

60,616,695 $ 242,386,004

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

2017 Annual Financial Report 47

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017

ASSETS Current Assets Cash & Cash Equivalents Short-term Investments Accounts Receivable, net Federal Financial Assistance Affiliated Organizations Component Units Primary Government Other Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Inventories Prepaid Items Other Assets Total Current Assets

Middle Georgia State University
Real Estate Foundation, Inc.

University of Georgia Athletic Association, Inc.

University of Georgia
Foundation

University of Georgia Research Foundation, Inc.

University of North Georgia
Real Estate Foundation, Inc.

UWG Real Estate
Foundation, Inc.

$

261,264 $

45,805,638 $

17,685,430 $

36,727,235 $

1,664,635 $

509,355

113,570,412

--

667,842

119,743 1,617,112

27,878 2,457,680

21,652,353

982,712 35,485,994
7,990,341

1,998,119

742,999 49,034,195

381,599 --
153,289,794

227,249 20,382,914 101,796,445

-- -- -- -- 130,673 -- 2,596,987 -- -- 120,336 -- 4,512,631

2,419,019
-- 3,596,216

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

15,381,804 92,178,377
789,332 108,349,513 110,347,632

50,910,910

41,917,388 102,216,384

496,506
274,453,063 325,860,479 374,894,674

14,958,700 819,440,998
24,929,865 1,003,463,335 1,156,753,129

7,828,567
50,174,814 257,115,849
754,033 19,523,537 335,396,800 437,193,245

21,312,956
-- -- -- -- -- 118,405,379 -- -- -- 10,078,248 149,796,583 154,309,214

8,292,308
243,150 116,839,596
125,375,054 128,971,270

DEFERRED OUTFLOWS OF RESOURCES

Deferred Loss on Debt Refunding

11,559,556

16,534,037

--

--

Accumulated Decrease in Fair Value of Hedging

Instruments

3,961,146

--

TOTAL DEFERRED OUTFLOWS OF RESOURCES

$

--$

15,520,702 $

--$

16,534,037 $

--$

--

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

48 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Contracts Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Middle Georgia State University
Real Estate Foundation, Inc.

University of Georgia Athletic Association, Inc.

University of Georgia
Foundation

University of Georgia Research Foundation, Inc.

University of North Georgia
Real Estate Foundation, Inc.

UWG Real Estate
Foundation, Inc.

$

2,309,235 $

6,578,218 $

1,035,038 $

1,888,521 $

3,450,349 $

1,177,979

5,769,216

--

1,096,841

9,337

--

--

5,599,476

3,112,597

40,224,832

--

25,740,505

641,469

2,186,282

2,345,415

22,540,419

--

--

--

--

5,586,136

438,750

--

1,555,000

2,865,000

9,605,000

3,186,453

2,946,721

745,760

--

1,878,813

--

--

--

--

3,864,235

46,552,415

12,999,813

76,454,391

10,517,808

4,124,700

Non-Current Liabilities Due to Affiliated Organizations Due to Primary Government Due to Other Funds Advances (Including Tuition & Fees) Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Claims & Judgments Other Post Employment Benefits Obligation
Total Non-Current Liabilities TOTAL LIABILITIES

773,000 91,242,763

494,297
101,403,529 3,961,146

92,015,763 95,879,998

105,858,972 152,411,387

621,301
11,205,000
8,442,818 628,418
20,897,537 33,897,350

1,769,494 8,516,222 273,632,543
283,918,259 360,372,650

-- -- -- -- -- 1,620,000 -- 133,430,344 -- -- -- -- 135,050,344 145,568,152

121,324,421
121,324,421 125,449,121

DEFERRED INFLOWS OF RESOURCES
Deferred Funds Received in Advance of Timing Requirements
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

--

--

--

--

--

--

--

--

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)

1,014,058
-- 13,131,605
321,971

181,744,090
-- -- 56,259,899

8,138,729
539,734,884 461,685,019 113,297,147

11,007,315
-- 2,063,519 80,283,798

2,861,423
-- -- 5,879,639

-- -- 3,522,149

TOTAL NET POSITION

$

14,467,634 $ 238,003,989 $ 1,122,855,779 $

93,354,632 $

8,741,062 $

3,522,149

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

2017 Annual Financial Report 49

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017
ASSETS Current Assets Cash & Cash Equivalents Short-term Investments Accounts Receivable, net Federal Financial Assistance Affiliated Organizations Component Units Primary Government Other Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES
The notes to the financial statements are an integral part of this statement.

University System of Georgia
Foundation, Inc. and Affiliates

VSU Auxiliary Services Real Estate Foundation

Elimination/ Consolidation
Entries

Total

$

413,374 $

2,722,247

33,096 3,952,636
4,399,106

$
686,725 3,623,144
13,817 7,045,933

--$ --

333,757,009 183,313,869

-- 27,878 (527,878)
-- -- -- -- -- -- -- -- (500,000)

5,254,618 3,515,078
-- 9,026,217 379,329,818
600,000 76,503,156
327,503 19,245,590 37,774,863 21,384,637 1,070,032,358

14,160,197

9,144,179

5,436,309 253,470,637
890
273,068,033 277,467,139

168,513,203
227,338 177,884,720 184,930,653

--
-- -- -- -- -- -- -- -- -- -- -- (500,000)

201,293,696
6,771,775 171,521,812
235,809 1,651,490,772
1,305,604 2,261,788,537
4,466,472 59,900,643 1,757,843,045 1,112,342,848 7,228,961,013 8,298,993,371

--

--

55,492,590

--

--

3,961,146

$

--$

--$

--$

59,453,736

50 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF NET POSITION COMPONENT UNITS JUNE 30, 2017
LIABILITIES Current Liabilities Accounts Payable Salaries Payable Contracts Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities
Non-Current Liabilities Due to Affiliated Organizations Due to Primary Government Due to Other Funds Advances (Including Tuition & Fees) Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Claims & Judgments Other Post Employment Benefits Obligation
Total Non-Current Liabilities TOTAL LIABILITIES
DEFERRED INFLOWS OF RESOURCES Deferred Funds Received in Advance of Timing Requirements Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION
The notes to the financial statements are an integral part of this statement.

University System of Georgia
Foundation, Inc. and Affiliates

VSU Auxiliary Services Real Estate Foundation

Elimination/ Consolidation
Entries

Total

$

677,064 $

1,894,883

$

890

4,975,000

3,035,000

5,652,954

4,929,883

--$ -- -- -- (500,000) -- -- -- -- -- -- -- -- -- -- -- -- -- (500,000)

123,892,738 12,233,048 1,096,841 3,060,447 --
189,069,754 127,480,622
38,211,074 35,508,468 16,304,908 40,967,360
8,475,621 84,440,825
2,488,373 5,619,975
601,341 1,575,564 19,192,107 710,219,066

39,595,688 230,763,309

--
167,191,153 6,310,954

270,358,997 276,011,951

173,502,107 178,431,990

-- -- -- -- -- -- -- -- -- -- -- -- -- (500,000)

7,002,000 3,096,400
621,301 5,822,019 29,875,969 162,848,614 83,725,494 3,013,929,856 26,631,757 52,237,373
650,740 11,531,792 3,397,973,315 4,108,192,381

--

17,264,201

--

--

2,130,394

--

--

--

19,394,595

227,338

349,987 527,494 577,707

-- -- 6,271,325

$

1,455,188 $

6,498,663 $

--

335,166,021

--

1,602,522,928

--

1,538,449,523

--

754,721,659

-- $ 4,230,860,131

2017 Annual Financial Report 51

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts & Contributions Endowment Income Other Operating Revenues

Augusta University Foundation,
Inc.

Augusta University Research Institute, Inc.

AU Health System Inc

AU Medical Associates

Georgia Advanced Technology Ventures, Inc.

Georgia College & State
University Foundation

$ 50,742,878

$ 1,615,076

$

453,808

1,276,274

9,547,201
478,227 --

$ 31,962,778 250,102 --
1,941,197 612,613,382

$
81,403 --

29,595 166,999 12,750,573 $

6,455,162

140,467,104

1,108,608 1,023,803
16,966

427,596 3,253

1,812,948 3,244,705
123,712

Total Operating Revenues

3,879,459

60,768,306

646,767,459

142,163,583

13,378,016

11,636,527

OPERATING EXPENSES Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation

1,051,168
1,059,977 16,122

60,496,796

248,460,099 54,263,244 78,804,212 813,662
3,982,641 265,946,995
33,593,642

29,489,419 27,193,176 89,452,222
2,393,843 169,172 98,365
13,319,265 781,266

57,190
39,500 6,011,245 2,604,228

687,008
71,072 744,748
87,198 2,638,718
105,872

Total Operating Expenses

2,127,267

60,496,796

685,864,495

162,896,728

8,712,163

4,334,616

Operating Income (Loss)

$ 1,752,192 $

271,510 $ (39,097,036) $ (20,733,145) $ 4,665,853 $ 7,301,911

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

52 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Augusta University Foundation,
Inc.

Augusta University Research Institute, Inc.

AU Health System Inc

AU Medical Associates

Georgia Advanced Technology Ventures, Inc.

Georgia College & State
University Foundation

$ 31,409,501

2,967,388 3,178,581
741

$ 1,912,775 $ (997,521) (271,369)

55,228 (99,563)

4,114,965 $ 2,106,759 $

2,307,576

(788,272)

359,819

(25,075,751)

19,821 $ (3,410,537)

6,148,739 (4,192,793)

Net Nonoperating Revenues

643,885

(44,335)

44,338,571

(23,757,264)

(3,390,716)

1,955,946

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

2,396,077

227,175

5,241,535

(44,490,409)

1,275,137

9,257,857

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item Extraordinary Item

741,239

88,747 1,955,837

1,000,000 2,000,000

1,904,607

Total Other Revenues, Expenses, Gains or Losses

741,239

--

2,044,584

--

3,000,000

1,904,607

Change in Net Position Net Position, Beginning of Year, Restated

3,137,316 32,677,340

227,175 8,236,438

7,286,119 278,400,744

(44,490,409) 78,565,002

4,275,137 24,327,906

11,162,464 17,356,061

Net Position, End of Year

$ 35,814,656 $ 8,463,613 $ 285,686,863 $ 34,074,593 $ 28,603,043 $ 28,518,525

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

2017 Annual Financial Report 53

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts & Contributions Endowment Income Other Operating Revenues

Georgia Gwinnett College Foundation,
Inc.

Georgia Health Sciences
Foundation, Inc.

Georgia Southern Housing Foundation,
Inc.

Georgia State University Foundation, Inc.

Georgia State University Research
Foundation Inc. and Affiliates

Georgia Tech Athletic
Association

$

$

79,006

11,575,854

405,857 922,460
12,300 $

10,543,159 $

$ 20,163,192

74,446,010 1,069,375
17,863,149 $
129,335 --

56,864,958 9,591,533 --

1,324,289 378,000

1,356,302 1,595,639

1,740,776

27,097,797 5,747,888 (7,446,971)

2,835,187

4,122,330

Total Operating Revenues

13,357,149

4,292,558

12,283,935

45,561,906

96,343,056

70,578,821

OPERATING EXPENSES Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation

251,913
1,544,717 82,597

987,036 134,746 1,096,559
6,037,878

201,703 1,384,424

1,204,375 7,237,984
36,232,588 591,008

97,054
6,328 92,696,632
653,811

6,319,413 11,071,266
47,327,899 7,587,218

Total Operating Expenses

1,879,227

8,256,219

1,586,127

45,265,955

93,453,825

72,305,796

Operating Income (Loss)

$ 11,477,922 $ (3,963,661) $ 10,697,808 $

295,951 $ 2,889,231 $ (1,726,975)

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

54 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Georgia Gwinnett College Foundation,
Inc.

Georgia Health Sciences
Foundation, Inc.

Georgia Southern Housing Foundation,
Inc.

Georgia State University Foundation, Inc.

Georgia State University Research
Foundation Inc. and Affiliates

Georgia Tech Athletic
Association

$ 1,498,018 $ (7,515,725)

342,379 $ (26,021)

752,945 $ (8,877,741)

$ 8,358,721 (1,696,322)

(80,935) 605,029 $ (2,819,904) 633,791

12,428,554 (12,592,465)
(1,149,375)

Net Nonoperating Revenues

(6,017,707)

316,358

(8,124,796)

6,662,399

(1,662,019)

(1,313,286)

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

5,460,215

(3,647,303)

2,573,012

6,958,350

1,227,212

(3,040,261)

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item Extraordinary Item

(48,975)

355,219

12,542,959

1,969,742

Total Other Revenues, Expenses, Gains or Losses

(48,975)

355,219

--

12,542,959

--

1,969,742

Change in Net Position Net Position, Beginning of Year, Restated

5,411,240 1,329,268

(3,292,084) 25,110,469

2,573,012 22,703,389

19,501,309 236,365,288

1,227,212 23,740,168

(1,070,519) 62,409,408

Net Position, End of Year

$ 6,740,508 $ 21,818,385 $ 25,276,401 $ 255,866,597 $ 24,967,380 $ 61,338,889

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

2017 Annual Financial Report 55

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts & Contributions Endowment Income Other Operating Revenues

Georgia Tech Facilities, Inc.

Georgia Tech Foundation,
Inc.

Georgia Tech Research Corporation

Kennesaw State
University Athletic
Association, Inc.

Kennesaw State
University Foundation,
Inc.

Medical College of Georgia Foundation

$ 583,812,699

7,573,630

$ 1,980,000

90,628,106

8,784 $

21,000

$

14,661,626

25,570,000

11,888,231

--

5,686,095 $

532,957

41,124,292 $

1,458,843

47,181,000

4,707,755 14,955,975

3,312,047 1,204,044 9,948,612

2,406,967 27,069

Total Operating Revenues

16,650,410

72,772,000

693,902,666

25,349,825

56,121,952

3,892,879

OPERATING EXPENSES Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation

193,750 749,134
60,000

3,403,000 529,000 72,000 92,000
512,000 104,195,000
4,352,000

127,858
690,277,098 340,865

7,270,002
2,394,864 5,451,689 8,381,848
436,626

3,607,058
36,014 25,375
3,041,028 17,241,864
5,114,391

848,864 127,613
4,367 1,845,941
26,524 6,847,271
19,502

Total Operating Expenses

1,002,884

113,155,000

690,745,821

23,935,029

29,065,730

9,720,082

Operating Income (Loss)

$ 15,647,526 $ (40,383,000) $ 3,156,845 $ 1,414,796 $ 27,056,222 $ (5,827,203)

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

56 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Georgia Tech Facilities, Inc.

Georgia Tech Foundation,
Inc.

Georgia Tech Research Corporation

Kennesaw State
University Athletic
Association, Inc.

Kennesaw State
University Foundation,
Inc.

Medical College of Georgia Foundation

$

123,965 $ 185,908,000 $

(12,905,063)

(12,380,000)

422,189 $
370,702

$ 2,649,294 $ 27,183,044

(32,529)

(15,273,484)

Net Nonoperating Revenues

(12,781,098) 173,528,000

792,891

(32,529)

(12,624,190)

27,183,044

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

2,866,428

133,145,000

3,949,736

1,382,267

14,432,032

21,355,841

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item Extraordinary Item

39,717,000

940,155 (3,324,141)

1,988,107

Total Other Revenues, Expenses, Gains or Losses

--

39,717,000

--

--

(2,383,986)

1,988,107

Change in Net Position Net Position, Beginning of Year, Restated

2,866,428 18,309,778

172,862,000 1,367,931,000

3,949,736 52,170,437

1,382,267 2,317,237

12,048,046 48,568,649

23,343,948 219,042,056

Net Position, End of Year

$ 21,176,206 $ 1,540,793,000 $ 56,120,173 $ 3,699,504 $ 60,616,695 $ 242,386,004

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

2017 Annual Financial Report 57

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts & Contributions Endowment Income Other Operating Revenues

Middle Georgia State
University Real Estate
Foundation, Inc.

University of Georgia Athletic
Association, Inc.

University of Georgia
Foundation

University of Georgia Research
Foundation, Inc.

University of North Georgia
Real Estate Foundation,
Inc.

UWG Real Estate
Foundation, Inc.

--

--

$ 182,409,293

--

$ 8,489,747

$

38,400

$ 5,163,607

1,087,217

27,574,536

8,009,644 $ 6,455,564

--

--

--

--

--

$ 130,318,885

--

55,337,232

151,602

--

--

--

Total Operating Revenues

5,163,607

130,318,885

64,914,196

209,983,829

8,199,646

6,455,564

OPERATING EXPENSES Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation

220,980

11,911,586 360,884
10,608,328
91,703,657 8,991,206

441,568

902,749 63,000
77,618,273 1,320,150

194,300,429 115,077

-- -- -- -- -- -- 700,321 116,941

717,800

Total Operating Expenses

220,980

123,575,661

80,345,740

194,415,506

817,262

717,800

Operating Income (Loss)

$ 4,942,627 $ 6,743,224 $ (15,431,544) $ 15,568,323 $ 7,382,384 $ 5,737,764

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

58 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Middle Georgia State
University Real Estate
Foundation, Inc.

University of Georgia Athletic
Association, Inc.

University of Georgia
Foundation

University of Georgia Research
Foundation, Inc.

University of North Georgia
Real Estate Foundation,
Inc.

UWG Real Estate
Foundation, Inc.

$

--

--

--

--

$ 22,000,000

--

$

266,400

3,844,105 $ 106,844,666 $ 3,231,309 $

304,035 $

117,849

(4,584,391)

(2,396,646)

1,766,237

(12,388,604)

(6,373,418)

(5,144,156)

2,250

(58,320)

(197,514)

--

Net Nonoperating Revenues

(4,315,741)

23,389,139

108,610,903

(9,354,809)

(6,069,383)

(5,026,307)

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

626,886

30,132,363

93,179,359

6,213,514

1,313,001

711,457

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item Extraordinary Item

53,483,214

-- -- -- -- (1,217,245) --

Total Other Revenues, Expenses, Gains or Losses

--

--

53,483,214

--

(1,217,245)

--

Change in Net Position Net Position, Beginning of Year, Restated

626,886 13,840,748

30,132,363 207,871,626

146,662,573 976,193,206

6,213,514 87,141,118

95,756 8,645,306

711,457 2,810,692

Net Position, End of Year

$ 14,467,634 $ 238,003,989 $ 1,122,855,779 $ 93,354,632 $ 8,741,062 $ 3,522,149

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

2017 Annual Financial Report 59

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
The notes to the financial statements are an integral part of this statement.

University System of Georgia Foundation, Inc. and Affiliates

VSU Auxiliary Services Real
Estate Foundation

Elimination/ Consolidation
Entries

Total

$

586,393

15,160,170 $

7,631,810

1,397,572 21,479
17,165,614

3,860,094 954,491
12,446,395

$ 710,616,663 8,643,005
302,863,201 105,813,385 239,092,654
1,941,197 753,080,486 130,318,885 155,604,139
11,241,919 25,132,709
2,444,348,243

93,932

59,325 1,578,671
1,855,931

621,492

3,493,927

715,424

$ 13,671,687 $ 11,730,971

306,269,726 82,473,917
169,553,187 25,249,031 30,562,111 7,987,334
1,730,128,232 66,882,522
2,419,106,060
$ 25,242,183

60 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION COMPONENT UNITS FOR FISCAL YEAR ENDED JUNE 30, 2017

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues

University System of Georgia Foundation, Inc. and Affiliates

VSU Auxiliary Services Real
Estate Foundation

Elimination/ Consolidation
Entries

Total

$ 31,409,501

$

566,478 $

(12,553,448)

38,170 (7,575,758) (8,318,529)

2,967,388 3,178,581
741 21,919,065 369,843,437 (130,450,985) (33,803,859)

(11,986,970)

(15,856,117)

265,063,869

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item Extraordinary Item

1,684,717

(4,125,146)

104,678

290,306,052
88,747 1,000,000 3,955,837 112,757,790 (277,090) (3,324,141)

Total Other Revenues, Expenses, Gains or Losses
Change in Net Position Net Position, Beginning of Year, Restated
Net Position, End of Year The notes to the financial statements are an integral part of this statement.

104,678

--

1,789,395 (334,207)

(4,125,146) 10,623,809

$ 1,455,188 $ 6,498,663

114,201,143
404,507,195 3,826,352,936
$ 4,230,860,131

2017 Annual Financial Report 61

62 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 2017
Note 1 Summary of Significant Accounting Policies
Nature of Operations The University System of Georgia (USG) serves the state and national communities by providing its students with academic instruction that advances fundamental knowledge and by disseminating knowledge to the people of Georgia, the nation, and throughout the world.
Reporting Entity The USG, an organizational unit of the State of Georgia primary government (State), is comprised of twenty-eight (28) State-supported member institutions of higher education in Georgia, the University System Office (USO), the Georgia Archives and the Georgia Public Library System. The USO also is the custodian of the Board of Regents Retiree Health Benefit Fund and the Deferred Compensation Plan. Augusta University, an organizational unit of the USG, is the custodian of the Early Retirement Plan.
The Board of Regents of the University System of Georgia (Board) has constitutional authority to govern, control and manage the USG. The Board was created in 1931 as a part of a reorganization of Georgia's state government. With this act, public higher education in Georgia was unified for the first time under a single governing and management authority. The governor appoints members to the Board, who each serve seven years; regents may be reappointed to subsequent terms by a sitting governor. Regents donate their time and expertise to serve the State through their governance of the USG - the positions are voluntary ones without financial remuneration. Today, the Board is composed of 19 members, five of whom are appointed from the state-at-large, and one from each of the 14 congressional districts. The Board elects a chancellor who serves as its chief executive officer and the chief administrative officer of the USG.
The USG does not have the right to sue/be sued without recourse to the State. The USG's property is the property of the State and subject to all the limitations and restrictions imposed upon other property of the State by the Constitution and laws of the State. In addition, the USG is not legally separate from the State. Accordingly, the USG is included within the State's basic financial statements as part of the primary government as defined in Section 2100 of the Governmental Accounting Standards Board (GASB) Codification of Governmental Accounting and Financial Reporting Standards.
The accompanying basic financial statements are intended to supplement the State's Comprehensive Annual Financial Report (CAFR) by presenting the financial position and changes in financial position and cash flows of only that portion of the business-type activities of the State that is attributable to the transactions of the USG. In addition, certain discretely presented component units of the State, as discussed below, have been included since they have been determined to be essential to the fair presentation to these departmental financial statements. These financial statements do not purport to, and do not, present fairly the financial position of the State as of June 30, 2017, the changes in its financial position or its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
The accompanying basic financial statements should be read in conjunction with the State's CAFR. The most recent State of Georgia CAFR can be obtained through the State Accounting Office, 200 Piedmont Avenue, Suite 1604 (West Tower), Atlanta, Georgia 30334 or online at sao.georgia.gov/comprehensive-annual-financial-reports.
Discretely Presented Component Units The below organizations are legally separate, tax-exempt component units of the State. Although the State (primary government) is not fiscally accountable for these entities, it has been determined that the nature and significance of the relationship between the primary government and the below organizations is such that exclusion from these departmental financial statements would render them misleading. The below organizations met the requirements for discrete presentation as defined by GASB Codification Sections 2100 and 2600. Each of the below organization's fiscal year ends on June 30 each year, except for VSU Auxiliary Services Real Estate Foundation, Inc. VSU Auxiliary Services Real Estate Foundation, Inc.'s fiscal year ends December 31 each year. Separately issued financial statements are available from the following addresses.
64 University System of Georgia

Augusta University Foundation, Inc. 1120 15th Street, FI-1049, Augusta, GA, 30912
Augusta University Research Institute, Inc. 1120 15th Street, AA 311, Richmond, Augusta, GA, 30912
AU Health Systems, Inc. d/b/a AU Health System, 1120 15th Street. FY139, Augusta, GA 30912
AU Medical Associates & Subsidiaries, 1499 Walton Way, Ste. 1400, Augusta, GA 30901
Georgia Advanced Technology Ventures Inc. - 221 Uncle Heinie Way, Lyman Hall Suite 325, Atlanta, GA, 30332-0257 or found at gatv.gatech.edu/financial-statements.
Georgia College & State University Foundation, Inc., 231 W Hancock St., CBX 96, Milledgeville, GA, 30161.
Georgia Gwinnett College Foundation, Inc., 1000 University Center Lane, Lawrenceville, GA, 30043.
Georgia Southern University Housing Foundation, Inc., P.O. Box 8020, Statesboro, GA 30460
Georgia State University Foundation, Inc., Attn: Dale Parmer, GSU Foundation, 533 One Park Place, Atlanta, GA 30301-2668.
Georgia State University Research Foundation, Inc., 100 Auburn Avenue, Suite 315, Fulton, Atlanta, GA, 30303
Georgia Health Sciences Foundation, Inc., 1120 15th Street, Augusta, Georgia 30912
Georgia Tech Athletic Association - 150 Bobby Dodd Way, NW, Atlanta, GA 30332-0455 or found at finservices.gatech.edu/affiliated-organization-financial-statements.
Georgia Tech Facilities Inc. - 221 Uncle Heinie Way, NW, Lyman Hall Suite 325, Atlanta GA 30332-0257 or found at gtfi.gatech.edu/financial-statements.
Georgia Tech Foundation Inc. - 760 Spring Street, NW, Suite 400, Atlanta, GA 30308 or found at gtf.gatech.edu/ financial-statements.
Georgia Tech Research Corporation - 505 10th Street, Atlanta, GA 30332-0415 or found at gtrc.gatech.edu/ financial-information.
Kennesaw State University Athletic Association, Inc., 590 Cobb Avenue MD# 0201, Cobb, Kennesaw, GA, 30144
Kennesaw State University Foundation, Inc., 3391 Town Point Drive, Suite 4530/Mail drop 9101, Kennesaw, GA 30144.
Medical College of Georgia Foundation, 545 15th Street, Augusta, GA 30901
Middle Georgia State University Real Estate Foundation, Inc., 100 University Pkwy, Macon, GA 31206
University of Georgia Athletic Association, Inc., 456 E. Broad Street, Athens, GA 30602
University of Georgia Foundation, 394 S. Milledge Ave, Suite 100, Athens, GA 30602
University of Georgia Research Foundation, Inc., 324 Business Services Building, 456 E. Broad Street, Athens, GA 30602
University of North Georgia Real Estate Foundation, Inc., 110 South Chestatee Street, Suite 320, Dahlonega, GA 30597
University System of Georgia Foundation, Inc., 270 Washington Street, SW Suite 7007, Atlanta, Ga 30334
2017 Annual Financial Report 65

VSU Auxiliary Services Real Estate Foundation, Inc., 1500 N. Patterson St, Valdosta, GA 31698
UWG Real Estate Foundation, Inc., 1601 Maple St, Carrollton, GA 30118
See Component Unit Note for additional information related to discretely presented component units.
Basis of Accounting and Financial Statement Presentation The financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) as prescribed by the GASB and are presented as required by these standards to provide a comprehensive, entity-wide perspective of the USG's assets, deferred outflows, liabilities, deferred inflows, net position, revenues, expenses, changes in net position and cash flows.
The USG's business-type activities and fiduciary fund financial statements have been presented using the economic resources measurement focus and the accrual basis of accounting. Under the accrual basis, revenues are recognized when earned, and expenses are recorded when an obligation has been incurred. Grants and similar items are recognized as revenues in the fiscal year in which eligibility requirements imposed by the provider have been met. All significant intra-fund transactions have been eliminated.
The USG reports the following Fiduciary Funds:
Pension and Other Post-Employee Benefit Trust Funds - Accounts for the activities of the Early Retirement Plan, the Board of Regents Retiree Health Benefit Fund and the Deferred Compensation Fund.
New Accounting Pronouncements For fiscal year 2017, the USG adopted GASB Statement No. 82, Pension Issues-an amendment of GASB Statements No. 67, No. 68, and No. 73. This Statement addresses accounting and financial reporting issues regarding (1) the presentation of payroll-related measures in required supplementary information, (2) the selection of assumptions and the treatment of deviations from the guidance in an Actuarial Standard of Practice for financial reporting purposes, and (3) the classification of payments made by employers to satisfy employee (plan member) contribution requirements.
For fiscal year 2017, the USG adopted GASB Statement No. 80, Blending Requirements for Certain Component Unitsan amendment of GASB Statement No. 14. This Statement amends the blending requirements for the financial statement presentation of component units of all state and local governments. The additional criterion requires blending of a component unit incorporated as a not-for-profit corporation in which the primary government is the sole corporate member. The additional criterion does not apply to component units included in the financial reporting entity pursuant to the provisions of GASB Statement No. 39, Determining Whether Certain Organizations Are Component Units. The adoption of this Statement does not have a significant impact on the USG's financial statements.
For fiscal year 2017, the USG adopted GASB Statement No. 78, Pensions Provided through Certain Multiple-Employer Defined Benefit Pension Plans. The objective of this Statement is to address a practice issue regarding the scope and applicability of GASB Statement No. 68, Accounting and Financial Reporting for Pensions. The adoption of this Statement does not have a significant impact on the USG's financial statements.
For fiscal year 2017, the USG adopted GASB Statement No. 77, Tax Abatement Disclosures. This Statement requires governments that enter into tax abatement agreements to disclose certain information about the agreements. The adoption of this Statement does not have a significant impact on the USG's financial statements.
For fiscal year 2017, the USG adopted GASB Statement No. 74, Financial Reporting for Post Employment Benefit Plans Other Than Pension Plans. This Statement replaces GASB Statements No. 43, Financial Reporting for Post Employment Benefit Plans Other Than Pension Plans, as amended, and No. 57, OPEB Measurements by Agent Employers and Agent Multiple-Employer Plans. It also includes requirements for defined contribution other post employment benefit (OPEB) plans that replace the requirements for those OPEB plans in GASB Statements No. 25, Financial Reporting for Defined Benefit Pension Plans and Note Disclosures for Defined Contribution Plans, as amended, No. 43, and No. 50, Pension Disclosures. The objective of this Statement is to improve the usefulness of information about post employment benefits other than pensions. The adoption of this Statement does not have a significant impact on the USG's financial statements.
66 University System of Georgia

Future Accounting Pronouncements In fiscal year 2018, the USG will adopt GASB Statement No. 75, Accounting and Financial Reporting for Post Employment Benefits Other Than Pensions. The provisions of this Statement establish accounting and financial reporting standards for defined benefit OPEB and defined contribution OPEB that are provided to the employees of state and local governmental employers through OPEB plans that are administered through trusts or equivalent arrangements. Implementation of this Statement will require the USG to record a liability for its proportionate share of the OPEB Liability of plans in which it participates. Actuarial estimates are currently being made to determine the USG's liability, the effects of which are believed to be material.
Cash and Cash Equivalents Cash and Cash Equivalents consist of petty cash, demand deposits and time deposits in authorized financial institutions, and cash management pools that have the general characteristics of demand deposit accounts. This includes the State Investment Pool (Georgia Fund 1) and the Board of Regents Short-Term Investment Pool.
Short-Term Investments Short-Term Investments consist of investments of 90 days - 13 months. These include certificates of deposits or other time-restricted investments with original maturities of six months or more when purchased. Funds are not readily available and there is a penalty for early withdrawal.
Investments Investments include financial instruments with terms in excess of 13 months, certain other securities for the production of revenue, land, and other real estate held as investments by endowments. The USG accounts for its investments at fair value. Changes in unrealized gain (loss) on the carrying value of investments are reported as a component of investment income in the Statement of Revenues, Expenses, and Changes in Net Position. The Board of Regents Legal Fund, the Board of Regents Balanced Income Fund, the Board of Regents Total Return Fund, the Board of Regents Diversified Fund, the Board of Regents Diversified Fund for Foundations and the Georgia Extended Asset Pool are included as investments.
Accounts Receivable Accounts receivable consists of tuition and fees charged to students and auxiliary enterprise services provided to students, faculty and staff, the majority of whom reside in the State of Georgia. Accounts receivable also includes amounts due from federal, state and local governments, or private sources, in connection with reimbursement of allowable expenditures made pursuant to the USG's grants and contracts. Accounts receivable are recorded net of estimated uncollectible amounts.
Inventories Consumable supplies are carried at the lower of cost or market on the first-in, first-out ("FIFO") basis. Resale inventories are valued at cost using the average-cost basis.
Non-current Cash and Cash Equivalents Cash and cash equivalents that are externally restricted and cannot be used to pay current liabilities are classified as non-current assets in the Statement of Net Position.
Non-current Investments Investments that cannot be used to pay current liabilities are classified as non-current assets in the Statement of Net Position.
Prepaid Items Payments made to vendors and state and local government organizations for services that will benefit periods beyond June 30, 2017 are recorded as prepaid items.
Capital Assets Capital assets are recorded at cost at the date of acquisition, or fair market value at the date of donation in the case of gifts. For equipment, the USG's capitalization policy includes all items with a unit cost of $5,000 or more, and an estimated useful life of greater than one year. Renovations to buildings, infrastructure, and land improvements that exceed $100,000 and/or significantly increase the value or extend the useful life of the structure are capitalized. Routine repairs and maintenance are charged to operating expense in the year in which the expense was incurred.
2017 Annual Financial Report 67

Depreciation, which also includes amortization of intangible assets such as water, timber, and mineral rights, easements, patents, trademarks, and copyrights, as well as software, is computed using the straight-line method over the estimated useful lives of the assets, generally 40 to 60 years for buildings, 20 to 25 years for infrastructure and land improvements, 10 years for library books, and 3 to 20 years for equipment. Residual values will generally be 10% of historical costs for infrastructure, buildings and building improvements, and facilities and other improvements.
To fully understand plant additions in the USG, it is necessary to look at the activities of the Georgia State Financing and Investment Commission (GSFIC) - an organization that is external to the System. GSFIC issues bonds for and on behalf of the State of Georgia, pursuant to powers granted to it in the Constitution of the State of Georgia and the Act creating the GSFIC. The bonds so issued constitute direct and general obligations of the State of Georgia, to the payment of which the full faith, credit and taxing power of the State are pledged.
For projects managed by GSFIC, GSFIC retains construction in progress in its accounting records throughout the construction period and transfers the entire project to the institutional unit of the University System when complete. For projects managed by institutions of the USG, the institutions retain construction in progress on their books and are reimbursed by GSFIC.
Capital Liability Reserve Fund The Capital Liability Reserve Fund (Fund) was established by the Board of Regents to protect the fiscal integrity of the USG to maintain the strongest possible credit ratings associated with Public Private Venture (PPV) projects and to ensure that the Board of Regents can effectively support its long-term capital lease obligations. All USG institutions participating in the PPV program finance the Fund. The Fund serves as a pooled reserve that is managed by the Board of Regents. The Fund shall only be used to address significant shortfalls and only insofar as a requesting USG institution is unable to make the required PPV capital lease payment to the designated affiliated organization. The Fund will continue as long as the Board of Regents has rental obligations under the PPV program and at the conclusion of the program, funds will be returned to each institution. See Note 10 for additional information.
Deferred Outflows of Resources Deferred outflows of resources consist of the consumption of net position that is applicable to a future reporting period.
Deposits Deposits represent good faith deposits from students to reserve housing assignments, meal plans or other auxiliary services.
Advances Advances include amounts received for tuition and fees and certain auxiliary activities prior to the end of the fiscal year but related to the subsequent accounting period. Advances also include amounts received from grant and contract sponsors that have not yet been earned.
Deposits Held for Other Organizations Deposits held for other organizations result primarily from the USG acting as an agent or fiduciary, for another entity. Deposits held for others include scholarships, fellowships, study abroad deposits and other funds held for various governments, companies, clubs or individuals.
Claims and Judgments An estimated loss from claims and judgments is recognized when information available prior to issuance of the financial statements indicates it is probable that an asset has been impaired or a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated.
Pollution Remediation Obligations Pollution remediation obligations are recorded when the USG knows that a site is polluted and one or more obligating events have occurred. The amount recorded is an estimate of the current value of potential outlays for cleanup, calculated using the "expected cash flows" measurement technique.
68 University System of Georgia

Compensated Absences Employee vacation pay is accrued at the end of the fiscal year for financial statement purposes. The liability and expense incurred are recorded at the end of the fiscal year as compensated absences in the Statement of Net Position, and as a component of compensation and benefit expense in the Statements of Revenues, Expenses, and Changes in Net Position.
Non-current Liabilities Non-current liabilities include: (1) liabilities that will not be paid within the next fiscal year; (2) capital lease obligations with contractual maturities greater than one year; and (3) other liabilities that, although payable within one year, are to be paid from funds that are classified as non-current assets.
Deferred Inflows of Resources Deferred inflows of resources consist of the acquisition of net position that is applicable to a future reporting period.
Net Other Post-Employment Benefit (OPEB) Obligation The net OPEB obligation represents the cumulative difference between the actuarially determined annual required contribution and the amount actually contributed by the USG.
The financial statements of the OPEB plan are prepared using the accrual basis of accounting. Employer contributions are recognized in the period in which they are due. Benefits and refunds are recognized when due and payable in accordance with the terms of the Plan.
Pensions and Net Pension Liability The net pension liability represents the USG's proportionate share of the difference between the total pension liability as a result of the exchange for employee services for compensation and the fiduciary net position or the fair value of the plan assets as of a given measurement date.
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plans' fiduciary net position, additions to/ deductions from the plans fiduciary net position have been determined on the same basis as they are reported by Teachers Retirement System of Georgia and Employees' Retirement System of Georgia. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
Service Concession Arrangements Service concession agreements are arrangements between a government (transferor, one of our institutions) and a third party (operator) in which all of the following criteria are met:
a) The institution conveys to the operator the right and obligation to provide public services through the use and operation of a capital asset in exchange for significant consideration. Significant consideration could be in the form of up front payments, installment payments, a new facility or improvements to existing facility.
b) The operator collects and is compensated by fees from third parties. c) The institution has the ability to modify or approve what services the operator is required to provide, to whom
services are provided, and prices or rates that can be charged for those services. d) The institution is entitled to significant residual interest in the service utility of the asset at the end of the
arrangement.
Net Position The USG's net position is classified as follows:
Net Investment in capital assets represents the USG's total investment in capital assets, net of outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets. The term "debt obligations" as used in this definition does not include debt of the GSFIC as discussed previously in Note 1 - Capital Assets section.
2017 Annual Financial Report 69

Restricted - nonexpendable net position includes endowments and similar type funds in which donors or other outside sources have stipulated, as a condition of the gift instrument, that the principal is to be maintained inviolate and in perpetuity, and invested for the purpose of producing present and future income, which may either be expended or added to principal. For institution-controlled, donor-restricted endowments, the by-laws of the Board of Regents of the University System of Georgia permits each individual institution to use prudent judgment in the spending of current realized and unrealized endowment appreciation. Donor-restricted endowment appreciation is periodically transferred to restricted - expendable accounts for expenditure as specified by the purpose of the endowment. Each institution maintains pertinent information related to each endowment fund including donor; amount and date of donation; restrictions by the source of limitations; limitations on investments, etc.
Restricted - expendable net position includes resources in which the USG is legally or contractually obligated to spend resources in accordance with restrictions by external third parties.
Unrestricted net position represents resources derived from student tuition and fees, state appropriations, and sales and services of educational departments and auxiliary enterprises. These resources are used for transactions relating to the educational and general operations of the USG, and may be used at the discretion of the governing board to meet current expenses for those purposes, except for unexpended state appropriations (surplus). Unexpended state appropriations must be refunded to the Office of the State Treasurer. These resources also include auxiliary enterprises, which are substantially self-supporting activities that provide services for students, faculty and staff.
When an expense is incurred that can be paid using either restricted or unrestricted resources, the USG's policy is to first apply the expense towards unrestricted resources, and then towards restricted resources.
Income Taxes The USG, as a political subdivision of the State of Georgia, is excluded from Federal income taxes under Section 115(1) of the Internal Revenue Code, as amended.
Classification of Revenues and Expenses The Statement of Revenues, Expenses and Changes in Net Position classifies fiscal year activity as operating and nonoperating according to the following criteria:
Operating revenue includes activities that have the characteristics of exchange transactions, such as (1) student tuition and fees, net of scholarship allowances, (2) certain federal, state and local grants and contracts, and (3) sales and services.
Nonoperating revenue includes activities that have the characteristics of non-exchange transactions, such as gifts and contributions, and other revenue sources that are defined as non-operating revenue by GASB Statements No. 9, Reporting Cash Flows of Proprietary and Non-expendable Trust Funds and Governmental Entities That Use Proprietary Fund Accounting, and No. 34, Basic Financial Statements--and Management's Discussion and Analysis--for State and Local Governments, such as state appropriations and investment income.
Operating expense includes activities that have the characteristics of exchange transactions.
Nonoperating expense includes activities that have the characteristics of non-exchange transactions, such as capital financing costs and costs related to investment activity.
Scholarship Allowances Scholarship allowances are the difference between the stated charge for goods and services provided by the USG, and the amount that is paid by students and/or third parties making payments on the students' behalf. Certain governmental grants, such as Pell grants, and other Federal, state or nongovernmental programs are recorded as either operating or non-operating revenues in the USG's financial statements. To the extent that revenues from such programs are used to satisfy tuition and fees and other student charges, the USG has recorded contra revenue for scholarship allowances. Student tuition and other fee revenues reported on the Statement of Revenues, Expenses and Changes in Net Position are net of discounts and allowances of $577,886,391.
70 University System of Georgia

Restatement of Prior Year Net Position The USG made the following restatements:

Net position, beginning of year, as originally reported

Business-type Activities

Discretely Presented Component Units

$ 3,106,069,636 $ 3,649,184,723

Changes in financial reporting entity Changes in accounting principles
Re-evaluation of capital assets and capital lease agreements between the institutions and their foundations Net effect of converting previously blended component units from GASB basis of accounting to FASB basis of accounting Net effect from converting from modified cash basis of accounting to GASB basis of accounting for AU Medical Associates Correction of prior year errors Capital assets Receivables Due from primary government Due to component units Payables Advances

(50,924,174)
391,980
(3,974,531) (120,943)
(19,482,078) (1,329,178) 4,153,386

167,333,732
(14,786,284) 5,138,687
19,482,078

Net position, beginning of year, restated

$ 3,034,784,098 $ 3,826,352,936

Changes in Financial Reporting Entity After evaluating changes made during the current fiscal year to the bylaws for Georgia Southern University Housing Foundation, Inc., UWG Real Estate Foundation, Inc., and VSU Auxiliary Services Real Estate Foundation, the determination was made that these foundations no longer met requirements for inclusion in the financial reporting entity as business-type activities. However, the determination was made that it would be misleading to exclude these foundations from the financial reporting entity. Therefore, these foundations are reported as discretely presented component units. The effect of this determination was a decrease to business-type activity beginning net position and an increase to discretely presented component unit beginning net position in the amount of $50.9 million. Additionally, the beginning cash and cash equivalents reported on the Statement of Cash Flow was restated by $55.5 million.
In addition to the foundations mentioned above, the determination was made that Augusta University Foundation, Inc., Augusta University Research Institute, Inc., Georgia Advanced Technology Ventures, Inc., Georgia Health Sciences Foundation, Inc., Georgia State University Research Foundation Inc. and Affiliates, and Kennesaw State University Athletic Association, Inc. met the requirements for inclusion as discretely presented component units. The effect of this determination was an increase to discretely presented component unit beginning net position in the amount of $116.4 million.
Special Items During fiscal year 2017, the University of West Georgia sold land and buildings located in Newnan, Georgia. Total proceeds from the sale were $877,965 and the net book value of the assets sold were $2,007,924. This resulted in a loss on sale of assets of $1,129,959.
Augusta University transferred property to the Georgia Technology Authority in fiscal year 2017 consisting of approximately 16.47 acres of land formerly known as the Georgia Golf Hall of Fame located at 1 Eleventh Street in Augusta, Richmond County, Georgia valued at $5,265,951.

2017 Annual Financial Report 71

In January 2017, the lease for the Georgia State University Student Recreation Center was amended. Under the amended lease terms, the future lease payments will be reduced by a cumulative total of $9,696,791 and the lease maturity date advances from June 2021 to September 2018. As a result, the University had a Special Item Gain for the Student Recreation Center of $7,228,875 for the year ending June 30, 2017, representing the net present value of the reduction in the future lease payments.
In January 2017, the lease for the Georgia State University Alpharetta Center was amended. Under the amended lease terms, the future lease payments will be reduced by a cumulative $2,289,668 and the lease maturity date advances from June 2020 to October 2018. As a result, the University had a Special Item Gain for the Alpharetta Center of $1,406,391 for the year ending June 30, 2017, representing the net present value of the reduction in future lease payments.
The remaining special item transfer of $19,496 related to the transfer of equipment outside of the reporting entity.
Note 2 Deposits and Investments
Cash and cash equivalents and investments as of June 30, 2017 are classified in the accompanying statement of net position and statement of fiduciary net position as follows:

Cash & Cash Equivalents Short-Term Investments Investments Non Current - Investments Cash (Externally Restricted) Short Term Investments (Externally Restricted) Investments (Externally Restricted)

$

1,530,433,601

31,443,424

98,861,978

240,151,830

6,006,227

20,876

186,673,642

$

2,093,591,578

Cash on hand, deposits and investments as of June 30, 2017 consist of the following:

Cash on Hand Deposits with Financial Institutions Investments Pooled Assets Held on Behalf of Component Units

$

1,141,272

664,416,357

1,529,854,830

(101,820,881)

$

2,093,591,578

A. Deposits with Financial Institutions Deposits include certificates of deposits and demand deposit accounts, including certain interest bearing demand deposit accounts. The custodial credit risk for deposits is the risk that in the event of a bank failure, the USG's deposits may not be recovered. Funds belonging to the State of Georgia (and thus the USG) 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 any one or more of the following securities as enumerated in the Official Code of Georgia Annotated (O.C.G.A.) 50-17-59:
1. Bonds, bills, notes, certificates of indebtedness, or other direct obligations of the United States or of the State of Georgia.
2. Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia.
3. Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose.

72 University System of Georgia

4. Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia.
5. Bonds, bills, certificates of indebtedness, notes or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association and the Federal National Mortgage Association.
6. Guarantee or insurance of accounts provided by the Federal Deposit Insurance Corporation. 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 of Georgia.
At June 30, 2017, the bank balances of the USG's deposits totaled $709,516,362. This balance includes deposits in Fiduciary funds as these balances are not separable from the holdings of the USG. Of these deposits, $45,455,057 were exposed to custodial credit risk as follows:

Uninsured and uncollaterized

$

Uninsured and collateralized with securities held by the pledging financial institution

Uninsured and collateralized with securities held by the pledging financial institution's trust departments or agents, but not in the Institution's name

3,528,818 6,525,979 35,400,260

Total deposits exposed to custodial credit risk

$

45,455,057

B. Investments The USG maintains an investment policy which fosters sound and prudent judgment in the management of assets to ensure safety of capital consistent with the fiduciary responsibility it has to the citizens of Georgia and which conforms to Board of Regents investment policy. All investments are consistent with donor intent, Board of Regents policy and applicable federal and state laws.
GASB Statement No. 72, Fair Value Measurements and Application, which requires fair value measurement be classified and disclosed in one of the following three categories ("Fair Value Hierarchy"):
Level 1 - Quoted prices are available in active markets for identical investments as of the reporting date.
Level 2 - Pricing inputs are observable for the investments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1; inputs include comparable market transactions, pricing of similar instruments, values reported by the administrator, and pricing expectations based on internal modeling. Fair value is determined through the use of models or other valuation methodologies.
Level 3 - Pricing inputs are unobservable for the investment and include situations where there is little, if any, market activity for the investments.

2017 Annual Financial Report 73

The following table summarizes the valuation of the USG's investments measured at fair value on a recurring basis and at net asset value as of June 30, 2017.

Investment type: Debt Securities U.S. Treasuries U.S. Agencies Explicitly Guaranteed Implicitly Guaranteed Bond Securities Corporate Debt Guaranteed Investment Contracts Money Market Mutual Funds Municipal Obligations Mutual Bond Funds Other Investments Equity Mutual Funds - Domestic Equity Mutual Funds - International Equity Securities - Domestic Equity Securities - International Real Estate Held for Investment Purposes Real Estate Investment Trusts

Fair Value

Level 1

Fair Value Hierarchy Level 2

Level 3

$ 60,226,971 $ 59,882,857 $

344,114

213,610,457 456,020,548
12,973,735 720,018 446,342
7,923,737 1,025,729 84,764,956

290,134 46,292,207 12,973,735
11,380
7,923,737 1,025,729 84,764,956

213,320,323 409,728,341
708,638 $

105,126,884 43,262,105
125,475,231 1,011,664 6,315,844 1,313,078

105,126,884 43,262,105
125,475,225 801,529
1,313,078

210,135

446,342
6 6,315,844

1,120,217,299 $ 489,143,556 $ 624,311,551 $

6,762,192

Investment Pools Office of the State Treasurer Georgia Fund 1 Georgia Extended Asset Pool

402,689,649 6,947,882

Total Investments

$ 1,529,854,830

Investments classified in Level 1 are valued using prices quoted in active markets for those securities.
Investments classified in Level 2 are valued using a matrix pricing technique. Matrix pricing is used to value securities based on the securities' relationship to benchmark quoted prices.
Investments classified in Level 3 includes real estate funds that invest primarily in U.S. commercial real estate. The fair values of the investment in this category have been estimated using the net asset value of the USG's ownership interest in partners' capital. These investments are less liquid and, generally, cannot be redeemed with the funds through normal redemption procedures. Distributions from this fund will be received as the underlying investments of the fund are liquidated.
The USG holds positions in the Georgia Fund 1 and Georgia Extended Asset Pool investment pools managed by the Georgia Office of the State Treasurer. The unit of account is each share held, and the value of the position would be the fair value of the pool's share price multiplied by the number of shares held. The USG does not "look through" the pool to report a pro rata share of the pool's investments, receivables, and payables.

74 University System of Georgia

Board of Regents Pooled Investment Program The USG serves as fiscal agent for various units of the University System of Georgia and affiliated organizations. The USG pools the monies of these organizations with the USG's monies for investment purposes. The investment pool is not registered with the SEC as an investment company. The fair value of the investments is determined daily. The pool does not issue shares. Each participant is allocated a pro rata share of each pooled investment fund balance at fair value along with a pro rata share of the pooled fund's investment returns.
The USG maintains investment policy guidelines for each pooled investment fund that is offered to qualified University System participants. These policies are intended to foster sound and prudent responsibility each institution has to the citizens of Georgia and which conforms to the Board of Regents investment policy. All investments must be consistent with donor intent, Board of Regents policy, and applicable Federal and state laws. Units of the University System of Georgia and their affiliated organizations may participate in the Pooled Investment Fund program. The overall character of the pooled fund portfolio should be one of above average quality, possessing at most an average degree of investment risk.
The Board of Regents' pooled investment fund options are described below.
1. Short-Term Fund The Short-Term Fund is available to both University System of Georgia institutions and their affiliated organizations. The Fund provides a current return and stability of principal while affording a means of overnight liquidity for projected cash needs. Investments are in securities allowed under O.C.G.A. 50-17-59 and 50-17-63. The average maturities of investments in this fund will typically range between daily and three years, and the fund will typically have an overall average duration of - 1 year. The overall character of the portfolio is of Agency quality, possessing a minimal degree of financial risk. The market value of the Short-Term Fund at June 30, 2017 was $509,546,373.
2. Legal Fund The Legal Fund is available to both University System of Georgia institutions and their affiliated organizations. The Fund provides an opportunity for greater return and modest principal growth to the extent possible with the securities allowed under O.C.G.A. 50-17-59 and 50-17-63. The average maturities of investments in this fund will typically range between five and ten years, with a maximum of thirty years for any individual investment. The overall character of the portfolio is Agency quality, possessing a minimal degree of financial risk. The market value of the Legal Fund at June 30, 2017 was $11,894,009.
3. Balanced Income Fund The Balanced Income Fund is available to both University System of Georgia institutions and their affiliated organizations. The Fund is designed to be a vehicle to invest funds that are not subject to the state regulations concerning investing in equities. This pool is appropriate for investing longer term funds that require a more conservative investment strategy. Permitted investments in the fund are domestic US equities, domestic investment grade fixed income, and cash equivalents.
The equity allocation shall range between 30% and 40%, with a target of 35% of the total portfolio. The fixed income (bond) portion of the portfolio shall range between 60% and 70%, with a target of 65% of the total portfolio. Cash reserves and excess income are invested at all times in the highest quality par stable (A1, P1) institutional money market mutual funds, or other high quality short term instruments. The market value of the Balanced Income Fund at June 30, 2017 was $18,194,442.
4. Total Return Fund The Total Return Fund is available to both University System of Georgia institutions and their affiliated organizations. The Fund is another pool designed to be a vehicle to invest funds that are not subject to state regulations concerning investing in equities. This pool offers greater overall equity exposure and is appropriate for investing longer term funds such as endowments. Permitted investments in the fund are domestic US equities, domestic investment grade fixed income, and cash equivalents.
The equity allocation shall range between 60% and 70%, with a target of 65% of the total portfolio. The fixed income (bond) portion of the portfolio shall range between 30% and 40%, with a target of 35% of the total portfolio. Cash reserves and excess income are invested at all times in the highest quality par stable (A1, P1) institutional money market mutual funds, or other high quality short term instruments. The market value of the Total Return Fund at June 30, 2017 was $12,891,262.
2017 Annual Financial Report 75

5. Diversified Fund The Diversified Fund is available to both University System of Georgia institutions and their affiliated organizations. The Fund is designed to provide improved return characteristics with reduced volatility through greater diversification. This pool is appropriate for investing longer term funds such as endowments. Permitted investments in the fund may include domestic, international and emerging market equities, domestic fixed income and global fixed income.

The equity allocation shall range between 50% and 75% of the portfolio, with a target of 65% of the total portfolio. The fixed income (bond) portion of the portfolio shall range between 25% and 50%, with a target of 35% of the total portfolio. Cash reserves and excess income are invested at all times in the highest quality par stable (A1, P1) institutional money market mutual funds, or other high quality short term instruments. The market value of the Diversified Fund at June 30, 2017 was $178,057,658.

6. Diversified Fund for Foundations The Diversified Fund for Foundations is available only to University System of Georgia affiliated organizations. Like the Diversified Fund, the fund is designed to provide improved return characteristics with reduced volatility through greater diversification and is appropriate for investing longer term funds such as endowments. Investments in the fund may include domestic, international and emerging market equities, domestic and global investment grade and non-investment grade fixed income and liquid alternative investments.

The equity allocation shall range between 40% and 75% of the portfolio, with a target of 65% of the total portfolio. The fixed income (bond) portion of the portfolio shall range between 10% and 40% of the portfolio, with a target of 20% of the total portfolio. The alternatives portion of the portfolio shall range between 0% and 30% of the portfolio, with a target of 15% of the total portfolio. Cash reserves and invested income are invested at all times in the highest quality par stable (A1, P1) institutional money market funds, or other high quality short term instruments. The market value of the Diversified Fund for Foundations at June 30, 2017 was $53,857,466.

Condensed financial information for the Board of Regents Pooled Investment Program is as follows:

Statement of Net Position - June 30, 2017

Assets

Pooled Investments*

$

Receivables

$

Distribution of Net Position

USG Account Balance

$

Component Units & Affiliated Organizations

$

784,030,972 410,238
784,441,210
634,490,541 149,950,669 784,441,210

* Pooled Investments in the Short Term Investment Fund of $509,546,373 are reported as Cash and Cash Equivalents on the Statements of Net Position and Fiduciary Net Position

Statement of Changes in Net Position - June 30, 2017

Market Value Plus Accrued Income on July 1, 2016 $

Receipts

Disbursements

Administrative Expenses

Distributions

Investment Results

Income Collected and Accrued

Realized Gain/Loss on Assets Sold

Change in Unrealized Gain/Loss

Amortization (Short-Term Fund)

Market Value Plus Accrued Income on June 30, 2017

$

741,307,296 141,413,134
(790,953) (128,518,205)
12,179,876 1,618,287
18,105,451 (873,676)
784,441,210

76 University System of Georgia

Office of the State Treasurer Investment Pools The Georgia Fund 1 Investment Pool, managed by the Office of the State Treasurer, is not registered with the Securities and Exchange Commission as an investment company, and the State does not consider Georgia Fund 1 to be a 2a7like pool. This investment is valued at the pool's share price, $1 per share. The Georgia Fund 1 Investment Pool is an AAAf rated investment pool by Standard and Poor's. The Weighted Average Maturity of the Fund is 26 days.
The Georgia Extended Asset Pool, managed by the Office of the State Treasurer, is not registered with the Securities and Exchange Commission as an investment company. Net Asset Value (NAV) is calculated daily to determine current share price, which was $1.99 at June 30, 2017. The Georgia Extended Asset Pool is an AA+f rated investment pool by Standard and Poor's. The Weighted Average Maturity of the Fund is .09 years.
Interest Rate Risk Interest rate risk is the risk that changes in interest rates of debt investments will adversely affect the fair value of an investment. The USG's policy for managing interest rate risk attempts to match investments with expected cash requirements.

Investment type: Debt Securities U.S. Treasuries U.S. Agencies Explicitly Guaranteed Implicitly Guaranteed Bond Securities Corporate Debt Guaranteed Investment Contracts Money Market Mutual Funds Municipal Obligations Mutual Bond Funds
Other Investments Equity Mutual Funds - Domestic Equity Mutual Funds - International Equity Securities - Domestic Equity Securities - International Real Estate Held for Investment Purposes Real Estate Investment Trusts
Investment Pools Office of the State Treasurer Georgia Fund 1 Georgia Extended Asset Pool
Total Investments

Fair Value

Less Than 3 Months

4-12 Months

1-5 Years

6-10 Years

More Than 10 Years

$ 60,226,971 $ 30,231,018 $

269,284 $ 26,209,424 $ 3,517,245

213,610,457 456,020,548
12,973,735 720,018 446,342
7,923,737 1,025,729 84,764,956

148,147,767 248,287,259
11,383
7,923,737 5,000
80,572

18,389,104 76,087,360
97,548
20,337

16,287,076 74,571,067
347,510 431,855
435,970 4,390,659

$ 13,870,260 10,025,017
179,232

30,786,510 43,204,602
2,601,208
446,342

114,766 42,700,255

469,993 37,573,133

837,712,493 $ 434,686,736 $ 94,863,633 $ 122,673,561 $ 70,406,775 $ 115,081,788

105,126,884 43,262,105
125,475,231 1,011,664 6,315,844 1,313,078

402,689,649 6,947,882
$ 1,529,854,830

2017 Annual Financial Report 77

Custodial Credit Risk Custodial credit risk for investments is the risk that, in the event of a failure of the counterparty to a transaction, the USG will not be able to recover the value of the investment or collateral securities that are in the possession of an outside party. The USG's policy for managing custodial credit risk is:

1. The USG has appointed a federally regulated banking institution as custodian. The custodian performs its duties to the standards of professional custodian and is liable to the USG for claims, losses, liabilities and expenses arising from its failure to exercise ordinary care, its willful misconduct, or its failure to otherwise act in accordance with the contract.

2. All securities transactions are to be settled on a delivery vs. payment basis through an approved depository institution such as the Depository Trust Company or the Federal Reserve.

3. Repurchase agreements are to be collateralized by United States Treasury securities at 102% of the market value of the investment at all times.

At June 30, 2017, $10,191,691 was uninsured and held by the investment's counterparty's trust department or agent, but not in the USG's name. Of this balance, $1,368,744 is related to the Deferred Compensation Fiduciary Fund.

Credit Quality Risk Credit quality risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. The USG's policy for managing credit quality risk is contained in the investment policy guidelines for the various pooled investment funds, colleges, universities, and foundations:

1. In the Short-Term Fund and Legal Fund, all debt issues must be eligible investments under O.C.G.A 50-17-59 and 50-17-63. Other investment portfolios of debt securities funds also must meet the eligible investment criteria under the same code section.

2. In the Balanced Income Fund, Total Return Fund, and Diversified Fund, total fixed income portfolios should have an average credit quality rating of at least A. Overnight investments shall be limited to high quality institutional money market mutual funds rated A1, P1 or other high quality short-term debt instruments rated at least AA+.

3. In the Diversified Fund for Foundations, fixed income investments include investment grade and high yield domestic bonds, dollar-and non-dollar denominated global bonds, and emerging market bonds. Overnight investments shall be limited to high quality institutional money market mutual funds rated A1, P1 or other high quality short-term debt instruments rated at least AA+.

The investments subject to credit quality risk are reflected below:

Related Debt Investments
U. S. Agency Securities
Bond Securities
Corporate Debt
Guaranteed Investment Contracts Money Market Mutual Fund
Municipal Obligation
Mutual Bond Fund

Fair Value

AAA

AA

A

BBB

BB

B

Unrated

$ 456,020,548 $ 12,973,735 720,018
446,342
7,923,737 1,025,729 84,764,956

600,885 $ 1,849,638 289,849 $

328,238 296,117

2,102,657 359,428 543,940

204,696 $

214,090

312,831 30,768

$ 1,090,414

25,232 11,795 $

$ 453,570,025 12,973,735 11,383
446,342 5,821,080

11,681

82,780,241

$ 563,875,065 $ 1,225,240 $ 5,145,512 $

548,295 $ 1,304,504 $

37,027 $

11,681 $ 555,602,806

The Early Retirement Plan Fiduciary Fund has $12,190,357 in bond securities and $3,407,163 in money market mutual funds (Cash and Cash Equivalents on the Statement of Net Position). Of these investments, $2,043,331 of the money market mutual funds are rated AA, while the remaining investments are not rated.

78 University System of Georgia

The Deferred Compensation Fiduciary Fund has $1,029,602 in mutual bond funds, $446,342 in guaranteed investment contracts, and $339,142 in money market mutual funds. These investment are not rated.

Concentration of Credit Risk Concentration of credit risk is the risk of loss attributed to the magnitude of a government's investment in a single issuer. The USG's policy requires diversification of investments to reduce overall portfolio risk while maintaining market rates of return.

At June 30, 2017, approximately 28%, 11%, 11%, 8%, and 7% of the business-type activity and Board of Regents Retiree Health Benefit Fiduciary Fund investments were investments in Local Government Investment Pool (Georgia Fund 1), Government National Mortgage Assn. notes, Federal National Mortgage Assoc. pool, Federal Home Loan Mortgage Corp. notes, and Federal National Mortgage Assoc. notes, respectively.

At June 30, 2017, approximately 19%, 17%, 6%, 5% and 5% of the Deferred Compensation Fiduciary Fund investments were investments in Fidelity Contrafund Fund, Fidelity Balanced Fund, TIAA traditional annuity, TIAA Real Estate Fund, and Fidelity Freedom 2020 Fund, respectively.

See Note 14 - Retirement Plans for concentration of credit risk for the Early Retirement Plan.

Foreign Currency Risk Foreign currency risk is the risk that changes in exchange rates will adversely affect the fair value of an investment or a deposit. Exposure to foreign currency credit risk is limited to funds maintained in foreign accounts for the Study Abroad Program.

Currency British Pound European Euro

Short-Term $ 14,910
32,774

Total securities subject to foreign currency risk

$ 47,684

Note 3 Accounts Receivable
Accounts receivable consisted of the following at June 30, 2017:

Business Type Activities

Student Tuition and Fees Auxiliary Enterprises and Other Operating Activities Federal Financial Assistance Georgia Student Finance Commission Georgia State Financing and Investment Commission Due from Affiliated Organizations Due from Component Units Other
Less: Allowance for Doubtful Accounts
Net Accounts Receivable

$

64,634,551

84,766,229

83,511,949

14,913,317

18,550,258

15,569,740

192,166,154

107,850,265

581,962,463

34,748,933

$

547,213,530

2017 Annual Financial Report 79

Note 4 Inventories
Inventories consisted of the following at June 30, 2017: Consumable Supplies Merchandise for Resale

$

4,931,104

18,721,873

Total

$

23,652,977

Note 5 Notes and Loans Receivable
The Federal Perkins Loan Program (the Program) comprises substantially all of the loans receivable at June 30, 2017. The Program provides for cancellation of a loan at rates of 10% to 30% per year up to a maximum of 100% if the participant complies with certain provisions. The Federal government reimburses the USG for amounts canceled under these provisions. As the USG determines that loans are uncollectible and not eligible for reimbursement by the federal government, the loans are written off and assigned to the U.S. Department of Education. The USG has provided an allowance for uncollectible loans, which, in management's opinion, is sufficient to absorb loans that will ultimately be written off. At June 30, 2017, the allowance for uncollectible loans was $2,175,254.
Note 6 Capital Assets

Changes in capital assets for the year ended June 30, 2017 are shown below:

Capital Assets, Not Being Depreciated: Land Capitalized Collections Construction Work-in-Progress Software Development-in-Progress
Total Capital Assets Not Being Depreciated

(Restated) Balance
July 1, 2016

Special Item and Other Transfers

Additions

Reductions

Balance June 30, 2017

$ 399,205,599 $ 49,224,934
238,562,157 --
686,992,690

(6,156,151) $ 94,379 51,871
(6,009,901)

12,264,322 $ 2,129,122
183,145,309 9,521,221
207,059,974

89,739 $ 199,140,370 199,230,109

405,224,031 51,448,435
222,618,967 9,521,221
688,812,654

Capital Assets, Being Depreciated/Amortized: Infrastructure Building and Building Improvements Facilities and Other Improvements Equipment Library Collections Capitalized Collections Software
Total Capital Assets Being Depreciated/Amortized

363,828,172 11,408,922,246
436,437,064 1,589,593,408
894,571,926 6,739,698
42,358,439 14,742,450,953

(1,389,759) (120,650) (94,379)
(1,604,788)

20,000,338 541,404,703
25,120,143 129,716,775
32,439,612 137,500
23,830,375 772,649,446

7,805,417 707,460
62,415,273 4,498,919 1,800
75,428,869

383,828,510 11,941,131,773
460,849,747 1,656,774,260
922,512,619 6,781,019
66,188,814 15,438,066,742

Less: Accumulated Depreciation/Amortization Infrastructure Building and Building Improvements Facilities and Other Improvements Equipment Library Collections Capitalized Collections Software
Total Accumulated Depreciation/Amortization

140,607,524 3,551,589,932
169,292,280 1,143,135,784
719,471,179 1,339,521
21,355,162 5,746,791,382

222,700 (520,829) (222,699) 180,015
(1)
(340,814)

11,427,462 303,853,007
15,406,734 119,015,571
32,682,937 171,309
3,259,494 485,816,514

81,825 6,959,529
481,207 56,213,896
4,559,291
68,295,748

152,175,861 3,847,962,581
183,995,108 1,206,117,474
747,594,824 1,510,830
24,614,656 6,163,971,334

Total Capital Assets, Being Depreciated/Amortized, Net

8,995,659,571

(1,263,974)

286,832,932

7,133,121

9,274,095,408

Capital Assets, net

$ 9,682,652,261 $ (7,273,875) $ 493,892,906 $ 206,363,230 $ 9,962,908,062

80 University System of Georgia

For projects managed by GSFIC, GSFIC retains construction-in-progress on its books throughout the construction period and transfers the entire project to the USG when complete. For projects managed by the USG, the USG retains construction-in-progress on its books and is reimbursed by GSFIC. For the year ended June 30, 2017, GSFIC transferred capital additions from GSFIC managed projects valued at $131,962,266 to the USG. In addition, at June 30, 2017, GSFIC had construction in progress of approximately $169,452,503 for incomplete GSFIC managed projects for the USG.

Note 7 Advances (Including Tuition and Fees)

Advances, including tuition and fees, consisted of the following at June 30, 2017:

Prepaid Tuition and Fees Research Other - Advances

Current Liabilities

$

132,705,546

52,288,510

41,268,737 $

Non-Current Liabilities
2,295

Totals

$

226,262,793 $

2,295

Note 8 Long-Term Liabilities

Changes in long-term liability for the year ended June 30, 2017 was as follows:

Lease Purchase Obligations

(Restated)

Balance

Balance

Current

July 1, 2016

Additions

Reductions

June 30, 2017

Portion

$3,106,081,566 $ 41,121,892 $ 104,284,400 $3,042,919,058 $ 93,920,624

Other Liabilities
Compensated Absences Net Pension Liability Notes and Loans Payable Claims and Judgments Other Post Employment Benefits Obligation Pollution Remediation Total

210,018,175 2,331,730,203
10,184,440 4,641,934
2,355,867,771 1,206,837
4,913,649,360

163,973,284 828,528,137
381,462 359,782,026
590,834 1,353,255,743

153,755,418 13,055,542 680,144 2,333,003 99,583,903 569,241
269,977,251

220,236,041 3,147,202,798
9,504,296 2,690,393 2,616,065,894 1,228,430 5,996,927,852

142,933,292
1,408,512 903,825
618,915 145,864,544

Total Long-Term Obligations

$8,019,730,926 $1,394,377,635 $ 374,261,651 $9,039,846,910 $ 239,785,168

2017 Annual Financial Report 81

Notes and Loans Payable The USG entered into a notes payable to secure Energy Performance Contracts. The interest rate for the notes vary between 2.003% to 2.04% and matures during fiscal year 2024. Below is the annual debt service related to the outstanding notes payable at June 30, 2017.

Year Ending June 30: 2018 2019 2020 2021 2022 2023 through 2027

Principal

Interest

$

1,408,512 $

1,437,861

1,467,287

1,497,313

1,527,954

2,165,369

185,183 156,349 126,923
96,897 66,256 39,620

$

9,504,296 $

671,228

Pollution Remediation Pollution remediation obligations reflect estimates that have the potential to change due to such items as price increases or reductions, new technology, or changes in applicable laws or regulations.
The University of Georgia is responsible for pollution remediation at the Milledge Avenue landfill site. USG has recorded a liability related to this pollution remediation in the amount of $784,715. The liability was determined using a fiveyear budget estimated provided by Brown and Caldwell. The University of Georgia does not anticipate any changes to the expected remediation outlay. There are no expected recoveries that have reduced this liability.
Georgia Institute of Technology is responsible for pollution remediation at all Institute sites including, but not limited to ground contamination, storage/treatment/disposal of hazardous materials, and asbestos abatement. USG has recorded a liability related to this pollution remediation in the amount of $443,715. There are no expected recoveries that have reduced this liability.
Note 9 Service Concessions Arrangements
Kennesaw State University (KSU) At June 30, 2017, Kennesaw State University (KSU) was a participant in three Service Concession Arrangements.
In August 2001, KSU entered into an agreement with KSUF whereby Kennesaw State University Foundation, Inc. (KSUF) will operate and collect revenues for housing operations from students. KSUF is required to operate the residence hall ("University Place") in accordance with a contractual agreement between the two parties. Under the terms of the agreement, Institution received no funds upfront from KSUF, but will take full ownership of the residence hall at the end of the operating agreement in June, 2031.
In August 2003, KSU entered into an agreement with KSUF whereby KSUF will operate and collect revenues for housing operations from students. KSUF is required to operate the housing ("University Village") in accordance with a contractual agreement between the parties. Under the terms of the agreement, Institution received no funds upfront from KSUF, but will take full ownership of the housing at the end of the operating agreement in June 2034.
In August 2007, KSU entered into an agreement with KSUF whereby KSUF will operate and collect revenues for housing operations from students. KSUF is required to operate the housing ("University Suites") in accordance with a contractual agreement between the parties. Under the terms of the agreement, Institution received no funds upfront from KSUF, but will take full ownership of the housing at the end of the operating agreement in June 2037.

82 University System of Georgia

At June 30, 2017, Institution reports the three housing residences as capital assets with a net carrying value of $63,555,727. For fiscal year 2017, Institution reported a remaining deferred inflow of resources of $63,555,727 and amortized revenue of $3,582,191. As part of the contractual agreement, KSUF is responsible for insuring each of the three residence halls and for providing maintenance services. Institution has no reportable future obligation for these services.
Georgia Gwinnett College (GGC) On May 13, 2014, GGC entered into an agreement with Aramark Education Services, LLC (Aramark), whereby Aramark will operate food services operations from service participants. The agreement is renewable for each year for ten years. On May 13, 2017, the contract renewal (amendment) included several changes to the financial commitment.
Aramark is required to operate the food service facilities in accordance with the contractual agreement. The contract includes a period fixed fee ("Annual Fixed Fee") payable to Aramark in the amount of $5.3 million per operating year. In the event that the amount paid to or retained by Aramark is less that the Annual Fixed Fee of $5.3 million, then GGC shall remit the amount equivalent to the difference of the Annual Fixed Fee minus Actual Operating Retainage. In the event that the actual operation year retainage is greater than 199.9% (upper threshold amount) of the Annual Fixed Fee, then Aramark shall remit the difference of the Annual Fixed Fee minus the upper threshold amount to GGC. If the actual operation year retainage is more than the Annual Fixed Fee but less than the 199.9% of the Annual Fixed Fee, then neither party shall owe anything to the other. GGC and Aramark will review the annual Fixed Fee prior to the commencement of each Operating Year and a revised Annual Fixed Fee shall be set forth in a written supplemental contract.
Under the terms of the contract Aramark committed a lump sum upfront payment of $360,000. The amortized revenue recorded related to the lump sum payment in fiscal year 2017 was $36,000 and the remaining deferred inflow was $252,000.
In addition, GGC was to receive three yearly installment payments of $500,000 from Aramark, the first payment was received in fiscal year 2015 and the second payment was received in fiscal year 2016. In fiscal year 2017, the contract amendment called for a return of any unamortized installment payments and that the 3rd installment payment of $500,000 not to be made. The unamortized installment payments of $775,641 was returned to Aramark in fiscal year 2017. The amortized revenue recorded in fiscal year 2017 for the installment payments was $68,803 and the remaining deferred inflow is $0.
Under terms of the original agreement Aramark also committed $5,250,000 in dining facility renovations. In fiscal year 2017, the contract amendment called for a return of outstanding unamortized amounts of $1,615,483 and for a reduction of $704,805 to deferred inflows for uncollected funds. The amortized revenue recorded in fiscal year 2017 for the remaining construction commitment was $326,438 leaving deferred inflow balance of $2,285,067.
For Fiscal Year 2017, GGC reported a total remaining Deferred Inflow of Resources of $2,537,067 related to the service concession arrangement.
University System Office (USO) During fiscal year ended June 30, 2015, the Board of Regents of the University System of Georgia (BOR) entered into a Service Concession Arrangement (SCA) with Corvias Campus Living-USG,LLC, whereby Corvias Campus LivingUSG,LLC, manages, maintains and operates certain existing student housing resources on the campuses of nine institutions: Abraham Baldwin Agricultural College; Armstrong State University; Augusta University; College of Coastal Georgia; Columbus State University; Dalton State College; East Georgia State College; Georgia State University; and the University of North Georgia.
Pursuant to the contractual stipulations of this SCA, whereby the BOR and Corvias Campus Living- USG, LLC, are the "parties" participating in this agreement, as of May 14, 2015, the institutions noted above transferred the housing resources covered by this SCA, along with associated capital lease obligations to the University System Office in fiscal year 2015 through Special Item Transfer. In accordance with the SCA, in May 2015, Corvias Campus Living-USG, LLC, provided $311,561,781 to the BOR to retire the capital lease obligations transferred to the University System Office. These lease obligations were subsequently retired using the funds provided. The housing assets are reported in Note 6 in the Building and Building Improvements category. The $311,561,781 received from Corvias Campus LivingUSG, LLC, was reported as a Deferred Inflow of Resources in fiscal year 2015. The SCA is for 65 years (780 months) to end in June 2080. The University System Office amortized $4,793,258 of this Deferred Inflow in June 2017, leaving a remaining Deferred Inflow of Resources balance of $301,575,826 at June 30, 2017.
2017 Annual Financial Report 83

In addition to the existing student housing arrangement, Corvias Campus Living-USG, LLC designs and constructs authorized new housing projects that, once constructed, are similarly managed, maintained and operated on seven of the nine campuses with existing student housing resources. Two of these projects were completed within fiscal year 2016 and their fair market values were capitalized increasing Capital Assets by $10,650,907 for the College of Coastal Georgia student housing project and by $11,989,213 for the student housing project on the East Georgia State College campus. In fiscal year 2017, five additional housing projects were completed and their fair market values were capitalized increasing Capital Assets by $154,415,645. The five projects included Augusta University for $46,621,975; Columbus State University for $18,945,689; Dalton State College for $15,784,387; Georgia State University for $50,272,766; and University of North Georgia for $22,790,828. In addition, final construction costs were added to the College of Coastal Georgia housing project in the amount of $224,619 and to East Georgia State College housing project in the amount of $245,915 during fiscal year 2017. These additions are reported in Note 6 in the Building and Building Improvements category. A Deferred Inflow of Resources was recorded as the offset to the Capital Asset additions. The Deferred Inflows associated with these new projects are being amortized over the remaining life of the SCA. The University System Office amortized $2,579,103 of this Deferred Inflow in June 2017 related to these seven projects, leaving a remaining Deferred Inflow of Resources balance of $174,933,329 at June 30, 2017. Also part of this SCA, and beginning in fiscal year 2016, the University System Office receives $8,000,000 in Ground Rent and $500,000 in Supplemental Capital Repair and Replacement funds each year for the next ten years, with each amount escalating by 3% annually. The University System Office recorded Accounts Receivable and Deferred Inflow of Resources in the amount of $73,232,489 representing the present value of this revenue stream based on the agreement terms and will amortize the Deferred Inflows over a ten-year period. For the year ended June 30, 2017, the University System Office amortized $7,895,859 and recognized $859,141 in associated interest income, leaving a Deferred Inflow balance of $57,264,455 as of June 30, 2017. The University System Office also receives retained services funds each year as a percentage of gross revenues for that year. The University System Office has no reportable future obligation for these services.
84 University System of Georgia

Note 10 Net Position

The breakdown of business type activity net position for the USG fund at June 30, 2017 is as follows:

NET POSITION Net Investment in Capital Assets

$ 6,627,744,225

Restricted for Nonexpendable Permanent Endowment

193,258,875

Expendable Sponsored and Other Organized Activities Federal Loans Institutional Loans Term Endowments Quasi-Endowments Capital Projects
Sub-Total

145,781,688 40,277,387 25,883,670 1,537,322 19,051,049 16,754,205
249,285,321

Unrestricted Auxiliary Enterprises Operations Auxiliary Enterprises Renewals & Replacement Reserve Reserve for Encumbrances Reserve for Inventory Capital Liability Reserve Fund Health Insurance Reserve Other Unrestricted
Sub-Total

Total Net Position

$

(138,490,342) 212,684,980 450,509,475
3,824,247 20,394,870 168,650,084 (4,695,267,623) (3,977,694,309)
3,092,594,112

Note 11 Endowments
Donor Restricted Endowments Investments of the USG's endowment funds are pooled, unless required to be separately invested by the donor. For USG controlled, donor-restricted endowments, where the donor has not provided specific instructions, the Board of Regents permits Institutions to develop policies for authorizing and spending realized and unrealized endowment income and appreciation as they determined to be prudent. Realized and unrealized appreciation in excess of the amount budgeted for current spending is retained by the endowments. Current year net appreciation for the endowment accounts was $8,646,573 and is reflected as expendable restricted net position.
For endowment funds where the donor has not provided specific instructions, investment return of the USG's endowment funds is predicated on the total return concept. Annual payouts from the USG's endowment funds are based on a spending policy which limits spending between 3.0% and 6.0% of endowment principal market value. To the extent that the total return for the current year exceeds the payout, the excess is added to principal. If current year earnings do not meet the payout requirements, the USG uses accumulated income and appreciation from restricted expendable net asset endowment balances to make up the difference.

2017 Annual Financial Report 85

For endowment funds where the donor has not provided specific instructions, investment return of the USG's endowment funds is predicated under classical trust doctrines. Unless the donor has stipulated otherwise, capital gains and losses are accounted for as part of the endowment principal and are not available for expenditure.

For the current year, the USG did not incur investment losses that exceeded the related endowment's available accumulated income and net appreciation.

Note 12 Significant Commitments

See the Net Position note for amounts reserved for outstanding encumbrances at June 30, 2017. In addition to these encumbrances, the USG had other significant unearned outstanding construction or renovation contracts in the amount of $90,508,726 executed as of June 30, 2017. This amount is not reflected in the accompanying basic financial statements.

Note 13 Leases

Lease Obligations The USG is obligated under various capital and operating lease agreements for the acquisition or use of real property
and equipment.

Capital Leases The USG acquires certain real property and equipment through multi-year capital leases with varying terms and options. In accordance with O.C.G.A. 50-5-64, these agreements shall terminate absolutely and without further obligation at the close of the fiscal year in which it was executed and at the close of each succeeding fiscal year for which it may be renewed. These agreements may be renewed only by a positive action taken by the USG. In addition, these agreements shall terminate if the State does not provide adequate funding, but that is considered a remote possibility. The USG's principal and interest expenditures related to capital leases for fiscal year 2017 were $83,895,263 and $162,420,374, respectively.

The USG has $2,337,502,183 in outstanding lease obligations due to component units. Component units have $2,338,291,693 in investment in capital lease receivables due from the USG. The $789,510 difference in the USG's lease obligation and the component units' capital lease receivable is related to different reporting periods and other timing differences.

The USG has $573,666,205 in outstanding lease obligations due to affiliated organizations.

The following is a summary of the carrying values of assets held under capital lease at June 30, 2017:

Description
Leased Land & Land Improvements Leased Infrastructure Leased Equipment Leased Buildings & Building Improvements Leased Facilities and Other Improvements Total Assets Held Under Capital Lease

Gross Amount

Less: Accumulated Depreciation

Net, Assets Held Under Capital Lease at June 30, 2017

Outstanding Balances per Lease
Schedules at June 30, 2017

(+)

(-)

(=)

$

49,550,118

$

49,550,118 $

12,692,034

39,705,000 $

13,579,110

26,125,890

34,803,183

28,872,028

13,504,128

15,367,900

20,581,996

3,436,005,200

897,700,181

2,538,305,019

2,964,510,320

6,530,004

2,757,581

3,772,423

5,368,935

$ 3,560,662,350 $

927,541,000 $ 2,633,121,350 $ 3,037,956,468

Certain capital leases provide for renewal and/or purchase options. Generally purchase options at bargain prices of one dollar are exercisable at the expiration of the lease terms.

86 University System of Georgia

Operating Leases The USG leases land, facilities, office and computer equipment, and other assets. Some of these leases are considered for accounting purposes to be operating leases. Although lease terms vary, many leases are subject to appropriation from the General Assembly to continue the obligation. Other leases generally contain provisions that, at the expiration date of the original term of the lease, the USG has the option of renewing the lease on a year-to-year basis. Leases renewed yearly for a specified time period, i.e. lease expires at 12 months and must be renewed for the next year, may not meet the qualification as an operating lease. The USG's operating lease expense for fiscal 2017 was $45,737,484, which includes payments to related parties of $23,394,792. The USG is obligated to pay these related parties a total of $24,557,961 in the next fiscal year.

Future commitments for capital leases and for non-cancellable operating leases having remaining terms in excess of one year as of June 30, 2017, are as follows:

Year Ending June 30: 2018 2019 2020 2021 2022 2023 through 2027 2028 through 2032 2033 through 2037 2038 through 2042 2043 through 2047 2048 through 2052 2053 through 2057

Real Property and Equipment Capital Leases Operating Leases

$ 266,093,403 $ 266,098,356 265,567,918 266,629,113 267,810,240
1,342,012,159 1,298,650,986
946,284,129 414,753,930
16,779,696 3,869,257

44,339,204 51,833,932 50,492,520 45,688,355 41,915,890 166,617,157 109,640,668 22,216,018
1,680,676 663,580 663,580 132,716

Total minimum lease payments Less: Interest Less: Executory costs
Principal Outstanding

5,354,549,187 $ 1,925,193,003
386,437,126 $ 3,042,919,058

535,884,296 .

Note 14. Retirement Plans

The USG participates in various retirement plans administered by the State of Georgia under two major retirement systems: Teachers Retirement System of Georgia (TRS) and Employees' Retirement System of Georgia (ERS). These two systems issue separate publicly available financial reports that include the applicable financial statements and required supplementary information. The reports may be obtained from the respective administrative offices.

The significant retirement plans that the USG participates in are described below. More detailed information can be found in the plan agreements and related legislation. Each plan, including benefit and contribution provisions, was established and can be amended by State law.

2017 Annual Financial Report 87

A. Teachers Retirement System of Georgia and Employees' Retirement System of Georgia
Summary of Significant Accounting Policies Pensions: For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Teachers Retirement System of Georgia (TRS) and Employees' Retirement System (ERS), additions to/deductions for TRS's and ERS's fiduciary net position have been determined on the same basis as they are reported by TRS and ERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
General Information about the Teachers Retirement System Plan description All teachers of the USG as defined in O.C.G.A. 47-3-60 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. TRS issues a publicly available financial report that can be obtained at trsga.com/ publications.
Benefits Provided TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.
Contributions Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2017. USG's contractually required contribution rate for the year ended June 30, 2017 was 14.27% of annual the USG payroll. The USG's contributions to TRS totaled $246,122,567 for the year ended June 30, 2017.
General Information about the Employees' Retirement System Plan description ERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at ers.ga.gov/formspubs/formspubs.html.
Benefits provided The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS.
88 University System of Georgia

Under the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60.

Retirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension, at reduced rates, to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS.

Contributions Member contributions under the old plan are 4% of annual compensation, up to $4,200, plus 6% of annual compensation in excess of $4,200. Under the old plan, the State pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these State contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. USG's contractually required contribution rate, actuarially determined annually, for the year ended June 30, 2017 was 24.69% of annual covered payroll for old and new plan members and 21.69% for GSEPS members. USG's contributions to ERS totaled $2,975,529 for the year ended June 30, 2017. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2017, the USG reported a liability for its proportionate share of the net pension liability for TRS and ERS. The net pension liability was measured as of June 30, 2016. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2015. An expected total pension liability as of June 30, 2016 was determined using standard roll-forward techniques. The USG's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2016. At June 30, 2016, the USG's TRS proportion was 14.868689%, which was an increase of 0.128822% from its proportion measured as of June 30, 2015. At June 30, 2016, the USG's ERS proportion was 0.441431%, which was a increase of 0.040653% from its proportion measured as of June 30, 2015.

For the year ended June 30, 2017, the USG recognized pension expense of $343,998,712 for TRS and $3,491,734 for ERS. At June 30, 2017, the USG reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS

Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual experience $ 45,698,618 $ 15,169,187

ERS

Deferred Outflows of Resources

Deferred Inflows of Resources

$

48,226

Changes of assumptions

79,507,342

$

176,870

Net difference between projected and actual earnings on pension plan investments

388,061,039

2,123,067

Changes in proportion and differences between contributions and proportionate share of contributions

91,183,617

38,592,791

1,640,149

557,712

Contributions subsequent to the measurement date

246,122,567

2,975,529

Total

$ 850,573,183 $ 53,761,978 $ 6,915,615 $

605,938

2017 Annual Financial Report 89

The USG's contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2017. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

ERS

2018 2019 2020 2021 2022

$

75,462,894 $

$

75,462,746 $

$

235,997,695 $

$

156,978,692 $

$

6,786,611

1,072,782 407,148
1,144,644 709,574

Actuarial assumptions The total pension liability as of June 30, 2016 was determined by an actuarial valuation as of June 30, 2015 using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers Retirement System Inflation Salary increases Investment rate of return

2.75% 3.25% - 9.00%, average, including inflation 7.50%, net of pension plan investment expense, including inflation

Post retirement mortality rates were based on the RP 2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service retirements and dependent beneficiaries. The RP 2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for death after disability retirement. Rates of mortality in active service were based on the RP 2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2015 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.

Employees' Retirement System

Inflation

2.75%

Salary increases

3.25 7.00%, including inflation

Investment rate of return

7.50%, net of pension plan investment expense, including inflation

Post retirement mortality rates were based on the RP 2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. The RP 2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB and set back 7 years for males and set forward 3 years for females was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9 12% less than the actual number of deaths that occurred during the study period for service retirements and beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP 2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2015 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.

90 University System of Georgia

The long-term expected rate of return on TRS and ERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of pension plan investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class Fixed income Domestic large equities Domestic mid equities Domestic small equities International developed market equities International emerging market equities Alternatives
Total

TRS target allocation 30.00% 39.80% 3.70% 1.50% 19.40% 5.60% --%
100.00%

ERS target allocation 30.00% 37.20% 3.40% 1.40% 17.80% 5.20% 5.00%
100.00%

Long-term expected real rate of return*
(0.50)% 9.00 % 12.00 % 13.50 % 8.00 % 12.00 % 10.50 %

* Rates shown are net of the 2.75% assumed rate of inflation

Discount rate The discount rate used to measure the total TRS and ERS pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS and ERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

Sensitivity of the Institute's proportionate share of the net pension liability to changes in the discount rate: The following presents the USG's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the USG's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50%) or 1-percentage-point higher (8.50%) than the current rate:

Teachers Retirement System: Proportionate share of the net pension liability

1%

Current

1%

Decrease

discount rate

Increase

6.50%

7.50%

8.50%

$ 4,774,720,388 $ 3,067,576,327 $ 1,632,024,589

Employees' Retirement System: Proportionate share of the net pension liability

1%

Current

Decrease

discount rate

6.50%

7.50%

$ 28,298,356 $ 20,881,541 $

1% Increase 8.50%
14,560,938

Pension plan fiduciary net position Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS and ERS financial reports which are publically available at trsga.com/publications and ers.ga.gov/formspubs/formspubs.html, respectively.

2017 Annual Financial Report 91

B. Early Retirement Pension Plan

Plan Description Augusta University Early Retirement Pension Plan (ERP) is a single-employer defined benefit pension plan administered by Bryan, Pendleton, Swats, and McAlister. The plan was derived by Augusta University as a means of workforce reduction and was approved by the Board of Regents of the University System of Georgia (BOR) effective January 1, 2000.

The plan was designed to provide eligible participants additional benefits above the amounts payable through Teachers Retirement System of Georgia (TRS). The plan was designed to allow vested employees aged 55 or employees of any age with 25 years of creditable service to retire without penalties as applied by the Teachers Retirement System of Georgia (TRS) for early retirement.

The plan would allow for all participants to retire as if they were vested and aged 60 or had attained 30 years of creditable service. Any member who opted into the Optional Retirement Plan aged 55 with 10 years of service by June 30, 2000 was also eligible to participate in the plan.

The plan is closed to new entrants. There were no active plan participants. As of January 1, 2017, plan participants consisted of the following:

Inactive Plan Participants:

Retirees and Beneficiaries Currently Receiving Benefits

628

Terminated Employees Entitled to Deferred Benefits

0

Disabled Employees Entitled to Deferred Benefits

0

Total

628

Benefits Provided TRS provides a benefit equal to 2% of the participant's average annual compensation during the two consecutive years of creditable service which produce the highest such average, multiplied by the number of years of creditable service, limited to 40 years. If the participant has less than 30 years of creditable service and has not attained age 60 at the time of retirement, the benefit will be reduced by the lesser of 1/12 of 7% for each month that retirement precedes age 60 or 7% for each year or fraction of a year by which the participant has less than 30 years of creditable service at the time of retirement. In addition, a one-time 3% increase is applied to the first $37,500 of the participant's benefit at retirement.
The ERP provides the additional benefits that would have been payable under TRS based on the following adjustments:
Age of the participant was increased five years Participant's creditable service was increased five years Participant's annual rate of earnings as of August 1, 1999 was projected five years into the future with 3%
increases each year
ERP benefits will be increased 3% a year as a cost-of-living adjustment (COLA): 1-1/2% on each January 1 and July 1. The ERP provided COLA's for both the ERP and TRS benefits until actual eligibility for a COLA through TRS occurred. Since that time, the ERP has provided COLA's only on the portion of the benefit paid by the ERP, and TRS has provided COLA's under the terms of the TRS plan.
The ERP does not issue a standalone report.
Funding Policy The fund sources that provided for an employee's salary, as of December 31, 1999, would be responsible for funding the annuity to provide for retiree benefits. There is no additional cost to the employee/retiree, USG, or State of Georgia for this plan. Contributions are made by Augusta University based on the actuarial valuation of the plan. For fiscal year 2017, affiliated organizations contributed $5,886,802 to the plan on-behalf of the University.

92 University System of Georgia

Since this plan was not pre-funded, Augusta University's approach to collect and deposit as much into the ERP fund in the earlier years as is possible, thereby, realizing a greater return on investment. Effective January 1, 2017, the period to amortize the unfunded accrued liability was extended two years.With this change, the plan should be fully funded by June 30, 2025. The funding policy is reasonable and in compliance with minimum funding requirements set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law.

Investments Augusta University maintains an investment policy which fosters sound and prudent judgment in the management of assets to ensure safety of capital consistent with the fiduciary responsibility of the institution to the citizens of Georgia and which conforms to the USG investment policy. All investments are consistent with USG policy and applicable Federal and state laws.

Investments are reported at fair value. Securities traded on a national or international exchange are valued at the last reported sales price. The Augusta University's Investment Policy and Guidelines for managing concentration of credit risk requires that stocks and debt issues be diversified. Augusta University also relies upon the concentration of credit risk policy of the individual investment vehicles related to plan assets. More than 5% of the Pension Plan's Investments are in iShares Core Total U.S. Aggregate Bond Exchange-traded Fund (ETF), Vanguard Institutional Index Fund, iShares Russell 1000 Value ETF, and iShares Russell 1000 Growth ETF. These investments are 8.51%, 41.69%, 5.98%, and 10.19% respectively of the Plan's total investments.

For the fiscal year ended June 30, 2017, the annual money-weighted rate of return on pension plan investments, net of pension plan investment expense, was 13.39%.

Net Pension Liability (NPL) The components of the net pension liability at June 30, 2017 were as follows:

Total Pension Liability Plan Fiduciary Net Position

$ 149,152,995 (90,408,065)

Net Pension Liability

$ 58,744,930

Plan Fiduciary Net Position as a percentage of total pension liability is 60.61%.
Actuarial Assumptions The total pension liability was determined by an actuarial valuation as of January 1, 2017 with the results rolled forward to the June 30, 2017 measurement date using the following actuarial assumptions, applied to all periods included in the measurement: (a) rate of return of 7.50% per annum, compounded annually (b) inflation of 3%, and (c) cost of living increases of 3% per annum.
To better recognize current and future mortality improvements, effective June 30, 2017 mortality rates were based on the RP-2014 Mortality Table, adjusted to 2006, with generational mortality improvement projected after year 2006 using Scale MP-2015 rather than the previously used RP-2000 Mortality Table for Healthy Annuitants with projected improvement from year 2000 to year 2022 under Projection Scale AA.
The projection of cash flows used to determine the discount rate of 7.5% per annum, compounded annually assumes that employer contributions will be made at rates equal to the actuarially determined contribution rates. Based on that assumption, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members.Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
The long-term expected rate of return on pension plan investments was determined using a building- block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the longterm expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan's target asset allocation are summarized in the following table:

2017 Annual Financial Report 93

Asset Class Domestic Equity International Equity Fixed Income Real Estate Cash

Target Allocation 79.62%
--% 13.48%
--% 6.90%

Long-Term Expected Real Rate of Return
6.50% 7.25% 1.25% 5.75% 0.50%

Sensitivity of Net Pension Liability to Changes in the Discount Rate The following represents the net pension liability calculated using the stated discount rate, as well as what the net pension liability would be if it were calculated using a discount rate that is 1-percentage- point lower or 1-percentagepoint higher than the current rate:

Net Pension Liability

1%

Current

Decrease

discount rate

6.50%

7.50%

$ 71,235,851 $ 58,744,930 $

1% Increase 8.50%
47,883,650

Schedule of Changes in Net Pension Liability For the year ended June 30, 2017, the USG recognized net pension liability of $58,744,930 calculated as follows:

Total Pension Liability (a)

Plan Fiduciary Net Position (b)

Net Pension Liability (a) - (b)

Balance, June 30, 2016

$

151,817,059 $

80,322,348 $

71,494,711

Interest Experience losses (gains) Contributions - Employer Net investment income Benefit payments

10,875,630 77,619
(13,617,313)

13,084,672 10,618,358 (13,617,313)

10,875,630 77,619
(13,084,672) (10,618,358)
--

Net Change

(2,664,064)

10,085,717

(12,749,781)

Balance, June 30, 2017

$

149,152,995 $

90,408,065 $

58,744,930

Affiliated organizations contributed $5,886,802 to the plan on behalf of the USG.

Schedule of Changes in Pension Expense For the year ended June 30, 2017, the USG recognized pension expense of $5,409,026 from the following sources:

Interest Projected investment income Recognition of experience (gain)/loss Investment losses (gains) Pension Expense June 30, 2016

Pension Expense $ 10,875,630
(6,004,202) 77,619
459,979 $ 5,409,026

94 University System of Georgia

Deferred Outflows/Inflows of Resources At June 30, 2017, the USG reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Net difference between projected and actual earnings on pension plan investments

Deferred Pension Outflows of Resources

Deferred Pension Inflows of Resources

$

3,631,819 $

3,691,325

Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ending June 30: 2018 2019 2020 2021

$

459,979

$

459,979

$

(56,630)

$ (922,834)

C. Defined Contribution Plan:
Regents Retirement Plan Plan Description The Regents Retirement Plan, a single-employer defined contribution plan, is an optional retirement plan that was created/established by the Georgia General Assembly in O.C.G.A. 47-21-1 et.seq. and administered by the Board of Regents of the University System of Georgia (Board). O.C.G.A. 47-3-68(a) defines who may participate in the Regents Retirement Plan. An "eligible university system employee" is a faculty member or all exempt full and partial benefit eligible employees, as designated by the regulations of the Board. Under the Regents Retirement Plan, a plan participant may purchase annuity contracts from three approved vendors (VALIC, Fidelity, and TIAA-CREF) for the purpose of receiving retirement and death benefits. 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 of the annuity contracts.
Funding Policy The institutions of the USG make monthly employer contributions to the Regents Retirement Plan on behalf of participants at rates determined by the Board. The Board reviews the contribution amount every three (3) years. For fiscal year 2017, the employer contribution was 9.24% for the participating employee's earnable compensation. Employees contribute 6% of their earnable compensation. Amounts attributable to all plan contributions are fully vested and non-forfeitable at all times.
The USG and the covered employees made the required contributions of $132,449,090 (9.24%) and $83,734,848 (6%), respectively.
VALIC, Fidelity, and TIAA-CREF have separately issued financial reports which may be obtained through their respective corporate offices.
Note 15 Risk Management
The USG offers its employees and retirees under the age of 65 access to three self insured healthcare plan options and one fully insured plan option. For the USG's Plan Year 2017, the following self-insured health care options were available: Blue Choice HMO plan, (Blue Cross and Blue Shield of Georgia) Consumer Choice HSA plan, and the (Blue Cross and Blue Shield of Georgia) Comprehensive Care plan.

2017 Annual Financial Report 95

The USG's participating employees and eligible retirees pay premiums into the plan fund to access benefits coverage. All units of the USG share the risk of loss for claims associated with these plans. The plan fund is considered to be a self-sustaining risk fund. The USG has contracted with Blue Cross and Blue Shield of Georgia, a wholly owned subsidiary of Anthem, Inc., to serve as the claims administrator for the self-insured healthcare plan options. In addition to the self-insured healthcare plan options offered to the employees and eligible retirees of the USG, a fully insured HMO healthcare plan option also is offered through Kaiser Permanente. The Comprehensive Care plan has a carved-out prescription drug plan administered through CVS Caremark. Pharmacy drug claims are processed in accordance with guidelines established for the Board of Regents' Prescription Drug Benefit Program. Generally, claims are submitted by participating pharmacies directly to CVS Caremark for verification, processing and payment. CVS Caremark maintains an eligibility file based on information furnished by Blue Cross and Blue Shield of Georgia on behalf of the various organizational units of the University System of Georgia. The self-insured dental plan is administered through Delta Dental.

Retirees age 65 and older participate in a secondary healthcare coverage for Medicare-eligible retirees and dependents provided through a retiree health care exchange option. The USG makes contributions to a health reimbursement account, which can be used by the retiree to pay premiums and out-of-pocket healthcare-related expenses.

A reconciliation of total estimated claims liabilities for employees and retirees for the fiscal years ended June 30, 2017, and June 30, 2016 is shown below:

Employees: Unpaid Claims and Claim Adjustments

June 30, 2017

$

50,977,835

June 30, 2016

$

36,497,000

Incurred Claims and Claim Adjustments Expenses Provisions for Insured Events of the Current Year

383,406,114

385,414,556

Payments - Claims and Claim Adjustments Attributable To Insured Events of the Current Year and Prior Years

382,695,770

370,933,721

Unpaid Claims and Claim Adjustments

$

51,688,179

$

50,977,835

Retirees: Unpaid Claims and Claim Adjustments

$

8,811,415

$

11,425,000

Incurred Claims and Claim Adjustments Expenses Provisions for Insured Events of the Current Year

86,008,435

124,501,761

Payments - Claims and Claim Adjustments Attributable To Insured Events of the Current Year and Prior Years

87,322,254

127,115,346

Unpaid Claims and Claim Adjustments

$

7,497,596

$

8,811,415

The Department of Administrative Services (DOAS) has the responsibility for the State of Georgia of making and carrying out decisions that will minimize the adverse effects of accidental losses that involve State government assets. The State believes it is more economical to manage its risks internally and set aside assets for claim settlement. Accordingly, DOAS processes claims for risk of loss to which the State is exposed, including general liability, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' indemnification. Limited amounts of commercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks.
The USG is part of the State of Georgia reporting entity, and as such, is covered by the State of Georgia risk management program administered by DOAS. Premiums for the risk management program are charged to the various state organizations by DOAS to provide claims servicing and claims payment.

96 University System of Georgia

A self-insured program of professional liability for its employees was established by the Board of Regents of the University System of Georgia under powers authorized by the O.C.G.A 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 of the performance of their duties or in any way connected therewith. The program is administered by DOAS as a Self-Insurance Fund.

Note 16 Contingencies

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

Litigation, claims and assessments filed against the USG, if any, are generally considered to be actions against the State of Georgia. Accordingly, significant litigation, 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, 2017.

Note 17 Post-Employment Benefits Other Than Pension Benefits

Plan Description and Funding Policy The Board of Regents Retiree Health Benefit Plan (Plan) is a single-employer, defined-benefit, healthcare plan administered by the University System Office, an organizational unit of the USG. The Plan was authorized pursuant to OCGA 47-21-21 for the purpose of accumulating funds necessary to meet employer costs of retiree postemployment health insurance benefits.

Pursuant to the general powers conferred by the OCGA 20-3-31, the USG has established group health and life insurance programs for regular employees of the USG. It is the policy of the USG to permit employees of the USG eligible for retirement or who become permanently and totally disabled to continue as members of the group health and life insurance programs. The USG offers its employees and retirees under the age of 65 access to three selfinsured healthcare plan options and one fully insured plan option. For the USG's Plan Year 2017, the following selfinsured health care options were available: Blue Choice HMO plan, (Blue Cross and Blue Shield of Georgia) Consumer Choice HSA plan, and the (Blue Cross and Blue Shield of Georgia) Comprehensive Care plan. The USG offers a selfinsured dental plan administered by Delta Dental.

Retirees age 65 and older participate in a secondary healthcare coverage for Medicare-eligible retirees and dependents provided through a retiree health care exchange option. The USG makes contributions to the retirees' health reimbursement account, which can be used by the retiree to pay premiums and out-of-pocket healthcare related expenses.

Membership of the Plan consisted of the following at June 30, 2017:
Active Employees Receiving Medical Not Receiving Medical Subtotal

40,838 8,982
49,820

Retirees or Beneficiaries Receiving Benefits

20,591

Total

70,411

The contribution requirements of plan members and the employer are established and may be amended by the Board. The Plan is substantially funded on a "pay-as-you-go" basis; however, amounts above the pay-as-you-go basis may be contributed annually, either by specific appropriation or by Board designation.

2017 Annual Financial Report 97

Organizational units of the University System of Georgia pay the employer portion for group insurance for eligible retirees. The employer portion of health insurance for its eligible retirees is based on rates that are established annually by the Board for the upcoming plan year. For the 2017 plan year, the employer rate was approximately 85% of the total health insurance cost for eligible retirees and the retiree rate was approximately 15%. With regard to life insurance, the employer covers the total premium cost for $25,000 of basic life insurance. If an individual elects to have supplemental, and/or, dependent life insurance coverage, such costs are borne entirely by the retiree.

For fiscal year 2017, the University System of Georgia contributed $99,583,903 to the plan for current premiums or claims.

Investments The Plan's investments are segregated for OPEB in the Board of Regents' Short-Term and Balanced Income pooled investment funds.

The Short-Term Fund provides a current return and stability of principal while affording a means of overnight liquidity for projected cash needs. Investments are in securities allowed under Georgia Code 50-17-59 and 50-17-63. The average maturities of investments in this fund will typically range between daily and three years, and the fund will typically have an overall average duration of - 1 year. The overall character of the portfolio is of Agency quality, possessing a minimal degree of financial risk. The market value of the Plan's net asset value in the Short Term Fund at June 30, 2017 was $377,029. This balance is reported as cash and cash equivalents on the Statement of Fiduciary Net Position.

The Balanced Income Fund is designed to be a vehicle to invest funds that are not subject to the state regulations concerning investing in equities. This pool is appropriate for investing longer term funds that require a more conservative investment strategy. Permitted investments in the fund are domestic US equities, domestic investment grade fixed income, and cash equivalents. The equity allocation shall range between 30% and 40%, with a target of 35% of the total portfolio. The fixed income (bond) portion of the portfolio shall range between 60% and 70%, with a target of 65% of the total portfolio. Cash reserves and excess income are invested at all times in the highest quality par stable (A1, P1) institutional money market mutual funds, or other high quality short term instruments. The market value of the Plan's net asset value in the Balanced Income Fund at June 30, 2017 was $7,101,556. This balance is reported as pooled investments on the Statement of Fiduciary Net Position.

The following table summarizes the adopted asset allocation policy as of June 30, 2017:

Asset Class Cash Equivalents Fixed Income Equity Allocation

Target Allocation Less than 5% 60% to 70% 30% to 40%

At June 30, 2017, approximately 28.34%, 24.86%, 11.99%, 9.42%, 6.17%, 5.89% and 5.69% of the Plan's investments were investments in iShares Core Total U.S. Aggregate Bond ETF, Western Asset Core Bond Portfolio, Vanguard Institutional Index Fund, DFA Short-Term Extended Quality, Federated Money Mkt Obligations Treasury, iShares Russell 1000 Growth ETF, and iShares Russell 1000 Value ETF, respectively.
For the year ended June 30, 2017, the annual money-weighted rate of return on investments, net of investment expense, was .99%. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested.
Annual OPEB Cost and Net OPEB Obligation under GASB 45 The annual OPEB cost (expense) (AOC) for the Plan is calculated based on the annual required contribution (ARC) of the employer, an amount actuarially determined in accordance with the parameters of GASB Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period not to exceed 30 years.

98 University System of Georgia

The following table presents the components of the USG's annual OPEB cost, the amount actually contributed, and changes in the net OPEB obligation (NOO) for the Plan for fiscal year 2017, 2016, and 2015 (dollars in millions):

Annual Required Contribution Interest on Net OPEB Obligation (NOO) Amortization of NOO
Total Expense or Annual OPEB Cost (AOC) Actual Contribution Towards OPEB Cost
Increase in NOO Net OPEB Obligation, Beginning of Year Net OPEB Obligation, End of Year

Fiscal Year Ending June 30

2017

2016

2015

$

349.9 $

295.2 $

442.4

106.0

97.3

82.9

(96.1)

(88.2)

(75.2)

359.8

304.3

450.1

(99.6)

(111.8)

(129.8)

260.2

192.5

320.3

2,355.9

2,163.4

1,843.1

$

2,616.1 $

2,355.9 $

2,163.4

The USG's annual OPEB cost, the percentage of annual OPEB cost contributed to the Plan and the net OPEB obligation for the Retiree Health Benefit Plan were as follows (dollars in millions):

Fiscal Year Ended 2015 2016* 2017

Annual OPEB Cost

Contribution

Percentage of Annual OPEB Cost
Contributed

$

450.1 $

129.8

28.8%

$

$

304.3 $

111.8

36.7%

$

$

359.8 $

99.6

27.7%

$

Net OPEB Obligation
2,163.4
2,355.9
2,616.1

* Changes in Plan Provisions: Effective January 1, 2016, all post-65 Medicare eligible retirees access medical coverage through an individual Healthcare Exchange marketplace. The University System of Georgia provides an annual fixed dollar HRA contribution for these retirees.

The funded status of the plan as of the latest actuarial valuation date was as follows:

Actuarial Valuation
Date
7/1/2016

Actuarial Value of Assets
(a)
$ 2,898,502

Actuarial Accrued Liability
(AAL) Projected Unit
Credit
(b)
$ 3,068,725,854

Unfunded AAL (UAAL)
(b-a)
$ 3,065,827,352

Funded Ratio

Annual Covered Payroll

(a/b)

(c)

0.1% $ 2,855,308,903

UAAL as a Percentage of
Covered Payroll
((b-a)/c)
107.4%

Net OBEB Liability under GASB 74 For defined benefit OPEB plans that are administered through trusts that meet the specified criteria, GASB 74 requires the net OPEB liability to be measured as the total OPEB liability, less the amount of the OPEB plan's fiduciary net position. The total OPEB liability is actuarially determined.
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trends. Actuarially determined amounts are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress with multi-year trend information is presented as required supplementary information following the notes to the financial statements.
The multi-year trend schedules indicate whether the actuarial values of plan assets are increasing or decreasing over time relative to the actuarial accrued liabilities for benefits.
2017 Annual Financial Report 99

The components of the net OPEB liability at June 30, 2017, were as follows:

Total OPEB Liability Plan Fiduciary Net Position Net OPEB Liability

$ 4,227,583,095 7,857,223
$ 4,219,725,872

Plan Fiduciary Net Position as a Percentage of the Total OPEB Liability

0.19%

Discount Rate The last year in which projected benefit payments are due from the Plan is 2115.
The long-term expected rate of return on OPEB plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the target asset allocation as of June 30, 2017 are summarized in the following table:

Asset Class Cash Equivalents Fixed Income
Domestic Fixed Income (Corporate Long Term) Domestic Fixed Income (Corporate Short Term) International Fixed Income Equity Allocation Domestic Equity (Large Cap) International Equity

Expected Return 2.6%
4.2% 3.5% 4.9%
6.5% 7.3%

The Plan's projected fiduciary net position at the end of 2018 is $0, based on the valuation completed for the fiscal year ending June 30, 2017. As such, the Plan's fiduciary net position was not projected to be available to make all projected future benefit payments for current Plan members. The projected "depletion date" when projected benefits are not covered by projected assets is 2018. Therefore, the long-term expected rate of return on Plan investments of 4.50% per annum was not applied to all periods of projected benefit payments to determine the total OPEB liability as of June 30, 2017, pursuant to paragraph 48 of GASB Statement No. 74. Instead, a yield or index rate for a 20 year, tax-exempt general obligation municipal bond with an average rating of AA or higher was used. This rate was determined to be 3.58% from the Bond Buyer.
In projecting the Plan's fiduciary net position, the following assumptions were made:
1. Projected total contributions are simply the pay as you go costs of the plan. Because the current contribution policy is not designed to pre-fund the plan, the unfunded liability is not expected to be paid off at any point in the future.
2. Assumed contributions are based on the contribution policy.
3. Projected benefit payments have been determined in accordance with Paragraphs 30-35 of GASB Statement No. 74, and are based on the closed group of active, retired members and beneficiaries as of June 30, 2017. Benefit payments are assumed to be paid mid-year.
4. Administrative expenses are $0.0 million for 2017. Expenses are assumed to be paid mid-year.
5. Projected investment earnings are based on the assumed investment rate of return of 4.50% per annum. The first year's earnings have been adjusted to account for the actual return through June 30, 2017.
100 University System of Georgia

Sensitivity of the net OPEB liability to changes in the discount rate The following presents the net OPEB liability , as well as what the net OPEB liability would be if it were calculated using a discount rate that is 1% lower (2.58%) or 1% higher (4.58%) than the current discount rate (3.58%):

Net OPEB Liability

1% Decrease 2.58%
$ 5,040,938,351 $

Current Rate 3.58% 4,219,725,872 $

1% Increase 4.58% 3,579,534,581

Sensitivity of the net OPEB liability to changes in the healthcare cost trend rates The following presents the net OPEB liability, as well as what the net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1% lower or 1% higher than the current healthcare cost trend rates:

Net OPEB Liability

1% Decrease

$

3,559,505,220 $

Current Rate 4,219,725,872 $

1% Increase 5,091,997,068

Pre-Medicare Eligible Medicare Eligible

6.3% decreasing to 3.5% 7.3% decreasing to 4.5% 8.3% decreasing to 5.5% 6.3% decreasing to 3.7% 7.3% decreasing to 4.7% 8.3% decreasing to 5.7%

Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the substantive plan (plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and Plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations.

2017 Annual Financial Report 101

Additional information as of the latest actuarial valuation is as follows:

Valuation Date Cost Method
Amortization Method
Asset Method Interest Discounting and Salary Growth
Mortality Rates
Initial Healthcare Cost Trend Pre-Medicare Eligible Medicare Eligible
Ultimate Trend Rate Pre-Medicare Eligible Medicare Eligible
Year Ultimate Trend is Reached Experience Study

July 1, 2016. Update procedures were used to rolled forward the total OPEB liability to June 30, 2017. GASB 45 - Projected Unit Credit
GASB 74 - Entry Age Normal GASB 45 - Past service liability is amortized over a closed 30 year period, as a percent of payroll.
GASB 74 - Closed amortization period for initial unfunded and subsequent actuarial gains/losses.
Fair Value GASB 45 Interest Rate 4.50% GASB 74 Interest Rate as of 6/30/2016 2.85% from Bond Buyer GASB 74 Interest Rate as of 6/30/2017 3.58% from Bond Buyer General Inflation 2.50% Salary Growth 3.00% Salary Scale 4.00% Healthy: RP-2014 Mortality Table with Generational Improvements by Scale MP-2014
Disabled: RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females)
7.3% 7.3%
4.5% 4.7% 2031 for Pre-Medicare Eligible, 2072 for Medicare Eligible Based on the experience of the Teachers Retirement System of Georgia

Changes in Assumptions Since Prior Valuation
Expected claims costs were updated to reflect actual claims experience. Trend was reset based on current conditions. Disability, Termination, Retirement, and Disabled Mortality were updated to reflect the current Teachers Retirement System of Georgia.

102 University System of Georgia

Note 18 Operating Expenses with Functional Classifications

Business-type activity operating expenses by functional classification for fiscal 2017 are shown below:

Functional Classification
Instruction Research Public Service Academic Support Student Services Institutional Support Plant Operations and Maintenance Scholarships and Fellowships Auxiliary Enterprises Patient Care
Total Operating Expenses

Faculty Salaries

Staff Salaries

Natural Classification
Employee Benefits

Personal Services

$ 987,783,959 $ 326,051,593 $ 402,776,174 $

443,459,433

306,270,212

177,470,440

40,691,784

144,142,855

59,564,862

56,821,160

259,530,850

97,329,406

3,374,277

178,409,388

53,707,094

11,427,797

327,618,938

181,623,831

409,070

197,111,716

76,938,644

55,000

65,721

203,645

817,759

208,978,679

57,424,130

73,692,728

109,424,773

43,957,866

1,350,253 $ 261,428 681,108 784,569 324,768
7,980,934 --
655,777 3,330,302

$ 1,618,532,967 $ 2,057,604,725 $ 1,150,996,092 $ 15,369,139 $

Travel 20,332,903 30,486,609
6,658,262 6,532,328 4,341,170 6,281,265
849,631
2,704,938 410,018
78,597,124

Functional Classification
Instruction Research Public Service Academic Support Student Services Institutional Support Plant Operations and Maintenance Scholarships and Fellowships Auxiliary Enterprises Patient Care
Total Operating Expenses

Scholarships and Fellowships

Utilities

Natural Classification
Supplies and Other Services

Depreciation/ Amortization

Total Operating Expenses

$ 13,737,188 $

5,296,312 $ 168,688,851 $ 70,460,942 $ 1,996,478,175

6,478,109

5,329,697

316,359,109

85,069,151

1,371,184,188

1,918,973

2,860,401

154,855,791

8,410,222

419,784,258

925,243

3,325,353

127,059,867

56,054,907

608,363,683

3,894,178

3,181,468

85,631,058

21,893,082

354,756,483

2,617,941

8,088,009

591,691,204

35,932,481

1,173,262,400

--

112,652,978

180,500,645

82,952,960

651,415,644

253,473,818

438,932

2,564

254,895,457

30,326,846

35,470,653

364,926,888

125,040,205

829,020,400

392,353

125,129,980

353,007,718

$ 313,372,296 $ 176,597,224 $ 2,115,282,325 $ 485,816,514 $ 8,012,168,406

Note 19 Subsequent Event
On August 30, 2017, the Georgia State University Foundation refunded existing bonds associated with the Panther Place, LLC Series 2009 A & B bonds by a new fixed-rate bond issuance. Revenue bonds of $57,040,000 (tax-exempt $49,270,000 and taxable $7,770,000) plus premium of $6,474,607 were issued by the Atlanta Development Authority on behalf of the Georgia State University Foundation. Capital leases between the Georgia State University Foundation and Georgia State University associated with this debt were restructured to provide net savings to the Georgia State University of $26,277,546.
On August 30, 2017, the Georgia State University Foundation refunded existing bonds associated with the GPC Foundation Real Estate Newton, LLC Series 2005 bonds by a new fixed-rate bond issuance. Tax-exempt Revenue bonds of $15,865,000 plus premium of $1,954,062 were issued by the Newton County Industrial Development Authority on behalf of the Georgia State University Foundation. Capital leases between the Georgia State University Foundation and Georgia State University associated with this debt were restructured to provide net savings to the Georgia State University of $4,170,496.

2017 Annual Financial Report 103

On September 25, 2017, the University of Georgia, an organizational unit of the USG, paid $21,167,039 to the UGA Real Estate Foundation Coverdell Building, LLC for the extinguishment of debt, transfer of the facility to the Institution, and early termination of the air rights lease and capital lease agreement related the Paul D. Coverdell Center for Biomedical and Health Sciences.
In December 2017, the Board of Regents of the University System of Georgia (BOR), on behalf of the Georgia Institute of Technology, entered into a lease agreement with Georgia Tech Cobb Research Campus, LLC, a wholly-owned subsidiary of Georgia Advanced Technology Ventures (GATV) for the Georgia Tech Cobb Research Campus. This facility will be used by the Georgia Tech Research Institute (GTRI) for ongoing research. The lease term is for thirtyone and one half years with rental payments beginning in December 2017. The Institute will pay estimated total rent on a monthly basis of $127,863,834 over the thirty year period. The rental payment includes annual base rent and annual repair and replacement contribution. Total rental payments for the first year are expected to equal $1,170,055.
In December 2017, the USG Real Estate V, LLC purchased the SGSC Tiger Village I (student housing dormitory), Tiger Village 2 (student housing dormitory), Clower Hall (student center) and dining hall and related amenities from the South Georgia State College Foundation for $31,000,000 by issuing a two year interest-only bond anticipation note ("BAN") payable. At maturity, the BAN payable will be refinanced with a 30 year low-interest fixed rate USDA loan. The real estate on which the facilities are constructed will be leased to USG Real Estate Foundation, LLC by the Board of Regents pursuant to a ground lease for minimal rent. The terms of the BAN payable require the USG Real Estate Foundation V, LLC to lease the related facilities to the Board of Regents through year-to-year rental agreements that have multiple-year renewal options, in amounts necessary to maintain the properties, pay interest on the note, and retire the debt. Through the rental agreement with the USG Real Estate Foundation, South Georgia State College will realize a savings of $5.1 million over the life of the agreement.
Note 20 Component Units
Augusta University Foundation, Inc. The Augusta University Foundation (AUF) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
The AUF acts primarily as a fund-raising organization to supplement the resources that are available to Augusta University in support of its programs. During the year ended June 30, 2017, the AUF distributed approximately $993,566 to Augusta University in support of capital outlay projects, scholarships and other supporting activities.
Augusta University Research Institute, Inc. Augusta University Research Institute (AURI) is a legally separate, tax-exempt component unit of the State of Georgia reporting entity. The AURI serves to enhance the research mission of Augusta University by securing sponsored research funding and by providing funding of special research initiatives. During the year ended June 30, 2017, the AURI distributed approximately $59,758,599 million to Augusta University in support of capital outlay projects, scholarships and other supporting activities.
AU Health System Inc AU Health System, Inc. (the Health System), located in Augusta, Georgia, is a legally separate, tax-exempt organization, which was established to promote the health science education missions and other tax-exempt functions and purposes of the Augusta University (the University), AU Medical Associates (AUMA) and AU Medical Center, Inc. (AUMC), by strategically coordinating operations of AUMA and AUMC. The Health System was incorporated under the laws of the State of Georgia as a non-profit corporation on June 1, 2010. It began operations on June 1, 2010 as part of a Joint Operating Agreement (the Agreement) with AUMA and AUMC. The Agreement was subsequently amended on June 26, 2014 to incorporate Roosevelt Warm Springs Rehabilitation & Specialty Hospitals, Inc. (RWSH) (a discretely presented component unit) and on August 28, 2014 to incorporate AU Health Professions Associates, Inc. (Health Professions Associates), Augusta University Nursing Associates, Inc. (Nursing Associates) and AU - Dental Associates (Dental Associates).
AU Medical Associates AU Medical Associates (the Company), was formed in 1958 as a nonprofit organization for the purpose of enhancing the clinical, research, and educational missions of the Augusta University (AU or the University) and billing and collecting
104 University System of Georgia

for medical services provided to patients. Revenues are obtained primarily from physician fees charged to patients at AU Medical Center and AU Children's Medical Center, which are operated by AU Health System, Inc.
Georgia Advanced Technology Ventures, Inc. The Georgia Advanced Technology Ventures (GTAV) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
GATV is a supporting organization of the Georgia Institute of Technology focused on technology, commercialization, economic development, and relevant real estate development. During the year ended June 30, 2017, GATV distributed approximately $309,000 to the Georgia Institute of Technology in support of other supporting activities.
Georgia College & State University Foundation The Georgia College & State University Foundation (GC&SUF) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
The GC&SUF acts primarily as a fund-raising organization to supplement the resources that are available to the Georgia College & State University in support of its programs. During the year ended June 30, 2017, the GC&SUF distributed approximately $744,748 to Georgia College & State University in support of capital outlay projects, scholarships and other supporting activities.
Georgia Gwinnett College Foundation, Inc. Georgia Gwinnett College Foundation, Inc. was established on May 8, 2006 to serve as an advocate for Georgia Gwinnett College, a unit of the University System of Georgia.
The Foundation's primary object is to receive, invest, account for, and allocate private gifts and contributions in support of the College.
Georgia Health Sciences Foundation, Inc. The Georgia Health Sciences Foundation (GHSF) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
The GHSF acts primarily as a fund-raising organization to supplement the resources that are available to Augusta University in support of its programs. During the year ended June 30, 2017, the GHSF distributed approximately $3,872,387 to Augusta University in support of capital outlay projects, scholarships and other supporting activities.
Georgia Southern Housing Foundation, Inc. The Georgia Southern University Housing Foundation, Inc. is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
Georgia Southern University Foundation, Inc. and Subsidiaries (GSUHF) is a legally separate, tax-exempt affiliated organization which supports Georgia Southern University (University). GSUHF acts primarily as an organization to issue bonds which are utilized to acquire and/or construct student housing and other student facilities that are available to the University in support of its programs. The board of the GSUHF is self-perpetuating and consists of employees and friends of the University. Because the organization's purpose is for the benefit of the University, the Foundation is considered a component unit of the State of Georgia reporting entity and is discretely presented in these financial statements.
2017 Annual Financial Report 105

Georgia State University Foundation, Inc. The Georgia State University Foundation, Inc. (GSUF) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
The GSUF acts primarily as a fund-raising organization to supplement the resources that are available to the Georgia State University in support of its programs. During the year ended June 30, 2017, the GSUF distributed approximately $16.8 million to Georgia State University in support of capital outlay projects, scholarships and other supporting activities.
Georgia State University Research Foundation Inc. and Affiliates The Georgia State University Research Foundation (GSURF) is a legally separate, tax-exempt component unit of the State of Georgia reporting entity. The GSURF functions as the prime contractor for most sponsored research conducted at Georgia State University and subcontracts with Georgia State University for faculty and staff services. During the year ended June 30, 2017, the GSURF distributed approximately $89 million to the university for restricted and unrestricted grants and contract sub-awarded to Georgia State University.
Georgia Tech Athletic Association The Georgia Tech Athletic Association (GTAA) administers Georgia Institute of Technology's intercollegiate athletics program, including fund-raising to support scholarships. During the year ended June 30, 2017, the GTAA distributed approximately $11 million to the Georgia Institute of Technology for athletic scholarship support and other payments that were either expense reimbursements or support for Georgia Institute of Technology's intercollegiate athletics program.
Georgia Tech Facilities, Inc. The Georgia Tech Facilities, Inc. (GTFI) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
Additionally, the FASB reported Investment in Direct Financing Leases and Net Position was increased by $50,226,993 for external financial reporting purposes in these financial statements. This adjustment was necessary as GTFI amortizes Investment in Direct Financing Leases on a straight-line method.
GTFI constructs buildings and other facilities as appropriate to meet the needs and goals of the Georgia Institute of Technology. Funding for construction is obtained from contributions or from financing with debt service funded by support from various sources. During the year ended June 30, 2017, GTFI distributed approximately $344,000 to the Georgia Institute of Technology for supporting activities.
Georgia Tech Foundation, Inc. The Georgia Tech Foundation (GTF) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
Additionally, the FASB reported Investment in Direct Financing Leases and Net Position was increased by $21,663,000 for external financial reporting purposes in these financial statements. This adjustment was necessary to properly reflect these balances in accordance with GAAP. The GTF amortizes Investment in Direct Financing Leases on a straight-line method, whereas, GAAP requires the effective interest method be utilized.
The GTF acts primarily as a fund-raising organization to supplement the resources that are available to the Georgia Institute of Technology in support of its programs. During the year ended June 30, 2017, the GTF distributed approximately $84 million to Georgia Institute of Technology in support of capital outlay projects, scholarships and other supporting activities.
106 University System of Georgia

Georgia Tech Research Corporation Georgia Tech Research Corporation (GTRC) is a legally separate, tax-exempt component unit of the State of Georgia reporting entity. GTRC functions as the prime contractor for most sponsored research conducted at Georgia Institute of Technology and subcontracts with Georgia Institute of Technology for faculty and staff services. During the year ended June 30, 2017, the GTRC distributed approximately $682 million to Georgia Institute of Technology for restricted and unrestricted grants and contracts sub-awarded to Georgia Institute of Technology.
Kennesaw State University Athletic Association, Inc. The Kennesaw State University Athletic Association (KSUAA) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
The KSUAA administers Kennesaw State University's intercollegiate athletics program, including fund-raising to support scholarships. During the year ended June 30, 2017, the KSUAA distributed approximately $11,470,000 million to Kennesaw State University for services such as food services, parking services, health services, tuition, gas, electricity, and security.
Kennesaw State University Foundation, Inc. The Kennesaw State University Foundation (KSUF) is a private nonprofit organization that reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
The KSUF acts primarily as a fund-raising organization to supplement the resources that are available to the Kennesaw State University in support of its programs. During the year ended June 30, 2017, the KSUF distributed approximately $4,110,822 to Kennesaw State University in support of capital outlay projects, scholarships and other supporting activities.
Medical College of Georgia Foundation Medical College of Georgia Foundation, Inc. (the "Foundation") is a nonprofit corporation incorporated under the laws of the State of Georgia in 1954. The Foundation serves the needs and interests of Augusta University, the Augusta University Health Sciences campus and the Augusta University Health System. The Foundation presents its financial statements in accordance with Financial Accounting Standards Board (FASB). As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
The Foundation receives and administers funds for the support of Augusta University, the Augusta University Health Sciences campus and the Augusta University Health System, and manages investments and distributes funds in accordance with donor instructions and board of director's intentions for gifts. The Foundation provides support for faculty chairs, research, scholarships and other institutional programs. During the year ended June 30, 2017, the Foundation paid approximately $3,450,000 to Augusta University and its affiliates in support of students and University programs. The Foundation paid approximately $6,260,000 to non-affiliated organizations on behalf of Augusta University.
Middle Georgia State University Real Estate Foundation, Inc. The Middle Georgia State University Real Estate Foundation (MGAREF) is a nonprofit corporation originally incorporated on August 31, 1973 for the purpose of promoting, in various ways, the cause for higher education, expanding educational opportunities, supporting athletic programs, and acquiring and administering funds to be used to award scholarships and create endowments for the benefit of students and faculty of the University. The Foundation was restructured on February 25, 2013 to acquire, construct, supervise, administer and manage assets and properties, real and personal that are held and used exclusively for the benefit of the University.
2017 Annual Financial Report 107

University of Georgia Athletic Association, Inc. The University of Georgia Athletic Association, Inc. (the Athletic Association) is a legally separate, tax-exempt component unit of the State of Georgia reporting entity. The Athletic Association was organized in 1938 as a not-for-profit corporation to promote intercollegiate athletic sports representing the Institution. Although University of Georgia is not fiscally accountable for the Athletic Association, the nature and significance of the relationship between the University and the Athletic Association is such that exclusion from these departmental financial statements would render them misleading.
During the year ended June 30, 2017, the Athletic Association made payments to the University for services such as food services, parking services, health services, tuition, gas, electricity, security, and golf course maintenance. These payments totaled $50.1 million.
University of Georgia Foundation The University of Georgia Foundation (the UGA Foundation) is a not for profit foundation that was chartered in 1937 to receive and administer contributions for the support of the academic programs of the University of Georgia (the Institution). The Foundation reports under FASB standards. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. The FASB reports were reclassified to the GASB presentation for external financial reporting purposes in these financial statements.
During the year ended June 30, 2017, the UGA Foundation distributed $38.1 million to the Institution for both restricted and unrestricted purposes.
University of Georgia Research Foundation, Inc. The University of Georgia Research Foundation (the Research Foundation) is a legally separate, tax-exempt affiliated organization of the University of Georgia (University). The Research Foundation serves to enhance the research mission of the University by securing sponsored research funding and by providing funding of special research initiatives. All University intellectual property developed through these research programs is managed by the Research Foundation. The seventeen-member board of the Research Foundation consists of designated University personnel, appointees of several University constituent groups, and individuals selected by the Research Foundation itself. All sponsored research awards are subcontracted to the University and other resources and related income are used to benefit the teaching, research, and outreach missions of the University.
The Research Foundation is considered a special-purpose government entity engaged only in business-type activities and is required to follow all applicable GASB pronouncements. The Research Foundation's fiscal year is July 1 through June 30.
Complete financial statements for the Research Foundation can be obtained from the University of Georgia, University Business and Account Services, 324 Business Services Building, 456 East Broad Street, Athens, GA 30602.
The Research Foundation includes one component unit; the UGA Real Estate Foundation, Inc. (the Real Estate Foundation). The Research Foundation is the sole corporate member of the Real Estate Foundation and its activities are included in the financial statements using a blended presentation. The Real Estate Foundation manages and improves various real estate assets for the benefit of the University. The Real Estate Foundation may also provide support to the Board of Regents of the University System of Georgia and its affiliated institutions.
University of North Georgia Real Estate Foundation, Inc. The University of North Georgia Real Estate Foundation, Inc. and subsidiaries, is a nonprofit foundation exempt from federal and state income taxes under Internal Revenue Code Section 501(c)(3). The Real Estate Foundation was formed and incorporated under the laws of the state of Georgia in July 2009. The purpose of the Real Estate Foundation is to serve the needs and interest of the University of North Georgia and to benefit and promote the well-being of its administration, faculty, staff, student body, and the people and communities served by the University; and to acquire, lease, receive, accept, develop, manage, encumber, assign, sell, transfer and convey real property to be administered exclusively for charitable purposes for the benefit of the University of North Georgia.
108 University System of Georgia

UWG Real Estate Foundation, Inc. UWG Real Estate Foundation, Inc. (Foundation) is a legally separate, tax-exempt component unit of the State of Georgia reporting entity. The Foundation constructs research and auxiliary buildings and facilities for use by the University of West Georgia and then leases the completed buildings to the University. The nine-member board of the Foundation is self-perpetuating and consists of graduates and friends of the University. Although the University does not control the timing or amount of receipts from the Foundation, the majority of resources or income thereon that the Foundation holds and invests is restricted to real estate activities of the University. These restricted resources held by the Foundation can only be used by or for the benefit of the University.
The UWG REF acts primarily as a fund-raising organization to supplement the resources that are available to the University of West Georgia in support of its programs. During the year ended June 30, 2017, the UWG REF distributed approximately $591,230 to University of West Georgia in support of capital outlay projects, scholarships and other supporting activities.
University System of Georgia Foundation, Inc. and Affiliates The University System of Georgia Foundation, Inc. (the "Foundation") is a nonprofit foundation exempt from federal and state income taxes under Internal Revenue Code Section 501(c)(3), and was formed on August 10, 1995. The Foundation was organized and operates under the laws of the State of Georgia to serve the needs and interests of the University System of Georgia.
The University System of Georgia Foundation, Inc. is a cooperative organization of the Board of Regents of the University System of Georgia. Its mission is to advance the University System of Georgia, as a whole, consistent with the priorities determined by the University System of Georgia Foundation, Inc. Board of Trustees. The Foundation's support comes primarily from contributions and grants from individuals and corporations, and from leasing activities within the University System of Georgia. During the fiscal year, the Foundation gave $1.5 million in scholarships to various foundation supporting units of the USG.
VSU Auxiliary Services Real Estate Foundation The VSU Auxiliary Services Real Estate Foundation is a Georgia nonprofit corporation, located in Valdosta, Georgia, incorporated on January 24, 2007. The Foundation is managed by a board of trustees. The Foundation is the sole owner of various limited liability companies: VSU Auxiliary Services Real Estate-Hopper, LLC, VSU Auxiliary Services Real Estate Foundation-Parking & Health, LLC, VSU Auxiliary Services Real Estate Georgia & Reade, LLC, VSU Auxiliary Services Real Estate-Student Union, LLC, VSU Auxiliary Services Real Estate-Centennial, Lowndes & Patterson, LLC and VSU Auxiliary Services Real Estate-Acquisition, LLC.
The Foundation was organized to support Valdosta State University ("the University") in its mission to provide excellent higher education to its constituencies, and to provide broad advice, consultation and support to the President of the University. The Foundation's primary efforts are directed toward developing the University's facilities and infrastructure as identified in the strategic planning process and the master plan of the University. In addition, the Foundation may provide such services as administration of assets, advice, consultation and support to the Board of Regents and the colleges and universities of the University System of Georgia ("the Board of Regents") and their affiliated support organizations. The Foundation year end is December 31st.
2017 Annual Financial Report 109

Combined component unit's investments are comprised of the following amounts at June 30, 2017:

U.S. Treasuries U.S. Agencies
Explicitly Guaranteed Implicitly Guaranteed Bond Securities Corporate Debt Money Market Mutual Funds Municipal Obligations Mutual Bond Funds Certificates of Deposits Repurchase Agreements Equity Mutual Funds - Domestic Equity Mutual Funds - International Equity Securities - Domestic Equity Securities - International Real Estate Held for Investment Purposes Real Estate Investment Trusts Natural Resources Split Interest Investments Hedge Funds Commodity Fund Certificates of Deposit Other Investments Joint Ventures/Partnerships Diversifying Strategies Pooled Investments Alternative Investments Private Equities High Yield Bonds Closely Held Stock Partnership - Real Estate Outside Managed Investments Money Market Funds Equity ETF Accrued Interest & Dividends Venture Capital Other Equity Managed Futures/Hedge Funds

Fair Value

$

162,089,963 $

2,293,517 22,255,174 239,968,363 67,475,825 100,081,161 11,076,104 87,709,222
5,594,706 47,350,957 146,224,095 308,375,369 508,057,223 398,700,799 61,225,402 71,630,661 143,293,226
1,906,300 697,987,566
32,695,661 1,136,192

164,327,133 7,288,800 296,720 803,246
260,153,102 544,219 38,311
21,655,298 5,455,310 20,342 1,956,826 587,426 249,667 128 7,529,226

Level 1
116,822,301 $
-- 13,558,563 134,225,062
3,030,453 98,003,999
-- 23,874,374
5,594,706 16,775,917 92,183,466 283,622,602 507,727,223 363,970,799
-- 25,269,110 33,755,334
-- 28,656,820 26,361,345
1,136,192
308,921 -- -- -- --
544,219 -- -- --
20,342 1,956,826
587,426 -- -- --

Fair Value Hierarchy

Level 2

Level 3

45,267,662

--

2,293,517 8,696,611 56,906,301 64,445,372 2,077,162 11,076,104 63,834,848
-- 30,575,040
3,567,504 -- -- -- --$
8,762,276 --
1,906,300 --
6,334,316 --

-- -- --$ -- -- -- -- -- -- -- -- -- -- 61,225,402 -- 16,741,191 -- -- -- --

-- -- 296,720 -- -- -- -- -- 5,053,189 -- -- -- 249,667 -- --

109,088,470 -- --
803,246 -- --
38,311 --
402,121 -- -- -- --
128 --

NAV
--
-- -- 48,837,000 -- -- -- -- -- -- 50,473,125 24,752,767 330,000 34,730,000 -- 37,599,275 92,796,701 -- 669,330,746 -- --
54,929,742 7,288,800 -- --
260,153,102 -- --
21,655,298 -- -- -- -- -- --
7,529,226

Investment Pools Board of Regents Short-Term Fund Legal Fund Balanced Income Fund Total Return Fund Diversified Fund for Foundations Office of the State Treasurer Georgia Fund 1 Other Pools
Total Investments

3,588,033,240 $

1,777,986,000 $

311,342,589 $

188,298,869 $

1,310,405,782

75,901,716 551,799
6,522,592 443,688
18,401,086

278,700 27,470

$

3,690,160,291

Component unit investments of $97,512,605 are reported as cash and cash equivalents on the Statement of Net Position.
Component unit's noncurrent cash and cash equivalents are restricted assets limited as to use.

110 University System of Georgia

Combined component unit's endowments are comprised of the following amounts at June 30, 2017:

Beginning Contributions Net realized and unrealized gains Appropriation of endowment assets for expenditure Transfers to comply with donor intent Other
Ending

Unrestricted/ Quasi
Endowment

Temporarily

Permanently

Restricted/

Restricted/

Term Endowment True Endowment

Total

$ 309,479,865 $ 805,609,072 $ 1,378,046,056 $ 2,493,134,993

9,408,349

4,793,193

98,375,061

112,576,603

49,158,701

244,863,853

8,176,540

302,199,094

(9,937,653)

(84,402,916)

(4,511,763)

(98,852,332)

8,519,606

(8,947,023)

(11,037,418)

(11,464,835)

5,913,039

9,284,675

3,569,933

18,767,647

$ 372,541,907 $ 971,200,854 $ 1,472,618,409 $ 2,816,361,170

Combined amounts due to component units related to direct financing lease activity as of June 30, 2017 is as follows:

Year Ending June 30:

Year:

2018

1

$

2019

2

2020

3

2021

4

2022

5

2023 through 2027

6-10

2028 through 2032

11-15

2033 through 2037

16-20

2038 through 2042

21-25

2043 through 2047

26-30

Total Minimum Lease Payments to be Received

Less: Unearned Income

Net Investment in Direct Financing Lease Receivable

$

Total
191,849,143 194,285,989 193,673,144 195,232,147 195,865,677 1,108,010,770 884,157,900 644,776,070 276,002,224
3,501,086 3,887,354,150 (1,544,268,482) 2,343,085,668

Combined component unit's capital assets are comprised of the following amounts at June 30, 2017:

Capital Assets not being Depreciated: Land and Land Improvements Capitalized Collections Construction Work-in-Progress
Total Capital Assets not being Depreciated

$

134,681,156

3,117,193

54,287,062

192,085,411

Capital Assets being Depreciated: Buildings and Building Improvements Improvements other then Buildings Infrastructure Machinery and Equipment Software
Total Capital Assets being Depreciated/Amortized

955,952,404 210,857,690
5,516,695 304,602,864
32,057,651 1,508,987,304

Less Total Accumulated Depreciation/Amortization

588,729,867

Total Capital Assets being Depreciated/Amortized, Net

920,257,437

Capital Assets, Net

$

1,112,342,848

2017 Annual Financial Report 111

Combined component unit's long-term liabilities are comprised of the following amounts at June 30, 2017:

Beginning Balance

Additions

Reductions

Ending Balance

Amounts due within One Year

Claims and Judgments Compensated Absences Lease Purchase Obligation (Capital Lease) Liabilities under Split Interest Agreement Notes and Loans Payable Note (Discount)/Cost of Issuance Interest Rate Swap Other Post Employment Benefits Obligation Pollution Remediation Revenue/Mortgage Bonds Payable Unamortized Issuance and Other Bond Related Costs Bond - Premium Bond - (Discount)

$ 3,720,756 $ 17,252,869
102,941,792 27,784,893
127,691,899 (14,903)
88,204,401 5,274,929 660,000
3,082,202,041
(65,134,041) 92,849,192 (10,419,225)

81,112 $ 6,854,418 7,274,894 2,615,074 144,933,606
-- -- 6,256,863 -- 447,509,700
6,943,523 48,638,863
(313,134)

1,575,564 4,915,180 18,015,571 1,279,837 67,821,342
973,286 30,347,053
-- 58,659 497,558,249

$ 2,226,304 $ 19,192,107 92,201,115 29,120,130
204,804,163 (988,189)
57,857,348 11,531,792
601,341 3,032,153,492

(2,864,525) 10,393,298 (1,180,784)

(55,325,993) 131,094,757
(9,551,575)

1,575,564 19,192,107
8,475,621 2,488,373 40,967,360
-- 5,619,975
-- 601,341 85,371,263
(1,712,994) 798,768 (16,212)

Total Long Term Liabilities

$ 3,473,014,603 $ 670,794,919 $ 628,892,730 $ 3,514,916,792 $ 163,361,166

Combined component unit's capital lease obligations are comprised of the following amounts at June 30, 2017:

Year ending June 30: 2018 2019 2020 2021 2022 2023 through 2027 2028 through 2032 2033 through 2037
Total minimum lease payments Less: Interest
Principal Outstanding

1

$

2

3

4

5

6-10

11-15

16-20

$

13,326,240 12,908,747 11,802,255 10,383,897
9,425,571 32,274,716 27,928,119 10,518,184 128,567,729 36,366,614 92,201,115

Combined component unit's notes and loans are comprised of the following amounts at June 30, 2017:

Year ending June 30: 2018 2019 2020 2021 2022 2023 through 2027 2028 through 2032 2033 through 2037 2038 through 2042
Note (Discount)/Cost of Issuance Total

Principal

1

$

2

3

4

5

6-10

11-15

16-20

21-25

$

40,967,360 $ 91,240,811
4,142,378 3,143,130 3,251,784 50,223,163 6,233,536 4,210,606 1,391,395 204,804,163 (988,189) 203,815,974 $

Interest
4,062,125 $ 4,011,758 3,195,193 3,077,548 2,977,811 6,638,504 1,761,915
586,540 54,973
26,366,367 --
26,366,367 $

Total
45,029,485 95,252,569
7,337,571 6,220,678 6,229,595 56,861,667 7,995,451 4,797,146 1,446,368 231,170,530 (988,189) 230,182,341

112 University System of Georgia

Combined component unit's bonds payable are comprised of the following amounts at June 30, 2017:

Year ending June 30: 2018 2019 2020 2021 2022 2023 through 2027 2028 through 2032 2033 through 2037 2038 through 2042 2043 through 2047 2048 through 2052
Unamortized Issuance and Other Bond Related Costs Bond Premium Bond (Discount) Total

Principal

1

$

2

3

4

5

6-10

11-15

16-20

21-25

26-30

31-35

$

85,371,263 $ 94,112,022 129,703,552 105,173,881 128,231,037 648,535,183 737,926,854 639,580,000 415,915,000 42,530,000
5,074,700 3,032,153,492
(55,325,993) 131,094,757
(9,551,575) 3,098,370,681 $

Interest
127,552,059 $ 126,026,525 121,279,087 116,190,920 111,590,226 461,334,209 324,012,183 172,938,965
51,320,798 3,749,938 126,000
1,616,120,910
-- -- -- 1,616,120,910 $

Total
212,923,322 220,138,547 250,982,639 221,364,801 239,821,263 1,109,869,392 1,061,939,037 812,518,965 467,235,798
46,279,938 5,200,700
4,648,274,402
(55,325,993) 131,094,757
(9,551,575) 4,714,491,591

2017 Annual Financial Report 113

114 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CONTRIBUTIONS DEFINED BENEFIT PENSION PLANS FOR THE LAST TEN YEARS

Early Retirement Plan

Year Ended 6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 6/30/2012 6/30/2011 6/30/2010 6/30/2009 6/30/2008

Actuarially Determined Contribution
(a)
$ 12,107,903 $ 12,760,669 $ 12,996,582 $ 13,045,051 $ 13,055,907 $ 12,861,601 $ 12,973,559 $ 13,050,409 $ 13,225,850 $ 12,996,492

Contributions in Relation to the
Actuarially Determined Contribution
(b)

$

13,084,672

$

13,084,672

$

13,084,672

$

13,084,672

$

13,225,850

$

13,225,850

$

13,225,850

$

13,225,850

$

13,225,850

$

12,996,492

Contribution Deficiency (Excess)
(b-a)

$ 976,769

$ 324,003

$ 88,090

$ 39,621

$ 169,943

$ 364,249

$ 252,291

$ 175,441

$

--

$

--

Covered Payroll (c)
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

Contributions as a Percentage of Covered Payroll (b/c)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

Employees' Retirement System

6/30/2017 $ 2,963,115 $

6/30/2016 $ 2,674,110 $

6/30/2015 $ 2,094,605 $

6/30/2014 $ 1,631,633 $

6/30/2013 $ 1,238,577 $

6/30/2012 $

896,604 $

6/30/2011 $

709,947 $

6/30/2010 $

665,448 $

6/30/2009 $

687,652 $

6/30/2008 $

602,995 $

2,963,115 $ 2,674,110 $ 2,094,605 $ 1,631,633 $ 1,238,577 $
896,604 $ 709,947 $ 665,448 $ 687,652 $ 602,995 $

--$ --$ --$ --$ --$ --$ --$ --$ --$ --$

11,464,596 9,660,262 9,219,622 8,690,850 8,312,597 7,701,668 6,819,856 6,392,392 6,568,751 5,732,353

25.85% 27.68% 22.72% 18.77% 14.90% 11.64% 10.41% 10.41% 10.47% 10.52%

Teachers' Retirement System

6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 6/30/2012 6/30/2011 6/30/2010 6/30/2009 6/30/2008

$ 246,086,468 $ $ 232,397,988 $ $ 203,874,344 $ $ 181,383,954 $ $ 164,293,969 $ $ 148,193,749 $ $ 143,479,549 $ $ 135,361,497 $ $ 128,072,380 $ $ 122,832,156 $

246,086,468 $ 232,397,988 $ 203,874,344 $ 181,383,954 $ 164,293,969 $ 148,193,749 $ 143,479,549 $ 135,361,497 $ 128,072,380 $ 122,832,156 $

--$ --$ --$ --$ --$ --$ --$ --$ --$ --$

1,724,389,667 1,571,067,875 1,542,770,677 1,477,068,029 1,439,912,086 1,441,573,434 1,395,715,457 1,389,748,429 1,380,090,302 1,323,622,371

14.27% 14.79% 13.21% 12.28% 11.41% 10.28% 10.28% 9.74% 9.28% 9.28%

2017 Annual Financial Report 117

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY MULTIPLE EMPLOYER DEFINED BENEFIT PENSION PLANS FOR THE LAST THREE FISCAL YEARS*

Employees' Retirement System

Year Ended 6/30/2017 6/30/2016 6/30/2015

Teachers Retirement System

6/30/2017 6/30/2016 6/30/2015

Proportion of the Net Pension Liability

Proportionate Share of
the Net Pension Liability

0.44% $

20,881,541 $

0.40% $

16,237,112 $

0.39% $

14,722,566 $

Covered Payroll
10,285,916
9,219,622
8,690,850

Proportionate Share
of the Net Pension Liability as a Percentage of
Covered Payroll

Plan Fiduciary Net Position as a
Percentage of the Total Pension Liability

203.01%

72.34%

176.11%

76.20%

169.40%

77.99%

14.87% $ 14.74% $ 14.52% $

3,067,576,327 $ 1,626,552,148 2,243,998,382 $ 1,542,770,677 1,835,025,616 $ 1,477,068,029

188.59% 145.45% 124.23%

76.06% 81.44% 84.03%

*This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

118 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN NET PENSION LIABILITY EARLY RETIREMENT PLAN - AUGUSTA UNIVERSITY SINGLE EMPLOYER DEFINED BENEFIT PENSION PLAN FOR THE LAST FOUR FISCAL YEARS* (Dollar amounts in millions)

Total Pension Liability Interest Differences Between Expected and Actual Experience Changes of Assumptions Benefit Payments/Refunds
Net Change in Total Pension Liability Total Pension Liability - Beginning
Total Pension Liability - Ending (a)
Plan Fiduciary Net Position Contributions - Employer Net Investment Income Benefit Payments/Refunds
Net Change in Plan Fiduciary Net Position Plan Fiduciary Net Position - Beginning
Plan Fiduciary Net Position - Ending (b)
Net Pension Liability Ending (a - b)

2017

2016

2015

2014

$

10.9 $

10.3 $

10.4 $

10.6

0.1

1.3

1.3

(0.1)

--

9.9

(13.6)

(13.5)

(13.3)

(13.1)

(2.6) 151.8

8 143.8

(1.6) 145.4

(2.6) 148

$ 149.2 $ 151.8 $ 143.8 $ 145.4

$

13.1 $

13.1 $

13.1 $

13.1

10.6

1.6

3.1

11.8

(13.6)

(13.5)

(13.3)

(13.1)

10.1

1.2

2.9

11.8

80.3

79.1

76.2

64.4

$

90.4 $

80.3 $

79.1 $

76.2

$

58.8 $

71.5 $

64.7 $

69.2

* This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

2017 Annual Financial Report 119

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF EMPLOYERS' AND NONEMPLOYERS' NET PENSION LIABILITY EARLY RETIREMENT PLAN - AUGUSTA UNIVERSITY SINGLE EMPLOYER DEFINED BENEFIT PENSION PLAN FOR THE LAST FOUR FISCAL YEARS* (Dollar amounts in millions)

Total Pension Liability Plan Fiduciary Net Position

2017

2016

2015

2014

$ 149.2 $ 151.8 $ 143.8 $ 145.4

90.4

80.3

79.1

76.2

Net Pension Liability

$ 58.8 $ 71.5 $ 64.7 $ 69.2

Plan Fiduciary Net Position as a Percentage of the Total Pension Liability

60.6%

52.9%

55.0%

52.4%

Covered Payroll

N/A

N/A

N/A

N/A

Employers' and Nonemployers' Net Pension Liability as a Percentage of

Covered Payroll

N/A

N/A

N/A

N/A

* This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

120 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF INVESTMENT RETURNS EARLY RETIREMENT PLAN - AUGUSTA UNIVERSITY SINGLE EMPLOYER DEFINED BENEFIT PENSION PLAN FOR THE LAST FOUR FISCAL YEARS*

Annual Money-Weighted Rate of Return, Net of Investment Expense

2017 13.39%

2016 2.02%

2015 4.13%

2014 18.35%

* This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

2017 Annual Financial Report 121

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO THE REQUIRED SUPPLEMENTAL INFORMATION DEFINED BENEFIT PENSION PLANS METHODS AND ASSUMPTIONS FOR FISCAL YEAR ENDED JUNE 30, 2017
Changes of assumptions Early Retirement Plan: The expectation of retired life mortality was changed effective June 30, 2016 to the RP-2014 Mortality Table rather than the RP-2000 Mortality Table used previously. Mortality rates were adjusted to better recognize current and future mortality improvements. Employees' Retirement System: On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. Teachers Retirement System: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience. On November 18, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP 2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males).
122 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION BOARD OF REGENTS RETIREE HEALTH BENEFIT FUND SCHEDULE OF FUNDING PROGRESS AND EMPLOYER CONTRIBUTIONS FOR OTHER POSTEMPLOYMENT BENEFITS FISCAL YEAR ENDED JUNE 30, 2017

Funding Progress:

Actuarial Valuation
Date
7/1/2014 7/1/2015* 7/1/2016

Actuarial Value of Assets
(a)

$

81,519

$ 280,596

$ 2,898,502

Actuarial Accrued Liability (AAL) Projected Unit
Credit (b)
$ 4,278,445,406
$ 2,657,095,907
$ 3,068,725,854

Unfunded AAL (UAAL) (b-a)
$ 4,278,363,887
$ 2,656,815,311
$ 3,065,827,352

Funded Ratio (a/b)
0.0% 0.0% 0.1%

Annual Covered Payroll (c)

$

2,608,756,645

$

3,087,013,265

$

2,855,308,903

UAAL as a Percentage of
Covered Payroll (9b-a)/c)
164.0%
86.1%
107.4%

Employer Contributions (dollar amounts in millions):

Fiscal Year Ended
2015 2016* 2017

Annual OPEB Cost

$

450.1

$

304.3

$

359.8

Contribution

$

129.8

$

111.8

$

99.6

Percentage of Annual
OPEB Cost Contributed
28.8%
36.7%
27.7%

Net OPEB Obligation

$

2,163.4

$

2,355.9

$

2,616.1

*Changes in Plan Provisions: Effective January 1, 2016, all post-65 Medicare eligible retirees access medical coverage through an individual Healthcare Exchange marketplace. The Board of Regents of the University System of Georgia provides an annual fixed dollar HRA contribution for these retirees.

2017 Annual Financial Report 123

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN NET OPEB LIABILITY BOARD OF REGENTS RETIREE HEALTH BENEFIT PLAN SINGLE EMPLOYER DEFINED BENEFIT OPEB PLAN FOR FISCAL YEAR ENDED 2017*

Total OPEB Liability Service Cost Interest Differences Between Expected and Actual Experience Changes of Assumptions Benefit Payments/Refunds
Net Change in Total OPEB Liability Total OPEB Liability - Beginning
Total OPEB Liability - Ending (a)
Plan Fiduciary Net Position Contributions - Employer Net Investment Income Administrative Expense Benefit Payments/Refunds
Net Change in Plan Fiduciary Net Position Plan Fiduciary Net Position - Beginning
Plan Fiduciary Net Position - Ending (b)
Net OPEB Liability Ending (a - b)

2017

$

211,512,614

124,612,066

123,090,290

(347,330,873)

(89,653,306)

22,230,791 4,205,352,304

$

4,227,583,095

$

99,583,903

72,961

(5,044,837)

(89,653,306)

4,958,721 2,898,502

$

7,857,223

$

4,219,725,872

* This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

124 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF NET OPEB LIABILITY BOARD OF REGENTS RETIREE HEALTH BENEFIT PLAN SINGLE EMPLOYER DEFINED BENEFIT OPEB PLAN FOR FISCAL YEAR ENDED 2017*

Total OBEB Liability Plan Fiduciary Net Position
Net OPEB Liability Plan Fiduciary Net Position as a Percentage of the Total OPEB Liability Covered Employee Payroll
Net OPEB Liability as a Percentage of Covered Employee Payroll

2017 $ 4,227,583,095
7,857,223
$ 4,219,725,872 0.19%
$ 2,855,308,903
147.79%

* This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

2017 Annual Financial Report 125

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF INVESTMENT RETURNS BOARD OF REGENTS RETIREE HEALTH BENEFIT PLAN SINGLE EMPLOYER DEFINED BENEFIT OPEB PLAN FOR FISCAL YEAR ENDED 2017*

Annual Money-Weighted Rate of Return, Net of Investment Expense

2017 0.99%

* This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

126 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO THE REQUIRED SUPPLEMENTAL INFORMATION BOARD OF REGENTS RETIREE HEALTH BENEFIT PLAN SINGLE EMPLOYER DEFINED BENEFIT OPEB PLAN METHODS AND ASSUMPTIONS FOR FISCAL YEAR ENDED JUNE 30, 2017 Changes in Assumptions Since Prior Valuation Expected claim costs were updated to reflect actual claims experience. Trend was reset based on current conditions. Disability, termination, retirement, and disabled mortality tables were updated to reflect the current Teachers Retirement System of Georgia methodology.
2017 Annual Financial Report 127

128 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

Abraham Baldwin Agricultural College

Albany State University

Armstrong State University

Atlanta Metropolitan State College

ASSETS

Current Assets

Cash & Cash Equivalents

$

Short-term Investments

Accounts Receivable, net

Federal Financial Assistance

Affiliated Organizations

Component Units

Primary Government

Other

Notes Receivable, net

Investment in Capital Leases - Primary Government

Investment in Capital Leases - Other

Inventories

Prepaid Items

Other Assets

Total Current Assets

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Due From USO - Capital Liability Reserve Fund Due From Institution - Capital Liability Reserve Fund Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES $

6,958,418 $ 118,829
403,920 50,225 -- --
2,221,532 --
--
358,110 5,994 --
10,117,028
--
-- --
--
-- -- -- -- 241,641
-- -- -- -- -- -- 57,576,314 57,817,955 67,934,983
-- 5,068,939
-- 5,068,939 $

7,626,137 $ -- --
2,640,914 -- -- --
4,264,486 --
-- -- -- 31,040 -- 14,562,577
--
-- --
801,382
-- -- -- -- 313,864
-- -- -- -- -- -- 202,866,457 203,981,703 218,544,280
-- 14,205,729
-- 14,205,729 $

19,225,870 $
963,951 10,613 -- --
3,047,068 --
--
-- 3,217,146
-- 26,464,648
--
-- --
220,862
-- --
25,500 --
-- -- -- 155,999 -- 3,353,119 107,401,784 111,157,264 137,621,912
643,071 8,176,753
-- 8,819,824 $

431,170 --
338,409 -- -- --
2,779,146 --
-- -- -- 170,979 -- 3,719,704
--
-- --
69,628
-- -- -- -- --
-- -- -- -- -- -- 36,102,704 36,172,332 39,892,036
-- 4,303,511
-- 4,303,511

2017 Annual Financial Report 131

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Interest Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Abraham Baldwin Agricultural College

Albany State University

Armstrong State University

Atlanta Metropolitan State College

$

647,807 $

799,371 $

320,867 $

633,339

213,267

386,501

262,711

129,549

76,723

128,044

170,638

43,319

379,654

198,437

160,690

318,017

93,645

106,165

12,325

140,383

-- -- -- 647,368 165,840 896,346 -- -- 23,640 -- -- -- -- -- -- 562,011 3,706,301

-- -- -- 3,270,295 333,949 1,655,117 -- -- 2,399,277 290,525 -- -- -- -- -- 1,263,165 10,830,846

-- -- -- 2,867,105 41,822 935,541 90,557 -- -- 1,238,420 -- -- -- -- -- 1,388,670 7,489,346

834,063 2,597
879,086 16,948 --
184,732
-- -- --
355,189 465,055 4,002,277

Non-Current Liabilities

Due to Affiliated Organizations

Due to Primary Government

Due to Other Funds

Advances (Including Tuition & Fees)

Other Liabilities

Notes & Loans Payable

Lease Purchase Obligations - External

Lease Purchase Obligations - Component Units

Revenue Bonds & Notes Payable

Liabilities Under Split Interest Agreements

Interest Rate Swap

Pollution Remediation

Claims & Judgments

Compensated Absences

Other Post Employment Benefits Obligation

Net Pension Liability

Total Non-Current Liabilities

TOTAL LIABILITIES

$

-- -- -- -- -- -- 50,408 -- -- -- -- -- -- 380,893 -- 18,576,021 19,007,322 22,713,623 $

-- -- -- -- -- -- 90,449,414 19,377,958 -- -- -- -- -- 1,158,619 -- 57,829,522 168,815,513 179,646,359 $

-- -- -- -- -- -- -- 37,419,782 -- -- -- -- -- 595,144 -- 31,481,710 69,496,636 76,985,982 $

-- -- -- -- -- -- 9,672,510 -- -- -- -- -- 1,364,004 363,498 -- 17,083,388 28,483,400 32,485,677

132 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

DEFERRED INFLOWS OF RESOURCES
Deferred Gain on Debt Refunding
Deferred Funds Received in Advance of Timing Requirements
Deferred Service Concession Arrangements
Deferred Gain on Defined Benefit Pension Plans
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

Abraham Baldwin Agricultural College

Albany State University

Armstrong State University

Atlanta Metropolitan State College

$

--$

1,155,142 $

2,960,360 $

--

-- -- 299,596

100,000 --
4,562,861

-- -- 905,806

-- -- 299,328

-- 299,596

-- 5,818,003

-- 3,866,166

-- 299,328

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Capital Projects Higher Education Unrestricted (Deficit)

57,028,967 --
664,977
(7,703,241)

88,889,539 --
455,789
(42,059,681)

66,426,293 3,479,659 323,107
(4,639,471)

25,787,062 --
77,092
(14,453,612)

TOTAL NET POSITION

$

49,990,703 $

47,285,647 $

65,589,588 $

11,410,542

2017 Annual Financial Report 133

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

Augusta University

Bainbridge State College

Clayton State University

College of Coastal Georgia

ASSETS

Current Assets

Cash & Cash Equivalents

$

Short-term Investments

Accounts Receivable, net

Federal Financial Assistance

Affiliated Organizations

Component Units

Primary Government

Other

Notes Receivable, net

Investment in Capital Leases - Primary Government

Investment in Capital Leases - Other

Inventories

Prepaid Items

Other Assets

Total Current Assets

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Due From USO - Capital Liability Reserve Fund Due From Institution - Capital Liability Reserve Fund Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES $

13,058,900 $ --
8,976,659 553,799
37,163,716 --
33,612,275 --
-- -- 843,658 13,144,846 -- 107,353,853
--
-- --
197,730
-- -- -- 82,393,086 2,686,925
-- -- -- -- -- 2,408,636 526,986,011 614,672,388 722,026,241
2,808,243 91,979,969
-- 94,788,212 $

755,070 $
442,193 11,349 -- --
1,274,305 --
--
-- 13,363
-- 2,496,280
--
-- --
--
-- -- -- 74,999 --
-- -- -- 1,588 -- 1,794,967 50,550,993 52,422,547 54,918,827
-- 2,559,291
-- 2,559,291 $

6,402,569 $
786,220 1,843,822
-- -- 4,788,761 --
--
772,311 183,066
-- 14,776,749
--
-- --
578,205
-- -- -- -- 6,188
-- -- -- -- -- -- 130,471,928 131,056,321 145,833,070
-- 8,601,183
-- 8,601,183 $

3,722,460
102,678 200,474
-- -- 1,052,026 --
--
31,545 198,087
-- 5,307,270
--
-- --
77,550
-- -- -- -- --
-- -- -- -- -- 150,028 68,503,754 68,731,332 74,038,602
-- 3,071,654
-- 3,071,654

134 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Interest Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Augusta University

Bainbridge State College

Clayton State University

College of Coastal Georgia

$

7,133,767 $

3,116,835

2,391,267

1,457,960

346,850

987,096 4,640,632
-- 48,859,656
-- 2,686,891
-- -- 1,431,449 2,202,435 -- -- -- -- -- 21,347,559 96,602,397

653,748 $ 75,603 25,989 -- --
-- -- -- 533,898 -- 763,560 3,937 -- 320,746 -- -- -- -- -- -- 217,449 2,594,930

1,794,995 $ 339,226 89,524 -- --
155,269 -- --
1,728,330 37,796
593,321 7,017 -- --
1,352,557 -- -- -- -- --
1,367,910 7,465,945

550,329 164,322
55,323 -- --
28,243 -- --
758,354 14,205
250,544 -- --
259,411 -- -- -- -- -- --
448,116 2,528,847

Non-Current Liabilities

Due to Affiliated Organizations

Due to Primary Government

Due to Other Funds

Advances (Including Tuition & Fees)

Other Liabilities

Notes & Loans Payable

Lease Purchase Obligations - External

Lease Purchase Obligations - Component Units

Revenue Bonds & Notes Payable

Liabilities Under Split Interest Agreements

Interest Rate Swap

Pollution Remediation

Claims & Judgments

Compensated Absences

Other Post Employment Benefits Obligation

Net Pension Liability

Total Non-Current Liabilities

TOTAL LIABILITIES

$

-- -- -- -- -- -- 3,090,915 48,801,402 -- -- -- -- -- 17,634,667 -- 405,908,449 475,435,433 572,037,830 $

-- -- -- -- -- -- 17,788,041 -- -- -- -- -- -- 84,663 -- 10,552,521 28,425,225 31,020,155 $

-- -- -- -- -- -- -- 77,616,325 -- -- -- -- -- 801,960 -- 34,741,864 113,160,149 120,626,094 $

-- -- -- -- -- -- 11,301,648 -- -- -- -- -- -- 222,404 -- 12,050,754 23,574,806 26,103,653

2017 Annual Financial Report 135

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

DEFERRED INFLOWS OF RESOURCES
Deferred Gain on Debt Refunding
Deferred Funds Received in Advance of Timing Requirements
Deferred Service Concession Arrangements
Deferred Gain on Defined Benefit Pension Plans
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

Augusta University

Bainbridge State College

Clayton State University

College of Coastal Georgia

$

847,464 $

-- -- 13,197,249

-- 14,044,713

--$
-- -- 1,903,982
-- 1,903,982

--$
-- -- 1,009,664
-- 1,009,664

--
30,000 --
209,565
-- 239,565

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Capital Projects Higher Education Unrestricted (Deficit)

472,466,154 2,408,636
43,789,490
(287,932,370)

32,442,206 1,799,668 212,056
(9,899,949)

51,503,046 1,647,959 8,835
(20,361,345)

56,942,695 68,879
112,557
(6,357,093)

TOTAL NET POSITION

$

230,731,910 $

24,553,981 $

32,798,495 $

50,767,038

136 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

Columbus State University

Dalton State College

East Georgia State College

Fort Valley State University

ASSETS

Current Assets

Cash & Cash Equivalents

$

Short-term Investments

Accounts Receivable, net

Federal Financial Assistance

Affiliated Organizations

Component Units

Primary Government

Other

Notes Receivable, net

Investment in Capital Leases - Primary Government

Investment in Capital Leases - Other

Inventories

Prepaid Items

Other Assets

Total Current Assets

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Due From USO - Capital Liability Reserve Fund Due From Institution - Capital Liability Reserve Fund Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES $

17,325,943 $ 104,258
2,504,691 443,744 -- --
2,821,022 --
--
-- 561,621
-- 23,761,279
--
-- --
259,144
-- -- -- 2,858,307 787,432
-- -- -- 401,367 -- 2,125,115 110,718,848 117,150,213 140,911,492
-- 12,165,845
-- 12,165,845 $

6,935,822 $
451,229 585,382
-- -- 554,265 --
--
11,406 48,040
-- 8,586,144
--
-- --
46,314
-- -- -- -- --
-- -- -- -- -- -- 48,765,998 48,812,312 57,398,456
-- 5,364,860
-- 5,364,860 $

2,033,131 $
1,236,343 121 -- --
927,346 --
-- -- 12,583 2,082 -- 4,211,606
--
-- --
--
-- -- -- 4,800 --
-- -- -- -- -- 40,262 25,725,433 25,770,495 29,982,101
-- 3,311,939
-- 3,311,939 $

4,256,949
-- 3,415,533
763,674 -- -- -- --
--
-- 72,330
-- 8,508,486
--
-- --
650,273
-- -- -- 69,413 1,027,837
-- -- -- -- -- -- 145,221,517 146,969,040 155,477,526
383,752 8,178,321
-- 8,562,073

2017 Annual Financial Report 137

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Interest Payable Due to Affiliated Organizations Due to Component Units Due to USO - Capital Liability Reserve Fund Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Columbus State University

Dalton State College

East Georgia State College

Fort Valley State University

$

2,223,392 $

438,452

151,404

98,861

--

-- -- -- 4,899,825 250 1,413,245 -- --

1,538,116 -- -- -- -- --
1,624,131 12,387,676

328,205 $ 178,780 114,452
-- --
-- -- -- 852,956 12,791 557,706 -- -- -- 122,954 -- -- -- -- -- 490,369 2,658,213

401,809 $ 136,541
48,483 --
148,001
-- -- -- 377,358 13,800 100,542 -- -- 1,529 -- -- -- -- -- -- 372,387 1,600,450

1,575,164 165,668 66,222 15,024 92,044
-- -- 321,895 1,045,266 1,406 509,850 -- -- 272,913 -- -- -- -- -- 232,183 1,262,733 5,560,368

Non-Current Liabilities

Due to Affiliated Organizations

Due to Primary Government

Due to Other Funds

Advances (Including Tuition & Fees)

Other Liabilities

Notes & Loans Payable

Lease Purchase Obligations - External

Lease Purchase Obligations - Component Units

Revenue Bonds & Notes Payable

Liabilities Under Split Interest Agreements

Interest Rate Swap

Pollution Remediation

Claims & Judgments

Compensated Absences

Other Post Employment Benefits Obligation

Net Pension Liability

Total Non-Current Liabilities

TOTAL LIABILITIES

$

-- -- -- -- -- --
42,500,858 -- -- -- -- --
1,172,087 --
47,241,764 90,914,709 103,302,385 $

-- -- -- -- -- -- 5,968,817 -- -- -- -- -- -- 201,853 -- 19,944,924 26,115,594 28,773,807 $

-- -- -- -- -- -- 2,960 -- -- -- -- -- -- 240,923 -- 11,574,056 11,817,939 13,418,389 $

-- -- -- -- -- -- 76,280,405 -- -- -- -- -- 232,183 661,487 -- 33,447,370 110,621,445 116,181,813

138 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

DEFERRED INFLOWS OF RESOURCES
Deferred Gain on Debt Refunding
Deferred Funds Received in Advance of Timing Requirements
Deferred Service Concession Arrangements
Deferred Gain on Defined Benefit Pension Plans
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

Columbus State University

Dalton State College

East Georgia State College

Fort Valley State University

$

--$

180,000 --
1,336,058

-- 1,516,058

597,862 $
-- -- 254,291
-- 852,153

--$
-- -- 310,969
-- 310,969

3,778,043
-- -- 3,832,418
-- 7,610,461

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Capital Projects Higher Education Unrestricted (Deficit)

66,581,013 1,900,159 3,910,713
(24,132,991)

42,076,365 --
1,961
(8,940,970)

25,572,942 37,100 49,291
(6,094,651)

65,166,840 --
2,960,325
(27,879,840)

TOTAL NET POSITION

$

48,258,894 $

33,137,356 $

19,564,682 $

40,247,325

2017 Annual Financial Report 139

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

Georgia College & State University

Georgia Gwinnett College

Georgia Highlands College

Georgia Institute of Technology

ASSETS

Current Assets

Cash & Cash Equivalents

$

Short-term Investments

Accounts Receivable, net

Federal Financial Assistance

Affiliated Organizations

Component Units

Primary Government

Other

Notes Receivable, net

Investment in Capital Leases - Primary Government

Investment in Capital Leases - Other

Inventories

Prepaid Items

Other Assets

Total Current Assets

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Due From USO - Capital Liability Reserve Fund Due From Institution - Capital Liability Reserve Fund Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES $

23,531,023 $
312,973 206,099
-- -- 3,722,223 --
--
296,620 1,924,777
-- 29,993,715
1,968,206 --
1,081,968
-- -- -- 3,917,350 1,696,125
-- -- -- 206,064 -- 3,970,284 175,098,603 187,938,600 217,932,315
-- 17,154,919
-- 17,154,919 $

28,606,556 $ --
280,093 --
41,214 --
1,527,775 --
-- -- -- 590,305 -- 31,045,943
--
-- --
1,507,117
-- -- -- -- --
-- -- -- -- -- -- 235,852,195 237,359,312 268,405,255
19,742,274 17,467,263
-- 37,209,537 $

5,201,925 $
1,753,967 53,195 -- --
4,241,670 --
--
-- 81,658
-- 11,332,415

295,827,482 156,645
9,556,347 --
76,864,935 --
31,146,193 --
--
941,999 16,485,440
-- 430,979,041

--
-- --
115,505
-- -- -- 39,054 --
-- -- -- -- -- -- 50,356,547 50,511,106 61,843,521

--
-- --
2,275,907
-- -- -- 11,386,498 11,994,191
-- -- -- 81,539 -- 65,177,165 1,901,947,788 1,992,863,088 2,423,842,129

-- 5,296,829
-- 5,296,829 $

-- 135,937,111
-- 135,937,111

140 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Interest Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Georgia College & State University

Georgia Gwinnett College

Georgia Highlands College

Georgia Institute of Technology

$

3,258,942 $

3,019,187 $

405,575

447,563

190,747

547,813

234,757

54,245

404,857

18,160

-- 3,652
-- 1,860,037
345,175 863,275 755,609
-- 982,044 2,146,083
-- -- -- -- -- 2,259,976 13,710,729

-- 4,068
-- 2,331,612
930,590 357,370
67,524 --
1,091,599 3,529,545
-- -- -- -- -- 1,270,345 13,669,621

612,597 $ --
102,024 --
7,970
-- -- -- 5,239,055 2,685 370,718 41,760 -- 380,812 -- -- -- -- -- -- 691,546 7,449,167

78,445,216 2,580,227 632,069 9,883,993 2,893,949
123,644 -- --
25,052,116 8,922,245
14,731,344 406,178
1,077,628 3,371,074 15,631,198
-- -- -- 443,715 -- 36,219,301 200,413,897

Non-Current Liabilities

Due to Affiliated Organizations

Due to Primary Government

Due to Other Funds

Advances (Including Tuition & Fees)

Other Liabilities

Notes & Loans Payable

Lease Purchase Obligations - External

Lease Purchase Obligations - Component Units

Revenue Bonds & Notes Payable

Liabilities Under Split Interest Agreements

Interest Rate Swap

Pollution Remediation

Claims & Judgments

Compensated Absences

Other Post Employment Benefits Obligation

Net Pension Liability

Total Non-Current Liabilities

TOTAL LIABILITIES

$

-- -- -- -- -- -- 34,527,289 84,779,839 -- -- -- -- -- 652,039 -- 57,295,261 177,254,428 190,965,157 $

-- -- -- -- -- -- 5,679,830 160,206,552 -- -- -- -- -- 739,918 -- 45,313,387 211,939,687 225,609,308 $

-- -- -- -- -- -- 15,733,671 -- -- -- -- -- -- 195,590 -- 21,744,717 37,673,978 45,123,145 $

-- -- -- -- -- 6,335,037 81,770,826 342,688,369 -- -- -- -- -- 13,321,321 -- 474,811,843 918,927,396 1,119,341,293

2017 Annual Financial Report 141

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

DEFERRED INFLOWS OF RESOURCES
Deferred Gain on Debt Refunding
Deferred Funds Received in Advance of Timing Requirements
Deferred Service Concession Arrangements
Deferred Gain on Defined Benefit Pension Plans
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

Georgia College & State University

Georgia Gwinnett College

Georgia Highlands College

$

3,552,044 $

--$

--

1,168,102 --
298,405

-- 2,537,067
293,718

-- -- 1,092,351

-- 5,018,551

-- 2,830,785

-- 1,092,351

Georgia Institute of Technology
10,536,383 --
2,342,427 --
12,878,810

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Capital Projects Higher Education Unrestricted (Deficit)

53,062,796 4,063,223 5,032,330
(23,054,823)

82,594,909 --
75,253
(5,495,463)

34,242,064 39,056 (89,079)
(13,267,187)

1,435,060,932 65,258,703 29,277,394
(102,037,892)

TOTAL NET POSITION

$

39,103,526 $

77,174,699 $

20,924,854 $

1,427,559,137

142 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

Georgia Southern University

Georgia Southwestern

State University

Georgia State University Gordon State College

ASSETS

Current Assets

Cash & Cash Equivalents

$

Short-term Investments

Accounts Receivable, net

Federal Financial Assistance

Affiliated Organizations

Component Units

Primary Government

Other

Notes Receivable, net

Investment in Capital Leases - Primary Government

Investment in Capital Leases - Other

Inventories

Prepaid Items

Other Assets

Total Current Assets

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Due From USO - Capital Liability Reserve Fund Due From Institution - Capital Liability Reserve Fund Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES $

47,241,926 $
9,100,986 2,146,401
532,799 --
4,847,216 --
--
3,870,190 120,828 --
67,860,346
--
3,096,400
1,778,721
-- -- -- 3,514,532 2,284,467
-- -- -- -- -- 2,465,814 544,814,556 557,954,490 625,814,836
-- 35,927,101
-- 35,927,101 $

7,856,498 $ --
66,959 -- -- --
1,407,946 --
--
618,075 284,522
-- 10,234,000

198,846,133 $
21,856,820 28,940
22,139,877 --
5,655,446 --
--
335,943 4,547,473
-- 253,410,632

--
-- --
267,598
-- -- -- 316,579 753,081
-- -- -- -- -- 462,622 84,243,490 86,043,370 96,277,370

1,632,624 --
1,414,211
-- -- -- -- 4,779,626
-- -- -- 516,121 -- 118,725 970,886,936 979,348,243 1,232,758,875

-- 3,563,067
-- 3,563,067 $

-- 89,512,601
-- 89,512,601 $

11,043,459
249,221 -- -- --
473,789 --
--
311,685 135,821
-- 12,213,975
--
-- --
355,150
-- -- -- -- --
-- -- -- -- -- -- 83,653,681 84,008,831 96,222,806
-- 4,719,592
-- 4,719,592

2017 Annual Financial Report 143

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Interest Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Georgia Southern University

Georgia Southwestern

State University

Georgia State University Gordon State College

$

6,049,138 $

1,694,738

538,329

1,612,900

250,100

413,854 -- --
7,002,707 841,222
1,413,543 510
138,559 362,762 7,377,366
-- -- -- -- -- 5,191,853 32,887,581

834,990 $ 344,382
79,885 --
57,875
-- -- -- 3,292,448 83,865 99,997 (20,245) -- 718,273 -- -- -- -- -- -- 584,220 6,075,690

19,429,207 $ 3,443,866 6,405,859 8,101,938 1,809,144
1,864,367
27,175,256 32,985
2,678,738 414,244
1,596,836 7,433,260
-- -- -- -- 12,175,215 92,560,915

594,662 160,564
75,389 5,430 --
-- -- -- 392,284 97,126 597,094 -- -- -- 1,053,520 -- -- -- -- -- 546,684 3,522,753

Non-Current Liabilities

Due to Affiliated Organizations

Due to Primary Government

Due to Other Funds

Advances (Including Tuition & Fees)

Other Liabilities

Notes & Loans Payable

Lease Purchase Obligations - External

Lease Purchase Obligations - Component Units

Revenue Bonds & Notes Payable

Liabilities Under Split Interest Agreements

Interest Rate Swap

Pollution Remediation

Claims & Judgments

Compensated Absences

Other Post Employment Benefits Obligation

Net Pension Liability

Total Non-Current Liabilities

TOTAL LIABILITIES

$

-- -- -- -- -- 1,109,449 21,333,376 190,916,687 -- -- -- -- -- 2,036,051 -- 129,274,638 344,670,201 377,557,782 $

-- -- -- -- -- -- 35,892,311 -- -- -- -- -- -- 306,093 -- 13,801,726 50,000,130 56,075,820 $

-- -- -- -- -- -- 33,393,254 205,621,844 -- -- -- -- -- 8,412,097 -- 336,526,348 583,953,543 676,514,458 $

-- -- -- -- -- -- -- 40,649,810 -- -- -- -- -- 187,758 -- 19,243,496 60,081,064 63,603,817

144 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

DEFERRED INFLOWS OF RESOURCES
Deferred Gain on Debt Refunding
Deferred Funds Received in Advance of Timing Requirements
Deferred Service Concession Arrangements
Deferred Gain on Defined Benefit Pension Plans
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

Georgia Southern University

Georgia Southwestern

State University

Georgia State University Gordon State College

$

2,766,548 $

-- -- 649,150

-- 3,415,698

--$
-- -- 679,307
-- 679,307

6,163,284 $
21,062,136 --
7,454,902
-- 34,680,322

--
943,789 --
571,065
-- 1,514,854

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Capital Projects Higher Education Unrestricted (Deficit)

319,347,566 2,465,814 7,937,634
(48,982,557)

47,458,468 462,622
1,091,742
(5,927,522)

706,756,462 105,317
32,555,999
(128,341,082)

41,944,921 --
7,348
(6,128,542)

TOTAL NET POSITION

$

280,768,457 $

43,085,310 $

611,076,696 $

35,823,727

2017 Annual Financial Report 145

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

Kennesaw State University

Middle Georgia State University

Savannah State University

South Georgia State College

ASSETS

Current Assets

Cash & Cash Equivalents

$

Short-term Investments

Accounts Receivable, net

Federal Financial Assistance

Affiliated Organizations

Component Units

Primary Government

Other

Notes Receivable, net

Investment in Capital Leases - Primary Government

Investment in Capital Leases - Other

Inventories

Prepaid Items

Other Assets

Total Current Assets

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Due From USO - Capital Liability Reserve Fund Due From Institution - Capital Liability Reserve Fund Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES $

99,371,173 $
2,535,087 3,918,599 3,390,308
-- 9,932,545
--
--
3,198,795 2,122,766
-- 124,469,273
--
-- --
2,098,531
-- -- --
632,587
-- -- -- -- -- 4,633,634 635,180,938 642,545,690 767,014,963
1,049,629 50,193,627
-- 51,243,256 $

9,209,701 $
84,025 316,951
--
2,587,359 --
--
1,429,133 81,592 --
13,708,761
--
-- --
715,528
-- -- -- 1,864,396 --
-- -- -- -- -- -- 231,788,235 234,368,159 248,076,920
-- 11,482,971
-- 11,482,971 $

4,807,172 $ 408,276
1,931,509 -- -- --
5,740,261 --
-- -- 83,196 135,155 -- 13,105,569
-- --
844,039
-- -- -- -- 785,546
-- -- -- 114,922 20,876 7,428,930 139,453,020 148,647,333 161,752,902
-- 11,211,681
-- 11,211,681 $

3,567,582
339,989 84,793 -- --
595,443 --
--
279,144 432,613
-- 5,299,564
--
-- --
266,644
-- -- -- 210,762 49,273
-- -- -- 16,367 -- 285,240 50,441,206 51,269,492 56,569,056
-- 2,932,619
-- 2,932,619

146 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Interest Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

Kennesaw State University

Middle Georgia State University

Savannah State University

South Georgia State College

$

15,600,865 $

1,675,742

638,266

532,391

278,878

15,594 1,534,438
-- 17,720,919
42,409 1,763,357
217,797 --
1,105,627 8,684,557
-- -- -- -- -- 7,854,330 57,665,170

979,562 $ 398,997
-- -- --
-- -- -- 1,374,532 1,361,700 844,947 -- -- -- 1,617,111 -- -- -- -- 125,372 1,454,051 8,156,272

1,039,457 $ 312,936 96,820 -- 87,952
-- -- -- 2,736,791 -- 2,012,631 1,574 -- -- 2,337,164 -- -- -- -- 190,381 954,904 9,770,610

307,362 118,165
33,334 111,441 219,159
-- -- -- 436,309 5 33,040 1,157,488 -- -- 390,609 -- -- -- -- -- 399,100 3,206,012

Non-Current Liabilities

Due to Affiliated Organizations

Due to Primary Government

Due to Other Funds

Advances (Including Tuition & Fees)

Other Liabilities

Notes & Loans Payable

Lease Purchase Obligations - External

Lease Purchase Obligations - Component Units

Revenue Bonds & Notes Payable

Liabilities Under Split Interest Agreements

Interest Rate Swap

Pollution Remediation

Claims & Judgments

Compensated Absences

Other Post Employment Benefits Obligation

Net Pension Liability

Total Non-Current Liabilities

TOTAL LIABILITIES

$

-- -- -- -- -- -- 54,031,473 229,550,273 -- -- -- -- -- 3,433,454 -- 179,090,405 466,105,605 523,770,775 $

-- -- -- -- -- -- -- 92,178,384 -- -- -- -- -- 787,717 -- 44,570,285 137,536,386 145,692,658 $

-- -- -- -- -- -- -- 95,125,460 -- -- -- -- 190,381 1,095,572 -- 39,529,835 135,941,248 145,711,858 $

-- -- -- -- -- -- -- 30,448,410 -- -- -- -- -- 115,428 -- 12,001,946 42,565,784 45,771,796

2017 Annual Financial Report 147

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

DEFERRED INFLOWS OF RESOURCES
Deferred Gain on Debt Refunding
Deferred Funds Received in Advance of Timing Requirements
Deferred Service Concession Arrangements
Deferred Gain on Defined Benefit Pension Plans
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

Kennesaw State University

Middle Georgia State University

Savannah State University

South Georgia State College

$

--$

-- 63,555,727
1,370,810

-- 64,926,537

--$
378,000 --
2,319,185
-- 2,697,185

4,202,714 $
-- -- 231,022
-- 4,433,736

--
-- -- 1,055,868
-- 1,055,868

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Capital Projects Higher Education Unrestricted (Deficit)

278,269,993 4,378,951 1,516,408
(54,604,445)

137,992,740 580,183
1,659,537
(29,062,412)

37,787,682 7,374,665 1,030,718
(23,374,076)

19,602,187 301,490 323,680
(7,553,346)

TOTAL NET POSITION

$

229,560,907 $

111,170,048 $

22,818,989 $

12,674,011

148 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

University of Georgia

University of North Georgia

University of West Georgia

Valdosta State University

ASSETS

Current Assets

Cash & Cash Equivalents

$

Short-term Investments

Accounts Receivable, net

Federal Financial Assistance

Affiliated Organizations

Component Units

Primary Government

Other

Notes Receivable, net

Investment in Capital Leases - Primary Government

Investment in Capital Leases - Other

Inventories

Prepaid Items

Other Assets

Total Current Assets

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Due From USO - Capital Liability Reserve Fund Due From Institution - Capital Liability Reserve Fund Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES $

282,984,657 $ 5,519,177
5,250,499 --
48,936,905 --
39,894,019 --
--
6,465,235 7,000,069
-- 396,050,561
--
-- --
1,767,538
-- -- -- 116,130,645 9,224,248
-- -- -- 3,410,149 -- 82,931,515 1,979,909,000 2,193,373,095 2,589,423,656
-- 211,548,428
-- 211,548,428 $

37,753,699 $ 1,971,785
550,781 423,822
-- -- 3,150,642 --
--
1,515,834 5,603,948
-- 50,970,511
-- --
983,809
-- -- -- -- 1,187,725
-- -- -- 1,069,401 -- 1,522,939 249,185,226 253,949,100 304,919,611
-- 34,219,808
-- 34,219,808 $

56,908,194 $ --
925,344 64,904 -- --
1,821,187 --
--
1,589,644 616,879 --
61,926,152
--
-- --
1,357,248
-- -- -- -- 2,858,232
-- -- -- -- -- -- 297,903,766 302,119,246 364,045,398
1,449,791 26,512,241
-- 27,962,032 $

26,957,513
5,923,072 219,367 -- --
2,179,430 --
--
15,317 173,668
-- 35,468,367
--
-- --
1,364,272
-- -- -- 10,811,883 35,093
-- -- -- 32,710 -- 4,192,604 309,907,771 326,344,333 361,812,700
1,925,033 17,536,553
-- 19,461,586

2017 Annual Financial Report 149

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Interest Payable Due to Affiliated Organizations Due to Component Units Due to Primary Government Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

University of Georgia

University of North Georgia

University of West Georgia

Valdosta State University

$

33,864,958 $

7,301,466

--

5,160,869

1,396,810

-- 982,713
-- 48,573,054
1,320,902 6,053,890
765,179 330,884 483,459 7,990,341
-- -- -- 175,200 -- 31,862,493 146,262,218

2,484,363 $ 634,643 401,824 14,016 57,209
18,150 -- --
5,965,851 906,463
1,269,215 -- -- --
2,686,008 -- -- -- -- --
2,730,360 17,168,102

3,490,972 $ 708,046
2,027,081 118,396 78,180
-- -- -- 5,028,985 -- 512,140 56,271 -- 1,425,785 2,419,018 -- -- -- -- 700 2,713,802 18,579,376

3,149,995 645,791 752,348 -- 108,589
-- -- -- 4,852,829 653,534 2,481,144 588 -- 145,695 4,989,152 -- -- -- -- -- 2,237,921 20,017,586

Non-Current Liabilities

Due to Affiliated Organizations

Due to Primary Government

Due to Other Funds

Advances (Including Tuition & Fees)

Other Liabilities

Notes & Loans Payable

Lease Purchase Obligations - External

Lease Purchase Obligations - Component Units

Revenue Bonds & Notes Payable

Liabilities Under Split Interest Agreements

Interest Rate Swap

Pollution Remediation

Claims & Judgments

Compensated Absences

Other Post Employment Benefits Obligation

Net Pension Liability

Total Non-Current Liabilities

TOTAL LIABILITIES

$

-- -- -- -- -- 1,760,747 240,040 257,505,595 -- -- -- 609,515 -- 15,711,765 -- 771,016,123 1,046,843,785 1,193,106,003 $

-- -- -- -- -- -- -- 122,879,457 -- -- -- -- -- 2,113,635 -- 98,039,486 223,032,578 240,200,680 $

-- -- -- 2,295 -- -- 46,933,854 116,839,597 -- -- -- -- -- 1,659,066 -- 80,383,691 245,818,503 264,397,879 $

-- -- -- -- -- -- 309,093 170,039,793 -- -- -- -- -- 1,592,689 -- 66,667,912 238,609,487 258,627,073

150 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

DEFERRED INFLOWS OF RESOURCES
Deferred Gain on Debt Refunding
Deferred Funds Received in Advance of Timing Requirements
Deferred Service Concession Arrangements
Deferred Gain on Defined Benefit Pension Plans
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

University of Georgia

University of North Georgia

University of West Georgia

Valdosta State University

$

--$

1,966,018 $

-- -- 4,426,077

-- -- 489,676

-- 4,426,077

-- 2,455,694

--$
-- -- 396,488
-- 396,488

6,151,764
869,397 --
5,994,113
-- 13,015,274

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Capital Projects Higher Education Unrestricted (Deficit)

1,707,131,886 86,341,663 92,768,290
(282,801,835)

121,010,912 2,740,206 2,504,985
(29,773,058)

131,543,432 --
3,782,674
(8,113,043)

130,088,718 4,192,879 6,135,868
(30,785,526)

TOTAL NET POSITION

$

1,603,440,004 $

96,483,045 $

127,213,063 $

109,631,939

2017 Annual Financial Report 151

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

University System Office

Preliminary Total

Elimination/ Consolidation Entries

Consolidated Total

ASSETS

Current Assets

Cash & Cash Equivalents

$

Short-term Investments

Accounts Receivable, net

Federal Financial Assistance

Affiliated Organizations

Component Units

Primary Government

Other

Notes Receivable, net

Investment in Capital Leases - Primary Government

Investment in Capital Leases - Other

Inventories

Prepaid Items

Other Assets

Total Current Assets

Non-Current Assets Cash & Cash Equivalents Accounts Receivable, net Affiliated Organizations Component Units Due From USO - Capital Liability Reserve Fund Due From Institution - Capital Liability Reserve Fund Pledges & Contributions Other Investments Notes Receivable, net Investment in Capital Leases - Primary Government Investment in Capital Leases - Other Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS

DEFERRED OUTFLOWS OF RESOURCES Deferred Loss on Debt Refunding Deferred Loss on Defined Benefit Pension Plans Accumulated Decrease in Fair Value of Hedging Instruments
TOTAL DEFERRED OUTFLOWS OF RESOURCES $

700,238,480 $ 257,647,212
531,537 42,636 -- --
120,195,910 --
--
672,554 413,786 2,239,835 1,081,981,950

1,928,685,612 $ 265,926,182 -- 83,511,949 11,968,910 189,069,754 -- 296,461,286 --
-- -- 23,652,977 58,399,894 2,239,835 2,859,916,399

--
-- --
--
700,000 -- --
6,534,026 1,248,008
-- -- -- -- -- 3,612,043 511,393,363 523,487,440 1,605,469,390

-- -- 3,600,830 3,096,400
21,094,874
700,000 -- --
240,151,830 42,592,089
-- -- -- 6,006,227 20,876 186,673,642 9,962,908,062 10,466,844,830 13,326,761,229

-- 18,916,210
-- 18,916,210 $

28,001,793 861,120,615
-- 889,122,408 $

(412,754,038) $ (234,482,758)
-- -- --
-- (40,495,599)
--
-- -- -- -- -- (687,732,395)

1,515,931,574 31,443,424 -- 83,511,949 11,968,910
189,069,754 --
255,965,687 --
-- -- 23,652,977 58,399,894 2,239,835 2,172,184,004

-- -- -- --
(21,094,874)
(700,000) -- -- --
(1,248,008)
-- -- -- -- -- -- -- (23,042,882) (710,775,277)

-- -- 3,600,830 3,096,400
--
-- -- -- 240,151,830 41,344,081
-- -- -- 6,006,227 20,876 186,673,642 9,962,908,062 10,443,801,948 12,615,985,952

(2) 2
-- --$

28,001,791 861,120,617
-- 889,122,408

152 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

LIABILITIES Current Liabilities Accounts Payable Salaries Payable Benefits Payable Contracts Payable Retainage Payable Interest Payable Due to Affiliated Organizations Due to Component Units Due to USO - Capital Liability Reserve Fund Advances (Including Tuition & Fees) Deposits Deposits Held for Other Organizations Other Liabilities Notes & Loans Payable Lease Purchase Obligations - External Lease Purchase Obligations - Component Units Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Pollution Remediation Claims & Judgments Compensated Absences Total Current Liabilities

University System Office

Preliminary Total

Elimination/ Consolidation Entries

Consolidated Total

$

8,825,167 $

199,049,433 $

(46,312,501) $

152,736,932

207,528

26,687,684

--

26,687,684

51,688,179

67,571,355

--

67,571,355

--

28,459,019

--

28,459,019

--

8,608,245

--

8,608,245

--

6,338,779

6,338,779

--

1,741,850

3,653

1,745,503

--

9,029,870

(3,653)

9,026,217

--

321,895

(321,895)

--

553,534

226,262,793

--

226,262,793

--

16,165,362

--

16,165,362

717,413,148

764,737,340

(668,331,670)

96,405,670

--

3,982,936

(899,982)

3,082,954

--

1,547,071

(138,559)

1,408,512

2,333,022

18,890,685

2,716,946

21,607,631

--

75,029,939

(2,716,946)

72,312,993

--

--

--

--

--

--

--

--

--

--

--

--

--

618,915

--

618,915

--

903,825

--

903,825

2,977,636

142,933,292

--

142,933,292

783,998,214

1,592,541,509

(709,665,828)

882,875,681

Non-Current Liabilities

Due to Affiliated Organizations

Due to Primary Government

Due to Other Funds

Advances (Including Tuition & Fees)

Other Liabilities

Notes & Loans Payable

Lease Purchase Obligations - External

Lease Purchase Obligations - Component Units

Revenue Bonds & Notes Payable

Liabilities Under Split Interest Agreements

Interest Rate Swap

Pollution Remediation

Claims & Judgments

Compensated Absences

Other Post Employment Benefits Obligation

Net Pension Liability

Total Non-Current Liabilities

TOTAL LIABILITIES

$

-- -- -- -- -- -- 39,401,904 -- -- -- -- -- -- 1,424,357 -- 57,459,356 98,285,617 882,283,831 $

-- -- -- 2,295 -- 9,205,233 583,852,039 2,365,146,395 -- -- -- 609,515 1,786,568 77,302,748 -- 3,147,202,798 6,185,107,591 7,777,649,100 $

-- -- -- -- -- (1,109,449) 99,957,205 (99,957,205) -- -- -- -- -- 1 2,616,065,894 -- 2,614,956,446 1,905,290,618 $

-- -- -- 2,295 -- 8,095,784 683,809,244 2,265,189,190 -- -- -- 609,515 1,786,568 77,302,749 2,616,065,894 3,147,202,798 8,800,064,037 9,682,939,718

2017 Annual Financial Report 153

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY INSTITUTION (Unaudited) JUNE 30, 2017

DEFERRED INFLOWS OF RESOURCES
Deferred Gain on Debt Refunding
Deferred Funds Received in Advance of Timing Requirements
Deferred Service Concession Arrangements
Deferred Gain on Defined Benefit Pension Plans
Accumulated Increase in Fair Value of Hedging Instruments
TOTAL DEFERRED INFLOWS OF RESOURCES

University System Office

Preliminary Total

Elimination/ Consolidation Entries

Consolidated Total

$

--$

34,141,243 $

2,239,835 533,773,610
272,890

37,507,642 599,866,404
58,059,241

-- 536,286,335

-- 729,574,530

--$
-- -- --
-- --

34,141,243
37,507,642 599,866,404
58,059,241
-- 729,574,530

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Capital Projects Higher Education Unrestricted (Deficit)

292,965,435 3,612,043
11,108,347
(101,870,391)

6,627,744,225 --
193,258,875 249,285,321
(1,361,628,415)

-- -- -- (249,285,321) 16,754,205 232,531,116 (2,616,065,894)

6,627,744,225 --
193,258,875 --
16,754,205 232,531,116 (3,977,694,309)

TOTAL NET POSITION

$

205,815,434 $

5,708,660,006 $

(2,616,065,894) $

3,092,594,112

154 University System of Georgia

2017 Annual Financial Report 155

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

OPERATING REVENUES Student Tuition & Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)

Abraham Baldwin Agricultural College

Albany State University

Armstrong State University

Atlanta Metropolitan State College

$

10,571,770 $

21,081,397 $

36,069,921 $

--

--

4,673,303 --

124,861 -- --
126,553 111,173

7,944,017 2,108,052 2,614,200
259,342 14,727

2,304,990 157,326
1,114,710 188,743 --

2,546,240 5,823 7,626 8,884
171,596

2,132,609 2,611,213 3,184,479
214,985 457,613 573,294 417,036
-- -- 190,780

9,684,967 425,566
4,871,546 70,554
424,528 2,049,023
345,062 -- --
268,157

3,585,673 335,924
3,909,093 402,803 274,427
2,769,070 2,716,980
191,112

-- 113,106 114,509
-- -- 421,114 9,416 -- -- 188,458

20,716,366

52,161,138

54,020,772

8,260,075

6,977,933 9,257,797 6,796,021
257,495 395,811 5,757,148 952,792 12,126,651 3,155,258

19,174,882 25,659,362 16,717,092
411,087 510,186 10,327,879 3,892,700 20,640,528 9,523,156

22,036,444 21,946,680 13,963,674
476,899 793,352 11,092,888 2,568,802 20,196,660 5,130,191

4,642,660 8,943,146 4,836,534
115,651 122,689 3,854,431 829,000 3,847,395 1,214,238

45,676,906

106,856,872

98,205,590

28,405,744

$

(24,960,540) $

(54,695,734) $

(44,184,818) $

(20,145,669)

156 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Abraham Baldwin Agricultural College

Albany State University

Armstrong State University

Atlanta Metropolitan State College

$

16,629,765 $

34,446,379 $

32,275,899 $

10,616,567

8,026,502 33,257
652,509 422,510
119 (7,431) (1,619)

16,828,614 --
7,347 1,306,191
71,875 (5,808,466)
72,045

12,566,243 -- --
470,462 425,992 (1,419,922) (168,286)

8,108,457 -- --
240,433 --
(630,582) 3,475

Net Nonoperating Revenues

25,755,612

46,923,985

44,150,388

18,338,350

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

795,072

(7,771,749)

(34,430)

(1,807,319)

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item

-- 2,539,555
835,088 --
(19,497)

-- 1,146,445
100,000 -- --

1,636,691

-- 1,348,219
23,503 -- --

Total Other Revenues, Expenses, Gains or Losses

3,355,146

1,246,445

1,636,691

1,371,722

Change in Net Position Net Position, Beginning of Year, Restated

4,150,218 45,840,485

(6,525,304) 53,810,951

1,602,261 63,987,327

(435,597) 11,846,138

Net Position, End of Year

$

49,990,703 $

47,285,647 $

65,589,588 $

11,410,541

2017 Annual Financial Report 157

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

OPERATING REVENUES Student Tuition & Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)

Augusta University

Bainbridge State College

Clayton State University

College of Coastal Georgia

$

88,406,111 $

--

4,505,687 $ --

28,169,076 $ --

7,149,233 --

56,994,286 230,211,800 228,474,860
9,401,577 346,122

565,066 1,552,109
35,500 9,578
50,766

1,231,749 94,429
152,648 1,777,507
69,987

19,570 -- --
111,114 1,840

3,888,820 1,845,069 1,136,833 3,189,528 2,330,164 3,058,368 3,848,679
-- -- 267,574

-- 52,102
2,081 70,980
-- -- -- -- -- 188,945

6,808,193 2,850,606
295,845 521,172 705,054 2,335,205 344,539
-- -- 860,205

1,012,833 271,332
2,177,673 -- --
1,174,739 980,585 -- -- 104,304

633,399,791

7,032,814

46,216,215

13,003,223

173,381,811 248,371,709 139,646,583
341,695 4,260,152 9,288,780 10,590,512 228,271,076 28,011,451

842,163,769

$

(208,763,978) $

4,208,867 4,184,022 2,856,963
71,371 76,756 3,409,771 611,134 2,018,366 1,817,498
19,254,748
(12,221,934) $

20,456,548 21,478,212 14,141,367
502,099 435,697 9,000,045 2,661,560 13,447,383 5,578,183
87,701,094
(41,484,879) $

7,981,040 8,558,786 5,254,557
98,709 292,817 3,051,038 767,971 8,234,597 2,970,837
37,210,352
(24,207,129)

158 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Augusta University

Bainbridge State College

Clayton State University

College of Coastal Georgia

$

199,132,523 $

6,825,227 $

24,669,027 $

14,514,442

9,837,028 --
3,500,000 12,274,245
1,970,804 (2,044,671)
(440,259)

5,385,602 -- --
128,452 106,199 (1,135,557) (13,906)

16,638,617 --
522,598 210,353 148,924 (4,229,400) (3,049,584)

7,099,908 72,785
989,330 401,451
22,846 (614,341)
(13,276)

Net Nonoperating Revenues

224,229,670

11,296,017

34,910,535

22,473,145

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

15,465,692

(925,917)

(6,574,344)

(1,733,984)

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item

-- 8,837,521
276,500 --
(5,265,951)

-- 228,475
-- 66,080
--

-- 223,228
-- -- --

-- 1,108,106
-- -- --

Total Other Revenues, Expenses, Gains or Losses

3,848,070

294,555

223,228

1,108,106

Change in Net Position Net Position, Beginning of Year, Restated

19,313,762 211,418,148

(631,362) 25,185,343

(6,351,116) 39,149,611

(625,878) 51,392,916

Net Position, End of Year

$

230,731,910 $

24,553,981 $

32,798,495 $

50,767,038

2017 Annual Financial Report 159

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

OPERATING REVENUES Student Tuition & Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)

Columbus State University

Dalton State College

East Georgia State College

Fort Valley State University

$

46,233,797 $

--

9,925,528 $ --

4,364,180 $ --

8,735,336 6,697,562

1,001,227 105,526 212,973
3,922,657 41,800

5,526 52,266 2,580,060
7,665 1,732

89,177 138,270
18,426 2,345 1,620

1,541,751 53,156 38,157
304,703 255,115

3,817,569 360,155 452,615
1,218,715 625,171
2,753,088 353,100 -- -- 563,584

524,668 329,033 711,046 630,319 280,981 778,660 440,715
-- -- 313,457

600,699 113,785 1,104,809 243,975
70,660 623,537
5,189 -- --
84,908

6,431,026 31,923
3,966,319 183,802 339,569
1,427,476 944,738 -- -- 390,042

61,661,977

16,581,656

7,461,580

31,340,675

25,879,999 29,917,231 18,938,335
391,140 797,256 10,513,211 4,206,686 25,795,708 5,226,445

121,666,011

$

(60,004,034) $

11,367,500 8,989,226 7,920,074 139,924 254,185 5,310,393 1,306,580 7,560,060 1,955,662
44,803,604
(28,221,948) $

4,891,790 5,973,162 4,237,321
83,814 123,499 4,613,026 563,306 3,378,472 804,493
24,668,883
(17,207,303) $

9,182,764 18,754,902
9,919,943 464,066 939,847
4,863,215 4,206,598 22,950,120 6,443,922
77,725,377
(46,384,702)

160 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Columbus State University

Dalton State College

East Georgia State College

Fort Valley State University

$

36,713,844 $

15,248,377 $

8,442,439 $

20,799,672

14,496,905 --
4,230,919 432,164 476,220
(2,398,325) (10,570)

10,361,589 -- --
860,244 2,861
(353,482) --

8,435,237 51,585
310,062 60,141 6,919 (398) (4,877)

25,228,660 970
716,695 1,660,465
12,142 (2,545,889)
(5,500)

Net Nonoperating Revenues

53,941,157

26,119,589

17,301,108

45,867,215

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

(6,062,877)

(2,102,359)

93,805

(517,487)

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item

-- 3,063,414
16,702 -- --

-- 1,653,307
429,252 -- --

-- 3,282,623
-- -- --

(12,772) 346,853
-- -- --

Total Other Revenues, Expenses, Gains or Losses

3,080,116

2,082,559

3,282,623

334,081

Change in Net Position Net Position, Beginning of Year, Restated

(2,982,761) 51,241,655

(19,800) 33,157,156

3,376,428 16,188,254

(183,406) 40,430,731

Net Position, End of Year

$

48,258,894 $

33,137,356 $

19,564,682 $

40,247,325

2017 Annual Financial Report 161

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

OPERATING REVENUES Student Tuition & Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)

Georgia College & State University

Georgia Gwinnett College

Georgia Highlands College

Georgia Institute of Technology

$

57,447,517 $

34,891,112 $

12,111,692 $

361,845,835

--

--

--

--

509,366 96,846
127,401 2,670,863
60,764

867,367 244,087 394,840
65,524 8,175

214,100 111,557 320,385 241,178 164,106

545,314,270 8,125,597
233,235,552 39,106,996 478,891

14,642,594 1,113,106 7,520,079 1,552,586 -- 2,400,118 374,128 -- -- 530,296

7,762,423 757,986
1,099,272 2,530,055
646,928 3,944,465
212,957 -- --
141,835

-- 302,622
(350) 115,104
-- 1,116,711
236,005 -- --
214,453

76,211,897 2,123,424 3,473,273
19,627,886 10,373,070
-- 2,154,699
-- -- 6,634,095

89,045,664

53,567,026

15,147,563

1,308,705,485

28,720,773 32,638,166 22,749,180
276,014 1,083,326 2,778,270 3,582,917 29,663,310 8,904,622

38,980,747 24,569,149 19,968,872
371,736 679,295 10,769,266 2,567,706 25,340,303 9,364,713

130,396,578

132,611,787

$

(41,350,914) $

(79,044,761) $

8,943,515 9,324,516 6,465,677
89,802 255,183 5,658,686 1,399,472 8,654,054 1,911,137
42,702,042
(27,554,479) $

417,592,010 365,719,734 208,114,544
730,607 26,659,547 16,342,204 29,456,813 375,163,096 96,856,546
1,536,635,101
(227,929,616)

162 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Georgia College & State University

Georgia Gwinnett College

Georgia Highlands College

Georgia Institute of Technology

$

37,490,685 $

53,090,345 $

15,867,015 $

267,514,001

6,626,800 248,230
1,459,269 158,823 987,733
(6,292,338) (72,271)

28,782,311 -- --
2,235,261 131,537
(11,511,365) (123,017)

10,817,667 -- --
577,729 5,366
(908,874) (90,793)

11,122,453 -- --
2,738,147 21,525,736 (24,679,352)
1,037,036

Net Nonoperating Revenues

40,606,931

72,605,072

26,268,110

279,258,021

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

(743,983)

(6,439,689)

(1,286,369)

51,328,405

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item

-- 4,953,119
333,675 15,597 --

-- 12,449,593
673,334 -- --

-- 288,116
-- -- --

-- 6,485,524
793,930 746,123
--

Total Other Revenues, Expenses, Gains or Losses

5,302,391

13,122,927

288,116

8,025,577

Change in Net Position Net Position, Beginning of Year, Restated

4,558,408 34,545,118

6,683,238 70,491,461

(998,253) 21,923,107

59,353,982 1,368,205,155

Net Position, End of Year

$

39,103,526 $

77,174,699 $

20,924,854 $

1,427,559,137

2017 Annual Financial Report 163

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

OPERATING REVENUES Student Tuition & Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)

Georgia Southern University

Georgia Southwestern

State University

Georgia State University Gordon State College

$

117,350,971 $

--

12,950,184 $ --

294,825,347 $ --

6,328,647 --

5,113,356 583,536
9,268,421 6,035,912
460,149

312,955 173,187 2,284,973
2,473 23,568

83,127,702 9,666,465
33,909,361 27,799,480
132,754

162,300 157,786
8,400 123,370
66,201

31,297,264 11,636,351 21,115,330
4,508,191 4,783,852 17,441,031
39,971 -- --
2,840,119

4,256,636 1,060,411 2,737,016
75,894 358,365 1,054,101 385,155
-- -- 205,164

18,061,115 2,282,917
12,817,467 8,379,575 3,593,403
19,150,216 6,536,774 -- -- 2,388,309

4,905,403 1,887,683 2,378,633
105,346 61,196
518,643 70,156 -- --
184,203

232,474,454

25,880,082

522,670,885

16,957,967

65,144,710 97,575,033 57,410,562
985,914 3,357,176 15,730,865 11,683,876 76,213,387 27,985,354

356,086,877

$

(123,612,423) $

9,475,266 8,876,203 6,759,567
103,688 333,338 2,816,462 1,599,538 10,150,313 3,657,005
43,771,380
(17,891,298) $

200,978,814 242,033,831 128,161,490
2,154,405 7,054,165 55,783,182 19,507,235 151,450,428 50,366,423
857,489,973
(334,819,088) $

8,982,318 7,282,082 5,702,990
125,871 225,366 3,428,707 1,803,169 9,184,171 3,564,512
40,299,186
(23,341,219)

164 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Georgia Southern University

Georgia Southwestern

State University

Georgia State University Gordon State College

$

95,012,262 $

10,540,019 $

262,361,384 $

12,439,726

29,690,070 -- --
4,146,512 746,541
(11,519,630) (23,957)

5,028,208 -- --
765,087 73,270
(1,814,500) (1,500)

93,472,356 --
4,453,592 690,887
1,344,910 (14,560,937)
(602,586)

8,960,075 -- --
378,770 78,957
(2,062,519) (53,354)

Net Nonoperating Revenues

118,051,798

14,590,584

347,159,606

19,741,655

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

(5,560,625)

(3,300,714)

12,340,518

(3,599,564)

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item

-- 8,982,927
82,900 -- --

-- 57,210
-- -- --

-- 12,173,054 16,658,939
-- 8,635,267

-- 263,905 150,000
-- --

Total Other Revenues, Expenses, Gains or Losses

9,065,827

57,210

37,467,260

413,905

Change in Net Position Net Position, Beginning of Year, Restated

3,505,202 277,263,255

(3,243,504) 46,328,814

49,807,778 561,268,918

(3,185,659) 39,009,386

Net Position, End of Year

$

280,768,457 $

43,085,310 $

611,076,696 $

35,823,727

2017 Annual Financial Report 165

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

OPERATING REVENUES Student Tuition & Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)

Kennesaw State University

Middle Georgia State University

Savannah State University

South Georgia State College

$

193,196,541 $

--

22,528,066 $ --

13,851,127 $ --

3,035,088 --

1,946,428 879,075 154,392
12,731,745 1,012,363

54,953 --
678 858,740 158,587

9,310,329 62,967
412,362 983,692
51,235

13,172 5,400 --
18,039 2,415

17,103,480 13,913,170 27,627,130 10,087,308
3,573,891 14,994,671
5,913,574 -- --
2,490,627

8,525,378 3,153,058 3,911,606
205,849 268,799 1,742,539 394,299
-- -- 763,856

15,593,215 238,416
10,783,685 983,659 629,413
4,046,258 106,440
-- 1,577,820

1,203,376 1,134,125
815,322 6,539 --
457,545 81,652 -- -- 87,124

305,624,395

42,566,408

58,630,618

6,859,797

103,713,764 120,488,694
71,330,792 1,791,931 3,411,172
27,108,431 9,824,873
104,716,887 31,884,881

474,271,425

$

(168,647,030) $

21,463,635 19,798,071 14,798,825
204,011 658,863 7,461,645 3,344,692 24,476,819 8,141,992
100,348,553
(57,782,145) $

15,744,287 21,293,353 13,499,763
475,132 974,230 7,174,074 3,636,160 28,088,126 7,128,355
98,013,480
(39,382,862) $

4,706,037 4,922,002 3,714,305
275,976 252,179 2,689,719 1,293,922 4,864,230 2,376,105
25,094,475
(18,234,678)

166 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

Kennesaw State University

Middle Georgia State University

Savannah State University

South Georgia State College

$

128,128,428 $

32,069,443 $

22,703,668 $

10,859,830

55,712,429 312,426
5,280,852 1,147,657
757,792 (16,005,862)
(217,200)

15,683,546 963,184 498,914
4,274,737 196,863
(4,693,866) 263,312

16,847,003 -- --
1,111,705 705,048
(4,614,002) 134,228

6,640,455 --
69,476 402,610
34,101 (1,933,773)
(7,026)

Net Nonoperating Revenues

175,116,522

49,256,133

36,887,650

16,065,673

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

6,469,492

(8,526,012)

(2,495,212)

(2,169,005)

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item

-- 2,799,370 7,967,015
-- --

-- 12,908,386
-- -- --

-- -- 75,000 -- --

-- 2,771,091
-- -- --

Total Other Revenues, Expenses, Gains or Losses

10,766,385

12,908,386

75,000

2,771,091

Change in Net Position Net Position, Beginning of Year, Restated

17,235,877 212,325,030

4,382,374 106,787,674

(2,420,212) 25,239,201

602,086 12,071,925

Net Position, End of Year

$

229,560,907 $

111,170,048 $

22,818,989 $

12,674,011

2017 Annual Financial Report 167

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

OPERATING REVENUES Student Tuition & Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)

University of Georgia

University of North Georgia

University of West Georgia

Valdosta State University

$

453,158,505 $

15,610,091

74,812,403 $ --

67,102,516 $ --

61,457,736 --

134,408,064 27,201,677 74,377,754 79,392,840 556,842

-- -- -- 2,856,802 148,622

1,933,328 510,202
1,622,570 546,404 164,535

1,338,949 629,561
1,030,345 1,071,702 1,032,370

56,151,094 5,515,427
50,135,143 22,858,206 22,626,772 31,188,414
59,114 -- --
2,548,127

10,183,227 6,491,085
10,116,741 5,161,764 979,499 3,349,565 64,272 -- -- 1,306,258

19,633,356 2,903,849
12,053,976 1,836,274 2,306,132 6,949,795 394,279 -- --
10,715,752

13,441,629 1,277,054
11,096,305 4,211,355 2,852,490 3,268,041 460,431 -- -- 686,090

975,788,070

115,470,238

128,672,968

103,854,058

257,366,603 516,340,664 267,821,812
780,968 18,750,002 35,832,727 34,132,185 270,262,915 94,554,767

1,495,842,643

$

(520,054,573) $

46,158,943 48,183,394 36,484,927
664,346 1,772,913 13,734,118 4,484,341 40,794,510 15,027,424
207,304,916
(91,834,678) $

43,459,858 50,724,867 34,640,819
711,276 1,581,589 10,927,462 3,862,031 42,216,527 14,151,260
202,275,689
(73,602,721) $

36,919,449 34,734,878 25,349,466
2,272,971 1,381,351 13,739,463 5,242,386 37,214,517 17,262,892
174,117,373
(70,263,315)

168 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

University of Georgia

University of North Georgia

University of West Georgia

Valdosta State University

$

435,718,535 $

60,995,527 $

52,460,243 $

46,878,314

27,836,288 6,729,439
43,106,818 19,003,663 10,103,195 (14,887,216) 11,341,259

27,127,095 233,983
3,411,441 1,019,801
126,440 (6,771,216)
(43,753)

24,940,373 -- --
672,100 451,522 (9,118,901) 130,241

20,289,917 172,384 116,092
1,196,956 953,090
(7,756,816) (4,923)

Net Nonoperating Revenues

538,951,981

86,099,318

69,535,578

61,845,014

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

18,897,408

(5,735,360)

(4,067,143)

(8,418,301)

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item

1,409,446 114,608,033
7,582,188 -- --

-- -- 116,000 -- --

-- 2,349,827
62,399 --
(1,129,959)

-- 3,665,648
186,842 5,358 --

Total Other Revenues, Expenses, Gains or Losses

123,599,667

116,000

1,282,267

3,857,848

Change in Net Position Net Position, Beginning of Year, Restated

142,497,075 1,460,942,929

(5,619,360) 102,102,405

(2,784,876) 129,997,939

(4,560,453) 114,192,392

Net Position, End of Year

$

1,603,440,004 $

96,483,045 $

127,213,063 $

109,631,939

2017 Annual Financial Report 169

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

OPERATING REVENUES Student Tuition and Fees (net) Federal Appropriations Grants & Contracts Federal State Other Sales & Services Rents & Royalties Auxiliary Enterprises Residence Halls Bookstore Food Services Parking/Transportation Health Services Intercollegiate Athletics Other Organizations Gifts & Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Faculty Salaries Staff Salaries Employee Benefits Other Personal Services Travel Scholarships & Fellowships Utilities Supplies & Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)

University System Office

Preliminary Total

Elimination/ Consolidation Entries

Consolidated Total

$

--$

889,141,982 $

(628,001) $

888,513,981

--

15,610,091

--

15,610,091

--

--

--

$

37,757

149,042,980

(3,513,032)

145,529,948

--

29,288,882

(2,968,557)

26,320,325

89,750

77,687,851

(545,299)

77,142,552

49,353,124

147,813,088

(28,054,981)

119,758,107

120,545

3,247,514

--

3,247,514

--

--

--

10,382,978

152,217,733

(16,185,952)

136,031,781

--

34,626,184

--

34,626,184

--

126,539,908

--

126,539,908

--

45,350,954

--

45,350,954

--

33,236,996

--

33,236,996

--

65,996,828

--

65,996,828

--

7,474,061

--

7,474,061

--

--

--

--

--

--

--

--

447,739,240

467,914,894

(308,649,836)

159,265,058

507,723,394

2,245,189,946

(360,545,658)

1,884,644,288

-- 41,065,853 16,091,093
541 1,165,182
315,190 6,018,267 575,879,779 20,847,192

529,532,576 857,551,776 483,731,802
7,177,152 29,947,481 118,982,829 71,838,857 1,128,514,310 211,374,868

-- -- (33,297,056) -- -- -- -- (67,518,063) --

529,532,576 857,551,776 450,434,746
7,177,152 29,947,481 118,982,829 71,838,857 1,060,996,247 211,374,868

661,383,097

3,438,651,651

(100,815,119)

3,337,836,532

$

(153,659,703) $

(1,193,461,705) $

(259,730,539) $

(1,453,192,244)

170 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY INSTITUTION FOR FISCAL YEAR ENDED JUNE 30, 2017 (Unaudited)

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants & Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)

University System Office

Preliminary Total

Elimination/ Consolidation Entries

Consolidated Total

$

185,527,825 $

975,341,813 $

--

5,573,971

200,651,077

--

8,411,416

14,927,906

67,411,499

--

28,829,229

2,623,354

15,951,405

(1,727,568)

(67,509,220)

(15,038,799)

(3,442,661)

6,697 $ -- -- -- -- --
(74,079) 74,079 (6,697)

975,348,510 --
200,651,077 8,411,416
67,411,499 28,829,229 15,877,326 (67,435,141) (3,449,358)

Net Nonoperating Revenues

191,886,689

1,225,644,558

--

1,225,644,558

Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

38,226,986

32,182,853

(259,730,539)

(227,547,686)

Capital Grants & Gifts Federal State Other
Additions to Permanent & Term Endowments Special Item

-- 233,316 2,579,103
-- --

1,409,446 139,335,671
18,568,547 5,358
(1,129,959)

--

1,409,446

--

139,335,671

--

18,568,547

--

5,358

--

(1,129,959)

Total Other Revenues, Expenses, Gains or Losses

2,812,419

158,189,063

--

158,189,063

Change in Net Position Net Position, Beginning of Year, Restated

41,039,405 164,776,029

190,371,916 2,328,435,524

(259,730,539) (2,356,335,355)

(69,358,623) (27,899,831)

Net Position, End of Year

$

205,815,434 $

2,518,807,440 $

(2,616,065,894) $

(97,258,454)

2017 Annual Financial Report 171

172 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

Abraham Baldwin Agricultural College Foundation, Inc. &
Subsidiaries

Albany State University Foundation, Inc.

Armstrong State University Educational Properties Foundation,
Inc. & Subsidiaries

Armstrong State University Foundation,
Inc.

Atlanta Metropolitan State College Projects
Foundation, Inc.

Atlanta Metropolitan State College
Foundation, Inc.

$

2,667,930 $

1,874,381 $

2,386,557 $

2,942,915 $

--

1,008,080

7,311

--

--

585,389

--

--

--

1,028,414

--

--

--

4,979

--

2,675,241

1,874,381

4,428,030

3,528,304

260,440 $ 20 --
260,460

5,210 21,405,633
-- 229,746
4,183,650 25,824,239 28,499,480
--

-- -- -- -- 64,010,243 14,394,096 -- -- 1,760,685 733,875 80,898,899 82,773,280
--

38,039,777
-- 2,940,311
2,784,948 43,765,036 48,193,066
2,301,532

1,195,535 9,744,056
--
10,939,591 14,467,895
--

361,396 --
--
9,613,775 9,975,171 10,235,631
--

432,713 -- --
432,713 -- --
-- 432,713
--

831

86,931

68,791

--

566,628

--

10,558

--

--

--

--

--

--

760,000

--

1,688,525

--

99,631

--

831

1,875,087

1,405,977

--

--

--

--

69,835,581

--

--

--

--

39,702,294

--

--

--

--

--

--

--

--

69,835,581

39,702,294

831

71,710,668

41,108,271

--

--

32,716

--

101,288

270,000

--

--

--

--

--

371,288

--

--

10,469,316

--

--

--

--

--

10,469,316

--

10,840,604

--

--

4,183,650

--

9,118,988 5,585,982 9,610,029

1,110,230 1,250,040 8,702,342

$

28,498,649 $

11,062,612 $

2,784,948
1,747,329 --
4,821,334 9,353,611 $

5,708,561 8,346,645
412,689
14,467,895 $

-- -- (604,973)
(604,973) $

1,911
--
-- 1,911
-- --
-- -- 1,911 --
-- 50,000 380,802 430,802

2017 Annual Financial Report 173

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES

Augusta University Foundation, Inc.

Augusta University Research Institute, Inc.

Augusta University College of Dental Medicine Faculty Practice Group d/b/a AU Dental Faculty Practice Group

AU Health System Inc AU Medical Associates

Bainbridge State College Foundation

$

544,073 $

8,395,707 $

2,579,545 $

36,607,910 $

9,752,279 $

1,466,910

38,494,241

13,471,819

456,654

5,272,814

992,257

131,113,623

13,815,574

1,051,395 885
3,519,917

-- 13,668,521

-- 118,949 3,690,751

-- 19,002,610 16,525,792
-- 241,744,176

1,151,040 538,736
38,729,448

4,308,982 456,392
7,776,876
25,095,150 522,500

69,973 --
291,102
--

-- 13,486,988
--

-- 95,322,236
201,290 --
6,353,031

-- 25,338,392
23,706,252 2,183,441

76,575 -- --
76,575
-- 2,186,774
--

19,539,674 897,307
58,596,881 62,116,798
--

361,075 14,029,596
--

13,486,988 17,177,739
--

262,810,454 364,687,011 606,431,187
--

6,725,011 57,953,096 96,682,544
--

2,186,774 2,263,349
--

LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES

785,092

5,549,447

14,994,924

81,206,553

21,235,243

--

3,445,833

--

--

--

5,932,665

--

--

900,000

3,950,000

865,000

82,445

16,536

--

25,207,566

3,018,972

--

1,767,537

5,565,983

14,994,924

119,742,617

25,119,215

--

--

--

--

--

--

--

376,000

37,037,500

--

--

--

24,048,493

--

--

24,158,605

110,420,000

23,854,028

20,812,794

--

--

--

8,682,920

2,102,916

--

11,531,792

24,534,605

--

--

201,001,707

37,488,736

--

26,302,142

5,565,983

14,994,924

320,744,324

62,607,951

--

--

--

--

--

--

--

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)

TOTAL NET POSITION

$

174 University System of Georgia

713,937
18,885,674 16,426,174
(211,129) 35,814,656 $

-- 69,973 8,393,640
8,463,613 $

-- -- 2,182,815
2,182,815 $

77,975,963
-- -- 207,710,900 285,686,863 $

6,725,011
-- -- 27,349,582 34,074,593 $

-- 2,263,349
2,263,349

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

Clayton State University Foundation,
Inc.

College of Coastal Georgia Foundation,
Inc.

Columbus State University Research &
Service Foundation

Columbus State University Alumni Association, Inc.

Columbus State University Athletic
Fund, Inc.

Columbus State University Foundation,
Inc.

$

2,112,951 $

505,619

1,352,557

35,122

4,006,249

617,406 $ --
100,097
--
15,399
732,902

5,707,417 246,151
6,823,229
56,833,841 2,028,520
534,556 1,600,937 7,260,558 81,035,209 85,041,458
--

18,594 13,686,708
-- 99,750
1,531,003 15,336,055 16,068,957
--

37,667 $ -- --
37,667 -- --

92,954 $ 50,258
5,102
-- 2,523 7,404
158,241
6,914 221,140
--

3,555 $ 22,000
-- 4,231 29,786
220,406 --
1,985,599 --

2,620,915
5,671,784
--
310,668 20,815,650 29,419,017
8,760,708 19,854,745 56,475,452
--

-- 37,667
--

228,054 386,295
--

7,224 2,213,229 2,243,015
--

85,090,905 114,509,922
--

3,360,336

179,858

--
-- 3,360,336
-- 4,446,454
-- 68,188,677
--

-- 2,355
-- 182,213
--
-- 16,403
--

72,635,131 75,995,467
--

16,403 198,616
--

7,260,558

1,531,003

3,538,410 5,205,719 (6,958,696)

6,819,830 5,708,842 1,810,666

$

9,045,991 $

15,870,341 $

-- 34,845
--
-- 34,845
-- --
-- -- 34,845 --

6,125 1,430
--
-- 7,555
-- --
-- -- 7,555 --

113,049

2,161,749 900

--
-- 113,049
-- --
-- -- 113,049 --

-- 76,293
-- 2,238,942
1,716,158
-- 764,221 21,404,791
23,885,170 26,124,112
--

-- --
--$

96,426 --
282,314
378,740 $

1,362,333 824,933 (57,300)
2,129,966 $

44,581,583 46,508,799 (2,704,572)
88,385,810

2017 Annual Financial Report 175

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION
176 University System of Georgia

Dalton State College Athletic Club

Dalton State College Foundation, Inc.

Darton Boosters, Inc.

Darton State College Foundation, Inc.

East Georgia State College Foundation,
Inc.

Fort Valley State University Foundation,
Inc.

194,529 1,478,720
--
1,673,249
-- --
1,381,164 1,381,164 3,054,413
--

2,857,900 2,491,743
-- 15,385 5,365,028
4,905 10,687,778
-- 107,698 14,061,361 5,661,266 30,523,008 35,888,036
--

24,407 1,602,174
-- 22,179,023
23,805,604
364,286 --
364,286 24,169,890
--

140,762 --
18,665 -- -- -- -- --
159,427
-- -- 3,882,614 -- -- -- -- -- -- 398,427 4,281,041 4,440,468
--

251,402 14,537 --

2,285,819 923,947 23,369
845,579

265,939
362,739 866,642
--
176,335 699,813 2,105,529 2,371,468
--

4,078,714
7,022,670 23,904
55,894,526 42,264
5,968,279
1,120,788 70,072,431 74,151,145
--

31,917

130,075

--

415,614

--

--

21,381,928

-- 31,917
--
--

-- 545,689
--
416,680 --

-- 21,381,928
--
--

--
-- 31,917
--
10,000 2,483,805
528,691 3,022,496

73,518
490,198 1,035,887
--
4,828,972 10,687,778
7,492,400 11,842,999 34,852,149

--
-- 21,381,928
--
-- -- 2,787,962 2,787,962

-- -- -- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- -- -- -- --
--
--
1,053,018 496,997
2,890,453
4,440,468

122

2,457,901

--
-- 122
--
--
--
-- 122
--
699,813 176,335 1,507,112 (11,914) 2,371,346

292,136 --
885,000
-- 3,635,037
-- 252,842
-- 60,045,940
--
60,298,782 63,933,819
--
1,907,503 3,957,224 5,039,904 (687,305) 10,217,326

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

Foundation Properties, Inc. (Columbus State
University)

Georgia Advanced Technology Ventures,
Inc.

Georgia Center for Medical Innovation

Georgia College & State University Alumni
Association, Inc.

Georgia College & State University Foundation

Georgia Gwinnett College Foundation,
Inc.

$

4,788,380 $

4,057,209 $

3,219,426

395,880

--

--

19,110 2,119
8,029,035

63,802 490,396 5,007,287

757,231 1,716,158 1,918,481
-- 653,449

1,107,809 620,852 15,000
--

275,966 $ 218,538
--
494,504 -- --

228,466 $ 1,500 -- 8,111
238,077
-- 8,042,970
-- 4,500

2,999,196 $ 284,714
2,146,083 29,508
5,459,501
173,804 35,022,134 84,779,839
692,305

1,673,085 94,304
11,205,484
12,972,873
7,146,999 282,640
4,066,870 152,530,613
11,314

98,076,541 103,121,860 111,150,895
--

90,674,940 92,418,601 97,425,888
--

1,922,076 1,922,076 2,416,580
--

22,774 8,070,244 8,308,321
--

15,352,780 3,032,988
139,053,850 144,513,351
--

10,763,142 174,801,578 187,774,451
--

32,109,025 11,130
1,000,000 --
1,730,000

324,980 872,253 153,327
740,435 1,516,529

226,612 35,076,767
--
7,629,168 --
44,801,000

764,478 4,372,002
-- 1,991,522 7,946,303 54,513,018

--

--

52,430,168 87,506,935
--

(55,160,168)

1,901,451 --
76,902,677

$

23,643,960 $

64,450,843 68,822,845
--
25,958,655
-- 8,128,464 (5,484,076) 28,603,043 $

548,467 75,353
--
-- 623,820
-- 415,000
--
210,918
625,918 1,249,738
--
1,922,076 -- --
(755,234) 1,166,842 $

17,148
--
-- 17,148
-- --
--

1,237,212 1,173,766
3,228,224 273,221 --
2,365,000
-- 8,277,423
--
373,458 --
94,724,297 846,253
9,643,001 --

1,381,813 500,000
111,586 --
1,800,000
3,741,162 --
7,534,561
--
2,262,728 --
171,236,654
--

-- 17,148
--

105,587,009 113,864,432
2,130,394

173,499,382 181,033,943
--

22,774
5,270,220 2,399,293
598,886 8,291,173 $

2,386,309
16,001,741 8,560,052 1,570,423
28,518,525 $

8,388,828
1,261,066 1,028,428 (3,937,814) 6,740,508

2017 Annual Financial Report 177

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

Georgia Health Sciences Foundation,
Inc.

Georgia Highlands College Foundation,
Inc.

Georgia Southern University Athletic Foundation, Inc.

Georgia Southern University Foundation,
Inc.

Georgia Southern Housing Foundation,
Inc.

Georgia Southern University Research & Service Foundation,
Inc.

$

263,626 $

10,196,373

4,770,347

--

58,754

15,289,100

604,302 $ 1,500
302,913 8,268
916,983

6,003,660 $
601,519
376,466
3,910 1,628,649 8,614,204

224,420 $ 34,934 --
903,771 1,163,125

2,918,837 $ 5,446,272
128,732
7,000,900
15,598
15,510,339

1,780,440 4,629,129
-- 522,500
2,423,183
9,355,252 24,644,352
--

491,426 --
18,253,705
--
909,254
1,045 19,655,430 20,572,413
--

1,715,083 1,523,681 1,263,671
20,305,871 14,596
2,860,838 27,683,740 36,297,944
--

1,105,770 59,961,089
-- 2,130,988

34,321,466 --
191,293,156 --

1,261,276 64,459,123 65,622,248
--

436,692 226,051,314 241,561,653
--

3,833,057 3,444,348
-- 1,673 37,125 7,316,203
--
--
-- 7,316,203
--

197,404 1,541,873

34,918

487,889 690,475

141,617

6,163,154

789,686 --
90,485 3,058
2,622,506
--
-- 203,461
--

-- 430,000
-- 464,918
--
-- 16,177,871
--

41,456 --
520,000
-- 1,739,820
-- 98,052
-- 21,148,678
--

--
-- 141,617
-- --
56,937

-- 7,443,201
-- 13,606,355
3,096,400
-- 194,670,669
4,911,828

203,461 2,825,967
--

16,177,871 16,642,789
--

21,246,730 22,986,550
--

56,937 198,554
--

202,678,897 216,285,252
--

2,423,183 15,336,006
4,059,196

$

21,818,385 $

1,045
927,680 1,769,641 1,231,258 3,929,624 $

1,734,990
1,097,919 6,899,415 3,579,070 13,311,394 $

1,261,276
36,464,164 22,412,790
5,285,464 65,423,694 $

436,692
-- 27,093,978 (2,254,269) 25,276,401 $

2,194,174
767,228 --
-- 2,961,402
--
--
--
-- 2,961,402 1,237,421
-- -- 3,117,380 3,117,380

178 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

Georgia Southwestern State University Foundation, Inc.

Georgia State University Alumni Association, Inc.

Georgia State University Foundation,
Inc.

Georgia State University Research Foundation Inc. and
Affiliates

Georgia Tech Alumni Association

Georgia Tech Athletic Association

$

3,896,591 $

--

1,104,110

--

--

--

3,687

--

5,004,388

4,703,818 --
61,259,370 -- --
14,834 -- -- --
664,732 66,642,754 71,647,142
--

301,613 $ 1,314,681
56,750 -- -- --
53,183 --
1,726,227
22,859 -- -- -- -- -- -- -- --
29,883 52,742 1,778,969
--

6,608,614 $
8,580,436
7,433,260
506,712 23,129,022
29,059,109 11,930,560 100,567,247
133,255,634 3,837,931
118,798,858 15,388,234
412,837,573 435,966,595
--

9,340,668 $ 22,462,067
-- 17,271,722 49,074,457
-- 8,449,855 72,366,210
9,145,925 89,961,990 139,036,447
8,774,458

379,723 $
65,256
-- 10,077 61,785
516,841

6,279,261 6,186,630
-- 1,159,416 13,625,307

--

5,287,450

105,609,000

--

--

728,270

331,932 331,932 848,773
--

164,857,696 276,482,416 290,107,723
18,624,539

-- -- -- -- 745,000 -- -- -- -- 123,790 868,790
-- -- 35,596,764 -- -- -- -- -- -- -- 35,596,764 36,465,554
--

--

12,565,262 14,460,410
8,155,916

$

35,181,588 $

45,439 2,275 -- -- -- -- -- -- -- --
47,714
-- -- -- -- -- -- -- -- -- -- -- 47,714
--

4,430,861 16,079,406
2,281,025
584,500 6,085,000
802,593 30,263,385
-- 1,297,669
617,900 129,003,422
1,690,023 10,881,060
6,346,539
149,836,613 180,099,998
--

24,078,932
--
-- 24,078,932
-- -- 81,500,392 -- 81,500,392 105,579,324 17,264,201

--
-- 33,833 1,697,422 1,731,255 $

15,388,234
128,335,053 88,583,822 23,559,488
255,866,597 $

9,145,925
-- 7,036,458 8,784,997 24,967,380 $

106,405 103,671
--

5,470,497 508,993
15,279,004
943,965 73,133
1,105,000

383,867 593,943
--
--

1,575,564 24,956,156
--
5,082,536 120,902
216,583,039

--

650,740

-- 593,943
--

222,437,217 247,393,373
--

331,932
-- -- (77,102) 254,830 $

(40,529,669)
38,323,155 57,810,372
5,735,031 61,338,889

2017 Annual Financial Report 179

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES

Georgia Tech Facilities, Inc.

Georgia Tech Foundation, Inc.

Georgia Tech Research Corporation

Georgia Tech Global

Gordon State College Foundation, Inc. & Subsidiaries

James M. Dye Foundation, Inc.

$

6,002,122 $

5,484,000 $

98,364,276 $

704,673 600,000 9,018,038

19,112,000 6,613,160

118,550,521 327,503

255,892

71,617

16,580,725

31,209,160

217,313,917

3,794,047 6,771,775
1,104,314 225,470,210
3,681,250

10,857,000 105,211,000 913,577,000
117,218,159 24,857,681

3 128
4,466,472

4,569,199 245,390,795 261,971,520
--

621,400,000 112,110,000 1,905,230,840 1,936,440,000
--

1,223,076 5,689,679 223,003,596
--

2,497,411 $ 8,209 --
11,785 2,517,405
3,700
--
32,328 36,028 2,553,433
--

497,053 $ --
6,407 --
42,206,003 -- -- --
42,709,463
-- -- 9,130,836 -- -- 5,442,681 -- -- -- -- 14,573,517 57,282,980
--

128,098 -- --
606 128,704
1,985 2,292,567
--
2,294,552 2,423,256
--

LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES

2,053,522 742,825
-- 9,254,450
-- 12,050,797
-- 5,000
-- 228,739,517
--
228,744,517 240,795,314

9,520,020 23,784,033
201,855
25,928,644 --
10,725,000 1,633,328
348,623 72,141,503
7,002,000
47,271,356 --
247,498,000 14,396,672
7,337,469
323,505,497 395,647,000

76,864,935 49,399,271 29,998,329
368,794
5,826,913 162,458,242
--
4,425,181
--
4,425,181 166,883,423

40,392 2,295,293
--
55,045 2,390,730
--
--
-- 69,177 69,177 2,459,907

6,457 -- -- -- -- --
1,031,900 -- -- --
1,038,357
-- -- -- -- 40,273,560 -- -- 1,965,087 -- -- 42,238,647 43,277,004

5,701
--
61,623 67,324
-- --
-- -- 67,324

TOTAL DEFERRED INFLOWS OF RESOURCES

--

--

--

--

--

--

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

4,569,215

47,569,500

1,223,076

-- 8,251,952 8,355,039

693,105,000 726,967,000
73,151,500

-- -- 54,897,097

$

21,176,206 $

1,540,793,000 $

56,120,173 $

-- -- 93,526
93,526 $

--
3,038,314 730,409
10,237,253 14,005,976 $

2,055,738 162,785 137,409
2,355,932

180 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

Kennesaw State University Athletic Association, Inc.

Kennesaw State University Foundation,
Inc.

Kennesaw State University Research & Service Foundation,
Inc.

Medical College of Georgia Foundation

Middle Georgia State University Foundation,
Inc. & Subsidiaries

Middle Georgia State University Real Estate
Foundation, Inc.

$

4,279,617 $

21,866,638 $

3,224,225 $

2,530,713 $

1,695,299

1,691,870

2,261,796

2,196,398

166,242

--

--

8,684,557

--

--

242,980

--

71,777

225,364

8,580

4,615

--

--

6,290,859

33,038,355

7,124,502

2,696,955

418,018 $ 239,187
--

261,264 119,743 1,617,112

657,205

1,998,119

49,890,104

--

3,107,937

17,982,990

--

229,550,273

2,217,604 2,217,604 8,508,463
--

33,172,960 92,002,158 425,706,422 458,744,777
--

-- -- -- -- -- -- -- -- -- -- -- 7,124,502
--

989,155 108,479,442
-- 300,291
127,714,592 5,487,039
242,970,519 245,667,474
--

327,237 11,767
-- 71,179
11,198,371 11,608,554 12,265,759
--

-- 15,381,804 92,178,377
789,332 108,349,513 110,347,632
--

2,185,711 676,091
400,000 --
-- 3,261,802
-- 758,334 788,823
--
--
1,547,157 4,808,959
--

12,343,866 1,288,440 36,469
-- 11,780,000
18,800
-- 25,467,575
--
-- 372,553,171
107,336
--
372,660,507 398,128,082
--

-- 493,925
-- -- -- -- -- -- -- -- 493,925
3,918,597 -- -- -- -- -- -- -- -- --
3,918,597 4,412,522
--

--
2,309,104 --
27,172 2,336,276
--
-- 945,194
--
945,194 3,281,470
--

378,757 204,451
--
-- 583,208
-- --
-- -- 583,208 --

2,309,235
-- 1,555,000
-- 3,864,235
-- 773,000
-- 91,242,763
--
92,015,763 95,879,998
--

1,028,781

(33,985,324)

3,177,935

1,014,058

-- 819,542 1,851,181

36,388,593 17,129,008 41,084,418

-- 547,911 2,164,069

127,714,592 77,800,657 33,692,820

9,021,922 2,412,901
247,728

-- 13,131,605
321,971

$

3,699,504 $

60,616,695 $

2,711,980 $

242,386,004 $

11,682,551 $

14,467,634

2017 Annual Financial Report 181

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES
TOTAL DEFERRED INFLOWS OF RESOURCES
NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION
182 University System of Georgia

Savannah State University Foundation,
Inc. & Subsidiaries

South Georgia State College Foundation, Inc. & Subsidiaries

Southern Polytechnic Applied Research Corporation

University of Georgia Athletic Association,
Inc.

University of Georgia Foundation

University of Georgia Research Foundation,
Inc.

$

439,105 $

1,022,236 $

754,555.18 $

45,805,638 $

17,685,430 $

36,727,235

198,370

113,570,412

309,475

--

217,889.3

2,485,558

21,652,353

36,468,706

--

--

--

--

--

7,990,341

6,046 952,996

24,038 1,046,274

972,444.48

742,999 49,034,195

381,599 --
153,289,794

227,249 20,382,914 101,796,445

5,532,871 --
81,539,485

-- 4,124,641
30,839,002 844,897

7,828,567

--

--

41,917,388

--

50,910,910

102,216,384

50,174,814

--

--

--

257,115,849

496,506

14,958,700

754,033

87,072,356 88,025,352
--

3,111,410 330,395
39,250,345 40,296,619
--

-- 972,444.48
--

274,453,063 325,860,479 374,894,674
15,520,702

819,440,998 24,929,865
1,003,463,335 1,156,753,129
--

19,523,537 335,396,800 437,193,245
16,534,037

564,970
--
9,385,534 --
9,950,504 --
1,584,960 --
74,838,038
--

86,979
-- 33,381,171
135,167 33,603,317
-- --
--

582,742.5

17,946,910 25,740,505

--
1,814.91 584,557.41
-- --
--

-- 2,865,000
-- 46,552,415
--
-- 101,403,529
3,961,146 494,297

4,147,635 641,469
5,586,136 --
745,760 1,878,813
-- 12,999,813
621,301
11,205,000 --
8,442,818 628,418 --

42,122,690 2,186,282
22,540,419
-- 9,605,000
-- 76,454,391
-- 1,769,494 8,516,222
-- 273,632,543
--

76,422,998 86,373,502
--

-- 33,603,317
--

-- 584,557.41
--

105,858,972 152,411,387
--

20,897,537 33,897,350
--

283,918,259 360,372,650
--

181,744,090

8,138,729

11,007,315

110,000 137,333 1,404,517

2,850,148 309,119
3,534,035

-- 10,922.11 376,964.96

-- -- 56,259,899

539,734,884 461,685,019 113,297,147

-- 2,063,519 80,283,798

$

1,651,850 $

6,693,302 $

387,887.07 $

238,003,989 $

1,122,855,779 $

93,354,632

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES

University of North Georgia Foundation -
Dahlonega, Inc.

University of North Georgia Real Estate
Foundation, Inc.

University of West Georgia Athletic Foundation, Inc.

University of West Georgia Foundation,
Inc.

UWG Real Estate Foundation, Inc.

University System of Georgia Foundation,
Inc. and Affiliates

$

(802,141) $

1,664,635 $

--

259,943

130,673

--

--

2,596,987

--

120,336

--

(542,198)

4,512,631

1,832,917 250,763
60,974,956
-- 60,333
587,442 63,706,411 63,164,213
--

21,312,956 -- -- --
118,405,379 -- -- -- --
10,078,248 149,796,583 154,309,214
--

528,480 $ 284,048
--
812,528
276,360 562,717
-- 94

3,187,439 $
1,050,445 371,681
1,316,717
15,336 --
5,941,618
1,684,097 3,828,274 28,830,085
-- 41,774,039
666,519 10,769,329

509,355 $ 667,842
--
2,419,019
-- 3,596,216
8,292,308 --
243,150
116,839,596

413,374 33,096
3,952,636
4,399,106
14,160,197 --
5,436,309 253,470,637
890

839,171 1,651,699
--

73,578 87,625,921 93,567,539
--

125,375,054 128,971,270
--

273,068,033 277,467,139
--

LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES

436,041
2,178,027 --
-- 2,614,068
--
-- 9,130
--
9,130 2,623,198

4,547,190 2,345,415
-- -- 438,750 -- 3,186,453 -- -- -- 10,517,808
-- -- 1,620,000 -- 133,430,344 -- -- -- -- -- 135,050,344 145,568,152

8,802 110,223
--
-- 119,025
-- --
-- -- 119,025

1,415,088
554,092 --
1,510,000 -- --
3,479,180
--
-- 45,256,179
79,805 --
45,335,984 48,815,164

1,177,979
-- 2,946,721
-- 4,124,700
--
-- 121,324,421
--
121,324,421 125,449,121

677,064
890 --
4,975,000
-- 5,652,954
-- 39,595,688
-- 230,763,309
--
270,358,997 276,011,951

TOTAL DEFERRED INFLOWS OF RESOURCES

--

--

--

--

--

--

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

587,442

27,733,310 28,093,116
4,127,147

$

60,541,015 $

2,861,423
-- -- 5,879,639 8,741,062 $

96,244
-- 1,811,597 (375,167) 1,532,674 $

73,578
20,994,376 13,134,429 10,549,992 44,752,375 $

-- -- 3,522,149
3,522,149 $

349,987 527,494 577,707
1,455,188

2017 Annual Financial Report 183

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) JUNE 30, 2017

ASSETS Current Assets Cash and Cash Equivalents Short-term Investments Accounts Receivable, net Notes Receivable, net Investment in Capital Leases Inventories Prepaid Items Other Assets Total Current Assets
Non-Current Assets Cash and Cash Equivalents Accounts Receivable, net Investments Notes Receivable, net Investment in Capital Leases Other Assets Non-current Cash (Externally Restricted) Short-term Investments (Externally Restricted) Investments (Externally Restricted) Capital Assets, net
Total Non-Current Assets TOTAL ASSETS
TOTAL DEFERRED OUTFLOWS OF RESOURCES

VSU Auxiliary Services Real Estate Foundation

Valdosta State University Foundation,
Inc.

Walter & Emilie Spivey Foundation

$

2,722,247 $

686,725

3,623,144

13,817

7,045,933

9,144,179 --

168,513,203

227,338 177,884,720 184,930,653
--

3,775,742 $
200 29,915
--
16,727
3,822,584
3,578,112 33,834,985
-- 977,398
919
7,340,012 45,731,426 49,554,010
--

62,647 $ 6,327,602
-- --
6,390,249
--
--
139,882 139,882 6,530,131
--

LIABILITIES Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Deposits Deposits Held for Other Organizations Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Total Current Liabilities
Non-Current Liabilities Accounts & Other Payable Advances (Including Tuition and Fees) Notes and Loans Payable Lease Purchase Obligations Revenue Bonds & Notes Payable Liabilities Under Split Interest Agreements Interest Rate Swap Other Liabilities Other Post Employment Benefits Obligation Net Pension Liability
Total Non-Current Liabilities TOTAL LIABILITIES

1,894,883
-- 3,035,000
-- 4,929,883
--
-- 167,191,153
6,310,954 --
173,502,107 178,431,990

76,593 254,333
107,711 72,539 --
266,581 53,975
-- 831,732
--
1,134,700 --
3,646,245 168,270 500,696 --
5,449,911 6,281,643

5,650
--
-- 5,650
-- --
-- -- 5,650

TOTAL DEFERRED INFLOWS OF RESOURCES

--

--

--

NET POSITION Net Investment in Capital Assets Restricted for: Nonexpendable Expendable Unrestricted (Deficit)
TOTAL NET POSITION

227,338

2,219,947

139,882

-- -- 6,271,325

31,312,886 9,945,805 (206,271)

-- -- 6,384,599

$

6,498,663 $

43,272,367 $

6,524,481 $

Total
394,487,378
422,862,426 1,001,596
122,312,175 19,267,974 38,557,186 44,734,826
1,263,783,997 -- --
240,440,746 250,535,253 2,083,172,318
1,305,604 2,617,452,016
87,684,185 14,618,894 20,565,115 1,775,690,783 1,261,394,073 8,353,486,686
-- 61,755,268
--
-- 392,841,891 132,086,258
38,221,632 37,176,795 45,982,132 29,857,549 124,955,477
2,620,996 16,694,034 38,761,470 859,198,233
-- -- 16,354,456 5,822,019 294,728,131 83,725,494 3,428,008,338 27,669,586 52,738,069 54,237,960 11,600,969 -- 3,974,885,022 4,834,083,255 -- 20,664,732 -- -- 311,593,486 -- 1,847,834,363 1,736,485,759 928,361,534 -- 4,824,275,142

184 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues

Abraham Baldwin Agricultural College Foundation, Inc. &
Subsidiaries

Albany State University
Foundation, Inc.

Armstrong State University Educational Properties
Foundation, Inc. & Subsidiaries

Armstrong State University
Foundation, Inc.

Atlanta Metropolitan State College
Projects Foundation, Inc.

Atlanta Metropolitan State College
Foundation, Inc.

$

215,551

213,491 $

4,199,918 $

1,081,714

--

--

--

--

--

--

1,141,024 623,823 45,488
2,239,377

1,234,422
199,788 5,634,128

$
1,922,429 3,004,143

4,462,567
$ 4,462,567

794,971 $ 794,971

145,588 145,588

OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses

347,065
57,485 815,032
4,105 1,409,385
79,887 2,712,959

--
2,666,018 2,666,018

22,730 36,310
12,130 1,454,183 1,525,353

--
203,836 44,287
679,906
397,993
1,326,022

--
497,331 497,331

--
91,078 37,825 128,903

Operating Income (Loss)

(473,582)

2,968,110

1,478,790

3,136,545

297,640

16,685

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

(944,391) 1,639,571
695,180 221,598

327,706 (3,410,661)
77,260 (3,005,695)
(37,585)

66,179 (2,042,683)
(1,976,504) (497,714)

820,745
820,745 3,957,290

(459,591)
(459,591) (161,951)

192
192 16,877

Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position

480,185
480,185 701,783

-- (37,585)

673,772
673,772 176,058

119,813
119,813 4,077,103

-- (161,951)

-- 16,877

Net Position, Beginning of Year Net Position-End of Year

27,796,866

11,100,197

$

28,498,649 $

11,062,612 $

9,177,553 9,353,611 $

10,390,792 14,467,895 $

(443,022) (604,973) $

413,925 430,802

2017 Annual Financial Report 185

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues

Augusta University Foundation, Inc.

Augusta University Research Institute,
Inc.

Augusta University College of Dental Medicine Faculty Practice Group d/b/a AU Dental Faculty Practice Group

AU Health System Inc

AU Medical Associates

Bainbridge State College Foundation

$

50,742,878

$

1,615,076

$

453,808

1,276,274

9,547,201
478,227 --
$

$ -- 12,318,703

31,962,778 250,102 --
1,941,197 612,613,382

81,403 --
140,467,104

1,108,608 1,023,803
16,966 3,879,459

60,768,306

12,318,703

646,767,459

$ 142,163,583

-- 389,340 389,340

OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses

--
1,051,168 1,059,977
16,122 2,127,267

--
60,496,796 60,496,796

2,300,776
10,588,318 12,889,094

248,460,099 54,263,244 78,804,212 813,662
3,982,641 265,946,995
33,593,642 685,864,495

29,489,419 27,193,176 89,452,222
2,393,843 169,172 98,365
13,319,265 781,266
162,896,728

--
122,633 122,633

Operating Income (Loss)

1,752,192

271,510

(570,391)

(39,097,036)

(20,733,145)

266,707

NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses

1,912,775 (997,521) (271,369) 643,885 2,396,077

55,228
(99,563) (44,335) 227,175

939,954
939,954 369,563

31,409,501
2,967,388 3,178,581
741
4,114,965 2,307,576
359,819 44,338,571
5,241,535

2,106,759 (788,272) (25,075,751) (23,757,264) (44,490,409)

8,943
8,943 275,650

Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position

741,239
741,239 3,137,316

-- 227,175

88,747 1,955,837

-- 369,563

2,044,584 7,286,119

-- (44,490,409)

-- 275,650

Net Position, Beginning of Year Net Position-End of Year

32,677,340

$

35,814,656 $

8,236,438 8,463,613 $

1,813,252 2,182,815 $

278,400,744 285,686,863 $

78,565,002 34,074,593 $

1,987,699 2,263,349

186 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

Clayton State University
Foundation, Inc.

College of Coastal Georgia Foundation,
Inc.

Columbus State University Research
& Service Foundation

Columbus State University Alumni Association, Inc.

Columbus State University Athletic
Fund, Inc.

Columbus State University
Foundation, Inc.

$

1,043,765 $

--

241,818 $ --

$ 694
--

15,855 $ --

30,259 $ --

1,328,881 25,642 --

1,392,349 135,741
2,571,855
--
152,842 309,963 1,484,390 389,215 2,336,410 235,445

532,371 575,393 1,349,582
--
653,395 31,907 42,686
727,988 621,594

48

50,905

41,067

28,679,752

1,395,768

3,869

69,978

742

70,629

71,326

31,500,021

--

--

--

1,403,781

150,356

387,333 321,514

500

99,637

228,898

19,248,765

500

99,637

228,898

21,511,749

242

(29,008)

(157,572)

9,988,272

3,463,289 (3,509,558)
(46,269) 189,176

366,653
(858,316) (491,663) 129,931

2,933

(240,394)

31,626

--

2,933

(240,394)

31,626

242

(26,075)

(397,966)

10,019,898

205,577

32,507

205,577 394,753

32,507 162,438

8,651,238

15,707,903

$

9,045,991 $

15,870,341 $

-- 242
2,580 2,822 $

6,150

897,552

-- (26,075)
404,815 378,740 $

6,150 (391,816)
2,521,782 2,129,966 $

897,552 10,917,450
77,468,360 88,385,810

2017 Annual Financial Report 187

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

Dalton State College Athletic Club

Dalton State College Foundation, Inc.

Darton Boosters, Inc.

Darton State College Foundation, Inc.

East Georgia State College Foundation,
Inc.

Fort Valley State University
Foundation, Inc.

--

--

--

--

$

58,010

--

1,790,746 $

27,864

$

3,418,528

--

--

--

--

--

--

--

--

--

$

540,951 $

416,558

256,438 $

766,421

1,086,728

--

231,765

50,754

--

5,642

772,716

467,312

1,848,756

284,302

772,063

4,505,256

--

164,313

--

664,829 1,164,716 1,829,545 (1,056,829)

1,491,158 1,691
1,657,162
(1,189,850)

1,683,076 1,683,076
165,680

-- -- -- -- 226,024 -- 304,462 -- 530,486
(246,184)

--

--

300,056
229,323 6,770
536,149
235,914

2,111,433 47,728
2,159,161
2,346,095

49
49 (1,056,780)

1,266,583 (21,303)
1,245,280 55,430

4,353
4,353 170,033

--
-- -- -- -- 129,258 -- (174,070) (44,812) (290,996)

107,357
107,357 343,271

923 (2,685,167)
(2,684,244) (338,149)

144,553

-- (1,056,780)

144,553 199,983

4,079,276

34,652,166

$

3,022,496 $

34,852,149 $

-- 170,033
2,617,929 2,787,962 $

-- -- -- -- -- -- -- (290,996)
4,731,464 4,440,468 $

300

39,438

300 343,571
2,027,775 2,371,346 $

39,438 (298,711)
10,516,037 10,217,326

188 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

Foundation Properties, Inc. (Columbus State
University)

Georgia Advanced Technology
Ventures, Inc.

Georgia Center for Medical Innovation

Georgia College & State University
Alumni Association, Inc.

Georgia College & State University Foundation

Georgia Gwinnett College Foundation,
Inc.

$

29,595

166,999 $

1,291,532

$

5,574,554

12,750,573

--

--

$ --

$ 6,455,162

79,006 11,575,854

84,604 4,967
5,664,125
246,000 30,928

427,596 3,253
13,378,016
57,190

35,012 1,035,249 2,270,497 3,617,686
2,046,439

39,500 6,011,245 2,604,228 8,712,163
4,665,853

76,237 $ 1,367,769

131,019 919,528
94,518 1,145,065

559,098 152,476 481,754
28,053

124,752 2,278

402,891 245,509 1,869,781
(502,012)

385,521 401
512,952
632,113

1,812,948 3,244,705
123,712 11,636,527
687,008
71,072 744,748
87,198 2,638,718
105,872 4,334,616
7,301,911

1,324,289 378,000
13,357,149
--
251,913 1,544,717
82,597 1,879,227 11,477,922

90,079 (1,590,640)
(1,500,561) 545,878

19,821 (3,410,537)
(3,390,716) 1,275,137

300 (2,104)
(1,804) (503,816)

--
-- 632,113

6,148,739 (4,192,793)
1,955,946 9,257,857

1,498,018 (7,515,725)
(6,017,707) 5,460,215

1,000,000 2,000,000

86,864

1,904,607

(48,975)

-- 545,878

3,000,000 4,275,137

23,098,082

24,327,906

$

23,643,960 $

28,603,043 $

-- (503,816)
1,670,658 1,166,842 $

86,864 718,977
7,572,196 8,291,173 $

1,904,607 11,162,464
17,356,061 28,518,525 $

(48,975) 5,411,240
1,329,268 6,740,508

2017 Annual Financial Report 189

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

Georgia Health Sciences
Foundation, Inc.

Georgia Highlands College Foundation,
Inc.

Georgia Southern University Athletic Foundation, Inc.

Georgia Southern University
Foundation, Inc.

Georgia Southern Housing Foundation,
Inc.

Georgia Southern University Research
& Service Foundation, Inc.

$

405,857

922,460 $

49,036

12,300

1,057,007 $

1,375,988

--

--

$

$ --

10,543,159

5,120,931 682,902 901,811
7,877,356
--

1,356,302 1,595,639 4,292,558
-- 987,036 134,746 1,096,559 6,037,878 8,256,219 (3,963,661)

391,603 59,179
1,556,825
--
116,624 289,781
4,522 410,927 1,145,898

3,506,311 $ 56,749 16,956
4,956,004

8,643,633 5,081,842
569,338 14,294,813

672,995 24,600
37,244 15,350
237 2,298,593
316,473 3,365,492
1,590,512

2,982,633
431,407 9,277
3,772,123 17,714
7,213,154
7,081,659

1,740,776 12,283,935
-- 201,703
1,384,424 1,586,127 10,697,808

2,235 14,585,235
-- 112,528
1,491
14,616,778 176
14,730,973 (145,738)

342,379 (26,021)
316,358 (3,647,303)

174,498 (852,796)
(678,298) 467,600

75,156 (869,321)
(794,165) 796,347

1,122,134 (6,784)
(134,501) 980,849 8,062,508

752,945 (8,877,741)
(8,124,796) 2,573,012

3,905 (1,619)
2,286 (143,452)

355,219

4,910

445,966

(218)

355,219 (3,292,084)

25,110,469

$

21,818,385 $

4,910 472,510
3,457,114 3,929,624 $

445,966 1,242,313
12,069,081 13,311,394 $

(218) 8,062,290
57,361,404 65,423,694 $

-- 2,573,012
22,703,389 25,276,401 $

-- (143,452)
3,260,832 3,117,380

190 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

Georgia Southwestern State
University Foundation, Inc.

Georgia State University Alumni Association, Inc.

Georgia State University
Foundation, Inc.

Georgia State University Research Foundation Inc. and
Affiliates

Georgia Tech Alumni Association

Georgia Tech Athletic Association

--

--

$

5,432,221

--

--

--

--$

$

2,474,475

--

--

--

--

2,728,353

--

410,768

5,613,596

-- -- -- 505,421 --$ -- -- -- -- 26,543 -- 166,089 698,053

$
20,163,192
27,097,797 5,747,888 (7,446,971)
45,561,906

74,446,010 1,069,375
17,863,149 129,335 --
2,835,187 96,343,056

1,574,400 $ 180,646 --

56,864,958 9,591,533 --

25,925 7,213,192

4,122,330 70,578,821

-- -- -- -- 858,601 -- 3,702,879 -- 4,561,480
1,052,116

-- -- -- -- 46,694 -- 721,803 -- 768,497
(70,444)

--
1,204,375 7,237,984
36,232,588 591,008
45,265,955
295,951

--
97,054
6,328 92,696,632
653,811 93,453,825
2,889,231

3,725,113 892,248
342,373 85,238
1,907,367 72,737
7,025,076
188,116

--
6,319,413 11,071,266
47,327,899 7,587,218
72,305,796
(1,726,975)

--
-- -- -- -- 449,865 -- 3,003,445 3,453,310 4,505,426

--
-- -- -- -- -- -- 65,185 65,185 (5,259)

8,358,721 (1,696,322)
6,662,399 6,958,350

(80,935) 605,029 (2,819,904) 633,791 (1,662,019) 1,227,212

-- 188,116

12,428,554 (12,592,465)
(1,149,375) (1,313,286) (3,040,261)

-- -- -- -- -- -- -- 4,505,426

30,676,162

$

35,181,588 $

-- -- -- -- -- -- -- (5,259)
1,736,514 1,731,255 $

12,542,959
12,542,959 19,501,309 236,365,288 255,866,597 $

-- 1,227,212
23,740,168 24,967,380 $

1,969,742

-- 188,116
66,714 254,830 $

1,969,742 (1,070,519)
62,409,408 61,338,889

2017 Annual Financial Report 191

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

Georgia Tech Facilities, Inc.

Georgia Tech Foundation, Inc.

Georgia Tech Research Corporation

Georgia Tech Global

Gordon State College Foundation, Inc. & Subsidiaries

James M. Dye Foundation, Inc.

--

$

583,812,699

7,573,630

$

1,980,000

90,628,106

8,784 $

21,000

$

14,661,626

25,570,000

11,888,231

--

16,650,410

47,181,000 72,772,000

693,902,666

252,839 $
--
902,854
1,155,693

-- -- -- -- 2,872,571 -- -- -- -- 256,469 $ -- 39,522 3,168,562

-- 83,552 83,552

--
193,750 749,134
60,000 1,002,884 15,647,526

3,403,000 529,000 72,000 92,000
512,000 104,195,000
4,352,000 113,155,000
(40,383,000)

--
127,858
690,277,098 340,865
690,745,821 3,156,845

430,148
4,060
8,237 711,140
8,745 1,162,330
(6,637)

-- -- -- -- 318,138 -- 149,848 -- 467,986
2,700,576

--
69,476 20,811 90,287 (6,735)

123,965 (12,905,063)
(12,781,098) 2,866,428

185,908,000 (12,380,000)
173,528,000 133,145,000

422,189
370,702 792,891 3,949,736

653 653 (5,984)

--
-- -- -- -- 484,326 (1,941,393) -- (1,457,067) 1,243,509

36,241
105,902 142,143 135,408

39,717,000

-- 2,866,428

39,717,000 172,862,000

-- 3,949,736

18,309,778

1,367,931,000

52,170,437

$

21,176,206 $

1,540,793,000 $

56,120,173 $

-- (5,984)
99,510 93,526 $

-- -- -- -- -- -- -- 1,243,509
12,762,467 14,005,976 $

-- 135,408
2,220,524 2,355,932

192 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

Kennesaw State University Athletic Association, Inc.

Kennesaw State University
Foundation, Inc.

Kennesaw State University Research
& Service Foundation, Inc.

Medical College of Georgia Foundation

Middle Georgia State University
Foundation, Inc. & Subsidiaries

Middle Georgia State University Real
Estate Foundation, Inc.

$

4,777,507

$

5,686,095 $

532,957

41,124,292

1,859,457 1,490,157
65,111 $ --

1,458,843

$ --

5,163,607

4,707,755 14,955,975 25,349,825
7,270,002
2,394,864 5,451,689 8,381,848
436,626 23,935,029
1,414,796

3,312,047 1,204,044 9,948,612 56,121,952
3,607,058
36,014 25,375
3,041,028 17,241,864
5,114,391 29,065,730
27,056,222

662,185
47,123 8,901,540
332,213 --
859,370 239,137
1,000 289
7,286,192
8,718,201
183,339

2,406,967 $
27,069 3,892,879

875,573
168,935 1,044,508

848,864 127,613
4,367 1,845,941
26,524 6,847,271
19,502 9,720,082
(5,827,203)

--
318,560 1,147,034 1,465,594 (421,086)

5,163,607 --
220,980 220,980 4,942,627

(32,529)
(32,529) 1,382,267

2,649,294 (15,273,484)
(12,624,190) 14,432,032

22,307
22,307 205,646

27,183,044
27,183,044 21,355,841

746,069
746,069 324,983

266,400 (4,584,391)
2,250 (4,315,741)
626,886

-- 1,382,267

940,155 (3,324,141) (2,383,986) 12,048,046

2,317,237

48,568,649

$

3,699,504 $

60,616,695 $

1,988,107

624,016

-- 205,646
-- 205,646 $

1,988,107 23,343,948
219,042,056 242,386,004 $

624,016 948,999
10,733,552 11,682,551 $

-- 626,886
13,840,748 14,467,634

2017 Annual Financial Report 193

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

Savannah State University
Foundation, Inc. & Subsidiaries

South Georgia State College Foundation, Inc. & Subsidiaries

Southern Polytechnic Applied
Research Corporation

University of Georgia Athletic Association,
Inc.

University of Georgia Foundation

University of Georgia Research
Foundation, Inc.

$

5,051,721 $

--

38,845 5,090,566
-- 180,108

858,567 1,038,675 4,051,891

$
173,174 --
348,614 521,788
--
84,793
84,793 436,995

(26,391) 108,301 (12,632)
--

$ --

$ 8,489,747 1,087,217

182,409,293
27,574,536 --

$

130,318,885

55,337,232

69,278

130,318,885

64,914,196

209,983,829

21,643 2,383 2,618 532
116,479
143,655
(74,377)

11,911,586 360,884
10,608,328
91,703,657 8,991,206
123,575,661
6,743,224

441,568
902,749 63,000
77,618,273 1,320,150
80,345,740
(15,431,544)

--
194,300,429 115,077
194,415,506 15,568,323

17,489 (7,852,109)
(7,834,620) (3,782,729)

74,035 (1,640,063) 2,004,019
437,991 874,986

-- (74,377)

22,000,000 3,844,105 (2,396,646) (58,320)
23,389,139 30,132,363

106,844,666 1,766,237
108,610,903 93,179,359

3,231,309 (12,388,604)
(197,514) (9,354,809) 6,213,514

4,172,972

4,172,972 390,243

-- 874,986

1,261,607

5,818,316

$

1,651,850 $

6,693,302 $

53,483,214

-- (74,377)
-- (74,377) $

-- 30,132,363

53,483,214 146,662,573

207,871,626 238,003,989 $

976,193,206 1,122,855,779 $

-- 6,213,514
87,141,118 93,354,632

194 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

University of North Georgia Foundation
- Dahlonega, Inc.

University of North Georgia Real Estate
Foundation, Inc.

University of West Georgia Athletic Foundation, Inc.

University of West Georgia Foundation,
Inc.

UWG Real Estate Foundation, Inc.

University System of Georgia Foundation,
Inc. and Affiliates

--

--

--

--

$

38,400 $

281,338 $

100,000

$

586,393

$

76,670

8,009,644

3,325,259 $

6,455,564

15,160,170

--

--

--

--

--

--

--

3,228,279

151,602

1,030,248

4,772,853

1,397,572

2,210,503

--

770,614

21,479

--

149,081

239,645

--

5,515,452

8,199,646

1,460,667

9,208,371

6,455,564

17,165,614

--
2,662,259 4,262,874
27,013 6,952,146 (1,436,694)

-- -- -- -- -- -- 700,321 116,941 817,262
7,382,384

201,974
7,454 205,657
19,400 18,618 822,175
1,275,278
185,389

--
126,300 1,263,897 4,602,666 5,992,863 3,215,508

--
717,800 717,800 5,737,764

--
59,325 1,578,671 1,855,931 3,493,927 13,671,687

5,314,332
5,314,332 3,877,638

--
-- -- -- -- 304,035 (6,373,418) -- (6,069,383) 1,313,001

(389,768) 52,194
(337,574) (152,185)

2,523,019 (2,405,138)
117,881 3,333,389

117,849 (5,144,156)
(5,026,307) 711,457

566,478 (12,553,448)
(11,986,970) 1,684,717

960,538

960,538 4,838,176

55,702,839

$

60,541,015 $

-- -- -- -- (1,217,245) -- (1,217,245) 95,756
8,645,306 8,741,062 $

329,753

-- (152,185)
1,684,859 1,532,674 $

329,753 3,663,142
41,089,233 44,752,375 $

-- 711,457
2,810,692 3,522,149 $

104,678
104,678 1,789,395 (334,207) 1,455,188

2017 Annual Financial Report 195

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION BY AFFILIATED ORGANIZATION (Unaudited) FOR FISCAL YEAR ENDED JUNE 30, 2017

OPERATING REVENUES Student Tuition and Fees (net) Grants and Contracts Federal State Other Sales and Services Rents and Royalties Auxiliary Enterprises Food Services Health Services Intercollegiate Athletics Gifts and Contributions Endowment Income Other Operating Revenues
Total Operating Revenues
OPERATING EXPENSES Salaries Employee Benefits Other Personal Services Travel Scholarships and Fellowships Utilities Supplies and Other Services Depreciation
Total Operating Expenses
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES) State Appropriations Grants and Contracts Federal State Other Gifts Investment Income Interest Expense Other Nonoperating Revenues (Expenses)
Net Nonoperating Revenues Income (Loss) Before Other Revenues, Expenses, Gains, or Losses
Capital Grants and Gifts Federal State Other
Additions to Permanent and Term Endowments Special Item Extraordinary Item Total Other Revenues, Expenses, Gains or Losses Change in Net Position
Net Position, Beginning of Year Net Position-End of Year

VSU Auxiliary Services Real Estate
Foundation

Valdosta State University
Foundation, Inc.

Walter & Emilie Spivey Foundation

Total

$

$

7,631,810

404,630 518,866
--

3,860,094
954,491 12,446,395

1,338,217 878,323 123,911
3,263,947

$ --
--

-- -- -- -- -- 404,630 8,150,676 -- -- -- -- 5,198,311 878,323 1,078,402 15,710,342

93,932
621,492 715,424 11,730,971

--
30,200 179,182 977,722
2,482,224 $ 216,891
3,886,219
(622,272)

--
366,392 366,392 (366,392)

93,932 --
30,200 179,182 977,722
-- 3,470,108
216,891 4,968,035
10,742,307

38,170 (7,575,758) (8,318,529) (15,856,117) (4,125,146)

1,097,537 (139,986)
957,551 335,279

539,479
539,479 173,087

-- -- -- -- -- -- 1,675,186 (7,715,744) (8,318,529) (14,359,087) (3,616,780)

1,290,372

-- (4,125,146)

1,290,372 1,625,651

10,623,809

41,646,716

$

6,498,663 $

43,272,367 $

-- 173,087
6,351,394 6,524,481 $

-- -- -- 1,290,372 -- -- 1,290,372 (2,326,408)
58,621,919 56,295,511

196 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA BALANCE SHEET (NON-GAAP BASIS) BUDGET FUNDS JUNE 30, 2017 (Unaudited)

ASSETS Cash and Cash Equivalents Investments Accounts Receivable
Federal Financial Assistance Other Prepaid Expenditures Inventories Other Assets

$

757,641,746.92

98,138,206.00

130,115,836.10 274,833,086.70
16,516,452.68 5,416,754.79 2,040,560.28

Total Assets

$

1,284,702,643.47

LIABILITIES AND FUND EQUITY Liabilities
Accounts Payable Encumbrances Payable Salaries Payable Payroll Withholdings Deferred Revenue Other Liabilities

$

107,939,117.40

386,329,661.85

20,606,602.50

32,401.34

252,178,240.49

3,042,195.61

Total Liabilities

770,128,219.19

Fund Balances Reserved Capital Outlay Department Sales and Services Indirect Cost Recoveries Technology Fees Restricted/Sponsored Funds Uncollectible Accounts Receivable Inventories Tuition Carry - Forward Carry-Over "Per Governor's Office of Planning and Budget" Unreserved Surplus

14,813,622.02 121,903,398.81 145,276,798.74
20,145,786.81 135,441,286.10
23,742,316.02 3,351,370.34
43,519,848.54 3,700,782.22
2,679,214.68

Total Fund Balances

514,574,424.28

Total Liabilities and Fund Balances

$

1,284,702,643.47

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

2017 Annual Financial Report 197

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia Agricultural Experiment Station
State Appropriation State General Funds
Other Funds

Original Appropriation

Amended Appropriation

Final Budget

Funds Available Compared to Budget

Current Year Revenues

Prior Year Reserve Carry-Over

$ 38,763,187.00 $ 39,549,773.00 $ 39,549,773.00 $ 39,549,773.00 $

--

37,552,919.00

37,552,919.00

61,734,075.00

54,749,079.72

19,624,833.82

Total Agricultural Experiment Station

76,316,106.00

77,102,692.00

101,283,848.00

94,298,852.72

19,624,833.82

Athens and Tifton Vet Laboratories Other Funds

5,785,273.00

6,511,331.00

7,194,639.00

6,647,637.32

704,433.43

Cooperative Extension Service State Appropriation State General Funds Other Funds

34,830,899.00 31,333,929.00

35,533,763.00 31,333,929.00

35,533,763.00 41,407,508.00

35,533,763.00 35,738,803.72

-- 5,778,606.64

Total Cooperative Extension Service

66,164,828.00

66,867,692.00

76,941,271.00

71,272,566.72

5,778,606.64

Enterprise Innovation Institute State Appropriation State General Funds Other Funds

19,342,678.00 10,900,000.00

19,342,678.00 10,900,000.00

19,342,678.00 11,950,000.00

19,342,678.00 11,005,168.21

-- 59,264.31

Total Enterprise Innovation Institute

30,242,678.00

30,242,678.00

31,292,678.00

30,347,846.21

59,264.31

Forestry Cooperative Extension State Appropriation State General Funds Other Funds

853,902.00 575,988.00

873,637.00 575,988.00

873,637.00 695,899.00

873,637.00 592,113.83

-- 228,387.57

Total Forestry Cooperative Extension

1,429,890.00

1,449,625.00

1,569,536.00

1,465,750.83

228,387.57

Forestry Research State Appropriation State General Funds Other Funds

2,725,563.00 10,250,426.00

2,872,377.00 10,325,426.00

2,872,377.00 11,827,069.00

2,872,377.00 10,018,181.64

-- 2,967,036.16

Total Forestry Research

12,975,989.00

13,197,803.00

14,699,446.00

12,890,558.64

2,967,036.16

Georgia Archives State Appropriation State General Funds Other Funds

4,678,137.00 882,473.00

6,178,137.00 894,417.00

6,178,137.00 1,075,958.00

6,178,137.00 962,048.30

-- 1,162,556.19

Total Georgia Archives

5,560,610.00

7,072,554.00

7,254,095.00

7,140,185.30

1,162,556.19

Georgia Radiation Therapy Center Other Funds

$ 4,466,022.00 $ 4,236,754.00 $ 4,236,754.00 $

--$

--

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

198 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia Agricultural Experiment Station
State Appropriation State General Funds
Other Funds

Funds Available Compared to Budget

Program Transfers or Adjustments

Total Funds Available

Variance Positive (Negative)

Expenditures Compared to Budget

Current Year Actual

Variance Positive (Negative)

Excess (Deficiency) of Funds Available
Over/(Under) Expenditures

$

-- $ 39,549,773.00 $

-- $ 39,549,773.00 $

--$

--

--

74,373,913.54

12,639,838.54

51,681,427.30

10,052,647.70

22,692,486.24

Total Agricultural Experiment Station

--

113,923,686.54

12,639,838.54

91,231,200.30

10,052,647.70

22,692,486.24

Athens and Tifton Veterinary Laboratories Other Funds

--

7,352,070.75

157,431.75

6,562,216.82

632,422.18

789,853.93

Cooperative Extension Service State Appropriation State General Funds Other Funds

--

35,533,763.00

--

41,517,410.36

-- 109,902.36

35,533,763.00 35,400,016.00

-- 6,007,492.00

-- 6,117,394.36

Total Cooperative Extension Service

--

77,051,173.36

109,902.36

70,933,779.00

6,007,492.00

6,117,394.36

Enterprise Innovation Institute State Appropriation State General Funds Other Funds

--

19,342,678.00

--

11,064,432.52

-- (885,567.48)

19,342,678.00 10,990,206.16

-- 959,793.84

-- 74,226.36

Total Enterprise Innovation Institute

--

30,407,110.52

(885,567.48)

30,332,884.16

959,793.84

74,226.36

Forestry Cooperative Extension State Appropriation State General Funds Other Funds

--

873,637.00

--

873,637.00

--

--

--

820,501.40

124,602.40

585,065.81

110,833.19

235,435.59

Total Forestry Cooperative Extension

--

1,694,138.40

124,602.40

1,458,702.81

110,833.19

235,435.59

Forestry Research State Appropriation State General Funds Other Funds

--

2,872,377.00

--

12,985,217.80

-- 1,158,148.80

2,872,377.00 10,551,547.71

-- 1,275,521.29

-- 2,433,670.09

Total Forestry Research

--

15,857,594.80

1,158,148.80

13,423,924.71

1,275,521.29

2,433,670.09

Georgia Archives State Appropriation State General Funds Other Funds

-- (300.00)

6,178,137.00 2,124,304.49

-- 1,048,346.49

6,178,125.85 938,312.60

11.15 137,645.40

11.15 1,185,991.89

Total Georgia Archives

(300.00)

8,302,441.49

1,048,346.49

7,116,438.45

137,656.55

1,186,003.04

Georgia Radiation Therapy Center

Other Funds

$

--$

-- $ (4,236,754.00) $

-- $ 4,236,754.00 $

--

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

2017 Annual Financial Report 199

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia Georgia Research Alliance
State General Funds

Original Appropriation

Amended Appropriation

Final Budget

Funds Available Compared to Budget

Current Year Revenues

Prior Year Reserve Carry-Over

$ 5,097,451.00 $ 5,097,451.00 $ 5,097,451.00 $ 5,097,451.00 $

--

Georgia Tech Research Institute State Appropriation State General Funds Other Funds

5,810,979.00 361,751,431.00

5,810,979.00 406,225,535.00

5,810,979.00 401,540,070.00

5,810,979.00 375,257,867.57

-- 2,246,485.06

Total Georgia Tech Research Institute

367,562,410.00

412,036,514.00

407,351,049.00

381,068,846.57

2,246,485.06

Marine Institute State Appropriation State General Funds Other Funds

942,055.00 486,281.00

966,557.00 486,281.00

966,557.00 836,366.00

966,557.00 803,167.82

-- 474,717.41

Total Marine Institute

1,428,336.00

1,452,838.00

1,802,923.00

1,769,724.82

474,717.41

Marine Resources Extension Center State Appropriation State General Funds Other Funds

1,267,822.00 1,345,529.00

1,325,037.00 1,345,529.00

1,325,037.00 1,630,529.00

1,325,037.00 1,336,464.20

-- 176,361.03

Total Marine Resources Extension Center

2,613,351.00

2,670,566.00

2,955,566.00

2,661,501.20

176,361.03

Medical College of Georgia Hospital and Clinics State Appropriation State General Funds

29,838,518.00

29,838,518.00

29,838,518.00

29,838,518.00

--

Public Libraries State Appropriation State General Funds Other Funds

36,208,155.00

36,208,155.00

36,208,155.00

36,208,155.00

--

5,222,400.00

4,638,252.00

5,475,571.00

5,134,096.12

--

Total Public Libraries

41,430,555.00

40,846,407.00

41,683,726.00

41,342,251.12

--

Public Service / Special Funding Initiatives State Appropriation State General Funds State Funds - Prior Year Carry-Over State General Funds - Prior Year Other Funds

23,059,638.00
-- --

26,424,495.00
-- --

26,424,495.00
7,322,608.00 --

26,424,495.00
-- --

--
7,322,608.45 --

Total Public Service / Special Funding Initiatives

23,059,638.00

26,424,495.00

33,747,103.00

26,424,495.00

7,322,608.45

Regents Central Office State Appropriation State General Funds Other Funds

12,063,606.00 --

12,063,606.00 --

12,063,606.00 330,191.00

12,063,606.00 282,631.52

-- 4,295,638.65

Total Regents Central Office

$ 12,063,606.00 $ 12,063,606.00 $ 12,393,797.00 $ 12,346,237.52 $ 4,295,638.65

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

200 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia Georgia Research Alliance
State General Funds

Funds Available Compared to Budget

Program Transfers or Adjustments

Total Funds Available

Variance Positive (Negative)

Expenditures Compared to Budget

Current Year Actual

Variance Positive (Negative)

Excess (Deficiency) of Funds Available
Over/(Under) Expenditures

$

-- $ 5,097,451.00 $

-- $ 5,097,451.00 $

--$

--

Georgia Tech Research Institute State Appropriation State General Funds Other Funds

--

5,810,979.00

--

377,504,352.63

-- (24,035,717.37)

5,810,979.00 374,606,501.75

-- 26,933,568.25

-- 2,897,850.88

Total Georgia Tech Research Institute

--

383,315,331.63

(24,035,717.37)

380,417,480.75

26,933,568.25

2,897,850.88

Marine Institute State Appropriation State General Funds Other Funds

--

966,557.00

--

1,277,885.23

-- 441,519.23

966,557.00 768,309.86

-- 68,056.14

-- 509,575.37

Total Marine Institute

--

2,244,442.23

441,519.23

1,734,866.86

68,056.14

509,575.37

Marine Resources Extension Center State Appropriation State General Funds Other Funds

--

1,325,037.00

--

1,512,825.23

-- (117,703.77)

1,325,037.00 1,322,264.39

-- 308,264.61

-- 190,560.84

Total Marine Resources Extension Center

--

2,837,862.23

(117,703.77)

2,647,301.39

308,264.61

190,560.84

Medical College of Georgia Hospital and Clinics

State Appropriation

State General Funds

--

29,838,518.00

--

29,838,518.00

--

--

Public Libraries State Appropriation State General Funds Other Funds

--

36,208,155.00

--

5,134,096.12

-- (341,474.88)

36,206,581.01 5,134,096.12

1,573.99 341,474.88

1,573.99 --

Total Public Libraries

--

41,342,251.12

(341,474.88)

41,340,677.13

343,048.87

1,573.99

Public Service / Special Funding Initiatives State Appropriation State General Funds State Funds - Prior Year Carry-Over State General Funds - Prior Year Other Funds

--

26,424,495.00

7,322,608.45

--

25,424,439.26

0.45

4,621,826.23

1,000,055.74 2,700,781.77

1,000,055.74 2,700,782.22

Total Public Service / Special Funding Initiatives

--

33,747,103.45

0.45

30,046,265.49

3,700,837.51

3,700,837.96

Regents Central Office State Appropriation State General Funds Other Funds

--

12,063,606.00

4,578,270.17

-- 4,248,079.17

12,063,606.00 328,561.65

-- 1,629.35

-- 4,249,708.52

Total Regents Central Office

$

-- $ 16,641,876.17 $ 4,248,079.17 $ 12,392,167.65 $

1,629.35 $ 4,249,708.52

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

2017 Annual Financial Report 201

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia

Original Appropriation

Amended Appropriation

Final Budget

Funds Available Compared to Budget

Current Year Revenues

Prior Year Reserve Carry-Over

Skidaway Institute of Oceanography State Appropriation State General Funds Other Funds

$ 1,297,577.00 $ 1,334,196.00 $ 1,334,196.00 $ 1,334,196.00 $

3,800,620.00

3,800,620.00

5,758,975.00

5,261,773.51

-- 744,876.02

Total Skidaway Institute of Oceanography

5,098,197.00

5,134,816.00

7,093,171.00

6,595,969.51

744,876.02

Teaching State Appropriation State General Funds Other Funds

1,905,455,350.00 4,598,893,472.00

1,903,568,206.00 4,689,257,707.00

1,903,568,206.00 5,389,087,596.00

1,903,568,206.00 4,767,161,945.43

-- 381,684,840.23

Total Teaching

6,504,348,822.00

6,592,825,913.00

7,292,655,802.00

6,670,730,151.43

381,684,840.23

Veterinary Medicine Experiment Station State Appropriation State General Funds

2,707,032.00

3,081,059.00

3,081,059.00

3,081,059.00

--

Veterinary Medicine Teaching Hospital State Appropriation State General Funds Other Funds

427,418.00 14,500,000.00

445,000.00 17,000,000.00

445,000.00 19,482,262.00

445,000.00 17,225,368.17

-- 1,670,852.87

Total Veterinary Medicine Teaching Hospital

14,927,418.00

17,445,000.00

19,927,262.00

17,670,368.17

1,670,852.87

Agencies Attached for Administrative Purposes

Payments to Georgia Military College State Appropriation State General Funds

5,178,401.00

7,298,849.00

7,298,849.00

7,298,849.00

--

Payments to Public Telecommunications Commission State Appropriation State General Funds

15,153,706.00

15,154,949.00

15,154,949.00

15,154,949.00

--

Total Operating Activity

$ 7,233,448,837.00 $ 7,378,052,110.00 $ 8,124,553,492.00 $ 7,445,143,769.08 $ 429,141,497.84

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

202 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia Skidaway Institute of Oceanography
State Appropriation State General Funds
Other Funds

Funds Available Compared to Budget

Program Transfers or Adjustments

Total Funds Available

Variance Positive (Negative)

Expenditures Compared to Budget

Current Year Actual

Variance Positive (Negative)

Excess (Deficiency) of Funds Available
Over/(Under) Expenditures

$

-- $ 1,334,196.00 $

-- $ 1,334,196.00 $

--$

--

--

6,006,649.53

247,674.53

5,209,188.18

549,786.82

797,461.35

Total Skidaway Institute of Oceanography

--

7,340,845.53

247,674.53

6,543,384.18

549,786.82

797,461.35

Teaching State Appropriation State General Funds Other Funds

-- 15,431,303.52

1,903,568,206.00 5,164,278,089.18

-- (224,809,506.82)

1,903,373,950.49 4,724,738,712.89

194,255.51 664,348,883.11

194,255.51 439,539,376.29

Total Teaching

15,431,303.52

7,067,846,295.18

(224,809,506.82) 6,628,112,663.38

664,543,138.62

439,733,631.80

Veterinary Medicine Experiment Station State Appropriation State General Funds

--

3,081,059.00

--

3,081,059.00

--

--

Veterinary Medicine Teaching Hospital State Appropriation State General Funds Other Funds

--

445,000.00

--

18,896,221.04

-- (586,040.96)

445,000.00 16,620,761.10

-- 2,861,500.90

-- 2,275,459.94

Total Veterinary Medicine Teaching Hospital

--

19,341,221.04

(586,040.96)

17,065,761.10

2,861,500.90

2,275,459.94

Agencies Attached for Administrative Purposes

Payments to Georgia Military College State Appropriation State General Funds

--

7,298,849.00

--

7,298,849.00

--

--

Payments to Public Telecommunications Commission
State Appropriation
State General Funds

--

15,154,949.00

--

15,154,949.00

--

--

Total Operating Activity

$ 15,431,003.52 $ 7,889,716,270.44 $ (234,837,221.56) $ 7,401,830,540.18 $ 722,722,951.82 $ 487,885,730.26

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

2017 Annual Financial Report 203

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017
Regents, University System of Georgia Agricultural Experiment Station
State Appropriation State General Funds
Other Funds

Beginning Fund Balance/(Deficit)
July 1

Fund Balance Carried Over from
Prior Year as Funds Available

Return of Fiscal Year 2016
Surplus

Prior Year Adjustments

Other Adjustments

$

45,681.44 $

--$

(45,681.44) $

32,382.13 $

--

19,624,833.82

(19,624,833.82)

--

29,836.77

--

Total Agricultural Experiment Station

19,670,515.26

(19,624,833.82)

(45,681.44)

62,218.90

--

Athens and Tifton Vet Laboratories Other Funds

704,433.43

(704,433.43)

--

4,360.33

--

Cooperative Extension Service State Appropriation State General Funds Other Funds

15,050.01

--

(15,050.01)

21,442.08

--

5,778,606.64

(5,778,606.64)

--

48,585.82

--

Total Cooperative Extension Service

5,793,656.65

(5,778,606.64)

(15,050.01)

70,027.90

--

Enterprise Innovation Institute State Appropriation State General Funds Other Funds

--

--

--

--

--

59,264.31

(59,264.31)

--

--

--

Total Enterprise Innovation Institute

59,264.31

(59,264.31)

--

--

--

Forestry Cooperative Extension State Appropriation State General Funds Other Funds

1,406.36

--

(1,406.36)

516.24

--

228,387.57

(228,387.57)

--

49.99

--

Total Forestry Cooperative Extension

229,793.93

(228,387.57)

(1,406.36)

566.23

--

Forestry Research State Appropriation State General Funds Other Funds

1,109.57

--

(1,109.57)

2,488.79

--

2,967,036.16

(2,967,036.16)

--

10,649.22

--

Total Forestry Research

2,968,145.73

(2,967,036.16)

(1,109.57)

13,138.01

--

Georgia Archives State Appropriation State General Funds Other Funds

89.80 1,162,556.19

-- (1,162,556.19)

(89.80) --

--

--

--

(23,384.40)

Total Georgia Archives

1,162,645.99

(1,162,556.19)

(89.80)

--

(23,384.40)

Georgia Radiation Therapy Center Other Funds

$

--$

--$

--$

--$

--

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

204 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia Agricultural Experiment Station
State Appropriation State General Funds
Other Funds

Early Return of Fiscal Year 2017
Surplus

Excess (Deficiency) of Funds Available
Over/Under) Expenditures

Ending Fund Balance/(Deficit)
June 30

Analysis of Ending Fund Balance

Reserved

Surplus/(Deficit)

Total

$

--$

--$

32,382.13 $

--$

32,382.13 $

32,382.13

--

22,692,486.24

22,722,323.01

22,722,323.01

--

22,722,323.01

Total Agricultural Experiment Station

--

22,692,486.24

22,754,705.14

22,722,323.01

32,382.13

22,754,705.14

Athens and Tifton Vet Laboratories Other Funds

--

789,853.93

794,214.26

794,214.26

--

794,214.26

Cooperative Extension Service State Appropriation State General Funds Other Funds

--

--

21,442.08

--

--

6,117,394.36

6,165,980.18

6,165,980.18

21,442.08 --

21,442.08 6,165,980.18

Total Cooperative Extension Service

--

6,117,394.36

6,187,422.26

6,165,980.18

21,442.08

6,187,422.26

Enterprise Innovation Institute State Appropriation State General Funds Other Funds

--

--

--

--

--

74,226.36

74,226.36

74,226.36

--

--

--

74,226.36

Total Enterprise Innovation Institute

--

74,226.36

74,226.36

74,226.36

--

74,226.36

Forestry Cooperative Extension State Appropriation State General Funds Other Funds

--

--

516.24

--

--

235,435.59

235,485.58

235,485.58

516.24 --

516.24 235,485.58

Total Forestry Cooperative Extension

--

235,435.59

236,001.82

235,485.58

516.24

236,001.82

Forestry Research State Appropriation State General Funds Other Funds

--

--

2,488.79

--

--

2,433,670.09

2,444,319.31

2,444,319.31

2,488.79 --

2,488.79 2,444,319.31

Total Forestry Research

--

2,433,670.09

2,446,808.10

2,444,319.31

2,488.79

2,446,808.10

Georgia Archives State Appropriation State General Funds Other Funds

--

11.15

11.15

--

--

1,185,991.89

1,162,607.49

1,161,082.52

11.15 1,524.97

11.15 1,162,607.49

Total Georgia Archives

--

1,186,003.04

1,162,618.64

1,161,082.52

1,536.12

1,162,618.64

Georgia Radiation Therapy Center

Other Funds

$

--$

--$

--$

--$

--$

--

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

2017 Annual Financial Report 205

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017
Regents, University System of Georgia Georgia Research Alliance
State General Funds

Beginning Fund Balance/(Deficit)
July 1

Fund Balance Carried Over from
Prior Year as Funds Available

Return of Fiscal Year 2016
Surplus

Prior Year Adjustments

Other Adjustments

$

--$

--$

--$

--$

--

Georgia Tech Research Institute State Appropriation State General Funds Other Funds

78.54

--

(78.54)

108.51

--

2,246,485.06

(2,246,485.06)

--

--

--

Total Georgia Tech Research Institute

2,246,563.60

(2,246,485.06)

(78.54)

108.51

--

Marine Institute State Appropriation State General Funds Other Funds

0.01

--

(0.01)

1,086.19

--

474,717.41

(474,717.41)

--

--

--

Total Marine Institute

474,717.42

(474,717.41)

(0.01)

1,086.19

--

Marine Resources Extension Center State Appropriation State General Funds Other Funds

717.02

--

(717.02)

554.45

--

176,361.03

(176,361.03)

--

716.56

--

Total Marine Resources Extension Center

177,078.05

(176,361.03)

(717.02)

1,271.01

--

Medical College of Georgia Hospital and Clinics State Appropriation State General Funds

--

--

--

--

--

Public Libraries State Appropriation State General Funds Other Funds

26,667.14

--

(26,667.14)

2,223.59

--

--

--

--

--

--

Total Public Libraries

26,667.14

--

(26,667.14)

2,223.59

--

Public Service / Special Funding Initiatives State Appropriation State General Funds State Funds - Prior Year Carry-over State General Funds - Prior Year Other Funds

429,700.37

--

(429,700.37)

--

--

7,322,608.45

(7,322,608.45)

--

68,987.96

--

24.23

--

(24.23)

--

--

Total Public Service / Special Funding Initiatives

7,752,333.05

(7,322,608.45)

(429,724.60)

68,987.96

--

Regents Central Office State Appropriation State General Funds Other Funds

24,376.33

--

(24,376.33)

34,609.23

--

4,295,638.65

(4,295,638.65)

--

--

--

Total Regents Central Office

$

4,320,014.98 $ (4,295,638.65) $

(24,376.33) $

34,609.23 $

--

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

206 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia Georgia Research Alliance
State General Funds

Early Return of Fiscal Year 2017
Surplus

Excess (Deficiency) of Funds Available
Over/Under) Expenditures

Ending Fund Balance/(Deficit)
June 30

Analysis of Ending Fund Balance

Reserved

Surplus/(Deficit)

Total

$

--$

--$

--$

--$

--$

--

Georgia Tech Research Institute State Appropriation State General Funds Other Funds

--

--

108.51

--

--

2,897,850.88

2,897,850.88

2,897,850.88

108.51 --

108.51 2,897,850.88

Total Georgia Tech Research Institute

--

2,897,850.88

2,897,959.39

2,897,850.88

108.51

2,897,959.39

Marine Institute State Appropriation State General Funds Other Funds

--

--

1,086.19

--

--

509,575.37

509,575.37

509,575.37

1,086.19 --

1,086.19 509,575.37

Total Marine Institute

--

509,575.37

510,661.56

509,575.37

1,086.19

510,661.56

Marine Resources Extension Center State Appropriation State General Funds Other Funds

--

--

554.45

--

--

190,560.84

191,277.40

191,277.40

554.45 --

554.45 191,277.40

Total Marine Resources Extension Center

--

190,560.84

191,831.85

191,277.40

554.45

191,831.85

Medical College of Georgia Hospital and Clinics

State Appropriation

State General Funds

--

--

--

--

--

--

Public Libraries State Appropriation State General Funds Other Funds

--

1,573.99

3,797.58

--

--

--

--

3,797.58

3,797.58

--

--

--

Total Public Libraries

--

1,573.99

3,797.58

--

3,797.58

3,797.58

Public Service / Special Funding Initiatives State Appropriation State General Funds State Funds - Prior-Year Carry-over State General Funds - Prior Year Other Funds

--

1,000,055.74

1,000,055.74

1,000,000.00

--

2,700,782.22

2,769,770.18

2,700,782.22

--

--

--

--

55.74
68,987.96 --

1,000,055.74
2,769,770.18 --

Total Public Service / Special Funding Initiatives

--

3,700,837.96

3,769,825.92

3,700,782.22

69,043.70

3,769,825.92

Regents Central Office State Appropriation State General Funds Other Funds

--

--

34,609.23

--

--

4,249,708.52

4,249,708.52

4,249,708.52

34,609.23 --

34,609.23 4,249,708.52

Total Regents Central Office

$

-- $ 4,249,708.52 $ 4,284,317.75 $ 4,249,708.52 $

34,609.23 $ 4,284,317.75

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

2017 Annual Financial Report 207

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017
Regents, University System of Georgia Skidaway Institute of Oceanography
State Appropriation State General Funds
Other Funds
Total Skidaway Institute of Oceanography
Teaching State Appropriation State General Funds Other Funds
Total Teaching
Veterinary Medicine Experiment Station State Appropriation State General Funds
Veterinary Medicine Teaching Hospital State Appropriation State General Funds Other Funds
Total Veterinary Medicine Teaching Hospital
Agencies Attached for Administrative Purposes
Payments to Georgia Military College State Appropriation State General Funds
Payments to Public Telecommunications Commission State Appropriation State General Funds
Total Operating Activity
Prior Year Reserves Not Available for Expenditure Inventories Uncollectible Accounts Receivable
Budget Unit Totals

Beginning Fund Balance/(Deficit)
July 1

Fund Balance Carried Over from
Prior Year as Funds Available

Return of Fiscal Year 2016
Surplus

Prior Year Adjustments

Other Adjustments

$

2,029.38 $

--$

(2,029.38) $

6,732.93 $

--

744,876.02

(744,876.02)

--

3,047.34

--

746,905.40

(744,876.02)

(2,029.38)

9,780.27

--

1,293,651.42 382,832,525.69
384,126,177.11

-- (381,684,840.23)
(381,684,840.23)

(1,293,651.42) (1,147,685.46)
(2,441,336.88)

948,517.58 (772,481.10)
176,036.48

74,091.39 (971,398.34)
(897,306.95)

1,047.30

--

(1,047.30)

893.15

--

--

--

--

--

--

1,670,852.87

(1,670,852.87)

--

70,391.25

--

1,670,852.87

(1,670,852.87)

--

70,391.25

--

--

--

--

--

--

-- 432,130,812.22

-- (429,141,497.84)

-- (2,989,314.38)

-- 515,699.01

-- (920,691.35)

3,015,211.26

--

--

23,157,783.75

--

--

$ 458,303,807.23 $ (429,141,497.84) $ (2,989,314.38) $

-- --
515,699.01 $

336,159.08 584,532.27
--

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

208 University System of Georgia

UNIVERSITY SYSTEM OF GEORGIA STATEMENT OF CHANGES TO FUND BALANCE BY PROGRAM AND FUNDING SOURCE (Unaudited) BUDGET FUND FOR THE FISCAL YEAR ENDED JUNE 30. 2017

Regents, University System of Georgia Skidaway Institute of Oceanography
State Appropriation State General Funds
Other Funds

Early Return of Fiscal Year 2017
Surplus

Excess (Deficiency) of Funds Available
Over/Under) Expenditures

Ending Fund Balance/(Deficit)
June 30

Analysis of Ending Fund Balance

Reserved

Surplus/(Deficit)

Total

$

--$

--$

6,732.93 $

--$

6,732.93 $

6,732.93

--

797,461.35

800,508.69

800,508.69

--

800,508.69

Total Skidaway Institute of Oceanography

--

797,461.35

807,241.62

800,508.69

6,732.93

807,241.62

Teaching State Appropriation State General Funds Other Funds

--

194,255.51

1,216,864.48

--

--

439,539,376.29

437,795,496.85

436,508,337.75

1,216,864.48 1,287,159.10

1,216,864.48 437,795,496.85

Total Teaching

--

439,733,631.80

439,012,361.33

436,508,337.75

2,504,023.58

439,012,361.33

Veterinary Medicine Experiment Station State Appropriation State General Funds

--

--

893.15

--

893.15

893.15

Veterinary Medicine Teaching Hospital State Appropriation State General Funds Other Funds

--

--

--

--

--

2,275,459.94

2,345,851.19

2,345,851.19

--

--

--

2,345,851.19

Total Veterinary Medicine Teaching Hospital

--

2,275,459.94

2,345,851.19

2,345,851.19

--

2,345,851.19

Agencies Attached for Administrative Purposes

Payments to Georgia Military College State Appropriation State General Funds

--

--

--

--

--

--

Payments to Public Telecommunications Commission
State Appropriation
State General Funds

--

--

--

--

--

--

Total Operating Activity

--

487,885,730.26

487,480,737.92

484,801,523.24

2,679,214.68

487,480,737.92

Prior Year Reserve Not Available for Expenditure Inventories Uncollectible Accounts Receivable

--

--

3,351,370.34

3,351,370.34

--

3,351,370.34

--

--

23,742,316.02

23,742,316.02

--

23,742,316.02

Budget Unit Totals

$

-- $ 487,885,730.26 $ 514,574,424.28 $ 511,895,209.60 $ 2,679,214.68 $ 514,574,424.28

Summary of Ending Fund Balance Reserved
Inventories Other Reserves
Colleges & Universities Unreserved, Undesignated
Surplus

$ 3,351,370.34

$ 3,351,370.34

508,543,839.26

508,543,839.26

$ $ 511,895,209.60 $

2,679,214.68 2,679,214.68

2,679,214.68 $ 514,574,424.28

Actual amounts were prepared on a prescribed basis of accounting that demonstrates compliance with budgetary statutes and regulations of the State of Georgia, which is a special purpose framework.

2017 Annual Financial Report 209

Acknowledgments
Published by University System of Georgia Strategy and Fiscal Affairs: Shelley C. Nickel - Executive Vice Chancellor, For Strategy and Fiscal Affairs/Treasurer Claire Arnold Brad Freeman Shree Hamm Theresa L. Jackson Ben M. Riden, Jr.
Special Appreciation to University System of Georgia Chief Business Officers: Paul Willis, Abraham Baldwin Agricultural College Shawn McGee, Albany State University James Shore, Armstrong State University Kwabena Boakye, Atlanta Metropolitan State College Anthony Wagner, Augusta University Justin Janney, Bainbridge State College Corlis Cummings, Clayton State University Jeffrey Preston, College of Coastal Georgia J. Thomas Helton, Columbus State University Nick Henry, Dalton State College Cliff Gay, East Georgia State College Mary Loomis, Fort Valley State University Susan Allen, Georgia College & State University Laura Maxwell, Georgia Gwinnett College Jeff Davis, Georgia Highlands College Steve Swant, Georgia Institute of Technology Robert Whitaker, Georgia Southern University Cody King, Georgia Southwestern State University Jerry Rackliffe, Georgia State University Kristen Albritton, Gordon State College Julie Peterson, Kennesaw State University Nancy Stroud, Middle Georgia State University Edward Jolley, Savannah State University Marcus J. Latham, South Georgia State College Ryan Nesbit, University of Georgia Mac McConnell, University of North Georgia Jim Sutherland, University of West Georgia Traycee Martin, Valdosta State University Diane Hickey, Board of Regents, University System Office
University System of Georgia Highlights: Courtesy of University System of Georgia Communications and Governmental Affairs
Photography: Courtesy of University System of Georgia Institutions
2017 Annual Financial Report 210

UNIVERSITY SYSTEM OF GEORGIA

270 Washington Street, SW Atlanta, GA 30334 404-962-3049
www.usg.edu