Meeting of the
BOARD OF GOVERNORS
May 8, 2003
Agenda Item No. 9
QUARTERLY FINANCIAL MANAGEMENT REPORT
Shepherd College issued $6 million in bonds during January. This transaction increased restricted cash and bonds payable. Cash and cash equivalents declined 19.43% from the third quarter of fiscal year 2002 because the Department of Administration reduced the quarterly appropriations for the first three quarters. Accounts payable decreased because the billings for construction projects declined, compared to fiscal year 2002. Construction activity and equipment purchases contributed to the increase in Capital Assets.
As of March 31, 2003, total operating revenues were 96.7% of the total fiscal year 2002 budgeted revenues. This is 2.9% more than the percent of budgeted revenues collected for the prior fiscal year. Tuition and fees, federal grant, private grant, sales and services of educational activities and auxiliary enterprise revenues increased. State appropriations decreased 11.3% because the Department of Administration decreased the allotments for the first three quarters of the year from the previous year. Investment income decreased 15%.
Operating expenditures were 76.8% of the total fiscal year 2003 budget as of March 31 versus 75 % for the prior year.
1. Shepherd College issued $6 million in bonds during January. This transaction increased restricted cash and bonds payable.
2. Operating cash: Operating cash decreased 20.06% compared to the third quarter of fiscal year 2002, because the Department of Administration decreased the quarterly allocation from the general fund during the first three quarters. The College will receive 33% of its appropriations in the fourth quarter compared to 18% received in the fourth quarter of fiscal year 2002.
3. Appropriations due from Primary Government: This line declined 78.67% because funds allocated for capital projects were expended.
4. Grants and contracts receivable: Some state agencies delayed payments until the fourth quarter of this fiscal year.
5. Restricted cash: Restricted cash increased because the College received proceeds from the bond issuance in January.
6. Capital assets: Capital assets increased as the Library addition was completed and other construction projects continued. Operating equipment was purchased.
7. The Other Noncurrent Assets increased because the College recorded bond issuance costs.
1. Accounts Payable: Accounts payable decreased 57.69% because the billings for construction projects declined from the same quarter for fiscal year 2002.
2. Accrued liabilities: Accrued liabilities increased 55.06% because more salaried employees are paid in arrears. The College must pay salaried employees hired after July 1, 2002 in arrears.
3. Deferred revenues: Deferred revenues increased 71.12% because the College has received HUD grants for the library renovations. The College did not receive HUD grant revenues until the fourth quarter of fiscal year 2002.
4. Bonds Payable: The College issued bonds in January.
1. Federal revenues: Library HUD grant revenues totaling $167,000 that were expended for furniture that did not exceed the $1,000 capitalization threshold were recorded as operating revenues. The Federal Grants budget was increased $167,000. Federal Pell Grants increased from last year.
2. State grants and contracts: State grants and contracts revenues increased because the funding from student aid programs increased.
3. Private grants and contracts: The Community and Technical College received $90,000 from its funds held by the Shepherd College Foundation.
1. Academic support: Several Community and Technical College grant expenditures were made earlier than in the prior year.
2. Operations and maintenance: Most of the planned renovations were completed during the first half of the year. Expenditures for furniture paid from the Library HUD grant revenues that did not exceed the $1,000 capitalization threshold were recorded as operating expenses. The Operations and Maintenance budget was increased $167,000. Utilities costs increased 21% because of the cold winter.
Nonoperating Revenues and Expenses
1. State appropriations: The Department of Administration decreased the allotment available for the second quarter of fiscal year 2003. The revenue will be received in the fourth quarter.
2. Investment income: Investment income declined because the College expended interest-earning funds to cover the shortfall in the quarterly allotment of appropriations. Interest rates were lower than they were during fiscal year 2002.