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Full text of "Financial report of the University of North Carolina at Wilmington"

1985-86 



The University of North Carolina at Wilmington 



rolirta at Wilmington is committed to equality of educational opportunity and does not discriminate 
or employees based on race, color, national origin, religion, sex, age, or handicap. Moreover, The 
Carolina at Wilmington is open to people of all races and actively seeks to promote racial integration by 
lling a larger number of black students. 




Financial Report 1985-86 

The University of North Carolina at Wilmington 



Contents 

Letter of Transmittal 2 

Enrollment 3 

Source of Current Funds 4 

Use of Current Funds 5 

Balance Sheet 6 

Opinion on Financial Statements 6 

Statement of Changes in Fund Balances 8 

Statement of Current Funds Revenues, 1 
Expenditures, and Other Changes 

Notes to Financial Statement 14 



A Letter of Transmittal 



To the Chancellor: 

Transmitted herewith are the university's financial statements for the 
fiscal year ending June 30, 1986. The expansion of the university's 
enrollment and programs are reflected in the dollar figures contained in 
these statements. University assets increased by $9,288,000 during the 
past fiscal year. Fund equity increased by $10,850,000. This increase in 
equity of $1,562,000 over our increase in assets reflects our ability to 
reduce liabilities during the past fiscal year. Our total equity on June 
30, 1986 was $61,502,000. The financial strength of the university has 
been enhanced during fiscal year 1985-86. 

The Business Affairs Division will continue to work with the other 
divisions of the university, UNC General Administration, university 
benefactors, federal agencies, and state government to ensure that 
financial and physical resources are available to support the university's 
primary functions of instruction, research, and public service. 

I would like to take this opportunity to thank you, the Board of 
Trustees, and my fellow vice chancellors for your support over the past 
fiscal year. 



Very truly yours, 




R.O. Walton, Jr. 

Vice Chancellor for Business Affairs 



Enrollment 



UNCW Enrollment 
1977-1986 



6000 -r 



5000 - - 



4000 - - 



3000 -- 



2000 - - 



1000 - - 




1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 



i Full Time Equivalent □ Headcount 



Sources of Current Funds 

Year 1985-1986 



State Appropriations 53.58% 



Sales and Services 17.25% 



Gifts, Grants, Contracts 7.38% 



Tuition and Fees 17.63% 




Total Current Funds Revenue $37,047,100 



Uses of Current Funds 

Year 1985-1986 



Instruction & Research 51.50% 



Auxiliary Enterprises 20.16% 



Financial Aid 5.30% 




Physical Plant 8.78% 

Institutional Support 
10.52% 



Student Services 3.74% 



Total Current Funds Expenditures $35,106,640 



Balance Sheet 

June 30, 1986 



Opinion on Financial Statements 

The enclosed balance sheet, statement of 
changes in fund balances and statement 
of current funds revenues, expenditures, 
and other changes along with the 
appertaining notes for The University of 
North Carolina at Wilmington have been 
reviewed by me and fairly represent the 
financial position of the University on 
June 30, 1986 and the results of 
operations for the fiscal year then ended. 

The statements are presented in general 
conformity with the guidelines outlined in 
the Industry Audit Guide, published by 
the American Institute of Certified Public 
Accountants, Second Edition. 




Timothy A. Jordan 
Assistant Vice Chancellor for 
Business Affairs - Finance 



Assets 

Cash 

Investments 

Deposits with trustees 

Accounts and notes receivable, 

less allowance of $68,111 
Inventories, at cost using first in-first out 
Prepaid Expenses and deferred charges 
Land 

Land improvements 
Buildings 
Equipment 
Library books 
Construction in Progress 

Total assets 

Liabilities 

Accounts payable 

Accrued liabilities 

Students' deposits 

Due to other funds 

Deferred credits 

Notes payable 

Capital leases payable 

Bonds payable 

Deposits held in custody for others 

Total liabilities 

Fund Balance 

Unrestricted 

Restricted 

Endowment 

Quasi- endowment-unrestricted 

Quasi-endowment-restricted 

Plant Funds 

Total fund balances 

Total liabilities and Fund balance 



Current Funds 


Loan 
Funds 


Endowment 
Funds 


Plant 
Funds 


Agency 


Unrestricted 


Restricted 


Funds 


$3,852,786 


$352,417 


$ 55,870 


1,008 


$ 4,916,144 


$ 13,871 
534,777 








2,610,732 


2,138,775 


495,322 


350,971 


336,425 


1,017,544 


230,100 


12,320 




813,928 








15,000 
582,607 
2,724,245 
36,248,895 
8,545,588 
9,411,426 
4,247,460 


15,600 


$5,017,685 


$688,842 


$1,073,414 


$2,841,840 


$68,842,460 


$1,059,570 


$ 105,707 


$ 833 


$ 301 




$ 385,907 


$ 25 


682,777 


20,533 


300 




421,021 




496,096 












39,131 


1,428 
57,407 






30,529 

2,858,370 

862,057 

11,000,000 


1,059,545 


1,323,711 


80,201 


601 





15,557,884 


1,059,570 


3,693,974 


608,641 


1,072,813 


1,221,359 

1,450,049 

170,432 


53,284,576 




3,693,974 


608,641 


1,072,813 


2,841,840 


53,284,576 





$5,017,685 


$688,842 


$1,073,414 


$2,841,840 


$68,842,460 


$1,059,570 



The accompanying notes are an integral part of the financial statements. 



Statement of Changes in Fund Balances 

For Year Ended June 30, 1986 



Current Funds 



Unrestricted 



Restricted 



Revenues and Other Additions 
Unrestricted current fund revenues 
State appropriations- restricted 
Federal grants and contracts- restricted 
State grants and contracts-restricted 
Private gifts, grants, and contracts- restricted 
Investment income- restricted 
Endowment Income 
Realized gains on investments 
Proceeds from notes and bonds issued 
Expended for plant facilities (including 

$5,105,481 charged to current funds 

expenditures) 
Retirement of indebtedness 
Other revenues 
Other additions 



$34,557,551 



2,054,456 

149,394 

235,205 

90,191 



(39,697) 
251,314 



Total revenues and other additions 



34,557,551 



2,740,863 



Expenditures and Other Deductions 

Educational and general expenditures 

Auxiliary enterprises expenditures 

Indirect cost recovered 

Expended for plant facilities 

Retirement of indebtedness 

Interest on indebtedness 

Disposal of plant facilities 

Notes and Bonds Issued 

Other expenditures and deductions 



25,540,970 
7,076,121 



2,489,549 
127,121 



Total expenditures and deductions 



32,617,091 



2,616,670 



Transfers Between Funds 
Mandatory: 

Principal and interest 
Renewals and replacements 
Loan Fund Matching 
Unrestricted funds allocated 



(2,663,418) 

(44,083) 

(26,697) 

(806,298) 



600 



Total Transfers 


(3,540,496) 


600 


Net increase/ (decrease) for year 
Fund balance at beginning of year 


(1,600,036) 
5,294,010 


124,793 
483,848 


Fund balance at end of year 


$ 3,693,974 


$ 608,641 



*Debt Service includes the Reserve for Renewal and Replacement of $590,131. 
This reserve is comprised of liquid assets only. 





Endowment 
and Similar 




Plant 




Loan 




Debt 


Investment in 


Funds 


Funds 


Unexpended 


Service 


Plant 


240,272 
912 




7,520,453 
29,163 


24,640 




1,035 
12,103 


58,612 

15,575 
81,734 


5,000 
52,202 


172,005 
2,140,000 


7,015,568 
3,931,125 

20,762 


254,322 


155,921 


7,606,818 


2,336,645 


10,967,455 



35,379 



15,575 



5,105,480 



8,899 



3,710,141 
1,193,631 



4,934 



303,092 
2,158,498 



35,379 


15,575 


5,114,379 


4,908,706 


2,461,590 


26,697 


20,885 


(50,652) 
784,813 


2,714,070 
44,083 




26,697 


20,885 


734,161 


2,758,153 




245,640 
827,173 


161,231 
2,680,609 


3,226,600 
1,260,788 


186,092 
1,571,302 


8,505,865 
38,533,930 


$1,072,813 


$2,841,840 


$4,487,388 


$1,757,394* 


$47,039,795 



The accompanying notes are an integral part of the financial statements. 



Statement of Current Funds Revenues, 
Expenditures, and Other Changes 

For Year Ended June 30, 1986 



Revenues 

Educational and General: 

Student Tuition and Fees 
State Appropriations 
Federal Grants and Contracts 
State Grants and Contracts 
Private Gifts, Grants and Contracts 
Endowment Income 
Investment Income 
Other Sources 

Total Educational and General 
Auxiliary Enterprises 

Total Current Funds Revenues 

Expenditures and Mandatory Transfers 
Educational and General: 

Regular Term Instruction 
Summer Term Instruction 
Extension Instruction 
Public Service 
Organized Research 
Libraries 

General Academic Support 
Student Services 
Institutional Support 
Physical Plant Operations 
Student Financial Aid 

Educational and General Expenditures 



Statement continues on pgs. 12-13. 



10 



Current Year 


Total 




Unrestricted 


Restricted 


Prior Year Total 


$ 4,556,911.88 


$ 0.00 


$ 4,556,911.88 


$ 3,696,017.16 


19,849,354.24 


0.00 


19,849,354.24 


17,391,350.33 


156,351.08 


2,054,456.25 


2,210,807.33 


2,161,844.18 


2,050.43 


149,394.18 


151,444.61 


97,892.65 


62,715.37 


235,205.26 


297,920.63 


305,767.90 


193,364.10 


51,685.34 


245,049.44 


227,821.76 


85,974.98 


38,505.14 


124,480.12 


121,219.05 


317,549.94 


(39,697.05) 


277,852.89 


282,932.46 


25,224,272.02 


2,489,549.12 


27,713,821.14 


24,284,845.49 


9,333,278.67 


0.00 


9,333,278.67 


8,114,661.14 


34,557,550.69 


2,489,549.12 


37,047,099.81 


32,399,506.63 


12,593,878.01 


204,905.04 


12,798,783.05 


11,372,904.32 


831,709.40 


0.00 


831,709.40 


725,159.27 


174,066.62 


0.00 


174,066.62 


187,531.14 


30,447.67 


0.00 


30,447.67 


52,643.73 


612,196.83 


707,521.69 


1,319,718.52 


1,498,485.96 


1,795,033.78 


96.19 


1,795,129.97 


1,362,023.86 


1,130,408.08 


100.00 


1,130,508.08 


898,409.16 


1,313,228.11 


0.00 


1,313,228.11 


1,127,071.06 


3,682,209.24 


12,888.83 


3,695,098.07 


3,186,396.50 


3,081,274.58 


0.00 


3,081,274.58 


2,608,829.96 


296,517.91 


1,564,037.37 


1,860,555.28 


1,511,333.42 


$25,540,970.23 


$2,489,549.12 


$28,030,519.35 


$24,530,794.38 



11 



Statement of Current Funds Revenues, 
Expenditures, and Other Changes 

For Year Ended June 30, 1986 



Expenditures and Mandatory Transfers (Cont'd) 
Mandatory Transfers for: 

Principal and Interest 
Loan Fund Matching 

Total Education and General Expenditures and Mandatory Transfers 

Auxiliary Enterprises: 

Expenditures 
Mandatory Transfers for: 

Principal and Interest 

Renewals and Replacements 

Total Auxiliary Enterprises 

Total Current Funds Expenditures and Mandatory Transfers 

Other Transfers In/(Out), Additions and (Deductions) 

Net Restricted Receipts over Deductions 

Not Counted as Revenues 
Allocation to Endowment Funds 
Other Transfers 

Total Other Transfers In/ (Out), 
Additions and (Deductions) 

Net Increase (Decrease) in Fund Balance 



12 



Unrestricted 


Restricted 


Total 


Prior Year Total 


$ 8,134.52 
26,696.86 


$ 0.00 
0.00 


$ 8,134.52 
26,696.86 


$ 8,502.00 
19,252.00 


25,575,801.61 


2,489,549.12 


28,065,350.73 


24,558,548.38 


7,076,121.11 

2,655,283.78 
44,083.03 


0.00 

0.00 
0.00 


7,076,121.11 

2,655,283.78 
44,083.03 


5,489,002.11 

1,631,097.49 
99,933.00 


9,775,487.92 


0.00 


9,775,487.92 


7,220,032.60 


35,351,289.53 


2,489,549.12 


37,840,838.65 


31,778,580.98 


0.00 
(20,885.00) 
(785,412.62) 


124,193.10 

0.00 

600.00 


124,193.10 

(20,885.00) 

(784,812.62) 


102,232.42 
(20,140.27) 
(396,090.75) 


(806,297.62) 


124,793.10 


(681,504.52) 


(313,998.60) 


($ 1,600,036.46) 


$ 124,793.10 


($ 1,475,243.36) 


$ 306,927.05 



The accompanying notes are an integral part of the financial statements. 



13 



Notes to Financial Statements 



1. Summary of Significant 
Accounting Policies: 



Reporting Entity 



Basis of Presentation 



Fund structure 



Basis of Accounting 



General Fixed Assets and 
Depreciation 



Cash and Cash Equivalents 



The accompanying financial statements present all funds under the authority of 
the University. The basic criterion for inclusion is the exercise of oversight 
responsibility. Oversight responsibility is derived from the ability to significantly 
influence operations and accountability for fiscal matters. Related Foundations 
and similar non-profit corporations are not part of the University reporting 
entity and are not included in the accompanying financial statements. 

The accompanying financial statements are presented on a fund basis and 
generally follow the form recommended by the National Association of College 
and University Business Officers (NACUBO) and the American Institute of 
Certified Public Accountants in its Industry Audit Guide, Audits of Colleges 
and Universities. 

The accompanying financial statements are structured into three categories of 
funds: Current, Fiduciary, and Plant Funds. 

The Current Funds are used to account for all financial transactions of the 
general operations of the University, with the unrestricted and restricted funds 
shown separately. Also, the proprietary funds reflecting the operations of the 
Bookstore, dormitories, and other auxiliary enterprises and internal service 
funds are shown separately from the other University unrestricted funds. 

The Fiduciary Funds are used to account for the Student Loan Funds, 
Endowment Funds, and Agency Funds held by the University. The Agency 
Funds are those funds of students and organizations held by the University as 
custodian. The transactions of the Agency Funds do not result in any revenue 
or expenditures for the University; therefore, these funds are not reflected in 
the statement of changes in fund balances. 

The Plant Funds are used to account for the Unexpended Plant Funds, Debt 
Service funds, and the Investment in Plant Funds. The Debt Service funds 
include the Repair and Replacement reserves, as well as the reserves for 
Retirement of Indebtedness. 

The accounting records of The University of North Carolina at Wilmington are 
maintained on the cash basis of accounting throughout the year, but 
adjustments are made at fiscal year- end to convert to generally accepted 
principles of accounting for colleges and universities. The generally accepted 
basis of accounting for colleges and universities is the accrual basis, except that 
no depreciation expense is reflected. 

All fixed assets are reflected as expenditures of the fund when purchased in the 
year of acquisition. The fixed assets acquired are reflected as an addition to the 
Investment in Plant Funds and carried at the cost of acquisition until disposed 
of. No depreciation is reflected. 

In addition to cash on deposit with the State Treasurer, bank accounts, petty 
cash, and undeposited receipts, this classification includes all short-term 
investments, such as savings accounts and certificates of deposit. 

14 



Deposits with Trustees 



Investments 



Receivables and Allowances for 
Doubtful Accounts 



Inventories 



2. Pension Plans: 



3. Insurance: 

4. Commitments and Contingencies: 

Vacation and Sick Leave 



This account reflects all cash deposited with the Fiscal Agents for investment 
on behalf of the University. 

This classification includes a long-term fixed income investment and equity 
investments held by the University. The investments purchased are valued at 
cost and investments received by gift are valued at the fair market or appraised 
value at the date of the gift, unless there has been an impairment of value not 
considered to be temporary. At June 30, 1986, the market value of capital 
stock held by the Endowment Fund was $5,697.75. 

The receivables, except for NDSL notes receivables, are reflected in the 
accompanying financial statements at book value with no provision for doubtful 
accounts. NDSL notes receivable are reflected at net value with an allowance 
for doubtful accounts in the amount of $68,111.00. With the above-noted 
exception, the University used the direct write-off method of expensing all 
accounts deemed uncollectible at June 30 each year. 

Inventories held by the University are priced at cost using the First- In, First- 
Out Method. The inventories for the General Restricted Current Funds consist 
of expendable supplies, gasoline and fuel oil held for consumption. Inventories 
for the Preprietary Funds consist of textbooks and merchandise for resale, as 
well as expendable supplies held for consumption. 

Each permanent full-time employee, as a condition of employment, is a 
member of the North Carolina Teachers' and State Employees' Retirement 
System, although eligible faculty of the University may elect to become 
members of the Teachers' Insurance and Annuity Association (TIAA-CREF), a 
privately administered retirement plan. Employees contribute six per cent of 
gross wages with the University matching with an 11.20% contribution to the 
North Carolina Teachers' and State Employees' Retirement System. The 
employees participating in the Teachers' Insurance and Annuity Association 
retirement plan contribute six per cent of gross wages with the employer 
matching also being six per cent. The University has no pension plan 
obligations beyond the matching already paid into the retirement systems. The 
University contributed $1,669,762.09 as matching pension costs during 
the year. 

The State maintains a State Property Fire Insurance Fund as a means of self- 
insurance against fire losses which may occur in State-owned buildings. 



The University, in accordance with State policy, records the costs of vacation 
and sick leave when taken and paid, rather than when the leave is earned. 
State policy provides for a maximum -accumulation of unused vacation leave of 
30 days which can be carried forward each January 1st for which an employee 
can be paid upon termination of employment with the State. Under this policy, 
the accumulated vacation leave for each employee at June 30 would equal the 
leave carried forward at the previous December 31, plus the leave earned and 
less the leave taken between January 1 and June 30. The accumulation of 
unused sick leave earned is unlimited, but the employee cannot be 
compensated for any unused sick leave upon termination of employment. 
Consequently, at June 30, 1986, the University had an actual, but unrecorded, 
liability for unused vacation leave in the amount of $737,230.00, and a 
contingent liability for the unused sick leave in the amount of $1,473,146.00 
based on salary rates effective June 30, 1986, including matching benefits for 
retirement and social security. 



15 



Leases 



5. Changes in Plant Fixed Assets: 



6. Long-Term Obligations: 



Capital leave obligations relating to (type of facility or equipment) are recorded 
at the present value of the lease payments. Leased assets included in the Plant 
Funds amounted to $1,386,662.26 at June 30, 1986. 





Fiscal Year Capital Leases 


Operating Lease 




1987 


$ 311,690.23 


$ -o- 




1988 


311,388.61 


-0- 




1989 


300,959.12 


-0- 




1990 
tits: 

Payments 

in the fixed asset 


83,956.31 

1,007,994.27 

145,937.58 


-0- 


Total Minimum Lease Payme 


$ -o- 


Amount Representing Interest 




Present Value of Future Lease 


$ 862,056.69 




A summary of changes 


s is presented as follows: 






Balance 








July 1, 1985 


Additions Deletions 


June 30, 1986 


Land 


$ 582,606.94 


$ -0- $ -0- 


$ 582,606.94 


Land Improvements 


2,188,437.21 


535,807.78 -0- 


2,724,244.99 


Buildings 


31,677,600.39 


4,926,652.46 355,358.13 


36,248,894.72 


Machinery & Equipment 


7,659,222.78 


1,082,858.10 196,492.23 


8,545,588.65 


Library Books 


8,618,206.13 


795,209.72 1,989.88 


9,411,425.97 


Construction in Progress 


4,300,910.29 


4,959,590.57 5,013,040.46 


4,247,460.40 


Total 


$55,026,983.74 $12,300,118.63 $5,566,880.70 


$61,760,221.67 



A summary of changes in the long-term obligations (principal only) is presented 
as follows: 



Bonds Payable 
Notes Payable 
Capital Leases 

Total Long-Term Obligation 



Interest 



3.0-11.4 
5.0-9.95 
6.6-8.6 



Balance 
July 1, 1985 

$ 9,715,000 
5,713,510 
1,064,544 



Additions 

$1,500,000 

640,000 

18,498 



Balance 
Deletions June 30, 1986 

$ 215,000 $11,000,000 

3,495,140 2,858,370 

220,985 862,057 



$16,493,054 $2,158,498 $3,931,125 $14,720,427 



The University bonded indebtedness arises from issues to construct dormitory, 
dining, and physical education facilities and are payable from pledged student 
fees as provided by the Bond Resolutions. Principal payments are made on 
January 1 of each year in increasing amounts that are sufficient to retire the 
bonds by January 1, 2010. Interest is paid on January 1 and July 1 of each year 
at rates varying from 3% to 11.4% APR. The University receives an annual 
debt service subsidy grant in the amount of $24,640.00 from the United States 
Department of Housing and Urban Development with respect to the Dormitory 
and Dining Hall Series B Bonds. The bonds are further secured by reserve 
requirements as provided in the Bond Regulations, totaling $1,616,127.03 at 
June 30, 1986. The University was in compliance with all reserve requirements 
as of June 30, 1986. 

The schedule that follows shows the annual requirements to pay principal and 
interest on the long-term obligations outstanding at June 30, 1986. 





Revenue Bonds 


Notes 


Capital Leases 


1987 


$ 1,028,811.00 


$ 693,590.79 


$ 311,690.23 


1988 


1,111,830.00 


476,640.74 


311,388.61 


1989 


1,097,900.00 


444,842.50 


300,959.12 


1990 


1,103,100.00 


419,416.33 


83,956.31 


1991 


1,101.035.00 


387,949.23 


-0- 


1992-1996 


5,441,410.00 


1,523,934.56 


-0- 


1997-2001 


5,607,210.00 


163,241.00 


-0- 


2002-2006 


3,737,550.00 


-0- 


-0- 


2007-2011 


1,180,050.00 
$21,408,896.00 


-0- 


-0- 


Total Requirements: 


$4,109,615.15 


$1,007,994.27 



16 



ARCHIVE COLLECTION 




RANDALL LIBRARY 

AS 

./lf(p 

my 

RANDALL LIBRARY - UNCW 



3 0690 1622278 3 



Board o£ Trustees 

B.D. Schwartz 

Chairman 

F. P. Fensel 
Vice Chairman 

Betty H. Cameron 
Secretary 

W. Albert Corbett 
Bishop Ruben L. Speaks 
John D. Warlick, Jr. 
Eugene E. Wright, Jr. s M.D. 
John J. Barney, Jr. 
John B. Codington, M.D. 
Margaret F. Heyward 
John D. Merritt 
Justin Raphael 



Senior Officers 

William H. Wagoner 
Chancellor 

Charles L. Cabill 

Provost and Vice Chancellor for 

Academic Affairs 

R. O. Walton, Jr. 
Vice Chancellor for Business Affairs 

F. Douglas Moore 
Vice Chancellor for University Advancement 

William A. Bryan 
Vice Chancellor for Student A