Loading...
HomeMy WebLinkAbout99-00100 I "..... . .S . ... ~ ~I , f <)-! C)o-I ,~ N.:.. q9- 100 .~;j"~a..~~O""","-~,,~_". _, . -j EAST PENNSaORO AREA SCHOOL DISTRICT ENOLA, PENNSYLVANIA JUNE 30, 1998 " {J ~P. - vi'CCJ!nwnlt.f. CIII//fJi1HIf. ! C:a;.,y.o/ ;i!,,<-:-"'......~ EAST PENNSBO~O AREA SCHOOL OIST~ICT COM~INED STATEMENT OF ~EVENUE, EXPENDITU~ES AND CHANGES IN FUND BALANCES . BUDGET AND ACTUAL . OEtlEAAL AND SPECIAL ~EVENlJE FUNDS YEAR ENDED .TUNE 30, 1998 Revenue and other financing sou roes Looal sources State sources Federal sources Total revenue and other financing sources Expenditures and other financing uses Instruction ~egular programs 3pecial programs Vo~ational education programs Other instructional programs Adult education programs Community College education programs Total instruction Support servicee Pupil pereonnel Instructional staff Administration Pupil health Business Operation and maintenance of plant services Student transportation services Central Other support services Total support services I!~ Oenera1 Fund ~1lA1 Vadance Favorable. (Unfavorable) $ 13,784,328 $ 14,091,299 $ 306,971 5,674/573 5,585,626 (88,947) 242,63B 236~ (6 .104) 19,701...lli !1!....2..U....ti2 _.. 211,920 9,892,128 1,889,028 225,597 136,038 8,5],7 264.890 12.416.198 4B1,823 652,632 1,472,523 244,515 193,640 1,749,761 515,980 56,182 48.071 5,515.ill (Continued) , 4 . 9,a63,486 1,880,515 225,597 132,549 8,438 28,642 8,513 3,489 79 264.868 22 ,p.375JJU 40.7_'1.2. 474,652 617,520 1,417,750 232,156 193,226 7,171 35,112 54,773 12,359 414 1,731,148 615,209 36,821 48.067 18,613 771 13,361 -i S.366.5ti --1.ll,578 -- SDeQial Revenue Fund BudQet Actual Vari ance Favorable (Unfavorable) $ 32,300 $ 33,232 $ 932 . 32.300 33.232 932 - -0- -0- -0- -0- ._-,:.Q.:. -0- SDecilll ~evenue Fund BudClet Actulll Varianoe Favorable <Unfavorable I $ B3,012 $ 104,420 $ (21,408) B3.012 104.420 (21.lli) -0- -0- -I)- ---=..2..:. -0:. -0- B3.012 ----1Q.L..4.aQ. (21. 40B) (50.712) m.U..!)) (20.476) 50,712 69,9BO 19,26B 50. 712 69.9BO 19.26B $ -0- -0- , -0- $ (l,20B) (l,20BI 3.465 3.465 2.257 $ 2.257 EAST PENNSBORO AREA SCHOOL DISTRICT COMBINED STATEMENT OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS . ALL PROPRIETARY FUND TVPES YEAR ENDED JUNE 30, 1998 Total operating revenue F'(jod ~.tll!a $ 412.088 412.08B 542,491 25,357 11, OS 9 6.3Q8 585. 21~ (173.l,27) 1,514 13,356. 128,654 25.357 ~ (4,246) _19.01:2 14,816 62.443 '$ '77.259 Operat ing reVemll'l Looa1 souroes . food service revenue Operating expenses Payments to food service contractor Donated commodities consumed Supplies Depreoiation Total operating expenses Qpel'at ing income (108s) Nonoperating revenue (expenses) Earnings on investments State sources Federal sources Federal sour~es - donated commodities Total nonoperating revenue (expensee) Inoome (loss) before transfers Fund transfers Noncash contributions from General Fund Net income (loss) Retained earnings, July 1, 1997 Retained earnings, June 30, 1998 The accompanying notes are an integral part of these financial statements, .. 6 . reAST PENNSBORO AREA SCHOOL DISTRICT COMBINED STATE~ENT OF CASH FLOWS . ALL PROPRIETARY FUND TYPES YEAR ENDED JUNE 30, 1999 Food Service Cash flows from oper<lting <lctivities Operi!lting income Iloss) Adjustments to reconcile operating income (loss) to net cash provided by operating activitisA Depreciation DOllated cOlOmodi ties cOllsumed Decrease (increase) in Inventory Accounts receivable Increase (decrease) in Accounts payable $ (173,127) 5,308 25,357 1,373 (3,021) . 54,923 Net c<lsh used in operating aotivities (89,107) C<lsh flows from noncapital financing activities Subsidies received State Federal Fund transfers 13,356 129,654 19,062 Net cash provided by noncapital finanCing activities 161.0..ll Cash flows from invssting activities Earnings on investments Payment for purchases of equipment 1,514 (14.382) Net cash used in investing activities (12.969) Net increase in cash 60,017 Cash and equivalents, July 1, 1997 42.916 Cash and equivalents, June 30, 199B $ 102.833 The aocompanying notes are an integral part of these financial statements, . 7 . EAST PENNSBORO AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS JUNE 30, 1998 1. Reporting entity East, Pennsboro Area School District is the level of government which has oversight, responsibility and control over activities related to public school education. The report includes services provided by the District to residents within its boundaries, the Cun'berland County communitiea of East Pennsboro Township and the Borough of West Fairview, Services provided include a comprehensive curriculum for Primary and secondary education aa well as special education and vocational education programs, The District receives revenue from local, etate and federal sources and must comply with the >:equirements of these funding sources. Criteria eetablished in Governmental Accounting Standards Board Statement Number 14 were used in dstermining the entities to be included in the reporting entity, These criteria include bade items such as financial interdependency, selection of governing authority, designation of management, ability to significantly influence operations, accountability for fiscal matters, scope of public service and special financing relationships, All operations of the District are included in the reporting entity, 'fhere are no component units that meet the above cri teria for inclusion in this reporting entity, However, the District is a participant in three jointly- governed operations, each of which is a separate legal entity that off!!r.. educational services to the District and its residents, Each entity serves se'/eral school districts, so the following entities are not included in this reporting entity, Capital Area Intermediate Unit - provides special education services and programs. Cumberland-Perry Area Vocational-Technical School - provides vocational and technical education services and programs, Harrisburg Area Community College - provides community college education services and prDgrams, 2, Summary of significant accounting policies The accounting records Df East Pennsboro Area School District are maintained on the basis of accounting practices prescribed or permitted by the Manual of Accounting and Related Financial Procedures for Pennsylvania School Systems, issued by the Pennsylvania Department of Education in accordance with the provisions of the School Laws of Pennsylvania. These practices are in conformity with generally accepted accounting principles as applicable to governmental units, A summary of the more signHicant accounting policies follows, - 8 - EAST PENNSBORO AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMEN1'S I Cont ' d, ) ,JUNE 30, 1998 2, Summary of s igni ficant account ing polides ((;ont' d, ) Basis of accounting (Cont'd,) account Groups ( Cont' d, ) Compensated absences (those for which employees receive pay) are recorded using the termination payment method, A liability is recorded through the use of estimates which apply historical data to current factors, The District maintains records of unused leave and applies the contracted rate for employees eligible for termination payments, The District allows only restricted sabbatical leave and therefore has no recorded liab,ility in advance of the sabbatical, Cash and cash equivalents The Distrir.t pools caeh resources of certain funds in order to facilitate the management of cash, As part of this cash management program sponsored by the District's depositary institution, overnight repurchase agreements are bought and sold on a 'regular basis to increase interest earnings, Cash and cash equivalents applicable to a particular fund are readily identifiable, The balances in the pooled cash management accounts are available to meet current operation requirements, For purposes of the Food Service Fund etatement of cash flows, the District considers all deposits purchased with an original maturity of three months or less to be cash or cash equivalents, Budge t s The District adopts, prior to the beginning of each fiscal year, an annual budget for the General Fund and Athletic Fund, A part of this budgat process is the adoption of 100al tax rates, subject to various legal restrictions, The District approves subsequent budget revisions (primarily transfers between expenditure categories) as necessary, Unused appropriat.ions expire at the end of each year, Revenue w Local sources Real estate, occupation and per capita taxes are levied as of July 1 with a legal, enforceable claim against the taxpayer and/or property, These taxes are recognized as revenue when received during the fiscal year and also estimated to be received within sixty days after the end of the fiscal year, Amounts estimated to be receiv~d between sixty days and one year after the end of the fiscal year are recorden as deferred revenue, An allowance for uncollectibles is recorded for taxes estimated not to be collectible within one year after the end of the fiscal year, Ot.her tax revenues, including taxpayer - assessed revenues such as earned income taxes, are recognized as revenue when received during the fiscal year or BOon enough thereafter to be susceptible to accrual, - 12 - EAST P~NNSBORO ARBA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS (Cont'd.) JUNE 30, 1998 2. Summary of significant accounting policies (Cont'd.1 Revenue State sources State Bubsidies due the District as current fiscal yellr entitlements are recognized as revenue in the current fiAcal year. Revenue - Federal sources Federal program funds applicable to expenditures in the current fiscal year but expected to be received in the next fiscal year are recognized as revenue in the current fiscal year. Pension plan Substantially all full-time and part -time employees of the District participate in a cost"sharing multiple employer defined benefit pension plan. The District recognizes expenditures or expenses equal to its contractually-required contributions, subject to the modified accrual basis of accounting in governmental funds. Inter-fund transactions Expenditures by the General Fund for the benefit of other fundo are reflected in the respective statements of revenue and expenditures/expenses, based on management's estimates. The District doeo not attempt to allocate all costs which benefit the other funds due to the difficulties associated with the measurement of such benefits. 3. Cash and investments The Oistrict's cash and cash equivalents consist of cash balances deposited in financial institutions and repurchase agreements purchased by the District from the financial institutions as part of a cash management account. Cash at June 30, 1998 is categorized as follows: Cash and cash eauivalents Carrying -Y;.lue $ 500 $ 100,000 137,983 $ 238.483 $ Bank Ba 1lll1ce Change funds Insured (FDIC) Collateral held in the Dist.rict' s name Collat.eral not held in the District's name 100,000 462 ,ill Total 562 , 774 - 13 - EAST PENNSBORO AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS (Cont'd) JUNE 30, 1998 3. Caso and investments (Cont.'d.) The types of authorized investments are limited by state regulations. The District's investments consist. of deposits in authorized pooled investment funds. These investments are carried at cost which approximates market value. At June 30, 1998, all investments of t.he Trust were either obligations of the U.S. Government or its agencies or instrumentalit.ies, or deposits insured by f'DIC, and are categorized as follows: lJ1Ve S t!!ill.l1U Insured (F'DIC) Collateral held in the District's name Collatet'al not held in the District.' s name Pooled investment~: PA Local Government Investment Trust PA Loc~l Government Investment Trust. Arbitrage Rebate Management Program FA Treasurer's Invest Program for Local Governments Total Investment policies followed during the year ended June 30, 1998 did not significant.ly alter the cat.egorization of investments shown above. 4. Accounts receivable Accounts receivable at. June 30, 1998 consist of the following: Food General Service Fund Fund Federal subsidies $ 119,556 $ 1,26~ Stat.e subsidies 231,326 115 Due from other governmental units 35,414 Due from EIT/OPT collector 346,682 Other receivables _~.lli $ 732,978 $ 3.517 5, Delinquent taxes receivable As explained in Note 2, taxes are recorded as revenue only when received, or, in the case of delinquent. real estate taxes, available wit.hin sixty days. The remaining balance of delinquent taxes receivable are recorded as deferred revenue in accordance with school accounting policies. Deferred tax revenue amounted to $ 351,017 at. June 30, 1998. Delinquent taxes receivable as reflected on the June 30, 199B balance sheet consist. of the following, - 14 - EAST PENNSBORO AREA SCHOOL DISTRICT NOTES TO FINANCtAL STATEMENTS (Cont'd.) ,TUNE 30, 1998 As explained in Not.e 2, buildings and equipment are reflected on the balance sheet under the General Fixed Assets Group of Accounts stated at historical cost or estimated historical cost. if actual historical costs are not l\vailable. A summary of changes in fixed assets for the year ended June 30, 1938 is as follows. Beginning of Year &lditions General fixed assets Land and improvements $ 325,856 $ Buildings and improvements 21,105,440 142,815 Furni ture and equipment _h595.715 1.257,527 $ 24.027,011 $ 1.400.342 Transfers and Disposals End of Year $ $ 325,856 21,248,255 3,853,242 $ "0- $ 25.427,353 - 15 - EAST PENNSBORO AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATgMENTS (Cont'd.) JUNE 30, 1998 6. General Fixed Assets (Cont'd.) Transfers Beginning and End ..2LXaL Additions Disposals of Year Food Service Fund fixed assets Furniture and equipment $ 198,81.3 $ 14,382 $ $ 213,205 Accumulated depredation (171,739) --...J.p~) (178,047) $ 27,084 $ 6.074 $ -O- S 3S,.lS~ 7. General obligation bonds and notes payable A summary of changes in general obligation bonds and notes payable for the year ended June 30, 1998 is as follows: Beginning of Year_ Additions Payments and other ~creases End 2LX.a!: General Obligation Bonds Series of 1992, 2.'10% to 5.80%, maturillg 9/1/2012 $ 7,855,000 $ $ 7,855,000 $ Series of 1989, 6.40% to 7.45%, mat.uring 9/1/2006 5,334,930 355,298(a) 810,000 4,880,228 Series A of 199'1, 3.80% to 5.05%, maturing 9/1/2011 8,220,000 8,220,000, Series AA of 1997, 4.00% t.o 4.20%, maturing 9/1/2001 1.115.000 1.115,000 13,189,930 9,690,298 8,665,000 14,215,228 General Obligation Notes, Series A of 1997, Variable rate, ma~uring 1/3/2000 10,000,000 - 1Q....Q.00.000 $ 13,189.930 $ 19,690.298 $ B.665.00D $ 24.215.22~ (a) Represents accreted interest on Capital Appreciation Bl'nds. - 16 - EAST PENNSBORO ARE" SCHOOL DISTRiCT NOTES TO FINANCIAL STATEMEN'I'S ICont' d.1 JTJNE ]0, 1998 7. General obligation bonde and notes pay&ble (Cont'd.) Total scheduled debt service payment.s for all general obligation debt as of Juno 30, 1998 are as follows: Series All Other S!!ries of 1989 Capital Appreciation Iu.J: Total Principal. Interest Bonds ( 1) 1998-1999 $ 1,852,808 $ 195,000 $ 847,808 $ 810,000 1999-2000 12,009,2J.6 10,590,000 619,2J.6 BOO,OOO 2000 - 2001 1,791,180 640,000 381,180 770,000 2001-2002 1,788,565 675,000 353,565 760,000 2002 - 2003 1,392,985 305,000 332,985 755,000 2003 and thereafter 11.341. 362 6.930,000 1,846,362 2.565,000 Tota Ie $ 30.176,1l6 $ 19,335,000 $ 4.381.116 $ 6,460.000 (1) Reflects final maturity value of Capital Appreciation Bonds. In August 1997, t.he DistIict borrowed $ 9,335,000 through the issuance of General Obligation Bonds, series A and Series AA of 1997. Interest on the Series A bonds, in the aggregate principal amount of $ 8,220,000, range from 3.80' t.o 5.05' and mature from 1998 through 2011. Net proceeds from the Series" bonds were used to refund the District's Genoral Obligation Bonds, Series of 1992. Interest on the Series AA bonds, in the aggregate principal amounts of $ 1,115,000, range from 4.00' to 4.20' and mature from 1999 through 2001. Net proceeds from the Series AA bonds will be used toward the purchase and installat.ion of computers and infrastructure to implement the District's technology plan. On Sept.ember 2, 1997, the District. borrowed $ 10,000,000 through the issuance of the General Obligation Note, Series A of 1997 to the Emmaus Gel\eral Authority of Emmaus, Pennsylvania. Interest on t.his note is payable mont.hly at a variable rate of .55' above the "weekly rate", up to a maximum of 15.55\. At June 30, 1998,. the effective rate was 4. 25~. The not.e is due and payable in full on January 3, 2000, Proceeds from the note are to be used to finance the cost. of planning, designing, constructing and equipping of elementary school projects or alteration and renovat.ions to existing facilities. During the year ended June 30, 1998, $ 349,630 of interest waB paid within the Capital project.s Fund. As part of the Series" of 1997 Note, the District was required to enter into a Credit Agreement with Bayeriscle Landeshank Girozentrale, New York Branch in which the Bank agrees to issue a letter of credit in the amount of $ 10,247,727 to provide funds for the repayment of the note through January 2000, if other financing has not been arranged. - 17 - EAST PENNSBORO AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS (Cont'd.) J'JNE 30, 1998 9. Leane commitments At .June 30, 1990, the Dist.rict was leaalng four photocopying machines pUl"Buant .to various lease agreements whioh are being accounted for as operating leases. Total lease rental payments during the year ended June 30, 1998 were $ 58,228. Minimum net leMe rental payments for future periods are expect.ed to be as followo: 1998-1999 1999-2000 2000 - 2001 2001-2002 $ 53,410 25,803 6,085 2,028 10. Pension plan The District contributes to a governmental cost-sharing multiple-employer defined benefit pension plan administered by the Pennsylvania Sohool Employees Retirement System (PSERS). Benefit provisions of the plan are established under the provisions of the PSERS Code (the Code) and may be amended by an act of the penr.sylvania State Legislat.ur.e. The plan provides retirement, disability and death benefit.s, legiAlatively mandated ad hoo cost-of..living adjustments, and healthcare insuranoe premium assistance to qualifying plan members and beneficiaries. It also provides for refunds of a member's accumulated contribution upon t.ermination of a member's employment in the public school sector. PSERS issues a publicly available financial report that inchldes financial statements for th" plan. That report may be obtained by writing to PSERS, P.O. Box 125, Harrisburg, PA 17108-0125. The contribution polioy is set by the Code and requires cont.ributions by active employees and by participating employers. Plan members ax'e required to contribute 5.25 percent of their compensation if they joined the plan before July 22, 1983, and 6.25 percent if they joined on or after that date. The contributions required of participating employers is basect on an actuarial valuation and is expressed as a percentage of annual covered payroll during the period for whioh the amount is determined. Districts pay the entire employer contribution rate and are reimbursed by the Commonwealth in an amount equal to the Commonwealth's share as determined by the income aid ratio (as defined in Act 29 of 1994), which is at least one-half of the total employer rate. The District's contributions to PSERS for the years ending June 30, 1998, 1997 and 1996 were $ 938,331, $ 1,075,186 and $ 1.142,616, respectively. Those amounts are equal to the required contribution for eaoh year. 11. Management services The cafeteria facilities of the District were operated by a third party vendor. Under the terms of the contract, the vendor provides for the open.tion and maintenance of food services as required by law, with the policies subject to the approval of the Distriot. Op"t.ating cCoSts, management fees and administrative costs are billed monthly to the District. - 19 - EAST PENNSBORO AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS (Cont'd.) JUNE 30, 1998 12. Other post-employment retirement benefits The District offera one post-employment benefit to retired professional employees other than pension benefits as discussed in Note 10. For employees with twenty or more years of service to the District, the District will pay the basic medical insuranoe premiums for five years (excluding family coverage) fOllowing retirement. This benefit amount.ed to approximately $ 64,000 during the year ended June 30, 1996 and covered 20 eligible retired employees. The District does allow other employees not eligible for this benefit to remain in its gt'OUp medical insurance plan upon payment by the retired employee of t.he cost of such coverage. 13. Risk management The District is exposed to various risks of loss related to torts; theft of, damage to, and deetruction of assets; errors and omissions; injuries t.o employees; and natural disasters. The District maintains commercial insurance coverage covering each of those risks of loss. Management believes such coverage is sufficient to preclude any significant. unihsured losses to the District. Settled claims have not exceeded this commercial coverage in any of the past three fiscal years. For purposes of Stilte unemployment compensation laws, t.he District has elected not to be covered by the Pennsylvania Unemployment Compensation Fund. Any unemployment. claims are paid by the District on a quarterly basis as incurred. The District is a member of a group of School OJ stricts who have joined together to Bel f -insure their workers' compensation exposure. The District pays annual contributions to the group based on a formula utilizing the District's own claim experience and annual payroll. Claim. in excess of the District'. retention experienoe are paid by a Central Fund within the group and, if necessary, by an insurance company carrying excess liability coverage. 14. Commitments and contingencies The collective bargaining agreement between the District and t.he t.eaching staff expires on August 31, 2000. In the normal course of preparing for the subsequent sohool year, the District has awarded bids for various supplies, fuel contracts, etc. No major commitments in excess of routine requirements have been made by the District. The District participates in numerous stat.e and federal grant programs which are governed by various rules and regulations of the grantor agencies. Costs charged to the respective grant programs are subject to audit and review by the grantor agencies; therefore, any findings or adjustments by the grantor agencies could have an effect on t.he reoorded grants receivable and/or deferred grant revenues, and on the related grant revenues and expenditures. - 20 M