HomeMy WebLinkAbout95-06580
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GREENAWALT & COMPANY, P.C.
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LA. QlllMAWALT (It.'"')
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CIRT.,IIO ,UILIC ACCOUNTANT'
P.O. eo. 6 400 Wu' MAIN s.Mn
MlCHANICSIUAG. PlNNs'LVANIA 170!S!S
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INDEPENDENT AUDITORS' REPORT
Board of School Directors
East Pannsboro Area School District
Enola, Pennsylvania
We have audited the accompanying general-purpose financial statements of
East Pennsboro Area School District as of June 30, 1995 and for the year then
ended. These general-purpose financial ~tatements are the responsibility of the
District's msnagement. Our responsibility is to express an opinion on these
general-purpose financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
.tandards and 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 general-purpose financial
statements are free of material misstatement. An audit includes examining, on
a teat basis, evidence supporting the amounts and disclosures in the general-
purpose financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall general-purpose financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion, the accompanying general-purpose financial statements
present fairly. in all material respects. the financial position of East
Pennsboro Area School District as of June 30, 1995, the results of its operations
and the cash flows of its Food Service Fund for the year then ended, in
conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards. we have also issued
reports dated September 20, 1995 on our consideration of East pennsboro Area
School District's internal control structure and on its compliance with laws and
regulations.
ni.U~A.,~t~,f.C.
~~ COH~ P.C.
September 20, 1995
Mechanicsburg, Pennsylvania
- 1 -
_au _ AMllICAN INIl11UTI 0. CPTmIID P\IIIUC ACCOUNT'NTS - rJlllNn1.VANlA 1NnmJ11l O. cDllPIID P\IIIUC ACCOUNTANTS
Propriatary
S'und Tvn.. Fidueia'(v
Food Trust and
S.rvie. ARencv
$ 47,893 $ 10,589
42,388
3,279
Fund ~vne8
Account Grouna
General General
Fixed Assets LonR-Term Debt
Activities
$
35,831
$
$
16,936
325,856
20,449,829
2,055,572
15,593
14.8]5.307
$ 83.701 $ 52.977 $ 35.831 $ 22.831.257 $ 14.835.307
$ $ $ $ $
13,651 19,100
23,288
12,453
10,589
35,831
14,334,367
500.940
26.104 52.977 35.831 -0- 14.835.307
22,831,257
15,593
42.004
57.597 -0- -0- 22.831.257 .0-
$ 83.701 $ 52.977 $ 35 831 $ 22 831.257 $ 14.835.307
EAST PENNS80RO AREA SCHOOL DISTRICT
COMBINED STATEMENT OF REVENUE, EXPENDITURES
AND CHANGES IN FUND BALANCES .
ALL GOVERNMENTAL FUND TYPES
YEAR ENDED JUNE 30, 1995
Special Capital
General Revenue Project
Revenua and other financing sources
Local sources $ 12,056,691 $ 38,854 $ 11,292
Stata sources 4,685,979
Federal sources 216,562
Other financing sources 64.276 45 . 000
Total revenue and other
finencing sources 17 .023.508 83.854 11 . 292
Expenditures and other financing uses
Instruction 10,324,147
Support services 4,475,526
Operation of noninstructional
sarviees 225,009 83,349
Facilities acquisition,
construction and improvements 119,054 84,174
Othar finsncing uses 1.476.711
Total expenditures and other
financing uses 16.620.447 83.349 84.174
Exe... of revenue and other financing
sources ov.r (under) expenditures
and othar financing uses 403,061 505 (72,882)
Fund balances, July 1, 1994 445.659 6.729 231. 360
Fund balances, June 30, 1995 $ 848.720 $ 7.234 $ 158.478
The accompanying notes are an integral part of these financial statements.
. 3 .
It
EAST PENNSBORO AREA SCHOOL DISTRICT
COMBINED STATEMENT OF REVENUE, EXPENDITURES AND
CHANGES IN FUND BALANCES . BUDGET AND ACTUAL
GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 1995
Revenue and other financing sources
Local sources
State sources
Fedaral sources
Other financing sources
Total revenue and other
financing sources
Expenditures and other financing uses
Instruction
Regular programs
Special programs
Vocational education programs
Other instructional programs
Adult education programs
Community College education
programs
Total instruction
Support services
Pupil personnel
Instructional staff
Administration
Pupil health
Business
Operation and maintenance of
plant services
Student transportation services
Central
Other support services
Total support services
o
Ceneral Fund
Variance
Favorable 0
Budilet Actual lUnfavorab Ie)
$ 11,825,459 $ 12,056,691 $ 231,232
4,658,810 4,685,979 27,169
224,523 216,562 (7,961)
30.000 64.276 34.276
16.738.792 17.023.508 284.716
8,316,875 8,301,357 15,518
1,507,037 1,495,186 11,851
257,153 257,153 .0.
35,783 30,034 5,749
9,298 7,521 1,777
294.310 232.896 61.414
10.420.456 10.324.147 96.309
467,359 461,231 6,128
440,228 417,590 22,638
1,269,488 1,258,122 11,366
201,459 200,444 1,015
143,437 140,913 2,524
1,489,957 1,433,882 56,075
513,534 513,133 401
28,376 21,818 6,558
29.919 28.393 1. 526
4.583.757 4.475.526 108.231
(Continued)
.4.
.
Sa.aial R.v.nu. Fund
Variance
Favorable
Bud.. t Actual (Unfavorable}
$ 25,000 $ 38,854 $ 13,854
45.000 45.000 -0-
70.000 83.854 13.854
-0-
-0-
-0-
.0-
-0-
-0.
.
EAST PENNSBORO AREA SCHOOL DISTRICT
COMBINED STATEHENT OF REVENUE, EXPENDITURES AND
CHANGES IN FUND BALANCES . BUDGET AND ACTUAL
GENERAL AND SPECIAL REVENUE FUNDS (Cont'd.)
YEAR ENDED JUNE 30, 1995
.
General Fund
Variance .
Favorable
Budie t Actual (Unfavorable)
Exp.nditure. and other financing
u... (Cont'd. )
Oparation of nonin.tructional .
services
Student activities $ 216,591 $ 208,666 $ 7,925
Community services 27.614 16.343 11.271
Total operation of non.
ins truc t iona 1 services 244.205 225.009 19.196 .
Facilities acquisition, construction
and improvement services 119.075 119.054 21
Othar financing uses
Debt service 1,423,800 1,423,796 4 .
Fund transfers 52.920 52.915 5
Total other financing uses 1.476.720 1.476.711 9
Budgetary reserve 54.045 -0- 54.045
.
Total expenditures and other
financing uses 16.898.258 16.620.447 277.811
Excess (deficiency) of revenue and other
financing sources over expenditures
and other finencing uses (159,466) 403,061 562,527 .
Fund balance, July 1, 1994 159.466 445.659 286.193
Fund balance, June 30, 1995 $ -0- $ 848.720 $ 848.720
0
The accompanying notes are an integral part of these financial statement..
o
- 5 .
o
SD.etal R.v.nu. Fund
lud..t
Actual
Variance
Favorable
(Unfavorabl.)
$
70,000 $
83,349 $
(13,349)
70.000
83.349
113.349)
-0-
-0-
-0.
-0- -0- -0-
-0- -0- -0-
70.000 83.349 113.349)
.0.
505
505
-0-
6.729
6.729
$
$
7.234 $
7.234
-0.
.."_.-A_.,"._.....____-,~,.......~~"""...-
EAST PENNSBORO AREA SCHOOL DISTRICT
COMBINED STATEMENT OF REVENUE, EXPENSES AND
CHANGES IN RETAINED EARNINGS
ALL PROPRIETARY FUND TYPES
YEAR ENDED JUNE 30, 1995
Net income (loss)
Food
S.rvlce
$ 352.990
352.990
477,595
29,096
6,797
3.314
516.802
(163.812)
1,987
7,915
12,170
113,519
29.096
164.687
875
56.722
$ 57.597
Oparating revenue
Local sources . food service revenue
Total operating revenue
Operating expenses
Paym.nt. to food aervice concractor
Donated COMmodities consumed
Supplies
Depr.c1ation
Total operating expenses
Oparating income (loss)
Nonop.rsting revenue (expenses)
Earnings on inve.tments
Noncash contributions from General Fund
Ststa sources
F.d.ra1 .ources
F.d.ral sources - donated commodities
Total nonoperating revenue (expenses)
Retained earnings, July 1, 1994
R.tained earnings, June 30, 1995
The accompanying notes are an integral part of these financial statem.nts.
.6.
.
.
EAST PENNSBORO AREA SCHCOL DISTRICT
COMBINED STATEMENT OF CASH FLOWS
ALL PROPRIETARY FUND TYPES
YEAR ENDED JUNE 30, 1995
Caah flowa fro. opar~ting activitiea
Op.ratina incom. (losa)
Adjuac.enta to reconcile operating income (loss)
to n.t ea.h provided by operating activities
Dapraciation
Noneaah contributions from General Fund
Donat.d commodities consumed
D.eraaae (increase) in
Inventory
Accounts receivable
Incr.aae (decrease) in
Accounts payable
Food
S.rvlc.
$ (163,812)
3,314
7,915
29,096
1,143
19,463
180.371)
(183.252)
Net cash uaed in operating activities
Caah flow. fro. noncapital financina sctivities
Subaidias received
StaU
F.daral
12,170
113.519
125.689
1,987
(2.295)
(308)
(57,871)
105.764
$ 47.893
Net caah provided by noncapital
financina activities
Caah flowa fro. inveating activities
laminaa on inveat.enta
Par-.nt for purchases of equipment
Net cash used in investing activities
Net increase (decrease) in cash
Caah and equivalents, July 1, 1994
Caah and equivalents, June 30, 1995
Th. acco.panying notes are an integral part of theae financial atatements.
- 7 -
EAST PENNSBORO AREA SCIlOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995
1. Reporting entity
East Pennsboro Ares School District is the level of government which has oversight
responaibility and control over activitles related to public school education.
The report includes services provided by the District to residents within its
boundaries: the Cumberland County communities of East Pennsboro Township and the
Borough of West Fairview. Services provlded include a comprehensive curriculum
for primary and secondary education as well as special education and vocational
education programs. The District receives revenue from local, state and federal
sources and must comply with the requirements of these funding sources.
Criteria established in Governmental Accounting Standards Board Statement Number
14 were used in determining the entities to be included in the reporting entity.
These criteria include basic items such as financial interdependency, selection
of governing authority, designation of manegement, 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.
There are no component units that meet the above criteria 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 offers
educational services to the District and its residents. Each entity serves
eeveral 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 programs.
2. Summary of significant accounting policies
The accounting records of 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 che
provisions of the School Laws of Pennsylvanis. These practices are in conformity
with generally accepted accounting principles as applicable to governmental units.
A summary of the more significant accounting policies is as follows:
. 8 .
EAST PENNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
2. Summary of significant accounting policies (Cont'd.)
.
Fund account Lng
.
Tha accounting records of the District are organized on the basis of fund type.
and account groups. Each fund type may consist of several different funds. Each
fund 1s a separate entity with self.balancing accounts which comprise its assets,
l1abilities, fund balance/retained earnings, revenues aod expendituras/axp.ns.s
as appropriate. The fund types and the sccount groups utilized by East Pennsboro
Ar.a School District are as follows:
Governmental Fund Tvoes - These are the funds through which most
governmental functions are finsnced. The acquisition, use and
balances of the District's expendable financial resources and the
relatad liabilities (except those accounted for in proprietary funds)
are accounted for through governmental funds. The measurement focus
is upon determination of changes in financial resources, rather than
upon net income determination. The funds of the District includad
in this cat.gory ara:
General Fund . The General Fund is used to account for aU
financial transactions not accounted for in anothar fund. Rev.nues
are primarily derived from local proparty, per capita and
occupation taxes, and State and Federal distributions. Many of th.
mor. important activities of the School Di.trict, ineludinl
instruction, administration of the School District and certain
noninstructional services are accounted for in this fund.
Special Revenue Fund - Special Revenue Funds are used to account
for the proceeds of specific revenues that are raatrict.d to
expenditures for specified purposes.
Capital Projects Fund. Capital Projects Funds are used to account
for financial resources to be used for the acquisition or
construction of capital facillties.
Proorietat:v Fund Tvoes - Proprietary Funds account for operatlons
that are financed and operated in a manner similar to private
business enterprises:
Food Servlce Fund - The Food Service Fund is used to account for
the financial transsctions associated with the operations of tha
cafeterias.
- 9 -
EAST PENNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
2. Summary of significant accounting policies (Cont'd.)
Fund accounting (Cont'd.)
Fiducisrv Fund ~YDes (Trust and A2encv Funds) - These funds account
for assets held in a trustee capacity or as an agent for other funds
or entities:
Trust and Agency Account . Accounts for proceeds from activitie.
open to the entire student body and faculty. Agency funds also
include a central payroll fund. The payroll fund accounts for
salaries earned by District employees. It handles the disbursing
of such amounts to the employees and to taxing and other agencies
on their behalf.
Activity Fund _ Accounts for programs operated and sponsored by
various clubs and organizations within the schools. Activity
funds are Agency Funds which are separately accounted for because
of legal requirements.
Account GrouDs _ The account groups are used to account for the
general fixed assets and general long- term debts of the District.
These sccount groups are not funds. They are only concerned with the
measurement of financial position and are not involved with the
measurement of results of operations.
General Fixed Assets - General Fixed Assets account for the
District's investment in fixed assets exclusive of those included
in the Food Service Fund. No depreciation has been provided on
general fixed assets. Interest costs incurred to purchase or
finance fixed assets is not capitalized as part of fixed assets.
General Long-Term Debt _ Long-term Uabilities expected to be
financed from governmental funds are accounted for in the General
Long-Term Debt Account Group. All long-term debt is offset by
deferred charges to future taxation. Interest on long-term debt
is recorded on the date such interest is due to be paid.
Basis of accounting
The accounting and financial reporting treatment applied by the different fund
types is based on their measurement focus, which determines when revenues and
expenditures are recognized.
- 10 -
EAST PENNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
2. Sunaary of eignificant accounting policies (Cont'd.)
Baeie of accounting (Cont'd.)
.
Goverlllllental Fund TVDes _ These funds are accounted for ueing a
"currant financial resources" measurement focus (a modified accrual
baeie of accounting).
Rav.nu.e are record.d when su.ceptibla to accrual (both lI.a.urabla and
availabl.). Available lIeane eollacted within the curr.nt pariod or
.oon .noulh thereafter to pay currant liabilitie..
Exp.ndituree are generally recognized when the related fund liability
i. incurred. Exceptions to this general rule include principal and
intereet on general long-term debt which is recogniz.d when dua.
Disbursements for inventory type itells and prepaid expeneea ara
eon.idered expenditures at the time of purchase.
proorietary Fund Tvoas _ The Food Service Fund is aceount.d for uaing
a "flow of econollic resources" measurement focus (a full accrual
lI.thod of accounting).
Don.t.d eOmlloditi.. are inventoried at an estillatad co.t valua wh.n
racaiv.d. Inventories (valued on the first-in, fir.t.out lI.thod) ara
raeord.d aI an asset, and the portion represented by donated
commodities is recorded as deferred revenue.
Food I8rviee equipment is capitalized, with depreciation (eollputad on
the .traight-lin. lIathod u.ing an e.tillat.d u..ful life of 12 year.)
r.eorded a. an operating expen.e. The equipllent (n.t of .ccuaulatad
d.pr.eiation) i. off.et by a reserved portion of retained aarning..
Fiduciarv Fund Tvn.. lTruat and A...ncV Funda) . Th... fund. are
cu.todial in nature (a..ets .qual liabilitial), which do.e not involva
lI.a.urall.nt of reeult. of operation., and utilize tha 1I0dified accrual
ba.i. of accounting.
Account Grouo. _ Land, building. and aquipllent are racord.d at
hi.torical cost or at e.tim.ted historical cost if actual hi.torical
co.t is not available. Deprecistion is not computed on general fixad
aeeete.
Long.term . debt is offset by an amount to be provided by futura
taxation or other revenue .ources. Bonde p.yable in futura yaars ara
recorded ae District debt. Interest on bonds is record.d whan euch
interest is due.
- 11 -
EAST PENNSIlORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
2. Summary of significsnt accounting policies (Cont'd.)
Basis of accounting (Cont'd.)
Account Grouos lCont'd.l
Compensated absences (those for which employees receive pay) are
recorded using the termination payment method. A liability La
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 record,d liability in advance of the sabbatical.
Cash and equivalents
The District pools cash 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
aold on a regular basis to increase interest earnings. Cash and equivalents
applicable to a particular fund are readily identifiable. The balances in the
pooled cssh management accounts are available to meet current operation
requirements.
Budgets
The District adopts, prior to the beginning of each fiscal year, an annual budget
for the General Fund and Athletic Fund.
The budgets are maintained on a modified accrual
object, with expenditures controlled by line item.
end of each year and must be reappropriated.
bssis by fund, function and
Appropriations lapse at the
The School Board approves budget transfers between departments within School
District funds. Budgeted amounts are as originally adopted or as amended by the
School Board at various times throughout the fiscal year.
Revenue Local sources
Real estate, occupation, residence 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 1.110
eatimated to be received within sixty days after the end of the fiacal year.
Amounts estimated to be received between sixty days snd one year after the end of
the fiacal year are recorded 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.
Other tax revenues, including taxpayer-assessed revenues such as earned income
taxes, are recognized as revenue when received during the fiscal year or soon
enough thereafter to be susceptible to accrual.
. 12 -
EAST PENNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
2. Summary of significant accounting policies (Cont'd.)
Revenue - State sources
State .ubsidies due the District as current fiscal year entitlem.nts are
recognized as revenue in the current fiscal year.
a.venu. . Federal sources
Federal program funds applicable to expenditures for the same program in the
current fiscal year but expected to be received in the next fiscal ye.r .r.
accrued aa current revenue.
Inter.fund transactions
Expenditures by the General Fund for the benefit of other funds are reflect.d in
the respective statements of revenue and expenditures/expensea, based on
IUnsg.llent's estimates. The Diatrict does not attempt to allocate all costs which
ben.fit the other funds due to the difficulties associated with the lIeasurell.nt
of such benefite.
3. Ca.h and investments
The District's cash and equivalents consist of cash balances deposit.d in
financial institutions and repurchase agreements purchased by the District from
the financial institutions as part of a cash management account.
C.sh at June 30, 1995 is categorized as follows:
Total
Carrying Bank
Value Balance
$ 500 $ -0.
100,000 100,000
-0- -0-
12 .466 76.373
$ 112.966 $ 176.373
Caah and eauivalents
Change funds
Insured (FDIC)
Collateral held in the District's name
Collateral not held in the District's name
For purposes of the Food Service Fund statement of cash flows, the District
considers all deposits purchased with an original maturity of three months or
les. to be cash or cash equivalents.
- 13 -
EAST PENNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd)
JUNE 30, 1995
3. Cash and investments (Cont'd.)
The types of authorized investments are limited by state regulations. The
District's investments consist of deposits in the Pennsylvania Local Government
Investment Trust. These investments are carried at cost which approximates market
value. At June 30, 1995, all investments of the Trust were either obligations of
the U.S. Gover,went or its agencies or instrumentalities, or deposits insured by
FDIC, and are categorized aa follows:
Carrying Market
Investmlmts Value Value
Insured (FDIC) $ -0- $ -0.
Collateral held in the District's name -0- -0-
Collateral not held in the District's name -0- -0-
-0- -0-
Pooled investments (PLIGIT) 1. 956.486 1.956.486
Total $ 1.956.486 $ 1.956.486
Investment policies followed during the year ended June 30, 1995 did not
significantly alter the categorization of investments shown above.
4. Accounts receivable
Accounts receivable at June 30, 1995 consist of the following:
General
Fund
Food
Service
Fund
Federal subsidies
State subsidies
Due from other governmental units
Due from EIT/OPT collector (September)
$
14,518
86,243
24,270
251. 230
$
2,976
303
$
376.261
$
3.279
5. Delinquent taxes receivable
As explained in Note 2, taxes are recorded as revenue only when received, or, in
tha case of delinquent real estate taxes, available within 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
$ 286,983 at June 30, 1995. Delinquent taxes receivable as reflected on the June
30, 1995 balance sheet consist of the following:
- 14 .
EAST PENNS80RO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
5. Delinquent taxes receivable (Cont'd.)
1989 and prior years
1990-91
1991-92
1992-93
1993-94
1994-95
$
Real
:MAl Estate Personal
73 ,438 $ .0. $ 73,438
67,833 -0. 67,833
96,034 1,871 94,163
106,149 11,691 94,458
210,077 64,130 145,947
375.442 143.218 232.224
928,973 220,910 708,063
638.382 86.376 552.006
290.591 $ 134.534 $ 156.057
Less: Allowance for
uncollectibles
Total
$
6. General Fixed Assets
As explained in Note 2, buildings and equipment are reflected on the balance
sheet under the General Fixed Assets Group of Accounts stated at historical coat
or estimated historical cost if actual historical costs are not available. A
summary of chsnges in fixad assets for the year ended June 30, 1995 is as followa:
Transfers
Beginning and End
of Year Additions DisDosals of Year
General fixed assets
Land and
improvements $ 325,856 $ .0- $ -0. $ 325,856
Buildings and
improvements 20,243,745 206,084 -0. 20,449,829
Furniture and
equipment 1. 859.109 196.463 .0- 2.055.572
$ 22.428.7l0 $ 402.547 $ -0- $ 22.831.257
. 15 -
Q
EAST PENNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
.
6. General Fixed Aseets (Cont'd.)
.
Beginning
of Year
Transfera
and
DiSDosals
End
of Y.ar
Additions
Food Service Fund
fixed a..ets
Furniture and
equipment
Accumulated
depreciation
$
182,227 $
2,295 $
-0-
$ 184,522
(165.615)
13.314)
-0-
(168.929 )
$
16.612
$
(1.019) $
-0-
$
15.593
7. G.neral obligation bonds payable
A summary of changes in general obligation bonds psyable for the year ended June
30, 1995 ia as follows:
Payments
8eginning and other End
of Year Additions Deerea.ea of Y.ar
G.neral Obligation Bonds
S.ri.. of 1992 $ 8,310,000 $ -0- $ (145,000) $ 8,165,000
S.ri.. of 1989 6.553.354 431.013(a) /815.000) 6.169.367
$ 14.863.354 $ 431.013 $ /960.000) $ 14.334.367
(a) Represents accreted interest on Capital Appreciation Bonds.
A. General Obligation Bonds, Series of 1989 . Proceeds of this
iuue were applied in part to refund the District's General
Obligation Bonds, Series of 1987, with the remainder used to
pay certain costs of the refunding program and to fund other
capital improvements to facilities owned by the District. As
part of the refunding program, funds were irrevocably deposited
into an Escrow Account. The Escrow Agent used these funds to
purchase United States Treasury Securities . State and Local
GoverlUllent Series in such amounts and maturities to satiafy
interest payments on the 1987 Bonds and retire all outstanding
1987 Bonds on the September 1, 1992 call date. The General
Obligation Bonds, Series of 1989 consist of Capital Appreciation
Bonds. Interest accreted through the March 1 payment date of
each year on the Capital Appreciation Bonds is added to the
cllrrying value.
. 16 .
EAST PENNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
7. G.neral obligation bonds payable (Cont'd.)
B. G.neral Obligation Bonds, Series of 1992 - Proceeds of thh
issue are being used to design, construct, furnish and equip
a new elementary school. The net proceeds were deposited in
the Capital Projects Fund where they are available to pay the
costs of the elementary school construction project. These
bonds, which mature annually September 1 of each year through
the year 2012, pay interest at annual rates ranging from 2.70.
to 5.80..
.
Future maturities and debt service requirements are as follows:
Series
Series of 1992 of 1989
Capital
Appreciation
luX Il!Ul PrinciDal Interest Bond. (1\
1995-96 $ 1,410,750 $ 150,000 $ 445,750 $ 815,000
1996-97 1,409,580 160,000 439,580 810,000
1997-98 1,407,630 165,000 432,630 810,000
1998-99 1,405,090 170,000 425,090 810,000
1999-2000 1,401,740 185,000 416,740 800,000
2000.2012 15.668.324 7.480.000 3.338.324 4.850.000
Totals $ 22.703.114 $ 8.310.000 $ 5.498.114 $ 8. 89S. 000
(1) Reflects final maturity value of Capital Appreciation Bonds.
8. Compensated absences
At June 30, 1995, the General Long.Term Debt Group of Accounts includes a
liability for compensated absences of $ 500,940. Payments for compensat.d
absences are made through General Fund expenditures in the year the absence is
us.d or the employee retires. When an employee retires with unused compensat.d
absences, the District's payout policy is as follows:
Emergency and personal . no payout required
Vacation (administrative personnel only) - unused vacation days
(not to exceed 5 days) are paid at the time of separation
Sickness - no payout required
P.rsonal days unused personal days (not to exceed 5 days) are
paid at a rate equal to the average rate paid to substitute
teachers
- 17 .
EAST PF.NNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
10. Pension plan
All full time District employees and part time employees with at least 80 days or
500 hours of service yearly, are eligible to participate in The Public School
Employees' Retirement System of Pennsylvania ("System"), a cost.sharing, multiple'
employer defined benefit pension plan. The payroll for the employees covered by
the plan for the year ended June 30, 1995 was $ 9,250,886: the District's total
payroll for that period was $ 9,384,772.
Employees who retire at age 62, or age 60 with 30 years of service, or with 35
years of service regardle58 of age, are encitled co a retirement benefit, payable
monthly for life, equal to 2' of their final average salary times year. of
service. Benefits vest on reaching 10 years of service. The System alao provides
for early retirement at age 55 and for death and disability benefits. Effective
July 1992, health insurance premium assistance of $ 55 per month is provided for
retirees receiving a disability benefit or credited with at least 24.5 yesrs of
service.
Covered employees are required by State statute to contribute a percentage of
their salary to the plan. This percentsge is 5.25' for employees hired bafore
July 1983, and 6.25' for employees hired after that date. The District and State
contribution percentages were equal at 5.53' for the year ended June 30, 1995.
The District's contribution for the year was $ 511,574. Employees' contribution.
for the year were $ 519,136. Effective July 1995, the District percentage will
be 11.72' and the District will receive a subsidy from the State for a portion of
the District contribution.
The pension benefit obligacion, which is the accuarial present value of eredit.d
projected benefits, is ~ standardized measure of the present value of pension
benefits, adjusted for the effects of projected salary increases and any step-
rate benefits, estimated to be payable in the future as a result of employee
service to date. The measure is intended to help users assess the retirement
aystem's funding status on a going-concern basta, assess progre.s made in
accumulating sufficient assets to pay benefits when due, and make compariaons
among public employe retirement systems. As of June 30, 1994, the most recent
actuarial valuation date, the System's pension benefit obligation, as calculated
in accordance with GASB Statement No.5, totalled $ 26.3 billion. Net assets
available for benefits as of the same date totalled $ 23.5 billion. The unfunded
pension obligation under GASB Statement No. 5 totalled $ 2.8 billion.
Total contributions to the System from all participating employers for the years
ended June 30, 1995 and 1994 were $ 809 million (estimated) and $ 927 million,
respectively.
Ten-year historical trend information showing the syst~m's progress in
accumulating sufficient assets to pay benefits when due is presented in the
System's Comprehensive Annual Financial Report.
.
.
.,;
. 19 -
'"
EAST PENNSBORO AREA SCHOOL DISTRICT
NOTES TO FINANCIAL STATEMENTS (Cont'd.)
JUNE 30, 1995
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 operation and
maintenance of food services as required by law, with the policies subject to the
approval of the District. Operating costs, management fees and administrative
costs are billed monthly to che District.
12. Other post. employment retirement benefits
The District offers one post-employment benefit to retired professional employees
other than pension benefits as discussed in Note 9. For employees with twenty
or more years of service to the District, the District will pay the basic medical
inaurance premiums for five years (excluding family coverage) following
retirement. This benefit amounted to approximately $ 33,000 during the year
ended June 30, 1995 and covered 18 eligible retired employees. The District does
allow other employees not eligible for this benefit to remain in its group medical
insurance plan upon payment by the retired employee of the cost of such coverage.
13. Risk management
The District is exposed to various risks of loss related to torts; theft of,
damage to, and destruction of assets; errors and omissions; injuries to employe.s;
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 uninsured losses to the Diatrict. Settled
claims have not exceeded this commercial coverage in any of the past three fiscal
years.
For purposes of State unemployment compensation laws, the 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 Districts who have joined together
to self. 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. Claims in excess of the District's retention
experience are paid by a Central Fund within the group and, if necessary, by an
insurance company cerrying excess liability coverage.
14. Commitments and contingencies
The collective bargaining agreem~nt between the District and the teaching staff
expires on August 31, 1996.
The General Fund balance sheet does not reflect materials and suppliea received
but not paid for prior to June 30, 1995 whleh are budgeted for the year 1995-96.
. 20 .
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