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CLARION UNIVERSITY
FINANCIAL UPDATE AND
FY 2016 BUDGET REVIEW
COUNCIL OF TRUSTEES
SEPTEMBER 17, 2015
1
OVERVIEW
•
•
•
•
•
Revenue & Expenses FY09 to FY16
Enrollment FY12 to FY17
FY15 Budget to Actual
FY16 Budget
•
E&G
•
Restricted/Endowment
•
Auxiliary
•
Total
Conclusion
2
3
4
CLARION UNIVERSITY FY 2015 Budget to Actual (unaudited)
Statement of Revenues, Expenses, and Change in Net Position
Clarion University of PA
Statement of Revenues, Expenses, and Change in Net Position
FY 2014/15 Actual
Revenues
Operating Revenues:
Net tuition and fees
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Other revenues
Total Operating Revenues
FY 2014/15 COT Budget
Fav/(Unfav)
Variance
38,550,357
10,511,573
3,481,848
12,650,834
264,582
65,459,194
40,296,883
10,367,356
2,013,293
13,031,430
223,500
65,932,462
(1,746,526)
144,217
1,468,555
(380,596)
41,082
(473,268)
Expenses
Operating Expenses:
Personnel compensation
Compensated absences & postretirement
All other expenses
Total Operating Expenses
68,617,422
5,048,147
34,839,560
108,505,129
71,035,369
5,338,180
33,234,951
109,608,500
2,417,947
290,033
(1,604,609)
1,103,371
Net Operating Revenues (Expenses)
(43,045,935)
(43,676,038)
(630,103)
23,235,384
8,265,141
423,820
1,181,926
(561,824)
45,102
32,589,549
23,007,209
8,245,000
425,000
892,647
(585,445)
56,000
32,040,411
228,175
20,141
(1,180)
289,279
(23,621)
(10,898)
549,138
(10,456,386)
(11,635,627)
Nonoperating Revenues (Expenses)
State appropriations, general and restricted
Pell grants
Investment income, net of related investment expense
Gifts for other than capital purposes
Interest expense on capital asset-related debt
Other nonoperating revenue (expense)
Net Nonoperating Revenues (Expenses)
Income (Loss) Before Other Revenues, Expenses, Gains or Losses
State appropriations, capital
Capital gifts and grants
Total Other Revenues
Increase (Decrease) in Net Position
774,658
257,440
1,032,098
(9,424,288)
774,000
250,000
1,024,000
(10,611,627)
1,179,241
658
7,440
8,098
1,187,339
5
CLARION UNIVERSITY FY 2015 Budget to Actual (unaudited)
Statement of Revenues, Expenses, and Change in Net Position
•
•
The final audited FY15 financial statements will reflect an accounting change related to when
revenue is recognized by the Northwest Aids Alliance. Previously, we recorded the annual
excess revenue over expenses as deferred revenue. Our auditors, CliftonLarsonAllen, have
determined that GASB requires that excess revenue should be recorded as income in the year it
is received. Therefore, a cumulative adjustment of approximately $3.1 million was made in FY
15. The adjustment will reduce the total decrease in net position on the final audited financial
statements to $6.4 million from the $9.4 million shown on the previous slide. These funds are
restricted for the sole use of the Northwest Aids Alliance program and will be spent and shown
as expense at that time.
The overall decrease in net position, prior to the year end adjustment, was approximately $1.2
million dollars favorable to the budget of $10.6 million. This variance is primarily due to
favorable compensation expense variance of approximately $2.4 million offset by unfavorable
variances in all other expenses of $1.6 million. This unfavorable variance is primarily due to bad
debt expense of $.5 million and CCN supply costs for pharmacy services of approximately $1.1
million (the $1.4 million favorable variance in sales and services revenue represents the
additional funding source for these expenditures).
6
CLARION UNIVERSITY FY 2016 Education & General Budget
Clarion University of PA
FY15 Actual
Revenues:
Net tuition and fees
State appropriations
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Gifts
Investment income
Other revenues
Use of prior year carryforward
FY16 Budget
$ Vari 15 Act-16
Bud
49,013,874
23,235,384
476,156
3,081,798
65,000
42,341
215,360
346,809
0
47,061,123
24,247,937
332,598
2,462,156
65,000
0
85,000
402,653
130,621
(1,952,751)
1,012,553
(143,558)
(619,642)
(42,341)
(130,360)
55,844
130,621
76,476,722
74,787,088
(1,689,634)
62,035,560
21,588,076
63,745,640
19,861,674
(1,710,080)
1,726,402
Total Expenditures and Transfers
83,623,636
83,607,314
16,322
Revenues less Expenditures and Transfers (excluding
in Excess of Pay-as-you-go adjustments)
(7,146,914)
(8,820,226)
(1,673,312)
Total Revenues
Expenditures:
Personnel compensation
All other expenses
7
CLARION UNIVERSITY FY 2016 Education & General Budget - NOTES
•
•
•
•
•
FY 2016 budgeted net tuition and fee revenue is down approximately $2 million, or 4%,
from FY 2015 due to the projected decline in enrollment of roughly 7.5%, offset by the 3.5%
tuition increase.
FY 2016 budgeted state appropriation is up approximately $1 million, or 4%, from FY 2015
due to the anticipated 3.5% increase in funding and favorable results from the appropriation
reallocation formula. The Governor’s request in March, 2015 would have yielded an
increase of approximately $2.7 million.
FY 2016 budgeted sales and services revenue is down approximately $.6 million, or 20%,
from FY 2015 due to potential declines in the Northwest Aids Alliance unrestricted
pharmacy funding.
FY 2016 budgeted personnel compensation is up approximately $1.7 million, or 3%, from FY
2015. Benefit costs amount to approximately $2.1 million of this variance offset by savings
in salaries and wages of $.4 million.
FY 2016 budgeted all other expenses are down approximately $1.7 million, or 8%. This
decrease is related to a transfer made during FY 2015 of $2.1 million from E&G to the Plant
Fund to fund the required E&G portion of the Becht Hall project which will not recur in FY
2016. This savings is offset by an increase of approximately $.4 million in student aid
expense for E&G sourced scholarships.
8
CLARION UNIVERSITY FY 2016 Restricted/Endowment Budget
Clarion University of PA
FY15 Actual
Revenues:
Net tuition and fees
State appropriations
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Gifts
Investment income
Other revenues
Use of prior year carryforward
$ Vari 15 Act-16
Bud
FY16 Budget
(10,463,517)
0
18,300,558
3,413,975
0
1,139,585
25,313
23,924
0
(10,500,000)
0
17,659,761
100,000
0
1,000,000
21,500
7,000
0
(36,483)
(640,797)
(3,313,975)
(139,585)
(3,813)
(16,924)
-
12,439,838
8,288,261
(4,151,577)
3,337,499
6,066,588
3,114,102
5,174,159
223,397
892,429
Total Expenditures and Transfers
9,404,087
8,288,261
1,115,826
Revenues less Expenditures and Transfers (excluding
in Excess of Pay-as-you-go adjustments)
3,035,751
0
(3,035,751)
Total Revenues
Expenditures:
Personnel compensation
All other expenses
9
CLARION UNIVERSITY FY 2016 Restricted/Endowment Budget-NOTES
• FY 2016 budgeted grants and contracts revenue is down approximately $.6
million, or 3.5%, from FY 2015 due to anticipated reductions in the PELL and
PHEAA programs due to the expected decreased enrollment.
• FY 2016 budgeted sales and services revenue is down approximately $3.3
million, or 97%, from FY 2015 primarily due to the adjustment made in FY
2015 to record pharmacy revenue that in prior years had been deferred.
• FY 2016 budgeted all other expenses are down approximately $.9 million, or
15%, from FY 2015 due to reductions in student aid expense resulting from
the anticipated reductions in the PELL and PHEAA programs.
10
CLARION UNIVERSITY FY 2016 Auxiliary Budget
Clarion University of PA
FY15 Actual
Revenues:
Net tuition and fees
State appropriations
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Gifts
Investment income
Other revenues
Use of prior year carryforward
$ Vari 15 Act-16
Bud
FY16 Budget
0
0
0
0
12,526,552
0
33,235
0
0
0
0
0
0
12,404,035
0
27,800
0
0
(122,517)
(5,435)
-
12,559,787
12,431,835
(127,952)
3,244,363
10,546,721
3,223,823
9,208,012
20,540
1,338,709
Total Expenditures and Transfers
13,791,084
12,431,835
1,359,249
Revenues less Expenditures and Transfers (excluding
in Excess of Pay-as-you-go adjustments)
(1,231,297)
0
1,231,297
Total Revenues
Expenditures:
Personnel compensation
All other expenses
11
CLARION UNIVERSITY FY 2016 Total Budget
Clarion University of PA
FY15 Actual
Revenues:
Net tuition and fees
State appropriations
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Gifts
Investment income
Other revenues
Use of prior year carryforward
FY16 Budget
$ Vari 15 Act-16
Bud
38,550,357
23,235,384
18,776,714
6,495,773
12,591,552
1,181,926
273,908
370,733
0
36,561,123
24,247,937
17,992,359
2,562,156
12,469,035
1,000,000
134,300
409,653
130,621
(1,989,234)
1,012,553
(784,355)
(3,933,617)
(122,517)
(181,926)
(139,608)
38,920
130,621
101,476,347
95,507,184
(5,969,163)
68,617,422
38,201,385
70,083,565
34,243,845
(1,466,143)
3,957,540
Total Expenditures and Transfers
106,818,807
104,327,410
2,491,397
Revenues less Expenditures and Transfers (excluding
in Excess of Pay-as-you-go adjustments)
(5,342,460)
(8,820,226)
(3,477,766)
Total Revenues
Expenditures:
Personnel compensation
All other expenses
12
CONCLUSION
• FY15 results were better than budget by almost $1.2 million
• Going forward we will use the budget report as our budget
• Excludes compensated absences and post retirement benefits
• Consistent with how all other PASSHE schools show their budget
• The increase in the FY16 budget deficit is driven by our decrease in
enrollment; expenses are flat on a year-over-year basis
• At the Council of Trustees meeting we will be asking you to approve the
budget.
13
13
FINANCIAL UPDATE AND
FY 2016 BUDGET REVIEW
COUNCIL OF TRUSTEES
SEPTEMBER 17, 2015
1
OVERVIEW
•
•
•
•
•
Revenue & Expenses FY09 to FY16
Enrollment FY12 to FY17
FY15 Budget to Actual
FY16 Budget
•
E&G
•
Restricted/Endowment
•
Auxiliary
•
Total
Conclusion
2
3
4
CLARION UNIVERSITY FY 2015 Budget to Actual (unaudited)
Statement of Revenues, Expenses, and Change in Net Position
Clarion University of PA
Statement of Revenues, Expenses, and Change in Net Position
FY 2014/15 Actual
Revenues
Operating Revenues:
Net tuition and fees
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Other revenues
Total Operating Revenues
FY 2014/15 COT Budget
Fav/(Unfav)
Variance
38,550,357
10,511,573
3,481,848
12,650,834
264,582
65,459,194
40,296,883
10,367,356
2,013,293
13,031,430
223,500
65,932,462
(1,746,526)
144,217
1,468,555
(380,596)
41,082
(473,268)
Expenses
Operating Expenses:
Personnel compensation
Compensated absences & postretirement
All other expenses
Total Operating Expenses
68,617,422
5,048,147
34,839,560
108,505,129
71,035,369
5,338,180
33,234,951
109,608,500
2,417,947
290,033
(1,604,609)
1,103,371
Net Operating Revenues (Expenses)
(43,045,935)
(43,676,038)
(630,103)
23,235,384
8,265,141
423,820
1,181,926
(561,824)
45,102
32,589,549
23,007,209
8,245,000
425,000
892,647
(585,445)
56,000
32,040,411
228,175
20,141
(1,180)
289,279
(23,621)
(10,898)
549,138
(10,456,386)
(11,635,627)
Nonoperating Revenues (Expenses)
State appropriations, general and restricted
Pell grants
Investment income, net of related investment expense
Gifts for other than capital purposes
Interest expense on capital asset-related debt
Other nonoperating revenue (expense)
Net Nonoperating Revenues (Expenses)
Income (Loss) Before Other Revenues, Expenses, Gains or Losses
State appropriations, capital
Capital gifts and grants
Total Other Revenues
Increase (Decrease) in Net Position
774,658
257,440
1,032,098
(9,424,288)
774,000
250,000
1,024,000
(10,611,627)
1,179,241
658
7,440
8,098
1,187,339
5
CLARION UNIVERSITY FY 2015 Budget to Actual (unaudited)
Statement of Revenues, Expenses, and Change in Net Position
•
•
The final audited FY15 financial statements will reflect an accounting change related to when
revenue is recognized by the Northwest Aids Alliance. Previously, we recorded the annual
excess revenue over expenses as deferred revenue. Our auditors, CliftonLarsonAllen, have
determined that GASB requires that excess revenue should be recorded as income in the year it
is received. Therefore, a cumulative adjustment of approximately $3.1 million was made in FY
15. The adjustment will reduce the total decrease in net position on the final audited financial
statements to $6.4 million from the $9.4 million shown on the previous slide. These funds are
restricted for the sole use of the Northwest Aids Alliance program and will be spent and shown
as expense at that time.
The overall decrease in net position, prior to the year end adjustment, was approximately $1.2
million dollars favorable to the budget of $10.6 million. This variance is primarily due to
favorable compensation expense variance of approximately $2.4 million offset by unfavorable
variances in all other expenses of $1.6 million. This unfavorable variance is primarily due to bad
debt expense of $.5 million and CCN supply costs for pharmacy services of approximately $1.1
million (the $1.4 million favorable variance in sales and services revenue represents the
additional funding source for these expenditures).
6
CLARION UNIVERSITY FY 2016 Education & General Budget
Clarion University of PA
FY15 Actual
Revenues:
Net tuition and fees
State appropriations
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Gifts
Investment income
Other revenues
Use of prior year carryforward
FY16 Budget
$ Vari 15 Act-16
Bud
49,013,874
23,235,384
476,156
3,081,798
65,000
42,341
215,360
346,809
0
47,061,123
24,247,937
332,598
2,462,156
65,000
0
85,000
402,653
130,621
(1,952,751)
1,012,553
(143,558)
(619,642)
(42,341)
(130,360)
55,844
130,621
76,476,722
74,787,088
(1,689,634)
62,035,560
21,588,076
63,745,640
19,861,674
(1,710,080)
1,726,402
Total Expenditures and Transfers
83,623,636
83,607,314
16,322
Revenues less Expenditures and Transfers (excluding
in Excess of Pay-as-you-go adjustments)
(7,146,914)
(8,820,226)
(1,673,312)
Total Revenues
Expenditures:
Personnel compensation
All other expenses
7
CLARION UNIVERSITY FY 2016 Education & General Budget - NOTES
•
•
•
•
•
FY 2016 budgeted net tuition and fee revenue is down approximately $2 million, or 4%,
from FY 2015 due to the projected decline in enrollment of roughly 7.5%, offset by the 3.5%
tuition increase.
FY 2016 budgeted state appropriation is up approximately $1 million, or 4%, from FY 2015
due to the anticipated 3.5% increase in funding and favorable results from the appropriation
reallocation formula. The Governor’s request in March, 2015 would have yielded an
increase of approximately $2.7 million.
FY 2016 budgeted sales and services revenue is down approximately $.6 million, or 20%,
from FY 2015 due to potential declines in the Northwest Aids Alliance unrestricted
pharmacy funding.
FY 2016 budgeted personnel compensation is up approximately $1.7 million, or 3%, from FY
2015. Benefit costs amount to approximately $2.1 million of this variance offset by savings
in salaries and wages of $.4 million.
FY 2016 budgeted all other expenses are down approximately $1.7 million, or 8%. This
decrease is related to a transfer made during FY 2015 of $2.1 million from E&G to the Plant
Fund to fund the required E&G portion of the Becht Hall project which will not recur in FY
2016. This savings is offset by an increase of approximately $.4 million in student aid
expense for E&G sourced scholarships.
8
CLARION UNIVERSITY FY 2016 Restricted/Endowment Budget
Clarion University of PA
FY15 Actual
Revenues:
Net tuition and fees
State appropriations
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Gifts
Investment income
Other revenues
Use of prior year carryforward
$ Vari 15 Act-16
Bud
FY16 Budget
(10,463,517)
0
18,300,558
3,413,975
0
1,139,585
25,313
23,924
0
(10,500,000)
0
17,659,761
100,000
0
1,000,000
21,500
7,000
0
(36,483)
(640,797)
(3,313,975)
(139,585)
(3,813)
(16,924)
-
12,439,838
8,288,261
(4,151,577)
3,337,499
6,066,588
3,114,102
5,174,159
223,397
892,429
Total Expenditures and Transfers
9,404,087
8,288,261
1,115,826
Revenues less Expenditures and Transfers (excluding
in Excess of Pay-as-you-go adjustments)
3,035,751
0
(3,035,751)
Total Revenues
Expenditures:
Personnel compensation
All other expenses
9
CLARION UNIVERSITY FY 2016 Restricted/Endowment Budget-NOTES
• FY 2016 budgeted grants and contracts revenue is down approximately $.6
million, or 3.5%, from FY 2015 due to anticipated reductions in the PELL and
PHEAA programs due to the expected decreased enrollment.
• FY 2016 budgeted sales and services revenue is down approximately $3.3
million, or 97%, from FY 2015 primarily due to the adjustment made in FY
2015 to record pharmacy revenue that in prior years had been deferred.
• FY 2016 budgeted all other expenses are down approximately $.9 million, or
15%, from FY 2015 due to reductions in student aid expense resulting from
the anticipated reductions in the PELL and PHEAA programs.
10
CLARION UNIVERSITY FY 2016 Auxiliary Budget
Clarion University of PA
FY15 Actual
Revenues:
Net tuition and fees
State appropriations
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Gifts
Investment income
Other revenues
Use of prior year carryforward
$ Vari 15 Act-16
Bud
FY16 Budget
0
0
0
0
12,526,552
0
33,235
0
0
0
0
0
0
12,404,035
0
27,800
0
0
(122,517)
(5,435)
-
12,559,787
12,431,835
(127,952)
3,244,363
10,546,721
3,223,823
9,208,012
20,540
1,338,709
Total Expenditures and Transfers
13,791,084
12,431,835
1,359,249
Revenues less Expenditures and Transfers (excluding
in Excess of Pay-as-you-go adjustments)
(1,231,297)
0
1,231,297
Total Revenues
Expenditures:
Personnel compensation
All other expenses
11
CLARION UNIVERSITY FY 2016 Total Budget
Clarion University of PA
FY15 Actual
Revenues:
Net tuition and fees
State appropriations
Grants and contracts
Sales and services
Auxiliary enterprises, net of discounts
Gifts
Investment income
Other revenues
Use of prior year carryforward
FY16 Budget
$ Vari 15 Act-16
Bud
38,550,357
23,235,384
18,776,714
6,495,773
12,591,552
1,181,926
273,908
370,733
0
36,561,123
24,247,937
17,992,359
2,562,156
12,469,035
1,000,000
134,300
409,653
130,621
(1,989,234)
1,012,553
(784,355)
(3,933,617)
(122,517)
(181,926)
(139,608)
38,920
130,621
101,476,347
95,507,184
(5,969,163)
68,617,422
38,201,385
70,083,565
34,243,845
(1,466,143)
3,957,540
Total Expenditures and Transfers
106,818,807
104,327,410
2,491,397
Revenues less Expenditures and Transfers (excluding
in Excess of Pay-as-you-go adjustments)
(5,342,460)
(8,820,226)
(3,477,766)
Total Revenues
Expenditures:
Personnel compensation
All other expenses
12
CONCLUSION
• FY15 results were better than budget by almost $1.2 million
• Going forward we will use the budget report as our budget
• Excludes compensated absences and post retirement benefits
• Consistent with how all other PASSHE schools show their budget
• The increase in the FY16 budget deficit is driven by our decrease in
enrollment; expenses are flat on a year-over-year basis
• At the Council of Trustees meeting we will be asking you to approve the
budget.
13
13