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NORFOLK STATE UNIVERSITY

NORFOLK STATE UNIVERSITY. OPENING SESSION AUGUST 16, 2004 DIVISION OF FINANCE AND BUSINESS. OPENING SESSION FINANCE AND BUSINESS. ORGANIZATIONAL CHANGES SACS FINANCIAL MANAGEMENT OVERVIEW SIGNIFICANT ACCOMPLISHMENTS CURRENT ISSUES FUTURE GOALS CAPITAL UPDATE CONCLUSION.

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NORFOLK STATE UNIVERSITY

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  1. NORFOLK STATE UNIVERSITY OPENING SESSION AUGUST 16, 2004 DIVISION OF FINANCE AND BUSINESS

  2. OPENING SESSIONFINANCE AND BUSINESS • ORGANIZATIONAL CHANGES • SACS FINANCIAL MANAGEMENT OVERVIEW • SIGNIFICANT ACCOMPLISHMENTS • CURRENT ISSUES • FUTURE GOALS • CAPITAL UPDATE • CONCLUSION

  3. ORGANIZATIONAL CHANGES • Facilities Management • Operations and Maintenance • Capital Planning and Improvements • Materiel Management • Police Department • Parking and Transportation • Auxiliary Services

  4. SACS Principles of Accreditation Overview of Financial Management Issues

  5. SACS Financial Management Overview Outline • Review of Principles of Accreditation • Core Requirement number 11 • Audit Management Issues • Audited Financial Statements • Management Letters • Footnotes • Financial Issues • Balance Sheets • Statement of Activities/ Budgeting • Key Management Issues • What questions should you be asking? • Early warning signs • Summary

  6. Core Requirement Number 11 The institution has a sound financial base and demonstrated financial stability, and adequate physical resources to support the mission of the institution and the scope of the programs and services. SACS Financial Management Overview

  7. SACS Financial Management Issues The following financial statements are required: • Institutional Audit • Annual Budget that is preceded by sound planning • Statement of Activities (Revenues, Expenses, and Changes in Net Assets) • Statement of Net Assets (Balance Sheet) • Statement of Cash Flows • A Statement of Financial Position that Excludes plant and plant related debt

  8. SACS Financial Management Overview Audit Management Issues • Most Recent Fiscal Year (June 30, 2007) • Written Management Letter • Accompanies Audit • Required even if no issues exist • Footnotes • Prior year adjustments • Contingent Liabilities • Going Concern Comment

  9. SACS Financial Management Overview Audit Management Issues A-133 Audits • Compliance (Federal, State, Local, Institutional) • Internal Control • Schedule of Expenditures of Federal Awards • Summary of Auditors Results

  10. SACS Financial Management Overview Financial Management Issues • Balance Sheet Analysis • Cash • Accounts Receivable • Property Plant & Equipment • Prove ongoing maintenance • Accounts Payable

  11. SACS Financial Management Overview Balance Sheet Analysis • Endowment • Policy and Guidelines • Spending Rate • Borrowing • What is in the Endowment? • Real Estate • Other Non-Liquid Assets • Debt Management • Policy • Covenants

  12. SACS Financial Management Overview Statement of Activities • Tuition Discounting • Cash Flow Budgeting • Preceded by Sound Planning • Relationship to Actual • Approved by Board of Trustees • Sufficient Financial Resources

  13. SACS Financial Management Overview Key Management Issues • Understanding Ratio Analysis • Analyzing your Institution

  14. SACS Financial Management Overview Key Management Issues Early Warning Signs Audit • Prior year adjustments • A-133 Compliance (Grants) • No clear audit opinion • Lawsuits, especially vendor • Material findings

  15. SACS Financial Management Overview Key Management Issues (continued) Early Warning Signs Balance Sheet • Accounts Receivable • Endowment borrowings • Endowment used as collateral • Large unpaid pledges • Cash Shortfalls • Deficit in unrestricted net assets

  16. SACS Financial Management Overview Key Management Issues (continued) Early Warning Signs Statement of Activities • Operating deficits • Revenue distribution • Expense growth • Tuition discounting Others • Deferred Maintenance • Unpaid Payroll taxes • Financial officer turnover • Backlog in retirement payment obligations

  17. SACS Financial Management OverviewSummary • Get ready now! • Analyze your Institution • Ratio analysis • Review Early Warning Signs • Develop long-term plans to address problems • Accounts Receivable • Deferred Maintenance

  18. SACS Financial Management OverviewSummary • SACS evaluates the quality of the institution • Many characteristics of quality institutions • Some visible, some less visible • Outside observer may not easily see all characteristics • Visible aspects • Can see when grass is cut • Can see if roof leaks • Can see if restrooms are clean

  19. SACS Financial Management OverviewSummary • Norfolk State University must invest in the maintenance, improvement, and expansion of physical facilities to survive and thrive as a quality educational institution and to be assured of SACS reaccreditation

  20. SACS Financial Management OverviewSummary • Common fiscal and operational characteristics of model higher education institutions • Financial stability • collect tuition and fees • Invest in physical facilities • Strive for operational efficiency

  21. FINANCE AND BUSINESS PRIORITIES AND GOALS • Service Oriented Attitude • Operational Efficiency and Effectiveness • Financial Accountability

  22. FINANCE AND BUSINESSSignificant Accomplishments • Met all management standards for the institutions of higher education in Virginia for 2003-2004 • Unqualified Audit Opinion • No significant audit deficiencies • Compliance with financial reporting standards • Accounts payable standard (prompt pay) • Accounts Receivable standards (student financial aid) • Accounts receivable standards (past due accounts) • First time ever for NSU

  23. SIGNIFICANT ACCOMPLISHMENTS • Reorganized Human Resources staff and functions to improve service to campus community • Developed comprehensive background check policy for hiring of faculty and staff • Implemented identification badge policy to improve campus safety • Completed IFAS migration to Insight • User friendly interface to financial system • Completed upgrade to Colleague Release 17 • Improved functionality for student information system

  24. SIGNIFICANT ACCOMPLISHMENTS • Completed master plan for the NSU campus and RISE Center • Replaced roof on east wing of library • Enhanced E. L. Hamn Building (Art & Music) to include painting, lighting, electrical, carpentry and lock repairs • Implemented turf grass maintenance program to promote green and healthy grass • Developed specifications for new gatehouses at all major entrances

  25. SIGNIFICANT ACCOMPLISHMENTS • Refurbished the Women’s Restroom in Brown Hall to include painting, counter top, upgraded lighting, automatic flush valves and automatic sensor faucets • Initiated comprehensive landscaping and planting to restore and beautify the Mall / Greek Row area • Executed and implemented first phase of comprehensive energy savings program. • Improved mechanical systems, lighting and fixtures, counter tops, toilets, flush valves throughout various campus buildings

  26. CURRENT ISSUES • PAYMENT OF TUITION AND FEES • Basic business principles • Cannot spend what you charge but only what you collect • Cannot provide goods and services without compensation • Don’t send the delivery man without approved payment terms • Faculty deliver primary product – academic instruction • Housing • Meals • DIRECT DEPOSIT AND PAYLINE • Operational Efficiency • Convenience • Access • State initiative to charge agencies for check / stub production

  27. TUITION AND FEES • Prior Balances must be paid before registration for subsequent semesters will be permitted. • Satisfactory financial arrangements must be in place to meet costs of attendance for current semester.

  28. TUITION AND FEESFORMS OF PAYMENT • Cash, check, credit card (visa, master card, discover) or money order • May require certified funds • Approved financial aid, scholarships, private loans, or third party sponsorships • Approved installment payment plan

  29. TUITION AND FEES PAYMENT PLANS • Academic Management Services (AMS) monthly payment plan. Monthly payments may be arranged for the academic year or for the semester. (If interested in this plan, contact AMS at 1 800 635 0120). • NSU offers a semester payment plan that requires 50% of the balance at the time the plan is set up and a $50 application fee. (Students interested in a payment plan may find the AMS plan more flexible).

  30. TUITION AND FEES CANCELLATION OF SERVICES Students who do not pay balances in full or make satisfactory financial arrangements will have their classes and other services (housing, meals, etc.) canceled.

  31. TUITION AND FEES KEY DATES • Returning Students • August 20, 2004 - Satisfactory financial arrangements must be in place or classes and services will be canceled. • September 3, 2004 - Last date to complete satisfactory financial arrangements to have services restored.

  32. TUITION AND FEES KEY DATES • New Freshmen and Transfer Students - August 25, 2004 - Satisfactory financial arrangements must be in place or classes and services will be canceled. • September 3, 2004 - Last date to complete satisfactory financial arrangements to have services restored.

  33. DIRECT DEPOSIT AND PAYLINE • Effective September 1, 2004 • Required to receive pay through direct deposit account • No pay checks or stubs after September 1, 2004 • All pay information viewed through State’s electronic Payline • http://payline.doa.state.va.us • Information available 4 days prior to payday • Sign up before August 24, 2004 • Automatic enrollment after that date • Submit banking information to payroll office • Room 360B Wilson Hall • CashPay® option available for those without bank accounts

  34. DIRECT DEPOSIT AND PAYLINECashPay® • A Visa®-branded card that allows you to make purchases everywhere Visa is accepted, and to withdraw cash at ATM’s worldwide • Your pay is automatically deposited into your account by 9 a.m. on payday • Instant access to your pay at Visa merchants, pinned POS locations and ATMs • Eliminates high check-cashing fees and no more lines to wait in to cash your paycheck • No requirements to withdraw entire paycheck at one time • Automated account information and customer service 24 hours a day, 7 days a week • For questions, contact Human Resources (823-8160 or Payroll (823-2946)

  35. CAPITAL PROJECTS UPDATE Teacher’s Education Renovation -Complete renovation of the entire interior of building including all mechanical, electrical, plumbing, safety systems and finishes. Substantial completion (occupation) December 7, 2004 Final completion (30 days to complete punch list) January 7, 2005

  36. CAPITAL PROJECTS UPDATE Phase I Robinson Technology Renovation (Optical Engineering Lab only) - The project consists of renovation of the existing metal shop, removal of all interior fixtures and the construction of engineering lab and/or research spaces Substantial completion (occupation) September14,2004 Final completion October 14, 2004

  37. CAPITAL PROJECTS UPDATE Robinson Technology Renovation Phase II- This project includes removing all interior spaces and systems, for complete redesign of the entire building to meet accreditation requirements. Receive Bid approval form BCOM Sept 16, 2004 Advertise for Bids Oct 20, 2004 Receive Bids Nov 20, 2004 Open Bids Nov 21, 2004 Award Bid/ Notice to proceed Dec 12, 2004 Substantial Completion Dec 28, 2005

  38. CAPITAL PROJECTS UPDATE Student Center Renovation and Addition - This project will add approximately 70,800 square feet to the south of the existing Godwin Center. The addition will add several multipurpose spaces, basketball courts, eateries, and a new fitness center. Also included in this project is the total renovation of the existing building, including mechanical systems, electrical, and plumbing. Presently in preplanning and preliminary design stage.

  39. CAPITAL PROJECTS UPDATE Woods Science Roof Replacement -Total replacement of the Roof is necessary. Several repairs have been completed in the past but still there are various leaks that must be addressed. Advertise for bid September 2004 Award contract/ Notice to proceed October 2004 Substantial completion January 2005

  40. CAPITAL PROJECTS UPDATE Norfolk Community Hospital -This facility consists of 135,000 square feet of space, much of which is need of renovations. Some areas have been recently renovated. The building can be used to meet an immediate need for transitional space as we effect planned improvements to other campus buildings. Anticipated acquisition in August 2004

  41. CAPITAL PROJECTS UPDATE RISE Center Phase I - The RISE Center is an academic and technology support facility that will improve instructional and research capabilities related to science and technology. Advertise for Construction Manager @ Risk July 15, 2004 CM @ Risk firm selected October 15, 2004 Construction begins December 2004 Construction Completion January 2006

  42. CONCLUSION

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