The following document was not prepared by the Office of the State

The following document was not prepared by the Office of the State Auditor, but was
prepared by and submitted to the Office of the State Auditor by a private CPA firm. The
document was placed on this web page as it was submitted. The Office of the State
Auditor assumes no responsibility for its content or for any errors located in the
document. Any questions of accuracy or authenticity concerning this document should
be submitted to the CPA firm that prepared the document. The name and address of the
CPA firm appears in the document.
Mississippi Gulf Coast Community College Financial Statements and Supplementary Information Year Ended June 30, 2012 Mississippi Gulf Coast Community College Financial Statements and Supplementary Information June 30, 2012
Table of Contents
Independent Auditor's Report on the Basic Financial Statements and Supplemental Information .................................................. .
1-2 Management's Discussion and Analysis '" ........................................................................ .
3-13 Audited Financial Statements
Statement of Net Assets ........... .... ...................................................................................... .
Statement of Revenues, Expenses, and Changes in Net Assets ......................................... .
Statement of Cash Flows ........................ ........................................................... ................ .
Notes to Financial Statements ................................................ ........................................... ..
14 15 16-17 18-30 Supplemental Information
Schedule of Expenditures of Federal Awards .................................................................... .
31-33 Reports on Compliance and Internal Control
Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ................................... .................................................. .
Independent Auditor's Report on Compliance with Requirements That Could Have a Direct and Material Effect on Each Major Program and on Internal Control over Compliance in Accordance with OMB Circular A-I33 ...................................................................... .
36-37 Independent Auditor's Report on Compliance with State Laws and Regulations .. ......................................... ..................................................................... .
38-39 Schedule of Findings and Questioned Costs ..................................................................... .
40-41 Schedule of Prior Year Audit Findings............................................................................ ..
42 34-35 CULUMBER, HARVEY
& ASSOCIATES, P.A.
Certified Public Accountants and Consultants
Independent Auditor's Report on the Basic Financial Statements and Supplemental Information Dr. Mary Graham, President
and Board of Trustees
Mississippi Gulf Coast Community College
Perkinston, Mississippi
We have audited the accompanying financial statements of Mississippi Gulf Coast Community
College as of and for the year ended June 30, 2012, as listed in the table of contents. We have
also audited the statement of net assets of the Mississippi Gulf Coast Community College
Foundation, Inc., a discretely presented component unit of Mississippi Gulf Coast Community
College, as of June 30, 2012 and the related statement of revenues, expenses and changes in net
assets for the year then ended. These financial statements are the responsibility of Mississippi
Gulf Coast Community College's management. Our responsibility is to express an opinion on
these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States. The financial
statements of Mississippi Gulf Coast Community College Foundation, Inc., a discretely
presented component unit, were not audited in accordance with Government Auditing Standards.
Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects,
the financial position of Mississippi Gulf Coast Community College and its discretely presented
component unit as of June 30, 2012 and the respective changes in financial position and cash
flows thereof for the year then ended in conformity with accounting principles generally
accepted in the United States of America.
2
In accordance with Government Auditing Standards, we have also issued our report dated,
December 14, 2012, on our consideration of Mississippi Gulf Coast Community College's
internal control over financial reporting and our tests of its compliance with certain provisions of
laws, regulations, contracts, and grant agreements and other matters. The purpose of that report
is to describe the scope or our testing of internal control over financial reporting and compliance
and the results of reporting on compliance. That report is an integral part of an audit performed
in accordance with Government Auditing Standards and should be considered in assessing the
results of our audit.
The Management's Discussion and Analysis on pages 3 through 13, is not a required part of the
basic financial statements but is supplementary information required by the Governmental
Accounting Standards Board. We have applied certain limited procedures, which consisted
principally of inquiries of management regarding the methods of measurement and presentation
of the required supplementary information. However, we did not audit the infonnation and
express no opinion on it.
Our audit was conducted for the purpose of forming opinions on the fmancial statements that
collectively comprise the Mississippi Gulf Coast Community College's basic financial
statements. The accompanying Schedule of Expenditures of Federal Awards is presented for
purposes of additional analysis as required by U.S. Office of Management and Budget Circular
A-133, Audits ofStates, Local Governments, and Non-Profit Organizations, and is not a required
part of the basic financial statements and, in our opinion is fairly stated, in all material respects,
in relation to the basic financial statements taken as a whole.
Culumber, Harvey & Associates, P.A.
December 14,2012
3
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30, 2012 This section of the Mississippi Gulf Coast Community College annual financial report presents our
discussion and comparative analysis of the financial performance of the College during ·the fiscal
year ended June 30, 2012. This discussion has been prepared by management along with the
financial statements and related footnote disclosures and should be read in conjunction with and is
qualified in its entirety by the financial statements and footnotes. The financial statements, footnotes,
and this discussion are the responsibility of management.
Using the Annual Report
This annual report consists of a series of financial statements, prepared in accordance with the
Governmental Accounting Standards Board Statement No. 35, Basic Financial Statements and
Management's Discussion and Analysis for Public Colleges and Universities. These statements
focus on the financial condition of the College, the results of operations, and cash flows of the
College as a whole. GASB requires that we present comparative data.
One of the most important questions asked is whether the College as a whole is better or worse off
because of the year's activities. The key to understanding this question is the Statement of Net
Assets, the Statement of Revenues, Expenses, and Changes in Net Assets, and the Statement of Cash
Flows. These Statements present financial information in a form similar to that used by corporations.
It is prepared under the accrual basis of accounting, whereby revenues and assets are recognized
when the service is provided and expenses and liabilities are recognized when others provide the
service, regardless of when cash is exchanged.
The Statement of Net Assets
The Statement of Net Assets includes all assets and liabilities. The College's net assets (the
difference between assets and liabilities) are one indicator of the College's financial health. Over
time, increases or decreases in net assets are one indicator of the improvement or erosion of the
College's financial health when considered with non-financial facts such as enrollment levels and th~
condition of the facilities.
4
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30, 2012 Condensed Statement of Net Assets June 30, 2012 and June 30, 2011 FY2012
Assets
Current assets
Non-current assets
Bond issuance costs, net
Capital, net
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net Assets
Invested in capital assets, net
Restricted:
Expendable
Unrestricted
Total net assets
FY2011
$ 49,178,378
$ 48,776,871
366,050
150,230,93 I
407,699
142,446,975
$ 199.775.35~
$ 191.631.545
$
$
7,141,068
24,733,834
7,276,264
26,956,032
U1.874.902
$ 34.232.296
126,333,183
116,049,407
11,421,586
30,145,688
15,868,756
25,481,086
$ 161,200.451
$J 51 322,242
Assets
Current Assets
Cash and Cash Equivalents
Cash and cash equivalents consist of cash in the College's bank accounts, petty cash, and CDs. The
total amount of cash and cash equivalents reported as current assets on the College'S financial
statements were $37,711,218 at June 30,2012 and $33,665,719 at June 30,2011. This represented
an increase of $4,045,499 or 12% of cash available.
Accounts Receivable
Accounts Receivable relate to several transactions including local appropriations, student tuition and
fees. In addition, receivables arise from grant awards and financial aid revenues. The receivables are
shown net of allowance for doubtful accounts. The College's receivables totaled $5,813,299 at June
30,2012 and $5,294,403 at June 30,2011 which represents an increase of$518,896 or 10%.
5
Mississippi Gulf Coast Comm unity College Management's Discussion and Analysis For the Year Ended June 30, 2012 Inventories The College maintains inventories of resale merchandise within the College bookstore. Books, student supplies, sportswear, gift items, and institutional memorabilia make up the majority of the resale inventory. Inventories totaled $1,893,309 at June 30, 2012 and $1,553,361 at June 30,2011, an increase of$339,948 or 21.9%. Non-current assets
Capital Assets, Net
Capital assets, net, consist of land, improvements, buildings, equipment, historical library holdings,
construction in progress, and assets under capital lease at June 30, 2012. The amount reported is net
of accumulated depreciation. Capital assets, net totaled $150,230,931 at June 30, 2012 and
$142,446,975 at June 30, 2011. This represents a $7,783,956 or 5.5% increase.
Liabilities
Current Liabilities
Accounts Payable and Accrued Liabilities
Accounts payable and accrued liabilities represent amounts due at June 30, 2012 for goods and
services received before the end of the fiscal year. The accounts payable and accrued liabilities
totaled $2,941,396 at June 30, 2012 and $2,624,221 at June 30, 2011.
Deferred Revenues
Deferred revenue represents revenue that was received by the College during the fiscal year, but the
College did not expend the funds by the end of the June 30, 2012 fiscal year. The deferred revenue
totaled $1,525,216 at June 30,2012 and $1,628,967 at June 30, 2011.
Annual Leave Liabilities-Current Portion
Annual leave liabilities-current portion represents the portion of accrued compensated balances that
would be payable by the end of the June 30, 2012 fiscal year. The amount of the current portion of
compensated absences totaled $309,049 at June 30, 2012 and $302,383 at June 30, 2011.
Long-Term Liabilities-Current Portion
Long-term liabilities-current portion represents the portion of long-term debt that would be payable
by the end of the June 30, 2012 fiscal year. The amount of the current portion of long-term debt
totaled $2,149,416 at June 30, 2012 .and $2,492,303 at June 30, 2011.
Non-current Liabilities
Deposits
Deposits represent the deposits paid by students for reservation for and possible damage to a donn
room for the future semester. The housing deposits are payable to the student upon checkout at the
end of the student's stay. The amount of deposits totaled $2,200 at June 30, 2012 and $13,400 at
June 30, 2011.
6
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30, 2012 Accrued Leave
This liability consists of accrued compensated balances that represent the amount payable to
employees for earned but unpaid vacation. The total amount of the non-current portion of accrued
compensation balances totaled $2,983,302 at June 30, 2012 and $3,037,367 atJune 30, 2011.
Long-Term Liabilities
This liability consists of long-term debt for outstanding bonds, notes, and capital leases. The total
amount of the non-current portion of long-term debt was $21,676,896 at June 30, 2012 and
$23,826,311 at June 30, 2011, a decrease of $2, 149,415 or 9%.
Net Assets
Net assets represent the difference between the College's assets and liabilities. Total net assets were
$167,900,457 at June 30, 2012 and $157,399,249 at June 30, 2011. This represents an increase of
$10,501,208 or 6.7%.
Analysis of Net Assets
Restricted expendable net assets consist of grants from third party agencies with expenditure
restrictions, capital projects and lease agreements, and forestry escrow funds.
The following is a breakdown of the restricted net assets:
2012
Capital projects
Other purposes
Total restricted net assets
$
2011
8,587,714
2,833,872
$ 13,553,853
2,314,903
$ 11.421.586
$ 15,868,756
Unrestricted net assets represent those balances from operational activities that have not been
restricted by parties external to the College such as donors or grant agencies. This includes funds
that are normal working capital balances maintained for departmental and auxiliary enterprise
activities.
The following is a breakdown of the unrestricted net assets:
Unrestricted general fund
Unrestricted auxiliary fund
Total unrestricted net assets
2012
2011
$30,152,596
(6,908)
$26,686,627
(1,205,541)
$30,145,688
$25.481,086
7
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30,2012 The Statement of Revenues, Expenses, and Changes in Net Assets
The Statement of Revenues, Expenses, and Changes in Net Assets presents the revenues earned and
the expenses incurred during the year. Activities are reported as either operating or non-operating.
The financial reporting model classifies state appropriations and gifts as non-operating revenues.
The College's dependency on state aid and gifts results in an operating deficit. The utilization of
long-lived assets, referred to as Capital Assets, is reflected in the financial statements as depreciation,
which amortizes the cost of an asset over its expected useful life.
Condensed Statement of Revenues, Expenses, and Changes in Net Assets
June 30, 2012 and June 30, 2011
FY2012
FY2011
$ 21,473,177
47,983,227
6,762,772
209,077
596,801
$ 17,926,212
46,999,703
6,875,084
209,672
555,745
Total operating revenues
77,025,054
72,566,416
Total operating expenses
108,758,200
100,398,042
( 31,733,146)
( 27,831,626)
23,986,356
8,856,106
47,016
(1,087,767)
21,700,254
8,821,587
43,422
(1,778,478)
31,801,711
28,786,785
68,565
955,159
10,432,643
13,841,428
Operating revenues:
Tuition and fees
Grants and contracts
Auxiliary enterprises
Sales & service of education
Other operating revenues
Operating gain/loss
Non-operating revenues (expenses):
State appropriations
Local appropriations
Investment income, net
Other non-operating revenue (expenses)
Net non-operating revenues
Income (loss) before other revenues (expenses)
Total other revenue (expenses)
20,575,973
Special item
Change in net assets
Net assets
Net assets at beginning of year
Net assets, end of year
10,50 I,208
35,372,650
157,399,249
122,026,689
$ 167,900,457
$ 157.399.249
8
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30, 2012 Total operating loss for the fiscal year 2012 was $31,733,146 and for fiscal year 2011 $27,831,626.
Since the State of Mississippi appropriation is not included within operating revenue per GASB No.
35, the College will show a significant operating loss.
The sources of operating revenue for the College are tuition and fees, grants and contracts, auxiliary
services, and other operating revenues.
The College strives to provide students with the opportunity to obtain a quality education. Future
enrollments at the College may be affected by a number of factors including any material increases in
tuition and other mandatory charges stemming from any material decrease in appropriation fl)nding
from the State of Mississippi.
Total operating revenues for fiscal year 2012 were $77,025,054 and for fiscal year 2011
$72,566,416; an increase of $4,458,638 or 6.1%. Tuition and fees, net, were $21,473,177 for fiscal
year 2012 and $17,926,212 for fiscal year 2011. The tuition discount was $5,988,293 for fiscal year
2012 and $9,094,098 for fiscal year 2011. Operating expenses for 2012, including depreciation of
$5,739,655, totaled $108,758,200.
Operating expenses for 2011, including depreciation of
$5,175,786 totaled $100,398,042.
Revenues
Operating Revenues
Tuition and Fees
This category includes all tuition and fees assessed for educational purposes totaling $21,473,177 for
fiscal year 2012 and $17,926,212 for fiscal year 2011. Tuition discounts were $5,988,293 for 2012
and $9,094,098 for 2011.
Operating Grants and Contracts
This includes all restricted revenues made available by government agencies as well as private
agencies. Grant revenues are recorded only to the extent that the funds have been expended for
exchange transactions. Non-exchange revenues are recorded when received or when eligibility
criteria have been met.
The following table details the College's operating grant and contract awards for the fiscal years
ended June 30, 2012 and June 30, 2011.
2012
2011
Federal sources
State sources
Other
$ 40,266,306
5,749,202
1,967,719
$ 37,922,480
6,734,425
2,342,798
Total grants and contracts
$ 47,983.227
$ 46,999,7Ql
9
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30, 2012 Sales and Services from Educational Activities
Other operating revenues consist of income from educational activities and other income that totaled
$209,077 for fiscal year ended June 30,2012 and $209,672 for fiscal year ended June 30, 2011.
Sales and Services, Net
Auxiliary enterprises include the college bookstore, food services, and housing totaling $6,762,772 in
FY12 and $6,875,084 in FYll . This is net of discount.
Operating Expenses
Operating expenses for fiscal year ended June 30, 2012 total $108,758,200 and include salaries and
benefits of $47,666,812, utilities of $2,698,099, supplies of $7,247,931, services of $10,540,826,
scholarships of $34,263,084, travel of $60 1,793 and depreciation of $5,739,655. Operating expenses
for fiscal year ended June 30, 2011 total $100,398,042 and include salaries and benefits of
$48,142,243, utilities of $2,762,450, supplies of $6,595,653, services of $9,368,448, scholarships of
$27,746,619, travel of $606,837 and depreciation of $5, 175,786.
2012
2011
Expenses by function:
Instruction
Instructional support
Student services
Institutional support
Operation of Plant
Student Aid
Auxiliary enterprises
Plant and Endowment Operations
Total operating expenses by function
$ 32,515,279
2,773,005
6,662,928
10,840,138
11,227,137
32,626,304
5,925,778
6,187,631
$ 33,085,983
2,757,951
6,616,250
10,370,299
10,686,788
25,941,782
5,250,959
5,688,030
$108,758.200
$ 100.398,042
Non-operating Revenues (Expenses)
State Appropriations
The College's largest source of non-operating revenues is the State of Mississippi appropriation. The
College received $24,102,964 for fiscal year 2012, of which $23,986,356 was for operations and
$116,608 was spent on behalf of the College for capital projects . The College received $26,592,472
for fiscal year 20 II, of which $21,700,254 was for operations and $4,892,218 was spent on behalf of
the College for capital projects.
Local Appropriations
The College also receives revenue from the four county districts in which the school resides. These
counties include Harrison, Jackson, George, and Stone County. The College receives the
appropriation in monthly payments beginning in July - of each year. The College received
$17,951,219 in fiscal year 2012 of which $8,856,106 was for operating purposes and $9,095,113
which was used for capital purposes. The College received $17,950,654 in fiscal year 2011 of which
$8,821,587 was for operating purposes and $9,129,067 which was used for capital purposes.
10
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30, 2012 Investment Income, Net
This includes the interest income from the cash in the bank accounts. The investment income at
June 30, 2012 was $47,016 and at June 30, 2011 was $43,422, which represents an increase of
$3,594 or 8.2%. Due to a lagging economy, interest rates are very low.
Other Non-operating Revenues & Expenses
Included in this category is the net amortization of bond issue costs and bond premiums totaling ­
$34,130 and the interest on long term indebtedness for fiscal year 2012 totaling $1,039,265. Bond
issue costs and bond premium totaling $34,129, and the interest on long term indebtedness for fiscal
year 20 II totaled $1,727,528.
Other Revenues
State Appropriations for Capital Purposes
This is revenue received from the State of Mississippi to purchase, construct, renovate, or repair
capital assets during the fiscal year. Fiscal year 2012 capital appropriations were $116,608 for
prepaid projects and fiscal year 20 II capital appropriations were $4,892,218.
Local Appropriations for Capital Purposes
This is revenue received from the four county districts of Harrison, Jackson, George, and Stone
Counties wherein the College resides. Fiscal year 2012 local appropriations were $9,095,113 and
fiscal year 2011 local appropriations were $9,129,067.
Statement of Cash Flows
Another important factor to consider when evaluating financial viability is the College's ability to
meet financial obligations as they mature. The Statement of Cash Flows presents information related
to cash inflows and outflows summarized by operating, non-capital financing, capital and related
financing, and investing activities
Another way to assess the financial health of the College is to look at the Statement of Cash Flows.
Its primary purpose is to provide relevant information about the cash receipts and cash payments of
the college during a period. The Statement of Cash Flows also helps users assess:
•
•
•
The ability to generate future net cash flows,
The ability to meet obligations as they come due, and
A need for external financing.
11
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30, 2012 Condensed Statement of Cash Flows (Direct Method) For the fiscal years ended June 30, 2012 and June 30, 2011 2012 Cash and cash equivalents provided (used) by:
Operating activities
Non-capital financing activities
Capital and related financing activities
Investing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year
Major sources of funds included in operating activities :
Tuition and fees
Auxiliary enterprises
Grants and contracts
Major uses offunds were payments to:
Employees
Suppliers
Services
Scholarships and fellowships
Utilities
$(24,842,280)
32,553,528
( 6,655,974)
2,990,225
4,045,499
33,665,719
2011 $(20,809,167) 30,418,399 ( 7,116,708) ( 2,981,372 (
488,848) 34,154,567 $ 37,711.218
$ 33,665,719
$ 21,201,319
6,767,199
47,818,890
$ 18,237,059
6,803,570
47,604,672
(47,714,211)
( 7,270,704)
( 8,995,574)
(34,263,084)
( 2,698,099)
(48,397,186)
( 6,459,370)
( 8,225,435)
(27,746,619)
( 2,762,450)
The largest inflow of cash in the non-capital financing activities group for FY2012 is the State
appropriation of$23,694,549 and for FY2011 is $21,625,042. In addition, local appropriations from
the four county districts are $8,858,979 for FY20 12 and $8,793,357 for FY2011.
12
Mississippi Gulf Coast Community College Management's Discussion and Analysis For the Year Ended June 30,2012
Significant Capital Asset Transactions
The College incurred the following transactions regarding capital construction projects during the 2012 fiscal year: District Office Total Construction expenses were $350,239.
Projects include OCR Compliance projects totaling $52,726; RepairlRenovate North
Wall of Darby Hall $54,290; RepairlRenovate Liaison $11,245; and Cooling and power
upgrades totaling $231,978.
Perkinston Campus Total Construction expenses were $3,273,425.
Expenditures include Learning Resource Center $2,255,982; Band Marching Field Tower
and Storage BuildinglImprovements $226,454; Malone Hall HVAC $549,109;
Community Arts Center $30,966; Poles/Signs Installation $35,630; Metal Building
$27,130; Roofing/S ign/Gating/Landscape/Parking $148,154.
Jefferson Davis Campus Total Construction expenses were $6,209,390.
Expenditures include Hospitality & Resort Management (District Bonds) $3,786,679,
(EDA) $987,095, and (State Bonds) $144,900; Bookstore Renovation & Expansion
$20,599; Landscaping SW Parking Lot $78,985; Renovation of Learning Lab $603,609;
Landscape Interior Courtyard CT Complex $270,478; Campus-wide door replacement
$83,818; Resurface/restripe Switzer Rd. Parking Lot $107,298; Roof/Outdoor
camera/Theatre auditorium $125,929.
Jackson County Campus Total Construction expenses were $1,801,960.
FY12 projects include Landscaping Phase VI-North Campus $18,670; Renovation of
Drafting/Campus Security $1,152,376; Replace Bookstore/Cafeteria Chiller $69,416;
CTE Renovation $126,601; Parking LotlLightingiSidewalk $179,736; Auditorium
lighting $98,206; Underground electrical work $71,919; and Fine Arts/Gym/Allied
Health Roof $85,036.
Advanced Manufacturing Technology Center Total Construction expenses were $23,835.
HVAC replacement totaled $23,835.
George County Center Total Construction expenses were $142,199.
ReworklRestripe Parking lot totaled $142,199.
Funding sources for these projects included $3,786,679 in District Bonds, $2,400,882 in State
Bonds, $1,068,262 from federal funds, and $4,545,225 from other and local sources.
13
Mississippi Gulf Coast Community College Management's Discussion and AnaJysis For the Year Ended June 30, 2012 Factors Impacting Future Periods
There are a number of issues that are directly impacting the community college system as a whole.
The continuing decline of state revenues and; therefore, state funding, is the main issue which will
continue to have an impact on our financial position. State funding makes up approximately 22% of
our total current funds budgets in FYI2; this makes the level of state support a key factor in the
financial health of the institution. Our national economy has declined and the State of Mississippi is
seeing tax collections that are falling short of expectations. We have been fortunate to have strong
support from our local district as they are increasingly bearing more and more of the burden to
provide support for the College during the last several years.
One of the internal considerations with each year's budget is the desire to refrain from tuition
increases as this is a major barrier to college education for our local residents. The College was able
to avoid a tuition increase in FY2012; however, future increases will depend on the economic climate
and level of state support that the institution receives. A decline in education will result in further
decline of future state revenues and quality of life for state citizens if we can't meet the education
and technology demands of businesses and industries.
In addition to operating challenges, our need for deferred maintenance funds and new construction
continue to challenge our ability to maintain reserve funds. These expenditures will continue to
increase as our buildings age. The College will explore retro-fitting buildings as opposed to new
construction to meet the educational needs of students and the community. New technological
advances will demand that we constantly update our training and College-wide database needs.
The community college is the most accessible higher-education option available for the majority of
Mississippians and we are obligated to make certain that our College is prepared to meet the demand
for quality programs and facilities that are close to home and at a reasonable cost. This is even more
impQrtant with the nation in an economic decline and recession as we are currently providing for
higher numbers of students using fewer dollars.
Contact Information
Questions concerning any of the Mississippi Gulf Coast Community College Foundation, Inc.
information provided in this report or requests for additional financial information should be
addressed to the Associate Vice President for Development, Russell Young, Mississippi Gulf
Coast Community College Foundation, Inc., P.O. Box 99, Perkinston, MS 39573.
Questions concerning any of the information provided in this report or requests for additional
financial information should be addressed to the Comptroller, Shelly Ford, Mississippi Gulf
Coast Community College, P.O. Box 609, Perkinston, MS 39573.
14
Mississippi Gulf Coast Community College
Statement of Net Assets
June 30, 2012
Mississippi Gulf
Coast Community
College
Assets
Current assets:
Cash and cash equivalents
Short-term investments
Investments
Interest receivable
Accounts receivable, net
Inventories
Prepaid expenses
Total current assets
Non-current assets:
Utility deposit
Endowment investments
Bond issuance costs, net of amortization
Capital assets, netof accumulated depreciation
Total non-current assets
Total assets
Liabilities
Current liabilities:
Accounts payable and accrued liabilities
Due to MSGCCC Alumni Association, Inc.
Accrued interest payable
Deferred revenues
Accrued leave liabilities, current portion
Long-term liabilities, current portion
Total current liabilities
Non-current liabilities:
Deposits refundable
Accrued leave liabilities
Bond premium
Long-term liabilities
Total non-current liabilities
37,711 ,218
3,042,100
$
Net assets
Invested in capital assets, net of related debt
Restricted for:
Nonexpendable:
Scholarships and fellowships Expendable: Invested in property Capital projects Other purposes
Temporarily restricted
Unrestricted:
Available for operations
Invested in property and equipment
1,596,948
1,039,784
18,013
2,397
5,813 ,299
1,893 ,309
716,055
49,178,378
2,654,745
25
3,754,829
366,050
150,230,931
150,596,981
719,724
4.474.578
---12.2.ns. 359
7129323
2,941,396
422,136
980
215,991
1,525,216
309,049
2.149,416
7,141,068
423,116
2,200
2,983,302
71,436
21,676,896
24,733,834
423116
31874902
Total liabilities
Total net assets
$
Component Unit
Mississippi Gulf
Coast Community
College Foundation
126,333,183
3,754,829
213,501
8,587,714
2,833,872
1,954,816
276,838
506,223
30,145,688
$ 167,900.421
The notes to the financial statements are an integral part ofthis statement.
$
6,706,207
15
Mississippi Gulf Coast Community College Statement of Revenues, Expenses, and Changes in Net Assets June 30, 2012 Mississippi Gulf
Coast Community
College Operaling revenues Tuition and fees (net of schol;rship discount $5,988,293 and provision for uncollectble accounts $375,595)
Gifts and contributions
Federal grants and contracts
State grants and contracts
Local grants and contracts
Private grants and contracts
Sale and services of educational activities
Auxiiiary services (net of discount$229,418)
In-kind support
Other operating revenues
Tolal operating revenues
Operaling expenses
Salary and wage
Fringe benefits
Travel
Contractuals
Commodities
Utilities
Financial aid
Scholarships
Program services general program
Other
In-kind services
Depreciation
Tolal operaling expenses
$
968,139
216,765
596,801
77,025,054
~pport
5,739,655
108,758,200
(
Non-operating revenues (expenses)
State appropriations (current funds)
Local appropriations (current funds)
Investment income
Amortization of bond ig;ue costs
Amortization of bond premium
Interest on indebtedness
Unrealized investment gain (loss)
Realized investment gain (loss)
Arbitrage/cash management
Nel non-operaling revenues
Income (loss) before olher revenues, expenses, gains and losses
State appropriations for capital purposes
Local appropriations for capital purposes
Federal appropriations for capital purposes
Plant assets sold/retired
Miscellaneous revenue
Additions to permanent enjowments
Tola! olher revenue (expenses)
Net assets, end of year
$
40,266,306
5,749,202
70,150
1,897,569
209,077
6,762,772
37,026,239
10,640,573
601,793
10,540,826
7,247,931
2,698,099
34,263,084
Operaling gainlloss
Change in nel assels
Net assets:
Net assets, beginning ofyear
21,473,177
Component Unit Mississippi Gulf Coast Community College Foundation 31,733,146)
23,986,356
8,856,106
47,016
41 ,648)
7,518
1,039,265 )
685)
4
13,691 )
31,801.711
68,565
1.184,904
12,500
393,763
629,672
28,320
216,765
15,094
1,296,114
111,210)
143,258
107,065 )
43,676
79,869
31,341 )
116,608
9,095,113
1,106,966
145,440 )
259,396
10,432,643
127,941
127,941
10,501,208
96,600
157,399,249
6,609,607
LJ..67 900 457
~.7062Q7
The notes to the finanCial statements are an integral part of this statement.
16
Mississippi Gulf Coast Community College Statement of Cash Flows For the Year Ended June 30,2012
Mississippi Gulf Coast Community College Cash flows from operating activities:
Tuition and fees
Contributions received
Grants and contracts
Sales and services of educational departments
Payments to suppliers and students
Payments to employees for salaries and benefits
Payments to contractual services
Payments to travel
Payments for utilities
Payments for scholarships
Auxiliary enterprise charges
Other receipts (payments)
$ 21,20 1,319
$
969,049
47,818,890
209,077
( 7,270,704)
(47,714,211)
( 8,995,574)
( 601,793)
( 2,698,099)
(34,263,084)
6,767,199
704,700
Net cash provided (used) by operating activities
(24,842,280)
Cash flows from non-capital financing activities:
State appropriations Local appropriations Federal loan program receipts Federal loan program disbursements 23,694,549
8,858,979
14,231,654
( 14,231,654)
Net cash provided (used) by non-capital financing activities Component Unit Mississippi Gulf Coast Community College Foundation ( 1,216,488)
(
247,439) 32,553,528
Cash flows from capital and related financing
activities:
Cash received for additions to permanent
endowments Proceeds from disposal of capital assets Proceeds from insurance Cash paid for capital assets Capital appropriations received Other receipts Principal paid on capital debt and leases Interest paid on capital debt and leases 108,246
233,501
(13,777,298)
10,297,646
25,897
( 2,492,302)
( 1,051,664)
Net cash provided (used) by capital and related financing activities ( 6,655,974)
127,941 The notes to the finanCial statements are an integral part ofthis statement.
127,941 17
Mississippi Gulf Coast Community College . Statement of Cash Flows For the Year Ended June 30,2012 (Continued) Mississippi Gulf Coast Community College ComQonent Unit
Mississippi Gulf Coast Community College Foundation Cash flows from investing activities:
Proceeds from sales and maturities of investments
Interest and dividends received on investments
Cash paid for investment fees
Purchases of investments
$ 12,813,958
Net cash provided (used) by investing activities
2,990,225
262,227
Net increase (decrease) in cash and cash
equivalents
4,045,499
142,729
33,665,719
1,454,219
44,407
13,691)
(
( 9,854,449)
Cash and cash equivalents - beginning of the year
Cash and cash equivalents - end of the year
$
1,941,081
137,692
( 1,816,546)
$ 31,111,218
$
$(31,733,146)
$(
1,526,2~8
Reconciliation of operating income (loss) to net
cash provided (used) by operating activities:
Operating income (loss)
Adjustments to reconcile net income (loss) to net
cash provided (used) by operating activities:
Depreciation expense
Changes in assets and liabilities:
(Increase) decrease in assets:
Receivables, net Inventories Prepaid expenses Increase (decrease) in liabilities: Accounts payables and accrued liabilities Due'to Mississippi Gulf Coast Community College Alumni Association, Inc. Deferred revenues Deposits refundable Accrued leave liability 208,918)
339,948)
1,545,252
317,175
Net cash provided (used) by operating activities
(
152,233)
910
(
(
(
103,751)
11,200)
47,399)
6,890,866
Total adjustments
15,094
5,739,655
(
(
111,210)
$(24,842,28Q) The notes to the financial statements are an integral part ofthis statement.
(
136,229)
$(
241,432)
18
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30, 2012 Note 1 - Summary of Significant Accounting Policies
(a) Reporting Entity - Miss.issippi Gulf Coast Community College is governed by a 23-member
board composed of trustees from George, Harrison, Jackson and Stone Counties. The
members of the board of trustees from each county are elected by the Board of Supervisors of
the county. This institution has a district office, three campuses and four centers which
provide academic, career-technical training, and non-credit education.
Governmental Accounting Standards Board Statement No. 14 requires that the financial
reporting entity consist of the primary government and its component units.
Discretely Presented Component Unit
For the year ended June 30, 2005, the College implemented GASB Statement No. 39,
Determining Whether Certain Organizations Are Component Units, and Amendment of
GASB Statement No. 14.
The Mississippi Gulf Coast Community College Foundation, Inc. is being included as a
discretely presented component unit of the College in the College's basic financial
statements, in accordance with the criteria outlined by GASB. The Foundation has been
organized to promote, encourage and assist in all forms of education and research in the
College's districts, campuses and activities.
With the exception of necessary presentation adjustments, no modifications have been made
to the foundation's financial information in the College's financial report for differences
between GASB and the Financial Accounting Standards Board (FASB).
The Foundation is a legally separate, tax-exempt organization supporting the College. The
Foundation is included in the College's financial statements because it met GASB's criteria
for inclusion.
Also, the Mississippi Gulf Coast Community College Foundation pays tuition on behalf of
students of the College. For the year ended June 30, 2012, total scholarships expensed were
$393,763 of which $373,074 was payable at year-end.
19
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30, 2012 Note 1 - Summary of Significant Accounting Policies (continued)
(b) Basis of Presentation - The financial statements have been prepared in accordance with
accounting principles generally accepted in the United States of America as prescribed by the
Governmental Accounting Standards Board (GASB), including Statement No. 34, Basic
Financial Statements - and Management's Discussion and Analysis - for State and Local
Governments; Statement No. 35, Basic Financial Statements - and Management's Discussion
and Analysis - for Public Colleges and Universities, issued in June and November, 1999,
respectively. The College now follows the "business-type activities" reporting requirements
of GASB Statement No. 34 that provides a comprehensive one-line look at the College's
financial activities.
Component Unit
The Foundation follows the provisions of Statement of Financial Accounting (SF AS) No.
117, Financial Statements of Not-for-Profit Organizations, which establishes external
financial reporting for not-for-profit organizations which includes the financial statements
and the classifications of resources into three separate classes of net assets as follows:
Unrestricted - Net assets which are free of donor-imposed restrictions; all revenues,
expenses, gains, and losses that are not changes in permanently or temporarily restricted net
assets.
Temporarily Restricted - Net assets whose use by the Foundation is limited by donor­
imposed stipulations that either expire by passage of time or that can be fulfilled or removed
by actions of the foundation pursuant to those stipulations.
Permanently Restricted - Net assets whose use by the Foundation is limited by donor­
imposed stipulations that neither expire with the passage of time nor can be fulfilled or
otherwise removed by actions of the foundation.
(c) Basis of Accounting - The financial statements of the College have been prepared on the
accrual basis whereby all revenues are recorded when earned and all expenses are recorded
when they have been reduced to a legal or contractual obligation to pay.
(d) Cash Equivalents - For purposes of the Statement of Cash Flows, the College considers all
highly liquid investments with an original maturity of three months or less to be cash
equivalents.
(e) Short-term Investments - Investments that are not cash equivalents but mature within the
next fiscal year are classified as short-term investments.
(f) Investments - The College accounts for its investments at fair value in accordance with
GASB No. 31, Accounti.ng and Financial Reporting for Certain Investments and for External
Investment Pools. Changes in unrealized gain (loss) on the carrying value of investments are
reported on the Statement of Revenues, Expenses and Changes in Net Assets.
20
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30, 2012 Note 1 - Summary of Significant Accounting Policies (continued)
(g) Accounts Receivables, Net - Accounts receivables consist of tuition and fees charged to
students, state appropriations, amounts due from state and federal grants and contracts, local
governments and credits due to the College from vendors. Accounts receivables are recorded
net of an allowance for doubtful accounts.
(h) Inventories - Inventories consist of bookstore supplies, textbooks, and merchandise for resale.
Merchandise for resale and bookstore supplies are valued at cost, on the first-in, first-out
("FIFO") basis. Textbooks are valued on a method assuming a three year usage. It is also
assumed that all sales are from books purchased in the current year.
(i) Capital Assets, Net of Accumulated Depreciation - Capital assets are recorded at cost at the
date of acquisition, or, if donated, at fair market value at the date of donation. Renovations to
buildings and improvements other than buildings that significantly increase the value or
extend the useful life of the structure are capitalized. Routine repairs and maintenance are
charged to operating expense in the year in which the expense was incurred. Depreciation is
computed using the straight-line method over the estimated useful life of the asset and is not
allocated to the functional expenditure categories. See Note 4 for additional details
concerning useful lives, salvage values and capitalization thresholds. Expenditures for
construction in progress are capitalized as incurred. Interest expense relating to the
construction is capitalized net of interest income earned on resources set aside for this
. purpose.
(j) Deferred Revenues - Deferred revenues include amounts received for tuition and fees and
certain auxiliary activities prior to the end of the fiscal year but related to the subsequent
accounting period. Deferred revenues also include amounts received from grant and contract
sponsors that have not yet been earned.
(k) Compensated Absences - Twelve-month employees earn annual personal leave at a rate of
6.67 hours per month for one month to three years of service; 9 hours per month for three to
eight years of service; 12 hours per month for eight to fifteen years of service; and from
fifteen years of service and over, 13 hours per month are earned. Nine and ten month
employees earn annual leave at a rate of 7.11 hours per month of service. Hourly employees
earn annual personal leave at a rate of 6.67 hours per month for one month to eight years of
service; 9 hours per month for eight to fifteen years of service; and from fifteen years and
over, 9 hours per month. There is no requirement that annual leave be taken and there is no
maximum accumulation. At termination, these employees are paid for up to 240 hours of
accumulated annual leave. The liability for accrued leave at June 30, 2012 as reported in the
Statement of Net Assets is $3,292,351 with $309,049 of this amount estimated as current.
21
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30,2012 Note 1- Summary of Significant Accounting Policies (continued)
(I) Classification of Revenues - The College has classified its revenues as either operating or
non-operating revenues according to the following criteria:
Operating revenues: Operating revenues include activities that have the
characteristics of exchange transactions, such as (I) student tuition, net of
scholarship discounts and allowances, (2) sales and services of auxiliary
enterprises, net of scholarship discounts and allowances and (3) most federal,
state and local grants and contracts.
Non-operating revenues: Non-operating revenues include activities that have
the characteristics of non-exchange transactions, such as gifts and
contributions, and other revenue sources that are defined as non-operating
revenues by GASB Statement No.9, Reporting Cash Flows of Proprietary
and Nonexpendable Trust Funds and Governmental Entities That Use
Proprietary Fund Accounting and GASB Statement No. 34, such as state
appropriations, local appropriations and investment income.
(m) State Appropriations - Mississippi Gulf Coast Community College receives funds from the
State of Mississippi based on the total credit hours generated by all students actually enrolled
and in attendance on the last day of the sixth week (or its equivalent) of the each semester for
the previous year, counting only those students who reside within the State of Mississippi.
(n) Scholarship Discounts and Allowances - Financial aid to students is reported in the financial
statements under the alternative method as prescribed by the National Association of College
and University Business Officers (NACUBO). Certain aid, such as loans, funds provided to
students as awarded by third parties and Federal Direct Lending, is accounted for as a third
party payment (credited to the student's account as if the student made the payment). All
other aid is reflected in the financial statements as operating expenses, or scholarship
allowances, which reduce revenues. The amount reported as operating expenses represents
the portion of aid that was provided to the student in the form of cash. Scholarship
allowances represent the portion of aid provided to the student in the form of reduced tuition.
Under the alternative method, these amounts are computed on a college basis by allocating
the cash payments to students, excluding payments for services, on the ratio of total aid to the
aid not considered to be third party aid.
22
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30, 2012 Note 1 - Summary of Significant Accounting Policies (continued)
(0) Net Assets - GASB Statement No. 34 reports equity as "Net Assets" rather than "Fund
Balance". Net assets are classified according to external donor restrictions or availability of
assets for satisfaction of College obligations. Expendable restricted net assets represent
funds that have been gifted for specific purposes and funds held in federal loan programs.
The unrestricted net asset balance of $30,145,688 at June 30, 2012, includes $1,893,309,
reserved for inventories and a remaining amount of $28,252,379.
Note 2 - Cash and Investments
Policies
(a) Cash, Cash Equivalents, and Short-Tenn Investments - Investment policies as set forth by
policy and state statute authorize the College to invest in demand deposits and interest­
bearing time deposits such as savings accounts, certificates of deposit, money market funds,
U.S. Treasury bills and notes, and repurchase agreements.
The collateral for public entities' deposits in financial institutions are now held in the name of
the State Treasurer under a program established by the Mississippi State Legislature and is
governed by Section 27-105-5, Miss. Code Ann. (1972). Under this program, the College's
funds are protected through a collateral pool administered by the State Treasurer. Financial
institutions holding deposits of public funds must pledge securities as collateral against these
deposits. In the event of failure of a financial institution, securities pledged by that institution
would be liquidated by the State Treasurer to replace the public deposits not covered by the
Federal Depository Insurance Corporation.
Custodial Credit Risk - Deposits. Custodial risk is the risk that in the event of a depository
failure, the college deposits may not be returned to it. The College does not have a fonnal
policy for custodial credit risk. However, state law pennits the Mississippi State Treasurer's
office to manage that risk on behalf of the College. Deposits above FDIC coverage are
collateralized by the pledging financial institution's trust department or agent in the name of
the Mississippi State Treasurer on behalf of the College. By signed agreement the
Mississippi State Treasurer's office is acting on behalf of the College.
23
Mississippi Gul(Coast Community College
Notes to Financial Statements
For the Year Ended June 30, 2012
Note 2 - Cash and Investments (continued)
Investments.
The College had the following investments at year end:
Investment
Certificates of Deposit
Maturities
(in years)
Less than I
Credit Rating
AAA
Fair Value
$ 3,042,100
Investments are reported at fair value which is based on quoted market price.
Nonparticipating investment contracts such as non-negotiable certificates of deposit are
reported at cost.
Interest Rate Risk. The College does not have a formal investment policy that limits
investments maturities as a means of managing its exposure to fair value losses arising from
increasing interest rates.
Note 3 - Accounts Receivable
Accounts receivable consisted of the following atJune 30, 2012:
Student tuition
Federal and state grants
Local appropriations
State appropriations
Other
$ 6,586,826 Total accounts receivable
13,453,880
Less allowance for doubtful accounts
(7,640,581)
Net accounts receivable
2,916,453 383,471 644,285 2,922,845
.$ 5,813.299
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30, 2012 Note 4 - Capital Assets A summary of changes in capital assets for the year ended June 30,2012, is presented as follows: Beginning
Balance
7/01111
Non-depreciable Capital Assets:
Land
Construction in Progress
Total Non-depreciable Capital Assets
$
2,811,605
5,123,221
7,934,826
Deletions
Additions
$
Ending
Balance
6/30112
38,279
11,801,048
11,839,327
$
( 3,673,023)
( 3,673,023)
2,849,884
13,251,246
16,101,130
$
Depreciable Capital Assets:
Other Structures & Improvements
Buildings
Equipment
Library Books
Total Depreciable Capital Assets
41,631,141
131,798,385
13,684,368
1,498,675
188,612,569
1,094,023
2,464,308
1,960,694
91,968
5,610,993
(
(
(
(
(
64,370)
60,000)
1,187,014)
204,319)
1,515,703)
42,660,794
134,202,693
14,458,048
1,386,324
192,707,859
Less Accumulated Depreciation for:
Other Structures & ImproveI)1ents
. Buildings
Equipment
Library Books
Total Accumulated Depreciation
8,921,362
35,822,212
8,493,020
863,826
54,100,420
1,620,716
2,474,157
1,506,150
138,632
5,739,655
(
(
41,049)
48,000)
992,970)
179,998)
1,262,017)
10,501,029
38,248,369
9,006,200
822,460
58,578,058
Total Depreciable Capital Assets, net
134,512,149
128,662)
(
253,686)
134,129,801
$( 3 226,1Q2)
$J~_1Q.w
Capital Assets, net
$J 42.446 975
(
$ 11.11Q 665
(
(
(
25
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30,2012 Note 4 - Capital Assets (continued)
Repair and renovation projects as well as equipment purchases that are associated with debt in which
the College has incurred debt will be capitalized and depreciated no matter the individual cost of
such items.
Depreciation is computed on a straight-line basis with the exception of the library books category,
which is computed using the composite method. The following useful lives, salvage values, and
capitalization thresholds are used to compute depreciation:
Buildings
Improvements
Equipment
Library Books
Estimated
Useful Lives
40 years
20 years
3-15 years
10 years
Salvage
Value
20%
20%
1-10%
0%
Capitalization
Threshold $
50,000 50,000 5,000 0
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30, 2012 Note 5 - Long-term Liabilities
Long-term liabilities of the College consist of notes and bonds payable, capital lease obligations and certain other liabilities that are expected to be
liquidated at least one year from June 30, 2012. The various leases cover a period not to exceed ten years. The College has the option to prepay all
outstanding payments less any unearned interest to fully satisfy the obligation. There is also a fiscal funding addendum stating that if funds are not
appropriated for periodic payment for any future fiscal period, the lessee will not be obligated to pay the remainder of the total payments due beyond the
end of the current fiscal period.
Information regarding original issue amounts, interest rates and maturity dates for bonds, notes and capital leases included in the long-term liabilities
balance at June 30, 2012, is listed in the following schedule. A schedule detailing the annual requirements necessary to amortize the outstanding debt is
also provided.
Description and PUrpose
Bonded Debt
MGCCC Limited Tax Obligation Bonds
MS Development Bank Special Obligation Bonds
Total Bonded Debt
Notes Payable
Perkinston Infrastructure Upgrade
Economic Development Loan # 1
Economic Development Loan # 2
Original
Issue
$ 21,700,000
12,300,000
613,001
360,000
450,000
Annual
Interest Rate
Maturity
4.00%
4.00-5.00%
2020
2024
$ 14,635,000
10,570,000
25,205,000
2.00%
0.00%
0.00%
2026
2012
2016
Total Notes Payable
Capital Leases
Energy Conservation Equipment
Total Capital Leases
Other Long-tenn Liabilities
., Accrued Leave Liabilities
Deposits Refundable
Total Other Long-term Liabilities
Total
Due within one year
Total Long-term Liabilities
3,367,618
3.85%
2012
Beginning
Balance
Additions
$
Deletions
Balance
June 30, 2012
Due Within
One Year
1,365,000
620,000
1,985,000
$ 13,270,000
9,950,000
23,220,000
464,312
30,000
220,833
28,833
30,000
50,000
435,479
29,416
170,833
50,000
715,l4~
108,833
606,312
79,416
3,292,351
2,200
3,294,551
309,049
$
398,469
398,469
398,469
398,469
3,339,750
13,400
3,353,150
47,399
11,200
58,599
$ 29.671.764
$
$
2.550.901
27,120,863
(2,458,465)
$. 24,662.398
$
1,425,000
645,000
2.070,000
309,049
L2Ai8..4~
27
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30,2012 Note 5 - Long-term Liabilities (continued)
Annual requirements to amortize outstanding long-term debt are as follows:
Bonded
Debt
Notes
Payable
Interest
Total
Year Ending June 30
2013
2014
2015
2016
2017-2021
2022-2026
Totals
$ 2,070,000 $
2,160,000
2,250,000
2,350,000
11,405,000
2,985,000
79,416
80,010
80,616
52,067
165,883
148,320
$23.220,000
6Q6,312 $ 5,582,745 $22,416,Q51
$
$
966,579 $ 3,115,995
883,185
3,123,195
796,179
3,126,795
703,211
3,105,278
13,547,873
1,976,990
263,601
3,396,921
Mississippi Gulf Coast Community College
Notes to Financial Statements
For the Year Ended June 30,2012
Note 6 - Natural Classifications with Functional Classifications
The College's operating expenses by functional classification were as follows for the year ended June 30, 2012:
Functional Classification
Instruction
Instructional Support
Student Services
Institutional Support
Operation of Plant
Student Aid
Auxiliary Enterprises
Plant and Endowment Ops.
Salaries &
Wages
$ 22,387,918
1,938,945
3,728,117
5,404,672
2,931,595
Fringe
Benefits
$
Travel
6,079,833· $
546,658
1,216,844
1,550,771
1,021,764
254,488
25,748
167,527
149,914
450
Contractual
Services
$
1,761,579
68,783
474,165
3,054,291
Utilities
$
7,885
Scholarships &
Fellowships
$
950,445
Commodities
Depreciation
Expense
$
$
624,003
62,332
2,268,301
4,199,950
1,073,131
192,871
452,272
618,158
805,077
$ 37.026.23..2.
3,666
224,703
$ 1Q 64Q 513
$
6QJ 123
421,913
590,753
391,305
~..Q..82Q
$
2628022
$ 34263084
$
$ 32,515,279
2,773,005
6,662,928
10,840,138
11,227,137
32,626,304
634,992
Total
4,049,751
56,671
__ 5,739,655
32,626,304
5,925,778
6.187.631
2241231
~39.655
$108.758.200
29
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30, 2012 Note 7 - Construction Commitments and Financing
The institution has contracted for the construction of the following projects. At June 30, 2012,
estimated costs to complete the projects are $19,739,027. The remaining costs are to be funded as
follows:
Total Costs
to Complete
Local funds:
District Office
RepairlRenovlNorth Wall Darby Hall
OCR Compliance Projects
Perkinston Campus Driving Range Development Sekul Field House Renovations Landscaping Front of Campus Marching Field Storage Building Jefferson Davis Campus
HospitalitylResort Mgmt. (EDA)
Bookstore Renovation/Expansion
Landscaping SW Parking Lot
Jackson County Campus
HVAC Unit Replacement
Landscaping Phase VI-North Campus
Underground Electrical Work
Renovation Drafting/Campus Security
Roof Replacement-Allied Health Bldg
District Bonds Jefferson Davis Campus: HospitalitylResort Management State Bond Funds:
Perkinston Campus Learning Resource Center Dees Hall Renovation Jefferson Davis Campus Hospitality & Tourism Site Total
$
Funded By
State
Institutional
Sources
Funds
Federal
Sources
58,697 $
149,336
$
$
1,891,956 20,599 86,578 100,636 47,740 71,919 1,136,873 86,110 100,636
47,740
71,919
1,136,873
86,110
3,841,913
3,841 ,913
5,056,820 2,975,911 5,056,820
2,975,911
3.438,697 _ _ _ _
$19.239027
58,697 $
149,336
8,798
2,864
55,025
208,555
8,798
2,864
55,025
208,555
1,891,956
20,599
86,578
Other
_-,3!.1.:,4~3~8.~69~7
_ _ _ _ __ __
$1.891.956 $11.471 428 $ 2033.730 $ 3 841.913
30
Mississippi Gulf Coast Community College Notes to Financial Statements For the Year Ended June 30, 2012
Note 8 - Pension Plan
Plan Description: The College contributes to the Public Employees' Retirement System of
Mississippi (PERS), a cost-sharing multiple-employer defined benefit pension plan. PERS provides
retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan
members and beneficiaries. Benefit provisions are established by state law and may be amended
only by the State of Mississippi Legislature. PERS issues a publicly available financial report that
includes financial statements and required supplementary information. That information may be
obtained by writing to Public Employees' Retirements System, PERS Building, 429 Mississippi
Street, Jackson, MS 39201-1005 or by calling (601)359-3589 OR l-800-444-PERS.
Funding Policy:
PERS members are required to contribute 9% of their annual covered salary. The institution is
required to contribute at an actuarially determined rate. The rate at June 30, 2012 was 12.93% of
annual covered payroll. The rated increased to from 12% to 12.93% on January 1,2012. Effective
July 1, 2012, the rate increased to 14.26%. The contribution requirement of PERS members are
established and may be amended only by the State of Mississippi Legislature. The institution's
contributions to PERS for the years ending June 30, 2012, 2011, and 2010 were $4,403,605,
$4,248,500, and $4,330,305, respectively, equal to the required contributions for each year.
Note 9 - Evaluation of Subsequent Events
The College has evaluated subsequent events through December 14, 2012, the date which the
financial statements were available to be issued.
The College issued Limited Tax Obligation Bonds in December 2012, in the amount of $9,995,000
for the purpose of refunding a portion of the Series 2005A Bonds. The maturity period for the new
bonds is the same as the bonds that were retired. The interest rate on the new bonds is 1.607%.
31
Mississippi Gulf Coast Community College
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2012
Federal GrantorlPass-through GrantorlProgram or Cluster Title
Federal
CFDA
Number
Pass-through
Entity Identifying
Number
Federal
Expenditures
Student Financial Aid-Cluster:
U.S. Department of Education:
Federal PELL Grant Program
Academic Competitiveness Grant
Federal Supplemental Educational Opportunity Grants
Federal Direct Student Loans
Federal Work-Study Program
Total Student Financial Aid Cluster
84.063
84.375
84.007
84.268
84.033
$ 22,036,234
84.153
13,513
84.002
550,226
349
251,780
14,231 ,654
194,896
36,714,913
Other Programs:
U. S. Department of Education:
Business and International Education Projects
Pass-through Programs From:
State Board of Community and Junior Colleges
Adult Education - Basic Grants to States .
State Department of Education - Career and Technical
Education - Basic Grants to States
Tech-Prep Education
Total U.S. Department of Education
84.048
84.243
E-V048A020024
E-V243AO I0024
611,817
15,000
1,190,556
U.S. Department of Health & Human Services :
Scholarships for Health Professions Students from
Disadvantaged BackgrolUlds Total U.S. Department of Health & Human Services 93 .925
58,653
58,653
National Science FOlUldation:
Education and Human Resources
Total National Science FOlUldation
47.076
15,189
15,189
Institute of Museum and Library Services:
National Leadership Grants
Total Institute of Museum and Library Services
45.312
45,402
45,402
National Aeronautics and Space Administration:
Pass-through Program From:
University of Mississippi - Science
Total National Aeronautics and Space Administration
43.001
4,792
4,792
U.S Department of Agriculture
State Administrative Matching Grants for the Supplemental
Nutrition Assistance Program Total U.S. Department of Agriculture 10.561
42,375
42,375
32
Mississippi Gulf Coast Community College
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2012
Federal GrantorfPass-through GrantorfProgram or Cluster Title
U.S. Department of Energy: ARRA - Electricity Delivery and Reliability, Research, Development and Analysis Total U.S. Department of Energy U.S. Department of Labor:
WIA Cluster
Pass-through Program From:
Mississippi Department of Employment Services WIA Dislocated Workers Adult Ready Program South Mississippi Planning & Development District WIA Dislocated Worker Formula Grants WIA Pilots, Demonstrations, & Research Projects Total WIA Cluster H-IB Job Training Grants Total Department of Labor Federal
CFDA
Number
Pass-through
Entity Identifying
Number
Federal
Expenditures
ARRA 81.122
239.247
239.247
17.260
17.258,259,278
232,770
2,237
17.278
17.261
17.268
134,013
332,579
701,599
1,013,175
1,714,774
U.S. Department of the Interior:
Coastal Impact Assistance Program (CIAP) Total Department of the Interior 15.426
61,879
61,879
U.S. Department of Commerce:
Pass-through Program From:
Mississippi Technology Alliance - Manufacturing
Extension Partnership
Economic Development Administration GrantInvestments for Public Works & Economic Development Facilities
Total Department of Commerce
11.611
95,025
11.300
998)11
1,093,236
16.738
16.607
7,850
4,323
12,173
97.036
89,534
97 .047
89,950
179,484
94.005
600
U.S. Department of Justice:
Pass-through Program From:
Mississippi Department of Public Safety
Edward Byrne Memorial Justice Assistance
Grant Program
Bulletproof Vest Partnership Program Total U.S. Department of Justice U.S. Department of Homeland Security:
Disaster Grants - Public Assistance (presidentially Declared
Disasters)
Pass-through Program From:
MS Emergency Management Agency - Pre-Disaster Mitigation
Total U.S. Department of Homeland Security
Corporation for National and Community Service:
Learn and Serve America Higher Education
Total Other Programs
Total Expenditures of Federal Awards
4,658,360
$ 41.373,273
33
Mississippi Gulf Coast Community College Schedule of Expenditures of Federal Awards For the Year Ended June 30, 2012 Notes to Schedule of Expenditures of Federal Awards
This schedule was prepared using the same basis of accounting and the same significant policies, as
applicable, used for the general purpose financial statements, with the following exceptions:
(1) For purposes of this schedule, loans made to students under the Federal Direct Student Loans
Program (CFDA #84.268) are presented as federal expenditures. The outstanding loan balance is
included in the financial statements since the loans are made and subsequently collected by private
lending institutions and/or the federal government.
CULUMBER, HARVEY
& ASSOCIATES, P.A.
Certified Public Accountants and Consultants
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENTA UDITING STANDARDS
Dr. Mary Graham, President
and Board of Trustees
Mississippi Gulf Coast Community College
Perkinston, Mississippi
We have audited the financial statements of the business-type activities of Mississippi Gulf Coast
Community College, as of and for the year ended June 30, 2012, as listed in the table of contents and
have issued our report thereon dated December 14, 2012. We conducted our audit in accordance
with auditing standards generally accepted in the United States of America and the standards
applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. The financial statements of the Mississippi Gulf Coast
Community College, Foundation, Inc. were not audited in accordance with Government Auditing
Standards.
Internal Control over Financial Reporting
In planning and performing our audit, we considered Mississippi Gulf Coast Community College's
internal control over financial reporting as a basis for designing our auditing procedures for the
purpose of expressing our opinions on the financial statements, but not for the purpose of expressing
an opinion on the effectiveness of Mississippi Gulf Coast Community College's internal control over
financial reporting. Accordingly, we do not express an opinion on the effectiveness of the
Mississippi Gulf Coast Community College's internal control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent,
or detect and correct misstatements on a timely basis . A material weakness is a deficiency, or a
combination of deficiencies, in internal control such that there is a reasonable possibility that a
material misstatement of the entity's financial statements will not be prevented, or detected and
corrected on a timely basis .
Our consideration of internal control over financial reporting was for the limited purpose described in
the first paragraph of this section and was not designed to identify all deficiencies in internal control
over financial reporting that might be deficiencies, significant deficiencies, or material weaknesses.
We did not identify any deficiencies in internal control over financial reporting that we consider to be
material weaknesses, as defined above.
35
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Mississippi Gulf Coast Community
College's financial statements are free of material misstatement, we performed tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements,
noncompliance with which could have a direct and material effect on the determination of financial
statement amounts. However, providing an opinion on compliance with those provisions was not an
objective of our audit, and accordingly, we do not express such an opinion. The results of our tests
disclosed no instances of noncompliance or other matters that are required to be reported under
Government Auditing Standards.
This report is intended solely for the information and use of the institution, Members of the
Legislature, entities with accreditation overview, federal awarding agencies and pass-through entities
and is not intended to be and should not be used by anyone other than these specified parties.
However, this report is a matter of public record and its distribution is not limited.
Gulfport, MS
December 14,2,012
CULUMBER, HARVEY
& ASSOCIATES, P.A.
Certified Public Accountants and Consultants
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH REQUIREMENTS THAT COULD HAVE A DIRECT AND MATERIAL EFFECT ON EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 Dr. Mary Graham, President
and Board of Trustees
Mississippi Gulf Coast Community College
Perkinston, Mississippi
Compliance
We have audited Mississippi Gulf Coast Community College's compliance with the types of
compliance requirements described in the OMB Circular A-i33 Compliance Supplement that
could have a direct and material effect on each of Mississippi Gulf Coast Community College's
major federal programs for the year ended June 30, 2012. Mississippi Gulf Coast Community
College's major federal programs are identified in the summary of auditor's results section of the
accompanying schedule of findings and questioned costs. Compliance with the requirements of
laws, regulations, contracts, and grants applicable to each of its major federal programs is the
responsibility of Mississippi Gulf Coast Community College's management. Our responsibility
is to express an opinion on Mississippi Gulf Coast Community College's compliance based on
our audit.
We conducted our audit of compliance in accordance with aUditing standards generally accepted
in the United States of America; the standards applicable to financial audits contained in
Government Auditing Standards, issued by the Comptroller General of the United States; and
OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations.
Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain
reasonable assurance about whether noncompliance with the types of compliance requirements
referred to above that could have a direct and material effect on a major federal program
occurred. An audit includes examining, on a test basis, evidence about Mississippi Gulf Coast
Community College's compliance with those requirements and performing such other procedures
as we considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion. Our audit does not provide a legal determination of Mississippi
Gulf Coast Community College's compliance with those requirements.
In our opinion, Mississippi Gulf Coast Community College complied, in all material respects,
with the compliance requirements referred to above that could have a direct and material effect
on each of its major federal programs for the year ended June 30, 2012.
37
Internal Control over Compliance
Management of Mississippi Gulf Coast Community College is responsible for establishing and
maintaining effective internal control over compliance with the requirements of laws,
regulations, contracts, and grants applicable to federal programs. In planning and performing our
audit, we considered Mississippi Gulf Coast Community College's internal control over
compliance with the requirements that could have a direct and material effect on a major federal
program to determine the auditing procedures for the purpose of expressing 'our opinion on
compliance and to test and report on internal control over compliance in accordance with OMB
Circular A-133, but not for the of expressing an opinion on the effectiveness of internal control
over compliance. Accordingly, we do not express an opinion on the effectiveness of Mississippi
Gulf Coast Community College's internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control
over compliance does not allow management or employees, in the normal course of performing
their assigned functions, to prevent, or detect and correct, noncompliance with a type of
compliance requirement of a federal program on a timely basis. A material weakness in internal
control over compliance is a deficiency, or combination of deficiencies, in internal control over
compliance, such that there is a reasonable possibility that material noncompliance with a type of
compliance requirement of a federal program will not be prevented, or detected and corrected, on
a timely basis.
Our consideration of the internal control over compliance was for the limited purpose described in
the first paragraph of this section and was not designed to identify all deficiencies in internal control
over compliance that might be deficiencies; significant deficiencies, or material weaknesses. We did
not identify any deficiencies in internal control over compliance that we consider to be material
weaknesses, as defined above.
.
This report is intended solely for the information and use of the institution, Members of the
Legislature, entities with accreditation overview, federal awarding agencies and pass-through entities
and is not intended to be and should not be used by anyone other than these specified parties.
However, this report is a matter of public record and its distribution is not limited.
Gulfport, MS
December 14,2012
CULUMBER, HARVEY
& ASSOCIATES, P.A.
Certified Public Accountants and Consultants
Independent Auditor's Report on Compliance with State Laws and Regulations Dr. Mary Graham, President and
Board of Trustees
Mississippi Gulf Coast Community College
Perkinston, Mississippi
We have audited the financial statements of Mississippi Gulf Coast Community College as of and for
the year ended June 30, 2012, and have issued our report thereon dated December 14, 2012. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing
Standards.
We have also performed procedures to test compliance with certain state laws and regulations.
However, providing an opinion on compliance with state laws and regulations was not an objective
of our audit and, accordingly, we do not express such an opinion.
The results of procedures performed to test compliance with certain other state laws and regulations
and our audit of the financial statements disclosed the following immaterial instances of
noncompliance with other state laws and regulations. Our immaterial finding and recommendation
and your response is as follows:
1. Finding
The following situation came to our attention during the course of our audit of the
Mississippi Gulf Coast Community College:
A. The College did business with a company owned by a board member's parents.
Recommendation
The board should evaluate this situation to determine if there is a violation of the ethics
laws.
College's Response
The College's legal counsel will request guidance from the Ethics Commission and the
Attorney General's Office to determine if any violations have been committed and the
appropriate remedies available.
39
This report is intended solely for the infonnation and use of management, entities with accreditation
overview, and federal awarding agencies and pass-through entities and is not intended to be and
should not be used by anyone other than these specified parties. However, this report is a matter of
public record and its distribution is not limited.
CuJumber, Harvey & Associates, P.A.
December 14,2012
40
Mississippi Gulf Coast Community College Schedule of Findings and Questioned Costs For the Year Ended June 30, 2012 Section 1: Summary of Auditor's Results
Financial Statements,'
1. Type of auditor's report issued on the financial statements:
2. Material noncompliance relating to the financial statements?
3. Internal control over financial reporting:
a. Material weakness(es) identified?
b. Significant deficiency(ies) identified that are not considered to be
material weakness( es)
Unqualified
No
No
None Reported
Federal Awards:
4. Type of auditor's report issued on compliance for major federal programs:
5. Internal control over major programs:
a. Material weakness(es) identified?
b. Significant deficiency(ies) identified that are not considered to be
material weaknesses?
6. Any audit finding(s) reported as required by Section_.510(a) of Circular A-I33?
7. Federal programs identified as major programs:
a. Student Financial Aid Cluster: CFDA#: 84.063 CFDA#: 84.375 CFDA#: 84.007 CFDA#: 84.268 CFDA#: 84.033 b. Department of Commerce: CFDA#: 11.300 c. Department of Education: CFDA#: 84.002 CFDA#: 84.048 d. Department of Labor: CFDA#: 17.261 Unqualified No
None Reported
No 41
Mississippi Gulf Coast Community Colleg~
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2012
8. The dollar threshold used to distinguish between type A and type, B
programs:
$300,000
9. Auditee qualified as a low-risk auditee?
No
10. Prior fiscal year audit finding(s) and questioned cost relative to
federal awards which would require the auditee to prepare a summary
schedule of prior audit findings as discussed in Section_.3I5(b) of
OMB Circular A-I33?
Yes
Section 2: Financial Statement Findings
None
Section 3: Federal Award Findings and Questioned Costs
None
42
Mississippi Gulf Coast Community College Summary Schedule of Prior Year Audit Findings For the Year Ended June 30,2012
Summary Schedule of Prior Year Audit Findings
2011-1
Federal Direct Student Loans-CFDA No.84.268
Statement of Condition: Computer software used to determine subsidized loan amounts was overwritten for two selected students. Recommendation: Mississippi Gulf Coast Community College should contact the lending agency to reclassify the loans as unsubsidized. Current Status: The recommendation was adopted by the College. No similar findings were noted in the 2012 audit.