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Course En Ligne Geant Casino Montpellier
Academy of Flint
Flint, Michigan
Annual Financial Statements
and
Auditors’ Report
June 30, 2011
Table of Contents
Section
Page
1
Members of the Board of Directors and Administration
1-1
2
Independent Auditors’ Report
2-1
3
Management’s Discussion and Analysis
3-1
4
Basic Financial Statements
Academy-wide Financial Statements
Statement of Net Assets
Statement of Activities
Fund Financial Statements
Governmental Funds
Balance Sheet
Reconciliation of the Balance Sheet of
Governmental Funds to the Statement of Net Assets
Statement of Revenues, Expenditures and Changes in Fund Balances
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the Statement of Activities
Notes to Financial Statements
5
4-3
4-4
4-5
4-6
4-7
Required Supplemental Information
Budgetary Comparison Schedule – General Fund
6
4-1
4-2
5-1
Other Supplemental Information
General Fund
Comparative Balance Sheet
Schedule of Revenues Compared to Budget
Schedule of Expenditures Compared to Budget
6-1
6-2
6-3
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
6 - 11
Academy of Flint
Members of the Board of Directors and Administration
June 30, 2011
Members of the Board of Directors
Daniel Hall
President
Samuel Warren
Vice President
Yolanda Urquhart-Williams
Treasurer/Secretary
Administration
Elnora Crutchfield
Chief Administrative Officer
April Jackson
Chief Financial Officer
1-1
4468 Oak Bridge Drive
Flint, MI 48532
Phone (810) 732-3000 / (800) 899-4742
Fax (810) 732-6118
Independent Auditors’ Report
To the Board of Directors
Academy of Flint
Flint, Michigan
We have audited the accompanying financial statements of the governmental activities, each major fund and the aggregate
remaining fund information of the Academy of Flint as of and for the year ended June 30, 2011, which collectively comprise the
Academy’s basic financial statements as listed in the table of contents. These financial statements are the responsibility of Academy
of Flint’s management. Our responsibility is to express opinions 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.
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 respective financial position of the
governmental activities, each major fund, and the aggregate remaining fund information of Academy of Flint as of June 30, 2011, and
the respective changes in financial position for the year then ended, in conformity with accounting principles generally accepted in
the United States of America.
As discussed in Note 1 to the financial statements, the Entity adopted the provisions of GASB Statement No. 54, Fund Balance
Reporting and Governmental Fund Type Definition, during the year ended June 30, 2011.
In accordance with Government Auditing Standards, we have also issued a report dated October 10, 2011, on our consideration of
the Academy of Flint’s internal control over financial reporting and on 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 of our testing of
internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal
control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with
Governmental Auditing Standards and should be considered in assessing the results of our audit.
2-1
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and
budgetary comparison information identified in the table of contents be presented to supplement the basic financial statements. Such
information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who
considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational,
economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance
with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the
methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries,
the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not
express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient
evidence to express an opinion or provide any assurance.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Academy of
Flint's financial statements as a whole. The accompanying other supplemental information listed in the table of contents is presented
for purposes of additional analysis and is not a required part of the financial statements. Such information is the responsibility of
management and, other than the prior year information, was derived from and relates directly to the underlying accounting and other
records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit
of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the
underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and
other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our
opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.
We also have previously audited, in accordance with auditing standards generally accepted in the United States, the Academy of
Flint’s financial statements for the year ended June 30, 2010, which are not presented with the accompanying financial statements.
In our report dated November 3, 2010, we expressed unqualified opinions on the respective financial statements of the governmental
activities, each major fund, and the aggregate remaining fund information. That audit was conducted for the purpose of forming
opinions on the financial statements that collectively comprise the Academy of Flint‘s financial statements as a whole. The 2010
information in the comparative statements is presented for purposes of additional analysis and is not a required part of the financial
statements. Such information is the responsibility of management and was derived from and relates directly to the underlying
accounting and other records used to prepare the 2010 financial statements. The information has been subjected to the auditing
procedures applied in the audit of those financial statements and certain additional procedures, including comparing and reconciling
such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial
statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United
States of America. In our opinion, the 2010 information in the comparative statements is fairly stated in all material respects in
relation to the financial statements from which they have been derived.
Flint, Michigan
October 10, 2011
2-2
MANAGEMENT’S DISCUSSION AND ANALYSIS
Academy of Flint
Management’s Discussion & Analysis
June 30, 2011
Within this section of the Academy of Flint's annual financial report, the Academy’s management is providing a narrative discussion
and analysis of the financial activities of the Academy for the fiscal year that has ended on June 30, 2011. This narrative discusses
and analyzes the activity within the context of the accompanying financial statements and disclosures following this section.
Overview of the Financial Statements
Management’s Discussion and Analysis introduces the Academy’s basic financial statements. The basic financial statements include
the following: 1) government-wide financial statements, 2) fund financial information, 3) notes to the financial statements. The
Academy also includes in this report additional information to supplement the basic financial statements.
Government-Wide Financial Statements
The Government-Wide Financial Statements are designed to provide the reader a broad overview of the Academy’s finances.
Although this is a government entity, the manner in which they are presented is similar to a private-sector business.
The statement of net assets presents information on all of the Academy’s assets and liabilities, with the difference between the two
reported as net assets. As the Academy continues to operate, increases and decreases in net assets will occur and may serve as a
useful indicator of whether the financial position of the Academy is improving or deteriorating.
The statement of activities demonstrates information on how the Academy’s net assets changed during the current fiscal year. The
design of this statement is to show the financial reliance of the Academy’s distinct activities or functions on the revenues generated
by the Academy.
Both government-wide financial statements distinguish governmental activities of the Academy that are intended to recover all or a
significant portion of their costs through contributions, user fees, and charges. The Academy’s financial reporting includes all the
funds that the Academy is accountable for.
Fund Financial Statements
A fund is an accountable unit used to maintain control over resources segregated for specific activities or objectives. The Academy
uses funds to ensure and demonstrate compliance with finance-related laws and regulation.
3-1
Academy of Flint
Management’s Discussion & Analysis
June 30, 2011
The Academy's fund financial statements provide detailed information about the most significant funds - not the Academy as a whole.
Some funds are required to be established by state law and by bond covenants. However, the Academy establishes many other
funds to help it control and manage money for particular purposes or to show that it is meeting legal responsibilities for using grants
and other money. All of the Academy's services are reported in governmental funds. Governmental funds are reported in the
financial statements and encompass essentially the same functions as governmental activities in the government-wide financial
statements except with a different focus on the financial activity. These statements report short-term fiscal accountability focusing on
the use of spendable resources and balances of these resources available at the end of the year. They are useful in evaluating
annual financing requirements of governmental programs and the commitment of spendable resources for the near-term. Since the
focus of the government-wide financial statements includes a long-term view, a reconciliation of these fund balances has been
completed to detail it’s relation to net assets.
Notes to the Financial Statement
The accompanying notes to the Financial Statements provide information essential to a full understanding of both the governmentwide and fund financial statements.
Other information
This report includes Statement of Net Assets. Along with the Assets, this statement includes all liabilities both current and noncurrent of the Academy.
In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary
information.
Other supplementary information includes detail by fund for receivables, payables, transfers and payments within the reporting entity.
Financial Analysis of the Academy as a Whole
The Academy’s net assets at the end of the fiscal year 2011 were $ 1,821,704. This is a $ 391,315 increase over the 2010 fiscal
year that ended at $ 1,430,389.
3-2
Academy of Flint
Management’s Discussion & Analysis
June 30, 2011
The following tables provide a summary of the Academy’s financial activities in the net assets:
Summary of Net Assets
Governmental Activities
2010
2011
Assets
Current and other assets
$ 1,857,140
$ 1,772,620
599,921
399,074
2,457,061
2,171,694
Liabilities - Current liabilities
635,357
741,305
Net Assets
Invested in capital assets
599,921
399,074
1,221,783
1,031,315
$ 1,821,704
$ 1,430,389
Capital assets
Total assets
Unrestricted
Total net assets
3-3
Academy of Flint
Management’s Discussion & Analysis
June 30, 2011
Summary of Changes in Net Assets
Governmental Activities
2011
2010
Revenue
Program revenue:
Charges for services
Operating grants
Capital grants
General revenue:
State grants
Other
$
Total revenues
Functions/Program Expenses
Instruction
Support services
Community services
Food services
Total functions/program expenses
Increase in Net Assets
$
3-4
41,479
1,237,771
14,105
$
3,840
1,599,324
18,896
3,869,219
3,502
3,841,103
10,330
5,166,076
5,473,493
1,922,644
2,506,152
34,640
311,325
2,776,072
2,222,489
33,253
327,619
4,774,761
5,359,433
391,315
$
114,060
Academy of Flint
Management’s Discussion & Analysis
June 30, 2011
Financial Analysis of the Academy’s Funds
The Academy uses funds to help it control and manage money for particular purposes. Looking at funds helps the reader consider
whether the Academy is being accountable for the resources the State and others provide to it and may provide more insight into the
Academy's overall financial health.
As the Academy completed this year, the governmental funds reported a combined fund balance of $ 1,221,783, which is an
increase of $ 290,818 from last year.
General Fund fund balance is available to fund costs related to allowable school operating purposes.
Our Special Revenue Fund remain the same as prior years, in that it maintains a $ 0 fund balance. Excess of expenditures over
revenues are funded through a fund balance transfer from the General Fund.
General Fund Budgetary Highlights
Over the course of the year, the Academy revises its budget as it attempts to deal with unexpected changes in revenues and
expenditures. State law requires that the budget be amended to ensure that expenditures do not exceed appropriations. The final
amendment for the budget was adopted just before year end. A schedule showing the Academy's original and final budget amounts
compared with amounts actually paid and received is provided in the required supplemental information to these financial
statements.
3-5
Academy of Flint
Management’s Discussion & Analysis
June 30, 2011
Capital Asset and Debt Administration
As of June 30, 2011, the Academy had approximately $ 1,209,653 invested in capital assets, including construction in progress,
building improvements, portable classrooms, and furniture and equipment. This amount represents a net decrease of $ 289,276.
2011
Construction in progress
Building improvements
Portable classrooms
Furniture and equipment
Total capital assets
2010
$
18,695
277,848
279,330
633,780
$
622,986
279,330
596,613
$
1,209,653
$
1,498,929
No debt was issued for the current year additions; the General Fund balance was sufficient to cover these additions.
At the end of the current year, the Academy did not have any outstanding debt other than normal trade payables, which are recorded
on an accrual basis.
Economic Conditions and Future Activities
Approximately 80 percent of the Academy's total General Fund revenue is from the State of Michigan. As a result, the Academy
funding is heavily dependent on the State's ability to fund local school operations. Based on early enrollment data at the start of the
2011 school year, we anticipate that the fall student count will be in excess of the estimates used in creating the 2012 budget. Once
the final student count and related per pupil funding is validated, state law requires the Academy to amend the budget if actual
Academy resources are not sufficient to fund original appropriations.
Since the Academy's revenue is heavily dependent on state funding and the health of the State's School Aid Fund, the actual
revenue received depends on the State's ability to collect revenues to fund its appropriation to academies. The State periodically
holds a revenue-estimating conference to estimate revenues. If the State estimates funds are not sufficient to fund the appropriation,
the legislature must revise the appropriation or proration of state aid will occur. The impact on the Academy of the State's projected
revenue shortfall is not known.
3-6
Academy of Flint
Management’s Discussion & Analysis
June 30, 2011
Contacting the Academy’s Financial Management
This report was designed to provide a general overview of the Academy’s financial position and comply with finance-related
regulations. If you have any further questions about this report or request additional information, please contact the Academy of Flint
at 4058 North Linden Road, Suite F, Flint, Michigan 48504.
3-7
BASIC FINANCIAL STATEMENTS
Academy of Flint
Statement of Net Assets
June 30, 2011
Governmental
Activities
Assets
Cash
Accounts receivable
Due from other governmental units
Prepaid items
Capital assets not being depreciated
Capital assets - net of accumulated depreciation
$
811,922
12,762
979,243
53,213
18,695
581,226
2,457,061
Total assets
Liabilities
Accounts payable
Accrued expenditures
Accrued salaries payable
Deferred revenue
126,329
349,517
8,041
151,470
Total liabilities
635,357
Net Assets
Invested in capital assets
Unrestricted
599,921
1,221,783
$
Total net assets
See Accompanying Notes to Financial Statements
4-1
1,821,704
Academy of Flint
Statement of Activities
For the Year Ended June 30, 2011
Program Revenues
Charges for
Services
Expenses
Functions/Programs
Governmental activities
Instruction
Supporting services
Food services
Community services
Total governmental activities
Operating
Grants and
Contributions
Net (Expense)
Revenue and
Changes in
Net Assets
Capital
Grants and
Contributions
$
1,922,644
2,506,152
311,325
34,640
$
38,039
3,440
-
$
915,121
46,230
276,420
-
$
14,105
-
$
4,774,761
$
41,479
$
1,237,771
$
14,105
$
(3,481,406)
General revenues
State aid - unrestricted
Other
3,869,219
3,502
3,872,721
Total general revenues
Change in net assets
391,315
1,430,389
Net assets - beginning
Net assets - ending
See Accompanying Notes to Financial Statements
4-2
(969,484)
(2,459,922)
(17,360)
(34,640)
$
1,821,704
Academy of Flint
Governmental Funds
Balance Sheet
June 30, 2011
Nonmajor
Governmental
Funds
General
Fund
Assets
Cash
Accounts receivable
Due from other funds
Due from other governmental units
Prepaid items
Total assets
Liabilities and Fund Balance
Liabilities
Accounts payable
Due to other funds
Accrued expenditures
Accrued salaries payable
Deferred revenue
$
811,922
12,762
979,243
53,213
$
-
$
811,922
12,762
979,243
53,213
$
1,857,140
$
-
$
1,857,140
$
126,329
349,517
8,041
151,470
$
-
$
126,329
349,517
8,041
151,470
Total liabilities
Fund Balance
Non-spendable
Prepaid items
Unassigned
Total fund balance
Total liabilities and fund balance
Governmental
Activities
$
635,357
-
635,357
53,213
1,168,570
-
53,213
1,168,570
1,221,783
-
1,221,783
1,857,140
See Accompanying Notes to Financial Statements
4-3
$
-
$
1,857,140
Academy of Flint
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets
June 30, 2011
Total fund balances for governmental funds
$ 1,221,783
Total net assets for governmental activities in the statement of net assets is different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds.
Capital assets not being depreciated
Capital assets - net of accumulated depreciation
18,695
581,226
$ 1,821,704
Net assets of governmental activities
See Accompanying Notes to Financial Statements
4-4
Academy of Flint
Governmental Funds
Statement of Revenues, Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2011
Nonmajor
Governmental
Funds
General
Fund
Revenues
Local sources
State sources
Federal sources
Interdistrict sources
$
41,541
3,958,851
945,973
26,096
$
3,440
8,200
282,325
-
Total
Governmental
Funds
$
44,981
3,967,051
1,228,298
26,096
4,972,461
293,965
5,266,426
Expenditures
Current
Education
Instruction
Supporting services
Food services
Community services
Capital outlay
1,912,516
2,456,249
34,640
267,077
305,126
-
1,912,516
2,456,249
305,126
34,640
267,077
Total expenditures
4,670,482
305,126
4,975,608
Total revenues
301,979
(11,161)
290,818
(11,161)
11,161
-
11,161
(11,161)
Total other financing sources (uses)
(11,161)
11,161
-
Net change in fund balance
290,818
-
290,818
930,965
-
930,965
Excess (deficiency) of revenues over expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Fund balance - beginning
Fund balance - ending
$
1,221,783
See Accompanying Notes to Financial Statements
4-5
$
-
$
1,221,783
Academy of Flint
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances
of Governmental Funds to the Statement of Activities
For the Year Ended June 30, 2011
Net change in fund balances - Total governmental funds
$
290,818
Total change in net assets reported for governmental activities in the statement of activities
is different because:
Revenues in the statement of activities that do not provide current financial resources are not reported as
revenue in the funds.
Operating grants
(100,350)
Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of
those assets is allocated over their estimated useful lives and reported as depreciation expense.
Depreciation expense
Capital outlay
Change in net assets of governmental activities
See Accompanying Notes to Financial Statements
4-6
(94,958)
295,805
$
391,315
Academy of Flint
Notes to Financial Statements
June 30, 2011
The statement of net assets presents governmental activities on a
consolidated basis, using the economic resources measurement
focus and accrual basis of accounting.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the Academy of Flint (Academy) conform
to accounting principles generally accepted in the United States of
America as applicable to governmental units. The following is a
summary of the Academy’s significant accounting policies:
The statement of activities reports both the gross and net cost of
each of the Academy’s functions. The functions are also supported
by general government revenues (certain intergovernmental
revenues, investments and earnings, etc.).
The statement of
activities reduces gross expenses (including depreciation) by related
program revenues, operating and capital grants. Program revenues
must be directly associated with the function. Operating grants
include operating-specific and discretionary (either operating or
capital) grants.
Reporting Entity
The Academy was established on July 13, 1999 as a public school
academy pursuant to the Michigan School Code of 1976, as
amended, and administered by Central Michigan University. The
original charter was renewed July 1, 2010. The Academy is located
in the Flint area providing education for approximately 544 students
from kindergarten through grade eight.
The net costs (by function) are normally covered by general revenue
(state sources and federal sources, interest income, etc.). In creating
the Academy-wide financial statements the Academy has eliminated
interfund transactions.
Academy of Flint was organized on a non-stock, directorship basis,
as a Michigan nonprofit corporation.
The Academy-wide focus is on the sustainability of the Academy as
an entity and the change in the Academy’s net assets resulting from
current year activities.
The accompanying basic financial statements have been prepared in
accordance with criteria established by the Governmental Accounting
Standards Board for determining various governmental organizations
to be included in the reporting entity. These criteria include
significant operational or financial relationships with the Academy.
Based on application of the criteria, the Academy does not contain
component units.
Fund Financial Statements
Academy-wide Financial Statements
Separate financial statements are provided for governmental funds.
Major individual governmental funds are reported as separate
columns in the fund financial statements.
The Academy’s basic financial statements include both Academywide (reporting for the Academy as a whole) and fund financial
statements (reporting the Academy’s major funds). The Academywide financial statements categorize all nonfiduciary activities as
either governmental or business type. All of the Academy’s activities
are classified as governmental activities.
Governmental fund financial statements are reported using the
current financial resources measurement focus and the modified
accrual basis of accounting. Revenue is recognized as soon as it is
both measurable and available. Revenue is considered to be
available if it is collected within the current period or soon enough
thereafter to pay liabilities of the current period. For this purpose, the
4-7
Academy of Flint
Notes to Financial Statements
June 30, 2011
Receivables and Payables – Generally, outstanding amounts owed
between funds are classified as “due from/to other funds”. These
amounts are caused by transferring revenues and expenses between
funds to get them into the proper reporting fund. These balances are
paid back as cash flow permits.
Academy considers revenues to be available if they are collected
within 60 days of the end of the current fiscal period. Expenditures
generally are recorded when a liability is incurred, as under accrual
accounting.
However, debt service expenditures, as well as
expenditures related to compensated absences and claims and
judgments, are recorded only when payment is due.
Prepaid Items – Certain payments to vendors reflect costs applicable
to future fiscal years. For such payments in governmental funds the
Academy follows the purchase method, and they therefore are
expensed when paid in both the Academy-wide and fund financial
statements.
Unrestricted state aid, intergovernmental grants, and interest
associated with the current fiscal period are all considered to be
susceptible to accrual and so have been recognized as revenue of
the current fiscal period. All other revenue items are considered to
be available only when cash is received by the government.
Capital Assets – capital assets, which include building improvements,
portable classrooms, equipment and furniture, are reported in the
applicable governmental column in the Academy-wide financial
statements. The Academy defines capital assets as assets with an
initial individual cost in excess of $1,000 and an estimated useful life
in excess of 3 years. Such assets are recorded at historical cost or
estimated historical cost if purchased or constructed. Donated
capital assets are recorded at estimated fair market value at the date
of donation. Costs of normal repair and maintenance that do not add
to the value or materially extend asset lives are not capitalized. The
Academy does not have infrastructure assets.
The Academy reports the following major governmental funds:
General Fund – The General Fund is used to record the general
operations of the Academy pertaining to education and those
operations not required to be provided for in other funds.
Additionally, the Academy reports the following fund types:
Special Revenue Funds – Special Revenue Funds are used to
account for the proceeds of specific revenue sources that are
restricted to expenditures for specified purposes. The Academy’s
Special Revenue Fund is the Food Service Fund.
Leasehold improvements, portable classrooms, and equipment and
furniture are depreciated using the straight-line method over the
following useful lives:
Assets, Liabilities and Equity
Deposits – Cash includes cash on hand and demand deposits.
Leasehold improvements
Portable classrooms
Equipment and furniture
4-8
20-50 years
20-50 years
3-10 years
Academy of Flint
Notes to Financial Statements
June 30, 2011
Eliminations and Reclassifications
Fund Equity – In the fund financial statements, governmental funds
report fund balance in the following categories:
In the process of aggregating data for the statement of net assets
and the statement of activities, some amounts reported as interfund
activity and balances in the funds were eliminated or reclassified.
Interfund receivables and payables were eliminated to minimize the
"grossing up" effect on assets and liabilities within the governmental
activities column.
Non-spendable - assets that are not available in a spendable
form.
Restricted – amounts that are legally imposed or otherwise
required by external parties to be used for a specific purpose.
Economic Dependency
Committed – amounts constrained on use imposed by the
District’s highest level of decision-making, its board of
education. A fund balance commitment may be established,
modified, or rescinded by a resolution of the board of
education.
The Academy received approximately 80% of their General Fund
revenue from the Michigan Department of Education. Due to the
significance of this revenue source, the Academy is considered to be
economically dependent on the Michigan Department of Education.
Assigned – amounts intended to be used for specific
purposes, as determined by the board of education. Residual
amounts in governmental funds other than the general fund
are automatically assigned by their nature.
Adoption of New Accounting Standard
The Government Accounting Standards Board issued Statement
No. 54, Fund Balance Reporting and Governmental Fund Type
Definitions, which the District adopted effective July 1, 2010. The
new standard changes fund balance classifications to depict the
relative strength of the spending constraints and clarifies the
definitions of various governmental fund types. The standard
includes a new definition of special revenue funds, and athletic funds
no longer meet that definition. As a result, balances and activities
previously reported under the athletic fund are combined with the
general fund.
Unassigned – all other resources; the remaining fund
balances after non-spendable, restrictions, commitments and
assignments.
When expenditure is incurred for purposes for which both restricted
and unrestricted fund balance is available, the Academy’s policy is to
consider restricted funds spent first.
When expenditure is incurred for purposes for which committed,
assigned, or unassigned amounts could be used, the District’s policy
is to consider the funds to be spent in the following order: (1)
committed, (2) assigned, (3) unassigned.
4-9
Academy of Flint
Notes to Financial Statements
June 30, 2011
Excess of Expenditures over Appropriations
NOTE 2 - STEWARDSHIP, COMPLIANCE, AND
ACCOUNTABILITY
The Academy’s significant expenditure budget variances are as
follows:
Budgetary Information
Annual budgets are adopted on a basis consistent with accounting
principles generally accepted in the United States of America and
state law for the General and Special Revenue Funds. All annual
appropriations lapse at fiscal year end, thereby cancel all
encumbrances. These appropriations are reestablished at the
beginning of the year.
Final
Budget
Function
General Fund
Pupil
Instructional staff
School administration
The budget document presents information by fund and function.
The legal level of budgetary control adopted by the governing body is
the function level. State law requires the Academy to have its budget
in place by July 1. The Academy is not considered in violation of the
law if reasonable procedures are in use by the Academy to detect
violations.
$
198,783
278,774
271,117
Budget
Variances
Over
(Under)
Amount of
Expenditures
$
202,370
303,450
271,499
$
3,587
24,676
382
NOTE 3 - DEPOSITS AND INVESTMENTS
The Academy’s deposits and investments were reported in the basic
financial statements in the following categories:
The Chief Administrative Officer is authorized to transfer budgeted
amounts within functions in any fund; however, any revisions that
alter the total expenditures of any fund must be approved by the
Board of Directors.
Total
Primary
Government
Governmental
Activities
Cash
$
811,922
$
811,922
Interest rate risk – The Academy does not have a formal investment
policy to manage its exposure to fair value losses arising from
changes in interest rates.
Budgeted amounts are as originally adopted or as amended by the
Board of Directors throughout the year. Individual amendments were
not material in relation to the original appropriations.
Credit risk – State statutes authorize the Academy to make deposits
in the accounts of federally insured banks, credit unions, and savings
and loan associations that have an office in Michigan; the Academy
is allowed to invest in U.S. Treasury or Agency obligations, U.S.
government repurchase agreements, bankers’ acceptances,
commercial paper rated prime at the time of purchase that matures
not more than 270 days after the date of purchase, mutual funds, and
4 - 10
Academy of Flint
Notes to Financial Statements
June 30, 2011
investment pools that are composed of authorized investment
vehicles. The Academy has no investment policy that would further
limit its investment choices.
Depreciation expense for the fiscal year end amounted to $ 94,958.
The Academy allocated depreciation to the various governmental
funds as follows:
Concentration of credit risk – The Academy has no policy that would
limit the amount that may be invested with any one issuer.
Governmental activities
Instruction
Support services
Food services
Custodial credit risk – deposits – In the case of deposits, this is the
risk that in the event of a bank failure, the Academy’s deposits may
not be returned to it. The Academy does not have a deposit policy
for custodial credit risk. As of year end, $ 639,808 of the Academy’s
bank balance of $ 892,834 was exposed to custodial credit risk
because it was uninsured and uncollateralized.
Total governmental activities
Decreases
Governmental funds report deferred revenue in connection with
receivables for revenue that is not considered to be available to
liquidate liabilities of the current period. Governmental funds also
defer revenue recognition in connection with resources that have
been received but not yet earned. At the end of the current fiscal
year, the Academy reported deferred revenue as follows:
Balance
Governmental activities
Capital assets not being depreciated
Construction in progress
$
-
$
18,695
$
$
-
$
-
$
94,958
NOTE 6 - DEFERRED REVENUE
Ending
Increases
$
Interfund transfers were made during the year from the General Fund
to the Food Service fund in the amount of $11,161.
A summary of the changes in governmental capital assets is as
follows:
Bal ance
38,856
49,903
6,199
NOTE 5 - TRANSFERS
NOTE 4 - CAPITAL ASSETS
Beginning
$
18,695
Capital assets being depreciated
345,138
$ 277,848
Portable classrooms
Leasehold improvements
279,330
-
-
279,330
Equipm ent and furniture
596,613
37,167
-
633,780
Total capital assets being depreciated
1,498,929
37,167
345,138
1,190,958
Less accum ulated depreciation
1,099,855
94,958
585,081
609,732
Net capital assets
$ 622,986
$ 399,074
$
(39,096)
$
(239,943)
Unearned
Grant and state aid revenue recognized as
receivable but not received until after 60 days
$ 599,921
4 - 11
$
151,470
Academy of Flint
Notes to Financial Statements
June 30, 2011
NOTE 7 - RISK MANAGEMENT
NOTE 9 – RELATED PARTY
The Academy is exposed to various risks of loss related to property
loss, torts, errors and omissions, employee injuries (workers’
compensation) and certain medical benefits provided to employees.
The Academy has purchased commercial insurance for all other
claims. Settled claims relating to commercial insurance have not
exceeded the amount of coverage since inception.
All of the personnel of the Academy are employed by MEP Services.
The Academy makes contributions to a defined contribution pension
plan administered by MEP Services who leases employees to the
Academy. The Academy matches 100% of employee contributions
up to 3% of gross wages. Total contributions for the year ended June
30, 2011 was $5,796.
The Academy is subject to the Michigan Employment Security Act
and has elected to pay unemployment claims on a direct self-insured
basis. Under this method, the Academy must reimburse the
Employment Commission for all benefits charged against the
Academy for the year.
The Academy had $115,677 of
unemployment compensation expense for the year. No provision has
been made for possible future claims.
NOTE 10 - CONTINGENT LIABILITIES
Amounts received or receivable from grantor agencies are subjected
to audit and adjustment by grantor agencies, principally the federal
government. Any disallowed claims, including amounts already
collected, may constitute a liability of the applicable funds. The
amount, if any, of costs which may be disallowed by the grantor
cannot be determined at this time although the Academy expects
such amounts, if any, to be immaterial. A separate report on federal
compliance has been issued for the year June 30, 2011.
NOTE 8 - CAPITAL LEASE
The Academy has entered into a lease for its facility with a Michigan
nonprofit corporation, Academy of America, whose officers are also
The Academy is a defendant in various lawsuits. Although the
outcome of these lawsuits is not presently determinable, in the
opinion of the Academy’s attorneys, the resolution of these matters
will not have a material adverse effect on the financial condition of
the Academy.
stockholders of Charter School Administration Services, Inc., the
previous management agent for the Academy. The lease expired
July 31, 2009 and on August 1, 2009, the lease was renewed at the
existing terms for the following five years.
The future minimum lease payments are $27,318 per month through
July 31, 2014.
4 - 12
REQUIRED SUPPLEMENTAL INFORMATION
Academy of Flint
Required Supplemental Information
Budgetary Comparison Schedule - General Fund
For the Year Ended June 30, 2011
Budgeted Amounts
Original
Revenues
Local sources
State sources
Federal sources
Interdistrict sources
Total revenues
Expenditures
Instruction
Basic programs
Added needs
Supporting services
Pupil
Instructional staff
General administration
School administration
Business
Operations and maintenance
Pupil transportation services
Central
Community services
Capital outlay
Total expenditures
$
4,120
3,952,472
659,195
24,982
Final
$
34,284
4,067,950
882,719
24,982
Over
(Under)
Budget
Actual
$
41,541
3,958,851
945,973
26,096
$
7,257
(109,099)
63,254
1,114
4,640,769
5,009,935
4,972,461
(37,474)
1,546,434
521,672
1,464,456
546,225
1,423,161
489,355
(41,295)
(56,870)
197,715
157,638
512,037
219,647
94,685
875,185
154,000
115,000
39,757
97,000
198,783
278,774
475,186
271,117
124,279
880,380
178,687
105,962
44,577
323,523
202,370
303,450
469,497
271,499
121,720
818,395
166,425
102,893
34,640
267,077
3,587
24,676
(5,689)
382
(2,559)
(61,985)
(12,262)
(3,069)
(9,937)
(56,446)
4,530,770
4,891,949
4,670,482
(221,467)
5-1
Academy of Flint
Required Supplemental Information
Budgetary Comparison Schedule - General Fund
For the Year Ended June 30, 2011
Budgeted Amounts
Original
Excess of revenues over expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balance
Fund balance - beginning
Fund balance - ending
$
Actual
109,999
117,986
301,979
183,993
14,684
-
56,236
(52,772)
(11,161)
(56,236)
41,611
14,684
3,464
(11,161)
(14,625)
124,683
121,450
290,818
169,368
930,965
930,965
930,965
1,055,648
5-2
Final
Over
(Under)
Budget
$
1,052,415
$
1,221,783
$
169,368
OTHER SUPPLEMENTAL INFORMATION
Academy of Flint
Other Supplemental Information
General Fund
Comparative Balance Sheet
June 30, 2011
2011
Assets
Cash
Accounts receivable
Due from other governmental units
Prepaid items
Total assets
Liabilities and Fund Balance
Liabilities
Accounts payable and other liabilities
Accrued expenditures
Accrued salaries payable
Deferred revenue
$
811,922
12,762
979,243
53,213
$
418,317
1,500
1,321,517
31,286
$
1,857,140
$
1,772,620
$
126,329
349,517
8,041
151,470
$
100,436
441,780
28,756
270,683
Total liabilities
Fund Balance
Non-spendable
Prepaid items
Unassigned
Total fund balance
$
Total liabilities and fund balance
6-1
2010
635,357
841,655
53,213
1,168,570
31,286
899,679
1,221,783
930,965
1,857,140
$
1,772,620
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Revenues Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
Revenue from local sources
Earnings on investments
Student activities
Community service activities
Other local revenues
$
1,000
3,000
120
Final
Budget
$
1,200
1,800
31,284
Over
(Under)
Final Budget
Actual
$
1,319
1,805
58
38,359
$
119
5
58
7,075
4,120
34,284
41,541
3,586,756
365,716
3,778,432
289,518
3,869,219
89,632
90,787
(199,886)
3,952,472
4,067,950
3,958,851
(109,099)
659,195
882,719
945,973
63,254
Interdistrict sources
Other
24,982
24,982
26,096
1,114
Other financing sources
Transfers in
14,684
56,236
-
(56,236)
$ 4,655,453
$ 5,066,171
Total revenues from local sources
Revenues from state sources
Grants - unrestricted
Grants - restricted
Total revenues from state sources
Revenues from federal sources
Grants
Total revenue
6-2
$ 4,972,461
7,257
$
(93,710)
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Expenditures Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
Basic program - elementary
Salaries
Employee benefits
Purchased services
Supplies and materials
$
652,528
196,201
28,065
55,022
Final
Budget
$
632,160
213,925
50,170
27,063
Actual
$
632,160
217,210
50,379
25,225
Over
(Under)
Final Budget
$
3,285
209
(1,838)
Total elementary
931,816
923,318
924,974
1,656
Basic program - middle school
Salaries
Employee benefits
Purchased services
Supplies and materials
351,001
96,037
18,796
148,784
324,703
81,558
29,302
15,000
324,731
81,940
29,350
12,961
28
382
48
(2,039)
614,618
450,563
448,982
(1,581)
-
72,863
6,667
6,050
4,995
40,069
3,305
1,626
4,205
(32,794)
(3,362)
(4,424)
(790)
-
90,575
49,205
(41,370)
Total middle school
Basic program - summer school
Salaries
Employee benefits
Purchased services
Supplies and materials
Total summer school
6-3
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Expenditures Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
Added needs - special education
Salaries
Employee benefits
Purchased services
Supplies and materials
$
160,470
45,510
-
Final
Budget
$
148,662
32,625
6,111
4,509
Actual
$
149,222
31,605
5,772
2,478
Over
(Under)
Final Budget
$
560
(1,020)
(339)
(2,031)
205,980
191,907
189,077
(2,830)
Added needs - compensatory education
Salaries
Employee benefits
Purchased services
Supplies and materials
227,975
63,797
23,920
230,833
51,871
21,273
50,341
201,137
40,746
20,233
38,162
(29,696)
(11,125)
(1,040)
(12,179)
Total compensatory education
315,692
354,318
300,278
(54,040)
64,000
15,368
-
71,381
21,850
2,500
1,122
71,492
22,681
2,502
63
111
831
2
(1,059)
79,368
96,853
96,738
(115)
Total special education
Pupil - guidance services
Salaries
Employee benefits
Purchased services
Supplies and materials
Total guidance services
6-4
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Expenditures Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
Pupil - health services
Purchased services
Supplies and materials
$
20,000
-
Final
Budget
$
10,000
1,029
Actual
$
8,667
1,028
Over
(Under)
Final Budget
$
(1,333)
(1)
Total health services
20,000
11,029
9,695
(1,334)
Pupil - psychological services
Purchased services
10,000
10,000
9,579
(421)
Pupil - speech services
Purchased services
46,800
38,738
38,738
-
Pupil - social work services
Salaries
Employee benefits
Purchased services
35,853
5,694
-
35,854
5,054
1,255
40,866
5,436
1,318
5,012
382
63
41,547
42,163
47,620
5,457
84,319
15,017
7,894
10,589
14
52,403
3,688
43,692
3,008
50,787
2,765
33,103
2,994
(1,616)
(923)
107,230
66,694
100,252
33,558
Total social work services
Instructional staff - improvement of education
Salaries
Employee benefits
Purchased services
Supplies and materials
Total improvement of education
6-5
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Expenditures Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
Instructional staff - educational media services
Salaries
Employee benefits
Purchased services
Supplies and materials
$
Total educational media services
35,000
8,008
-
Final
Budget
$
29,304
4,402
1,087
99,020
Actual
$
26,364
4,150
984
99,017
Over
(Under)
Final Budget
$
(2,940)
(252)
(103)
(3)
43,008
133,813
130,515
(3,298)
-
7,949
13,496
7,949
12,167
(1,329)
-
21,445
20,116
(1,329)
-
35,757
8,401
1,193
2,471
33,568
7,234
1,174
2,286
(2,189)
(1,167)
(19)
(185)
-
47,822
44,262
(3,560)
7,400
9,000
8,305
(695)
Instructional staff - educational television
Instructional staff - technology assisted instruction
Purchased services
Supplies and materials
Total technology assisted instruction
Instructional staff - supervision and direction of instructional staff
Salaries
Employee benefits
Purchased services
Supplies and materials
Total supervision and direction of instructional staff
Instructional staff - academic student assessment
Purchased services
6-6
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Expenditures Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
General administration - board of education
Purchased services
Supplies and materials
Other
$
139,948
9,000
500
Final
Budget
$
121,418
7,600
-
Actual
$
123,440
7,553
-
Over
(Under)
Final Budget
$
2,022
(47)
-
149,448
129,018
130,993
1,975
95,000
8,015
208,574
1,000
95,000
13,129
130,749
-
94,126
12,557
124,531
-
(874)
(572)
(6,218)
-
312,589
238,878
231,214
(7,664)
General administration - grant writer/grant procurement
Purchased services
50,000
107,290
107,290
-
School administration - office of the principal
Salaries
Employee benefits
Purchased services
Supplies and materials
Other
99,668
34,479
23,000
25,500
2,000
136,278
59,104
27,695
25,226
2,086
136,277
59,619
28,357
24,690
2,085
(1)
515
662
(536)
(1)
184,647
250,389
251,028
639
Total board of education
General administration - executive administration
Salaries
Employee benefits
Purchased services
Other
Total executive administration
Total office of the principal
6-7
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Expenditures Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
School administration - other
Supplies and materials
$
Business - fiscal services
Salaries
Employee benefits
Purchased services
Supplies and materials
Other
Total fiscal services
Business - other
Other
Operations and maintenance - operating building services
Salaries
Employee benefits
Purchased services
Supplies and materials
Other
Total operating building services
6-8
35,000
Final
Budget
$
20,728
Actual
$
20,471
Over
(Under)
Final Budget
$
(257)
75,000
6,385
5,500
2,400
1,000
96,691
12,463
8,153
2,400
214
95,726
11,680
7,797
1,945
214
(965)
(783)
(356)
(455)
-
90,285
119,921
117,362
(2,559)
4,400
4,358
4,358
92,400
28,744
614,828
95,000
1,000
117,328
40,680
549,669
127,750
300
114,930
40,408
495,687
122,331
129
(2,398)
(272)
(53,982)
(5,419)
(171)
831,972
835,727
773,485
(62,242)
-
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Expenditures Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
Operations and maintenance - security services
Salaries
Employee benefits
Purchased services
Supplies and materials
$
29,936
11,577
1,700
-
Final
Budget
$
21,721
9,966
12,166
800
Actual
$
21,719
10,236
12,165
790
Over
(Under)
Final Budget
$
(2)
270
(1)
(10)
43,213
44,653
44,910
154,000
178,687
166,425
(12,262)
Central - communication services
Purchased services
15,000
12,000
9,340
(2,660)
Central - staff/personnel services
Purchased services
-
3,962
3,843
(119)
85,000
15,000
85,000
5,000
84,742
4,968
(258)
(32)
100,000
90,000
89,710
(290)
Total security services
Pupil transportation services
Purchased services
Central - support services technology
Purchased services
Supplies and materials
Total support services technology
6-9
257
Academy of Flint
Other Supplemental Information
General Fund
Schedule of Expenditures Compared to Budget
For the Year Ended June 30, 2011
Original
Budget
Community services - community activities
Salaries
Employee benefits
Purchased services
Supplies and materials
$
Total community activities
Capital outlay
Basic program - elementary
School administration - office of the principal
Operations and maintenance - operating building services
Operations and maintenance - security services
Building acquisition and construction services
Total capital outlay
Other financing uses
Transfers out
25,000
6,845
7,912
6 - 10
$
25,503
6,655
1,983
10,436
Actual
$
25,503
4,199
1,097
3,841
$
(2,456)
(886)
(6,595)
39,757
44,577
34,640
(9,937)
87,000
10,000
-
800
4,160
1,000
1,267
316,296
800
4,160
2,212
1,266
258,639
1,212
(1)
(57,657)
97,000
323,523
267,077
(56,446)
-
52,772
11,161
(41,611)
$ 4,944,721
$ 4,681,643
$ 4,530,770
Total expenditures and financing uses
Final
Budget
Over
(Under)
Final Budget
$
(263,078)
Academy of Flint
Other Supplemental Information
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2011
Special Revenue Fund
Food Service
Fund
Revenues
Local sources
State sources
Federal sources
$
3,440
8,200
282,325
293,965
Total revenues
Expenditures
Current
Education
Food services
305,126
(11,161)
Deficiency of revenues over expenditures
Other Financing Sources (Uses)
Transfers in
11,161
Net change in fund balance
-
Fund balance - beginning
$
Fund balance - ending
6 - 11
-

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