FMCC receives clean audit opinion

PHOTOGRAPHER:
The Fulton-Montgomery Community College Board of Trustees on Thursday reviewed and accepted results of the annual audit of the college’s financial statements for 2019 prepared by WEST & Company CPA’s PC. (The Leader-Herald/Ashley Onyon)

JOHNSTOWN — The Fulton-Montgomery Community College Board of Trustees on Thursday reviewed results of the annual audit of the college’s financial statements for 2019.

Amy Pedrick and Jill Thaisz of WEST & Company CPA’s PC presented an overview of the audit the firm conducted in October, saying the process went smoothly and FMCC’s financial statements present fairly.

“The audit went very well, the college staff is very well prepared for us and always very helpful for any of our questions,” said Thaisz. “In our opinion the financial statements present fairly, that is a clean audit opinion, officially known as an unmodified opinion. That is the highest that the college can receive.”

According to the audit, the college’s net position at the end of fiscal year 2019 totalled $13.49 million, with assets totalling $25.95 million, deferred outflows from pensions and other post employment benefits of $3.98 million, liabilities of $14.35 million and deferred inflows related to pensions and other post employment benefits totalling $2.08 million.

Thaisz noted that the largest share of the school’s liabilities come from other post employment benefits liabilities, or the estimate of what the college will have to pay to provide retiree health insurance benefits, estimated at $10.84 million based on actuarial calculations. Under state law FMCC is not allowed to fund any portion of that liability.

“Each year you budget for the amount you will pay in that year and you’re not allowed to set aside any additional funds for that future liability,” said Thaisz.

Similarly, state law prohibits the college from funding its portion of the state employee retirement system, yet auditors are required to include these items in their evaluations.

The annual audit showed a $232,480 decrease in net tuition and fees for 2019 to a total of $3.74 million, down from 2018’s $3.97 million due to declining enrollment.

Despite the decline in tuition and fees, the college experienced a dip in operating revenues of just $73,303 in 2019 to a total of $6.9 million from 2018’s $6.98 due in part to increases in grants and contract sfrom state and local sources and other operating revenues.

Revenues at FMCC totalled $24.37 million in 2019, down from $27.75 million in 2018. Operating expenses at FMCC totalled $23.63 million in 2019, down from $24.7 million in 2018. The difference in revenues and operating expenses was recorded as a net deficit of $231,967 for 2019. The college recorded a net profit of $2.86 million in 2018.

Additionally, a required governmental audit pertaining to FMCC’s financial reporting found no significant deficiencies or material weaknesses and was reported as an unmodified, clean opinion.

A compliance audit pertaining to the college’s grant awards triggered by FMCC’s receipt of over $750,000 in federal awards was also returned as a clean, unmodified opinion with no significant deficiencies or material weaknesses. FMCC expended $8.62 million in federal grant awards in 2019 out of which $7.51 million was assigned to student financial assistance.

WEST & Company returned only one recommendation in the school’s audit pertaining to the Gramm-Leach-Bliley Act that requires schools to complete risk assessments surrounding protections over student financial aid information and to adopt related policies. Pedrick noted that the college was in the midst of that process when the audit was conducted and auditors recommended that the college complete the required work before the end of the year.

“I’m sure at this point we’re pretty much close to that,” said Pedrick. “As Jill said, it was a very clean audit, it always is, the college does a great job giving us everything, books and records are in great shape, the controls are operating well.”

Following a brief executive session with the external auditors, the Board of Trustees approved a motion accepting the 2019 audit report.

Trustee James Landrio commended the efforts of college staff members and administrators in the finance department for another “job well done” leading into the audit and for maintaining the school’s financial position year round.

“You always make it a smooth process for us and we’re very appreciative of that,” agreed board Chair Ryan Weitz.

“A lot of people work hard throughout the year to make this happen, so thank you,” said Vice President of Administration and Finance Gregg Wilbur.

By Josh Bovee

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