Comprehensive Annual Financial Report-FY2007

7/30/2019 Comprehensive Annual Financial Report-FY2007

1/130

Navarro College DistrictCorsicana, Texas

Comprehensive Annual Financial Report

Years Ended August 31, 2007 and 2006

Prepared by:

Navarro College DistrictFinance Department


2/130


3/130


4/130


5/130


6/130


7/130


8/130


9/130

3200 West 7

thAvenue

Corsicana, Texas 75110

(903) 874-6501FAX: (903) 874-4636

www.navarrocollege.edu

December 6, 2007

To the Honorable Chairman, Board of Trustees, and President

Navarro College District

The following comprehensive annual financial report of Navarro College (the District) for fiscal

years ended August 31, 2007 is hereby submitted.

Management assumes full responsibility for the completeness and reliability of the information

contained in this report, based upon a comprehensive framework of internal control that has been

established for this purpose. Because the cost of internal control should not exceed anticipatedbenefits, the objective is to provide reasonable, rather than absolute, assurance that the financial

statements are free of any material misstatements.

Jaynes, Reitmeier, Boyd & Therrell, P.C., Certified Public Accountants, have issued an

unqualified (clean) opinion on Navarro College Districts financial statements for the years

ended August 31, 2007 and 2006. The independent auditors report is located at the front of the

financial section of this report.

Managements discussion and analysis (MD&A) immediately follows the independent auditors

report and provides a narrative introduction, overview and analysis of the basic financialstatements. MD&A complements this letter of transmittal and should be read in conjunction

with it.

PROFILE OF THE DISTRICT

Navarro College was established as a public community college in an election held in NavarroCounty, Texas on July 16, 1946. The District operates as a community college under the

Constitution of the State of Texas and the Texas Education Code. The District is governed by an

elected seven-member Board of Trustees (hereinafter call the Board). At each election (thesecond Saturday in May in odd numbered years) two Trustees are elected, one at large and one

vii


10/130


11/130


12/130


13/130


14/130


15/130


16/130


17/130


18/130

xvi

Net assets is divided into three sections: Invested in capital assets, net of debt; restricted netassets and unrestricted net assets. Total net assets increased from $29,197,044 at August 31,2006 to $29,638,252 at August 31, 2007.

Statement of Revenues, Expenses and Changes in Net Assets

The Statement of Revenues, Expenses and Changes in Net Assets is the activity that resulted inthe change in net assets reflected in the Statement of Net Assets. The Statement of Revenues,Expenses and Changes in Net Assets is divided into five sections: operating revenues;nonoperating revenues; operating expenses; nonoperating expenses; and other revenues,(expenses) and gains (losses). The Managements Discussion and Analysis provides detail onthe purpose of this statement as well as a condensed version of the statement.

Governmental Accounting Standards Board (GASB) Statement Nos. 34 and 35 require thattuition and fees and auxiliary enterprise charges be reported net of any allowances and discounts.The tuition and fees, net of allowances, are $6,881,618 representing a 25% increase over theprior year. Auxiliary enterprise charges, net of discounts, are $4,499,802 at August 31, 2007,which reflects a 10% increase from the prior year due to the increased number of studentsserved.

State allocations decreased to $13,776,780 due to the expiration of the special appropriation forthe Midlothian Campus.

Assets, Liabilities and Net Assets

at August 31, 2007

$19,905,419

$51,972,773

$10,529,235

$31,710,705

$29,638,252

Current Assets Noncurrent Assets Current Liabilities

Noncurrent Liabilities Net Assets


19/130


20/130


21/130


22/130


23/130


24/130


25/130

Navarro CollegeBoard of Trustees and President

Lloyd HuffmanVice-Chairman

Homer G. WassonChairman

Dr. James G. PriceSecretary-Treasurer

James E. BorkchumTrustee

Dr. Richard SanchezDistrict President

Navarro College

Liston HerodTrustee

Todd McGrawTrustee

Zane StitesTrustee

xxiii


26/130


27/130


28/130


29/130

JAYNES,REITMEIER,BOYD &THERRELL,P.C.

Certified Public Accountants

5400 Bosque Blvd., Suite 500, Waco, Texas 76710

P.O. Box 7616 Waco, Texas 76714-7616

Phone 254.776.4190 Fax 254.776.8489

Web www.jrbt.com

An Independent Member of the BDO Seidman Alliance

Independent Auditors' Report

The Board of Trustees

Navarro College District:

We have audited the accompanying financial statements of the business-type activities and the

discretely presented component unit of Navarro College District (the District) as of and for the

years ended August 31, 2007 and 2006, which collectively comprise the Districts basic

financial statements as listed in the table of contents. These financial statements are the

responsibility of the District's management. Our responsibility is to express opinions on these

financial statements based on our audits. We did not audit the financial statements of Navarro

College Foundation, Inc. (the Foundation), a discretely presented component unit of the

District. Those financial statements were audited by other auditors whose reports thereon have

been furnished to us, and our opinion on those financial statements, insofar as it relates to the

amounts included for the Foundation, was based on the reports of the other auditors. The

financial statements of the Foundation were not audited in accordance with GovernmentAuditing Standards.

We conducted our audits 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 audits 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 audits and the report of the other auditors provide a reasonable basis for our opinions.

In our opinion, based on our audits and the report of other auditors, the financial statements

referred to above present fairly, in all material respects, the respective financial position of the

business-type activities and the discretely presented component unit of Navarro College District

as of August 31, 2007 and 2006, and the respective changes in financial position and cash flows

for the years then ended in conformity with accounting principles generally accepted in the

United States of America.


30/130


31/130


32/130


33/130


34/130


35/130


36/130


37/130


38/130


39/130


40/130


41/130


42/130


43/130


44/130


45/130


46/130


47/130


48/130


49/130


50/130


51/130


52/130


53/130


54/130


55/130


56/130


57/130


58/130


59/130


60/130


61/130


62/130


63/130


64/130


65/130


66/130


67/130


68/130


69/130


70/130


71/130


72/130


73/130


74/130


75/130


76/130


77/130


78/130


79/130


80/130


81/130


82/130


83/130


84/130


85/130


86/130


87/130


88/130


89/130


90/130


91/130


92/130


93/130


94/130


95/130


96/130


97/130


98/130


99/130


100/130


101/130


102/130


103/130


104/130


105/130


106/130


107/130


108/130


109/130


110/130


111/130


112/130


113/130


114/130


115/130


116/130


117/130


118/130


119/130


120/130


121/130




P.O. Box 7616 Waco, Texas 76714-7616

Phone 254.776.4190 Fax 254.776.8489

Web www.jrbt.com


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



We have audited the financial statements of the business-type activities and the discretely

presented component unit of Navarro College District (the District) as of and for the year ended

August 31, 2007, which collectively comprise the Districts basic financial statements, and have

issued our report thereon dated December 6, 2007. 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. We did not audit the financial statements of Navarro

College Foundation, a discretely presented component unit. Those financial statements were

audited by other auditors whose report thereon has been furnished to us, and our opinion on

those financial statements, insofar as it relates to the amounts included for Navarro CollegeFoundation (the Foundation), was based solely on the report of the other auditors. The financial

statements of the Foundation were not audited in accordance with Government Auditing

Standards.

Internal Control Over Financial Reporting

In planning and performing our audit, we considered the District'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 the Districts internal control over financial reporting. Accordingly, we do not

express an opinion on the effectiveness of the Districts internal control over financial reporting.

Our consideration of internal control over financial reporting was for the limited purpose

described in the preceding paragraph and would not necessarily identify all deficiencies in

internal control over financial reporting that might be significant deficiencies or material

weaknesses. However, as discussed below, we identified a certain deficiency in internal control

over financial reporting that we consider to be significant deficiency.

95


122/130


123/130




P.O. Box 7616 Waco, Texas 76714-7616

Phone 254.776.4190 Fax 254.776.8489

Web www.jrbt.com


Report on Compliance with RequirementsApplicable to Each Major Federal and State Program and

Internal Control Over Compliance in Accordance with

OMB Circular A-133



Compliance

We have audited the compliance of Navarro College District (the District) with the types of

compliance requirements described in the U. S. Office of Management and Budget (OMB)Circular A-133 Compliance Supplementand the Uniform Grant Management Standards that

are applicable to each of its major federal and state programs for the year ended

August 31, 2007. The Districts major federal and state programs are identified in the

summary of auditors 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 and state programs is the responsibility of the Districts

management. Our responsibility is to express an opinion on the Districts 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 containedin Government Auditing Standards, issued by the Comptroller General of the United States; the

OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations; and

the Uniform Grant Management Standards. 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 or state program occurred. An audit includes

examining, on a test basis, evidence about the Districts 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 on the Districts compliance with those requirements.

In our opinion, the District complied, in all material respects, with the requirements referred to

above that are applicable to each of its major federal and state programs for the year ended

August 31, 2007. However, the results of our auditing procedures disclosed instances of

noncompliance with those requirements that are required to be reported in accordance with

OMB Circular A-133 and the Uniform Grant Management Standards, and which are described

in the accompanying schedule of findings and questioned costs as Finding 2007-2.

97


124/130


125/130


126/130


127/130


128/130


129/130


130/130

Documents

Comprehensive Annual Financial Report-FY2007