Academy Journal Volume 58 - Page 46

the academy journal and actual results. Depreciation of $4.8 mil- lion is included with operating expenses in our audited financials for fiscal 2017. rent year construction costs of the college dormitory. • Total Debt Service of $4.2 million was over budget by $114 thousand. Two components make up this result: Capital Items Details In summary, total income and other receipts are less than budget by $5.8 million and expen- ditures are less than budget by $5.0 million. The most significant factor contributing to both vari- ances was including the total construction costs and gift and pledge receipts for the new college dormitory in the budget when in fact a sizable por- tion of the construction occurred in the second half of fiscal 2016. The timing for the preparation of the capital budget assumed more costs would occur in fiscal 2017. The year-end results are a deficit of $2.96 mil- lion for the year. Since we covered the costs of each project with either a restricted gift, a grant or from operations, the deficit in the capital budget can be attributed exclusively to debt service offset by endowment payout of $1.16 million as well as gifts received for debt repayment or capital campaign pledge pay- ments of $42,000 less $24,000 in expenses related to miscellaneous projects. • Capital Campaign and Other Gifts (cash re- ceipts only) totaled $1.9 million and include gifts for the new college turf field ($1.4 mil- lion) and gifts to support college athletics ($269 thousand). In addition to $42,000 of new gifts, receipts from capital campaign pledges of $24,000 are to be applied to debt reduction. x x Interest and fees on our debt totaled $539,000 coming in at $89,000 over budget. Our debt has a variable interest rate and began the year at 1.05% but in- creased to 1.6125% by year end, account- ing for the negative variance. x x We made principal payments of $3.64 million exceeding the budget for fiscal 2017 by $25 thousand. We made two planned withdraws of $3.6 million from our endowment to pay down the debt. In addition, we were fortunate to receive gifts earmarked for debt reduction in the amount of $25,000. • Capital Expenditures exceeded budget by $5.2 million. As stated above, the deficit was primarily due to including the full cost of the new college dormitory in the current year’s budget when in fact only $3.6 million of the costs occurred in the current year. Examples of additional expenditures include: x x $1.34 million was spent on the new col- lege turf field. The cost of this project was fully covered by a very generous gift! x x $293,000 was spent on Glenn Hall re- pairs. x x Benade Hall floor renovations cost $96,000 and was funded from a grant. • Endowment Payout was $496,000 less than budget. The variance is primarily due to withdrawals for debt payments. x x Glencairn spent $192,000 on renovations to the terrace fountain. The bottom line for the Academy Operations and Capital Items Summaries is $5.5 million of expenditures in excess of receipts. This is an in- crease of $2.25 million from the $3.2 million ex- penditures in excess of receipts in fiscal 2016. We have been tracking the progress in reducing the combined deficit from fiscal 2011’s $17.4 million combined deficit and unfortunately the progress has been reduced to $11.9 million. It is still a sig- nificant improvement from fiscal 2011 but we must remember the combined deficits are funded by en- dowment withdrawals coming primarily from the endowments allocated to the schools and debt. We need to move back in the right direction. • Sale, Transfers & Other exceeded budget by $3.5 million: x x $4.0 million was transferred from the operating budgets of the college and the secondary schools, the Academy Quasi- Endowment Fund and various restricted funds to fund various projects. Gifts for capital projects that do not get used in the year received are moved to these restricted funds until the project is com- pleted at which time the funds are trans- ferred into the capital budget. • More specifically, a sizeable portion of the transfer was to fund the $3.6 million in cur- 46