Mohave community college ... financial report

              2010-2011 Comprehensive
Annual Financial Report
Mohave Community College
www.mohave.edu
[REPORT CONTENTS] Introductory Section
Mohave Community College 1 | P a g e Annual Report 2010-2011
Introductory
2 Message from the President
3 Transmittal Letter
8 Organizational Chart
9 Mission, Values, Goals and Vision
Financial
10 Report of Independent Auditors
12 Management Discussion and Analysis
22 Financial Statements
28 Notes to Financial Statements
Statistical
49 Financial Trends
60 Revenue Capacity
65 Debt Capacity
69 Demographic & Economic Information
74 Operating Information
This financial report was compiled by the Office
of the Controller.
Mohave Community College
1971 Jagerson Avenue
Kingman, AZ 86409
Board of Governors
Julie Bare - President (District 3)
Judy Selberg - Secretary (District 1)
Kathleen Hodel - Trustee (District 2)
Travis Lingenfelter - Trustee (District 4)
Vance Miller - Trustee (District 5)
College Administration
Michael J. Kearns
President
H. Lynn Cundiff
Vice President for Administration
Alan Klaas
Associate Vice President for Advancement
Janice Woods
Dean of Student Services
Dick MacDonald
Dean of Business Services
Michael Rourke
Dean of Instruction
Fred Gilbert
Dean of Kingman Campus
Nicholas Sanchez
Dean of Lake Havasu Campus
Shawn Bristle
Dean of Bullhead City Campus
Carolyn Hamblin
Dean of North Mohave Campus
Diana Stithem
Dean of Distance Education
Mohave Community College 2 | P a g e Annual Report 2010‐2011
November 15, 2011
To the Residents of Mohave County Community College District:
This Comprehensive Annual Financial Report has been created to provide a
complete financial picture of Mohave Community College District, in order
to offer transparent information to the public and other interested parties.
The district understands its role as a steward of taxpayer money. This report
is designed to show the ways in which the district has demonstrated its
stewardship by positioning Mohave County Community College District well
during these difficult economic times, and by focusing on its education
mission to assure students, and all citizens of Mohave County, the quality
education they deserve.
The financial operations of the District have been at the forefront of
discussion in recent years, as reduced state funding has become a reality.
The United States and the State of Arizona in particular, have been facing
truly difficult economic times over the last several years. Community
Colleges must educate more students than ever before with less financial
support from the state. The District, with the support and approval of its
governing board, made significant financial moves over the last year to
proactively place the college in a strong position. One such move was the
decision to pay off more than half of the existing long‐term debt, in an
effort to free the budget for forthcoming funding cuts.
The District has increased and improved financial reporting in every
available area and this Comprehensive Annual Financial Report reflects that
effort. The district will continue to carry out its mission in the most efficient
and effective way possible to help continue the goal of improving the lives
of Mohave County citizens through higher education.
Sincerely,
Michael J. Kearns
President
Mohave Community College 3 | P a g e Annual Report 2010‐2011
November 15, 2011
To the Residents of Mohave County Community College District:
Mohave County Community College District is pleased to present the
Comprehensive Annual Financial Report (CAFR) for the fiscal year ended
June 30, 2011. The District is responsible for the accuracy, completeness,
and fairness of the data presented in this report.
To the best of our knowledge, the following report is accurate in all material
respects. It has been prepared in accordance with Generally Accepted
Accounting Principles and all standards prescribed by the Governmental
Accounting Standards Board. We believe the report contains all disclosures
necessary for the reader to understand the District’s financial affairs.
District management is responsible for establishing and maintaining
adequate financial controls to ensure that assets are protect from loss, theft
or misuse, and to ensure accounting data is compiled to allow for the
preparation of financial statements in conformance with GASB and GAAP
requirements.
Arizona Revised Statutes requires community college districts to prepare an
annual budgeted expenditure limitation report and annual financial
statements. The Auditor General or a certified public accountant must audit
these documents on an annual basis. For the 2010‐11 year the statements
are audited by Moss Adams LLP. The auditors have provided the District
with an unqualified opinion meaning they believe the financial statements
to be fairly and appropriately presented.
Report Layout
This CAFR is presented in three sections:
 Introductory – Includes this transmittal letter, the District’s
organizational chart, a table of contents and a list of principal officers.
 Financial – Includes the Independent Auditor’s Report, Management
Discussion and Analysis (MD&A), and the basic financial statements.
 Statistical – Presents financial and demographic information for
historical perspective and trend analysis.
The Management Discussion and Analysis provides overview and analysis of
the financial statements. It should be read in conjunction with this
transmittal letter as well as the footnotes to the financial statements.
[TRANSMITTAL LETTER] Introductory Section
Mohave Community College 4 | P a g e Annual Report 2010-2011
Institutional Profile
Mohave County Community College was formally established in 1970 and now serves the entirety of
Mohave County through four separate physical campuses located in Kingman, Bullhead City, Lake
Havasu City, and Colorado City plus an extensive Distance Education campus.
Bullhead City is located along the Colorado River across
from Laughlin, Nev., the third largest gaming industry
destination in Nevada. Laughlin is the primary employer
for the residents of Bullhead City. The campus serves
students from the surrounding areas of Mohave Valley,
Fort Mohave, Needles, Calif., and Laughlin.
Kingman is the county seat and is located on Interstate 40.
Kingman’s initial economy was built on mining and
ranching; however, with the closure of the local mines,
light industry, tourism and service industries have begun to
drive the local economy.
Lake Havasu City is located on Lake Havasu, one of four
major lakes on the Colorado River. Lake Havasu City, home
of the London Bridge, is a modern, planned community; it
is also a well-known tourist destination. While its local
economy includes some light manufacturing, it is primarily
a tourism-based economy.
North Mohave County, which is separated from the rest of
the MCC campuses by the Grand Canyon, is served by a
campus in Colorado City. Colorado City shares a border
with Hildale, Utah and serves the residents of the
Paiute/Kaibab Indian Reservation. The campus also
attracts many students from Hurricane and St. George,
Utah.
In 1971, the first academic year, 27 courses were offered with 1,068 students attending (duplicated
headcount). The District now offers a wide variety of degrees and certifications for vocational and
university transfer purposes to more than 13,000 students.
[TRANSMITTAL LETTER] Introductory Section
Mohave Community College 5 | P a g e Annual Report 2010-2011
As a political subdivision of the State of Arizona, Mohave County Community College District is subject
to the oversight of the District’s Governing Board which is comprised of five elected members.
According to Arizona Revised Statutes the Governing Board is charged with managing the business and
education needs of the District while the administrative staff of the District remains responsible for the
operation and administration of all District activities. Although the District shares the same geographic
boundaries with Mohave County, financial accountability over all activities related to public community
college education in Mohave County is exercised solely by the District.
The District is accredited by the Higher Learning Commission and is seeking a renewed accreditation
during the 2012-13 academic year.
Performance and Planning
The District experienced another strong fiscal year as revenues reached budgeted levels while expenses
were closely controlled through process improvement and personnel cost savings realized through
attrition. Additionally, the District reduced the debt it owed and by year’s end had regenerated the
majority of money used for the debt payoff. More detailed information on these financial issues may be
found in the financial section of this report.
The District maintains a five year budget model based on projected revenues. However, because the
method for funding higher education across the nation is changing, the District has sought to create
more adaptable budget models and accounting tools which focus on the primary instructional mission of
the College. Management has developed financial ratios that relate to accreditation standards and also
serve as a metric for assessing major initiatives from an accounting and finance perspective.
Strategically budgeting expenses based on the operational areas of the District has enabled the District
to better distribute funding to the mission-sensitive areas of the College. Additionally, presenting major
financial decisions in a way that illustrates the effect on the entire balance sheet across several years
and not solely a given fiscal year budget in addition to connecting the data to established benchmarks
has enhanced the planning process for the District’s finances. The District’s method of ratio analysis for
financial scenarios was successfully presented at the 2011 Annual Higher Learning Commission
conference and will also be presented at the annual Association of Community College Trustees
meeting.
The District also maintains a five year Facilities Renovation Master Plan. The plan, further explained in
the MD&A, allows for the cyclical improvement of College facilities in line with budget considerations.
This plan, in addition to academic and enrollment specific plans, are all outlined and required by the
District’s Governing Board approved strategic plan. The plan represents collective decision making and
planning by administration, staff, students, and community members. It seeks to establish the school as
a learning-centered institution and provide resources, both human and financial, to this end. The
strategic plan emphasizes preparation for the upcoming accreditation visit by the Higher Learning
Commission in 2012 along with numerous academic access and success initiatives.
[TRANSMITTAL LETTER] Introductory Section
Mohave Community College 6 | P a g e Annual Report 2010-2011
Growth and Initiatives
The District continues to emphasize a number of successful initiatives with key highlights listed below:
 Dual enrollment partnerships with local high schools in each service area have grown
substantially and continue to grow as enrollment increases in this area.
 New program development, including a new Radiologic Technology and Health Information
Technology program, which will begin in fall of 2012, is being implemented to enhance
workforce development in Mohave County.
 The District is developing a strategic enrollment plan to improve existing enrollment services.
The plan will seek to strengthen the entire process from initial recruiting to graduation.
 Arizona State University plans to establish a campus in Lake Havasu City. The District is
committed to establishing a mutually beneficial partnership to ensure student success.
 The District will have a required accreditation visit from the Higher Learning Commission in
2012-13. Documentation and preparation have been ongoing for several years to assure
continued accreditation following the on-site visit.
Financial Reporting
The Comprehensive Annual Financial Report (CAFR) for the District was formulated with data from
several sources, including District financial records, Mohave County, and the US Census Bureau. The
District’s CAFR is distributed to the District Governing Board and administration, the State Legislature,
Federal and State agencies, financial institutions, and the citizens of Mohave County. Internal
management reports are customized and provided to aid in management decision making processes.
Independent Audit
The Office of the Auditor General for the State of Arizona contracted the services of Moss Adams, LLP to
perform audit services for Mohave Community College for the 2010-11 fiscal year. The Report of the
Independent Auditors is included in the financial section of this report. The District received an
unqualified opinion for fiscal year 2010-11.
GFOA Certificate of Achievement
2010-11 marks the first year the District has compiled a Comprehensive Annual Financial Report.
Government entities may submit their CAFR’s to the GFOA (Government Finance Officers Association) in
an effort to be awarded with a Certificate of Achievement for financial reporting. The report must be
easily readable and efficiently organized and must also be in compliance with generally accepted
accounting principles and applicable legal requirements. The District will submit this CAFR to the GFOA
to determine its eligibility for the achievement award.
[TRANSMITTAL LETTER] Introductory Section
Mohave Community College 7 | P a g e Annual Report 2010-2011
Acknowledgement
The District would like to extend genuine appreciation to the staff members in the Financial Services
Department as well as those throughout the District whose efforts helped compile this report. The
efforts of Administration and the Governing Board for their continuous efforts to improve Mohave
Community College through responsible financial planning are also appreciated. Also, many thanks are
extended to the professionals of Moss Adams for completing a timely and productive audit.
Respectfully,
H. Lynn Cundiff
Vice President for Administration
[ORGANIZATIONAL CHART] Introductory Section
Mohave Community College 8 | P a g e Annual Report 2010-2011
Taxpayers & Community
Governing Board
President
Associate VP of Vice President
College
Advancement
Chief Information
Officer
Dean of Student
Services
Campus Deans
Dean of Financial
Services
Director of
Institutional
Information
Dean of Instruction
Director of
Marketing & Public
Information
Bursar Office
Accounting
Services
Budgeting
Administrative
Support Services
Disability Services
Registrar
Financial Aid
Admissions &
Recruitment
Instructional Design
Program Director
Dean of
Distance Education
Dean of
Lake Havasu Campus
Dean of
Bullhead City Campus
Dean of
Neal Campus
Dean of
North Mohave Campus
Library Services
Director of Human
Director of Title III Resources Director SBDC
[MISSION, GOALS, VALUES & VISION] Introductory Section
Mohave Community College 9 | P a g e Annual Report 2010-2011
Mission - The mission of Mohave Community College is to be a learning-centered college, serving all
constituencies, inspiring excellence through innovative learning methodologies and empowering
students to succeed.
Goals - Mohave Community College strives to provide high quality, affordable and accessible higher
education to all who seek it.
 Educational: Mohave Community College supports an academic learning-centered community
through implementation of quality teaching initiatives, professional development, integration of
learning technology, development of partnerships, delivery of effective student support
services, and by providing accurate information and advising.
 Cultural: Become a conduit between businesses, organizations, foundations and the arts to
strengthen understanding of the world through education.
 Civic: Promote active citizenship within the college community
 Resources: Provide resources needed to achieve the mission and vision
Values Statement - These values govern our actions and our interactions with the members of our
communities. This statement represents what we value most about the service provided by MCC.
 Building a Better Tomorrow through Learning: Learning is the core of the Mohave Community
College mission. We acknowledge the importance of continuous learning to ensure the best
possible future for everyone.
 Accountability for the Future: The decisions made today affect individuals in the future. At
Mohave Community College, we accept responsibility for our actions and decisions. We hold
ourselves accountable to our students, our communities, and to the generations who come
after us. MCC decisions will be designed to fulfill our vision for the future, aiming to achieve
reliable, long-term improvements over short-term expediency.
 Integrity: We remain committed to our values. Our decisions are consistently and courageously
made in alignment with our convictions. We consciously foster an atmosphere of openness and
trust, making data-driven decisions that are balanced by a cultivated sense of compassion.
 Responsiveness: We take pride in flexibly responding to our changing environment, promptly
providing programs that are needed by our students and communities.
 Quality: We aim for excellence in all that we do while embracing the concept of efficiency.
 Providing a Supportive Environment: Mohave Community College is committed to student
success. We show respect to all and work to overcome barriers to honesty, trust and sincerity.
We take pride in providing friendly service to our students and communities.
 Having Fun: We embrace the concept of having fun and finding joy in our work and services.
Vision Statement - Mohave Community College is recognized as the center of educational, cultural
and civic activities by the communities it serves.
[REPORT OF THE INDEPENDENT AUDITORS] Financial Section
Mohave Community College 10 | P a g e Annual Report 2010-2011
Report of Independent Auditors
To the Governing Board of
Mohave County Community College District, Kingman, Arizona
and
The Auditor General of the State of Arizona
We have audited the accompanying financial statements of the business-type activities and
discretely presented component unit of Mohave County Community College District (the District),
as of and for the year ended June 30, 2011, which collectively comprise the District’s 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 an opinion on these financial statements
based on our audit. We did not audit the financial statements of the discretely presented
component unit. Those financial statements were audited by other auditors whose report thereon
has been furnished to us, and our opinion, insofar as it relates to the amounts included for the
discretely presented component unit, is based solely on the report of the other auditors.
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 other auditor’s report on the
audit of the discretely presented component unit was conducted in accordance with auditing
standards generally accepted in the United States of America. 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 consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the District’s internal control
over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial statements, 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 and the report of
other auditors provide a reasonable basis for our opinions.
In our opinion, based on our audit and the report of the other auditors, the financial statements
referred to above present fairly, in all material respects, the respective financial position of the
business-type activities and discretely presented component unit of the District as of June 30, 2011,
and the respective changes in financial position and, where applicable, cash flows thereof for the
year then ended in conformity with accounting principles generally accepted in the United States of
America.
[REPORT OF THE INDEPENDENT AUDITORS] Financial Section
Mohave Community College 11 | P a g e Annual Report 2010-2011
To the Governing Board of
Mohave County Community College District, Kingman, Arizona
and
The Auditor General of the State of Arizona
The accompanying Management’s Discussion and Analysis, as listed in the table of contents, 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 inquires of management regarding the methods of measurement and
presentation of the required supplementary information. However, we did not audit the
information and express no opinion on it.
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the Mohave County Community College District's basic financial statements.
The introductory and statistical sections listed in the table of contents are presented for purposes
of additional analysis and are not a required part of the basic financial statements. The introductory
and statistical sections have not been subjected to the auditing procedures applied in the audit of
the basic financial statements and, accordingly, we express no opinion on them.
In accordance with Government Auditing Standards, we will also issue our report on our
consideration of the District’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 at a future date. 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 internal control over financial reporting or 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.
Albuquerque, New Mexico
November 15, 2011
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 12 | P a g e Annual Report 2010-2011
The discussion and analysis below provide an
overview of the financial position and activities
of Mohave County Community College District
for the year ended June 30, 2011. This
discussion has been prepared by management
and should be read in conjunction with the
financial statements and accompanying notes,
which follow this section.
Financial Report
The College presents this Comprehensive
Annual Financial Report (CAFR) in accordance
with the pronouncements issued by the
Governmental Accounting Standards Board
(GASB). In addition to the basic financial
statements described below the CAFR presents
a statistical section following the required
footnotes.
The District’s basic financial statements consist
of the following:
 The Statement of Net Assets reflects the
District’s financial position at June 30,
2011. It shows the various current and
noncurrent assets owned or controlled
and related liabilities. Capital assets are
depreciated over their useful life with
annual depreciation being reported as a
current year expense.
 The Statement of Revenues, Expenses,
and Changes in Net Assets reflects the
results of operations and other changes
for the year ended June 30, 2011. It
shows the various revenues and
expenses, both operating and non-operating.
 The Statement of Cash Flows reflects
the inflows and outflows of cash and
cash equivalents for the year ended
June 30, 2011.
GASB Statement No. 39, Determining Whether
Certain Organizations Are Component Units,
requires reporting as a component unit those
organizations that raise and hold economic
resources for the direct benefit of the District.
Accordingly, the financial statements of the
Mohave Community College Foundation, Inc.
are discretely presented.
The following Management Discussion and
Analysis applies only to the College and does
not reflect financial information from the
component unit.
Although the primary focus of this document is
on the results of activity for fiscal year 2010-11,
comparative data is presented for the previous
fiscal year 2009-10. This Management’s
Discussion and Analysis (MD&A) uses the prior
fiscal year as a reference point in illustrating
issues and trends for determining whether the
institution’s financial health may have improved
or deteriorated.
Questions concerning any of the information
provided in the basic financial statements or
requests for additional financial information
should be addressed to the Financial Services
Department, Mohave Community College, 1971
Jagerson Ave., Kingman, AZ 86409-1238.
Financial Highlights and Analysis
The financial planning and economic outlook for
the College continues to be framed by the
economic conditions at the State level. The
District experienced a strong 2010-11 fiscal year
as revenue met full budget expectations and
expenses fell considerably below budget.
At the onset of State budget concerns in 2007-
2008, management began steering strategic
budgeting toward a “zero state aid
dependency” model. The progressive decrease
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 13 | P a g e Annual Report 2010-2011
in state funding relative to all College funding
sources has continued each year. Process
improvements and expense reductions have
taken place each year allowing the College to
position itself against possible cuts. For the
2010-11 year the College received $3,682,900 in
state aid, equal to the state aid distribution
from prior year 2009-10.
However, the College is expected to receive a
50% reduction in state aid appropriations for
the 2011-12 fiscal year with additional cuts
possible based on a deepening budget crisis.
Though the reduced appropriations negatively
affect the College’s total revenue the education
mission of the College has been strengthened
through strategic budgeting and resource
allocation focused on students.
In anticipation of the state aid reduction the
District Governing Board elected to pay off two
outstanding bond issues during the 2010-11
fiscal year. Unrestricted net assets were used to
pay off outstanding principal of $5,835,000. The
payoff represents $709,466 in interest savings
over five years in addition to the principal no
longer required for future budgets. This move
reflects the ongoing effort to reduce costs
through attrition, process examination, and
financial planning.
Key financial highlights for the District include:
 Total expenses increased just .1% over
prior fiscal year
 Instructional expenses increased 13.1%
 Institutional expenses decreased 19.3%
 Total operating revenue increased 6.8%
 Gross tuition and fees climbed 9.6%
 Total long-term debt decreased
$4,790,487
 Unrestricted net assets fell just
$683,470 or 6.2% following the elective
payoff of two bond issues
These highlights are not inclusive of all major
financial changes. The graphs and information
on the following pages provide further detail on
the 2010-11 fiscal year.
Economic Outlook
Mohave County has faced increased
unemployment as the real estate and
construction industries continue to remain
weak; an issue affecting the State at large.
Unemployment in the County increased from
4.6% in 2007 to 11.2% in 2010. The College has
seen enrollment increases during the recession
as many unemployed workers have returned to
further their education or learn new skills; and
this trend has continued through the 2010-11
year.
The District has responded to the communities’
employment needs by preparing to offer new
Radiologic Technology and Health Information
Technology programs in the 2012-13 academic
year. The District is also monitoring continued
development of numerous renewable energy
projects through the region. Several major
industrial developments, which will result in
jobs for the area, have been approved.
The District continues to see itself as a primary
driver of economic improvement in the county
and as a resource for an underemployed
workforce to return to work at a greater
earning capacity.
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 14 | P a g e Annual Report 2010-2011
Condensed Statement of Net Assets
As of
June 30, 2011
As of
June 30, 2010
Increase / (Decrease)
Amount % Change
Current assets $ 11,863,791 $ 13,035,973 $ (1,172,182) -9.0%
Noncurrent assets, other than capital assets 106,540 106,166 374 0.4%
Capital assets, net 17,761,519 16,535,736 1,225,783 7.4%
Total assets $ 29,731,850 $ 29,677,875 $ 53,975 0.2%
Long-term liabilities $ 6,034,369 $ 11,225,415 $ (5,191,046) -46.2%
Other liabilities 910,373 1,061,118 (150,745) -14.2%
Total liabilities $ 6,944,742 $ 12,286,533 $ (5,341,791) -43.5%
Net assets:
Invested in capital assets, net of related debt $ 12,155,904 $ 6,139,634 $ 6,016,270 98.0%
Restricted net assets 257,541 194,575 62,965 32.4%
Unrestricted net assets 10,373,663 11,057,133 (683,470) -6.2%
Total net assets $ 22,787,108 $ 17,391,342 $ 5,395,766 31.0%
The Statement of Net Assets for 2010-11 shows
an increase in the District’s net assets of
$5,395,766 representing a substantial increase
of 31% over prior year.
Current assets are considered those resources
that are available to meet the operating needs
of the District and are convertible to cash within
one year. Current assets for the District
decreased 9% as the District used unrestricted
cash reserves to pay off two outstanding bond
issues.
Noncurrent assets remained flat and capital
assets, net of accumulated depreciation,
increased 7.4% primarily due to the addition of
a new learning center leased from the
Foundation.
Long-term liabilities decreased 46.2% following
the payoff of two bond issues during the fiscal
year. Additionally, the liability for compensated
absences was reduced substantially following
the adoption of a new leave plan for eligible
District employees. Further information on
these liabilities can be found in the Notes to the
Financial Statements.
Other Liabilities were reduced by 14.2% due to
a large decrease in the current portion of long-term
debt. This figure represents the debt
payments due in the coming fiscal year. Other
liabilities remained otherwise flat versus prior
fiscal year.
Net assets invested in capital, net of related
debt nearly doubled reflecting the large
reduction in long-term debt and the overall
increase to capital assets. Unrestricted net
assets dropped by 6.2% following the debt
payoff but were largely recouped following a
year of strong revenue and reduced expense.
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 15 | P a g e Annual Report 2010-2011
Condensed Statement of Revenues, Expenses
and Changes in Net Assets
For the Year
Ended
June 30, 2011
For the Year
Ended
June 30, 2010
Increase / (Decrease)
Amount % Change
Operating revenues $ 5,542,944 $ 5,189,305 $ 353,639 6.8%
Operating expenses
Educational and general $ 34,745,129 $ 34,571,783 $ 173,346 0.5%
Auxiliary enterprises $ 273,818 $ 280,419 $ (6,601) -2.4%
Depreciation $ 1,468,082 $ 1,479,676 $ (11,594) -0.8%
Total operating expenses $ 36,487,029 $ 36,331,878 $ 155,151 0.4%
Operating loss $ (30,944,085) $ (31,142,573) $ 198,488 -0.6%
Non-operating revenues $ 36,758,190 $ 35,219,448 $ 1,538,742 4.4%
Non-operating expenses $ 418,339 $ 543,786 $ (125,447) -23.1%
Income before other revenues, $ 5,395,766 $ 3,533,089 $ 1,862,677 52.7%
expenses, gains or losses
Increase in net assets $ 5,395,766 $ 3,533,089 $ 1,862,677 52.7%
Net assets, Beginning of year $ 17,391,342 $ 13,858,253 $ 3,533,089 25.5%
Net assets, End of year $ 22,787,108 $ 17,391,342 $ 5,395,766 31.0%
The condensed financial information above
highlights the main categories of the Statement
of Revenues, Expenses, and Changes in Net
Assets. Tuition and fees minus scholarship
allowances are included in operating revenue.
The construction and acquisition of capital
assets, although budgeted and recorded as an
expense in the accounting system, is not
reported as an expense in these statements.
Such transactions are instead capitalized and
reported as assets – with the systematic
allocation of such costs (depreciation) expensed
over the useful lives of the assets constructed
or acquired. The District shows an increase in
net assets attributable to improved revenue in
line with budgeted expectations along with
reductions in expenses through process
improvement and savings through attrition. The
graph to the right illustrates the final
composition of net assets at June 30 for the last
two fiscal years.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010-11 2009-10
Net Asset Composition
Invested in capital assets, net of related debt
Restricted net assets
Unrestricted net assets
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 16 | P a g e Annual Report 2010-2011
Revenues by Source
For the Year
Ended
June 30, 2011
For the Year
Ended
June 30, 2010
Increase / (Decrease)
Amount % Change
Operating revenues
Tuition and fees (net of allowances) $ 4,526,951 $ 4,168,056 $ 358,895 8.6%
Private grants and contracts 726,101 592,730 133,371 22.5%
Bookstore income 134,039 222,701 (88,662) -39.8%
Other operating revenues 155,853 205,818 (49,965) -24.3%
Total operating revenues $ 5,542,944 $ 5,189,305 $ 353,639 6.8%
Non-operating revenues
Government grants and contracts $ 14,468,876 $ 13,939,348 $ 529,528 3.8%
Property taxes 18,085,425 17,048,446 1,036,979 6.1%
State appropriations 3,682,900 3,682,901 (1) 0.0%
Other 520,989 548,753 (27,764) -5.1%
Total non-operating revenues $ 36,758,190 $ 35,219,448 $ 1,538,742 4.4%
Total revenues $ 42,301,134 $ 40,408,753 $ 1,892,381 4.7%
Tuition and
fees
10.7%
Private grants and
contracts
1.7%
Bookstore
0.3%
Other
operating
0.4%
Government grants
and contracts
34.2%
Property taxes
42.8%
State aid
8.7%
Other
nonoperating
1.2%
Other
3.6%
Revenue Sources
(For year ended June 30, 2011)
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 17 | P a g e Annual Report 2010-2011
Revenues
Revenues for the District were strong for the
2010-11 year. Despite deep budget concerns at
the state level the District received the same
state appropriations as the prior fiscal year.
Property taxes increased 6.1% as new
construction in the County increased revenues
beyond the 2% increase in the levy approved by
the Governing Board. Tuition and fees increased
8.6% when reported net of allowances and 9.6%
when reported at gross. The increase in tuition
and fees is in line with the tuition increase
approved for the 2010-11 year for all in-state
and out-of-state students. In addition to the
tuition increase the District realized a small
increase of .6% in FTSE (full-time student
equivalent) enrollment. FTSE levels for 2010-11
and the previous five years are also shown
below.
In addition to the three primary revenue
sources mentioned above the District also
noted a 22.5% increase in Private Contracts
however bookstore income decreased by 39.8%
as the District cut back operations at the North
Mohave campus. Bookstores at the remaining
campuses are operated by Barnes & Noble with
the District receiving commission checks based
on strength of sales. Other non-operating
revenue decreased 5.1% as investment income
continued to decline. This is due to lower cash
holdings following the payoff of outstanding
debt along with the emphasis on investment
safety above return. In summary, the District
realized budgeted targets for revenue in all
major areas with state appropriations
continuing to comprise a smaller percentage of
total income.
2,815 2,866
3,143
3,518
3,953 3975
-1.10%
1.80%
9.70%
11.90%
12.40%
0.60%
-2.00%
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
1,500
2,000
2,500
3,000
3,500
4,000
4,500
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11
FTSE GROWTH
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 18 | P a g e Annual Report 2010-2011
Expenses
Total expenses for the 2010-11 year increased
just .1% as compared to a total revenue
increase of 4.7%. In consideration of the real
possibility of severe reductions in state aid
management has continued to reduce expenses
through attrition and conservative spending
and budgeting. No salary increases were
provided for the 2010-11 year though the
District did cover mandatory increases in
employer paid health insurance premiums and
Arizona State Retirement System contributions.
Management has made extended efforts to
streamline processes to enhance savings and
has, wherever possible, made efforts to move
necessary costs to the functional areas more in
line with the District’s strategic plan.
Instructional expenses increased 13.1% as new
faculty and other instructional positions were
added. Academic Support decreased 7.5% as
many positions remained unfilled and several
tech support and distance education functions
were realigned to instruction and student
services. Student Services increased 10% due to
new positions in financial aid and the addition
of a veteran’s services function. Institutional
expense decreased 19.3% as numerous
positions went unfilled after going vacant
including the role of Vice President for Student
Services and Instruction. Interest expense
decreased 23.6% as two of the District’s four
major debt issuances were paid in full in
December. Depreciation expense decreased
slightly despite an increase in overall capital
fixed assets as several major capital items
became fully depreciated. Depreciation is
expected to increase going forward along with
continued investment in capital assets.
Descriptions of the expenses included in the
functional areas of the District are below.
Functional Classification Description of Included Expenses
Instruction Includes all faculty costs and expenses for resources used
directly for instruction in the classroom.
Public Service Includes expenses for SBDC (Small Business Development
Center)
Academic Support Costs directly supporting the instructional mission. Includes
library services and program directors
Student Services Includes costs for Registrar, Financial Aid, Enrollment
Services and other expenses
Institutional Support Includes Administration, financial operations, human
resources, computing support and other expenses
Operation & Maintenance of Plant Costs relating to the upkeep and operation of physical plant
including grounds and repair
Scholarships Expenses for the awarding of scholarships and grants from
Institutional, Federal, or State funds
Auxiliary Enterprises District operated bookstore costs and public relations
expenses are included
Depreciation Capital assets are expensed over the course of their
estimated useful lives
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 19 | P a g e Annual Report 2010-2011
Expenses by Function
For the Year
Ended
June 30, 2011
For the Year
Ended
June 30, 2010
Increase / (Decrease)
Operating expenses Amount % Change
Education and general:
Instruction $ 10,743,772 $ 9,502,581 $ 1,241,191 13.1%
Public Service 134,167 144,167 (10,000) -6.9%
Academic Support 3,798,199 4,106,925 (308,726) -7.5%
Student Services 3,310,869 3,009,029 301,840 10.0%
Institutional support 6,118,714 7,578,624 (1,459,910) -19.3%
Operation and maintenance of plant 2,757,453 2,871,130 (113,677) -4.0%
Scholarships 7,881,955 7,359,327 522,628 7.1%
Auxiliary enterprises 273,818 280,419 (6,601) -2.4%
Depreciation 1,468,082 1,479,676 (11,594) -0.8%
Total operating expenses $ 36,487,029 $ 36,331,878 $ 155,151 0.4%
Non-operating expenses
Interest expense on debt $ 415,474 $ 543,786 $ (128,312) -23.6%
Loss on disposal of capital assets 2,865 0 2,865 100.0%
Total non-operating expenses $ 418,339 $ 543,786 $ (125,447) -23.1%
Total expenses $ 36,905,368 $ 36,875,664 $ 29,704 0.1%
Instruction
29%
Public Service
<1%
Academic Support
10%
Student Services
9%
Institutional
support
17%
Operation and
maintenance of plant
8%
Scholarships
22%
Auxiliary enterprises
1%
Depreciation
4%
Operating Expenses by Functional Classification
(For year ended June 30, 2011)
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 20 | P a g e Annual Report 2010-2011
Personnel Services
55%
Contract Services
8%
Supplies & Other
Services
6%
Communications &
Utilities
3%
Scholarships
22%
Depreciation
4%
Other
2%
Operating Expenses by Natural Classification
(For year ended June 30, 2011)
Expenses by Natural Classification
For the Year
Ended
June 30, 2011
For the Year
Ended
June 30, 2010
Increase / (Decrease)
Amount % Change
Personnel Services $20,180,416 $20,130,234 $ 50,182 0.2%
Contract Services 2,765,608 3,439,247 (673,639) -19.6%
Supplies & Other Services 2,380,083 2,313,898 66,185 2.9%
Communications & Utilities 1,119,185 1,024,747 94,438 9.2%
Scholarships 7,881,955 7,359,327 522,628 7.1%
Depreciation 1,468,082 1,479,676 (11,594) -0.8%
Other 691,700 584,749 106,951 18.3%
Total $36,487,029 $36,331,878 $ 155,151 0.4%
[MANAGEMENT DISCUSSION AND ANALYSIS] Financial Section
Mohave Community College 21 | P a g e Annual Report 2010-2011
Capital and Debt Management
Capital assets increased by $2,456,459 gross
and $1,225,783 net of accumulated
depreciation. The primary addition was the
acquisition of a new nursing instruction building
through a long-term lease with the Foundation.
The District directly purchased $1,381,410
worth of capital assets during the fiscal year as
well. The District is seeking to budget capital
expenditures at least at the level of expected
depreciation in order for facilities to stay
current and not fall into extended states of
disrepair requiring more advanced and
expensive remodels and upgrades. The below
graph illustrates the amount used for the
purchase of capital assets versus depreciation
expense for the last five fiscal years.
The District has developed a five year facilities
update plan. The plan calls for 20% of the
existing buildings and classroom space to be
renovated or updated each year. After the five
year cycle is completed each campus will have
received a renovation of all facilities. The
District is seeking to budget capital
expenditures at least at the level of expected
depreciation in order for facilities to stay
current and not fall into extended states of
disrepair requiring more advanced and
expensive remodels and upgrades. Wherever
possible the District is seeking to obtain new
facilities through outside donor funding as state
aid cuts and economic conditions have forced
resources away from major capital
improvement projects.
Also in anticipation of state funding decreases
the District elected to pay off two outstanding
bond issues in order to free future year budgets
of principal and interest payments. Further
information on the District’s debt structure is
available in Note 5 of the financial statements.
The table below shows the payments schedule
for the two bond issues prior to the payoff.
Interest Principal Total
2011-12 $263,558 $1,100,000 $1,363,558
2012-13 $202,058 $1,160,000 $1,362,058
2013-14 $137,205 $1,240,000 $1,377,205
2014-15 $67,895 $1,290,000 $1,357,895
0
0.2
0.4
0.6
0.8
1
1.2
2010-11 2009-10 2008-09 2007-08 2006-07
Physical Asset Reinvestment Ratio
Capital Assets Purchases divided by Depreciation Expense
[FINANCIAL STATEMENTS] Financial Section
Mohave Community College 22 | P a g e Annual Report 2010-2011
See Notes to Financial Statements
Primary Government Statement of Net Assets
(June 30, 2011)
Business-Type
Activities
Assets
Current assets:
Cash and cash equivalents
$ 5,571,073
Short-term investments
3,002,544
Receivables (net of allowances)
3,071,961
Inventories
2,273
Prepaid items
215,940
Total current assets
11,863,791
Noncurrent assets:
Restricted assets:
Cash and cash equivalents
106,540
Capital assets, net
17,761,519
Total noncurrent assets
17,868,059
Total assets
29,731,850
Liabilities
Current liabilities:
Accounts payable
425,428
Accrued payroll and employee benefits
319,121
Interest payable
59,284
Deposits held in custody for others
106,540
Current portion of compensated absences payable
2,521
Current portion of long-term debt
172,090
Total current liabilities
1,084,984
Noncurrent liabilities:
Compensated absences payable
426,233
Long-term debt
5,433,525
Total noncurrent liabilities
5,859,758
Total liabilities
6,944,742
Net Assets
Invested in capital assets, net of related debt
12,155,904
Restricted:
Expendable:
Grants and contracts
171,071
Capital projects
86,470
Unrestricted
10,373,663
Total net assets
$ 22,787,108
[FINANCIAL STATEMENTS] Financial Section
Mohave Community College 23 | P a g e Annual Report 2010-2011
Component Unit Statement of Financial Position
(June 30, 2011)
Assets
Cash and cash equivalents $ 217,331
Investments 2,527,417
Unconditional promises to give 85,732
Unimproved land held for investment 334,986
Capital lease receivable 1,260,123
Property and equipment 800,931
5,226,520
Liabilities and Net Assets
Liabilities:
Accounts payable 15,893
Custodial liabilities 61,864
Note payable 1,230,123
1,307,880
Net assets:
Unrestricted:
Expended for property and equipment 830,931
Board designated 1,216,981
Available for operations 424,825
2,472,737
Temporarily restricted 504,171
Permanently restricted 941,732
3,918,640
$ 5,226,520
See Notes to Financial Statements
[FINANCIAL STATEMENTS] Financial Section
Mohave Community College 24 | P a g e Annual Report 2010-2011
Primary Government Statement of Revenues, Expenses, and Changes
in Net Assets (For year ended June 30, 2011)
Business-Type
Activities
Operating revenues:
Tuition and fees (net of scholarship allowances of $7,067,489)
$ 4,526,951
Private contracts
726,101
Bookstore income
134,039
Food service income
26,540
Other sales and services
113,113
Other
16,200
Total operating revenues
5,542,944
Operating expenses:
Educational and general:
Instruction
10,743,772
Public service
134,167
Academic support
3,798,199
Student services
3,310,869
Institutional support
6,118,714
Operation and maintenance of plant
2,757,453
Scholarships
7,881,955
Auxiliary enterprises
273,818
Depreciation
1,468,082
Total operating expenses
36,487,029
Operating loss
(30,944,085)
Non-operating revenues (expenses):
Government grants
14,468,876
Property taxes
18,085,425
State appropriations
3,682,900
Share of state sales taxes
506,197
Investment income, net of investment expense
14,792
Interest expense on debt
(415,474)
Loss on disposal of capital assets
(2,865)
Total non-operating revenues (expenses)
36,339,851
Increase in net assets
5,395,766
Total net assets, July 1, 2010
17,391,342
Total net assets, June 30, 2011
$ 22,787,108
See Notes to Financial Statements
[FINANCIAL STATEMENTS] Financial Section
Mohave Community College 25 | P a g e Annual Report 2010-2011
Component Unit Statement of Activities
(For Year Ended June 30, 2011)
Unrestricted
net assets
Temporarily
restricted net
assets
Permanently
restricted net
assets Totals
Public support and revenues:
Contributions $ 2,296 122,844 $ 14,812 $ 139,952
Member dues contributions 33,178 33,178
In-kind contributions 88,745 88,745
Special event income, net of $36,057 direct donor benefit 29,506 29,506
Investment income 161,306 203,232 1,248 365,786
Interest income 67,053 67,053
Other 959 959
383,043 326,076 16,060 725,179
Releases from restrictions 246,055 (246,055)
Total public support and revenues 629,098 80,021 16,060 725,179
Expenses and gains:
Advertising 10,417 10,417
Alumni projects 14,170 14,170
Amortization 6,995 6,995
Annuity payments 9,368 9,368
Depreciation 5,760 5,760
Donor/recipient events 48,689 48,689
In-kind expense 8,042 8,042
Interest 55,673 55,673
Management fees paid to MCC 63,295 63,295
Meetings 1,866 1,866
Miscellaneous 5,463 5,463
Office expense 1,425 1,425
MCC operations 266,150 266,150
Printing 4,896 4,896
Professional fees 36,245 36,245
Supplies 14,577 14,577
Training 7,184 7,184
Travel 3,868 3,868
564,083 564,083
Change in fair market value of land held for investment 8,357 8,357
Total expenses and gains 572,440
-
-
572,440
Change in net assets before reclassification 56,658 80,021 16,060 152,739
Reclassification of funds with deficiencies 3,643 (3,643)
-
Change in net assets 60,301 76,378 16,060 152,739
Net assets, beginning of year, as restated 2,412,436 427,793 925,672 3,765,901
Net assets, end of year $ 2,472,737 $ 504,171 $ 941,732 $ 3,918,640
See Notes to Financial Statements
[FINANCIAL STATEMENTS] Financial Section
Mohave Community College 26 | P a g e Annual Report 2010-2011
Primary Government Statement of Cash Flows
(For Year Ended June 30, 2011)
Business-Type
Activities
Cash flows from operating activities:
Tuition and fees 4,195,487
Contracts 726,101
Bookstore receipts 134,039
Food service receipts 26,540
Sales and services 113,113
Other payments (18,857)
Payments to suppliers and providers of goods and services (8,969,963)
Payments to employees (18,426,536)
Payments for scholarships (7,881,953)
Net cash used for operating activities (30,102,030)
Cash flows from noncapital financing activities:
Grants 14,415,793
Property taxes 17,998,821
State appropriations 3,682,900
Share of state sales taxes 506,197
Deposits held in custody for others disbursed (56,898)
Deposits held in custody for others received 57,272
Net cash provided by noncapital financing activities 36,604,085
Cash flows from capital and related financing activities:
Proceeds from sale of capital assets 3,459
Principal paid on capital debt (6,109,267)
Interest paid on capital debt (522,156)
Purchases of capital assets (1,381,410)
Net cash used for capital and related financing activities (8,009,374)
Cash flows from investing activities:
Interest received on investments, net 16,045
Purchase of short-term investments (2,002,544)
Net cash used for investing activities (1,986,499)
Net decrease in cash and cash equivalents (3,493,818)
Cash and cash equivalents, July 1, 2010 9,171,431
Cash and cash equivalents, June 30, 2011 $ 5,677,613
See Notes to Financial Statements
[FINANCIAL STATEMENTS] Financial Section
Mohave Community College 27 | P a g e Annual Report 2010-2011
Primary Government Statement of Cash Flows (continued)
(For Year Ended June 30, 2011)
Business-Type
Activities
Reconciliation of operating loss to net cash
used for operating activities:
Operating loss
(30,944,085)
Adjustments to reconcile operating loss to net cash
used for operating activities:
Depreciation
1,468,082
Changes in assets and liabilities:
Increase in:
Accounts receivable
(35,057)
Student receivables
(331,464)
Accounts payable
29,071
Decrease in:
Prepaid items
183,791
Inventories
1,699
Accrued payroll and employee benefits
(73,509)
Compensated absences payable
(400,559)
Net cash used for operating activities
$ (30,102,030)
Reconciliation of cash and cash equivalents,
as presented on the Statement of Net Assets:
Cash and cash equivalents
$ 5,571,073
Restricted assets:
Cash and cash equivalents
106,540
Total cash and cash equivalents, June 30, 2011 $ 5,677,613
Non-cash investing, capital and noncapital financing activities:
During the year the District increased capital assets through a capital lease in
the amount of $1,309,626.
See Notes to Financial Statements
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 28 | P a g e Annual Report 2010-2011
Note 1 – Summary of Significant Accounting
Policies
The accounting policies of the Mohave County
Community College District conform to
generally accepted accounting principles
applicable to public institutions engaged only in
business-type activities adopted by the
Governmental Accounting Standards Board
(GASB).
Reporting Entity
The Mohave County Community College District
is a special-purpose government that is
governed by a separately elected governing
body (the Board). It is legally separate and
fiscally independent of other state and local
governments. The accompanying financial
statements present the activities of the District
(the primary government) and its component
unit, the Mohave Community College
Foundation, Inc. (MCCF, Foundation).
The Foundation is a legally separate, tax-exempt
organization. It acts primarily as a fund-raising
organization that receives gifts and
bequests, administers those resources, and
disburses payments to or on behalf of the
District for scholarships and programs.
Although the District does not control the
timing or amount of receipts from the
Foundation, the Foundation’s restricted
resources can only be used by, or for the
benefit of, the District or its constituents.
Consequently, the Foundation is considered a
component unit of the District and its financial
statements are presented in this report.
For financial reporting purposes, the
Foundation follows the Financial Accounting
Standards Board (FASB) statements for not-for-profit
organizations. As such, certain revenue
recognition criteria and presentation features
are different from GASB revenue recognition
criteria and presentation features. No
modifications have been made to the
Foundation’s financial information included in
the District’s financial report. Accordingly,
those financial statements have been reported
on separate pages following the respective
counterpart financial statements of the District.
For financial reporting purposes, only the
Foundation’s statements of financial position
and activities are included in the District’s
financial statements as required by generally
accepted accounting principles for public
colleges and universities. The Foundation has a
June 30 year-end.
During the year ended June 30, 2011, the
Foundation distributed $329,445 to the District
for both restricted and unrestricted purposes.
Complete financial statements for the
Foundation are included herein.
Basis of Accounting
The financial statements include a statement of
net assets; a statement of revenues, expenses,
and changes in net assets; and a statement of
cash flows.
The statement of net assets provides
information about the assets, liabilities, and net
assets of the District at the end of the year.
Assets and liabilities are classified as either
current or noncurrent. Net assets are classified
according to external donor restrictions or
availability of assets to satisfy District
obligations. The “Invested in Capital Assets Net
of Related Debt” category represents the value
of capital assets, minus accumulated
depreciation, less any outstanding debt
incurred to acquire or construct the assets. The
“Expendable Restricted Net Assets” category
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 29 | P a g e Annual Report 2010-2011
represents grants, contracts, gifts, and other
resources that have been externally restricted
for specific purposes. The “Unrestricted Net
Assets” category includes all other net assets,
including those that have been designated by
management to be used for other than general
operating purposes.
The statement of revenues, expenses, and
changes in net assets provides information
about the District’s financial activities during
the year. Revenues and expenses are classified
as either operating or non-operating, and all
changes in net assets are reported, including
capital contributions and additions to
endowments. Operating revenues and expenses
generally result from exchange transactions.
Accordingly, revenues such as tuition,
bookstore, and food service charges are
considered to be operating revenues. Other
revenues, such as property taxes, state
appropriations, and government grants, are not
generated from exchange transactions and are
considered to be non-operating revenues.
Operating expenses include the cost of sales
and services, administrative expenses, and
depreciation on capital assets. Other expenses,
such as interest expense on debt, are
considered to be non-operating expenses.
The statement of cash flows provides
information about the District’s sources and
uses of cash and cash equivalents during the
year. Increases and decreases in cash and cash
equivalents are classified as operating, non-capital
financing, capital financing, or investing.
The financial statements are presented using
the economic resources measurement focus
and the accrual basis of accounting. Revenues
are recorded when earned and expenses are
recorded at the time liabilities are incurred,
regardless of when the related cash flows take
place. Property taxes are recognized in the year
for which they are levied. State appropriations
are recognized as revenue in the year in which
the appropriation is first made available for use.
Grants and donations are recognized as
revenue as soon as all eligibility requirements
imposed by the provider have been met. It is
the District’s policy to first apply restricted
resources when an expense is incurred for
purposes for which both restricted and
unrestricted net assets are available.
The effect of internal activity has been
eliminated from the financial statements.
The District follows FASB Statements and
Interpretations issued on or before
November 30, 1989, Accounting Principles
Board Opinions; and Accounting Research
Bulletins, unless those pronouncements conflict
with GASB pronouncements. The District has
chosen the option not to follow FASB
Statements and Interpretations issued after
November 30, 1989.
Cash and Investments
The District’s cash and cash equivalents are
considered to be cash on hand, demand
deposits, certificates of deposit with three
months or less until maturity, cash and
investments held by the County Treasurer, and
highly liquid investments. Investments are
stated at fair value.
Inventories
Inventory is stated at cost using the weighted-average
method.
Capital Assets
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 30 | P a g e Annual Report 2010-2011
Capital assets are reported at actual cost.
Donated assets are reported at estimated fair
value at the time received.
All assets are depreciated using the straight-line
method. Capitalization thresholds (the dollar
values above which asset acquisitions are added
to the capital asset accounts) and estimated
useful lives of assets are show below.
Asset Category Threshold Method Useful Life
Land $1 N/A N/A
Buildings and improvements $5,000 Straight-line 20 – 40 years
Improvements other than buildings $5,000 Straight-line 15 years
Equipment $5,000 Straight-line 5 years
Library books $1 Straight-line 10 years
Software $5,000 Straight-line 15 years
Compensated Absences
Compensated absences consist of Paid Time Off
(PTO). PTO provides time off to cover vacation,
sick leave, and personal/emergency leave. All
regular fulltime, benefits-eligible, non-temporary
employees, including resident
faculty scheduled to work less than twelve
months annually, are eligible to accrue PTO
leave credit.
In June 2011, the District approved changes to
the existing policy regarding PTO accrual and
payout upon termination. Under prior policy
PTO was payable based on consecutive years of
service as follows: employees with 90 days – 2
years of service are compensated at 25 percent
of the accrued amount, employees with 3 – 5
years receive 50 percent of the accrued
amount, employees with 6 – 8 years completed
service are paid 75 percent of the accrued
amount, and employees with 9+ years of
completed service receive 100 percent of the
accrued amount.
The prior policy also included accrued sick leave
benefits. Sick leave provided for ordinary sick
pay and was cumulative through June 30, 2005
at which point the benefit was eliminated and
those with a balance were allowed to retain
their existing balance. The District’s policy
allowed for a payout of five dollars per hour for
sick leave hours only for employees who had 15
years of service or more.
The newly adopted policy paid out all existing
sick leave reserve removing all liabilities
associated with the benefit. It also established
new percentages for termination payout and
lower accrual rates for all PTO eligible
employees. The new payout percentages allow
for a 50% payout of PTO after 5 years of service
and 100% after 10 years. Additionally, accrual
rates were reduced for all PTO eligible staff.
Each employee is subject to a cap on PTO
termination pay equal to 1.5 times his/her
annual accrual. With reduced annual accruals
and the change in payout percentages the
District reduced its compensated absences
liability by adopting the new PTO policy.
Accordingly, an estimate for vested PTO is
accrued as a liability in the financial statements.
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 31 | P a g e Annual Report 2010-2011
Employees may accrue up to 480 hours but are
subject to the aforementioned cap on hours
that may apply to termination payout.
Investment Income
Investment income is composed of interest,
dividends, and net changes in the fair value of
applicable investments.
Scholarship Allowances
A scholarship allowance is the difference
between the stated charge for goods and
services provided by the District and the
amount that is paid by the student or third
parties making payments on behalf of the
student. Accordingly, some types of student
financial aid, such as Pell grants and
scholarships awarded by the District, are
considered to be scholarship allowances. These
allowances are netted against tuition and fees
revenues in the statement of revenues,
expenses, and changes in net assets.
Note 2 – Deposits and Investments
Arizona Revised Statutes (A.R.S.) requires the
District to deposit special tax levies for the
District’s maintenance or capital outlay with the
County Treasurer. The statutes do not require
the District to deposit other monies in its
custody with the County Treasurer; however,
the District must act as a prudent person
dealing with the property of another when
making investment decisions about those
monies. The statutes do not include any
requirements for credit risk, custodial credit
risk, concentration of credit risk, interest rate
risk, or foreign currency risk for the District’s
investments.
The District has adopted a formal investment
policy which seeks to maximize FDIC coverage
primarily through the Certificate of Deposit
Account Registry Service (CDARS) program.
Funds deposited to a single banking institution
are spread out among numerous participating
banks to ensure the total deposit amount at any
single institution does not exceed FDIC
coverage limits. The policy does not formally
establish policy for credit risk, custodial custody
risk, concentration of credit risk, or foreign
currency risk.
Deposits
At June 30, 2011, the total cash on hand was
$2,130. The carrying amount of the District’s
deposits was $3,627,449.
Investments
The District’s investments at June 30, 2011,
were as follows:
Investment Type Fair Value
County Treasurer’s
Investment Pool
$48,035
Certificates of Deposit
(CDARS)*
$2,000,000
Certificates of Deposit
(CDARS)**
$3,002,544
Total $5,050,579
* Original maturity less than 90 days.
** Original maturity greater than 90 days and
less than 1 year.
No oversight is provided for the County
Treasurer’s investment pool, and that pool’s
structure does not provide for shares.
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 32 | P a g e Annual Report 2010-2011
Credit Risk
The District does not have a formal policy with
respect to credit risk. At June 30, 2011, credit
risk for the District’s investments was as
follows:
Interest Rate Risk
As a means of limiting its exposure to fair value
losses arising from rising interest rates, the
District’s policy limits investments to maturities
of less than one year. The District’s investments
and their corresponding maturities at June 30,
2011 are listed to the right.
A reconciliation of cash, deposits and investments to amounts shown on the Statement of Net Assets
follows:
Cash, deposits, and investments: Statement of Net Assets:
Cash on hand $2,129 Cash and cash equivalents $5,571,073
Amount of deposits 3,627,449 Short-term investments 3,002,544
Amount of investments 5,050,579 Restricted assets:
Cash and cash equivalents 106,540
Total $8,680,157 Total $8,680,157
Investment
Type Rating
Rating
Agency Amount
County
Treasurer’s
Investment
Pool
Unrated
Not
applicable
$48,035
Investment Type Amount
Less than 1
Year
County Treasurer’s
Investment Pool
$48,035 $48,035
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 33 | P a g e Annual Report 2010-2011
Note 3 - Receivables
Receivables at June 30, 2011 consist of the
following:
Category Amount
Accounts $107,108
Property taxes 1,783,956
Government Grants and
Contracts
749,197
Student Receivables, net of
allowance of $393,127
76,118
Due from Federal Government 353,830
Interest 1,752
$3,071,961
Property taxes receivable represents taxes
levied by the District which have yet to be
collected. The County has maintained a
historical collection rate close to 100%. As a
result the District does not provide for
allowance for doubtful tax collections. Student
receivables are reported as net of the allowance
for doubtful accounts. Due from Federal
Government represents Federal Students Loans
disbursed to students but not yet drawn down
from the Department of Education by the
District as of June 30, 2011.
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 34 | P a g e Annual Report 2010-2011
Note 4 – Capital Assets
Balance
June 30, 2010 Increases Decreases Balance
June 30, 2011
Capital assets not being depreciated:
Land $638,098 $638,098
Construction in progress 137,804 $178,632 $137,805 178,631
Total capital assets not being depreciated 775,902 178,632 137,805 816,729
Capital assets being depreciated:
Buildings and improvements 23,267,839 1,645,376 24,913,215
Improvements other than buildings 3,015,998 351,927 3,367,925
Equipment 3,085,264 488,780 243,729 3,330,316
Library books 1,740,596 55,477 1,796,073
Software systems 1,092,100 117,800 1,209,900
Total capital assets being depreciated 32,201,797 2,659,361 243,729 34,617,429
Less accumulated depreciation for:
Buildings and improvements 10,890,250 718,294 11,608,544
Improvements other than buildings 2,062,178 215,105 2,277,283
Equipment 1,646,212 438,798 237,405 1,847,605
Library books 1,668,306 19,806 1,688,111
Software systems 175,017 76,079 251,096
Total accumulated depreciation 16,441,963 1,468,082 237,405 17,672,639
Total capital assets being depreciated, net 15,759,834 $1,191,279 6,324 16,944,790
Capital assets, net $16,535,736 $1,369,911 $144,129 $17,761,519
The District was engaged in several capital improvement projects at June 30, 2011. The construction in
progress projects includes science lab remodels on the Kingman and Lake Havasu campuses along with
the build out of existing space in the Detroit Avenue Center. The center, used for Nursing instruction, is
a capital lease of an asset held by the Foundation. The Foundation recognizes the building as a capital
lease receivable as the lease agreement demands payment from the District. The District recognizes this
as a physical asset as it must be recognized as a capital lease in accordance with GASB standards. The
Foundation’s assets are offset by a mortgage liability with the financing bank and the District’s assets are
offset by a capital lease payable to the Foundation.
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 35 | P a g e Annual Report 2010-2011
Note 5 – Long-Term Liabilities
The following schedule details the District’s long-term liability activity for fiscal year ended June 30, 2011.
Balance
June 30, 2010 Additions Reductions Balance
June 30, 2011
Due Within
One Year
Revenue refunding bonds
payable $ 3,340,000 $ - $ 5,000 $ 3,335,000 $ 5,000
Pledged revenue obligations 6,875,000 - 5,915,000 960,000 $ 80,000
Capital leases payable 181,102 1,318,778 189,265 $ 1,310,615 87,090
Total long-term debt $ 10,396,102 $ 1,318,778 $ 6,109,265 $ 5,605,615 $ 172,090
Balance
June 30, 2010 Additions Reductions Balance
June 30, 2011
Due Within
One Year
Compensated absences
payable $ 829,313 $ 510,052 $ 910,611 $ 428,754 $ 2,521
Pledged revenue obligations – The District’s
pledged revenue obligations issued under the
terms of agreements with the trustee are
generally callable. The obligations mature in 1
to 10 years. Principal and interest are payable
from and secured by the District’s tuition, fees,
rentals, and other charges paid by student,
faculty, and others.
The proceeds from the Series 2000 Pledged
Revenue Obligations, issued in the amount of
$4,350,000 were used to construct new
classrooms and revenue producing facilities and
for repairs, improvements, and renovations to
existing buildings. The remaining balance was
paid in December 2010.
The proceeds from the Series 2001 Pledged
Revenue Obligations, issued in the amount of
$4,630,000, were used to advance refund older,
higher rate Certificates of Participation. The
entire balance of the Certificates of
Participation was paid prior to June 30, 2011.
The remaining balance of the Series 2001
Pledged Revenue Obligations was paid in
December 2010.
Proceeds from the Services 2005 Pledged
Revenue Obligations, issued during fiscal year
2005-2006 in the amount of $1,325,000, were
used to: (i) design construct, furnish and equip a
classroom building, (ii) pay the premium of
$22,174 for municipal bond insurance policy for
the Series 2005 Obligations and (iii) pay all legal,
financial and other costs of $83,194 relating to
the execution and delivery of the Series 2005
Obligations. The total principal and interest
remaining to be paid on the bonds is $960,000
and $205,514, respectively. Principal and
interest paid for the current year and total
pledged revenue obligations are expected to
require less than 50 percent of pledged
revenues through fiscal year 2020.
In 2010 the 2000 and 2001 pledged revenue
obligations became callable. The District
Governing Board approved the use of
unrestricted net assets to pay these obligations
in full. In December 2010 the District paid out
$5,835,000 in outstanding principal and
$119,772 in prorated interest to formally pay
off the 2000 and 2001 pledged revenue
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 36 | P a g e Annual Report 2010-2011
obligations. The District’s pledged revenue
obligations at June 30, 2011 are summarized
below.
 Proceeds of the Series 2005 Pledged
Revenue Obligations, issued during
fiscal year 2005-2006 in the amount of
$1,325,000, were primarily used to
design, construct, furnish and equip a
classroom building.
Description Original
Amount
Maturity
Ranges
Interest
Rates
Outstanding
Principal
Series 2000 4,350,000 3/1/10-15 5.50% $ 0
Series 2001 4,630,000 3/1/08-15 3.75-5.25% $ 0
Series 2005 1,325,000 9/1/07-20 3.5-4.125% $ 960,000
The schedule of debt service to maturity for the District’s pledged revenue obligations is shown below.
Principal Interest
2011-12 $80,000 $36,326
2012-13 $85,000 $33,354
2013-14 $85,000 $30,188
2014-15 $90,000 $26,906
2015-16 $95,000 $23,438
2017-2021 $525,000 $56,203
Total $960,000 $206,414
Revenue Refunding Bonds – The District’s
revenue refunding bonds consist of Series 2006
bonds that are generally callable with interest
payable semiannually. The bond proceeds were
used to refund the Series 2000 Revenue Bonds.
The revenue refunding bonds are repaid from
tuition, fees, rentals and other charges paid by
students, faculty and others. The total principal
and interest remaining to be paid on the
revenue refunding bonds is $4,324,188.
Principal and interest paid for the current year
were $5,000 and $140,258, respectively. Annual
principal and interest payments on the pledged
revenue obligations are expected to require less
than 50 percent of pledged revenues.
In prior years, the District paid off certain
revenue bonds by placing the proceeds of new
bonds in an irrevocable trust to provide for all
future debt service payments on the old
revenue bonds. Accordingly, the trust accounts
assets and the liabilities for these revenue
bonds are not included in the District’s financial
statements. At June 30, 2011, revenue bonds in
the amount of $3,150,000 were considered
defeased.
Information on the District’s outstanding
revenue refunding bonds including the debt
schedule to maturity is shown below.
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 37 | P a g e Annual Report 2010-2011
Pledged refunding bonds debt service to maturity are as follows:
Capital Leases - The District has acquired
equipment and a learning center under the
provisions of various long-term lease
agreements classified as capital leases for
accounting purposes because the agreements
fall under one of the following:
 provide for a bargain purchase option
 have a lease period that exceeds 75% of
the estimated life of the asset
 include a transfer of ownership by the
end of the lease term
The classroom building lease is considered a
capital lease payable to the Foundation. Further
information on the lease is highlighted in note
number four of this financial report.
Information on the District’s capital leases is
illustrated on the right.
Description Original Amount Maturity Ranges Interest Outstanding Principal
Series 2006 $3,490,000 3/1/08-20 4.0-4.25% $3,335,000
Principal Interest
2011-12 $5,000 $140,125
2012-13 $10,000 $139,925
2013-14 $10,000 $139,525
2014-15 $10,000 $139,125
2015-16 $610,000 $138,725
2017-2020 $2,690,000 $291,763
Total $3,335,000 $989,188
Capital leases
Buildings $1,550,169
Accumulated depreciation $(9,689)
Equipment $91,753
Accumulated depreciation ($34,827)
Carrying value $1,597,364
Capital lease obligations
2011-12 $149,802
2012-13 $149,802
2013-14 $128,694
2014-15 $125,787
2015-16 $979,363
Total minimum lease payments $1,533,448
Amount representing interest ($222,833)
Present value of minimum lease
payments
$1,310,615
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 38 | P a g e Annual Report 2010-2011
Note 6 – Risk Management
The District is exposed to various risks of loss
related to torts; theft of, damage to, and
destruction of assets; errors and omissions;
injuries to employees; and natural disasters.
The District participates with other community
college districts and Arizona school districts in
the Arizona School Risk Retention Trust, Inc., a
public entity risk pool. The Trust insures the
District against liabilities arising from general
liability, professional liability, property, and
commercial crime risks. The Trust’s operating
agreement includes a provision for member
assessment in the event that total claims paid
by The Trust exceed the contributions and
reserves in any one year. The assessment is
limited to the contribution amount paid by the
District during the year in which the assessment
is applied.
Should the District withdraw from the
Consortium, the District would then be
responsible for its proportional share of claims
and would forfeit all rights to the return of any
surplus, unearned contributions, or other legally
permitted distributions from the Consortium.
Whether the District withdraws or the
Consortium becomes insolvent, the District
remains liable for assessments for liabilities of
the Consortium incurred during the District’s
period of membership in the Consortium.
The Trust has never had such an assessment.
The District also carries commercial insurance
for other risks of loss, including: workers’
compensation and student field trips.
The District is a member of the Mohave Schools
Insurance Consortium, which provides life
insurance and medical, dental and vision
benefits to eligible employees of Consortium
members. An independent administrator
provides the Consortium with claims and
recordkeeping services. The District is
responsible for paying the premiums for eligible
employees, but requires employees to pay
premiums for spousal and dependent coverage.
Note 7 – Operating Leases
The District leases equipment under the
provisions of various long-term lease
agreements classified as operating leases for
accounting purposes. The District’s leases
include numerous copy machines and mailing
machines. Lease expenditures under the terms
of the operating leases were $179,556 for the
year ended June 30, 2011. The future minimum
payments required under the operating leases
at June 30, 2011, were as follows:
Note 8 – Retirement Plan
The District contributes to a cost-sharing,
multiple-employer defined benefit pension
plan; a cost-sharing, multiple-employer defined
benefit health care plan; and a cost-sharing,
multiple-employer defined benefit long-term
disability plan, all of which are administered by
the Arizona State Retirement System. The
Arizona State Retirement System (through its
Retirement Fund) provides retirement (i.e.,
pension), death, and survivor benefits; the
Health Benefit Supplement Fund provides
health insurance premium benefits (i.e., a
monthly subsidy); and the Long-Term Disability
Fund provides long-term disability benefits.
Benefits are established by state statute. The
System is governed by the Arizona State
2011-12 $81,111
2012-13 $6,818
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 39 | P a g e Annual Report 2010-2011
Retirement System Board according to the
provisions of A.R.S. Title 38, Chapter 5, Article 2.
The System issues a comprehensive annual
financial report that includes financial
statements and required supplementary
information. The most recent report may be
obtained by writing to the Arizona State
Retirement System, 3300 North Central Avenue,
P.O. Box 33910, Phoenix, AZ 85067-3910 or by
calling (602) 240-2000 or (800) 621-3778.
The Arizona State Legislature establishes and
may amend active plan members’ and the
District’s contribution rates. For the year ended
June 30, 2011, active plan members were
required by statute to contribute at the
actuarially determined rate of 9.85 percent
(9.6 percent for retirement and 0.25 percent for
long-term disability) of the members’ annual
covered payroll and the District was required by
statute to contribute at the actuarially
determined rate of 9.85 percent (9.01 percent
for retirement, 0.59 percent for health
insurance premium, and 0.25 percent for long-term
disability) of the members’ annual covered
payroll.
The District’s contributions for the current and
2 preceding years, all of which were equal to
the required contributions, were as follows:
Note 9 – Subsequent Events
In the beginning of the 2011-12 fiscal year the
District finalized an agreement with the Legacy
Foundation (an unrelated foundation based in
Phoenix with a local chapter located in Mohave
County) regarding the donation of a new
classroom building to be built on the
Bullhead City campus. The building will house
the new Radiologic Technology program as well
as provide updated science labs for other
instructional areas. The construction will be
funded through reoccurring payments made
directly from the Legacy Foundation with the
District covering necessary cash flows required
for construction in between payments.
Note 10 – Operating Expenses
The District’s operating expenses are presented
by functional classification in the Statement of
Revenues, Expenses, and Changes in Net Assets.
The operating expenses can also be classified
into the following:
Personnel Services $20,180,416
Contract Services 2,765,608
Supplies & Other Services 2,380,083
Communications & Utilities 1,119,185
Scholarships 7,881,955
Depreciation 1,468,082
Other 691,700
Total $36,487,029
Retirement Fund Health Benefit Fund Long-Term Disability Fund
2010-11 $ 1,168,614 $ 76,844 $ 32,433
2009-10 $ 1,023,920 $ 81,030 $ 49,108
2008-09 $ 935,036 $ 121,602 $ 59,030
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 40 | P a g e Annual Report 2010-2011
Note 11 – Discretely Presented Component
Unit Disclosures
NOTE A – Organization
Mohave County Community College
Foundation, Inc. (MCCF) was incorporated in
Arizona in 1977. MCCF’s primary purpose is to
support education through the Mohave
Community College (MCC). MCCF is considered
a component unit of MCC. Therefore, these
financial statements are included as a
component unit of the primary government
entity. These financial statements represent
only the financial position and operations of
MCCF as a discretely presented component
unit.
MCCF supports education by using the
contributions they receive to provide
scholarships, capital improvements, and other
services for the benefit of MCC’s students,
faculty, staff, administration and community.
Funding for MCCF comes primarily from
contributions and investment income.
NOTE B – Summary of significant accounting
policies
Financial statement presentation
MCCF follows the accounting standards issued
under the Financial Accounting Standards Board
(FASB). MCCF is required under generally
accepted accounting principles to report
information regarding its financial position and
activities according to three classes of net
assets: unrestricted, temporarily restricted and
permanently restricted.
Use of estimates
The preparation of financial statements in
conformity with generally accepted accounting
principles requires management to make
estimates and assumptions that affect the
reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at
the date of the financial statements and the
reported amounts of revenues and expenses
during the reporting period. Actual results
could differ from those estimates.
Cash and cash equivalents
MCCF considers all cash and highly liquid
investments with an original maturity of three
months or less to be cash equivalents. MCCF
maintains its cash in bank deposit accounts,
which, for short periods of time, may exceed
federally insured limits. At June 30, 2011, there
were no funds in excess of insured limits.
Investments
Investments in marketable securities with
readily determinable fair values and all
investments in debt securities are stated at
their fair values in the statements of financial
position. Unrealized gains or losses are
included in the change in net assets in the
accompanying statements of activities.
Property and equipment
Purchased equipment is carried at cost.
Donated equipment is carried at the
approximate fair value at the date of donation.
Depreciation is computed using the straight-line
method over the estimated useful lives of the
assets, from 5 to 39 years. MCCF capitalizes all
expenditures for equipment with a useful life of
more than one year and greater than $5,000.
Contributions/restricted revenue
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 41 | P a g e Annual Report 2010-2011
Contributions received are recorded as
unrestricted, temporarily restricted or
permanently restricted support depending on
the existence and/or nature of any donor
restrictions. When a restriction expires,
temporarily restricted net assets are reclassified
to unrestricted net assets and reported in the
statements of activities as net assets released
from restrictions.
Endowments
MCCF’s endowments consist of several
individual funds established for specific
purposes under either donor restriction or as
designated by the Board of Directors. As
required by generally accepted accounting
principles, net assets associated with
endowment funds are classified and reported
based on the existence or absence of donor-imposed
restrictions.
The State of Arizona adopted the Uniform
Prudent Management of Institutional Funds Act
(UPMIFA) (the Act). The Board of Directors of
MCCF has interpreted the Act as requiring the
preservation of the fair value of the original gift
as of the gift date of the donor-restricted
endowment funds absent explicit donor
stipulations to the contrary. As a result of this
interpretation, MCCF classifies as permanently
restricted net assets (a) the original value of
gifts donated to the permanent endowment, (b)
the original value of subsequent gifts to the
permanent endowment, and (c) accumulations
to the permanent endowment made in
accordance with the direction of the applicable
donor gift instrument at the time the
accumulation is added to the fund. The
remaining portion of the donor-restricted
endowment fund that is not classified in
permanently restricted net assets is classified as
temporarily restricted net assets until those
amounts are appropriated for expenditure by
the organization in a manner consistent with
the standard of prudence prescribed by the Act.
In accordance with the Act, MCCF considers the
following factors in making a determination to
appropriate or accumulate endowment funds:
(1) The duration and preservation of the
fund
(2) The purposes of the organization and
the donor-restricted endowment fund
(3) General economic conditions
(4) The possible effect of inflation and
deflation
(5) The expected total return from income
and the appreciation of investments
(6) Other resources of the organization
(7) The investment policies of the
organization.
Donated goods, facilities and services
Donated goods and facilities are valued at their
fair market value. Donated services are
recognized in the financial statements at their
fair market value if the following criteria are
met:
• The services require specialized skills and
the services provided by individuals
possessing those skills.
• The services would typically need to be
purchased if not donated.
Although MCCF may utilize the services of
outside volunteers, the fair value of these
services has not been recognized in the
accompanying financial statements since they
do not meet the criteria for recognition under
generally accepted accounting principles.
Advertising
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 42 | P a g e Annual Report 2010-2011
MCCF expenses all advertising costs as incurred.
Alumni projects
MCCF promotes alumni relations through
mailings and promotion of the College
throughout the community. For the year ended
June 30, 2011, expenses in alumni projects
were mainly spent on plaques that were
distributed around Mohave County showing the
impact of MCCF in the community, as well as
costs for maintaining updated donor mailing
lists.
Donor/recipient events
MCCF organizes events to recognize donors.
Expenses in this category include catering and
food expenses, printing and professional fees
incurred for the events.
Loan costs
Loan costs were amortized using the straight-line
method over the term of the loan. During
the year ended June 30, 2011, the construction
loan was converted into a mortgage; therefore
the previous loan costs were completely
amortized.
Income tax status
MCCF is exempt from Federal income tax under
Section 501(c)(3) of the Internal Revenue Code.
However, income from certain activities not
directly related to MCCF’s tax-exempt purpose
may be subject to taxation as unrelated
business income. In addition, MCCF qualifies
for the charitable contribution deduction under
Section 170(b)(1)(A)(vi) and has been classified
as an organization other than a private
foundation under Section 509(a)(3).
In accordance with Financial Accounting
Standards Board (FASB) Accounting Standards
Codification (ASC) 740-10, MCCF holds no
uncertain tax positions and, therefore, has no
policy for evaluating them. MCCF’s Form 990,
Return of Organization Exempt from Income
Taxes, and Arizona Form 99, Arizona Exempt
Organization Annual Information Return, are
generally subject to examination by the IRS and
the Arizona Department of Revenue,
respectively, for four years after the date filed.
Reclassifications
Certain accounts in the prior-year financial
statements have been reclassified for
comparative purposes to conform with the
presentation in the current-year financial
statements.
NOTE C - Investments
Investments in marketable securities held by
MCCF at June 30, 2011 consisted of the
following:
2011
Mutual funds $2,268,989
Stocks 89,644
Bonds 96,582
Unit trusts 72,202
2,527,417
Less investments for
permanently
restricted endowments (941,732)
$1,585,685
Investment income consisted of the following
for the year ended June 30, 2011:
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 43 | P a g e Annual Report 2010-2011
2011
Realized gains $ 2,454
Unrealized gains 292,928
Dividend/interest income 70,404
$ 365,786
NOTE D – Unconditional promises to give
Unconditional promises to give at June 30, 2011
were as follows:
2011
Receivable in less than one year $ 30,000
Receivable in one to five years 60,000
90,000
Less 3% discount to net present
value
(4,268)
$ 85,732
Unconditional promises to give are pledges
from the capital campaign that was held during
fiscal years 2008 through 2010.
NOTE E – Property and equipment
Property and equipment at June 30, 2011
consisted of the following:
2011
Land $ 787,291
Vehicles 28,800
816,091
Less accumulated
depreciation
(15,160)
$ 800,931
NOTE F – Capital lease receivable
During the year ended June 30, 2011, MCCF
entered into a direct financing capital lease with
MCC for the Foundation’s building. At the end
of the lease term, title of the property will
transfer to MCC for a bargain purchase of $1.
Monthly payments are $10,482. Interest
income under this agreement totaled $67,053
for the year ended June 30, 2011. Future capital
lease receivables are as follows:
Year ending June 30, 2012 $ 125,787
2013 125,787
2014 125,787
2015 125,787
2016 979,363
1,482,511
Less interest at 5% (222,388)
$ 1,260,123
NOTE G – Custodial liabilities
Custodial liabilities consist of funds received for
scholarships in which the recipient of the
scholarship has been named. These funds are
passed through MCCF to MCC for the named
individuals.
NOTE H – Note payable
MCCF has a note payable with interest fixed at
5%, monthly principal and interest installments
of $10,482 and a lump sum payment of
$941,545 due in August 2015. The balance of
the note payable at June 30, 2011 totaled
$1,230,123. The note is collateralized by real
property. Future maturities of long-term debt at
June 30, 2011 are as follows:
Year ending June 30, 2012 $ 69,728
2013 69,342
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 44 | P a g e Annual Report 2010-2011
2014 72,889
2015 76,619
2016 941,545
$ 1,230,123
NOTE I – Temporarily restricted net assets
Temporarily restricted net asset activity was as
follows during the year ended June 30, 2011:
Beginning
balance
Contributions/pledge
discount
Investment
income
Releases
Reclassification of
funds with
deficiencies
Ending
balance
Accumulated endowment
earning on scholarships $ 228,299
$ 203,232 $ (44,850) $ (3,643) $ 383,038
Allied Health Training
Center
134,203
(60,000)
74,203
College for Kids - BHC 1,670 400
(2,070)
0
College for Kids - LHC 791 4,256
(4,958)
89
College for Kids - NCK 0 1,445
(1,445)
0
Disc golf - BHC 126
(126)
0
Other 401 3,896
(1,168)
3,129
Scholarships 55,240 108,381
(131,438)
32,183
Future years operations 7,063 4,466
11,529
$ 427,793 $ 122,844 $ 203,232 $ (246,055) $ (3,643) $ 504,171
NOTE J – Permanently restricted net assets
Permanently restricted net asset activity for
scholarships was as follows for the years ended
June 30, 2011:
2011
Beginning balance $ 925,672
Contributions 14,812
Investment income 1,248
Ending balance $ 941,732
NOTE K – Board designated net assets
MCCF had the following board designated net
assets at June 30, 2011:
2011
Kingman chapter $ 47,875
Lake Havasu City chapter 83,223
Bullhead City chapter 32,530
Foundation operations 58,604
Endowments 976,284
General fund 18,465
Fischer trust 0
Macartney trust 0
$ 1,216,981
NOTE L – Endowments
Funds with deficiencies
From time to time, the fair value of assets
associated with individual donor-restricted
endowment funds may fall below the level that
the donor or the Act requires the Organization
to retain as a fund of perpetual duration. In
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 45 | P a g e Annual Report 2010-2011
accordance with generally accepted accounting
principles, deficiencies of this nature that are
reported in unrestricted net assets were $0 and
($3,643) as of June 30, 2011 and 2010,
respectively.
Return objectives and risk parameters
MCCF has adopted investment policies for
endowment assets that attempt to provide a
predictable stream of funding to programs
supported by its endowment while seeking to
maintain the purchasing power of the
endowment assets. Endowment assets include
those assets of donor-restricted funds that the
organization must hold in perpetuity or for a
donor-specified period(s) as well as board-designated
funds. Actual returns in any given
year may vary.
Spending policy
The investment gain target is 8% and the
payout target is 5%. Distribution of income and
investment gains to the college will utilize a
rolling five-year average rate of return to
determine the proportion of fiscal year income
provided to the MCC and the proportion
retained for use by or growth of the
Foundation. Annually, the Investment
Committee will establish the payout rate.
Net assets in the endowment fund consisted of
the following at June 30, 2011:
Fund
deficiencies -
Unrestricted
Board
designated -
Unrestricted
Temporarily
restricted
Permanently
restricted
Total
Balance, June 30, 2010 $ (3,643) $ 887,881 $ 228,299 $ 925,672 $ 2,038,209
Contributions
14,812 14,812
Dividend/interest income
26,556 39,114 578 66,248
Unrealized/realized gains
111,847 164,118 670 276,635
Releases/appropriations
(50,000)
(44,850)
(94,850)
Fund deficiency transfers 3,643
(3,643)
-
Balance, June 30, 2011 $ - $ 976,284 $ 383,038 $ 941,732 $ 2,301,054
See Note 11.I for endowment related activities in temporarily restricted net assets and Note 11.J for
endowment related activities in permanently restricted net assets.
NOTE M – Fair value measurements
Fair value measurements are determined based
on the assumptions—referred to as inputs—
that market participants would use in pricing
the asset. A fair value hierarchy distinguishes
between market participant assumptions and
MCCF’s own assumptions about market
participant assumptions. Observable inputs are
assumptions based on market data obtained
from independent sources, while unobservable
inputs are MCCF’s own assumptions about what
market participants would assume based on the
best information available in the circumstances.
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 46 | P a g e Annual Report 2010-2011
Level 1 inputs. A quoted price in an active
market for an identical asset or liability is
considered to be the most reliable evidence of
fair value. The fair value of MCCF’s marketable
securities are determined by reference to
quoted prices in active markets for identical
assets and other relevant information
generated by market transactions.
Level 2 inputs. These are observable inputs,
either directly or indirectly, other than quoted
prices included within Level 1. MCCF does not
have any Level 2 inputs.
Level 3 inputs. These inputs are unobservable
and are used to measure fair value only when
observable inputs are not available. The fair
value of unimproved land held for investment is
determined by reference to property tax
assessed values and other relevant information
generated by market transactions. The fair
value of unconditional promises to give is
estimated using an interest rate which
approximates the present value of future cash
flows.
Fair values of assets measured on a recurring
basis at June 30, 2011 were as follows:
2011
Marketable securities
(Level 1)
$ 2,527,417
Unimproved land held
for investment (Level 3)
334,986
$ 2,862,403
Changes in Level 3 assets measured at fair value
on a recurring basis using significant
unobservable inputs were as follows:
2011
Beginning balance $ 337,818
Donated land 9,757
Land sold (4,232)
Change in value (8,357)
Ending balance $ 334,986
Fair value of Level 3 assets measured on a non-recurring
basis at June 30, 2011 consisted of
unconditional promises to give of $85,732.
NOTE N – Payments and transfers to MCC
During the year ended June 30, 2011, MCCF
made the following payments and transfers to
MCC or on behalf of MCC:
2011
Scholarships $ 185,928
Capital expenditures 270
Transfer of in-kind
contributions
70,946
Program expenditures 9,006
MCC operations 266,150
Management fees 63,295
Total expenses 329,445
Pass through funds 358,269
Total payments and
transfers
$ 687,714
NOTE O – Related party transactions
MCCF paid a company owned by a board
member for printing services. The total
payments for the year ended June 30, 2011
were $11,984. No amounts were due to this
related party as of June 30, 2011. In addition to
the transactions in Notes 11.F and 11.N, MCCF
owed MCC $18,520 at June 30, 2011 for
scholarships.
[NOTES TO FINANCIAL STATEMENTS] Financial Section
Mohave Community College 47 | P a g e Annual Report 2010-2011
NOTE P – In-kind contributions
2011
In-kind goods and
services passed to MCC
(see Note O)
$ 70,946
In-kind goods and
services for MCCF
8,042
Total in-kind expense 78,988
Land held for investment 9,757
Total in-kind revenues $ 88,745
NOTE Q – Functional expenses
During the year ended June 30, 2011, MCCF had
the following functional expense breakdown:
2011
Program $ 407,497
Management and
general
98,256
Fundraising, including
direct donor benefit
58,330
Total expenses $ 564,083
NOTE R – Prior period restatement
During the year ended June 30, 2011, the following correction was made to net assets at June 30, 2010:
Unrestricted
net assets
Temporarily
restricted net
assets
Permanently
restricted net
assets
Total
Balance at June 30, 2010, as originally reported $ 2,345,873 $ 427,793 $ 925,672 $ 3,699,338
Restatement 66,653 - - 66,653
Balance at June 30, 2010, as restated $ 2,412,436 $ 427,793 $ 925,672 $ 3,765,901
[STATISTICAL SECTION DEFINITIONS] Statistical Section
Mohave Community College 48 | P a g e Annual Report 2010-2011
In accordance with Governmental Accounting Standards Board Statement No. 44, Economic Condition
Reporting: The Statistical Section the District has compiled data to address the following key areas
relating to the overall economic condition of the institution.
 Financial Trends
Information in this section assists readers in understanding and assessing how the District’s financial
position has changed over time
 Revenue Capacity
Information in this section assists readers in understanding and assessing the factors affecting the
District’s ability to generate revenues
 Debt Capacity
Information in this section assists readers in understanding and assessing the District’s debt burden and
its ability to acquire additional debt
 Demographic and Economic Information
Information in this section assists readers in understanding and assessing the demographic and
economic environment in which the District operates
 Operating Information
Information in this section assists readers in understanding and assessing data relating to capital assets
and services provided by the District’s financial resources
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 49 | P a g e Annual Report 2010-2011
Net Assets by Component 2005-06 2004-05 2003-04 2002-03 2001-02
Invested in Capital Assets, Net $ 4,971,770 $ 4,478,623 $ 4,101,290 $ 3,553,967 $ 4,062,389
Restricted $ 585,244 $ 967,148 $ 1,383,656 $ 757,973 $ 965,912
Unrestricted $ 3,688,809 $ 2,985,704 $ 1,644,949 $ 1,610,556 $ 1,865,784
$ 9,245,823 $ 8,431,475 $ 7,129,895 $ 5,922,496 $ 6,894,085
$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
Unrestricted
Restricted
Invested in Capital Assets, Net
Net Assets by Component 2010-11 2009-10 2008-09 2007-08 2006-07
Invested in Capital Assets, Net $ 12,155,904 $ 6,139,634 $ 4,641,128 $ 4,981,341 $ 4,479,547
Restricted $ 257,540 $ 194,575 $ 86,844 $ 313,737 $ 335,423
Unrestricted $ 10,373,663 $ 11,057,133 $ 9,130,281 $ 6,529,590 $ 5,424,426
$ 22,787,108 $ 17,391,342 $ 13,858,253 $ 11,824,668 $ 10,239,396
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 50 | P a g e Annual Report 2010-2011
2010-11 2009-10 2008-09 2007-08 2006-07
Change in Net Assets $ 5,395,766 $ 3,533,089 $ 2,033,585 $ 1,585,272 $ 993,573
Net Assets $ 22,787,108 $ 17,391,342 $ 13,858,253 $ 11,824,668 $ 10,239,396
2005-06 2004-05 2003-04 2002-03
Change in Net Assets $ (381,904) $ (416,508) $ 625,683 $ (207,939)
Net Assets $ 9,245,823 $ 8,431,475 $ 7,129,895 $ 5,922,496
Changes in Net Assets
$5,395,766
$3,533,089
$2,033,585
$1,585,272
$993,573 $814,348
$1,301,580 $1,207,399
$(2,000,000) $(971,589)
$(1,000,000)
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
2010-11 2009-10 2008-09 2007-08 2006-07 2005-06 2004-05 2003-04 2002-03
Change in Net Assets
54%
1%
45%
Net Asset Composition 2010-11
Invested in Capital Assets, Net
Restricted
Unrestricted
59%
14%
27%
Net Asset Composition 2001-02
Invested in Capital Assets, Net
Restricted
Unrestricted
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 51 | P a g e Annual Report 2010-2011
Operating Revenues 2010-11 2009-10 2008-09 2007-08 2006-07
Tuition and fees 4,526,951 4,168,056 4,510,286 3,296,204 3,512,519
Government grants and contracts - - - - 5,998,550
Private grants and contracts 726,101 592,730 329,024 573,216 253,528
Bookstore income 134,039 222,703 246,254 202,379 184,053
Food service income 26,540 42,183 37,971 37,618 33,845
Other sales and services 113,113 117,277 127,807 153,672 291,519
Other 16,200 46,356 43,466 27,329 50,749
Total Operating Revenues 5,542,944 5,189,305 5,294,808 4,290,418 10,324,763
Operating Expenses
Instruction 10,743,772 9,502,581 8,569,285 7,892,400 7,184,340
Public Service 134,167 144,167 118,520 114,126 79,694
Academic Support 3,798,199 4,106,925 3,696,088 3,591,507 3,519,967
Student Services 3,310,869 3,009,029 3,844,024 3,424,680 3,453,928
Institutional Support 6,118,714 7,578,624 7,981,597 7,213,810 6,850,217
Operation and Maintenance of Plant 2,757,453 2,871,130 2,684,752 2,476,724 2,382,022
Scholarships 7,881,955 7,359,327 4,014,019 3,401,656 3,006,796
Auxiliary Enterprises 273,818 280,419 442,944 202,412 237,535
Depreciation 1,468,082 1,479,676 1,417,859 1,265,072 1,179,112
Other
- - - 47,907
Total Operating Expenses 36,487,029 36,331,878 32,769,088 29,582,387 27,941,518
Operating Income (Loss) (30,944,085) (31,142,573) (27,474,280) (25,291,969) (17,616,755)
Non-operating Revenues (Expenses)
Government Grants 14,468,876 13,939,348 9,512,174 6,549,809 -
Property Taxes 18,085,425 17,048,446 16,235,016 15,372,777 14,093,900
State Appropriations 3,682,900 3,682,901 3,748,881 4,196,900 4,196,900
Share of State Sales Tax 506,197 491,718 518,805 554,842 557,376
Private gifts - - - - -
Investment Income 14,792 45,313 77,423 209,642 83,206
Interest Expense of Debt (415,474) (543,786) (583,862) (608,948) (961,933)
Gain (Loss) on Disposal of Capital Assets
(2,865) 11,722 (572) 4,181 6,194
Total Non-operating Revenues (Expenses) 36,339,851 34,675,662 29,507,865 26,279,203 17,975,643
Income (Loss) Before Other Revenues,
Expenses, Gains or Losses 5,395,766 3,533,089 2,033,585 987,234 358,888
Capital Appropriations - - - 591,200 597,500
Capital Grants and Gifts - - - 6,838 37,185
Change in Net Assets 5,395,766 3,533,089 2,033,585 1,585,272 993,573
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 52 | P a g e Annual Report 2010-2011
Operating Revenues 2005-06 2004-05 2003-04 2002-03 2001-02
Tuition and fees 2,990,555 2,810,351 2,778,253 2,122,844 1,921,312
Government grants and contracts 5,952,940 5,170,921 2,682,220 2,182,375 1,881,464
Private grants and contracts 300,912 346,216 259,594 67,934 210,943
Bookstore income 159,473 140,233 383,674 1,249,195 1,207,751
Food service income 38,668 27,792 36,649 33,365 83,228
Other sales and services 339,052 278,613 252,054 221,298 90,650
Other 80,853 80,475 172,195 23,490 167,513
Total Operating Revenues 9,862,453 8,854,601 6,564,639 5,900,501 5,562,861
Operating Expenses
Instruction 6,882,730 6,492,051 5,598,586 5,668,524 5,783,924
Public Service 124,169 91,821 105,118 118,695 83,262
Academic Support 3,462,743 2,992,161 2,685,363 3,827,995 4,195,865
Student Services 3,315,437 2,762,592 2,408,423 1,262,246 1,344,922
Institutional Support 6,001,049 5,237,170 5,150,994 3,715,656 3,183,542
Operation and Maintenance of Plant 2,434,154 2,435,786 1,837,077 1,513,825 1,599,692
Scholarships 2,954,737 2,733,955 1,942,755 1,680,538 1,706,035
Auxiliary Enterprises 228,419 190,639 415,948 1,595,387 1,540,994
Depreciation 1,087,742 996,621 944,514 996,721 861,236
Other 23,003 160 160 10,497 2,927
Total Operating Expenses 26,514,183 23,932,956 21,088,938 20,390,084 20,302,399
Operating Income (Loss) (16,651,730) (15,078,355) (14,524,299) (14,489,583) (14,739,538)
Non-operating Revenues (Expenses)
Government Grants
Property Taxes 13,274,304 11,762,842 10,873,474 9,515,110 9,289,567
State Appropriations 3,710,000 3,710,000 3,630,300 3,630,300 3,944,700
Share of State Sales Tax 517,428 418,297 404,124 382,268 362,756
Private gifts - - - 84,887 139,051
Investment Income 139,212 90,126 58,054 101,787 72,618
Interest Expense of Debt (798,623) (658,756) (657,371) (903,437) (634,197)
Gain (Loss) on Disposal of Capital Assets 10,976 (30,800) 31,017 37,661 (405,933)
Total Non-operating Revenues (Expenses) 16,853,297 15,291,709 14,339,598 12,848,576 12,768,562
Income (Loss) Before Other Revenues,
Expenses, Gains or Losses 201,567 213,354 (184,701) (1,641,007) (1,970,976)
Capital Appropriations 491,000 492,000 440,400 440,400 470,900
Capital Grants and Gifts 121,781 596,226 951,700 229,018 47,530
Change in Net Assets 814,348 1,301,580 1,207,399 (971,589) (1,452,546)
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 53 | P a g e Annual Report 2010-2011
Expenses by Function 2010-11 2009-10 2008-09 2007-08 2006-07
Instruction 10,743,772 9,502,581 8,569,285 7,892,400 7,184,340
Public Service 134,167 144,167 118,520 114,126 79,694
Academic Support 3,798,199 4,106,925 3,696,088 3,591,507 3,519,967
Student Services 3,310,869 3,009,029 3,844,024 3,424,680 3,453,928
Institutional Support 6,118,714 7,578,624 7,981,597 7,213,810 6,850,217
Operation and Maintenance of Plant 2,757,453 2,871,130 2,684,752 2,476,724 2,382,022
Scholarships 7,881,955 7,359,327 4,014,019 3,401,656 3,006,796
Auxiliary Enterprises 273,818 280,419 442,944 202,412 237,535
Depreciation 1,468,082 1,479,676 1,417,859 1,265,072 1,179,112
Other Operating expenses 47,907
Total Expenses 36,487,029 36,331,878 32,769,088 29,582,387 27,941,518
Operating Expenses
0%
Instruction
29%
Public
Service
<1%
Academic Support
10%
Student Services
9%
Institutional
Support
Operation 17%
and
Maintenance
of Plant
8%
Scholarships
22%
Auxiliary
Enterprises
1%
Depreciation
4%
Other
0%
Operating Expenses 2010-11
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 54 | P a g e Annual Report 2010-2011
Expenses by Function 2005-06 2004-05 2003-04 2002-03 2001-02
Instruction 6,882,730 6,492,051 5,598,586 5,668,524 5,783,924
Public Service 124,169 91,821 105,118 118,695 83,262
Academic Support 3,462,743 2,992,161 2,685,363 3,827,995 4,195,865
Student Services 3,315,437 2,762,592 2,408,423 1,262,246 1,344,922
Institutional Support 6,001,049 5,237,170 5,150,994 3,715,656 3,183,542
Operation and Maintenance of Plant 2,434,154 2,435,786 1,837,077 1,513,825 1,599,692
Scholarships 2,954,737 2,733,955 1,942,755 1,680,538 1,706,035
Auxiliary Enterprises 228,419 190,639 415,948 1,595,387 1,540,994
Depreciation 1,087,742 996,621 944,514 996,721 861,236
Other Operating expenses 23,003 160 160 10,497 2,927
Total Expenses 26,514,183 23,932,956 21,088,938 20,390,084 20,302,399
Instruction
28%
Public
Service
<1%
Academic Support
21%
Student Services
7%
Institutional
Support
16%
Operation and
Maintenance of
Plant
8% Scholarships
8%
Auxiliary
Enterprises
8%
Depreciation
4%
Other
<1%
Operating Expenses 2001-02
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 55 | P a g e Annual Report 2010-2011
Expenses by Object 2010-11 2009-10 2008-09 2007-08 2006-07
Personnel Services 20,180,416 20,130,234 18,591,648 17,361,878 16,749,980
Contract Services 2,765,608 3,439,247 4,245,764 4,069,571 3,430,817
Supplies and Other Services 2,380,083 2,313,898 2,442,046 2,247,652 2,204,803
Communications and Utilities 1,119,185 1,024,747 1,098,602 1,065,066 1,078,423
Scholarships 7,881,955 7,359,327 4,014,019 3,401,656 2,761,216
Depreciation 1,468,082 1,479,676 1,417,859 1,265,072 1,179,112
Other 691,700 584,749 959,150 171,492 537,167
Total Expenses 36,487,029 36,331,878 32,769,088 29,582,387 27,941,518
Personnel
Services
55%
Contract
Services
8%
Supplies and
Other Services
6%
Communications
and Utilities
3%
Scholarships
22%
Depreciation
4%
Other
2%
Expenses by Object 2010-11
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 56 | P a g e Annual Report 2010-2011
Expenses by Object 2005-06 2004-05 2003-04 2002-03 2001-02
Personnel Services 15,317,595 13,102,317 12,515,924 13,064,266 12,836,384
Contract Services 3,247,471 2,975,047 2,474,967 1,058,975 794,212
Supplies and Other Services 2,545,080 2,728,839 1,913,344 2,484,561 2,271,283
Communications and Utilities 978,466 935,052 909,273 814,507 793,471
Scholarships 2,954,737 2,733,955 1,942,755 1,680,538 1,706,035
Depreciation 1,087,742 996,621 944,514 996,721 861,236
Other 383,092 461,125 388,161 290,516 1,039,778
Total Expenses 26,514,183 23,932,956 21,088,938 20,390,084 20,302,399
Personnel Services
63%
Contract Services
4%
Supplies and
Other Services
11%
Communications
and Utilities
4%
Scholarships
9%
Depreciation
4%
Other
5%
Expenses by Object 2001-02
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 57 | P a g e Annual Report 2010-2011
Revenues by Source 2010-11 2009-10 2008-09 2007-08 2006-07
Property Taxes 18,085,426 17,048,446 16,235,016 15,372,777 14,093,900
Government Grants 14,378,844 13,939,348 9,512,174 6,549,809 5,998,550
Tuition & Fees 4,195,487 4,168,056 4,510,286 3,296,204 3,512,519
State Appropriations 3,682,901 3,682,901 3,748,881 4,196,900 4,196,900
Share of State Sales Tax 506,198 491,718 518,805 554,842 557,376
Private Grants and Contracts 726,101 592,730 329,024 573,216 253,528
Private Gifts
Investment Income 14,793 45,313 77,423 209,642 83,206
Gain on Disposal of Capital Assets 11,722 4,181 6,194
Bookstore Income 134,039 222,703 246,254 202,379 184,053
Food Service Income 26,540 42,183 37,971 37,618 33,845
Other Sales and Services 113,113 117,277 127,807 153,672 291,519
Other 16,200 46,356 43,466 27,329 50,749
Capital appropriations - 591,200 597,500
Capital grants and gifts 6,838 37,185
Total Revenue 41,879,641 40,408,753 35,387,107 31,776,607 29,897,024
Property Taxes
43%
Government
Grants
34%
Tuition & Fees
10%
State
Appropriations
9%
Share of State
Sales Tax
1%
Private
Grants and
Contracts
2%
Bookstore
Income
<1%
Other
1%
Revenue Sources 2010-11
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 58 | P a g e Annual Report 2010-2011
Revenues by Source 2005-06 2004-05 2003-04 2002-03 2001-02
Property Taxes 13,274,304 11,762,842 10,873,474 9,515,110 9,289,567
Government Grants 5,952,940 5,170,921 2,682,220 2,182,375 1,881,464
Tuition & Fees 2,990,555 2,810,351 2,778,253 2,122,844 1,921,312
State Appropriations 3,710,000 3,710,000 3,630,300 3,630,300 3,944,700
Share of State Sales Tax 517,428 418,297 404,124 382,268 362,756
Private Grants and Contracts 300,912 346,216 259,594 67,934 210,943
Private Gifts 84,887 139,051
Investment Income 139,212 90,126 58,054 101,787 72,618
Gain on Disposal of Capital Assets 10,976 31,017 37,661
Bookstore Income 159,473 140,233 383,674 1,249,195 1,207,751
Food Service Income 38,668 27,792 36,649 33,365 83,228
Other Sales and Services 339,052 278,613 252,054 221,298 90,650
Other 80,853 80,475 172,195 23,490 167,513
Capital appropriations 491,000 492,000 440,400 440,400 470,900
Capital grants and gifts 121,781 596,226 951,700 229,018 47,530
Total Revenue 28,127,154 25,924,092 22,953,708 20,321,932 19,889,983
Property Taxes
47%
Government
Grants
9%
Tuition & Fees
10%
State
Appropriations
20%
Share of State
Sales Tax
2%
Private Grants
and Contracts
2%
Bookstore
Income
6%
Other
2%
Capital
appropriations
2%
Capital grants
and gifts
<1%
Revenue Sources 2001-02
[FINANCIAL TRENDS] Statistical Section
Mohave Community College 59 | P a g e Annual Report 2010-2011
Budgeted Expenditure Limitation
2010-11 2009-10 2008-09 2007-08 2006-07
Statutory Expenditure Limitation $ 34,950,321 $ 31,134,362 $ 24,835,230 $ 22,526,351 $ 23,118,821
Budgeted Expenditures Subject to Limitation $ 28,463,105 $ 31,134,362 $ 24,835,230 $ 22,526,351 $ 20,218,585
Amount Under Expenditure Limitation $ - $ - $ - $ - $ 2,900,236
2005-06 2004-05 2003-04 2002-03 2001-02
Statutory Expenditure Limitation $ 21,009,091 $ 16,619,702 $ 16,163,538 $ 18,472,189 $ 17,652,638
Budgeted Expenditures Subject to Limitation $ 17,718,963 $ 14,841,404 $ 13,861,963 $ 15,337,733 $ 17,441,694
Amount Under Expenditure Limitation $ 3,290,128 $ 1,778,298 $ 2,301,575 $ 3,134,456 $ 210,944
Source: Audited Reports on Annual Budgeted Expenditure Limitation
Note (1) – The Statutory Expenditure Limitation is calculated by the Arizona Department of Revenue
Economic Estimates Commission.
Note (2) – Budgeted expenditures are calculated net of allowable exclusions.
$- $- $- $-
$2,900,236
$3,290,128
$1,778,298
$2,301,575
$3,134,456
$210,944
$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
Budgeted
Expenditures Subject
to Limitation
Amount Under
Expenditure
Limitation
Statutory
Expenditure
Limitation
[REVENUE CAPACITY] Statistical Section
Mohave Community College 60 | P a g e Annual Report 2010-2011
Source: Mohave County Treasurer
93.45%
98.60%
99.33% 99.66%
99.85% 99.96% 99.94% 99.94% 99.92% 99.92%
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
$20,000,000
90.00%
92.00%
94.00%
96.00%
98.00%
100.00%
102.00%
Tax Levy Collections
Total Tax Levy % of Tax Levy Collected Total Collections
[REVENUE CAPACITY] Statistical Section
Mohave Community College 61 | P a g e Annual Report 2010-2011
Source: Mohave County Treasurer
Source: Mohave County Treasurer
0.774
0.679
0.715
0.822
0.901
0.940 0.951 0.941 0.940 0.944
0.4000
0.5000
0.6000
0.7000
0.8000
0.9000
1.0000
1.1000
1.2000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
$20,000,000
Tax Levy Amount and Rate
Tax Levy Amount Tax Rate
$-
$500,000,000
$1,000,000,000
$1,500,000,000
$2,000,000,000
$2,500,000,000
$3,000,000,000
Net Assessed Valuation
[REVENUE CAPACITY] Statistical Section
Mohave Community College 62 | P a g e Annual Report 2010-2011
Assessed Value and Net Assessed Value of All Taxable Property – Last 10 Years (dollars in thousands)
Tax
Year Utilities Commercial Vacant/
Agriculture Residential Railroads
2002 Primary $ 559,038 $ 930,699 $ 1,750,797 $ 4,991,807 $ 46,009
2002 Secondary $ 559,038 $ 968,345 $ 1,916,020 $ 5,068,796 $ 48,414
2003 Primary $ 735,876 $ 1,013,762 $ 1,842,640 $ 5,479,527 $ 43,218
2003 Secondary $ 735,876 $ 1,051,321 $ 2,039,621 $ 5,552,146 $ 46,322
2004 Primary $ 727,443 $ 1,108,810 $ 1,901,438 $ 6,216,392 $ 46,426
2004 Secondary $ 727,443 $ 1,158,872 $ 2,172,883 $ 6,495,834 $ 48,881
2005 Primary $ 646,000 $ 1,214,337 $ 2,065,748 $ 7,090,338 $ 49,898
2005 Secondary $ 646,000 $ 1,344,243 $ 2,580,194 $ 7,798,083 $ 53,900
2006 Primary $ 723,455 $ 1,378,878 $ 2,452,541 $ 8,470,582 $ 56,801
2006 Secondary $ 723,455 $ 1,525,025 $ 3,293,075 $ 9,992,130 $ 59,387
2007 Primary $ 812,597 $ 1,627,884 $ 3,193,031 $ 10,397,328 $ 43,573
2007 Secondary $ 812,599 $ 1,862,248 $ 5,310,457 $ 13,677,619 $ 47,167
2008 Primary $ 870,759 $ 1,869,858 $ 4,273,137 $ 12,309,934 $ 45,291
2008 Secondary $ 870,866 $ 2,259,772 $ 7,660,939 $ 16,615,244 $ 49,652
2009 Primary $ 950,442 $ 2,121,941 $ 5,165,680 $ 13,527,586 $ 42,092
2009 Secondary $ 950,442 $ 2,395,606 $ 8,096,478 $ 15,040,180 $ 47,635
2010 Primary $ 999,461 $ 2,292,834 $ 4,818,197 $ 11,535,591 $ 44,103
2010 Secondary $ 999,461 $ 2,370,512 $ 6,191,328 $ 11,823,140 $ 50,846
2011 Primary $ 982,569 $ 2,064,887 $ 4,017,440 $ 9,408,362 $ 58,821
2011 Secondary $ 982,578 $ 2,092,899 $ 4,590,747 $ 9,469,028 $ 64,168
Source: Mohave County Assessor’s Office
Tax
Year Historic Enterprise
Zone
Environmental
Tech
Capital
Improvements
Net Assessed
Value ALL
2002 Primary $ 1,732 $ - $ 125,315 $ 6 $ 1,044,791
2002 Secondary $ 1,774 $ - $ 125,315 $ 6 $ 1,072,414
2003 Primary $ 1,897 $ - $ 125,019 $ 6 $ 1,159,793
2003 Secondary $ 2,307 $ - $ 128,158 $ 6 $ 1,189,714
2004 Primary $ 1,899 $ - $ - $ 6 $ 1,248,899
2004 Secondary $ 2,108 $ - $ - $ 6 $ 1,316,903
2005 Primary $ 1,963 $ - $ - $ 6 $ 1,352,302
2005 Secondary $ 2,141 $ - $ - $ 6 $ 1,515,016
2006 Primary $ 2,095 $ - $ - $ 6 $ 1,587,595
2006 Secondary $ 2,292 $ - $ - $ 6 $ 1,888,192
2007 Primary $ 2,237 $ 594 $ - $ - $ 1,908,234
2007 Secondary $ 2,564 $ 1,558 $ - $ - $ 2,523,334
2008 Primary $ 2,429 $ 962 $ - $ 1,047 $ 2,274,474
2008 Secondary $ 2,926 $ 1,991 $ - $ 1,090 $ 3,217,317
2009 Primary $ 2,442 $ 1,131 $ - $ - $ 2,520,925
2009 Secondary $ 2,628 $ 1,866 $ - $ - $ 3,032,797
2010 Primary $ 2,379 $ 20,598 $ - $ - $ 2,314,646
2010 Secondary $ 2,556 $ 22,971 $ - $ - $ 2,496,568
2011 Primary $ 1,841 $ 1,386 $ - $ - $ 1,926,852
2011 Secondary $ 1,841 $ 1,898 $ - $ - $ 1,986,954
Source: Mohave County Assessor’s Office
[REVENUE CAPACITY] Statistical Section
Mohave Community College 63 | P a g e Annual Report 2010-2011
Property Tax Rates for Direct and Overlapping Governments – Last 10 Years
Tax Year MCC Primary Levy MCC Secondary Levy MCC Total
2002 $ 0.9398 $ - $ 0.9398
2003 $ 0.9473 $ - $ 0.9473
2004 $ 0.9483 $ - $ 0.9483
2005 $ 0.9404 $ - $ 0.9404
2006 $ 0.8982 $ - $ 0.8982
2007 $ 0.8221 $ - $ 0.8221
2008 $ 0.7152 $ - $ 0.7152
2009 $ 0.6791 $ - $ 0.6791
2010 $ 0.7866 $ - $ 0.7866
2011 $ 0.9779 $ - $ 0.9779
Tax Year
Mohave
County
School Districts
Cities or Fire
Districts
Sanitary or Improvement
Districts
Irrigation &
Drainage Districts
Other Districts
(Water/Lighting)
2002 $ 1.7500 0.5356 - 6.2274 0.3183 - 3.0000 0.0230 - 6.5830 1.12 - 101.11/acre 0.0413 - 258.77/Lot
2003 $ 1.7500 0.4135 - 5.2253 0.3033 - 3.0000 0.0544 - 3.4221 1.13 - 100.77/acre 0.0373 - 219.96/Lot
2004 $ 1.7500 0.4969 - 8.9421 0.2862 - 3.0000 0.0586 - 3.0983 1.25 - 100.74/acre 0.0398 - 219.96/Lot
2005 $ 1.7500 0.4262 - 11.4664 0.2632 - 3.2500 0.0544 - 1.9907 1.33 - 100.74/acre 12.2/acre - 0.0511
2006 $ 1.6777 0.2169 - 11.4664 0.2301 - 3.2500 0.0490 - 1.9907 1.33 - 100.74/acre 3.56/acre - 0.1856
2007 $ 1.5298 0.0500 - 11.4664 0.6704 - 3.2500 0.0266 - 0.6846 1.75 - 100.74/acre 3.56/acre - 2.8776
2008 $ 1.3309 0.0500 - 10.0415 0.6038 - 3.2500 0.0182 - 0.5425 1.75 - 100.74/acre 3.56/acre - 1.5167
2009 $ 1.2637 0.0500 - 9.5000 0.5834 - 3.2500 0.0698 - 0.4769 0.77 - 156.78/acre 3.56/acre - 1.5567
2010 $ 1.4637 0.0500 - 8.5000 0.5834 - 3.2500 0.0841 - 0.4925 1.00 - 212.75 acre 3.56/acre - 1.5474
2011 $ 1.8196 0.0500 - 9.0000 0.7264 - 3.2500 0.0838 - 0.6095 1.00 - 268.86 acre 3.56/acre - 2.6672
Source: Mohave County Finance Office
Note (1) - Mohave County applies to the General and State Education Equalization, and to the General,
Library District and Fire District Assistance Funds. Fire, Sanitary, Improvement, Irrigation, Water and
Lighting District levies are based on secondary values.
[REVENUE CAPACITY] Statistical Section
Mohave Community College 64 | P a g e Annual Report 2010-2011
Historic Resident Tuition Rates – Last 10 Fiscal Years
Tuition Per Credit Hour Annual Cost $ Increase %Increase
2001-02 $ 32 $ 960
2002-03 $ 34 $ 1,020 $ 60 6%
2003-04 $ 38 $ 1,140 $ 120 12%
2004-05 $ 42 $ 1,260 $ 120 11%
2005-06 $ 46 $ 1,380 $ 120 10%
2006-07 $ 50 $ 1,580 $ 200 14%
2007-08 $ 54 $ 1,700 $ 120 8%
2008-09 $ 59 $ 1,870 $ 170 10%
2009-10 $ 64 $ 2,020 $ 150 8%
2010-11 $ 69 $ 2,310 $ 290 14%
Source: District Records
Note (1) – Tuition rate shown is for in-state students. Annual cost based on in-state rate for one year of
full-time equivalent (30 credit hours) plus mandatory semester fees.
$-
$10
$20
$30
$40
$50
$60
$70
$80
Resident Tuition Rates
[DEBT CAPACITY] Statistical Section
Mohave Community College 65 | P a g e Annual Report 2010-2011
Debt Service Coverage – Last 10 Fiscal Years
Note (1) – Pledged revenues include tuition and fees, bookstore income, food service income, sales and
services, and investment income. Tuition and fees are reported minus scholarship allowances.
Note (2) – In 2001-02 revenue bonds were issued to pay remaining principal of $4,205,000 for 1994
Certificates of Participation. In 2006-07 revenue refunding bonds were issued to pay remaining principal
of $3,150,000. In 2010-11 unrestricted net assets were used to pay off the remaining principal of
$3,720,000 and $2,115,000 for the 2000 and 2001 Pledged Revenue Obligations.
Debt Burden Ratio – Last 10 Fiscal Years
Operating Expenses Principal Interest Total
Debt as % of
Operating Expenses
2001-02 $ 20,302,399 $ 4,205,000 $ 685,710 $ 4,890,710 24%
2002-03 $ 20,390,084 $ 150,000 $ 653,040 $ 803,040 4%
2003-04 $ 21,088,938 $ 305,000 $ 647,415 $ 952,415 5%
2004-05 $ 23,932,956 $ 320,000 $ 634,910 $ 954,910 4%
2005-06 $ 26,514,183 $ 335,000 $ 654,037 $ 989,037 4%
2006-07 $ 27,941,518 $ 3,625,000 $ 572,030 $ 4,197,030 15%
2007-08 $ 29,582,387 $ 455,000 $ 587,336 $ 1,042,336 4%
2008-09 $ 32,769,088 $ 465,000 $ 569,146 $ 1,034,146 3%
2009-10 $ 36,331,878 $ 1,075,000 $ 549,934 $ 1,624,934 4%
2010-11 $ 36,487,029 $ 5,920,000 $ 351,063 $ 6,271,063 17%
Pledged Revenues Principal Interest Total
Debt as % of Pledged
Revenue
2001-02 $ 3,375,559 $ 4,205,000 $ 685,710 $ 4,890,710 145%
2002-03 $ 3,728,489 $ 150,000 $ 653,040 $ 803,040 22%
2003-04 $ 3,508,684 $ 305,000 $ 647,415 $ 952,415 27%
2004-05 $ 3,347,115 $ 320,000 $ 634,910 $ 954,910 29%
2005-06 $ 3,666,960 $ 335,000 $ 654,037 $ 989,037 27%
2006-07 $ 4,105,142 $ 3,625,000 $ 572,030 $ 4,197,030 102%
2007-08 $ 3,899,515 $ 455,000 $ 587,336 $ 1,042,336 27%
2008-09 $ 4,999,741 $ 465,000 $ 569,146 $ 1,034,146 21%
2009-10 $ 4,595,532 $ 1,075,000 $ 549,934 $ 1,624,934 35%
2010-11 $ 4,483,972 $ 5,920,000 $ 351,063 $ 6,271,063 140%
[DEBT CAPACITY] Statistical Section
Mohave Community College 66 | P a g e Annual Report 2010-2011
Debt Service Interest Expense – Last 10 Fiscal Years
1994 COPS 2000 PRO 2000 Rev 2001 PRO 2005 PRO 2006 Rev
2001-02 $ 257,460 $ 239,250 $ 189,000 $ - $ - $ -
2002-03 $ - $ 239,250 $ 189,000 $ 224,790 $ - $ -
2003-04 $ - $ 239,250 $ 189,000 $ 219,165 $ - $ -
2004-05 $ - $ 239,250 $ 189,000 $ 206,660 $ - $ -
2005-06 $ - $ 239,250 $ 189,000 $ 192,260 $ 33,527 $ -
2006-07 $ - $ 239,250 $ 31,500 $ 175,510 $ 49,276 $ 76,494
2007-08 $ - $ 239,250 $ - $ 157,135 $ 46,826 $ 144,125
2008-09 $ - $ 239,250 $ - $ 143,195 $ 44,376 $ 142,325
2009-10 $ - $ 239,250 $ - $ 128,320 $ 41,839 $ 140,525
2010-11 $ - $ 111,393 $ - $ 61,219 $ 38,193 $ 140,258
Source: District Records
Note (1) – COPS –Certificates of Participation. PRO – Pledged Revenue Obligations. Rev – Revenue
Refunding Bonds.
Debt Service Principal Expense – Last 10 Fiscal Years
1994 COPS 2000 PRO 2000 Rev 2001 PRO 2005 PRO 2006 Rev
2001-02 $ 4,205,000 $ - $ - $ - $ - $ -
2002-03 $ - $ - $ - $ 150,000 $ - $ -
2003-04 $ - $ - $ - $ 305,000 $ - $ -
2004-05 $ - $ - $ - $ 320,000 $ - $ -
2005-06 $ - $ - $ - $ 335,000 $ - $ -
2006-07 $ - $ - $ 3,150,000 $ 350,000 $ 70,000 $ 55,000
2007-08 $ - $ - $ - $ 340,000 $ 70,000 $ 45,000
2008-09 $ - $ - $ - $ 350,000 $ 70,000 $ 45,000
2009-10 $ - $ 630,000 $ - $ 365,000 $ 75,000 $ 5,000
2010-11 $ - $ 3,720,000 $ - $ 2,115,000 $ 80,000 $ 5,000
Source: District Records
Note (1) – COPS –Certificates of Participation. PRO – Pledged Revenue Obligations. Rev – Revenue
Refunding Bonds.
[DEBT CAPACITY] Statistical Section
Mohave Community College 67 | P a g e Annual Report 2010-2011
Ratios of Out