Northern Essex Community College
Board of Trustees Audit and Finance Sub-Committee Minutes
Wednesday, December 6, 2023
Attendees: Trustees Jennifer Borislow, Jouel Gomez via Zoom, Sally O’Rorke via Zoom, Lloyd Hamm, and Evan Silverio, President Lane Glenn, Michael McCarthy, Anthony DeGregorio, and Linda Buckley, Note-taker
Guest: Benjamin DeForest of Withum
Chairman Hamm called the meeting to order at 4:29 pm. The minutes of the October 4, 2023 meeting were approved with a motion presented by Trustee Silverio and seconded by Trustee Hamm.
Updates:
FY2023 Audited Financial Statements (AFC-24-02): The Audit & Finance Sub-Committee accepted the FY2023 audited financial statements and related material and recommended presenting it to the Board of Trustees of Northern Essex Community College for acceptance.
Benjamin DeForest of Withum has conducted the annual audit in accordance with the auditing standards applicable to financial audits contained in Government Auditing Standards and have provided the financial statements and management’s Discussion and Analysis. The auditor commended the work and contributions of Michael McCarthy, CFO/COO, Anthony DeGregorio, and their team.
On a Motion presented by Trustee O’Rorke and seconded by Trustee Gomez, the Board unanimously accepted the NECC FY2023 Audited Financial Statements (AFC-24-02) as presented.
In the Approved FY2024 Supplemental Budget, QT 1, the Key Assumptions noted by Vice President Michael McCarthy were as follows:
· YE Actual Tuition & Fees Revenue represents an increase of $688k or 3.77% over the FY23 4th QT. projection. Based on YE actual reported completed credits of 51,976 which is an increase of 580 from 4th QT.
· YE Actual Student Financial Aid (SFA) increased by $283k or 4.04%; resulting in an annual discount rate of 37.45% versus a budget of 36%.
· YE Actual Grants & Other Revenues totaled $20.3 million; net results on budget.
· YE Actual Salaries & Benefits were under projections by $4.1 million, projections had included union retro and raises that will incur in FY24; along with lower than expected actual OPED and Workers Comp calculations.
· YE Actual Other Operating Expenses is $18.5 million, an increase of $703k from projection. The major driver of the increase was higher utilities expenses.
· YE Actual Depreciation Expense was increased to $4.6 million to recognize the new FY23 capital assets and 4th QT. purchases.
· YE Actual Bad Debt Expense $390k represents an increase of $54k from projections.
· YE Actual Federal CARES/HEERF Net Revenue and Recognized Loss Revenue & Indirect Expenses were as forecasted, a net $6.0 million.
· YE Actual FY23 State Support decreased to $31 million; some state FY23 funding will become state grants reimbursement during FY24, and retro union salaries reimbursement will be in FY24 versus FY23.
· YE Actual Net Investment Income is ~$1.2 million, close to the projection for the year of ~$1.1m.
· YE Actual FY23 Capital Appreciation of $606k represents our actual planned spend of our awarded Capital Appropriation for critical project repairs from the state that were expended during FY23.
Results in a Actual FY2023 yearend positive increase of $7.3 million change in Net Position.
Our QT. 4 YE Projection, prior to a reserve for audit adjustments, was $7.2 million.
With no further business, the meeting was adjourned at 4:45 pm.
Respectfully Submitted by Linda Buckley. December 15, 2023
