Final Annual Financial Report 2013 · Annual Financial Report And Other Financial Information June 30, 2013 . ... as of June 30,2013, or the revenues, expenses and changes in fund

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NO. 228 [Midlothian, Illinois]

Annual Financial Report And

Other Financial Information

June 30, 2013

TABLE OF CONTENTS

Independent Auditors' Report........................................................................................................ 1

Basic Financial Statements:

Statement of Assets and Liabilities Arising from Cash Transactions -Regulatory Basis - All Funds............................................................................................... 3

Statement of Revenues Received, Expenditures Disbursed, Other Sources (Uses) and Changes in Fund Balances -Regulatory Basis All Funds.................................................. 4

Statement of Revenues Received- Regulatory Basis -All Funds.............................................. 5

Statement of Expenditures Disbursed- Regulatory Basis- Budget to Actual: Educational Fund................................................................................................................... 9 Operations and Maintenance Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 7 Debt Services Fund................................................................................................................ 18 Transportation Fund............................................................................................................... 19 Municipal Retirement/Social Security Fund.......................................................................... 20

Notes to Financial Statements ..................................................................................................... 22

Supplementary Financial Information:

Schedule of Changes in Cash Balances -Activity Funds .. . .. . .. .... ... ... ... .. . . . . .. .... .... ... .. .. .. .... .. .. .. ... 40

Other Financial Information:

Schedule of Assessed Valuations, Tax Rates and Tax Extensions.............................................. 41

Schedule ofNet Tax Collections and Uncollected Taxes............................................................ 42

Schedule of Debt Service Requirements for Bonded Debt.......................................................... 43

Schedule of Legal Debt Margin................................................................................................... 44

Schedule of Operating Expense Per Pupil and Per Capita Tuition Charge . .. .. .. .. .. ... .... .. .. .. .. ....... 45

Other Information:

Schedule of Funding Progress . .. . . . . . .. ... ... .. ... .. .. . . ......... .. .. . . . . .. . . ..... .. .. .. .. . . .. .. ... .. .. .. .. ... .. .. .. .. .. .. .. .. . .. 46

MATHIESON _____ MOYSKI·CELER ____ _ (630) 653-1616

Board of Education Bremen Community HS District #228 Midlothian, Illinois

Report on the Financial Statements

A. r" T T P ~ '---"v., J.....J.....J.. Certified Public Accountants

211 South Wheaton Avenue, Suite 300 Wheaton, IL 60187

Independent Auditor's Report

Fax(630)653-1735

We have audited the accompanying regulatory basis financial statements of Bremen Community HS District #228 (the District), as of and for the year ended June 30, 2013, and the related notes to the fmancial statements, which collectively comprise the District's basic financial statements as listed in the table of contents.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with the financial reporting provisions of the Illinois State Board of Education (ISBE) as described in Note 1 to meet the requirements of ISBE. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of fmancial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to fmancial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the fmancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fmancial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the fmancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the District's preparation and fair presentation of the financial statements in order to design 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. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Basis for Adverse Opinion on Accounting Principles Generally Accepted in the United States

As described in Note 1 to the financial statements, to meet the financial reporting requirements ofiSBE, the financial statements are prepared by the District on the basis of the financial reporting provisions of ISBE, which is a basis of accounting other than accounting principles generally accepted in the United States of America.

The effects on the financial statements for the variances between the regulatory basis of accounting described in Note 1 and accounting principles generally accepted in the United States of America, although not reasonably determined, are presumed to be material.

MEMBERS AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS

ILLINOIS CPA SOCIETY

Adverse Opinion on Accounting Principles Generally Accepted in the United States of America

In our opinion, because of the significance of the matter discussed in the Basis for Adverse Opinion on Accounting Principles Generally Accepted in the United States paragraph, the financial statements referred to above do not present fairly, in accordance with accounting principles generally accepted in the United States of America, the financial position of the District as of June 30,2013, or the revenues, expenses and changes in fund balance for the year then ended.

Opinion on Regulatory Basis of Accounting

The District does not maintain detailed records of the historical cost of its fixed assets; consequently, we are unable to express an opinion on the General Fixed Assets Account Group.

In our opinion, except for the effects of such adjustments, if any, as might have been required with respect to the General Fixed Assets Account Group, the financial statements referred to above present fairly, in all material respects, the regulatory basis fund balance of the District as of June 30, 2013, and the regulatory basis revenues, expenses, and changes in fund balance for the year then ended in accordance with the financial reporting provisions of ISBE described in Note 1.

Other Matters

Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the District's basic financial statements. The supplementary financial information, other financial information and other information is presented for purposes of additional analysis and is not a required part of the basic financial statements.

The supplementary financial information and other fmancial information are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic fmancial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic fmancial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary financial information and other financial information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

The other information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated November 19,2013 on our consideration of the District's internal control over fmancial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. 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 in considering the District's internal control over financial reporting and compliance.

Wheaton, Illinois November 19,2013

Educational

ASSETS Cash and investments $ 7,036,867 lnterfund receivables Land Building & building improvements Site improvements & inrrastmcture Capitalized equipment Amount available in debt services fund Amount to be provided for payment on

long-tenn debt

Total Assets $ 7,036,867

LIABILITIES AND FUND BALANCE Liabilities:

Interfund payables $ Due to activity fund organizations Long-tenn debt payable

Total Liabilities

Fund Balance: Reserved $ 856,577 Unreserved 6,180,290 Investment Ill general tixed assets

Total Fund Balance 7,036,867

Total Liabilities and Fund Balance $ 7,036,867

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228 STATEMENT OF ASSETS AND LIABILITIES ARISING FROM CASH TRANSACTIONS- REGULATORY BASIS

Operations & Maintenance

s 4,270,847

$ 4,270,847

$

$ 4,270,847

4,170,847

$ 4,270,847

ALL FUNDS FOR THE YEAR ENDED JUNE 30,2013 WITH COMPARATIVE TOTALS FOR 2012

Govemmental Funds

Municipal Fire Debt Retirement/ Working Tort Prevention Agency

Services T rans[>ortation Social Securi~ Cash Immunity & Safety Fund

$ 7,628,866 $ 2,524,451 $ 532,179 $ 8,617,779 $ 3,265 $ 15,570 $ 468,687 249,763

$ 7,628,866 $ 2,524,451 $ 532,179 $ 8,867,542 $ 3,265 $ 15,570 $ 468,687

$ $ $ s $ 249,763 $ $ 468,687

- $ - $ - $ - $ 249,763 $ - $ 468,687

$ $ $ $ $ $ $ 7,628,866 2,524,451 532,179 8,867,542 (246,498) 15,570

7,628,866 2,524,451 532,179 8,867,542 (246,498) 15,570

$ 7,628,866 $ 2,524,451 $ 532,179 $ 8,867,542 $ 3,265 s 15,570 $ 468,687

The notes to the financial statements are an integral part of this statement. 3

Account Groues

General Long-General Fixed tenn

Assets Debt

$ $

474,538 71,902,105

664,019 31,478,259

7,628,866

7,706,134

$ 104,518,921 $ 15,335,000

$ $

15,335,000

$ $ 15,335,000

$ $

I 04,51 g;121

104,518,921

$ 104,518,921 $ 15,335,000

Totals (Memorandwn Onl;t)

6/30/2013 2012

$ 3!,098,511 $ 36,912,981 249,763 249,763 474,538 474,538

71,902,105 70,495,991 664,019 664,019

31,478,259 30,930,512 7,628,866 7,443,902

7,706,134 16,746,098

$151,202,195 $163,917,804

$ 249,763 $ 249,763 468,687 479,944

15,335,000 24,190,000

$ 16,053,450 $ 24,919,707

$ 856,577 $ 150,534 29,773,247 36,282,503

J04,5Jg,nJ I 02,565,060

135,148,745 138,998,097

$151,202,195 $163,917,804

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228 STATEMENT OF REVENUES RECEIVED, EXPENDITURES DISBURSED, OTHER SOURCES (USES) AND CHANGES IN FUND BALANCES- REGULATORY BASIS


Municipal Fire Totals Operations & Debt Retirement/ Working Tort Prevention (Memorandum On!~)

Educational Maintenance Services Trans[lortation Social Security Cash Immunity & Safety 2013 2012

REVENUES RECEIVED: Local sources $ 40,!62,571 $ 4,151,026 $ 9,535,830 s 2,091,371 $ 1,848,104 $ 149,484 $ 28 $ 127 $ 57,938,541 $ 57,017,982 State sources 21,216,633 2,222,387 23,439,020 23,724,386 Federal sources 2,594,270 2,594,270 2,193,081

Total direct revenues received 63,973,474 4,151,026 9,535,830 4,313,758 1,848,104 149,484 28 127 83,971,831 82,935,449

Revenues received for "on behalf' payments 10,744,787 10,744,787 9,845,025

Total Revenues Received 74,718,261 4,151,026 9,535,830 4,313,758 I ,848, 104 149,484 28 127 94,716,618 92,780,474

EXPENDITURES DISBURSED: Instruction 41,652,533 849,140 42,501,673 43,396,542 Support services 22,617,958 3,212,049 2,333,129 1,562,318 29,725,454 29,660,120 Community services 42,978 2,274 45,252 54,976 Payments to other districts and govemmental units 5,906,366 1,801,733 7,708,099 6,209,780 Debt service 9,794,566 9,794,566 9,883,111

Total direct expenditures disbursed 70,219,835 3,212,049 9,794,566 4,134,862 2,413,732 89,775,044 89,204,529

Expenditures disbursed for "on behalf' payments 10,744,787 10,744,787 9,845,025

Total Expenditures Disbursed 80,964,622 3,212,049 9,794,566 4,134,862 2,413,732 100,519,831 99,049,554

Excess (deticiency) of revenues received over expenditures disbursed (6,246,361) 938,977 (258,736) 178,896 (565,628) 149,484 28 127 (5,803,213) _____@,_269,080)

OTHER FINANCING SOURCES: Abatement of the Working Cash Fund 8,000,000 8,000,000 8,000,000 Transfer from Educational Fund 1,000,000 Sale or compensation for fixed assets 1,100 Transfer to debt services fund to pay principal on capital leases 435,000 435,000 565,200 lranster to debt serv1ces tlmd to pay mterest on cap1tal leases 8,700 8,700 25,800

Total other financing sources 8,000,000 443,700 8,443,700 9,592,100

OTHER FINANCING USES: Abatement of the Working Cash Fund 8,000,000 8,000,000 8,000,000 Transfer to Operations and Maintenance Fund 1,000,000 Other revenues pledged to pay principal on capital leases 435,000 435,000 565,200 Other revenues pledged to pay mterest on cap1tal leases 8,700 8,700 25,800

Total other financing uses 443,700 8,000,000 8,443,700 9,591,000

Total other financing sources (uses) 7,556,300 443,700 (8,000,000) 1,100

Excess (Deficiency) of revenues received and other financing sources over expenditures disbursed and other financing uses 1,309,939 938,977 184,964 178,896 (565,628) (7,850,516) 28 127 (5,803,213) (6,267,980)

Fund balances (deficit) at beginning of year 5,726,928 3,331,870 7,443,902 2,345,555 1,097,807 16,718,058 (246,526) 15,443 36,433,037 42,701,017

FUND BALANCES (DEFICIT) AT END OF YEAR $ 7,036,867 $ 4,270,847 $ 7,628,866 $ 2,524,451 $ 532,179 $ 8,867,542 $ (246,498) $ 15,570 $ 30,629,824 $ 36,433,037


BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228 STATEMENT OF REVENUES RECEIVED- REGULATORY BASIS


Municipal Fire Totals Operations & Debt Retirement/ Working Tort Prevention (Memorandum On!~)

Educational Maintenance Services Transeortation Social Security Cash Immunity & Safety 2013 2012

REVENUES RECEIVED: Revenues received from local sources:

Ad valorem taxes levied: Designated purposes levies $ 38,040,709 $ 4,094,960 $ 9,493,650 $ 2,025,748 $ 892,305 $ $ $ $ 54,547,372 $ 53,719,031 FICA/medicare only purposes levy 892,305 892,305 ~228

Total ad valorem taxes levied 38,040,709 4,094,960 9,493,650 2,025,748 1,784,610 55,439,677 54,615,259

Payments in lieu of taxes: Corporate personal property replacement taxes 696,095 54,461 750,556 ______2Q2_, 13 7

Total payments in lieu of taxes 696,095 54,461 750,556 ______2Q2_, 13 7

Tuition: Summer sch- tuition from pupils or parents (in state) 116,801 116,801 134,074 Adult- tuition from pupils or parents (in state) 20,825 20,825 ___ 1_9,445

Total Tuition 137,626 137,626 ~519

Transportation fees: Regular -transp fees from pupils or parents (in state) 13,402 13,402 17,460 Regular- transp fees !rom other districts (in state) 31,833 31,833

Total transporation fees 45,235 45,235 17,460

Earnings on investments: Interest on investments 31,963 25,481 42,180 20,388 9,033 149,484 28 127 278,684 293,674

Total eanings on investments 31,963 25,481 42,180 20,388 9,033 149,484 28 127 278,684 ~674

District/school activity income: Admissions- athletic 65,045 65,045 71,667 Other district/school activity revenue 15,050 15,050 __ 1_8,345

Total district/school activity income 80,095 80,095 __ _2Q,012

Textbook income: Rentals- regular textbooks 933,648 933,648 442,887 Sales - regular textbooks 525 525 382,071 Other ________e,_226

Total textbook income $ 934,173 $ $ $ $ $ $ $ $ 934~ ~184

(Continued)


BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228 STATEMENT OF REVENUES RECEIVED- REGULA TORY BASIS

ALL FUNDS FOR THE YEAR ENDED JUNE 30,2013 WITH COMPARATIVE TOTALS FOR2012

Municipal Fire Totals Operations & Debt Retirement/ Working Tort Prevention (Memorandum Only)

Educational Maintenance Services TranSQOrtation Social Security Cash Immunity & Safety 2013 2012 REVENUES RECEIVED- Continued:

Revenues received from local sources- continued: Other revenue from local sources:

Rentals $ $ 30,585 $ $ $ $ $ $ $ 30,585 $ 32,990 Refund of prior years' expenditures 4,955 Drivers' education fees 107,595 I 07,595 116,504 Proceeds from vendors' contracts 131,147 131,147 106,811 Other local fees 12,189 Other local revenues 3,168 3,168 ___ 1_5,288

Total other revenue from local sources 241,910 30,585 272,495 ~737

Total revenues received from local sources 40,162,571 4,15\,026 9,535,830 2,091,37\ 1,848,104 149,484 28 127 57,938,541 57,0\7,982

Revenues received from state sources: Unrestricted grants-in-aid:

General state aid 17,789,975 17,789,975 ~346

Total unrestricted grants-in-aid 17,789,975 17,789,975 19,145,346

Restricted grants-in-aid Special education:

Private facility tuition 764,595 764,595 368,082 Extraordinary 982,209 982,209 814,627 Personnel 746,583 746,583 976,377 Orphanage - individual 379.272 379,272 227,012 Orphanage - summer 1,633 1,633 _______]}_y_ 797

Total special education 2,874,292 2,874,292 2,413,895

Career and technical education: Secondary program improvement 252,\71 252,171 253,193 Agriculture education 652 652 460

Total career and technical education 25?,823 252,823 253,653

Bilingual education: Downstate - TPI and TBE 29,871 29,87\ ~850

Total bilingual education 29,871 29,871 ~850

State free lunch and breakfast 6,319 6,319 9,063 Driver education $ 147,570 $ $ $ $ $ $ $ $ 147,570 $ 77,638

(Continued)




Municipal Fire Totals Operations & Debt Retirement! Working Tort Prevention (Memorandum Onlx)

Educational Maintenance Services Transrortation Social Securitx Cash Immunity & Safety 2013 2012

REVENUES RECEIVED- Continued: Revenues received from state sources- continued:

Transportation: Regular/vocational $ $ $ $ 509,634 $ $ $ $ $ 509,634 $ 451,609 Special education 1,712,7?} 1,712,753 1,313,421

Total transportation 2,222,387 2,222,387 1,765,030

Other restricted revenue from state sources 115,783 __ 1_1_5,783 3,911

Total restricted grants-in-aid 3,426,658 2,222,387 5,649,045 4,579,040

Total revenues received from state sources 21,216,633 2,222,387 23,439,020 23,724,386

Revenues received from federal sources: Food service:

Special milk program 16,536 16,536 16,520

Total food service 16,536 ___ 1_6,536 16,520

Title 1: Low income 847,347 847,347 423,939

Total Title l 847,347 847,347 423,939

Special education: IDEA- flow through/low incidence 862,841 862,841 1,083,913 IDEA- room & board 451 451 1,235

Total special education 863,292 863,292 1,085,148

Career and technical education- perkins: Perkins- title lliE- tech prep 216,541 216,541 88,335

Total career and technical education- perkins 216,541 216,541 88,335

Stimulus program: ARRA- IDEA- part b -flow-through 100,720 ARRA- Education jobs fund 26,111 26,1 I I

Total stimulus program $ 26,1 I I $ $ $ $ $ $ $ $ 26,111 $ 100,720

(Continued)

The notes to the financial statements are an integral part ofthis statement. 7

REVENUES RECEIVED- Continued: Revenues received from federal sources- continued:

Title Ill- English Language Acquisition McKinney Education for Homeless Children Title II- Teacher Quality Medicaid Matching Funds- Administrative Outreach Medicaid Matching Funds- Fee-for-Service Program Other Restricted Revenue from Federal Sources

I otal restncted grants-m-aid received trom the tederal gov't through the state

Total revenues received from federal sources

Total direct revenues received


ALL FUNDS FOR THE YEAR ENDED JUNE 30,2013 WITH COMPARATIVE TOTALS FOR2012

Municipal Operations & Debt Retirement/ Working

Educational Maintenance Services Transportation Social Security Cash

$ 24,414 $ $ $ $ $

55,154 153,407 183,867

_____lQ2, 60 I

2,594,270

2,594,270

$ 63,973,474 $ 4,151,026 $ 9,535,830 $ 4,313,758 s 1,848,104 $ 149,484


Fire Totals Tort Prevention (Memorandum On!~)

Immunity & Safety 2013 2012

$ $ $ 24,414 $ 753 18

55,154 144,338 153,407 131,460 183,867 196,981 207,601 4,869

2,594,270 2,193,081

2,594,270 2,193,081

$ 28 $ 127 $ 83,971,831 $ 82,935,449

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228 STATEMENT OF EXPENDITURES DISBURSED- REGULATORY BASIS

BUDGET TO ACTUAL EDUCATIONAL FUND

YEAR ENDED JUNE 30,2013 WITH COMPARATIVE ACTUAL TOTALS FOR2012

2013 2012

Budget Actual Actual

EXPENDITURES DISBURSED: Instruction:

Regular programs: Salaries $ 22,064,859 $ 22,603,137 $ 23,243,196 Employee benefits 4,096,357 3,994,292 4,391,812 Purchased services 95,780 76,107 241,529 Supplies and materials 777,937 780,037 485,945 Capital outlay 24,000 41,052 377,725

Total 27,058,933 27,494,625 28,740,207

Special education programs: Salaries 5,090,000 6,381,303 6,256,879 Employee benefits 493,750 497,484 481,819 Purchased services 28,000 23,101 20,712 Supplies and materials 135,000 178,415 130,661 Capital outlay 10,600 9,002 65,271

Total 5,757,350 7,089,305 6,955,342

Remedial and supplemental programs k-12: Salaries 167,850 234,031 555,570 Employee benefits 60,421 8,481 55,406 Purchased services 117,785 Supplies and materials 100,314 Capital outlay 56,012

Total 228,271 242,512 885,087

Adult/continuing education programs: Salaries 48,615 40,639 47,107 Employee benefits 404

Total 48,615 41,043 47,107

Career and technical education programs: Salaries 89,520 110,281 126,123 Employee benefits 17,251 24,940 21,166 Purchased services 20,750 21,141 12,650 Supplies and materials 279,532 295,072 327,580 Capital outlay 46,600 41,073 33,537

Total $ 453,653 $ 492,507 $ 521,056

The notes to the financial statements are an integral pati of this statement. (Continued)

9



YEAR ENDED JUNE 30,2013 WITH COMPARATIVE ACTUAL TOTALS FOR2012

2013 2012


EXPENDITURES DISBURSED -Continued: Instruction - Continued:

Interscholastic programs Salaries $ 2,891,350 $ 2,538,952 $ 2,223,892 Employee benefits 24,393 Purchased services 354,600 311,708 276,992 Supplies and materials 320,650 303,704 378,342 Capital outlay 23,150 21,555 21,022

Total 3,589,750 3,200,312 2,900,248

Summer school: Salaries 176,900 139,249 173,918 Employee benefits 1,734 Purchased services 4,000 8,171 24,268 Supplies and materials 6,100 1,900 3,963

Total 187,000 151,054 202,149

Gifted: Salaries 125 Purchased services 14,500 8,576 8,582 Supplies and materials 1,000 67 194

Total 15,500 8,643 8,901

Driver's education programs: Salaries 154,000 151,074 121,473 Employee benefits 1,747 Purchased services 38,000 25,984 Supplies and materials 4,000 316 Other 1,000

Total 197,000 179,121 121,473

Bilingual programs: Salaries 14,000 11,741 Purchased services 3,100 4,889 Supplies and materials 6,404 2,677

Total $ 23,504 $ 19,307 $

(Continued) The notes to the financial statements are an integral pmt of this statement.

10



YEAR ENDED JUNE 30,2013 WITH COMPARATIVE ACTUAL TOTALS FOR 2012

2013

Budget Actual

EXPENDITURES DISBURSED- Continued: Instruction - Continued:

Private tuition:

Special education programs k-12 $ 2,800,000 $ 2,734,104

Total 2,800,000 2,734,104

Total Instruction 40,359,576 41,652,533

Support Services: Pupils:

Attendance and social work : Purchased services 3,195

Total 3,195

Guidance services: Salaries 2,847,500 3,192,998 Employee benefits 613,750 574,670 Purchased services 6,195 Supplies and materials 11,500 5,142

Total 3,478,945 3,772,810

Health services: Salaries 306,500 304,165 Employee benefits 64,700 67,462 Purchased services 6,136 Supplies and materials 3,800 3,601

Total 375,000 381,364

Psychological services: Salaries 528,292 553,735 Employee benefits 93,136 100,420 Purchased services 2,750 1,527

Total $ 624,178 $ 655,682


2012

Actual

$ 2,204,251

2,204,251

42,585,821

3,112,100 600,014

324 7,256

3,719,694

301,264 56,536

5,257 3,718

366,775

458,296 74,610

1,892

$ 534,798

(Continued)



YEAR ENDED JUNE 30, 2013 WITH COMPARATIVE ACTUAL TOTALS FOR 2012

2013

Budget Actual

EXPENDITURES DISBURSED- Continued: Support Services - Continued:

Pupils - Continued: Other suppoti services- pupil:

Salaries $ 289,000 $ 309,180 Purchased services 4,000 3,017 Supplies and materials 20,700 23,651

Total 313,700 335,848

Total Pupils 4,791,823 5,148,899

Instructional staff: Improvement of instruction services:

Salaries 1,788,663 1,764,979 Employee benefits 196,100 191,664 Purchased services 480,099 347,953 Supplies and materials 60,300 63,534 Capital outlay 4,500 338 Non-capitalized equipment 68,400 124,762

Total 2,598,062 2,493,230

Educational media services: Salaries 1,194,700 1 '164,886 Employee benefits 234,300 225,386 Purchased services 2,000 336 Supplies and materials 30,600 28,792

Total I ,461,600 1,419,400

Assessment and testing: Salaries Purchased services 2,000 650 Supplies and materials 1,819

Total 2,000 2,469

Total Instructional Staff $ 4,061,662 $ 3,915,099

The notes to the financial statements are an integral pati of this statement. 12

2012

Actual

$ 289,371 4,287

21,239

314,897

4,936,164

1,613,979 171,546 350,844

40,133 1,821

2,178,323

1,174,601 204,860

4,820 35,918

1,420,199

29,590 12,899 6,659

49,148

$ 3,647,670

(Continued)




2013

Budget Actual


General Administration: Board of education services:

Salaries $ - $ 16,372 Employee benefits 723,000 606,148 Purchased services 813,000 625,849 Supplies and materials 15,000 17,879 Other 66,000 65,990

Total 1,617,000 1,332,238

Executive administration services: Salaries 567,000 584,363 Employee benefits 68,925 125,477 Purchased services 31,500 31,092 Supplies and materials 14,500 7,510 Capital outlay 3,000 3,670

Total 684,925 752,112

Tort immunity services: Employee benefits 458,000 280,434 Purchased services 290,000 310,640 Other 5,000

Total 753,000 591,074

Total General Administration 3,054,925 2,675,424

School administration: Office of the principal services:

Salaries 2,602,100 2,432,783 Employee benefits 386,900 267,132 Purchased services 91,200 62,499 Supplies and materials 107,800 87,134

Total $ 3,188,000 $ 2,849,548


2012

Actual

$ 721,557 605,622

16,586 66,367

1,410,132

585,991 60,412 24,212

9,741 2,644

683,000

(15,777) 453,429

325

437,977

2,531 '1 09

2,553,039 376,176

61,838 90,396

$ 3,081,449

(Continued)




2013

Budget Actual


School administration - Continued: Other support services- school administration:

Salaries $ l ,065,000 $ 1,193,781 Employee benefits 15,161

Total 1,065,000 1,208,942

Total School Administration 4,253,000 4,058,490

Business: Direction of business support services:

Salaries 145,000 146,561 Employee benefits 8,925 10,826

Total 153,925 157,387

Fiscal services: Salaries 370,000 309,661 Employee benefits 65,700 165,158 Purchased services 40,000 38,140 Supplies and materials 10,000 968

Total 485,700 513,927

Operation and maintenance of plant services: Salaries 3,850,400 3,906,703 Employee benefits 944,750 848,713 Purchased services 611,500 593,496

Total 5,406,650 5,348,912

Food services: Supplies and materials 1,250 8,429

Total $ 1,250 $ 8,429


2012

Actual

$ 1,078,566

1,078,566

4,160,015

146,561 10,358

156,919

371,612 57,505 12,000 8,236

449,353

3,911,634 914,718 587,224

5,413,576

$

(Continued)




2013 2012


EXPENDITURES DISBURSED - Continued: Support Services - Continued:

Business -Continued: Internal services:

Purchased services $ 159,000 $ 99,990 $ 147,276 Capital outlay 162,973

Total 159,000 262,963 147,276

Total Business 6,206,525 6,291,618 6,167,124

Central: Planning, research, development and evaluation services:

Purchased services 9 800

Total 9,800

Data processing services: Salaries 94,000 117,541 92,026 Employee benefits 8,400 25,590 4,808 Purchased services 58,500 28,664 36,546 Supplies and materials 11,000 4,250 2,104 Capital outlay 405,000 248,149 1,337

Total 576,900 424,194 136,821

Total Central 586,700 424,194 136,821

Other Support Services: Purchased services 176,065 104,234 5,380

Total Other Support Services 176,065 104,234 5,380

Total Support Services 23,130,700 22,617,958 21,584,283

Community Services: Salaries 38,003 31,800 54,390 Employee benefits 110 Purchased services 2,000 1,676 Supplies and materials 8,500 9,392

Total Community Services $ 48,503 $ 42,978 $ 54,390

The notes to the financial statements are an integral part of this statement. (Continued)

15




2013

Budget Actual

EXPENDITURES DISBURSED- Continued: Payments to other districts and governmental units (in-state):

Special education programs: Other programs - tuition: $ 5,500,000 $ 5,853,026

Total 5,500,000 5,853,026

Payments to other districts and governmental units (in-state): Other programs - tuition:

Other 30,000 53,340

Total 30,000 53,340

Total payments to other districts and governmental units 5,530,000 5,906,366

Total Expenditures Disbursed $ 69,068,779 $ 70,219,835


2012

Actual

$ 4,745,181

4,745,181

18,465

18,465

4,763,646

$ 68,988,140


BUDGET TO ACTUAL OPERATIONS AND MAINTENANCE FUND


2013

Budget Actual

EXPENDITURES DISBURSED: Support Services:

Business: Facilities acquisition and construction:

Purchased services $ - $ Capital outlay 2,000,000 1,406,114

Total 2,000,000 I ,406,114

Operation and maintenance of plant services: Purchased services 754,790 645,125 Supplies and materials I ,467,000 I, 140,875 Capital outlay 14,500 19,935

Total 2,236,290 I ,805,935

Total Business 4,236,290 3,212,049

Total Support Services 4,236,290 3,212,049



2012

Actual

$ 4,777 2,487,676

2,492,453

348,360 1,724,222

29,872

2,102,454

4,594,907

4,594,907

$ 4,594,907


BUDGET TO ACTUAL DEBT SERVICES FUND


2013

Budget Actual

EXPENDITURES DISBURSED: Debt Services:

Interest on long-term debt $ 939,516 $ 938,516 Payment of principal on long-term debt 8,855,000 8,855,000 Other 1,050

Total Debt Services 9,794,516 9,794,566



2012

Actual

$ 1,287,061 8,595,000

1,050

9,883, Ill

$ 9,883,111


BUDGET TO ACTUAL TRANSPORTATION FUND


2013

Budget Actual

EXPENDITURES DISBURSED: Support Services:

Business - Pupil transportation services: Salaries $ - $ Purchased services 2,367,200 2,333,129

Total 2,367,200 2,333,129

Total Support Services 2,367,200 2,333,129

Payments to other districts and governmental units: Payments to other districts and governmental units (in-state):

Special education programs: Purchased services 1,400,000 1,801,733

Total 1,400,000 1,801,733

Total payments to other distncts and governmental umts (m-state): 1,400,000 1,801,733

Total payments to other districts and governmental units 1,400,000 1,801,733


The notes to the financial statements are an integral pmi of this statement. 19

2012

Actual

$ 41,552 1,969,858

2,011,410

2,011,410

I ,446,134

1,446,134

1,446,134

1,446,134

$ 3,457,544


BUDGET TO ACTUAL MUNICIPAL RETIREMENT/SOCIAL SECURITY FUND


2013 2012


EXPENDITURES DISBURSED: Instruction -employee benefits:

Regular programs $ 348,000 $ 338,413 $ 361,291 Special education programs 307,000 393,795 357,524 Remedial and supplemental programs - k-12 3,400 10,657 14,611 Adult/continuing education programs 1,270 935 1,013 Career and technical education programs 3,302 2,289 2,589 Interscholastic programs 59,200 95,979 68,351 Summer school programs 8,090 2,755 3,145 Driver's education programs 543 2,129 2,197 Bilingual programs 2,188

Total Instruction 730,805 849,140 810,721

Support Services: Pupils -employee benefits:

Guidance services 162,000 178,684 167,912 Health services 11,961 15,869 15,759 Psychological services 6,550 7,935 6,646 Other 60,000 57,676 52,112

Total Pupils 240,511 260,164 242,429

Instructional Staff- employee benefits: Improvement of instruction services 41,711 68,108 44,024 Educational media services 133,600 126,716 127,635 Assessment & testing 3,783 4,617

Total Instructional Staff 179,094 194,824 176,276

General Administration -employee benefits: Board of education services 3,200 3,287 3,060 Executive administration services 102,000 50,144 102,222

Total General Administration 105,200 53,431 105,282

School Administration -employee benefits: Office of the principal services 185,000 199,723 182,821 Other 13,233 17,310 15,638

Total School Administration $ 198,233 $ 217,033 $ 198,459

(Continued) The notes to the financial statements are an integral part of this statement.

20


BUDGET TO ACTUAL MUNICIPAL RETIREMENT/SOCIAL SECURITY FUND


2013

Budget Actual

EXPENDITURES DISBURSED - Continued: Support Services - Continued:

Business- employee benefits: Direction of business suppmi services $ 2,100 $ 2,130 Fiscal services 63,800 107,269 Operation & maintenance of plant services 625,000 705,189 Pupil transportation services

Total Business 690,900 814,588

Central- employee benefits: Data processing services 16,700 22,278

Total Central 16,700 22,278

Total Suppmi Services I ,430,638 I ,562,318

Community Services 2,000 2,274



2012

Actual

$ 2,125 66,648

661,190 602

730,565

16,509

16,509

1,469,520

586

$ 2,280,827

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NO. 228 NOTES TO FINANCIAL STATEMENTS

June 30, 2013

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting policies of the District conform to the regulatory provisions prescribed by the Illinois State Board of Education, which is a comprehensive basis of accounting other than accounting principles accepted in the United States of America, as applicable to local governmental units of this type.

A. The Reporting Entity

The District includes all funds and account groups of its governmental operations that are controlled by or dependent upon the District as determined on a basis of financial accountability. Financial accountability includes appointment of the organization's governing body, imposition of will, and fiscal dependency. The accompanying financial statements include only those funds and account groups of the District as there are no other organizations for which it has financial accountability.

Joint Venture- The District is also a member of the following organizations:

- Southwest Cook County Cooperative Association for Special Education (See Note 1 0) - Career Development System (See Note 11)

B. Basis of Presentation - Fund Accounting

The accounts of the District are organized on the basis of funds and account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets and liabilities (arising from cash transactions), fund balance, revenues received and expenditures disbursed. The District maintains individual funds required by the State of Illinois. District resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The following funds and account groups are used by the District:

Governmental Funds

Governmental Funds are those through which most governmental functions of the District are financed. The acquisition, use and balances of the District's expendable financial resources and the related liabilities (arising from cash transactions) are accounted for through governmental funds.

The Educational Fund and the Operations and Maintenance Fund are the general operating funds of the District. They are used to account for all financial resources except those required to be accounted for in another fund.

22


June30,2013

The Debt Services Fund accounts for the accumulation of resources for, and the payment of general long-term debt principal, interest and related costs.

The Transportation Fund and the Illinois Municipal Retirement/Social Security Fund are used to account for cash received from specific sources (other than those accounted for in the Debt Services Fund, Capital Projects Fund, or Fiduciary Funds) that are legally restricted to cash disbursements for specified purposes.

The Working Cash Fund accounts for financial resources held by the District to be used for temporary interfund loans to other funds.

The Tort Immunity Fund accounts for financial resources held by the District to be used for tort immunity and tort judgment purposes.

The Fire Prevention and Safety Fund accounts for cash received from tax levies and bond proceeds for fire prevention, safety, energy conservation or school security purposes, and the expenditures related thereto.

Fiduciary Funds

Fiduciary Funds are used to account for assets held by the District in a trustee capacity or as an agent for individuals, private organizations, other governments or other funds.

The Agency Funds include Student Activity Funds and Convenience Accounts. They account for assets held by the District as an agent for the students, teachers, and other entities. These funds are custodial in nature and do not involve the measurement of the results of operations. The amounts due to the activity fund organizations are equal to the assets.

Measurement Focus

The financial statements of all Governmental Funds focus on the measurement of spending or "financial flow" and the determination of changes in financial position rather than upon net income determination. This means that only current assets and current liabilities are generally included on their statement of assets and liabilities arising from cash transactions. Their reported fund balance (net current assets) is considered a measure of "available spendable resources." Governmental Fund operating statements present increases (revenues received and other financing sources) and decreases (expenditures disbursed and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of "available spendable resources" during a period.

23


June 30, 2013

General Fixed Assets and Long-Term Debt Account Groups

The accounting and reporting treatment applied to the fixed assets associated with a fund are determined by its measurement focus. Fixed assets used in individual fund operations are accounted for in the General Fixed Assets Account Group, rather than in the individual funds.

Long-term liabilities expected to be financed from individual funds are accounted for in the General Long-Term Debt Account Group, not in the individual funds.

The account groups are not "funds". They are concerned only with the measurement of financial position. They are not involved with measurement of results of operations.

C. Basis of Accounting

Basis of accounting refers to when revenues received and expenditures disbursed are recog-nized in the accounts and how they are reported in the financial statements. The District maintains its accounting records for all funds and account groups on the cash basis of accounting under guidelines prescribed by the Illinois State Board of Education. Accordingly, revenues are recognized and recorded in the accounts when cash is received. In the same manner expenditures are recognized and recorded upon the disbursement of cash. Assets of a fund are only recorded when a right to receive cash exists which arises from a previous cash transaction. Liabilities of a fund, similarly, result from previous cash transactions.

Cash basis financial statements omit recognition of receivables and payables and other accrued and deferred items that do not arise from previous cash transactions.

Proceeds from sales of bonds are included as other financing sources in the appropriate fund on the date received. Related bond principal payable in the future is recorded at the same time in the General Long-Term Debt Account Group.

D. Budgets and Budgetary Accounting

Annual budgets for all Governmental Funds are prepared on the cash basis of accounting, which is the same basis that is used in financial reporting. This allows for comparability between budget and actual amounts. This is an acceptable method in accordance with Chapter 105, Section 5117.1 of the Illinois Compiled Statutes.

24


June30,2013

The District follows these procedures in establishing the budgetary data reflected in the financial statements:

1. The Administration submits to the Board of Education a proposed operating budget for the fiscal year commencing July 1. The operating budget includes proposed expenditures and the means of financing them.

2. Public hearings are conducted and the proposed budget is available for inspection to obtain taxpayer comments.

3. Prior to October 1, the budget is legally adopted through passage of a resolution. The budget, which was not amended, was adopted on September 18,2012.

4. Management is authorized to transfer budget amounts, provided funds are transferred between the same function and object codes. The Board of Education is authorized to transfer up to a legal level of 1 0% of the total budget between functions within any fund; however, any revisions that alter the total expenditures of any fund must be approved by the Board of Education following the public hearing process mandated by law.

5. Formal budgetary integration is employed as a management control device during the year for all governmental funds.

6. The District has adopted a legal budget for all its Governmental Funds. Total actual expenditures for the governmental funds may not legally exceed the total budgeted for such funds. However, under the State Budget Act expenditures may exceed the budget if additional resources are available to finance such expenditures.

7. The budget lapses at the end of each fiscal year. (All appropriations lapse at year end.)

E. Cash and Investments

The Bremen Township School Treasurer is the official custodian of money for the school districts and joint agreements within the township, including the District, as prescribed by Chapter 105, Section 5, Article 8 ofthe Illinois Compiled Statutes. The Township School Treasurer's Office, a legally separate entity under the oversight of the Bremen Township Trustees of Schools, pools the districts' money and invests, on the districts' behalf, in a cash and investment portfolio.

25


June 30, 20 I 3

The Township School Treasurer's Office has adopted a formal written investment and cash management policy. The policy provides that available funds be invested to the maximum extent possible at the highest possible rates obtainable at the time of investment in conformance with applicable State statutes and written administrative guidelines. Although current statutes do not require collateralization of deposits and investments in amounts which exceed insurance coverage, the investment policy of the Township School Treasurer's Office does provide for the Township School Treasurer to request collateralization in certain situations. The Township Trustees of Schools approve the financial institutions in which investments are made. Due to the nature of the pooled system, specific investment and related collateralization detail for each individual district is not available.

Deposits held in the District's name, consisting of imprest and activity fund accounts, are reported at cost. The District's equity in the Township School Treasurer's pool is reported based on cost or amortized cost of the underlying deposits and investments of the pool.

F. General Fixed Assets

General Fixed Assets have been acquired for general governmental purposes. At the time of purchase, assets are recorded as disbursements in the individual funds and capitalized at cost in the General Fixed Assets Account Group. Donated general fixed assets are stated at estimated fair market value as of the date of acquisition. The District has not maintained cumulative detailed property records for all fixed assets included in the General Fixed Assets Account Group. No depreciation has been provided on fixed assets.

G. Total Memorandum Only

The "Total Memorandum Only" column represents the aggregation (by addition) of the line-item amounts reported for each fund type and account group. No consolidations or other eliminations were made in arriving at the totals; thus, they do not present consolidated information.

These totals are presented only to facilitate financial analysis and are not intended to reflect the financial position or results of operations of the District as a whole.

26


June 30, 2013

NOTE 2. PROPERTY TAXES

Property taxes are levied each year on all taxable real property located in the District on or before the last Tuesday in December. The adoption date for the 2012 tax levy was December 18th, 2012. Taxes attach as an enforceable lien on property on January 1 and are due and payable in two installments. The first installment is due on March 1. The due date of the second installment varies and can occur in September, October, or November. The first installment is an estimated bill, and is 55% of the prior year's tax bill. The second installment is based on the current levy, assessment and equalization, and any changes from the prior year will be reflected in the second installment bill.

The following are the actual rates levied per $100 of assessed valuation:

Maximum Actual

2012 Levy 2012 Levy 2011 Levy

Educational 3.5000 3.0054 2.6582

Operations and Maintenance .5500 .3097 .2991

Bond and Interest - .7394 .6734

Transportation - .1833 .1196

Municipal Retirement - .0696 .0632

Social Security - .0696 .0632

Total 4.3770 3.8767

NOTE 3. CASH AND INVESTMENTS

The District is allowed to invest in securities as authorized by the Illinois Compiled Statutes, Chapter 30, Sections 235/2 and 235/6; and Chapter 105, Section 5/8-7. All deposits and investments of the District, except for imprest and activity accounts, are maintained in the external cash and investment pool managed by the Bremen Township School Treasurer's Office.

The Township School Treasurer's cash and investment pool is not a registered investment company, and is not rated by a nationally recognized statistical rating organization. However, the underlying securities which make up the Township School Treasurer's portfolio are rated. Information regarding the credit ratings of the pooled investments of the Township School Treasurer is available in the Township School Treasurer's financial statements. The weighted average maturity of the Township School Treasurer's cash and investment portfolio as of June 30, 2013 was 1.33 years.

27


June 30,2013

District 228's total cash and investments at June 30,2013 consisted ofthe following:

District 228's share of deposits and investments in the Township School Treasurer's cash and investments pool

Petty cash and imprest account (maintained by the District) Student activity accounts (maintained by the District) Funds on deposit to pay health insurance claims (maintained

by the District)

Total

$29,758,481 90,800

468,687

780,543

$31 ,098,511

Custodial credit risk is the risk that in the event of a bank failure, the District's deposits may not be returned to it. As of June 30,2013, $967,808 of the District's bank balances of$1,367,775 was exposed to custodial credit risk as follows:

U nco llateralized $ 967,808

NOTE 4. CHANGES IN LONG-TERM DEBT

The following is a summary of long-term debt transactions of the District for the year ended June 30, 2013:

Balance Balance Due within July 1, 2012 Additions Deletions June 30,2013 one year

Bonds Payable $23,755,000 $ - $8,420,000 $15,335,000 $8,835,000 Debt Certificates 435,000 - 435,000 - -Total Long-Term Debt $24,190,000 $ - $8,855,000 $15,335,000 $8,835,000

Long-term debt at June 30, 2013 is comprised of the following:

Limited tax working cash bonds issued for $2,200,000, dated January 1, 2004, provide for the retirement of principal on December 1, 2012 and 2013, and interest payable on June 1 and December 1 of each year. Interest rates on the outstanding bonds range from 3.6% to 4.0%.

Limited tax working cash bonds issued for $6,500,000, dated June 15, 2004, provide for the serial retirement of principal on December 1, 2014 through 2016, and interest payable on June 1 and December 1 of each year. Interest rates on the outstanding bonds range from 4.2% to 4.875%.

Limited tax working cash and refunding bonds issued for $31,480,000, dated March 10, 2010, provide for the serial retirement of principal on December 15, 20 l 0 through 2013, and interest payable on June 15 and December 15 of each year. The interest rates on the outstanding bonds range from 3.0% to 5.0%.

28


June 30, 2013

The annual requirements to amortize all debt outstanding as of June 30, 2013 are as follows:

Year Ending

June 30, 2014 2015 2016 2017

Bonds Payable Principal $8,835,000

2,065,000 2,165,000 2,270,000

Interest $509,921

248,512 146,759 47 670

$ 15.335±000 $952.862

NOTE 5. RISK MANAGEMENT

Total 9,344,921 2,313,512 2,311,759 2,317,670

$ 16.~87.862

The District has purchased insurance from private insurance companies. Risks covered include general liability, property damage and other. The District also operates a self insurance program for medical and dental coverage for employees (See Note 14) and workers compensation (See Note 15).

No material decreases in insurance coverages have occurred nor have any insurance claims in excess of insurance coverages been paid or reported during the last three fiscal years.

NOTE 6. RETIREMENT FUND COMMITMENTS

Illinois Teachers' Retirement System:

The District pmiicipates in the Teachers' Retirement System of the State oflllinois (TRS). TRS is a cost-sharing multiple-employer defined benefit pension plan that was created by the Illinois legislature for the benefit of Illinois public school teachers employed outside the city of Chicago.

The Illinois Pension Code outlines the benefit provisions ofTRS, and amendments to the plan can be made only by legislative action with the Governor's approval. The State of Illinois maintains the primary responsibility for funding the plan, but contributions from participating employers and members are also required. The TRS Board of Trustees is responsible for the system's administration.

TRS members include all active nonannuitants who arc employed by a TRS-covered employer to provide services for which teacher certification is required. The active member contribution rate for the year ended June 30, 2013 was 9.4% of creditable earnings. The same contribution rate applies to members whose first contributing service is on or after January 1, 2011, the effective date ofthe benefit changes contained in Public Act 96-0889. These contributions, which may be paid on behalf of employees by the employer, are submitted to TRS by the employer. The active member contribution rate was also 9.4% for the years ended June 30, 2012 and 2011.

The State of Illinois makes contributions directly to TRS on behalf of the District's TRS-covered employees.

29


June30,20I3

On-behalf contributions to TRS. The State of Illinois makes employer pension contributions on behalf of the District. For the year ended June 30, 2013, State of Illinois contributions were based on 28.05% of creditable earnings not paid from federal funds, and the District recognized revenue and expenditures of $10,398,839 in pension contributions that the State of Illinois paid directly to TRS. For the years ended June 30, 2012 and June 30, 2011, the State of Illinois contribution rates as percentages of creditable earnings not paid from federal funds were 24.91% ($9,506,487) and 23.10% ($8,495,945), respectively.

The District makes other types of employer contributions directly to TRS:

2.2 formula contributions. Employers contribute 0.58% of total creditable earnings for the 2.2 formula change. This rate is specified by statute. Contributions for the year ended June 30,2013 were $218,098. Contributions for the years ending June 30, 2012 and June 30, 2011 were $223,127 and $215,258, respectively.

Federal and special trust fund contributions. When TRS members are paid from federal and special trust funds administered by the District, there is a statutory requirement for the District to pay an employer pension contribution from those funds. Under a policy adopted by the TRS Board of Trustees that was first effective for the fiscal year ended June 30, 2006, employer contributions for employees paid from federal and special trust funds will be the same as the state contribution rate to TRS.

For the year ended June 30, 2013, the employer pension contribution was 28.05% of salaries paid from federal and special trust funds. For the years ended June 30,2012 and 2011, the employer contribution was 24.91% and 23.10% of salaries paid from federal and special trust funds, respectively. For the year ended June 30, 2013, salaries totaling $530,563 were paid from federal and special trust funds that required employer contributions of $148,823. For the years ended June 30, 2012 and June 30, 2011, required District contributions were $76,451 and $77,286, respectively.

Early Retirement Option (ERO). The District is also required to make one-time employer contributions to TRS for members retiring under the Early Retirement Option (ERO). The payments vary depending on the age and salary of the member.

The maximum employer ERO contribution under the current program is 117.5% and applies when the member is age 55 at retirement.

For the year ended June 30, 2013, the District paid $313,854 to TRS for employer contributions under the ERO program. For the years ended June 30, 2012 and June 30, 2011, the District paid $417,106 and $44,054 in employer ERO contributions, respectively.

30


June 30, 2013

Salary increases over 6% and excess sick leave. If an employer grants salary increases over 6% and those salaries are used to calculate a retiree's final average salary, the employer makes a contribution to TRS. The contribution will cover the difference in actuarial cost of the benefit based on actual salary increases and the benefit based on salary increases of up to 6%.

For the year ended June 30,2013, the District had no liability to TRS for employer contributions due on salary increases in excess of 6%. For the years ended June 30, 2012 and June 30, 2011, the District paid $40 and $15,127 to TRS for employer contributions due on salary increases in excess of 6%, respectively.

If an employer grants sick leave days in excess of the normal annual allotment and those days are used as TRS service credit, the employer makes a contribution to TRS. The contribution is based on the number of excess sick leave days used as service credit, the highest salary rate reported by the granting employer during the four-year sick leave review period, and the TRS total normal cost rate (17.63% of salary during the year ended June 30, 2013).

For the years ended June 30, 2013, June 30, 2012, and June 30, 2011, the District did not grant sick leave days in excess of the normal annual allotment.

Further information on TRS. TRS financial information, an explanation of TRS benefits, and descriptions of member, employer and state funding requirements can be found in the TRS Comprehensive Annual Financial Report for the year ended June 30, 2012. The report for the year ended June 30,2013, is expected to be available in late 2013.

The reports may be obtained by writing to the Teachers' Retirement System of the State of Illinois, 2815 West Washington Street, P.O. Box 19253, Springfield, IL 62794-9253. The most current report is also available on the TRS website at http://trs.illinois.gov.

Illinois Municipal Retirement Fund:

Plan Description. The District's defined benefit pension plan for Regular employees provides retirement and disability benefits, post retirement increases, and death benefits to plan members and beneficiaries. The plan is affiliated with the Illinois Municipal Retirement Fund (IMRF), an agent multiple-employer plan. Benefit provisions are established by statute and may only be changed by the General Assembly of the State of Illinois. IMRF issues a publicly available financial report that includes financial statements and required supplementary information. That repmi may be obtained on-line at www.imrf.org.

31


June 30, 2013

Funding Policy. As set by statute, the District's Regular plan members are required to contribute 4.50% of their annual covered salary. The statute requires the District to contribute the amount necessary, in addition to member contributions, to finance the retirement coverage of its own employees. The employer contribution rate for calendar year 20 12 used by the employer was 10.78% of annual covered payroll. The employer annual required contribution rate for calendar year 2012 was 11.30%. The District also contributes for disability benefits, death benefits and supplemental retirement benefits, all of which are pooled at the IMRF level. Contribution rates for disability and death benefits are set by the IMRF Board of Trustees, while the supplemental retirement benefits rate is set by statute.

Annual Pension Cost. For calendar year ending December 31,2012, the employer's actual contributions for pension cost were $984,589. Its required contribution for calendar year 2012 was $1,032,083.

Three-Year Trend Information for the Regular Plan

Annual Pension Percentage of APC Net Pension Fiscal Year Ending Cost (APC) Contributed Obligation

12/31112 $1,032,083 95% $327,660 12/31/11 974,718 88 280,166 12/31/10 929,226 83 161,383

The required contribution for 2012 was determined as part of the December 31, 2010, actuarial valuation using the entry age normal actuarial cost method. The actuarial assumptions at December 31,2010, included (a) 7.5% investment rate ofreturn (net of administrative and direct investment expenses), (b) projected salary increases of 4.00% a year, attributable to inflation, (c) additional projected salary increases ranging from 0.4% to 10% per year depending on age and service, attributable to seniority/merit, and (d) post retirement benefit increases of 3% annually. The actuarial value of the District's Regular plan assets was determined using techniques that spread the effects of short-term volatility in the market value of investments over a five-year period with a 20% corridor between the actuarial and market value of assets. The District's Regular plan's unfunded actuarial accrued liability at December 31, 2010 is being amortized as a level percentage of projected payroll on an open 30 year basis.

Funded Status and Funding Progress. As of December 31, 2012, the most recent actuarial valuation date, the Regular plan was 76.48% funded. The actuarial accrued liability for benefits was $21,970,488 and the actuarial value of assets was $16,803,657, resulting in an underfunded actuarial accrued liability (UAAL) of$5,166,831. The covered payroll for calendar year 2012 (annual payroll of active employees covered by the plan) was $9,133,480 and the ratio ofthe UAAL to the covered payroll was 57%.

32


June 30, 2013

The schedule of funding progress, presented as other supplementary information to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits.

NOTE7. OTHERPOSTEMPLOYMENTBENEnTS

Teacher Health Insurance Security:

The District participates in the Teacher Health Insurance Security (THIS) Fund, a cost-sharing, multiple-employer defined benefit post-employment healthcare plan that was established by the Illinois legislature for the benefit of retired Illinois public school teachers employed outside the city of Chicago. The THIS Fund provides medical, prescription, and behavioral health benefits, but it does not provide vision, dental, or life insurance benefits to annuitants of the Teachers' Retirement System (TRS). Annuitants may participate in the state administered participating provider option plan or choose from several managed care options.

The State Employees Group Insurance Act of 1971 (5 ILCS 375) outlines the benefit provisions of THIS Fund and amendments to the plan can be made only by legislative action with the Governor's approval. Effective July 1, 2012, in accordance with Executive Order 12-01, the plan is administered by the Illinois Department of Central Management Services (CMS) with the cooperation ofTRS. Section 6.6 ofthe State Employees Group Insurance Act of 1971 requires all active contributors to TRS who are not employees of the state to make a contribution to THIS Fund.

The percentage of employer required contributions in the future will not exceed 105% of the percentage of salary actually required to be paid in the previous fiscal year.

On behalf contributions to THIS Fund. The State of Illinois makes employer retiree health insurance contributions on behalf of the District. State contributions are intended to match contributions to THIS Fund from active members which were 0.92% of pay during the year ended June 30,2013. State of Illinois contributions were $345,948, and the District recognized revenue and expenditures of this amount during the year.

State contributions intended to match active member contributions during the years ended June 30,2012 and June 30,2011 were 0.88% of pay, both years. State contributions on behalf of District employees were $338,538 and $326,599, respectively.

Employer contributions to THIS Fund. The District also makes contributions to TI-llS Fund. The District THIS Fund contribution was 0.69% during the year ended June 30,2013 and 0.66% during the years ended June 30, 2012 and June 30, 2011. For the year ended June 30, 2013, the District paid $259,461 to the THIS Fund. For the years ended June 30, 2012 and June 30, 2011, the District paid $253,904 and $244,949 to the THIS Fund, respectively, which was 1 00% of the required contribution.

33


June 30, 20 I 3

Further information on THIS Fund. The publicly available financial report of the THIS Fund may be found on the website of the Illinois Auditor General: http://www.auditor.illinois.gov/Audit-Reports/ABC-List.asp. The 2013 report is listed under "Central Management Services." Prior reports are available under "Healthcare and Family Services."

Defined Postemployment Benefit Plan:

Plan Description: The District's Other Postemployment Benefits (OPEB) Plan is a single-employer defined benefit healthcare plan that is administered by the District. The District provides medical insurance benefits to eligible retirees and their covered eligible dependents. All active employees who retired directly from the District and meet the eligibility criteria may participate.

Funding Policy: There are no contribution requirements established by the District. The District cunently pays for postemployment health care benefits on a pay-as-you-go basis.

Annual OPEB Cost and Net OPEB Obligation: The District's annual other postemployment benefit (OPEB) cost (expense) is calculated based on the annual required contribution ofthe employer (ARC), an amount actuarially determined in accordance with the parameters ofGASB 45. The following shows the components of the District's annual OPEB cost for the year, the amount actually contributed to the plan, and changes in the District's Net OPEB obligation:

Annual required contribution Interest on net OPEB obligation Adjustment to annual required contribution Annual OPEB cost Contributions made Decrease in net OPEB obligation Net OPEB obligation (asset)-July 1, 2012 Net OPEB obligation (asset)-June 30, 2013

$ 89,607 (1 0,974)

9 136 87,769

1 11 201 (23,432)

(274,358) $ (297,790)

Trend Information: The District's annual OPEB cost, the percentage of the annual OPEB cost contribution to the plan, and the net OPEB obligation is as follows:

Trend Information for the Plan

Net Pension Fiscal Year Annual OPEB Percentage of Obligation

Ending Cost APC Contributed (Asset) 6/30113 $87,769 126.7% $(297,790) 6/30112 41,479 268.1 (274,358) 6/30/11 40,609 273.8 (204,636)

34


June 30, 2013

Funding Status and Funding Progress: The funded status of the plan as of July 1, 2009, the most recent actuarial valuation date, is as follows:

Actuarial accrued liability (AAL) $ 1,001,981 Actuarial value of plan assets

Unfunded actuarial accrued liability (UAAL) $ 1,001,981

Funded ratio (actuarial value of plan assets I AAL) 0%

The schedule of funding progress presented as other financial information, presents multiyear trend information that shows whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits.

Actuarial Methods and Assumptions: Actuarial valuations for an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Actuarially determined amounts are subject to continuous revision as actual results are compared to past expectations and new estimates about the future are formulated. Although the valuation results are based on values which the District's actuarial consultant believes are reasonable assumptions, the valuation results reflect a long-term perspective and, as such, are merely an estimate of what future costs may actually be. Deviations in any of several factors, such as future interest rates, medical cost inflation, Medicare coverage, and changes in marital status, could result in actual costs being less or greater than estimated.

Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations.

In the actuarial valuation for the plan as of June 30, 2013 the entry age cost method was used. The actuarial assumptions included a 4% annual discount rate and an annual healthcare cost trend rate of 8% initially, reduced to an ultimate rate of 6%. Both rates included a 3% inflation assumption. The UAAL will be amortized as a level percentage of projected payroll on a closed group valuation basis. The remaining amortization period is 30 years.

35


June 30, 20 !3

NOTE 8. FUND BALANCE REPORTING

The District's fund balances for Governmental Funds are classified as follows:

Nonspendable- The nonspendable fund balance classification includes amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact. The "not in spendable form" criterion includes items that are not expected to be converted to cash, for example inventories and prepaid amounts. Due to the cash basis nature of the district all such items are expensed at the time of purchase, so there is nothing to report for this classification.

Restricted Fund Balance - The restricted fund balance classification refers to amounts that are subject to outside restrictions, not controlled by the District. Things such as restrictions imposed by creditors, grantors, contributors, or laws and regulations of other governments, or imposed by law through constitutional provisions or enabling legislation. Special Revenue Funds are by definition restricted for those specified purposes.

Committed The committed fund balance classification refers to amounts that can only be used for specific purposes as determined by a formal action of the District's highest level of decision making authority (the School Board). Commitments may be established, modified, or rescinded only through resolutions approved by the School Board. C01m11itted fund balance also incorporates contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.

Assigned - The assigned fund balance classification refers to amounts that are constrained by the District's intent to be used for a specific purpose, but are neither restricted nor committed. Intent may be expressed by the School Board itself or the School Board may delegate the authority to assign amounts. Currently the School Board has not delegated the authority.

Unassigned- The unassigned fund balance classification is the residual classification for amounts in the General Operating Funds that have not been restricted, committed, or assigned to specific purposes and any deficit fund balances in other funds. Unassigned Fund Balance amounts are shown in the financial statements as Unreserved Fund Balances in the Educational, Operations and Maintenance, and Working Cash Accounts.

36


June 30, 2013

Reconciliation of Fund Balance Reporting

Financial Statements-

Fund Restricted Unassigned Reserved Educational $ 856,577 $6,180,290 $ 856,577 Operations & Maintenance - 4,270,847 -Debt Services 7,628,866 - -Transportation 2,524,451 - -Municipal Retirement 532,179 - -Working Cash - 8,867,542 -Tort Liability - (246,498) -Fire Prevention and Safety 15,570 - -

Financial Statements-Unreserved $ 6,180,290

4,270,847 7,628,866 2,524,451

532,179 8,867,542 (246,498)

15,570

When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, the District considers restricted funds to have been spent first. When an expenditure is incurred for which committed, assigned, or unassigned fund balances are available, the District considers amounts to have been spent first out of committed funds, then assigned funds, and finally unassigned funds, as needed, unless the Board or the finance committee has provided otherwise in its commitment or assignment actions.

NOTE 9. INTERFUND TRANSFERS

At June 30,2013, interfund transfers consisted of the following:

Transfer from Transfer to Amount Working Cash Educational $8,000,000 Educational Debt Service 443,700

Transfers are used to (1) move revenues from the fund that statute or budget requires to collect them to the fund that statute or budget requires to expend them, and (2) use unrestricted revenues collected to finance various programs accounted for in other funds in accordance with budgetary authorizations.

The transfer from the Working Cash Fund to the Educational Fund was to support deficit spending in the Educational Fund.

The Illinois State Board of Education Administrative Code requires that all debt service payments be reported in the Debt Services Fund. However, certain debt service payments are funded by sources other than a debt service levy. Accordingly, interfund transfers are required to transfer the proceeds ofthese other funding sources from the fund in which they are required to be deposited, to the Debt Services Fund from which the debt service payments will be made.

37


June 30,2013

NOTE 10. JOINT VENTURE- SOUTHWEST COOK COUNTY COOPERATIVE ASSOCIATION FOR SPECIAL EDUCATION (SWCCCASE)

The District is a member of Southwest Cook County Cooperative Association for Special Education and Career Development System, along with other area school districts. The District's pupils benefit from special education programs and services administered under the joint agreements, and the District benefits from jointly administered grants and programming. The District does not have an equity interest in the joint agreement. The joint agreement is separately audited and is not included in these financial statements. Financial information may be obtained directly from Southwest Cook County Cooperative Association for Special Education at 6020 W. 151 st Street, Oak Forest, Illinois 60452 and Career Development System at 16333 S. Kilbourn A venue, Oak Forest, Illinois 60452.

NOTE 11. JOINT VENTURE- CAREER DEVELOPMENT SYSTEM (CDS)

The District along with three other Districts and educational organizations have entered into a Joint Agreement to provide access and efficiency in the delivery of quality education for employment programs.

Complete financial statements for CDS can be obtained from the Administrative Offices at 16333 S. Kilbourn Avenue, Oak Forest, Illinois 60452.

NOTE 12. EXCESS OF EXPENDITURES DISBURSED OVER BUDGET IN INDIVIDUAL FUNDS

Expenditures disbursed exceeded the budgeted amount in the following individual fund:

Fund Budget Actual Excess

Educational $ 69,068,779 $ 70,219,835 $ 1,151,056

Debt Service 9,794,516 9,794,566 50

Transportation 3,767,200 4,134,862 367,662

Illinois Municipal Retirement/Social Security 2,163,443 2,413,732 250,289

38


June 30, 2013

NOTE 13. INTERFUND LOANS

At June 30, 2013, interfund loans consisted of the following:

Due to Due from Balance

Working Cash Fund Tort Immunity Fund $ 249,763

Interfund loans are used to finance activities of a fund which has overexpended its available resources. Interfund loans are generally short-term in nature.

NOTE 14. SELF INSURANCE -MEDICAL AND DENTAL

The District maintains a partial self insurance plan to provide medical and dental insurance to its employees. The plan is funded by the District and expenditures are incurred when claims are paid. Stop-loss insurance has been obtained to limit the District's liability for individual and aggregate claims. The stop-loss coverage limits for the year ended June, 30, 2013 were $100,000 for individual claims and $5,131,326 for aggregate claims. At June 30, 2013 and 2012, the cumulative excess of funds reserved for the District's self insurance plan exceed claims by $780,533 and $150,534, respectively, in the Educational Fund. This amount is reported as a reserved fund balance.

NOTE 15. SELF INSURANCE -WORKERS COMPENSATION

The District is self insured for workers compensation costs. The plan is funded by the District and expenditures are incurred when claims are paid. Excess insurance coverage has been obtained to limit the District's liability per occurrence. The self insured retention limit for the year ended June 30, 2013 was $400,000.

NOTE 16. RESERVED FUND BALANCE

Per the Illinois School Code, all funds received for driver education must be used solely for funding the school's driver education program. Revenues from driver education fees and grants and related expenditures disbursed have been included in the operations of the Educational Fund. At June 30, 2013, the cumulative driver education fees and grants received exceeded related cumulative expenditures in the Educational Account. Accordingly, the Educational Fund is reserved $76,044 related to this activity.

39

SUPPLEMENTARY FINANCIAL INFORMATION

Bremen High School

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228 SCHEDULE OF CHANGES IN CASH BALANCES

ACTIVITY FUNDS FOR THE YEAR ENDED JUNE 30,2013

Balance July I, 2012 Collections Disbursements

$ 91,860 $ 230,153 $ 228,753 Tinley Park High School 160,068 406,384 420,450 Oak Forest High School 144,540 320,208 323,594 Hillcrest High School 83,476 221,088 216,293

Total Activity Funds $ 479,944 $ 1' 177,833 $ 1 '189,090

40

Balance June 30,2013

$ 93,260 146,002 141,154 88,271

$ 468,687

OTHER FINANCIAL INFORMATION

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228 SCHEDULE OF ASSESSED VALUATIONS, TAX RATES, AND

TAX EXTENSIONS YEARS ENDED JUNE 30, 2013, 2012, 20 I I, 20 I 0, AND 2009

TAX LEVY YEAR

2012 2011 2010 2009

ASSESSED VALUATION $1,356,997,366 $1 ,490,3 86,692 $1 '780,442,834 $1,761' 164,354

TAX RATES BY LEVY: Educational 3.0054 2.6582 2.2202 2.2120 Tort Immunity Operations and

maintenance 0.3097 0.2991 0.2219 0.1865 Transportation 0.1833 0.1196 0.0888 0.0878 Illimois municipal

retirement 0.0696 0.0632 0.0527 0.0526 Social Security 0.0696 0.0632 0.0527 0.0526 Debt Services (Bonds) 0.7394 0.6734 0.5637 0.5655 Working Cash

TOTAL 4.3770 3.8767 3.2000 3.1570

TAX EXTENSIONS BY LEVY: Educational $ 40,783,198 $ 39,617,458 $ 39,529,392 $ 38,956,956 Tort immunity Operations and

maintenance 4,202,620 4,457,746 3,950,803 3,284,572 Transportation 2,487,376 1,782,502 1,581,033 I ,546,302 Illimois municipal

retirement 944,470 941,924 938,293 926,372 Social security 944,470 941,924 938,293 926,372 Debt services (Bonds) 10,033,796 10,036,266 I 0,036,357 9,959,384 Working cash

TOTAL $ 59,395,930 $ 57,777,820 $ 56,974,171 $ 55,599,958

41

2008

$1,725,288,886

2.2164 0.0163

0.1970 0.0919

0.0567 0.0567 0.5815 0.0001

3.2166

$ 38,239,303 281,222

3,398,819 I ,585,540

978,239 978,239

10,032,556 1,725

$ 55,495,643

Tax Levy Year

2008 2009 2010 2011 2012

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228

SCHEDULE OF NET TAX COLLECTIONS AND UNCOLLECTED TAXES

FOR THE YEAR ENDED JUNE 30,2013

Tax Extension

$ 55,495,643 $ 55,599,958 56,974,171 57,777,820 59,395,930

By Fund:

Educational Operations and Maintenance Transportation Illinois Municipal Retirement Social Security Debt Services

Prior

52,676,822 52,586,760 54,277,330 28,309,249

42

Tax Collections

$

$

Year Ended June 2013

(60,337) 26,916,407 28,583,607

55,439,677

38,040,709 4,094,960 2,025,748

892,305 892,305

9,493,650

$ 55,439,677

Total

$ 52,676,822 52,586,760 54,216,993 55,225,656 28,583,607

Percent Collected

94.92% 94.58% 95.16% 95.58% 48.12%

BREMEN COMMUNITY HIGH SCHOOL DISTRICT NUMBER 228

SCHEDULE OF DEBT SERVICE REQUIREMENTS FOR BONDED DEBT

JUNE 30,2013

Working Cash Bonds

Dated

Documents

Final Annual Financial Report 2013 · Annual Financial Report And Other Financial Information June 30, 2013 . ... as of June 30,2013, or the revenues, expenses and changes in fund