North East Independent School District San Antonio, Texas ... · San Antonio, Texas Comprehensive Annual Financial Report Year Ended June 30, 2015 Report Issued by the Department

North East Independent School District

San Antonio, Texas

Comprehensive Annual Financial Report

Year Ended June 30, 2015

Report Issued by the Department of

Finance and Accounting

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North East Independent School District Comprehensive Annual Financial Report

Finance and Accounting Team:

Dan Villarreal, CPA, RTSBA, Associate Superintendent for Business Services/ Chief Financial Officer

Brian Moy, Executive Director of Finance and Accounting

Mary Alex, CPA, Senior Director of Grants Administration and Financial Control

Jeff Coats, Senior Director of Accounting

Susie Lackorn, Director of Budgets and Financial Analysis

Dee Troy, CPA, CTSBO, Senior Financial Analyst for Campus Support

And Human Resources

Vanessa Terrazas, Senior Financial Analyst for Instruction

Nancy Bomer, Senior Financial Analyst for Business Services and Operations

Shanna Toborg, District Treasurer

Chana Floyd, Senior Accountant

Janie Villarreal, Senior Accounting Manager

Emma Jackson, CPP, Payroll Manager

Internal Audit:

Sharon Lyerly, CIA, CISA, CGAP, Director of Internal Audit


Page Exhibit INTRODUCTORY SECTION Letter of Transmittal v GFOA Certificate of Achievement xi List of Elected Officials and Administrators xii Certificate of Board xiii Organization Chart xiv FINANCIAL SECTION Independent Auditors’ Report 1 Management’s Discussion and Analysis 5 Basic Financial Statements: Government-Wide Financial Statements: Statement of Net Position 23 A – 1 Statement of Activities 24 B – 1 Fund Financial Statements: Balance Sheet – Governmental Funds 26 C – 1 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position 28 C – 2 Statement of Revenues, Expenditures, and Changes in Fund Balance – Governmental Funds 30 C – 3 Reconciliation of the Governmental Funds Statement of Revenues,

Expenditures, and Changes in Fund Balances to the Statement of Activities 32 C – 4 Statement of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – General Fund 33 C – 5 Statement of Net Position – Proprietary Funds 34 D – 1 Statement of Revenues, Expenses, and Changes in Fund Net Position – Proprietary Funds 35 D – 2 Statement of Cash Flows – Proprietary Funds 36 D – 3 Statement of Fiduciary Net Position – Fiduciary Funds 38 E – 1

Statement of Changes in Fiduciary Fund Net Position – Fiduciary Funds 39 E – 2

Notes to the Financial Statements 41 REQUIRED SUPPLEMENTARY INFORMATION Schedule of the District’s Proportionate Share Of the Net Pension Liability 93 G – 1 Schedule of District Contributions 94 G – 2

Page Exhibit SUPPLEMENTARY INFORMATION Combining and Individual Fund Statements and Schedules: Nonmajor Governmental Funds – Fund Descriptions 97

Combining Balance Sheet – Nonmajor Governmental Funds 104 H – 1 Combining Statement of Revenues, Expenditures, and Changes In Fund Balances – Nonmajor Governmental Funds 110 H – 2 Internal Service Funds – Fund Descriptions 117 Combining Statement of Net Position – Internal Service Funds 120 H – 3 Combining Statement of Revenues, Expenses, and Changes In Fund Net Position – Internal Service Funds 122 H – 4 Combining Statement of Cash Flows – Internal Service Funds 12 4 H – 5 Enterprise Funds – Fund Descriptions 129 Combining Statement of Net Position – Nonmajor Enterprise Funds 130 H – 6 Combining Statement of Revenues, Expenses, and Changes In Fund Net Position – Nonmajor Enterprise Funds 132 H – 7 Combining Statement of Cash Flows – Nonmajor Enterprise Funds 134 H – 8 Agency Funds – Fund Descriptions 138 Combining Statement of Changes in Assets and Liabilities – All Agency Funds 139 H – 9

Schedules Required by the Texas Education Agency: Schedule of Delinquent Taxes Receivable 142 J – 1 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – National School Breakfast and Lunch Program Fund 144 J – 2 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – Debt Service Fund 145 J – 3 STATISTICAL SECTION (unaudited) Statistical Section Overview 147 Financial Trend Information: Government –Wide Information Net Position by Component – Last Ten Years 150 Governmental Activities Revenues and Expenses – Last Ten Years 152 Business-Type Activities Revenues and Expenses – Last Ten Years 154 General Revenues and Changes in Net Position – Last Ten Years 156 Fund Balances, Governmental Funds – Last Ten Years 158 Governmental Fund Revenues – Last Ten Years 160 Governmental Fund Expenditures by Function – Last Ten Years 162

Page Exhibit General Fund Other Sources, Uses, and Changes in Fund Balance - Last Ten Years 164 General Fund Revenues per ADA – Last Ten Years 166 General Fund Expenditures per ADA – Last Ten Years 168 Revenue Capacity Information Assessed and Actual Value of Taxable Property – Last Ten Years 172 Direct and Overlapping Property Tax Rates – Last Ten Years 174 Property Tax Levies and Collections – Last Ten Years 176 Principal Property Taxpayers – Current Year and Nine Years Prior 177 Allocation of Tax Rates and Levies – Last Ten Years 178 Debt Capacity Information Outstanding Debt by Type – Last Ten Years 180 Direct and Overlapping Debt as of June 30, 2015 181 Debt Margin Information – Last Ten Years 182 Debt to Net Assessed Valuation – Last Ten Years 184 Bonded Debt to Operating Expenditures – Last Ten Years 186 Demographic and Economic Information Demographic and Economic Information – Last Ten Years 188 Student Demographic Information – Last Ten Years 189 Principal Employers – Current Year 190 Commercial and Residential Construction - Last Ten Years 191 Operating Information Employees by Full Time Equivalent by Job Function – Last Ten Years 194 Teacher Salary Comparison – Last Ten Years 196 Operating Statistics – Last Ten Years 197 Fidelity Bonds – Current Year 198 School Building Information – Last Ten Years 200 FEDERAL AWARDS SECTION Independent Auditors’ Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance With Government Auditing Standards 203 Independent Auditors’ Report on Compliance For Each Major Program and on Internal Control Over Compliance Required by OMB Circular A-133 205 Schedule of Findings and Questioned Costs 207 Summary Schedule of Prior Audit Findings 209 Schedule of Expenditures of Federal Awards 210 K – 1 Notes to Schedule of Expenditures of Federal Awards 213

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November 9, 2015 Mrs. Letti Bresnahan, President, Board of Trustees, and Patrons of the North East Independent School District Dear Mrs. Bresnahan, Board of Trustees and Patrons: Management hereby submits the Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30, 2015. The North East Independent School District’s (the District) Finance and Accounting Department prepared the CAFR in accordance with generally accepted accounting principles (GAAP). The CAFR is management’s report of financial operations to the Board of Trustees (the Board), taxpayers, grantor agencies, employees, the Texas Education Agency, and other interested parties. The financial statements in this report provide an overview of the District’s operation and financial position as a whole and of its individual funds. Responsibility for the accuracy and completeness of the financial statements and fairness of the presentation, including all disclosures, rests with the District. We believe the data, as presented, is accurate in all material respects. The Texas Education Agency (TEA) requires all school districts publish within 150 days of the close of each fiscal year a complete set of financial statements presented in conformity with GAAP and audited in accordance with generally accepted auditing standards (GAAS) by a firm of licensed certified public accountants. Management’s Discussion and Analysis (MD&A) is a required narrative introduction, overview, and analysis of the basic financial statements and should be read in conjunction with this letter of transmittal. The District’s MD&A can be found immediately following the report of the independent auditors. DISTRICT PROFILE The District provides a full range of educational services appropriate to grade levels Pre-K through 12. These include regular and enriched academic education, special education for students with disabilities, gifted and talented classes and many individualized programs, such as specialized instruction for at-risk students and those with limited English proficiency. These

North East Independent School District 8961 TESORO DRIVE – SAN ANTONIO, TEXAS 78217-6225

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basic programs are supplemented by a wide variety of offerings in career and technology, fine arts, and athletics. The District encompasses approximately 140 square miles in north and northeast Bexar County. Founded in 1949, the District has operated as an independent school district since 1955. The District is one of the 10 largest districts in the State of Texas with a projected enrollment of more than 67,700 students for the 2015-2016 school year. The District is an urban-suburban community, lying within the boundaries of San Antonio and encompassing several smaller municipalities. All campuses are fully accredited by the TEA. The District tailors its instructional programs to enrich and expand student learning and exposure to the tenets of responsible citizenship. District leaders believe this philosophy is instrumental in keeping the completion rate high (95%) and the District’s number of college-bound students high. The Board constitutes the governing body elected from seven single-member districts and sets the tone for instruction and service to students and patrons with its mission statement and goals. Internal and Budgetary Controls The District has established a comprehensive internal control framework designed both to protect the District’s assets from loss, theft or misuse and to compile sufficiently reliable information for the preparation of the District’s financial statements in conformity with GAAP. Internal controls are designed to provide management with reasonable, but not absolute, assurance assets are safeguarded against loss from unauthorized use or disposition and those transactions are executed in accordance with management’s authorization and recorded properly. The concept of reasonable assurance recognizes the cost of a control should not exceed the benefits likely to be derived, and the evaluation of costs and benefits requires estimates and judgments by management. As a recipient of federal, state and local grants, the District is also responsible for an adequate internal control structure that ensures compliance with applicable laws and regulations related to the grants. All funded grants are subject to testing as part of the District’s Single Audit as mandated by the Office of Management and Budget Circular A-133. The results of the District’s Single Audit for the fiscal year ended June 30, 2015, provided no instances of material weaknesses in the internal control structure or significant violations of applicable laws and regulations. The report may be viewed in the Federal Awards section of the CAFR. Budgetary controls are established in accordance with TEA regulations and District policy for all managers with line-item responsibility. TEA regulations set the level of budgetary control at the functional expenditure level. The Board authorized the administration, through resolution, to provide budgetary transfers when there is no impact on the fund balance. These transfers are approved by the Board in a subsequent budget amendment. The Board must approve all budget amendments impacting fund balance of the General, Debt Service and National School Breakfast and Lunch Program Funds. The District utilizes a line-item budget of proposed expenditures and the means of financing them. The emphasis of the budget process is to identify the activities requiring resources and to rank those activities according to the needs of the entire District. Administrators have the responsibility to develop and manage their own program budgets once

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approved. Budget amendments are presented to the Board for approval throughout the fiscal year. Summary of Achievements The District’s achievements continue to be heralded in local, state and national publications. The success of the District is evidenced in its students’ high standardized test scores, Advanced Placement Program participation and abundant scholarships and awards presented to the District’s students. The District enjoys a well-deserved reputation for academic and financial excellence, and continues to receive numerous accolades for the performance of its students. Most recently, the District has been recognized for the following:

• The District received a rating of Passed on the Schools Financial Integrity Rating System of Texas (FIRST) earning 30 of a possible 30 points. This is the 13th year in a row the District has earned the State’s highest financial accountability rating.

• The District’s administrative costs as a percent of instructional costs for 2013-2014 was 4.90 percent. This was the lowest of all districts in Bexar County and places the District in the top three percent of all Texas school districts.

• In 2014-2015, the District had 13 National Merit Finalists, 15 National Merit Semifinalists, 69 Commended Scholars, 58 Hispanic Scholars, and three Achievement Scholars.

• Almost 95 percent of the District’s 2015 graduates planned to attend a two-year, four-year, trade, technical or business school/institution. They received $70.8 million in scholarship offers.

• In 2015, the District graduated 818 Summa Cum Laude students (100+ average).

• In 2015, the Washington Post included eight District high schools on its list of America’s

Most Challenging High Schools. (Churchill, International School of the Americas, Johnson, Lee, MacArthur, Madison, Reagan and Roosevelt).

• Six of the District’s high schools were deemed as some of the best in the nation,

according to U.S. News & World Report’s 2015 ranking: International School of the Americas (Gold National Rank: 317/State Rank: 47); Johnson High School (Silver National Rank: 748/State Rank: 84); Reagan High School (Silver National Rank: 782/State Rank: 89); MacArthur High School (Silver National Rank: 1670/State Rank: 156); Lee High School (Silver National Rank: 1968/State Rank: 172); Roosevelt High School (Awarded with Bronze status)

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• In 2015, the District’s Board of Trustees was named one of five Honor Boards from all across Texas by the Texas Association of School Administrators. They were selected for this honor because of their commitment to students, a code of ethics and positive relationships.

ECONOMIC CONDITION AND OUTLOOK Property Tax and State Revenue School districts in the State of Texas are funded through two main sources of revenue: local property taxes and State aid that is based on the number of students in the District, the type of instructional services provided, and the school district’s property wealth and tax collection efforts. Additional property tax revenue can be generated by increasing the property tax rate or by an increase in valuation of property within the district. Since 2007-2008, the District has levied a property tax rate for maintenance and operations (M&O) of $1.04 per hundred dollars of taxable property value – the maximum rate that a school district can levy without prior approval by district voters. Property values within the District are projected to increase by approximately $33.4 billion, or eleven percent, for the 2015-2016 fiscal year. Offsetting that increase is a change in the standard homestead exemption from $15,000 to $25,000. Texas voters approved the increased exemption through a constitutional amendment. The increased exemption lowers taxable property value by approximately $760 million, resulting in a net increase to property value of approximately 8.5 percent. After combining the increased values with the increased exemption, the net increase to the District’s taxable property value is expected to be $2.6 billion, generating an additional $27 million of M&O property tax revenue. However, any local property value increase reduces State funding the following year. For example, the 2014-2015 property value increase of $1.9 billion will cause a reduction in State funding for 2015-2016 of $19.1 million. The District was able to lower its Interest & Sinking (I&S) tax rate for 2015-2016 by just over 2.5 cents, due to the increase in valuation and as a result of restructuring nearly $747 million of existing debt. Over the past three years, these refunding transactions lowered future principal and interest payments by more than $137 million. Over the past decade, the State legislature has reduced education funding in Texas. The decrease in funding has occurred by lowering the rate that school districts can assess for property taxes and by altering the funding formulas used to allocate funding for education. In the last legislative session, funding was partially restored. Despite the partial restoration of funds for education in the State budget, many school districts are still receiving less revenue than under previous funding formulas. Compared to funding formulas prior to the 2011 legislative reductions, the District was denied an additional $25.9 million in total revenue for 2013-2014 and $14.2 million in 2014-2015.

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For 2015-2016, the Legislature altered funding formulas again. First, the basic per-student allotment was increased 2%, increasing formula aid by $10.5 million. Second, the State created a “hold-harmless” funding mechanism to restore to districts the funds that will be lost in local property tax revenue due to the increased homestead exemption. The District expects to receive approximately $8 million in hold-harmless aid. Finally, funds provided to districts in the previous biennium to offset districts’ increased required contributions to the Teachers Retirement System of Texas were discontinued. This change will lower State aid by $4.3 million. Hundreds of Texas school districts and charter schools filed lawsuits alleging the funding system created by the Texas Legislature in 2011 was unconstitutional. The lawsuits were consolidated by the 250th District Court of Travis County and the trial commenced on October 22, 2012. In August 2014, District Court Judge John Dietz of Austin ruled that the State’s educational funding system is unconstitutional, as it (a) is inadequate to support a “general diffusion of knowledge;” (b) is inefficient as all students are not afforded substantially equal access to education funds, and (c) effectively creates a State-wide property tax. The State appealed the case to the Texas Supreme Court. Written arguments from both sides were submitted to the Supreme Court from April to August, 2015 and oral arguments were heard on September 1, 2015. A ruling is not expected until 2016. Local Economy The local economy continues to show signs of improvement. The unemployment rate dropped to 3.7 percent in August 2015, down from 4.8 percent in August 2014 and 5.8 percent in August 2013. Construction activity is at or above pre-recession levels, with the city adding nearly $2.5 billion in new property values to its rolls in 2015. The State of Texas is experiencing similar good news as the economy improves statewide. The improving economy generated 2.7 percent more in sales tax revenue for the State in their fiscal year 2015 than in fiscal year 2014, and the unemployment rate for the State dropped from 5.3 percent in 2014 to 4.4 percent in 2015. Long-Term Financial Planning

As one of the 10 largest school districts in the State of Texas, and with an evolving student population, the District must plan ahead. Student enrollment and demographics drives the District’s planning process along with management’s commitment to providing the best education possible to our students. The District’s strategic planning is an ongoing process led by the Superintendent and Executive Staff. The planning process begins with statistical analysis of the results of State mandated standardized testing and leads to the development of campus plans and educational programs to achieve the District’s goals. This planning process identifies the educational needs of the District to drive the campus plans and the proper allocation of all District resources.

It is the responsibility of the Finance and Accounting Department to oversee the financial planning, tracking and accounting for the finances of the District in serving the community and its students. The Superintendent’s Office and Executive Staff oversee and coordinate all the elements involved in the strategic and financial planning process for the District on a long-term basis each fiscal year.

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The long-term financial plan for the District calls for the General Fund to maintain an amount equivalent to 2.5 months of operations in fund balance if possible. However, there are many factors outside of the District’s control that influence the District’s ability to achieve this. At the forefront is the school finance lawsuit. A negative ruling from the Texas Supreme Court could provide an opportunity for the Texas Legislature to resume education funding cuts. AWARDS AND ACKNOWLEDGMENTS Certificate of Achievement for Excellence in Financial Reporting The Government Finance Officers Association (GFOA) of the United States and Canada awarded a Certificate of Achievement for Excellence in Financial Reporting to the District for its Comprehensive Annual Financial Report for the year ended June 30, 2014. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report whose contents conform to program standards. Such reports must satisfy both GAAP and applicable legal requirements. This award is valid for a period of one year only. We believe our current report continues to conform to the Certificate of Achievement Program requirements, and we will once again submit it to the GFOA. Acknowledgments The preparation of this report on a timely basis involves the entire staff of the Finance and Accounting Department, including the Offices of Accounting and Payroll, Budget and Financial Analysis, Grant Administration and Financial Control, and Employee Benefits and Risk Management. We also want to express our appreciation to the bookkeepers and administrative assistants for their contributions to the process. We are grateful for everyone’s assistance in making this system work smoothly and efficiently. We thank our independent auditor ABIP, P.C., whose professional competence and leadership assisted us in developing this award-winning report.

//signature on file// //signature on file// Brian Gottardy, Ed.D., Superintendent of Schools Daniel Villarreal, C.P.A., RTSBA, Associate Superintendent

for Business Services/ Chief Financial Officer

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List of Elected Officials and Administrators

Board of Trustees

Name Title Mrs. Letti Bresnahan President Mrs. Shannon Grona Vice President Mrs. Sandy Hughey Secretary Mr. Edd White Member Mrs. Brigitte Perkins Member Mrs. Sandi Wolff Member Mr. Jim Wheat Member

Administrators Dr. Brian Gottardy Superintendent of Schools Dr. Donna Newman Associate Superintendent for Campus Administration and

Human Resources Dr. Pauline Dow Associate Superintendent for Instruction and

Technology Services/ Chief Instructional Officer

Ronald Clary Associate Superintendent

for Operations Dan Villarreal, CPA Associate Superintendent for

Business Services/ Chief Financial Officer

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Certificate of Board North East Independent School District Bexar 015-910

Name of Local Education Agency County County-District Number We, the undersigned, certify that the attached auditors’ report of the above-named school

district was reviewed and (check one) [ X ] approved [ ] disapproved for the year ended

June 30, 2015, at a meeting of the Board of School Trustees of such school district on the 9th

day of November, 2015.

//signature on file// //signature on file// Signature of Board Secretary Signature of Board President


Organization Chart

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1800 Saint James Place, Suite 100, Houston, Texas 77056713‐954‐2002 Main 713.954.2022 Fax

www.abipcpa.com

4801 NW Loop 410, Suite 725, San Antonio, Texas 78229210‐341‐2581 Main 210.341.2588 Fax

www.abipcpa.com

Independent Auditor’s Report

Board of Trustees North East Independent School District San Antonio, Texas Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of North East Independent School District (the District) as of and for the year ended June 30, 2015, and the related notes to the financial 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 accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial 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 financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatements of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’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 entity’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. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of North East Independent School District as of June 30, 2015, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America and the respective budgetary comparison for the general fund. Emphasis of Matter As described in Note I. E to the financial statements, in 2015, the District adopted new accounting guidance, GASB Statement No. 68, Accounting and Reporting for Pensions. Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, as listed in the table of contents, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

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Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise North East Independent School District's basic financial statements. The introductory section, combining and individual non-major fund financial statements, schedules required by Texas Education Agency and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The schedule of expenditures of federal awards is presented for purposes of additional analysis as required by U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is also not a required part of the basic financial statements. The combining and individual non-major fund financial statements, schedules required by the Texas Education Agency, and the schedule of expenditures of federal awards are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial 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 financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual non-major fund financial statements, schedules required by Texas Education Agency, and the schedule of expenditures of federal awards are fairly stated in all material respects in relation to the basic financial statements as a whole. 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 do not express an opinion or provide any assurance on them. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 9, 2015, on our consideration of North East Independent School 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. 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 North East Independent School District’s internal control over financial reporting and compliance.

Certified Public Accountants San Antonio, Texas November 9, 2015

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Management’s Discussion and Analysis


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(Unaudited) In this section of the Comprehensive Annual Financial Report, North East Independent School District (the District) discusses and analyzes its financial performance for the year ended June 30, 2015. Please read this section in conjunction with the transmittal letter, the independent auditors' report, and the District's Basic Financial Statements.

FINANCIAL HIGHLIGHTS

• Governmental Accounting Standards Board Statement (GASB) No. 68, Accounting and Financial Reporting for Pensions, went into effect for 2014-2015. The major effects of the implementation were as follows:

o a decrease of Government-wide net position of $86.4 million as a prior period restatement, reflecting the effect of the new standard to the District’s June 30, 2014 net position;

o an increase to noncurrent liabilities of $75.2 million; o an increase to deferred outflow of resources of $16.9 million; o an increase to deferred inflows of resources of $23.0 million; o an increase to government-wide expenses of $6.9 million.

More information regarding the change to pension reporting can be found in Footnote IV H to the financial statements.

• Government-wide net position totaled $119.9 million as of June 30, 2015. This was a decrease of $71.0 million from the previous year, reflective of an increase of $15.4 million from operations and the decrease of $86.4 million from the prior period restatement discussed above.

• The District’s total assets decreased $60.8 million from the previous year, primarily due to a decrease in cash and investments of $137.6 million and an increase of $76.8 million in capital assets, as the District continued to renovate and construct new building as part of its bond program. The decrease in cash and investments also relates to the decrease in non-current liabilities of $51.4 million (net of the effect of the GASB No. 68 recognition of $75.2 million in net pension liability) as the District continues to pay down its bond obligations.




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• Total liabilities increased $21.3 million with $75.2 million of the increase due to the implementation of GASB 68, as noted above. Had the statement been in effect in the previous year, the District’s net pension liability as of June 30, 2014 would have been $92.4 million. Exclusive of the change to net pension liability, liabilities decreased $53.9 million, due to lower bonds payable and interest payable.

• Government-wide expenses increased $3.6 million from the previous year, with the most significant increases being a district-wide salary increase for all employees, a State mandated increase to the District’s pension contributions, and the effect to operating expenses for the implementation of GASB 68, as noted above.

• The General Fund ended the year with a fund balance of $115.1 million, which is $1.0 million more than the previous year-end. The unassigned portion of fund balance increased by $0.9 million to $112.6 million. The fund balance amount available for operations is equal to approximately 2.7 months of daily operations.

• During fiscal year 2014-2015, the District issued $533.9 million in bonded debt. The debt issuances consisted of $466.6 million in refunding debt and $67.3 million in remarketed variable rate debt. The refunding debt defeased $491.1 million in existing debt resulting in a reduction of its debt service obligations of $94.1 million.




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USING THIS ANNUAL REPORT This annual report consists of a series of financial statements. The two major categories of statements are the government-wide statements and the fund financial statements. The government-wide financial statements include the Statement of Net Position and the Statement of Activities. These statements provide information about the activities of the District as a whole and present a longer-term view of the District's property and debt obligations and other financial matters. They reflect the flow of total economic resources in a manner similar to the financial reports of a private business enterprise. The fund financial statements report the District's operations in more detail than the government-wide statements by providing information about the District's most significant funds. For governmental activities, these statements indicate how services were financed for the short term and identify the resources that remain for future spending. The fund financial statements reflect the flow of current financial resources and supply the basis for tax levies and the appropriations budget. The fund financial statements for proprietary activities reflect how the District’s goods or services were charged to District departments or to external customers and how the sales revenues covered the expenses of the goods or services. The fiduciary statements provide financial information about activities for which the District acts solely as a trustee or agent for the benefit of those outside of the District. The notes to the financial statements provide narrative explanations or additional data needed for full disclosure in the government-wide statements or the fund financial statements. The combining statements for Nonmajor Governmental Funds provide additional information about the District's individual funds. The Federal Awards Section contains data used by monitoring or regulatory agencies to determine the District’s compliance with the terms of grant awards.




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The Statement of Net Position and the Statement of Activities The primary purpose of the government-wide financial statements (the Statement of Net Position and the Statement of Activities) is to show positive or negative changes in the District’s financial condition as a result of this fiscal year's activities. The Statement of Net Position includes all District assets and liabilities at the end of the year while the Statement of Activities includes all revenues and expenses generated by the District's operations for the fiscal year. These statements reflect private sector accounting practices based on full accrual reporting for revenues and expenses. The District's revenues are divided as follows: (1) program revenues provided by outside parties who share the costs of some programs, such as tuition from students outside the District or U.S. Department of Education grants to assist low-income children or those with disabilities; and (2) general revenues provided by local taxpayers or the Texas Education Agency’s (TEA) State foundation program. All District assets are reported whether they serve the current year or future years. Liabilities are considered regardless of whether they must be paid in the current or future years. The District's net position (the difference between assets and liabilities) provide one measure of the District's financial health, or financial position. Over time, increases or decreases in the District's net position is one indicator of whether its financial health is improving or deteriorating. To fully assess the overall health of the District, one should also consider non-financial factors, such as changes in the District’s average daily attendance, changes in its property tax base, the condition of the District’s facilities, as well as the District’s academic rating. Exclusive of the prior period adjustment, the District experienced a slight increase in government-wide net position. The District’s property tax base valuation increased by 7.2% from the prior year. The tax rate for the District’s operations remained at $1.04 per hundred dollars of valuation for fiscal year 2014-2015 which is the same rate for the past eight fiscal years. The resulting increase in property tax revenue was $27.8 million. State aid remained flat for 2014-2015. The District’s growth in prior years, along with the age and condition of several facilities, has necessitated the renovation of existing facilities and construction of additional facilities. The need for additional or improved facilities is continually reassessed to ensure that our students are best served. The growth is evidenced by the increases in capital assets.




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In the Statement of Net Position and the Statement of Activities, the District’s operations are categorized into two types of activities:

• Governmental activities: Most of the District's basic services are reported here, including instruction, counseling, co-curricular activities, food services, transportation, maintenance, community services, and general administration. Property taxes, tuition, fees, and state and federal grants finance most of these activities.

• Business-type activities: Revenue-generating activities are reported here. The North

East Aquatics and Tennis Fund is a business activity that charges its customers a fee to use the facilities at the Josh Davis Natatorium and adjacent tennis facilities. Uniform Rental is also a business activity that charges participants for uniform rental in various Fine Arts programs. Property Management is responsible for managing and renting District facilities to the general public. This activity is also responsible for disposal of obsolete or surplus assets. The Preschool Program for Children with Disabilities Fund provides daycare services for children with disabilities and for children of District employees. The final business-type activity is the Community Education program, which offers courses to the general public for a fee in addition to operating an after-school care program for children.

Fund Financial Statements The fund financial statements provide detailed information about the most significant funds, not the District as a whole. Laws and contracts require the District to establish some funds, such as grants received under the U. S. Department of Education’s No Child Left Behind Act. The District's administration establishes many other funds to help it control and manage funding for particular purposes (like campus activities). The District's two types of funds–governmental and proprietary–use different accounting approaches:

Governmental Funds: Most of the District's basic services are reported in governmental funds. These funds use modified accrual accounting, which measures the receipt and disbursement of cash and all other financial assets that can be readily converted to cash, and reports balances available for future spending. The governmental fund statements provide a detailed short-term view of the District's general operations and the basic services it provides. Reconciliation schedules following each of the fund financial statements describe the differences between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds.




10

Proprietary Funds: These funds report activities where the District charges users (whether outside customers or other units of the District) for services. Proprietary funds use the same full accrual accounting methods employed in the Statement of Net Position and the Statement of Activities. The District has two types of proprietary funds: enterprise funds and internal service funds. Enterprise funds are reported as business-type activities in the government-wide statements. The District’s Enterprise Funds provide goods and services to external parties and include:

Property Management Uniform Rental Community Education Preschool Program for Children with Disabilities North East Aquatics and Tennis

Internal Service Funds provide supplies and services for the District’s other funds and include:

Document Management & Printing Services Health Insurance Data Processing Center Network Technology Services Dental Insurance Workers’ Compensation Insurance Rolling Owner Controlled Insurance Program Unemployment Compensation Insurance Police Services

Reporting the District's Fiduciary Responsibilities The District is the trustee, or fiduciary, for money raised by student activity programs, employee groups, and donations for specific purposes where both the principal and earnings may be expended. All of the District's fiduciary activities, Student Activity Funds, Central Office Fund, and the Private Purpose Trust Fund for Scholarships, are reported in a separate Statement of Fiduciary Net Position. These resources are excluded from the District's other financial statements since the District cannot use these assets to finance its operations. The District’s only fiduciary responsibility is to ensure that the assets reported in these funds are used for their intended purposes.




11

GOVERNMENT-WIDE FINANCIAL ANALYSIS This analysis focuses on Governmental Activities Net Position (Table I). The District’s Net Position attributable to governmental activities are reported at $106.2 million as of June 30, 2015. Net position decreased $69.5 million from the prior year mainly due to a prior period adjustment. The prior period adjustment reduced net assets by $86.4 million by recognizing a net pension liability and associated pension expense in conjunction with the implementation of a new accounting standard. Current assets decreased as payments were made on existing debt. Capital assets also increased from the prior year due to continued construction in the existing bond program. Overall, the District’s investment in capital assets to meet its infrastructure needs represents 75.0% of the total assets. The District capitalized $134.8 million in expenditures during the fiscal year, with the majority of that amount being capitalized as buildings and improvements. The remaining 25.0% is comprised mainly of cash, cash equivalents and investment balances. The amount of bond proceeds invested for future construction totals $131.3 million. Debt payable to bond holders represents the District’s major liabilities. The total bond debt represents 89.2% of the District’s total liability to outside interests. The remaining amount is comprised of amounts owed to vendors, employees, and for actuarially determined liabilities related to the District’s self-funded insurance liabilities and its net pension liability. The District’s net investment in capital assets decreased $2.0 million as the growth in capital assets is offset by related debt and the accumulated depreciation/amortization on those assets.




12

Governmental Activities 2015 2014 Change

Current and Other Assets $ 455,681.8 $ 593,284.3 $ (137,602.5) -23.2 %Capital Assets 1,370,942.7 1,294,131.2 76,811.5 5.9 % Total Assets 1,826,624.5 1,887,415.5 (60,791.0) -3.2 %Deferred Outflows 61,847.8 26,262.7 35,585.1 100 %

Other Liabilities 114,065.1 116,613.2 (2,548.1) -2.2 %Long Term Liabilities 1,645,190.2 1,621,348.6 23,841.6 1.5 % Total Liabilities 1,759,255.3 1,737,961.8 21,293.5 1.2 %Deferred Inflows 23,015.3 - 23,015.3 100 %

Net Position:Net Investment in Capital Assets 337.2 2,296.1 (1,958.9) -85.3 %Restricted 102,759.3 100,508.6 2,250.7 2.2 %Unrestricted 3,105.3 72,911.7 (69,806.4) -95.7 %Governmental Net Position $ 106,201.8 $ 175,716.4 $ (69,514.6) -39.6 %

Business-Type ActivitiesCurrent and Other Assets $ 4,614.8 $ 6,023.9 $ (1,409.1) -23.4 %Capital Assets 9,355.3 9,374.0 (18.7) -0.2 % Total Assets 13,970.1 15,397.9 (1,427.8) -9.3 %

Other Liabilities 236.1 190.2 45.9 24.1 % Total Liabilities 236.1 190.2 45.9 24.1 %

Net Position:Net Investment in Capital Assets 9,355.3 9,374.0 (18.7) -0.2 %Unrestricted 4,378.7 5,833.7 (1,455.0) -24.9 %Business-Type Net Position $ 13,734.0 $ 15,207.7 $ (1,473.7) -9.7 %

Government-Wide TotalsCurrent and Other Assets $ 460,296.6 $ 599,308.2 $ (139,011.6) -23.2 %Capital Assets 1,380,298.0 1,303,505.2 76,792.8 5.9 % Total Assets 1,840,594.6 1,902,813.4 (62,218.8) -3.3 %Deferred Outflows 61,847.8 26,262.7 35,585.1 100.0 %

Other Liabilities 114,301.2 116,803.4 (2,502.2) -2.1 %Long Term Liabilities 1,645,190.2 1,621,348.6 23,841.6 1.5 % Total Liabilities 1,759,491.4 1,738,152.0 21,339.4 1.2 %Deferred Inflows 23,015.3 - 23,015.3 100 %

Net Position:Net Investment in Capital Assets 9,692.5 11,670.1 (1,977.6) -16.9 %Restricted 102,759.3 100,508.6 2,250.7 2.2 %Unrestricted 7,484.0 78,745.4 (71,261.4) -90.5 %Government-Wide Net Position $ 119,935.8 $ 190,924.1 $ (70,988.3) -37.2 %

Table INET POSITION(In Thousands)

Percent Change




13

GOVERNMENTAL ACTIVITIES FINANCIAL ANALYSIS Changes in Governmental Activities Net Position are presented in Table II. The District's Governmental Activities revenues were $713.1 million, an increase of 4.2 percent from the prior year. The District’s two main sources of revenue are aid from the State and local property tax revenues. These two sources comprise approximately 84% of government-wide revenue as shown in Figure A-1 below. Revenues increased by $28.6 million from the prior year. The increase in revenue is due to an increase in property tax revenue as a result of a 7.2 percent increase in the value of the property tax base.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%Figure A-1 Governmental Activities Revenues by Source

Oth er

Gran ts

S tate Aid

Taxes

The expenses for governmental activities totaled $698.2 million, an increase of $3.6 million over the prior year. This is primarily due to a raise in employee salaries given during the fiscal year, and an increase to the required district contribution to the state’s pension fund.




14

Total Total2015 2014

Program Revenues: Charges for Services $ 22,951.2 $ 23,009.8 $ (58.6) -0.3 % Operating Grants and Contributions 79,819.6 76,009.9 3,809.7 5.0 %General Revenues:

Property Taxes General 438,681.8 410,848.2 27,833.6 6.8 %State Aid 159,179.4 160,877.6 (1,698.2) -1.1 %Grants & Contributions not Restricted 6,955.0 7,427.9 (472.9) -6.4 %Investment Earnings 1,102.7 1,541.2 (438.5) -28.5 %Miscellaneous 4,458.0 4,879.4 (421.4) -8.6 % Total Revenues 713,147.7 684,594.0 28,553.7 4.2 %

Expenses: Instruction, Media and Curriculum 403,714.4 389,448.9 14,265.5 3.7 % Instructional and School Leadership 42,127.2 40,681.2 1,446.0 3.6 % Student Support 102,724.7 100,724.0 2,000.7 2.0 % General Administration 11,028.1 10,952.5 75.6 0.7 % Plant Maintenance, Security and Data Processing 84,552.7 84,566.5 (13.8) 0.0 % Community Services 500.9 381.9 119.0 31.2 % Debt Services 50,729.7 64,949.0 (14,219.3) -21.9 % Intergovernmental Charges 2,821.1 2,891.1 (70.0) -2.4 %

Total Expenses 698,198.8 694,595.1 3,603.7 0.5 %

Increase or (Decrease) in Net Position Before Transfers 14,948.9 (10,001.1) 24,950.0 249.5 %

Transfers In 1,960.6 466.7 1,493.9 320.1 %

Change in Net Position 16,909.5 (9,534.4) 26,443.9 277.4 %

Beginning Net Position 175,716.4 191,962.3 (16,245.9) -8.5 %

Prior Period Adjustment (86,424.1) (6,711.5) (79,712.6) -100.0 %

Ending Net Position $ 106,201.8 $ 175,716.4 $ (69,514.6) -39.6 %

Change in Amount

Table IICHANGES IN GOVERNMENTAL ACTIVITIES NET POSITION

(In Thousands)

PercentChange




15

BUSINESS-TYPE ACTIVITIES FINANCIAL ANALYSIS Net position attributable to business-type activities decreased slightly to $13.7 million (Table III). There are five Enterprise Funds working to support the school district and the needs of its community. Community Education is by far the best performer, generating $8.7 million in revenue.

Total Total2015 2014

Program Revenues: Charges for Services

Property Management $ 602.8 $ 763.3 $ (160.5) (21.03) %Uniform Rentals 63.2 62.4 0.8 1.3 %Community Education 8,684.8 7,914.1 770.7 9.7 %Preschool Program for Children

with Disabilities 600.6 573.6 27.0 4.7 %NEAT 805.3 816.4 (11.1) (1.4) %

Total Program Revenues 10,756.7 10,129.8 626.9 6.2 % Expenses:

Property Management 734.2 798.9 (64.7) (8.1) %Uniform Rentals 116.7 71.6 45.1 63.0 %Community Education 8,000.4 7,792.7 207.7 2.7 %Preschool Program for Children

with Disabilities 647.0 650.0 (3.0) (0.5) %NEAT 771.5 751.1 20.4 2.7 %Total Expenses 10,269.8 10,064.3 205.5 2.0 %

Increase or (Decrease) in Net Position Before Transfers 486.9 65.5 421.4 643.4 %

Transfers Out (1,960.6) (466.7) (1,493.9) -320.1 %

Change in Net Position (1,473.7) (401.2) (1,072.5) -267.3 %

Beginning Net Position 15,207.7 15,608.9 (401.2) -2.6 %

Ending Net Position $ 13,734.0 $ 15,207.7 $ (1,473.7) (9.7) %

Table IIIBUSINESS ACTIVITIES CHANGES IN NET POSITION

(In Thousands)

Change in Amount

PercentChange




16

FUND FINANCIAL ANALYSIS As the District completed the fiscal year, the Governmental Funds reported a combined fund balance of $324.0 million, which is approximately $143.6 million less than last year's total of $467.6 million. The primary reason for the Governmental Fund’s decrease in fund balance is due to the expenditures in the Capital Projects Fund for the construction of school facilities and related equipment. All related bond proceeds were received in previous years. The General Fund had a slight increase in fund balance. Revenue from property taxes increased due to increased property values. The increase was offset by the additional salary expense incurred due to a raise given to employees and for increased District share of pension contributions. The Debt Service Fund had a net increase in fund balance of $2.9 million. This increase was due to the effects of issuing refunding debt and the transfer in of funds from the General Fund to set aside principal payments for the Qualified School Construction Bonds. These bonds are not due until 2027 but the District is proactively setting aside amounts assigned to pay the principal when they become payable. The increase in fund balance was budgeted for in order to meet debt service requirements and maintain a low tax rate for citizens. The I&S tax rate remained at $0.4006 per hundred dollars of valuation for fiscal year 2014-2015. The Board of Trustees adopts the budgets of the General, Debt Service, and National School Breakfast and Lunch Program funds. Over the course of the year, the Board revised the District's budget six times. These budget amendments are categorized into three classifications: (1) increase to the fund balance; (2) decrease to the fund balance; and (3) no change to the fund balance. This allowed the District to adjust its budget as circumstances and needs changed during the year. The net effect of the budget amendments during the year was to increase appropriations by approximately $18.5 million. The major change to budgeted appropriations was an increase to appropriations in the Debt Service Fund to reflect District contributions toward the refunding transactions that occurred throughout the year. Actual expenditures were less than the final budget in the General Fund by $19.1 million, or 3.6%, mainly attributable to budgeted salaries for positions that were vacant for all or part of the year. Actual expenditures were less than the final budget in the National School Breakfast and Lunch Program Fund by $1.8 million, or 5.4%, attributable to budgeted salaries for positions that were vacant for all or part of the year and various purchase orders not being filled prior to year-end. Actual expenditures in the Debt Service fund were less than the final budget by less than 1%.




17

CAPITAL ASSET AND DEBT ADMINISTRATION

Capital Assets As of June 30, 2015, the District had $1.4 billion, net of accumulated depreciation/amortization, invested in a broad range of capital assets, including facilities and equipment for instruction, transportation, athletics, administration, maintenance, and construction in progress. This represents a net decrease of $62.2 million from fiscal year 2013-2014. See Footnote IV E for more detailed analysis of the year’s capital asset activity. This year's government-wide capital asset major additions included (at historical cost): Land $ 2,052,109 Buildings and Improvements 4,602,487Furniture and Equipment 5,629,841Construction in Progress 124,276,990

$ 136,561,427

Debt At year-end, the District had $1.57 billion in bonds outstanding and unamortized issuance premiums. The District's general obligation bonds have received the highest rating possible from the national rating agencies because of the Permanent School Fund guarantee of the District’s debt. Other obligations include accrued vacation pay, sick leave, workers compensation accrued liability, a net other post-employment benefit (OPEB) liability, and a TRS net pension liability. Detailed information about the District's long-term liabilities is presented (Footnote IV L) in the Notes to the Financial Statements. NEXT YEAR'S BUDGETS AND RATES The District still faces significant uncertainty regarding its revenue despite the gains in State aid from the 2014 legislative session. Hundreds of school districts brought suit against the State of Texas, arguing the funding model in place is inadequate, inequitable, and creates an unconstitutional statewide property tax. The State district judge ruled in favor of the school districts on all counts in August 2015. The Texas Attorney General has appealed the case to the Texas Supreme Court. A final decision may not be known until late 2016.




18

At $1.04 per hundred dollars of assessed valuation, the District’s 2014-2015 M&O tax rate is at the State’s maximum rate without voter approval. Any additional M&O tax rate exceeding $1.04 will require voter approval up to a maximum ceiling of $1.17. The District is considered a property wealthy school district under Chapter 41 of the Texas Education Code. Under these provisions, the District’s State aid will be reduced to offset a portion of any tax revenue from a tax rate above $1.06 per hundred dollars of valuation to help fund property poor school districts. This restriction further limits the District’s ability to increase revenue from increases in property tax revenue. The future local share of the financial needs of the District will depend upon the willingness of its taxpayers to increase the local tax rate if additional funding is required to meet the educational needs of the District’s students. The following figure illustrates the projected (2016) and historical (2015 and prior) sources of the District’s operating revenue.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%General Fund Revenue By Source

Misc Local, State & FederalRevenue

State Formula Grants

Property Taxes

The I&S tax rate for the 2015-2016 fiscal year lowered to $0.3750 per hundred dollars of assessed valuation. The tax rate was determined by calculating the rate required to meet debt service obligations given the assessed value of real, business and personal property within the District’s boundaries and reflects the changes in debt service requirements associated with bonds issued to build and improve the District’s infrastructure.




19

For fiscal year 2015-2016, the Board of Trustees adopted a break-even general fund budget. The budgeted appropriations increased $9.7 million compared to the final 2014-2015 budget. The increase is mainly due to salary increases for all employees. The District estimates that the actual surplus for fiscal year 2015-2016 will be $12.5 million. The difference between the deficit in the adopted budget and the forecasted deficit is due to the District’s active management of the budget throughout the year and conservative estimates of staffing of vacant positions.

CONTACTING THE DISTRICT'S FINANCIAL MANAGEMENT This financial report is designed to provide citizens, taxpayers, customers, investors and creditors with a year-end picture of the District's finances. If you have questions about this report or need additional financial information, contact the Associate Superintendent for Business Services/Chief Financial Officer, Dan Villarreal, C.P.A., RTSBA, North East Independent School District, 8961 Tesoro Drive, San Antonio, Texas, 78217.

20


Basic Financial Statements

22


EXHIBIT A-1NORTH EAST INDEPENDENT SCHOOL DISTRICTSTATEMENT OF NET POSITION

JUNE 30, 2015

1 2 3

Control

Data

CodesGovernmental

Activities Activities

Type

Business

Total

Primary Government

ASSETS

5,218,504 178,257,305 183,475,809 Cash and Cash Equivalents $ $ $1110 - 209,086,203 209,086,203 Current Investments1120 - 21,205,048 21,205,048 Property Taxes Receivable (Delinquent)1220 - (1,726,297) (1,726,297)Allowance for Uncollectible Taxes1230 - 41,842,971 41,842,971 Due from Other Governments1240 - 538,530 538,530 Accrued Interest1250

(716,771)716,771 - Internal Balances1260 - 26,523 26,523 Due from Fiduciary Funds1267

113,068 927,560 1,040,628 Other Receivables, net1290 - 4,805,487 4,805,487 Inventories1300 - 1,749 1,749 Other Current Assets1490

Capital Assets:

2,547,600 94,704,382 97,251,982 Land15106,574,403 1,082,423,107 1,088,997,510 Buildings, Net1520

233,288 25,966,001 26,199,289 Furniture and Equipment, Net1530 - 167,849,198 167,849,198 Construction in Progress1580

Total Assets1000 1,826,624,538 13,970,092 1,840,594,630

DEFERRED O UTFLO WS O F RESO URCES

- 44,951,105 44,951,105 Deferred Charge for Refunding1701 - 16,896,722 16,896,722 Deferred Outflow Related to TRS1705

Total Deferred Outflows of Resources1700 61,847,827 - 61,847,827

LIABILITIES

42,921 16,180,261 16,223,182 Accounts Payable2110 - 21,406,659 21,406,659 Interest Payable2140 - 3,852,922 3,852,922 Payroll Deductions & Withholdings2150

90,733 56,784,720 56,875,453 Accrued Wages Payable2160 - 181,528 181,528 Due to Fiduciary Funds2177

7,396 23,251 30,647 Due to Other Governments218013,970 1,854 15,824 Due to Student Groups2190

- 13,617,072 13,617,072 Accrued Expenses220081,085 1,717,789 1,798,874 Unearned Revenue2300

Noncurrent Liabilities

- 52,920,968 52,920,968 Due Within One Year2501 - 1,517,330,997 1,517,330,997 Due in More Than One Year2502 - 75,237,231 75,237,231 Net Pension Liability (District's Share)2540

Total Liabilities2000 1,759,255,252 236,105 1,759,491,357

DEFERRED INFLO WS O F RESO URCES

- 23,015,292 23,015,292 Deferred Inflow Related to TRS2605

Total Deferred Inflows of Resources2600 23,015,292 - 23,015,292

NET PO SITIO N

9,355,291 337,201 9,692,492 Net Investment in Capital Assets3200Restricted:

- 9,838,392 9,838,392 Restricted for Federal and State Programs3820 - 92,720,939 92,720,939 Restricted for Debt Service3850 - 200,000 200,000 Restricted for Scholorships3880

4,378,696 3,105,289 7,483,985 Unrestricted3900

Total Net Position3000 106,201,821 13,733,987 119,935,808 $ $ $

23The notes to the financial statements are an integral part of this statement.

NORTH EAST INDEPENDENT SCHOOL DISTRICTSTATEMENT OF ACTIVITIES

FOR THE YEAR ENDED JUNE 30, 2015

Control

Data

CodesExpenses Services

Charges for

Contributions

Grants and

Operating

Program Revenues

431

Primary Government:GOVERNMENTAL ACTIVITIES:

5,094,590 375,521,024 40,744,160 Instruction $ $ $11

- 11,529,428 426,749 Instructional Resources and Media Services12

806,180 16,663,996 4,224,111 Curriculum and Staff Development13

- 6,736,551 1,267,610 Instructional Leadership21

879,470 35,390,638 1,740,262 School Leadership23

- 20,218,076 2,633,703 Guidance, Counseling and Evaluation Services31

- 4,017,672 1,811,907 Social Work Services32

- 7,782,708 475,988 Health Services33

- 20,486,754 952,455 Student Transportation34

12,858,113 33,228,511 19,949,936 Food Services35

2,191,998 16,990,955 275,450 Extracurricular Activities36

- 11,028,060 908,900 General Administration41

16,650 62,443,927 2,949,543 Facilit ies Maintenance and Operations51

- 4,307,086 412,093 Security and Monitoring Services52

- 17,801,725 321,224 Data Processing Services53

1,104,186 500,935 725,505 Community Services61

- 36,878,928 - Debt Service - Interest on Long Term Debt72

- 13,850,766 - Debt Service - Bond Issuance Cost and Fees73

- 406,752 - Instructional Shared Services Arrangements93

- 78,657 - Juvenile Justice Alternative Education Program95

- 2,335,660 - Property Tax Appraisal Services99

698,198,809 22,951,187 79,819,596 [TG] Total Governmental Activities:

BUSINESS-TYPE ACTIVITIES:602,736 734,221 - Property Management01

63,227 116,708 - Uniform Rentals02

8,684,821 8,000,362 - Community Education03

600,610 647,012 - Preschool Prgm for Children W/ Disabilit ies04

805,267 771,497 - North East Aquatics & Tennis06

10,269,800 10,756,661 - [TB] Total Business-Type Activities:

[TP] TOTAL PRIMARY GOVERNMENT: 708,468,609 33,707,848 79,819,596 $ $ $

DataControlCodes

General Revenues:Taxes:

Property Taxes, Levied for General PurposesMT

Property Taxes, Levied for Debt ServiceDT

State Aid - Formula GrantsSF

Grants and Contributions not RestrictedGC

Investment EarningsIE

Miscellaneous Local and Intermediate RevenueMI

Transfers In (Out)FR

Total General Revenues & TransfersTR

Net Position - Beginning

Change in Net Position

Net Position--Ending

Prior Period Adjustment

CN

NB

NE

PA


EXHIBIT B-1

Net (Expense) Revenue and

Activities Activities

Business Type

Total

Governmental

Changes in Net Position

6 7 8

Primary Government

- (329,682,274) (329,682,274)$ $ $

- (11,102,679) (11,102,679)

- (11,633,705) (11,633,705)

- (5,468,941) (5,468,941)

- (32,770,906) (32,770,906)

- (17,584,373) (17,584,373)

- (2,205,765) (2,205,765)

- (7,306,720) (7,306,720)

- (19,534,299) (19,534,299)

- (420,462) (420,462)

- (14,523,507) (14,523,507)

- (10,119,160) (10,119,160)

- (59,477,734) (59,477,734)

- (3,894,993) (3,894,993)

- (17,480,501) (17,480,501)

- 1,328,756 1,328,756

- (36,878,928) (36,878,928)

- (13,850,766) (13,850,766)

- (406,752) (406,752)

- (78,657) (78,657)

- (2,335,660) (2,335,660)

(595,428,026) - (595,428,026)

(131,485) - (131,485)

(53,481) - (53,481)

684,459 - 684,459

(46,402) - (46,402)

33,770 - 33,770

- 486,861 486,861

(595,428,026) 486,861 (594,941,165)

- 316,681,845 316,681,845

- 121,999,975 121,999,975

- 159,179,444 159,179,444

- 6,954,975 6,954,975

- 1,102,680 1,102,680

- 4,457,969 4,457,969

(1,960,594)1,960,594 -

612,337,482 (1,960,594) 610,376,888

16,909,456

175,716,418

106,201,821 $

(1,473,733)

15,207,720

13,733,987 $

15,435,723

190,924,138

119,935,808 $

(86,424,053) - (86,424,053)

25

NORTH EAST INDEPENDENT SCHOOL DISTRICT

BALANCE SHEET

GOVERNMENTAL FUNDS

JUNE 30, 2015

Control

Data

Codes

General

Fund Fund

Debt Service

50

Projects

Capital

6010

ASSETS36,651,086 31,998,187 79,943,767 Cash and Cash Equivalents $ $ $1110

51,382,403 92,318,681 52,516,067 Investments - Current1120

5,567,444 15,637,604 - Property Taxes - Delinquent1220

(431,197)(1,295,100) - Allowance for Uncollectible Taxes (Credit)1230

- 34,519,122 - Receivables from Other Governments1240

97,154 278,324 107,160 Accrued Interest1250

6,435,449 23,592,806 166,718 Due from Other Funds1260

30,520 526,312 13,723 Other Receivables1290

- 2,455,320 - Inventories1300

- 1,749 - Other Current Assets1490

Total Assets1000 200,033,005 99,732,859 132,747,435 $ $ $

LIABILITIES - 4,361,468 11,159,936 Accounts Payable $ $ $2110

- 3,852,922 - Payroll Deductions and Withholdings Payable2150

- 53,659,242 125 Accrued Wages Payable2160

10 15,667,953 13,968,779 Due to Other Funds2170

7,140 15,381 - Due to Other Governments2180

- 1,854 - Due to Student Groups2190

- - 9,324,283 Accrued Expenditures2200

- 35,055 - Unearned Revenues2300

Total Liabilities2000 77,593,875 7,150 34,453,123

DEFERRED INFLOWS OF RESOURCES2,443,449 7,338,899 - Unavailable Revenue - Property Taxes2601

Total Deferred Inflows of Resources2600 7,338,899 2,443,449 -

FUND BALANCESNonspendable Fund Balance:

- 2,455,320 - Inventories3410

- - - Long-Term Loans/Notes Receivable3415

Restricted Fund Balance: - - - Federal or State Funds Grant Restriction3450

- - 98,294,312 Capital Acquisition and Contractural Obligation3470

90,277,490 - - Retirement of Long-Term Debt3480

- - - Other Restricted Fund Balance3490

Committed Fund Balance: - - - Other Committed Fund Balance3545

Assigned Fund Balance:7,004,770 - - Other Assigned Fund Balance3590

- 112,644,911 - Unassigned Fund Balance3600

Total Fund Balances3000 115,100,231 97,282,260 98,294,312

$ 200,033,005 $ 99,732,859 $ 132,747,435 Total Liabilities, Deferred Inflows & Fund Balances4000

26

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

EXHIBIT C-1

Other

Funds Funds

Governmental

Total

10,277,021 158,870,061 $ $5,905,282 202,122,433

- 21,205,048 - (1,726,297)

7,323,511 41,842,633 18,032 500,670

1,789,823 31,984,796 17,314 587,869

1,428,438 3,883,758 - 1,749

26,759,421 459,272,720 $ $

302,211 15,823,615 $ $ - 3,852,922

2,293,413 55,952,780 9,132,626 38,769,368

543 23,064 - 1,854 - 9,324,283

1,682,734 1,717,789

13,411,527 125,465,675

- 9,782,348

- 9,782,348

51,430 2,506,750 200,000 200,000

9,786,962 9,786,962 - 98,294,312 - 90,277,490

25,248 25,248

3,284,254 3,284,254

- 7,004,770 - 112,644,911

13,347,894 324,024,697

$ $ 459,272,720 26,759,421

27

EXHIBIT C-2NORTH EAST INDEPENDENT SCHOOL DISTRICT

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THESTATEMENT OF NET POSITION

JUNE 30, 2015

324,024,697 $Total Fund Balances - Governmental Funds

37,718,039 1 The District uses internal service funds to charge the costs of certain activities, such as self-insurance and printing, to appropriate functions in other funds. The assets and liabilities of the internal service funds are included in governmental activities in the statement of net position. The net effect of this consolidation is to increase net position.

(333,729,965)2 Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds. At the beginning of the year, the cost of these assets was $1,835,187,803 and the accumulated depreciation was ($550,067,690). In addition, long-term liabilities, including bonds payable, are not due and payable in the current period, and, therefore are not reported as liabilities in the funds. Also not included are the deferred charges for issuance of refunding bonds (listed as deferred outflows of resources). The net effect of including the beginning balances for capital assets (net of depreciation) and long-term debt in the governmental activities is to (decrease) net position.

125,784,325 3 Current year capital outlays and long-term debt principal payments are expenditures in the fund financial statements,but they should be shown as increases in capital assets and reductions in long-term debt in the government-wide financial statements. The net effect of including the 2015 capital outlays and debt principal payments is to increase net position.

Included in items related to debt is the recognition of the District's proportionate share of the net pension liability required by GASB 68 and the change in deferred inflow and outflow realted to TRS Pension Liability.

This led to a net increase in net position.

(57,377,623)4 The 2015 depreciation expense increases accumulated depreciation. The net effect of the current year's depreciation is to decrease net position.

9,782,348 5 Various other reclassifications and eliminations are necessary to convert from the modified accrual basis of accounting to accrual basis of accounting. These include recognizing unavailable revenue from property taxes as revenue, eliminating interfund transactions, reclassifying the proceeds of bond sales as an increase in bonds payable, and recognizing the liabilities associated with maturing long-term debt and interest. The net effect of these reclassifications and recognitions is to increase net position.

106,201,821 $19 Net Position of Governmental Activities

28


29



STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

GOVERNMENTAL FUNDS


Control

Data

Codes Fund

General

10

Fund

Debt Service

50

Projects

Capital

60

REVENUES:323,560,117 122,723,287 435,116 Local and Intermediate Sources $ $ $5700181,054,370 - 203,789 State Program Revenues5800

7,048,002 1,830,973 - Federal Program Revenues5900

Total Revenues5020 511,662,489 124,554,260 638,905

EXPENDITURES:

Current:314,364,610 - - Instruction0011

8,596,661 - - Instructional Resources and Media Services001213,154,547 - - Curriculum and Instructional Staff Development0013

5,838,417 - - Instructional Leadership002134,034,618 - - School Leadership002318,269,067 - - Guidance, Counseling and Evaluation Services0031

2,441,364 - - Social Work Services00327,471,777 - - Health Services0033

17,952,885 - - Student Transportation003441,126 - - Food Services0035

10,937,982 - - Extracurricular Activities003611,282,025 - - General Administration004151,232,456 - - Facilit ies Maintenance and Operations0051

4,654,370 - - Security and Monitoring Services00524,520,579 - - Data Processing Services0053

181,496 - - Community Services0061

Debt Service: - 52,580,000 - Principal on Long Term Debt0071 - 60,576,951 - Interest on Long Term Debt0072 - 13,850,766 - Bond Issuance Cost and Fees0073

Capital Outlay:73,115 - 151,128,153 Facilit ies Acquisition and Construction0081

Intergovernmental:406,752 - - Instructional Shared Service Arrangements0093

78,657 - - Juvenile Justice Alternative Education Program00952,335,660 - - Property Tax Appraisal0099

Total Expenditures6030 507,868,164 127,007,717 151,128,153

1100 Excess (Deficiency) of Revenues Over (Under) Expenditures

3,794,325 (2,453,457) (150,489,248)

OTHER FINANCING SOURCES (USES): - 533,930,000 - Refunding Bonds Issued7901 - - - Sale of Real and Personal Property7912

160,185 1,700,000 1,809,392 Transfers In7915 - 60,168,687 - Premium or Discount on Issuance of Bonds7916

(2,972,793) (14,664) - T ransfers Out (Use)8911 - (590,396,103) - Payment to Bond Refunding Escrow Agent (Use)8940

Total Other Financing Sources (Uses) 7080 (2,812,608) 5,387,920 1,809,392

1200 Net Change in Fund Balances 981,717 2,934,463 (148,679,856)

0100 Fund Balance - July 1 (Beginning) 114,118,514 94,347,797 246,974,168

3000 Fund Balance - June 30 (Ending) $ 115,100,231 $ 97,282,260 $ 98,294,312

30


EXHIBIT C-3

Other

Funds Funds

Governmental

Total

466,933,518 20,214,998 $ $

190,300,039 9,041,880

55,653,976 46,775,001

76,031,879 712,887,533

346,902,321 32,537,711

8,621,119 24,458

16,902,450 3,747,903

6,890,101 1,051,684

34,142,116 107,498

20,081,912 1,812,845

4,100,889 1,659,525

7,583,670 111,893

18,022,734 69,849

30,972,062 30,930,936

11,003,133 65,151

11,431,047 149,022

53,096,804 1,864,348

4,781,741 127,371

4,520,579 -

514,023 332,527

52,580,000 -

60,576,951 -

13,850,766 -

151,300,370 99,102

406,752 -

78,657 -

2,335,660 -

74,691,823 860,695,857

1,340,056 (147,808,324)

533,930,000 -

10,964 10,964

3,670,177 600

60,168,687 -

(3,182,583)(195,126)

(590,396,103) -

(183,562) 4,201,142

1,156,494 (143,607,182)

12,191,400 467,631,879

$ 13,347,894 $ 324,024,697

31


RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES,AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES


(143,607,182)$Total Net Change in Fund Balances - Governmental Funds

5,437,040 The District uses internal service funds to charge the costs of certain activities, such as self-insurance and printing, to appropriate functions in other funds. The net income (loss) of internal service funds are reported with governmental activities. The net effect of this consolidation is to increase net position.

125,784,325 Current year capital outlays and long-term debt principal payments are expenditures in the fund financial statements, but they should be shown as increases in capital assets and reductions in long-term debt in the government-wide financial statements. The net effectof including the 2015 capital outlays and debt principal payments is to increase net position. Also included in items related to debt is the recognition of the District's proportionate share of the net pension liability required by GASB 68, a Deferred Resource Inflow related to TRS, and a Deferred Resource Outflow related to TRS. This led to an increase in net position.

(57,377,623)Depreciation is not recognized as an expense in governmental funds since it does not require the use of current financial resources. The net effect of the current year's depreciation is to decrease net position.

248,843 Various other reclassifications and eliminations are necessary to convert from the modified accrual basis of accounting to accrual basis of accounting. These include recognizing unavailable revenue from property taxes as revenue, adjusting current year revenue to show the revenue earned from the current year's tax levy, eliminating interfund transactions, reclassifying the proceeds of bond sales, and recognizing the liabilities associated with maturing long-term debt and interest. The net effect of these reclassifications and recognitions is to increase net position.

(86,424,053)A prior period adjustment related to the beginning TRS pension liability decreased net position.

16,909,456 $ Change in Net Position of Governmental Activities

32



STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL - GENERAL FUND


Control

Data

CodesOriginal Final

(GAAP BASIS)

(Negative)

Positive or

Final BudgetVariance WithActual Amounts

Budgeted Amounts

REVENUES:322,494,220 320,780,391 323,560,117 1,065,897 Local and Intermediate Sources $ $ $ $5700

182,598,007 183,476,336 181,054,370 (1,543,637)State Program Revenues5800

7,161,481 7,180,275 7,048,002 (113,479)Federal Program Revenues5900

Total Revenues5020 511,437,002 512,253,708 511,662,489 (591,219)

EXPENDITURES:

Current:325,467,505 322,819,149 314,364,610 11,102,895 Instruction0011

8,958,517 8,709,508 8,596,661 361,856 Instructional Resources and Media Services0012

13,807,651 13,607,173 13,154,547 653,104 Curriculum and Instructional Staff Development0013

6,018,114 5,977,376 5,838,417 179,697 Instructional Leadership0021

34,779,329 34,263,843 34,034,618 744,711 School Leadership0023

19,324,482 19,430,639 18,269,067 1,055,415 Guidance, Counseling and Evaluation Services0031

2,518,374 2,501,799 2,441,364 77,010 Social Work Services0032

7,716,727 7,942,156 7,471,777 244,950 Health Services0033

18,914,271 18,416,810 17,952,885 961,386 Student Transportation0034

50,840 3,677 41,126 9,714 Food Services0035

11,060,298 10,262,640 10,937,982 122,316 Extracurricular Activities0036

11,960,277 12,669,445 11,282,025 678,252 General Administration0041

53,587,614 55,521,757 51,232,456 2,355,158 Facilities Maintenance and Operations0051

4,787,574 4,900,601 4,654,370 133,204 Security and Monitoring Services0052

4,636,728 4,215,446 4,520,579 116,149 Data Processing Services0053

221,542 288,858 181,496 40,046 Community Services0061

Capital Outlay:102,100 - 73,115 28,985 Facilities Acquisition and Construction0081

Intergovernmental:568,168 400,000 406,752 161,416 Instructional Shared Service Arrangements0093

123,069 412,069 78,657 44,412 Juvenile Justice Alternative Education Program0095

2,392,915 2,348,915 2,335,660 57,255 Property Tax Appraisal0099

Total Expenditures6030 524,691,861 526,996,095 507,868,164 19,127,931


(13,254,859) (14,742,387) 3,794,325 18,536,712

OTHER FINANCING SOURCES (USES): 636,512 636,512 160,185 (476,327)Transfers In7915

(3,097,843)(2,818,000) (2,972,793) 125,050 Transfers Out (Use)8911

Total Other Financing Sources (Uses) 7080 (2,181,488) (2,461,331) (2,812,608) (351,277)

1200 Net Change in Fund Balances (15,436,347) (17,203,718) 981,717 18,185,435

0100 Fund Balance - July 1 (Beginning) 114,118,514 114,118,514 114,118,514 -

3000 Fund Balance - June 30 (Ending) $ 98,682,167 $ 96,914,796 $ 115,100,231 $ 18,185,435

33


EXHIBIT D-1NORTH EAST INDEPENDENT SCHOOL DISTRICT

STATEMENT OF NET POSITIONPROPRIETARY FUNDS

JUNE 30, 2015

Total

Enterprise

Funds Service Funds

Internal

Total

Governmental

Activities -

Business-Type

Activities -

ASSETSCurrent Assets:

19,387,244 5,218,504 Cash and Cash Equivalents $ $6,963,770 - Investments - Current

338 - Due from Other Governments37,860 - Accrued Interest

9,881,194 248,140 Due from Other Funds339,691 113,068 Other Receivables921,729 - Inventories

5,579,712 37,531,826 Total Current Assets

Noncurrent Assets:Capital Assets:

- 2,547,600 Land483,379 10,325,760 Buildings and Improvements

(373,207)(3,751,357)Depreciation on Buildings

18,506,131 525,893 Furniture and Equipment(10,173,312)(292,605)Depreciation on Furniture and Equipment

9,355,291 8,442,991 Total Noncurrent Assets

Total Assets 14,935,003 45,974,817

LIABILITIESCurrent Liabilities:

356,646 42,921 Accounts Payable300,000 - Short Term Workers Compensation Payable16,189 90,733 Accrued Wages Payable

2,534,856 964,911 Due to Other Funds187 7,396 Due to Other Governments

- 13,970 Due to Student Groups4,292,789 - Accrued Expenses

- 81,085 Unearned Revenues

1,201,016 7,500,667 Total Current Liabilities

Noncurrent Liabilities:756,111 - Workers Compensation - Due in More than One Year

- 756,111 Total Noncurrent Liabilities

Total Liabilities 1,201,016 8,256,778

NET POSITION8,442,991 9,355,291 Net Investment in Capital Assets

29,275,048 4,378,696 Unrestricted Net Position

Total Net Position 13,733,987 37,718,039 $ $

34


EXHIBIT D-2NORTH EAST INDEPENDENT SCHOOL DISTRICT

STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITIONPROPRIETARY FUNDS


Total

Enterprise

Funds Service Funds

Internal

Total

Business-Type

Activities -

Governmental

Activities -

OPERATING REVENUES:

79,140,851 10,206,045 Local and Intermediate Sources $ $751,233 422,398 State Program Revenues966,754 - Federal Revenues

Total Operating Revenues 10,628,443 80,858,838

OPERATING EXPENSES:

11,421,481 7,627,649 Payroll Costs5,081,684 890,214 Professional and Contracted Services2,216,740 596,544 Supplies and Materials

56,309,164 671,120 Other Operating Costs1,884,985 477,814 Depreciation Expense

Total Operating Expenses 10,263,341 76,914,054

Operating Income 365,102 3,944,784

NONOPERATING REVENUES (EXPENSES):

1,022 128,218 Gain in Sale of Real and Personal Property27,431 - Earnings from Temporary Deposits & Investments(9,197) - (Loss) on Sale of Real and Personal Property

- (6,459)Non-operating Expenses

Total Nonoperating Revenues (Expenses) 121,759 19,256

Income Before Transfers 486,861 3,964,040

1,473,000 - Transfer In - (1,960,594)Transfers Out


Total Net Position - July 1 (Beginning)

Total Net Position - June 30 (Ending)

(1,473,733)

15,207,720

$ 13,733,987

5,437,040

32,280,999

$ 37,718,039

35


EXHIBIT D-3 (Cont'd)NORTH EAST INDEPENDENT SCHOOL DISTRICTSTATEMENT OF CASH FLOWS

FOR THE YEAR ENDED JUNE 30, 2015PROPRIETARY FUNDS

Total Total

Enterprise Internal

Funds Service Funds

Governmental

Activities -

Business-Type

Activities

Cash Flows from Operating Activities:78,642,063 10,366,675 Cash Received from User Charges $ $

(10,665,849)(7,233,766)Cash Payments to Employees for Services(55,120,427) - Cash Payments for Insurance Claims(8,959,622)(2,141,975)Cash Payments to Suppliers

(705,283) - Cash Payments for Other Operating Expenses(3,808,054)74,255 Cash Payments to Other Funds - Operating Expenses

1,065,189 Net Cash Provided by (Used for) Operating

(617,172)Activities

Cash Flows from Non-Capital Financing Activities: - (1,960,594)Transfers Out

1,473,000 - Transfers In - 128,218 Gain - Sale on Real Property Noncapital

(1,832,376)Net Cash Provided by (Used for) Non-Capital

1,473,000 Financing Activities

Cash Flows from Capital & Related Financing Activities:(1,326,165)(458,728)Acquisition of Capital Assets

- (6,459)Nonoperating Expenses1,103 - Gain on Sale of Capital Assets

(465,187)Net Cash Provided by (Used for) Capital &

(1,325,062)Related Financing Activities

Cash Flows from Investing Activities:

(5,485,000) - Purchase of Investment Securities3,989,486 - Proceeds from Sale & Maturities of Securities

35,065 - Interest and Dividends on Investments

- Net Cash Provided by (Used for) Investing

(1,460,449)Activities

Net Decrease in Cash and Cash Equivalents (1,232,374) (1,929,683)

Cash and Cash Equivalents at Beginning of Year 6,450,878 21,316,927

Cash and Cash Equivalents at End of Year 5,218,504 19,387,244 $ $


EXHIBIT D-3NORTH EAST INDEPENDENT SCHOOL DISTRICTSTATEMENT OF CASH FLOWS

FOR THE YEAR ENDED JUNE 30, 2015PROPRIETARY FUNDS

Total Total

Enterprise Internal

Funds Service Funds

Governmental

Activities -

Business-Type

Activities

Operating Income: $ $

Reconciliation of Operating Income to Net Cash

Provided by (Used for) Operating Activities:365,102 3,944,784

to Net Cash Provided by (Used For) Operating Activities:Adjustments to Reconcile Operating Income

1,884,985 477,813 Depreciation

Assets and Liabilities:Effect of Increases and Decreases in Current

(243,822)42,420 Decrease (increase) in Receivables131,155 - Decrease (increase) in Inventories

(2,029,312)(234,301)Decrease (increase) in Due From Other Funds

(902,692)15,902 Increase (decrease) in Accounts Payable131 37,267 Increase (decrease) in Due to Other Governments

4,399 (28,245)Increase (decrease) in Accrued Wages Payable1,252,194 366,439 Increase (decrease) in Due to Other Funds

(4,548,078)22,792 Increase (decrease) in Unearned Revenues12,789 - Increase (decrease) in Accrued Expenses

(123,705) - Increase (decrease) in Workers Comp PayableNet Cash Provided by (Used for)

(617,172)Operating Activities 1,065,189 $ $


EXHIBIT E-1NORTH EAST INDEPENDENT SCHOOL DISTRICT

STATEMENT OF FIDUCIARY NET POSITIONFIDUCIARY FUNDS

JUNE 30, 2015

Private

Purpose

Trust Fund Funds

Agency

ASSETS

2,131,915 274,589 Cash and Cash Equivalents $ $

178,528 3,000 Due from Other Funds

110 - Other Receivables

Total Assets 277,589 2,310,553 $

LIABILITIES

59,373 - Accounts Payable $

26,523 - Due to Other Funds

2,224,657 - Due to Student Groups

Total Liabilities - 2,310,553 $

NET POSITION

277,589 Unrestricted Net Position

Total Net Position 277,589 $

38


EXHIBIT E-2NORTH EAST INDEPENDENT SCHOOL DISTRICT

STATEMENT OF CHANGES IN FIDUCIARY FUND NET POSITIONFIDUCIARY FUNDS


Private

Purpose

Trust Fund

ADDITIONS:

71,428 Local and Intermediate Sources $

Total Additions 71,428

DEDUCTIONS:

49,482 Other Operating Costs

Total Deductions 49,482




21,946

255,643

$ 277,589

39


40



Notes to the Financial Statements


41

I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES North East Independent School District (the District) is a public educational agency operating under the applicable laws and regulations of the State of Texas. It is governed by a seven member Board of Trustees (the Board) elected by registered voters of the District. The District prepares its basic financial statements in conformity with generally accepted accounting principles (GAAP) promulgated by the Governmental Accounting Standards Board (GASB) and other authoritative sources identified in GASB Statement No. 56, and it complies with the requirements of the appropriate version of Texas Education Agency's Financial Accountability System Resource Guide (FASRG) and the requirements of contracts and grants of agencies from which it receives funds. A. REPORTING ENTITY The Board has governance responsibilities over all activities related to public elementary and secondary education within the jurisdiction of the District. The Board is elected by the public, has the authority to make decisions, appoint administrators and managers, significantly influence operations, and has primary accountability for fiscal matters. As such, the District is not included in any other governmental “reporting entity” as defined by GASB Statement No. 14, The Financial Reporting Entity. There are no component units included within the reporting entity. The District receives funding from local, state, and federal government sources and must comply with the requirements of these funding source entities. B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS The Statement of Net Position and the Statement of Activities are government-wide financial statements. They report information on all of the District’s nonfiduciary activities with most of the interfund activities removed. Governmental activities include programs supported primarily by taxes, state foundation funds, grants and other intergovernmental revenues. Business-type activities include operations funded mainly by fees and charges to third parties. The Statement of Activities demonstrates how other people or entities that participate in programs the District operates have shared in the payment of the direct costs. Direct costs are identifiable with a specific function. Program revenues of the District include charges for services and operating grants and contributions. Charges for services consist of charges to customers or applicants that purchase, use, or directly benefit from goods or services provided by a given function or segment of the District. Examples include tuition paid by students not residing in the District, school lunch charges, etc. Operating grants and contributions include amounts paid by organizations outside the District to help meet the operational or capital requirements of a given function. Examples include grants under the Elementary and Secondary Education Act. If revenue is not a program revenue, it is a general revenue used to support all of the District's functions. Taxes are considered general revenues.




42

B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (continued) During the course of operations the government has activity between funds for various purposes. Any residual balances outstanding at year end are reported as due from/to other funds and advances to/from other funds. While these balances are reported in fund financial statements, certain eliminations are made in the preparation of the government-wide financial statements. Balances between the funds included in governmental activities (i.e., the governmental and internal service funds) are eliminated so that only the net amount is included as internal balances in the governmental activities column. Similarly, balances between the funds included in business-type activities (i.e., the enterprise funds) are eliminated so that only the net amount is included as internal balances in the business-type activities column. The fund financial statements report the financial condition and results of operations for three fund categories - governmental, proprietary, and fiduciary. Since the resources in the fiduciary funds cannot be used for District operations, they are not included in the government-wide statements. The District considers some governmental funds major and reports their financial condition and results of operations in a separate column. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. All other revenues and expenses are nonoperating. C. MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL

STATEMENT PRESENTATION The government-wide financial statements use the economic resources measurement focus and the accrual basis of accounting, as do the proprietary fund and fiduciary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of the related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements use the current financial resources measurement focus and the modified accrual basis of accounting. With this measurement focus, only current assets, current liabilities and fund balances are included on the balance sheet. Operating statements of these funds present net increases and decreases in current assets (i.e., revenues and other financing sources and expenditures and other financing uses).




43

C. MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT PRESENTATION (continued)

The modified accrual basis of accounting recognizes revenues in the accounting period in which they become both measurable and available, and it recognizes expenditures in the accounting period in which the fund liability is incurred, if measurable, except for unmatured interest and principal on long-term debt, which is recognized when due. The expenditures related to certain compensated absences and claims and judgments are recognized when the obligations are expected to be liquidated with expendable available financial resources. The District considers all revenues available if they are collectible within 60 days after year end. Revenues from local sources consist primarily of property taxes. Property tax revenues and revenues received from the State are recognized under the susceptible-to-accrual concept. Miscellaneous revenues are recorded as revenue when received in cash because they are generally not measurable until actually received. Investment earnings are recorded as earned, since they are both measurable and available. Grant fund revenues are considered to be earned to the extent of expenditures made under the provisions of the grant. Accordingly, when such funds are received, they are recorded as deferred revenues until related and authorized expenditures have been made. If balances have not been expended by the end of the project period, grantors sometimes require the District to refund all or part of the unused amount. Permanent funds report resources that are restricted to the extent that only earnings and not principal may be used for purposes that support the District or its students. The Proprietary Funds are accounted for on a flow of economic resources measurement focus and utilize the accrual basis of accounting. This basis of accounting recognizes revenues in the accounting period in which they are earned and become measurable and expenses in the accounting period in which they are incurred and become measurable. With this measurement focus, all assets and all liabilities associated with the operation of these funds are included on the Statement of Net Position. The total net position is segregated into net investment in capital assets, restricted net position, and unrestricted net position. Agency Funds utilize the accrual basis of accounting but do not have a measurement focus as they report only assets and liabilities.




44


The District’s accounts are organized on the basis of funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for by providing a separate set of self-balancing accounts which are comprised of each fund’s assets, liabilities, equity, revenues, and expenditures or expenses. The District reports the following major governmental funds:

General Fund – The General Fund is used to account for financial resources used for

general operations. It is the basic fund of the school system and covers all activities for which a special fund has not been established. Any fund balances are considered resources available for current operations. All general tax revenues and other receipts not allocated by law or contractual agreement to some other fund are accounted for in this fund.

Debt Service Fund – This fund is used to account for the payment of principal and

interest on long-term general obligation debt of the District. Local property taxes are the main source of revenue for this fund.

Capital Projects Fund – The proceeds from long-term debt financing and revenues

and expenditures related to authorized construction and other capital asset acquisitions are accounted for in a capital projects fund.

Additionally, the District reports the following fund type(s): Governmental Funds:

Special Revenue Funds – These funds are used to account for resources restricted to, or committed for, specific purposes by a grantor. Federal and state financial assistance generally is accounted for in a special revenue fund. Generally, unused balances are returned to the grantor at the close of specified project periods.

Permanent Fund – This fund is used to account for donations received to fund

scholarships for the District’s students. The principal received is invested and the earnings are used to provide scholarships.




45


Proprietary Funds:

Enterprise Funds – These funds are used to account for operations financed and operated in a manner similar to private business enterprises, where the intent is that costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. The District's non-major Enterprise Funds are:

Property Management Uniform Rentals Community Education Preschool Program for Children with Disabilities North East Aquatics and Tennis Internal Service Funds – These funds are conceived to be self-supporting. Revenues

are earned mainly from sales of services to the schools and operating departments of the District. The District's Internal Service Funds are:

Document Management & Printing Services Health Insurance Data Processing Center Network Technology Services Dental Insurance Workers’ Compensation Insurance Rolling Owner Controlled Insurance Program Unemployment Compensation Insurance Police Services

Fiduciary Funds:

Private-Purpose Trust Funds – The District utilized these funds to report resources held in trust for others where the principal and interest benefit the District or its students where the principal and earnings may be used.

Scholarships

Agency Funds – The District accounts for resources held for others in a custodial capacity in agency funds. The District's Agency Funds are:

Student Activity Central Office




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D. OTHER ACCOUNTING POLICIES

1. Cash and cash equivalents include cash and highly liquid investments such as certificates of deposits, money market funds, local government investment pools, Treasury bills, and commercial paper that have a maturity from time of purchase of three months or less. (See Note IV A for more details.)

2. Inventories of supplies on the balance sheet are carried at cost, which is determined

principally by the average cost method, while inventories of food commodities are recorded at fair values supplied by the United States Department of Agriculture (USDA). Inventories are considered expenditures or expenses as they are consumed. Supplies are used for almost all functions of activity, while food commodities are used only in the food service program. Although commodities are received at no cost, their fair value is supplied by the USDA and recorded as inventory and deferred revenue when received. When requisitioned, inventory and deferred revenue are relieved, expenditures are charged, and revenue is recognized for an equal amount.

3. In the government-wide financial statements and for proprietary fund types in the

fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight line interest method. Bonds payable are reported net of the applicable unamortized bond premium or discount. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.

4. The District’s policies provide for accumulation of vacation time for certain hourly

employees provided it is taken prior to the calendar year-end. The accumulated vacation payable at June 30, 2015 and 2014 was $815,751 and $901,408, respectively.

The policies also provide for accumulation of State personal and sick leave, which includes salary-related payments, that are payable upon resignation for employees having served the District for ten consecutive years and who are eligible to receive benefits under the Texas Teacher Retirement System. (See Note IV G for more details.)




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D. OTHER ACCOUNTING POLICIES (continued)

5. Capital assets, which include land, buildings, furniture and equipment, and intangible assets, are reported in the applicable columns in the government-wide financial statements. Capital assets are defined by the District as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair value at the date of donation. (See Note IV E for more details.)

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets' lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Intangible assets consist of internally generated software and commercially available software that required modification prior to being put into service by the District. Intangible assets are reported in the furniture and equipment category in the financial statements and footnotes. Amortization is reported along with depreciation expense in the financial statements and in the footnotes. Buildings, furniture and equipment of the District are depreciated/amortized using the straight line method over the following estimated useful lives:

Assets Years Buildings and Improvements 10-30 Furniture and Equipment 3-10 Software 3-10

6. Bond proceeds not spent are restricted for purposes approved by the voters in the

District’s bond election and include the following: construction, technology improvements, bus purchases and library improvements.

7. The District is self-funded in four areas which include the following:

Health Insurance Dental Insurance Workers’ Compensation Insurance Unemployment Compensation Insurance




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D. OTHER ACCOUNTING POLICIES (continued) 8. In the fund financial statements, governmental funds report fund balance as

nonspendable if the amounts cannot be spent because they are either not in spendable form or are legally or contractually required to remain intact. Restrictions of fund balance are for amounts that are restricted to specific purposes by an external entity (creditors, grantors, governmental regulations) or the restriction is imposed by law through constitutional provision or enabling legislation. Commitments of fund balance represent amounts that can only be used for specific purposes pursuant to constraints imposed by the District’s Board. Assignments of fund balance are amounts set aside by the District’s Superintendent or his designee with the intent they be used for specific purposes.

9. When the District incurs an expense for which it may use either restricted or

unrestricted assets, it uses the restricted assets first unless unrestricted assets will have to be returned because they were not used.

10. The Data Control Codes refer to the account code structure prescribed by the Texas

Education Agency (TEA) in the FASRG. TEA requires school districts to display these codes in the financial statements in order to insure accuracy in building a State-wide database for policy development and funding plans.

11. Investments are valued at fair value.

12. Certain payments to vendors reflect costs applicable to future accounting periods and

are recorded as prepaid items within the deferred expenditures (expenses) line item in both government-wide and fund financial statements.

13. School districts are required to report all expenses by function, except certain indirect

expenses. General administration and data processing service functions (data control codes 41 and 53, respectively) include expenses that are indirect expenses of other functions. These indirect expenses are not allocated to other functions.

14. The fiduciary net position of the Teacher Retirement System of Texas (TRS) has been

determined using the flow of economic resources measurement focus and full accrual basis of accounting. This includes for purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, pension expense, and information about assets, liabilities and additions to/deductions from TRS’s fiduciary net position. Benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments of the system are reported at fair value.




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15. In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/ expenditure) until then. The District has several items that qualify for reporting in this category. One is the deferred charge on refunding prior debt issuances reported in the government-wide statement of net position. A deferred charge on refunding results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The District has only one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from one sources: property taxes. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available.

16. Fund balance amounts that are restricted, committed, or assigned are considered to

have been spent when an expenditure is incurred for the purpose for which the fund balance was restricted, committed or assigned. If an expenditure is incurred that meets the criteria in more than one fund balance category, then the District considers that the fund balance is relieved in the following order: restricted, committed, assigned and then unassigned. Commitments of fund balance may only be established (and modified or rescinded) by a resolution of the Board. The commitment may only be relieved by incurring expenditures for that purpose or by resolution of the Board. Assignments of fund balance are established (and modified or rescinded) by the Superintendent or his designee and may only be relieved by incurring expenditures for that purpose or as authorized by the Superintendent.

17. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from these estimates.




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18. Certain amounts have been reclassified from prior presentations at June 30, 2014 to conform to classifications at June 30, 2015. There is no effect on previously reported change in net position

E. CHANGE IN ACCOUNTING POLICY During fiscal year 2015, the District changed accounting policies related to reporting of net pension liability, deferred outflows of resources, and deferred inflows of resources in a statement of net financial position by adopting GASB Statement No. 68 “Accounting and Financial Reporting for Pensions – an Amendment of GASB Statement No. 27.” Accordingly, the effect of the accounting change is reported on the statement of net position, and the statement of activities for the current year. II. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL

STATEMENTS A. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE

GOVERNMENTAL FUNDS BALANCE SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET POSITION Exhibit C-2 provides the reconciliation between the fund balance for total governmental funds on the Governmental Fund Balance Sheet and the net position for governmental activities as reported in the government-wide Statement of Net Position. One element of that reconciliation explains that capital assets are not financial resources and are therefore not reported in governmental funds. In addition, long-term liabilities, including bonds payable, are not due and payable in the current period and are not reported as liabilities in the funds. The details of capital assets and long-term debt (excluding internal service fund activity) at the beginning of the year are on the following page:




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A. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUNDS BALANCE SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET POSITION (continued)

Capital Assets at the Beginning of the Year Historic Cost

Accumulated Depreciation/Amortization

Net Value at the Beginning

of the YearChange in Net

Position

Land $ 92,288,143 $ - $ 92,288,143 Buildings and Improvements 1,580,610,932 517,793,632 1,062,817,300 Furniture and Equipment 49,892,592 32,274,058 17,618,534 Construction in Progress 112,396,136 - 112,396,136

Capital Assets Total $ 1,835,187,803 $ 550,067,690 $ 1,285,120,113 $ 1,285,120,113

Accrued Liabilities at the Beginning of the Year

Payable at the Beginning of

the Year

Bonds Payable $ 1,616,319,231 Interest Payable 24,042,589 Vacation Payable 901,408 Compensated Absences 3,665,342 OPEB Net Obligation/(Benefit) 184,224 Deferred Charge for Loss on

Refunding Debt Issuance (26,262,716) Change in Net Assets $ 1,618,850,078 (1,618,850,078)

Net Adjustment to Net Position $ (333,729,965)




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B. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE

GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES AND THE GOVERNMENT-WIDE STATEMENT OF ACTIVITIES

Exhibit C-4 provides a reconciliation between the net changes in fund balance as shown on the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances and the changes in net position of governmental activities as reported on the government-wide Statement of Activities. One element of that reconciliation explains that current year capital outlays and debt principal payments are expenditures in the fund financial statements but should be shown as increases in capital assets and decreases in long-term debt in the government-wide statements. This adjustment affects both the net position balance and the change in net position. The details of this adjustment, excluding internal service fund activity, are as follows:

Changes in Capital Assets Amount

Adjustments to Changes in Net

AssetsAdjustments to

Net Position

Land $ 2,052,109 $ 364,130 Buildings and Improvements 4,204,908 68,459,798 Furniture and Equipment 4,242,125 - Construction in Progress 124,276,990 (68,823,928)Total Capital Outlay $ 134,776,132 $ - $ 134,776,132

Debt Payments

Bond Principal $ 52,580,000 Accretion on Capital Appreciation Bonds (493,076)Change in Bond Interest Payable 2,635,930 Premiums on Bond Issuance (60,168,687)Net Change Due to Bond

Issuance/Refunding 56,466,103 Amortization of Premiums and

Loss on Refunding 21,536,244 Change in vacation payable, compensated .

absences payable, & OPEB liability (192,520)Change in TRS Pension liability (75,237,231)Change in Deferred Inflow/Outflow for TRS (6,118,570)Total Debt Payments $ (8,991,807) - (8,991,807)Total Adjustment to Net Position $ - $ 125,784,325




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III. STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY A. BUDGETARY DATA The official budget was prepared for adoption for the General Fund, Debt Service Fund, and the National Breakfast and Lunch Program Fund, which is included within the Nonmajor Governmental Funds. The budget is prepared using the modified accrual basis of accounting. The following procedures are used in establishing the budgetary data reflected in the basic financial statements: a. Prior to June 20, the District prepares a budget for the next fiscal year beginning July 1.

The operating budget includes proposed expenditures and the means of financing them. b. A meeting of the Board is called for the purpose of adopting the proposed budget. Public

notice of the meeting must be given ten days prior to the actual meeting. c. Prior to July 1, the budget is legally enacted through passage of a resolution by the Board. Once a budget is approved, it can be amended at the fund level by approval of a majority of the members of the Board. The Board has authorized the administration through resolution to provide budgetary control at the functional expenditure level. Funds may be transferred between functions without Board approval when there is no effect to the overall fund balance. The cumulative effect of such transfers is approved by the Board in a subsequent budget amendment. Budget amendments are included on the Board agenda periodically throughout the fiscal year. Each amendment must have Board approval. All amendments are reflected in the official minutes of the Board and are made prior to fiscal year-end as required by law. Each budget is controlled by the budget manager at the revenue and expenditure function/object level. The budget should not be exceeded at the function level which is the line-item level shown in the basic financial statements. Budgeted amounts are as amended by the Board. All budget appropriations lapse at year-end even if they have related encumbrances. Encumbrances are commitments to purchase goods or services that were not fully executed at year-end. Encumbrance accounting is utilized to ensure effective budgetary control and accountability. While encumbrances lapse at year end, valid outstanding encumbrances (those whose terms will be completed in the next year) are re-appropriated and become part of the subsequent year’s budget.




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A. BUDGETARY DATA (continued)

Original Budget

AppropriationIncrease

(Decrease)

Amended Budget

Appropriation

General Fund $ 524,691,861 $ 2,304,234 $ 526,996,095National Breakfast and Lunch Program Fund 35,039,535 (478,000) 34,561,535Debt Service Fund 111,066,096 16,681,905 127,748,001

$ 670,797,492 $ 18,508,139 $ 689,305,631

A reconciliation of fund balances for both appropriated budget and non-appropriated budget Nonmajor Governmental Funds at June 30, 2015 is as follows:

FundBalance

Appropriated Budget Fund National Breakfast and Lunch Program Fund $ 9,227,185

Non-appropriated Budget Funds 4,120,709

All Nonmajor Governmental Funds $ 13,347,894

IV. DETAILED NOTES ON ALL FUNDS A. DEPOSITS AND INVESTMENTS The District’s funds are required to be deposited under the terms of a depository contract or invested under the terms of the Public Funds Investment Act (PFIA). The depository bank places for safekeeping and trust with the District’s agent bank approved pledged securities in an amount sufficient to protect District funds on a day-to-day basis during the period of the contract. The pledge of approved securities is waived only to the extent of the depository bank’s dollar amount of Federal Deposit Insurance Corporation (FDIC) insurance.




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A. DEPOSITS AND INVESTMENTS (continued) Deposits and investments at June 30, 2015 are as follows:

Cash in Bank or on hand - Primary Government $ 12,601,934Cash Equivalents

Money Market accounts:LOGIC 59,095,099TexPool Prime 82,224,261LoneStar 17,119,657TexPool 12,330,173Fidelity 104,685

Total Cash and Cash Equivalents $ 183,475,809

Investments 209,086,203

Total Deposits and Investments - Primary Government $ 392,562,012

The District utilizes imprest accounts where funds are automatically transferred from a cash management account whenever checks are presented. The cash account balance will occasionally reflect a negative balance as a result of the complexity and timing of various banking transactions. Deposits At June 30, 2015, the carrying amount of the District’s deposits was $12,601,071. The District’s cash deposits at June 30, 2015 were fully covered by FDIC insurance or by pledged collateral held by the District’s agent bank or in the District’s name. The District bid for a depository services contract for a term of two years beginning July 1, 2015 and ending June 30, 2017. Wells Fargo was awarded the contract, therefore funds were transferred to Wells Fargo accounts on June 25th and 30th, to test the new account and fund a July 2, 2015 payroll. At June 30, 2015, the bank balance at Bank of America was $10,736,007, and the balance at Wells Fargo was $5,000,196.




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A. DEPOSITS AND INVESTMENTS (continued) In addition, the following is disclosed regarding coverage of combined balances on the date of the highest deposit: a. Depository: Bank of America, N.A.; San Antonio, Texas (funded the entire fiscal year;

July 1, 2014 - June 30,2015); Wells Fargo Bank, N.A.; Austin, Texas (funded June 25, 2015)

b. The highest combined balances of cash, savings, and time deposit accounts at Bank of

America amounted to $9,007,006 and occurred during April 2015. The highest balance at Wells Fargo occurred on June 30th at $5,000,196.

c. The District’s balances were collateralized for all amounts on deposit above the $250,000

FDIC insurance. Investments The District is required by the Public Funds Investment Act, Chapter 2256, Texas Government Code (PFIA), to adopt and implement an investment policy. That policy must address the following areas: safety of principal and liquidity, portfolio diversification, allowable investments, acceptable risk levels, expected rates of return, maximum allowable stated maturity of portfolio investments, maximum average dollar-weighted maturity allowed based on the stated maturity date for the portfolio, investment staff quality and capabilities, and bid solicitation preferences for certificates of deposit. Statutes authorize the District to invest in obligations of the U.S. Treasury, certain U.S. agencies and the State of Texas, certificates of deposit, certain municipal securities, and money market guaranteed investment contracts. The PFIA also requires the District to have independent auditors perform test procedures related to investment practices as provided by the PFIA. The District is in substantial compliance with the requirements of the PFIA and with local policies. The investment pools used by the District are organized under the authority of the Interlocal Cooperation Act, Chapter 791, Texas Government Code, and the Public Funds Investment Act, Chapter 2256, Texas Government Code. The investment pools are public funds investment pools created to provide a safe environment for the placement of local government funds in authorized short-term investments. The investment pools operate in a manner consistent with the Security and Exchange Commission’s Rule 2a7 of the Investment Company Act of 1940. The District’s investments in investment pools, which are exempt from regulation by the Securities and Exchange Commission, have as one of their objectives the maintenance of a stable net asset value of $1.00. The book value of the position in the pools is the same as the number of the shares in each pool; the market value of a share should approximately equal the book value of a share.




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A. DEPOSITS AND INVESTMENTS (continued)

Investments (continued) Credit Risk. In accordance with state law and the District’s investment policy, investments in mutual funds and investment pools must be rated at least AAA or have an equivalent rating, commercial paper must be rated at least A-1 by Standard & Poors (S&P), P-1 by Moody’s Investment Services, or have an equivalent rating, and obligations of states, agencies, counties, and cities must be rated at least A or its equivalent. As of June 30, 2015, the District’s investments in investment pools met or exceeded the ratings criteria and were rated AAA by S&P. S&P has rated the long-term sovereign credit rating on the United States of America AA+. As a result, the long-term issuer credit ratings and related issue ratings on select government-related entities are also rated AA+. S&P affirmed the short-term issue ratings for these entities at A-1+. These entities are still rated Aaa and AAA by Moody’s and Fitch rating agencies. S&P had formerly issued a credit rating of AAA for the United States of America and on the related governmental entities. Although the credit ratings were lowered on government-related issues held by the District, they remain compliant with the District’s investment policy. Concentration of Credit Risk. The District places no limit on the amount the District may invest in any one issuer, rather investments are governed by the objectives of preservation and safety of principal, liquidity, and yield. In addition, the investment portfolio is diversified in terms of investment instruments, maturity scheduling, and financial institutions to reduce risk of loss resulting from over-concentration of assets in a specific class of investments, specific maturity, or specific issuer. More than 5% of the District’s investments are in agency securities issued by the Federal National Mortgage Association (5.50%). Interest Rate Risk. In accordance with State law and the District’s investment policies, the District does not purchase any investments with maturities greater than five (5) years unless the investment’s maturity is matched to cash flow needs of long-term liabilities. The investment maturities in the following table reflect the maturity date of the investments in each category. Some investments are callable (redeemable) by the issuer on specified dates prior to the stated maturity date. The District uses its investments in the investment pools to further mitigate interest rate risk. The District’s investments at June 30, 2015 are shown in the table on the following page:




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A. DEPOSITS AND INVESTMENTS (continued)

Investment Type Fair Value Less than 1 1 to 2 2 to 4 10+U.S. Agencies $ 61,532,490 $ 41,431,825 $ 18,098,145 $ 2,002,520 $ - Municipal Bonds/Notes 70,869,644 53,269,800 15,810,596 1,789,248Commercial Paper 74,999,069 74,999,069 - - - Certificates of Deposit 1,685,000 1,685,000 - - - Investment Pools 170,873,875 - - - Total Fair Value $ 379,960,077 $ 171,385,694 $ 33,908,741 $ 2,002,520 $ 1,789,248

Investment Maturities in Years

B. PROPERTY TAXES Property taxes are levied by October 1 on the assessed value listed as of the prior January 1st for all real and business personal property located in the District in conformity with Subtitle E, Texas Property Tax Code. Taxes are due on receipt of the tax bill and are delinquent if not paid before February 1st of the year following the year in which imposed. On January 1st of each year, a tax lien attaches to property to secure the payment of all taxes, penalties, and interest ultimately imposed. The delinquency and lien provisions do not apply to certain taxpayers that elect and follow a split-payment option and to qualified taxpayers over 65 years old or disabled that elect and follow a 4-payment option. C. DELINQUENT TAXES RECEIVABLE Delinquent taxes are prorated between maintenance (General Fund) and debt service based on rates adopted for the year of the levy. Allowances for uncollectible taxes receivable within the General and Debt Service Funds are based on historical experience in collecting property taxes. Uncollectible personal property taxes are periodically reviewed and written off, but the District is prohibited from writing off real property taxes without specific statutory authority from the Texas Legislature.




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D. INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS The composition of interfund balances as of June 30, 2015 is as follows:

Receivable Fund Payable Fund AmountGeneral Fund Nonmajor Governmental Funds $ 6,207,752General Fund Capital Projects Funds 13,912,088General Fund Enterprise Funds 944,313General Fund Internal Service Funds 2,503,068General Fund Debt Service Fund 10General Fund Fiduciary Funds 25,575Debt Service Fund General Fund 6,435,449Capital Projects Funds General Fund 166,718Nonmajor Governmental Funds General Fund 1,734,080Nonmajor Governmental Funds Nonmajor Governmental Funds 52,374Nonmajor Governmental Funds Enterprise Funds 3,369Internal Service Funds General Fund 7,041,736Internal Service Funds Capital Projects Funds 56,691Internal Service Funds Nonmajor Governmental Funds 2,732,802Internal Service Funds Enterprise Funds 17,229Internal Service Funds Internal Service Funds 31,788Internal Service Funds Fiduciary Fund 948Enterprise Funds General Fund 242,852Enterprise Funds Nonmajor Governmental Funds 5,288Fiduciary Fund General Fund 47,118Fiduciary Fund Nonmajor Governmental Funds 134,410

Total $ 42,295,658

The outstanding balances between funds result mainly from the time lag between the dates that (1) interfund goods and services are provided or reimbursable expenditures occur, (2) transactions are recorded in the accounting system, and (3) payments between funds are made. These amounts will all be collected within the subsequent year.




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D. INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS (continued) Interfund transfers are defined as “flow of assets without equivalent flows of assets in return and without requirement of repayment.” Interfund transfers for the year ending June 30, 2015 were as follows:

General Nonmajor DebtTransfers In Fund Governmental Enterprise Service Total

General Fund $ - $ 95,126 $ 65,059 $ - $ 160,185Capital Projects 279,193 100,000 1,415,535 14,664 1,809,392Nonmajor Governmental 600 - - - 600Internal Service 993,000 - 480,000 - 1,473,000Debt Service 1,700,000 - - - 1,700,000

Total Transfers $ 2,972,793 $ 195,126 $ 1,960,594 $ 14,664 $ 5,143,177

Transfers Out

Transfers are used to (1) move revenues/expenditures from the fund that statute or budget requires them to collect the revenues/expenditures to the fund that statute or budget requires to expend them; (2) move funds to the debt service fund as a voluntary accumulation of resources for principal payments that are not payable from tax revenues for the 2010 Qualified School Construction Bonds, and (3) use unrestricted revenues collected in the general fund to finance various programs accounted for in other funds in accordance with budgetary authorizations.




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E. CAPITAL ASSET ACTIVITY Capital asset activity for the District’s governmental activities, including internal service funds, for the year ended June 30, 2015, was as follows:

Completed Beginning Capital Ending

Balance Additions Projects Disposals Balance Nondepreciable Capital AssetsLand $ 92,288,143 $ 2,052,109 $ 364,130 $ - $ 94,704,382Construction in Progress 112,396,136 124,276,990 (68,823,928) - 167,849,198 Subtotal Nondepreciable Assets 204,684,279 126,329,099 (68,459,798) - 262,553,580

Depreciable/Amortizable Capital AssetsBuildings and Improvements 1,581,094,311 4,204,908 68,459,798 - 1,653,759,017Furniture and Equipment 67,782,974 5,568,293 - (1,480,274) 71,870,993 Subtotal Depreciable/

Amortizable Assets 1,648,877,285 9,773,201 68,459,798 (1,480,274) 1,725,630,010

Totals at Historical Cost 1,853,561,564 136,102,300 - (1,480,274) 1,988,183,590

Less Accumulated Depreciation/Amortization for:Buildings and Improvements (518,124,637) (53,211,273) - - (571,335,910)Furniture and Equipment (41,305,728) (6,051,335) - 1,452,071 (45,904,992)

Total Accumulated Depreciation/Amortization (559,430,365) (59,262,608) - 1,452,071 (617,240,902)

Governmental Activities Capital Assets, Net $ 1,294,131,199 $ 76,839,692 $ - $ (28,203) $ 1,370,942,688




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E. CAPITAL ASSET ACTIVITY (continued) Capital asset activity for the District’s business-type activities for the year ended June 30, 2015, was as follows:

Completed Beginning Capital Ending

Balance Additions Projects Disposals Balance Nondepreciable Capital AssetsLand $ 2,547,600 $ - $ - $ - $ 2,547,600Construction in Progress - - - - - Subtotal Nondepreciable Assets 2,547,600 - - - 2,547,600

Depreciable Capital AssetsBuildings and Improvements 9,928,181 397,579 - - 10,325,760Furniture and Equipment 464,345 61,548 - - 525,893 Subtotal Depreciable Assets 10,392,526 459,127 - - 10,851,653

Totals at Historical Cost 12,940,126 459,127 - - 13,399,253

Less Accumulated Depreciation for:Buildings and Improvements (3,354,013) (397,344) - - (3,751,357)Furniture and Equipment (212,135) (80,470) - - (292,605)

Total Accumulated Depreciation (3,566,148) (477,814) - - (4,043,962)

Business - Type Activities Capital Assets, Net $ 9,373,978 $ (18,687) $ - $ - $ 9,355,291




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E. CAPITAL ASSET ACTIVITY (continued) Depreciation and amortization expense, excluding internal service funds, was charged to governmental functions as follows: Instruction $ 33,186,002Instructional Resources and Media Services 2,985,006 Curriculum Development and Instructional Staff Development 7,781 Instructional Leadership 6,799 School Leadership 1,603,914 Guidance, Counseling and Evaluation Services 468,221 Health Services 310,183 Student (Pupil) Transportation 2,567,056 Food Services 3,026,751 Cocurricular/Extracurricular Activities 6,077,810 General Administration 21,510 Plant Maintenance and Operations 6,250,372 Security and Monitoring Service 81,253 Data Processing Services 725,704 Community Services 59,261 Total Governmental Funds 57,377,623

Depreciation/Amortization on capital assets held by the District's Internal Service Funds is charged to the various functions based on their usage of the assets 1,884,985

Total Depreciation/Amortization Expense - Governmental Activities $ 59,262,608

Total Depreciation/Amortization Expense - Business - Type Activities $ 477,814




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F. BONDS AND NOTES PAYABLE Bonded indebtedness of the District is reflected in the Statement of Net Position. Current requirements for principal and interest expenditures are accounted for in the Debt Service Fund. A summary of changes in bonds and notes (“bonds”) payable for the year ended June 30, 2015 is as follows:

OriginalDescription Balance

Unlimited Tax School Building Bonds - Series 2004 $ 300,000,000Unlimited Tax Refunding Bonds - Series 2004 189,435,000Unlimited Tax Refunding Bonds - Series 2004* 308,384Unlimited Tax School Building Bonds - Series 2005 149,000,000Unlimited Tax Refunding Bonds - Series 2005 124,580,000Unlimited Tax Refunding Bonds - Series 2007 246,795,000Unlimited Tax School Building Bonds - Series 2007A* 71,590,965Unlimited Tax School Building Bonds - Series 2007A 417,000,000Limited Tax Maintenance Notes - Series 2010 37,545,000Unlimited Tax School Building

and Refunding Bonds - Series 2012 180,610,000Variable Rate Unlimited Tax School Building Bonds Series 2013A 75,000,000Variable Rate Unlimited Tax School Building Bonds Series 2013B 73,795,000Unlimited Tax School Building Bonds - Series 2013 58,905,000Unlimited Tax Refunding Bonds - Series 2014 33,215,000Unlimited Tax Refunding Bonds - Series 2014A 121,735,000Variable Rate Unlimited Tax School Building Bonds Series 2014 70,825,000Variable Rate Unlimited Tax School Building Bonds - Series 2013A

(2014 Remarketing) 67,325,000Unlimited Tax Refunding Bonds - Series 2014B 69,925,000Unlimited Tax Refunding Bonds - Series 2015 345,185,000Unlimited Tax Refunding Bonds - Series 2015A 51,495,000

$ 2,684,269,349

* Capital appreciation bonds ** Additions to capital appreciation bonds include interest accretion for the year ended June 30, 2015. The capital appreciation bonds are included in bonds payable at their accreted value, for principal amounts due as of June 30, 2015.




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Beginning Refunded/ Ending Balance Additions** Payments Remarketed Balance

$ 7,600,000 $ - $ 7,600,000 $ - $ - 20,315,000 - 20,315,000 - -

671,982 8,018 680,000 - - 79,585,000 - 3,550,000 76,035,000 - 57,905,000 - - 57,905,000 -

246,795,000 - - - 246,795,00021,135,942 485,058 10,830,000 - 10,791,000

417,000,000 - - 357,160,000 59,840,00037,545,000 - - - 37,545,000

178,455,000 - 1,000,000 - 177,455,00075,000,000 - 6,360,000 68,640,000 - 73,795,000 - - - 73,795,00058,905,000 - 980,000 - 57,925,00033,215,000 - - - 33,215,000

121,735,000 - - - 121,735,00070,825,000 - - - 70,825,000

- 67,325,000 - - 67,325,000- 69,925,000 1,265,000 - 68,660,000- 345,185,000 - - 345,185,000- 51,495,000 - - 51,495,000

$ 1,500,482,924 $ 534,423,076 $ 52,580,000 $ 559,740,000 $ 1,422,586,000




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F. BONDS AND NOTES PAYABLE (continued) The general obligation bonds mature and the capital appreciation bonds accrete in value through 2045 as follows:

Year Ending June 30, Principal Interest Total

2016 $ 52,055,000 $ 57,080,272 $ 109,135,2722017 54,000,000 61,411,413 115,411,413 2018 44,430,000 59,022,563 103,452,563 2019 51,240,000 58,489,538 109,729,538 2020 55,785,000 59,342,688 115,127,688

2021-2025 267,055,000 265,044,403 532,099,403 2026-2030 380,845,000 183,258,795 564,103,795 2031-2035 278,830,000 100,540,488 379,370,488 2036-2040 162,590,000 42,172,625 204,762,625 2041-2045 75,795,000 9,777,550 85,572,550

1,422,625,000 $ 896,140,335 $ 2,318,765,335Less interest accretion

in future years 39,000Total principal due at

June 30, 2015 $ 1,422,586,000

There are a number of limitations and restrictions contained in the general obligation bond indenture. The District is in compliance with all significant limitations and restrictions as of June 30, 2015. Summary information for the capital appreciation bonds is as follows:

Original Accreted Amount Value

Series Outstanding June 30, 2015

Unlimited Tax School Building Bonds - Series 2007A $ 7,743,775 $ 10,791,000




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F. BONDS AND NOTES PAYABLE (continued) The District issued three series of refunding bonds during the year ended June 30, 2015. The bonds were issued to reduce its total debt service payments to obtain an economic gain (difference between the present value of the old and new debt service payments). Amounts received from the issuance of refunding debt (and any required District contribution) were deposited into an irrevocable trust with an escrow agent to provide for all future debt service payments of the refunded debt. As a result, the refunded bonds are considered to be defeased and the liability for those bonds has been removed from the government-wide statement of net position. The District issued $69,925,000 in Unlimited Tax Refunding Bonds (series 2014B) of outstanding bonds in a current refunding of $76,035,000 of outstanding debt. The proceeds of $78,423,784 (net of $643,843 in underwriting fees and issuance costs plus $8,254,209 of premium and $244,575 of District cash contribution) were used to purchase state and local government securities. The District completed the refunding to reduce its total debt service payments over the next 20 years by $12,492,421 and to obtain an economic gain (difference between the present value of the old and new debt service payments) of $10,060,009. The refunding resulted in a difference between the reacquisition price and the net carrying amount of the old debt of $1,495,949. The difference, reported in the accompanying financial statements as a deferred outflow, is being charged to operations through the year 2038. The District issued $345,185,000 in Unlimited Tax Refunding Bonds (Series 2015) to advance refund $357,160,000 of outstanding bonds. The refunding proceeds of $396,981,463 (net of $2,142,819 in underwriting fees and issuance costs plus $42,867,463 of premium and $8,929,000 of District cash contribution) were used to purchase open market federal securities. The advance refunding resulted in a difference between the reacquisition price and the net carrying amount of the old debt of $28,746,189. The difference, reported in the accompanying financial statements as a deferred outflow, is being charged to operations through the year 2037. Total debt service payments decreased over the next 22 years by $69,589,453 and results in an economic gain (difference between the present value of the old and new debt service payments) of $49,850,319. The District issued $51,495,000 in Unlimited Tax Refunding Bonds (series 2015A) of outstanding bonds in a current refunding of $57,905,000 of outstanding debt. The proceeds of $59,914,585 (net of $523,871 in underwriting fees and issuance costs plus $7,349,078 of premium and $1,070,507 of District cash contribution) were used to purchase open market federal securities. The District completed the refunding to reduce its total debt service payments over the next 15 years by $12,010,917 and to obtain an economic gain (difference between the present value of the old and new debt service payments) of $9,600,564. The refunding resulted in a difference between the reacquisition price and the net carrying amount of the old debt of $413,965. The difference, reported in the accompanying financial statements as a deferred outflow, is being charged to operations through the year 2030.




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F. BONDS AND NOTES PAYABLE (continued) In addition, the District converted the Variable Rate Unlimited Tax School Building Bonds, Series 2013A from the existing one-year note paying interest at one percent to a four-year note paying interest at two percent through July 31, 2018. The District contributed $5,300,000 to the Payment Fund at the time of closing. The conversion of the bonds resulted in a reduction in the amount of outstanding bonds from $75,000,000 at June 30, 2015 to $67,325,000. The refunded or remarketed debt was from four series as follows:

AmountsRefunded/

Series Remarketed

Unlimited Tax School Building Bonds - Series 2005 2014B $ 76,035,000Unlimited Tax School Refunding Bonds - Series 2005 2015 57,905,000Unlimited Tax Refunding Bonds - Series 2007A 2015A 357,160,000Unlimited Tax Refunding Bonds - Series 2013A 2014 68,640,000

$ 559,740,000

In prior years, the District defeased certain general obligation and other bonds by placing the proceeds of new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the District's financial statements. As of June 30, 2015, $480,840,000 of refunded bonds outstanding are considered to be defeased. The District has no authorized but unissued debt at June 30, 2015.




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G. ACCUMULATED STATE PERSONAL AND SICK LEAVE BENEFITS Upon separation from the District, employees with ten consecutive years of service in the District and eligible to receive benefits under the Teacher Retirement System of Texas shall be entitled to a lump sum cash payment for any unused accrued State leave or local leave earned in the District. The District implemented this as an incentive to retain employees. Employees receive reimbursement equivalent to one-half the daily rate of pay at the time of their separation from the District up to a maximum of $40 per day for up to 80 days, and one-fourth the daily rate of pay to a maximum of $20 per day for days in excess of 80 for days earned through June 30, 2005. For days earned after June 30, 2005, employees will receive reimbursement equivalent to one half the daily rate of pay at the time of their separation from the District up to a maximum of $75 per day up to 80 days and one fourth the daily rate of pay up to a maximum of $65 per day for days in excess of 80. A summary of changes in the accumulated State personal and sick leave liability follows:

Balance July 1, 2014 $ 3,665,342Additions - New Entrants and Salary Increments 868,209Deductions - Payments to Participants (586,222)Balance June 30, 2015 $ 3,947,329

Current Portion $ 565,968

No liability for accumulated sick leave is recorded in the governmental funds unless the employee has met the requirements and the amounts are due. No such liability existed as of June 30, 2015.




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H. DEFINED BENEFIT PENSION PLAN Plan Description The District participates in a cost-sharing multiple-employer defined benefit pension that has a special funding situation. The plan is administered by the Teacher Retirement System of Texas (TRS). TRS’s defined benefit pension plan is established and administered in accordance with the Texas Constitution, Article XVI, Section 67 and Texas Government Code, Title 8, Subtitle C. The pension trust fund is a qualified pension trust under Section 401(a) of the Internal Revenue Code. The Texas Legislature establishes benefits and contribution rates within the guidelines of the Texas Constitution. The pension’s Board of Trustees does not have the authority to establish or amend benefit terms. All employees of public, state-supported educational institutions in Texas who are employed for one-half or more of the standard work load and who are not exempted from membership under Texas Government Code, Title 8, Section 822.002 are covered by the system. Pension Plan Fiduciary Net Position Detailed information about the Teacher Retirement System’s fiduciary net position is available in a separately-issued Comprehensive Annual Financial Report that includes financial statements and required supplementary information. That report may be obtained on the Internet at http://www.trs.state.tx.us/about/documents/cafr.pdf#CAFR; by writing to TRS at 1000 Red River Street, Austin, TX, 78701-2698; or by calling (512) 542-6592. Benefits Provided TRS provides service and disability retirement, as well as death and survivor benefits, to eligible employees (and their beneficiaries) of public and higher education in Texas. The pension formula is calculated using 2.3 percent (multiplier) times the average of the five highest annual creditable salaries times years of credited service to arrive at the annual standard annuity except for members who are grandfathered, the three highest annual salaries are used. The normal service retirement is at age 65 with 5 years of credited service or when the sum of the member’s age and years of credited service equals 80 or more years. Early retirement is at age 55 with 5 years of service credit or earlier than 55 with 30 years of service credit. There are additional provisions for early retirement if the sum of the member’s age and years of service credit total at least 80, but the member is less than age 60 or 62 depending on date of employment, or if the member was grandfathered in under a previous rule. There are no automatic post-employment benefit changes; including automatic COLAs. Ad hoc post-employment benefit changes, including ad hoc COLAs can be granted by the Texas Legislature as noted in the Plan description above.




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H. DEFINED BENEFIT PENSION PLAN (continued)

Contributions Contribution requirements are established or amended pursuant to Article 16, section 67 of the Texas Constitution which requires the Texas legislature to establish a member contribution rate of not less than 6% of the member’s annual compensation and a state contribution rate of not less than 6% and not more than 10% of the aggregate annual compensation paid to members of the system during the fiscal year. Texas Government Code section 821.006 prohibits benefit improvements, if as a result of the particular action, the time required to amortize TRS’ unfunded actuarial liabilities would be increased to a period that exceeds 31 years, or, if the amortization period already exceeds 31 years, the period would be increased by such action. Employee contribution rates are set in state statute, Texas Government Code 825.402. Senate Bill 1458 of the 83rd Texas Legislature amended Texas Government Code 825.402 for member contributions and established employee contribution rates for fiscal years 2014 thru 2017. It also added a 1.5% contribution for employers not paying Old Age Survivor and Disability Insurance (OASDI) on certain employees effective for fiscal year 2015 as discussed in Note 1 of the TRS 2014 CAFR. The 83rd Texas Legislature, General Appropriations Act (GAA) established the employer contribution rates for TRS fiscal years 2014 and 2015.

2014 2015

Members (Employees) 6.4% 6.7%Employers (Districts) 6.8% 6.8%Non-Employer Contributing Entity (State of Texas) 6.8% 6.8%

2014District Employees $ 25,065,608District $ 7,141,048State of Texas $ 19,693,145

Plan Year Contributions

Plan Year Contribution Rates

Contributions shown above are for the plan year which runs from September 1st through August 31st and are shown for the year of the measurement date.




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H. DEFINED BENEFIT PENSION PLAN (continued) Contributors to the plan include members, employers and the State of Texas as the only non-employer contributing entity. The State is the employer for senior colleges, medical schools and state agencies including TRS. In each respective role, the State contributes to the plan in accordance with state statutes and the GAA. As the non-employer contributing entity for public education and junior colleges, the State of Texas contributes to the retirement system an amount equal to the current employer contribution rate times the aggregate annual compensation of all participating members of the pension trust fund during that fiscal year reduced by the amounts described below which are paid by the employers. Employers (public school, junior college, other entities or the State of Texas as the employer for senior universities and medical schools) are required to pay the employer contribution rate in the following instances:

• On the portion of the member's salary that exceeds the statutory minimum for members entitled to the statutory minimum under Section 21.402 of the Texas Education Code.

• During a new member’s first 90 days of employment. • When any part or all of an employee’s salary is paid by federal funding sources, a

privately sponsored source, from non-educational and general, or local funds. • In addition to the employer contributions listed above, when employing a retiree of the

Teacher Retirement System the employer shall pay both the member contribution and the state contribution as an employment after retirement surcharge.




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H. DEFINED BENEFIT PENSION PLAN (continued) Actuarial Assumptions The total pension liability in the August 31, 2014 actuarial valuation was determined using the following actuarial assumptions: Valuation Date 31-Aug-14Actuarial Cost Method Individual Entry Age NormalAmortization Method Level Percentage of Payroll, OpenRemaining Amortization Period 30 yearsAsset Valuation Method 5 year Market ValueDiscount Rate 8.00%Long-term expected Investment Rate of Return* 8.00%Salary Increases* 4.25% to 7.25%Weighted-Average at Valuation Date 5.55%Payroll Growth Rate 3.50%

* Includes inflation rate of 3%

The actuarial methods and assumptions are primarily based on a study of actual experience for the four year period ending August 31, 2010 and adopted on April 8, 2011. With the exception of the post-retirement mortality rates for healthy lives and a minor change to the expected retirement age for inactive vested members stemming from the actuarial audit performed in the Summer of 2014, the assumptions and methods are the same as used in the prior valuation. When the mortality assumptions were adopted in 2011 they contained a significant margin for possible future mortality improvement. As of the date of the valuation there has been a significant erosion of this margin to the point that the margin has been eliminated. Therefore, the post-retirement mortality rates for current and future retirees was decreased to add additional margin for future improvement in mortality in accordance with the Actuarial Standards of Practice No. 35. Discount Rate The discount rate used to measure the total pension liability was 8.0%. There was no change in the discount rate since the previous year. The projection of cash flows used to determine the discount rate assumed that contributions from plan members and those of the contributing employers and the non-employer contributing entity are made at the statutorily required rates. Based on those assumptions, the pension plan’s fiduciary net position was projected to be available to make all future benefit payments of current plan members. Therefore, the long-term




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H. DEFINED BENEFIT PENSION PLAN (continued) expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. The long-term rate of return on pension plan investments is 8%. The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimates ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of geometric real rates of return for each major asset class included in the Systems target asset allocation as of August 31, 2014 are summarized below:

Long-TermReal Return Expected

Target Geometric Portfolio RealAsset Class Allocation Basis Rate of Return*

Global EquityU.S. 18.0 % 7.0 1.4 %Non-U.S. Developed 13.0 7.3 1.1Emerging Markets 9.0 8.1 0.9Directional Hedge Funds 4.0 5.4 0.2Private Equity 13.0 9.2 1.4

Stable ValueU.S. Treasuries 11.0 2.9 0.3Absolute Return 0.0 4.0 0.0Stable Value Hedge Funds 4.0 5.2 0.2Cash 1.0 2.0 0.0

Real ReturnGlobal Inflation Linked Bonds 3.0 3.1 0.0Real Assets 16.0 7.3 1.5Energy and Natural Resources 3.0 8.8 0.3Commodities 0.0 3.4 0.0

Risk ParityRisk Parity 5.0 8.9 0.4Alpha 0.0 0.0 1.0

Total 100.0 % 82.6 % 8.7 %* The Expected Contribution to Returns incorporates the volatility drag resulting from the

conversion between Arithmetic and Geometric mean returns.




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H. DEFINED BENEFIT PENSION PLAN (continued) Discount Rate Sensitivity Analysis The following schedule shows the impact of the Net Pension Liability if the discount rate used was 1% less than and 1% greater than the discount rate that was used (8%) in measuring the District’s 2014 Net Pension Liability.

Discount Rate (7.0%)1% Decrease in

Discount Rate (8.0%) Discount Rate (9.0%)1% Increase in

$134,444,370 $75,237,231 $30,961,318 Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2015, the District reported a liability of $75,237,231 for its proportionate share of the TRS’s net pension liability. This liability reflects a reduction for State pension support provided to the District. The amount recognized by the District as its proportionate share of the net pension liability, the related State support, and the total portion of the net pension liability that was associated with the District were as follows:

District's proportionate share of the collective net pension liability $ 75,237,231State's proportionate share associated with the District 207,927,211Total $ 283,164,442

The net pension liability was measured as of August 31, 2014 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The District’s proportion of the net pension liability was based on the District’s contributions to the pension plan relative to the contributions of all employers to the plan for the period September 1, 2013 through August 31, 2014. At August 31, 2014 the employer’s proportion of the collective net pension liability was 0.002816673%. The change in proportion was regarded as immaterial by TRS and disregarded this year. There were no changes of assumptions or other inputs that affected measurement of the total pension liability during the measurement period. There were no changes of benefit terms that affected measurement of the total pension liability during the measurement period.




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H. DEFINED BENEFIT PENSION PLAN (continued) There was a change in employer contribution requirements that occurred after the measurement date of the net pension liability and the employer’s reporting date. A 1.5% contribution for employers not paying Old Age Survivor and Disability Insurance (OASDI) on certain employees went into law effective 09/01/2014. The amount of the expected resultant change in the employer’s proportion cannot be determined at this time. For the year ended June 30, 2015, the District recognized pension expense of $19,122,484 and revenue of $19,122,484 for support provided by the State. At June 30, 2015 the District reported its proportionate share of the TRS’s deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred DeferredOutflows of Inflows ofResources Resources

Difference between expected and actual economic experience $ 1,163,568 $ - Changes in actuarial assumptions 4,890,504 - Difference between projected and actual investment earnings - 22,995,570Changes in proportion and difference between the employer's

contributions and the proportionate share of contributions - 19,722Contributions paid to TRS subsequent to the measurement date 10,842,650 -

Total $ 16,896,722 $ 23,015,292

The net amounts of the employer’s balances of deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: Year EndedJune 30, Pension Expense

2016 $ (4,730,900)2017 (4,730,900)2018 (4,730,900)2019 1,017,9932020 944,387

Therafter -




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I. SCHOOL DISTRICT RETIREE HEALTH PLAN Plan Description The District contributes to the Texas Public School Retired Employees Group Insurance Program (TRS-Care), a cost-sharing multiple employer defined benefit postemployment health care plan administered by TRS. TRS-Care provides health care coverage for certain persons (and their dependents) who retired under TRS. The statutory authority for the program is Texas Insurance Code, Chapter 1575. Section 1575.052 grants the TRS Board of Trustees the authority to establish and amend basic and optional group insurance coverage for participants. The TRS issues a publicly available financial report that includes financial statements and supplementary information for TRS-Care. That report may be obtained by visiting the TRS web site at www.trs.state.tx.us, by writing to the Communications Department of the Teacher Retirement System of Texas at 100 Red River Street, Austin, TX 78701, or by calling 1-800-223-8778. Funding Policy Contribution requirements are not actuarially determined but are established each biennium by the Texas Legislature. Texas Insurance Code Sections 1575.202, 203, and 204 establish state, active employee, and public school contributions, respectively. Funding for free basic coverage is provided by the program based upon public school district payroll. Funding for optional coverage is provided by those participants selecting the optional coverage. The State of Texas contribution rate was 1.0% for fiscal year 2015, 1.0% for fiscal year 2014, and 0.5% for fiscal year 2013. Active public school employee rates and school district contribution rates were set at 0.65% and 0.55% of payroll for all three fiscal years. Per Texas Insurance Code, Chapter 1575, the public school contribution may not be less than 0.25% or greater than 0.75% of the salary of each active employee of the public school. The contributions to TRS-Care made by the State, active employees, and the District for fiscal years 2015, 2014, and 2013 equaled the required contributions and are as follows:

Year Ended Year Ended Year EndedJune 30, June 30, June 30,

2015 2014 2013

State TRS-Care On-Behalf Contributions $ 4,032,391 $ 3,814,429 $ 2,007,423Active Member's Contributions 2,621,054 2,544,375 2,486,053District Contributions to TRS-Care 2,232,162 2,152,932 2,103,584

$ 8,885,607 $ 8,511,736 $ 6,597,060

Revenue and expenditures equal to the amount paid by the State of Texas for on-behalf fringe benefits were recognized during the fiscal year.




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I. SCHOOL DISTRICT RETIREE HEALTH PLAN (continued) Medicare Part D Federal legislation enacted in January 2006 established prescription drug coverage for Medicare beneficiaries known as Medicare Part D. One provision of the law allows TRS-Care to receive retiree drug subsidy payments from the federal government to offset certain prescription drug expenditures for eligible participants. These payments totaled $1,240,773, $602,391, and $1,542,113 for fiscal years 2015, 2014, and 2013, respectively. Revenue and expenditures equal to the amount paid by the federal government were recognized during the fiscal year. J. OTHER POST EMPLOYMENT BENEFITS (OPEB) The District also offers medical, dental, and life insurance coverage to certain retirees who have continued their coverage with the District’s insurance plans since their retirement. The option to continue coverage is no longer offered; thereby, participation in the plan is limited to those employees who retired prior to August 31, 2004. Plan Description The plan is a single employer plan offering continued medical coverage under the District’s medical insurance for retirees and their dependents with the retiree paying both the employee and District contributions. If Medicare coverage is available, the District’s third party administrator, Blue Cross/Blue Shield of Texas, will coordinate coverage with Medicare acting as the primary insurer. The plan does not issue a separate set of financial statements.




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J. OTHER POST EMPLOYMENT BENEFITS (OPEB) (continued) Annual OPEB Cost The District’s annual OPEB cost and net OPEB obligation for the past three fiscal years are as follows:

June 30, June 30, June 30,2015 2014 2013

Annual Required Contribution (ARC) $ 215,814 $ 205,114 $ 314,448Interest on Prior Year Net OPEB (Benefit)/Obligation 7,369 8,422 5,579 Adjustment to the ARC (7,040) (8,045) (7,652) Annual OPEB Cost 216,143 205,491 312,375Retiree Claims Paid (219,953) (231,811) (227,380) Increase/(Decrease) in Net OPEB Obligation $ (3,810) $ (26,320) $ 84,995

Net OPEB (Benefit)/Obligation at June 30 $ 180,414 $ 184,224 $ 210,544

Percentage of ARC Contributed 101.8% 112.8% 72.8%

The funded status of the plan for the past three fiscal years is as follows:

June 30, June 30, June 30, 2015 2014 2013

Schedule of Funding ProgressActuarial Accrued Liability $ 3,726,633 $ 3,737,374 $ 4,709,198Actuarial Value of Plan Assets - - - Funded Ratio (actuarial value of plan assets/AAL) 0% 0% 0%

Unfunded Actuarial Accrued Liability $ 3,726,633 $ 3,737,374 $ 4,709,198

Actuarial valuation of an ongoing plan involves estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include mortality, the healthcare cost trend, and insurance benefits offered in the future. Amounts determined regarding the funded status of the plan and the annual required contribution of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, shown above, presents information that will show whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits.




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J. OTHER POST EMPLOYMENT BENEFITS (OPEB) (continued) Projections of benefits for financial reporting purposes are based on the substantive plan (as understood by the District and its plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the District and plan members at that time. The actuarial methods and assumptions used include techniques that are designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. In the June 30, 2015 actuarial valuation, the projected unit credit cost method was used. The actuarial assumptions used include a 4.00% rate compounded annually for an unfunded plan, claims costs for future years equal the costs for the current year adjusted for assumed healthcare cost trends beginning at a rate of 10.0% for fiscal year 2015, an inflation rate of 4.0% annually, and a 3.0% increase in claims per year per member. A closed amortization period of 30 years was used to compute the District’s Annual Required Contribution. Since the plan is closed to new members, there is no annual covered payroll costs associated with the plan. Contributions to fund the net OPEB obligation are made by the Health Insurance Fund. K. RISK MANAGEMENT The District is exposed to various risks or torts; theft of, damage to, and destruction of assets; injuries to employees; and natural disasters. During fiscal year 2015, the District purchased insurance coverage for property, general liability, fleet liability, errors and omissions, crime, various cyber liability and network insurance coverage, extortion, equipment breakdown coverage, storage tank liability, and police professional liability. Internal Service Funds purchased self-funded unemployment compensation insurance, employee health stop-loss coverage, and workers’ compensation excess coverage. There has been no significant reduction in insurance coverage from the prior year by major category of risk. There were three instances in fiscal year 2014-15 that the District had insurance settlements that reached the amount of its stop-loss coverage limit. There were two insurance settlements that reached the stop-loss coverage limit in the prior two years combined. Detailed information on the major categories of risk is as follows:




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K. RISK MANAGEMENT Employee Health Coverage (continued) The District’s major medical program offers two plan options, which are self-funded through an Internal Service Fund. Under two plan options, the District carries $520,000 specific stop-loss (SSL) coverage, aggregate stop-loss coverage of 125%, and the plans have an unlimited maximum lifetime SSL benefit. Accrued expenses in the Health Insurance Fund are based on actuarial estimates of the amounts necessary to pay prior and current period claims and to establish a reserve for catastrophic losses. A liability claim is established if information indicates it is probable that a liability has been incurred at the date of the financial statements, and the amount of the loss is reasonably estimable. A reconciliation of changes in the aggregate liabilities for major medical claims for the prior and current fiscal period is presented below:

Beginning of Claims and End of Fiscal Year Changes in Claim Fiscal Year

Liability Estimates Payments Liability

2013-14 $ 4,323,788 $ 55,258,771 $ (55,602,559) $ 3,980,0002014-15 $ 3,980,000 $ 53,527,700 $ (53,495,535) $ 4,012,165




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K. RISK MANAGEMENT (continued) Employee Dental Program The District’s dental program is self-funded through an Internal Service Fund. It is a voluntary program funded solely by employee contributions. Cost containment features include a graded benefit schedule to deter adverse selection into the plan, maximum annual benefit of $1,750 and deductibles/coinsurance. The District and third-party administrator determine projected claim costs and administrative fees. A liability for a claim is established if information indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss is reasonably estimable. A reconciliation of changes in the aggregate liabilities for the dental program for the prior and current fiscal period is below:



2013-14 $ 260,144 $ 3,472,145 $ (3,432,289) $ 300,0002014-15 $ 300,000 $ 3,348,115 $ (3,367,491) $ 280,624

Workers’ Compensation The District’s workers’ compensation program is self-funded through an Internal Service Fund. The District carries excess coverage of $400,000 specific stop-loss and aggregate stop-loss of $5,000,000. Amounts payable to the Workers’ Compensation Fund are based on actuarial estimates of the amounts necessary to pay prior and current period claims and to establish a reserve for catastrophic losses. A liability for a claim is established if information indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss is reasonably estimable. A reconciliation of changes in the aggregate liabilities for workers’ compensation claims for the prior and current fiscal period is presented below:



2013-14 $ 1,983,153 $ 743,578 $ (1,546,915) $ 1,179,8162014-15 $ 1,179,816 $ 749,838 $ (873,543) $ 1,056,111

The current portion of workers’ compensation claims is $300,000.




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L. CHANGES IN LONG-TERM LIABILITIES Activity for long-term liabilities for the year ended June 30, 2015, was as follows:

Due Beginning Ending Within

Governmental Activities: Balance Additions Reductions Balance One Year Bonds and Notes Payables: General Obligation Bonds $ 1,478,675,000 $ 533,930,000 $ 600,810,000 $ 1,411,795,000 $ 41,264,000 Capital Appreciation Bonds 21,807,924 493,076 11,510,000 10,791,000 10,791,000 Issuance Premiums Amortization 115,836,307 60,168,687 33,522,883 142,482,111 - Total Bonds and Notes Payable 1,616,319,231 594,591,763 645,842,883 1,565,068,111 52,055,000 Other Liabilities: Workers' Compensation

Accrued Claims Liability 1,179,816 749,838 873,543 1,056,111 300,000 Compensated Absences 3,665,342 868,209 586,222 3,947,329 565,968 TRS Net Pension Liability 92,385,148 - 17,147,917 75,237,231 - Net OPEB Obligation/(Benefit) 184,224 216,143 219,953 180,414 - Total Other Liabilities 97,414,530 1,834,190 18,827,635 80,421,085 865,968 Total Governmental Activities

Long-term Liabilities $ 1,713,733,761 $ 596,425,953 $ 664,670,518 $ 1,645,489,196 $ 52,920,968

Additions to capital appreciation bonds consist of interest accretion for the year ended June 30, 2015. The compensated absence liability is liquidated using the fund where the employee’s salary is charged. The majority of the District’s salaries are accounted for in the General Fund.




84

M. UNEARNED REVENUE Unearned revenue in the District’s governmental funds at June 30, 2015 consisted of the following:

NonmajorGeneral Governmental

Fund Funds Total

National Breakfast and Lunch Program $ - $ 882,345 $ 882,345Other Federal Grants - 4,917 4,917Advanced Placement

Initiatives - 43,005 43,005State Textbook - 721,163 721,163Misc State Grants - 4,729 4,729Coalition of Essential Schools - 1,070 1,070Asia Society - 22,436 22,436Misc Local - 3,069 3,069Other 35,055 - 35,055Total $ 35,055 $ 1,682,734 $ 1,717,789

The District’s proprietary funds reported unearned revenue as of June 30, 2015 as follows:

Enterprise Fund

Community Education $ 50,155PPCD 22,820NEAT 8,110Total $ 81,085




85

N. DUE FROM OTHER GOVERNMENTS The District participates in a variety of federal and state programs from which it receives grants to partially or fully finance certain activities. In addition, the District receives entitlements from the State through the School Foundation and Per Capita Programs. Amounts due from federal and state governments as of June 30, 2015 are presented below. All federal grants shown below are passed through the TEA and are reported as Due From Other Governments.

General Nonmajor

GovernmentalInternal Service Total

State Entitlements $ 30,004,982 $ - $ - $ 30,004,982State Pass Through Grants - 7,101,489 - 7,101,489Federal Grants 46,490 222,022 - 268,512Other 4,467,650 - 338 4,467,988Total $ 34,519,122 $ 7,323,511 $ 338 $ 41,842,971

O. RECEIVABLES Receivables as of June 30, 2015 for the District’s individual major governmental funds and other nonmajor governmental funds in the aggregate, including the applicable allowances for uncollectible accounts, are as follows:

Taxes $ 15,637,604 $ 5,567,444 $ - $ - $ 21,205,048Due From Other Governments 34,519,122 - - 7,323,511 41,842,633Interest 278,324 97,154 107,160 18,032 500,670Other Receivables 526,312 30,520 13,723 17,314 587,869Gross Receivables 50,961,362 5,695,118 120,883 7,358,857 64,136,220

Less: Allowance for Uncollectible (1,295,100) (431,197) - - (1,726,297)Net Total Receivables $ 49,666,262 $ 5,263,921 $ 120,883 $ 7,358,857 $ 62,409,923

Nonmajor Governmental

Funds TotalGeneralDebt

ServiceCapital Projects




86

O. RECEIVABLES (continued) Receivables as of June 30, 2015 for the District’s proprietary-type funds in the aggregate are as follows:

Interest $ - $ 37,860 $ 37,860Due From Other Governments - 338 338Other Receivables 113,068 339,691 452,759Gross Receivables $ 113,068 $ 377,889 $ 490,957

Internal Service Funds Total

Enterprise Funds

P. REVENUE FROM LOCAL AND INTERMEDIATE SOURCES During the current fiscal year, revenues from local and intermediate sources in the Governmental Fund Types consisted of the following:

Debt Capital NonmajorGeneral Service Projects Governmental Fund Fund Fund Funds Total

Property Taxes $ 316,545,636 $ 121,999,925 $ - $ - $ 438,545,561Penalties, Interest and Other

Tax Related Income 1,882,943 604,238 - - 2,487,181Investment Income 548,682 119,124 415,080 19,794 1,102,680Food Sales - - - 12,858,113 12,858,113Tuition and Fees 893,534 - - - 893,534Co-curricular Student Activities 1,477,235 - - - 1,477,235Other 2,212,087 - 20,036 7,337,091 9,569,214Total $ 323,560,117 $ 122,723,287 $ 435,116 $ 20,214,998 $ 466,933,518




87

P. REVENUE FROM LOCAL AND INTERMEDIATE SOURCES (continued) During the current fiscal year, revenues from local and intermediate sources in the Proprietary Fund Types consisted of the following:

Internal Service Funds

Enterprise Funds Total

User Charges $ 78,629,231 $ - $ 78,629,231Tuition and Fees - 8,567,368 8,567,368Rent 3,000 444,067 447,067Athletics - 797,833 797,833Enterprising Activities 136,591 72,618 209,209Other Revenue from Local Sources 372,029 324,159 696,188Total $ 79,140,851 $ 10,206,045 $ 89,346,896

Q. LITIGATION The District is a defendant in several cases relating to accidents and other matters. While the result of any litigation contains an element of uncertainty, the District's management believes the amount of any liability and costs which might result would not have a material adverse effect on the financial statements. R. CONSTRUCTION AND OTHER SIGNIFICANT COMMITMENTS AND

CONTINGENCIES The District participates in numerous state and federal grant programs which are governed by various rules and regulations of the grantor agencies. Costs charged to the respective grant programs are subject to audit and adjustment by the grantor agencies; therefore, to the extent that the District has not complied with the rules and regulations governing the grants, refunds of any money received may be required and the collectibility of any related receivable may be impaired. In the opinion of the District, there are no significant contingent liabilities relating to compliance with the rules and regulations governing the respective grants; therefore, no provision has been recorded in the accompanying basic financial statements for such contingencies. At June 30, 2015, the District was committed under the terms of various construction contracts for new school facilities and the remodeling of existing facilities for $81,766,023.




88

R. CONSTRUCTION AND OTHER SIGNIFICANT COMMITMENTS AND CONTINGENCIES (continued)

As discussed in footnote III.A, encumbrance accounting is used to ensure budgetary control and accountability. At June 30, 2015, the amount of encumbrances expected to be honored upon performance of the service of delivery of merchandise by vendors in the subsequent year are as follows: General Fund $ 2,868,896Debt Service Fund 3,500Nonmajor Governmental Funds 3,784,189Enterprise Funds 188,908Internal Service Funds 1,675,537

$ 8,521,030

S. SHARED SERVICE ARRANGEMENTS The District participates in the North East Independent School District Regional Day School Program for the Deaf (NEISD RDSPD), a shared service arrangement, with two member Districts: Comal ISD and Judson ISD. The District is acting as the fiscal agent for the parties involved. The NEISD RDSPD provides services to students from birth through 21 years of age who are auditorily impaired. Funding for the NEISD RDSPD is provided by the TEA and by the member districts at a per pupil cost of $12,500. Revenue from the respective member districts, including the District’s contribution, is as follows: North East ISD $ 406,752Judson ISD 100,000Comal ISD 25,000

$ 531,752

As fiscal agent, NEISD RDSPD is responsible for reporting all financial activities of the shared service arrangement. The District accounts for the activity in Special Revenue Fund 435.




89

T. ARBITRAGE The Federal Tax Reform Act of 1986 enacted section 148(f) of the Internal Revenue Code, relating to arbitrage rebate requirements, which generally provides that in order for interest on any issue of obligation to be excluded from gross income the issuer must rebate to the United States the sum of (1) the excess of the amount earned on all “non-purpose investments” acquired with “gross proceeds” of the issue over the amount which would have been earned if such investments had been invested at a yield equal to the yield on the issue, and (2) the earnings on such excess earnings. The Act requires issuers of tax-exempt debt to make payments to the United States Treasury for investment income received at yields that exceed the issuer’s tax exempt borrowing rates. The Treasury requires payment for each issue every five years. The estimated liability is updated annually for all tax-exempt issuances or changes in yields until such time payment of the calculated liability is due. As of June 30, 2015, the District had no arbitrage liability for applicable bond issues calculated to be due to the IRS. This amount is determined based on current investment yields and is subject to change prior to the due date of the rebate. The due date of the rebate is five years from the bond’s date of issuance. The District considers arbitrage a revenue-generated liability and has adjusted interest earnings for the annual change in the liability. U. FUND BALANCE The fund balance as of June 30, 2015 consists of the following amounts:

Debt Capital NonmajorGeneral Service Projects Government Fund Fund Fund Funds Total

Nonspendable:Inventory $ 2,455,320 $ - $ - $ 51,430 $ 2,506,750Scholarships - - - 200,000 200,000

Restricted:Debt Service - 90,277,490 - - 90,277,490Capital Acquisition - - 98,294,312 - 98,294,312Child Nutrition - - - 9,185,303 9,185,303Medicaid - - - 601,659 601,659Scholarships - - - 25,248 25,248

Committed:Campus Funds - - - 3,284,254 3,284,254

Assigned:Debt Service - 7,004,770 - - 7,004,770

Unassigned: 112,644,911 - - - 112,644,911Total $ 115,100,231 $ 97,282,260 $ 98,294,312 $ 13,347,894 $ 324,024,697




90

U. FUND BALANCE (continued) Committed fund balance within the Nonmajor Governmental funds represents fund balance in the Campus Activity fund which are funds raised by the campus for the campuses sole use. Assigned fund balance reported within the debt service fund represent amounts that are not collected from the interest and sinking fund tax levy and represent amounts set aside for debt maturing in future years. V. PRIOR PERIOD ADJUSTMENT During fiscal year 2015, the District adopted GASB Statement No. 68, Accounting and Reporting for Pensions. With the adoption of this standard, the District must assume their proportionate share of the Net Pension Liability of TRS. Adoption of GASB No. 68 required a prior period adjustment to report the effect of GASB 68 retroactively. The amount of the prior period adjustment is ($86,424,053). The restated net position for the Governmental Activities is $89,292,365 and for the Primary Government is $104,500,085. W. SUBSEQUENT EVENTS Subsequent to year end, the District converted the Variable Rate Unlimited Tax School Building Bonds, Series 2013B from the existing two-year note paying interest at two percent to a one-year note paying interest at two percent through July 31, 2016. The District contributed $6,360,000 to the Payment Fund at the time of closing. The conversion of the bonds resulted in a reduction in the amount of outstanding bonds from $72,610,000 at June 30, 2015 to $65,560,000. On November 3, 2015, voters approved a bond issuance of $499.9 million. The bonds will be used to increase security at schools, update technology, eliminate portable classrooms, and renovate existing facilities.

Required Supplementary Information

92


SCHEDULE OF THE DISTRICT'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY


TEACHER RETIREMENT SYSTEM OF TEXAS

NORTH EAST INDEPENDENT SCHOOL DISTRICT EXHIBIT G-1

2015

0.002816673%District's Proportion of the Net Pension Liability (Asset)

75,237,231 $District's Proportionate Share of Net Pension Liability (Asset)

207,927,911 State's Proportionate Share of the Net Pension Liability (Asset) associated with the District

283,165,142 $Total

390,530,090 $District's Covered-Employee Payroll

19.26%District's Proportionate Share of the Net Pension Liability (Asset) as a percentage of its covered-Employee Payroll

83.25%Plan Fiduciary Net Position as a Percentage of the Total Pension Liability

Note: Only one year of data is presented in accordance with GASB 68, Paragraph 138. "The information for all periods for the 10-year schedules that are required to be presented as required supplementary information may not be available initially. In these cases, during the transition period, that information should be presented for as many years as are available. The schedules should not include information that is not measured in accordance with the requirements of this Statement."

Note: GASB 68, Paragraph 81 requires that the information on this schedule be data from the period corresponding with the period covered as of the measurement date of August 31, 2014 - the period from September 1, 2013 - August 31, 2014.

93

SCHEDULE OF DISTRICT CONTRIBUTIONS

TEACHER RETIREMENT SYSTEM OF TEXAS

FOR FISCAL YEAR 2015

NORTH EAST INDEPENDENT SCHOOL DISTRICT EXHIBIT G-2

2015

Contractually Required Contribution 12,022,603 $

Contribution in Relation to the Contractually Required Contribution (12,022,603)

Contribution Deficiency (Excess) -0-$

District's Covered-Employee Payroll 404,080,393 $

Contributions as a Percentage of Covered-Employee Payroll 2.98%

Note: Only one year of data is presented in accordance with GASB 68, Paragraph 138. "The information for all periods for the 10-year schedules that are required to be presented as required supplementary information may not be available initially. In these cases, during the transition period, that information should be presented for as many years as are available. The schedules should not include information that is not measured in accordance with the requirements of this Statement."

Note: GASB 68, Paragraph 81 requires that the data in this schedule be presented as of the District's current fiscal year as opposed to the time period covered by the measurement date of September 1, 2013 - August 31, 2014.

94

Combining and Individual Fund Statements and Schedules

96



Nonmajor Governmental Funds

Fund Descriptions

97

SPECIAL REVENUE FUNDS The Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than major capital projects) that are legally restricted to expenditures for specified purposes. Elementary and Secondary Education Act (“ESEA”), Title X, Part C – Education for the Homeless Children and Youth (Fund 206) These funds are to be used to account, on a project basis, for funds allocated to local educational agencies to enable schools to provide a variety of staff development and supplemental services, including in-service training, counseling, psychological services and tutoring. This program is authorized under P. L. 107-110, McKinney-Vento Homeless Education Assistance Improvement of 2001 as amended by NCLB Act of 2001, Title X, Part C. (84.196) (U. S. Department of Education) ESEA, Title I, Part A – Improving Basic Programs (Fund 211) These funds are to be used to account, on a project basis, for funds allocated to local educational agencies to enable schools to provide opportunities for children served to acquire the knowledge and skills contained in the challenging State content standards and to meet the challenging State performance standards developed for all children. This program is authorized under P. L. 107-110. (84.010A) (U. S. Department of Education) Adult Basic Education, Federal (Fund 220) These funds are to be used to account, on a project basis, for funds granted to provide or support programs for adult education and literacy services to adults who are beyond compulsory school age attendance, and do not have a high school diploma, or lack sufficient mastery of basic educational skills to function effectively in society, or are unable to speak, read or write the English language; and are not enrolled in school. Education services include basic educational skills (reading, writing, speaking and mathematics), English as a Second Language instruction, and secondary level competencies for acquisition of a high school diploma or equivalent. This includes sections 322, 326, and 353 under P. L. 91.230 as amended by P. L. 102.73, The National Literacy Act. (84.002A) (U. S. Department of Education)



Fund Descriptions

98

Temporary Assistance for Needy Families (TANF) (Fund 223) These funds are to be used to account, on a project basis, for funds granted to provide educational services to undereducated adults who receive cash assistance under Temporary Assistance for Needy Families. Recipients of benefits are required to participate in adult basic education or job training programs as a condition of eligibility. Educational services include basic educational skills, English as a second language, instruction, and secondary level competencies for acquisition of a high school diploma or its equivalent. This program is authorized under P. L. 104-193. (93.558) (U. S. Department of Health and Human Services) Individuals With Disabilities Education Act – Part B (“IDEA-B”), Formula (Fund 224) These funds are to be used to account, on a project basis, for funds granted to operate educational programs for children with disabilities. This funding also includes capacity building and improvement (sliver) sub-grants. (84.027) (U. S. Department of Education) IDEA-B, Preschool (Fund 225) These funds are to be used to account, on a project basis, for funds granted for preschool children with disabilities. This program is authorized under P. L. 105-17 (84.173) (U.S. Department of Education) National School Breakfast and Lunch Program (Fund 240) Operations of the District’s cafeterias are accounted for in this fund. Revenue sources are principally from the sale of meals to students, teachers, and others, and the National School Breakfast and Lunch program. (10.555, 10.553, 10.565) Summer Feeding Program, Texas Department of Agriculture (TDA) (Fund 242) These funds are to be used to account, on a project basis, for funds received from the Texas Department of Agriculture that are used for meals provided to the community based on the average number of daily participants. (10.559) Career and Technical - Basic Grant (Fund 244) These funds are to be used to account, on a project basis, for funds granted to provide career and technology education to develop new and/or improve career and technology education programs for paid and unpaid employment. Full participation in the basic grant is from individuals who are members of special populations. (84.048) (U. S. Department of Education) In addition, funds are also provided for the Tech Prep Education Program from the U.S. Department of Education through the Texas Higher Education Coordinating Board. (84.243)



Fund Descriptions

99

ESEA, Title II, Part A - Teacher and Principal Training and Recruiting (Fund 255) These funds are used to provide financial assistance to LEAs to increase student academic achievement through improving teacher and principal quality and increasing the number of highly qualified teachers in classrooms and highly qualified principals and assistant principals in schools, and hold LEAs accountable for improving student academic achievement. This program is authorized under P. L. 107-110. (84.367A) (U. S. Department of Education) Title III, Part A - English Language Acquisition and Language Enhancement (Fund 263) These funds are used to account, on a project basis, for funds granted to improve the education of limited English proficient children, by assisting the children to learn English and meet challenging State academic content and student academic achievement standards. This program is authorized under P. L. 107-110. (84.365A) (U.S. Department of Education) Medicaid Administrative Claiming Program - MAC (Fund 272) These funds are used to account, on a project basis, for funds allocated to local education agencies for reimbursement of eligible administrative costs for activities attributed to the implementation of the Medicaid state plan. (93.778) Title VI, Part A, Summer School LEP & Advanced Placement Spanish Language (Fund 289) These funds are to be used to account, on a project basis, for funds granted for summer school programs for LEP students only if a bilingual program is part of the standard curriculum. Monies may be used to fund both required summer school and voluntary summer school LEP students. (84.369A) National School Lunch Program Equipment Assistance Grants (Fund 289) These funds are to be used to account, on a project basis, for funds granted to promote the consumption of nutritious foods in school and show children the importance of the 3E’s of Healthy Living - Education, Exercise, and Eating Right. (10.579) SSA IDEA-B, Discretionary (Fund 315) These funds are used to account, on a project basis, funds used by the fiscal agent of a shared services arrangement to support an education service center basic special education component and targeted support to LEAs, Regional Day School Programs for the Deaf, Private residential placements, priority projects and other emerging needs. (84.027) (U. S. Department of Education)



Fund Descriptions

100

SSA IDEA-B, Deaf (Fund 316) These funds are used to account, on a project basis, for funds granted to provide educational programs for children with disabilities. This fund includes capacity building and improvement (sliver) deaf sub-grants. (84.027) (U. S. Department of Education) SSA IDEA-B, Preschool Deaf (Fund 317) These funds are used to account, on a project basis, for funds granted to preschool children with disabilities. This program is authorized under P.L. 105-17. (84.173) (U. S. Department of Education) SSA IDEA-C, Early Intervention (Deaf) (Fund 340) These funds are used to account, on a project basis, for funds granted to assist local Regional Day School for the Deaf programs and the Texas School for the Deaf in providing direct services to hearing-impaired infants and toddlers, age’s birth through two years of age. This program provides supplemental and appropriate services to students that are provided by a Certified and trained teacher. This program is authorized under P. L. 101-119. (84.181A) (U. S. Department of Education) Adult Basic Education (ABE) - State (Fund 381) These funds are to be used to account, on a project basis, for funds granted to provide or support programs for adult education and literacy services to adults 16 years of age and above, who do not have a high school diploma and are out of school. State Supplemental Visually Impaired (SSVI) (Fund 385) These funds are to be used to account, on a project basis, for funds granted to provide supplemental services for the visually impaired. Non-educational Community-Based Support (Fund 392) These funds are to be used to account, on a project basis, for funds granted for the provision of non-educational community-based support services to students with disabilities who would remain or have to be placed in residential facilities for educational reasons without the provision of these services. The support services may include transportation, respite for the parents, case management, social work and in-home family support. (TEC 29.013)



Fund Descriptions

101

Advanced Placement Incentives (Fund 397) These funds are to be used to account, on a project basis, for funds awarded to school Districts under the Texas Advanced Placement Award Incentive Program, Chapter 28, Subchapter C, TEC. Texas Science, Technology, Engineering and Math (T-STEM) Academy (Fund 409) These funds are to be used to account, on a project basis, for funds granted to support the design and implementation of a T-STEM Academy. This Academy is designed to increase student achievement by engaging students through innovative science and math instructional techniques. Instructional Materials Allotment (IMA)/Texas Lending Program (Fund 410) These funds are used to account, on a project basis, for funds awarded to school districts under the textbook allotment. (TEC Chapter 31, Subchapter B) Senate Bill 6, Section 32.201 established a district technology lending program to ensure that all students have dedicated access to a personal technology device. Master Reading Teacher Program (Fund 421) These funds are used to account, on a project basis, for stipends to school districts with Master Reading teachers who are certified according to the provisions in TEC 21.0481. Certification Exam Reimbursement (Fund 427) These funds are used to account, on a project basis, for funds to reimburse school districts an amount equal to the cost paid by the district for a certification exam taken and passed by a student to qualify for a license or certificate. (TEC Section 29.190) Apprenticeship Training Program (Fund 429) The Apprenticeship Training Program is a structured system of training to prepare people for occupations in skilled trades, crafts, and other occupations. The Apprenticeship Training Program combines on the job training under the supervision of experienced journey workers with related classroom instruction. Read to Succeed Program (Fund 429) These funds are used to account, on a project basis, for funds awarded to help generate money for public school libraries and strengthen the campus-reading program. Funds are generated through the sale of specialty license plates. Members of the community have chosen to support school libraries in the District by purchasing these specialty license plates.



Fund Descriptions

102

Law Enforcement Officers Standards and Education Program (Fund 429) These funds are used to account, on a project basis, for funds awarded to school districts for the continuing education of persons licensed under Chapter 1701, Occupations Code. SSA Regional Day School for the Deaf (Fund 435) These funds are used by the fiscal agent of a shared services arrangement to account, on a project basis, for funds allocated for staff and activities of the Regional Day School Program for the Deaf. Campus Activity Funds (Fund 461) These funds are composed of various non-tax local monies generated at the campus-level via campus vending machines, assemblies, school-wide sales, etc. These are public funds under the responsibility and control of the campus administrator. They are used to promote the general welfare of the campus and the educational development and morale of all students within the campus. As public funds, they are subject to the same statutory controls and district regulations as the general fund. Coalition of Essential Schools (CES) (Fund 485) These funds are used solely to support the continued growth and development of equitable, vibrant small schools as well as the mentoring efforts and participation of the Mentor School in the CES Small Schools Network funded by the Bill & Melinda Gates Foundation. Fuel Up to Play 60 (Fund 486) These funds are used to support broad-based in-school promotions and strategies that create healthy eating and physical activity opportunities for students and the school environment. City of San Antonio SPARK Program (Fund 486) The Spark Program is in collaboration with the City of San Antonio, San Antonio Sports, and the District. This program is intended to modify and improve the recreational school grounds and facilities to allow public access during non-school operating hours.



Fund Descriptions

103

Dairy Optimization (Fund 486) These funds are used to purchase dairy merchandisers which support improved access to and consumption of low-fat/fat-free dairy. Whole Kids (Fund 486) These funds are granted to K-12 schools, to support a new or existing edible garden on school grounds. Texas School Health Awards (Fund 486) These funds are used to improve the lifelong health of students, staff and/or the greater school community. Asia Society (Fund 489) These funds are used to build the field of Chinese language teaching in American schools. H-E-B Award (Fund 490) The H-E-B District Excellence in Education funds are used to provide a variety of staff development throughout the district. Rackspace Foundation (Fund 490) These funds are used to provide resources and support to the Roosevelt High School cluster to create an engaged school environment enabling teachers, students and their families to reach their highest potential. PERMANENT FUND Scholarships (Fund 479) This fund is used to account for donations received where the earnings are available to fund scholarships for the District’s students and the principal received must remain intact.


COMBINING BALANCE SHEETNONMAJOR GOVERNMENTAL FUNDS

JUNE 30, 2015

Control

Data

Codes

ESEA

Title X, Pt.C

Homeless Basic Program

Improving

ESEA I, A

Federal

Education

Adult

Assistance

Family

TANF

206 211 220 223

ASSETS

- - - - $ $ $ $1110 Cash and Cash Equivalents

- - - - 1120 Investments - Current

4,459,366 42,208 72,422 5,313 1240 Receivables from Other Governments

- - - - 1250 Accrued Interest

309 - - - 1260 Due from Other Funds

- - - - 1290 Other Receivables

- - - - 1300 Inventories

Total Assets1000 42,208 4,459,675 72,422 5,313 $ $ $ $

LIABILITIES

33,291 - - - $ $ $ $2110 Accounts Payable

1,204,267 6,025 1,016 - 2160 Accrued Wages Payable

3,222,117 36,183 71,406 5,313 2170 Due to Other Funds

- - - - 2180 Due to Other Governments

- - - - 2300 Unearned Revenues

Total Liabilities2000 42,208 4,459,675 72,422 5,313

FUND BALANCES

Nonspendable Fund Balance:

- - - - 3410 Inventories

- - - - 3415 Long-Term Loans/Notes Receivable

Restricted Fund Balance:

- - - - 3450 Federal or State Funds Grant Restriction

- - - - 3490 Other Restricted Fund Balance

Committed Fund Balance:

- - - - 3545 Other Committed Fund Balance

Total Fund Balances3000 - - - -

4000 Total Liabilities and Fund Balances 42,208 4,459,675 72,422 5,313 $ $ $ $

104

EXHIBIT H-1 (Cont'd)

IDEA

Part B

Preschool

Part B

IDEA

Lunch Program

Breakfast and

National

Program

Feeding

Summer Career and

Technical -

Basic Grant

ESEA II,A

Training and

Recruiting

Medicaid

Admin. Claim

MAC

Title III, A

English Lang.

Acquisition

224 225 240 242 244 255 263 272

Formula

- - - - 10 5,416,846 - 560,897 $ $ $ $ $ $ $ $

- - - - - 5,718,376 - -

56,095 - 356,269 1,660,430 49,386 139,550 179,074 82,472

- - - - - 15,822 - -

22,093 42,803 - 1,176,931 17,446 14,275 1 -

67 - - - - 2,060 - 29

- - - - - 1,428,438 - -

2,837,361 66,842 12,735,367 42,803 78,255 356,269 179,075 643,398 $ $ $ $ $ $ $ $

119 - 2,890 7,085 - 218,257 4,200 31,757 $ $ $ $ $ $ $ $

6 - 92,531 769,443 19,957 27,883 23,725 -

77,652 33,255 260,848 2,060,833 46,885 2,379,697 151,150 9,982

- - - - - - - -

478 - - - - 882,345 - -

2,837,361 66,842 3,508,182 33,255 78,255 356,269 179,075 41,739

- - - - - 51,430 - -

- - - - - - - -

- 9,548 - - - 9,175,755 - 601,659

- - - - - - - -

- - - - - - - -

- - 9,227,185 9,548 - - - 601,659

2,837,361 66,842 12,735,367 42,803 78,255 356,269 179,075 643,398 $ $ $ $ $ $ $ $

105



JUNE 30, 2015

Control

Data

Codes

Other Federal

Special

Revenue Funds Discretionary

IDEA, Part B

SSA

Deaf

IDEA, Part B

SSA

Deaf

Preschool

SSA - IDEA, B

289 315 316 317

ASSETS

- 16,778 - - Cash and Cash Equivalents $ $ $ $1110

- - - - Investments - Current1120

2,026 49,674 49 - Receivables from Other Governments1240

- - - - Accrued Interest1250

29,589 335 19,003 - Due from Other Funds1260

- - - - Other Receivables1290

- - - - Inventories1300

Total Assets1000 66,787 31,615 19,052 - $ $ $ $

LIABILITIES

- - - - Accounts Payable $ $ $ $2110

- - - - Accrued Wages Payable2160

31,615 64,201 17,199 - Due to Other Funds2170

- - - - Due to Other Governments2180

- 2,586 1,853 - Unearned Revenues2300

Total Liabilities2000 66,787 31,615 19,052 -

FUND BALANCES



- - - - Long-Term Loans/Notes Receivable3415


- - - - Federal or State Funds Grant Restriction3450

- - - - Other Restricted Fund Balance3490


- - - - Other Committed Fund Balance3545

Total Fund Balances3000 - - - -

4000 Total Liabilities and Fund Balances 66,787 31,615 19,052 - $ $ $ $

106


SSA - IDEA C

Deaf - Early

State

Education

Adult Basic

SSVI

Impaired

Visually

Based Support

Community

Non-Ed. Advanced

Placement

Incentives

High School

Completion

and Success

Master

Reading

Teacher

State

Textbook

Fund

340 381 385 392 397 409 410 421

Intervention

43,530 - 30 - - - 636,532 513 $ $ $ $ $ $ $ $

- - - - - - - -

- 2,673 - - 13,006 13,507 125,935 -

- - - - - - - -

- - - - 18 630 6,933 -

- - - - - - - -

- - - - - - - -

- 13,024 14,137 2,673 43,530 30 769,400 513 $ $ $ $ $ $ $ $

- 495 - - - - 4,117 - $ $ $ $ $ $ $ $

- - - - 1 2,133 21,238 -

525 2,178 - - 13,023 12,004 22,882 -

- - 30 - - - - 513

43,005 - - - - - 721,163 -

- 13,024 14,137 2,673 43,530 30 769,400 513

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- 13,024 14,137 2,673 43,530 30 769,400 513 $ $ $ $ $ $ $ $

107



JUNE 30, 2015

Control

Data

Codes

Other

State

Awards Revenue Funds

Special

Other State

School - Deaf

Regional Day

SSA

Funds

Activity

Campus

427 429 435 461

ASSETS

- - - 3,542,247 Cash and Cash Equivalents $ $ $ $1110

- - - - Investments - Current1120

10,703 3,353 - - Receivables from Other Governments1240

- - - - Accrued Interest1250

17,564 - 377,181 - Due from Other Funds1260

264 - - - Other Receivables1290


Total Assets1000 3,353 28,531 377,181 3,542,247 $ $ $ $

LIABILITIES

- - - - Accounts Payable $ $ $ $2110

- - 125,188 - Accrued Wages Payable2160

23,802 3,353 251,993 257,993 Due to Other Funds2170

- - - - Due to Other Governments2180

4,729 - - - Unearned Revenues2300

Total Liabilities2000 3,353 28,531 377,181 257,993

FUND BALANCES



- - - - Long-Term Loans/Notes Receivable3415


- - - - Federal or State Funds Grant Restriction3450

- - - - Other Restricted Fund Balance3490


- - - 3,284,254 Other Committed Fund Balance3545

Total Fund Balances3000 - - - 3,284,254

4000 Total Liabilities and Fund Balances 3,353 28,531 377,181 3,542,247 $ $ $ $

108

EXHIBIT H-1

Coalition of

Essential

Awards

Local

Other

Society

Asia

Rackspace

HEB/ Nonmajor

Special

Revenue Funds

Permanent

Fund

Scholarships

Nonmajor

Governmental

Funds

485 486 489 490 Total 479 Total

Schools

10,240,889 - 36,132 1,070 - 22,436 10,277,021 $ $ $ $ $ $ $

5,718,376 - 186,906 - - - 5,905,282

7,323,511 - - - - - 7,323,511

15,822 - 2,210 - - - 18,032

1,789,823 - - - 64,712 - 1,789,823

17,314 14,894 - - - - 17,314

1,428,438 - - - - - 1,428,438

1,070 64,712 22,436 14,894 26,534,173 225,248 26,759,421 $ $ $ $ $ $ $

302,211 - - - - - 302,211 $ $ $ $ $ $ $

2,293,413 - - - - - 2,293,413

9,132,626 13,735 - - 62,802 - 9,132,626

543 - - - - - 543

1,682,734 1,159 - 1,070 1,910 22,436 1,682,734

1,070 64,712 22,436 14,894 13,411,527 - 13,411,527

51,430 - - - - - 51,430

- - 200,000 - - - 200,000

9,786,962 - - - - - 9,786,962

- - 25,248 - - - 25,248

3,284,254 - - - - - 3,284,254

- - - - 13,122,646 225,248 13,347,894

1,070 64,712 22,436 14,894 26,534,173 225,248 26,759,421 $ $ $ $ $ $ $

109


COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES INFUND BALANCES - NONMAJOR GOVERNMENTAL FUNDS


Control

Data

Codes

ESEA

Title X, Pt.C

Homeless Basic Program

Improving

ESEA I, A

Federal

Education

Adult

Assistance

Family

TANF

206 211 220 223

REVENUES:160 - - - Local and Intermediate Sources5700 $ $ $ $

- - - - State Program Revenues580012,117,724 109,647 268,022 38,606 Federal Program Revenues5900

Total Revenues5020 109,647 12,117,884 268,022 38,606

EXPENDITURES:

Current:8,251,674 - 256,844 38,606 Instruction0011

24,301 - - - Instructional Resources and Media Services00121,526,618 - 2,674 - Curriculum and Instructional Staff Development0013

315,441 19,423 8,504 - Instructional Leadership002174,442 - - - School Leadership002318,446 - - - Guidance, Counseling and Evaluation Services0031

1,585,188 74,337 - - Social Work Services003243,227 - - - Health Services003360,078 - - - Student Transportation0034

- - - - Food Services0035 - - - - Extracurricular Activities0036 - - - - General Administration0041

482 - - - Facilities Maintenance and Operations005118,936 - - - Security and Monitoring Services0052

199,051 15,887 - - Community Services0061

Capital Outlay: - - - - Facilities Acquisition and Construction0081

Total Expenditures6030 109,647 12,117,884 268,022 38,606


- - - -

OTHER FINANCING SOURCES (USES): - - - - Sale of Real and Personal Property7912 - - - - Transfers In7915 - - - - Transfers Out (Use)8911

Total Other Financing Sources (Uses) 7080 - - - -

1200 Net Change in Fund Balance - - - -

0100 Fund Balance - July 1 (Beginning) - - - -

3000 Fund Balance - June 30 (Ending) $ - $ - $ - $ -

110


IDEA

Part B

Formula Preschool

Part B

IDEA

Lunch ProgramBreakfast and

National

Program

Feeding

Summer

224 225 240 242 272

Medicaid

Admin. Claim

MAC

263

Title III, A

English Lang.

Acquisition

255

ESEA II,A

Training and

Recruiting

244

Career and

Technical -

Basic Grant

- - 12,886,467 2,735 - - - - $ $ $ $ $ $ $ $ - - 466,741 - - - - -

207,157 10,503,061 20,134,260 152,142 148,611 912,919 1,241,086 711,091

10,503,061 207,157 33,487,468 154,877 148,611 912,919 1,241,086 711,091

207,157 7,730,724 - - - 307,306 170,057 631,099 - - - - - - - - - 229,298 - - - 587,593 1,060,455 36,980 - 655,674 - - - - 10,574 20,203 - - - - - 7,549 - - - 1,766,364 - - - - - -

- - - - - - - - - 68,666 - - - - - - - - - - - 9,771 - - - - 30,735,933 145,329 - - - - - 42,342 - - - - - 22,809 - - - - 149,022 - - - - - 1,863,166 - - 700 - - - 6,102 97,968 - - - - - - 3,891 - - - - - -

- - - - - - - -

10,503,061 207,157 32,697,067 145,329 149,022 912,919 1,241,086 711,091

- - 790,401 9,548 - - - (411)

- - 10,964 - - - - -

- - 600 - - - - - - - - - - - - -

- - 11,564 - - - - -

- - 801,965 9,548 - - - (411)

- - 8,425,220 - - - - 602,070

$ - $ - $ 9,227,185 $ 9,548 $ - $ - $ - $ 601,659

111




Control

Data

Codes

Other Federal

Special

Revenue Funds Discretionary

IDEA, Part B

SSA

Deaf

IDEA, Part B

SSA

Deaf

Preschool

SSA - IDEA, B

289 315 316 317

REVENUES: - - 4,848 - Local and Intermediate Sources5700 $ $ $ $ - - - - State Program Revenues5800

46,081 63,987 58,667 6,395 Federal Program Revenues5900

Total Revenues5020 63,987 46,081 63,515 6,395

EXPENDITURES:

Current:46,081 14,313 63,515 6,395 Instruction0011

- - - - Instructional Resources and Media Services0012 - - - - Curriculum and Instructional Staff Development0013 - - - - Instructional Leadership0021 - - - - School Leadership0023 - - - - Guidance, Counseling and Evaluation Services0031 - - - - Social Work Services0032 - - - - Health Services0033 - - - - Student Transportation0034 - 49,674 - - Food Services0035 - - - - Extracurricular Activities0036 - - - - General Administration0041 - - - - Facilities Maintenance and Operations0051 - - - - Security and Monitoring Services0052 - - - - Community Services0061


Total Expenditures6030 63,987 46,081 63,515 6,395


- - - -

OTHER FINANCING SOURCES (USES): - - - - Sale of Real and Personal Property7912 - - - - Transfers In7915 - - - - Transfers Out (Use)8911

Total Other Financing Sources (Uses) 7080 - - - -

1200 Net Change in Fund Balance - - - -

0100 Fund Balance - July 1 (Beginning) - - - -

3000 Fund Balance - June 30 (Ending) $ - $ - $ - $ -

112


SSA - IDEA C

Deaf - Early

Intervention State

Education

Adult Basic

SSVI

Impaired

Visually

Based Support

Community

Non-Ed.

340 381 385 392 421

Master

Reading

Teacher

410

State

Textbook

Fund

409

High School

Completion

and Success

397

Advanced

Placement

Incentives

- - - - - 23,965 - - $ $ $ $ $ $ $ $49,308 - 48,726 2,673 - 7,810,205 - 14,264

- 364 - - - - - -

364 49,308 48,726 2,673 - 7,834,170 - 14,264

40,905 364 48,726 2,673 - 7,559,021 - 1,439 - - - - - - - -

2,887 - - - - 275,149 - 12,825 5,516 - - - - - - -

- - - - - - - - - - - - - - - -

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

- - - - - - - -

364 49,308 48,726 2,673 - 7,834,170 - 14,264

- - - - - - - -

- - - - - - - -

- - - - - - - - - - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- $ - $ - $ - $ - $ - $ - $ - $

113




Control

Data

Codes

Other

State

Awards Revenue Funds

Special

Other State

School - Deaf

Regional Day

SSA

Funds

Activity

Campus

427 429 435 461

REVENUES: - - 531,752 6,651,902 Local and Intermediate Sources5700 $ $ $ $

79,087 3,353 567,521 - State Program Revenues580055,181 - - - Federal Program Revenues5900

Total Revenues5020 3,353 134,268 1,099,273 6,651,902

EXPENDITURES:

Current: - 3,353 1,070,937 6,081,437 Instruction0011

157 - - - Instructional Resources and Media Services0012 - - - - Curriculum and Instructional Staff Development0013

16,048 - 301 - Instructional Leadership0021 - - - - School Leadership0023 - - 28,035 - Guidance, Counseling and Evaluation Services0031 - - - - Social Work Services0032 - - - - Health Services0033 - - - - Student Transportation0034 - - - - Food Services0035 - - - - Extracurricular Activities0036 - - - - General Administration0041 - - - - Facilities Maintenance and Operations0051

4,365 - - - Security and Monitoring Services0052113,698 - - - Community Services0061


Total Expenditures6030 3,353 134,268 1,099,273 6,081,437


- - - 570,465

OTHER FINANCING SOURCES (USES): - - - - Sale of Real and Personal Property7912 - - - - Transfers In7915 - - - (195,126)Transfers Out (Use)8911

Total Other Financing Sources (Uses) 7080 - - - (195,126)

1200 Net Change in Fund Balance

0100 Fund Balance - July 1 (Beginning)

3000 Fund Balance - June 30 (Ending)

- - - 375,339

2,908,915

3,284,254 $

-

$ -

-

$ -

-

$ -

114

EXHIBIT H-2

Coalition of

Essential

Schools Awards

Local

Other

Society

Asia

Rackspace

HEB/

485 486 489 490 Total

Nonmajor

Governmental

Funds

479

Permanent

Fund

Scholarships

Total

Nonmajor

Special

Revenue Funds

101,098 - 4,549 - 20,214,998 7,522 20,207,476 $ $ $ $ $ $ $ - - 2 - 9,041,880 - 9,041,880 - - - - 46,775,001 - 46,775,001

- 101,098 4,551 - 76,031,879 7,522 76,024,357

1,996 - 3,089 - 32,537,711 - 32,537,711 - - - - 24,458 - 24,458 - - 1,462 11,962 3,747,903 - 3,747,903 - - - - 1,051,684 - 1,051,684 - - - 25,507 107,498 - 107,498 - - - - 1,812,845 - 1,812,845

- - - - 1,659,525 - 1,659,525 - - - - 111,893 - 111,893 - - - - 69,849 - 69,849 - - - - 30,930,936 - 30,930,936 - - - - 65,151 - 65,151 - - - - 149,022 - 149,022 - - - - 1,864,348 - 1,864,348 - - - - 127,371 - 127,371 - - - - 332,527 - 332,527

99,102 - - - 99,102 - 99,102

- 101,098 4,551 37,469 74,691,823 - 74,691,823

- - - (37,469) 1,332,534 7,522 1,340,056

- - - - 10,964 - 10,964

- - - - 600 - 600 - - - - (195,126) - (195,126)

- - - - (183,562) - (183,562)

- - - (37,469) 1,148,972 7,522 1,156,494

- - - 37,469 11,973,674 217,726 12,191,400

$ 13,347,894 $ 225,248 $ 13,122,646 $ - $ - $ - $ -

115

116




Fund Descriptions

117

The Internal Service Funds are used to account for the financing of goods and services provided by certain departments in the District to other departments in the District on a cost-reimbursement basis. Document Management & Printing Services Fund accounts for the operations of the District’s Document Management Department. Revenue is comprised of user charges from the various campuses and departments within the District. (Fund 752) Health Insurance Fund accounts for the operations of the District’s self-funded medical programs, including the state-mandated medical plan comparable to the TRS health plan. Contributions are collected from the employees of the District along with amounts contributed from various District accounts. Claim costs, administrative costs, stop-loss premiums, hospital indemnity claims, employee assistance program fees, and employee term-life insurance are paid from the proceeds of the premiums collected. Excess claims are covered by a stop-loss carrier. (Fund 753) Data Processing Center Fund accounts for the operations of the District’s Data Processing Department. Revenue is comprised of user charges from the various departments within the District. (Fund 754) Network Technology Services Fund accounts for the operations of the District’s network infrastructure and the maintenance and repair of computers across the District. Revenue is comprised of user charges from the various departments within the District. (Fund 755) Dental Insurance Fund accounts for the operations of the District’s self-funded dental insurance plan. Participation is voluntary and contributions are collected from employees of the District. Claim costs, administrative costs, and vision discount program fees are paid from the proceeds of the contributions collected. Excess claims are the responsibility of the employees. (Fund 773) Rolling Owner Controlled Insurance Program Fund accounts for the operations of the District’s ROCIP that covers several construction projects over a period of years. The ROCIP allows the District to purchase a large package of insurance at lower premiums. This insurance covers the owner, contractors, and subcontractors working on the construction projects. Insurance coverage provided under the ROCIP includes on-site workers’ compensation, general liability, excess liability, and builder’s risk. The cost of on-site insurance coverage for the contractors is paid for through the deduction of the insurance cost contractors would have passed on to the District for the various construction projects under the 1998 and 2003 Bond construction programs. (Fund 792)



Fund Descriptions

118

Workers’ Compensation Insurance Fund accounts for the operations of the District’s self-funded, self-administered program that meets the state mandate that all District employees be covered by workers’ compensation insurance. Premiums are collected from each department of the District. Claim costs, administrative costs, and stop-loss insurance premiums are paid from the premiums collected. Excess claims are covered by an outside insurance company. (Fund 793) Unemployment Compensation Insurance Fund accounts for the operations of the District’s self-funded, self-administered program that meets the state mandate that all District employees be covered by unemployment compensation insurance. Premiums are collected from each department of the District. Claim costs, administrative costs, and stop-loss insurance premiums are paid from the premiums collected. Excess claims are covered by an outside insurance company. (Fund 795) Police Services Fund accounts for the operations of the District’s police force. Revenue is comprised of user charges from the various campuses and departments within the District. (Fund 796)

119



COMBINING STATEMENT OF NET POSITIONINTERNAL SERVICE FUNDS

JUNE 30, 2015

Document

Management &

Print Svc

Insurance

Health

752 753


6,263,570 1,472,163 Cash and Cash Equivalents $ $5,263,074 - Investments - Current

338 - Due from Other Governments26,303 - Accrued Interest

5,436,663 79,674 Due from Other Funds4,060 18,922 Other Receivables

- 700,575 Inventories

2,271,334 16,994,008 Total Current Assets

Noncurrent Assets:Capital Assets:

- - Buildings and Improvements - - Depreciation on Buildings - 3,665,219 Furniture and Equipment

- (2,919,142)Depreciation on Furniture and Equipment

746,077 - Total Noncurrent Assets

Total Assets 3,017,411 16,994,008

LIABILITIESCurrent Liabilities:

297,545 6,160 Accounts Payable - - Short Term Workers Compensation Payable

168 13,347 Accrued Wages Payable363,640 730,306 Due to Other Funds

- 187 Due to Other Governments4,012,165 - Accrued Expenses

750,000 4,673,518 Total Current Liabilities

Noncurrent Liabilities: - - Workers Compensation - Due in More than One Year

- - Total Noncurrent Liabilities

Total Liabilities 750,000 4,673,518

NET POSITION - 746,077 Net Investment in Capital Assets

12,320,490 1,521,334 Unrestricted Net Position

Total Net Position 2,267,411 12,320,490 $ $

120

EXHIBIT H-3

Data

Processing

Services

Technology

Network

Insurance

Dental

Insurance Prg

Controlled

Rolling Owner Workers

Compensation

Insurance

Unemployment

Compensation

Insurance

Total

Internal

Service Funds

Police

Services

Center

754 755 773 792 793 795 796

1,927,276 950,926 296,939 3,516,308 3,619,097 672,167 668,798 19,387,244 $ $ $ $ $ $ $ $871,923 - - - - 828,773 - 6,963,770

- - - - - - - 338 3,208 - - - - 8,349 - 37,860

7,398 - - 3,798,811 90,750 310,518 157,380 9,881,194 - - - - 314,218 - 2,491 339,691 - - - 192,018 29,136 - - 921,729

7,507,137 4,053,201 1,819,807 950,926 2,809,805 296,939 828,669 37,531,826

- - - - 483,379 - - 483,379 - - - - (373,207) - - (373,207)

30,528 - - 11,481,152 2,172,873 - 1,156,359 18,506,131

(30,528) - - (4,584,346) (1,874,458) - (764,838) (10,173,312)

6,896,806 408,587 - - - - 391,521 8,442,991

14,403,943 4,461,788 1,819,807 950,926 2,809,805 296,939 1,220,190 45,974,817

22,393 - - 16,539 6,808 - 7,201 356,646 300,000 - - - - - - 300,000

352 - - 163 1,948 - 211 16,189 123,631 - - 352,414 475,784 - 489,081 2,534,856

- - - - - - - 187 - - - - - 280,624 - 4,292,789

369,116 484,540 280,624 - 446,376 - 496,493 7,500,667

756,111 - - - - - - 756,111

- - - - 756,111 - - 756,111

369,116 484,540 280,624 - 1,202,487 - 496,493 8,256,778

- - - 6,896,806 408,587 - 391,521 8,442,991 1,607,318 950,926 296,939 7,138,021 3,568,661 1,539,183 332,176 29,275,048

14,034,827 3,977,248 1,539,183 950,926 1,607,318 296,939 723,697 37,718,039 $ $ $ $ $ $ $ $

121


COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITIONINTERNAL SERVICE FUNDS


Document

Management &

Print Svc

Insurance

Health

752 753

OPERATING REVENUES:

57,902,736 3,595,645 Local and Intermediate Sources $ $4,158 101,476 State Program Revenues

- - Federal Revenues

Total Operating Revenues 3,697,121 57,906,894

OPERATING EXPENSES:

170,293 1,557,536 Payroll Costs3,003,546 299,460 Professional and Contracted Services

31,689 1,299,406 Supplies and Materials52,572,952 23,995 Other Operating Costs

- 186,679 Depreciation Expense

Total Operating Expenses 3,367,076 55,778,480

Operating Income (Loss) 330,045 2,128,414


- - Gain in Sale of Real and Personal Property20,293 - Earnings from Temporary Deposits & Investments

- - (Loss) on Sale of Real and Personal Property

Total Nonoperating Revenues (Expenses) - 20,293

Income (Loss) Before Transfers 330,045 2,148,707

- 210,000 Transfer In




540,045

1,727,366

$ 2,267,411

2,148,707

10,171,783

$ 12,320,490

122

EXHIBIT H-4

Processing

Center Services

Technology

Network

Insurance

Dental

Insurance Prg

Controlled

Rolling Owner Workers

Compensation

Insurance

Unemployment

Compensation

Insurance

Police Total

Services Internal

Service Funds

Data

754 755 773 792 793 795 796

3,659,728 4,411,927 3,678,619 333,160 1,033,173 $ $ $ $ $ 150,159 $ 4,375,704 79,140,851 $ $181,389 152,357 - - 34,113 - 277,740 751,233 612,374 354,380 - - - - - 966,754

4,918,664 4,453,491 3,678,619 333,160 1,067,286 150,159 4,653,444 80,858,838

2,757,337 2,207,492 - - 520,040 - 4,208,783 11,421,481 238,323 685,529 192,602 - 563,562 - 98,662 5,081,684 571,885 159,815 - - 8,477 - 145,468 2,216,740 50,770 25,316 3,156,000 - 340,775 133,617 5,739 56,309,164

228,659 1,364,071 - - - - 105,576 1,884,985

4,442,223 3,846,974 3,348,602 - 1,432,854 133,617 4,564,228 76,914,054

476,441 606,517 330,017 333,160 (365,568) 16,542 89,216 3,944,784

189 - - - - - 833 1,022 - - 787 - 6,351 - - 27,431

(9,197) - - - - - - (9,197)

- (9,008) 787 - 6,351 - 833 19,256

476,441 597,509 330,804 333,160 (359,217) 16,542 90,049 3,964,040

- 1,143,000 - - - - 120,000 1,473,000

1,619,441

12,415,386

$ 14,034,827

597,509

3,379,739

$ 3,977,248

330,804

1,208,379

$ 1,539,183

333,160

617,766

$ 950,926

(359,217)

1,966,535

$ 1,607,318

16,542

280,397

$ 296,939

210,049

513,648

$ 723,697

5,437,040

32,280,999

$ 37,718,039

123


COMBINING STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED JUNE 30, 2015INTERNAL SERVICE FUNDS

Document Health Data Network

Management & Insurance Processing Technology

Print Svc Center Services

752 753 754 755

Cash Flows from Operating Activities:

56,095,771 3,686,566 4,767,807 4,250,004 Cash Received from User Charges $ $ $ $

(165,967)(1,453,142) (2,056,348) (2,574,000)Cash Payments to Employees for Services(51,835,504) - - - Cash Payments for Insurance Claims(3,750,295)(1,778,513) (942,673) (653,634)Cash Payments to Suppliers

(705,283) - - - Cash Payments for Other Operating Expenses - - (3,808,054) - Cash Payments to Other Funds - Operating

454,911 Net Cash Provided by (Used for) Operating

(361,278) (2,039,268) 1,022,370 Activities

Cash Flows from Non-Capital Financing Activities:

- 210,000 1,143,000 - Transfers In

Cash Flows from Capital & Related Financing Activities:

- (68,698) (915,838) (148,438)Acquisition of Capital Assets - - - 270 Gain on Sale of Capital Assets

(68,698)Net Cash Used For Capital and

- (915,838) (148,168)Related Financing Activities

Cash Flows from Investing Activities:

(3,815,000) - - - Purchase of Investment Securities1,582,818 - - - Proceeds from Sale & Maturities of Securities

27,846 - - - Interest and Dividends on Investments

- Net Cash Provided by (Used for) Investing

(2,204,336) - - Activities

Net Increase (Decrease) in Cash and Cash Equivalents 596,213 (2,565,614) (1,812,106) 874,202

Cash and Cash Equivalents at Beginning of Year 875,950 8,829,184 5,328,414 2,744,895

Cash and Cash Equivalents at End of Year 1,472,163 6,263,570 3,516,308 3,619,097 $ $ $ $

124


Dental Rolling Owner Workers Unemployment

Insurance Controlled Compensation Compensation

Insurance Prg Insurance Insurance

773 792 793 795 796

Police

Services

Total

Internal

Service Funds

78,642,063 3,678,619 333,160 1,114,695 150,159 4,565,282 $ $ $ $ $ $

(10,665,849) - - (485,575) - (3,930,817)

(55,120,427)(3,451,291) - 299,985 (133,617) -

(8,959,622)(212,624) - (1,377,692) - (244,191)(705,283) - - - - -

(3,808,054) - - - - -

14,704 (617,172)333,160 (448,587) 16,542 390,274

1,473,000 - - - - 120,000

(1,326,165) - - - - (193,191)1,103 - - - - 833

- (1,325,062) - - - (192,358)

(5,485,000)(325,000) - (1,345,000) - -

3,989,486 109,138 - 2,297,530 - -

35,065 467 - 6,752 - -

(215,395) (1,460,449) - 959,282 - -

(200,691) (1,929,683)

872,858 21,316,927

672,167 19,387,244 $ $$

333,160

617,766

950,926

510,695

1,416,581

1,927,276 $ $

16,542

280,397

296,939 $

317,916

350,882

668,798

125



FOR THE YEAR ENDED JUNE 30, 2015INTERNAL SERVICE FUNDS

Document Health Data Network

Management & Insurance Processing Technology

Print Svc Center Services

752 753 754 755

Operating Income (Loss): $ $ $ $

Reconciliation of Operating Income (Loss) to Net Cash

Provided by (Used for) Operating Activities:

330,045 2,128,414 476,441 606,517


- 186,679 1,364,071 228,659 Depreciation


(708)(150) 1,500 (235,816)Decrease (increase) in Receivables - (128,326) (4,825) 264,306 Decrease (increase) in Inventories

2,378,181 (71,722) (3,796,489) (90,546)Decrease (increase) in Due From Other Funds(715,060)(27,326) (67,188) (56,962)Increase (decrease) in Accounts Payable

- 131 - - Increase (decrease) in Due to Other Governments168 2,918 (1,213) 1,948 Increase (decrease) in Accrued Wages Payable

363,640 162,662 (11,565) 304,264 Increase (decrease) in Due to Other Funds(4,548,078) - - - Increase (decrease) in Unearned Revenues

32,165 - - - Increase (decrease) in Accrued Expenses - - - - Increase (decrease) in Workers Comp Payable

Net Cash Provided by (Used for)(361,278) (2,039,268) 1,022,370 Operating Activities 454,911 $ $ $ $

126

Exhibit H-5

Dental Rolling Owner Workers Unemployment

Insurance Controlled Compensation Compensation

Insurance Prg Insurance Insurance

773 792 793 795 796

Police

Services

Total

Internal

Service Funds

$ $330,017 3,944,784 $ 333,160 (365,568)$ $ 16,542 $ 89,216

1,884,985 - - - - 105,576

(243,822) - - (7,395) - (1,253)

131,155 - - - - -

(2,029,312)(295,136) - - - (153,600)

(902,692)(646) - (41,188) - 5,678 131 - - - - -

4,399 - - 352 - 226

1,252,194 (155) - 88,917 - 344,431

(4,548,078) - - - - -

12,789 (19,376) - - - -

(123,705) - - (123,705) - -

(617,172)14,704 333,160 (448,587) 16,542 390,274 $$$$$$

127

128



Enterprise Funds

Fund Descriptions

129

The Enterprise Funds are used to account for the financing or recovery of costs of providing goods and services to the general public on a continuing basis primarily through user charges. Property Management Fund accounts for the revenues and expenditures associated with the rental of District facilities and the sale of disposed items. (Fund 711) Uniform Rental Fund accounts for the rental of uniforms. Revenue is comprised of user charges from band, orchestra, spirit, and choir groups. (Fund 713) Community Education Fund accounts for services provided to the community for after school childcare and community education classes. Revenue is comprised of user charges from the community and after school tuition fees. (Fund 714) Preschool Program for Children with Disabilities (PPCD) Fund accounts for the operations of the PPCD program which provides daycare services for children with disabilities. (Fund 715) North East Aquatics and Tennis (NEAT) Fund accounts for the North East Aquatics and Tennis Center’s operations. Revenue is comprised of user charges from team activities. (Fund 721)


COMBINING STATEMENT OF NET POSITIONNONMAJOR ENTERPRISE FUNDS

JUNE 30, 2015

Property

Management Rental

Uniform

711 713


318,958 1,315,803 Cash and Cash Equivalents $ $8,088 316 Due from Other Funds

- 50,454 Other Receivables

1,366,573 327,046 Total Current Assets

Noncurrent Assets:

Capital Assets: - 1,585,748 Land - 4,400,529 Buildings and Improvements - (2,103,853)Depreciation on Buildings - 213,538 Furniture and Equipment - (135,067)Depreciation on Furniture and Equipment

3,960,895 - Total Noncurrent Assets

Total Assets 5,327,468 327,046

LIABILITIES

Current Liabilities: - 8,773 Accounts Payable - - Accrued Wages Payable

887 86,252 Due to Other Funds - 7,396 Due to Other Governments - - Due to Student Groups - - Unearned Revenues

Total Liabilities 102,421 887

NET POSITION - 3,960,895 Net Investment in Capital Assets

326,159 1,264,152 Unrestricted Net Position

Total Net Position 5,225,047 326,159 $ $

130

EXHIBIT H-6

Community

Education

Disabilities

Children w/

Preschool Prg

Tennis

Aquatics &

North East

Funds

Enterprise

Nonmajor

714 715 721 Total

5,218,504 2,299,510 180,007 1,104,226 $ $ $ $248,140 232,454 7,256 26 113,068 30,113 485 32,016

2,562,077 187,748 1,136,268 5,579,712

2,547,600 961,852 - - 10,325,760 5,499,647 - 425,584 (3,751,357)(1,626,476) - (21,028)

525,893 59,573 - 252,782 (292,605)(20,010) - (137,528)

4,874,586 - 519,810 9,355,291

7,436,663 187,748 1,656,078 14,935,003

42,921 28,076 - 6,072 90,733 2,593 88,107 33

964,911 745,965 50,892 80,915 7,396 - - -

13,970 13,970 - - 81,085 50,155 22,820 8,110

840,759 161,819 95,130 1,201,016

9,355,291 4,874,586 - 519,810 4,378,696 1,721,318 25,929 1,041,138

6,595,904 25,929 1,560,948 13,733,987 $ $ $ $

131


COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITIONNONMAJOR ENTERPRISE FUNDS


Property

Management Rental

Uniform

711 713

OPERATING REVENUES:

63,227 452,678 Local and Intermediate Sources $ $ - 21,840 State Program Revenues

Total Operating Revenues 474,518 63,227

OPERATING EXPENSES:

- 387,484 Payroll Costs1,309 69,342 Professional and Contracted Services

115,399 22,379 Supplies and Materials - 39,385 Other Operating Costs - 215,631 Depreciation Expense

Total Operating Expenses 734,221 116,708

Operating Income (Loss) (259,703) (53,481)


- 128,218 Gain in Sale of Real and Personal Property - - Non-operating Expenses

Total Nonoperating Revenues (Expenses) 128,218 -

Income (Loss) Before Transfers (131,485) (53,481)

- (565,059)Transfers Out




(696,544)

5,921,591

$ 5,225,047

(53,481)

379,640

$ 326,159

132

EXHIBIT H-7

Education

Disabilities

Children w/

Preschool Prg

Tennis

Aquatics &

North East

Funds

Enterprise

NonmajorCommunity

714 715 721 Total

561,648 8,325,822 802,670 10,206,045 $ $ $ $38,962 358,999 2,597 422,398

8,684,821 600,610 805,267 10,628,443

636,631 6,272,079 331,455 7,627,649 70 681,318 138,175 890,214

150 384,903 73,713 596,544 10,161 463,734 157,840 671,120

- 191,869 70,314 477,814

7,993,903 647,012 771,497 10,263,341

690,918 (46,402) 33,770 365,102

- - - 128,218 - (6,459) - (6,459)

(6,459) - - 121,759

684,459 (46,402) 33,770 486,861

- (1,395,535) - (1,960,594)

(711,076)

7,306,980

$ 6,595,904

(46,402)

72,331

$ 25,929

33,770

1,527,178

$ 1,560,948

(1,473,733)

15,207,720

$ 13,733,987

133



FOR THE YEAR ENDED JUNE 30, 2015NONMAJOR ENTERPRISE FUNDS

Property Uniform

Management Rental

711 713

Cash Flows from Operating Activities:

63,226 466,479 Cash Received from User Charges $ $

- (392,639)Cash Payments to Employees for Services(116,707)(122,628)Cash Payments to Suppliers

(4,880)86,751 Cash Payments to Other Funds - Operating Expenses

37,963 Net Cash Provided by (Used for) Operating

(58,361)Activities

Cash Flows from Non-Capital Financing Activities:

- (565,059)Transfers Out - 128,218 Gain - Sale on Real Property Noncapital

(436,841)Net Cash Used for Non-Capital

- Financing Activities

Cash Flows from Capital & Related Financing Activities:

- (35,555)Acquisition of Capital Assets - - Nonoperating Expenses

(35,555)Net Cash Used for Capital and

- Related Financing Activities

Net Decrease in Cash and Cash Equivalents (434,433) (58,361)

Cash and Cash Equivalents at Beginning of Year 1,750,236 377,319

Cash and Cash Equivalents at End of Year 1,315,803 318,958 $ $

134


Community Preschool Prg North East Nonmajor

Education Children w/ Aquatics & Enterprise

Disabilit ies Tennis Funds

714 715 721 Total

8,356,834 561,920 918,216 10,366,675 $ $ $ $

(5,916,782) (594,911) (329,434) (7,233,766)

(1,524,976) (10,381) (367,283) (2,141,975)

- (7,616) - 74,255

915,076 (50,988) 221,499 1,065,189

(1,395,535) - - (1,960,594) - - - 128,218

(1,395,535) - - (1,832,376)

(43,036) - (380,137) (458,728)

(6,459) - - (6,459)

(49,495) - (380,137) (465,187)

(529,954)

2,829,464

2,299,510 $ $

(50,988)

230,995

180,007

(158,638)

1,262,864

1,104,226 $ $

(1,232,374)

6,450,878

5,218,504

135



FOR THE YEAR ENDED JUNE 30, 2015NONMAJOR ENTERPRISE FUNDS

Property Uniform

Management Rental

711 713

Operating Income (Loss): $ $

Reconciliation of Operating Income (Loss) to Net Cash

Provided By (Used For) Operating Activities:

(259,703) (53,481)


- 215,631 Depreciation


- 6,255 Decrease (increase) in Receivables(5,767)499 Decrease (increase) in Due From Other Funds

- 8,477 Increase (decrease) in Accounts Payable - 7,396 Increase (decrease) in Due to Other Governments - (26,995)Increase (decrease) in Accrued Wages Payable

887 86,403 Increase (decrease) in Due to Other Funds - - Increase (decrease) in Unearned Revenues

Net Cash Provided by (Used for)Operating Activities $ 37,963 $ (58,361)

136

Exhibit H-8

Community Preschool Prg North East Nonmajor

Education Children w/ Aquatics & Enterprise

Disabilit ies Tennis Funds

714 715 721 Total

$ 690,918 $ (46,402) 33,770 $ $ 365,102

191,868 - 70,314 477,813

(6,033) - 42,198 42,420

(221,751) (7,256) (26) (234,301)

4,980 - 2,445 15,902

30,405 - (534) 37,267 (3,702) 3,028 (576) (28,245)

214,021 (8,780) 73,908 366,439

14,370 8,422 - 22,792

915,076 (50,988) 221,499 1,065,189 $$$$

137


Agency Funds

138

Agency Funds are used to account for assets held by the District as an agent for certain individuals and organizations. They are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations: Student Activity Fund is used to account for the receipt and disbursement of funds for the various student groups and organizations at each school campus. (Fund 865) Central Office Fund is used to account for the receipt and disbursement of funds for the special projects and programs of the Central Office staff. (Fund 893)

EXHIBIT H-9


COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

ALL AGENCY FUNDS


BALANCE

JULY 1

2014 ADDITIONS

DEDUCTIONS

2015

JUNE 30

BALANCE

STUDENT ACTIVITY ACCOUNTAssets:

146,399 2,242,049 272,414 Cash and Temporary Investments 2,116,034 $ $ $ $134,410 - - Due From Other Funds 134,410

Total Assets 2,242,049 280,809 272,414 2,250,444 $ $ $ $

Liabilities:27,609 22,861 24,363 Due to Other Funds 26,107 $ $ $ $

304,347 2,219,188 299,198 Due to Student Groups 2,224,337

Total Liabilities 2,242,049 331,956 323,561 2,250,444 $ $ $ $

CENTRAL OFFICEAssets:

550 15,707 376 Cash and Temporary Investments 15,881 $ $ $ $44,534 - 416 Due From Other Funds 44,118

- 110 - Other Receivables 110

Total Assets 15,817 45,084 792 60,109 $ $ $ $

Liabilities:44,118 15,345 90 Accounts Payable 59,373 $ $ $ $

416 - - Due to Other Funds 416 560 472 712 Due to Student Groups 320

Total Liabilities 15,817 45,094 802 60,109 $ $ $ $

TOTAL AGENCY FUNDSAssets:

146,949 2,257,756 272,790 Cash and Temporary Investments 2,131,915 $ $ $ $178,944 - 416 Due From Other Funds 178,528

- 110 - Other Receivables 110

Total Assets 2,257,866 325,893 273,206 2,310,553 $ $ $ $

Liabilities:44,118 15,345 90 Accounts Payable 59,373 $ $ $ $28,025 22,861 24,363 Due to Other Funds 26,523

304,907 2,219,660 299,910 Due to Student Groups 2,224,657

Total Liabilities 2,257,866 377,050 324,363 2,310,553 $ $ $ $

139

140


Schedules Required By the

Texas Education Agency


SCHEDULE OF DELINQUENT TAXES RECEIVABLE

FISCAL YEAR ENDED JUNE 30, 2015

Last 10 Years

Tax Rates

Debt ServiceMaintenance Tax Purposes

Value for School

Assessed/Appraised

(1) (2) (3)

VariousVariousand prior years2006 $ Various

0.3090001.360000 22,685,082,844 2007

0.3629001.040000 25,984,400,571 2008

0.3629001.040000 28,465,680,768 2009

0.3629001.040000 28,502,500,506 2010

0.3629001.040000 28,129,843,160 2011

0.3629001.040000 28,019,059,238 2012

0.3850001.040000 28,075,612,510 2013

0.4006001.040000 29,429,536,333 2014

0.4006001.040000 31,549,671,199 (School year under audit)2015

1000 TOTALS

Source: Bexar County Tax Assessor/Colector's Office

Current year adjustments must be applied to the tax levy after October 1st due to taxpayer protests and valuation adjustments

142

EXHIBIT J-1

7/1/2014

Balance

Beginning

Total Levy

Year's

Current

(20)(10) (50)

Ending

Balance

6/30/2015

(40)

Entire

Year's

Adjustments

(31)

Maintenance

Collections

(32)

Debt Service

Collections

- 2,032,962 108,584 (193,689)$ $ $ $ $ 1,713,084 $ 17,605

- 437,922 17,555 (2,749) 413,630 3,988

- 473,943 15,311 (2,967) 450,322 5,343

- 602,452 74,723 9,403 511,058 26,074

- 707,660 158,254 131,838 626,022 55,222

- 970,686 184,780 118,224 839,653 64,477

- 1,184,631 314,338 8,247 768,854 109,686

- 1,631,647 437,358 (29,186) 1,003,197 161,906

- 14,140,474 8,196,456 (1,240,187) 1,546,619 3,157,212

439,926,797 - 307,967,482 - 13,332,609 118,626,706

$ 21,205,048 $ (1,201,066)$ 317,474,841 $ 439,926,797 $ 22,182,377 $ 122,228,219

143

EXHIBIT J-2NORTH EAST INDEPENDENT SCHOOL DISTRICT

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL - NATIONAL SCHOOL BREAKFAST AND LUNCH PROGRAM


Control

Data

CodesOriginal Final

(GAAP BASIS)

(Negative)

Positive or


Budgeted Amounts

REVENUES:12,890,294 13,143,359 12,886,467 (3,827)Local and Intermediate Sources $ $ $ $5700

694,799 888,269 466,741 (228,058)State Program Revenues5800

20,134,243 20,119,257 20,134,260 17 Federal Program Revenues5900

Total Revenues5020 34,150,885 33,719,336 33,487,468 (231,868)

EXPENDITURES:32,577,062 32,838,062 30,735,933 1,841,129 Food Services0035

1,883,473 2,001,473 1,863,166 20,307 Facilities Maintenance and Operations0051

101,000 200,000 97,968 3,032 Security and Monitoring Services0052

Total Expenditures6030 35,039,535 34,561,535 32,697,067 1,864,468


(888,650) (842,199) 790,401 1,632,600

OTHER FINANCING SOURCES (USES): 11,550 - 10,964 (586)Sale of Real and Personal Property7912

- - 600 600 Transfers In7915

Total Other Financing Sources (Uses) 7080 - 11,550 11,564 14

1200 Net Change in Fund Balances (888,650) (830,649) 801,965 1,632,614


3000 Fund Balance - June 30 (Ending) $ 7,536,570 $ 7,594,571 $ 9,227,185 $ 1,632,614

144

EXHIBIT J-3NORTH EAST INDEPENDENT SCHOOL DISTRICT

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL - DEBT SERVICE FUND


Control

Data

CodesOriginal Final

(GAAP BASIS)

(Negative)

Positive or


Budgeted Amounts

REVENUES:121,678,640 121,678,640 122,723,287 1,044,647 Local and Intermediate Sources $ $ $ $5700

1,825,708 1,825,708 1,830,973 5,265 Federal Program Revenues5900

Total Revenues5020 123,504,348 123,504,348 124,554,260 1,049,912

EXPENDITURES:

Debt Service:52,580,000 48,005,000 52,580,000 - Principal on Long Term Debt0071

61,195,096 62,460,096 60,576,951 618,145 Interest on Long Term Debt0072

13,972,905 601,000 13,850,766 122,139 Bond Issuance Cost and Fees0073

Total Expenditures6030 111,066,096 127,748,001 127,007,717 740,284


12,438,252 (4,243,653) (2,453,457) 1,790,196

OTHER FINANCING SOURCES (USES): - - 533,930,000 533,930,000 Refunding Bonds Issued7901

1,700,000 73,700,000 1,700,000 - Transfers In7915

60,173,226 - 60,168,687 (4,539)Premium or Discount on Issuance of Bonds7916

(15,000) - (14,664) 336 Transfers Out (Use)8911

(590,729,434)(72,000,000) (590,396,103) 333,331 Payment to Bond Refunding Escrow Agent (Use)8940

Total Other Financing Sources (Uses) 7080 1,700,000 (528,871,208) 5,387,920 534,259,128

1200 Net Change in Fund Balances 14,138,252 (533,114,861) 2,934,463 536,049,324


3000 Fund Balance - June 30 (Ending) $ 108,486,049 $ (438,767,064) $ 97,282,260 $ 536,049,324

145

146



Statistical Section Overview

147

The statistical section is organized in five sections: • Financial Trends – Compiles information reported in the Comprehensive Annual

Financial Report over the past ten years. These schedules report how the District’s financial position has changed over time.

• Revenue Capacity Information – Provides information regarding the District’s major revenue sources (property taxes) and the stability/growth of revenue.

• Debt Capacity Information – Provides information on the District’s outstanding debt, the District’s ability to repay the debt, and its ability to issue additional debt if needed.

• Demographic and Economic Information – Provides information regarding the District’s socioeconomic environment; specifically, its taxpayers, employers, and the changes to those groups over the past ten years if possible.

• Operating Information – Provides information on the District’s employees, operations of the District, and facilities.

The driving force of the District over the past ten years has been the growth in both the student enrollment and in the population of its taxpayers. The growth has also led to increased property tax valuation. As enrollment has grown, the District has expanded the number of schools funded by issuing taxpayer approved bonds. The expenditures for debt have increased as a percentage of operating expenditures as the debt payments are scheduled over time. Capital expenditures have increased and decreased on an annual basis as construction projects have begun and ended. In fiscal year 2007, the District’s funding sources began a transition as a new State funding model was implemented. Property tax rates for maintenance and operations (M&O) were reduced by almost a third over a two-year period as the State of Texas’ funding model was changed thereby reducing local tax revenue. The State increased its funding to compensate for the reduced property taxes, but a revenue cap negates the effect of increased property tax values to the District.


Statistical Section Overview

148

The funding model created a targeted revenue that is a fixed dollar amount per weighted average daily attendance (WADA). Additional revenues are achieved by assessing a property tax rate greater than $1.00 per $100 of assessed property value. Certain elements of State funding are excluded from the target revenue calculation, including elements that are mandated for specific purposes and a partial State match of local taxes assessed greater than $1.00 per $100 of assessed value. For simplicity, all property tax revenue and State entitlements are shown in this schedule. The District cannot raise its M&O tax rate above $1.04 without voter approval. In subsequent years, TEA refined the funding formula including certain items in the base allocation and excluding others. TEA began calling the revenue target, Revenue at the Compressed Tax Rate (RACR). For fiscal year 2011-2012, TEA redefined the calculation of WADA to allocate the State’s $4 billion reduction in its funding of education to districts across the State. The change in the calculation of WADA eliminated comparability in the State’s funding on an annual basis and effectively changed the amount per WADA that a school district would receive. GASB Statement No. 54 was implemented in fiscal year 2010-2011. This statement standardizes the way that governmental entities record fund balances. The alternate presentation is illustrated in the Fund Balances, Governmental Funds – Last Ten Years schedule. GASB Statement No. 68 was implemented in fiscal year 2014-2015. This statement recognizes pension liability for amounts owed by the Teacher Retirement System of Texas and the associated pension expense. These amounts are due District employees upon retirement and are therefore only recognized in the government-wide financial statements.

149

Financial Trends


Net Position by Component Last Ten Years

(Unaudited)

150

2015 2014 2013 2012Governmental ActivitiesNet Investment in Capital Assets $ 337,201 $ 2,296,068 $ 22,021,582 $ 47,272,218Restricted 102,759,331 100,508,611 142,467,867 115,592,695Unrestricted 3,105,289 72,911,739 27,472,888 56,328,510Total Governmental

Activities Net Position 106,201,821 175,716,418 191,962,337 219,193,423

Business - Type ActivitiesNet Investment in Capital Assets 9,355,291 9,373,978 9,522,349 9,916,449Restricted - - - - Unrestricted 4,378,696 5,833,742 6,086,556 4,949,501Total Business - Type

Activities Net Position 13,733,987 15,207,720 15,608,905 14,865,950

Primary GovernmentNet Investment in Capital Assets 9,692,492 11,670,046 31,543,931 57,188,667Restricted 102,759,331 100,508,611 142,467,867 115,592,695Unrestricted 7,483,985 78,745,481 33,559,444 61,278,011Total Primary

Government Net Position $ 119,935,808 $ 190,924,138 $ 207,571,242 $ 234,059,373

Source: The District’s Statement of Net Position (Exhibit A – 1). Note: The negative amount for unrestricted net position in Business-Type Activities, for fiscal

year 2006, is due to the purchase of a building with an interfund loan from the General Fund.

151

2011 2010 2009 2008 2007 2006

$ (4,823,192) $ 19,928,986 $ 26,977,086 $ 4,429,727 $ 17,244,714 $ 30,736,726152,266,493 142,114,941 132,445,898 133,947,467 81,887,808 72,080,152

59,172,644 48,301,528 46,417,351 80,123,040 83,914,665 54,924,547

206,615,945 210,345,455 205,840,335 218,500,234 183,047,187 157,741,425

10,307,998 10,616,869 10,936,825 11,174,285 10,630,346 9,948,185- - - - - -

3,350,580 1,995,919 816,240 1,185,412 364,614 (490,933)

13,658,578 12,612,788 11,753,065 12,359,697 10,994,960 9,457,252

5,484,806 30,545,855 37,913,911 15,604,012 27,875,060 40,684,911152,266,493 142,114,941 132,445,898 133,947,467 81,887,808 72,080,152

62,523,224 50,297,447 47,233,591 81,308,452 84,279,279 54,433,614

$ 220,274,523 $ 222,958,243 $ 217,593,400 $ 230,859,931 $ 194,042,147 $ 167,198,677


Governmental Activities Revenues & Expenses Last Ten Years

(Unaudited)

152

June 30, June 30, June 30, June 30, 2015 2014 2013 2012

ExpensesGovernmental Activities:

Instruction $ 375,521,024 $ 362,123,810 $ 353,732,386 $ 362,214,813Instructional Resources & Media Services 11,529,428 11,199,028 11,901,993 11,264,201Curriculum and Staff Development 16,663,996 16,126,028 16,249,269 15,741,780Instructional Leadership 6,736,551 6,834,558 6,699,437 6,421,877School Leadership 35,390,638 33,846,679 32,016,145 31,110,802Guidance, Counseling & Evaluation Services 20,218,076 19,573,975 18,910,505 18,826,969Social Work Services 4,017,672 3,929,030 4,005,192 3,910,851Health Services 7,782,708 7,790,141 7,562,427 7,304,746Student (Pupil) Transportation 20,486,754 20,603,626 19,450,575 19,620,934Food Services 33,228,511 33,148,289 33,459,342 31,703,494Cocurricular/Extracurricular Activities 16,990,955 15,678,891 15,278,416 15,185,517General Administration 11,028,060 10,952,520 10,113,105 10,239,863Plant Maintenance and Operations 62,443,927 58,851,185 56,631,517 55,143,500Security and Monitoring Services 4,307,086 2,912,196 4,300,053 3,697,076Data Processing Services 17,801,725 22,803,154 25,374,479 4,304,519Community Services 500,935 381,850 448,031 2,490,482Debt Service - Interest on Long Term Debt 36,878,928 57,926,047 61,189,556 59,422,600Debt Service - Bond Issurance Cost and Fees 13,850,766 7,022,989 357,915 302,919Instructional Shared Service Arrangements 406,752 623,242 554,734 395,184Juvenile Justice Alternative Ed Program 78,657 70,506 103,654 129,060Property Tax Assessment 2,335,660 2,197,327 2,129,848 1,914,188

Total Governmental Activities Expense 698,198,809 694,595,071 680,468,579 661,345,375

Program Revenues:Charges for Services - Instruction 5,094,590 5,149,976 5,194,832 5,498,633Charges for Services - Food Service 12,858,113 12,662,275 12,775,694 13,053,012Charges for Services - Cocurricular/

Extracurricular Activities 2,191,998 2,321,854 2,610,471 2,500,124Charges for Services - Community Services 1,104,186 1,181,891 1,002,316 912,809Charges for Services - Other 1,702,300 1,693,835 1,724,686 819,350Operating Grants and Contributions 79,819,596 76,009,927 74,047,791 93,390,025Total Governmnetal Activities

Program Revenue 102,770,783 99,019,758 97,355,790 116,173,953

Net Governmental ActivitiesRevenue/(Expense) $ (595,428,026) $ (595,575,313) $ (583,112,789) $ (545,171,422)

Source: The District’s Statement of Activities (Exhibit B – 1).

153

June 30, June 30, June 30, June 30, June 30, June 30, 2011 2010 2009 2008 2007 2006

$ 376,479,406 $ 371,284,490 $ 370,221,380 $ 341,350,067 $ 314,085,161 $ 284,429,69712,323,296 11,927,161 11,466,877 10,973,149 10,125,720 10,108,73217,301,176 18,148,005 17,713,747 18,451,351 15,000,932 13,293,192

7,179,781 7,334,921 7,241,548 6,577,497 6,133,233 5,813,47933,019,232 32,584,901 31,854,872 30,159,881 27,458,570 25,251,42519,843,188 20,141,865 20,339,981 18,992,370 17,972,102 16,407,171

4,300,158 4,220,795 3,851,827 3,042,676 2,682,635 2,250,8257,921,828 7,264,301 7,174,774 6,913,545 6,513,639 6,073,372

20,182,957 18,536,672 17,801,756 16,252,571 14,838,457 14,192,29830,085,326 28,443,629 26,488,152 24,213,815 22,001,433 20,209,78415,038,573 14,947,235 13,183,671 11,655,358 9,617,833 9,159,51811,020,485 11,274,090 9,864,270 12,889,275 15,525,882 10,333,01158,741,653 58,389,526 55,883,502 52,340,812 46,407,501 43,768,619

4,467,534 3,899,077 4,103,863 3,693,348 3,231,975 2,794,3586,420,067 3,992,606 4,097,008 4,593,596 3,846,239 3,583,551

575,511 575,229 1,248,806 1,102,363 1,059,993 1,473,22160,636,418 60,720,709 63,527,081 58,684,775 39,677,973 44,515,883

280,228 281,268 281,768 173,153 185,189 125,943375,125 200,986 297,842 219,709 400,000 406,000176,333 128,650 9,510 399,150 314,250 704,025

2,180,987 2,255,319 2,383,284 2,163,506 - - 688,549,262 676,551,435 669,035,519 624,841,967 557,078,717 514,894,104

4,477,860 3,916,351 5,061,744 5,069,638 4,876,008 4,617,43813,177,449 13,486,056 13,621,294 12,929,303 12,358,839 11,583,002

2,312,500 1,964,590 1,977,886 2,118,625 1,908,113 1,783,0321,168,935 1,109,892 842,699 1,222,149 703,974 601,7551,491,891 1,348,220 1,527,317 1,699,752 1,490,131 1,465,083

102,842,030 103,315,872 74,016,670 67,096,521 60,306,286 61,180,201

125,470,665 125,140,981 97,047,610 90,135,988 81,643,351 81,230,511

$ (563,078,597) $ (551,410,454) $ (571,987,909) $ (534,705,979) $ (475,435,366) $ (433,663,593)


Business – Type Activities Revenues & Expense Last Ten Years

(Unaudited)

154

June 30, June 30, June 30, June 30, 2015 2014 2013 2012

Business - Type Activities Expenses

Property Management $ 734,221 $ 798,889 $ 745,662 $ 763,699Uniform Rental 116,708 71,638 27,471 24,198Community Education 8,000,362 7,792,713 6,951,172 6,465,728Preschool Program for Children

with Disabilities 647,012 649,999 508,685 425,314 North East Aquatics and Tennis 771,497 751,048 642,481 574,334

Total Expenses 10,269,800 10,064,287 8,875,471 8,253,273

Charges for ServicesProperty Management 602,736 763,281 717,187 618,215Uniform Rental 63,227 62,341 67,241 62,982Community Education 8,684,821 7,914,137 7,647,891 7,663,258Preschool Program for Children

with Disabilities 600,610 573,617 537,720 466,302 North East Aquatics Team 805,267 816,419 737,078 697,540

Total Charges for Services 10,756,661 10,129,795 9,707,117 9,508,297

Net Business - Type ActivitiesRevenue/(Expense) $ 486,861 $ 65,508 $ 831,646 $ 1,255,024

Source: The District’s Statement of Activities – Exhibit B-1

155

June 30, June 30, June 30, June 30, June 30, June 30, 2011 2010 2009 2008 2007 2006

$ 789,220 $ 783,522 $ 699,052 $ 661,505 $ 556,402 $ 532,78341,630 84,854 21,364 12,593 22,793 19,039

6,519,604 6,223,800 5,662,888 5,190,479 4,662,315 4,000,381

308,329 295,147 287,593 97,573 140 - 654,430 583,008 514,871 433,421 364,243 275,996

8,313,213 7,970,331 7,185,768 6,395,571 5,605,893 4,828,199

962,292 1,075,466 1,015,958 969,111 839,720 910,22572,219 63,398 57,971 65,556 59,977 53,547

7,353,074 6,659,700 6,278,078 6,010,328 5,737,390 4,684,619

330,058 326,945 287,188 108,281 - - 719,099 750,587 653,108 627,525 522,455 429,411

9,436,742 8,876,096 8,292,303 7,780,801 7,159,542 6,077,802

$ 1,123,529 $ 905,765 $ 1,106,535 $ 1,385,230 $ 1,553,649 $ 1,249,603


General Revenues and Changes in Net Position Last Ten Years

(Unaudited)

156

2015 2014 2013 2012

General Revenues and Other Changes in Net AssetsGovernmental Activities:

Taxes Property Taxes, Levied for General Purposes $ 316,681,845 $ 296,557,826 $ 280,377,773 $ 280,835,492Property Taxes, Levied for Debt Service 121,999,975 114,290,273 103,892,617 98,024,700

State Aid - Unrestricted Formula Grants 159,179,444 160,877,564 154,227,030 169,075,359Grants & Contributions not Restricted 6,954,975 7,427,927 7,396,355 7,146,480Investment Earnings 1,102,680 1,541,215 739,398 3,008,213Miscellaneous Local and Intermediate Revenue 4,457,969 4,879,436 4,905,166 3,865,677Special Item - Gain on Refunding of Escrow - - - - Transfers In (Out) 1,960,594 466,693 88,691 47,652

612,337,482 586,040,934 551,627,030 562,003,573Business-Type Activities

Transfers In (Out) (1,960,594) (466,693) (88,691) (47,652)

Total Primary Government 610,376,888 585,574,241 551,538,339 561,955,921

Change in Net Assests Governmental Activities 16,909,456 (9,534,379) (31,485,759) 16,832,151Business-Type Activities (1,473,733) (401,185) 742,955 1,207,372

Total Primary Government $ 15,435,723 $ (9,935,564) $ (30,742,804) $ 18,039,523

Source: The District’s Statement of Activities – Exhibit B-1

157

2011 2010 2009 2008 2007 2006

$ 280,283,586 $ 284,667,647 $ 285,212,528 $ 259,503,032 $ 299,583,797 $ 292,206,57597,815,240 99,452,311 99,148,977 90,758,296 68,054,503 57,289,848

171,635,705 159,950,184 148,837,569 165,028,447 111,243,699 57,262,1075,308,935 1,830,445 967,287 613,143 1,322,655 4,068,2982,210,106 4,008,550 19,254,830 50,290,166 16,659,617 17,647,2944,042,857 5,960,395 4,193,648 3,945,449 3,860,916 3,928,467

- - - - - - 77,741 46,042 1,713,167 20,493 15,941 35,000

561,374,170 555,915,574 559,328,006 570,159,026 500,741,128 432,437,589

(77,741) (46,042) (1,713,167) (20,493) (15,941) (35,000)

561,296,429 555,869,532 557,614,839 570,138,533 500,725,187 432,402,589

(1,704,427) 4,505,120 (12,659,903) 35,453,047 25,305,762 (1,226,004)1,045,788 859,723 (606,632) 1,364,737 1,537,708 1,214,603

$ (658,639) $ 5,364,843 $ (13,266,535) $ 36,817,784 $ 26,843,470 $ (11,401)


Fund Balances, Governmental Funds Last Ten Years

(Unaudited)

158

June 30, June 30, June 30, June 30,2015 2014 2013 2012

General FundReserved for:

Investments in Inventory $ - $ - $ - $ - Outstanding Encumbrances - - - - Long Term Investments - - - -

Unreserved Designated for:Potential Contract Termination Fees - - - -

Unreserved and Undesignated:Reported in the General Fund - - - -

Nonspendable:Inventory 2,455,320 2,398,552 2,296,690 2,174,173

Unassigned 112,644,911 111,719,962 111,581,508 114,579,802General Fund Balance 115,100,231 114,118,514 113,878,198 116,753,975

All Other Governmental FundsReserved, Reported in:

Debt Service Fund - - - - Capital Projects Fund - - - - Special Revenue Fund - - - -

Unreserved Designated, Reported in:Special Revenue Fund - - - -

Unreserved and Undesignated:Special Revenue Fund - - - -

NonspendableSpecial Revenue Funds 51,430 965,531 915,105 959,239Permanent Fund 200,000 200,000 200,000 200,000

Restricted:Debt Service Fund 90,277,490 88,943,519 82,364,155 82,716,079Capital Projects Fund 98,294,312 246,974,168 48,920,137 43,110,047Special Revenue Fund 9,786,962 8,061,759 8,069,198 8,767,011Permanent Fund 25,248 17,726 14,594 31,827

CommittedCapital Projects Fund - - - Special Revenue Fund 3,284,254 2,946,384 2,769,871 2,680,156

Assigned:Debt Service Fund 7,004,770 5,404,278 3,764,281 2,048,563

All Other Governmental Funds Fund Balance 208,924,466 353,513,365 147,017,341 140,512,922

Total Fund Balances $ 324,024,697 $ 467,631,879 $ 260,895,539 $ 257,266,897

General FundBeginning Fund Balance $ 114,118,514 $ 113,878,198 $ 116,753,975 $ 89,680,721Net Change in Fund Balance 981,717 240,316 (2,875,777) 27,073,254Ending Fund Balance $ 115,100,231 $ 114,118,514 $ 113,878,198 $ 116,753,975

Source: The District’s Governmental Funds Balance Sheet, Exhibit C-1

159

June 30, June 30, June 30, June 30, June 30, June 30,2011 2010 2009 2008 2007 2006

$ - $ 1,754,001 $ 1,669,537 $ 1,377,357 $ 1,300,122 $ 1,256,561- 1,783,846 2,066,473 2,062,856 1,956,599 1,903,356- - - - - -

- - - - 549,888 900,888

- 68,356,422 57,266,274 67,552,798 75,132,466 61,306,585

2,039,068 - - - - - 87,641,653 - - - - - 89,680,721 71,894,269 61,002,284 70,993,011 78,939,075 65,367,390

- 76,780,278 72,622,293 54,093,988 35,901,648 34,572,263- 154,603,142 354,128,459 525,348,305 85,653,777 201,524,723- 9,097,028 7,538,512 6,920,899 7,164,355 7,002,959

- 2,185,590 2,462,222 2,201,825 2,268,522 2,003,602

- 99,999 - - - -

693,195 - - - - - - - - - - -

88,909,880 - - - - - 104,969,423 - - - - -

9,939,609 - - - - - - - - - - -

1,117,780 - - - - - 2,523,721 - - - - -

1,342,550 - - - - - 209,496,158 242,766,037 436,751,486 588,565,017 130,988,302 245,103,547

$ 299,176,879 $ 314,660,306 $ 497,753,770 $ 659,558,028 $ 209,927,377 $ 310,470,937

$ 71,894,269 $ 61,002,284 $ 70,993,011 $ 78,939,075 $ 65,367,390 $ 68,631,98217,786,452 10,891,985 (9,990,727) (7,946,064) 13,571,685 (3,264,592)

$ 89,680,721 $ 71,894,269 $ 61,002,284 $ 70,993,011 $ 78,939,075 $ 65,367,390


Governmental Fund Revenues Last Ten Years

(Unaudited)

160

2015 2014 2013 2012Local Revenues

Property Taxes $ 438,545,561 $ 411,683,914 $ 387,606,920 $ 377,955,617Penalties, Interest and Other Tax

Related Income 2,487,181 2,426,661 2,287,276 2,467,016Investment Income 1,102,680 1,508,551 726,547 2,996,407Food Sales 12,858,113 12,662,275 12,775,694 13,053,012Cocurricular Student Activities 1,477,235 246,493 2,502,287 1,816,293Other 10,462,748 11,294,441 9,199,773 9,284,872

Total Local Revenues 466,933,518 439,822,335 415,098,497 407,573,217

State RevenuesPer Capita and Foundation 159,179,444 160,877,564 19,008,010 169,075,359Other 31,120,595 26,846,772 159,443,287 35,377,612

Total State Revenues 190,300,039 187,724,336 178,451,297 204,452,971

Federal Revenues 55,653,976 56,591,082 57,214,317 64,333,954

Total Governmental Fund Revenues $ 712,887,533 $ 684,137,753 $ 650,764,111 $ 676,360,142

Source: The District’s Governmental Funds Statement of Revenues, Expenditures, and Changes

in Fund Balance and footnotes.

161

2011 2010 2009 2008 2007 2006

$ 377,944,850 $ 382,875,279 $ 384,163,874 $ 351,152,097 $ 366,036,447 $ 350,159,629

2,878,177 2,824,758 2,995,021 2,726,884 2,896,894 3,127,1962,168,184 5,850,374 18,543,846 49,508,320 15,925,682 17,260,214

13,179,571 13,486,056 13,621,294 12,940,978 12,363,007 11,588,4031,661,528 1,383,842 1,306,956 1,371,203 1,586,383 1,401,7848,956,859 8,146,656 9,584,487 9,930,520 8,446,896 7,990,232

406,789,169 414,566,965 430,215,478 427,630,002 407,255,309 391,527,458

171,630,709 158,858,985 153,419,559 171,799,950 111,243,699 57,148,24932,680,474 32,905,164 28,712,604 25,755,762 27,728,555 28,221,855

204,311,183 191,764,149 182,132,163 197,555,712 138,972,254 85,370,104

75,448,757 73,307,235 41,587,591 34,971,068 33,550,268 36,920,438

$ 686,549,109 $ 679,638,349 $ 653,935,232 $ 660,156,782 $ 579,777,831 $ 513,818,000

North East Independent School District Governmental Fund Expenditures by Function

Last Ten Years

(Unaudited)

162

2015 2014 2013 2012Instruction $ 346,902,321 $ 333,015,479 $ 323,660,059 $ 329,227,764Instructional Resources & Media Services 8,621,119 8,397,311 8,073,648 8,212,815Curriculum & Instructional Staff Development 16,902,450 16,244,544 16,300,363 15,626,408Instructional Leadership 6,890,101 6,917,750 6,745,897 6,352,202School Leadership 34,142,116 32,492,202 30,548,906 29,409,055Guidance, Counseling & Evaluation Services 20,081,912 19,284,057 18,475,639 18,332,766Social Work Services 4,100,889 3,979,758 4,001,228 3,863,889Health Services 7,583,670 7,582,017 7,271,458 6,939,591Student (Pupil) Transportation 18,022,734 18,420,988 17,181,883 17,214,233Food Services 30,972,062 30,914,756 31,236,669 29,641,367Cocurricular/Extracurricular Activities 11,003,133 9,759,835 9,484,976 9,054,132General Administration 11,431,047 11,066,171 10,042,550 10,240,180Plant Maintenance and Operations 53,096,804 52,004,431 49,359,980 50,456,180Security and Monitoring Services 4,781,741 4,539,714 4,171,329 4,139,986Data Processing Services 4,520,579 4,392,428 4,167,871 3,946,486Community Services 514,023 447,926 469,574 518,024Debt Service

Principal on Long-Term Debt 52,580,000 43,630,000 48,035,000 46,685,000 Interest on Long-Term Debt 60,576,951 63,544,462 60,957,674 60,029,974 Bond Issuance Cost and Fees 13,850,766 7,022,989 1,301,423 2,750

Capital Outlay Facilities Acquisition and Construction 151,300,370 88,606,153 109,371,010 65,145,367

Intergovernmental Instructional Shared Service Arrangements 406,752 623,242 554,734 395,184

Juvenile Justice Alternative Ed. Prg. 78,657 70,506 103,654 129,060Property Appraisal Services 2,335,660 2,197,327 2,129,848 1,914,188

Total Expenditures $ 860,695,857 $ 765,154,046 $ 763,645,373 $ 717,476,601

Debt Service as a Percentage ofNoncapital Expenditures 17.3% 19.1% 14.8% 17.6%

Capital Outlay as a Percentage of Operating Expenditures 26.0% 15.8% 20.1% 11.9%

Source: The District’s Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance. NA: Information presentation varied in previous years as detailed data was not available. Note: Operating expenditures exclude debt service and capital outlay amounts.

Noncapital expenditures exclude capital outlay amounts noted in Schedule C-4 and detailed in Footnote II B.

163

2011 2010 2009 2008 2007 2006$ 338,450,529 $ 341,012,154 $ 328,374,043 $ 315,670,149 $ 289,736,951 $ 263,305,073

9,305,163 8,838,629 8,600,928 8,147,961 7,756,138 7,404,46417,023,819 17,175,725 16,777,791 16,060,604 14,165,585 12,673,833

7,004,924 7,289,535 7,212,442 6,570,315 6,105,198 5,739,48230,842,090 31,509,738 30,818,927 29,344,553 26,503,562 24,310,44619,071,789 19,808,945 20,100,593 18,836,979 17,823,883 16,160,404

4,202,551 4,196,899 3,868,552 3,024,594 2,669,135 2,218,9417,431,752 7,037,574 6,914,922 6,848,743 6,423,803 5,928,907

17,331,546 16,582,909 15,987,718 15,273,737 15,156,699 13,924,82227,176,913 26,431,893 24,530,646 23,115,479 21,134,535 19,059,956

9,317,518 9,530,527 9,165,895 8,728,208 7,305,371 6,853,42210,672,410 11,232,452 10,738,540 10,873,973 12,873,119 11,796,84752,669,553 51,540,017 50,303,380 46,429,152 42,349,212 39,871,700

4,627,130 4,479,701 4,004,227 3,564,780 3,157,616 2,916,1855,796,778 3,709,211 3,326,788 3,346,081 2,861,104 2,626,813

552,611 576,291 1,234,332 1,083,710 1,023,623 1,442,756

27,290,000 35,330,000 20,035,000 29,120,000 27,890,000 25,865,00059,585,817 60,437,916 61,619,960 49,035,979 41,477,973 38,546,060

365,803 3,790 4,290 2,764,763 1,737,594 1,137,222

85,836,050 204,807,956 189,416,672 114,933,305 133,255,321 172,097,723

375,125 200,986 297,842 219,709 400,000 406,000176,333 128,650 9,510 399,150 314,250 704,025

2,180,987 2,255,319 2,383,284 2,163,506 NA NA

$ 737,287,191 $ 864,116,817 $ 815,726,282 $ 715,555,430 $ 682,120,672 $ 674,990,081

13.2% 14.2% 12.5% 13.0% 12.6% 12.8%

15.2% 36.3% 34.8% 22.1% 27.9% 39.4%


Governmental Fund Other Sources, Uses And Changes in Fund Balance

Last Ten Years

(Unaudited)

164

2015 2014 2013 2012Excess of Revenues over (Under) Expenditures $ (147,808,324) $ (81,016,293) $ (112,881,262) $ (41,116,459)

Other Financing Sources (Uses) Refunding Bonds Issued 533,930,000 154,950,000 79,290,000 - Capital-related Debt Issued - 278,525,000 101,320,000 Sale of Real and Personal Property 10,964 293,197 1,824 Transfers In 3,670,177 4,707,933 2,771,943 982,917 Premium or Discount on

Issuance of Bonds 60,168,687 28,438,935 26,459,156 - Prepaid Interest 1,155,787 - Other Resources - - - - Other Uses - - - - Transfers Out (Use) (3,182,583) (5,234,240) (3,427,052) (1,778,265) Payment to Bond Refunding

Escrow Agent (Use) (590,396,103) (173,928,192) (91,059,930) - Total Other Financing Sources(Uses) 4,201,142 287,752,633 116,509,904 (793,524)

Net Change in Fund Balances $ (143,607,182) $ 206,736,340 $ 3,628,642 $ (41,909,983)

Source: The District’s Governmental Funds Statement of Revenues, Expenditures, and Changes

in Fund Balances.

165

2011 2010 2009 2008 2007 2006

$ (50,738,082) $ (184,478,468) $ (161,791,050) $ (55,398,648) $ (102,342,841) $ (161,172,081)

- - - - 246,795,000 124,580,00037,545,000 - - 488,590,965 - 149,000,000

- - 2,725 20,718 - 11,4972,298,538 2,176,579 2,449,637 9,364,856 9,286,859 4,855,328

- - - 16,397,123 38,075,706 9,385,246- - - - - - - - - - - - - - - - - -

(2,563,797) (791,575) (2,465,570) (9,344,363) (9,221,829) (5,102,328)

- - - - (283,136,459) (131,772,813)37,279,741 1,385,004 (13,208) 505,029,299 1,799,277 150,956,930

$ (13,458,341) $ (183,093,464) $ (161,804,258) $ 449,630,651 $ (100,543,564) $ (10,215,151)


General Fund Revenues Per ADA

Last Ten Years

(Unaudited)

166

Local Tuition Per CapitaFiscal Maintenance From andYear Tax Patrons Other Total Foundation Other Total

2006 $ 5,289.47 $ 16.05 $ 129.88 $ 5,435.40 $ 1,024.99 $ 264.87 $ 1,289.862007 5,249.15 18.22 156.92 5,424.30 1,941.19 310.80 2,251.992008 4,508.39 15.43 160.52 4,684.35 2,831.16 361.13 3,192.302009 4,810.40 22.42 82.29 4,915.11 2,491.25 367.94 2,859.192010 4,650.48 8.69 62.05 4,721.23 2,583.91 379.82 2,963.732011 4,504.47 9.63 61.17 4,575.26 2,737.50 377.84 3,115.342012 4,432.50 10.95 62.02 4,505.47 2,642.74 346.65 2,989.392013 4,449.10 12.08 66.69 4,527.86 2,403.93 326.90 2,730.832014 4,649.83 11.70 62.95 4,724.48 2,493.67 343.71 2,837.382015 4,987.29 13.99 66.38 5,067.66 2,485.25 350.46 2,835.71

* Average Daily Attendance is the average daily attendance of eligible enrollees,District-wide, over the number of instructional days in a school year.

** Average Daily Membership is the average daily enrollment of students, District-Wide, based on the first week of October membership.

Local and Intermediate Sources State Sources

Source: General Fund revenue was obtained from the Statement of Revenues, Expenditures,

and Changes in Fund Balance for each respective year. These amounts were then divided by the ADA amounts in the respective CAFR.

167

PercentageIncrease

Ratio of of Average* ** Average Daily Daily

Vocational Total Average Average Attendance to AttendanceFederally and All Daily Daily Average Daily Over

Distributed Other Total Sources Attendance Membership Membership Prior Year

$ 11.08 $ 14.55 $ 25.63 $ 6,750.90 55,866 58,699 95.17 3.7611.61 9.58 21.19 7,697.47 57,307 60,170 95.24 2.58

5.79 13.36 19.15 7,895.79 58,290 61,041 95.49 1.7211.55 9.66 21.21 7,795.51 59,744 62,288 95.92 2.4957.31 9.10 66.41 7,751.36 61,480 64,351 95.54 2.9181.57 14.85 96.42 7,787.03 62,698 65,454 95.79 1.9887.56 12.75 100.31 7,595.18 63,642 66,198 96.14 1.51

102.22 11.09 113.31 7,372.00 63,935 66,662 95.91 0.4696.93 12.51 109.44 7,671.30 64,308 67,042 95.92 0.5897.98 12.40 110.39 8,013.76 63,848 66,758 95.64 (0.72)

Federal Sources


General Fund Expenditures Per ADA

Last Ten Years

(Unaudited)

168

Instruction and Instructional SupportAverage Instructional- and Services – Administrative

Fiscal Daily Related School Student SupportYear Attendance Services Leadership (Pupil) Services

2006 55,866 $ 4,532.64 $ 519.83 $ 749.96 $ 210.142007 57,307 4,926.97 554.84 792.07 224.482008 58,290 5,251.17 603.25 842.94 186.552009 59,744 5,289.20 619.36 865.67 179.742010 61,480 4,955.87 598.29 863.00 182.702011 62,698 4,875.05 583.90 854.29 169.732012 63,642 4,696.81 545.42 816.05 160.352013 63,935 4,915.13 565.33 825.17 155.192014 64,308 5,037.07 593.98 862.68 169.862015 63,848 5,264.31 624.50 894.53 176.70

Note: Average Daily Attendance (ADA) obtained from PEIMS reports via the Texas Education Agency website.

The Per ADA Expenditures are calculated by summing the functional categories (1X, 2X,

etc.) from the respective General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance and then dividing by the ADA.

169

Support FacilitiesAdministrative Services – Acquisition Inter-

Nonstudent Ancillary and GovernmentalBased Services Construction Charges Total

$ 752.38 $ 3.64 $ 19.43 $ 19.87 $ 6,807.89788.15 2.66 3.52 12.46 7,305.16864.97 4.13 76.61 47.73 7,877.34923.22 5.10 0.70 45.04 7,928.03946.75 4.42 - 42.05 7,593.08945.21 3.42 0.13 43.58 7,475.31891.84 3.09 0.08 38.31 7,151.96874.38 2.67 - 43.23 7,381.10914.88 2.69 - 44.53 7,625.70946.11 2.84 1.15 44.18 7,954.33

170


171

Revenue Capacity Information


Assessed and Actual Value of Taxable Property Last Ten Years

(Unaudited)

172

Fiscal Real PersonalYear Property Property Total

2006 * $ 17,394,346,513 $ 2,216,373,331 $ 19,610,719,844 8.07 %2007 ** 19,905,740,339 2,172,714,103 22,078,454,442 12.582008 ** 23,028,003,689 2,050,469,368 25,078,473,057 13.592009 ** 25,750,815,923 1,884,830,105 27,635,646,028 10.202010 ** 26,055,087,119 1,671,508,400 27,726,595,519 0.332011 ** 25,471,284,514 2,641,576,795 28,112,861,309 1.392012 ** 25,317,364,002 2,641,805,632 27,959,169,634 (0.55)2013 ** 25,442,857,080 2,616,776,085 28,059,633,165 0.362014 ** 26,671,093,661 2,758,442,672 29,429,536,333 4.882015 ** 28,705,826,164 2,843,845,035 31,549,671,199 7.20

Source: * Bexar County Tax Assessor/Collector

** NEISD Tax Consultant/Bexar County Tax Assessor/Bexar Appraisal District

Valuation

Assessed ValueChange inAssessed

Note: Texas appraises property at estimated market valuation. Therefore, the assessed

valuation is at 100% of market value for all years shown.

173

Total Gross Net Direct

Assessed Assessed Tax Value State Local Value Rate

$ 22,657,097,685 $ 2,773,097,368 $ 273,280,473 $ 19,610,719,844 1.79400025,434,877,348 3,073,314,762 283,108,144 22,078,454,442 1.66900029,204,137,043 3,833,946,848 291,717,138 25,078,473,057 1.40290031,995,175,002 4,058,899,209 300,629,765 27,635,646,028 1.40290032,129,108,292 4,099,097,576 303,415,197 27,726,595,519 1.40290031,249,082,566 2,698,993,941 437,227,316 28,112,861,309 1.40290031,179,120,474 2,770,085,256 449,865,584 27,959,169,634 1.40290031,369,578,469 2,862,464,606 447,480,698 28,059,633,165 1.42500032,730,698,142 2,657,411,858 643,749,951 29,429,536,333 1.44060034,904,502,101 2,707,438,945 647,391,957 31,549,671,199 1.440600

Property Tax Exemptions


Direct and Overlapping Property Tax Rates Last Ten Years

(Unaudited)

174

2015 2014 2013 2012Direct Tax Rate Maintenance and Operations $ 1.040000 $ 1.040000 $ 1.040000 $ 1.040000

Interest and Sinking 0.400600 0.400600 0.385000 0.362900Total Direct Tax Rate $ 1.440600 $ 1.440600 $ 1.425000 $ 1.402900

Overlapping Tax RatesAlamo Community College District $ 0.149150 $ 0.149150 $ 0.149150 $ 0.141623Bexar County 0.283821 0.296187 0.296187 0.296187Bexar County Road & Flood 0.030679 0.030679 0.030679 0.030679San Antonio River Authority 0.017500 0.017798 0.017370 0.017370University Health System 0.276235 0.276235 0.276235 0.276235Balcones Heights, City of 0.572199 0.572199 0.572199 0.572199Bexar County Emergency District # 1 0.100000 0.100000 0.100000 0.100000Bexar County Emergency District # 3 0.051408 0.050877 0.038628 0.034532Castle Hills, City of 0.501345 0.501345 0.501345 0.501345Cibolo Canyons Special

Improvement District 0.565690 0.565690 0.565690 0.565690Hill Country Village 0.095000 0.095000 0.095000 0.095000Hollywood Park 0.511000 0.511000 0.536710 0.536710Live Oak, City of 0.510000 0.445401 0.463155 0.477291San Antonio, City of 0.565690 0.565690 0.565690 0.565690Terrell Hills, City of 0.370525 0.371729 0.385068 0.385068Windcrest, City of 0.340900 0.415231 0.432970 0.436495

Total Overlapping Tax Rates 4.941142 4.964211 5.026076 5.032114

Total Direct andOverlapping Tax Rate $ 6.381742 $ 6.404811 $ 6.451076 $ 6.435014

Note: The District was subject to a maximum Maintenance & Operations Tax Rate of $1.50 per

hundred dollars of assessed valuation for all years prior to fiscal 2007. For fiscal 2007, the District had a maximum of $1.37 per hundred dollars of valuation. For fiscal 2008 and beyond, the District’s tax rate had a maximum of $1.04 without voter approval.

175

2011 2010 2009 2008 2007 2006

$ 1.040000 $ 1.040000 $ 1.040000 $ 1.040000 $ 1.360000 $ 1.5000000.362900 0.362900 0.362900 0.362900 0.309000 0.294000

$ 1.402900 $ 1.402900 $ 1.402900 $ 1.402900 $ 1.669000 $ 1.794000

$ 0.141623 $ 0.135855 $ 0.135855 $ 0.134550 $ 0.137500 $ 0.1070500.296187 0.296187 0.289399 0.295104 0.314147 0.3184710.030679 0.030679 0.037467 0.031762 0.012719 0.0127190.016652 0.015951 0.015951 0.015951 0.015951 0.0164500.276235 0.266235 0.261022 0.237408 0.243869 0.2438690.558843 0.510481 0.490729 0.498356 0.532404 0.5585000.100000 0.100000 0.100000 0.097848 0.100000 0.1000000.034300 0.030772 0.030000 0.031222 0.035200 0.0510000.501345 0.458668 0.425801 0.425801 0.458908 0.479634

0.565690 0.565690 0.567140 0.057230 0.000000 0.0000000.095000 0.095000 0.090500 0.905000 0.090500 0.0950000.490000 0.490000 0.382261 0.381464 0.395908 0.4179260.476783 0.449369 0.405131 0.364400 0.385000 0.4100000.565690 0.565690 0.567140 0.572300 0.578450 0.5785400.385068 0.391301 0.399293 0.430422 0.465853 0.5168640.436495 0.436495 0.436227 0.407239 0.412454 0.4126224.970590 4.838373 4.633916 4.886057 4.178863 4.318645

$ 6.373490 $ 6.241273 $ 6.036816 $ 6.288957 $ 5.847863 $ 6.112645


Property Tax Levies and Collections Last Ten Years

(Unaudited)

176

Adjusted Tax Collections Total Collections to DateFiscal Levy for the Current in Subsequent Year Fiscal Year Collections Years Amount

2006 $ 349,440,228 $ 336,761,086 96.37 % $ 12,258,219 $ 349,019,305 99.88 %2007 366,577,736 353,471,532 96.42 12,708,027 366,179,559 99.892008 350,420,447 335,619,453 95.78 14,295,195 349,914,648 99.862009 383,486,467 368,364,241 96.06 14,866,981 383,231,222 99.932010 383,509,163 369,026,838 96.22 14,230,479 383,257,317 99.932011 378,870,806 365,484,001 96.47 12,832,404 378,316,405 99.852012 379,129,486 362,853,349 95.71 15,352,008 378,205,357 99.762013 388,505,226 373,244,230 96.07 12,996,985 386,241,215 99.422014 411,976,768 397,836,294 96.57 11,353,668 409,189,962 99.322015 439,926,797 427,386,125 97.15 - 427,386,125 97.15

of Levy of LevyPercentagePercentage


Principal Property Taxpayers Current Year and Nine Years Prior

(Unaudited)

177

Percentage Percentage2015 of Total 2006 of Total

Assessed Assessed Assessed Assessed 2006Name Valuation Valuation Valuation Valuation Rank

VHS San Antonio PRTNR $ 255,791,862 0.87% $ 143,263,930 0.73% 2Methodist Healthcare Systems SA 252,526,888 0.86% - HEB Grocery 197,018,733 0.67% 87,577,343 0.45% 4North Star Mall, Inc. 178,503,926 0.61% 120,465,677 0.61% 3Wal-Mart 137,016,910 0.47% 72,805,848.0 0.37% 7Cole OFC San Antonio (Ridgewood Parkway)126,000,000 0.43% - DDR DB SA Ventures, LP 100,075,760 0.34% - Frankel Family Trust 89,750,000 0.30% 78,523,202.0 0.40% 6PN Investment Plaza LP 89,158,850 0.30% - Santikos Legacy LTD 70,465,570 0.24% - Southwestern Bell - - 149,009,970 0.76% 1MBS-Colonnade LTD - - 82,092,240 0.42% 5Inland West San Antonio LP - - 68,026,879.0 0.35% 8CWS Q-Daly LP - - 64,279,594 0.33% 9Texas Machining Enterprises - - 62,987,320.0 0.32% 10

$ 1,496,308,499 5.08% $ 929,032,003 4.74%

Source: Information for current year Principal Taxpayers was provided by the Bexar Appraisal

District. The information for 2006 was obtained from the CAFR for fiscal 2005-2006. Note: No information is presented in either year if the taxpayer was not in the top ten principal

taxpayers for that year.


Allocation of Tax Rates and Levies Last Ten Years

(Unaudited)

178

Debt DebtFiscal General Service General ServiceYear Fund Fund Total Fund Fund Total

2006 $ 1.500000 $ 0.294000 $ 1.794000 $ 293,010,722 $ 57,430,101 $ 350,440,8232007 1.360000 0.309000 1.669000 299,393,866 68,024,047 367,417,9132008 1.040000 0.362900 1.402900 260,696,401 90,968,004 351,664,4052009 1.040000 0.362900 1.402900 285,951,059 99,780,422 385,731,4812010 1.040000 0.362900 1.402900 287,397,759 100,285,237 387,682,9962011 1.040000 0.362900 1.402900 282,631,641 98,622,137 381,253,7782012 1.040000 0.362900 1.402900 282,431,587 98,552,330 380,983,9172013 1.040000 0.385000 1.425000 283,540,656 104,964,570 388,505,2262014 1.040000 0.400600 1.440600 297,414,854 114,561,914 411,976,7682015 1.040000 0.400600 1.440600 317,592,579 122,334,218 439,926,797

Source: Bexar County Tax Assessor/Collector October 1 Tax RollThe basis for the property tax rate is $100 assessed valuation.

Tax Rates Tax Levies

179

Debt Capacity Information


Outstanding Debt by Type Last Ten Years

(Unaudited)

180

General DebtFiscal Obligation PerYear Bonds Capita

2006 $ 921,510,683 8.6 $ 2,5182007 895,251,016 7.8 2,4352008 1,372,008,129 11.1 3,6532009 1,352,934,732 10.1 3,5222010 1,318,413,010 9.2 3,3572011 1,329,249,909 9.2 3,3522012 1,282,544,364 8.6 3,1222013 1,377,048,858 8.5 3,3102014 1,616,319,231 9.4 3,7382015 1,588,110,484 NA 3,715

Percentage of Personal

Income

Note:

General Obligation bonds are those backed by the full credit of the District and that do not have any revenue streams dedicated to their repayment. Currently, all outstanding bonds are considered to be general obligation bonds of the District.

Source:

Debt information was obtained from the District’s CAFR in the corresponding year. The per capita and personal income information was obtained for San Antonio Metropolitan area from the Texas Workforce Commission’s Web site. NA – Not Available


Direct and Overlapping Debt As of June 30, 2014

(Unaudited)

181

Estimated Shareof Direct and

Debt OverlappingGovernmental Unit Outstanding As of Debt

City of San Antonio $ 1,412,470,000 6/30/2015 32.01 % $ 452,131,647Bexar County 1,532,245,000 6/30/2015 31.06 475,915,297University Health System 695,560,000 6/30/2015 26.44 183,906,064Alamo Community College District 472,660,000 6/30/2015 27.63 130,595,958Cibolo Canyons Special ID 28,835,000 6/30/2015 43.23 12,465,371 City of Live Oak 23,440,000 6/30/2015 33.76 7,913,344City of Terrell Hills 9,355,000 6/30/2015 10.53 985,082Hill Country Village 712,000 6/30/2015 100.00 712,000City of Balcones Heights 374,000 6/30/2015 56.50 211,310

Subtotal, Overlapping Debt 1,264,836,072 District Direct Debt 1,588,110,484

Total Direct and Overlapping Debt $ 2,852,946,556

PercentageApplicable

Estimated

Source:

The Municipal Advisory Council of Texas.

NOTE: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the District. The overlapping percentage represents an estimate of the overlapping geographic area between the District and the respective governments listed above. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses within the boundaries of the District. This process recognizes that, when considering the District's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government.


Debt Margin Information Last Ten Years

(Unaudited)

182

2015 2014 2013 2012

Debt Limit – 10% of Assessed Valuation $ 3,154,967,120 $ 2,942,953,633 $ 2,805,963,317 $ 2,795,916,963

Outstanding Bonds 1,588,110,484 1,616,319,231 1,377,048,858 1,282,544,364Less: Amounts Set Restricted to Repay

Debt on Statement of Net Position 92,720,939 91,274,335 84,790,028 81,529,099

Applicable Debt 1,495,389,545 1,525,044,896 1,292,258,830 1,201,015,265

Debt Margin $ 1,659,577,575 $ 1,417,908,737 $ 1,513,704,487 $ 1,594,901,698

Debt Margin as a Percentage of the Debt Limit 52.60% 48.18% 53.95% 57.04%(Debt Margin Divided by Debt Limit)

Total Assets per Statement of Net Position $ 1,826,631,483 $ 1,888,235,241 $ 1,668,031,776 $ 1,621,128,810

Debt as a Percentage of Assets per Statement of Net Position 86.94% 85.60% 82.56% 79.11% Note: Texas Statutes do not prescribe a legal debt limit. For comparison purposes, a 10% debt limit

has been used in this schedule.

183

2011 2010 2009 2008 2007 2006

$ 2,811,286,131 $ 2,772,659,552 $ 2,763,564,603 $ 2,507,847,306 $ 2,207,845,444 $ 1,961,071,984

1,329,249,909 1,318,413,010 1,352,934,732 1,372,008,129 895,251,016 921,510,683

67,908,016 54,737,957 49,709,492 56,109,149 37,723,602 36,025,714

1,261,341,893 1,263,675,053 1,303,225,240 1,315,898,980 857,527,414 885,484,969

$ 1,549,944,238 $ 1,508,984,499 $ 1,460,339,363 $ 1,191,948,326 $ 1,350,318,030 $ 1,075,587,015

55.13% 54.42% 52.84% 47.53% 61.16% 54.85%

$ 1,652,913,233 $ 1,649,593,434 $ 1,701,369,551 $ 1,713,754,465 $ 1,187,995,548 $ 1,202,398,088

80.42% 79.92% 79.52% 80.06% 75.36% 76.64%


Debt to Net Assessed Valuation Last Ten Years

(Unaudited)

184

*Average ** Net Total

Fiscal Daily Estimated Assessed BondedYear Membership Population Value Debt

2006 58,699 366,038 $ 19,610,719,844 $ 921,510,6832007 60,170 367,684 22,078,454,442 895,251,0162008 61,041 375,592 25,078,473,057 1,372,008,1292009 62,288 384,156 27,635,646,028 1,352,934,7322010 64,351 392,720 27,726,595,519 1,318,413,0102011 65,454 396,578 28,112,861,309 1,329,249,9092012 66,198 410,746 27,959,169,634 1,282,544,3642013 66,662 415,965 28,059,633,165 1,377,048,8582014 67,042 432,384 29,429,536,333 1,616,319,2312015 66,758 427,521 31,549,671,199 1,588,110,484

* Average Daily Membership is the District-wide average daily enrollment of students basedon the first week of October membership. Prior years' ADM reflects the average for theentire school year based on final report of ADA and ADM.

** Source: See the Demographic and Economic schedule in the following section.

*** Amount includes accreted portion of capital appreciation bonds

185

Restricted Per Net Debt For Net Average Ratio to Ratio ToDebt Bonded Daily Assessed Per Assessed

Service Debt Membership Valuation Capita Valuation

$ 36,025,714 $ 885,484,969 $ 15,085 4.52 $ 2,419 4.7037,723,602 857,527,414 14,252 3.88 2,332 4.0556,109,149 1,315,898,980 21,558 5.25 3,504 5.4749,709,492 1,303,225,240 20,923 4.72 3,392 4.9054,737,957 1,263,675,053 19,637 4.56 3,218 4.7667,908,016 1,261,341,893 19,271 4.49 3,181 4.7381,529,099 1,201,015,265 18,143 4.30 2,924 4.5984,790,028 1,292,258,830 19,385 4.61 3,107 4.9188,943,519 1,527,375,712 22,782 5.19 3,532 5.4990,277,490 1,497,832,994 22,437 4.75 3,504 5.03

Net Debt


Bonded Debt to Operating Expenditures Last Ten Years

(Unaudited)

186

Ratio ofInterest Total Total Debt Service

Fiscal and Debt General to GeneralYear Principal Fees Service Expenditures Expenditures

2006 $ 25,865,000 $ 39,683,282 $ 65,548,282 $ 380,329,322 17.2 %2007 27,890,000 43,215,567 71,105,567 418,636,700 17.02008 29,120,000 51,800,742 80,920,742 459,170,221 17.62009 20,035,000 61,624,250 81,659,250 473,652,066 17.22010 35,330,000 60,437,916 95,767,916 466,822,696 20.52011 27,290,000 59,585,818 86,875,818 468,687,096 18.52012 46,685,000 60,029,974 106,714,974 455,164,878 23.42013 48,035,000 60,957,674 108,992,674 471,910,625 23.12014 43,630,000 67,261,051 110,891,051 490,393,260 22.62015 52,580,000 60,576,951 113,156,951 507,868,164 22.3

* Accreted portion of bonds included in principal rather than interest amount forcapital appreciation bonds.

Source: The District’s CAFR.

187

Demographic and Economic Information


Demographic and Economic Information Last Ten Years

(Unaudited)

188

Per Assessed Capita Valuation

Fiscal Personal Personal of Taxable WealthYear Population Income Income Property Per ADA

2006 366,038 $ 10,727,841,704 $ 29,308 5.3 % $ 19,610,719,844 $ 351,0312007 367,684 11,486,080,476 31,239 4.5 22,078,454,442 385,2662008 375,592 12,376,507,584 32,952 4.9 25,078,473,057 430,2362009 384,156 13,337,128,008 34,718 7.2 27,635,646,028 462,5682010 392,720 14,353,130,560 36,548 7.6 27,726,595,519 450,9862011 396,578 14,389,832,730 36,285 8.1 28,112,861,309 448,3852012 410,746 14,933,492,322 36,357 7.1 27,959,169,634 439,3192013 415,965 16,230,538,335 39,019 6.7 28,059,633,165 438,8782014 432,384 17,274,173,184 39,951 5.1 29,429,536,333 457,6342015 427,521 NA NA 3.8 31,549,671,199 494,137

RateUnemployment

Note: ADA information is available on the following page.

Source: Population estimates are provided as follows:

U.S. Census Bureau’s American Community Survey for 2006-2015.

Per capita income information was obtained from the U.S. Department of Commerce Bureau of Economic Analysis. San Antonio metropolitan area information was used to provide consistent historical information in this schedule. The personal income total equals the District’s population estimate multiplied by San Antonio metropolitan area per capita income. Unemployment rate information was obtained from the U.S. Department of Labor Bureau of Labor Statistics website for the San Antonio Metropolitan area. It is an average for the fiscal year.


Student Demographic Information Last Ten Years

(Unaudited)

189

Average Average Fiscal Daily Daily Increase/Year Attendance Membership (Decrease)

2006 55,866 3.76 % 58,699 3.65 % 38.2 % 1.002007 57,307 2.58 60,170 2.51 36.5 (1.70)2008 58,290 1.72 61,041 1.45 39.1 2.602009 59,744 2.49 62,288 2.04 39.8 0.702010 61,480 2.91 64,351 3.31 42.7 2.902011 62,698 1.98 65,454 1.71 43.3 0.602012 63,642 1.51 66,198 1.14 45.1 1.832013 63,935 0.46 66,662 0.70 47.3 2.172014 64,308 0.58 67,042 0.57 47.8 0.502015 63,848 -0.72 66,758 -0.42 46.7 (1.10)

PercentageEconomically

DisadvantagedStudents

Percentage Change

Percentage Change

Source: ADA, ADM, and the percentage of Economically Disadvantaged Students were obtained

from Academic Excellence Indicator System and Public Education Management Information System reports from TEA.

Note: The economically disadvantaged students equal the percentage of students who were

eligible for free and reduced meals at District facilities.


Principal Employers Current Year

(Unaudited)

190

2015

Percentage Percentage of Total of Total

Employer Employees Employment Employees Rank Employment

Joint Base San Antonio 80,165 8.86% NA NA(Lackland AFB, Fort Sam Houston

Randolph AFB)H.E.B. Food Stores 20,000 2.21% NA NAUSAA 16,000 1.77% 13,965 1 1.85%Northside ISD 13,000 1.44% 10,320 2 1.36%City of San Antonio 11,326 1.25% 9,601 3 1.27%North East ISD 9,141 1.01% 7,574 6 1.00%Methodist Healthcare System 8,118 0.90% 7,027 8 0.93%San Antonio ISD 7,425 0.82% 7,685 5 1.02%Baptist Healthcare System 7,205 0.80% NA NAWells Fargo 6,500 0.72% NA NASBC Communications (AT&T) NA NA 5,941 9 0.79%Fort Sam Houston NA NA 8,160 4 1.08%Alamo Community College District NA NA 7,200 7 0.95%University of Texas Health Science NA NA 5,000 10 0.66%

178,880 19.76% 82,473 10.90%

Total Employment 905,100 756,700

2006

Source: City of San Antonio Comprehensive Annual Financial Report for the Year Ended September 30, 2014. The current year information was not available.


Commercial and Residential Construction Last Ten Years

($000s)

(Unaudited)

191

Year Permits Value Permits Value

2005/2006 4,047 $ 1,840,573 15,349 $ 1,082,7392006/2007 4,351 1,919,058 13,215 746,0112007/2008 4,461 2,486,582 4,020 429,5082008/2009 5,230 1,762,510 3,781 333,1442009/2010 6,238 1,309,314 4,753 358,4012010/2011 6,545 1,218,426 4,325 292,0672011/2012 7,468 1,888,065 4,573 319,1302012/2013 6,662 2,065,217 5,286 373,4002013/2014 6,906 2,697,057 5,057 400,7462014/2015 7,475 2,087,275 5,817 436,781

Source: City of San Antonio Development Services Department

Commercial Construction Residential Construction

192


193

Operating Information


Employees by Full Time Equivalent by Job Function Last Ten Years

(Unaudited)

194

2015 2014 2013 2012Professional Staff

Teachers 4,314.8 4,258.8 4,286.4 4,299.0Professional Support 942.7 905.8 859.9 869.8Campus Administration 207.5 206.0 196.5 191.5Central Administration 25.0 8.0 8.0 7.0Total Professional Staff 5,490.0 5,378.6 5,350.8 5,367.3

Educational Aides 679.1 684.8 668.5 683.3

Auxiliary Staff 2,354.2 2,386.5 2,371.2 2,366.6

Total Staff 8,523.3 8,449.9 8,390.5 8,417.2

Pupil to Teacher Ratio 15.8 16.0 15.8 15.7

Teachers by Population ServedRegular Education 3,111.1 3,099.6 3,170.0 3,052.8 Career and Technology 117.9 114.9 107.3 112.8 Bilingual/ESL 101.5 99.5 89.2 187.6 Compensatory Education 142.6 108.2 99.2 97.0 Gifted and Talented 64.6 66.5 67.8 68.1 Special Education 439.0 432.8 422.4 452.0 Other 336.9 337.3 330.4 328.7

Total 4,313.6 4,258.8 4,286.3 4,299.0

Source: Current year information is from Public Education Information Management System (PEIMS) Reports submitted to TEA. All other data obtained via Academic Excellence Indicator System (AEIS) Reports obtained from TEA’s Web site. Minor differences between this schedule and those on the internet are due to rounding.

Note: Professional Support includes librarians, counselors, school nurses, etc.

195

2011 2010 2009 2008 2007 2006

4,376.7 4,373.9 4,310.8 4,232.8 4,080.3 3,937.2885.9 904.5 908.0 900.6 860.4 822.2193.9 194.1 189.0 183.7 175.1 167.0

8.0 10.0 10.0 12.0 10.0 12.05,464.5 5,482.5 5,417.8 5,329.1 5,125.8 4,938.4

698.5 715.3 742.5 735.4 696.5 680.3

2,394.6 2,355.5 2,346.9 2,152.2 2,025.7 1,999.8

8,557.6 8,553.3 8,507.2 8,216.7 7,848.0 7,618.5

15.2 14.9 14.7 14.6 15.0 15.2

3,099.0 3,002.0 2,753.4 2,777.0 2,846.0 2,667.9 118.1 139.0 150.1 160.6 158.3 159.2 197.8 156.5 356.7 253.8 120.5 178.6 106.0 98.1 82.6 87.6 93.8 88.4

72.7 67.8 72.6 65.8 62.7 63.2 443.6 581.6 585.3 593.0 568.7 578.8 339.6 328.8 310.2 295.0 230.3 201.1

4,376.8 4,373.8 4,310.9 4,232.8 4,080.3 3,937.2


Teacher Salary Comparison Last Ten Years

(Unaudited)

196

State StateFiscal Minimum Maximum Minimum MaximumYear Salary Salary Salary Salary

2006 $ 38,653 $ 57,619 $ 24,820 $ 41,7702007 42,153 60,803 27,320 44,2702008 44,000 62,103 27,320 44,2702009 45,500 63,503 27,320 44,2702010 46,440 57,990 27,320 44,2702011 46,440 57,990 27,320 44,2702012 46,000 57,990 27,320 44,2702013 46,634 58,474 27,320 44,2702014 47,284 58,974 27,320 44,2702015 49,288 60,078 27,540 44,620

Source: State Minimum Salary information obtained from TEA Web site. The District’s

salary information obtained from the District’s Department of Human Resources. Note: Salary information shown above is for teachers with a Bachelor’s degree. Teachers

with a Master’s degree earn an additional $1,800. Teachers with a doctorate earn $1,500 above the master’s degree stipend.

The District’s maximum salary represents the maximum amount paid to teachers with

25 or more years of experience who begin employment with the District. Teachers who were employed with the District earning more than $57,990 annually as of 2009 were grandfathered at their existing rate of pay.


Operating Statistics Last Ten Years

(Unaudited)

197

GovernmentAverage Governmental Cost Wide Cost

Fiscal Daily Operating Per Operating PerYear Attendance Expenditures Pupil Expenses Pupil

2006 55,866 $ 437,344,076 $ 7,828 11.71 % $ 470,252,278 $ 8,418 12.72 %2007 57,307 477,759,784 8,337 6.49 517,215,555 9,025 7.222008 58,290 519,701,383 8,916 6.94 565,984,039 9,710 7.582009 59,744 544,650,360 9,116 2.25 605,226,670 10,130 4.332010 61,480 563,537,155 9,166 0.55 615,549,458 10,012 (1.17)2011 62,698 564,209,521 8,999 (1.83) 627,632,616 10,010 (0.02)2012 63,642 545,613,510 8,573 (4.73) 601,619,856 9,453 (5.57)2013 63,935 545,613,510 8,534 (0.46) 618,921,108 9,680 2.402014 64,308 562,350,442 8,745 2.47 629,646,035 9,791 1.142015 63,848 582,387,770 9,121 4.31 647,469,116 10,141 3.57

ChangePercentPercent

Change

Source: CAFR Note: Operating expenditures and expenses exclude any debt service or capital transactions

as reflected in functions 71 through 81.


Fidelity Bonds Current Year

(Unaudited)

198

Amountof

Positions Covered Bond

Superintendent $ 1,000,000Associate Superintendents 1,000,000Executive Director of Management Information Services 1,000,000Senior Director of Accounting and Payroll Services 1,000,000Senior Director of Budgets and Financial Analysis 1,000,000Executive Director of Procurement and eCommerce 1,000,000Senior Director of Risk Management 1,000,000Staff Accountants 1,000,000Applications Team Leader – Finance 1,000,000Investment Officer 1,000,000Applications Team Leader – Students 1,000,000Systems Analysts 1,000,000Computer Programmers 1,000,000Workers’ Compensation Claims Manager 1,000,000Payroll Manager 1,000,000Bookkeepers – Secondary Schools 1,000,000Bookkeepers – Elementary Schools 1,000,000Other Employees 1,000,000

The District purchases blanket crime coverage that covers all employees. The $1,000,000 limit is in the aggregate for all covered positions within the coverage period. Each occurrence has a $10,000 deductible.

199



School Building Information Last Nine Years

(Unaudited)

200

2015 2014 2013Elementary SchoolsNumber of Locations 46 46 46Square Footage 4,294,855 4,294,855 4,299,003Enrollment 31,493 31,798 31,786

Middle SchoolsNumber of Locations 14 13 13Square Footage 2,403,490 2,188,779 2,159,822Enrollment 15,337 15,544 15,516

High SchoolsNumber of Locations 8 8 8Square Footage 3,251,900 3,251,900 3,267,633Enrollment 21,141 20,863 20,599

Alternative SchoolsNumber of Locations 1 1 1Square Footage 187,926 187,926 167,546

Athletic FacilitiesSquare Footage 183,732 183,732 183,732

AdministrationSquare Footage 147,456 147,456 147,456

Support FacilitiesSquare Footage 350,323 354,046 354,046

District TotalsNumber of Locations 69 68 68School Square Footage 10,138,171 9,923,460 9,894,004Total Square Footage 10,819,682 10,608,694 10,579,238Enrollment 67,971 68,205 67,901

Source: The District’s Department of Budgets and Financial Analysis and AEIS Reports.

201

2012 2011 2010 2009 2008 2007 2006

44 44 42 42 42 42 424,045,758 4,045,758 3,587,513 3,587,513 3,609,661 3,609,661 3,443,769

31,734 31,647 31,357 30,496 30,082 29,810 29,073

13 13 13 13 13 12 112,159,822 2,159,822 2,128,016 2,128,016 2,019,255 1,820,893 1,544,177

15,377 15,050 14,837 14,475 14,063 13,745 13,259

8 8 8 8 7 7 73,267,633 3,267,633 2,997,475 2,997,475 2,153,835 2,153,835 2,146,667

20,328 19,907 19,304 18,481 18,036 17,700 17,492

1 1 1 1 1 1 1167,546 167,546 168,696 168,696 166,426 166,426 134,079

183,732 183,732 183,732 147,213 134,725 134,725 129,549

147,456 147,456 147,456 147,456 147,456 147,456 147,456

354,046 354,046 354,046 320,014 308,263 308,263 349,791

66 66 64 64 63 62 619,640,759 9,640,759 8,881,700 8,881,700 7,949,177 7,750,815 7,268,692

10,325,993 10,325,993 9,566,934 9,496,383 8,539,621 8,341,259 7,895,48867,439 66,604 65,498 63,452 62,181 61,255 59,824

202

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INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED

IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Board of Trustees North East Independent School District San Antonio, Texas We have audited, 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 financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of North East Independent School District (the District) as of and for the year ended June 30, 2015, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements, and have issued our report thereon dated November 9, 2015. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the District’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters

As part of obtaining reasonable assurance about whether the District’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Certified Public Accountants

San Antonio, Texas November 9, 2015

204


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INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY OMB CIRCULAR A-133

Board of Trustees North East Independent School District San Antonio, Texas

Report on Compliance for Each Major Federal Program

We have audited North East Independent School District’s (the District) compliance with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement that could have a direct and material effect on each of the District’s major federal programs for the year ended June 30, 2015. The District’s major federal programs are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs.

Management’s Responsibility

Management is responsible for compliance with the requirements of laws, regulations, contracts, and grants applicable to its federal programs.

Auditor’s Responsibility

Our responsibility is to express an opinion on compliance for each of the District’s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Nonprofit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the District’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the District’s compliance.

Opinion on Each Major Federal Program

In our opinion, the District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2015.

Report on Internal Control Over Compliance

Management of the District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the District’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with OMB Circular A-133, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control over compliance.

A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.

Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of OMB Circular A-133. Accordingly, this report is not suitable for any other purpose.

Certified Public Accountants

San Antonio, Texas November 9, 2015

206

NORTH EAST INDEPENDENT SCHOOL DISTRICT San Antonio, Texas

Schedule of Findings and Questioned Costs

For The Year Ended June 30, 2015

207

SECTION I --- SUMMARY OF AUDITORS’ RESULTS

Financial Statements

Type of auditor’s report issued:

Unmodified

Internal control over financial reporting: • Material weakness(es) identified?

Yes

X No

• Significant deficiency(ies) identified not considered

to be material weaknesses?

Yes

X None Reported

Noncompliance material to financial statements noted?

Yes

X No

Federal Awards

Internal control over major programs: • Material weakness(es) identified?

Yes

X No

• Significant deficiency(ies) identified not considered

to be material weaknesses?

Yes

X None Reported

Type of auditor’s report issued on compliance for

major programs

Unmodified

Any audit findings disclosed that are required to be

reported in accordance with Circular A-133, Section. 510(a)?

Yes

X No

Identification of Major Programs

CFDA Numbers(s)

Name of Federal Program or Cluster

84.027 84.173

IDEA – Part B, Formula IDEA – Part B, Preschool

10.553

10.555 National School Breakfast Program National School Lunch Program

Dollar threshold used to distinguish between Type A and Type B programs:

$1,437,984

Auditee qualified as low-risk auditee? X Yes No


Schedule of Findings and Questioned Costs


208

SECTION II --- FINANCIAL STATEMENT FINDINGS There were no financial statement findings required to be reported in accordance with Government Auditing Standards. SECTION III --- FEDERAL AWARD FINDINGS AND QUESTIONED COSTS None.


Summary Schedule of Prior Audit Findings


209

There were no prior audit findings reported.

EXHIBIT K-1 (Cont'd)NORTH EAST INDEPENDENT SCHOOL DISTRICT

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS


(1)

Federal

Entity Identifying

(4)

NumberCFDA

ExpendituresFederal

Number

(3)(2)

FEDERAL GRANTOR/

PASS-THROUGH GRANTOR/PROGRAM or CLUSTER TITLE

Pass-Through

U.S. DEPARTMENT OF DEFENSE

Direct Programs

581,502ROTC 12.000 $

Total Direct Programs 581,502$

TOTAL U.S. DEPARTMENT OF DEFENSE 581,502$

U.S. DEPARTMENT OF EDUCATIONDirect Programs

186,626Impact Aid - P.L. 81.874 (Note A) 84.041 $

Total Direct Programs 186,626$

Passed Through Education Service Center Region 10

17,446McKinney-Vento Homeless Education 84.196A $14-00593,990McKinney-Vento Homeless Education 84.196A 15-062

Total CFDA Number 84.196A 111,436

Total Passed Through Education Service Center Region 10 111,436$

Passed Through Texas Workforce Commission

43,701Adult Education & Family Literacy Act 84.002A $2014ABE004

Total Passed Through Texas Workforce Commission 43,701$

Passed Through Education Service Center Region 20

229,044Adult Education & Family Literacy Continuation 84.002A $2240472502

Total Passed Through Education Service Center Region 20 229,044$

Passed Through State Department of Education

809,912ESEA, Title I, Part A - Improving Basic Programs 84.010A $1461010101591011,171,829ESEA, Title I, Part A - Improving Basic Programs 84.010A 15610101015910

221ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 1461011201591004433,050ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 146101120159101115,142ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 146101120159101208,564ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 14610112015910046

18,830ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 1461011201591011519,339ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 1461011201591012219,904ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 1561011201591004419,131ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 15610112015910046

159,599ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 1561011201591011118,169ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 156101120159101156,086ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 15610112015910120

15,657ESEA, Title I, PartA - Priority & Focus School Gra 84.010A 15610112015910122

Total CFDA Number 84.010A 12,305,433

170,479*IDEA-Part B, Formula 84.027A 1466001015910660010,475,946*IDEA-Part B, Formula 84.027A 156600010159106600

46,081*SSA - IDEA-Part B, Discr Deaf 84.027A 1566001101591066731,873*IDEA-Part B, Formula Deaf 84.027A 146600010159106601

57,839*IDEA-Part B, Formula Deaf 84.027A 156600010159106601


619*IDEA-Part B, Preschool 84.173A 146610010159106610209,873*IDEA-Part B, Preschool 84.173A 156610010159106610

1,482*SSA - IDEA-Part B, Preschool Deaf 84.173A 1466100101591066115,027*SSA - IDEA-Part B, Preschool Deaf 84.173A 156610010159106611


210

EXHIBIT K-1 (Cont'd)NORTH EAST INDEPENDENT SCHOOL DISTRICT



(1)

Federal

Entity Identifying

(4)

NumberCFDA

ExpendituresFederal

Number

(3)(2)

FEDERAL GRANTOR/


Pass-Through

10,969,219Total Special Education Cluster (IDEA)

(6)Carl D. Perkins Basic Formula Grant 84.048A 14420006015910722,436Carl D. Perkins Basic Formula Grant 84.048A 15420006015910


364IDEA-Part C Early Intervention Deaf 84.181A 153911010159103911

81,678Title III, Part A Immigrant 84.365A 14671003015910138,111Title III, Part A Immigrant 84.365A 1567100301591069,723Title III, Part A LEP 84.365A 14671001015910

638,076Title III, Part A LEP 84.365A 15671001015910


(6,286)Title II, Part A - Teacher & Principal Training & 84.367A 146945010159101,268,189Title II, Part A - Teacher & Principal Training & 84.367A 15694501015910


14,313Summer School LEP 84.369A 69551402

Total Passed Through State Department of Education 26,201,250$

TOTAL U.S. DEPARTMENT OF EDUCATION 26,772,057$

U.S. DEPARTMENT OF LABOR


1,724Workforce Investment Act-Dislocated Worker Formula 17.278 $2014ATP00136,384Workforce Investment Act-Dislocated Worker Formula 17.278 2015ATP001

Total CFDA Number 17.278 38,108


TOTAL U.S. DEPARTMENT OF LABOR 38,108$

U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES


12,945Temporary Assistance for Needy Families 93.558 $2014ABE0047,803Temporary Assistance for Needy Families 93.558 2014ATP0019,270Temporary Assistance for Needy Families 93.558 2015ATP001



Passed Through Education Service Center 20

26,384Temporary Assistance for Needy Families 93.558 $223475502

Total Passed Through Education Service Center 20 26,384$

Passed Through Texas Dept of Human Services

148,611Medicaid Administrative Claiming Program - MAC 93.778 $

Total Passed Through Texas Dept of Human Services 148,611$

TOTAL U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES 205,013$

U.S. DEPARTMENT OF AGRICULTURE

Passed Through the State Department of Agriculture

3,143,825*School Breakfast Program 10.553 $

14,415,500*National School Lunch Program - Cash Assistance 10.5552,390,146*National School Lunch Prog. - Non-Cash Assistance 10.555

211

EXHIBIT K-1 NORTH EAST INDEPENDENT SCHOOL DISTRICT



(1)

Federal

Entity Identifying

(4)

NumberCFDA

ExpendituresFederal

Number

(3)(2)

FEDERAL GRANTOR/


Pass-Through

Total CFDA Number 10.555 16,805,646

327,938*Summer Feeding Program - Cash Assistance 10.5598,993*Non Cash Assistance - Summer Feeding Program 10.559


20,286,402Total Child Nutrition Cluster

49,674Equipment Assistance Grant 10.579

Total Passed Through the State Department of Agriculture 20,336,076$

TOTAL U.S. DEPARTMENT OF AGRICULTURE 20,336,076$

TOTAL EXPENDITURES OF FEDERAL AWARDS 47,932,756$

*Clustered Programs

212


Notes to Schedule of Expenditure of Federal Awards

For the Year Ended June 30, 2015

213

1. For all federal programs, the District uses the fund types specified in the TEA’s Financial Accountability System Resource Guide.

General Fund – is used to account for, among other things, resources related to the United States Department of Defense ROTC program, and the United States Department of Education’s Impact Aid.

Special Revenue Funds – are used to account for resources restricted to, or designated for, specific purposes by a grantor. Federal and state financial assistance generally is accounted for in a Special Revenue Fund. Generally, unused balances are returned to the grantor at the close of specified project periods.

2. The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. The Governmental Fund types are accounted for using a current financial resources measurement focus. All federal grant funds were accounted for either in the General Fund or in the Special Revenue Funds, components of the Governmental Fund Types. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing resources) and decreases (i.e., expenditures and other financing uses) in net current assets.

The modified accrual basis of accounting is used for the Governmental Fund Types. This basis of accounting recognizes revenues in the accounting period in which they become susceptible to accrual (i.e., both measurable and available), and expenditures in the accounting period in which the fund liability is incurred, if measurable, except for certain compensated absences and claims and judgments, which are recognized when the obligations are expected to be liquidated with expendable available financial resources.

Federal grant funds are generally considered to be earned to the extent of expenditures made under the provisions of the grant and, accordingly, when such funds are received, they are recorded as deferred revenues until earned.

3. The period of availability for federal grant funds for the purpose of liquidation of outstanding

obligations made on or before the ending date of the federal project period extended 30 days beyond the federal project period ending date, in accordance with provisions in Section H Period of Availability of Federal Funds, Part 3, OMB Circular A-133 Compliance Supplement.


Notes to Schedule of Expenditure of Federal Awards

For the Year Ended June 30, 2015

214

4. The National School Breakfast and Lunch Programs and the USDA donated commodities are accounted for in the nonmajor governmental funds. The Impact Aid, and ROTC programs are accounted for in the General Fund. Expenditures are not specifically attributable to these revenue sources and are shown on this schedule in an amount equal to revenue for balancing purposes only. The revenue for indirect costs is recognized in the General Fund.

5. The expenditures shown on the Schedule of Expenditures of Federal Awards (SEFA) does not

equal to total federal revenues shown on Exhibit C-3 by the amount of federal revenue recorded in various funds as shown below. These amounts are not subject to the Single Audit Act and are not required to be included in the SEFA.

Amount reported on the Schedule of

Expenditures of Federal Awards $ 47,932,756SHARS Revenue reported in the General Fund 5,866,439E-Rate Revenue reported in the General Fund 23,808Tax Credit Revenue reported in the Debt Service Fund 1,830,973Federal Program Revenue Reported on Exhibit C-3 55,653,976

E-Rate Revenue reported in the Internal Service Funds 966,754Federal Program Revenue Reported on Exhibit D-2 966,754

Total Federal Program Revenue $ 56,620,730

Documents

North East Independent School District San Antonio, Texas ... · San Antonio, Texas Comprehensive Annual Financial Report Year Ended June 30, 2015 Report Issued by the Department