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Somers Central School District, New York

Financial Statements and Supplementary Information

Year Ended June 30, 2015


Table of Contents

Independent Auditors' Report

Management's Discussion and Analysis

Basic Financial Statements District-Wide Financial Statements

Statement of Net Position Statement of Activities

Fund Financial Statements Balance Sheet - Governmental Funds Reconciliation of Governmental Funds Balance Sheet to the District-Wide

Statement of Net Position Statement of Revenues, Expenditures and Changes in Fund Balances -

Governmental Funds Reconciliation of the Statement of Revenues, Expenditures, and Changes

in Fund Balances of Governmental Funds to the Statement of Activities Statement of Revenues, Expenditures and Changes in Fund Balances -

Budget and Actual - General and Special Aid Funds Statement of Assets and Liabilities - Fiduciary Fund

Notes to Financial Statements Required Supplemental Information

Other Post Employment Benefits Schedule of Funding Progress- Last Three Fiscal Years

New York State Teachers' Retirement System Schedule of the School District's Proportionate Share of the Net Pension Liability Schedule of Contributions

New York State and Local Employees Retirement System Schedule of the School District's Proportionate Share of the Net Pension Liability Schedule of Contributions

Combining and Individual Fund Financial Statements and Schedules

Major Governmental Funds General Fund

Page No.

1

3

13 14

15

17

18

20

21 23 24

51

52 53

54 55

Comparative Balance Sheet 56 Comparative Schedule of Revenues, Expenditures and Changes in Fund Balance -

Budget and Actual 57 Schedule of Revenues and Other Financing Sources Compared to Budget 59 Schedule of Expenditures and Other Financing Uses Compared to Budget 61

Special Aid Fund Comparative Balance Sheet 65 Comparative Schedule of Revenues, Expenditures and Changes in Fund Balance -

Budget and Actual 66 Capital Projects Fund

Comparative Balance Sheet 68 Comparative Statement of Revenues, Expenditures and Changes in Fund Balance 69 Project-Length Schedule 70


Table of Contents (Concluded)

Non-Major Governmental Funds Page No.

Combining Balance Sheet 72 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 74 School Lunch Fund

Comparative Balance Sheet 76 Comparative Schedule of Revenues, Expenditures and Changes in

Fund Balance - Budget and Actual 77 Special Purpose Fund

Comparative Balance Sheet 79 Comparative Statement of Revenues, Expenditures and Changes in Fund Balance 80

Debt Service Fund Comparative Balance Sheet 81 Comparative Statement of Revenues, Expenditures and Changes in Fund Balance 82

Supplementary Information Analysis of Change from Adopted Budget to Final Budget 83 Section 1318 of Real Property Tax Law Limit Calculation 83 Schedule of Net Investment in Capital Assets 84

Federal Programs 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 85

Report on Compliance for Each Major Federal Program and Report on Internal Control Over Compliance Required by OMB Circular A-133 87

Schedule of Expenditures of Federal Awards 89 Notes to Schedule of Expenditures of Federal Awards 90 Schedule of Findings and Questioned Costs 91 Summary Schedule of Prior Audit Findings 92

O'CONNOR DAVIES

The Board of Education of the



Report on the Financial Statements

PKF

We have audited the accompanying financial statements of the governmental activities, each major fund and the aggregate remaining fund information of the Somers Central School District, New York ("School District") as of and for the year ended June 30, 2015, and the related notes to the financial statements which collectively comprise the School 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.

Auditors' 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.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the School District's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we express no such opinion . An audit also includes evaluating the appropriateness of accounting policies used and thH 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, each major fund and the aggregate remaining fund information of the School District, as of June 30, 2015, and the respective changes in financial position, thereof, and the respective budgetary comparison for the General and Special Aid Funds for the year then ended in accordance with accounting principles generally accepted in the United States of America.

O'CONNOR DAVIES, LLP

5.00 Mamaroneck Avenue, Suite 301, Harrison, NY 10528 1 Tel: ~H4 . 381.8900 1 Fax: 914.381.8910 1 www.odpkf.com

~r ~~a:~~~n~a;~e:h~~~~ ~f~~;~:~:~,i~d~:i~hu:~~~~~:,"~~~~~~ ti;~~~ed network of legally independent firms and does not accept any responsibility or liability for the actions

Emphasis of Matter

We draw attention to Note 2,D and Note 3,C in the notes to financial statements which disclose the effects of the School District's adoption of the provisions of GASB Statement Nos. 68 "Accounting and Financial Reporting for Pensions" and 71 "Pension Transition for Contributions Made Subsequent to the Measurement Date". 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 Management's Discussion and Analysis and the schedules included under Required Supplementary Information in the accompanying 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.

Supplementary and Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The combining and individual fund financial statements and schedules and the schedule of expenditures of federal awards as required by U.S. Office of Management and Budget Circular A-133 Audits of State, Local Governments and Non-Profit Organizations are presented for purposes of additional analysis and are not a required part of the basic financial statements.

The combining and individual fund financial statements and schedules 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 information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated September 18, 2015 on our consideration of the 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 the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance.

~~~brwta~w O'Connor Davies, LLP Harrison, New York September 18, 2015

2


Management's Discussion and Analysis (MD&A) June 30, 2015

Introduction

Our discussion and analysis of the Somers Central School District, New York's financial performance provides an overview of the School District's financial activities for the year ended June 30, 2015. It should be read in conjunction with the basic financial statements to enhance understanding of the School District's financial performance, which immediately follows this section.

Financial Highlights

Key financial highlights for fiscal year 2015 are as follows:

• New York State Law limits the amount of unreserved fund balance that can be retained by the General Fund to 4% of the ensuing year's budget, exclusive of the amount designated for the subsequent year's budget. At the end of the current fiscal year, the undesignated fund balance of the General Fund was $3,464,761, and this amount was within the statutory limit.

• The School District issued $456,805 of installment purchase debt during the year. The proceeds were used to finance the purchase of computer technology equipment. The School District also retired an additional $3,445,000 serial bonds and $427,736 of installment purchase debt.

• The School Districts governmental fund financial statements report a combined ending fund balance of $9,859,909, an increase of $274,490 over the prior year. The General Fund's unassigned fund balance of $3,464,761 represents about 35% of this total. Also noteworthy about the fund balance is that it includes monies restricted and assigned for debt service of $536,689, which may be used to help offset future debt service obligations, and a Capital Projects Fund fund balance of $306,849. Exclusive of the Debt Service and Capital Projects funds, the combined ending fund balances are $9,016,371.

• Of special note is the fact that the School District was able to budget $1,400,000 as an appropriated surplus contribution to reduce the tax levy associated with the 2014-2015 budget and $760,000 the same purpose with the 2015-2016 budget. Favorable School District financial operations have permitted these management actions in recent years.

• On the district-wide financial statements, the assets and deferred outflows of the School District exceeded liabilities and deferred inflows by $34,437,774. Of this amount, the unrestricted portion is ($1 0, 773,611 ). The Schoof District's total net position increased by $5,320,886 for the year ended June 30, 2015. The district-wide financial statements must report certain items in accordance with the pronouncements of the Governmental Accounting Standards Board ("GASB"). The GASB is charged with developing the accounting rules that apply to governments, including school districts and BOCES. One of the most significant of these standards requires the School District to recognize the financial impact associated with other postemployment benefit ("OPEB") obligations under the provisions of GASB Statement No. 45. These obligations include any benefits provided to retirees, other than a pension, including health insurance, life insurance, vision, dental, etc. GASB Statement No. 45 established standards for accrual based measurement and recognition of OPEB expenses over periods that approximate employees' years of active service, as well as the required note disclosures. For the year ending June 30, 2015, the School District's OPEB obligations of $21,7 40,826 are reflected as a liability on the district-wide Statement of Net Position and impacts the total net position

3

calculation. More detailed information about the School District's OPES obligations reported in accordance with the provisions of GASB Statement No. 45 is presented in note 3, C in the notes to financial statements.

• Also noteworthy on the district-wide financial statements for the year ended June 30, 2015, is the implementation of the provisions of GASB Statement No. 68 for the first time. This pronouncement established new accounting and financial reporting requirements associated with the School District's participation in the cost sharing multiple employer pension plans administered by the New York State and Local Employees' Retirement System ("ERS") and the New York State Teachers' Retirement System ("TRS") . Under the new standards, cost-sharing employers are required to report in their district-wide financial statements a net pension liability (asset), pension expense and pension-related deferred inflows and outflows of resources based on their proportionate share of the collective amounts for all of the municipalities and school districts in the plan. At June 30, 2015, the School District reported in its Statement of Net Position a liability of $890,186 for its proportionate share of the ERS net pension liability, while also reporting a pension asset of $26,046,890 for its proportionate share of the TRS net pension asset. More detailed information about the School District's pension plan reporting in accordance with the provisions of GASB Statement No. 68, including amounts reported as pension expense and deferred inflows/outflows of resources, is presented in note 3, C in the notes to financial statements. The cumulative effect of this change in accounting principle accounted for $6,430,747 of the $11,751,633 increase in net position over the prior year.

Overview of the Financial Statements

This discussion and analysis is intended to serve as an introduction to the School District's basic financial statements. The School District's basic financial statements are comprised of three components: (1) district-wide financial statements, (2) fund financial statements and (3) notes to the financial statements. This report also contains individual fund statements and schedules in addition to the basic financial statements.

District-Wide Financial Statements

• The district-wide financial statements are designed to provide readers with a broad overview of the School District's finances, in a manner similar to a private-sector business.

• The statement of net position presents information on all of the School District's assets, liabilities and deferred inflows/outflows of resources, with the difference between the two reported as net position. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the School District is improving or deteriorating.

• The statement of activities presents information showing how the government's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows.

• The governmental activities of the School District include instruction, pupil transportation, cost of food sales, other, interest and general support.

The district-wide financial statements can be found on the pages immediately following this section as the first two pages of the basic financial statements.

4

Fund Financial Statements

• A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The School District, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. All of the funds of the School District can be divided into two categories: governmental funds and fiduciary funds.

• Governmental funds are used to account for essentially the same functions reported as governmental activities in the district-wide financial statements. However, unlike the district-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating the School District's near-term financing requirements.

• Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the district-wide financial statements. By doing so, readers may better understand the long-term impact of the government's near term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

• The School District maintains six individual governmental funds; General Fund, Special Aid Fund, School Lunch Fund, Special Purpose Fund, Debt Service Fund and Capital Projects Fund. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for each fund, since the School District has elected to report them as major funds.

• The School District adopts an annual budget for its General Fund, Special Aid Fund, School Lunch Fund and Debt Service Fund. A budgetary· comparison statement has been provided for the General, Special Aid and School Lunch funds within the basic financial statements to demonstrate compliance with the respective budgets.

• The Fiduciary Funds are used to account for assets held by the School District in an agency capacity, which accounts for assets held by the School District on behalf of others. Fiduciary funds are not reflected in the district-wide financial statements because the resources of these funds are not available to support the School District's programs.

The financial statements for the governmental and fiduciary funds can be found in the basic financial statements section of this report.

Notes to the Financial Statements

The notes provide additional information that is essential to a full understanding of the data provided in the district-wide and fund financial statements. The notes to the financial statements can be found following the basic financial statements section of this report.

District-Wide Financial Analysis

As noted earlier, net assets may serve over time as a useful indicator of the School District's financial position. In the case of the Somers Central School District, New York, assets and deferred outflows of resources exceeded liabilities by $34,437,77 4 at the close of the current fiscal ye.ar.

5

Net Position

June 30, 2015 2014

Current Assets $ 17,946,884 $ 17,365,910 Non-Current Assets 26,046,890 Capital Assets, net 76,864,096 78,905,639

Total Assets 120,857,870 96,271,549

Deferred Outflows of Resources 7,726,791 100,538

Current Liabilities 8,514,935 8,168,750 Long-term Liabilities 67,757,746 65,517,196

Total Liabilities 76,272,681 73,685,946

Deferred Inflows of Resources 17,874,206

NET POSITION Net Investment in Capital Assets 39,835,515 31,581,626 Restricted

Debt Service 536,689 729,241 Capital Costs 1,258,707 865,707 Tax Certiorari 2,404,094 1,774,564 Retirement contributions 405,000 405,000 School Lunch 423,189 342,082 Special Purposes 41,342 43,446 Capital Projects 306,849 364,631

Unrestricted (10,773,611) (13,420, 153)

Total Net Position $ 34,437,774 $ 22,686,144

By far, the largest component of the School District's net position 116% reflects its investment in capital assets, less any related debt used to acquire those assets that is still outstanding. The School District uses these capital assets to provide services to the students and consequently, these assets are not available for future spending. Although the School District's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

Those assets subject to external restrictions constitute 16% of net position. The remaining balance is unrestricted net position, which is $(1 0, 773,611 ).

6

Changes in Net Assets

June 30, 2015 2014

REVENUES Program Revenues

Charges for Services $ 1,736,673 $ 1,706,502 Operating Grants and Contributions 2,140,009 2,211,359 Capital Grants and Contributions 7,448 24,248

Total Program Revenues 3,884,130 3,942,109

General Revenues Real Property Taxes 62,354,769 61,246,828 Other Tax Items 11,228,301 11,215,061 Non-Property Taxes 1,009,679 1,012,402 Unrestricted Use of Money and Property 21,450 36,131 Sale of Property and Compensation for Loss 19,384 1,714 Unrestricted State Aid 8,323,089 7,372,325 Miscellaneous 313,018 285,702

Total General Revenues 83,269,690 81 ,170,163

Total Revenues 87 ,153,820 85,112,272

PROGRAM EXPENSES General Support 9,461,056 9,956,013 Instruction 64,069,347 68,726,032 Pupil Transportation 5,542,973 5,311,842 Community services 17,172 30,903 Cost of Food Sales 1 t 149,746 1 '182,757 Other 5,800 5,700 Interest 1,586,840 1,926,216

Total Expenses 81 ,832,934 87,139,463

Change in Net Position 5,320,886 {2,027,191}

NET POSITION Beginning, as reported 22,686,141 24,713,332

Cumulative Effect of Change in Accounting Principle 6,430,747

Net Position, as restated 29,116,888 24,713,332

Ending $ 34,437,774 $ 22,686,141

Governmental activities increased the School District's net position by $5,320,886. As indicated on the following graphs, the School District relies upon real property taxes as its primary revenue source. The School District's instruction costs account for 78% of its expenses.

• Real property taxes increased by $1,107,941 as a result of a higher tax levy. • Other tax items increased by $13,240 representing an increase in the School Tax Relief Reim

bursement Program . • Unrestricted State aid increased by $950,764 as a result of an increase in General Aid and

BOCES aid.

7

Expenses decreased by $5,306,529 during the 2014-15 fiscal year. The Instruction accounted for a decrease of $4.7 million. The decrease is attributable to the implementation of GASB 68. The General Support category decreased by $494,957. Transportation increased $231,131. Interest decreased $339,376.

Sources of Revenue for Fiscal Year 2015 Governmental Activities

Miscellaneous and Other

Operating Grants and

Contributions 2%

Charges for Services

2%

Unrestricted State Aid

9% Real Property Taxes 72% Non-Property

Taxes

Other Tax Items 13%

Program Expenses for Fiscal Year 2015 Governmental Activities

Debt Service Interest

2%

Cost of Food Sales

8

Pupil Transportation

7%

Instruction 78%

1%

Financial Analysis of the School District's Funds

As noted earlier, the School District uses fund accounting to ensure and demonstrate compliance with finance related legal requirements.

Fund Balance Reporting

It is noteworthy to report that the Governmental Accounting Standards Board ("GASB") issued Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions in February 2009. The requirements of GASB Statement No. 54 are effective for financial statements for periods ending June 30, 2015. GASB Statement No. 54 abandons the reserved and unreserved classifications of fund balance and replaces them with five new classifications: nonspendable, restricted, committed, assigned and unassigned. An explanation of these classifications follows below.

Nonspendable - consists of assets that are inherently nonspendable in the current period either because of their form or because they must be maintained intact, including prepaid items, inventories, long-term portions of loans receivable, financial assets held for resale, and principal of endowments.

Restricted - consists of amounts that are subject to externally enforceable legal purpose restrictions imposed by creditors, grantors, contributors, or laws and regulations of other governments; or through constitutional provisions or enabling legislation.

Committed - consists of amounts that are subject to a purpose constraint imposed by a formal action of the government's highest level of decision-making authority before the end of the fiscal year, and that require the same level of formal action to remove the constraint.

Note: According to the Office of the State Comptroller, school districts in New York will not have committed fund balance to report.

Assigned - consists of amounts that are subject to a purpose constraint that represents an intended use established by the government's highest level of decision-making authority, or by their designated body or official. The purpose of the assignment must be narrower than the purpose of the General Fund, and in funds other than the General Fund, assigned fund balance represents the residual amount of fund balance.

Unassigned - represents the residual classification for the government's General Fund, and could report a surplus or deficit. In funds other than the General Fund, the unassigned classification should be used only to report a deficit balance resulting from overspending for specific purposes for which amounts had been restricted, committed, or assigned.

These changes were made to reflect spending constraints on resources, rather than availability for appropriations and to bring greater clarity and consistency to fund balance reporting. This pronouncement should result in an improvement in the usefulness of fund balance information.

Governmental Funds

The focus of the School District's governmental funds is to provide information on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing the School District's financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year.

9

As of the end of the current fiscal year, the School District's governmental funds reported combined fund balances of $9,859,909 an increase of $274,490 over the prior year.

The General Fund is the primary operating fund of the School District. At the end of the current fiscal year, the total fund balance of the General Fund was $8,451,840 of which $3,464,761 was unassigned. As previously mentioned, New York State Law limits the amount of unassigned fund balance that can be retained to 4% of the ensuing year's budget, exclusive of the amount designated for the subsequent year's budget.

The fund balance of the School District's General Fund increased by $345,821 during the current fiscal year.

General Fund Budgetary Highlights

The increase in Revenues from the budgetary estimates of $366,973 was due from an increase in state aid, miscellaneous and charges for services. Expenditures were $2,201 ,420 below the final budget, resulting from a .savings in general support, debt service, pupil transportation, instructional costs and employee benefits.

The table on the following page outlines the various balances that comprise the total fund balance as of June 30, 2015 according to their GASB Statement No. 54 classifications along with what the former classifications would have been. More detailed information about the School District's fund balance is presented in note 3, F. in the notes to financial st~tements.

10

Total Fund Balance Classifications

GASB Statement No. 54 Fund Classification Previous Classifications Balance

Nonspendable Fund Balance Reserved for Prepaid Expenditures $ 6,800 Reserved for Inventories 26,502

33,302

Restricted Fund Balance Reserved for Tax Certiorari 2,404,094 Reserved for Employee Benefit Accrued Liability 88,786 Reserved for Retirement Contributions 405,000 Reserved for Debt Service 536,689 Capital Costs 1,258,707 Capital Projects 306,849 Reserved for Trusts (Special Purpose Fund) 41,342

5,041,467

Reserved for Encumbrances - General Government Support 30,771 Assigned Fund Balance Reserved for Encumbrances - Instruction 21,445

Reserved for Encumbrances - Employee Benefits 11,476 School Lunch Fund Unreserved Fund Balance 396,687 Designated for subsequent year's expenditures 860,000

1,320,379

Unassigned Fund Balance Unreserved and Undesignated - General Fund 3,464,761

Total Fund Balance (as of 6/30/15) $ 9,859,909

Capital Assets

At June 30, 2015 the School District had $78,864,096 net of accumulated depreciation invested in a broad range of capital assets, including land, buildings and improvements, machinery and equipment and construction in progress. The change in capital assets, net of accumulated depreciation, is reflected below.

June 30, 2015 2014

Land $ 304,442 $ 304,442 Buildings and Improvements 75,866,833 77,907,545 Machinery and Equipment 692,821 693,652

Total Capital Assets, net of accumulated depreciation $ 76,864,096 $ 78,905,639

More detailed information about the School District's capital assets is presented in the notes to the financial statements.

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Long-Term Debt

At June 30, 2015 and 2014, the School District had general obligation and other long-term debt outstanding, as follows:

Bonds Payable Installment Purchase Debt Compensated Absences Net Pension Liability Other Post Employment

Benefit Obligations Payable

Total

$

$

June 30, 2015 2014

44,305,014 $ 47,003,262 450,358 421,289 371,362 354,975 890,186

21,740,826 17,737,670

67,757,746 $ 65,517,196

The School Districts issued $456,805 of installment purchase debt during the 2014-15 fiscal year. The School District redeemed $3,445,000 of serial bonds and $427,736 installment purchase debt.

More detailed information about the School District's long-term liabilities is presented in the notes to the financial statements.

Requests for Information

This financial report is designed to provide a general overview of the School District's finances for all those with an interest in the School District's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to:

Somers Central School District Attn: Kenneth Crowley

Assistant Superintendent for Business PO Box 620

Lincolndale, New York 10540

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Statement of Net Position June 30, 2015

ASSETS Cash and equivalents Investments Receivables

Accounts State and Federal aid Due from other governments

Inventories Prepaid expenses Net pension asset Capital assets

Not being depreciated Being depreciated, net

Total Assets

DEFERRED OUTFLOWS OF RESOURCES

LIABILITIES Current liabilities

Accounts payable Unearned revenues Due to other governments Due to retirement systems Accrued interest payable Non-current liabilities

Due within one year Due in more than one year

Total Liabilities

DEFERRED INFLOWS OF RESOURCES

NET POSITION Net investment in capital assets Restricted

Debt service Tax certiorari Retirement contributions Capital costs School lunch Special purposes Capital projects

Unrestricted

Total Net Position

The notes to the financial statements are an integral part of this statement. 13

Governmental Activities

$ 16,050,494 2,519

$

59,469 757,737

1,043,363 26,502

6,800 26,046,890

304,442 76,559,654

120,857,870

7,726,791

1,046,820 111,456 71,627

6,857,072 427,960

3,605,107 64,152,639

76,272,681

17,874,206

39,835,515

536,689 2,404,094

405,000 1,258,707

423,189 41,342

306,849 (1 0,773,611)

34,437,774

(This page intentionally left blank)


Statement of Activities Year Ended June 30, 2015

Functions/Programs Governmental activities

General support Instruction Pupil transportation Community services Cost of food sales Other Interest

Total Governmental Activities

Pro~ram Revenues Operating

Charges for Grants and Expenses Services Contributions

$ 9,461,056 $ 72,678 $ 105,333 64,069,347 629,034 1,676,061

5,542,973 167,815 17,172

1,149,746 1,034,961 187,104 5,800 3,696

1,586,840

$ 81,832,934 $ 1,736,673 $ 2,140,009

General revenues Real property taxes Other tax items

School tax relief reimbursement Non-property taxes Non-property tax distribution from County

Unrestricted use of money and property Sale of property and compensation for loss Unrestricted State aid Miscellaneous

Total General Revenues

Change in Net Position

Net Position- Beginning, as reported

Cumulative Effect of Change in Accounting Principle

Net Position - Beginning, as restated

Net Position - Ending

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

14

Net (Expense) Capital Revenue and

Grants and Changes in Contributions Net Position

$ $ (9,283,045) (61,764,252)

(5,375,158) (17,172) 72,319 (2,104)

7,448 (1,579,392)

$ 7,448 (77,948,804)

62,354,769

11,228,301

1,009,679 21,450 19,384

8,323,089 313,018

83,269,690

5,320,886

22,686,141

6,430,747

29,116,888

$ 34,437,774


Balance Sheet Governmental Funds June 30, 2015

ASSETS Cash and equivalents Investments Receivables Accounts State and Federal aid Due from other governments Due from other funds

Inventories Prepaid expenditures

Total Assets

LIABILITIES AND FUND BALANCES Liabilities Accounts payable Unearned revenues Due to other governments Due to other funds Due to retirement systems

Total Liabilities

Fund balances Nonspendable Restricted Assigned Unassigned

Total Fund Balances

Total Liabilities and Fund Balances

$

$

$

$

Special General Aid

13,827,583 $ 982,091 197 425

59,332 334,420 410,003

1,043,363 1,372,971

6,800

16,644,666 $ 1,392,519

920,079 $ 103,570 31,490 32,092 70,419

313,766 1,256,857 6,857,072

8,192,826 1,392,519

6,800 4,156,587

823,692 3,464,761

8,451 ,840

16,644,666 $ 1,392,519


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Capital Projects

$ 746,372

313,766

$ 1,060,138

$ 16,600

736,689

753,289

306,849

306,849

$ 1,060,138

Total Other Governmental

Governmental Funds

$ 494,448 $ 16,050,494 1,897 2,519

137 59,469 13,314 757,737

1,043,363 736,689 2,423,426

26,502 26,502 6,800

$ 1,272,987 $ 20,370,310

$ 6,571 $ 1,046,820 47,874 111,456

1,208 71,627 116,114 2,423,426

6,857,072

171,767 10,510,401

26,502 33,302 578,031 5,041,467 496,687 1,320,379

3,464,761

1,101 ,220 9,859,909

$ 1,272,987 $ 20,370,310

16



Reconciliation of Governmental Funds Balance Sheet to the District-Wide Statement of Net Position

June 30, 2015

Fund Balances -Total Governmental Funds

Amounts Reported for Governmental Activities in the Statement of Net Position are Different Because:

Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds.

Governmental funds do not report the effect of losses on refunding bonds and assets or liabilities related to net pension assets (liabilities) whereas these amounts are deferred and amortized in the statement of activities.

Deferred amounts on refunding bonds Deferred amounts on net pension assets (liabilities)

Other long term assets are not available to pay for current period expenditures and, therefore, are not reported in the funds.

Pension assets

Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the funds.

Accrued interest payable Bonds payable Installment purchase debt payable Compensated absences Net pension liability Other post employment benefit obligations payable

Net Position of Governmental Activities


17

$

$

9,859,909

76,864,096

750,630 (10,898,045)

(10,147,415)

26,046,890

(427,960) (44,305,014)

(450,358) (371 ,362) (890, 186)

(21 ,740,826)

(68,185,706)

34,437,774


Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds Year Ended June 30, 2015

Special Capital General Aid Projects

REVENUES Real property taxes $ 62,354,769 $ $ Other tax items 11,228,301 Non-property taxes 1,009,679 Charges for services 629,034 Use of money and property 94,128 Sale of property and compensation for loss 19,384

lnterfund revenues 7,176 State aid 8,630,623 438,778 Federal aid 14,029 1,184,168 Food sales Miscellaneous 317,718

Total Revenues 84,304,841 1,622,946

EXPENDITURES Current

General support 7,561,743 100,633 Instruction 44,449,825 1,439,034 Pupil transportation 5,100,900 167,815 Community services 17,172 Employee benefits 20,970,783 Cost of food sales Other

Debt service Principal 3,872,736 Interest 1,683,451 Refunding bond issuance costs

Capital outlay 832,461

Total Expenditures 83 ,656,610 1,707,482 832,461

Excess (Deficiency) of Revenues Over Expenditures 648,231 (84,536~ {832,461)

OTHER FINANCING SOURCES (USES) Refunding bonds issued Premium on bonds issued Payment to refunded bond

escrow agent Installment purchase debt issued 456,805 Transfers in 100,000 84,536 317,874 Transfers out (402,41 0}

Total Other Financing Sources (Uses) (302,410~ 84,536 774,679

Net Change in Fund Balances 345,821 (57,782)

FUND BALANCES Beginning of Year 8,106,019 364,631

End of Year $ - 8,451,840 $ $ 306.849


18

Total Other Governmental

Governmental Funds

$ $ 62,354,769 11,228,301

1,009,679 629,034

654 94,782

19,384 7,176

14,225 9,083,626 172,483 1,370,680

1,034,961 1,034,961 10,886 328,604

1,233,209 87,160,996

7,662,376 45,888,859

5,268,715 17,172

20,970,783 1 '140,958 1,140,958

5,800 5,800

3,872,736 1,683,451

232,972 232,972 832,461

1,379,730 87,576,283

(146,521) (415,287)

17,150,000 17,150,000 1,466,281 1,466,281

(18,383,309) (18,383,309) 456,805 502,410

(100,000) (502,41 0)

132,972 689,777

(13,549) 274,490

1,114,769 9,585,419

$ 1,101,220 $ 9,859,909

19



Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities

Year Ended June 30, 2015

Amounts Reported for Governmental Activities in the Statement of Activities are Different Because:

Net Change in Fund Balances- Total Governmental Funds

Governmental funds report capital outlay as expenditures. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which depreciation expense exceeded capital outlay in the current period. This amount may be less than the total capital outlay since capital outlay includes amounts under the capitalization threshold.

Capital outlay expenditures Depreciation expense

Debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net position. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position.

Refunding bonds issued Premium on bonds issued Payment to refunded bond escrow agent Principal paid on serial bonds Principal paid on installment purchase debt Installment purchase debt issued Amortization of loss on refunding and issuance premium

Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds.

Accrued interest Compensated absences Pension assets (liabilities) Other post employment benefit obligations

Change in Net Position of Governmental Activities


20

$

$

274,490

206,037 (2,247,580)

(2,041,543)

(17, 150,000) (1 ,466,281) 18,383,309 3,445,000

427,736 (456,805) 136,312

3,319,271

(39,701) (16,387)

7,827,912 (4,003, 156)

3,768,668

5,320,886


Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual

General and Special Aid Funds Year Ended June 30, 2015

General Fund Variance with Final Budget

Original Final Positive Budget Budget Actual {Negative}

REVENUES Real property taxes $ 62,432,388 $ 62,332,388 $ 62,354,769 $ 22,381 Other tax items 11,242,961 11 ,242,961 11,228,301 (14,660) Non-property taxes 978,500 978,500 1,009,679 31 ,179 Charges for services 528,000 528,000 629,034 101,034 Use of money and property 132,500 132,500 94,128 (38,372) Sale of property and com-pensation for loss 19,384 19,384

lnterfund revenues 9,500 9,500 7,176 (2,324) State aid 8,460,861 8,488,311 8,630,623 142,312 Federal aid 12,500 12,500 14,029 1,529 Miscellaneous 208,508 213,208 317,718 104,510

Total Revenues 84,005,718 83,937,868 84,304,841 366,973

EXPENDITURES Current General support 7,486,709 7,875,873 7,561 ,743 314,130 Instruction 45,474,298 45,563,838 44,449,825 1,114,013 Pupil transportation 5,151,420 5,159,322 5,100,900 58,422 Community services 84,439 44,862 17,172 27,690 Employee benefits 21,557,542 21,548,630 20,970,783 577,847

Debt service Principal 3,782,736 3,872,736 3,872,736 Interest 1,942,547 1,852,547 1,683,451 169,096

Total Expenditures 85,479,691 85,917,808 83,656,610 2,261 ,198

Excess (Deficiency) of Revenues Over Expenditures (1,473,973) (1,979,940) 648,231 2,628,171

OTHER FINANCING SOURCES (USES) Transfers in 100,000 100,000 100,000 Transfers out (92,475) (406,324) (402,410) 3,914

Total Other Financing Sources (Uses) 7,525 (306,324) (302,41 0) 3,914

Net Change in Fund Balances (1,466,448) (2,286,264) 345,821 2,632,085

FUND BALANCES Beginning of Year 1,466,448 2,286,264 8,106,019 5,819,755

End of Year $ $ $ 8,451,840 $ 8,451,840


21

$

$

Original Budget

515,025 1,160,052

1,675,077

157,500 1,446,945

163,107

1,767,552

(92,475)

92,475

92,475

$

$

Special Aid Fund

Final Budget

519,050 1,184,168

1,703,218

157,500 1,466,353

167,815

1,791,668

(88,450)

88,450

88,450

$

$

Actual

438,778 1,184,168

1,622,946

100,633 1,439,034

167,815

1,707,482

(84,536)

84,536

84,536

Variance with Final Budget

Positive (Negative)

$

$

(80,272)

(80.272)

56,867 27,319

84,186

3,914

(3,914)

(3,914)

22


Statement of Assets and Liabilities Fiduciary Fund June 30, 2015

ASSETS Cash and equivalents

LIABILITIES Accounts payable Employee payroll deductions Deposits Student activity funds

Total Liabilities


23

Agency

$ 174,862

$ 3,115 14,838 67,212 89,697

$ 174,862


Notes to Financial Statements June 30 2015

Note 1 - Summary of Significant Accounting Policies

The Somers Central School District, New York ("School District"), as presently constituted, was established in 1909 and operates in accordance with the provisions of the Education Law of the State of New York. The Board of Education is the legislative body responsible for overall operation of the School District and is elected by the voters of the School District. The Superintendent serves as the chief executive officer. The School District's primary function is to provide education for its pupils. Services such as transportation of pupils, administration, finance and plant maintenance support the primary function.

The accounting policies of the School District conform to generally accepted accounting principles for local governmental units and the Uniform System of Accounts as prescribed by the State of New York. The Governmental Accounting Standards Board ("GASB") is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The following is a summary of the School District's more significant accounting policies:

A. Financial Reporting Entity

The financial reporting entity consists of a) the primary government, which is the School District, b) organizations for which the School District is financially accountable and c) other organizations for which the nature and significance of their relationship with the School District are such that exclusion would cause the reporting entity's financial statements to be misleading or incomplete as set forth by GASB.

In evaluating how to define the School District, for financial reporting purposes, management has considered all potential component units. The decision to include a potential component unit in the School District's reporting entity was made by applying the criteria set forth by GASB, including legal standing, fiscal dependency and financial accountability. Based upon the application of these criteria, there are no other entities which would be included in the financial statements.

The School District participates in the Putnam - Northern Westchester Board of Cooperative Educational Services ("BOCES"). BOCES is a voluntary cooperative association of school districts in a geographic area that share planning, services and programs, which provide education and support services. BOCES' governing board is elected based on the vote of members of the participating districts' governing boards. BOCES' budget is comprised of separate budgets for administrative, program and capital costs. BOCES charges the districts for program costs based on participation and for administrative and capital costs. Each component school district's share of administrative and capital costs is determined by the ratio by which the component school district's full value of taxable properties in effect at the time of adoption bears to the total full value of taxable properties of the component school districts within the BOCES as defined by Education Law. Copies of BOCES' financial statements can be requested from Putnam-Northern Westchester BOCES, Yorktown Heights, New York 10598.

B. District-Wide Financial Statements

The district-wide financial statements (i.e., the Statement of Net Position and the Statement of Activities) report information on all non-fiduciary activities of the School District as a whole. For the most part, the effect of interfund activity has been removed from these statements, except for interfund services provided and used.

24


Notes to Financial Statements (Continued) June 30 2015

Note 1 - Summary of Significant Accounting Policies (Continued)

The Statement of Net Position presents the financial position of the School District at the end of its fiscal year. The Statement of Activities demonstrates the degree to which direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include (1) charges to customers or applicants who purchase, use or directly benefit from goods or services, or privileges provided by a given function or segment, (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment and (3) interest earned on grants that is required to be used to support a particular program. Taxes and other items not identified as program revenues are reported as general revenues. The School District does not allocate indirect expenses to functions in the Statement of Activities.

Separate financial statements are provided for governmental funds and fiduciary funds even though the latter is excluded from the district-wide financial statements. Major individual governmental funds are reported as separate columns in the fund financial statements.

C. Fund Financial Statements

The accounts of the School District are organized and operated on the basis of funds. A fund is an independent fiscal and accounting entity with a self-balancing set of accounts which comprise its assets, deferred outflows of resources, liabilities, deferred inflows of resources, fund balances/net position, revenues and expenditures/expenses. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance related legal and contractual provisions. The School District maintains the minimum number of funds consistent with legal and managerial requirements. The focus of governmental fund financial statements is on major funds as that term is defined in professional pronouncements. Each major fund is to be presented in a separate column, with non-major funds, if any, aggregated and presented in a single column. Fiduciary funds are reported by type. Since the governmental fund statements are presented on a different measurement focus and basis of accounting than the district-wide statements' governmental activities column, a reconciliation is presented on the pages following, which briefly explains the adjustments necessary to transform the fund based financial statements into the governmental activities column of the district-wide presentation. The School District's resources are reflected in the fund financial statements in two broad fund categories, in accordance with generally accepted accounting principles as follows:

Fund Categories

a. Governmental Funds - Governmental Funds are those through which most general government functions are financed. The acquisition, use and balances of expendable financial resources and the related liabilities are accounted for through governmental funds. The following represents the School District's major governmental funds.

General Fund - The General Fund constitutes the primary operating fund of the School District and is used to account for and report all financial resources not accounted for and reported in another fund.

25




Special Revenue Funds - Special revenue funds are used to account for and report the proceeds of specific revenue sources that are assigned, restricted or committed to expenditures for specified purposes other than debt service or capital projects. The major special revenue fund of the School District is the Special Aid Fund. The Special Aid Fund is used to account for special projects or programs supported in whole or in part with Federal or State funds.

Capital Projects Fund - The Capital Projects Fund is used to account for and report financial resources that are restricted, committed or assigned to expenditures for capital outlays, including the acquisition or construction of major capital facilities and other capital assets.

The School District also reports the following non-major governmental funds.

Special Revenue Funds:

School Lunch Fund - The School Lunch Fund is used to record the operations of the breakfast and lunch programs of the School District.

Special Purpose Fund - The Special Purpose Fund is used to account for assets held by the School District in accordance with the terms of a trust agreement.

Debt Service Fund - The Debt Service Fund is used to account for and report financial resources that are restricted, committed or assigned to expenditures for principal and interest, and for financial resources that are being accumulated for principal and interest maturing in future years.

b. Fiduciary Funds (Not Included in District-Wide Financial Statements) - Fiduciary Funds are used to account for assets held by the School District in an agency capacity on behalf of others. Among the activities included in the Agency Fund are the student activity funds. The Agency Fund is also utilized to account for payroll tax withholdings that are payable to other jurisdictions.

D. Measurement Focus, Basis of Accounting and Financial Statement Presentation

The accounting and financial reporting treatment is determined by the applicable measurement focus and basis of accounting. Measurement focus indicates the type of resources being measured such as current financial resources (current assets less current liabilities) or economic resources (all assets and liabilities). The basis of accounting indicates the timing of transactions or events for recognition in the financial statements.

The district-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. The Agency Fund has no measurement focus but utilizes the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of 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.

26



Note 1 -Summary of Significant Accounting Policies (Continued)

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. Property taxes are considered to be available if collected within sixty days of the fiscal year end. A ninety day availability period is used for revenue recognition for most other governmental fund revenues. Property taxes associated with the current fiscal period as well as charges for services and intergovernmental revenues are considered to be susceptible to accrual and have been recognized as revenues of the current fiscal period. Fees and other similar revenues are not susceptible to accrual because generally they are not measurable until received in cash. If expenditures are the prime factor for determining eligibility, revenues from Federal and State grants are accrued when the expenditure is made. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences, net pension liability and other post employment benefit obligations are recorded only when payment is due. General capital asset acquisitions are reported as expenditures in governmental funds. Issuance of long-term debt and acquisitions under capital leases are reported as other financing sources.

E. Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position or Fund Balances

Deposits, Investments and Risk Disclosure

Cash and Equivalents - Cash and equivalents consist of funds deposited in demand deposit accounts, time deposit accounts and certificates of deposit with original maturities of less than three months.

The School District's deposits and investment policies are governed by State statutes. The School District has adopted its own written investment policy which provides for the deposit of funds in FDIC insured commercial banks or trust companies located within the State. The School District is authorized to use demand deposit accounts, time deposit accounts and certificates of deposit. Permissible investments include obligations of the U.S. Treasury, U.S. Agencies and obligations of New York State or its political subdivisions.

Collateral is required for demand deposit accounts, time deposit accounts and certificates of deposit at 100% of all deposits not covered by Federal deposit insurance. The School District has entered into custodial agreements with the various banks which hold their deposits. These agreements authorize the obligations that may be pledged as collateral. Such obligations include, among other instruments, obligations of the United States and its agencies and obligations of the State and its municipal and school district subdivisions.

Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. GASB Statement No. 40 directs that deposits be disclosed as exposed to custodial credit risk if they are not covered by depository insurance and the deposits are either uncollateralized, collateralized by securities held by the pledging financial institution or collateralized by securities held by the pledging financial institution's trust department but not in the School District's name. The School District's aggregate bank balances that were not covered by depository insurance were not exposed to custodial credit risk at June 30, 2015.

27


Notes to Financial Statements (Continued) June 30 201 5


Investments - The School District participates in the Cooperative Liquid Assets Securities System ("CLASS"), a cooperative investment pool, established pursuant to General Municipal Law that meets the definition of a 2 a 7 - like pool. In accordance with the provisions of General Municipal Law, Article 3A, CLASS has designated PT Asset Management, a subsidiary of Public Trust Advisors, LLC as its registered investment advisor. Public Trust Advisors, LLC is registered with the Securities and Exchange Commission ("SEC"), and is subject to all of the rules and regulations of an investment advisor handling public funds. As such, the SEC provides regulatory oversight of CLASS.

The pool is authorized to invest in various securities issued by the United States and its agencies. The amount represents the amortized cost of the cooperative shares and is considered to approximate fair value . The School District's position in the pool is equal to the value of the pool shares. Additional information concerning the cooperative is presented in the annual report of CLASS, which may be obtained from Public Trust Advisors, LLC, 999 181

h Street, Suite 1230, Denver CO 80202.

CLASS is rated AAAm by Standard & Poor's Ratings. Local government investment cooperatives in this rating category meet the highest standards for credit quality, conservative investment policies and safety of principal. The cooperative invests in a high quality portfolio of investments legally permissible for municipalities and school districts in the State.

The School District was invested only in the above mentioned obligations and, accordingly, was not exposed to any interest rate or credit risk.

Property Taxes Receivable - Real property taxes attach as an enforceable lien on real property as of July 1st and are levied and payable in September and January. The town which is included in the levy is responsible for the billing and collection of the taxes. The town guarantees the full payment of the School District warrant and assumes responsibility for uncollected taxes.

Other Receivables - Other receivables include amounts due from other governments and individuals for services provided by the School District. Receivables are recorded and revenues recognized as earned or as specific program expenditures are incurred. Allowances are recorded when appropriate.

Due From/To Other Funds- During the course of its operations, the School District has numerous transactions between funds to finance operations, provide services and construct assets. To the extent that certain transactions between funds had not been paid or received as of June 30, 2015, balances of interfund amounts receivable or payable have been recorded in the fund financial statements.

Inventories - Inventories in the School Lunch Fund consist of surplus food which is recorded at a stated value, which approximates market. The cost is recorded as inventory at the time individual inventory items are purchased. The School District uses the consumption method to relieve inventory. In the fund financial statements, reported amounts are equally offset by a reservation of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of current assets.

28




Prepaid Expenses/Expenditures - Certain payments to vendors reflect costs applicable to future accounting periods, and are recorded as prepaid items using the consumption method in both the district-wide and fund financial statements. Prepaid expenses/expenditures consist of certain costs which have been satisfied prior to the end of the fiscal year, but represent items which have been provided for in the subsequent year's budget and will benefit such periods. Reported amounts are equally offset by nonspendable fund balance in the fund financial statements, which indicates that these amounts do not constitute "available spendable resources" even though they are a component of current assets.

Capital Assets - Capital assets, which include property, plant and equipment, are reported in the governmental activities column in the district-wide financial statements. Capital assets are defined by the School 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 market value at the date of donation.

Major outlays for capital assets and improvements are capitalized as projects are constructed. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives is not capitalized.

Land and construction-in-progress are not depreciated. Property, plant and equipment of the District are depreciated using the straight line method over the following estimated useful lives.

Class

Buildings and Improvements Machinery and Equipment

Life in Years

20-50 5-20

The costs associated with the acquisition or construction of capital assets are shown as capital outlay expenditures on the governmental fund financial statements. Capital assets are not shown on the governmental fund balance sheets.

Unearned Revenues - Unearned revenues arise when assets are recognized before revenue recognition criteria has been satisfied. In district-wide financial statements, unearned revenues consist of amounts received in advance and/or amounts from grants received before the eligibility requirements have been met.

Unearned revenues in the fund financial statements are those where asset recognition criteria have been met, but for which revenue recognition criteria have not been met. The School District has reported unearned revenues of $31,490 for summer camp fees received in advance in the General Fund, $32,092 for State and Federal aid received in advance in the Special Aid Fund and $47,874 for unused meal deposits in the School Lunch Fund. Such amounts have been deemed to be measurable but not "available" pursuant to generally accepted accounting principles.

Deferred Outflows/Inflows of Resources - 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 represents a consumption of net position that applies to a future period and so will not be recognized as an outflow of resources (expense/expenditure) until then.

29




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 represents an acquisition of net position that applies to a future period and so will not be recognized as an inflow of resources (revenue) until that time.

The School District reported deferred outflows of resources of $750,630 for a deferred loss on refunding bonds in the government-wide Statement of Net Position. This amount results from the difference in the carrying amount of the refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt.

The School District also reports deferred outflows of resources and deferred inflows of resources in relation to its pension obligations. These amounts are detailed in the discussion of the School District's pension plans in Note 3,C.

Long-Term Liabilities - In the district-wide financial statements, long-term debt and other longterm obligations are reported as liabilities in the Statement of Net Position. Bond premiums and discounts are deferred and amortized over the life of the bonds. Bonds payable are reported net of the applicable premium or discount. Bond issuance costs are expended as incurred.

In the fund financial statements, governmental funds 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 Fund or Capital Projects funds expenditures.

Compensated Absences- The various collective bargaining agreements provide for the payment of accumulated vacation leave upon separation from service. The liability for such accumulated leave is reflected in the district-wide statement of net assets as current and long-term liabilities. A liability for these amounts is reported in the governmental funds only if the liability has matured through employee resignation or retirement. The liability for compensated absences includes salary related payments, where applicable.

Net Pension Liability (Asset) - The net pension liability (asset) represents the School District's proportionate share of the net pension liability (asset) of the New York State and Local Employees' Retirement System and the New York State Teachers' Retirement System. The financial reporting of these amounts are presented in accordance with the provisions of GASB Statement No. 68, "Accounting and Financial Reporting for Pensions" and GASB Statement No. 71, "Pension Transition for Contributions Made Subsequent to the Measurement Date".

Net Position - Net position represent the difference between assets and liabilities. Net position is reported as restricted when there are limitations imposed on its use either through the enabling legislation adopted by the School District or through external restrictions imposed by creditors, grantors or laws or regulations of other governments. Net position on the Statement of Net Position include, net investment in capital assets, restricted for debt service, capital costs, tax certiorari, retirement contributions, school lunch, special purposes and capital projects. The balance is classified as unrestricted.

30




Fund Balance - Generally, fund balance represents the difference between current assets and deferred outflows of resources and current liabilities and deferred inflows of resources. In the fund financial statements, governmental funds report fund classifications that comprise a hierarchy based primarily on the extent to which the School District is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. Under this standard, the fund balance classifications are as follows:

Nonspendable fund balance includes amounts that cannot be spent because they are either not in spendable form (inventories, prepaid amounts, long-term receivables) or they are legally or contractually required to be maintained intact (the corpus of a permanent fund).

Restricted fund balance is reported when constraints placed on the use of the resources are imposed by grantors, contributors, laws or regulations of other governments or imposed by law through enabling legislation. Enabling legislation includes a legally enforceable requirement that these resources be used only for the specific purposes as provided in the legislation. This fund balance classification is used to report funds that are restricted for debt service obligations and for other items contained in General Municipal Law or Education Law of the State of New York.

Committed fund balance is reported for amounts that can only be used for specific purposes pursuant to formal action of the entity's highest level of decision making authority. The Board of Education is the highest level of decision making authority for the School District that can, by the adoption of a resolution prior to the end of the fiscal year, commit fund balance. Once adopted, these funds may only be used for the purpose specified unless the entity removes or changes the purpose by taking the same action that was used to establish the commitment. This classification includes certain amounts established and approved by the Board of Education.

Assigned fund balance, in the General Fund, represents amounts constrained either by policies of the Board of Education for amounts assigned for balancing the subsequent year's budget or the School Superintendent for amounts assigned as encumbrances. Unlike commitments, assignments generally only exist temporarily, in that additional action does not normally have to be taken for the removal of an assignment. An assignment cannot result in a deficit in the unassigned fund balance in the General Fund. Assigned fund balance in all funds except the General Fund includes all remaining amounts, except for negative balances, that are not classified as nonspendable and are neither restricted nor committed.

Unassigned fund balance, in the General Fund, represents amounts not classified as nonspendable, restricted, committed or assigned. The General Fund is the only fund that would report a positive amount in unassigned fund balance. For all governmental funds other than the General Fund, unassigned fund balance would necessarily be negative, since the fund's liabilities and deferred inflows of resources, together with amounts already classified as nonspendable, restricted and committed would exceed the fund's assets and deferred outflows of resources.

In order to calculate the amounts to report as restricted and unrestricted fund balance in the governmental fund financial statements, a flow assumption must be made about the

31




order in which the resources are considered to be applied. When both restricted and unrestricted amounts of fund balance are available for use for expenditures incurred, it is the School District's policy to use restricted amounts first and then unrestricted amounts as they are needed. For unrestricted amounts of fund balance, it is the School District's policy to use fund balance in the following order: committed, assigned, and unassigned.

F. Encumbrances

In governmental funds, encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded in order to reserve applicable appropriations, is generally employed as an extension of formal budgetary integration in the General, Special Aid and School Lunch funds. Encumbrances outstanding at year-end are generally reported as assigned fund balance since they do not constitute expenditures or liabilities.

G. Use of Estimates

The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, deferred outflows of resources, liabilities and deferred inflows of resources and disclosures of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenditures/expenses during the reporting period. Actual results could differ from those estimates.

H. Subsequent Events Evaluation by Management

Management has evaluated subsequent events for disclosure and/or recognition in the financial statements through the date that the financial statements were available to be issued, which date is September 18, 2015.

Note 2 - Stewardship, Compliance and Accountability

A. Budgetary Data

The School District generally follows the procedures enumerated below in establishing the budgetary data reflected in the financial statements:

a) At least seven days prior to the budget hearing, a copy of the budget is made available to the voters.

b) At the budget hearing, the voters may raise questions concerning the items contained in the budget.

c) The Board of Education establishes a date for the annual meeting, which by law will be held on the third Tuesday in May.

d) The voters are permitted to vote upon the General Fund budget at the annual meeting.

32



Note 2 - Stewardship, Compliance and Accountability (Continued)

e) If the original proposed budget is not approved by the voters, the Board of Education has the option of either resubmitting the original or revising the budget for voter approval at a special meeting held at a later date; or the Board of Education may, at that point, adopt a contingency budget. If the Board of Education decides to submit either the original or a revised budget to the voters for a second time, and the voters do not approve the second budget submittal, the Board of Education must adopt a contingency budget and the tax levy cannot exceed the total tax levy of the prior year (0% levy growth). In addition, the administrative component of the contingency budget shall not comprise a greater percentage of the contingency budget exclusive of the capital component than the lesser of either 1) the percentage the administrative component had comprised in the prior year budget exclusive of the capital component; or 2) the percentage the administrative component had comprised in the last proposed defeated budget exclusive of the capital component.

f) Formal budgetary integration is employed during the year as a management control device for the General, Special Aid and School Lunch funds.

g) Budgets for the General, Special Aid and School Lunch funds are legally adopted annually on a basis consistent with generally accepted accounting principles. The Capital Projects Fund is budgeted on a project basis. The Board of Education does not adopt an annual budget for the Debt Service or Special Purpose funds.

h) The Board of Education has established legal control of the budget at the function level of expenditures. Transfers between appropriation accounts, at the function level, require approval by the Board of Education. Any modification to appropriations resulting from increases in revenue estimates or supplemental reserve appropriations also require a majority vote by the Board.

i) Appropriations in the General, Special Aid and School Lunch funds lapse at the end of the fiscal year, except that outstanding encumbrances are reappropriated in the succeeding year pursuant to the Uniform System of Accounts promulgated by the Office of the State Comptroller.

Budgeted amounts are as originally adopted, or as amended by the Board of Education.

B. Limitation on Unreserved Fund Balance

The School District is limited to the amount of committed, assigned and unassigned fund balance that can be retained with certain exceptions. New York State law limits this amount to 4% of the ensuing year's budget.

C. Property Tax Limitation

On June 24, 2011, the Governor signed Chapter 97 of the Laws of 2011 ("Tax Levy Limitation Law"). This law applies to all local governments, including school districts.

The Tax Levy Limitation Law restricts the amount of real property taxes that may be levied by a school district in a particular year. The original legislation that established the Tax levy Limitation

33



Note 2 - Stewardship, Compliance and Accountability (Continued)

Law was set to expire on June 16, 2016. Chapter 20 of the Laws of 2015 extends the Tax Levy Limitation Law through June 2020.

Pursuant to the Tax Levy Limitation Law, the tax levy of a school district cannot increase by more than the lesser of two percent or the annual increase in the consumer price index. Certain adjustments would be permitted as defined by Section 1220 of the Real Property Tax Law. A school district could exceed the tax levy limitation only if the budget is approved by at least 60% of the vote. There are certain exemptions to the tax levy limitation, such as expenditures made on account of certain tort settlements and certain increases in the actuarial contribution rates of the various public employee retirement systems.

D. Cumulative Effect of Change in Accounting Principle

For the year ended June 30, 2015, the School District implemented GASB Statement No. 68, "Accounting and Financial Reporting for Pensions" and GASB Statement No. 71, "Pension Transition for Contributions Made Subsequent to the Measurement Date". These statements seek to improve accounting and financial reporting by state and local governments for pensions by establishing standards for measuring and recognizing liabilities, deferred outflows/inflows of resources and expenses/expenditures. These statements also require the identification of the methods and assumptions that should be used to project benefit payments, discount projected benefit payments to their actuarial present value and attribute that present value to periods of employee service. As a result of adopting these standards, the district-wide financial statements reflect a cumulative effect for the change in accounting principle of $6,430,747.

E. Expenditures in Excess of Budget

The following functional expenditure exceeded its budgetary authority by the amount indicated.

General Fund-Instruction- Teaching Special Schools 4,097

Note 3 - Detailed Notes on All Funds

A. Due From/To Other Funds

The composition of interfund balances at June 30, 2015 is as follows:

Fund

General Special Aid Capital Projects Non-Major Governmental

Due From

$ 1,372,971

313,766 736,689

$ 2,423,426

Due To

$ 313,766 1,256,857

736,689 116,114

$ 2,423,426

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.

34



Note 3 - Detailed Notes on All Funds (Continued)

B. Capital Assets

Changes in the School District's capital assets are as follows:

Balance Class Jul~1 . 2013 Additions

Capital Assets, not being depreciated Land $ 304,442 $

Capital Assets, being depreciated Buildings and Improvements $ 105,438,812 $ 7,000 Machinery and Equipment 1,904,067 199,037

Total Capital Assets, being depreciated 1 07,342,879 206,037

Less Accumulated Depreciation for Buildings and Improvements 27,531,267 2,047,712 Machinery and Equipment 1,210,415 199,868

Total Accumulated Depreciation 28,741,682 2,247,580

Total Capital Assets, being depreciated, net $ 78,601,197 $ {2,041,543~

Capital Assets, net $ 78,905,639 $ (2,041,543~

Balance Deletions June 30, 2014

$ $ 304,442

$ $ 105,445,812 151,282 1,951,822

151,282 107,397,634

29,578,979 151 ,282 1,259,001

151,282 30,837,980

$ $ 76,559,654

$ $ 76,864,096

Depreciation expense was charged to School District functions and programs as follows:

General Support $ 115,089 Instruction 2,113,102 Cost of Food Sales 19,389

Total Depreciation Expense $ 2.247.580

c. Long-Term Liabilities

The following table summarizes changes in the School District's long-term liabilities for the year ended June 30, 2015:

Cumulative Effect of

Balance Change in Balance Maturities Balance Due as Reported Accounting as Restated New Issues/ and/or June 30, Within Jul~ 1, 2014 PrinciQie Jul~ 1, 2014 Additions Pa~ments 2015 One-Year

Bonds Payable $ 46,350,000 $ $ 46,350,000 $ 17,150,000 $ 21 '135,000 $ 42,365,000 $ 3,270,000 Plus Unamortized premium on bonds 653,262 653,262 1,466,281 179,529 1,940,01 4

47,003,262 47,003,262 18,616,281 21,314,529 44,305,014 3,270,000

35


Notes to Financial Statements (Continued) June30 2015


Cumulative Effect of

Balance Change in Balance as Reported Accounting as Restated Jul~ 1,2014 Princi~le Jul~ 1, 2014

Installment Purchase Debt Payable $ 421,289 $ $ 421,289

Other Non-current Liabilities: Compensated Absences 354,975 354,975 Net Pension Liability 1,190,745 1 '190,745 Other Post Employment

Benefit Obligations Payable 17 737 670 17,737,670

Total Long-Term Liabilities $ 65,517,196 $ 1 '190,745 $ 66,707,941

Maturities Balance Due New Issues/ and/or June 30, Within

Additions Pa~ments 2015 One-Year

$ 456,805 $ 427,736 $ 450,358 $ 298,107

51,387 35,000 371,362 37,000 300,559 890,186

7,877,873 3 874 717 21,740,826

$ 27,002,346 $ 25,952,541 $ 67,757,746 $ 3,605,107

Each governmental fund's liability for bonds, installments purchase debt, compensated absences and other post employment benefit obligations is liquidated by the General Fund.

Bonds Payable

Bonds payable at June 30, 2015 are comprised of the following individual issues:

Amount Original Outstanding

Year of Issue Final Interest at June 30, PurEose Issue Amount Maturit~ Rates 2014

Improvements to School Buildings 2006 $ 7,375,000 September, 2029 4.125% $ 270,000 Improvements to School Buildings 2007 18,200,000 December, 2026 4.000 850,000 Improvements to School Buildings 2008 23,519,953 November, 2027 4.25-4.375 18,125,000 Refunding Bonds 2009 12,360,000 July, 2019 5.000 6,060,000 Refunding Bonds 2015 17,150,000 September, 2029 2.000- 5.000 17,060,000

$ 42,365,000

Interest expenditures of $1,673,581 were recorded in the fund financial statements in the General Fund. Interest expense of $1,576,143 was recorded in the district-wide financial statements.

Installment Purchase Debt Payable

The School District has entered into various agreements to finance the cost of purchasing certain equipment. The terms of the agreements provide for repayment in annual installments, through 2017, including interest at rates ranging from 1.81% to 2.35%. Current year acquisitions aggregated $456,805. Interest expenditures of $9,870 were recorded in the fund financial statements in the General Fund. Interest expense of $10,697 was recorded in the District-Wide financial statements. The balance due at June 30, 2015 was $450,358.

36




Payments to Maturity

The annual requirements to amortize all outstanding bonded and installment purchase debt as of June 30, 2015, including interest payments of $10,418,504 are as follows:

Year Ending Bonds Installment Purchase Debt Total

June 30, Principal Interest Princieal Interest Princieal Interest

2016 $ 3,270,000 $ 1,664,663 $ 298,107 $ 8,936 $ 3,568,107 $ 1,673,599 2017 3,360,000 1,517,988 152,251 2,748 3,512,251 1,520,736 2018 3,525,000 1,365,682 3,525,000 1,365,682 2019 3,690,000 1,199,945 3,690,000 1,199,945 2020 3,880,000 1,019,901 3,880,000 1,019,901

2021-2025 14,770,000 3,082,349 14,770,000 3,082,349 2026-2030 9,870,000 556,292 9,870,000 556,292

$ 42,365,000 $ 10,406,820 $ 450,358 $ 11,684 $ 42,815,358 $ 10,418,504

The above general obligation bonds and installment purchase debt are direct obligations of the School District for which its full faith and credit are pledged and are payable from taxes levied on all taxable real property within the School District.

Advance Refunding

During the 2015 fiscal year, the District issued $17,150,000 in serial bonds with interest rates ranging from 2.0% to 5.0%, depending on maturity. The proceeds were used to advance refund $5,340,000 of outstanding 2006A public improvement refunding serial bonds bearing interest at 4.125% and $12,350,000 of outstanding 20068 public improvement refunding serial bonds bearing interest at rates ranging from 4.0% to 4.125% . The net proceeds of $18,383,309 (including $1,466,281 of issuance premium and after $232,972 in underwriting fees and other issuance costs) were used to purchase U.S. Government securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the bonds. As a result, the 2006A and 20068 serial bonds are considered defeased and the liability for those serial bonds has been removed from the Statement of Net Position. The reacquisition price exceeded the net carrying amount of the old debt by $693,309. This amount and the premium are being amortized over the remaining life of the refunded debt. The District advance refunded the 2006A and 20068 serial bonds to reduce its total debt service payments over 15 years by $2,097,617 and to obtain a net present value economic gain of $1,788,081. As of June 30, 2015, $17,690,000 of the bonds are considered defeased.

Compensated Absences

The School District is not required to compensate employees for accumulated sick leave upon separation from service. Vacation leave for school administrators and non-teaching full-time employees is generally taken in the year subsequent to the year in which it is earned. In addition, school administrators can accumulate and carry forward to the next fiscal year up to five vacation days. Non-teaching full-time employees may carry forward one day to the next fiscal year, if prior approval is obtained. The value of the compensated absences has been reflected in the districtwide financial statements.

37




Pension Plans

Employees' Retirement System

The School District participates in the New York State and Local Employees' Retirement System ("ERS"). This is a cost-sharing, multiple-employer defined benefit pension plan. ERS provides retirement benefits as well as death and disability benefits. The net position of the ERS is held in the New York State Common Retirement Fund ("Fund"), which was established to hold all net assets and record changes in plan net position. The Comptroller of the State of New York serves as the trustee of the Fund and is the administrative head of the ERS. The Comptroller is an elected official determined in a direct statewide election and serves a four year term. Obligations of employers and employees to contribute and benefits to employees are governed by the New York State Retirement and Social Security Law ("NYSRSSL") . Once a public employer elects to participate in the ERS, the election is irrevocable. The New York State Constitution provides that pension membership is a contractual relationship and plan benefits cannot be diminished or impaired. Benefits can be changed for future me!mbers only by enactment of a State statute. The School District also participates in the Public Employees' Group Life Insurance Plan, which provides death benefits in the form of life insurance. The ERS is included in the State's financial report as a pension trust fund. That report, including information with regard to benefits provided may be found at www.osc.state.ny.us/retire/publications/index.php or obtained by writing to the New York State and Local Retirement System, 110 State Street, Albany, NY 12244.

The ERS is noncontributory except for employees who joined after July 27, 1976, who contribute 3% of their salary for the first ten years of membership, and employees who joined on or after January 1, 2010, who generally contribute between 3% and 6% of their salary for their entire length of service. Under the authority of the NYSRSSL, the Comptroller annually certifies the actuarially determined rates expressly used in computing the employers' contributions based on salaries paid during the ERS's fiscal year ending March 31. The employer contribution rates for the plan's year ending in 2015 are as follows:

Tier/Plan Rate

1 751 26.6 % 2 751 24.3 3A15 20.4 4 A15 20.4 5 A15 16.7 6A1541J1 11.0 6A1541J2 11.1

At June 30, 2015, the School District reported a liability of $890,186 for its proportionate share of the net pension liability. The net pension liability was measured as of March 31, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The School District's proportion of the net pension liability was based on a computation of the actuarially determined indexed present value of future compensation by employer relative to the total of all participating members. At June 30, 2015, the School District's proportion was .0263506%. For this first year of implementation, the ERS reported no change in the allocation percentage measured as of March 31, 2014.

38


Notes to Financial Statements (Continued) June 30 201 5


For the year ended June 30, 2015, the School District recognized pension expense/expenditures of $832,840 and $1 ,422,271, respectively. The pension expenditure of $1,422,271 was charged to the General Fund. At June 30, 2015, the School District reported deferred outflows of resources and deferred inflows of resources related to ERS from the following sources:

Differences between expected and actual experience Changes of assumptions Net difference between projected and actual

earnings on pension plan investments Changes in proportion and differences between

School District contributions and proportionate share of contributions

School District contributions subsequent to the measurement date

Deferred Outflows

of Resources

$ 28,496

154,614

136,208

411,916

$ 731,234

Deferred Inflows

of Resources

$

$

$411,916 reported as deferred outflows of resources related to ERS resulting from the School District's accrued contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended March 31, 2016. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to ERS will be recognized in pension expense as follows:

Year Ended March 31,

2016 2017 2018 2019

$ 79,830 79,830 79,830 79,828

The total pension liability for the March 31, 2015 measurement date was determined by using an actuarial valuation as of April 1, 2014, with update procedures used to roll forward the total pension liability to March 31, 2015. The total pension liability for the March 31, 2014 measurement date was determined by using an actuarial valuation as of April 1, 2014. Significant actuarial assumptions used in the April 1, 2014 valuation were as follows:

Actuarial cost method Inflation Salary scale Investment rate of return

Cost of living adjustments

Entry age normal 2.7% 4.9%, indexed by service 7.5% compounded annually, net of investment

expenses, including inflation 1.4% annually

39




Annuitant mortality rates are based on the April 1, 2005 - March 31, 2010 ERS's experience with adjustments for mortality improvements based on Society of Actuaries Scale MP-2014.

The actuarial assumptions used in the April 1, 2014 valuation are based on the results of an actuarial experience study for the period April 1, 2005 - March 31, 201 0.

The long-term expected rate of return on pension plan investments was determined in accordance with Actuarial Standard of Practice ("ASOP") No. 27, Selection of Economic Assumptions for Measuring Pension Obligations. ASOP No. 27 provides guidance on the selection of an appropriate assumed investment rate of return. Consideration was given to expected future real rates of return (expected returns, net of pension plan investment expense and inflation) for equities and fixed income as well as historical investment data and plan performance. Best estimates of arithmetic real rates of return for each major asset class included in the target asset allocation as of March 31, 2015 and 2014 are summarized below.

Asset Type

Domestic Equity International Equity Private Equity Real Estate Absolute Return Strategies Opportunistic Portfolio Real Assets Bonds and Mortgages Cash Inflation Indexed Bonds

Target Allocation

38% 13 10 8 3 3 3

18 2 2

100%

Expected Real Rate of Return

7.30% 8.55

11.00 8.25 6.75 8.60 8.65 4.00 2.25 4.00

The discount rate used to calculate the total pension liability was 7.5%. The projection of cash flows used to determine the discount rate assumes that contributions from plan members will be made at the current contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based upon those assumptions, the ERS's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.5%, as well as what the School District's proportionate share of the net pension liability (asset) would be if it were calculated using a discount rate that is 1 percentage point lower (6.5%) or 1 percentage point higher (8.5%) than the current rate:

1% Current 1% Decrease Assumption Increase {6.5%~ {7.5%} {8.5%}

School District's proportionate share of the net pension liability (asset) $ 5,933,476 $ 890,186 $ {3,367,601}

40



Note 3 -Detailed Notes on All Funds (Continued)

The components of the collective net pension liability of ERS as of the March 31, 2015 measurement date were as follows:

Total pension liability ERS fiduciary net position

Employers' net pension liability

ERS fiduciary net position as a percentage of total pension liability

$ 164,591,504,000 161,213,259,000

$ 3,378,245,000

97.9%

Employer contributions to ERS are paid annually and cover the period through the end of ERS's fiscal year, which is March 31st. Accrued retirement contributions as of June 30, 2015 represent the projected employer contribution for the period of April 1, 2015 through June 30, 2015 based on paid ERS wages multiplied by the employers' contribution rate, by tier. Accrued retirement contributions to ERS as of June 30, 2015 were $411,916.

Teachers' Retirement System

The School District participates in the New York State Teachers' Retirement System ("TRS"). This is a cost-sharing, multiple-employer defined benefit pension plan. TRS provides retirement benefits as well as death and disability benefits. The TRS is governed by a ten member Board of Trustees, which sets policy and oversees operations consistent with its fiduciary obligations under applicable law. Obligations of employers and employees to contribute and benefits to employees are governed by the Education Law of the State of New York. Once a public employer elects to participate in the TRS, the election is irrevocable. The New York State Constitution provides that pension membership is a contractual relationship and plan benefits cannot be diminished or impaired. Benefits can be changed for future members only by enactment of a State statute. The TRS issues a stand-alone financial report which may be found at www.nystrs.org or obtained by writing to the New York State Teachers' Retirement System, 10 Corporate Woods Drive, Albany, NY 12211-2395.

The TRS is noncontributory except for employees who joined after July 27, 1976, who contribute 3% of their salary for the first ten years of membership, and employees who joined on or after January 1, 2010, who generally contribute between 3% and 6% depending on salary levels for their entire length of service. Pursuant to Article 11 of the Education Law of the State of New York, actuarially determined employer contributions are established annually for the TRS by its Board of Trustees. The employer contribution rate for the plan's year ending in 2015 was 17.53%.

At June 30, 2015, the School District reported an asset of $26,046,890 for its proportionate share of the net pension asset. The net pension asset was measured as of June 30, 2014, and the total pension liability used to calculate the net pension asset was determined by an actuarial valuation as of that date. The School District's proportion of the net pension asset was based on the School District's contributions to the pension plan relative to the contributions of all participating members. At June 30, 2014, the School District's proportion was .233827%, which was a decrease of .004135% from its proportion measured as of June 30, 2013.

41


Notes to Financial Statements (Continued) June 30. 2015


For the year ended June 30, 2015, the School District recognized pension expense/expenditure of $(1,023,419) and $6,215,062, respectively. Of the current pension expenditure, $6,201,638 was charged to the General Fund and $13,424 was charged to the Special Aid Fund. At June 30, 2015, the School District reported deferred outflows of resources and deferred inflows of resources related to TRS from the following sources:

Differences between expected and actual experience Changes of assumptions Net difference between projected and actual

earnings on pension plan investments Changes in proportion and differences between

School District contributions and proportionate share of contributions

School District contributions subsequent to the measurement date

Deferred Outflows

of Resources

$

24,384

6,220,543

$ 6,244,927

Deferred Inflows

of Resources

$ 380,888

17,493,318

$ 17,874,206

$6,220,543 reported as deferred outflows of resources related to TRS resulting from the School District's accrued contributions subsequent to the measurement date will be recognized as an increase of the net pension asset in the year ended June 30, 2016. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to TRS will be recognized in pension expense as follows:

Year Ended June 30,

2015 2016 2017 2018 2019

Thereafter

$ 4,414,783 4,414,783 4,414,783 4,414,783

41,454 149,236

The total pension liability for the June 30, 2014 measurement date was determined by using an actuarial valuation as of June 30, 2013, with update procedures used to roll forward the total pension liability to June 30, 2014. The total pension liability for the June 30, 2013 measurement date was determined by using an actuarial valuation as of June 30, 2012, with update procedures used to roll forward the total pension liability to June 30, 2013. These actuarial valuations used the following actuarial assumptions:

42




Inflation Projected salary increases

Projected COLAs Investment rate of return

3.0% Rates of increase differ based on age and gender. They have been calculated based upon recent TRS member experience.

Age Female Male

25 10.35 % 10.91 % 35 6.26 6.27 45 5.39 5.04 55 4.42 4.01

1.625% compounded annually 8.0% compounded annually, net of pension plan investment expense, including inflation

Annuitant mortality rates are based on plan member experience, with adjustments for mortality improvements based on Society of Actuaries Scale AA.

The actuarial assumptions used in the June 30, 2013 and 2012 valuations were based on the results of an actuarial experience study for the period July 1, 2005 to June 30, 2010.

The long-term expected rate of return on pension plan investments was determined in accordance with Actuarial Standard of Practice ("ASOP") No. 27, Selection of Economic Assumptions for Measuring Pension Obligations. ASOP No. 27 provides guidance on the selection of an appropriate assumed investment rate of return. Consideration was given to expected future real rates of return (expected returns, net of pension plan investment expense and inflation) for each major asset class as well as historical investment data and plan performance. Best estimates of arithmetic real rates of return for each major asset class included in TRS's target asset allocation as of the valuation dates of June 30, 2013 and 2012 are summarized in the following table:

Long-Term Expected Target Allocation Real Rate of Return*

2013 2012 2013 2012 Asset Class:

Equities: Domestic equities 37 % 37 % 7.3 % 7.0 % International equities 18 18 8.5 9.1 Real estate 10 10 5.0 4.9 Alternative investments 7 7 11.0 10.2

Total Equities 72 72

Fixed Income: Domestic fixed income securities 18 18 1.5 2.0 Global fixed income securities 2 2 1.4 1.7 Mortgages 8 8 3.4 4.0 Short-term 0.8 1.2

Total Fixed Income 28 28

Total 100 % 100 %

* Real rates of return are net of the long-term inflation assumption of 2.3% for 2013 and 2012.

43




The discount rate used to measure the total pension liability was 8.0%. The projection of cash flows used to determine the discount rate assumes that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based upon those assumptions, TRS's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

The following presents the School District's proportionate share of the net pension asset calculated using the discount rate of 8.0%, as well as what the School District's proportionate share of the net pension asset would be if it were calculated using a discount rate that is one percentage point lower (7.0%) or one percentage point higher (9.0%) than the current rate:

1% Current 1% Decrease Assumption Increase {7 . 0%~ {8.0%} {9 . 0%~

School District's proportionate share of the net pension asset $ 561,868 $ 26,046,890 $ 47,763,669

The components of the collective net pension asset of TRS as of the June 30, 2014 measurement date were as follows:

Total pension liability TRS fiduciary net position

Employers' net pension asset

TRS fiduciary net position as a percentage of total pension liability

$ 97,015,706,548 108,155,083,127

$ 11,139,376,579

111.48%

Employer and employee contributions for the year ended June 30, 2015 are paid to TRS in the following fiscal year through a state aid intercept or, if state aid is insufficient, through a payment by the School District to TRS. Accrued retirement contributions as of June 30, 2015 represent employee and employer contributions for the fiscal year ended June 30, 2015 based on paid TRS wages multiplied by the employers' contribution rate plus employee contributions for the fiscal year as reported to TRS. Accrued retirement contributions to TRS as of June 30, 2015 were $6,445,156.

Other Post Employment Benefit Obligations Payable

In addition to providing pension benefits, the School District provides certain health care benefits for retired employees through a single employer defined benefit plan. The various collective bargaining agreements stipulate the employees covered and the percentage of contribution. Contributions by the School District may vary according to length of service. The cost of providing post employment health care benefits is shared between the School District and the retired employee. Substantially all of the School District's employees may become eligible for those benefits if they reach normal retirement age while working for the School District. The cost of retiree health care benefits is recognized as an expenditure as claims are paid in the fund financial statements.

44




The School District's annual other post employment benefit ("OPES") cost (expense) is calculated based on the annual required contribution, ("ARC"), an amount actuarially determined in accordance with the parameters of GASS Statement No. 45. GASS Statement No. 45 establishes standards for the measurement, recognition and display of the expenses and liabilities for retirees' medical insurance. As a result, reporting of expenses and liabilities will no longer be done under the "pay-as-you-go" approach. Instead of expensing the current year premiums paid, a per capita claims cost will be determined, which will be used to determine a "normal cost", an "actuarial accrued liability", and ultimately the ARC. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period not to exceed thirty years.

Actuarial valuations for OPES plans involve estimates of the value of reported amounts and assumptions about the probability of events far into the future. These amounts are subject to continual revision as results are compared to past expectations and new estimates are made about the future. Calculations are based on the OPES benefits provided under the terms of the substantive plan in effect at the time of each valuation and on the pattern of sharing of costs between the employer and plan members to that point. In addition, the assumptions and projections utilized do not explicitly incorporate the potential effects of legal or contractual funding limitations on the pattern of cost sharing between the employer and plan members in the future. The actuarial calculations of the OPES plan reflect a long-term perspective.

The assumed rate trend in postretirement benefits is as follows:

Initial Trend Ultimate Trend Grading Per Year

Year

July 1, 2015 2018 & Later

Rate

8.0% 4.0% 1.0%

The School District is required to accrue on the government-wide financial statements the amounts necessary to finance the plan as actuarially determined, which is equal to the expected rate of return on the School District's general assets. Funding for the Plan has been established on a pay-as-you-go basis. The amortization basis is the level dollar method with a closed amortization approach with 23 years remaining in the amortization period. The actuarial assumptions included a 5.0% investment rate of return. The School District currently has no assets set aside for the purpose of paying post employment benefits. The actuarial cost method utilized was the unit credit method.

The number of participants as of July 1, 2013 was as follows:

Active Employees Retired Employees

Total

45

509 285

794




Amortization Component: Actuarial Accrued Liability as of July 1, 2014 Assets at Market Value

Unfunded Actuarial Accrued Liability ("UAAL")

Funded Ratio

Covered Payroll (Active plan members)

UAAL as a Percentage of Covered Payroll

Annual Required Contribution Interest on Net OPEB Obligation Adjustment to Annual Required Contribution

Annual OPEB Cost

Contributions Made

Increase in Net OPEB Obligation

Net OPEB Obligation- Beginning of Year

Net OPEB Obligation - End of Year

$ 104,566,484

$ 104,566,484

0.00%

$ 41 ,653,698

251.04%

$ 5,452,275 886,884

1,538,714

7,877,873

(3,874,717}

4,003,156

17,737,670

$ 21,740,826

The School District's annual OPES cost, the percentage of annual OPES cost contributed to the plan and the net OPES obligation for the current and two preceding years is as follows:

Fiscal Percentage of Year Ended Annual Annual OPEB Net OPEB

June 30, OPEB Cost Cost Contributed Obligation

2015 $ 7,877,873 49.18 % $ 21,740,826 2014 7,531,128 51.42 17,737,670 2013 6,868,410 47.94 14,078,682

The schedule of funding progress for the OPES plan immediately following the notes to the financial statements presents multi-year trend information about whether the actuarial value of the plan assets is increasing or decreasing relative to the actuarial accrued liability for the benefits over time.

D. Revenues and Expenditures

lnterfund Transfers

lnterfund transfers are defined as the flow of assets, such as cash or goods and services, without the equivalent flow of assets in return. The interfund transfers reflected below have been reported as transfers.

46


Notes to Financial Statements {Continued) June 30 2015


General Transfers Out Fund

General Fund $ $ Other Governmental 100,000

$ 100,000 $

Transfers in Special Capital

Aid Projects Fund Fund Total

84,536 $ 317,874 $ 402,410 100,000

84,536 $ 317,874 $ 502,410

Transfers are used to move amounts earmarked in the operating funds to fulfill commitments for Special Aid and Capital Projects funds and to transfer amounts appropriated for debt service to the General Fund.

E. Net Position

The components of net position are detailed below:

Net Investment in Capital Assets - the component of net position that reports the difference between capital assets less both the accumulated depreciation and the outstanding balance of debt, excluding unexpended proceeds, that is directly attributable to the acquisition, construction or improvement of those assets.

Restricted for Debt Service - the component of net position that reports the difference between assets and liabilities of the Debt Service Fund with constraints placed on their use by Local Finance Law.

Restricted for Tax Certiorari - the component of net position that has been established in accordance with Education Law to provide funding for court ordered tax refunds which are currently in process.

Restricted for Retirement Contributions - the component of net position restricted by General Municipal Law for the purpose of financing retirement contributions to the New York State and Local Employees' Retirement System.

Restricted for Capital Costs- the component of net position that is restricted by General Municipal Law and voter approval to finance capital acquisitions for which bonds may be issued.

Restricted for School Lunch - the component of net position that reports the difference between assets and liabilities of the School Lunch Fund.

Restricted for Special Purposes - the component of net position that reports the difference between assets and liabilities with constraints placed on their use by either external parties and/or statute.

Restricted for Capital Projects - the component of net position that reports the amounts restricted for capital projects, exclusive of unexpended bond proceeds and unrestricted interest earnings.

Unrestricted - all other amounts that do not meet the definition of "restricted" or "net investment in capital assets".

47




F. Fund Balances

2015 2014 Capital Non-Major Capital Non-Major

General Projects Governmental General Projects Governmental Fund Fund Funds Total Fund Fund Funds Total

Nonspendable Inventories $ $ $ 26,502 $ 26,502 $ - $ - $ 23,546 $ 23,546 Prepaid expenditures 6.800 - - 6,800 289,666 - - 289,666

6,800 - 26,502 33,302 289,666 - 23,546 313,212 Restricted Tax certiorari 2,404,094 - 2,404,094 1,774,561 - - 1,774,561 Employee benefit accrued liability 88,786 88,786 38,786 - - 38,786 Retirement contributions 405,000 - - 405,000 405,000 - - 405,000 Debt service - 536,689 536,689 - 629,241 629,241 Capital costs 1,258,707 - - 1,258,707 865,707 - 865,707

+:>. Capital projects 306,849 306,849 - 364,631 364,631 CX> -Special purposes - 41,342 41,342 - - __ 43,446 43,446

4,156,587 306,849 578,031 5,041 ,467 3,084,054 364,631 672,687 4,121,372 Assigned

Purchases on order General government support 30,771 - - 30,771 9,182 - 9,182 Instruction 21,445 - - 21,445 46,351 - 46,351 Employee benefits 11,476 - - 11,476 10,915 - - 10,915

63,692 - 63,692 66,448 - - 66,448 Designated for subsequent year's expenditures 760,000 100,000 860,000 1,400,000 100,000 1,500,000

School Lunch Fund - - 396,687 396,687 318,536 318,536

823,692 - 496,687 1,320,379 1,466,448 - 418,536 1,884,984

Unassigned 3,464,761 - - 3,464,761 3,265,851 - 3,265,851 -Total Fund Balance $ 8,451,840 $ 306,849 $ 1,101,220 $ 9,859,909 $ 8,106,019 $ 364,631 $ 1 '114,769 $ 9,585,419



Note 3 -Detailed Notes on All Funds (Continued)

Certain elements of fund balance are described above. Those additional elements which are not reflected in the statement of net position but are reported in the governmental funds balance sheet are described below.

Inventories in the School Lunch Fund have been classified as nonspendable to indicate that a portion of fund balance is not "available" for expenditure because the asset is in the form of commodities and the School District anticipates utilizing them in the normal course of operations.

Prepaid Expenditures has been provided to account for certain payments made in advance. The amount is classified as nonspendable to indicate that funds are not "available" for appropriation or expenditure even though they are a component of current assets.

Employee Benefit Accrued Liability - the component of fund balance that has been restricted pursuant to General Municipal Law to provide funds for the payment of unused sick time and other forms of payment for accrued leave time granted upon termination or separation from service.

Purchases on order are assigned and represent the School District's intention to honor the contracts in process at year-end. The subsequent year's appropriation will be amended to provide authority to complete the transactions.

Subsequent year's expenditures represent that at June 30, 2014, the Board of Education has assigned the above amounts to be appropriated for the ensuing year's budget.

Unassigned fund balance in the General Fund represents amounts not classified as nonspendable, restricted or assigned.

Note 4 - Summary Disclosure of Significant Contingencies

A. Litigation

There are currently pending certiorari proceedings, the results of which could require the payment of future tax refunds by the School District if existing assessment rolls are modified based on the outcome of the litigation proceedings. However, the amount of these possible refunds cannot be determined at the present time. Any payments resulting from adverse decisions will be funded in the year the payment is made.

B. Contingencies

The School District participates in various Federal grant programs. These programs are subject to program compliance audits pursuant to the Single Audit Act. The amount of expenditures which may be disallowed by the granting agencies cannot be determined at this time, although the School District anticipates such amounts, if any, to be immaterial.

The School District is subject to audits of State aid by the New York State Education Department. The amount of aid previously paid to the School District which may be disallowed cannot be determined at this time, although the School District anticipates such amounts, if any, to be immaterial.

49


Notes to Financial Statements (Concluded) June 30 2015

Note 4- Summary Disclosure of Significant Contingencies (Continued)

C. Risk Management

The School District and other school districts have formed a reciprocal insurance company to be owned by these districts. This Company operates under an agreement effective July 1, 1989. The purpose of the Company is to provide general liability, auto liability, all risk building and contents and auto physical damage coverage. In addition, as part of the reciprocal program, excess insurance, school board legal liability, equipment floaters, boilers and machinery and crime and bond coverages will be purchased from commercial carriers and be available to the subscriber districts. The Company retains a management company which is responsible for the overall supervision and management of the reciprocal. The reciprocal is managed by a Board of Governors and an Attorney-in-fact, which is comprised of employees of the subscriber districts. The subscribers have elected those who sit on the board and each subscriber has a single vote. The Company is an "assessable" insurance company, in that, the subscribers are severally liable for any financial shortfall of the Company and can be assessed their proportionate share by the State Insurance Department if the funds of the Company are less than what is required to satisfy its liabilities. The subscriber districts are required to pay premiums as well as a minimal capital contribution.

The School District purchases various insurance coverages from the Company to reduce its exposure to loss. The School District maintains general liability and umbrella liability insurance coverages with policy limits of $1 million and $20 million, respectively. The School District also maintains liability coverage for school board members up to $1 million. Settled claims resulting from these risks have not exceeded commercial insurance coverage in any of the past three fiscal years.

The School District and neighboring school districts in Northern Westchester and Putnam Counties participate in the Westchester-Putnam Schools Cooperative Self-Insurance Plan for Workers' Compensation. The Plan operates under an agreement, as amended, dated February 6, 1987. The purposes of the Plan are to provide for the efficient and economical evaluation, processing, administration, defense and payment of claims against Plan members for workers' compensation payments. The Board of Trustees of the Plan consists of five Trustees selected by the Plan members. Each Trustee shall have one vote and no action may be taken except by a majority of the total membership of Trustees. Billings to each participant are based upon the cost incurred for workers' compensation . The School District has transferred all related risk to the Plan.

The School District and neighboring school districts in Northern Westchester and Putnam Counties participate in the Northern Westchester - Putnam Schools Cooperative Medical Expense Benefit Plan. The Plan operates under an agreement dated February 17, 1987. The purposes of the Plan are to provide for the efficient and economical evaluation, processing, administration and payment of claims against Plan members for medical expenses through self-insurance and to provide for centralized administration, funding and disbursements for such services. The governance of the Plan rests in the Board of Trustees which shall consist of five Trustees selected by the Plan members. A majority of the total number of Trustees shall be required to taken any actions. The billings are based upon coverages provided to each participants' employees. The School District has transferred all related risk to the Plan.

*****

50


Required Supplementary Information- Schedule of Funding Progress Other Post Employment Benefits Last Three Fiscal Years

Actuarial Unfunded Actuarial

Valuation Value of Accrued Accrued Date Assets Liability Liability

July 1, 2012 $ $ 90,635,728 $ 90,635,728 July 1, 2013 100,247,175 100,247,175 July 1, 2014 104,566,484 104,566,484

51

Unfunded Liability as a Percentage

Funded Covered of Covered Ratio Payroll Payroll

- % $ 40,596,827 223.26 % 40,516,520 247.42 41,653,698 251 .04


Required Supplementary Information - Schedule of the School District's Proportionate Share of the Net Pension Liability

New York State Teachers' Retirement System Last Ten Fiscal Years (1)

School District's proportion of the net pension liability (asset)

School District's proportionate share of the net pension liability (asset)

School District's covered-employee payroll School District's proportionate share of the

net pension liability (asset) as a percentage of its covered-employee payroll

Plan fiduciary net position as a percentage of the total pension liability

Note - The amounts presented for each fiscal year were determined as of the March 31 measurement date within the current fiscal year.

$

$

(1) Data not available prior to fiscal year 2015 implementation of Governmental Accounting Standards Board Statement No. 68, Accounting and Financial Reporting for Pensions.

52

2015

0.233827%

(26,046,890)

35,599,856

(73.17)%

111.48%


Required Supplementary Information- Schedule of Contributions New York State Teachers' Retirement System Last Ten Fiscal Years (1)

Contractually required contribution Contributions in relation to the

contractually required contribution

Contribution deficiency (excess)

School District's covered-employee payroll

Contributions as a percentage of covered-employee payroll


53

2015

$ 6,220,543

(6,220,543)

$

$ 35,599,856

17.53%


Required Supplementary Information - Schedule of the School District's Proportionate Share of the Net Pension Liability

New York State and Local Employees' Retirement System Last Ten Fiscal Years (1)

School District's proportion of the net pension liability (asset)

School District's proportionate share of the net pension liability (asset)


School District's proportionate share of the net pension liability (asset) as a percentage of its covered-employee payroll

Plan fiduciary net position as a percentage of the total pension liability

Note- The amounts presented for each fiscal year were determined as of the March 31 measurement date within the current fiscal year.

$

$


54

2015

0.0263506%

890,186

6,958,031

12.79%

97.90%


Required Supplementary Information - Schedule of Contributions New York State and Local Employees' Retirement System Last Ten Fiscal Years (1)

Contractually required contribution Contributions in relation to the

contractually required contribution

Contribution deficiency (excess)


Contributions as a percentage of covered-employee payroll


55

2015

$ 1,459,556

(1,459,556)

$

$ 6,958,031

20.98%


General Fund Comparative Balance Sheet June 30,

2015 2014 ASSETS Cash and equivalents $ 13,827,583 $ 13,824,284

Investments 197 197

Receivables Accounts 59,332 208,042 State and Federal aid 334,420 195,522 Due from other governments 1,043,363 547,397 Due from other funds 1,372,971 1,156,104

2,810,086 2,107,065

Prepaid expenditures 6,800 289,666

Total Assets $ 16,644,666 $ 16,221,212

LIABILITIES AND FUND BALANCE Liabilities Accounts payable $ 920,079 $ 1,208,454 Unearned revenues 31,490 23,160 Due to other governments 70,419 Due to other funds 313,766 571,989 Due to retirement systems 6,857,072 6,311 ,590

Total Liabilities 8,192,826 8, 115,193

Fund balance Nonspendable 6,800 289,666 Restricted 4,156,587 3,084,054 Assigned 823,692 1,466,448 Unassigned 3,464,761 3,265,851

Total Fund Balance 8,451 ,840 8,106,019

Total Liabilities and Fund Balance $ 16,644,666 $ 16,221,212

56


General Fund Comparative Schedule of Revenues, Expenditures

and Changes in Fund Balance- Budget and Actual Years Ended June 30,

2015 Variance with Final Budget

Original Final Encumbr- Positive Budget Budget Actual ances (Negative)

REVENUES Real property taxes $ 62,432,388 $ 62,332,388 $ 62,354,769 $ $ 22,381 Other tax items 11 ,242,961 11 ,242,961 11 ,228,301 (14,660) Non-property taxes 978,500 978,500 1,009,679 31 '179 Charges for services 528,000 528,000 629,034 101,034 Use of money and property 132,500 132,500 94,128 (38,372) Sale of property and compensation for loss 19,384 19,364

lnterfund revenues 9,500 9,500 7,176 (2,324) State aid 8,460,661 8,488,311 8,630,623 142,312 Federal aid 12,500 12,500 14,029 1,529 Miscellaneous 208,508 213,208 317,718 104,510

Total Revenues 84,005,718 83,937,868 84,304,841 366.973

EXPENDITURES Current General support

Board of education 283,728 284,308 278,693 5,615 Central administration 334,011 340,040 338,860 1,180 Finance 898,265 893,583 865,171 28,412 Staff 466,394 507,487 446,741 60,746 Central services 4,641 ,331 4,581,508 4,366,836 30,771 183,901 Special items 862,980 1,268,947 1,265,442 3,505

Total General Support 7,466,709 7,675,873 7,561,743 30,771 283,359

Instruction Instruction, administration and improvement 3,357,977 3,445,662 3,412,389 3,009 30,264

Teaching - Regular school 24,669,585 24,528,771 24,353,518 6,881 168,372 Programs for children with

handicapping conditions 11,133,603 11 ,222,734 10,543,274 679,460 Occupational education 716,075 716,075 715,974 101 Teaching - Special schools 93,025 93,025 96,612 510 (4,097) Instructional media 1,660,470 1,676,759 1,621 ,699 3,589 51,471 Pupil services 3,843,563 3,880,812 3,706.359 7,456 166,997

Total Instruction 45,474,298 45,563,838 44,449,825 21,445 1,092,568

Pupil transportation 5,151,420 5,159,322 5,100,900 58,422 Community services 84,439 44,862 17,172 27,690 Employee benefits 21,557,542 21,546,630 20,970,783 11,476 566,371

Debt service Principal 3,762,736 3,872,736 3,872,736 Interest 1,942,547 1,852,547 1,683.451 169,096

Total Expenditures 85,479,691 85,917,808 83,656,610 63,692 2,197,506

Excess (Deficiency) of Revenues Over Expenditures (1,473,973) (1 ,979,940) 648,231 (63,692) 2,564,479

OTHER FINANCING SOURCES (USES) Transfers in 100,000 100,000 100,000 Transfers out (92,475) (406,324) (402,410) 3,914

Total Other Financing Uses 7,525 (306,324) (302,41 0) 3,914

Net Change in Fund Balance (1 ,466,448) (2,286,264) 345,821 $ (63,692) $ 2,568,393

FUND BALANCE Beginning of Year 1,466,448 2,286,264 8,106,019

End of Year $ $ $ 8,451,840

57



$ 61,465,634 $ 61,465,634 $ 61,246,828 $ $ (218,806) 10,994,744 10,994,744 11,215,061 220,317

935,000 935,000 1,012,402 77,402 508,480 508,480 583,979 75,499 150,225 150,225 100,336 (49,889)

1,000 1,000 1,714 714 10,000 10,000 7,936 (2,064)

7,755,780 7,803,750 7,681,202 (122,548) 24,500 24,500 40,296 15,796

338,631 343,228 290,299 (52,929)

82,183,994 82,236,561 82,180,053 (56,508)

279,446 279,588 275,090 4,498 325,239 323,957 322,557 208 1,192 879,961 879,693 858,555 21 '138 489,246 537,678 480,124 57,554

4,558,658 5,094,579 4,784,847 8,974 300,758 881,765 887,448 879,942 7,506

7,414,315 8,002,943 7,601,115 9,182 392,646

3,232,500 3,293,288 3,214,425 1,710 77,153 24,683,954 24,557,019 24,024,310 37,707 495,002

10,690,971 10,513,779 9,873,333 640,446 594,970 597,970 587,884 10,086 91,025 91,025 94,135 (3,110)

1,595,178 1,676,022 1,621,443 6,934 47,645 3,658,461 3,699,956 3,581,721 118,235

44,547,059 44,429,059 42,997,251 46,351 1,385,457

5,164,008 5,012,752 4,927,171 85,581 57,625 44,747 30,903 13,844

20,880,892 20,645,858 20,066,583 10,915 568,360

3,587,197 3,586,597 3,586,240 357 2,079,845 2,067,110 2,067,110

83,730,941 83,789,066 81,276,373 66,448 2,446,245

(1 ,546,947) (1 ,552,505) 903,680 (66,448) 2,389,737

100,000 100,000 100,000 (11 0,000) (484,578~ (459,660~ 24,918

(10,000) (384,578) (359,660) 24,918

(1 ,556,947) (1 ,937,083) 544,020 $ (66,448) $ 2,414,655

1,556,947 1,937,083 7,561,999

$ $ $ 8,106,019

58


General Fund Schedule of Revenues and Other Financing Sources Compared to Budget Year Ended June 30, 2015


Original Final Positive Budget Budget Actual (Negative) -

REAL PROPERTY TAXES $ 62,432,388 $ 62,332,388 $ 62,354,769 $ 22,381

OTHER TAX ITEMS School tax relief reimbursement 11,242,961 11,242,961 11,228,301 (14,660)

NON-PROPERTY TAXES Non-property tax distribution from County 978,500 978,500 1,009,679 31 1179

01 CHARGES FOR SERVICES (.0

Day school tuition - Other districts 1,056 1,056 - -Drivers education 88,000 88,000 94,580 6,580 Health services - Other districts 440,000 440,000 533,398 93,398

528,000 528,000 629,034 101 ,034

USE OF MONEY AND PROPERTY Earnings on investments 62,500 62,500 21,450 (41 ,050) Rental of real property 70,000 70,000 72,678 2,678

132,500 132,500 94,128 (38,372)

SALE OF PROPERTY AND COMPENSATION FOR LOSS

Insurance recoveries - - 18,366 18,366 Other - - 1,018 1,018

19,384 19,384

INTERFUND REVENUES 9,500 9,500 7,176 (2,324)

STATE AID Basic formula 7,314,757 7,342,207 7,009,070 (333, 137) Textbook aid 204,341 204,341 203,468 (873) Computer software aid 79,605 79,605 79,591 (14) Lottery aid - - 349,827 349,827 Library materials aid 24,475 24,475 24,475 BOCES aid 837,683 837,683 964,192 126,509

8,460,861 8,488,311 8,630,623 142,312 FEDERAL AID Medical assistance 12,500 12,500 14,029 1,529

MISCELLANEOUS Refund from BOCES - OPES - - 113,893 113,893 Refunds of BOCES aided services 107,000 107,000 82,719 (24,281) Gifts and donations - 4,700 4,700 Other 101 ,508 101,508 116,406 14,898

0') 208,508 213,208 317,718 104,510

0 TOTAL REVENUES 84,005,718 83,937,868 84,304,841 366,973

OTHER FINANCING SOURCES Transfers in

Debt Service Fund 100,000 100,000 100,000

TOTAL REVENUES AND OTHER FINANCING SOURCES $ 84,105,718 $ 84,037,868 $ 84,404,841 $ 366,973

0> ~


General Fund Schedule of Expenditures and Other Financing Uses Compared to Budget Year Ended June 30, 2015

Original Budget

GENERAL SUPPORT

BOARD OF EDUCATION Board of education $ 254,205 $ District clerk 21,714 District meeting 7,809

Total Board of Education 283,728

CENTRAL ADMINISTRATION Chief school administrator 334,011

FINANCE Business administration 834,065 Auditing 64,200

Total Finance 898,265

STAFF Legal 105,000 Personnel 355,644 Public information and services 5,750

Total Staff 466,394


Final Encumbr- Positive Budget Actual ances (Negative)

254,785 $ 251,183 $ - $ 3,602 21,714 21,528 - 186

7,809 5,982 - 1,827

284,308 278,693 - 5,615

340,040 338,860 - 1,180

829,383 803,771 - 25,612 64,200 61 ,400 - 2,800

893,583 865,171 - 28,412

105,000 52,862 - 52,138 396,737 389,825 - 6,912

5,750 4,054 - 1,696

507,487 446,741 - 60,746

CENTRAL SERVICES Operation of plant 3,800,310 3,737,358 3,575,267 30,771 131,320 Maintenance of plant 765,969 769,098 725,471 - 43,627 Central printing and mailing 75,052 75,052 66,098 - 8,954

Total Central Services 4,641,331 4 ,581 ,508 4,366,836 30,771 183,901

SPECIAL ITEMS Unallocated insurance 296,953 297,335 297,335 School association dues 14,928 14,809 14,708 - 101 Judgments and claims 10,500 416,204 412,800 - 3,404 Administrative charge-BOCES 540,599 540,599 540,599

Total Special Items 862,980 1,268,947 1,265,442 - 3,505

Total General Support 7,486,709 7,875,873 7,561 ,743 30,771 283,359

INSTRUCTION

0> INSTRUCTION, ADMINISTRATION AND N

IMPROVEMENT Curriculum development and supervision 424,987 442,637 427,405 - 15,232 Supervision - Regular school 2,863,582 2,940,700 2,929,563 3,009 8,128 In-service training - Instruction 69,408 62,325 55,421 - 6,904

Total Instruction, Administration and Improvement 3,357,977 3.445,662 3,412,389 3,009 30,264

TEACHING- REGULAR SCHOOL 24,669,585 24,528,771 24,353,518 6,881 168,372

PROGRAMS FOR CHILDREN WITH HANDICAPPING CONDITIONS

Programs for students with disabilities 11,133,603 11 ,222,734 10,543,274 - 679,460

OCCUPATIONAL EDUCATION 716,075 716,075 715,974 - 101

(Continued)


General Fund Schedule of Expenditures and Other Financing Uses Compared to Budget (Continued) YearEndedJune30.2015



INSTRUCTION (Continued)

TEACHING - SPECIAL SCHOOLS $ 93,025 $ 93,025 $ 96,612 $ 510 $ {4,097)

INSTRUCTIONAL MEDIA School library and audiovisual 649,278 654,752 634,357 3,589 16,806 Educational television 23,100 23,100 22,707 - 393 Computer assisted instruction 988,092 998,907 964,635 - 34,272

Total Instructional Media 1,660,470 1,676,759 1,621 ,699 3,589 51,471 0'> w PUPIL SERVICES

Guidance - Regular school 1,517,197 1,529,040 1,433,051 1,344 94,645 Health services - Regular school 633,634 633,630 570,394 - 63,236 Psychological services - Regular school 661 '137 697,254 696,867 - 387 Social work services 183,936 169,272 168,622 - 650 Co-curricular activities - Regular school 191,302 187,372 183,903 - 3,469 Interscholastic activities - Regular school 656,357 664,244 653,522 6,112 4,610

Total Pupil Services 3,843,563 3,880,812 3,706,359 7,456 166,997

Total Instruction 45,474,298 45,563,838 44,449,825 21,445 1,092,568

PUPIL TRANSPORTATION District transportation services 472,007 479,015 478,601 - 414 Contract transportation 4,679,413 4,680,307 4,622,299 - 58,008

Total Pupil Transportation 5,151,420 5,159,322 5,100,900 - 58,422

COMMUNITY SERVICES Civic activities 84,439 44,862 17,172 - 27,690

EMPLOYEE BENEFITS State retirement 1,501,580 1,501,716 1,422,271 - 79,445 Teachers' retirement 6,310,267 6,310,267 6,201,638 - 108,629 Social security 3,340,591 3,340,643 3,203,777 - 136,866 Workers' compensation benefits 175,903 173,803 159,444 - 14,359 Hospital and medical insurance 9,410,909 9,410,909 9,237,606 - 173,303 Union welfare benefits 818,292 811,292 746,047 11,476 53,769

Total Employee Benefits 21,557,542 21,548,630 20,970,783 11,476 566,371

DEBT SERVICE Principal

Serial bonds 3,355,000 3,445,000 3,445,000 Installment purchase debt 427,736 427,736 427,736

3,782,736 3,872,736 3,872,736

Interest Serial bonds 1,918,926 1,828,926 1,673,581 - 155,345

0'> ~ Installment purchase debt 9,871 9,871 9,870 - 1

Tax anticipation note 13,750 13,750 - - 13,750

1,942,547 1,852,547 1,683,451 - 169,096

Total Debt Service 5,725,283 5,725,283 5,556,187 - 169,096

TOTAL EXPENDITURES 85,479,691 85,917,808 83,656,610 63,692 2,197,506

OTHER FINANCING USES Transfers out

Special Aid Fund 92,475 88,450 84,536 - 3,914 Capital Projects Fund - 317,874 317,874

TOTAL OTHER FINANCING USES 92,475 406,324 402,410 - 3,914

TOTAL EXPENDITURES AND OTHER FINANCING USES $ 85,572,166 $ 86,324,132 $ 84,059,020 $ 63,692 $ 2,201,420



Special Aid Fund Comparative Balance Sheet June 30,

2015 2014 ASSETS Cash and equivalents $ 982,091 $ 953,831 Investments 425 425 State and Federal aid receivable 410,003 349,767

Total Assets $ 1,392,519 $ 1,304,023

LIABILITIES Accounts payable $ 103,570 $ 109,224 Unearned revenues 32,092 53,975 Due to other funds 1,256,857 1,140,824

Total Liabilities $ 1,392,519 $ 1,304,023

65


Special Aid Fund Comparative Schedule of Revenues, Expenditures

and Changes in Fund Balance - Budget and Actual Years Ended June 30 ,


Original Final Positive Budget Bud9et Actual ~Ne9ative~

REVENUES State aid $ 515,025 $ 519,050 $ 438,778 $ (80,272) Federal aid 1,160,052 1,184,168 1,184,168

Total Revenues 1,675,077 1,703,218 1,622,946 (80,272)


General support 157,500 157,500 100,633 56,867 Instruction 1,446,945 1,466,353 1,439,034 27,319 Pupil transportation 163,107 167,815 167,815

Total Expenditures 1,767,552 1,791 ,668 1,707,482 84,186

Deficiency of Revenues Over Expenditures (92,475) (88,450) (84,536) 3,914

OTHER FINANCING SOURCES Transfers in 92,475 88,450 84,536 (3,914)

Net Change in Fund Balance

FUND BALANCE Beginning of Year

End of Year $ $ $ $

66

$

$

Original Budget

447,500 1,088,012

1,535,512

157,500 1,374,041

113,971

1,645,512

(110,000)

110,000

$

$

Final Budget

472,910 1,229,898

1,702,808

157,500 1,521,853

133,455

1,812,808

2014

$

(11 0,000)

110,000

$

Actual

434,532 1,216,613

1,651 ,145

94,205 1,508,567

133,455

1,736,227

(85,082)

85,082


$

$

67

Positive (Negative)

(38,378) (13,285)

(51,663)

63,295 13,286

76,581

24,918

(24,918)


Capital Projects Fund Comparative Balance Sheet June 30,

2015 2014 ASSETS Cash and equivalents $ 746,372 $ 534,458

Receivables State and Federal aid 5,331 Due from other funds 313,766 571 ,989

313,766 577,320

Total Assets $ 1,060,138 $ 1,111,778

LIABILITIES AND FUND BALANCE Liabilities Accounts payable $ 16,600 $ 16,600 Unearned revenues 1,306 Due to other funds 736,689 729,241

Total Liabilities 753,289 747,147

Fund balance Restricted 306,849 364,631

Total Liabilities and Fund Balance $ 1,060,138 $ 1,111,778

68


Capital Projects Fund Comparative Statement of Revenues, Expenditures

and Changes in Fund Balance Years Ended June 30,

2015 2014 REVENUES State aid $ $ 23,895

EXPENDITURES Capital outlay 832,461 882,723

Deficiency of Revenues Over Expenditures (832,461) (858,828)

OTHER FINANCING SOURCES (USES) Installment purchase debt issued 456,805 445,743 Transfers in 317,874 374,578

Total Other Financing Sources 774,679 820,321

Net Change in Fund Balance (57,782) (38,507)

FUND BALANCE Beginning of Year 364,631 403,138

End of Year $ 306,849 $ 364,631

69


Capital Projects Fund Project-Length Schedule Inception of Project Through June 30, 2015

Project Appropriation

Five Year Facilities Plan $ 2,000,000 BOCES Capital Construction 1,029,618 Equipment Purchases 2014/2015 456,805

Totals $ 3,486,423

70

$

$

Expenditures and Transfers to Date

Prior Current Years Year Total

1,349,293 $ 7,000 $ 1,356,293 358,138 364,631 722,769

456,805 456,805

1,707,431 $ 828,436 $ 2,535,867

Methods of Financing

Fund Unexpended Proceeds of Balance at

Balance Obligations Transfers Totals June 30, 2015

$ 643,707 $ $ 1,356,293 $ 1,356,293 $ 306,849 1,029,618 1,029,618 306,849

456,805 456,805

$ 950,556 $ 456,805 $ 2,385,911 $ 2,842,716 $ 306,849

71


Combining Balance Sheet Non-Major Governmental Funds June 30, 2015 (With Comparative Totals for 2014)


Investments

Receivables State and Federal aid Due from other funds

Inventories

Total Assets

LIABILITIES AND FUND BALANCES Liabilities

Accounts payable Unearned revenues Due to other governments Due to other funds

Total Liabilities

Fund balances Nonspendable Restricted Assigned

Total Fund Balances

Total Liabilities and Fund Balances

$

$

$

$

72

School Lunch

Special Purpose

Debt Service

453,106 $ 41,342 .....:..$ ___ _

1,897

13,314 736,689

13,451 736,689

26,502

494,956 $ 41,342 $ 736,689

6,571 $ $ 47,874

1,208 16,114 100,000

71,767 100,000

26,502 41,342 536,689

396,687 100,000

423,189 41,342 636,689

494,956 $ 41,342 $ 736,689

Total Non-Major Governmental Funds

2015 2014

$ 494,448 $ 416,634

1,897

13,314 736,689

750,140

26,502

1,897

14,913 729,241

744,154

23,546

$ 1,272,987 $ 1,186,231

$ 6,571 $ 22,925 47,874 31,948

1,208 1,309 116,114 15,280

171,767 71,462

26,502 23,546 578,031 672,687 496,687 418,536

1,101,220 1,114,769

$ 1,272,987 $ 1,186,231

73


Combining Statement of Revenues, Expenditures and Changes in Fund Balances

Non-Major Governmental Funds Year Ended June 30, 2015 (With Comparative Totals for 2014)

REVENUES Use of money and property State aid Federal aid Food sales Miscellaneous

Total Revenues


Cost of food sales Other

Debt service Refunding bond issuance costs

Total Expenditures

Excess (Deficiency) of Revenues Over Expenditures

OTHER FINANCING SOURCES (USES) Refunding bonds issued Premium on bonds issued Payment to refunded bond escrow agent Transfers out

Total Other Financing Sources (Uses)

Net Change in Fund Balances

FUND BALANCES Beginning of Year

End of Year

School Lunch

$ 396 14,225

172,483 1,034,961

1,222,065

11140,958

1,140,958

81 1107

81,107

342,082

$ 423,189

74

Special Debt Purpose Service

$ 71 $ 187

3,625 7,261

3,696 7,448

5,800

232,972

5,800 232,972

(2, 1 04) (225,524)

17,150,000 1,466,281

(18,383,309) (1 00,000)

132,972

(2,1 04) (92,552)

43,446 729,241

$ 41,342 $ 636,689

$

$

Total Non-Major Governmental Funds

2015

654 14,225

172,483 1,034,961

10,886

1,233,209

1,140,958 5,800

232,972

1,379,730

(146,521)

17,1 50,000 1,466,281

(18 ,383,309) (1 00,000)

132,972

(13,549)

1,114,769

1,101,220

2014

$ 99.8

$

14,342 184,583

1,058,318 6,874

1,265,115

1,164,858 5,700

1 '170,558

94,557

(1 00,000)

(1 00,000)

(5,443)

1,120,212

1,114,769

75



School Lunch Fund Comparative Balance Sheet June 30,

2015 2014 ASSETS Cash and equivalents $ 453,106 $ 373,188

Investments 1,897 1,897

Receivables Accounts 137 State and Federal aid 13,314 14,913

13,451 14,913

Inventories 26,502 23,546

Total Assets $ 494,956 $ 413,544

LIABILITIES AND FUND BALANCE Liabilities Accounts payable $ 6,571 $ 22,925 Unearned revenues 47,874 31,948 Due to other governments 1,208 1,309 Due to other funds 16,114 15,280

Total Liabilities 71 ,767 71 ,462

Fund balance Non spendable 26,502 23,546 Assigned 396,687 318,536

Total Fund Balance 423,189 342,082

Total Liabilities and Fund Balance $ 494,956 $ 413,544

76


School Lunch Fund Comparative Schedule of Revenues, Expenditures and

Changes in Fund Balance - Budget and Actual Years Ended June 30,


Original Final Positive Budget Budget Actual (Negativel

REVENUES Use of money and property $ 480 $ 480 $ 396 $ (84) State aid 16,500 16,500 14,225 (2,275) Federal aid 178,260 178,260 172,483 (5,777) Food sales 1,023,000 1,023,000 1,034,961 11 ,961

Total Revenues 1,218,240 1,218,240 1,222,065 3,825


Cost of food sales 1,218,240 1,218,240 1,140,958 77,282

Excess of Revenues Over Expenditures 81 '107 81 '107


End of Year $ $ $ 423,189 $ 423,189

77


Original Final Positive Budget Budget Actual (Negative)

$ 800 $ 800 $ 530 $ (270) 15,600 15,600 14,342 (1,258)

184,400 184,400 184,583 183 1,063,034 1,063,034 1,058,318 (4 ,716)

1,263,834 1,263,834 1,257,773 (6,061)

1,263,834 1,263,834 1,164,858 98,976

92,915 92,915

249,167 249,167

$ $ $ 342,082 $ 342,082

78


Special Purpose Fund Comparative Balance Sheet June 30,


FUND BALANCE Restricted

79

2015 2014

$ 41 ,342 $ 43,446

$ 41,342 $ 43,446


Special Purpose Fund Comparative Statement of Revenues, Expenditures


2015 2014 REVENUES Use of money and property $ 71 $ 115 Miscellaneous 3,625 6,874

Total Revenues 3,696 6,989


Other 5,800 5,700

Excess (Deficiency) of Revenues Over Expenditures (2,104) 1,289


End of Year $ 41,342 $ 43,446

80


Debt Service Fund Comparative Balance Sheet June 30,

2015 2014 ASSETS Due from other funds $ 736,689 $ 729,241

LIABILITIES AND FUND BALANCE Liabilities

Due to other funds $ 100,000 $

Fund Balance Restricted 536,689 629,241 Assigned 100,000 100,000

Total Fund Balance 636,689 729,241

Total Liabilities and Fund Balances $ 736,689 $ 729,241

81


Debt Service Fund Comparative Statement of Revenues, Expenditures


2015 2014 REVENUES Use of money and property $ 187 $ 353 Miscellaneous 7,261

Total Revenues 7,448 353

EXPENDITURES Debt service

Refunding bond issuance costs 232,972

Excess (Deficiency) of Revenues Over Expenditures (225,524) 353

OTHER FINANCING SOURCES Refunding bonds issued 17,150,000 Premium on bonds issued 1,466,281 Payment to refunded bond escrow agent (18,383,309) Transfers out (1 00,000) (1 00,000)

Total Other Financing Sources (Uses) 132,972 (100,000)

Net Change in Fund Balance (92,552) (99,647)


End of Year $ 636,689 $ 729,241

82


General Fund Analysis of Change from Adopted Budget to Final Budget Year Ended June 30, 2015

Adopted Budget

Encumbrances

Original Budget

Budget Revisions

Final Budget

General Fund Section 1318 of Real Property Tax Law Limit Calculation Year Ended June 30, 2015

2015-16 Expenditure Budget

General Fund Fund Balance Subject to Section 1318 of Real Property Tax Law Unrestricted fund balance

Assigned fund balance Unassigned fund balance

Total Unrestricted Fund Balance

Less Appropriated for subsequent year's budget Encumbrances

Total Adjustments

General Fund Fund Balance Subject to Section 1318 of Real Property Tax Law

Actual Percentage

83

823,692 3,464,761

4,288,453

760,000 63,692

823,692

$ 85,505,718

66,448

85,572,166

751 ,966

$ 86,324,132

$ 86,619,022

$ 3,464,761

4.00%


Schedule of Net Investment in Capital Assets Year Ended June 30, 2015

Capital Assets, net

Less Bonds payable Installment purchase debt payable

Plus Unamortized portion of loss on refunding bonds

Net Investment in Capital Assets

84

(44,305,014) (450,358)

$ 76,864,096

(44,755,372)

7,726,791

$ 39,835,515


O'CONNOR DAVIES

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


The Board of Education of the Somers Central School District, New York

PKF

We have audited the financial statements of the governmental activities, each major fund and the aggregate remaining fund information of the Somers Central School District, New York ("School District") as of and for the year ended June 30, 2015, which collectively comprise the School district's basic financial statements and have issued our report thereon dated September 18, 2015. 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.

Internal Control Over Financial Reporting Management of the School District is responsible for establishing and maintaining effective internal control over financial reporting. In planning and performing our audit, we considered the School District's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control over financial reporting.

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 a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the School District's financial statements will not be prevented, or detected and corrected on a timely basis.

Our consideration of internal control over financial reporting 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 financial reporting that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above.


500 Mamaroneck Avenue, Suite 301, Harrison, NY 10528 I Tel: 914.381.8900 1 Fax: 914.381.8910 1 www.odpkf.com O'~onn~r Davies, LLP is a member fir~ ~f _the PKF lntern~tional Limited network of legally independent firms and does not accept any responsibility or liability for the actions or 1nact1ons on the part of any other 1nd1v1dual member f1rm or firms.

Compliance and Other Matters As part of obtaining reasonable assurance about whether the School District's financial statements are free of 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.

We noted certain matters that we reported to the management of the School District in a separate letter.

This report is intended solely for the information and use of the Board of Education, management and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties. However, this report is a matter of public record and its distribution is not limited.

O'Connor Davies, LLP Harrison, New York September 18, 2015

86

O'CONNOR DAVIES

Report on Compliance For Each Major Federal Program and Report on Internal Control Over Compliance Required by OMB Circular A-133


The Board of Education of the Somers Central School District, New York

Report on Compliance for Each Major Federal Program

PKF

We have audited the Somers Central School District, New York's compliance with the types of compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that could have a direct and material effect on each of the School District's major federal programs for the year ended June 30, 2015. The School District's major federal programs are identified in the summary of auditors' 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.

Auditors' Responsibility

Our responsibility is to express an opinion on compliance for each of the School 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 Non-Profit 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 School 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 School District's compliance.


500 Mamaroneck Avenue, Suite 301, Harrison, NY 10528 I Tel: 914.381.8900 I Fax: 914.381.8910 J www.odpkf.com O'~onn?r Davies, LLP is a member firm of the PKF International Limited network of legally independent firms and does not accept any responsibility or liability for the actions or mact1ons on the part of any other individual member firm or firms.

Opinion on Each Major Federal Program

In our opinion, the School 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 School 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 School 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 School 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.

O'Connor Davies, LLP Harrison, New York September 18, 2015

88


Schedule of Expenditures of Federal Awards Year Ended June 30, 2015

Federal Federal CFDA Program

Federal Grantor Program Title Number (1) Expenditures

U.S. Department of Agriculture Indirect Programs- Passed through New York State

Department of Education

Child Nutrition Cluster School Breakfast Program 10.553 $ 4,951 National School Lunch Program (NSLP) - Commodities 10.555 35,538 National School Lunch Program (NSLP) - Cash 10.555 131 ,994

Total U.S. Department of Agriculture 172.483

U.S. Department of Education Indirect Programs- Passed through New York State

Department of Education

Chapter I Programs - Local Title I Grants to Local Educational Agencies 84.010 287,512

(Title I, Part A of the ESEA)

Special Education Cluster (IDEA) Special Education - Grants to States (IDEA, Part B) 84.027 813,958 Special Education - Preschool Grants (IDEA Preschool) 84.173 21 ,331

835,289

Improving Teacher Quality State Grants 84.367 61 ,367

Total U.S. Department of Education 1,184,168

Total $ 1,356,651

(1) Catalog of Federal Domestic Assistance number.

The accompanying notes are an integral part of this schedule.

89


Notes to Schedule of Expenditures of Federal Awards Year Ended June 30 2015

Note 1 - Basis of Presentation

The accompanying schedule of expenditures of federal awards ("Schedule") includes the federal grant activity of the Somers Central School District, New York's ("School District") under programs of the federal government for the year ended June 30, 2015. Federal awards received directly from Federal agencies as well as Federal awards passed through other government agencies are included in the Schedule. The information in this Schedule is presented in accordance with the requirements of the Office of Management and Budget ("OMB") Circular A-133, Audits of States, Local Governments and Non-Profit Organizations. Because the Schedule presents only a selected portion of the operations of the School District, it is not intended to and does not present the financial position or changes in net position of the School District.

Note 2 -Summary of Significant Accounting Policies

Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in OMB Circular A-87, Cost Principles for State, Local and Indian Tribal Governments, which establishes principles and standards for determining costs for Federal awards carried out through grants, cost reimbursement contracts and other agreements with State and local governments.

90


Schedule of Findings and Questioned Costs Year Ended June 30. 2015

Section I- Summary of Auditors' Results

Financial Statements

Type of auditors' report issued Unmodified

Internal control over financial reporting: • Material weakness(es) identified? • Significant deficiency(ies) identified?

Noncompliance material to financial statements noted?

Federal Awards

Internal control over major programs: • Material weakness(es) identified? • Significant deficiency(ies) identified?

__ Yes __ Yes

__ Yes

__ Yes __ Yes

X No X None reported

X No

X No X None reported

Type of auditors' report issued on compliance for major programs: Unmodified

Any audit findings disclosed that are required to be reported in accordance with Section 510(a) of OMB Circular A-133?

Identification of major programs:

__ Yes

CFDA Number(s) Name of Federal Program or Cluster

84.027 84.173

Special Education Cluster (IDEA): Special Education - State Grants Special Education - Preschool Grants

Dollar threshold used to distinguish between Type A and Type 8 programs: $300.000

X No

Auditee qualified as low-risk auditee? X Yes __ No

91


Schedule of Findings and Questioned Costs Year Ended June 30 2015

Section II - Financial Statement Findings

None

Section Ill - Federal Award Findings and Questioned Costs

None

92


Summary Schedule of Prior Audit Findings Year Ended June 30 2015

None

93

Documents

Somers Central School District, New · PDF fileAccordance with Government Auditing ... Our discussion and analysis of the Somers Central School District, New York's financial ... Somers