ONEONTA CITY SCHOOL DISTRICT

Financial Statements
As of and For the Year Ended June 30, 2018 Together with
Independent Auditor’s Report

TABLE OF CONTENTS

Page

INDEPENDENT AUDITOR’S REPORT……………………………………………..…………… .	1 - 2

REQUIRED SUPPLEMENTARY INFORMATION

Management’s Discussion and Analysis (Unaudited)………………………………………….. ..	3 - 12

BASIC FINANCIAL STATEMENTS

Statement of Net Position - Governmental Activities ............................................................	13

Statement of Activities - Governmental Activities .................................................................	14

Balance Sheet - Governmental Funds and Reconciliation of Total Governmental Fund
Balance to Government-Wide Net Position .......................................................................	15 - 17

Statement of Revenue, Expenditures, and Changes in Fund Balance –
Governmental Funds.........................................................................................................	18

Reconciliation of the Statement of Revenue, Expenditures, and Changes in Fund Balance
to the Statement of Activities ............................................................................................	19

Statement of Net Position - Fiduciary Funds ........................................................................	20

Statement of Changes in Net Position - Fiduciary Funds .....................................................	20

Notes to Financial Statements ..............................................................................................	21 - 51

REQUIRED SUPPLEMENTARY INFORMATION (UNAUDITED)

Schedule of Revenue, Expenditures, and Changes in Fund Balance - Budget and Actual -
General Fund	.................................................................................................................	52 - 53

Schedule of Changes in Total Other Postemployment Benefit Liability and Related Ratios 54

Schedule of Proportionate Share of Net Pension Liability (Asset) .......................................	55

Schedule of Contributions - Pension Plans ..........................................................................	56

SUPPLEMENTARY INFORMATION (UNAUDITED)

Schedule of Change from Original Budget to Revised Budget and Use of Unreserved
Fund Balance - General Fund ...........................................................................................	57

Section 1318 of Real Property Tax Law Limit Calculation ...................................................	57

Schedule of Project Expenditures - Capital Projects Fund ...................................................	58

Schedule of Net Investment in Capital Assets .....................................................................	59

TABLE OF CONTENTS (Continued)

Page

REQUIRED REPORT

Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed
in Accordance with Government Auditing Standards.......................................................	60 - 61

INDEPENDENT AUDITOR’S REPORT

September 27, 2018

The Board of Education and Superintendent of the Oneonta City School District:

Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund and the aggregate remaining fund information of the Oneonta City School District (District) as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.	Accordingly, we express no such opinion.	An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

432 North Franklin Street, Suite 60 Syracuse, New York 13204 p (315) 476-4004 f (315) 475-1513

www.bonadio.com

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 aggregate remaining fund information of the Oneonta City School District as of June 30, 2018, and the respective changes in financial position, thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

(Continued)

1
ALBANY • BATAVIA • BUFFALO • EAST AURORA • GENEVA • NYC • ROCHESTER • RUTLAND, VT • SYRACUSE • UTICA

INDEPENDENT AUDITOR’S REPORT (Continued)

Emphasis of Matter – Change in Accounting Principle
As described in Notes 2 and 13 to the financial statements, the District adopted new accounting guidance, GASB Statement No. 75, Accounting and Financial reporting for Postemployment Benefits other than Pensions – an amendment of GASB 45. As a result, a net adjustment was made to decrease net position at July 1, 2017 by $15,856,776. Our opinions are not modified with respect to this matter.

Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, budgetary comparison information, schedule of changes in total other postemployment benefit liability and related ratios, proportionate share of net pension liability (asset) and contributions – pension plans 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.

Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the District’s basic financial statements. The supplementary information as required by the New York State Education Department is presented for purposes of additional analysis and is not a required part of the basic financial statements.

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

Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated September 27, 2018 on our consideration of the District’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely 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 effectiveness of the District’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control over financial reporting and compliance.

2

ONEONTA CITY SCHOOL DISTRICT

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) FOR THE FISCAL YEAR ENDED JUNE 30, 2018

The following is a discussion and analysis of the School District’s financial performance for the fiscal year ended June 30, 2018. The section is a summary of the School District’s financial activities based on currently known facts, decisions, or conditions. It is also based on both the government-wide and fund-based financial statements. The results of the current year are discussed in comparison with the prior year with an emphasis placed on the current year. This section is only an introduction and should be read in conjunction with the School District’s financial statements, which immediately follow this section.

FINANCIAL HIGHLIGHTS

	Government-wide net position of the School District was a deficit of $8,202,993. 	Government-wide net position was $2,060,706 less than at July 1, 2017.
	 The School District continued to offer all programs, without reducing services, while maintaining fund balance, which is slightly above the State mandated limits.

OVERVIEW OF THE FINANCIAL STATEMENTS

This annual report consists of three parts: Management’s Discussion and Analysis (MD&A) (this section), the basic financial statements, and required supplementary information. The basic financial statements include two kinds of statements that present different views of the School District:

• The first two statements are District-wide financial statements that provide both short-term and long-term information about the School District’s overall financial status.

• The remaining statements are fund financial statements that focus on individual parts of the School District, reporting the School District’s operations in more detail than the District-wide statements.

• The governmental funds statements tell how basic services, such as special education, were financed in the short-term.

• Fiduciary funds statements provide information about the financial relationships in which the School District acts solely as a trustee or agent for the benefit of others.

The financial statements also include notes that provide additional information about the financial statements and the balances reported. The statements are followed by a section of required supplementary information that further explains and supports the financial statements with a comparison of the School District’s budget for the year.

3

OVERVIEW OF THE FINANCIAL STATEMENTS (Continued)

Figure A-1 shows how the various sections of this annual report are arranged and related to one another.

Figure A-1	Organization of the District’s Annual Financial Report

Management’s Discussion and Analysis

Entity-wide Financial Statements

Basic Financial Statements

Fund Financial Statements

Required Supplementary Information

Notes to the Financial Statements

Summary	Detail

Figure A-2 summarizes the major features of the School District’s financial statements, including the portion of the School District’s activities that they cover and the types of information that they contain. The remainder of this overview section highlights the structure and contents of each statement.

Figure A-2	Major Features of the District-Wide and Fund Financial Statements

	Fund Financial Statements
	
	District-Wide
	Governmental Funds
	Fiduciary Funds
	
Scope
	Entire District (except fiduciary funds)
	The daily operating activities of the School District, such as instruction and special education.
	Instances in which the School District administers resources on behalf of someone else, such as scholarship programs and student activities monies.
	
Required financial statements
	• Statement of net position
• Statement of activities
	• Balance sheet
• Statement of revenue, expenditures, and changes in fund balance.
	• Statement of fiduciary net position
• Statement of changes in fiduciary net position
	
Accounting basis and measurement focus
	Accrual accounting and economic resources focus.
	Modified accrual accounting and current financial focus.
	Accrual accounting and economic resources focus.

4

OVERVIEW OF THE FINANCIAL STATEMENTS (Continued)

Figure A-2	Major Features of the District-Wide and Fund Financial Statements (Continued)

Type of asset & deferred outflow/liability & deferred inflow information
	All assets, deferred outflows, liabilities, and deferred inflows both financial and capital, short-term and long-term.
	Generally, assets expected to be used up and liabilities that come due during the year or soon after; no capital assets or
long-term liabilities included.
	All assets and liabilities, both short-term and long-term; funds do not currently contain capital assets, although they can.
	
Type of inflow/outflow information
	All revenue and expenses during the year, regardless of when cash is received or paid.
	Revenue for which cash is received during or soon after the end of the year; expenditures when goods or services have been received and the related liability is due and payable.
	All additions and deductions during the year, regardless of when cash is received or paid.

District-Wide Statements
The District-wide statements report information about the School District as a whole using accounting methods similar to those used by private-sector companies. The statement of net position includes all of the School District’s assets and liabilities. All of the current year’s revenue and expenses are accounted for in the statement of activities regardless of when cash is received or paid.

The two District-wide statements report the School District’s net position and how they have changed. Net position – the difference between the School District’s assets and liabilities – is one way to measure the School District’s financial health or position.

•	 Over time, increases or decreases in the School District’s net position are an indicator of whether its financial position is improving or deteriorating, respectively.

•	 For assessment of the overall health of the School District, additional nonfinancial factors such as changes in the property tax bases and the condition of buildings and other facilities should be considered.

Net position of the governmental activities differ from the governmental fund balances because governmental fund level statements only report transactions using or providing current financial resources. Also, capital assets are reported as expenditures when financial resources, (dollars), are expended to purchase or build such assets. Likewise, the financial resources that may have been borrowed are considered revenue when they are received. Principal and interest payments are considered expenditures when paid. Depreciation is not calculated. Capital assets and long-term debt are accounted for in account groups and do not affect the fund balances.

District-wide statements use an economic resources measurement focus and full accrual basis of accounting that involves the following steps to prepare the statement of net position:

	Capitalize current outlays for capital assets. 	Report long-term debt as a liability.
	Depreciate capital assets and allocate the depreciation to the proper function.
	 Calculate revenue and expenditures using the economic resources measurement focus and the full accrual basis of accounting.
	Allocate net position balances as follows: o Investment in capital assets.
o Restricted net position are those with constraints placed on use by external sources or imposed by law.
o Unrestricted net position are net position that do not meet any of the above restrictions.

5

OVERVIEW OF THE FINANCIAL STATEMENTS (Continued)

Fund Financial Statements
The fund financial statements provide more detailed information about the School District’s funds – not the School District as a whole. Funds are accounting devices the School District uses to keep track of specific sources of funding and spending on particular programs. The funds have been established by the State of New York.

The District has two kinds of funds:

•	 Governmental Funds: Most of the School District’s basic services are included in governmental funds, which generally focus on (1) how cash and other financial assets can readily be converted to cash flow in and out and (2) the balances left at year-end that are available for spending. Consequently, the governmental funds statements provide a detailed short-term view that helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance the School District’s programs. Because this information does not encompass the additional long-term focus of the District-wide statements, additional information at the bottom of the governmental funds statements explains the relationship (or differences) between them. The governmental fund statements focus primarily on current financial resources and often have a budgetary orientation. Governmental funds include the general fund, special aid fund, school lunch fund, and the capital projects fund. Required financial statements are the balance sheet and the statement of revenue, expenditures, and changes in fund balance.

•	 Fiduciary Funds: The School District is the trustee, or fiduciary, for assets that belong to others. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the District-wide financial statements because it cannot use these assets to finance its operations. Fiduciary fund reporting focuses on net position and changes in net position.

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE

Figure A-3	Condensed Statement of Net Position (In Thousands of Dollars)

Fiscal Year 2018

Fiscal Year 2017
(As restated)

Percent Change

Current Assets Non-current assets
Total assets

Deferred outflows

Current liabilities Long-term liabilities
Total liabilities

Deferred inflows

Net position:
Net investment in capital assets Restricted
Unrestricted
Total net position

$	6,325
	47,028
	53,353

	10,415

5,175
	61,996
	67,171

	4,800

31,106 1,160
            (40,469) $            (8,203)

$	7,880
	46,523
	54,403

	12,117

5,609
	66,608
	72,217

	445

29,855 1,058
            (37,055) $            (6,142)

-19.73% 1.09%
-1.93%

-14.05%

-7.74% -6.92% -6.99%

978.65%

4.19% 9.64% -9.21%
-33.56%

6

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE (Continued)

Changes in Net Position
The School District’s 2018 revenue was $40,082,635 (See Figure A-4). Property taxes and New York State aid accounted for the majority of revenue by contributing 86% of the total revenue raised (see Figure A-5). The remainder of revenue came from fees for services, use of money and property, operating grants, and other miscellaneous sources.

The total cost of all programs and services totaled $42,143,341 for 2018. These expenses are predominately for the education, supervision, and transportation of students (see Figure A-6). The School District’s administrative and business activities accounted for 12% of total costs.

Net position decreased during the year by $2,060,706.

Figure A-4	Changes in Net position from Operating Results (In Thousands of Dollars)

Revenue:
Charges for services Operating grants

General revenue:
Property taxes and other tax items State aid
Interest earnings Medicaid reimbursement Miscellaneous
Total revenue

Expenses: General support Instruction Transportation
Debt service -Interest Cost of sales – Food
Total expenses

Increase in net position

Fiscal Year 2018

$                781 1,446

21,059 16,100 112 149
	435

	40,082

4,932 34,784 1,392 461
	574
	42,143

$	(2,061)

Fiscal Year 2017

$                704 1,412

20,622 15,505 98
66

	646

	39,053

4,626 32,409 1,212 615
	545
	39,407

$	(354)

Percent Change

10.94% 2.41%

2.12% 3.84% 14.29% 125.76% -32.66% 2.63%

6.61% 7.33% 14.85% -25.04% 5.32% 6.94%

-482.20%

7

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE (Continued)

Figure A-5: Revenue Sources for 2018:

Figure A-6: Sources of Expenses for 2018:

8

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE (Continued)

Governmental Activities
Revenue for the School District’s governmental activities totaled $40,082,635 while total expenses were $42,143,341.	Accordingly, net position decreased by $2,060,706.	The decrease in net position is mainly due to the recording of deferred inflows and outflows for pensions, and an increase in the other postemployment benefit obligation.

Figure A-7 presents the cost of several of the School District’s major activities. The figure also shows each activity’s net cost (total cost less fees generated by the activity and intergovernmental aid provided for specific programs). The net cost shows the financial burden placed on the School District’s taxpayers by each of these functions.

Figure A-7 Net Cost of Governmental Activities (In Thousands of Dollars)

Total Cost of Services 2018

Net Cost of Services 2018

Total Cost of Services 2017

Net Cost of Services 2017

General support Instruction Transportation
Debt service -Interest Cost of sales – Food
Total expenses

$             4,932 34,784
1,392 461
                  574 $           42,143

$             4,932 33,132
1,392 461
		(1) $           39,916

$             4,626 32,409
1,212 615
                  545 $           39,407

$             4,626 30,849
1,212 615
                  (11) $           37,291

The School District’s taxpayers and New York State sources financed the majority of costs.

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT’S FUNDS

Variances between years for the governmental fund financial statements are not the same as variances between years for the District-wide financial statements.	The School District’s governmental funds are presented on the current financial resources measurement focus and the modified accrual basis of accounting. Under this method of presentation, governmental funds do not include long-term liabilities for the funds’ projects and capital assets purchased by the funds. Governmental funds will include proceeds from the issuance of debt, the current payments for capital assets, and the current payments for debt.

9

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT’S FUNDS (Continued)

Governmental Funds Highlights

General Fund –New York State operating aid increased $439,526. Total expenditures increased $1,131,635 mostly due to an increase in instruction expenditures of approximately $576,000, an increase in employee benefits of approximately $295,000 and an increase of approximately $248,000 in general support costs.

Special Aid Fund – Expenditures were consistent with prior year amounts. The District received additional revenues of approximately $151,000 more than the prior year.

School Lunch Fund – Revenues and expenditures were consistent with the prior year amounts.

Capital Projects Fund – The District continued on District-Wide improvement projects,

General Fund Budgetary Highlights

This section presents an analysis of significant variances between original and final budget amounts and between final budget amounts and actual results for the general fund.

Revenue Variances
Miscellaneous revenue was $236,940 more than the budgeted amount due to prior year refund of expenditures while charges for services revenue was $102,515 over budgeted amounts due to additional revenue from tuition from other districts.

Expenditure Variances
The District had positive variances in almost all categories of expenditures. Instruction had a positive variance of $811,411 and general support had a positive variance of $207,350.

10

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT’S FUNDS (Continued)

Results vs. Budget (In Thousands of Dollars)

Revenue: Local sources
State sources

Original Budget

$	21,813	$

15,687

Final Budget

21,745	$

15,688

Actual

22,106	$

15,545

Variance Positive/
Enc.	(Negative)

-	$	361

-	(143)

Federal sources

Total

	20	                        20	                      149	                           -	                      129

	37,520	                 37,453	                 37,800	                           -	                      347

Expenditures: General support Instruction Transportation Employee benefits Debt Service
Principal

Interest

$                 4,005     $                 4,182       $                 3,971         $                        3         $                    208 20,760                      20,945                       20,083                                 51                               811
1,182                        1,324                         1,315                                   1                                  8 9,376                        9,084                         8,982                                    -                               102

2,572	2,572	2,577	-	(5)

647	646	600	-	46

Transfers out

Total

	136	                      136	                      102

	38,678	                 38,889	                 37,630

	-	                        34

	55	                   1,204

Revenue	over	(under)	$	(1,158)	$	(1,436)	$	170	$	(55)	$	1,551 expense

The general fund is the only fund for which a budget is legally adopted.

CAPITAL ASSET AND DEBT ADMINISTRATION

As of June 30, 2018, the School District had $46,356,676 invested in buildings, computers, and other educational equipment.

Figure A-8	Capital Assets (In Thousands of Dollars), net of accumulated depreciation

Fiscal Year 2018

Fiscal Year 2017

Percent Change

Category: Land
Construction in progress Buildings
Improvements other than buildings Furniture, equipment and vehicles
Total

$             1,855 1,662
39,008 1,758
               2,074 $           46,357

$             1,855 -
40,682 1,914
               2,072 $           46,523

0.00% 100% (4.12)% (8.15)%
	0.09%
	(0.36)%

Long-Term Debt

As of June 30, 2018, the School District had $64,779,638 in long-term debt. Detailed information about the School District’s long-term debt is included in the notes to the financial statements.

11

CAPITAL ASSET AND DEBT ADMINISTRATION (Continued)

Figure A-9	Outstanding Long-Term Debt (In Thousands of Dollars)

During 2018, the School District began reporting its total obligation for postemployment benefits.

Category:
General obligation bonds Compensated absences
Other postemployment benefit obligation Net pension liability

Total

Fiscal Year 2018

$           15,251 2,299
46,950
	279

$	64,779

Fiscal Year 2017

(As Restated)

$           17,014 2,277
48,188
	1,781

$	69,260

Percent Change

(10.36)% 0.97% (2.57)%
	(84.33)%

	(6.47)%

FACTORS BEARING ON THE DISTRICT’S FUTURE

The District has stabilized its available fund balance.

Our voters have also authorized a capital reserve for necessary future renovations in anticipation of capital improvement projects and technological upgrades.

CONTACTING THE SCHOOL DISTRICT’S FINANCIAL MANAGEMENT

This financial report is designed to provide the School District’s citizens, taxpayers, customers, investors, and creditors with a general overview of the School District’s finances and to demonstrate the School District’s accountability for the money it receives. If you have questions about this report or need additional financial information, please contact:

Ms. Lisa Weeks Business Manager
Oneonta City School District Administration Center Oneonta, New York 13820

12

ONEONTA CITY SCHOOL DISTRICT

STATEMENT OF NET POSITION JUNE 30, 2018

ASSETS

CURRENT ASSETS:

Cash and cash equivalents - unrestricted Cash and cash equivalents - restricted Accounts receivable
Due from fiduiary funds

State and federal aid receivable Inventories

Total current assets

NONCURRENT ASSETS: Capital assets, net
Net pension asset - TRS

Total non-current assets

DEFERRED OUTFLOWS OF RESOURCES Deferred outflows of resources - pensions - ERS Deferred outflows of resources - pensions - TRS Amounts deferred on advance refunding

TOTAL ASSETS AND DEFERRED OUTFLOWS OF RESOURCES

$       2,522,828 2,174,196 22,244
2,000 1,586,205
	17,442

6,324,915

46,356,676

	671,612

	47,028,288

881,472 8,920,104 613,162

63,767,941

LIABILITIES

CURRENT LIABILITIES: Accounts payable Accrued liabilities Unearned revenue
Due to Teachers' Retirement System Due to Employees' Retirement System Bond interest accrual
Due to other governments Current portion of long term debt

Total current liabilities

LONG-TERM DEBT, net of current portion:

Bonds payable, net of current portion and premium Other postemployment benefits
Net pension liability - ERS Compensated absences

Total long-term liabilities

TOTAL LIABILITIES

DEFERRED INFLOWS OF RESOURCES Deferred inflows of resources - pensions - ERS Deferred inflows of resources - pensions - TRS Deferred inflows of resources - OPEB

TOTAL LIABILITIES AND DEFERRED INFLOWS OF RESOURCES

184,641 551,969 13,087 1,496,344 101,775 42,799 339
	2,783,661

5,174,615

12,467,250 46,950,374 279,492 2,298,861

61,995,977

67,170,592

894,740 1,857,351 2,048,251

71,970,934

NET POSITION

Net investment in capital assets Restricted
Unrestricted

31,105,765 1,160,141
(40,468,899)

TOTAL NET POSITION	$	(8,202,993)

The accompanying notes are an integral part of these statements. 13

ONEONTA CITY SCHOOL DISTRICT

STATEMENT OF ACTIVITIES

FOR THE YEAR ENDED JUNE 30, 2018

Net (Expense) Program Revenue	Revenue and

Charges for Expenses	Services

Operating Grants

Changes in Net Position

FUNCTIONS/PROGRAMS:

General support	$	4,932,871	$	-	$	-	$	(4,932,871)

Instruction
Pupil transportation Debt service interest School lunch program

34,784,112 1,392,169 460,589 573,600

657,714 --
123,251

994,348 --
451,721

(33,132,050) (1,392,169) (460,589)
1,372

TOTAL FUNCTIONS/PROGRAMS	$     42,143,341	$	780,965	$	1,446,069	(39,916,307)

GENERAL REVENUE:

Real property taxes Other tax items
Use of money and property

Sale of property and compensation for loss Miscellaneous
State sources

Medicaid reimbursement

TOTAL GENERAL REVENUE

CHANGE IN NET POSITION

Net Position - beginning of year, as previously reported

Cumulative effect of prior period adjustment (Note 2)

Net position - beginning of year, as restated

Change in net position

18,412,926 2,646,353 112,046 26,089 409,212 16,100,070 148,905

37,855,601

(2,060,706)

9,714,489

(15,856,776)

(6,142,287)

(2,060,706)

TOTAL NET POSITION - end of year	$	(8,202,993)

The accompanying notes are an integral part of these statements. 14

ONEONTA CITY SCHOOL DISTRICT

BALANCE SHEET - GOVERNMENTAL FUNDS JUNE 30, 2018

Governmental Fund Types Special                    School
General	Aid	Lunch

Capital Projects

Total Governmental Funds

ASSETS

Cash and cash equivalents - unrestricted Cash and cash equivalents - restricted Accounts receivable
Due from other funds

Due from Private Purpose Trust fund State and federal aid receivable Inventory

TOTAL ASSETS

$       2,336,050       $ 1,160,141
20,610 2,081,449 2,000 1,250,893 -

$	6,851,143	$

125,755	$ -
-22,295 -
335,312 -

483,362	$

57,615       $ -
1,634 ---
17,442

76,691	$

3,408 1,014,055 -
----

1,017,463

$       2,522,828 2,174,196 22,244 2,103,744 2,000 1,586,205 17,442

$	8,428,659

LIABILITIES AND FUND BALANCES

LIABILITIES:

Accounts payable Accrued liabilities BAN payable Unearned revenue Due to other funds
Due to other governments

Due to Teachers' Retirement System Due to Employees' Retirement System

TOTAL LIABILITIES

$	180,849	$ 545,873
--
22,295 -
1,496,344 101,775

2,347,136

3,792	$ 6,096
--
420,875 ---

430,763

-	$	--                              --                              -
13,087                              --               1,660,574
339	--	--	-

13,426	1,660,574

$         184,641 551,969
-13,087
2,103,744 339 1,496,344 101,775

4,451,899

DEFERRED INFLOWS OF RESOURCES:
Deferred revenue	109,443	-	-	-	109,443

(Continued)

The accompanying notes are an integral part of these statements. 15

ONEONTA CITY SCHOOL DISTRICT

BALANCE SHEET - GOVERNMENTAL FUNDS (CONTINUED) JUNE 30, 2018

General FUND BALANCES:

Governmental Fund Types Special                    School
Aid	Lunch

Capital Projects

Total Governmental Funds

Nonspendable Inventory
Total nonspendable fund balance

$	 -	$	-	$	17,442	$ -                              -                    17,442

-       $           17,442 -                    17,442

Restricted

Employee benefits and accrued liabilities Tax certiorari
Repair Reserve Unemployment

Total restricted fund balance

Assigned Other
Appropriated for subsequent year expenditures

Total assigned fund balance

Unassigned

TOTAL FUND BALANCES

293,551 65,961 750,000 50,629

	1,160,141

55,061

	1,225,575

	 1,280,636

1,953,787

4,394,564

-	--	--	--	-

	-	                       -

52,599                    20,526 -                              -

	 52,599	             20,526

-	25,297

52,599	63,265

----

	 -

--

	 -

(643,111)

(643,111)

293,551 65,961 750,000 50,629

	1,160,141

128,186 1,225,575

	1,353,761

1,335,973

3,867,317

TOTAL LIABILITIES, DEFERRED INFLOWS OF

RESOURCES AND FUND BALANCES	$	6,851,143	$	483,362	$	76,691	$	1,017,463	$	8,428,659

The accompanying notes are an integral part of these statements. 16

ONEONTA CITY SCHOOL DISTRICT

RECONCILIATION OF TOTAL GOVERNMENTAL FUND BALANCE TO GOVERNMENT-WIDE NET POSITION JUNE 30, 2018

Amounts reported for governmental activities in the statement of net position are different because:

Total governmental balances per above	$	3,867,317

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

GASB 68 related government wide activity: Deferred outflows of resources
Net pension asset Net pension liability
Deferred inflows of resources

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

Amounts deferred on advance refunding is not recognized in the governmental funds.

Compensated absences are recognized as a liability under full accrual accounting.

Other postemployment benefits are recognized as a liability under full accrual accounting.

Deferred outflows/inflows of resources related to other postemployment benefits are applicable to future periods and therefore, are not reported in the funds.
Deferred inflows - OPEB Deferred outflows -OPEB

Interest payable is recorded as a liability under full accrual accounting.

Unearned revenue in the current year is recognized as revenue under full accrual accounting.

46,356,676

9,801,576 671,612
(279,492) (2,752,091)

(15,250,911)

613,162

(2,298,861)

(46,950,374)

(2,048,251) -

(42,799)

109,443

NET POSITION OF GOVERNMENTAL ACTIVITIES AT YEAR END	$	(8,202,993)

The accompanying notes are an integral part of these statements. 17

ONEONTA CITY SCHOOL DISTRICT

STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCE - GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2018

Governmental Fund Types	Total

General

REVENUE:

Special Aid

School	Capital Lunch                    Projects

Governmental Funds

Real property taxes Other tax items Charges for services
Use of money and property

Sale of property and compensation for loss Miscellaneous
State sources

Medicaid reimbursement Federal sources
Surplus food

Sales - School lunch

Total revenue

EXPENDITURES: General support Instruction
Pupil transportation Employee benefits Debt service - Interest Debt service - Principal Cost of sales
Capital outlay

Total expenditures

EXCESS (DEFICIENCY) OF REVENUE OVER EXPENDITURES

OTHER SOURCES AND (USES): Proceeds from the issuance of debt Payment to escrow agent
Premium on obligations - bonds payable Operating transfers in
Operating transfers (out)

Total other sources (uses)

EXCESS (DEFICIENCY) OF REVENUE AND OTHER SOURCES OVER EXPENDITURES AND OTHER USES

FUND BALANCES - beginning of year

FUND BALANCES - end of year

$     18,412,926       $ 2,646,353
508,142 98,064 26,089 414,485 15,545,348 148,905
---

37,800,312

3,971,356 20,082,963 1,315,024 8,982,057 599,735 2,576,532 -
-

37,527,667

272,645

----
(102,373)

(102,373)

170,272

4,224,292

$	4,394,564	$

-	$ -
149,572 ---
554,722 -994,348 -
-

1,698,642

-1,465,439 32,844 298,056
----

1,796,339

(97,697)

---
77,373 -

77,373

(20,324)

72,923

52,599	$

---6 -
3,386 46,967 -369,510 35,244 123,251

578,364

------
573,600 -

573,600

4,764

---
25,000 -

25,000

29,764

33,501

63,265

$	 ---
13,976 -------

13,976

105,188 ------
1,684,285

1,789,473

(1,775,497)

4,593,930 (4,649,784)
634,972 --

579,118

(1,196,379)

553,268

$	(643,111)

$     18,412,926 2,646,353 657,714 112,046 26,089 417,871 16,147,037 148,905 1,363,858 35,244 123,251

40,091,294

4,076,544 21,548,402 1,347,868 9,280,113 599,735 2,576,532 573,600 1,684,285

41,687,079

(1,595,785)

4,593,930 (4,649,784)
634,972 102,373 (102,373)

579,118

(1,016,667)

4,883,984

$	3,867,317

The accompanying notes are an integral part of these statements. 18

ONEONTA CITY SCHOOL DISTRICT

RECONCILIATION OF THE STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2018

Net changes in fund balance - Total governmental funds	$	(1,016,667)

Capital outlays, net of disposals are expenditures in governmental funds, but are capitalized in the statement of net position.

Depreciation is not recorded as a expenditure in the governmental funds, but is recorded in the statement of activities.

Pension expense resulting from the GASB 68 related actuary reporting is not recorded as an expenditure in the government funds but is recorded in the statement of activities.

Bond premium amortization is not recorded as an expenditure in the governmental funds, but is recorded in the statement of activities.

Repayments of long-term debt and refunding debt are recorded as expenditures in the governmental funds, but are recorded as payments of liabilities in the statement of net position.

Bond proceeds and premiums from refunding are recorded as an other financing source in the governmental funds but are recorded as in increase in long-term debt in the statement of net position.

Accrued post-employment benefits do not require the expenditure of current resources and, therefore are not reported as expenditures in the governmental funds.

Compensated absences do not require the expenditure of current resources and, therefore, are not reported as expenditures in the governmental funds.

Accrued interest expense does not require the expenditure of current resources and is, therefore, not reported as expenditures in the governmental funds.

Proceeds from issuance of long-term debt are recorded as revenue in the governmental funds, but is recorded as an addition to long-term debt in the statement of net position.

Amortization on refunding is recorded on the government wide statements, but not recorded in the governmental funds.

2,129,648

(2,296,175)

(244,815)

190,661

7,226,316

(4,754,972)

(2,747,434)

(21,823)

26,957

(473,930)

(78,472)

Change in net position - Governmental activities	$	(2,060,706)

The accompanying notes are an integral part of these statements. 19

ONEONTA CITY SCHOOL DISTRICT

STATEMENT OF NET POSITION - FIDUCIARY FUNDS JUNE 30, 2018

Private Purpose
Agency	Trusts

ASSETS: Cash
Restricted cash

Due from other funds Investments

Total assets

LIABILITIES:
Extraclassroom activity balances Due to other funds
Other liabilities

$	12,326	$ 98,907
--

$	111,233	$

$	98,907	$ -
12,326

-249,913 -
63,038

312,951

-2,000 -

Total liabilities	$	111,233	2,000

NET POSITION:

Reserved for scholarships	            310,951

Total net position	$	310,951

STATEMENT OF CHANGES IN NET POSITION - FIDUCIARY FUNDS FOR THE YEAR ENDED JUNE 30, 2018

Private Purpose Trusts

ADDITIONS:
Gifts and contributions                                                                                                           $              7,302 Interest                                                                                                                                                  1,621

Total additions

DEDUCTIONS:

Scholarships and awards Change in value of securities

Change in net position

NET POSITION - beginning of year

8,923

11,905

	4,201

	16,106

(7,183)

318,134

NET POSITION - end of year	$	310,951

The accompanying notes are an integral part of these statements. 20

ONEONTA CITY SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2018

1.	NATURE OF OPERATIONS

Oneonta City School District (School District) provides K-12 public education to students living within its geographic borders.

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The financial statements of Oneonta City School District have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental units.	Those principles are prescribed by the Governmental Accounting Standards Board, (GASB), which is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

Significant accounting principles and policies utilized by the School District are described below:

Reporting Entity

The Oneonta City School District is governed by the laws of New York State. The School District is an independent entity governed by an elected Board of Education. The President of the Board of Education serves as the chief fiscal officer and the Superintendent is the chief executive officer. The Board is responsible for, and controls all activities related to public school education within the School District. The Board of Education has the authority to make decisions, power to appoint management, and primary accountability for all fiscal matters.

The financial reporting entity consists of the primary government, organizations for which the primary government is financially accountable and other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete.

The accompanying financial statements present the activities of the School District. The School District is not a component unit of another reporting entity. The decision to include a potential component unit in the School District’s reporting entity is based on several criteria including legal standing, fiscal dependency, and financial accountability.	Based on the application of these criteria, the following is a brief description of an entity included in the School District’s reporting entity.

Extraclassroom Activity Funds
The extraclassroom activity funds of the School District represent funds of the students of the School District. The Board of Education exercises general oversight of these funds. The extraclassroom activity funds are independent of the School District with respect to its financial transactions and the designation of student management. Separate audited financial statements, (cash basis) of the extraclassroom activity funds can be found at the School District’s business office. The School District accounts for assets held as an agent for various student organizations in the agency fund.

21

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Joint Venture
The School District is a component school district of the Otsego Northern Catskills Board of Cooperative Educational Service (BOCES). BOCES is a voluntary, cooperative association of school districts in a geographic area that shares planning, services, and programs which provide educational and support activities. There is no authority or process by which a school district can terminate its status as a BOCES component.

BOCES are organized under §1950 of the New York State Education Law. A BOCES board is considered a corporate body. Members of a BOCES board are nominated and elected by their component member boards in accordance with provisions of §1950 of the New York State Education Law. All BOCES property is held by the BOCES board as a corporation (§1950(6)). In addition, BOCES boards also are considered municipal corporations to permit them to contract with other municipalities on a cooperative basis under §119-n(a) of the New York State General Municipal Law.

BOCES’ budget is comprised of separate budgets for administrative, program, and capital costs. Each component school district’s share of administrative and capital cost is determined by resident public school district enrollment, as defined in the New York State Education Law, §1950(4)(b)(7).	In addition, component school districts pay tuition or a service fee for programs in which its students participate.

Financial statements for the BOCES are available from the BOCES administrative office.

Basis of Presentation
The School District’s financial statements consist of school government-wide financial statements, including a Statement of Net Position and a Statement of Activities, and fund level financial statements which provide more detailed information.

The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund balance, revenues and expenditures, as appropriate. Governmental resources are allocated to and accounted in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled.

Government-Wide Statements
The statement of net position and statement of activities present financial information about the School District’s governmental activities. These statements include the financial activities of the overall government in its entirety, except those that are fiduciary. Eliminations have been made to minimize the double counting of internal transactions. Governmental activities generally are financed through taxes, state aid, intergovernmental revenue, and other exchange and non-exchange transactions. Operating grants include operating-specific and discretionary (either operating or capital), grants, while the capital grants column reflects capital-specific grants.

The statement of activities presents a comparison between direct expenses and program revenue for each function of the School District’s governmental activities. Direct expenses are those that are specifically associated with and are clearly identifiable to a particular function. Indirect expenses, principally employee benefits, are allocated to functional areas in proportion to the payroll expended for those areas. Program revenue includes charges paid by the recipients of goods or services offered by the programs and grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenue that is not classified as program revenue, including all taxes, is presented as general revenue.

22

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Basis of Presentation (Continued)

Fund Financial Statements
The School District uses funds to maintain its accounting records. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain government functions or activities. The fund statements provide information about the School District’s funds, including fiduciary funds. Separate statements for each fund category (governmental and fiduciary) are presented.	The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. The District financial statements show all governmental funds as major funds. The fund types used by the School District are as follows:

General Fund: This is the School District’s primary operating fund. It accounts for all financial transactions that are not required to be accounted for in another fund.

Special Aid Fund: This is a special revenue fund that accounts for the proceeds of specific revenue sources, such as federal and state grants, that are legally restricted to expenditures for specified purposes and other activities whose funds are restricted as to use. These legal restrictions may be imposed either by governments that provide the funds, or by outside parties.

School Lunch Fund: This is a special revenue fund that accounts for the financial transactions related to the food service operations of the District.

Capital Projects Fund: These funds are used to account for the financial resources used for acquisition, construction, or major repair of capital facilities.

Fiduciary Fund Types
Fiduciary funds are used to account for assets held by the School District as an agent for individuals, private organizations, other governmental units, and/or other funds.

Fiduciary Fund: This fund is used to account for fiduciary activities. Fiduciary activities are those in which the School District acts as trustee or agent for resources that belong to others. These activities are not included in the School District-wide financial statements, because their resources do not belong to the School District and are not available to be used.

There are two classes of fiduciary funds:

	Private purpose trust funds: These funds are used to account for trust arrangements in which principal and income benefits annual third party awards and scholarships for students. Established criteria govern the use of the funds and members of the District or representatives of the donors may serve on committees to determine who benefits.

	Agency funds: These funds are strictly custodial in nature and do not involve the measurement of results of operations. Assets are held by the District as agent for various student groups or extraclassroom activity funds and for payroll or employee withholding.

23

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenue and expenditures during the reporting period. Actual results could differ from those estimates. Estimates and assumptions are made in a variety of areas, including computation of encumbrances, compensated absences, potential contingent liabilities, and useful lives of long-lived assets.

Measurement Focus and Basis of Accounting
Measurement focus refers to what is being measured, whereas basis of accounting refers to when revenues and expenditures are recognized. Basis of accounting relates to the timing of the measurement made, regardless of the measurement focus applied.

The School District-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenue is recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash transaction takes place. Non-exchange transactions in which the School District gives or receives value without directly receiving or giving equal value in exchange include property taxes, grants, and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.

The governmental fund statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenue is recognized when measurable and available. The School District considers all revenue reported in the governmental funds to be available if the revenue is collected within sixty days after the end of the fiscal year.

Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured.	General capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term debt and acquisitions under capital leases are reported as other financing sources.

Cash and Cash Equivalents
The School District’s cash and cash equivalents consist of cash on hand, demand deposits, and short-term investments with original maturities of three months or less from date of acquisition.

New York State law governs the School District’s investment policies. Resources must be deposited in FDIC-insured commercial banks or trust companies located within the state. Permissible investments include obligations of the United States Treasury, United States Agencies, repurchase agreements, and obligations of New York State or its localities.

Collateral is required for demand and time deposits and certificates of deposit not covered by FDIC insurance. Obligations that may be pledged as collateral are obligations of the United States and its agencies and obligations of the State and its municipalities and districts.

Restricted Cash
Restricted cash represents cash and cash equivalents where use is limited by legal requirements. These assets represent amounts required by statute to be reserved for various purposes.

24

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Accounts Receivable
Accounts receivable are shown gross.	No allowance for uncollectible accounts has been provided since it is believed that such allowance would not be material.

Inventories
Inventories of food in the school lunch fund are recorded at cost on a first-in, first-out basis, or in the case of surplus food, at stated value which approximates market. Purchases of inventoriable items in other funds are recorded as expenditures at the time of purchase, and are considered immaterial in amount.

Interfund Transactions
The operations of the District include transactions between funds. These transactions may be temporary in nature, such as with interfund borrowings. The District typically loans resources between funds for the purpose of providing cash flow. These interfund receivables and payables are expected to be repaid within one year. Permanent transfers of funds include the transfer of expenditures and revenue to provide financing or other services.

In the District-wide statements, the amounts reported on the Statement of Net Position for interfund receivables and payables represent amounts due between different fund types (governmental activities and fiduciary funds). Eliminations have been made for all interfund receivables and payables between the funds, with the exception of those due from or to the fiduciary funds.

The governmental funds report all interfund transactions as originally recorded. Interfund receivables and payables may be netted on the accompanying governmental funds balance sheet when it is the District’s practice to settle these amounts at a net balance based upon the right of legal offset.

Capital Assets
Capital assets are reported at actual cost for acquisitions subsequent to July 1, 2002. For assets acquired prior to July 1, 2002, estimated historical costs, based on appraisals conducted by independent third-party professionals were used. Donated assets are reported at estimated fair market value at the time received.

Capitalization thresholds, (the dollar value above which asset acquisitions are added to the capital asset accounts), depreciation methods, and estimated useful lives of capital assets reported in the School District-wide statements are as follows:

Capitalization
 Threshold 

Depreciation
 Method	

Estimated Useful Life

Land
Land improvements Buildings
Furniture and equipment Vehicles

$ 1,000	N/A	20 $ 1,000                   SL	20 $ 1,000                   SL	50 $ 1,000                   SL                 5-20 $ 1,000                   SL                       8

25

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Short-Term Debt
The District may issue Revenue Anticipation Notes (RANs) and Tax Anticipation Notes (TANs), in anticipation of the receipt of revenue. These notes are recorded as a liability of the fund that will actually receive the proceeds from the issuance of the notes. The RANs and TANs represent a liability that will be extinguished by the use of expendable, available resources of the fund.

The District may issue budget notes up to an amount not to exceed 5% of the amount of the annual budget during any fiscal year for expenditures for which there is an insufficient or no provision made in the annual budget. The budget note must be repaid no later than the close of the second fiscal year succeeding the year in which the note was issued.

The District may issue Bond Anticipation Notes (BANs), in anticipation of proceeds from the subsequent sale of bonds. These notes are recorded as current liabilities of the funds that will actually receive the proceeds from the issuance of bonds. State law requires that BANs issued for capital purposes be converted to long-term financing within five years after the original issue date.

Deferred Outflows and Inflows of Resources
In addition to assets, the Statement of Net Position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period and so will not be recognized as an outflow of resources (expenses/expenditure) until then.

The government has the following items that qualify for reporting in this category:

	 Deferred charges result from pension contributions made subsequent to the measurement date of the plan.

	Deferred charges result from differences between expected and actual experience of the pension plans.

	 Deferred charges result from net differences between projected and actual earnings on pension plan investments of the plans.

	Deferred charges resulting from a bond refunding.

Pension plan related charges that are deferred are amortized and expensed against pension expense in future periods. Deferred charges related to the bond refunding are amortized against interest expense in future periods.

In addition to liabilities, the Statement of Net Position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period and so will not be recognized as an inflow of resources (revenue) until then.

26

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Deferred Outflows and Inflows of Resources (Continued)

The government has the following items that qualify for reporting in this category:

	 Deferred charges result from differences between actual and expected experience relating to pension plans

	 Deferred charges result from pension related changes in proportion and differences between the District’s contributions and proportionate share of contributions.

	Deferred charges result from OPEB related changes in assumptions.

Pension plan charges that are deferred are amortized and expensed against pension expense in future periods. Deferred charges related to OPEB are amortized and expensed against employee health care costs in a future period.

Vested Employee Benefits

Compensated Absences
Compensated absences consist of unpaid accumulated annual sick leave, vacation, and sabbatical time.

Sick leave eligibility and accumulation is specified in negotiated labor contracts, and in individual employment contracts.	Upon retirement, resignation or death, employees may contractually receive a payment based on unused accumulated sick leave.

District employees are granted vacation in varying amounts, based primarily on length of service and service position. Some earned benefits may be forfeited if not taken within varying time periods.

Consistent with generally accepted accounting principles, an accrual for accumulated sick leave is included in the compensated absences liability at year-end.	The compensated absences liability is calculated based on the pay rates in effect at year-end.

In the funds statements, only the amount of matured liabilities is accrued within the general fund based upon expendable and available financial resources. These amounts are expensed on a pay-as-you go basis.

Other Benefits
School District employees participate in the New York State Employees’ Retirement System and the New York State Teachers’ Retirement System.

Other Postemployment Benefits
In addition to providing the pension benefits, the School District provides other postemployment health insurance coverage and survivor benefits to retired employees and their survivors in accordance with the provisions of various employment contracts in effect at the time of retirement. Substantially all of the School District’s employees may become eligible for these benefits if they reach normal retirement age while working for the School District. Health care benefits are provided through plans whose premiums are based on the benefits paid during the year. The School District recognizes the cost of providing health insurance by recording its share of insurance premiums as an expenditure at the fund level.

27

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Property Taxes
Real property taxes are levied annually by the Board of Education and then, become a lien. Taxes are collected during the period September 1 to October 31.

Uncollected real property taxes are subsequently enforced by the Counties of Otsego and Delaware in which the School District is located. The Counties pay an amount representing uncollected real property taxes transmitted to the Counties for enforcement to the School District no later than the following April 1.

Property taxes not collected within the 60 period of availability will then be considered non-current and be reclassified to deferred revenue.

Tax Abatement Program
The District is subject to tax abatements granted by the Otsego County Industrial Development Agency. The Agency was created in accordance with New York State Industrial Development Agency Act of 1969 to promote and develop the economic growth within the County and to assist in attracting industry to the County through various programs and other activities. The tax abatements are for the acquisition, construction and renovation of various properties in Otsego County. The total property taxes abated were $351,695.

Deferred Revenue
Deferred revenue is reported when potential revenue does meet both the measurable and available criteria for recognition in the current period. Deferred revenue also arises when resources are received by the School District before it has legal claim to them, as when grant monies are received prior to the incidence of qualifying expenditures. In subsequent periods, when both recognition criteria are met, or when the School District has legal claim to the resources, the liability for deferred revenue is removed and revenue is recorded.

Statute provides the authority for the School District to levy taxes to be used to finance expenditures within the first 90 days of the succeeding fiscal year. Consequently, such amounts are recognized as revenue in the subsequent fiscal year rather than when measurable and available.

Unearned Revenue
Unearned revenue in the School Lunch Fund represent amounts prepaid by students for meals.

Accrued Liabilities and Long-Term Obligations
Payables, accrued liabilities, and long-term obligations are reported in the District-wide financial statements. In the governmental funds, payables and accrued liabilities are paid in a timely manner and in full from current financial resources.

Claims and judgments, and compensated absences that will be paid from governmental funds, are reported as a liability in the fund financial statements only to the extent that they are due for payment in the current year. Bonds and other long-term obligations that will be paid from governmental funds are recognized as a liability in the fund financial statements when due.

Long-term obligations represent the District’s future obligations or future economic outflows. The liabilities are reported as due in one year or due within more than one year in the Statement of Net Position.

28

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Encumbrances
Encumbrance accounting is used for budgetary control and monitoring purposes and is reported as a part of the governmental funds. Under this method, purchase orders, contract and other commitments for the expenditure of monies are recorded to reserve applicable appropriations. Outstanding encumbrances as of year-end are presented as reservations of fund balance and do not represent expenditures or liabilities. These commitments will be honored in the subsequent period. Related expenditures are recognized at that time, as the liability is incurred or the commitment is paid.

Restricted Resources
When an expense is incurred for purposes for which both restricted and unrestricted net position are available, the School District’s policy concerning which to apply first varies with the intended use, and with associated legal requirements, many of which are described elsewhere in these notes.

Net Position / Fund Balance Classifications

Government-Wide Statements
In the government-wide statements, there are three classes of net position:

Net Investment in capital assets - consists of net capital assets, (cost less accumulated depreciation) plus unspent bond proceeds reduced by outstanding balances of related debt obligations from the acquisition, construction, or improvements of those assets.

Restricted net position - reports net position when constraints placed on the assets are either externally imposed by creditors, (such as through debt covenants), grantors, contributors, or laws or regulations of other governments, or imposed by law through constitutional provisions or enabling legislation.

Restricted net position consists of the following:

Employee benefits and accrued liabilities Tax certiorari
Repair reserve Unemployment
Total

$         293,551 65,961 750,000
             50,629 $      1,160,141

Unrestricted net position - reports all other net position that do not meet the definition of the above two classifications and are deemed to be available for general use by the District.

Governmental Fund Statements
In the fund basis statements there are five classifications of fund balance.

Nonspendable fund balance - Includes amounts that cannot be spent because they are either not in spendable form or legally or contractually are required to be maintained intact.

Non-spendable fund balance includes the inventory recorded in the school lunch fund.

Restricted fund balance - Includes amounts with constraints placed on the use of resources either externally imposed by creditors, grantors, contributors or laws or regulations of other governments; or imposed by law through constitutional provisions or enabling legislation.

29

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Net Position / Fund Balance Classifications (Continued)

Governmental Fund Statements (Continued)

The School District has available the following restricted fund balances:

Repair Reserve
Repair Reserve (GML §6-d) is used to pay the cost of repairs to capital improvements or equipment, which repairs are of a type not recurring annually or at shorter intervals. Sources of funds include budgetary appropriations or other revenues that may be legally appropriated and are not required by law to be paid into any other fund or account. This reserve is accounted for in the general fund under restricted fund balance.

Unemployment Insurance
Unemployment insurance reserve (GML §6-m) is used to pay the cost of reimbursement to the State Unemployment Insurance Fund for payments made to claimants where the employer has elected to use the benefit reimbursement method. The reserve may be established by board action and is funded by budgetary appropriations and such other funds as may be legally appropriated. Within sixty days after the end of any fiscal year, excess amounts may either be transferred to another reserve or the excess applied to the appropriations of the next succeeding fiscal year’s budget. If the School District elects to convert to contribution basis, excess resources in the fund over the sum sufficient to pay pending claims may be transferred to any other reserve fund. This reserve is accounted for in the general fund under restricted fund balance.

Tax Certiorari
Tax certiorari reserve, (Education Law §3651.1-a), is used to establish a reserve fund for tax certiorari and to expend from the fund without voter approval. The monies held in the reserve shall not exceed the amount which might reasonably be deemed necessary to meet anticipated judgments and claims arising out of tax certiorari proceedings. Any resources deposited to the reserve which are not expended for tax certiorari proceedings in the year such monies are deposited must be returned to the general fund on or before the first day of the fourth fiscal year after deposit of these monies. The reserve is accounted for in the general fund under restricted fund balance.

Employee Benefits and Accrued Liability
Reserve for employee benefit accrued liability (GML §6-p) is used to reserve funds for the payment of accrued employee benefit due to an employee upon termination of the employee’s service. This reserve may be established by a majority vote of the board, and is funded by budgetary appropriations and such other reserves and funds that may be legally appropriated. The reserve is accounted for in the general fund under restricted fund balance.

Committed fund balance - Includes amounts that can be used for the specific purposes pursuant to constraints imposed by formal action of the School District’s highest level of decision making authority, i.e., the Board of Education. The School District has no committed fund balances as of June 30, 2018.

30

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Net Position / Fund Balance Classifications (Continued)

Assigned fund balance - Includes amounts that are constrained by the School District’s intent to be used for specific purposes, but are neither restricted nor committed. This balance includes appropriations of $1,225,575 to fund fiscal year 2018-2019 operating expenditures. All positive fund balance in funds other than the general fund that are not otherwise classified as nonspendable or restricted are classified as assigned fund balances. All encumbrances of the general fund are classified as assigned fund balance. Encumbrances reported in the general fund amounted to $55,061. As of June 30, 2018, the School District’s encumbrances were classified as follows:

General Support Instruction
Total encumbrances

$	4,050
             51,011 $           55,061

Unassigned fund balance - Includes all other general fund amounts that do not meet the definition of the above four classifications and are deemed to be available for general use by the School District.

New York State Real Property Tax Law §1318 limits the amount of unexpended surplus funds the School District can retain to no more than 4% of the School District’s budget for the general fund for the ensuing fiscal year. Non-spendable and restricted fund balance of the general fund are excluded from the 4% limitation. Amounts appropriated for the subsequent year and encumbrances are also excluded from the 4% limitation.

Order of Fund Balance Spending Policy
The District’s policy is to apply expenditures against non-spendable fund balance, restricted fund balance, committed fund balance, assigned fund balance, and unassigned fund balance at the end of the fiscal year.

For all funds, non-spendable fund balances are determined first and then restricted fund balances for specific purposes are determined. Any remaining fund balance amounts for funds other than the general fund are classified as restricted fund balance. In the general fund, committed fund balance is determined next and then assigned.

The remaining amounts are reported as unassigned. Assignments of fund balance cannot cause a negative unassigned fund balance.

Prior Period Adjustments

Change in Accounting Principle - Governmental Activities
The District adopted GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. Statement No. 75 established standards for recognizing and measuring liabilities, deferred outflows of resources, deferred inflows of resources, and expense/expenditures related to certain postemployment benefits. For defined benefit OPEB, this Statement identifies the methods and assumptions that are required to 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.

31

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Prior Period Adjustments (Continued)

Accordingly, beginning net position and other postemployment benefits on the statement of net position were adjusted as noted in the table below.

Other Post-
employment Benefits

Deferred Outflows – Other Postemployment Benefits Related
Net Position

Balance at June 30, 2017, as previously reported	$ (30,394,415)	$	-	$ 9,714,489

Adoption of GASB Statement No. 75

Increase to liability

Contributions subsequent to measurement date

Balance at July 1, 2017, as restated

(17,793,758)

	-

$ (48,188,173)

-

	1,936,982

$	1,936,982

(17,793,758)

	1,936,982

$ (6,142,287)

3.	EXPLANATION OF CERTAIN DIFFERENCES BETWEEN GOVERNMENTAL FUND STATEMENTS AND SCHOOL DISTRICT-WIDE STATEMENTS

Due to the differences in the measurement focus and basis of accounting used in the governmental fund statements and the School District-wide statements, certain financial transactions are treated differently. The basic financial statements contain a full reconciliation of these items. The differences result primarily from the economic focus of the statement of activities compared with the current financial resources focus of the governmental funds.

Total Fund Balances of Governmental Funds vs. Net Position of Governmental Activities
Total fund balances of the School District’s governmental funds differ from “net position” of governmental activities reported in the statement of net position. This difference primarily results from the additional long-term economic focus of the statement of net position versus the solely current financial resources focus of the governmental fund balance sheets.

Statement of Revenue, Expenditures, and Changes in Fund Balance vs. Statement of Activities
Differences between the governmental funds statement of revenue, expenditures, and changes in fund balance and the statement of activities fall into one of three broad categories.

32

3.	EXPLANATION OF CERTAIN DIFFERENCES BETWEEN GOVERNMENTAL FUND STATEMENTS AND SCHOOL DISTRICT-WIDE STATEMENTS (Continued)

Statement of Revenue, Expenditures, and Changes in Fund Balance vs. Statement of Activities (Continued)

Long-Term Revenue and Expense Differences
Long-term revenue differences arise because governmental funds report revenue only when it is considered “available”, whereas the statement of activities reports revenue when earned. Differences in long-term expenses arise because governmental funds report on a modified accrual basis, whereas the accrual basis of accounting is used on the statement of activities.

Capital Related Differences
Capital related differences include the difference between proceeds for the sale of capital assets reported on governmental fund statements and the gain or loss on the sale of assets as reported on the statement of activities, and the difference between recording an expenditure for the purchase of capital items in the governmental fund statements and depreciation expense on those items as recorded in the statement of activities.

Long-Term Debt Transaction Differences
Long-term debt transaction differences occur because both interest and principal payments are recorded as expenditures in the governmental fund statements, whereas interest payments are recorded in the statement of activities as incurred, and principal payments are recorded as a reduction of liabilities in the statement of net position.

4.	STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY

Budgets
The District administration prepares a proposed budget for approval by the Board of Education for the following governmental funds for which legal (appropriated) budgets are adopted:

The voters of the District approved the proposed appropriation budget for the General Fund.

Appropriations are adopted at the program line item level.

Appropriations established by the adoption of the budget constitute a limitation on expenditures, (and encumbrances), that may be incurred. Appropriations lapse at the end of the fiscal year unless expended or encumbered. Encumbrances will lapse if not expended in the subsequent year. Appropriations authorized for the current year are increased by the planned use of specific reserves, and budget amendments approved by the Board of Education as a result of selected new revenue sources not included in the original budget, (when permitted by law). These supplemental appropriations may occur subject to legal restrictions, if the Board approves them because of a need that exists which was not determined at the time the budget was adopted.

Budgets are adopted annually on a basis consistent with generally accepted accounting principles.	Appropriations authorized for the year are increased by the amount of encumbrances carried forward from the previous year.

Budgets are established and used for individual capital project funds expenditures as approved by a special referendum of the District’s voters. The maximum project amount authorized is based primarily upon the cost of the project, plus any requirements for external borrowings, not annual appropriations. These budgets do not lapse and are carried over to subsequent fiscal years until the completion of the projects.

33

5.	CUSTODIAL CREDIT, CONCENTRATION OF CREDIT RISK

Custodial credit risk is the risk that in the event of a bank failure, the District’s deposits may not be returned to it. While the District does not have a specific policy for custodial credit risk, New York State statutes govern the District’s investment policies, as discussed previously in these notes.

The District’s aggregate bank balances were insured and collateralized as follows:

Bank Balance
Cash and cash equivalents, including fiduciary funds	$	5,444,263

Carrying Amount
$	5,058,170

Collateralized with securities held by the pledging

financial institution’s trust department or agent	$	4,444,263

Covered by FDIC insurance

Total

	1,000,000

$	5,444,263

Restricted cash represents cash and cash equivalents where use is limited by legal requirements. These assets represent amounts required by statute to be reserved for various purposes.

General fund
Cash on deposit for reserves Capital projects fund:
Cash on deposit for projects Trust and agency fund:
Cash on deposit for extraclassroom activity funds Private purpose trust fund
Restricted cash for scholarships

Total restricted cash

$	1,160,141

1,014,055

98,907

	249,913

$	2,523,016

6.	INVESTMENTS FOR SCHOLARSHIP FUND

The District has received various donations which were given for the purpose of providing scholarships for students of the District based on income earned on the investments. These investments consist of stock which is accounted for in the Private Purpose Trust Fund and are either held by a third party or in a safe deposit box in the District’s name. At June 30, 2018 the District had the following investments:

IBM Stock JC Penny

Cost	Market
$              6,785         $            62,851 $                 600         $                 187

7.	PARTICIPATION IN BOCES

During the year, the School District was billed $3,828,115 for BOCES administrative and program costs.

The School District’s share of BOCES aid amounted to $1,269,752 for the period ending June 30, 2018.

34

8.	CAPITAL ASSETS

Capital asset balances and activity for the year ended June 30, 2018, were as follows:

Governmental activities:

Capital assets that are not depreciated:

Beginning

Balance

Disposals/

Additions	Transfers

Ending

Balance

Land	$	1,855,350	$	-	$	-	$	1,855,350

Construction in progress

Total non-depreciable cost

Capital assets that are depreciated: Buildings
Improvements other than buildings Furniture, equipment and vehicles

Total depreciable historical cost

Less accumulated depreciation: Buildings
Improvements other than buildings Furniture & Equipment

Total accumulated depreciation

Total capital assets, net

	-

	1,855,350

69,862,587 3,182,173
	5,940,727

	78,985,487

29,180,511 1,268,362
	3,868,761

	34,317,634

$	46,523,203

	1,661,936

	1,661,936

--
	476,371

	476,371

1,674,501 155,547
	466,127

	2,296,175

$	(157,868)

	-

	-

-109,841
	514,700

	624,541

-109,841
	506,041

	615,882

$	(8,659)

	1,661,936

	3,517,286

69,862,587 3,072,332
	5,902,398

	78,837,317

30,855,012 1,314,068
	3,828,847

	35,997,927

$	46,356,676

Depreciation expense for the year ended June 30, 2018, was allocated to specific functions as follows:

General support Instruction Transportation

Total Depreciation

$           27,308 2,073,819
	195,048

$	2,296,175

9.	SHORT-TERM DEBT

Transactions in short-term debt for the year are summarized below:

Maturity

7/21/2017

Interest Rate

1.18%

Beginning Balance

$	473,930

Issued	Redeemed

$	-	$	473,930

Ending Balance

$	-

Interest paid on short term debt for the year ended June 30, 2018 was $5,592.

35

10.	LONG-TERM DEBT

In October 2017, the District partially refunded $4,225,00 of DASNY 2010A serial bonds with an interest rate of 3-5%. The net proceeds were used to purchase DASNY 2017G serial bonds. The securities were deposited into a trust with an escrow agent to provide for all future debt service payments on the refunded bonds. As a result, the bonds are considered to be partially defeased and the liability for those bonds refunded was removed from the District’s financial statements. The refunding decreases total debt service payments for the next five years by $206,975 resulting in an economic gain (difference between the present value of the debt service payments on the old and on the new debt) of $194,460.

Interest on long-term debt for the year was composed of:

Interest paid
Less: amortized premium
Less: interest accrued in the prior year
Plus: amortized amount on deferred refunding Plus: interest accrued in the current year

Total expense

$	 594,143 (190,661)
(69,756) 78,472
	42,799

$	454,997

Long-term liability balances and activity for the year are summarized below:

Government activities Bonds and notes payable:
General obligation debt:

Beginning

Balance	Additions	Reductions

(As restated)

Ending

Balance

Amounts Due Within
One Year

Serial bonds payable                         $       15,835,602      $           4,593,930      $                    6,801,532      $       13,628,000      $         2,593,000 Premium on bonds                                        1,178,600                              634,9                          190,661                 1,622,911                    190,661

Total Bonds and notes

Other liabilities:

Other postemployment benefits Compensated absences
Net pension liability

Total other liabilities

Total long-term liabilities

	17,014,202

48,188,173 2,277,038
	1,781,216

	52,246,427

$	69,260,629

	5,228,902

3,076,470 21,823
	-

	3,098,293

$	8,327,195

	6,992,193

4,314,269 -
	1,501,724

	5,815,993

$	12,808,186

	15,250,911

46,950,374 2,298,861
	279,492

	49,528,727

$	64,779,638

	2,783,661

--
	-

	-

$	2,783,661

36

10.	LONG-TERM DEBT (Continued)

Issue dates, maturities, and interest rates on outstanding debt are as follows:

June 30, 2018 Bond Issue	Issued	Maturity	Interest Rate	Balance

Serial Bonds Serial Bonds Serial Bonds Serial Bonds Serial Bonds
Serial Bonds

8/16                      8/21 6/10                     10/25 11/17                     6/24 6/15                      6/30 3/13                      7/30
7/17	6/30

1.56% 3.00-5.00% 2.00-3.00% 3.00-5.00% 2.00-4.00%
2.93%

$	 255,000 1,820,000 4,115,000 3,450,000 3,530,000
455,000

Statutory Bonds	2/03	01/19	4.90%	               3,000

Total	$ 13,628,000

The following is a summary of the maturity of bonds payable:

Fiscal Year Ending June 30,

2019 2020 2021 2022 2023
2024-2028 2029-2031

Totals

Principal

$	2,593,000 2,600,000 1,455,000 1,365,000 1,425,000 3,250,000
	940,000

$ 13,628,000

Interest

$	447,987 372,549 314,679 255,516 187,903 348,936
	50,529

$	1,978,099

Total

$	3,040,987 2,972,549 1,769,679 1,620,516 1,612,903 3,598,936
	990,529

$ 15,606,099

Payments on bonds and other long-term liabilities are generally made by the general fund.

11.	INTERFUND BALANCES AND ACTIVITY

	Interfund	      	Interfund	

Receivable	Payable	Revenue	Expenditure

General fund Special aid fund School lunch fund
Capital fund

$	2,083,449	$ 22,295
-

-

22,295	$ 420,875
-

1,660,574

-	$	102,373 77,373                                -25,000                                -
-	-

Fiduciary funds

Total governmental activities

	-

$	2,105,744

	2,000

$	2,105,744

	-

$	102,373

	-

$	102,373

Interfund receivables and payables, other than between governmental activities and fiduciary funds, are eliminated on the statement of net position.

The School District typically loans resources between funds for the purpose of mitigating the effects of transient cash flow issues.

All interfund payables are expected to be repaid within one year.

37

12.	PENSION PLANS

New York State Employee Retirement System

The District participates in the New York State and Local Employee’s Retirement System (ERS) also referred to as New York State and Local Retirement System (the System). This is a cost-sharing multiple-employer retirement system, providing retirement benefits as well as death and disability benefits. The net position of the System is held in the New York State Common Retirement Fund (the Fund), established to hold all net assets and record changes in plan net position allocated to the System. System benefits are established under the provisions of the New York Retirement and Social Security Law (NYRSSL). Once an employer elects to participate in the System, 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 District also participates in the Public Employees’ Group Life Insurance Plan (GLIP), which provides death benefits in the form of life insurance. The system 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.

Contributions
The system is noncontributory except for employees who joined the New York State and Local Employees’ Retirement System after July 27th, 1976, who contribute 3 percent of their salary for the first ten years of membership, and employees who joined on or after January 1, 2010 (ERS) who generally contribute 3 percent 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 Systems’ fiscal year ending March 31. Contributions for the current year and two preceding years were equal to 100 percent of the contributions required, and were as follows:

2018	$	392,881 2017	$	377,684 2016	$	351,739

Chapter 260 of the Laws of 2004 of the State of New York allows local employers to bond or amortize a portion of their retirement bill for up to 10 years in accordance with the following schedule:

	 For State fiscal year (SFY) 2004-05, the amount in excess of 7 percent of employees’ covered pensionable salaries, with the first payment of those pensions’ costs not due until the fiscal year succeeding that fiscal year in which the bonding/amortization was instituted.
	 For SFY 2005-06, the amount in excess of 9.5 percent of employees’ covered pensionable salaries.
	For SFY 2007-08, the amount in excess of 10.5 percent of the employee’s covered pensionable salaries.

38

12.	PENSION PLANS (Continued)

New York State Employee Retirement System (Continued)

This law requires all participating employers to make payments on the current basis, while bonding or amortizing existing unpaid amounts relating to the System’s fiscal years ending March 31, 2005 through 2008.

Chapter 57 of the Laws of 2010 of the State of New York allows local employers to amortize a portion of their retirement bill for 10 years in accordance with the following stipulations:

	For state fiscal year 2010-11, the amount in excess of the graded rate of 9.5 percent of employees’ covered pensionable salaries, with the first payment of those pension costs not due until the fiscal year succeeding that fiscal year in which the amortization was instituted.
	 For subsequent State fiscal years, the graded rate will increase or decrease by up to one percent depending on the gap between the increase or decrease in the System’s average rate and the previous graded rate.
	 For subsequent State fiscal years in which the System’s average rates are lower than the graded rates, the employer will be required to pay the graded rate. Any additional contributions made will first be used to pay off existing amortizations, and then any excess will be deposited into a reserve account and will be used to offset future increases in contribution rates.

This law requires participating employers to make payments on the current basis while amortizing existing unpaid amounts relating to the System’s fiscal years when the local employer opts to participate in the program.

All amounts due were remitted in full to the New York Employee Retirement System. No portion of the Districts retirement bill was amortized or bonded as of June 30, 2018.

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2018, the District reported a liability of $279,492 for its proportionate share of the net pension liability. The net pension liability was measured as of March 31, 2018, and the total pension liability used to calculate the net pension liability was determined by the actuarial valuation as of that date. The District’s proportion of the net pension liability was based on a projection of the Districts’ long-term share of contributions to the pension plan relative to the projected contributions of all participating members, actuarially determined.

At June 30, 2018, the District’s proportion was 0.0086599 percent. At June 30, 2017, the District’s proportion was 0.0088955 percent.

39

12.	PENSION PLANS (Continued)

New York State Employee Retirement System (Continued)

For the year ended June 30, 2018, the District recognized pension expense of $369,641. At June 30, 2018, the District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred Outflows of Resources

Deferred Inflows of
Resources

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 the District's and proportionate share of contributions Contributions made subsequent to measurement date

$           99,686 185,326

405,940

88,745
	101,775

$           82,377 -

801,285

11,078
	-

$	881,472	$	894,740

$101,775 reported as deferred outflows of resources related to pensions resulting from the District’s contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the next fiscal year. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Plan’s Year Ended March 31: 2019
2020 2021 2022 2023 Thereafter

$           91,580 67,381
(187,094) (86,910)
-
	-

$	(115,043)

Actuarial Assumptions
The total pension liability at March 31, 2018 was determined by using an actuarial valuation as of April 1, 2017, with update procedures used to roll forward the total pension liability to March 31, 2018. The actuarial valuation used the following actuarial assumptions:

Actuarial cost method Inflation
Salary scale Projected COLAs Decrements

Mortality improvement Investment Rate of Return

Entry age normal 2.50%
3.8 percent indexed by service 1.3% compounded annually
Developed from the Plan's 2015 experience study of the period April 1, 2010 through March 31, 2015
Society of Actuaries Scale MP-2014
7.0% compounded annually, net of investment expenses

40

12.	PENSION PLANS (Continued)

New York State Employee Retirement System (Continued)

The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected return, net of investment expenses and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation.

Best estimates of arithmetic real rates of return for each major asset class included in the target asset allocation as of March 31, 2018 are summarized below:

Asset Type

Domestic Equity International Equity Private Equity
Real Estate
Absolute Return Strategies Opportunistic Portfolio Real Asset
Bonds, Cash & Mortgages Cash
Inflation Indexed Bonds

Target Allocations in %

36.0 % 14.0 10.0 10.0
2.0 3.0 3.0 17.0 1.0
 4.0

Long-Term expected real rate of return in %

4.55 % 6.35 7.75 5.80 4.00 5.89 5.54 1.31
(0.25) 1.50

	100 %

Discount Rate
The discount rate used to calculate the total pension liability was 7%. 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. Based upon the assumptions, the Plan’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.

Sensitivity of the Proportionate Share of the Net Pension Liability to the Discount Rate Assumption
The following presents the District’s proportionate share of the net pension liability calculated using the discount rate of 7%, as well as what the District’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1% lower (6.0%) or 1% higher (8.0%) than the current rate:

Proportionate Share of
Net Pension liability (asset)

1% Decrease (6.0%)

$ 2,114,713

Current Discount (7.0%)

$	279,492

1% Increase (8.0%)

$ (1,273,031)

41

12.	PENSION PLANS (Continued)

New York State Employee Retirement System (Continued)

Pension Plan Fiduciary Net Position
The components of the current-year net pension liability (in 000’s) of the employers as of March 31, 2018, were as follows:

Total pension liability Plan net position

Net pension liability (asset)
ERS net position as a percentage of total pension liability

$ 183,400,590

 (180,173,145)

$	3,227,445 98.24%

New York State Teachers Retirement System

The District participates in the New York State Teachers’ Retirement System (NYSTRS). This is a cost-sharing, multiple employer public employee retirement system. The system offers a wide range of plans and benefits, which are related to years of service and final average salary, vesting of retirement benefits, death, and disability.

The New York State Teachers’ Retirement Board administers NYSTRS. The system provides benefits to plan members and beneficiaries as authorized by the Education Law and the Retirement and Social Security Law of the State of New York. NYSTRS issues a publicly available financial report that contains financial statements and required supplementary information for the system. The report may be obtained by writing to NYSTRS, 10 Corporate Woods Drive, Albany, New York 12211-2395.

Contributions
The System is noncontributory for the employees who joined prior to July 27, 1976. For employees who joined the System after July 27, 1976, and prior to January 1, 2010, employees contribute 3% of their salary, except that employees in the System more than ten years are no longer required to contribute. For employees who joined after January 1, 2010 and prior to April 1, 2012, contributions of 3.5% are paid throughout their active membership.

For employees who joined after April 1, 2012, required contributions of 3.5% of their salary are paid until April 1, 2013 and they then contribute 3% to 6% of their salary throughout their active membership. Pursuant to Article 11 of the Education Law, the New York State Teachers’ Retirement Board establishes rates annually for NYSTRS.

The District is required to contribute at an actuarially determined rate. The District contributions made to the systems were equal to 100% of the contributions required for each year. The required contributions for the current year and two preceding years were:

2018	$	1,641,024 2017                                                                                                 1,806,079 2016                                                                                                 2,319,960

42

12.	PENSION PLANS (Continued)

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

New York State Teachers Retirement System (Continued)

At June 30, 2018, the District reported an asset of $671,612 for its proportionate share of the net pension net pension asset. The net pension asset was measured as of June 30, 2017, and the total pension liability used to calculate the net pension asset was determined by the actuarial valuation as of that date. The District’s proportion of the net pension liability was based on a projection of the Districts’ long-term share of contributions to the pension plan relative to the projected contributions of all participating members, actuarially determined.

At June 30, 2018 the District’s proportion was 0.088358 percent, which was a increase of 0.000091 percent from its proportion measured June 30, 2017.

For the year ended June 30, 2018, the District recognized pension expense of $1,696,346. At June 30, 2018 the District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS

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 the District’s contributions and proportionate share of contributions
Contributions subsequent to the measurement date

Total

Deferred Outflows of Resources

$         552,572 6,833,784

-

42,313
	1,491,435

$	8,920,104

Deferred Inflows of Resources

$        261,854 -

1,581,841

13,656
	-

$	1,857,351

$1,491,435 reported as deferred outflows of resources related to pensions resulting from the District’s contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2018. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

TRS Plan’s Year Ended June 30:

2018 2019 2020 2021 2022 Thereafter
Total

Amount

$         163,252 1,815,843 1,301,673 329,028 1,297,909
           663,613 $      5,571,318

43

12.	PENSION PLANS (Continued)

New York State Teachers Retirement System (Continued)

Actuarial Assumptions
The total pension liability at the June 30, 2017 measurement date was determined by an actuarial valuation as of June 30, 2016, with update procedures used to roll forward the total pension liability to June 30, 2017. This actuarial valuation used the following actuarial assumptions:

Inflation
Projected Salary Increases

Projected COLAs Investment Rate of Return

2.50%
Rates of increase differ on services.
They have been calculated based upon recent NYSTRS Member experience.
Service	Rate 5	4.72%
15	3.46% 25	2.37% 35	1.90%
1.5% compounded annually
7.5% compounded annually, net of pension plan investment expense, including inflation.

Annuitant morality rates are based on plan member experience, with adjustments for mortality improvements based on Society of Actuaries Scale MP 2014 applied on a generational basis. Active member mortality rates are based on plan member experience.

The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009 to June 30, 2014.

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 expect 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.

44

12.	PENSION PLANS (Continued)

New York State Teachers Retirement System (Continued)

Actuarial Assumptions (Continued)

Best estimates of arithmetic real rates of return for each major asset class included in the Systems target asset allocation as of the valuation date of June 30, 2017 (see the discussion of the pension plan’s investment policy) are summarized in the following table:

Asset Type Domestic equities International equities Real Estate
Private equities
Domestic fixed income securities Global fixed income securities High-yield fixed income securities Mortgages
Short-term

Target Allocations in % 35 18 11 8 16 2 1 8 1
100%

Long-Term expected real Rate of return in % 5.9 7.4 4.3 9.0 1.6 1.3 3.9 2.8 0.6

Discount Rate
The discount rate used to measure the total pension liability was 7.25%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from school districts will be made at statutorily required rates, actuarially determined. Based on those assumptions, the NYSTRS’ 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.

Sensitivity of the Proportionate Share of the Net Pension Liability to the Discount Rate Assumption
The following presents the net pension liability (asset) of the school districts calculated using the discount rate of 7.25%, as well as what the District’s net pension liability (asset) would be if it were calculated using a discount rate that is 1-percentage-point lower (6.25%) or 1-percentage-point higher (8.25%) than the current rate:

Proportionate Share of
Net Pension liability (asset)

1% Decrease (6.25%)

$11,569,888

Current Discount (7.25%)

$ (671,612)

1% Increase (8.25%)

$(10,923,261)

45

12.	PENSION PLANS (Continued)

New York State Teachers Retirement System (Continued)

Pension Plan Fiduciary Net Position
The components of the current-year net pension (asset) of the employers as June 30, 2017, were as follows:

Total pension liability

Plan net position

$114,708,261,032

 115,468,360,316

Net pension liability (asset)
NYSTRS net position as a percentage of total pension liability

$	(760,099,284)

100.66%

13.	OTHER POSTEMPLOYMENT BENEFITS OBLIGATION

Plan Description
The District provides postemployment (health insurance, life insurance, etc.) coverage to retired employees in accordance with the provisions of various employment contracts. The benefit levels, employee contributions and employer contributions are governed by the District’s contractual agreements. The District is required to calculate and record an other postemployment benefit (OPEB) obligation at year-end. The net OPEB obligation is basically the cumulative difference between the actuarially required contribution and the actual contributions made.

The District recognizes the cost of providing health insurance annually as expenditures in the funds as payments are made. For the year ended June 30, 2018, the District recognized expenditures of $921,780 for the claims paid for currently enrolled retirees for the self-insurance health plan. There were approximately 500 retirees and beneficiaries receiving benefits under this plan at June 30, 2018.

Funding Policy
As of the date of these financial statements, New York State did not yet have legislation that would enable government entities to establish a qualifying trust for the purpose of funding other postemployment benefits. As such there are no assets accumulated in a trust that meets all of the criteria in GASB Statement No. 75, paragraph 4 to fund this obligation and benefits are paid on a pay as you go basis.

Employees Covered by Benefit Terms
At June 30, 2018, the following employees were covered by the benefit terms:

Inactive employees or beneficiaries receiving benefits	219 Inactive employees entitled to but not yet receiving benefits                               -Active employees                                                                          	289 Total participants                                                                           	508

Total OPEB Liability
The District’s total OPEB liability of $46,950,374 was measured as of June 30, 2018, and was determined by an actuarial valuation as of June 30, 2017.

46

13.	OTHER POSTEMPLOYMENT BENEFITS OBLIGATION (Continued)

Changes in the Total OPEB Liability

Balance at June 30, 2017, as restated

Changes for the Year-Service cost Interest
Changes of benefit terms Changes in assumptions
Differences between expected and actual experience Benefit payments
Net changes

Balance at June 30, 2018

 $ 48,188,173

1,351,333 1,725,137 -
(2,377,287) -
	(1,936,982)

	(1,237,799)

 $46,950,374

Changes of assumptions and other inputs reflect a change in the discount rate from 3.58% in 2017 to 3.87% in 2018.

Actuarial Assumptions and Other Inputs
The total OPEB liability in the June 30, 2018 actuarial valuation was determined using the following actuarial assumptions:

Discount Rate

Inflation

Real wage growth Wage inflation
Salary increases, including wage inflation

Mortality

Annual Rate Increase in Healthcare Costs:

Pre-Medicare

Medicare

3.58% as of July 1, 2017; 3.87% as of June 30, 2018
Rates were based on the Bond Buyer General Obligation 20-year Municipal Bond Index.
2.20%

1.00% 3.20%

10.47% - 3.20%

Rates were based on April 1, 2010 – March 31, 2015 NYSLRS	experience	with	adjustments	for	mortality improvements based on the Society of Actuaries’ Scale MP-2014.
The annual rate of increase in healthcare costs developed based on a review of published National trend survey data in relation to the retiree health plan offerings and updated long-term rates based on the Getzen model.
5.50% for 2018, with an ultimate rate of 3.84% in 2078.

5.50% for 2018, with an ultimate rate of 3.84% in 2078.

47

13.	OTHER POSTEMPLOYMENT BENEFITS OBLIGATION (Continued)

Actuarial Assumptions and Other Inputs (Continued)

Retirement Rates

Retiree Option Election Rates

Proportion Electing Spousal Coverage

Employees who meet the service requirement may typically retire from the District at age 55 or later. The valuation considers the fact that employees may elect to retire at different ages. The retirement rates used in the valuation were developed by the Office of the Actuary of TRS and the Office of the Actuary of ERS, for the valuation of their respective pension liabilities.
For retirees, it is assumed that each will remain in his/her current plan. For actives, it is assumed that 100% of the future retirees will elect to take the District’s coverage in Excellus, BCBS plan.

Male 50%, Female 20%

Sensitivity of the Total OPEB Liability to Changes in the Discount Rate
The following presents the total OPEB liability of the District, as well as what the District’s total OPEB liability would be if it were calculated using a discount rate that is 1 percentage pointlower(2.87%)or1percentage pointhigher (4.87%) than the current discount rate:

1% Decrease (2.87%)

Current Discount (3.87%)

1% Increase (4.87%)

Total OPEB Liability	$38,059,080 $46,950,374	$55,371,871

Sensitivity of the Total OPEB Liability to Changes in the Healthcare Cost Trend Rates The following presents the total OPEB liability of the District, as well as what the District’s total OPEB liability would be if it were calculated using healthcare cost trend rates that are 1 percentage point lower or 1 percentage point higher than the current healthcare cost trend rate:

Healthcare Cost Trend Rate

1% Decrease
(4.50 to 2.84%)

Current Discount
(5.50 to 3.84%)

1% Increase
(6.50 to 4.84%)

Total OPEB Liability	$54,562,280	$46,950,374	$38,556,354

OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
For the year ended June 30, 2018, the District recognized OPEB expense of $2,747,434.

48

13.	OTHER POSTEMPLOYMENT BENEFITS OBLIGATION (Continued)

OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of	Resources Related to OPEB (Continued)

At June 30, 2018, the District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Differences between actual and expected experience
Changes of assumptions Total

Deferred Outflows of Resources

$	-
                       -$                     -

Deferred Inflows of Resources

$		-2,048,251
$	2,048,251

Amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Fiscal Year Ending June 2019 2020
2021 2022

2023

Amount

$         329,036 329,036
329,036 329,036

329,036

Thereafter	           403,071

	$2,048,251

14.	RISK MANAGEMENT

The School District is exposed to various risks of loss related to torts, theft, damage, injuries, errors and omissions, natural disasters, and other risks. These risks are covered by commercial insurance purchased from independent third parties.	Settled claims from these risks have not exceeded commercial insurance coverage for the past three years.

Otsego Northern Catskill BOCES administers the Catskill Area Schools Workers' Compensation Plan (CASWCP) consisting of 24 school districts, including the Oneonta City School District, for Workers' Compensation insurance coverage. Entities joining the plan must remain members for a minimum of one year; a member may withdraw from the plan effective July 1st but must submit a notice of withdrawal no later than April 1st of the previous year (15 months in advance). Plan members are subject to a supplemental assessment in the event of deficiencies. If the plan's assets were to be exhausted, members would be responsible for the plan's liabilities. The plan uses a reinsurance agreement to reduce its exposure to large losses on insured events. Reinsurance permits recovery of a portion of losses from the reinsurer, although it does not discharge the liability of the plan as direct insurer of the risks reinsured.

The School District also participates in the Broome-Tioga Consortium, a non-risk retained public entity risk pool for its employee’s health and accident insurance coverage. The Pool is operated for the benefit of several individual governmental units within the Pool’s geographic area, and is considered a self-sustaining risk pool that will provide all necessary coverage for its members. The Pool obtains independent coverage and the School District has essentially transferred all related risk to the Pool.

49

15.	CONTINGENCIES AND COMMITMENTS

The School District has received grants which are subject to audit by agencies of the state and federal governments. Such audits may result in disallowances and a request for a return of funds. Based on prior audits, the School District’s administration believes disallowances, if any, will be immaterial.

The School District has various commitments with contractors for the completion of capital projects.

The School District has tax certiorari cases pending with certain property owners. While the outcome of these matters is uncertain, the School District intends to vigorously defend its position.

16.	SUBSEQUENT EVENTS

The following event occurred subsequent to the fiscal year ended June 30, 2018:

On July 19, 2018, the District issued a Bond Anticipation Note of $3,000,000 at an interest rate of 2.750% maturing July 19, 2019 to finance the cost of construction to District facilities.

17.	NEW AND UPCOMING PRONOUNCEMENTS

Implemented in the Current Year

The GASB issued Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. Statement No. 75 replaces the requirements of Statements No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions, as amended, and No. 57, OPEB Measurements by Agent Employers and Agent Multiple-Employer Plans, for OPEB. Statement No. 74, Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans, establishes new accounting and financial reporting requirements for OPEB plans. The District adopted the provisions of these Statements for the current year ended June 30, 2018.

Not Yet Implemented

In November 2016, the GASB issued Statement No. 83, Certain Asset Retirement Obligations. This Statement addresses accounting and financial reporting for certain asset retirement obligations (AROs). An ARO is a legally enforceable liability associated with the retirement of a tangible capital asset. A government that has legal obligations to perform future retirement activities related to its tangible capital assets should recognize a liability based on the guidance in this Statement. The Statement establishes criteria for determining the timing and pattern of recognition of a liability and corresponding deferred outflow of resources for asset retirement obligations. The requirements of this Statement are effective for reporting periods beginning after June 15, 2018. Earlier application is encouraged.

In January 2017, the GASB issued Statement No. 84, Fiduciary Activities. The Statement establishes criteria for identifying fiduciary activities of all state and local governments. The requirements of this Statement are effective for reporting periods beginning after December 15, 2018. Earlier application is encouraged.

50

17.	NEW AND UPCOMING PRONOUNCEMENTS (Continued)

In March 2017, the GASB issued Statement No. 85, Omnibus 2017. This Statement addresses practice issues that have been identified during the implementation and application of certain GASB Statements. The Statement addresses a variety of topics including issued related to blending component units, goodwill, fair value measurement and application, and postemployment benefits. The requirements of this Statement are effective for reporting periods beginning after June 15, 2017. Earlier application is encouraged.

In May 2017, the GASB issued Statement No. 86, Certain Debt Extinguishment Issues. The objective of this Statement is to improve consistency in accounting and financial reporting for in-substance defeasance of debt by providing guidance for transactions in which cash and other monetary assets acquired with only existing resources-resources other than the proceeds of refunding debt- are placed in an irrevocable trust for the sole purpose of extinguishing debt. The requirements of this Statement are effective for reporting periods beginning after June 15, 2017. Earlier application is encouraged.

In June 2017, GASB issued Statement No. 87, Leases. The Statement requires recognition of certain lease assets and liabilities for leases previously classified as operating leases. Under this Statement, a lessee is required to recognize a lease liability and an intangible right-to-use asset.	The requirements of this Statement are effective for reporting periods beginning after December 15, 2019. Earlier application is encouraged.

In April 2018, the GASB issued Statement No. 88, Certain Disclosures Related to Debt, Including Direct Borrowings and Direct Placements.	This Statement requires that additional essential information related to debt be disclosed in notes to the financial statements, including unused lines of credit, assets pledged as collateral for the debt and terms specified in debt agreements related to significant events of default with finance-related consequences, significant termination events and significant subjective acceleration clauses. The requirements of this Statement are effective for reporting periods beginning after June 15, 2018. Earlier application is encouraged.

In June 2018, the GASB issued Statement No. 89 Accounting for Interest Costs Incurred before the End of a Construction Period.	This Statement establishes accounting requirements for interest incurred before the end of construction period. The Statement requires that interest costs incurred before the end of a construction period be recognized as an expense in the period in which the cost is incurred for financial statements prepared using the economic resources measurement focus. As a result, interest costs incurred before the end of a construction period will not be included in the cost of a capital asset reported in a business-type activity or enterprise fund.

The District is in the process of assessing the impact of these statements on its future financial statements.

51

REQUIRED SUPPLEMENTARY INFORMATION (UNAUDITED)

ONEONTA CITY SCHOOL DISTRICT

SCHEDULE OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL - GENERAL FUND (UNAUDITED) FOR THE YEAR ENDED JUNE 30, 2018

Original Budget
REVENUE

Final	Actual Budget               (Budgetary Basis)

Final Budget Variance with
Encumbrances	Budgetary Actual

LOCAL SOURCES: Real property taxes Other tax items Charges for services
Use of money and property

$     20,728,563 430,831 405,626 84,103

$	18,412,926	$ 2,654,114
405,627 84,103

18,412,926	$ 2,646,353
508,142 98,064

-        $                      --                      (7,761) -                   102,515 -                     13,961

Sale of property and compensation for loss Miscellaneous

Total local sources

State sources

Medicaid reimbursement

Total revenue

8,500 155,400

21,813,023

15,687,479

	20,000

	37,520,502

11,080 177,545

21,745,395

15,687,479

	20,000

	 37,452,874

26,089                              -414,485                              -

22,106,059	-

15,545,348	-

	148,905	                       -

	37,800,312	                       -

15,009

	 236,940

360,664

(142,131)

	 128,905

	 347,438

(Continued) 52

ONEONTA CITY SCHOOL DISTRICT

SCHEDULE OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL - GENERAL FUND (UNAUDITED) (Continued) FOR THE YEAR ENDED JUNE 30, 2018

Original Budget
EXPENDITURES

Final	Actual
Budget	(Budgetary Basis)	Encumbrances

Variance with Budgetary Actual and Encumbrances

GENERAL SUPPORT: Board of education Central administration Finance
Staff
Central services Special items

16,640 239,887 274,883 192,578 2,487,231 794,143

16,640	$ 239,140 275,630 226,692
2,589,785 834,011

15,303	$ 236,165 271,828 200,460
2,415,082 832,518

-	$	1,337 -                       2,975 -                       3,802 -                     26,232
3,192                   171,511 -                       1,493

Total general support

INSTRUCTION:

Instruction, administration, and improvement Teaching - Regular school
Programs for children with handicapping conditions Occupational education
Teaching - Special school Instructional media
Pupil services

Total instruction

Pupil transportation Employee benefits Debt service - principal Debt service - Interest

Total expenditures

OTHER FINANCING USES

Transfers to other funds

Total expenditures and other uses

NET CHANGE IN FUND BALANCES

4,005,362

1,025,061 9,238,118 5,953,161 962,388 245,446 1,626,565 1,709,555

20,760,294

1,182,260 9,375,741 2,571,532 646,904

38,542,093

136,015

38,678,108

(1,157,606)

4,181,898

1,021,173 9,471,407 5,873,687 962,388 245,446 1,636,793 1,734,491

20,945,385

1,323,713 9,083,902 2,571,532 646,904

38,753,334

136,015

38,889,349

(1,436,475)

3,971,356

991,189 9,219,231 5,631,182 840,714 238,232 1,601,854 1,560,561

20,082,963

1,315,024 8,982,057 2,576,532 599,735

37,527,667

102,373

37,630,040

170,272

3,192

569 34,682 245
-806 816
13,893

51,011

858 ---

55,061

-

55,061

(55,061)

207,350

29,415 217,494 242,260 121,674 6,408 34,123 160,037

811,411

7,831 101,845
(5,000) 47,169

1,170,606

33,642

1,204,248

1,551,686

FUND BALANCE - beginning of year	4,224,292

FUND BALANCE - end of year	$	4,394,564

The accompanying notes are an integral part of these schedules. 53

ONEONTA CITY SCHOOL DISTRICT

SCHEDULE OF CHANGES IN TOTAL OPEB LIABILITY AND RELATED RATIOS (UNAUDITED) FOR THE YEAR ENDED JUNE 30, 2018

Last 10 Fiscal Years (Dollar amounts displayed in thousands)

Total OPEB Liability Service cost
Interest

Changes of benefit terms

Differences between expected and actual experience Changes in assumptions
Benefit payments

Total change in total OPEB liability Total OPEB liability - beginning Total OPEB liability - ending

Covered-employee payroll

Total OPEB liability as a percentage of covered-

employee payroll

2018	2017	2016	2015	2014	2013	2012	2011	2010	2008

$            1,351 1,725
--
(2,377) (1,937) (1,238) 48,188 46,950

$	15,616

300.7%

Notes to schedule:

Changes of assumptions: Changes in assumptions and other inputs reflect the effects of changes in the discount rate each period. The following reflects the discount rate used each period: Discount rate	3.87%	3.58%

Plan assets: No assets are accumulated in a trust that meets all of the criteria of GASB Statement No. 75, paragraph 4 to pay benefits.

The accompanying notes are an integral part of these schedules. 54

ONEONTA CITY SCHOOL DISTRICT

SCHEDULE OF PROPORTIONATE SHARE OF NET PENSION LIABILITY (ASSET) (UNAUDITED) FOR THE YEAR ENDED JUNE 30, 2018

Last 10 Fiscal Years (Dollar amounts displayed in thousands)

NEW YORK STATE EMPLOYEES' RETIREMENT SYSTEM PLAN

Proportion of the net pension liability (asset)

2018

0.8659900%

2017

0.0088955%

2016

0.0085778%

2015	2014	2013	2012	2011	2010	2009

0.0086440%

Proportionate share of the net pension liability (asset) Covered-employee payroll
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 (asset)

$              279.5        $ $           2,560.8        $

10.91%

98.24%

835.8        $ 2,398.6        $

34.85%

94.70%

1,376.5 2,203.8

62.46%

90.68%

$         292.0 $      2,215.4

13.18%

97.95%

Last 10 Fiscal Years (Dollar amounts displayed in thousands)

NEW YORK STATE TEACHERS' RETIREMENT SYSTEM PLAN

Proportion of the net pension liability (asset)

2018

0.0883580%

2017

0.0882670%

2016

0.0881030%

2015	2014	2013	2012	2011	2010	2009

0.0895550%

Proportionate share of the net pension liability (asset)	$	(671.6)	$	945.4	$	(9,151.1)	$     (9,975.8)

Covered-employee payroll

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 (asset)

$	14,484.6	$

-4.64%

100.66%

13,895.8	$

6.80%

99.01%

13,620.5

-67.19%

-110.46%

$ 13,288.6

-75.07%

-111.48%

The accompanying notes are an integral part of these schedules. 55

ONEONTA CITY SCHOOL DISTRICT

SCHEDULE OF CONTRIBUTIONS - PENSION PLANS (UNAUDITED) FOR THE YEAR ENDED JUNE 30, 2018

Last 10 Fiscal Years (Dollar amounts displayed in thousands)

NEW YORK STATE EMPLOYEES' RETIREMENT SYSTEM PLAN

Contractually required contribution

Contributions in relation to the contractually required contribution

2018	2017

$	392.8	$	377.7	$

$	392.8	$	377.7

2016	2015	2014	2013	2012	2011	2010	2009

351.7	$	469.8

351.7	469.8

Contribution deficiency (excess)	$	-	$	-	#     $	-	$	-

Covered-employee payroll

Contributions as a percentage of covered-employee payroll

$	2,560.8	$

15.34%

2,398.6	$

15.75%

2,203.8

15.96%

$ 2,215.4

21.21%

Last 10 Fiscal Years (Dollar amounts displayed in thousands)

NEW YORK STATE TEACHERS' RETIREMENT SYSTEM PLAN

Contractually required contribution

Contributions in relation to the contractually required contribution

2018

$	1,641.0	$

$	1,641.0	$

2017

1,806.1	$

1,806.1	$

2016

1,856.0

1,856.0

2015	2014	2013	2012	2011	2010	2009

$ 2,199.9

$ 2,199.9

Contribution deficiency (excess)	$	-	$	-	$	-	$	-

Covered-employee payroll

Contributions as a percentage of covered-employee payroll

$	14,484.6	$

11.33%

13,895.8	$

13.00%

13,620.5

13.63%

$ 13,228.6

16.63%

The accompanying notes are an integral part of these schedules. 56

SUPPLEMENTARY INFORMATION (UNAUDITED)

ONEONTA CITY SCHOOL DISTRICT

SCHEDULE OF CHANGE FROM ORIGINAL BUDGET TO REVISED BUDGET AND USE OF UNRESERVED FUND BALANCE - GENERAL FUND (UNAUDITED) FOR THE YEAR ENDED JUNE 30, 2018

CHANGE FROM ADOPTED BUDGET TO REVISED BUDGET

Adopted budget	$ 38,678,108

Add: Prior year's encumbrances

Original budget

186,515

38,864,623

Budget revisions:
Donations for specific purchases
Board approved transfer to capital for emergency project

$            22,146 2,580
24,726

Final budget	$ 38,889,349

SECTION 1318 OF REAL PROPERTY TAX LAW LIMIT CALCULATION

2018-19 voter-approved expenditure budget Maximum allowed (4% of 2018-19 budget)

$ 39,442,416
$	1,577,697

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

Total fund balance:	4,394,564

Less:

Restricted fund balance Assigned fund balance:
Appropriated fund balance
Encumbrances included in committed and assigned fund balance

Total adjustments

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

1,160,141

1,225,575

              55,061 2,440,777

$	1,953,787

Actual percentage	5.0%

* Per Office of the State Comptroller's "Fund Balance Reporting and Governmental Fund Type Definitions", Updated April 2011 (Originally Issued November 2010), the portion of [General Fund] fund balance subject to Section 1318 of the Real Property Tax Law is: unrestricted fund balance (i.e., the total of the committed, assigned, and unassigned classifications), minus appropriated fund balance, amounts reserved for insurance recovery, amounts reserved for tax reduction, and encumbrances included in committed and assigned fund balance.

The accompanying notes are an integral part of these schedules. 57

ONEONTA CITY SCHOOL DISTRICT

SCHEDULE OF PROJECT EXPENDITURES -CAPITAL PROJECTS FUND (UNAUDITED) FOR THE YEAR ENDED JUNE 30, 2018

Original Appropriation

PROJECT TITLE

Revised Appropriation

Expenditures Prior	Current
Years	Year	Total

Unexpended Balance

District Wide Capital Project - 2018 Voice Over Internet Emergency - 2017
Pool Renovation - 2015

$       4,120,000 185,000
1,450,000

$	4,120,000	$ 185,000
661,534

-168,656
659,234

$       1,665,067 16,344
2,874

$       1,665,067 185,000
662,108

2,454,933 -
(574)

Total	$	5,755,000	$	4,966,534	$	827,890	$	1,684,285	$	2,512,175	$	2,454,359

The accompanying notes are an integral part of these schedules. 58

ONEONTA CITY SCHOOL DISTRICT

SCHEDULE OF NET INVESTMENT IN CAPITAL ASSETS (UNAUDITED) FOR THE YEAR ENDED JUNE 30, 2018

Capital assets, net	$ 46,356,676

Deduct:

Unamortized bond premium
Short-term portion of bonds payable Long-term portion of bonds payable

1,622,911 2,593,000
11,035,000	15,250,911

Net Investment in capital assets	$ 31,105,765

The accompanying notes are an integral part of these schedules. 59

REQUIRED REPORT

INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

September 27, 2018

To the Board of Education and Superintendent of Oneonta City School District:

We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund and the aggregate remaining fund information of the Oneonta City School District (District), as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements and have issued our report thereon dated September 27, 2018.

Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the District’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the District's internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis.	A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

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Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

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INDEPENDENT	AUDITOR’S	REPORT	ON	INTERNAL	CONTROL	OVER	FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS (Continued)

Compliance and Other Matters
As part of obtaining reasonable assurance about whether District’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that is required to be reported under Government Auditing Standards.

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the District’s internal control over financial reporting or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control over financial reporting and compliance. Accordingly, this communication is not suitable for any other purpose.

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