North East Independent School District San Antonio, Texas ...North East Independent School District...

North East Independent School District San Antonio, Texas

Comprehensive Annual Financial Report

Year Ended June 30, 2012

Report Issued by the Department of

Finance and Accounting Services

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North East Independent School District Comprehensive Annual Financial Report

Finance and Accounting Team:

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

Michelle Ferrara, Senior Director of Accounting Services

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

Brian Moy, Senior Director of Budgets and Financial Analysis

Susie Lackorn, CPA, Comptroller for Business Services and Operations

Veronica Binder, Special Revenue Accounting Manager

Lori Ganci, Comptroller for Instruction and Technology Services

Dee Parchman, CPA, CTSBO, Comptroller for Campus Support and Human Resources

Nancy Bomer, Senior Accountant for Construction and Capital Assets

Shanna Toborg, District Treasurer

Jeff Coats, Senior Accounting Manager

Chana Floyd, Senior Accountant

Janie Villarreal, Senior Accounting Manager

Emma Jackson, CPP, Payroll Manager

Internal Audit:

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

Page Exhibit INTRODUCTORY SECTION Letter of Transmittal v GFOA Distinguished Budget Presentation Award xi GFOA Certificate of Achievement xii List of Elected Officials and Administrators xiii Certificate of Board xiv Organizational Chart xv FINANCIAL SECTION Independent Auditors’ Report 1 Management’s Discussion and Analysis 3 Basic Financial Statements: Government-Wide Financial Statements: Statement of Net Assets 21 A – 1 Statement of Activities 22 B – 1 Fund Financial Statements: Balance Sheet – Governmental Funds 24 C – 1 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets 26 C – 2 Statement of Revenues, Expenditures, and Changes in Fund Balance – Governmental Funds 28 C – 3 Reconciliation of the Governmental Funds Statement of Revenues

Expenditures, and Changes in Fund Balances to the Statement of Activities 30 C – 4 Statement of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – General Fund 31 C – 5 Statement of Net Assets – Proprietary Funds 32 D – 1 Statement of Revenues, Expenses, and Changes in Fund Net Assets – Proprietary Funds 33 D – 2 Statement of Cash Flows – Proprietary Funds 34 D – 3 Statement of Fiduciary Net Assets – Fiduciary Funds 36 E – 1 Statement of Changes in Fiduciary Net Assets 37 E – 2 Notes to the Financial Statements 39

SUPPLEMENTARY INFORMATION Combining and Individual Fund Statements and Schedules: Nonmajor Governmental Funds – Fund Descriptions 87

Combining Balance Sheet – Nonmajor Governmental Funds 98 H – 1 Combining Statement of Revenues, Expenditures, and Changes In Fund Balances – Nonmajor Governmental Funds 106 H – 2 Internal Service Funds – Fund Descriptions 115

Page Exhibit Combining Statement of Net Assets – Internal Service Funds 118 H – 3 Combining Statement of Revenues, Expenses, and Changes In Fund Net Assets – Internal Service Funds 120 H – 4 Combining Statement of Cash Flows – Internal Service Funds 122 H – 5 Enterprise Funds – Fund Descriptions 127 Combining Statement of Net Assets – Nonmajor Enterprise Funds 128 H – 6 Combining Statement of Revenues, Expenses, and Changes In Fund Net Assets – Nonmajor Enterprise Funds 130 H – 7 Combining Statement of Cash Flows – Nonmajor Enterprise Funds 132 H – 8 Agency Funds – Fund Descriptions 136 Combining Statement of Changes in Assets and Liabilities – All Agency Funds 137 H – 9

Capital Assets Used in the Operation of Governmental Funds: Comparative Schedule by Source 140 Schedule by Function and Activity 141 Schedule of Changes by Function 142 Schedules Required by the Texas Education Agency: Schedule of Delinquent Taxes Receivable 144 J – 1 Schedule of Expenditures for Computation of Indirect Cost for 2012-2013 - General and Special Revenue Funds 146 J – 2 Fund Balance and Cash Flow Calculation Worksheet – General Fund 147 J – 3 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – National Breakfast and Lunch Program Fund 148 J – 4 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – Debt Service Fund 149 J – 5 STATISTICAL SECTION (unaudited) Statistical Section Overview 151 Financial Trend Information: Government –Wide Information Net Assets by Component – Last Ten Years 154 Governmental Activities Revenues and Expenses – Last Ten Years 156 Business-Type Activities Revenues and Expenses – Last Ten Years 158 General Revenues and Changes in Net Assets – Last Ten Years 160 Fund Balances, Governmental Funds – Last Ten Years 162 Governmental Fund Revenues – Last Ten Years 164 Governmental Fund Revenue as a Percentage of Total Revenue – Last Ten Years 166 Governmental Fund Expenditures by Function – Last Ten Years 168 Governmental Fund Expenditures by Function as a Percentage of Total Expenditures – Last Ten Years 170

Page Exhibit General Fund Other Sources, Uses, and Changes in Fund Balance - Last Ten Years 172 General Fund Revenues per ADA – Last Ten Years 174 General Fund Expenditures per ADA – Last Ten Years 176 Revenue Capacity Information Assessed and Actual Value of Taxable Property – Last Ten Years 180 Direct and Overlapping Property Tax Rates – Last Ten Years 182 Property Tax Levies and Collections – Last Ten Years 184 Principal Property Taxpayers – Current Year and Nine Years Prior 185 Allocation of Tax Rates and Levies – Last Ten Years 186 Debt Capacity Information Outstanding Debt by Type – Last Ten Years 188 Direct and Overlapping Debt as of June 30, 2012 189 Debt Margin Information – Last Ten Years 190 Debt to Net Assessed Valuation – Last Ten Years 192 Bonded Debt to Operating Expenditures – Last Ten Years 194 Outstanding Debt by Issuance Date 195 Demographic and Economic Information Demographic and Economic Information – Last Ten Years 198 Student Demographic Information – Last Ten Years 199 Principal Employers – Current Year 200 Commercial and Residential Construction - Last Ten Years 201 Operating Information Employees by Full Time Equivalent by Job Function – Last Ten Years 204 Teacher Salary Comparison – Last Ten Years 206 Operating Statistics – Last Ten Years 207 Fidelity Bonds – Current Year 208 School Building Information – Last Ten Years 210 FEDERAL AWARDS SECTION Independent Auditors’ Report on Internal Control Over Financial Reporting And on Compliance Based on an Audit of Financial Statements Performed in Accordance With Government Auditing Standards 213 Independent Auditors’ Report on Compliance With Requirements Applicable to Each Major Program and Internal Control Over Compliance in Accordance With OMB Circular A-133 215 Schedule of Findings and Questioned Costs 217 Summary Schedule of Prior Audit Findings 219 Schedule of Expenditures of Federal Awards 220 K – 1 Notes to Schedule of Expenditures of Federal Awards 223

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November 12, 2012 Mrs. Susan Galindo, President, Board of Trustees, and Patrons of the North East Independent School District Dear Mrs. Galindo, Board of Trustees and Patrons: Management hereby submits the Comprehensive Annual Financial Report (“CAFR”) for the fiscal year ended June 30, 2012. The North East Independent School District’s (the “District”) Finance and Accounting Services Department prepared the CAFR in accordance with generally accepted accounting principles (GAAP). The CAFR is management’s report of financial operations to the Board of Trustees (the “Board”), taxpayers, grantor agencies, employees, the Texas Education Agency, and other interested parties. The financial statements in this report provide an overview of the District’s operation and financial position as a whole and of its individual funds. Responsibility for the accuracy and completeness of the financial statements and fairness of the presentation, including all disclosures, rests with the District. We believe the data, as presented, is accurate in all material respects. The Texas Education Agency (TEA) requires all school districts publish within 150 days of the close of each fiscal year a complete set of financial statements presented in conformity with GAAP and audited in accordance with generally accepted auditing standards (GAAS) by a firm of licensed certified public accountants. Management’s Discussion and Analysis (MD&A) is a required narrative introduction, overview, and analysis of the basic financial statements and should be read in conjunction with this letter of transmittal. The District’s MD&A can be found immediately following the report of the independent auditors. DISTRICT PROFILE The District provides a full range of educational services appropriate to grade levels Pre-K through 12. These include regular and enriched academic education, special education for students with disabilities, gifted and talented classes and many individualized programs, such as specialized instruction for at-risk students and those with limited English proficiency. These

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

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basic programs are supplemented by a wide variety of offerings in career and technology, fine arts, and athletics. The District encompasses approximately 140 square miles in north and northeast Bexar County. Founded in 1949, the District has operated as an independent school district since 1955. The District is one of the 10 largest districts in the State of Texas with a projected enrollment of more than 68,100 students for the 2012-2013 school year. The District is an urban-suburban community, lying within the boundaries of San Antonio and encompassing several smaller municipalities. All campuses are fully accredited by the TEA. The District tailors its instructional programs to enrich and expand student learning and exposure to the tenets of responsible citizenship. District leaders believe this philosophy is instrumental in keeping the completion rate high (94%) and the District’s number of college-bound students high. The Board constitutes the governing body elected from seven single-member districts and sets the tone for instruction and service to students and patrons with its mission statement and goals. Internal and Budgetary Controls The District has established a comprehensive internal control framework designed both to protect the District’s assets from loss, theft or misuse and to compile sufficiently reliable information for the preparation of the District’s financial statements in conformity with GAAP. Internal controls are designed to provide management with reasonable, but not absolute, assurance assets are safeguarded against loss from unauthorized use or disposition and those transactions are executed in accordance with management’s authorization and recorded properly. The concept of reasonable assurance recognizes the cost of a control should not exceed the benefits likely to be derived, and the evaluation of costs and benefits requires estimates and judgments by management. As a recipient of federal, state and local grants, the District is also responsible for an adequate internal control structure that ensures compliance with applicable laws and regulations related to the grants. All funded grants are subject to testing as part of the District’s Single Audit as mandated by the Office of Management and Budget Circular A-133. The results of the District’s Single Audit for the fiscal year ended June 30, 2012, provided no instances of material weaknesses in the internal control structure or significant violations of applicable laws and regulations. The report may be viewed in the Federal Awards section of the CAFR. Budgetary controls are established in accordance with TEA regulations and District policy for all managers with line-item responsibility. TEA regulations set the level of budgetary control at the functional expenditure level. The Board authorized the administration, through resolution, to provide budgetary transfers when there is no impact on the fund balance. The Board must approve all budget amendments impacting fund balance of the General, Debt Service and National Breakfast and Lunch Program Funds. The District utilizes a line-item budget of proposed expenditures and the means of financing them. The emphasis of the budget process is to identify the activities requiring resources and to rank those activities according to the needs of the entire District. Administrators have the responsibility to develop and manage their own

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

The District received a rating of Superior on the Schools Financial Integrity Rating System of Texas.

No academic accountability ratings were issued by the TEA for academic year 2011-2012. In 2010-2011 the District was identified as a Recognized school district for the fourth year in a row, making it one of the largest districts in the state to receive this rating. For 2010-2011, 16 campuses were rated as Exemplary, 24 schools were rated as Recognized, and 25 schools were rated Academically Acceptable. No campuses in the district received a rating of Academically Unacceptable.

Beginning in spring 2012, the State of Texas Assessments of Academic Readiness

(STAAR) replaced the Texas Assessment of Knowledge and Skills (TAKS). At high school, 9th grade-specific assessments were replaced with end-of-course (EOC) assessments. The District’s passing rates on the STAAR EOC for English I Writing was 12 percentage points above the average performance in the state. English I Reading and World Geography were nine percentage points higher, and Algebra I and Biology were six points higher. STAAR was also administered to students in third through eighth grade to assess students’ attainment in reading writing, math, science, and social skills required under Texas education standards. Performance standards for these tests will be released by the TEA January 2013.

The Children at Risk organization announced its top schools in the Greater San Antonio

area. Children at Risk researchers based their methodology on 14 measures of performance to evaluate how well San Antonio public schools are preparing students for post-secondary success. Key measures included performance on TAKS, graduation rate, participation in advanced coursework, and performance on college entrance exams. District schools were among the highest in the rankings with the International School of the Americas, Reagan, and Churchill ranked second, sixth, and eighth, respectively, among high schools. Bush and Lopez ranked fourth and fifth, respectively, in the top ranked middle schools. Roan Forest, Wilderness Oak and Hardy Oak ranked first, third and fourth, respectively, in the elementary school category. In addition, Lee High School was listed in the top three most improved high schools in the Greater San Antonio area.

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Roan Forest Elementary made the Texas Business and Education Coalition (TBEC) Honor Roll for academic year 2010-2011. The TBEC Honor Roll award is the most prestigious award for sustained, academic excellence in Texas. This award recognizes schools that have demonstrated three years of consistent, high performance in all subject areas compared to other schools with similar student populations. Less than four percent of all Texas public schools earn this award, and TBEC Honor Roll schools have the highest percentage of students performing at the State’s most rigorous standard of “Commended” in every subject.

ECONOMIC CONDITION AND OUTLOOK Education in the State of Texas is funded through two main sources of revenue: local property taxes and State aid that is based on the number of students in the District, the type of instructional services provided, and the school district’s property wealth and tax collection efforts. Total revenue has been set at a targeted amount per student. Each legislative biennium, the targeted amount per student may be revised to account for changes in the cost of educating students. Property tax revenue can be increased by increasing the property tax rate or by an increase in valuation of property within the District. Any change in local property tax revenue received due to growth in property value is offset by a reduction in State aid that would be received. The property tax rate for school district maintenance and operations (M&O) is capped at a maximum $1.04 per hundred dollars of valuation without voter approval. The District is taxing at the maximum tax rate without receiving approval from the voters. Decreases in local M&O property tax revenues increase the amount of State aid that will be received under the “hold-harmless” provisions of the funding formula. The increase or decrease in property tax revenue triggers a corresponding change in State aid to return the total revenue received for the two primary sources of funding to the target revenue amount. Property values for the District are approximately the same as in each of the four prior years as economic growth in the area has stagnated. The local economy is showing signs of improvement as the unemployment rate dropped to 6.7% in August 2012, down from 7.8% in August 2011. The housing market is also showing a 9% increase in sales and a 6% increase in new home construction for 2012 as compared to the same time period last year. The State of Texas is experiencing similar good news as the economy picks up state-wide. The improving economy has generated more tax revenue for the State than was predicted in the last legislative biennium. In the past several years, the State has cut its funding of education. In fiscal years 2009 through 2012, the State used Federal funding from the American Reinvestment and Recovery Act (ARRA) to supplant State funding. Additionally, the State faced serious economic issues in the last legislative session and reduced its funding of education by $4 billion for fiscal years 2011-2012 and 2012-2013.

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The District’s funding from the State declined $28.3 million for 2011-12 and $42.0 million for fiscal 2012-13, compared to the funding the District would have received under prior school funding formulas. Hopefully, the improving economy will lead to restoration of educational funding in Texas. The legislature meets in January 2013 to set its budget for the following two years. Long-Term Financial Planning The District recognized the potential for funding shortfalls several years ago and implemented an austerity program to reduce expenditures and increase operational efficiencies. The District is in the 4th year of its austerity program which allowed it to increase fund balance in the General Fund $27.1 million in fiscal year 2011-2012. Fund balance in the General Fund is budgeted to decrease $17.2 million during fiscal year 2012-2013 due to the decrease in funding from the State. The fund balance increase in prior years will enable the District to compensate for the reduced State funding and meet the challenge of possible future cuts in funding when the Legislature reconvenes in 2013.

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

It is the responsibility of the Finance and Accounting Services Department to oversee the financial planning, tracking and accounting for the finances of the District in serving the community and its students. The Superintendent’s Office and Executive Staff oversee and coordinate all the elements involved in the strategic and financial planning process for the District on a long-term basis each fiscal year. AWARDS AND ACKNOWLEDGMENTS Certificate of Achievement for Excellence in Financial Reporting The Government Finance Officers Association (GFOA) of the United States and Canada awarded a Certificate of Achievement for Excellence in Financial Reporting to the District for its Comprehensive Annual Financial Report for the year ended June 30, 2011.

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In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report whose contents conform to program standards. Such reports must satisfy both GAAP and applicable legal requirements. Distinguished Budget Presentation Award The GFOA also presented a Distinguished Budget Presentation Award to the District for its Official Budget Book for the fiscal year beginning July 1, 2011. The Budget Awards Program encourages governments to prepare budget documents of the highest quality to meet the needs of decision-makers and citizens. These awards are valid for a period of one year only. We believe our current reports continue to conform to the Certificate of Achievement Program requirements, and we will once again submit them to the GFOA. Acknowledgments The preparation of this report on a timely basis involves the entire staff of the Finance and Accounting Services Department, including the Offices of Accounting Services and Payroll, Budget and Financial Analysis, Grant Administration and Financial Control, Procurement and eCommerce, and Risk Management and Benefits. We also want to express our appreciation to the bookkeepers and administrative assistants for their contributions to the process. We are grateful for everyone’s assistance in making this system work smoothly and efficiently. Certainly we also owe a debt of gratitude to Management Information Services for the help they provide in running financial reports and managing our databases. We thank our independent auditor Garza/Gonzalez & Associates, whose professional competence and leadership assisted us in developing this award-winning report.

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

Business Services/ Chief Financial Officer

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North East Independent School District

List of Elected Officials and Administrators

Board of Trustees

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

Administrators Dr. Brian Gottardy Superintendent of Schools Dr. Mark Scheffler Associate Superintendent for Campus Support and

Human Resources Janna Hawkins Associate Superintendent for Instruction and

Technology Services/ Chief Instructional Officer

Ronald Clary Associate Superintendent

for Operations Dan Villarreal, CPA Associate Superintendent for

Business Services/ Chief Financial Officer

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

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

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

June 30, 2012, at a meeting of the Board of School Trustees of such school district on the

12th day of November, 2012.

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


Organization Chart

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Management’s Discussion and Analysis


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(Unaudited) In this section of the Comprehensive Annual Financial Report, North East Independent School District (the District) discusses and analyzes its financial performance for the year ended June 30, 2012. Please read this section in conjunction with the transmittal letter, the independent auditors' report, and the District's Basic Financial Statements.

FINANCIAL HIGHLIGHTS

Net assets government-wide totaled $238.3 million as of June 30, 2012. This was an increase of $18.0 million from the previous year and was due to cost cutting measures the District has implemented. The District’s long term liabilities decreased as principal payments on bonded debt decreased the amount outstanding. Also, the District’s investment in capital assets increased as the District continued to renovate and construct new buildings as part of its bond program.

The District’s governmental expenses decreased by approximately 4.0% over the prior year to $661.3 million. The decrease in operating expenses mainly relates to the decreased operational costs as the District reduced payroll costs by not filling open positions and reduced spending in other areas. The decreases in spending were partially offset by increases in costs in utilities, fuel and health insurance.

The General Fund ended the year with a fund balance of $116.8 million, which is $27.1 million more than the previous year-end. The unassigned portion of fund balance increased by $26.9 million to $114.6 million. The fund balance amount available for operations is equal to approximately three and one-tenth months of daily operations. This increase in fund balance was primarily due to cost cutting measures implemented by the District intended to offset revenue reductions from the State of Texas.




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




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The Statement of Net Assets and the Statement of Activities The primary purpose of the government-wide financial statements (the Statement of Net Assets and the Statement of Activities) is to show positive or negative changes in the District’s financial condition as a result of this fiscal year's activities. The Statement of Net Assets includes all District assets and liabilities at the end of the year while the Statement of Activities includes all revenues and expenses generated by the District's operations for the fiscal year. These statements reflect private sector accounting practices based on full accrual reporting for revenues and expenses. The District's revenues are divided as follows: (1) program revenues provided by outside parties who share the costs of some programs, such as tuition from students outside the District or U.S. Department of Education grants to assist low-income children or those with disabilities; and (2) general revenues provided by local taxpayers or the Texas Education Agency’s (TEA) State foundation program. All District assets are reported whether they serve the current year or future years. Liabilities are considered regardless of whether they must be paid in the current or future years. The District's net assets (the difference between assets and liabilities) provide one measure of the District's financial health, or financial position. Over time, increases or decreases in the District's net assets are one indicator of whether its financial health is improving or deteriorating. To fully assess the overall health of the District, one should also consider non-financial factors, such as changes in the District’s average daily attendance, changes in its property tax base, the condition of the District’s facilities, as well as the District’s academic rating. During fiscal year 2011-2012, the District experienced an increase in government-wide net assets, while average daily attendance increased and the District’s property tax base remains at approximately the same as in the prior year. The tax rate for the District’s operations remained at $1.04 per hundred dollars of valuation for fiscal year 2011-2012 which is the same rate for the past four fiscal years. Under the current funding system in Texas, the District can earn up to $5,705 in combined local Maintenance & Operations (M&O) tax revenue (at a $1.00 tax rate per $100 of property value) and State formula revenue per weighted average daily attendance (WADA) as part of a target revenue system established by the State. Changes in M&O tax revenue will be offset by changes in funding from State entitlements; any revenue above the target revenue will have to come from increases in grants or fees for programs and services. The Texas legislature did provide districts an opportunity to increase M&O tax revenue outside of the target revenue by asking taxpayers to increase the tax rate up to a maximum of $1.17 per hundred dollars of valuation. In addition, total revenues will increase as WADA increases.




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The District’s growth has necessitated the renovation of existing facilities and construction of additional facilities. The need for additional or improved facilities is continually reassessed to ensure that our students are best served. The growth is evidenced by the increases in capital assets. In the Statement of Net Assets and the Statement of Activities, the District’s operations are categorized into two types of activities:

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

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

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

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

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




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

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

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

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

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




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GOVERNMENT-WIDE FINANCIAL ANALYSIS This analysis focuses on Governmental Activities Net Assets (Table I). Net assets attributable to the District's governmental activities are reported at $223.4 million as of June 30, 2012. This is an increase of $16.8 million from the prior year. The District’s decrease in its long-term debt payable and a decrease in amounts due to vendors, employees, and in construction related payables was the main reason for this increase in net assets. Current assets decreased as cash and investments were used to pay vendors and employees while capital assets increased from the prior year due to continued construction in the bond program. The District capitalized $61.8 million in expenditures during the fiscal year, with the majority of that amount being capitalized as buildings and improvements. Construction for the 2007A Series bonds are nearing completion progressing with two schools scheduled to open in December 2012. Overall, the District’s investment in capital assets to meet its infrastructure needs represents 76.8% of the total assets. The remaining 23.2% is comprised mainly of cash, cash equivalents and investment balances (11.6%). The amount of bond proceeds invested for future construction totals $19.5 million. Debt payable to bond holders represents the District’s major liabilities. The total bond debt represents 92.1% of the District’s total liability to outside interests. The remaining amount is comprised of amounts owed to vendors, employees, and for actuarially determined liabilities related to the District’s self funded insurance liabilities. The District’s investment in capital assets net of related debt increased $14.3 million as the growth in capital assets is offset by related debt and the accumulated depreciation/amortization on those assets.




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Governmental Activities 2012 2011 Change

Current and Other Assets $ 376,091.0 $ 421,430.2 $ (45,339.2) -10.8 %Capital Assets 1,245,037.8 1,232,412.6 12,625.2 1.0 % Total Assets 1,621,128.8 1,653,842.8 (32,714.0) -2.0 %

Other Liabilities 109,725.7 112,028.3 (2,302.6) -2.1 %Long Term Liabilities 1,287,955.0 1,335,198.5 (47,243.5) -3.5 % Total Liabilities 1,397,680.7 1,447,226.8 (49,546.1) -3.4 %

Net Assets:Invested in Capital Assets,

Net of Related Debt 9,838.5 (4,823.2) 14,661.7 -304.0 %Restricted 115,592.7 152,266.6 (36,673.9) -24.1 %Unrestricted 98,016.9 59,172.6 38,844.3 65.6 %Governmental Net Assets $ 223,448.1 $ 206,616.0 $ 16,832.1 8.1 %

Business-Type ActivitiesCurrent and Other Assets $ 5,133.6 $ 3,927.5 $ 1,206.1 30.7 %Capital Assets 9,916.4 10,308.0 (391.6) -3.8 % Total Assets 15,050.0 14,235.5 814.5 5.7 %

Other Liabilities 184.1 576.9 (392.8) -68.1 % Total Liabilities 184.1 576.9 (392.8) -68.1 %

Net Assets:Invested in Capital Assets 9,916.4 10,308.0 (391.6) -3.8 %Unrestricted 4,949.5 3,350.6 1,598.9 47.7 %Business-Type Net Assets $ 14,865.9 $ 13,658.6 $ 1,207.3 8.8 %

Government-Wide TotalsCurrent and Other Assets $ 381,224.6 $ 425,357.7 $ (44,133.1) -10.4 %Capital Assets 1,254,954.2 1,242,720.6 12,233.6 1.0 % Total Assets 1,636,178.8 1,668,078.3 (31,899.5) -1.9 %

Other Liabilities 109,909.8 112,605.2 (2,695.4) -2.4 %Long Term Liabilities 1,287,955.0 1,335,198.5 (47,243.5) -3.5 % Total Liabilities 1,397,864.8 1,447,803.7 (49,938.9) -3.4 %

Net Assets:Invested in Capital Assets,

Net of Related Debt 19,754.9 5,484.8 14,270.1 260.2 %Restricted 115,592.7 152,266.6 (36,673.9) -24.1 %Unrestricted 102,966.4 62,523.2 40,443.2 64.7 %Government-Wide Net Assets $ 238,314.0 $ 220,274.6 $ 18,039.4 8.2 %

Table INET ASSETS

(In Thousands)

Percent Change




10

GOVERNMENTAL ACTIVITIES FINANCIAL ANALYSIS Changes in Governmental Activities Net Assets are presented in Table II. The District's Governmental Activities revenues were $678.1 million, a decrease of 1.3 percent from the prior year. The District’s two main sources of revenue are aid from the State and local property tax revenues. These two sources comprise approximately 80% of government-wide revenue as evidenced in Figure A-1 below. The main cause of the decrease is due to decreased funding under the American Recovery and Reinvestment Act (ARRA). When ARRA funds were awarded for fiscal years 2009-2010 through 2010-2012, State Foundation School Program revenue was decreased by an equal amount. Fiscal year 2011-2012 was the last year that funding was available under ARRA and the majority of funding from ARRA had been expended in prior years, but Foundation revenue was not restored to prior funding levels to offset the decrease.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Figure A-1 Governmental Activities Revenues by Source

Other

Grants

State Aid

Taxes




11

Despite an increase in students served by the District, the amounts received from the State decreased ($2.6 million) from the prior year, which was the result of the Texas Legislature’s decision to cut education funding to balance the State budget. Had the State restored funding that was reduced in 2009 when the ARRA funds were awarded, the District would have received an additional $28 million in State funding for fiscal year 2011-2012. Investment earnings also increased slightly ($0.8 million). These earnings are affected by various accounting adjustments such as arbitrage and fair market value adjustments. The actual cash received for interest decreased $4.7 million as the District had less to invest as it spent its funds in the Capital Projects fund on construction and renovation projects. The expenses for governmental activities totaled $661.3 million, a decrease of $27.2 million over the prior year. Reductions in payroll related expense is the main cause as the District reduced its workforce by not filling open positions whenever possible. These cost savings measures were part of the District’s austerity plan to reduce costs in anticipation of reduced funding from the State for the current and future fiscal years. The decrease in debt service expenditures is attributable to decreased interest due on bonds issued in prior years. Principal payments totaling $74.0 million over the past two years have reduced the principal on which the interest is based.




12

Total Total2012 2011

Program Revenues: Charges for Services $ 22,783.9 $ 22,628.7 $ 155.2 0.7 % Operating Grants and Contributions 93,390.0 102,842.0 (9,452.0) -9.2 %General Revenues:

Property Taxes General 378,860.1 378,098.8 761.3 0.2 %State Aid 169,075.4 171,635.7 (2,560.3) -1.5 %Grants & Contributions not Restricted 7,146.5 5,308.9 1,837.6 34.6 %Investment Earnings 3,008.2 2,210.1 798.1 36.1 %Miscellaneous 3,865.7 4,042.9 (177.2) -4.4 % Total Revenues 678,129.8 686,767.1 (8,637.3) -1.3 %

Expenses: Instruction, Media and Curriculum 389,220.8 406,103.9 (16,883.1) -4.2 % Instructional and School Leadership 37,532.7 40,199.0 (2,666.3) -6.6 % Student Support 96,552.5 97,372.0 (819.5) -0.8 % General Administration 10,239.9 11,020.5 (780.6) -7.1 % Plant Maintenance, Security and Data Processing 63,145.1 69,629.2 (6,484.1) -9.3 % Community Services 2,490.5 575.5 1,915.0 332.8 % Debt Services 59,725.5 60,916.6 (1,191.1) -2.0 % Intergovernmental Charges 2,438.4 2,732.5 (294.1) -10.8 %

Total Expenses 661,345.4 688,549.2 (27,203.8) -4.0 %

Increase or (Decrease) in Net Assets Before Transfers 16,784.4 (1,782.1) 18,566.5 1,041.8 %

Transfers In 47.7 77.7 (30.0) -38.6 %

Change in Net Assets 16,832.1 (1,704.4) 18,536.5 1,087.6 %

Beginning Net Assets 206,616.0 210,345.5 (3,729.5) -1.8 %

Prior Period Adjustment - (2,025.1) 2,025.1 -100.0 %

Ending Net Assets $ 223,448.1 $ 206,616.0 $ 16,832.1 8.1 %

Change in Amount

Table IICHANGES IN GOVERNMENTAL ACTIVITIES NET ASSETS

(In Thousands)

PercentChange




13

BUSINESS-TYPE ACTIVITIES FINANCIAL ANALYSIS Net assets attributable to business-type activities increased to $14.9 million (Table III). There are five Enterprise Funds working to support the school district and the needs of its community. Community Education is by far the best performer, generating $7.7 million in revenue even as the District strives to offer affordable programs to the community. The Property Management Fund had a decrease in revenue as a lessee entered bankruptcy and terminated its lease of a District warehouse and billing rates for utilities were decreased to lessees of District facilities for various meetings and events held by the lessees.

Total Total2012 2011

Program Revenues: Charges for Services

Property Management $ 618.2 $ 962.3 $ (344.1) (35.76) %Uniform Rentals 63.0 72.2 (9.2) (12.7) %Community Education 7,663.3 7,353.1 310.2 4.2 %Preschool Program for Children

with Disabilities 466.3 330.0 136.3 41.3 %NEAT 697.5 719.1 (21.6) (3.0) %

Total Program Revenues 9,508.3 9,436.7 71.6 0.8 % Expenses:

Property Management 763.7 789.2 (25.5) (3.2) %Uniform Rentals 24.2 41.6 (17.4) (41.8) %Community Education 6,465.7 6,519.6 (53.9) (0.8) %Preschool Program for Children

with Disabilities 425.3 308.3 117.0 38.0 %NEAT 574.3 654.5 (80.2) (12.3) %Total Expenses 8,253.2 8,313.2 (60.0) (0.7) %

Increase or (Decrease) in Net Assets Before Transfers 1,255.1 1,123.5 131.6 11.7 %

Transfers Out (47.7) (77.7) 30.0 38.6 %

Change in Net Assets 1,207.4 1,045.8 161.6 15.5 %

Beginning Net Assets 13,658.6 12,612.8 1,045.8 8.3 %

Ending Net Assets $ 14,866.0 $ 13,658.6 $ 1,207.4 8.8 %

Table IIIBUSINESS ACTIVITIES CHANGES IN NET ASSETS

(In Thousands)

Change in Amount

PercentChange




14

The Preschoool Program for Children with Disabilities fund increased the number of locations that the program is being offered and has a corresponding increase in both revenues and expenses. The expenses for business-type activities decreased slightly when compared to the prior year as the District’s continued to cut costs as part of its austerity program. FUND FINANCIAL ANALYSIS As the District completed the fiscal year, the Governmental Funds reported a combined fund balance of $257.3 million, which is approximately $41.9 million less than last year's total of $299.2 million. The primary reason for the Governmental Fund’s decrease in fund balance is due to the construction of projects related to the Series 2007A bonds and construction in the Qualified School Construction bond programs. The construction projects incurred expenditures of $65.1 million with revenues of only $2.1 million. The General Fund had a net increase in fund balance of $27.1 million as it implemented an austerity plan over the past several years which reduced expenditures and staffing in anticipation of State funding cuts. The increase in fund balance is also due to the District reclassifying salaries that had been paid using General Fund money in the past year to a special revenue fund, Education Jobs. This grant allowed the District to reduce salary expenditures for instructional staff within the General Fund. However, this funding source was a one-year grant and will not be available to the District in future years. The Debt Service Fund had a net decrease in fund balance which was budgeted for in order to meet debt service requirements and maintain a low tax rate for citizens. The fund balance decreased by $5.5 million as the I & S tax rate remained at $0.3629 per hundred dollars of valuation for fiscal year 2011-2012 while debt service requirements increased. Over the course of the year, the Board of Trustees revised the District's budget five times. These budget amendments are categorized into three classifications: (1) increase to the fund balance; (2) decrease to the fund balance; and (3) no change to the fund balance. This allowed the District to adjust its budget as circumstances and needs changed during the year. Budgeted revenue between the original and final budget amendments increased less than one percent as the District adjusted its funding estimate throughout the year. The adjustments were made as new information on significant components of the funding formula such as property tax collection rates and student attendance rates was available. The largest increase to budgeted revenue was for higher collections in the School Health and Related Services (SHARS) program.




15

The net effect of the budget amendments during the year was to reduce appropriations by $1.8 million. The major changes to the budgeted appropriations included reducing the budget for salaries as existing vacant positions were not filled and purchase orders from the prior year were re-encumbered in the current year. The actual expenditures were $11.6 million less than the final amended budget. This is due to fiscal stewardship of the District’s budget managers and to various purchase orders not being filled prior to year-end.

CAPITAL ASSET AND DEBT ADMINISTRATION

Capital Assets As of June 30, 2012, the District had $1.25 billion, net of accumulated depreciation/amortization, invested in a broad range of capital assets, including facilities and equipment for instruction, transportation, athletics, administration, maintenance, and construction in progress. This represents a net increase of $12.2 million from fiscal year 2010-2011. See Footnote IV E and the capital asset schedules following the District’s combining schedules for more detailed analysis of the year’s capital asset activity. This year's government-wide capital asset major additions included (at historical cost): Land $ 67,139 Buildings and Improvements 6,983,111Furniture and Equipment 3,655,559Construction in Progress 53,534,276

$ 64,240,085




16

Debt At year-end, the District had $1.282 billion in bonds outstanding versus $1.329 billion last year (see Footnote IV L). The District's general obligation bonds have received the highest rating possible from the national rating agencies because of the Permanent School Fund guarantee of the District’s debt. Other obligations include accrued vacation pay, sick leave, workers compensation accrued liability, and a net other post-employment benefit (OPEB) liability. Detailed information about the District's long-term liabilities is presented (Footnote IV L) in the Notes to the Financial Statements. NEXT YEAR'S BUDGETS AND RATES The District still faces significant uncertainty regarding its revenue. This uncertainty comes from concerns regarding the ability of the State to pay its higher share of revenue to school districts without significant new tax sources. The State of Texas decreased its funding of public education by $4.0 billion in its last legislative session, which resulted in the District receiving approximately $70 million less in State funding in fiscal years 2011-2012 and 2012-2013. The District expects to receive approximately $10.0 million dollars less funding from the State in the General Fund in fiscal 2012-2013 than it did in fiscal 2011-2012. The decrease is approximately $42 million less then what the District would have received prior to the State changing its funding formula. At $1.04 per hundred dollars of assessed valuation, the District’s 2011-2012 M&O tax rate is at the State’s maximum rate without voter approval. Any additional M&O tax rate exceeding $1.04 will require voter approval up to a maximum ceiling of $1.17. Additionally, the District is now considered a property wealthy school district under Chapter 41 of the Texas Education Code. Under these provisions, the District’s State aid will be reduced to offset a portion of any tax revenue from a tax rate above $1.06 per hundred dollars of valuation to help fund property poor school districts. This restriction further limits the District’s ability to increase revenue from increases in property tax revenue. The future local share of the financial needs of the District will depend upon the willingness of its taxpayers to increase the local tax rate if additional funding is required to meet the educational needs of the District’s students. The following figure illustrates the projected (2013) and historical (2012 and prior) sources of the District’s operating revenue.




17

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

General Fund Revenue By Source

Misc Local, State & Federal Revenue

State Formula Grants

Property Taxes

The I&S tax rate increased for the 2012-2013 fiscal year to $0.3685 per hundred dollars of assessed valuation. The tax rate was determined by calculating the rate required to meet debt service obligations given the assessed value of real, business and personal property within the District’s boundaries and reflects the increased debt service requirements associated with a bond issued in August 2012. For fiscal year 2012-2013, the Board of Trustees adopted a budget with a deficit of $17.2 million. The budgeted appropriations increased $22.5 million compared to the final 2011-2012 budget. The increase is due to the General Fund absorbing payroll costs that were paid in other funds in the prior year ($13.0 million), cost of a salary increase for employees (7.1 million), transfer of funds to accumulate resources for the Qualified School Construction Notes, increased costs related to health insurance, TRS, fuel and other additional costs.

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

18


19

Basic Financial Statements

20


EXHIBIT A-1NORTH EAST INDEPENDENT SCHOOL DISTRICT

STATEMENT OF NET ASSETSJUNE 30, 2012

1 2 3

Control

Data

CodesGovernmental

Activities Activities

Type

Business

Total

Primary Government

ASSETS4,669,035 106,727,849 111,396,884 Cash and Cash Equivalents $ $ $1110

- 188,307,244 188,307,244 Investments1120

- 28,692,620 28,692,620 Property Taxes Receivable1220

- (2,343,721) (2,343,721)Allowance for Uncollectible Taxes1230

12,660 42,261,173 42,273,833 Due From Other Governments1240

- 544,832 544,832 Accrued Interest1250

293,603 (293,603) - Internal Balances1260

- 98,459 98,459 Due From Fiduciary Funds1267

158,255 1,336,963 1,495,218 Other Receivables, Net1290

- 4,972,497 4,972,497 Inventories1300

- 5,768,032 5,768,032 Capitalized Bond and Other Debt Issuance Costs1420

- 18,620 18,620 Other Current Assets1490

Capital Assets:

2,547,600 84,095,820 86,643,420 Land1510

7,283,102 1,060,128,404 1,067,411,506 Buildings, Net1520

85,747 19,325,436 19,411,183 Furniture and Equipment, Net1530

- 81,488,185 81,488,185 Construction in Progress1580

Total Assets1000 1,621,128,810 15,050,002 1,636,178,812

LIABILITIES20,127 17,364,199 17,384,326 Accounts Payable2110

- 24,611,304 24,611,304 Interest Payable2140

- 5,463,415 5,463,415 Payroll Deductions & Withholdings2150

92,161 49,511,776 49,603,937 Accrued Wages Payable2160

- 7,699 7,699 Due to Fiduciary Funds2177

95 1,031,192 1,031,287 Due to Other Governments2180

- 594 594 Due to Student Groups2190

- 6,781,118 6,781,118 Accrued Expenses2200

71,669 4,954,410 5,026,079 Unearned Revenues2300

Noncurrent Liabilities

- 48,981,574 48,981,574 Due Within One Year2501

- 1,238,973,433 1,238,973,433 Due in More Than One Year2502

Total Liabilities2000 1,397,680,714 184,052 1,397,864,766

NET ASSETS

9,916,449 9,838,474 19,754,923 Invested in Capital Assets, Net of Related Debt3200

Restricted for: - 9,726,250 9,726,250 Restricted for Federal and State Programs3820

- 81,529,099 81,529,099 Restricted for Debt Service3850

- 24,105,519 24,105,519 Restricted for Capital Projects3860

- 231,827 231,827 Restricted for Scholorships3880

4,949,501 98,016,927 102,966,428 Unrestricted Net Assets3900

Total Net Assets3000 223,448,096 14,865,950 238,314,046 $ $ $

21

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

NORTH EAST INDEPENDENT SCHOOL DISTRICTSTATEMENT OF ACTIVITIES

FOR THE YEAR ENDED JUNE 30, 2012

Control

Data

CodesExpenses Services

Charges for

Contributions

Grants and

Operating

Program Revenues

431

Primary Government:GOVERNMENTAL ACTIVITIES:

4,747,562 362,214,813 56,962,361 Instruction $ $ $11

- 11,264,201 593,826 Instructional Resources and Media Services12

751,071 15,741,780 4,986,418 Curriculum and Staff Development13

- 6,421,877 1,247,010 Instructional Leadership21

819,350 31,110,802 1,565,257 School Leadership23

- 18,826,969 2,433,023 Guidance, Counseling and Evaluation Services31

- 3,910,851 1,633,570 Social Work Services32

- 7,304,746 590,121 Health Services33

- 19,620,934 909,310 Student Transportation34

13,053,012 31,703,494 16,854,527 Food Services35

2,500,124 15,185,517 184,754 Extracurricular Activities36

- 10,239,863 741,016 General Administration41

- 55,143,500 3,288,379 Facilities Maintenance and Operations51

- 3,697,076 455,891 Security and Monitoring Services52

- 4,304,519 426,884 Data Processing Services53

912,809 2,490,482 517,678 Community Services61

- 59,422,600 - Debt Service - Interest on Long Term Debt72

- 302,919 - Debt Service - Bond Issuance Cost and Fees73

- 395,184 - Instructional Shared Services Arrangements93

- 129,060 - Juvenile Justice Alternative Ed. Prg.95

- 1,914,188 - Property Tax Appraisal Services99

661,345,375 22,783,928 93,390,025 [TG] Total Governmental Activities:

BUSINESS-TYPE ACTIVITIES:618,215 763,699 - Facilities Rental01

62,982 24,198 - Uniform Rental02

7,663,258 6,465,728 - Community Education03

466,302 425,314 - Preschool Program for Children w/Disabilities04

697,540 574,334 - North East Aquatics & Tennis06

8,253,273 9,508,297 - [TB] Total Business-Type Activities:

[TP] TOTAL PRIMARY GOVERNMENT: 669,598,648 32,292,225 93,390,025 $ $ $

DataControlCodes

General Revenues:Taxes:

Property Taxes, Levied for General PurposesM T

Property Taxes, Levied for Debt ServiceDT

State Aid - Formula GrantsSF

Grants and Contributions not RestrictedGC

Investment EarningsIE

Miscellaneous Local and Intermediate RevenueMI

Transfers In (Out)FR

Total General Revenues & TransfersTR

Net Assets--Beginning

Change in Net Assets

Net Assets--Ending

CN

NB

NE

22The notes to the financial statements are an integral part of this statement.

EXHIBIT B-1

Net (Expense) Revenue and

Activities Activities

Business Type

Total

Governmental

Changes in Net Assets

6 7 8

Primary Government

- (300,504,890) (300,504,890)$ $ $

- (10,670,375) (10,670,375)

- (10,004,291) (10,004,291)

- (5,174,867) (5,174,867)

- (28,726,195) (28,726,195)

- (16,393,946) (16,393,946)

- (2,277,281) (2,277,281)

- (6,714,625) (6,714,625)

- (18,711,624) (18,711,624)

- (1,795,955) (1,795,955)

- (12,500,639) (12,500,639)

- (9,498,847) (9,498,847)

- (51,855,121) (51,855,121)

- (3,241,185) (3,241,185)

- (3,877,635) (3,877,635)

- (1,059,995) (1,059,995)

- (59,422,600) (59,422,600)

- (302,919) (302,919)

- (395,184) (395,184)

- (129,060) (129,060)

- (1,914,188) (1,914,188)

(545,171,422) - (545,171,422)

(145,484) - (145,484)

38,784 - 38,784 1,197,530 - 1,197,530

40,988 - 40,988

123,206 - 123,206

- 1,255,024 1,255,024

(545,171,422) 1,255,024 (543,916,398)

- 280,835,492 280,835,492

- 98,024,700 98,024,700

- 169,075,359 169,075,359

- 7,146,480 7,146,480

- 3,008,213 3,008,213

- 3,865,677 3,865,677

(47,652)47,652 -

562,003,573 (47,652) 561,955,921

16,832,151

206,615,945

223,448,096 $

1,207,372

13,658,578

14,865,950 $

18,039,523

220,274,523

238,314,046 $

23

NORTH EAST INDEPENDENT SCHOOL DISTRICT

BALANCE SHEET

GOVERNMENTAL FUNDS

JUNE 30, 2012

Control

Data

Codes

General

Fund Fund

Debt Service

50

Projects

Capital

6010

ASSETS19,156,610 32,040,741 39,544,617 Cash and Cash Equivalents $ $ $1110

57,401,328 97,064,756 19,486,128 Investments1120

7,053,883 21,638,737 - Property Taxes1220

(551,883)(1,791,838) - Allowance for Uncollectible Taxes1230

- 35,467,421 - Receivables From Other Governments1240

59,644 290,891 107,917 Accrued Interest1250

5,762,588 6,364,818 154,125 Due From Other Funds1260

- 229,997 612 Other Receivables1290

- 2,174,173 - Inventories1300

- 18,620 - Other Current Assets1490

Total Assets1000 193,498,316 88,882,170 59,293,399 $ $ $

LIABILITIES AND FUND BALANCES

Liabilities: - 4,017,873 11,833,977 Accounts Payable $ $ $2110

- 5,463,415 - Payroll Deductions and Withholdings Payable2150

- 43,641,726 - Accrued Wages Payable2160

550 13,284,344 1,728,257 Due to Other Funds2170

989,642 39,288 - Due to Other Governments2180

- 594 - Due to Student Groups2190

- - 2,621,118 Accrued Expenditures2200

3,127,336 10,297,101 - Deferred Revenues2300

Total Liabilities2000 76,744,341 4,117,528 16,183,352

Fund Balances:

Nonspendable Fund Balance: - 2,174,173 - Inventories3410

- - - Endowment Principal3425

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

- - 43,110,047 Capital Acquisition and Contractural Obligation3470

82,716,079 - - Retirement of Long-Term Debt3480

- - - Other Restricted Fund Balance3490

Committed Fund Balance: - - - Other Committed Fund Balance3545

Assigned Fund Balance:2,048,563 - - Retirement of Loans or Notes Payable3565

- 114,579,802 - Unassigned Fund Balance3600

Total Fund Balances3000 116,753,975 84,764,642 43,110,047

$ 193,498,316 $ 88,882,170 $ 59,293,399 Total Liabilities and Fund Balances4000

24


EXHIBIT C-1

Other

Funds Funds

Governmental

Total

6,701,542 97,443,510 $ $5,545,134 179,497,346

- 28,692,620 - (2,343,721)

5,973,681 41,441,102 19,102 477,554

6,294,209 18,575,740 18,708 249,317

1,444,505 3,618,678 - 18,620

25,996,881 367,670,766 $ $

470,466 16,322,316 $ $ - 5,463,415

4,854,447 48,496,173 6,845,907 21,859,058

1,896 1,030,826 - 594 - 2,621,118

1,185,932 14,610,369

13,358,648 110,403,869

959,239 3,133,412 200,000 200,000

8,767,011 8,767,011 - 43,110,047 - 82,716,079

31,827 31,827

2,680,156 2,680,156

- 2,048,563 - 114,579,802

12,638,233 257,266,897

$ $ 367,670,766 25,996,881

25

EXHIBIT C-2NORTH EAST INDEPENDENT SCHOOL DISTRICT

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

JUNE 30, 2012

257,266,897 $Total Fund Balances - Governmental Funds

20,163,471 1 The District uses internal service funds to charge the costs of certain activities, such as The District uses internal service funds to charge the costs of certain activities, such as self-insurance and printing, to appropriate functions in other funds. The assets and The District uses internal service funds to charge the costs of certain activities, such as self-insurance and printing, to appropriate functions in other funds. The assets and liabilities of the internal service funds are included in governmental activities in the

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

(126,286,259)2 Capital assets used in governmental activities are not financial resources and therefore Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds. At the beginning of the year, the cost of these Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds. At the beginning of the year, the cost of these assets was $1,620,377,833 and the accumulated depreciation was $393,822,343. In

Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds. At the beginning of the year, the cost of these assets was $1,620,377,833 and the accumulated depreciation was $393,822,343. In addition, long-term liabilities, including bonds payable, are not due and payable in the current period, and, therefore are not reported as liabilities in the funds. The net effect

Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds. At the beginning of the year, the cost of these assets was $1,620,377,833 and the accumulated depreciation was $393,822,343. In addition, long-term liabilities, including bonds payable, are not due and payable in the current period, and, therefore are not reported as liabilities in the funds. The net effect of including the beginning balances for capital assets (net of depreciation) and long-

Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds. At the beginning of the year, the cost of these assets was $1,620,377,833 and the accumulated depreciation was $393,822,343. In addition, long-term liabilities, including bonds payable, are not due and payable in the current period, and, therefore are not reported as liabilities in the funds. The net effect of including the beginning balances for capital assets (net of depreciation) and long-term debt in the governmental activities is to decrease net assets. See Fooutnote II.A

Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds. At the beginning of the year, the cost of these assets was $1,620,377,833 and the accumulated depreciation was $393,822,343. In addition, long-term liabilities, including bonds payable, are not due and payable in the current period, and, therefore are not reported as liabilities in the funds. The net effect of including the beginning balances for capital assets (net of depreciation) and long-term debt in the governmental activities is to decrease net assets. See Fooutnote II.A for further details.

109,421,956 3 Current year capital outlays and long-term debt principal payments are expenditures in Current year capital outlays and long-term debt principal payments are expenditures in the fund financial statements,but they should be shown as increases in capital assets Current year capital outlays and long-term debt principal payments are expenditures in the fund financial statements,but they should be shown as increases in capital assets and reductions in long-term debt in the government-wide financial statements. The net

Current year capital outlays and long-term debt principal payments are expenditures in the fund financial statements,but they should be shown as increases in capital assets and reductions in long-term debt in the government-wide financial statements. The net effect of including the 2012 capital outlays and debt principal payments is to increase net assets. See Footnote II.B for further details.

(50,399,056)4 The 2012 depreciation expense increases accumulated depreciation. The net effect of The 2012 depreciation expense increases accumulated depreciation. The net effect of the current year's depreciation is to decrease net assets.

13,281,087 5 Various other reclassifications and eliminations are necessary to convert from the Various other reclassifications and eliminations are necessary to convert from the modified accrual basis of accounting to accrual basis of accounting. These include Various other reclassifications and eliminations are necessary to convert from the modified accrual basis of accounting to accrual basis of accounting. These include recognizing deferred revenue as revenue, eliminating interfund transactions,

Various other reclassifications and eliminations are necessary to convert from the modified accrual basis of accounting to accrual basis of accounting. These include recognizing deferred revenue as revenue, eliminating interfund transactions, reclassifying the proceeds of bond sales as an increase in bonds payable, and recognizing the liabilities associated with maturing long-term debt and interest. The net

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

223,448,096 $19 Net Assets of Governmental Activities

26


27



STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

GOVERNMENTAL FUNDS


ControlData

Codes Fund

General

10

Fund

Debt Service

50

Projects

Capital

60

REVENUES:286,737,278 98,864,703 1,882,722 Total Local and Intermediate Sources $ $ $5700190,250,771 18,309 185,908 State Program Revenues5800

6,384,150 1,967,358 - Federal Program Revenues5900

Total Revenues5020 483,372,199 100,850,370 2,068,630

EXPENDITURES:Current:

280,669,015 - - Instruction00117,979,421 - - Instructional Resources and Media Services0012

10,266,198 - - Curriculum and Instructional Staff Development00135,397,822 - - Instructional Leadership0021

29,313,593 - - School Leadership002316,754,183 - - Guidance, Counseling and Evaluation Services0031

2,369,370 - - Social Work Services00326,700,956 - - Health Services0033

17,090,119 - - Student Transportation003420,962 - - Food Services0035

8,999,769 - - Extracurricular Activities003610,204,973 - - General Administration004149,017,586 - - Facilities Maintenance and Operations0051

3,919,013 - - Security and Monitoring Services00523,821,576 - - Data Processing Services0053

196,890 - - Community Services0061

Debt Service: - 46,685,000 - Principal on Long Term Debt0071 - 60,029,974 - Interest on Long Term Debt0072 - 2,750 - Bond Issuance Cost and Fees0073

Capital Outlay:5,000 - 65,140,367 Facilities Acquisition and Construction0081

Intergovernmental:395,184 - - Instructional Shared Service Arrangements0093129,060 - - Juvenile Justice Alternative Education Program0095

1,914,188 - - Property Tax Appraisal Services0099

Total Expenditures6030 455,164,878 106,717,724 65,140,367

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

28,207,321 (5,867,354) (63,071,737)

OTHER FINANCING SOURCES (USES): - - - Sale of Real and Personal Property7912

325,723 379,566 122,000 Transfers In7915(1,459,790) - (27,419)Transfers Out8911

Total Other Financing Sources (Uses) 7080 (1,134,067) 379,566 94,581

1200 Net Change in Fund Balances 27,073,254 (5,487,788) (62,977,156)

0100 Fund Balance - July 1 (Beginning) 89,680,721 90,252,430 106,087,203

3000 Fund Balance - June 30 (Ending) $ 116,753,975 $ 84,764,642 $ 43,110,047

28


EXHIBIT C-3

Other

Funds Funds

Governmental

Total

407,573,217 20,088,514 $ $

204,452,971 13,997,983

64,333,954 55,982,446

90,068,943 676,360,142

329,227,764 48,558,749

8,212,815 233,394

15,626,407 5,360,209

6,352,202 954,380

29,409,055 95,462

18,332,766 1,578,583

3,863,889 1,494,519

6,939,591 238,635

17,214,233 124,114

29,641,367 29,620,405

9,054,132 54,363

10,240,180 35,207

50,456,180 1,438,594

4,139,986 220,973

3,946,486 124,910

518,024 321,134

46,685,000 -

60,029,974 -

2,750 -

65,145,367 -

395,184 -

129,060 -

1,914,188 -

90,453,631 717,476,600

(384,688) (41,116,458)

1,824 1,824

982,917 155,628

(1,778,265)(291,056)

(133,604) (793,524)

(518,292) (41,909,982)

13,156,525 299,176,879

$ 12,638,233 $ 257,266,897

29


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


(41,909,982)$Total Net Change in Fund Balances - Governmental Funds

(1,185,342)The District uses internal service funds to charge the costs of certain activities, such as The District uses internal service funds to charge the costs of certain activities, such as self-insurance and printing, to appropriate functions in other funds. The net income The District uses internal service funds to charge the costs of certain activities, such as self-insurance and printing, to appropriate functions in other funds. The net income (loss) of internal service funds are reported with governmental activities. The net effect

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

109,421,956 Current year capital outlays and long-term debt principal payments are expenditures in Current year capital outlays and long-term debt principal payments are expenditures in the fund financial statements, but they should be shown as increases in capital assets and Current year capital outlays and long-term debt principal payments are expenditures in the fund financial statements, but they should be shown as increases in capital assets and reductions in long-term debt in the government-wide financial statements. The net effect

Current year capital outlays and long-term debt principal payments are expenditures in the fund financial statements, but they should be shown as increases in capital assets and reductions in long-term debt in the government-wide financial statements. The net effectof removing the 2012 capital outlays and debt principal payments is to increase net assets. See Footnote II. B for further detail.

(50,399,056)Depreciation is not recognized as an expense in governmental funds since it does not Depreciation is not recognized as an expense in governmental funds since it does not require the use of current financial resources. The net effect of the current year's Depreciation is not recognized as an expense in governmental funds since it does not require the use of current financial resources. The net effect of the current year's depreciation is to decrease net assets.

904,575 Various other reclassifications and eliminations are necessary to convert from the Various other reclassifications and eliminations are necessary to convert from the modified accrual basis of accounting to accrual basis of accounting. These include Various other reclassifications and eliminations are necessary to convert from the modified accrual basis of accounting to accrual basis of accounting. These include recognizing deferred revenue as revenue, adjusting current year revenue to show the

Various other reclassifications and eliminations are necessary to convert from the modified accrual basis of accounting to accrual basis of accounting. These include recognizing deferred revenue as revenue, adjusting current year revenue to show the revenue earned from the current year's tax levy, eliminating interfund transactions, reclassifying the proceeds of bond sales, and recognizing the liabilities associated with

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

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

16,832,151 $ Change in Net Assets of Governmental Activities

30



STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL - GENERAL FUND


Control

Data

CodesOriginal Final

(GAAP BASIS)

(Negative)

Positive or

Final BudgetVariance WithActual Amounts

Budgeted Amounts

REVENUES:288,530,804 281,854,461 286,737,278 (1,793,526)Total Local and Intermediate Sources $ $ $ $5700

188,926,957 195,726,957 190,250,771 1,323,814 State Program Revenues5800

6,211,430 5,355,147 6,384,150 172,720 Federal Program Revenues5900

Total Revenues5020 482,936,565 483,669,191 483,372,199 (296,992)

EXPENDITURES:

Current:286,450,165 289,954,127 280,669,015 5,781,150 Instruction0011

8,113,583 8,139,960 7,979,421 134,162 Instructional Resources and Media Services0012

10,540,515 10,172,988 10,266,198 274,317 Curriculum and Instructional Staff Development0013

5,498,397 5,953,941 5,397,822 100,575 Instructional Leadership0021

29,670,220 29,089,494 29,313,593 356,627 School Leadership0023

17,103,297 16,764,549 16,754,183 349,114 Guidance, Counseling and Evaluation Services0031

2,420,494 2,478,826 2,369,370 51,124 Social Work Services0032

6,889,396 7,067,597 6,700,956 188,440 Health Services0033

17,824,302 15,959,750 17,090,119 734,183 Student Transportation0034

52,691 - 20,962 31,729 Food Services0035

9,585,395 9,162,823 8,999,769 585,626 Extracurricular Activities0036

10,667,871 10,868,827 10,204,973 462,898 General Administration0041

51,284,859 52,223,217 49,017,586 2,267,273 Facilities Maintenance and Operations0051

3,995,150 3,722,393 3,919,013 76,137 Security and Monitoring Services0052

3,895,023 3,795,423 3,821,576 73,447 Data Processing Services0053

218,155 191,201 196,890 21,265 Community Services0061

Capital Outlay:5,000 - 5,000 - Facilities Acquisition and Construction0081

Intergovernmental:432,102 400,000 395,184 36,918 Instructional Shared Service Arrangements0093

222,069 412,069 129,060 93,009 Juvenile Justice Alternative Education Program0095

1,945,215 2,255,215 1,914,188 31,027 Property Tax Appraisal Services0099

Total Expenditures6030 468,612,400 466,813,899 455,164,878 11,649,021


14,324,165 16,855,292 28,207,321 11,352,029

OTHER FINANCING SOURCES (USES): 272,000 225,000 325,723 53,723 Transfers In7915

(1,385,000)(2,758,000) (1,459,790) (74,790)Transfers Out8911

Total Other Financing Sources (Uses) 7080 (2,533,000) (1,113,000) (1,134,067) (21,067)

1200 Net Change in Fund Balances 11,791,165 15,742,292 27,073,254 11,330,962

0100 Fund Balance - July 1 (Beginning) 89,680,721 89,680,721 89,680,721 -

3000 Fund Balance - June 30 (Ending) $ 101,471,886 $ 105,423,013 $ 116,753,975 $ 11,330,962

31


EXHIBIT D-1NORTH EAST INDEPENDENT SCHOOL DISTRICT

STATEMENT OF NET ASSETSPROPRIETARY FUNDS

JUNE 30, 2012

Total

Enterprise

Funds Service Funds

Internal

Total

Governmental

Activities -

Business-Type

Activities -

ASSETS

Current Assets:9,284,339 4,669,035 Cash and Cash Equivalents $ $8,809,898 - Investments - Current

338 12,660 Due from Other Governments67,278 - Accrued Interest

3,864,773 1,137,800 Due from Other Funds1,087,646 158,255 Other Receivables1,353,819 - Inventories

5,977,750 24,468,091 Total Current Assets

Noncurrent Assets:Capital Assets:

- 2,547,600 Land483,379 9,883,138 Buildings and Improvements

(246,602)(2,600,036)Depreciation on Buildings13,772,988 205,999 Furniture and Equipment(6,954,075)(120,252)Depreciation on Furniture and Equipment

9,916,449 7,055,690 Total Noncurrent Assets

Total Assets 15,894,199 31,523,781

LIABILITIES

Current Liabilities:1,041,883 20,127 Accounts Payable

449,019 - Short Term Workers Compensation Payable65,467 92,161 Accrued Wages Payable

784,298 844,197 Due to Other Funds366 95 Due to Other Governments

4,160,000 - Accrued Expenses3,625,128 71,669 Unearned Revenues

1,028,249 10,126,161 Total Current Liabilities

Noncurrent Liabilities:1,234,149 - Accrued Expenses - Due in More than One Year

- 1,234,149 Total Noncurrent Liabilities

Total Liabilities 1,028,249 11,360,310

NET ASSETS

7,055,690 9,916,449 Invested in Capital Assets13,107,781 4,949,501 Unrestricted Net Assets

Total Net Assets 14,865,950 20,163,471 $ $

32


EXHIBIT D-2NORTH EAST INDEPENDENT SCHOOL DISTRICT

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


Total

Enterprise

Funds Service Funds

Internal

Total

Business-Type

Activities -

Governmental

Activities -

OPERATING REVENUES:

70,243,082 9,224,484 Local and Intermediate Sources $ $681,922 232,954 State Program Revenues

1,185,792 - Federal Revenues

Total Operating Revenues 9,457,438 72,110,796

OPERATING EXPENSES:

9,927,672 6,189,561 Payroll Costs5,089,453 654,757 Professional and Contracted Services2,868,647 394,896 Supplies and Materials

55,140,839 570,252 Other Operating Costs1,161,187 408,994 Depreciation Expense

Total Operating Expenses 8,218,460 74,187,798

Operating Income (Loss) 1,238,978 (2,077,002)

NONOPERATING REVENUES (EXPENSES):

- 50,859 Gain on Sale of Real and Personal Property55,976 - Earnings From Temporary Deposits & Investments(5,785) - Loss on Sale of Real and Personal Property(1,531)(34,813)Nonoperating Expenses

Total Nonoperating Revenues (Expenses) 16,046 48,660

Income Before Transfers 1,255,024 (2,028,342)

3,580,133 - Transfers In(2,737,133)(47,652)Transfers Out


Total Net Assets - July 1 (Beginning)

Total Net Assets - June 30 (Ending)

1,207,372

13,658,578

$ 14,865,950

(1,185,342)

21,348,813

$ 20,163,471

33


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

FOR THE YEAR ENDED JUNE 30, 2012PROPRIETARY FUNDS

Total Total

Enterprise Internal

Funds Service Funds

Governmental

Activities -

Business-Type

Activities

Cash Flows from Operating Activities:

71,620,714 9,258,998 Cash Received From User Charges $ $

3,643,633 3,119,949 Cash Received From Assessments - Other Funds(9,235,392)(5,949,915)Cash Payments to Employees for Services

(54,715,676) - Cash Payments for Insurance Claims(9,735,028)(1,711,296)Cash Payments for Suppliers(5,007,768) - Cash Payments to Other Funds - Operating Expenses

4,717,736 Net Cash Provided by (Used for) Operating

(3,429,517)Activities

Cash Flows from Non-Capital Financing Activities:

2,189,924 - Increase (Decrease) in Short-term Loans(1,346,924)(47,652)Transfers Out

- 50,859 Gain on Sale of Non Capital Assets

3,207 Net Cash Provided by Non-Capital

843,000 Financing Activities

Cash Flows from Capital & Related Financing Activities:

(2,391,859)(17,445)Acquisition of Capital Assets(86,251) - Payments on Capital Leases26,270 - Gain on Sale of Capital Assets

- (34,813)Interest Expense on Internal Loan

(52,258)Net Cash Provided by (Used for) Capital &

(2,451,840)Related Financing Activities

Cash Flows from Investing Activities:

(4,832,595) - Purchase of Investment Securities43,319 - Interest and Dividends on Investments

- Net Cash Provided by (Used for) Investing

(4,789,276)Activities

Net Increase (Decrease) in Cash and Cash Equivalents 4,668,685 (9,827,633)

Cash and Cash Equivalents at Beginning of Year 350 19,111,972

Cash and Cash Equivalents at End of Year 4,669,035 9,284,339 $ $

34


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

FOR THE YEAR ENDED JUNE 30, 2012PROPRIETARY FUNDS

Total Total

Enterprise Internal

Funds Service Funds

Governmental

Activities -

Business-Type

Activities

Operating Income (Loss): $ $

Reconciliation of Operating Income (Loss) to Net Cash

Provided by (Used for) Operating Activities:1,238,978 (2,077,002)

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

1,161,187 408,994 Depreciation

Assets and Liabilities:Effect of Increases and Decreases in Current

924 34,397 Decrease (Increase) in Receivables175,924 - Decrease (Increase) in Inventories

- 6,577 Decrease (Increase) in Due From Other Governments3,314,856 3,620,489 Decrease (Increase) in Due From Other Funds(293,826)(91,388)Increase (Decrease) in Accounts Payable190,916 (308,143)Increase (Decrease) in Unearned Revenues

234 (38)Increase (Decrease) in Due to Other Governments(4,679,225)(198,818)Increase (Decrease) in Due to Other Funds

10,354 6,688 Increase (Decrease) in Accrued Wages Payable(682,878) - Increase (Decrease) in Accrued Expenses(550,981) - Increase (Decrease) in Workers' Comp Payable

Net Cash Provided by (Used for)(3,429,517)Operating Activities 4,717,736 $ $

Noncash Investing, Capital and Financing Activities:

1,335,142 - Contributions of Capital Assets From Other Funds1,233,859 - Change in Actuarial Estimates

16,552 - Increase in Fair Value of Investments

35


EXHIBIT E-1NORTH EAST INDEPENDENT SCHOOL DISTRICT

STATEMENT OF FIDUCIARY NET ASSETSFIDUCIARY FUNDS

JUNE 30, 2012

Private

Purpose

Trust Fund Funds

Agency

ASSETS

2,338,604 238,404 Cash and Cash Equivalents $ $

13,344 - Due from Other Funds

110 - Other Receivables

Total Assets 238,404 2,352,058 $

LIABILITIES

23,703 - Accounts Payable $

104,104 - Due to Other Funds

5,805 - Due to Other Governments

2,218,446 - Due to Student Groups

Total Liabilities - 2,352,058 $

NET ASSETS

238,404 Unrestricted Net Assets

Total Net Assets 238,404 $

36


EXHIBIT E-2NORTH EAST INDEPENDENT SCHOOL DISTRICT

STATEMENT OF CHANGES IN FIDUCIARY FUND NET ASSETSFIDUCIARY FUNDS


Private

Purpose

Trust Fund

ADDITIONS:

264,754 Local and Intermediate Sources $

Total Additions 264,754

DEDUCTIONS:

26,350 Other Operating Costs

Total Deductions 26,350




238,404

-

$ 238,404

37


38



Notes to the Financial Statements


39

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




40

B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (continued) Interfund activities among governmental funds and between governmental funds and proprietary funds appear as due to/due from other funds on the Governmental Fund Balance Sheet and Proprietary Fund Statement of Net Assets and as other financing sources and uses on the Governmental Fund Statement of Revenues, Expenditures and Changes in Fund Balance and on the Proprietary Fund Statement of Revenues, Expenses and Changes in Fund Net Assets. Interfund services provided and used are not eliminated in the consolidation of funds for the Statement of Activities. All interfund transactions that do not represent services provided and used between governmental funds and between governmental funds and internal service funds are eliminated on the government-wide statements. Interfund activities between governmental funds and enterprise funds remain on the government-wide statements and appear on the government-wide Statement of Net Assets as internal balances and on the Statement of Activities as interfund transfers. Interfund activities between governmental funds and fiduciary funds remain as due to/due from other funds on the government-wide Statement of Net Assets. The fund financial statements report the financial condition and results of operations for three fund categories - governmental, proprietary, and fiduciary. Since the resources in the fiduciary funds cannot be used for District operations, they are not included in the government-wide statements. The District considers some governmental funds major and reports their financial condition and results of operations in a separate column. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. All other revenues and expenses are nonoperating. C. MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL

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




41

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

The modified accrual basis of accounting recognizes revenues in the accounting period in which they become both measurable and available, and it recognizes expenditures in the accounting period in which the fund liability is incurred, if measurable, except for unmatured interest and principal on long-term debt, which is recognized when due. The expenditures related to certain compensated absences and claims and judgments are recognized when the obligations are expected to be liquidated with expendable available financial resources. The District considers all revenues available if they are collectible within 60 days after year end. Revenues from local sources consist primarily of property taxes. Property tax revenues and revenues received from the State are recognized under the susceptible-to-accrual concept. Miscellaneous revenues are recorded as revenue when received in cash because they are generally not measurable until actually received. Investment earnings are recorded as earned, since they are both measurable and available. Grant fund revenues are considered to be earned to the extent of expenditures made under the provisions of the grant. Accordingly, when such funds are received, they are recorded as deferred revenues until related and authorized expenditures have been made. If balances have not been expended by the end of the project period, grantors sometimes require the District to refund all or part of the unused amount. Permanent funds report resources that are restricted to the extent that only earnings and not principal may be used for purposes that support the District or it’s students. The Proprietary Funds are accounted for on a flow of economic resources measurement focus and utilize the accrual basis of accounting. This basis of accounting recognizes revenues in the accounting period in which they are earned and become measurable and expenses in the accounting period in which they are incurred and become measurable. The District applies all GASB pronouncements as well as the Financial Accounting Standards Board pronouncements issued on or before November 30, 1989, unless these pronouncements conflict with, or contradict GASB pronouncements. With this measurement focus, all assets and all liabilities associated with the operation of these funds are included on the Statement of Net Assets. The total net assets are segregated into invested in capital assets net of related debt, restricted net assets, and unrestricted net assets. Agency Funds utilize the accrual basis of accounting but do not have a measurement focus as they report only assets and liabilities.




42


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

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

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

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

interest on long-term general obligation debt of the District. The main source of revenue for debt service is the apportionment of local property taxes.

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

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

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

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

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

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




43


Proprietary Funds:

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

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

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

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

Fiduciary Funds:

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

Scholarships

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

Student Activity Central Office




44

D. OTHER ACCOUNTING POLICIES

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

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

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

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

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

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

employees provided it is taken prior to the calendar year-end. The accumulated vacation payable at June 30, 2012 and 2011 was $950,136 and $932,144, respectively.

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




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D. OTHER ACCOUNTING POLICIES (continued)

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

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

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

6. Bond proceeds not spent are restricted for construction, technology improvements, bus

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

Health Insurance Dental Insurance Workers’ Compensation Insurance Unemployment Compensation Insurance




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

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

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

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

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

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

11. Investments are valued at fair value.

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

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

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

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

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

have been spent when an expenditure is incurred for the purpose for which the fund balance was restricted, committed or assigned. If an expenditure is incurred that meets the criteria in more than one fund balance category, then the District considers that the fund balance is relieved in the following order: restricted, committed, assigned and then unassigned.




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D. OTHER ACCOUNTING POLICIES (continued) Commitments of fund balance may only be done by a resolution of the Board of Trustees (the “Board”). The commitment may only be relieved by incurring expenditures for that purpose or by resolution of the Board. Assignments of fund balance are established by the Superintendent or his designee and may only be relieved by incurring expenditures for that purpose or as authorized by the Superintendent.

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

II. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL

STATEMENTS

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




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

Capital Assets at the Beginning of the Year Historic Cost

Accumulated Depreciation/Amortization

Net Value at the Beginning

of the YearChange in Net

Assets

Land $ 84,028,681 $ - $ 84,028,681

Buildings and Improvements 1,451,671,609 369,447,213 1,082,224,396

Furniture and Equipment 38,625,204 24,375,130 14,250,074

Construction in Progress 46,052,339 - 46,052,339 Capital Assets Total $ 1,620,377,833 $ 393,822,343 $ 1,226,555,490 $ 1,226,555,490

Capitalized Bond Issuance Costs 6,068,201

Accrued Liabilities at the Beginning of the Year

Payable at the Beginning of

the Year

Bonds Payable $ 1,329,249,909

Interest Payable 25,198,133

Vacation Payable 932,144

Compensated Absences 3,462,947

OPEB Net Obligation/(Benefit) 66,817

Change in Net Assets $ 1,358,909,950 (1,358,909,950)

Net Adjustment to Net Assets $ (126,286,259)




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B. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE

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

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

Changes in Capital Assets Amount

Adjustments to Changes in Net

AssetsAdjustments to

Net Assets

Land $ 67,139 $ -

Buildings and Improvements 6,973,876 18,098,430

Furniture and Equipment 1,250,430 -

Construction in Progress 53,534,276 (18,098,430)

Total Capital Outlay $ 61,825,721 $ - $ 61,825,721

Debt Payments

Bond Principal $ 46,685,000

Accretion on Capital Appreciation Bonds (2,160,763)

Change in Bond Interest Payable 586,829

Amortization of Bond Issuance Costs,

Premiums, and Loss on Refunding 1,881,139

Accrue Tax Credit Receivable 819,733

Change in vacation payable, compensated

absences payable, & OPEB liability (215,703)

Total Debt Payments $ 47,596,235 - 47,596,235 Total Adjustment to Net Assets $ - $ 109,421,956




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

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

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




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A. BUDGETARY DATA (continued)

Original Budget

AppropriationIncrease

(Decrease)

Amended Budget

Appropriation

General Fund $ 468,612,400 $ (1,798,501) $ 466,813,899

National Breakfast and Lunch Program Fund 31,566,039 1,415,000 32,981,039

Debt Service Fund 106,724,974 - 106,724,974

$ 606,903,413 $ (383,501) $ 606,519,912

A reconciliation of fund balances for both appropriated budget and non-appropriated budget Nonmajor Governmental Funds at June 30, 2012 is as follows:

FundBalance

Appropriated Budget Fund National Breakfast and Lunch Program Fund $ 9,054,016

Non-appropriated Budget Funds 3,584,217

All Nonmajor Governmental Funds $ 12,638,233

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




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A. DEPOSITS AND INVESTMENTS (continued) Deposits and investments at June 30, 2012 are as follows:

Cash in Bank or on hand - Primary Government $ 9,420,396Cash Equivalents

Money Market accounts:LOGIC 32,922,028TexPool Prime 59,866,293TexPool 7,188,167Texas TERM CP 2,000,000

Total Cash and Cash Equivalents $ 111,396,884

Investments 188,307,244

Total Deposits and Investments - Primary Government $ 299,704,128

The District utilizes imprest accounts where funds are automatically transferred from a cash management account whenever checks are presented. The cash account balance will occasionally reflect a negative balance as a result of the complexity and timing of various banking transactions. Deposits The FDIC issued a Final Rule implementing section 343 of the Dodd-Frank Wall Street Reform and Consumer Protection Act that provides for unlimited insurance coverage of noninterest-bearing transaction accounts. Beginning December 31, 2010, through December 31, 2012, all noninterest-bearing transaction accounts are fully insured, regardless of the balance of the account, at all FDIC-insured institutions. This unlimited insurance coverage is separate from, and in addition to, the insurance coverage provided to a depositor’s other deposit accounts held at an FDIC-insured institution. The unlimited coverage applies to all personal and business checking deposit accounts that do not earn interest (including Demand Deposit (DDA) accounts), low-interest NOW accounts (NOW accounts that cannot earn more than 0.5% interest), Official Items, and IOLTA accounts. At June 30, 2012, the carrying amount of the District’s deposits was $9,404,958 and the bank balance was $12,741,488. The District’s cash deposits at June 30, 2012 were fully covered by FDIC insurance as outlined above.




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A. DEPOSITS AND INVESTMENTS (continued) In addition, the following is disclosed regarding coverage of combined balances on the date of the highest deposit: a. Depository: Bank of America, N.A.; San Antonio, Texas. b. The highest combined balances of cash, savings, and time deposit accounts at Bank of

America amounted to $67,742,914 and occurred during February 2012. c. Pursuant to the FDIC’s unlimited insurance coverage of noninterest-bearing transaction

accounts, all of the District’s deposits were fully FDIC insured, and no collateral was required or pledged by the Depository as of June 30, 2012.

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




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A. DEPOSITS AND INVESTMENTS (continued)

Investments (continued) Credit Risk. In accordance with state law and the District’s investment policy, investments in mutual funds and investment pools must be rated at least AAA or have an equivalent rating, commercial paper must be rated at least A-1, P-1, or have an equivalent rating, and obligations of states, agencies, counties, and cities must be rated at least A or its equivalent. As of June 30, 2012, the District’s investments in met or exceeded the ratings criteria. S&P has rated the long-term sovereign credit rating on the United States of America to AA+. As a result, the long-term issuer credit ratings and related issue ratings on select government-related entities are also rated AA+. S&P affirmed the short-term issue ratings for these entities at A-1+. These entities are still rated Aaa and AAA by Moody’s and Fitch rating agencies. S&P had formerly issued a credit rating of AAA for the United States of America and on the related governmental entities. Although the credit ratings were lowered on government-related issues held by the District, they remain compliant with the District’s investment policy. Concentration of Credit Risk. The District places no limit on the amount the District may invest in any one issuer, rather investments are governed by the objectives of preservation and safety of principal, liquidity, and yield. In addition, the investment portfolio is diversified in terms of investment instruments, maturity scheduling, and financial institutions to reduce risk of loss resulting from over-concentration of assets in a specific class of investments, specific maturity, or specific issuer. More than 5% of the District’s investments are in commercial paper issued by Rabo Bank USA (8.6%), FCAR Owner Trust CP (5.2%), ING Funding (5.2%), Natixis US Financial (5.2%). Interest Rate Risk. In accordance with State law and the District’s investment policies, the District does not purchase any investments with maturities greater than five (5) years unless the investment’s maturity is matched to cash flow needs of long-term liabilities. The investment maturities in the following table reflect the maturity date of the investments in each category. Some investments are callable (redeemable) by the issuer on specified dates prior to the stated maturity date. The District uses its investments in the investment pools to further mitigate interest rate risk. The District’s investments at June 30, 2012 are shown in the table on the following page:




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A. DEPOSITS AND INVESTMENTS (continued)

Investment Type Fair Value Less than 1 1 to 2 2 to 4 10+U.S. Agencies $ 7,186,654 $ 5,183,154 $ - $ 2,003,500 $ - Municipal Bonds/Notes 69,146,240 41,879,913 22,258,682 2,178,986 2,828,659Commercial Paper 110,979,740 110,979,740 - - - Certificates of Deposit 994,610 744,188 250,422 - - Investments Subtotal 188,307,244 158,786,995 22,509,104 4,182,486 2,828,659Investment Pools 101,976,488 101,976,488 - - - Total Investments andInvestment Pools $ 290,283,732 $ 260,763,483 $ 22,509,104 $ 4,182,486 $ 2,828,659

Investment Maturities in Years

Securities Lending The District participates in a securities lending program as a means to augment income. The program is run in accordance with a contract between the District and its custodian and complies with the PFIA. Securities are lent to select brokerage firms for which collateral is received at 102% of the fair value of such investments during the period of the loan. Collateral may be cash or pledged securities, which are obligations of governmental entities or guaranteed by governmental entities as described in the PFIA. Any collateral received cannot be pledged or sold by the District. Maturities of investments made with the collateral generally match the length of the loan, as cash collateral is invested in overnight money market type funds. Securities lent during the year were limited to agency bonds and discount notes. There is no limit on the amount of securities that can be on loan. All lending transactions for the year ended June 30, 2012, occurred on an overnight basis and cash collateral was invested in overnight money market type funds. All security loans can be terminated on demand by either the District or by the borrower. The District’s contract with the lending agent requires the agent to indemnify the District against loss if the borrower fails to return the underlying security and the collateral is insufficient to replace the loaned securities. At June 30, 2012, the District had no securities on loan, and therefore, no credit risk existed at the date of the balance sheet.




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




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D. INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS The composition of interfund balances as of June 30, 2012 is as follows:

Receivable Fund Payable Fund Amount

General Fund Nonmajor Governmental Funds $ 3,340,427

General Fund Capital Projects Funds 1,722,211General Fund Enterprise Funds 816,604General Fund Internal Service Funds 386,567

General Fund Debt Service Fund 550General Fund Fiduciary Funds 98,459

Debt Service Fund General Fund 5,762,588Capital Projects Funds General Fund 116,494Capital Projects Funds Internal Service Funds 37,631

Nonmajor Governmental Funds General Fund 3,554,634Nonmajor Governmental Funds Nonmajor Governmental Funds 2,734,147Nonmajor Governmental Funds Capital Projects Funds 4,199

Nonmajor Governmental Funds Enterprise Funds 1,229Internal Service Funds General Fund 3,084,931Internal Service Funds Capital Projects Funds 1,847

Internal Service Funds Nonmajor Governmental Funds 749,145Internal Service Funds Enterprise Funds 26,364Internal Service Funds Internal Service Funds 2,486

Enterprise Funds Nonmajor Governmental Funds 14,489Enterprise Funds Internal Service Funds 357,614Enterprise Funds General Fund 765,697

Fiduciary Fund Nonmajor Governmental Funds 7,699Fiduciary Fund Fiduciary Fund 5,645

Total $ 23,591,657

The District operates payroll and accounts payable clearing bank accounts that are recorded in the General Fund. Of the amounts due to the General Fund, $2,381,418 reflects payroll and accounts payable transactions that were recorded prior to June 30, 2012, but not yet transferred from the other funds. Another $1,967,558 is a loan from the General Fund to the Nonmajor Governmental Funds to cover expenditures that have not yet been reimbursed by various grants. The amount due to the General Fund from Enterprise Funds consists of a $684,219 loan to the Community Education Enterprise Fund to fund the purchase of a building, which is not expected to be repaid within the next fiscal year. The amount owed by the Capital Projects fund to the General Fund consists mainly of reclassifications of expenditures related to the 2011 Bond




58

D. INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS (continued) projects which were not issued prior to fiscal year end. The amount due to Debt Service, $5,762,588 represents the interest and sinking portion of the June 2012 tax collections deposited to the General Fund. Of the amounts due to the Nonmajor Governmental Funds, $2,837,177 reflects the amounts owed by the General Fund to the Education Jobs Fund. The District has several bank accounts established at its depository bank; however, multiple funds can share one bank account. Due to the complexity and timing of various banking transactions, an individual fund may initially show a negative cash balance at year end, but the overall total for funds sharing the account is positive. At the end of the year, loans are established between funds sharing the same bank account to cover individual negative cash balances. Of the receivable amounts posted to the General Fund, Capital Projects, Nonmajor Governmental, Enterprise, and Internal Service Funds, $3,857,458 represents loan balances between these funds. Of the amounts owed to Internal Service Funds, $3,625,128 represents amounts related to insurance coverage. The remaining receivable balance of $753,900 is a combination of charges for various services provided by Internal Service Funds of the District and miscellaneous interfund transactions. All remaining balances resulted from the time lag between the dates that (1) interfund goods and services are provided or reimbursable expenditures occur, (2) transactions are recorded in the accounting system, and (3) payments between funds are made.




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D. INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS (continued) Interfund transfers are defined as “flow of assets without equivalent flows of assets in return and without requirement of repayment.” Interfund transfers for the year ending June 30, 2012 were as follows:

General Internal Nonmajor CapitalTransfers In Fund Service Governmental Enterprise Projects Total

General Fund $ - $ - $ 250,652 $ 47,652 $ 27,419 $ 325,723Capital Projects 122,000 - - - - 122,000Nonmajor Governmental 115,224 - 40,404 - - 155,628Internal Service 843,000 2,737,133 - - - 3,580,133Debt Service 379,566 - - - - 379,566

Total Transfers In/Out $ 1,459,790 $ 2,737,133 $ 291,056 $ 47,652 $ 27,419 $ 4,563,050

Transfers Out

In the fund financial statements, transfers out of the General Fund into the Capital Projects Fund are for building renovations and major maintenance projects. Transfers into the Debt Service fund are to set aside amounts to fund future principal requirements. Transfers from the General Fund into Nonmajor Governmental Funds supplemented the reimbursement of teachers for supplies. Transfers into the Internal Service Funds are to accumulate funds to purchase a new accounting package to replace older legacy systems and to reimburse the funds for the replacement of projector bulbs. Transfers out of the Nonmajor Governmental Funds consist of amounts transferred to the General Fund from the Campus Activity Fund to supplement various purchases. Transfers out of the Internal Service Funds are to establish a separate fund to track costs related to the District’s network. Also, transfers out of the Enterprise Fund into the General Fund are for costs associated with the rental of campus facilities by outside vendors.




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E. CAPITAL ASSET ACTIVITY Capital asset activity for the District’s governmental activities, including internal service funds, for the year ended June 30, 2012, was as follows:

Completed Beginning Capital Ending

Balance Additions Projects Disposals Balance Nondepreciable Capital AssetsLand $ 84,028,681 $ 67,139 $ - $ - $ 84,095,820Construction in Progress 46,052,339 53,534,276 (18,098,430) - 81,488,185

Subtotal Nondepreciable Assets 130,081,020 53,601,415 (18,098,430) - 165,584,005

Depreciable/Amortizable Capital AssetsBuildings and Improvements 1,452,154,988 6,973,876 18,098,430 - 1,477,227,294

Furniture and Equipment 50,116,231 3,646,645 - (164,872) 53,598,004 Subtotal Depreciable/

Amortizable Assets 1,502,271,219 10,620,521 18,098,430 (164,872) 1,530,825,298

Totals at Historical Cost 1,632,352,239 64,221,936 - (164,872) 1,696,409,303

Less Accumulated Depreciation/Amortization for:Buildings and Improvements (369,651,613) (47,447,277) - - (417,098,890)

Furniture and Equipment (30,288,066) (4,112,966) - 128,464 (34,272,568)Total Accumulated Depreciation/Amortization (399,939,679) (51,560,243) - 128,464 (451,371,458)

Governmental Activities Capital Assets, Net $ 1,232,412,560 $ 12,661,693 $ - $ (36,408) $ 1,245,037,845




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E. CAPITAL ASSET ACTIVITY (continued) Capital asset activity for the District’s business-type activities for the year ended June 30, 2012, was as follows:

Completed Beginning Capital Ending

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

Subtotal Nondepreciable Assets 2,547,600 - - - 2,547,600

Depreciable Capital AssetsBuildings and Improvements 9,873,903 9,235 - - 9,883,138

Furniture and Equipment 197,789 8,210 - - 205,999 Subtotal Depreciable Assets 10,071,692 17,445 - - 10,089,137

Totals at Historical Cost 12,619,292 17,445 - - 12,636,737

Less Accumulated Depreciation for:Buildings and Improvements (2,223,413) (376,623) - - (2,600,036)Furniture and Equipment (87,881) (32,371) - - (120,252)

Total Accumulated Depreciation (2,311,294) (408,994) - - (2,720,288)

Business - Type Activities Capital Assets, Net $ 10,307,998 $ (391,549) $ - $ - $ 9,916,449




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E. CAPITAL ASSET ACTIVITY (continued) Depreciation and amortization expense, excluding internal service funds, was charged to governmental functions as follows: Instruction $ 30,940,691Instructional Resources and Media Services 2,687,504 Curriculum Development and Instructional Staff Development 8,410 Instructional Leadership 34,351 School Leadership 1,496,134 Guidance, Counseling and Evaluation Services 446,397 Social Work Services 10,977 Health Services 285,667 Student (Pupil) Transportation 2,213,096 Food Services 2,674,788 Cocurricular/Extracurricular Activities 6,125,540 General Administration 75,712 Plant Maintenance and Operations 3,008,958 Security and Monitoring Service 77,526 Data Processing Services 310,523 Community Services 2,782 Total Governmental Funds $ 50,399,056

Depreciation/Amortization on capital assets held by the District's Internal Service Funds is charged to the various functions based on their usage of the assets 1,161,187

Total Depreciation/Amortization Expense - Governmental Activities $ 51,560,243

Total Depreciation/Amortization Expense - Business - Type Activities $ 408,994

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F. BONDS AND NOTES PAYABLE Bonded indebtedness of the District is reflected in the Statement of Net Assets. Current requirements for principal and interest expenditures are accounted for in the Debt Service Fund. A summary of changes in bonds and notes (“bonds”) payable for the year ended June 30, 2012 is as follows:

Original Interest Description Balance Rates

Unlimited Tax School Building Bonds - Series 1999 $ 211,000,000 5.25-6.50%

Unlimited Tax School Building Bonds - Series 2004 300,000,000 3.00-5.00%

Unlimited Tax Refunding Bonds - Series 2004 189,435,000 2.00-5.25%

Unlimited Tax Refunding Bonds - Series 2004* 308,384 4.02-4.19%

Unlimited Tax School Building Bonds - Series 2005 149,000,000 3.50-5.00%



Unlimited Tax School Building Bonds - Series 2007A* 71,590,965 3.80-4.27%

Unlimited Tax School Building Bonds - Series 2007A 417,000,000 3.80-4.39%

Limited Tax Maintenance Notes - Series 2010 37,545,000 5.24%

$ 1,747,254,349

* Capital appreciation bonds ** Additions to capital appreciation bonds include interest accretion for the year ended June 30, 2012. The capital appreciation bonds are included in bonds payable at their accreted value, for principal amounts due as of June 30, 2012.




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Beginning Ending Balance Additions** Payments Balance

$ 10,975,000 $ - $ - $ 10,975,000

163,695,000 - 6,850,000 156,845,000

151,335,000 - 17,975,000 133,360,000

874,377 133,260 - 1,007,637

111,200,000 - 3,055,000 108,145,000

71,625,000 - - 71,625,000

246,795,000 - - 246,795,000

65,305,996 2,027,503 18,805,000 48,528,499

417,000,000 - - 417,000,000

37,545,000 - - 37,545,000

$ 1,276,350,373 $ 2,160,763 $ 46,685,000 $ 1,231,826,136




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F. BONDS AND NOTES PAYABLE (continued) The general obligation bonds mature and the capital appreciation bonds accrete in value through 2038 as follows:

Year Ending June 30, Principal Interest Total

2013 $ 48,035,000 $ 58,590,499 $ 106,625,4992014 41,475,000 57,096,593 98,571,593 2015 42,975,000 55,513,249 98,488,249 2016 48,225,000 53,892,231 102,117,231 2017 46,260,000 51,864,481 98,124,481

2018-2022 219,360,000 228,493,990 447,853,990 2023-2027 258,235,000 171,276,271 429,511,271 2028-2032 304,045,000 92,259,310 396,304,310 2033-2037 196,070,000 29,088,278 225,158,278

2038 30,170,000 1,508,500 31,678,500 1,234,850,000 $ 799,583,402 $ 2,034,433,402

Less interest accretionin future years 3,023,864

Total principal due at June 30, 2012 $ 1,231,826,136

There are a number of limitations and restrictions contained in the general obligation bond indenture. The District is in compliance with all significant limitations and restrictions as of June 30, 2012. Summary information for the capital appreciation bonds is as follows:

Original Accreted Amount Value

Series Outstanding June 30, 2012

Unlimited Tax Refunding Bonds - Series 2004 $ 308,384 $ 1,007,637Unlimited Tax School Building Bonds - Series 2007A 39,714,306 48,528,499Total $ 40,022,690 $ 49,536,136




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F. BONDS AND NOTES PAYABLE (continued) In prior years, the District defeased certain general obligation and other bonds by placing the proceeds of new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the District's financial statements. As of June 30, 2012, $198,225,000 of refunded bonds outstanding are considered to be defeased. Subsequent to year end, the District issued $180,610,000 in Unlimited Tax School Building and Refunding Bonds. The bonds, dated July 1, 2012, will refund $83,920,000 in existing debt obligations and provide $114,700,000 to fund various construction projects. G. ACCUMULATED STATE PERSONAL AND SICK LEAVE BENEFITS Upon separation from the District, employees with ten consecutive years of service in the District and eligible to receive benefits under the Teacher Retirement System of Texas shall be entitled to a lump sum cash payment for any unused accrued State leave or local leave earned in the District. The District implemented this as an incentive to retain employees. Employees receive reimbursement equivalent to one-half the daily rate of pay at the time of their separation from the District up to a maximum of $40 per day for up to 80 days, and one-fourth the daily rate of pay to a maximum of $20 per day for days in excess of 80 for days earned through June 30, 2005. For days earned after June 30, 2005, employees will receive reimbursement equivalent to one half the daily rate of pay at the time of their separation from the District up to a maximum of $75 per day up to 80 days and one fourth the daily rate of pay up to a maximum of $65 per day for days in excess of 80. A summary of changes in the accumulated State personal and sick leave liability follows:

Balance July 1, 2011 $ 3,462,947Additions - New Entrants and Salary Increments 951,636Deductions - Payments to Participants (812,657)Balance June 30, 2012 $ 3,601,926

Current Portion $ 497,555




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H. DEFINED BENEFIT PENSION PLAN The following disclosures regarding the District’s participation in the Teacher Retirement System of Texas (TRS) are presented below. Plan Description The District contributes to TRS, a cost-sharing multiple-employer defined benefit pension plan. TRS administers retirement and disability annuities and death and survivor benefits to employees and beneficiaries of employees of the public school system of Texas. It operates primarily under the provisions of the Texas Constitution, Article XVI, Section 67 and Texas Government Code, Title 8, Subtitle C. TRS also administers proportional retirement benefits and service credit transfers under Texas Government Code, Title 8, Chapter 803 and Chapter 805, respectively. The Texas state legislature has the authority to establish and amend benefit provisions of the pension plan and may, under certain circumstances grant special authority to the TRS Board of Trustees. TRS issues a publicly-available financial report that includes financial statements and required supplementary information for the defined benefit pension plan. That report may be obtained by writing to the TRS Communications Department, 1000 Red River Street, Austin, Texas 78701, by calling the TRS Communications Department at 1-800-223-8778, or by downloading the report from the TRS Internet web site, www.trs.state.tx.us, under the TRS publications heading. Funding Policy State law provides for a member contribution rate of 6.4% for fiscal years 2012, 2011, and 2010, and a state contribution rate of 6.00% for fiscal year 2012 and 6.644% for fiscal years 2011 and 2010. The contribution rate is effective for the TRS fiscal year which begins September 1st. In certain instances the reporting district is required to make all or a portion of the State’s and/or the member’s contribution and on the portion of employee salaries that exceed the statutory minimum. Contribution requirements are not actuarially determined but are legally established each biennium pursuant to the following state funding policy: (1) The state constitution requires the legislature to establish a member contribution rate of not less than 6.0% of the member’s annual compensation and a state contribution rate of not less than 6.0% and not more than 10.0% of the aggregate annual compensation of all members of TRS during the fiscal year, and (2) a state statute prohibits benefit improvements or contribution reductions if, as a result of the particular action, the time required to amortize TRS’ unfunded actuarial liabilities would be increased to a period that exceeds 31 years, or, if the amortization period already exceeds 31 years, the period would be increased by such action. The District has made 100% of its required contributions. State contributions for fringe benefits and salaries to TRS made on behalf of the District’s employees for the last three fiscal periods and amount paid by the District for additional state contributions on the portion of the employees’ salaries exceeding the statutory minimum are on the following page:




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H. DEFINED BENEFIT PENSION PLAN (continued)

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

2012 2011 2010

State TRS On-Behalf Contributions $ 17,986,721 $ 20,067,974 $ 19,754,893District Contributions for

Above Statutory Minimum 3,984,835 4,688,500 4,779,476

$ 21,971,556 $ 24,756,474 $ 24,534,369

Revenue and expenditures equal to the amount paid by the State of Texas for on-behalf fringe benefits were recognized during the fiscal year. I. SCHOOL DISTRICT RETIREE HEALTH PLAN Plan Description The District contributes to the Texas Public School Retired Employees Group Insurance Program (TRS-Care), a cost-sharing multiple employer defined benefit postemployment health care plan administered by TRS. TRS-Care provides health care coverage for certain persons (and their dependents) who retired under TRS. The statutory authority for the program is Texas Insurance Code, Chapter 1575. Section 1575.052 grants the TRS Board of Trustees the authority to establish and amend basic and optional group insurance coverage for participants. The TRS issues a publicly available financial report that includes financial statements and supplementary information for TRS-Care. That report may be obtained by visiting the TRS web site at www.trs.state.tx.us, by writing to the Communications Department of the Teacher Retirement System of Texas at 100 Red River Street, Austin, TX 78701, or by calling 1-800-223-8778.




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I. SCHOOL DISTRICT RETIREE HEALTH PLAN (continued) Funding Policy Contribution requirements are not actuarially determined but are established each biennium by the Texas Legislature. Texas Insurance Code Sections 1575.202, 203, and 204 establish state, active employee, and public school contributions, respectively. The State of Texas and active public school employee contribution rates were 1.0% and 0.65% of public school payroll, respectively, with school districts contributing a percentage of payroll set at 0.55% for fiscal years 2012, 2011, and 2010. Per Texas Insurance Code, Chapter 1575, the public school contribution may not be less than 0.25% or greater than 0.75% of the salary of each active employee of the public school. The contributions to TRS-Care made by the State, active employees, and the District for fiscal years 2012, 2011, and 2010 equaled the required contributions and are as follows:

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

2012 2011 2010

State TRS-Care On-Behalf Contributions $ 3,841,422 $ 3,952,347 $ 3,951,860Active Member's Contributions 2,496,924 2,569,026 2,568,709District Contributions to TRS Care 2,112,782 2,173,791 2,173,523

$ 8,451,128 $ 8,695,164 $ 8,694,092

Revenue and expenditures equal to the amount paid by the State of Texas for on-behalf fringe benefits were recognized during the fiscal year. Medicare Part D Federal legislation enacted in January 2006 established prescription drug coverage for Medicare beneficiaries known as Medicare Part D. One provision of the law allows TRS-Care to receive retiree drug subsidy payments from the federal government to offset certain prescription drug expenditures for eligible participants. These payments totaled $732,242, $1,077,307, and$1,002,556 for fiscal years 2012, 2011, and 2010, respectively. Revenue and expenditures equal to the amount paid by the federal government were recognized during the fiscal year.




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I. SCHOOL DISTRICT RETIREE HEALTH PLAN (continued) Early Retiree Reinsurance Program The Early Retirement Reinsurance Program (ERRP) is a provision of the Patient Protection and Affordable Care Act that provides reimbursement to plan sponsors for a portion of the cost of providing health benefits to retirees between the ages of 55 through 64. These payments totaled $952,543 for retirees from the District for fiscal years 2012. Revenue and expenditures equal to the amount paid by the federal government were recognized during the fiscal year. J. OTHER POST EMPLOYMENT BENEFITS (OPEB) The District also offers medical, dental, and life insurance coverage to certain retirees who have continued their coverage with the District’s insurance plans since their retirement. The option to continue coverage is no longer offered; thereby, participation in the plan is limited to those employees who retired prior to August 31, 2004. Plan Description The plan is a single employer plan offering continued medical coverage under the District’s medical insurance for retirees and their dependents with the retiree paying both the employee and District contributions. If Medicare coverage is available, the District’s third party administrator, Blue Cross/Blue Shield of Texas, will coordinate coverage with Medicare acting as the primary insurer. The plan does not issue a separate set of financial statements.




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J. OTHER POST EMPLOYMENT BENEFITS (OPEB) (continued) Annual OPEB Cost The District’s annual OPEB cost and net OPEB obligation for the years ended June 30, 2012, 2011, and 2010 are as follows:

June 30, June 30, June 30,2012 2011 2010

Annual Required Contribution (ARC) $ 310,863 $ 306,786 $ 241,996Interest on Prior Year Net OPEB (Benefit)/Obligation 2,973 - - Adjustment to the ARC (3,903) - - Annual OPEB Cost 309,933 306,786 241,996Retiree Claims Paid (251,201) (214,023) (268,638) Increase/(Decrease) in Net OPEB Obligation $ 58,732 92,763 (26,642)

Net OPEB (Benefit)/Obligation at June 30 $ 125,549 $ 66,817 $ (25,946)

Percentage of ARC Contributed 81.1% 69.8% 111.0%

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

June 30, June 30, June 30, 2012 2011 2010

Schedule of Funding ProgressActuarial Accrued Liability $ 4,783,344 $ 4,783,344 $ 3,805,781Actuarial Value of Plan Assets - - - Funded Ratio (actuarial value of plan assets/AAL) 0% 0% 0%

Unfunded Actuarial Accrued Liability $ 4,783,344 $ 4,783,344 $ 3,805,781

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




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J. OTHER POST EMPLOYMENT BENEFITS (OPEB) (continued) Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the substantive plan (as understood by the District and its plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the District and plan members at that time. The actuarial methods and assumptions used include techniques that are designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. In the June 30, 2012 actuarial valuation, the projected unit credit cost method was used. The actuarial assumptions used include a 4.45% rate compounded annually for an unfunded plan, claims costs for future years equal the costs for the current year adjusted for assumed healthcare cost trends beginning at a rate of 10.0% for fiscal year 2012, an inflation rate of 3.5% annually, and a 3.0% increase in claims per year per member regardless of their age. A closed amortization period of 30 years was used to compute the District’s Annual Required Contribution. Since the plan is closed to new members, there is no annual covered payroll costs associated with the plan. K. RISK MANAGEMENT The District is exposed to various risks or torts; theft of, damage to, and destruction of assets; injuries to employees; and natural disasters. During fiscal year 2012, the District purchased insurance coverage for property, general liability, fleet liability, errors and omissions, crime, various cyber liability and network insurance coverage, extortion, equipment breakdown coverage, storage tank liability, and police professional liability. Internal Service Funds purchased self-funded unemployment compensation insurance, employee health stop-loss coverage, and workers’ compensation excess coverage. There has been no significant reduction in insurance coverage from the prior year by major category of risk. There were four instances in fiscal year 2011-12 that the District had insurance settlements that reached the amount of its stop-loss coverage limit. There were two insurance settlements that reached the stop-loss coverage limit in each of the prior two years. Detailed information on the major categories of risk is as follows:




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

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

Liability Estimates Payments Liability

2010-11 $ 3,859,336 $ 56,222,602 $ (55,580,950) $ 4,500,9882011-12 $ 4,500,988 $ 53,820,138 $ (54,473,126) $ 3,848,000




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



2010-11 $ 236,611 $ 2,960,936 $ (2,955,617) $ 241,9302011-12 $ 241,930 $ 3,187,014 $ (3,116,944) $ 312,000

Workers’ Compensation The District’s workers’ compensation program is self-funded through an Internal Service Fund. The District carries excess coverage of $350,000 specific stop-loss and aggregate stop-loss of $5,000,000. Amounts payable to the Workers’ Compensation Fund are based on actuarial estimates of the amounts necessary to pay prior and current period claims and to establish a reserve for catastrophic losses. A liability for a claim is established if information indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss is reasonably estimable. A reconciliation of changes in the aggregate liabilities for workers’ compensation claims for the prior and current fiscal period is presented below:



2010-11 $ 2,007,522 $ 1,979,373 $ (1,652,786) $ 2,334,1092011-12 $ 2,334,109 $ 957,432 $ (1,608,373) $ 1,683,168

The current portion of workers’ compensation claims is $449,019.




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L. CHANGES IN LONG-TERM LIABILITIES Long-term activity for the year ended June 30, 2012, was as follows:

Due

Beginning Ending Within Governmental Activities: Balance Additions Reductions Balance One Year

Bonds and Notes Payables: General Obligation Bonds $ 1,210,170,000 $ - $ 27,880,000 $ 1,182,290,000 $ 29,230,000

Capital Appreciation Bonds* 66,180,373 2,160,763 18,805,000 49,536,136 18,805,000 Plus Amounts Deferred:

On Refunding (24,637,195) - (1,836,077) (22,801,118) - Issuance Premiums 77,536,731 - 4,017,385 73,519,346 -

Total Bonds and Notes Payable 1,329,249,909 2,160,763 48,866,308 1,282,544,364 48,035,000 Other Liabilities: Workers' Compensation

Accrued Claims Liability 2,334,109 957,432 1,608,373 1,683,168 449,019 Capital Lease Payable 84,723 - 84,723 - - Compensated Absences 3,462,947 951,636 812,657 3,601,926 497,555 Net OPEB Obligation/(Benefit) 66,817 309,933 251,201 125,549 - Total Other Liabilities 5,948,596 2,219,001 2,756,954 5,410,643 946,574 Total Governmental Activities

Long-term Liabilities $ 1,335,198,505 $ 4,379,764 $ 51,623,262 $ 1,287,955,007 $ 48,981,574

* Additions to capital appreciation bonds consist of interest accretion for the year ended June 30, 2012. The compensated absence liability is liquidated using the fund where the employee’s salary is charged. The majority of the District’s salaries are accounted for in the General Fund.




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M. DEFERRED/UNEARNED REVENUE Deferred revenue in the District’s governmental funds at June 30, 2012 consisted of the following:

Debt NonmajorGeneral Service Governmental

Fund Fund Funds Total

Net Tax Revenue $ 10,153,751 $ 3,127,336 $ - $ 13,281,087National Breakfast and

Lunch Program - - 892,814 892,814Title VI, Part A - - 32,475 32,475

Initiatives - - 141,516 141,516State Textbook - - 98,893 98,893Misc State Grants - - 1,217 1,217Coalition of Essential Schools - - 1,070 1,070Asia Society - - 12,381 12,381Misc Local - - 5,566 5,566Other 143,350 - - 143,350Total $ 10,297,101 $ 3,127,336 $ 1,185,932 $ 14,610,369

The District’s proprietary funds reported unearned revenue as of June 30, 2012 as follows:

Internal Service Enterprise Funds Fund Total

Community Education $ - $ 41,678 $ 41,678PPCD - 21,881 21,881NEAT - 8,110 8,110Health Insurance Premiums 3,625,128 - 3,625,128Total $ 3,625,128 $ 71,669 $ 3,696,797




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N. DUE FROM OTHER GOVERNMENTS The District participates in a variety of federal and state programs from which it receives grants to partially or fully finance certain activities. In addition, the District receives entitlements from the State through the School Foundation and Per Capita Programs. Amounts due from federal and state governments as of June 30, 2012 are presented on the following page. All federal grants shown on the following page are passed through the TEA and are reported as Due From Other Governments.

General Nonmajor

GovernmentalInternal Service Enterprise Total

State Entitlements $ 31,489,682 $ 53,953 $ - $ - $ 31,543,635State Pass Through Grants - 5,606,438 - - 5,606,438Federal Grants 47,046 311,855 - - 358,901Other 3,930,693 1,435 338 12,660 3,945,126

Total $ 35,467,421 $ 5,973,681 $ 338 $ 12,660 $ 41,454,100

O. RECEIVABLES Receivables as of June 30, 2012 for the District’s individual major funds and other nonmajor governmental funds in the aggregate, including the applicable allowances for uncollectible accounts, are as follows:

Taxes $ 21,638,737 $ 7,053,883 $ - $ - $ 28,692,620Due From Other Governments 35,467,421 - - 5,973,681 41,441,102Interest 290,891 59,644 107,917 19,102 477,554Other Receivables 229,997 - 612 18,708 249,317

Gross Receivables 57,627,046 7,113,527 108,529 6,011,491 70,860,593

Less: Allowance for Uncollectible (1,791,838) (551,883) - - (2,343,721)Net Total Receivables $ 55,835,208 $ 6,561,644 $ 108,529 $ 6,011,491 $ 68,516,872

Nonmajor Governmental

Funds TotalGeneralDebt

ServiceCapital Projects




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O. RECEIVABLES (continued) The majority of the receivable balance is attributable to a $975,380 receivable in the ROCIP fund for estimated amounts due from the insurance carrier for the difference between amounts paid into the stop-loss fund for its portion of aggregate claims and the amount of actual claims plus various administrative costs incurred. A series of actuarial studies will be performed to determine total claim costs plus incurred but not reported costs (IBNR). The last construction project whose insurance coverage was maintained under the District’s ROCIP ended in August 2009. Receivables as of June 30, 2012 for the District’s proprietary-type funds in the aggregate are as follows:

Interest $ - $ 67,278 $ 67,278Due From Other Governments 12,660 338 12,998Other Receivables 158,255 1,087,646 1,245,901Gross Receivables $ 170,915 $ 1,155,262 $ 1,326,177

Internal Service Funds Total

Enterprise Funds

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

Debt Capital NonmajorGeneral Service Projects Governmental Fund Fund Fund Funds Total

Property Taxes $ 280,204,534 $ 97,751,083 $ - $ - $ 377,955,617Penalties, Interest and Other

Tax Related Income 1,888,918 578,098 - - 2,467,016Investment Income 553,743 535,522 1,862,972 44,170 2,996,407Food Sales - - - 13,053,012 13,053,012Tuition and Fees 696,728 - - - 696,728Co-curricular Student Activities 1,816,293 - - - 1,816,293Other 1,577,062 - 19,750 6,991,332 8,588,144Total $ 286,737,278 $ 98,864,703 $ 1,882,722 $ 20,088,514 $ 407,573,217




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

Internal Service Funds

Enterprise Funds Total

User Charges $ 69,856,808 $ - $ 69,856,808Tuition and Fees - 7,465,035 7,465,035Rent - 698,479 698,479Athletics - 694,333 694,333Enterprising Activities - 67,364 67,364Other Revenue from Local Sources 386,274 299,273 685,547Total $ 70,243,082 $ 9,224,484 $ 79,467,566

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

CONTINGENCIES The District participates in numerous state and federal grant programs which are governed by various rules and regulations of the grantor agencies. Costs charged to the respective grant programs are subject to audit and adjustment by the grantor agencies; therefore, to the extent that the District has not complied with the rules and regulations governing the grants, refunds of any money received may be required and the collectibility of any related receivable may be impaired. In the opinion of the District, there are no significant contingent liabilities relating to compliance with the rules and regulations governing the respective grants; therefore, no provision has been recorded in the accompanying basic financial statements for such contingencies. At June 30, 2012, the District was committed under the terms of various construction contracts for new school facilities and the remodeling of existing facilities for $89,684,216.




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

As discussed in footnote III.A, encumbrance accounting is used to ensure budgetary control and accountability. At June 30, 2012, the amount of encumbrances expected to be honored upon performance of the service of delivery of merchandise by vendors in the subsequent year are as follows: General Fund $ 2,836,944Nonmajor Governmental Funds 1,206,661Enterprise Funds 253,970Internal Service Funds 1,139,070

$ 5,436,645

S. SHARED SERVICE ARRANGEMENTS The District participates in the North East Independent School District Regional Day School Program for the Deaf (NEISD RDSPD), a shared service arrangement, with four member Districts: Alamo Heights ISD, East Central ISD, Comal ISD, and Judson ISD. The District is acting as the fiscal agent for the parties involved. The NEISD RDSPD provides services to students from birth through 21 years of age who are auditorily impaired. Funding for the NEISD RDSPD is provided by the TEA and by the member districts at a per pupil cost of $10,500. Revenue from the respective member districts, including the District’s contribution, is as follows: North East ISD $ 395,184Judson ISD 150,000East Central ISD 12,500Alamo Heights ISD 62,500Comal ISD 12,500

$ 632,684

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




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T. ARBITRAGE The Federal Tax Reform Act of 1986 enacted section 148(f) of the Internal Revenue Code, relating to arbitrage rebate requirements, which generally provides that in order for interest on any issue of obligation to be excluded from gross income the issuer must rebate to the United States the sum of (1) the excess of the amount earned on all “non-purpose investments” acquired with “gross proceeds” of the issue over the amount which would have been earned if such investments had been invested at a yield equal to the yield on the issue, and (2) the earnings on such excess earnings. The Act requires issuers of tax-exempt debt to make payments to the United States Treasury for investment income received at yields that exceed the issuer’s tax exempt borrowing rates. The Treasury requires payment for each issue every five years. The estimated liability is updated annually for all tax-exempt issuances or changes in yields until such time payment of the calculated liability is due. As of June 30, 2012, the District had no arbitrage liability for applicable bond issues calculated to be due to the IRS. This amount is determined based on current investment yields and is subject to change prior to the due date of the rebate. The due date of the rebate is five years from the bond’s date of issuance. The District considers arbitrage a revenue-generated liability and has adjusted interest earnings for the annual change in the liability.




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U. FUND BALANCE The fund balance as of June 30, 2012 consists of the following amounts:

Debt Capital NonmajorGeneral Service Projects Government Fund Fund Fund Funds Total

Nonspendable:Inventory $ 2,174,173 $ - $ - $ 959,239 $ 3,133,412Scholarships - - - 200,000 200,000

Restricted:Debt Service - 82,716,079 - - 82,716,079Capital Acquisition - - 43,110,047 - 43,110,047Child Nutrition - - - 8,094,777 8,094,777Medicaid - - - 672,234 672,234Scholarships 31,827 31,827

Committed:Campus Funds - - - 2,602,907 2,602,907HEB Grant - - - 77,249 77,249

Assigned:Debt Service - 2,048,563 - - 2,048,563

Unassigned: 114,579,802 - - - 114,579,802Total $ 116,753,975 $ 84,764,642 $ 43,110,047 $ 12,638,233 $ 257,266,897

Committed fund balance within the Nonmajor Governmental funds represents fund balance in the Campus Activity fund which are funds raised by the campus for the campuses sole use. Also committed in the Nonmajor Governmental funds is the fund balance for a local grant from HEB, Inc., that did not have specific grant requirements but for which the District has committed to improve education in specific programs. Assigned fund balance reported within the debt service fund represent amounts that are not collected from the interest and sinking fund tax levy and represent amounts set aside for debt maturing in future years. V. SUBSEQUENT EVENTS Subsequent to year end, the District issued $180,610,000 in Unlimited Tax School Building and Refunding Bonds. The bonds, dated July 1, 2012, will refund $83,920,000 in existing debt obligations and provide $114,700,000 to fund various construction projects, technology upgrades, and the purchase of school buses.

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85

Combining and Individual Fund Statements and Schedules

86



Nonmajor Governmental Funds

Fund Descriptions

87

SPECIAL REVENUE FUNDS The Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than major capital projects) that are legally restricted to expenditures for specified purposes. Elementary and Secondary Education Act (“ESEA”), Title IV, Part A – Safe and Drug Free Schools and Communities Act (Fund 204) These funds are provided as a result of the NCLB Act of 2001 and are to be used to develop age-appropriate comprehensive violence and drug/alcohol education prevention programs. This program is authorized under P. L. 107-110(84.186A) (U. S. Department of Education) ESEA, Title X, Part C – Education for the Homeless Children and Youth (Fund 206) These funds are to be used to account, on a project basis, for funds allocated to local educational agencies to enable schools to provide a variety of staff development and supplemental services, including in-service training, counseling, psychological services and tutoring. This program is authorized under P. L. 107-110, McKinney-Vento Homeless Education Assistance Improvement of 2001 as amended by NCLB Act of 2001, Title X, Part C. (84.196) (U. S. Department of Education) ESEA, Title I, Part A – Improving Basic Programs (Fund 211) These funds are to be used to account, on a project basis, for funds allocated to local educational agencies to enable schools to provide opportunities for children served to acquire the knowledge and skills contained in the challenging State content standards and to meet the challenging State performance standards developed for all children. This program is authorized under P. L. 107-110. (84.010A) (U. S. Department of Education) Adult Basic Education, Federal (Fund 220) These funds are to be used to account, on a project basis, for funds granted to provide or support programs for adult education and literacy services to adults who are beyond compulsory school age attendance, and do not have a high school diploma, or lack sufficient mastery of basic educational skills to function effectively in society, or are unable to speak, read or write the English language; and are not enrolled in school. Education services include basic educational skills (reading, writing, speaking and mathematics), English as a Second Language instruction, and secondary level competencies for acquisition of a high school diploma or equivalent. This includes sections 322, 326, and 353 under P. L. 91.230 as amended by P. L. 102.73, The National Literacy Act. (84.002A) (U. S. Department of Education)



Fund Descriptions

88

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



Fund Descriptions

89

ESEA, Title II, Part A - Teacher and Principal Training and Recruiting (Fund 255) These funds are used to provide financial assistance to LEAs to increase student academic achievement through improving teacher and principal quality and increasing the number of highly qualified teachers in classrooms and highly qualified principals and assistant principals in schools, and hold LEAs accountable for improving student academic achievement. This program is authorized under P. L. 107-110. (84.367A) (U. S. Department of Education) Title III, Part A - English Language Acquisition and Language Enhancement (Fund 263) These funds are used to account, on a project basis, for funds granted to improve the education of limited English proficient children, by assisting the children to learn English and meet challenging State academic content and student academic achievement standards. This program is authorized under P. L. 107-110. (84.365A) (U.S. Department of Education)

ARRA of 2009, Title XIV, State Fiscal Stabilization Fund (Fund 266)

This fund classification is to be used to account, on a project basis, for funds granted to improve basic programs authorized under by the Elementary and Secondary Education Act of 1965, as amended by the No Child Left Behind Act of 2001; the Individuals with Disabilities Education Act (IDEA); the Adult and Family Literacy Act; the Carl D. Perkins and Technical Education Act of 2006. This program is authorized under the American Recovery and Reinvestment Act (ARRA) of 2009, Title XIV. (84.394) Medicaid Administrative Claiming Program - MAC (Fund 272) These funds are used to account, on a project basis, for funds allocated to local education agencies for reimbursement of eligible administrative costs for activities attributed to the implementation of the Medicaid state plan. (93.778) Title II, Part D, Subpart 1 - Enhancing Education through Technology – ARRA (Stimulus) (Fund 279) These funds are used to account, on a project basis, for funds granted for the implementation and support of a comprehensive system that effectively uses technology in elementary and secondary schools to improve student academic achievement. This program is authorized under P. L. 107-110. (84.386) (U.S. Department of Education) (American Recovery and Reinvestment Act (ARRA) of 2009, Title VIII)



Fund Descriptions

90

ESEA, Title X, Part C – Education for the Homeless Children and Youth – ARRA (Stimulus) (Fund 280) These funds are to be used to account, on a project basis, for funds allocated to local educational agencies to enable schools to provide a variety of staff development and supplemental services, including in-service training, counseling, psychological services and tutoring. This program is authorized under P. L. 107-110, McKinney-Vento Homeless Education Assistance Improvement of 2001 as amended by NCLB Act of 2001, Title X, Part C. (84.387) (U. S. Department of Education). (American Recovery and Reinvestment Act (ARRA) of 2009, Title VIII) IDEA - Part B, Formula – ARRA (Stimulus) (Fund 283) These funds are to be used to account, on a project basis, for funds granted to operate educational programs for children with disabilities. (84.391) (U. S. Department of Education) (American Recovery and Reinvestment Act (ARRA) of 2009, Title VIII) IDEA- Part B, Preschool – ARRA (Stimulus) (Fund 284) These funds are to be used to account, on a project basis, for funds granted for preschool children with disabilities. This program is authorized under P. L. 105-17. (84.392) (U.S. Department of Education) (American Recovery and Reinvestment Act (ARRA) of 2009, Title VIII) ESEA, Title I, Part A – Improving Basic Programs – ARRA (Stimulus) (Fund 285) These funds are to be used to account, on a project basis, for funds allocated to local educational agencies to enable schools to provide opportunities for children served to acquire the knowledge and skills contained in the challenging State content standards and to meet the challenging State performance standards developed for all children. This program is authorized under P. L. 107-110. (84.389) (U. S. Department of Education) (American Recovery and Reinvestment Act (ARRA) of 2009, Title VIII) Education Jobs Fund (Fund 287) These funds are to be used to account, on a project basis, for funds granted to retain, recall, or rehire school-level employees, and to hire new school-level employees, in order to provide early childhood, elementary, or secondary educational and related services. (P.L. 111-226, Title I, Education Jobs Fund) (84.410) (U.S. Department of Education).



Fund Descriptions

91

Carol M. White Physical Education Program (Fund 288) These funds are used to initiate, expand, or enhance physical education programs, including after-school programs, for students in kindergarten through 12th grade. NASA Student Launch Initiative (Fund 288) These funds are used to engage students in a learning opportunity that involves design, construction, test, and launch of a reusable launch vehicle and science-related payload. The initiative is intended to encourage students to pursue careers in engineering or science-related fields. Statewide Longitudinal Data System (SLDS) (Fund 289) These funds are used to enable the accurate collection and reporting of classroom level student and teacher data to TEA through the Public Education Information Management System (PEIMS). Communities Putting Prevention to Work (Fund 289) These funds are used to improve school property for increasing physical activity of the proximate community. (American Recovery and Reinvestment Act (ARRA) of 2009, Title VIII) National Institute of Standard Technology (NIST) Summer Institute (Fund 289) These funds are used to send two middle school science teachers to participate in the NIST Summer Institute. The program increases teachers’ understanding of the subjects they teach, provides materials and resources to implement what they have learned in their own classrooms, increases teachers’ understanding of how scientific research is carried out and provides them the opportunity to develop an ongoing network with the scientists and engineers at NIST. Institute of Museums and Library Services (Fund 289) These funds are use to encourage libraries to challenge existing assumptions about how they operate and the services they provide. They also support the deployment, testing, and evaluation of promising and groundbreaking new tools, products, services, or organizational practices.



Fund Descriptions

92

Title VI, Part A, Summer School LEP & Advanced Placement Spanish Language (Fund 289) These funds are to be used to account, on a project basis, for funds granted for summer school programs for LEP students only if a bilingual program is part of the standard curriculum. Monies may be used to fund both required summer school and voluntary summer school LEP students. (84.369A) In addition, funds are also provided for the planning phase of a Middle School Advance Placement Spanish Language program. SSA IDEA-B, Discretionary (Fund 315) These funds are used to account, on a project basis, for funds used to support an Education Service Center (“ESC”), special education component, priority projects in secondary special education, and adaptive/assertive devices component through ESCs, private residential placements, state school student support, support of students in care and treatment or hospital facilities, enhanced Braille production, and other emerging needs. (84.027) (U. S. Department of Education) SSA IDEA-B, Deaf (Fund 316) These funds are used to account, on a project basis, for funds granted to provide educational programs for children with disabilities. This fund includes capacity building and improvement (sliver) deaf sub-grants. (84.027) (U. S. Department of Education) SSA IDEA-B, Preschool Deaf (Fund 317) These funds are used to account, on a project basis, for funds granted to preschool children with disabilities. This program is authorized under P.L. 105-17. (84.173) (U. S. Department of Education) Adult Basic Education (ABE) - State (Fund 381) These funds are to be used to account, on a project basis, for funds granted to provide or support programs for adult education and literacy services to adults 16 years of age and above, who do not have a high school diploma and are out of school. State Supplemental Visually Impaired (SSVI) (Fund 385) These funds are to be used to account, on a project basis, for funds granted to provide supplemental services for the visually impaired.



Fund Descriptions

93

Non-educational Community-Based Support (Fund 392) These funds are to be used to account, on a project basis for funds granted for the provision of non-educational community-based support services to students with disabilities who would remain or have to be placed in residential facilities for educational reasons without the provision of these services. The support services may include transportation, respite for the parents, case management, social work and in-home family support. (TEC 29.013) Life Skills Program (Fund 394) These funds are to be used to account, on a project basis, for funds granted to provide pregnant and parenting students the services needed to keep them in school until completion. (TEC 29.085) Advanced Placement Incentives (Fund 397) These funds are to be used to account, on a project basis, for funds awarded to school Districts under the Texas Advanced Placement Award Incentive Program, Chapter 28, Subchapter C, TEC. Student Success Initiative (Fund 404) These funds are to be used to account, on a project basis, for funds granted for teacher training and allocations to schools to implement scientific, research-based programs for students who have been identified as unlikely to achieve the third grade TAKS reading standard by the end of the third grade. Texas Science, Technology, Engineering and Math (T-STEM) Academy (Fund 409) These funds are to be used to account, on a project basis, for funds granted to support the design and implementation of a T-STEM Academy. This Academy is designed to increase student achievement by engaging students through innovative science and math instructional techniques. State Textbook Fund (Fund 410) These funds are used to account, on a project basis, for funds awarded to school districts under the textbook allotment. (TEC Chapter 31, Subchapter B)



Fund Descriptions

94

Technology Allotment (Fund 411) These funds are used to account, on a project basis, for funds awarded to purchase technological software or equipment that contributes to student learning, or to pay for training for educational personnel involved in the use of these materials. (TEC Chapter 32, Subchapter A) Master Reading Teacher Program (Fund 421) These funds are used to account, on a project basis, for stipends to school districts with Master Reading teachers who are certified according to the provisions in TEC 21.0481. District Award for Teacher Excellence (Fund 427) These funds are used to account, on a project basis, for funds awarded to provide a teacher incentive awards program that supports the establishment of district-wide goals and the implementation of a financial awards system for teachers who improve student achievement. Apprenticeship Training Program (Fund 429) These funds are used to account, on a project basis, a structured system of training to prepare people for occupations in skilled trades, crafts, and other occupations. The Apprenticeship Training Program combines on the job training under the supervision of experienced journey workers with related classroom instruction. Limited English Proficient (LEP) Student Success Initiative (Fund 429) These funds are used to account, on a project basis, for funds granted to schools to provide intensive programs of instruction for limited English-proficient (LEP) students and teacher training resources specific to instruction of LEP students. [TEC 39.024(d) and (e)] Law Enforcement Officers Standards and Education Program (Fund 429) These funds are used to account, on a project basis, for funds awarded to school districts for the continuing education of persons licensed under Chapter 1701, Occupations Code. Read to Succeed Program (Fund 429) These funds are used to account, on a project basis, for funds awarded to help generate money for public school libraries and strengthen the campus-reading program. Funds are generated through the sale of specialty license plates. Members of the community have chosen to support school libraries in the District by purchasing these specialty license plates.



Fund Descriptions

95

Texas Fitness Now Program (Fund 429) These funds are used to account, on a project basis, for funds awarded to further the goal of reducing childhood obesity and Type II diabetes. It places specific emphasis on the importance of physical education and fitness for students in grades sixth, seventh, and eighth as the foundation for a life of healthy choices. This program is authorized by Rider 89 in Article III of the General Appropriations Act (House Bill 1) passed by the 80th Legislature. Tobacco Compliance Grant (Fund 429) These funds are used to account, on a project basis, for funds awarded to on-campus law enforcement to enforce Subchapter N, Tobacco Use By Minors, Chapter 161, Texas Health and Safety Code in a manner that can be reasonably be expected to reduce the extent to which cigarettes and tobacco products are illegally sold or distributed to persons who are younger than 18 years of age. SSA Regional Day School for the Deaf (Fund 435) These funds are used by the fiscal agent of a shared services arrangement to account, on a project basis, for funds allocated for staff and activities of the Regional Day School Program for the Deaf. Campus Activity Funds (Fund 461) These funds are composed of various non-tax local monies generated at the campus-level via campus vending machines, assemblies, school-wide sales, etc. These are public funds under the responsibility and control of the campus administrator. They are used to promote the general welfare of the campus and the educational development and morale of all students within the campus. As public funds, they are subject to the same statutory controls and district regulations as the general fund. Boeing Foundation (Fund 484) These funds are used to account, on a project basis, for funds granted for the support of Improving Learning through Visual Thinking Maps and for high school Integrated Physics and Chemistry.



Fund Descriptions

96

Coalition of Essential Schools (CES) (Fund 485) These funds are used solely to support the continued growth and development of equitable, vibrant small schools as well as the mentoring efforts and participation of the Mentor School in the CES Small Schools Network funded by the Bill & Melinda Gates Foundation. Teacher Supply Reimbursement Program (Fund 486) These funds are used to reimburse classroom teachers and librarians for the purchase of classroom related supplies. Fuel Up to Play 60 (Fund 486) These funds are used to support broad-based in-school promotions and strategies that create healthy eating and physical activity opportunities for students and the school environment. Dairy Optimization (Fund 486) These funds are used to purchase dairy merchandisers which support improved access to and consumption of low-fat/fat-free dairy. Texas School Health Awards (Fund 486) These funds are used to improve the lifelong health of students, staff and/or the greater school community. Fine Arts Instructional Support Program (Fund 487) These funds are used to provide instructional support materials designed to enable students to continue participation in high quality, secondary fine arts programs. Toyota TAPESTRY (Fund 488) These funds are used to improve the academic achievement of students and designed to engage students in critical thinking and problem solving that deepen their knowledge of standards-based subject matter. In addition, funds are also used for innovative projects that enhance science education.



Fund Descriptions

97

Asia Society (Fund 489) These funds are used to build the field of Chinese language teaching in American schools. H-E-B Awards / North Central Rotary (Fund 490) The H-E-B District Excellence in Education funds are used to provide a variety of staff development and the H-E-B Fit Campus funds are used to increase the health and nutrition of students. In addition, the North Central Rotary funds are used for a summer reading program. Rackspace Foundation (Fund 490) These funds are used to provide resources and support to the Roosevelt High School cluster to create an engaged school environment enabling teachers, students and their families to reach their highest potential. PERMANENT FUND Scholarships (Fund 479) This fund is used to account for donations received where the earnings are available to fund scholarships for the District’s students and the principal received must remain intact.


COMBINING BALANCE SHEETNONMAJOR GOVERNMENTAL FUNDS

JUNE 30, 2012

Control

Data

Codes

ESEA Title IV

Safe & Drug

Free Schools Homeless

Title X, Pt.C

ESEA

Basic Program

Improving

ESEA I, A

Federal

Education

Adult

204 206 211 220

ASSETS

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

- - - - 1120 Investments

62,747 - 2,583,365 43,067 1240 Receivables From Other Governments

- - - - 1250 Accrued Interest

- 85 1,189,924 228 1260 Due From Other Funds

- - - - 1290 Other Receivables

- - - - 1300 Inventories

Total Assets1000 85 62,747 3,773,289 43,295 $ $ $ $


Liabilities:

- - 18,622 79 $ $ $ $2110 Accounts Payable

8,395 - 1,507,887 826 2160 Accrued Wages Payable

54,352 85 2,246,780 42,390 2170 Due to Other Funds

- - - - 2180 Due to Other Governments

- - - - 2300 Deferred Revenues

Total Liabilities2000 85 62,747 3,773,289 43,295

Fund Balances:

Nonspendable Fund Balance:

- - - - 3410 Inventories

- - - - 3425 Endowment Principal

Restricted Fund Balance:

- - - - 3450 Federal or State Grant Restriction

- - - - 3490 Other Restricted Fund Balance

Committed Fund Balance:

- - - - 3545 Other Committed Fund Balance

Total Fund Balances3000 - - - -

4000 Total Liabilities and Fund Balances 85 62,747 3,773,289 43,295 $ $ $ $

98

EXHIBIT H-1 (Cont'd)

TANF

Family

Formula

Part B

IDEA

Preschool

Part B

IDEA

Lunch Program

Breakfast and

National Career and

Technical -

Basic Grant

ESEA II,A

Training and

Recruiting

Title XIV

ARRA State

Stabilization

Title III, A

English Lang.

Acquisition

223 224 225 240 244 255 263 266

Assistance

- 4,041,759 - - - - - - $ $ $ $ $ $ $ $

- 5,317,727 - - - - - -

162,004 85,744 306,478 7,579 1,509,363 57,017 94,036 -

- 19,102 - - - - - -

565 26,820 - - 211,323 - 4,900 -

- 2,431 - - - - - -

- 1,444,505 - - - - - -

7,579 1,720,686 57,017 10,938,088 162,569 306,478 98,936 - $ $ $ $ $ $ $ $

2,041 341,198 22,943 - 46,261 - 7,736 - $ $ $ $ $ $ $ $

- 44,637 156,075 - 798,056 27,664 20,568 -

160,528 605,423 127,460 7,579 876,369 29,353 70,632 -

- - - - - - - -

- 892,814 - - - - - -

7,579 1,720,686 57,017 1,884,072 162,569 306,478 98,936 -

- 959,239 - - - - - -

- - - - - - - -

- 8,094,777 - - - - - -

- - - - - - - -

- - - - - - - -

- - - 9,054,016 - - - -

7,579 1,720,686 57,017 10,938,088 162,569 306,478 98,936 - $ $ $ $ $ $ $ $

99



JUNE 30, 2012

Control

Data

Codes

Medicaid

Admin. Claim

MAC Technology

ARRA - Ed.

Title II, D

Homeless

ARRA

ESEA, X, C

Formula

ARRA

IDEA, Pt. B

272 279 280 283

ASSETS

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

- - - - Investments1120

- 73,254 - - Receivables From Other Governments1240

- - - - Accrued Interest1250

- 599,009 - - Due From Other Funds1260

- - - - Other Receivables1290

- - - - Inventories1300

Total Assets1000 672,263 - - - $ $ $ $


Liabilities:

- - - - Accounts Payable $ $ $ $2110

- - - - Accrued Wages Payable2160

- 29 - - Due to Other Funds2170

- - - - Due to Other Governments2180

- - - - Deferred Revenues2300

Total Liabilities2000 29 - - -

Fund Balances:



- - - - Endowment Principal3425


- 672,234 - - Federal or State Grant Restriction3450

- - - - Other Restricted Fund Balance3490


- - - - Other Committed Fund Balance3545

Total Fund Balances3000 672,234 - - -

4000 Total Liabilities and Fund Balances 672,263 - - - $ $ $ $

100


IDEA, Pt. B

ARRA

Basic Program

Improving

ESEA I,A

Jobs

Education

Awards

Federal

Other Other

Federal

Awards

SSA

IDEA, Part B

Discretionary

SSA - IDEA, B

Preschool

Deaf

SSA

IDEA, Part B

Deaf

284 285 287 288 289 315 316 317

Preschool

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

- - - - - - - -

27,373 125,484 34,426 - - 632,681 25,693 -

- - - - - - - -

20,451 - 214 - - 2,837,177 - -

- - - - - - - -

- - - - - - - -

- - 3,469,858 125,484 47,824 34,640 25,693 - $ $ $ $ $ $ $ $

- 14,545 214 - - - - - $ $ $ $ $ $ $ $

- 1,112 326 - - 2,116,698 - -

15,349 109,827 34,100 - - 1,353,160 25,693 -

- - - - - - - -

32,475 - - - - - - -

- - 3,469,858 125,484 47,824 34,640 25,693 -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - 3,469,858 125,484 47,824 34,640 25,693 - $ $ $ $ $ $ $ $

101



JUNE 30, 2012

Control

Data

Codes

Adult Basic

Education

State SSVI

Impaired

Visually

Based Support

Community

Non-Ed.

Program

Skills

Life

381 385 392 394

ASSETS

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


13,329 6,945 293 - Receivables From Other Governments1240


- 1,001 - 16 Due From Other Funds1260



Total Assets1000 7,946 13,329 293 16 $ $ $ $


Liabilities:

- - 293 - Accounts Payable $ $ $ $2110

8,335 135 - - Accrued Wages Payable2160

4,994 7,811 - 16 Due to Other Funds2170


- - - - Deferred Revenues2300

Total Liabilities2000 7,946 13,329 293 16

Fund Balances:





- - - - Federal or State Grant Restriction3450



- - - - Other Committed Fund Balance3545

Total Fund Balances3000 - - - -

4000 Total Liabilities and Fund Balances 7,946 13,329 293 16 $ $ $ $

102


Advanced

Placement

Initiative

Success

Student

Academy

T-STEM

Textbook

State Technology

Allotment

Master

Reading

Teacher

Other

State

Awards

District

Award for

Teacher Excel

397 404 409 410 411 421 427 429

Incentives

604 - - - - - - - $ $ $ $ $ $ $ $

- - - - - - - -

- - - - 24,368 53,953 - 43,047

- - - - - - - -

- 694,615 513 142,234 7,989 - 66,471 1,584

- - - - - 1,383 - -

- - - - - - - -

142,234 32,357 55,336 694,615 604 513 66,471 44,631 $ $ $ $ $ $ $ $

- - - - 11,589 - - - $ $ $ $ $ $ $ $

604 - - - 6,822 - - -

- 595,722 - 718 13,946 53,953 66,471 43,414

- - 513 - - 1,383 - -

- 98,893 - 141,516 - - - 1,217

142,234 32,357 55,336 694,615 604 513 66,471 44,631

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

142,234 32,357 55,336 694,615 604 513 66,471 44,631 $ $ $ $ $ $ $ $

103



JUNE 30, 2012

Control

Data

Codes

SSA

Regional Day

School - Deaf

Activity

Campus

Foundation

Boeing

Schools

Essential

Coalition of

435 461 484 485

ASSETS

2,654,759 - - - Cash and Cash Equivalents $ $ $ $1110


- 1,435 - - Receivables From Other Governments1240


- 371,891 - 1,070 Due From Other Funds1260



Total Assets1000 373,326 2,654,759 - 1,070 $ $ $ $


Liabilities:

- - - - Accounts Payable $ $ $ $2110

- 156,307 - - Accrued Wages Payable2160

51,852 217,019 - - Due to Other Funds2170


- - - 1,070 Deferred Revenues2300

Total Liabilities2000 373,326 51,852 - 1,070

Fund Balances:





- - - - Federal or State Grant Restriction3450



2,602,907 - - - Other Committed Fund Balance3545

Total Fund Balances3000 - 2,602,907 - -

4000 Total Liabilities and Fund Balances 373,326 2,654,759 - 1,070 $ $ $ $

104

EXHIBIT H-1

Other

Local

Program

Instructional

Fine Arts

Tapestry

Toyota

Society

Asia HEB/

Rotary/

Rackspace

Nonmajor

Special

Revenue Funds

Nonmajor

Governmental

Funds

Permanent

Fund

Scholarships

486 487 488 489 490 Total 479 Total

Awards

- - 6,697,122 - - - 4,420 6,701,542 $ $ $ $ $ $ $ $

- - 5,317,727 - - - 227,407 5,545,134

- - 5,973,681 - - - - 5,973,681

- - 19,102 - - - - 19,102

90,103 17,156 6,294,209 8,870 - - - 6,294,209

14,894 - 18,708 - - - - 18,708

- - 1,444,505 - - - - 1,444,505

8,870 - - 17,156 104,997 25,765,054 231,827 25,996,881 $ $ $ $ $ $ $ $

170 4,775 470,466 - - - - 470,466 $ $ $ $ $ $ $ $

- - 4,854,447 - - - - 4,854,447

26,419 - 6,845,907 4,463 - - - 6,845,907

- - 1,896 - - - - 1,896

1,159 12,381 1,185,932 4,407 - - - 1,185,932

8,870 - - 17,156 27,748 13,358,648 - 13,358,648

- - 959,239 - - - - 959,239

- - - - - - 200,000 200,000

- - 8,767,011 - - - - 8,767,011

- - - - - - 31,827 31,827

77,249 - 2,680,156 - - - - 2,680,156

- - - - 77,249 12,406,406 231,827 12,638,233

8,870 - - 17,156 104,997 25,765,054 231,827 25,996,881 $ $ $ $ $ $ $ $

105


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


Control

Data

Codes

ESEA Title IV

Safe & Drug

Free Schools Homeless

Title X, Pt.C

ESEA

Basic Program

Improving

ESEA I, A

Federal

Education

Adult

204 206 211 220

REVENUES: - - - - Total Local and Intermediate Sources5700 $ $ $ $ - - - - State Program Revenues5800

151,406 - 10,428,375 276,593 Federal Program Revenues5900

Total Revenues5020 - 151,406 10,428,375 276,593

EXPENDITURES:

Current:8,340 - 7,196,083 270,464 Instruction0011

- - 13,958 - Instructional Resources and Media Services0012 - - 1,216,183 3,206 Curriculum and Instructional Staff Development0013

19,574 - 226,761 2,923 Instructional Leadership0021 - - 88,291 - School Leadership0023 - - 13,199 - Guidance, Counseling and Evaluation Services0031

102,944 - 1,320,934 - Social Work Services0032 - - 31,346 - Health Services0033

1,546 - 114,562 - Student Transportation0034 - - - - Food Services0035 - - - - Extracurricular Activities0036 - - - - General Administration0041 - - 4,982 - Facilities Maintenance and Operations0051 - - 20,957 - Security and Monitoring Services0052 - - - - Data Processing Services0053

19,002 - 181,119 - Community Services0061

Total Expenditures6030 - 151,406 10,428,375 276,593


- - - -

OTHER FINANCING SOURCES (USES): - - - - Sale of Real and Personal Property7912 - - - - Transfers In7915 - - - - Transfers Out8911

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

1200 Net Change in Fund Balance - - - -

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

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

106


TANF

Family

Assistance Formula

Part B

IDEA

PreschoolPart B

IDEA

Lunch Program

Breakfast and

National

223 224 225 240 266

Title XIV

ARRA State

Stabilization

263

Title III, A

English Lang.

Acquisition

255

ESEA II,A

Training and

Recruiting

244

Career and

Technical -

Basic Grant

2,013 - - 13,068,015 - - - - $ $ $ $ $ $ $ $ - - - 647,402 - - - -

10,625,541 60,761 244,565 17,264,892 1,347,567 550,799 1,464,505 642,143

60,761 10,627,554 244,565 30,980,309 1,347,567 550,799 1,464,505 642,143

7,225,253 60,761 242,733 - 1,347,567 127,330 401,768 585,233 - - - - - - - -

966,909 - 1,832 - - 420,466 1,062,737 34,835 510,045 - - - - - - 9,250

- - - - - - - - 1,479,194 - - - - - - -

70,624 - - - - - - - 207,289 - - - - - - -

1,130 - - - - 3,003 - - - - - 29,616,160 - - - -

41,538 - - - - - - 12,825 - - - - - - - - - - - 1,322,612 - - - - - - - 194,054 - - - -

124,910 - - - - - - -

662 - - - - - - -

60,761 10,627,554 244,565 31,132,826 1,347,567 550,799 1,464,505 642,143

- - - (152,517) - - - -

- - - 1,824 - - - - - - - - - - - -

- - - - - - - -

- - - 1,824 - - - -

- - - (150,693) - - - -

- - - 9,204,709 - - - -

$ - $ - $ - $ 9,054,016 $ - $ - $ - $ -

107




Control

Data

Codes

Medicaid

Admin. Claim

MAC Technology

ARRA - Ed.

Title II, D

Homeless

ARRA

ESEA, X, C

Formula

ARRA

IDEA, Pt. B

272 279 280 283

REVENUES: - - - - Total Local and Intermediate Sources5700 $ $ $ $ - - - - State Program Revenues5800

5,618 143,745 10,751 440,411 Federal Program Revenues5900

Total Revenues5020 143,745 5,618 10,751 440,411

EXPENDITURES:

Current:208 - 8,315 294,648 Instruction0011

- - - 74,775 Instructional Resources and Media Services00125,410 - - 59,934 Curriculum and Instructional Staff Development0013

- - - - Instructional Leadership0021 - - - - School Leadership0023 - - - 11,054 Guidance, Counseling and Evaluation Services0031 - - 17 - Social Work Services0032 - - - - Health Services0033 - - - - Student Transportation0034 - - - - Food Services0035 - - - - Extracurricular Activities0036 - 35,207 - - General Administration0041 - - - - Facilities Maintenance and Operations0051 - - - - Security and Monitoring Services0052 - - - - Data Processing Services0053 - - 2,419 - Community Services0061

Total Expenditures6030 35,207 5,618 10,751 440,411


- 108,538 - -



1200 Net Change in Fund Balance 108,538 - - -

0100 Fund Balance - July 1 (Beginning) 563,696 - - -

3000 Fund Balance - June 30 (Ending) $ 672,234 $ - $ - $ -

108


IDEA, Pt. B

ARRA

Preschool Basic Program

Improving

ESEA I,A

Jobs

Education

Awards

Federal

Other

284 285 287 288 317

SSA - IDEA, B

Preschool

Deaf

316

SSA

IDEA, Part B

Deaf

315

SSA

IDEA, Part B

Discretionary

289

Other

Federal

Awards

- - - - - 2,179 - - $ $ $ $ $ $ $ $ - - - - - - - -

173,721 54,482 10,840,614 941,190 3,165 60,423 57,545 140,821

54,482 173,721 10,840,614 941,190 3,165 62,602 57,545 140,821

16,043 14,515 10,840,614 848,949 3,084 62,229 56,114 2,954 218 39,967 - - - - - 23,867

154,338 - - 6,727 - - - 3,000 2,921 - - 83,150 81 373 1,261 -

201 - - 2,364 - - - - - - - - - - 170 -

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 111,000 - - - - - - - - - - - - - - - -

- - - - - - - -

54,482 173,721 10,840,614 941,190 3,165 62,602 57,545 140,821

- - - - - - - -

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

- - - - - - - -

- - - - - - - -

- - - - - - - -

- - - - - - - -

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

109




Control

Data

Codes

Adult Basic

Education

State SSVI

Impaired

Visually

Based Support

Community

Non-Ed.

Program

Skills

Life

381 385 392 394

REVENUES: - 1,192 - - Total Local and Intermediate Sources5700 $ $ $ $

54,569 74,870 4,293 12,422 State Program Revenues5800 - - - - Federal Program Revenues5900

Total Revenues5020 76,062 54,569 4,293 12,422

EXPENDITURES:

Current:54,569 71,762 4,293 3,398 Instruction0011

- - - - Instructional Resources and Media Services0012 - - - - Curriculum and Instructional Staff Development0013 - 4,300 - 4,489 Instructional Leadership0021 - - - - School Leadership0023 - - - - Guidance, Counseling and Evaluation Services0031 - - - - Social Work Services0032 - - - - Health Services0033 - - - 3,873 Student Transportation0034 - - - - Food Services0035 - - - - Extracurricular Activities0036 - - - - General Administration0041 - - - - Facilities Maintenance and Operations0051 - - - - Security and Monitoring Services0052 - - - - Data Processing Services0053 - - - 662 Community Services0061

Total Expenditures6030 76,062 54,569 4,293 12,422


- - - -



1200 Net Change in Fund Balance

0100 Fund Balance - July 1 (Beginning)

3000 Fund Balance - June 30 (Ending)

- - - -

-

- $

-

$ -

-

$ -

-

$ -

110


Advanced

Placement

Incentives Initiative

Success

Student

Academy

T-STEM

Textbook

State

397 404 409 410 429

Other

State

Awards

427

District

Award for

Teacher Excel

421

Master

Reading

Teacher

411

Technology

Allotment

- - - - - - - - $ $ $ $ $ $ $ $475,965 68,464 154,037 7,275,455 290,298 4,220,399 - -

- - - - 52,813 - - -

68,464 475,965 154,037 7,275,455 343,111 4,220,399 - -

259,957 46,561 143,585 7,238,765 91,660 4,009,571 - - - - - 77,094 3,437 - - -

216,008 21,903 10,452 - 115,457 206,668 - 823,995 - - - - 14,699 - - - - - - - - 3,653 - - - - - - - 507 - -

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 5,962 - - - - - - - - - - -

- - - - 111,896 - - -

68,464 475,965 154,037 7,315,859 343,111 4,220,399 - 823,995

- - - (40,404) (823,995) - - -

- - - - - - - - - - - 40,404 - - - -

- - - - - - - (40,404)

- - - 40,404 - - - (40,404)

- - - - (864,399) - - -

- - - - 864,399 - - -

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

111




Control

Data

Codes

SSA

Regional Day

School - Deaf

Activity

Campus

Foundation

Boeing

Schools

Essential

Coalition of

435 461 484 485

REVENUES:6,085,995 632,684 42 - Total Local and Intermediate Sources5700 $ $ $ $

- 719,809 - - State Program Revenues5800 - - - - Federal Program Revenues5900

Total Revenues5020 1,352,493 6,085,995 42 -

EXPENDITURES:

Current:5,656,157 1,203,481 - - Instruction0011

- - - - Instructional Resources and Media Services0012 - - 42 - Curriculum and Instructional Staff Development0013 - 74,553 - - Instructional Leadership0021 - - - - School Leadership0023 - 74,459 - - Guidance, Counseling and Evaluation Services0031 - - - - Social Work Services0032 - - - - Health Services0033 - - - - Student Transportation0034 - - - - Food Services0035 - - - - Extracurricular Activities0036 - - - - General Administration0041 - - - - Facilities Maintenance and Operations0051 - - - - Security and Monitoring Services0052 - - - - Data Processing Services0053 - - - - Community Services0061

Total Expenditures6030 1,352,493 5,656,157 42 -

1100 Excess (Deficiency) of Revenues Over (Under) - 429,838 - - ExpendituresOTHER FINANCING SOURCES (USES):

- - - - Sale of Real and Personal Property7912 - - - - Transfers In7915

(250,652) - - - Transfers Out8911

Total Other Financing Sources (Uses) 7080 - (250,652) - -

1200 Net Change in Fund Balance

0100 Fund Balance - July 1 (Beginning)

3000 Fund Balance - June 30 (Ending)

- 179,186 - -

-

$ -

2,423,721

$ 2,602,907

-

$ -

-

$ -

112

EXHIBIT H-2

Other

Local

Awards Program

Instructional

Fine Arts

Tapestry

Toyota

Society

Asia

486 487 488 489 Total

Nonmajor

Governmental

Funds

479

Permanent

Fund

Scholarships

Total

Nonmajor

Special

Revenue Funds

490

HEB/

Rotary/

Rackspace

4,000 15,416 45 20,509 20,088,514 231,827 19,856,687 24,597 $ $ $ $ $ $ $ $ - - - - 13,997,983 - 13,997,983 - - - - - 55,982,446 - 55,982,446 -

15,416 4,000 45 20,509 90,068,943 231,827 89,837,116 24,597

4,000 125,177 45 10,271 48,558,749 - 48,558,749 22,292 - - - - 233,394 - 233,394 78 - - - 10,238 5,360,209 - 5,360,209 19,869 - - - - 954,380 - 954,380 - - 143 - - 95,462 - 95,462 810 - - - - 1,578,583 - 1,578,583 -

- - - - 1,494,519 - 1,494,519 - - - - - 238,635 - 238,635 - - - - - 124,114 - 124,114 - - 4,245 - - 29,620,405 - 29,620,405 - - - - - 54,363 - 54,363 - - - - - 35,207 - 35,207 - - - - - 1,438,594 - 1,438,594 - - - - - 220,973 - 220,973 - - - - - 124,910 - 124,910 -

- 1,075 - - 321,134 - 321,134 4,299

130,640 4,000 45 20,509 90,453,631 - 90,453,631 47,348

(115,224) - - - (22,751) (616,515) 231,827 (384,688)

- - - - 1,824 - 1,824 - - 115,224 - - 155,628 - 155,628 -

- - - - (291,056) - (291,056) -

115,224 - - - (133,604) - (133,604) -

- - - - (22,751) (750,119) 231,827 (518,292)

-

- $

-

$ -

-

$ -

-

$ -

100,000

$ 77,249

13,156,525

$ 12,406,406

-

$ 231,827

13,156,525

$ 12,638,233

113

114




Fund Descriptions

115

The Internal Service Funds are used to account for the financing of goods and services provided by certain departments in the District to other departments in the District on a cost-reimbursement basis. Document Management & Printing Services Fund accounts for the operations of the District’s Document Management Department. Revenue is comprised of user charges from the various campuses and departments within the District. (Fund 752) Health Insurance Fund accounts for the operations of the District’s self-funded medical programs, including the state-mandated medical plan comparable to the TRS health plan. Contributions are collected from the employees of the District along with amounts contributed from various District accounts. Claim costs, administrative costs, stop-loss premiums, hospital indemnity claims, employee assistance program fees, and employee term-life insurance are paid from the proceeds of the premiums collected. Excess claims are covered by a stop-loss carrier. (Fund 753) Data Processing Center Fund accounts for the operations of the District’s Data Processing Department. Revenue is comprised of user charges from the various departments within the District. (Fund 754) Network Technology Services Fund accounts for the operations of the District’s network infrastructure and the maintenance and repair of computers across the District. Revenue is comprised of user charges from the various departments within the District. (Fund 755) Dental Insurance Fund accounts for the operations of the District’s self-funded dental insurance plan. Participation is voluntary and contributions are collected from employees of the District. Claim costs, administrative costs, and vision discount program fees are paid from the proceeds of the contributions collected. Excess claims are the responsibility of the employees. (Fund 773) Workers’ Compensation Insurance Fund accounts for the operations of the District’s self-funded, self-administered program that meets the state mandate that all District employees be covered by workers’ compensation insurance. Premiums are collected from each department of the District. Claim costs, administrative costs, and stop-loss insurance premiums are paid from the premiums collected. Excess claims are covered by an outside insurance company. (Fund 793)



Fund Descriptions

116

Rolling Owner Controlled Insurance Program Fund accounts for the operations of the District’s ROCIP that covers several construction projects over a period of years. The ROCIP allows the District to purchase a large package of insurance at lower premiums. This insurance covers the owner, contractors, and subcontractors working on the construction projects. Insurance coverage provided under the ROCIP includes on-site workers’ compensation, general liability, excess liability, and builder’s risk. The cost of on-site insurance coverage for the contractors is paid for through the deduction of the insurance cost contractors would have passed on to the District for the various construction projects under the 1998 and 2003 Bond construction programs. (Fund 794) Unemployment Compensation Insurance Fund accounts for the operations of the District’s self-funded, self-administered program that meets the state mandate that all District employees be covered by unemployment compensation insurance. Premiums are collected from each department of the District. Claim costs, administrative costs, and stop-loss insurance premiums are paid from the premiums collected. Excess claims are covered by an outside insurance company. (Fund 795) Police Services Fund accounts for the operations of the District’s police force. Revenue is comprised of user charges from the various campuses and departments within the District. (Fund 796)

117



COMBINING STATEMENT OF NET ASSETSINTERNAL SERVICE FUNDS

JUNE 30, 2012

Document

Management &

Printing Svc

Insurance

Health

752 753

ASSETS

Current Assets:3,567,857 606,734 Cash and Cash Equivalents $ $5,791,313 - Investments - Current

338 - Due from Other Governments31,817 - Accrued Interest

3,625,128 1,528 Due from Other Funds2,589 2,185 Other Receivables

- 633,569 Inventories

1,244,016 13,019,042 Total Current Assets


- - Buildings and Improvements - - Depreciation on Buildings - 2,666,063 Furniture and Equipment - (2,457,330)Depreciation on Furniture and Equipment

208,733 - Total Noncurrent Assets

Total Assets 1,452,749 13,019,042

LIABILITIES

Current Liabilities:778,029 63,186 Accounts Payable

- - Short Term Workers Compensation Payable761 22,386 Accrued Wages Payable

6,956 64,228 Due to Other Funds - 366 Due to Other Governments

3,848,000 - Accrued Expenses3,625,128 - Unearned Revenues

150,166 8,258,874 Total Current Liabilities

Noncurrent Liabilities: - - Accrued Expenses - Due in More than One Year

- - Total Noncurrent Liabilities

Total Liabilities 150,166 8,258,874

NET ASSETS

- 208,733 Invested in Capital Assets4,760,168 1,093,850 Unrestricted Net Assets

Total Net Assets 1,302,583 4,760,168 $ $

118

EXHIBIT H-3

Data

Processing

Services

Technology

Network

Insurance

Dental

Insurance

Compensation

Workers' Rolling Owner

Controlled

Ins Program

Unemployment

Compensation

Insurance

Total

Internal

Service Funds

Police

Services

Center

754 755 773 793 794 795 796

- 602,861 57,462 2,228,895 1,278,173 690,035 252,322 9,284,339 $ $ $ $ $ $ $ $ - 2,093,298 - - - 925,287 - 8,809,898 - - - - - - - 338 - 22,805 - - - 12,656 - 67,278 - - - 43,412 892 - 193,813 3,864,773

975,380 - - - 95,099 - 12,393 1,087,646 - - - 382,421 337,829 - - 1,353,819

2,654,728 1,711,993 1,627,978 2,718,964 975,380 57,462 458,528 24,468,091

- - - - 483,379 - - 483,379 - - - - (246,602) - - (246,602) - 30,528 - 7,450,751 2,926,753 - 698,893 13,772,988 - (30,528) - (1,888,752) (2,024,670) - (552,795) (6,954,075)

5,561,999 1,138,860 - - - - 146,098 7,055,690

8,216,727 2,850,853 1,627,978 2,718,964 975,380 57,462 604,626 31,523,781

- 25,736 - 149,035 25,614 - 283 1,041,883 - 449,019 - - - - - 449,019 - - - 4,400 17,111 - 20,809 65,467

357,614 42,728 - 171,485 50,387 169 90,731 784,298 - - - - - - - 366 - - - - - 312,000 - 4,160,000 - - - - - - - 3,625,128

324,920 93,112 312,169 517,483 357,614 - 111,823 10,126,161

- 1,234,149 - - - - - 1,234,149

- - - 1,234,149 - - - 1,234,149

324,920 93,112 312,169 1,751,632 357,614 - 111,823 11,360,310

- - - 5,561,999 1,138,860 - 146,098 7,055,690 617,766 967,332 57,462 2,329,808 1,618,881 1,315,809 346,705 13,107,781

7,891,807 2,757,741 1,315,809 967,332 617,766 57,462 492,803 20,163,471 $ $ $ $ $ $ $ $

119


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


Document

Management &

Printing Svc

Insurance

Health

752 753

OPERATING REVENUES:

50,549,708 3,000,636 Local and Intermediate Sources $ $5,199 92,489 State Program Revenues

984 - Federal Revenues

Total Operating Revenues 3,093,125 50,555,891

OPERATING EXPENSES:

167,648 1,424,383 Payroll Costs2,490,995 318,210 Professional and Contracted Services

6,231 1,172,249 Supplies and Materials51,155,264 18,412 Other Operating Costs

- 95,392 Depreciation Expense

Total Operating Expenses 3,028,646 53,820,138

Operating Income (Loss) 64,479 (3,264,247)


35,396 - Earnings From Temporary Deposits & Investments - - Loss on Sale of Real and Personal Property - - Nonoperating Expenses

Total Nonoperating Revenues (Expenses) - 35,396

Income (Loss) Before Transfers 64,479 (3,228,851)

- 100,000 Transfers In - (126,640)Transfers Out




37,839

1,264,744

$ 1,302,583

(3,228,851)

7,989,019

$ 4,760,168

120

EXHIBIT H-4

Processing

Center Services

Technology

Network

Insurance

Dental

Insurance

Compensation

Workers' Rolling Owner

Controlled

Ins Program

Unemployment

Compensation

Insurance

Police Total

Services Internal

Service Funds

Data

754 755 773 793 794 795 796

3,349,895 4,481,318 2,882,481 1,571,472 334,559 $ $ $ $ $ 304,990 $ 3,768,023 70,243,082 $ $160,046 160,425 - 31,194 - - 232,569 681,922

1,015,692 169,032 84 - - - - 1,185,792

4,810,775 4,525,633 2,882,565 1,602,666 334,559 304,990 4,000,592 72,110,796

2,444,972 1,821,571 2,844 455,307 - - 3,610,947 9,927,672 330,549 1,529,119 171,406 139,948 13 - 109,213 5,089,453

1,196,263 359,096 - 8,339 - - 126,469 2,868,647 29,630 10,799 3,012,764 353,838 281,354 275,621 3,157 55,140,839

486,938 501,030 - - - - 77,827 1,161,187

4,221,615 4,488,352 3,187,014 957,432 281,367 275,621 3,927,613 74,187,798

589,160 37,281 (304,449) 645,234 53,192 29,369 72,979 (2,077,002)

- - 7,257 13,323 - - - 55,976 (5,785) - - - - - - (5,785)

- (1,531) - - - - - (1,531)

(1,531) (5,785) 7,257 13,323 - - - 48,660

587,629 31,496 (297,192) 658,557 53,192 29,369 72,979 (2,028,342)

2,731,689 748,444 - - - - - 3,580,133 (5,444)(2,605,049) - - - - - (2,737,133)

(1,268,976)

9,160,783

$ 7,891,807

2,757,741

-

$ 2,757,741

(297,192)

1,613,001

$ 1,315,809

658,557

308,775

$ 967,332

53,192

564,574

$ 617,766

29,369

28,093

$ 57,462

72,979

419,824

$ 492,803

(1,185,342)

21,348,813

$ 20,163,471

121


COMBINING STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED JUNE 30, 2012INTERNAL SERVICE FUNDS

Document Health Data Network

Management & Insurance Processing Technology

Printing Svc Center Services

752 753 754 755


50,741,680 2,998,925 5,085,267 4,270,488 Cash Received From User Charges $ $ $ $

- 443,038 2,961,822 49,494 Cash Received From Assessments - Other Funds(162,194)(1,329,810) (1,673,155) (2,267,815)Cash Payments to Employees for Services

(50,809,227) - - - Cash Payments for Insurance Claims(3,718,761)(1,456,848) (1,534,288) (1,824,476)Cash Payments for Suppliers

(183,375) - - - Cash Payments to Other Funds - Operating

655,305 Net Cash Provided by (Used for) Operating

(4,131,877) 4,839,646 227,691 Activities


- 100,000 743,000 1,346,924 Increase (Decrease) in Short-term Loans - (126,640) (1,220,284) - Transfers Out

(26,640)Net Cash Provided by (Used for) Non-Capital

- (477,284) 1,346,924 Financing Activities


- (21,931) (2,047,216) (322,712)Acquisition of Capital Assets - - (86,251) - Payments on Capital Leases - - - 26,270 Gain on Sale of Capital Assets

(21,931)Net Cash Used For Capital and

- (2,133,467) (296,442)Related Financing Activities

Cash Flows from Investing Activities:

(2,790,645) - - - Purchase of Investment Securities35,396 - - - Interest and Dividends on Investments

- Net Cash Used For Investing

(2,755,249) - - Activities

Net Increase (Decrease) in Cash and Cash Equivalents 606,734 (6,887,126) 2,228,895 1,278,173

Cash and Cash Equivalents at Beginning of Year - 10,454,983 - -

Cash and Cash Equivalents at End of Year 606,734 3,567,857 2,228,895 1,278,173 $ $ $ $

122


Dental Workers' Rolling Owner Unemployment

Insurance Compensation Controlled Compensation

Insurance Ins Program Insurance

773 793 794 795 796

Police

Services

Total

Internal

Service Funds

71,620,714 2,882,565 1,571,472 - 304,990 3,765,327 $ $ $ $ $ $

3,643,633 192 19,523 - 68,014 101,550

(9,235,392)(2,844) (424,111) - - (3,375,463)

(54,715,676)(3,012,764) (296,789) (281,354) (315,542) - (9,735,028)(101,336) (860,213) (14) - (239,092)

(5,007,768) - - (4,824,393) - -

(234,187) (3,429,517)9,882 (5,105,761) 57,462 252,322

2,189,924 - - - - -

(1,346,924) - - - - -

- 843,000 - - - -

(2,391,859) - - - - -

(86,251) - - - - -

26,270 - - - - -

- (2,451,840) - - - -

(4,832,595)(925,287) (1,116,663) - - -

43,319 (5,400) 13,323 - - -

(930,687) (4,789,276)(1,103,340) - - -

(1,164,874) (9,827,633)

1,854,909 19,111,972

690,035 9,284,339 $ $$

(1,093,458)

1,696,319

602,861

(5,105,761)

5,105,761

- $ $

57,462

-

57,462 $

252,322

-

252,322

123



FOR THE YEAR ENDED JUNE 30, 2012INTERNAL SERVICE FUNDS

Document Health Data Network

Management & Insurance Processing Technology

Printing Svc Center Services

752 753 754 755

Operating Income (Loss): $ $ $ $


Provided by (Used for) Operating Activities:

64,479 (3,264,247) 589,160 37,281

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

- 95,392 501,030 486,938 Depreciation


71 (1,711) 434,917 (95,099)Decrease (Increase) in Receivables - 14,786 454,789 (293,651)Decrease (Increase) in Inventories

(184,128)428,757 2,899,983 (893)Decrease (Increase) in Due From Other Funds(222,508)37,238 (90,061) 25,614 Increase (Decrease) in Accounts Payable190,916 - - - Increase (Decrease) in Unearned Revenues

- 234 - - Increase (Decrease) in Due to Other Governments753 14,046 61,839 50,390 Increase (Decrease) in Due to Other Funds254 2,084 (12,011) 17,111 Increase (Decrease) in Accrued Wages Payable

(652,988) - - - Increase (Decrease) in Accrued Expenses - - - - Increase (Decrease) in Workers' Comp Payable

Net Cash Provided by (Used for)(4,131,877) 4,839,646 227,691 Operating Activities 655,305 $ $ $ $

Noncash Investing, Capital and Financing Activities:

- - (1,335,142) 1,335,142 Contributions of Capital Assets From Other Funds652,988 - - - Change in Actuarial Estimates

(2,456) - - - Increase in Fair Value of Investments

124

Exhibit H-5

Dental Workers' Rolling Owner Unemployment

Insurance Compensation Controlled Compensation

Insurance Ins Program Insurance

773 793 794 795 796

Police

Services

Total

Internal

Service Funds

$ $(304,449) (2,077,002)$ 645,234 53,192 $ $ 29,369 $ 72,979

1,161,187 - - - - 77,827

924 - - (334,558) - (2,696)

175,924 - - - - -

3,314,856 842 - 411 68,014 101,870

(293,826) - (3,934) - (39,921) (254)190,916 - - - - -

234 - - - - -

(4,679,225)(650) 19,523 (4,824,806) - (320)

10,354 - - - - 2,916

(682,878)70,070 (99,960) - - -

(550,981) - (550,981) - - -

(3,429,517)(234,187) 9,882 (5,105,761) 57,462 252,322 $$$$$$

1,335,142 - - - - -

1,233,859 (70,070) 650,941 - - - 16,552 12,632 6,376 - - -

125

126



Enterprise Funds

Fund Descriptions

127

The Enterprise Funds are used to account for the financing or recovery of costs of providing goods and services to the general public on a continuing basis primarily through user charges. Property Management Fund accounts for the revenues and expenditures associated with the rental of District facilities and the sale of disposed items. (Fund 711) Uniform Rental Fund accounts for the rental of uniforms. Revenue is comprised of user charges from band, orchestra, spirit, and choir groups. (Fund 713) Community Education Fund accounts for services provided to the community for after school childcare and community education classes. Revenue is comprised of user charges from the community and after school tuition fees. (Fund 714) Preschool Program for Children with Disabilities (PPCD) Fund accounts for the operations of the PPCD program which provides daycare services for children with disabilities. (Fund 715) North East Aquatics and Tennis (NEAT) Fund accounts for the North East Aquatics and Tennis Center’s operations. Revenue is comprised of user charges from team activities. (Fund 721)


COMBINING STATEMENT OF NET ASSETSNONMAJOR ENTERPRISE FUNDS

JUNE 30, 2012

Property

Management Rental

Uniform

711 713

ASSETS

Current Assets:342,541 487,408 Cash and Cash Equivalents $ $

- - Due from Other Governments6,626 1,123,311 Due from Other Funds

- 64,978 Other Receivables

1,675,697 349,167 Total Current Assets


- 1,585,748 Land - 4,400,529 Buildings and Improvements - (1,522,246)Depreciation on Buildings - 100,642 Furniture and Equipment - (85,469)Depreciation on Furniture and Equipment

4,479,204 - Total Noncurrent Assets

Total Assets 6,154,901 349,167

LIABILITIES

Current Liabilities: - 195 Accounts Payable - 1,832 Accrued Wages Payable - 15,981 Due to Other Funds - 90 Due to Other Governments - - Unearned Revenues

Total Liabilities 18,098 -

NET ASSETS - 4,479,204 Invested in Capital Assets

349,167 1,657,599 Unrestricted Net Assets

Total Net Assets 6,136,803 349,167 $ $

128

EXHIBIT H-6

Community

Education

Disabilities

Children w/

Preschool Pro

Tennis

Aquatics &

North East

Funds

Enterprise

Nonmajor

714 715 721 Total

4,669,035 2,361,130 202,781 1,275,175 $ $ $ $12,660 12,660 - -

1,137,800 7,863 - - 158,255 15,885 258 77,134

2,397,538 203,039 1,352,309 5,977,750

2,547,600 961,852 - - 9,883,138 5,482,609 - -

(2,600,036)(1,077,790) - - 205,999 20,891 - 84,466

(120,252)(3,812) - (30,971)

5,383,750 - 53,495 9,916,449

7,781,288 203,039 1,405,804 15,894,199

20,127 18,981 - 951 92,161 33,120 56,600 609

844,197 794,417 4,880 28,919 95 - - 5

71,669 41,678 21,881 8,110

888,196 83,361 38,594 1,028,249

9,916,449 5,383,750 - 53,495 4,949,501 1,509,342 119,678 1,313,715

6,893,092 119,678 1,367,210 14,865,950 $ $ $ $

129


COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETSNONMAJOR ENTERPRISE FUNDS


Property

Management Rental

Uniform

711 713

OPERATING REVENUES:

62,982 530,360 Local and Intermediate Sources $ $ - 36,996 State Program Revenues

Total Operating Revenues 567,356 62,982

OPERATING EXPENSES:

- 456,997 Payroll Costs - 60,879 Professional and Contracted Services

24,198 34,664 Supplies and Materials - 4,622 Other Operating Costs - 206,537 Depreciation Expense

Total Operating Expenses 763,699 24,198

Operating Income (Loss) (196,343) 38,784


- 50,859 Gain on Sale of Real and Personal Property - - Nonoperating Expenses

Total Nonoperating Revenues (Expenses) 50,859 -

Income (Loss) Before Transfers (145,484) 38,784

- (47,652)Transfers Out




(193,136)

6,329,939

$ 6,136,803

38,784

310,383

$ 349,167

130

EXHIBIT H-7

Education

Disabilities

Children w/

Preschool Pro

Tennis

Aquatics &

North East

Funds

Enterprise

NonmajorCommunity

714 715 721 Total

442,060 7,491,542 697,540 9,224,484 $ $ $ $24,242 171,716 - 232,954

7,663,258 466,302 697,540 9,457,438

415,059 5,051,978 265,527 6,189,561 164 473,768 119,946 654,757

4,150 309,178 22,706 394,896 5,941 410,427 149,262 570,252

- 185,564 16,893 408,994

6,430,915 425,314 574,334 8,218,460

1,232,343 40,988 123,206 1,238,978

- - - 50,859 - (34,813) - (34,813)

(34,813) - - 16,046

1,197,530 40,988 123,206 1,255,024

- - - (47,652)

1,197,530

5,695,562

$ 6,893,092

40,988

78,690

$ 119,678

123,206

1,244,004

$ 1,367,210

1,207,372

13,658,578

$ 14,865,950

131



FOR THE YEAR ENDED JUNE 30, 2012NONMAJOR ENTERPRISE FUNDS

Property Uniform

Management Rental

711 713


62,982 573,856 Cash Received From User Charges $ $

304,249 442,473 Cash Received From Assessments - Other Funds - (422,511)Cash Payments to Employees for Services

(24,690)(100,482)Cash Payments for Suppliers

493,336 Net Cash Provided by Operating

342,541 Activities


- (47,652)Transfers Out - 50,859 Gain on Sale of Non Capital Assets

3,207 Net Cash Provided by Non-Capital

- Financing Activities


- (9,235)Acquisition of Capital Assets - - Interest Expense on Internal Loan

(9,235)Net Cash Used for Capital and

- Related Financing Activities

Net Increase in Cash and Cash Equivalents 487,308 342,541

Cash and Cash Equivalents at Beginning of Year 100 -

Cash and Cash Equivalents at End of Year 487,408 342,541 $ $

132


Community Preschool Pro North East Nonmajor

Education Children w/ Aquatics & Enterprise

Disabilities Tennis Funds

714 715 721 Total

7,493,915 441,963 686,282 9,258,998 $ $ $ $

1,021,785 146,109 1,205,333 3,119,949

(4,883,591) (375,035) (268,778) (5,949,915)

(1,228,156) (10,256) (347,712) (1,711,296)

2,403,953 202,781 1,275,125 4,717,736

- - - (47,652) - - - 50,859

- - - 3,207

(8,210) - - (17,445)

(34,813) - - (34,813)

(43,023) - - (52,258)

2,360,930

200

2,361,130 $ $

202,781

-

202,781

1,275,125

50

1,275,175 $ $

4,668,685

350

4,669,035

133



FOR THE YEAR ENDED JUNE 30, 2012NONMAJOR ENTERPRISE FUNDS

Property Uniform

Management Rental

711 713

Operating Income (Loss): $ $


Provided By Operating Activities:

(196,343) 38,784

to Net Cash Provided by Operating Activities:Adjustments to Reconcile Operating Income

- 206,537 Depreciation


- 43,378 Decrease (Increase) in Receivables - 19,237 Decrease (Increase) in Due From Other Governments

304,249 424,570 Decrease (Increase) in Due From Other Funds(492)(317)Increase (Decrease) in Accounts Payable

- - Increase (Decrease) in Unearned Revenues - 93 Increase (Decrease) in Due to Other Governments - (1,309)Increase (Decrease) in Due to Other Funds - (2,510)Increase (Decrease) in Accrued Wages Payable

Net Cash Provided by OperatingActivities $ 493,336 $ 342,541

134

Exhibit H-8

Community Preschool Pro North East Nonmajor

Education Children w/ Aquatics & Enterprise

Disabilities Tennis Funds

714 715 721 Total

$ 1,232,343 $ 40,988 123,206 $ $ 1,238,978

185,564 - 16,893 408,994

2,374 (98) (11,257) 34,397

(12,660) - - 6,577

1,553,482 136,724 1,201,464 3,620,489

(34,781) - (55,798) (91,388)(315,624) 7,481 - (308,143)

- - (131) (38)

(203,413) 1,904 4,000 (198,818)

(3,332) 15,782 (3,252) 6,688

2,403,953 202,781 1,275,125 4,717,736 $$$$

135


Agency Funds

136

Agency Funds are used to account for assets held by the District as an agent for certain individuals and organizations. They are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations: Student Activity Fund is used to account for the receipt and disbursement of funds for the various student groups and organizations at each school campus. (Fund 865) Central Office Fund is used to account for the receipt and disbursement of funds for the special projects and programs of the Central Office staff. (Fund 893)

EXHIBIT H-9


COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

ALL AGENCY FUNDS


BALANCE

JULY 1

2011 ADDITIONS

DEDUCTIONS

2012

JUNE 30

BALANCE

STUDENT ACTIVITY ACCOUNTAssets:

2,402,044 2,520,889 2,965,552 Cash and Temporary Investments 1,957,381 $ $ $ $5,997 - - Due From Other Funds 5,997

Total Assets 2,520,889 2,408,041 2,965,552 1,963,378 $ $ $ $

Liabilities:5,645 7,794 7,794 Due to Other Funds 5,645 $ $ $ $

229,142 2,513,095 784,504 Due to Student/Employee Groups 1,957,733

Total Liabilities 2,520,889 234,787 792,298 1,963,378 $ $ $ $

CENTRAL OFFICEAssets:

603,453 302,410 524,640 Cash and Temporary Investments 381,223 $ $ $ $111,977 11,229 115,859 Due From Other Funds 7,347

336 56 282 Other Receivables 110

Total Assets 313,695 715,766 640,781 388,680 $ $ $ $

Liabilities:191,680 22,724 190,701 Accounts Payable 23,703 $ $ $ $287,641 1,505 190,687 Due to Other Funds 98,459 171,595 7,244 173,034 Due to Other Governments 5,805 347,768 282,222 369,277 Due to Student/Employee Groups 260,713

Total Liabilities 313,695 998,684 923,699 388,680 $ $ $ $

TOTAL AGENCY FUNDSAssets:

3,005,497 2,823,299 3,490,192 Cash and Temporary Investments 2,338,604 $ $ $ $117,974 11,229 115,859 Due From Other Funds 13,344

336 56 282 Other Receivables 110

Total Assets 2,834,584 3,123,807 3,606,333 2,352,058 $ $ $ $

Liabilities:191,680 22,724 190,701 Accounts Payable 23,703 $ $ $ $293,286 9,299 198,481 Due to Other Funds 104,104 171,595 7,244 173,034 Due to Other Governments 5,805 576,910 2,795,317 1,153,781 Due to Student Groups 2,218,446

Total Liabilities 2,834,584 1,233,471 1,715,997 2,352,058 $ $ $ $

137

138


139

Capital Assets Used in the Operation of Governmental Funds


Capital Assets Used In The Operation Of Governmental Funds Comparative Schedule By Source

June 30, 2012

140

June 30, June 30, 2012 2011

Governmental Funds Capital Assets:Land $ 84,095,820 $ 84,028,681 Buildings and Improvements 1,476,743,915 1,451,671,609 Furniture and Equipment 39,825,016 38,625,205 Construction in Progress 81,488,185 46,052,338

Totals $ 1,682,152,936 $ 1,620,377,833

Investments in Capital Assets by Source:General Fund $ 198,520,530 $ 198,430,480 Special Revenue Funds 4,120,166 2,822,223 Capital Projects Fund 1,479,512,240 1,419,125,130

Totals $ 1,682,152,936 $ 1,620,377,833

NOTE: This schedule presents only the capital asset balances related to governmental funds. Accordingly, the capital assets reported in internal service funds are excluded from the above amounts. Generally, the capital assets of internal service funds are included in the governmental activities column in the Statement of Net Assets. .


Capital Assets Used In The Operation Of Governmental Funds Schedule By Function And Activity

June 30, 2012

141

Buildings Furnitureand and Construction

Land Improvements Equipment in Progress Total

Instruction $ - $ - $ 3,380,783 $ - $ 3,380,783Instructional Resources and

Media Services - - 264,937 - 264,937Curriculum and

Staff Development - - 114,552 - 114,552Instructional Leadership - - 107,503 - 107,503School Leadership - - 31,327 - 31,327Guidance, Counseling

and Evaluation Services - - 151,725 - 151,725Social Work Services - - 115,234 - 115,234Student (Pupil) Transportation - - 24,605,574 - 24,605,574Food Services - - 2,019,061 - 2,019,061Cocurricular/extracurricular

Activities - - 316,080 - 316,080General Administration - - 118,366 - 118,366Plant Maintenance

and Operations - - 5,172,143 - 5,172,143Security and Monitoring

Services - - 7,060 - 7,060Data Processing Services - - 43,118 - 43,118Facility Acquisition

and Construction 84,095,820 1,476,743,915 3,377,553 81,488,185 1,645,705,473 Totals $ 84,095,820 $ 1,476,743,915 $ 39,825,016 $ 81,488,185 $ 1,682,152,936

NOTE: This schedule presents only the capital asset balances related to governmental funds. Accordingly, the capital assets reported in internal service funds are excluded from the above amounts. Generally, the capital assets of internal service funds are included in the governmental activities column in the Statement of Net Assets


Capital Assets Used In The Operation Of Governmental Funds Schedule Of Changes By Function

For The Year Ended June 30, 2012

142

. Beginning Ending

Balance Additions Deletions Balance

Instruction $ 2,796,228 $ 602,838 $ (18,283) $ 3,380,783Instructional Resources and Media Services 264,937 - 264,937Curriculum and Staff Development 114,552 - - 114,552Instructional Leadership 107,503 - - 107,503School Leadership 31,327 - - 31,327Guidance, Counseling and Evaluation Services 136,035 15,690 - 151,725Social Work Services 115,234 - - 115,234Student (Pupil) Transportation 24,605,573 - - 24,605,573Food Services 1,236,960 782,101 - 2,019,061Cocurricular/extracurricular Activities 316,080 - - 316,080General Administration 109,616 8,750 - 118,366Plant Maintenance and Operations 5,130,838 102,418 (61,113) 5,172,143Security and Monitoring Services 7,060 - - 7,060 Data Processing Services 43,118 - - 43,118Facility Acquisition and Construction 1,585,362,772 60,342,702 - 1,645,705,474

$ 1,620,377,833 $ 61,854,499 $ (79,396) $ 1,682,152,936

NOTE: This schedule presents only the capital asset balances related to governmental funds. Accordingly, the capital assets reported in internal service funds are excluded from the above amounts. Generally, the capital assets of internal service funds are included in the governmental activities column in the Statement of Net Assets.

143

Schedules Required By the

Texas Education Agency


SCHEDULE OF DELINQUENT TAXES RECEIVABLE

FISCAL YEAR ENDED JUNE 30, 2012

Last 10 Years

Tax Rates

Debt ServiceMaintenance Tax Purposes

Value for School

Assessed/Appraised

(1) (2) (3)

VariousVariousand prior years2003 $ Various

0.2440001.500000 17,547,082,428 2004

0.2940001.500000 18,593,101,103 2005

0.2940001.500000 20,142,990,291 2006

0.3090001.360000 22,685,082,844 2007

0.3629001.040000 25,984,400,571 2008

0.3629001.040000 28,465,680,768 2009

0.3629001.040000 28,502,500,506 2010

0.3629001.040000 28,129,843,160 2011

0.3629001.040000 28,019,059,238 (School year under audit)2012

1000 TOTALS

Source: Bexar County Tax Assessor/Collector's Office

Current year adjustments must be applied to the tax levy after October 1 due to taxpayer


Current year adjustments must be applied to the tax levy after October 1 due to taxpayer protests and valuation adjustments.





For fiscal years 2004 and earlier, the District's fiscal year ended August 31st. The fiscal year end changed to June 30th during fiscal year 2005. Fiscal 2005 represents a 10 month period.



For fiscal years 2004 and earlier, the District's fiscal year ended August 31st. The fiscal year end changed to June 30th during fiscal year 2005. Fiscal 2005 represents a 10 month period.

144

EXHIBIT J-1

7/1/2011

Balance

Beginning

Total Levy

Year's

Current

(20)(10) (50)

Ending

Balance

6/30/2012

(40)

Entire

Year's

Adjustments

(31)

Maintenance

Collections

(32)

Debt Service

Collections

- 1,864,141 27,212 (335,297)$ $ $ $ $ 1,497,525 $ 4,107

- 484,411 6,429 25,862 502,798 1,046

- 511,669 19,852 2,159 490,085 3,891

- 523,540 26,843 (5,749) 485,687 5,261

- 656,934 110,078 25,313 547,159 25,010

- 993,088 179,646 1,453 752,209 62,686

- 1,032,995 166,865 (62,400) 745,504 58,226

- 3,086,346 158,504 (584,643) 2,287,890 55,309

- 15,769,777 8,514,663 (1,030,792) 3,253,195 2,971,127

380,983,917 - 268,990,989 - 18,130,568 93,862,360

$ 28,692,620 $ (1,964,094)$ 278,201,081 $ 380,983,917 $ 24,922,901 $ 97,049,023

145

EXHIBIT J-2NORTH EAST INDEPENDENT SCHOOL DISTRICT

SCHEDULE OF EXPENDITURES FOR COMPUTATIONS OF INDIRECT COST FOR 2013-2014GENERAL AND SPECIAL REVENUE FUNDS


FUNCTION 41 AND RELATED FUNCTION 53 - GENERAL ADMINISTRATION, 99 - APPRAISAL DISTRICT COST

Account

Number Board

School

(702)

Collections

Tax

(703)

Office

Supt's

(701)

21 3 4

(750)

Indirect

Cost

5

(720)

Direct

Cost

6

(other)

Miscellaneous

7

Total

Account

Name

-- 467,744 6,657,074 338,016 - 7,462,834$ $ $ $ $ $ $PAYROLL COSTS611X-6146

-- - 29,096 - - 29,096Leave for Separating

Employees in Fn 41 & 53

6149

-- - 621,083 - - 621,083Leave - Separating Employees

not in 41 & 53

6149

-576,780 - - - - 576,780Legal Services6211

-- - 81,200 - - 81,200Audit Services6212

2,142,340- - - - - 2,142,340Tax Appraisal/Collection -

Appraisal in Fn 99

6213

-- - - - - -Lobbying6214

-150 - 112,229 - - 112,379Other Professional Services621X

-- - - - - -Tuition and Transfer Payments6220

-- - 1,550 - - 1,550Education Service Centers6230

-- - - 25,014 - 25,014Contr. Maint. and Repair6240

-- - - - - -Utilities6250

-- - 343 - - 343Rentals6260

-1,757 1,313 1,816,785 1,648 - 1,821,503Miscellaneous Contr.6290

-274 487 55,767 41 - 56,569Textbooks and Reading6320

-- - - - - -Testing Materials6330

-11,627 5,400 177,085 4,612 - 198,724Other Supplies Materials63XX

-5,690 5,004 50,401 8,024 - 69,119Travel, Subsistence, Stipends6410

-- - 329,207 - - 329,207Ins. and Bonding Costs6420

-243,450 - - - - 243,450Election Costs6430

-9,828 23,006 135,751 2,163 - 170,748Miscellaneous Operating6490

-- - - - - -Debt Service6500

-- - - - 8,750 8,750Capital Outlay6600

$TOTAL6000 849,556 2,142,340 502,954 10,067,571 379,518 8,750 13,950,689$ $ $ $ $ $

Total expenditures/expenses for General and Special Revenue Funds: 545,618,509

LESS: Deductions of Unallowable Costs

Total Capital Outlay (6600) 1,397,114(10)

Total Debt & Lease(6500)

Plant Maintenance (Function 51, 6100-6400)

Food (Function 35, 6341 and 6499)

Stipends (6413)

Column 4 (above) - Total Indirect Cost

SubTotal:

Net Allowed Direct Cost

Total Cost of Buildings before Depreciation (1520)

Historical Cost of Building over 50 years old

Amount of Federal Money in Building Cost (Net of #16)

Total Cost of Furniture & Equipment before Depreciation (1530 & 1540)

(8) NOTE A:

-(11)

(12) 50,437,185

(13) 10,808,213

(14) -

10,067,571

72,710,083

472,908,426

1,487,110,435(15)

(16) 8,112,792

(17) -

(18) 53,804,707

$1,175,238 in Function 53 expenditures are included in this report on administrative costs.

$

$

$

$

$

$

$

(9)

Historical Cost of Furniture & Equipment over 16 years old (19) $ 28,808

Amount of Federal Money in Furniture & Equipment (Net of #19) (20) $ -

FISCAL YEAR

CUMULATIVE

$1,914,188 in Function 99 expenditures for appraisal district costs are included in this report on administrative costs.

146


FUND BALANCE AND CASH FLOW CALCULATION WORKSHEET


UNAUDITED

Total General Fund Balance as of 6/30/12 (Exhibit C-1 object 3000 for the General Fund Only)

116,753,975 1 $

Total Non-Spendable Fund Balance (from Exhibit C-1 - for the General Fund Only)

2 2,174,173 $

Total Restricted Fund Balance (from Exhibit C-1 - for the General Fund Only)

3 -

Total Committed Fund Balance (from Exhibit C-1 - for the General Fund Only)

4 -

Total Assigned Fund Balance (from Exhibit C-1 - for the General Fund Only)

5 -

6 Estimated amount needed to cover fall cash flow deficits in the General Fund (Net of borrowed funds and funds representing deferred revenues.)

-

7 Estimate of two month's average cash disbursements during the fiscal year. 91,032,976

8

13Excess (Deficit) Unassigned Fund Balance (Line 1 minus Line 12) (8,367,890)$

12

9

10

11

Estimate of delayed payments from state sources (58xx). 31,867,670

Estimate of underpayment from state sources equal to variance between Legislative Payment Estimate (LPE) and District Planning Estimate (DPE) or District's calculated earned state aid amount.

-

Estimate of delayed payments from federal sources (59xx) 47,046

Estimate of expenditures to be reimbursed to General Fund from Capital Projects Fund (uses of General Fund cash after bond referendum and prior to issuance of bonds)

-

Optimum Fund Balance and Cash Flow (Lines 2+3+4+5+6+7+8+9+10+11) 125,121,865

147

jcoats

Text Box


SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL - CHILD NUTRITION PROGRAM


Control

Data

CodesOriginal Final

(GAAP BASIS)

(Negative)

Positive or


Budgeted Amounts

REVENUES:13,075,493 13,905,915 13,068,015 (7,478)Total Local and Intermediate Sources $ $ $ $5700

728,912 851,712 647,402 (81,510)State Program Revenues5800

17,291,669 16,921,447 17,264,892 (26,777)Federal Program Revenues5900

Total Revenues5020 31,679,074 31,096,074 30,980,309 (115,765)

EXPENDITURES:31,356,539 30,072,539 29,616,160 1,740,379 Food Services0035

1,424,000 1,291,000 1,322,612 101,388 Facilities Maintenance and Operations0051

200,500 202,500 194,054 6,446 Security and Monitoring Services0052

Total Expenditures6030 31,566,039 32,981,039 31,132,826 1,848,213


113,035 (1,884,965) (152,517) 1,732,448

OTHER FINANCING SOURCES (USES): - - 1,824 1,824 Sale of Real and Personal Property7912

Total Other Financing Sources (Uses) 7080 - - 1,824 1,824

1200 Net Change in Fund Balances 113,035 (1,884,965) (150,693) 1,734,272


3000 Fund Balance - June 30 (Ending) $ 9,317,744 $ 7,319,744 $ 9,054,016 $ 1,734,272

148


SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL - DEBT SERVICE FUND


Control

Data

CodesOriginal Final

(GAAP BASIS)

(Negative)

Positive or


Budgeted Amounts

REVENUES:98,124,020 96,093,317 98,864,703 740,683 Total Local and Intermediate Sources $ $ $ $5700

18,309 - 18,309 - State Program Revenues5800

1,967,358 1,967,358 1,967,358 - Federal Program Revenues5900

Total Revenues5020 98,060,675 100,109,687 100,850,370 740,683

EXPENDITURES:

Debt Service:46,685,000 46,685,000 46,685,000 - Principal on Long Term Debt0071

60,029,974 60,029,974 60,029,974 - Interest on Long Term Debt0072

10,000 10,000 2,750 7,250 Bond Issuance Cost and Fees0073

Total Expenditures6030 106,724,974 106,724,974 106,717,724 7,250


(8,664,299) (6,615,287) (5,867,354) 747,933

OTHER FINANCING SOURCES (USES): - 1,700,000 - - Capital Related Debt Issued (Regular Bonds)7911

300,000 - 379,566 79,566 Transfers In7915

Total Other Financing Sources (Uses) 7080 1,700,000 300,000 379,566 79,566

1200 Net Change in Fund Balances (6,964,299) (6,315,287) (5,487,788) 827,499


3000 Fund Balance - June 30 (Ending) $ 83,288,131 $ 83,937,143 $ 84,764,642 $ 827,499

149

150



Statistical Section Overview

151

The statistical section is organized in five sections: Financial Trends – Compiles information reported in the Comprehensive Annual Financial

Report over the past ten years. These schedules report how the District’s financial position has changed over time.

Revenue Capacity Information – Provides information regarding the District’s major revenue sources (property taxes) and the stability/growth of revenue.

Debt Capacity Information – Provides information on the District’s outstanding debt, the District’s ability to repay the debt, and its ability to issue additional debt if needed.

Demographic and Economic Information – Provides information regarding the District’s socioeconomic environment; specifically, its taxpayers, employers, and the changes to those groups over the past ten years if possible.

Operating Information – Provides information on the District’s employees, operations of the District, and facilities.

The driving force of the District over the past ten years has been the growth in both the student enrollment and in the population of its taxpayers. The growth has also led to increased property tax valuation. As enrollment has grown, the District has expanded the number of schools funded by issuing taxpayer approved bonds. The expenditures for debt have increased as a percentage of operating expenditures as the debt payments are scheduled over time. Capital expenditures have increased and decreased on an annual basis as construction projects have begun and ended. The District changed its fiscal year-end from August 31st to June 30th effective with the 2004-2005 fiscal period. All years prior to 2004-2005 have an August 31st year-end. The financial information provided in the statistical section in the fiscal year 2005 column represents a 10-month fiscal period. In fiscal year 2007, the District’s funding sources began a transition as a new State funding model was implemented. Property tax rates for maintenance and operations (M&O) were reduced by almost a third over a two-year period as the State of Texas’ funding model was changed thereby reducing local tax revenue. The State increased its funding to compensate for the reduced property taxes, but a revenue cap negates the effect of increased property tax values to the District.


Statistical Section Overview

152

The funding model creates a targeted revenue that is a fixed dollar amount per WADA. Additional revenues are achieved by assessing a property tax rate greater than $1.00 per $100 of assessed property value. Certain elements of State funding are excluded from the target revenue calculation, including elements that are mandated for specific purposes and a partial State match of local taxes assessed greater than $1.00 per $100 of assessed value. For simplicity, all property tax revenue and State entitlements are shown in this schedule. The District cannot raise its M&O tax rate above $1.04 without voter approval. In subsequent years, TEA refined the funding formula including certain items in the base allocation and excluding others. TEA began calling the revenue target, Revenue at the Compressed Tax Rate (RACR). For fiscal year 2011-2012, TEA redefined the calculation of WADA to allocate the State’s $4 billion reduction in its funding of education to districts across the State. The change in the calculation of WADA eliminated comparability in the State’s funding on an annual basis and effectively changed the amount per WADA that a school district would receive. GASB Statement No. 54 was implemented in fiscal year 2010-2011. This statement standardizes the way that governmental entities record fund balances. The alternate presentation is illustrated in the Fund Balances, Governmental Funds – Last Ten Years schedule.

153

Financial Trends


Net Assets by Component Last Ten Years

(Unaudited)

154

2012 2011 2010 2009Governmental ActivitiesInvested in Capital Assets,

Net of Related Debt $ 9,838,474 $ (4,823,192) $ 19,928,986 $ 26,977,086Restricted 115,592,695 152,266,493 142,114,941 132,445,898Unrestricted 98,016,927 59,172,644 48,301,528 46,417,351Total Governmental

Activities Net Assets 223,448,096 206,615,945 210,345,455 205,840,335

Business - Type ActivitiesInvested in Capital Assets

Net of Related Debt 9,916,449 10,307,998 10,616,869 10,936,825Restricted - - - - Unrestricted 4,949,501 3,350,580 1,995,919 816,240Total Business - Type

Activities Net Assets 14,865,950 13,658,578 12,612,788 11,753,065

Primary GovernmentInvested in Capital Assets,

Net of Related Debt 19,754,923 5,484,806 30,545,855 37,913,911Restricted 115,592,695 152,266,493 142,114,941 132,445,898Unrestricted 102,966,428 62,523,224 50,297,447 47,233,591Total Primary

Government Net Assets $ 238,314,046 $ 220,274,523 $ 222,958,243 $ 217,593,400

Source: The District’s Statement of Net Assets (Exhibit A – 1). Note: The negative amount for unrestricted net assets in Business-Type Activities, for fiscal

years 2005 and 2006, is due to the purchase of a building with an interfund loan from the General Fund.

155

2008 2007 2006 2005 2004 2003

$ 4,429,727 $ 17,244,714 $ 30,736,726 $ 45,938,912 $ 43,239,468 $ 25,464,169133,947,467 81,887,808 72,080,152 64,951,051 37,889,775 59,722,275

80,123,040 83,914,665 54,924,547 48,077,268 54,191,373 49,869,760

218,500,234 183,047,187 157,741,425 158,967,231 135,320,616 135,056,204

11,174,285 10,630,346 9,948,185 9,788,183 5,280,357 - - - - - - -

1,185,412 364,614 (490,933) (1,545,534) 2,208,668 1,306,184

12,359,697 10,994,960 9,457,252 8,242,649 7,489,025 1,306,184

15,604,012 27,875,060 40,684,911 55,727,095 48,519,825 25,464,169133,947,467 81,887,808 72,080,152 64,951,051 37,889,775 59,722,275

81,308,452 84,279,279 54,433,614 46,531,734 56,400,041 51,175,944

$ 230,859,931 $ 194,042,147 $ 167,198,677 $ 167,209,880 $ 142,809,641 $ 136,362,388


Governmental Activities Revenues & Expenses Last Ten Years

(Unaudited)

156

June 30, June 30, June 30, June 30, 2012 2011 2010 2009

ExpensesGovernmental Activities:

Instruction $ 362,214,813 $ 376,479,406 $ 371,284,490 $ 370,221,380Instructional Resources & Media Services 11,264,201 12,323,296 11,927,161 11,466,877Curriculum and Staff Development 15,741,780 17,301,176 18,148,005 17,713,747Instructional Leadership 6,421,877 7,179,781 7,334,921 7,241,548School Leadership 31,110,802 33,019,232 32,584,901 31,854,872Guidance, Counseling & Evaluation Services 18,826,969 19,843,188 20,141,865 20,339,981Social Work Services 3,910,851 4,300,158 4,220,795 3,851,827Health Services 7,304,746 7,921,828 7,264,301 7,174,774Student (Pupil) Transportation 19,620,934 20,182,957 18,536,672 17,801,756Food Services 31,703,494 30,085,326 28,443,629 26,488,152Cocurricular/Extracurricular Activities 15,185,517 15,038,573 14,947,235 13,183,671General Administration 10,239,863 11,020,485 11,274,090 9,864,270Plant Maintenance and Operations 55,143,500 58,741,653 58,389,526 55,883,502Security and Monitoring Services 3,697,076 4,467,534 3,899,077 4,103,863Data Processing Services 4,304,519 6,420,067 3,992,606 4,097,008Community Services 2,490,482 575,511 575,229 1,248,806Debt Service - Interest on Long Term Debt 59,422,600 60,636,418 60,720,709 63,527,081Debt Service - Bond Issurance Cost and Fees 302,919 280,228 281,268 281,768Instructional Shared Service Arrangements 395,184 375,125 200,986 297,842Juvenile Justice Alternative Ed Program 129,060 176,333 128,650 9,510Property Tax Assessment 1,914,188 2,180,987 2,255,319 2,383,284

Total Governmental Activities Expense 661,345,375 688,549,262 676,551,435 669,035,519

Program Revenues:Charges for Services - Instruction 5,498,633 4,477,860 3,916,351 5,061,744Charges for Services - Food Service 13,053,012 13,177,449 13,486,056 13,621,294Charges for Services - Cocurricular/

Extracurricular Activities 2,500,124 2,312,500 1,964,590 1,977,886Charges for Services - Community Services 912,809 1,168,935 1,109,892 842,699Charges for Services - Other 819,350 1,491,891 1,348,220 1,527,317Operating Grants and Contributions 93,390,025 102,842,030 103,315,872 74,016,670Total Governmnetal Activities

Program Revenue 116,173,953 125,470,665 125,140,981 97,047,610

Net Governmental ActivitiesRevenue/(Expense) $ (545,171,422) $ (563,078,597) $ (551,410,454) $ (571,987,909)

Source: The District’s Statement of Activities (Exhibit B – 1).

157

June 30, June 30, June 30, June 30, August 31, August 31,2008 2007 2006 2005 2004 2003

$ 341,350,067 $ 314,085,161 $ 284,429,697 $ 244,243,628 $ 250,830,977 $ 244,933,33910,973,149 10,125,720 10,108,732 8,715,066 7,866,406 8,235,57118,451,351 15,000,932 13,293,192 10,736,388 9,275,647 9,505,2686,577,497 6,133,233 5,813,479 4,801,588 5,041,526 5,372,683

30,159,881 27,458,570 25,251,425 22,813,075 22,660,297 22,372,34718,992,370 17,972,102 16,407,171 14,479,464 14,267,861 14,206,5013,042,676 2,682,635 2,250,825 1,769,963 1,672,722 1,684,8676,913,545 6,513,639 6,073,372 5,149,366 5,459,032 5,212,115

16,252,571 14,838,457 14,192,298 12,018,853 12,604,377 12,275,57324,213,815 22,001,433 20,209,784 17,532,620 17,835,429 17,544,66811,655,358 9,617,833 9,159,518 7,860,618 8,647,057 9,657,02412,889,275 15,525,882 10,333,011 10,347,147 11,315,525 12,243,86752,340,812 46,407,501 43,768,619 32,668,361 36,932,524 37,347,7873,693,348 3,231,975 2,794,358 2,674,351 2,845,133 2,715,1004,593,596 3,846,239 3,583,551 4,360,648 2,637,326 3,281,0681,102,363 1,059,993 1,473,221 900,919 1,005,249 892,608

58,684,775 39,677,973 44,515,883 39,561,242 31,816,474 29,776,040173,153 185,189 125,943 195,059 2,704 2,108219,709 400,000 406,000 406,000 359,440 197,188399,150 314,250 704,025 608,775 454,011 359,800

2,163,506 - - - - - 624,841,967 557,078,717 514,894,104 441,843,131 443,529,717 437,815,522

5,069,638 4,876,008 4,617,438 4,109,928 4,677,684 3,790,62212,929,303 12,358,839 11,583,002 10,073,875 9,965,009 9,639,706

2,118,625 1,908,113 1,783,032 1,626,326 1,635,658 1,503,8771,222,149 703,974 601,755 702,995 702,257 703,6631,699,752 1,490,131 1,465,083 1,279,965 1,504,761 1,167,096

67,096,521 60,306,286 61,180,201 52,215,434 51,737,363 54,140,470

90,135,988 81,643,351 81,230,511 70,008,523 70,222,732 70,945,434

$ (534,705,979) $ (475,435,366) $ (433,663,593) $ (371,834,608) $ (373,306,985) $ (366,870,088)


Business – Type Activities Revenues & Expense Last Ten Years

(Unaudited)

158

June 30, June 30, June 30, June 30, 2012 2011 2010 2009

Business - Type Activities Expenses

Property Management $ 763,699 $ 789,220 $ 783,522 $ 699,052Uniform Rental 24,198 41,630 84,854 21,364Community Education 6,465,728 6,519,604 6,223,800 5,662,888Preschool Program for Children

with Disabilities 425,314 308,329 295,147 287,593North East Aquatics and Tennis 574,334 654,430 583,008 514,871

Total Expenses 8,253,273 8,313,213 7,970,331 7,185,768

Charges for ServicesProperty Management 618,215 962,292 1,075,466 1,015,958Uniform Rental 62,982 72,219 63,398 57,971Community Education 7,663,258 7,353,074 6,659,700 6,278,078Preschool Program for Children

with Disabilities 466,302 330,058 326,945 287,188 North East Aquatics Team 697,540 719,099 750,587 653,108

Total Charges for Services 9,508,297 9,436,742 8,876,096 8,292,303

Net Business - Type ActivitiesRevenue/(Expense) $ 1,255,024 $ 1,123,529 $ 905,765 $ 1,106,535

Source: The District’s Statement of Activities – Exhibit B-1

159


$ 661,505 $ 556,402 $ 532,783 $ 501,176 $ 548,312 $ 282,781 12,593 22,793 19,039 34,671 11,319 28,944

5,190,479 4,662,315 4,000,381 2,700,124 2,852,648 1,880,650

97,573 140 - - - - 433,421 364,243 275,996 204,755 266,467 267,230

6,395,571 5,605,893 4,828,199 3,440,726 3,678,746 2,459,605

969,111 839,720 910,225 707,974 704,641 683,04165,556 59,977 53,547 59,232 62,506 51,190

6,010,328 5,737,390 4,684,619 3,120,594 3,516,876 2,074,348

108,281 - - - - - 627,525 522,455 429,411 336,550 335,859 328,823

7,780,801 7,159,542 6,077,802 4,224,350 4,619,882 3,137,402

$ 1,385,230 $ 1,553,649 $ 1,249,603 $ 783,624 $ 941,136 $ 677,797


General Revenues and Changes in Net Assets Last Ten Years

(Unaudited)

160

2012 2011 2010 2009Net (Expense)/ Revenue

Total Primary Government Net Expense $ (543,916,398) $ (561,955,068) $ (550,504,689) $ (570,881,374)

General Revenues and Other Changes in Net AssetsGovernmental Activities:

Taxes Property Taxes, Levied for General Purposes 280,835,492 280,283,586 284,667,647 285,212,528Property Taxes, Levied for Debt Service 98,024,700 97,815,240 99,452,311 99,148,977

State Aid - Unrestricted Formula Grants 169,075,359 171,635,705 159,950,184 148,837,569Grants & Contributions not Restricted 7,146,480 5,308,935 1,830,445 967,287Investment Earnings 3,008,213 2,210,106 4,008,550 19,254,830Miscellaneous Local and Intermediate Revenue 3,865,677 4,042,857 5,960,395 4,193,648Special Item - Gain on Refunding of Escrow - - - - Extraordinary Item - Mold Abatement - - - - Transfers In (Out) 47,652 77,741 46,042 1,713,167

562,003,573 561,374,170 555,915,574 559,328,006Business-Type Activities

Transfers In (Out) (47,652) (77,741) (46,042) (1,713,167)Total General Revenues, Special Items,

and Transfers 561,955,921 561,296,429 555,869,532 557,614,839

Change in Net Assests Total Primary Government $ 18,039,523 $ (658,639) $ 5,364,843 $ (13,266,535)

Source: The District’s Statement of Activities – Exhibit B-1

161

2008 2007 2006 2005 2004 2003

$ (533,320,749) $ (473,881,717) $ (432,413,990) $ (371,050,984) $ (372,365,849) $ (366,192,291)

259,503,032 299,583,797 292,206,575 271,415,894 254,814,377 232,432,11890,758,296 68,054,503 57,289,848 53,185,271 41,457,710 40,921,433

165,028,447 111,243,699 57,262,107 54,439,639 50,043,110 73,305,737613,143 1,322,655 4,068,298 4,680,899 25,541,086 10,042,733

50,290,166 16,659,617 17,647,294 7,459,883 5,310,520 6,712,8953,945,449 3,860,916 3,928,467 3,053,621 4,034,880 4,113,653

- - - 1,216,016 - 3,895,281- - - - - 1,535,000

20,493 15,941 35,000 30,000 (5,241,705) (482,136)570,159,026 500,741,128 432,437,589 395,481,223 375,959,978 372,476,714

(20,493) (15,941) (35,000) (30,000) 5,241,705 482,136

570,138,533 500,725,187 432,402,589 395,451,223 381,201,683 372,958,850

$ 36,817,784 $ 26,843,470 $ (11,401) $ 24,400,239 $ 8,835,834 $ 6,766,559


Fund Balances, Governmental Funds Last Ten Years

(Unaudited)

162

June 30, June 30, June 30, June 30,2012 2011 2010 2009

General FundReserved for:

Investments in Inventory $ - $ - $ 1,754,001 $ 1,669,537Outstanding Encumbrances - - 1,783,846 2,066,473Long Term Investments - - - -

Unreserved Designated for:Potential Contract Termination Fees - - - -

Unreserved and Undesignated:Reported in the General Fund - - 68,356,422 57,266,274

Nonspendable:Inventory 2,174,173 2,039,068 - -

Unassigned 114,579,802 87,641,653 - - General Fund Balance 116,753,975 89,680,721 71,894,269 61,002,284

All Other Governmental FundsReserved, Reported in:

Debt Service Fund - - 76,780,278 72,622,293Capital Projects Fund - - 154,603,142 354,128,459Special Revenue Fund - - 9,097,028 7,538,512

Unreserved Designated, Reported in:Special Revenue Fund - - 2,185,590 2,462,222

Unreserved and Undesignated:Special Revenue Fund - - 99,999 -

NonspendableSpecial Revenue Funds 959,239 693,195 - - Permanent Fund 200,000 - - -

Restricted:Debt Service Fund 82,716,079 88,909,880 - - Capital Projects Fund 43,110,047 104,969,423 - - Special Revenue Fund 8,767,011 9,939,609 - - Permanent Fund 31,827 - - -

CommittedCapital Projects Fund - 1,117,780 - - Special Revenue Fund 2,680,156 2,523,721 - -

Assigned:Debt Service Fund 2,048,563 1,342,550 - -

All Other Governmental Funds Fund Balance 140,512,922 209,496,158 242,766,037 436,751,486

Total Fund Balances $ 257,266,897 $ 299,176,879 $ 314,660,306 $ 497,753,770

General FundBeginning Fund Balance $ 89,680,721 $ 71,894,269 $ 61,002,284 $ 70,993,011Net Change in Fund Balance 27,073,254 17,786,452 10,891,985 (9,990,727)Prior Period Adjustment - - - - Ending Fund Balance $ 116,753,975 $ 89,680,721 $ 71,894,269 $ 61,002,284

Source: The District’s Governmental Funds Balance Sheet, Exhibit C-1

Note: The prior period adjustment in fiscal year 2003-2004 was due to a correction in state revenue recognized in prior years.

163


$ 1,377,357 $ 1,300,122 $ 1,256,561 $ 1,238,457 $ 915,996 $ 994,4162,062,856 1,956,599 1,903,356 2,406,753 972,983 1,139,391

- - - 5,984,710 11,500,000 14,000,000

- 549,888 900,888 1,251,888 1,251,888 2,358,888

67,552,798 75,132,466 61,306,585 57,750,174 38,209,955 26,217,309

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

70,993,011 78,939,075 65,367,390 68,631,982 52,850,822 44,710,004

54,093,988 35,901,648 34,572,263 34,446,128 29,271,743 9,350,516525,348,305 85,653,777 201,524,723 209,517,109 298,896,561 60,896,697

6,920,899 7,164,355 7,002,959 6,165,722 2,635,192 3,163,856

2,201,825 2,268,522 2,003,602 1,925,147 1,662,160 1,587,842

- - - - 2,347,075 2,066,857

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

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

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

- - - - - - 588,565,017 130,988,302 245,103,547 252,054,106 334,812,731 77,065,768

$ 659,558,028 $ 209,927,377 $ 310,470,937 $ 320,686,088 $ 387,663,553 $ 121,775,772

$ 78,939,075 $ 65,367,390 $ 68,631,982 $ 52,850,822 $ 44,710,004 $ 42,335,362(7,946,064) 13,571,685 (3,264,592) 15,781,160 10,022,751 2,374,642

- - - - (1,881,933) - $ 70,993,011 $ 78,939,075 $ 65,367,390 $ 68,631,982 $ 52,850,822 $ 44,710,004


Governmental Fund Revenues Last Ten Years

(Unaudited)

164

2012 2011 2010 2009Local Revenues

Property Taxes $ 377,955,617 $ 377,944,850 $ 382,875,279 $ 384,163,874Penalties, Interest and Other Tax

Related Income 2,467,016 2,878,177 2,824,758 2,995,021Investment Income 2,996,407 2,168,184 5,850,374 18,543,846Food Sales 13,053,012 13,179,571 13,486,056 13,621,294Cocurricular Student Activities 1,816,293 1,661,528 1,383,842 1,306,956Other 9,284,872 8,956,859 8,146,656 9,584,487

Total Local Revenues 407,573,217 406,789,169 414,566,965 430,215,478

State RevenuesPer Capita and Foundation 169,075,359 171,630,709 158,858,985 153,419,559Other 35,377,612 32,680,474 32,905,164 28,712,604

Total State Revenues 204,452,971 204,311,183 191,764,149 182,132,163

Federal Revenues 64,333,954 75,448,757 73,307,235 41,587,591

Total Governmental Fund Revenues $ 676,360,142 $ 686,549,109 $ 679,638,349 $ 653,935,232

Source: The District’s Governmental Funds Statement of Revenues, Expenditures, and Changes

in Fund Balance and footnotes.

165

2008 2007 2006 2005 2004 2003

$ 351,152,097 $ 366,036,447 $ 350,159,629 $ 323,259,893 $ 296,474,381 $ 273,890,550

2,726,884 2,896,894 3,127,196 2,213,499 2,609,355 2,455,93849,508,320 15,925,682 17,260,214 7,276,692 5,211,395 6,600,95812,940,978 12,363,007 11,588,403 10,074,102 9,965,010 9,665,6861,371,203 1,586,383 1,401,784 1,052,895 5,990,066 5,369,1429,930,520 8,446,896 7,990,232 7,529,193 3,438,518 2,587,387

427,630,002 407,255,309 391,527,458 351,406,274 323,688,725 300,569,661

171,799,950 111,243,699 57,148,249 54,050,674 67,165,249 74,828,33425,755,762 27,728,555 28,221,855 26,361,802 30,520,939 34,882,698

197,555,712 138,972,254 85,370,104 80,412,476 97,686,188 109,711,032

34,971,068 33,550,268 36,920,438 30,836,904 29,571,056 27,728,207

$ 660,156,782 $ 579,777,831 $ 513,818,000 $ 462,655,654 $ 450,945,969 $ 438,008,900


Governmental Fund Revenues as a Percentage of Total Revenue Last Ten Years

(Unaudited)

166

2012 2011 2010 2009Local Revenues

Property Taxes 55.89% 55.05% 56.34% 58.75%Penalties, Interest and Other Tax

Related Income 0.36% 0.42% 0.42% 0.46%Investment Income 0.44% 0.32% 0.86% 2.84%Food Sales 1.93% 1.92% 1.98% 2.08%Cocurricular Student Activities 0.27% 0.24% 0.20% 0.20%Other 1.37% 1.30% 1.20% 1.47%

Total Local Revenues 60.26% 59.25% 61.00% 65.79%

State RevenuesPer Capita and Foundation 25.00% 25.00% 23.37% 23.46%Other 5.23% 4.76% 4.84% 4.39%

Total State Revenues 30.23% 29.76% 28.22% 27.85%

Federal Revenues 9.51% 10.99% 10.79% 6.36%

Total Governmental Fund Revenues 100.00% 100.00% 100.00% 100.00%

167

2008 2007 2006 2005 2004 2003

53.19% 63.13% 68.15% 69.87% 65.74% 62.53%

0.41% 0.50% 0.61% 0.48% 0.58% 0.56%7.50% 2.75% 3.36% 1.57% 1.16% 1.51%1.96% 2.13% 2.26% 2.18% 2.21% 2.21%0.21% 0.27% 0.27% 0.23% 1.33% 1.23%1.50% 1.46% 1.56% 1.63% 0.76% 0.59%

64.78% 70.24% 76.20% 75.95% 71.78% 68.62%

26.02% 19.19% 11.12% 11.68% 14.89% 17.08%3.90% 4.78% 5.49% 5.70% 6.77% 7.96%

29.93% 23.97% 16.61% 17.38% 21.66% 25.05%

5.30% 5.79% 7.19% 6.67% 6.56% 6.33%

100.00% 100.00% 100.00% 100.00% 100.00% 100.00%

North East Independent School District Governmental Fund Expenditures by Function

Last Ten Years

(Unaudited)

168

2012 2011 2010 2009Instruction $ 329,227,764 $ 338,450,529 $ 341,012,154 $ 328,374,043Instructional Resources & Media Services 8,212,815 9,305,163 8,838,629 8,600,928Curriculum & Instructional Staff Development 15,626,408 17,023,819 17,175,725 16,777,791Instructional Leadership 6,352,202 7,004,924 7,289,535 7,212,442School Leadership 29,409,055 30,842,090 31,509,738 30,818,927Guidance, Counseling & Evaluation Services 18,332,766 19,071,789 19,808,945 20,100,593Social Work Services 3,863,889 4,202,551 4,196,899 3,868,552Health Services 6,939,591 7,431,752 7,037,574 6,914,922Student (Pupil) Transportation 17,214,233 17,331,546 16,582,909 15,987,718Food Services 29,641,367 27,176,913 26,431,893 24,530,646Cocurricular/Extracurricular Activities 9,054,132 9,317,518 9,530,527 9,165,895General Administration 10,240,180 10,672,410 11,232,452 10,738,540Plant Maintenance and Operations 50,456,180 52,669,553 51,540,017 50,303,380Security and Monitoring Services 4,139,986 4,627,130 4,479,701 4,004,227Data Processing Services 3,946,486 5,796,778 3,709,211 3,326,788Community Services 518,024 552,611 576,291 1,234,332Debt Service

Principal on Long-Term Debt 46,685,000 27,290,000 35,330,000 20,035,000 Interest on Long-Term Debt 60,029,974 59,585,817 60,437,916 61,619,960 Bond Issuance Cost and Fees 2,750 365,803 3,790 4,290

Capital Outlay Facilities Acquisition and Construction 65,145,367 85,836,050 204,807,956 189,416,672

Intergovernmental Instructional Shared Service Arrangements 395,184 375,125 200,986 297,842

Juvenile Justice Alternative Ed. Prg. 129,060 176,333 128,650 9,510Property Appraisal Services 1,914,188 2,180,987 2,255,319 2,383,284

Total Expenditures $ 717,476,601 $ 737,287,191 $ 864,116,817 $ 815,726,282

Debt Service as a Percentage ofNoncapital Expenditures 17.6% 13.2% 14.2% 12.5%

Capital Outlay as a Percentage of Operating Expenditures 11.9% 15.2% 36.3% 34.8%


in Fund Balance. NA: Information presentation varied in previous years as detailed data was not available. Note: Operating expenditures exclude debt service and capital outlay amounts.

Noncapital expenditures exclude capital outlay amounts noted in Schedule C-4 and detailed in Footnote II B.

169

2008 2007 2006 2005 2004 2003$ 315,670,149 $ 289,736,951 $ 263,305,073 $ 230,198,578 $ 234,363,558 $ 232,617,596

8,147,961 7,756,138 7,404,464 6,757,954 6,170,877 6,590,97616,060,604 14,165,585 12,673,833 10,674,074 9,272,219 9,558,5906,570,315 6,105,198 5,739,482 4,750,022 5,018,600 5,356,464

29,344,553 26,503,562 24,310,446 21,337,215 22,091,921 21,924,31918,836,979 17,823,883 16,160,404 14,251,840 14,145,926 14,088,8893,024,594 2,669,135 2,218,941 1,751,230 1,649,867 1,665,3246,848,743 6,423,803 5,928,907 5,013,339 5,357,893 5,135,355

15,273,737 15,156,699 13,924,822 11,694,493 12,617,955 12,243,98823,115,479 21,134,535 19,059,956 16,390,119 16,928,667 16,653,5228,728,208 7,305,371 6,853,422 5,996,312 6,749,222 7,564,948

10,873,973 12,873,119 11,796,847 10,393,077 11,381,159 11,070,14046,429,152 42,349,212 39,871,700 30,391,263 34,529,290 34,815,1213,564,780 3,157,616 2,916,185 2,568,214 2,846,672 2,736,7563,346,081 2,861,104 2,626,813 3,260,969 2,423,568 2,336,8341,083,710 1,023,623 1,442,756 887,464 1,016,178 885,973

29,120,000 27,890,000 25,865,000 23,255,000 23,065,000 20,515,00049,035,979 41,477,973 38,546,060 30,731,831 24,858,197 25,649,9062,764,763 1,737,594 1,137,222 116,860 1,463,191 2,108

114,933,305 133,255,321 172,097,723 99,444,506 65,741,302 49,132,630

219,709 400,000 406,000 406,000 359,440 197,188399,150 314,250 704,025 608,775 454,011 359,800

2,163,506 NA NA NA NA NA

$ 715,555,430 $ 682,120,672 $ 674,990,081 $ 530,879,135 $ 502,504,713 $ 481,101,427

13.0% 12.6% 12.8% 12.4% 11.2% 10.6%

22.1% 27.9% 39.4% 26.4% 17.0% 12.7%

North East Independent School District Governmental Fund Expenditures by Function as a Percentage of Total Expenditures

Last Ten Years

(Unaudited)

170

2012 2011 2010 2009Instruction 45.89% 45.90% 39.46% 40.55%Instructional Resources & Media Services 1.14% 1.26% 1.02% 1.05%Curriculum & Instructional Staff Development 2.18% 2.31% 1.99% 2.06%Instructional Leadership 0.89% 0.95% 0.84% 0.88%School Leadership 4.10% 4.18% 3.65% 3.78%Guidance, Counseling & Evaluation Services 2.56% 2.59% 2.29% 2.46%Social Work Services 0.54% 0.57% 0.49% 0.47%Health Services 0.97% 1.01% 0.81% 0.85%Student (Pupil) Transportation 2.40% 2.35% 1.92% 1.96%Food Services 4.13% 3.69% 3.06% 3.01%Cocurricular/Extracurricular Activities 1.26% 1.26% 1.10% 1.12%General Administration 1.43% 1.45% 1.30% 1.32%Plant Maintenance and Operations 7.03% 7.14% 5.96% 6.17%Security and Monitoring Services 0.58% 0.63% 0.52% 0.49%Data Processing Services 0.55% 0.79% 0.43% 0.41%Community Services 0.07% 0.07% 0.07% 0.15%Debt Service

Principal on Long-Term Debt 6.51% 3.70% 4.09% 2.46% Interest on Long-Term Debt 8.37% 8.08% 6.99% 7.55% Bond Issuance Cost and Fees 0.00% 0.05% 0.00% 0.00%

Capital Outlay Facilities Acquisition and Construction 9.08% 11.64% 23.70% 23.22%

Intergovernmental Instructional Shared Service Arrangements 0.06% 0.05% 0.02% 0.04%

Juvenile Justice Alternative Ed. Prg. 0.02% 0.02% 0.01% 0.00%Property Appraisal Services 0.27% 0.30% 0.26% NA

Total Expenditures 100.00% 100.00% 100.00% 100.00%

171

2008 2007 2006 2005 2004 200344.42% 42.48% 39.01% 43.36% 46.64% 48.35%1.14% 1.14% 1.10% 1.27% 1.23% 1.37%2.24% 2.08% 1.88% 2.01% 1.85% 1.99%0.92% 0.90% 0.85% 0.89% 1.00% 1.11%4.10% 3.89% 3.60% 4.02% 4.40% 4.56%2.63% 2.61% 2.39% 2.68% 2.82% 2.93%0.42% 0.39% 0.33% 0.33% 0.33% 0.35%0.96% 0.94% 0.88% 0.94% 1.07% 1.07%2.13% 2.22% 2.06% 2.20% 2.51% 2.54%3.23% 3.10% 2.82% 3.09% 3.37% 3.46%1.22% 1.07% 1.02% 1.13% 1.34% 1.57%1.52% 1.89% 1.75% 1.96% 2.26% 2.30%6.49% 6.21% 5.91% 5.72% 6.87% 7.24%0.50% 0.46% 0.43% 0.48% 0.57% 0.57%0.47% 0.42% 0.39% 0.61% 0.48% 0.49%0.15% 0.15% 0.21% 0.17% 0.20% 0.18%

4.07% 4.09% 3.83% 4.38% 4.59% 4.26%6.85% 6.08% 5.71% 5.79% 4.95% 5.33%0.39% 0.25% 0.17% 0.02% 0.29% 0.00%

16.06% 19.54% 25.50% 18.73% 13.08% 10.21%

0.03% 0.06% 0.06% 0.08% 0.07% 0.04%0.06% 0.05% 0.10% 0.11% 0.09% 0.07%

NA NA NA NA NA NA

100.00% 100.00% 100.00% 100.00% 100.00% 100.00%


Governmental Fund Other Sources, Uses And Changes in Fund Balance

Last Ten Years

(Unaudited)

172

2012 2011 2010 2009

Excess of Revenues over

(Under) Expenditures $ (41,116,459) $ (50,738,082) $ (184,478,468) $ (161,791,050)

Other Financing Sources (Uses)

Refunding Bonds Issued - - - -

Capital-related Debt Issued 37,545,000 - -

Sale of Real and Personal Property 1,824 - - 2,725

Transfers In 982,917 2,298,538 2,176,579 2,449,637

Premium or Discount on

Issuance of Bonds - - - -

Prepaid Interest - - - -

Other Resources - - - -

Other Uses - - - -

Transfers Out (Use) (1,778,265) (2,563,797) (791,575) (2,465,570)

Payment to Bond Refunding

Escrow Agent (Use) - - - -

Total Other Financing Sources(Uses) (793,524) 37,279,741 1,385,004 (13,208)

Special Item - Property Tax Protest - - - -

Extraordinary Item - Mold Abatement - - - -

Special Item - Resource - - - -

Total Special and Extraordinary Items - - - -

Net Change in Fund Balances $ (41,909,983) $ (13,458,341) $ (183,093,464) $ (161,804,258)


in Fund Balances.

173

2008 2007 2006 2005 2004 2003

$ (55,398,648) $ (161,172,081) $ (68,223,481) $ (51,558,744) $ (43,092,527) $ (96,764,704)

- 246,795,000 124,580,000 - 189,743,384 -

488,590,965 - 149,000,000 - 300,000,000 -

20,718 - 11,497 - 57,925 20,000

9,364,856 9,286,859 4,855,328 5,235,544 622,895 2,800,869

16,397,123 38,075,706 9,385,246 - 38,051,022 -

- - - - 2,778,663 -

- - - - - -

- - - - 449,175 -

(9,344,363) (9,221,829) (5,102,328) (5,205,544) (632,895) (3,277,057)

- (283,136,459) (131,772,813) - (211,235,063) -

505,029,299 1,799,277 150,956,930 30,000 319,835,106 (456,188)

- - - - - 3,895,281

- - - - - 1,535,000

- - - 1,216,016 - -

- - - - - 5,430,281

$ 449,630,651 $ (159,372,804) $ 82,733,449 $ (51,528,744) $ 276,742,579 $ (91,790,611)


General Fund Revenues Per ADA

Last Ten Years

(Unaudited)

174

Local Tuition Per CapitaFiscal Maintenance From andYear Tax Patrons Other Total Foundation Other Total

2003 $ 4,618.85 $ 17.42 $ 77.86 $ 4,714.12 $ 1,440.47 $ 284.11 $ 1,724.582004 4,919.64 17.44 87.66 5,024.74 1,284.54 293.90 1,578.442005 5,056.70 19.43 80.08 5,156.22 987.80 287.54 1,275.342006 5,289.47 16.05 129.88 5,435.40 1,024.99 264.87 1,289.862007 5,249.15 18.22 156.92 5,424.30 1,941.19 310.80 2,251.992008 4,508.39 15.43 160.52 4,684.35 2,831.16 361.13 3,192.302009 4,810.40 22.42 82.29 4,915.11 2,491.25 367.94 2,859.192010 4,650.48 8.69 62.05 4,721.23 2,583.91 379.82 2,963.732011 4,504.47 9.63 61.17 4,575.26 2,737.50 377.84 3,115.342012 4,432.50 10.95 62.02 4,505.47 2,642.74 346.65 2,989.39

* Average Daily Attendance is the average daily attendance of eligible enrollees,District-wide, over the number of instructional days in a school year.

** Average Daily Membership is the average daily enrollment of students, District-Wide, based on the first week of October membership.

Local and Intermediate Sources State Sources

Source: General Fund revenue was obtained from the Statement of Revenues, Expenditures,

and Changes in Fund Balance for each respective year. These amounts were then divided by the ADA amounts in the respective CAFR.

175

PercentageIncrease

Ratio of of Average* ** Average Daily Daily

Vocational Total Average Average Attendance to AttendanceFederally and All Daily Daily Average Daily Over

Distributed Other Total Sources Attendance Membership Membership Prior Year

$ 12.35 $ 35.18 $ 47.53 $ 6,486.23 50,890 54,092 94.08 3.636.66 22.56 29.22 6,632.40 52,287 55,316 94.52 2.757.10 32.97 40.07 6,471.63 53,843 56,630 95.08 2.98

11.08 14.55 25.63 6,750.90 55,866 58,699 95.17 3.7611.61 9.58 21.19 7,697.47 57,307 60,170 95.24 2.585.79 13.36 19.15 7,895.79 58,290 61,041 95.49 1.72

11.55 9.66 21.21 7,795.51 59,744 62,288 95.92 2.4957.31 9.10 66.41 7,751.36 61,480 64,351 95.54 2.9181.57 14.85 96.42 7,787.03 62,698 65,454 95.79 1.9887.56 12.75 100.31 7,595.18 63,642 66,198 96.14 1.51

Federal Sources


General Fund Expenditures Per ADA

Last Ten Years

(Unaudited)

176

Instruction and Instructional SupportAverage Instructional- and Services – Administrative

Fiscal Daily Related School Student SupportYear Attendance Services Leadership (Pupil) Services

2003 50,890 $ 4,301.00 $ 512.06 $ 757.02 $ 215.212004 52,287 4,261.04 502.47 735.97 216.712005 53,843 4,102.77 469.11 672.56 192.172006 55,866 4,532.64 519.83 749.96 210.142007 57,307 4,926.97 554.84 792.07 224.482008 58,290 5,251.17 603.25 842.94 186.552009 59,744 5,289.20 619.36 865.67 179.742010 61,480 4,955.87 598.29 863.00 182.702011 62,698 4,875.05 583.90 854.29 169.732012 63,642 4,696.81 545.42 816.05 160.35

Note: Average Daily Attendance (ADA) obtained from PEIMS reports via the Texas Education Agency website.

The Per ADA Expenditures are calculated by summing the functional categories (1X, 2X,

etc) from the respective General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance and then dividing by the ADA.

177

Support Facilitiese Services – Acquisition Inter-

Nonstudent Ancillary and GovernmentalBased Services Construction Charges Total

$ 716.63 $ 3.93 $ 5.66 $ 10.94 $ 6,522.46698.30 2.89 - 15.56 6,432.93624.70 2.87 0.95 18.85 6,083.97752.38 3.64 19.43 19.87 6,807.89788.15 2.66 3.52 12.46 7,305.16864.97 4.13 76.61 47.73 7,877.34923.22 5.10 0.70 45.04 7,928.03946.75 4.42 - 42.05 7,593.08945.21 3.42 0.13 43.58 7,475.31891.84 3.09 0.08 38.31 7,151.96

178


179

Revenue Capacity Information


Assessed and Actual Value of Taxable Property Last Ten Years

(Unaudited)

180

Fiscal Real PersonalYear Property Property Total

2003 * $ 12,929,064,785 $ 1,797,827,505 $ 14,726,892,290 5.78 %2004 * 14,474,411,989 1,906,166,220 16,380,578,209 11.232005 ** 16,035,178,342 2,111,674,835 18,146,853,177 10.782006 ** 17,394,346,513 2,216,373,331 19,610,719,844 8.072007 ** 19,905,740,339 2,172,714,103 22,078,454,442 12.582008 ** 23,028,003,689 2,050,469,368 25,078,473,057 13.592009 ** 25,750,815,923 1,884,830,105 27,635,646,028 10.202010 ** 26,055,087,119 1,671,508,400 27,726,595,519 0.332011 ** 25,471,284,514 2,641,576,795 28,112,861,309 1.392012 ** 25,317,364,002 2,641,805,632 27,959,169,634 (0.55)

Source: * Bexar County Tax Assessor/Collector

** NEISD Tax Consultant/Bexar County Tax Assessor/Bexar Appraisal District

Valuation

Assessed ValueChange inAssessed

Note: Texas appraises property at estimated market valuation. Therefore, the assessed

valuation is at 100% of market value for all years shown.

181

Total Gross Net Direct

Assessed Assessed Tax Value State Local Value Rate

$ 16,924,334,751 $ 1,818,950,584 $ 378,491,877 $ 14,726,892,290 1.76400018,705,146,597 2,061,711,920 262,856,468 16,380,578,209 1.74400020,676,764,539 2,263,987,079 265,924,283 18,146,853,177 1.79400022,657,097,685 2,773,097,368 273,280,473 19,610,719,844 1.79400025,434,877,348 3,073,314,762 283,108,144 22,078,454,442 1.66900029,204,137,043 3,833,946,848 291,717,138 25,078,473,057 1.40290031,995,175,002 4,058,899,209 300,629,765 27,635,646,028 1.40290032,129,108,292 4,099,097,576 303,415,197 27,726,595,519 1.40290031,249,082,566 2,698,993,941 437,227,316 28,112,861,309 1.40290031,179,120,474 2,770,085,256 449,865,584 27,959,169,634 1.402900

Property Tax Exemptions


Direct and Overlapping Property Tax Rates Last Ten Years

(Unaudited)

182

2012 2011 2010 2009Direct Tax Rate Maintenance and Operations $ 1.040000 $ 1.040000 $ 1.040000 $ 1.040000

Interest and Sinking 0.362900 0.362900 0.362900 0.362900Total Direct Tax Rate $ 1.402900 $ 1.402900 $ 1.402900 $ 1.402900

Overlapping Tax RatesAlamo Community College District $ 0.141623 $ 0.141623 $ 0.135855 $ 0.135855Bexar County 0.296187 0.296187 0.296187 0.289399Bexar County Road & Flood 0.030679 0.030679 0.030679 0.037467San Antonio River Authority 0.017370 0.016652 0.015951 0.015951University Health System 0.276235 0.276235 0.266235 0.261022Balcones Heights, City of 0.572199 0.558843 0.510481 0.490729Bexar County Emergency District # 1 0.100000 0.100000 0.100000 0.100000Bexar County Emergency District # 3 0.034532 0.034300 0.030772 0.030000Castle Hills, City of 0.501345 0.501345 0.458668 0.425801Cibolo Canyons Special

Improvement District 0.565690 0.565690 0.565690 0.567140Hill Country Village 0.095000 0.095000 0.095000 0.090500Hollywood Park 0.536710 0.490000 0.490000 0.382261Live Oak, City of 0.477291 0.476783 0.449369 0.405131San Antonio, City of 0.565690 0.565690 0.565690 0.567140Terrell Hills, City of 0.385068 0.385068 0.391301 0.399293Windcrest, City of 0.436495 0.436495 0.436495 0.436227

Total Overlapping Tax Rates 5.032114 4.970590 4.838373 4.633916

Total Direct andOverlapping Tax Rate $ 6.435014 $ 6.373490 $ 6.241273 $ 6.036816

Note: The District was subject to a maximum Maintenance & Operations Tax Rate of $1.50 per

hundred dollars of assessed valuation for all years prior to fiscal 2007. For fiscal 2007, the District had a maximum of $1.37 per hundred dollars of valuation. For fiscal 2008 and beyond, the District’s tax rate had a maximum of $1.04 without voter approval.

183

2008 2007 2006 2005 2004 2003

$ 1.040000 $ 1.360000 $ 1.500000 $ 1.500000 $ 1.500000 $ 1.5000000.362900 0.309000 0.294000 0.294000 0.244000 0.264000

$ 1.402900 $ 1.669000 $ 1.794000 $ 1.794000 $ 1.744000 $ 1.764000

$ 0.134550 $ 0.137500 $ 0.107050 $ 0.107050 $ 0.107050 $ 0.1070500.295104 0.314147 0.318471 0.318471 0.318470 0.3209520.031762 0.012719 0.012719 0.012719 0.012719 0.0127190.015951 0.015951 0.016450 0.016425 0.016450 0.0164500.237408 0.243869 0.243869 0.243869 0.243869 0.2438690.498356 0.532404 0.558500 0.527030 0.527030 0.5635670.097848 0.100000 0.100000 0.100000 0.100000 0.1000000.031222 0.035200 0.051000 0.060000 0.000000 0.0000000.425801 0.458908 0.479634 0.503747 0.503750 0.505518

0.057230 0.000000 0.000000 0.000000 0.000000 0.0000000.905000 0.090500 0.095000 0.095000 0.094950 0.0949500.381464 0.395908 0.417926 0.417926 0.417926 0.4179260.364400 0.385000 0.410000 0.465000 0.465000 0.3350000.572300 0.578450 0.578540 0.578540 0.578540 0.5785400.430422 0.465853 0.516864 0.544500 0.554500 0.5549000.407239 0.412454 0.412622 0.332654 0.332650 0.2829754.886057 4.178863 4.318645 4.322931 4.272904 4.134416

$ 6.288957 $ 5.847863 $ 6.112645 $ 6.116931 $ 6.016904 $ 5.898416


Property Tax Levies and Collections Last Ten Years

(Unaudited)

184

Adjusted Tax Collections Total Collections to DateFiscal Levy for the Current in Subsequent Year Fiscal Year Collections Years Amount

2003 $ 275,435,456 $ 269,897,758 97.99 % $ 5,537,698 $ 275,435,456 100.00 %2004 296,638,910 292,180,226 98.50 3,955,886 296,136,112 99.832005 332,997,163 316,712,081 95.11 15,794,997 332,507,078 99.852006 349,443,708 336,761,086 96.37 12,196,935 348,958,021 99.862007 366,587,967 353,471,532 96.42 12,569,276 366,040,808 99.852008 350,333,397 335,619,453 95.80 13,961,735 349,581,188 99.792009 383,319,907 368,364,241 96.10 14,210,162 382,574,403 99.812010 385,000,198 369,026,838 95.85 13,685,470 382,712,308 99.412011 380,222,986 365,484,001 96.12 11,485,790 376,969,791 99.142012 380,983,917 362,853,349 95.24 - 362,853,349 95.24

of Levy of LevyPercentagePercentage


Principal Property Taxpayers Current Year and Nine Years Prior

(Unaudited)

185

Percentage Percentage

2012 of Total 2003 of Total

Assessed Assessed Assessed Assessed 2003

Name Valuation Valuation Valuation Valuation Rank

Methodist Healthcare Systems SA $ 226,119,960 0.81% $ - -

VHS San Antonio PRTNR 161,097,810 0.58% 55,696,677.0 0.38% 3

North Star Mall, Inc. 132,958,380 0.48% 106,933,894 0.73% 1

HEB Grocery 120,501,993 0.43% - -

Frankel Family Trust 69,161,578 0.25% - -

Target 66,709,570 0.24% - -

AT & T (Southwestern Bell) 80,228,524 0.29% 96,262,809 0.65% 2

Wal-Mart 80,716,630 0.29% - -

DDR DB SA Ventures, LP 78,175,760 0.28% - -

PN Investment Plaza LP 72,675,480 0.26% - -

Lowe's Home Centers, Inc. - - 44,044,868.0 0.30% 4

Alamo Cement - - 38,897,923 0.27% 5

Capital Aggregates - - 40,040,816 0.26% 6

Northwood Partners LTD - - 38,557,824 0.26% 7

DDRA Community Center - - 37,865,759 0.26% 8

Westminster Harcourt LP - - 35,328,358 0.24% 9

Time Warner Cable - - 29,936,255 0.20% 10

$ 1,088,345,685 3.89% $ 523,565,183 3.55%

Source: Information for current year Principal Taxpayers was provided by the Bexar Appraisal

District. The information for 2003 was obtained from the CAFR for fiscal 2002-2003. Note: No information is presented in either year if the taxpayer was not in the top ten principal

taxpayers for that year.


Allocation of Tax Rates and Levies Last Ten Years

(Unaudited)

186

Debt DebtFiscal General Service General ServiceYear Fund Fund Total Fund Fund Total

2003 $ 1.500000 $ 0.264000 $ 1.764000 $ 234,200,570 $ 41,219,312 $ 275,419,8822004 1.500000 0.244000 1.744000 255,245,491 41,519,948 296,765,4392005 1.500000 0.294000 1.794000 268,559,465 52,637,655 321,197,1202006 1.500000 0.294000 1.794000 293,010,722 57,430,101 350,440,8232007 1.360000 0.309000 1.669000 299,393,866 68,024,047 367,417,9132008 1.040000 0.362900 1.402900 260,696,401 90,968,004 351,664,4052009 1.040000 0.362900 1.402900 285,951,059 99,780,422 385,731,4812010 1.040000 0.362900 1.402900 287,397,759 100,285,237 387,682,9962011 1.040000 0.362900 1.402900 282,631,641 98,622,137 381,253,7782012 1.040000 0.362900 1.402900 282,431,587 98,552,330 380,983,917

Source: Bexar County Tax Assessor/Collector October 1 Tax RollThe basis for the property tax rate is $100 assessed valuation.

Tax Rates Tax Levies

187

Debt Capacity Information


Outstanding Debt by Type Last Ten Years

(Unaudited)

188

Limited General Capital Tax Total Debt

Fiscal Obligation Appreciation Refunding Maintenance Primary PerYear Bonds Bonds Bonds Notes Government Capita

2003 $ 469,120,000 $ 43,986,912 $ - $ - $ 513,106,912 5.4 % $ 1,4622004 565,625,000 37,647,681 189,435,000 - 792,707,681 7.9 2,2242005 553,995,000 30,080,358 188,490,000 - 772,565,358 7.2 2,1152006 564,800,000 21,464,915 311,580,000 - 897,844,915 7.9 2,4532007 339,500,000 11,683,371 498,840,000 - 850,023,371 7.0 2,3122008 743,575,000 74,574,669 494,415,000 - 1,312,564,669 10.1 3,4952009 731,350,000 77,717,580 486,605,000 - 1,295,672,580 9.2 3,3732010 712,400,000 72,562,166 478,370,000 - 1,263,332,166 8.9 3,2172011 702,870,000 66,180,373 469,755,000 37,545,000 1,276,350,373 8.9 3,2182012 692,965,000 49,536,136 451,780,000 37,545,000 1,231,826,136 NA 2,999

Percentage of Personal

Income

Source:

Debt information was obtained from the District’s CAFR in the corresponding year. The per capita and personal income information was obtained for San Antonio Metropolitan area from the Texas Workforce Commission’s Web site. NA – Not Available


Direct and Overlapping Debt As of June 30, 2012

(Unaudited)

189

Estimated Shareof Direct and

Debt OverlappingGovernmental Unit Outstanding As of Debt

City of San Antonio $ 1,256,035,000 6/30/2012 33.63 % $ 422,404,571Bexar County 962,710,000 6/30/2012 28.01 269,655,071Alamo Community College District 546,995,000 6/30/2012 28.01 153,213,300University Health System 733,350,000 6/30/2012 28.01 205,411,335San Antonio River Authority 34,265,000 6/30/2012 26.93 9,227,565City of Live Oak 17,640,000 6/30/2012 36.07 6,362,748City of Terrell Hills 10,645,000 6/30/2012 11.07 1,178,402City of Windcrest 905,000 6/30/2012 100.00 905,000City of Balcones Heights 1,285,000 6/30/2012 56.72 728,852 Cibolo Canyons Special ID 21,430,000 6/30/2012 100.00 21,430,000 Hill Country Village 1,070,000 6/30/2012 100.00 1,070,000

Subtotal, Overlapping Debt 1,091,586,842 District Direct Debt 1,231,826,136

Total Direct and Overlapping Debt $ 2,323,412,978

PercentageApplicable

Estimated

Source:

The Municipal Advisory Council of Texas.

NOTE: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the District. The overlapping percentage represents an estimate of the overlapping geographic area between the District and the respective governments listed above. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses within the boundaries of the District. This process recognizes that, when considering the District's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government.


Debt Margin Information Last Ten Years

(Unaudited)

190

2012 2011 2010 2009

Debt Limit – 10% of Assessed Valuation $ 2,795,916,963 $ 2,811,286,131 $ 2,772,659,552 $ 2,763,564,603

Outstanding Bonds 1,231,826,136 1,276,350,373 1,263,332,166 1,295,672,580

Less: Amounts Set Aside to Repay

General Debt in Debt Service Fund 84,764,642 90,252,430 76,780,278 72,622,293

Applicable Debt 1,147,061,494 1,186,097,943 1,186,551,888 1,223,050,287

Debt Margin $ 1,648,855,469 $ 1,625,188,188 $ 1,586,107,664 $ 1,540,514,316

Debt Margin as a Percentage of the Debt Limit 58.97% 57.81% 57.21% 55.74%

(Debt Margin Divided by Debt Limit)

General Fund fund balance as a percentage of revenue 24.15% 18.37% 14.73% 12.49%

Total Assets per Statement of Net Assets 1,621,128,810 1,652,913,233 1,649,593,434 1,701,369,551

Debt as a Percentage of Assets per Statement of Net Assets 75.99% 77.22% 76.58% 76.15% Note: Texas Statutes do not prescribe a legal debt limit. For comparison purposes, a 10% debt limit

has been used in this schedule.

191

2008 2007 2006 2005 2004 2003

$ 2,507,847,306 $ 2,207,845,444 $ 1,961,071,984 $ 1,814,685,317 $ 1,638,057,821 $ 1,472,689,229

1,312,564,669 850,023,371 897,844,915 772,564,858 792,707,681 513,106,912

54,093,988 35,901,648 34,572,263 34,446,128 29,271,743 9,350,516

1,258,470,681 814,121,723 863,272,652 738,118,730 763,435,938 503,756,396

$ 1,249,376,625 $ 1,393,723,721 $ 1,097,799,332 $ 1,076,566,587 $ 874,621,883 $ 968,932,833

49.82% 63.13% 55.98% 59.33% 53.39% 65.79%

14.90% 16.95% 14.20% 15.56% 14.01% 12.83%

1,713,754,465 1,187,995,548 1,202,398,088 1,066,405,581 1,017,398,115 695,463,357

76.59% 71.55% 74.67% 72.45% 77.92% 73.78%


Debt to Net Assessed Valuation Last Ten Years

(Unaudited)

192

*Average ** Net Total

Fiscal Daily Estimated Assessed BondedYear Membership Population Value Debt

2003 54,092 350,951 $ 14,726,892,290 $ 513,106,9122004 55,316 356,479 16,380,578,209 792,707,6812005 56,630 365,297 18,146,853,177 772,565,3582006 58,699 366,038 19,610,719,844 897,844,9152007 60,170 367,684 22,078,454,442 850,023,3712008 61,041 375,592 25,078,473,057 1,312,564,6692009 62,288 384,156 27,635,646,028 1,295,672,5802010 64,351 392,720 27,726,595,519 1,263,332,1662011 65,454 396,578 28,112,861,309 1,276,350,3732012 66,198 410,746 27,959,169,634 1,231,826,136

* Average Daily Membership is the District-wide average daily enrollment of students basedon the first week of October membership. Prior years' ADM reflects the average for theentire school year based on final report of ADA and ADM.

** Source: See the Demographic and Economic schedule in the following section.

*** Amount includes accreted portion of capital appreciation bonds

193

Debt Per Net Debt Service Net Average Ratio to Ratio ToFund Bonded Daily Assessed Per Assessed

Balance Debt Membership Valuation Capita Valuation

$ 9,350,516 $ 503,756,396 $ 9,313 3.42 $ 1,435 3.4829,271,743 763,435,938 13,801 4.66 2,142 4.8434,446,128 738,119,230 13,034 4.07 2,021 4.2634,572,263 863,272,652 14,707 4.40 2,358 4.5835,901,648 814,121,723 13,530 3.69 2,214 3.8554,093,988 1,258,470,681 20,617 5.02 3,351 5.2372,622,293 1,223,050,287 19,636 4.43 3,184 4.6976,780,278 1,186,551,888 18,439 4.28 3,021 4.5690,252,430 1,186,097,943 18,121 4.22 2,991 4.5484,764,642 1,147,061,494 17,328 4.10 2,793 4.41

Net Debt


Bonded Debt to Operating Expenditures Last Ten Years

(Unaudited)

194

Ratio ofInterest Total Total Debt Service

Fiscal and Debt General to GeneralYear Principal Fees Service Expenditures Expenditures

2003 $ 20,515,000 $ 25,652,014 $ 46,167,014 $ 331,927,894 13.9 %2004 23,065,000 26,321,388 49,386,388 336,358,537 14.72005 23,255,000 30,848,691 54,103,691 327,579,097 16.52006 25,865,000 39,683,282 65,548,282 380,329,322 17.22007 27,890,000 43,215,567 71,105,567 418,636,700 17.02008 29,120,000 51,800,742 80,920,742 459,170,221 17.62009 20,035,000 61,624,250 81,659,250 473,652,066 17.22010 35,330,000 60,437,916 95,767,916 466,822,696 20.52011 27,290,000 59,585,818 86,875,818 468,687,096 18.52012 46,685,000 60,029,974 106,714,974 455,164,878 23.4

* Accreted portion of bonds included in principal rather than interest amount forcapital appreciation bonds.

Source: The District’s CAFR.


Outstanding Debt by Issuance Date

(Unaudited)

195

Date Date Amount Amount At Issue Authorized Issued Authorized Issued June 30, 2012

Unlimited Tax School Building Bonds - Series 1999 9/23/1998 1/1/1999 $ 366,870,000 $ 211,000,000 $ 10,975,000

Unlimited Tax School Building Bonds - Series 2004 11/14/2003 1/15/2005 300,000,000 300,000,000 156,845,000

Unlimited Tax Refunding Bonds - Series 2004 NA 11/1/2004 NA 189,435,000 133,360,000

Unlimited Tax Refunding Bonds - Series 2004* NA 11/2/2004 NA 308,384 1,007,636

Unlimited Tax School Building Bonds - Series 2005 11/14/2003 9/13/2005 149,000,000 149,000,000 108,145,000



Unlimited Tax School Building Bonds - Series 2007A* 5/12/2007 7/15/2007 498,000,000 71,590,965 48,528,500

Unlimited Tax School Building Bonds - Series 2007A 5/12/2007 7/15/2007 417,000,000 417,000,000

Issuance subtotal 498,000,000 488,590,965 465,528,500

Limited Maintenance Tax Qualified School Construction

Notes Series 2010 8/9/2010 10/1/2010 37,545,000 37,545,000 37,545,000

Total of all issuances $ 1,313,870,000 $ 1,865,579,349 $ 1,231,826,136

* Denotes Capital Appreciation Bonds

196


197

Demographic and Economic Information


Demographic and Economic Information Last Ten Years

(Unaudited)

198

Per Assessed Capita Valuation

Fiscal Personal Personal of Taxable WealthYear Population Income Income Property Per ADA

2003 350,951 $ 9,570,082,819 $ 27,269 6.0 % $ 14,726,892,290 $ 289,387 $2004 356,479 10,005,652,572 28,068 5.9 16,380,578,209 313,2822005 365,297 10,706,124,476 29,308 5.3 18,146,853,177 337,0332006 366,038 11,434,661,082 31,239 4.8 19,610,719,844 351,0312007 367,684 12,115,923,168 32,952 4.3 22,078,454,442 385,2662008 375,592 13,039,803,056 34,718 4.2 25,078,473,057 430,2362009 384,156 14,040,133,488 36,548 5.8 27,635,646,028 462,5682010 392,720 14,249,845,200 36,285 7.2 27,726,595,519 450,9862011 396,578 14,418,386,346 36,357 7.5 28,112,861,309 448,3852012 410,746 NA NA 6.7 27,959,169,634 439,319

RateUnemployment

Note: ADA information is available on the following page. WADA is available in the General Fund Revenue Trends

Source: Population estimates are provided as follows:

The District’s Department of Planning and Research, indexed to 2000 Census for 2002-2005.

U.S. Census Bureau’s American Community Survey for 2006-2011. Per capita income information was obtained from the U.S. Department of Commerce Bureau of Economic Analysis. San Antonio metropolitan area information was used to provide consistent historical information in this schedule. The personal income total equals the District’s population estimate multiplied by San Antonio metropolitan area per capita income. Unemployment rate information was obtained from the U.S. Department of Labor Bureau of Labor Statistics website for the San Antonio Metropolitan area. It is an average for the fiscal year.


Student Demographic Information Last Ten Years

(Unaudited)

199

Average Average Fiscal Daily Daily Increase/Year Attendance Membership (Decrease)

2003 50,890 6.38 % 54,092 6.07 % 35.6 % 0.602004 52,287 2.75 55,316 2.26 36.8 1.202005 53,843 2.98 56,630 2.38 37.2 0.402006 55,866 3.76 58,699 3.65 38.2 1.002007 57,307 2.58 60,170 2.51 36.5 (1.70)2008 58,290 1.72 61,041 1.45 39.1 2.602009 59,744 2.49 62,288 2.04 39.8 0.702010 61,480 2.91 64,351 3.31 42.7 2.902011 62,698 1.98 65,454 1.71 43.3 0.602012 63,642 1.51 66,198 1.14 45.1 1.83

PercentageEconomically

DisadvantagedStudents

Percentage Change

Percentage Change

Source: ADA, ADM, and the percentage of Economically Disadvantaged Students were obtained

from Academic Excellence Indicator System and Public Education Management Information System reports from TEA.

Note: The economically disadvantaged students equal the percentage of students who were

eligible for free and reduced meals at District facilities.


Principal Employers Current Year

(Unaudited)

200

2011 2002

Percentage Percentage of Total of Total

Employer Employees Employment Employees Rank Employment

Lackland Air Force Base 52,561 6.32%Fort Sam Houston 32,000 3.85% 8,527 4 1.16%Randolph AFB 16,017 1.93%USAA 15,000 1.80% 16,267 1 2.21%H.E.B. Food Stores 14,588 1.75%Northside ISD 12,244 1.47% 10,393 3 1.41%City of San Antonio 12,211 1.47% 12,025 2 1.63%North East ISD 8,766 1.05% 7,600 6 1.03%Methodist Healthcare System 7,747 0.93%Baptist Healthcare System 6,310 0.76% 4,384 10 0.59%University of Texas Health Science 5,200 8 0.71%San Antonio ISD 8,000 5 1.09%SBC Communications (AT&T) 6,500 7 0.88%University Health Systems 4,408 9 0.60%

177,444 21.33% 83,304 11.30%

Source: City of San Antonio Comprehensive Annual Financial Report for the Year Ended September 30, 2011. The current year information was not available. The City of San Antonio’s report did not reflect the District’s employment figures and the schedule was updated to correct that omission.


Commercial and Residential Construction Last Ten Years

($000s)

(Unaudited)

201

Year Permits Value Permits Value

2002/2003 2,726 $ 805,505 11,029 $ 558,6862003/2004 3,190 1,370,608 12,343 801,3872004/2005 2,988 1,333,374 10,568 731,5662005/2006 4,047 1,840,573 15,349 1,082,7392006/2007 4,351 1,919,058 13,215 746,0112007/2008 4,461 2,486,582 4,020 429,5082008/2009 5,230 1,762,510 3,781 333,1442009/2010 6,238 1,309,314 4,753 358,4012010/2011 6,545 1,218,426 4,325 292,0672011/2012 7,468 1,888,065 4,573 319,130

Source: City of San Antonio Development Services Department

Commercial Construction Residential Construction

202


203

Operating Information


Employees by Full Time Equivalent by Job Function Last Ten Years

(Unaudited)

204

2012 2011 2010 2009Professional Staff

Teachers 4,299.0 4,376.7 4,373.9 4,310.8Professional Support 869.8 885.9 904.5 908.0Campus Administration 191.5 193.9 194.1 189.0Central Administration 7.0 8.0 10.0 10.0Total Professional Staff 5,367.3 5,464.5 5,482.5 5,417.8

Educational Aides 683.3 698.5 715.3 742.5

Auxiliary Staff 2,366.6 2,394.6 2,355.5 2,346.9

Total Staff 8,417.2 8,557.6 8,553.3 8,507.2

Pupil to Teacher Ratio 15.7 15.2 14.9 14.7

Teachers by Population ServedRegular Education 3,052.8 3,099.0 3,002.0 2,753.4 Career and Technology 112.8 118.1 139.0 150.1 Bilingual/ESL 187.6 197.8 156.5 356.7 Compensatory Education 97.0 106.0 98.1 82.6 Gifted and Talented 68.1 72.7 67.8 72.6 Special Education 452.0 443.6 581.6 585.3 Other 328.7 339.6 328.8 310.2

Total 4,299.0 4,376.8 4,373.8 4,310.9

Source: Current year information is from Public Education Information Management System (PEIMS) Reports submitted to TEA. All other data obtained via Academic Excellence Indicator System (AEIS) Reports obtained from TEA’s Web site. Minor differences between this schedule and those on the internet are due to rounding.

Note: Professional Support includes librarians, counselors, school nurses, etc.

205

2008 2007 2006 2005 2004 2003

4,232.8 4,080.3 3,937.2 3,800.6 3,670.7 3,716.8900.6 860.4 822.2 759.2 745.1 742.2183.7 175.1 167.0 169.0 158.4 162.112.0 10.0 12.0 12.0 11.0 9.0

5,329.1 5,125.8 4,938.4 4,740.8 4,585.2 4,630.1

735.4 696.5 680.3 657.5 633.3 651.4

2,152.2 2,025.7 1,999.8 1,894.2 1,860.3 1,928.8

8,216.7 7,848.0 7,618.5 7,292.5 7,078.8 7,210.3

14.6 15.0 15.2 15.1 15.3 14.7

2,777.0 2,846.0 2,667.9 2,654.6 2,570.7 2,602.4 160.6 158.3 159.2 154.2 150.9 152.1 253.8 120.5 178.6 106.5 75.8 99.2 87.6 93.8 88.4 60.5 57.2 52.2 65.8 62.7 63.2 61.2 60.5 63.9

593.0 568.7 578.8 575.1 582.9 587.5 295.0 230.3 201.1 188.5 172.7 159.5

4,232.8 4,080.3 3,937.2 3,800.6 3,670.7 3,716.8


Teacher Salary Comparison Last Ten Years

(Unaudited)

206

State StateFiscal Minimum Maximum Minimum MaximumYear Salary Salary Salary Salary

2003 34,500$ 53,198$ 24,240$ 40,800$ 2004 36,500 54,444 24,240 40,8002005 38,653 58,401 24,240 40,8002006 38,653 57,619 24,820 41,7702007 42,153 60,803 27,320 44,2702008 44,000 62,103 27,320 44,2702009 45,500 63,503 27,320 44,2702010 46,440 57,990 27,320 44,2702011 46,440 57,990 27,320 44,2702012 46,000 57,990 27,320 44,270

Source: State Minimum Salary information obtained from TEA Web site. The District’s

salary information obtained from the District’s Department of Human Resources. Note: Salary information shown above is for teachers with a Bachelor’s degree. Teachers

with a Masters degree earn an additional $1,800. Teachers with a doctorate earn $1,500 above the master’s degree stipend.

The District’s maximum salary represents the maximum amount paid to teachers with

25 or more years of experience who begin employment with the District. Teachers who were employed with the District earning more than $57,990 annually as of 2009 were grandfathered at their existing rate of pay.


Operating Statistics Last Ten Years

(Unaudited)

207

GovernmentAverage Governmental Cost Wide Cost

Fiscal Daily Operating Per Operating PerYear Attendance Expenditures Pupil Expenses Pupil

2003 50,890 $ 385,801,783 $ 7,581 4.98 % $ 408,037,374 $ 8,018 0.0 %2004 52,287 387,377,023 7,409 -2.27 411,710,339 7,874 -1.82005 53,843 377,330,938 7,008 -5.41 402,086,830 7,468 -5.22006 55,866 437,344,076 7,828 11.71 470,252,278 8,418 12.72007 57,307 477,759,784 8,337 6.49 517,215,555 9,025 7.22008 58,290 519,701,383 8,916 6.94 565,984,039 9,710 7.62009 59,744 544,650,360 9,116 2.25 605,226,670 10,130 4.32010 61,480 563,537,155 9,166 0.55 615,549,458 10,012 -1.22011 62,698 564,209,521 8,999 -1.83 627,632,616 10,010 0.02012 63,642 545,613,510 8,573 -4.73 601,619,856 9,453 -5.6

ChangePercentPercent

Change

Source: CAFR Note: Operating expenditures and expenses exclude any debt service or capital transactions

as reflected in functions 71 through 81.


Fidelity Bonds Current Year

(Unaudited)

208

Amountof

Positions Covered Bond

Superintendent $ 1,000,000Associate Superintendents 1,000,000Executive Director of Management Information Services 1,000,000Senior Director of Budgets and Financial Analysis 1,000,000Executive Director of Procurement and eCommerce 1,000,000Senior Director of Risk Management 1,000,000Staff Accountants 1,000,000Applications Team Leader – Finance 1,000,000Investment Officer 1,000,000Applications Team Leader – Students 1,000,000Systems Analysts 1,000,000Computer Programmers 1,000,000Workers’ Compensation Claims Manager 1,000,000Payroll Manager 1,000,000Bookkeepers – Secondary Schools 1,000,000Bookkeepers – Elementary Schools 1,000,000Other Employees 1,000,000

The District purchases blanket crime coverage that covers all employees. The $1,000,000 limit is in the aggregate for all covered positions within the coverage period. Each occurrence has a $10,000 deductible.

209



School Building Information Last Nine Years

(Unaudited)

210

2012 2011 2010Elementary SchoolsNumber of Locations 44 44 42Square Footage 4,045,758 4,045,758 3,587,513Enrollment 31,734 31,647 31,357

Middle SchoolsNumber of Locations 13 13 13Square Footage 2,159,822 2,159,822 2,128,016Enrollment 15,377 15,050 14,837

High SchoolsNumber of Locations 8 8 8Square Footage 3,267,633 3,267,633 2,997,475Enrollment 20,328 19,907 19,304

Alternative SchoolsNumber of Locations 1 1 1Square Footage 167,546 167,546 168,696

Athletic FacilitiesSquare Footage 183,732 183,732 183,732

AdministrationSquare Footage 147,456 147,456 147,456

Support FacilitiesSquare Footage 354,046 354,046 354,046

District TotalsNumber of Locations 66 66 64School Square Footage 9,640,759 9,640,759 8,881,700Total Square Footage 10,325,993 10,325,993 9,566,934Enrollment 67,439 66,604 65,498

Source: The District’s Department of Budgets and Financial Analysis and AEIS Reports.

211

2009 2008 2007 2006 2005 2004

42 42 42 42 38 383,587,513 3,609,661 3,609,661 3,443,769 3,386,577 2,926,595

30,496 30,082 29,810 29,073 27,373 26,719

13 13 12 11 11 112,128,016 2,019,255 1,820,893 1,544,177 1,544,013 1,533,412

14,475 14,063 13,745 13,259 13,104 13,066

8 7 7 7 7 72,997,475 2,153,835 2,153,835 2,146,667 2,120,922 2,148,766

18,481 18,036 17,700 17,492 16,788 16,223

1 1 1 1 1 1168,696 166,426 166,426 134,079 111,555 46,258

147,213 134,725 134,725 129,549 129,549 124,549

147,456 147,456 147,456 147,456 147,456 147,456

320,014 308,263 308,263 349,791 370,665 371,967

64 63 62 61 57 578,881,700 7,949,177 7,750,815 7,268,692 7,163,067 6,655,0319,496,383 8,539,621 8,341,259 7,895,488 7,810,737 7,299,003

63,452 62,181 61,255 59,824 57,265 56,008

212

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NORTH EAST INDEPENDENT SCHOOL DISTRICT San Antonio, Texas

Schedule of Findings and Questioned Costs


217

SECTION I --- SUMMARY OF AUDITORS’ RESULTS

Financial Statements

Type of auditor’s report issued: Unqualified

Internal control over financial reporting: Material weakness(es) identified?

Yes

X No

Significant deficiency(ies) identified not considered

to be material weaknesses? Yes

X None Reported

Noncompliance material to financial statements noted?

Yes

X No

Federal Awards

Internal control over major programs: Material weakness(es) identified?

Yes

X No

Significant deficiency(ies) identified not considered

to be material weaknesses? Yes

X None Reported

Type of auditor’s report issued on compliance for

major programs Unqualified

Any audit findings disclosed that are required to be

reported in accordance with Circular A-133, Section. 510(a)?

Yes

X No

Identification of Major Programs

CFDA Numbers(s)

Name of Federal Program or Cluster

84.410 Education Jobs Fund 84.027, 84.173

84.391, 84.392A IDEA – Part B, Formula / IDEA – Part B, Preschool / ARRA - IDEA – Part B, Formula/, ARRA IDEA – Part B, Preschool

84.394 ARRA - State Fiscal Stabilization Fund (SFSF) Dollar threshold used to distinguish between Type A and Type

B programs: $1,714,763

Auditee qualified as low-risk auditee? X Yes No


Schedule of Findings and Questioned Costs


218

SECTION II --- FINANCIAL STATEMENT FINDINGS There were no financial statement findings required to be reported in accordance with Government Auditing Standards. SECTION III --- FEDERAL AWARD FINDINGS AND QUESTIONED COSTS None.


Summary Schedule of Prior Audit Findings


219

There were no prior audit findings reported.

EXHIBIT K-1 (Cont'd)NORTH EAST INDEPENDENT SCHOOL DISTRICT

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS


(1)

Federal

Entity Identifying

(4)

NumberCFDA

ExpendituresFederal

Number

(3)(2)

FEDERAL GRANTOR/

PASS-THROUGH GRANTOR/PROGRAM or CLUSTER TITLE

Pass-Through

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

Passed Through the George C.Marshall Flight Center

741NASA Student Launch Initiative 43.001 $NNM11AA16P

Total Passed Through the George C.Marshall Flight Center 741$

TOTAL NATIONAL AERONAUTICS AND SPACE ADMINISTRATION 741$

U. S. DEPARTMENT OF COMMERCE

Direct Programs

2,9992012 NIST Summer Institute for MS Science Teachers 11.609 $70NANB12H102

Total Direct Programs 2,999$

TOTAL U. S. DEPARTMENT OF COMMERCE 2,999$

U.S. DEPARTMENT OF DEFENSE

Direct Programs

562,227ROTC 12.000 $NA


TOTAL DEPARTMENT OF DEFENSE 562,227$

U.S. DEPARTMENT OF EDUCATION

Direct Programs

125,220Impact Aid - P.L. 81.874 84.041 $SO41B-2012-505718,256Impact Aid - P.L. 81.874 84.041 SO41B-2010-505713,750Impact Aid - P.L. 81.874 84.041 SO41B-2009-5057

Total CFDA Number 84.041 157,226

535,143Carol M White Physical Education Program 84.215F Q215F100225-11420,918Carol M White Physical Education Program 84.215F Q215F100225

Total CFDA Number 84.215F 956,061

Total Direct Programs 1,113,287$

Passed Through the Alamo Community College District

565Career & Technology - Tech Prep Education Program 84.243 $NA

Total Passed Through the Alamo Community College District 565$

Passed Through Education Service Center 10

130,765* McKinney-Vento Homeless Education 84.196A $00-01923,125* McKinney-Vento Homeless Education 84.196A 00-019

Total CFDA Number 84.196A 153,890

10,799* McKinney-Vento Homeless Education ARRA 84.387 A09-038

Total Passed Through Education Service Center 10 164,689$

Passed Through Education Service Center 13

184Texas Advanced Placement Spanish Languages 84.330C $0551030271213

Total Passed Through Education Service Center 13 184$

Passed Through State Department of Education

280,925Adult Education (ABE) - Federal 84.002A $124100017110406605Adult Education (ABE) - Federal 84.002A 114100017110364


220

EXHIBIT K-1 NORTH EAST INDEPENDENT SCHOOL DISTRICT



(1)

Federal

Entity Identifying

(4)

NumberCFDA

ExpendituresFederal

Number

(3)(2)

FEDERAL GRANTOR/


Pass-Through

10,166,415*ESEA, Title I, Part A - Improving Basic Programs 84.010A 12610101015910332,704*ESEA, Title I, Part A - Improving Basic Programs 84.010A 1161010101591045,806* ESEA Title I Part A School Improvement Program 84.010A 1261010401591012570,021ESEA Title ISchool Improvement Effective Strategies 84.010A 12610110015910125

Total CFDA Number 84.010A 10,614,946

176,344*ESEA, Title I, A - ARRA -Improving Basic Programs 84.389A 10551001015910

10,791,290Total Title I, Part A Cluster

10,569,852*IDEA - Part B, Formula 84.027A 126600010159106600223,203*IDEA - Part B, Formula 84.027A 11660001015910660055,435*SSA - IDEA - Part B, Discretionary 84.027A 1266000201591066732,110*SSA - IDEA - Part B, Discretionary 84.027A 116600020159106673

39,908*SSA - IDEA - Part B, Deaf 84.027A 12660001015910660121,311*SSA - IDEA - Part B, Deaf 84.027A 116600010159106601


244,103*IDEA - Part B, Preschool 84.173A 1266100101591066104,822*IDEA - Part B, Preschool 84.173A 116610010159106610

967*SSA - IDEA - Part B, Preschool Deaf 84.173A 1266100101591066112,255*SSA - IDEA - Part B, Preschool Deaf 84.173A 116610010159106611


440,411*IDEA, Part B, Formula - ARRA 84.391A 1055400101591056,013*IDEA, Part B, Preschool - ARRA 84.392A 10555001015910

11,660,390Total Special Education Cluster (IDEA)

650,664Career and Technical - Basic Grant 84.048A 104200060159102,771Summer School for Limited English Students 84.369A 69551002

5,704*Title II D Enhancing Ed Through Technology - ARRA 84.386A 10553001015910

429,330Title III, Part A - English Language Acquisition 84.365A 12671001015910131,287Title III, Part A - English Language Acquisition 84.365A 11671001015910


1,414,735ESEA, Title II, Part A, Teacher/Principal Training 84.367A 1269450101591075,918ESEA, Title II, Part A, Teacher/Principal Training 84.367A 11694501015910


1,371,669Title XIV, State Fiscal Stabilization Fund - ARRA 84.394A 1155700101591010,840,614Education Jobs Fund 84.410A 55011101

Total Passed Through State Department of Education 37,655,902$

TOTAL DEPARTMENT OF EDUCATION 38,934,627$

U.S. DEPARTMENT OF LABOR


30,697Workforce Investment Act - Dislocated Workers 17.278 $2012ATP00122,116Workforce Investment Act - Dislocated Workers 17.260 2011ATP001

Total Passed Through State Department of Education 52,813$

TOTAL DEPARTMENT OF LABOR 52,813$

U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES

Passed Through City of San Antonio

111,000Communities Putting Prevention to Work 93.724 $1U58DP002453-01

221

EXHIBIT K-1 NORTH EAST INDEPENDENT SCHOOL DISTRICT



(1)

Federal

Entity Identifying

(4)

NumberCFDA

ExpendituresFederal

Number

(3)(2)

FEDERAL GRANTOR/


Pass-Through

Total Passed Through City of San Antonio 111,000$

Passed Through Texas Dept of Human Services

143,745Medicaid Administrative Claiming Program - MAC 93.778 $NA

Total Passed Through Texas Dept of Human Services 143,745$


52,753Temporary Assistance for Needy Families (TANF) 93.558 $1236250171103819,091Temporary Assistance for Needy Families (TANF) 93.558 113625017110341

Total CFDA Number 93.558 61,844

Total Passed Through State Department of Education 61,844$

TOTAL DEPARTMENT OF HEALTH AND HUMAN SERVICES 316,589$

INSTITIUTE OF MUSEUM & LIBRARY SERVICES

Direct Programs

23,866National Leadership Grant (B) 45.312 $LG-46-11-0103-11


TOTAL INSTITIUTE OF MUSEUM & LIBRARY SERVICES 23,866$

U.S. DEPARTMENT OF AGRICULTURE

Passed Through the State Department of Agriculture

2,851,903*School Breakfast Program 10.553 $NA

12,930,128*National School Lunch Program - Cash Assistance 10.555 NA1,482,861*National School Lunch Prog. - Non-Cash Assistance 10.555 NA

Total CFDA Number 10.555 14,412,989

17,264,892Total Child Nutrition Cluster

Total Passed Through the State Department of Agriculture 17,264,892$

TOTAL DEPARTMENT OF AGRICULTURE 17,264,892$

TOTAL EXPENDITURES OF FEDERAL AWARDS 57,158,754$

*Clustered Programs

222


Notes to Schedule of Expenditure of Federal Awards

For the Year Ended June 30, 2012

223

1. For all federal programs, the District uses the fund types specified in the TEA’s Financial Accountability System Resource Guide.

General Fund – is used to account for, among other things, resources related to the United States Department of Defense ROTC program, and the United States Department of Education’s Impact Aid.

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

2. The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. The Governmental Fund types are accounted for using a current financial resources measurement focus. All federal grant funds were accounted for either in the General Fund or in the Special Revenue Funds, components of the Governmental Fund Types. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing resources) and decreases (i.e., expenditures and other financing uses) in net current assets.

The modified accrual basis of accounting is used for the Governmental Fund Types. This basis of accounting recognizes revenues in the accounting period in which they become susceptible to accrual (i.e., both measurable and available), and expenditures in the accounting period in which the fund liability is incurred, if measurable, except for certain compensated absences and claims and judgments, which are recognized when the obligations are expected to be liquidated with expendable available financial resources.

Federal grant funds are generally considered to be earned to the extent of expenditures made under the provisions of the grant and, accordingly, when such funds are received, they are recorded as deferred revenues until earned.

3. The period of availability for federal grant funds for the purpose of liquidation of outstanding

obligations made on or before the ending date of the federal project period extended 30 days beyond the federal project period ending date, in accordance with provisions in Section H Period of Availability of Federal Funds, Part 3, OMB Circular A-133 Compliance Supplement.


Notes to Schedule of Expenditure of Federal Awards

For the Year Ended June 30, 2012

224

4. The National School Lunch and Breakfast Programs and the USDA donated commodities are accounted for in the nonmajor governmental funds. The Impact Aid and ROTC programs are accounted for in the General Fund. Expenditures are not specifically attributable to these revenue sources and are shown on this schedule in an amount equal to revenue for balancing purposes only. The revenue for indirect costs is recognized in the General Fund.

5. The expenditures shown on the Schedule of Expenditures of Federal Awards (SEFA) does not

equal to total federal revenues shown on Exhibit C-3 by the amount of federal revenue recorded in various funds as shown below. These amounts are not subject to the Single Audit Act and are not required to be included in the SEFA.

Amount reported on the Schedule of

Expenditures of Federal Awards $ 57,158,754SHARS Revenue reported in the General Fund 5,115,559E-Rate Revenue reported in the General Fund 92,283Tax Credit Revenue reported in the Debt Service Fund 1,967,358Federal Program Revenue Reported on Exhibit C-3 64,333,954

E-Rate Revenue reported in the Internal Service Funds 1,184,724COBRA Premium Assistance Revenue

reported in the Internal Service Funds 1,068Federal Program Revenue Reported on Exhibit D-2 1,185,792

Total Federal Program Revenuefor Fiscal Year 2011-2012 $ 65,519,746

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