North Carolina State University
SACS Compliance Certification
August 15, 2003

Core Requirements 2.11 (sound, stable financial base)
The institution has a sound financial base and demonstrated financial stability, and adequate physical resources to support the mission of the institution and the scope of its programs and services.  The institution provides the following financial statements: (a) an institutional audit (as distinct from a system wide or statewide audit) and management letter for the most recent fiscal year prepared by an independent certified public accountant or an appropriate auditing agency employing the appropriate audit guide; (b) an annual budget that is preceded by sound planning, is subject to sound fiscal procedures, and is approved by the governing board; and (c) a schedule of changes in unrestricted net assets, excluding plant and related debt (short and long-term debt attached to physical assets).

Compliance
North Carolina State University is in compliance with this requirement.

Explanation
NC State University has a sound financial base and adequate physical resources to support its mission, programs and services.  Statistical data provided in the university's audited financial reports for the ten years ending June 30, 2001 show a consistent pattern of growth in revenues and expenditures with ratios of total current revenues to total current expenditures of greater than 100%, indicating a very sound financial base. 

Although it has experienced some operating budget cuts over the last three years due to volatility in the economy, NC State University has avoided the crippling cuts associated with other state universities.  In contrast, the university is being provided with over $468,000,000 in new state bond funds to renovate its buildings and infrastructure.  Additional information about physical resources is included in Comprehensive Standards:  Resources #7 .

For further evidence of its financial strength, the university submits the following documents:

  • An institutional audit for FY02 performed by auditors of the state of North Carolina; the FY03 audit will become available in early 2004.
  • A management letter for FY02 from the state auditors that follows appropriate auditing and accounting standards; the FY03 management letter will become available in early 2004.
  • The FY02 schedule of changes in unrestricted net assets, excluding plant and plant related-related debt (short and long-term debt attached to physical assets).  The schedule for FY03 will become available by early September 2003. 

As a constituent institution of the University of North Carolina, NC State University follows the guidelines of the system's consolidated university budget process.  The budgetary process is preceded by university-wide planning, which involves the academic, student affairs, research, extension, and business functions of the university.  The budget is subject to sound fiscal procedures.  Finally, the budget is approved by the BOG. 

Preparation of the budget is preceded by the university's Compact Planning Process, which results in a written compact plan for each unit that delineates specific actions, outcomes, performance expectations, respective responsibilities, and funding requirements in the context of unit and university long-range goals and performance expectations.  It also describes resources necessary to achieve those outcomes and proposes workable sources for those resources, including internal reallocation, grants and contracts, fund-raising, and new appropriations.  If necessary, it describes alternative paths to completing an initiative dependent on future decisions about funding or policy decisions. As such, compact planning anchors the university's budgets and resource allocations by creating a set of investment opportunities, priorities, and preliminary budget requirements.  Additional details are provided in Core Requirements #5

The budget is managed using sound fiscal procedures developed by the Division of Finance and Business.  These procedures are also available via the University Budget Office and University Accounting Office websites.       

The budget is approved by the BOG and minutes are available on the Web.

References


NC State University Home --> Accreditation Home --> Compliance Reports --> Core 2.11

N.C. State University
Last Modified: Wednesday, 02-Sep-09 15:18:44