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FRASIERDEAN
HOWARD C PAs
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity's
preparation and fair presentation of the financial statements in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit
also includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall presentation
of the financial statements.
Frasier, Dean & Howard, PLLC 3310 West End Avenue, Suite 550 Nashville, Tennessee 37203-1089 615.383 .6592 fox 615.383.7094 www.fdhcpa.com
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and each major fund of LEAD Public
Schools as of June 30, 2015, and the respective changes in financial position for the year then ended
in accordance with accounting principles generally accepted in the United States of America.
Emphasis of Matter
As discussed in Note 11 to the financial statements, in fiscal year 2015, LEAD Public Schools
adopted Government Accounting Standards Board Statement No. 68, Accounting and Financial
Reporting for Pensions - an Amendment of GASB Statement No. 27. Our opinion is not modified
with respect to this matter.
Other Matters
ReqUired Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management's discussion and analysis on pages 4 - 9 and the schedule of proportionate share of the
net pension asset, the schedule of contributions - Teacher Legacy Pension Plan of TCRS, and the
schedule of contribution - Teacher Retirement Plan of TCRS on pages 34 - 36 be presented to
supplement the basic financial statements. Such information, although not a part of the basic
financial statements, is required by the Governmental Accounting Standards Board, who considers it
to be an essential part of financial reporting for placing the basic financial statements in an
appropriate operational, economic, or historical context. We have applied certain limited procedures
to the required supplementary information in accordance with auditing standards generally accepted
in the United States of America, which consisted of inquiries of management about the methods of
preparing the information and comparing the information for consistency with management's
responses to our inquiries, the basic financial statements, and other knowledge we obtained during
our audit of the basic financial statements. We do not express an opinion or provide any assurance
on the information because the limited procedures do not provide us with sufficient evidence to
express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opmJOns on the financial statements that
collectively comprise LEAD Public Schools' basic financial statements. The accompanying
Schedule of Expenditures of Federal Awards and State Financial Assistance is presented for purposes
of additional analysis as required by the State of Tennessee Comptroller of the Treasury, Audit
Manual for Local Governmental Units and Recipients of Grant Funds and is not a required part of
the basic financial statements.
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The Schedule of Expenditures of Federal Awards and State Financial Assistance is the responsibility
of management and was derived from and relates directly to the underlying accounting and other
records used to prepare the basic financial statements. Such information has been subjected to the
auditing procedures applied in the audit of the basic financial statements and certain additional
procedures, including comparing and reconciling such information directly to the underlying
accounting and other records used to prepare the basic financial statements or to the basic financial
statements themselves, and other additional procedures in accordance with auditing standards
genera lly accepted in the United States of America. In our opinion, the Schedul e of Expenditures of
Federal Awards and State Financial Assistance is fairly stated in a ll material respects in relation to
the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December
21,201 5, on our consideration of LEAD Public Schoo ls' internal contro l over financial reporting and
our tests of its compliance with certain provisions of laws, regulations, contracts, and grant
agreements and other matters. The purpose of that report is to describe the scope of our testing of
internal control over financia l reporting and compliance and the results of that testing, and not to
provide an opinion on internal control over financial reporting or on compliance. That report is an
integral part of an audit performed in accordance with Government Auditing Standards In
considering LEAD Public Schools' internal control over financial reporting and compliance.
-3-
The assets and deferred outflows of resources of the Organization exceeded its liabilities and
deferred inflows of resources by $684,794.
Total revenues of $16,759,695 were comprised of Federal Pass-through Funds 7%, District
Funds 92%, and Other 1% in 2015
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Total assets
-6-
266,890
1,014,698
16,916
2014
(As Restated)
$ 1,223,944
542,754
670,066
1,298,504
2,436,764
780,031
47,912
39,349
1,393,741
Net position:
Net investment in capital assets
Restricted
1,014,698
(329,904)
684,794
1,742,176
542,754
160,397
$
703,151
On a consolidated basis, inclusive of all entities, total equity is approximately $5.3 million at June
30, 2015. The current organizational structure has allowed the Organization to operate its schools in
a very efficient and effective manner.
Changes in Net Position
The Organizations total net position decreased $18,357 during the 2015 fiscal year. The decrease in
the Organizations net position indicates that the Organization had more outgoing expenses than
incoming revenues during the year. The Organization budgeted a decrease of $494,637 in 2015.
Total revenues generated from government grants, governmental funds, foundation grants and other
sources were $16,561,028 during the 2015 fiscal year.
A schedule of the Organizations revenue and expenses is as follows for the year ended June 30:
Revenues:
District funding
Federal subrecipient grants
Other grants
Other
Expenses:
Salaries, wages and benefits
Occupancy cost
Network service fee
Instructional
Transportation
Depreciation
Professional and service fees
2015
2014
$ 15,369,762
1,227,171
91,194
(127,099)
16,561,028
$ 11,794,725
1,493,990
287,793
38,755
13,615,263
10,367,106
1,476,521
1,364,488
1,128,905
1,070,319
312,728
284,006
-7-
8,774,556
776,325
1,021,651
1,133,585
718,911
261,845
66,700
205,803
171,578
132,982
64,949
16,579,385
(18,357)
157,682
78,932
212,804
26,854
13,229,845
$
385,418
-8-
-9-
Total assets
266,890
1,014,698
16,916
1,298,504
780,031
780,031
1,393,741
1,393,741
Net position:
Net investment in capital assets
Restricted
1,014,698
(329,904)
684,794
Expenses:
Salaries, wages and benefits
Instructional
Network service fee
Occupancy cost
Transportation
Depreciation
Staff development
Office expense
Other expenses
Professional and service fees
Outreach
Total
Student
Instruction
and
Services
$ 10,367,106
1,128,905
1,364,488
1,476,521
1,070,319
312,728
132,982
205,803
171,578
284,006
64,949
$ 10,367,106
1,128,905
37,489
1,476,521
1,070,319
284,977
132,982
205,803
171,578
106,267
55,207
16,579,385
15,037,154
1,548,572
1,548,572
15,030,813
$ 13,488,582
Total expenses
Program revenues:
Program specific operating
grants and contributions
Net program expenses
General revenues:
District funding
Other grants
Other income
Loss on disposal of capital
assets
15,048,361
91,194
71,568
(198,667)
15,012,456
(18,357)
1,727,348
(1,024,197)
$
684,794
See accompanying notes.
-11-
Administration Fundraising
$
1,326,999
27,751
177,739
9,742
1,542,231
1,542,231
LEAD
Academy
Cameron
College Prep
LEAD Prep
Southeast
Brick Church
College Prep
Neely's Bend
College Prep
Total
Governmental
Funds
Assets
Accounts receivable, LEAD
Public Schools, Inc.
Total assets
2,476,933
471,757
2,948,690
2,476,933
471,757
2,948,690
68,885
2,681,800
Total liabilities
1,808,231
Fund balances:
Unassigned
Restricted
Total fund balances
Total liabilities and
fund balances
1,808,231
804,684
804,684
68,885
2,681,800
(2,681,800)
2,948,690
(1,808,231)
-
2,476,933
(804,684)
-
471,757
(68,885)
-
(1,808,231)
2,476,933
(804,684)
471,757
(68,885)
2,476,933
471,757
266,890
2,948,690
266,890
1,014,698
16,916
780,031
(1,393,741)
$
684,794
Total revenues
Expenditures:
Current:
Student instruction
and services
Administration
Fundraising
Capital outlays
Total expenditures
Change in fund balances
Fund balances - beginning
of year
Fund balances - end of year
228,809
131,547
Cameron
College Prep
$
292,560
105,237
LEAD Prep
Southeast
$
101,699
27,217
Brick Church
College Prep
Neely's Bend
College Prep
Total
Governmental
Funds
477,497
57,400
126,606
-
5,037,122
28,083
23,777
5,348,474
28,989
29,900
2,158,715
9,965
13,839
2,504,050
24,157
4,052
5,449,338
5,805,160
2,311,435
3,067,156
126,606
16,759,695
5,532,570
470,913
103,223
4,910,389
547,237
18,217
2,140,854
219,979
827,654
2,459,571
249,601
1,700
136,195
26,751
32,545
15,179,579
1,514,481
983,339
6,106,706
5,475,843
3,188,487
2,710,872
195,491
17,677,399
(657,368)
329,317
(1,150,863)
2,147,616
(1,808,231)
2,476,933
1,227,171
321,401
(877,052)
356,284
(68,885)
72,368
115,473
(804,684)
471,757
(68,885)
15,048,361
91,194
71,568
(917,704)
1,184,594
$
266,890
(917,704)
983,339
(312,728)
(198,667)
1,041,113
780,031
(1,393,741)
(18,357)
-16-
-18-
-19-
480,794 $
112,356
77,857
37,038
274,468
325,312
1,307,825
(765,071)
74,432 $
22,511
886,396
983,339
(312,728)
$
(268,152)
(18,800)
(286,952)
88,285
555,226
134,867
77,857
37,038
892,712
306,512
2,004,212
(989,514)
542,754 $
670,611 $
(198,667) $
1,014,698
Accumulated depreciation
284,977
27,751
312,728
-23-
$
-24-
605,644
458,523
453,244
462,309
471,555
480,986
2,932,261
-26-
41,067
Deferred
Inflows of
Resources
$
1,393,741
279,487
407,826
Total
728,380
not applicable
$
1,393,741
(295,009)
(295,009)
(295,009)
(295,009)
53,426
53,423
In the table above, positive amounts will increase pension expense, while negative amounts
will decrease pension expense.
Actuarial assumptions. The total pension liability in the June 30, 2014 actuarial valuation was
determined using the following actuarial assumptions, applied to all periods included in the
measurement:
Inflation
3.0 percent
Salary increases
2.5 percent
-27-
Asset Class
U.S. equity
Developed market international equity
Emerging market international equity
Private equity and strategic lending
U.S. fixed income
Real estate
Short-term securities
Target
Allocation
33%
17%
5%
8%
29%
7%
1%
100%
The long-term expected rate of return on pension plan investments was established by the TCRS
Board of Trustees as 7.5 percent based on a blending of the three factors described above.
-28-
-29-
-30-
-32-
-33-
0.353752%
16,916
4,105,490
0.41%
100.08%
* The amounts presented were determined as of June 30 of the prior fiscal year.
This is a 10-year schedule. However, the information in this schedule is not required to be
presented retroactively. Years will be added to this schedule in future fiscal years until 10 years of
information is available.
-34-
407,826
2015
407,826
4,512,224
9.04%
2014
362,826
362,826
$
$
4,105,490
8.88%
This is a 10-year schedule. However, the information in this schedule is not required to be
presented retroactively. Years will be added to this schedule in future fiscal years until 10 years of
information is available.
-35-
51,651
51,651
1,290,126
4.00%
This is a 10-year schedule. However, the information in this schedule is not required to be
presented retroactively. Years will be added to this schedule in future fiscal years until 10 years of
information is available.
-36-
OTHER INFORMATION
CFDA#
Contract
Balance
Number June 30, 2014
Receipts
Expenditures
Balance
June 30, 2015
84.010
N/A
84.010
N/A
84.395
N/A
84.377
N/A
84.367A
N/A
84.388A
N/A
91,405
238,622
693,669
172,300
126,606
126,606
319,176
350,937
29,125
29,125
150,000
58,595
786,825
$ 1,227,171
115,456
-
83,074
89,226
147,217
604,443
89,226
521,369
521,369
678,968
FRASIERDEAN
HOWARDC PAs
Frasier, Dean & Howard, PLLC 3310 West End Avenue, Suite 550 Nashville, Tennessee 37203-1089 615.383.6592 fax 615.383.7094 \oVWW.fdhcpa.com
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