Colleges and Universities

Question 1

What type of standards to not-for-profit universities follow? What type of standards to public universities follow?

Answer 1

• FASB (not-for-profit)

- GASB (public university)

Question 2

What are the deductions to get to net tuition revenues?

Answer 2

All tuition is first recorded at gross tuition then deducted.

• Scholarship allowances: Awards to students that cover tuition such as pell grants, that are reduction in charges and do not involve actual payment of resources. Uncollectible accounts is also deducted.
• Scholarship expenses- Involve actual expenditure of resources
• Tuition waivers (to employees) are expenses

Question 3

What are examples of auxiliary revenues and expenses, and where are they reported?

Answer 3

• Residence hall revenue
• Food service revenue
• Book store revenue
• Parking Revenue

Auxiliary revenues and expenses are aggregated as a single line item in the operating section as a non-operating revenue. They are not reported in the top line of the income statement

Question 4

What financial statements for a not-for-profit university and a public university?

Answer 4

Not-For-Profit:

• Balance Sheet
• Statement of activities
• Statement of cash flows

Public:

• Statement of net position
• Statement of revenues, expenses, and changes in net position
• Statement of cash flows

Question 5

What is the “Equity” section like for a not-for-profit college or university?

Answer 5

Net assets with donor restrictions

Net assets without donor restrictions