TC Audit Shows Sound Financial Principles & Increased Stablity

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At its joint November-December meeting today, the Texarkana College Board of Trustees learned that enrollment numbers for Spring 2016 are up from last year, with trends showing more area residents are seeking a higher education credential. Texarkana College will continue spring registration through January 14, 2016.

Vice President of Instruction Donna McDaniel said more than 280 students will graduate in Texarkana’s fall commencement ceremony on Thursday, Dec. 17 at 7 p.m. at First Baptist Church, Moores Lane, Texarkana, Texas.

“This is a record number of graduates for fall,” McDaniel said. “We continue to see student completion rates increase due to our ‘Commit to Complete Initiative,’ started in 2011 by Mary Ellen Young, faculty advisor for TC’s Phi Theta Kappa International Honor’s Society.”

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Texarkana College will award 160 certificates and 123 associate academic degrees at the ceremony.
During the meeting, the Board approved the College’s audited financial statements for the year ending August 31, 2015. The motion came after hearing a report by auditor Tim Holt, Audit Manager of Thomas & Thomas Certified Public Accounting firm. The firm fully disclosed the financial position of Texarkana College showing a $1.4 million net increase for the fiscal year.

“Texarkana College realized a positive change between 2014 and 2015 in unrestricted net assets,” Holt said. “The gain resulted predominately from cost savings as a result of reduced expenditures and the implementation of a new enterprise resource planning software in August 2014. This increase to the bottom line is evidence that drastic cost-savings measures taken by the board and administration this year resulted in a positive net gain. Texarkana College continues the focused objective of returning to the historically sound financial principles and stability for which the institution was known.”

Holt also said the College implemented provisions mandated by the Teacher Retirement System (TRS) to comply with Government Accounting Standards Board’s (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions, which came into effect June 15, 2014.

GASB issued these changes in June 2012 to provide better transparency regarding the reporting of liabilities on public pensions and participating employers and to mandate the separation of pension plan accounting from decisions on how to fund them. The adoption of this Statement by the College resulted in a reduction of $3,618,165 in the beginning net positions of the College’s unrestricted net assets.

“Texarkana College participates in TRS along with most public schools and community college districts across the state,” President James Henry Russell said. “The new mandate is not unique to TC, but has fiscal impact nevertheless. Because TC is a participant in the state teacher retirement system, we were informed in 2012 that we would have to comply with the new measures beginning June 2014 by reporting a net pension liability and expense in our financial statements equal to our proportionate share of the collective net pension liability and expense. This does not mean, however, that TC must pay out this amount to TRS, but rather show as restricted funds within our financial statement as a possible fiduciary responsibility.”

The Texarkana College Board has received numerous updates about this change over the last two years. Texarkana College, along with other colleges across Texas and all independent school districts in Texas, expect that this bill will never have to be paid to the State and will continue to exist only as a paper entry. Governmental entities with pension systems all across the nation are making this same entry to show the contribution needed to fully fund pensions if a team of actuaries determines TRS is unsound in its current funding structure.

The Texas Teacher Retirement System remains one of the strongest pension systems in the nation. The audited financial statements report TC’s portion of shared net pension liability to be 0.012 % of the collective net pension liability across the state.

Russell also noted that while things are definitely better at TC, financial struggles continue when it comes to addressing deferred maintenance needs and preserving affordable tuition rates for students.

“We are doing everything within our power to keep tuition and fees as low as possible while maintaining high quality instruction for our students in a safe and contemporary environment,” Russell said.

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