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WRIGHT STATE UNIVERSITYGREENE COUNTYJULY 1, 2015 TO JUNE 30, 2016
Board of TrusteesWright State University3640 Col. Glenn HighwayDayton, Ohio 45435We have reviewed the Independent Auditors Report of the Wright State University, GreeneCounty, prepared by Crowe Horwath LLP, for the audit period July 1, 2015 through June 30,2016. Based upon this review, we have accepted these reports in lieu of the audit required bySection 117.11, Revised Code. The Auditor of State did not audit the accompanying financialstatements and, accordingly, we are unable to express, and do not express an opinion on them.Our review was made in reference to the applicable sections of legislative criteria, as reflected bythe Ohio Constitution, and the Revised Code, policies, procedures and guidelines of the Auditorof State, regulations and grant requirements. The Wright State University is responsible forcompliance with these laws and regulations.Dave YostAuditor of StateJanuary 9, 201788 East Broad Street, Fifth Floor, Columbus, Ohio 43215‐3506Phone: 614‐466‐4514 or 800‐282‐0370Fax: 614‐466‐4490www.ohioauditor.gov
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WRIGHT STATE UNIVERSITYANNUAL REPORT AND SINGLE AUDIT REPORTS FOR FEDERAL AWARDSTABLE OF CONTENTSJUNE 30, 2016Page (s)Part I - Financial InformationIndependent Auditors Report3-5Management's Discussion and Analysis7-21Financial Statements:Financial StatementsNotes to Financial Statements23-3435-79Required Supplementary Information:Schedule of the Wright State University Proportionate ShareOPERS Net Pension Liability and ContributionsSchedule of the Wright State University Proportionate ShareSTRS Net Pension Liability and Contributions8283Part II - OMB 2 CFR 200 Supplemental Financial ReportsSchedule of Expenditures of Federal AwardsNotes to the Schedule of Expenditures of Federal Awards85-9697Independent Auditors Report on Internal Control over Financial Reporting and onCompliance and Other Matters Based on an Audit of Financial StatementsPerformed in Accordance with Government Auditing Standards99-100Independent Auditors Report on Compliance for Each Major Federal Program;Report on Internal Control over Compliance101-102Schedule of Findings and Questioned Costs1031
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Crowe Horwath LLPIndependent Member Crowe Horwath InternationalINDEPENDENT AUDITOR'S REPORTTo the Board of Trusteesof Wright State UniversityDayton, OhioReport on the Financial StatementsWe have audited the accompanying financial statements of the business-type activities and aggregatediscretely presented component units of Wright State University (the University), a component unit of theState of Ohio, as of and for the years ended June 30, 2016 and 2015, and the related notes to the financialstatements, which collectively comprise the University’s basic financial statements as listed in the table ofcontents.Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation and fair presentation of these financial statements inaccordance with accounting principles generally accepted in the United States of America; this includes thedesign, implementation, and maintenance of internal control relevant to the preparation and fairpresentation of financial statements that are free from material misstatement, whether due to fraud or error.Auditor’s ResponsibilityOur responsibility is to express opinions on these financial statements based on our audits. We conductedour audits in accordance with auditing standards generally accepted in the United States of America andthe standards applicable to financial audits contained in Government Auditing Standards, issued by theComptroller General of the United States. Those standards require that we plan and perform the audit toobtain reasonable assurance about whether the financial statements are free from material misstatement.An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in thefinancial statements. The procedures selected depend on the auditor’s judgment, including the assessmentof the risks of material misstatement of the financial statements, whether due to fraud or error. In makingthose risk assessments, the auditor considers internal control relevant to the entity’s preparation and fairpresentation of the financial statements in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internalcontrol. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of significant accounting estimates made bymanagement, as well as evaluating the overall presentation of the financial statements.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for ouraudit opinions.3
OpinionsIn our opinion, the financial statements referred to above present fairly, in all material respects, therespective financial position of the business-type activities and the aggregate discretely presentedcomponent units of the University, as of June 30, 2016 and 2015, and the respective changes in its financialposition and, where applicable, cash flows thereof for the years then ended in accordance with accountingprinciples generally accepted in the United States of America.Emphasis of matterAs disclosed in Note 1, during 2016 the University elected to change its reporting to include Wright StateApplied Research Corporation as a discretely presented component unit and also changed the format ofpresentation for the aggregate discretely presented component units in the financial statements. Bothchanges were made retroactively to July 1, 2015. Our opinion is not modified with respect to this matter.Other MattersRequired Supplementary InformationAccounting principles generally accepted in the United States of America require that the Management’sDiscussion and Analysis, the Schedule of the Wright State University Proportionate Share of the OPERSNet Pension Liability and Contributions, and the Schedule of the Wright State University ProportionateShare of the STRS Net Pension Liability and Contributions as listed in the table of contents be presentedto supplement the basic financial statements. Such information, although not a part of the basic financialstatements, is required by Governmental Accounting Standards Board who considers it to be an essentialpart 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 informationin accordance with auditing standards generally accepted in the United States of America, which consistedof inquiries of management about the methods of preparing the information and comparing the informationfor consistency with management’s responses to our inquiries, the basic financial statements, and otherknowledge we obtained during our audit of the basic financial statements. We do not express an opinion orprovide any assurance on the information because the limited procedures do not provide us with sufficientevidence to express an opinion or provide any assurance.Supplementary InformationOur audit was conducted for the purpose of forming opinions on the financial statements that collectivelycomprise the University’s basic financial statements. The accompanying schedule of expenditures offederal awards as required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, UniformAdministrative Requirements, Cost Principles, and Audit Requirements for Federal Awards is presented forpurposes of additional analysis and is not a required part of the basic financial statements.The schedule of expenditures of federal awards is the responsibility of management and was derived fromand relates directly to the underlying accounting and other records used to prepare the financial statements.Such information has been subjected to the auditing procedures applied in the audit of the financialstatements and certain additional procedures, including comparing and reconciling such information directlyto the underlying accounting and other records used to prepare the basic financial statements or to thebasic financial statements themselves, and other additional procedures in accordance with auditingstandards generally accepted in the United States of America. In our opinion, the schedule of expendituresof federal awards is fairly stated, in all material respects, in relation to the basic financial statements as awhole.4
Other Reporting Required by Government Auditing StandardsIn accordance with Government Auditing Standards, we have also issued our report dated the same dateof this report on our consideration of the University’s internal control over financial reporting and on ourtests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements andother matters. The purpose of that report is to describe the scope of our testing of internal control overfinancial reporting and compliance and the results of that testing, and not to provide an opinion on internalcontrol over financial reporting or on compliance. That report is an integral part of an audit performed inaccordance with Government Auditing Standards in considering the University’s internal control overfinancial reporting and compliance.Crowe Horwath LLPColumbus, OhioOctober 14, 20165
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Wright State UniversityManagement’s Discussion and AnalysisFiscal Year Ended June 30, 2016Wright State University’s Management Discussion and Analysis (MD&A) presents an overview of itsfinancial condition and assists the reader in focusing on significant financial issues for the year ended June30, 2016, with selected comparative information for the years ended June 30, 2015 and 2014. Thediscussion has been prepared by management and should be read in conjunction with the accompanyingfinancial statements and footnotes. The financial statements, footnotes, and this discussion are theresponsibility of management.Financial and Other University Highlights The 2015 – 2016 was a year of intense preparation for the university’s review by the Higher LearningCommission (HLC) for reaffirmation of accreditation. Wright State University submitted its assuranceargument to the HLC in November 2015. The document was the collaborative effort of numerousfaculty, staff, and student representatives and was cited as “exemplary” by the HLC review team. TheUniversity also received commendation for its strategic planning and self-study processes. The reviewculminated in a campus visit by a peer review team in March 2016. The HLC final report for affirmationof reaccreditation was received in July 2016. The reaccreditation is effective for 10 years beginningwith the 2016-2017 academic year. Wright State has been continuously accredited since 1968. Wright State University made significant progress on its capital plan, bringing several major projects tonear or full completion. October 2015 brought the opening ceremony for the 17 million, 67,000 squarefoot Student Success Center building which co-locates academic support services, study centers, andstate-of-the art teaching and learning environments. The Raj Soin College of Business opened itsstudent-managed Rey-Rey Café this year. Tom Hanks was on campus in May 2016 to dedicate theTom Hanks Center for Motion Pictures. The second phase of renovations and the new addition to theCreative Arts Center were opened to ArtsGala patrons in April 2016 with full completion expected forfall 2016. Wright State continues efforts to increase student academic success. In addition to the new StudentSuccess Center, the University actively engages with area community colleges such as Sinclair andClark State to develop programs for a path to a bachelor’s degree for all students. These efforts alsoincluded a 30% increase in College Credit Plus enrollments in fall 2015. This program providesstudents in grades 7-12 who qualify to take college level courses for which they earn high school andcollege credit upon successful completion of the course. Along these lines, the University was awardeda 0.7 million grant from the State of Ohio (the State) to partner with Clark State Community Collegeto credential local high school teachers to teach College Credit Plus courses. Wright State continues to be named in various national ratings for its achievement in academic andstudent success. Several Wright State online graduate programs were ranked among the best in 2016by US News and World Report. The College of Education and Human Services’ online Master ofEducation program was ranked 17th of all responding schools, landing in the top 10% of programs. TheIndustrial and Human Factors Engineering program offered through the College of Engineering andComputer Science landed at 41st out of responding programs. Raj Soin College of Business’ Masterof Information Systems and Master in Logistics and Supply Chain Management was ranked 59th of theparticipating programs. The American Association for Access, Equity and Diversity recognized the University with its EdwardM. Kennedy Community Service Award for the university’s effort to make campus accessible andinclusive to all. The Association called Wright State a national leader of services for students withdisabilities and one of the top five disability-friendly universities in the United States.7
In April 2016, Wright State University’s Model United Nations team continued its remarkable streak atthe National Model United Nations Conference, receiving recognition for the 37th year in a row. Theteam returned from the national conference in New York City with a Distinguished Delegation award.Competing against approximately 150 universities from around the world, Wright State was one ofapproximately 30 colleges to receive this level of recognition. In addition, the team won fiveOutstanding Position Paper awards. While undergraduate tuition remained the same in 2016 as in 2015, non-resident fees as well as tuitionfor graduate level and professional schools increased 2.3% for 2016. This compares to a 2.2% tuitionincrease for all degree levels at both campuses and for professional schools in 2015. The Universitycontinues to pursue revenue enhancing efforts and expense optimization initiatives in order to mitigatethe necessary increases in tuition costs. Wright State remains the fourth lowest in-state undergraduatetuition rate among Ohio’s thirteen four-year public institutions. Total state appropriations increased 3.6 million from 2015 to 2016 in addition to a 1.1 million increasefrom 2014 to 2015. The 2016 and 2015 increases were primarily a result of a larger pool of state dollarsawarded to higher education as well as the university’s continued success in driving course and degreecompletions in alignment with the university’s mission and the priorities of the State’s performancefunding model. Total net position decreased 37.4 million in 2016 largely as a result of increased salaries and benefitsas well as student financial aid and scholarships aimed at increasing enrollment, retention, studentsuccess and programming. Net position was also impacted by negative variances in budgeted to actualrevenues from state appropriations, tuition revenue and investment income. Net investment in capitalincreased 12.1 million as a result of the progress in campus capital projects. Unrestricted net positionfell by 48.8 million primarily as a result of the use of unrestricted resources to fund some of the capitalprojects as well as the revenue shortfalls and expense overages mentioned previously. Net positiondecreased 268.1 million in 2015. The implementation of GASB 68 was responsible for a restatementwhich reduced unrestricted net position by 246.1 million. Further reductions were caused by theuniversity’s use of reserves to fund capital projects and investments in targeted enrollment strategies. Fall 2015 headcount was 18,059 as opposed to 17,779 in fall 2014. Embedded in this 1.6% increasewas an increase in international students and graduate level students. Increased credit hours andgraduate and professional level fees led to a 2.2 million (1.2%) increase in gross student tuition. Theincrease in gross tuition was offset by a 4.4 million increase in scholarships, resulting in an overall 2.2 million decrease in net tuition and fees revenue. Fall 2014 headcount represented an increase of1% from fall 2013 headcount. This combined with the slight tuition and fees rate increase resulted in a 6.4 million (4.4%) increase in net student tuition and fees revenue in fiscal year 2015. The Wright State University Foundation continued its 150 million fundraising campaign knownas Rise. Shine. The Campaign for Wright State University. The campaign, which was launched inOctober 2014, has been vastly successful reaching large numbers of alumni, friends, corporations andfoundations. As of June 30, 2016, the campaign has generated 159 million. The University is honoredto have Tom Hanks, Hollywood icon, and Amanda Wright Lane, great grandniece of universitynamesakes Wilbur and Orville Wright, co-chair the campaign. During 2016, the University implemented GASB Statement No. 72, Fair Value Measurement andApplication issued in February 2015. This Statement addresses accounting and financial reportingissues related to fair value measurements. This statement provides guidance for determining a fairvalue measurement for financial reporting purposes. It also provides guidance for applying fair valueto certain investments and disclosures related to all fair value measurements. Please refer to thediscussion of New Accounting Standards Adopted in Note 1 of the financial statements for furtherdetails.8
Using the Annual ReportThis annual report includes three financial statements: the Statement of Net Position, the Statement ofRevenues, Expenses and Changes in Net Position, and the Statement of Cash Flows. These financialstatements are prepared in accordance with GASB Statement No. 35, Basic Financial Statements-andManagement’s Discussion and Analysis-For Public Colleges and Universities as amended by GASBStatement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources,and Net Position; GASB Statement No. 68, Accounting and Financial Reporting for Pensions – AnAmendment of GASB Statement No. 27; and GASB Statement No. 71, Pension Transition for ContributionsMade Subsequent to the Measurement Date - An Amendment of GASB Statement No. 68. These financialstatements focus on the financial condition of the University, the results of operations, and cash flows ofthe University as a whole.Under the provisions of GASB Statement No. 61, The Financial Reporting Entity: Omnibus, the Wright StateUniversity Foundation (the Foundation) and the Wright State Applied Research Corporation (WSARC) haveboth been determined to be component units of the University. Accordingly, the Foundation and WSARCare discretely presented in the university’s financial statements. Management’s Discussion and Analysisand information included in this discussion and analysis relate only to Wright State University and not tothe Wright State University Foundation or the Wright State Applied Research Corporation unless specificallynoted.The three financial statements should help the reader of the annual report understand the university’soverall financial condition and how it has changed as a result of the current year’s financial activities. Thesefinancial statements present similar information to that disclosed in private sector (i.e. corporate) financialstatements. The financial statements will also assist the reader in evaluating the ability of the University tomeet its fin
Wright State University 3640 Col. Glenn Highway Dayton, Ohio 45435 We have reviewed the Independent Auditors Report of the Wright State University, Greene County, prepared by Crowe Horwath LLP, for the audit period July 1, 2015 through June 30, 2016. Based upon this review, we hav
