Transcription
2017 Financial ReportThe University of Alabama at Birmingham
UAB is an equal educationopportunity institution, and an equalemployment opportunity employer.This report is published by the UABVice President for Financial Affairs and Administration.Obtain additional copies by writing:Vice President for Financial Affairs and AdministrationThe University of Alabama at BirminghamBirmingham, Alabama 35294
Contents2 Introduction to UABOverview/Vision/MissionHighlightsStudent ProfileStudent HeadcountFaculty ProfileStaff ProfileState AppropriationsSponsored Grants and ContractsHospital8 Financial StatementsManagement’s Responsibility forFinancial ReportingReport of Independent AuditorsManagement’s Discussion and Analysis(Unaudited)Statements of Net PositionStatements of Revenues, Expenses,and Changes in Net PositionStatements of Cash FlowsNotes to Financial Statements57 Required Supplementary Information(Unaudited)60 UAB Administration61 The Board of Trustees ofThe University of Alabama1
Introductionto UABVisionTo be an internationally renowned researchuniversity — a first choice for education andhealth care.MissionTo be a research university and academichealth center that discovers, teaches andapplies knowledge for the intellectual,cultural, social and economic benefit ofBirmingham, the state and beyond.The University of Alabama at Birmingham(UAB) became an autonomous campuswithin The University of Alabama Systemin 1969 and, in the four decades since,has grown into a world-renowned researchuniversity and medical center, occupyingmore than 100 city blocks in Alabama’slargest metropolitan area. UAB is thestate’s largest single-site employer withmore than 23,000 employees.In fall 2017 UAB achieved recordhigh overall enrollment for the secondconsecutive year (20,902), including afreshman class that is the university’slargest (2,299) and most academicallyprepared ever with an average ACT of 25.1and average GPA of 3.62.UAB’s research enterprise continues to beglobally renowned. In the 2017 U.S. News& World Report “Best Global Universities,”UAB vaulted 36 spots to number 162 inthe world and is the top-ranked Alabamauniversity by more than 250 spots.With over 528 million in total researchexpenditures, UAB ranks 18th in federalresearch funding and 10th in National2Institutes of Health funding among publicuniversities.UAB is home to the 3rd largest publichospital in the U.S. and the state’s onlylevel 1 adult trauma center. In the U.S.News & World Report “Best Hospitals,”UAB has 10 specialties ranked in thenational top 50 and its ongoing live donorkidney chain is the longest ever conductedanywhere on the globe.The information included in thisintroduction (pages 2-8) does not includedata related to component units of UABthat are discussed in the notes to thefinancial statements.2017 OverviewAs a globally respected academic medicalcenter, UAB excels at translating researchinto leading-edge patient care. UAB’sComprehensive Cancer Center, among thefirst eight such centers to be designatedby the National Cancer Institute (NCI) inthe early 1970s, remains the only one inAlabama and a five-state region.Students are engaged in a robustresearch enterprise, some beginning intheir freshman year. UAB offers studentsnovel academic programs and unrivaledresearch opportunities, such as the newB.S. in Immunology, the only undergradprogram of its kind in the Southeast.Over the past year, UAB students won arecord 31 nationally or globally competitivescholarships, including a record fiveFulbright Scholarships and three GoldwaterScholarships.Graduate programs also continue togarner national recognition. In the 2017U.S. News & World Report “Best GraduateSchools,” UAB has 10 programs in thetop 25 nationally, including a master’s inhealth administration that ranks 2nd in thenation.UAB is among only 62 universities—andthe only one in Alabama—classified by theCarnegie Foundation for both “HighestResearch Activity” and “CommunityEngagement.”UAB has an economic impact on Alabamathat exceeds 7.15 billion annually andis key in growing a tech- and knowledgebased economy for Alabama. In 2017, theUAB Harbert Institute for Innovation &Entrepreneurship has generated 4.66million in revenue, 6 start-up companies,and 52 licenses and 45 patents. InnovationDepot, in which UAB is a founding partner,is the largest business incubator in theSoutheast, with 102 start-up companiesand a 1.42 billion economic impact overthe past five years.
Highlights100%80%professional6%graduate31%out of country 3%over 3513%other18%out of Student Profile60%other AL counties42%Total 19,535As of Fall %0%female61%under 2236%LevelStatusAgeJefferson County37%RaceSexSourceStudent HeadcountEnrollment for the fall semester of the 2016-2017 school year is outlined in the following table.FALL 2016FIRST PROFESSIONAL/UNDERGRADUATEGRADUATEADVANCED PROFESSIONAL*TOTALSCHOOL OF ARTS AND SCIENCES5,846579206,445SCHOOL OF BUSINESS2,441507-2,948SCHOOL OF EDUCATION1,00773011,738SCHOOL OF L10,2812,29223812,811SCHOOL OF MEDICINE--1,7991,799SCHOOL OF DENTISTRY231351375SCHOOL OF OPTOMETRY--220220SCHOOL OF NURSING8581,71012,569SCHOOL OF HEALTH PROFESSIONS9021,13592,046SCHOOL OF PUBLIC HEALTH3053758688JOINT HEALTH SCIENCES-31514329SUBTOTAL, ACADEMIC HEALTH CENTER2,0883,5362,4028,026TOTAL ENROLLMENT12,3695,8282,64020,837ACADEMIC HEALTH CENTER:*Includes 1,108 first professionals and 1,302 advanced professionals.3
Faculty ProfileTotal 2,543As of Fall 58%20%0%RaceSexStatusTenureStaff ProfileTotal 18,702As of Fall l50%Divisionwhite58%RaceSexStatus
StateAppropriationsState appropriations for UAB are madeby the Alabama State Legislaturebased upon a process which involvesrequests from the Board of Trustees ofThe University of Alabama, and budgetrecommendations by the AlabamaCommission on Higher Education and theGovernor. State funds are appropriatedannually from the Educational Trust Fund(ETF) to UAB. For the fiscal year endedSeptember 30, 2017, UAB received directfunding from the ETF in the amount of 272,166,253.Appropriations ReceivedFiscal years ended September 30(Dollars in millions)UniversityHospital 300 250 32.2 32.7 32.9 33.0 33.4 226.2 231.4 232.4 234.3 238.8 200 150 100 50 0201320142015201620175
Sponsored Grantsand ContractsDuring fiscal year 2017, UAB received 470.3million in sponsored grants and contracts revenues(including 86.7 million of indirect cost recovery).Various federal agencies provided the majorityof support for these projects, with the NationalInstitutes of Health (NIH) being the primary sponsor.Nonfederal funding sources include state agencies,local governmental agencies, and a wide variety ofprivate sponsors.Revenues from grants and contracts (includingindirect cost recovery) increased from 444.2million during fiscal year 2016 to 470.3 millionduring fiscal year 2017, an increase of 5.9% for theperiod.Grants andContracts RevenuesFiscal years ended September 30(Dollars in millions) 500 450 470.3 400 350 399.5 426.7 444.2 398.4 300 250 200620132014201520162017
HospitalOperationsThe University of Alabama Hospital (the “Hospital”) is a 1,157-bedquaternary and tertiary care medical facility and part of the UABHealth System. The Hospital includes North Pavilion, Women andInfant Center, Jefferson Tower, Hillman Building, Spain WallaceBuilding, Quarterback Tower, North Wing, Spain RehabilitationCenter, West Pavilion, Russell Ambulatory Center, Medical Education Building, Highlands and the Center for Psychiatric Medicine.Other clinical facilities in the UAB Academic Health Center includeSmolian Psychiatric Clinic, Engel Psychiatric Day Treatment Center,Lurleen B. Wallace Tumor Institute, and the 1917 Clinic. The Hospital also has strong ties with other governmental and private nonprofit institutions located within and adjacent to the UAB campus,including Veterans Affairs Medical Center and Children’s Hospital.Other healthcare facilities in the UAB Health System include TheKirklin Clinic, the Callahan Eye Hospital, Medical West and BaptistHealth (located in Montgomery, Alabama).Inpatient discharges increased 1.9% and adjusted patientdischarges increased 2.9%. Operating room cases increased1.9% over fiscal year 2016. Also emergency room visitsincreased 2% during fiscal year 2017. The Hospital had anincrease in net position of 110 million in fiscal year 2017.Hospital Awards and AccoladesSelected Hospital operating statistics are outlined below:Beds in servicePatient dischargesAdjusted patient dischargesPatient daysAdjusted patient daysOperating room casesEmergency department visitsPatient origin:Jefferson CountyOther Alabama countiesOut of 048.0%46.3%5.7%46.8%47.5%5.7%Ten UAB Medicine specialties are among the nation’s top 50 inthe 16 categories evaluated for nearly 5,000 U.S. hospitals thisyear by U.S. News and World Report. Four of these specialtieswere in the top 20. The rankings appear in the 2017-18 annual“America’s Best Hospitals” special edition issue. UAB alsoreceived five “America’s Best Hospital’s honors for 2017 fromWomen’s Choice Award, achieving recognition as a hospital ofchoice among women. UAB was recognized in five categories:Breast Centers, Bariatric Surgery, Cancer Care, Heart Care, andObstetrics. UAB Hospital has been named by Becker’s HospitalReview among the 2017 “100 Great Hospitals in America,” acompilation of some of the most prominent, forward-thinkingand focused healthcare facilities in the nation. UAB is the onlyAlabama hospital in 2017 to make the list.7
THE UNIVERSITY OFALABAMA AT BIRMINGHAMOffice of the Vice President for Financial Affairs and AdministrationManagement’s Responsibility for Financial ReportingThe accompanying financial statements of the University of Alabama at Birmingham (UAB) forthe years ended September 30, 2017 and 2016 were prepared by UAB’s management inconformity with accounting principles generally accepted in the United States of America.The management of UAB is responsible for the integrity and objectivity of these financialstatements, which are presented on the accrual basis of accounting and, accordingly, includesome amounts based upon judgment. Other financial information in the annual report isconsistent with that in the financial statements. The system of internal accounting controls isdesigned to help ensure that the financial reports and the books of account properly reflect thetransactions of the institution, in accordance with established policies and procedures asimplemented by qualified personnel.The Board of Trustees of The University of Alabama, through its Audit, Risk and ComplianceCommittee, monitors the financial and accounting operations of the institution, including thereview and discussion of periodic financial statements and the evaluation and adoption ofbudgets. The Board of Trustees of The University of Alabama, through its Audit, Risk andCompliance Committee, monitors the basis of engagement and reporting of independent auditors.G. Allen Bolton, Jr.Vice President for Financial Affairsand AdministrationStephanie MullinsUAB Chief Financial Officer1030 Administration Building701 20th Street South205.934.5493Fax 205.934.36108Mailing Address:AB 10301720 2ND AVE SBIRMINGHAM AL 35294-0110
Report of Independent AuditorsTo the Board of Trustees of The University of Alabama:We have audited the accompanying financial statements of the business-type activities and the discretelypresented component unit of The University of Alabama at Birmingham (“UAB”), a campus of TheUniversity of Alabama System, which is a component unit of the State of Alabama, which comprise thestatements of net position as of September 30, 2017 and 2016, and the related statements of revenues,expenses, and changes in net position and of cash flows (where applicable) for the years then ended, andthe related notes to the financial statements, which collectively comprise UAB’s basic financialstatements.Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation and fair presentation of the financial statements inaccordance with accounting principles generally accepted in the United States of America; this includesthe design, 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 orerror.Auditors’ ResponsibilityOur responsibility is to express opinions on the financial statements based on our audits. We did notaudit the financial statements of Southern Research Institute (“SRI”), UAB’s discretely presentedcomponent unit, as of December 30, 2016 and January 1, 2016 and for the years then ended. Thosestatements were audited by other auditors whose report thereon has been furnished to us, and ouropinion, insofar as it relates to the amounts included for SRI, is based solely on the report of the otherauditors. We conducted our audits in accordance with auditing standards generally accepted in theUnited States of America. Those standards require that we plan and perform the audit to obtainreasonable 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 inthe financial statements. The procedures selected depend on our judgment, including the assessment ofthe risks of material misstatement of the financial statements, whether due to fraud or error. In makingthose risk assessments, we consider internal control relevant to UAB’s preparation and fair presentationof 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 UAB’s internal control.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 thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis for our auditopinions.OpinionsIn our opinion, based on our audits and the report of other auditors, the financial statements referred toabove present fairly, in all material respects, the respective financial position of the business-typeactivities and the discretely presented component unit of The University of Alabama at Birmingham as ofSeptember 30, 2017 and 2016 and the respective changes in financial position and, where applicable,PricewaterhouseCoopers LLP, 569 Brookwood Village, Suite 851, Birmingham, AL 35209T: (205) 414-4000, F: (205) 414-4001, www.pwc.com/us9
cash flows thereof for the years then ended in accordance with accounting principles generally acceptedin the United States of America.Emphasis of MatterAs discussed in Note 1, the financial statements of UAB are intended to present the financial position, thechanges in financial position and the cash flows of only that portion of the business-type activities of thefinancial reporting entity of The University of Alabama System that is attributable to the transactions ofUAB. They do not purport to, and do not, present fairly the financial position of The University ofAlabama System as of September 30, 2017 and 2016, its changes in financial position, or its cash flowsfor the years then ended in accordance with accounting principles generally accepted in the United Statesof America. Our opinion is not modified with respect to this matter.Other MattersRequired Supplementary InformationThe accompanying management’s discussion and analysis on pages 11 through 17 and the accompanyingsupplementary information on pages 58 and 59 are required by accounting principles generally acceptedin the United States of America to supplement the basic financial statements. Such information,although not a part of the basic financial statements, is required by the Governmental AccountingStandards Board who considers it to be an essential part of financial reporting for placing the basicfinancial statements in an appropriate operational, economic, or historical context. We have appliedcertain limited procedures to the required supplementary information in accordance with auditingstandards generally accepted in the United States of America, which consisted of inquiries ofmanagement about the methods of preparing the information and comparing the information forconsistency with management's responses to our inquiries, the basic financial statements, and otherknowledge we obtained during our audits of the basic financial statements. We do not express anopinion or provide any assurance on the information because the limited procedures do not provide uswith sufficient evidence to express an opinion or provide any assurance.Other InformationOur audits were conducted for the purpose of forming opinions on the financial statements thatcollectively comprise UAB’s basic financial statements. The introductory information on pages 2 through7 and the management’s report on page 8 are presented for purposes of additional analysis and are not arequired part of the basic financial statements. Such information has not been subjected to the auditingprocedures applied in the audits of the basic financial statements, and accordingly, we do not express anopinion or provide any assurance on it.January 22, 201810
Management’s Discussion and Analysis (Unaudited)The objective of management’s discussion and analysisis to help readers of UAB’s financial statements betterunderstand the financial position and operatingactivities for the fiscal years ended September 30,2017 and 2016. UAB’s financial statements presentthe financial position, changes in financial position,and the cash flows of the University, the University ofAlabama Hospital (the Hospital), and UAB’s blendedcomponent units. Condensed financial informationof UAB’s reportable segments is presented at Note16. GASB Statement No. 14, The Financial ReportingEntity (GASB Statement No. 14), as amended by GASBStatement No. 61, The Financial Reporting Entity:Omnibus-an amendment of GASB Statements No.14 and No. 34 (GASB Statement No. 61), requiresgovernmental entities to include in their financialstatements as component units, organizations that arelegally separate entities for which the governmentalentity, as a primary organization, is financiallyaccountable. Southern Research Institute (SRI) is adiscretely presented component unit of UAB. Blendedcomponent units include Hospital Management LLC(LLC), Triton Health Systems, L.L.C. (Triton), AlabamaCare Plan (ACP), UAB Athletics Foundation (UABAF)and UAB Research Foundation (UABRF). The followingdiscussion and analysis provides an overview of UAB’sfinancial activities. This discussion should be read inconjunction with the financial statements and notes tothe financial statements.Financial OverviewUAB’s financial position remained strong, as assetstotaled 4.82, 4.41, and 4.11 billion at September30, 2017, 2016, and 2015. Increases of 416 million or9% from 2016 to 2017 were primarily due to increasesin investments and capital assets. Increases of 300million or 7% from 2015 to 2016 were primarily dueto increases in investment assets and the continuedgrowth in accounts receivable.Total liabilities increased 201 million or 8% fromSeptember 30, 2016 to September 30, 2017. Theincrease results primarily from the issuance of bondsduring fiscal year
center, UAB excels at translating research into leading-edge patient care. UAB’s Comprehensive Cancer Center, among the first eight such centers to be designated by the National Cancer Institute (NCI) in
