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Report No. 2018-097January 2018FLORIDA AGRICULTURAL ANDMECHANICAL UNIVERSITYFinancial AuditFor the Fiscal Year EndedJune 30, 2017Sherrill F. Norman, CPAAuditor General

Board of Trustees and PresidentDuring the 2016-17 fiscal year, Dr. Larry Robinson served as Interim President of the FloridaAgricultural and Mechanical University from 9-15-16, and Dr. Elmira Mangum served as Presidentbefore that date. The following individuals served as Members of the Board of Trustees:Kevin L. Lawson, ChairKimberly Ann Moore, Vice ChairJustin Bruno a from 12-1-16Dr. Matthew M. Carter IIThomas W. Dortch Jr.Dr. Bettye A. Grable bDavid Lawrence Jr.abMajor General Gary T. McCoy (Ret.)Harold MillsBelvin Perry Jr.Craig ReedJaylen Smith a through 11-30-16Nicole WashingtonRobert L. WoodyStudent Body President.Faculty Senate Chair.The Auditor General conducts audits of governmental entities to provide the Legislature, Florida’s citizens, public entitymanagement, and other stakeholders unbiased, timely, and relevant information for use in promoting governmentaccountability and stewardship and improving government operations.The team leader was Maria G. Loar, CPA, and the supervisor was Edward A. Waller, CPA.Please address inquiries regarding this report to Jaime Hoelscher, CPA, Audit Manager, by e-mail atjaimehoelscher@aud.state.fl.us or by telephone at (850) 412-2868.This report and other reports prepared by the Auditor General are available at:FLAuditor.govPrinted copies of our reports may be requested by contacting us at:State of Florida Auditor GeneralClaude Pepper Building, Suite G74 111 West Madison Street Tallahassee, FL 32399-1450 (850) 412-2722

FLORIDA AGRICULTURAL AND MECHANICAL UNIVERSITYTABLE OF CONTENTSPageNo.SUMMARY .iINDEPENDENT AUDITOR’S REPORT . 1Report on the Financial Statements . 1Other Reporting Required by Government Auditing Standards . 2MANAGEMENT’S DISCUSSION AND ANALYSIS . 4BASIC FINANCIAL STATEMENTSStatement of Net Position . 16Statement of Revenues, Expenses, and Changes in Net Position . 18Statement of Cash Flows . 20Notes to Financial Statements . 22OTHER REQUIRED SUPPLEMENTARY INFORMATIONSchedule of Funding Progress – Other Postemployment Benefits Plan . 48Schedule of the University’s Proportionate Share of the Net Pension Liability – FloridaRetirement System Pension Plan . 48Schedule of University Contributions – Florida Retirement System Pension Plan . 48Schedule of the University’s Proportionate Share of the Net Pension Liability – HealthInsurance Subsidy Pension Plan . 49Schedule of University Contributions – Health Insurance Subsidy Pension Plan . 49Notes to Required Supplementary Information . 50INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVERFINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERSBASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMEDIN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS . 51Internal Control Over Financial Reporting . 51Compliance and Other Matters . 52Purpose of this Report . 52

SUMMARYSUMMARY OF REPORT ON FINANCIAL STATEMENTSOur audit disclosed that the basic financial statements of Florida Agricultural and Mechanical University(a component unit of the State of Florida) were presented fairly, in all material respects, in accordancewith prescribed financial reporting standards.SUMMARY OF REPORT ON INTERNAL CONTROL AND COMPLIANCEOur audit did not identify any deficiencies in internal control over financial reporting that we consider tobe material weaknesses.The results of our tests disclosed no instances of noncompliance or other matters that are required to bereported under Government Auditing Standards issued by the Comptroller General of the United States.AUDIT OBJECTIVES AND SCOPEOur audit objectives were to determine whether Florida Agricultural and Mechanical University and itsofficers with administrative and stewardship responsibilities for University operations had: Presented the University’s basic financial statements in accordance with generally acceptedaccounting principles; Established and implemented internal control over financial reporting and compliance withrequirements that could have a direct and material effect on the financial statements; and Complied with the various provisions of laws, rules, regulations, contracts, and grant agreementsthat are material to the financial statements.The scope of this audit included an examination of the University’s basic financial statements as of andfor the fiscal year ended June 30, 2017. We obtained an understanding of the University’s environment,including its internal control, and assessed the risk of material misstatement necessary to plan the auditof the basic financial statements. We also examined various transactions to determine whether theywere executed, in both manner and substance, in accordance with governing provisions of laws, rules,regulations, contracts, and grant agreements.An examination of Federal awards administered by the University is included within the scope of ourStatewide audit of Federal awards administered by the State of Florida.AUDIT METHODOLOGYWe conducted our audit in accordance with auditing standards generally accepted in the United Statesof America and applicable standards contained in Government Auditing Standards, issued by theComptroller General of the United States.Report No. 2018-097January 2018Page i

AUDITOR GENERALS TATE OF F LORIDASherrill F. Norman, CPAAuditor GeneralClaude Denson Pepper Building, Suite G74111 West Madison StreetTallahassee, Florida 32399-1450Phone: (850) 412-2722Fax: (850) 488-6975The President of the Senate, the Speaker of theHouse of Representatives, and theLegislative Auditing CommitteeINDEPENDENT AUDITOR’S REPORTReport on the Financial StatementsWe have audited the accompanying financial statements of Florida Agricultural and MechanicalUniversity, a component unit of the State of Florida, and its aggregate discretely presented componentunits as of and for the fiscal year ended June 30, 2017, and the related notes to the financial statements,which collectively comprise the University’s basic financial statements as listed in the table of contents.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 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.Auditor’s ResponsibilityOur responsibility is to express opinions on these financial statements based on our audit. We did notaudit the financial statements of the aggregate discretely presented component units, which represent100 percent of the transactions and account balances of the aggregate discretely presented componentunits’ columns. Those statements were audited by other auditors whose reports have been furnished tous, and our opinion, insofar as it relates to the amounts included for the aggregate discretely presentedcomponent units, is based solely on the reports of the other auditors. We conducted our audit inaccordance with auditing standards generally accepted in the United States of America and the standardsapplicable to financial audits contained in Government Auditing Standards, issued by the ComptrollerGeneral of the United States. 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 the auditor’s judgment, including theReport No. 2018-097January 2018Page 1

assessment of the risks of material misstatement of the financial statements, whether due to fraud orerror. In making those risk assessments, the auditor considers internal control relevant to the entity’spreparation and fair presentation of the financial statements in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectivenessof the entity’s internal control. Accordingly, we express no such opinion. An audit also includesevaluating the appropriateness of accounting policies used and the reasonableness of significantaccounting estimates made by management, as well as evaluating the overall presentation of thefinancial statements.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinions.OpinionsIn our opinion, based on our audit and the reports of other auditors, the financial statements referred toabove present fairly, in all material respects, the respective financial position of Florida Agricultural andMechanical University and of its aggregate discretely presented component units as of June 30, 2017,and the respective changes in financial position and, where applicable, cash flows thereof for the fiscalyear then ended in accordance with accounting principles generally accepted in the United States ofAmerica.Other MattersRequired Supplementary InformationAccounting principles generally accepted in the United States of America require that MANAGEMENT’SDISCUSSION AND ANALYSIS, the Schedule of Funding Progress – Other PostemploymentBenefits Plan, Schedule of the University’s Proportionate Share of the Net Pension Liability –Florida Retirement System Pension Plan, Schedule of University Contributions – FloridaRetirement System Pension Plan, Schedule of the University’s Proportionate Share of the NetPension Liability – Health Insurance Subsidy Pension Plan, Schedule of University Contributions– Health Insurance Subsidy Pension Plan, and Notes to Required Supplementary Information, aslisted in the table of contents, be presented to supplement the basic financial statements. Suchinformation, although not a part of the basic financial statements, is required by the GovernmentalAccounting Standards Board who considers it to be an essential part of financial reporting for placing thebasic financial 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 audit of the basic financial statements. We do not express an opinionor provide any assurance on the information because the limited procedures do not provide us withsufficient evidence to express an opinion or provide any assurance.Other Reporting Required by Government Auditing StandardsIn accordance with Government Auditing Standards, we have also issued a report datedJanuary 30, 2018, on our consideration of the Florida Agricultural and Mechanical University’s internalPage 2Report No. 2018-097January 2018