Annual Report BENEDICTINE UNIVERSITY 2004-2005
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annual report BENEDICTINE UNIVERSITY 2004-2005 tomorrow fo of r t y he it w rs e o v r i ld n p u o e p h u t l a e r t i a o n e . W Year ended May 31, 2005 It is our pleasure to provide you with the financial results from this past year. We are A Message harvesting the many fruits from our past investments and continue to look for the best opportunities to employ our capital to position Benedictine University as an from the institution that fully meets the needs and expectations of our target constituencies. Office of At the end of fiscal 2005, total assets on our Statement of Financial Position Business and increased 4.4 percent or $3.6 million from prior year. Collections and write-downs Finance on pledges resulted in the $4.2 million decrease in the non-current portion of our promises to give. Our investments, reported at an aggregate fair value of $20.4 million, grew $3.3 million primarily from pledge collections and this year’s net investment income. Accrued expenses and long-term debt increased from last year due to costs related to the new athletic facilities. The increase in our assets and a 7.1 percent increase in liabilities produced a 2.0 percent increase in net assets, which totaled $44.0 million at the end of the fiscal year. On our Statement of Activities, net assets for all classifications increased $0.9 million on total revenue and other support of $41.0 million. Tuition revenue has continued to grow due to rising enrollment in our existing programs and expansion into new markets, such as China and Springfield. Our investment strategy enabled us to recognize $1.9 million in net investment income, which follows a solid performance from the prior year. On the expense side, total expenses rose 6.0 percent, primarily from supplies and services that included costs for the Benedictine Hall demolition and the write-down of a large pledge to net realizable value. Interest expense is higher due to the rising interest rate environment and its effect on our 1999 Series Bonds. We are aware of the risk that this poses, however, and will continue to monitor its effects and consider the cost/benefit trade-offs. Looking ahead to next year, our new athletic facilities will be in full service and producing revenue from the various events. We should also feel the positive effects of insourcing our information technology department and see progress in our efforts to restructure our short- and long-term debt. With an eye on efficiencies, we look to wring more usefulness from our PeopleSoft investment. In and of itself, these investments are not enough. It requires the coordination of our activities, working and interacting with one another and making sound decisions to transform these assets and resources into greater value for our students, employees and the greater community. Charles Gregory Allan Gozum Executive Vice President Associate Vice President for Business and Finance Annual Report 2004-2005 1 Statements of Financial Position Assets As of May 31 2005 2004 Current assets: Cash and cash equivalents $ 3,347,003 $ 2,632,599 Receivables, net 3,775,991 3,441,448 Promises to give 353,392 360,147 Prepaid expenses and other assets 347,219 550,816 Total current assets 7,823,605 6,985,010 Loans receivable from students 2,166,170 1,934,450 Investments 20,392,541 17,105,497 Bond proceeds held in trust 42,985 42,323 Bond issue costs, net 210,589 234,498 Property and equipment, net 54,573,890 51,130,393 Promises to give 371,810 4,527,272 $ 85,581,590 $ 81,959,443 Liabilities and Net Assets Current liabilities: Note payable to bank $ 2,600,000 $ 3,493,503 Deferred revenue 698,504 301,814 Accounts payable and accrued expenses 7,017,883 5,998,611 Current portion of bonds payable 845,360 786,388 Current portion of capital lease payable 343,182 200,285 Deposits held in custody for others 460,205 668,973 Total current liabilities 11,965,134 11,449,574 Bond and note payable, less current portion 27,375,119 25,136,669 Refundable U.S. government grants for student loans 1,949,474 1,969,078 Capital lease payable 334,589 309,985 Total liabilities 41,624,316 38,865,306 Total net assets 43,957,274 43,094,137 $ 85,581,590 $ 81,959,443 2 Benedictine University Statements of Activities Years ended May 31 2005 Temporarily Permanently Unrestricted Restricted Restricted Total 2004 Revenue and other support: Tuition and fees $ 41,541,278 $ – $ – $ 41,541,278 $ 37,340,479 Less scholarships and grants (12,127,530) (98,722) – (12,226,252) (12,183,675) Net tuition and fees 29,413,748 (98,722) – 29,315,026 25,156,804 Private gifts and grants 1,602,005 338,713 134,878 2,075,596 2,909,698 Government grants and contracts 4,875,415 – – 4,875,415 5,592,545 Investment income (loss) 453,689 1,058,696 433,010 1,945,395 2,325,375 Other income 554,969 – – 554,969 656,333 Auxiliary enterprises 2,268,505 – – 2,268,505 3,116,719 Net assets released from 568,369 (346,000) (222,369) – – restrictions Total revenue and 39,736,700 952,687 345,519 41,034,906 39,757,474 and other support Expenses: Compensation: Salaries 16,470,425 – – 16,470,425 15,722,277 Benefits 4,121,561 – – 4,121,561 3,871,652 Total compensation 20,591,986 – – 20,591,986 19,593,929 Utilities 1,425,716 – – 1,425,716 1,367,884 Depreciation 2,683,936 – – 2,683,936 2,651,400 Interest 834,389 – – 834,389 572,010 Bad debts 200,000 – – 200,000 150,000 Supplies and services 14,435,742 – – 14,435,742 13,579,123 Total expenses 40,171,769 – – 40,171,769 37,914,346 Increase (decrease) (435,069) 952,687 345,519 863,137 1,843,128 in net assets Net assets, beginning of year 24,868,152 9,890,972 8,335,013 43,094,137 41,251,009 Net assets, end of year $ 24,433,083 $ 10,843,659 $ 8,680,532 $ 43,957,274 $ 43,094,137 Annual Report 2004-2005 3 benedictine university A Letter From Advancement Dear alumni and friends, positive change one graduate Thank you for your generous support. Contributions mean so much to our students and to Benedictine University. The donors listed on the pages in at a time our annual report have made so much possible for our students. Some donors made an education at Benedictine a reality by providing resources for scholarships, by means of gifts to the General Scholarship Fund or to specific scholarship funds. Others supported special events such as Educare Ball and the Golf Outing. Some have made contributions designated for specific curriculum needs and facility improvements. Others for special student educational programs or athletics. Many have made their gift unrestricted, enabling the University to choose how the funds are to be used. We allocate about three quarters of the unrestricted funds that we receive to scholarships. Unlike larger schools that have big endowment funds, we are far more dependent upon annual gifts. Planned gifts such as bequests through wills, designation of IRA assets, charitable gift annuities and remainder trusts have also had a major impact. Even though we are not a large school, we are a significant school. The more alumni I meet, the more impressed I become with Benedictine University. The quality of its graduates is rightfully a matter of pride for all of us. Benedictine University can point to prominent graduates in the fields of medicine, law, business management, social services, athletics, public service, mathematical and scientific research for medicine, industry, national health and security, and education. The quality of education at Benedictine University has a major effect not only on the lives of its alumni, but also on everyday life in America and beyond. Who would guess that a school of our size would make such a difference? But it does. You may wish to help make a difference as well, either for the first time or again. Please use the envelope enclosed with this issue of Voices to make a gift. * Photo quotes taken from an Your donation will not only enable students to attend Benedictine interview with Benedictine President William Carroll in the University, but will help them make a positive impact on the future. Fall 2005 Voices magazine. Bradley F. Carlson Every effort has been made to Chief Development Officer list names correctly. If you find a problem with the way your name appears, please contact us at (630) 829-6072. 4 Benedictine University diversity is an example of Students gather at ‘The Rock’ by Lake St. Benedict, 2005. Our Giving Societies The Pillars of $250,000 – $499,999 Pillars of Benedictine University Benedictine University $250,000 – $499,999 The Founder’s Society $100,000 – $249,999 The Estates of Mr. & Mrs. Harold Moser St. Procopius Abbey The Benedictine Hall Society $50,000 – $99,999 Founder’s Society $100,000 – 249,999 The Abbey Society $25,000 – $49,999 Barnes & Noble College Bookstores Inc. Pepsi-Cola General Bottlers Inc. The Prior’s Society $10,000 – $24,999 Benedictine Hall Society The Provost’s Society $5,000 – $9,999 $50,000 – $99,999 Arthur J. Schmitt Foundation The Dean’s Society $2,500 – $4,999 Calamos Investments John P. Calamos, Sr.