Northern Public Radio WNIJ / WNIU-FM Public
Northern Public Radio
WNIJ / WNIU-FM
Public Telecommunication Entities Operated by Northern Illinois University
Audited Financial Statements
June 30, 2017 and 2016
Northern Public Radio WNIJ / WNIU-FM
Public Telecommunication Entities Operated by Northern Illinois University
Table of Contents
Page
Independent Auditors’ Report 3-4
Management’s Discussion and Analysis 5-11
Financial Statements:
Statement of Net Assets 12
Statement of Revenues, Expenses and Changes in Net Assets 13
Statement of Cash Flows 14
Notes to Financial Statements 15-18
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3
4
Management’s Discussion and Analysis Fiscal Year 2017
Following are financial statements prepared by Northern Public Radio for fiscal year 2017. Included are the Statement of Net Assets, Statement of Revenues, Expenses and Changes in Net Assets, and Statement of Cash Flows. All statements are shown in a comparative format.
The Statement of Net Assets provides a financial picture of Northern Public Radio as of June 30, 2017. The Statement of Revenues, Expenses and Changes in Net Assets provide information regarding the sources of revenues and categorize expenses functionally, as determined by the Corporation for Public Broadcasting, over the fiscal year ending June 30, 2017. Total Net Assets on this statement ties back to Total Net Assets on the Statement of Net Assets. The Statement of Cash Flows provides information on the activities Northern Public Radio derives revenue from or incurs expenses toward. The year-end cash balance on this statement ties back to cash on the Statement of Net Assets.
Fiscal year 2017 was a year of constant review and prioritization for the stations. Overall revenue was down 5% while expenses were down almost 10% from the previous year. Grant revenue declined under the FY17 Illinois budget stalemate while the largest growth came in from Gifts. A positive outcome from an overall challenging year.
Revenue
FY16 FY17
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0 NIU ‐ GR Grants Gifts Auxiliary In‐Kind Enterprises
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REVENUE BY SOURCE 2017
NIU ‐ GR 19%
In‐Kind 37%
Grants 7%
Auxiliary Enterprises 0%
Gifts 37%
REVENUE BY SOURCE 2016
NIU ‐ GR 17%
In‐Kind Grants 43% 9%
Gifts Auxiliary Enterprises 31% 0%
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REVENUE TRENDS – 5 YEAR HISTORY
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0% 2013 2014 2015 2016 2017
NIU ‐ GR Grants Gifts Auxiliary Enterprises In‐Kind
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0 FY13 FY14 FY15 FY16 FY17
NIU‐GR Grants Gifts Auxiliary Enterprises
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Overall expenses decreased, down 7% from the previous fiscal year. In most years, swings in the functional expense categories are mainly attributable to transitions in staffing. FY17 was no exception. The one expense category to end the year with an increase in expenses is Program Information & Promotion. Additional expense in personnel along with an increase to expenses associated with more targeted station engagement and awareness campaigns were the main source of this increase.
The remaining expense categories all had a reduction in expense for the year and are best illustrated in the bar graph shown below. The trend line shows the relative consistency within the individual categories over the most recent five year period.
Expense
FY16 FY17
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0 Programming & Broadcasting Program Management & Fund Raising & Underwriting & Production Information & General Membership Grant Promotion Development Solicitation
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EXPENSES BY FUNCTION 2017 (Excluding Depreciation)
Underwriting & Grant Solicitation 9%
Fund Raising & Membership Development 13%
Programming & Production 46%
Management & General 16%
Program Information & Promotion 7% Broadcasting 9%
EXPENSES BY FUNCTION 2016 (Excluding Depreciation)
Underwriting & Grant Solicitation 11%
Fund Raising & Membership Development 14% Programming & Production 45%
Management & General 15%
Program Information & Promotion Broadcasting 5% 10% 9
EXPENSE TRENDS – 5 YEAR HISTORY
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0% 2013 2014 2015 2016 2017
Programming & Production Broadcasting Program Information & Promotion Management & General Fund Raising & Membership Development Underwriting & Grant Solicitation
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0 2013 2014 2015 2016 2017
Programming & Production Broadcasting Program Information & Promotion Management & General Fund Raising & Membership Development Underwriting & Grant Solicitation
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The role and relevance of services provided by Northern Public Radio will continue to grow and respond to community needs. The expansion of local news, arts, cultural and information programming will require careful stewardship of fundraising initiatives while managing associated expenses. Fiscal year 2017 provided a stable foothold for pursuing these priorities.
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WNIU AND WNIJ PUBLIC TELECOMMUNICATION ENTITIES OPERATED BY NORTHERN ILLINOIS UNIVERSITY STATEMENT OF NET ASSETS June 30,
2017 2016 ASSETS Current Assets Cash and Cash Equivalents $ 1,139,095 $ 804,928 Accounts Receivable 0 0 Grants Receivable 0 0 Prepaid Expenses 50,114 59,959 Total Current Assets 1,189,209 864,887
Noncurrent Assets Capital Assets, Net of Accumulated Depreciation 701,700 769,377 Total Noncurrent Assets 701,700 769,377
TOTAL ASSETS 1,890,909 1,634,264
LIABILITIES Current Liabilities Accounts Payable 12,759 23,178 Deferred Revenue 31,782 8,123 Total Current Liabilities 44,541 31,301
TOTAL LIABILITIES 44,541 31,301
NET ASSETS Invested in Capital Assets, Net of Related Debt 701,700 769,377 Restricted 50,000 0 Unrestricted 1,094,668 833,586
TOTAL NET ASSETS 1,846,368 1,602,963
TOTAL LIABILITIES AND NET ASSETS $ 1,890,909 $ 1,634,264
See accompanying notes to financial statements
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WNIU and WNIJ PUBLIC TELECOMMUNICATIONS ENTITIES OPERATED BY NORTHERN ILLINOIS UNIVERSITY STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS For the Year Ended June 30,
2017 2016 REVENUES Operating Revenue Grants from Corporation for Public Broadcasting $ 199,697 $ 288,285 Grants - State 23,183 23,183 Grants - Private 0 0 Grants - Federal 0 0 Other Sources 2,325 5,050
Total Operating Revenues 225,205 316,518
EXPENSES Operating Expenses Program Services Programming and Production 1,398,623 1,506,755 Broadcasting 266,997 351,644 Program Information and Promotion 214,621 165,179 Support Services Management and General 471,787 510,967 Fund Raising and Membership Development 390,040 458,904 Underwriting and Grant Solicitation 284,195 376,704 Depreciation and Amortization 43,836 31,406
Total Operating Expenses 3,070,099 3,401,559
Net Operating Revenue/(Expense) (2,844,894) (3,085,041)
NONOPERATING REVENUES (EXPENSES) General Revenue from Northern Illinois University 1,504,676 1,481,504 Facilities and Support Services from Northern Illinois University 337,973 574,435 Gifts 1,239,730 1,103,014 Contributed Services 5,101 20,495 Interest Income 0 0 Other Sources 819 2,528
Net Nonoperating Revenues 3,088,299 3,181,976
INCREASE (DECREASE) IN NET ASSETS 243,405 96,935
NET ASSETS, BEGINNING OF YEAR 1,602,963 1,506,028
NET ASSETS, END OF YEAR $ 1,846,368 $ 1,602,963
See accompanying notes to financial statements
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WNIU AND WNIJ PUBLIC TELECOMMUNICATION ENTITIES OPERATED BY NORTHERN ILLINOIS UNIVERSITY STATEMENT OF CASH FLOWS For the Year Ended June 30,
2017 2016
Cash flows from operating activities: Change in net assets $243,405 $96,935 Adjustments to reconcile change in net assets to net cash used by operating activities: Equipment non-taggable 0 0 Depreciation expense 43,836 31,406 (Increase) decrease in assets: Accounts receivable 0 0 Grants receivable 0 9,520 Prepaid expenses 9,845 (54,835) Increase (decrease) in liabilities: Accounts payable (10,419) (47,571) Deferred revenue 23,659 (63,729)
Net cash provided by operating activities 310,326 (28,274)
Cash flows from investing activities: Purchase of property and equipment 23,841 13,470 Capital improvements 0 0
Net cash used by investing activities 23,841 13,470
Cash flows from financing activities: Payments on long-term debt 0 0
Net cash used by financing activities 0 0
Net increase in cash and cash equivalents 334,167 (14,804)
Cash and cash equivalents at beginning of year 804,928 819,732
Cash and cash equivalents at end of year $1,139,095 $804,928
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Northern Public Radio (includes WNIU and WNIJ)
PUBLIC TELECOMMUNICATION ENTITIES OPERATED BY NORTHERN ILLINOIS UNIVERSITY
Note 1: Summary of Significant Accounting Policies The significant accounting policies followed by Northern Public Radio are presented below to assist the reader in evaluating the financial statements and accompanying notes.
Financial Reporting Entity Organization WNIU and WNIJ are public radio stations owned and operated by Northern Illinois University. Broadcast facilities are located in DeKalb, Illinois, with a satellite branch in Rockford, Illinois. The transmitting tower is located in Lindenwood, Illinois. WNIU was established in 1954. WNIJ was added in 1991. Repeater stations WNIQ (Sterling), WNIW (LaSalle), and WNIE (Freeport) began broadcasting during the fiscal year ended 6/30/99.
Basis of Accounting Effective for the year ending June 30, 2003, Northern Pubic Radio adopted GASB No. 35, Basic Financial Statements – and Management’s Discussion and Analysis – for Public Colleges and Universities, which established new reporting requirements for public colleges and universities.
Fund Accounting The accounts of Northern Public Radio are maintained in accordance with the principles of fund accounting. Separate accounts are maintained for each fund. However, in the accompanying financial statements, funds that have similar characteristics have been combined into fund groups.
Restricted Funds These funds are restricted by grantors or other outside agencies as to the specific purpose for which they may be used. Revenues are reported only to the extent of expenses incurred for current operating purposes. Expenses are recorded on the accrual basis. Sources of revenue include federal, state and private grants and contracts.
Revenue Recognition All revenues are reported according to the Financial Reporting Guidelines outlined in the Help section of ISIS on the Corporation for Public Broadcastings web-site. In accordance with FASB No. 116, revenue for unrestricted grants has been recognized when promised, not necessarily when funds are received.
Depreciation of Buildings and Equipment Property and equipment are recorded at cost, or in the case of donated items, the fair market value on the date of receipt. In accordance with generally accepted accounting principles Northern Public Radio implemented GASB No. 35 for FY2003. Depreciation is calculated on equipment with a value of $5,000 or greater. Depreciation on buildings is calculated over 25 years. Depreciation on capital improvements is calculated over 20 years.
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In-Kind Contributions Donated facilities from Northern Illinois University consist of office and studio space, together with related occupancy costs. These costs are included in the revenue and expense in accordance with an occupancy formula as directed by the Corporation for Public Broadcasting. Administrative support from the University consists of allocated educational and general operational expenditures and certain other expenses incurred by the University on behalf of Northern Public Radio.
Donated commodities and professional services are recorded as revenue and expense at the documented fair market value of the goods and services received, as allowed by the Corporation for Public Broadcasting.
Income Taxes Northern Public Radio is exempt from federal income tax, except on activities unrelated to its exempt purpose, as described in Code Section 501(c)(3) of the Internal Revenue Code. There was no required provision for income taxes for the year ended June 30, 2017.
Note 2: Property and EquipmentPRIVATE Property and equipment are recorded at cost, or in the case of donated items, fair market value on the date of receipt.
A summary of property and equipment follows:
2017
Land, Building $1,078,806
Capital Improvements 434,009
Transmission, Antenna, Tower 1,059,902
Studio, Broadcast Equipment 516,422
Furniture & Fixtures 187,265
Total $3,276,404
Accumulated Depreciation (2,574,704)
Net Total $701,700 ======
Equipment items valued at less than $500 (other than high-theft items) are no longer maintained in Northern Illinois University’s inventory listings. All information shown relates to items with a value in excess of $500 or considered to be high-theft items.
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Equipment Components Following are the individual components which contribute to the overall net change to equipment for the year:
2017
Purchases $ 6,363 Nontag – Write-off (3,043) Transfer In 4,495 Donated 0 Reclass Asset to Expense 0 Transfer Out (31,656) Net Change ($ 23,841)
Note 3: Operating Leases The lease agreement for the WNIQ repeater is still being worked on by the licensee. We anticipate an agreement to be executed during FY18. The total minimum lease payments for the years ending June 30, 2018, 2019, 2020, 2021, 2022 and 2023 are $17,800, $19,380, $7,680, $7,680, $7,680 and $1,280, respectively, for a total of $61,500.
Note 4: Pension Plan Northern Public Radio participates through the university in the State Universities Retirement System of Illinois (SURS), a cost-sharing multiple employer public employee retirement system.
Participation by eligible employees is mandatory. Employees are ineligible to participate if they (1) are receiving a retirement annuity from SURS; (2) are not employed for an academic term; (3) are classified as a student employee or extra-help employee; or (4) possess an F1 or J1 visa. Eligible employees must make an irrevocable choice between the traditional SURS retirement plan, a portable SURS option, or a self-managed plan that allows members to direct their retirement contributions into fund options selected by SURS.
Participants contribute 8 percent of their gross earnings and the employer contributes an additional amount based on an actuarially determined normal cost.
The SURS plan provides retirement, disability, and death benefits. Members are eligible for normal retirement at any age after 30 years of service, at age 55 after 8 years of service, or at age 62 after 5 years of service.
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Note 4: Pension Plan (continued) Employees may also elect to participate in one of several voluntary tax-deferred annuity programs offered through the university. These are single employer plans under which benefits are provided to participating employees through contracts issued to each participating employee. Participation and the level of contributions are voluntary. Northern Public Radio is not required to make contributions.
Northern Illinois University, Northern Public Radio’s licensee, and the State of Illinois have a special funding relationship which does not require the unfunded liability portion of the university’s pension to be reported on the face of the financial statements but is disclosed in their footnotes. Northern Public Radio’s portion of the amount shown by the university is $6,742,504.
Note 5: Contingent Liabilities Compensated Absences Liability for compensated absences (vacation and sick leave) is not reflected in these statements.
Note 6: Occupancy Formula The useful life of the Broadcast Center for the purpose of the occupancy calculation is 25 years.
Note 7: Subsequent Events Subsequent events are events or transactions that occur after the balance sheet date but before financial statements are issued or are available to be issued. These events and transactions either provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements (that is recognized subsequent events), or provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date (that is, non-recognized subsequent events).
The organization has evaluated subsequent events through February 9, 2018 the date the financial statements were available for issuance, and determined that there were no significant non-recognized subsequent events through that date.
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