NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
YEARS ENDED JUNE 30, 2017 AND 2016
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
YEARS ENDED JUNE 30, 2017 AND 2016
CONTENTS
Page
Independent auditors’ report 1-2
Consolidated financial statements:
Statements of financial position 3-4 Statements of activities 5-6 Statements of functional expenses 7-8 Statements of cash flows 9-10 Notes to financial statements 11-38
Supplementary information:
Schedule of expenditures of federal awards 39 Notes to schedule of expenditures of federal awards 40
Independent Auditors’ Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 41-42
Independent Auditors’ Report on Compliance for Each Major Program and on Internal Control Over Compliance Required by the Uniform Guidance 43-45
Single audit schedules:
Schedule of findings and questioned costs 46-47 Schedule of prior year findings and questioned costs 48
Independent Accountants’ Report on Compliance with Requirements of Applicable Laws and Regulations Prescribed by Administering Agency 49-50
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
YEARS ENDED JUNE 30, 2017 AND 2016
CONTENTS (CONTINUED)
Page
Summary of findings 51 Schedule of current year findings 52 Schedule of prior year findings 53
Supplemental financial schedules:
Consolidating statements of financial position 54-57 Consolidating statements of activities 58-61 Consolidating statements of functional expenses 62-65 Statements of functional expenses: Noble Network Support Team (NNST) 66 Noble Street College Prep 67 Rauner College Prep 68 Pritzker College Prep 69 Rowe Clark College Prep 70 Golder College Prep 71 Gary Comer College Prep 72 UIC College Prep 73 Muchin College Prep 74 Chicago Bulls College Prep 75 Johnson College Prep 76 Hansberry College Prep 77 DRW College Prep 78 Baker College Prep 79 Butler College Prep 80 ITW David Speer Academy 81 The Noble Academy 82 Mansueto High School 83 Noble Day Care 84 Noble Network Education Foundation 85 Statements of Activities – Summer of a Lifetime, A Noble Network Program 86
Independent Auditors’ Report
Board of Directors Noble Network of Charter Schools
Report on the Consolidated Financial Statements
We have audited the accompanying consolidated financial statements of Noble Network of Charter Schools, Subsidiaries and Affiliate (collectively referred to as the School), which comprise the consolidated statements of financial position as of June 30, 2017 and 2016, and the related consolidated statements of activities, functional expenses, and cash flows for the years then ended, and the related notes to the consolidated financial statements.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated 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 the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
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We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Noble Network of Charter Schools, Subsidiaries and Affiliate as of June 30, 2017 and 2016, and the changes in their net assets and their cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Other Information
Our audits were conducted for the purpose of forming an opinion on the consolidated financial statements as a whole. The supplemental financial schedules on pages 54 through 86 are presented for the purpose of additional analysis and are not a required part of the consolidated financial statements. The accompanying schedule of expenditures of federal awards, as required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, is presented for purposes of additional analysis and is also not a required part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The information has been subjected to the auditing procedures applied in the audits of the consolidated financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidated financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the consolidated financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated October 17, 2017, on our consideration of the School’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School’s internal control over financial reporting and compliance.
October 17, 2017
2
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
June 30, 2017 2016
ASSETS
Current assets: Cash $ 51,647,306 $ 54,939,695 Accounts receivable 9,289,351 8,844,245 Contributions receivable 7,613,673 11,546,418 Prepaid expenses 1,996,940 1,997,208 Cash - restricted by NMTC 10,399,174 Cash and investments - restricted by bond indenture 12,403,186 11,771,600 Investments - restricted for lease security deposit 361,332 Leverage loan notes receivable - NMTC 9,187,788
Total current assets 102,898,750 89,099,166
Property and equipment, net 108,491,523 89,975,438
Other assets: Contributions receivable, net of current portion 1,010,000 581,000 Cash - restricted by NMTC 2,604,562 Cash and investments - restricted by bond indenture net of current portion 11,174,245 Investments - restricted for student scholarships 2,589,641 2,616,057 Investments - restricted for lease security deposit 360,268 Leverage loan notes receivable - NMTC, net of current portion 24,878,829 14,808,362 Deposits 800,076 800,076
Total other assets 29,278,546 32,944,570
Total assets $ 240,668,819 $ 212,019,174
See notes to consolidated financial statements. 3
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (CONTINUED)
June 30, 2017 2016
LIABILITIES AND NET ASSETS
Current liabilities: Accounts payable and accrued expenses $ 15,770,403 $ 10,739,890 Bonds payable, net, current portion 11,819,140 10,310,390 Notes payable, net, current portion 15,730,424 1,287,615 Deferred lease incentive, current portion 199,046 199,046 Deferred revenue 2,352,568 1,957,314
Total current liabilities 45,871,581 24,494,255
Long-term liabilities: Bonds payable, net, net of current portion 36,732,186 48,551,330 Notes payable, net, net of current portion 38,454,378 28,633,993 Obligation under interest rate swap agreement 37 116,247 Deferred lease incentive, net of current portion 2,123,154 2,322,199 Deferred rent 2,605,893 2,414,829
Total long-term liabilities 79,915,648 82,038,598
Total liabilities 125,787,229 106,532,853
Net assets: Unrestricted: Board-designated 15,000,000 15,000,000 Undesignated 87,768,656 73,835,601
Total unrestricted 102,768,656 88,835,601
Temporarily restricted 12,112,934 16,650,720
Total net assets 114,881,590 105,486,321
Total liabilities and net assets $ 240,668,819 $ 212,019,174
See notes to consolidated financial statements. 4
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF ACTIVITIES
Years ended June 30, 2017 2016 Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total
Revenue: Chicago Public Schools: Per-capita tuition $ 92,749,746 $ 92,749,746 $ 94,199,385 $ 94,199,385 Facilities 5,568,390 5,568,390 5,281,125 5,281,125 Special education 14,747,093 14,747,093 13,272,148 13,272,148 Case manager stipends 26,652 26,652 48,217 48,217 Chapter I 9,112,283 9,112,283 8,367,705 8,367,705 Title I 8,423,092 8,423,092 8,018,094 8,018,094 Title II 1,094,172 1,094,172 1,032,347 1,032,347 Title III 22,128 22,128 112,364 112,364 English Language Learners 180,583 180,583 Growth funds $ 407,016 407,016 $ 1,006,960 1,006,960 Contributed services 4,514,170 4,514,170 4,818,948 4,818,948 Contributions and grants 2,834,237 6,774,874 9,609,111 1,252,915 20,244,935 21,497,850 Contributed services, other than CPS 1,015,300 1,015,300 E-rate discount funding 1,615,254 1,615,254 446,484 446,484 Food program 6,550,614 6,550,614 5,768,394 5,768,394 Instructional program - ROTC 238,436 238,436 344,172 344,172 Interest and dividends 575,304 575,304 539,185 539,185 Change in fair value of interest rate swap 116,210 116,210 (116,247) (116,247) Net realized and unrealized loss on investments (134,626) (134,626) (23,677) (23,677) Night school fees 200,601 200,601 216,602 216,602 Other revenue 231,722 231,722 220,783 220,783 Registration and tuition - Noble Day Care 762,152 762,152 698,133 698,133 School fees 3,082,474 3,082,474 2,913,422 2,913,422 School fundraising 78,045 78,045 66,532 66,532 Summer of a Lifetime, a Noble Network Program 729,831 518,996 1,248,827 752,364 580,822 1,333,186 Summer school fees 378,020 378,020 310,046 310,046 Uniform fees 567,463 567,463 667,681 667,681 Net assets released from restrictions: Satisfaction of purpose or time restrictions 12,238,672 (12,238,672) 12,654,414 (12,654,414)
Total revenue 167,518,018 (4,537,786) 162,980,232 161,861,536 9,178,303 171,039,839
See notes to consolidated financial statements. 5
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF ACTIVITIES (CONTINUED)
Years ended June 30, 2017 2016 Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total
Expenses: Program services $ 137,191,514 $ 137,191,514 $ 135,409,471 $ 135,409,471 Supporting services: Management and general 14,291,821 14,291,821 13,327,195 13,327,195 Fundraising 2,101,628 2,101,628 877,908 877,908
Total expenses 153,584,963 153,584,963 149,614,574 149,614,574
Change in net assets 13,933,055 $ (4,537,786) 9,395,269 12,246,962 $ 9,178,303 21,425,265 Net assets: Beginning of year 88,835,601 16,650,720 105,486,321 76,588,639 7,472,417 84,061,056
End of year $ 102,768,656 $ 12,112,934 $ 114,881,590 $ 88,835,601 $ 16,650,720 $ 105,486,321
See notes to consolidated financial statements. 6
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF FUNCTIONAL EXPENSES
Years ended June 30, 2017 2016 Supporting Services Supporting Services Program Management Program Management services and general Fundraising Total services and general Fundraising Total
Building maintenance and repairs $ 1,729,596 $ 11,562 $ 1,741,158 $ 1,347,812 $ 68,267 $ 1,416,079 Bonus salaries 5,625,973 657,282 $ 31,270 6,314,525 6,711,238 611,698 $ 52,400 7,375,336 Classroom furniture 458,151 458,151 677,365 677,365 Contracted maintenance services 2,311,678 1,011 2,312,689 2,260,691 14,248 2,274,939 Contractual services and stipends 1,648,157 1,680,870 1,415,297 4,744,324 1,109,530 1,350,315 125,960 2,585,805 Contributed services 427,520 427,520 CPS administrative fee 3,011,448 3,011,448 3,479,177 3,479,177 CPS facility fee 1,169,013 1,169,013 983,208 983,208 Depreciation and amortization 4,931,310 98,030 5,029,340 4,464,461 98,639 4,563,100 Educational materials 2,074,204 66,838 2,141,042 2,543,983 104,907 2,648,890 Employee benefits and payroll taxes 16,958,729 1,530,476 70,767 18,559,972 14,995,761 1,265,266 58,945 16,319,972 Extracurricular activities 1,007,511 1,007,511 1,547,034 1,547,034 Field studies 1,303,510 24,491 1,328,001 1,336,656 10,145 1,346,801 Food program 6,405,234 86 6,405,320 5,727,568 2,943 5,730,511 Fundraising events 27,380 27,380 44,019 44,019 Graduation 305,707 305,707 260,157 260,157 Insurance 685,939 685,939 543,592 543,592 Interest 3,247,760 228,874 3,476,634 3,627,269 267,623 3,894,892 Music program 232,208 232,208 227,077 227,077 Night school 192,563 192,563 273,483 273,483 Office furniture 48,116 8,058 56,174 80,174 57,471 137,645 Other expenses 402,374 480,129 89,827 972,330 371,995 422,998 10,032 805,025 Payroll processing fees 202,051 202,051 156,996 156,996 Postage and delivery 65,051 72,276 148 137,475 77,743 67,276 67 145,086 Printing and copying 1,028,520 96,684 2,523 1,127,727 1,178,859 87,995 4,783 1,271,637 Professional development 894,454 506,355 31,434 1,432,243 1,443,692 485,912 38,169 1,967,773 Rent 7,315,302 366,037 7,681,339 8,882,130 361,104 9,243,234 Salaries 61,210,038 7,818,280 329,398 69,357,716 59,252,523 7,045,895 442,322 66,740,740 Scholarships 1,910,493 1,910,493 1,113,195 1,113,195 Sports activities 1,304,625 33,124 1,337,749 1,368,878 229,228 1,598,106
See notes to consolidated financial statements. 7
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF FUNCTIONAL EXPENSES (CONTINUED)
Years ended June 30, 2017 2016 Supporting Services Supporting Services Program Management Program Management services and general Fundraising Total services and general Fundraising Total
Staff advertising and recruitment $ 56,444 $ 137,938 $ 200 $ 194,582 $ 103,373 $ 120,503 $ 331 $ 224,207 Summer of a Lifetime, A Noble Network Program 1,269,746 138,532 80,941 1,489,219 1,115,052 192,541 94,103 1,401,696 Summer school 388,655 388,655 338,465 338,465 Supplies 467,081 44,856 15 511,952 501,881 124,786 1,128 627,795 Technology 4,295,416 85,065 22,428 4,402,909 3,772,294 179,017 5,649 3,956,960 Transportation 932,040 2,900 934,940 1,072,495 1,386 1,073,881 Uniforms 919,335 919,335 833,380 833,380 Utilities 1,385,133 16 1,385,149 1,359,760 36 1,359,796
Total expenses $ 137,191,514 $ 14,291,821 $ 2,101,628 $ 153,584,963 $ 135,409,471 $ 13,327,195 $ 877,908 $ 149,614,574
See notes to consolidated financial statements. 8
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended June 30, 2017 2016
Cash flows from operating activities: Change in net assets $ 9,395,269 $ 21,425,265 Adjustments to reconcile change in net assets to net cash provided by operating activities: Depreciation and amortization 5,029,340 4,563,100 Amortization of lease incentive (199,045) (199,046) Amortization of deferred rent 191,064 144,685 Amortization of debt issuance costs 108,913 104,036 Debt forgiveness (1,250,000) Net realized and unrealized (gain) loss on investments 134,626 (11,531) Change in fair value of interest rate swap (116,210) 116,247 (Increase) decrease in operating assets: Accounts receivable (445,106) (332,267) Contributions receivable 3,503,745 (8,331,600) Prepaid expenses 268 144,348 Deposits (94,983) Accrued interest on leverage loan note receivable - NMTC (254,055) (192,161) Increase (decrease) in operating liabilities: Accounts payable and accrued expenses 5,030,513 133,012 Deferred revenue 395,254 (1,665,437)
Net cash provided by operating activities 21,524,576 15,803,668
See notes to consolidated financial statements. 9
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
Years ended June 30, 2017 2016
Cash flows from investing activities: Release of cash restricted by bond indenture $ 242,089 $ 3,844,578 Restriction of cash for NMTC (7,794,612) (340) Release of cash restricted for lease security deposit 720,029 Proceeds from sale of investments - restricted for bond indenture 10,216,000 424,000 Purchase of investments - restricted for student scholarships (23,640) (19,090) Purchase of investments - restricted for lease security deposit (1,064) (360,268) Purchase of property and equipment (23,545,423) (10,243,779) Issuance of leverage loan (notes receivable - NMTC) (19,004,200)
Net cash used in investing activities (39,910,850) (5,634,870)
Cash flows from financing activities: Payments on bonds payable (10,336,257) (1,278,754) Proceeds from notes payable 26,700,000 Payments on notes payable (860,398) (1,547,495) Payments for bond and NMTC issuance costs (409,460)
Net cash provided by (used in) financing activities 15,093,885 (2,826,249)
Net change in cash (3,292,389) 7,342,549 Cash, beginning of year 54,939,695 47,597,146
Cash, end of year $ 51,647,306 $ 54,939,695
Supplemental disclosure of cash flow information: Cash paid during the year for interest $ 3,470,513 $ 3,577,792
Supplemental disclosure of non-cash financing activities: Forgiveness of notes payable included in contributions and grants revenue $ 1,250,000
See notes to consolidated financial statements. 10 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Organization and purpose
Noble Network of Charter Schools (the School) was formed to provide educational and community opportunities for youths. The School plans to replicate by opening new campuses in Chicago. During the years ended June 30, 2017 and 2016, the School served the following students:
Opened in August Years ended June 30, 2017 2016
1999 Noble Street College Prep 632 626 2006 Rauner College Prep 634 613 2006 Pritzker College Prep 993 934 2007 Rowe Clark College Prep 538 551 2007 Golder College Prep 651 655 2008* Gary Comer College Prep 1,130 1,061 2008 UIC College Prep 899 890 2009 Muchin College Prep 939 879 2009 Chicago Bulls College Prep 1,123 1,104 2010 Johnson College Prep 857 842 2012 Hansberry College Prep 703 754 2012 DRW College Prep 533 609 2013 Baker College Prep 389 392 2013 Butler College Prep 577 441 2014 ITW David Speer Academy 815 681 2014 The Noble Academy 346 247 2016 Mansueto High School 179
11,938 11,938 11,279
*Includes Gary Comer Middle School which opened in August 2011.
11 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
1. Organization and purpose (continued)
The School is supported through per-capita tuition payments from the Chicago Public Schools, grants from state and federal agencies, various community and corporate foundations and the general public. During the years ended June 30, 2017 and 2016, the School received approximately 57% and 55%, respectively, of its support from per-capita tuition paid by Chicago Public Schools. Per-capita tuition payments are determined annually by Chicago Public Schools and may be adjusted or vary from year to year depending upon the amount of appropriations authorized by the Illinois General Assembly and subsequent approval by Chicago Public Schools of its budget on an annual basis.
The School is subject to a “Charter Agreement” with the Chicago School Reform Board of Trustees (Chicago Public Schools). The agreement was for an original term of five years which has been routinely renewed for the same term since the School’s inception. The current agreement expires on June 30, 2019. In addition, the School has been certified as a charter school by the Illinois State Board of Education.
The School is governed by a Board of Directors that is comprised of at least five and no more than twenty-five members, who serve one-year terms until his or her successor shall have been selected and qualified. Directors shall be elected annually.
Under state law, the Chicago Public Schools have oversight responsibility to verify that the School complies with and meets the expectation of a public educational system. The School is expected to satisfy regulations and compliance requirements by the Chicago Public Schools.
Activity for Summer of a Lifetime, a Noble Network Program, is included in the consolidated financial statements. Through the Summer of a Lifetime Program, low-income, minority scholars of the School are provided funding and support to participate in life-changing, summer academic enrichment programs on college campuses nationwide. The program is funded by philanthropic support.
12 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. Summary of significant accounting policies
Basis of accounting:
The School’s consolidated financial statements are prepared in accordance with generally accepted accounting principles (GAAP).
Principles of consolidation:
The accompanying consolidated financial statements include the accounts of Noble Day Care, L3C (Noble Day Care) and Noble Management, LLC, of which the Noble Network of Charter Schools (the Network) is the sole member and manager, and the Noble Network Education Foundation (the Foundation) collectively referred to as “the School.” Noble Management, LLC is the sole member and manager of Mansueto High School, LLC. The Network and the Foundation have common control since the Network appointed two of the five Foundation Directors (Appointed Directors) with the remaining three elected Directors selected from a slate of nominees approved by the Appointed Directors. All significant inter-organization transactions and balances have been eliminated in consolidation.
13 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. Summary of significant accounting policies (continued)
Basis of presentation:
The School reports information regarding its financial position and activities in three classes of net assets: unrestricted net assets, temporarily restricted net assets and permanently restricted net assets.
Unrestricted - Unrestricted net assets are available to finance the general operations of the School. The only limits on the use of unrestricted net assets are the broad limits resulting from the nature of the School, the environment in which it operates and the purposes specified in its Articles of Incorporation. Voluntary resolutions by the Board of Directors to designate a portion of the School’s unrestricted net assets for specified purposes do not result in restricted funds. Since designations are voluntary and may be reversed by the Board of Directors at any time, designated net assets are included under the caption “unrestricted net assets.”
The School’s Board-designated unrestricted net assets as of June 30, 2017 and 2016 consist of instructional and educational expenses to be used at the discretion of campus administration, upon approval of the Superintendent and CEO, as well as amounts to be used for future maintenance and repair costs of campus buildings.
Temporarily restricted - Temporarily restricted net assets result (a) from contributions and other inflows of assets, the use of which by the School is limited by donor-imposed stipulations that either expire by passage of time or can be fulfilled and removed by action of the School pursuant to those stipulations, (b) from other asset enhancements and diminishments subject to the same kinds of stipulations and (c) from reclassifications to (or from) other classes of net assets as a consequence of donor-imposed stipulations, their expiration by passage of time or their fulfillment and removal by actions of the School pursuant to those stipulations. See Note 18 for a description of temporarily restricted net assets at June 30, 2017 and 2016.
Permanently restricted - Permanently restricted net assets (generally referred to as endowment funds) are assets that have donor-imposed restrictions that stipulate that the contributed resources be maintained permanently, but permit the entity to utilize or expend part or all of the income or other economic benefits derived from the donated assets. The School has no permanently restricted net assets.
14 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. Summary of significant accounting policies (continued)
Unrestricted and restricted revenue and support:
Contributions received are recorded as unrestricted, temporarily restricted or permanently restricted support depending on the existence and/or nature of any donor restrictions.
Donor-restricted support is reported as an increase in temporarily or permanently restricted net assets depending on the nature of the restriction. When a restriction expires (that is, when a stipulated time restriction ends or purpose of restriction is accomplished), temporarily restricted net assets are reclassified to unrestricted net assets and reported in the consolidated statements of activities as net assets released from restrictions.
Expense allocation:
The costs of providing various programs and other activities have been summarized on a functional basis in the consolidated statements of activities. Accordingly, certain costs have been allocated among the programs and supporting services benefited. Expenses for program services represented approximately 89% and 91% of total expenses for the years ended June 30, 2017 and 2016, respectively.
Derivative instruments:
The School makes limited use of derivative instruments for the purpose of managing interest rate risks. An interest rate swap agreement is used to convert variable rate debt to a fixed rate (see Note 10). The differentials paid or received on the interest rate swap agreement is accrued and recognized as adjustments to interest rate expense; gains and losses realized upon settlement of this agreement is deferred until the underlying hedge instrument is settled.
Accounts receivable:
Accounts receivable consist of grants and other amounts due from Chicago Public Schools and other governmental agencies as well as student fees net of an allowance for doubtful accounts. The School estimates the allowance based on an analysis of specific account history and experience. It is the School’s policy to charge off uncollectible accounts receivable when management determines the receivable will not be collected. An allowance for doubtful accounts is considered unnecessary and is not provided for years ended June 30, 2017 and 2016.
15 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. Summary of significant accounting policies (continued)
Contributions receivable:
Contributions receivable include unconditional promises to give net of an allowance for doubtful accounts. The School estimates the allowance based on an analysis of specific donor history and experience. Pledges due in more than one year are discounted using a risk-adjusted rate of return to reflect the present value of the receivables.
June 30, 2017 2016
Receivable due in less than one year $ 7,613,673 $ 11,546,418 Receivable due in one to five years 1,010,000 581,000
Unconditional promises to give $ 8,623,673 $ 12,127,418
An allowance for doubtful accounts is considered unnecessary and is not provided for the years ended June 30, 2017 and 2016.
Bond and NMTC issuance costs:
During the year ended June, 30, 2017, the School adopted new authoritative GAAP guidance for the presentation of debt issuance costs and related amortization. Debt issuance costs are now reported on the consolidated statements of financial position as a direct deduction from the face amount of debt. Previously, such costs were shown as a deferred charge in the consolidated statements of financial position and amortized using the interest method over the lives of the bonds and NMTC payables. Accordingly, total assets and liabilities decreased by $2,541,161 for year ended June 30, 2016. The School continues to reflect amortization of debt issuance costs as interest expense, in accordance with the new guidance. The change had no effect on previously reported net assets or change in net assets.
Property and equipment:
Property and equipment are stated at cost or, if donated, at the approximate fair value at date of donation. Amortization of leasehold improvements is provided ratably over the lesser of the term of the lease or the estimated life of the improvements. Depreciation is provided over the estimated useful life of the assets using the straight-line method ranging from three to thirty-nine years. Major additions over $5,000 are capitalized while replacements, maintenance and repairs, which do not improve or extend the lives of the respective assets, are expensed as incurred.
16 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. Summary of significant accounting policies (continued)
Deferred lease incentive:
The School amortizes lease incentives against rent expense over the lease term.
Deferred revenue:
Deferred revenue results from the School recognizing textbook, uniform, and other student fees collected as revenue in the period in which the related educational instruction is performed, as well as receiving cash for conditional contributions and grants of which the conditions have not yet been met. Accordingly, revenue for student fees received for the next school term is deferred until the instruction commences and contributions and grants received are deferred until the conditions are met.
Deferred rent:
The School records rent expense on a straight-line basis over the life of the related leases. The difference between rent expense recorded and the amount paid is charged to deferred rent in the consolidated statements of financial position.
Contributed goods and services:
Contributed goods are reflected as contributions at their fair value at date of donation and are reported as unrestricted support unless explicit donor stipulations specify how donated assets must be used. The School recognizes the fair value of contributed services received if such services a) create or enhance nonfinancial assets or b) require specialized skills that are provided by individuals possessing those skills and would typically need to be purchased if not contributed. The School receives services from a large number of volunteers who give significant amounts of their time to the School but do not meet the criteria for financial statement recognition.
For the years ended June 30, 2017 and 2016, the School was the recipient of employer pension expense made on behalf of the School by Chicago Public Schools and donated rent for the use of Chicago Public Schools’ buildings by various campuses.
17 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. Summary of significant accounting policies (continued)
Contributed goods and services: (continued)
The School recognized $5,430,408 of contributed shares of stock and $1,015,300 of specialized consulting services during the year ended June 30, 2017, which is included in contributions and grants revenue and contributed services revenue in the consolidated statements of activities. The School recognized $5,419,482 of contributed shares of stock during the year ended June 30, 2016, which is included in contributions and grants revenue in the consolidated statements of activities.
Use of estimates:
The preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures in the consolidated financial statements. Accordingly, actual results could differ from those estimates.
Reclassification:
Certain amounts from the prior year have been reclassified in order to conform to the current year’s presentation.
Subsequent events:
Management has evaluated subsequent events through October 17, 2017, the date that the consolidated financial statements were issued.
3. Tax status
The School is a tax-exempt organization as described in Section 501(c)(3) of the Internal Revenue Code (the Code) and is exempt from federal income taxes on related income pursuant to Section 501(a) of the Code. In addition, the Internal Revenue Service has determined that the School is not a private foundation within the meaning of Section 509(a) of the Code. The School has adopted the requirements for accounting for uncertain tax positions and management has determined that the School was not required to record a liability related to uncertain tax positions as of June 30, 2017 and 2016.
18 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
4. Cash
The School maintains its cash in bank accounts which, at times, exceed federally-insured limits. At June 30, 2017 and 2016, cash in excess of these limits totaled approximately $61,600,000 and $57,100,000, respectively. Management believes that the School is not exposed to any significant credit risk on cash.
5. Fair value measurements
The three levels of the fair value hierarchy are described as follows:
Level 1 Inputs to valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the School has the ability to access.
Level 2 Inputs to the valuation methodology include:
l quoted prices for similar assets or liabilities in active markets;
l quoted prices for identical or similar assets or liabilities in inactive markets;
l inputs other than quoted prices that are observable for the asset or liability;
l inputs that are derived principally from or corroborated by observable market data by correlation or other means.
If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.
Level 3 Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.
19 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
5. Fair value measurements (continued)
The following table sets forth by level, within the fair value hierarchy, the School’s financial instruments at fair value as of June 30, 2017:
June 30, 2017 Total Level 1 Level 2
Recurring fair value measurements: Assets: Cash and investments: Certificate of deposit $ 361,332 $ 361,332 Fixed income mutual funds 2,475,165 2,475,165 United States Government treasury bonds 11,267,010 11,267,010 Cash investments 1,250,652 1,250,652
Total cash and investments 15,354,159 15,354,159
Liability: Interest rate swap derivative (37) $ (37)
Total recurring fair value measurements $ 15,354,122 $ 15,354,159 $ (37)
Nonrecurring fair value measurements: Asset: Leverage loan notes receivable - NMTC $ 34,066,617 $ 34,066,617
Liabilities: Bonds payable 48,551,326 48,551,326 Notes payable 54,184,802 54,184,802
Total nonrecurring fair value measurements $ 136,802,745 $ 136,802,745
20 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
5. Fair value measurements (continued)
The following table sets forth by level, within the fair value hierarchy, the School’s financial instruments at fair value as of June 30, 2016:
June 30, 2016 Total Level 1 Level 2
Recurring fair value measurements: Assets: Cash and investments: Certificate of deposit $ 360,268 $ 360,268 Fixed income mutual funds 2,590,772 2,590,772 United States Government treasury bonds 21,512,336 21,512,336 Cash investments 1,458,794 1,458,794
Total cash and investments 25,922,170 25,922,170
Liability: Interest rate swap derivative (116,247) $ (116,247)
Total recurring fair value measurements $ 25,805,923 $ 25,922,170 $ (116,247)
Nonrecurring fair value measurements: Asset: Leverage loan notes receivable - NMTC $ 14,808,362 $ 14,808,362
Liabilities: Bonds payable 58,861,720 58,861,720 Notes payable 29,921,608 29,921,608
Total nonrecurring fair value measurements $ 103,591,690 $ 103,591,690
21 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
5. Fair value measurements (continued)
Following is a description of the valuation methodologies used for assets measured at fair value.
Mutual funds are valued at the Net Asset Value (NAV) of shares held by the School at year-end.
United States Government treasury bonds are stated at fair value based on quoted prices in active markets.
Cash investments are stated at cost which approximates fair value.
The interest rate swap derivative is valued using pricing models that use observable outputs.
The leverage loan notes receivable – NMTC fair value approximates the carrying amount in the accompanying consolidated financial statements. The carrying value of the loans approximates fair value based on current borrowing rates.
Long-term obligations, including bonds payable and notes payable, fair value approximates the carrying amounts in the accompanying consolidated financial statements. The carrying value of the debt approximates fair value based on current borrowing rates.
The preceding methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although the School believes that its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
22 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
6. Property and equipment
Property and equipment are as follows:
June 30, 2017 2016
Leasehold improvements $ 70,010,386 $ 68,823,397 Building 26,710,276 26,654,059 Land 6,423,651 6,423,651 Equipment 8,467,620 7,278,129 Furniture 1,077,275 1,077,275 Software 476,540 393,044 Automobiles 145,561 179,082
113,311,309 110,828,637 Less accumulated depreciation and amortization (27,764,215) (22,751,636)
85,547,094 88,077,001 Construction in progress 22,944,429 1,898,437
Property and equipment, net $ 108,491,523 $ 89,975,438
7. Leverage loan notes receivable – NMTC and notes payable – NMTC
2011 New Market Tax Credits:
The School negotiated a New Markets Tax Credits (NMTC) to finance and reimburse the School in connection with the renovation and construction of school facilities and to finance the acquisition of related equipment, furniture, textbooks and other items located in Qualified Census Tracts. The School qualifies as a Qualified Active Low-Income Community Business (QALICB), within the meanings of Section 45D of the Internal Revenue Code of 1986, as amended (the Code) and Section 1.45D of the Treasury Regulations promulgated thereunder (the Treasury Regulations).
State NMTC Investors contributed $1,950,000 in State NMTC equity to Stonehenge Illinois NMTC Investment Fund II, LLC (State Investment Fund). In conjunction with this equity investment, the School then made an $8,050,000 leverage loan (note receivable – 2011 NMTC) to the State Investment Fund.
23 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
7. Leverage loan notes receivable – NMTC and notes payable – NMTC (continued)
2011 New Market Tax Credits: (continued)
The note receivable – 2011 NMTC held by the Foundation is payable by the State Investment Fund over 30 years and matures on May 30, 2041. Interest compounds at 3.08127% per annum.
The State Investment Fund will pay interest at a rate of 1.00% ($80,500 per year) for the initial seven years of the note after which time annual principal and interest payments due from the State Investment Fund will be $569,222. As collateral for the note, the State Investment Fund has assigned its 99.99% interest in the State Sub-Community Development Entity.
In conjunction with the NMTC transaction, the School received a loan in the amount of $13,000,000 from PNBI Subsidiary CDE 3, LLC (NMTC Lender), a Federal Sub-Community Development Entity, financed through equity provided by both state and federal new markets tax credit investors and the leveraging of the Foundation. The loan was comprised of two tranches, $10,000,000 QLICI Note A and $3,000,000 QLICI Note B (collectively referred to as notes payable – 2011 NMTC).
The notes payable – 2011 NMTC held by the School include a simple interest rate of 1.34049% and are payable over 30 years and mature on May 30, 2041. Under Note A, the School will pay interest only of $134,049 annually for the initial seven years of the Note after which annual principal and interest payments will be $505,968. Under Note B, the School will pay interest only of $40,215 annually for the initial seven years of the Note after which annual principal and interest payments will be $146,701.
Note A and Note B are pari passu (equal rights) in rights of payment and principal, interest, escrow items, late charges and all other amounts payable. Under terms of the NMTC transaction, the School is also obligated to pay annual loan servicing fees of $32,500 and annual asset management fees of $100,581.
24 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
7. Leverage loan notes receivable – NMTC and notes payable – NMTC (continued)
2011 New Market Tax Credits: (continued)
As collateral for the notes payable, the School has pledged the Rowe Clark Gymnasium as well as all rights, title and interest in, to and under leases and rents related to the property, if any. As additional collateral, the School has pledged money held in various accounts. The net book value or fair value of the collateral pledged in conjunction with the notes payable – 2011 NMTC is as follows:
June 30, 2017 2016
Rowe Clark gymnasium - net book value $ 4,101,965 $ 4,216,602 Various cash accounts with financial institutions - fair value 2,604,900 2,604,562
Total security pledged in connection with notes payable – NMTC $ 6,706,865 $ 6,821,164
After the seven-year NMTC period expires, if the School has performed its obligations under the NMTC financing arrangement, the School may be able to gain control of and cancel, approximately $5,000,000 of the $13,000,000 indebtedness through the mutual forgiveness of the $8,050,000 note receivable – 2011 NMTC and the $13,000,000 notes payable – 2011 NMTC. The School can gain control of such debt in one of two ways: (1) the state and/or federal tax credit investors can exercise a put option giving the notes payable – 2011 NMTC to the School for $1,000 or (2) if such put is not exercised, the School would be able to exercise a call option on the notes payable – 2011 NMTC by paying the fair market value of the state and federal tax credit investors’ interests in the entities that provided the funds, in the form of equity or loans, needed for the NMTC lender to make the NMTC loan. It is expected that the gain of $5,000,000 will be reduced by the forgiveness of accrued interest receivable of approximately $1,300,000 and an exit fee of $100,581 for a net gain of $3,600,000.
2015 New Market Tax Credits:
The School entered into a second NMTC transaction to finance and reimburse the School in connection with the purchase and construction of a new school facility and to finance related equipment and furniture for its ITW David Speer Academy located in a Qualified Census Tract.
25 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
7. Leverage loan notes receivable – NMTC and notes payable – NMTC (continued)
2015 New Market Tax Credits: (continued)
In conjunction with the NMTC transaction, the School then made a $5,819,200 leverage loan (note receivable – 2015 NMTC) to Chase NMTC Noble ITW Investment Fund, LLC (the NMTC Investment Fund). The note receivable – 2015 NMTC is payable by the NMTC Investment Fund over 30 years and matures on April 30, 2045. The NMTC Investment Fund will pay interest only at a rate of 1.00% ($58,192 per year) for the initial seven years after which time annual principal and interest payments due from the NMTC Investment Fund will be $283,536.
As collateral for the note, the NMTC Investment Fund has assigned its 99.99% interest in BH New Markets Sub-CDE III, LLC (the ITW NMTC Lender).
Simultaneous with the closing of the NMTC transaction, the School entered into a term loan for $5,700,000 from BMO Harris Bank.
As part of the NMTC transaction, the School received a loan for $7,920,000 from the ITW NMTC Lender. The loan was comprised of two tranches, $5,819,200 QLICI Note A and $2,100,800 QLICI Note B (collectively referred to as notes payable – 2015 NMTC). The notes payable include a simple interest rate of 1.40401% and interest payments are payable monthly over the life of the notes. The notes shall mature on the earlier of April 30, 2045 or the date which the unpaid principal balance becomes due and payable by acceleration or otherwise pursuant to the loan documents or the exercise by the ITW NMTC Lender of any right or remedy. Under Note A, the School will pay interest only of $81,702 annually for the initial seven years after which annual principal and interest payments will be $296,496. Under Note B, the School will pay interest only of $29,495 annually for the initial seven years after which annual principal and interest payments will be $107,040. Note A and Note B are pari passu (equal rights) in rights of payment and principal, interest, escrow items, late charges and all other amounts payable. The loan agreement is subordinate to the note below and secured by a second priority mortgage of the ITW David Speer Academy building and assignments of rents. Under terms of the NMTC transaction, the School is also obligated to pay annual loan servicing fees of $20,000.
26 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
7. Leverage loan notes receivable – NMTC and notes payable – NMTC (continued)
2015 New Market Tax Credits: (continued)
It is anticipated that the School will be in compliance with all NMTC program requirements for the seven-year NMTC compliance period ending on September 30, 2021. At the end of the seven years, Chase Community Equity, LLC (the NMTC investor) has the right under a put/call option agreement to put 100% of its membership interest in the NMTC Investment Fund to the School for a purchase price of $1,000. If the put right is not exercised by the NMTC investor, the School has the option to purchase 100% of the NMTC investor’s membership interest in the NMTC Investment Fund for its then appraised fair value. At that time, it is anticipated that the School may be able to gain control of and cancel, approximately $2,100,000 of the $7,920,000 indebtedness through the mutual forgiveness of the $5,819,200 note receivable – 2015 NMTC and the $7,920,000 notes payable – 2015 NMTC.
2017 New Market Tax Credits:
On March 16, 2017, the School entered into a third NMTC transaction to finance and reimburse the School for the purchase and construction of a new school facility and to finance related equipment and furniture for its Mansueto High School located in a Qualified Census Tract.
In conjunction with the NMTC transaction, the School received a bridge loan of $12,000,000 from JPMorgan Chase Bank, N.A. to fund a $19,004,200 leverage loan (note receivable – 2017 NMTC) to Chase NMTC Mansueto Investment Fund, LLC (the NMTC Investment Fund). The note receivable – 2017 NMTC is payable by the NMTC Investment Fund over 30 years and matures on March 31, 2047. The NMTC Investment Fund will pay interest only at a rate of 1.00% ($190,042 per year) for the initial seven years after which time annual principal and interest payments due from the NMTC Investment Fund will be $929,036.
As collateral for the note, the NMTC Investment Fund has assigned its 99.99% interest in (i) BH New Markets Sub-CDE XIII, LLC (the BMO CDE); (ii) SCORE Sub-CDE 9, LLC, (the SCORE CDE), and (iii) CNI Subsidiary CDE 1, LLC (the CNI CDE), together with the BMO CDE and SCORE CDE, the “CDEs” (collectively, the “Mansueto NMTC Lender”).
27 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
7. Leverage loan notes receivable – NMTC and notes payable – NMTC (continued)
2017 New Market Tax Credits: (continued)
As part of the NMTC transaction, the School received a loan for $26,700,000 from the Mansueto NMTC Lender. The loan was comprised of two tranches, QLICI Note A and QLICI Note B from each of the CDEs (collectively referred to as notes payable – 2017 NMTC). The notes payable include a simple interest rate of 1.32599% with interest due annually over the life of the notes. The notes shall mature on the earlier of March 31, 2047 or the date which the unpaid principal balance becomes due and payable by acceleration or otherwise pursuant to the loan documents or the exercise by the Mansueto NMTC Lender of any right or remedy. Under Notes A and B, the School will pay interest only annually for the initial seven years of $354,039 after which annual principal and interest payments will be $1,347,296. The loan agreement is collateralized by a first priority mortgage of the Mansueto building and assignments of rents. Under terms of the NMTC transaction, the School is also obligated to pay annual loan servicing fees of $50,000.
It is anticipated that the School will be in compliance with all NMTC program requirements for the seven-year NMTC compliance period ending on March 16, 2024. At the end of the seven years, Chase Community Equity, LLC (the NMTC investor) has the right under a put/call option agreement to put 100% of its membership interest in the NMTC Investment Fund to the School for a purchase price of $1,000. If the put right is not exercised by the NMTC investor, the School has the option to purchase 100% of the NMTC investor’s membership interest in the NMTC Investment Fund for its then appraised fair value. At that time, principal payments of $141,890 will be due from the School and it is anticipated that the School may be able to gain control of and cancel, approximately $7,700,000 of the $26,700,000 indebtedness through the mutual forgiveness of the $19,004,200 note receivable – 2017 NMTC and the $26,700,000 notes payable – 2017 NMTC.
Leverage notes receivable – NMTC outstanding at June 30, 2017 and 2016 are summarized below:
June 30, 2017 Original note Accrued interest Total
2017 NMTC $ 19,004,200 $ 55,430 $ 19,059,630 2015 NMTC 5,819,200 5,819,200 2011 NMTC 8,050,000 1,137,787 9,187,787
Total leverage notes receivable - NMTC $ 32,873,400 $ 1,193,217 $ 34,066,617
28 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
7. Leverage loan notes receivable – NMTC and notes payable – NMTC (continued)
June 30, 2016 Original note Accrued interest Total
2015 NMTC $ 5,819,200 $ 5,819,200 2011 NMTC 8,050,000 $ 939,162 8,989,162
Total leverage notes receivable - NMTC $ 13,869,200 $ 939,162 $ 14,808,362
The applicable Loan Agreements for the NMTC transactions contain various covenants. The School is in compliance with all loan covenants as of June 30, 2017 and 2016.
NMTC – notes payable are summarized below:
June 30, 2017 2016
Notes payable - 2017 NMTC $ 26,700,000 Notes payable - 2015 NMTC 7,920,000 $ 7,920,000 Notes payable - 2011 NMTC 13,000,000 13,000,000
Total notes payable - NMTC 47,620,000 20,920,000 Unamortized NMTC - notes payable issuance costs (573,107) (246,699)
Notes payable - NMTC, net $ 47,046,893 $ 20,673,301
See Note 9 for notes payable.
29 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
8. Bonds payable
Bonds payable are summarized as follows:
June 30, 2017 2016
Series 2015 bonds payable with interest only payable semi-annually on March 1 and September 1, at rates ranging from 1.5% to 5%. Principal payments (net of reoffering premiums of $1,470,442 and $1,569,573 for the years ended June 30, 2017 and 2016, respectively) are payable annually on September 1 through maturity in 2032. The bonds are collateralized by various campus facilities. $ 19,655,677 $ 20,464,573
Series 2013 bonds payable with interest only payable semi-annually on March 1 and September 1, at rates ranging from 6% to 6.25%. Principal payments (net of discounts of $82,279 and $86,024 for the years ended June 30, 2017 and 2016, respectively) are payable annually beginning September 1, 2023 through maturity in 2039. The bonds are collateralized by various campus facilities. 19,917,721 19,913,976
Series 2007A bonds payable with interest payable semi-annually on March 1 and September 1, at rates ranging from 4.10% to 5%. Principal payments (net of reoffering premiums of $100,330 and $107,056 for the years ended June 30, 2017 and 2016, respectively) are payable annually on September 1. The bonds were defeased with the issuance of the Series 2015 bonds and are to be redeemed in full on September 1, 2017. 11,135,330 11,555,807
Series 2006C bonds payable with interest payable semi-annually on March 1 and September 1, at rates ranging from 4% to 4.40%. Principal payments (net of reoffering premium of $80,575 for the year ended June 30, 2016) were payable annually on September 1. The bonds were defeased with the issuance of the Series 2015 bonds and were redeemed in full on September 1, 2016. 9,221,826
Total bonds payable 50,708,728 61,156,182 Unamortized bond issuance costs (2,157,402) (2,294,462)
Bonds payable, net 48,551,326 58,861,720 Less current portion, net (11,819,140) (10,310,390)
Long-term portion, net $ 36,732,186 $ 48,551,330
30 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
8. Bonds payable (continued)
Subsequent to June 30, 2017, the School made the final redemption payment of $11,035,000 on the Series 2007A bonds payable.
The loan agreements relating to the bonds require the School to comply with certain financial covenants and places restrictions on various activities, such as the transfer of assets and incurrence of additional indebtedness. At June 30, 2017 and 2016, the School was in compliance with all of the financial covenants.
Future minimum principal payments are as follows:
Year ending June 30: Amount
2018 $ 11,956,199 2019 956,199 2020 986,199 2021 1,031,199 2022 1,076,199 Thereafter 34,702,733
Total $ 50,708,728
31 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
9. Notes payable
Notes payable are summarized as follows:
June 30, 2017 2016
IFF note payable in monthly installments of $6,682, which includes interest at 5.84% per annum and matures on June 1, 2023. The note is collateralized various campus property and equipment. $ 405,025 $ 459,806
IFF note payable in monthly installments of $8,013, which includes interest at 5.68% per annum and matures on November 1, 2019. The note is collateralized by various campus property and equipment. 589,320 654,241
Charter School Growth Fund note payable with interest accruing at a rate of 1% per annum and matures June 30, 2018. Total principal and accrued interest payable at maturity. 500,000 500,000
Charter School Growth Fund note payable with interest accruing at a rate of 1% per annum and matures June 30, 2019. Principal payments are due annually starting June 20, 2018 with the final payment and total accrued interest due at maturity. 1,750,000 3,000,000
Charter School Growth Fund note payable with interest accruing at a rate of 1% per annum and matures on June 30, 2020. Total principal and accrued interest payable at maturity. 375,000 375,000
BMO Harris Bank note payable in monthly installments of $61,728, which includes interest at LIBOR plus 2.5% per annum and matures on April 17, 2022. The note is collateralized by a first priority mortgage of a campus building and assignment of rents. 3,518,564 4,259,260
Notes payable - NMTC, net (See Note 7) 47,046,893 20,673,301
Total notes payable 54,184,802 29,921,608 Less current portion (15,730,424) (1,287,615)
Long-term portion, net $ 38,454,378 $ 28,633,993
32 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
9. Notes payable (continued)
The above notes payable require the School to comply with certain financial covenants. At June 30, 2017 and 2016, the School was in compliance with all of the financial covenants.
Future minimum principal payments are as follows:
Year ending June 30: Amount
2018 $ 15,867,096 2019 1,124,026 2020 1,630,328 2021 809,898 2022 677,582 Thereafter 34,648,979
54,757,909 Less unamortized NMTC - notes payable issuance costs (573,107)
Notes payable, net $ 54,184,802
10. Interest rate swap
The School entered into an ISDA Master (Swap) Agreement with BMO Harris Bank for a notional amount of $5,000,000, with an effective date of July 17, 2015 and a maturity date of April 15, 2022, in which the School will make interest payments based upon a fixed rate of 1.64% commencing on August 17, 2015 in exchange for BMO Harris Bank to make interest payments to the School based on a floating rate of one-month LIBOR rate through and including the maturity date. However, the swap agreement may be terminated at any time. The notional amount under the swap will decline in lockstep with principal redemption payment on the BMO Harris Bank loan (see Note 9) so that the notional amount does not exceed the principal amount outstanding under the BMO Harris Bank loan. The swap is designed to hedge the risk of changes in interest rate payments on the BMO Harris Bank loan caused by changes in the floating interest rates.
33 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
10. Interest rate swap (continued)
The swap was issued at market terms so that it had no fair value at its inception. The carrying amount of the swap has been adjusted to its fair value as of June 30, 2017, which because of changes to future implied levels of one-month LIBOR, resulted in reporting a liability of $37 for the fair value of the future net payments forecasted under the swap. The change in fair value of the swap is reported in the consolidated statements of activities.
11. Conditional promises to give
The School records revenue associated with conditional promises to give when the conditions have been substantially met. As of June 30, 2017, the School has approximately $21,500,000 of conditional promises associated with expansion and student scholarships that have not yet been recognized as revenue.
12. Commitments and contingencies
The School has received funds from state and federal grants in the current year which are subject to audits by the granting agencies. Management believes that any adjustments that might arise from these audits would be insignificant to School operations.
As of June 30, 2017, the School had entered into construction contracts totaling approximately $21,941,000 to build the Mansueto High School, of which $18,656,000 had been incurred as of June 30, 2017.
13. Scholarship funds
In recognition of a grant received, the School committed to fund a $10,000 scholarship per year in perpetuity from its operating budget to be named the Osborn Family Scholarship program.
In addition, the School has received contributions restricted to fund scholarships. Scholarships are awarded through an application process and based on financial need and merit.
14. School lunch program
For the years ended June 30, 2017 and 2016, the School has contracted with a third party to administer the School’s breakfast, lunch and summer food service program under an annual agreement with optional one-year renewals. Under this agreement, the School collects all fees related to this program and purchases the necessary quantity of meals through the third party.
34 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
15. Self-insurance program
Effective January 1, 2016, the School maintains a self-insurance program for its employees’ health care costs. The School is liable for losses on claims up to $155,000 per covered person and up to approximately $4,600,000 in aggregate for 2017. The School has third-party insurance coverage for any losses in excess of such amounts. Self-insurance costs are accrued based on claims reported as of the date of the consolidated financial statements as well as an estimated liability for claims incurred but not reported. The total accrued liability for self-insurance costs was approximately $558,000 and $850,000 as of June 30, 2017 and 2016, respectively, and is included in accounts payable and accrued expenses on the consolidated statements of financial position.
16. Retirement fund commitments
The School participates in the Public School Teachers’ Pension and Retirement Fund of Chicago (the Fund), a defined-benefit plan. Members of the Fund include all active nonannuitants who are employed by a Fund-covered employer and who hold an Illinois State Teacher Certification Board certification. The State of Illinois appropriates public contributions to the Chicago Public Schools and remits those contributions to the Fund on behalf of applicable Chicago schools’ employer contributions.
During the years ended June 30, 2017 and 2016, the Chicago Public Schools withheld the employer contribution related to pensionable salaries, other than special education instructors, from the per-capita tuition that was paid to the School. In addition, Chicago Public Schools contributed the employer contribution related to pensionable salaries of special education instructors. For the year ended June 30, 2017, the amount of employer contributions was estimated at $4,357,121 (based on pensionable salaries of $39,042,307), which approximates 11.16% of pensionable salary and includes $1,015,548 (based on pensionable salaries of $9,099,894) as contributed by the Chicago Public Schools and recorded as contributed services revenue. For the year ended June 30, 2016, the amount of employer contributions was estimated at $4,051,182 (based on pensionable salaries of $36,300,916), which approximates 11.16% of pensionable salary and includes $997,175 (based on pensionable salaries of $8,935,257) as contributed by the Chicago Public Schools and recorded as contributed services revenue.
In addition, the School has elected to pay a portion of its employees’ contributions to the Fund. During the years ended June 30, 2017 and 2016, the School paid $2,732,961 and $2,541,064, respectively, in pension contributions to the Fund. The Fund does not maintain separate actuarial records for the School.
35 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
16. Retirement fund commitments (continued)
In addition, all employees were eligible to participate in the Noble Network of Charter Schools 401(k) P/S Plan (P/S Plan). Employees can elect to defer their compensation up to the maximum allowed. The School matches employee deferral contributions up to a maximum of 5% of compensation or $2,000 semiannually. Contributions paid by the School to the Plan during the years ended June 30, 2017 and 2016 were $515,301 and $505,323, respectively.
17. Leases agreements
The School rents various facilities under leases expiring through 2035. Some of the leases contain renewal provisions ranging from 10 to 15 years. Annual rent under the leases ranges from $1 to $2,129,000. Security deposits totaling $1,161,408 are held by the landlords. In addition, the use of certain facilities are donated to the School.
Total rent expense was $3,986,283, excluding contributed rent of $3,496,081, and $5,848,761, excluding contributed rent of $3,394,473, for the years ended June 30, 2017 and 2016, respectively.
Future minimum building rental commitments are estimated as follows:
Year ending June 30: Amount
2018 $ 3,892,928 2019 3,979,229 2020 4,044,879 2021 3,516,047 2022 3,295,881 Thereafter 28,746,943
Total $ 47,475,907
36 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
18. Temporarily restricted net assets
Temporarily restricted net assets are available for the following purpose or time restrictions:
June 30, 2017 2016
Restricted for purpose: College readiness program $ 1,000,411 $ 76,192 Extracurricular activities 33,214 5,989 Other programs 236,946 56,306 Scholarships 2,724,322 3,046,798 Startup and growth activities and costs 6,093,464 11,974,032 Summer of a Lifetime program 518,996 480,822
Total restricted for purpose 10,607,353 15,640,139
Restricted for time 1,505,581 1,010,581
Total temporarily restricted net assets $ 12,112,934 $ 16,650,720
37 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
18. Temporarily restricted net assets (continued)
During the years ended June 30, 2017 and 2016, net assets were released from donor restrictions by incurring expenses satisfying the following purpose or time restrictions:
Years ended June 30, 2017 2016
Restricted for purpose: College readiness program $ 340,781 $ 272,000 Extracurricular activities 123,231 50,419 Other programs 194,539 485,882 Principal internship program 100,000 Scholarships 2,054,070 1,051,576 Startup and growth activities and costs 7,630,229 8,358,239 Summer of a Lifetime program 480,822 355,338
Total restricted for purpose 10,823,672 10,673,454
Restricted for time 1,415,000 1,980,960
Total net assets released from restrictions $ 12,238,672 $ 12,654,414
38
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2017
Pass-through Federal Entity CFDA Identifying Federal Grantor/Pass-through Grantor/Program or Cluster Title Number Number Project Year Total
U.S. Department of Education: Charter Schools* 84.282 October 1, 2015 - September 30, 2016 $ 424,753 Charter Schools* 84.282 October 1, 2016 - September 30, 2017 513,892 Total Charter Schools 938,645 Pass-through programs from Illinois State Board of Education: Title I Grants to Local Educational Agencies 84.010 150162990AF July 1, 2015 - June 30, 2016 182,079 Title I Grants to Local Educational Agencies 84.010 150162990AF July 1, 2016 - June 30, 2017 7,975,022 Total Title I Grants to Local Educational Agencies 8,157,101
English Language Acquisition State Grants (Title III) 84.365 150162990AF July 1, 2016 - June 30, 2017 22,128
Supporting Effective Instruction State Grants (Title II)* 84.367 150162990AF July 1, 2016 - June 30, 2017 1,101,261
Food and Nutrition Service, Department of Agriculture: Pass-through programs from Illinois State Board of Education: School Breakfast Program* 10.553 150162990AF October 1, 2015 - September 30, 2016 177,724 School Breakfast Program* 10.553 150162990AF October 1, 2016 - September 30, 2017 1,202,723 National School Lunch Program* 10.555 150162990AF October 1, 2015 - September 30, 2016 604,389 National School Lunch Program* 10.555 150162990AF October 1, 2016 - September 30, 2017 3,590,809 National School Lunch Program* (Food Distrbution Program) 10.555 150162990AF June 1, 2016 - July 30, 2017 392,306 Summer Food Service Program For Children* 10.559 150162990AF October 1, 2015 - September 30, 2016 71,180 Summer Food Service Program For Children* 10.559 150162990AF October 1, 2016 - September 30, 2017 23,710 Total Child Nutrition Cluster 6,062,841
Child and Adult Care Food Program 10.558 150162990AF October 1, 2015 - September 30, 2016 25,493 Child and Adult Care Food Program 10.558 150162990AF October 1, 2016 - September 30, 2017 407,373 Total Child & Adult Care Food Program 432,866
Department of Defense: Pass-through program from the United States Navy: ROTC Language and Culture Training Grants 12.357 238,437
Total expenditures of federal awards $ 16,953,279
*Denotes a major program.
See notes to schedule of expenditures of federal awards. 39
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2017
1. Basis of presentation
The accompanying schedule of expenditures of federal awards (schedule) includes the federal grant activity of the School and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of the School, it is not intended to and does not present the financial position, changes in net assets or cash flows of the School.
2. Summary of significant accounting policies
Expenditures reported on the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited as to reimbursement.
3. Indirect cost rate
The School has elected to use the 10 percent de minimus indirect cost rate as allowed under the Uniform Guidance.
40
Independent Auditors’ Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards
Board of Directors Noble Network of Charter Schools
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, the consolidated financial statements of Noble Network of Charter Schools, Subsidiaries and Affiliate (collectively referred to as the School), which comprise the consolidated statement of financial position as of June 30, 2017, and the related consolidated statements of activities, functional expenses and cash flows for the year then ended, and the related notes to the consolidated financial statements, and have issued our report thereon dated October 17, 2017.
Internal Control Over Financial Reporting
In planning and performing our audit of the consolidated financial statements, we considered the School’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the consolidated financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School’s internal control. Accordingly, we do not express an opinion on the effectiveness of the School’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
41
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Our consideration of the internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the School’s consolidated financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Chicago, IL October 17, 2017
42
Independent Auditors’ Report on Compliance for Each Major Program and on Internal Control Over Compliance Required by the Uniform Guidance
Board of Directors Noble Network of Charter Schools
Report on Compliance for Each Major Federal Program
We have audited Noble Network of Charter Schools’ (the School) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of the School’s major federal programs for the year ended June 30, 2017. The School’s major federal programs are identified in the summary of auditors’ results section of the accompanying schedule of findings and questioned costs.
Management’s Responsibility
Management is responsible for compliance with federal statutes, regulations and the terms and conditions of its federal awards applicable to its federal programs.
Auditors’ Responsibility
Our responsibility is to express an opinion on compliance for each of the School’s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.
43
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We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School’s compliance.
Opinion on Each Major Federal Program
In our opinion, the School complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2017.
Report on Internal Control Over Compliance
Management of the School is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School’s internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
44
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
Chicago, IL October 17, 2017
45 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2017
Section I - Summary of Auditors’ Results
1. The auditors’ report expresses an unmodified opinion on the consolidated financial statements of Noble Network of Charter Schools, Subsidiaries and Affiliate.
2. There were no significant deficiencies or material weaknesses disclosed during the audit of the consolidated financial statements.
3. There were no instances of noncompliance material to the consolidated financial statements of Noble Network of Charter Schools, Subsidiaries and Affiliate, which would be required to be reported in accordance with Government Auditing Standards.
4. There were no significant deficiencies or material weaknesses in internal control over major federal award programs disclosed during the audit.
5. The auditors’ report on compliance for the major federal award programs for Noble Network of Charter Schools expresses an unmodified opinion on all major federal programs.
6. There were no audit findings that are required to be reported in accordance with the Uniform Guidance.
7. The programs tested as a major program were: U.S. Department of Education, Charter Schools (84.282) U.S. Department of Education, Supporting Effective Instruction State Grants (Title II) (84.367) U.S. Department of Agriculture, Child Nutrition Cluster Programs: School Breakfast Program (10.553) National School Lunch Program (10.555) Summer Food Service Program for Children (10.559)
8. The threshold used for distinguishing between Type A and B programs was $750,000.
9. Noble Network of Charter Schools qualified as a low-risk auditee.
Section II - Financial Statement Findings
There were no financial statement findings.
46 NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2017
Section III - Major Federal Award Programs Findings and Questioned Costs
There were no major federal award programs findings and questioned costs.
47
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2017
Financial Statement Findings
There were no financial statement findings.
Major Federal Award Programs Findings and Questioned Costs
There were no major federal award programs findings and questioned costs.
48
Independent Accountants’ Report on Compliance with Requirements of Applicable Laws and Regulations Prescribed by Administering Agency
Board of Directors Noble Network of Charter Schools
We have examined Noble Network of Charter Schools’ (the School) compliance with compliance requirements listed in Attachment A provided by its administering agency, the Chicago Public Schools, during the year ended June 30, 2017. Management of the School is responsible for the School’s compliance with the specified requirements. Our responsibility is to express an opinion on the School’s compliance with the specified requirements based on our examination.
Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Those standards require that we plan and perform the examination to obtain reasonable assurance about whether the School complied, in all material respects, with the specified requirements referenced above. An examination involves performing procedures to obtain evidence about whether the School complied with the specified requirements. The nature, timing, and extent of the procedures selected depend on our judgment, including an assessment of the risks of material noncompliance, whether due to fraud or error. We believe that the evidence we obtained is sufficient and appropriate to provide a reasonable basis for our opinion.
Our examination does not provide a legal determination on the School’s compliance with specified requirements.
In our opinion, the School complied in all material respects, with the specified requirements referred to in Attachment A during the year ended June 30, 2017.
This report is intended solely for the information and use of the Board of Directors and management of Noble Network of Charter Schools and Chicago Public Schools and is not intended to be, and should not be, used by anyone other than the specified parties.
Chicago, IL October 17, 2017
49
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Attachment A
Chicago Public Schools provided the specified requirements in a memorandum dated June 9, 2017 and a Charter School Agreement and Accountability Plan dated July 1, 2014.
Open Meetings Act (5 ILCS 120/1.01 et seq.) Fingerprint-based Criminal Background Investigations and Checks of the Statewide Sex Offender Database and Statewide Child Murderer and Violent Offender Against Youth Database (105 ILCS 5/10-21.9 and 105 ILCS 5/34-18.5) Illinois School Student Records Act (105 ILCS 10/1 et seq.) Administering Medication (105 ILCS 5/10-22.21b) Hazardous Materials Training (105 ILCS 5/10-20.17a) School Safety Drill Act (105 ILCS 128/1 et seq.) Abused and Neglected Child Reporting Act (325 ILCS 5/1 et seq.) Eye Protection in School Act (105 ILCS 115/0.01 et seq.) Toxic Art Supplies in Schools Act (105 ILCS 135/1 et seq.) Infectious Disease Policies and Rules (105 ILCS 5/10-21.11) Physical Fitness Facility Medical Emergency Preparedness Act (210 ILCS 74/1 et seq.) Conformance with the following sections of the Charter School Agreement: o Section 4: Enrollment o Section 4: Governance and Operation o Section 5: Maintenance of Corporate Status and Good Standing o Section 5: Facilities o Section 6: Pension Payments o Section 6: Management and Financial Controls o Section 6: Attendance o Section 8: Insurance
50
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
SUMMARY OF FINDINGS
YEAR ENDED JUNE 30, 2017
Current Prior year year finding finding
Noble Street College Prep None None Rauner College Prep None None Pritzker College Prep None None Rowe Clark College Prep None None Golder College Prep None None Gary Comer College Prep None 2016-1 UIC College Prep None None Muchin College Prep None None Chicago Bulls College Prep None None Johnson College Prep None None Hansberry College Prep None None DRW College Prep None None Baker College Prep None None Butler College Prep None 2016-1 ITW David Speer Academy None None The Noble Academy None None Mansueto High School None N/A
51
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
SCHEDULE OF CURRENT YEAR FINDINGS
YEAR ENDED JUNE 30, 2017
There are no findings for the year ended June 30, 2017.
52
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
SCHEDULE OF PRIOR YEAR FINDINGS
YEAR ENDED JUNE 30, 2017
Finding 2016-1 Fingerprint-based Criminal Background Investigations and Checks of the Statewide Sex Offender Database and Statewide Child Murderer and Violent Offender Against Youth Database
Criteria/Requirement
The School shall obtain authorization from every new applicant to conduct a criminal background investigation on them.
Condition
Of the 170 employee files we tested across all 16 Campuses, two criminal background authorization forms were unable to be located.
Recommendation
In the prior year, we recommended that the School obtain the necessary authorization that is required to be attained to conduct a criminal background investigation for every new applicant at the School.
Status
During the year ended June 30, 2017, the School corrected the instances of noncompliance and transitioned to an electronic system of human resources onboarding for new employees. The new system does not allow the onboarding process to proceed without a proper background investigation authorization. This is no longer a finding.
53
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF FINANCIAL POSITION
June 30, 2017 Noble Management, Noble Network Noble Network LLC - of Noble Education Mansueto High Consolidated Charter Schools Day Care Foundation School, LLC Eliminations Total
ASSETS
Current assets: Cash $ 50,840,637 $ 159,010 $ 647,659 $ 51,647,306 Accounts receivable 9,278,115 11,236 9,289,351 Contributions receivable 7,613,673 7,613,673 Due from Noble Day Care 262,505 $ (262,505) Due from Noble Network Education Foundation 380,900 (380,900) Prepaid expenses 1,996,940 1,996,940 Cash - restricted by NMTC 10,399,174 10,399,174 Cash and investments - restricted by bond indenture 12,403,186 12,403,186 Investments - restricted for lease security deposit 361,332 361,332 Leverage loan notes receivable - NMTC 9,187,788 9,187,788
Total current assets 93,536,462 170,246 9,835,447 (643,405) 102,898,750
Property and equipment, net 104,698,723 106,125 $ 3,686,675 108,491,523
Other assets: Contributions receivable, net of current portion 1,010,000 1,010,000 Investments - restricted for student scholarships 2,589,641 2,589,641 Investment - Noble Management, LLC 3,686,675 (3,686,675) Leverage loan notes receivable - NMTC, net of current portion 24,878,829 24,878,829 Deposits 793,576 6,500 800,076
Total other assets 8,079,892 6,500 24,878,829 (3,686,675) 29,278,546
Total assets $ 206,315,077 $ 282,871 $ 34,714,276 $ 3,686,675 $ (4,330,080) $ 240,668,819
54
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF FINANCIAL POSITION (CONTINUED)
June 30, 2017 Noble Management, Noble Network Noble Network LLC - of Noble Education Mansueto High Consolidated Charter Schools Day Care Foundation School, LLC Eliminations Total
LIABILITIES, NET ASSETS (DEFICIT) AND MEMBER’S EQUITY
Current liabilities: Accounts payable and accrued expenses $ 15,770,403 $ 15,770,403 Due to Noble Network of Charter Schools $ 262,505 $ 380,900 $ (643,405) Bonds payable, net 11,819,140 11,819,140 Notes payable, net 15,730,424 15,730,424 Deferred lease incentive, current portion 199,046 199,046 Deferred revenue 2,352,568 2,352,568
Total current liabilities 45,871,581 262,505 380,900 (643,405) 45,871,581
Long-term liabilities: Bonds payable, net, net of current portion 36,732,186 36,732,186 Notes payable, net, net of current portion 38,454,378 38,454,378 Obligation under interest rate swap agreement 37 37 Deferred lease incentive, net of current portion 2,123,154 2,123,154 Deferred rent 2,576,619 29,274 2,605,893
Total long-term liabilities 79,886,374 29,274 79,915,648
Total liabilities 125,757,955 291,779 380,900 (643,405) 125,787,229
Net assets (deficit): Unrestricted: Board-designated 15,000,000 15,000,000 Undesignated 53,444,188 (8,908) 1,409,976 32,923,400 87,768,656
Total unrestricted 68,444,188 (8,908) 1,409,976 32,923,400 102,768,656
Temporarily restricted 12,112,934 32,923,400 (32,923,400) 12,112,934
Total net assets (deficit) 80,557,122 (8,908) 34,333,376 114,881,590
Member’s equity $ 3,686,675 (3,686,675)
Total liabilities, net assets (deficit) and member’s equity $ 206,315,077 $ 282,871 $ 34,714,276 $ 3,686,675 $ (4,330,080) $ 240,668,819
55
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF FINANCIAL POSITION (CONTINUED)
June 30, 2016 Noble Management, Noble Network Noble Network LLC - of Noble Education Mansueto High Consolidated Charter Schools Day Care Foundation School, LLC Eliminations Total
ASSETS
Current assets: Cash $ 54,262,751 $ 167,832 $ 509,112 $ 54,939,695 Accounts receivable 8,837,518 6,727 8,844,245 Contributions receivable 11,546,418 11,546,418 Due from Noble Day Care 283,110 $ (283,110) Due from Noble Network Education Foundation 317,900 (317,900) Prepaid expenses 1,997,208 1,997,208 Cash and investments - restricted by bond indenture 11,771,600 11,771,600
Total current assets 89,016,505 174,559 509,112 (601,010) 89,099,166
Property and equipment, net 86,164,884 123,879 $ 3,686,675 89,975,438
Other assets: Contributions receivable, net of current portion 581,000 581,000 Cash - restricted by NMTC 2,604,562 2,604,562 Cash and investments - restricted by bond indenture, net of current portion 11,174,245 11,174,245 Investments - restricted for student scholarships 2,616,057 2,616,057 Investments - restricted for lease security deposit 360,268 360,268 Investments - Noble Management, LLC 3,686,675 (3,686,675) Leverage loan notes receivable - NMTC 14,808,362 14,808,362 Deposits 793,576 6,500 800,076
Total other assets 21,816,383 6,500 14,808,362 (3,686,675) 32,944,570
Total assets $ 196,997,772 $ 304,938 $ 15,317,474 $ 3,686,675 $ (4,287,685) $ 212,019,174
56
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF FINANCIAL POSITION (CONTINUED)
June 30, 2016 Noble Management, Noble Network Noble Network LLC - of Noble Education Mansueto High Consolidated Charter Schools Day Care Foundation School, LLC Eliminations Total
LIABILITIES, NET ASSETS (DEFICIT) AND MEMBER’S EQUITY
Current liabilities: Accounts payable and accrued expenses $ 10,739,890 $ 10,739,890 Due to Noble Network of Charter Schools $ 283,110 $ 317,900 $ (601,010) Bonds payable, net 10,310,390 10,310,390 Notes payable, net 1,287,615 1,287,615 Deferred lease incentive, current portion 199,046 199,046 Deferred revenue 1,957,314 1,957,314
Total current liabilities 24,494,255 283,110 317,900 (601,010) 24,494,255
Long-term liabilities: Bonds payable, net, net of current portion 48,551,330 48,551,330 Notes payable, net, net of current portion 28,633,993 28,633,993 Obligation under interest rate swap agreement 116,247 116,247 Deferred lease incentive, net of current portion 2,322,199 2,322,199 Deferred rent 2,386,844 27,985 2,414,829
Total long-term liabilities 82,010,613 27,985 82,038,598
Total liabilities 106,504,868 311,095 317,900 (601,010) 106,532,853
Net assets (deficit): Unrestricted: Board-designated 15,000,000 15,000,000 Other 58,842,184 (6,157) 1,080,374 13,919,200 73,835,601
Total unrestricted 73,842,184 (6,157) 1,080,374 13,919,200 88,835,601
Temporarily restricted 16,650,720 13,919,200 (13,919,200) 16,650,720
Total net assets (deficit) 90,492,904 (6,157) 14,999,574 105,486,321
Member’s equity $ 3,686,675 (3,686,675)
Total liabilities, net assets (deficit) and member’s equity $ 196,997,772 $ 304,938 $ 15,317,474 $ 3,686,675 $ (4,287,685) $ 212,019,174
57
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF ACTIVITIES
Year ended June 30, 2017 Noble Network Support Team Noble Street College Prep Rauner College Prep Pritzker College Prep Temporarily Temporarily Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total
Revenue: Chicago Public Schools: Per-capita tuition $ 4,935,427 $ 4,935,427 $ 4,926,454 $ 4,926,454 $ 7,772,579 $ 7,772,579 Facilities 473,628 473,628 475,502 475,502 744,377 744,377 Special education $ 993,680 $ 993,680 689,702 689,702 572,799 572,799 830,623 830,623 Case manager stipends 1,567 1,567 1,567 1,567 1,567 1,567 Chapter I 479,085 479,085 457,691 457,691 781,136 781,136 Title I 438,896 438,896 455,788 455,788 695,976 695,976 Title II 55,405 55,405 55,045 55,045 85,946 85,946 Title III 4,712 4,712 416 416 46 46 English Language Learners 8,000 8,000 18,017 18,017 32,147 32,147 Growth funds Contributed services 50,773 50,773 53,461 53,461 43,752 43,752 54,291 54,291 Contributions and grants 2,640,522 $ 4,563,213 7,203,735 4,514 4,514 15 $ 42,657 42,672 4,744 $ 629,456 634,200 Contributed services, other than CPS 1,015,300 1,015,300 E-rate discount funding 83,495 83,495 84,530 84,530 118,432 118,432 Food program 3,141 3,141 269,605 269,605 257,737 257,737 640,940 640,940 Instructional program - ROTC 47,422 47,422 34,175 34,175 Interest and dividends 167,101 167,101 21 21 26 26 27 27 Change in fair value of interest rate swap Net realized and unrealized loss on investments (134,626) (134,626) Night school fees 15,745 15,745 11,060 11,060 17,667 17,667 Other revenue 164,866 164,866 645 645 748 748 Registration and tuition - Noble Day Care School fees 218,083 218,083 177,113 177,113 356,414 356,414 School fundraising 11,950 11,950 Summer of a Lifetime, A Noble Network Program 729,831 518,996 1,248,827 Summer of a Lifetime, A Noble Network Program - transfers 322,000 322,000 (20,000) (20,000) (15,000) (15,000) (15,000) (15,000) Summer school fees 29,460 29,460 26,595 26,595 38,515 38,515 Uniform fees 37,971 37,971 23,441 23,441 45,919 45,919 Transfer of grant funds from NNST (1,347,520) (1,347,520) 70,428 70,428 71,000 71,000 112,799 112,799 NNST school management fees (expenses) 12,374,043 12,374,043 (654,593) (654,593) (657,185) (657,185) (1,028,795) (1,028,795) Net assets released from restrictions: Satisfaction of purpose or time restrictions 4,116,817 (4,116,817) 5,000 $ (5,000) 31,830 (31,830) 67,804 (67,804)
Total revenue 21,143,350 965,392 22,108,742 7,212,207 (5,000) 7,207,207 7,018,193 10,827 7,029,020 11,393,077 561,652 11,954,729
Expenses: Program services 2,798,921 2,798,921 6,846,843 6,846,843 6,738,732 6,738,732 10,240,642 10,240,642 Supporting services: Management and general 14,191,380 14,191,380 Fundraising 2,101,628 2,101,628
Total expenses 19,091,929 19,091,929 6,846,843 6,846,843 6,738,732 6,738,732 10,240,642 10,240,642
Change in net assets $ 2,051,421 $ 965,392 $ 3,016,813 $ 365,364 $ (5,000) $ 360,364 $ 279,461 $ 10,827 $ 290,288 $ 1,152,435 $ 561,652 $ 1,714,087
Rowe Clark College Prep Golder College Prep Gary Comer College Prep UIC College Prep Muchin College Prep Chicago Bulls College Prep Temporarily Temporarily Temporarily Temporarily Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total
$ 4,176,644 $ 4,176,644 $ 5,078,173 $ 5,078,173 $ 8,767,089 $ 8,767,089 $ 7,023,711 $ 7,023,711 $ 7,354,831 $ 7,354,831 $ 8,752,691 $ 8,752,691 403,877 403,877 487,877 487,877 604,877 604,877 704,250 704,250 1,024,951 1,024,951 592,941 592,941 1,326,225 1,326,225 870,939 870,939 673,432 673,432 997,529 997,529 1,567 1,567 1,568 1,568 1,568 1,568 1,568 1,568 1,568 1,568 1,568 1,568 440,071 440,071 503,837 503,837 831,898 831,898 654,863 654,863 689,263 689,263 862,523 862,523 400,743 400,743 484,294 484,294 780,592 780,592 636,606 636,606 666,117 666,117 821,160 821,160 47,117 47,117 61,081 61,081 99,099 99,099 82,162 82,162 83,333 83,333 93,532 93,532 178 178 3,976 3,976 7,058 7,058 12,011 12,011 19,972 19,972 11,857 11,857 43,579 43,579
77,475 77,475 47,033 47,033 272,894 272,894 672,628 672,628 48,507 48,507 937,086 937,086 8,798 $ 206,272 215,070 15 $ 18,000 18,015 655 $ 60,000 60,655 $ 50,000 50,000 5,434 $ 50,000 55,434 8,887 $ (12,000) (3,113)
75,611 75,611 90,538 90,538 146,594 146,594 117,416 117,416 117,430 117,430 128,245 128,245 331,066 331,066 296,426 296,426 500,412 500,412 484,296 484,296 602,263 602,263 621,484 621,484 2,994 2,994 48,877 48,877 38,869 38,869 35 35 47 47
8,930 8,930 10,755 10,755 20,911 20,911 23,060 23,060 5,668 5,668 16,680 16,680 6,581 6,581 14,203 14,203 40,060 40,060 4,889 4,889 3,254 3,254 14,972 14,972
111,381 111,381 199,588 199,588 297,504 297,504 242,819 242,819 274,585 274,585 408,950 408,950 1,500 1,500 3,324 3,324 13,658 13,658 5,996 5,996 3,725 3,725
(15,000) (15,000) (10,000) (10,000) (30,000) (30,000) (25,000) (25,000) (50,000) (50,000) (25,000) (25,000) 35,867 35,867 19,315 19,315 26,884 26,884 27,870 27,870 11,428 11,428 21,400 21,400 25,042 25,042 39,920 39,920 59,543 59,543 40,353 40,353 63,606 63,606 41,214 41,214 61,839 61,839 74,436 74,436 124,823 124,823 99,630 99,630 101,920 101,920 123,106 123,106 (557,156) (557,156) (674,288) (674,288) (1,170,805) (1,170,805) (931,357) (931,357) (973,338) (973,338) (1,164,067) (1,164,067)
423,443 (423,443) 15,169 (15,169) 30,000 (30,000) 54,000 (54,000) 51,250 (51,250) 3,000 (3,000)
7,104,065 (217,171) 6,886,894 7,358,376 2,831 7,361,207 12,734,147 30,000 12,764,147 10,142,988 (4,000) 10,138,988 10,459,712 (1,250) 10,458,462 12,751,133 (15,000) 12,736,133
7,008,998 7,008,998 7,187,380 7,187,380 12,338,650 12,338,650 9,211,329 9,211,329 10,148,027 10,148,027 11,899,649 11,899,649
7,008,998 7,008,998 7,187,380 7,187,380 12,338,650 12,338,650 9,211,329 9,211,329 10,148,027 10,148,027 11,899,649 11,899,649
$ 95,067 $ (217,171) $ (122,104) $ 170,996 $ 2,831 $ 173,827 $ 395,497 $ 30,000 $ 425,497 $ 931,659 $ (4,000) $ 927,659 $ 311,685 $ (1,250) $ 310,435 $ 851,484 $ (15,000) $ 836,484
58
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF ACTIVITIES (CONTINUED)
Year ended June 30, 2017 Johnson College Prep Hansberry College Prep DRW College Prep Baker College Prep Butler College Prep Temporarily Temporarily Temporarily Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total
Revenue: Chicago Public Schools: Per-capita tuition $ 6,612,026 $ 6,612,026 $ 5,441,941 $ 5,441,941 $ 4,120,352 $ 4,120,352 $ 2,963,760 $ 2,963,760 $ 4,379,644 $ 4,379,644 Facilities 526,875 526,875 400,875 400,875 Special education 1,341,670 1,341,670 925,117 925,117 894,477 894,477 763,747 763,747 862,553 862,553 Case manager stipends 1,568 1,568 1,568 1,568 1,568 1,568 1,568 1,568 1,568 1,568 Chapter I 684,648 684,648 513,486 513,486 433,779 433,779 311,107 311,107 483,874 483,874 Title I 636,080 636,080 527,716 527,716 385,584 385,584 283,494 283,494 416,961 416,961 Title II 76,767 76,767 67,658 67,658 51,171 51,171 45,766 45,766 52,522 52,522 Title III English Language Learners Growth funds $ 167,475 167,475 Contributed services 563,306 563,306 66,996 66,996 57,204 57,204 648,865 648,865 485,032 485,032 Contributions and grants 15,600 $ 15,000 30,600 2,000 $ 25,000 27,000 $ 35,000 35,000 22,770 $ 200,000 222,770 1,185 172,780 173,965 Contributed services, other than CPS E-rate discount funding 117,538 117,538 97,237 97,237 92,634 92,634 64,046 64,046 67,452 67,452 Food program 580,946 580,946 387,221 387,221 350,318 350,318 175,375 175,375 269,923 269,923 Instructional program - ROTC 31,367 31,367 Interest and dividends 32 32 Change in fair value of interest rate swap Net realized and unrealized loss on investments Night school fees 4,225 4,225 33,135 33,135 (330) (330) 10,735 10,735 8,975 8,975 Other revenue 1,040 1,040 10,259 10,259 25,541 25,541 50 50 700 700 Registration and tuition - Noble Day Care School fees 107,323 107,323 193,664 193,664 54,162 54,162 47,056 47,056 82,795 82,795 School fundraising 448 448 25,195 25,195 Summer of a Lifetime, A Noble Network Program Summer of a Lifetime, A Noble Network Program - transfers (22,000) (22,000) (25,000) (25,000) (15,000) (15,000) (15,000) (15,000) (20,000) (20,000) Summer school fees 29,285 29,285 26,355 26,355 19,698 19,698 14,110 14,110 14,995 14,995 Uniform fees 17,402 17,402 35,469 35,469 22,402 22,402 34,498 34,498 21,169 21,169 Transfer of grant funds from NNST 97,339 97,339 80,162 80,162 60,694 60,694 48,670 48,670 60,694 60,694 NNST school management fees (expenses) (888,340) (888,340) (728,190) (728,190) (553,010) (553,010) (403,744) (403,744) (598,619) (598,619) Net assets released from restrictions: Satisfaction of purpose or time restrictions 15,000 (15,000) 23,564 (23,564) 39,236 (39,236) 57,500 (57,500) 340,255 (340,255)
Total revenue 10,022,790 10,022,790 8,207,265 1,436 8,208,701 6,441,355 (4,236) 6,437,119 5,074,821 142,500 5,217,321 6,956,873 6,956,873
Expenses: Program services 9,062,566 9,062,566 9,026,706 9,026,706 6,595,709 6,595,709 5,411,536 5,411,536 6,620,278 6,620,278 Supporting services: Management and general Fundraising
Total expenses 9,062,566 9,062,566 9,026,706 9,026,706 6,595,709 6,595,709 5,411,536 5,411,536 6,620,278 6,620,278
Change in net assets $ 960,224 $ - $ 960,224 $ (819,441) $ 1,436 $ (818,005) $ (154,354) $ (4,236) $ (158,590) $ (336,715) $ 142,500 $ (194,215) $ 336,595 $ - $ 336,595
ITW David Speer Academy The Noble Academy Mansueto High School Noble Day Care Noble Network Education Foundation Temporarily Temporarily Temporarily Temporarily Temporarily Consolidated Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Total Unrestricted Restricted Total Unrestricted Restricted Total Eliminations Total
$ 6,335,814 $ 6,335,814 $ 2,706,536 $ 2,706,536 $ 1,402,074 $ 1,402,074 $ 92,749,746 $ 92,749,746 611,627 611,627 134,625 134,625 5,568,390 5,568,390 861,680 861,680 304,120 304,120 220,908 220,908 14,747,093 14,747,093 1,568 1,568 1,568 1,568 1,568 1,568 26,652 26,652 610,814 610,814 248,353 248,353 125,855 125,855 9,112,283 9,112,283 552,271 552,271 230,422 230,422 10,392 10,392 8,423,092 8,423,092 84,414 84,414 30,631 30,631 22,523 22,523 1,094,172 1,094,172 4,858 4,858 884 884 22,128 22,128 35,000 35,000 180,583 180,583 $ 137,025 137,025 $ 102,516 102,516 407,016 407,016 56,192 56,192 357,431 357,431 21,244 21,244 4,514,170 4,514,170 119,098 31,000 150,098 120,207 120,207 $ 568,289 568,289 9,609,111 $ 19,004,200 $ 19,004,200 $ (19,004,200) 9,609,111 1,015,300 1,015,300 109,418 109,418 62,997 62,997 41,641 41,641 1,615,254 1,615,254 491,497 491,497 168,568 168,568 119,396 119,396 6,550,614 6,550,614 34,732 34,732 238,436 238,436 15,267 15,267 182,556 $ 392,748 392,748 575,304 116,210 116,210 116,210 116,210 (134,626) (134,626) 6,850 6,850 3,665 3,665 2,870 2,870 200,601 200,601 5,578 5,578 25 25 1,311 1,311 294,722 (63,000) 231,722 $ 762,152 $ 762,152 762,152 166,668 166,668 98,079 98,079 46,290 46,290 3,082,474 3,082,474 9,991 9,991 305 305 1,953 1,953 78,045 78,045 1,248,827 1,248,827 (15,000) (15,000) (5,000) (5,000) 17,385 17,385 12,858 12,858 6,000 6,000 378,020 378,020 19,864 19,864 16,141 16,141 23,509 23,509 567,463 567,463 91,613 91,613 40,883 40,883 27,484 27,484 (845,322) (845,322) (359,171) (359,171) (186,063) (186,063)
168,025 (168,025) 197,923 (197,923) 6,598,856 (6,598,856)
9,650,845 9,650,845 4,117,218 24,800 4,142,018 8,637,703 (6,030,567) 2,607,136 161,888,332 762,152 762,152 392,748 19,004,200 19,396,948 (19,067,200) 162,980,232
9,239,193 9,239,193 3,858,019 3,858,019 21,297,928 21,297,928 155,531,106 664,608 664,608 (19,004,200) 137,191,514
14,191,380 100,295 100,295 63,146 63,146 (63,000) 14,291,821 2,101,628 2,101,628
9,239,193 9,239,193 3,858,019 3,858,019 21,297,928 21,297,928 171,824,114 764,903 764,903 63,146 63,146 (19,067,200) 153,584,963
$ 411,652 $ - $ 411,652 $ 259,199 $ 24,800 $ 283,999 $ (12,660,225) $ (6,030,567) $ (18,690,792) $ (9,935,782) $ (2,751) $ (2,751) $ 329,602 $ 19,004,200 $ 19,333,802 $ - $ 9,395,269
59
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF ACTIVITIES (CONTINUED)
Year ended June 30, 2016 Noble Network Support Team Noble Street College Prep Rauner College Prep Pritzker College Prep Temporarily Temporarily Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total
Revenue: Chicago Public Schools: Per-capita tuition $ 5,253,466 $ 5,253,466 $ 5,126,816 $ 5,126,816 $ 7,854,888 $ 7,854,888 Facilities 469,500 469,500 459,750 459,750 700,125 700,125 Special education $ 767,444 $ 767,444 675,543 675,543 588,804 588,804 821,437 821,437 Case manager stipends 3,014 3,014 3,014 3,014 3,014 3,014 Chapter I 461,903 461,903 432,386 432,386 707,613 707,613 Title I 535,636 535,636 447,095 447,095 666,851 666,851 Title II 55,694 55,694 56,432 56,432 84,984 84,984 Title III 13,246 13,246 3,150 3,150 43,203 43,203 Growth funds Contributed services 40,553 40,553 74,829 74,829 71,555 71,555 91,545 91,545 Contributions and grants 941,737 $ 1,394,816 2,336,553 9,904 9,904 2,000 2,000 6,125 $ 36,000 42,125 E-rate discount funding 24,789 24,789 24,275 24,275 36,946 36,946 Food program 7,988 7,988 284,060 284,060 215,040 215,040 571,668 571,668 Instructional program - ROTC 110,723 110,723 33,539 33,539 Interest and dividends 208,206 208,206 5 5 9 9 9 9 Change in value of interest rate swap Net realized and unrealized loss on investments (23,677) (23,677) Night school fees 9,375 9,375 16,626 16,626 15,710 15,710 Other revenue 158,081 158,081 2,822 2,822 968 968 860 860 Registration and tuition - Noble Day Care School fees 220,947 220,947 166,367 166,367 364,792 364,792 School fundraising 13,053 13,053 Summer of a Lifetime, A Noble Network Program 752,364 580,822 1,333,186 Summer of a Lifetime, A Noble Network Program - transfers 345,850 345,850 (16,000) (16,000) (15,000) (15,000) (15,000) (15,000) Summer school fees 22,695 22,695 26,368 26,368 41,180 41,180 Uniform fees 34,755 34,755 28,974 28,974 58,068 58,068 Transfer of grant funds from NNST (3,177,697) (3,177,697) 176,429 176,429 172,765 172,765 262,953 262,953 NNST school management fees (expenses) 12,658,636 12,658,636 (702,821) (702,821) (688,226) (688,226) (1,048,056) (1,048,056) Net assets released from restrictions: Satisfaction of purpose or time restrictions 4,562,616 (4,562,616) 28,858 (28,858)
Total revenue 17,352,824 (2,586,978) 14,765,846 7,622,844 7,622,844 7,139,168 7,139,168 11,331,312 7,142 11,338,454
Expenses: Program services 1,780,051 1,780,051 6,863,299 6,863,299 6,873,136 6,873,136 9,787,090 9,787,090 Supporting services: Management and general 13,236,430 13,236,430 Fundraising 877,908 877,908
Total expenses 15,894,389 15,894,389 6,863,299 6,863,299 6,873,136 6,873,136 9,787,090 9,787,090
Change in net assets $ 1,458,435 $ (2,586,978) $ (1,128,543) $ 759,545 $ 759,545 $ 266,032 $ 266,032 $ 1,544,222 $ 7,142 $ 1,551,364
Rowe Clark College Prep Golder College Prep Gary Comer College Prep UIC College Prep Muchin College Prep Chicago Bulls College Prep Temporarily Temporarily Temporarily Temporarily Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total
$ 4,598,273 $ 4,598,273 $ 5,480,972 $ 5,480,972 $ 8,842,246 $ 8,842,246 $ 7,463,369 $ 7,463,369 $ 7,411,935 $ 7,411,935 $ 9,242,203 $ 9,242,203 413,250 413,250 487,500 487,500 558,750 558,750 659,250 659,250 926,050 926,050 612,110 612,110 1,199,281 1,199,281 903,520 903,520 686,661 686,661 959,336 959,336 3,014 3,014 3,014 3,014 3,014 3,014 3,014 3,014 3,014 3,014 3,013 3,013 418,026 418,026 495,409 495,409 765,850 765,850 636,612 636,612 608,691 608,691 828,873 828,873 469,886 469,886 500,393 500,393 792,052 792,052 649,148 649,148 606,554 606,554 956,592 956,592 55,099 55,099 57,382 57,382 95,643 95,643 77,736 77,736 79,073 79,073 92,638 92,638 4,061 4,061 20,871 20,871 9,600 9,600
97,460 97,460 80,782 80,782 331,267 331,267 681,794 681,794 70,972 70,972 943,304 943,304 31,869 $ 360,000 391,869 1,416 $ 18,000 19,416 12,400 $ 271,389 283,789 500 $ 45,000 45,500 5,868 $ 120,000 125,868 8,498 8,498 21,819 21,819 25,898 25,898 41,976 41,976 35,244 35,244 34,768 34,768 43,718 43,718 310,292 310,292 274,090 274,090 534,661 534,661 460,413 460,413 496,013 496,013 590,216 590,216 37,002 37,002 2,613 2,613 47,843 47,843 39,733 39,733 10 10 13 13
17,641 17,641 8,405 8,405 27,435 27,435 20,793 20,793 5,890 5,890 16,880 16,880 17,190 17,190 10,374 10,374 31,679 31,679 1,100 1,100 8,597 8,597
114,288 114,288 195,999 195,999 267,181 267,181 289,683 289,683 234,326 234,326 365,768 365,768 889 889 20,301 20,301 2,103 2,103 1,927 1,927
(13,000) (13,000) (14,000) (14,000) (30,000) (30,000) (18,000) (18,000) (50,000) (50,000) (21,000) (21,000) 10,570 10,570 18,280 18,280 3,694 3,694 20,038 20,038 24,250 24,250 40,105 40,105 32,356 32,356 41,576 41,576 73,501 73,501 46,037 46,037 67,232 67,232 99,000 99,000 155,291 155,291 184,320 184,320 298,746 298,746 250,834 250,834 247,452 247,452 311,147 311,147 (618,617) (618,617) (734,818) (734,818) (1,190,642) (1,190,642) (998,657) (998,657) (986,307) (986,307) (1,239,480) (1,239,480)
646,319 (646,319) 14,103 (14,103) 271,389 (271,389) 49,250 (49,250) 53,276 (53,276)
7,748,149 (286,319) 7,461,830 7,766,702 3,897 7,770,599 12,931,012 12,931,012 10,639,472 (4,250) 10,635,222 10,271,721 66,724 10,338,445 13,291,068 13,291,068
7,773,268 7,773,268 7,525,453 7,525,453 12,370,153 12,370,153 9,328,172 9,328,172 10,477,001 10,477,001 11,222,632 11,222,632
7,773,268 7,773,268 7,525,453 7,525,453 12,370,153 12,370,153 9,328,172 9,328,172 10,477,001 10,477,001 11,222,632 11,222,632
$ (25,119) $ (286,319) $ (311,438) $ 241,249 $ 3,897 $ 245,146 $ 560,859 $ - $ 560,859 $ 1,311,300 $ (4,250) $ 1,307,050 $ (205,280) $ 66,724 $ (138,556) $ 2,068,436 $ 2,068,436
60
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF ACTIVITIES (CONTINUED)
Year ended June 30, 2016 Johnson College Prep Hansberry College Prep DRW College Prep Baker College Prep Butler College Prep Temporarily Temporarily Temporarily Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total
Revenue: Chicago Public Schools: Per-capita tuition $ 7,014,055 $ 7,014,055 $ 6,265,127 $ 6,265,127 $ 5,057,846 $ 5,057,846 $ 3,176,834 $ 3,176,834 $ 3,647,362 $ 3,647,362 Facilities 565,500 565,500 456,750 456,750 Special education 1,209,047 1,209,047 923,356 923,356 790,819 790,819 771,808 771,808 504,382 504,382 Case manager stipends 3,014 3,014 3,013 3,013 3,013 3,013 3,013 3,013 3,013 3,013 Chapter I 658,950 658,950 537,690 537,690 476,263 476,263 321,497 321,497 326,284 326,284 Title I 699,030 699,030 477,211 477,211 394,089 394,089 216,677 216,677 215,897 215,897 Title II 72,224 72,224 73,400 73,400 59,308 59,308 36,785 36,785 41,088 41,088 Title III 2,473 2,473 Growth funds $ 123,830 123,830 $ 89,400 89,400 $ 152,250 152,250 $ 186,760 186,760 Contributed services 570,238 570,238 96,573 96,573 82,914 82,914 655,158 655,158 482,499 482,499 Contributions and grants 59,919 $ 57,498 117,417 14,200 22,000 36,200 5,733 73,418 79,151 54,550 54,550 96,211 96,211 E-rate discount funding 33,343 33,343 29,858 29,858 24,116 24,116 15,523 15,523 17,463 17,463 Food program 505,265 505,265 420,413 420,413 274,368 274,368 170,649 170,649 213,567 213,567 Instructional program - ROTC 42,161 42,161 Interest and dividends 80 80 Change in value of interest rate swap Net realized and unrealized loss on investments Night school fees 4,740 4,740 19,850 19,850 17,330 17,330 11,282 11,282 10,675 10,675 Other revenue 4,907 4,907 5,375 5,375 19,177 19,177 2,753 2,753 Registration and tuition - Noble Day Care School fees 98,034 98,034 209,493 209,493 79,464 79,464 51,057 51,057 75,646 75,646 School fundraising 600 600 2,027 2,027 18,632 18,632 Summer of a Lifetime, A Noble Network Program Summer of a Lifetime, A Noble Network Program - transfers (15,000) (15,000) (22,000) (22,000) (12,000) (12,000) (20,000) (20,000) Summer school fees 22,235 22,235 34,446 34,446 15,275 15,275 4,460 4,460 4,120 4,120 Uniform fees 18,481 18,481 33,466 33,466 25,660 25,660 32,070 32,070 28,827 28,827 Transfer of grant funds from NNST 237,306 237,306 212,504 212,504 171,638 171,638 110,480 110,480 124,290 124,290 NNST school management fees (expenses) (945,328) (945,328) (846,529) (846,529) (683,735) (683,735) (439,544) (439,544) (494,557) (494,557) Net assets released from restrictions: Satisfaction of purpose or time restrictions 57,498 (57,498) 145,830 (145,830) 150,536 (150,536) 152,250 (152,250) 282,971 (282,971)
Total revenue 10,353,192 10,353,192 9,198,856 9,198,856 7,408,564 12,282 7,420,846 5,349,329 5,349,329 5,482,159 5,482,159
Expenses: Program services 9,075,134 9,075,134 9,554,450 9,554,450 7,296,712 7,296,712 5,262,154 5,262,154 5,940,093 5,940,093 Supporting services: Management and general Fundraising
Total expenses 9,075,134 9,075,134 9,554,450 9,554,450 7,296,712 7,296,712 5,262,154 5,262,154 5,940,093 5,940,093
Change in net assets $ 1,278,058 $ - $ 1,278,058 $ (355,594) $ - $ (355,594) $ 111,852 $ 12,282 $ 124,134 $ 87,175 $ - $ 87,175 $ (457,934) $ - $ (457,934)
ITW David Speer Academy The Noble Academy Mansueto High School Noble Day Care Noble Network Education Foundation Temporarily Temporarily Temporarily Temporarily Temporarily Consolidated Unrestricted Restricted Total Unrestricted Restricted Total Unrestricted Restricted Total Total Unrestricted Restricted Total Unrestricted Restricted Total Eliminations Total
$ 5,685,648 $ 5,685,648 $ 2,078,345 $ 2,078,345 $ 94,199,385 $ 94,199,385 510,750 510,750 5,281,125 5,281,125 764,797 764,797 167,753 167,753 13,272,148 13,272,148 3,013 3,013 3,013 3,013 48,217 48,217 524,926 524,926 166,732 166,732 8,367,705 8,367,705 237,238 237,238 153,745 153,745 8,018,094 8,018,094 55,238 55,238 39,623 39,623 1,032,347 1,032,347 15,760 15,760 112,364 112,364 $ 402,955 402,955 $ 51,765 51,765 1,006,960 1,006,960 86,041 86,041 361,464 361,464 4,818,948 4,818,948 88,196 15,000 103,196 10,000 204,084 214,084 $ 17,531,519 $ 17,531,519 21,497,850 21,497,850 26,967 26,967 9,781 9,781 446,484 446,484 326,062 326,062 113,629 113,629 5,768,394 5,768,394 30,558 30,558 344,172 344,172 208,332 $ 330,853 $ 330,853 539,185 (116,247) (116,247) (116,247) (116,247) (23,677) (23,677) 11,150 11,150 2,820 2,820 216,602 216,602 19,900 19,900 283,783 $ (63,000) 220,783 $ 698,133 $ 698,133 698,133 122,329 122,329 58,048 58,048 2,913,422 2,913,422 6,925 6,925 75 75 66,532 66,532 1,333,186 1,333,186 (69,850) (69,850) (15,000) (15,000) 13,265 13,265 9,065 9,065 310,046 310,046 33,287 33,287 14,391 14,391 667,681 667,681 191,930 191,930 69,612 69,612 (764,570) (764,570) (276,749) (276,749)
467,955 (467,955) 255,849 (255,849) $ 5,515,714 (5,515,714)
8,271,268 (50,000) 8,221,268 3,222,196 3,222,196 5,515,714 12,015,805 17,531,519 170,073,853 698,133 698,133 330,853 330,853 (63,000) 171,039,839
7,968,330 7,968,330 5,566,372 5,566,372 121,443 121,443 134,784,943 624,528 624,528 135,409,471
13,236,430 90,551 90,551 63,214 63,214 (63,000) 13,327,195 877,908 877,908
7,968,330 7,968,330 5,566,372 5,566,372 121,443 121,443 148,899,281 715,079 715,079 63,214 63,214 (63,000) 149,614,574
$ 302,938 $ (50,000) $ 252,938 $ (2,344,176) $ - $ (2,344,176) $ 5,394,271 $ 12,015,805 $ 17,410,076 $ 21,174,572 $ (16,946) $ (16,946) $ 267,639 $ 267,639 $ - $ 21,425,265
61
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF FUNCTIONAL EXPENSES
Year ended June 30, 2017 Noble Network Education Noble Network Charter of Charter Schools Noble Day Care Foundation Supporting Supporting Supporting Services Services Services Program Management Program Management Management Consolidated services and general Fundraising Total services and general Total and general Eliminations Total
Building maintenance and repairs $ 1,710,305 $ 11,562 $ 1,721,867 $ 19,291 $ 19,291 $ 1,741,158 Bonus salaries 5,625,973 657,282 $ 31,270 6,314,525 6,314,525 Charitable contributions 19,004,200 19,004,200 $ (19,004,200) Classroom furniture 458,151 458,151 458,151 Contracted maintenance services 2,274,529 1,011 2,275,540 37,149 37,149 2,312,689 Contractual services and stipends 1,648,157 1,680,870 1,415,297 4,744,324 $ 63,000 (63,000) 4,744,324 CPS administrative fee 3,011,448 3,011,448 3,011,448 CPS facility fee 1,169,013 1,169,013 1,169,013 Depreciation and amortization 4,915,330 96,255 5,011,585 15,980 $ 1,775 17,755 5,029,340 Educational materials 2,065,682 66,838 2,132,520 8,522 8,522 2,141,042 Employee benefits and payroll taxes 16,864,992 1,511,983 70,767 18,447,742 93,737 18,493 112,230 18,559,972 Extracurricular activities 1,007,511 1,007,511 1,007,511 Field studies 1,303,510 24,491 1,328,001 1,328,001 Food program 6,383,524 86 6,383,610 21,710 21,710 6,405,320 Fundraising events 27,380 27,380 27,380 Graduation 305,707 305,707 305,707 Insurance 684,080 684,080 1,859 1,859 685,939 Interest 3,247,760 228,874 3,476,634 3,476,634 Music program 232,208 232,208 232,208 Night school 192,563 192,563 192,563 Office furniture 48,116 8,058 56,174 56,174 Other expenses 394,125 479,983 89,827 963,935 8,249 8,249 146 972,330 Payroll processing fees 202,051 202,051 202,051 Postage and delivery 65,051 72,276 148 137,475 137,475 Printing and copying 1,028,520 96,684 2,523 1,127,727 1,127,727 Professional development 891,064 506,355 31,434 1,428,853 3,390 3,390 1,432,243 Rent 7,243,278 358,034 7,601,312 72,024 8,003 80,027 7,681,339 Salaries 60,841,238 7,746,256 329,398 68,916,892 368,800 72,024 440,824 69,357,716 Scholarships 1,910,493 1,910,493 1,910,493
62
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF FUNCTIONAL EXPENSES (CONTINUED)
Year ended June 30, 2017 Noble Network Education Noble Network Charter of Charter Schools Noble Day Care Foundation Supporting Supporting Supporting Services Services Services Program Management Program Management Management Consolidated services and general Fundraising Total services and general Total and general Eliminations Total
Sports activities $ 1,304,625 $ 33,124 $ 1,337,749 $ 1,337,749 Staff advertising and recruitment 56,444 137,938 $ 200 194,582 194,582 Summer of a Lifetime, A Noble Network Program 1,269,746 138,532 80,941 1,489,219 1,489,219 Summer school 388,655 388,655 388,655 Supplies 464,702 44,856 15 509,573 $ 2,379 $ 2,379 511,952 Technology 4,295,416 85,065 22,428 4,402,909 4,402,909 Transportation 932,040 2,900 934,940 934,940 Uniforms 919,335 919,335 919,335 Utilities 1,373,615 16 1,373,631 11,518 11,518 1,385,149
Total expenses $ 155,531,106 $ 14,191,380 $ 2,101,628 $ 171,824,114 $ 664,608 $ 100,295 $ 764,903 $ 63,146 $ (19,067,200) $ 153,584,963
63
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF FUNCTIONAL EXPENSES (CONTINUED)
Year ended June 30, 2016 Noble Network Education Noble Network Charter of Charter Schools Noble Day Care Foundation Supporting Supporting Supporting Services Services Services Program Management Program Management Management Consolidated services and general Fundraising Total services and general Total and general Eliminations Total
Building maintenance and repairs $ 1,335,917 $ 68,267 $ 1,404,184 $ 11,895 $ 11,895 $ 1,416,079 Bonus salaries 6,711,238 611,698 $ 52,400 7,375,336 7,375,336 Classroom furniture 677,365 677,365 677,365 Contracted maintenance services 2,232,621 14,248 2,246,869 28,070 28,070 2,274,939 Contractual services and stipends 1,109,530 1,350,315 125,960 2,585,805 $ 63,000 $ (63,000) 2,585,805 Contributed services 427,520 427,520 427,520 CPS administrative fee 3,479,177 3,479,177 3,479,177 CPS facility fee 983,208 983,208 983,208 Depreciation and amortization 4,448,481 96,864 4,545,345 15,980 $ 1,775 17,755 4,563,100 Educational materials 2,536,327 104,907 2,641,234 7,656 7,656 2,648,890 Employee benefits and payroll taxes 14,918,077 1,250,919 58,945 16,227,941 77,684 14,347 92,031 16,319,972 Extracurricular activities 1,547,034 1,547,034 1,547,034 Field studies 1,336,656 10,145 1,346,801 1,346,801 Food program 5,706,361 2,943 5,709,304 21,207 21,207 5,730,511 Fundraising events 44,019 44,019 44,019 Graduation 260,157 260,157 260,157 Insurance 540,217 540,217 3,375 3,375 543,592 Interest 3,627,269 267,623 3,894,892 3,894,892 Music program 227,077 227,077 227,077 Night school 273,483 273,483 273,483 Office furniture 80,174 57,471 137,645 137,645 Other expenses 370,850 422,784 10,032 803,666 1,145 1,145 214 805,025 Payroll processing fees 156,996 156,996 156,996 Postage and delivery 77,743 67,276 67 145,086 145,086 Printing and copying 1,178,859 87,995 4,783 1,271,637 1,271,637 Professional development 1,440,658 485,912 38,169 1,964,739 3,034 3,034 1,967,773 Rent 8,790,635 350,938 9,141,573 91,495 10,166 101,661 9,243,234 Salaries 58,904,554 6,981,632 442,322 66,328,508 347,969 64,263 412,232 66,740,740 Scholarships 1,113,195 1,113,195 1,113,195
64
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
CONSOLIDATING STATEMENTS OF FUNCTIONAL EXPENSES (CONTINUED)
Year ended June 30, 2016 Noble Network Education Noble Network Charter of Charter Schools Noble Day Care Foundation Supporting Supporting Supporting Services Services Services Program Management Program Management Management Consolidated services and general Fundraising Total services and general Total and general Eliminations Total
Sports activities $ 1,368,878 $ 229,228 $ 1,598,106 $ 1,598,106 Staff advertising and recruitment 103,373 120,503 $ 331 224,207 224,207 Summer of a Lifetime, A Noble Network Program 1,115,052 192,541 94,103 1,401,696 1,401,696 Summer school 338,465 338,465 338,465 Supplies 499,266 124,786 1,128 625,180 $ 2,615 $ 2,615 627,795 Technology 3,772,294 179,017 5,649 3,956,960 3,956,960 Transportation 1,072,495 1,386 1,073,881 1,073,881 Uniforms 833,380 833,380 833,380 Utilities 1,347,357 36 1,347,393 12,403 12,403 1,359,796
Total expenses $ 134,784,943 $ 13,236,430 $ 877,908 $ 148,899,281 $ 624,528 $ 90,551 $ 715,079 $ 63,214 $ (63,000) $ 149,614,574
65
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – NOBLE NETWORK SUPPORT TEAM (NNST)
Years ended June 30, 2017 2016 Supporting Services Supporting Services Program Management Program Management services and general Fundraising Total services and general Fundraising Total
Building maintenance and repairs $ 11,562 $ 11,562 $ 68,267 $ 68,267 Bonus salaries 657,282 $ 31,270 688,552 611,698 $ 52,400 664,098 Contracted maintenance services 1,011 1,011 14,248 14,248 Contractual services and stipends 1,680,870 1,415,297 3,096,167 1,350,315 125,960 1,476,275 CPS administrative fee $ 23,023 23,023 Depreciation and amortization 96,255 96,255 96,864 96,864 Educational materials 66,838 66,838 104,907 104,907 Employee benefits and payroll taxes 1,511,983 70,767 1,582,750 1,250,919 58,945 1,309,864 Field studies 24,491 24,491 10,145 10,145 Food program 86 86 2,943 2,943 Fundraising events 27,380 27,380 44,019 44,019 Interest 228,874 228,874 267,623 267,623 Office furniture 8,058 8,058 57,471 57,471 Other expenses 479,983 89,827 569,810 422,784 10,032 432,816 Payroll processing fees 202,051 202,051 156,996 156,996 Postage and delivery 72,276 148 72,424 67,276 67 67,343 Printing and copying 96,684 2,523 99,207 87,995 4,783 92,778 Professional development 506,355 31,434 537,789 485,912 38,169 524,081 Rent 358,034 358,034 350,938 350,938 Salaries 7,746,256 329,398 8,075,654 6,981,632 442,322 7,423,954 Scholarships $ 1,529,175 1,529,175 641,976 641,976 Sports activities 33,124 33,124 229,228 229,228 Staff advertising and recruitment 137,938 200 138,138 120,503 331 120,834 Summer of a Lifetime, A Noble Network Program 1,269,746 138,532 80,941 1,489,219 1,115,052 192,541 94,103 1,401,696 Supplies 44,856 15 44,871 124,786 1,128 125,914 Technology 85,065 22,428 107,493 179,017 5,649 184,666 Transportation 2,900 2,900 1,386 1,386 Utilities 16 16 36 36
Total expenses $ 2,798,921 $ 14,191,380 $ 2,101,628 $ 19,091,929 $ 1,780,051 $ 13,236,430 $ 877,908 $ 15,894,389
66
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – NOBLE STREET COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 110,628 $ 90,696 Bonus salaries 248,725 240,775 Classroom furniture 10,553 77,185 Contracted maintenance services 107,710 41,046 Contractual services and stipends 57,282 54,619 Contributed services 26,333 CPS administrative fee 160,008 191,760 Depreciation and amortization 158,115 135,378 Educational materials 110,695 93,485 Employee benefits and payroll taxes 1,000,367 903,085 Extracurricular activities 83,117 99,727 Field studies 24,515 30,745 Food program 257,640 258,849 Graduation 16,237 16,265 Insurance 89,593 84,557 Interest 137,073 226,679 Music program 3,152 1,267 Night school 979 10,042 Office furniture 7,797 Other expenses 28,179 8,157 Postage and delivery 1,342 3,501 Printing and copying 53,387 56,099 Professional development 24,124 21,644 Rent 275,429 266,096 Salaries 3,395,820 3,380,288 Scholarships 19,591 Sports activities 62,442 70,844 Staff advertising and recruitment 45 1,896 Summer school 35,789 41,250 Supplies 28,753 23,740 Technology 190,673 191,371 Transportation 30,962 41,502 Uniforms 30,485 36,222 Utilities 113,024 110,808
Total expenses $ 6,846,843 $ 6,863,299
67
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – RAUNER COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 114,582 $ 85,728 Bonus salaries 227,895 377,275 Classroom furniture 15,220 44,894 Contracted maintenance services 118,138 114,445 Contractual services and stipends 45,172 44,162 Contributed services 26,420 CPS administrative fee 159,097 184,694 Depreciation and amortization 237,551 186,734 Educational materials 117,493 146,478 Employee benefits and payroll taxes 961,598 825,649 Extracurricular activities 90,022 86,769 Field studies 42,658 64,597 Food program 239,533 205,423 Graduation 16,720 13,983 Insurance 26,219 24,235 Interest 231,796 383,771 Music program 23,968 22,573 Night school 13,100 17,200 Office furniture 3,033 42 Other expenses 7,076 4,343 Postage and delivery 1,842 3,248 Printing and copying 42,892 52,196 Professional development 30,460 58,497 Rent 185,476 194,286 Salaries 3,336,896 3,234,017 Scholarships 1,280 1,733 Sports activities 67,854 70,992 Staff advertising and recruitment 267 5,260 Summer school 32,075 18,576 Supplies 10,895 17,759 Technology 178,930 172,609 Transportation 67,012 86,795 Uniforms 39,652 45,690 Utilities 52,330 52,063
Total expenses $ 6,738,732 $ 6,873,136
68
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – PRITZKER COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 299,317 $ 122,490 Bonus salaries 361,455 453,585 Classroom furniture 3,070 22,704 Contracted maintenance services 152,883 159,507 Contractual services and stipends 59,723 65,819 Contributed services 31,832 CPS administrative fee 252,778 281,433 Depreciation and amortization 250,002 200,821 Educational materials 388,019 262,750 Employee benefits and payroll taxes 1,312,363 1,155,752 Extracurricular activities 102,629 106,309 Field studies 204,109 161,863 Food program 547,079 514,846 Graduation 23,051 41,831 Insurance 40,961 35,318 Interest 241,894 401,142 Music program 55,270 40,970 Night school 11,398 7,500 Office furniture 8,704 3,304 Other expenses 31,149 28,049 Postage and delivery 8,952 9,838 Printing and copying 37,892 43,872 Professional development 79,591 86,155 Rent 358,092 358,092 Salaries 4,672,511 4,531,962 Scholarships 908 156 Sports activities 132,108 115,889 Staff advertising and recruitment 3,640 8,922 Summer school 34,640 11,248 Supplies 17,845 22,537 Technology 305,953 248,642 Transportation 92,986 135,533 Uniforms 59,844 29,944 Utilities 89,826 86,475
Total expenses $ 10,240,642 $ 9,787,090
69
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – ROWE CLARK COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 54,206 $ 65,613 Bonus salaries 234,978 264,368 Classroom furniture 1,436 1,370 Contracted maintenance services 135,870 134,947 Contractual services and stipends 108,078 40,341 Contributed services 28,082 CPS administrative fee 135,871 178,541 Depreciation and amortization 430,407 412,666 Educational materials 76,355 100,437 Employee benefits and payroll taxes 865,662 937,434 Extracurricular activities 30,412 68,627 Field studies 25,201 69,172 Food program 293,478 314,088 Graduation 14,564 15,563 Insurance 31,538 28,045 Interest 487,625 512,462 Music program 2,079 3,396 Night school 20,867 21,625 Other expenses 31,462 40,478 Postage and delivery 2,972 6,447 Printing and copying 74,878 95,388 Professional development 28,325 43,946 Salaries 3,108,697 3,617,646 Scholarships 255,786 302,903 Sports activities 64,346 36,112 Staff advertising and recruitment 1,944 2,056 Summer school 18,000 31,090 Supplies 24,015 35,056 Technology 274,522 206,559 Transportation 37,038 43,324 Uniforms 21,588 18,861 Utilities 116,798 96,625
Total expenses $ 7,008,998 $ 7,773,268
70
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – GOLDER COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 119,824 $ 59,407 Bonus salaries 190,375 480,689 Classroom furniture 18,669 68,253 Contracted maintenance services 85,641 142,369 Contractual services and stipends 71,035 4,735 Contributed services 28,554 CPS administrative fee 164,854 197,774 Depreciation and amortization 429,691 388,264 Educational materials 53,122 80,175 Employee benefits and payroll taxes 890,730 841,474 Extracurricular activities 31,341 99,091 Field studies 28,022 37,460 Food program 238,529 231,918 Graduation 13,730 14,073 Insurance 44,750 41,565 Interest 671,630 705,159 Music program 21,538 13,252 Night school 4,000 3,000 Office furniture 4,277 18,260 Other expenses 22,939 24,236 Postage and delivery 2,133 1,866 Printing and copying 36,595 49,334 Professional development 34,650 70,706 Rent 262,551 262,551 Salaries 3,162,915 3,082,219 Scholarships 4,494 12,499 Sports activities 78,951 91,458 Staff advertising and recruitment 1,350 1,594 Summer school 12,550 12,000 Supplies 11,378 13,096 Technology 254,834 216,444 Transportation 42,882 64,202 Uniforms 47,488 44,398 Utilities 129,912 123,378
Total expenses $ 7,187,380 $ 7,525,453
71
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – GARY COMER COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 34,913 $ 56,938 Bonus salaries 585,275 663,115 Classroom furniture 21,099 13,188 Contracted maintenance services 100,949 127,787 Contractual services and stipends 446,012 208,226 Contributed services 34,027 CPS administrative fee 283,799 324,697 CPS facility fee 305,971 274,344 Depreciation and amortization 89,562 57,159 Educational materials 117,102 174,091 Employee benefits and payroll taxes 1,555,975 1,442,169 Extracurricular activities 88,909 136,317 Field studies 157,871 166,617 Food program 605,917 542,820 Graduation 39,268 30,283 Insurance 104,662 33,278 Music program 33 Night school 34,769 36,637 Office furniture 1,839 7,546 Other expenses 38,863 34,314 Postage and delivery 2,966 8,752 Printing and copying 133,509 160,223 Professional development 106,322 160,329 Rent 985,802 975,304 Salaries 5,579,386 5,807,436 Scholarships 18,982 Sports activities 110,278 149,605 Staff advertising and recruitment 4,803 12,624 Summer school 48,500 42,710 Supplies 62,910 52,269 Technology 411,138 286,827 Transportation 103,843 90,624 Uniforms 57,083 125,666 Utilities 119,322 115,249
Total expenses $ 12,338,650 $ 12,370,153
72
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – UIC COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 117,122 $ 167,257 Bonus salaries 525,691 628,337 Classroom furniture 17,500 18,471 Contracted maintenance services 138,507 158,968 Contractual services and stipends 80,286 21,826 Contributed services 29,733 CPS administrative fee 226,897 270,157 Depreciation and amortization 206,543 169,349 Educational materials 76,259 166,324 Employee benefits and payroll taxes 1,240,524 1,096,081 Extracurricular activities 64,052 83,339 Field studies 74,511 71,212 Food program 522,457 493,768 Graduation 11,600 267 Insurance 32,480 26,989 Music program 26,727 65,066 Night school 17,750 55,375 Office furniture 2,933 4,442 Other expenses 17,446 22,167 Postage and delivery 4,648 4,190 Printing and copying 94,322 104,749 Professional development 90,096 108,033 Rent 606,416 588,753 Salaries 4,348,062 4,226,844 Scholarships 56,656 57,032 Sports activities 49,151 62,412 Staff advertising and recruitment 5,316 6,001 Summer school 500 10,000 Supplies 44,078 32,624 Technology 311,360 359,957 Transportation 61,599 72,379 Uniforms 44,762 48,492 Utilities 95,078 97,578
Total expenses $ 9,211,329 $ 9,328,172
73
NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – MUCHIN COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 45,395 $ 85,000 Bonus salaries 384,094 461,295 Classroom furniture 26,827 3,740 Contracted maintenance services 116,050 68,098 Contractual services and stipends 82,899 708 Contributed services 23,016 CPS administrative fee 244,401 260,999 Depreciation and amortization 725,310 709,237 Educational materials 89,162 135,835 Employee benefits and payroll taxes 1,167,650 1,042,787 Extracurricular activities 30,846 62,248 Field studies 143,702 238,619 Food program 520,446 515,190 Graduation 38,273 26,040 Insurance 46,411 41,262 Interest 31,238 31,778 Music program 1,940 Night school 3,000 4,670 Office furniture 2,456 6,568 Other expenses 9,317 14,044 Postage and delivery 3,837 4,854 Printing and copying 53,180 62,481 Professional development 101,502 163,257 Rent 1,323,289 1,396,784 Salaries 4,135,950 4,191,855 Scholarships 56,944 53,875 Sports activities 83,841 121,415 Staff advertising and recruitment 2,474 3,710 Summer school 17,938 25,053 Supplies 25,045 40,359 Technology 305,179 374,802 Transportation 109,318 116,507 Uniforms 118,065 66,619 Utilities 103,988 122,356
Total expenses $ 10,148,027 $ 10,477,001
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – CHICAGO BULLS COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 81,428 $ 134,741 Bonus salaries 583,611 646,467 Classroom furniture 9,213 10,909 Contracted maintenance services 229,453 212,085 Contractual services and stipends 48,301 11,815 Contributed services 24,408 CPS administrative fee 273,931 331,345 Depreciation and amortization 209,164 173,515 Educational materials 132,779 114,168 Employee benefits and payroll taxes 1,576,411 1,364,869 Extracurricular activities 216,678 190,684 Field studies 136,784 138,127 Food program 686,029 601,788 Graduation 41,602 28,490 Insurance 40,063 32,245 Music program 17,974 12,807 Night school 24,800 22,500 Office furniture 17,765 Other expenses 7,684 17,205 Postage and delivery 4,581 4,165 Printing and copying 101,453 131,116 Professional development 85,413 87,098 Rent 871,103 845,731 Salaries 5,717,420 5,445,122 Scholarships 4,250 4,448 Sports activities 112,336 100,856 Staff advertising and recruitment 5,992 8,710 Summer school 30,300 31,450 Supplies 15,642 32,106 Technology 340,121 208,437 Transportation 73,549 78,102 Uniforms 66,141 50,585 Utilities 137,678 126,538
Total expenses $ 11,899,649 $ 11,222,632
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – JOHNSON COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 122,034 $ 141,056 Bonus salaries 404,741 567,179 Classroom furniture 32,076 15,371 Contracted maintenance services 156,535 148,048 Contractual services and stipends 195,869 41,116 Contributed services 28,186 CPS administrative fee 219,225 267,210 Depreciation and amortization 267,199 211,027 Educational materials 156,455 198,489 Employee benefits and payroll taxes 1,187,522 1,080,232 Extracurricular activities 61,612 130,164 Field studies 129,177 107,197 Food program 496,172 476,536 Graduation 26,155 28,086 Insurance 33,734 27,101 Music program 244 Night school 6,350 6,000 Office furniture 354 2,332 Other expenses 53,594 54,095 Postage and delivery 3,351 4,477 Printing and copying 86,749 132,574 Professional development 38,197 84,453 Rent 472,928 459,153 Salaries 4,169,729 4,211,459 Scholarships 1,000 Sports activities 63,161 54,178 Staff advertising and recruitment 7,147 5,497 Summer school 22,570 18,500 Supplies 45,749 36,223 Technology 300,063 275,579 Transportation 60,506 80,215 Uniforms 139,300 81,136 Utilities 103,068 102,265
Total expenses $ 9,062,566 $ 9,075,134
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – HANSBERRY COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 78,838 $ 46,303 Bonus salaries 302,144 353,710 Classroom furniture 6,720 61,777 Contracted maintenance services 105,049 151,052 Contractual services and stipends 116,269 45,000 Contributed services 25,365 CPS administrative fee 175,959 232,335 Depreciation and amortization 783,519 756,382 Educational materials 111,884 218,690 Employee benefits and payroll taxes 1,035,766 977,289 Extracurricular activities 32,723 95,675 Field studies 66,477 59,787 Food program 438,016 475,954 Graduation 14,100 32,099 Insurance 55,045 55,113 Interest 1,038,641 1,038,641 Music program 5,572 12,526 Night school 6,000 1,000 Office furniture 3,791 Other expenses 22,938 18,033 Postage and delivery 3,317 4,334 Printing and copying 76,533 80,675 Professional development 32,041 126,647 Rent 171,028 171,028 Salaries 3,795,645 3,945,708 Sports activities 46,474 57,889 Staff advertising and recruitment 3,244 10,141 Summer school 28,000 22,027 Supplies 67,579 70,021 Technology 227,114 221,245 Transportation 35,735 58,775 Uniforms 42,557 42,397 Utilities 101,779 83,041
Total expenses $ 9,026,706 $ 9,554,450
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – DRW COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 12,012 $ 23,269 Bonus salaries 212,574 354,172 Classroom furniture 48,356 8,895 Contracted maintenance services 700,798 639,245 Contractual services and stipends 33,155 46,666 Contributed services 27,930 CPS administrative fee 134,548 189,890 Depreciation and amortization 166,508 157,498 Educational materials 106,625 187,876 Employee benefits and payroll taxes 871,952 830,595 Extracurricular activities 65,832 141,546 Field studies 72,560 71,899 Food program 295,258 235,859 Graduation 18,282 13,177 Insurance 18,725 17,445 Music program 10,427 12,358 Night school 4,000 22,500 Office furniture 41 Other expenses 36,029 52,004 Postage and delivery 5,263 5,352 Printing and copying 54,818 68,170 Professional development 18,281 70,655 Rent 175,682 214,651 Salaries 3,147,725 3,392,025 Sports activities 77,932 115,955 Staff advertising and recruitment 193 3,675 Summer school 29,500 32,830 Supplies 9,547 15,307 Technology 178,024 235,630 Transportation 50,771 62,960 Uniforms 40,332 46,637
Total expenses $ 6,595,709 $ 7,296,712
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – BAKER COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 5,830 $ 19,325 Bonus salaries 250,122 255,299 Classroom furniture 26,065 81,437 Contractual services and stipends 31,870 52,541 Contributed services 21,894 CPS administrative fee 96,751 129,125 CPS facility fee 360,841 333,558 Depreciation and amortization 77,293 70,177 Educational materials 73,314 86,563 Employee benefits and payroll taxes 678,031 602,265 Extracurricular activities 35,096 50,650 Field studies 60,475 41,855 Food program 173,902 168,217 Graduation 6,716 Insurance 15,626 12,828 Night school 8,150 17,420 Office furniture 1,703 1,656 Other expenses 27,767 2,791 Postage and delivery 6,211 5,861 Printing and copying 34,523 31,248 Professional development 20,396 37,134 Rent 594,525 577,209 Salaries 2,529,807 2,329,832 Sports activities 47,097 47,063 Staff advertising and recruitment 1,329 1,889 Summer school 13,393 11,281 Supplies 8,927 17,751 Technology 156,109 176,002 Transportation 33,089 30,144 Uniforms 36,578 49,139
Total expenses $ 5,411,536 $ 5,262,154
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – BUTLER COLLEGE PREP
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 34,497 $ 65,727 Bonus salaries 323,640 328,171 Classroom furniture 149,175 141,540 Contractual services and stipends 119,706 103,169 Contributed services 24,718 CPS administrative fee 143,567 134,369 CPS facility fee 502,201 375,306 Depreciation and amortization 80,769 69,419 Educational materials 67,671 80,112 Employee benefits and payroll taxes 732,547 626,995 Extracurricular activities 25,089 91,127 Field studies 36,590 19,207 Food program 276,445 229,514 Graduation 25,409 Insurance 20,474 15,419 Music program 44,896 35,589 Night school 15,900 28,480 Office furniture 1,427 22,015 Other expenses 25,001 15,089 Postage and delivery 4,562 3,275 Printing and copying 41,118 28,378 Professional development 60,570 92,796 Rent 436,052 423,572 Salaries 2,919,600 2,593,452 Sports activities 59,365 96,583 Staff advertising and recruitment 3,269 6,813 Summer school 23,500 24,400 Supplies 42,017 29,352 Technology 236,042 174,913 Transportation 51,420 43,537 Uniforms 117,759 17,056
Total expenses $ 6,620,278 $ 5,940,093
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – ITW DAVID SPEER ACADEMY
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 356,201 $ 89,581 Bonus salaries 501,450 480,000 Classroom furniture 39,659 85,049 Contracted maintenance services 42,708 45,590 Contractual services and stipends 76,827 42,629 Contributed services 27,151 CPS administrative fee 205,280 209,470 Depreciation and amortization 742,811 712,210 Educational materials 296,034 390,870 Employee benefits and payroll taxes 1,066,639 849,925 Extracurricular activities 36,073 88,698 Field studies 33,618 15,993 Food program 566,169 322,244 Insurance 46,953 43,004 Interest 299,726 327,637 Music program 130 1,300 Night school 14,000 16,534 Office furniture 639 2,380 Other expenses 31,223 24,631 Postage and delivery 3,808 4,151 Printing and copying 67,552 56,978 Professional development 63,023 154,415 Salaries 4,011,347 3,298,602 Sports activities 181,977 157,731 Staff advertising and recruitment 4,585 14,558 Summer school 26,300 Supplies 24,430 50,850 Technology 327,393 208,033 Transportation 51,513 52,443 Uniforms 18,190 97,679 Utilities 102,935 97,994
Total expenses $ 9,239,193 $ 7,968,330
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – THE NOBLE ACADEMY
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 40,512 $ 69,261 Bonus salaries 162,339 141,301 Classroom furniture 30,130 22,582 Contracted maintenance services 83,939 89,434 Contractual services and stipends 56,296 317,638 Contributed services 19,871 CPS administrative fee 89,303 72,355 Depreciation and amortization 42,172 38,645 Educational materials 62,072 95,909 Employee benefits and payroll taxes 461,625 327,092 Extracurricular activities 2,340 15,763 Field studies 46,470 42,047 Food program 178,423 119,347 Insurance 13,427 21,813 Music program 20,198 4,033 Night school 1,500 3,000 Office furniture 2,603 Other expenses 2,432 10,022 Postage and delivery 3,581 2,878 Printing and copying 31,761 25,237 Professional development 47,094 72,534 Rent 334,905 2,057,425 Salaries 1,778,029 1,574,587 Sports activities 47,596 19,896 Staff advertising and recruitment 5,304 3,555 Summer school 15,100 6,050 Supplies 11,067 9,247 Technology 136,167 214,761 Transportation 19,534 15,453 Uniforms 24,223 21,649 Utilities 107,877 132,987
Total expenses $ 3,858,019 $ 5,566,372
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – MANSUETO HIGH SCHOOL
Years ended June 30, 2017 2016 Program services
Building maintenance and repairs $ 82,966 $ 13,525 Bonus salaries 126,864 15,500 Classroom furniture 2,383 Contracted maintenance services 299 Contractual services and stipends 19,377 8,520 Charitable contributions 19,004,200 CPS administrative fee 45,179 Depreciation and amortization 18,714 Educational materials 30,641 4,075 Employee benefits and payroll taxes 259,630 14,384 Extracurricular activities 10,740 300 Field studies 20,770 259 Food program 48,031 Insurance 23,419 Interest 108,137 Night school 6,000 Office furniture 383 Other expenses 1,026 1,192 Postage and delivery 1,685 554 Printing and copying 7,358 141 Professional development 30,979 2,359 Rent 190,000 Salaries 1,031,699 41,500 Sports activities 19,716 Staff advertising and recruitment 5,542 6,472 Supplies 14,825 969 Technology 161,794 483 Transportation 10,283 Uniforms 15,288 11,210
Total expenses $ 21,297,928 $ 121,443
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – NOBLE DAY CARE
Years ended June 30, 2017 2016 Supporting Supporting Services Services Program Management Program Management services and general Total services and general Total
Building maintenance and repairs $ 19,291 $ 19,291 $ 11,895 $ 11,895 Contracted maintenance services 37,149 37,149 28,070 28,070 Depreciation and amortization 15,980 $ 1,775 17,755 15,980 $ 1,775 17,755 Educational materials 8,522 8,522 7,656 7,656 Employee benefits and payroll taxes 93,737 18,493 112,230 77,684 14,347 92,031 Food program 21,710 21,710 21,207 21,207 Insurance 1,859 1,859 3,375 3,375 Other expenses 8,249 8,249 1,145 1,145 Professional development 3,390 3,390 3,034 3,034 Rent 72,024 8,003 80,027 91,495 10,166 101,661 Salaries 368,800 72,024 440,824 347,969 64,263 412,232 Supplies 2,379 2,379 2,615 2,615 Utilities 11,518 11,518 12,403 12,403
Total expenses $ 664,608 $ 100,295 $ 764,903 $ 624,528 $ 90,551 $ 715,079
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF FUNCTIONAL EXPENSES – NOBLE NETWORK EDUCATION FOUNDATION
Years ended June 30, 2017 2016 Supporting Services Management and general
Contractual services and stipends $ 63,000 $ 63,000 Other expenses 146 214
Total expenses $ 63,146 $ 63,214
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NOBLE NETWORK OF CHARTER SCHOOLS, SUBSIDIARIES AND AFFILIATE
STATEMENTS OF ACTIVITIES – SUMMER OF A LIFETIME, A NOBLE NETWORK PROGRAM
Years ended June 30, 2017 2016 Temporarily Temporarily Unrestricted Restricted Total Unrestricted Restricted Total
Revenue: Contributions and grants $ 549,774 $ 518,996 $ 1,068,770 $ 666,005 $ 580,822 $ 1,246,827 Fundraising events 180,057 180,057 86,359 86,359 Transfer of revenues from campuses 322,000 322,000 345,850 345,850 Net assets released from restrictions: Satisfaction of purpose or time restrictions 480,822 (480,822) 355,338 (355,338)
Total revenue 1,532,653 38,174 1,570,827 1,453,552 225,484 1,679,036
Expenses: Administrative expenses 11,944 11,944 25,538 25,538 Credit card processing fees 4,170 4,170 2,280 2,280 Event expenses 80,941 80,941 94,103 94,103 Executive director fees and other salaries 122,418 122,418 164,723 164,723 SOL program support 1,269,746 1,269,746 1,115,052 1,115,052
Total expenses 1,489,219 1,489,219 1,401,696 1,401,696
Change in net assets $ 43,434 $ 38,174 $ 81,608 $ 51,856 $ 225,484 $ 277,340
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