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Wbst-Fm Radio Ball State University Department of Internal Audit and Advisory Services January 6, 2015 WIPB Television Fiscal Year 2014-15 TABLE OF CONTENTS Page Auditor's Report on the Financial Statements ............................................................................ 3-4 Management’s Discussion and Analysis ............................................................................... 5-11 Statement of Net Assets ............................................................................................................... 12 Statement of Revenues, Expenses and Changes in Net Assets ................................................... 13 Statement of Cash Flows ............................................................................................................. 14 Notes to the Financial Statements .......................................................................................... 15-22 2 The Corporation for Public Broadcasting Washington, D. C. Report on the Financial Statements We have audited the accompanying basic financial statements of WIPB Television, a component unit of Ball State University, as of and for the years ended June 30, 2015 and 2014. These financial statements are the responsibility of the Station's management. Our responsibility is to express an opinion on these financial statements based on our audit. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these 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 financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the 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 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 WIPB Television internal control. Accordingly, we express no such opinion. An audit 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 financial statement. Internal Auditing is a unit of Ball State University. The Director is a Certified Public Accountant, who is not in any way responsible for the accounting operations of the Station, nor 3 connected with the establishment of the overhead rates and hence is deemed independent per the Corporation for Public Broadcasting's certification requirements. The opinion that follows is issued pursuant to the Corporation for Public Broadcasting's guidelines concerning independence. The undersigned does not purport to meet the independence status requirements specified by generally accepted auditing standards. We believe that our audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of WIPB Television as of June 30, 2015 and 2014, and the changes in financial position and its cash flows for the year then ended in conformity with generally accepted accounting principles in the United States of America. Prior Period Adjustment As discussed in Note G to the financial statements, a misstatement of previously reported net position as of June 30, 2014 was identified in the current year. Accordingly, retrospective adjustments have been made to net position. Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information The Management’s Discussion and Analysis (MD&A) is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Tom Roberts, CPA Director of Internal Audit and Advisory Services Muncie, IN January 6, 2016 4 WIPB Television Management Discussion and Analysis For the Year Ended June 30, 2015 Introduction This discussion and analysis of WIPB’s financial statements provides an overview of WIPB’s financial activities for the year ended June 30, 2015. Management has prepared the financial statements and the related footnote disclosures along with the discussion and analysis. The discussion and analysis is designed to provide an objective analysis of WIPB’s financial activities based on currently known facts, decisions, and conditions. The completeness and fairness of the financial statements, notes to the financial statements, and this discussion are the responsibility of WIPB management. Using this Report This financial report consists of a series of financial statements, prepared in accordance with the Governmental Accounting Standards Board Statement No. 35, Basic Financial Statements-and Management’s Discussion and Analysis-for Public Colleges and Universities. These financial statements focus on the financial condition of the University, the results of operations, and cash flows of the station as a whole. - The three basic financial statements are: the Statement of Net Assets, Statement of Revenues, Expenses and Changes in Net Assets, and the Statement of Cash Flows. This annual financial report includes the report of independent auditors, the management’s discussion and analysis, the basic financial statements referred to above, notes to the financial statements and supplemental information. Financial Highlights The grant to WIPB-TV from the Corporation for Public Broadcasting decreased. Revenue from Membership decreased from the prior year. Underwriting revenue increased from the prior year due to a strengthening economy The University continues to provide support to WIPB-TV. Telesale revenue increased slightly over the previous year however sponsorships decreased. 5 Outreach activities continued to be successful in participation and benefited the station financially through local business sponsorships. The Statement of Net Assets and the Statement of Revenues, Expenses and Changes in Net Assets In order to assess the overall health of WIPB, factors that need to be considered are the overall economic climate of the State of Indiana and the trends of PBS on a national level as it pertains to membership, underwriting and programming. These statements include all assets and liabilities using the accrual basis of accounting, which is similar to the accounting used by most private-sector institutions. All of the current year’s revenues and expenses are taken into account, regardless of when cash was received or paid. The following is a summary of the major components of the net assets and operating results of WIPB for the year ended June 30, 2015: Net Position June 30, 2015 and 2014 2015 2014 Assets: Current Assets $273,139 $265,299 Noncurrent Assets 889,522 2,363,132 Total Assets $1,162,661 $2,628,431 Liabilities: Current Liabilities $3,014 $5 Net Position: Invested in Capital Assets, Net of Related $889,522 $2,363,132 Debt Restricted for External Grants 59,715 59,715 Unrestricted 210,411 270,741 Total Net Position $1,159,648 $2,628,426 Total Liabilities and Net Position $1,162,661 $2,628,431 \ 6 Statement of Revenues, Expenses And Changes in Net Position For the Years Ended June 30, 2015 and 2014 2015 2014 Operating Revenues: Grants and Contracts $1,107,167 $1,262,580 Contributed Support 2,087,462 2,183,841 Memberships and Subscriptions 180,511 192,939 Business/Industry Underwriting 312,070 336,276 Other Operating Revenues 154,434 126,419 Total Operating Revenues $3,841,644 $4,102,055 Operating Expenses: Programming Production $1,223,277 $1,141,323 Other Expense 2,962,853 3,491,468 Total Operating Expenses $4,186,129 $4,632,789 Operating Income ($344,485) ($530,734) Increase in Net Assets ($344,485) ($530,734) Operating Revenues Operating revenues increase net assets and include all transactions that result in sales and/or receipts from goods and services such as tuition
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