Finance Committee...

Finance Committee Agenda

April 20, 2012 3:00 p.m.

Lansdell Hall, Room 107

Call to Order and Opening Prayer ........................................................ Ronnie Hypes, Chair

Introductions/Opening Remarks ......................................................... Ronnie Hypes, Chair

Minutes from Meeting of October 13, 2011 ......................................... Ronnie Hypes, Chair

2010-11 OMB-A-133 Independent Audit Report ................................. Ronnie Hypes, Chair

February 2012 (or March 2012) Interim Financial Report ................ Sarah Beamer, VPFA

Operating Projections for 2011-12 & Related Cash Flow ................... Sarah Beamer, VPFA

Line of Credit Update ........................................................................... Sarah Beamer, VPFA

Resolution to Approve Preliminary Budget for 2012-13 ..................... Ronnie Hypes, Chair

New Initiatives (Townhouses, Campus Community Wellness Center, and Intersection of College & Stadium Dr.)………….……………………...David Olive, President General Discussion .............................................................................. Committee Members

Closing Remarks ................................................................................... Ronnie Hypes, Chair

Prayer Concerns and Closing Prayer

FINANCE AND ADMINISTRATION (GENERAL, BUSINESS OFFICE, HUMAN RESOURCES, CAMPUS STORE,

INFORMATION SERVICES AND TECHNOLOGY, AND FOOD SERVICE)

REPORT TO THE BOARD OF TRUSTEES

Finance and Administration Submitted by Sarah Beamer, Vice President for Finance and Administration

(Note: The Facilities report is included in a separate section of the Board Report.)

2005-06 2006-07 2007-08 2008-09 2009-10 2010-116/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2010

Academic Year Traditional Student Average

Full-Time-Equivalent (FTE)372 376 376 353 384 395 (a)

Endowment Market Value at Fiscal Year End $4,831,396 $5,581,399 $5,193,997 $4,333,100 $4,683,102 $5,346,232 (b)

Endowment Market Value per FTE $12,988 $14,844 $13,814 $12,275 $12,196 $13,535 (c)

Total Net Assets $9,866,832 $11,275,611 $11,111,377 $8,256,454 $8,568,292 $9,704,829 (b)Total Net Assets

per FTE $26,524 $29,988 $29,552 $23,389 $22,313 $24,569 (c)

Total Operating Revenue $11,706,965 $12,361,366 $13,025,315 $12,611,479 $14,804,782 $15,269,748 (b)Total Operating Revenue

per FTE $31,470 $32,876 $34,642 $35,727 $38,554 $38,658 (c)

Total Operating Expenditures $11,429,976 $11,827,259 $13,225,911 $14,748,353 $14,887,292 $14,916,706 (b)Total Operating Expenditures

per FTE $30,726 $31,455 $35,175 $41,780 $38,769 $37,764 (c)

Number of Full-Time Faculty 33 33 34 37 36 37 (d)Number of Part-Time Faculty 77 60 67 59 58 50 (d)

Number of Full-Time Staff 65 63 69 71 61 75 (d)Number of Part-Time Staff 5 16 12 15 12 9 (d)

Number of Total Employees 180 172 182 182 167 171 (c)

Total Salaries $4,168,516 $4,335,613 $4,702,736 $5,155,986 $4,887,037 $4,871,017 (e)Total Benefits $962,732 $996,478 $1,219,380 $1,326,833 $1,214,199 $1,121,330 (e)

Benefit Percentage 23% 23% 26% 26% 25% 23% (c)Total Compensation $5,131,248 $5,332,091 $5,922,116 $6,482,819 $6,101,236 $5,992,347 (c)

Grayed area to be completed when audited financial statements are available.

SOURCES: (a) Registrar's records.(b) Audited financial statements.(c) Calculated from data shown.(d) IPEDS.(e) Acct/payroll records for periods prior to 2008-09; 2008-09 forward from audited finc stmts.

ADDITIONAL NOTE: Operating revenues are NOT reduced by scholarship expense; scholarships are included as operating expenditures in these numbers, rather than as a reduction of revenue.

Fiscal Year / Year-End

Bluefield CollegeFinance and Administration Dashboard

Prepared by Sarah Beamer, Vice President for Finance and Administration

85.8% Total Student Revenue

$13,099,511

Opera;ng Revenue 2010-‐11

Total $15.3 million

0.3%

Other Income $48,203

13.9% Gift/Grant Related Revenue

$2,122,034

27.3% Total Academic Expenditures $4,073,033

14.9% Student Services Expenditures $2,220,582

14.0% Support Expenditures

$2,092,271

Opera;ng Expenditures 2010-‐2011

Total $14.9 million

7.4% Auxiliary Services Expenditures $1,098,105

11.1% Facilities

Expenditures $1,649,092

1.9% Interest Expense $283,158

23.5% Scholarship Expense

$3,500,465

Significant highlights of the last six months:

• Specific highlights from departments within the finance and administration area are included in sections below. Recent focus within these areas has been on:

Ø Gathering data and preparing narratives for the finance and facilities sections of the SACSCOC reaccreditation compliance certification.

Ø Installing additional technology upgrades—primarily server replacements in a move toward virtualized server architecture (to improve system scalability and overall hardware resource utilization).

Ø Preparing the Preliminary Architectural Report for the USDA for the proposed townhouse complex.

Ø Revising budget projections for the remainder of fiscal year 2011-12, as the inSPIRE program remains in “start-up” mode.

Ø Implementing an additional employee benefit—vision coverage—effective January 1.

Ø Completing the OMB A-133 federal audit of the College’s federal financial aid funds and USDA loan funds.

Ø Working on institutional effectiveness mid-year administrative assessment reports.

Ø Providing financial and personnel information for various external surveys and regulatory reports.

Ø Continuing to focus on the College’s financial stabilization. • The interim managerial financial statements, notes, accounts receivable

aging, and operating cash account balance trend for February 29, 2012 are included at the end of this finance and administration section of the Board report.

• Since investments are a major portion of the College’s assets, also included with this Board report is the February 29, 2012, investment analysis and allocation report. This report reflects that the market value of investments has increased from $5.0 million at June 30, 2011, to $5.3 million at February 29, 2012. (Please note that, in fiscal year 2011-12, a donor directed that the College transfer $120,000 of restricted scholarship funds to an endowment. Therefore, $120,000 of the “new” deposits/gifts on the investment analysis schedule represents that transfer.) The endowment market value differs slightly from the College’s investment value, since the endowment also includes funds held in trust by others and some endowment cash (held from recent endowment gifts, to be used to apply toward the endowment spending payout), netted by trust and annuity obligations. Net endowment statistics for the ten most recent fiscal year-ends are shown in the chart below.

Fiscal Year End

Market Value of Endowment Funds

Net Total Endowment

Investment Return

Endowment Per Student

6/30/2011 $5,346,232 15.0% $13,4336/30/2010 $4,683,102 8.6% $12,1966/30/2009 $4,331,097 (13.0%) $12,5546/30/2008 $5,193,997 (2.1%) $14,1536/30/2007 $5,581,399 15.8% $15,1266/30/2006 $4,831,396 11.0% $13,1656/30/2005 $4,459,689 8.5% $10,9316/30/2004 $4,247,261 15.5% $10,3346/30/2003 $3,660,650 (3.3%) $8,2826/30/2002 $3,276,125 (21.6%) $7,248

Bluefield CollegeEndowment Statistics

Prepared by: Sarah A. Beamer, VPFA, 3/15/12SOURCE: Audited financial statements and related management letter.

• While reviewing the interim February financial information, certainly the question arises as to how the fiscal year 2011-12, ending June 30, 2012, will end financially. Based on spring enrollment data to-date, I offer the following analysis, as updated from the information presented at the Board retreat in February: o Budget based upon traditional average academic year headcount of 488

and FTE of 460; actual average academic year headcount enrollment is 458 and FTE is 432 à Revenue shortfall—BUT SEE NEXT ITEM ($560,000)

o Budget based upon $4,091,000 million unfunded financial aid (including traditional, inSPIRE, and employees/dependents); actual $3,691,000 (budgeted 45% unfunded discount; actual closer to 40%) àExpenditure savings $460,000

o Backfill/reallocate funded financial aid to subsidize unfunded aid (primarily Whitt funds for general scholarships) à Expenditure savings $200,000

o Budget based upon traditional average academic year residential students of 320; actual average academic year residential census is 297 à Revenue shortfall ($105,000)

o Budget based upon 286 average inSPIRE students across three semesters ($385/cr hr); actual enrollment now projected to average 165 across six terms ($325/cr hr) (five terms with dates in fiscal year 2011-12) à Revenue shortfall ($1,800,000)

NOTE: Based on projection of 30 new inSPIRE students for the remaining start this FY (5/7/12) and retention of continuing DCP students at 95% o Budget based upon 2,200 total AGEO credit hours @ $385/credit hour;

actual projected to be 2,821 @ $325/credit hour à Revenue excess $80,000

o Add inSPIRE incremental direct costs (netbook and electronic textbooks) à Expenditure excess ($240,000)

o Tuition benefit savings à Expenditure savings $150,000

o Miscellaneous personnel savings à Expenditure savings $50,000

o Use capital funds instead of operating budget for admissions Vehicle lease buy-out and some technology purchases à Expenditure savings $75,000

o Ingram estate proceeds (unrestricted) à Revenue excess $700,000

à Net budget shortfall projected as of March 15, 2012 à ($990,000)

Cash flow effect: Add back depreciation $724,000 Add back bad debt expense $50,000 Subtract principal payments on debt (capital leases) ($95,000) Subtract payments into USDA debt reserve ($35,000) Subtract essential capital purchases as budgeted in fall ($460,000) NOTE: $30,000 of these capital funds have been used for the townhouse project.

à Net projected cash deficit for 6/30/12, as of Feb 18, 2012 à ($806,000)

NOTE: The projection above is exclusive of unrestricted fundraising results, except

for anticipated use of the Ingram estate proceeds.

• The April Board meeting will include as an action item approval of the College’s preliminary budget for 2012-13. As the budget is beginning to develop, the following items are being considered:

Ø A 475 traditional student academic year average full-time equivalent enrollment, which equates to a 528 student headcount in the fall—a 10 percent increase over the current year.

Ø A 44 percent traditional student unfunded scholarship tuition discount; actual for the current year is closer to 40 percent.

Ø An 11 percent increase in traditional residential students, as a result of increased student numbers and increased residential percentage (with continued enforcement of the requirement for athletes to live on campus). This could mean 344 residential students on campus at census date in the fall, putting us at total capacity, even as we bring additional rooms in Alumni Hall on line in the fall (first floor). (Because of the athletic attrition that occurs from fall sports between the time that athletes arrive in early August until census date, we project that we could need to assign as many as 360 resident spaces for the fall, compared to our capacity of 370. In that case, we will be considered basically at full capacity!)

Ø A 75 percent increase in average per term inSPIRE students for 2012-13 as compared to actual for 2011-12—more comparable to inSPIRE enrollment levels of a few years ago—as we progress from the “start-up” nature of the inSPIRE model adjustments of 2011-12.

Ø A 62 percent increase in e-Spire credit hours for 2012-13, as compared to the current year.

Ø Discontinuation of the inSPIRE netbook initiative, whereby the cost of a netbook to each inSPIRE student was included in the price of their tuition.

Ø No unfunded scholarship assistance to inSPIRE students, because of the tuition reduction that occurred in 2011-12, with only a minimal increase approved for 2012-13.

Ø A reduction in the endowment payout (as a result of the 12-quarter average market value decrease).

Ø Debt and capital-related expenditures to include the second year of principal payments on the USDA debt and funding for new technology to be paid with funded/budgeted depreciation, rather than separate budget items.

Ø Various projected facility/utility increases (commercial insurance, electricity, natural gas, water, laundry service/lease, Roanoke lease, and facilities management outsourcing).

Ø Health insurance and other benefit increases (including tuition benefit costs for employees and dependents).

Ø A $400,000 reduction in the unrestricted fundraising goals—to a total of $500,000. The goal was doubled for 2009-10 and has remained at that high level, which cannot be sustained.

Ø In relation to institutional effectiveness and assessment, area budget requests have been received. The College Leadership Team continues to meet to determine if, which, and to what extent these requests might be funded.

Budgeting at Bluefield College remains challenging! As revenues and expenditures have been reviewed carefully, it has become ever more obvious that the College must increase its enrollment in order to provide the desired level of services. The introduction of football and the new inSPIRE model are efforts toward increased

enrollment and stabilized finances. Long-term growth must be achieved with deliberate preparation and with strategic planning toward initiatives that will result in healthy, stable, and persistent growth.

• The College continues to maintain a current status on monthly payments toward the $6,170,000 USDA financing. Terms include: 4.5 percent interest, 40-year amortization, and debt reserve of one year’s worth of debt service to accumulate over 10 years. Total fiscal year cash outflow for this debt totals $375,000, including principal, interest, and debt reserve accumulation.

• The College has been blessed not to have found it necessary to borrow against its line of credit at all for the past two fiscal years or to-date in the current fiscal year. As a safety net, however, the College maintains a $1 million credit line, funded jointly by First Community Bank (lead bank), National Bank, BB&T, MCNB, and First Sentinel Bank. The interest rate on the credit line is prime plus 1 percent, with a floor of 5.5 percent—a reduction from the 7.5 percent floor of the prior two years, offered in recognition of the College’s stabilizing financial outlook, according to First Community Bank.

Significant objectives for the next six months:

• Specific objectives for departments within the finance and administration area are included in sections below. Objectives of particular interest within these areas are:

Ø Working with the Council of Independent Colleges in Virginia (CICV) to pursue a possible commercial insurance consortium arrangement (similar to the CICV health-related insurance program, which is working very well).

Ø Installing additional technology upgrades—primarily campus-wide copier replacements, additional personal computer replacements, and SMART/multi-media classroom upgrades.

Ø Preparing the Financial Feasibility Report for the USDA for the proposed townhouse complex.

Ø Providing financial and personnel information for the 2010-11 Fact Book (to be distributed at the Board meeting).

Ø Participating in the reorganization of administrative areas to develop a “one-stop shop” for student administrative needs, to include combining the areas of students accounts, registration, and financial aid.

Ø Working on enhanced billing for the inSPIRE program, to facilitate electronic billing for those students.

Ø Sending (in late April 2012) a customer service survey for the finance and administration areas, to students, faculty, and staff. The survey results will again be used for institutional effectiveness reporting for our areas.

Ø Evaluating (with the Board’s Finance Committee) the status of the College’s investment portfolio in relation to the revised investment policy approved by the Board in October 2011; this evaluation will include consideration of hiring (a) new investment manager(s).

Ø Revising the College’s credit line renewal timeframe—to reschedule the renewal from the summer, the lowest cash point for the College, to the fall or spring.

Ø Preparing responses for the Focused Report regarding any (if any!) resource-related findings from the College’s SACSCOC compliance certification reaffirmation review.

Ø Closing the fiscal year and preparing for the financial statement audit for 2012-13. While this is a routine task, highlighting it in this report is appropriate this year in relation to our SACSCOC reaccreditation review. Because of the timing of our on-site SACSCOC review, we will be expediting our fiscal year close and audit process in order to submit the audit results in early September to the on-site SACSCOC review committee.

Ø Continuing to work toward replenishing cash to support temporarily restricted purposes and to begin to build capital and general cash reserves. Obviously this goal is dependent on the strength of the College’s general finances.

Ø Evaluating staffing levels in the financial and information services and technology (IST) areas, to address some audit management letter comments as well as to enhance customer service. (During the work force reduction in spring 2009, the business office staff was cut by one-third and the IST staff was cut by 40 percent. While some staffing has been restored since then, staffing in these areas still is thin.) A tentative plan is developing to hire at least one additional position in the financial area (a Director of Finance and Facilities) and possibly reassign some responsibilities to generate perhaps one-half of an IST position. These staffing changes could occur during fiscal year 2012-13, if funds are identified.

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Business Office

Submitted by Amy Ellison, Controller Significant highlights of the last six months:

• Accounts receivable shows an increase between February 28, 2011, and February 29, 2012, primarily because of the additional inSPIRE start dates (six per year, rather than two-three). The business office uses various collection agencies for accounts that are significantly past due. However, we work internally on accounts that are not very delinquent (current students with payment issues). Caroline Dixon was hired within the past year to spend one-half of her time in the business office focusing on account collections. (This restored position allocates the other one-half time to human resources.) Caroline is working with our collection agencies to keep collections current. She is an alumna of Bluefield College and has experience in collections in the banking industry. Within the past year, we have added a new collection agency called Recovery Management Services, Inc. (RMS). RMS offers a pre-collect service (30 day notices before officially going to collections). This firm was recommended to us by some other small private colleges. Steven Quackenbush, a freshman status student majoring in Christian studies, is working as a college work-study in the business office, assisting Caroline.

• Accounts payable continues to be processed in a timely manner by Shirley Mutter, Accounts Payable/Payroll Manager. Shirley has revised the agreement for employee credit card holders to strengthen the college’s internal controls. This new form now includes supervisory approval of each employee credit card holder. Katilyn Duggins, senior status student majoring in business, helps process payables in her work-study position in the business office.

• The business office received a full-time three year VISTA grant position in November 2011, titled Student Financial Advocate. Samantha Morris was hired for this position. In accomplishing her tasks required by the VISTA Assignment Description (VAD), she assists with student account transactions and updates the policies and procedures manual regarding student financial transactions. Samantha is currently working on her undergraduate degree at Bluefield State College.

• The business office has updated written processes and procedures, in order to enhance documentation for our upcoming SACSCOC reaccreditation review.

• Anna “Michele” White, Student Accounts Coordinator, enrolled in the online Management and Leadership inSPIRE program in October 2011. She is working hard toward her Bachelor’s Degree.

• Amy Ellison, Controller, helped prepare the Form 990, filed on time in November 2011.


• Plans are developing to create a “one-stop shop,” to include combining the areas of students accounts, registration, and financial aid, in order to provide better customer service to all students. Last fall, we began offering extended phone office hours in the evenings from 5:00 p.m. to 8:00 p.m. to be more available particularly to our inSPIRE student. These extended phone hours are available Monday through Thursday. The business office (student accounts area) is in the rotation to cover the extended hours, with the registrar’s office, the financial aid office, and the inSPIRE admissions office. This effort has stimulated cross-training between these offices, in preparation for the one-stop shop concept.

• In preparing to complete the Virginia Unclaimed Property Report, due November 1 each year (if required), the business office will complete due diligence over the summer. All outstanding checks over six months old will be researched and voided/re-issued, if needed. (Bluefield College was not required to complete this report on November 1, 2011, as we had nothing relevant to report.)

• In conjunction with critical operations/emergency response planning, the business office will provide additional encouragement to employees and student workers to select direct deposit for their payroll. An emergency response plan for the business office is an ongoing project.

• The business office is excited to continue to minister to and be role models for our student workers in the office, which include Katilyn and Steven.

• While the finance area has achieved its goal of preparing internal managerial financial statements for every month-end beginning August 2009, we hope to condense our month-end reconciliation and closing process to have these monthly financial statements completed sooner—perhaps by the 10th of the subsequent month rather than later in that month.

• A continuing goal for the business office is to reduce accounts receivable by keeping collections current. The business office staff would like to attend a seminar regarding collection laws, to become more familiar with collection issues.

• Shirley Mutter, Accounts Payable/Payroll Manager, will begin training on payroll processing. The business office is reassigning responsibility for payroll processing from the Controller to the Accounts Payable and Payroll Manager (transition of a position), to enhance internal financial controls. While the Controller will continue to serve as payroll processor back-up, this transition will remove the Controller from routine payroll processing responsibility, further strengthening control over payroll.

• Anna “Michele” White, Student Accounts Coordinator, is working with the IST department to develop a secure way for parents/guardians to view student account statements online via MyBC. While students can access their account information online, currently parents/guardians cannot.

• The Business Office/Human Resources Assistant is working with the registrar’s office and the IST department to enhance the system coding for student charges, to reduce the amount of manual work involved with student billing.

• In April 2012, the business office will send a customer service survey (combined survey for all finance and administrative areas) to students, faculty, and staff. As in the past, the survey results will be used for institutional effectiveness reporting for the business office. We believe that customer service has improved, as we have acted upon survey results from April 2011—for example, implementing staffing assignment changes and in-office training to enhance our ability to respond to inquiries in a more timely manner, and communicating as much as possible in writing (by email), to ensure thorough follow-up.

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Human Resources

Submitted by Karen Thurmer, Human Resources Director Significant highlights of the last six months:

• On December 1, 2011, Bluefield College replaced Reliance with Lincoln Financial Group as our life insurance carrier, to receive a decrease in rates with a three-year rate guarantee. This change also allowed us to add 10 percent toward the long-term disability benefit for anyone that is catastrophically disabled (permanently), increasing this benefit from the “standard” 60 percent to 70 percent.

• On January 1, 2012, the Private Colleges Benefits Consortium added Delta Dental and Davis Vision to the consortium health plans. While we already had Delta Dental benefit coverage, we did not have vision coverage previously.

• The Virginia Private College Benefits Consortium reported that Bluefield College had the lowest health insurance loss ratio in 2011, of all participating institutions in our consortium health care plan. Therefore, our health insurance premiums increased only 2.5 percent for the 2012 plan year (effective January 1)—as compared to the national average increase predicted by Mercer, of 5.4 percent. (The Virginia Private College Benefits Consortium includes 12 private colleges in Virginia and renewed health insurance coverage for 2012 with Anthem Blue Cross Blue Shield.)

• LivingWell Health Solutions (of Charlotte, NC) began on-site Health Educator services in February 2012. Angela Gunther, Health Educator, will be on campus once each month to provide medical education about chronic conditions, to individual participants. She also will help establish personal health goals and provide nutritional and physical activity advice. LivingWell also provides telephonic outreach throughout the month. This health education initiative is part of the new health and wellness program that the Private Colleges Benefits Consortium rolled out effective January 1, 2012 (with initial health screenings for participants last fall).

• The human resources department continues to process new employee hires, particularly for the Bachelor of Science in Nursing program and in the admissions department.

• The human resources staff continues to work with the local SHRM (Society for Human Resource Management) chapter to provide meeting space on campus,

bringing training to our human resources staff. Students from Mrs. Dee Shoemaker’s human resources class can also attend meetings, and they often do.

• We developed a leave report for exempt employees, effective January 1, 2012, providing summary leave information to employees and their supervisors.


• The Virginia Private Colleges Benefits Consortium (part of the Council for Independent Colleges in Virginia—CICV) has selected BusinesSolver as the vendor for billing and enrollment support. As a participating college, we will be training on and working as appropriate with this system. The goals of this systems initiative are: v To enable CICV to be the primary record holder for the eligibility data of

participating colleges, including Bluefield College. v To enable CICV to provide billing administration and reconciliation services that will

allow each college’s human resources staff to access relevant data and make appropriate hire, termination, and benefit-related changes.

v To provide the ability to transfer Bluefield College eligibility data in an electronic format between CICV and its vendor partners.

v To lay the foundation for the future introduction of employee self-service applications, allowing employees to make web-based benefit selections and demographic changes on their own.

• In April 2012, human resources will send a customer service survey (combined survey for all finance and administrative areas) to faculty and staff. As in the past, the survey results will be used for institutional effectiveness reporting for human resources.

• Human resources will be updating policies and procedures for student workers and federal work-study students, perhaps in conjunction with the new one-stop shop.

• If the capital budget for 2012-13 provides the resources for the purchase of Jenzabar’s personnel module, human resources will work with IST to implement this module.

• Caroline Dixon, Business Office/Human Resources Assistant, continues to work on updating the College’s Staff Employee Handbook.

• Again this coming fall, Human Resources will develop, organize and host a staff workshop. The goals of this workshop will be to help staff appreciate more the excitement of the opening of the new academic year (similar to the faculty workshop), offer important information to staff, and express appreciation to our staff.

• In relation to various institutional strategic objectives, human resources will continue to aggregate comparative staff compensation and benefit data from various sources.

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Bookstore

Submitted by Judy Akers, Bookstore Manager Significant highlights of the last six months:

• Sales are down yet again from this time last year for our textbook department, by around 8 percent or $20,000 (as of February 29, 2012, compared to February 28, 2011). With the provision of electronic textbooks for inSPIRE students, we

have lost those sales, and more traditional students are now purchasing textbooks on line through Amazon, Half.com, and Chegg. Some students are going without textbooks, perhaps borrowing from classmates. We try to compete by continuing to conduct buybacks from our students and purchasing textbooks from wholesale companies to provide more used books, if faculty choose to use the same text from semester-to-semester or year-to-year. Students appreciate the cost savings resulting from used books. Of traditional textbooks sold, the ratio of new versus used for fiscal year 2010-11 as of February 29, 2012, is approximately 64/36 (was 58/42 in fiscal year 2010-11, 57/43 in 2009-10, and 74/26 in 2008-09). This statistic does reflect that the proportion of new text sales is up from the two most recent years, and this is mirrored in the dollar value of new text sales, which is up $26,000 (21 percent) over this time last year

• We continue to focus on enhanced display of our merchandise. In fact, clothing and miscellaneous gift sales show a 46 percent increase ($12,000) for this fiscal year as of the end of February, as compared to this point last year. The 9 percent increase in traditional student enrollment (and 11 percent increase in residential students) this year (average academic year full-time-equivalent) helps as well, as does our sale of items at football games. We are challenged, though, with carefully watching our non-text gross margins, as that margin is at its lowest point in six years. We attribute this drop-off to trying to turn our inventory more quickly—with reduced prices by as much as 75 percent. But, even if margins drop slightly, if we increase our sales volume enough, we still should be able to contribute growing profits to the College’s operating budget.

• While sales are down from this point last year, the cost of sales actually has increased by 10 percent. Between the decrease in textbook sales and the increase in clothing and miscellaneous sales, netting out the cost of sales, the gross profit percentage is running lower than at this point last year (35 percent as compared to 42 percent), and the net profit also is running lower (22 percent as compared to 31 percent). Campus store net profit dollars are lower than at this point last year as well—31 percent, or $26,000, lower.

• We continue to have sales from the campus store’s website. Find us at http://www.bluefield.edu/shop-online/. Those sales are included in the statistics quoted above. Our online sales seem to be running steady.

• The campus store has been involved with the netbook initiative related to the inSPIRE program changes. Initially, we were receiving the netbooks from the manufacturer (Dell), shipping them to the students, and transferring ownership for distributed netbooks on the Dell website. We now have moved to a voucher system, whereby we provide student names directly to Dell for new inSPIRE students, who have a few weeks in which to place their equipment order with Dell and receive a $250 credit on their order. Dell then bills the College for the $250 per student. As the College assesses the value of this incentive, we are considering elimination of this initiative next academic year.


• The next few months for the Bookstore typically are busy with returning unsold textbooks to the publishers, ordering textbooks for summer school and, preparing preliminary orders for fall semester, based on the faculty textbook adoption forms received so far.

• The campus store will continue to enhance non-textbook product offerings, to mitigate the effects of decreased textbook sales. We are trying to turn our inventory more quickly, with special sales, and are partnering with Alumni Relations, through

Josh Cline, and obtaining additional retail expertise from Kathryn Olive, to ensure that we carry marketable inventory. Inventory selections/orders currently are in process for our fall back-to-school merchandise.

• When time permits, the campus store will continue to work on utilizing the point of sale system installed two years ago. A recent visit from the system vendor (Heartland) has helped resolve some system issues, to facilitate our renewal of the system perhaps over the summer.

• In April 2012, the campus store will send a customer service survey (combined survey for all finance and administrative areas) to faculty and staff. As in the past, the survey results will be used for institutional effectiveness reporting for the campus store.

• The campus store hopes to grow gross profit to 30 percent and net profit to 13 percent for 2011-12. (Gross profits for 2008-09, 2009-10, and 2010-11 were 35 percent, 26 percent, and 28 percent, respectively. Net profits were 14 percent, 11 percent, and 12 percent for the same periods. Fiscal year profit percentages are lower than those noted above as of February, because sales slow over the next few months, while expenses of operating the campus store continue.)

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Information Services and Technology (IST)

Submitted by Steve Kessinger, Director of Information Services and Technology Significant highlights of the last six months:

• Continued migration to Live@EDU. All faculty email accounts have been migrated to Microsoft’s Live@EDU solution. Staff email migration is currently in progress and should be completed within the next month.

• Upgraded our ERP to version 4.2. Jenzabar EX 4.x contains a new, more intuitive user interface called My Workspace. My Workspace allows for more efficient operation of the software and for additional management capability.

• Began implementation of Hyper-V Server Virtualization. Server virtualization will allow IST to manage the server environment from centralized toolsets and reduce the number of physical servers. The reduction of physical servers will contribute to a more “green” infrastructure through the reduction of power consumption and cooling needs.

• Assessed critical technology needs for copier replacement, campus-wide wireless, and SMART/multimedia classrooms. The current copier hardware is approaching 9 years of age, so IST has engaged several vendors to quote new hardware/software. Quotes have been obtained, and we are exploring the options with a committee. In response to the Board of Trustee’s interest and the request from the College Leadership Team, IST has obtained a quote for implementation of campus-wide wireless ($55,000). In addition, IST has obtained quotes for the updating of 5 SMART/multimedia classrooms and for continuing the technology refresh cycle re-established during 2011-12. These capital requests are being considered in the budget planning process for 2012-13; the proposed technology refresh request is for $270,000 (including the SMART rooms).

• Implemented new security camera system for Student Activity Center (SAC). After discovering the SAC security cameras were no longer functioning, IST replaced the system with new, web-accessible cameras to help ensure student safety.

• Met with Heartland, the system vendor for the College’s OneCard system. The company sent an experienced technician to review and help resolve some ongoing issues that we had with the system’s various applications. We are following up with our own task list to totally resolve many of these issues.

• Continued service on the Jenzabar EX Advisory Board. Shortly after Steve Kessinger rotated off of the Advisory Board, Chip Lambert was selected to join the Board. Jenzabar EX is the College’s administrative computing system. In his role on the Board, Chip represents Jenzabar’s EX users as well as Bluefield College. The EX Advisory Board focuses on product direction, partnership identification, support, service, training, and other business issues.


• Perform a complete technology audit to assess all technology in relation to device lifecycle, purpose, and capacity for faculty/staff/students to perform day-to-day activities. A report on status and technology needs will be delivered to the Leadership Team upon conclusion.

• Utilize COBIT and audit assessments for development of best practices for Information Services at Bluefield College.

• Implement new backup solution in order to avoid institutional disaster in the event data is lost or a crisis occurs. Once the server virtualization project has concluded, IST will engage vendors and implement a new backup solution that will not only protect our data on-premise but allow us to maintain an off-site backup in the cloud. The implementation of such a solution will enhance our compliance with auditing requirements and other standards.

• Enhance the college’s technology infrastructure through replacement of copiers, addition of campus-wide wireless, and continued implementation of the technology refresh plan. These initiatives are critical, as aging and failing equipment continue to affect the effectiveness of our administrative and academic areas.

• Add security camera system to the Science Center in order to ensure the protection of the computer labs, 1st floor hallways, and the alcove where a student-use copier/printer will likely be installed.

• Send a customer service survey in April 2012 (combined survey for all finance and administrative areas) to faculty and staff. As in the past, the survey results will be used for institutional effectiveness reporting for IST.

• Attend the Jenzabar Annual Meeting (JAM) conference in May in Dallas. Steve Kessinger and Chip Lambert will attend this conference.

* * * * * * * * * * * * * * *

Food Service Submitted by Jenny Phillips, Food Service Director (Valley Services, Inc.)

Significant highlights of the last six months:

• Since the “Grand Reveal” of the dining hall renovation in August, Valley has served close to 83,000 meals. (Valley Services, Inc., the College’s food service provider, invested $250,000 toward this $285,000 project. This investment will “vest” to the College after five years, “amortized” using a straight-line method. In addition to

significant improvement in the overall appearance and layout of the dining hall, seating capacity was increased to 258, a 10 percent increase.)

• Valley has participated with David Taylor and a student committee to hear concerns and evaluate options for meal plans, food options, and general feedback regarding the food service operation.


• During the summer, food services will provide meals (as reserved) for the various camps and volunteer workers (first floor Alumni Hall project) on campus.

• Food services is working on developing optional meal plans, in addition to the current basic 19-meal plan.

• Valley is compiling a nutritional book for student access for all meals prepared on the Café Classics line.

• Valley is designing more signage to mark food choices. • Food services is evaluating offering more options on the Garden Club and Deli

Depot Lines. • Food services will continue to focus on increasing cash sales at the Starbuck’s kiosk

and in the dining hall. Target markets will include faculty and staff, as well as external customers. Programs such as The Coffee House at the Quick Shott Café and Sunday Brunch menu favorites will continue to be a part of this marketing effort.

• As always, Valley will issue a spring survey to ensure that they are meeting the students’ needs and expectations.

Bluefield College

Board of Trustee Committee Meeting Minutes Name of Committee: Finance Committee Date of meeting: Thursday, October 13, 2011 Committee members attending: Administrators Present: Mr. J. Ronald Hypes, Chair, Presiding David Olive — ex officio Mr. Stephen G. Layfield Mrs. Sarah A. Beamer — ex officio Mr. Ken Russell Mrs. Julie Johnson, Board Chair Dr. Robert Boozer — Faculty Representative Ms. Katilyn Duggins — Student Representative Committee members absent: Guests Present (during audit discussion): Mr. Bill Evans Mr. David Snyder — Brown, Edwards (auditor) Mr. Bob Houck Mrs. Tricia Smith— Brown, Edwards (auditor) Reference Materials (copies included with file copy of minutes): à Audited financial statements and audit management letter as of June 30, 2011—including

resolution à Report to the Finance Committee of the Board of Trustees, October 13, 2011 (PowerPoint

slide booklet by Brown, Edwards & Company, L.L.P.) à Interim managerial financial statements as of September 30, 2011—including unaudited

condensed balance sheet, unaudited operating income statement, internal notes/comments, operating cash account balance trend, students accounts receivable aging report, and investment analysis (all items internally prepared)

à Tuition and fee history, including proposed tuition and fee rates for fiscal year 2012-13 (internally-prepared)—including resolutions

à Statement of Endowment Investment & Spending Policy, Objectives & Guidelines, October 2011 (internally prepared)

à VPFA’s handout for introduction to new members of the Board of Trustees (internally prepared)

Discussion:

1. Mr. Hypes called the meeting to order at 3:05 p.m.

2. Mr. Russell offered the opening prayer.

3. Minutes from the following meetings were approved: April 15, 2011; August 22, 2011; and September 21, 2011. (Mr. Layfield moved, and Mr. Russell seconded; passed unanimously.)

4. Mrs. Beamer noted that the College’s 990 information tax return was due to be filed with the Internal Revenue Service by November 15, 2011. Mrs. Beamer explained that requirements specify that the 990 should be reviewed by the Board prior to its filing. She reminded the Committee that they had agreed to serve as the Board’s “review panel.” Mrs. Beamer noted to the Committee that she would forward the return to Committee members as soon as she received the draft from Brown, Edwards—prior to filing it. [Subsequent to the meeting, the Committee did review the 990, and the return was filed on November 10, 2011.]

5. Discussion occurred regarding the College’s interim managerial financial statements as

of September 30, 2011, and the College’s current cash position. The cash level remains strong, at $2.3 million. No borrowings have occurred on the College’s line of credit.

6. Mr. Hypes reminded the Committee that, typically at the fall meeting, the Committee

and Board approve a revised budget for the current year. Mr. Hypes explained that members of the College Leadership Team had met with Board leadership to describe the continuing start-up nature of the new inSPIRE program model, initiated in August, and the challenges in projecting enrollment under the new model. Board leadership had suggested that, in this case, a revised budget not be entertained. The College will continue operating under the preliminary 2011-12 budget approved by the Board at the April 2011 meeting, with updated projections calculated and brought to the Board’s attention throughout the year, as necessary.

7. Mr. Layfield reminded the Committee that they had approved the revised Statement of

Endowment Investment & Spending Policy, Objectives & Guidelines, earlier in the fall and the full Board would receive the policy for approval at their meeting the following day.

8. Dr. Olive updated the Committee on new initiatives:

a. Student resident townhouses: The Facilities Committee reviewed the layout at their meeting earlier today and suggested revisions to the site plan. Planning work will continue, and the College will more formally begin pursuing financing with the USDA (preliminary application, etc.—no commitments).

b. Campus Community Wellness Center: The fundraising stage is ready to get moving full force for phase one.

c. Intersection of College Avenue and Stadium Drive: Dr. Olive is negotiating the sale of the related College property at a minimum price of $63,000, as directed by the Board (appraisal was $13,000). The College would be selling the property to Tazewell County’s IDA (who would fund the purchase by selling their old road portion). (The rationale for the relocation of the intersection is to move the current intersection to a safer area.)

d. One-stop shop: College Leadership is planning to combine the offices of student accounts, financial aid, and registration, into a single office. The most likely space identified to be renovated to accommodate this arrangement is to expand the current registrar’s office west into the existing Board Room. The Board Room then would relocate to the current financial aid area. Planning will continue on this initiative, to renovate as necessary in summer 2012.

9. Dr. Olive offered the closing prayer.

10. Mr. Hypes adjourned the meeting at 4:47 p.m.

Actions taken:

1. The financial statement audit for fiscal year 2010-11 was received by resolution to be made a part of the official record of the College’s Board of Trustees. (Mr. Russell moved, and Mr. Layfield seconded; passed unanimously.) Mr. Snyder and Mrs. Smith, representatives from Brown, Edwards, reviewed with the Committee the audited financial statements, management letter, and their PowerPoint/handout. As a matter of routine, the auditors spent some private time with the Committee, while members of administration and the faculty and student representatives left the room. Mr. Hypes noted that no problems were revealed during this time.

2. The proposed tuition rates for fiscal year 2012-13 were approved. (Mr. Layfield moved,

and Mr. Russell seconded; passed unanimously.) The traditional student tuition increase is 5 percent, the traditional student room and board increase is 3 percent, and the inSpire/e-Spire tuition increase is 3 percent (from the rate for 2011-12 as reduced by Board approval in June 2011).

2/29/2012 12/31/2011 6/30/2011 2/28/2011Actual Actual Audit Actual

AssetsCash and Cash Equivalents & Bond Reserve 2,429,415 515,660 1,239,552 2,544,992 Student, Grant & Other Receivables, less Allowance for Doubtful Accts of $231,766 ($188,562 on 2/28/11) 610,253 17,731 254,439 Allowance adjusted quarterly. 570,882 Inventories and Supplies 112,503 112,503 130,329 Adjusted semi-annually. 152,803 Prepaid Expenses 104,879 103,260 146,189 65,399 Contributions Receivable 420,564 420,564 285,203 Adjusted quarterly. 230,897 Investments 5,532,257 5,258,989 5,182,909 5,348,412 Deferred Loan Costs, net of Accumulated Amortization 30,375 30,375 30,375 Adjusted annually. 31,174 Land Held for Resale/Investment 68,988 68,988 68,988 68,988 Land, Buildings, and Equipment (net depreciation) 10,621,593 10,653,115 10,444,479 10,444,880 Funds Held in Trust by Others 143,044 143,044 142,094 Adjusted quarterly. 138,081 Total Assets 20,073,871 17,324,228 17,924,557 19,596,509

Liabilities and Net AssetsLiabilitiesAccounts Payable and Accrued Liabilities 264,890 43,639 440,801 349,833 Student and Other Deposits 53,720 57,185 183,569 46,075 Student Payments for Upcoming Spring Semester - 33,401 - - Deferred Revenue 2,550,145 115,797 201,108 (a) 2,182,451 Accrued Compensation and Other Benefits 270,513 187,102 216,767 253,961 Amounts Held on Behalf of Others 115,763 83,056 50,667 134,168 Trust and Annuity Obligations 93,387 106,252 107,115 Adjusted quarterly. 79,575 Postretirement Benefit Obligations 398,626 398,626 398,626 Adjusted annually. 388,349 Line of Credit - - - - Debt 6,141,519 6,153,758 6,589,906 6,570,025 Capitalized Lease Obligations - - 31,169 51,085 Total Liabilities 9,888,564 7,178,816 8,219,728 10,055,521

Total Net Assets 10,185,308 10,145,412 9,704,829 (b) 9,540,988

Total Liabilities and Net Assets 20,073,871 17,324,228 17,924,557 19,596,509

NOTE REGARDING NON-GAAP PRESENTATION:

The interim balance sheets (02/29/12, 12/31/11, and 02/28/11) are not in accordance with GAAP. In particular, permanently restricted activity is not reflected, nor is non-operating activity (such as unrealized investment activity and restricted contributions). However, expense accruals, deferred revenue adjustments, and reclasses were made on the interim financial statements.

(a) Deferred tuition revenue represents the portion of tuition revenue from that collected at the beginning of the semester for the remaining portion of the semester at the balance sheet date. Bluefield College collects tuition at the beginning of each semester, as is industry practice.

(b) The net of the deferral/accrual adjustments runs through net assets (through the income statement).

NOTE REGARDING OTHER AREAS NOT ADJUSTED:

The other areas for which adjustments are made only at quarter or year end typically affect balances immaterially. The exception to this is in investments and funds held in trust, where market values may vary significantly between periods presented. Investment amounts presented here have been adjusted.

Bluefield CollegeManagerial Condensed Balance Sheet (UNAUDITED)

February 29, 2012(Trial Balance Date 3/8/2012)

Report Completed by: Amy B. Ellison, Controller, March 10, 2012

2/29/2012 12/31/2011 2011-2012(67% of fiscal year) (50% of fiscal year) Current

Actual % of Actual % of Budget 2/28/2011$s Bdgt $s Bdgt $s Actual

Operating IncomeTraditional Tuition & Fees 6,368,920 69% 4,639,494 50% 9,197,800 5,455,044 inSPIRE & AGEO Tuition & Fees 1,399,254 32% 1,054,553 24% 4,439,830 2,044,796 Fundraising Income 420,913 46% 367,427 40% 917,564 217,902 Private Grants - Appalachian College Association - N/A - N/A - - Private Grants - RHEP - Virginia Tobacco Commission 51,949 N/A - N/A - 10,853 Loan Forgiveness 400,000 N/A 400,000 N/A - 400,000 Unrestricted Endowment Income 100,000 87% 100,000 87% 115,000 - Interest Income 1,286 43% 833 28% 3,000 2,475 Residence Hall Income 679,105 71% 497,869 52% 958,160 594,278 Food Service Income 953,315 73% 697,500 53% 1,310,000 818,155 Campus Store Income 269,344 91% 174,560 59% 296,500 275,812 Special Events Income 65,277 85% 63,277 83% 76,500 45,584 Fine Arts Community School 16,640 67% 11,295 45% 25,000 17,558 Rental Property 10,000 77% 7,500 58% 13,000 10,950 Miscellaneous Income 350 4% 275 3% 10,000 4,326 Federal Program Administrative Allowance 290 4% 290 4% 6,500 7,306 Parking Fees & Fines - 0% - 0% 5,000 12,146 Transcript Fees 4,215 105% 3,291 82% 4,000 3,647 Total Operating Income 10,740,857 62% 8,018,164 46% 17,377,854 9,920,832

Operating ExpensesInstruction & Academic Support 450,820 52% 374,024 43% 869,838 529,037 Student Services 1,050,152 91% 881,166 77% 1,149,203 654,996 Institutional Support 551,495 65% 427,366 50% 854,133 504,204 Bad Debt Expense - 0% - 0% 50,000 - Depreciation Expense 500,000 69% 375,000 52% 724,000 457,667 Interest Expense 190,533 61% 144,468 46% 311,500 190,037 Maintenance 660,737 64% 423,257 41% 1,038,213 597,716 Auxiliary 835,926 70% 598,863 50% 1,198,595 721,292 Salaries 3,584,975 62% 2,638,778 46% 5,746,961 3,096,753 Employee Benefits 785,103 51% 555,355 36% 1,552,158 700,769 Unfunded Scholarships 2,473,594 61% 1,783,953 44% 4,043,323 2,145,442 Reduction of Expenditures for Release of Restrictions (125,153) 75% (115,825) 69% (167,000) (186,132) Total Operating Expenses 10,958,182 63% 8,086,404 47% 17,370,924 9,411,779

Net Unrestricted Operating Income/(Loss) per G/L Fund 1 (217,325) N/A (68,240) N/A 6,930 509,053


This income statement is not in accordance with GAAP. In particular, permanently restricted activity is not reflected, nor is non-operating activity (such as unrealized investment activity and restricted contributions). However, most expense accruals and deferred revenue adjustments were made on the financials at 02/29/12, 12/31/11, and 02/28/11. The other areas for which adjustments are made only at quarter or fiscal year end typically affect balances immaterially or affect non-operating and/or temporarily or permanently restricted activity, which is not reflected in the income statement operating measure of performance.

For the Eight-Month Period Ended, 2/29/2012 (Trial Balance Date 3/8/2012)Report Completed by: Amy B. Ellison, Controller, March 10, 2012

Bluefield CollegeManagerial Unrestricted Operating Income Statement (UNAUDITED)

BLUEFIELD COLLEGE Internal Notes/Comments regarding Interim Unaudited Managerial Financial

Statements February 29, 2012

Completed by: Amy B. Ellison, Controller Unaudited Statements of Financial Position (Balance Sheet)

1. Cash and cash equivalents – increase from December 31 to February 29 primarily from cash receipts as the spring semester began in January; decrease from June 30 to December 31, as fall semester expenditures continued, while the bulk of semester cash was received at the beginning of the fall semester; bond reserve represents the cash balance in the USDA debt service account ($87,885 at 02/29/12 and $59,535 at 02/28/11)

2. Student, grant and other receivables – increase from December 31 to February 29 primarily from charges to student accounts as the spring semester began; decrease from June 30 to December 31, as TuitionPay account payments continued to be made on accounts throughout the fall semester; increase from one year ago because more federal loan funds were pending as compared to last year; note that payments received for tuition for the spring 2012 semester in December have been reclassified from negative receivables to the liability line titled “student payments for upcoming spring semester”

3. Inventories and supplies – adjusted semi-annually at June 30 and December 31; decrease from June 30 to December 31 due to campus store sales in the fall semester and the campus store has not been carrying the core inSPIRE books because these books are now provided by e-texts which are not purchased through the campus store

4. Prepaid expenses – decrease from June 30 to December 31 as prepaids for the fiscal year or academic semester/year are expensed during the course of the fiscal year; most prepaid expenses are for commercial insurance; software support on the College’s administrative computing system—Jenzabar; library databases; netbooks for inSPIRE students; and significant institutional memberships and dues; increase from December 31 to February 29, as prepaids are usually paid at the beginning of the calendar year (January) or fiscal year (June); the increase in prepaids between February 2011 and February 2012 results primarily from the netbook costs for online inSPIRE students—this cost for each cohort will be expensed over 12 months, the approximate length of the core inSPIRE program; additional prepaid items in the February 2012 balance include the athletic recruiting Scoutware software, some additional library databases, and the campus elevator service contract

5. Contributions receivable – adjusted quarterly; increase between June 30 and December 31/February 29 as new pledges have been made and recorded; the majority of these new pledges are for the student wellness center; increase from one year ago due to new pledges made and recorded throughout the year

6. Investments – increase from June 30 to February 29 as a result of market fluctuations, and from a stock gift received in the amount of $300,000 in October for the Alvah Vernon and Bertha Mae Sproles endowed scholarship fund, and $120,000 was transferred from temporarily restricted Whitmore scholarships funds to Whitmore endowed scholarship funds ($40,000 at 7/31/11, $40,000 at 8/31/11, and $40,000 at 9/30/11)—at the donor’s request; all periods presented include the balance of the Raymond James gifted annuity account (which is not included on the separate College-held investments schedule); also payout of $100,000 was drawn in December

7. Deferred loan costs – includes USDA closing costs (primarily legal); will be adjusted next

at fiscal year-end, 6/30/12 8. Land held for resale/investment – no change (represents lots gifted to the College, in the

Chinquapin area of Bluefield, located behind Graham High School) 9. Land, buildings and equipment – increase between June 30 and December 31 mainly

from the dining hall and student activity center renovations in Shott Hall, as well as summer sidewalk work, boiler repairs, and the purchase of technology refresh items (lab PCs and network switches); decrease between December 31 and February 29 due to depreciation

10. Funds held in trust by others – increase between June 30 and February 29 from quarterly adjustments (market value changes affect the present value of expected future cash flows from trusts)

11. Accounts payable and accrued liabilities – includes $15,425 of interest accrual on USDA financing at June 30, December 31, and February 29 (principal and interest payments are made monthly—mid-month, so a one-half month accrual exists at each month end); also fluctuates based on when month-end falls relative to the College’s weekly accounts payable process; significant payables were due at June 30 related to the various summer facilities projects; decrease between June 30 and December 31, as the college closed for the holiday from December 22 through January 1, so payables for payroll taxes, benefits, etc., for December were paid before the holiday break began

12. Student and other deposits – decrease from June 30 to February 29 as the traditional fall semester began and deposits were applied to student accounts

13. Student payments for upcoming spring semester – this amount is shown only at December 31 and represents payments received for tuition for the spring 2012 semester in December; this amount has been reclassified from negative receivables to this liability line; these payments went back to accounts receivable when spring semester charges were processed at the beginning of spring semester

14. Deferred revenue – decrease from June 30 to December 31, as the traditional semester and the inSPIRE fall term one began in August and ended in December; increase from December 31 to February 29, as the traditional spring semester and the inSPIRE term one spring semester began in January, and the AGEO courses began in January and continued in February; the inSPIRE fall term two began in October and continued in February; deferral is recognized for the portion of tuition revenue from that collected at the beginning of the semester for the remaining portion of the semester at the balance sheet date

15. Accrued compensation – decrease from June 30 to December 31 and increase from December 31 to February 29; the main items in accrued compensation are vacation accrual and faculty contract accrual; vacation accrues throughout the calendar year and reduces as it is taken (staff can only carry over 5 vacation days at December 31); faculty contracts are paid out by August, before a new contract year begins, and then, after August, the faculty contract accrual begins to increase until the following August (while faculty work a 10-month contract, the College pays them over 12 months—therefore, an accrual builds each month until final payment for the contract year in August)

16. Amounts held on behalf of others – increase from June 30 to February 29 primarily from receipt of student activity fees which will be used by various student organizations over the academic year; increase from June 30 also resulting from the receipt of “money-making” funds by various athletic teams, such as teams working at the Bristol Motor Speedway

17. Trust and annuity obligations – all of the quarterly annuity payments were pulled from trust and annuity obligations into accounts payable in January and February 2012 for the entire 2012 calendar year; the main difference between the 2/28/11 balance and the 2/29/12 balance is the fiscal year end adjustment that was made at 06/30/11

18. Postretirement benefit obligations – no change (adjusted at fiscal year-end based on an actuarial review)

19. Line of Credit – no borrowings have occurred on the line of credit during this fiscal year or since June 2009

20. Debt – decrease since June 30 due to monthly payments made on debt; debt is mainly comprised of USDA financing and the College bus financing ($13,534 at February 29, 2012 and $22,998 at February 29, 2011); the forgivable loan from a private foundation was completely forgiven in December 2011, leaving a zero balance due

21. Capitalized lease obligations – decrease from June 30 to February 29 because the capitalized leases were paid in full in December 2011, leaving a zero balance due; these leases were primarily for technology equipment for Jenzabar; replacement equipment currently is being purchased outright with capital funds (funded depreciation)

22. Total net assets – fluctuates primarily from investment gains/losses (however, relative to the income statement, investment gains are not reflected in unrestricted operating activity but in non-operating activity—which is not reflected on the managerial interim income statement, so the unrestricted surplus will not include investment gains)

Unaudited Statements of Activities (Income Statement)

1. Tuition and fees (including residence hall and food service income) – the College

collects tuition and fees at the beginning of each semester (for traditional and inSPIRE students), but must defer the portion of tuition revenue from that collected at the beginning of the semester for the remaining portion of the semester at the balance sheet date; increase from December 31 to February 29 as a new semester has begun (the traditional fall semester and the inSPIRE fall term one began in August and ended in December, and the inSPIRE term two began in October and continued in February; the traditional spring semester and the inSPIRE spring term one began in January; also AGEO courses began in January and continued in February); the low percent of budget for inSPIRE and AGEO revenue reflects the lower than budgeted enrollment numbers in the new August and October cohorts (210 new inSPIRE students were budgeted for fall 2011 and 95 for spring 2012 in the spring budget, based on the previous fall and spring start models; new inSPIRE enrollments for August and October were 59 each, and the new inSPIRE enrollment for January was 56); the low percentage of budget for the inSPIRE and AGEO revenue line also reflects the reduction in tuition price for these courses, after the preliminary spring budget was approved

2. Fundraising income – cyclical, with high revenue points in December and June 3. Private Grants – ACA – The College has received several grants (mainly related to

academic programming) from the Appalachian College Association; revenue will be recognized as the funds are spent; RHEP – Virginia Tobacco Commission – represents the amount spent of funds received from the Virginia Tobacco Commission Grant for the Rural Healthcare Education Program (RHEP)

4. Loan Forgiveness - represents the gift of loan forgiveness by a private foundation; amount of loan in June 2009 was $1 million, $200,000 was forgiven in fiscal year 2009-10 ; $400,000 was forgiven in fiscal year 2010-11 by December 31, 2010; $400,000 was forgiven in fiscal year 2011-12 in December 2011; since loan forgiveness is for a cash inflow that occurred previously (spring 2009), this income item does not result in current cash flow

5. Unrestricted endowment income – fiscal year payout will be pulled out in two draws, one in December and one in May; this item represents only the unrestricted portion of the endowment payout; the $100,000 December draw represents 87 % of the

unrestricted portion of the payout; last January the College had not pulled down endowment spending, because operating cash flow was stronger than this year

6. Interest income – generated on College's cash sweep account with First Century Bank; the February 2012 interest rate is .15% and the February 2011 interest rate was .15% as well; as cash flow continues to become more stable, the College may begin to invest operating cash short term in some money market funds paying higher interest rates

7. Campus store income – amount expected at this time of year, which is 91% of the budgeted amount

8. Special events income – primarily summer program revenue; current amount earned is for July and August 2011, with remainder to be earned in May and June of 2012; increase from one year ago due to the timing (which specific weeks) these special events take place during the summer months and the volume of participants

9. Parking fees and fines – the College no longer charges a comprehensive or parking fee for students; this account will accrue income only as parking violation fines are charged to students throughout the year (typically hitting student accounts toward the end of each semester); last year (during 2010-2011) $25 per full-time student was transferred into this account from the traditional comprehensive fee account, to represent the academic year parking fee for each student—this practice has been discontinued since the parking fee has been eliminated

10. Other income categories – immaterial or amount as expected as of February 29; 67% of the fiscal year has transpired at February 29 and around 77% of the academic year has transpired (23 weeks divided by 30 academic-year weeks); miscellaneous income includes small amounts for vending machine commissions and student confirmation fee write-offs

11. Various expense categories – amount as expected for this point in the fiscal or academic year (approximately 63% spent as of February 29 is considered reasonable);

12. Student services has spent 91% of budget and $395,156 more than last February due to equipment costs of $243,694 mainly for the football program

13. Bad debt expense – significant analysis of accounts receivable for write-offs will occur at the end of the fiscal year (June 30); however, the allowance for bad debts is reviewed quarterly and adjusted if needed; at February 29, the allowance as adjusted at last June 30 is adequate

14. Unfunded scholarships – as with tuition, the College recognizes only the portion of scholarship expense that matches the portion of the semester passed as of the balance sheet date; the traditional fall semester began in August and ended in December, and the traditional spring semester began in January; unfunded financial aid is running below budget, so budget savings are expected from this category

15. Reduction of expenditures for release of restrictions – actual represents offsetting account for capitalization of fixed assets purchased with departmental operating budget funds and gifted funds used to subsidize the nursing and football budgets; the budget represents gifted funds anticipated to be used to subsidize the nursing and football budgets

Summary Notes Regarding Fiscal Year 2011-12 Operations Through February 29, 2012

The primary reason for the significant decrease in net unrestricted operating income (the swing from a surplus to a deficit) between last February and this February is the drop-off in the inSPIRE enrollment, along with the reduction in tuition price for the inSPIRE and AGEO courses and the new costs of the inSPIRE program (netbooks and e-texts).

February 29, 2012Description 0-‐30 31-‐60 61-‐90 91-‐120 121-‐360 Over 361 Total

With collection agency (*) 0.00 0.00 0.00 13,806.52 19,397.39 131,457.35 164,661.26 21%Current traditional 3,756.17 312,292.35 (1,055.00) (10,186.75) 5,062.42 751.00 310,620.19 40%Current adult (46,115.18) 133,402.07 (9,966.00) (3,900.00) 16,789.90 2,668.00 92,878.79 12%Former non-‐traditional (5,209.00) 13,090.00 2,580.00 0.00 42,939.31 40,497.64 93,897.95 12%Former traditional 2,931.35 31,218.55 627.70 4,241.95 37,462.40 31,205.21 107,687.16 14%Total at February 29, 2012 (44,636.66) 490,002.97 (7,813.30) 3,961.72 121,651.42 206,579.20 769,745.35 100%

-‐5.80% 63.66% -‐1.02% 0.51% 15.80% 26.84% 100.00%

February 29, 2012Description 0-‐30 31-‐60 61-‐90 91-‐120 121-‐360 Over 361 Total

With collection agency (*) 0.00 0.00 0.00 13,806.52 19,397.39 131,457.35 164,661.26 15%Current traditional 22,518.58 347,864.15 0.00 0.00 14,322.42 751.00 385,456.15 36%Current adult 14,828.88 230,435.77 0.00 0.00 18,756.00 2,668.00 266,688.65 25%Former non-‐traditional 2,125.00 16,300.00 2,605.00 0.00 53,823.62 59,535.58 134,389.20 13%Former traditional 3,374.35 31,218.55 742.70 4,291.95 44,890.32 38,877.85 123,395.72 11%Total at February 29, 2012 42,846.81 625,818.47 3,347.70 18,098.47 151,189.75 233,289.78 1,074,590.98 100%

3.99% 58.24% 0.31% 1.68% 14.07% 21.71% 100.00%(*) The College typically sends accounts to collections after no activity of 90 days. While the system-‐generated aging report begins to age these accounts as new again, the amounts shown above reflect the actual last date of activity -‐ -‐ not the date the account was submitted to the collection agency.

0-‐360 Days 841,301.20 10% 84,130.12 Over 361 Days 233,289.78 100% 233,289.78

Total Allowance 317,419.90 Unadjusted G/L 231,766.25 Entry Amount 85,653.65

Note: Current allowance of $231,766, does not need adjusted at 02/29/12. At interim periods during the course of the academic year, those accounts in the 0-‐30 days typically are very strong accounts, since many students take advantage of TuitionPay, allowing them to finance their tuition and fees over the course of the semester or year.

Allowance for Doubtful Accounts Calculation at 02/29/12

Age of Student Account (Days) with credit balances

Age of Student Account (Days) without credit balances

Bluefield CollegeStudent Account Receivables Aging Report

Report ending February 29, 2012

Swingin Net Cash

1-1-00000-001 1-2-00000-090 Net 1-1-00000-001 1-2-00000-090 Net from 2008-09Cash Line of Credit College Cash Cash Line of Credit College Cash to 2009-10

July 31 $304,661.80 ($600,000.00) ($295,338.20) $377,272.34 $0.00 $377,272.34 $672,610.54August 31 $784,984.78 ($600,000.00) $184,984.78 $459,749.93 $0.00 $459,749.93 $274,765.15

September 30 $812,694.39 ($400,000.00) $412,694.39 $1,918,473.27 $0.00 $1,918,473.27 $1,505,778.88October 31 $294,684.71 ($400,000.00) ($105,315.29) $1,394,723.17 $0.00 $1,394,723.17 $1,500,038.46

November 30 ($11,870.54) ($1,110,000.00) ($1,121,870.54) $1,035,737.99 $0.00 $1,035,737.99 $2,157,608.53December 31 $100,099.82 ($1,865,000.00) ($1,764,900.18) $624,958.28 $0.00 $624,958.28 $2,389,858.46

January 31 $1,381,416.42 ($1,865,000.00) ($483,583.58) $1,963,972.21 $0.00 $1,963,972.21 $2,447,555.79February 28-29 $731,533.19 ($1,765,000.00) ($1,033,466.81) $2,240,042.60 $0.00 $2,240,042.60 $3,273,509.41

March 31 $326,412.23 ($2,000,000.00) ($1,673,587.77) $1,700,546.39 $0.00 $1,700,546.39 $3,374,134.16April 30 $507,638.01 ($2,000,000.00) ($1,492,361.99) $976,441.33 $0.00 $976,441.33 $2,468,803.32May 31 $664,271.05 ($2,000,000.00) ($1,335,728.95) $781,442.91 $0.00 $781,442.91 $2,117,171.86June 30 $723,271.76 $0.00 $723,271.76 $1,359,988.15 $0.00 $1,359,988.15 $636,716.39

Swingin Net Cash

1-1-00000-001 1-2-00000-090 Net from 2009-10Cash Line of Credit College Cash to 2010-11

July 31 $686,237.35 $0.00 $686,237.35 $308,965.01August 31 $1,270,058.14 $0.00 $1,270,058.14 $810,308.21

September 30 $2,284,964.86 $0.00 $2,284,964.86 $366,491.59October 31 $1,886,866.04 $0.00 $1,886,866.04 $492,142.87

November 30 $1,361,282.00 $0.00 $1,361,282.00 $325,544.01December 31 $873,785.53 $0.00 $873,785.53 $248,827.25

January 31 $2,477,507.29 $0.00 $2,477,507.29 $513,535.08February 28-29 $2,483,046.48 $0.00 $2,483,046.48 $243,003.88

March 31 $1,886,115.77 $0.00 $1,886,115.77 $185,569.38April 30 $1,394,385.08 $0.00 $1,394,385.08 $417,943.75May 31 $852,588.56 $0.00 $852,588.56 $71,145.65June 30 $1,166,265.89 $0.00 $1,166,265.89 ($193,722.26)

Swingin Net Cash


July 31 $547,952.60 $0.00 $547,952.60 ($138,284.75)August 31 $868,478.82 $0.00 $868,478.82 ($401,579.32)

September 30 $2,409,197.59 $0.00 $2,409,197.59 $124,232.73October 31 $1,474,701.67 $0.00 $1,474,701.67 ($412,164.37)

November 30 $620,728.74 $0.00 $620,728.74 ($740,553.26)December 31 $425,363.82 $0.00 $425,363.82 ($448,421.71)

January 31 $3,089,842.70 $0.00 $3,089,842.70 $612,335.41February 28-29 $2,339,120.43 $0.00 $2,339,120.43 ($143,926.05)

NOTE: As of March 31, 2009, the College had expended just over $1 million of operating funds toward the East River Hall project,pending closing in June 2009 on the USDA financing. Also, during the period April-June 2009, the College convertedthe $2 million of borrowings on the prior credit line to $1 million in long-term financing, through the USDA borrowing,and the other $1 million to an on-demand forgivable loan through a private foundation. $200,000 of the forgivableloan was forgiven in December 2009, $200,000 in September 2010, $200,000 in December 2011, and the remaining $400,000 was forgiven in December 2011.

2011-12

Bluefield College

2010-11

Operating Cash Account Balance TrendPrepared By: Sarah A. Beamer, Vice President for Finance and Administration

2008-09 2009-10

February 29, 2012 Raymond James Raymond James Morgan Stanley Restricted Shelton Wells Fargo Smith Barney Total Breakdown

Cash & equivalent 158,006.79 6,129.63 - 141,281.36 305,417.78 5.71%Preferred Equity - - - 425,705.50 425,705.50 7.96%Domestic Equity 1,359,966.60 - 540,325.75 662,180.75 2,562,473.10 47.94%Global Equity - - 529,207.21 - 529,207.21 9.90%Emerging Markets Equity - - 71,056.98 - 71,056.98 1.33%Real Estate/Mtg-Asset Backed - - 55,790.23 9,780.56 65,570.79 1.23%Corp Bonds/Govt Securities/CD's 557,919.20 43,973.25 566,769.95 137,786.80 1,306,449.20 24.44%Global Bond 79,134.27 - - - 79,134.27 1.48%Total Market Value 2,155,026.86 50,102.88 1,763,150.12 1,376,734.97 5,345,014.83 100.00%

3-Month Return at 12/31/11 9.41% 1.55% 5.18% 4.60% 6.70%6-Month Return at 12/31/11 4.29% 2.92% -7.52% -4.10% -1.78%9-Month Return at 12/31/11 6.05% 5.02% -7.14% -2.20% -0.44%1-Year Return at 12/31/11 10.00% 6.22% -3.74% 1.80% 3.32%3-Year Net, Total Rate Return at 12/31/11 40.73% 19.27% 3.12% * 14.30% 21.31%5-Year Net, Total Rate Return at 12/31/11 13.58% 31.53% 3.41% * 3.20% 7.72%

* Wells Fargo has only been in the Pathway's managed program for approximately 2 years. The return rates for 3 and 5 years are performance numbers for informational purposes only.

$ % Minimum Max PreferredEquity 3,588,442.79 67.14% 40% 90% 70%Fixed Income 1,451,154.26 27.15% 10% 60% 30%Cash 305,417.78 5.71% - - -

5,345,014.83 100.00%

June 30, 2011 Raymond James Raymond James Morgan Stanley Restricted Shelton Wells Fargo Smith Barney Total Breakdown

Cash & equivalent 35,848.68 6,127.35 276.70 110,502.18 152,754.91 3.06%Preferred Equity - - - 416,512.80 416,512.80 8.34%Domestic Equity 1,262,913.87 - 547,736.16 632,695.35 2,443,345.38 48.91%Global Equity - - 553,680.71 - 553,680.71 11.08%Emerging Markets Equity - - 74,661.48 - 74,661.48 1.49%Real Estate/Mtg-Asset Backed - - 57,386.75 11,684.46 69,071.21 1.38%Corp Bonds/Govt Securities/CD's 470,568.11 42,564.01 543,665.36 150,653.32 1,207,450.80 24.17%Global Bond 78,614.85 - - - 78,614.85 1.57%Total Market Value 1,847,945.51 48,691.36 1,777,407.16 1,322,048.11 4,996,092.14 100.00%

3-Month Return at 06/30/11 1.67% 2.05% 0.31% 2.64% 1.45%6-Month Return at 06/30/11 5.48% 3.11% 3.73% 5.90% 4.95%9-Month Return at 06/30/11 11.99% 3.44% 9.54% 11.00% 10.77%1-Year Return at 06/30/11 21.51% 3.18% 19.75% 23.00% 21.10%3-Year Net, Total Rate Return at 06/30/11 6.22% 18.77% 3.79% * 7.30% 5.76%5-Year Net, Total Rate Return at 06/30/11 19.24% 33.60% 4.01% * 7.00% 10.72%



4,996,092.14 100.00%

4,996,092.14 549,525.46

(100,000.00) (100,602.77)

Investments at February 29, 2012 5,345,014.83

Prepared by: Amy B. Ellison, Controller, 03/11/12

Total Allocation Allocations per Investment Policy

Growth and return

Bluefield CollegeInvestment Analsysis & Allocation by Type and Manager

February 29, 2012

Investments at June 30, 2011New deposits/gifts

Withdrawals from Spending Policy


RESOLUTION

Whereas, preparation of the annual operating budget is one of the most important duties of the College’s administration, And whereas, approval of the annual operating budget is one of the most important duties of the College’s Board of Trustees, And whereas, the annual operating budget is one of the most important financial planning and management tools available to the College, And whereas, the Finance Committee of the Board of Trustees has received and studied the proposed preliminary budget for the 2012-2013 fiscal year, And whereas, the Board of Trustees has received a copy of the proposed preliminary budget for the 2012-2013 fiscal year, Therefore, be it resolved, upon the recommendation of the Finance Committee and the administration of the College, that the annual preliminary budget for the 2012-2013 fiscal year (July 1, 2012 through June 30, 2013) be adopted. Recommended by the Finance Committee ________________________________________ Ronald Hypes, Chair ________________________________________ Julie H. Johnson, Chair, Board of Trustees

April 21, 2012

3/31/2012 12/31/2011 6/30/2011 3/31/2011Actual Actual Audit Actual

AssetsCash and Cash Equivalents & Bond Reserve 2,436,394 515,660 1,239,552 1,948,062 Student, Grant & Other Receivables, less Allowance for Doubtful Accts of $231,766 ($188,562 on 3/31/11) 461,913 17,731 254,439 Allowance adjusted quarterly. 351,678 Inventories and Supplies 112,503 112,503 130,329 Adjusted semi-annually. 152,803 Prepaid Expenses 108,211 103,260 146,189 68,742 Contributions Receivable 515,120 420,564 285,203 Adjusted quarterly. 316,515 Investments 5,595,850 5,258,989 5,182,909 5,363,028 Deferred Loan Costs, net of Accumulated Amortization 30,375 30,375 30,375 Adjusted annually. 31,174 Land Held for Resale/Investment 68,988 68,988 68,988 68,988 Land, Buildings, and Equipment (net depreciation) 10,562,704 10,653,115 10,444,479 10,453,448 Funds Held in Trust by Others 144,705 143,044 142,094 Adjusted quarterly. 141,507 Total Assets 20,036,764 17,324,228 17,924,557 18,895,945

Liabilities and Net AssetsLiabilitiesAccounts Payable and Accrued Liabilities 219,448 43,639 440,801 313,880 Student and Other Deposits 54,740 57,185 183,569 47,705 Student Payments for Upcoming Spring Semester - 33,401 - - Deferred Revenue 1,418,319 115,797 201,108 (a) 1,152,243 Accrued Compensation and Other Benefits 309,911 187,102 216,767 289,068 Amounts Held on Behalf of Others 110,094 83,056 50,667 91,161 Trust and Annuity Obligations 93,387 106,252 107,115 Adjusted quarterly. 79,575 Postretirement Benefit Obligations 398,626 398,626 398,626 Adjusted annually. 388,349 Line of Credit - - - - Debt 6,135,363 6,153,758 6,589,906 6,569,258 Capitalized Lease Obligations - - 31,169 46,169 Total Liabilities 8,739,887 7,178,816 8,219,728 8,977,409

Total Net Assets 11,296,877 10,145,412 9,704,829 (b) 9,918,536

Total Liabilities and Net Assets 20,036,764 17,324,228 17,924,557 18,895,945


The interim balance sheets (03/31/12, 12/31/11, and 03/31/11) are not in accordance with GAAP. In particular, permanently restricted activity is not reflected, nor is non-operating activity (such as unrealized investment activity and restricted contributions). However, expense accruals, deferred revenue adjustments, and reclasses were made on the interim financial statements.

(a) Deferred tuition revenue represents the portion of tuition revenue from that collected at the beginning of the semester for the remaining portion of the semester at the balance sheet date. Bluefield College collects tuition at the beginning of each semester, as is industry practice.

(b) The net of the deferral/accrual adjustments runs through net assets (through the income statement).

NOTE REGARDING OTHER AREAS NOT ADJUSTED:

The other areas for which adjustments are made only at quarter or year end typically affect balances immaterially. The exception to this is in investments and funds held in trust, where market values may vary significantly between periods presented. Investment amounts presented here have been adjusted.

Bluefield CollegeManagerial Condensed Balance Sheet (UNAUDITED)

March 31, 2012(Trial Balance Date 4/13/2012)

Report Completed by: Amy B. Ellison, Controller, April 13, 2012

2011-2012Current

Actual % of Actual % of Budget 3/31/2011$s Bdgt $s Bdgt $s Actual

Operating IncomeTraditional Tuition & Fees 7,431,868 81% 4,639,494 50% 9,197,800 6,416,280 inSPIRE & AGEO Tuition & Fees 1,843,117 42% 1,054,553 24% 4,439,830 2,373,911 Fundraising Income 1,125,252 123% 367,427 40% 917,564 246,618 Private Grants - Appalachian College Association - N/A - N/A - - Private Grants - RHEP - Virginia Tobacco Commission 51,949 N/A - N/A - 10,853 Loan Forgiveness 400,000 N/A 400,000 N/A - 400,000 Unrestricted Endowment Income 100,000 87% 100,000 87% 115,000 - Interest Income 1,609 54% 833 28% 3,000 2,793 Residence Hall Income 790,360 82% 497,869 52% 958,160 699,925 Food Service Income 1,110,336 85% 697,500 53% 1,310,000 959,213 Campus Store Income 273,226 92% 174,560 59% 296,500 281,438 Special Events Income 66,327 87% 63,277 83% 76,500 45,832 Fine Arts Community School 17,529 70% 11,295 45% 25,000 20,523 Rental Property 11,250 87% 7,500 58% 13,000 12,200 Miscellaneous Income 350 4% 275 3% 10,000 4,326 Federal Program Administrative Allowance 290 4% 290 4% 6,500 7,306 Parking Fees & Fines 1,285 26% - 0% 5,000 12,986 Transcript Fees 4,802 120% 3,291 82% 4,000 4,147 Total Operating Income 13,229,550 76% 8,018,164 46% 17,377,854 11,498,351

Operating ExpensesInstruction & Academic Support 493,728 59% 374,024 44% 842,225 559,763 Student Services 1,132,080 96% 881,166 75% 1,176,816 709,716 Institutional Support 581,844 68% 427,366 50% 854,033 540,475 Bad Debt Expense - 0% - 0% 50,000 - Depreciation Expense 562,500 78% 375,000 52% 724,000 514,500 Interest Expense 213,513 69% 144,468 46% 311,500 213,608 Maintenance 769,132 74% 423,257 41% 1,038,213 711,958 Auxiliary 956,408 80% 598,863 50% 1,198,595 788,178 Salaries 4,125,000 72% 2,638,778 46% 5,746,961 3,565,071 Employee Benefits 886,813 57% 555,355 36% 1,552,258 791,481 Unfunded Scholarships 2,893,941 72% 1,783,953 44% 4,043,323 2,529,969 Reduction of Expenditures for Release of Restrictions (127,236) 76% (115,825) 69% (167,000) (186,182) Total Operating Expenses 12,487,722 72% 8,086,404 47% 17,370,924 10,738,538

Net Unrestricted Operating Income/(Loss) per G/L Fund 1 741,828 N/A (68,240) N/A 6,930 759,812


This income statement is not in accordance with GAAP. In particular, permanently restricted activity is not reflected, nor is non-operating activity (such as unrealized investment activity and restricted contributions). However, most expense accruals and deferred revenue adjustments were made on the financials at 03/31/12, 12/31/11, and 03/31/11. The other areas for which adjustments are made only at quarter or fiscal year end typically affect balances immaterially or affect non-operating and/or temporarily or permanently restricted activity, which is not reflected in the income statement operating measure of performance.

Bluefield CollegeManagerial Unrestricted Operating Income Statement (UNAUDITED)

For the Nine-Month Period Ended, 3/31/2012 (Trial Balance Date 4/13/2012)Report Completed by: Amy B. Ellison, Controller, April 13, 2012

12/31/2011(50% of fiscal year)

3/31/2012(75% of fiscal year)

BLUEFIELD COLLEGE Internal Notes/Comments regarding Interim Unaudited Managerial Financial Statements

March 31, 2012 Completed by: Amy B. Ellison, Controller

Unaudited Statements of Financial Position (Balance Sheet)

1. Cash and cash equivalents – increase from December 31 to March 31 primarily from cash receipts as the spring semester began; decrease from June 30 to December 31, as fall semester expenditures continued, while the bulk of semester cash was received at the beginning of the fall semester; bond reserve represents the cash balance in the USDA debt service account ($96,390 at 03/31/12 and $59,535 at 03/31/11)

2. Student, grant and other receivables – increase from December 31 to March 31 primarily from charges to student accounts as the spring semester began; decrease from June 30 to December 31, as TuitionPay account payments continued to be made on accounts throughout the fall semester; increase from one year ago because charges were generated for the inSPIRE term two spring semester cohorts that started and continued in March as compared to none last March; increase in past due collections from one year ago due to sending non-current student account balances to the appropriate collection agency; note that payments received for tuition for the spring 2012 semester in December have been reclassified from negative receivables to the liability line titled “student payments for upcoming spring semester”

3. Inventories and supplies – adjusted semi-annually at June 30 and December 31; decrease from June 30 to December 31 due to campus store sales in the fall semester and the campus store has not been carrying the core inSPIRE books because these books are now provided by e-texts which are not purchased through the campus store

4. Prepaid expenses – decrease from June 30 to December 31 as prepaids for the fiscal year or academic semester/year are expensed during the course of the fiscal year; most prepaid expenses are for commercial insurance; software support on the College’s administrative computing system—Jenzabar; library databases; netbooks for inSPIRE students; and significant institutional memberships and dues; increase from December 31 to March 31, as prepaids are usually paid at the beginning of the calendar year (January) or fiscal year (June); the increase in prepaids between March 2011 and March 2012 results primarily from the netbook costs for online inSPIRE students—this cost for each cohort will be expensed over 12 months, the approximate length of the core inSPIRE program; additional prepaid items in the March 2012 balance include the athletic recruiting Scoutware software, some additional library databases, and the campus elevator service contract

5. Contributions receivable – adjusted quarterly; increase between June 30 and March 31 as new pledges have been made and recorded; the majority of these new pledges are for the student wellness center; increase from one year ago due to new pledges made and recorded throughout the year

6. Investments – increase from June 30 to March 31 as a result of market fluctuations, and from a stock gift received in the amount of $300,000 in October for the Alvah Vernon and Bertha Mae Sproles endowed scholarship fund, and $120,000 was transferred from temporarily restricted Whitmore scholarships funds to Whitmore endowed scholarship funds ($40,000 at 7/31/11, $40,000 at 8/31/11, and $40,000 at 9/30/11)—at the donor’s request; all periods presented include the balance of the Raymond James gifted annuity account (which is not included on the separate College-held investments schedule); also payout of $100,000 was drawn in December

7. Deferred loan costs – includes USDA closing costs (primarily legal); will be adjusted next at fiscal year-end, 6/30/12

8. Land held for resale/investment – no change (represents lots gifted to the College, in the Chinquapin area of Bluefield, located behind Graham High School)

9. Land, buildings and equipment – increase between June 30 and December 31 mainly from the dining hall and student activity center renovations in Shott Hall, as well as summer sidewalk work, boiler repairs, and the purchase of technology refresh items (lab PCs and network switches); decrease between December 31 and March 31 due to depreciation

10. Funds held in trust by others – increase between June 30 and March 31 from quarterly adjustments (market value changes affect the present value of expected future cash flows from trusts)

11. Accounts payable and accrued liabilities – includes $15,425 of interest accrual on USDA financing at June 30, December 31, and March 31 (principal and interest payments are made monthly—mid-month, so a one-half month accrual exists at each month end); also fluctuates based on when month-end falls relative to the College’s weekly accounts payable process; significant payables were due at June 30 related to the various summer facilities projects; decrease between June 30 and December 31, as the college closed for the holiday from December 22 through January 1, so payables for payroll taxes, benefits, etc., for December were paid before the holiday break began

12. Student and other deposits – decrease from June 30 to March 31 as the traditional fall semester began and deposits were applied to student accounts

13. Student payments for upcoming spring semester – this amount is shown only at December 31 and represents payments received for tuition for the spring 2012 semester in December; this amount has been reclassified from negative receivables to this liability line; these payments went back to accounts receivable when spring semester charges were processed at the beginning of spring semester

14. Deferred revenue – decrease from June 30 to December 31, as the traditional semester and the inSPIRE term one fall semester began in August and ended in December; also the inSPIRE term two fall semester began in October and ended in March; increase from December 31 to March 31, as the traditional spring semester and the inSPIRE term one spring semester began in January, and the inSPIRE term two spring semester and AGEO courses began in March and continued in March; deferral is recognized for the portion of tuition revenue from that collected at the beginning of the semester for the remaining portion of the semester at the balance sheet date

15. Accrued compensation – decrease from June 30 to December 31 and increase from December 31 to March 31; the main items in accrued compensation are vacation accrual and faculty contract accrual; vacation accrues throughout the calendar year and reduces as it is taken (staff can only carry over 5 vacation days at December 31); faculty contracts are paid out by August, before a new contract year begins, and then, after August, the faculty contract accrual begins to increase until the following August (while faculty work a 10-month contract, the College pays them over 12 months—therefore, an accrual builds each month until final payment for the contract year in August)

16. Amounts held on behalf of others – increase from June 30 to March 31 primarily from receipt of student activity fees which will be used by various student organizations; increase from June 30 also resulting from the receipt of “money-making” funds by various athletic teams, such as teams working at the Bristol Motor Speedway

17. Trust and annuity obligations – all of the quarterly annuity payments were pulled from trust and annuity obligations into accounts payable in January and February 2012 for the entire 2012 calendar year; the main difference between the 3/31/11 balance and the 3/31/12 balance is the fiscal year end adjustment that was made at 06/30/11

18. Postretirement benefit obligations – no change (adjusted at fiscal year-end based on an actuarial review)

19. Line of Credit – no borrowings have occurred on the line of credit during this fiscal year or since June 2009

20. Debt – decrease since June 30 due to monthly payments made on debt; debt is mainly comprised of USDA financing and the College bus financing ($12,719 at March 31, 2012 and $22,231 at March 31, 2011); the forgivable loan from a private foundation was completely forgiven in December 2011, leaving a zero balance due

21. Capitalized lease obligations – decrease from June 30 because the capitalized leases were paid in full in December 2011, leaving a zero balance due; these leases were primarily for technology equipment for Jenzabar; replacement equipment currently is being purchased outright with capital funds (funded depreciation)

22. Total net assets – fluctuates primarily from investment gains/losses (however, relative to the income statement, investment gains are not reflected in unrestricted operating activity but in non-operating activity—which is not reflected on the managerial interim income statement, so the unrestricted surplus will not include investment gains)

Unaudited Statements of Activities (Income Statement)

23. Tuition and fees (including residence hall and food service income) – the College collects tuition and fees at the beginning of each semester (for traditional and inSPIRE students), but must defer the portion of tuition revenue from that collected at the beginning of the semester for the remaining portion of the semester at the balance sheet date; increase from December 31 to March 31 as a new semester has begun (the traditional fall semester and the inSPIRE term one fall semester began in August and ended in December, and the inSPIRE term two fall semester began in October and ended in March; the traditional spring semester and the inSPIRE spring term one began in January and continued in March; also AGEO courses began in January and ended in March and the inSPIRE term two spring semester and AGEO courses began in March and continued in March the low percent of budget (42%) for inSPIRE and AGEO revenue reflects the lower than budgeted enrollment numbers in the new August and October cohorts (210 new inSPIRE students were budgeted for fall 2011 and 95 for spring 2012 in the spring budget, based on the previous fall and spring start models; new inSPIRE enrollments for August and October were 59 each, and the new inSPIRE enrollment for January was 56 and for March was 30); the low percentage of budget for the inSPIRE and AGEO revenue line also reflects the reduction in tuition price for these courses, after the preliminary spring budget was approved

24. Fundraising income – cyclical, with high revenue points in December and June; as of March 31, fundraising has exceeded the yearly budget because in March, the College received the Ingram Estate gift of $675,000 that was designated as unrestricted funds; the College became aware of this estate gift in December 2010

25. Private Grants – ACA – The College has received several grants (mainly related to academic programming) from the Appalachian College Association; revenue will be recognized as the funds are spent; RHEP – Virginia Tobacco Commission – represents the amount spent of funds received from the Virginia Tobacco Commission Grant for the Rural Healthcare Education Program (RHEP)

26. Loan Forgiveness - represents the gift of loan forgiveness by a private foundation; amount of loan in June 2009 was $1 million, $200,000 was forgiven in fiscal year 2009-10 ; $400,000 was forgiven in fiscal year 2010-11 by December 31, 2010; $400,000 was forgiven in fiscal year 2011-12 in December 2011; since loan forgiveness is for a cash inflow that occurred previously (spring 2009), this income item does not result in current cash flow

27. Unrestricted endowment income – fiscal year payout is pulled out in two draws, one in December and one in May; this item represents only the unrestricted portion of the endowment payout; the $100,000 December draw represents 87% of the unrestricted portion of the payout; last March the College had not pulled down endowment spending, because operating cash flow was stronger than this year

28. Interest income – generated on College's cash sweep account with First Century Bank; the March 2012 interest rate is .15% and the March 2011 interest rate was .15% as well; as cash flow continues to become more stable, the College may begin to invest operating cash short term in some money market funds paying higher interest rates; more interest was generated last year because operating cash flow was stronger than this year

29. Campus store income – amount expected at this time of year, which is 92% of the budgeted amount

30. Special events income – primarily summer program revenue; current amount earned is for July and August 2011, with remainder to be earned in May and June of 2012; increase from one year ago due to the timing (which specific weeks) these special events take place during the summer months and the volume of participants

31. Parking fees and fines – the College no longer charges a comprehensive or parking fee for students; this account will accrue income only as parking violation fines are charged to students throughout the year; last year (during 2010-2011) $25 per full-time student was transferred into this account from the traditional comprehensive fee account, to represent the academic year parking fee for each student—this practice has been discontinued since the parking fee has been eliminated

32. Other income categories – immaterial or amount as expected as of March 31; 75% of the fiscal year has transpired at March 31 and around 87% of the academic year has transpired (26 weeks divided by 30 academic-year weeks); miscellaneous income includes small amounts for vending machine commissions and student confirmation fee write-offs

33. Various expense categories – amount as expected for this point in the fiscal or academic year (approximately 76% spent as of March 31 is considered reasonable);

34. Student services has spent 96% of budget and $425,364 more than last March due to equipment costs of $243,694 mainly for the football program

35. Bad debt expense – significant analysis of accounts receivable for write-offs will occur at the end of the fiscal year (June 30); however, the allowance for bad debts is reviewed quarterly and adjusted if needed; at March 31, the allowance as adjusted at last June 30 is adequate

36. Unfunded scholarships – as with tuition, the College recognizes only the portion of scholarship expense that matches the portion of the semester passed as of the balance sheet date; the traditional fall semester began in August and ended in December, and the traditional spring semester began in January; unfunded financial aid is running below budget, so budget savings are expected from this category

37. Reduction of expenditures for release of restrictions – actual represents offsetting account for capitalization of fixed assets purchased with departmental operating budget funds and gifted funds used to subsidize the nursing and football budgets; the budget represents gifted funds anticipated to be used to subsidize the nursing and football budgets

March 31, 2012Description 0-‐30 31-‐60 61-‐90 91-‐120 121-‐360 Over 361 Total

With collection agency (*) 0.00 0.00 0.00 0.00 33,203.91 131,457.35 164,661.26 25%Current traditional (4,089.53) 9,737.33 223,843.57 (7,114.82) (6,874.33) 0.00 215,502.22 33%Current adult 61,311.46 (35,652.58) 52,894.32 (5,951.00) 6,999.90 3,409.24 83,011.34 13%Former non-‐traditional (767.50) 2,020.00 14,325.00 2,260.00 38,397.70 42,130.40 98,365.60 15%Former traditional 3,903.00 3,722.48 21,957.32 (17.40) 39,609.95 30,766.07 99,941.42 15%Total at March 31, 2012 60,357.43 (20,172.77) 313,020.21 (10,823.22) 111,337.13 207,763.06 661,481.84 100%

9.12% -‐3.05% 47.32% -‐1.64% 16.83% 31.41% 100.00%

March 31, 2012Description 0-‐30 31-‐60 61-‐90 91-‐120 121-‐360 Over 361 Total

With collection agency (*) 0.00 0.00 0.00 0.00 33,203.91 131,457.35 164,661.26 19%Current traditional 2,406.25 15,903.33 249,168.55 0.00 12,572.42 0.00 280,050.55 32%Current adult 91,568.50 1,995.25 67,960.02 115.00 12,676.00 3,409.24 177,724.01 20%Former non-‐traditional 895.00 2,050.00 14,325.00 2,260.00 47,728.01 62,747.34 130,005.35 15%Former traditional 3,903.00 4,165.48 21,957.32 97.60 46,521.62 39,004.96 115,649.98 13%Total at March 31, 2012 98,772.75 24,114.06 353,410.89 2,472.60 152,701.96 236,618.89 868,091.15 100%

11.38% 2.78% 40.71% 0.28% 17.59% 27.26% 100.00%(*) The College typically sends accounts to collections after no activity of 90 days. While the system-‐generated aging report begins to age these accounts as new again, the amounts shown above reflect the actual last date of activity -‐ -‐ not the date the account was submitted to the collection agency.

0-‐360 Days 631,472.26 10% 63,147.23 Over 361 Days 236,618.89 100% 236,618.89

Total Allowance 299,766.12 Unadjusted G/L 231,766.25 Entry Amount 67,999.87

Note: Current allowance of $231,766, does not need adjusted at 03/31/12. At interim periods during the course of the academic year, those accounts in the 0-‐30 days typically are very strong accounts, since many students take advantage of TuitionPay, allowing them to finance their tuition and fees over the course of the semester or year.

Allowance for Doubtful Accounts Calculation at 03/31/12

Age of Student Account (Days) with credit balances

Age of Student Account (Days) without credit balances

Bluefield CollegeStudent Account Receivables Aging Report

Report ending March 31, 2012

Swingin Net Cash

1-1-00000-001 1-2-00000-090 Net 1-1-00000-001 1-2-00000-090 Net from 2008-09Cash Line of Credit College Cash Cash Line of Credit College Cash to 2009-10

July 31 $304,661.80 ($600,000.00) ($295,338.20) $377,272.34 $0.00 $377,272.34 $672,610.54August 31 $784,984.78 ($600,000.00) $184,984.78 $459,749.93 $0.00 $459,749.93 $274,765.15

September 30 $812,694.39 ($400,000.00) $412,694.39 $1,918,473.27 $0.00 $1,918,473.27 $1,505,778.88October 31 $294,684.71 ($400,000.00) ($105,315.29) $1,394,723.17 $0.00 $1,394,723.17 $1,500,038.46

November 30 ($11,870.54) ($1,110,000.00) ($1,121,870.54) $1,035,737.99 $0.00 $1,035,737.99 $2,157,608.53December 31 $100,099.82 ($1,865,000.00) ($1,764,900.18) $624,958.28 $0.00 $624,958.28 $2,389,858.46

January 31 $1,381,416.42 ($1,865,000.00) ($483,583.58) $1,963,972.21 $0.00 $1,963,972.21 $2,447,555.79February 28-29 $731,533.19 ($1,765,000.00) ($1,033,466.81) $2,240,042.60 $0.00 $2,240,042.60 $3,273,509.41

March 31 $326,412.23 ($2,000,000.00) ($1,673,587.77) $1,700,546.39 $0.00 $1,700,546.39 $3,374,134.16April 30 $507,638.01 ($2,000,000.00) ($1,492,361.99) $976,441.33 $0.00 $976,441.33 $2,468,803.32May 31 $664,271.05 ($2,000,000.00) ($1,335,728.95) $781,442.91 $0.00 $781,442.91 $2,117,171.86June 30 $723,271.76 $0.00 $723,271.76 $1,359,988.15 $0.00 $1,359,988.15 $636,716.39

Swingin Net Cash


July 31 $686,237.35 $0.00 $686,237.35 $308,965.01August 31 $1,270,058.14 $0.00 $1,270,058.14 $810,308.21

September 30 $2,284,964.86 $0.00 $2,284,964.86 $366,491.59October 31 $1,886,866.04 $0.00 $1,886,866.04 $492,142.87

November 30 $1,361,282.00 $0.00 $1,361,282.00 $325,544.01December 31 $873,785.53 $0.00 $873,785.53 $248,827.25

January 31 $2,477,507.29 $0.00 $2,477,507.29 $513,535.08February 28-29 $2,483,046.48 $0.00 $2,483,046.48 $243,003.88

March 31 $1,886,115.77 $0.00 $1,886,115.77 $185,569.38April 30 $1,394,385.08 $0.00 $1,394,385.08 $417,943.75May 31 $852,588.56 $0.00 $852,588.56 $71,145.65June 30 $1,166,265.89 $0.00 $1,166,265.89 ($193,722.26)

Swingin Net Cash


July 31 $547,952.60 $0.00 $547,952.60 ($138,284.75)August 31 $868,478.82 $0.00 $868,478.82 ($401,579.32)

September 30 $2,409,197.59 $0.00 $2,409,197.59 $124,232.73October 31 $1,474,701.67 $0.00 $1,474,701.67 ($412,164.37)

November 30 $620,728.74 $0.00 $620,728.74 ($740,553.26)December 31 $425,363.82 $0.00 $425,363.82 ($448,421.71)

January 31 $3,089,842.70 $0.00 $3,089,842.70 $612,335.41February 28-29 $2,339,120.43 $0.00 $2,339,120.43 ($143,926.05)

March 31 $2,337,593.74 $0.00 $2,337,593.74 $451,477.97

NOTE: As of March 31, 2009, the College had expended just over $1 million of operating funds toward the East River Hall project,pending closing in June 2009 on the USDA financing. Also, during the period April-June 2009, the College convertedthe $2 million of borrowings on the prior credit line to $1 million in long-term financing, through the USDA borrowing,and the other $1 million to an on-demand forgivable loan through a private foundation. $200,000 of the forgivableloan was forgiven in December 2009, $200,000 in September 2010, $200,000 in December 2011, and the remaining $400,000 was forgiven in December 2011.

2011-12

Bluefield College

2010-11

Operating Cash Account Balance TrendPrepared By: Sarah A. Beamer, Vice President for Finance and Administration

2008-09 2009-10

March 31, 2012 Raymond James Raymond James Morgan Stanley Restricted Shelton Wells Fargo Smith Barney Total Breakdown

Cash & equivalent 140,468.28 6,129.83 - 142,241.86 288,839.97 5.34%Preferred Equity - - - 423,216.30 423,216.30 7.83%Domestic Equity 1,300,175.58 - 551,898.72 685,488.89 2,537,563.19 46.94%Global Equity 102,977.42 - 531,722.94 - 634,700.36 11.74%Emerging Markets Equity - - 69,393.06 - 69,393.06 1.28%Real Estate/Mtg-Asset Backed - - 56,528.96 9,546.53 66,075.49 1.22%Corp Bonds/Govt Securities/CD's 558,659.29 43,949.61 566,594.06 138,258.04 1,307,461.00 24.19%Global Bond 78,334.77 - - - 78,334.77 1.45%Total Market Value 2,180,615.34 50,079.44 1,776,137.74 1,398,751.62 5,405,584.14 100.00%

3-Month Return at 3/31/12 2.51% -0.06% 8.06% 10.80% 6.45%6-Month Return at 3/31/12 12.17% 1.48% 13.65% 15.90% 13.52%9-Month Return at 3/31/12 6.90% 2.85% -0.07% 6.30% 4.42%1-Year Return at 3/31/12 8.72% 4.96% 9.09% 8.40% 8.72%3-Year Net, Total Rate Return at 3/31/12 70.91% 16.50% 10.45% * 21.10% 37.65%5-Year Net, Total Rate Return at 3/31/12 13.76% 29.70% 1.14% * 4.90% 7.47%

* Wells Fargo has only been in the Pathway's managed program for approximately 2.5 years. The return rates for 3 and 5 years are performance numbers for informational purposes only.


5,405,584.14 100.00%

June 30, 2011 Raymond James Raymond James Morgan Stanley Restricted Shelton Wells Fargo Smith Barney Total Breakdown

Cash & equivalent 35,848.68 6,127.35 276.70 110,502.18 152,754.91 3.06%Preferred Equity - - - 416,512.80 416,512.80 8.34%Domestic Equity 1,262,913.87 - 547,736.16 632,695.35 2,443,345.38 48.91%Global Equity - - 553,680.71 - 553,680.71 11.08%Emerging Markets Equity - - 74,661.48 - 74,661.48 1.49%Real Estate/Mtg-Asset Backed - - 57,386.75 11,684.46 69,071.21 1.38%Corp Bonds/Govt Securities/CD's 470,568.11 42,564.01 543,665.36 150,653.32 1,207,450.80 24.17%Global Bond 78,614.85 - - - 78,614.85 1.57%Total Market Value 1,847,945.51 48,691.36 1,777,407.16 1,322,048.11 4,996,092.14 100.00%

3-Month Return at 06/30/11 1.67% 2.05% 0.31% 2.64% 1.45%6-Month Return at 06/30/11 5.48% 3.11% 3.73% 5.90% 4.95%9-Month Return at 06/30/11 11.99% 3.44% 9.54% 11.00% 10.77%1-Year Return at 06/30/11 21.51% 3.18% 19.75% 23.00% 21.10%3-Year Net, Total Rate Return at 06/30/11 6.22% 18.77% 3.79% * 7.30% 5.76%5-Year Net, Total Rate Return at 06/30/11 19.24% 33.60% 4.01% * 7.00% 10.72%



4,996,092.14 100.00%

4,996,092.14 550,200.46

(100,000.00) (40,708.46)

Investments at March 31, 2012 5,405,584.14

Prepared by: Amy B. Ellison, Controller, 04/13/12


Growth and return

Bluefield CollegeInvestment Analsysis & Allocation by Type and Manager

March 31, 2012

Investments at June 30, 2011New deposits/gifts

Withdrawals from Spending Policy


Preliminary Budget for 2012-13 Highlights

April 21, 2012 Note These highlights are in reference to the 2012-2013 Spring 2012 Proposed Preliminary Budget Summary Page and related income and expense schedules. This spring preliminary budget is the spring phase of a two-phase budget process—development and Board approval of a preliminary budget each spring for the forthcoming fiscal year and development and Board approval of a revised budget each fall for that current year, based on actual fall enrollment and related scholarship expenses. Operating Surplus and Cash Flow This preliminary budget projects basically a break-even budget; net budgeted revenue in this preliminary budget for 2012-13 is budgeted to slightly exceed projected expenditures by $34,952. Budgeted expenditures include the non-cash items of depreciation and bad debt expense. After removing these two non-cash expenditures and acknowledging the need for contribution to the debt reserve for the East River Hall USDA financing, the payment of USDA principal obligations (interest is budgeted within expenditures), and spending for several essential capital items, operations are projected to generate a cash surplus of $125,000 for 2012-13. (Note that this basic cash analysis does not include fluctuations between fiscal year-ends in liquid asset and liability accounts.) Budget Assumptions Tuition and Fees

• Tuition—traditional students: $21,060 • Unfunded tuition discount—traditional students: 44.5% (around 40-41% actual for the

past four years; percentages calculated on regular session tuition only—not miscellaneous fees and summer school tuition)

• Room: $2,680 for Alumni (single rooms were converted to doubles in fall 2011); $2,990 for Cruise and Rish; $3,410 for East River Hall

• Board: $4,650 • Tuition—inSPIRE and AGEO (Associate’s/General Education) students: $335 per credit

hour • Enrollment projections: see Enrollment Trend Highlights for 2012-13 Budget Revision (three charts—(1) traditional students pursuing bachelor’s, (2) inSPIRE students pursuing Bachelor’s (core curriculum students), and (3) inSPIRE students taking general education courses and students taking general education courses and students pursuing Associates

General Analysis of Budget Fluctuations (see budget summary and income and expense budgets; please note that actual activity presented through 2/28/12 represents only eight months of activity—net of the deferral of revenue collected for the portion of the semester not yet completed; most comments below address the fluctuations between the preliminary budget amounts for 2011-12 and the preliminary budget amounts for 2012-13) Revenues

Ø Traditional tuition and fees—increasing as a result of increased tuition rate (from $19,980 to $21,060) and projected enrollment growth (academic year full-time equivalent of 475 for 2012-13, as compared to 460 budgeted for 2011-12); retention is anticipated to remain strong between spring and fall, at 79-80 percent (past few years’ retention from spring to fall has been between 78 and 80 percent).

Ø inSPIRE tuition and fees—decreasing slightly, mainly as a result of the tuition rate dcrease from $385 per credit hour as included in the spring budget last year, to $335 for the proposed 2012-13 budget (the rate for 2011-12 was reduced to $325 after the preliminary budget was approved); continuing with six start dates per year, anticipating larger groups in August and January—average per term inSPIRE headcount budgeted at 288; retention is anticipated to remain strong between inSpire terms, at 90 percent.

Ø Associate’s/General Education tuition and fees—to round out their program and obtain the credit hours required for a degree, often inSPIRE students must take general studies and elective courses, in addition to their core curriculum courses; increasing because 2011-12 reflected a significant increase in the proportion of AGEO courses taken as related to inSPIRE credit hours—probably because of the College’s elimination of minimum required hours for entry into the inSPIRE program and the roll-out of an Associates curriculum. (While the College intends to enhance and grow its offering of dual credit courses to high school students, and take this program online, this proposed preliminary budget for 2012-12 DOES NOT include revenue or expenses associated with that initiative.

Ø Fundraising income—Reducing unrestricted fundraising goal to reasonable level, based on recent unrestricted gift success; recent fundraising goal was considered aggressive and was dependent upon positive results from significant gift requests.

Ø Unrestricted endowment income—reason for reduction is that three-year market value basis reduced from weak market performance of a couple of years ago, which has reduced the market values for the recent years of the 12-quarter average; also beginning in 2012-13, spending calculation is based on a 12-quarter, rather than a 3-year average.

Ø Interest income—remaining at a low amount to reflect the reality of current low interest rates; also cash flow is projected to remain fairly tight.

Ø Residence hall income and food service income—increasing as a result of increased room and board rates (3 percent) and projected resident student growth (academic year average residents of 330 for 2012-13, as compared to 320 budgeted for 2011-12).

Ø Campus Store income—reducing primarily since the Campus Store no longer sells textbooks to inSPIRE students; rather, these students receive electronic textbooks, the cost of which is included in their tuition; some of this lost revenue should be offset hopefully by traditional student enrollment growth and increased non-text sales.

Ø Special events income—remaining flat, comparable to levels of the past two years. Ø Other income sources—stable. Ø Unfunded scholarships—increasing traditional student unfunded tuition discount

projection to 44.5%, based on best projections of matrix academic awards, special academic scholarships, and athletic and other talent financial aid; this “expense” is

shown with revenues, since focusing on net tuition revenue is important. Ø Release of restrictions for operating items—the amount included for the 2011-12

budget represents the transfer of additional or carryover gift funds for football ($25,000), nursing ($75,000), and the New Opportunity School for Women, “NOSW” ($50,000)—combined $150,000 gift offset.

Expenditures

Ø Overall—expenditure budgets have been increased in the proposed preliminary budget for 2012-13, as a result of the net revenue increase projected from enrollment growth; specific items of particular interest are explained below.

Ø Instruction—the main increases in these budgets are the costs of the electronic textbooks to be provided to inSPIRE students—considered a direct instructional cost of the academic programs; funding for the initial year of the”Confident Communicator,” the College’s Quality Enhancement Plan (QEP—SACSCOC requirement); and funding for stadium band uniforms.

Ø Academic support—increasing primarily from electronic textbooks for AGEO students; programming for the New Opportunity School for Women (for which funds will be raised); and the SACSCOC on-site visit to occur in September.

Ø Student services—decreasing from removal of funds placed in budget in 2011-12 to buy-out the admissions vehicle leases (some reallocation is evident between central student services purchases to athletics, as athletic equipment funds have been moved to the athletic department).

Ø Institutional support—increasing primarily as the result of removing capital lease offset funds, shown as a negative expense to accommodate the accounting entry against the balance sheet lease liabilities; some small increases included for billboard advertising, audit fees, and commercial insurance.

Ø Depreciation expense—increasing from recent (and anticipated summer 2012) capital purchases—mainly dining hall/SAC renovation, technology, and significant boiler repairs—as well as $600,000 of capital expenditures anticipated to occur during 2012-13.

Ø Interest expense—represents interest on the East River Hall USDA debt and possible borrowings on the line of credit.

Ø USDA debt principal—monthly principal payments are made monthly and total approximately $70,000 per year. This budget line has been taken to zero for 2012-13, moving instead to be paid through funded depreciation.

Ø Maintenance—increasing from various utilities and a small increase for building maintenance.

Ø Auxiliary—increasing primarily from food service cost (the College has not yet received rates from Valley for 2012-13); some increase also for resident student laundry and cable services (which are included in room fees); Campus Store expense reduction relates to reduced cost of textbook purchases, since inSPIRE students now are provided electronic textbooks.

Ø Employee salaries—increasing from addition of a special education faculty member, a QEP director/developmental studies position, NOSW director, inSPIRE administrative staffing and recruiters, a traditional student transfer counselor, and the full-year effect of the 2 percent salary increase in November 2011; please note that this proposed preliminary budget DOES NOT include salary increases in 2012-13

Ø Employee benefits—increasing as a result of the effects of various hires noted above, estimated health insurance premium increase (1/1/13), and increased tuition benefit cost/participation.

“Trigger Point” Analysis The Executive and Finance Committees of the Board have requested an analysis of ideas for the College’s reaction to enrollment shortfalls, if they were to occur this coming fall. The chart below is meant to display the budget parameters and examples of the effects of enrollment shortfalls. That chart reflects that the College’s total budget is $14 million, EXcluding unfunded financial aid and e-books (“cost of goods sold,” if you will). (Including those expenses, the College’s budget is nearly $19 million!) Of the $14 million, nearly $5 million represents expenditures that are basically “impossible” to cut—items such as depreciation, federal work-study commitments (federal portion), service contracts, debt service, fixed facilities costs, etc. Therefore, only $9 million of the College’s budget is “open to reduction.” The lower calculation in the chart below shows that, for every 10 students short, the College would need to reduce the “open to reduction” budgets, including personnel costs, by 1.6 percent to 2.0 percent. (The effect of inSPIRE enrollment, in particular, fluctuates based on when the term begins. The credit hours that fall into a particular fiscal year are related to when students begin their programs.) If the College were to miss enrollment goals, in addition to general expenditure budget reductions, specific areas that can/will be evaluated more clearly in the fall include: work-study budgets (non-federal portion), tuition benefits (do not currently know of those planning to benefit who actually will use the benefit), unfunded financial aid (discount could be lower—or higher—than budgeted), funded financial aid (more may be available to backfill unfunded), AGEO credit hour enrollment (could be stronger—or weaker—as a function of inSPIRE core enrollment), fundraising goal (could be increased), and endowment payout (could consider payout adjustment).

"Protected" Open toTotal Budget Have-to's Reduction

Personnel budget--salaries (6,047,882) (6,047,882)Personnel budget--benefits (1,748,768) (1,748,768)Total personnel budget (7,796,650) (7,796,650)Non-cash items (depreciation and bad debt expense) (825,000) (825,000)Work study (College's portion, required regarding Federal contribution) (60,000) (15,000) (45,000)Service contracts, etc. (phone system, software, J-bar maintenance,

laundry machine rental, cable fees) (860,000) (860,000)Bank charges, interest, principal, etc. (400,000) (400,000)Facilities--insurance, utilities, taxes, Aramark (1,020,000) (1,020,000)Auxiliary set costs (bookstore cost of sales, Valley contract, etc.) (1,110,000) (1,110,000)Misc other "protected" budgets in various areas (e.g.,

athl travel/officials,athl insrc,athl facil rental, student teacher expenses) (475,000) (475,000)Other budget items (1,520,000) (1,520,000)Total bugeted expenses (excludes unfunded financial aid and e-books) (14,066,650) (4,705,000) (9,361,650)

10students

For every tradtional FTE short, net revenue shortfall is:Tuition discounted at 44.5% 12,000

Room charge 3,410Board profit 2,190

Total net revenue shortfall for every 1 traditional FTE short 17,600 176,0002.0% cut in expenditures "open to reduction, including personnel

For every inSPIRE headcount short in JULY, net FY revenue shortfall is:36 credit hours at $335 per cr hr minus $25 per cr hr e-book cost 12,000

50% additional AGEO credit hours 6,000Total net revenue shortfall for every iniSPIRE headcount short in JULY 18,000 180,000

2.0% cut in expenditures "open to reduction, including personnelFor every inSPIRE headcount short in AUGUST, net FY revenue shortfall is:

30 credit hours at $335 per cr hr minus $25 per cr hr e-book cost 10,000Total net revenue shortfall for every iniSPIRE headcount short in AUGUST 5,000

15,000 150,0001.6% cut in expenditures "open to reduction, including personnel

Note explanations on next page.

(b) (Adjusted for

2011-2012 (Deferrals) 2012-2013

(a) (a) (a) (a) Proposed (8 Months) Proposed

6/30/2008 6/30/2009 6/30/2010 6/30/2011 Preliminary 2/29/2012 Preliminary

Actual Actual Actual Actual Budget (04/11) Actual Budget (04/12)

Net Income (after deducting scholarships) $10,654,444 $10,034,951 $11,428,041 $11,655,689 $13,472,136 $8,267,263 $14,476,407

Expenses (excluding non-cash items) ($10,820,814) ($11,167,465) ($10,857,659) ($10,685,035) ($12,691,206) ($7,984,588) ($13,615,455)

Surplus/(Deficit) Before Non-Cash Items ($166,370) ($1,132,514) $570,382 $970,654 $780,930 $282,675 $860,952

Non-Cash Expenses:

Depreciation ($612,553) ($607,528) ($667,399) ($693,831) ($724,000) ($500,000) ($776,000)

Bad Debt Expense $20,977 ($243,375) ($59,340) ($37,375) ($50,000) $0 ($50,000)

Total Non-Cash Expenses ($591,576) ($850,903) ($726,739) ($731,206) ($774,000) ($500,000) ($826,000)

Total Operating Budget Surplus/(Deficit) ($757,946) ($1,983,417) ($156,357) $239,448 $6,930 ($217,325) $34,952

Add Back Non-Cash Expense Items $591,576 $850,903 $726,739 $731,206 $774,000 $500,000 $826,000

Cash Needed for Principal Payments on Debt/Debt Reserves:

Net Payments on Line of Credit (in excess of crt yr borrowing) $0 $0 $0 $0 $0 $0 $0

Net Principal Payments on Debt and Capital Leases (c) ($283,677) ($746,727) ($339,805) ($466,873) ($95,000) ($479,556) ($70,000)

USDA Debt Reserve Requirement (d) $0 ($2,835) ($31,186) ($36,854) ($34,020) ($22,680) ($34,020)

Essential Capital Purchases (e) $0 $0 $0 ($449,684) ($460,000) ($251,305) ($632,000)

Net Projected Operating Cash Surplus/(Deficit) (f) ($450,047) ($1,882,076) $199,391 $17,243 $191,910 ($470,866) $124,932

BLUEFIELD COLLEGE

2012-2013 SPRING 2012 PROPOSED PRELIMINARY BUDGET SUMMARY PAGE

FOR BOARD'S APPROVAL AT APRIL 2012 MEETING

April 21, 2012

Prepared by Sarah A. Beamer, VP Finance and Admin

(a) 6/30/08, 6/30/09, 6/30/10, and 6/30/11 amounts are per the College's audited financial statements. Income and expenses, therefore, include expenditure of and release of restrictions for the use of

temporarily restricted funds. The College's operating budget does not include such items, because of the unpredictable nature of these items. The audited financial statements show that

for the year ended 6/30/08 net assets released from restrictions totaled $1,002,304; for the year ended 6/30/09 this amount was $995,628; for the year ended 6/30/10, this amount was $961,516;

and for the year ended 6/30/11, this amount was $973,500.

(b) Because of the significant changes made to the inSPIRE program beginning in fall 2011 and the continuing start-up nature of implementing the changes throughout fiscal year 2011-12, a revised

budget for 2011-12 was not approved by the Board of Trustees. Instead, the Board agreed that the College Leadership Team would continue operating from the preliminary budget for 2011-12.

Some adjustments have occurred in the 2011-12 preliminary budget amounts between those included in last spring's budget presentation and those shown here, as football and rural health budgets

have been adjusted for cash gifts received--both revenue (to recognize the use of funds contributed for those purposes) and expenses. The operating surplus and net cash surplus reflected here

for the 2011-12 preliminary budget are the same as shown in last spring's presentation.

(c) Principal payments on debt and capital leases typically are budgeted within the operating budget and pulled out of expenses for audited financial statement purposes, since they represent a debt

reduction rather than an expense. In all fiscal year actual columns shown, principal payments are pulled out of expenses, funded basically through depreciation, which is included in expenditures.

The large amount of principal payments on debt for the year ended 6/30/09 includes pay off of the science center debt for $554,758, of which $389,705 was paid with USDA funds (the rest was regular

payments throughout the year). The amount of principal payments on debt for the year ended 6/30/10 includes $200,000 of loan forgiveness from a private foundation. This amount is included

as a "principal payment" because the revenue from the loan forgiveness is included in income (gift revenue). The amount of principal payments on debt for the 2/29/12 actual column includes

$400,000 of loan forgiveness from a private foundation. Principal payments on debt and capital leases in the budget column for 2012-13 IS NOT included in expenditures, so they are listed in the

cash needed section, to be paid with funded depreciation.

(d) The USDA debt terms included interest only for two years, along with funding a debt reserve by one-tenth an annual payment each year (funded monthly). Principal payments began in July 2011.

(e) Separate sheet.

(f) This operating cash surplus/(deficit) is before consideration of the use of cash for purchasing capital assets, other than the "essential capital purchases" shown as budgeted for 2011-12

and 2012-13 and actual for 6/30/11. Total capital purchases for the years ended 6/30/08, 6/30/09, and 6/30/10 were $1,024,702, $3,560,222, and $1,393,326, respectively. Of the capital

purchases for the year ended 6/30/09, $3,160,595 was for East River Hall, funded with USDA debt funds; the remainder totaled $399,628. Of the capital purchases for the year ended 6/30/10,

$1,233,788 was for East River Hall also funded with USDA debt funds; the remainder totaled $159,538.

April 2011 April 2012Preliminary Preliminary $ %

Actual Actual Budget Budget Incrs/(Decrs) Incrs/(Decrs)Acccount Title 6/30/2010 6/30/2011 2011-2012 2012-2013 4/2011 - 4/2012 11-12 to 12-13

Traditional Tuition & Fees 6,985,026.54 7,643,317.02 9,206,000.00 10,057,500.00 851,500.00 9.2%

inSpire Tuition & Fees 3,069,712.57 2,764,028.81 3,592,830.00 3,486,250.00 (106,580.00) (3.0%)

Associate's/General Education Tuition & Fees 742,148.00 306,201.73 847,000.00 1,733,625.00 886,625.00 104.7%

Fundraising Income 631,353.37 876,137.75 917,563.92 500,000.00 (417,563.92) (45.5%)

Unrestricted Endowment Income 154,077.32 135,414.40 115,000.00 94,000.00 (21,000.00) (18.3%)

Interest Income 3,261.66 3,373.40 3,000.00 2,000.00 (1,000.00) (33.3%)

Residence Hall Income 717,634.60 832,622.00 958,160.00 1,018,680.00 60,520.00 6.3%

Food Service Income 975,062.50 1,133,551.00 1,310,000.00 1,446,500.00 136,500.00 10.4%

Campus Store Income 337,454.61 318,928.05 309,500.00 296,500.00 (13,000.00) (4.2%)

Special Events Income 77,178.69 84,912.01 76,500.00 76,500.00 - 0.0%

Fine Arts Community School 21,113.67 30,921.00 25,000.00 25,000.00 - 0.0%

Rental Property 15,357.50 15,950.00 13,000.00 13,000.00 - 0.0%

Federal Program-Administrative Allowance 9,760.00 14,812.05 6,500.00 6,500.00 - 0.0%

Miscellaneous Income 6,803.03 4,351.97 10,000.00 5,000.00 (5,000.00) (50.0%)

Total Revenue 13,745,944.06 14,164,521.19 17,390,053.92 18,761,055.00 1,371,001.08 7.9%

Unfunded Scholarship Expense (2,744,021.36)$ (2,976,030.56)$ (4,082,918.12)$ (4,434,648.00)$ (351,729.88)$ 8.6%

Release of Restrictions for Operating Items (a) 426,118.00 467,198.03 165,000.00 150,000.00 (15,000.00) (9.1%)

Net Revenue 11,428,040.70 11,655,688.66 13,472,135.80 14,476,407.00 1,004,271.20 7.5%

(a) The amount of release of restrictions for operating items is unpredictable and not a part of the operating budget. The amount is included

here for the fiscal years ended 6/30/10 and 6/30/11, to reconcile this budget presentation to the audited financial statements. As is

typical in higher education, Bluefield College does not record this activity in the operating accounts until fiscal year-end. During the

fiscal year, this activity is tracked in the College's temporarily restricted funds. The amount included in the 2011-12 preliminary budget

columns represents the transfer of gift funds for football ($25,000), nursing ($40,000), PhD accounting professor ($35,000), and special

education professor ($65,000). The PhD accounting professor and special education professor education positions were not filled

in 2011-12 nor were funds raised for these positions. The amount included in the 2012-13 proposed preliminary budget represents the

transfer of additional gift funds for football ($25,000), nursing ($75,000), and the New Opportunity School for Women ($50,000).


BLUEFIELD COLLEGE2012-13 BUDGETED INCOME--SPRING PRELIMINARY BUDGET

FOR BOARD'S APPROVAL AT APRIL 2012 MEETINGApril 21, 2012

April 2011 April 2012Preliminary Preliminary $ %

Actual Actual Budget Budget (Incrs)/Decrs (Incrs)/DecrsAcccount Title 6/30/2010 6/30/2011 2011-2012 2012-2013 4/2011 - 4/2012 11-12 to 12-13

Instruction Allocation (e.g., Postage) (4,763.44) (8,473.01) (5,500.00) (5,500.00) - 0.0%

Fine Arts (38,331.15) (40,821.57) (40,992.94) (46,492.94) (5,500.00) 13.4%

Language, Literature, and Communications (5,001.21) (5,001.50) (5,917.00) (17,917.00) (12,000.00) 202.8%

Christian Studies (954.42) (1,723.96) (1,715.00) (1,715.00) - 0.0%

Science (12,527.00) (12,259.82) (13,981.78) (13,861.78) 120.00 (0.9%)

Social Science (1,136.74) (2,823.26) (4,160.00) (4,160.00) - 0.0%

Education (6,998.90) (7,618.12) (8,639.00) (8,389.00) 250.00 (2.9%)

Exercise and Sport Science (597.90) (2,044.00) (3,156.38) (3,156.38) - 0.0%

Business (1,162.12) (1,805.00) (1,935.00) (1,910.00) 25.00 (1.3%)

inSPIRE - General/Shared Expenses (8,858.21) (8,079.21) (14,037.00) (10,537.00) 3,500.00 (24.9%)

inSPIRE - Public Safety (4,811.34) (6,171.66) (5,325.00) (70,325.00) (65,000.00) 1220.7%

inSPIRE - Human Services (1,653.73) (1,763.51) (2,255.00) (67,255.00) (65,000.00) 2882.5%

inSPIRE - Management (4,833.58) (4,674.17) (5,475.00) (70,475.00) (65,000.00) 1187.2%

inSPIRE - Nursing - - (40,500.00) (105,500.00) (65,000.00) 160.5%

Total Instruction (91,629.74) (103,258.79) (153,589.10) (427,194.10) (273,605.00) 178.1%Academic Support Allocation (e.g., Postage) (2,961.39) (2,801.50) (3,500.00) (3,500.00) - 0.0%

Academic Center for Excellence (11,800.57) (13,622.26) (13,045.00) (13,950.00) (905.00) 6.9%

inSPIRE, Associates/Gen Ed Academic Support (347,310.24) (431,166.73) (387,651.00) (410,651.00) (23,000.00) 5.9%

New Opportunity School for Women - - - (25,000.00) (25,000.00) N/A

Academic Affairs (75,766.29) (68,152.42) (104,240.50) (158,680.50) (54,440.00) 52.2%

International Studies (4,370.47) (938.68) (11,211.38) (11,211.38) - 0.0%

Library (56,798.33) (51,884.43) (66,682.78) (65,582.78) 1,100.00 (1.6%)

Institutional Effectiveness - (1,497.53) (1,675.00) (1,525.00) 150.00 (9.0%)

Academic Information Services and Technology (116,044.43) (38,419.06) (87,150.00) (55,150.00) 32,000.00 (36.7%)

Total Academic Support (615,051.72) (608,482.61) (675,155.66) (745,250.66) (70,095.00) 10.4%Student Services Central Purchases (e.g., Ftbl Eqpmt, Admsns Autos) (25,380.39) (26,907.92) (222,000.00) (30,000.00) 192,000.00 (86.5%)

Registrar (3,499.07) (3,417.25) (4,145.00) (6,145.00) (2,000.00) 48.3%

Enrollment Management (293,288.20) (319,863.36) (241,892.00) (241,892.00) - 0.0%

Creative Media (14,889.49) (20,306.64) (14,150.00) (14,150.00) - 0.0%

Financial Aid (6,731.05) (8,315.75) (10,253.00) (10,303.00) (50.00) 0.5%

Student Services (16,909.95) (9,595.70) (9,893.13) (12,474.13) (2,581.00) 26.1%

Campus Security (3,129.91) (1,292.42) (4,250.00) (4,250.00) - 0.0%

Bonner Program (1,917.27) (1,094.50) (1,300.00) (1,300.00) - 0.0%

Student Activities (75,511.19) (48,112.44) (74,065.87) (74,065.87) - 0.0%

Campus Minister (6,377.27) (10,993.23) (3,500.00) (3,500.00) - 0.0%

Athletics (including Sports Information) (464,250.68) (387,019.99) (564,347.00) (722,227.00) (157,880.00) 28.0%

Total Student Services (911,884.47) (836,919.20) (1,149,796.00) (1,120,307.00) 29,489.00 (2.6%)


BLUEFIELD COLLEGE2012-13 BUDGETED EXPENSES--SPRING PRELIMINARY BUDGET


Institutional Support Allocation (e.g., Postage) 124,427.27 53,199.83 35,000.00 (17,000.00) (52,000.00) (148.6%)

President's Office (39,548.71) (34,016.64) (34,050.00) (43,500.00) (9,450.00) 27.8%

Church Relations (2,536.98) (1,898.94) (1,415.00) (1,415.00) - 0.0%

Advancement (66,460.15) (59,040.86) (58,475.00) (58,475.00) - 0.0%

Capital Campaign (13,398.44) (4,103.75) (4,500.00) (4,500.00) - 0.0%

Alumni (26,688.72) (20,237.52) (32,525.00) (32,525.00) - 0.0%

Public Relations (61,614.13) (47,728.60) (43,250.00) (50,000.00) (6,750.00) 15.6%

Business Office (15,648.15) (20,382.83) (17,400.00) (19,400.00) (2,000.00) 11.5%

Administrative Information Services and Technology (234,232.53) (226,042.13) (226,900.00) (192,740.00) 34,160.00 (15.1%)

General Institutional Support (365,761.90) (363,966.08) (410,350.00) (436,850.00) (26,500.00) 6.5%

Total Institutional Support (701,462.44) (724,217.52) (793,865.00) (856,405.00) (62,540.00) 7.9%Bad Debt Expense (59,340.06) (37,375.16) (50,000.00) (50,000.00) - 0.0%Depreciation Expense (667,398.96) (693,830.83) (724,000.00) (776,000.00) (52,000.00) 7.2%Interest Expense (251,478.31) (283,157.98) (311,500.00) (315,000.00) (3,500.00) 1.1%USDA Debt Principal (Capital Lease Principal in IST) - - (65,000.00) - 65,000.00 (100.0%)Maintenance (977,600.34) (963,343.43) (1,036,000.00) (1,098,000.00) (62,000.00) 6.0%Auxiliary Allocation (e.g., Postage) - - - - -

Residence Life (133,626.20) (165,836.18) (176,175.00) (189,675.00) (13,500.00) 7.7%

Campus Store (249,925.11) (234,908.53) (236,750.00) (223,750.00) 13,000.00 (5.5%)

Food Service (535,815.02) (574,024.98) (752,000.00) (844,000.00) (92,000.00) 12.2%

Special Programs (38,929.14) (34,810.12) (39,470.00) (39,220.00) 250.00 (0.6%)

Fine Arts Community School (2,265.31) (2,784.21) (7,200.00) (7,200.00) - 0.0%

Total Auxiliary (960,560.78) (1,012,364.02) (1,211,595.00) (1,303,845.00) (92,250.00) 7.6%

Employee Salaries (4,826,076.85) (4,937,762.58) (5,742,861.14) (6,010,380.11) (267,518.97) 4.7%Employee Benefits (1,211,873.62) (1,118,635.88) (1,551,844.02) (1,739,073.50) (187,229.48) 12.1%

Unfunded Scholarships (Not Funded by Gifts or Endowment) (2,744,021.36) (2,976,030.56) (4,082,918.12) (4,434,648.00) (351,729.88) 8.6%Deduct Unfunded Scholarships from Revenue 2,744,021.36 2,976,030.56 4,082,918.12 4,434,648.00 351,729.88 8.6%

Release of Restrictions for Operating Items (a) (426,118.00) (467,198.03) - - - N/AMiscellaneous Reconciling Audit Items 116,077.00 370,305.23 - - - N/A

Net Expense (11,584,398.29) (11,416,240.80) (13,465,205.92) (14,441,455.37) (976,249.45) 7.3%

Non-Cash Expenses:Depreciation 667,398.96 693,830.83 724,000.00 776,000.00 52,000.00 7.2%Bad Debt Expense 59,340.06 37,375.16 50,000.00 50,000.00 - 0.0%Total Non-Cash Expenses 726,739.02 731,205.99 774,000.00 826,000.00 52,000.00 6.7%

Total Cash Expenses (10,857,659.27) (10,685,034.81) (12,691,205.92) (13,615,455.37) (924,249.45) 7.3%

(a) The amount of release of restrictions for operating items is unpredictable and not a part of the operating budget. The amount is included here for

the fiscal years ended 6/30/10 and 6/30/11, to reconcile this budget presentation to the audited financial statements. As is typical in higher education,

Bluefield College does not record this activity in the operating accounts until fiscal year-end. During the fiscal year, this activity is tracked in the College's

temporarily restricted funds. No amounts are included in the budget columns because the expenses (football and rural health are included in the specific

relevant budget lines above.

ProjectedExpense Notes

1 House #8 office space conversion $30,000 guess2 Chapel audio/visual upgrade $14,0003 Jenzabar Personnel module $0 defer to next year4 Campus-wide wireless data access $55,0005 Technology refresh--year 2 & catch-up year 1 $260,0006 Renovate Lansdell 3rd floor for one-stop shop $125,000 guess7 Lansdell exterior painting $0 defer or use surplus8 East River Hall ADA campus access $30,000 guess9 ESS sports training equipment $21,000 partial request (a)

10 Chapel performance lighting $3,00011 Lower Rish classroom $11,00012 New performance risers $4,00013 Chapel exterior painting (columns and steeple) $0 defer or use surplus14 Two 15-passenger vans $40,00015 Bus mother board repair ???????????16 Stadium band instruments $30,00017 Stadium band locker units & partition for storage $3,00018 Stadium band trailer for instrument transport $6,000

Total of capital budget requests $632,000

Additional capital-related expenditures to come from funded depreciation:Net Principal Payments on East River Hall USDA Debt $70,000

East River Hall USDA Debt Reserve Requirement $34,020

Total projected use of funded depreciation $736,020

(a) Four Lange skinfold calipers at $1,500 each (seven requested), two Quinton stress testing treadmills at $6,000 each,and one Monarch stress testing bicycle ergometer at $3,000. Other ESS items requested but not funded are oneHydrostatic weighing apparatus at $16,000-$20,000 and expanded exercise laboratory facility.


BLUEFIELD COLLEGE2012-13 ESSENTIAL CAPITAL PURCHASES--SPRING PRELIMINARY BUDGET


April 21, 2012

Returning Full-time

Returning Part-Time

New (and Reapps) Full-Time

New (and Reapps) Part-Time (1)

Total Head Count

Total FTE (Full-Time Equiv)

Resident Students

Actual Fall Count 2008 231 15 132 11 389 374 193Actual Spring Count 2009 315 35 11 3 364 342 176Actual Average Count 2008-09 273 25 72 7 377 358 185



Prelim Budget 2011-12 Average for Prelim Bdgt 2011-12 328 20 125 15 488 460 320Actual Fall Count 2011 241 26 223 0 490 467 321Actual Spring Count 2012 372 16 22 15 425 397 272Actual Average Count 20111-12 307 21 123 8 458 432 297

Budgeted Fall Count 2012 258 20 230 20 528 495 345Budgeted Spring Count 2013 420 30 25 10 485 455 315Avg for Prelim Budget 2012-13 339 25 128 15 507 475 330

(1) Except for fall 2011, the actual number of new part-time students, particularly each fall, primarily includes dual credit high school "challenge" students, for whom tuition is discounted significantly. However, the budgeted counts for new part-time students do not include these challenge students. Rather, the projections include full-pay part-time students.

Actual 2011-12

Bluefield CollegeEnrollment Trend Highlights for 2012-13 Preliminary Budget

April 2012Traditional Students Pursuing Bachelor's

Spring Preliminary Budget 2012-13

Actual 2008-09

Actual 2009-10

Actual 2010-11

TRADITIONAL STUDENTS PURSUING BACHELOR'S

April 21, 2012

Summer Term 2 (2) Fall Term 1 Fall Term 2 (2) Spring Term 1 Spring Term 2 (2) Summer Term 1 Average Per Term

First Semester Head Count N/A 159 N/A 74 N/A 0 78Second Semester Head Count N/A 54 N/A 145 N/A 68 89Third Semester Head Count N/A 0 N/A 48 N/A 136 61Total Head Count N/A 213 N/A 267 N/A 204 228



First Semester Head Count N/A 210 N/A 95 N/A 50 118Second Semester Head Count N/A 18 N/A 190 N/A 85 98Third Semester Head Count N/A 25 N/A 16 N/A 170 70Total Head Count N/A 253 N/A 301 N/A 305 286First Term Head Count N/A 55 58 56 30 50 50Second Term Head Count N/A N/A 55 52 55 29 48Third Term Head Count N/A 10 N/A 50 48 53 40Fourth Term Head Count N/A N/A 9 N/A 50 46 35Fifth Term Head Count N/A 25 N/A 9 N/A 48 27Sixth Term Head Count N/A N/A 25 N/A 9 N/A 17Total Head Count N/A 90 147 167 192 226 164

First Term Head Count 40 100 50 75 50 50 61Second Term Head Count 45 36 96 45 69 45 56Third Term Head Count 28 40 35 86 41 62 49Fourth Term Head Count 52 26 38 32 78 36 44Fifth Term Head Count 44 48 25 34 30 74 43Sixth Term Head Count 46 40 46 23 32 28 36Total Head Count 255 290 290 295 300 295 288

(1) inSPIRE enrollment numbers do not include pre-groupers or post-groupers, who are taking only general education courses; those credit hours areincluded in the Associates/General Education Online credit hour projections. Attrition between terms in the inSPIRE program is estimated conservatively to be 5-10 percent.

(2) Prior to fall 2011, the inSPIRE program basically had one fall term, one spring term, and one summer term. Even during the period when start dates varied, all starts were close enough to the beginning of the traditional semester that division of semesters into terms was not necessary. Under the new model, beginning in academic year 2011-12, each traditional semester will have two official starting points, giving rise to two terms per semester, including summer. Summer 2 for each academic year actually begins in July each year; therefore, this term is the first term in each fiscal year. Since the new model began in fall 2011 with fall term 1, a summer term 2 did not exist for 2011-12. The semesters for each group starting will run for two consecutive terms; therefore, the core inSPIRE program will consist of six terms or three semesters.


inSPIRE Students Pursuing Bachelor's--Core Curriculum StudentsApril 2012

Actual 2009-10

Actual 2010-11


(2) 4/2012 Projected Budget 2011-12

(Fall Term 1, Fall Term 2, Spring Term 1, and

Spring Term 2 numbers are actual)

inSPIRE STUDENTS PURSUING BACHELOR'S (inSpire Core) (1)

Actual 2008-09

(2) Spring Preliminary

Budget 2012-13

April 21, 2012

Summer Term 2 (3) Fall Term 1 Fall Term 2 (3) Spring Term 1 Spring Term 2 (3) Summer Term 1 Average Per TermTotal Credit Hours

per Academic Year

Actual 2007-08 Total Credit Hours (1) N/A 1,087 N/A 1,727 N/A 789 1,201 3,603

Actual 2008-09 Total Credit Hours (1) N/A 974 N/A 1,043 N/A 519 845 2,536

Actual 2009-10 Total Credit Hours (1) N/A 565 N/A 824 N/A 567 652 1,956

Actual 2010-11 Total Credit Hours (1) N/A 736 N/A 1,098 N/A 412 749 2,246


Total Credit Hours (1) N/A 700 N/A 1,000 N/A 500 733 2,200

Gen Ed Credit Hours (1) N/A 459 603 473 372 608 503 2,515

Associates Credit Hours (2) N/A 0 0 71 60 70 40 201

Total Credit Hours N/A 459 603 544 432 678 543 2,716

Gen Ed Credit Hours (1) 765 870 870 885 900 885 882 5,175

Associates Credit Hours (2) 0 0 0 0 0 0 0 0

Total Credit Hours 765 870 870 885 900 885 882 5,175

(1) The credit hours on this schedule include inSPIRE "pre-groupers" or "post-groupers," who are taking only general education courses. These credit hours do not include core inSPIRE courses, which are included in the inSPIRE core enrollment projections. Based on historical trends, the number of credit hours taken by inSPIRE students has averaged around 34 percent of the core degree completion credit hours. However, for the first four terms occurring in fiscal year 2011-12, under the new six-term model, the number of credit hours taken by degree completion students has averaged 61 percent of the core degree completion credit hours. To be conservative and because of the uncertainty as to how this ratio might be affected as the new six-term model continues, a ratio of 50% will be used to project inSPIRE gen ed credit hours for the remainder of 2011-12and for 2012-13.

(2) Beginning in academic year 2011-12, a new category of online credit hours are being added to this schedule, for students pursuing an Associates degree.The College introduced the Associates curriculum in January 2012. To be conservative, for 2012-13 no Associates credit hours are being budgeted.

(3) Prior to fall 2011, the inSpire program basically had one fall term, one spring term, and one summer term. Even during the period when start dates varied, all starts were close enough to the beginning of the traditional semester that division of semesters into terms was not necessary. Under the new model, beginning in academic year 2011-12, each traditional semester will have two official starting points, giving rise to two terms per semester, including summer. Summer 2 for each academic year actually begins in July each year; therefore, this term is the first term in each fiscal year. Since the new model began in fall 2011 with fall term 1, a summer term 2 did not exist for 2011-12. General education and Associates courses will follow this new six-start per fiscal year model as well.

inSPIRE STUDENTS TAKING GEN EDS AND STUDENTS PURSUING ASSOCIATES (1) (2)

(3) 4/2012 Projected Budget 2011-12

(Fall Term 1, Fall Term 2, Spring Term 1, and Spring

Term 2 numbers are actual)


inSPIRE Students Taking General Education Courses and Students Pursuing AssociatesApril 2012

(3) Spring Preliminary

Budget 2012-13

2012-2013 July August September October November December January February March April May JuneBudget Income Account Title Projected Bdgt 2012 2012 2012 2012 2012 2012 2013 2013 2013 2013 2013 2013

(a) Traditional Tuition & Fees $10,057,500 $2,514,375 $628,594 $628,594 $628,594 $628,594 $2,514,375 $628,594 $628,594 $628,594 $628,594

(b) inSpire Tuition & Fees $3,486,250 $512,550 $582,900 $582,900 $592,950 $603,000 $611,950

(c) Associate's/General Education Tuition & Fees $1,733,625 $256,275 $291,450 $291,450 $296,475 $301,500 $296,475

(d) Fundraising Income $500,000 $20,833 $20,833 $20,833 $20,833 $20,833 $166,667 $20,833 $20,833 $20,833 $20,833 $20,833 $125,000(e) Unrestricted Endow ment Income $94,000 $47,000 $47,000(f) Interest Income $2,000 $167 $167 $167 $167 $167 $167 $167 $167 $167 $167 $167 $167

(a) Residence Hall Income $1,018,680 $254,670 $63,668 $63,668 $63,668 $63,668 $254,670 $63,668 $63,668 $63,668 $63,668(a) Food Service Income $1,446,500 $361,625 $90,406 $90,406 $90,406 $90,406 $361,625 $90,406 $90,406 $90,406 $90,406(a) Campus Store Income $296,500 $148,250 $148,250(g) Special Events Income $76,500 $38,250 $38,250

(h) Fine Arts Community School (FACS) $25,000 $6,250 $6,250 $6,250 $6,250(f) Rental Property $13,000 $1,083 $1,083 $1,083 $1,083 $1,083 $1,083 $1,083 $1,083 $1,083 $1,083 $1,083 $1,083(i) Federal Program Administrative Allow ance $6,500 $6,500(f) Miscellaneous Income $5,000 $417 $417 $417 $417 $417 $417 $417 $417 $417 $417 $417 $417

Total Cash Budget Income before Scholarships $18,761,055 $835,825 $4,182,020 $805,168 $1,679,518 $852,168 $951,001 $4,190,845 $805,168 $1,722,418 $805,168 $1,760,593 $171,167

(j) Deduct Unfunded Scholarships from Revenue ($4,434,648) ($1,108,662) ($277,166) ($277,166) ($277,166) ($277,166) ($1,108,662) ($277,166) ($277,166) ($277,166) ($277,166)

Total Cash Budget Income $14,326,407 $835,825 $3,073,358 $528,002 $1,402,352 $575,002 $673,835 $3,082,183 $528,002 $1,445,252 $528,002 $1,483,427 $171,167

(f) Release of Restrictions for Operating Items $150,000 $12,500 $12,500 $12,500 $12,500 $12,500 $12,500 $12,500 $12,500 $12,500 $12,500 $12,500 $12,500

Total Cash Expense Budgeted (separate page) ($13,615,455) ($967,653) ($1,257,819) ($1,144,144) ($1,144,144) ($1,144,144) ($1,144,144) ($1,256,019) ($1,144,144) ($1,145,944) ($1,144,144) ($1,155,507) ($967,653)

Operating Cash Flow Surplus (Deficit) $860,952 ($119,328) $1,828,039 ($603,642) $270,708 ($556,642) ($457,808) $1,838,664 ($603,642) $311,808 ($603,642) $340,420 ($783,986)

(k) Principal Payments on Debt ($70,000) ($5,833) ($5,833) ($5,833) ($5,833) ($5,833) ($5,833) ($5,833) ($5,833) ($5,833) ($5,833) ($5,833) ($5,833)(l) Cash Additions to USDA Debt Reserve ($34,020) ($2,835) ($2,835) ($2,835) ($2,835) ($2,835) ($2,835) ($2,835) ($2,835) ($2,835) ($2,835) ($2,835) ($2,835)(m) Essential Capital Purchases ($632,000) ($316,000) ($15,800) ($15,800) ($15,800) ($15,800) ($158,000) ($15,800) ($15,800) ($15,800) ($15,800) ($15,800) ($15,800)

Net Operating Cash Flow Surplus (Deficit) $124,932 ($443,996) $1,803,571 ($628,110) $246,240 ($581,110) ($624,477) $1,814,196 ($628,110) $287,340 ($628,110) $315,951 ($808,455)

Cumulative FY Oprtng Cash Flow Projection $124,932 ($443,996) $1,359,575 $731,465 $977,705 $396,595 ($227,882) $1,586,315 $958,205 $1,245,545 $617,435 $933,386 $124,932

(a) Tradi tional undergraduate semesters begin in Aug & Jan; some students participate in the Tui tionPay plan, so some payments are received throughout the semester. Students do not charge at the Campus Store.(b) inSpire terms have s ix s tart dates during the year; fewer of these s tudents participate in the Tui tionPay payment plan.(c) Associate's/Genera l Education terms have s ix s tart dates during the year.(d) The bulk of contributions are received in December (ca lendar year-‐end, relative to donor tax deductions) and in May-‐June (fi sca l year-‐end "ask push.")(e) Whi le endowment payout can be requested at any time during the year, the Col lege plans to request one-‐hal f the payout around November and the other one-‐hal f around May.(f) Revenue source projected to be earned evenly over the year.(g) The bulk of specia l program activi ty occurs in June and July (e.g., summer camps, etc.).(h) Fine Arts Community School programs typica l ly begin in late summer/early fa l l , spring, and early summer.(i ) Federa l program overhead a l lowance i s col lected late in the academic year.(j) Whi le the bulk of scholarships are posted at the beginning of each tradi tional semester, some students participate in the Tui tionPay payment plan, so the scholarship postings affect their ba lances due throughout the semester. (k) Debt principa l payments are not included in the operating budget; payments are projected to be made evenly over the year (monthly payments).(l ) The USDA financing requires accumulation of a debt reserve fund; additions are made monthly.(m) These capita l purchases wi l l be made throughout the year, with priori ty placed on insta l l ing them during academic breaks .

Bluefield College

2012-2013 Projected Budget Income - Cash Flow Analysis

(Based on 2012-13 Spring Preliminary Budget for Approval by Board at April 2012 Meeting)

2012-2013 July August September October November December January February March April May JuneBudget Expense Category Projected Bdgt 2012 2012 2012 2012 2012 2012 2013 2013 2013 2013 2013 2013

(a) Instruction Allocation (e.g., Postage) ($5,500) ($550) ($550) ($550) ($550) ($550) ($550) ($550) ($550) ($550) ($550)(a) Fine Arts ($46,493) ($4,649) ($4,649) ($4,649) ($4,649) ($4,649) ($4,649) ($4,649) ($4,649) ($4,649) ($4,649)(a) Language, Lit., & Communications ($17,917) ($1,792) ($1,792) ($1,792) ($1,792) ($1,792) ($1,792) ($1,792) ($1,792) ($1,792) ($1,792)(a) Christian Studies ($1,715) ($172) ($172) ($172) ($172) ($172) ($172) ($172) ($172) ($172) ($172)(a) Science ($13,862) ($1,386) ($1,386) ($1,386) ($1,386) ($1,386) ($1,386) ($1,386) ($1,386) ($1,386) ($1,386)(a) Social Science ($4,160) ($416) ($416) ($416) ($416) ($416) ($416) ($416) ($416) ($416) ($416)(a) Education ($8,389) ($839) ($839) ($839) ($839) ($839) ($839) ($839) ($839) ($839) ($839)(a) Exercise & Sport Science ($3,156) ($316) ($316) ($316) ($316) ($316) ($316) ($316) ($316) ($316) ($316)(a) Business ($1,910) ($191) ($191) ($191) ($191) ($191) ($191) ($191) ($191) ($191) ($191)(b) inSPIRE - General/Shared Expenses ($10,537) ($878) ($878) ($878) ($878) ($878) ($878) ($878) ($878) ($878) ($878) ($878) ($878)(b) inSPIRE - Public Safety ($70,325) ($5,860) ($5,860) ($5,860) ($5,860) ($5,860) ($5,860) ($5,860) ($5,860) ($5,860) ($5,860) ($5,860) ($5,860)(b) inSPIRE - Human Services ($67,255) ($5,605) ($5,605) ($5,605) ($5,605) ($5,605) ($5,605) ($5,605) ($5,605) ($5,605) ($5,605) ($5,605) ($5,605)(b) inSPIRE - Management ($70,475) ($5,873) ($5,873) ($5,873) ($5,873) ($5,873) ($5,873) ($5,873) ($5,873) ($5,873) ($5,873) ($5,873) ($5,873)(b) inSPIRE - Nursing ($105,500) ($8,792) ($8,792) ($8,792) ($8,792) ($8,792) ($8,792) ($8,792) ($8,792) ($8,792) ($8,792) ($8,792) ($8,792)

Total Instruction ($427,194) ($27,008) ($37,318) ($37,318) ($37,318) ($37,318) ($37,318) ($37,318) ($37,318) ($37,318) ($37,318) ($37,318) ($27,008)(a) Academic Support Allocation (e.g., Postage) ($3,500) ($350) ($350) ($350) ($350) ($350) ($350) ($350) ($350) ($350) ($350)(a) Academic Center for Excellence ($13,950) ($1,395) ($1,395) ($1,395) ($1,395) ($1,395) ($1,395) ($1,395) ($1,395) ($1,395) ($1,395)(b) inSPIRE, Associates/Gen Ed Academic Support ($410,651) ($34,221) ($34,221) ($34,221) ($34,221) ($34,221) ($34,221) ($34,221) ($34,221) ($34,221) ($34,221) ($34,221) ($34,221)(c) New Opportunity School for Women ($25,000) ($1,136) ($1,136) ($1,136) ($1,136) ($1,136) ($1,136) ($1,136) ($1,136) ($1,136) ($1,136) ($12,500) ($1,136)(d) Academic Affairs ($158,681) ($13,223) ($13,223) ($13,223) ($13,223) ($13,223) ($13,223) ($13,223) ($13,223) ($13,223) ($13,223) ($13,223) ($13,223)(a) International Studies ($11,211) ($1,121) ($1,121) ($1,121) ($1,121) ($1,121) ($1,121) ($1,121) ($1,121) ($1,121) ($1,121)(d) Library ($65,583) ($5,465) ($5,465) ($5,465) ($5,465) ($5,465) ($5,465) ($5,465) ($5,465) ($5,465) ($5,465) ($5,465) ($5,465)(d) Institutional Effectiveness ($1,525) ($127) ($127) ($127) ($127) ($127) ($127) ($127) ($127) ($127) ($127) ($127) ($127)(d) Academic Information Services and Technology ($55,150) ($4,596) ($4,596) ($4,596) ($4,596) ($4,596) ($4,596) ($4,596) ($4,596) ($4,596) ($4,596) ($4,596) ($4,596)

Total Academic Support ($745,251) ($58,769) ($61,635) ($61,635) ($61,635) ($61,635) ($61,635) ($61,635) ($61,635) ($61,635) ($61,635) ($72,999) ($58,769)(d) Student Services Central Purchases (e.g., Postage) ($30,000) ($2,500) ($2,500) ($2,500) ($2,500) ($2,500) ($2,500) ($2,500) ($2,500) ($2,500) ($2,500) ($2,500) ($2,500)(d) Registrar ($6,145) ($512) ($512) ($512) ($512) ($512) ($512) ($512) ($512) ($512) ($512) ($512) ($512)(d) Enrollment Management ($241,892) ($20,158) ($20,158) ($20,158) ($20,158) ($20,158) ($20,158) ($20,158) ($20,158) ($20,158) ($20,158) ($20,158) ($20,158)(d) Creative Media ($14,150) ($1,179) ($1,179) ($1,179) ($1,179) ($1,179) ($1,179) ($1,179) ($1,179) ($1,179) ($1,179) ($1,179) ($1,179)(d) Financial Aid ($10,303) ($859) ($859) ($859) ($859) ($859) ($859) ($859) ($859) ($859) ($859) ($859) ($859)(b) Student Services ($12,474) ($1,247) ($1,247) ($1,247) ($1,247) ($1,247) ($1,247) ($1,247) ($1,247) ($1,247) ($1,247)(d) Campus Security ($4,250) ($354) ($354) ($354) ($354) ($354) ($354) ($354) ($354) ($354) ($354) ($354) ($354)(b) Bonner Program ($1,300) ($130) ($130) ($130) ($130) ($130) ($130) ($130) ($130) ($130) ($130)(b) Student Activities ($74,066) ($7,407) ($7,407) ($7,407) ($7,407) ($7,407) ($7,407) ($7,407) ($7,407) ($7,407) ($7,407)(b) Campus Minister ($3,500) ($350) ($350) ($350) ($350) ($350) ($350) ($350) ($350) ($350) ($350)(b) Athletics (including Sports Information) ($722,227) ($72,223) ($72,223) ($72,223) ($72,223) ($72,223) ($72,223) ($72,223) ($72,223) ($72,223) ($72,223)

Total Student Services ($1,120,307) ($25,562) ($106,918) ($106,918) ($106,918) ($106,918) ($106,918) ($106,918) ($106,918) ($106,918) ($106,918) ($106,918) ($25,562)(d) Institution Support Allocation (e.g., Postage) ($17,000) ($1,417) ($1,417) ($1,417) ($1,417) ($1,417) ($1,417) ($1,417) ($1,417) ($1,417) ($1,417) ($1,417) ($1,417)(d) President's Office ($43,500) ($3,625) ($3,625) ($3,625) ($3,625) ($3,625) ($3,625) ($3,625) ($3,625) ($3,625) ($3,625) ($3,625) ($3,625)(d) Church Relations ($1,415) ($118) ($118) ($118) ($118) ($118) ($118) ($118) ($118) ($118) ($118) ($118) ($118)(d) Advancement ($58,475) ($4,873) ($4,873) ($4,873) ($4,873) ($4,873) ($4,873) ($4,873) ($4,873) ($4,873) ($4,873) ($4,873) ($4,873)(d) Capital Campaign ($4,500) ($375) ($375) ($375) ($375) ($375) ($375) ($375) ($375) ($375) ($375) ($375) ($375)(d) Alumni ($32,525) ($2,710) ($2,710) ($2,710) ($2,710) ($2,710) ($2,710) ($2,710) ($2,710) ($2,710) ($2,710) ($2,710) ($2,710)(d) Public Relations ($50,000) ($4,167) ($4,167) ($4,167) ($4,167) ($4,167) ($4,167) ($4,167) ($4,167) ($4,167) ($4,167) ($4,167) ($4,167)(d) Business Office ($19,400) ($1,617) ($1,617) ($1,617) ($1,617) ($1,617) ($1,617) ($1,617) ($1,617) ($1,617) ($1,617) ($1,617) ($1,617)(d) Administrative Information Services and Technology ($192,740) ($16,062) ($16,062) ($16,062) ($16,062) ($16,062) ($16,062) ($16,062) ($16,062) ($16,062) ($16,062) ($16,062) ($16,062)(d) General Institutional Support ($436,850) ($36,404) ($36,404) ($36,404) ($36,404) ($36,404) ($36,404) ($36,404) ($36,404) ($36,404) ($36,404) ($36,404) ($36,404)

Total Institutional Support ($856,405) ($71,367) ($71,367) ($71,367) ($71,367) ($71,367) ($71,367) ($71,367) ($71,367) ($71,367) ($71,367) ($71,367) ($71,367)(e) Bad Debt Expense ($50,000) ($25,000) ($25,000)(d) Institutional - Depreciation Expense ($776,000) ($64,667) ($64,667) ($64,667) ($64,667) ($64,667) ($64,667) ($64,667) ($64,667) ($64,667) ($64,667) ($64,667) ($64,667)(f) Interest Expense ($315,000) ($26,250) ($26,250) ($26,250) ($26,250) ($26,250) ($26,250) ($26,250) ($26,250) ($26,250) ($26,250) ($26,250) ($26,250)(f) USDA Debt Principal (Capital Lease Principal in IST) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0(d) Maintenance ($1,098,000) ($91,500) ($91,500) ($91,500) ($91,500) ($91,500) ($91,500) ($91,500) ($91,500) ($91,500) ($91,500) ($91,500) ($91,500)(a) Residence Life ($189,675) ($18,968) ($18,968) ($18,968) ($18,968) ($18,968) ($18,968) ($18,968) ($18,968) ($18,968) ($18,968)(g) Campus Store ($223,750) ($111,875) ($111,875)(a) Food Service ($844,000) ($84,400) ($84,400) ($84,400) ($84,400) ($84,400) ($84,400) ($84,400) ($84,400) ($84,400) ($84,400)(h) Special Programs ($39,220) ($19,610) ($19,610)(j) Fine Arts Community School (FACS) ($7,200) ($1,800) ($1,800) ($1,800) ($1,800)

Total Auxillary ($1,303,845) ($21,410) ($217,043) ($103,368) ($103,368) ($103,368) ($103,368) ($215,243) ($103,368) ($105,168) ($103,368) ($103,368) ($21,410)(d) Salaries ($6,010,380) ($500,865) ($500,865) ($500,865) ($500,865) ($500,865) ($500,865) ($500,865) ($500,865) ($500,865) ($500,865) ($500,865) ($500,865)(d) Employee Benefits ($1,739,074) ($144,923) ($144,923) ($144,923) ($144,923) ($144,923) ($144,923) ($144,923) ($144,923) ($144,923) ($144,923) ($144,923) ($144,923)(i) Unfunded Aid Scholarships ($4,434,648) ($1,108,662) ($277,166) ($277,166) ($277,166) ($277,166) ($1,108,662) ($277,166) ($277,166) ($277,166) ($277,166)(i) Deduct Unfunded Scholarships from Revenue $4,434,648 $1,108,662 $277,166 $277,166 $277,166 $277,166 $1,108,662 $277,166 $277,166 $277,166 $277,166

Total Budget Expense ($14,441,455) ($1,032,320) ($1,322,485) ($1,208,810) ($1,208,810) ($1,208,810) ($1,233,810) ($1,320,685) ($1,208,810) ($1,210,610) ($1,208,810) ($1,220,174) ($1,057,320)(d) Minus Depreciation Expense Budgeted $776,000 $64,667 $64,667 $64,667 $64,667 $64,667 $64,667 $64,667 $64,667 $64,667 $64,667 $64,667 $64,667(e) Minus Bad Debt Reserve Expense $50,000 $0 $0 $0 $0 $0 $25,000 $0 $0 $0 $0 $0 $25,000

Total Cash Expenses Budgeted ($13,615,455) ($967,653) ($1,257,819) ($1,144,144) ($1,144,144) ($1,144,144) ($1,144,144) ($1,256,019) ($1,144,144) ($1,145,944) ($1,144,144) ($1,155,507) ($967,653)

(a) Academic and s tudent expenditures for tradi tional undergraduate programs are projected to be spent evenly over the approximate 10 months of the tradi tional academic year.(b) Academic and s tudent expenditures for inSPIRE and AGEO programs are projected to be spent evenly over the approximate 12 months of the continuous academic year for those programs.(c) The NOSW program wi l l be held in May each year; some expenditures wi l l occur throughout the year in preparation, and the bulk wi l l occur in May.(d) Year-‐round office/operations are projected to be spent evently over the 12 months of the enti re fi sca l year.(e) Bad debts are analyzed most thoroughly at the end of each tradi tional academic semester; therefore, wri te-‐offs tend to occur in December and June.(f) Interest and principa l amounts are projected to be spent evenly over the 12 months of the enti re fi sca l year.(g) The bulk of Campus Store sa les are textbooks at the beginning of each semester.(h) The bulk of specia l program activi ty occurs in June and July (e.g., summer camps, etc.).(i ) Whi le the bulk of scholarships are posted at the beginning of each tradi tional semester, some students participate in the Tui tionPay payment plan, so the scholarship postings affect their ba lances due throughout the semester. (j) Fine Arts Community School programs typica l ly begin in late summer/early fa l l , spring, and early summer.

Bluefield College

2012-2013 Projected Budget Expenses - Cash Flow Analysis

(Based on 2012-13 Spring Preliminary Budget for Approval by Board at April 2012 Meeting)

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