Cornell University 2011-2012 Annual Report - DFA Home - Cornell ...

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(dollars in thousands)K. Sponsored AgreementsRevenues under grants, contracts, and similar agreements are recognized at the time expenditures are incurred. Theserevenues include the recovery of facilities and administrative costs, which are recognized according to negotiated predeterminedrates. Amounts received in advance in excess of incurred expenditures are recorded as deferred revenues.L. Medical Physician OrganizationThe Medical Physician Organization provides the management structure for the practice of medicine in an academic medicalcenter. In addition to conducting instructional and research activities, physician members generate clinical practiceincome from their professional services to patients. Also reflected as University revenues are Medical Physician Organizationfees. Expenses of the clinical practice, including physician compensation, administrative operations, and provision foruncollectible accounts, are reflected as University expenses. Net assets resulting from the activities of the Medical PhysicianOrganization are designated for the respective clinical departments of the Medical College.M. Use of EstimatesThe preparation of financial statements in conformity with U.S. generally accepted accounting principles requires managementto make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expensesduring the reporting period. Management’s assumptions are primarily related to the appropriate discount rate for thepurposes of fair-value calculations, to allowances for doubtful accounts, and to self-insured risks. Actual results may differfrom those estimates.N. Comparative Financial InformationThe consolidated statement of activities includes prior-year information in summary form, rather than by restriction class.Such information does not include sufficient detail to constitute a presentation of prior-year data in conformity with U.S.generally accepted accounting principles. Accordingly, such information should be read in conjunction with the University’sconsolidated financial statements for the prior fiscal year, from which the summarized information was derived.O. Accounting PronouncementsEffective for the fiscal year ending June 30, 2012, the University has modified disclosures required by ASU 2010-06: Improvementsto Disclosures about Fair Value Measurements. The modified disclosures are reflected in the tables that summarizeLevel 3 activity within Note 3 and Note 6. The tables now separately disclose sales, purchases and, when applicable,issuances and settlements.The University complied with the requirements of ASU 2010-24: Presentation of Insurance Claims and Related InsuranceRecoveries. The ASU requires that potential insurance recoveries are reflected as assets and the insurance claims as liabilities.The netting of the recoveries and estimated liabilities is no longer acceptable. For fiscal year ending June 30, 2012, theMedical College recorded a reinsurance receivable of $70.2 million and a reinsurance payable of $70.2 million.P. ReclassificationsCertain prior-year amounts have been reclassified to conform to the current-year presentation.Q. Income TaxesThe University is a not-for-profit organization as described in Section 501(c)(3) of the Internal Revenue Code and isgenerally exempt from income taxes on related income pursuant to the appropriate sections of the Internal Revenue Code.In accordance with the accounting standards, the University evaluates its income tax position each fiscal year to determinewhether it is more likely than not to be sustained if examined by the applicable taxing authority. This review had no materialimpact on the University’s consolidated financial statements.16
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(dollars in thousands)2. RECEIVABLESA. Accounts ReceivableThe University’s receivables from the sources identified in the table below are reviewed and monitored for aging and otherfactors that affect collectability.Accounts receivable from the following sources were outstanding as of June 30:SUMMARY OF ACCOUNTS RECEIVABLE 2012 2011Grants and contracts $ 88,480 $ 125,727Collateral related to interest rate swap agreements - 26,461New York Presbyterian Hospital and other affiliates 37,179 57,758Patients (net of contractual allowances) 89,944 76,327Reinsurance Receivable 70,257 -Student accounts 6,193 3,561Other 56,416 41,916Gross accounts receivable $ 348,469 $ 331,750Less: allowance for doubtful accounts (29,180) (53,731)Net accounts receivable $ 319,289 $ 278,019The patient accounts receivable for medical services was comprised of the following at June 30, 2012 and 2011, respectively:commercial third parties 60.5 percent and 61.6 percent; federal/state government 15.9 percent and 15.4 percent; andpatients 23.7 percent and 23.0 percent.Other accounts receivable include receivables from other government agencies, matured bequests, and receivables fromother operating activities.B. Contributions ReceivableUnconditional promises to give, or pledges, are recorded in the consolidated financial statements at present value usingdiscount rates ranging from 1.7 percent to 7 percent. Contributions are expected to be realized as follows:SUMMARY OF CONTRIBUTIONS RECEIVABLE2012 2011Less than one year $ 299,374 $ 227,267Between one and five years 568,458 339,625More than five years 160,342 182,164Gross contributions receivable $ 1,028,174 $ 749,056Less: unamortized discount (92,233) (93,110)Less: allowance for uncollectible amounts (72,482) (71,463)Net contributions receivable $ 863,459 $ 584,483Contributions receivable as of June 30 are intended for the following purposes:EXPECTED PURPOSE OF CONTRIBUTIONS RECEIVABLE2012 2011Support of University operations $ 369,243 $ 227,233Capital purposes 308,360 174,887Endowments and similar funds 185,856 182,363Net contributions receivable $ 863,459 $ 584,483At June 30, 2012, conditional promises not reflected in the consolidated financial statements, which consistprimarily of bequest intentions and conditional promises with significant matching requirements, were $387,103.17
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CORNELL UNIVERSITY HIGHLIGHTS2011-1
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8Annual Report 2011-2012
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FROM TOP TO BOTTOM: Taio Cruz perfo
Page 16 and 17: Cornell Administration:FY12 Updates
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Page 26: esidents of Owego, New York, who we
Page 34: nearly three years early, according
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Page 42: ResearchResearchers connect geneto
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