State of North Carolina June 30, 2018
BALANCE SHEET
GOVERNMENTAL FUNDS
June 30, 2018 Exhibit B-1(Dollars in Thousands)
Highway Other Total
General Highway Trust Governmental Governmental
Fund Fund Fund Funds Funds
AssetsCash and cash equivalents (Note 3)................................... 5,364,588 $ 132,327 $ 1,360,957 $ 1,074,584 $ 7,932,456 $
Investments (Note 3).......................................................... 6,631 — — 284,764 291,395
Securities lending collateral (Note 3)................................... 9,522 216 1,744 982 12,464
Receivables, net: (Note 4)Taxes receivable.............................................................. 2,011,662 134,953 58,953 5,801 2,211,369
Accounts receivable......................................................... 272,568 16,673 46 18,920 308,207
Intergovernmental receivable............................................ 914,505 76,569 6 2,551 993,631
Interest receivable............................................................ 10,508 227 1,891 1,730 14,356
Contributions receivable................................................... 84 — — — 84
Other receivables............................................................. — 5,080 — — 5,080 Due from other funds (Note 10)........................................... 29,757 20,718 343,237 7,539 401,251
Due from component units (Note 18)................................... 7 — — — 7
Inventories........................................................................... 68,159 88,103 — 17,713 173,975
Advances to other funds (Note 10)...................................... — — 27,763 — 27,763 Advances to component units.............................................. — 3,035 — — 3,035
Notes receivable, net (Note 4)............................................. 24,106 130 30 36,457 60,723
Securities held in trust......................................................... 40 1,601 — 47,505 49,146
Restricted/designated cash and cash equivalents (Note 3).. 255,289 — — 402,274 657,563
Restricted investments (Note 3).......................................... 1,991 14,094 — 334,954 351,039
Total Assets........................................................................ 8,969,417 493,726 1,794,627 2,235,774 13,493,544
Deferred Outflows of ResourcesForward funded state aid..................................................... 145,945 — — 37,287 183,232
Total Assets and Deferred Outflows.................................... 9,115,362 $ 493,726 $ 1,794,627 $ 2,273,061 $ 13,676,776 $
LiabilitiesAccounts payable and accrued liabilities:
Accounts payable............................................................. 201,897 $ 366,218 $ 105,084 $ 40,357 $ 713,556 $
Accrued payroll................................................................. 1,506 29,124 — 51 30,681
Intergovernmental payable............................................... 810,363 159,680 4,426 6,558 981,027
Claims payable................................................................. — — — 61,000 61,000
Medical claims payable....................................................... 967,581 — — — 967,581
Tax refunds payable............................................................ 997,142 7,315 2,988 — 1,007,445
Obligations under securities lending.................................... 9,522 216 1,744 982 12,464
Due to fiduciary funds (Note 10).......................................... 105,308 10,112 — — 115,420
Due to other funds (Note 10)............................................... 41,920 277,765 13,104 168 332,957
Due to component units (Note 18)....................................... 5,032 — — 10,379 15,411
Unearned revenue............................................................... 368,556 18,448 8,097 689 395,790
Deposits payable................................................................. 2,719 — — 5 2,724
Funds held for others........................................................... 16,194 13,018 — 47,591 76,803
Total Liabilities..................................................................... 3,527,740 881,896 135,443 167,780 4,712,859
Deferred Inflows of ResourcesUnavailable revenue............................................................ 198,251 1,863 — 6,236 206,350
Fund Balances (Note 11)Nonspendable..................................................................... 70,193 88,103 — 136,611 294,907
Restricted............................................................................ 136,629 17,200 — 996,147 1,149,976
Committed........................................................................... 2,329,651 — 1,659,184 962,838 4,951,673
Assigned............................................................................. 517,815 — — 3,449 521,264
Unassigned......................................................................... 2,335,083 (495,336) — — 1,839,747
Total Fund Balances............................................................ 5,389,371 (390,033) 1,659,184 2,099,045 8,757,567
Total Liabilities, Deferred Inflows and Fund Balances.......... 9,115,362 $ 493,726 $ 1,794,627 $ 2,273,061 $ 13,676,776 $
The accompanying Notes to the Financial Statements are an integral part of this statement.
52525252
State of North Carolina
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET POSITION
June 30, 2018 Exhibit B-1a(Dollars in Thousands)
Total fund balances - governmental funds (see Exhibit B-1) 8,757,567$
Amounts reported for governmental activities in the Statement of Net Position are different because:
– Capital assets used in governmental activities are not financial resources and,
therefore, are not reported in the funds (see Note 5). These consist of:
Cost of capital assets (excluding internal service funds)........................................................... 52,387,275$
Less: Accumulated depreciation (excluding internal service funds).......................................... (718,624)
Net capital assets............................................................................................................... 51,668,651
– Some assets, such as receivables, are not available soon enough to pay for current
period expenditures and thus, are offset by unavailable revenue in the governmental funds. 206,350
– Equity interest in component unit is not a financial resource and, therefore, is not
reported in the funds. 410,255
– Net OPEB asset (excluding internal service funds) resulting from contributions in excess
of the actuarially determined contribution are not financial resources and, therefore, are
not reported in the funds (see Note 14). 11,322
– Deferred losses on refundings are reported in the Statement of Net Position (to be
amortized as interest expense) but are not reported in the funds. 104,194
– Deferred outflows for pensions (excluding internal service funds) are reported in
the Statement of Net Position but are not reported in the funds (see Note 12). 1,063,894
– Deferred outflows for OPEB (excluding internal service funds) are reported in
the Statement of Net Position but are not reported in the funds (see Note 14). 546,765
– Long-term debt instruments, such as bonds and notes payable, are not due and
payable in the current period and, therefore, the outstanding balances are not reported
in the funds (see Note 8). Also, unamortized debt premiums are reported in the
Statement of Net Position but are not reported in the funds. These balances consist of:
General obligation bonds payable............................................................................................. (2,441,685)
Limited obligation bonds payable.............................................................................................. (1,783,975)
GARVEE bonds payable........................................................................................................... (516,820)
Unamortized debt premiums (to be amortized as interest expense)......................................... (468,508)
Notes payable............................................................................................................................ (50,623)
Capital leases payable (excluding internal service funds)......................................................... (15,988)
Net long-term debt............................................................................................................. (5,277,599)
– Other liabilities not due and payable in the current period and, therefore, not reported
in the funds (see Note 8 as applicable) consist of:
Accrued interest payable........................................................................................................... (30,875)
Compensated absences (excluding internal service funds)...................................................... (438,699)
Obligations for workers' compensation...................................................................................... (717,941)
Death benefit payable................................................................................................................ (40)
Pollution remediation payable.................................................................................................... (8,571)
Claims and judgments payable................................................................................................. (731,703)
Pension liability (excluding internal service funds).................................................................... (2,080,912)
Net OPEB liability (excluding internal service funds)................................................................. (6,229,491)
Total other liabilities........................................................................................................... (10,238,232)
– Deferred inflows for pensions (excluding internal service funds) are reported in
the Statement of Net Position but are not reported in the funds (see Note 12). (100,017)
– Deferred inflows for OPEB (excluding internal service funds) are reported in
the Statement of Net Position but are not reported in the funds (see Note 14). (2,208,649)
– Internal service funds are used by management to charge the costs of certain
activities to individual funds. The assets and liabilities of the internal service funds
are included in governmental activities in the Statement of Net Position (see Exhibit B-3). 204,116
Total net position - governmental activities (see Exhibit A-1) 45,148,617$
The accompanying Notes to the Financial Statements are an integral part of this statement.
June 30, 2018
53535353
State of North Carolina June 30, 2018
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
For the Fiscal Year Ended June 30, 2018 Exhibit B-2(Dollars in Thousands)
Highway Other Total
General Highway Trust Governmental Governmental
Fund Fund Fund Funds Funds
Revenues
Taxes:
Individual income tax................................................... 12,607,563 $ — $ — $ — $ 12,607,563 $
Corporate income tax.................................................. 749,488 — — — 749,488
Sales and use tax....................................................... 7,940,757 — — 8,411 7,949,168
Gasoline tax................................................................ — 1,413,804 573,949 25,846 2,013,599
Franchise tax.............................................................. 669,598 — — — 669,598
Highway use tax.......................................................... — — 798,314 — 798,314
Insurance tax.............................................................. 588,907 — — — 588,907
Beverage tax............................................................... 411,161 — — — 411,161
Tobacco products tax.................................................. 292,284 — — — 292,284
Other taxes................................................................. 206,598 — — 114,496 321,094
Federal funds................................................................. 15,626,073 1,271,290 — 90,158 16,987,521
Local funds.................................................................... 139,422 23,743 897 8,753 172,815
Investment earnings....................................................... 107,317 8,155 22,320 11,182 148,974
Interest earnings on loans.............................................. 332 — 315 328 975
Sales and services......................................................... 179,641 4,872 — 152,439 336,952
Rental and lease of property.......................................... 13,857 4,036 1,211 2,817 21,921
Fees, licenses, and fines............................................... 802,002 818,919 142,620 183,945 1,947,486
Tobacco settlement........................................................ 160,653 — — — 160,653
Contributions, gifts, and grants....................................... 44,088 16,475 96 50,080 110,739
Funds escheated........................................................... — — — 105,127 105,127
Miscellaneous................................................................ 143,325 8,919 2,214 2,838 157,296
Total revenues......................................................... 40,683,066 3,570,213 1,541,936 756,420 46,551,635
Expenditures
Current:
General government................................................... 1,148,205 — — 46,881 1,195,086
Primary and secondary education............................... 11,022,159 — — — 11,022,159
Higher education......................................................... 4,204,444 — — 185,911 4,390,355
Health and human services......................................... 19,054,530 — — 66,753 19,121,283
Economic development............................................... 500,251 — — 5,444 505,695
Environment and natural resources............................. 421,528 — — 147,300 568,828
Public safety, corrections, and regulation.................... 3,102,590 — — 279,609 3,382,199
Transportation............................................................. — 4,147,490 1,522,115 — 5,669,605
Agriculture................................................................... 184,669 — — 17,923 202,592
Capital outlay................................................................. — — — 129,798 129,798
Debt service:
Principal retirement..................................................... 662,396 258,460 45,332 60 966,248
Interest and fees......................................................... 207,921 25,196 6,837 59 240,013
Debt issuance costs.................................................... 1,425 561 — — 1,986
Total expenditures.................................................... 40,510,118 4,431,707 1,574,284 879,738 47,395,847
Excess revenues over (under) expenditures................... 172,948 (861,494) (32,348) (123,318) (844,212)
Other Financing Sources (Uses)
Refunding bonds issued................................................. 724,560 224,640 — — 949,200
Other debt issued........................................................... 642 32,303 — — 32,945
Premium on debt issued................................................ 152,357 28,508 — — 180,865
Payment to refunded bond escrow agent....................... (706,188) (68,007) — — (774,195)
Sale of capital assets..................................................... 8,428 12,248 1,040 151 21,867
Insurance recoveries...................................................... 23,299 10,763 — 780 34,842
Transfers in (Note 10).................................................... 814,256 30,717 — 202,411 1,047,384
Transfers out (Note 10).................................................. (202,601) (46,308) (79,929) (111,128) (439,966)
Total other financing sources (uses)........................ 814,753 224,864 (78,889) 92,214 1,052,942
Net change in fund balances.......................................... 987,701 (636,630) (111,237) (31,104) 208,730
Fund balances — July 1, as restated (Note 23)............. 4,401,670 246,597 1,770,421 2,130,149 8,548,837
Fund balances — June 30............................................. 5,389,371 $ (390,033)$ 1,659,184 $ 2,099,045 $ 8,757,567 $
The accompanying Notes to the Financial Statements are an integral part of this statement.
54545454
State of North Carolina
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
For the Fiscal Year Ended June 30, 2018 Exhibit B-2a
(Dollars in Thousands)
Net change in fund balances - total governmental funds (see Exhibit B-2) 208,730$
Amounts reported for governmental activities in the Statement of Activities are different because:
– Capital outlays are reported as expenditures in governmental funds. However, in the
Statement of Activities, the cost of capital assets is allocated over their estimateduseful lives as depreciation expense. In the current period, these amounts are:
Capital outlays (including construction-in-progress) ............................................................. 3,384,388$ Less: Depreciation expense (excluding internal service funds) ............................................ (929,460)
Net capital outlay adjustment ........................................................................................ 2,454,928
– Proceeds from the sale of capital assets increase financial resources in the funds,
whereas in the Statement of Activities only the gain or loss on the sale is reported. Thisadjustment reduces the proceeds by the book value of the capital assets sold. (69,413)
– Donations of capital assets do not appear in the governmental funds because they
are not financial resources, but increase net position in the Statement of Activities. 7,813
– Pension Contributions (excluding internal service funds) to defined benefit
pension plans in the current fiscal year are not included on the Statement of Activities. 418,831
– OPEB Contributions (excluding internal service funds) to defined benefit
OPEB plans in the current fiscal year are not included on the Statement of Activities. 215,246
– Benefit payments to the special separation allowance defined benefit pension plan
in the current fiscal year are not included on the Statement of Activities (see Note 12). 16,139
– Long-term debt proceeds provide current financial resources to governmental funds,
while the repayment of the related debt principal consumes those financial resources.These transactions, however, have no effect on net position. Also, governmental fundsreport the effect of premiums and similar items when debt is first issued, whereas theseamounts are deferred and amortized in the Statement of Activities. In the current period,these amounts consist of:
Debt issued or incurred:
Notes and capital leases issued ....................................................................................... (32,945) Refunding bonds issued ................................................................................................... (949,200) Premiums on debt issued ................................................................................................. (180,865)
Principal repayments:Bonds, notes, and similar debt ......................................................................................... 961,614 Capital leases (excluding internal service funds) .............................................................. 4,634 Payments to escrow agent for refundings ........................................................................ 774,195
Net debt adjustments .................................................................................................... 577,433
– Some revenues in the Statement of Activities do not provide current financial
resources and, therefore, are deferred inflows of resources in the funds.Also, revenues related to prior periods that became available during the current periodare reported in the funds but are eliminated in the Statement of Activities. This amountis the net adjustment. 19,271
– Change in equity interest of component unit resulting from changes in stockholder's
equity are not current financial resources, and therefore, are not recognized in the funds. 222,404
– Some expenses reported in the Statement of Activities do not require the use of
current financial resources and, therefore, are not recognized in the funds. Also,some payments related to prior periods are recognized in the funds but are eliminatedin the Statement of Activities. In the current period, the net adjustments consist of:
Accrued interest ................................................................................................................... 9,643 Compensated absences (excluding internal service funds) ................................................. (12,494) Workers' compensation ........................................................................................................ 28,551 Pension expense (excluding internal service funds) ............................................................. (539,771) OPEB expense (excluding internal service funds) ................................................................ (362,900) Pollution remediation ............................................................................................................ 39 Claims and judgments .......................................................................................................... 2,300 Amortization of deferred amounts ........................................................................................ 91,857
Net expense accruals ................................................................................................... (782,775)
– Internal service funds are used by management to charge the costs of certain
activities to individual funds. The net revenues of internal service funds areincluded with governmental activities in the Statement of Activities (see Exhibit B-4). (19,151)
Change in net position - governmental activities (see Exhibit A-2) 3,269,456$
The accompanying Notes to the Financial Statements are an integral part of this statement.
June 30, 2018
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