FDTC receives clean audit, but needs enrollment boost
By Samantha Lyles
The Florence-Darlington Technical College (FDTC) Commission on Technical Education met on Jan. 28 and received the good news that the school’s most recent audit revealed no major accounting issues. However, lower enrollment numbers continue to slow Tech’s financial recovery.
Robin Poston of Georgetown CPA firm Harper, Poston, and Moree said the completed audit issued a “clean opinion” on Tech’s financial statement, meaning there were no violations of generally accepted accounting principles.
Under revenues and expenses, Poston said that in 2019, FDTC had operating expenses of $47 million (down from $53 million the previous year) and showed $17.4 million in operating revenue. This number decreased over the prior year due to drops in student fees, tuition, state and federal grants, and auxiliary income from textbook sales. Non-operating revenues held steady year-to-year at about $28 million. All told, the school’s net position decreased by $2.4 million in 2019.
“Your enrollment was down last year. When your enrollment’s down, tuition’s down, and everything has a trickle down effect,” said Poston, advising the commission to apply their energies to marketing and other strategies to improve enrollment. “Hopefully in the next couple of years, your enrollment will pick up and you can get to a break-even point.”
Poston said FDTC’s assets total about $66.4 million for 2019, down from about $68 million in 2018 – a decrease primarily due to those assets depreciating in value.
Current liabilities – “basically what you owe people,” said Poston – totaled $5.8 million, versus $4.9 the previous year. Non-current liabilities totaled $84.5 million, compared to $88.7 million in 2018 – a drop mainly due to a decrease in net pension liability.
That lower pension expense also helped plump up deferred inflows from $793,000 to $3.5 million, with amortization over a five year period.
Douglas Lange, FDTC VP of Business Affairs, followed up with current financial statements that show the school is gradually regaining its fiscal health.
“This year, we’re at about $8 million for revenues and expenditures, relative to about $5.7 (million) this same time last year. That’s a significant improvement on where we’ve been,” said Lange.
Lange added that the lower enrollment has forced Tech to cut expenses, and made it “very difficult” to show a positive net position year after year.
Interim president Ed Bethea said that while the audit and financial statements provide valuable information and guidelines, one of his top priorities is to keep improving the school’s “cash on hand” balance, ensuring FDTC has at least two month’s worth of operating expenses ready and available. Lange said estimated monthly expenses total about $3 million, and Tech now has about 45 days of cash on hand in the bank.
Commissioner Hood Temple lauded these efforts and noted that FDTC has been fighting to regain ground for a couple of years, since former president Ben Dillard resigned in March of 2018. Dillard’s term as president saw numerous fiscal troubles, including paying high fees to guest lecturers who were allegedly friends of Dillard, and budgeting procedures that incorrectly calculated enrollment revenues.
“Certainly the goal would be 60 days cash on hand, but if you’ll recall where we were – with only 4 days cash on hand – where we are now is a significant improvement,” said Temple. He credited the recovery to sound financial stewardship by the school’s senior administration and commission members.
“We’ve tightened up our belt…and we’re doing what we need to do for the number of students we have,” said Temple. “I think our stakeholders should be comforted by that.”