school district of the borough of haledon county of ... · january 22, 2019 citizens, honorable...

SCHOOL DISTRICT OF THE

BOROUGH OF HALEDON

COUNTY OF PASSAIC, NEW JERSEY

COMPREHENSIVE ANNUAL FINANCIAL REPORT

FOR THE FISCAL YEAR ENDED

JUNE 30, 2018

School Districtof the

Borough of Haledon

BOROUGH OF HALEDON BOARD OF EDUCATIONHALEDON, NEW JERSEY

Comprehensive Annual Financial ReportFor the Fiscal Year Ended June 30, 2018

Comprehensive Annual Financial Report

of the

BOROUGH OF HALEDON BOARD OF EDUCATIONHALEDON, NEW JERSEY

For the Fiscal Year Ended June 30, 2018

Prepared by

Borough of Haledon Board of EducationFinance Department

OUTLINE OF CAFR

INTRODUCTORY SECTION

Letter of Transmittal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Organizational Chart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Roster of Officials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Consultants and Advisors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

FINANCIAL SECTION

Independent Auditor's Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Required Supplementary Information - Part I

Management’s Discussion and Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

BASIC FINANCIAL STATEMENTS

A. District-wide Financial Statements:

A-1 Statement of Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

A-2 Statement of Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

B. Fund Financial Statements:

Governmental Funds:

B-1 Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

B-2 Statement of Revenues, Expenditures and Changes in Fund Balances . . . . . . . . . . . . 25

B-3 Reconciliation of the Statement of Revenues, Expenditures, and

Changes in Fund Balances of Governmental Funds to the

Statement of Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Proprietary Funds:

B-4 Statement of Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

B-5 Statement of Revenues, Expenses and Changes in Fund Net Position . . . . . . . . . . . . . 28

B-6 Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Fiduciary Funds:

B-7 Statement of Fiduciary Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

B-8 Statement of Changes in Fiduciary Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Notes to the Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Required Supplementary Information - Part II

OUTLINE OF CAFR

C. Budgetary Comparison Schedules:

C-1 Budgetary Comparison Schedule - General Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70

C-1a Not Applicable

C-2 Budgetary Comparison Schedule - Special Revenue Fund . . . . . . . . . . . . . . . . . . . . . . 75

Notes to the Required Supplementary Information

C-3 Budgetary Comparison Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76

Required Supplementary Information - Part III

L. Schedules Related to Accounting and Reporting for Pensions (GASB 68)

L-1 Schedule of the District's Proportionate Share of the Net Pension

Liability – PERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77

L-2 Schedule of District Contributions – PERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

L-3 Schedule of the District's Proportionate Share of the Net Pension

Liability – TPAF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

L-4 Notes to Required Schedules of Supplementary Information - Part III . . . . . . . . . . . . 80

Other Supplementary Information

D. School Level Schedules:

Not Applicable

E. Special Revenue Fund:

E-1 Combining Schedule of Program Revenues and Expenditures -

Budgetary Basis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81

E-1a Combining Schedule of Program Revenues and Expenditures -

Budgetary Basis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82

E-2 Schedule of Preschool Education Aid - Budgetary Basis . . . . . . . . . . . . . . . . . . . . . . . 83

F. Capital Projects Fund:

Not Applicable

G. Proprietary Funds:

Enterprise Fund:

G-1 Combining Statement of Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

G-2 Combining Statement of Revenues, Expenses and Changes in

Fund Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85

G-3 Combining Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86

OUTLINE OF CAFR

Internal Service Fund:

Not Applicable

H. Fiduciary Funds:

H-1 Combining Statement of Fiduciary Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87

H-2 Combining Statement of Changes in Fiduciary Net Position . . . . . . . . . . . . . . . . . . . . 88

H-3 Student Activity Agency Fund - Schedule of Receipts and

Disbursements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89

H-4 Payroll Agency Fund - Schedule of Receipts and Disbursements . . . . . . . . . . . . . . . . 90

I. Long-Term Debt:

I-1 Not Applicable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

J. Statistical Section (Unaudited)

Financial Trends

Introduction to the Statistical Section

J-1 Net Position by Component . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91

J-2 Changes in Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92

J-3 Fund Balances - Governmental Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94

J-4 Changes in Fund Balances - Governmental Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95

J-5 General Fund Other Local Revenue by Source . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96

Revenue Capacity

J-6 Assessed and Estimated Actual Value of Taxable Property . . . . . . . . . . . . . . . . . . . . . 97

J-7 Direct and Overlapping Property Tax Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98

J-8 Principal Property Taxpayers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

J-9 School Tax Levies and Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100

Debt Capacity

J-10 Ratios of Outstanding Debt by Type . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101

J-11 Ratios of Net General Bonded Debt Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102

J-12 Direct and Overlapping Governmental Activities Debt . . . . . . . . . . . . . . . . . . . . . . . . 103

J-13 Legal Debt Margin Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104

OUTLINE OF CAFR

J. Statistical Section (Unaudited), Continued

Demographic and Economic Information

J-14 Demographic and Economic Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105

J-15 Principal Employers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106

Operating Information

J-16 Full-time Equivalent District Employees by Function/Program . . . . . . . . . . . . . . . . . . 107

J-17 Operating Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108

J-18 School Building Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109

J-19 Schedule of Required Maintenance for School Facilities . . . . . . . . . . . . . . . . . . . . . . . . 110

J-20 Insurance Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111

K. SINGLE AUDIT SECTION

K-1 Independent Auditor’s Report on Internal Control Over Financial Reporting

and on Compliance and Other Matters Based on an Audit of Financial

Statements Performed in Accordance with Government Auditing

Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112

K-2 Independent Auditor’s Report on Compliance with Requirements Applicable

to Each Major Program and Internal Control Over Compliance in

Accordance with the Uniform Guidance and N.J. OMB Circular Letter

15-08 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114

K-3 Schedule of Expenditures of Federal Awards - Schedule A . . . . . . . . . . . . . . . . . . . . . . 117

K-4 Schedule of Expenditures of State Financial Assistance - Schedule B . . . . . . . . . . . . . . 118

K-5 Notes to the Schedules of Expenditures of Federal Awards and State

Financial Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119

K-6 Schedule of Findings and Questioned Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122

K-7 Schedule of Financial, Federal and State Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124

K-8 Summary Schedule of Prior Audit Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125

INTRODUCTORY SECTION

January 22, 2019 Citizens, Honorable President and Members of the Board of Education Borough of Haledon School District Haledon, NJ 07508 Dear Board Members: The comprehensive annual financial report of the Borough of Haledon School District (District) for the fiscal year ended June 30, 2018 is hereby submitted. Responsibility for both the accuracy of the data and completeness and fairness of the presentation, including all disclosures, rests with the management of the Board of Education (Board). To the best of our knowledge and belief, the data presented in this report is accurate in all material respects and is reported in a manner designed to present fairly the basic financial statements and results of operations of the District. All disclosures necessary to enable the reader to gain an understanding of the District’s financial activities have been included. The comprehensive annual financial report is presented in four sections: introductory, financial, statistical and single audit. The introductory section includes this transmittal letter, the District’s organizational chart and a list of principal officials. The financial section includes the management discussion and analysis, the basic financial statements and schedules, as well as the auditor’s report, thereon. The statistical section includes selected financial and demographic information, generally presented on a multi-year basis. The District is required to undergo an annual single audit in conformity with the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and the New Jersey OMB Circular NJOMB 15-08, Single Audit Policy for Recipients of Federal Grants, State Grants and State Aid. Information related to this single audit, including the auditors’ report on the internal control and compliance with applicable laws, regulations, contracts and grants along with findings and questioned costs, are included in the single audit section of this report. 1) REPORTING ENTITY AND ITS SERVICES: The Haledon Public School District is an independent reporting entity within the criteria adopted by the SASB as established by GASB Statement No. 14. All funds and account groups of the District are included in this report. Borough of Haledon Board of Education and all its schools constitute the District’s reporting entity. The District provides a full range of educational services appropriate to grade levels Pre-School, Pre-School Handicap and K through 8. These include regular classes for PreK-8 and special education classes for Preschool Handicapped and PreK-8. The District had at the October 2017 ASSA count of 1,027 students, which is 9 students less than the previous year’s average daily enrollment. The following details the changes in the student enrollment of the District over the last ten years.

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Average Daily Enrollment

Fiscal Year Student Enrollment PPeerrcceenntt CChhaannggee

2017-2018 1027 ((00..8877%%))

2016-2017 1036 ((11..4433%%))

2015-2016 1051 22..0099%%

2014-2015 1029 11..0088%%

2013-2014 1018 11..3399%%

2012-2013 1004 ((33..2288%%))

2011-2012 1038 ((11..1144%%))

2010-2011 1050 ..22%%

2009-2010 1052 ..55%%

2008 - 09 1046 ((33..8888%%))

2) ECONOMIC CONDITION AND OUTLOOK: The Borough of Haledon is experiencing limited economic development and growth. It is not expected that there will be any strong economic growth or expansion in the region in the near future. Additional state aid funding could assist the district in future years. 3) MAJOR INITIATIVES Major Initiatives Implemented in the 2017-18 School Year: Construction – The Board of Education instituted phase 2 of its window replacement plan, installed security film on its first floor windows, renovated bathrooms in the nurse’s and Faculty rooms, replaced a unit vent in the Nurse’s Office, upgraded the district playground, installed an exterior water fountain, replaced floor tile in several rooms and replaced stairwell and fire doors throughout the district. Solar panels were also installed during the school year, decreasing both the district’s carbon footprint and energy bills. Technology – The 2017-18 school year saw additional chromebooks purchased to bring the district to its 1:1 goal (having a chromebook or technological device for every student in its building). The phone system was also upgraded. 2018-19 The upcoming school year continues the positive changes the school district has had for the past several years. The district will continue to reinvest in its facilities, completing the school’s window replacement. Technology upgrades will include adding wireless access points for PARCC testing, upgrading the district’s Fireweall and installing Promethean Boards in several classrooms as well as purchasing a tricaster and camera for morning announcements. 4) INTERNAL ACCOUNTING CONTROLS: Management of the District is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the District are protected from loss, theft or misuse and to ensure that adequate accounting data are compiled to allow for the preparation of financial statements in conformity with generally accepted accounting principles (GAAP). The internal control structure is designed to provide reasonable, but not

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absolute, assurance that these objectives are met. The concept of reasonable assurance recognized that: (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management. As a recipient of federal and state financial assistance, the District also is responsible for ensuring that an adequate internal control structure is in place to ensure compliance with applicable laws and regulations related to those programs. This internal control structure is also subject to periodic evaluation by the District management. As part of the District’s single audit described earlier, tests are made to determine the adequacy of the internal control structure, including that portion related to federal and state financial assistance programs, as well as to determine that the District has complied with applicable laws and regulations. 5) BUDGETARY CONTROLS: In addition to internal accounting controls, the District maintains budgetary controls. The objective of these budgetary controls is to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the voters of the municipality. Annual appropriated budgets are adopted for the general fund, the special revenue fund, and the debt service fund. Project-length budgets are approved for the capital improvements accounted for in the capital projects fund. The final budget amount as amended for the fiscal year is reflected in the financial section. An encumbrance accounting system is used to record outstanding purchase commitments on a line item basis. Open encumbrances at year-end are either canceled or are included as reappropriations of fund balance in the subsequent year. Those amounts to be re-appropriated are reported as reservations of fund balance at June 30, 2018. 6) CASH MANAGEMENT: The investment policy of the District is guided in large part by state statute as detailed in “Notes to the Financial Statements,” Note 2. The District has adopted a cash management plan which requires it to deposit public funds in public depositories protected from loss under the provisions of the Governmental Unit Deposit Protection Act (“GUDPA”). GUDPA was enacted in 1970 to protect Governmental Units from a loss of funds on deposit with a failed banking institution in New Jersey. The law requires governmental units to deposit public funds only in public depositories located in New Jersey, where the funds are secured in accordance with the Act. 7) RISK MANAGEMENT: The Board carries various forms of insurance, including but not limited to general liability, automobile liability and comprehensive/collision, hazard and theft insurance on property and contents, and fidelity bonds. 8) OTHER INFORMATION: State statutes require an annual audit by independent certified public accountants or registered municipal accountants. The accounting firm of Ferraioli, Wielkotz, Cerullo & Cuva, P.A., was selected by the Board’s audit committee. In addition to meeting the requirements set forth in state statutes, the audit also was designed to meet the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and the New Jersey OMB 15-08, Single Audit Policy for Recipients of Federal Grants, State Grants and State Aid. The auditor’s report on the basic financial statements and specific required supplemental information is included in the financial section

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of this report. The auditor’s reports related specifically to the single audit are included in the single audit section of this report. 9) ACKNOWLEDGEMENTS: We would like to express our appreciation to the members of the Borough of Haledon School Board for their concern in providing fiscal accountability to the citizens and taxpayers of the school district and thereby contributing their full support to the development and maintenance of our financial operation. The preparation of this report could not have been accomplished without the efficient and dedicated services of our financial and accounting staff. Respectfully submitted,

Miguel Hernandez John A. Serapiglia, Jr. Miguel Hernandez, Ph.D. John A. Serapiglia, Jr. Superintendent Business Administrator/Board Secretary

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BOROUGH OF HALEDON BOARD OF EDUCATION HALEDON, NEW JERSEY

ROSTER OF OFFICIALS JUNE 30, 2018

BOARD OF EDUCATION TERM EXPIRES John Kaslander, President

2019

Joyce Smith, Vice President

2019

Kathleen Gonzales

2019

Ellen P. Fischer

2020

Dr. Daniel Jean

2018

George Guzman

2020

Catherine Perez

2020

Anyelis Diaz

2018

Jeffrey Fischer

2018

OTHER OFFICIALS

Miguel Hernandez, Ph. D., Superintendent

John Serapiglia, Board Secretary/Business Administrator

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BOROUGH OF HALEDON BOARD OF EDUCATION

CONSULTANTS AND ADVISORS

ARCHITECT

DiCara Rubino Architects 30 Galesi Drive, West Wing

Wayne, NJ 07470

AUDIT FIRM

Ferraioli, Wielkotz, Cerullo & Cuva, P.A. 401 Wanaque Avenue

Pompton Lakes, NJ 07442

ATTORNEY

Fogarty & Hara Counselors at Law

16-00 Route 208 South Fair Lawn, NJ 07410

OFFICIAL DEPOSITORY

TD Bank North Belmont Avenue

Haledon, NJ 07508

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FINANCIAL SECTION

Ferraioli, Wielkotz, Cerullo & Cuva, P.A.Charles J. Ferraioli, Jr., MBA, CPA, RMA Certified Public Accountants Newton Office Steven D. Wielkotz, CPA, RMA 401 Wanaque Avenue 100B Main Street James J. Cerullo, CPA, RMA Pompton Lakes, New Jersey 07442 Newton, NJ 07860Paul J. Cuva, CPA, RMA 973-835-7900 973-579-3212Thomas M. Ferry, CPA, RMA Fax 973-835-6631 Fax 973-579-7128

INDEPENDENT AUDITOR'S REPORT

Honorable President andMembers of the Board of EducationBorough of Haledon School DistrictCounty of Passaic, New Jersey

Report on the Financial Statements

We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the Board ofEducation of the Borough of Haledon School District, in the County of Passaic, State of New Jersey,as of and for the year ended June 30, 2018, and the related notes to the financial statements, whichcollectively comprise the District’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements inaccordance with accounting principles generally accepted in the United States of America; thisincludes the design, implementation, and maintenance of internal control relevant to the preparationand fair presentation of financial statements that are free from material misstatements, whether dueto fraud or error.

Auditor’s Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. Weconducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica, the audit requirements prescribed by the Office of School Finance, Department ofEducation, State of New Jersey, and the standards applicable to financial audits contained inGovernment Auditing Standards, issued by the Comptroller General of the United States. Thosestandards require that we plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free of material misstatement.

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Honorable President andMembers of the Board of EducationPage 2.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the financial statements. The procedures selected depend on the auditor’s judgment, including theassessment of the risks of material misstatement of the financial statements, whether due to fraud orerror. In making those risk assessments, the auditor considers internal control relevant to theentity’s preparation and fair presentation of the financial statements in order to design auditprocedures that are appropriate in the circumstances, but not for the purpose of expressing anopinion on the effectiveness of the entity’s internal control. Accordingly, we express no suchopinion. An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of significant accounting estimates made by management, as well as evaluating theoverall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinions.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, therespective financial position of the governmental activities, business-type activities, each majorfund, and the aggregate remaining fund information of the Borough of Haledon Board of Education,in the County of Passaic, State of New Jersey, as of June 30, 2018, and the respective changes infinancial position and, where applicable, cash flows thereof for the year then ended in accordancewith accounting principles generally accepted in the United States of America.

Emphasis of Matter

Change in Accounting Principle

As discussed in Note 1 to the basic financial statements, in 2018, the Board adopted GovernmentalAccounting Standards Board Statement No. 75, Accounting and Financial Reporting for PostEmployment Benefits Other Than Pensions (an Amendment of GASB Statement No. 45). Ouropinions are not modified with respect to this matter.

Other Matters

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that theManagement’s Discussion and Analysis and Budgetary Comparison Information, and SchedulesRelated to Accounting and Reporting for Pensions identified in the table of contents be presented tosupplement the basic financial statements. Such information, although not a part of the basicfinancial statements, is required by the Governmental Accounting Standards Board who considers itto be an essential part of the financial reporting for placing the basic financial statements in anappropriate operational, economic, or historical context. We have applied certain limited procedures

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to the required supplementary information in accordance with auditing standards generally acceptedin the United States of America, which consisted of inquiries of management about the methods ofpreparing the information and comparing the information for consistency with management’sresponses to our inquiries, the basic financial statements, and other knowledge we obtained duringour audit of the basic financial statements. We do not express an opinion or provide any assuranceon the information because the limited procedures do not provide us with sufficient evidence toexpress an opinion or provide any assurance.

Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements thatcollectively comprise the Borough of Haledon Board of Education’s basic financial statements. Theintroductory section, combining and individual nonmajor fund financial statements and schedule ofexpenditures of federal awards, as required by Title 2 U.S. Code of Federal Regulations Part 200,Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards(Uniform Guidance) and the statistical section are presented for purposes of additional analysis andare not a required part of the basic financial statements.

The combining and individual nonmajor fund financial statements and the schedule of expendituresof federal awards, as required by Title 2 U.S. Code of Federal Regulations Part 200, UniformAdministrative Requirements, Cost Principles, and Audit Requirements for Federal Awards(Uniform Guidance) and the schedule of expenditures of state financial assistance as required by NJOMB 15-08 are the responsibility of management and were derived from and relates directly to theunderlying accounting and other records used to prepare the basic financial statements. Suchinformation has been subjected to the auditing procedures applied in the audit of the basic financialstatements and certain additional procedures, including comparing and reconciling such informationdirectly to the underlying accounting and other records used to prepare the basic financial statementsor to the basic financial statements themselves, and other additional procedures in accordance withauditing standards generally accepted in the United States of America. In our opinion, thecombining and individual nonmajor fund financial statements, and schedule of expenditures offederal awards, as required by Title 2 U.S. Code of Federal Regulations Part 200, UniformAdministrative Requirements, Cost Principles, and Audit Requirements for Federal Awards(Uniform Guidance), and the schedule of expenditures of state financial assistance as required by NJOMB 15-08 are fairly stated, in all material respects, in relation to the basic financial statements as awhole.

The introductory section and statistical data section has not been subject to the auditing proceduresapplied in the audit of the basic financial statements, and accordingly, we do not express an opinionor provide any assurance on it.

-10-


Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated January22, 2019 on our consideration of the Borough of Haledon Board of Education’s internal control overfinancial reporting and on our tests of its compliance with certain provisions of laws, regulations,contracts, and grant agreements and other matters. The purpose of that report is to describe thescope of our testing of internal control over financial reporting and compliance and the results ofthat testing, and not to provide an opinion on internal control over financial reporting or oncompliance. That report is an integral part of an audit performed in accordance with Government

Auditing Standards in considering the Borough of Haledon Board of Education’s internal controlover financial reporting and compliance.

James Cerullo, C.P.A.Licensed Public School AccountantNo. 881

FERRAIOLI, WIELKOTZ, CERULLO & CUVA, P.A.Certified Public AccountantsPompton Lakes, New Jersey

January 22, 2019

Ferraioli, Wielkotz, Cerullo & Cuva,P.A.

James Cerullo

-11-

REQUIRED SUPPLEMENTARY

INFORMATION - PART I

BOROUGH OF HALEDON BOARD OF EDUCATIONHALEDON, NJ

MANAGEMENT’S DISCUSSION AND ANALYSISFOR THE FISCAL YEAR ENDED JUNE 30, 2018

The discussion and analysis of the Borough of Haledon Board of Education’s financial performanceprovides an overall review of the School District’s financial activities for the fiscal year endedJune 30, 2018. The intent of this discussion and analysis is to look at the District’s financialperformance as a whole and should not be interpreted as a replacement for the audit which consistsof the financial statements and other supplemental information that presents all the District’srevenues and expenditures by program for the General Fund, Special Revenue Fund, Capital ProjectsFund, Debt Service and Enterprise Fund.

FINANCIAL HIGHLIGHTS

• In total, net position decreased $714,881.35. Net position of governmental activitiesdecreased $624,708.23 while net position of business-type activity decreased by $90,173.12. These variances are primarily the result of an increase in employee benefits and other budgetexpenditures in 2017-18 and increased operating expenses of the business-type activities.

• General revenues accounted for $20,168,470.41 in revenue or 89.32 percent of all districtrevenues. Program specific revenues in the form of charges for services and sales, grants andcontributions accounted for $2,399,163.67 or10.68 percent of total revenues of$22,580,384.08.

• The School District had $22,310,226.61 in expenses related to governmental activities; only$1,527,807.37 of these expenses were offset by program specific charges for services, grantsor contributions. General revenues (primarily grants, entitlements and property taxes) of$20,170,461.01were adequate to provide for these programs.

USING THIS ANNUAL REPORT

This annual report consists of a series of financial statements and notes to those statements. Thestatements are organized so the reader can understand the District as a whole (district-widestatements), and then proceed to provide an increasingly detailed look at specified financialactivities.

District-Wide Financial Statements

The statement of net position and statement of activities reports information about the District as awhole and about its activities in a manner that helps answer the question, “Is the District better orworse off as a result of the year’s activities?” These statements include all assets and liabilities ofthe District using the accrual basis of accounting, similar to the accounting used by private sectorcorporations. All of the current year’s revenues and expenses are taken into consideration regardlessof when cash is received or paid.

Both of the district-wide financial statements distinguish functions of the Borough of Haledon Boardof Education that are principally supported by taxes and intergovernmental revenues (governmentalactivities) from other functions that are intended to recover all or a significant portion of their coststhrough user fees and charges (business-type activities).

-12-



(CONTINUED)

USING THIS ANNUAL REPORT, (continued)

In the Statement of Net Position and the Statement of Activities, the District is divided into twodistinct kinds of activities:

C Governmental Activities – All of the school district’s programs and services are reportedhere including instruction, support services, operation and maintenance of plant facilities,pupil transportation and extracurricular activities.

C Business-type Activities – These services are provided on a charge for goods and servicesbasis to recover all the expenses of the goods or services provided. The Food Serviceprogram and after care summer camp program are reported as business activities.

The two statements report the District’s net position and changes in them. The change in netposition can be utilized by a reader to assist in determining whether the District’s financial healthis improving or deteriorating. However, the reader should also consider non-financial factors suchas property tax base, current New Jersey laws restricting revenue growth, student enrollment growth,facility conditions, required educational programs and other factors in determining the District’soverall financial health.

Fund Financial Statements

A fund is a grouping of related accounts that is used to maintain control over resources that havebeen segregated for specific activities or objectives. The Borough of Haledon Board of Education,like other state and local governments, uses fund accounting to ensure and demonstrate compliancewith finance-related legal requirements. All of the district’s funds can be divided into threecategories: Governmental Funds, Proprietary Funds and Fiduciary Funds.

Governmental Funds

Governmental funds are used to account for essentially the same functions reported as governmentalactivities in the district-wide financial statements. However, unlike the district-wide financialstatements, governmental fund financial statements focus on near-term inflows and outflows ofspendable resources, as well as on balances of spendable resources available at the end of the fiscalyear. These funds are reported using an accounting method called modified accrual accounting,which measures cash and all other financial assets that can be readily converted to cash.

Because the focus of governmental funds is narrower than that of the district-wide financialstatements, it is useful to compare the information presented for governmental funds with similarinformation presented for governmental activities in the district-wide financial statements. By doingso, readers may better understand the long-term impact of the District’s near-term financingdecisions. Both the governmental fund balance sheet and the governmental fund statement ofrevenues, expenditures, and changes in fund balances provide a reconciliation to facilitate thiscomparison between governmental funds and governmental activities (reported in the Statement ofNet Position and the Statement of Activities).

-13-



(CONTINUED)

USING THIS ANNUAL REPORT, (continued)

The Borough of Haledon Board of Education maintains four individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmentalstatement of revenues, expenditures and changes in fund balances for the general, special revenue,capital projects and debt service funds, which are considered to be major funds.

The Borough of Haledon Board of Education adopts annual appropriated budgets for itsgovernmental funds. A budgetary comparison statement has been provided for the general fund,special revenue fund and debt service to demonstrate compliance with their budgets.

Proprietary Funds

Proprietary funds use the accrual basis of accounting, the same as on the district-wide statements,therefore the statements will essentially match the business-type activities portion of the district-widestatements. The Borough of Haledon Board of Education uses proprietary funds to account for itsfood service program, summer camp program and after care program.

Fiduciary Funds

Fiduciary funds are used to account for resources held for the benefit of parties outside the District. These activities are excluded from the District’s other financial statements because the assets cannotbe utilized by the District to finance its operations. Notes to the Financial Statements

The notes provide additional information that is essential to a full understanding of the data providedin the district-wide and fund financial statements.

Other Information

In addition to the basic financial statements and accompanying notes, this report also presents certainrequired supplementary information concerning budgetary information for the District’s majorfunds.

Our auditor has provided assurance in his independent auditor’s report, located immediatelypreceding this Management’s Discussion and Analysis, that the Basic Financial Statements are fairlystated. Varying degrees of assurance are being provided by the auditor regarding the RequiredSupplemental Information and the Supplemental Information identified above. A user of this reportshould read the independent auditor’s report carefully to ascertain the level of assurance beingprovided for each of the other parts in the Financial Section.

-14-



(CONTINUED)

DISTRICT-WIDE FINANCIAL ANALYSIS

The Statement of Net Position provides the perspective of the District as a whole. Net position may,over time, serve as a useful indicator of a government’s financial position.

The District’s financial position is the product of several financial transactions including the netresults of activities, the acquisition and payment of debt, the acquisition and disposal of capital assetsand the depreciation of capital assets.

The School District’s net position’s were $8,857,432.55 at June 30, 2018 and $9,572,313.90 at June30, 2017. Restricted items of net position are reported separately to show legal constraints that limitthe School District’s ability to use those items of net position for day-to-day operations. Our analysisbelow focuses on the net position for 2018 compared to 2017 (Table 1) and change in net position(Table 2) of the School District.

Table 1

Net PositionJune 30,

Governmental Activities Business-Type Activities Total

2018 2017 2018 2017 2018 2017

Assets

Current and Other Assets 1,503,404.00 2,867,732.71 266,852.72 384,616.13 1,770,256.72 3,252,348.84

Capital Assets 11,059,843.46 10,857,094.90 232,430.91 202,022.37 11,292,274.37 11,059,117.27

Total Assets 12,563,247.46 13,724,827.61 499,283.63 586,638.50 13,062,531.09 14,311,466.11

Deferred Outflows 1,125,718.00 1,567,348.00 1,125,718.00 1,567,348.00

Liabilities

Current Liabilities 675,823.31 1,347,575.66 5,294.95 2,476.70 681,118.26 1,350,052.36

Noncurrent Liabilities 3,847,162.28 4,943,805.85 3,847,162.28 4,943,805.85

Total Liabilities 4,522,985.59 6,291,381.51 5,294.95 2,476.70 4,528,280.54 6,293,858.21

Deferred Inflows 802,536.00 12,642.00 802,536.00 12,642.00

Net Position

Invested in Capital Assets 11,059,843.46 10,857,094.90 232,430.91 202,022.37 11,292,274.37 11,059,117.27

Restricted 981,536.18 1,621,696.91 981,536.18 1,621,696.91

Unrestricted (3,677,935.77) (3,490,639.71 261,557.77 382,139.43 (3,416,378.00) (3,108,500.28)

Total Net Position 8,363,443.87 8,988,152.10 493,988.68 584,161.80 8,857,432.55 9,572,313.90

-15-



(CONTINUED)

DISTRICT-WIDE FINANCIAL ANALYSIS, (continued)

Table 2 below shows the changes in net position for fiscal year 2018 compared to 2017.

Table 2Changes in Net Position

Year Ended June 30,


2018 2017 2018 2017 2018 2017

Revenues

Program Revenues:

Charges for Services and

Sales 326,569.09 309,758.00 326,569.09 309,758.00

Operating Grants and

Contributions 1,515,057.37 1,253,968.22 557,537.21 545,784.07 2,072,594.58 1,799,752.29

General Revenues:

Taxes:

Property taxes, levied

For general purposes 6,456,600.00 6,330,000.00 6,456,600.00 6,330,000.00

Federal and State Aid not

Restricted 13,586,386.86 12,179,372.74 13,586,386.86 12,179,372.74

Other Restricted 3,808.50 41,197.00 3,808.50 41,197.00

Investment Earnings 827.94 429.01 72.54 135.29 900.48 564.30

Cancelled Accounts Receivable (2,063.14) (2,063.14) 0.00

Miscellaneous Income 122,837.71 181,736.61 122,837.71 181,736.61

Total Revenues and Transfers 21,685,518.38 19,986,703.58 882,115.70 855,677.36 22,567,634.08 20,842,380.94

-16-



(CONTINUED)



2018 2017 2018 2017 2018 2017

Functions/Program Expenses

Instruction:

Regular 7,372,997.05 6,879,619.18 7,372,997.05 6,879,619.18

Special 2,039,184.91 2,262,365.01 2,039,184.91 2,262,365.01

Other Special

Instruction 736,154.66 771,849.72 736,154.66 771,849.72

Other Instruction 125,407.36 111,645.11 125,407.36 111,645.11

Support Services:

Tuition 248,568.56 184,221.47 248,568.56 184,221.47

Student & Instruction

Related Services 2,059,505.70 2,025,620.67 2,059,505.70 2,025,620.67

School Administrative

Services 677,804.63 664,065.92 677,804.63 664,065.92

General Administrative

Services 351,017.96 373,510.51 351,017.96 373,510.51

Central Services and

Admin.Info.Tech. 502,003.99 484,349.14 502,003.99 484,349.14

Plant Operations and

Maintenance 925,720.73 977,931.12 925,720.73 977,931.12

Pupil Transportation 345,177.69 257,455.60 345,177.69 257,455.60

Unallocated Benefits 6,351,101.88 5,232,080.22 6,351,101.88 5,232,080.22

Capital Outlay 5,453.00 5,453.00 5,453.00 5,453.00

Unallocated depreciation 452,612.49 419,132.11 452,612.49 419,132.11

Charter Schools 117,516.00 46,496.00 117,516.00 46,496.00

Food Service 667,521.57 643,636.72 667,521.57 643,636.72

After Care Program 304,767.25 267,986.59 304,767.25 267,986.59

Total Expenses and Transfers 22,310,226.61 20,695,794.78 972,288.82 911,623.31 23,282,515.43 21,607,418.09

Increase or (Decrease) in

Net Position (624,708.23) (709,091.20) (90,173.12) (55,945.95) (714,881.35) (765,037.15)

-17-



(CONTINUED)


Governmental and Business- Activities

As reported in the Statement of Activities the cost of all of our governmental and business-typeactivities this year was $23,282,515.43. However, the amount that our taxpayers ultimately financedfor these activities through School District taxes was only $6,456,600.00 because some of the costwas paid by those who benefitted from the programs $326,569.09, by other governments andorganizations who subsidized certain programs 13,712,470.41.

Revenues for the District’s business-type activities (food service program, summer camp programand after care program) were comprised of charges for services and federal and state subsidyreimbursements. Significant financial results include the following:

T Food service expenses exceeded revenues by $84,585.31.

T Charges for services provided totaled $25,399.05 represents amounts paid by consumers fordaily food services.

T Federal and state reimbursement for meals served, including payments for free and reducedpriced lunches, and donated commodities was $557,537.21.

MAJOR GOVERNMENTAL FUNDS BUDGETING AND OPERATING HIGHLIGHTS

The School District’s budgets are prepared according to New Jersey law, and are based onaccounting for certain transactions on a basis of cash receipts, disbursements and encumbrances. The most significant budgeted funds are the general fund and the special revenue fund.

During the fiscal year ended June 30, 2018, the School District amended the budgets of these majorgovernmental funds several times. Revisions in the budget were made to recognize revenues thatwere not anticipated and/or to prevent over-expenditures in specific line item accounts. Several ofthese revisions bear notation:

C TPAF, which is the state’s contribution to the pension fund, is neither a revenue item nor anexpenditures item to the district but is required to be reflected in the financial statements.

C The special revenue fund was increased by $436,838.00 for increase in federal and state grantawards.

-18-



(CONTINUED)

MAJOR GOVERNMENTAL FUNDS BUDGETING AND OPERATING HIGHLIGHTS,(continued)

General Fund

The general fund actual revenue was $16,212,767.01. That amount is $2,740,844.01 above the finalamended budget of $13,471,923.00. The variance between the actual revenues and final budget wasthe result of non-budgeted on-behalf payments of $2,357,791.83 for TPAF social securityreimbursements and on-behalf pension payments and a $4,399.15 excess in miscellaneousanticipated revenues and $378,653.03 excess in other federal and state aids.

The actual expenditures of the general fund were $16,879,228.37 including transfers which is$2,173,859.69 above the final amended budget of 14,705,368.68. The variance between the actualexpenditures and final budget was due to non-budget on-behalf TPAF social security and pensionpayments of $2,357,791.83 and $183,932.14 of unexpended budgeted funds.

Special Revenue Fund

The special revenue fund actual revenue was $1,515,057.37. That amount is above the originalbudget estimate of $1,272,565.00 and below the final amended budget of $1,709,403.00. The$436,838.00 variance between the original and final budget was due to additional federal and stategrant monies awarded to the District after the original budget was approved. The $194,345.63variance between the final amended budget and the June 30, 2018 actual results was due to thedeferral of Federal and State grants received in the current fiscal year to be spent in the next fiscalyear.

The actual expenditures of the special revenue fund were $1,515,057.37, which is above the originalbudget of $1,272,565.00 and below the final amended budget of $1,709,403.00. The $436,838.00variance between the original and final budget was due to additional expenditures related to theadditional grants awarded to the District after the original budget was approved. The $184,345.63variance between the final amended budget and the June 30, 2018 actual results was due to theanticipation of fully expending federal and state grant programs. Expenditures will be incurred inthe next fiscal year.

-19-



(CONTINUED)

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets

At the end of fiscal year 2018 the School District had $18,189,716.28 invested in sites, buildings andequipment. Of this amount, $6,897,441.91 in depreciation has been taken over the years. We currently havea net book value of $11,292,274.37. Total additions for the year were $844,636.58, the majority of whichwas for improvements to the District’s facilities and various equipment. Table 3 shows fiscal year 2018balances compared to 2017.

Table 3Capital Assets at June 30,

(Net of Depreciation)

Governmental Activities Business Activities Total

2018 2017 2018 2017 2018 2017

Land 1,122,000.00 1,122,000.00 1,122,000.00 1,122,000.00

Land Improvements 431,550.31 418,355.61 431,550.31 418,355.61

Buildings and Improvements 8,648,269.13 8,519,441.74 8,648,269.13 8,519,441.74

Furniture, Equipment and Vehicles 858,024.02 797,297.55 232,430.91 202,022.37 1,090,454.93 999,319.92

11,059,843.46 10,857,094.90 232,430.91 202,022.37 11,292,274.37 11,059,117.27

Debt Administration

At June 30, 2018, the district had $3,847,162.28 of long-term debt. Of this amount, $111,082.28 is forcompensated absences, and $3,736,080.00 is for net pension liability - PERS.

-20-



(CONTINUED)

ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS

The 2018-2019 school budget represents the fifth time that the residents in Haledon did not have anopportunity to vote on the Haledon School Budget. Changes in election law allowed for approval of schoolbudgets without an election (if they fell within tax cap) provided that the municipality, the school districtor the electorate voted for such a change. For the 2013-2014 school year, the Borough of Haledon voted todo away with the vote for the elementary school budget election. The budget put together for 2018-2019was within CAP, so there was also no election.

REQUESTS FOR INFORMATION

This financial report is designed to provide a general overview of the Borough of Haledon Board ofEducation’s finances for all those with an interest in the government’s finances. Questions concerning anyof the information provided in this report or requests for additional information should be addressed to:

John A. Serapiglia, Jr.,School Business AdministratorBorough of Haledon Board of Education70 Church StreetHaledon, New Jersey 07508

-21-

BASIC FINANCIAL STATEMENTS

DISTRICT-WIDE FINANCIAL STATEMENTS

Exhibit A-1

BOROUGH OF HALEDON SCHOOL DISTRICT

Statement of Net Position

June 30, 2018

Governmental Business-type

Activities Activities Total

ASSETS

Cash and Cash Equivalents 285,784.67 285,784.67

Receivables, net 453,757.42 44,441.93 498,199.35

Internal Balances 68,110.40 (68,110.40) -

Inventory 4,736.52 4,736.52

Restricted Assets:


Capital Assets :

Land and Construction in Progress 1,122,000.00 1,122,000.00

Other Capital Assets, net 9,937,843.46 232,430.91 10,170,274.37

Total Assets 12,563,247.46 499,283.63 13,062,531.09

DEFERRED OUTFLOWS

Deferred Outflows of Resources Related to PERS - Pension 1,125,718.00 1,125,718.00

LIABILITIES

Cash Deficit 325,141.14 325,141.14

Accounts Payable and Accrued Liabilities 312,346.19 5,218.82 317,565.01

Interfunds Payable - Fiduciary Fund 2,496.84 2,496.84

Unearned Revenue 35,839.14 76.13 35,915.27

Noncurrent Liabilities:

Due beyond one year 3,847,162.28 3,847,162.28

Total Liabilities 4,522,985.59 5,294.95 4,528,280.54

DEFERRED INFLOWS

Deferred Inflows of Resources Related to PERS - Pension 802,536.00 802,536.00

NET POSITION

Invested in Capital Assets 11,059,843.46 232,430.91 11,292,274.37

Restricted for:

Capital Projects 490,885.24 490,885.24

Other Purposes 490,650.94 490,650.94

Unrestricted (Deficit) (3,677,935.77) 261,557.77 (3,416,378.00)

Total Net Position 8,363,443.87 493,988.68 8,857,432.55

See Accompanying Notes to Financial Statements.

-22-

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-23-

FUND FINANCIAL STATEMENTS

Exhibit B-1


Balance Sheet

Governmental Funds

June 30, 2018

Special Total

General Revenue Governmental

Fund Fund Funds

ASSETS

Interfund Receivables 299,177.18 299,177.18

Receivables from Other Governments 69,101.30 384,630.23 453,731.53

Restricted Cash and Cash Equivalents 981,536.18 981,536.18

Total Assets 1,349,814.66 384,630.23 1,734,444.89

LIABILITIES AND FUND BALANCES

Liabilities:

Cash Deficit 325,141.14 325,141.14

Accounts Payable 42,939.99 117,750.20 160,690.19

Interfund Payables 2,496.84 231,040.89 233,537.73

Unearned Revenue 35,839.14 35,839.14

Total Liabilities 370,577.97 384,630.23 755,208.20

Fund Balances:

Restricted for:

Capital Reserve 490,885.24 490,885.24

Emergency Reserve 225,036.99 225,036.99

Maintenance Reserve 265,613.95 265,613.95

Assigned to:

Other Purposes 15,718.78 15,718.78

Designated by Board of Education for

Subsequent Year's Expenditures 356,550.00 356,550.00

Unassigned:

General Fund (374,568.27) (374,568.27)

Total Fund Balances 979,236.69 979,236.69

Total Liabilities and Fund Balances 1,349,814.66 384,630.23

Amounts reported for governmental activities in the statement of

net assets (A-1) are different because:

Capital assets used in governmental activities are not financial

resources and therefore are not reported in the funds. The cost

of the assets is $17,720,397.85 and the accumulated depreciation

is $6,660,554.39. 11,059,843.46

Accounts Payable for subsequent Pension payment is not a

payable in the funds (151,656.00)

Deferred Outflows and Inflows of resources are applicable to future

periods and therefore are not reported in the funds.

Deferred Outflows of Resources Related to PERS

Pension Liability 1,125,718.00

Deferred Inflows of Resources Related to PERS

Pension Liability (802,536.00)

Long-term liabilities are not due and payable in the

current period and therefore are not reported as

liabilities in the funds. (3,847,162.28)

Net position of governmental activities 8,363,443.87


-24-

Exhibit B-2


Statement of Revenues, Expenditures, and Changes in Fund Balances

Governmental Funds

For the Year Ended June 30, 2018

Special Total

General Revenue Governmental

Fund Fund Funds

REVENUES

Local Sources:

Local Tax Levy 6,456,600.00 6,456,600.00

Tuition 3,808.50 3,808.50

Interest Earned on Emergency Reserve Funds 19.59 19.59

Interest Earned on Maintenance Reserve Funds 46.00 46.00

Interest Earned on Capital Reserve Funds 179.00 179.00

Interest Earned on Investments 583.35 583.35

Miscellaneous 122,837.71 122,837.71

Total - Local Sources 6,584,074.15 6,584,074.15

State Sources 9,580,089.58 589,326.37 10,169,415.95

Federal Sources 22,149.28 938,481.00 960,630.28

Total Revenues 16,186,313.01 1,527,807.37 17,714,120.38

EXPENDITURES

Current:

Regular Instruction 4,460,935.84 1,210,914.29 5,671,850.13

Special Education Instruction 1,520,505.93 1,520,505.93

Other Special Instruction 537,660.72 537,660.72

Other Instruction 96,777.59 96,777.59

Support Services and Undistributed Costs:

Tuition 248,568.56 248,568.56

Student & Instruction Related Services 1,320,223.62 316,893.08 1,637,116.70

School Administrative Services 494,740.79 494,740.79

General Administrative Services 327,529.81 327,529.81

Central & Admin. Inf. Technology 482,573.64 482,573.64

Plant Operations and Maintenance 801,090.70 801,090.70

Pupil Transportation 323,439.44 323,439.44

Unallocated Benefits 5,345,666.51 5,345,666.51

Capital Outlay 801,999.22 801,999.22

Transfer of Funds to Charter School 117,516.00 117,516.00

Total Expenditures 16,879,228.37 1,527,807.37 18,407,035.74

Excess (Deficiency) of Revenues

Over Expenditures (692,915.36) (692,915.36)

Net Change in Fund Balances (692,915.36) (692,915.36)

Fund Balance—July 1 1,672,152.05 1,672,152.05

Fund Balance—June 30 979,236.69 979,236.69


-25-

Exhibit B-3


Reconciliation of the Statement of Revenues, Expenditures,

and Changes in Fund Balances of Governmental Funds

to the Statement of Activities


Total net change in fund balances - governmental funds (from B-2) (692,915.36)

Amounts reported for governmental activities in the statement

of activities (A-2) are different because:

Capital outlays are reported in governmental funds as expenditures. However, in the statement of

activities, the cost of those assets is allocated over their estimated useful lives as depreciation expense.

This is the amount by which capital outlays exceeded depreciation in the period.

Depreciation Expense (593,797.66)

Depreciable Capital Outlays 796,546.22 202,748.56

In the statement of activities, certain operating expenses, e.g., compensated absences (vacations) are

measured by the amounts earned during the year. In the governmental funds, however, expenditures

for these items are reported in the amount of financial resources used (paid). When the earned amount

exceeds the paid amount, the difference is reduction in the reconciliation (-); when the paid amount

exceeds the earned amount the difference is an addition to the reconciliation (+).

Increase/(Decrease) in Compensated Absences Payable 6,793.57

District pension contributions are reported as expenditures in the governmental funds when made.

However, per GASB No. 68 they are reported as deferred outflows of resources in the Statement of

Net Position because the reported net pension liability is measured a year before the District's report

date. Pension expense, which is the change in the net pension liability adjusted for changes in deferred

outflows and inflows of resources related to pensions, is reported in the Statement of Activities.

District Pension Contributions 148,682.00

Less: Pension Expense (290,017.00)

(Increase)/Decrease in Pension Expense (141,335.00)

Per GASB No. 68 Non-employer contributing entities are required to record an increases in revenue and

expense for On-behalf TPAF pension payments paid by the State of New Jersy on the Statement of

Activities that are in excess of those amounts reported in the fund financial statements

Increase in On-behalf State Aid TPAF Pension 2,339,923.00

Increase in On-behalf TPAF Pension Expense (2,339,923.00)

Per GASB No. 75 Non-employer contributing entities are required to record an increases in revenue and

expense for On-behalf TPAF post retirement medical payments paid by the State of New Jersy on the

Statement of Activities that are in excess of those amounts reported in the fund financial statements

Increase in On-behalf State Aid TPAF Post Retirement Medical 1,644,225.00

Increase in On-behalf TPAF Post Retirement Medical (1,644,225.00)

Change in net position of governmental activities (624,708.23)


-26-

Exhibit B-4


Statement of Net Position

Proprietary Funds

June 30, 2018

Business-Type Activities -

Enterprise Fund

After Care / Total

Food Service Summer Camp Enterprise

Program Program Fund

ASSETS

Current Assets:

Cash and Cash Equivalents 85,878.41 199,906.26 285,784.67

Accounts Receivable:

State 621.92 621.92

Federal 38,302.14 38,302.14

Other 5,517.87 5,517.87

Inventories 4,736.52 4,736.52

Total Current Assets 129,538.99 205,424.13 334,963.12

Noncurrent Assets:

Capital Assets:

Equipment 469,318.43 469,318.43

Less Accumulated Depreciation (236,887.52) (236,887.52)

Total Capital Assets (Net of Accumulated

Depreciation) 232,430.91 232,430.91

Total Assets 361,969.90 205,424.13 567,394.03

LIABILITIES

Current Liabilities:

Prepaid Revenue 76.13 76.13

Interfunds Payable 68,110.40 68,110.40

Total Current Liabilities 72,737.77 667.58 73,405.35

Total Liabilities 72,737.77 667.58 73,405.35

NET POSITION

Invested in Capital Assets Net of

Related Debt 232,430.91 232,430.91

Unrestricted 56,801.22 204,756.55 261,557.77

Total Net Position 289,232.13 204,756.55 493,988.68


-27-

Exhibit B-5


Statement of Revenues, Expenses, and Changes in Fund Net Position

Proprietary Funds



Enterprise Fund

After Care / Total



Operating Revenues:

Charges for Services:

Daily Sales - Non-Reimbursable Programs 25,399.05 25,399.05

Miscellaneous - Program Fees 301,170.04 301,170.04

Total Operating Revenues 25,399.05 301,170.04 326,569.09

Operating Expenses:

Cost of sales-reimbursable programs 289,924.23 289,924.23

Cost of sales-non-reimbursable programs 56,844.00 56,844.00

Salaries 165,824.31 279,388.32 445,212.63

Supplies and Materials 53,482.82 3,974.42 57,457.24

Employee Benefits 32,883.06 14,567.04 47,450.10

Purchased Professional and Technical Services 11,852.00 100.16 11,952.16

Cleaning Repair & Maintenance 20,320.69 20,320.69

Utilities 4,853.89 4,853.89

Other Purchased Services 65.00 65.00

Miscellaneous Expense 13,789.75 5,532.31 19,322.06

Transportation 1,205.00 1,205.00

Depreciation 17,681.82 17,681.82

Total Operating Expenses 667,521.57 304,767.25 972,288.82

Operating Income (Loss) (642,122.52) (3,597.21) (645,719.73)

Nonoperating Revenues (Expenses):

State Sources:

State School Lunch Program 7,935.52 7,935.52

Federal Sources:

National School Lunch Program 362,954.84 362,954.84

School Breakfast Program 103,176.77 103,176.77

After School Snack Program 30,422.48 30,422.48

HHFKA Program 8,877.12 8,877.12

U.S.D.A. Commodities:

Food Distribution Program 44,170.48 44,170.48

Interest and Investment Revenue 72.54 72.54

Total Nonoperating Revenues (Expenses) 557,609.75 557,609.75

Income (Loss) Before Contributions & Transfers (84,512.77) (3,597.21) (88,109.98)

Cancellation of Prior Year Receivable (2,063.14) (2,063.14)

Change in Net Position (86,575.91) (3,597.21) (90,173.12)

Total Net Position—Beginning 375,808.04 208,353.76 584,161.80

Total Net Position—Ending 289,232.13 204,756.55 493,988.68


-28-

Exhibit B-6


Statement of Cash Flows

Proprietary Funds



Enterprise Fund

After Care / Total



CASH FLOWS FROM OPERATING ACTIVITIES

Receipts from Customers 25,475.18 298,753.13 324,228.31

Receipts from Interfunds (10,697.95) (10,697.95)

Payments to Employees (29,749.01) (279,388.32) (309,137.33)

Payments for Employee Benefits (2,403.56) (14,567.04) (16,970.60)

Payments to Suppliers (30.00) (3,306.84) (3,336.84)

Payments for Miscellaneous Expenses (5,696.80) (6,837.47) (12,534.27)

Payments to Food Service Management Company (514,500.17) (514,500.17)

Net Cash Provided by (Used for) Operating Activities (537,602.31) (5,346.54) (542,948.85)

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES

State Sources 8,806.53 8,806.53

Federal Sources 529,404.96 529,404.96

Net Cash Provided by (Used for) Non-Capital Financing Activities 538,211.49 538,211.49

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES

Purchases of Capital Assets (48,090.36) (48,090.36)

Net Cash Provided by (Used for) Capital and Related Financing Activities (48,090.36) (48,090.36)

CASH FLOWS FROM INVESTING ACTIVITIES

Interest and dividends 72.54 72.54

Net Cash Provided by (Used for) Investing Activities 72.54 72.54

Net Increase (Decrease) in Cash and Cash Equivalents (47,408.64) (5,346.54) (52,755.18)

Balances—Beginning of Year 133,287.05 205,252.80 338,539.85

Balances—End of Year 85,878.41 199,906.26 285,784.67

Reconciliation of Operating Income (Loss) to Net Cash Provided

(Used) by Operating Activities:


Adjustments to Reconcile Operating Income (Loss) to Net Cash Provided

(Used for) Operating Activities

Depreciation and Net Amortization 17,681.82 17,681.82

Food Distribution Program Donated Commodities 44,170.48 44,170.48

(Increase) Decrease in Accounts Receivable, Net 59.79 59.79

(Increase) Decrease in Inventories (1,826.79) (1,826.79)

Increase (Decrease) in Accounts Payable 4,551.24 667.58 5,218.82

Increase (Decrease) in Other Current Liabilities 39,943.46 (2,476.70) 37,466.76

Total Adjustments 104,520.21 (1,749.33) 102,770.88



-29-

Exhibit B-7


Statement of Fiduciary Net Position

Fiduciary Funds

June 30, 2018

Unemployment

Compensation Agency

Trust Fund Fund

ASSETS


Interfund Receivable 4,745.31 2,496.84

Total Assets 328,545.50 541,291.05

LIABILITIES

Interfund Payable 4,771.20

Payable to Student Groups 25,575.45

Payroll Deductions and Withholdings 510,944.40

Total Liabilities 541,291.05

NET POSITION

Held in Trust for Unemployment

Claims and Other Purposes 328,545.50


-30-

Exhibit B-8


Statement of Changes in Fiduciary Net Position

Fiduciary Funds


Unemployment

Compensation

Trust Fund

ADDITIONS

Contributions:

Plan Member 24,429.61

Total Contributions 24,429.61

Investment Earnings:

Interest 359.10

Net Investment Earnings 359.10

Total Additions 24,788.71

DEDUCTIONS

Quarterly Contribution Reports 7,101.48

Unemployment Claims 25,130.17

Total Deductions 32,231.65

Change in Net Position (7,442.94)

Net Position—Beginning of the Year 335,988.44

Net Position—End of the Year 328,545.50


-31-

NOTES TO THE FINANCIAL STATEMENTS

Borough of Haledon School DistrictNotes to the Basic Financial Statementsfor the fiscal year ended June 30, 2018

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The financial statements of the Board of Education of the Borough of Haledon School District have beenprepared in conformity with accounting principles generally accepted in the United States of America(GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is theaccepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant of the board’s accounting policies are described below.

A. Description of the School District and Reporting Entity:

The Board of Education (“Board”) of the Borough of Haledon School District (“District”) is aninstrumentality of the State of New Jersey, established to function as an educational institution. TheBorough of Haledon School District is a Type II district located in the County of Passaic, State of NewJersey. As a Type II district, the School District functions independently through a Board of Education. Theboard is comprised of nine members elected to three-year terms. The purpose of the District is to educatestudents in grades K-8. A superintendent is appointed by the Board and is responsible for the administrativecontrol of the District. Under existing statutes, the Board’s duties and powers include, but are not limitedto, the development and adoption of a school program; the establishment, organization and operation ofschools; and the acquisition, maintenance and disposition of school property.

The Board also has broad financial responsibilities, including the approval of the annual budget and theestablishment of a system of accounting and budgetary controls.

Governmental Accounting Standards Board publication, Codification of Governmental Accounting andFinancial Reporting Standards, Section 2100, “Defining the Financial Reporting Entity” establishesstandards to determine whether a governmental component unit should be included in the financial reportingentity. The basic criterion for inclusion or exclusion from the financial reporting entity is the exercise ofoversight responsibility over agencies, boards and commissions by the primary government. The exerciseof oversight responsibility includes financial interdependency and a resulting financial benefit or burdenrelationship, selection of governing authority, designation of management, ability to significantly influenceoperations, and accountability for fiscal matters. In addition, certain legally separate, tax-exempt entitiesthat meet specific criteria (i.e. benefit of economic resources, access/entitlement to economic resources, andsignificance) should be included in the financial reporting entity. The combined financial statements includeall funds of the District over which the Board exercises operating control. The District operates a K thru8 school located in the Borough of Haledon. There were no additional entities required to be included inthe reporting entity under the criteria as described above, in the current fiscal year. Furthermore, the Districtis not includable in any other reporting entity on the basis of such criteria.

B. Basis of Presentation:

The Board’s basic financial statements consist of District-wide statements, including a statement of netposition and a statement of activities, and fund financial statements which provide a more detailed level offinancial information.

-32-


NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, (continued)

B. Basis of Presentation: (continued)

District-wide Financial Statements:

The statement of net position and the statement of activities display information about the Board as a whole. These statements include the financial activities of the overall District, except for the fiduciary funds. Thestatements distinguish between those activities of the Board that are governmental and those that areconsidered business-type activities.

The statement of net position presents the financial condition of the governmental and business-typeactivities of the Board at year-end. The statement of activities presents a comparison between directexpenses and program revenues for each program or function of the governmental activities and for thebusiness-type activities of the Board. Direct expenses are those that are specifically associated with aservice, program or department and therefore clearly identifiable to a particular function. Program revenuesinclude charges paid by the recipient of the goods or services offered by the program, grants andcontributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues which are not classified as program revenues are presented as general revenues of the Board, withcertain limited exceptions. The comparison of direct expenses with program revenues identifies the extentto which each business segment or governmental function is self-financing or draws from the generalrevenues of the Board.

Fund Financial Statements:

During the fiscal year, the School District segregates transactions related to certain School District functionsor activities in separate funds in order to aid financial management and to demonstrate legal compliance. The fund financial statements provide information about the District’s funds, including its fiduciary funds. Separate statements for each fund category - government, proprietary, and fiduciary - are presented. TheNew Jersey Department of Education (NJDOE) has elected to require New Jersey districts to treat eachgovernmental fund as a major fund in accordance with the option noted in GASB No. 34, paragraph 76. TheNJDOE believes that the presentation of all funds as major is important for public interest and to promoteconsistency among district financial reporting models. The various funds of the Board are grouped into thecategories governmental, proprietary and fiduciary.

GOVERNMENTAL FUNDS

Governmental funds are those through which most governmental functions of the Board arefinanced. Governmental fund reporting focuses on the sources, uses and balances of currentfinancial resources. Expendable assets are assigned to the various governmental funds according tothe purposes for which they may or must be used. Current liabilities are assigned to the fund fromwhich they will be paid. The difference between governmental fund assets and liabilities is reportedas fund balance. The following are the Board’s governmental funds:

-33-




General Fund - The General Fund is the general operating fund of the Board. It is used to account forall financial resources except those required to be accounted for in another fund. Included are certainexpenditures for vehicles and movable instructional or noninstructional equipment which are classifiedin the Capital Outlay subfund.

As required by the New Jersey State Department of Education, the Board includes budgeted CapitalOutlay in this fund. Accounting principles generally accepted in the United States of America as theypertain to governmental entities state that General Fund resources may be used to directly financecapital outlays for long-lived improvements as long as the resources in such cases are derivedexclusively from unrestricted revenues.

Resources for budgeted capital outlay purposes are normally derived from State of New Jersey Aid,District taxes and appropriated fund balance. Expenditures are those that result in the acquisition ofor additions to fixed assets for land, existing buildings, improvements of grounds, construction ofbuildings, additions to or remodeling of buildings and the purchase of built-in equipment. Theseresources can be transferred from and to Current Expense by board resolution.

Special Revenue Fund - The Special Revenue Fund is used to account for the proceeds of specificrevenue from State and Federal Government, (other than major capital projects, Debt Service or theEnterprise Funds) and local appropriations that are legally restricted to expenditures for specifiedpurposes.

Capital Projects Fund - The Capital Projects Fund is used to account for all financial resources to beused for the acquisition or construction of major capital facilities (other than those financed byProprietary Funds). The financial resources are derived from sale of bonds, lease purchases and otherrevenues.

Debt Service Fund - The debt service fund is used to account for the accumulation of resources forand the payment of principal and interest on bonds issued to finance major property acquisition,construction and improvement programs.

PROPRIETARY FUNDS

The focus of Proprietary Fund measurement is upon determination of net income, changes in netposition, financial position and cash flows. The accounting principles generally accepted in the UnitedStates of America applicable are those similar to businesses in the private sector. Proprietary funds areclassified as enterprise or internal service; the Board has no internal service funds. The following isa description of the Proprietary Funds of the Board:

-34-




Enterprise Funds - The Enterprise Funds are utilized to account for operations that are financed andoperated in a manner similar to private business enterprises -- where the intent of the Board is that thecosts (i.e. expenses including depreciation and indirect costs) of providing goods or services to thestudents on a continuing basis be financed or recovered primarily through user charges; or, where theBoard has decided that periodic determination of revenues earned, expenses incurred, and/or netincome is appropriate for capital maintenance, public policy, management control, accountability orother purposes.

The Board's Enterprise Fund is comprised of the Food Service program and the Summer Camp/AfterCare program.

FIDUCIARY FUNDS

Fiduciary Fund - Fiduciary Fund reporting focuses on net position and changes in net position. TheFiduciary Funds are used to account for assets held by the Board on behalf of individuals, privateorganizations, other governments and/or other funds. Fiduciary Funds include UnemploymentCompensation Insurance, Student Activities Fund and Payroll Agency Fund.

C. Measurement Focus:

District-wide Financial Statements

The District-wide statements (i.e., the statement of net position and the statement of activities) are preparedusing the economic resources measurements focus and the accrual basis of accounting. All assets andliabilities associated with the operation of the Board are included on the statement of net position, exceptfor fiduciary funds.

Fund Financial Statements

All governmental funds are accounted for using a flow of current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balancesheet. The statement of revenues, expenditures and changes in fund balances reports on the sources (i.e.,revenues and other financing sources) and uses (i.e., expenditures and other financing uses) of currentfinancial resources. This approach differs from the manner in which the governmental activities of theDistrict-wide financial statements are prepared. Governmental fund financial statements therefore includea reconciliation with brief explanations to better identify the relationship between the government-widestatements and the statements for governmental funds.

-35-



C. Measurement Focus: (continued)

Like the District-wide statements, all proprietary fund types are accounted for on a flow of economicresources measurement focus. All assets and all liabilities associated with the operation of these funds areincluded on the statement of net position. The statement of changes in fund net position presents increases(i.e., revenues) and decreases (i.e., expenses) in net total assets. The statement of cash flows providesinformation about how the Board finances and meets the cash flow needs of its proprietary activities.

D. Basis of Accounting:

Basis of accounting determines when transactions are recorded in the financial records and reported on thefinancial statements. The District-wide financial statements and the financial statements of the proprietaryand fiduciary funds are prepared using the accrual basis of accounting. Governmental funds use themodified accrual basis of accounting. Differences in the accrual and the modified accrual basis ofaccounting arise in the recognition of revenue, the recording of deferred revenue, and in the presentation ofexpenses versus expenditures.

Revenues - Exchange and Non-exchange Transactions

Revenue resulting from exchange transactions, in which each party gives and receives essentially equalvalue, is recorded on the accrual basis when the exchange takes place. On a modified accrual basis, revenueis recorded in the fiscal year in which the resources are measurable and become available. Available meansthat the resources will be collected within the current fiscal year or are expected to be collected soon enoughthereafter to be used to pay liabilities of the current fiscal year.

Nonexchange transactions, in which the Board receives value without directly giving equal value in return,include property taxes, grants, entitlements and donations. On an accrual basis, revenue from property taxesis recognized in the fiscal year for which the taxes are levied. Revenue from grants, entitlements anddonations is recognized in the fiscal year in which all eligibility requirements have been satisfied. Eligibilityrequirements include timing requirements, which specify the year when the resources are required to be usedor the year when use is first permitted, matching requirements, in which the Board must provide localresources to be used for a specified purpose, and expenditure requirements, in which the resources areprovided to the Board on a reimbursement basis. On a modified accrual basis, revenue from nonexchangetransactions must also be available before it can be recognized. Under GAAP, in accordance with GASBNo. 33, Accounting and Financial Reporting for Nonexchange Transactions, the last state aid payment is notconsidered revenue to the school district if the state has not recorded the corresponding expenditure, eventhough state law dictates recording the revenue.

Under the modified accrual basis, the following revenue sources are considered to be both measurable andavailable at year-end: ad valorem property taxes, tuition, unrestricted grants and interest.

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D. Basis of Accounting: (continued)

Expenses/Expenditures

On the accrual basis of accounting, expenses are recognized at the time they are incurred. The fair value ofdonated commodities used during the year is reported in the operating statement as an expense with a likeamount reported as donated commodities revenue.

The measurement of focus of governmental fund accounting is on decreases in net financial resources(expenditures) rather than expenses. Expenditures are generally recognized in the accounting period inwhich the related fund liability is incurred, if measurable. Allocations of cost, such as depreciation andamortization, are not recognized in the governmental funds.

E. Budgets/Budgetary Control:

Annual appropriated budgets are adopted in the spring of the preceding year for the general, and specialrevenue funds. The budgets are submitted to the county superintendents office for approval. Budgets areprepared using the modified accrual basis of accounting, except for the special revenue fund as describedlater. The legal level of budgetary control is established at line item accounts within each fund. Line itemaccounts are defined as the lowest (most specific) level of detail as established pursuant to the minimumchart of accounts referenced in N.J.A.C. 6A:23-2(g)1. Transfers of appropriations may be made by SchoolBoard resolution at any time during the fiscal year. The Board of Education did not make any materialsupplemental budgetary appropriations during the fiscal year.

Formal budgetary integration into the accounting system is employed as a management control device duringthe year. For governmental funds there are no substantial differences between the budgetary basis ofaccounting and accounting principles generally accepted in the United States of America with the exceptionof the legally mandated revenue recognition of the last state aid payment for budgetary purposes only andspecial revenue fund as noted below. Encumbrance accounting is also employed as an extension of formalbudgetary integration in the governmental fund types. Unencumbered appropriations lapse at fiscal year end.

The accounting records of the special revenue fund are maintained on the grant accounting budgetary basis. The grant accounting budgetary basis differs from GAAP in that the grant accounting budgetary basisrecognizes encumbrances as expenditures and also recognizes the related revenues, whereas the GAAP basisdoes not. Sufficient supplemental records are maintained to allow for the presentation of GAAP basisfinancial reports.

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F. Encumbrances:

Under encumbrance accounting purchase orders, contracts and other commitments for the expenditure ofresources are recorded to reserve a portion of the applicable appropriation. Open encumbrances ingovernmental funds, other than the special revenue fund, are reported as reservations of fund balances atfiscal year end as they do not constitute expenditures or liabilities but rather commitments related tounperformed contracts for goods and services.

Open encumbrances in the special revenue fund, for which the Board has received advances, are reflectedin the balance sheet as unearned revenues at fiscal year end.

The encumbered appropriation authority carries over into the next fiscal year. An entry will be made at thebeginning of the next fiscal year to increase the appropriation reflected in the certified budget by theoutstanding encumbrance amount as of the current fiscal year end.

G. Cash, Cash Equivalents and Investments:

Cash and cash equivalents include petty cash, change funds, cash in banks and all highly liquid investmentswith a maturity of three months or less at the time of purchase and are stated at cost plus accrued interest. U.S. Treasury and agency obligations and certificates of deposit with maturities of one year or less whenpurchased are stated at cost. All other investments are stated at fair value.

New Jersey school districts are limited as to the types of investments and types of financial institutions theymay invest in. New Jersey statute 18A:20-37 provides a list of permissible investments that may bepurchased by New Jersey school districts.

Additionally, the Board has adopted a cash management plan that requires it to deposit public funds in publicdepositories protected from loss under the provisions of the Governmental Unit Deposit Protection Act("GUDPA"). GUDPA was enacted in 1970 to protect Governmental Units from a loss of funds on depositwith a failed banking institution in New Jersey.

N.J.S.A. 17:9-41 et. seq. establishes the requirements for the security of deposits of governmental units. Thestatute requires that no governmental unit shall deposit public funds in a public depository unless such fundsare secured in accordance with the Act. Public depositories include Savings and Loan institutions, banks(both state and national banks) and savings banks the deposits of which are federally insured. All publicdepositories must pledge collateral, having a market value at least equal to five percent of the average dailybalance of collected public funds, to secure the deposits of Governmental Units. If a public depository fails,the collateral it has pledged, plus the collateral of all other public depositories, is available to pay the fullamount of their deposits to the Governmental Units.

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H. Tuition Receivable:

Tuition charges were established by the District based on estimated costs. The charges are subject toadjustment when final costs have been determined.

I. Tuition Payable:

Tuition charges were established by the receiving district. The charges are subject to adjustment when thefinal costs have been determined.

J. Inventories:

On District-wide financial statements, inventories are presented at cost, which approximates market on afirst-in, first-out basis and are expensed when used.

On fund financial statements inventories are valued at cost, which approximates market, using thefirst-in-first-out (FIFO) method. Inventories of proprietary funds consist of food and goods held for resale,as well as supplies, and are expensed when used.

K. Prepaid Items:

Payments made to vendors for services that will benefit periods beyond June 30, 2018, are recorded asprepaid items using the consumption method. A current asset for the prepaid amount is recorded at the timeof purchase and an expenditure/expense is reported in the year in which services are consumed.

L. Short-Term Interfund Receivables/Payables:

On fund financial statements, receivables and payables resulting from short-term interfund loans areclassified as “interfund receivables/payables.” These amounts are eliminated in the governmental andbusiness-type activities columns of the statement of net position, except for the net residual amounts duebetween governmental and business-type activities, which are presented as internal balances.

M. Capital Assets:

General capital assets are those assets not specifically related to activities reported in the enterprise fund. These assets generally result from expenditures in the governmental funds. These assets are reported in thegovernmental activities column of the district -wide statement of net position but are not reported in the fundfinancial statements. Capital assets utilized by the enterprise fund are reported both in the business-typeactivity column of the District-wide statement of net position and in the fund.

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M. Capital Assets: (continued)

All capital assets acquired or constructed during the year are recorded at actual cost. Donated fixed assetsare valued at their estimated fair market value on the date received. The capital assets acquired orconstructed prior to June 30, 1993 are valued at cost based on historical records or through estimationprocedures performed by an independent appraisal company. Donated capital assets are valued at theirestimated fair market value on the date received. The Board maintains a capitalization threshold of$2,000.00. The Board does not possess any infrastructure. Improvements are capitalized; the costs ofnormal maintenance and repairs that do not add to the value of the asset or materially extend an asset’s lifeare not.

All reported capital assets except land and construction in progress are depreciated. Improvements aredepreciated over the remaining useful lives of the related capital assets. Depreciation is computed using thestraight-line method over the following useful lives:

Description

GovernmentalActivities

Estimated Lives

Business-TypeActivity

Estimated LivesSites and Improvements 20 years N/ABuildings and Improvements 7-50 years N/AFurniture, Equipment and Vehicles 5-20 years 5-20 years

N. Compensated Absences:

Compensated absences are those absences for which employees will be paid, such as vacation, sick leave,and sabbatical leave. A liability for compensated absences that are attributable to services already rendered,and that are not contingent on a specific event that is outside the control of the Board and its employees, isaccrued as the employees earn the rights to the benefits. Compensated absences that relate to future services,or that are contingent on a specific event that is outside the control of the Board and its employees, areaccounted for in the period in which such services are rendered or in which such events take place.

For the District-wide Statements, the current portion is the amount estimated to be used in the followingyear. In accordance with GAAP, for the governmental funds, in the Fund Financial Statements, all of thecompensated absences are considered long-term and therefore, are not a fund liability and represents areconciling item between the fund level and District-wide presentations.

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O. Unearned Revenue:

Unearned revenue arises when assets are recognized before revenue recognition criteria have been satisfied.

Unearned revenue in the special revenue fund represents cash that has been received but not yet earned. SeeNote 1(F) regarding the special revenue fund.

P. Accrued Liabilities and Long-term Obligations:

All payables, accrued liabilities and long-term obligations are reported in the District-wide financialstatements.

In general, governmental fund payables and accrued liabilities that, once incurred, are paid in a timelymanner and in full from current financial resources, are reported as obligations of the funds. However,claims and judgements, compensated absences, special termination benefits and contractually requiredpension contributions that will be paid from governmental funds are reported as a liability in the fundfinancial statements only to the extent that they are due for payment in the current year. Bonds, long-termobligations, and capital leases that will be paid from governmental funds are recognized as a liability in thefund financial statements when due.

Q. Accounting and Financial Reporting for Pensions:

In fiscal year 2015, the District implemented GASB 68. This Statement amends GASB Statement No. 27.It improves accounting and financial reporting by state and local governments for pensions. It also improvesinformation provided by state and local government employers about financial support for pensions that isprovided by other entities. This Statement results from a comprehensive review of the effectiveness ofexisting standards of accounting and financial reporting for pensions with regard to providing decision usefulinformation, supporting assessments of accountability and interperiod equity, and creating additionaltransparency. This Statement replaces the requirement of Statement No. 27, Accounting for Pension by Stateand Local Governmental Employers, as well as the requirements of Statement No. 50, Pension Disclosures,as they relate to pensions that are provided through pension plans administered as trusts or equivalentarrangements that meet certain criteria. The requirements of Statements 27 and 50 remain applicable forpensions that are not covered by the scope of this Statement.

The District has also implemented GASB Statement 71, Pension Transition for Contributions madeSubsequent to the Measurement Date-an amendment to GASB No. 68. The objective of this Statement isto address an issue regarding application of the transition provisions of Statement No. 68, Accounting andFinancial Reporting for Pensions. The issue relates to amounts associated with contributions, if any, madeby a state or local government employer or nonemployer contributing entity to a defined benefit pension planafter the measurement date of the government's beginning net pension liability.

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Q. Accounting and Financial Reporting for Pensions: (continued

Statement 68 requires a state or local government employer (or nonemployer contributing entity in a specialfunding situation) to recognize a net pension liability measured as of a date (the measurement date) no earlierthan the end of its prior fiscal year. If a state or local government employer or nonemployer contributingentity makes a contribution to a defined benefit pension plan between the measurement date of the reportednet pension liability and the end of the government's reporting period, Statement 68 requires that thegovernment recognize its contribution as a deferred outflow of resources.

In addition, Statement 68 requires recognition of deferred outflows of resources and deferred inflows ofresources for changes in the net pension liability of a state or local government employer or nonemployercontributing entity that arise from other types of events. At transition to Statement 68, if it is not practicalfor an employer or nonemployer contributing entity to determine the amounts of all deferred outflows ofresources and deferred inflows of resources related to pensions, paragraph 137 of Statement 68 required thatbeginning balances for deferred outflows of resources and deferred inflows of resources not be reported.Consequently, if it is not practical to determine the amounts of all deferred outflows of resources anddeferred inflows of resources related to pensions, contributions made after the measurement date of thebeginning net pension liability could not have been reported as deferred outflows of resources at transition.This could have resulted in a significant understatement of an employer or nonemployer contributing entity'sbeginning net position and expense in the initial period of implementation.

This Statement amends paragraph 137 of Statement 68 to require that, at transition, a government recognizea beginning deferred outflow of resources for its pension contributions, if any, made subsequent to themeasurement date of the beginning net pension liability. Statement 68, as amended, continues to require thatbeginning balances for other deferred outflows of resources and deferred inflows of resources related topensions be reported at transition only if it is practical to determine all such amounts.

R. Deferred Outflows/Inflows of Resources:

In addition to assets, the statement of financial position will sometimes report a separate section for deferredoutflows of resources. This separate financial statement element, deferred outflows of resources, representsa consumption of net position that applies to a future period(s) and so will not be recognized as an outflowof resources (expense/expenditure) until then. Currently, the District has only one item that qualifies forreporting in this category, deferred amounts related to pension.

In addition to liabilities, the statement of financial position will sometimes report a separate section fordeferred inflows of resources. This separate financial statement element, deferred inflows of resources,represents an acquisition of net position that applies to a future period(s) and so will not be recognized asan inflow of resources (revenue) until that time. The District has one item that qualifies in this category,deferred amounts related to pension.

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S. Fund Balances:

Fund balance is divided into five classifications based primarily on the extent to which the Board is boundto observe constraints imposed upon the resources in the governmental funds. The classifications are asfollows:

• Nonspendable fund balance includes amounts that are not in a spendable form (inventory, forexample) or are required to be maintained intact (the principal of an endowment fund, forexample).

• Restricted fund balance includes amounts that can be spent only for the specific purposesstipulated by external resource providers (for example, grant providers), constitutionally,or through enabling legislation (that is, legislation that creates a new revenue source andrestricts its use). Effectively, restrictions may be changed or lifted only with the consent ofresource providers.

• Committed fund balance includes amounts that can be used only for the specific purposesdetermined by a formal action of the Board’s highest level of decision-making authority. Commitments may be changed or lifted only by the government taking the same formalaction that imposed the constraint originally.

• Assigned fund balance comprises amounts intended to be used by the Board for specificpurposes. Intent can be expressed by the governing body or by an official or body to whichthe governing body delegates the authority. In governmental funds other than the generalfund, assigned fund balance represents the amount that is not restricted or committed. Thisindicates that resources in other governmental funds are, at a minimum, intended to be usedfor the purpose of that fund.

• Unassigned fund balance is the residual classification for the general fund and includes allamounts not contained in the other classifications. Unassigned amounts are technicallyavailable for any purpose. If another governmental fund has a fund balance deficit, then itwill be reported as a negative amount in the unassigned classification in that fund. Positiveunassigned amounts will be reported only in the general fund.

T. Net Position:

Net position represent the difference between assets and deferred outflows of resources and liabilities anddeferred inflows of resources. Net position invested in capital assets, net of related debt consists of capitalassets, net of accumulated depreciation, reduced by the outstanding balances of any borrowings used for the

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T. Net Position: (continued)

acquisition, construction or improvement of those assets. Net position is reported as restricted when thereare limitations imposed on their use either through the enabling legislation adopted by the Board or throughexternal restrictions imposed by creditors, grantors or laws or regulations of other governments.

The Board applies restricted resources first when an expense is incurred for purposes for which bothrestricted and unrestricted net position are available.

U. Operating Revenues and Expenses:

Operating revenues are those revenues that are generated directly from the primary activity of the proprietaryfunds. For the Board, these revenues are sales for food service. Operating expenses are necessary costsincurred to provide the good or service that is the primary activity of the fund.

V. Extraordinary and Special Items:

Extraordinary items are transactions or events that are both unusual in nature and infrequent in occurrence. Special items are transactions or events that are within the control of the Board and that are either unusualin nature or infrequent in occurrence. Neither type of transaction occurred during the fiscal year.

W. Allocation of Indirect Expenses:

The District reports all direct expenses by function in the Statement of Activities. Direct expenses are thosethat are clearly identifiable with a function. Indirect expenses are allocated to functions but are reportedseparately in the Statement of Activities. Employee benefits, including the employer’s share of socialsecurity, workers compensation, and medical and dental benefits, were allocated based on salaries of thatprogram. TPAF on-behalf contributions and changes in compensated absences have not been allocated andhave been reported as unallocated benefits on the Statement of Activities. Depreciation expense, wherepracticable, is specifically identified by function and is included in the indirect expense column of theStatement of Activities. Depreciation expense that could not be attributed to a specific function isconsidered an indirect expense and is reported separately on the Statement of Activities as unallocateddepreciation. Interest on long-term debt is considered an indirect expense and is reported separately on theStatement of Activities.

X. Use of Estimates:

The preparation of financial statements in accordance with accounting principles generally accepted in theUnited States of America requires management to make estimates and assumptions that effect certainreports, amounts and disclosures. Accordingly, actual results could differ from those estimates.

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Y. Recent Accounting Pronouncements:

The Government Accounting Standards Board issued GASB Statement No. 75, Accounting and FinancialReporting for Postemployment Benefits Other Than Pensions. This Statement applies to governmentemployers who provided OPEB plans to their employees and basically parallels GASB Statement 68 andreplaces GASB Statement 45. The Statement is effective for fiscal years beginning after June 15, 2017 andwas implemented by the District for the year ended June 30, 2018.

In March 2016, the Government Accounting Standards Board issued GASB Statement No. 81, IrrevocableSplit-Interest Agreements. The objective of this Statement is to improve accounting and financial reportingfor irrevocable split-interest agreements by providing recognition and measurement guidance for situationsin which a government is a beneficiary of the agreement. The District does not believe this Statement willhave any effect on future financial statements.

In November 2016, the Government Accounting Standards Board issued GASB Statement No. 83, CertainAsset Retirement Obligations. This Statement establishes criteria for determining the timing and pattern ofrecognition of a liability and a corresponding deferred outflows of resources for asset retirement obligations(AROs). The District does not believe this Statement will have any effect on future financial statements.

In January 2017, the Government Accounting Standards Board issued GASB Statement No. 84, FiduciaryActivities. This Statement establishes criteria for identifying fiduciary activities of all state and localgovernments. The focus on the criteria generally is on (1) whether a government is controlling the assetsof the fiduciary activity and (2) the beneficiaries with whom a fiduciary relationship exists. Separate criteriaare included to identify component units and postemployment benefit arrangements that are fiduciaryactivities. The District is currently evaluating the effects, if any, this Statement may have on future financialstatements.

In March 2017, the Government Accounting Standards Board issued GASB Statement No. 85, Omnibus2017, which addresses practice issues that have been identified during the implementation and applicationof certain GASB statements. This Statement addresses a variety of topics including issues relating toblending component units, goodwill, fair value measurement and application, and postemployment benefits. The District implemented this Statement for the year ended June 30, 2018.

In May 2017, the Governmental Accounting Standards Board issued GASB Statement No. 86, Certain DebtExtinguishment Issues, which improves consistency in accounting and financial reporting for in-substancedefeasance of debt by providing guidance for transactions in which cash and other monetary assets acquiredwith only existing resources—resources other than the proceeds of refunding debt—are placed in anirrevocable trust for the sole purpose of extinguishing debt. This Statement also improves accounting andfinancial reporting for prepaid insurance on debt that is extinguished and notes to financial statements fordebt that is defeased in substance. The requirements of this Statement are effective for reporting periodsbeginning after June 15, 2017. The District had no transactions of this type for the year ended June 30, 2018.

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Y. Recent Accounting Pronouncements:

In June 2017, the Government Accounting Standards Board issued GASB Statement No. 87, Leases, whichimproves accounting and financial reporting for leases by governments. This Statement requires recognitionof certain lease assets and liabilities for leases that previously were classified as operating leases andrecognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the fundamental principle that leases arefinancings of the right to use an underlying asset. The requirements of this Statement are effective forreporting periods beginning after December 15, 2019. The District is currently reviewing what effect, if any,this Statement may have on future financial statements.

In March 2018, Government Accounting Standards Board issued GASB Statement No. 88, CertainDisclosures Related to Debt, Including Direct Borrowings and Direct Placement. The objective of thisStatement is to improve consistency in the information that is disclosed in notes to government financialstatements related to debt, including direct borrowings and direct placements, and to provide financialstatement users with additional essential information about debt. This Statement is effective for reportingperiods beginning after June 15, 2018. The District believes this may impact the disclosures relating to debtin the notes to the financial statements.

NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS

Cash

Custodial Credit Risk - Deposits

Custodial credit risk is the risk that in the event of a bank failure, the government’s deposits may not bereturned to it. The District’s policy is based on New Jersey Statutes requiring cash be deposited only in NewJersey based banking institutions that participate in New Jersey Governmental Depository Protection Act(GUDPA) or in qualified investments established in New Jersey Statutes 18A:20-37 that are treated as cashequivalents. As of June 30, 2018, $-0- of the District’s bank balance of $1,184,543.59 was exposed tocustodial credit risk.

Investments

Investment Rate Risk

The District does not have a formal investment policy that limits investment maturities as a means ofmanaging its exposure to fair value losses arising from increasing interest rates. However, New JerseyStatutes 18A:20-37 limits the length of time for most investments to 397 days.

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NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS, (continued)

Credit Risk

New Jersey Statutes 18A:20-37 limits school district investments to those specified in the Statutes. The typeof allowable investments are Bonds of the United States of America, bonds or other obligations of the schooldistrict or bonds or other obligations of the local unit or units within which the school district is located;obligations of federal agencies not exceeding 397 days; government money market mutual funds; the Stateof New Jersey Cash Management Plan; local government investment pools; or repurchase of fullycollateralized securities.

Concentration of Credit Risk

The District places no limit on the amount the District may invest in any one issuer.

NOTE 3. RECEIVABLES

Receivables at June 30, 2018, consisted of accounts and intergovernmental. All receivables are consideredcollectible in full. A summary of the principal items of intergovernmental receivables follows:

GovernmentalFund Financial

Statements

Proprietary/Enterprise

Fund

District WideFinancial

Statements

State Aid $69,101.30 $621.92 $69,723.22Federal Aid 382,679.00 38,302.14 420,981.14Other 1,951.23 5,517.87 7,469.10Interfunds 299,177.18 25.89Gross Receivables 752,908.71 44,441.93 498,199.35Less: Allowance for Uncollectibles Total Receivables, Net $752,908.71 $44,441.93 $498,199.35

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NOTE 4. INTERFUND BALANCES AND ACTIVITY

Balance due to/from other funds at June 30, 2018, consist of the following:

$25.89 Due to the General Fund from the Fiduciary Fund for interest earned

231,040.89 Due to the General Fund from the Special Revenue Fund for short term loan.

2,496.84 Due to the Fiduciary Fund from the General Fund for short term loan.

68,110.40 Due to the General Fund from the Enterprise Fund for Enterprise Fund expenditures

$301,674.02

It is anticipated that all interfunds will be liquidated during the fiscal year.

NOTE 5. CAPITAL ASSETS

Capital asset activity for the fiscal year ended June 30, 2018 was as follows:

Balance

6/30/17 Additions Deductions

Balance

6/30/18

Governmental Activities

Capital Assets, Not Being Depreciated

Land $1,122,000.00 $ $ $1,122,000.00

Total Capital Assets, Not Being Depreciated 1,122,000.00 1,122,000.00

Capital Assets Being Depreciated

Land Improvements 689,572.72 37,710.00 727,282.72

Buildings and Improvements 13,574,888.68 482,858.58 14,057,747.26

Furniture, Equipment and Vehicles 1,537,390.23 275,977.64 1,813,367.87

Total Capital Assets, Being Depreciated 15,801,851.63 796,546.22 16,598,397.85

Less Accumulated Depreciation:

Land Improvements (271,217.11) (24,515.30) (295,732.41)

Buildings and Improvements (5,055,446.94) (354,031.19) (5,409,478.13)

Furniture, Equipment and Vehicles (740,092.68) (215,251.17) (955,343.85)

Total Accumulated Depreciation (6,066,756.73) (593,797.66) (6,660,554.39)

Total Capital Assets, Being Depreciated, Net 9,735,094.90 202,748.56 9,937,843.46

Governmental Activities Capital Assets, Net $10,857,094.90 $202,748.56 $ $11,059,843.46

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NOTE 5. CAPITAL ASSETS, (continued)

Balance

6/30/17 Additions Deductions

Balance

6/30/18

Business-Type Activity

Machinery and Equipment $421,228.07 $48,090.36 $ $469,318.43

Less Accumulated Depreciation for

Machinery and Equipment (219,205.70) (17,681.82) (236,887.52)

Business-Type Activity Capital Assets, Net $202,022.37 $30,408.54 $0.00 $232,430.91

Depreciation expense was charged to governmental functions as follows:

Regular Instruction $124,223.43

School Administrative Services 8,448.28

Plant Operations and Maintenance 8,513.46

Pupil Transportation 9,097.54

Unallocated Depreciation 443,514.95

$593,797.66

NOTE 6. LONG-TERM OBLIGATION ACTIVITY

Changes in long-term obligations for the year ended June 30, 2018 were as follows:

Balance

June 30, 2017 Issued Retired

Balance

June 30, 2018

Amounts

Due Within

One Year

Compensated Absences Payable $117,875.85 $10,298.89 ($17,092.46) $111,082.28 $

Net Pension Liability 4,825,930.00 (1,089,850.00) 3,736,080.00

$4,943,805.85 $10,298.89 ($1,106,942.46) $3,847,162.28 $0.00

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NOTE 6. LONG-TERM OBLIGATION ACTIVITY, (continued)

A. Bonds Payable:

Bonds are authorized in accordance with State law by the voters of the municipality through referendums. All bonds are retired in serial installments within the statutory period of usefulness. Bonds issued by theBoard are general obligation bonds.

As of June 30, 2018, the Board had no outstanding bonds payable.

B. Bonds Authorized But Not Issued:

As of June 30, 2018, the Board has no authorized but not issued bonds.

C. Capital Leases Payable:

The District had no capital leases outstanding at June 30, 2018.

NOTE 7. OPERATING LEASES:

The District has commitments to lease copiers under an operating lease that expires in September of 2019. Total operating lease payments made during the year ended June 30, 2018 were $16,164.00. Futureminimum lease payments are as follows:

YearEnding Amount

6/30/19 $16,164.006/30/20 2,694.00

Total future minimum lease payments $18,858.00

NOTE 8. PENSION PLANS

Description of Plans - All required employees of the District are covered by either the Public Employees'Retirement System or the Teachers' Pension and Annuity Fund which have been established by state statuteand are administered by the New Jersey Division of Pension and Benefits (Division). According to the Stateof New Jersey Administrative Code, all obligations of both Systems will be assumed by the State of NewJersey should the Systems terminate. The Division issues a publicly available financial report that includesthe financial statements and required supplementary information for the Public Employees RetirementSystem and the Teachers' Pension and Annuity Fund. These reports may be obtained by writing to theDivision of Pensions and Benefits, PO Box 295, Trenton, New Jersey, 08625 or reports can be accessed onthe internet at: http://www.state.nj.us/treasury/pensions/annrpts_archive.htm.

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http://www.state.nj.us/treasury/pensions/annrpts_archive.htm


NOTE 8. PENSION PLANS, (continued)

Teachers' Pension and Annuity Fund (TPAF) - The Teachers' Pension and Annuity Fund was establishedas of January 1, 1955, under the provisions of N.J.S.A. 18A:66 to provide retirement benefits, death,disability and medical benefits to certain qualified members. The Teachers' Pension and Annuity Fund isconsidered a cost-sharing multiple-employer plan with a special funding situation, as under current statute,all employer contributions are made by the State of New Jersey on behalf of the District and the system'sother related non-contributing employers. Membership is mandatory for substantially all teachers ormembers of the professional staff certified by the State Board of Examiners, and employees of theDepartment of Education who have titles that are unclassified, professional and certified.

Benefits Provided

The vesting and benefit provisions are set by N.J.S.A. 18A:66. TPAF provides retirement, death anddisability benefits. All benefits vest after ten years of service, except for medical benefits, which vest after25 years of service or under the disability provisions of TPAF. Members are fully vested for their owncontributions and, after three years of service credit, become vested for 2% of related interest earned on thecontributions. In the case of death before retirement, members' beneficiaries are entitled to full interestcredited to the members' accounts.

The following represents the membership tiers for TPAF:

Tier Definition

1 Members who were enrolled prior to July 1, 2007 2 Members who were eligible to enroll on or after July 1, 2007 and prior to November 2, 2008 3 Members who were eligible to enroll on or after November 2, 2008 and prior to May 22, 2010 4 Members who were eligible to enroll on or after May 22, 2010 and prior to June 28, 2011 5 Members who were eligible to enroll on or after June 28, 2011

Service retirement benefits of 1/55 of final average salary for each year of service credit is available to Tiersth

1 and 2 members upon reaching age 60 and to Tier 3 members upon reaching age 62. Service retirementbenefits of 1/60 of final average salary for each year of service credit is available to Tier 4 members uponth

reaching age 62 and to Tier 5 members upon reaching age 65. Early retirement benefits are available toTiers 1 and 2 members before reaching age 60, to Tiers 3 and 4 before age 62 with 25 or more years ofservice credit and Tier 5 with 30 or more years of service credit before age 65. Benefits are reduced by afraction of a percent for each month that a member retires prior to the age at which a member can receivefull early retirement benefits in accordance with their respective tier. Tier 1 members can receive anunreduced benefit from age 50 to age 60 if they have at least 25 years of service. Deferred retirement isavailable to members who have at least 10 years of service credit and have not reached the service retirementage for the respective tier.

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NOTE 8. PENSION PLANS: (continued)

Public Employees' Retirement System (PERS) - The Public Employees' Retirement System (PERS) wasestablished as of January 1, 1955 under the provisions of N.J.S.A. 43:15A to provide retirement, death,disability and medical benefits to certain qualified members. The Public Employees' Retirement System isa cost-sharing multiple-employer plan. Membership is mandatory for substantially all full-time employeesof the State of New Jersey or any county, municipality, school district, or public agency, provided theemployee is not required to be a member of another state-administered retirement system or other state orlocal jurisdiction.

Benefits Provided

The vesting and benefit provisions are set by N.J.S.A. 43:15A. PERS provides retirement, death anddisability benefits. All benefits vest after ten years of service, except for medical benefits, which vest after25 years of service or under the disability provisions of PERS.

The following represents the membership tiers for PERS:

Tier Definition

1 Members who were enrolled prior to July 1, 2007 2 Members who were eligible to enroll on or after July 1, 2007 and prior to November 2, 2008 3 Members who were eligible to enroll on or after November 2, 2008 and prior to May 22, 2010 4 Members who were eligible to enroll on or after May 22, 2010 and prior to June 28, 2011 5 Members who were eligible to enroll on or after June 28, 2011

Service retirement benefits of 1/55 of final average salary for each year of service credit is available to Tiersth

1 and 2 members upon reaching age 60 and to Tier 3 members upon reaching age 62. Service retirementbenefits of 1/60 of final average salary for each year of service credit is available to Tier 4 members uponth

reaching age 62 and to Tier 5 members upon reaching age 65. Early retirement benefits are available toTiers 1 and 2 members before reaching age 60, to Tiers 3 and 4 before age 62 with 25 or more years ofservice credit and Tier 5 with 30 or more years of service credit before age 65. Benefits are reduced by afraction of a percent for each month that a member retires prior to the age at which a member can receivefull early retirement benefits in accordance with their respective tier. Tier 1 members can receive anunreduced benefit from age 50 to age 60 if they have at least 25 years of service. Deferred retirement isavailable to members who have at least 10 years of service credit and have not reached the service retirementage for the respective tier.

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Defined Contribution Retirement Program

Prudential Financial jointly administers the DCRP investments with the NJ Division of Pensions andBenefits. If an employee is ineligible to enroll in the PERS or PFRS, the employee may be eligible to enrollin the DCRP. DCRP provides eligible members with a tax-sheltered, defined contribution retirementbenefit, along with life insurance and disability coverage. Vesting is immediate upon enrollment formembers of the DCRP.

The State of New Jersey, Department of the Treasury, Division of Pensions and Benefits, issues publiclyavailable financial reports that include the financial statements and required supplementary information ofthe DCRP. The financial reports may be obtained by writing to the State of New Jersey, Department of theTreasury, Division of Pensions and Benefits, PO Box 295, Trenton, New Jersey, 08625-0295.

Employers are required to contribute at an actuarially determined rate. Employee contributions are basedon percentages of 5.50% for DCRP of employees' annual compensation, as defined. The DCRP wasestablished July 1, 2007, under the provisions of Chapter 92, P.L. 2007 and expanded under the provisionsof Chapter 89, P.L. 2008. Employee contributions for DCRP are matched by a 3% employer contribution.

Contributions Requirements Fund Based Statements

The Board’s contribution to PERS AND DCRP, equal to the required contributions for each year as reportedin the fund based statements, were as follows:

YearEnding PERS DCRP6/30/18 $148,682.00 $2,017.276/30/17 144,757.00 1,770.81 6/30/16 135,663.00 1,774.09

The State of New Jersey contribution to TPAF (paid on-behalf of the District) for normal and post retirementbenefits have been included in the fund-based statements as revenues and expenditures in accordance withGASB 24, paragraphs 7 through 13, as follows:

YearEnding

PensionContributions

Post-RetirementMedical

ContributionsNCGI

Premium

Long-TermDisabilityLiability

6/30/18 $1,065,654.00 $704,986.00 $25,861.00 $1,848.00

6/30/17 797,457.00 688,538.00 28,894.00 2,502.00

6/30/16 516,332.00 645,434.00 25,720.00

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In addition, the post-retirement medical benefits are included in the district-wide financial statements.

Also, in accordance with N.J.S.A. 18A:66-66 the State of New Jersey reimbursed the Board $559,442.83during the year ended June 30, 2018 for the employer’s share of social security contributions for TPAFmembers as calculated on their base salaries. This amount has been included in the fund-based statementsas revenues and expenditures in accordance with GASB 24, paragraphs 7 through 13.

ACCOUNTING AND FINANCIAL REPORTING FOR PENSION IN THE DISTRICT-WIDESTATEMENTS PER - GASB NO. 68

Public Employees Retirement System (PERS)

At June 30, 2018, the District had a liability of $3,736,080.00 for its proportionate share of the PERS netpension liability. The net pension liability was measured as of June 30, 2017, and the total pension liabilityused to calculate the net pension liability was determined by an actuarial valuation as of that date. TheDistrict's proportion of the net pension liability was based on a projection of the District's long-term shareof contributions to the pension plan relative to the projected contributions of all participating governmentalentities, actuarially determined. At June 30, 2017, the District's proportion was 0.0160495565 percent,which was a decrease of 0.0002448297 percent from its proportion measured as of June 30, 2016.

For the year ended June 30, 2018, the District recognized pension expense of $290,017.00. At June 30,2018, deferred outflows of resources and deferred inflows of resources related to PERS from the followingsources:

DeferredOutflows ofResources

DeferredInflows ofResources

Changes of assumptions $752,691.00 $749,932.00Difference in actual and expected experience 87,972.00Net difference between projected and actual earnings on pension plan investments

25,440.00

Changes in proportion and differences between District contributions and proportionate share of contributions 107,959.00 52,604.00District contributions subsequent to the measurement date 151,656.00

Total $1,125,718.00 $802,536.00

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The $151,656.00 reported as deferred outflows of resources related to pensions resulting from school districtcontributions subsequent to the measurement date (i.e. for the school year ending June 30, 2018, the planmeasurement date is June 30, 2017) will be recognized as a reduction of the net pension liability in the yearended June 30, 2018. Other amounts reported as deferred outflows of resources and deferred inflows ofresources related to pensions (excluding changes in proportion) will be recognized in pension expense asfollows:

Year ended June 30:2018 $87,9512019 132,7202020 80,4212021 (106,961)2022 (77,960)

Changes in Proportion

The previous amounts do not include employer specific deferred outflows of resources and deferred inflowsof resources related to changes in proportion. These amounts should be recognized (amortized) by eachemployer over the average of the expected remaining service lives of all plan members, which is 5.48, 5.57,5.72 and 6.44 years for 2017, 2016, 2015 and 2014 amounts, respectively.

Additional Information

Local Group Collective balances at June 30, 2017 and June 30, 2016 are as follows:

June 30, 2017 June 30, 2016

Collective deferred outflows of resources $6,424,455,842 $8,685,338,380

Collective deferred inflows of resources 5,700,625,981 870,133,595

Collective net pension liability 23,278,401,588 29,617,131,759

District's Proportion 0.0160495565% 0.0162943862%

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Actuarial Assumptions

The total pension liability for the June 30, 2017 measurement date was determined by an actuarial valuationas of July 1, 2016, which rolled forward to June 30, 2017. This actuarial valuation used the followingassumptions, applied to all periods in the measurement.

Inflation 2.25 PercentSalary Increases: Through 2026 1.65-4.15 Percent (based on age) Thereafter 2.65-5.15 Percent (based on age)

Investment Rate of Return 7.00 Percent

The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarialexperience study for the period July 1, 2011 to June 30, 2014. It is likely that future experience will notexactly conform to these assumptions. To the extent that actual experience deviates from these assumptions,the emerging liabilities may be higher or lower than anticipated. The more the experience deviates, thelarger the impact on future financial statements.

Mortality Rates

Pre-retirement mortality rates were based on the RP-2000 Employee Pre-retirement Mortality Table for maleand female active participants. For State employees, mortality tables are set back 4 years for males andfemales. For local employees, mortality tables are set back 2 years for males and 7 years for females. Inaddition, the tables provide for future improvements in mortality from the base year of 2013 using agenerational approach based on the plans actuary’s modified MP-2014 projection scale. Post-retirementmortality rates were based on the RP-2000 Combined Healthy Male and Female Mortality Tables (setback1 year for males and females) for service retirements and beneficiaries of former members and a one yearstatic projection based on mortality improvement Scale AA. In addition, the tables for service retirementsand beneficiaries of former members provide for future improvements in mortality from the base year of2013 using a generational approach based on the plan actuary’s modified MP-2014 projection scale. Disability retirement rates used to value disabled retirees were based on the RP-2000 Disabled MortalityTable (set back 3 years for males and set forward 1 year for females).

Long-Term Rate of Return

In accordance with State statute, the long-term expected rate of return on plan investments (7.00% atJune 30, 2017) is determined by the State Treasurer, after consultation with the Directors of the Division ofInvestments and Division of Pensions and Benefits, the board of trustees and the actuaries. The long-termexpected rate of return was determined using a building block method in which best-estimate ranges ofexpected future real rates of return (expected returns, net of pension plan investment expense and inflation)

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are developed for each major asset class. These ranges are combined to produce the long-term expected rateof return by weighting the expected future real rates of return by the target asset allocation percentage andby adding expected inflation. Best estimates of arithmetic real rates of return for each major asset classincluded in PERS's target asset allocation as of June 30, 2017 are summarized in the following table:

Asset ClassTarget

Allocation

Long-TermExpected RealRate of Return

Absolute return/risk mitigation 5.00% 5.51%Cash equivalents 5.50% 1.00%U.S. Treasuries 3.00% 1.87%Investment grade credit 10.00% 3.78%Public high yield 2.50% 6.82%Global diversified credit 5.00% 7.10%Credit oriented hedge funds 1.00% 6.60%Debt related private equity 2.00% 10.63%Debt related real estate 1.00% 6.61%Private real asset 2.50% 11.83%Equity related real estate 6.25% 9.23%U.S. equity 30.00% 8.19%Non-U.S. developed markets equity 11.50% 9.00%Emerging markets equity 6.50% 11.64%Buyouts/venture capital 8.25% 13.08%

Discount Rate

The discount rate used to measure the total pension liability was 5.00% as of June 30, 2017. This singleblended discount rate was based on the long-term expected rate of return on pension plan investments of7.00% and a municipal bond rate of 3.58% as of June 30, 2017 based on the Bond Buyer GO 20-BondMunicipal Bond Index, which includes tax-exempt general obligation municipal bonds with an averagerating of AA/Aa or higher. The projection of cash flows used to determine the discount rate assumed thatcontributions from plan members will be made at the current member contribution rates and thatcontributions from employers will be made based on the contribution rate in the most recent fiscal year. TheState employer contributed 40% of the actuarially determined contributions and the local employerscontributed 100% of their actuarially determined contributions. Based on those assumptions, the plan'sfiduciary net position was projected to be available to make projected future benefit payments of current planmembers through 2040. Therefore, the long-term expected rate of return on plan investments was appliedto projected benefit payments through 2040 and the municipal bond rate was applied to projected benefitpayments after that date in determining the total pension liability.

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Sensitivity of the Collective Net Pension Liability to Changes in the Discount Rate

The following presents the collective net pension liability of the participating employers as of June 30,2017, respectively, calculated using the discount rate as disclosed above as well as what the collectivenet pension liability would be if it was calculated using a discount rate that is 1 -percentage point loweror 1- percentage-point higher than the current rate:

June 30, 2017 1%

Decrease4.00%

At CurrentDiscount Rate

5.00%

1%Increase6.00%

District's proportionate share of the pension liability $2,987,284 $3,736,080 $4,634,861

Pension Plan Fiduciary Net Position

Detailed information about the pension plan’s fiduciary net position is available in the separately issuedFinancial Report for the State of New Jersey Public Employees Retirement System (PERS).

Teachers Pensions and Annuity Fund (TPAF)

The employer contributions for local participating employers are legally required to be funded by the Statein accordance with N.J.S.A 18:66-33. Therefore, these local participating employers are considered to bein a special funding situation as defined by GASB Statement No. 68 and the State is treated as anonemployer contributing entity. Since the local participating employers do not contribute directly to theplan (except for employer specific financed amounts), there is no net pension liability or deferred outflowsor inflows to report in the financial statements of the local participating employers. However, the notes tothe financial statements of the local participating employers must disclose the portion of the nonemployercontributing entities' total proportionate share of the net pension liability that is associated with the localparticipating employer.

The portion of the TPAF Net Pension Liability that was associated with the District recognized at June 30,2018 was as follows:

Net Pension Liability:District's proportionate share $ -0- State's proportionate share

associated with the District 49,533,608$49,533,608

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The net pension liability was measured as of June 30, 2017, and the total pension liability used to calculatethe net pension liability was determined by an actuarial valuation as of June 30, 2016 rolled forward toJune 30, 2017. The net pension liability associated with the District was based on a projection of theDistrict's long-term share of contributions to the pension plan relative to the projected contributions of allparticipating school districts and the State, actuarially determined. At June 30, 2017, the proportion of theTPAF net pension liability associated with the District was 0.0734662699%.

For the year ended June 30, 2018, the District recognized on-behalf pension expense and revenue of$3,431,438 for contributions provided by the State in the District-Wide Financial Statements.

Actuarial Assumptions

The total pension liability for the June 30, 2017 measurement date was determined by an actuarial valuationas of July 1, 2016, which was rolled forward to June 30, 2017. This actuarial valuation used the followingactuarial assumptions, applied to all periods in the measurement:

Inflation rate 2.25%Salary Increases: 2012-2021 Varies based on experience Thereafter Varies based on experience

Investment Rate of Return 7.00%

Mortality Rates

Pre-retirement, post-retirement and disabled mortality rates were based on the experience of TPAF membersreflecting mortality improvement on a generational basis based on a 60-year average of Social Security datafrom 1953 to 2013.

The actuarial assumptions used in the July 1, 2016 valuation were based on the results of an actuarialexperience study for the period July 1, 2012 to June 30, 2015.

Long-Term Expected Rate of Return

In accordance with State statute, the long-term expected rate of return on plan investments (7.00% atJune 30, 2017) is determined by the State Treasurer, after consultation with the Directors of the Division ofInvestments and Division of Pensions and Benefits, the board of trustees and the actuaries. The long-termexpected rate of return was determined using a building block method in which best-estimate ranges of

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expected future real rates of return (expected returns, net of pension plan investment expense and inflation)are developed for each major asset class. These ranges are combined to produce the long-term expected rateof return by weighting the expected future real rates of return by the target asset allocation percentage andby adding expected inflation. Best estimates of arithmetic real rates of return for each major asset classincluded in TPAF's target asset allocation as of June 30, 2017 are summarized in the following table:

Asset ClassTarget

Allocation

Long-TermExpected RealRate of Return

Absolute return/risk mitigation 5.00% 5.51%Cash equivalents 5.50% 1.00%U.S. Treasuries 3.00% 1.87%Investment grade credit 10.00% 3.78%Public high yield 2.50% 6.82%Global diversified credit 5.00% 7.10%Credit oriented hedge funds 1.00% 6.60%Debt related private equity 2.00% 10.63%Debt related real estate 1.00% 6.61%Private real asset 2.50% 11.83%Equity related real estate 6.25% 9.23%U.S. equity 30.00% 8.19%Non-U.S. developed markets equity 11.50% 9.00%Emerging markets equity 6.50% 11.64%Buyouts/venture capital 8.25% 13.08%

Discount Rate

The discount rate used to measure the total pension liability was 4.25% and 3.22% as of June 30, 2017 and2016, respectively. This single blended discount rate was based on the long-term expected rate of return onpension plan investments of 7.00%, and a municipal bond rate of 3.58% and 2.85% as of June 30, 2017 and2016, respectively, based on the Bond Buyer Go 20-Bond Municipal Bond Index which includes tax-exemptgeneral obligation municipal bonds with an average rating of AA/Aa or higher. The projection of cash flowsused to determine the discount rate assumed that contributions from plan members will be made at thecurrent member contribution rates and that contributions from employers will be made based on thecontribution rate in the most recent fiscal year. The State contributed 40% of the actuary determinedcontributions. Based on those assumptions, the plan's fiduciary net position was projected to be availableto make projected future benefit payments of current plan members through 2036. Therefore, the long-termexpected rate of return on plan investments was applied to projected benefit payments through 2036, andthe municipal bond rate was applied to projected benefit payments after that date in determining the totalpension liability.

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Sensitivity of the Net Pension Liability to Changes in the Discount Rate

Because the District's proportionate share of the net pension liability is zero, consideration of potentialchanges in the discount rate is not applicable to the District.

NOTE 9. POST-RETIREMENT BENEFITS:

General Information about the OPEB Plan

Plan Description and Benefits Provided

Chapter 384 of Public Laws 1987 and Chapter 6 of Public Laws 1990 required Teachers’ Pension andAnnuity Fund (TPAF) and the Public Employees’ Retirement System (PERS), respectively, to fund post-retirement medical benefits for those State employees who retire after accumulating 25 years of creditedservice or on a disability retirement. P.L. 2007, c.103 amended the law to eliminate the funding of post-retirement medical benefits through the TPAF and PERS. It created separate funds outside of the pensionplans for the funding and payment of post-retirement medical benefits for retired State employees and retirededucational employees. The cost of these benefits is funded through contributions by the State in accordancewith P.L. 1994 Chapter 62. Funding of post-retirement medical premiums changed from a prefunding basisto a pay-as-you-go basis beginning in fiscal year 1994.

The State is also responsible for the cost attributable to P.L. 1992 Chapter 126, which provides employerpaid health benefits to members of PERS and the Alternate Benefit Program who retired from a board ofeducation or county college with 25 years of service.

The School Employees Health Benefits Program (SEHBP) Act is found in New Jersey Statutes Annotated,Title 52, Article 17.25 et. seq. Rules governing the operation and administration of the program are foundin Title 17, Chapter 9 of the New Jersey Administrative Code.

No assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB No. 75.

Employees covered by benefits terms. At June 30, 2017, the following employees were covered by thebenefit terms:

TPAF participant retirees:

As of June 30, 2017, there were 112,966 retirees receiving post-retirement medicalbenefits, and the State Contributed $1.39 billion on their behalf.

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NOTE 9. POST-RETIREMENT BENEFITS: (continued)

PERS participant retirees:

The State paid $238.9 million toward Chapter 126 benefits for 209,913 eligible retiredmembers in Fiscal Year 2017.

Total OPEB Liability

The State, a nonemployer contributing entity, is the only entity that has a legal obligation to make employercontributions to OPEB for qualified retired PERS and TPAF participants. The LEA's proportionate sharepercentage determined under paragraphs 193 and 203 through 205 of GASB No. 75 is zero percent. Accordingly, the LEA did not recognize any portion of the collective OPEB liability on the Statement of NetPosition. Accordingly, the following OPEB liability note information is reported at the State's level for theState Health Benefit Local Education Retired Employee's Plan and is not specific to the board ofeducation/board of trustees, and could be found at https://www.state.nj.us/treasury/pensions/GASBnoticesOPEB.

The portion of the OPEB Liability that was associated with the District recognized at June 30, 2018 was asfollows:

OPEB Liability:District's proportionate share $ -0- State's proportionate share

associated with the District 31,486,293

$31,486,293

Actual Assumptions and Other Imputes

The total OPEB liability in the June 30, 2017 actuarial valuation reported by the State in the State's Reportof Total Nonemployer OPEB Liability for the State Health Benefit Local Education Retired Employee's Planwas determined using the following actuarial assumptions and other inputs, applied to all periods includedin the measurement, unless otherwise specified:

Total Nonemployer OPEB Liability

The total nonemployer OPEB liability as of June 30, 2017 was determined by an actuarial valuation as ofJune 30, 2016, which was rolled forward to June 30, 2017. The total nonemployer OPEB liability as ofJune 30, 2016 was determined by an actuarial valuation as of June 30, 2016. The actuarial assumptions varyfor each plan member depending on the pension plan the member is enrolled in. This actuarial valuationused the following actuarial assumptions, applied to all periods in the measurement:

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Inflation rate 2.50%

TPAF/ABP PERS Salary increases: Through 2026 1.55 - 4.55%

based on yearsof service

2.15 - 4.15%based on age

Thereafter 2.00 - 5.45%based on years

of service

3.15 - 5.15%based on age

Preretirement mortality rates were based on the RP-2014 Headcount-Weighted Health EmployeeMale/Female mortality table with fully generational mortality improvement projections from the central yearusing the MP-2017 scale. Postretirement mortality rates were based on the RP-2014 Headcount-WeightedHealth Annuitant Male/Female mortality table with fully generational improvement projections from thecentral year using the MP-2017 scale. Disability mortality was based on the RP-2014 Headcount-WeightedDisabled Male/Female mortality table with fully generational improvement projections from the central yearusing the MP-2017 scale.

The actuarial assumptions used in the June 30, 2016 valuation were based on the results of actuarialexperience studies for the periods July 1, 2012 – June 30, 2015, July 1, 2010 – June 30, 2013, and July 1,2011 – June 30, 2014 for TPAF and PFRS, respectively.

(a) Health Care Trend Assumptions

For pre-Medicare preferred provider organization (PPO) medical benefits, this amount initially is 5.9%and decreases to a 5.0% long-term trend rate after nine years. For self-insured post-65 PPO medicalbenefits, the trend rate is 4.5%. For health maintenance organization (HMO) medical benefits, thetrend rate is initially 5.9% and decreases to a 5.0% long-term trend rate after nine years. Forprescription drug benefits, the initial trend rate is 10.5% decreasing to a 5.0% long-term trend rate aftereight years. For the Medicare Part B reimbursement, the trend rate is 5.0%. The Medicare Advantagetrend rate is 4.5% and will continue in all future years.

(b) Discount Rate

The discount rate for June 30, 2017 and 2016 was 3.58% and 2.85%, respectively. This representsthe municipal bond return rate as chosen by the Division. The source is the Bond Buyer Go 20-BondMunicipal Bond Index, which includes tax-exempt general obligation municipal bonds with anaverage rating of AA/Aa or higher.

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Sensitivity of Total Nonemployer OPEB Liability to Changes in the Discount Rate

Because the District's proportionate share of the OPEB liability is zero, consideration of potential changesin the discount rate is not applicable to the District.

Sensitivity of the Total Nonemployer OPEB Liability to Changes in the Healthcare Cost Trend Rates:

Because the District's proportionate share of the OPEB liability is zero, consideration of potential changesin the healthcare cost trend rates is not applicable to the District.

OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB:

For the year ended June 30, 2018, the board of education/board of trustees recognized on-behalf OPEBexpense of $2,349,211 in the district-wide financial statements as determined by the State as the total OPEBliability for benefits provided through a defined benefit OPEB plan that is not administered through a trustthat meets the criteria in paragraph 4 of GASB No. 75 and in which there is a special funding situation.

In accordance with GASB No. 75, the Borough of Haledon School District proportionate share of schoolretirees OPEB is zero; therefore, there is no recognition of the allocation of proportionate share of deferredoutflows of resources and deferred inflows of resources.

NOTE 10. DEFERRED COMPENSATION

The Board offers its employees a choice of various deferred compensation plans created in accordance withInternal Revenue Code Section 403(b). The plans, which are administered by CPI Qualified PlanConsultants, Inc., permits participants to defer a portion of their salary until future years. Amounts deferredunder the plans are not available to employees until termination, retirement, death or unforeseeableemergency. The plan participants are as follows:

Equitable Lincoln Investment Planning VALIC

NOTE 11. RISK MANAGEMENT

The District is exposed to various risks of loss related to general liability, automobile coverage; theft of,damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. TheBoard has obtained insurance coverage to guard against these events to minimize the exposure to the Districtshould they occur.

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NOTE 11. RISK MANAGEMENT, (continued)

Property and Liability Insurance - The District is currently a member of the Suburban Essex JointInsurance Fund (the “Fund”). The Fund provides it’s members with General Liability, Auto Liability,Property, Employee Benefits Liability, Worker’s Compensation and Employer Liability Insurance. TheFund is a risk-sharing public entity risk pool that is both an insured and self-administered group of SchoolDistrict’s established for the purpose of providing low-cost insurance coverage for their respective membersin order to keep insurance costs at a minimum. Each member appoints an official to represent theirrespective entity for the purpose of creating a governing body from which officers for the Funds are elected.

As a member of the Fund, the District could be subject to supplemental assessments in the event ofdeficiencies. If the assets of the Funds were to be exhausted, members would become responsible for theirrespective shares of the Fund’s liabilities. However, this Fund has fully reinsured the exposures above alllimits subscribed to by its members. The Funds can declare and distribute dividends to members upon arrivalof the State of New Jersey Department of Insurance. These distributions are divided among the membersin the same ratio as their individual assessment related to the total assessment of the membership body.

Financial statements for the Funds are available at the office of the Fund’s administrator, PERMA, 9Campus Drive, Suite 16, Parsippany, NJ 07054.

There has been no significant reduction in insurance coverage from the previous year nor have there beenany settlements in excess of insurance coverages.

New Jersey Unemployment Compensation Insurance - The District has elected to fund its New JerseyUnemployment Compensation Insurance under the "Benefit Reimbursement Method". Under this plan, theDistrict is required to reimburse the New Jersey Unemployment Trust Fund for benefits paid to its formeremployees and charged to its account with the State. The District is billed quarterly for amounts due to theState. The following is a summary of District contributions, employee contributions, reimbursements to theState for benefits paid and the ending balance of the District's expendable trust fund for the current and prioryear:

Fiscal Year

DistrictContributions/

InterestEarnings

EmployeeContributions

AmountReimbursed

EndingBalance

2017-2018 $359.10 $24,429.61 $32,231.65 $328,545.502016-2017 199.00 26,876.03 23,550.01 335,988.442015-2016 133.69 22,592.05 20,338.17 332,463.42

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NOTE 12. FUND BALANCE APPROPRIATED

General Fund [Exhibit B-1] - Of the $979,236.69 General Fund fund balance at June 30, 2018, $15,718.78is reserved for encumbrances; $0.00 is reserved as excess surplus in accordance with N.J.S.A. 18A:7F-7;($0.00 of the total reserve for excess surplus has been appropriated and included as anticipated revenue forthe year ended June 30, 2019); $490,885.24 has been reserved in the Capital Reserve Account; $265,613.95has been reserved in the Maintenance Reserve Account; $225,036.99 has been reserved in the EmergencyReserve Account; $356,550.00 has been appropriated and included as anticipated revenue for the year endedJune 30, 2019; and $(374,568.27) is unreserved and undesignated.

NOTE 13. CALCULATION OF EXCESS SURPLUS

In accordance with N.J.S.A. 18A:7F-7 as amended, the designation for Reserved Fund Balance -- ExcessSurplus is a required calculation pursuant to the New Jersey Comprehensive Educational Improvement andFinancing Act of 1996 (CEIFA). New Jersey school districts are required to reserve General Fund fundbalance at the fiscal year end of June 30 if they did not appropriate a required minimum amount as budgetedfund balance in their subsequent years' budget. There was no excess fund balance at June 30, 2018.

NOTE 14. CAPITAL RESERVE ACCOUNT

A capital reserve account was established by the Borough of Haledon School District by inclusion of $1.00on October 3, 2000 for the accumulation of funds for use as capital outlay expenditures in subsequent fiscalyears. The capital reserve account is maintained in the general fund and its activity is included in the generalfund annual budget.

Funds placed in the capital reserve account are restricted to capital projects in the district’s approved LongRange Facilities Plan (LRFP). A district may increase the balance in the capital reserve by appropriatingfunds in the annual general fund budget certified for taxes or by transfer by board resolution at year end ofany unanticipated revenue or unexpended line-item appropriation amounts, or both. A district may alsoappropriate additional amounts when the express approval of the voters has been obtained either by aseparate proposal at budget time or by a special question at one of the four special elections authorizedpursuant to N.J.S.A. 19:60-2. Pursuant to N.J.A.C. 6A:23A-14.1(g), the balance in the account cannot at anytime exceed the local support costs of uncompleted capital projects in its approved LRFP.

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NOTE 14. CAPITAL RESERVE ACCOUNT, (continued)

The activity of the capital reserve for the July 1, 2017 to June 30, 2018 fiscal year is as follows:

Beginning balance, July 1, 2017 $1,081,111.56

Interest Earnings $179.00Deposits - Board resolution - June 12, 2018 186,293.47

186,472.471,267,584.03

Withdrawals: Budgeted Withdrawal 776,698.79

Ending balance, June 30, 2018 $490,885.24

The balance in the capital reserve account at June 30, 2018 does not exceed the balance of local supportcosts of uncompleted capital projects in its LFRP.

NOTE 15. MAINTENANCE RESERVE ACCOUNT

A maintenance reserve account was established by Board of Education resolution adopted June 24, 2008. The account is maintained in the general fund. The maintenance reserve account is used to accumulatedfunds for the required maintenance of a facility in accordance with the EFCRA (N.J.S.A. 18A:7G-9). EFCFA requires that upon district completion of a school facilities project, the district must submit a planfor the maintenance of that facility. All such plans must include a provision for a maintenance reserve fund.

The activity of the maintenance reserve for the July 1, 2017 to June 30, 2018 fiscal years is as follows:

Beginning balance, July 1, 2017 $315,567.95

Interest Earnings 46.00 315,613.95

Withdrawals: Budgeted Withdrawal 50,000.00


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NOTE 16. EMERGENCY RESERVE ACCOUNT

The emergency reserve is used to accumulate funds in accordance with N.J.S.A. 18A:7F-41c(1) to financeunanticipated general fund expenditures required for a thorough and efficient education. Unanticipatedmeans reasonably unforeseeable and shall not include additional costs caused by poor planning. Themaximum balance permitted at any time in this reserve is the greater of $250,000 or 1% of the general fundbudget not to exceed one million dollars. Deposits may be made to the emergency reserve account by boardresolution at year end of any unanticipated revenue or unexpended line item appropriation or both. Withdrawals from the reserve require the approval of the commissioner unless the withdrawal is necessaryto meet an increase in total health care costs in excess of four percent.

Beginning balance, July 1, 2017 $225,017.40

Interest Earnings 19.59


NOTE 17. INVENTORY

Inventory in the Food Service Fund at June 30, 2018 consisted of the following:

Food $3,739.95Supplies 996.57

$4,736.52

The United States Department of Agriculture (USDA) commodity portion of the Food Service Fundinventory consists of food donated by USDA. It is valued at estimated market prices by USDA. The amountof unused commodities at year end is reported on Schedule A as deferred revenue.

NOTE 18. DEFICIT IN UNASSIGNED FUND BALANCES

The District has a deficit fund balance of $374,568.27 in the General Fund as of June 30, 2018 as reportedin the fund statements (modified accrual basis). N.J.S.A. 18A:22-44.2 provides that in the event a stateschool aid payment is not made until the following school budget year, districts must record the delayed oneor more June state aid payments as revenue, for budget purposes only, in the current school budget year. The bill provides legal authority for school districts to recognize this revenue in the current budget year. For

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NOTE 18. DEFICIT IN UNASSIGNED FUND BALANCES, (continued)

intergovernmental transactions, GASB Statement No. 33 requires that recognition (revenue, expenditure,asset, liability) should be in symmetry, i.e., if one government recognizes an asset, the other governmentrecognizes a liability. Since the State is recording the June state aid payment(s) in the subsequent fiscal year,the school district cannot recognize the June state aid payment(s) (on the GAAP financial statements) untilthe year the State records the payable. Due to the timing difference of recording the June state aidpayment(s), the General Fund balance deficit does not alone indicate that the District is facing financialdifficulties.

Pursuant to N.J.S.A. 18A:22-44.2 any negative unreserved, undesignated general fund balance that isreported as a direct result from a delay in the June payment(s) of state aid until the following fiscal year, isnot considered in violation of New Jersey statute and regulation nor in need of corrective action. TheDistrict deficit in the GAAP funds statements of $374,568.27 is less than the last state aid payment of$707,163.00.

NOTE 19. CONTINGENT LIABILITIES

Grant Programs - The school district participates in federally assisted grant programs. These programs aresubject to program compliance audits by the grantors or their representatives. The school district ispotentially liable for expenditures which may be disallowed pursuant to the terms of these grant programs. Management is not aware of any material items of noncompliance which would result in the disallowanceof program expenditures.

Litigation - The District is a party defendant in some lawsuits, none of a kind unusual for a school districtof its size and scope of operation. In the opinion of the Board's Attorney the potential claims against theDistrict not covered by insurance policies would not materially affect the financial condition of the District.

NOTE 20. SUBSEQUENT EVENTS

The Board has evaluated subsequent events through January 22, 2019, the date which the financial statementswere available to be issued and no other items were noted for disclosure.

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INFORMATION - PART II

BUDGETARY COMPARISON SCHEDULES

Exhibit C-1


Budgetary Comparison Schedule

General Fund


Budget

Original Transfers/ Final Variance

Budget Adjustments Budget Actual Final to Actual

REVENUES:

Local Sources:

Local Tax Levy 6,456,600.00 6,456,600.00 6,456,600.00

Tuition from Other LEAs Within the State 50,000.00 50,000.00 3,808.50 (46,191.50)

Interest Earned on Emergency Reserve Funds 65.00 65.00 19.59 (45.41)

Interest Earned on Maintenance Reserve Funds 90.00 90.00 46.00 (44.00)

Interest Earned on Capital Reserve Funds 270.00 270.00 179.00 (91.00)

Interest on Investments 583.35 583.35

Miscellaneous 72,650.00 72,650.00 122,837.71 50,187.71

Total - Local Sources 6,579,675.00 6,579,675.00 6,584,074.15 4,399.15

State Sources:

Categorical Special Education Aid 600,886.00 600,886.00 600,886.00

Equalization Aid 5,977,868.00 5,977,868.00 6,313,556.00 335,688.00

Categorical Security Aid 114,210.00 114,210.00 114,210.00

Categorical Transportation Aid 10,669.00 10,669.00 10,669.00

Under Adequacy Aid 135,963.00 135,963.00 135,963.00

Per Pupil Growth Aid 9,830.00 9,830.00 9,830.00

PARCC Readiness 9,830.00 9,830.00 9,830.00

Professional Learning Community Aid 10,230.00 10,230.00 10,230.00

Extraordinary Aid 28,826.00 28,826.00

Other State Aid - Reimburse Nonpublic School Transportation 13,340.00 13,340.00

Lead Testing 1,411.75 1,411.75

On-behalf Teachers Pension and Annuity Fund (non-budgeted) 1,065,654.00 1,065,654.00

On-behalf TPAF NCGI Premium (non-budgeted) 25,861.00 25,861.00

On-behalf TPAF Post Retirement Medical (non-budgeted) 704,986.00 704,986.00

On-behalf TPAF - LTDI 1,848.00 1,848.00

TPAF Social Security (Reimbursed - Non-Budgeted) 559,442.83 559,442.83

Total - State Sources 6,869,486.00 6,869,486.00 9,606,543.58 2,737,057.58

Federal Sources:

Medicaid Reimbursement 22,762.00 22,762.00 22,149.28 (612.72)

Total - Federal Sources 22,762.00 22,762.00 22,149.28 (612.72)

TOTAL REVENUES 13,471,923.00 13,471,923.00 16,212,767.01 2,740,844.01

EXPENDITURES:

Current Expense:

Regular Programs - Instruction

Kindergarten - Salaries of Teachers 470,285.00 32,155.00 502,440.00 502,439.44 0.56

Grades 1-5 - Salaries of Teachers 2,200,372.00 66,323.00 2,266,695.00 2,261,591.85 5,103.15

Grades 6-8 - Salaries of Teachers 1,484,803.00 36,807.41 1,521,610.41 1,516,809.38 4,801.03

Regular Programs - Home Instruction:

Salaries of Teachers 8,000.00 2,553.00 10,553.00 10,552.50 0.50

Purchased Professional-Educational Services 500.00 (500.00)

Regular Programs - Undistributed Instruction

Purchased Professional-Educational Services 5,000.00 7,910.00 12,910.00 12,909.96 0.04

Purchased Technical Services 3,695.00 3,695.00 3,690.00 5.00

Other Purchased Services (400-500 series) 31,205.00 (145.00) 31,060.00 31,028.30 31.70

General Supplies 142,439.48 (47,231.00) 95,208.48 92,931.86 2,276.62

Textbooks 31,000.00 (20,290.00) 10,710.00 10,708.74 1.26

Other Objects 8,676.00 9,640.00 18,316.00 18,273.81 42.19

TOTAL REGULAR PROGRAMS - INSTRUCTION 4,382,280.48 90,917.41 4,473,197.89 4,460,935.84 12,262.05

SPECIAL EDUCATION - INSTRUCTION

Learning and/or Language Disabilities:


Other Salaries for Instruction 90,606.00 (16,500.00) 74,106.00 73,959.60 146.40

Purchased Professional-Educational Services 15,000.00 36,349.00 51,349.00 51,268.53 80.47

General Supplies 1,500.00 (973.41) 526.59 440.03 86.56

Textbooks 1,000.00 (1,000.00)

Total Learning and/or Language Disabilities 384,253.00 20,769.59 405,022.59 404,709.14 313.45

Behavioral Disabilities:

Salaries of Teachers 141,635.00 2,710.00 144,345.00 144,345.00

Purchased Professional-Educational Services 15,000.00 510.00 15,510.00 14,659.75 850.25

General Supplies 1,887.55 (1,000.00) 887.55 739.02 148.53

Textbooks 800.00 (800.00)

Total Behavioral Disabilities 159,322.55 1,420.00 160,742.55 159,743.77 998.78

Resource Room/Resource Center:

Salaries of Teachers 655,557.00 (33,500.00) 622,057.00 622,052.70 4.30

Other Salaries for Instruction 16,765.00 3,219.00 19,984.00 19,983.60 0.40

General Supplies 3,750.00 (1,535.00) 2,215.00 2,161.67 53.33

Textbooks 1,000.00 (1,000.00)

Total Resource Room/Resource Center 677,072.00 (32,816.00) 644,256.00 644,197.97 58.03

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Exhibit C-1



General Fund


Budget



Autism:


Other Salaries for Instruction 99,303.00 (49,300.00) 50,003.00 48,495.00 1,508.00

Purchased Professional-Educational Services 30,000.00 22,200.00 52,200.00 27,803.48 24,396.52


Textbooks 1,000.00 (1,000.00)

Total Autism 266,640.00 (33,500.00) 233,140.00 207,025.68 26,114.32

Preschool Disabilities - Full-Time:


Other Salaries for Instruction 35,878.00 (8,878.00) 27,000.00 26,964.97 35.03

Purchased Professional-Educational Services 15,000.00 6,200.00 21,200.00 19,540.41 1,659.59


Total Preschool Disabilities - Full-Time 148,700.00 (44,278.00) 104,422.00 101,859.37 2,562.63

Home Instruction:

Salaries of Teachers 8,000.00 (4,000.00) 4,000.00 2,970.00 1,030.00

Purchased Professional-Educational Services 1,000.00 (1,000.00)

Total Home Instruction 9,000.00 (5,000.00) 4,000.00 2,970.00 1,030.00

TOTAL SPECIAL EDUCATION - INSTRUCTION 1,644,987.55 (93,404.41) 1,551,583.14 1,520,505.93 31,077.21

Basic Skills/Remedial - Instruction


Textbooks 1,300.00 (1,250.00) 50.00 50.00

Total Basic Skills/Remedial - Instruction 311,729.00 17,600.00 329,329.00 328,419.35 909.65

Bilingual Education - Instruction


General Supplies 1,000.00 1,000.00 796.37 203.63

Textbooks 500.00 (500.00)

Total Bilingual Education - Instruction 234,841.00 (24,800.00) 210,041.00 209,241.37 799.63

School-Sponsored Cocurricular Activities - Instruction

Salaries 59,303.00 59,303.00 58,534.61 768.39

Purchased Services (300-500 series) 6,000.00 (5,808.00) 192.00 192.00

Supplies and Materials 4,790.00 4,790.00 4,660.65 129.35

Other Objects 1,189.00 1,189.00 1,189.00

Total School-Sponsored Cocurricular Activities - Instruction 65,303.00 171.00 65,474.00 64,384.26 1,089.74

School-Sponsored Athletics - Instruction

Salaries 20,000.00 20,000.00 18,900.00 1,100.00

Purchased Services (300-500 series) 7,000.00 (2,150.00) 4,850.00 4,850.00

Supplies and Materials 7,087.00 1,746.00 8,833.00 8,643.33 189.67

Total Other Instructional Programs - Instruction 34,087.00 (404.00) 33,683.00 32,393.33 1,289.67

TOTAL INSTRUCTION 6,673,228.03 (9,920.00) 6,663,308.03 6,615,880.08 47,427.95

Undistributed Expenditures - Instruction:

Tuition to Other LEAs Within the State - Regular 8,161.00 8,161.00 8,148.71 12.29

Tuition to Private Schools for the Disabled - Within State 234,764.00 5,678.85 240,442.85 240,419.85 23.00

Total Undistributed Expenditures - Instruction: 234,764.00 13,839.85 248,603.85 248,568.56 35.29

Undistributed Expend. - Attend. & Social Work

Salaries 48,480.00 290.00 48,770.00 48,768.36 1.64

Supplies and Materials 1,345.00 (350.00) 995.00 991.66 3.34

Total Undistributed Expend. - Attend. & Social Work 49,825.00 (60.00) 49,765.00 49,760.02 4.98

Undist. Expend. - Health Services

Salaries 124,016.00 (50,441.00) 73,575.00 73,574.40 0.60

Purchased Professional and Technical Services 16,783.00 (1,716.85) 15,066.15 13,863.85 1,202.30

Other Purchased Services (400-500 series) 150.00 150.00 150.00

Supplies and Materials 5,000.00 (500.00) 4,500.00 4,443.10 56.90

Other Objects 800.00 (700.00) 100.00 85.00 15.00

Total Undistributed Expenditures - Health Services 146,599.00 (53,207.85) 93,391.15 92,116.35 1,274.80

Undist. Expend. - Speech, OT, PT, & Related Services

Salaries 333,252.00 (73,194.00) 260,058.00 259,868.88 189.12

Purchased Professional - Educational Services 62,979.20 46,416.00 109,395.20 109,390.25 4.95

Supplies and Materials 5,000.00 (1,600.00) 3,400.00 3,388.00 12.00

Total Undist. Expend. - Speech, OT, PT, & Related Services 401,231.20 (28,378.00) 372,853.20 372,647.13 206.07

Undist. Expenditures - Guidance

Salaries of Other Professional Staff 186,110.00 (18,734.00) 167,376.00 167,364.54 11.46

Other Purchased Prof. and Tech. Services 5,000.00 (4,300.00) 700.00 700.00


Total Undist. Expenditures - Guidance 221,110.00 (48,034.00) 173,076.00 173,042.29 33.71

Undist. Expend. - Child Study Team

Salaries of Other Professional Staff 464,018.00 (6,722.00) 457,296.00 456,719.48 576.52

Salaries of Secretarial and Clerical Assistants 54,920.00 1,610.00 56,530.00 56,529.12 0.88

Purchased Professional - Educational Services 430.00 11,590.00 12,020.00 12,020.00

Other Purchased Prof. and Tech. Services 10,000.00 (6,972.00) 3,028.00 2,995.00 33.00

Misc Pur Serv (400-500 series O/than Resid Costs) 482.00 482.00 481.75 0.25


Other Objects 150.00 150.00 150.00

Total Undist. Expend. - Child Study Team 533,518.00 (12.00) 533,506.00 520,832.70 12,673.30

-71-

Exhibit C-1



General Fund


Budget



Undist. Expend. - Improvement of Instructional Services

Salaries of Other Professional Staff 5,000.00 (4,993.00) 7.00 7.00

Supplies and Materials 130.00 (110.00) 20.00 20.00

Total Undist. Expend. - Improvement of Inst. Services 5,130.00 (5,103.00) 27.00 27.00

Undist. Expend. - Educational Media Serv./Sch. Library

Salaries 89,468.00 (1,600.00) 87,868.00 87,785.00 83.00


Total Undist. Expend. - Educational Media Serv./Sch. Library 106,789.79 (3,990.00) 102,799.79 102,680.38 119.41

Undist. Expend. - Instructional Staff Training Serv.

Purchased Professional - Educational Services 4,200.00 4,200.00 4,200.00

Other Purchased Services (400-500 series) 10,000.00 100.00 10,100.00 9,144.75 955.25

Total Undist. Expend. - Instructional Staff Training Serv. 10,000.00 4,300.00 14,300.00 9,144.75 5,155.25

Undist. Expend. - Supp. Serv. - General Administration

Salaries 61,495.00 2,035.00 63,530.00 63,528.13 1.87

Legal Services 25,000.00 (5,950.00) 19,050.00 16,715.75 2,334.25

Audit Fees 20,500.00 3,000.00 23,500.00 23,390.00 110.00

Other Purchased Professional Services 123,287.60 (1,867.00) 121,420.60 118,653.08 2,767.52

Communications/Telephone 70,000.00 (10,942.00) 59,058.00 52,018.49 7,039.51

BOE Other Purchased Services 3,500.00 1,668.00 5,168.00 5,125.70 42.30

Other Purchased Services (400-500 series) 38,000.00 761.00 38,761.00 36,601.92 2,159.08

General Supplies 500.00 (477.00) 23.00 23.00

Miscellaneous Expenditures 2,000.00 2,303.00 4,303.00 4,293.79 9.21

BOE Membership Dues and Fees 6,400.00 935.00 7,335.00 7,202.95 132.05

Total Undist. Expend. - Supp. Serv. - General Administration 350,682.60 (8,534.00) 342,148.60 327,529.81 14,618.79

Undist. Expend. - Support Serv. - School Administration

Salaries of Principals/Assistant Principals 337,740.00 5,520.00 343,260.00 343,257.84 2.16

Salaries of Secretarial and Clerical Assistants 119,466.00 9,558.00 129,024.00 129,022.92 1.08

Other Purchased Services (400-500 series) 9,000.00 (6,694.00) 2,306.00 2,275.00 31.00


Other Objects 10,000.00 (4,000.00) 6,000.00 5,763.64 236.36

Total Undist. Expend. - Support Serv. - School Administration 491,272.29 4,384.00 495,656.29 494,740.79 915.50

Undist. Expend. - Central Services

Salaries 52,425.00 129.00 52,554.00 52,553.04 0.96

Purchased Professional Services 195,500.00 (1,540.00) 193,960.00 193,939.00 21.00

Purchased Technical Services 200.00 200.00 134.78 65.22

Misc. Purchased Services (400-500 series) 6,200.00 (6,188.57) 11.43 11.43

Supplies and Materials 6,800.00 950.00 7,750.00 7,733.99 16.01

Miscellaneous Expenditures 495.00 (110.00) 385.00 175.00 210.00

Total Undist. Expend. - Central Services 261,620.00 (6,759.57) 254,860.43 254,535.81 324.62

Undist. Expend. - Admin. Info. Tech

Purchased Technical Services 186,645.00 2,596.00 189,241.00 189,241.00

Other Purchased Services (400-500 series) 1,500.00 600.00 2,100.00 1,921.00 179.00

Supplies and Materials 40,000.00 (1,304.00) 38,696.00 36,875.83 1,820.17

Total Undist. Expend. - Admin. Info. Tech 228,145.00 1,892.00 230,037.00 228,037.83 1,999.17

Undist. Expend. - Required Maint. for School Facilities

Salaries 74,678.00 18,273.00 92,951.00 91,433.51 1,517.49

Cleaning, Repair and Maintenance Services 100,840.00 (24,038.00) 76,802.00 73,701.61 3,100.39

General Supplies 26,351.55 (9,308.00) 17,043.55 15,623.95 1,419.60

Undist. Expend. - Required Maint. for School Facilities 201,869.55 (15,073.00) 186,796.55 180,759.07 6,037.48

Undist. Expend. - Custodial Services

Salaries 217,943.00 5,413.00 223,356.00 222,625.69 730.31

Cleaning, Repair and Maintenance Services 66,410.00 (222.00) 66,188.00 66,081.94 106.06

Other Purchased Property Services 7,500.00 15,913.00 23,413.00 8,014.82 15,398.18

Insurance 74,312.00 27.50 74,339.50 74,290.58 48.92


Energy (Energy and Electricity) 124,192.00 (23,776.00) 100,416.00 97,517.98 2,898.02

Other Objects 1,500.00 (1,053.00) 447.00 374.00 73.00

Energy (Natural Gas) 38,000.00 (3,689.00) 34,311.00 34,310.23 0.77

Total Undist. Expend. - Custodial Services 577,357.00 (10,552.00) 566,805.00 547,451.86 19,353.14

Undist. Expend. - Security

Salaries 43,050.00 105.00 43,155.00 43,155.00

Purchased Professional and Technical Services 24,970.00 212.00 25,182.00 25,180.80 1.20

General Supplies 5,000.00 (390.00) 4,610.00 4,543.97 66.03

Total Undist. Expend. - Security 73,020.00 (73.00) 72,947.00 72,879.77 67.23

Total Undist. Expend. - Oper & Maint. Of Plant 852,246.55 (25,698.00) 826,548.55 801,090.70 25,457.85

Undist. Expend. - Student Transportation Services

Salaries for Pupil Trans (Between Home and School)-Regular 61,906.00 (2,900.00) 59,006.00 58,795.19 210.81

Cleaning, Repair and Maintenance Services 7,500.00 950.00 8,450.00 8,390.55 59.45

Contracted Services (Other than Bet Home and School)-Vendors 15,000.00 31,278.00 46,278.00 46,277.80 0.20

Contracted Services (Special Ed. Students)-ESCs & CTSAs 96,257.00 45,322.00 141,579.00 141,156.89 422.11

Contracted Services - Aid in Lieu Payments 55,000.00 10,119.00 65,119.00 65,118.08 0.92


Total Undist. Expend. - Student Transportation Services 241,663.00 82,719.00 324,382.00 323,439.44 942.56

-72-

Exhibit C-1



General Fund


Budget



UNALLOCATED BENEFITS

Social Security Contributions 145,000.00 7,806.57 152,806.57 150,949.38 1,857.19

Other Retirement Contributions - PERS 147,500.00 3,227.00 150,727.00 150,726.64 0.36

Other Retirement Contributions - Regular 2,250.00 (232.00) 2,018.00 2,017.27 0.73

Workmen's Compensation 88,510.00 (1,121.00) 87,389.00 87,387.65 1.35

Health Benefits 2,713,728.00 (75,000.00) 2,638,728.00 2,570,793.73 67,934.27

Tuition Reimbursement 26,000.00 1.00 26,001.00 26,000.01 0.99

Other Employee Benefits 4,000.00 (2,000.00) 2,000.00 2,000.00

TOTAL UNALLOCATED BENEFITS 3,126,988.00 (67,318.43) 3,059,669.57 2,987,874.68 71,794.89

On-behalf Teachers Pension and Annuity Fund (non-budgeted) 1,065,654.00 (1,065,654.00)

On-behalf TPAF NCGI Premium (non-budgeted) 25,861.00 (25,861.00)

On-behalf TPAF Post Retirement Medical (non-budgeted) 704,986.00 (704,986.00)

On-behalf TPAF - LTDI 1,848.00 (1,848.00)

Reimbursed TPAF Social Security Contributions (non-budgeted) 559,442.83 (559,442.83)

TOTAL ON-BEHALF CONTRIBUTIONS 2,357,791.83 (2,357,791.83)

TOTAL PERSONAL SERVICES - EMPLOYEE BENEFITS 3,126,988.00 (67,318.43) 3,059,669.57 5,345,666.51 (2,285,996.94)

TOTAL UNDISTRIBUTED EXPENDITURES 7,261,584.43 (139,960.00) 7,121,624.43 9,343,833.07 (2,222,208.64)

TOTAL GENERAL CURRENT EXPENSE 13,934,812.46 (149,880.00) 13,784,932.46 15,959,713.15 (2,174,780.69)

CAPITAL OUTLAY

Equipment

Support Services:

Undistributed Expenditures - Technology Equipment 12,489.00 12,489.00 12,489.00

Undistributed Expenditures - Oper. & Maint. of Plant Services 7,560.00 6.00 7,566.00 7,566.00

Total Equipment 7,560.00 12,495.00 20,055.00 20,055.00

Facilities Acquisition and Construction Services

Architectural/Engineering Services 23,899.38 23,899.38 23,899.38

Construction Services 864,277.43 (111,685.59) 752,591.84 752,591.84

Assessment for Debt Service on SDA Funding 5,453.00 5,453.00 5,453.00

Total Facilities Acquisition and Construction Services 869,730.43 (87,786.21) 781,944.22 781,944.22

TOTAL CAPITAL OUTLAY 877,290.43 (75,291.21) 801,999.22 801,999.22

Transfer of Funds to Charter Schools 43,557.00 74,880.00 118,437.00 117,516.00 921.00

TOTAL EXPENDITURES 14,855,659.89 (150,291.21) 14,705,368.68 16,879,228.37 (2,173,859.69)

Excess (Deficiency) of Revenues

Over (Under) Expenditures (1,383,736.89) 150,291.21 (1,233,445.68) (666,461.36) 566,984.32

Excess (Deficiency) of Revenues and Other Financing Sources

Over (Under) Expenditures and Other Financing Sources (Uses) (1,383,736.89) 150,291.21 (1,233,445.68) (666,461.36) 566,984.32

Fund Balance, July 1 2,352,861.05 2,352,861.05 2,352,861.05

Fund Balance, June 30 969,124.16 150,291.21 1,119,415.37 1,686,399.69 566,984.32

Recapitulation of excess (deficiency) of revenues under expenditures:

Adjustment for Prior Year Encumbrances (37,171.89) (37,171.89) (37,171.89)

Increase in Capital Reserve

Principal 186,293.47 186,293.47

Interest 270.00 270.00 179.00 (91.00)

Withdrawal From Capital Reserve (851,990.00) 75,291.21 (776,698.79) (776,698.79)

Increase in Emergency Reserve

Interest 65.00 65.00 19.59 (45.41)

Withdrawal from Emergency Reserve (75,000.00) 75,000.00

Increase in Maintenance Reserve

Interest 90.00 90.00 46.00 (44.00)

Withdrawal From Maintenance Reserve (50,000.00) (50,000.00) (50,000.00)

Budgeted Fund Balance (370,000.00) (370,000.00) 10,871.26 380,871.26

Total (1,383,736.89) 150,291.21 (1,233,445.68) (666,461.36) 566,984.32

-73-

Exhibit C-1



General Fund


Budget



Recapitulation:

Restricted Fund BalanceCapital Reserve 490,885.24

Maintenance Reserve 265,613.95

Emergency Reserve 225,036.99

Assigned Fund Balance:Year-end Encumbrances 15,718.78

Designated for Subsequent Year's Expenditures 356,550.00

Unassigned Fund Balance:

Unrestricted Fund Balance - Undesignated 332,594.73

1,686,399.69

Reconciliation to Governmental Funds Statements (GAAP):

Last State Aid Payment not recognized on GAAP basis (707,163.00)

Fund Balance per Governmental Funds (GAAP) 979,236.69

-74-

E

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-75-

Exhibit C-3


Required Supplementary Information


Note to Required Supplementary Information - Part II


Note A - Explanation of Differences between Budgetary Inflows and Outflows and

GAAP Revenues and Expenditures

Special

General Revenue

Fund Fund

Sources/inflows of resources

Actual amounts (budgetary basis) "revenue"

from the budgetary comparison schedule [C-1]&[C-2] 16,212,767.01 1,527,807.37

Difference - budget to GAAP:

Grant accounting budgetary basis differs from GAAP in that

encumbrances are recognized as expenditures, and the related

revenue is recognized.

Add Prior Year Encumbrances

Less Current Year Encumbrances

The last State aid payment is recognized as revenue for budgetary

purposes in the General Fund, and differs from GAAP which

does not recognize this revenue until the subsequent year when

the State recognizes the related expense (GASB 33).

State aid payment recognized for budgetary purposes, not recognized

for GAAP statements until the subsequent year. (707,163.00)

State aid payment recognized for GAAP statements in the current

year, previously recognized for budgetary purposes. 680,709.00

Total revenues as reported on the statement of revenues, expenditures

and changes in fund balances - governmental funds. [B-2] 16,186,313.01 1,527,807.37

Uses/outflows of resources

Actual amounts (budgetary basis) "total outflows" from the

budgetary comparison schedule [C-1]&[C-2] 16,879,228.37 1,527,807.37

Differences - budget to GAAP

Encumbrances for supplies and equipment ordered but

not received are reported in the year the order is placed for

budgetary purposes, but in the year the supplies are received

for financial reporting purposes.

Add Prior Year Encumbrances

Less Current Year Encumbrances

Pension expense recognized for GAAP but not for budgetary

purposes. N/A

Total expenditures as reported on the statement of revenues,

expenditures, and changes in fund balances - governmental funds [B-2] 16,879,228.37 1,527,807.37

-76-


INFORMATION - PART III

Exhibit L-1BOROUGH OF HALEDON SCHOOL DISTRICT

Schedules of Required Supplementary Information

Schedule of District's Proportionate Share of Net Pension Liability - PERS

Last 10 Fiscal Years*

Fiscal Year

Ending June30,

District's

Proportion Share

of the Net

Pension Liability

(Asset)

District's

Proportion Share

of the Net

Pension Liability

(Asset)

District's Covered

Payroll -PERS

Employee's

District's

Proportion

Share of the Net

Pension Liability

(Asset) as a

perecntage of its

Covered Payroll

Plan Fiduciary

Net Position as a

percentage of the

total Pension

Liability

2015 0.0153161340% $2,867,599 $1,060,629 270.37% 52.08%

2016 0.0157796884% 3,542,224 1,094,368 323.68% 47.93%

2017 0.0162943862% 4,825,930 1,102,404 437.76% 59.86%

2018 0.0160495565% 3,736,080 1,119,326 333.78% 48.10%

* GASB requires that ten years of information be presented. However, since fiscal year 2015 was the first year of

GASB 68 implementation ten years is not presented. Each year thereafter, an additional year will be included until ten

years of data is presented.

-77-


Schedules of Required Supplementary Information

Schedule of District's Contributions - PERS


Fiscal Year

Ending June30,

Contractually

Required

Contribution

Contributions in

Relation to the

Contractually

Required

Contributions

Contribution

Deficiency

(Excess)

District's PERS

Covered-

Employee

Payroll

Contributions as

a Percentage of

PERS Covered-

Employee Payroll

2015 126,264$ 126,264$ -$ $1,060,629 11.90%

2016 135,663 135,663 - 1,094,368 12.40%

2017 144,757 144,757 - 1,102,404 13.13%

2018 148,682 148,682 - 1,119,326 13.28%




-78-


Schedules of Required Supplementary InformationSchedule of District's Proportionate Share of Net Pension Liability - TPAF


Fiscal Year

Ending June30,

District's

Proportion Share

of the Net

Pension Liability

(Asset)

District's

Proportion Share

of the Net

Pension Liability

(Asset)

State's

Proportionate

Share of the Net

Pension Liability

Associated with

the District

(Asset)

District's Covered

Payroll -TPAF

Employee's

District's

Proportion Share

of the Net

Pension Liability

(Asset) as a

perecntage of its

Covered Payroll

Plan Fiduciary

Net Position as a

percentage of the

total Pension

Liability

2015 0.0631412808% -$ 33,746,960$ 7,392,155$ 0.00% 33.64%2016 0.0665816926% -$ 42,082,473 7,408,447 0.00% 28.71%2017 0.0677025260% -$ 53,259,118 7,483,995 0.00% 28.75%2018 0.0734662699% -$ 49,533,608 7,603,809 0.00% 34.07%




-79-

Exhibit L-4


Note to Required Schedules of Supplementary Information - Part III

For the fiscal year ended June 30, 2018

PUBLIC EMPLOYEES RETIREMENT SYSTEM (PERS)

Change in benefit terms

None

Change in assumptions

The calculation of the discount rate used to measure the total

pension liability is dependent upon the long·term expected rate

of return, and the municipal bond index rate. There was a change

in the municipal bond index rate from the prior measurement date

(2.85%) to the current measurement date (3.58%), resulting in a

change in the discount rate from 3.98% to 5.00%. This change in the

discount rate is considered to be a change in actuarial assumptions

under GASBS No. 68.

TEACHERS PENSION AND ANNUITY FUND (TPAF)

Change in benefit terms

Change in assumptions

The calculation of the discount rate used to measure the total

pension liability is dependent upon the long·term expected rate

of return, and the municipal bond index rate. There was a change

in the municipal bond index rate from the prior measurement date

(2.85%) to the current measurement date (3.58%), resulting in a

change in the discount rate from 3.22 to 4.25%. This change in the

discount rate is considered to be a change in actuarial assumptions

under GASBS No. 68.

-80-

Supplementary Schedules

SPECIAL REVENUE FUND

Ex

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-81-

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-82-

Exhibit E-2


Special Revenue Fund

Schedule of Preschool Education Aid

Budgetary Basis


Budgeted Actual Variance

EXPENDITURES:

Instruction:

Salaries of Teachers 331,788.00 317,728.71 14,059.29

Other Salaries for Instruction 57,299.00 57,125.63 173.37

Purchased Professional - Educational Services 18,000.00 13,229.31 4,770.69

General Supplies 36,988.00 36,542.64 445.36

Total instruction 444,075.00 424,626.29 19,448.71

Support services:

Salaries of Program Directors 18,300.00 18,297.12 2.88

Salaries of Other Professional Staff 8,619.00 8,618.60 0.40

Salaries of Secretarial and Clerical Assist 9,175.00 7,711.08 1,463.92

Other Salaries 27,067.00 26,324.64 742.36

Personal Services - Employee Benefits 90,389.00 90,389.00

Contr Serv - Trans. (Field Trips) 1,500.00 690.00 810.00

Other Purchased Services (400-500 series) 12,670.00 12,669.64 0.36

Supplies & Materials 24,503.00 24,503.00

Total support services 192,223.00 164,700.08 27,522.92

Equipment

Instructional equipment 20,675.00 20,675.00

Total Equipment 20,675.00 20,675.00

Total expenditures 656,973.00 589,326.37 67,646.63

Total Revised 2017-18 Preschool Education Aid Allocation 656,973.00

Actual Preschool Carryover ( June 30, 2017) 32,672.51

Total Preschool Education Aid Funds Available for 2017-18 Budget 689,645.51

Less: 2017-18 Budgeted Preschool Education Aid (Including

prior year budgeted carryover) (656,973.00)

Available & Unbudgeted Preschool Education Aid Funds as of June 30, 2018 32,672.51

Add: 2017-18 Unexpended Preschool Education Aid 67,646.63

2017-18 Actual Carryover - Preschool Education Aid 100,319.14

2017-18 Preschool Education Aid Carryover Budgeted in 2018-19 100,319.14

CALCULATION OF BUDGET & CARRYOVER

District-wide Total

-83-

PROPRIETARY FUNDS

Exhibit G-1


Combining Statement of Net Position

Enterprise Funds

June 30, 2018

After Care/

Food Service Summer Camp

Program Program Totals

ASSETS

Current Assets:

Cash and Cash Equivalents 85,878.41 199,906.26 285,784.67

Accounts Receivable:

State 621.92 621.92

Federal 38,302.14 38,302.14

Other 5,517.87 5,517.87

Inventories 4,736.52 4,736.52

Total Current Assets 129,538.99 205,424.13 334,963.12

Noncurrent Assets:

Capital Assets:

Equipment 469,318.43 469,318.43

Less Accumulated Depreciation (236,887.52) (236,887.52)

Total Capital Assets (Net of Accumulated

Depreciation) 232,430.91 232,430.91

Total Assets 361,969.90 205,424.13 567,394.03

LIABILITIES

Current Liabilities:

Accounts Payable 4,551.24 667.58 5,218.82

Prepaid Revenue 76.13 76.13

Interfunds Payable 68,110.40 68,110.40

Total Current Liabilities 72,737.77 667.58 73,405.35

Total Liabilities 72,737.77 667.58 73,405.35

NET POSITION

Invested in Capital Assets Net of

Related Debt 232,430.91 232,430.91

Unrestricted 56,801.22 204,756.55 261,557.77

Total Net Position 289,232.13 204,756.55 493,988.68

-84-

Exhibit G-2


Combining Statement of Revenues, Expenses, and Changes in Fund Net Position

Enterprise Funds


After Care /



Operating Revenues:

Charges for Services:

Daily Sales - Non-Reimbursable Programs 25,399.05 25,399.05

Miscellaneous - Program Fees 301,170.04 301,170.04

Total Operating Revenues 25,399.05 301,170.04 326,569.09

Operating Expenses:

Cost of food-reimbursable programs 289,924.23 289,924.23

Cost of food-non-reimbursable programs 56,844.00 56,844.00

Salaries 165,824.31 279,388.32 445,212.63

Supplies and Materials 53,482.82 3,974.42 57,457.24

Employee Benefits 32,883.06 14,567.04 47,450.10

Purchased Professional and Technical Services 11,852.00 100.16 11,952.16

Cleaning Repair & Maintenance 20,320.69 20,320.69

Utilities 4,853.89 4,853.89

Other Purchased Services 65.00 65.00

Miscellaneous Expense 13,789.75 5,532.31 19,322.06

Transportation 1,205.00 1,205.00

Depreciation 17,681.82 17,681.82

Total Operating Expenses 667,521.57 304,767.25 972,288.82


Nonoperating Revenues (Expenses):

State Sources:

State School Lunch Program 7,935.52 7,935.52

Federal Sources:

National School Lunch Program 362,954.84 362,954.84

School Breakfast Program 103,176.77 103,176.77

After School Snack Program 30,422.48 30,422.48

HHFKA Program 8,877.12 8,877.12

U.S.D.A. Commodities:

Food Distribution Program 44,170.48 44,170.48

Interest and Investment Revenue 72.54 72.54

Total Nonoperating Revenues (Expenses) 557,609.75 557,609.75

Income (Loss) Before Contributions & Transfers (84,512.77) (3,597.21) (88,109.98)

Cancellation of Prior Year Receivable (2,063.14) (2,063.14)

Change in Net Position (86,575.91) (3,597.21) (90,173.12)

Total Net Position—Beginning 375,808.04 208,353.76 584,161.80

Total Net Position—Ending 289,232.13 204,756.55 493,988.68

-85-

Exhibit G-3


Combining Statement of Cash Flows

Enterprise Funds


After Care /



CASH FLOWS FROM OPERATING ACTIVITIES

Receipts from Customers 25,475.18 298,753.13 324,228.31

Payments for Interfunds (10,697.95) (10,697.95)

Payments to Employees (29,749.01) (279,388.32) (309,137.33)

Payments for Employee Benefits (2,403.56) (14,567.04) (16,970.60)

Payments to Suppliers (30.00) (3,306.84) (3,336.84)

Payments for Miscellaneous Expenses (5,696.80) (6,837.47) (12,534.27)

Payments to Food Service Management Company (514,500.17) (514,500.17)


CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES

State Sources 8,806.53 8,806.53

Federal Sources 529,404.96 529,404.96

Net Cash Provided by (Used for) Non-Capital Financing Activities 538,211.49 538,211.49

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES

Purchases of Capital Assets (48,090.36) (48,090.36)

Net Cash Provided by (Used for) Capital and Related Financing Activities (48,090.36) (48,090.36)

CASH FLOWS FROM INVESTING ACTIVITIES

Interest and dividends 72.54 72.54

Net Cash Provided by (Used for) Investing Activities 72.54 72.54

Net Increase (Decrease) in Cash and Cash Equivalents (47,408.64) (5,346.54) (52,755.18)

Balances—Beginning of Year 133,287.05 205,252.80 338,539.85

Balances—End of Year 85,878.41 199,906.26 285,784.67

Reconciliation of Operating Income (Loss) to Net Cash Provided

(Used) by Operating Activities:


Adjustments to Reconcile Operating Income (Loss) to Net Cash Provided

(Used for) Operating Activities

Depreciation and Net Amortization 17,681.82 17,681.82

Food Distribution Program Donated Commodities 44,170.48 44,170.48

(Increase) Decrease in Accounts Receivable, Net 59.79 59.79

(Increase) Decrease in Inventories (1,826.79) (1,826.79)

Increase (Decrease) in Accounts Payable 4,551.24 667.58 5,218.82

Increase (Decrease) in Other Current Liabilities 39,943.46 (2,476.70) 37,466.76

Total Adjustments 104,520.21 (1,749.33) 102,770.88


-86-

FIDUCIARY FUND

Exhibit H-1


Combining Statement of Fiduciary Net Position

Fiduciary Funds

June 30, 2018

Unemployment

Compensation Agency

Trust Fund Fund

ASSETS


Interfund Receivable 4,745.31 2,496.84

Total Assets 328,545.50 541,291.05

LIABILITIES

Interfund Payable 4,771.20

Payable to Student Groups 25,575.45

Payroll Deductions and Withholdings 510,944.40

Total Liabilities 541,291.05

NET POSITION

Held in Trust for Unemployment

Claims and Other Purposes 328,545.50

-87-

Exhibit H-2


Combining Statement of Changes in Fiduciary Net Position

Fiduciary Funds


Unemployment

Compensation

Trust Fund

ADDITIONS

Contributions:

Plan Member 24,429.61

Total Contributions 24,429.61

Investment Earnings:

Interest 359.10

Net Investment Earnings 359.10

Total Additions 24,788.71

DEDUCTIONS

Quarterly Contribution Reports 7,101.48

Unemployment Claims 25,130.17

Total Deductions 32,231.65

Change in Net Position (7,442.94)

Net Position—Beginning of the Year 335,988.44

Net Position—End of the Year 328,545.50

-88-

Exh

ibit

H-3

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Stu

den

t A

ctiv

ity A

gen

cy F

un

d

Sch

edu

le o

f R

ecei

pts

an

d D

isb

urs

em

ents

For

the

Yea

r E

nd

ed J

un

e 30,

2018

Bal

ance

Bal

ance

July

1, 2017

Rev

enues

Ex

pen

dit

ure

sJu

ne

30, 2018

EL

EM

EN

TA

RY

SC

HO

OL

S:

Gen

eral

Org

aniz

atio

n A

ll S

chools

31,2

09.3

473,1

14.8

378,7

48.7

225,5

75.4

5

31,2

09.3

473,1

14.8

378,7

48.7

225,5

75.4

5

-89-

Exhibit H-4


Payroll Agency Fund

Schedule of Receipts and Disbursements


Balance Cash Cash BalanceJuly 1, 2017 Receipts Disbursed June 30, 2018

Net Payroll 5,553,248.85 5,553,248.85

Payroll Deductions

and Withholdings 517,894.70 5,213,579.55 5,220,529.85 510,944.40

Interfunds Receivable (11,342.10) 11,342.10 2,496.84 (2,496.84)

Interfunds Payable 6,323.63 21,119.52 22,671.95 4,771.20

512,876.23 10,799,290.02 10,798,947.49 513,218.76

-90-

STATISTICAL SECTION

STATISTICAL SECTION (UNAUDITED)

Introduction to the Statistical Section

Financial Trends

J-1 Net Assets/Position by Component

J-2 Changes in Net Assets/Position

J-3 Fund Balances - Governmental Funds

J-4 Changes in Fund Balances - Governmental Funds

J-5 General Fund Other Local Revenue by Source

Revenue Capacity

J-6 Assessed Value and Estimated Actual Value of Taxable Property

J-7 Direct and Overlapping Property Tax Rates

J-8 Principal Property Taxpayers

J-9 Property Tax Levies and Collections

Debt Capacity

J-10 Ratios of Outstanding Debt by Type

J-11 Ratios of General Bonded Debt Outstanding

J-12 Direct and Overlapping Governmental Activities Debt

J-13 Legal Debt Margin Information

Demographic and Economic Information

J-14 Demographic and Economic Statistics

J-15 Principal Employers

Operating Information

J-16 Full-time Equivalent District Employees by Function/Program

J-17 Operating Statistics

J-18 School Building Information*

J-19 Schedule of Allowable Maintenance Expenditures by School Facility

J-20 Insurance Schedule

Exh

ibit

J-1

BO

RO

UG

H O

F H

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SC

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DIS

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Net

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ion

by C

om

po

nen

t

Last

Ten

Fis

cal

Years

(accru

al

basis

of

acco

un

tin

g)

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Go

vern

men

tal

Acti

vit

ies

Investe

d in C

apital A

ssets

5,3

73,8

09.7

35,6

46,7

42.0

66,9

14,6

24.8

76,7

23,1

06.4

07,4

10,6

92.3

98,6

77,9

63.9

610,1

43,7

96.8

910,5

10,2

34.3

610,8

57,0

94.9

011,0

59,8

43.4

6

Restr

icte

d2,2

46,2

08.8

63,1

16,1

24.8

73,2

03,5

89.8

94,0

80,4

18.5

14,5

00,4

35.8

73,9

80,1

20.9

73,4

25,3

54.1

22,4

95,4

67.7

51,6

21,6

96.9

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36.1

8

Unre

str

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d(1

89,3

27.6

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28.2

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(306,9

05.8

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(452,3

78.2

0)

(507,9

21.5

3)

(451,7

67.6

3)

(3,3

43,7

37.3

7)

(3,3

08,4

58.8

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(3,4

90,6

39.7

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(3,6

77,9

35.7

7)

Tota

l G

overn

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l A

ctivitie

s N

et

Positio

n7,4

30,6

90.9

18,5

93,4

38.6

69,8

11,3

08.9

310,3

51,1

46.7

111,4

03,2

06.7

312,2

06,3

17.3

010,2

25,4

13.6

49,6

97,2

43.3

08,9

88,1

52.1

08,3

63,4

43.8

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Bu

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18.8

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44.5

044,9

45.4

9190,8

04.9

1176,8

51.7

3187,3

21.4

7171,6

23.7

9163,5

23.3

1202,0

22.3

7232,4

30.9

1

Unre

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73.4

2367,2

24.4

9388,6

66.9

1223,7

65.7

8249,9

82.0

2328,7

50.5

4421,6

64.8

1476,5

84.4

4382,1

39.4

3261,5

57.7

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Tota

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s N

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Positio

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92.2

9417,4

68.9

9433,6

12.4

0414,5

70.6

9426,8

33.7

5516,0

72.0

1593,2

88.6

0640,1

07.7

5584,1

61.8

0493,9

88.6

8

Dis

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Investe

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apital A

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, N

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of

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5,3

93,7

28.6

05,6

96,9

86.5

66,9

59,5

70.3

66,9

13,9

11.3

17,5

87,5

44.1

28,8

65,2

85.4

310,3

15,4

20.6

810,6

73,7

57.6

711,0

59,1

17.2

711,2

92,2

74.3

7

Restr

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d2,2

46,2

08.8

63,1

16,1

24.8

73,2

03,5

89.8

94,0

80,4

18.5

14,5

00,4

35.8

73,9

80,1

20.9

73,4

25,3

54.1

22,4

95,4

67.7

51,6

21,6

96.9

1981,5

36.1

8

Unre

str

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d169,0

45.7

4197,7

96.2

281,7

61.0

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28,6

12.4

2)

(257,9

39.5

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(123,0

17.0

9)

(2,9

22,0

72.5

6)

(2,8

31,8

74.3

7)

(3,1

08,5

00.2

8)

(3,4

16,3

78.0

0)

Tota

l D

istr

ict

Net

Positon

7,8

08,9

83.2

09,0

10,9

07.6

510,2

44,9

21.3

310,7

65,7

17.4

011,8

30,0

40.4

812,7

22,3

89.3

110,8

18,7

02.2

410,3

37,3

51.0

59,5

72,3

13.9

08,8

57,4

32.5

5

Sou

rce:

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ched

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A-1

-91-

Exh

ibit

J-2

BO

RO

UG

H O

F H

AL

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ON

SC

HO

OL

DIS

TR

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Ch

an

ges in

Net

Po

sit

ion

Last

Ten

Fis

cal Y

ears

(accru

al b

asis

of

acco

un

tin

g)

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Exp

en

ses

Govern

menta

l A

ctivitie

s:

Instr

uction:

Regula

r5,2

53,6

23.0

25,6

59,5

28.4

45,9

40,3

08.1

85,6

73,4

58.3

56,3

53,8

57.5

36,4

92,9

24.7

96,7

63,1

40.4

36,8

08,2

86.0

76,8

79,6

19.1

87,3

72,9

97.0

5

Specia

l E

ducation

1,1

39,7

83.2

01,1

92,1

68.3

11,1

13,3

62.6

61,2

73,1

83.8

61,3

77,6

24.2

91,5

93,2

87.9

21,7

69,4

25.2

92,0

08,9

66.2

72,2

62,3

65.0

12,0

39,1

84.9

1

Oth

er

Specia

l In

str

uction

387,8

05.2

7311,5

21.8

3271,5

83.6

0581,4

21.6

9490,7

80.5

3488,3

78.1

4762,0

92.5

6808,0

95.6

2771,8

49.7

2736,1

54.6

6

Oth

er

Instr

uction

127,3

36.5

2130,1

84.9

1110,4

99.1

689,4

27.3

3101,8

30.4

4104,8

75.1

0123,5

63.5

2107,1

75.7

1111,6

45.1

1125,4

07.3

6

Support

Serv

ices:

Tuitio

n665,2

51.9

8401,7

78.9

0461,2

09.2

3439,8

36.2

4255,1

39.0

3180,9

15.5

8151,8

32.0

5212,7

62.2

5184,2

21.4

7248,5

68.5

6

Stu

dent &

Instr

uction R

ela

ted S

erv

ices

1,5

21,8

59.3

81,6

95,8

37.7

81,9

32,0

72.3

71,6

75,5

47.8

51,8

53,2

38.5

21,8

59,4

97.8

11,8

35,9

99.4

52,0

55,3

30.0

42,0

25,6

20.6

72,0

59,5

05.7

0

School A

dm

inis

trative S

erv

ices

601,6

83.2

4626,2

51.6

7691,9

39.6

3624,7

35.1

9604,5

42.9

5614,0

21.7

1629,7

49.8

1621,4

25.5

2664,0

65.9

2677,8

04.6

3

Genera

l A

dm

inis

trative S

erv

ices

342,4

18.7

2415,6

90.6

8353,0

50.5

0310,0

97.6

6393,1

01.3

0351,3

38.6

6350,0

41.4

5342,1

27.6

1373,5

10.5

1351,0

17.9

6

Centr

al S

erv

ices &

Adm

in. In

fo. T

echnolo

gy

521,9

56.6

0453,3

23.0

6461,1

19.0

7381,6

43.3

6445,8

42.4

8454,3

93.0

4455,9

04.8

9431,5

74.9

5484,3

49.1

4502,0

03.9

9

Pla

nt O

pera

tions a

nd M

ain

tenance

938,9

52.9

7917,7

09.5

2904,1

73.3

8953,1

02.3

8772,5

68.9

8942,4

15.1

6959,2

84.4

7927,2

84.3

9977,9

31.1

2925,7

20.7

3

Pupil

Tra

nsport

ation

274,5

58.4

7229,6

27.9

6214,4

47.7

0267,7

38.7

2239,1

45.3

4244,3

43.9

2238,0

03.7

8288,8

37.5

0257,4

55.6

0345,1

77.6

9

Unallo

cate

d B

enefits

812,7

19.9

0869,2

19.1

6872,2

91.8

81,0

77,7

79.6

71,3

68,5

12.3

81,1

95,8

14.9

52,9

29,9

33.7

93,1

59,3

14.2

45,2

32,0

80.2

26,3

51,1

01.8

8

Specia

l S

chools

3,6

50.0

0

Chart

er

Schools

76,9

03.0

046,4

96.0

0117,5

16.0

0

Inte

rest on L

ong-t

erm

Debt

41,2

50.0

032,2

50.0

023,2

50.0

014,2

50.0

05,2

50.0

0

Capital O

utlay -

Non-d

epre

cia

ble

30.7

437,5

08.8

82,8

11.0

011,8

87.0

02,5

90.0

05,4

53.0

05,4

53.0

05,4

53.0

05,4

53.0

05,4

53.0

0

Unallo

cate

d D

epre

cia

tion

188,3

21.8

2183,6

42.2

4183,6

48.5

5170,0

40.3

0179,1

72.4

3236,8

45.7

1325,0

33.6

3373,7

24.5

0419,1

32.1

1452,6

12.4

9

Tota

l G

overn

menta

l A

ctivitie

s E

xpenses

12,8

21,2

01.8

313,1

56,2

43.3

413,5

35,7

66.9

113,5

44,1

49.6

014,4

43,1

96.2

014,7

64,5

05.4

917,2

99,4

58.1

218,2

27,2

60.6

720,6

95,7

94.7

822,3

10,2

26.6

1

Busin

ess-t

ype A

ctivitie

s:

Food S

erv

ice

404,9

11.7

8460,3

34.0

2381,4

14.2

5469,1

33.6

5440,7

01.9

0476,4

77.1

9469,7

18.0

6539,6

68.8

5643,6

36.7

2667,5

21.5

7

After

Care

Pro

gra

m166,1

22.9

6171,6

42.4

0178,1

31.2

5172,8

13.4

4180,0

83.1

1151,7

79.7

8218,6

42.0

8253,6

33.1

5267,9

86.5

9304,7

67.2

5

Sum

mer

Cam

p P

rogra

m29,8

30.5

1

Tota

l B

usin

ess-t

ype A

ctivitie

s E

xpenses

600,8

65.2

5631,9

76.4

2559,5

45.5

0641,9

47.0

9620,7

85.0

1628,2

56.9

7688,3

60.1

4793,3

02.0

0911,6

23.3

1972,2

88.8

2

Tota

l D

istr

ict E

xpenses

13,4

22,0

67.0

813,7

88,2

19.7

614,0

95,3

12.4

114,1

86,0

96.6

915,0

63,9

81.2

115,3

92,7

62.4

617,9

87,8

18.2

619,0

20,5

62.6

721,6

07,4

18.0

923,2

82,5

15.4

3

Pro

gra

m R

even

ues

Govern

menta

l A

ctivitie

s:

Opera

ting G

rants

and C

ontr

ibutions

1,1

84,0

25.9

91,4

45,4

96.6

81,8

87,0

84.4

91,3

23,2

85.6

51,5

79,1

10.8

31,4

99,3

23.9

21,2

25,2

14.2

01,4

42,2

79.7

61,2

53,9

68.2

21,5

15,0

57.3

7

Tota

l G

overn

menta

l A

ctivitie

s P

rogra

m R

evenues

1,1

84,0

25.9

91,4

45,4

96.6

81,8

87,0

84.4

91,3

23,2

85.6

51,5

79,1

10.8

31,4

99,3

23.9

21,2

25,2

14.2

01,4

42,2

79.7

61,2

53,9

68.2

21,5

15,0

57.3

7

Busin

ess-t

ype A

ctivitie

s:

Charg

es for

Serv

ices:

Food S

erv

ice

112,2

85.5

0101,7

21.3

797,3

15.2

497,7

29.2

298,6

20.4

297,4

68.0

1104,2

75.5

0114,6

67.2

732,6

54.8

125,3

99.0

5

After

Care

Pro

gra

m149,6

44.3

4150,4

41.7

0139,5

25.9

0140,2

48.8

8142,2

17.9

0196,5

60.0

2238,2

54.1

8251,8

28.9

0277,1

03.1

9301,1

70.0

4

Sum

mer

Cam

p P

rogra

m25,5

49.1

2

Opera

ting G

rants

and C

ontr

ibutions

345,7

14.3

5418,9

90.0

5338,8

47.7

7384,9

25.0

7392,1

98.9

7423,4

45.0

5423,0

03.4

8472,0

79.6

5545,7

84.0

7557,5

37.2

1

Tota

l B

usin

ess-t

ype A

ctivitie

s P

rogra

m R

evenues

633,1

93.3

1671,1

53.1

2575,6

88.9

1622,9

03.1

7633,0

37.2

9717,4

73.0

8765,5

33.1

6838,5

75.8

2855,5

42.0

7884,1

06.3

0

Tota

l D

istr

ict P

rogra

m R

evenues

1,8

17,2

19.3

02,1

16,6

49.8

02,4

62,7

73.4

01,9

46,1

88.8

22,2

12,1

48.1

22,2

16,7

97.0

01,9

90,7

47.3

62,2

80,8

55.5

82,1

09,5

10.2

92,3

99,1

63.6

7

-92-

Exh

ibit

J-2

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Ch

an

ges in

Net

Po

sit

ion

Last

Ten

Fis

cal Y

ears

(accru

al b

asis

of

acco

un

tin

g)

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Net

(Exp

en

se)/

Reven

ue

Govern

menta

l A

ctivitie

s(1

1,6

37,1

75.8

4)

(11,7

10,7

46.6

6)

(11,6

48,6

82.4

2)

(12,2

20,8

63.9

5)

(12,8

64,0

85.3

7)

(13,2

65,1

81.5

7)

(16,0

74,2

43.9

2)

(16,7

84,9

80.9

1)

(19,4

41,8

26.5

6)

(20,7

95,1

69.2

4)

Busin

ess-t

ype A

ctivitie

s32,3

28.0

639,1

76.7

016,1

43.4

1(1

9,0

43.9

2)

12,2

52.2

889,2

16.1

177,1

73.0

245,2

73.8

2(5

6,0

81.2

4)

(88,1

82.5

2)

Tota

l D

istr

ict-

wid

e N

et E

xpense

(11,6

04,8

47.7

8)

(11,6

71,5

69.9

6)

(11,6

32,5

39.0

1)

(12,2

39,9

07.8

7)

(12,8

51,8

33.0

9)

(13,1

75,9

65.4

6)

(15,9

97,0

70.9

0)

(16,7

39,7

07.0

9)

(19,4

97,9

07.8

0)

(20,8

83,3

51.7

6)

Gen

era

l R

even

ues a

nd

Oth

er

Ch

an

ges in

Net

Assets

Govern

menta

l A

ctivitie

s:

Pro

pert

y T

axes L

evie

d for

Genera

l P

urp

oses

5,2

61,8

21.0

05,2

45,2

29.0

05,4

55,0

38.0

05,5

64,1

38.0

05,6

19,8

09.0

05,8

35,2

05.0

05,9

51,9

09.0

06,0

70,9

48.0

06,3

30,0

00.0

06,4

56,6

00.0

0

Taxes L

evie

d for

Debt S

erv

ice

108,9

73.0

0104,1

90.0

0112,5

44.0

0107,1

28.0

0101,7

11.0

0

Sta

te F

acili

ties G

rant

144,2

70.4

8267,3

27.7

419,3

37.7

8158,1

43.5

11,2

27,0

59.4

68,6

34.4

2

Cancella

tion o

f S

tate

Facili

ties G

rant R

eceiv

able

(109,3

10.0

0)

Unre

str

icte

d F

edera

l and S

tate

Aid

6,9

18,0

87.8

27,4

13,1

40.8

27,0

87,7

95.2

27,5

88,8

07.4

58,1

10,7

71.6

08,0

47,9

74.4

79,7

94,6

61.2

010,0

81,5

25.8

012,1

79,3

72.7

413,5

86,3

86.8

6

Tuitio

n R

eceiv

ed

41,1

97.0

03,8

08.5

0

Oth

er

Local G

overn

ment U

nits -

Restr

icte

d52,2

40.0

055,3

80.1

410,8

62.5

617,8

50.0

0

Investm

ent E

arn

ings

18,6

53.6

86,9

89.2

51,3

95.8

81,3

46.3

4380.9

51,8

54.7

01,0

45.6

4251.1

6429.0

1827.9

4

Mis

cella

neous Incom

e87,9

25.2

051,7

05.3

410,1

28.9

719,6

89.1

264,1

35.0

67,2

64.4

669,5

49.9

695,4

51.1

9181,7

36.6

1122,8

37.7

1

Tota

l G

overn

menta

l A

ctivitie

s12,3

95,4

60.7

012,8

73,4

94.4

112,8

66,5

52.6

913,4

49,9

89.2

113,9

16,1

45.3

914,0

68,2

92.1

417,0

44,2

25.2

616,2

56,8

10.5

718,7

32,7

35.3

620,1

70,4

61.0

1

Busin

ess-t

ype A

ctivitie

s:

Investm

ent E

arn

ings

2.2

110.7

822.1

543.5

748.8

2135.2

972.5

4

Cancella

tion o

f P

rior

Year

Receiv

able

(2,0

63.1

4)

Mis

cella

neous Incom

e1,4

96.5

1

Tota

l B

usin

ess-t

ype A

ctivitie

s0.0

00.0

00.0

02.2

110.7

822.1

543.5

71,5

45.3

3135.2

9(1

,990.6

0)

Tota

l D

istr

ict-

wid

e12,3

95,4

60.7

012,8

73,4

94.4

112,8

66,5

52.6

913,4

49,9

91.4

213,9

16,1

56.1

714,0

68,3

14.2

917,0

44,2

68.8

316,2

58,3

55.9

018,7

32,8

70.6

520,1

68,4

70.4

1

Ch

an

ge in

Net

Po

sit

ion

Govern

menta

l A

ctivitie

s758,2

84.8

61,1

62,7

47.7

51,2

17,8

70.2

71,2

29,1

25.2

61,0

52,0

60.0

2803,1

10.5

7969,9

81.3

4(5

28,1

70.3

4)

(709,0

91.2

0)

(624,7

08.2

3)

Busin

ess-t

ype A

ctivitie

s32,3

28.0

639,1

76.7

016,1

43.4

1(1

9,0

41.7

1)

12,2

63.0

689,2

38.2

677,2

16.5

946,8

19.1

5(5

5,9

45.9

5)

(90,1

73.1

2)

Tota

l D

istr

ict

790,6

12.9

21,2

01,9

24.4

51,2

34,0

13.6

81,2

10,0

83.5

51,0

64,3

23.0

8892,3

48.8

31,0

47,1

97.9

3(4

81,3

51.1

9)

(765,0

37.1

5)

(714,8

81.3

5)

Sourc

e: C

AF

R S

ched

ule

A-2

-93-

Exh

ibit

J-3

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Fu

nd

Ba

lan

ce

s G

ove

rnm

en

tal

Fu

nd

s

Last

Ten

Fis

cal Y

ears

(mo

dif

ied

ac

cru

al

bas

is o

f a

cc

ou

nti

ng

)

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Gen

era

l F

un

d

Re

se

rve

d2,2

46,2

08.7

53,0

63,1

11.2

4

Unre

serv

ed

(97

,914

.72

)(5

6,3

31

.87

)

Restr

icte

d2,5

14,7

03.2

83,6

28,7

58.6

54,0

44,0

63.7

53,1

20,9

01.5

83,3

47,1

84.6

62,4

95,4

67.7

51,6

21,6

96.9

1981,5

36.1

8

Assig

ned

259,0

37.5

028,0

04.2

027,1

35.0

7294,4

72.4

6172,3

04.9

3240,5

13.6

7408,6

09.4

8372,2

68.7

8

Unassig

ned

(97

,914

.72

)(5

6,3

31

.87

)(3

17

,77

5.2

6)

(31

6,8

57

.74)

(37

0,9

04

.00)

(36

7,5

67

.68)

(40

0,0

39

.89)

(35

4,9

29

.42)

(35

8,1

54

.34)

(37

4,5

68

.27)

Tota

l G

enera

l fu

nd

2,0

50,3

79.3

12,9

50,4

47.5

02,4

55,9

65.5

23,3

39,9

05.1

13,7

00,2

94.8

23,0

47,8

06.3

63,1

19,4

49.7

02,3

81,0

52.0

01,6

72,1

52.0

5979,2

36.6

9

All O

ther

Go

vern

men

tal F

un

ds

Unre

serv

ed, R

eport

ed in:

Capital P

roje

cts

Fund

53,0

13.5

2554,8

49.0

0423,6

55.5

8429,2

37.0

5617,1

71.3

978,1

69.4

6

De

bt

Serv

ice

0.1

10.1

10.1

10.1

1

Tota

l A

ll O

ther

Govern

menta

l F

unds

0.1

153,0

13.6

3554,8

49.1

1423,6

55.6

9429,2

37.0

5617,1

71.3

978,1

69.4

60.0

00.0

00.0

0

Sourc

e:

CA

FR

Sch

edule

B-1

GA

SB

No. 54 w

as im

ple

mente

d in the 2

011 fis

cal year,

whic

h r

equir

ed the p

resenta

tion o

f fu

nd b

ala

nces to b

e r

eport

ed in d

iffe

rent cla

ssific

ations

from

those p

resente

d in p

rior

years

. P

rior

years

have n

ot been r

esta

ted a

bove, nor

or

they r

equir

ed to b

e.

-94-

Exh

ibit

J-4

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Ch

an

ges i

n F

un

d B

ala

nces G

overn

men

tal

Fu

nd

s

Last

Ten

Fis

cal

Years

(mo

dif

ied

accru

al

basis

of

acco

un

tin

g)

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Reven

ues

Tax L

evy

5,3

70,7

94.0

05,3

49,4

19.0

05,5

67,5

82.0

05,6

71,2

66.0

05,7

21,5

20.0

05,8

35,2

05.0

05,9

51,9

09.0

06,0

70,9

48.0

06,3

30,0

00.0

06,4

56,6

00.0

0

Tuitio

n17,8

50.0

041,1

97.0

03,8

08.5

0

Oth

er

Local G

overn

ment

Units -

Restr

icte

d52,2

40.0

055,3

80.1

410,8

62.5

6

Inte

rest

Earn

ed o

n E

merg

ency R

eserv

e F

unds

25.0

0101.7

817.4

019.5

9

Inte

rest

Earn

ed o

n C

apital R

eserv

e F

unds

1,4

04.7

2259.8

9516.4

0274.5

5111.4

8495.0

0196.3

952.0

097.0

0179.0

0

Inte

rest

Earn

ed o

n M

ain

tenance R

eserv

e F

unds

112.8

825.0

0115.6

575.0

0176.4

2105.0

026.0

031.0

046.0

0

Inte

rest

Earn

ing

s17,2

48.9

66,6

16.4

8829.4

8854.3

6194.4

71,1

83.2

8744.2

5173.1

6283.6

1583.3

5

Mis

cella

neous

89,2

96.0

351,7

05.3

410,1

28.9

719,6

89.1

264,1

35.0

67,2

64.4

669,5

49.9

695,4

51.1

9181,7

36.6

1122,8

37.7

1

Sta

te S

ourc

es

7,4

84,7

32.0

96,8

08,1

12.3

47,8

88,3

56.4

28,2

69,3

49.9

98,7

21,2

06.7

48,7

26,0

86.1

29,9

45,9

07.1

49,0

91,4

67.7

79,3

81,8

00.6

510,1

69,4

15.9

5

Federa

l S

ourc

es

616,0

10.8

92,0

50,5

25.1

61,2

30,7

93.7

7910,0

70.8

5988,0

13.4

7979,3

55.7

8823,1

86.5

2985,0

34.2

1876,2

09.3

1960,6

30.2

8

Tota

l R

evenues

13,5

79,4

86.6

914,3

18,9

91.0

914,7

53,6

37.1

814,8

82,5

84.8

615,4

95,2

56.2

215,5

67,6

16.0

616,7

91,5

98.2

616,2

43,1

52.3

316,8

11,3

72.5

817,7

14,1

20.3

8

Exp

en

dit

ure

s

Instr

uction:

Reg

ula

r4,5

25,2

58.3

34,8

14,4

36.7

95,0

47,3

47.1

44,7

58,3

47.7

45,3

03,3

38.8

45,3

82,6

35.5

05,5

16,2

35.1

35,4

70,4

57.1

55,2

72,6

42.2

45,6

71,8

50.1

3

Specia

l 919,4

98.9

7944,4

58.5

9867,2

24.6

4990,9

41.6

01,0

55,3

39.4

51,2

32,1

77.8

01,3

54,1

97.1

21,5

07,5

30.2

31,6

35,9

37.1

61,5

20,5

05.9

3

Oth

er

Specia

l In

str

uction

312,4

90.5

0245,8

30.4

9209,3

66.0

2451,7

50.8

2375,2

22.1

6377,2

04.3

7582,5

98.7

1599,7

26.5

1545,5

76.3

3537,6

60.7

2

School-S

ponsore

d/O

ther

Instr

uctional

106,9

54.4

4105,6

17.3

888,9

66.2

772,8

32.7

680,8

62.3

184,6

24.9

398,9

87.6

184,4

39.1

084,9

89.0

896,7

77.5

9

Support

Serv

ices:

Instr

uction -

Tuitio

n665,2

51.9

8401,7

78.9

0461,2

09.2

3439,8

36.2

4255,1

39.0

3180,9

15.5

8151,8

32.0

5212,7

62.2

5184,2

21.4

7248,5

68.5

6

Stu

dent

& I

nstr

uction R

ela

ted S

erv

ices

1,3

14,7

74.4

31,4

18,7

60.1

21,6

17,7

01.8

11,3

66,1

40.2

71,5

21,7

42.4

81,5

70,5

92.0

11,4

99,5

61.0

71,6

66,3

55.7

01,5

80,3

19.4

91,6

37,1

16.7

0

School A

dm

inis

tration

457,7

15.6

9452,0

33.4

0477,5

14.4

5430,7

17.8

2431,1

94.8

8451,4

99.8

5462,0

62.6

7457,9

68.7

1472,9

88.2

3494,7

40.7

9

Genera

l A

dm

inis

tration

316,5

12.7

5389,3

73.8

3317,7

51.7

6287,8

26.2

4371,6

79.8

3321,8

25.0

4324,3

16.8

2312,2

28.9

8337,0

48.3

3327,5

29.8

1

Centr

al S

erv

ices &

Adm

in.

Info

. T

echnolo

gy

486,0

94.7

4432,2

44.0

5446,3

73.0

4368,2

50.1

4431,6

82.1

2440,5

62.2

6440,8

94.3

6414,1

30.3

6463,1

05.6

2482,5

73.6

4

Opera

tions a

nd M

ain

tenance

874,3

09.2

7837,4

45.9

7817,5

52.1

4872,4

17.7

8681,6

03.7

1859,4

26.0

6879,0

88.9

3828,9

86.4

0844,1

98.5

1801,0

90.7

0

Stu

dent

Tra

nsport

ation

259,8

71.4

7213,7

71.0

8197,4

44.8

1251,4

73.9

1237,4

38.7

6226,5

81.0

8217,0

15.1

9265,6

35.3

6229,7

87.4

8323,4

39.4

4

Em

plo

yee B

enefits

2,2

58,2

18.2

22,5

42,0

26.4

42,6

74,8

97.1

72,9

34,3

72.3

53,4

16,5

13.7

33,2

99,7

33.1

63,8

58,7

84.9

54,3

34,8

08.7

74,9

34,4

58.1

35,3

45,6

66.5

1

Specia

l S

chools

Chart

er

School

3,6

50.0

076,9

03.0

046,4

96.0

0117,5

16.0

0

Capital O

utlay

465,4

14.8

8413,7

15.1

91,3

92,2

67.0

7617,6

21.0

2798,5

27.8

51,6

53,5

05.9

41,8

73,3

82.2

4827,7

86.9

7888,5

04.4

6801,9

99.2

2

Debt

Serv

ice:

Princip

al

160,0

00.0

0160,0

00.0

0160,0

00.0

0160,0

00.0

0160,0

00.0

0

Inte

rest

and O

ther

Charg

es

45,0

00.0

036,0

00.0

027,0

00.0

018,0

00.0

09,0

00.0

0

Tota

l G

overn

menta

l F

und E

xpenditure

s13,1

71,0

15.6

713,4

07,4

92.2

314,8

02,6

15.5

514,0

20,5

28.6

915,1

29,2

85.1

516,0

81,2

83.5

817,2

58,9

56.8

517,0

59,7

19.4

917,5

20,2

72.5

318,4

07,0

35.7

4

Excess (

Deficie

ncy)

of

Revenues

Over

(Under)

Expenditure

s408,4

71.0

2911,4

98.8

6(4

8,9

78.3

7)

862,0

56.1

7365,9

71.0

7(5

13,6

67.5

2)

(467,3

58.5

9)

(816,5

67.1

6)

(708,8

99.9

5)

(692,9

15.3

6)

Oth

er

Fin

an

cin

g S

ou

rces (

Uses)

Opera

ting

Tra

nsfe

rs I

n131,1

35.0

01,4

61,5

00.0

0312,8

60.9

30.1

11,1

15,8

75.0

5231,7

10.5

5

Opera

ting

Tra

nsfe

rs O

ut

(131,1

35.0

0)

(1,4

61,5

00.0

0)

(312,8

60.9

3)

(0.1

1)

(1,1

15,8

75.0

5)

(231,7

10.5

5)

Cancella

tion o

f A

ccounts

Receiv

able

(109,3

10.0

0)

Capital Leases (

non-b

udg

ete

d)

49,1

13.4

0

Tota

l O

ther

Fin

ancin

g S

ourc

es (

Uses)

(109,3

10.0

0)

49,1

13.4

0

Net

Chang

es in F

und B

ala

nce

408,4

71.0

2911,4

98.8

6(4

8,9

78.3

7)

752,7

46.1

7365,9

71.0

7(4

64,5

54.1

2)

(467,3

58.5

9)

(816,5

67.1

6)

(708,8

99.9

5)

(692,9

15.3

6)

Debt

Serv

ice a

s a

perc

enta

ge o

f

noncapital expenditure

s1.6

1%

1.5

1%

1.3

9%

1.3

3%

1.1

8%

So

urc

e: C

AF

R S

ched

ule

B-2

Note

: N

oncapital expenditure

s a

re t

ota

l expenditure

s less c

apital outlay.

-95-

Exhibit J-5


General Fund Other Local Revenue by Source

Last Ten Fiscal Years

Unaudited

Interlocal

Fiscal Year Interest on Agree- Various

Ended June 30, Tuition Investments ments E-Rate Misc. Total

2009 18,653.68 49,620.00 38,305.20 106,578.88

2010 6,989.25 52,240.00 51,705.34 110,934.59

2011 1,395.88 55,380.14 10,128.97 66,904.99

2012 1,346.34 10,862.56 19,689.12 31,898.02

2013 17,500.00 380.95 46,254.11 64,135.06

2014 17,850.00 1,854.70 7,264.46 26,969.16

2015 744.25 69,549.96 70,294.21

2016 173.16 95,451.19 95,624.35

2017 41,197.00 429.01 104,462.05 77,274.56 223,362.62

2018 3,808.50 583.35 79,337.27 39,691.94 123,421.06

Source: District records.

-96-

Ex

hib

it J

-6

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

As

se

ss

ed

an

d E

sti

ma

ted

Ac

tua

l V

alu

e o

f T

ax

ab

le P

rop

ert

y

La

st

Te

n F

isc

al Y

ea

rs

Un

au

dit

ed

Es

tim

ate

d

Ne

t A

ss

es

se

dA

ctu

al (C

ou

nty

To

tal D

ire

ct

Ye

ar

To

tal A

ss

es

se

dP

ub

lic

Uti

liti

es

Va

lua

tio

nE

qu

alize

d)

Sc

ho

ol T

ax

Ra

te

En

de

d D

ec

. 3

1,

Va

ca

nt

La

nd

Re

sid

en

tia

lC

om

me

rcia

lIn

du

str

ial

Ap

art

me

nt

Va

lue

aT

ax

ab

leV

alu

eb

20

08

3,8

50

,10

02

65

,55

9,2

00

36

,98

1,1

00

13

,45

4,8

00

8,5

19

,00

03

28

,36

4,2

00

2,1

07

,17

23

30

,47

1,3

72

72

8,2

89

,99

21

.07

82

20

09

3,7

19

,00

02

69

,21

3,0

00

36

,12

1,1

00

12

,22

5,5

00

8,4

79

,30

03

29

,75

7,9

00

2,0

85

,71

83

31

,84

3,6

18

73

1,4

23

,30

41

.12

51

20

10

3,7

53

,80

02

68

,75

8,2

00

36

,30

5,3

00

12

,22

5,5

00

8,4

79

,30

03

29

,52

2,1

00

2,2

63

,70

03

31

,78

5,8

00

68

6,4

45

,11

51

.21

60

20

11

3,7

69

,40

02

68

,48

2,0

00

36

,68

0,8

00

12

,23

5,3

00

8,4

79

,30

03

29

,64

6,8

00

32

9,6

46

,80

06

52

,80

3,3

90

1.2

98

6

20

12

4,2

61

,70

02

66

,85

5,2

00

36

,20

3,8

00

12

,23

5,3

00

8,4

79

,30

03

28

,03

5,3

00

32

8,0

35

,30

06

16

,79

0,5

75

1.3

09

1

20

13

3,7

23

,50

02

66

,02

4,1

00

35

,89

7,5

00

12

,12

4,5

00

8,4

79

,30

03

26

,24

8,9

00

32

6,2

48

,90

05

81

,27

8,5

10

1.3

54

9

20

14

(A

)5

,72

3,6

00

39

3,0

38

,50

07

7,4

73

,40

02

3,7

67

,20

01

6,9

74

,60

05

16

,97

7,3

00

51

6,9

77

,30

05

32

,57

6,3

89

0.8

31

0

20

15

5,3

85

,60

03

92

,16

0,0

00

77

,02

7,1

00

22

,96

2,7

00

17

,58

6,6

00

51

5,1

22

,00

05

15

,12

2,0

00

53

8,2

82

,43

90

.92

40

20

16

5,3

85

,60

03

90

,92

7,2

00

75

,45

1,0

00

23

,17

1,7

00

18

,01

5,4

00

51

2,9

50

,90

05

12

,95

0,9

00

52

1,5

01

,46

10

.94

40

20

17

5,3

17

,40

03

91

,59

6,8

00

72

,09

4,3

00

23

,11

9,7

00

18

,08

7,3

00

51

0,2

15

,50

05

10

,21

5,5

00

53

7,1

52

,25

60

.99

70

(A

) R

eva

lua

tio

n Y

ea

r

So

urc

e: P

assa

ic C

ou

nty

, A

bstr

act o

f R

ata

ble

s a

nd

Mu

nic

ipa

l T

ax A

sse

sso

r

No

te: R

ea

l p

rop

ert

y is r

eq

uire

d to

be

asse

sse

d a

t so

me

pe

rce

nta

ge

of tr

ue

va

lue

(fa

ir o

r m

ark

et va

lue

) e

sta

blis

he

d b

y e

ach

Co

un

ty B

oa

rd o

f T

axa

tio

n.

R

ea

sse

ssm

en

t o

ccu

rs w

he

n C

ou

nty

Bo

ard

of T

axa

tio

n r

eq

ue

sts

Tre

asu

ry to

ord

er

a r

ea

sse

ssm

en

t.

a

T

axa

ble

Va

lue

of M

ach

ine

ry, Im

ple

me

nts

an

d E

qu

ipm

en

t o

f T

ele

ph

on

e, T

ele

gra

ph

an

d M

esse

ng

er

Syste

m C

om

pa

nie

s.

b

T

ax r

ate

s a

re p

er

$1

00

of a

sse

sse

d v

alu

e.

-97-

Exhibit J-7


Direct and Overlapping Property Tax Rates

Last Ten Fiscal Years

Per $100 of Assessed Valuation

Overlapping Rates

General Total Direct and

Assessment Obligation Local Regional overlapping Tax

Year Basic Ratea

Debt Service b

School District School District Municipality County Rate

2008 1.0782 1.0782 1.6158 1.5166 1.1124 5.3230

2009 1.1251 1.1251 1.6062 1.6419 1.1048 5.4780

2010 1.2160 1.2160 1.6380 1.7950 1.1090 5.7580

2011 1.2986 1.2986 1.6989 1.9033 1.1402 6.0410

2012 1.3091 1.3091 1.7300 1.9649 1.1860 6.1900

2013 1.3549 1.3549 1.7648 2.0535 1.2008 6.3740

2014* 0.8310 0.8310 1.1430 1.3800 0.7250 4.0790

2015 0.9237 0.9237 1.1628 1.4234 0.7943 4.3042

2016 0.9440 0.9440 1.2050 1.4510 0.7610 4.3610

2017 0.9970 0.9970 1.2489 1.4836 0.7755 4.5050

* Revaluation Year

Source: District Records and Municipal Tax Collector.

-98-

Exh

ibit

J-8

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Sch

ed

ule

of

Pri

ncip

al

Taxp

ayers

Cu

rren

t an

d N

ine Y

ears

Ag

o

2017

2008

Taxab

le%

of

Dis

tric

t's

Taxab

le%

of

Dis

tric

t's

Assessed

Ran

kN

et

Assessed

Assessed

Ran

kN

et

Assessed

Taxp

ayer

Valu

eO

pti

on

al

Valu

ati

on

Valu

eO

pti

on

al

Valu

ati

on

Acquakanonk V

illage

11,8

37,0

00

12.3

2%

6,0

23,3

00

11.8

2%

Self S

tora

ge o

f H

ale

don

5,7

02,0

00

31.1

2%

2,1

30,0

00

40.6

4%

Belm

ont

Esta

tes,

LLC

5,3

01,0

00

41.0

4%

A.M

. R

ealty A

ssoc.

4,7

67,5

00

20.9

3%

3,3

53,1

00

21.0

1%

Nationw

ide E

nte

rpri

ses,

LLC

3,4

99,0

00

50.6

9%

1,2

03,8

00

60.3

6%

Bel-

Jo A

ssoc.

LP

3,4

45,0

00

60.6

8%

2,0

90,7

00

50.6

3%

Sto

ne I

ndustr

ies

2,4

47,8

00

70.4

8%

2,8

29,4

00

30.8

6%

Taxpayer

#1

2,3

71,0

00

80.4

6%

C &

P R

ealty

2,2

62,0

00

90.4

4%

Beazer

Hom

es C

orp

.1,8

68,1

00

10

0.3

7%

Faber

Bro

s.

Hold

ings,

LLC

1,1

50,0

00

70.3

5%

Salv

ato

re L

aR

osa

840,0

00

80.2

5%

20 H

als

ey C

orp

800,0

00

90.2

4%

Veri

zon

800,0

00

10

0.2

4%

43,5

00,4

00

8.5

3%

21,2

20,3

00

6.4

2%

-99-

Exhibit J-9


School Tax Levies and Collections

Last Ten Years

Collected within the Fiscal Year

Fiscal Taxes Levied of the Levya

Collections in

Year Ended for the Percentage Subsequent

June 30, Fiscal Year Amount of Levy Years

2009 5,370,794 4,932,309 91.84% 438,485

2010 5,349,419 5,349,419 100.00%

2011 5,567,582 5,567,582 100.00%

2012 5,671,266 4,743,910 83.65% 927,356

2013 5,721,520 5,253,203 91.81% 468,317

2014 5,835,205 4,862,671 83.33% 972,534

2015 5,951,909 5,455,917 91.67% 495,992

2016 6,070,948 5,565,036 91.67% 505,912

2017 6,330,000 5,683,768 89.79% 646,232

2018 6,456,600 6,456,600 100.00% 0

Source: District records including the Certificate and Report of School Taxes (A4F form)

a School Taxes are collected by the Municipal Tax Collector. Under New Jersey Statute,

a municipality is required to remit to the school district the entire property tax balance,

in the amount voted upon or certified prior to the end of the school year.

-100-

Exh

ibit

J-1

0

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Rati

os o

f O

uts

tan

din

g D

eb

t b

y T

yp

e

Last

Ten

Fis

cal Y

ears

Busin

ess-T

ype

Activitie

s

Fis

cal

Year

Ended

June 3

0,

Genera

l

Oblig

ation

Bonds

Cert

ific

ate

s o

f

Part

icip

ation

Capital

Leases

Bond

Anticip

ation

Note

s

(BA

Ns)

Capital Leases

Tota

l D

istr

ict

Perc

enta

ge o

f

Pers

onal

Incom

e a

Per

Capita a

2009

640,0

00.0

0640,0

00.0

00.1

9%

74

2010

480,0

00.0

0480,0

00.0

00.1

4%

58

2011

320,0

00.0

0320,0

00.0

00.1

0%

38

2012

160,0

00.0

0160,0

00.0

00.0

5%

19

2013

0.0

00.0

00.0

0%

2014

0.0

00.0

00.0

0%

2015

0.0

00.0

00.0

0%

2016

0.0

00.0

00.0

0%

2017

0.0

00.0

00.0

0%

2018

0.0

00.0

00.0

0%

No

te:

Deta

ils r

egard

ing the d

istr

ict's

outs

tandin

g d

ebt can b

e f

ound in the n

ote

s to the f

inancia

l sta

tem

ents

.

aS

ee E

xhib

it N

J J

-14 f

or

pers

onal in

com

e a

nd p

opula

tion d

ata

. T

hese r

atios a

re c

alc

ula

ted u

sin

g p

ers

onal in

com

e a

nd

popula

tion f

or

the p

rior

cale

ndar

year.

Govern

menta

l A

ctivitie

s

-101-

Exh

ibit

J-1

1

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Rati

os o

f N

et

Gen

era

l B

on

ded

Deb

t O

uts

tan

din

g

Last

Ten

Fis

cal Y

ears

Fis

cal

Year

Ended

June 3

0,

Genera

l

Oblig

ation

Bonds

Deductions

Net G

enera

l

Bonded D

ebt

Outs

tandin

g

Perc

enta

ge o

f

Actu

al T

axable

Valu

e a

of

Pro

pert

yP

er

Capita b

2009

640,0

00.0

0-

640,0

00.0

00.1

9%

8,4

68

2010

480,0

00.0

0-

480,0

00.0

00.1

4%

8,7

05

2011

320,0

00.0

0-

320,0

00.0

00.1

0%

8,3

31

2012

160,0

00.0

0-

160,0

00.0

00.0

5%

8,3

84

2013

-

0.0

00.0

0%

8,3

96

2014

-

0.0

00.0

0%

8,4

18

2015

0.0

00.0

0%

8,4

39

2016

0.0

00.0

0%

8,4

50

2017

0.0

00.0

0%

8,4

50

2018

0.0

00.0

0%

8,4

63

No

tes:

Deta

ils r

egard

ing the d

istr

ict's o

uts

tandin

g d

ebt can b

e f

ound in the n

ote

s to the f

inancia

l sta

tem

ents

.

aS

ee E

xhib

it N

J J

-6 f

or

pro

pert

y tax d

ata

.

bP

opula

tion d

ata

can b

e f

ound in E

xhib

it N

J J

-14.

Genera

l B

onded D

ebt O

uts

tandin

g

Deductions a

re a

llow

able

for

resourc

es that are

restr

icte

d to r

epayi

ng the p

rincip

al of

debt outs

tandin

g.

-102-

Ex

hib

it J

-12

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Dir

ec

t a

nd

Ove

rla

pp

ing

Go

ve

rnm

en

tal A

cti

vit

ies

De

bt

As

of

Ju

ne

30

, 2

01

8

Go

ve

rnm

en

tal U

nit

De

bt

Ou

tsta

nd

ing

(1)

Estim

ate

d

Pe

rce

nta

ge

Ap

plic

ab

le a

Estim

ate

d

Sh

are

of

Ove

rla

pp

ing

De

bt

De

bt re

pa

id w

ith

pro

pe

rty ta

xe

s

Bo

rou

gh

of

Ha

led

on

9,5

32

,13

0$

10

0.0

00

%9

,53

2,1

30

$

Oth

er

de

bt

Pa

ssa

ic C

ou

nty

Ge

ne

ral O

blig

atio

n D

eb

t3

56

,65

4,8

74

1

.15

06

%4

,10

3,5

34

Pa

ssa

ic C

ou

nty

Utilit

y A

uth

ori

ty5

1,0

80

,00

0

1.1

50

6%

58

7,7

07

Su

bto

tal, o

ve

rla

pp

ing

de

bt

14

,22

3,3

71

Ha

led

on

Sc

ho

ol D

istr

ict

Dir

ec

t D

eb

t-

To

tal d

ire

ct

an

d o

ve

rla

pp

ing

de

bt

14

,22

3,3

71

$

So

urc

es

:A

sse

sse

d v

alu

e d

ata

use

d to

estim

ate

ap

plic

ab

le p

erc

en

tag

es p

rovid

ed

by th

e P

assa

ic C

ou

nty

Bo

ard

of

Ta

xa

tio

n.

De

bt o

uts

tan

din

g d

ata

pro

vid

ed

by e

ach

go

ve

rnm

en

tal u

nit.

No

te:

Ove

rla

pp

ing

go

ve

rnm

en

ts a

re th

ose

th

at co

incid

e, a

t le

ast in

pa

rt, w

ith

th

e g

eo

gra

ph

ic b

ou

nd

ari

es o

f th

e D

istr

ict.

Th

is s

ch

ed

ule

estim

ate

s th

e p

ort

ion

of

the

ou

tsta

nd

ing

de

bt o

f th

ose

ove

rla

pp

ing

go

ve

rnm

en

ts th

at is

bo

rne

by th

e r

esid

en

ts a

nd

bu

sin

esse

s o

f H

ale

do

n. T

his

pro

ce

ss r

eco

gn

ize

s th

at, w

he

n c

on

sid

eri

ng

th

e D

istr

ict's

ab

ility

to

issu

e a

nd

re

pa

y lo

ng

-te

rm d

eb

t, th

e

en

tire

de

bt b

urd

en

bo

rne

by th

e r

esid

en

ts a

nd

bu

sin

esse

s s

ho

uld

be

ta

ke

n in

to a

cco

un

t. H

ow

eve

r th

is d

oe

s n

ot im

ply

th

at

eve

ry ta

xp

aye

r is

a r

esid

en

t, a

nd

th

ere

fore

re

sp

on

sib

le f

or

rep

ayin

g th

e d

eb

t, o

f e

ach

ove

rla

pp

ing

pa

ym

en

t.

aF

or

de

bt re

pa

id w

ith

pro

pe

rty ta

xe

s, th

e p

erc

en

tag

e o

f o

ve

rla

pp

ing

de

bt a

pp

lica

ble

is e

stim

ate

d u

sin

g ta

xa

ble

asse

sse

d p

rop

ert

y v

alu

es.

Ap

plic

ab

le p

erc

en

tag

es w

ere

estim

ate

d b

y d

ete

rmin

ing

th

e p

ort

ion

of

an

oth

er

go

ve

rnm

en

tal u

nit's

ta

xa

ble

va

lue

th

at is

with

in th

e

dis

tric

t's b

ou

nd

ari

es a

nd

div

idin

g it b

y e

ach

un

it's

to

tal ta

xa

ble

va

lue

.

(1)

De

bt In

form

atio

n a

s o

f D

ece

mb

er

31

, 2

01

7.

-103-

Exh

ibit

J-1

3

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Le

ga

l D

eb

t M

arg

in I

nfo

rma

tio

n,

Last

Ten

Fis

cal Y

ears

Le

ga

l D

eb

t M

arg

in C

alc

ula

tio

n f

or

Fis

ca

l Y

ea

r 2

018

Equalized v

alu

ation b

asis

2017

554,8

23,2

93

$

2016

538,2

48,5

83

2015

521,8

53,9

16

[A]

1,6

14,9

25,7

92

$

Avera

ge e

qualized v

alu

ation o

f ta

xable

pro

pert

y[A

/3]

538,3

08,5

97

$

16,1

49,2

58

[C]

16,1

49,2

58

$

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Debt lim

it20,8

14,7

95

$

21,1

61,2

75

$

20,5

45,2

63

$

19,4

87,3

25

$

18,4

92,7

19

$

17,4

21,1

79

$

16,6

30,9

55

$

16,0

28,1

05

$

15,9

83,9

62

$

16,1

49,2

58

$

Tota

l net debt applicable

to lim

it640,0

00

480,0

00

320,0

00

160,0

00

-

-

-

-

-

Legal debt m

arg

in20,1

74,7

95

$

20,6

81,2

75

$

20,2

25,2

63

$

19,3

27,3

25

$

18,4

92,7

19

$

17,4

21,1

79

$

16,6

30,9

55

$

16,0

28,1

05

$

15,9

83,9

62

$

16,1

49,2

58

$

Tota

l net debt applicable

to the lim

it

as a

perc

enta

ge o

f debt lim

it3.0

7%

2.2

7%

1.5

6%

0.8

2%

0.0

0%

0.0

0%

0.0

0%

0.0

0%

0.0

0%

0.0

0%

So

urc

e:

Equalized v

alu

ation b

ases w

ere

obta

ined fro

m the A

nnual R

eport

of th

e S

tate

of N

ew

Jers

ey,

De

pa

rtm

ent

of

Tre

asury

, D

ivis

ion o

f T

axa

tio

n

Fis

cal Y

ear

Debt lim

it (

3 %

of avera

ge e

qualization v

alu

e)

Tota

l N

et D

ebt A

pplicable

to L

imit

L

egal debt m

arg

in

-104-

Exhibit J-14


Demographic and Economic Statistics

Last Ten Years

Personal

Year Ended School District Income in Per Capita Unemployment

December 31, Population (1) Thousands $ (2) Income (3) Rate (4)

2008 8,468 326,890,204 38,603 9.00%

2009 8,705 350,080,280 40,216 16.80%

2010 8,334 330,051,402 39,603 17.10%

2011 8,384 339,040,576 40,439 16.90%

2012 8,396 353,354,056 42,086 16.60%

2013 8,418 360,324,072 42,804 9.00%

2014 8,439 363,889,680 43,120 8.50%

2015 8,450 380,697,850 45,053 6.60%

2016 8,450 395,798,000 46,840 6.50%

2017 8,463 402,390,261 47,547 6.00%

Source: (1) U.S. Bureau of the Census, Population Division,

(Estimates July 1, 2008-2017)

(2) Personal income of the District is based on County Information.

(3) U.S. Department of Commerce, County Information 2007-2016.

(4) N.J. Department of Labor.

-105-

Exhibit J-15


Schedule of Principal Employers

Current and Nine Years Ago

2016 2007

INFORMATION IS NOT AVAILABLE

-106-

Exh

ibit

J-1

6

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Fu

ll-t

ime E

qu

ivale

nt

Dis

tric

t E

mp

loyees b

y F

un

cti

on

/Pro

gra

m,

Last

Ten

Fis

cal Y

ears

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Fu

ncti

on

/Pro

gra

m

Instr

uction

Regula

r70

68

68

68

71

74

80

82.5

80.0

81.0

Specia

l education

13

13

13

15

17

17

17

18.5

21.7

20.0

Oth

er

specia

l education

10

13

13

13

14

14

14

12.8

212.9

13.0

Oth

er

instr

uction

33

33

33

33

Support

Serv

ices:

Stu

dent &

instr

uction r

ela

ted s

erv

ices

14

15

15

15

15

15

15.5

19

20.5

20.5

Genera

l adm

inis

tration

11

11

12

22

1.0

1.0

School adm

inis

trative s

erv

ices

55

55

55

55

5.0

6.0

Centr

al serv

ices

11

11

12

22

1.0

1.0

Adm

inis

trative Info

rmation T

echnolo

gy

11

11

12

22

0.0

0.0

Pla

nt opera

tions a

nd m

ain

tenance

99

99

99

98.5

9.5

9.0

Pupil

transport

ation

22

22

22

22

1.5

1.5

Oth

er

support

serv

ices

34

44

44

44

4.0

1.0

Food S

erv

ice

55

66

66

65

6.0

6.0

Child

Care

66

66

66

10

14.6

15.5

18.5

Tota

l143

146

147

149

155

161

171.5

180.9

2178.6

3178.5

0

So

urc

e:

Dis

tric

t P

ers

onnel R

ecord

s

-107-

Exh

ibit

J-1

7

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Op

era

tin

g S

tati

sti

cs,

Last

Ten

Fis

cal

Years

Pupil/

Teacher

Ratio

Fis

cal

Year

En

roll

men

t

a

Exp

en

dit

ure

sC

ost

Per

Pu

pil

% C

han

ge

b

Teach

ing

Sta

ffE

lem

en

tary

Avera

ge

Dail

y

En

roll

men

t

c

A

vera

ge

Dail

y

Att

en

dan

ce

% C

han

ge

in A

vera

ge

Dail

y

En

roll

men

t

Stu

den

t

Att

en

dan

ce

Perc

en

tag

e

2008-2

009

1046

12,5

00,6

00.7

911,9

50.8

66.3

2%

83

12.6

1046

988.0

0-3

.77%

94.4

6%

2009-2

010

1052

12,7

97,7

77.0

412,1

65.1

91.7

9%

81

13.0

1052

998.0

00.5

7%

94.8

7%

2010-2

011

1039

13,2

23,3

48.4

812,7

27.0

04.6

2%

81

12.8

1039

982.6

0-1

.24%

94.5

7%

2011-2

012

1037

13,3

83,3

07.6

712,9

05.7

91.4

0%

83

12.5

1037

987.3

1-0

.19%

95.2

1%

2012-2

013

1004

14,1

61,7

57.3

014,1

05.3

49.2

9%

88

11.4

1004

953.4

0-3

.18%

94.9

6%

2013-2

014

1018

14,4

27,7

77.6

414,1

72.6

70.4

8%

91

11.2

1018

960.7

41.3

9%

94.3

8%

2014-2

015

1029

15,3

85,5

74.6

114,9

51.9

75.5

0%

97

10.6

1029

971.8

01.0

8%

94.4

4%

2015-2

016

1050

16,2

31,9

32.5

215,4

58.9

83.3

9%

100.5

10.4

1050

976.8

72.0

4%

93.0

4%

2016-2

017

1041

16,6

31,7

68.0

715,9

76.7

23.3

5%

80

13.0

1041

983.7

8-0

.86%

94.5

0%

2017-2

018

1039

17,6

05,0

36.5

216,9

44.2

16.0

6%

101

10.3

1039

944.0

0-0

.19%

90.8

6%

Sourc

es:

Dis

tric

t R

ecord

s

Note

: E

nro

llment

based o

n a

nnual O

cto

ber

dis

tric

t count.

a-O

pera

ting E

xpenditure

s e

qual to

tal expenditure

s less d

ebt

serv

ice a

nd c

apital outlay.

b-T

eachin

g s

taff

inclu

des o

nly

full-

tim

e e

quiv

ale

nts

of

cert

ific

ate

d s

taff

.

c-A

vera

ge d

aily

enro

llment

and a

vera

ge d

aily

att

endance a

re o

bta

ined f

rom

the S

chool R

egis

ter

Sum

mary

.

-108-

Exh

ibit

J-1

8

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Sch

oo

l B

uild

ing

In

form

ati

on

Last

Ten

Fis

cal Y

ears

Dis

tric

t B

uild

ing

s2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Ele

menta

ry

Hale

don S

chool

S

quare

Feet

102,9

69

102,9

69

102,9

69

102,9

69

107,6

63

107,6

63

107,6

63

107,6

63

107,6

63

107,6

63

C

apacity(

stu

dents

)764

764

764

764

994

994

994

994

994

994

E

nro

llment

1,0

32

1,0

52

1,0

50

1,0

37

1,0

12

1,0

25

1,0

30

1,0

51

1,0

41

1,0

39

Num

ber

of

Schools

at June 3

0, 2018

Ele

menta

ry=

1

Sourc

e: D

istr

ict F

acili

ties O

ffic

e

-109-

J-1

9

BO

RO

UG

H O

F H

AL

ED

ON

SC

HO

OL

DIS

TR

ICT

Ge

ne

ral

Fu

nd

Sc

he

du

le o

f R

eq

uir

ed

Ma

inte

na

nc

e f

or

Sc

ho

ol

Fa

cil

itie

s

Fo

r th

e F

isc

al

Ye

ar

En

de

d J

un

e 3

0,

UN

DIS

TR

IBU

TE

D E

XP

EN

DIT

UR

ES

- R

EQ

UIR

ED

MA

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-110-

Exhibit J-20


Insurance Schedule

June 30, 2018

Coverage Deductible

School Package Policy - Suburban Essex JIF

Reinsurer: Selective Insurance Company

Property - Blanket Limit of JIF 500,000

Member Limit: 27,945,870 5,000

Owner Group Retention: 100,000 p/occurrence

Owner Group District Deductible: 500 p/occurrence

Comprehensive General Liability (per occurrence) 16,000,000

Employee Benefits Liability (per occurrence) 16,000,000

Comprehensive Automobile Liability (per occurrence) 16,000,000

School Leaders Errors & Omissions

A C E American Insurance Company 16,000,000 p/district

Owner Group District Deductible: None

Workers Compensation 10,000

Suburban Essex JIF

Limit of Liability WC Statutory

EL 11,000,000

Public Employees' Faithful Performance Bond 500,000 1,000

Owner Group District Deductible: 0

Public Employees' Faithful Performance

Position Bond

Treasurer of School Moneys 100,000

Travelers Insurance Co.

Board Secretary/Business Administrator 100,000

Travelers Insurance Co.

-111-

SINGLE AUDIT SECTION


K-1 Page 1 of 2

INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVERFINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS

BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED INACCORDANCE WITH GOVERNMENT AUDITING STANDARDS


We have audited, in accordance with auditing standards generally accepted in the United States ofAmerica; audit requirements as prescribed by the Office of School Finance, Department ofEducation, State of New Jersey; and the standards applicable to financial audits contained inGovernment Auditing Standards, issued by the Comptroller General of the United States, thefinancial statements of the governmental activities, the business-type activities and each major fundand the aggregate remaining fund information of the Board of Education of the Borough of HaledonSchool District, in the County of Passaic, New Jersey, as of and for the year ended June 30, 2018,and the related notes to the financial statements, which collectively comprise the District’s basicfinancial statements, and have issued our report thereon dated January 22, 2019.

Internal Control Over Financial Reporting

In planning and performing our audit on the financial statements, we considered the Borough ofHaledon Board of Education’s internal control over financial reporting (internal control) todetermine the audit procedures that are appropriate in the circumstances for the purpose ofexpressing our opinions on the financial statements, but not for the purpose of expressing an opinionon the effectiveness of the Borough of Haledon Board of Education’s internal control. Accordingly,we do not express an opinion on the effectiveness of the Borough of Haledon Board of Education’sinternal control.

A deficiency in internal control exists when the design or operation of a control does not allowmanagement or employees, in the normal course of performing their assigned functions, to prevent,or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or acombination of deficiencies, in internal control, such that there is a reasonable possibility that amaterial misstatement of the entity’s financial statements will not be prevented, or detected and

-112-

Honorable President and K-1Members of the Board of Education Page 2 of 2

corrected on a timely basis. A significant deficiency is a deficiency, or a combination ofdeficiencies, in internal control that is less severe than a material weakness, yet important enough tomerit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph ofthis section and was not designed to identify all deficiencies in internal control that might bematerial weaknesses or significant deficiencies. Given these limitations, during our audit we did notidentify any deficiencies in internal control that we consider to be material weaknesses. However,material weaknesses may exist that have not been identified.

Compliance and Other Matters

As part of obtaining reasonable assurance about whether the Borough of Haledon Board ofEducation’s financial statements are free of material misstatement, we performed tests of itscompliance with certain provisions of laws, regulations, contracts and grant agreements,noncompliance with which could have a direct and material effect on the determination of financialstatement amounts. However, providing an opinion on compliance with those provisions was not anobjective of our audit and, accordingly, we do not express such an opinion. The results of our testsdisclosed no instances of noncompliance or other matters that are required to be reported underGovernment Auditing Standards or the audit requirements as prescribed by the Office of SchoolFinance, Department of Education, State of New Jersey.

We noted certain matters that were required to be reported to the Board of Education of the Boroughof Haledon School District in the separate Auditors’ Management Report on AdministrativeFindings - Financial, Compliance and Performance dated January 22, 2019.

Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control andcompliance and the results of that testing, and not to provide an opinion on the effectiveness of theentity’s internal control or on compliance. This report is an integral part of an audit performed inaccordance with Government Auditing Standards in considering the entity’s internal control andcompliance. Accordingly, this communication is not suitable for any other purpose.



January 22, 2019

James Cerullo


-113-


K-2 Page 1 of 3

INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJORPROGRAM AND REPORT ON INTERNAL CONTROL OVER

COMPLIANCE AS REQUIRED BY THE UNIFORM GUIDANCEAND N.J. OMB CIRCULAR 15-08


Report on Compliance for Each Major Federal and State Program

We have audited the Board of Education of the Borough of Haledon School District in the County ofPassaic, New Jersey, compliance with the types of compliance requirements described in the OMBCompliance Supplements and the New Jersey State Aid/Grant Compliance Supplement that couldhave a direct and material effect on each of the Borough of Haledon Board of Education’s majorfederal and state programs for the year ended June 30, 2018. The Borough of Haledon Board ofEducation’s major federal and state programs are identified in the summary of auditor’s resultssection of the accompanying schedule of findings and questioned costs.

Management’s Responsibility

Management is responsible for compliance with the requirements of laws, regulations, contracts, andgrants applicable to its federal and state programs.

Auditor’s Responsibility

Our responsibility is to express an opinion on compliance for each of the Borough of Haledon Boardof Education’s major federal and state programs based on our audit of the types of compliancerequirements referred to above. We conducted our audit of compliance in accordance with auditingstandards generally accepted in the United States of America; the standards applicable to financialaudits contained in Government Auditing Standards, issued by the Comptroller General of theUnited States; and Title 2 U.S. Code of Federal Regulations Part 200, Uniform AdministrativeRequirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance)and N.J. OMB Circular 15-08. Those standards, the Uniform Guidance and N.J. OMB Circular 15-08 require that we plan and perform the audit to obtain reasonable assurance about whether

-114-


noncompliance with the types of compliance requirements referred to above that could have a directand material effect on a major federal and state program occurred. An audit includes examining, ona test basis, evidence about the Borough of Haledon Board of Education’s compliance with thoserequirements and performing such other procedures as we considered necessary in thecircumstances.

We believe that our audit provides a reasonable basis for our opinion on compliance for each majorfederal and state program. However, our audit does not provide a legal determination of theBorough of Haledon Board of Education’s compliance.

Opinion on Each Major Federal and State Program

In our opinion, the Borough of Haledon Board of Education complied, in all material respects, withthe types of compliance requirements referred to above that could have a direct and material effecton each of its major federal and state programs for the year ended June 30, 2018.

Report on Internal Control Over Compliance

Management of the Borough of Haledon Board of Education is responsible for establishing andmaintaining effective internal control over compliance with the types of compliance requirementsreferred to above. In planning and performing our audit of compliance, we considered the Boroughof Haledon Board of Education’s internal control over compliance with the type of requirements thatcould have a direct and material effect on each major federal and state program to determine theauditing procedures that are appropriate in the circumstances for the purpose of expressing anopinion on compliance for each major federal and state program and to test and report on internalcontrol over compliance in accordance with the Uniform Guidance and N.J. OMB Circular 15-08,but not for the purpose of expressing an opinion on the effectiveness of internal control overcompliance. Accordingly, we do not express an opinion on the effectiveness of Borough of HaledonBoard of Education’s internal control over compliance.

A deficiency in internal control over compliance exists when the design or operation of a controlover compliance does not allow management or employees, in the normal course of performing theirassigned functions, to prevent, or detect and correct, noncompliance with a type of compliancerequirement of a federal and state program on a timely basis. A material weakness in internalcontrol over compliance is a deficiency, or combination of deficiencies, in internal control overcompliance, such that there is a reasonable possibility that material noncompliance with a type ofcompliance requirement of a federal and state program will not be prevented, or detected andcorrected, on a timely basis. A significant deficiency in internal control over compliance is adeficiency, or a combination of deficiencies, in internal control over compliance with a type ofcompliance requirement of a federal and state program that is less severe than a material weaknessin internal control over compliance, yet important enough to merit attention by those charged withgovernance.

-115-


Our consideration of internal control over compliance was for the limited purpose described in thefirst paragraph of this section and was not designed to identify all deficiencies in internal controlover compliance that might be material weaknesses or significant deficiencies. We did not identifyany deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

The purpose of this report on internal control over compliance is solely to describe the scope of ourtesting of internal control over compliance and the results of that testing based on the requirementsof the Uniform Guidance and N.J. OMB Circular 15-08. Accordingly, this report is not suitable forany other purpose.



January 22, 2019


James Cerullo

-116-

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K-4

-118-

Borough of Haledon School District K-5Notes to the Schedules of Expenditures of Federal Awards and Page 1 of 3 State Financial Assistance June 30, 2018

NOTE 1. GENERAL

The accompanying Schedules of Expenditures of Federal Awards and State Financial Assistance include theactivity of all federal and state award programs of the Board of Education, Borough of Haledon SchoolDistrict. The Board of Education is defined in Note 1 to the Board's basic financial statements. All federaland state awards received directly from federal and state agencies, as well as federal and state awards passedthrough other government agencies is included on the Schedules of Expenditures of Federal Awards and StateFinancial Assistance.

NOTE 2. BASIS OF ACCOUNTING

The accompanying Schedules of Expenditures of Federal Awards and State Financial Assistance are presentedon the budgetary basis of accounting with the exception of programs recorded in the food service fund, whichare presented using the accrual basis of accounting. These bases of accounting are described in Notes 1(D)and 1(E) to the Board's basic financial statements. The information in these schedules is presented inaccordance with the requirements of 2 CFR 200-Uniform Administrative Requirements, Cost Principles, andAudit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ inamounts presented in or used in the preparation of the basic financial statements.

NOTE 3. RELATIONSHIP TO BASIC FINANCIAL STATEMENTS

The basic financial statements present the general fund and the special revenue fund on a GAAP basis. Budgetary comparison statements or schedules (RSI) are presented for the general fund and special revenuefund to demonstrate finance-related legal compliance in which certain revenue is permitted by law or grantagreement to be recognized in the audit year, whereas for GAAP reporting, revenue is not recognized untilthe subsequent year or when expenditures have been made.

The general fund is presented in the accompanying schedules on the modified accrual basis with the exceptionof the revenue recognition of the last state aid payment in the current budget year, which is mandated pursuantto N.J.S.A. 18A:22-44.2. For GAAP purposes, that payment is not recognized until the subsequent budgetyear due to the state deferral and recording of the last state aid payment in the subsequent year. The specialrevenue fund is presented in the accompanying schedules on the grant accounting budgetary basis whichrecognizes encumbrances as expenditures and also recognizes the related revenues, whereas the GAAP basisdoes not. The special revenue fund also recognizes the last state aid payment in the current budget year,consistent with N.J.S.A. 18A:22-44.2.

-119-

Borough of Haledon School District K-5Notes to the Schedules of Expenditures of Federal Awards and Page 2 of 3 State Financial AssistanceJune 30, 2018

NOTE 3. RELATIONSHIP TO BASIC FINANCIAL STATEMENTS, (continued)

The net adjustment to reconcile from the budgetary basis to the GAAP basis is $(26,454.00) for areconciliation of the budgetary basis to the modified accrual basis of accounting for the general and specialrevenue funds. Awards and financial assistance revenues are reported in the Board’s financial statements ona GAAP basis as follows:

Federal State Total

General Fund $22,149.28 $9,580,089.58 $9,602,238.86Special Revenue Fund 925,731.00 589,326.37 1,515,057.37Food Service Fund 549,601.69 7,935.52 557,537.21Total Awards and Financial $1,497,481.97 $10,177,351.47 $11,674,833.44

NOTE 4. RELATIONSHIP TO FEDERAL AND STATE FINANCIAL REPORTS

Amounts reported in the accompanying schedules agree with the amounts reported in the related federal andstate financial reports.

NOTE 5. OTHER

Revenues and expenditures reported under the Food Distribution Program represent current year valuereceived and current year distributions, respectively. The amount reported as TPAF Pension Contributionsrepresents the amount paid by the state on behalf of the District for the year ended June 30, 2018. The amountreported as TPAF Social Security Contributions represents the amount reimbursed by the state for theemployer's share of social security contributions for TPAF members for the year ended June 30, 2018.

NOTE 6. ON-BEHALF PROGRAMS NOT SUBJECT TO STATE SINGLE AUDIT

On-behalf State Programs for TPAF Pension and Post-Retirement Medical Benefits Contributions are notsubject to a State single audit and, therefore, are excluded from major program determination. The Scheduleof State Financial Assistance provides a reconciliation of State financial assistance reported in the District’sfinancial statements and the amounts subject to State single audit and major program determination.

NOTE 7. INDIRECT COST RATE

The Borough of Haledon School District has elected not to use the 10-percent de minimis indirect cost rateas allowed under the Uniform Guidance.

-120-

Borough of Haledon School District K-5Notes to the Schedules of Expenditures of Federal Awards and Page 3 of 3 State Financial AssistanceJune 30, 2018

NOTE 8. SCHOOLWIDE PROGRAM FUNDS

Schoolwide programs are not separate federal programs as defined in Uniform Administrative Requirements,Cost Principles, and Audit Requirements for Federal Awards (Uniform Grant Guidance); amounts used inschoolwide programs are included in the total expenditures of the program contributing the funds in theSchedule of Expenditures of Federal Awards. The following funds by program are included in schoolwideprograms in the school district:

Program Total

Title I, Part A: Grants to Local Educational Agencies $575,022.00Title II, Part A: Improving Teacher Quality State Grants 57,724.00Title III: English Language Acquisition State Grants 13,913.00

Total $646,659.00

-121-

K-6Page 1 of 2

BOROUGH OF HALEDON SCHOOL DISTRICTSCHEDULE OF FINDINGS AND QUESTIONED COSTS

FOR THE FISCAL YEAR ENDED JUNE 30, 2018

Section I - Summary of Auditor’s Results

Financial Statements

Type of auditor’s report issued: unmodified

Internal control over financial reporting:

1. Material weakness(es) identified? yes X no

2. Significant deficiencies identified that arenot considered to be material weaknesses? yes X none reported

Noncompliance material to basic financialstatements noted? yes X no

Federal Awards

Internal Control over major programs:


2. Significant deficiencies identified that are not considered to be material weaknesses? yes X none reported

Type of auditor’s report issued on compliance for major programs: unmodified

Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200 section .516(a) of theUniform Guidance? yes X no

Identification of major programs:

CFDA Number(s) FAIN Number(s) Name of Federal Program or Cluster

84.010 S010A170030 Title I

Dollar threshold used to distinguish between type A and type B programs: $750,000

Auditee qualified as low-risk auditee? X yes no

-122-

K-6Page 2 of 2

BOROUGH OF HALEDON SCHOOL DISTRICTSCHEDULE OF FINDINGS AND QUESTIONED COSTS

FOR THE FISCAL YEAR ENDED JUNE 30, 2018(continued)

State Awards

Dollar threshold used to distinguish between type A and type B programs: $ 750,000

Auditee qualified as low-risk auditee? X yes no

Type of auditor’s report issued on compliance for major programs: unmodified

Internal Control over major programs:


2. Significant deficiencies identified that are not considered to be material weaknesses? yes X none reported

Any audit findings disclosed that are required to be reported in accordance with NJ OMB Circular Letter 15-08? yes X no

Identification of major programs:

State Grant/Project Number(s) Name of State Program

Cluster - State Aid – Public: 18-495-034-5120-078 Equalization Aid 18-495-034-5120-089 Special Education Aid 18-495-034-5120-084 Security Aid 18-495-034-5120-096 Under Adequacy Aid 18-495-034-5120-097 Per Pupil Growth Aid 18-495-034-5120-098 PARCC Readiness 18-495-034-5120-101 Professional Learning Community Aid

-123-

K-7

BOROUGH OF HALEDON SCHOOL DISTRICTSCHEDULE OF FINANCIAL, FEDERAL AND STATE FINDINGS


Section II - Financial Statement Findings

None

Section III - Federal Awards and State Financial Assistance Findings and Questioned Costs

None

-124-

K-8

BOROUGH OF HALEDON SCHOOL DISTRICTSUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS


Status of Prior Year Findings

There were no prior year findings.

-125-

school district of the borough of haledon county of ... · january 22, 2019 citizens, honorable...

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