The institution has a sound financial base, demonstrated financial stability, and adequate physical resources to support the mission of the institution and the scope of its programs and services.

The member institution provides the following financial statements:

(a) an institutional audit (or Standard Review Report issued in accordance with Statements on Standards for Accounting and Review Services issued by the AICPA for those institutions audited as part of a systemwide or statewide audit) and written institutional management letter for the most recent fiscal year prepared by an independent certified public accountant and/or an appropriate governmental auditing agency employing the appropriate audit (or Standard Review Report guide;

(b) a statement of financial position of unrestricted net assets, exclusive of plant assets and plant-related debt, which represents the change in unrestricted net assets attributable to operations for the most recent year; and

(c) an annual budget that is preceded by sound planning, is subject to sound fiscal procedures, and is approved by the governing board.

Southwestern Community College can demonstrate its sound financial base, financial stability, and adequate physical resources to support its programs, services, and mission.

The financial support of the College comes primarily from state dollars as provided for by the North Carolina General Assembly and distributed by the North Carolina Community College System (NCCCS) (1). Southwestern is one of fifty-eight colleges in the NCCCS that receives funding as required by North Carolina General Statutes (2). The law authorizes the state Board of Community Colleges to provide funds to meet the financial needs of institutions in the system, which include plant funds, current operating funds, and additional support. State fund appropriations are based on full time equivalent (FTE) enrollment (3). In addition, as required by general statute, the College receives county funding that primarily supports the operation of plant and facilities (4). There is also an affiliated foundation, The Southwestern Community College Foundation, Inc., which provides the College some financial assistance to support student scholarships, learning resource and instructional materials and equipment, opportunities for employee development, and facilities renovation and capital improvements. The mission of the Foundation is to support, strengthen and further the mission of the College. The Foundation provided $230,118 to the College for both restricted and unrestricted purposes in FY 2004-2005. The College also receives funds from voter-approved community college bond referendums.

The College’s financial records are submitted to the North Carolina Office of State Controller and independently audited by the North Carolina Office of State Auditor as mandated by the state (5). Audit reports have consistently found the College to be in compliance with no significant deficiencies in internal control over financial reporting and no instances of noncompliance. The College’s four most recent audits and/or reviews demonstrate its financial stability to support its programs and services (6, 7, 8, 9). The College’s financial statements demonstrate the stability of its unrestricted net assets (10, 11, 12, 13). As presented in The Statement of Cash Flows for fiscal years 2002-2005, SCC has successfully met its financial obligations (14, 15, 16, 17).

SCC physical resources are adequate to support the mission and scope of its programs and services. The facilities at all locations are well maintained and attractive (18). An annual survey of faculty, staff, and students reflects high satisfaction with the appearance and adequacy of physical resources of the College (19, 20). The NCCCS requires the preparation of a Facilities Utilization report annually (21). This report provides statistical data for use in facilities planning. In 2004, SCC had 112 square feet of academic facilities per FTE student. The NCCCS average was 89 square feet.

The College develops its annual budget as part of the institution-wide planning process. Each service and program area of the College completes a planning/outcomes document for the coming year. This process provides for ongoing operations and expansion budget requests. Curriculum programs develop their plans in two phases. During the spring and summer, budget hearings are scheduled for each curriculum program in order to better align requests with budget allocations. Budget needs are included in the annual planning process that begins each August at the start of fall semester (22, 23, 24, 25).

The annual College budget (26), including funds provided by the state and service counties, is approved by the Board of Trustees (27).