MONTHLY FINANCIAL REPORT (unaudited)

Transcription

1 T HE U NIVERSITY OF T EXAS S YSTEM O FFICE OF THE C ONTROLLER MONTHLY FINANCIAL REPORT (unaudited) NOVEMBER Seventh Street, ASH 5 th Floor Austin, Texas

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3 THE UNIVERSITY OF TEXAS SYSTEM MONTHLY FINANCIAL REPORT (Unaudited) FOR THE THREE MONTHS ENDING 30, 2015

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5 TABLE OF CONTENTS FOREWORD... 7 SYSTEMWIDE COMPARISONS OF ACTUAL... 9 YEAR-TO-DATE INCOME (LOSS) SUMMARY BY INSTITUTION EXPLANATIONS OF VARIANCES GLOSSARY OF TERMS U. T. SYSTEM ADMINISTRATION U. T. ARLINGTON U. T. AUSTIN U. T. BROWNSVILLE U. T. DALLAS U. T. EL PASO U. T. PERMIAN BASIN U. T. RIO GRANDE VALLEY U. T. SAN ANTONIO U. T. TYLER U. T. SOUTHWESTERN MEDICAL CENTER U. T. MEDICAL BRANCH - GALVESTON U. T. HEALTH SCIENCE CENTER - HOUSTON U. T. HEALTH SCIENCE CENTER - SAN ANTONIO U. T. M. D. ANDERSON CANCER CENTER U. T. HEALTH SCIENCE CENTER - TYLER... 31

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7 The University of Texas System Monthly Financial Report Foreword The Monthly Financial Report (MFR) compares the results of operations between the current year-todate cumulative amounts and the prior year-to-date cumulative amounts. Explanations are provided for institutions having the largest variances in Adjusted Income (Loss) year-to-date as compared to the prior year, both in terms of dollars and percentages. In addition, although no significant variance may exist, institutions with losses may be discussed. The data is reported in three sections: (1), (2), and (3) Other Nonoperating Adjustments. Presentation of state appropriation revenues are required under GASB 35 to be reflected as nonoperating revenues, so all institutions will report an Operating Loss prior to this adjustment. The MFR provides an Adjusted Income (Loss), which takes into account the nonoperating adjustments associated with core operating activities. An Adjusted Margin (as a percentage of operating and nonoperating revenue adjustments) is calculated for each period and is intended to reflect relative operating contributions to financial health. 7

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9 The University of Texas System Consolidated For the Period Ending 30, 2015 Net Student Tuition and Fees 410,022, ,312, ,710, % Sponsored Programs 758,511, ,425, ,085, % Net Sales and Services of Educational Activities 170,470, ,401, ,068, % Net Sales and Services of Hospitals 1,364,468, ,252,313, ,154, % Net Professional Fees 408,012, ,615, ,397, % Net Auxiliary Enterprises 168,181, ,688, ,492, % Other 81,035, ,767, (33,732,290.15) -29.4% Total 3,360,701, ,119,523, ,177, % Salaries and Wages 1,972,122, ,802,545, ,576, % Payroll Related Costs 499,691, ,874, ,817, % Cost of Goods Sold 37,101, ,134, ,967, % Professional Fees and Services 111,694, ,204, ,489, % Other Contracted Services 198,067, ,614, ,452, % Travel 37,092, ,913, ,178, % Materials and Supplies 439,304, ,130, ,173, % Utilities 76,848, ,995, ,853, % Communications 25,356, ,410, (13,053,749.89) -34.0% Repairs and Maintenance 79,685, ,518, ,167, % Rentals and Leases 43,042, ,811, ,230, % Printing and Reproduction 9,071, ,515, , % Bad Debt Expense 373, , , % Claims and Losses 3,550, ,168, (10,617,244.36) -74.9% Increase in Net OPEB Obligation 166,710, ,967, ,743, % Pension Expense 53,223, ,223, % Scholarships and Fellowships 90,859, ,628, ,231, % Depreciation and Amortization 313,193, ,697, ,496, % Federal Sponsored Program Pass-Through to Other State Agencies 5,443, ,233, ,209, % State Sponsored Program Pass-Through to Other State Agencies 1,129, ,325, (195,404.74) -14.7% Other 123,312, ,318, ,993, % Total 4,286,877, ,879,232, ,645, % Operating Loss (926,176,204.40) (759,708,794.56) (166,467,409.84) -21.9% State Appropriations 559,749, ,008, ,740, % Nonexchange Sponsored Programs 59,692, ,465, ,227, % Gift Contributions for Operations 102,792, ,567, ,224, % Net Investment Income 153,445, ,118, (37,672,868.59) -19.7% Interest Expense on Capital Asset Financings (69,148,783.78) (71,936,088.72) 2,787, % Net 806,530, ,224, ,306, % Adjusted Income (Loss) including Depreciation & Amortization (119,645,647.19) (26,484,788.80) (93,160,858.39) % Adjusted Margin % including Depreciation & Amortization -2.8% -0.7% Investment Gain (Losses) (349,617,597.61) (410,909,904.40) 61,292, % Adj. Inc. (Loss) with Investment Gains (Losses) (469,263,244.80) (437,394,693.20) (31,868,551.60) -7.3% Adj. Margin % with Investment Gains (Losses) -12.1% -12.4% Adjusted Income (Loss) excluding Depreciation & Amortization 193,548, ,212, (60,664,432.45) -23.9% Adjusted Margin % excluding Depreciation & Amortization 4.6% 6.5% 9

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11 The University of Texas System Comparison of Adjusted Income (Loss) For the Three Months Ending 30, 2015 Including Depreciation and Amortization Expense U. T. System Administration $ (298,423,248.00) $ (148,874,683.18) (149,548,564.82) (1) % U. T. Arlington 6,596, ,358, (2,761,443.07) (2) -29.5% U. T. Austin 63,688, ,498, ,190, (3) 46.4% U. T. Brownsville (188,567.11) (2,087,791.32) 1,899, (4) 91.0% U. T. Dallas 7,980, ,520, ,459, (5) 216.6% U. T. El Paso (3,506,912.32) (6) (3,345,701.09) (161,211.23) -4.8% U. T. Permian Basin (1,695,149.37) (4,211,094.93) 2,515, (7) 59.7% U. T. Rio Grande Valley 5,819, ,819, % U. T. San Antonio 1,729, ,968, (239,080.27) -12.1% U. T. Tyler (2,773,289.06) (8) (3,083,988.85) 310, % U. T. Southwestern Medical Center 23,962, ,193, ,769, (9) 192.5% U. T. Medical Branch - Galveston 4,299, ,180, (14,880,664.57) (10) -77.6% U. T. Health Science Center - Houston 19,662, ,520, ,142, (11) 1,193.1% U. T. Health Science Center - San Antonio 6,691, ,376, (7,684,514.95) (12) -53.5% U. T. M. D. Anderson Cancer Center 121,798, ,760, ,038, % U. T. Health Science Center - Tyler (5,086,621.82) (13) (4,195,651.42) (890,970.40) -21.2% Elimination of AUF Transfer (70,203,000.00) (66,062,500.00) (4,140,500.00) -6.3% Total Adjusted Income (Loss) (119,645,647.19) (26,484,788.80) (93,160,858.39) % Investment Gains (Losses) (349,617,597.61) (410,909,904.40) 61,292, % Total Adjusted Income (Loss) with Investment Gains (Losses) Including Depreciation and Amortization $ (469,263,244.80) $ (437,394,693.20) $ (31,868,551.60) -7.3% Excluding Depreciation and Amortization Expense U. T. System Administration $ (293,851,888.17) $ (145,348,716.85) (148,503,171.32) % U. T. Arlington 18,040, ,560, (2,519,658.14) -12.3% U. T. Austin 127,438, ,498, ,940, % U. T. Brownsville (36,358.00) 45, (82,217.12) % U. T. Dallas 22,811, ,881, ,929, % U. T. El Paso 4,353, ,827, , % U. T. Permian Basin 1,796, (953,445.74) 2,749, % U. T. Rio Grande Valley 15,373, ,373, % U. T. San Antonio 13,661, ,341, , % U. T. Tyler 630, , , % U. T. Southwestern Medical Center 63,238, ,235, ,002, % U. T. Medical Branch - Galveston 30,894, ,124, (13,229,837.04) -30.0% U. T. Health Science Center - Houston 34,913, ,375, ,537, % U. T. Health Science Center - San Antonio 19,941, ,501, (7,559,514.95) -27.5% U. T. M. D. Anderson Cancer Center 206,924, ,427, ,496, % U. T. Health Science Center - Tyler (2,378,757.85) (1,446,808.49) (931,949.36) -64.4% Elimination of AUF Transfer (70,203,000.00) (66,062,500.00) (4,140,500.00) -6.3% Total Adjusted Income (Loss) 193,548, ,212, (60,664,432.45) -23.9% Total Adjusted Income (Loss) Excluding Depreciation and Amortization $ 193,548, $ 254,212, $ (60,664,432.45) -23.9% 11

12 THE UNIVERSITY OF TEXAS SYSTEM EXPLANATION OF VARIANCES ON THE MONTHLY FINANCIAL REPORT For the Three Months Ending 30, 2015 Explanations are provided for institutions having the largest variances in adjusted income (loss) year-to-date as compared to the prior year, both in terms of dollars and percentages. Explanations are also provided for institutions with a current year-to-date adjusted loss and/or a projected year-to-date loss. (1) U. T. System Administration The $149.5 million (100.5%) increase in adjusted loss over the same period last year was primarily due to a decrease in oil and gas royalties, which are a component of net investment income. Additionally, GASB Statement No. 68, Accounting and Financial Reporting for Pensions, became effective in U. T. System Administration recognized an accrual of $53.2 million for the entire U. T. System for the first three months of 2016; however, in 2015 the pension expense was not recognized until July. Also contributing to the increase in the adjusted loss was an increase of $26.7 million in the accrual for Other Postemployment Benefits (OPEB) expense for the entire U. T. System. U. T. System Administration incurred a year-to-date loss of $298.4 million as a result of these factors. Excluding depreciation and amortization expense, U. T. System Administration s adjusted loss was $293.9 million or -1,369.2% of revenues. U. T. System Administration anticipates ending the year with a $1.1 billion loss, % of projected revenues, and includes $18.3 million of depreciation and amortization expense, as well as a $666.8 million accrual for OPEB and a $212.9 million accrual for pension expense. (2) U. T. Arlington The $2.8 million (29.5%) decrease in adjusted income over the same period last year was primarily attributable to an increase in salaries and wages and payroll related costs as a result of a 4% merit pool increase and increased premium sharing rates. Excluding depreciation and amortization expense, U. T. Arlington s adjusted income was $18.0 million or 12.5% of revenues. (3) U. T. Austin The $20.2 million (46.4%) increase in adjusted income over the same period last year was primarily attributable to an increase in gift contributions for operations due to increased gift pledges including an $8.3 million pledge from Houston Endowment Inc. and an increase in state appropriations. Excluding depreciation and amortization expense, U. T. Austin s adjusted income was $127.4 million or 17.2% of revenues. (4) U. T. Dallas The $5.5 million (216.6%) increase in adjusted income over the same period last year was primarily attributable to an increase in nonexchange sponsored programs as a result of increased Texas Research Incentive Program funds received in 2016 and an increase in gift contributions for operations as a result of increased foundation and corporate gifts. Excluding depreciation and amortization expense, U. T. Dallas adjusted income was $22.8 million or 14.9% of revenues. (5) U. T. El Paso incurred a year-to-date loss of $3.5 million as a result of the following: an increase in tuition exemption scholarship expense, primarily related to the Hazelwood and Hazelwood Legacy programs; an increase in salaries and wages due to a 2% merit pool increase implemented in 2016; and an increase in depreciation expense over the last five years as a result of the rapid growth of buildings and research infrastructure on campus. Excluding depreciation and amortization expense, U. T. El Paso s adjusted income was $4.4 million or 4.4% of revenues. U. T. El Paso anticipates ending the year with a $14.6 million loss, -3.5% of projected revenues, and includes $33.7 million of depreciation and amortization expense. U. T. El Paso is implementing measures to reduce spending, including a hiring freeze on positions not determined to be mission critical and utility savings efforts. (6) U. T. Permian Basin The $2.5 million (59.7%) decrease in adjusted loss over the same period last year was primarily attributable to a decrease in scholarships and fellowships as a result of the PeopleSoft implementation of the Student Services System which delayed financial aid awards. State appropriations also increased due to new funding for the Rural Digital University, as well as increased enrollment. Despite these factors, U. T. Permian Basin still incurred a year-to-date loss of $1.7 million as a result of increased salaries and wages and payroll related costs driven by merit increases and additional faculty to accommodate the increased enrollment. Payroll related costs also increased as a result of increased premium sharing rates. Excluding depreciation and amortization expense, U. T. Permian Basin s adjusted income was $1.8 million or 9.3% of revenues. U. T. Permian Basin anticipates ending the year with a $0.2 million positive margin, 0.3% of projected revenues, and includes $13.4 million of depreciation and amortization expense. (7) U. T. Tyler incurred a year-to-date loss of $2.8, which was primarily attributable to the following: an increase in salaries and wages and payroll related costs driven by merit and market increases and an increase in other contracted services due to the implementation of ImagineNow Intelligent Capture and ServiceNow related to information technology. Excluding depreciation and amortization expense, U. T. Tyler s adjusted income was $0.6 million or 2.0% of revenues. U. T. Tyler anticipates ending the year with a $14.6 million loss, -11.8% of projected revenues, and includes $13.6 million of depreciation and amortization expense. The projected loss is the result of an increase in personnel and renovation projects across the campus not meeting the threshold for capitalization. 12

13 (8) U. T. Southwestern Medical Center The $15.8 million (192.5%) increase in adjusted income over the same period last year was primarily attributable to an increase in net sales and services of hospitals as a result of increased outpatient and inpatient revenue and an increase in net professional fees primarily attributable to a reduction in charity care and a reduction in the contractual allowance for Medicaid. These increases in revenue were partially offset by increases in salaries and wages and payroll related costs as a result of additional employees, a 3% merit increase and increased premium sharing rates. Depreciation and amortization expense also increased due to the opening of the William P. Clements University Hospital in December Excluding depreciation and amortization expense, Southwestern s adjusted income was $63.2 million or 10.0% of revenues. (9) U. T. Medical Branch Galveston The $14.9 million (77.6%) decrease in adjusted income as compared to the same period last year was primarily attributable to an increase in salaries and wages and payroll related costs as a result of 106 additional faculty full-time equivalents resulting from clinical recruitment. In addition, salary adjustments and increased premium sharing rates contributed to the increases in salaries and wages and payroll related costs. Excluding depreciation and amortization, UTMB s adjusted income was $30.9 million or 6.6% of revenues. UTMB anticipates ending the year with a $12.7 million loss which represents -0.7% of projected revenues and includes $147.6 million of depreciation and amortization expense. and service agreements related to South Texas Delivery System Reform Incentive Payment programs. Excluding depreciation and amortization expense, UTHSC-San Antonio s adjusted income was $19.9 million or 10.3% of revenues. (12) U. T. Health Science Center Tyler incurred a year-to-date loss of $5.1 million, which was primarily attributable to an increase in salaries and wages and payroll related costs as a result of the hiring of 66 behavioral health employees due to the dissolution of the main psychiatric subcontractor, as well as the addition of new employees for the new Population/Community Health Program and for the opening of the clinic in Lindale. Excluding depreciation and amortization expense, UTHSC-Tyler s adjusted loss was $2.4 million or -5.6% of revenues. UTHSC-Tyler anticipates ending the year with a positive margin of $2.2 million as a result of adjustments to the workforce size that are currently being planned. This represents 1.1% of projected revenues and includes $10.8 million of depreciation and amortization expense. (10) U. T. Health Science Center Houston The $18.1 million (1,193.1%) increase in adjusted income as compared to the same period last year was primarily attributable to an increase in sponsored program revenue as a result of growth of the physician practice plan. Net professional fees also increased due to an increase in gross charges as a result of faculty recruitments and the planned expansion and growth of the physician practice plan, as well as an increase in uncompensated care revenue. These revenue increases were partially offset by increased salaries and wages and payroll related costs as a result of the ongoing recruitment efforts related to the planned expansion and growth of the physician practice plan. Excluding depreciation and amortization expense, UTHSC-Houston s adjusted income was $34.9 million or 9.2% of revenues. (11) U. T. Health Science Center San Antonio The $7.7 million (53.5%) decrease in adjusted income as compared to the same period last year was primarily attributable to increased payroll related costs, professional fees and services and other contracted services expenses. Payroll related costs increased as a result of higher Group Insurance premium rates, the elimination of the healthcare coverage waiting period for newly hired employees, and changes to healthcare coverage for hourly employees as mandated by the Affordable Care Act. Professional fees and services increased due to engagements with external consultants to develop a clinical transformation strategy associated with the physician practice plan. Other contracted services increased due to increases in subrecipient payments related to federal sponsored programs 13

14 GLOSSARY OF TERMS OPERATING REVENUES: NET STUDENT TUITION All student tuition and fee revenues earned at the UT institution for educational purposes, net of tuition discounting. SPONSORED PROGRAMS Funding received from local, state and federal governments or private agencies, organizations or individuals, excluding Federal Pell Grant Program which is reported as nonoperating. Includes amounts received for services performed on grants, contracts, and agreements from these entities for current operations. This also includes indirect cost recoveries and pass-through federal and state grants. NET SALES AND SERVICES OF EDUCATIONAL ACTIVITIES Revenues that are related to the conduct of instruction, research, and public service and revenues from activities that exist to provide an instructional and laboratory experience for students that create goods and services that may be sold. NET SALES AND SERVICES OF HOSPITALS Revenues (net of discounts, allowances, and bad debt expense) generated from UT health institution s daily patient care, special or other services, as well as revenues from health clinics that are part of a hospital. NET PROFESSIONAL FEES Revenues (net of discounts, allowances, and bad debt expense) derived from the fees charged by the professional staffs at UT health institutions as part of the Medical Practice Plans. These revenues are also identified as Practice Plan income. Examples of such fees include doctor s fees for clinic visits, medical and dental procedures, professional opinions, and anatomical procedures, such as analysis of specimens after a surgical procedure, etc. NET AUXILIARY ENTERPRISES Revenues derived from a service to students, faculty, or staff in which a fee is charged that is directly related to, although not necessarily equal to the cost of the service (e.g., bookstores, dormitories, dining halls, snack bars, inter-collegiate athletic programs, etc.). OTHER OPERATING REVENUES Other revenues generated from sales or services provided to meet current fiscal year operating expenses, which are not included in the preceding categories (e.g., certified nonprofit healthcare company revenues, donated drugs, interest on student loans, etc.) Other receipts for settlements, judgments and lawsuits are considered nonoperating revenues. OPERATING EXPENSES: SALARIES AND WAGES Expenses for all salaries and wages of individuals employed by the institution including full-time, part-time, longevity, hourly, seasonal, etc. Includes salary augmentation and incentive compensation. PAYROLL RELATED COSTS Expenses for all employee benefits paid by the institution or paid by the state on behalf of the institution. Includes supplemental retirement annuities. COST OF GOODS SOLD Purchases of goods for resale and raw materials purchased for use in the manufacture of products intended for sale to others. PROFESSIONAL FEES AND SERVICES Payments for services rendered on a fee, contract, or other basis by a person, firm, corporation, or company recognized as possessing a high degree of learning and responsibility. Includes such items as services of a consultant, legal counsel, financial or audit fees, medical contracted services, guest lecturers (not employees) and expert witnesses. OTHER CONTRACTED SERVICES Payments for services rendered on a contractual basis by a person, firm, corporation or company that possess a lesser degree of learning and responsibility than that required for Professional Fees and Services. Includes such items as temporary employment expenses, janitorial services, dry cleaning services, etc. TRAVEL Payments for travel costs incurred by employees and board members for meetings and training. MATERIALS AND SUPPLIES Payments for consumable items. Includes, but is not limited to: computer consumables, office supplies, paper products, soap, lights, plants, fuels and lubricants, chemicals and gasses, medical supplies and copier supplies. Also includes postal services, and subscriptions and other publications not for permanent retention. UTILITIES Payments for the purchase of electricity, natural gas, water, and thermal energy. COMMUNICATIONS - Electronically transmitted communications services (telephone, internet, computation center services, etc.). REPAIRS AND MAINTENANCE Payments for the maintenance and repair of equipment, furnishings, motor vehicles, buildings and other plant facilities, and waste disposal. Includes, but is not limited to repair and maintenance to copy machines, furnishings, equipment including medical and laboratory equipment, office equipment and aircraft. RENTALS AND LEASES Payments for rentals or leases of furnishings and equipment, vehicles, land and office buildings (all rental of space). PRINTING AND REPRODUCTION Printing and reproduction costs associated with the printing/copying of the institution s documents and publications. BAD DEBT EXPENSE Expenses incurred by the university related to nonrevenue receivables such as non-payment of student loans. 14

15 CLAIMS AND LOSSES Payments for claims from self-insurance programs. Other claims for settlements, judgments and lawsuits are considered nonoperating expenses. INCREASE IN NET OPEB OBLIGATION The change in the actuarially estimated liability of the cost of providing healthcare benefits to UT System s employees after they separate from employment (retire). SCHOLARSHIPS AND FELLOWSHIPS Payments made for scholarship grants to students authorized by law, net of tuition discounting. FEDERAL SPONSORED PROGRAM PASS-THROUGHS TO OTHER STATE AGENCIES Pass-throughs to other Texas state agencies, including other universities, of federal grants and contracts. STATE SPONSORED PROGRAM PASS-THROUGHS TO OTHER STATE AGENCIES Pass-throughs to other Texas state agencies, including Texas universities. DEPRECIATION AND AMORTIZATION Depreciation on capital assets and amortization expense on intangible assets. OTHER OPERATING EXPENSES Other operating expenses not identified in other line items above (e.g., certified non-profit healthcare company expenses, property taxes, insurance premiums, credit card fees, hazardous waste disposal expenses, meetings and conferences, etc.). Other claims for settlements, judgments and lawsuits are considered nonoperating expenses. OPERATING LOSS Total operating revenues less total operating expenses before other nonoperating adjustments like state appropriations. OTHER NONOPERATING ADJUSTMENTS: STATE APPROPRIATIONS Appropriations from the State General Revenue fund, which supplement the UT institutional revenue in meeting operating expenses, such as faculty salaries, utilities, and institutional support. NONEXCHANGE SPONSORED PROGRAMS Funding received for the Federal Pell Grant Program, the portion of state appropriations funded by the American Recovery and Reinvestment Act, Texas Research Incentive Program (TRIP) and Enrollment Growth funding. GIFT CONTRIBUTIONS FOR OPERATIONS Consist of gifts from donors received for use in current operations, excluding gifts for capital acquisition and endowment gifts. Gifts for capital acquisition which can only be used to build or buy capital assets are excluded because they cannot be used to support current operations. Endowment gifts must be held in perpetuity and cannot be spent. The distributed income from endowment gifts must be spent according to the donor s stipulations. NET INVESTMENT INCOME (on institutions sheets) Interest and dividend income on treasury balances, bank accounts, Short Term Fund, Intermediate Term Fund and Long Term Fund. It also includes distributed earnings from the Permanent Health Fund and patent and royalty income. NET INVESTMENT INCOME (on the consolidated sheet) Interest and dividend earnings of the Permanent University Fund, Short Term Fund, Intermediate Term Fund, Long Term Fund and Permanent Health Fund. This line item also includes the Available University Fund surface income, oil and gas royalties, and mineral lease bonus sales. INTEREST EXPENSE ON CAPITAL ASSET FINANCINGS Interest expenses associated with bond and note borrowings utilized to finance capital improvement projects by an institution. This consists of the interest portion of mandatory debt service transfers under the Revenue Financing System, Tuition Revenue bond and Permanent University Fund (PUF) bond programs. PUF interest expense is reported on System Administration as the debt legally belongs to the Board of Regents. ADJUSTED INCOME (LOSS) including Depreciation and Amortization Total operating revenues less total operating expenses including depreciation and amortization expense plus net other nonoperating adjustments. ADJUSTED MARGIN % including Depreciation and Amortization of Adjusted Income (Loss) including depreciation and amortization expense divided by Total plus Net Nonoperating Adjustments less Interest Expense on Capital Asset Financings. AVAILABLE UNIVERSITY FUND TRANSFER Includes Available University Fund (AUF) transfer to System Administration for Educational and General operations and to UT Austin for Excellence Funding. These transfers are funded by investment earnings from the Permanent University Fund (PUF), which are required by law to be reported in the PUF at System Administration. On the MFR, investment income for System Administration has been reduced for the amount of the System Administration transfer so as not to overstate investment income for System Administration. The AUF transfers are eliminated at the consolidated level to avoid overstating System-wide revenues, as the amounts will be reflected as transfers at year-end. INVESTMENT GAINS (LOSSES) Realized and unrealized gains and losses on investments. ADJUSTED INCOME (LOSS) excluding Depreciation and Amortization Total operating revenues less total operating expenses excluding depreciation and amortization expense plus net other nonoperating adjustments. ADJUSTED MARGIN % excluding Depreciation and Amortization of Adjusted Income (Loss) excluding depreciation and amortization expense divided by Total plus Net Nonoperating Adjustments less Interest Expense on Capital Asset Financings. 15

16 The University of Texas System Administration For the Period Ending 30, 2015 Sponsored Programs 11,069, ,125, ,944, % Net Sales and Services of Educational Activities 11,175, ,791, (3,616,297.37) -24.4% Other 12,592, ,756, (30,163,910.10) -70.5% Total 34,837, ,673, (23,835,913.47) -40.6% Salaries and Wages 16,587, ,364, ,223, % Payroll Related Costs 3,469, ,889, , % Professional Fees and Services 2,260, ,470, (209,503.66) -8.5% Other Contracted Services 8,301, ,617, (2,315,963.21) -21.8% Travel 369, , , % Materials and Supplies 9,334, ,806, (471,997.88) -4.8% Utilities 70, , (10,877.59) -13.4% Communications 5,072, ,578, ,494, % Repairs and Maintenance 3,410, ,704, (1,294,903.03) -27.5% Rentals and Leases 2,144, ,117, ,027, % Printing and Reproduction 497, , , % Claims and Losses 3,550, ,168, (10,617,244.36) -74.9% Increase in Net OPEB Obligation 166,710, ,967, ,743, % Pension Expense 53,223, ,223, % Scholarships and Fellowships (3,940.29) 167, (170,940.29) % Depreciation and Amortization 4,571, ,525, ,045, % State Sponsored Program Pass-Through to Other State Agencies 895, ,014, (119,532.00) -11.8% Other 21,447, ,660, , % Total 301,914, ,507, ,406, % Operating Loss (267,077,397.34) (168,834,503.90) (98,242,893.44) -58.2% State Appropriations 196, , (334,510.58) -63.0% Gift Contributions for Operations 202, , (165,660.75) -45.0% Net Investment Income (36,862,307.29) 25,310, (62,173,025.14) % Interest Expense on Capital Asset Financings (17,969,962.66) (18,647,880.75) 677, % Net (54,433,167.91) 7,562, (61,995,278.38) % Adjusted Income (Loss) including Depreciation & Amortization (321,510,565.25) (161,272,393.43) (160,238,171.82) -99.4% Adjusted Margin % including Depreciation & Amortization 19,773.8% % Available University Fund Transfer 23,087, ,397, ,689, % Adjusted Income (Loss) with AUF Transfer (298,423,248.00) (148,874,683.18) (149,548,564.82) % Adjusted Margin % with AUF Transfer -1,390.5% % Investment Gain (Losses) (174,164,725.20) (164,913,572.95) (9,251,152.25) -5.6% Adj. Inc. (Loss) with AUF Transfer & Invest. Gains (Losses) (472,587,973.20) (313,788,256.13) (158,799,717.07) -50.6% Adj. Margin % with AUF Transfer & Invest. Gains (Losses) 309.5% 464.0% Adjusted Income (Loss) with AUF Transfer excluding Depreciation & Amortization (293,851,888.17) (145,348,716.85) (148,503,171.32) % Adjusted Margin % with AUF Transfer excluding Depreciation & Amortization -1,369.2% % 16

17 The University of Texas at Arlington For the Period Ending 30, 2015 Net Student Tuition and Fees 61,296, ,794, ,501, % Sponsored Programs 15,304, ,738, (1,434,497.68) -8.6% Net Sales and Services of Educational Activities 5,465, ,775, (1,309,342.69) -19.3% Net Auxiliary Enterprises 10,107, ,241, , % Other 1,073, ,181, (107,746.47) -9.1% Total 93,247, ,730, , % Salaries and Wages 65,666, ,822, ,844, % Payroll Related Costs 14,440, ,467, , % Cost of Goods Sold 1, , (921.68) -31.7% Professional Fees and Services 2,133, ,208, (74,923.32) -3.4% Other Contracted Services 12,634, ,372, , % Travel 1,596, ,400, , % Materials and Supplies 6,229, ,394, ,834, % Utilities 2,512, ,297, , % Communications 1,195, ,843, (647,566.43) -35.1% Repairs and Maintenance 3,244, ,339, (94,237.50) -2.8% Rentals and Leases 746, , , % Printing and Reproduction 517, , , % Bad Debt Expense 34, , (119,848.12) -77.5% Scholarships and Fellowships 8,198, ,429, (231,218.96) -2.7% Depreciation and Amortization 11,444, ,202, , % Federal Sponsored Program Pass-Through to Other State Agencies 981, , , % State Sponsored Program Pass-Through to Other State Agencies 17, , (21,108.85) -55.4% Other 2,897, ,573, , % Total 134,492, ,857, ,635, % Operating Loss (41,245,521.30) (34,126,553.41) (7,118,967.89) -20.9% State Appropriations 32,870, ,906, ,964, % Nonexchange Sponsored Programs 12,762, ,250, ,512, % Gift Contributions for Operations 1,244, ,682, (437,984.38) -26.0% Net Investment Income 3,928, ,827, , % Interest Expense on Capital Asset Financings (2,964,314.73) (3,182,298.36) 217, % Net 47,842, ,484, ,357, % Adjusted Income (Loss) including Depreciation & Amortization 6,596, ,358, (2,761,443.07) -29.5% Adjusted Margin % including Depreciation & Amortization 4.6% 6.7% Investment Gain (Losses) (3,559,486.17) (2,021,808.73) (1,537,677.44) -76.1% Adj. Inc. (Loss) with Investment Gains (Losses) 3,037, ,336, (4,299,120.51) -58.6% Adj. Margin % with Investment Gains (Losses) 2.2% 5.3% Adjusted Income (Loss) excluding Depreciation & Amortization 18,040, ,560, (2,519,658.14) -12.3% Adjusted Margin % excluding Depreciation & Amortization 12.5% 14.7% 17

18 The University of Texas at Austin For the Period Ending 30, 2015 Net Student Tuition and Fees 120,000, ,250, (1,250,000.00) -1.0% Sponsored Programs 145,237, ,277, (2,040,372.94) -1.4% Net Sales and Services of Educational Activities 113,167, ,731, , % Net Auxiliary Enterprises 94,395, ,753, ,642, % Other 2,111, ,272, , % Total 474,911, ,284, ,626, % Salaries and Wages 292,543, ,757, ,785, % Payroll Related Costs 81,607, ,029, ,577, % Cost of Goods Sold 7,287, ,544, , % Professional Fees and Services 6,935, ,078, (1,143,228.90) -14.2% Other Contracted Services 38,321, ,170, ,150, % Travel 9,617, ,662, (1,044,940.72) -9.8% Materials and Supplies 37,887, ,399, ,488, % Utilities 23,765, ,543, (777,756.25) -3.2% Communications 6,101, ,955, (11,854,493.22) -66.0% Repairs and Maintenance 21,045, ,544, ,500, % Rentals and Leases 6,696, ,445, , % Printing and Reproduction 2,284, ,592, (307,891.28) -11.9% Bad Debt Expense 275, (205.93) 275, ,881.4% Scholarships and Fellowships 30,000, ,000, Depreciation and Amortization 63,750, ,000, ,750, % Federal Sponsored Program Pass-Through to Other State Agencies 1,036, , , % Other 34,668, ,490, ,177, % Total 663,823, ,181, ,642, % Operating Loss (188,912,802.52) (173,897,219.27) (15,015,583.25) -8.6% State Appropriations 88,536, ,322, ,213, % Nonexchange Sponsored Programs 11,000, ,900, (900,000.00) -7.6% Gift Contributions for Operations 35,646, ,207, ,439, % Net Investment Income 59,034, ,586, ,447, % Interest Expense on Capital Asset Financings (11,819,396.91) (12,684,886.14) 865, % Net 182,398, ,332, ,066, % Adjusted Income (Loss) including Depreciation & Amortization (6,514,014.39) (22,564,459.78) 16,050, % Adjusted Margin % including Depreciation & Amortization -1.0% -3.6% Available University Fund Transfer 70,203, ,062, ,140, % Adjusted Income (Loss) with AUF Transfer 63,688, ,498, ,190, % Adjusted Margin % with AUF Transfer 8.6% 6.3% Investment Gain (Losses) (84,882,066.68) (78,544,300.16) (6,337,766.52) -8.1% Adj. Inc. (Loss) with AUF Transfer & Invest. Gains (Losses) (21,193,081.07) (35,046,259.94) $13,853, % Adj. Margin % with AUF Transfer & Invest. Gains (Losses) -3.2% -5.7% Adjusted Income (Loss) with AUF Transfer excluding Depreciation & Amortization 127,438, ,498, ,940, % Adjusted Margin % with AUF Transfer excluding Depreciation & Amortization 17.2% 14.9% 18

19 The University of Texas at Brownsville For the Period Ending 30, 2015 Net Student Tuition and Fees - 7,725, (7,725,150.94) % Sponsored Programs - 5,603, (5,603,776.34) % Net Sales and Services of Educational Activities - 540, (540,167.09) % Net Auxiliary Enterprises - 457, (457,116.23) % Other - 3, (3,447.75) % Total - 14,329, (14,329,658.35) % Salaries and Wages - 12,818, (12,818,107.29) % Payroll Related Costs - 3,676, (3,676,662.88) % Professional Fees and Services - 215, (215,052.55) % Other Contracted Services - 145, (145,478.04) % Travel - 381, (381,985.64) % Materials and Supplies 36, ,272, (1,236,076.89) -97.1% Utilities - 472, (472,781.35) % Communications - 41, (41,034.26) % Repairs and Maintenance - 205, (205,508.31) % Rentals and Leases - 899, (899,116.37) % Printing and Reproduction - 75, (75,893.59) % Scholarships and Fellowships - 3,336, (3,336,164.06) % Depreciation and Amortization 152, ,133, (1,981,441.33) -92.9% Federal Sponsored Program Pass-Through to Other State Agencies - 35, (35,442.57) % Other - 1,329, (1,329,564.89) % Total 188, ,038, (26,850,310.02) -99.3% Operating Loss (188,567.11) (12,709,218.78) 12,520, % State Appropriations - 10,152, (10,152,795.77) % Nonexchange Sponsored Programs - 468, (468,794.48) % Gift Contributions for Operations - 137, (137,365.00) % Net Investment Income - 561, (561,285.34) % Interest Expense on Capital Asset Financings - (698,813.13) 698, % Net - 10,621, (10,621,427.46) % Adjusted Income (Loss) including Depreciation & Amortization (188,567.11) (2,087,791.32) 1,899, % Adjusted Margin % including Depreciation & Amortization N/A -8.1% Investment Gain (Losses) - (921,185.93) 921, % Adj. Inc. (Loss) with Investment Gains (Losses) (188,567.11) (3,008,977.25) 2,820, % Adj. Margin % with Investment Gains (Losses) N/A -12.2% Adjusted Income (Loss) excluding Depreciation & Amortization (36,358.00) 45, (82,217.12) % Adjusted Margin % excluding Depreciation & Amortization N/A 0.2% 19

20 The University of Texas at Dallas For the Period Ending 30, 2015 Net Student Tuition and Fees 71,018, ,993, ,024, % Sponsored Programs 16,636, ,646, (9,242.37) -0.1% Net Sales and Services of Educational Activities 3,792, ,851, (59,019.58) -1.5% Net Auxiliary Enterprises 6,774, ,555, ,218, % Other 1,275, ,123, , % Total 99,497, ,169, ,327, % Salaries and Wages 71,229, ,414, ,815, % Payroll Related Costs 16,827, ,886, ,941, % Professional Fees and Services 2,638, ,496, , % Other Contracted Services 3,692, ,410, (718,763.75) -16.3% Travel 1,407, ,363, , % Materials and Supplies 7,643, ,358, ,285, % Utilities 3,332, ,726, , % Communications 135, , (50,394.73) -27.1% Repairs and Maintenance 1,253, ,528, (275,048.43) -18.0% Rentals and Leases 1,716, ,901, (184,892.81) -9.7% Printing and Reproduction 374, , (209,549.47) -35.9% Scholarships and Fellowships 10,522, ,681, (2,158,890.36) -17.0% Depreciation and Amortization 14,830, ,360, , % Federal Sponsored Program Pass-Through to Other State Agencies 10, , % State Sponsored Program Pass-Through to Other State Agencies 82, , % Other 5,731, ,283, ,447, % Total 141,428, ,182, ,245, % Operating Loss (41,931,517.42) (37,013,213.74) (4,918,303.68) -13.3% State Appropriations 27,655, ,159, (2,504,355.77) -8.3% Nonexchange Sponsored Programs 13,159, ,681, ,478, % Gift Contributions for Operations 7,271, ,177, ,094, % Net Investment Income 5,685, ,565, , % Interest Expense on Capital Asset Financings (3,860,284.29) (4,050,174.72) 189, % Net 49,911, ,534, ,377, % Adjusted Income (Loss) including Depreciation & Amortization 7,980, ,520, ,459, % Adjusted Margin % including Depreciation & Amortization 5.2% 1.8% Investment Gain (Losses) (1,851,557.62) 3,513, (5,365,184.73) % Adj. Inc. (Loss) with Investment Gains (Losses) 6,128, ,034, , % Adj. Margin % with Investment Gains (Losses) 4.0% 4.2% Adjusted Income (Loss) excluding Depreciation & Amortization 22,811, ,881, ,929, % Adjusted Margin % excluding Depreciation & Amortization 14.9% 12.2% 20

21 The University of Texas at El Paso For the Period Ending 30, 2015 Net Student Tuition and Fees 28,110, ,666, (555,786.37) -1.9% Sponsored Programs 22,274, ,379, ,895, % Net Sales and Services of Educational Activities 2,710, ,164, ,546, % Net Auxiliary Enterprises 9,006, ,585, ,421, % Other 5, , (154,718.82) -96.7% Total 62,107, ,955, ,152, % Salaries and Wages 46,744, ,397, ,346, % Payroll Related Costs 11,463, ,965, , % Professional Fees and Services 3,091, ,305, ,786, % Other Contracted Services 3,101, ,130, (3,029,282.40) -49.4% Travel 2,036, ,140, (104,326.28) -4.9% Materials and Supplies 5,675, ,684, (8,705.89) -0.2% Utilities 2,205, ,927, , % Communications 463, , (88,357.45) -16.0% Repairs and Maintenance 1,702, ,489, , % Rentals and Leases 843, ,675, (832,215.98) -49.7% Printing and Reproduction 277, , (108,486.27) -28.1% Scholarships and Fellowships 9,110, ,333, ,777, % Depreciation and Amortization 7,860, ,173, , % Federal Sponsored Program Pass-Through to Other State Agencies 862, , , % State Sponsored Program Pass-Through to Other State Agencies 47, , , % Other 4,345, ,974, ,371, % Total 99,831, ,611, ,220, % Operating Loss (37,723,792.96) (35,656,140.33) (2,067,652.63) -5.8% State Appropriations 28,078, ,714, ,364, % Nonexchange Sponsored Programs 2,631, ,002, (1,370,737.91) -34.2% Gift Contributions for Operations 1,881, ,117, , % Net Investment Income 3,420, ,431, (10,854.87) -0.3% Interest Expense on Capital Asset Financings (1,795,346.55) (1,955,226.93) 159, % Net 34,216, ,310, ,906, % Adjusted Income (Loss) including Depreciation & Amortization (3,506,912.32) (3,345,701.09) (161,211.23) -4.8% Adjusted Margin % including Depreciation & Amortization -3.6% -3.7% Investment Gain (Losses) (4,421,152.69) (6,964,026.79) 2,542, % Adj. Inc. (Loss) with Investment Gains (Losses) (7,928,065.01) (10,309,727.88) 2,381, % Adj. Margin % with Investment Gains (Losses) -8.5% -12.2% Adjusted Income (Loss) excluding Depreciation & Amortization 4,353, ,827, , % Adjusted Margin % excluding Depreciation & Amortization 4.4% 4.2% 21

22 The University of Texas of the Permian Basin For the Period Ending 30, 2015 Net Student Tuition and Fees 4,851, ,197, , % Sponsored Programs 1,731, ,629, , % Net Sales and Services of Educational Activities 353, , (176,895.44) -33.4% Net Auxiliary Enterprises 1,924, ,060, , % Other 188, , , % Total 9,050, ,449, ,601, % Salaries and Wages 8,331, ,920, ,411, % Payroll Related Costs 1,940, ,303, , % Cost of Goods Sold 2, , (1,231.18) -31.8% Professional Fees and Services 358, ,026, (667,589.76) -65.1% Other Contracted Services 768, , (185,070.52) -19.4% Travel 365, , , % Materials and Supplies 1,630, ,215, , % Utilities 419, , (95,536.20) -18.6% Communications 210, , , % Repairs and Maintenance (238,499.77) 372, (611,259.11) % Rentals and Leases 64, , (39,982.25) -38.2% Printing and Reproduction 33, , , % Scholarships and Fellowships 2,077, ,607, (1,529,814.56) -42.4% Depreciation and Amortization 3,491, ,257, , % Federal Sponsored Program Pass-Through to Other State Agencies (44,024.12) - (44,024.12) 100.0% Other 317, , (107,432.08) -25.3% Total 19,730, ,168, (438,230.34) -2.2% Operating Loss (10,679,918.24) (12,719,221.95) 2,039, % State Appropriations 8,513, ,290, ,222, % Nonexchange Sponsored Programs 801, , (7,833.93) -1.0% Gift Contributions for Operations 443, ,265, (822,405.42) -65.0% Net Investment Income 581, , , % Interest Expense on Capital Asset Financings (1,355,420.67) (1,428,159.36) 72, % Net 8,984, ,508, , % Adjusted Income (Loss) including Depreciation & Amortization (1,695,149.37) (4,211,094.93) 2,515, % Adjusted Margin % including Depreciation & Amortization -8.7% -24.2% Investment Gain (Losses) (957,384.63) (741,372.01) (216,012.62) -29.1% Adj. Inc. (Loss) with Investment Gains (Losses) (2,652,534.00) (4,952,466.94) 2,299, % Adj. Margin % with Investment Gains (Losses) -14.4% -29.8% Adjusted Income (Loss) excluding Depreciation & Amortization 1,796, (953,445.74) 2,749, % Adjusted Margin % excluding Depreciation & Amortization 9.3% -5.5% 22

23 The University of Texas Rio Grande Valley For the Period Ending 30, 2015 Net Student Tuition and Fees 29,334, ,334, % Sponsored Programs 25,640, ,640, % Net Sales and Services of Educational Activities 2,034, ,034, % Net Auxiliary Enterprises 2,828, ,828, % Other 406, , % Total 60,243, ,243, % Salaries and Wages 48,131, ,131, % Payroll Related Costs 12,411, ,411, % Cost of Goods Sold 107, , % Professional Fees and Services 368, , % Other Contracted Services 1,494, ,494, % Travel 952, , % Materials and Supplies 2,409, ,409, % Utilities 2,835, ,835, % Communications 41, , % Repairs and Maintenance 1,569, ,569, % Rentals and Leases 428, , % Printing and Reproduction 185, , % Bad Debt Expense 4, , % Scholarships and Fellowships 13,284, ,284, % Depreciation and Amortization 9,554, ,554, % Federal Sponsored Program Pass-Through to Other State Agencies 40, , % Other 1,785, ,785, % Total 95,605, ,605, % Operating Loss (35,361,600.55) - (35,361,600.55) 100.0% State Appropriations 38,836, ,836, % Nonexchange Sponsored Programs 2,037, ,037, % Gift Contributions for Operations 633, , % Net Investment Income 1,253, ,253, % Interest Expense on Capital Asset Financings (1,579,460.94) - (1,579,460.94) 100.0% Net 41,181, ,181, % Adjusted Income (Loss) including Depreciation & Amortization 5,819, ,819, % Adjusted Margin % including Depreciation & Amortization 5.6% Investment Gain (Losses) (461,458.52) - (461,458.52) 100.0% Adj. Inc. (Loss) with Investment Gains (Losses) 5,358, ,358, % Adj. Margin % with Investment Gains (Losses) 5.2% Adjusted Income (Loss) excluding Depreciation & Amortization 15,373, ,373, % Adjusted Margin % excluding Depreciation & Amortization 14.9% 23