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Board of Regents From the President Independent Auditors’ Report Management’s Discussion & Analysis Financial Statements Notes Note 1 – Basis of Presentation and Summary of Significant Accounting Policies Note 2 – Cash and Cash Equivalents Note 3 – Investments Note 4 – Accounts and Loans Receivable Note 5 – Capital Assets Note 6 – Accrued Expenses and Compensated Absences Note 7 – Other Postemployment Benefits (OPEB) Note 8 – Unearned Revenue Note 9 – Bonds, Capital Leases, and Notes Payable Note 10 – Other Liabilities Note 11 – Net Position Note 12 – Spending Limitations Note 13 – Scholarship Allowances Note 14 – Health Services Revenue Note 15 – Retirement Plans and Insurance Programs Note 16 – Segment and Blended Component Unit Information Note 17 – Discretely Presented Component Units Note 18 – Related Organizations and Jointly Governed Organizations Note 19 – Commitments and Contingencies Note 20 – Subsequent Events Required Supplementary Information Principal Officers & Staff Select Page 2018 Annual Financial Report The University of Colorado and the Office of University Controller are pleased to offer the 2018 Annual Financial Report. Prefer a PDF of the Annual Financial Report? Download PDF Would you like to see related or prior year reports? See More What do all of these numbers mean? The Office of University Controller developed a companion website to help make financial report information easier to understand. View Companion Site © Office of University Controller 2018 This report must be considered in its entirety. × Note 6 – Accrued Expenses and Compensated Absences Table 6.1 details the accrued expenses as of June 30, 2018 and 2017 by type. Table 6.1 Accrued Expenses (in thousands) Type 2018 2017 University Accrued salaries and benefits $ 113,654 259,583 Accrued interest payable 4,403 4,270 Other accrued expenses 1,654 1,439 Total Accrued Expenses $ 119,711 265,292 Table 6.2 Compensated Absences (in thousands) 2018 2017 Beginning of year $ 226,758 204,028 Additions 277,138 226,573 Reductions (254,160) (203,843) End of year $ 249,736 226,758 Current compensated absences 16,155 16,483 CLOSE Note 1 - Basis of Presentation and Summary of Significant Accounting Policies Note 1 – Basis of Presentation and Summary of Significant Accounting Policies GOVERNANCE The University of Colorado (the University) is a comprehensive degree-granting research university in the State of Colorado (the State). It is governed by a nine-member Board of Regents (the Regents) elected by popular vote in the State’s general elections. Serving staggered six-year terms, one member is elected from each of the State’s seven congressional districts with two Regents elected from the State at large. The University comprises the system office and the following three accredited campuses, each with its unique mission as detailed below: University of Colorado Boulder (CU Boulder) Established in 1861, CU Boulder is a comprehensive graduate research university (with selective admission standards) offering a comprehensive array of undergraduate, master’s, and doctoral degree programs. University of Colorado Denver | Anschutz Medical Campus (CU Denver | Anschutz) Originally operated as two separate campuses, the Health Sciences Center and the Denver campus were established in 1883 and 1974, respectively. In 2004, the two campuses were institutionally merged into the University of Colorado Denver. The consolidated institution is an urban comprehensive research university offering a full range of undergraduate, graduate, and professional degree programs in life sciences, professional programs, and liberal arts. The campuses are currently referred to collectively as CU Denver | Anschutz and separately as the University of Colorado Denver (CU Denver) and the University of Colorado Anschutz Medical Campus (CU Anschutz). University of Colorado Colorado Springs (UCCS) Established as a separate campus in 1965, UCCS is a comprehensive graduate research university (with selective admission standards) offering a comprehensive array of undergraduate, master’s, and doctoral degree programs. To accomplish its mission, the University has over 7,200 instructional faculty serving over 65,000 students through 467 degree programs in 26 schools and colleges. BASIS OF PRESENTATION AND FINANCIAL REPORTING ENTITY Blended Component Units The University’s financial reporting entity includes the operations of the University and all related entities for which the University is financially accountable. Financial accountability may stem from the University’s ability to appoint a majority of the governing board of the related organization, its ability to impose its will on the related organization, its ability to access assets, or its responsibility for debts of the related organization. Blended component units generally include those entities (1) that provide services entirely to the University, (2) in which there is a financial benefit or burden relationship, or (3) in which management of the University has operational responsibility. The University has the following blended component units: University License Equity Holding, Inc. (ULEHI) Originally established in 1992, with a significant reorganization in 2001, ULEHI facilitates certain licensing activities for the University. ULEHI is a nonprofit entity under Section 501(c)(3) of the Internal Revenue Code.The University appoints a voting majority of ULEHI’s governing body, is able to impose its will on the organization, and the organization provides services entirely to the University.Detailed financial information may be obtained directly from ULEHI at 12635 East Montview Boulevard, Aurora, Colorado 80045. University of Colorado Medicine (CU Medicine) University Physicians, Inc. d/b/a CU Medicine, is a Colorado non-profit corporation under Section 501(c)(3) of the Internal Revenue Code, organized to perform the billing, collection, and disbursement functions for professional services rendered for CU Anschutz as authorized in Section 23-20-114 of the Colorado Revised Statutes (C.R.S.). CU Medicine is the School of Medicine’s (SOM) faculty practice plan with approximately 3,300 member providers. CU Medicine does not employ physicians or practice medicine directly; it provides the business and administrative support for the clinical faculty employed by the SOM. The members’ primary sites of practice are at the UCHealth University of Colorado Hospital (UCH) and Children’s Hospital Colorado (Children’s Colorado), but members also provide limited clinical services at multiple hospital and clinic sites throughout the region, including other UCHealth locations, the National Jewish Medical and Research Center, the Veterans Administration Medical Center, and Denver Health and Hospital Authority. The majority of patients cared for reside within the Denver metropolitan area.The University appoints a majority of CU Medicine’s governing body, and is able to impose its will. Additionally, CU Medicine exclusively benefits the University by providing the services described above.Beginning in fiscal year 2018 , CU Medicine participated in a federally funded program available to physicians employed by state-owned medical schools. The Colorado Department of Health Care Policy & Financing (HCPF) filed a proposed state Medicaid plan amendment with the Centers for Medicare and Medicaid Services (CMS) on behalf of CU Medicine and the SOM to secure access to this program. The supplemental payment program is designed to expand patient access by providing enhanced payments to physicians and other qualifying providers. In July 2017, HCPF’s filing was approved by CMS and under the terms of the approved program, CU Medicine received $62.0 million in supplemental payments during Fiscal Year 2018. The supplemental funding will be used to maintain and increase patient access to CU Medicine’s services and for other programs defined in collaboration with HCPF, and is included in health...