When natural disasters strike collegiate athletic facilities, they leave more than canceled events and disappointed fans in their wake. Teams need to be relocated, facilities are shut down, games are rescheduled and damages must be quickly repaired.
Regardless of whether these are short-term or long-term arrangements, it becomes a confusing time for student-athletes, university personnel and fans alike. The confusion is compounded, however, by the expenses you incur and insurance proceeds you’ve received as a result. Many collegiate athletic accounting departments are unsure of how to report them and worry about raising red flags with the National Collegiate Athletic Association (NCAA).
The January 15 deadline is fast approaching to report your athletic department’s NCAA Statement of Revenues and Expenditures. And if natural disasters like September’s Hurricane Florence have affected your campus, you should take great care in how you report the extraordinary expenditures and other financial anomalies that result.
What should I do?
According to the NCAA, if reporting revenue and expenditure categories by sport, these expenditures should be reported by the associated sport wherever possible (and those more general in nature classified as “non-specific”). If a revenue or expense transaction doesn’t fit in an existing category, the “other” revenue and expense categories would be appropriate to use.
Additionally, add notes in the comments section of the NCAA Financial Reporting System (FRS) as well as adding footnotes in the NCAA Agreed Upon Procedure (AUP) to clarify that certain revenues/expenses were extraordinary due to the natural disaster—and that this caused a fluctuation in your athletic department’s revenue and expenditures for the year.
Even if you haven’t been affected by natural disaster, it’s important to establish these guidelines on reporting such expenditures and revenues before an event hits. With proper procedures in place, you’ll have one less point of confusion in an already uncertain situation—and provide much-needed clarity for these important parts of your annual financial story.
Don’t forget to seek out help.
Contact one of our collegiate athletic CPAs to make sure these and other out-of-the-ordinary entries are reported properly on your NCAA Statement of Revenues and Expenditures. A little professional advice now can save you a lot of aggravation—and possible compliance issues—down the road.
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