Detailed Financials

Consolidated Statements of Financial Position at July 31, 2005 and 2004.

(All figures are in thousands.)

Cash and cash equivalents$ 19,578$ 8,193
Student receivables, less allowance for doubtful accounts of $966 and $1,104, respectively3,6464,350
Other accounts receivable3,1122,940
Student loans, less allowance for loan losses of $2,030 and $2,132 respectively25,87029,549
Contributions receivable, net15,58818,243
Prepaid expenses, inventories, and other assets7,3826,834
Assets held as trustee or agent91,72187,113
Property, facilities and equipment, net293,773314,565
Total assets$ 1,118,462$ 1,049,199
Liabilities and Net Assets
Accounts payable and accrued liabilities$ 22,094$ 26,502
Accrued salaries and wages3,6893,680
Student deposits, advance payments, and deferred revenue7,2826,563
U.S. government-funded student loans14,89314,600
Trust and agency obligations63,60261,682
Long term obligations202,724205,788
Total liabilities314,284318,815
Net assets:
Temporarily restricted64,26860,597
Permanently restricted141,829127,561
Total net assets804,178730,384
Total liabilities and net assets$ 1,118,462$ 1,049,199

Consolidated Statements of Activities for the years ended July 31, 2005 and 2004

 UnrestrictedTemporarily RestrictedPermanently Restricted2005 Total2004 Total
Student tuition and fees$198,744 $ – $ – $198,744$193,895
  Less student aid(50,169)(50,169)(47,171)
  Net student tuition and fees148,575148,575146,724
Room and board22,97022,97022,135
Private gifts and grants8,6452,0952,27113,01114,922
Endowment support22,88012925523,26421,006
Government grants2,8792,8792,940
Sales and services8,7228,7227,521
Other revenue5,9542,636198,6095,534
Net assets released from restriction8,822(8,822)
Total revenues229,447(3,962)2,545228,030220,782

Instruction and research80,66180,66178,223
Academic support27,77227,77229,725
Student services32,94732,94731,282
Public service9,8069,8069,332
Auxiliary enterprises17,55817,55816,956
Management and general39,11639,11640,572
Membership development1,5191,5191,400
Total expenses218,204218,204216,444
Change in net assets before non-operating revenues and expenses11,243(3,962)2,5459,8264,338
Adjustment of actuarial liability3,921(2)3,919(454)
Investment income6,8211441527,1176,550
Net realized and unrealized gains from investments56,27311410,82667,21342,914
Appropriation of prior years endowment gains(15,963)(15,963)(14,591)
Total non-operating revenues and expenses44,6127,63311,72363,96835,521
Change in net assets55,8553,67114,26873,79439,859
Net assets at beginning of year542,22660,597127,561730,384690,525
Net assets at end of year$598,081$64,268$141,829$804,178$730,384

This financial information is summarized from the July 31, 2005, Consolidated Financial Statements of Pepperdine University, which have been audited by our independent auditors. The statements were prepared in accordance with generally accepted accounting principles applicable to colleges and universities. A complete copy of the audited financial statements is available free of charge upon request from the office of the Controller.

In the spirit of the recent Sarbanes-Oxley legislation (not yet required of non-profit corporations) and consistent with our ongoing efforts to improve corporate governance, the Board of Regents has established an Audit Committee and approved its Charter. Five independent members of the Board of Regents comprise the Audit Committee, which meets at least quarterly and is responsible for the selection and retention of the independent auditors, as well as the determination of their independence. The Audit Committee also reviews the University’s systems of internal control and oversees the Auditing Services function. Finally, the Audit Committee has established a system to receive and investigate confidential and anonymous communications concerning the processing and presentation of financial information.