HomeMy WebLinkAboutRes 13-01 WA Approving Annual Audit Report FY 11-12 WESTLAKE ACADEMY
RESOLUTION NO. 13-01
A RESOLUTION OF THE WESTLAKE ACADEMY BOARD OF TRUSTEES
APPROVING THE FISCAL YEAR 2011-2012 ANNUAL AUDIT REPORT FROM
PATTILLO, BROWN & HILL, LLP.
WHEREAS, Section 7.3.6 of the Data Collection & Reporting section of the Financial
Accountability System Resource Guide Update 11.0 requires that the annual financial and
compliance report be audited by an independent auditor, and
WHEREAS, Section 7.3.6 of the Data Collection & Reporting section of the Financial
Accountability System Resource Guide Update 11.0 requires the audit report be submitted to the
Division of School Financial Audits of TEA no later than 150 days after the close of the fiscal
year, and
WHEREAS, the audit report must be approved by the Board of Trustees.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF TRUSTEES OF
WESTLAKE ACADEMY:
SECTION 1: The above findings are hereby found to be true and correct and are
incorporated herein in its entirety.
SECTION 2: That the Board of Trustees of Westlake Academy hereby approves the
fiscal year 2011-2012 annual audit report from Pattillo, Brown &Hill, LLP. attached as Exhibit
«A„
SECTION 3: If any portion of this resolution shall, for any reason, be declared invalid
by any court of competent jurisdiction, such invalidity shall not affect the remaining provisions
hereof and the Council hereby determines that it would have adopted this Resolution without the
invalid provision.
Resolution 13-01
Page 1 of 2
SECTION 4: That this resolution shall become effective from and after its date of
passage.
PASSED AND APPROVED BY THE BOARD OF TRUSTEES OF WESTLAKE
ACADEMY, A CHARTER SCHOOL OF THE STATE OF TEXAS, ON THE 7th DAY
OF JANUARY, 2013.
r
ATTEST: La ra Wheat, President
Kelly Edwa , Board Secretary fhomas E. Brym r, S perin endent
APPROV S O FO M:
Janet S. Bkb-eW6kL-_$tt6ton Lowry,
School Attorney
Resolution 13-01
Page 2 of 2
E ACADEMY
international Baccalaureate Charter School
ANNUAL FINANCIAL
•
REPORT FOR THE YEAR
ENDED AUGUST 31, 2012
�0 M004
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6
- --
PATTILLO, BROWN
CERTIFIED PUBLIC ACCOUNTANTS 0 BUSINESS CONSULTANTS
WESTLAKE ACADEMY
(A COMPONENT UNIT OF THE TOWN OF WESTLAKE)
ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED AUGUST 31,2012
TABLE OF CONTENTS
Exhibit Page
Certificate of Board 1
Independent Auditor's Report 2-3
Management's Discussion and Analysis 4- 11
Basic Financial Statements
Government-wide Statements:
A-1 Statement of Net Assets 12
B-1 Statement of Activities 13 - 14
Governmental Fund Financial Statements:
C-1 Balance Sheet 15 - 16
C-3 Statement of Revenues,Expenditures,and Changes in Fund Balance 17- 18
D-1 Statement of Fiduciary Net Assets 19
Notes to the Financial Statements 20-29
Required Supplementary Information
E-1 Statement of Revenues,Expenditures,and Changes in Fund Balance
Budget and Actual—General Fund 30
Notes to Required Supplementary Information 31
Combining Statements
Nonmajor Governmental Funds:
F-1 Combining Balance Sheet 32-35
F-2 Combining Statement of Revenues,Expenditures,and Changes in Fund Balances 36-39
Internal Control Report
Report on Internal Control Over Financial Reporting and on Compliance and
Other Matters Based on an Audit of Financial Statements Performed in
Accordance with Government Auditing Standards 40-41
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CERTIFICATE OF BOARD
Westlake Academy Tarrant 220-810
Name of School County Co.-Dist. Number
We, the undersigned, certify that.the attached annual financial reports of the alcove-named school district were reviewed and
(check one) ✓ approved disapproved for the year ended August 31, 2012,at a meeting of the Board of Trustees of
such school district on the 7t°day of January 2013.
Signal&of Board Secretary Signature of Board President
If the Board of Trustees disapproved of the auditors' report, the reason(s)for disapproving it is(are):
(attach list as necessary)
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PATTILLO, BROWN & HILL, L.L.P.
CERTIFIED PUBLIC ACCOUNTANTS ■ BUSINESS CONSULTANTS
INDEPENDENT AUDITOR'S REPORT
Board of Trustees
Westlake Academy
Members of the Board:
We have audited the accompanying financial statements of the governmental activities, the discretely presented
component unit, each major fund, and the aggregate remaining fund information of Westlake Academy (the "Academy") as
of and for the year ended August 31,2012,which collectively comprise the Academy's basic financial statements as listed in
the table of contents. These financial statements are the responsibility of Westlake Academy's management. Our
responsibility is to express opinions on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America
and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective
financial position of the governmental activities,the discretely presented component unit, each major fund and the aggregate
remaining fund information of Westlake Academy as of August 31,2012,and the respective changes in financial position for
the year then ended in conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated December 19, 2012, on
our consideration of the Academy's internal control over financial reporting and on our tests of its compliance with certain
provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe
the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to
provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an
audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our
audit.
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115 SOUTH CHURCH STREET■HILLSBORO,TX 76645■(254)582-2583 ■FAX:(254)582-5731 ■www.pbhcpa.com
AFFILIATE OFFICES:BROWNSVILLE,TX(956)544-7778■TEMPLE,TX(254)791-3460
WACO,TX(254)772-4901 ■ALBUQUERQUE,NM(505)266-5904
Accounting principles generally accepted in the United States of America require that the management's discussion
and analysis and budgetary comparison information on pages 4 through 11 and page 30 be presented to supplement the basic
financial statements. Such information, although not a part of the basic financial statements,is required by the Governmental
Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial
statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the
required supplementary information in accordance with auditing standards generally accepted in the United States of
America, which consisted of inquiries of management about the methods of preparing the information and comparing the
information for consistency with management's responses to our inquiries, the basic financial statements, and other
knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any
assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion
or provide any assurance.
Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively
comprise Westlake Academy's basic financial statements as a whole. The combining nonmajor fund financial statements are
presented for purposes of additional analysis and are not a required part of the financial statements. The combining nonmajor
fund financial statements are the responsibility of management and were derived from and relate directly to the underlying
accounting and other records used to prepare the financial statements. The information has been subjected to the auditing
procedures applied in the audit of the financial statements and certain additional procedures, including comparing and
reconciling such information directly to the underlying accounting and other records used to prepare the financial statements
or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally
accepted in the United States of America. In our opinion,the information is fairly stated in all material respects in relation to
the financial statements as a whole.Lu,�, V-, 1, 1, P
PJLkJ
December 19,2012
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WESTLAKE ACADEMY
(A COMPONENT UNIT OF TOWN OF WESTLAKE)
MANAGEMENT'S DISCUSSION AND ANALYSIS
AUGUST 31,2012
This section of Westlake Academy's (the "Academy") annual financial report presents our discussion and analysis of the
Academy's financial performance during the fiscal year ended August 31, 2012. Please read it in conjunction with the
Academy's financial statements,which follow this section.
FINANCIAL HIGHLIGHTS
• On the government-wide financial statements, the assets of the Academy exceeded liabilities by
$819,090(Net Assets). This is a decrease of$97,871 for the year ended August 31,2012.
• The Academy had$5,793,560 in expenses related to governmental activities of which$935,815 of these
expenses were offset by program-specific charges for services or grants and contributions. This is a total
expense increase of$908,575 over the prior year.
• The General Fund reported a fund balance this year of$814,487, a decrease of$100,173 from the prior
year.
OVERVIEW OF THE FINANCIAL STATEMENTS
This annual report consists of three parts—management's discussion and analysis (this section), the basic financial
statements, and required supplementary information. The basic financial statements include two kinds of statements that
present different views of the Academy:
• The first two statements are government-wide financial Figure A-1,Required Components of the
statements that provide both long-term and short-term Academy's Annual Financial Report
information about the Academy's overall financial
status.
V em&a'd Basic Required
• The remaining statements are fund financial statements Dcacad&t74 Financial Supplementary
that focus on individual parts of the government, aid Statements Information
reporting the Academy's operations in more detail than
the government-wide statements.
• The governmental funds statements tell how
general government services were financed in the
short term as well as what remains for future --------------------
spending.
• Fiduciary fund statements provide information about Government-Wide Fund �Q
Financial Financial
the financial relationships in which the District acts Statements Statements
solely as a trustee or agent for the benefit of others, to SrHt�
whom the resources in question belong.
Summary Detail
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The financial statements also include notes that explain some of the information in the financial statements and provide more
detailed data. The statements are followed by a section of required supplementary information that further explains and
supports the information in the financial statements. Figure A-1 shows how the required parts of this annual report are
arranged and related to one another.
Figure A-2 summarizes the major features of the Academy's financial statements, including the portion of the Academy
government they cover and the types of information they contain. The remainder of this overview section of management's
discussion and analysis explains the structure and contents of each of the statements.
Government-wide Statements
The government-wide statements report information about the Academy as a whole using accounting methods similar to
those used by private-sector companies. The statement of net assets includes all of the government's assets and liabilities.
All of the current year's revenues and expenses are accounted for in the statement of activities regardless of when cash is
received or paid.
The two government-wide statements report the Academy's net assets and how they have changed. Net assets—the
difference between the Academy's assets and liabilities—is one way to measure the Academy's financial health or position.
Over time, increases or decreases in the Academy's net assets are an indicator of whether its financial
health is improving or deteriorating,respectively.
The government-wide financial statements of the Academy include the Governmental activities. Most of the Academy's
basic services are included here, such as instruction, extracurricular activities, curriculum and staff development, health
services,and general administration. State funds,donations and grants finance most of these activities.
Figure A-2
Major features of the Academ 's Government-wide and Fund Financial Statements
Type of Statement Government-wide Governmental Funds Proprietary Funds Fiduciary Funds
Entire government The activities of the Activities the Academy Instances in which the
(except fiduciary funds) Academy that are not operates similar to private Academy is the trustee or
Scope and the Academy's proprietary or fiduciary businesses i.e.self- agent for someone else's
component units insurance resources
Statement of Net Assets, Balance Sheet,Statement Statement of Net Assets, Statement of Fiduciary
Statement of Activities of Revenues, Statement of Revenues, Net Assets,Statement of
Required Financial Expenditures and Fund Expenses and Changes in Changes in Fiduciary Net
Statements Balances Fund Net Assets, Assets
Statement of Cash Flows
Accrual accounting and Modified accrual Accrual accounting and Accrual accounting and
Accounting basis and economic resources focus. accounting and current economic resources focus economic resources focus
measurement focus financial resources focus
All assets and liabilities, Only assets expected to All assets and liabilities, All assets and liabilities
both financial and capital, be used up and liabilities both financial and capital, both short-term and long-
Types of accountability short-term and long-term that become due during and short-term and long- term;the Academy's
information the year or soon term. funds do not currently
thereafter. No capital include capital assets,
assets included. although they can.
All revenues and Revenue for which cash is All revenues and All revenues and
expenses during year, received during or soon expenses during year, expenses during year,
regardless of when cash is after the end of the year, regardless of when cash is regardless of when cash is
Types of Inflow/outflow received or paid. expenditures when goods received or paid. received or paid.
Information or services have been
received and payment is
due during the year or
soon thereafter.
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Component Unit
The government-wide financial statements also present the activity of Westlake Academy Foundation, a discretely presented
component unit. The Foundation was organized exclusively for charitable and educational purposes and provides funds to
help support the Academy. During 2012, the Foundation contributed $1,017,773 to the Academy to enhance educational
opportunities.
Fund Financial Statements
The fund financial statements provide more detailed information about the Academy's most significant funds—not the
Academy as a whole. Funds are accounting devices that the Academy uses to keep track of specific sources of funding and
spending for particular purposes.
• Some funds are required by State law and by bond covenants.
• The Board of Trustees establishes other funds to control and manage money for particular purposes or
to show that it is properly using certain taxes and grants.
Below are the three types of funds. The Academy had only"Governmental Funds"and"Fiduciary Funds"for the year ended
August 31,2012.
• Governmental funds—Most of the Academy's basic services are included in governmental funds,
which focus on (1) how cash and other financial assets that can readily be converted to cash flow in
and out and (2) the balances left at year-end that are available for spending. Consequently, the
governmental fund statements provide a detailed short-term view that helps you determine whether
there are more or fewer financial resources that can be spent in the near future to finance the
Academy's programs. Because this information does not encompass the additional long-term focus of
the government-wide statements,we provide additional information at the bottom of the governmental
funds statement,or on the subsequent page,that explain the relationship(or differences)between them.
• Fiduciary funds—Some schools are the trustee, or fiduciary, for certain funds. It is also responsible
for other assets that—because of a trust arrangement—can be used only for the trust beneficiaries.
These schools are responsible for ensuring that the assets reported in these funds are used for their
intended purposes. All of these fiduciary activities are reported in a separate statement of fiduciary net
assets and a statement of changes in fiduciary net assets. These activities are excluded from the
school's government-wide financial statements because they cannot use these assets to finance their
operations.
• Proprietary funds—(None at August 31, 2012). Services for which the Academy would charge
customers a fee are generally reported in proprietary funds. Proprietary funds, like the government-
wide statements,provide both long and short-term financial information.
• Internal Service funds report activities that provide supplies and services for the Academy's other
programs and activities–such as a School's Self Insurance Fund or Print Shop.
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FINANCIAL ANALYSIS OF THE ACADEMY AS A WHOLE
Net assets. The Academy's combined net assets were$2,080,606 at August 31,2012. (See Table A-1).
Table A-1
Westlake Academy's Net Assets
Governmental Activities Component Unit Activities Totals
2012 2011 2012 2011 2012 2011
Current assets $ 963,265 $ 1,244,168 $ 1,363,031 $ 955,288 $ 2,326,296 $ 2,199,456
Other assets - - 3,083 56,843 3,083 56,843
Total assets 963,265 1,244,168 1,366,114 1,012,131 2,329,379 2,256,299
Current liabilities 144,175 327,207 104,598 8,791 248,773 335,998
Total liabilities 144,175 327,207 104,598 8,791 248,773 335,998
Net assets:
Restricted 60,963 31,596 1,003,789 597,171 1,064,752 628,767
Unrestricted 758,127 885,365 257,727 406,169 1,015,854 1,291,534
Total net assets $ 819,090 $ 916,961 $ 1,261,516 $ 1,003,340 $ 2,080,606 $ 1,920,301
Figure A-2
Westlake Academy
Sources of Revenue for Fiscal Year 2012
Charges for Gifts,Bequests&
Services Miscellaneous
3% 12%
Interest
0%
Operating Grants
State Funding &Contributions
72% 13%
Changes in net assets. The Academy's total revenues were $5,752,275. A significant portion, 72%, of the Academy's
revenue came from state funding. (See Figure A-2). 13% of total revenues were from operating grants and contributions,
12%from gifts,bequests and miscellaneous,less than 1%from interest and 3%from charges for services.
The total cost of all programs and services was $5,793,560; 57% of these costs are for instructional and instructional related
costs.
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Table A-3
Westlake Academy's Changes in Net Assets
Governmental Activities Component Unit Activities Totals
2012 2011 2012 2011 2012 2011
Revenues
Program revenues:
Charges for services $ 195,059 $ 99,638 $ - $ - $ 195,059 $ 99,638
Operating grants and
contributions 740,756 548,179 1,486,329 1,085,568 2,227,085 1,633,747
General revenues:
Grants and contributions
non restricted 4,129,085 3,744,757 - - 4,129,085 3,744,757
Investment earnings 2,417 2,295 27,258 1,841 29,675 4,136
Miscellaneous 684,958 582,440 - - 684,958 582,440
Total revenues 5,752,275 4,977,309 1,513,587 1,087,409 7,265,862 6,064,718
Expenses
Instruction and instructional
related 3,334,157 2,949,351 - - 3,334,157 2,949,351
Instructional leadership/
school administration 483,476 420,197 - - 483,476 420,197
Guidance,social work,
health,transportation 293,336 218,758 - - 293,336 218,758
Food services 11,517 7,275 - - 11,517 7,275
Extracurricular activities 131,971 105,472 - - 131,971 105,472
General administration 675,764 301,672 - - 675,764 301,672
Facilities maintenance and
operations 596,913 525,273 - - 596,913 525,273
Data processing services 173,586 154,962 - - 173,586 154,962
Community services 76,880 69,739 - - 76,880 69,739
Program/support services - - 1,255,411 873,372 1,255,411 873,372
Capital Outlay 15,960 132,286 - - 15,960 132,286
Total expenses 5,793,560 4,884,985 1,255,411 873,372 7,048,971 5,758,357
Increase in net assets ( 41,285) 92,324 258,176 214,037 216,891 306,361
before Transfers
Special items 67,760 - - - 67,760 -
Extrodinary items ( 124,346) 56,704 - - ( 124,346) 56,704
Increase in net assets ( 97,871) 149,028 258,176 214,037 160,305 363,065
Beginning net assets 916,961 767,933 1,003,340 789,303 1,920,301 1,557,236
Ending net assets $ 819,090 $ 916,961 $ 1,261,516 $ 1,003,340 $ 2,080,606 $ 1,920,301
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Table A-4(below)presents the cost of each of the Academy's largest functions as well as each function's net cost(total cost
less fees generated by the activities and intergovernmental aid). The net cost reflects what was funded by state revenues as
well as local tax dollars.
• The cost of governmental activities this year was$5,793,560.
• Some of the cost was paid by those who directly benefited from the programs,$195,059.
• By grants and contributions$740,756.
Table A-4
Westlake Academy's Net Cost of Selected Functions
Total% Total%
Total Cost of Services Change Net Cost of Services Change
2012 2011 2011-2012 2012 2011 2011-2012
Instruction $ 3,170,373 $ 2,764,021 15% $ 2,606,387 $ 2,291,988 14%
School leadership 347,515 294,931 18% 322,495 283,305 14%
Guidance,counceling
and evaluation services 232,419 165,245 41% 218,179 157,403 39%
General administration 675,764 301,672 124% 646,971 275,978 134%
Facilities maintenance
and operations 596,913 525,273 14% 581,969 524,027 11%
Data processing services 173,586 154,962 12% 153,697 146,822 5%
FINANCIAL ANALYSIS
The following analysis focuses on the net assets (Table A-1) and changes in net assets (Table A-3) of the Academy's
governmental activities.
Net assets of the Academy's governmental activities decreased from$916,961 to$819,090. Unrestricted net assets-the part
of net assets that can be used to finance day-to-day operations without constraints established by debt covenants, enabling
legislation,or other legal requirements-was$758,127 and$885,365 at August 31,2012 and 2011,respectively.
This decrease in governmental net assets was the net result of several factors. The primary reason for the decrease in the
governmental activities is an increase in instructional and instructional related expenses and general administration expenses
of$758,898 from the prior year. Operating grants and contributions increased $192,577 and grants and contributions non
restricted increased$384,328 to offset an overall increase of$908,575 in total governmental expenses.
General Fund Budgetary Highlights
Over the course of the year, the Academy revised its budget by decreasing revenues by $48,603 and increasing expenditures
by $79,785. This increase was due primarily to the hiring of new staff members in the Special Education program and
instructional aides for classes that grew due to enrollment growth. At year-end,actual expenditures were$126,535 below the
amended budget.
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS
• General Fund revenues are budgeted to increase 8% over 2011-12 actual revenues. This $424,446 rise is in part
attributable to an increase in the total number of students attending the Academy. In FY 2011-12 the Academy
added a third section of 20 students in Grade 7 through Grade 11 and did the same in Grade 12 for FY 2012-13. The
remaining increase is due to an additional contribution from the Westlake Academy Foundation of$300K as well as
the increase of the Blacksmith Apprentice Program of approximately$40K.
• Amounts available for appropriation in the General Fund budget are $5,627,225, an increase of 6% over the final
2012 expenditures of$5,287,696. The major portion of this total $339,529 increase is attributed to the following
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which in-part includes an increased use of international teachers, additional school leadership, and increased
instructional supplies and materials.
Instructional Salary Related Expenditures
Desired Outcome:High Student Achievement
• In FY12/13 we will have 69.93 full-time equivalent employees (FTE's), an increase of 2.45 FTE's. The
increase in expenditures is the result of a combination of adding new positions,the years of experience our new
teachers,an increase in unemployment insurance and other employer contributions,as well as the increased cost
associated with teacher classifications and international teacher stipends.
Lapse of Education Job Grant(Federal Funding to Save Teaching Positions)
Desired Outcome:High Student Achievement
• In FY 11/12 the Academy received$91,375 in a federal entitlement grant for teacher retention. This was a one
year grant that was utilized to offset the salaries of approximately 1.75 FTE teaching positions. With the lapse
of the federal funding,these teaching positions were moved back into the General Fund.
Employee Compensation and Benefits Desired Outcomes:Effective Educators&Staff—High Student Achievement
• In FY 11/12 the Board directed staff to prepare the budget holding teachers' salaries flat. In FY 11/12 several
of the surrounding districts increased their teacher pay and in order to maintain the Board policy of being within
3%of the median, it will be necessary to increase salaries 1% in FY 12/13. With over 70%of the Academy's
expenditures being directly related to employee pay and benefits, it is important that we offer competitive
salaries,wages,and benefits to attract and retain a strong faculty base,even in a difficult economy.
Media&Resource(Library)
Desired Outcome:High Student Achievement
• With the renovation to the Scott Bradley Library and the introduction of the Media Center / Research
environment, the staffing requirements shifted and two full-time teachers will be working with students in the
PYP,MYP,and DP program on computer aided research and database utilization skills.
Athletics Department
• The majority of this cost increase is related to the experience level of the Athletic Director, the increase in
expenditures of assigned funds for equipment and uniform replacement, and anticipation of greater participation
in athletics, requiring additional field rentals,referees, etc. The Academy collects player fees to help offset the
cost of extra-curricular activities.
Professional Development
Desired Outcome:Effective Educators&Staff-High Student Achievement
• In FY 11/12, Westlake Academy received thousands of dollars in special revenue funds (grants) targeting
professional development. Without the renewal of all these grants, the professional development budget was
moved back into the General Fund.
Ending In-Direct Operating Cost Transfer from Academy Budget to Town Budget
Desired Outcome:Financial Stewardship and Responsibility
• In FY 11/12 the Academy reimbursed the Town for the in-direct operating costs for administrative services
shared with the Town of Westlake. This includes the Superintendent, Finance Director, Human Resources
Director, Facilities Director, and support personnel. This had been paid by the Town of Westlake from the
inception of the school in 2003. The amount represents $325,000 less the 25%portion of the IT Tech and the
Maintenance Engineer for time allocated to the Town.
If the FY 2011-12 budget estimates are realized, the Academy's General Fund's budgetary fund balance is expected to
increase by$28,490 by the close of FY 2013.
ACHIEVEMENTS DURING FISCAL YEAR 2011-2012
Academy Accomplishments
• Ranked#36 in the United States in the Washington Post Challenge Index
• Ranked#18 in the United States by Newsweek
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• Ranked#5 in the State of Texas,#6 against all Charter Schools in the United States,and#37 out of approximately
22,000 public high schools in the United States by U.S.News&World Report
• In 2012,WA students achieved the IB Diploma well above the world rate with 89%of the students earning the
diploma.
• Westlake Academy's TAKS(Texas Assessment of Knowledge and Skill)scores are notably higher than the average
state scores.
• Westlake Academy earned an Exemplary rating, the highest category recognized by the state's accountability
system.
• Westlake Academy received the Distinguished Budget Presentation Award from the Government Finance Officers
Association.
• The Academy received the Meritorious Budget Award from the Association of School Business Officials
International(ASBO).
• For the past two years,WA students have consistently had a higher overall AP pass rate when compared to both
Texas and the World.
• In 2012,over one third of the students who took AP exams earned the distinction of being an AP Scholar,AP
Scholar with Honors,or AP Scholar with Distinction.
Staff Accomplishments
• Several faculty members continue to represent the International Baccalaureate as Workshop Leaders, Site Visitors
and Consultants.
• One faculty member continues to serve as an IB Diploma Assistant Examiner for HL Biology
Student Accomplishments
• Twenty-four WA graduates from the Class of 2012 received the prestigious IB Diploma. In addition,these students
scored above the world average.
• The entire Senior class of 28 students received $3.52 million in scholarship and grant offers. All 28 were accepted
into respected colleges/universities across the State and the U.S.
• Eleven(11)WA students received the distinguished honor of AP Scholar for scoring 3 or higher on three or more
AP exams.
Athletic Achievements
• Varsity Cross Country ■ Varsity Men's Basketball
Women's team- State Champions Division 1 quarter finals-TCAF state tournament
District Runner-Up
• Varsity Volleyball
Final four TCAF State Tournament ■ Junior Varsity Men's Basketball
District Champions District Champions
2nd place District tournament
• Varsity Co-Ed Soccer
TCAF State Champions ■ Varsity Baseball
District Runner-up TCAF State Tournament Runner-up
District Champions
• Varsity Women's Basketball
Division 1 TCAF State Champions ■ Golf
District Champions Qualifier TCAF State Tournament
• Junior Varsity Women's Basketball ■ Tennis
District Champions Women's Doubles-3rd Place State Tournament
Mixed Doubles—2"d Place State Tournament
CONTACTING THE ACADEMY'S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general
overview of the Academy's finances and to demonstrate the Academy's accountability for the money it receives. If you have
questions about this report or need additional financial information, contact the Academy/Town Finance Director, Debbie Piper,
at 817-490-5712, or by writing to 3 Village Circle, Suite 202, Westlake,Texas 76262.
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EXHIBIT A-1
WESTLAKE ACADEMY
STATEMENT OF NET ASSETS
AUGUST 31,2012
1 4
Primary
Government Component Unit
Data
Control Governmental Component
Codes Activities Unit
ASSETS
1110 Cash and Cash Equivalents $ 681,517 $ 763,931
1120 Current Investments 100 599,100
1240 Due from Other Governments 176,764 -
1290 Other Receivables,net 30,051 196
1410 Deferred Expenses 74,833 2,887
1000 Total Assets 963,265 1,366,114
LIABILITIES
2110 Accounts Payable 73,428 31,578
2150 Payroll Deductions&Withholdings 2,316 -
2180 Due to Other Governments 17,777 -
2300 Deferred Revenues 50,654 73,020
2000 Total Liabilities 144,175 104,598
NET ASSETS
3890 Restricted for Other Purposes 60,963 1,003,789
3960 Unrestricted Net Assets 758,127 257,727
3000 Total Net Assets $ 819,090 $ 1,261,516
The notes to the financial statements are an integral part of this statement.
12
WESTLAKE ACADEMY
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED AUGUST 31,2012
Program Revenues
Data 1 3 4
Control Operating
Charges for Grants and
Codes Expenses Services Contributions
Primary Government:
GOVERNMENTAL ACTIVITIES:
11 Instruction $ 3,170,373 $ 60,259 $ 503,727
12 Instructional Resources and Media Services 89,129 - 19,149
13 Curriculum and Staff Development 74,655 - 63,676
21 Instructional Leadership 135,961 - 9,770
23 School Leadership 347,515 - 25,020
31 Guidance,Counseling and Evaluation Services 232,419 - 14,240
33 Health Services 60,917 - 2,369
35 Food Services 11,517 4,000 672
36 Extracurricular Activities 131,971 130,800 33,351
41 General Administration 675,764 - 28,793
51 Facilities Maintenance and Operations 596,913 - 14,944
53 Data Processing Services 173,586 - 19,889
61 Community Services 76,880 - 5,156
81 Capital Outlay 15,960 - -
[TP] TOTAL PRIMARY GOVERNMENT: $ 5,793,560 $ 195,059 $ 740,756
Component Unit:
1C Nonmajor Component Unit $ 1,255,411 $ - $ 1,486,329
[TC] TOTAL COMPONENT UNIT: $ 1,255,411 $ - $ 1,486,329
Data
Control General Revenues:
Codes
Taxes:
GC Grants and Contributions not Restricted
lE Investment Earnings
Ml Miscellaneous Local and Intermediate Revenue
S1 Special Item-
E2 Extraordinary Item-(Use)
TR Total General Revenues and Special Items and
CN Change in Net Assets
NB Net Assets--Beginning
NE Net Assets--Ending
The notes to the financial statements are an integral part of this statement.
13
EXHIBIT B-1
Net(Expense)Revenue and
Changes in Net Assets
6 9
Primary Government Component Unit
Governmental Component
Activities Unit
$ (2,606,387) $ -
(69,980) -
(10,979) -
(126,191) -
(322,495) -
(218,179) -
(58,548) -
(6,845) -
32,180 -
(646,971) -
(581,969) -
(153,697) -
(71,724) -
(15,960) -
(4,857,745)
230,918
- 230,918
4,129,085 -
2,417 27,258
684,958 -
67,760 -
(124,346) -
4,759,874 27,258
(97,871) 258,176
916,961 1,003,340
$ 819,090 $ 1,261,516
14
WESTLAKE ACADEMY
BALANCESHEET
GOVERNMENTAL FUNDS
AUGUST 31,2012
Data 10 WAF Purpose
Control General Whole School Designed
Codes
Fund Prof.Dev, Student Desks
ASSETS
1110 Cash and Cash Equivalents $ 633,060 $ 12,799 $
1120 Investments-Current 100 - -
1240 Receivables from Other Governments 158,120 - -
1260 Due from Other Funds 18,644 - -
1290 Other Receivables 3,429 - 26,622
1410 Deferred Expenditures 60,963 13,585 -
1000 Total Assets $ 874,316 $ 26,384 $ 26,622
LIABILITIES AND FUND BALANCES
Liabilities:
2110 Accounts Payable $ 39,736 $ - $ 26,622
2150 Payroll Deductions and Withholdings Payable 2,316 - -
2170 Due to Other Funds -
2180 Due to Other Governments 17,777 - -
2300 Deferred Revenues - 26,384 -
2000 Total Liabilities 59,829 26,384 26,622
Fund Balances:
Nonspendable Fund Balance:
3430 Prepaid Items 60,963 - -
Committed Fund Balance:
3545 Other Committed Fund Balance - -
Assigned Fund Balance:
3590 Other Assigned Fund Balance 5,665 - -
3600 Unassigned Fund Balance 747,859 - -
3000 Total Fund Balances 814,487 - -
4000 Total Liabilities and Fund Balances $ 874,316 $ 26,384 $ 26,622
The notes to the financial statements are an integral part of this statement.
15
EXHIBIT C-1
Total
Other Governmental
Funds Funds
$ 35,658 $ 681,517
- 100
18,644 176,764
- 18,644
- 30,051
285 74,833
$ 54,587 $ 981,909
$ 7,070 $ 73,428
- 2,316
18,644 18,644
- 17,777
24,270 50,654
49,984 162,819
- 60,963
4,603 4,603
- 5,665
747,859
4,603 819,090
$ 54,587 $ 981,909
16
WESTLAKE ACADEMY
STATEMENT OF REVENUES,EXPENDITURES,AND CHANGES IN FUND BALANCE
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED AUGUST 31,2012
Data 10 WAF Purpose
Control General Whole School Designed
Codes Fund Prof.Dev. Student Desks
REVENUES:
5700 Total Local and Intermediate Sources $ 881,249 $ 39,615 $ 26,622
5800 State Program Revenues 4,362,921 - -
5900 Federal Program Revenues - - -
5020 Total Revenues 5,244,170 39,615 26,622
EXPENDITURES:
Current:
0011 Instruction 2,825,528 282 26,622
0012 Instructional Resources and Media Services 74,628 - -
0013 Curriculum and Instructional Staff Development 9,732 36,843 -
0021 Instructional Leadership 134,839 390 -
0023 School Leadership 341,469 1,401 -
0031 Guidance,Counseling and Evaluation Services 229,067 699 -
0033 Health Services 60,917 - -
0035 Food Services 11,517 - -
0036 Extracurricular Activities 103,130 - -
0041 General Administration 655,150 - -
005 1 Facilities Maintenance and Operations 584,891 - -
0053 Data Processing Services 164,049 - -
0061 Community Services 76,880 - -
Capital Outlay:
0081 Facilities Acquisition and Construction 15,960 - -
6030 Total Expenditures 5,287,757 39,615 26,622
1100 Excess(Deficiencv)of Revenues Over(Under) (43,587) - -
Expenditures
OTHER FINANCING SOURCES(USES):
7915 Transfers In 26,124 - -
8911 Transfers Out(Use) (26,124) - -
7080 Total Other Financing Sources(Uses) - - -
SPECIAL AND EXTRAORDINARY ITEMS:
7918 Special Item-Resource 67,760 -
8913 Extraordinary Item-(Use) (124,346) - -
1200 - — -
Net Change in Fund Balances (100,173) - -
0100 Fund Balance-September I (Beginning) 914,660 - -
3000 Fund Balance-August 31 (Ending) $ 814,487
i
The notes to the financial statements are an integral part of this statement.
17
EXHIBIT C-3
Total
Other Governmental
Funds Funds
$ 282,803 $ 1,230,289
6,714 4,369,635
152,351 152,351
441,868 5,752,275
317,941 3,170,373
14,501 89,129
28,080 74,655
732 135,961
4,645 347,515
2,653 232,419
- 60,917
- 11,517
28,841 131,971
20,614 675,764
12,022 596,913
9,537 173,586
- 76,880
- 15,960
439,566 5,793,560
2,302 (41,285)
- 26,124
(26,124)
67,760
(124,346)
2,302 --- (97,871)
2,301 916,961
$ 4,603 $ 819,090
18
EXHIBIT D-1
WESTLAKE ACADEMY
STATEMENT OF FIDUCIARY NET ASSETS
FIDUCIARY FUNDS
AUGUST 31,2012
Agency
Fund
ASSETS
Cash and Cash Equivalents $ 66,888
Total Assets $ 66,888
LIABILITIES
Accounts Payable $ 3,661
Due to Student Groups 63,227
Total Liabilities $ 66,888
The notes to the financial statements are an integral part of this statement.
19
WESTLAKE ACADEMY
(A COMPONENT UNIT OF THE TOWN OF WESTLAKE)
NOTES TO THE FINANCIAL STATEMENTS
AUGUST 31,2012
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
Westlake Academy (the "Academy"), a blended component unit of the Town of Westlake (the "Town"), is a
Texas nonprofit Corporation under Chapter 12, Subchapter D of the Education Code to provide education. The
Board of Trustees (the "Board") consists of six trustees and is appointed by the Town's governing body.
Currently, all members of the Board are members of the Town's governing body. The Academy prepares its
basic financial statements in conformity with generally accepted accounting principles promulgated by the
Governmental Accounting Standards Board (the "GASB") and other authoritative sources identified in
Statement on Auditing Standards No. 69 of the American Institute of Certified Public Accountants; and it
complies with the requirements of the appropriate version of Texas Education Agency's Financial
Accountability System Resource Guide(the"Resource Guide")and the requirements of contracts and grants of
agencies from which it receives funds.
The Board is appointed by the governing Council of the Town and it has the authority to make decisions,
appoint administrators and managers, and significantly influence operations. It also has the primary
accountability for fiscal matters. Therefore,the Academy is a financial reporting entity as defined by the GASB
in its Statement No. 14,"The Financial Reporting Entity."
The Academy's basic financial statements include a separate entity that is controlled by or dependent on the
Academy. The determination to include separate entities is based on the criteria of GASB Statement No. 14,
"The Financial Reporting Entity" as amended by GASB Statement No. 39, "Determining Whether Certain
Organizations Are Component Units." GASB defines the reporting entity as the primary government and those
component units for which the primary government is financially accountable. To be financially accountable, a
voting majority of the component unit's ruling body must be appointed by the primary government, and either
(a) the primary government must be able to impose its will, or (b) the primary government may potentially
benefit financially or be financially responsible for the component unit.
The Westlake Academy Foundation (the "Foundation") is a 501(c)3 nonprofit organization which was
established exclusively for the purposes of supporting the Academy. This includes fundraising for and
contributing raised funds to the Academy. The Foundation has been discretely presented in the accompanying
financial statements and reported in a separate column to emphasize that it is legally separate from the
Academy. See Note II E for additional information relating to the Foundation. Separate audited financial
statements of the Foundation are available from the Academy/Town Finance Director's office, #3 Village
Circle, Suite 202,Westlake,Texas 76262.
B. Government-wide and Fund Financial Statements
The Statement of Net Assets and the Statement of Activities are government-wide financial statements. They
report information on all of the Academy's nonfiduciary activities with most of the interfund activities removed.
Governmental activities include programs supported primarily by state and federal grants,the Foundation,and the
Town. The Academy has no business-type activities that rely to a significant extent, on fees and charges for
support.
i
(continued)
20
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
B. Government-wide and Fund Financial Statements(Continued)
Neither fiduciary funds nor component units that are fiduciary in nature are included.
The Statement of Activities demonstrates how other people or entities that participate in programs the Academy
operates have shared in the payment of the direct costs. Direct expenses are those that are clearly identifiable
with a specific function or segment. The"charges for services"column includes payments made by parties that
purchase, use, or directly benefit from goods or services provided by a given function or segment of the
Academy. The primary example is school lunch charges. The "grants and contributions" column includes
amounts paid by organizations outside the Academy to help meet the operational or capital requirements of a
given function. Examples include grants under the Elementary and Secondary Education Act. If revenue is not
program revenue,it is general revenue used to support all of the Academy's functions.
Interfund activities between governmental funds appear as due to/due from on the Governmental Fund Balance
Sheet and as other resources and other uses on the Governmental Fund Statement of Revenues, Expenditures
and Changes in Fund Balance. All interfund transactions between governmental funds are eliminated on the
government-wide statements. Interfund activities between governmental funds and fiduciary funds remain as
due to/due from on the government-wide Statement of Activities.
The fund financial statements provide reports on the financial condition and results of operations for three fund
categories—governmental, proprietary, and fiduciary. Since the resources in the fiduciary funds cannot be used
for Academy operations,they are not included in the government-wide statements. The Academy considers some
governmental funds major and reports their financial condition and results of operations in a separate column.
C. Measurement Focus,Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement focus and
the accrual basis of accounting. Revenue is recorded when earned and expenses are recorded when a liability is
incurred, regardless of the timing of related cash flows. Grants and similar items are recognized as revenue as
soon as all eligibility requirements imposed by the provider have been met.
Governmental fund financial statements use the current financial resources measurement focus and the
modified accrual basis of accounting. With this measurement focus, only current assets, current liabilities and
fund balances are included on the balance sheet. Operating statements of these funds present net increases and
decreases in current assets (i.e. revenues and other financing sources and expenditures and other financing
uses).
The modified accrual basis of accounting recognizes revenues in the accounting period in which they become
both measurable and available and it recognizes expenditures in the accounting period in which the fund
liability is incurred, if measurable. The expenditures related to certain compensated absences and claims and
judgments are recognized when the obligations are expected to be liquidated with expendable available
financial resources. The Academy considers all revenues available if they are collectible within 60 days after
year-end.
Miscellaneous revenues are recorded as revenue when received in cash because they are generally not
measurable until actually received. Investment earnings are recorded as earned, since they are both measurable
and available.
Grant funds are considered to be earned to the extent of expenditures made under the provisions of the grant.
Accordingly, when such funds are received, they are recorded as deferred revenues until related and authorized
expenditures have been made. If balances have not been expended by the end of the project period, grantors
sometimes require the Academy to refund all or part of the unused amount.
(continued)
21
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(Continued)
C. Measurement Focus,Basis of Accounting and Financial Statement Presentation (Continued)
The proprietary fund types and fiduciary funds are accounted for on a flow of economic resources measurement
focus and utilize the accrual basis of accounting. This basis of accounting recognizes revenues in the
accounting period in which they are earned and become measurable and expenses in the accounting period in
which they are incurred and become measurable. The Academy applies all GASB pronouncements as well as
the Financial Accounting Standards Board pronouncements issued on or before November 30, 1989, unless
these pronouncements conflict or contradict GASB pronouncements. With this measurement focus, all assets
and all liabilities associated with the operation of these funds are included on the fund Statement of Net Assets.
The fund equity is segregated into restricted net assets,and unrestricted net assets.
D. Fund Accounting
The Academy reports the following major governmental fund:
The General Fund is the Academy's primary operating fund. It accounts for all financial
resources except those required to be accounted for in another fund.
The Purpose Designed Student Desks Fund is a special revenue grant from Westlake Academy
Foundation to provide students in the upper grades of the PYP with pod designed furniture that
will use the classroom space more efficiently.
The WAF Whole School Professional Development Fund is a special revenue grant fund from
Westlake Academy Foundation that provides ongoing professional development for Westlake
Academy faculty in International Baccalaureate courses,related curriculum and leadership fields.
Additionally,the Academy reports the following fund types:
The Special Revenue Funds account for resources restricted to, or designated for, specific
purposes by the Academy or a grantor in a Special Revenue Fund. Most federal and some state
financial assistance is accounted for in a Special Revenue Fund and sometimes unused balances
must be returned to the grantor at the close of specified project period.
Agency Funds account for resources held for others in a custodial capacity. Fiduciary funds are
reported in the fiduciary fund financial statements. However, because these assets are not
available to support Academy programs, these funds are not included in the government-wide
statements. The Academy's Agency Fund is a Student Activity Fund.
E. Other Accounting Policies
1. The State of Texas(the"State")has created a state minimum personal leave program consisting of five
days per year personal leave with no limit on accumulation and transferability among districts shall be
provided for school district employees. Each District's local Board is required to establish a personal
leave plan. It is the Academy's policy to permit some employees to accumulate earned but unused
state and local personal leave pay benefits. There is no liability for unpaid accumulated personal leave
since the Academy does not have a policy to pay any amounts when employees separate from service
with the government. All vacation pay is accrued when incurred in the government-wide financial
statements. A liability for these amounts is reported in governmental funds only if they have matured,
for example,as a result of employee resignations and retirements.
2. The Data Control Codes refer to the account code structure prescribed by the Texas Education Agency
(TEA) in the Financial Accountability System Resource Guide. TEA requires the Academy to display
these codes in the financial statements filed with the Agency in order to insure accuracy in building a
statewide database for policy development and funding plan.
(continued)
22
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(Continued)
E. Other Accounting Policies(Continued)
3. When an expenditure is incurred for purposes for which both restricted or unrestricted fund balance is
available, the Academy considers restricted funds to have been spent first. When an expenditure is
incurred for which committed, assigned, or unassigned fund balances are available, the District
considers amounts to have been spent first out of committed funds, then assigned funds, and finally
unassigned funds.
4. For purposes of the statement of cash flows for proprietary and similar fund types, the Academy
considers highly liquid investments to be cash equivalents if they have a maturity of three months or
less when purchased.
5. The governmental fund financial statements present fund balances based on classifications that
comprise a hierarchy that is based primarily on the extent to which the District is bound to honor
constraints on the specific purposes for which amounts in the respective governmental funds can be
spent. The classifications used in the governmental fund financial statements are as follows:
• Nonspendable: This classification includes amounts that cannot be spent because they
are either (a) not in spendable form or (b) are legally or contractually required to be
maintained intact. Nonspendable items are not expected to be converted to cash or are
not expected to be converted to cash within the next year.
• Restricted: This classification includes amounts for which constraints have been placed
on the use of the resources either (a) externally imposed by creditors, grantors,
contributors, or laws or regulations of other governments, or(b) imposed by law through
constitutional provisions or enabling legislation.
• Committed: This classification includes amounts that can be used only for specific
purposes pursuant to constraints imposed by board resolution of the School Board, the
District's highest level of decision making authority. These amounts cannot be used for
any other purpose unless the School Board removes or changes the specified use by
taking the same type of action that was employed when the funds were initially
committed. This classification also includes contractual obligations to the extent that
existing resources have been specifically committed for use in satisfying those
contractual requirements.
• Assigned: This classification includes amounts that are constrained by the District's
intent to be used for a specific purpose but are neither restricted nor committed. This
intent can be expressed by the School Board.
• Unassigned: This classification includes the residual fund balance for the General Fund.
The unassigned classification also includes negative residual fund balance of any other
governmental fund that cannot be eliminated by offsetting of assigned fund balance
amounts.
6. Net assets represent the difference between assets and liabilities. Net assets are reported as restricted
when there are limitations imposed on their use either though the enabling legislations adopted by the
Academy or through external restrictions imposed by creditors, grantors or laws or regulations of other
governments.
7. The preparation of financial statements in conformity with accounting principles generally accepted in
the United States of America requires management to make estimates and assumptions that affect
certain reported amounts and disclosures.Accordingly,actual results could differ from those estimates.
The amount of state foundation revenue a school district earns for a year can and does vary until the
time when final values for each of the factors in the formula become available. Availability can be as
late as midway into the next fiscal year. It is at least reasonably possible that the foundation revenue
estimates as of August 31,2012,will change.
(continued)
23
II. DETAILED NOTES ON ALL FUNDS
A. Deposits and Investments
The funds of the Academy must be deposited and invested under the terms of a contract, contents of which are
set out in the Depository Contract Law. The depository bank places approved pledged securities for
safekeeping and trust with the Academy's agent bank in an amount sufficient to protect Academy funds on a
day-to-day basis during the period of the contract. The pledge of approved securities is waived only to the
extent of the depository bank's dollar amount of Federal Deposit Insurance Corporation("FDIC")insurance.
At August 31, 2012,the carrying amount of the Academy's deposits (cash, certificates of deposit, and interest-
bearing savings accounts included in temporary investments)was$748,405 and the bank balance was$791,578.
The Public Funds Investment Act(Government Code Chapter 2256)contains specific provisions in the areas of
investment practices, management reports and establishment of appropriate policies. Among other things, it
requires the Academy to adopt, implement, and publicize an investment policy. That policy must address the
following areas: (1)safety of principal and liquidity,(2)portfolio diversification,(3)allowable investments,(4)
acceptable risk levels, (5) expected rates of return, (6) maximum allowable stated maturity of portfolio
investments, (7) maximum average dollar-weighted maturity allowed based on the stated maturity date for the
portfolio, (8) investment staff quality and capabilities, and (9) bid solicitation preferences for certificates of
deposit. Statutes authorize the Academy to invest in (1) obligations of the U. S. Treasury, certain U. S.
agencies, and the State of Texas; (2) certificates of deposit, (3) certain municipal securities, (4) money market
savings accounts, (5) repurchase agreements, (6) bankers acceptances, (7) mutual funds, (8) investment pools,
(9)guaranteed investment contracts, and(10) common trust funds. The Act also requires the Academy to have
independent auditors perform test procedures related to investment practices as provided by the Act. The
Academy is in substantial compliance with the requirements of the Act and with local policies.
The carrying value of investments at August 31, 2012, was $100 (Texas Local Government Investment Pool).
Local government investment pools operate in a manner consistent with the SEC's Rule 2a7 of the Investment
Company Act of 1940. Local government investment pools use amortized cost rather than market value to
report net assets to compute share prices. Accordingly,the fair value of the position of these pools is the same
as the value of the shares in each pool.
TexPool is organized in conformity with the Interlocal Cooperation Act, Chapter 791 of the Texas Government
Code, and the Public Funds Investment Act, Chapter 2256 of the Texas Government Code. The Texas
Comptroller of Public Accounts is the sole officer, director and shareholder of the Texas Treasury Safekeeping
Trust Company, which is authorized to operate TexPool. In addition, the TexPool Advisory Board advises on
TexPool's Investment Policy. This Board is composed equally of participants in TexPool and other persons
who do not have a business relationship with TexPool who are qualified to advise TexPool. TexPool is subject
to annual review by an independent auditor consistent with the Public Funds Investment Act. In addition,
TexPool is subject to review by the State Auditor's office and by the Internal Auditor of the Comptroller's
office.
In compliance with the Public Funds Investment Act, the Academy has adopted a deposit and investment
policy. That policy does address the following risks:
1. Custodial Credit Risk — Deposits: This is the risk that in the event of bank failure, the
Academy's deposits may not be returned to it. The Academy was not exposed to custodial
credit risk since its deposits at year-end and during the year ended August 31, 2012, were
covered by depository insurance or by pledged collateral held by the Academy's agent bank
in the Academy's name.
2. Custodial Credit Risk— Investments: This is the risk that, in the event of the failure of the
counterparty, the Academy will not be able to recover the value of its investments or
collateral securities that are in the possession of an outside party. Investments are subject to
custodial credit risk only if they are evidenced by securities that exist in physical or book
entry form. Thus positions in external investment pools are not subject to custodial credit risk
because they are not evidenced by securities that exist in physical or book entry form.
(continued)
24
II. DETAILED NOTES ON ALL FUNDS (Continued)
A. Deposits and Investments(Continued)
3. Other Credit Risk: There is the risk that an issuer or other counterparty to an investment will
not fulfill its obligations. To minimize credit risk, TexPool invests only in investments
authorized under the Public Funds Investment Act. As of August 31, 2012, TexPool's
investments credit quality rating was AAAm(Standard&Poor's).
B. Due from Other Governments
The Academy participates in a variety of federal and state programs from which it receives grants to partially or
fully finance certain activities. Amounts due from federal and state governments as of August 31, 2012, are
summarized below. All federal grants shown below are passed through the TEA and are reported on the
financial statements as Due from Other Governments.
State Federal
Fund Entitlements Grants Total
General $ 158,120 $ - $ 158,120
Special revenue - 18,644 18,644
Total $ 158,120 $ 18,644 $ 176,764
C. Donated Use of Facilities
The Academy currently operates in facilities that are capital assets of the Town. The Academy is not required
by the Town to pay rent for the use of those facilities.
D. Interfund Balances and Activities
Interfund balances at August 31,2012,consisted of the following individual fund balances:
Due to Fund Due from Fund Amount Purpose
General Fund Non-major Funds $ 18,644 To cover expenditures
Total $ 18,644
Interfund transfers at August 31,2012,consisted of the following individual fund balances:
Transfer From Transfer To Amount Reason
To transfer funds for athletic
General Fund General Fund-Athletics $ 26,124 payroll
Total $ 26,124
(continued)
25
II. DETAILED NOTES ON ALL FUNDS(Continued)
E. Component Unit Activity
Major classes of assets, liabilities, net assets, revenues and expenses for the Foundation are reported below for
the fiscal year ended August 31,2012.
Condensed Statement of Net Assets
Assets
Cash and cash equivalents $ 763,931
Investments 599,100
Other assets,net 3,083
Total assets 1,366,114
Liabilities 104,598
Net assets
Permanently restricted 971,078
Temporarily restricted 32,711
Unrestricted 257,727
Total net assets $ 1,261,516
Statement of Activities
Revenues Expenses Total
Gallery night $ 231,624 $ 57,924 $ 173,700
Blacksmith annual fund 661,749 674,604 ( 12,855)
Capital campaign 400 68,395 ( 67,995)
Endowment 400,000 - 400,000
Westlake Baja 192,486 47,449 145,037
Fund-an-item - 72,741 ( 72,741)
Fund 100 - 166,153 ( 166,153)
Miscellaneous 70 - 70
Investment income 10,265 - 10,265
Net unrealized gains on investments ( 6,050) - ( 6,050)
Net realized gains on investments 23,043 - 23,043
Management and general - 168,145 ( 168,145)
Totals $ 1,513,587 $ 1,255,411 258,176
Beginning net assets 1,003,340
Ending net assets $ 1,261 516
The Foundation contributed$1,017,773 to the Academy during the fiscal year ended August 31,2012.
(continued)
26
II. DETAILED NOTES ON ALL FUNDS(Continued)
F. Revenue from Local and Intermediate Sources
During the current year, revenues from local and intermediate sources as reported on Exhibit C-3 of the fund
statements consisted of the following:
WAF Whole
School Purpose
Professional Designed Non-major
General Fund Development Student Desks Funds Total
Gifts and bequests $ 714,855 $ 39,615 $ - $ 251,660 $ 1,006,130
Interest 2,417 - - - 2,417
Food sales 4,000 - - - 4,000
Campus activities 43,635 - - - 43,635
Parking/transportation 49,855 - - - 49,855
Athletics 49,821 - - - 49,821
Miscellaneous 16,666 - 26,622 31,143 74,431
Total $ 881,249 $ 39,615 $ 26,622 $ 282,803 $ 1,230,289
G. Defined Benefit Pension Plan
Plan Description. Westlake Academy contributes to the Teacher Retirement System of Texas (TRS), a cost-
sharing multiple employer defined benefit pension plan. TRS administers retirement and disability annuities,
and death and survivor benefits to employees and beneficiaries of employees of the public school systems of
Texas. It operates primarily under the provisions of the Texas Constitution, Article XVI, Sec. 67, and Texas
Government Code, Title 8, Subtitle C. TRS also administers proportional retirement benefits and service credit
transfer under Texas Government Code, Title 8, Chapters 803 and 805,respectively. The Texas state legislature
has the authority to establish and amend benefit provisions of the pension plan and may, under certain
circumstances, grant special authority to the TRS Board of Trustees. TRS issues a publicly available financial
report that includes financial statements and required supplementary information for the defined benefit pension
plan. That report may be obtained by downloading the report from the TRS Internet website,
www.trs.state.tx.us,under the TRS Publications heading,by calling the TRS Communications Department at 1-
800-223-8778, or by writing to the TRS Communications Department, 1000 Red River Street, Austin, Texas
78701.
Funding Policy. Contribution requirements are not actuarially determined but are established and amended
pursuant to the following state funding policy: (1) The state constitution requires the legislature to establish a
member contribution rate of not less than 6.0% of the member's annual compensation and a state contribution
rate of not less than 6.0% and not more than 10% of the aggregate annual compensation of all members of the
system; (2) state statute prohibits benefit improvements, if as result of a particular action, the time required to
amortize TRS' unfunded actuarial liabilities would be increased to a period that exceeds 31 years, or, if the
amortization period already exceeds 31 years,the period would be increased by such action.
Contribution rates and contributions for fiscal years 2012-2010 are shown
in the table below. These rates are set by the General Appropriations Act. In
certain instances,the reporting district is required to make all or a portion of
the state's and/or member's contribution and on the portion of the
employees' salaries that exceeded the statutory minimum.
(continued)
27
II. DETAILED NOTES ON ALL FUNDS (Continued)
G. Defined Benefit Pension Plan (Continued)
Contribution Rates and Contribution Amounts
Member State
Year Rate Amount 1 Rate Amount
2012 6.4% $ 224,616 6.000% $ 188,014
2011 6.4% $ 174,332 6.644% $ 177,176
2010 6.4% $ 167,083 6.644% $ 153,552
H. Health Care Coverage
During the period ended August 31,2012, employees of the Academy were covered by a state-wide health care
plan, TRS Active Care. The Academy's participation in this plan is renewable annually. The Academy paid into
the Plan$225 per month per employee. Employees, at their option,pay premiums for any coverage above these
amounts as well as for dependent coverage.
The Teachers Retirement System (TRS) manages TRS Active Care. The medical plan is administered by Blue
Cross and Blue Shield of Texas, FIRSTCARE, and Scott and White HMO. Medco Health administers the
prescription drug plan. The latest financial information on the state-wide plan may be obtained by writing to the
TRS Communications Department, 1000 Red River Street, Austin, Texas 78701, by calling the TRS
Communications Department at 1-800-223-8778, or by downloading the report from the TRS Internet website,
www.trs.state.tx.us,under the TRS Publications heading.
I. Retiree Health Plan
Plan Description. Westlake Academy contributes to the Texas Public School Retired Employees Group
Insurance Program (TRS-Care), a cost-sharing multiple-employer defined benefit postemployment health care
plan administered by the Teacher Retirement System of Texas. TRS-Care provides health care coverage for
certain persons (and their dependents) who retired under the Teacher Retirement System of Texas. The
statutory authority for the program is Texas Insurance Code, Chapter 1575. Section 1575.052 grants the TRS
Board of Trustees the authority to establish and amend basic and optional group insurance coverage for
participants. The Teacher Retirement System of Texas issues a publicly available financial report that includes
financial statements and required supplementary information for TRS-Care. That report may be obtained by
visiting the TRS Web site at www.trs.state.tx.us under the TRS Publications heading, by calling the TRS
Communications Department at 1-800-223-8778, or by writing to the Communications Department of the
Teacher Retirement System of Texas at 1000 Red River Street,Austin,Texas 78701.
Funding Policy. Contribution requirements are not actuarially determined but are legally established each
biennium by the Texas Legislature. Texas Insurance Code, Sections 1575.202, 203, and 204 establish state,
active employee, and public school contributions, respectively. Funding for free basic coverage is provided by
the program based upon public school district payroll. Per Texas Insurance Code, Chapter 1575, the public
school contribution may not be less than 0.25% or greater than 0.75%of the salary of each active employee of
the public school. Funding for optional coverage is provided by those participants selecting the optional
coverage. Contribution rates and amounts are shown in the table below for fiscal years 2012-2010.
'I
(continued)
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II. DETAILED NOTES ON ALL FUNDS (Continued)
I. Retiree Health Plan(Continued)
Contribution Rates
Active Member State School District
Year Rate Amount Rate Amount Rate Amount
2012 0.65% $ 22,822 1.0% $ 35,111 0.55% $ 19,311
2011 0.65% $ 19,145 1.0% $ 29,454 0.55% $ 16,200
2010 0.65% $ 16,844 1.0% $ 25,914 0.55% $ 14,253
J. Retiree Health Plan
Medicare Part D— On-behalf Payments. The Medicare Prescription Drug, Improvement, and Modernization
Act of 2003, which was effective January 1, 2006, established prescription drug coverage for Medicare
beneficiaries known as Medicare Part D. One of the provisions of Medicare Part D allows for the Texas Public
School Retired Employee Group Insurance Program(TRS-Care)to receive retiree drug subsidy payments from
the federal government to offset certain prescription drug expenditures for eligible TRS-Care participants.
These on-behalf payments of$8,203, $6,430 and $6,112 were recognized for the years ended August 31, 2012,
2011 and 2010,respectively, as equal revenues and expenditures.
Early Retiree Reinsurance Program—On-behalf Payments. The Early Retiree Reinsurance Program(ERRP)is
a provision of the Patient Protection and Affordable Care Act(PPAVA). A provision of the PPAVA allows the
Texas Public School Retired Employee Group Insurance Program (TRS-Care) to receive a reimbursement from
the federal government for a portion of the cost to provide health benefits to retirees between the ages of 55 —64
and their covered dependents regardless of age. The on-behalf payment of$7,757 was recognized for the year
ended August 31,2012,as equal revenues and expenditures.
K. Risk Management
The Academy is exposed to various risk of loss related to torts, theft of, damage to and destruction of assets;
errors and omissions; injuries to employees; and natural disasters for which the Academy carries commercial
insurance. There were no settlements exceeding insurance coverage in the current fiscal year.
M. Litigation
The Town and Academy was involved in a lawsuit for wrongful termination brought by the former head of
school and his wife, a former teacher. A settlement was reached in November 2011 and was handled by the
Academy's insurance carrier.No additional liability to the Academy is anticipated.
29
EXHIBIT E-1
WESTLAKE ACADEMY
STATEMENT OF REVENUES,EXPENDITURES,AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL-GENERAL FUND
FOR THE YEAR ENDED AUGUST 31,2012
Data Actual Amounts Variance With
Control (GAAP BASIS) Final Budget
Budgeted Amounts Positive or
Codes
Original Final (Negative)
REVENUES:
5700 Total Local and Intermediate Sources $ 753,982 $ 845,112 $ 881,188 $ 36,076
5800 State Program Revenues 4,490,086 4,350,353 4,362,921 12,568
5020 Total Revenues 5,244,068 5,195,465 5,244,109 48,644
EXPENDITURES:
Current:
0011 Instruction 2,839,281 2,878,292 2,825,466 52,826
0012 Instructional Resources and Media Services 90,134 82,929 74,628 8,301
0013 Curriculum and Instructional Staff Development 87,800 30,367 9,732 20,635
0021 Instructional Leadership 131,742 137,013 134,839 2,174
0023 School Leadership 333,805 339,111 341,469 (2,358)
0031 Guidance,Counseling and Evaluation Services 220,628 233,373 229,067 4,306
0033 Health Services 59,700 60,853 60,917 (64)
0035 Food Services 9,657 12,363 11,517 846
0036 Extracurricular Activities 122,726 98,450 103,130 (4,680)
0041 General Administration 601,746 656,979 655,150 1,829
0051 Facilities Maintenance and Operations 587,169 618,362 584,892 33,470
0053 Data Processing Services 159,874 168,251 164,049 4,202
0061 Community Services 66,244 79,010 76,880 2,130
Capital Outlay:
0081 Facilities Acquisition and Construction 23,940 18,878 15,960 2,918
6030 Total Expenditures 5,334,446 5,414,231 5,287,696 126,535
1100 Excess(Deficiency)of Revenues Over(Under) (90,378) (218,766) (43,587) 175,179
Expenditures
OTHER FINANCING SOURCES(USES):
7915 Transfers In 36,967 36,967 26,124 (10,843)
8911 Transfers Out(Use) (49,807) (36,967) (26,124) 10,843
8949 Other(Uses) - (12,840) - 12,840
7080 Total Other Financing Sources(Uses) (12,840) (12,840) 12,840
SPECIAL AND EXTRAORDINARY ITEMS:
7918 Special Item-Resource - 67,877 67,760 (117)
8913 Extraordinary Item-(Use) - (124,464) (124,346) 118
1200 Net Change in Fund Balances (103,218) (288,193) (100,173) 188,020
0100 Fund Balance-September 1 (Beginning) 914,660 914,660 914,660 -
3000 Fund Balance-August 31 (Ending) $ 811,442 $ 626,467 $ 814,487 $ 188,020
30
WESTLAKE ACADEMY
(A COMPONENT UNIT OF THE TOWN OF WESTLAKE)
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
AUGUST 31,2012
Budgetary Information
The Board adopts an"appropriated budget"on a GAAP basis for the General Fund. The Academy is required to present
the adopted and final amended budgeted revenues and expenditures for this fund. The General Fund budget appears in
Exhibit E-1.
The following procedures are followed in establishing the budgetary data reflected in the basic financial statements:
1. Prior to August 25 of the preceding fiscal year,the Academy prepares a budget for the next succeeding
fiscal year beginning September 1. The operating budget includes proposed expenditures and the
means of financing them.
2. A meeting of the Board is then called for the purpose of adopting the proposed budget.
3. Prior to September 1,the budget is legally enacted through resolution by the Board. Once a budget is
approved, it can only be amended at the object function and fund level by approval of a majority of the
members of the Board. Amendments are presented to the Board at its regular meetings. Each
amendment made before the fact, is reflected in the official minutes of the Board, and is not made after
fiscal year-end.
4. Budgeted amounts are amended by the Board. All budget appropriations lapse at year-end.
5. For the year ending August 31,2012, expenditures exceeded appropriations in the following functions:
School Leadership, Health Services and Extracurricular Activities. The functions that exceeded
appropriations were funded by other various functions that were under budget.
31
WESTLAKE ACADEMY
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
AUGUST 31,2012
224 287 397 404
Data Education Advanced Student
Control IDEA-Part B Jobs Placement Success
Codes Formula Fund Incentives Initiative
ASSETS
1110 Cash and Cash Equivalents $ - $ _ $ _ $ _
1240 Receivables from Other Governments 10,856 7,788 - -
1410 Deferred Expenditures - -
1000 Total Assets $ 10,856 $ 7,788 $ - $ -
LIABILITIES AND FUND BALANCES
Liabilities:
2110 Accounts Payable $ _ $ _ $
2170 Due to Other Funds 10,856 7,788 -
23oo Deferred Revenues _
2000 Total Liabilities 10,856 7,788 - -
Fund Balances:
Committed Fund Balance:
3545 Other Committed Fund Balance -
3000 Total Fund Balances _
4000 Total Liabilities and Fund Balances $ 10,856 $ 7,788
32
EXHIBIT F-1 (Cont'd)
410 429 461 481 482 484 485 486
State Other State Campus Hudson WAF Hudson Hudson
Textbook Special Activity Foundation Fund 100 Hudson Teacher Eff.Through
Fund Revenue Funds Funds Fund Grant Internship Creativity Prof.Dev.
$ - $ - $ 4,603 $ 3,473 $ - $ - $ 9,800 $ 10,712
285 - -
$ 4,603 $ 3,473 $ 285 $ - $ 9,800 $ 10,712
3,473 285 - 9,800 10,712
- - 3,473 285 - 9,800 10,712
- 4,603 - - - -
4,603
4,603 $ 3,473 $ 285 $ - $ 9,800 $ 10,712
33
WESTLAKE ACADEMY
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
AUGUST 31,2012
487 488 489 491
Data WAF WAF WAF
Control Tech For Support Math WAF Recruitment
Codes Next Gen. Teacher Rosetta Stone Phase I
ASSETS
1110 Cash and Cash Equivalents $ _ $ _ $ _ $ _
1240 Receivables from Other Governments
1410 Deferred Expenditures
1000 Total Assets $ _ $ _ $ _ $ _
LIABILITIES AND FUND BALANCES
Liabilities:
2110 Accounts Payable $ _ $ _ $
2170 Due to Other Funds _ _
2300 Deferred Revenues _ _
2000 Total Liabilities _ _
Fund Balances:
Committed Fund Balance:
3545 Other Committed Fund Balance
3000 Total Fund Balances
4000 Total Liabilities and Fund Balances
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EXHIBIT F-1
492 494 Total
WAF WAF Nonmajor
Recruitment Library Media Governmental
Phase II Resource Funds
$ - $ 7,070 $ 35,658
- 18,644
- 285
$ - $ 7,070 $ 54,587
$ - $ 7,070 $ 7,070
- 18,644
24,270
7,070 49,984
- - 4,603
4,603
$ - $ 7,070 $ 54,587
35
WESTLAKE ACADEMY
COMBINING STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN
FUND BALANCES-NONMAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED AUGUST 31,2012
224 287 397 404
Data Education Advanced Student
Control IDEA-Part B Jobs Placement Success
Codes Formula Fund Incentives Initiative
REVENUES:
5700 Total Local and Intermediate Sources $ - $ -
5800 State Program Revenues - - - 2,200
5900 Federal Program Revenues 55,756 91,375 5,220 -
5020 Total Revenues 55,756 91,375 5,220 2,200
EXPENDITURES:
Current:
0011 Instruction 55,756 91,375 5,220 2,200
0012 Instructional Resources and Media Services - - - -
0013 Curriculum and Instructional Staff Development - - - -
0021 Instructional Leadership - - - -
0023 School Leadership - - - -
0031 Guidance,Counseling and Evaluation Services - - - -
0036 Extracurricular Activities - - - -
0041 General Administration - - - -
0051 Facilities Maintenance and Operations - - - -
0053 Data Processing Services - - - -
--- --
6030 Total Expenditures 55,756 91,375 5,220 2,200
1200 Net Change in Fund Balance - - - -
0100 Fund Balance-September 1 (Beginning) - - -
3000 Fund Balance-August 31 (Ending) $
36
EXHIBIT F-2(Cont'd)
410 429 461 481 482 484 485 486
State Other State Campus Hudson WAF Hudson Hudson
Textbook Special Activity Foundation Fund 100 Hudson Teacher Eff.Through
Fund Revenue Funds Funds Fund Grant Internship Creativity Prof.Dev.
$ - $ - $ 31,143 $ - $ 19,821 $ 35,000 $ - $ 17,718
3,566 948 - - - - - -
3,566 948 31,143 - 19,821 35,000 - 17,718
3,566 948 - - 2,979 35,000 - -
- - 13,362 - 14,718
732 - - -
- - 2,653 - - -
28,841 - - -
- - - 95 - - 3,000
3,566 948 28,841 19,821 35,000 - 17,718
- - 2,302 - - - - -
2,301 - - - - -
4,603
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37
WESTLAKE ACADEMY
COMBINING STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN
FUND BALANCES-NONMAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED AUGUST 31,2012
487 488 489 491
Data WAF WAF WAF
Control Tech For Support Math WAF Recruitment
Codes Next Gen. Teacher Rosetta Stone Phase I
REVENUES:
5700 Total Local and Intermediate Sources $ 59,503 $ 4,603 $ 10,995 $ 15,422
5800 State Program Revenues - - - -
5900 Federal Program Revenues - - - -
5020 Total Revenues 59,503 4,603 10,995 15,422
EXPENDITURES:
Current:
0011 Instruction 47,823 4,603 10,995 -
0012 Instructional Resources and Media Services - - - -
0013 Curriculum and Instructional Staff Development - - - -
0021 Instructional Leadership - - - -
0023 School Leadership - - - 4,645
0031 Guidance, Counseling and Evaluation Services - - - -
0036 Extracurricular Activities - - - -
0041 General Administration - - - 10,777
0051 Facilities Maintenance and Operations 5,150 - - -
0053 Data Processing Services 6,530 - - -
6030 Total Expenditures 59,503 4,603 10,995 15,422
1200 Net Change in Fund Balance - - - -
0100 Fund Balance-September 1 (Beginning) - - - -
3000 Fund Balance-August 31 (Ending) $ - $
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i
EXHIBIT F-2
492 494 Total
WAF WAF Nonmajor
Recruitment Library Media Governmental
Phase II Resource Funds
$ 26,742 $ 61,856 $ 282,803
- - 6,714
- - 152,351
26,742 61,856 441,868
20,000 37,476 317,941
- 14,501 14,501
- 28,080
- - 732
- - 4,645
- - 2,653
- - 28,841
6,742 - 20,614
- 6,872 12,022
- 3,007 9,537
26,742 61,856 439,566
- - 2,302
2,301
4,603
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FA N
K—. 1 l
PATTILLO, BROWN & HILL, L.L.P.
CERTIFIED PUBLIC ACCOUNTANTS ■ BUSINESS CONSULTANTS
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON
COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL
STATEMENTS PERFORMED IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS
Board of Trustees
Westlake Academy
Members of the Board:
We have audited the accompanying financial statements of the governmental activities, the discretely presented
component unit, each major fund, and the aggregate remaining fund information of Westlake Academy (the "Academy") as
of and for the year ended August 31, 2012, which collectively comprise the Academy's basic financial statements and have
issued our report thereon dated December 19,2012. We conducted our audit in accordance with auditing standards generally
accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States.
Internal Control Over Financial Reporting
Management of Westlake Academy is responsible for establishing and maintaining effective internal control over
financial reporting. In planning and performing our audit,we considered Westlake Academy's internal control over financial
reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial
statements, but not for the purpose of expressing an opinion on the effectiveness of Westlake Academy's internal control
over financial reporting. Accordingly, we do not express an opinion on the effectiveness of Westlake Academy's internal
control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow management or
employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a
timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a
reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and
corrected on a timely basis.
Our consideration of internal control over financial reporting was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that
might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any deficiencies in internal
control over financial reporting that we consider to be material weaknesses, as defined previously.
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115 SOUTH CHURCH STREET■HILLSBORO,TX 76645■(254)582-2583 ■FAX:(254)582-5731 ■www.pbhcpa.com
AFFILIATE OFFICES:BROWNSVILLE,TX(956)544-7778■TEMPLE,TX(254)791-3460
WACO,TX(254)772-4901 ■ALBUQUERQUE,NM(505)266-5904
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Westlake Academy's financial statements are free of
material misstatement, we performed tests of its compliance with certain provisions of laws,regulations, contracts, and grant
agreements, noncompliance with which could have a direct and material effect on the determination of financial statement
amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and
accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other
matters that are required to be reported under Government Auditing Standards.
This report is intended solely for the information and use of the audit committee, management, Board of Trustees,
others within the entity, and federal awarding agencies and pass-through entities and is not intended to be used and should
not be used by anyone other than these specified parties.
December 19,2012
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