HomeMy WebLinkAboutWA RES 24-40 Approving the FY 2023-2024 Annual Audit Report for Westlake AcademyTHIS PAGE INTENTIONNALY LEFT BLANK
Westlake Academy
(A Component Unit of the Town of Westlake)
Annual Financial Report
For the Ten-Month Period Ended June 30, 2024
Table of Contents
i
INTRODUCTORY SECTION Pa ge Exhibit
Certificate of Board ii
FINANCIAL SECTION
Independent Auditor's Report 1
Managem ent's Disc ussion and Analysis 5
Basic Financial Sta temen ts:
Governm ent-wide Finan cial Stat em ents
Stat em en t of Net Position 18 A-1
Stat em en t of Activities 20 B-1
Fund Finan cial Stat em ents:
Balan ce S heet 21 C-1
Reconciliation of the Governmental Fun ds Balan ce S heet to the S tatem ent of Net Position 22 C-2
Stat em en t of Reven ues, Expen ditures, and Changes in Fund Balan ce 23 C-3
24 C-4
Fiduc iar y Fu nds:
Stat em en t of Fiduc iar y Net Position 25 D-1
Stat em en t of Changes in Fiduc iar y Net Position 26 D-2
Notes to the Fin an cial Statem ents 27
Schedule of Related Party Transac tions 57 B.20
Requ ir ed Su pplemen tary Information:
Budgetary Com parison S chedule - General Fund 61 E-1
Notes to the Budgetary Comparison S chedule 63
Schedule of Ac adem y's Proportionate S hare of
Net Pension Liab ility - Teac her Retirem ent S ystem 64 E-2
Schedule of Pension Contributions - Teacher Retirem ent S yst em 65 E-3
Schedule of Ac adem y's Proportionate S hare of
Net OPEB Liability - Teacher Retirem en t S ystem TRS Care Plan 66 E-4
Schedule of OPEB Contributions - Teacher Retirem ent S yst em TRS Care Plan 67 E-5
Combin in g Sta temen ts:
Combining Balan ce S heet - Non major Governmental Fun ds 70 H-3
71 H-4
Requ ir ed TEA Sch edu les
Use of Funds Report 72 J-4
In ternal Control Repor t
73
Reconciliation of the S tatem ent of Revenues, Expenditures, and Changes in Fund
Balan ces of Gover nm en tal Funds to the S tatem ent of Ac tivit ies
Combining S tatem ent of Reven ues, Expenditures an d Changes in Fund Balan ces -
Non major Governm en tal Fu nds
Independent Auditor's Report on Internal Control over Fin an cial Reporting
an d on Compliance and Other M at ters Based on an Audit of Financial
Stat em ents Perform ed in Ac cordance with Governm ent Auditing S tandards
Board Secretary Signature of Board President
If the Board of Trustees disapproved of the auditor's report, the reason(s) for disapproving it is(are):
(Attach list as necessary)
We the undersigned, certify that the attached annual financial reports of the above named school were
reviewed and (check one)___approved___disapproved for the year ended August 31,2023 at a
meeting of the Board of Trustees of such school on the 11th day of November, 2024.
Certificate of Board
WESTLAKE ACADEMY
Name of School
TARRANT
County
220-810
County District Number
ii
FINANCIAL SECTION
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14950 Heathrow Forest Pkwy | Suite 530 | Houston, TX 77032 |Tel: 281.907.8788 | Fax: 888.875.0587 | www.BrooksWatsonCPA.com
INDEPENDENT AUDITOR’S REPORT
To the Board of Trustees
Westlake Academy:
Report on the Audit of the Financial Statements
Opinions
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 the Westlake Academy (the
“Academy”)as of and for the year ended June 30, 2024, and the related notes to the financial statements, which
collectively comprise the Academy’s basic financial statements as listed in the table of contents.
In our opinion, the accompanying financial statements 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 the Westlake Academy, as of June 30, 2024, and the respective
changes in financial position for the ten months then ended in accordance with accounting principles generally
accepted in the United States of America.
Basis for Opinions
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 from material misstatement. We are required
to be independent of Westlake Academy and to meet our other ethical responsibilities, in accordance with the
relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements
The Academy’s management is responsible for the preparation and fair presentation of the financial statements in
accordance with accounting principles generally accepted in the United States of America, and for the design,
implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events,
considered in the aggregate, that raise substantial doubt about the Academy’s ability to continue as a going concern
for one year after the date that the financial statements are issued.
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Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.
Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee
that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The
risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate,
they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS, we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, and design and perform audit procedures responsive to those risks. Such procedures include
examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Academy’s internal control. Accordingly, no such opinion is expressed.
Evaluate the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluate the overall presentation of the
financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that
raise substantial doubt about the Academy’s ability to continue as a going concern for a reasonable
period of time.
We are required to communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that
we identified during the audit.
Emphasis of Matter
As discussed in Note 5.H to the financial statements, due to prior year accounting corrections, the Academy
restated beginning net position/fund balance for governmental activities, the general fund, and one nonmajor
governmental fund. Our opinion is not modified with respect to these matters.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and analysis, budgetary comparison information, schedules of the Academy’s proportionate share of
the net pension liability and the net OPEB liability, and schedules of Academy pension and OPEB contributions as
listed in the table of contents, be presented to supplement the basic financial statements. Such information,
although not a part of the basic financial statements, is required by the GASB who considers it to be an essential
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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.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise
the Academy's basic financial statements. The nonmajor governmental funds combining statements are presented
for the purposes of additional analysis and are not a required part of the basic financial statements. The nonmajor
governmental funds combining statements are the responsibility of management and were derived from and relate
directly to the underlying accounting and other records used to prepare the basic financial statements.
Such information has been subjected to the auditing procedures applied in the audit of the basic financial
statements and certain additional procedures, including comparing and reconciling such information directly to
the underlying accounting and other records used to prepare the basic financial statements or to the basic financial
statements themselves, and other additional procedures in accordance with auditing standards generally accepted
in the United States of America. In our opinion, the nonmajor governmental funds combining statements are fairly
stated in all material respects in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated November 11, 2024, 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 internal control over financial reporting or on
compliance. That report is an integral part of an audit performed in accordance with Government Auditing
Standards in considering the Academy's internal control over financial reporting and compliance.
BrooksWatson & Co.
Certified Public Accountants
Houston, Texas
November 11, 2024
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Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS
June 30, 2024
5
This section of the Westlake Academy (the “Academy”)annual financial report presents our
discussion and analysis of the Academy's financial performance during the fiscal year ended August
31, 2024. Please read it in conjunction with the Academy’s financial statements. In reviewing this
report, readers should be mindful that it is often necessary for management to make and use
estimates in the preparation of financial statements. Examples of the use of such estimates may be
found in amounts reported for depreciation, receivable allowances, and net pension/OPEB liability.
Financial Highlights
The liabilities and deferred inflows of the Academy exceeded its assets and deferred outflows (net
position) at June 30, 2024 by $3,142,655.
The Academy's total net position increased by $342,488.
The Academy reported $12,583,411 in expenses related to governmental activities, of which
$5,326,372 of these expenses were offset by program-specific charges for services or grants and
contributions.
At the end of the fiscal year, the general fund reported a fund balance of $2,007,991, an increase of
$716,296.
Overview of the Financial Statements
The discussion and analysis provided here are intended to serve as an introduction to the Academy’s
basic financial statements. The Academy’s basic financial statements consist of three components:1)
government-wide financial statements, 2) fund financial statements, and 3) the notes to financial
statements. This report also includes supplementary information intended to furnish additional detail to
support the basic financial statements themselves.
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. Its primary objective is to show whether the
Academy is better or worse off as a result of the year's activities.The statement of net position includes all
of the Academy's assets and liabilities, deferred inflows and outflows of resources. The facilities used in
the Academy’s operations are included in the Town of Westlake’s financial statements.
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 Academy's revenue is divided into those provided by outside parties who share the costs of some
programs, such as payments received from extracurricular activities and grants provided by the U.S.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
6
Department of Education to assist children with disabilities (program revenue), and general revenue
provided by donations from the public or by Texas Education Agency (TEA) in equalization funding
processes (general revenue). All the Academy's assets are reported whether they serve the current year or
future years. Liabilities are considered regardless of whether they must be paid in the current or future
years.
The two government-wide statements report the Academy's net position and how it has changed. Net
position-the difference between the Academy's assets, deferred outflows of resources, and liabilities and
deferred inflows of resources-is one way to measure the Academy’s financial health or position.
Over time, increases or decreases in the Academy's net position are an indicator of whether its
financial health is improving or deteriorating, respectively.
To assess the overall health of the Academy, one should consider additional non-financial factors
such as changes in the Academy’s average daily attendance and the condition of the Academy’s
facilities.
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, curriculum and staff development,
extracurricular activities, maintenance, health services and general administration. State funds, donations
and grants finance most of these activities.
The government-wide financial statements can be found on pages 18-20 of this report.
FUND FINANCIAL STATEMENTS
The fund financial statements begin on page 21 and 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.All of
the funds of the Academy can be divided into two categories: governmental funds and fiduciary funds.
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.
Governmental Funds
Governmental funds are used to account for essentially the same functions reported as governmental
activities in the government-wide financial statements. However, unlike the government-wide financial
statements, governmental fund financial statements focus on near-term inflows and outflows of spendable
resources, as well as on balances of spendable resources available at the end of the fiscal year. Such
information may be useful in assessing a government’s near-term financing requirements.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
7
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government-wide financial statements. By doing
so, readers may better understand the long-term impact of the government’s near-term financing
decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues,
expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between
governmental funds and governmental activities.
The Academy maintains eight individual governmental funds. Information is presented separately in the
governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and
changes in fund balances for the general fund and the ESSER fund, which are considered to be major
funds. Data from the other governmental funds are combined into a single, aggregated presentation.
Individual fund data for each of these nonmajor governmental funds is provided in a separate section of
the report.
The Board of Trustees adopts a budget for the general fund.A budgetary comparison statement has been
provided for the general fund to demonstrate compliance with their respective budget.
The basic governmental fund financial statements can be found on pages 21-24 of this report.
Fiduciary Funds
Fiduciary funds are used to account for resources held for the benefit of parties outside of the
government. Fiduciary funds are not reported in the government-wide financial statements because the
resources of those funds are not available to support the Academy’s own programs. The accounting used
for fiduciary funds is much like that used for proprietary funds.
The Academy maintains one fiduciary fund, the Student Activity Fund. The custodial fund accounts for
resources held for others in a custodial capacity.
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 the ten-month fiscal
period ending June 30, 2024, the Foundation contributed $1,129,384 to the Academy to enhance
educational opportunities. These contributions are recorded as operating grants and contributions in the
Statement of Activities.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
8
Notes to Financial Statements
The notes provide additional information that is necessary to acquire a full understanding of the data
provided in the government-wide and fund financial statements.
The notes to the financial statements can be found on pages 27-56 of this report.
Other Information
In addition to the basic financial statements, MD&A, and accompanying notes, this report also presents
certain Required Supplementary Information (RSI). The required RSI includes a budgetary comparison
schedule for the general fund, schedule of changes in the net pension/OPEB liability and related ratios
and schedule of employer contributions for the Teacher Retirement System of Texas. RSI can be found
after the basic financial statements.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted previously, net position may serve over time as a useful indicator of the Academy’s financial
position. For the Westlake Academy liabilities exceeded assets by $3,142,655 as of June 30, 2024,in the
primary government.
A portion of the Academy’s net position,a deficit of $8,899 reflects its investments in capital assets (e.g.
right to use assets),less any debt used to acquire those assets that are still outstanding. The Academy uses
these capital assets to provide services to its teachers and students; consequently,these assets are not
available for future spending. Although the Academy’s investment in its capital assets is reported net of
related debt, it should be noted that the resources needed to repay this debt must be provided from other
sources, since the assets themselves cannot be used to liquidate these liabilities.
An additional portion of the Westlake Academy’s net position of $2,834 represents resources that are
subject to external restrictions on how they may be used.
At the end of the current fiscal year, the Westlake Academy reported negative balances for unrestricted
net position for the primary government. The same situation held true for the prior fiscal year.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
9
Statement of Net Position:
The following table reflects the condensed Statement of Net Position:
Current and
ot her assets $2,534,650 $1,824,072 $710,578 39%
Capital a ssets, n et 193,905 355,493 (1 61,588) -45%
Tota l As se ts 2,728,555 2,179,565 548,990 25%
3,754,840 2,984,500 770,340 26%
Current liab ilit ies 600,134 645,970 (4 5,836) -7%
Lon g-term lia bilit ies 5,874,688 5,213,744 660,944 13%
To ta l L ia bilitie s 6,474,822 5,859,714 615,108 10%
3,151,228 2,789,494 361,734 13%
Net Pos it ion:
Net i nves tment i n
n et of r el ated deb tcapital a ssets (8 ,899)(8 ,7 67) (1 32) 100%
Restrict ed 2,834 2,630 204 8%
Un restrict ed (3 ,1 36,590)(3 ,4 79,006) 342,416 -10%
To ta l N et P ositio n $(3 ,1 42,655)$(3 ,4 85,143)$342,488 $-10%
Gove rnmental Activitie s
$ Chang e % Ch ange8/31/20236/30/2024
Defe rre d Inflo ws of
Re sources
Deferred Outflo ws of
Re sources
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
10
Statement of Activities:
The following table provides a summary of the Academy’s changes in net position:
Re ve nue s
Pr ogr am revenues:
Ch arges for s er vices $76,985 $116,869 $(3 9,884) $-34%
Oper ating gr ants
and c on tribution s 3,953,345 3,302,992 650,353 20%
Ca pital gr ants
and c on tribution s 1,296,042 804,638 491,404 61%
General r ev en ues :
State a id & for mula gr ants 7,558,907 7,602,771 (4 3,864) -1%
In vestment ea rnings (l osses)40,620 34,506 6,114 18%
To ta l Re ve nues 12,925,899 11,861,776 1,064,123 9%
Expe nse s
In struction 6,479,234 6,075,612 403,622 7%
In struction r es our ces and
media ser vices 182,534 201,983 (1 9,449) -10%
Cur riculum and staff
dev el op ment 44,715 82,243 (3 7,528) -46%
In structional leader ship 262,845 251,874 10,971 4%
School leader ship 1,198,453 1,266,403 (6 7,950) -5%
Guida nce, c ounseling
and ev aluations 684,591 593,571 91,020 15%
He alt h services 102,643 153,614 (5 0,971) -33%
Food s er vice 83,884 51,499 32,385 63%
Ex tracurricular a ct ivities 870,745 867,508 3,237 0%
Gener al administration 641,714 655,856 (1 4,142) -2%
Fa cilities maint. a nd oper .1,280,681 1,340,628 (5 9,947) -4%
Secur it y and monitoring 126,030 49,908 76,122 153%
Da ta proces sing s er vices 432,961 389,645 43,316 11%
Community services 171,959 166,746 5,213 3%
De bt service - interest 20,422 23,272 (2 ,8 50) -12%
Tota l Exp enses 12,583,411 12,170,362 413,049 3%
Change in Net Po sitio n 342,488 (3 08,586)651,074
Beginning Net Pos ition (3 ,4 85,143)(3 ,1 76,557) (3 08,586) 10%
Ending Net Po sitio n $(3 ,1 42,655)$(3 ,4 85,143)$342,488 $-10%
Go ve rnmental Ac tivitie s
9/1/23 - 6 /30/24 8/31/2023 $ Change % Change
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
11
Graphic presentations of selected data from the summary tables are displayed below to assist in the
analysis of the Academy’s activities.
Governmental Activities –Revenues
For the year ended June 30, 2024, revenues from governmental activities totaled $12,925,899. Overall
revenue increased $1,064,123 or 9%from the prior year. The increase was primarily due to nonrecurring
contributions received from the Town of Westlake. These contributions were given to the Academy as a
subsidy to balance the budget.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
12
This graph shows the governmental function expenses of the Academy:
Governmental Activities –Expenses
For the ten months ended June 30, 2024, expenses for governmental activities totaled $12,583,411.This
represents an increase of $413,049 or 3%from the prior fiscal year ending August 31, 2023.This overall
increase is primarily due to greater personnel costs, resulting from the Academy hiring new employees in
the current year.
The Academy elected to change their fiscal year end from an August 31st year end to a June 30th year
end, effective for the fiscal year ending June 30, 2024.The comparative balances displayed in the
condensed financial statements above are for the year ended August 31, 2023. The current year audited
financial statements span ten months –September 1, 2023, through June 30, 2024.
Certain expense categories are noted to have decreased when compared to the prior fiscal year ending
August 31, 2023. This is primarily the result of ten months of expenses being incurred in the current fiscal
year (September 1, 2023, through June 30, 2024) compared to twelve months of expenses being incurred in
the prior fiscal year.
FINANCIAL ANALYSIS OF THE ACADEMY’S FUNDS
As noted earlier, fund accounting is used to demonstrate and ensure compliance with finance-related
legal requirements.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
13
Governmental Funds -The focus of the Academy’s governmental funds is to provide information of near-
term inflows, outflows and balances of spendable resources.Such information is useful in assessing the
Academy’s financing requirements.In particular, unassigned fund balance may serve as a useful measure
of the Academy’s net resources available for spending at the end of the year.
At June 30, 2024, the Academy’s governmental funds reported combined fund balances of $2,094,874, an
increase of $986,445 in comparison with the prior year. Approximately 90%of this amount,$1,880,695,
constitutes unassigned fund balance, which is available for spending at the government’s discretion. The
remainder of the fund balance is either nonspendable, restricted or committed to indicate that it is 1) not in
spendable form $39,590 or 2) committed for particular purposes $171,755 or 3) restricted for donor
stipulations $2,834.
As of the end of the year the general fund reflected a total fund balance of $2,007,991.General fund
balance increased by $716,296 during the current year. The increase is primarily due to local sources and
state program revenues exceeding current year expenditures.
The ESSER fund had an ending fund deficit of $27,609 at June 30, 2024. The fund balance increased by
$264,225. The increase is primarily due to federal program revenues not being offset by any expenditures
in the current year.
GENERAL FUND BUDGETARY HIGHLIGHTS
Total budgeted revenues of $10,978,420 were more than actual revenues of $10,746,156, resulting in a
negative revenue variance of $232,264.The negative variance was primarily the result of less than
expected local revenue sources and state program revenues.Total budgeted expenditures of $11,590,952
were more than actual expenditures of $10,029,860, resulting in a positive expenditure variance of
$1,561,092. The variance in total expenditures was primarily due to positive variances within all
departments, with the exception of, debt service –interest expenses.
CAPITAL ASSETS
As of the end of the year, the Academy’s governmental activities had a carrying value of $193,905 in right
to use assets. This investment in assets includes a lease financing agreement for Apple TV equipment,
Apple Macbooks, iPads, and Pro iOS software licenses. The Academy did not purchase new capital assets
during the year.Current year depreciation amounted to $161,588.
More detailed information about the Academy’s capital assets is presented in note 4.D to the financial
statements.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
14
LONG-TERM DEBT
The Academy's outstanding lease payable balance at the end of the current year was $202,804. During the
year, principal payments totaling $161,456 were made on the outstanding lease obligations.
More detailed information about the Academy’s long-term liabilities is presented in note 4.E to the
financial statements.
CURRENT CONDITIONS AND FUTURE CONSIDERATIONS
Westlake Academy serves as a premier institution of learning for the children of Westlake and
surrounding areas. As one of the only IB continuum schools in Texas, our focus is on providing an
engaging, college-preparatory education in a public charter school setting. Our campus has upgraded the
safety equipment at the school by installing over 80 new cameras with AI detection, new panic buttons
with remote monitoring, and new access monitoring for doors. We lead with a focus on the holistic
nature of education in a safe, welcoming environment.
Westlake Population Growth:Over the past several years, our community has grown through the
addition of new residential subdivisions and the construction of new homes within our existing
neighborhoods. We are also within the heart of the Fort Worth-Dallas Metroplex, which has also
experienced tremendous growth in residential units. This type of growth within our own community
results in potentially greater enrollment of primary boundary students (those who live in the Westlake
community). The regional growth will ultimately affect the extended boundary lottery wait list as more
families seek admittance through the lottery.
Public Education Funding:Funding of public education continues to remain a topic of discussion across
the state and will be discussed in the 2025 Legislative Session. As we receive the majority of our funding
from the State of Texas, we will continue to work with Westlake Academy administrators and our elected
officials to identify key revenue and expenditure drivers for the Academy while assessing historical
financial trends and their impact upon our financial stability.
Change in Fiscal Year End:On June 21, 2023, the Texas Education Agency approved changing the
Academy’s fiscal year from beginning on September 1st and ending on August 31st to beginning on July
1st and ending on June 30th, effective September 1, 2023. In the first year of implementation, the financial
accounting period will span 10 months, with an annual operating budget prepared on a 12-month basis.
The financial data reported through the PEIMS collection system must also be on a 12-month basis,
matching the 12-month budget and maintaining comparability with previous fiscal years. However, the
audited financial statements will reflect only the 10-month activity.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
15
ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES
The Fiscal Year 2024-2025 budget was prepared with conservative revenue projections and expenditures
that are targeted to create an exceptional learning environment designed for student success, supporting
a culture where all Westlake Academy students, faculty and staff are able to continuously develop their
knowledge and skills. Student enrollment projections for budgeting purposes remains at the 2023-2024
level of 875 students.
General Fund revenues are budgeted at $11,510,063, an increase of $763,906, or 14% over the actual
revenues realized in FY23 due to the following increases and additions:
Increase in participation and donations through the Blacksmith Annual Campaign,
Increase in Municipal contributions for Westlake Academy operations,
Increase in State revenue due to student attendance and special population programs.
Total appropriations within the General Fund budget are estimated to reach $11,510,063, which is a
cumulative increase $1,480,203, or 15%, over actual expenditures in FY24. This change is primarily due to
the salary increases and related payroll benefits and service level adjustments of $58,790. Changes in the
Fiscal Year 2024-2025 adopted budget include:
Payroll
Salary increases of 2% of mid-point plus step for positions listed on the step plan (teachers,
librarians, counselors, nurses, diagnosticians), and 2% for those excluded from the step plan.
Adding the following positions, which increased the total full-time equivalents (FTEs) to 119.51:
o (1.0) Special Education Teacher
o (.75) Building Technician (this position will be split-funded between the Town of Westlake
at 25% and Westlake Academy at 75%)
Professional & Contracted Services
These costs are related to services rendered to the Academy by firms, individuals, and other
organizations. A 21% decrease in expenditures compared to prior year actuals was the result of
Principal and Leadership reviews and decreasing costs where applicable without hindering
instructional service delivery. Other notable changes include:
o Increase in Athletic league membership fees and the addition of HUDL technology for all
sports.
o An addition of a one-time cost for the IB Curriculum Evaluation for Primary Years
Programme, Middle Years Programme, and the Diploma Programme. This occurs every
five years.
o Changes in student support contracts for autism intervention, audiological, and physical
therapy due to the changing needs in Special Education and 504 assessments.
Westlake Academy
MANAGEMENT’S DISCUSSION AND ANALYSIS, Continued
June 30, 2024
16
Materials & Supplies
A 34% increase in expenditures over prior year actuals is associated with consumables used in the
classroom and in the general operations of the campus, including:
o Increases in program-specific instructional supplies,
o Increases in technology-related supplies, including the replacement of SMART TVs in
classrooms
Miscellaneous Operating Costs
A 22% increase in expenditures over the prior year actuals is associated with insurance,
professional development travel, membership fees and dues, and other miscellaneous costs,
including:
o Travel and related professional development training for teachers and administrators
o Professional and organizational dues,
o Increase in liability and health insurance
Debt Service
Costs related to the lease for iPads could possibly increase by 31% over the prior year actuals due
to the following:
o Increase due to property taxes on leased property,
o Additional estimated costs due to the close out of the 3-year lease in Spring 2025,
o I-Pad maintenance and repair costs are self-funded through a $99 annual technology use
fee paid by each student at the beginning of the school year.
If the FY 2024-2025 budget estimates are realized, the Academy’s General Fund’s budgetary fund balance
may see slight changes. The audited ending fund balance in General Fund as of June 30, 2024 will
increase by $720,250 for a total ending balance of $1,993,503, equating to 45 operating days. This increase
is due to changing the fiscal year end from August 31st to June 30th. The 2023-24 fiscal year was the
transition year auditing 10-months of operational activity.
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 Director of Finance at (817) 490-5721 or the Academic Finance Manager
at (817) 490-5737, or by writing to 1500 Solana Blvd, Building 7, Suite 7200, Westlake,Texas 76262.
BASIC FINANCIAL STATEMENTS
17
Current assets:
1110 Cash and cash equivalents $1,090,272 $627,992
1120 Investments - 2,550,253
1240 Due from other governments 1,339,781 -
1290 Other receivables, net 65,007 -
1410 Prepaids 39,590 -
2,534,650 3,178,245
Noncurrent assets:
Capital assets:
Net depreciable capital assets 193,905 -
193,905 -
1000 2,728,555 3,178,245
Deferred Outflows of Resources
1705 Pension outflows 3,075,092 -
1705 OPEB outflows 679,748 -
1700 3,754,840 -
Total Current Assets
Total Noncurrent Assets
Total Deferred Outflows of Resources
Assets
Total Assets
Westlake Academy
STATEMENT OF NET POSITION (Page 1 of 2)
June 30, 2024
Component
Unit
Governmental
Primary
Government
Data Control
Codes
1 4
Exhibit A-1
Activities
18
Liabilities
Current liabilities:
2110 Accounts payable $98,731 $33,899
2160 Accrued wages payable 281,963 -
2200 Accrued expenditures 16,636 -
2501 Long-term debt due within one year 202,804 -
600,134 33,899
Noncurrent liabilities:
2540 Net pension liability 4,390,064 -
2545 OPEB liability 1,484,624 -
5,874,688 -
2000 6,474,822 33,899
Deferred Inflows of Resources
2605 Pension inflows 988,289 -
2605 OPEB inflows 2,162,939 -
2600 3,151,228 -
3200 Net investment in capital assets (8,899) -
Restricted for:
3890 Donor stipulations 2,834 317,809
3900 Unrestricted (3,136,590) 2,826,537
3000 $(3,142,655) $3,144,346
See Notes to Financial Statements.
1 4
Primary
Government
Data Control
Codes
Governmental Component
Activities Unit
Westlake Academy
STATEMENT OF NET POSITION (Page 2 of 2)
June 30, 2024
Total Current Liabilities
Total Net Position
Total Deferred Inflows of Resources
Net Position
Total Liabilities
Total Noncurrent Liabilities
19
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Exhibit C-1
1100 Cash and cash equivalents $865,254 $50,633 $174,385 $1,090,272
1240 Due from other governments 1,339,781 - - 1,339,781
1260 Due from other funds 168,547 - - 168,547
1290 Other receivables, net 23,700 - 41,307 65,007
1410 Prepaids 39,590 - - 39,590
$2,436,872 $50,633 $215,692 $2,703,197
Liabilities
2110 Accounts payable $98,731 $- $- $98,731
2160 Accrued wages payable 281,963 - - 281,963
2170 Due to other funds - 78,242 90,305 168,547
2200 Accrued expenditures 16,636 - - 16,636
397,330 78,242 90,305 565,877
Deferred Inflows of Resources
31,551 - 10,895 42,446
Total Deferred Inflows of Resources 31,551 - 10,895 42,446
Nonspendable:
3430 Prepaid items 39,590 - - 39,590
Restricted for:
3490 Donor stipulations - - 2,834 2,834
Committed for:
3545 Campus activities - - 171,755 171,755
3600 Unassigned 1,968,401 (27,609) (60,097) 1,880,695
3000 2,007,991 (27,609)114,492 2,094,874
4000 $2,436,872 $50,633 $215,692 $2,703,197
See Notes to Financial Statements.
Data
Control
Codes
Total Liabilities. Deferred
Inflows, and Fund Balances
Total Assets
Total Fund Balances
Assets
General
Fund Balances
Total Liabilities
Unavailable revenue
- due from state
Fund
ESSER
Westlake Academy
BALANCE SHEET
GOVERNMENTAL FUNDS
June 30, 2024
9810283
Total
Governmental
Funds
Nonmajor
Governmental
Funds
21
Exhibit C-2
Fund Balances - Total Governmental Funds $2,094,874
Adjustments for the Statement of Net Position:
Capital assets used in governmental activities are not current financial
resources and, therefore, not reported in the governmental funds.
Capital assets - net depreciable 193,905
Other long-term assets are not available to pay for current-period
expenditures and, therefore, are deferred in the governmental funds 42,446
Deferred inflows of resources, represents an acquisition of net position that applies
to a future period(s) and so will not be recognized as an inflow of resources
(revenues) until that time
Pension inflows (988,289)
OPEB inflows (2,162,939)
Deferred outflows of resources, represent a consumption of net position that applies
to a future period(s) and is not recognized as an outflow of resources (expense/
expenditures) until then
Pension outflows 3,075,092
OPEB outflows 679,748
Some liabilities, including bonds payable and deferred charges, are not reported as
liabilities in the governmental funds.
Net pension liability (4,390,064)
OPEB liability (1,484,624)
Leases payable, current (202,804)
Net Position of Governmental Activities $(3,142,655)
Westlake Academy
RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET POSITION
GOVERNMENTAL FUNDS
June 30, 2024
22
Exhibit C-3
Revenues
5700 Local and intermediate sources $2,794,135 $- $566,439 $3,360,574
5800 State program revenues 7,952,021 - 141,174 8,093,195
5900 Federal program revenues - 264,225 133,642 397,867
5020 10,746,156 264,225 841,255 11,851,636
Expenditures
Current:
0011 Instruction 5,015,099 - 246,807 5,261,906
0012 Instructional resources and media 123,472 - - 123,472
0013 Curriculum and staff development 40,545 - 4,170 44,715
0021 Instructional leadership 252,002 - - 252,002
0023 School leadership 1,085,587 - 5,139 1,090,726
0031 Guidance, counseling, evaluations 640,771 - 3,783 644,554
0033 Health services 79,050 - - 79,050
0036 Extracurricular activities 355,575 - 442,370 797,945
0041 General administration 584,578 - 23,493 608,071
0051 Facilities maintenance and operations 1,090,851 - - 1,090,851
0052 Security and monitoring services 16,461 - 109,569 126,030
0053 Data processing services 404,735 - - 404,735
0061 Community services 159,256 - - 159,256
Debt Service:
0071 Principal 161,456 - - 161,456
0072 Interest and fiscal charges 20,422 - - 20,422
10,029,860 - 835,331 10,865,191
1100
716,296 264,225 5,924 986,445
1200 716,296 264,225 5,924 986,445
0100 Beginning fund balances 1,291,695 (291,834) 108,568 1,108,429
3000 $2,007,991 $(27,609) $114,492 $2,094,874
See Notes to Financial Statements.
Total Revenues
Fund
Nonmajor Total
Governmental
Funds
Governmental
Funds
98
(Deficit) Ending Fund Balances
Total Expenditures
Over (Under) Expenditures
Excess of Revenues
Net Change in Fund Balances
ESSER
Data
Control
Codes
Westlake Academy
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE
GOVERNMENTAL FUNDS
For the Ten Months Ended June 30, 2024
10 283
General
23
Amounts reported for governmental activities in the statement of activities are
different because:
Net changes in fund balances - total governmental funds $986,445
Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their estimated
useful lives and reported as depreciation expense.
Depreciation expense (161,588)
Revenues in the statement of activities that do not provide current financial
resources are not reported as revenues in the funds.(221,779)
Some expenses reported in the statement of activities do not require the use of current
financial resources and, therefore, are not reported as expenditures in governmental funds.
Pension expense (708,931)
OPEB expense 286,885
The issuance of long-term debt (e.g., bonds, leases, certificates of obligation)
Principal payments on leases 161,456
$342,488
See Notes to Financial Statements.
Change in Net Position of Governmental Activities
For the Ten Months Ended June 30, 2024
Westlake Academy
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE
STATEMENT OF ACTIVITIES
Exhibit C-4
provides current financial resources to governmental funds,while the repayment of
the principal of long-term debt consumes the current financial resources of
governmental funds.Neither transaction,however,has any effect on net position.
Also,governmental funds report the effect of premiums,discounts,and similar
items when they are first issued;whereas,these amounts are deferred and amortized
in the statement of activities.This amount is the net effect of these differences in the
treatment of long-term debt and related items.
24
Cash and cash equivalents $29,286
Prepaids 315
Total Assets 29,601
Held for student activities 29,601
Total Net Position $29,601
Westlake Academy
STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUNDS
June 30, 2024
Custodial
Fund
Exhibit D-1
Net Position
Student
Activity Fund
Assets
The notes to the financial statements are an integral part of this statement.
25
Local and intermediate sources $46,182
Total Additions 46,182
Deductions
Extracurricular activities 48,936
Total Deductions 48,936
Change in Fiduciary Net Position (2,754)
Beginning net position 32,355
Ending Net Position $29,601
Westlake Academy
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FIDUCIARY FUNDS
For the Ten Months Ended June 30, 2024
Student
Custodial
Fund
Exhibit D-2
The notes to the financial statements are an integral part of this statement.
Activity Fund
Additions
26
Westlake Academy
NOTES TO FINANCIAL STATEMENTS
June 30, 2024
27
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 Town Council consists of six members and serves as the governing
body for the Academy. 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 Town Council has the authority to set policy direction, appoint the Superintendent, and
evaluate the success of the academic service delivery efforts. 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", as modified by GASB
Statements No. 39 and 61.
The Academy elected to change their fiscal year end from an August 31st year end to a June 30th
year end, effective for the fiscal year ending June 30, 2024.The beginning balances displayed
within are as of August 31, 2023. The current peeriod audited financial statements span ten
months –August 31, 2023 through June 30, 2024.
The more significant accounting policies of the Academy are described below.
A.Description of Government-Wide Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement of
activities) report information on all of the nonfiduciary activities of the primary government and
its component units. All fiduciary activities are reported only in the fund financial statements.
Governmental activities, which normally are supported by taxes, intergovernmental revenues, and
other nonexchange transactions, are reported separately from business-type activities, which rely to
a significant extent on fees and charges to external customers for support. Likewise, the primary
government is reported separately from certain legally separate component units for which the
primary government is financially accountable.
B. Financial Reporting Entity
The accompanying financial statements present the government and its component units, entities
for which the government is considered financially accountable.Blended component units,
although legally separate entities, are, in substance, part of the government’s operations.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
28
Discretely presented component units are reported in separate columns in the government-wide
financial statements to emphasize that they are legally separate from the government.
As required by accounting principles generally accepted in the United States of America, these
financial statements include the primary government and organizations for which the primary
government is financially accountable and other organizations for which the nature and
significance of their relationship with the primary government are such that exclusion would
cause the reporting entity's financial statements to be misleading or incomplete.
The definition of the reporting entity is based primarily on the notion of financial accountability.
A primary government is financially accountable for the organizations that make up its legal
entity. It is also financially accountable for legally separate organizations if its officials appoint a
voting majority of an organization's governing body and either it is able to impose its will on that
organization or there is a potential for the organization to provide specific financial benefits to, or
to impose specific financial burdens on, the primary government. A primary government may
also be financially accountable for governmental organizations that are fiscally dependent on it.
A primary government has the ability to impose its will on an organization if it can significantly
influence the programs, projects, or activities of, or the level of services performed or provided
by, the organization. A financial benefit or burden relationship exists if the primary government
(a) is entitled to the organization's resources; (b) is legally obligated or has otherwise assumed the
obligation to finance the deficits of, or provide financial support to, the organization; or (c) is
obligated in some manner for the debt of the organization.
Some organizations are included as component units because of their fiscal dependency on the
primary government. An organization is fiscally dependent on the primary government if it is
unable to adopt its budget, collect grants, set rates or charges, or issue bonded debt without
approval by the primary government.
Discretely Presented Component Units
Westlake Academy Foundation
The Westlake Academy Foundation (the “Foundation”) is a 501(c)(3) nonprofit organization
which was established exclusively for the purpose 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. Separate audited financial statements
of the Foundation are available from the Academy/Town Finance Director's office, 1500 Solana
Blvd, Building 7, Suite 7200, Westlake, Texas 76262.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
29
C. Basis of Presentation -Government-Wide and Fund Financial Statements
The Statement of Net Position 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.
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 charges for athletic registration fees. 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 and 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.
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.
D. 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,
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
30
current liabilities, deferred inflows of resources, 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 inflows
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.
The fiduciary funds utilize the accrual basis of accounting for purposes of asset and liability
recognition.
With this basis of accounting, all assets and all liabilities associated with the operation of these
funds are included on the Statement of Fiduciary Net Position.
Governmental Funds
Governmental funds are those funds through which most governmental functions are typically
financed. The government reports the following major governmental funds:
General Fund
The General Fund is the main operating fund of the Academy. This fund is used to
account for all financial resources not accounted for in other funds.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
31
ESSER Fund
The ESSER Fund accounts for federal stimulus ESSER III-Supplemental funds granted to
the LEAs through the CRSSA Act to support the LEA’s ability to operate, instruct its
students, address learning loss, prepare schools for reopening, test, repair, and upgrade
projects to improve air quality in school buildings during the coronavirus pandemic.
Additionally, the Academy reports for the following nonmajor governmental funds:
Nonmajor Governmental Funds
These nonmajor Special Revenue Funds account for resources restricted to, or committed
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.
Fiduciary Funds
Custodial 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 Custodial Fund is a Student Activity Fund.
These activities are excluded from the school’s government-wide financial statements
because they cannot use these assets to finance their operations.
D. 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 is provided for employees in accordance with 19 TAC
§153.1021(d)(8). Each district's local board is required to establish a personal leave plan. It is
the Academy's policy to permit employees to accumulate earned but unused state and local
personal leave. 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
Academy.
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
ensure accuracy in building a statewide database for policy development and funding plan.
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
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
32
an expenditure is incurred for which committed, assigned, or unassigned fund balances are
available, the Academy considers amounts to have been spent first out of committed funds,
then assigned funds, and finally, unassigned funds.
4.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 Academy 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.
•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 Academy'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 Academy's
intent to be used for a specific purpose but are neither restricted nor committed. This
intent can be expressed by the Finance Director and Superintendent.
•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.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
33
E. Assets, Liabilities, Deferred Outflows/Inflows, and Fund Equity or Net Position
1.Cash 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 June 30, 2024, the carrying amount of the Academy's deposits (cash, certificates of deposit, and
interest-bearing savings accounts included in temporary investments), including $29,286
recorded in the Custodial fund, was $807,054 and the bank balance was $1,136,772. The carrying
amount of the Foundation’s deposits was $627,992 as of June 30, 2024 and the bank balance was
$607,097. The Academy cash deposits at June 30, 2024 and during the year then ended was
entirely covered by FDIC insurance or the pledged collateral held by the Academy’s agent bank
in the Town of Westlake’s name.
The following is disclosed regarding the combined balances on the date of highest deposit:
a.Depository: First Financial Bank
b.The market value of securities pledged to the Town (inclusive of the Academy) as of the
date of the highest combined balance on deposit on $44,865,782.
c.The highest combined balances of cash, savings, and time deposit accounts amounted to
$41,873,766 ($1,135,423 of which belonged to the Academy) on June 27,2024.
d.Total amount of FDIC coverage at the time of the highest combined balance was $250,000.
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
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
34
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.
2.Fair Value
The Academy has applied Governmental Accounting Standards Board (GASB) Statement No. 72,
Fair Value Measurement and Application. GASB Statement No. 72 provides guidance for
determining a fair value measurement for reporting purposes and applying fair value to certain
investments and disclosures related to all fair value measurements.
3.Receivables and Interfund Transactions
Transactions between funds that are representative of lending/borrowing arrangements
outstanding at the end of the year are referred to as either “interfund receivables/payables” (i.e.,
the current portion of interfund loans) or “advances to/from other funds” (i.e., the non-current
portion of interfund loans). All other outstanding balances between funds are reported as “due
to/from other funds” in the fund financial statements. If the transactions are between the primary
government and its component unit, these receivables and payables are classified as “due to/from
component unit/primary government.”Any residual balances outstanding between the
governmental activities and business-type activities are reported in the government-wide
financial statements as “internal balances.”
4.Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods (prepaid
expenditures) are recognized as expenditures when utilized.
5.Capital Assets
As the Academy constructs or acquires capital assets each period, including infrastructure assets,
they are capitalized and reported at historical cost (except for intangible right-to-use lease assets,
the measurement of which is discussed in note E.7. below). The reported value excludes normal
maintenance and repairs, which are amounts spent in relation to capital assets that do not
increase the asset's capacity or efficiency or increase its estimated useful life. Donated capital
assets are recorded at acquisition value at the date of donation. Acquisition value is the price that
would be paid to acquire an asset with equivalent service potential on the date of the donation.
Intangible assets follow the same capitalization policies as tangible capital assets and are reported
with tangible assets in the appropriate capital asset class.Capital assets are generally procured by
the Town of Westlake and reported in the Town’s financial statements.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
35
6. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position will sometimes report a separate section
for deferred outflows of resources. This separate financial statement element, deferred outflows of
resources, represents a consumption of net position that applies to a future period(s) and so will
not be recognized as an outflow of resources (expense/ expenditure) until then.
In addition to liabilities, the statement of financial position will sometimes report a separate
section for deferred inflows of resources. This separate financial statement element, deferred inflows
of resources, represents an acquisition of net position that applies to a future period(s) and so will
not be recognized as an inflow of resources (revenue) until that time. The government has only
one type of item, which arises only under a modified accrual basis of accounting that qualifies for
reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the
governmental funds balance sheet. The governmental funds may report unavailable revenues
from grant revenues. These amounts are deferred and recognized as an inflow of resources in the
period that the amounts become available. Deferred inflows of resources can also occur at the
government wide level due to differences between investment gains and losses realized on
pension investments compared to assumption used within the pension actuarial valuation model.
7. Leases
The Academy is a lessee for a noncancellable lease of office equipment. The Academy recognizes
a lease liability and an intangible right-to-use lease asset (lease asset) in the government-wide
financial statements. The Academy recognizes lease liabilities with an individual value of $10,000
or more.
At the commencement of a lease, the Academy initially measures the lease liability at the present
value of payments expected to be made during the lease term. Subsequently, the lease liability is
reduced by the principal portion of lease payments made. The lease asset is initially measured as
the initial amount of the lease liability, adjusted for lease payments made at or before the lease
commencement date, plus certain initial direct costs. Subsequently, the lease asset is amortized
on a straight-line basis over its useful life.
Key estimates and judgments related to leases include how the Academy determines (1) the
discount rate it uses to discount the expected lease payments to present value, (2) lease term, and
(3) lease payments.
The Academy uses the interest rate charged by the lessor as the discount rate. When the
interest rate charged by the lessor is not provided, the Academy generally uses its
estimated incremental borrowing rate as the discount rate for leases.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
36
The lease term includes the noncancellable period of the lease. Lease payments included
in the measurement of the lease liability are composed of fixed payments and purchase
option price that the Academy is reasonably certain to exercise.
The Academy monitors changes in circumstances that would require a remeasurement of its lease
and will remeasure the lease asset and liability if certain changes occur that are expected to
significantly affect the amount of the lease liability.
Lease assets are reported with other capital assets and lease liabilities are reported with long-term
debt on the statement of net position.
8. Pensions and OPEB (“Other Post-Employment Benefits”)
The fiduciary net position of the Teacher Retirement System of Texas (TRS) has been determined
using the flow of economic resources measurement focus and full accrual basis of accounting.
This includes for purposes of measuring the net pension liability, OPEB liability, deferred
outflows of resources and deferred inflows of resources related to pensions/OPEB, pension/OPEB
expense, and information about assets, liabilities and additions to/deductions from TRS fiduciary
net position. Benefit payments (including refunds of employee contributions) are recognized
when due and payable in accordance with the benefit terms. Investments are reported at fair
value.
9. Net Position Flow Assumption
Sometimes the government will fund outlays for a particular purpose from both restricted (e.g.,
restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts
to report as restricted –net position and unrestricted –net position in the government-wide and
proprietary fund financial statements, a flow assumption must be made about the order in which
the resources are considered to be applied. It is the government’s policy to consider restricted –
net position to have been depleted before unrestricted –net position is applied.
10. Estimates
The preparation of financial statements, in conformity with generally accepted accounting
principles, requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenditures/expenses during
the reporting period. Actual results could differ from those estimates.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
37
F. Revenues and Expenditures/Expenses
Amounts reported as program revenues include 1) charges to services or applicants who
purchase, use, or directly benefit from goods, services, or privileges provided by a given function
or segment and 2) grants and contributions that are restricted to meeting the operational or
capital requirements of a particular function or segment. All grants, including those dedicated for
specific purposes, and other internally dedicated resources are reported as general revenues
rather than as program revenues.
NOTE 2. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
A.Explanation of certain differences between the governmental fund balance sheet and the
government-wide statement of net position.
The governmental fund balance sheet includes reconciliation between fund balance-total
governmental funds and net position-governmental activities as reported in the government-wide
statement of net position. One element of that reconciliation explains that long-term liabilities,
including bonds, are not due and payable in the current period and, therefore, are not reported in
the funds.
B.Explanation of certain differences between the governmental fund statement of revenues,
expenditures, and changes in fund balances and the government-wide statement of activities.
The governmental fund statement of revenues, expenditures, and changes in fund balances
includes a reconciliation between net changes in fund balances –total governmental funds and
changes in net position of governmental states that, “the issuance of long-term debt (e.g., bonds)
provides current financial resources to governmental funds, while the repayment of the
principal of long-term debt consumes the current financial resources of governmental funds.
Also, governmental funds report the effect of premiums, discounts, and similar items when debt
is first issued, whereas these amounts are deferred and amortized in the statement of activities.”
NOTE 3. STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
The Board of Trustees adopts an “appropriated budget” on a Generally Accepted Accounting
Principles (GAAP) basis for the general fund. The general fund budget appears in Exhibit E-1.
Prior to August 25 of the preceding fiscal year, the Academy prepares a budget for the next
succeeding fiscal year beginning September 1. 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 level by the staff. The function and fund level must be amended by approval of a majority
of the members of the Board.Westlake Academy employees can amend the budget within each
function as long as the total function expenditure remains the same as of the adopted budget.If
the total budgeted function expenditure is amended and different from the adopted budget, the
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
38
Board must approve that amendment.Appropriations lapse at the end of the year. During the
fiscal year ended June 30, 2024,several supplemental budget appropriations were made.
As of June 30, 2024,general fund expenditures did not exceed appropriations at the legal level of
control.
A.Restricted Net Position
The Academy records restricted net position on amounts with externally imposed restrictions
(e.g., through donor stipulations) or restrictions imposed by law through constitutional
provisions or enabling legislation. Total restricted net position for the primary government was
$2,834.
B.Deficit Fund Equity & Net Position
At June 30, 2024, the ESSER fund, IMA fund, and Local Grants fund had a deficit fund balances
of $27,609,$11,310,and $48,787, respectively. The deficit balances will be eliminated in the
future by decreasing expenditures and receiving additional grant funding.The Academy’s net
position had a deficit net position of $3,142,655, primarily as a result of the pension and OPEB
liabilities.
NOTE 4. DETAILED NOTES ON ALL FUNDS
A.Deposits and Investments
As of June 30, 2024, the Academy had the following investments:
Investment Type
External investment pools $116 0.08
Total fair value $116
Portfolio weighted average maturity 0.08
Weighted
Average Maturity
Value (Years)
Carrying
See the Westlake Academy Foundation’s annual report for their weighted average to maturity.
Credit risk: The Academy’s investment policy limits investments to obligations of the United
States, State of Texas, or their agencies and instrumentalities with an investment quality rating of
not less than “A” or its equivalent, by a nationally recognized investment rating firm. Other
obligations must be unconditionally guaranteed (either express or implied) by the full faith and
credit of the United States Government or the issuing U.S. agency and investment pools with an
investment quality not less than AAA or AAAm, or equivalent, by at least one nationally
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
39
recognized rating service. As of June 30, 2024, TexPool’s investments credit quality rating was
AAAm (Standard & Poor’s).
Custodial credit risk –deposits: In the case of deposits, this is the risk that in the event of a bank
failure, the Academy’s deposits may not be returned to it. As of June 30, 2024,the Academy’s
deposits with financial institutions in excess of federal depository insurance were fully
collateralized by the FDIC insurance and pledged collateral held by the Academy’s agent bank in
the Town of Westlake’s name.
Custodial credit risk –investments: For an investment, 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.The Academy’s investment
policy requires that it will seek to safeguard securities at financial institutions, avoiding physical
possession. Further, all trades, where applicable, are executed by delivery versus payment to
ensure that securities are deposited in the Academy’s safeguard account prior to the release of
funds.
TexPool
TexPool was established as a trust company with the Treasurer of the State of Texas as trustee,
segregated from all other trustees, investments, and activities of the trust company. The State
Comptroller of Public Accounts exercises oversight responsibility over TexPool. Oversight
includes the ability to significantly influence operations, designation of management, and
accountability for fiscal matters. Additionally, the State Comptroller has established an advisory
board composed of both participants in TexPool and other persons who do not have a business
relationship with TexPool. The advisory board members review the investment policy and
management fee structure. Finally, Standard & Poor’s rate TexPool AAAm. As a requirement to
maintain the rating, weekly portfolio information must be submitted to Standard & Poor’s, as
well as to the office of the Comptroller of Public Accounts for review.At June 30, 2024, the fair
value of the position in TexPool approximates fair value of the shares. There were no limitations
or restrictions on withdrawals.
B.Fair Value Measurements
The Foundation categorizes its fair value measurements within the fair value hierarchy
established by generally accepted accounting principles. The hierarchy is based on the valuation
inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active
markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs
are significant unobservable inputs.
Level 1 Inputs to the valuation methodology are unadjusted quoted prices for identical
assets or liabilities in active markets that the plan has the ability to access.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
40
Level 2 Inputs to the valuation methodology include
quoted prices for similar assets or liabilities in active markets;
quoted prices for identical or similar assets or liabilities in inactive markets;
inputs other than quoted prices that are observable for the asset or liability; and
inputs that are derived principally from our corroborated by observable market
data by correlation or other means.
If the asset or liability has a specified (contractual) term, the level 2 input must be
observable for substantially the full term of the asset or liability.
Level 3 Inputs to the valuation methodology are unobservable and significant to the fair
value measurement.
The asset’s or liability’s fair value measurement level within the fair value hierarchy is based
on the lowest level of any input that is significant to the fair value measurement. Valuation
techniques used need to maximize the use of observable inputs and minimize the use of
unobservable inputs.
The following is a description of the valuation methodologies used for assets measured at fair
value. There have been no changes in the methodologies used at June 30, 2024.
Marketable Equity Securities: Valued at the last reported daily price
The preceding methods described may produce a fair value calculation that may not be
indicative of net realizable value or reflective of future fair values. Furthermore, although the
plan believes its valuation methods are appropriate and consistent with other market
participants, the use of different methodologies or assumption to determine the fair value of
certain financial instruments could result in a different fair value measurement at the
reporting date.
The following table sets forth by level, within the fair value hierarchy, the Component Unit’s
fair value measurements at June 30, 2024.
Ma rketa ble eq uity securities:
Eq uity $1,570,442 $- $- $1,570,442
Fix ed in come 979,811 - - 979,811
Total assets measured at fair value:$2,550,253 $- $- $2,550,253
Level 1 Lev el 2 Level 3 TotalInvestment Type
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
41
C.Receivables
The following comprise receivable balances of the primary government at year end:
Due to other governments
State entitlements $1,339,781 $- 1,339,781
Other 23,700 41,307 65,007
Total $1,363,481 $41,307 1,404,788
Total
Nonmajor
Govt.General
D.Capital Assets
Capital asset activity for the year ended June 30, 2024, was as follows:
Capital assets, being depreciated:
Right to use leased equipment 581,716 - - 581,716
581,716 - - 581,716
Less accumulated depreciation
Right to use leased equipment 226,223 161,588 - 387,811
Total accumulated depreciation 226,223 161,588 - 387,811
Net capital assets being depreciated 355,493 (161,588) - 193,905
$355,493 *$(161,588) $- $193,905
Beginning Disposals /Ending
Balances *Increases
Total Capital Assets
Total capital assets being depreciated
BalancesReclassifications
*Beginning balances are stated as of August 31, 2023. Current year activity spans 10 months due
to the Academy’s fiscal year end change to June 30.
Depreciation was charged to governmental functions as follows:
0011 In struction $161,588
$161,588 Tota l Governmenta l Activitie s Depre ciatio n Expe nse
E.Long-term Debt –Lease Payable
The Academy entered into a three-year lease agreement on July 1, 2022, as lessee for the
acquisition and use of various Apple products and software licenses. The total initial lease
liability for the agreement was recorded in the amount of $581,716. As of June 30, 2024, the
value of the lease liability was $202,804.The Academy is required to make monthly
principal/interest payments of $17,362. The lease has an interest rate of 5%. In addition, the
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
42
office equipment has a three-year estimated useful life. The value of the right-to-use assets as of
the end of the current fiscal year was $840,769 and had accumulated amortization of $461,038.
The following summarizes the changes in lease payable during the year.
Gove rnmenta l Activitie s:
Leases $364,260 $- $(1 61,456) $202,804 $202,804
To ta l G overnme ntal Ac tivitie s $364,260 $- $(1 61,456) $202,804 $202,804
Lo ng -te rm Lia bilitie s Due in Mo re tha n One Y ear $-
Am ounts
Due Within
One Y ear
Beginning
Balance *Additio ns Re ductio ns
Ending
Balance
*Beginning balances are stated as of August 31, 2023. Current year activity spans 10 months due
to the Academy’s fiscal year end change to June 30.
The annual requirements to amortize lease obligations as of June 30, 2024, are as follows:
Go ve rnmental Activitie s
Year Ending Total
Aug ust 3 1,Re quire ments
2025 $202,804 $3,913 $206,717
Tot al $202,804 $3,913 $206,717
Leases
Inte re stPrincipal
F.Interfund Transactions
The composition of interfund balances as of the year ended June 30, 2024 were as follows:
Due fro m:
General fund $78,242 $90,305 $168,547
To ta l $78,242 $90,305 $168,547
Due to :
To ta l
No nm ajor
ESSER Go vt.
Interfund balances resulted from the timing difference between the dates that (1) interfund
goods and services are provided or reimbursable expenditures occur, (2) transactions are
recorded in the accounting system, and (3) payments between funds are made. All balances are
expected to be paid in the subsequent year.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
43
NOTE 5. OTHER INFORMATION
A.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.
B.Litigation and Contingencies
The Academy is a party to various legal actions none of which is believed by administration to
have a material effect on the financial condition of the Academy. Accordingly, no provision for
losses has been recorded in the accompanying combined financial statements for such
contingencies.
The Academy participates in state and federal grant programs which are governed by various
rules and regulations of the grantor agencies. Costs charged to the respective grant programs are
subject to audit and adjustment by the grantor agencies; therefore, to the extent that the
Academy has not complied with the rules and regulations governing the grants, if any, refunds
of any money received may be required and the collectability of any related receivable at June
30, 2024 may be impaired. In the opinion of the Academy, there are no significant contingent
liabilities relating to compliance with the rules and regulations governing the respective grants;
therefore, no provision has been recorded in the accompanying combined financial statements
for such contingencies.
C. Defined Benefit Pension Plan
Plan Description
The Westlake Academy participates in a cost-sharing multiple-employer defined benefit pension
that has a special funding situation. The plan is administered by the Teacher Retirement System
of Texas (TRS). It is a defined benefit pension plan established and administered in accordance
with the Texas Constitution, Article XVI, Section 67 and Texas Government Code, Title 8,
Subtitle C. The pension trust fund is a qualified pension trust under Section 401(a) of the Internal
Revenue Code. The Texas Legislature establishes benefits and contribution rates within the
guidelines of the Texas Constitution. The pension’s Board of Trustees does not have the
authority to establish or amend benefit terms.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
44
All employees of public, state-supported educational institutions in Texas who are employed for
one-half or more of the standard workload and who are not exempted from membership under
Texas Government Code, Title 8, Section 822.002 are covered by the system.
Pension Plan Fiduciary Net Position
Detail information about the Teacher Retirement System’s fiduciary net position is available in a
separately issued Annual Comprehensive Financial Report (ACFR) that includes financial
statements and required supplementary information. That report may be obtained on the
Internet at https://www.trs.texas.gov/TRS%20Documents/2023%20ACFR%20Final%2011-20-
2023.pdf; by writing to TRS at 1000 Red River Street, Austin, TX, 78701-2698, or by calling (512)
542-6592.
Benefits Provided
TRS provides service and disability retirement, as well as death and survivor benefits, to eligible
employees (and their beneficiaries) of public and higher education in Texas. The pension
formula is calculated using 2.3 percent (multiplier) times the average of the five highest annual
creditable salaries times years of credited service to arrive at the annual standard annuity except
for members who are grandfathered, the three highest annual salaries are used. The normal
service retirement is at age 65 with 5 years of credited service or when the sum of the member’s
age and years of credited service equals 80 or more years. Early retirement is at age 55 with 5
years of service credit or earlier than 55 with 30 years of service credit. There are additional
provisions for early retirement if the sum of the member’s age and years of service credit total at
least 80, but the member is less than age 60 or 62 depending on date of employment, or if the
member was grandfathered in under a previous rule. There are no automatic post-employment
benefit changes; including automatic COLAs. Ad hoc post-employment benefit changes,
including ad hoc COLAs can be granted by the Texas Legislature as noted in the Plan
description in (A) above.
Texas Government Code section 821.006 prohibits benefit improvements, if, as a result of the
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. Actuarial implications of the funding
provided in the manner are determined by the System’s actuary.
Contributions
Contribution requirements are established or amended pursuant to Article 16, section 67 of the
Texas Constitution which requires the Texas legislature to establish a member contribution rate
of not less than 6 percent of the member’s annual compensation and a state contribution rate of
not less than 6 percent and not more than 10 percent of the aggregate annual compensation paid
to members of the system during the fiscal year.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
45
Employee contribution rates are set in state statute, Texas Government Code 825.402. The TRS
Pension Reform Bill (Senate Bill 12) of the 86th Texas Legislature amended Texas Government
Code 825.402 for member contributions and increased employee and employer contribution
rates for fiscal years 2019 thru 2025.
Schedule of Contribution Rates
Contribution Rates 2023
(Rate)
2024
(Rate)
Member 8.00%8.25%
Non-employer contributing entity (State)8.00%8.25%
Employers 8.00%8.25%
The employer and member contributions for the Academy’s fiscal year 2024 amounted to
$295,372 and $490,370, respectively. The State’s contributions for plan year 2023 (measurement
year)amounted to $299,155.
Contributors to the plan include members, employers and the State of Texas as the only non-
employer contributing entity. The State is the employer for senior colleges, medical schools and
state agencies including TRS. In each respective role, the State contributes to the plan in
accordance with state statutes and the General Appropriations Act (GAA).
As the non-employer contributing entity for public education and junior colleges, the State of
Texas contributes to the retirement system an amount equal to the current employer
contribution rate times the aggregate annual compensation of all participating members of the
pension trust fund during that fiscal year reduced by the amounts described below which are
paid by the employers. Employers (public school, junior college, other entities or the State of
Texas as the employer for senior universities and medical schools) are required to pay the
employer contribution rate in the following instances:
On the portion of the member's salary that exceeds the statutory minimum for members
entitled to the statutory minimum under Section 21.402 of the Texas Education Code.
During a new member’s first 90 days of employment.
When any or all of an employee’s salary is paid by federal funding sources, a privately
sponsored source, from non-educational and general, or local funds.
When the employing district is a public junior college or junior college district, the
employer shall contribute to the retirement system an amount equal to 50 percent of the
state contribution rate for certain instructional or administrative employees; and 100
percent of the state contribution rate for all other employees
In addition to the employer contributions listed above, there is an additional surcharge an
employer is subject to.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
46
All public schools, charter schools, and regional educational service centers must
contribute 1.8 percent of the member’s salary beginning in fiscal year 2023, gradually
increasing to 2 percent in fiscal year 2025.
When employing a retiree of the Teacher Retirement System, the employer shall pay both
the member contribution and the state contribution as an employment after retirement
surcharge.
Actuarial Assumptions
The Total Pension Liability in the August 31, 2022 actuarial valuation was determined using the
following actuarial assumptions:
Valuation Date August 31, 2022 (rolled forward to August 31,
2023)
Actuarial Cost Method Individual entry age normal
Asset Valuation Method Market value
Single Discount Rate 7.00%
Investment Rate of Return 7.25%
Municipal Bond Rate as of August 2020 2.33% as reported in Fidelity Index’s 20-year
Municipal GO
Inflation 2.30% per year
Overall payroll growth 3.05% to 9.05%, including inflation
Active mortality rates Based on 90% of the RP 2014 Employing
Mortality Tables for males and females with
full generational mortality. The post-
retirement mortality rates for healthy lives
were based on the 2018 TRS of Texas Health
Pensioner Mortality Tables with full
generational projection using the ultimate
improvement rates from the most recently
published projective scale U-MP.
The actuarial methods and assumptions are used in the determination of the total pension
liability are the same assumptions used in the actuarial valuation as of August 31, 2022. For a full
description of these assumptions please see the actuarial valuation report dated November 12,
2022.
Discount Rate
A single discount rate of 7.00 percent was used to measure the total pension liability. The single
discount rate was based on the expected rate of return on plan investments of 7.00 percent. The
projection of cash flows used to determine this single discount rate assumed that contributions
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
47
from active members, employers and the non-employer contributing entity will be made at the
rates set by the legislature during the 2019 session. It is assumed that future employer and state
contributions will be 9.50 percent of payroll in fiscal year 2024 gradually increasing to 9.56
percent in fiscal year 2025 and thereafter.This includes all employer and state contributions for
active and rehired retirees.
Based on those assumptions, the pension plan’s fiduciary net position was projected to be
available to make all future benefit payments of current plan members. Therefore, the long-term
expected rate of return on pension plan investments was applied to all periods of projected
benefit payments to determine the total pension liability.
The long-term rate of return on pension plan investments is 7.00 percent. The long-term expected
rate of return on pension plan investments was determined using a building-block method in
which best estimates ranges of expected future real rates of return (expected returns, net of
pension plan investment expense and inflation) are developed for each major asset class. These
ranges are combined to produce the long-term expected rate of return by weighting the expected
future real rates of return by the target asset allocation percentage and by adding expected
inflation. Best estimates of geometric real rates of return for each major asset class as of August
31, 2023 (see page 56 of the TRS ACFR) are summarized in the following table:
Asset Class Target Allocation Long-Term Expected
Real Rate of Return
(Geometric)
Expected
Contribution to
Long-Term
Portfolio
Returns
Global Equity 54.0 %20.3 % 4.10 %
Stable Value 21.0 10.2 0.70
Real Return 21.0 4.9 1.50
Risk Parity 8.0 4.5 0.40
Asset Allocation
Leverage
(4.0) 8.10 (0.10)
Inflation 2.30
Volatility Drag (0.90)
Total 100.0%8.00%
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
48
Discount Rate Sensitivity Analysis
The following table presents the Net Pension Liability of the plan using the discount rate of
7.00%, and what the net pension liability would be if it were calculated using a discount rate that
is one percentage point lower (6.00%) or one percentage point higher (8.00%) than the current
rate.
1% Dec rease Discount Rate 1% In cr ea se
6.00%7.00% 8.00%
Ac adem y's proportionate
sh ar e of the net pension $6,563,389 $4,390,064 $2,582,943
Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources
Related to Pensions:
At June 30, 2024, the Academy reported a liability of $4,390,064 for its proportionate share of the
TRS’s net pension liability. This liability reflects a reduction for State pension support provided to
the Academy. The amount recognized by the Academy as its proportionate share of the net
pension liability, the related State support, and the total portion of the net pension liability that
was associated with the Academy were as follows:
Academy’s proportionate share of the collective net pension liability $4,390,064
State’s proportionate share that is associated with Academy 3,997,690
Total $8,387,754
The net pension liability was measured as of August 31, 2022 (and rolled forward to August 31,
2023) and the total pension liability used to calculate the net pension liability was determined by
an actuarial valuation as of that date.The Academy’s proportion of the net pension liability was
based on the Academy’s contributions to the pension plan relative to the contributions of all
employers to the plan for the period September 1, 2022 thru August 31, 2023.
At August 31, 2023, the employer’s proportion of the collective net pension liability was
0.0063911%,which was an increase of 0.0005543632% from its proportion measured as of August
31, 2022.
Changes since the Prior Measurement Date
The actuarial assumptions and methods are the same as used in the determination of the prior
year's net pension liability.
The Texas 2023 Legislature passed legislation that provides a one-time stipend to certain retired
teachers.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
49
The stipend was paid to retirees beginning in September of 2023. The Legislature appropriated
funds to pay for this one-time stipend so there will be no impact on the net pension liability of
TRS. In addition, the Legislature also provided for a cost-of-living adjustment (COLA) to retirees
which was approved during the November 2023 election which will be paid in January 2024.
Therefore, this contingent liability was not reflected as of June 30, 2024.
For the year ended June 30, 2024, the Academy recognized pension expense of $1,607,920 and
revenue of $603,617 for support provided by the State.
At June 30, 2024, the Academy reported deferred outflows and inflows of resources related to
pensions from the following sources:
Di ffer en ces between ex pect ed a nd a ct ual econ om ic
ex perien ce $156,419 $53,159
Ch anges i n act uar ia l assumptions 415,214 101,612
Di ffer en ce b et ween project ed and a ctual investment
ea rnings 1,371,762 732,901
Ch anges i n pr op or tion a nd differ en ce b et ween t he
em ploy er 's cont ribution s and propor tionate s hare of
cont ributions 836,325 100,617
Con tributions subsequ en t to t he m ea surement da te 295,372 -
Tota l $3,075,092 $988,289
Deferre d
Outflows
of Re so urces
Deferred
(Inflows)
of Re so urces
Deferred outflows of resources related to pensions resulting from contributions subsequent to the
measurement date of $295,372 will be recognized as a reduction of the net pension liability for the
year ending June 30, 2025.
Other amounts reported as deferred outflows and inflows of resources related to pensions will be
recognized in pension expense as follows:
Ye ar e nded June 3 0:
2025 $479,211
2026 387,001
2027 651,270
2028 227,797
2029 46,152
Ther ea ft er -
$1,791,431
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
50
D.Health Care Coverage
During the period ended June 30, 2024, employees of the Academy who met minimum
eligibility requirements were covered by a state-wide health care plan, TRS Active Care. The
Academy's participation in this plan is renewed annually. The Academy paid into the Plan
$397 per month per employee and $322 per month when the employee works less than 30
hours per week if eligible to enroll in TRS Active Care. Employees, at their option, pay
premiums for any coverage above these amounts as well as for dependent coverage.
The Teacher Retirement System (TRS) manages TRS Active Care. The medical plan is
administered by Aetna, and Caremark 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.
E.Defined Other Post Employment Benefit Plan
Plan Description
The Academy participates in the Texas Public School Retired Employees Group Insurance
Program (TRS-Care). It is a multiple-employer, cost-sharing, defined benefit OPEB plan with
a special funding situation.The TRS-Care program was established in 1986 by the Texas
Legislature.The TRS Board of Trustees administers the TRS-Care program and the related
fund in accordance with Texas Insurance Code Chapter 1575. The Board of Trustees is
granted the authority to establish basic and optional group insurance coverage for
participants as well as to amend benefit terms as needed under Chapter 1575.052. The Board
may adopt rules, plans, procedures, and orders reasonably necessary to administer the
program, including minimum benefits and financing standards.
OPEB Plan Fiduciary Net Position
Detail information about the TRS-Care’s fiduciary net position is available in the separately-
issued TRS Comprehensive Annual Financial Report that includes financial statements and
required supplementary information. That report may be obtained on the Internet at
https://www.trs.texas.gov/TRS%20Documents/2023%20ACFR%20Final%2011-20-2023.pdf;
by writing to TRS at 1000 Red River Street, Austin, TX, 78701-2698; or by calling (512) 542-
6592.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
51
Benefits Provided
TRS-Care provides a basic health insurance coverage (TRS-Care 1), at no cost to all retirees
from public schools, charter schools, regional education service centers and other
educational academies who are members of the TRS pension plan. Optional dependent
coverage is available for an additional fee.
Eligible non-Medicare retirees and their dependents may enroll in TRS-Care Standard, a
high-deductible health plan. Eligible Medicare retirees and their dependents may enroll in
the TRS-Care Medicare Advantage medical plan and the TRS-Care Medicare Rx prescription
drug plan. To qualify for TRS-Care coverage, a retiree must have at least 10 years of service
credit in the TRS pension system. There are no automatic post-employment benefit changes;
including automatic COLAs.
The premium rates for the optional health insurance are based on years of service of the
member.The schedule below shows the monthly rates for a retiree with and without
Medicare coverage.
Retiree or Suvivin g Spouse $135 $200
Retiree an d Spouse 529 689
Retiree or Suvivin g Spouse
an d Ch ildren 468 408
Retiree an d Family 1,020 999
Medi ca re Non -Medi car e
TR S-Car e Monthly Premium Rat es
Contributions
Contribution rates for the TRS-Care plan are established in state statute by the Texas
Legislature, and there is no continuing obligation to provide benefits beyond each fiscal
year. The TRS-Care plan is currently funded on a pay-as-you-go basis and is subject to
change based on available funding. Funding for TRS-Care is provided by retiree premium
contributions and contributions from the state, active employees, and schools based upon
school payroll. The TRS Board of trustees does not have the authority to set or amend
contribution rates.
Texas Insurance Code, section 1575.202 establishes the state’s contribution rate which is
1.25% of the employee’s salary. Section 1575.203 establishes the active employee’s rate which
is .65% of pay. Section 1575.204 establishes an employer contribution rate of not less than
0.25% or not more than 0.75% of the salary of each active employee of the public. The actual
employer contribution rate is prescribed by the Legislature in the General Appropriations
Act. The following table shows contributions to the TRS-Care plan by type of contributor.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
52
Schedule of Contribution Rates
Contribution Rates 2023
(Rate)
2024
(Rate)
Active employee 0.65%0.65%
Non-employer contributing entity (State)1.25%1.25%
Employers 0.75%0.75%
Federal/Private Funding 1.25%1.25%
The employer and member contributions for the Academy’s fiscal year 2023 amounted to
$50,495 and $38,634, respectively. The State’s contributions for plan year 2022 (measurement
year)amounted to $70,196.
In addition to the employer contributions listed above, there is an additional surcharge all
TRS employers are subject to (regardless of whether or not they participate in the TRS Care
OPEB program). When employers hire a TRS retiree, they are required to pay to TRS Care, a
monthly surcharge of $535 per retiree.
TRS-Care received supplemental appropriations from the State of Texas as the
Non-Employer Contributing Entity in the amount of $21.3 million in fiscal year 2023
provided by Rider 14 of the Senate Bill GAA of the 87th Legislature. These amounts were
re-appropriated from amounts received by the pension and TRS-Care funds in excess of the
state's actual obligation and then transferred to TRS-Care.
Actuarial assumptions:
The actuarial valuation of the total OPEB liability was performed as of August 31, 2022.
Update procedures were used to roll forward the total OPEB liability to August 31, 2023. The
actuarial valuation was determined using the following actuarial assumptions: Actuarial
Assumptions can be found in the 2023 TRS ACFR, Note 9, page 79.
The actuarial valuation of the OPEB plan offered through TRS-Care is similar to the actuarial
valuation performed for the pension plan, except that the OPEB valuation is more complex.
The demographic assumptions were updated based on the experience study performed for
TRS for the period ending August 31, 2021. The following assumptions and other inputs
used for members of TRS-Care are based on an established pattern of practice and are
identical to the assumptions used in the August 31, 2022 TRS pension actuarial valuation
that was rolled forward to August 31, 2023:
The active mortality rates were based on PUB(2010), Amount-Weighted, Below-Median
Income, Teacher male and female tables (with a two-year set forward for males). The
post-retirement mortality rates for healthy lives were based on the 2021 TRS of Texas
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
53
Healthy Pensioner Mortality Tables. The rates were projected on a fully generational basis
using the ultimate improvement rates from mortality projection scale MP-2021.
Actuarial cost method Individual entry age normal
Inflation 2.3% per year
Discount rate 3.91%, as reported in Fidelity Index’s 20-year
Municipal GO AA Index as of August 31,
2022
Election rates Normal Retirement; 65% participation prior
to age 65 and 40% after age 65. 25% of pre-65
retirees are assumed to discontinue coverage
at age 65.
Healthcare trend rates 9% for Medicare retirees and 7.30% for non-
Medicare retirees
Administrative expenses Third-party administrative expenses related
to the delivery of health care benefits are
included in the age-adjusted claims costs.
Discount Rate:
A single discount rate of 4.13% was used to measure the total OPEB liability at August 31,
2023. This was an increase of 0.22% in the discount rate since the previous measurement
date.
Because the investments are held in cash and there is no intentional objective to advance
fund the benefits, the Single Discount Rate is equal to the prevailing municipal bond rate.
The source of the municipal bond rate is the Fidelity “20-year Municipal GO AA Index” as of
August 31, 2023 using the Fixed Income Market Data/Yield Curve/ Data Municipal bonds
with 20 years to maturity that include only federally tax-exempt municipal bonds.
Discount Rate Sensitivity Analysis
The following presents the total OPEB liability of the Academy, calculated using the
discount rate of 4.13%, as well as what the Academy’s total OPEB liability (asset) would be if
it were calculated using a discount rate that is 1-percentage-point lower (3.13%) or 1-
percentage-point higher (5.13%) than the current rate:
1% Decr ease Discount Rate 1% Increase
3.13%4.13%5.13%
Academ y's pr oportionate sh are
of the net OPEB liab ilit y $1,748,578 $1,484,624 $1,269,231
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
54
Healthcare Cost Trend Rates Sensitivity Analysis
The following presents the net OPEB liability of the plan using the assumed healthcare cost
trend rate, as well as what the net OPEB liability would be if it were calculated using a trend
rate that is one-percentage point lower or one-percentage point higher than the assumed
healthcare cost trend rate.
1% Decr ease 1% In cr ease
in Trend Rat e Tr end Rate in Trend Rate
Academy 's proportionate sh are
of the net OPEB liabilit y $1,222,513 $1,484,624 $1,821,830
OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to OPEBs
At June 30, 2024, the Academy reported a liability of $1,484,624 for its proportionate share of
the TRS’s Net OPEB Liability. This liability reflects a reduction for State OPEB support
provided to the Academy. The amount recognized by the Academy as its proportionate
share of the net OPEB liability, the related State support, and the total portion of the net
OPEB liability that was associated with the Academy were as follows:
Academy’s proportionate share of the collective net OPEB liability $1,484,624
State’s proportionate share that is associated with Academy _1,791,427
Total $3,276,051
The Net OPEB Liability was measured as of August 31, 2022 and rolled forward to August
31, 2023 and the Total OPEB Liability used to calculate the Net OPEB Liability was
determined by an actuarial valuation as of that date. The employer’s proportion of the Net
OPEB Liability was based on the employer’s contributions to the OPEB plan relative to the
contributions of all employers to the plan for the period September 1, 2022 thru August 31,
2023.
At August 31, 2023 the employer’s proportion of the collective Net OPEB Liability was
.006706%,which was an increase of .00011191% the same proportion measured as of August
31, 2022.
Changes Since the Prior Actuarial Valuation
The following were changes to the actuarial assumptions or other inputs that affected
measurement of the Total OPEB liability since the prior measurement period.
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
55
The discount rate increased from 3.91% as of August 31, 2022 to 4.13% as of August
31, 2023. This change decreased the total OPEB liability.
Changes of Benefit Terms Since the Prior Measurement Date –There were no changes in
benefit terms since the prior measurement date.
For the year ended June 30, 2024, the Academy recognized OPEB gain of $619,359 and
revenue of $382,969 for support provided by the State.
At June 30, 2024, the Academy reported deferred outflows of resources and deferred inflows
of resources related to the OPEB liability from the following sources:
Di ffer en ces b et ween expect ed a nd a ct ual ec onom ic
experien ce $67,168 $1,249,030
Ch anges i n actuar ial assumpt ions 202,640 909,075
Di ffer en ce b et ween p roject ed a nd a ct ua l invest ment
ea rnings 641 -
Ch anges i n pr opor tion a nd differ en ce b et ween t he
em ployer's contribution s and proportion ate share of
contributions 358,804 4,834
Con tributions sub sequ en t to t he m ea sur em en t date 50,495 -
Tota l $679,748 $2,162,939
Deferre d
Outflo ws
of Re source s
Deferre d
(Inflo ws)
of Re sources
The Academy reported $50,495 as deferred outflows of resources related to OPEB resulting
from contributions subsequent to the measurement date that will be recognized as a
reduction of the net OPEB liability for the year ending June 30, 2025.
Other amounts reported as deferred outflows of resources related to OPEB will be
recognized in OPEB expense as follows:
Year e nde d June 3 0:
2025 $(3 59,984)
2026 (2 91,890)
2027 (1 99,703)
2028 (2 30,043)
2029 (1 93,930)
Ther ea ft er (2 58,136)
$(1 ,5 33,686)
Westlake Academy
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 2024
56
F.Related Party Transactions
The Westlake Academy Foundation contributed $1,129,384 to the Academy during the ten-
month fiscal period ended June 30, 2024.The Westlake Academy Foundation made $181,210
of in-kind contributions (i.e. meals, grant supplies, travel/training reimbursements) to the
Academy for instructional grant related activities.In addition, transactions paid directly by
Westlake Academy and reimbursed by the Westlake Academy Foundation totaled $53,240.
G.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; however, the
Academy recognizes the value of the use received, $1,296,042, in the government-wide
statement of activities as capital grants and contributions and as expense allocated to the
various functions.
H.Restatements
Due to corrections to prior year accrued liabilities, capital assets, and receivables from Town
of Westlake, the Academy restated beginning net position/fund balance governmental
activities, the general fund, and one nonmajor governmental fund. The restatement of
beginning fund balance/net position is as follows:
$(3,450,477) $1,137,035 $112,068
Adjustment to unemployment liab ility 61,985 61,985 -
Accrued liab ility e rror 92,675 92,675 -
Correction to Due to Town of Westlake (3,500) - (3,500)
Correction to capital assets (185,826) - -
Re stated b eginning net position/fund b alance $(3,485,143) $1,291,695 $108,568
Governmental
Activities General
Prior year ending net position/fund b alance, as
reported
Nonmajor
Governmental
I.Subsequent Events
There were no other material subsequent events through November 11, 2024, the date the
financial statements were issued.
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REQUIRED SUPPLEMENTARY INFORMATION
59
60
Exhibit E-1
Revenues
5700 Local and intermediate sources $3,076,581 $2,918,882 $2,794,135 $ (124,747)
5800 State program revenues 8,059,538 8,059,538 7,952,021 (107,517)
5020 11,136,119 10,978,420 10,746,156 (232,264)
Expenditures
Current:
0011 Instruction 5,817,470 5,862,523 5,015,099 847,424
0012 Instructional resources and media 193,746 198,077 123,472 74,605
0013 Curriculum and staff development 63,400 67,000 40,545 26,455
0021 Instructional leadership 288,937 294,337 252,002 42,335
0023 School leadership 1,300,586 1,340,786 1,085,587 255,199
0031 Guidance, counseling, evaluations 586,991 690,041 640,771 49,270
0033 Health services 133,600 101,950 79,050 22,900
0036 Extracurricular activities 450,493 452,983 355,575 97,408
0041 General administration 485,332 601,019 584,578 16,441
0051 Facilities maintenance and operations 1,029,456 1,153,566 1,090,851 62,715
0052 Security and monitoring services 56,400 30,900 16,461 14,439
0053 Data processing services 345,341 400,904 404,735 (3,831)
0061 Community services 157,699 161,699 159,256 2,443
Debt service:
0071 Principal 214,495 222,994 161,456 61,538
0072 Interest 12,173 12,173 20,422 (8,249)
11,136,119 11,590,952 10,029,860 1,561,092
1100 - (612,532) 716,296 1,328,828
1200 Net Change in Fund Balance $- $(612,532) 716,296 $1,328,828
0100 Beginning fund balance 1,291,695
3000 $2,007,991
Notes to Required Supplementary Information
1. Annual budgets are adopted on a basis consistent with generally accepted accounting principles (GAAP).
Total Expenditures
Ending Fund Balance
Actual (Negative)
Revenues Over (Under)
Expenditures
Total Revenues
PositiveFinal
Budget
Final Budget
GENERAL FUND
For the Year Ended June 30, 2024
Original
Budget
Data
Control
Codes
Westlake Academy
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Variance with
61
62
1.
2.
3.
4.
Prior to July 1,the budget is legally enacted through resolution by the Board.Once a budget is
approved,it can only be amended at the object by the staff,function and fund level must be amended 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.
Westlake Academy employees can amend the budget within each function as long as the total function
expenditure remains the same as adopted budget.If the total budgeted function expenditure is amended
and different from adopted budget,the Board must approve the amendment.All budget appropriations
lapse at year end.
A meeting of the Board of Trustees is then called for the purpose of adopting the proposed budget.
Westlake Academy
NOTES TO THE BUDGETARY COMPARISON SCHEDULE
For the Year Ended June 30, 2024
Budgetary Information
The Board of Trustees 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:
Prior to June 25 of the preceding fiscal year,the Academy prepares a budget for the next succeeding
fiscal year beginning July 1.The operating budget includes proposed expenditures and the means of
financing them.
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71
Did your LEA expend any state compensatory education
program state allotment funds during the district’s fiscal
year?
Does the LEA have written policies and procedures for its
state compensatory education program?
List the total state allotment funds received for state
compensatory education programs during the district’s
fiscal year $31,185
List the actual direct program expenditures for state
compensatory education programs during the LEA’s fiscal
year. (PICs 24, 26, 28, 29, 30, 34)$23,328
Section B : Bilingual Education Programs
Did your LEA expend any bilingual education program
state allotment funds during the LEA’s fiscal year?
Does the LEA have written policies and procedures for its
bilingual education program?
List the total state allotment funds received for bilingual
education programs during the LEA’s fiscal year.$19,006
List the actual direct program expenditures for bilingual
education programs during the LEA’s fiscal year.(PICs 25,
35)$82,802
AP5
AP6
AP7
AP8
Yes
Yes
AP1
AP2
AP3
AP4
Westlake Academy
USE OF FUNDS REPORT
For the Ten Months Ended June 30, 2024
Data Control
Codes Section A : Compensatory Education Programs
Column 1
Responses
Exhibit J-4
Yes
Yes
72
73
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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
Independent Auditor’s Report
To the Board of Trustees
Westlake Academy:
We have audited, 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,the financial statements of the governmental
activities,discretely presented component unit, each major fund, and the aggregate remaining fund
information of the Westlake Academy as of and for the ten months ended June 30, 2024, and the
related notes to the financial statements, which collectively comprise Westlake Academy’s basic
financial statements, and have issued our report thereon dated November 11, 2024.
Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Westlake
Academy’s internal control over financial reporting (internal control) to determine the audit
procedures that are appropriate in the circumstances for the purpose of expressing our opinions on
the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the
Westlake Academy’s internal control. Accordingly, we do not express an opinion on the effectiveness
of the Westlake Academy’s internal control.
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. A significant deficiency is a deficiency, or a combination of deficiencies, in
internal control that is less severe than a material weakness, yet important enough to merit attention
by those charged with governance.
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
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over financial reporting that might be material weaknesses or significant deficiencies. Given these
limitations, during our audit we did not identify any deficiencies in internal control that we consider
to be material weaknesses. However, material weaknesses may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Westlake Academy’s financial
statements are free from 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.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of the
entity’s internal control or on compliance. This report is an integral part of an audit performed in
accordance with Government Auditing Standards in considering the entity’s internal control and
compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully,
BrooksWatson & Co., PLLC
14950 Heathrow Forest Pkwy | Ste 530
Houston, TX 77032
November 11, 2024