11 Unrestricted Net Assets Describe the unrestricted net assets projections: 1. Describe the university reserve levels throughout the projection period and the steps undertaken or planned, to stabilize reserves and establish progress towards the 40% unrestricted net asset sustainability goal. As detailed in the prior sections, Kutztown University is in a strong financial position with a balanced annual budget and increasing net assets. Our financial position has been improved by the $10 million one-time allocation of CSFRF funds in fiscal year 2022-23 and now the more reliable and substantial increase to state appropriations over the past few years. We have accumulated these reserves with a purpose. First, to address our lagging financial indicators and become a more financially sustainable university. This is evidenced by our steady improvement and current strong standing of our primary reserve ratio (41.6%) and minimum reserves (229 days) which now both fall at the green level for the most recent fiscal year. Second, to address our deferred maintenance needs and invest in our aging facilities so that Kutztown can continue to attract students and operate at a high level. We believe this is not only a good business decision but our responsibility as good stewards of the resources we are given to accomplish our mission. Unrestricted Net Assets Chart Actual Reforecast FY 2022-23 FY 2023-24 FY 2024-25 % Change FY 2025-26 % Change FY 2026-27 % Change Total Actual/Estimated Unrestricted Net Assets $75.5 $85.0 $87.8 3.3% $83.5 -4.9% $79.6 -4.6% Total Actual/Estimated End of Year Cash Balance $93.0 $102.5 $105.3 2.8% $101.0 -4.1% $97.2 -3.8% Projected Ratios resulting from the Annual Projection Plan - Will NOT Match Final Metric Results Estimated Annual Primary Reserve Ratio 41.6% n/a n/a n/a n/a Estimated End of Year Balance in Net Assets/Total Expenses (From FINRPT) Estimated Progress to Unrestricted Net Asset Goal (40%) 45% 49% 48% 45% 42% Estimated End of Year Balance in Unrestricted Net Assets/Total Unrestricted Expenses (from CPP) Estimated Minimum Reserves 229 n/a n/a n/a n/a Unrestricted cash*365/total unrestricted expenses Projected ($ in Millions) I I I I I I
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