LWIB Finance Committee Meeting Agenda March 12, 2015 Garvey Center 7:30 a.m.

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1 LWIB Finance Committee Meeting Agenda March 12, 2015 Garvey Center 7:30 a.m. Mission Identify sources of revenue, including but not limited to the funding streams of the Workforce Investment Act, and develop a budget that will provide the Board the financial resource necessary to carry out its mission. 1. Welcome and Introductions: Kathy Jewett (7:30) 2. Approval of Minutes from September 25, 2014: Kathy Jewett (7:35) Recommended Action: Approve or modify minutes as needed. 3. PY14 Budget Update: Chad Pettera (7:40) Recommended Action: Receive and File. 4. PY14 Adult and Dislocated Worker Funding Transfer (7:50) Recommended Action: Approve the Transfer of Funds 5. PY13 Audit Report (8:00) Receive and File 6. New Leaf (8:15) Receive and File 7. WIOA (8:20) Receive and File 8. Unscheduled Topics: Finance Committee Members (8:25) 9. Adjourn (8:30) The Workforce Alliance Executive Committee will meet at 11:30 a.m. on March 18, 2015.

2 LWIB Finance Committee Meeting Minutes September 25, 2014 On September 25, 2014, the Workforce Alliance staff ed the LWIB Finance Committee, requested action on an item: 1. Financing of IT Network Upgrade On September 17, 2014 the WA LWIB Executive Committee reviewed and approved an IT infrastructure upgrade for the Workforce Alliance. The Executive Committee authorized the Finance Committee to review financing options for the purchase. The exact final costs are still being calculated, at this time WA has received an offer to finance the equipment and licenses at two percent interest for a term of three years through CISCO (the hardware and some of the licenses vendor). The amount to be financed would be approximately $203,000 and quarterly payments would be $17, or $5, monthly. The three year lease period coincides with the three year licensing terms of the software. The September 17th Executive Committee agenda item was attached to the for the Finance Committee to reference. Unanimous approval was received from the LWIB Finance Committee to authorize the President and Chief Executive Officer to enter into a leasing agreement for the equipment and licensing portion of the IT Update. Motion Adopted. Attendance Committee Members Kathy Jewett, Kaman Composites (Finance Chair) Rod Blackburn, WB Construction (LWIB Chair) Brad Mears, KMU NOTE: All staff handouts referenced in these minutes are maintained in the master meeting file at the Workforce Alliance office and are available upon request.

3 LWIB Finance Committee Item #3 March 12, 2015 Submitted By: Chad Pettera Item PY14 Budget Update Background Expenditures are final through January The LWIB Budget has an 11% surplus and WA Inc. has 30% surplus for an overall surplus of 19%. Overall WA is expecting to carry over funds into PY14 depending on the transition to WIOA. Through the end of March the LWIB has spent $805,866 or 27% of the WIA Budget on direct client service payments. WA Inc has spent $980,324 or 66% of its budget on direct client services. Overall WA has spent $1,786,190 or 41% of its entire budget on direct client services. Over all the budget is on track, but in a later item staff is requesting to transfer funds from the Dislocated Worker Program to the Adult Program. Dislocated Worker enrollments have become more of a challenge with the improvement in the economy. The state of Kansas currently has a waiver from the US Department of Labor to allow LWIBs to transfer up to 50% of funds between the Adult and Dislocated Worker Programs. Several of the line items that are impacted by the MOU cost sharing are showing a lower than planned percentage available, those will adjust as MOU payments are received. The supplies line item was mostly impacted by the opening and furnishing of the new El Dorado Workforce Center, but also the continued new breaking in of New Leaf has also lead to some unexpected expenditures. Staff is monitoring supply usage closely and has notified staff of the tightening of the supplies budget. Recommended Action Receive and file

4 Workforce Alliance Consolidated Budgets PY14 July 2014 June 2015 Updated 3/3/2015 Expenditures Through 1/31/2015 LWIB Jan YTD % Budget Jan YTD % Budget Jan YTD % Budget Category Budget Expenditures Expenditures Remaining Budget Expenditures Expenditures Remaining Budget Expenditures Expenditures Remaining Wages $ 2,394,484 $ 185,119 $ 1,268,930 47% $ 819,904 $ 43,861 $ 228,425 72% $ 3,214,388 $ 228,980 $ 1,497,355 53% Taxes $ 171,556 $ 14,283 $ 93,928 45% $ 132,608 $ 3,374 $ 16,517 88% $ 304,164 $ 17,657 $ 110,445 64% Benefits $ 348,351 $ (4,372) $ 141,888 59% $ 100,300 $ (954) $ 30,438 70% $ 448,651 $ (5,326) $ 172,326 62% Rent $ 204,304 $ 47,076 $ 189,692 7% $ 42,717 $ 2,251 $ 17,952 58% $ 247,021 $ 49,327 $ 207,644 16% Build Enh $ 5,000 $ $ 5,833 17% $ 155 $ $ 100% $ 5,155 $ $ 5,833 13% Security $ 14,256 $ 418 $ 15,500 9% $ 3,712 $ (33) $ 1,888 49% $ 17,968 $ 385 $ 17,388 3% Utilities $ 10,297 $ 1,053 $ (1,480) 114% $ 2,519 $ $ 100% $ 12,816 $ 1,053 $ (1,480) 112% Insurance $ 33,600 $ 10,465 $ 29,757 11% $ 11,675 $ 1,748 $ (2,066) 118% $ 45,275 $ 12,213 $ 27,691 39% Communications $ 48,066 $ 7,557 $ 34,293 29% $ 9,755 $ 366 $ 2,948 70% $ 57,821 $ 7,923 $ 37,241 36% Supplies $ 67,975 $ 35,589 $ 80,357 18% $ 15,103 $ 798 $ (3,746) 125% $ 83,078 $ 36,387 $ 76,611 8% Equipment $ 117,500 $ $ 14,254 88% $ $ $ #DIV/0! $ 117,500 $ $ 14,254 88% Copy $ 11,902 $ 167 $ 2,123 82% $ 5,545 $ 80 $ 80 99% $ 17,447 $ 247 $ 2,203 87% Postage $ 1,853 $ 13 $ 1,116 40% $ 701 $ $ % $ 2,554 $ 13 $ 1,273 50% Dues/Sub $ 13,000 $ 1,990 $ 5,459 58% $ 500 $ 250 $ 2, % $ 13,500 $ 2,240 $ 7,859 42% Conferences $ 27,000 $ 3,207 $ 23,464 13% $ 27,495 $ 1,930 $ 8,642 69% $ 54,495 $ 5,136 $ 32,106 41% Job Fairs $ 6,000 $ $ 7,642 27% $ $ $ 11,803 #DIV/0! $ 6,000 $ $ 19, % Meetings $ 21,060 $ 739 $ 4,811 77% $ 15,369 $ 1,284 $ 3,893 75% $ 36,429 $ 2,023 $ 8,704 76% Outreach $ 22,564 $ 1,182 $ 24,479 8% $ 22,774 $ 1,636 $ 3,362 85% $ 45,338 $ 2,817 $ 27,841 39% Transition $ 54 $ (79) $ $ $ (25) #DIV/0! Staff Development $ 43,600 $ 60 $ 7,218 83% $ 1,390 $ 200 $ % $ 44,990 $ 260 $ 7,586 83% Travel $ 31,650 $ 2,411 $ 19,195 39% $ 14,947 $ 285 $ 1,564 90% $ 46,597 $ 2,696 $ 20,758 55% Contract Services $ 395,825 $ 29,921 $ 195,674 51% $ 152,339 $ 8,457 $ 72,565 52% $ 548,164 $ 38,378 $ 268,239 51% Misc $ $ $ $ 25,000 $ $ 7,701 $ 25,000 $ $ 7,701 Depreciation Expense $ $ $ $ $ $ 6,736 $ $ $ 6,736 Interest Expense $ $ $ $ $ $ 3,281 $ $ $ 3,281 OJT Training $ 145,000 $ 3,130 $ 82,113 43% $ 581,501 $ 6,514 $ 154,743 73% $ 726,501 $ 9,644 $ 236,856 67% Incentives $ 6,000 $ 675 $ 5,575 7% $ $ $ 1,796 $ 6,000 $ 675 $ 7,371 23% Education & Training $ 1,899,420 $ 90,715 $ 604,194 68% $ 2,967,114 $ 91,617 $ 764,953 74% $ 4,866,534 $ 182,332 $ 1,369,147 72% Supportive Services $ 200,000 $ 7,267 $ 113,984 43% $ 344,271 $ 2,338 $ 58,832 83% $ 544,271 $ 9,605 $ 172,817 68% Total $ 6,240,263 $ 438,665 $ 2,970,052 52% $ 5,297,394 $ 166,002 $ 1,395,152 74% $ 11,537,657 $ 604,667 $ 4,365,205 62% WA INC Consolidated

5 Workforce Alliance of South Central Kansas Financial Overview Report Date 3/3/2015 Activities Date 7/1/2014 1/31/2015 Amount Prior Year Current Month Total Current Year Balance Future Unobligated Funding Program Date Authorized Authorized Expenditures Expenditures Expenditures Balance Remaining % Obligations Funds Workforce Investment Act Local Formula(*) & Discretionary Awards( # ) WIA Formula Admin* PY13 7/2013 6/2015 $ 120,669 $ 42, $ 78,372 $ (0) 0% $ (0) WIA Formula Admin* FY14 10/2013 6/2015 $ 226,401 $ 60, $ 23,134 $ 140,267 $ 25,747 11% $ 12,302 $ 13,445 WIA Formula Admin* PY14 7/2014 6/2016 $ 118,402 $ $ $ $ 118, % $ $ 118,402 WIA Formula Admin* FY15 10/2014 6/2016 $ 234,705 $ $ $ 234, % $ $ 234,705 Adult* FY14 10/2013 6/2015 $ 978,911 $ 277, $ 701,014 $ 0 0% $ 0 Adult* PY14 7/2014 6/2016 $ 69,521 $ 69,521 $ 0% $ Adult* FY15 10/2014 6/2016 $ 930,684 $ 183,717 $ 382,251 $ 548,433 59% $ 755,457 $ (207,024) Youth* PY14 4/2014 6/2016 $ 1,065,623 $ 79,256 $ 695,001 $ 370,622 35% $ 445,536 $ (74,914) DW* FY14 10/2013 6/2014 $ 1,058,707 $ 742,805 $ 315,902 $ (0) 0% $ (0) DW* PY14 7/2014 6/2016 $ 195,186 $ 85,686 $ 146,094 $ 49,092 25% $ 49,092 $ DW* FY15 10/2014 6/2016 $ 1,181,660 $ $ $ 1,181, % $ 202,470 $ 979,190 Rapid Response # FY14 10/ /2015 $ 70,000 $ $ 2,484 $ 16,233 $ 53,767 77% $ 3,149 $ 50,618 Senior Program # PY13 7/2013 9/2014 $ 784,157 $ 645, $ 138,645 $ 0 0% $ 0 Senior Admin # PY13 7/2013 9/2014 $ 49,525 $ 48, $ $ 1,232 $ (0) 0% $ (0) Senior Program # PY14 7/2014 6/2015 $ 794,084 $ 61,440 $ 265,192 $ 528,892 67% $ 271,818 $ 257,074 Senior Admin # PY14 7/2014 6/2015 $ 51,696 $ 2,948 $ 20,328 $ 31,368 61% $ $ 31,368 Workforce Investment Act Local Formula Awards $ 3,744,916 $ 1,817,191 $ 438,665 $ 2,970,052 $ 2,582,427 69% $ 1,468,006 $ 1,114,422 State of Kansas Grant Awards KHPOP PY13 10/ /2014 $ 810,494 $ 369,577 $ 175,790 $ 265,127 33% $ 265,127 KHPOP PY14 10/ /2015 $ 633,731 $ $ 40,381 $ 112,540 $ 521,191 82% $ 253,500 $ 267,691 HPOG KHPOP IMPACT 1/2013 9/2015 $ 151,772 $ 12,611 $ 634 $ 5,064 $ 134,096 88% $ $ 134,096 Kansas H 1B 11/ /2015 $ 850,000 $ 382,101 $ 7,017 $ 157,040 $ 310,859 37% $ 65,959 $ 244,900 State of Kansas Grant Awards $ 2,445,997 $ 764,290 $ 48,031 $ 450,435 $ 1,231,273 50% $ 319,460 $ 911,813 Workforce Alliance Inc. Direct Funding KEEP 11/ /2015 $ 4,888,425 $ 2,307,512 $ 51,845 $ 652,669 $ 1,928,244 39% $ 1,276,477 $ 651,767 KEEP Admin 11/ /2015 $ 111,575 $ 40,455 $ 2,352 $ 30,985 $ 40,135 36% $ $ 40,135 PACES/SIF 7/2013 6/2014 $ 92,447 $ $ 11,638 $ 75,139 $ 17,308 19% $ $ 17,308 REAP 1/1/ /31/2015 $ 228,000 $ 14,409 $ 14,409 $ 213,591 94% $ $ 213,591 CAP PY13 1/2014 9/2014 $ 202,000 $ 52,526 $ $ 51,153 $ 98,321 49% $ $ 98,321 CAP PY14 11/ /2015 $ 160,674 0 $ 10,709 $ 17,674 $ 143,000 89% $ $ 143,000 OWNE 1/ /2016 $ 185, $ 25,787 $ 54,106 $ 116,136 63% $ 116,136 Other $ 1,230 $ 48,583 Workforce Alliance Inc. Direct Funding $ 5,868,121 $ 2,415,252 $ 117,971 $ 944,718 $ 2,556,735 $ 1,276,477 $ 1,280,258 Total $ 12,059,033 $ 4,996,733 $ 604,667 $ 4,365,205 $ 6,370,434 53% $ 3,063,942 $ 3,306,492

6 LWIB Finance Committee Item #4 March 12, 2015 Submitted By: Chad Pettera Item Adult/Dislocated Worker Budget Transfer Background The State of Kansas currently has a waiver from the US Department of Labor to allow LWIBs to transfer up to 50% of funds between the Adult and Dislocated Worker Programs. Over the past year Dislocated Worker enrollments have become more of a challenge with the improvement in the economy, all at the same time Adult enrollments of individuals seeking to benefit from training have continued to increase. Staff is requesting to transfer $677,099 or 40% of Dislocated Worker Funds to the Adult Program to better align the program enrollments with the budgets. In January we had 964 Adults actively enrolled and 484 Dislocated Workers. Attached is a worksheet showing the transfer of $677,099 between the program budgets. Recommended Action Approve Budget Transfer

7 Adult and Dislocated Worker Proposed 40% Transfer from Dislocated Worker to Adult 0.4 Adult YTD Budget % of Budget Budget Manual New New % of DW YTD Budget % of Budget Budget Manual New New % of Category Budget Expendintures Balance Remaining Reallocation Adjustments Budget Budget Remaining Budget Remaining Budget Expendintures Balance Remaining Reallocation Adjustments Budget Budget Remaining dget Remaini Wages $ 707,218 $ 551,116 $ 156,102 22% $ 313,065 $ 1,020,283 $ 469,167 46% $ 782,662 $ 263,013 $ 519,649 66% $ (313,065) $ 469,597 $ 206,584 44% Taxes $ 49,505 $ 41,262 $ 8,243 17% $ 21,914 $ 71,419 $ 30,157 42% $ 54,786 $ 19,764 $ 35,022 64% $ (21,914) $ 32,872 $ 13,108 40% Benefits $ 106,082 $ 48,497 $ 57,585 54% $ 46,960 $ 153,042 $ 104,544 68% $ 117,399 $ 26,799 $ 90,600 77% $ (46,960) $ 70,439 $ 43,641 62% Rent $ 41,603 $ 64,668 $ (23,065) -55% $ 23,660 $ 65,263 $ 595 1% $ 59,151 $ 46,990 $ 12,161 21% $ (23,660) $ 35,491 $ (11,499) -32% Build Enh $ 1,700 $ 3,168 $ (1,468) -86% $ 800 $ 1,500 $ 4,000 $ % $ 2,000 $ 1,155 $ % $ (800) $ 1,200 $ 45 4% Security $ 2,903 $ 4,263 $ (1,360) -47% $ 1,651 $ 4,554 $ 291 6% $ 4,127 $ 3,619 $ % $ (1,651) $ 4,500 $ 6,976 $ 3,358 48% Utilities $ 2,097 $ (850) $ 2, % $ 1,192 $ 3,289 $ 4, % $ 2,981 $ (623) $ 3, % $ (1,192) $ 1,789 $ 2, % Insurance $ 1,700 $ 4,572 $ (2,872) -169% $ 800 $ 5,200 $ 7,700 $ 3,128 41% $ 2,000 $ 2,807 $ (807) -40% $ (800) $ 3,500 $ 4,700 $ 1,893 40% Communications $ 9,510 $ 12,717 $ (3,207) -34% $ 5,409 $ 14,919 $ 2,202 15% $ 13,523 $ 7,523 $ 6,000 44% $ (5,409) $ 8,114 $ 591 7% Supplies $ 13,171 $ 37,629 $ (24,458) -186% $ 5,588 $ 45,000 $ 63,759 $ 26,129 41% $ 13,969 $ 21,894 $ (7,925) -57% $ (5,588) $ 20,000 $ 28,381 $ 6,488 23% Equipment $ 28,055 $ 7,387 $ 20,668 74% $ 12,738 $ 40,793 $ 33,406 82% $ 31,845 $ 3,851 $ 27,994 88% $ (12,738) $ 19,107 $ 15,256 80% Copy $ 2,870 $ 1,096 $ 1,774 62% $ 1,182 $ 4,052 $ 2,956 73% $ 2,955 $ 441 $ 2,514 85% $ (1,182) $ 1,773 $ 1,332 75% Postage $ 306 $ 333 $ (27) -9% $ 154 $ 460 $ % $ 385 $ 247 $ % $ (154) $ 400 $ 631 $ % Dues/Sub $ 3,590 $ 1,317 $ 2,273 63% $ 1,708 $ 5,298 $ 3,981 75% $ 4,270 $ 803 $ 3,467 81% $ (1,708) $ 2,562 $ 1,759 69% Conferences $ 4,780 $ 3,296 $ 1,484 31% $ 2,192 $ 6,972 $ 3,676 53% $ 5,480 $ 1,414 $ 4,066 74% $ (2,192) $ 3,288 $ 1,874 57% Job Fairs $ 2,700 $ 4,338 $ (1,638) -61% $ 1,320 $ 5,000 $ 9,020 $ 4,682 52% $ 3,300 $ 1,633 $ 1,667 51% $ (1,320) $ 15,000 $ 16,980 $ 15,347 90% Meetings $ 2,775 $ 1,146 $ 1,629 59% $ 1,230 $ 4,005 $ 2,859 71% $ 3,075 $ 557 $ 2,518 82% $ (1,230) $ 1,845 $ 1,288 70% Outreach $ 3,095 $ 1,835 $ 1,260 41% $ 1,358 $ 4,453 $ 2,618 59% $ 3,395 $ 858 $ 2,537 75% $ (1,358) $ 2,037 $ 1,179 58% Transition $ 12,450 $ 3,613 $ 8,837 71% $ - $ 12,450 $ 8,837 71% $ 10 $ (10) #DIV/0! $ - $ - $ (10) #DIV/0! Staff Development $ - $ 29 $ (29) #DIV/0! $ 5,544 $ 5,544 $ 5,515 99% $ 13,860 $ 1,436 $ 12,424 90% $ (5,544) $ 8,316 $ 6,880 83% Travel $ 7,995 $ 8,440 $ (445) -6% $ 3,354 $ 11,349 $ 2,909 26% $ 8,385 $ 4,008 $ 4,377 52% $ (3,354) $ 5,031 $ 1,023 20% Contract Services $ 27,575 $ 56,171 $ (28,596) -104% $ 11,842 $ 54,000 $ 93,417 $ 37,246 40% $ 29,605 $ 31,509 $ (1,904) -6% $ (11,842) $ 35,000 $ 52,763 $ 21,254 40% OJT Training $ 43,500 $ 74,721 $ (31,221) -72% $ 40,600 $ 84,100 $ 9,379 11% $ 101,500 $ 7,392 $ 94,108 93% $ (40,600) $ 60,900 $ 53,508 88% Education & Training $ 542,418 $ 149,758 $ 392,660 72% $ 138,838 $ (110,700) $ 570,556 $ 420,797 74% $ 347,094 $ 12,044 $ 335,050 97% $ (138,838) $ (78,400) $ 129,856 $ 117,812 91% Supportive Services $ 85,000 $ 72,261 $ 12,739 15% $ 34,000 $ 119,000 $ 46,739 39% $ 85,000 $ 2,854 $ 82,146 97% $ (34,000) $ 51,000 $ 48,146 94% Total $ 1,702,598 $ 1,152,785 $ 549,813 32% $ 677,099 $ - $ 2,379,697 $ 1,226,912 52% $ 1,692,747 $ 461,996 $ 1,230,751 73% $ (677,099) $ - $ 1,015,648 $ 553,652 55%

8 LWIB Finance Committee Item #5 March 12, 2015 Submitted By: Chad Pettera Item PY13 Audit Report Background The audit report for PY13 is attached. Staff reports that the audit is clean with no findings or recommendations. Recommended Action Receive and File

9 Workforce Alliance of South Central Kansas, Inc. Wichita, Kansas Financial Statements and Supplementary Information Year Ended June 30, 2014

10 Workforce Alliance of South Central Kansas, Inc. Financial Statements and Supplementary Information Year Ended June 30, 2014 Table of Contents Independent Auditor s Report... 1 Financial Statements Statement of Financial Position... 3 Statement of Activities... 4 Statement of Functional Expenses... 5 Statement of Cash Flows... 6 Notes to Financial Statements... 7 Supplementary Information Schedule of Expenditures of Federal Awards Independent Auditor s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Independent Auditor s Report on Compliance for Each Major Federal Program and on Internal Control Over Compliance Schedule of Findings and Questioned Costs... 20

11 Independent Auditor s Report Board of Directors Workforce Alliance of South Central Kansas, Inc. Wichita, Kansas Report on Financial Statements We have audited the accompanying financial statements of Workforce Alliance of South Central Kansas, Inc. (a nonprofit organization), which comprise the statement of financial position as of June 30, 2014, and the related statements of activities, functional expenses and cash flows for the year then ended, and the related notes to the financial statements. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States; this includes 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. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States 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. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements 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 entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. 1

12 Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Workforce Alliance of South Central Kansas, Inc. as of June 30, 2014, and the changes in their net assets and their cash flows for the year then ended in accordance with accounting principles generally accepted in the United States. Other Matters Supplementary Information Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole. The accompanying schedule of expenditures of federal awards as required by U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, is presented for purposes of additional analysis, and is not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States. In our opinion, the information is fairly stated, in all material respects, in relation to the 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 February 13, 2015, on our consideration of Workforce Alliance of South Central Kansas, Inc. s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Workforce Alliance of South Central Kansas, Inc. s internal control over financial reporting and compliance. Wipfli LLP February 13, 2015 Madison, Wisconsin 2

13 Workforce Alliance of South Central Kansas, Inc. Statement of Financial Position Year Ended June 30, 2014 Assets Current assets: Cash $ 290,841 Cash held for others 171,007 Grants receivable 190,077 Related-party receivable 54,845 Prepaid expenses 33,267 Total current assets 740,037 Property and equipment: Equipment 287,095 Accumulated depreciation ( 217,148) Property and equipment, net 69,947 TOTAL ASSETS $ 809,984 Liabilities and Net Assets Current liabilities: Accounts payable $ 182,749 Accrued payroll and related expenses 103,719 Compensated absences and related expenses 103,580 Flexible spending payable 4,964 Funds held for others 171,007 Capital lease, current portion 8,429 Total current liabilities 574,448 Capital lease, non-current portion 43,886 Total liabilities 618,334 Net assets: Unrestricted 191,650 TOTAL LIABILITIES AND NET ASSETS $ 809,984 See accompanying notes to financial statements. 3

14 Workforce Alliance of South Central Kansas, Inc. Statement of Activities Year Ended June 30, 2014 Revenue: Grant revenue $ 7,388,359 Program income 43,354 Miscellaneous income 4 Total revenue 7,431,717 Expenses: Program activities: Workforce Investment Act (WIA) 3,792,241 Senior Community Services Employment Program 645,512 Health Profession Opportunity Project 592,650 H-1B Grant 259,349 KEEP H-1B Grant 1,455,521 Community Services Block Grant 59,024 State Energy Sector Partnership and Training Project ( 6,056) National Emergency Grant ( 366) Other Non-Federal Programs 287,615 Total program activities 7,085,490 Management and general 377,916 Total expenses 7,463,406 Change in net assets ( 31,689) Net assets - Beginning of the Year 223,339 Net assets - End of the Year $ 191,650 See accompanying notes to financial statements. 4

15 Workforce Alliance of South Central Kansas, Inc. Statement of Functional Expenses Year Ended June 30, 2014 Management Program & General Total Expenses: Wages $ 2,365,611 $ 126,182 $ 2,491,793 Payroll taxes 198,842 10, ,920 Benefits 318,741 32, ,898 Rent 221,123 1, ,283 Building enhancement 1, ,898 Security 46, ,089 Utilities 28, ,077 Insurance 10,153 19,334 29,487 Communications 73,993 1,926 75,919 Office supplies 159,462 8, ,963 Office equipment / furniture 10,814 1,863 12,677 Copier lease 37, ,030 Postage 1, ,588 Dues and subscriptions 4,026 5,421 9,447 Conference 23,098 17,131 40,229 Job fairs 5, ,006 Meetings 18,944 7,245 26,189 Outreach 26,702 10,443 37,145 Staff development 28, ,676 Travel 34,015 2,963 36,978 Contract services 260, , ,271 Transition expense 61,272 10,393 71,665 Miscellaneous 3, ,257 Depreciation expense 30, ,912 Interest expense 1, ,977 Incumbent worker training 4, ,004 Incentives 11, ,700 Education and training 2,843, ,843,954 Supportive services 252, ,374 Total expenses $ 7,085,490 $ 377,916 $ 7,463,406 See accompanying notes to financial statements. 5

16 Workforce Alliance of South Central Kansas, Inc. Statement of Cash Flows Year Ended June 30, 2014 Increase (decrease) in cash: Cash flows from operating activities: Change in net assets ($ 31,689) Adjustments to reconcile change in net assets to net cash provided by operating activities: Depreciation 30,912 Changes in operating assets and liabilities: Grants receivable 500,728 Related-party receivable ( 46,095) Prepaid expenses 45 Accounts payable ( 302,874) Accrued payroll and related expenses ( 7,948) Compensated absences and related expenses ( 4,458) Other liabilities 317 Net cash provided by operating activities 138,938 Cash flows used in financing activities Principal payment on note payable ( 28,298) Principal payment on capital lease obligation ( 2,279) Net cash used in financing activities ( 30,577) Change in cash 108,361 Cash - Beginning of the Year 182,480 Cash - End of the Year $ 290,841 Schedule of other cash activity Cash paid for interest expense $ 1,977 Noncash investing and financing activities: Asset acquisition through capital lease $ 54,594 See accompanying notes to financial statements. 6

17 Workforce Alliance of South Central Kansas, Inc. Notes to Financial Statements Note 1 Summary of Significant Accounting Policies Nature of Operations Workforce Alliance of South Central Kansas, Inc. (the Organization ) is a tax-exempt, nonprofit organization under Section 501(c)(3) of the Internal Revenue Code. The Organization incorporated in 2001 following the passage of the Workforce Investment Act (WIA) of As the Local Workforce Investment Board (LWIB) for Butler, Cowley, Harper, Kingman, Sedgwick, and Sumner counties in the state of Kansas, the primary duties of the Organization are to manage federal job training funds, operate One-Stop Workforce Centers and coordinate the public workforce system in South Central Kansas. The Organization's services are funded primarily through the Workforce Investment Act. A significant reduction in the level of this support could have an adverse effect on the Organization's programs and services. Approximately 98% of grant funding is direct from the United States of Labor or federal pass-through funds received from the State of Kansas Department of Commerce. Basis of Presentation All financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States. Use of Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Cash Held for Others The Organization manages activities associated with the Regional Economic Area Partnership (REAP) program. The cash is held separately in a cash account with a corresponding liability as ownership of the funds rests with the REAP program. Related-party Receivable Related-party receivable represents costs shared with partner agencies for office spaces and other services that were requested for reimbursement. No estimate is made for doubtful receivables, as the Organization believes they are fully collectible. 7

18 Workforce Alliance of South Central Kansas, Inc. Notes to Financial Statements Note 1 Summary of Significant Accounting Policies (Continued) Property and Equipment Equipment for which title passes to the Organization is capitalized and stated at cost. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations for the period. The cost of maintenance and repairs is charged to operations as incurred. Depreciation is provided by straight-line method over the estimated useful lives of the assets. The useful lives for computer equipment, software licenses, and office equipment are 3, 10, and 5 years, respectively. Property and equipment purchased with grant funds are owned by the Organization while used in the program for which it was purchased or in other future authorized programs. However, the various funding sources have a reversionary interest in the equipment purchased with grant funds. Its disposition, as well as the ownership of any proceeds therefrom, is subject to funding source regulations. Classification of Net Assets Net assets and revenue, expenses, gains, and losses are classified based on the existence or absence of donor-imposed restrictions. Accordingly, net assets of the Organization and changes therein are classified and reported as follows: Unrestricted Net Assets - Net assets that are not subject to donor-imposed stipulations. Temporarily Restricted Net Assets - Net assets subject to donor-imposed stipulations that may or may not be met, either by actions of the Organization and/or the passage of time. When a restriction expires, temporarily restricted net assets are transferred to unrestricted net assets and reported in the statement of activities as net assets released from restrictions. As of June 30, 2014, the Organization does not have any temporarily restricted net assets. Permanently Restricted Net Assets - Net assets subject to donor-imposed stipulations that they be maintained permanently by the Organization. Generally, the donors of these assets permit the Organization to use all or part of the income earned on any related investments for general or specific purposes. As of June 30, 2014, the Organization does not have any permanently restricted net assets. Revenue Recognition Contributions that are restricted by the donor are reported as increases in unrestricted net assets if the restrictions expire in the fiscal year in which the contributions are recognized. All other contributions are reported as increases in temporarily or permanently restricted net assets depending on the nature of the restrictions. When a restriction expires, temporarily restricted net assets are reclassified as unrestricted net assets and reported in the statement of activities as contributions released from restriction. 8

19 Workforce Alliance of South Central Kansas, Inc. Notes to Financial Statements Note 1 Summary of Significant Accounting Policies (Continued) Revenue Recognition (Continued) Conditional promises to give are recognized only when the conditions on which they depend are substantially met and the promises become unconditional. Support funded by grants is recognized as the Organization performs the contracted services or incurs outlays eligible for reimbursement under the grant agreements. The program activities and the related outlays are subject to audit and acceptance by the granting agency. Consequently, such audit may mandate adjustment. Grants are either recorded as contributions or exchange transactions based on criteria contained in the grant award. A. Grant Awards That Are Contributions Grants that qualify as contributions are recorded as invoiced to the funding sources. Revenue is recognized in the accounting period when the related allowable expenses are incurred. Amounts received in excess of expenses are reflected as grant funds received in advance. B. Grant Awards That Are Exchange Transactions Exchange transactions reimburse based on a predetermined rate for services performed. The revenue is recognized in the period the service is performed. Income Taxes The Organization is a nonprofit organization under Section 501(c)(3) of the Internal Revenue Code and is exempt from Federal and Kansas income taxes. The Organization is required to assess whether it is more likely than not that a tax position will be sustained upon examination on the technical merits of the position assuming the taxing authority has full knowledge of all information. If the tax position does not meet the more likely than not recognition threshold, the benefit of that position is not recognized in the financial statements. The Organization has determined there are no amounts to record as assets or liabilities related to uncertain tax positions. Federal returns for the fiscal years ended June 30, 2011, and beyond remain subject to examination by the Internal Revenue Service. Cost Allocation Joint costs are allocated to benefiting programs using various allocation methods depending on the type of joint cost being allocated. Joint costs are those costs incurred for the common benefit of all of the Organization s programs, which cannot be readily identified with a final cost objective. 9

20 Workforce Alliance of South Central Kansas, Inc. Notes to Financial Statements Note 1 Summary of Significant Accounting Policies (Continued) Subsequent Events Subsequent events have been evaluated through February 13, 2015, which is the date the financial statements were available to be issued. Note 2 Cash and Cash Held for Others The Organization maintains its cash in bank deposits that, at times, may exceed federally insured limits. The Organization has not experienced any losses in such accounts. The Organization believes it is not exposed to any significant credit risk on cash and cash equivalents. The following table represents the detail cash balances, as of June 30, 2014: Bank account: WFA WIA cash $ 111,744 WFA Non-federal cash 179,097 Total bank accounts 290,841 Funds held for others- WFA - REAP 171,007 Total $ 461,848 Note 3 Grants Receivable Grants receivable represents reimbursable expenditures incurred and accrued for WIA program and other grant funds. Management does not believe that estimate for doubtful receivables would be necessary since such funds are awarded by the federal, state, and other local governments and are expected to be fully reimbursed. As of June 30, 2014, the books of the Organization report the following outstanding receivables: Grants receivable from Kansas Department of Commerce - Federal $ 24,854 Grants receivable from U.S. Department of Labor 47,629 Grants receivable from Regional Economic Area Partnership 11,326 Others 106,268 Total $ 190,077 10

21 Workforce Alliance of South Central Kansas, Inc. Notes to Financial Statements Note 4 Equipment During the current year, the Organization had capital purchases in the amount of $54,594. For the year ended June 30, 2014, depreciation expense was $30,912. Whenever events or changes in circumstances occur that indicate the carrying amount of long-lived assets may not be recoverable, management reviews the assets for possible impairment. Management estimated there is no material impairment at June 30, During the year ended June 30, 2014, the Organization leased office equipment from CISCO Capital. Total amount financed is $54,594 which will require 36 quarterly payments of $15,379. The net book value of grant-funded property and equipment as of June 30, 2014, is $69,947. This amount includes the net book value for capital lease equipment in the amount of $51,864. Note 5 Operating Leases The Organization leases corporate office space in Wichita under two operating leases. One lease is through June 2015 and the other through June Both of these lease agreements are contingent upon the Organization receiving WIA funds. The Organization can terminate either office space lease for material breach, lack of funding, or for convenience. If the Organization terminates the corporate office space leases for convenience, the fee to take such action is as follows. Prior to May 1, 2016 $800,000 May 1, 2016 to April 30, 2017 $600,000 May 1, 2017 to April 30, 2018 $300,000 May 1, 2018 to April 30, 2019 $150,000 The Organization subleases portions of its corporate office space to other unrelated entities under various agreements which will in expire June 2015, and require annual rentals of $127,551. Rent expense for the corporate office space net of sublease reimbursement for the year ended June 30, 2014, was $168,646. The Organization also leases three facilities housing One-Stop Workforce Centers and office space under operating lease agreements expiring during FY2014. These agreements are also contingent upon the Organization receiving WIA funds. Rent expense for the three One-Stop Workforce Centers net of sublease reimbursement for the year ended June 30, 2014, was $53,

22 Workforce Alliance of South Central Kansas, Inc. Notes to Financial Statements Note 5 Operating Leases (Continued) Future minimum lease payments on leases with noncancelable terms beyond one year are as follows: 2015 $ $400, , , , and thereafter 180,400 Total $ 1,230,083 Note 6 Capital Lease Obligations The Organization leases office equipment from Lease Finance Partners. The lease is for 60 months and requires monthly payments of $1,234, due May The minimum future lease payments under the capital lease as of June 30, 2014, for the next five years and in the aggregate are: 2015 $ 14, , , , ,341 Total minimum lease payments 71,577 Less amount representing interest (19,262) Present value of net minimum lease payments $ 52,315 The net book value of assets recorded under the capital lease as of June 30, 2014, was $54,594. Interest rate on the capitalized lease is %. Interest paid on the capital lease for the year ended June 30, 2014, was $851. Note 7 Retirement Plan The Organization has a 403(b) plan covering substantially all employees. The Organization matches 100% of employee contributions up to a maximum of 3% of compensation once employed for six months. The Organization contributed $43,073, to this Plan for the year ended June 30,

23 Workforce Alliance of South Central Kansas, Inc. Notes to Financial Statements Note 8 Related Parties For the year ended June 30, 2014, the organization entered into a sublease agreement with the Kansas Department of Commerce (KDOC). KDOC reimbursed the Organization sublease costs in the amount of $54,051. In addition, as of June 30, 2014, the KDOC owed the Organization for its share of facility costs in the amount of $67,761. KDOC provided funding in the amount of $9,887,804, for WIA and other programs. Note 9 Revenue Recognition Reimbursements from federal funds are recognized as revenue when the related expenditures are incurred and reported. Funding from other sources is recognized as revenue when earned. Description of Activities Total Workforce Investment Act (WIA) $4,052,453 Senior Community Services Employment Program 693,805 Health Profession Opportunity Project 592,650 H-1B Grant 259,349 KEEP H-1B Grant 1,478,906 Community Services Block Grant 59,024 State Energy Sector Partnership and Training Project ( 6,056) National Emergency Grant 1,116 REAP 160,092 OWNE 90,000 Others 50,378 Total $7,431,717 Note 10 Grant Award Commitments At June 30, 2014, the Organization had received future funding commitments under various grants of approximately $6,000,000. These commitments are not recognized in the accompanying financial statements as revenue and receivables as they are conditional awards. 13

24 Supplementary Information

25 Workforce Alliance of South Central Kansas, Inc. Schedule A-1 Schedule of Expenditures of Federal Awards Year Ended June 30, 2014 CFDA Grant Program or Federal Number Number Program Name Grantor Agency Program Period Award Amount Expenditures ASSISTANCE PROGRAMS AS IDENTIFIED IN THE CATALOG OF FEDERAL DOMESTIC ASSISTANCE Department of Labor SCSEP-004 Senior Community Service Employment Kansas Dept. of Commerce 07/01/13-06/30/14 $ 833,682 $ 693, A-004 WIA Adult Kansas Dept. of Commerce 07/01/13-06/30/15 29,837 29, FY13-A-004 WIA Adult Kansas Dept. of Commerce 10/01/12-06/30/14 978, , FY14-A-004 WIA Adult Kansas Dept. of Commerce 10/01/13-06/30/15 1,087, ,428 Subtotal , Y-004 WIA Youth Kansas Dept. of Commerce 04/01/12-06/30/14 1,174, , Y-004 WIA Youth Kansas Dept. of Commerce 04/01/13-06/30/15 1,206,693 1,128, PY14-Y-004 WIA Youth Kansas Dept. of Commerce 04/01/14-06/30/16 1,184, ,210 Subtotal ,695, DEI-001 WIA Dislocated Worker - DEI Kansas Dept. of Commerce 01/10/10-03/31/14 230,866 44, DW-004 WIA Dislocated Worker Kansas Dept. of Commerce 07/01/13-06/30/15 123, , RR-004 WIA Dislocated Worker Kansas Dept. of Commerce 10/01/13-09/30/14 67,350 29, FY12RRAA-004 WIA Dislocated Worker Kansas Dept. of Commerce 11/27/12-06/30/14 410,000 ( 3,492) FY13-DW-004 WIA Dislocated Worker Kansas Dept. of Commerce 10/01/12-06/30/14 1,238, , FY14-DW-004 WIA Dislocated Worker Kansas Dept. of Commerce 10/01/13-06/30/15 1,176, ,661 Subtotal ,428,745 WIA Cluster Total (17.258, , and ) 4,052, H1B-004 H-1B Job Training Kansas Dept. of Commerce 11/14/14-11/30/15 850, , KEEP (DOL) H-1B Job Training U.S. Dept. of Labor 11/14/11-11/30/15 5,000,000 1,478,906 Subtotal ,738, ARRA-Worker Training & Placement Kansas Dept. of Commerce 03/08/12-06/30/13 575,674 ( 6,056) See Independent Auditor's Report. 14

26 Workforce Alliance of South Central Kansas, Inc. Schedule A-2 Schedule of Expenditures of Federal Awards (Continued) Year Ended June 30, 2014 CFDA Grant Program or Federal Number Number Program Name Grantor Agency Program Period Award Amount Expenditures ASSISTANCE PROGRAMS AS IDENTIFIED IN THE CATALOG OF FEDERAL DOMESTIC ASSISTANCE Department of Labor (continued) NEG (DOL) WIA National Emergency Grants Kansas Dept. of Commerce 07/01/11-06/30/13 2,994,763 1,116 Department of Health and Human Services KHPOP-004 ACA Health Profession Opportunity Grants Kansas Dept. of Commerce 09/30/12-12/31/13 628, , KHPOP-004 ACA Health Profession Opportunity Grants Kansas Dept. of Commerce 09/30/13-12/31/14 810, , IMPACT STUDY ACA Health Profession Opportunity Grants Kansas Dept. of Commerce 01/01/13-09/30/14 151,772 8,127 Total , Community Services Block Grant Kansas Dept. of Commerce 01/01/14-09/30/14 59,024 59,024 TOTAL FEDERAL PROGRAMS $ 7,131,247 Notes to the Schedule of Expenditures of Federal Awards Note 1 - Basis of Presentation The accompanying schedule of expenditures of federal awards (the Schedule ) includes the federal grant activity of Workforce Alliance of South Central Kansas, Inc. under programs of the federal government for the year ended June 30, The information in this schedule is presented in accordance with the requirements of the Office of Management and Budget (OMB) Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Because the schedule presents only a selected portion of the operations of Workforce Alliance of South Central Kansas, Inc., it is not intended to and does not present the financial position, changes in net assets or cash flows of Workforce Alliance of South Central Kansas, Inc. Note 2 - Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in OMB Circular A-122, Cost Principles for Non-Profit Organizations, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available. See Independent Auditor's Report. 15

27 Independent Auditor s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Board of Directors Workforce Alliance of South Central Kansas, Inc. Wichita, Kansas We have audited, in accordance with the auditing standards generally accepted in the United States 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 Workforce Alliance of South Central Kansas, Inc. (a nonprofit organization), which comprise the statement of financial position as of June 30, 2014, and the related statements of activities, functional expenses and cash flows for the year then ended, and the related notes to the financial statements, and have issued our report thereon dated February 13, Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered Workforce Alliance of South Central Kansas, Inc.'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 opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of Workforce Alliance of South Central Kansas, Inc.'s internal control. Accordingly, we do not express an opinion on the effectiveness of Workforce Alliance of South Central Kansas, Inc. 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 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 the internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies or material weaknesses. 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. 16

28 Compliance and Other Matters As part of obtaining reasonable assurance about whether Workforce Alliance of South Central Kansas, Inc.'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 and in considering Workforce Alliance of South Central Kansas, Inc. s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Wipfli LLP February 13, 2015 Madison, Wisconsin 17

29 Independent Auditor s Report on Compliance for Each Major Federal Program and on Internal Control Over Compliance Board of Directors Workforce Alliance of South Central Kansas, Inc. Wichita, Kansas Report on Compliance for Each Major Federal Program We have audited Workforce Alliance of South Central Kansas, Inc.'s compliance with the types of compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, Workforce Alliance of South Central Kansas, Inc.'s major federal programs are identified in the summary of auditor s results section of the accompanying schedule of findings and questioned costs. Management s Responsibility Management of Workforce Alliance of South Central Kansas, Inc. is responsible for compliance with the requirements of laws, regulations, contracts, and grants applicable to its federal programs. Auditor s Responsibility Our responsibility is to express an opinion on compliance for each of Workforce Alliance of South Central Kansas, Inc.'s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States, Local Governments, and Non- Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about Workforce Alliance of South Central Kansas, Inc.'s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide legal determination Workforce Alliance of South Central Kansas, Inc.'s compliance with those requirements. 18