Mr. Milt Russos Ms. Tia Smith Ms. Carla Sodek Mr. Cleve Warren Ms. Tania Yount Ronnie Hargraves- Harbeson, Fletcher & Bateh, LLP

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1 Florida State College Foundation Board of Directors Finance, Investment, & Audit Committee Meeting Minutes September 10, 2014 Administrative Offices, Room 403A, Noon PRESENT: Mr. Jeff Edwards, Chair Dr. H. Wade Barnes, Jr. Dr. Cynthia Bioteau Mr. Carl Cannon Mr. Robert Cook Mr. Donald Zell ABSENT: Mr. Jim Stevenson Mr. Scott Verlander Mr. Wayne Young STAFF PRESENT: GUESTS PRESENT: CALL TO ORDER: Ms. Lisa Maldonado Mr. Milt Russos Ms. Tia Smith Ms. Carla Sodek Mr. Cleve Warren Ms. Tania Yount Ronnie Hargraves- Harbeson, Fletcher & Bateh, LLP Jeff Edwards called the meeting to order and welcomed those in attendance. MINUTES: Jeff Edwards asked the Committee if there were any comments or recommended revisions to the minutes of the June 11, 2014 Finance, Audit, and Investment Committee meeting. MOTION: (Barnes- Zell) The motion was made to approve the minutes of the June 11, 2014 Finance, Audit, and Investment Committee meeting, as recommended. Jeff Edwards asked if there were any questions or comments by the Board, and there were none. Motion carried unanimously.

2 Page 2 PRESENTATION OF FY2014 AUDIT: Ronnie Hargraves from Harbeson, Fletcher & Bateh briefly reviewed the Foundation audit with the Finance Committee. Discussions were made with regards to the following: Adding the wording of the foundation on page 5 under cash revenue mid-way down. The new sentence would read: The College elected not to bill the Foundation for certain in-kind staff and support expenditures of the foundation of $645,212 in 2014 and $669,273 in Final determination of Artist Series and whether it should be self-sufficient, remain under the Foundation or act as their own 501c3. This will be determined based upon the recommendation of the Artist Series Taskforce. Academic Health Center monies raised and resolve of the remaining funds. Management of Prosperity Funds Scholarship. Dr. Bioteau recommended we continue to manage the funds and distribute to the sister colleges on an annual basis and collaborate with the other colleges to market the opportunity. The Foundation will provide all background information to the Finance Committee with this regard. Another Board member suggested dissolving the fund equally to the other entities to prevent negative p/r and provide proof that the funds are being used toward the intended purpose-which is for student scholarships. Recommendation of adding the wording may be subject to future match with regards to the State matching Program on page 7. Ronnie confirmed that the auditors did not find any instances of the Foundation Financials to be non-compliant with state standards. Cleve Warren recommended the Foundation consider an operational audit possibly every other year to concentrate on operational controls. Chair Edwards suggested obtaining a proposal for an operational audit. Based on the management letter, Ronnie suggested correcting the method in which the Prosperity Funds were being accounted for and added this information to the management letter in the first paragraph on page 2 of the management letter.

3 Page 3 Jeff also asked that the Full board receive a copy of the audit including corrections made prior to the full Board meeting. FINANCIALS Jeff Edwards, Committee Chair, provided an overview of the Financial Summary for the period ending June 30, Revenue Source FY2014 FY2013 Variance Narrative Available Operations $410,000 $410, % Approved Operating Budget for Available 5% Spending Current Endowed Current Restricted Current Unrestricted $1,704,928 $1,179, % 5% spending available for FY2014 from endowed/ quasi endowed funds. $911,352 $207, % Funds raised in FY2014 for endowment funds. to large estate gift received in $1,233,950 $1,083, % Funds raised in FY2014 for non-endowed funds. to a grant received in $0 $0 0.00% Currently not raising unrestricted donations.

4 Page 4 Events $95,297 $89, % FY 2014 Events. to new event - My Favorite Cookbook. See below for breakdown. Alumni Relations In-Kind from FSCJ $2,270 $10, % Decrease due to cancelling of Jaguar game. $645,212 $669, % Total of Inkind Support from Florida State College at Jacksonville. Totals $5,003,009 $3,649, % Event Revenue Expenses Net Motorcycle Ride for $4,870 $736 $4,134 Wounded Vets My Favorite Cookbook $25,626 $15,881 $9,742 Norm Will Golf $30,716 $10,157 $20,559 Tournament Blue Wave Golf Tournament $34,085 $13,470 $20,615 Expenses Category FY2014 FY2013 Variance Narrative Scholarships $1,442,144 $1,471, % Scholarships awarded to students. Programs $834,140 $615, % to large grant received in

5 Page 5 Facilities $0 $0 0.00% No current facility projects. Faculty Chairs $39,000 $4, % to retro payments from Margaret Zell Endowed Chair fund in Operations $267,022 $263, % Daily operations including special event costs. Travel, Supplies, Professional Development Salaries and Benefits Return of Prior Restricted Contributions $46,652 $54, % Decrease due to fewer number of conferences attended by staff in $598,561 $614, % Decrease due to fewer staff in $947,000 $ % Return of Academic Health Center Contribution Totals $4,174,519 $3,024, % Income /Investments Category FY2014 FY2013 Variance Narrative

6 Page 6 Cash Contributions $1,748,310 $1,284, % to large estate gift received in Other Revenue Investment Income 5% Spending $494,559 $281, % Monies raised for programs and projects, includes grants. to large grant received in $6,288,494 $4,175, % Earned from Investments. to stronger stock market. $1,704,928 $1,179, % Monies available for spending from endowed funds, per Foundation's investment policy. Totals $10,236,291 $6,920, % Net Assets FY2014 FY2013 Variance $46,467,136 $42,032, % There was discussion with regards to the following:

7 Page 7 Dr. Bioteau expressed eventually she would like all monies to stream through the Foundation. The Finance Committee also mentioned reviewing the process of the Endowed Chairs. MOTION: (Barnes- Cook) The motion was made to tentatively accept the expenses and revenues of the Foundation. Jeff Edwards asked if there were any questions or comments by the Board, and there were none. Motion carried unanimously. ARTIST SERIES SUBCOMMITTEE Jeff gave a brief update to the Finance Committee about the Artist Series meetings that have been conducted thus far to determine the future status of the Artist Series. The following were some of the options of the recommendation: A. Does it stay under the auspices of the Foundation? B. Is it self-sustaining as a 501c3 on its own (or)? C. Is there another alternative? Jeff included yearly P & L statements from the Artist Series to the Finance Committee for their review. There was discussion with regards to the Following: The difference between the Quasi endowed and the program endowed funds. The suggestion was made to not only review the history behind how the funds were distributed to each account but to go forward placing the funds in the correct area to support existing conditions. MOTION: (Barnes- Zell) The motion was made to approve the acknowledgement to reimburse the college $445,342 for the loss of Artist Series dollars. (See page 2 of Artist Series Tab showing total net assets as of June 30, 2014.)

8 Page 8 The suggestion was made to take the funds from the following: $117,553 which is the 5% spending from program endowment for FY2014 and the difference from the agency fund in the amount of $327,789. Jeff Edwards asked if there were any questions or comments by the Board, and there were none. Motion carried unanimously. It also was recommended that at some time in the future funds 3 and 4 be combined and monies be invested. Jeff also asked that the recommendation of the above be an agenda item at the next Full Board meeting. DISCUSSION ABOUT FUNDS Lisa informed the Committee that the Foundation staff would begin outlining the endowed and endowed accounts to make them all uniform. Lisa briefly discussed target allocations with the Finance Committee and informed the Committee that in order to have enough cash reserves on hand to pay the college back and still be sustainable, that some of the investment accounts would need to be liquidated. Committee members recommended having a meeting with Common Fund representative, Tom Van Zant prior to Full Board meeting to clarify the amount invested with Common Fund as well as to discuss capital calls fund investments. NEXT MEETING: The next Committee meeting is scheduled for Wednesday, December 3, 2014, at the College s Administrative Offices, Room 403A, 11:30 lunch and Committee meeting at noon. ADJOURNMENT: APPROVAL OF MINUTES: There being no further business, Chair Edwards, declared the meeting adjourned at 1:30p.m. Jeff Edwards, Chair