FY22 financial report print.indd

Virginia Tech Financial Report 2021-2022 Management’s Discussion and Analysis (Unaudited)

Virginia Polytechnic Institute and State University, popularly known as Virginia Tech, is a comprehensive, land-grant university located in Blacks burg, Virginia. The university offers 280 graduate, undergraduate, and professional degree programs through its nine academic colleges: Agricul ture and Life Sciences; Architecture, Arts, and Design; Engineering; Liber al Arts and Human Sciences; Natural Resources and Environment; Pamplin College of Business; Science; the Virginia-Maryland College of Veterinary Medicine; and the Virginia Tech Carilion School of Medicine. Virginia Tech has evolved into a position of increasing national promi nence since its founding in 1872, consistently ranking among the nation’s top universities for undergraduate and graduate programs. The university’s research program was ranked 49th among the top research institutions in the United States by the National Science Foundation in its latest survey measuring annual research expenditures. The university is an agency of the Commonwealth of Virginia, and there fore included as a component unit in the Commonwealth of Virginia’s An nual Comprehensive Financial Report . The 14 members of the Virginia Tech Board of Visitors govern university operations. Members of the board are appointed by the Governor of Virginia. Overview This unaudited Management’s Discussion and Analysis (MD&A) is required supplemental information under the Governmental Accounting Standards Board’s (GASB) reporting model. It is designed to assist readers in under standing the accompanying financial statements and provide an overall view of the university’s financial activities based on currently known facts, decisions, and conditions. This discussion includes an analysis of the university’s financial condition and results of operations for the fiscal year ended June 30, 2022. Comparative numbers are included for the fiscal year ended June 30, 2021 and have been restated for the implementation of GASB Statement 87, Leases . Since this presentation includes highly sum marized data, it should be read in conjunction with the accompanying basic

In accordance with Section 2100 of the GASB codification, the university’s nine affiliated corporations were evaluated on the nature and significance of their relationship to the university. The Virginia Tech Foundation Inc. (VTF or ‘the foundation’) was determined to be a component unit and is presented in a separate column on the university’s financial statements. VTF serves the university by generating significant funding from private sources and aggressively managing its assets to provide supplemental funding to the university. The foundation is not part of this MD&A, but detail regarding its financial activities can be found in Note 26 of the Notes to Financial Statements . Transactions between the university and this com ponent unit have not been eliminated in this year’s financial statements. The following GASB statements of standards became effective and were implemented in fiscal year 2022: Statement 87, Leases; Statement 89, Accounting for Interest Cost Incurred Before the End of a Construction Period ; Statement 92, Omnibus 2020 (paragraphs 8-9); Statement 93, Replacement of Interbank Offered Rates (paragraphs 11b, 13, and 14); Statement 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans; and Statement 98, The Annual Comprehensive Financial Report . The university was not affected by the implementation of statements 92, 93, 97, or 98. In June 2017, GASB issued Statement 87, Leases . The objective of this statement is to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by gov ernments. The statement requires recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the agreement. The university adopted Statement 87 in fiscal year 2022 with an implementation date of July 1, 2020. This re sulted in the recognition of right-of-use assets (net) of $126.8 million, lease liabilities of $121.6 million, lease receivables of $0.9 million, and deferred inflows of $0.9 million for fiscal year 2022. Prior year amounts have all been restated for comparative purposes.

financial statements, including notes and other supplementary information. The university’s management is responsi ble for all of the financial information presented, including this discussion and analysis. The university’s financial statements have been prepared in accordance with GASB Statement 35, Basic Financial Statements—and Management’s Discussion and Analysis—for Public Colleges and Universities , as amended by GASB State ments 37, 38, and 63. The three required financial statements are the Statement of Net Position (balance sheet), the Statement of Revenues, Expenses, and Changes in Net Position (operating statement), and the Statement of Cash Flows . These statements are summarized and analyzed in the following sections. Combining sched ules included in Optional Supplementary Information indicate how major fund groups were aggregated to arrive at the single column totals presented on the Statement of Net Position and the Statement of Revenues, Expenses, and Changes in Net Position .

Burruss Hall displays a banner celebrating Virgina Tech’s 150th year. Photo by Luke Hayes for Virginia Tech.


Made with FlippingBook flipbook maker