University of Oregon 2019 Annual Financial Report
Notes to the Financial Statements
For the Year Ended June 30, 2019 (dollars in thousands)
In January 2017, GASB issued Statement No. 84,
Fiduciary Activities. This Statement improves guidance
regarding the identification of fiduciary activities of all
state and local governments, and for accounting and
financial reporting of those activities. The Statement is
effective for the fiscal year ending June 30, 2020, and
will apply to custodial funds held by the UO primarily
for student groups.
In June 2017, GASB issued Statement No. 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 governments. The Statement is effective for the fiscal
year ended June 30, 2021.
In August 2018, GASB issued Statement No. 90,
Majority Equity Interests. The primary objectives of
this Statement are to improve the consistency and
comparability of reporting a government's majority
equity interest in a legally separate organization
and to improve the relevance of financial statement
information for certain component units. The Statement
is effective for the fiscal year ending June 30, 2020.
In May 2019, GASB issued Statement No. 91, Conduit
Debt Obligations. The primary objectives of this
Statement are to provide a single method of reporting
conduit debt obligations by issuers and eliminate
diversity in practice associated with (1) commitments
extended by issuers, (2) arrangements associated
with conduit debt obligations, and (3) related note
disclosures. The Statement is effective for the fiscal year
ending June 30, 2021.
C. Basis of Accounting
For financial reporting purposes, the UO is considered
a special-purpose government engaged only in
business-type activities. Accordingly, the UO financial
statements are presented using the economic resources
measurement focus and the accrual basis of accounting.
Under the accrual basis, revenues are recognized when
earned and expenses are recorded when incurred.
D. Cash and Cash Equivalents
Cash and cash equivalents include highly liquid
investments with original maturities of three months
or less. Cash and cash equivalents consist of cash and
investments held by the UO and cash held in the Oregon
Short Term Fund (OSTF).
Cash and cash equivalents restricted for capital
construction and agency funds are classified as
noncurrent assets in the SNP.
E. Investments
Investments are reported at fair value as determined by
market prices. Unrealized gains or losses on investments
are reported as investment activity in the SRE.
Investments are classified as noncurrent assets in the SNP.
Various inputs are used in determining the fair value of
investments. These inputs to valuation techniques are
categorized into a fair value hierarchy consisting of three
broad levels for financial statement purposes as follows:
Level 1 - unadjusted price quotations in active
markets/exchanges for identical assets or liabilities,
that each fund has the ability to access.
-
Level 2 other observable inputs including, but not
limited to, quoted prices for similar assets or liabilities
in markets that are active, quoted prices for identical
or similar assets or liabilities in markets that are
not active, inputs other than quoted prices that are
observable for the assets or liabilities (such as interest
rates, yield curves, volatilities, loss severities, credit
risks, and default rates) or other market-corroborated
inputs.
Level 3 - unobservable inputs based on the best
information available in the circumstances, to the
extent observable inputs are not available (including
each fund's own assumptions used in determining the
fair value of investments).
The hierarchy gives the highest priority to unadjusted
quoted prices in active markets for identical assets
or liabilities (Level 1 measurements) and the
lowest priority to unobservable inputs (Level 3
measurements). Accordingly, the degree of judgment
exercised in determining fair value is greatest for
instruments categorized in Level 3. The inputs used
to measure fair value may fall into different levels of
the fair value hierarchy. In such cases, for disclosure
purposes, the fair value hierarchy classification is
determined based on the lowest level input that is
significant to the fair value measurement in its entirety.
The categorization of a value determined for
investments is based on the pricing transparency of the
investments and is not necessarily an indication of the
risks associated with investing in those securities.
The UO categorizes its fair value measurements within
the fair value hierarchy established by GAAP. The
UO has recorded its investments at fair value, and
primarily uses the market approach to valuing each
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