RVCC 2019 NECHE Self-Study

Operating Revenues and Expenses
Operating revenues consist of tuition and fees; federal, state and other grants and contracts; sales
and services of education activities; and auxiliary enterprises revenues. Operating expenses
include instruction, public service, academic support, student services, institutional support,
operations and maintenance, student aid, auxiliary enterprises, and residential life and depreciation
and amortization. All other revenues and expenses of the System are reported as other or
nonoperating revenues and expenses, including state general appropriations, noncapital gifts,
investment income, interest expense and capital additions and deductions. Capital items represent
all other changes in long-term plant and endowment net assets. Revenues are recognized when
earned and expenses are recognized when incurred. Restricted grant revenue is recognized only
to the extent expended for expenditure driven grants or, in the case of fixed-price contracts, when
the contract terms are met or completed.
Income Taxes
The Internal Revenue Service has determined that CCSNH is a wholly-owned instrumentality of
the State of New Hampshire and, as such, is generally exempt from federal income tax. The
Foundation is exempt from income taxes because it is a 501(c)(3) organization.
If an exempt organization regularly carries on a trade or business not substantially related to its
exempt purpose, except that it provides funds to carry out that purpose, the organization is subject
to tax on its income from that unrelated trade or business. The System has evaluated the positions
taken on its business activities and has concluded no unrelated business income tax exists at June
30, 2018 and 2017.
Use of Estimates in Financial Statement Preparation
The preparation of financial statements in conformity with U.S. generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements. Estimates also affect the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates
231 | P a g e