NEVADA VIRTUAL ACADEMY
FINANCIAL STATEMENTS
JUNE 30, 20
23
NEVADA VIRTUAL ACADEMY
FINANCIAL STATEMENTS
JUNE 30, 2023
Table of Contents
Independent Auditor’s Report ....................................................................................................................
1-3
Management’s Discu
ssion and Analysis ....................................................................................................... 4-8
Basic Financial Statements:
Government-wide financial statements:
Statement of net position ....................................................................................................................... 9
Statement of activities .......................................................................................................................... 10
Fund financial statements:
Balance sheet – governmental funds .................................................................................................... 11
Reconciliation of the balance sheet of governmental funds to the statement of net position .............. 12
Statement of revenues, expenditures and changes in fund balances of governmental funds ............... 13
Reconciliation of the statement of revenues, expenditures and changes in fund balances
of governmental funds to the statement of activities ..................................................................... 14
Notes to the Financial Statements ............................................................................................................. 15-26
Required Supplementary Information:
Budget comparison schedule (unaudited) .................................................................................................. 27
Supplemental pension information ............................................................................................................. 28
Supplemental contribution schedule ........................................................................................................... 29
Other Supplementary Information:
Financial statement audit results summary ................................................................................................ 30
Schedule of financial performance .............................................................................................................. 31
NEVADA VIRTUAL ACADEMY
FINANCIAL STATEMENTS
JUNE 30, 2023
Table of Contents (Continued)
Compliance Section:
Independent Auditor’s Report on Internal Control over Financial Reporting
and on Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards .............................................. 32-33
Independent Auditor’s Report on Compliance for Each Major Program and on
Internal Control over Compliance Required by the Uniform Guidance .................................. 34-35
Schedule of expenditures of federal awards .................................................................................... 36-37
Schedule of findings and questioned costs ...................................................................................... 38-39
Corrective action plan ....................................................................................................................... 40-41
Independent Auditor’s Report
To the School Board of
Nevada Virtual Academy
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statements of the governmental activities and each major fund of Nevada Virtual
Academy (School)
as of and for the year ended June 30, 2023, and the related notes to the financial statements, which
collectively comprise the School’s basic financial statements as listed in the table of contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position
of the governmental activities and each major fund of the School, as of June 30, 2023, and the respective changes in financial
position for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the
standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the
United States.
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of
the Financial Statements section of our report. We are required to be independent of the School and to meet our other ethical
responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting
principles generally accepted in the United States of America, and for 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.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in
the aggregate, that raise substantial doubt about the School’s ability to continue as a going concern for twelve months beyond
the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is
a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance
with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement
when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would
influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and
design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis,
evidence regarding the amounts and disclosures in the financial statements.
Obtain an understanding of internal control relevant to the audit 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 School’s
internal control. Accordingly, no such opinion is expressed.
Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates
made by management, as well as evaluate the overall presentation of the financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial
doubt about the School’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and
analysis and budgetary comparison information on pages 4–8 and 27 be presented to supplement the basic financial statements.
Such information is the responsibility of management and, although not a part of the basic financial statements, is required by
the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the
basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited
procedures to the required supplementary information in accordance with auditing standards generally accepted in the United
States of America, which consisted of inquiries of management about the methods of preparing the information and comparing
the information for consistency with management’s responses to our inquiries, the basic financial statements, and other
knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any
assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion
or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the
School’s basic financial statements. The accompanying combining and individual nonmajor fund financial statements and
schedule of expenditures of federal awards, as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform
Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, are presented for purposes of
additional analysis and are not a required part of the basic 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 basic
financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial
statements and certain additional procedures, including comparing and reconciling such information directly to the underlying
accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and
other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our
opinion, the combining and individual nonmajor fund financial statements and the schedule of expenditures of federal awards
are fairly stated, in all material respects, in relation to the basic financial statements as a whole.
Other Information
Management is responsible for the other information included in the annual report. The other information comprises the
introductory and statistical sections but does not include the basic financial statements and our auditor’s report thereon. Our
opinion on the basic financial statements does not cover the other information, and we do not express an opinion or any form of
assurance thereon.
In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider
whether a material inconsistency exists between the other information and the basic financial statements, or the other
information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected
material misstatement of the other information exists, we are required to describe it in our report.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated October 18, 2023, on our
consideration of the School’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 solely 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 effectiveness of the School’s 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 the School’s
internal control over financial reporting and compliance.
Las Vegas, Nevada
October 18, 2023
MANAGEMENT’S DISCUSSION AND ANALYSIS
4
NEVADA VIRTUAL ACADEMY
MANAGEMENT’S DISCUSSION AND ANALYSIS
JUNE 30, 2023
The following discussion and analysis of Nevada Virtual Academy provides an overview of the School’s financial
activities for the year ended June 30, 2023. As management of Nevada Virtual Academy (the School), we
encourage readers to consider the information presented here in conjunction with the financial statements and notes.
This annual report consists of a series of financial statements. The Statement of Net Position and the Statement of
Activities provide information about the activities of the School as a whole and present a longer-term view of the
School’s finances. Fund financial statements tell how these services were financed in the short-term, as well as
what remains for future spending. Fund financial statements report the School’s operations in more detail than the
government-wide statements.
Financial Highlights
The School’s net position shows a deficit of $4,846,705. Assets consist primarily of cash of $4,561,168, and
receivables of $465,835, prepaid expenses of $156,331, intangible lease assets of $1,112,235, and other assets
$71,350. Total revenue was $18,269,961, which includes $15,172,251 from the Pupil-Centered Funding Plan
(PCFP) for expenditures incurred during the fiscal year.
Overview of the Financial Statements
The School’s basic financial statements are comprised of three components: government-wide financial statements,
fund financial statements, and the accompanying notes to the financial statements.
Government - Wide Financial Statements:
The government-wide financial statements are designed to provide readers with a broad overview of the School’s
finances, in a manner similar to a private-sector business.
The statement of net position presents information on all of the School’s assets and liabilities, with the difference
between the two reported as net position. Over time, increases or decreases in net position may serve as useful
indicators of whether the financial position of the School is improving or deteriorating.
The statement of activities presents information showing how the School’s net position changed during the most
recent fiscal year. Changes in net position are reported as soon as the underlying event giving rise to the change
occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement
for some items that will only result in cash flows in future fiscal periods.
Fund Financial Statements:
A fund is established to account for a specific activity or purpose. The School only has governmental funds.
Governmental funds are used to account for essentially the same functions reported as governmental activities in
the government-wide financial statements. However, unlike the government-wide financial statements,
governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as
balances of spendable resources available at the end of the fiscal year. Such information may be useful in
evaluating a government’s near-term financing requirements. Because the governmental fund financial statements
focus on near-term spendable resources, and the governmental activities on the government-wide financial
statements have a longer-term focus, a reconciliation of the differences between the two is provided following the
fund financial statement’s balance sheet and statement of revenues, expenditures, and changes in fund balances,
respectively.
5
NEVADA VIRTUAL ACADEMY
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
JUNE 30, 2023
Overview of the Financial Statements (continued)
Notes to the Basic Financial Statements:
The notes to the basic financial statements provide additional information that is essential to a full understanding of
the information provided in the government-wide and fund financial statements and should be read with the
financial statements.
The School as a Whole
One important question asked about the School’s finances is: “Is the School better or worse off as a result of the
year’s activities?” The information in the government-wide financial statements helps answer this question. These
statements include all assets and liabilities using the accrual basis of accounting, which is the basis of accounting
used by most private-sector companies.
The change in net position (the difference between total assets and total liabilities) over time is one indicator of
whether the School’s financial health is improving or deteriorating. However, consideration should be given to
other non-financial factors in making an assessment of the School’s health, such as changes in enrollment, changes
in the State’s funding of educational costs and changes in the economy to assess the overall health of the School.
The School’s net position was as follows:
2023 2022 Change Percentage
Current assets 5,183,334$ 5,421,801$ (238,467)$ -4%
Non current assets 1,183,585 1,730,576 (546,991) -32%
Total assets 6,366,919 7,152,377 (785,458) -11%
Deferred outflows of resources 6,304,710 5,213,929 1,090,781 21%
Current liabilities 2,276,173 4,183,698 (1,907,525) -46%
Long-term liabilities 14,026,451 7,653,384 6,373,067 83%
Total liabilities 16,302,624 11,837,082 4,465,542 38%
Deferred inflows of resources 1,200,285 7,229,564 (6,029,279) -83%
Net position:
Invested in capital assets, net - - - 0%
Unrestricted (4,831,280) (6,700,340) 1,869,060 28%
Net position (4,831,280)$ (6,700,340)$ 1,869,060$ 28%
The School’s financial position has changed since the fiscal year ended June 30, 2023. Current assets decreased by
5% due primarily decrease in receivables due to the timing of payments from PCFP revenue. Non current assets
decreased significantly primarily due to lease payments. Current liabilities decreased by 46% primarily due to the
payments made to the management company that were owed. Long-term liabilities increased by 83% primarily due
to GASB 68 and the changes in the pension liability. Overall net position increased primarily due to a decrease in
expenses due to the management company.
6
NEVADA VIRTUAL ACADEMY
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
JUNE 30, 2023
The School as a Whole – Continued
The School’s revenues were as follows:
2023 2022 Change Percentage
Revenue
State sources 15,549,983$ 15,966,974$ (416,991)$ -3%
Federal sources 2,623,718 2,383,106 240,612 10%
Other sources 96,260 22,338 73,922 331%
Total revenue 18,269,961$ 18,372,418$ (102,457)$ -1%
The State revenue sources are up by 1% primarily due to a increase in basic funding per student according to the
new PCFP. Federal Sources have decreased from the prior year primarily due to the spend down of Covid related
funding from the Education Stabilization Fund.
The School’s expenditures were as follows:
2023 2022 Change Percentage
Regular instruction 12,454,755$ 11,539,066$ 915,689$ 8%
Special instruction 2,162,187 1,722,381 439,806 26%
Instructional support 456,764 462,349 (5,585) -1%
General administration 42,480 2,211,841 (2,169,361) -98%
Central services 602,416 543,543 58,873 11%
Operations and maintenance 98,032 233,169 (135,137) -58%
Amortization of intangible lease assets 533,164 44,844 488,320 1089%
Unallocated depreciation - 21,696 (21,696) -100%
Debt Service 51,103 4,970 46,133 928%
Total expenses 16,400,901$ 16,783,859$ (382,958)$ -2%
Overall instruction (Regular and Special combined) increased year over year due primarily to increases in salaries,
benefits, and bonuses paid to teachers. General administration expenses decreased by 98% primarily due to a
reduction in K12 Management fees. Central services increased in relation to a write off of bad debt related to
restricted federal source income receivables deemed uncollectible. Operation and maintenance decreased due to the
decrease in costs related to moving locations. Amortization of intangible lease assets increased because the current
year represents a full year of amortization related to lease assets. Unallocated depreciation is $0 in the current year
because all assets are fully depreciated. Debt service increased of the implementation of the new lease standards
and the recognition of interest expense related to the leases.
7
NEVADA VIRTUAL ACADEMY
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
JUNE 30, 2023
Government – Fund Financial Analysis
The following analysis has been prepared comparing the results for the fiscal year ending June 30, 2023 to the final
school budget:
Nevada Virtual Academy
Budget Comparison Schedule (Unaudited)
Modified Accrual
For the Fiscal Year Ended June 30, 2023
Variance
Favorable /
Budget Actual (Unfavorable)
REVENUE
Local revenue sources -$ 96,260$ 96,260$
State revenue sources 15,733,512 15,549,983 (183,529)
Federal revenue sources 1,877,953 2,623,718 745,765
Total revenue 17,611,465 18,269,961 658,496
EXPENDITURES
Program expenditures
Regular programs 12,016,896 11,837,735 179,161
Special programs 1,181,836 2,976,388 (1,794,552)
Total programs expenditures 13,198,732 14,814,123 (1,615,391)
Debt service - 503,335 (503,335)
Undistributed support services 4,322,151 1,199,692 3,122,459
Total expenditures 17,520,883 16,517,150 1,003,733
Excess (deficiency) of revenue over
expenditures 90,582 1,752,811 1,662,229
FUND BALANCE, beginning 1,775,511 1,775,511 -
FUND BALANCE, ending 1,866,093$ 3,528,322$ 1,662,229$
The total revenue variance is due to primarily the decrease in per-pupil funding per the new PCFP that was not
contemplated in the budget. Certain Education Stabilization Funds monies were used to supplant the loss in
funding and are included in federal revenue sources. Total expenditures decreased primarily to the decrease in K12
costs including student, management and technology costs offset by increases other casts, principally teachers’
salaries and benefits and bad debt expense related to restricted funds source income deemed uncollectible.
8
NEVADA VIRTUAL ACADEMY
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
JUNE 30, 2023
The Future of the School
The future of the middle school and high school at Nevada Virtual Academy remain strong. The school continues to
be in good standing with the State Public Charter School Authority (SPCSA) and both the middle and high school
programs remain 3-star schools. The School’s enrollment is generally stable with its increased cap. The school
earned seven out of eight possible points on the most recent SPCSA Organizational Framework, is committed to
operating within its financial resources, and is committed to continuous school improvement. The school is focused
on providing more opportunities for our students to enroll in CTE courses, continual improvement of our
graduation rate, and increased achievement on SBAC and ACT assessments.
Request for information
The financial report is designed to provide a general overview of the School’s finances for all those with an interest.
Questions concerning any of the information provided in this report or requests for additional financial information
should be addressed to the Nevada Virtual Academy at 8645 S. Eastern Ave., Suite 100, Las Vegas, NV 89123, and
telephone number (702) 407-1825.
BASIC FINANCIAL STATEMENTS
9
The accompanying notes are an integral part of these financial statements.
Nevada Virtual Academy
Statement of Net Position
June 30, 2023
ASSETS
Current assets
Cash 4,561,168$
Receivables 465,835
Prepaid expenses 156,331
Total current assets 5,183,334
Noncurrent assets
Intangible lease asset, net 1,112,235
Refundable deposits 71,350
Total noncurrent assets 1,183,585
Total assets 6,366,919
DEFERRED OUTFLOWS OF RESOURCES
Pension requirement 6,304,710
Total assets and deferred outflows of resources 12,671,629$
LIABILITIES
Current liabilities
Accounts payable 145,779$
Accrued expenses 1,118,812
Due to related part
y
453,818
Lease obligations, current 549,811
Deferred revenues 7,953
Total current liabilities 2,276,173
Noncurrent liabilities
Lease obligations, noncurrent 647,070
Net pension liabilit
y
13,379,381
Total noncurrent liabilities 14,026,451
Total liabilities 16,302,624
DEFERRED INFLOWS OF RESOURCES
Pension requirement 1,200,285
Total liabilities and deferred inflows of resources 17,502,909
NET POSITION
Unrestricted (4,831,280)
Total net position (4,831,280)$
10
The accompanying notes are an integral part of these financial statements.
Nevada Virtual Academy
Statement of Activities
For the Fiscal Year Ended June 30, 2023
Governmental
GOVERNMENTAL ACTIVITIES Activities
Instruction:
Regular instruction 12,454,755$
Special instruction 2,162,187
Total instruction 14,616,942
Support services:
Instruction 456,764
General administration 42,480
Central services 602,416
Operations and maintenance 98,032
Amortization of intangible lease assets 533,164
Total support services 1,732,856
Debt service:
Interest expense 51,103
Total expenditures 16,400,901
PROGRAM REVENUE
Operating grants
Special instruction 3,001,450
GENERAL REVENUE
Pupil centered funding progra
m
15,172,251
Other sources 96,260
Total general revenue 15,268,511
CHANGE IN NET POSITION 1,869,060
NET POSITION, beginning of yea
r
(6,700,340)
NET POSITION, end of yea
r
(4,831,280)$
11
The accompanying notes are an integral part of these financial statements.
Nevada Virtual Academy
Balance Sheet - Governmental Funds
June 30, 2023
General Fund
ASSETS
Cash 4,561,168$
Receivables 465,835
Prepaid expenses 156,331
Refundable deposits 71,350
Total assets 5,254,684$
LIABILITIES
Accounts payable 145,779$
Accrued expenses 1,118,812
Due to related party 453,818
Deferred revenues 7,953
Total liabilities 1,726,362
FUND BALANCES
Nonspendable:
Deposits 71,350
Unassigned 3,300,641
Total fund balances 3,528,322
Total liabilities and fund balances 5,254,684$
12
The accompanying notes are an integral part of these financial statements.
Nevada Virtual Academy
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Position
June 30, 2023
Total fund balances - governmental funds
3,528,322$
Amounts reported for governmental activities in the statement of net position
are different because:
Capital and intangible assets, net of related depreciation and amortization,
are not reported in the in the governmental funds financial statements because
they are not current financial resources, but they are reported in the statement
of net position.
Intangible lease assets not reported 1,690,597
Less accumulated amortization (578,362) 1,112,235
Capital assets not reported 597,731
Less accumulated depreciation (597,731) -
Long-term liabilities are not due and payable in the current period and,
therefore, are not reported in the governmental funds.
Lease obligations, current (549,811)
Lease obligations, noncurrent (647,070) (1,196,881)
Net pension liability and the related deferred inflows and outflows or
resources are not included in governmental fund financial statements.
Deferred outflows of resources - pension requirement 6,304,710
Deferred inflows of resources - pension requirement (1,200,285)
Net pension liability (13,379,381) (8,274,956)
Total net position - governmental activities
(4,831,280)$
13
The accompanying notes are an integral part of these financial statements.
Nevada Virtual Academy
Statement of Revenues, Expenditures, and Changes in Fund Balances -
Governmental Funds
For the Fiscal Year Ended June 30, 2023
Special Revenue
General Fund Fund Total
REVENUES
State sources 15,172,251$ 377,732$ 15,549,983$
Federal sources - 2,623,718 2,623,718
Other sources 96,260 - 96,260
Total revenues 15,268,511 3,001,450 18,269,961
EXPENDITURES
Programs:
Instruction 11,837,735 2,976,388 14,814,123
Total program expenditures 11,837,735 2,976,388 14,814,123
Support services:
Instructional support 369,938 86,826 456,764
General administration 39,374 3,106 42,480
Operations and maintenance 33,477 64,555 98,032
Central services 380,764 221,652 602,416
Total support services 823,553 376,139 1,199,692
Debt service:
Principal payments on lease financing 342,232 110,000 452,232
Interest expense 51,103 - 51,103
Total debt service 393,335 110,000 503,335
Total expenditures 13,054,623 3,462,527 16,517,150
Excess of revenue over (under) expenditures 2,213,888 (461,077) 1,752,811
OTHER FINANCING SOURCES (USES)
Transfers (461,077) 461,077 -
Net changes in fund balances 1,752,811 - 1,752,811
Fund Balances, beginning of year 1,775,511 - 1,775,511
Fund Balances, end of year 3,528,322$ -$ 3,528,322$
14
The accompanying notes are an integral part of these financial statements.
Nevada Virtual Academy
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances of Governmental Funds to the Statement of Activities
For the Fiscal Year Ended June 30, 2023
Net change in fund balances - governmental funds
1,752,811$
Amounts reported for governmental activities in the statement of activities are
different because:
The acquisition of capital assets are reported in the governmental funds as
expenditures. However, for governmental activities, those costs are shown in
the statement of net position and are allocated over their estimated useful lives
as annual depreciation expense in the statement of activities. This is the
amount that the current year's depreciation expense exceeded the capital asset
purchases in the current period.
Less current year amortization
(533,164)
Principal payments on notes payable or lease obligations are reported in the
government funds as expenditures. However, for government-wide activities,
those costs are shown in the statement of net position as a reduction of a liability.
Additionally, proceeds from long-term debt is recognized as revenue from
other funding sources.
Principal payments on lease obligations 452,232
Certain expenses reported in the statement of activities do not require or provide
current financial resources and, therefore, are not reported as revenues or
expenditures in governmental funds:
Change in pension requirements
197,181
Change in net position of governmental activities
1,869,060$
15
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2023
NOTE 1 – ORGANIZATION AND CHARTER
Nevada Virtual Academy (School) is a 501(c)(3) charter school established in 2007 under Nevada Revised Statue
386.500 and incorporated as a non-profit in 2019. The School’s mission is to provide students, grades 6-12, an
educational alternative to the public schools. Instruction is provided in the core courses of study including English,
Math, Science, History, Art, and Music. The School has chosen K12 Inc. (K12) as its sole curriculum provider.
K12 provides management and technology services as well as accounting, operations, and record keeping services
to the School.
Upon approval by the Nevada Department of Education to continue operations as a charter school, the School
entered into an agreement with the State Public Charter School Authority (Authority) as the School’s sponsor, for a
term of six (6) years beginning on July 1, 2013. In August 2020, the contract was renewed for another five years
ending in June 2024, with a beginning effective date of July 1, 2019.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the School have been prepared in accordance with accounting principles generally
accepted in the United States of America as applied to governmental units. The Governmental Accounting
Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and
financial reporting principles. The following is a summary of the more significant policies:
Reporting Entity
The accompanying financial statements include all of the activities that comprise the financial reporting entity of
the School. The School is governed by an elected Board of Trustees (Board). The Board is legally separate and
fiscally independent from other governing bodies; therefore, the School is a primary government and the School is
not reported as a component unit by any other government unit. The accounting policies of the School conform to
generally accepted accounting principles applicable to governmental entities. The Governmental Accounting
Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and
financial principles.
Basis of Presentation:Government-wide and Fund Financial Statements
The School’s basic financial statements consist of both government-wide financial statements and fund financial
statements. Accounting principles generally accepted in the United States of America require the School to apply
all applicable pronouncements of GASB. The school also follows guidance issued by the Financial Accounting
Standards Board (FASB) in the Accounting Standard Codification (ASC) to the extent that the pronouncements do
not conflict with pronouncements issued by GASB.
Government-wide Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement of activities) report
information on all of the nonfiduciary activities of the primary government. The statement of activities presents a
comparison between direct expenses and program revenue for each function of the School’s governmental
activities. Direct expenses are those that are clearly identifiable with a specific program or function. The School
does not charge indirect expenses to programs or functions. Program revenues include grants and contributions that
are restricted to meeting the operational or capital requirements of a particular program or function. Revenue that is
not classified as program revenue is presented as general revenue.
16
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Fund Financial Statements
The major governmental funds are reported as separate columns in the fund financial statements. This requires each
fund be treated as a separate accounting entity and that the operations of each fund are accounted for with a
separate set of self-balancing accounts that comprise its assets, liabilities, fund balance, revenue, and expenditures.
Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which
they are to be spent and the means by which spending activities are controlled.
Measurement Focus and Basis of Accounting
The government-wide financial statements are reported using the economic resources measurement focus and the
accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is
incurred, regardless of the timing of related cash flows. Grants and similar items are recognized as revenue as soon
as all eligibility requirements imposed by the provider have been met and the School has been notified that the
funds are available to be received.
Governmental fund financial statements are reported using the current financial resources measurement focus and
the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and
available. “Measurable” means that the amount of the transaction can be determined. “Available” means that the
amount is collectible within the current period or soon enough thereafter to pay liabilities incurred in the current
period. In general, expenditures are recorded when liabilities are incurred. The exception to this rule is for
payments of principal and interest on debt service or capital leases, which are recorded when payment is due.
All of the School’s funds are governmental funds. The School reports the following major governmental funds:
General Fund: The School’s general operating fund used to account for all financial resources and costs of
operations traditionally associated with governments, which are not required to be accounted for in other
funds.
Special Revenue Fund: These funds are used to account for the proceeds of special revenue sources that
are restricted or committed by law or administrative action to expenditure for specific purposes other than
debt service or capital projects. The special revenue fund accounts for the School’s special education
program transactions, relating to educational services provided to children with special needs as supported
by state and local sources.
Budgets and Budgetary Information
The School is required by the Nevada Department of Education (Department) to adopt a final budget no later than
June 8 of each year under NRS 388A.366, but is not required by the Department to augment the budget during the
year. Further, the School is not required under the statute to adopt a final budget or otherwise comply with any
provisions of Chapter 354 of the NRS. In essence, augmentation of the School’s budget is neither required nor
prohibited. Budgets submitted to the state include that of the primary government and each blended component
unit; therefore, no additional budget comparison schedules have been presented for other funds.
17
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Cash and Cash Equivalents
The School defines cash and cash equivalents as cash and short-term investments with an initial maturity of three
months or less. Investments are stated at fair value, and allocated to the special revenue fund based on the
expectation of using the eventual procedures for purposes appropriate within that fund, as applicable.
Receivables
Receivables include Distributive School Account and other grant balances due from state and federal sources. The
School considers the balance of receivables to be fully-collectible; accordingly, an allowance for uncollectible
accounts has not been recorded.
Prepaid Expenses
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid
expenses in both government-wide and fund financial statements. Prepaid expenses are equally offset by a fund
balance classification indicating they are “non-spendable”.
Capital Assets
Capital assets are defined by the School as assets with an initial individual cost exceeding $5,000 and an estimated
useful life in excess of one year. Such assets are recorded at historical cost or an estimated historical cost if
purchased or constructed. Donated capital assets are recorded at their estimated fair market value on the date of
donation. Costs of normal repair or maintenance that do not add value or materially extend asset life are not
capitalized. The useful life for leasehold improvements is determined based on the term of the underlying lease
agreement. Depreciation and amortization on all capital assets are provided on the straight-line basis over the
following estimated useful lives:
Capital Asset Type Years
Furniture and equipment 5
Accrued Salaries and Benefits
Employee compensation earned but not paid by June 30, 2023, has been accrued as liabilities and shown as
expenses for the current year.
Compensated Absences
The School maintains a Paid Time-Off (PTO) policy for eligible employees. The policy requires that accumulated
discretionary time off benefits earned during the year to be used before the end of the fiscal year; therefore, no
liability for compensated absences has been recorded.
18
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Net Position and Fund Balance
In government-wide financial statements, net position is classified into three components:
Invested in Capital Assets, Net of Related Debt: This is the component of net position that reports the
difference between the capital assets less both the accumulated depreciation and the outstanding balance of
debt, excluding unexpended proceeds, that is directly attributable to the acquisition, construction, or
improvement of those assets.
Restricted Net Position: This is the component of net position that reports the constraints placed on the use
of assets by constitutional provisions, enabling legislation, or because of constraints that are externally
imposed by creditors, grantors, contributors, or the laws and regulations of other governments.
Unrestricted Net Position: All other assets that do not meet the definition of “invested in capital assets, net
of related debt” or “restricted net position”.
In the fund financial statements, the classifications of fund balance represent amounts that are not subject to
appropriation or are legally segregated for a specific purpose, and are classified into five components:
Nonspendable fund balance: These items are legally or contractually required to be maintained intact and
are not in a spendable form, such as prepaid expenses.
Restricted fund balance: These amounts are restricted for use toward a specific purpose by constitutional
provisions, enabling legislation, or because of constraints that are externally imposed by creditors, grantors,
contributors, or the laws or regulations of other governments.
Committed fund balance: These amounts can only be used for specific purposes as set forth by the School
Board. The Board must take formal action, prior to the end of the reporting period, in order to establish an
ending fund balance commitment for any specific purpose. Formal Board action is also required to modify
or rescind an established commitment.
Assigned fund balance: Assignments are neither restrictions nor commitments, and represent the School’s
intent to use funds for a specific purpose. These assignments, however, are not legally binding and are
meant to reflect intended future use of the School’s ending fund balance. The School Board and
Management have the responsibility of assigning amounts of ending fund balance.
Unassigned fund balance: The residual classification for the General Fund that is available to spend.
19
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Net Position and Fund Balance (Continued)
When an expenditure is incurred, and both restricted and unrestricted resources are available, the portion of the
fund balance that was restricted for purposes shall be reduced first. If no restricted resources exist, then the
unrestricted fund balance shall be reduced. Furthermore, when an expenditure is incurred for purposes which
amounts of committed, assigned, or unassigned are considered to have been spent, and any of these unrestricted
fund balance classifications could be used, they are considered spent in the above order.
Defined Benefit Pension Plan
For purposes of measuring the net pension liability, deferred outflows of resources, deferred inflows of resources
and pension expense, information about the fiduciary net position of the Public Employees’ Retirement System of
Nevada (PERS) and additions to/deductions from PERS’s fiduciary net position have been determined on the same
basis as they are reported by PERS. For this purpose, benefit payments (including refunds of employee
contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported
at fair value.
Deferred Outflows and Inflows of Resources
In addition to assets, a separate section is reported for deferred outflows of resources. This separate financial
statement element, deferred outflows of resources, represents a consumption of net position that applies to a future
period and will not be recognized as an outflow of resources (expense/expenditure) until then. The changes in
proportion and differences between employer contributions and the proportionate share of contributions as well as
contributions made after the measurement period for pensions qualify for reporting in this category.
In addition to liabilities, a separate section is reported for deferred inflows of resources. This separate financial
statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future
period and will not be recognized as an inflow of resources (revenue) until that time. Differences between expected
and actual experience and between projected and actual investment earnings on pension plan investments qualify
for reporting in this category.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United
States of America requires management to make estimates, assumptions, and judgments that affect certain reported
amounts and disclosures. Accordingly, actual results could differ from those estimates.
20
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
New Accounting Pronouncements
Statement No. 100, Accounting Changes and Error Corrections, improves the clarity of the accounting and
financial reporting requirements for accounting changes and error corrections, which will result in greater
consistency in application in practice. More understandable, reliable, relevant, consistent and comparable
information will be provided to financial statement users for making decisions or assessing accountability.
Additionally, the display and note disclosure requirements will result in more consistent, decision useful,
understandable and comprehensive information for users about accounting changes and error corrections. This
statement is effective for the year ending June 30, 2024.
Statement No. 101, Compensated Absences, updates the recognition and measurement guidance for compensated
absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model
and by amending certain previously required disclosures. This statement is effective for the year ending June 30,
2025.
The School District is evaluating the impact the above pronouncements will have on its financial reporting.
NOTE 3 – CHANGE IN ACCOUNTING PRINCIPLE
During the year ended June 30, 2023 the School District adopted new accounting guidance, GASB Statement No.
96, Subscription-Based Information Technology Arrangements (SBITAs). Our opinions are not modified with
respect to this matter. The overall effect to the financial statements was not material.
NOTE 4 – CONCENTRATION OF CREDIT RISK
The School’s cash is categorized in three categories of credit risk:
Category 1: Insured or collateralized with securities held by entity or by its agent in the School’s name.
Category 2: Collateralized with securities held by the pledging financial institution’s trust department or
agent in the School’s name.
Category 3: Uncollateralized.
The School participates in a statewide collateral pool made available under applicable state law. The statewide
program is centralized and coordinated by the Office of the State Treasurer. Under the pool, participating financial
institutions are required to maintain collateral securities having a fair market value that is at least 102% of the
amount of the aggregate uninsured ledger balances of public money held by the depository. State and local agency
participation is voluntary.
Financial institutions that participate require a signed collateral security agreement and approval by the State
Treasurer. The School maintains bank accounts in Wells Fargo Bank, which is a participating banking institution
and the School has joined the statewide collateral pool.
21
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 4 – CONCENTRATION OF CREDIT RISK (Continued)
The cash held by the financial institution is insured up to the Federal Deposit Insurance Corporation (FDIC)
insurance limits of $250,000. At June 30, 2023, the School’s cash deposits were fully insured with no
uncollateralized portions. Custodial credit risk is the risk that the School may not be able to recover the value of
the deposits that are in the possession of an outside party. The School does not have a formal policy for custodial
credit risk.
NOTE 5 – CAPITAL ASSETS
A summary of changes in capital assets from governmental activities for the year ended June 30, 2023 is as follows:
Balance Balance
June 30, 2022 Additions Deletions June 30, 2023
Cost of assets
Furniture and equipment 138,461$ -$ -$ 138,461$
Leasehold improvements 459,270 - - 459,270
Total 597,731 - - 597,731
Accumulated depreciation
Furniture and equipment (138,460) - - (138,460)
Leasehold improvements (459,270) - - (459,270)
Total (597,731) - - (597,731)
-$ -$ -$ -$
Depreciation expense was not charged to activities as the School considers its assets to impact multiple activities
and allocation is not practical.
NOTE 6 – LEASES
On June 1, 2022, the School entered into a non-cancelable lease agreement for the school and ancillary uses. The
agreement has a term of 38 months with lease payments of $46,100 due at the beginning of each month and
escalating in various periods.
At the time of the initial measurement, there were no interest rates specified in the School’s various non-cancelable
lease agreement. The School has used an incremental rate of 3.5%.
22
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 6 – LEASES (Continued)
A summary of changes in capital assets from governmental activities for the year ended June 30, 2023 is as follows:
June 30, 2022 Additions Deletions June 30, 2023
Intangible lease asset - buildings 1,704,070$ -$ (13,473)$ 1,690,597$
Accumulated amortization (44,844) (533,164) (354) (578,362)
1,659,226$ (533,164)$ (13,827)$ 1,112,235$
The future minimum lease payments under the School’s non-cancelable lease agreements are as follows:
Year Ending June 30, Principal Interest
2024 549,812$ 33,165$
2025 596,421$ 13,140$
2026 50,649$ 148$
NOTE 7 – EDUCATIONAL MANAGEMENT ORGANIZATION
The School pays K12, a Stride, Inc. company, in accordance with an education, administration and technology
agreement entered into by both parties.
The School had an outstanding balance payable to the K12 of $453,818 as of June 30, 2023, and incurred expenses
for the administrative and technology related services amounting to $2,432,416 for the year then ended.
NOTE 8 – DEFINED BENEFITS PENSION PLAN
Plan Description
The School is a public employer participating in the Public Employees Retirement System of the State of Nevada
(the “System”), a defined benefit cost-sharing multiple-employer program, and all employees considered to be full-
time equivalents (FTE) of 50% of more are covered under the system. The System is administered to provide a
reasonable base income to qualified employees who have been employed by a public employer and whose earnings
capacities have been removed or substantially impaired by age or disability.
23
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 8 – DEFINED BENEFITS PENSION PLAN (Continued)
Plan Description (Continued)
Amounts reported as deferred outflows and deferred inflows of resources, without regard to the contributions
subsequent to the measurement date, related to pensions will be recognized in pension expense as follows for the
years ended June 30:
2024 522,968$
2025 524,800
2026 468,559
2027 1,812,974
2028 245,462
Benefits Provided
Benefits, as required by statute, are determined by the number of years of accredited service at the time of
retirement and the member’s highest average compensation in any 36 consecutive months, with special provisions
for members entering the System on or after January 1, 2010. Benefit payments to which participants may be
entitled under the plan include pension benefits, disability benefits and survivor benefits.
Monthly benefit allowances for members are computed at 2.5% of average compensation for each accredited year
of service prior to July 1, 2001. For service earned on and after July 1, 2001, this factor is 2.67% of average
compensation. For members entering the System on or after January 1, 2010, there is a 2.5% service time factor
and for members entering the System on or after July 1, 2015, there is a 2.25% factor. The System offers several
alternatives to the unmodified service retirement allowance which, in general, allows the retired employee to accept
a reduced service retirement allowance payable monthly during his or her lifetime and various optional monthly
payments to a named beneficiary after his or her death.
Vesting
Members are eligible for retirement at age 65 with 5 years of service, at age 60 with 10 years of service or at any
age with 30 years of service for members enrolled prior to January 1, 2010. Members enrolled on or after January
1, 2010 are eligible for retirement at age 65 with 5 years of service, at age 62 with 10 years of service, and at any
age with 30 years of service. Members who entered the System on or after July 1, 2015 are eligible for retirement
at age 65 with 5 years of service, at age 62 with 10 years of service, at age 55 with 30 years of service, or any age
with 33 1/3 years of service.
The normal ceiling limitation on monthly benefits allowances is 75% of average compensation. However, a
member who has an effective date of membership before July 1, 1985, is entitled to a benefit of up to 90% of
average compensation. Members become fully vested as to benefits upon completion of five years of service.
Members become fully vested as to benefits upon completion of five years of service.
24
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 8 – DEFINED BENEFITS PENSION PLAN (Continued)
Contributions
The authority for establishing and amending the obligation to make contributions and member contribution rates is
set by statute. New hires, in agencies which did not elect the Employer-Pay Contribution (EPC) plan prior to July 1,
1983, have the option of selecting one of two contribution plans. In one plan, contributions are shared equally by
employer and employee. In the other plan, employees can take a reduced salary and have contributions made by the
employer (EPC).
The System’s basic funding policy provides for periodic contributions at a level pattern of cost as a percentage of
salary throughout an employee’s working lifetime in order to accumulate sufficient assets to pay benefits when due.
The System receives an actuarial valuation on an annual basis indicating the contribution rates required to fund the
System on an actuarial reserve basis.
Contributions actually made are in accordance with the required rates established by the Nevada Legislature. These
statutory rates are increased or decreased pursuant to NRS 286.421 and 286.450. The actuarial funding method
used is the Entry Age Normal Cost Method. It is intended to meet the funding objective and results in a relatively
level long-term contribution requirement as a percentage of salary.
For the year ended June 30, 2022, the statutory employee/employer plan matching rate was 15.50% while the
employer-pay contribution rate was 29.75%.
Pension Liabilities, Pension Expense, and Related Deferred Inflows and Outflows of Resources
At June 30, 2023, the School reported a liability of $13,379,381 for its proportionate share of the net pension
liability. The net pension liability was measured as of June 30, 2022, and the total pension liability used to calculate
the net pension liability was based on an actuarial valuation as of that date. Each employer’s proportion of the net
pension liability is based on their combined employer and member contributions relative to the total combined
employer and member contributions for all employers for the period ended June 30, 2022, actuarially determined.
At June 30, 2022, the School’s proportion was 0.07410%.
Deferred
Outflows of
Resources
Deferred Inflows
of Resources
Differences between expected and actual experience 1,732,409$ 9,558$
Change in assumptions 1,718,675 -
Net difference between projected and actual
investment earnings on pension plan investments 163,236 -
Changes in proportion and differences between employer
contributions and proportionate share of contributions 1,256,182 1,190,727
Contributions subsequent to the measurement date 1,434,208 -
6,304,710$ 1,200,285$
25
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 8 – DEFINED BENEFITS PENSION PLAN (Continued)
Actuarial Assumptions
The System’s net pension liability was measured as of June 30, 2022 and the total pension liability used to calculate
the net pension liability was determined by an actuarial valuation as of that date.
The total pension liability was determined using the following actuarial assumptions, applied to all periods included
in the measurement:
Inflation rate 2.50%
Productivity pay increase 0.5%
Projected salary increases Regular: 4.20% to 9.10%, depending on service
Rates include inflation and productivity increases
Investment rate of return 7.25%
Other assumptions Same as those used in the June 30, 2022 funding actuarial valuation*
Actuarial assumptions used in the June 30, 2022 valuation were based on the results of the experience review
completed for the period of July 1, 2016 through June 30, 2020. The discount rate used to measure the total
pension liability was 7.25% as of June 30, 2022. The projection of cash flows used to determine the discount rate
assumed that employee and employer contributions will be made at the rate specified in the statue. Based on that
assumption, the pension plan’s fiduciary net position at June 30, 2022 was projected to be available to make all
projected future benefit payments of current active and inactive employees. Therefore, the long-term expected rate
of return on pension plan investments was applied to all periods of projected benefit payments to determine the
total pension liability as of June 30, 2022.
Investment Policy
The System’s policies which determine the investment portfolio target asset allocation are established by the
Retirement Board. The asset allocation is reviewed annually and is designed to meet the future risk and return
needs of the System.
The following was the Retirement Board’s adopted policy target asset allocation as of June 30, 2022:
Asset Class Target Allocation
Long-term
Geometric
Expected Real
Rate of Return*
Domestic equity 42% 5.50%
International equity 18% 5.50%
Domestic fixed income 28% 0.75%
Private markets 12% 6.65%
*As of June 30, 2022, PERS’ long-term inflation assumption was 2.50%.
26
NEVADA VIRTUAL ACADEMY
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2023
NOTE 8 – DEFINED BENEFITS PENSION PLAN (Continued)
Discount Rate and Pension Liability Discount Rate Sensitivity
The following presents the net pension liability of the PERS as of June 30, 2022, calculated using the discount rate
of 7.25%, as well as what the PERS net pension liability would be if it were calculated using a discount rate that is
one percentage-point lower (6.25%) or one percentage-point higher (8.25%) than the current discount rate:
1% Decrease in
Discount Rate
(6.25%)
Discount Rate
(7.25%)
1% Increase in
Discount Rate
(8.25%)
Net pension liability 20,541,727$ 13,379,381$ 7,469,371$
Pension Plan Fiduciary Net Position
Additional information supporting the Schedule of Employer Allocations and the Schedule of Pension Amounts by
Employer is located in the PERS Popular Annual Financial Report (PAFR) available on the PERS website at
www.nvpers.org under Quick Links – Publications. That report may also be obtained by writing to Public
Employees Retirement System of Nevada, 693 West Nye Lane, Carson City, Nevada 89703 or by calling 775-687-
4200.
NOTE 9 – NET POSITION RECONCILIATION FOR GASB 68
The following reconciles the net position from the government-wide financial statements to an adjusted net
position, which excludes balances directly related to GASB 68 pension reporting requirements, as of June 30, 2023:
Net position including GASB 68 adjustment (4,831,280)$
Add: net pension liability 13,379,381
Add: deferred inflows of resources 1,200,285
Less: deferred outflows of resources (6,304,710)
Net position without GASB 68 adjustment 3,443,676$
NOTE 10 – CONCENTRATIONS
The School receives approximately 83% of its funding from the Pupil-Centered Funding Plan from the State of
Nevada Department of Education. This funding is based on student enrollments and represents a concentration of
revenues.
NOTE 11 – SUBSEQUENT EVENTS
Subsequent events have been evaluated through October 18, 2023, which is the date the financial statements were
available to be issued. No additional events were identified that would require additional disclosure.
SUPPLEMENTARY INFORMATION
See independent auditor’s report.
27
Nevada Virtual Academy
Budget Comparison Schedule (Unaudited)
Modified Accrual
For the Fiscal Year Ended June 30, 2023
Variance
Favorable /
Budget Actual (Unfavorable)
REVENUE
Local revenue sources -$ 96,260$ 96,260$
State revenue sources 15,733,512 15,549,983 (183,529)
Federal revenue sources 1,877,953 2,623,718 745,765
Total revenue 17,611,465 18,269,961 658,496
EXPENDITURES
Program expenditures
Regular programs 12,016,896 11,837,735 179,161
Special programs 1,181,836 2,976,388 (1,794,552)
Total programs expenditures 13,198,732 14,814,123 (1,615,391)
Debt service - 503,335 (503,335)
Undistributed support services 4,322,151 1,199,692 3,122,459
Total expenditures 17,520,883 16,517,150 1,003,733
Excess (deficiency) of revenue over
expenditures 90,582 1,752,811 1,662,229
FUND BALANCE, beginning 1,775,511 1,775,511 -
FUND BALANCE, ending 1,866,093$ 3,528,322$ 1,662,229$
See independent auditor’s report.
28
Nevada Virtual Academy
Supplemental Pension Information
For the Fiscal Year Ended June 30, 2023
Measurement
date of
June 30*:
Proportion of
the net pension
liability
Proportionate
share of the net
pension liability
Covered-
employee
payroll
Proportionate share
of the net pension
liability as a
percentage of its
covered-employee
payroll
Plan fiduciary net
position as a
percentage of the
total pension
liability
2016 0.09039% 12,163,354$ 6,509,005$ 186.9% 72.2%
2017 0.08465% 11,258,084$ 5,616,429$ 200.4% 74.4%
2018 0.07700% 10,501,522$ 5,255,025$ 199.8% 75.2%
2019 0.06972% 9,507,206$ 4,881,663$ 194.8% 76.5%
2020 0.06099% 8,495,195$ 4,457,071$ 190.6% 77.0%
2021 0.07080% 6,456,502$ 5,580,454$ 115.7% 86.5%
2022 0.07410% 13,379,381$ 6,286,035$ 212.8% 75.1%
for 2017. Therefore, only seven years are shown.
* Fiscal year 2017 was the first year for which information was available. 2016 was the relevant measurement
See independent auditor’s report.
29
Nevada Virtual Academy
Supplemental Contribution Schedule
For the Fiscal Year Ended June 30, 2023
Fiscal year
ended
June 30:
Contractually
required
contribution
Contributions in
relation to the
contractually
required
contribution
Contribution
deficiency
(excess)
School's covered
-
employee payroll
Contributions as a
percentage of covered-
employee payroll
2016 1,103,596$ 1,103,596$ -$ 6,509,005$ 17.0%
2017 1,225,184$ 1,225,184$ -$ 5,616,429$ 21.8%
2018 1,430,280$ 1,430,280$ -$ 5,255,025$ 27.2%
2019 1,343,571$ 1,343,571$ -$ 4,457,071$ 30.1%
2020 1,276,266$ 1,276,266$ -$ 5,580,454$ 22.9%
2021 1,120,831$ 1,120,831$ -$ 5,137,682$ 21.8%
2022 1,222,622$ 1,222,622$ -$ 5,580,454$ 21.9%
2023 1,434,208$ 1,434,208$ -$ 6,286,035$ 22.8%
* Fiscal year 2017 was the first year of for which information was available. Therefore, 8 years are shown.
See independent auditor’s report.
30
Nevada Virtual Academy
Financial Statement Audit Results Summary
For the Fiscal Year Ended June 30, 2023
1 School name Nevada Virtual Academy
2 School year ended 2023
3 Year of operations 2007
4 Independent auditor Ellsworth & Stout, LLC
5 Cash 4,561,168
6 Current assets 5,183,334
7 Noncurrent assets 1,183,585
8 Deferred outflows 6,304,710
9 Current liabilities 2,276,173
10 Noncurrent liabilities 14,026,451
11 PERS pension liability 13,379,381
12 Deferred inflows 1,200,285
13 Revenues 18,269,961
14 Expenditures 16,400,901
15 Annual principal 452,232
16 Interest expense 51,103
17 Depreciation expense 0
18 Outstanding loan No
19 Debt default No
See independent auditor’s report.
31
Nevada Virtual Academy
Schedule of Financial Performance
For the Year Ended June 30, 2023
Standard: Result:
Meets or
Exceeds?
Near-Term Financial Indicators:
Current ratio 1.1 or greater 2.3 YES
Unrestricted days cash-on-hand 60 days or more 102 YES
Debt default Should be NO N/A YES
Sustainability Indicators:
Aggregate 3 year total margin -1.5% or greater 7.17% YES
Current year total margin Positive 10.23% YES
Debt-to-asset ratio (net of pension liability) 0.90 or less 0.46 YES
Multi-year cash flow Positive 2,191,463 YES
One-year cash flow Positive 826,020 YES
Debt-service coverage ratio
(net of GASB 68 pension adjustment)
1.1 or greater N/A N/A
COMPLIANCE SECTION
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON
COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
To the School Board of
Nevada Virtual Academy
We have audited, in accordance with the auditing standards generally accepted in the United States of America 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 the governmental activities and each major fund of Nevada Virtual Academy (the
School) as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively
comprise Nevada Virtual Academy’s basic financial statements, and have issued our report thereon dated October 18, 2023.
Report on Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the School’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 opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the
School’s internal control. Accordingly, we do not express an opinion on the effectiveness of the School’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 a 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 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 material weaknesses or significant deficiencies and
therefore, material weaknesses or significant deficiencies may exist that were not identified. We identified certain deficiencies
in internal control, described in the accompanying schedule of findings and questioned costs as items 2023-001 that we
consider to be material weaknesses.
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether Nevada Virtual Academy’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.
Nevada Virtual Academy’s Response to Findings
Government Auditing Standards requires the auditor to perform limited procedures on the School’s response to the findings
identified in our audit and described in the accompanying schedule of findings and questioned costs. The School’s response
was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express
no opinion on the response.
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 School’s internal control or on compliance. This report is an
integral part of an audit performed in accordance with Government Auditing Standards in considering the School’s internal
control and compliance. Accordingly, this communication is not suitable for any other purpose.
Las Vegas, Nevada
October 18, 2023
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM
AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE
To the School Board
Nevada Virtual Academy
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited Nevada Virtual Academy’s compliance with the types of compliance requirements
described in the OMB
Compliance Supplement that could have a direct and material effect on each of Nevada Virtual Academy’s major federal
programs for the year ended June 30, 2023. Nevada Virtual Academy’s major federal programs are identified in the summary
of auditor’s results section of the accompanying schedule of findings and questioned costs.
In
our opinion, Nevada Virtual Academy (the School), complied, in all material respects, with the types of compliance
requirements referred to above that could have a direct and material effect on each of its major federal programs for the year
ended June 30, 2023.
Basis for Opinion on Each Major Federal Program
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of
America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform
Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Our
responsibilities under those standards and the Uniform Guidance are further described in the Auditor’s Responsibilities for the
Audit of Compliance section of our report.
We are required to be independent of the School and to meet our other ethical responsibilities, in accordance with relevant
ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a legal determination
of the School’s compliance with the compliance requirements referred to above.
Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and
maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules, and
provisions of contracts or grant agreements applicable to the School’s federal programs.
Auditor’s Responsibility for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements
referred to above occurred, whether due to fraud or error, and express an opinion on the School’s compliance based on our
audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an
audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform
Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting
from fraud is higher than that resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is
considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment
made by a reasonable user of the report on compliance about the School’s compliance with the requirements of each major
federal program as a whole.
In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards, and the
Uniform Guidance, we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit
procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding Nevada
Virtual Academy’s compliance with the compliance requirements referred to above and performing such other
procedures as we considered necessary in the circumstances.
Obtain an understanding of Nevada Virtual Academy’s internal control over compliance relevant to the audit in order
to design audit procedures that are appropriate in the circumstances and to test and report on internal control over
compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the
effectiveness of Nevada Virtual Academy’s internal control over compliance. Accordingly, no such opinion is
expressed.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we
identified during the audit.
Report on Internal Control over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not
allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct,
noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal
control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is
a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be
prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a
deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a
federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit
attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the Auditor’s Responsibilities
for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance
that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations,
during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material
weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance
may exist that were not identified.
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance.
Accordingly, no such opinion is expressed.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control
over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is
not suitable for any other purpose.
Las Vegas, Nevada
October 18, 2023
36
The accompanying notes are an integral part of these financial statements.
Nevada Virtual Academy
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2023
Federal Grantor / Pass-Through
Grantor / Program or Cluster Title
Federal
Assistance
Listing
Number
Pass-Through
Entity
Identifying
Number
Provided to
Subrecipients
Total
Federal
Expenditures
U.S. Department of Education
Passed through the State of Nevada
Special Education - Grants to States (IDEA Part B) 84.027 609,821$
Passed through Nevada State Public Charter School Authority
Special Education - Grants to States (IDEA Part B) 84.027
338,542
COVID-19 Special Education - Grants to States (IDEA Part B) 84.027
74,271
Total Special Education Cluster
1,022,634
Title 1 - Grants to Local Educational Agencies
(Title I, Part A of the ESEA)
84.010 674,070
Supporting Effective Instruction State Grants
(Formerly known as Improving Teacher Quality State Grants)
84.367 238,120
Student Support and Academic Enrichment Program
84.424 38,312
COVID-19 Elementary and Secondary School Emergency Relief
(ESSER) Fund
84.425D 650,582
Total Expenditures of Federal Awards
2,623,718$
37
NEVADA VIRTUAL ACADEMY
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2023
NOTE 1 – BASIS OF PRESENTATION
The accompanying schedule of expenditures of federal awards (Schedule) includes the federal award activities of
Nevada Virtual Academy under programs of the federal government for the year ended June 30, 2023. The
information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal
Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal
Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of Nevada
Virtual Academy, it is not intended to and does not present the financial position or activities of Nevada Virtual
Academy.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Expenditures are recognized on the modified accrual basis, which is based on when costs become a demand on
current available financial resources. Such expenditures are recognized following the cost principles contained in
the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
No federal financial assistance has been provided to a subrecipient.
NOTE 3 – INDIRECT COSTS
The School’s federal award programs cover expenditures approved as a part of the federal grant or as otherwise
allowed by applicable laws or regulations. For the year ended June 30, 2023, the School did not allocate any
indirect costs to its federal award programs.
SCHEDULE OF FINDINGS AND
QUESTIONED COSTS
38
NEVADA VIRTUAL ACADEMY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2023
Section I - Summary of Auditors' Results
Financial Statements
Type of report the auditor issued on whether the financial statements
audited were prepared in accordance with GAAP: Unmodified
Internal control over financial reporting:
Material weaknesses identified? x yes no
Significant deficiencies identified? yes x none reported
Noncompliance material to financial statements noted? yes x no
Federal Awards
Internal control over major federal programs:
Material weaknesses identified? yes x no
Significant deficiencies identified? yes x none reported
Type of auditor's report issued on compliance
for major federal programs: Unmodified
Any audit findings disclosed that are required to
be reported in accordance with section
2 CFR 200.516(a)? yes x no
Identification of major federal programs:
84.425
Education Stabilization Fund
84.010
Title 1 - Grants to Local Educational Agencies
(Title I, Part A of the ESEA)
Dollar threshold used to distinguish between Type A and Type B programs: $750,000
Auditee qualified as a low-risk auditee? x yes no
CFDA Number
Name of Federal Program or Cluster:
39
NEVADA VIRTUAL ACADEMY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
FOR THE YEAR ENDED JUNE 30, 2023
Section II – Financial Statement Findings
None reported.
Section III – Federal Award Findings and Questioned Costs
Finding:
2023-
001
Criteria: The Organization’s internal control and accounting systems should identify when
revenues are earned and ensure they are recorded in the correct period and reconcile
accounts receivable at least monthly.
Condition: The Organization’s financial close and reporting process did not capture revenue in
correct period or reconcile revenue to what was actually earned as of year end.
Revenues are recorded based off expenses recorded in the related fund. Receivables
were not reconciled monthly and confirmed with subsequent deposits.
Cause: The Organization’s financial close and reporting process was not sufficient to capture
revenues in the correct period and reconcile the accounts receivable balances.
Effect: Control deficiencies noted above resulted in adjustments to the financial statements
related to revenues, receivables, and related expense allocations. The adjustments also
affected net income and the expenses presented in the special projects fund on the
statement of revenues, expenditures, and changes in fund balance.
Recommendation: The Organization should reconcile receipts monthly from grantors received through
requests for reimbursement to what is recorded in the respective fund related to that
funding source. In addition, receivables should be reconciled on a monthly basis to
ensure the accuracy of receivable balances.
Status: See summary schedule of prior audit findings.
8645 S Eastern Ave. #100
Las Vegas, Nevada 89123
Phone: 702-407-1825
Fax: 702-407-5055
nevadavirtual.org
NevadaVirtualCharterSchoolCORRECTIVEACTIONPLAN
FortheFiscalYearEndedJune30,2023
SectionII–FinancialStatementFindings
Finding:2023‐001
The Organization’s internal control and accounting systems should identify
when revenues are earned and ensure they are recorded in the correct period
and reconcile accounts receivable at least monthly.
The Organization’s financial close and reporting process did not capture
revenue in correct period or reconcile revenue to what was actually earned as
of year-end. Deposits are recorded directly to the receivables and revenues
are recorded based solely off expenses recorded in the related fund.
Recommendation:
The Organization should reconcile receipts from grantors received through
requests for reimbursement to what is recorded in the respective fund related
to that funding source. In addition, receivables should be reconciled on a
monthly basis to guarantee the accuracy of receivable balances.
CorrectiveActionPlan:
Management agrees with the recommendation.
This audit (finding) relates to fiscal year 2022-23 and the process and controls
of the previous EMO’s financial services division.
Nevada Virtual Charter School has contracted with CSMC, an experienced
back-office financial services firm that currently provides comprehensive
accounting and financial services support to multiple Nevada charter schools.
8645 S Eastern Ave. #100
Las Vegas, Nevada 89123
Phone: 702-407-1825
Fax: 702-407-5055
nevadavirtual.org
CSMC’s system of internal controls provides a quality control check by
supervisory staff in the accounting department that includes monthly
accounts receivable reconciliation and verification of timely recognition and
recording of revenues.
A process checklist is used that outlines all steps that accounting staff will
complete in the monthly fiscal cycle before closing the books, with each task
being verified as completed and reviewed by supervisory staff before the data
is prepared and presented to Nevada Virtual Charter School leadership by
CSMC’s School Business Manager.
Supervisory staff in CSMC’s accounting department also typically conducts a
year-end close quality review to verify accurate and compliant accounting
entries, including timely revenue recognition and account receivable
reconciliation.
Continuing our Client Standing Call routines - CSMC accounting staff and
School Business Manager will meet periodically with school leadership to
review and discuss current financial reports, including Actual to Budget and
current grant expenditures, balances, and required adjusting entries.
Financial updates are regularly presented at Governing Board meetings.
CSMC’s Client Services team will monitor and provide status updates to
Nevada Virtual Charter School’s site leadership and Governing Board to verify
and provide assurances that these internal controls are functioning
effectively.
.
SectionIII–FederalAwardFindingsandQuestionedCosts
None reported.
