The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The accompanying financial statements of the Foundation have been prepared in accordance with accounting principles generally accepted in the United States of America as prescribed by the FASB. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features.

During the year ended June 30, 2016 and 2015, the Foundation made distributions of approximately $1,135,900 and $206,400 respectively, on behalf of the University for both restricted and unrestricted purposes. Complete financial statements for the Foundation can be obtained from the Kentucky State University Foundation, Inc. at P.O. Box 4210, Frankfort, KY 40604.

In fiscal year 2015, the University adopted GASB Statement 68, Accounting and Financial Reporting for Pensions. The primary objective of GASB's Statement 68 is to improve accounting and financial reporting by state and local governments for pensions. The financial statements include the accrued actuarial pension liability for the Kentucky Employees Retirement System (KERS) and Kentucky Teachers' Retirement System (KTRS) and the additional components associated with recording the pension liability. The effect of this change was an increase to operating expenses of $5.34 million. The cumulative effect of the change, totaling $93.4 million, is shown as a one-time decrease to net position in the 2015 Statement of Revenues, Expenses and Changes in Net Position.

In June 2015, the GASB issued Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. The primary objective of this Statement is to improve accounting and financial reporting by state and local governments for postemployment benefits other than pensions (other postemployment benefits or OPEB). It also improves information provided by state and local governmental employers about financial support for OPEB that is provided by other entities. This Statement requires reporting of the entity's OPEB liability on the face of the financial statements and more extensive note disclosures and required supplementary information about OPEB liabilities. The provisions of this Statement are effective for reporting periods beginning after June 15, 2017. The University is currently evaluating the effects of this statement on its financial statements.