The Commonwealth of Kentucky operates a public entity risk pool operating as a common risk management and insurance program for its members. The University pays an annual premium to the pool for its workers' compensation insurance coverage. The pool's governing agreement specifies that the pool will be self-sustaining through member premiums and will reinsure through commercial carriers for claims in excess of specified stop loss amounts.
In the Statement of Revenues, Expenses and Changes in Net Position, operating expenses are presented by functional expense purpose. Functional expense purpose is classified below by natural classification, such as salaries, benefits, and goods and services.
Depreciation is allocated below based on functional classification as required by IPEDS for Fiscal Year 2013. The tables below summarize operating expenses by functional purpose for the years ended June 30, 2013 and 2012:
2013
| Compensation & Benefits | Supplies & Services | Scholarships & Fellowships | Depreciation | Operations & Maintenance | Total | |
|---|---|---|---|---|---|---|
| Instruction | $ 12,400,132 | $ 1,261,665 | $ 39,442 | $ 648,012 | $ 1,345,441 | $ 15,694,692 |
| Research | 3,698,586 | 2,085,005 | - | 797,270 | 617,047 | 7,197,908 |
| Public service | 4,002,827 | 1,416,702 | - | 287,160 | 535,081 | 6,241,770 |
| Academic support | 2,001,154 | 1,366,739 | - | 279,201 | 341,966 | 3,989,060 |
| Student services | 5,368,188 | 2,314,885 | 29,089 | 477,347 | 767,880 | 8,957,389 |
| Institutional support | 6,832,234 | 2,915,953 | (75,391) | 984,830 | 1,197,048 | 11,854,674 |
| Operation & maintenance of plant | 2,029,743 | 3,572,257 | - | 683,049 | (6,285,049) | - |
| Auxiliary enterprises | 1,192,313 | 5,081,378 | - | 336,961 | 619,841 | 7,230,493 |
| Student financial aid | 556,159 | 344,814 | 8,261,704 | 17,238 | 860,745 | 10,040,660 |
| Total operating expense | $ 38,081,336 | $ 20,359,398 | $ 8,254,844 | $ 4,511,068 | $ - | $ 71,206,646 |