Notes to Consolidated Financial Statements June 30, 2024 and 2023 of investment securities, it is at least reasonably possible that changes in risks in the near term could materially affect investment balances and the amounts reported in the Consolidated Statements of Financial Position. Tuition and Other Receivables and Allowance for Credit Losses Tuition receivables consist of amounts billed to students for tuition, fees, housing, and other auxiliary charges. Clinic receivables consist of amounts billed to patients for services provided at NSU Health clinics. Tuition and clinic receivables are presented net of an allowance for credit losses, which is an estimate of amounts that may not be collectible. The university calculates the allowance for credit losses by separating receivables by type of receivable and into risk pools based on their aging. Loss rates are developed for each risk pool based on historical write-off experience, net of subsequent recoveries, and adjusted for management’s expectations about current and future economic conditions. Changes in the allowance for credit losses for the year ended June 30 are as follows (in thousands): 2024 Beginning Balance, July 1 $ 4,750 Provision for credit losses 7,962 Write-offs, net of recoveries (7,533) Ending Balance, June 30 $ 5,179 Deferred Debt Issue Costs Costs related to the issuance of debt ($4.0 million at June 30, 2024, and $4.3 million at June 30,2023) are being amortized over the term of the related debt instrument using the bonds outstanding method, which approximates the effective interest method. In accordance with the Financial Accounting Standards Board’s (FASB’s) Accounting Standards Update (ASU) 2015-03, Interest—Imputation of Interest (Subtopic 835-30), debt issuance costs are presented in the Consolidated Statements of Financial Position as a direct deduction from the carrying amount of the related debt, consistent with the presentation of debt discounts and premiums. Split Interest Agreements These agreements with donors consist primarily of charitable remainder annuity trusts, unitrusts, and gift annuities. Contributions receivable from remainder trusts The university is the beneficiary of trusts held and administered by others. The current values of estimated future cash receipts from the trusts are recognized in accordance with donor stipulations as assets and contributions with donor restrictions when NSU is notified of the establishment of the trust. Changes in the fair values of the trusts are recorded as other revenue with donor restrictions within the Consolidated Statements of Activities. Due to beneficiaries under remainder trusts and annuities NSU is a trustee for trust assets, which are included in investments. Contribution revenues are recognized, in accordance with donor stipulations, when the trusts are established, after recording liabilities for estimated future payments (discounted over the donor’s or other beneficiary’s life expectancy using published mortality tables). These liabilities are adjusted annually for changes in asset values and estimated future benefits. The university has entered into arrangements whereby assets are transferred from a donor, with purpose restrictions, to the university in exchange for a promise by the university to pay fixed amounts for a specified period of time to the donor or to other donor designees. The difference between the assets received and the 18
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