Copyright 2017 Gannett Company, Inc.
All Rights Reserved
The NCAA incurred $1.4 billion in expenses during its 2016 fiscal year as it began allocating more than a decade's worth of accumulated money to legal settlements and costs and a special one-time distribution to Division I schools.
The expense total, shown in an audited financial statement the association released Tuesday, represents a nearly $500 million increase in the amount the association reported for its 2015 fiscal year.
Taken against a record $996 million in total revenues, the amount resulted in a $404 million -- or nearly 60% -- depletion of the NCAA's year-end net assets.
As of Aug. 31, 2016, those assets stood at $294 million. That's the NCAA's lowest year-end total since 2006, not adjusting for inflation.
NCAA chief financial officer Kathleen McNeely said in a statement the association's ability to be in a financial position to absorb these costs "is the result of the Board of Governors' thoughtful stewardship. The increase in expenditures provides programs and services that will benefit current and former student-athletes."
But because of the way the NCAA's current assets are allocated, McNeely said in an interview with USA TODAY Sports, the association learned about a week ago that Standard & Poor's had downgraded its bond rating from AA+ to AA stable. (S&P's highest bond rating is AAA.)
McNeely said the new rating is one "80% of the world would like to have" and will have no impact on the NCAA because it has "no intention of borrowing money."
"It's just a fact for us, without implication on our finances," McNeely said.
The NCAA's revenue total for 2016 represents a nearly $84 million increase compared with what it took in during 2015. In 2015, the association suffered a year-over-year revenue decrease of more than $76 million, and it operated at an annual deficit for the first time in the 11 years for which USA TODAY Sports had compiled its financial statements.
All of the spending reported for 2016 did not actually occur during the association's fiscal year. However, because of standard accounting practices and the timing of various events, the NCAA had to record the amounts in 2016.
Meanwhile, in March 2016, the Board of Governors approved a one-time supplemental distribution of $200 million to Division I members. That money is scheduled to be sent to schools this spring and is to be used to "directly support student-athletes," according to the notes accompanying the new figures.
(The NCAA's regular distributions to Division I members, including a new amount aimed at helping schools pay for cost-of-attendance-based scholarships, totaled nearly $569 million in 2016, according to the new financial statement.)
Read More of Today's AB Headlines
Subscribe to Our Daily E-Newsletter