Annual financial report 2022 June 30, Marion County Board of Education, Buena Vista, Georgia, including independent auditor's report.

ANNUAL FINANCIAL REPORT FISCAL YEAR 2022
Marion County Board of Education
Buena Vista, Georgia
Including Independent Auditor's Report
Greg S. Griffin | State Auditor

Marion County Board of Education

Table of Contents

Section I

Financial Independent Auditor's Report

Required Supplementary Information

Management's Discussion and Analysis

i

Exhibits

Basic Financial Statements

Government-Wide Financial Statements

A

Statement of Net Position

1

B

Statement of Activities

2

Fund Financial Statements

C

Balance Sheet

Governmental Funds

3

D

Reconciliation of the Governmental Funds Balance Sheet

to the Statement of Net Position

4

E

Statement of Revenues, Expenditures and Changes in Fund Balances

Governmental Funds

5

F

Reconciliation of the Governmental Funds Statement of

Revenues, Expenditures and Changes in Fund Balances

to the Statement of Activities

6

G

Statement of Fiduciary Net Position

Fiduciary Funds

7

H

Statement of Changes in Fiduciary Net Position

Fiduciary Funds

8

I Notes to the Basic Financial Statements

10

Schedules

Required Supplementary Information

1 Schedule of Proportionate Share of the Net Pension Liability

Teachers Retirement System of Georgia

45

2 Schedule of Contributions Teachers Retirement System of Georgia

46

3 Schedule of Proportionate Share of the Net Pension Liability Public

School Employees Retirement System of Georgia

47

4 Schedule of Proportionate Share of the Net OPEB Liability

School OPEB Fund

48

5 Schedule of Contributions School OPEB Fund

49

6 Notes to the Required Supplementary Information

50

Required Supplementary Information (Continued)

7 Schedule of Revenues, Expenditures and Changes in Fund

Balances - Budget and Actual General Fund

51

Supplementary Information

8 Schedule of Expenditures of Federal Awards

52

9 Schedule of State Revenue

54

10 Schedule of Approved Local Option Sales Tax Projects

55

Section II
Compliance and Internal Control Reports
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
Independent Auditor's Report on Compliance for Each Major Federal Program and on Internal Control Over Compliance Required by the Uniform Guidance

Section III Auditee's Response to Prior Year Findings and Questioned Costs Summary Schedule of Prior Audit Findings

Section IV Findings and Questioned Costs Schedule of Findings and Questioned Costs

Section I Financial

Greg S. Griffin State Auditor
INDEPENDENT AUDITOR'S REPORT
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Mr. Jamie Penoncello, Superintendent and Members of the Marion County Board of Education
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, each major fund, and fiduciary activities of the Marion County Board of Education (School District) as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the School District'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, each major fund, and fiduciary activities of the School District as of June 30, 2022, 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 Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) 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 District 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 opinions.
Emphasis of Matter
As described in Note 2 to the financial statements, in 2022, the School District adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 87, Leases. The School District restated beginning balances for the effect of GASB Statement No. 87. Our opinions are not modified with respect to this matter.
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

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 District'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 opinions. 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 GAAS 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 GAAS 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 District'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 District'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 required supplementary information listed in the table of contents 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 GAAS, 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 appropriate evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements.
The supplementary 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. Such 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 GAAS. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 28, 2023 on our consideration of the School District'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 District'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 District's internal control over financial reporting and compliance.

A copy of this report has been filed as a permanent record and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. Respectfully submitted,
Greg S. Griffin State Auditor
March 28, 2023

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022
The Management's Discussion and Analysis ("MD&A") of the Marion County Board of Education's (the "School District") financial performance provides an overall review of the School District's financial activities for the fiscal year ended June 30, 2022. The intent of this MD&A is to look at the School District's financial performance as a whole; readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance.
Financial Highlights
Key financial highlights for fiscal year 2022 are as follows:
The School District's financial status remained stable during fiscal year 2022. In total, net position increased $5.0 million from fiscal year 2021. This total increase was due to governmental activities since the School District has no business-type activities. This increase was primarily due to the increase in operating grants and the decrease in instructional expense.
General revenues accounted for $6.9 million, or 32.1%, of all revenues. Program specific revenues in the form of charges for services and sales, grants and contributions accounted for $14.7 million, or 67.9%, of total revenues. Total revenues were $21.7 million.
The School District had $16.7 million in expenses related to governmental activities; these expenses were offset by $14.7 million in program specific charges for services, grants or contributions. General revenues and taxes of $6.9 million also provided for these programs.
Among major funds, the General Fund had $20.0 million in revenues and $19.7 million in expenditures and other financing uses. The General Fund's fund balance increased from $5.1 million to $5.4 million.
Using the Basic Financial Statements
This annual report consists of a series of financial statements and notes to those statements. These statements are organized so the reader can understand the School District as a financial whole, or as an entire operating entity.
The Statement of Net Position and Statement of Activities provide information about the activities of the whole School District, presenting both an aggregate view of the School District's finances and a long-term view of those finances. The fund financial statements provide the next level of detail. For governmental funds, these statements tell how services were financed in the shortterm as well as what remains for future spending. The fund financial statements also look at the
i

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022
School District's most significant funds with all other nonmajor funds, if any, presented in total in one column. In the case of the School District, the General Fund is by far the most significant fund.
Reporting the School District as a Whole
Statement of Net Position and Statement of Activities While these documents contain the large number of funds used by the School District to provide programs and activities, the view of the School District as a whole looks at all financial transactions and asks the question, "How did we do financially during fiscal year 2022?" The Statement of Net Position and the Statement of Activities answer this question. These statements include all assets and all liabilities using the accrual basis of accounting similar to the accounting used by most private-sector companies. This basis of accounting takes into account all of the current year's revenues and expenses regardless of when cash is received or paid.
These two statements report the School District's net position and changes in net position. This change in net position is important because it tells the reader whether, for the School District as a whole, the financial position of the School District has improved or diminished. The causes of this change may be the result of many factors, some financial, some not. Non-financial factors include the School District's property tax base, facility conditions, required educational programs and other factors.
In the Statement of Net Position and the Statement of Activities, the School District has one distinct type of activity:
Governmental Activities All of the School District's programs and services are reported here including instruction, support services, operation and maintenance of plant, pupil transportation, food service, after school program, school activity accounts and various others.
Reporting the School District's Most Significant Funds
Fund Financial Statements Fund financial statements provide detailed information about the School District's major funds. The School District uses many funds to account for a multitude of financial transactions. However, these fund financial statements focus on the School District's most significant funds. The School District's major governmental funds are the General Fund, the Capital Projects Fund and the Debt Service Fund.
ii

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Governmental Funds All of the School District's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds is reconciled in the financial statements. Fiduciary Funds The School District is the trustee, or fiduciary, for assets that belong to others, such as school clubs and organizations within the school activity accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the government-wide financial statements because it cannot use these assets to finance its operations.
iii

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022

The School District as a Whole

The perspective of the Statement of Net Position is of the School District as a whole. Table 1 provides a summary of the School District's net position for fiscal year 2022, compared to fiscal year 2021.

Table 1 Net Position

2022

2021 (1)

Current and other assets Capital & right to use assets Total assets
Deferred outflows of resources

$ 14,967,408 30,638,698 45,606,106
6,380,763

$ 12,863,997 30,049,435 42,913,432
7,266,160

Long-term liabilities outstanding Other liabilities Total liabilties
Deferred inflows of resources

29,901,499 1,815,999
31,717,498
14,011,885

42,954,391 1,787,523
44,741,914
4,175,548

Net position: Net investment in capital assets Restricted Unrestricted (deficit) Total net position

15,183,807 8,207,164
(17,133,485) $ 6,257,486

14,229,633 6,122,413
(19,089,916) $ 1,262,130

(1) Fiscal Year 2021 balances do not reflect the effect of the restatement of balances. See Note 6 and Note 8 in the Notes to the Basic Financial Statements for additional information.

iv

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022

Table 2 shows the changes in net position for fiscal year 2022, compared to fiscal year 2021. The total net position increased $5.0 million for fiscal year 2022, compared to $0.8 million increase for fiscal year 2021. The increase in fiscal year 2022 was due to increase in operating grants and contributions, capital grants and contributions, sales tax collections and other miscellaneous revenues as well as a decrease in expenses.

Table 2 Changes in Net Position

Revenues Program revenues:
Charges for services Operating grants and contributions Capital grants and contributions General revenues: Property taxes
For maintenance and operations For debt service Sales taxes Other taxes Grants and contributions not restricted to specific programs
Investment income Miscellaneous
Total revenues Expenses Instruction Support services
Pupil services Improvement of instructional services Educational media services General administration School administration Business administration Maintenance and operations Student transportation services Central support services Other support services Operations of non-instructional services Food service operations Enterprise operations Interest on long-term debt
Total expenses Increase in net position Net position, beginning of year Net position, end of year

2022

2021 (1)

$ 135,666 13,944,756 629,826

$ 99,314 10,665,912 575,143

3,605,923 355,745 660,348 92,610
1,776,475 127,093 334,132
21,662,574
8,592,363
425,336 650,533 205,313 295,806 985,380 215,738 1,771,969 1,469,040 159,195
84,468
1,079,701 125,684 606,692
16,667,218 4,995,356 1,262,130
$ 6,257,486

3,559,920 346,041 597,382 89,769
1,730,778 125,563 197,762
17,987,584
9,560,136
489,255 702,488 235,919 358,542 1,190,816 237,389 1,574,375 1,116,978 187,531
94,437
817,729 38,731
619,801 17,224,127
763,457 498,673 $ 1,262,130

(1) Fiscal Year 2021 balances do not reflect the effect of the restatement of balances. See Note 6 and Note 8 in the Notes to the Basic Financial Statements for additional information.
v

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022

Governmental Activities

Direct instruction comprises 51.6% of governmental program expenses.

The Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services. That is, it identifies the cost of these services supported by tax revenue and unrestricted state entitlements. Comparative data from fiscal year 2021 is also presented.

Table 3 Governmental Activities

Total Cost of Services

Fiscal Year

Fiscal Year

2022

2021 (1)

Net (Cost) of Services

Fiscal Year

Fiscal Year

2022

2021 (1)

Instruction Support Services:
Pupil services Improvement of
instructional services Educational media services General administration School administration Business administration Maintenance and operations Student transportation services Central support services Other support services Food service operations Enterprise operations Interest on long-term debt
Total Expenses

$ 8,592,363
425,336
650,533 205,313 295,806 985,380 215,738 1,771,969 1,469,040 159,195
84,468 1,079,701
125,684 606,692 $ 16,667,218

$ 9,560,136
489,255
702,488 235,919 358,542 1,190,816 237,389 1,574,375 1,116,978 187,531
94,437 817,729
38,731 619,801 $ 17,224,127

$ (25,054)
(225,734)
90,738 8,477
141,861 371,166 (205,770) (1,176,069) (596,469) (150,874) (70,679) 269,317 (125,684) (262,196) $ (1,956,970)

$ (2,031,475)
(295,896)
(483,276) (59,862) 67,715
(592,976) (232,004) (1,015,929) (534,582) (184,539)
(75,749) (162,014)
(38,731) (244,440) $ (5,883,758)

(1) Fiscal Year 2021 balances do not reflect the effect of the restatement of balances. See Note 6 and Note 8 in the Notes to the Basic Financial Statements for additional information.

Although program revenues make up a majority of the revenues, the School District is still dependent upon tax revenues for governmental activities. Approximately 0.3% of instruction activities are supported through taxes and other general revenues; for all governmental activities general revenue support is 11.7%.

vi

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022
The School District's Funds The School District's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues and other financing sources of $22.7 million and expenditures and other financing uses of $20.7 million. There was an increase in fund balance of approximately $894 thousand in the Capital Projects Fund. A transfer of $1.2 million was made to cover local costs for our fiscal year 2022 State Capital Outlay project. The fund balance of the General Fund had an increase of approximately $302 thousand due to salaries and benefits coming in under budget. There was an increase in fund balance of approximately $824 thousand in the Debt Service Fund. This was because Special Purpose Local Option Sales Tax ("SPLOST") III funds are being accumulated for sinking fund payments due annually in January. General Fund Budgeting Highlights The School District's budget is prepared according to Georgia law. The most significant budgeted fund is the General Fund. During the course of fiscal year 2022, the School District amended its General Fund budget as needed. The School District uses function-based budgeting. The budgeting systems are designed to tightly control total function budgets but provide flexibility for site management. For the General Fund, budgeted revenues increased from $19.5 million to $22.3 million, while budgeted expenditures increased from $19.9 million to $22.8 million. The School District had additional grants which increased budgeted revenues and expenditures. The School District uses a strategic waiver system. One of our waivers is the state's 65% rule for Minimum Direct Classroom Expenditures.
vii

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022

Capital Assets and Intangible Right to Use Assets

At the end of fiscal year 2022, the School District had $30.6 million invested in capital and intangible right to use assets (net of depreciation and amortization), all in governmental activities. Table 4 indicates balances at June 30, 2022. Comparisons to fiscal year 2021 are also included.

Table 4 Capital Assets and Right to Use Assets (Net of Depreciation/Amortization)

2022

2021

Land Construction in progress Land improvements Buildings and improvements Equipment Intangible right to use equipment
Total

$

581,159

213,847

377,200

28,373,314

1,055,692

37,486

$ 30,638,698

$ 581,159 50,380 691,604
27,669,563 1,056,729 -
$ 30,049,435

Fiscal year 2021 balances does not reflect the effects of the implementation of GASB 87, Leases. See note 6 in the Notes to Basic Financial Statements for more information.

Long-Term Liabilities

At fiscal year ended June 30, 2022, the School District had $29.9 million in long-term liabilities outstanding. Table 5 summarizes the School District's changes in long-term liabilities for the fiscal year.

Table 5 Long-term Liabilities

Governmental activities: Bonds payable Leases Financed Purchases Net pension liability Net OPEB liability Governmental activities
Long-term liabilities

Restated Balance July 1, 2021
$ 15,845,000 407,104 41,987
13,992,702 12,734,651
$ 43,021,444

Additions

Reductions

Balance Due Within June 30, 2022 One Year

$

- $

-

-

630,783

-

(80,000) $ 15,765,000 $ 80,000

(369,231)

37,873

29,262

(41,987)

-

-

(9,606,183)

5,017,302

-

(3,653,327)

9,081,324

-

$ 630,783 $ (13,750,728) $ 29,901,499 $ 109,262

Fiscal year 2021 balances does not reflect the effects of the implementation of GASB 87, Leases. See note 6 in the Notes to Basic Financial Statements for more information.

viii

MARION COUNTY BOARD OF EDUCATION
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Current Issues
The School District's current operating millage rate is 14.981 mills. The bond millage rate is 1.761 mills. Management and the Board of Education hope to hold this level for a few years so as not to place a hardship on the property owners in Marion County.
SPLOST revenues and school bond ad valorem taxes, along with Federal subsidy payments, are used to service debt for the 2010B, the 2020 bonds, and the sinking fund (for the principal payments of the 2010B Bonds).
Three issues that the school district is currently facing are employee retention1, school safety2, and learning loss due to COVID3.
1In fiscal year 2022, the school district issued retention bonuses totaling $3,000 for full-time employees, $1,500 for part-time employees, and $1,470 for 49% employees. The school district plans to issue retention bonuses again in fiscal year 2023. The school district has also implemented the use of mentor teachers to help guide new teachers.
2In fiscal year 2022, the school district continued to follow CDC guidelines to ensure the health and well-being of students and employees and faced increased costs associated with that. For example, the district purchased supplies such as sanitizer, masks, and sanitizing wipes, and it also used ESSER funds to hire additional custodians. The school district is also focusing on the physical security of buildings--replacing locks, adding enhanced security measures such as buzzers to get into the building, employee training, contracting with the Sheriff's Office to have a full-time dedicated School Resource Officer for each school.
3To address learning loss, the school district employs intervention specialists at both schools. The school district also offers both an after-school program and a summer school program. The school district also purchased subscriptions to programs such as Discovery Education, Nearpod, Flocabulary, and BrainPop, which students can use both in the classroom and at home.
Contacting the School District's Financial Management
This financial report is designed to provide our citizens, taxpayers, investors, and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional information, contact Nicole Price, Director of Finance, 1697 Pineville Road, Buena Vista, Georgia 31803. You may also email your questions to price.nicole@marion.k12.ga.us.
ix

Marion County Board of Education

MARION COUNTY BOARD OF EDUCATION
STATEMENT OF NET POSITION JUNE 30, 2022
ASSETS
Cash and cash equivalents Investments Receivables, net:
Taxes Intergovernmental:
State Federal Inventory Right to use assets (net of accumulated amortization) Capital assets (nondepreciable) Capital assets (net of accumulated depreciation) Total assets
DEFERRED OUTFLOWS OF RESOURCES
Related to pension plan Deferred loss on refunding Related to OPEB plan
Total deferred outflows of resources
LIABILITIES
Accounts payable Salaries and benefits payable Accrued interest payable Bonds payable due within one year Bonds payable due in more than one year Leases due within one year Leases due in more than one year Net pension liability, due in more than one year Net OPEB liability, due in more than one year
Total liabilities
DEFERRED INFLOWS OF RESOURCES
Related to pension plan Related to OPEB plan
Total deferred inflows of resources
NET POSITION
Net investment in capital assets Restricted for:
Bus replacement Continuation of federal programs Capital projects Debt service Unrestricted (deficit)
Total net position
The accompanying notes are an integral part of these financial statements.

EXHIBIT "A"

Governmental Activities

$

7,392,645

5,410,657

424,621

1,165,664 532,469 41,352 37,486 795,006
29,806,206 45,606,106

3,644,131 385,468
2,351,164 6,380,763

160,241 1,412,544
243,214 80,000
15,685,000 29,262 8,611
5,017,302 9,081,324 31,717,498

7,981,074 6,030,811 14,011,885

15,183,807

77,220

528,116

1,464,240

6,137,588

(17,133,485)

$

6,257,486

- 1 -

MARION COUNTY BOARD OF EDUCATION
STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED JUNE 30, 2022

EXHIBIT "B"

Functions/Programs Governmental activities:
Instruction Support services:
Pupil services Improvement of instructional
services Educational media services General administration School administration Business administration Maintenance and operation of plant Student transportation services Central support services Other support services Enterprise operations Food services operations Interest on long-term debt Total governmental activities

Expenses
$ 8,592,363
425,336
650,533 205,313 295,806 985,380 215,738 1,771,969 1,469,040 159,195
84,468 125,684 1,079,701 606,692 $ 16,667,218

Program Revenues

Operating

Capital

Charges for Grants and Grants and

Services

Contributions Contributions

Net (Expense) Revenue and
Changes in Net Position
Governmental Activities

$ 103,412 $ 8,343,897 $ 120,000 $ (25,054)

-

199,602

-

(225,734)

-

741,271

-

-

213,790

-

-

437,667

-

-

1,356,546

-

-

9,968

-

10,800

585,100

-

-

707,241

165,330

-

8,321

-

-

13,789

-

-

-

-

21,454

1,327,564

-

-

-

344,496

$ 135,666 $ 13,944,756 $ 629,826

90,738 8,477
141,861 371,166 (205,770) (1,176,069) (596,469) (150,874) (70,679) (125,684) 269,317 (262,196) (1,956,970)

General revenues: Taxes: Property taxes, levied for maintenance and operations Property taxes, levied for debt service Sales taxes, for debt service Intangible taxes Transfer taxes Railroad equipment tax Grants and contributions not restricted to specific programs Unrestricted investment earnings Miscellaneous Total general revenues Change in net position
Net position, beginning of year Net position, end of year

3,605,923 355,745 660,348 46,678 25,656 20,276
1,776,475 127,093 334,132
6,952,326 4,995,356 1,262,130 $ 6,257,486

The accompanying notes are an integral part of these financial statements.

- 2 -

MARION COUNTY BOARD OF EDUCATION
BALANCE SHEET GOVERNMENTAL FUNDS
JUNE 30, 2022

EXHIBIT "C"

ASSETS
Cash and cash equivalents Investments Receivables, net:
Taxes Intergovernmental:
State Federal Inventory
Total assets

General

Capital Projects

Debt Service

Total Governmental
Funds

$ 4,893,824 $ 1,464,240 $ 1,034,581 $

144,088

-

5,266,569

338,376

-

86,245

1,165,664

-

-

532,469

-

-

41,352

-

-

$ 7,115,773 $ 1,464,240 $ 6,387,395 $

7,392,645 5,410,657
424,621
1,165,664 532,469 41,352
14,967,408

LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES

LIABILITIES Accounts payable Salaries and benefits payable
Total liabilities

$

160,241 $

1,412,544

1,572,785

DEFERRED INFLOWS Unavailable revenue - property taxes
Total deferred inflows

102,998 102,998

FUND BALANCES Nonspendable:
Inventory Restricted:
Federal programs Bus replacement Capital projects Debt service Assigned: Student activities Subsequent years' budget Unassigned
Total fund balances

41,352
486,764 77,220
-
132,181 612,896 4,089,577 5,439,990

- $ -

- $ -

-

11,951

-

11,951

-
1,464,240 -
1,464,240

-
6,375,444
6,375,444

160,241 1,412,544 1,572,785
114,949 114,949
41,352
486,764 77,220
1,464,240 6,375,444
132,181 612,896 4,089,577 13,279,674

Total liabilities, deferred inflows and fund balances

$ 7,115,773 $ 1,464,240 $ 6,387,395 $ 14,967,408

The accompanying notes are an integral part of these financial statements.

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MARION COUNTY BOARD OF EDUCATION

EXHIBIT "D"

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET POSITION JUNE 30, 2022

Total fund balances - governmental funds
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets and right to use assets used in governmental activities are not financial resources and, therefore, are not reported in the funds.
Cost Less accumulated depreciation/amortization
Other long-term assets are not available to pay for current period expenditures and
Property taxes
Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the funds.
Bonds Deferred loss on refunding Leases Net pension liability Net OPEB liability Deferred outflows - pensions Deferred inflows - pensions Deferred outflows - OPEB Deferred inflows - OPEB Accrued interest
Net position of governmental activities

$ 13,279,674

$ 43,412,117 (12,773,419)

30,638,698

114,949

$ (15,765,000) 385,468 (37,873)
(5,017,302) (9,081,324) 3,644,131 (7,981,074) 2,351,164 (6,030,811)
(243,214)
$

(37,775,835) 6,257,486

The accompanying notes are an integral part of these financial statements.

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MARION COUNTY BOARD OF EDUCATION

EXHIBIT "E"

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022

General

Capital Projects

Debt Service

REVENUES Property taxes Sales taxes Other taxes State funds Federal funds Charges for services Investment earnings Miscellaneous Total revenues

$ 3,558,557 $ 64,726 20,276
10,160,947 5,754,655
135,666 414
330,528 20,025,769

- $ 350,387

-

667,956

-

-

-

-

-

344,496

-

-

-

126,679

-

-

-

1,489,518

EXPENDITURES Current: Instruction Support Services: Pupil services Improvement of instructional services Educational media services General administration School administration Business administration Maintenance and operation of plant Student transportation services Central support services Other support services Enterprise operations Food services operations Capital outlay Debt service: Principal retirement Interest and fees Total expenditures Excess of revenue over (under) expenditures

9,277,953
472,794 742,112 236,353 340,208 1,155,093 253,865 1,682,246 1,528,191 188,097
84,468 125,684 1,086,511 1,277,612
71,167 1,490
18,523,844 1,501,925

-
127,320 34,620 143,858
305,798 (305,798)

-
-
80,000 585,673 665,673 823,845

OTHER FINANCING SOURCES (USES)

Transfers in

-

1,200,000

-

Transfers out

(1,200,000)

-

-

Total other financing sources (uses)

(1,200,000)

1,200,000

-

Net change in fund balances

301,925

894,202

823,845

FUND BALANCES, beginning of year

5,138,065

570,038

5,551,599

FUND BALANCES, end of year

$ 5,439,990 $

1,464,240 $ 6,375,444

Total Governmental
Funds

$

3,908,944

732,682

20,276

10,160,947

6,099,151

135,666

127,093

330,528

21,515,287

9,277,953

472,794 742,112 236,353 340,208 1,155,093 253,865 1,809,566 1,562,811 188,097
84,468 125,684 1,086,511 1,421,470
151,167 587,163 19,495,315 2,019,972

1,200,000

(1,200,000)

-

2,019,972

11,259,702

$

13,279,674

The accompanying notes are an integral part of these financial statements.

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MARION COUNTY BOARD OF EDUCATION

EXHIBIT "F"

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, 2022

Amounts reported for governmental activities in the statement of activities are different because:

Net change in fund balances - total governmental funds

$ 2,019,972

Governmental funds report capital outlays as expenditures. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. The net effect of the amount by which capital outlay exceeded depreciation and amortization is to increase net position.

Capital outlay Amortization expense Depreciation expense

$ 1,723,066 (29,567)
(954,842)

738,657

Capital assets purchased for the School District by the Marion County Board of Commissioners, are not reported in the governmental funds. However, in the Statement of Activities, the donated assets are shown as capital grants and contributions

120,000

Net effect of various miscellaneous transactions involving capital assets (sales, trade-ins, donations, etc.) is to decrease net position.
Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds.

(336,447)

Property taxes

52,724

Issuance of long-term debt provides current financial resources to governmental funds, while repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. This amount is the net effect of these differences in the treatment of long-term debt and related
Principal payments - leases Principal payments - financed purchases Principal payments - bonds Adjustments related to pensions Adjustments related to OPEB Amortization of deferred loss on refunding

$ 369,231 41,987 80,000
1,534,209 394,552 (21,768)

Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds.

2,398,211

Change in accrued interest

2,239 $ 4,995,356

The accompanying notes are an integral part of these financial statements.

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MARION COUNTY BOARD OF EDUCATION
STATEMENT OF FIDUCIARY NET POSITION CUSTODIAL FUND JUNE 30, 2022
ASSETS Cash Investments
Total assets NET POSITION
Restricted for students and student organizations

EXHIBIT "G"

Custodial Fund

$

3,157

30,430

$

33,587

$

33,587

The accompanying notes are an integral part of these financial statements.

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MARION COUNTY BOARD OF EDUCATION
STATEMENT OF CHANGE IN FIDUCIARY NET POSITION CUSTODIAL FUND JUNE 30, 2022

EXHIBIT "H"

Local sources Investment earnings
Total additions
Collections disbursed Change in net position
Net position, beginning of year Net position, end of year

ADDITIONS DEDUCTIONS NET POSITION

Custodial Fund

$

2,387

77

2,464

2,117 347

33,240

$

33,587

The accompanying notes are an integral part of these financial statements.

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
REPORTING ENTITY
The Marion County Board of Education (the "School District") was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles ("GAAP") as prescribed by the Governmental Accounting Standards Board ("GASB"). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below.
BASIS OF PRESENTATION
The School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness.
Government-Wide Statements
The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non-exchange transactions.
The Statement of Net Position presents the School District's non-fiduciary assets and liabilities, with the difference reported as net position. Net position is reported in three categories as follows:
1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation/amortization, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets.
2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation.

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION (CONTINUED)
Government-Wide Statements (Continued)
3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities.
Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs.
Program revenues include: a) charges paid by the recipients of goods or services offered by the programs, and b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
Fund Financial Statements
The fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate statements are presented for governmental and fiduciary funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column.
The School District reports the following major governmental funds:
The General Fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund.
The Capital Projects Fund accounts for and reports financial resources including the Education Special Purpose Local Option Sales Tax ("ESPLOST") bond proceeds, and grants from the Georgia State Financing and Investment Commission that are restricted, committed, or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets.
The Debt Service Fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes (property and sales) legally restricted for the payment of general long-term principal and interest.

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION (CONTINUED)
Fund Financial Statements (Continued)
The School District reports the following fiduciary fund type:
Custodial Fund is used to report resources held by the School District in a purely custodial capacity.
Basis of Accounting
The basis of accounting determines when transactions are reported in the financial statements. The government-wide and fiduciary fund 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 at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, grants, and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within 60 days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes, and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under leases are reported as other financing sources.
The School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net position available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues.
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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION (CONTINUED)
Basis of Accounting (Continued)
The State of Georgia reimburses the School District for teachers' salaries and operating costs through the Quality Basic Education ("QBE") Formula Earnings program. State of Georgia law defines the formula driven grant that determines the cost of an academic school year and the State of Georgia's share in this cost. Generally, teachers are contracted for the school year (July 1 June 30) and paid over a 12-month contract period, generally September 1 through August 31. In accordance with the requirements of the enabling legislation of the QBE program, the State of Georgia reimburses the School District over the same 12-month period in which teachers are paid, funding the academic school year expenditures. At June 30, the amount of teachers' salaries incurred but not paid until July and August of the subsequent year are accrued as the State of Georgia has only postponed the final payment of their share of the cost until the subsequent appropriations for cash management purposes. By June 30 of each year, the State of Georgia has a signed appropriation that includes this final amount, which represents the State of Georgia's intent to fund this final payment. Based on guidance in GASB Statement No. 33, paragraph 74, the State of Georgia recognizes its QBE liability for the July and August salaries at June 30, and the School System recognizes the same QBE as a receivable and revenue, consistent with symmetrical recognition.
New Accounting Pronouncements
In fiscal year 2022, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 87, Leases. The primary objective of this statement is to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments. This statement increases the usefulness of the government's financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. The beginning balances for intangible right to use assets and long-term liabilities were restated for the effect of GASB Statement No. 87.
Cash and Cash Equivalents
Composition of Deposits Cash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia's local government investment pool ("Georgia Fund 1"), and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. The Official Code of Georgia Annotated ("O.C.G.A.") 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured federal savings and loan associations, or insured chartered building and loan associations.

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION (CONTINUED)
Investments
Composition of Investments The School District can invest its funds as permitted by O.C.G.A. 36-83-4.
In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity.
The School District does not have a formal policy regarding investment policies that address credit risks, custodial credit risks, concentration of credit risks, interest rate risks or foreign currency risks.
Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value.
For accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired.
Receivables
Receivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
Inventories
Food Inventories On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their federally assigned value and purchased food inventories are reported at cost (first-in/first-out basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used.

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

BASIS OF PRESENTATION (CONTINUED)

Capital Assets
On the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art.

Capital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements.

Depreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives.

Capitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows:

Land Construction in Progress Land Improvements Buildings and Improvements Equipment Intangible Assets

Capitalization Policy
All All $ 5,000 5,000 5,000 100,000

Estimated Useful Life
N/A N/A 15 to 80 Years 10 to 80 Years 5 to 14 Years 15 to 80 Years

Intangible Right to Use Assets
Leases, as a lessee, are included in intangible right to use assets and lease obligations on the Statement of Net Position. An intangible right to use asset represents the School District's right to use an underlying asset for the lease term. Lease obligations represent the School District's liability to make lease payments arising from lease agreement. Intangible right to use assets and lease obligations are recognized on the present value of lease payments over the lease term, where the initial term exceeds 12 months. Residual value guarantees and the value of an option to exceed or terminate a lease are reflected to the extent it is reasonably certain to be paid or exercised. Variable payments based on future performance or usage are not included in the measurement of the lease liability. Intangible right to use assets are amortized using a straight-line basis over the shorter of the lease term or the useful life of the underlying asset.

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

BASIS OF PRESENTATION (CONTINUED)

Intangible Right to Use Assets (Continued)
Capitalization thresholds of intangible right to use assets reported in the government-wide statements are as follows:

Capitalization Policy

Land Land Improvements Buildings and Improvements Equipment
Deferred Outflows/Inflows of Resources

All $ 5,000
5,000 5,000

In addition to assets, the statement of financial position and/or balance sheet will sometimes report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and, therefore, will not be recognized as an outflow of resources (expense/expenditure) until then.

In addition to liabilities, the statement of financial position and/or balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and, therefore, will not be recognized as an inflow of resources (revenue) until that time.

Long-Term Liabilities and Bond Discounts/Premiums

In the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the straight-line method. To conform to generally accepted accounting principles, bond premiums and discounts should be amortized using the effective interest method. The effect of this deviation is deemed to be immaterial to the fair presentation of the basic financial statements. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued.

In the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as business administration expenditures.

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION (CONTINUED)
Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. 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.
Post-employment Benefits Other Than Pensions ("OPEB")
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees' Post-employment Benefit Fund ("School OPEB Fund"), and additions to/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
Fund Balance
Fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent.
The School District's fund balances are classified as follows:
Non-spendable consists of resources that cannot be spent, either because they are in a non-spendable form or because they are legally or contractually required to be maintained intact.
Restricted consists of resources that can be used only for specific purposes pursuant to constraints, either: 1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments, or 2) imposed by law through constitutional provisions or enabling legislation.
Committed consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decision-making authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.
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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION (CONTINUED)
Fund Balance
Assigned consists of resources constrained by the School District's intent to be used for specific purposes but are neither restricted nor committed. The intent should be expressed by: 1) the Board, or 2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes.

Unassigned consists of resources within the General Fund not meeting the definition of any aforementioned category. The General Fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance.

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.
Property Taxes

The Marion County Board of Commissioners adopted the property tax levy for the 2021 tax digest year (calendar year) on October 21, 2021 (levy date), based on property values as of January 1, 2021. Taxes were due on February 16, 2022 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2021 tax digest are reported as revenue in the governmental funds for fiscal year 2022. The Marion County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2022, for maintenance and operations and debt service, amounted to $3,151,976 and $350,387, respectively.

The tax millage rates levied for the 2021 tax year (calendar year) for the School District were as follows (one mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds
Total

14.981 mills 1.761 mills
16.742 mills

Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2022, for maintenance and operations, amounted to $406,581.

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION (CONTINUED)
Sales Taxes
ESPLOST, at the fund reporting level, during the year amounted to $660,348 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be reauthorized at least every five years.
NOTE 3: BUDGETARY DATA
The budget is a complete financial plan for the School District's fiscal year, and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the General, Debt Service, and Capital Projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds, except the various school activity (principal) accounts, is prepared and adopted by fund. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the General Fund was prepared in accordance with accounting principles generally accepted in the United States of America.
The budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
The Superintendent is authorized by the Board to approve adjustments of no more than 5% of the amount budgeted for expenditures in any budget function for any fund. The Superintendent shall report any such adjustments to the Board. If expenditure of funds in any fund is anticipated to be more than 5% of the budgeted amount, the Superintendent shall request Board approval for the budget amendment. Any position or expenditure not previously approved in the annual budget that exceeds $100,000 shall require Board approval unless the Superintendent deems the position or purchase an emergency. In such case, the expenditure shall be reported to the Board at its regularly scheduled meeting. Under no circumstances is the Superintendent or other staff person authorized to spend funds that exceed the total budget without approval by the Board.
See the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review.
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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 4: DEPOSITS AND INVESTMENTS
Collateralization of Deposits O.C.G.A. 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to and not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. 45-8-13.1), the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance.
Acceptable security for deposits consists of any one of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, (3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of
the State of Georgia, (4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or
municipalities of the State of Georgia, (5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute
that created the authority authorized the use of the bonds for this purpose, (6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of
Georgia, and (7) Bonds, bills, notes, certificates of indebtedness or other obligations of a subsidiary corporation of
the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
Categorization of Deposits Custodial credit risk is the risk that in the event of bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2022, the School District had deposits with a carrying value of $7,570,324 and bank balances were $7,985,972, which include $174,518 classified as certificates of deposit. The bank balances insured by Federal depository insurance were $494,304.
At June 30, 2022, $7,491,668 of the School District's bank balance was exposed to custodial credit risk and included in the State's Secure Deposit Program.
The School District participates in the State's Secure Deposit Program ("SDP"), a multi-bank pledging pool. The SDP requires participating banks that accept public deposits in Georgia to operate under the policy and procedures of the program. The Georgia Office of the State Treasurer ("OST") sets the collateral requirements and pledging level for each covered depository. There are four tiers of collateralization levels specifying percentages of eligible securities to secure covered deposits, 25%, 50%, 75%, and 110%. The
- 20 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 4: DEPOSITS AND INVESTMENTS (CONTINUED)

Categorization of Deposits (Continued)

SDP also provides for collateral levels to be increased to the amount of up to 125% if economic or financial conditions warrant. The program lists the type of eligible collateral. The OST approves authorized custodians.
In accordance with the SDP, if a covered depository defaults, losses to public depositors are first satisfied with any applicable insurance, followed by demands of payment under any letters of credit or sale of the covered depository's collateral. If necessary, any remaining losses are to be satisfied by assessment made against the other participating covered depositories. Therefore, for disclosure purposes, all deposits of the SDP are considered to be fully collateralized.

Reconciliation of cash and cash equivalents balance to carrying value of deposits:

Cash and cash equivalents Statement of Net Position Statement of Fiduciary Net Position
Total cash and cash equivalents

$ 7,392,649 3,157
7,395,806

Add: Deposits with original maturity of three months or more reported as investments Total carrying value of deposits June 30, 2022

174,518 $ 7,570,324

Categorization of Investments At June 30, 2022, the School District had the following investments:

Investment Ameris Bank Certificate of Deposit Ameris Bank Certificate of Deposit Deutsche Bank repurchase Fidelity Institutional Government
(money market mutual fund)
*Rating as per Standard & Poor's

Maturities May 14, 2023 February 1, 2023 January 28, 2007
28-day weighted average

Rating*

Fair Value

N/A $

- $

N/A

-

N/A

-

Cost-Based 30,430
144,088 4,418,156

AAAm $

848,413 848,413 $

4,592,674

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 4: DEPOSITS AND INVESTMENTS (CONTINUED)
Fair Value Measurements The School District measures and records its investments using fair value measurement guidelines established by generally accepted accounting principles. These guidelines recognize a three-tiered fair value hierarchy, as follows:
Level 1: Quoted prices for identical investments in active markets; Level 2: Observable inputs other than quoted market prices; and Level 3: Unobservable inputs.
Fidelity Institutional Government (money market mutual fund) investments are valued at Level 1.
Interest Rate Risk Interest rate risk is the risk that changes in interest rates of debt investments will adversely affect the fair value of an investment. The School District does not have a formal policy for managing interest rate risk.
Custodial Credit Risk Custodial credit risk for investments is the risk that, in the event of the failure of the counterparty to a transaction, the School District will not be able to recover the value of the investment or collateral securities that are in the possession of an outside party. The School District does not have a formal policy for managing custodial credit risk.
As of June 30, 2022, $5,266,569 of the School District's applicable investments were held by the investment's counterparty, not in the School District's name.
Credit Quality Risk Credit quality risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. State law limits investments to those prescribed by O.C.G.A. 36-83-4. The School District does not have a formal policy that would further limit its investment choices or one that addresses credit risk.
Concentration of Credit Risk Concentration of credit risk is the risk of loss attributed to the magnitude of a government's investment in a single issuer. The School District does not have a formal policy for managing concentration of credit risk. More than 5% of the School District's investments are in the Fidelity Institutional Government Money Market Mutual Fund and the Deutsche Bank repurchase. The repurchase agreement represents 81% of the School District's total investments and the Money Market Mutual Fund represents 16% of the School District's total investments.
NOTE 5: NON-MONETARY TRANSACTIONS
The School District receives food commodities from the United States Department of Agriculture ("USDA") for school breakfast and lunch programs. These commodities are recorded at their federally assigned value. See Note 2 Inventories.

- 22 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 6: CAPITAL ASSETS AND INTANGIBLE RIGHT TO USE ASSETS The following is a summary of changes in the capital assets of governmental activities during the fiscal year:

Beginning Balance

Increases Decreases Transfers

Ending Balance

Governmental activities:

Capital assets, not being depreciated:

Land

$

Construction in progress

Total

581,159 $

- $

50,380 1,486,421

631,539 1,486,421

- $

- $

-

(1,322,954)

-

(1,322,954)

581,159 213,847 795,006

Capital assets, being depreciated: Buildings and improvements Equipment Land improvements Total

35,731,459 3,773,879 1,760,941 41,266,279

49,200 240,448 66,997 356,645

(395,820) (395,820)

1,322,954 -
1,322,954

37,103,613 4,014,327 1,432,118 42,550,058

Less accumulated depreciation for: Buildings and improvements Equipment Land improvements Total

(8,061,896)
(2,717,150) (1,069,337) (11,848,383)

(668,403)
(241,485) (44,954) (954,842)

-
59,373 59,373

-

(8,730,299)

-

(2,958,635)

-

(1,054,918)

- (12,743,852)

Total capital assets, being depreciated, net

29,417,896

(598,197) (336,447)

1,322,954

29,806,206

Governmental activities capital assets, net

$ 30,049,435 $ 888,224 $ (336,447) $

- $ 30,601,212

Current year depreciation expense by function is as follows:

Instruction Support Services
Improvement of Instructional Services School Administration Maintenance and Operations Student Transportation Food Services

$ 690,890

$ 4,266 10,816 41,433
166,310

222,825 41,127

Total Depreciation Expense

$ 954,842

- 23 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 6: CAPITAL ASSETS AND INTANGIBLE RIGHT TO USE ASSETS (CONTINUED)

The following is a summary of the changes in the intangible right to use assets for governmental activities during the year:

Begi nni ng Bal ance
(Restated)

Increases Decrease

Endi ng Bal ance

Governmental activities: Intangible right to use assets
Equipment Total
Less accumulated amortization for: Equipment Total
Governmental activities Intangible right to use assets, net

$ 67,053 $ 67,053

-$ -

-

(29,567)

-

(29,567)

$ 67,053 $ (29,567) $

- $ 67,053

-

67,053

-

(29,567)

-

(29,567)

- $ 37,486

Current year amortization expense by function is as follows:

Instruction Support Services
Pupil Services Educational Media Services General Administration School Administration
Total Amortization Expense

$ 1,431 2,862 2,225 4,449

$ 18,600
$ 10,967 $ 29,567

- 24 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 7: LEASES

For the year ended June 30, 2022, the financial statements include the adoption of GASB Statement No. 87, Leases. The primary objective of this statement is to enhance the relevance and consistency of information about governments' leasing activities. This statement establishes a single model for lease accounting based on the principle that leases are financings of the right to use an underlying asset. Under this statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources. For additional information, refer to the disclosures below.

On July 1, 2021, the School District entered into a 25 month lease as lessee for the use of a copier. An initial lease liability was recorded in the amount of $58,287. As of June 30, 2022, the value of the lease liability is $31,426. The School District is required to make monthly fixed payments of $2,249. The lease has an interest rate of 0.3080%. The equipment's estimated useful life was 0 months as of the contract commencement. The value of the right to use asset as of June 30, 2022 of $58,287 with accumulated amortization of $27,287 is included with equipment in the leased asset table below.

On July 1, 2021, the School District entered into a 46 month lease as lessee for the use of a postage machine. An initial lease liability was recorded in the amount of $2,922. As of June 30, 2022, the value of the lease liability is $2,149. The School District is required to make quarterly fixed payments of $197. The lease has an interest rate of 0.5600%. The equipment's estimated useful life was 0 months as of the contract commencement. The value of the right to use asset as of June 30, 2022 of $2,922 with accumulated amortization of $760 is included with equipment in the leased asset table below.

On July 1, 2021, the School District entered into a 46-month lease as lessee for the use of a postage machine. An initial lease liability was recorded in the amount of $2,922. As of June 30, 2022, the value of the lease liability is $2,149. The School District is required to make quarterly fixed payments of $197. The lease has an interest rate of 0.5600%. The equipment's estimated useful life was 0 months as of the contract commencement. The value of the right to use asset as of June 30, 2022 of $2,922 with accumulated amortization of $760 is included with equipment in the leased asset table below.

On July 1, 2021, the School District entered into a 46-month lease as lessee for the use a postage machine. An initial lease liability was recorded in the amount of $2,922. As of June 30, 2022, the value of the lease liability is $2,149. The School District is required to make quarterly fixed payments of $197. The lease has an interest rate of 0.5600%. The equipment's estimated useful life was 0 months as of the contract commencement. The value of the right to use asset as of June 30, 2022 of $2,922 with accumulated amortization of $760 is included with equipment in the leased asset table below.

Equipment Less: Accumulated Amortization

Governmental

Activities

$

67,053

(29,567)

$

37,486

- 25 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 7: LEASES (CONTINUED)

Principal and interest requirements to maturity for the lease liability as of June 30, 2022 are as follows:

Fiscal Year Ending June 30,

Principal

Interest

2023 2024 2025
Total Principal and Interest

$

29,262 $

90

6,842

20

1,769

5

$

37,873 $

115

NOTE 8: INTERFUND TRANSFERS

Interfund transfers for the year ended June 30, 2022 consisted of the following:

Transfers To Capital Projects Fund

Transfers From General Fund
$ 1,200,000

Transfers are used to move property tax revenues collected by the General Fund to the Capital Projects Fund as a required match or supplemental funding source for capital construction projects.

- 26 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 9: LONG-TERM LIABILITIES

Changes in Long-term Liabilities

The changes in long-term liabilities during the fiscal year ended June 30, 2022, for governmental activities, were as follows:

Restated Beginning Balance

Increases Decreases

Ending Balance

Due Within One Year

Qualified School

Construction Bonds $

General Obligation Bonds

Leases

Financed Purchases

Net Pension Liability

Net OPEB Liability

Total

$

7,595,000 $ 8,250,000
407,104 41,987 13,992,702 12,734,651 43,021,444 $

630,783 630,783

$

- $

(80,000)

(369,231)

(41,987)

(9,606,183)

(3,653,327)

$ (13,750,728) $

7,595,000 $

-

8,170,000

80,000

37,873

29,262

-

-

5,017,302

-

9,081,324

-

29,901,499 $ 109,262

General Obligation Debt Outstanding
The School District's bonded debt consists of various issues of general obligation bonds that are generally callable with interest payable semi-annually. Bond proceeds primarily pay for acquiring or constructing capital facilities. Bonds have also been issued to advance-refund previously issued bonds. The School District repays general obligation bonds from voter-approved property and sales taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District.

- 27 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 9: LONG-TERM LIABILITIES (CONTINUED)
General Obligation Debt Outstanding (Continued)
The School District had no unused line of credit or outstanding notes from direct borrowings and direct placements related to governmental activities as of June 30, 2022. In the event the entity is unable to make the principal and interest payments using proceeds from the ESPLOST, the debt will be satisfied from a direct annual ad valorem tax levied upon all taxable property within the School District. Additional security is provided by the State of Georgia Intercept Program which allows for state appropriations entitled to the School District to be transferred to the Debt Service account custodian for the payment of debt.

During fiscal year 2020, the School District issued $8,310,000 in general obligation refunding bonds to advance the refund of $7,715,000 of the 2010C Series Bonds. The bond issue of $8,310,000 less underwriters and estimated bond issue cost of $165,996, provided net proceeds of $8,144,004. The total net proceeds of $8,144,004 were deposited in an irrevocable trust with an escrow agent to provide for future debt service payments on portions of the 2010C bond issues. As a result, the 2010C Series Bonds are considered defeased and the liability has been removed from the Government-wide Statement of Net Position.
General obligation bonds currently outstanding are as follows:

Purpose Refunding Bond Series 2020

Interest Rate
2.45%

Issue Date April 17, 2020

Maturity Date

Amount Issued

February 1, 2040 $ 8,310,000

Amount Outstanding
$ 8,170,000

The following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable:

Fiscal Year Ending June 30,
2023 2024 2025 2026 2027 2028 - 2032 2033 - 2037 2038 - 2040
Total Principal and Interest

Pri nci pal
$ 80,000 80,000 85,000 85,000 90,000
2,750,000 3,030,000 1,970,000
$ 8,170,000

Interest
$ 200,165 198,205 196,245 194,163 192,080 818,300 467,214 97,143
$ 2,363,515

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MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 9: LONG-TERM LIABILITIES (CONTINUED)

Qualified School Construction Bonds ("QSCB")
Section 1521 of the American Recovery and Reinvestment Act ("ARRA") of 2009 QSCB provides for a source of capital at no or at nominal interest rates for costs incurred by the School Districts in connection with the construction, rehabilitation or repair of a public school facility or for the acquisition of land where a school will be built. Investors receive Federal income tax credits at prescribed tax credit rates in lieu of interest, which essentially allows school districts to borrow without incurring interest costs.
When the stated interest rate on the QSCB results in interest payments that exceed the supplemental interest payments discussed in the preceding paragraph, the School District may apply for a direct cash subsidy payment from the U.S. Treasury which is intended to reduce the stated interest rate to a nominal percentage. To qualify for this subsidy, the School District is required to periodically file appropriate documents with the Internal Revenue Service. These subsidy payments do not include the amount of any supplemental interest paid on a QSCB. The interest subsidy received by the School District in fiscal year 2022 was $344,496, which funded all but $39,052 of interest expense due on the QSCB.

In the event the amount of funds lawfully available is not sufficient to pay the QSCB payments when due in any year, the School District shall levy an ad valorem tax on all taxable property located within the boundaries of the School District subject to taxation for such purposes, at such rate or rates as may be necessary to produce in each calendar year, revenues which shall be sufficient to fulfill the School District's obligations. Additionally, the State Board is authorized and directed to withhold from any state appropriations to which the School District may be entitled and apply so much thereof as shall be necessary to the payment of the principal and interest on such indebtedness then due.

Debt currently outstanding QSCB are as follows:

Purpose QSCB - Series 2010B

Interest 5.05%

Issue Date

Maturity Date

Amount Issued

September 2, 2010 February 1, 2027 $ 7,595,000

Amount Outstanding
$ 7,595,000

The following is a schedule of total QSCB payments:
Fiscal Year Ending June 30,
2023 2024 2025 2026 2027 Total Principal and Interest

Principal

$

-

-

-

-

7,595,000

$ 7,595,000

Interest
$ 383,548 383,548 383,548 383,548 383,548
$ 1,917,740

- 29 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 10: RISK MANAGEMENT

The School District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors or omissions; and job related illness or injuries to employees and natural disasters. Except as described below, the School District carries commercial insurance for these risks. Settled claims resulting from these insured risks have not exceeded commercial insurance coverage in any of the past three fiscal years.

The School District has elected to self-insure for all potential losses of property related to natural disasters. The School District has not experienced any losses related to this risk in the past three years.

The School District has purchased additional insurance coverage for all employees and board members in the amount of $250,000 for dishonesty, and $250,000 for forgery, alterations, theft, disappearance, destruction, and robbery.

The School District has purchased surety bonds to provide additional insurance coverage as follows:

Position Covered Superintendent Board Chair
NOTE 11: SIGNIFICANT CONTINGENT LIABILITIES

Amount

$

50,000

12,000

Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position.

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB)

Georgia School Personnel Post-Employment Health Benefit Fund
Plan Description. Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A). are provided OPEB through the School OPEB Fund a cost-sharing multiple-employer defined benefit post-employment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (the "Board"). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board.

- 30 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB) (CONTINUED)
Georgia School Personnel Post-Employment Health Benefit Fund (Continued)
Benefits Provided. The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from the Employees' Retirement System ("ERS"), Georgia Judicial Retirement System ("JRS"), Legislative Retirement System ("LRS"), Teachers' Retirement System ("TRS") or Public School Employees' Retirement System ("PSERS"). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered standard and premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement ("HRA"), Health Maintenance Organization ("HMO") and a High Deductible Health Plan ("HDHP"). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted.
Contributions. As established by the Board, the School OPEB Fund is substantially funded on a pay-as-yougo basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $294,518 for the year ended June 30, 2022. Active employees are not required to contribute to the School OPEB Fund.
OPEB Liabilities, OPEB Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
At June 30, 2022, the School District reported a liability of $9,081,324 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2021. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2020. An expected total OPEB liability as of June 30, 2021, was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2021. At June 30, 2021, the School District's proportion was 0.083847%, which was a decrease of 0.002856% from its proportion measured as of June 30, 2020.

- 31 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB) (CONTINUED)

OPEB Liabilities, OPEB Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB (Continued)

For the year ended June 30, 2022, the School District recognized OPEB expense of ($100,141). At June 30, 2022, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Differences between expected and actual experience
Changes in assumptions
Net difference between projected and actual earnings on OPEB plan investments
Changes in proportion and differences between School District contributions and proportianate share of contributions
School District contributions subsequent to the measurement date
Total

OPEB

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

$

- $ 4,146,504

1,662,930

741,030

-

14,400

393,716

1,128,877

294,518 $ 2,351,164

$ 6,030,811

School District contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Fiscal Year Ending June 30,
2023 2024 2025 2026 2027 2028

OPEB
$ (883,932) (878,993) (791,946) (627,713) (621,595) (169,986)

- 32 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB) (CONTINUED)

OPEB Liabilities, OPEB Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB (Continued)

Actuarial assumptions. The total OPEB liability as of June 30, 2021, was determined by an actuarial valuation as of June 30, 2020 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2021:

OPEB:

Inflation Salary increases Long-term expected rate of return
Healthcare cost trend rate Pre-Medicare Eligible Medicare Eligible
Ultimate trend rate Pre-Medicare Eligible Medicare Eligible
Year of Ultimate trend rate

2.50% 3.00% 8.75%, including inflation
7.00%, compounded annually, net of investment expense, and including inflation
6.75% 5.13%
4.50% 4.50%

Pre-Medicare Eligible Medicare Eligible

2029 2023

Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, as follows:

For TRS members: Post-retirement mortality rates for service retirements and beneficiaries were based on the Pub-2010 Teachers Headcount Weighted Below Median Healthy Retiree Mortality Table (ages set forward one year and adjusted 106%) with the MP-2019 projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. Post retirement mortality rates for disability retirements were based on the Pub-2010 Teachers' Mortality Table for Disabled Retirees (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all year prior to the ultimate rate. The Pub-2010 Techers Headcount Weighted Below Median Employee mortality table with ages set forward one year and adjusted 106% was used for death prior to retirement. Future improvement in mortality rates was assumed using the MP-2019 projection scale generationally. These rates of improvement were reduced by 20% for all years prior to the ultimate rate.

- 33 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB) (CONTINUED)
OPEB Liabilities, OPEB Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB (Continued)
Actuarial assumptions (Continued)
For PSERS members: Pre-retirement mortality rates were based on the Pub-2010 General Employee Mortality Table, with no adjustment, with the MP-2019 Projections scale applied generationally. Post-retirement mortality rates for service retirements were based on the Pub-2010 General Healthy Annuitant Mortality Table (ages set forward one year and adjusted 105% for males and 108% for females) with the MP-2019 Projection scale applied generationally. Post- retirement mortality rates for disability retirements were based on the Pub-2010 General Disabled Mortality Table (ages set back three years for males and adjusted 103% for males and 106% for females) with the MP-2019 Projections scaled applied generationally. Post-retirement mortality rates for beneficiaries were based on the Pub-2010 General Contingent Survivor Mortality Table (ages set forward two years and adjust 106% for males and 158% for females) with the MP-2019 Project scale applied generationally.
The actuarial assumptions used in the June 30, 2020 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2018, with the exception of the assumed annual rate of inflation which was changed from 2.75% to 2.50%, effective with the June 30, 2018 valuation.
The remaining actuarial assumptions (e.g., initial per capita costs, healthcare cost trends, rate of plan participation, rates of plan election, etc.) used in the June 30, 2020 valuation were based on a review of recent plan experience done concurrently with the June 30, 2020 valuation.
Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation.

- 34 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB) (CONTINUED)

OPEB Liabilities, OPEB Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB (Continued)

Actuarial assumptions (Continued)

The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset Class Fixed income Equities

Total

Target Al l ocati on
30.00% 70.00% 100.00%

Long-Term Expected Real Rate of Return*
0.14% 9.20%

*Net of Inflation
Discount rate: In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 2.20% was used as the discount rate, as compared with last year's rate of 2.22%. This is comprised mainly of the yield or index rate for 20-year tax-exempt general obligation bonds with an average rating of AA or higher (2.16% per the Municipal Bond Index Rate). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2145.

- 35 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB) (CONTINUED)

OPEB Liabilities, OPEB Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB (Continued)

Sensitivity of the School District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 2.20%, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (1.20%) or 1percentage-point higher (3.20%) than the current discount rate:

School District's proportionate share of the net OPEB liablity

1% Decrease (1.20%)

Current Discount Rate
(2.20%)

1% Increase (3.20%)

$ 10,381,990 $ 9,081,324 $ 7,992,543

Sensitivity of the School District's proportionate share of the net OPEB liability to changes in the healthcare cost trend rates. The following presents the School District's proportionate share of the net OPEB liability, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage-point lower or 1-percentage-point higher than the current healthcare cost trend rates:

School District's proportionate share of the net OPEB liablity

1% Decrease

Current Healthcare Cost Trend Rate

1% Increase

$ 7,705,855 $ 9,081,324 $10,800,767

OPEB plan fiduciary net position. Detailed information about the OPEB plan's fiduciary net position is available in the Annual Comprehensive Financial Report which is publicly available at https://sao.georgia.gov/statewide-reporting/acfr.

- 36 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 13: RETIREMENT PLANS
The School District participates in various retirement plans administered by the State of Georgia as further explained below:
Teachers Retirement System of Georgia ("TRS")
Plan Description. All teachers of the School District as defined in 47-3-60 of the O.C.G.A. and certain other support personnel as defined by O.C.G.A. 47-3-63 are provided a pension through the TRS. TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees ("TRS Board"). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial audit report that can be obtained at www.trsga.com/publications.
Benefits Provided. TRS provides service retirement, disability retirement and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after ten years of service and attainment of age 60. Eligibility for disability and death benefits requires ten years of service. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.
Contributions. Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2022. The School District's contractually required contribution rate for the year ended June 30, 2022, was 19.81% of annual School District payroll. The current year contribution was $1,474,339.
Public School Employees Retirement System ("PSERS")
Plan Description. PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the TRS. The ERS Board of Trustees, plus two additional trustees, administer PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/financials.
Benefits Provided. A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service.
- 37 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 13: RETIREMENT PLANS (CONTINUED)
Public School Employees Retirement System ("PSERS") (Continued)
Benefits Provided (Continued). Upon retirement, the member will receive a monthly benefit of $15.50, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits.
Contributions. The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.
Individuals who became members prior to July 1, 2012, contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012, contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $29,321.
Pension Liabilities, Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions
At June 30, 2022, the School District reported a liability of $5,017,302 for its proportionate share of the net pension liability for TRS.
The net pension liability for TRS was measured as of June 30, 2021. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2020. An expected total pension liability as of June 30, 2021, was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS during the fiscal year ended June 30, 2021.
At June 30, 2021, the School District's TRS proportion was 0.056729%, which was a decrease of 0.001035% from its proportion measured as of June 30, 2020.
At June 30, 2022, the School District did not have a PSERS liability for a proportionate share of the Net Pension Liability because of a special funding situation with the State of Georgia, which is responsible for the Net Pension Liability of the plan. The amount of the State's proportionate share of the Net Pension Liability associated with the School District is $26,607.
- 38 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 13: RETIREMENT PLANS (CONTINUED)
Pension Liabilities, Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued)

The PSERS net pension liability was measured as of June 30, 2021. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2020. An expected total pension liability as of June 30, 2021, was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State of Georgia during the fiscal year ended June 30, 2021.

For the year ended June 30, 2022, the School District recognized pension expense of ($59,870) for TRS, $280 for PSERS and revenue of $280 for PSERS. The revenue is support provided by the State of Georgia.

At June 30, 2022, the School District reported deferred outflows of resources and deferred inflows of resources related to pension from the following sources:

Differences between expected and actual experience Changes in assumptions Net difference between projected and actual earnings on pension plan investments Changes in proportion and differences between School District contributions and proportionate share of contributions School District contributions subsequent to the measurement Total

TRS

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

$ 1,197,288 $

-

971,082

-

-

7,338,895

1,422 1,474,339 $ 3,644,131

642,179 -
$ 7,981,074

- 39 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 13: RETIREMENT PLANS (CONTINUED)

Pension Liabilities, Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued)

School District contributions subsequent to the measurement date for TRS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ending June 30, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Fiscal Year Ending June 30,
2023 2024 2025 2026 Thereafter

TRS $ (1,219,803)
(1,180,493) (1,570,553) (1,840,433)
-

Actuarial Assumptions: The total pension liability as of June 30, 2021, was determined by an actuarial valuation as of June 30, 2020, using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers Retirement System

Inflation Salary increases Investment rate of return
Post-retirement benefit increases

2.50% 3.00 8.75%, average, including inflation 7.25%, net of pension plan investment expense,
including inflation 1.50% semi-annually

Post-retirement mortality rates for service retirements and beneficiaries were based on the Pub-2010 Teachers Headcount Weighted Below Median Healthy Retiree mortality table (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. Post-retirement mortality rates for disability retirements were based on the Pub-2010 Teachers Mortality Table for Disabled Retirees (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. The Pub-2010 Teachers Headcount Weighted Below Median Employee mortality table with ages set forward one year and adjusted 106% as used for death prior to retirement. Future improvement in mortality rates was assumed using the MP-2019 projection scale generationally. These rates of improvement were reduced by 20% for all years prior to the ultimate rate.

The actuarial assumptions used in the June 30, 2020 valuation were based on the results of an actuarial experience study for the period July 1, 2013 June 30, 2018.

- 40 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 13: RETIREMENT PLANS (CONTINUED)

Pension Liabilities, Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued)

Public School Employees Retirement System

Inflation Salary increases Investment rate of return
Post-retirement benefit increases

2.50% N/A 7.00%, net of pension plan investment expense,
including inflation 1.50% semi-annually

Mortality rates are as follows:

The Pub-2010 General Employee Table, with no adjustments, projected generationally with the MP-2019 scale is used for both males and females while in active service.
The Pub-2010 Family of Tables projected generationally with the MP-2019 scale and with further adjustments are used for post-retirement mortality assumptions as follows:

Participant Type Membership Table

Set Forward (+)/ Set Back (-)

Adjustment to Rates

Service Retirees
Disability Retirees Beneficiaries

General Healthy Below- Male: +2, Female: +2 Male: 101%, Female: 103% Median Anuuitant

General Disabled

Male: -3, Female: 0 Male: 103%, Female: 106%

General Below-Median Male: +2, Female: +2 Male: 104%, Female: 99% Contingent Survivors

The actuarial assumptions used in the June 30, 2020 valuation were based on the results of an actuarial experience study for the period July 1, 2014 June 30, 2019.

- 41 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 13: RETIREMENT PLANS (CONTINUED)
Pension Liabilities, Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued)
The long-term expected rate of return on TRS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset Class

TRS Target Allocation

Long-term Expected Real Rate of Return*

PSERS Target Allocation

Long-term Expected Real Rate of Return*

Fixed Income Domestic large stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative
Total

30.00% 46.30% 1.20% 11.50% 6.00% 5.00% 100.00%

(0.80)% 9.30%
13.30% 9.30%
11.30% 10.60%

30.00% 46.40% 1.10% 11.70% 5.80% 5.00% 100.00%

(1.50)% 9.20%
13.40% 9.20%
10.40% 10.60%

* Rates shown are net of the assumed rate of inflation.

Discount Rate: The discount rate used to measure the total TRS pension liability was 7.25%. The discount rate used to measure the total PSERS pension liability was 7.00%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and non-employer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS and PSERS pension plans' fiduciary net position were projected to be available to make all projected future benefit payments of current plan members. 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.

- 42 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2022

EXHIBIT "I"

NOTE 13: RETIREMENT PLANS (CONTINUED)

Pension Liabilities, Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued)
Sensitivity of the School District's Proportionate Share of the Net Pension Liability to Changes in the Discount Rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.25%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.25%) or 1-percentage-point higher (8.25%) than the current rate:

School District's proportionate share of the net pension liablity

1% Decrease (6.25%)

Current Discount Rate
(7.25%)

1% Increase (8.25%)

$ 13,515,281 $ 5,017,302 $(1,946,206)

Pension Plan Fiduciary Net Position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS and PSERS financial report which is publicly available at www.trsga.com/publications and http://www.ers.ga.gov/financials.
NOTE 14: SUBSEQUENT EVENT
In May 2022, the citizens of Marion County voted to renew the 1% Special Purpose Local Option Sales Tax ("SPLOST") III, which expired in December 2022. Collections on SPLOST IV began on January 1, 2023.

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MARION COUNTY BOARD OF EDUCATION
SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS' RETIREMENT SYSTEM OF GEORGIA FOR THE FISCAL YEAR ENDED JUNE 30,

SCHEDULE "1"

2015

2016

2017

Fiscal Year

2018

2019

2020

2021

2022

School District's proportion of the net pension liability

0.068161% 0.065672% 0.062577%

0.062996%

0.062156% 0.061445%

0.057764% 0.056729%

School District's proportionate share of the net pension liability $ 8,611,243 $ 9,997,910 $ 12,910,333 $ 11,708,001 $ 11,537,485 $ 13,212,336 $ 13,992,702 $ 5,017,302

School District's covered payroll $ 6,953,819 $ 6,958,471 $ 6,883,616 $ 7,451,451 $ 7,685,229 $ 7,474,359 $ 7,386,887 $ 7,346,375

School District's proportionate share of the net pension liability as a percentage of its covered payroll

123.83%

143.68%

187.55%

157.12%

150.13%

176.77%

189.43%

68.30%

Plan fiduciary net position as a percentage of the total pension

84.03%

81.44%

76.06%

79.33%

80.27%

78.56%

77.01%

92.03%

Note: The measurement period for the year ended June 30, 2022, is June 30, 2021. The Schedule above is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. The Schedule includes all significant plans and funds administered by the Marion County Board of Education.
- 45 -

MARION COUNTY BOARD OF EDUCATION
SCHEDULE OF CONTRIBUTIONS TEACHERS' RETIREMENT SYSTEM OF GEORGIA
FOR THE FISCAL YEAR ENDED JUNE 30,

SCHEDULE "2"

Contractually required contribution
Contributions in relation to the contractually required contribution
Contribution deficiency (excess)

2015

2016

2017

Fiscal Year

2018

2019

2020

2021

2022

$ 915,039 $ 982,292 $ 1,063,322 $ 1,291,887 $ 1,562,141 $ 1,561,588 $ 1,400,219 $ 1,474,339

915,039

982,292

1,063,322 1,291,887

1,562,141

1,561,588

1,400,219

1,474,339

$

- $

- $

- $

- $

- $

- $

- $

-

School District's covered payroll
Contributions as a percentage of covered payroll

$ 6,958,471 $ 6,883,616 $ 7,451,451 $ 7,685,229 $ 7,474,359 $ 7,386,887 $ 7,346,375 $ 7,348,283

13.15%

14.27%

14.27%

16.81%

20.90%

21.14%

19.06%

20.06%

Note: The Schedule above is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available.

- 46 -

MARION COUNTY BOARD OF EDUCATION
SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA FOR THE FISCAL YEAR ENDED JUNE 30,

SCHEDULE "3"

School District's proportion of the net pension liability

2015

2016

2017

Fiscal Year

2018

2019

2020

2021

2022

0.000000% 0.000000% 0.000000% 0.000000% 0.000000% 0.000000% 0.000000% 0.000000%

School District's proportionate share of the net pension liability
State of Georgia's proportionate share of the net pension liability associated with the School District

$

- $

- $

- $

- $

- $

- $

- $

-

98,846

107,498

162,208

142,951

158,239

157,477

177,817

26,607

$ 98,846 $ 107,498 $ 162,208 $ 142,951 $ 158,239 $ 157,477 $ 177,817 $ 26,607

School District's covered payroll
School District's proportionate share of the net pension liability as a percentage of its covered payroll
Plan fiduciary position as a percentage of the total pension liability

$ 340,799 $ 335,232 $ 371,411 $ 407,062 $ 404,641 $ 427,148 $ 457,481 $ 491,913

N/A 88.29%

N/A 87.00%

N/A

N/A

81.00%

85.69%

N/A 85.26%

N/A 85.02%

N/A 84.45%

N/A 98.00%

Note: The measurement period for the year ended June 30, 2022, is June 30, 2021. The Schedule above is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available.
- 47 -

MARION COUNTY BOARD OF EDUCATION

SCHEDULE "4"

SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SCHOOL OPEB FUND
FOR THE FISCAL YEAR ENDED JUNE 30,

2018

2019

Fiscal Year 2020

2021

2022

School District's proportion of the net OPEB liability

0.091746%

0.094649%

0.092607% 0.086703.%

0.083847%

School District's proportionate share of the net OPEB liability

$ 12,890,276 $ 12,029,598 $ 11,364,866 $ 12,734,651 $ 9,081,324

School District's covered-employee

$ 7,750,486 $ 7,865,573 $ 7,933,809 $ 7,928,736 $ 8,075,133

School District's proportionate share of the net OPEB liability as a percentage of its covered-employee payroll

166.32%

152.94%

143.25%

160.61%

112.46%

Plan fiduciary net position as a percentage of the total OPEB liability

1.61%

2.93%

4.63%

3.99%

6.14%

Note: The measurement period for the year ended June 30, 2022, is June 30, 2021. The Schedule above is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. The Schedule includes all significant plans and funds administered by the Marion County Board of Education.
- 48 -

MARION COUNTY BOARD OF EDUCATION
SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND
FOR THE FISCAL YEAR ENDED JUNE 30,

SCHEDULE "5"

Contractually required contribution

2017

2018

Fiscal Year

2019

2020

2021

2022

$ 478,372 $ 490,553 $ 498,758 $ 293,209 $ 311,896 $ 294,518

Contributions in relation to the contractually required contribution
Contribution deficiency (excess)

478,372

490,553

498,758

293,209

311,896

294,518

$

- $

- $

- $

- $

- $

-

School District's coveredemployee payroll

$ 7,750,486 $ 7,865,573 $ 7,933,809 $ 7,928,736 $ 8,075,133 $ 9,092,612

Contributions as a percentage of covered-employee payroll

6.17%

6.24%

6.29%

3.70%

3.86%

3.24%

Note: The Schedule above is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available.
- 49 -

MARION COUNTY BOARD OF EDUCATION
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION FOR THE FISCAL YEAR ENDED JUNE 30, 2022

SCHEDULE "6"

Teachers Retirement System
Changes of assumptions:
On November 18, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males).
On May 15, 2019, the Board adopted recommended changes from the smoothed valuation interest rate methodology that has been in effect since June 30, 2009, to a constant interest rate method. In conjunction with the methodology, the long-term assumed rate of return in assets (discount rate) has been changed from 7.50% to 7.25%, and the assumed annual rate of inflation has been reduced from 2.75% to 2.50%.
In 2019 and later, the expectation of retired life mortality was changed to the Pub-2010 Teachers Headcount Weighted Below Median Healthy Retiree mortality table from the RP-2000 Mortality Tables. In 2019, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience.
Public School Employees Retirement System
Changes of assumptions:
On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to the rates of mortality, retirement, and withdrawal. The expectation of retired life mortality was changed to the RP-2000 Blue Collar Mortality Table projected to 2025 with the projection scale BB (set forward three years for males and two years for females).
A new funding policy was initially adopted by the Board on March 15, 2018, and most recently amended on December 17, 2020. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for the June 30, 2017 actuarial valuation and
On December 17, 2020, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System based on the experience study prepared for the five-year period ending June 30, 2019. Primary among the changes were the updates to rates of mortality, retirement, disability, and withdrawal. This also included a change to the long-term assumed investment rate of return to 7.00%. These assumption changes are reflected in the calculation of the June 30, 2021 Total Pension Liability.
School OPEB Fund
Changes of assumptions:
For the June 30, 2020 actuarial valuation, the decremental assumptions were changed to reflect the Employees' Retirement Systems experience study. Approximately 0.10% of employees are members of the Employees Retirement System.
June 30, 2019 valuation: Decremental assumptions were changed to reflect the Teachers Retirement Systems experience study.
June 30, 2018 valuation: The inflation assumption was lowered from 2.75% to 2.50%.
June 30, 2017 valuation: The participation assumption, tobacco use assumption and morbidity factors were revised.
June 30, 2015 valuation: Decremental and underlying inflation assumptions were changed to reflect the Retirement Systems' experience studies.
June 30, 2012 valuation: A data audit was performed and data collection procedures and assumptions were changed.
The discount rate was updated from 3.07% as of June 30, 2016 to 3.58% as of June 30, 2017, to 3.87% as of June 30, 2018, back to 3.58% as of June 30, 2019, and to 2.22% as of June 30, 2020.

- 50 -

MARION COUNTY BOARD OF EDUCATION

SCHEDULE "7"

GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 2022

REVENUES Property taxes Sales taxes Other taxes State funds Federal funds Charges for services Investment earnings Miscellaneous
Total revenues
EXPENDITURES Current:
Instruction Support services:
Pupil services Improvement of instructional services Educational media services General administration School administration Business administration Maintenance and operation of plant Student transportation services Central support services Other support services Enterprise operations Food services operations Capital outlay Debt service: Principal retirement Interest and fees Total expenditures
Excess (deficiency) of revenues over (under) expenditures
OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources (uses)
Net change in fund balances
FUND BALANCE, beginning of year
FUND BALANCE, end of year

Budget

Original (1)

Final (1)

$

3,385,533 $

3,385,533 $

50,000

50,000

-

-

9,312,185

9,304,506

6,749,162

9,483,836

35,575

35,575

50

50

3,000

3,000

19,535,505

22,262,500

9,637,080
680,470 1,153,148
269,553 449,998 1,614,393 234,269 1,902,199 1,381,038 160,134
75,749 -
1,036,424 1,335,150
19,929,605

12,028,035
608,354 1,277,415
326,643 502,208 1,265,732 234,269 2,087,662 1,548,005 197,881 125,366
1,218,164 1,335,150
22,754,884

(394,100)

(492,384)

(500,000) (500,000)

115,937 (615,937) (500,000)

(894,100)

(992,384)

5,138,065

5,138,065

$

4,243,965 $

4,145,681 $

Actual
3,558,557 64,726 20,276
10,160,947 5,754,655 135,666 414 330,528
20,025,769

Variance With Final Budget

$

173,024

14,726

20,276

856,441

(3,729,181)

100,091

364

327,528

(2,236,731)

9,277,953
472,794 742,112 236,353 340,208 1,155,093 253,865 1,682,246 1,528,191 188,097
84,468 125,684 1,086,511 1,277,612
71,167 1,490
18,523,844
1,501,925
(1,200,000) (1,200,000)
301,925
5,138,065
5,439,990 $

2,750,082
135,560 535,303
90,290 162,000 110,639 (19,596) 405,416
19,814 9,784
40,898 (125,684) 131,653
57,538
(71,167) (1,490)
4,231,040
1,994,309
(115,937) (584,063) (700,000)
1,294,309
-
1,294,309

Note to the Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
(1) Original and final budget amounts do not include budgeted revenues ($380,299) or expenditures ($358,268) of the various school activity accounts.
The accompanying schedule of revenues, expenditures and changes in fund balances, budget and actual, is presented on the modified accrual basis of accounting, which is the basis of accounting used in the presentation of the fund financial statements.

See notes to the basic financial statements.

- 51 -

MARION COUNTY BOARD OF EDUCATION
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED JUNE 30, 2022

SCHEDULE "8"

Funding Agency Program/Grant
Agriculture, U.S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program COVID-19 National School Lunch Program COVID-19 National School Lunch Program National School Lunch Program Total Child Nutrition Cluster State Administrative Expenses Total U.S. Department of Agriculture
Education, U.S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States COVID-19 Grants to States Preschool Grants COVID-19 Preschool Grants Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Migrant Education - State Grant Program Migrant Education - State Grant Program Rural Education Rural Education Title I Grants to Local Educational Agencies Title I Grants to Local Educational Agencies Career and Technical Education - Basic Grants to States Career and Technical Education - Basic Grants to States COVID-19 Education Stabilization Funds COVID-19 Education Stabilization Funds COVID-19 Education Stabilization Funds COVID-19 Homeless Children and Youth (ARP-HCY)
Total U.S. Department of Education
Federal Communications Commission, U.S. Direct COVID-19 - Emergency Connectivity Fund Program Total U.S. Federal Communications Commission
Health and Human Services, U.S. Department of Pass-Through From Bright From the Start Georgia Department of Early Care and Learning COVID-19 - Child Care and Development Block Grant Total U.S. Department of Health and Human Services Total Expenditures of Federal Awards
N/A - Not applicable/available

Assistance Listing Number
10.553 10.555 10.555 10.555 10.560
84.027 84.027X 84.173 84.173X
84.011 84.011 84.358 84.358 84.010 84.010 84.048 84.048 84.425D 84.425D 84.425U 84.425W
32.009
93.575

Pass-Through Entity ID Number

Expenditures In Period

225GA324N1099 225GA324N1099 225GA324N1099 225GA324N1099
195GA904N2533

$

291,447

102,270

31,723

537,169

962,609

5,331

967,940

H027A210073 H027X210073 H173A210081 H173X210081
S011A210011 S011A200011 S358B200010 S358B210010 S010A200010-20A S010A210010-21A V048A200010 V048A210010 S425D210012 S425D200012 S425U210012 S425W210011
N/A

277,929 57,556 6,318 3,510
345,313
5,732 4,038 1,559 28,044 139,361 632,583 1,945 15,227 1,689,078 1,419 1,435,261 1,098 3,955,345 4,300,658
217,584 217,584

N/A

12,174

12,174

$ 5,498,356

- 52 -

MARION COUNTY BOARD OF EDUCATION

SCHEDULE "8"

NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED JUNE 30, 2021

The School District did not provide federal assistance to any subrecipient.
The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of the Marion County Board of Education (the "Board") under programs of the federal government for the year ended June 30, 2022. 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).
Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards , wherein certain types of expenditures are not allowable or are limited as to reimbursement.
The Board has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
During the year ended June 30, 2022, $115,937 was transferred to Title I, Grants to Local Educational Agencies from Supporting Effective Instruction State Grants ($69,332) and the Student Support and Academic Enrichment Grant ($46,605). Expenditures of transfers are reflected within the receiving program.

See notes to the basic financial statements.

- 53 -

MARION COUNTY BOARD OF EDUCATION
SCHEDULE OF STATE REVENUE FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Agency/Funding Grants
Bright from the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program
Education, Georgia Department of Quality Basic Education Direct Instructional Cost: Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Program for Intellectually Gifted Students - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages ("ESOL") Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal, Staff and Professional Development Indirect Cost: Central Administration School Administration Facility Maintenance and Operations Categorical Grants: Pupil Transportation Sparsity Nursing Services Mid-Term Hold Harmless Vocational Supervisors Education Equalization Funding Grant Food Services Vocational Education Amended Formula Adjustment Other State Programs: Hygiene Products in Georgia Schools Bus Purchases - State Allotment One Time Salary Adjustment Pupil transportation - State Bonds Total Grants from Georgia Department of Education
Office of the State Treasurer Public School Employees Retirement
See notes to the basic financial statements.

SCHEDULE "9"

Governmental Fund Type General Fund

$

342,313

471,895 82,648 940,859 222,170 484,939 135,978 817,066 903,703 214,219 818,826 153,686 233,280 65,055 104,412 154,883 49,767 26,239
592
372,426 335,189 329,526
376,119 47,813 45,000 6,806 5,835
1,776,475 27,890 34,560 46,139
863 88,110 339,125 77,220 10,131,626
29,321
$ 10,160,947

- 54 -

MARION COUNTY BOARD OF EDUCATION

SCHEDULE "10"

SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS FOR THE FISCAL YEAR ENDED JUNE 30, 2022

Project
To retire a portion of the principal and interest on the School District's previously incurred general obligation Series 2010B and 2010C Bonds coming due in the years 2018 through 2023.

Original
Estimated Cost (1)

Current
Estimated Costs (2)

Expended
In Current Year (3) (4)

Expended
In Prior Years (3) (4)

Total Completion
Cost

Estimated Completion
Date

$ 2,500,000 $ 2,500,000 $

- $

- $

- December 2022

(i) Making system-wide

technology improvements,

including, but not limited to,

the acquisition and installation

of instruction technology,

security, and information

system hardware and

associated software

accessories, and infrastructure

at all schools and selected

other facilities; (ii) Improving

school facilities, purchasing

school buses, school

equipment, and acquiring

safety and security equipment.

500,000

500,000

-

-

- December 2022

$ 3,000,000 $ 3,000,000 $

- $

- $

-

(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. (2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. (3) The voters of Marion County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. (4) $585,673 Interest & $80,000 Principal paid on Bonds in FY2022; $344,496 from Federal Subsidy; $304,872 from property taxes;
$16,305 from Sales Tax. (5) Sinking Fund Payment of $468,652 was paid from sales tax.

See notes to the basic financial statements.

- 55 -

Section II Compliance and Internal Control Reports

Greg S. Griffin State Auditor
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
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Mr. Jamie Penoncello, Superintendent and Members of the Marion County Board of Education
We have audited the financial statements of the governmental activities, each major fund, and fiduciary activities of the Marion County Board of Education (School District) as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated March 28, 2023. We conducted our audit in accordance with the auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States.
Report on Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the basic financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District'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 School District'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. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that were not identified.
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the School District'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 financial statements. 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.
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 District'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 District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully submitted,
Greg S. Griffin State Auditor
March 28, 2023

Greg S. Griffin State Auditor
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Mr. Jamie Penoncello, Superintendent and Members of the Marion County Board of Education
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited the Marion County Board of Education's (School District) compliance with the types of compliance requirements identified as subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of the School District's major federal programs for the year ended June 30, 2022. The School District'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, the School District complied, in all material respects, with the 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, 2022.
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 (GAAS); 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 District 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 District's compliance with the compliance requirements referred to above.
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

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 District's federal programs.
Auditor's Responsibilities 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 District'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 GAAS, 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 for 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 District's compliance with the requirements of each major federal program as a whole.
In performing an audit in accordance with GAAS, 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 School District'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 School District'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 the School District'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.
Respectfully submitted,
Greg S. Griffin State Auditor
March 28, 2023

Section III Auditee's Response to Prior Year Findings and Questioned Costs

MARION COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS YEAR ENDED JUNE 30, 2022
PRIOR YEAR FINANCIAL STATEMENT FINDINGS No matters were reported.
PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.

Section IV Findings and Questioned Costs

MARION COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2022

I SUMMARY OF AUDITOR'S RESULTS

Financial Statements

Type of auditor's report issued: Governmental Activities, Each Major Fund, and Fiduciary Activities
Internal control over financial reporting: Material weakness(es) identified? Significant deficiency(ies) identified?
Noncompliance material to financial statements noted:

Unmodified
No None Reported
No

Federal Awards

Internal Control over major programs: Material weakness(es) identified? Significant deficiency(ies) identified?

Type of auditor's report issued on compliance for major programs:

All major programs

Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a)?

Identification of major programs:

Assistance Listing Number Assistance Listing Program or Cluster Title

84.425 84.010

Education Stabilization Fund Title I Grants to Local Educational Agencies

Dollar threshold used to distinguish between Type A and Type B programs:

Auditee qualified as low-risk auditee?

No None Reported
Unmodified No
750,000 Yes

II FINANCIAL STATEMENT FINDINGS No matters were reported. Ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.