Audit report, Conyers-Rockdale Library System, Conyers, Georgia, year ended June 30, 1999

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AUDIT REPORT CONYERS-ROCKDALE LIBRARY SYSTEM
CONYERS, GEORGIA YEAR ENDED JUNE 30, 1999

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STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

CONYERS-ROCKDALE LIBRARY SYSTEM - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

GENERAL FUND

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

SCHEDULE OF REVENUE

1

STATE

2

LOCAL

3 SCHEDULE OF SALARIES AND 1RAVEL

SECTION II FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

2 3 5 6
14 15 16
,.

SECTION I FINANCIAL

RUSSELL \V. HINTON
STATE AUDITOR
1404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washinglllll Street, S.W.. Suile 214 Atlant~l. Georgia 30334-X400
May 10, 2000

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the Board of Regents of the University System of Georgia
and Director and Members of the Conyers-Rockdale Library System Board
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
Ladies and Gentlemen:
We have audited the accompanying general purpose financial statements ofthe Conyers-Rockdale Library System, as of and for the year ended June 30, 1999, as listed in the table of contents. These general purpose financial statements are the responsibility of the Conyers-Rockdale Library System's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall fmancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As described in the notes to the general purpose financial statements, the Library's financial statements have been prepared using a certain accounting practice and policy which, in our opinion, varies in some respects from generally accepted accounting principles. This variance is described as follows:
* The general purpose financial statements of the Library did not contain a General Fixed Assets
Account Group to account for property, equipment and inexhaustible collections and books owned by the Library which should be included to conform to generally accepted accounting principles.
The aggregate effects on the general purpose financial statements of this omission have not been determined, but are believed to be material.
99ARL-42A

In our opinion, except for the effects on the general purpose financial statements of the matter referred to in the third paragraph, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the Conyers-Rockdale Library System as of June 30, 1999, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements ofthe Conyers-Rockdale Library System taken as a whole. The accompanying financial schedules (Schedules I through 3), as listed in the table of contents, are presented for purposes of additional analysis and are not a required part of the general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effects of the matter discussed in the third paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole.
A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.
Respectfully SUbmitted,
~~'W~i:n' ~L.:k. State Auditor
RWH:gp 99ARL-42A

CONYERS-ROCKDALE LIDRARY SYSTEM

CONYERS-ROCKDALE LIBRARY SYSTEM COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30,1999

EXHIBIT "B"

REVENUES
State Funds Federal Funds Local Funds Other Funds
Total Revenues
EXPENDITURES
Current Public Services Technical Services Circulation Support Services Maintenance and Operation
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1

GENERAL FUND

CAPITAL PROJECTS
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 1999

JUNE 30, 1998

$ 187,115.84
472,685.96 146,798.52 $
$ 806,600.32 $

$
18,667.19 18,667.19 $

187,115.84 $
472,685.96 165,465.71
825,267.51 $

297,873.98 15,484.00
466,143.72 159,862.63
939,364.33

$ 439,283.50 $ 105,221.12

63,839.08 $

135,970.73 110,106.07

$ 790,581.42 $ 63,839.08 $

$ 16,018.90 $ -45,171.89 $

199,924.96

357,119.20

503,122.58 $ 105,221.12
135,970.73 110,106.07
854,420.50 $
-29,152.99 $
557,044.16

471,549.85 115,964.65 157,761.80 140,655.11 100,307.81
986,239.22
-46,874.89
603,919.05

FUND BALANCE JUNE 30

$ 215,943.86 $ 311,947.31 $

527,891.17 $ ....__5.5..7...,..0.=4.4....1...6.=.

The notes to the general purpose financial statements are an integral part of this statement.
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CONYERS-ROCKDALE LIBRARY SYSTEM COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL GENERAL FUND
YEAR ENDED JUNE 30,1999

EXHIBIT "C"

REVENUES
State Funds Local Funds Other Funds
Total Revenues
EXPENDITURES
Current Public Services Technical Services Support Services Maintenance and Operation Information Technology
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1,1998

BUDGET

ACTUAL

$

187,115.84 $

472,596.00

129,035.00

$

788,746.84 $

187,115.84 472,685.96 146,798.52
806,600.32

$

430,758.14 $

108,885.95

134,330.17

115,900.10

15,000.00

$

804,874.36 $

$

-16,127.52 $

199,924.96

439.283.50 105.221.12 135,970.73 110,106.07
790,581.42
16,018.90
199.924.96

FUND BALANCE JUNE 30, 1999

$

183,797.44 $ _ ......2...1..5...;0,,9.43.""'.8-=6

The notes to the general purpose financial statements are an integral part of this statement. -5-

CONYERS-ROCKDALE LIBRARY SYSTEM

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1999

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The general purpose financial statements account for all State, Federal, Local and Other funds under control of the Library, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - used to account for all or most of the Library's general activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the Library except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a Library.
CAPITAL PROJECTS FUND - the fund used to account for the acquisition of land, development and construction of and equipping the Conyers-Rockdale Library System.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for compensated absences.
BASIS OF ACCOUNTING
The accounting and fmancial reporting treatment applied to a fund is determined by its measurement focus, All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities are generally included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets, Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group,
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e" when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Those revenues considered susceptible to accrual are intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.

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CONYERS-ROCKDALE LIBRARY SYSTEM

EXHIBIT liD"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1999

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(4) Obligati':ms of any corporation of the United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
(8) Obligations of other political subdivisions of the State of Georgia.
RECEIVABLES
Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed, allotted funds from participating local governments, 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 general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
COMPENSATED ABSENCES
Compensated absences represent obligations of the Library relating to employees' rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be. reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general purpose financial statements.
INTERFUND TRANSACTIONS
The Library has the following type of interfund transactions:
Reimbursements of expenditures initially made from a fund that are properly applicable to another fund are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.
MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles, nor is such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
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CONYERS-ROCKDALE LIBRARY SYSTEM

EXHIBIT liD"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1999

Note 2: DEPOSITS AND INVESTMENTS

Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Library's name.
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Library's name.)

The Library's deposits are classified by risk category at June 30, 1999, as follows:

Risk Category

Bank Balance

1

$ 111,497,13

2

11,673.54

3

0.00

Total

$ 123.170.67

CATEGORIZATION OF INVESTMENTS At June 30, 1999, the carrying value of the Library's total investments was $375,859,78 which is materially the same as fair value. This investment consisted entirely of funds invested in the Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services which are not required to be categorized since the Library did not own any specific identifiable securities in the pool. The investment policy ofthe State of Georgia, Office of Treasury and Fiscal Services for the Local Government Investment Pool (primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description of the Primary Liquidity Portfolio is as follows:

The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. However, Georgia Fund 1 operates in a manner consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and is considered to be a 2a-7 like pool. The pool is not registered with the SEC as an investment company. The pool's primary objectives are safety of capital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value), Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and determines participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value, The pool does not issue any legally binding guarantees to support the value of the shares. Participation in the pool is voluntary and deposits consist of funds from local governments; operating and trust funds of Georgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund.

Investments in Georgia Fund 1 and Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average

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CONYERS-ROCKDALE LIBRARY SYSTEM

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1999

Note 5: ACCUMULATED EMPLOYEES' LEAVE

The Library's full-time employees earn annual leave according to their length of service ranging from 12 to 24 days per year with a maximum accumulation of 15 days. Part-time regular employees earn annual leave on a pro rata basis. All unused leave is paid to employees at their current rate of pay upon retirement or termination of employment unless proper notice of resignation is not given by the employee. See Note 1 Compensated Absences

Note 6: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all librarians and clerical personnel employed by regional and county libraries are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Library who are covered by TRS are required by State statute to contribute 5% oftheir gross earnings to TRS. The Library makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11.95% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

. Percentage Contributed

Required Contribution

1999 1998 1997

100% 100% 100%

$ 46,107.65 $ 44,831.62 $ 41,940.28

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CONYERS-ROCKDALE LIBRARY SYSTEM SCHEDULE OF LOCAL REVENUE YEAR ENDED JUNE 30,1999
LOCAL SOURCES City Government Conyers County Government Board of Commissioners Rockdale County

SCHEDULE "2"

GOVERNMENTAL FUND TYPE GENERAL FUND

$

159,426.00

313,259.96

$ ===4=7=2;l,;,6=8=5,=9:=6

See notes to the general purpose financial statements,

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NAME Valles, Joseph Vater, Jessica Watson, Brooke Young, Jane
Accrual June 30, 1999
Totals per Report

CONYERS-ROCKDALE LIBRARY SYSTEM SCHEDULE OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30, 1999

SCHEDULE "3"

TITLE CATEGORY
Technology Specialist Page Desk Assistant Page

SALARIES

TRAVEL

$

23,400,00 $

1,810.23

2,920.20

1,156.30

159,77

$ 468,115.08 $

3,253.76

506,07

252.69

$ 468,621.15 $ ===3=,5=0:=6.=45=

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SECTION II FINDINGS AND QUESTIONED COSTS

CONYERS-ROCKDALE LIBRARY SYSTEM SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30. 1999
PRIOR YEAR
CASH AND CASH EQUNALENTS Uncollateralized Deposits Finding Resolved Finding Control Number: 7222-98-01
The audit report for the year ended June 30, 1998, noted that the Library failed to have its bank balances fully collateralized as provided for by the Official Code of Georgia Annotated Section 45-8-12. During the year under review, the Library implemented procedures to monitor the collateralization of bank balances to ensure compliance at all times with State laws governing deposits and investments.
PRIORYE~CwumNTYEAR
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: 7222-93-01
The audit report for the year ended June 30, 1998, noted that the management of the Conyers-Rockdale Library System had chosen not to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Library System did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements of the Library System being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Library System to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings, equipment and inexhaustible collections and books owned by the Library System and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group.