Audit report, Houston County Public Library, Perry, Georgia, year ended June 30, 1997

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AUDIT REPORT HOUSTON COUNTY PUBLIC LIBRARY
PERRY, GEORGIA YEAR ENDED JUNE 30, 1997
'-----------
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET ATLANTA, GEORGIA 30334-8400

HOUSTON COUNTY PUBLIC LffiRARY - 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

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

3

C

STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

GENERAL AND SPECIAL REVENUE FUNDS

5

D

STATEMENT OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

6

E

STATEMENT OF CASH FLOWS

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

7

F NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

8

ADDITIONAL FINANCIAL INFORMATION

COMBINING AND INDIVIDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

16

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

17

FIDUCIARY FUND TYPES

I

COMBINING BALANCE SHEET

18

J

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUNDS

19

SCHEDULES

SCHEDULE OF REVENUE

1

STATE

20

2

FEDERAL

21

3 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAM

22

4 SCHEDULE OF SALARIES AND TRAVEL

23

HOUSTON COUNTY PUBLIC LffiRARY - TABLE OF CONTENTS -
SECTIONll FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

CLAUDE L. VICKERS
STATE AUDITOR (404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
June 4, 1998

Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Technical and Adult Education
and Director and Members of the Houston County Public Library 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 of the Houston County Public Library, as of and for the year ended June 30, 1997, as listed in the table of contents. These general-purpose financial statements are the responsibility of the Houston County Public Library'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 financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As described in the notes to the general-purpose fmancial 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 variance or omission have not been determined, but are believed to be material.

97ARL-43

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 ofthe Houston County Public Library as of June 30, 1997, and the results of its operations and the cash flows of its nonexpendable trust funds for the year then ended, in conformity with generally accepted accounting principles.
As discussed in Note 1 to the general-purpose financial statements, during fiscal year 1997, the Library changed its method of accounting from the cash basis to the modified accrual basis. This change is in accordance with generally accepted accounting principles.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements ofthe Houston County Public Library taken as a whole. The accompanying combining and individual fund statements (Exhibits G through J) and the fmancial schedules (Schedules I through 4), as listed in the table ofcontents, are presented for purposes ofadditional analysis and are not a required part ofthe general-purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general-purpose financial statements and in our opinion 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.

CLV:gp 97ARL-43

Claude L. Vickers State Auditor

HOUSTON COUNTY PUBLIC LffiRARY

HOUSTON COUNTY PUBLIC LIBRARY COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30, 1997

EXHIBIT"A"

ASSETS Cash and Cash Equivalents Investment Held by Trustee

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

FIDUCIARY FUND TYPES TRUST AND AGENCY FUNDS

TOTAL (Memorandum
Only)

$

73,911.98 $

0.00 $

26,839.40 $

100,751.38

86,653.06

86,653.06

Total Assets

$

73,911.98 $

0.00 $

113,492.46 $ ............1..8..7....,..4.0...4.....4..4;";,,

LIABILITIES AND FUND EQUITY
LIABILITIES
Deferred Compensation Plan
FUND EQUITY
Fund Balances Reserved For Endowment Corpus Unreserved Designated for Self-Insurance Undesignated
Total Fund Equity

$

12,000.00

61,911.98 $

$

73,911.98 $

Total Liabilities and Fund Equity

$

73,911.98 $

$

86,653.06 $ _ _-=8.=.16,.:.;65"-=3",,,.0,-=-6

$
-..::O~.O~O
0.00 $

26,839.40 $

26,839.40

12,000.00

0.00

61,911.98

26,839.40 $ _---'1""'00:.1.,7.:.;:5;..;.1.:.::;.3:-8

0.00 $

113,492.46 $ _....,;1.8.70.1.,4.0..4....4...4..

The notes to the general purpose financial statements are an integral part of this statement. -2-

HOUSTON COUNTY PUBLIC LIBRARY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30,1997

EXHIBIT "B"

FUND BALANCE JUNE 30,1997

$

73,911,98 $

0.00 $ _ _7..3..,9;.;1...;01';,;;,9.8..

The notes to the general purpose financial statements are an integral part of this statement. -3-

THIS PAGE LEFT BLANK

HOUSTON COUNTY PUBLIC LIBRARY STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 1997

EXHIBIT"C"

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Program Services Technical Services Circulation Administration Maintenance and Operations
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1, 1996 - (See Note 1 Basis of Accounting)

GENERAL FUND

BUDGET

ACTUAL

$ 265,491,20 $ 281,370,73

437,720.67

451,923.81

$ 703,211.87 $ 733,294.54

$ 349,720.85 $ 221,537,79

20,492.42

129,005.68

700,00

126,932,27

359,606.40

218,847,71

$ 710,027,25 $ 716,815.87

$

-6,815.38 $

16,478.67

100,751.38

57,433.31

SPECIAL REVENUE FUND

BUDGET

ACTUAL

$

0.00 $

6,850.00

28,000,00

$

0,00 $ 34,850.00

$

0.00 $

6,850.00

28,000.00

$

0.00 $ 34,850.00

$

0,00 $

0.00

0.00

0.00

FUND BALANCE JUNE 30,1997

$

93,936.00 $=====73::!,,9=1=1,;,;;.9.=8

$

0.00 $===.,;;0,;,;;.0.=0

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

HOUSTON COUNTY PUBLIC LIBRARY STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30.1997

EXHIBIT"D"

OPERATING REVENUES None Recorded
OPERATING EXPENSES Current Program Services Supplies Operating Income (Loss)
NONOPERATING REVENUES Interest Earned Total Income (Loss)
FUND BALANCE JULY 1, 1996 - (See Note 1 - Basis of Accounting)

NOLA BRANTLEY MEMORIAL
LIBRARY FUND

TOTAL

$

0.00 $

0,00

$

1,391,01 $

1,391,01

$

-1,391.01 $

-1,391.01

1,391,01

1,391,01

$

0,00 $

0,00

26,839.40

26,839.40

FUND BALANCE JUNE 30,1997

$

26,839.40 $

2..6._. .,8.3.9....4..0.. .

The notes to the general purpose financial statements are an integral part of this statement. -6-

HOUSTON COUNTY PUBLIC LIBRARY STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30.1997

EXHIBIT"E"

Cash Flows from Operating Activities: Cash Paid for Supplies
Cash Flows from Investing Activities: Interest Received on Investments
Net Increase in Cash
Cash and Cash Equivalents - July 1, 1996

NOLA BRANTLEY MEMORIAL
LIBRARY FUND

TOTAL

$

-1,391.01 $

-1,391.01

1,391.01

1,391.01

$

0.00 $

0.00

$

26,839.40 $

26,839.40

Cash and Cash Equivalents - June 30, 1997

$

26,839.40 $ ......-=......2...6...,.8..3..9.....4""'.0...

The notes to the general purpose financial statements are an integral part of this statement. -7-

HOUSTON COUNTY PUBLIC LmRARY

EXlllBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Houston County Public Library (Library) operates pursuant to Official Code of Georgia Annotated Sections 20-5-40 through 20-5-59 to provide public library services with costs shared by participating local governmental agencies and grants from the State of Georgia. With the exception of the departure from generally accepted accounting principles disclosed in these notes, the financial statements of the Library have been prepared in conformity with generally accepted accounting principles as applied to governmental units and unless otherwise disclosed in these notes, the fmancial statements present all fund types and account groups of the Library.
The Library Board consists of 12 members; 3 members appointed by Houston County Board of Commissions, 3 members appointed by Centerville City Council, 3 members appointed by Perry City Council and 3 members appointed by Warner Robins City Council. The Board is without authority to determine the amount of its funding, except by submission of budget requests to local governmental units from which the Library receives support and to the State of Georgia for State and Federal funding. Membership in the Library and participation in library services is at the discretion of each participating governmental agency. The Library Board has the power to designate management, the power to retain unreserved fund balances of local funds for continued operations and is the lowest level of oversight responsibility for the Library's operations. The Houston County Library is therefore determined to be a joint venture.
FUND ACCOUNTING
The Library 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 fmancial management by segregating transactions related to certain governmental functions or activities. A fund isa separate accounting entity with a selfbalancing set of accounts.
General Fixed Assets, which includes the Library's inexhaustible collections and books, are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Library. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
The general purpose fmancial statements account for all State, Federal 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 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:

-8-

HOUSTON COUNTY PUBLIC LIBRARY

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. The primary type of special revenue fund consists of proceeds received from State and Federal sources to accomplish specific objectives and are required to be accounted for separately.
FIDUCIARY FUND TYPES - the trust and agency funds used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include:
NONEXPENDABLETRUSTFUND Nola Brantley Memorial Library Fund - the fund used to account for an endowment ofwhich the corpus is to be invested and preserved intact with the resultant income to be used for Library operations.
AGENCY FUNDS - the funds used to account for assets held for other funds, governments, or individuals.
BASIS OF ACCOUNTING
The accounting and financial 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.
Nonexpendable trust funds are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and liabilities associated with the operation of these funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
Agency funds are purely custodial in nature and do not involve measurement of results of operations.
Governmental funds are accounted for using the modified accrual basis of accounting under which:

- 9-

HOUSTON COUNTY PUBLIC LIBRARY

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenues are recognized when susceptible to accrual (Le., 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.
The accrual basis of accounting, as required by generally accepted accounting principles, is utilized by the nonexpendable trust funds. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.
Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities.
Audit reports for prior years of the Houston County Public Library reported all financial statements, on the cash basis of accounting. This report presents all statements on the modified accrual basis of accounting, except for the Nonexpendable Trust Fund which utilized the accrual basis of accounting. This represents a change in the application of accounting principles.
BUDGET
The Houston County Public Library's budget is a complete financial plan for the Library's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level ofbudget control was established by the Library at the aggregate level. The budget for governmental funds was prepared in accordance with generally accepted accounting principles.
The budget process begins when the Library's administration prepares a tentative aggregated budget for the Board's approval. After approval of this tentative budget by the Board, copies are sent to all local funding agencies. After funding approval is received from all local funding agencies, the Board makes revisions as necessary and adopts the budget. The budget is then submitted to the Department of Technical and Adult Education as a part of the Library's annual application for State aid. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws authorize the Library to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations.
- 10-

HOUSTON COUNTY PUBLIC LIBRARY

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVESTMENTS HELD BY TRUSTEE
Investments held by trustee consist of contributions from employees who have elected to participate in the Library's deferred compensation plan. See Note 6 - Deferred Compensation Plan
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.
Additionally, the dollar value ofaccumulated compensated absences at June 30, which will be payable from future resources has not been recorded in the General Long-Term Debt Account Group as this liability is also deemed to be immaterial to the fair presentation of these financial statements.
INTERFUND TRANSACTIONS
The Library has the following types of interfund transactions:
Reimbursements of expenditures/expenses initially made from a fund that are properly applicable to another fund are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses 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 fmancial position, results ofoperations or cash flows in conformity with generally accepted accounting principles, nor is such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation ofthis data.
Note 2: DEPOSITS AND INVESTMENTS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 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 not less than 110 percent ofthe public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.
- 11 -

HOUSTON COUNTY PUBLIC LffiRARY

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 2: DEPOSITS AND INVESTMENTS
Acceptable security for deposits consists of anyone 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 ofthe 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 ofa subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and 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.
CATEGORIZAnON OF DEPOSITS At June 30, 1997, the bank balances were $109,820.33. The bank balances were entirely covered by Federal depository insurance or by collateral held by the Library or the Library's agent in the Library's name.
CATEGORIZATION OF INVESTMENTS At June 30, 1997, the carrying amount of the Library's total investments was $86,653.06 and this entire amount is categorized as Unclassified - Deferred Compensation Plan pooled investments. The market value of these investments was $86,653.06.
Note 3: RISK MANAGEMENT
The Library is exposed to various risks ofloss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster; and unemployment compensation.

- 12 -

HOUSTON COUNTY PUBLIC LffiRARY

EXIllBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 3: RISK MANAGEMENT

The Library has obtained commercial insurance for risk of loss associated with torts, assets and job related illness or injuries to employees. The Library has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Library's insurance coverage in any of the past three years.

The Library has elected to self-insure for all losses related to natural disaster. In addition, the Library has elected to self-insure for errors or omissions, which includes, among other risks, risks for sexual harassment and discrimination. The Library has not experienced any losses related to these risks in the past three years.

The Library is self-insured with regard to unemployment compensation claims. The Library accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurred, and the amount ofthat loss can be reasonably estimated.

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

Position Covered

Amount

All Employees

$ 50,000.00

Note 4: OPERATING LEASES

The Library has committed under various leases for copiers. These leases are considered for accounting purposes to be operating leases. Lease expenditures for the year ended June 30, 1997, amounted to $6,597.72. Future minimum lease payments for these leases are as follows:

Year Ending

Amount

1998 1999

$ 5,539.20 1,384.80

Total

$ 6,924.00

Note 5: CONTINGENT LIABILITIES

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 expenditures which are disallowed under grant terms. The Library believes that such disallowances, if any, will be immaterial to its overall financial position.

- 13-

HOUSTON COUNTY PUBLIC LIBRARY

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 6: DEFERRED COMPENSATION PLAN
The Library offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all Library employees, permits them to defer a portion oftheir salary until future years. The deferred compensation is not available to employees until termination, retirement, death or unforeseeable emergency.
All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights of the Library (without being restricted to the provisions of benefits under the plan), subject only to the claims of the Library's general creditors. Participants' rights under the plan are equal to those of general creditors of the Library in an amount equal to the fair market value of the deferred account for each participant.
It is the opinion ofthe Library that the Library has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. The Library believes it is unlikely that it will use the assets to satisfy the claims of general creditors in the future.
Investments are managed by the plan's trustee, Lincoln National Sales Corporation of Georgia. Under this plan, participants select from an investment option, or combination of investment options, determined by the Library.
On August 20, 1996, Federal laws governing Internal Revenue Code Section 457 plans were changed to require all assets and income of the plan to be held in trust for the exclusive benefit of the participants and their beneficiaries. The Library is required to comply with this requirement by January 1, 1999.
Note 7: ACCUMULATED EMPLOYEES' LEAVE
Employees earn annual leave ranging from five-sixths to one and two third days each month depending upon the employees' length of continuous service with a maximum accumulation of thirty days. Employees are paid, at their current rate ofpay, a maximum often days for unused accumulated annual leave upon retirement or termination of employment. See Note 1 - Compensated Absences
Note 8: 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 defmed 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.
- 14-

HOUSTON COUNTY PUBLIC LffiRARY

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 8: RETIREMENT PLANS

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 11.81% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1997 1996 1995

100% 100% 100%

$ 43,793.34 $ 41,615,11 $ 38,924.67

- 15 -

ASSETS Cash and Cash Equivalents
FUND EQUITY Fund Balances
Unreserved Undesignated

HOUSTON COUNTY PUBLIC LIBRARY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 3D. 1997

EXHIBIT"G"

LOTTERY PROGRAM

FEDERAL PROGRAM

$

0.00 $

0.00 $

TOTAL
....;,0.00'"=

$

0.00 $

0.00 $

...0. _.0_0

See notes to the general purpose financial statements.

- 16-

HOUSTON COUNTY PUBLIC LIBRARY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 1997

EXHIBIT "H"

REVENUES
State Funds Federal Funds
Total Revenues
EXPENDITURES
Current Technical Services Maintenance and Operations
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1,1996

LOTIERY PROGRAM

FEDERAL PROGRAM

TOTAL

$

6,850,00

$

$

6,850,00 $

$ 28,000,00
28,000,00 $

6,850,00 28,000,00
34,850,00

$

6,850.00

$

$ 28,000,00

6,850,00 28,000,00

$

6,850,00 $

28,000.00 $

34,850.00

$

0.00 $

0,00 $

0,00

0,00

0,00

0,00

FUND BALANCE JUNE 30,1997

$

0,00 $

0,00 $=====0=.0=0

See notes to the general purpose financial statements.

-17-

HOUSTON COUNTY PUBLIC LIBRARY COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 30,1997

EXHIBIT "I"

ASSETS Cash and Cash Equivalents Investment Held by Trustee

NONEXPENDABLE
TRUST FUND NOLA BRANTLEY MEMORIAL LIBRARY FUND

AGENCY FUND DEFERRED
COMPENSATION PLAN

TOTALS JUNE 30,1997

$

26,839.40

$

26,839.40

_ _ _ _ _ _ $ _ _~8=..:6:.t.:,6::.:5;.:.3.:..::;0;:..6

86,653.06

Total Assets

$

26,839.40 $

86,653.06 $===1..1.:=l3,=49=2=.4;,;;;,.6

LIABILITIES AND FUND EQUITY
LIABILITIES
Deferred Compensation Plan
FUND EQUITY
Fund Balances Reserved For Endowment Corpus Unreserved Undesignated
Total Fund Equity

$

86,653.06 $ _ _---=.86.=..!,.=.:65::.:3;.;.::.0~6

$

26,839.40

0.00 $

$

26,839.40 $

$

26,839.40

---=.0;.:.0.:::..0

0.00

0.00 $ _ _--=2::.=6:.:.::,8;.:3.=.;9.:...:,4;:..0

Total Liabilities and Fund Equity

$

26,839.40 $

86,653.06 $===1..1.:=l3,=49=2=.4;,;;;,.6

See notes to the general purpose financial statements.

- 18-

HOUSTON COUNTY PUBLIC LIBRARY STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUNDS YEAR ENDED JUNE 30,1997

EXHIBIT"J"

DEFERRED COMPENSATION PLAN
ASSETS Cash and Cash Equivalents

BALANCE JULY 1,1996

ADDITIONS

DEDUCTIONS

BALANCE JUNE 3D, 1997

$

80,391.35 $

6,261.71 $

0.00 $

86,653.06

LIABILITIES Deferred Compensation Plan

$

80,391.35 $

6,261.71 $

0.00 $ _ ...._ .8.6.:=;,.6.5.-.3=.0.6..

See notes to the general purpose financial statements.

-19-

HOUSTON COUNTY PUBLIC LIBRARY SCHEDULE OF STATE REVENUE
YEAR ENDED JUNE 30,1997

SCHEDULE "1"

AGENCY/FUNDING
GRANTS Technical and Adult Education, Georgia Department of Public Libraries Salaries and Travel Library Materials Maintenance and Operation Lottery Program Assistive Technology Grants

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 165,040.73 58,165.00 58,165.00
-----$

$ 165,040.73 58,165.00 58,165.00

6,850.00

6,850.00

$ 281,370.73 $

6,850.00 $ 288,220.73

See notes to the general purpose financial statements.

- 20-

HOUSTON COUNTY PUBLIC LIBRARY SCHEDULE OF FEDERAL REVENUE
YEAR ENDED JUNE 30,1997
AGENCYIFUNDING
GRANT Education, U. S, Department of Through Georgia Department of Education Adult Education Library Services and Construction Act TItle I - Public Library Services Through Georgia Department of Technical and Adult Education Library Services and Construction Act Title I - Public Library Services

SCHEDULE "2"
GOVERNMENTAL FUND TYPE SPECIAL REVENUE FUND

$

14,000.00

14,000.00

$

~28,;,;',;,;00_0~.0~0

See notes to the general purpose financial statements.

- 21 -

HOUSTON COUNTY PUBLIC LIBRARY SCHEDULE OF EXPENDITURES LOTTERY PROGRAM YEAR ENDED JUNE 30.1997
EXPENDITURES Technical Services Equipment

SCHEDULE "3"
ASSISTIVE TECHNOLOGY
$ ======6;,;;,8=50~.0;.;;:0

See notes to the general purpose financial statements.
- 22-

HOUSTON COUNTY PUBLIC LIBRARY SCHEDULE OF SALARIES AND TRAVEL
YEAR ENDED JUNE 3D, 1997

SCHEDULE "4"

PERSONNEL
Arnold, Bruce, Burnett, Bush, Chapman, Colbert, Cummins, Drennan, Evans, Faircloth, Faircloth, Fuller, Golden, Granger, Grant, Hannon, Hannon, Hill, Hill, Houston, Howard, Jackson, Jeffcoat, Kuder, Laster, Lawrence, MacDonald, Merk, Milton, Morrow-Loving, Northern, Powell, Sayre, Summers, Tucker, Wallace, Waterman, Wells, Wheeler, Williams, Wright, Yeatman,

JoAnn Dianne E. Shalanda
Isabelle R.
Garry Peggy L. Shelia Sue Ann Lydia Donna Leah Ruth Ellison Vivian Judith Nancy Wendy Jacqueline Kelsey Barbara Sherika Clarence Gwendolyn Megan Anna Rosemary Katharine Mary Jo Valrae Evelyn Christina Debra Dorothy Rodney Janet JoAnne Margaret Hoza MaryAnn Takahashi Alma Marcia Dana Rebecca

POSITION
Library Clerk Library Clerk Page Reference Librarian Page Library Clerk Reference Librarian Library Clerk Library Clerk Library Clerk Branch Head Accountant Director Head Librarian Page Library Clerk Page Page Page Page Page Page Library Clerk Children's Specialist Library Clerk Library Clerk Library Clerk Head Librarian Library Clerk Library Clerk Library Clerk Library Clerk Technical Services Library Clerk Library Clerk Maintenance Maintenance Page Maintenance Library Clerk Page Children's Specialist

SALARIES

TRAVEL

$

8,865.80 $

2,463.54

2,709.13

26,985.50

171.00

6,076.48

13,415.64

5,811.61

4,059.25

142.50

15,494.03

21,425.25

55,470.84

43,672.00

988.13

9,274.06

418.15

3,633.02

174.25

811.75

2,621.25

2,489.50

1,902.38

14,692.92

9,859.97

215.33

6,274.35

46,482.00

1,748.00

4,602.14

12,207.28

11,575.38

14,484.64

11,575.38

11,575.72

5,938.59

2,170.70

901.01

5,981.91

223.25

3,275.00

8,032.86

133.51 122.25 45.25
101.00 295.50 1,334.22 104.00
186.00 47.02 515.14
215.75 17.70
241.56

See notes to the general purpose financial statements.

- 23-

$ 400,891.49 $ ===3=,3=5..8.....9...0...

SECTIONll FINDINGS AND QUESTIONED COSTS

HOUSTON COUNTY PUBLIC LffiRARY SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 1997
PRIOR YEAR
AUDIT FOLLOW-UP/RESOLUTION Inadequate Separation of Duties Finding Resolved Audit Control Number 6762-93-01
The audit report for the year ended June 30, 1996 stated that the Library did not provide for adequate separation of employee duties in the perfonnance of accounting and related procedures for all funds. For the year under review, the Library implemented controls which provide for an improvement to separation of employee duties.
PRIORYEAWCURRENTYEAR
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Audit Control Number 6762-93-02
The Library did not maintain a system-wide General Fixed Assets Account Group within the fonnal accounting records as required by generally accepted accounting principles. This condition was a result of management's decision not to maintain the account group and results in the general purpose financial statements of the Library being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should by taken by the Library 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, and equipment owned by the Library 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.