Audit report, Thomas County Public Library System, a component unit of Thomas County, Georgia, year ended June 30, 1998

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AUDIT REPORT TIIOMAS COUNTY PUBLIC LIBRARY SYSTEM A COMPONENT UNIT OF TIIOMAS COUNTY, GEORGIA
YEAR ENDED JUNE 30, 1998
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

THOMAS COUNTY PUBLIC LIBRARY SYSTEM -TABLEOFCONIENTS-

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

4

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

9

ADDffiONAL FINANCIAL INFORMATION

SCHEDULES

1 SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

16

SCHEDULE OF REVENUE

. 2

STATE

17

3

FEDERAL

18

4

LOCAL

19

S ScaIIDULE OF SALARIES AND TRAVEL

20

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

SECTION I FINANCIAL

w. RUSSELL HINTON STATE AUDITOR (404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 15, 1999

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board of Technical and Adult Education
and Director and Members ofthe Thomas County Public 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 of the Thomas County Public Library System, a component unit of Thomas County, Georgia, as of and for the year ended June 30, 1998, as listed in the table of contents. These general purpose financial statements are the responsibility of the Thomas County Public 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 bymanagement, 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 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 ofthis omission have not been determined, but are believed to be material.
98ARL-42A

In our opinion, except for the effects on the general purpose financial statements ofthe 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 Thomas County Public Library System as of June 30, 1998, and the results of its operations and the cash flows of its nonexpendable trust fund for the year then ended, in conformity with generally accepted accounting principles.
The year 2000 supplementary information on Schedule "1" is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally ofinquiries ofmanagement regarding the methods ofmeasurement and presentation ofthe supplementary information. However we did not audit the information and do not express an opinion on it. In addition, we do not provide assurance that Thomas CountyPublic Library System is or will become year 2000 compliant, that the Library's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Thomas County Public Library System does business are or will become year 2000 compliant.
Our audit was performed for the purpose of forming an opinion on the general purpose :financial statements of the Thomas County Public Library System taken as a whole. The accompanying financial schedules (Schedules 2 through 5), as listed in the table ofcontents, are presented for purposes of additional 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 ofthe general purpose fu:i.ancial statements and in our opinion, except for the effects ofthe 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 ofthe State, as provided for by Official Code of Georgia Annotated Section 50-6-24.

RWH:jb 98ARL-42A

Russell W. Hinton State Auditor

TIIQMAS COUNTY PUBLIC LIBRARY SYSTEM

THOMAS COUNTY PUBLIC LIBRARY SYSTEM COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30. 1998

ASSETS Cash and Cash Equivalents Investments Accounts Receivable
Total Assets .
LIABILITIES AND FUND EQUITY LIABILITIES
Cash Overdraft Accounts Payable Expired Grant Balances Payable
Total Liabilities FUND EQUITY
Fund Balances Reserved For Endowment Corpus Unreserved Undesignated Total Fund Equity
Total Liabilities and Fund Equity

GOVERNMENTAL FUND

SPECIAL

GENERAL

REVENUE

FUND

FUND

$ 168,182.31 $

0.00

420.37

$ 168,602.68 $ ==========o=.o=o

$ 17,394.47 $ 17,394.47

$ 151,208.21 $

0.00

$ 1511208.21 $

0.00

s 1681602.68 s=====-===o=.o=o

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

EXHIBIT "A"

TYPES CAPITAL
PROJECTS FUND

FIDUCIARY FUND TYPE NON EXPENDABLE TRUST FUND

TOTALS {Memorandum Onl:t} JUNE 30, 1998 JUNE 30, 1997

$

9,855.47 $

260.96 $ 178,298.74 $ 228,693.56

50,000.00

5,005.66

55,005.66

61.95

482.32

61452.49

$ 59,855.47 $========51=32=8=.5=7 $ 233,786.72 $ 2351146.05

$

3,990.18

$ 17,394.47

10,023.77

61.82

$ 17,394.47 $ 141075.77

$

5,000.00 $

5,000.00 $

5,000.00

$ 59,855.47 ----=32=8=.5.-7

211 1392.25 2161010.28

$ 591855.47 $ _ _ _ _5..3..2.._.8....,.5_7 $ 216,392.25 $ 221,070.28

$ 591855.47 $-====--=-=5,=32=8=.5=7 $ 233z786.72 $ 235,146.05

-3-

THOMAS COUNTY PUBLIC LIBRARY SYSTEM COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30. 1998

EXHIBIT"B"

GENERAL FUND

SPECIAL REVENUE
FUND

CAPITAL PROJECTS
FUND

TOTALS {Memorandum Onl:z'.}
YEAR ENDED JUNE 30, 1998 JUNE 30, 1997

REVENUES
State Funds Federal Funds Local Funds Other Funds

$ 223,166.50 $
601,809.48 122,672.08

4,100.00 $

$ 3,047.74

223,166.50 $ 4,100.00
601,809.48 125,719.82

149,753.30 5,984.00
567,577.98 107,557.12

Total Revenues

$ 947,648.06 $ 4,100.00 $ 3,047.74 $ 954,795.80 $ 830,872.40

EXPENDITURES

Current Program Services Technical Services Circulation Administration Maintenance and Operations

$ 427,441.88 $ 50,998.67 168,065.19 199,882.22 106.490.03

4,100.00 $

$ 2,496.00

431,541.88 $ 50,998.67 170,561.19 199,882.22 106,490.03

279,169.75 42,169.35 175,441.26 173,905.04 92,699.93

Total Expenditures

$ 952,8n.99 $ 4,100.00 $ 2,496.00 $ 959,473.99 $ 763,385.33

Excess of Revenues over (under) Expenditures $ -5,229.93 $

0.00 $

551.74 $

-4,678.19 $

67,487.07

FUND BALANCE JULY 1

.. 156,438.14

0.00

59,303.73

215,741.87

148,254.80

FUND BALANCE JUNE 30

s 151.208.21 $-==--=o.o..o..., $ 59,855.47 $ 211,063.68 $ 215,741.87

The notes to the general purpose financial statements are an integral part of this statement -4-

THOMAS COUNTY PUBLIC LIBRARY SYSTEM STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30. 1998

EXHIBIT"C"

GENERAL FUND

BUDGET

ACTUAL

REVENUES

State Funds Federal Funds Local Funds Other Funds

$ 224,098.20 $ 223,166.50

601,809.48 109,464.75

601,809.48 122,672.08

Total Revenues

$ 935,372.43 $ 947,648.06

EXPENDITURES

Current Program Services Technical Services Circulation Administration Maintenance and Operations

$ 486,538.21 $ 427,441.88

47,250.00

50,998.67

175,003.50

168,065.19

201,833.20

199,882.22

116,841.50

106,490.03'

Total Expenditures

$ 1,027,466.41 $ 952,877.99

Excess of Revenues over (under) Expenditures $ -92,093.98 $ -5,229.93

FUND BALANCE JULY 1. 1997

161,591.58

156,438.14

Adjustments

113.18

FUND BALANCE JUNE 30. 1998

$ 69,610.78 $ 151,208.21

SPECIAL REVENUE FUND

BUDGET

ACTUAL

$ 4,100.00 $ 4,100.00 $ 4,100.00 $ 4,100.00

$ 4,100.00 $ 4,100.00

$ 4,100.00 $ 4,100.00

$

0.00 $

0.00

0.00

0.00

$

o.oo $ ___o...o..o_

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

THOMAS COUNTY PUBLIC LIBRARY SYSTEM

EXHIBIT "D"

STATEMENT OF REVENUES. EXPENSES AND CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

YEAR ENDED JUNE 30. 1998

OPERATING REVENUE None Recorded
OPERATING EXPENSES Current Library Books and Materials Operating Income (Loss}
NONOPERATING REVENUES Interest Earned Total Income (Loss}
FUND BALANCE JULY 1

JARRELL TRUST FUND

TOTALS {Memorandum Only)
YEAR ENDED JUNE 30, 1998 JUNE 30, 1997

$

0.00 $

0.00 $

0.00

$

242.39 $

242.39 $

382.81

$

-242.39 $

-242.39 $

-382.81

242.55

242.55

252.08

$

0.16 $

0.16 $

-130.73

5,328.41

5,328.41

5,459.14

FUND BALANCE JUNE 30

$

5,328.57 $

5,328.57 $ ===5=,3=28=.41=

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

THOMAS COUNTY PUBLIC LIBRARY SYSTEM STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30. 1998

EXHIBIT"E"

Cash Flows from Operating Activities: Cash Paid for Library Books and Materials
Cash Flows from Investing Activities: Purchase of Investments Interest Received on Investments
Net Cash Provided by Investment Activities
Net Decrease in Cash
Cash and Cash Equivalents - July 1

JARRELL TRUST FUND

TOTALS {Memorandum Only)
YEAR ENDED JUNE 30, 1998 JUNE 30, 1997

$

-242.39 $

-242.39 $

-382.81

$

-5,005.66 $ -5,005.66

242.39

242.39 $

190.29

$

-4,763.27 $ -4,763.27 $

-192.52

$

-5,005.66 $ -5,005.66 $

-192.52

5,266.62

5,266.62

5,459.14

Cash and Cash Equivalents - June 30

$

260.96 $

260.96 $ ====5=,2=6=6.=62=

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

THQMAS COUNTY PUBLIC LIBRARY SYSTEM

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Thomas CountyPublic Library System (Library) operates pursuant to Official Code ofGeorgia 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 ofthe Library have been prepared in conformity with generally accepted accounting principles as applied to governmental units and unless otherwise disclosed in these notes, the financial statements present all fund types and account groups ofthe Library.
The Library Board consists ofnine members appointed by the Thomas County Board ofCommissioners. The Library Board is without authority to determine the amount ofits funding, except by submission ofbudget requests to local governmental units from which the Library receives support and to the State of Georgia for State and Federal funding. The Library Board has the power to design.ate management, the power to retain unreserved fund balances oflocal and other funds for continued operations and is the lowest level ofoversight responsibility for the Library's operations.
The Thomas County Board of Commissioners appoints all ofthe Library's Board members and provides a substantial majority offunding for the operations ofthe Library, consequently, the Library is deemed to have a financial benefit/burden relationship with Thomas County, Georgia as defined by the Governmental Accounting Standards Board. Accordingly, the Thomas County Public Library System is considered to be a component unit of Thomas County, Georgia for financial reporting purposes.
FUND ACCOUNTING
The Library uses funds to report on its financial position and the results ofits 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 ofaccounts.
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 presentlymaintained 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 :financial statements account for all State, Federal, Local and Other funds under control ofthe 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:

-9-

THQMAS COUNTY PUBLIC LIBRARY SYSTEM

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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.
SPECIAL REVENUE FUND - the fund used to account for the proceeds ofspecific revenue sources (other than for major capital projects) 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.
CAPITAL PROJECTS FUND - the fund used to account for :financial resources to be used for the acquisition or construction ofmajor capital facilities.
FIDUCIARY FUND TYPE - the trust fund 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. This fund includes:
NONEXPENDABLE TRUST FUND Jarrell Trust 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 to provide Library books approved by the Library Board.
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 ofavailable spendable resources.
Liabilities which are expected to be :financed from available spendable resources are reported as liabilities in the governmental funds.
All nonexpendable trust funds are accounted for on a flow ofeconomic resources measurement focus. With this measurement focus, all assets and liabilities associated with the operation ofthese funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
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THOMA$ COUNTY PUBLIC LIBRARY SYSTEM

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

ruNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNJJNG POLICIES

Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be detennined 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.
BUDGET

The Thomas County Public Library System's budget is a complete fin8J1.~ial 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 ofthis tentative budget by the Board, copies are sent to the Thomas County

Board of Commissioners. After funding approval is received from the Thomas County Board of

Commissioners, the Board makes revisions as necessary and adopts the budget. The budget is then submitted

to the Department ofTechnical and Adult Education as a part ofthe 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

COMPOSffiON 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.

INVESTMENTS

COMPOSffiON OF INVESTMENTS Investments made by the Library in nonparticipating interest-earning contracts (such as certificates ofdeposit) and repurchase agreements are reported at cost. Both participating interest-earning contracts BJ1.d money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both . participating interest-earning contracts and money market investments with a maturity at purchase greater than

- 11 -

THOMAS COUNTY PUBLIC LIBRARY SYSTEM

EXHIBIT "F"

NOTES TO THE GENERAL PQRPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the

Library to invest its funds. In selecting among options for investment or among institutional bids for deposits,

the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds

may be invested in the following:



(1) Obligations issued by the State of Georgia or by other states,

(2) Obligations issued by the United States government,

(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,

(4) Obligations of any corporation ofthe 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 ofthe State of Georgia.

RECEIVABLES

Receivables consist ofgrant 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.

INTERFUND TRANSACTIONS

The Library has the following type ofinterfund transactions:

Reimbunements ofexpenditures/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.

-12-

THOMAS COUNTy PUBUC LIBRARY SYSTEM

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FlNANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
MEMORANDUM ONLY -TOTAL COLUMNS
Total columns on the general pmpose 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, 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. Certain reclassifications have been made to the comparative data to conform to the current year classifications.
Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code ofGeorgia 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 ofinsurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value ofsecurities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit 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.
Acceptable security for deposits consists ofany one ofor any combination ofthe following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State ofGeorgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates ofindebtedness or other direct obligations of the United States or ofthe State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities ofthe State ofGeorgia,
(5) Bonds ofany public authority created by the laws ofthe State ofGeorgia, providing that the statute that created the authority authorized the use ofthe bonds for this pmpose,
(6) Industrial revenue bonds and bonds ofdevelopment authorities created by the laws ofthe State of Georgia, and
(7) Bonds, bills, notes, certificates ofindebtedness, 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
-13-

THOMAS COUNTY PUBLIC LIBRARY SYSTEM

EXIIlBIT "F"

NOTES TO THE GENERAL P!JRPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 2: DEPOSITS

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 At June 30, 1998, the bank balances were $273,160.09. The amounts ofthe total bank balance.s are classified into three categories of credit risk:

Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities
held by the Library or by the Library's agent in the Library's name. 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, 1998, as follows:

Risk Categozy

Bank Balance

1

$ 156,707.77

2

116,452.32

3

0.00

Total

$ 273.160.09

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 and natural disaster.

The Library has obtained commercial insurance for risk of loss associated with torts, assets, errors or omissions and natural disaster. However, the error or omissions policy excludes coverage for sexual harassment and discrimination. 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 participates in the Association County Commissioners of Georgia-Self Insured Workers' Compensation Fund, a public entity risk pool organized on July 1, 1982 todevelop, implement and administer a program ofworkers' compensation self-insurance for its member organizations. The Library pays an annual premium to the Fund for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Fund with Safety National Casualty Corporation to provide coverage for potential losses by the Fund in excess of $450,000.00 loss per occurrence, up to $2,000,000.00.

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THOMAS COUNTY PUBLIC LIBRARY SYSTEM

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 3: RISK MANAGEMENT

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

Position Covered

Amount

All Employees

$ 50,000.00

Note 4: 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.

Note 5: 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 ofGeorgia {TRS), which is a cost-sharing multiple ~ployer 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 byTRS 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 ofTrustees 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

1998

100%

$ 41,272.35

1997

100%

$ 37,064.18

1996

100%

$ 33,315.78

-15 -

THOMAS COUNTY PUBLIC LIBRARY SYSTEM

SCHEDULE "1"

SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

YEAR 2000 DISCLOSURES

YEAR ENPED JUNE 30. 1998

At June 30, 1998, the Thomas County Public Library System had no outstanding contractual commitments for the purpose ofmaking computer systems and other electronic equipment year 2000 compliant. The year 2000 issue is the result ofshortcomings in many electronic data processing systems and other equipment that make operations beyond year 1999 troublesome. The year 2000 issue is ofprimary concern for the Library's financial accounting system. The following stages have been identified as necessary to implement a year 2000 compliant systems.
Awareness Stage-Encompasses establishing a budget and project plan for dealing with the year 2000 issue.
Assessment Stage - The actual process ofidentifying all ofits systems and individual components of the systems to check for compliance.
Remediation Stage - When changes are made to systems and equipment.
Validationffesting Stage - The process of ensuring that the challges made to systems and equipment will produce a year 2000 compliant system.
It will be necessary for the Library to progress through all four of these stages for each computer and/or electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversely affected. As ofJune 30, 1998, the financial accounting system was determined to be at the Awareness Stage.
The Library's financial accounting software (GENESIS) and hardware (Wang VS) is owned by the State (Georgia Department ofEducation). These systems have been determined to be critical to the Library's ability to successfully conduct operations. As ofJune 30, 1998, the State had not contracted for the remediation of either the Wang VS operating system or the GENESIS accounting software. In the subsequent period, the Georgia Department of Education remediated the Wang VS operating system and the updated operating system was installed at all GENESIS sites as ofDecember 9, 1998. The Georgia Department ofEducation
nine has remediated the GENESIS software and conducted tests at pilot sites. The remediated GENESIS
software has been provided to all libraries currently utilizing the GENESIS accounting software.

See notes to the general pmpose financial statements. -16-

THOMAS COUNTY PUBLIC LIBRARY SYSTEM SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 1998

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Technical and Adult Education, Georgia Department of Public Libraries Salaries Travel Library Materials Regular Governor's Reading Incentive Program Maintenance and Operation

GOVERNMENTAL FUND TYPE GENERAL FUND

$

107,354.20

2,238.30

23,190.00 67,194.00 23,190.00

$

223, 166.50

See notes to the general purpose financial statements. -17-

THOMAS COUNTY PUBLIC LIBRARY SYSTEM SCHEDULE OF FEDERAL REVENUE
YEAR ENDED JUNE 30. 1998
AGENCY/FUNDING GRANT Education,U.S.Departmentof Through Georgia Department of Technical and Adult Education Library Services and Construction Act Title I - Public Library Services

SCHEDULE "3"
GOVERNMENTAL FUND TYPE SPECIAL REVENUE FUND
$ ========i4'6::10=0=.o=o

See notes to the general purpose financial statements. -18-

THOMAS COUNTY PUBLIC LIBRARY SYSTEM SCHEDULE OF LOCAL REVENUE YEAR ENDED JUNE 30. 1998

SCHEDULE "4"

LOCAL SOURCE County Government Board of Commissioners Thomas

GOVERNMENTAL FUND TYPE GENERAL FUND
$ ========s_o_,1._ao_9_.4=a

See notes to the general purpose financial statements. -19-

THOMAS COUNTY PUBLIC LIBRARY SYSTEM SCHEDULE OF SALARIES AND TRAVEL YEAR ENDED JUNE 30. 1998

SCHEDULE "5"

NAME

Beckwith, Brooks, Brooks, Brunner, Byrd, Davis, Dean, Depew, Depew, Dewell, Donovan, Eden, Eleneski, Emmory, Ferrie, Floyd, Gbemeh, Goodin, Griffin, Hallman, Harden, Hardman, Harvell, Hayes, Herring, Hill, Hill I Jones, Lee, Lee, Longstreet, May, McCoy, Mccree, McKinney, Mitchell, Mitchell, Murray, Myrick, Pugh, Ramsey, Ramsey, Richards, Ryan, Sanders, Scott, Simpson,

Betty L.
DollyM. Kristy L. Lenorwood Angela C. PhillipD. Rosanne Betty
Ralph L.
Charles M. Georgie H. David E. Norma Samuel Tari J. Becky Walter HidlaS. Mildred H. EleanorT. BrandyT. Barbara
Daniel L.
Mona Rebecca A. Erica MelaneeC. Ricardo Kristi Shana A. David Sean Trish A. CharlesJ. Margarete. Jamison R. PeridaA.
Virgil L., Jr.
Janet Patrick M. Deanna Robert MaryG. Jerome Teresa C. Geneva M. Jerome K.

TITLE CATEGORY
Branch Assistant Branch Manager Branch Assistant Reference Assistant Automation Supervisor Reference Assistant Circulation Assistant Mending Assistant Security/Maintenance Assistant Maintenance Assistant Children's Manager Director Circulation Assistant Branch Assistant Bookeeper/Accountant Circulation Manager Reference Assistant Processing Manager Mending Assistant Branch Assistant Branch Assistant Children's Assistant Circulation Assistant Business Manager Branch Assistant Shelving Assistant Reference Assistant Library Assistant Branch Assistant Branch Assistant Children's Assistant Reference Assistant Processing Assistant Children's Assistant Children's Assistant Library Assistant Reference Manager Children's Assistant Branch Assistant Library Assistant Children's Coordinator Library Assistant Associate Director Security Processing Center Children's Assistant Library Assistant
-20-

SALARIES

TRAVEL

$

3,908.00

7,248.75 $

195.94

674.66

17,850.16

2,562.54

4,012.50

618.01

10,349.30

4,500.08

2,689.78

58,713.79

110.25

50.93

14,758.84

16,933.37

1,311.00

11,466.25

2,982.39

12.00

3,998.19

6,743.87

9,008.85

15,504.24

752.87

333.16

10,538.61

3,000.66

435.19

2,382.18

494.41

372.00

14,512.50

4,539.05

406.25

231.76

18,204.24

305.40

808.56

608.50

14,441.07

10.30

29,695.87

67.50

9,250.08

509.26

97.00

49.54 177.21
2,170.80
26.00 374.72
762.25 419.60 105.50 553.50

THOMAS COUNTY PUBLIC LIBRARY SYSTEM SCHEDULE OF SALARIES AND TRAVEL YEAR ENDED JUNE 30. 1998

SCHEDULE "5"

NAME

Stowers, Taylor, Taylor, Thompson, Tillinghast, Tillman, Vanier, Vowell, Welch, Wilkerson, Williams, Wilson, Wilson, Wyche,

Adrian Kari L. PeggyL. Susan S. NancyL. Alyce S. Charles Lara L. MildredW. Reginald DonnaS. Dwain L. Samuel H., Jr. Eric

TITLE CATEGORY
Library Assistant Branch Assistant Branch Manager Branch Assistant Assistant Director Assistant Circulation Manager Reference/Office Assistant Library Assistant Branch Manager Reference Assistant Branch Assistant Reference Assistant Maintenance Supervisor Library Assistant

SALARIES

TRAVEL

$

1,666.54

9,726.06

9,237.85 $

1,695.10

43,665.78

16,012.50

2,382.00

7,093.13

5,099.64

152.26

4,660.26

6,634.16

15,352.66

140.34

51.00 150.50
72.00 63.00

Totals per Report

$ 431,718.39 $===4=,9=7=5=.6=2

See notes to the general purpose financial statements. -21 -

SECTIONil FINDINGS AND QUESTIONED COSTS

THOMAS COUNTY PUBLIC LIBRARY SYSTEM
SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENPED JUNE 30. 1998
PRIQR YEAR/CURRENT YEAR
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: 7362-93-02
The audit report for the year ended June 30, 1997, noted that the management of the Thomas County Public Library System did not 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 Thomas County Public Library System did not establish a General Fixed Assets Account Group within the form.al accounting records. This condition results in the general purpose financial statements ofthe Library being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be 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, equipment and inexhaustible collections and books 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.