GA ABOCI .Rl El~ Ab 1qq3 _q4 STATE OF GEORGIA DEPARTMENT OF AUDITS 254 WASHINGTON STREET ATLANTA, GEORGIA 30334 AUDIT REPORT APPLING COUNTY BOARD OF EDUCATION BAXLEY, GEORGIA YEAR ENDED JUNE 30, 1994 APPLING COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS- SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE EXHIBITS GENERAL PURPOSE FINANCIAL STATEMENTS COMBINED STATEMENTS - OVERVIEW A COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP 2 B COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUND 4 C COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ACTUAL AND BUDGET GOVERNMENTAL FUND TYPES 6 D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS 7 ADDITIONAL FINANCIAL INFORMATION COMBINING AND INDIVIDUAL FUND STATEMENTS SPECIAL REVENUE FUND E COMBINING BALANCE SHEET 20 F COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 22 CAPITAL PROJECTS FUND G COMBINING BALANCE SHEET 24 H COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 25 FIDUCIARY FUND TYPES I COMBINING BALANCE SHEET 26 J STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCYFUND 27 SCHEDULES I SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE 28 2 ANALYSIS OF CASH AND CASH EQUIVALENTS 30 3 INVESTMENTS 31 4 ACCOUNTS RECEIVABLE 32 APPLING COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION I FINANCIAL ADDITIONAL FINANCIAL INFORMATION SCHEDULES 5 DEBT SERVICE REQUIREMENTS TO MATURITY 33 SCHEDULE OF REVENUE 6 STATE FUNDS 34 7 LOCAL AND OTHER FUNDS 35 SCHEDULE OF EXPENDITURES BY OBJECT 8 GOVERNMENTAL FUND TYPES 36 9 LOTTERY PROGRAMS 37 10 FIDUCIARY FUND TYPE EXPENDABLE TRUST FUND 38 ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS II OVERALL 39 12 BY PROGRAM 40 13 SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS 42 SECTION II COMPLIANCE COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS APPLING COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION III INTERNAL CONTROL REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS SECTION I FINANCIAL CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 25, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Appling County Board of Education INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE Ladies and Gentlemen: We have audited the general purpose financial statements (Exhibits A through D) of the Appling County Board of Education, as of and for the year ended June 30, 1994, as listed in the table of contents. These financial statements are the responsibility of the Board's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 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 financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows: * The general purpose financial statements of the Board did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles. 94ARL-13 * School activity accounts maintained at the individual schools are not included in the general purpose financial statements. To confonn to generally accepted accounting principles, these accounts should be included in the general purpose financial statements. * The Board did not recognize as expenditures, in the year ended June 30, 1994, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1994. Also funds received, subsequent to June 30, 1994, from the Georgia Department ofEducation for the State's share ofthese unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1993, were improperly recorded in the year ended June 30, 1994. To confonn to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed. The aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material. In our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements present fairly, in all material respects, the financial position of the Appling County Board of Education as of June 30, 1994, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements ofthe Appling County Board of Education taken as a whole. The combining and individual fund statements (Exhibits E through J) and the financial schedules (Schedules 1 through 13 which includes the Schedule of Federal Financial Assistance) are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the Appling County Board of Education. Such infonnation has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the effects ofthe matters referred to in the third paragraph, such infonnation is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. A copy ofthis report has been filed as a pennanent 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. I~ Claude L. Vickers State Auditor CLV:gp 94ARL-13 APPLING COUNTY BOARD OF EDUCATION - 1- APPLING COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP JUNE 30 1994 ASSETS Cash and Cash Equivalents Investments Accounts Receivable Inventories Food Donated Commodities Purchased Food Amount Available in Debt Service Fund Amount to be Provided in Future Years For Payment of: Bond Dabt Capital Lease Agreements Total Assets GENERAL FUND 4,037,972.53 84,354.80 GOVERNMENTAL FUND TYPES SPECIAL CAPITAL REVENUE PROJECTS FUND FUND 402,547.78 452,869.63 153,783.23 115,635.14 395,843.56 18,418.25 8,567.43 4,122,327.33 $ 545168.60 $ 1 002 496.42 LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payable Funds Held for Others Capital Lease Agreements General Obligation Bonds Payable Total Liabilities FUND EQUITY Fund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Dabt Service For Expired Grant Balances/Questioned Costs For Inventories Food Donated Cornmcxfrties Purchased Food For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity $ 69,516.43 $ 38,316.66 $ 984.26 126,438.70 21,181.07 883.00 106,486.88 $ 69,516.43 $ 185,936.43 $ 108,354.14 44,265.87 88,669.45 $ 132,935.32 $ 3,919,875.58 4,052,810.90 $ 18,418.25 8,567.43 26,985.68 $ 332,246.49 359,232.17 $ 9,869.00 9,669.00 884,473.28 894,142.28 Total Liabilities and Fund Equity $ 4,122,327.33 $ The notes to the general purpose financial statements are an integral part of this statement -2- 545168.60 $ 1,002 496.42 EXHIBIT"A" DEBT SERVICE FUND FIDUCIARY FUND TYPES TRUST AND AGENCY FUNDS ACCOUNT GROUP GENERAL LONG-TERM DEBT TOTALS (Memorandum Onl~! JUNE 30, 1994 JUNE 30, 1993 $ ,n1.34 s 88,755.42 $ 948,944.17 $ 1,786,244.65 190,209.01 ,381,964.n 6,973, 168.82 1,092.59 596,926.09 1,052,315.52 18,418.25 8,567.43 24,828.31 7,923.75 $ 196,072.94 196,072.94 245,203.28 23,927.06 6,852.12 23,927.06 6,852.12 89,796.72 11,401.87 $ 196 072.94 $ 88 755.42 $ 226852.12 $ 6,181 672.83 $ 10 190 882.92 $ 69,516.43 39,300.92 $ 22,016.46 126,438.70 158,313.02 21,181.07 4,748.15 883.00 422,891.36 s 14,948.13 106,486.88 14,948.13 310,997.76 16,208.08 $ 6,852.12 6,852.12 11,401.87 220,000.00 220,000.00 335,000.00 $ 14,948.13 $ 226,852.12 $ 605,607.25 $ 1,281,576.70 $ 196,072.94 196,072.94 0.00 $ $ 196,072.94 $ 196 072.94 $ 73,807.29 73,807.29 $ 44,265.87 $ 131,895.95 135,383.50 196,072.94 245,203.28 88,669.45 33,768.80 18,418.25 8,567.43 9,669.00 24,828.31 7,923.75 151,253.20 $ 365,662.94 $ 730,256.79 5,210,402.64 8,179,049.43 5,576,065.58 $ 8,909,306.22 88,755.42 $ 226,852.12 $ 6,181,672.83 $ 10,190,882.92 3. APPLING COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUND YEAR ENDED JUNE 30 1994 REVENUES S-Funds Fedenil Funds Local and Other Funds Total Revenues EXPENDITURES Current Instruction Support Services PupiSe!vices Improvement af Instructional Services Educational Media Se!vices General Administration School Adminlstration Business Administration Maintenance and Operation af Plant Student Transpor1ation Services Central Support Services Other Support Services Food Services Operation Community Service Operations Other Operations af Non-Instructional Services Capital Outlay Debt Service Principal Interest Paying Agent Fees Total Expenditures Excess af Revenues over (under) Expen/TER PROGRAMS Total Thirteen Weighted and Media Center STAFF QEVfl OPMENT PROGRAMS (1) Cost a Instruction Professional Development Total Staff OeYelopment () Identifies Thirteen Weighted Programs Note (1) $9,688.35 of the allotment tor Professional Development has been transferred to Cost of Instruction as authorized by OCGA 20-2-182. See notes to the general purpose financial statements. ALLOTMENTS FROM DEPARTMENT OF EDLICATION REQUIRED TOTAL ORIGINAL _,!_ ORIGINAL Ml~TERM REQUIRED 566,460.00 509,814.00 $ 0.00 $ 509,814.00 1 451 082.00 1305973.80 1305973.80 2,017,542.00 90 $ 1,815,787.80 $ 0.00 $ 1,815,787.80 825,770.00 90 743,193.00 743,193.00 1,330,980.00 90 1,197,882.00 1,197,882.00 1,041,505.00 90 937,354.50 937,354.50 321,949.00 90 289,754.10 289,754.10 381 792.00 90 343612.80 343612.80 $ 5 919 538.00 5 327 584.20 $ ----"o"'.oo~ s s 321 584.20 1,036,730.00 933,057.00 $ 0.00 $ 933,057.00 1,036,730.00 20 593.00 1057323.00 245,531.00 256,724.00 90 $ 90 90 $ 90 $ 933,057.00 $ 18 533.70 951 590.70 $ 220 977.90 $ 231 051.60 $ $ 7,479,116.00 6,731 204.40 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 933,057.00 18 533.70 951,590.70 220 977.90 231 051.80 0.00 $ 6 731,204.40 28,402.35 100 $ 54,900.65 100 28,402.35 $ 54 900.65 83,303.00 83,303.00 $ 0.00 $ 28,402.35 54900.65 o.oo s____s_3_303=.oo"- 7,562,419.00 s s a14,so1.40 s _ _ _ _o_.o_o s s 814 507.40 . 40 SCHEDULE ''12'' REQUIRED ALLOTMENT SALARIES ACTUAL DISTRIBUTION BY RESPECTIVE PORTIONS AMOUNT OF UNDEREXPENDITURE FOR REQUIRED ALLOTMENT REQUIRED ALLOTMENT OPERATIONS ACTUAL AMOUNT OF UNDEREXPENDITURE FOR REQUIRED ALLOTMENT 497,312.10 $ 617,669.67 12,501.90 $ 22,742.02 1 267115.40 1 896,307.37 38 858.40 77,414.78 1,764,427.50 s 2,513,977.04 $ 0.00 51,360.30 $ 100,156.80 $ 0.00 721,890.90 1,004,860.10 0.00 21,302.10 65,603.88 0.00 1,164,640.50 1,528,362.46 0.00 33,241.50 79,759.87 0.00 898,731.90 1,264,469.19 0.00 38,622.60 130,941.07 0.00 277,862.40 309,736.71 0.00 11,891.70 18,175.09 0.00 301 628.70 617 817.34 0.00 41,984.10 178 223.28 0.00 $ 5129181.90 $ 7 239 222.84 $ 0.00 198 402.30 $ 572 859.99 $ 0.00 11,605.50 $ 228,556.80 581,867.10 82,533.60 4,391.10 1 602.00 11,812.91 247,260.20 589,665.68 149,592.66 554.40 $ 4,557.60 14,757.30 2,631.60 824.05 3,637.97 35,830.35 22,284.87 910,556.10 $ 998,331.45 $ 0.00 22,500.90 $ 62,577.24 $ 0.00 18,054.90 67 255.29 $ 0.00 478.80 3,010.62 $ 0.00 928 611.00 $ 1,065,586.74 22 979.70 $ 65,587.86 217 328.40 $ 276,345.46 $ 0.00 3 649.50 $ 3,649.50 $ 0.00 180 693.00 $ 354 976.38 $ 0.00 50 358.60 $ 80 922.70 $ 0.00 6 455,814.30 $ 8,936,131.42 $ 0.00 275,390.10 $ 723,020.05 $ 0.00 6 455 814.30 $ 8,936,131.42 $ 28,402.35 $ 54,900.65 83,463.54 $ 0.00 54,900.65 83 303.00 $ 83,463.54 S 54 900.65 0.00 358,693.10 $ 806,483.59 $ 54 900.65 - 41 - APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS YEAR ENDED JUNE 30 1994 SCHEDULE "13" BOARD MEMBER ADDRESS Mr. Doug Harris, Chairman () Route 7, Box 1155 Baxley, Georgia 31513 Mr. John W. Aycock () Route 8, Box 680 Baxley, Georgia 31513 Mr. H. Virgil Carter() Route 5, Box 1400 Baxley, Georgia 31513 Mr. Phil Jenkins () Route 5, Box 265 Baxley, Georgia 31513 Mr. Deraimus Walker (J 708 Hopps Street Baxley, Georgia 31513 COMPENSATION TRAVEL $ 4,600.00 $ 884.03 3,300.00 216.13 4,600.00 878.50 3,600.00 496.15 5,000.00 614.91 $ 21,100.00 $ 3,089.72 (J Denotes Board Members Serving as of June 30, 1994 See notes to the general purpose financial statements. - 42 - SECTION II COMPLIANCE CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 25, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members of the Appling County Board of Education COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Appling County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 25, 1995. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. 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. Compliance with laws, regulations, contracts, and grants applicable to Appling County Board of Education is the responsibility ofthe Board's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Board's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. The results of our tests indicate that, with respect to the items tested, the Appling County Board ofEducation complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Board had not complied, in all material respects, with those provisions. 94CRL-10 This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~~ Claude L. Vickers State Auditor CLV:gp 94CRL-10 CLAUDE L. VICKERS STATE AUDITOR j404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 25, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members of the Appling County Board of Education SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Appling County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 25, 1995. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have applied procedures to test the Appling County Board ofEducation's compliance with the following requirements applicable to each of its Federal financial assistance programs, which are listed in the Schedule ofFederal Financial Assistance, for the year ended June 30, 1994: ( 1) Political Activity (5) Allowable Costs/Cost Principles (2) Civil Rights (6) Audit Follow-Up/Resolution (3) Cash Management (7) Administrative Requirements (4) Federal Financial Reports Our procedures were limited to. the applicable procedures described in the Office of Management and Budget's "Compliance Supplement for Single Audits of State and Local Governments" and other additional procedures as deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which is the expression ofan opinion on the Appling County Board ofEducation's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. 94CRL-50 With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that the Appling County Board ofEducation had not complied, in all material respects, with those requirements. However, the results of our procedures disclosed an immaterial instance ofnoncompliance with those requirements, which is described in the Schedule ofFindings and Improper or Questioned Costs. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. ~-=~ Claude L. Vickers State Auditor CLV:gp 94CRL-50 CLAUDE L. VICKERS STATE AUDITOR (404) 6562174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 25, 1995 Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Appling County Board of Education SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Appling County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 25, 1995. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Appling County Board ofEducation's compliance with the requirements governing: (1) Types of Services Allowed or Unallowed (5) Applicable Special Tests and Provisions (2) Eligibility (3) Matching, Level ofEffort, and/or Earmarking (6) Other Requirement Claims for Advances and Reimbursements (4) Reporting These requirements are applicable to the major Federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance, for the year ended June 30, 1994. The management of the Appling County Board ofEducation is responsible for the Board's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. 94CRL-80 We conducted our audit ofcompliance in accordance with generally accepted auditing standards; Government Auditing Standards issued by the Comptroller General of the United States; and Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Board's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the Appling County Board of Education complied, in all material respects, with the requirements as disclosed in the second paragraph that are applicable to its major Federal financial assistance programs for the year ended June 30, 1994. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~~ Claude L. Vickers State Auditor CLV:gp 94CRL-80 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 25, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members of the Appling County Board of Education SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Appling County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated July 25, 1995. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. In connection with our audit ofthe fiscal year 1994 general purpose financial statements of the Appling County Board of Education and with our consideration of the Board's internal control structure used to administer Federal financiai assistance programs, as required by Office of Management and Budget (0MB) Circular A128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1994. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governing: (1) Types of Services Allowed or Unallowed (2) Eligibility Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Appling County Board of Education's compliance with these requirements. Accordingly, we do not express such an opinion. 94CRL-120 With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Appling County Board of Education had not complied, in all material respects, with those requirements. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, c:f~ Claude L. Vickers State Auditor CLV:gp 94CRL-120 SECTION III INTERNAL CONTROL CLAUDE L. VICKERS STATE AUDITOR (404) 6562174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 25, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Appling County Board ofEducation REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Appling County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated July 25, 1995. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We conducted our audit in accordance with generally accepted auditing standards, and Government Auditing Standards, issued by the Comptroller General of the United States. 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. In planning and performing our audit ofthe general purpose financial statements of the Appling County Board of Education for the year ended June 30, 1994, we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure. The management of the Appling County Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs ofinternal control structure policies and procedures. The objectives ofan internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation ofgeneral purpose financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not 94ICL-3 be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purposes of this report, we have classified the significant internal control structure policies and procedures in the followirg categories: (I) Cash and Cash Equivalents (2) Investments (3) Inventories (4) Revenue/Receivables/Receipts (5) Procurement (6) Expenditures/Liabilities/ Disbursements (7) Employee Compensation (8) General Ledger (9) General Fixed Assets For all ofthe internal control categories listed above, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements. As described in the Schedule ofFindings and Improper or Questioned Costs, reportable conditions were noted in the following control categories: (1) Accounting Controls (Overall) (2) General Fixed Assets A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that all of the reportable conditions disclosed above are also considered to be material weaknesses. 94ICL-3 These conditions were considered in detennining the nature, timing, and extent of the procedures to be performed in our audit ofthe Appling County Board ofEducation's financial statements and this report does not affect our report thereon dated July 25, 1995. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~ Claude L. Vickers State Auditor CLV:gp 94ICL-3 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 25, 1995 Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Appling County Board ofEducation SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Appling County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated July 25, 1995. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Appling County Board of Education's compliance with requirements applicable to major Federal financial assistance programs and have issued our opinion thereon dated July 25, 1995. We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Appling County Board of Education complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program. In planning and performing our audit for the year ended June 30, 1994, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the Board's general purpose financial statements and on its compliance with requirements applicable to major Federal financial assistance programs and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated July 25, 1995. . 94ICL-7 The management ofthe Appling County Board ofEducation is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs ofinternal control structure policies and procedures. The objectives ofan internal control structure are to provide management with reasonable, but not absolute, assurance that, assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance may nevertheless occur and not be detected. Also, projection ofany evaluation ofthe structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering Federal financial assistance programs in the following control categories: GENERAL REQUIREMENTS SPECIFIC REQUIREMENTS (1) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports (1) Types of Services Allowed or Unallowed (2) Eligibility (3) Matching, Level ofEffort, and/or Earmarking (5) Allowable Costs/Cost Principles (4) Reporting (6) Audit Follow-Up/Resolution (7) Administrative Requirements (5) Applicable Special Tests and Provisions (6) Other Requirement Claims for Advances and Reimbursements For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. During the year ended June 30, 1994, the Appling County Board of Education expended 69% of its total Federal financial assistance under major Federal financial assistance programs. We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with general requirements and specific requirements, as described above that are applicable to each of the Board's major Federal financial assistance programs, which 94ICL-7 are identified in the Schedule ofFederal Financial Assistance. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. We noted a certain matter involving the internal control structure and its operation that we consider to be a reportable condition under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control structure that, in our judgment, could adversely affect the Board's ability to administer Federal financial assistance programs in accordance with applicable laws and regulations. As descnbed in the Schedule ofFindings and Improper or Questioned Costs, a reportable condition was noted in the following control category: Administrative Requirements A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control structure policies and procedures used in administering Federal financial assistance would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition described above is also considered to be a material weakness. This condition was considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Appling County Board ofEducation's compliance with requirements applicable to its major Federal financial assistance programs for the year ended June 30, 1994, and this report does not affect our report thereon dated July 25, 1995. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies and should not be used for any other purpose. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~ Claude L. Vickers State Auditor CLV:gp 94ICL-7 SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 PRIOR YEAR AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $33,768.80 Audit Control Number 6011-93-03 The audit report for the year ended June 30, 1993, disclosed that the Staff Development - Professional Development Program had an underexpenditure of Quality Basic Education (QBE) funds of$33,768.80 for the required minimum allotment. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department of Education to refund this underexpenditure as required. The underexpenditure of$33,768.80 should be returned to the Georgia Department of Education through an increase in the Board's local fair share for QBE programs in a subsequent fiscal year. AUDIT FOLLOW-UP/RESOLUTION Improper Expenditure Financial Statements Finding Resolved Audit Control Number 6011-93-04 The audit report for the year ended June 30, 1993, called attention to an improper expenditure of$197.10 by the Board for marching auxiliary' s summer camp and a graduation celebration trip. Subsequent to the year under review, reimbursement of$ I97.10 was received and deposited to the Board's General Fund. AUDIT FOLLOW-UP/RESOLUTION Inadequate Inventory Records Federal Financial Assistance Finding Resolved Audit Control Number 6011-93-05 The audit report for the year ended June 30, 1993, stated that the Board's property management records maintained for Elementary and Secondary Education Act - Chapter I - Education of Deprived Children Program (CFDA 84.010) were incomplete and failed to meet Federal property management standards as set forth in Chapter 8 of the Georgia Financial Accounting Handbook for Local School Systems. In the year under review, it was noted that property management records were maintained as required. AUDIT FOLLOW-UP/RESOLUTION Failure to Retain Records Federal Financial Assistance Finding Resolved Audit Control Number 6011-93-06 The audit report for the year ended June 30, 1993, stated that the Board did not provide information used in the determination oflow income families or the ranking of attendance areas for Part I, Section IV and VI of APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 PRIOR YEAR AUDIT FOLLOW-UP/RESOLUTION Failure to Retain Records Federal Financial Assistance Finding Resolved Audit Control Number 6011-93-06 the Elementary and Secondary Education Act - Chapter 1 (CFDA 84.010) grant application. After further review by the Georgia Department of Education, it was determined in a letter dated June 1, 1995, that a reclaim of funds was not necessary. In addition, in the year under review, the Board established procedures to provide appropriate documentation. PRIOR YEAR/CURRENT YEAR ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 6011-93-01 The audit report for the year ended June 30, 1993, stated that the Board did not provide for adequate separation ofemployee duties in the performance ofaccounting functions and related procedures for all funds. For the year under review, our audit noted no improvements regarding adequate separation of employee duties. This deficiency was a result of management's decision to limit the number of administrative staff made responsible for accounting functions. Management should periodically review this decision to determine if employee duties can be reassigned to achieve a higher degree of internal control with existing staff. Note: All Federal financial assistance programs listed in the Schedule of Federal Financial Assistance, Schedule "l" of this report are affected by this finding. GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 6011-93-02 The audit report for the year ended June 30, 1993, noted that the management of the Appling County Board ofEducation 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 Board 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 Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of the General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned APPLING COUNfY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED ruNE 30 1994 PRIOR YEAR/CURRENT YEAR GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 6011-93-02 by the Board 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. CURRENT YEAR EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $54,900.65 Audit Control Number 6011-94-01 For the year under review, the Board reported to the Georgia Department of Education on DE form 0420 "General Fund QBE Program Expenditure Summary" expenditures totaling $83,463.54 for the Staff Development - Cost ofInstruction Program. A review ofthe underlying source documentation for the Quality Basic Education (QBE) Program disclosed that the Board expended more than 15 percent of its initial allotment offunds for Professional Development Stipends for StaffDevelopment - Cost oflnstruction Program purposes resulting in an underexpenditure of$54,900.65 for the minimum required allotment of$54,900.65 for the StaffDevelopment - Professional Development Stipends Program. This questioned cost resulted from management's reliance on incorrect information received from the Georgia Department ofEducation, resulting in a violation of Official Code of Georgia 20-2-182. These funds should be returned to the Georgia Department of Education through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period. AUDIT FOLLOW-UP/RESOLUTION Audit Distribution Requirements Federal Financial Assistance Nonmaterial Noncompliance Finding Resolved Audit Control Number 6011-94-02 The Board failed to submit a copy of the 1993 audit report to the Georgia Department of Human Resources from whom the Board received Job Opportunities and Basic Skills Training Program (CFDA 93 .56 I) funds. Paragraph 13fofOMB Circular A-128 requires that the recipients ofFederal financial assistance submit copies APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 CURRENT YEAR AUDIT FOLLOW-UP/RESOLUTION Audit Distribution Requirements Federal Financial Assistance Nonmaterial Noncompliance Finding Resolved Audit Control Number 6011-94-02 ofsingle audit reports to those agencies providing Federal financial assistance. Even though formally notified in writing of these report distribution responsibilities by the Department of Audits, management indicated it was unaware ofthis audit distnbution requirement. Procedures should be implemented to ensure that reports are submitted to grantor agencies in accordance with audit distribution requirements. Subsequent to June 30, 1994, the Board submitted a copy ofthe 1993 audit report to the Georgia Department of Human Resources as required. Note: The Appling County Board ofEducation was provided an opportunity to include pertinent comments from the Board's management concerning these audit findings, conclusions and recommendations. The Board has elected not to provide comments for inclusion in this report.