Appling County Board of Education,Baxley, Georgia,report on audit of the financial statements for the fiscal year ended June 30, 2001, June 30, 2001

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APPLING COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATIONSCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

EXHffiITS

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

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

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

18

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

20

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

22

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

23

I

FIDUCIARY FUND TYPE

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUND

24

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

25

2 SCHEDULE OF STATE REVENUE

27

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

29

APPLING COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

ALLOTMENTS AND EXPENDITURES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

30

5

BY SITE

31

SECTIONTI
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH
orvrn CIRCULAR A-I33

SECTION ill AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS

SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

RUSSEl.l. \V. HI~T():-';
STATE AUDITOR
(.04) 65~2174

DEPARTMENT OF AUDITS AND ACCOUNTS
25~ Washington Street. S.\\'.. Suite 214 Atlanta, Georgia 30334-X400
March 13,2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Appling County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATIONSCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general-purpose financial statements of the Appling County Board of Education, as of and for the year ended June 30, 2001, as listed in the table of contents. These general-purpose financial statements are the responsibility of the Appling County Board of Education'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 auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial 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 of Education'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:

2001ARL-13

* The general-purpose financial statements of the Board of Education did not contain a
General Fixed Assets Account Group to account for property and equipment owned by the Board of Education which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the
general-purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general-purpose financial statements.
* The Board of Education did not recognize as expenditures, in the year ended
June 30, 2001, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2001. Also funds received, subsequent to June 30, 2001, from the Georgia Department of Education for the State's share of these 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, 2000, were improperly recorded in the year ended June 30, 2001. To conform 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 referred to above present fairly, in all material respects, the financial positio~ of the Appling County Board of Education as ofJune 30, 2001, and the results of its operations for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated March 13, 2002, on our consideration of the Appling County Board of Education's internal control over . financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Appling County Board of Education taken as a whole. The accompanying combining and -individual fund statements (Exhibits E through I) and the financial schedules (Schedules 1 through 5), which includes the Schedule ofExpenditures ofFederal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits o!States, Local Governments, and Non-Profit Organizations, 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
200lARL-13

auditing procedures applied in the audit of the general-purpose financial statements and in our opinion, except for the effects of the matters referred to in the third paragraph, such information is fairly stated, 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 ofthe State Auditor and made available to the press of the State, as provided for by Official Code ofGeorgia Annotated Section 506-24.
Respectfully submitted,
w.~
Ru ell W. Hinton State Auditor
RWH:gp 2001ARL-13

APPLING COUNTY BOARD OF EDUCATION

APPLING COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30, 2001

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Prepaid Items
Inventories Food Donated Commodities Purchased Food

GOVERNMENTAL FUND

SPECIAL

GENERAL

REVENUE

FUND

FUND

$ 3,722,858.22 $

114,522.27

279,033.18

214,000.00

205,262.21

277,486.22

984.92

28,801.71 21,762.48

Total Assets

$ 4,208,138.53 $ ===65=:;60;;,5=72=.=68=

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Retainages Payable Deferred Revenue
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For SPLOST Projects Unreserved Designated for Self-Insurance Undesignated
Total Fund Equity

$

43,065.61

$

1,632.78

218,430.70

11.62

95,036.26

29,521.99

$

1,644.40 $

386,054.56

$

22,992.78

$
63,731.77 4,119,769.58
$ 4,206,494.13 $

28,801.71 21,762.48
219,953.93 270,518.12

Total Liabilities and Fund Equity

$ 4,208,138.53 $ ===65;;,;6..,.5=7,;;,2;,;;.6~8

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
AGENCY FUND

TOTALS

(Memorandum Only)

JUNE 30, 2001

JUNE 30, 2000

$

396,372.10

$ 4,233,752.59 $ 3,765,785.82

2,046,128.49

2,53Q,161.67

845,368.90

349,850.56 $

29,953.27

862,552.26

673,940.15

984.92

28,801.71 21,762.48

25,480.31 15,558.19

$ 2,792,351.15 $

29,953.27 $ 7,687,015.63 $ 5,326,133.37

$

29,953.27 $

29,953.27

43,065.61 $

55,552.57

220,063.48

258,740.26

95,047.88

37,708.41

$

1,000.00

1.000.00

29.641.35

29.521.99

$

1,000.00 $

29,953.27 $

418,652.23 $

381,642.59

$ 2,164,495.41
626,855.74 $ 2,791,351.15

$

22.992.78

$

47,758.31

72.50

28,801.71 21,762.48 2,164,495.41

25,480.31 15,558.19

63,731.77 4,966,579.25

66.596.27 4,789,025.20

$ 7,268,363.40 $ 4,944,490.78

$ 2,792,351.15 $

29,953.27 $ 7,687,015.63 $ 5,326,133.37

- 3

APPLING COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 2001

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

$ 12,614,693,71 $
8,880,629,82 392,074.40
$ 21,887,397,93 $

829,871.06 3,286,833.01
310,493.45
4,427,197.52

$ 14,413,680.24 $

774,183.74 526,300,51 686,975.84 406,154,09 1,278,320.19 127,661,20 1,791,434.80 1,059,656.66
1,006.42 26,145.70

4,433.91 94,675,96

$ 21,190,629.26 $

$

696,768.67 $

1,980,176,87
137,006.64 166,619.84
144,518,87
8,214.81 32,782.08
650,294.44 1,408,394.89
137,954.22 22,205.97
4,688,168.63
-260,971,11

$ $ 309,028.78
$ -309,028.78 $

59,675.30 59,675.30

$

387,739.89 $

3,818,754,24

-201,295.81 462,288.24

3,321.40 6,204.29

FUND BALANCE JUNE 30

$ 4,206,494.13 $ ====27=0=,5=1=8..1..2==

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

EXHISIT"S"

CAPITAL PROJECTS
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$ 13,444,564.77 $ 12,515,307.26

3,286,833.01

2,637,526.55

$ 2,134,339.01

11,014,968.83

9,021,938.71

58,809.04

761 ,376.89

860,310.31

$ 2,193,148.05 $ 28,507,743.50 $ 25,035,082.83

$ 16,393,857.11 $ 15,114,460.13

$

314,598.68

911,190.38 692,920.35 686,975.84 550,672.96 1,278,320.19 127,661.20 1,799,649.61 1,092,438.74
1,006.42 676,440.14 1,408,394.89 142,388.13 431,480.61

1,222,141.31 866,406.90 677,647.77 410,636.40
1,172,330.14 125,025.42
1,673,943.85 1,134,661.34
406,367.76 1,347,624.10
8,729.96 924,541.99

$

314,598.68 $ 26,193,396.57 $ 25,084,517.07

$ 1,878,549.37 $ 2,314,346.93 $

-49,434.24

$

249,353.48 $

309,028.78 $

385,277.71

-309,028.78

-385,277.71

$

249,353.48 $

0.00 $

0.00

$ 2,127,902.85 $ 2,314,346.93 $

-49,434.24

663,448.30

4,944,490.78

5,009,408.53

3,321.40 6,204.29

-12,941.72 -2,541.79

$ 2,791,351.15 $ 7,268,363.40 $ 4,944,490.78 - 5-

APPLING COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GMP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2001

EXHIBIT C

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 12,034,487.70 $ 12,614,693.71

132,502.18

8,848,540.00

8,880,629.82

123,500.00

392,074.40

Total Revenues EXPENDITURES

$ 21,139,029.88 $ 21,887,397.93

Current Instruction Su pport Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations
Capital Outlay

$ 14,800,023.43 $ 14,413,680.24

717,627.70 528,428.63 681,837.27 414,799.33 1,284,988.10 125,079.07 1,754,180.00 1,070,674.00
26,145.70

774,183.74 526,300.51 686,975.84 406,154.09 1,278,320.19 127,661.20 1,791,434.80 1,059,656.66
1,006.42 26,145.70

290,000.00

4,433.91 94,675.96

Total Expenditures

$ 21,693,783.23 $ 21,190,629.26

Excess of Revenues over (under) Expenditures

$ -554,753.35 $

696,768.67

OTHER FINANCING SOURCES (USES)

Other Sources Other Uses

$ -309,028.78

Total Other Financing Sources (Uses)

$ -309,028.78

Excess of Revenues and Other Financing Sources

over (under) Expenditures and Other Financing

Uses

$

-554,753.35 $

387,739.89

FUND BALANCE JULY 1, 2000

3,638,086.36

3,818,754.24

Adjustments Food Inventory - Net Change in Period
Donated Commodities Purchased Food

780.00

FUND BALANCE JUNE 30, 2001

$ 3,084,113.01 $ 4,206,494.13

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 726,132.14 $ 829,871.06

2,264,507.47

3,286,833.01

327,877.42

310,493.45

$ 3,318,517.03 $ 4,427,197.52

$ 1,531,105.77 $ 1,980,176.87

179,942.47 190,011.76

137,006.64 166,619.84

56,244.00

144,518.87

10,320.00

8,214.81 32,782.08

60,181.00 1,375,559.36
5,000.00

650,294.44 1,408,394.89
137,954.22 22,205.97

$ 3,408,364.36 $ 4,688,168.63

$ -89,847.33 $ -260,971.11

$

59,675.30

$ 59,675.30

$ -89,847.33 $ -201,295.81

488,675.05

462,288.24

1,398.90

3,321.40 6,204.29

$ 400,226.62 $ 270,518.12

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

APPLING COUNTY BOARD OF EDUCATION

EXHmIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Appling County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.
General Fixed Assets 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 School District. 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.
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general-purpose financial statements.
The general-purpose financial statements account for all State, Federal, Taxes and Other funds under control of the School District, 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 - are used to account for all or most of a School District's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the School District except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.
-7-

APPLING COUNTY BOARD OF EDUCAnON

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
FIDUCIARY FUND TYPE - the 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. This fund includes:
AGENCY FUNDS - the funds used to account for assets held in a fiduciary capacity 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 generally are included on the balance sheet. Operating statements ofthese 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 resou~ces.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds.
Agency funds are purely custodial in nature and do not involve measurement ofresults ofoperations.
Governmental funds are accounted for using the modified accrual basis ofaccounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. The School District considers receivables collected within sixty days after yearend to be available and therefore susceptible to accrual. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, local option sales taxes, intergovernmental grants and donations. Revenue for property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year the resources are received or susceptible to accrual. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 2001, a
-8-

. . "

'

,

APPLING COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
substantial number ofpersonnel of the School District were employed for a one hundred and ninety day period beginning in August 2000 and ending in late May 2001. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 2000 and ending in August 2001. State grants to fund the State's share of these contracts- were disbursed from the Georgia Department of Education to the School District in the same twelve months. As of June 30, 2001, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 2001, had not been made. Payments for these two months were made and recorded as expenditures by the School District subsequent to June 30,2001. Alsq, the State's portion ofthecompensation paid in July and August 2001 was received and recorded as revenue in the fiscal year subsequent to June 30, 2001. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were recorded in the year ended June 30, 2001. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
Agency funds are accounted for using the modified accrual basis ofaccounting in recognizing assets and liabilities.
BUDGET
The Appling County Board of Education's budget is a complete financial plan for the School District's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure ofthe budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the School District's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the School District to deposit its funds in one or more solvent banks or insured Federal savings and loan associations.
-9-

APPLING COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the School District 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 of the United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
(8) Obligations of other political subdivisions of the State of Georgia.
RECEIVABLES
Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed 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.
PROPERTY TAXES
The Appling County Board of Commissioners fixed the property tax levy for the 2000 tax year (calendar year) on October 12,2000 (levy date). Taxes were due on January 12,2001 (lien date).
- 10-

APPLING COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2001. The Appling County Tax Commissioner bills and collects the property taxes for the School District. Property tax revenues during the fiscal year ended June 30, 2001 for maintenance and operations amounted to $8,861,021.88.

The tax millage rate levied for the 2000 tax year (calendar year) for the Appling County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

15.37 mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $2,134,339.01 and was recorded in the Capital Projects Fund. The State will tenninate collection ofthis tax once an additional $7,865,660.99 has been collected or on June 30, 2005, whichever occurs first.

INVENTORIES

FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

PREPAID ITEMS

Payments made to vendors for services that will benefit periods subsequent to June 30, 2001, are recorded as prepaid items.

COMPENSATED ABSENCES

Compensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service 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 forthe current portion of this obligation as this amount is deemed immaterial to the general-purpose financial statements.

- 11 -

APPLING COUNTY BOARD OF EDUCATION

EXHffiIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Additionally, the dollar value of accumulated 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 ofthese financial statements.
INTERFUND TRANSACTIONS
The School District has the following types of interfund transactions:
Reimbursements of expenditures initially made from a fund that ani properly applicable to another fund are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.
Operating transfers are recorded for all interfund transactions other than reimbursements.
MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general-purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results ofoperations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this 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 ofmoney which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate ofthe face
value of such surety bond and the market value of securities pledged shall be equal to not less than
11 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance.
If a depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe
securities pledged to secure a pool ofpublic funds shall be not less than 11 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) 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 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,
- 12 -

APPLING COUNTY BOARD OF EDUCAnON

EXHIDIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 2: DEPOSITS AND INVESTMENTS

(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,

(4) Bonds, bills,. notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,

(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,

(6) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia, and

(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

CATEGORIZAnON OF DEPOSITS At June 30, 2001, the bank balances were 5,648,962.20. The amounts ofthe total bank balances 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 School District or by the School District's agent in the School District's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the School District'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 School District's name.)

The School District's deposits are classified by risk category at June 30, 2001, as follows:

Risk Category

Bank Balance

1

$ 296,987.41

2

885,974.79

3

4.466.000.00

Total

$ 5.648.962.20

- 13 -

----------------- ------

APPLING COUNTY BOARD OF EDUCATION

EXHffiIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 2: DEPOSITS AND INVESTMENTS
CATEGORIZAnON OF INVESTMENTS At June 30, 2001, the carrying value of the School District's total investments was $2,307,981.61 which is materially the same as fair value. This investment consisted entirely of funds invested in the Local Government Investment Pool administered by the State ofGeorgia, Office ofTreasury and Fiscal Services which are not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy ofthe State ofGeorgia, Office of Treasury and Fiscal Services for the Local Government Investment Pool (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description ofthe Primary Liquidity Portfolio is as follows:
The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. The pool is not registered with the SEC as an investment company but does operate Georgia Fund 1 in a manner consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and is considered to be a Rule 2a7 like pool. The pool's primary objectives are safety of capital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ~nsure stability. The pool distributes earnings (net of management fees) on a monthly basis and values participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value ofthe shares. Participation in the pool is voluntary and deposits consist of funds from local governments; operating and trust funds of Georgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund.
Investments in Georgia Fund 1 and Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average maturity of Georgia Fund 1 J11ay not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2001, was 39 days. The average investment duration for Fund 6 on June 30, 2001, was 6 months.
Note 3: NON-MONETARY TRANSACTIONS
The School District receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories
Note 4: RISK MANAGEMENT
The School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation.
- 14-

APPLING COUNTY BOARD OF EDUCATION

EXHffiIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 4: RISK MANAGEMENT

The School District has obtained commercial insurance for risk ofloss associated with torts, assets and ,errors or omissions. The School District has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the School District's insurance coverage in any of the past three years.

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

The School District is self-insured with regard to unemployme'nt compensation claims. In connection with this program, a self-insurance reserve has been established within the General Fund by the School District. The School District 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 of that loss can be reasonably estimated.

Changes in the unemployment compensation claims liability during the last two fiscal years are as follows:

2000 2001

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

$

0.00 $

5,016.00 $

2,904.00 $

2,112.00

$

2,112.00 $

0.00 $

2,112.00 $

0.00

The School District participates in the Georgia Education Workers' Compensation Trust, a public entity risk pool organized on December 1,1991, to develop, implement and administer a program of workers' compensation self-insurance for its member organizations. The School District pays an annual premium to the Trust for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Trust with the United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Trust in excess of $250,000.00 loss per occurrence, up to $2,000,000.00.

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

Position Covered

Amount

Superintendent Each Employee
Note 5: ON-BEHALF PAYMENTS

$ 100,000.00 $ 10,000.00

The School District has recognized revenues and expenditures in the amount of $329,310.25 for health insurance and retirement contributions paid on the School District's behalfby the following State Agencies.

- 15 -

APPLING COUNTY BOARD OF EDUCATION

EXHffiIT "0"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 5: ON-BEHALF PAYMENTS
Georgia Department of Education Paid to the Georgia Department of Community Health , For Health Insurance of Non-Certified Personnel In the amount of $248,602.58
Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$41,560.67
Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of$39,147.00
Note 6: 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 School District believes that such disallowances, if any, will be immaterial to its overall financial position.
The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance ofroutine School District operations. The ultimate disposition ofthese proceedings is not presently determinable, but is not believed to be material to the general-purpose financial statements.
Note 7: ACCUMULATED EMPLOYEES' LEAVE
Noncertified employees earn annual leave ranging from five to fifteen days each year depending upon the employee's length of continuous service with a maximum of fifteen days. Employees are paid, at the current rate of pay, for unused accumulated leave upon retirement or termination of employment. See Note 1 - C0":lpensated Absences
Note 8: RETIREMENT PLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)
TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school districts are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement
- 16 -

APPLING COUNTY BOARD OF EDUCAnON

EXHffiIT "0"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 8: RETIREMENT PLANS

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 School District who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The School District 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 11.29% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2001 2000 1999

100% 100% 100%

$ 1,725,707.15 $ 1,598,920.30 $ 1,609,270.04

- 17-

APPLING COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2001

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Food Donated Commodities Purchased Food
Total Assets
LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity
Total Liabilities and Fund Equity
See notes to the general-purpose financial statements. - 18 -

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

48,636.67 $

100,671.31

214,000.00

13,837.62

28,801.71 21,762.48

$

327,038.48 $ ==~10;;,;;;O;o;;,6;,;,,7,,;,;1.~3~1

$

6,940.50 $

16,004.37

49,579.86

76,666.94

8,000.00

$

56,520.36 $

100,671.31

/

$

28,801.71

21,762.48

219,953.93 $

0.00

$

270,518.12 $

0.00

$

327,038.48 $ ===10=0,!,;;,6;,;.7,;,;1.=31~

EXHIBIT"E"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

JUNE 30, 2001

JUNE 30, 2000

$

0.00 $

149,307.98 $

258,438.22

214,000.00

249.000.00

$

263,648.60

277,486.22

457,628.17

28,801.71 21 ,762.48

25,480.31 15,558.19

$

263,648.60 $

0.00 $

691,358.39 $ 1,006,104.89

$

34,785.71

20,120.74

92,183.90

95,036.26

21 ,521.99

$

263,648.60

$

34,785.71 $

206,513.31

43,065.61

55,449.66

218,430.70

248,504.81

95,036.26

33,348.87

29,521.99

$

420,840.27 $

543,816.65

$

0.00 $

$

0.00 $

$

263,648.60 $

$

47,758.31

$
0.00 0.00 $

28,801.71 21,762.48
219,953.93
270,518.12 $

25,480.31 15,558.19
373,491.43
462,288.24

0.00 $

691.358.39 $ 1,006,104.89

- 19-

APPLING COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 2001

FUND BALANCE JUNE 30
See notes to the general-purpose financial statements. - 20-

$

270,518.12 $====O~.~OO~

EXHIBIT"F"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$ $ 2,445,225.07
$ 2,445,225.07 $

15,864.00 $ 15,864.00 $

829,871.06 $ 3,286,833.01
310,493.45
4,427,197.52 $

878,116.79 2,609,921.60
328,110.33
3,816,148.72

$ 1,391,953.09 $
43,388.06 143,310.27
141,785.50 8,126.00 14,973.31
647,955.46 2,500.00
137,954.22 20,712.77
$ 2,552,658.68 $
$ -107,433.61 $

10,249.82 $ 5,614.18
15,864.00 $ 0.00 $

1,980,176.87 $
137,006.64 166,619.84
144,518.87 8,214.81
32,782.08 650,294.44 1,408,394.89 137,954.22
22,205.97
4,688,168.63 $
-260,971.11 $

1,654,393.36
184,067.30 225,156.63
4,888.16 63,764.69
20,379.38 380,275.76 1,347,624.10
18,338.56
3,898,887.94
-82,739.22

59,675.30

$

-47,758.31 $

47,758.31

59,675.30

0.00 $ 0.00

-201,295.81 $ 462,288.24

-82,739.22 560,510.97

3,321.40 6,204.29

-12,941.72 -2,541.79

$

0.00 $

0.00 $

270,518.12 $==4=6=25,2=88=.:::24=

- 21 -

APPLING COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30, 2001

EXHIBIT "G"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable

REGULAR

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS JUNE 30, 2001 JUNE 30, 2000

$ 369,584.19 $

26,787.91 $ 396,372.10 $ 358,226.24

258,271.55

1,787,856.94

2,046,128.49

334,863.41

349,850.56

349,850.56

Total Assets

$ 627,855.74 $ 2,164,495.41 $ 2,792,351.15 $==6=9=3=,0=89=.=65=

LIABILITIES AND FUND EQUITY
LIABILITIES
Retainages Payable
FUND EQUITY
Fund Balances Reserved For SPLOST Projects Unreserved Undesignated
Total Fund Equity

$ 1,000.00

$

1,000.00 $

$ 2,164,495.41 $ 2,164,495.41

$ 626,855.74

0.00

626,855.74 $

$ 626,855.74 $ 2,164,495.41 $ 2,791,351.15 $

29,641.35
663,448.30 663,448.30

Total Liabilities and Fund Equity

$ 627,855.74 $ 2,164,495.41 $ 2,792,351.15 $==6=9=3=,0=89=.=65=

See notes to the general-purpose financial statements.

- 22-

APPLING COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30, 2001

EXHIBIT "H"

REGULAR

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS YEAR ENDED JUNE 30, 2001 JUNE 30, 2000

REVENUES

Taxes Other Funds

$ 2,134,339.01 $ 2,134,339.01

$ 25,330.58

33.478.46

58,809.04 $

43,282.73

Total Revenues

$ 25,330.58 $ 2,167,817.47 $ 2,193,148.05 $

43,282.73

EXPENDITURES

Capital Outlay Salaries Employee Benefits Building and Building Improvements

$ 238.426.62 $

76,172.06 $

$ 314,598.68

708.00 10.49
764,858.93

Total Expenditures

$ 238.426.62 $

76,172.06 $ 314,598.68 $ 765,577.42

Excess of Revenues over (under) Expenditures

$ -213,096.04 $ 2,091,645.41 $ 1,878,549.37 $ -722,294.69

OTHER FINANCING SOURCES

Operating Transfers In

176,503.48

72,850.00

249,353.48

385,277.71

Excess of Revenues and Other Financing Sources over (under) Expenditures

$ -36,592.56 $

2,164,495.41 $ 2,127,902.85 $. -337,016.98

FUND BALANCE JULY 1

663.448.30

0.00

663.448.30

1,000,465.28

FUND BALANCE JUNE 30

$ 626,855.74 $ 2,164.495.41 $ 2,791,351.15 $ 663.448.30

See notes to the general-purpose financial statements.

- 23-

APPLING COUNTY BOARD OF EDUCATION STATEMENT OfCHANGE:sTNASSETS AN'D LIABILiTIES
FIDUCIARYF0NDTYPE -AGENCY FUND YEARENDED JUNE 30, 2001

EXHIBIT "I"

FAMILY CONNECTION ASSETS
Cash and Cash Equivalents Accounts Receivable
LIABILITIES Funds Held for Others

BALANCE JULY 1, 2000

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 2001

$

0.00 $ 71,719.02 $ 101,672.29 $ -29,953.27

0.00

29,95327

0.00

29,953.27

$===0=,0=0,= $ 101,672.29 $ 101,672.29 $====O~.~OO~

$====0=,0=0,= $ 101,672.29 $ 101,67229 $====O~.~OO~

See notes to the general-purpose financial statements. - 24-

APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2001

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program National School Lunch Program

10.553 10.555

N/A

$ 168,702.77

(2)

N/A

595,450.83 $

1,328,440.55 (3)

Total Child Nutrition Cluster

$ 764,153.60 $

1,328,440.55

Other Programs

Pass-Through From Georgia Department of Education

Food and Nutrition Program

Food Distribution Program (1)

10.550

N/A

Pass-Through From Office of School Readiness

Food and Nutrition Program

Child and Adult Care Food Program

10.558

N/A

70,369.58 7,084.76

70,369.58 7,084.76

Total U. S. Department of Agriculture

$ 841,607.94 $

1,405,894.89

Education, U: S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Individuals with Disabilities Education Act Part B - Special Education Capacity Building Improvement Grant Flow Through Preschool

84.027 84.027 84.173

N/A

$

4,046.50 $

N/A

247,335.87

N/A

38,889.00

6,646.50 (3) 247,335.87
43,145.16 (3)

Total Special Education Cluster

$ 290,271.37 $

297,127.53

Other Programs. Direct Safe and Drug-Free Schools and Communities National Program Pass-Through From Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Title II Eisenhower Professional Development Title III Technology literacy Challenge Fund Grants Title VI Innovative Education Program Strategies Class Size Reduction Goals 2000 State and Local Education Systemic Improvement Grants Vocational Education - Basic Grants to States High School Program Basic Grant
Pass-Through From First District Regional Educational Service Agency d/b/a live Oak Migrant Education Agency Elementary and Secondary Education Act Title I Migrant Education

. 84.184
84.010 84.281 84.318 84.298 84.340 84.276 84.048
84.011

1,050,846.12

1,050,846.12

N/A

639,778.37

639,778.37

N/A

7,493.74

20,063.72 (3)

N/A

17,870.06 (3)

N/A

26,434.00

26,434.00

N/A

80,655.80

80,655.80

N/A

140,733.27

158,617.32

N/A

58,432.94

63,539.80 (3)

N/A

121,785.08

121,785.08

Total U. S. Department of Education

$ 2,416,430.69 $ 2,476,717.80

- 25-

APPLING COUNTY BOARD OF EDUCATION
SCHEDULE OF EXPENDrrORES OF FEDERAL AWARDS
YEARENDED JUt'lE3'0,2001

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Defense, U. S. Department of Direct Department of the Air Force R. 0, T, C. Program

CFDA NUMBER

PASS THROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

$ 28,794.38 $

75,940.88 (3)

Total Federal Financial Assistance
= N/A Not Available

$ 3,286.833.01 $=~3,~9;;;;58;;;,;.5;;;:5~3;,;;;.5,;,.7

Notes to the Schedule of Expenditures of Federal Awards
(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2001 National School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures are notmaintained by fund source.
n Major Programs are identified by an asterisk in front of the CFDA number.
The School District did not provide Federal Assistance to any SUbrecipient.
The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Appling County Board of Education and is presented on the modified accrual basis of accounting which is the basis of accounting used in'the presentation of the general-purpose financial statements.

See notes to the general-purpose financial statements.

- 26-

APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2001

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Category I Category II Category III Category IV Category V Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program Staff and Professional Development Indirect Cost Categorical Grants Pupil Transportation Regular Bus Replacement Nursing Services Principal Supplements Vocational Supervisors Migrant Education Mid-term Adjustment Hold-Harmless Food Services Vocational Education Other State Programs At-Risk Summer School Program Health Insurance Innovative Programs Mentor Teachers Preschool Handicapped Program Remedial Summer School Special Education Low Incidence Grant Teachers'Retirement Lottery Programs Computers in the Classroom
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACT Education, Georgia Department of Reading First Program

1

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$

541,486.00

159,058.00

1,647,763.00

309,384.00

851,508.00

1,544,114.00

1,321,333.00

561,828.00

11,061.00 439,689.00 900,102.00 199,613.00
27,294.00 14,494.00 224,230.00 123,393.00 65,701.00 268,333.00 70,903.00 1,767,221.00

$

541,486.00

159,058.00

1,647,763.00

309,384.00

851,508.00

1,544,114.00

1,321,333.00

561,828.00

11,061.00 439,689.00 900,102.00 199,613.00
27,294.00 14,494.00 224,230.00 123,393.00 65,701.00 268,333.00 70,903.00 1,767,221.00

617,549.00 181,931.00
77,716.00 13,357.00 23,442.00
4,103.00 118,600.00
$ 100,256.00 116,769.00
4,358.56 248,602.58
4,988.38 815.00
52,621.00 5,809.52
14,816.00 41,560.67
67,675.00

617,549.00 181,931.00
77,716.00 13,357.00 23,442.00
4,103.00 118,600.00 100,256.00 116,769.00
4,358.56 248,602.58
4,988.38 815.00
52,621.00 5,809.52
14,816.00 41,560.67
67,675.00

646,076.06

646,076.06

39,147.00

39,147.00

15,864.00

15,864.00

See notes to the general-purpose financial statements.

$ 12,614,693.71 $ 829,871.06 $ 13,444,564.77 - 27

APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30. 2001

SCHEDULE "3"

PROJECT
Acquiring. constructing and equipping a new high school, including parking areas and grounds; Construction of additional classrooms, as well as remodeling, renovating and improving such spaces, all at existing school district facilities; purchase of any necessary real property; acquiring furnishings, equipment and fixtures, and paying expenses incident thereto

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED
IN PRIOR YEARS (3)

PROJECT STATUS

$ 10,000,000.00 $ 10,000,000.00 $

76:172.06 $ 71,218.00 Ongoing

(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax.
(2) The School District's current estimate of total cost for the project. Indudes all cost from project inception to completion.
(3) The voters of Appling County approved the imposition of a 1% sales tax to fund the above project. Amounts expended for this project may indude sales tax proceeds, state, local property taxes and/or other funds over the life of the project.

See notes to the general-purpose financial statements.

- 29

APPLING COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBEI
ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2001

SCHEDULE "4"

DESCRIPTION

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

Direcllnstruclional Programs

Kindergarten Program

$

Kindergarten Program-Early Intervention Program

Primary Grades (1-3) Program

Primary Grades-Early Intervention (1-3) Program

Upper Elementary Grades (4-5) Program

Middle School (6-8) Program

High School General Education (9-12) Program

Vocational Laboratory (9-12) Program

Students with Disabilities

Category I

Category II

Category III

Category IV

Category V

Gifted Student - Category VI

Remedial Education Program

Alternative Education Program

English Speakers of Other Languages (ESOL)

683,909.00 $ 200,894.00 2.081,163.00 390,760.00 1,075.474.00 1,950,251.00 1,668.874.00 709,602.00 1,992,744.00
18,307.00 283.208,00 155.848.00
82,982.00

689.403.15 $ 166,936.07 2,178,452.52 129.868.96 1,316,133.67 2,174,503.81 1,845,690.21 741,220.55
9,970.87 544.501.31 1,142,398.52 219.830.86
3.417.02 80,134.58 245,715.64 137,760.65 70,028,25

30,907.52 $
84,975.08 72.13
41,499.28 96.510.44 117,020.29 136,213.15
271.34 13,763.37 21.783.82 6,001,80
546,98 3,693.32 2.929.12 4,593.32
818.53

720,310.67 166,936.07 2,263,427.60 129,941.09 1,357,632.95 2,271,014.25 1,962,710.50 877,433.70
10,242.21 558.264.68 1,164,182.34 225.832.66
3,964.00 83,827.90 248,644.76 142.353.97 70,846.78

TOTAL DIRECT INSTRUCTIONAL PROGRAMS

$

11.294,016.00 $ 11.695.966.64 $ 561.599.49 $ 12,257,566.13

Media Center Program Staff and Professional Development

338,910.00 89,552.00

532.683.16 40,823.79

132.192.10 48,728.21

664,875.26 89,552.00

TOTAL QBE FORMULA FUNDS

$

11,722.478.00 $ 12,269.473.59 $ 742,519.80 $ 13.011,993,39

(1) Comprised of State Funds plus Local Five Mill Share.

See notes to the general-purpose financial statements.

- 30

APPLING COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE)
ALLOTMENTS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 30, 2001

SCHEDULE "5"

Appling County Elementary School Appling County Middle School Appling County Primary School Altamaha Elementary School Appling County High School Fourth District Elementary School Cedarwood Psychoeducational Program Appling County Learning Center Alternative Education Center Central Office (Alternative Education Program) Other Auxiliary Facility
TOTAL
(1) Comprised of State Funds plus Local Five Mill Share.

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE aBE PROGRAM COSTS

$

1,948,823.00 $

2,017,462.25

2,561,681.00

2,763,582.21

2,084,422.00

2,317,282.39

893,994.00

895,627.44

3,041,438.00

3,480,580.01

607,810.00

644,912.70

14,312.70

10,325.65

113,437.72

155,848.00

43.06

$

11,294,016.00 $ 12,257,566.13

See notes to the general-purpose financial statements. - 31 -

SECTIONll COMPLIANCE AND INTERNAL CONTROL REPORTS

RUSSELL \\'. H,r-.TON
STATE AUDITOR 1404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street. Sw.. Suite 214 Atlanta. Georgia 30334-X400
March 13,2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Appling County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements of Appling County Board of Education as of and for the year ended June 30,2001, and have issued our report thereon dated March 13,2002. 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 auditing. standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Compliance'
As part of obtaining reasonable assurance about whether Appling County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit, and accordingly, we do not express such an opinion. The results ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Appling County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal
2001YB-41

control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in our judgment, could adversely affect Appling County Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-6011-01-01.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the 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 over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, we consider item FS-60 11-01-01 to be a material weakness.
This report is intended solely for the information and use of the management, members of the Appling County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
?h.JQ '~ell W. Hinton ~~ State Auditor
RWH:gp 2001YB-41

RIISSEJ.J. \\:. HI1IiTON
STATE AUDITOR (404) 656217"

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washingtqn Street. S.w.. Suite 214 Atlanta, Georgia 30334-X400
March 13,2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Appling County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-l33
Ladies and Gentlemen:
Compliance
We have audited the compliance of Appling County Board of Education with the types of
u.s. compliance requirements described in the Office oJManagement and Budget (OMB) Circular
A-i33 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended June 30, 2001. Appling County Board ofEducation's major Federal programs are identified in the Summary of Auditor's Results Section of the accompanying Schedule of Findings _and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Appling County Board of Education's management. Our responsibility is to express an opinion on Appling County Board of Education's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A133, Audits oj States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-I33 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types ofcompliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Appling County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Appling County Board of Education's compliance with those requirements.
200ISA-40

In our opinion, the Appling County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30, 2001.
Internal Control Over Compliance
The management of Appling County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Appling County Board ofEducation's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our . auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133.
We noted certain matters involving the internal control over compliance and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over compliance that, in our judgment, could adversely affect the Appling County Board of Education's ability to administer a major Federal program in accordance with applicable requirements oflaws, regulations, contracts and grants. Reportable conditions are described in the accompanying Schedule ofFindings and Questioned Costs as items FA-6011-01-01, FA-6011-01-02, FA-6011-01-03, FA-6011-01-04 and FA-6011-01-05.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level of risk that noncompliance with the applicable requirements oflaws, regulations, contracts and grants that would be material in relation to a major Federal program 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 over compliance would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, we do not consider any of the items described above to be material weaknesses.
This report is intended solely for the information and use of the management, members of the Appling County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfi.llly submitted,
~ QQ.W~ ~el.l.W. . Hinton State Auditor
RWH:gp 2001SA-40

SECTIONlli AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

APPLING COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2001

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-60 11-98-02 FS-60 11-99-0 1 FS-60 11-00-0 1

Previously Reported Corrective Action Implemented Further Action Not Warranted Unresolved - See Corrective Action/Responses

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Finding Control Number: FS-6011-00-01

The Appling County Board of Education has not established a General Fixed Assets Account Group. We are working on plans to establish one in the near future.

PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FA-6011-99-0l FA-6011-00-01

Previously Reported Corrective Action Implemented Previously Reported Corrective Action Implemented

SECTION IV FINDINGS AND QUESTIONED COSTS

APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001

I SUMMARY OF AUDITOR'S RESULTS

1. Type of Report Issued on the Financial Statements The auditor's opinion on the Appling County Board ofEducation's financial statements was qualified for various departures from generally accepted accounting principles.

2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Appling County Board of Education disclosed a financial statement reportable condition related to the following control category.

General Fixed Assets

The reportable condition described above is considered to be a material weakness.

3. Noncompliance Material to the Financial Statements The audit of the Appling County Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements.

4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Appling County Board ofEducation disclosed reportable conditions in internal control over major programs for the following compliance requirements.

Activities Allowed or Unallowed Equipment and Real Property
Management

Allowable Costs/Cost Principles Reporting

None ofthe reportable conditions described above are considered to be a material weakness.

5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Appling County Board of Education's report on compliance with requirements applicable to major programs was unqualified.

6. Audit Findings Required to be Reported by Section .51 O(a) of OMB Circular A-133 The Appling County Board of Education's audit disclosed audit findings required to be reported by section .51 O(a) of OMB Circular A-133. These audit findings are included in section IV of this report.

7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program 84.184 Safe and Drug-Free Schools and Communities - National Program

- 1-

APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001
SUMMARY OF AUDITOR'S RESULTS
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,00.00.
9. Low Risk Auditee The Appling County Board of Education qualified as a low risk auditee based on a waiver granted by the U. S. Department of Education.
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-6011-01-01
The Appling County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general-purpose financial statements of the School District being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the School District 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 School District 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.
III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
ACTIVITIES ALLOWED OR UNALLOWED Inadequate Purchasing Procedures Reportable Condition U. S. Department of Educati.on Finding Control Number: FA-6011-0l-0l
An examination of expenditure vouchers charged to the Safe and Drug-Free Schools and Communities - National Program (CFDA 84.184) was performed to test for the validity and accuracy of the expenditures. The vouchers examined revealed the following deficiencies:
(1) Purchases were not approved prior to placing an order for goods or services.
(2) Purchase orders were not systematically included as part ofthe documentation supporting expenditures:
-2-

APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001
III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
ACTIVITIES ALLOWED OR UNALLOWED Inadequate Purchasing Procedures Reportable Condition U. S. Department of Education Finding Control Number: FA-6011-01-0l
These conditions were a result ofmanagement's failure to implement internal controls for monitoring compliance with Federal guidelines. The management of the School District should fonnulate and implement adequate procurement procedures to ensure that purchases are specifically approved prior to ordering goods and services.
ALLOWABLE COSTS/COST PRINCIPLES Unapproved Salary Increase Reportable Condition U. S. Department of Education Finding Control Number: FA-6011-01-02
A review of expenditures for personal services charged to the Safe and Drug-Free Schools and Communities - National Program (CFDA 84.184), revealed the Program Director gave an employee a $10,000.00 per annum salary increase raise in June 2001 without proper approval of the School District. There was also no documentation included in the employee's personnel file for this raise. Any type of salary adjustment must be documented and have approval before being implemented. These conditions were a result ofmanagement's failure to implement internal controls for monitoring compliance with Federal guidelines. The School District should implement procedures to ensure that salary adjustments are approved prior to implementation.
EQUIPMENT AND REAL PROPERTY MANAGEMENT Inadequate Inventory Records Reportable Condition Nonmaterial Noncompliance U. S. Department of Education Finding Control Number: FA-6011-01-03
Property management records maintained by the Appling County Board of Education for the Safe and Drug-Free Schools and Communities - National Program (CFDA 84.184) were incomplete and failed to meet property management standards as set forth in Chapter 41, of the Financial Management for Georgia Local Units of Administration (FMGLUA).
The inventory records as presented for audit did not contain a complete description of the asset, serial number or other identification number, title holder, acquisition date, source of funding and condition. The inventory records also contained items other than equipment as well as duplicate
-3-

APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001
III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
EQUIPMENT AND REAL PROPERTY MANAGEMENT Inadequate Inventory Records Reportable Condition Nonmaterial Noncompliance U. S. Department of Education Finding Control Number: FA-6011-01-03
iterns, which resulted in the inventory records being misstated as presented. This condition occurred because management failed to maintain equipment inventory records as set forth in FMGLUA.
The School District should implement procedures to ensure that the equipment inventory records include all descriptive items as required by Chapter 41 ofFMGLUA. The inventory records should also be reviewed for accuracy to ensure that only valid equipment items are included.
EQUIPMENT AND REAL PROPERTY MANAGEMENT Inadequate Inventory Records Reportable Condition Nonmaterial Noncompliance U. S. Department of Agriculture Pass-Through From Georgia Department of Education Finding Control Number: FA-6011-01-04
Property management records maintained by the Appling County Board of Education for the Child Nutrition Cluster (CFDA 10.553 and 10.555) were incomplete and failed to meet property management standards as set forth in Chapter 41, of the Financial Management for Georgia Local Units of Administration (FMGLUA).
The inventory records as presented for audit did not include a description of the equipment, serial number or other identification number, source of funding, percentage of Federal participation and condition. In addition, equipment inventory records were not updated for all current year additions. This condition occurred because management failed to maintain equipment inventory records as set forth in FMGLUA.
The School District should implement procedures to ensure that the equipment inventory records include all descriptive items as required by Chapter 41 ofFMGLUA. The inventory records should also be reviewed for accuracy to ensure that only valid equipment items are included.
-4-

APPLING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30... 2001
III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS REPORTING Federal Financial Reports Not Supported by Accounting Records Reportable Condition U. S. Department of Education Finding Control Number: FA-60ll-0l-05 A comparison between the School District's reports to the U. S. Department of Education for the Safe and Drug-Free Schools and Communities - National Program (CFDA 84.184) and the School District's financial records revealed that the expenditures reported on the ED Form 524 were not adequately supported. This condition was a result of management's failure to implement adequate internal controls for monitoring compliance with Federal guidelines. The School District should implement procedures to ensure that all Federal financial reports are accurate and verifiable to the accounting records.
-5-