Baker County Board of Education, Newton, Georgia, annual financial report for the fiscal year ended 2020 June 30 (including independent auditor's reports)

BAKER COUNTY BOARD OF EDUCATION
NEWTON, GEORGIA
ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2020
(Including Independent Auditor's Reports)

BAKER COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S REPORT

REQUIRED SUPPLEMENTARY INFORMATION

MANAGEMENT'S DISCUSSION AND ANALYSIS

EXHIBITS

BASIC FINANCIAL STATEMENTS

GOVERNMENT-WIDE FINANCIAL STATEMENTS

A

STATEMENT OF NET POSITION

B

STATEMENT OF ACTIVITIES

FUND FINANCIAL STATEMENTS

C

BALANCE SHEET

GOVERNMENTAL FUNDS

D

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET

TO THE STATEMENT OF NET POSITION

E

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES

IN FUND BALANCES

GOVERNMENTAL FUNDS

F

RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT

OF REVENUES, EXPENDITURES AND CHANGES IN FUND

BALANCES TO THE STATEMENT OF ACTIVITIES

G

STATEMENT OF FIDUCIARY NET POSITION

FIDUCIARY FUNDS

H NOTES TO THE BASIC FINANCIAL STATEMENTS

SCHEDULES

REQUIRED SUPPLEMENTARY INFORMATION

1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA
2 SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA 3 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY
PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA 4 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY
SCHOOL OPEB FUND 5 SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND 6 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION 7 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND

Page
i
1 2
3 4 5 6 7 8
29 30 31 32 33 34 35

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BAKER COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
SECTION I FINANCIAL SCHEDULES SUPPLEMENTARY INFORMATION 8 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 9 SCHEDULE OF STATE REVENUE 10 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
SECTION II COMPLIANCE AND INTERNAL CONTROL REPORT INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
SECTION III 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

Page
36 37 39

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SECTION I FINANCIAL

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Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 4-101 Atlanta, Georgia 30334-8400

INDEPENDENT AUDITOR'S REPORT

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Superintendent and Members of the Baker County Board of Education
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Baker County Board of Education (School District), as of and for the year ended June 30, 2020, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these 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 of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the School District as of June 30, 2020, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements.
The accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

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Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated August 23, 2021 on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance.
A copy of this report has been filed as a permanent record and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24.
Respectfully submitted,

August 23, 2021

Greg S. Griffin State Auditor

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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020
INTRODUCTION
The discussion and analysis of the Baker County Board of Education's (the School District) financial performance provides an overall review of the School District's financial activities for the fiscal year ended June 30, 2020. Comparative data is provided for fiscal year 2020 and fiscal year 2019. The intent of this discussion and analysis is to look at the School District's financial performance as a whole; readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance.
FINANCIAL HIGHLIGHTS
Key financial highlights for fiscal year 2020 are as follows:
The total assets and deferred outflows of the School District increased by $2.4 million, which was primarily noted as an increase in deferred outflows related to OPEB and pension funds.
Total liabilities and deferred inflows of resources increased for the year by $1.8 million, primarily due to an increase in liabilities associated with OPEB and pension funds.
The combination of the increase in total assets and deferred outflows of resources of $2.4 million and the increase in total liabilities and deferred inflows of resources of $1.8 million yields an increase in net position of $0.6 million.
At June 30, 2020, the School District's general fund reported a balance of $3.2 million, an increase of $0.6 million from the last fiscal year. Of this total, $3.1 million represents unassigned fund balance.
OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis is intended to serve as an introduction to the School District's basic financial statements. The basic financial statements are comprised of three components: 1) Government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves.
Government-Wide Financial Statements
The government-wide financial statements are designed to provide readers with a broad overview of the School District's finances in a manner similar to a private-sector business. The Statement of Net Position presents information on all the School District's assets, deferred inflows/outflows, and liabilities with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the School District is improving or deteriorating. It is important to note that this statement consolidates the School District's current financial resources (short-term) with capital assets and long-term liabilities.
The Statement of Activities presents information showing how the School District's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will result in cash flows in future fiscal periods (e.g. uncollected taxes, etc.).
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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been separated for specific activities or objectives. The School District, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the School District can be divided into two categories: governmental funds and fiduciary funds.
Governmental Funds - Most of the School District's activities are reported in governmental funds focusing on how money flows in and out of those funds and the balances left at year-end available for spending in future periods. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps you determine whether there are more or less financial resources that can be spent in the near future to finance educational programs.
Fiduciary Funds - The School District is the trustee, or fiduciary, for assets that belong to others such as school clubs and class funds. The School District is responsible for ensuring assets reported in these funds are used only for their intended purposes and by those to whom assets belong.
Notes to Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net position may serve over time as a useful indicator of a government's financial position. As of June 30, 2020, School District assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $4.2 million, primarily due to cash on hand and the net investment in capital assets.
Net position of $7.6 million represents the School District's investments in capital assets (e.g. buildings, land, land improvements, equipment) less any related debt used to acquire those assets that remain outstanding. The School District uses the capital assets to provide services to our students, faculty, and community; consequently, these assets are not available for future spending.
Unrestricted net position may be used to meet ongoing obligations and operations of the School District.
An additional portion of the School District's total net position represents resources that are subject to external restrictions on how they may be used. Comprising the majority of restricted net position is net position for capital outlay projects, representing 98.4% of total restricted net position. The remaining 1.6% represents funds restricted for ongoing federal programs.
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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020

The following table details the major categories of assets, deferred outflows of resources, liabilities, deferred inflows of resources, and net position with a comparison to the prior fiscal year.

Table 1 Net Position

Governmental Activities

Fiscal Year

Fiscal Year

2020

2019

Assets Current and Other Assets Capital Assets, Net

$ 4,152,996.95 $ 3,497,262.97

7,706,790.02

7,549,634.69

Total Assets

11,859,786.97 11,046,897.66

Deferred Outflows of Resources

2,890,183.00

1,223,564.00

Liabilities Current and Other Liabilities Long-Term Liabilities

541,524.55 8,087,805.24

660,069.78 6,256,814.11

Total Liabilities

8,629,329.79

6,916,883.89

Deferred Inflows of Resources

1,969,296.00

1,843,539.00

Net Position Net Investment in Capital Assets Restricted Unrestricted (Deficit)

7,624,210.28 474,668.45
(3,947,534.55)

7,525,638.79 254,909.11
(4,270,509.13)

Total Net Position

$ 4,151,344.18 $ 3,510,038.77

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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020

CHANGES IN NET POSITION FROM OPERATING RESULTS

Net position increased $0.6 million from operating results in the fiscal year ended June 30, 2020 compared to an increase of $0.3 million in the prior fiscal year. Key elements of this increase are as follows on the next table:

Table 2 Change in Net Position

Revenues

Program Revenues

Charges for Services

$

Operating Grants and Contributions

Capital Grants and Contributions

Governental Activities

Fiscal Year

Fiscal Year

2020

2019

31,764.88 $ 3,123,058.28
439,799.46

31,684.42 2,774,708.04
32,394.54

Total Program Revenues
General Revenues Taxes Property Taxes For Maintenance and Operations Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects Other Sales Taxes Investment Earnings Miscellaneous
Extraordinary Item

3,594,622.62

2,838,787.00

2,402,775.66
271,350.97 20,338.52 1,369.47
137,530.38 -

2,358,201.12
214,291.66 5,811.94
15,425.74 133,372.96
(441.19)

Total General Revenues and Extraordinary Item

2,833,365.00

2,726,662.23

Total Revenues
Program Expenses 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 Operations of Non-Instructional Services Enterprise Operation Food Services Interest on Long-Term Debt

6,427,987.62
3,095,529.84
245,596.51 357,924.32
39,948.53 303,617.51 266,944.27 277,632.01 486,164.94 392,447.64
15,327.92 2,051.00
64,278.70 236,092.55
3,126.47

5,565,449.23
2,793,970.33
287,615.02 241,183.07 147,915.95 218,920.97 178,802.55 283,516.97 453,026.82 408,919.97
797.50 40.47
46,301.15 243,719.61
1,736.54

Total Expenses

5,786,682.21

5,306,466.92

Increase in Net Position

$

641,305.41 $

258,982.31

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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020
FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT'S FUNDS
General Fund Budgetary Highlights
The School District's budget is prepared in accordance with Georgia law and is based on accounting for certain transactions on the modified accrual basis of accounting. The School District uses sitebased budgeting and the budgeting system is designed to tightly control site budgets but provide flexibility for site management.
The most significant budgeted fund is the general fund. As originally adopted, general fund revenues were projected to be $4.9 million with appropriated expenditures totaling $5.2 million, down 3.7% from the fiscal year 2019 final amended budget.
As fiscal year 2020 progressed, the final amended general fund budget increased $0.8 million for revenues, an increase of 15.3% from the original budget for the year. The reason for the amendment was to adjust federal grants from estimates to actual awarded amounts.
The original budget for fiscal year 2020 included appropriated expenditures of $5.2 million, which was $0.2 million less than the 2019 final budget appropriated expenditures of $5.4 million.
General Fund Operations
The general fund finished fiscal year 2020 with a fund balance of $3.2 million, an increase of $0.6 million or 23.4%, from fiscal year 2019. Actual revenues were above budget projections by $0.1 million while actual expenditures were $0.7 million less than budgeted. Several important factors led to the actual results for the year.
Local revenue sources represented 44.7% of total general fund revenues for the year, down from 46.8% in the prior year. Local revenues ended the year above budgeted projections because property tax collections were more than projected ($0.5 million). The remainder of local revenues consisted of other taxes, interest, charges for services, and miscellaneous items.
Total expenditures were under budget by $0.7 million. The significant changes occurred in the functions of instruction and maintenance and operations.
Expenditures for direct classroom instruction (e.g. teacher salaries and benefits, textbooks, software, classroom supplies, etc.) accounted for 50.7% of total general fund expenditures, down slightly from the prior fiscal year. Employee benefits saw increases in fiscal year 2020. The employer share for Teachers Retirement contribution increased from 20.90% in fiscal year 2019 to 21.14% in fiscal year 2020.
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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020
The following table details the major components of revenues and expenditures by function for fiscal year 2020 as well as a comparison of changes compared to the previous fiscal year.
Table 3 General Fund Revenue and Expenditure Comparison

Reven u es State Federal Local

Amount
$ 2,564,738.82 632,375.46
2,584,629.80

Total

Increase (Decrease) over
Fiscal Year 2019

44.36% $ 10.94% 44.70%

406,374.56 (94,788.11) 42,632.83

Total Revenues

5,781,744.08

100.00%

354,219.28

E xpen di t u res 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 Enterprise Operations Food Services Debt Service

2,622,654.99
229,141.88 340,983.84
30,530.70 288,784.76 229,186.64 260,850.03 458,557.93 383,961.92
15,327.92 2,051.00
64,278.70 232,060.34
19,966.89

50.64%
4.42% 6.58% 0.59% 5.58% 4.43% 5.04% 8.86% 7.41% 0.30% 0.04% 1.24% 4.48% 0.39%

(219,670.32) -
(68,740.80) 99,413.26 (127,333.75) 54,256.92 39,714.25 (41,322.95) (16,871.59) 51,366.56 14,530.42
2,034.21 17,977.55 (15,061.09) 11,514.08

Total Expenditures
Capital Projects Fund Operations

$ 5,178,337.54

100.00% $

(198,193.25)

The capital projects fund is used to account for school construction and the purchase of large capital assets. Expenditures in 2020 were comparable to capital outlay projects in the previous year. Significant improvements included HVAC upgrades and the purchase of a bus.

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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020

CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
The School District's investment in capital assets for its governmental activities as of June 30, 2020 totaled $7.7 million, net of accumulated depreciation. The investment in capital assets includes land, land improvements, buildings, vehicles, and equipment used in providing services to our students and community. The changes to School District's capital asset accounts came from capital asset additions and current year depreciation expense. Note 5 to the basic financial statements provides additional information on the School District's capital assets including a detailed breakdown of the types of capital assets included in the computation of depreciation charges. As of June 30, 2020, 38.0% of the cost basis of depreciable assets had been taken as a depreciation charge since the various assets were placed in service.
A summary of capital assets follows:

Table 4 Capital Assets (Net of Depreciation)

Governmental Activities

Fiscal

Fiscal

Year 2020

Year 2019

Land Construction in Progress Building and Improvements Equipment Land Improvements

$

82,372.24 $

17,228.20

5,999,922.67

537,349.26

1,069,917.65

82,372.24 32,462.33 5,827,423.07 509,669.33 1,097,707.72

Total

$ 7,706,790.02 $

7,549,634.69

Debt Administration
At June 30, 2020, the School District had $0.03 million in outstanding capital lease indebtedness. Additional information on the School District's long-term debt can be found in Note 7 to the basic financial statements.
Table 5 Debt at June 30

Governmental Activities

Fiscal Year

Fiscal Year

2020

2019

Capital Leases

$ 29,335.24 $ 23,928.11

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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020
Current Issues
The School District is a low income, rural county School District. The majority of students are economically disadvantaged. The student population is 52% African-American, 26% Caucasian, 15% Hispanic and 7% other. The School District is located in an area where agriculture is the primary industry. Despite limited financial resources, School District personnel manage to maximize the funds in order to benefit all students. The School District has planned extensively to use its supplemental resources to support class size reduction, recruitment, retention and professional development of highly qualified staff. The School District, while small, offers students a variety of instructional programs and extra-curricular opportunities.
The School District has faced severe financial challenges in recent years but has remained relatively stable and financially sound. The financial challenges have included rising costs in employee benefits, the continued state formula allotment reductions, and a slow decline in student enrollment (FTE).
The School District's current millage rate for the 2019 tax year is 14.065 for maintenance and operations, down slightly from 2018 tax year.
In December 2019, a strain of coronavirus (COVID-19) began to spread worldwide, resulting in a severe impact to the United States economy in March 2020. The spread of COVID-19 has had a negative impact on virtually all businesses and individuals which comprise the tax base of all levels of government.
Outlook for the Future
The School District enjoys a strong financial position in light of current economic conditions affecting local revenues as well as the effect of state revenue pressures through austerity reductions to the QBE funding formula and new programmatic requirements. While state revenues improved during fiscal year 2020, expectations are that austerity reductions will continue in fiscal year 2021 and beyond at some undetermined level. However, the State's reduction of austerity in 2017 is a positive sign of revenue collections at the state level. Until all funds are restored, the continued relaxation of class size requirements and other waivers by the Georgia Department of Education are providing the flexibility the School District needs to offset the shortfall of state funding and the decrease in SPLOST reductions in collections due to Title Ad Valorem Tax collections. The expectations of decreases due to drop in enrollment continue.
At this time, the objective is to maintain a strong financial condition to better address any further cutbacks in State funding that could have an adverse effect on operations and financial reserves. The School District continues to fluctuate in growth, but not at the rate experienced in past years. School District FTE for the upcoming fiscal year (2021) is 286. In 2020, the count was 268 as compared to 281 in 2019. Therefore, we strive for student enrollment to slightly increase in the foreseeable future with positive programs being added to meet the area workforce and needs of the student and community.
The School District recognizes its responsibility to the taxpayers in overseeing the spending of federal, state and local funds. The School District is striving to maintain sound fiscal management while emphasizing student achievement. The School District is committed to creating, building, and sustaining a culturally and economically sensitive environment that provides equal access to a high standard of educational success for all students.
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BAKER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 Requests for Information This financial report is designed to provide our citizens, taxpayers, investors, and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. Questions concerning any of the information provided in this report or requests for additional information should be addressed to: Dr. Roy Brooks, Superintendent, or Lauren Tabb, Finance Director Baker County Board of Education P. O. Box 40 260 Highway 37 Newton, GA 39870
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BAKER COUNTY BOARD OF EDUCATION

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BAKER COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2020
ASSETS
Cash and Cash Equivalents Receivables, Net
Taxes State Government Federal Government Other Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation)
Total Assets
DEFERRED OUTFLOWS OF RESOURCES
Related to Defined Benefit Pension Plan Related to OPEB Plan
Total Deferred Outflows of Resources
LIABILITIES
Accounts Payable Salaries and Benefits Payable Interest Payable Retainages Payable Net Pension Liability Net OPEB Liability Long-Term Liabilities
Due Within One Year Due in More Than One Year
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Related to Defined Benefit Pension Plan Related to OPEB Plan
Total Deferred Inflows of Resources
NET POSITION
Net Investment in Capital Assets Restricted for
Continuation of Federal Programs Capital Projects Unrestricted (Deficit)
Total Net Position

EXHIBIT "A"

GOVERNMENTAL ACTIVITIES

$

3,750,628.29

80,418.03 209,720.16 104,619.14
128.00 7,483.33 99,600.44 7,607,189.58

11,859,786.97

1,670,573.00 1,219,610.00
2,890,183.00

2,490.76 485,569.73
219.56 53,244.50 4,187,222.00 3,871,248.00
15,588.47 13,746.77
8,629,329.79

257,176.00 1,712,120.00
1,969,296.00

7,624,210.28
7,483.33 467,185.12 (3,947,534.55)

$

4,151,344.18

The notes to the basic financial statements are an integral part of this statement.

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BAKER COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2020

EXHIBIT "B"

GOVERNMENTAL ACTIVITIES
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 Operations of Non-Instructional Services Enterprise Operations Food Services Interest on Long-Term Debt
Total Governmental Activities
General Revenues Taxes Property Taxes For Maintenance and Operations Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects Other Sales Tax Investment Earnings Miscellaneous
Total General Revenues
Change in Net Position
Net Position - Beginning of Year

EXPENSES

CHARGES FOR SERVICES

PROGRAM REVENUES OPERATING GRANTS AND
CONTRIBUTIONS

CAPITAL GRANTS AND CONTRIBUTIONS

NET (EXPENSES) REVENUES
AND CHANGES IN NET POSITION

$ 3,095,529.84 $
245,596.51 357,924.32
39,948.53 303,617.51 266,944.27 277,632.01 486,164.94 392,447.64
15,327.92 2,051.00
64,278.70 236,092.55
3,126.47
$ 5,786,682.21 $

25,086.10 $
-
6,678.78
-
31,764.88 $

1,487,037.54 $
242,159.85 384,697.12
40,510.92 394,332.00 145,777.00
7,208.35 78,628.02 155,808.35
-
186,899.13
-
3,123,058.28 $

245,485.32 $
23,651.46 15,630.92 155,031.76 -
-
439,799.46

(1,337,920.88)
(3,436.66) 26,772.80
562.39 90,714.49 (97,515.81) (270,423.66) (391,906.00) (81,607.53) (15,327.92) (2,051.00)
(64,278.70) (42,514.64)
(3,126.47)
(2,192,059.59)

2,402,775.66
271,350.97 20,338.52 1,369.47
137,530.38
2,833,365.00
641,305.41
3,510,038.77

Net Position - End of Year

$ 4,151,344.18

The notes to the basic financial statements are an integral part of this statement.

- 2 -

BAKER COUNTY BOARD OF EDUCATION BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2020

EXHIBIT "C"

ASSETS
Cash and Cash Equivalents Receivables, Net
Taxes State Government Federal Government Other Inventories
Total Assets
LIABILITIES
Accounts Payable Salaries and Benefits Payable Retainages Payable
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Unavailable Revenue - Property Taxes Unavailable Revenue - State Grant
Total Deferred Inflows of Resources
FUND BALANCES
Nonspendable Restricted Assigned Unassigned
Total Fund Balances

GENERAL FUND

CAPITAL PROJECTS
FUND

TOTAL

$ 3,345,727.44 $
58,148.96 169,704.96 104,619.14
128.00 7,483.33

404,900.85 $
22,269.07 40,015.20
-

3,750,628.29
80,418.03 209,720.16 104,619.14
128.00 7,483.33

$ 3,685,811.83 $

467,185.12 $

4,152,996.95

$

2,490.76 $

485,569.73

-

488,060.49

- $ 53,244.50
53,244.50

2,490.76 485,569.73
53,244.50
541,304.99

10,153.45 -
10,153.45

40,015.20
40,015.20

10,153.45 40,015.20
50,168.65

7,483.33 -
38,177.81 3,141,936.75
3,187,597.89

373,925.42
-
373,925.42

7,483.33 373,925.42
38,177.81 3,141,936.75
3,561,523.31

Total Liabilities, Deferred Inflows of Resources, and Fund Balances

$ 3,685,811.83 $

467,185.12 $ 4,152,996.95

The notes to the basic financial statements are an integral part of this statement.

- 3 -

BAKER COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET POSITION JUNE 30, 2020

EXHIBIT "D"

Total fund balances - governmental funds (Exhibit "C")
Amounts reported for governmental activities in the Statement of Net Position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds.
Land Construction in progress Buildings and improvements Equipment Land improvements Accumulated depreciation
Some liabilities are not due and payable in the current period and, therefore, are not reported in the funds.
Net pension liability Net OPEB liability
Deferred outflows and inflows of resources related to pensions/OPEB are applicable to future periods and, therefore, are not reported in the funds.
Related to pensions Related to OPEB
Taxes that are not available to pay for current period expenditures are deferred in the funds.
Georgia State Financing and Investment Commission grants that are not available to pay current period expenditures are deferred in the funds.
Long-term liabilities, and related accrued interest, are not due and payable in the current period and therefore are not reported in the funds.
Accrued interest payable Capital leases payable

$ 3,561,523.31

$

82,372.24

17,228.20

9,687,574.73

1,465,001.47

1,111,602.75

(4,656,989.37)

7,706,790.02

$ (4,187,222.00) (3,871,248.00)

(8,058,470.00)

$

1,413,397.00

(492,510.00)

920,887.00 10,153.45 40,015.20

$

(219.56)

(29,335.24)

(29,554.80)

Net position of governmental activities (Exhibit "A")

$ 4,151,344.18

The notes to the basic financial statements are an integral part of this statement.

- 4 -

BAKER COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2020

EXHIBIT "E"

REVENUES
Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
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 Enterprise Operations Food Services Operation
Capital Outlay Debt Service
Principal Interest
Total Expenditures
Revenues over Expenditures
OTHER FINANCING SOURCES (USES)
Transfers In Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning

GENERAL FUND

CAPITAL PROJECTS
FUND

TOTAL

$

2,394,769.55 $

20,338.52

2,564,738.82

632,375.46

31,764.88

226.47

137,530.38

5,781,744.08

- $ 271,350.97 354,958.80
1,143.00 -
627,452.77

2,394,769.55 291,689.49
2,919,697.62 632,375.46 31,764.88 1,369.47 137,530.38
6,409,196.85

2,622,654.99
229,141.88 340,983.84
30,530.70 288,784.76 229,186.64 260,850.03 458,557.93 383,961.92
15,327.92 2,051.00
64,278.70 232,060.34
-
16,735.36 3,231.53
5,178,337.54
603,406.54
884.57 -
884.57
604,291.11
2,583,306.78

-
2,434.00 4,290.00 16,070.30 449,517.63
-
472,311.93
155,140.84

2,622,654.99
229,141.88 340,983.84
30,530.70 291,218.76 229,186.64 260,850.03 462,847.93 400,032.22
15,327.92 2,051.00
64,278.70 232,060.34 449,517.63
16,735.36 3,231.53
5,650,649.47
758,547.38

(884.57) (884.57) 154,256.27 219,669.15

884.57 (884.57)
758,547.38 2,802,975.93

Fund Balances - Ending

$

3,187,597.89 $

373,925.42 $

3,561,523.31

The notes to the basic financial statements are an integral part of this statement.

- 5 -

BAKER COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2020

EXHIBIT "F"

Net change in fund balances total governmental funds (Exhibit "E")
Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense.
Capital outlay Depreciation expense
Taxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.
Georgia State Financing and Investment Commission grants reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities.
Capital leases issued Capital lease payments
District pension contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension/OPEB liability is measured a year before the District's report date. Pension/OPEB expense, which is the change in the net pension/OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions/OPEB, is reported in the Statement of Activities.
Pension expense OPEB expense
Some items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds.
Accrued interest on capital leases

$

758,547.38

$

534,703.94

(377,548.61)

157,155.33 8,006.11

7,620.66

$

(22,142.49)

16,735.36

(5,407.13)

$

(266,328.00)

(18,394.00)

(284,722.00)

105.06

Change in net position of governmental activities (Exhibit "B")

$

641,305.41

The notes to the basic financial statements are an integral part of this statement.

- 6 -

ASSETS Cash and Cash Equivalents
LIABILITIES Funds Held for Others

BAKER COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUNDS JUNE 30, 2020

EXHIBIT "G"

AGENCY FUNDS

$

5,593.71

$

5,593.71

The notes to the basic financial statements are an integral part of this statement.

- 7 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
REPORTING ENTITY
The Baker County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a 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.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below.
BASIS OF PRESENTATION
The School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness.
GOVERNMENT-WIDE STATEMENTS:
The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions.
The Statement of Net Position presents the School District's non-fiduciary assets, deferred outflows of resources, deferred inflows of resources and liabilities, with the difference reported as net position. Net position is reported in three categories as follows:
1. Net investment in capital assets consists of the School District's total investment in capital
assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets.
2. Restricted net position consists of resources for which the School District is legally or
contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation.
3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities.
Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs.

- 8 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
FUND FINANCIAL STATEMENTS:
The fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate financial statements are presented for governmental and fiduciary funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column.
The School District reports the following major governmental funds:
The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund.
The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST) and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets.
The School District reports the following fiduciary fund type:
Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve the measurement of results of operations.
BASIS OF ACCOUNTING
The basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes and grants. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants is recognized in the fiscal year in which all eligibility requirements have been satisfied.
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.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general longterm debt, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources.

- 9 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

The School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted resources available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues.
NEW ACCOUNTING PRONOUNCEMENTS
In fiscal year 2020, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 95, Postponement of the Effective Dates of Certain Authoritative Guidance. The primary objective of this statement is to provide temporary relief to governments and other stakeholders in light of the COVID-19 pandemic. That objective is accomplished by postponing the effective dates of certain provisions in statements and Implementation Guides that first became effective or are scheduled to become effective for period beginning after June 15, 2018, and later.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations.
RECEIVABLES
Receivables consist of amounts due from property and sales taxes, 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 basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
INVENTORIES
Food Inventories
On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the first-in, first-out basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used.
CAPITAL ASSETS
On the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art.
Capital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements.
Depreciation is computed using the straight-line method for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives.

- 10 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

Capitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows:

Capitalization Policy

Estimated Useful Life

Land

Land Improvements

$

Buildings and Improvements $

Equipment

$

Intangible Assets

$

All 5,000.00 5,000.00 5,000.00 100,000.00

N/A 10 to 50 years 15 to 80 years
5 to 50 years 10 to 15 years

DEFERRED OUTFLOWS/INFLOWS OF RESOURCES
In addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time.
LONG-TERM LIABILITIES
In the School District's government-wide financial statements, outstanding debt is reported as liabilities.
In the governmental fund financial statements, the School District recognizes the proceeds of debt as other financing sources of the current period.
PENSIONS
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees Postemployment Benefit Fund (School OPEB Fund) and additions to/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
FUND BALANCES
Fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent.
The School District's fund balances are classified as follows:
Nonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact.

- 11 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

Restricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation.

Committed consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.

Assigned consists of resources constrained by the School District's intent to be used for specific purposes but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes.

Unassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance.

USE OF ESTIMATES

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.

PROPERTY TAXES

The Baker County Board of Commissioners adopted the property tax levy for the 2019 tax digest year (calendar year) on August 19, 2019 (levy date) based on property values as of January 1, 2019. Taxes were due on December 20, 2019 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2019 tax digest are reported as revenue in the governmental funds for fiscal year 2020. The Baker County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2020, for maintenance and operations amounted to $2,230,519.03.

The tax millage rate levied for the 2019 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

14.065 mills

Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $164,250.52 during fiscal year ended June 30, 2020.
SALES TAXES
Education Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $271,350.97 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years.

- 12 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

NOTE 3: BUDGETARY DATA
The budget is a complete financial plan for the School District's fiscal year and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds, except the various school activity (principal) accounts, is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America.
The budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines, and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 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.
The Superintendent is authorized by the Board to approve adjustments of no more than 25 percent of the amount budgeted for expenditures in any budget function for any fund. The Superintendent shall report any such adjustments to the Board. If expenditure of funds in any budget function for any fund is anticipated to be more than 25 percent of the budgeted amount, the Superintendent shall request Board approval for the budget amendment. Any position or expenditure not previously approved in the annual budget that exceeds $50,000.00 shall require Board approval unless the Superintendent deems the position or purchase an emergency. In such case, the expenditure shall be reported to the Board at its regularly scheduled meeting. Under no circumstance is the Superintendent or other staff person authorized to spend funds that exceed the total budget without approval by the Board.
See the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review.
NOTE 4: DEPOSITS
COLLATERALIZATION OF DEPOSITS
O.C.G.A. 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance.
Acceptable security for deposits consists of any one of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
- 13 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

(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 of the 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 or securities guaranteed 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.
CATEGORIZATION OF DEPOSITS
Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2020, the School District had deposits with a carrying amount of $3,756,222.00, and a bank balance of $3,865,511.90. The bank balances insured by Federal depository insurance were $500,000.00.
At June 30, 2020, $3,365,511.90 of the School District's bank balances was exposed to custodial credit risk. This balance was in the State's Secure Deposit Program (SDP).
The School District participates in the State's Secure Deposit Program (SDP), a multi-bank pledging pool. The SDP requires participating banks that accept public deposits in Georgia to operate under the policy and procedures of the program. The Georgia Office of State Treasurer (OST) sets the collateral requirements and pledging level for each covered depository. There are four tiers of collateralization levels specifying percentages of eligible securities to secure covered deposits: 25%, 50%, 75%, and 110%. The SDP also provides for collateral levels to be increased in the amount of up to 125% if economic or financial conditions warrant. The program lists the types of eligible criteria. The OST approves authorized custodians.
In accordance with the SDP, if a covered depository defaults, losses to public depositors are first satisfied with any applicable insurance, followed by demands of payment under any letters of credit or sale of the covered depository collateral. If necessary, any remaining losses are to be satisfied by assessments made against the other participating covered depositories. Therefore, for disclosure purposes, all deposits of the SDP are considered to be fully collateralized.

- 14 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

NOTE 5: CAPITAL ASSETS

The following is a summary of changes in the capital assets for governmental activities during the fiscal year:

Balances July 1, 2019

Increases

Decreases

Transfers

Balances June 30, 2020

Governmental Activities Capital Assets, Not Being Depreciated:
Land Construction in Progress

$

82,372.24 $

- $

32,462.33

17,228.20

- $

- $ 82,372.24

-

(32,462.33)

17,228.20

Total Capital Assets Not Being Depreciated

114,834.57

17,228.20

-

(32,462.33)

99,600.44

Capital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements
Less Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements

9,282,498.21 1,341,615.16 1,111,602.75

394,089.43 123,386.31
-

21,475.24 -

32,462.33 -

9,687,574.73 1,465,001.47 1,111,602.75

3,455,075.14 831,945.83 13,895.03

254,052.16 95,706.38 27,790.07

21,475.24 -

-

3,687,652.06

-

927,652.21

-

41,685.10

Total Capital Assets, Being Depreciated, Net

7,434,800.12 139,927.13

-

32,462.33 7,607,189.58

Governmental Activities Capital Assets - Net $ 7,549,634.69 $ 157,155.33 $

- $

- $ 7,706,790.02

Current year depreciation expense by function is as follows:

Instruction Support Services
School Administration Maintenance and Operation of Plant Student Transportation Services

$

23,497.90

15,529.44

77,306.58

$

261,214.69

116,333.92

$

377,548.61

NOTE 6: INTERFUND TRANSFERS INTERFUND TRANSFERS Interfund transfers for the year ended June 30, 2020, consisted of the following:

Transfers to

Transfers From Capital Projects
Fund

General Fund

$

884.57

Transfers posted in prior years to move property tax revenues collected by the general fund to capital projects fund as required match or supplemental funding source for capital construction projects exceeded final project costs. Transfers are to return excess funds to the general fund.

- 15 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

NOTE 7: LONG-TERM LIABILITIES

The changes in long-term liabilities during the fiscal year for governmental activities were as follows:

Balance July 1, 2019

Governmental Activities

Balance

Additions

Deductions June 30, 2020

Due Within One Year

Capital Leases

$ 23,928.11 $ 22,142.49 $ 16,735.36 $ 29,335.24 $ 15,588.47

CAPITAL LEASES
The School District has acquired equipment under the provisions of various long-term lease agreements classified as capital leases for accounting purposes because they provide for a bargain purchase option or a transfer of ownership by the end of the lease term.
The following assets were acquired through capital leases and are reflected in the capital asset note at fiscal year-end:
Governmental Activities

Equipment

$

Less: Accumulated Depreciation

82,592.49 21,251.50

$

61,340.99

During the prior fiscal year, the School District entered into a lease agreement as lessee for financing the acquisition of communication and technology equipment at a cost of $22,142.49. This lease qualifies as a capital lease for accounting purposes, and, therefore, has been recorded at the present value of the future minimum lease payments as of the date of inception.

Capital leases currently outstanding are as follows:

Purpose

Interest Rates

Issue Date

Maturity Date

Amount Issued

Amount Outstanding

School Bus Communication Equipment

2.96% 10.495%

1/19/2018 2/22/2019

1/19/2022 $ 2/22/2022

60,450.00 $ 22,142.49

16,183.57 13,151.67

$

82,592.49 $

The following is a schedule of total capital lease payments:

Fiscal Year Ended June 30:

Principal

Interest

29,335.24

2021 2022

$

15,588.47 $

13,746.77

1,499.90 463.15

Total Principal and Interest $

29,335.24 $

1,963.05

- 16 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

NOTE 8: RISK MANAGEMENT
INSURANCE
Commercial Insurance
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; and natural disasters. Except as describe below, the School District carries commercial insurance for these risks. Settled claims resulting from these insured risks have not exceed commercial insurance coverage in any of the past three fiscal years.

Georgia School Boards Association Risk Management Fund
The School District participates in the Georgia School Boards Association Risk Management Fund (the Fund), a public entity risk pool organized on August 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, errors and omissions liability, property damage, including safety engineering and other loss prevention and control techniques, and to administer the Fund including the processing and defense of claims brought against members of the Fund. The School District pays an annual contribution to the Fund for coverage. Reinsurance is provided to the Fund through agreements by the Fund with insurance companies according to their specialty for property (including coverage for flood and earthquake), machinery breakdown, general liability, errors and omissions, crime, and automobile risks. Reinsurance limits and retentions vary by line of coverage.

WORKERS' COMPENSATION
Georgia Education Workers' Compensation Trust
The School District participates in the Georgia Education Workers' Compensation Trust (the 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 workers' compensation insurance coverage. Specific excess of loss insurance coverage is provided through an agreement by the Trust with the Safety National Casualty Company to provide coverage for potential losses sustained by the Trust in excess of $1.0 million loss per occurrence, up to the statutory limit. Employers' Liability insurance coverage is also provided with limits of $2.0 million. The Trust covers the first $1.0 million of each Employers Liability claim with Safety National providing additional Employers Liability limits up to a $2.0 million per occurrence maximum. Safety National Casualty Company also provides $2.0 million in aggregate coverage to the Trust, attaching at 107% of the loss fund and based on the Fund's annual normal premium.

UNEMPLOYMENT COMPENSATION
The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. The School District has not incurred any liabilities for unemployment compensation during the past two years.

SURETY BOND The School District purchased a surety bond to provide additional insurance coverage as follows:

Position Covered

Amount

Superintendent

$

50,000.00

- 17 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

NOTE 9: FUND BALANCE CLASSIFICATION DETAILS

The School District's financial statements include the following amounts presented in the aggregate at June 30, 2020:

Nonspendable Inventories
Restricted Capital Projects
Assigned School Activity Accounts
Unassigned

$

7,483.33

373,925.42

38,177.81 3,141,936.75

Fund Balance, June 30, 2020

$ 3,561,523.31

When multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds.

NOTE 10: SIGNIFICANT COMMITMENTS

OPERATING LEASES

The School District leases equipment under the provisions of a long-term lease agreement classified as an operating lease for accounting purposes. Rental expenditures under the terms of the operating lease totaled $12,948.00 for governmental activities for the year ended June 30, 2020. The following future minimum lease payments were required under the operating lease at June 30, 2020:

Year Ending

Governmental Activities

2021 2022 2023 2024

$

12,948.00

12,948.00

12,948.00

1,079.00

Total

$

39,923.00

NOTE 11: SIGNIFICANT CONTINGENT LIABILITIES
FEDERAL GRANTS
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 costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position.
LITIGATION
The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable but is not believed to have a material adverse effect on the financial condition of the School District.

- 18 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB)
GEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND
Plan Description: Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the School OPEB Fund - a cost-sharing multiple-employer defined benefit postemployment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board.
Benefits Provided: The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted.
Contributions: As established by the Board, the School OPEB Fund is substantially funded on a pay-asyou-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $104,877.00 for the year ended June 30, 2020. Active employees are not required to contribute to the School OPEB Fund.
OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
At June 30, 2020, the School District reported a liability of $3,871,248.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2019. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2018. An expected total OPEB liability as of June 30, 2019 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2019. At June 30, 2019, the School District's proportion was 0.031545%, which was an increase of 0.006043% from its proportion measured as of June 30, 2018.

- 19 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

For the year ended June 30, 2020, the School District recognized OPEB expense of $123,271.00. At June 30, 2020, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Deferred Outflows of Resources

OPEB

Deferred Inflows of Resources

Differences between expected and actual

experience

$

- $ 421,152.00

Changes of assumptions

134,441.00

545,723.00

Net difference between projected and actual

earnings on OPEB plan investments

8,430.00

-

Changes in proportion and differences between School District contributions and proportionate share of contributions

971,862.00

745,245.00

School District contributions subsequent to

the measurement date

104,877.00

-

Total

$ 1,219,610.00 $ 1,712,120.00

School District contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2021. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended June 30:

OPEB

2021 2022 2023 2024 2025 Thereafter

$ (153,735.00)

$ (153,735.00)

$ (154,060.00)

$ (152,987.00)

$ (32,037.00)

$

49,167.00

- 20 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

Actuarial assumptions: The total OPEB liability as of June 30, 2019 was determined by an actuarial valuation as of June 30, 2018 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2019:

OPEB:

Inflation

2.50%

Salary increases

3.00% 8.75%, including inflation

Long-term expected rate of return Healthcare cost trend rate

7.30%, compounded annually, net of investment expense, and including inflation

Pre-Medicare Eligible Medicare Eligible Ultimate trend rate

7.250% 5.375%

Pre-Medicare Eligible Medicare Eligible Year of Ultimate trend rate

4.75% 4.75%

Pre-Medicare Eligible Medicare Eligible

2028 2022

Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows:

For TRS members: The RP-2000 White Collar Mortality Table projected to 2025 with projection
scale BB (set forward 1 year for males) is used for death after service retirement and beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females) is used for death after disability retirement.
For PSERS members: The RP-2000 Blue-Collar Mortality Table projected to 2025 with
projection scale BB (set forward 3 years for males and 2 years for females) is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward 5 years for both males and females) is used for the period after disability retirement.

The actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2014, and adopted by the pension Board on December 17, 2015. The next experience study for TRS will be for the period ending June 30, 2018.
The remaining actuarial assumptions (e.g., initial per capita costs, health care cost trends, rate of plan participation, rates of plan election, etc.) used in the June 30, 2018 valuation were based on a review of recent plan experience done concurrently with the June 30, 2018 valuation.
Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation.

- 21 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. During fiscal year 2018, the School OPEB fund updated their investment strategy to a more long-term approach. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class

Target allocation

Long-Term Expected Real Rate of Return*

Fixed income Domestic Stocks -- Large Cap Domestic Stocks -- Small Cap Int'l Stocks - Developed Mkt Int'l Stocks - Emerging Mkt Alternatives

30.00% 46.20%
1.30% 12.40%
5.10% 5.00%

(0.10)% 8.90%
13.20% 8.90%
10.90% 12.00%

Total

100.00%

*Net of Inflation

Discount Rate: The discount rate has changed since the prior measurement date from 3.87% to 3.58%. In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 3.58% was used as the discount rate. This is comprised mainly of the yield or index rate for 20-year tax-exempt general obligation municipal bonds with an average rating of AA or higher (3.50% per the Bond Buyers Index). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2119. Based on these assumptions, the OPEB plan's fiduciary net position was projected to be available to make OPEB payments for inactive employees through year 2026. Therefore, the calculated discount rate of 3.58% was applied to all periods of projected benefit payments to determine the total OPEB liability.
Sensitivity of the School District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 3.58%, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (2.58%) or 1 percentage-point higher (4.58%) than the current discount rate:

1% Decrease (2.58%)

Current Discount Rate (3.58%)

1% Increase (4.58%)

School District's proportionate share of

the Net OPEB Liability

$ 4,499,669.00 $

3,871,248.00 $ 3,360,057.00

- 22 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

Sensitivity of the School District's proportionate share of the net OPEB liability to changes in the healthcare cost trend rates: The following presents the School District's proportionate share of the net OPEB liability, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage-point lower or 1percentage-point higher than the current healthcare cost trend rates:

1% Decrease

Current Healthcare Cost Trend Rate

1% Increase

School District's proportionate share

of the Net OPEB Liability

$ 3,261,117.00 $

3,871,248.00 $ 4,646,162.00

OPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the Comprehensive Annual Financial Report which is publicly available at https://sao.georgia.gov/comprehensive-annual-financial-reports.

NOTE 13: RETIREMENT PLANS
The School District participates in various retirement plans administered by the State of Georgia, as further explained below.
TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)
Plan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by O.C.G.A. 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial report that can be obtained at www.trsga.com/publications.
Benefits P rovided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.
Contributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6.00% of their annual pay during fiscal year 2020. The School District's contractually required contribution rate for the year ended June 30, 2020 was 21.14% of annual School District payroll. For the current fiscal year, employer contributions to the pension plan were $539,568.00 from the School District.

PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS)
P lan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/financials.

- 23 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

Benefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service.
Upon retirement, the member will receive a monthly benefit of $15.25, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits.
Contributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.
Individuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $12,375.00.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions
At June 30, 2020, the School District reported a liability of $4,187,222.00 for its proportionate share of the net pension liability for TRS.
The TRS net pension liability was measured as of June 30, 2019. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2018. An expected total pension liability as of June 30, 2019 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS during the fiscal year ended June 30, 2019.
At June 30, 2019, the School District's TRS proportion was 0.019473%, which was an increase of 0.003356% from its proportion measured as of June 30, 2018.
At June 30, 2020, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $52,492.00.
The PSERS net pension liability was measured as of June 30, 2019. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2018. An expected total pension liability as of June 30, 2019 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2019.
For the year ended June 30, 2020, the School District recognized pension expense of $805,247.00 for TRS and $16,188.00 for PSERS and revenue of $649.00 for TRS and $16,188.00 for PSERS. The revenue is support provided by the State of Georgia.

- 24 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

At June 30, 2020, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual experience

$ 236,013.00 $ 1,241.00

Changes of assumptions

401,819.00

-

Net difference between projected and actual earnings on pension plan investments

-

99,711.00

Changes in proportion and differences between School District contributions and proportionate share of contributions

493,173.00 156,224.00

School District contributions subsequent to the

measurement date

539,568.00

-

Total

$ 1,670,573.00 $ 257,176.00

The School District contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2021. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

2021 2022 2023 2024

$ 314,122.00 $ 108,413.00 $ 200,536.00 $ 250,758.00

Actuarial assum ptions: The total pension liability as of June 30, 2019 was determined by an actuarial valuation as of June 30, 2018, using the following actuarial assumptions, applied to all periods
included in the measurement:

Teachers Retirement System:
Inflation

2.50%

Salary increases Investment rate of return

3.00% 8.75%, average, including inflation
7.25%, net of pension plan investment expense, including inflation

Post-retirement benefit increases 1.50% semi-annually

- 25 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

Post-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service requirements and dependent beneficiaries. The RP-2000 Disabled Mortality table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.
The actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014, with the exception of the assumed investment rate of return.
Public School Employees Retirement System:

Inflation

2.75%

Salary increases Investment rate of return

N/A
7.30%, net of pension plan investment expense, including inflation

Post-retirement benefit increases

1.50% semi-annually

Post-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.
The actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014, with the exception of the assumed investment rate of return.
The long-term expected rate of return on TRS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class
Fixed income Domestic large stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative
Total
* Rates shown are net of assumed rate of inflation.

TRS Target allocation
30.00% 51.00%
1.50% 12.40%
5.10% -
100.00%

PSERS Target allocation
30.00% 46.20%
1.30% 12.40%
5.10% 5.00%
100.00%

Long-term expected real rate of return*
(0.10)% 8.90% 13.20% 8.90% 10.90% 12.00%

- 26 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2020

EXHIBIT "H"

Discount Rate: The discount rate used to measure the total TRS pension liability was 7.25%. The discount rate used to measure the total PSERS pension liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the School District's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.25%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.25%) or 1-percentage-point higher (8.25%) than the current rate:

Teachers Retirement System:

1% Decrease (6.25%)

Current Discount Rate (7.25%)

1% Increase (8.25%)

School District's proportionate share of the net pension liability

$ 6,797,086.00 $

4,187,222.00 $ 2,040,986.00

Pension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS and PSERS financial report which is publicly available
at www.trsga.com/publications and www.ers.ga.gov/financials.

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BAKER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "1"

Year Ended
2020 2019 2018

School District's proportion of the net pension liability

School District's proportionate share of the net pension liability

State of Georgia's proportionate share of the net pension liability
associated with the School District

Total

School District's covered payroll

School District's proportionate share of the net pension liability as a percentage of its
covered payroll

Plan fiduciary net position as a
percentage of the total pension liability

0.019473% $ 0.016117% $ 0.017566% $

4,187,222.00 $ 2,991,660.00 $ 3,264,695.00 $

48,076.00 13,753.00

$ 4,187,222.00 $ 3,039,736.00 $ 3,278,448.00

$ 2,376,556.00 $ 1,950,535.80 $ 2,024,988.28

176.19% 153.38% 161.22%

78.56% 80.27% 79.33%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 29 -

BAKER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "2"

Year Ended
2020 2019 2018

Contractually required contribution

Contributions in relation to the contractually required contribution

Contribution deficiency (excess)

$

539,568.00 $

539,568.00 $

-

$

496,700.00 $

496,700.00 $

-

$

322,609.00 $

322,609.00 $

-

School District's covered payroll

Contribution as a percentage of covered
payroll

$ 2,552,355.50 $ 2,376,556.00 $ 1,950,535.80

21.14% 20.90% 16.54%

This schedule is intended to show information for 10 years. Addtional years will be displayed as they become available.

- 30 -

BAKER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "3"

Year Ended

School District's proportion of the net
pension liability

School District's proportionate share of the net pension liability

State of Georgia's proportionate share of the net pension liability
associated with the School District

2020 2019 2018

0.00% $ 0.00% $ 0.00% $

-

$

-

$

-

$

52,492.00 $ 63,296.00 $ 61,265.00 $

Total

School District's covered payroll

School District's proportionate share of the net pension liability as a percentage of its
covered payroll

Plan fiduciary net position as a
percentage of the total pension liability

52,492.00 $ 63,296.00 $ 61,265.00 $

160,946.33 200,552.00 212,907.67

N/A

85.02%

N/A

85.26%

N/A

85.69%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 31 -

BAKER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY
SCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30

SCHEDULE "4"

Year Ended

School District's proportion of the net
OPEB liability

School District's proportionate share of the net OPEB liability

2020 2019 2018

0.031545% $ 0.025502% $ 0.032609% $

3,871,248.00 3,241,226.00 4,581,551.00

State of Georgia's proportionate share of the net OPEB liability
associated with the School District

$

-

$

-

$

-

Total
$ 3,871,248.00 $ 3,241,226.00 $ 4,581,551.00

School District's covered-employee
payroll
$ 2,126,028.00 $ 1,761,002.40 $ 1,725,372.62

School District's proportionate share of the
net OPEB liability as a percentage of its covered-
employee payroll
182.09% 184.06% 265.54%

Plan fiduciary net position as a
percentage of the total OPEB liability
4.63% 2.93% 1.61%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 32 -

BAKER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND
FOR THE YEAR ENDED JUNE 30

SCHEDULE "5"

Year Ended
2020 2019 2018

Contractually required contribution

Contributions in relation to the contractually required
contribution

Contribution deficiency (excess)

School District's covered-employee
payroll

$

104,877.00 $

$

169,892.00 $

$

132,175.00 $

104,877.00 $ 169,892.00 $ 132,175.00 $

-

$

2,218,298.60

-

$

2,126,028.00

-

$

1,761,002.40

Contribution as a percentage of covered-
employee payroll
4.73% 7.99% 7.51%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 33 -

BAKER COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2020

SCHEDULE "6"

Teachers Retirement System
Changes of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience.
On November 18, 2-015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP 2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males).
On May 15, 2019, the Board adopted recommended changes from the smoothed valuation interest rate methodology that has been in effect since June 30, 2009, to a constant interest rate method. In conjunction with the methodology, the long-term assumed rate of return in assets (discount rate) has been changed from 7.50% to 7.25%, and the assumed annual rate of inflation has been reduced from 2.75% to 2.50%.
Public School Employees Retirement System
Changes of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more FORVHO\UHIOHFWDFWXDOH[SHULHQFH
On-December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP 2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females).
On March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date.
School OPEB Fund
Changes of benefit terms: There have been no changes in benefit terms.
Changes in assumptions: The June 30, 2017 actuarial valuation was revised, for various factors, including the methodology used to determine how employees and retirees were assigned to each of the OPEB Funds and anticipated participation percentages. Current and former employees of State organizations (including technical colleges, community service boards and public health departments) are now assigned to State OPEB fund based on their last employer payroll location; irrespective of retirement affiliation.
The discount rate was updated from 3.07% as of June 30, 2016 to 3.58% as of June 30, 2017 to 3.87% as of June 30, 2018, and back to 3.58% as of June 30, 2019.

- 34 -

BAKER COUNTY BOARD OF EDUCATION GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2020

SCHEDULE "7"

REVENUES
Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
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 Enterprise Operations Food Services Operation
Debt Service
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Other Sources Other Uses
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Adjustments

NONAPPROPRIATED BUDGETS

ORIGINAL (1)

FINAL (1)

ACTUAL AMOUNTS

VARIANCE OVER/UNDER

$ 1,927,850.12 $ 1,927,850.12 $ 2,394,769.55 $

-

-

20,338.52

2,418,705.51

2,571,085.24

2,564,738.82

245,534.50

845,325.50

632,375.46

18,090.00

18,090.00

31,764.88

-

-

226.47

301,544.88

302,794.88

137,530.38

4,911,725.01

5,665,145.74

5,781,744.08

466,919.43 20,338.52 (6,346.42)
(212,950.04) 13,674.88 226.47
(165,264.50)
116,598.34

2,712,560.25
188,714.84 274,547.73
66,950.87 254,830.97 233,554.13 287,880.00 565,977.25 393,508.85
239,780.10 -
5,218,304.99
(306,579.98)

2,953,393.59
247,513.78 470,633.42
66,120.87 294,275.00 234,717.04 287,880.00 595,977.25 480,288.17
217,180.10 -
5,847,979.22
(182,833.48)

2,622,654.99
229,141.88 340,983.84
30,530.70 288,784.76 229,186.64 260,850.03 458,557.93 383,961.92
15,327.92 2,051.00
64,278.70 232,060.34
19,966.89
5,178,337.54
603,406.54

330,738.60
18,371.90 129,649.58
35,590.17 5,490.24 5,530.40
27,029.97 137,419.32
96,326.25 (15,327.92)
(2,051.00) (64,278.70) (14,880.24) (19,966.89)
669,641.68
786,240.02

(306,579.98) 2,603,723.92 -

41,185.00 (41,185.00)
(182,833.48) 2,603,723.92
(17,723.10)

884.57 -
884.57 604,291.11 2,583,306.78
-

(40,300.43) 41,185.00
884.57 787,124.59 (20,417.14)
17,723.10

Fund Balances - Ending

$ 2,297,143.94 $ 2,403,167.34 $ 3,187,597.89 $

784,430.55

Notes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual
(1) Original and Final Budget amounts do not include the budgeted revenues or expenditures of the various principal accounts. The actual revenues and expenditures of the various principal accounts are $90,988.26 and $75,699.12, respectively.
The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements.

See notes to the basic financial statements.

- 35 -

BAKER COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2020

SCHEDULE "8"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program
Total U. S. Department of Agriculture
Education, U. S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Grants to States Preschool Grants Preschool Grants
Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States Rural Education Rural Education Title I Grants to Local Educational Agencies Title I Grants to Local Educational Agencies Pass-Through From Mitchell County Board of Education Twenty-First Century Community Learning Centers
Total Other Programs
Total U. S. Department of Education

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

10.553 10.555

205GA324N1099 $ 205GA324N1099

46,501.40 131,412.44
177,913.84

84.027 84.027 84.173 84.173

H027A180073 H027A190073 H173A180081 H173A190081

84.048 84.358 84.358 84.010 84.010
84.287

V048A190010 S365B180010 S358B190010 S010A180010 S010A190010
S287C190010

3,060.00 87,105.68
2,599.00 4,931.05
97,695.73
8,912.85 839.94
3,574.48 39,239.53 257,294.68
47,009.86
356,871.34
454,567.07

Total Expenditures of Federal Awards

$

632,480.91

Notes to the Schedule of Expenditures of Federal Awards
Note 1. Basis of Presentation
The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of the Baker County Board of Education (the "Board") under programs of the federal government for the year ended June 30, 2020. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net position of the Board.
Note 2. Summary of Significant Accounting Policies
Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Note 3. Indirect Cost Rate
The Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.

See notes to the basic financial statements.

- 36 -

BAKER COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2020

SCHEDULE "9"

AGENCY/FUNDING
GRANTS Bright From the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program
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 Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Mid-term Adjustment Hold-Harmless Amended Formula Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Sparsity Other State Programs Computer Science Capacity Grant (CS4GA) Grant Food Services Hygiene Products Math and Science Supplements Preschool Disability Services Pupil Transportation - State Bonds Vocational Education
Georgia State Financing and Investment Commission Reimbursement on Construction Projects
Office of the State Treasurer Public School Employees Retirement

GOVERNMENTAL FUND TYPES

CAPITAL

GENERAL

PROJECTS

FUND

FUND

TOTAL

$

93,815.24 $

- $

93,815.24

40,114.00 32,038.00 132,174.00 166,300.00 84,966.00 78,453.00 144,868.00 161,462.00 35,771.00 255,380.00 53,820.00 13,616.00 10,530.00 30,031.00
9,597.00 4,810.00
243.00
291,105.00 107,612.00
54,977.00 102,431.00 (24,275.00)
130,641.00 45,000.00
368,056.00
24,360.34 6,088.00 102.00 2,101.19 5,634.05
77,220.00 13,323.00
-
12,375.00

-
-
-
-
354,958.80
-

40,114.00 32,038.00 132,174.00 166,300.00 84,966.00 78,453.00 144,868.00 161,462.00 35,771.00 255,380.00 53,820.00 13,616.00 10,530.00 30,031.00
9,597.00 4,810.00
243.00
291,105.00 107,612.00
54,977.00 102,431.00 (24,275.00)
130,641.00 45,000.00
368,056.00
24,360.34 6,088.00 102.00 2,101.19 5,634.05
77,220.00 13,323.00
354,958.80
12,375.00

$

2,564,738.82 $

354,958.80 $

2,919,697.62

See notes to the basic financial statements.

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BAKER COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2020

SCHEDULE "10"

PROJECT 2015 SPLOST

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT YEAR (3)

AMOUNT EXPENDED IN PRIOR YEARS (3)

TOTAL COMPLETION
COST

EXCESS PROCEEDS NOT
EXPENDED

(i) Repairing, improving, adding to, renovating, extending,

upgrading, and equipping school buildings, support

facilities and athletic facilities in the Baker County

School District useful or desirable in connection

therewith, including acquiring any necessary property

therefore, both real and personal;

$

910,000.00 $ 1,022,359.58 $ 59,718.20 $

962,641.38 $

- $

-

(ii) Adding classrooms;

15,000.00

15,000.00

-

-

-

-

(iii) Acquiring transportation vehicles and maintenance vehicles and equipment;

45,000.00

97,796.36

93,290.30

4,506.06

-

-

(iv) Acquiring and upgrading buses;

50,000.00

267,434.52

-

267,434.52

-

-

(v) Acquiring technology, safety, and security equipment;

15,000.00

15,000.00

2,434.00

-

-

-

(vi) Improving transportation facilities;

10,000.00

10,000.00

-

186.27

-

-

(vii) And paying expenses incidental to accomplish the foregoing, and

5,000.00

5,000.00

-

-

-

-

(viii) Debt Principal and interest payments.

350,000.00

350,000.00

-

-

-

-

1,400,000.00

1,782,590.46

155,442.50

1,234,768.23

-

-

2020 SPLOST

(i) Repairing, improving, adding to, renovating, extending,

upgrading, demolishing, and equipping school buildings,

support facilities and athletic facilities in the Baker County

School District useful or desirable in connection

therewith, including acquiring any necessary property

therefore, both real and personal;

910,000.00

910,000.00

-

-

-

-

(ii) Adding classrooms;

15,000.00

15,000.00

-

-

-

-

(iii) Acquiring transportation vehicles and maintenance vehicles and equipment;

45,000.00

45,000.00

-

-

-

-

(iv) Acquiring and upgrading buses;

50,000.00

50,000.00

-

-

-

-

(v) Acquiring technology, safety, and security equipment;

15,000.00

15,000.00

-

-

-

-

(vi) Improving transportation facilities;

10,000.00

10,000.00

-

-

-

-

(vii) And paying expenses incidental to accomplish the foregoing, and

5,000.00

5,000.00

-

-

-

-

(viii) Debt Principal and interest payments.

150,000.00

150,000.00

-

-

-

-

1,200,000.00

1,200,000.00

-

-

-

-

ESTIMATED COMPLETION
DATE
June 2021 June 2021 June 2021 June 2021 June 2021 June 2021 June 2021 June 2021
June 2026 June 2026 June 2026 June 2026 June 2026 June 2026 June 2026 June 2026

$ 2,600,000.00 $ 2,982,590.46 $ 155,442.50 $ 1,234,768.23 $

- $

-

(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 projects. Includes all cost from project inception to completion.

(3)

The voters of Baker County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include

sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

See notes to the basic financial statements.

- 39 -

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SECTION II COMPLIANCE AND INTERNAL CONTROL REPORT

(This page left intentionally blank)

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 4-101 Atlanta, Georgia 30334-8400

INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON
COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Superintendent and Members of the Baker County Board of Education
We have audited, in accordance with the 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, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Baker County Board of Education (School District), as of and for the year ended June 30, 2020, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated August 23, 2021.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

(This page left intentionally blank)

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully submitted,

August 23, 2021

Greg S. Griffin State Auditor

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SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

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BAKER COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2020
PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
No matters were reported.

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SECTION IV FINDINGS AND QUESTIONED COSTS

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BAKER COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2020
I SUMMARY OF AUDITOR'S RESULTS
Financial Statements
Type of auditor's report issued: Governmental Activities; All Major Funds; Aggregate Remaining Fund Information
Internal control over financial reporting: Material weaknesses identified? Significant deficiencies identified?
Noncompliance material to financial statements noted:
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
No matters were reported.

Unmodified
No None Reported
No