Ben Hill County Board of Education, Fitzgerald, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2001

,

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STATE OF GEORGIA

'DEPARTMENTOF 'AUDITS AND ACCOUNTS

GA
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BEN Hl[LCQUNTY80ARD OFEDUCATIOf.J
FITZGERALO,GEORGi!t R~PORTON AUDIT
OF rHEFINANCIALSTATEMENTS FOR THE FISCAL YEAR ENDED JUNE ,30, ~OOl
RU$setIW.Hinton State Auditor '

BEN HILL.COtJNTYtiOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL-PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

AND EXPENDABLE TRUST FUND

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D

STATEMENT' OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

8

E

STATEMENT OF CASH FLOWS

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

9

F NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

11

ADDmONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

24

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

26

I

FIDUCIARY FUND TYPES

COMBINING BALANCE SHEET

28

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

29

2 SCHEDULE OF STATE REVENUE

31

BEN HILL Col.JNfY BOARD OF EDUCATION
- TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDmONAL FINANCIAL INFORMATION

SCHEDULES

ALLOTMENTS AND EXPENDITURES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

3

BY PROGRAM

32

4

BY SITE

33

SECTIONll
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133

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

SECTION I FINANCIAL

RlJSSELL W. HINTON
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
July 16, 2002

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Ben Hill County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general-purpose financial statements of the Ben Hill County Board of Education, as of and for the year ended June 30, 2001, as listed in the table of contents. These general-purpose financial statements are the responsibility of the Ben Hill County Board of Education's management. Our responsibility is to express an opinion on these general-purpose financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the fmancial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall fmancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As described in the notes to the general-purpose financial statements, the Board of Education's fmancial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:

200 1ARL-13

* The general-purpose financial statements of the Board of Education did not contain a
General Fixed Assets Account Group to account for property and equipment owned by the Board of Education which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the
general-purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general-purpose financial statements.
* The Board of Education did not recognize as expenditures, in the year ended
June 30, 2001, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2001. Also funds received, subsequent to June 30, 2001, from the Georgia Department of Education for the State's share ofthese unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were improperly recorded in the year ended June 30, 2001. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general-purpose fmancial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general-purpose financial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the fmancial position of the Ben Hill County Board of Education as of June 30, 2001, and the results of its operations and the cash flows of its nonexpendable trust fund for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated July 16, 2002, on our consideration of the Ben Hill County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Ben Hill County Board of Education taken as a whole. The accompanying combining statements (Exhibits G through I) and the financial schedules (Schedules 1 through 4), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-B3, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the
200lARL-13

general-purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe general-purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general-purpose financial statements taken as a whole.
A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 506-24.
Respectfully submitted,
~ ....a( ~.~ Russell W. Hinton State Auditor
RWH:gp 2001ARL-13

BEN HILL COUNTY BOARD OF EDUCATION

BEN HILL COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 2001

ASSETS Cash and Cash Equivalents Investments Accounts Receivable Inventories
Food Donated Commodities Purchased Food
Amount Available in Debt Service Fund Amount to be Provided in Future Years
For Payment of Bond Debt
Total Assets

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$

964,845.20 $

618,150.04 $

70,654.16

2,628,444.18

200,712.94

220,362.46

28,170.67 4,488.66

$ 3,794,002.32 $

871,171.83 $===7.,;:,0~.6;;;;54;;;,.1~6~

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue General Obligation Bonds Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of State Programs For Debt Service For Endowment Corpus For Inventories Food Donated Commodities Purchased Food Unreserved Designated for Self-Insurance Undesignated
Total Fund Equity

$

22,451.46 $

80,751.87

269,064.54

9,870.07

7,749.75

$

22,451.46 $

367,436.23

$

$

22,330.28

3,749,220.58

$ 3,771,550.86 $

28,170.67 4,488.66
471,076.27 $ 503,735.60 $

70,654.16 70,654.16

Total Liabilities and Fund Equity

$ 3,794,002.32 $

871,171.83 $===7=0/:,6=54=.1=6=

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

EXHIBIT "A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPES TRUST FUNDS

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

(Memorandum Only)

JUNE 30, 2001

JUNE 30, 2000

$

87,081.02 $

7,717.18

$ 1,748,447.60 $ 1,104,178.67

770,000.00

3,777.21

3,402,221.39

3,191,915.06

18,072.49

439,147.89

626,139.12

$

875,153.51

1,359,846.49

28,170.67 4,488.66
875,153.51
1,359,846.49

25,522.91 3,978.85
773,820.36
1,716,179.64

$

875,153.51 $

11,494.39 $

2,235,000.00 $ 7,857,476.21 $ 7,441,734.61

$

103,203.33 $

.243,498.03

269,064.54

251,624.52

9,870.07

936.38

7,749.75

$

2,235,000.00

2,235,000.00

2,490,000.00

$

2,235,000.00 $ 2,624,887.69 $ 2,986,058.93

$

875,153.51

$

2,000.00

0.00

$

875,153.51 $

9,494.39 11,494.39

$

4,787.85

$

875,153.51

773,820.36

2,000.00

2,000.00

28,170.67 4,488.66

25,522.91 3,978.85

22,330.28 4,300,445.40

21,475.45 3,624,090.26

$ 5,232,588.52 $ 4,455,675.68

$

875,153.51 $

11,494.39 $

2,235,000.00 $ 7,857,476.21 $ 7,441,734.61

-3-

BEN HILL COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUND YEAR ENDED JUNE 30. 2001

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

GENERAL !FUND

GOVERNMENTAL FUND

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 15,741,133.55 $
4,488,071.62 559,968.58
$ 20,789,173.75 $

828,361.27 $ 2,422,272.55
323,952.35
3,574,586.17 $

0.00 0.00

$ 13,919,002.26 $
485,892.36 324,940.89 370,496.87 491,842.73 1,652,387.56 269,518.86 1,484,990.15 842,735.22
177,705.55

1,893,283.00
76,503.55 101,401.33
5,382.18 83,504.67
14,037.12 47,631.19
32,053.39 1,392,344.50
$

29,345.84

$ 20,018,612.45 $

$

770,561.30 $

3,646,140.93 $ -71,554.76 $

29,345.84 -29,345.84

$

$

-58,625.37

$

-58,625.37 $

58,625.37 58,625.37

$

711,935.93 $

3,059,614.93

-12,929.39 $ 513,507.42

-29,345.84 100,000.00

2,647.76 509.81

FUND BALANCE JUNE 30

$ 3,771,550.86 $

503,735.60 $ ===7=0;,6=54=.1=6=

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

EXHIBIT"B"

TYPES DEBT
SERVICE FUND

TOTAL

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUND

TOTALS (Memorandum Only)

JUNE 30,.2001

JUNE 30, 2000

$ 16,569,494.82

2,422,272.55

$

434,488.19

4,922,559.81

46,424.61

930,345.54 $

$

480,912.80 $ 24,844,672.72 $

$ 4,080.61

16,569,494.82 $ 2,422,272.55 4,922,559.81
934,426.15

15,420,450.04 2,691,838.24 4,589,275.88
821,131.04

4,080.61 $ 24,848,753.33 $ 23,522,695.20

$ 15,812,285.26 $

562,395.91 426,342.22 370,496.87 497,224.91 1,735,892.23 269,518.86 1,498,127.27 890,366.41

209,758.94 1,392,344.50
29,345.84

$

255,000.00

123,707.50

872.15

255,000.00 123,707.50
872.15

$

379,579.65 $ 24,073,678.87 $

$

101,333.15 $

770,993.85 $

1,508.19 $ 15,813,793.45 $ 14,603,622.20

562,395.91 426,342.22 370,496.87 497,224.91 1,735,892.23 269,518.86 1,498, 127.2~
890~366.41
209,758.94 1,392,344.50
29,345.84

818,812.98 596,027.79 367,566.56 504,612.26 1,517,466.82 259,658.26 1,352,820.40 752,880.36
6,608.42 333,976.41 1,324,454.33

255,000.00 123,707.50
872.15

262,187.89 135,280.18
961.61

1,508.19 $ 24,075,187.06 $ 22,836,936.47

2,572.42 $

773,566.27 $

685,758.73

$

58,625.37

-58,625.37

$

0.00

$

101,333.15 $

770,993.85 $

773,820.36

4,446,942.71

2,647.76 509.81

$

58,625.37 $

56,897.42

-58,625.37

-56,897.42

$

0.00 $

0.00

2,572.42 $ 5,144.76

773,566.27 $ 4,452,087.47

685,758.73 3,760,201.44

2,647.76 509.81

4,865.43 1,261.87

$

875,153.51 $ 5,221,094.13 $

7,717.18 $ 5,228,811.31 $ 4,452,087.47

-5-

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

EXHIBIT"C"

FUND BALANCE JUNE 30, 2001

$ 2,524,200.66 $ 3,771,550.86

$ 615,854.49 $ 503,735.60

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

BEN HILL COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30, 2001

EXHIBIT "D"

FUND BALANCE JUNE 30

$

3,777.21 $

3,777.21 $ ======.!3,=58;;,;;;8,;;;.2.1...

The notes to the general-purpose financial statements are an integral part of this statement. -8-

BEN HILL COUNTY BOARD OF EDUCATION STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 3D. 2001

EXHIBIT"E"

Cash Flows from Operating Activities: Net Cash Provided (Used) by Operating Activities
Cash Flows from Investing Activities: Purchase of Investments Interest Received on Investments
Net Increase (Decrease) in Cash Cash and Cash Equivalents - July 1
Cash and Cash Equivalents - June 30

CUMBEE-MCCALL FUND

TOTALS (Memorandum Only)
YEAR ENDED JUNE 3D, 2001 JUNE 3D, 2000

$

0.00 $

0.00 $

0.00

$

-189.00 $

-189.00 $

-138.06

189.00

189.00

138.06

$

0.00 $

0.00 $

0.00

$

0.00 $

0.00 $

0.00

$

0.00 $

0.00 $====0,;,;;.0.0...

The notes to the general-purpose financial statements are an integral part of this statement. -9-

BEN HILL COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Ben Hill County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The School District uses funds and an account group to report on its financial position and the results ofits operations. Fund accounting is designed to demonstrate legal compliance and to aid financial
management by segregating transactions related to certain governmental functions or activities. A
fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time ofpurchase. A General Fixed Assets Account Group is not presently maintained by the School District. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general-purpose financial statements.
The general-purpose financial statements account for all State,Federal, Taxes and Other funds under control of the School District, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most of a School District's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all [mancial resources of the School District except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.

- 11 -

BEN HILL COUNTY BOARD OF EDUCATION

EXHIDIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction ofmajor capital facilities.
DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees.
FIDUCIARY FUND TYPES - the funds used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include:
NONEXPENDABLETRUSTFUND Cumbee-McCall Fund - the fund used to account for an endowment ofwhich the corpus is to be invested and preserved intact with the resultant income to be used for the purpose ofproviding for the care and support of underprivileged children.
EXPENDABLE TRUST FUND Fitzgerald High School College Preparatory Fund - the fund used to account for income distributed by the Trustee and used to provide for expenditures pursuant to recommendations of an advisory committee.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding.
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental and expendable trust funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements ofthese funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.
- 12 -

BEN HILL COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
All nonexpendable trust funds are accounted for on a flow of economic resources measurement
focus. With this measurement focus, all assets and liabilities associated with the operation ofthese funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. The School District considers receivables collected within sixty days after yearend to be available and therefore susceptible to accrual. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, intergovernmental grants and donations. Revenue for property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 2001, a substantial number ofpersonnel ofthe School District were employed for a one hundred and ninety day period beginning in August 2000 and ending in early June 2001. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 2000 and ending in August 2001. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the School District in the same twelve months. As of June 30, 2001, compensation under these employment contracts had been earned, but two ofthe twelve monthly payments, due for July and August 2001, had not been made. Payments for these two months were made and recorded as expenditures by the School District subsequent to June 30,2001. Also, the State's portion ofthe compensation paid in July and August 2001 was received and recorded as revenue in the fiscal year subsequent to June 30, 2001. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were recorded in the year ended June 30, 2001. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
The accrual basis ofaccounting, as required by generally accepted accounting principles, is utilized by nonexpendable trust funds. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.

-13 -

BEN HILL COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BUDGET
The Ben Hill County Board of Education's budget is a complete financial plan for the School District's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure ofthe budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the School District's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting ofthe Board after advertisement, the Board receives comments on thetentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the School District to deposit its funds in one or more solvent banks or insured Federal savings and loan associations.
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates ofdeposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code ofGeorgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
- 14-

BEN HILL COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

(4) Obligations of any corporation of the United States government,

(5) Prime banker's acceptances,

(6) The Local Government Investment Pool administered by the State ofGeorgia, Office of Treasury and Fiscal Services,

(7) Repurchase agreements, and

(8) Obligations of other political subdivisions of the State of Georgia.

RECEIVABLES

Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from infonnation available. Receivables are recorded when either the asset or revenue recogriition criteria has been met. Receivables recorded on the general-purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.

PROPERTY TAXES

The Ben Hill County Board of Commissioners fixed the property tax levy for the 2000 tax year (calendar year) on September 14,2000 (levy date). Taxes were due on December 20,2000 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2001. The Ben Hill County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% oftaxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues during the fiscal year ended June 30, 2001 for maintenance and operations amounted to $4,438,819.98 and for school bonds amounted to $428,708.67.

Tax millage rates levied for the 2000 tax year (calendar year) for the Ben Hill County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

16.93 mills 1.49 mills

18.42 mills

- 15 -

BEN HILL COUNTY BOARD OF EDUCATION

EXHmIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVENTORIES
FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.
GENERAL OBLIGATION BONDS
The School District issues general obligation bonds to provide funds for the acquisition and construction ofmajor capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements during the year bonds are issued. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount of these bonds is recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
The School District has the following types of interfund transactions:
Reimbursements of expenditures/expenses initially made from a fund that are properly applicable to another fund are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed.
Operating transfers are recorded for all interfund transactions other than reimbursements.
MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general-purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results ofoperations or cash flows in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.

- 16-

BEN HILL COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. Ifa depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of anyone of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
CATEGORIZATION OF DEPOSITS AtJune 30, 2001, the bank balances were $7,072,639.28. The amounts ofthe total bank balances are classified into three categories of credit risk:

- 17 -

BEN HILL COUNTY BOARD OF EDUCATION

EXHmIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 2: DEPOSITS

Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the School District or by the School District's agent in the School District's name. .
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the School District's name,
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the School District's name.)

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

Risk Category

Bank Balance

1

$ 1,164,383,60

2

5,908,255.68

3

0.00

Total

$ 7,072,639.28

Note 3: NON-MONETARY TRANSACTIONS

The School District receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories

Note 4: RISK MANAGEMENT

The School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster; unemployment compensation and dental coverage.

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

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

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

- 18 -

BEN HILL COUNTY BOARD OF EDUCATION

EXHffiIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 4: RISK MANAGEMENT

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

2000 2001

Beginning of Year Liability

Claims and Changes in Estimates

$

0.00 $. 2.415.00 $

$

0.00 $ 2,300.00 $

Claims Paid

End of Year Liability

2.415.00 $ 1,800.00 $

0.00 500.00

The School District has established a limited risk management program for dental coverage of its employees and their dependents. Estimated claims are budgeted by management based on known claims and prior experience. The employees contribute a premium to the fund and the School District funds any deficits.

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

2000 2001

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

$

0.00 $ 90.462.75 $ 90.462.75 $

0.00

$

0.00 $ 115,925.07 $ 115,925.07 $

0.00

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

Position Covered

Amount

Superintendent Military Property Custodian Each Principal Director ofBudget and Finance Each Lunchroom Manager and Assistance Manager Each Secretary and Bookkeeper Payroll Administrator

$ 100,000.00 $ 25,000.00 $ 10,000.00 $ 9,000.00 $ 5,000.00 $ 5,000.00 $ 4,000.00

Note 5: OPERATING LEASES

Ben Hill County Board of Education has entered into various leases as lessee for copiers. These leases are considered for accounting purposes to be operating leases. Lease expenditures for the year ended June 30,2001, amounted to $73,950.00. Future minimum lease payments for these leases are as follows:

- 19-

BEN HILL COUNTY BOARD OF EDUCATION

EXHffiIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 5: OPERATING LEASES

Year Ending

Amount

2002 2003 2004 2005 2006

$ 96,960.00 96,960.00 96,960.00 49,600.00 390.00

Total

$ 340,870.00

Note 6: GENERAL LONG-TERM DEBT

GENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows:

Purpose

Interest Rates

Amount

General Government - Series 1993

2.65% - 5.35% $ 2,235,000.00

The changes in General Long-Tenn Debt during the fiscal year ended June 30, 2001, were as follows:

General Obligation
Bonds

Balance July 1,2000

$ 2,490,000.00

Deductions Debt Retired

255,000.00

Balance June 30, 2001

$ 2,235,000.00

At June 30, 2001, payments due by fiscal year which includes principal and interest for these items are as follows:

- 20-

BEN HILL COUNTY BOARD OF EDUCATION

EXHffiIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 6: GENERAL LONG-TERM DEBT

Fiscal Year Ended June 30

General Obligation
Bonds

2002 2003 2004 2005 2006 2007 - 2011

$ 382,360.00 384,940.00 386,402.50 386,702.50 390,952.50 788,762.50

Total Principal and Interest

$ 2,720,120.00

Note 7: ON-BEHALF PAYMENTS

The School District has recognized revenues and expenditures in the amount of $267,232.92 for health insurance and retirement contributions paid on the School District's beha1fby the following State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance of Non-Certified Personnel In the amount of $206,356.39

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$21,729.53

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $39,147.00

Note 8: CONTINGENT LIABILITIES

Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position.

- 21 -

BEN HILL COUNTY BOARD OF EDUCATION

EXHffiIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 9: SUBSEQUENT EVENTS
On September 18, 2001, the voters of Ben Hill County voted in favor of a Special Purpose Local Option Sales Tax referendum for education purposes. The imposition of the tax approved by the voters, as stated on the Official Ballot of Ben Hill County, is as follows:
"Shall a special one percent sales and use tax be imposed in Ben Hill County for a period of time not to exceed five years (20 calendar quarters), commencing January 1, 2002, and for the raising of not more than $13,996,318.50 for the purpose of retiring up to $1,294,527.50 of previously incurred general obligation debt Series 1993 General Obligation School Bonds, Ben Hill County School District, the same having been incurred for capital outlay projects for educational purposes, and for the raising of not more than $12,701,791.00 for the purpose of funding the modification, remodeling, renovation, improving, and additions to existing educational facilities and the acquisitions ofsystem-wide technology improvements for student educational purposes more particularly described as follows: the replacement of the ceiling, the replacement of certain lighting, the replacement of certain heating, ventilating, and air conditioning units, the replacement or addition of certain kitchen serving lines, certain additions to the science lab, and related facilities and costs at the Fitzgerald High School; the replacement of the ceiling, the installation of certain lighting, the replacement of certain heating, ventilation, and air conditioning equipment, .the replacement ofthe kitchen floor, and related facilities and costs at the Ben Hill Elemeni3ry School; the acquisition and installation ofa storm drainage system and related facilities and costs at the Ben Hill Primary School; the construction and addition ofa weight room and dressing room and related facilities and costs at the Fitzgerald High School; the addition ofa weight room, the addition of a dressing room, the addition of a running track, the addition of grand stands, the development of a playing field, and related facilities and costs at the Ben Hill Middle School; the acquisition of new computer equipment to be used system-wide for students' educational purposes with related facilities and costs; certain floor covering, provisions for handicapped, painting, reroofing, and modification to the heating, ventilating and air conditioning system, together with related facilities and costs at the Ben Hill County Pre-K School; and the renovation offloor covering, ceilings, handicapped facilities, and painting, together with modification of the heating, ventilating, and air conditioning system, reroofing, the auditorium, walkway covers, site work, fire code requirements, exterior work, parking and paving, together with related facilities and costs at the Ben Hill Elementary School; the maximum cost of the retirement of said previously incurred debt and new projects not to exceed $13,996,318.50? Ifimposition ofthe tax is approved by the voters, such vote shall also constitute approval of the issuance of general obligation debt of Ben Hill County School District in the principal amount of $8,400,000.00 for the above purposes."

- 22-

BEN HILL COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO TIlE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 10: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school districts are covered by the Teachers Retirement System ofGeorgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe School District who are covered by TRS are required by State statute to contribute 5% of their gross earningsto TRS. The School District makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11 ~29% and .employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2001 2000 1999

100% 100% 100%

$ 1,548,836.86 $ 1,469,222.68 $ 1,465,339.09

- 23-

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

ASSETS
Cash and Cash Equivalents
Accounts Receivable
Inventories Food Donated Commodities Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

551.199.09 $

90,316.47

3.582.09

28.170.67 4,488.66

Total Assets

$

587,440.51 $===9=0...3.=16,;,;.4...7=

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of State Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity
Total Liabilities and Fund Equity
See notes to the general-purpose financial statements.
- 24-

$

15.717.31 $

21,607.92

67,987.60

68,374.37

334.18

$

83,704.91 $

90,316.47

$

28.170.67

4.488.66

471,076.27 $

0.00

$

503,735.60 $

0.00

$

587,440.51 $ ===9=0..3..=16,;,;..4..7=

EXHIBIT"G"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

JUNE 30, 2001

JUNE 30, 2000

$

481.31 $

641,996.87 $

594,078.14

$

216,780.37

220,362.46

418,532.93

28,170.67 4,488.66

25,522.91 3,978.85

$

216,780.37 $

481.31 $

895,018.66 $ 1,042,112.83

$

23,846.83

43,426.64

132,702.57

9,054.58 $

7,749.75

$

216,780.37 $

$ 481.31 481.31 $

23,846.83 $ 80,751.87 269,064.54
9,870.07 7,749.75
391,283.06 $

156,233.94 120,940.16 250,494.93
936.38
528,605.41

$

0.00 $

$

0.00 $

$

216,780.37 $

$

4,787.85

$
0.00 0.00 $

28,170.67 4,488.66
471,076.27
503,735.60 $

25,522.91 3,978.85
479,217.81
513,507.42

481.31 $

895,018.66 $ 1,042,112.83

- 25-

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

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration School Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Operating Transfers In
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

104,856.00 $

955,208.63

323,632.35

$ 1,383,696.98 $

723,505.27 723,505.27

$

$ 1,391 ,838.52

$ 1,391 ,838.52 $

$

-8,141.54 $

584,757.43 51,084.05 1,083.83 35,170.18 14,037.12 37,372.66
723,505.27 0.00

$

-8,141.54 $

508,719.57

2,647,76 509.81

0.00 0.00

$

503,735.60 $ = = = = 0...,=0.0...

See notes to the general-purpose financial statements. - 26-

EXHIBIT"H"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$ $ 1,467,063.92
320.00
$ 1,467,383.92 $

0.00 $ ---=0.;.:0:::0.... $

828,361.27 $ 2,422,272.55
323,952.35
3,574,586.17 $

766,255.33 2,691,838.24
345,150.73
3,803,244.30

$ 1,303,737.72 $

25,419.50 100,317.50
5,382.18 48,334.49

10,258.53 32,053.39
505.98

$ 1,526,009.29 $

$

-58,625.37 $

4,787.85 $
4,787.85 $ -4,787.85 $

1,893,283.00 $
76,503.55 101,401.33
5,382.18 83,504.67 14,037.12 47,631.19 32,053.39 1,392,344.50
3,646,140.93 $
-71,554.76 $

2,092,652.26
76,152.19 150,455.43
9,354.30 43,940.65 40,427.41 55,478.50 59,824.13 1,324,140.57
3,852,425.44
-49,181.14

58,625.37

58,625.37

56,897.42

$

0.00 $

-4,787.85 $

-12,929.39 $

7,716.28

0.00

4,787.85

513,507.42

499,663.84

2,647.76 509.81

4,865.43 1,261.87

$

0.00 $

0.00 $

503,735.60 $ =====5;;,,;1=3;,;;;,5=07=.4.,;,;2=

- 27-

BEN HILL COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 30. 2001

EXHIBIT "I"

ASSETS Cash and Cash Equivalents Investments
Total Assets
FUND EQUITY Fund Balances
Reserved For Endowment Corpus
Unreserved Undesignated
Total Fund Equity

NONEXPENDABLE TRUST FUND CUMBEEMCCALL FUND

EXPENDABLE TRUST FUND FITZGERALD HIGH SCHOOL
COLLEGE PREPARATORY
FUND

TOTALS JUNE 30, 2001 JUNE 30, 2000

$

7,717.18 $

7,717.18 $

1,556.55

$

3.777 .21

3,777.21

7,176.42

$

3,777.21 $

7,717.18 $

11,494.39 $==-==8..,.7..3.;;;;,2.=97=

$

2,000.00

$

2,000.00 $

2,000.00

1,777.21 $ _ _-.:7..:.:,7...:.1.:..:7...:.:18~

9,494.39

6,732.97

$

3,777.21 $

7,717.18 $

11,494.39 $=.........=8.,7=32=..9.7. =

See notes to the general-purpose financial statements.

- 28-

BEN HILL COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30,.2001

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

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

.. 10,553 10,555

N/A

$ 180,871,69

(2)

N/A

688,398,34 $

1,305,899,92 (3)

Total Child Nutrition Cluster

$ 869,270.03 $

1,305,899,92

Other Programs

Pass-Through From Georgia Department of Education

Food and Nutrition Program

Food Distribution Program (1)

10,550

N/A

85,938.60

85,938,60

Total U, S, Department of Agriculture

$ 955,208,63 $

1,391,838,52

Corporation for National and Community Service Pass-Through From Georgia Department of Education Learn and Serve America School and Community Based Programs

94.004

N/A

$

9,168,20 $

9,168.20

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

84,173 84,027 84.173

N/A

$

519,75 $

N/A

250,912.47

N/A

42,000,82

519,75 250,912,47
42,000,82

Total Special Education Cluster

$ 293,433,04 $

293,433,04

Other Programs

Pass-Through From Georgia Department of Education

Elementary and Secondary Education Act

Title I

Grants to Local Educational Agencies

84,010

NlA

Title II

Eisenhower Professional Development

84,281

NlA

Title VI

Class Size Reduction

84,340

N/A

Innovative Education Program Strategies

84,298

N/A

Safe and Drug-Free Schools

84.186

N/A

Vocational Education - Basic Grants to States

High School Program

Basic Grant

84.048

N/A

Tech Prep Education

84,243

N/A

Pass-Through From National Center for Community

Education

Twenty First Century Community Learning Centers/

After School Learning Centers

84.287

N/A

Pass-Through From Office of School Readiness

Elementary and Secondary Education Act

Title II

Eisenhower Professional Development

84.281

N/A

823,127,88 22,124.00
112,949.11 28,775.00 14,032,00
42,527.28 6,736.30
76,840,37
3,269,83

823,127,88 22,124,00
112,949,11 28,775,00 14,032,00
42,527,28 6,736,30
77,160,37 (3)
3,269,83

Total U, S, Department of Education

- 29-

$ 1,423,814,81 $

1,424,134,81

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

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
OTHER FEDERAL ASSISTANCE
Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program

CFDA NUMBER

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

$ 34,080.91 $

92,706.28 (3)

Total Federal Financial Assistance
= N/A Not Available

$ 2,422,272.55 $===2,..,9,;,;17=,8:.;4=7,;,;;.8=1

Notes to the Schedule of Expenditures of Federal Awards

(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2001 National School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures are not maintained by fund source.

Major Programs are identified by an asterisk (*) in front of the CFDA number.

The School District did not provide Federal Assistance to any Subrecipient.

The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Ben Hill County Board of Education and is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the general-purpose financial statements.

See notes to the general-purpose financial statements.

- 30-

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

SCHEDULE "2"

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

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$

768,039.00

117,076.00

1,964,537.00

343,334.00

1,098,043.00

2,119,838.00

1,499,001.00

812,961.00

355,051.00 550,663.00 216,173.00
18,798.00 125,289.00 240,867.00 158,120.00 66,895.00 330,447.00 83,359.00 2,060,122.00

$

768,039.00

117,076.00

1,964,537.00

343,334.00

1,098,043.00

2,119,838.00

1,499,001.00

812,961.00

355,051.00 550,663.00 216,173.00
18,798.00 125,289.00 240,867.00 158,120.00 66,895.00 330,447.00
83,359.00 2,060,122.00

374,092.00 91,066.00 81,731.00 13,704.00 28,258.00
304,526.00 1,405,295.00
$ 49,031.00
35,000.00 7,176.75
206,356.39 5,000.00
52,253.84 5,696.79
14,819.00 21,729.53

104,856.00 72,066.28

374,092.00 91,066.00 81,731.00 13,704.00 28,258.00
304,526.00 1,405,295.00
104,856.00 49,031.00
35,000.00 7,176.75
206,356.39 5,000.00
52,253.84 5,696.79
14,819.00 21,729.53
72,066.28

651,438.99

651,438.99

39,147.00

39,147.00

46,203.00 31,435.25

46,203.00 31,435.25

See notes to the general-purpose financial statements.

$ 15,741,133.55 $

828,361.27 $ 16,569,494.82

- 31 -

BEN HILL COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBEl
ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 3D, 2001

SCHEDULE "3"

DESCRIPTION

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

Direct Instructional Programs

Kindergarten Program

$

Kindergarten Program-Early Intervention Program

Primary Grades (1-3) Program

Primary Grades-Early Intervention (1-3) Program

Upper Elementary Grades (4-5) Program

Middle Grades (6-8) Program

Middle School (6-8) Program

High School General Education (9-12) Program

Vocational Laboratory (9-12) Program

Students with Disabilities

Category II

Category III

Category IV

Gifted Student - Category VI

Remedial Education Program

Alternative Education Program

English Speakers of Other Languages (ESOL)

840,019,00 $ 128,048.00 2,148,653.00 375,511,00 1,200,951.00
2,318,509.00 1,639,487.00
889,152.00 1,247,590.00
137,032.00 263,441.00 172,939,00
73,164.00

863,028,59 $ 280,758.63 1,842,553.25 630,919.76 1,363,340,79
1,346.40 2,240,282.50 1,869,944.63
734,871.28
476,478.54 739,431.38 185,695.04 191,760.80 415,320.33 332,034.35
59,526.65

11,177.38 $ 3,981.94
63,674,49 10,346.23 45,983.85
67,695.26 105,618.49 103,996.83
17,818.34 29,265.39 38,272.45
1,027.82
3,674.46 3,003.17

874,205,97 284,740.57 1,906,227.74 641,265.99 1,409,324.64
1,346.40 2,307,977.76 1,975,563.12
838,868.11
494,296.88 768,696,77 223,967.49 192,788.62 415,320,33 335,708.81
62,529.82

TOTAL DIRECT INSTRUCTIONAL PROGRAMS
Media Center Program Staff and Professional Development

$

11,434,496.00 $ 12,227,292,92 $ 505,536,10 $ 12,732,829.02

361,416.00

.. 283,567.49

82,514.34

366,081.83

91,171,00

67,835.04

55,132.95

122,967,99

TOTAL QBE FORMULA FUNDS

$

11,887,083.00 $ 12,578,695.45 $ 643,183.39 $ 13,221,878.84

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

See notes to the general-purpose financial statements.

- 32-

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

SCHEDULE "4"

Ben Hill County Primary School Fitzgerald High School Ben Hill County Middle School Ben Hill County Elementary School Pre-K Center Central Office (Alternative Education Program)
TOTAL
(1) Comprised of State Funds plus Local Five Mill Share.

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

2,819,499,00 $

3,048,823.30

3,158,416,00

3,735,518.54

2,684,617,00

2,862,109.99

2,599,025.00

3,003,786.73

21,340.46

172,939.00

61,250.00

$

11,434,496.00 $ 12,732,829.02

See notes to the general-purpose financial statements. - 33-

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

RUSSELL W. HINTON
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.w., Suite 214
Atlanta, Georgia 30334-8400
July 16, 2002

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members of the State Board of Education
and Superintendent and Members of the Ben Hill County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED INACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements of Ben Hill County Board of Education as of and for the year ended June 30, 2001, and have issued our report thereon dated July 16, 2002. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general-purpose financial statements. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether Ben Hill County Board of Education's financial statements are free of material misstatement, we perfonned tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the detennination offmancial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit, and accordingly, we do not express such an opinion. The results ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and perfonning our audit, we considered Ben Hill County Board ofEducation's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal
2001YB-41

control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Ben Hill County Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-6091-01-02.
A material weakness is a condition in which the design or operation of one or more ofthe internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, we consider item FS-6091-01-02 to be a material weakness.
This report is intended solely for the information and use of the management, members ofthe Ben Hill County Board of Education, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
~.~l~
Rus ell W. Hinton State Auditor
RWH:gp 2001YB-41

RlJSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
July 16, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Ben Hill County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULARA-133
Ladies and Gentlemen:
Compliance
We have audited the compliance of Ben Hill County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended June 30, 2001. Ben Hill County Board ofEducation's major Federal programs are identified in the Summary of Auditor's Results Section of the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility ofBen Hill County Board of Education's management. Our responsibility is to express an opinion on Ben Hill County Board of Education's compliance based on our audit.
We conducted our audit ofcompliance in accordance with auditing standards generally accepted in the United States ofAmerica; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States; and OMB Circular A133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types ofcompliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Ben Hill County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Ben Hill County Board ofEducation's compliance with those requirements.
2001SA-I0

In our opinion, the Ben Hill County Board ofEducation complied, in all material respects, with the requirements referred to above that are applicable to each ofits major Federal programs for the year ended June 30, 2001.
Internal Control Over Compliance
The management of Ben Hill County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Ben Hill County Board ofEducation's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose ofexpressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133.
Our consideration ofthe internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level of risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course ofperforming their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended solely for the information and use ofthe management, members ofthe Ben Hill County Board of Education, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
~e:;'~~n~ State Auditor
RWH:gp 2001SA-IO

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

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

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-6091-99-01 FS-6091-99-04 FS-6091-00-01 FS-6091-00-02

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

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6091-00-02

At this time, Ben Hill County Board ofEducation does not employ enough staffto record a general fixed assets listing on the formal accounting records.

SECTION IV FINDINGS AND QUESTIONED COSTS

BEN HILL COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001
I SUMMARY OF AUDITOR'S RESULTS
1. Type of Report Issued on the Financial Statements The auditor's opinion on the Ben Hill County Board ofEducation's financial statements was qualified for various departures from generally accepted accounting principles.
2. Reportable Conditions in Internal Control Disclosed by the Audit ofthe Financial Statements The audit report for the Ben Hill County Board ofEducation disclosed a financial statement reportable condition related to the following controlcategory.
General Fixed Assets
The reportable condition described above is considered to be a material weakness.
3. Noncompliance Material to the Financial Statements The audit of the Ben Hill County Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements.
4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Ben Hill County Board ofEducation did not disclose any reportable conditions in internal control over major programs.
5. Type of Report Issued on Compliance for Maior Programs The auditor's opinion on the Ben Hill County Board of Education's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be Reported by Section .510(a) ofOMB Circular A-133 The Ben Hill County Board ofEducatiqn's audit did not disclose audit findings required to be reported by section .5lO(a) ofOMB Circular A-133.
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
9. Low Risk Auditee The Ben Hill County Board of Education qualified as a low risk auditee based on a waiver granted by the U. S. Department of Education.
- 1-

BEN HILL COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001
IT FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-6091-01-02 The Ben Hill County Board ofEducation did not establish a General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general-purpose financial statements ofthe School District being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the School District to establish accounting controls and procedures to provide for maintenance ofa General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings and equipment owned by the School District and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. Management's Response: At the August 13,2002 meeting ofthe Ben Hill County Board ofEducation, a motion was made and properly seconded to secure the services of The Valuation Advisory Group to provide services and perform activities that would establish a General Fixed Assets Account Group. They will be responsible for providing services to make our School System GASB 34 compliant. ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
-2-