lJ111 A800 .. R\ 26 E~3 1993'-'1q AUDIT REPORT BULLOCH COUNTY BOARD OF EDUCATION STATESBORO, GEORGIA YEAR ENDED JUNE 30, 1999 \..-------~ _ _~~ ~_ _.J STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS 254 WASHINGTON STREET ATLANTA, GEORGIA 30334-8400 BULLOCHCOUNJY BOARD 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 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 NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS 8 ADDmONAL FINANCIAL INFORMATION COMBINING STATEMENTS SPECIAL REVENUE FUND E COMBINING BALANCE SHEET 20 F COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 22 CAPITAL PROJECTS FUND G COMBINING BALANCE SHEET 24 H COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 25 SCHEDULES 1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 26 2 SCHEDULE OF STATE REVENUE 28 3 SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS 29 ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS 4 OVERALL 31 5 BY PROGRAM 32 BULLOCH COUNTY BOARD OF EDUCATION TABLE OF CONTENTS SECTION II 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 WITII GOVERNMENT AUDITING STANDARDS REPORT ON COMPLIANCE WITII REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITII OMB CIRCULAR A-B3 SECTION ill AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS SECTION I FINANCIAL RUSSELL W. HINTON STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 April 13, 2000 Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board of Education and Superintendent and Members of the. Bulloch County Board ofEducation 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 Bulloch County Board of Education, as of and for the year ended June 30, 1999, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe Bulloch 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 generally accepted auditing standards 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 ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used. and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows: * The general purpose financial statements of the Board did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles. 99ARL-13 * 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 aggregate effects on the general purpose financial statements of these variances or omissions have not been detennined, but are believed to be material. In our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the Bulloch County Board of Education as of June 30, 1999, and the results of its operations for the year then ended, in confonnity with generally accepted accounting principles. In accordance with Government Auditing Standards, we have also issued our report dated April 13, 2000, on our consideration of the Bulloch County Board ofEducation's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. Our audit was performed for the purpose of forming an opinion on the general purpose financial statements of the Bulloch County Board of Education taken as a whole. The accompanying combining statements (Exhibits E through H) and the financial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations, are presented for purposes ofadditional analysis and are not a required part ofthe general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24. Respectfully submitted, ~w.~ Russell W. Hinton State Auditor RWH:jb 99ARL-13 BULLOCH COUNTY BOARD OF EDUCATION ASSETS Cash and Cash Equivalents Investments Accounts Receivable Due from Other Funds Inventories Food Donated Commodities Purchased Food Amount Available in Debt Service Fund Amount to be Provided in Future Years For Payment of: Bond Debt Capital Lease Agreements Total Assets BULLOCH COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP JUNE 30, 1999 GENERAL FUND GOVERNMENTAL FUND TYPES SPECIAL CAPITAL REVENUE PROJECTS FUND FUND $ 3,746,643.96 $ 4,901,599.64 2,826,434,77 5,708,943.39 $ 1,826,102.49 1,655,125.94 705,820.83 82,747.01 15,309.63 $ 12,987,842.95 $ 1.924,159.13 $ 6,556,725.58 -2- EXHIBIT "A" DEBT SERVICE FUND ACCOUNT GROUP GENERAL LONG-TERM DEBT TOTALS (Memorandum Only) JUNE 30,1999 JUNE 30,1998 $ 15,636.82 $ 8,663.880.42 $ 18,027,050.59 859,155.40 3,685.590.17 2,684,902.28 9.190,171.82 9,116,299.60 705,820.83 657,680.83 82.747.01 15,309.63 96.539.38 17.582.96 $ 168,971.39 168,971.39 164,220.67 18.216.028.61 18.216.028.61 18.835,n9.33 87,128.17 $ 874.792.22 $ 18,385.000.00 $ 40,728,519.88 $ 49,687,183.81 $ 798.270.91 1,529.673.37 $ 1,365.858.39 4,733.797.35 4,180,943.02 3,493.55 2.292.72 934,945.25 981,054.16 $ 705,820.83 705.820.83 657.680.83 87.128.17 $ 18,385.000.00 18.385.000.00 19,000.000.00 $ 705,820.83 $ 18.385.000.00 $ 27,091,001.26 $ 26,274.957.29 $ 168.971.39 0.00 $ 168,971.39 $ 3.950.83 $ 630.89 15.640.74 168,971.39 164,220.67 82.74701 15,309.63 4,758,676.68 41,275.69 96,539.38 17,582.96 13.185,461.20 422.119.81 8.550,946.65 9,525,671.61 $ 13.637,518.62 $ 23,412.226.52 $ 874.792.22 $ 18,385,000.00 $ 40.728,519.88 $ 49,687,183.81 -3- BULLOCH COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1999 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 SPECIAL REVENUE FUND $ 31,788,537.88 $ 99,216.96 14,835,914.95 729,626.93 $ 47,453,296.72 $ 787,896.17 4,329,957.28 1,024,644.90 6,142,498.35 $ 30,904,616.58 $ 2,251,998.78 968,445.86 1,203,975.82 370,538.96 3,321,872.88 266,412.64 3,804,604.53 2,359,361.28 596,955.25 127,486.23 627.92 300,124.23 87,128.17 71.64 2,201,131.81 282,889.94 81,295.57 55,463.28 96,808.72 878.40 84,300.78 3,333,476.63 $ 46,564,220.77 $ 6,136.245.13 $ 889,075.95 $ _ _--'6=,2:;,;:5~3=.2=2 $ $ -4,395.10 $ -4.395.10 $ $ 884,680.85 $ 6,262,798.20 4,395.10 4,395.10 10,648.32 704,705.23 -13,792.37 -2,273.33 FUND BALANCE JUNE 30 $ 7,147,479.05 $ The notes to the general purpose financial statements are an integral part of this statement. -4- 699,287.85 EXHIBIT"B" CAPITAL PROJECTS FUND DEBT SERVICE FUND TOTALS (Memorandum Only) YEAR ENDED JUNE 30,1999 JUNE 30,1998 $ 8,211,654.22 $ $ 471,369.44 1,610,350.44 41,878.01 $ 8,683,023.66 $ 1,652,228.45 $ 40,788,088.27 $ 4,429,174.24 16,446,265.39 2,267,519.28 63,931,047.18 $ 36,826,081.68 4,221,111.13 15,300,340.28 2,459,400.81 58,806,933.90 $ $ 19,341,745.75 $ $ 19,341.745.75 $ $ -10,658,722.09 $ 615,000.00 1,025,640.00 6,837.73 1,647,477.73 $ 4,750.72 $ 33,105,748.39 $ 2,534,888.72 1,049,741.43 1,259,439.10 467,347.68 3,322,751.28 266,412.64 3,804,604.53 2,359,361.28 596,955.25 211,787.01 3,334,104.55 19,641,869.98 702,128.17 1,025,711.64 6,837.73 73,689,689.38 $ -9,758,642.20 $ 29,500,698.95 2,305,773.47 898,728.03 1,288,122.10 434,028.28 3,174,162.66 189,604.62 3,096,904.09 2,168,066.96 890,736.04 184,588.68 3,363,955.59 17,634,751.64 794,749.75 1,202,914.64 7,417.95 67,135,203.45 -8,328,269.55 $ -10,658,722.09 $ 16,280,502.42 $ $ 4,750.72 $ 164,220.67 4,395.10 $ -4,395.10 0.00 $ 3,296,176.77 -3,296,176.77 0.00 -9,758,642.20 $ 23,412,226.52 -8,328,269.55 31,719,879.83 -13,792.37 -2,273.33 12,603.53 8,012.71 $ 5,621,780.33 $ 168,971.39 $ 13,637,518.62 $ 23,412,226.52 -5- BULLOCH 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 30.1999 EXHIBIT"C" GENERAL FUND ACTUAL (BUDGET BUDGET BASIS) REVENUES State Funds Federal Funds Taxes Other Funds $ 30,729,916.78 $ 31,788,537.88 89,404.75 99,216.96 13,525,150.00 14,835,914.95 271,123.00 729,626.93 Total Revenues $ 44,615,594.53 $ 47,453,296.72 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 $ 30,947,892.88 $ 30,904,616.58 2,485,862.56 960,175.28 1,315,841 .34 415,648.00 . 3,240,214.94 306,737.00 3,057,833.03 2,204,253.00 402,156.00 169,929.64 374,560.00 2,251,998.78 968,445.86 1,203,975.82 370,538.96 3,321,872.88 266,412.64 3,804,604.53 2,359,361.28 596,955.25 127,486.23 627.92 300,124.23 87,199.81 Total Expenditures $ 45,881,103.67 $ 46,564,220.77 Excess of Revenues over (under) Expenditures $ -1,265,509.14 $ 889,075.95 OTHER FINANCING SOURCES (USES) Other Sources Other Uses $ 250,000.00 -298,140.00 $ -4,395.10 Total Other Financing Sources (Uses) $ -48,140.00 $ -4,395.10 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ -1,313,649.14 $ 884,680.85 FUND BALANCE JULY 1. 1998 5,929,180.56 6,262,798.20 Adjustments Food Inventory - Net Change in Period Donated Commodities Purchased Food -14,772.80 FUND BALANCE JUNE 30.1999 $ 4,600,758.62 $ 7,147,479.05 SPECIAL REVENUE FUND ACTUAL (BUDGET BUDGET BASIS) $ 769,067.03 $ 787,896.17 5,122,331.09 4,329,957.28 959,300.00 1,024,644.90 $ 6,850,698.12 $ 6,142,498.35 $ 2,583,233.99 $ 2,201,131.81 429,926.72 137,778.96 53,260.92 104,588.06 868.50 282,889.94 81,295.57 55,463.28 96,808.72 878.40 92,000.00 177,899.20 3,454,635.77 84,300.78 3,333,476.63 $ 7,034,192.12 $ 6,136,245.13 $ -183,494.00 $ 6,253.22 $ 4,600.00 $ 4,395.10 $ 4,600.00 $ 4,395.10 $ -178,894.00 $ 691,364.97 3,451.93 10,648.32 704,705.23 -13,792.37 -2,273.33 $ 515,922.90 $ 699,287.85 The notes to the general purpose financial statements are an integral part of this statement. -7- BULLOCH COUNTy BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS ruNE 30. 1999 Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES REPORTING ENTITY The Bulloch County Board ofEducation (Board) was established under the laws ofthe State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board 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 Board is a primary government and consists of all the organizations that compose its legal entity. FUND ACCOUNTING The Board uses funds and an account group to report on its financial position and the results ofits operations. Fund accounting is designed to demonstql.te 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 Board. 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 ofthese 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 ofthe Board, 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 ofa Board's educational activities. Governmental Fund Types include: GENERAL FUND - the fund used to account for all financial resources ofthe Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board ofeducation. SPECIAL REVENUE FUND - the fund used to account for the proceeds ofspecific revenue sources (other than for major capital projects.) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department ofEducation and from the Federal government to accomplish specific educational objectives. -8- BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS ruNE 30. 1999 Note 1; SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, generallong-tenn principal, interest and paying agent fees. ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding and capital lease obligations. BASIS OF ACCOUNTING The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (Le., 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-Tenn Debt Account Group. Governmental funds are accounted for using the modified accrual basis of accounting under which: Revenues are recognized when susceptible to accrual (Le., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Those revenues considered susceptible to accrual are property taxes, local option sales taxes, intergovernmental grants and investment income. Expenditures are generally recognized when the related fund liability is incurred. A substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August of 1998 and ending in early June 1999. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1998 and ending in August 1999. State grants to fund the State's share of these contracts are disbursed to the Board in the same twelve month period. In accordance with generally accepted accounting principles, salary and fringe benefit expenditures and the related revenue from the State to fund these contracts are recorded in the fiscal period covered by these financial statements. -9- BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1999 Note 1; SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BUDGET The Bulloch County Board ofEducation's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level ofbudget control was established by the 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 Board'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 the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department ofEducation. 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 COMPOSmON OF DEPOSITS Cash and cash equivalents consist ofdeposits in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. INVESTMENTS COMPOSITION OF INVESTMENTS Investments made by the Board in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracfs and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board 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 ofsafety and liquidity. Funds may be invested in the following: (1) Obligations issued by the State of Georgia or by other states, (2) Obligations issued by the United States government, (3) Obligations fully insured or guaranteed by the United States government or a United States government agency, -10 - BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1999 Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES (4) Obligations of any corporation of the United States government, (5) Prime banker's acceptances, (6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services, (7) Repurchase agreements, and (8) Obligations of other political subdivisions of the State of Georgia. RECEIVABLES Receivables consist ofgrant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose financial statements do not include any amounts whieh would necessitate the need for an allowance for uncollectible receivables. PROPERTY TAXES The Bulloch County Board ofCommissioners fixed the property tax levy for the 1998 tax year (calendar year) on October 12,1998 (levy date). Taxes were due on December 31, 1998. The lien date for property taxes was January 1, 1998. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1999. The Bulloch County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the Board. Tax millage rates levied for the 1998 tax year (calendar year) for the Bulloch County Board ofEducation were as follows (a mill equals $1 per thousand dollars of assessed value): School Operations School Bonds 9.4 mills -LQmills 10.4 mills SALES TAXES Local Option Sales Tax collected by the State and remitted to the Board during the fiscal year amounted to $6,875,457.41 and was recorded in the General Fund. Local Option Sales Tax is to be used for the maintenance and operation of the Board. -11 - BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS ruNE 30. 1999 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 of purchase. 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 Board issues general obligation bonds to provide funds for the acquisition and construction of major 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 of the government. The outstanding amount of these bonds is recorded in the General Long-Term Debt Account Group. INTERFUND TRANSACTIONS The Board has the following types ofinterfund transactions: Reimbursements of expenditures initially made from a fund that are properly applicable to another fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed. Operating transfers are recorded for all interfund transactions other than reimbursements. MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation ofthis data. DEFICIT FUND BALANCES The fund reporting a deficit fund balance position at June 30, 1999, is as follows: ( - 12- BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1999 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Fund Type/Fund Name Deficit Balance Governmental Fund Type Capital Projects Fund Georgia State Financing and Investment Commission $ 1,169.333.00 In the subsequent period, the Board anticipates using Bond Proceeds to eliminate this deficit. Note 2: DEPOSITS AND INVESTMENTS COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate of the face value of such surety bond and the market value ofsecurities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. OCGA Section 45-8-11(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 ofindebtedness or other direct obligations of the United States or of the State of Georgia, (4) Bonds, bills, notes, certificates ofindebtedness or other obligations ofthe counties or municipalities of the State of Georgia, (5) Bonds ofany public authority created by the laws ofthe 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 ofdevelopment authorities created by the laws of the State of Georgia, and -13 - BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 3Q. 1999 Note 2: DEPOSITS AND INVESTMENTS (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 At June 30, 1999, the bank balances were $10,249,783.13. The amounts of the total bank balances are classified into three categories of credit risk: Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name. Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board'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 Board's name.) The Board's deposits are classified by risk category at June 30, 1999, as follows: Risk Category Bank Balance 1 $ 103,824.08 2 10,145,959.05 3 0.00 Total $10.249.783.13 CATEGORIZATION OF INVESTMENTS Investments are classified as to risk by the three categories described below: Category 1 - Insured or registered, or securities held by the Board or the Board's agent in the Board's name. Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Board's name. Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Board's name. Funds invested in an investment.pool managed by another government are not required to be categorized unless the investing entity owns specific, identifiable investment securities in the pool. -14 - BULLOCH COUNTY BOARD OF EDUCATION EXHffiIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1999 Note 2: DEPOSITS AND INVESTMENTS At June 30, 1999, the carrying value ofthe Board's total investments was $3,685,590.17. The investments are classified as to risk categories as follows: TyPe of Investment U. S. Government Local Government Investment Pools Total Investments Risk Categories 2 $ 859.155.40 $ 0.00 $ Carrying Fair 3 Amount Value 0.00 $ 859,155.40 $ 859,155.40 2,826.434.77 2,826.434.77 $ 3,685.590.17 $ 3,685.590. I7 The carrying amounts shown above includes amounts maintained in an investment pool by the State of Georgia, Office of Treasury and Fiscal Services in which the Board owns no identifiable securities. The investment policy ofthe State ofGeorgia, Office of Treasury and Fiscal Services for the Local Government Investment Pool (primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description of the Primary Liquidity Portfolio is as follows: The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm. rated money market funds. However, Georgia Fund 1 operates in a manner consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and is considered to be a 2a-7 like pool. The pool is not registered with the SEC as an investment company. The pool's primary objectives are safety ofcapital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and determines participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value of the shares. Participation in the pool is voluntary and deposits consist offunds from local governments; operating and trust funds of Georgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund. Investments in Georgia Fund 1 and Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. Fund 6 maintains a duration of approximately one year. The weighted average maturity for Georgia Fund 1 on June 30, 1999 was 27 days. The average investment duration for Fund 6 on June 30, 1999 was 1.03 years. - 15 - BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 3D. 1999 Note 3: NON-MONETARY TRANSACTIONS The Board receives food commodities from the United States Department ofAgriculture (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 Board is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation. The Board has obtained commercial insurance for risk ofloss associated with torts, assets, errors or omissions and job related illness or injuries to employees. The Board has neither significantly reduced coverage for , these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any ofthe past three years. The Board has elected to self-insure for all losses related to natural disaster. The Board has not experienced any losses related to this risk in the past three years. The Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the same fund that the employee's salary and benefits were paid. Claims are accounted for with expenditure and liability being reported when it is probable that a loss has occurred, and the amount ofthat loss can be reasonably estimated. Changes in the unemployment compensation claims liability during the last two fiscal years are as follows: 1998 1999 Beginning ofYear Liability Claims and Changes in Estimates $ 0.00 $ 1.821,00 $ $ 0.00 $ 9.425.00 $ Claims Paid End ofYear Liability 1,821,00 $ 0.00 9.425.00 $ 0.00 The Board has purchased surety bonds to provide additional insurance coverage as follows: Position Covered Amount Superintendent Each Principal ChiefFinancial Officer $ 20,000.00 $ 20,000.00 $ 20,000.00 - 16- BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1999 Note 5: GENERAL LONG-TERM DEBT CAPITAL LEASES The Bulloch County Board ofEducation has entered into various lease agreements as lessee for computers, These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their incepti~n, GENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows: Purpose General Government - Series 1996 General Government - Series 1997 Interest Rates 4.70% - 6.00% 4.80% - 7.00% Amount $ 8,915,000.00 9,470,000.00 $18,385,000.00 The changes in General Long-Tenn Debt during the fiscal year ended June 30, 1999, were as follows: Capital Leases General Obligation Bonds Total Balance July 1, 1998 $ 87,128.17 $19,000,000.00 $19,087,128.17 Deductions Debt Retired 87,128,17 615,000,00 702,128.17 Balance June 30, 1999 $ O.GD $18,385,000,00 $j8.385,OOO.OD At June 30, 1999, payments due by fiscal year which includes principal and interest for these items are as follows: Fiscal Year Ended June 30 2000 2001 2002 2003 2004 2005 -2009 2010 - 2014 2015 - 2019 Total Principal and Interest General Obligation Bonds $ 1,625,590.00 1,613,890.00 1,600,240.00 1,593,240.00 1,589,140.00 7,922,445.00 8,039,972.50 4,914,862.50 $28,899.380,00 - 17- BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT liD" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS ruNE 30. 1999 Note 6: ON-BEHALF PAYMENTS The Board has recognized revenues and expenditures in the amount of$768,539.06 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies. Georgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance of Non-Certified Personnel In the amount of $602,734.49 Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $28,232.57 Office ofTreasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of$137,572.00 Note 7: SIGNIFICANT COMMITMENTS The following is an analysis ofsignificant outstanding construction or renovation contracts executed by the Board as of June 30, 1999, together with funding available: Project Unearned Executed Contracts Funding Available From State Nevils Elementary Renovations 95/96-616-007 ')7/97S-616-056 98/97S-616-058 98/97S-616-059 $ 195,895.00 3,660.59 513,766.85 538,563.24 609.136,12 $ 253,331.00 336,613.08 242,757.00 307.492.20 $ 1.861.021.80 $J.140e193.28 The amounts described in this note are not reflected in the general purpose financial statements. 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 Board believes that such disallowances, if any, will be immaterial to its overall financial position. - 18- BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1999 Note 8: CONTINGENT LIABILITIES The Board is a defendant in various legal proceedings pertaining to matters incidental to the perfonnance of routine Board operations. The ultimate disposition of these proceedings is not presently detenninable, but is not believed to be material to the general pUIpose financial statements. Note 9: RETIREMENT PLANS TEACHERS RETIREMENT-8YSTEM OF GEORGIA (TRS) TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement 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 Board who are covered by TRS are required by State statute to contribute 5% oftheir gross earnings to TRS. The Board 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 11.95% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows: Fiscal Year Percentage Contributed Required Contribution 1999 1998 1997 100% 100% 100% $ 3,576,300.41 $ 3,186,212.88 $ 2,879,247.51 - 19- BULLOCH COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 1999 ASSETS Cash and Cash Equivalents Investments Accounts Receivable Inventories Food Donated Commodities Purchased Food SCHOOL FOOD SERVICES FUND $ 439,027.20 LOTTERY PROGRAMS 345,545.03 $ 179,702.15 82,747.01 15,309.63 Total Assets $ 882,628.87 $ 1.79;;.:.,7.0.2.;,;,.1.5.. LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Total Liabilities FUND EQUITY Fund Balances Reserved For Continuation of Federal Programs For Continuation of State Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated Total Fund Equity Total Liabilities and Fund Equity $ 175,860.53 $ 28,973.60 348.07 173,958.99 3,493.55 $ 202,932.59 $ 179,702.15 $ 82,747.01 15,309.63 581,639.64 $ 0.00 $ 679,696.28 $ 0.00 $ 882,628.87 $ 1.79.;",;,;,7.0.2.';,;,1.5.. See notes to the general purpose financial statements. -20 - EXHIBIT "E" FEDERAL PROGRAMS OTHER PROGRAMS TOTALS JUNE 30, 1999 JUNE 30, 1998 $ 8,368.23 $ 447,395.43 $ 169,584.70 350,000.00 $ 1,293,340.67 7,514.64 1,826,102.49 566,262.84 82,747.01 15,309.63 96,539.38 17,582.96 $ 1,293,340.67 $ 15,882.87 $ 2,371,554.56 $ 1,199,969.88 $ 1,069,805.81 43,472.16 $ 176,111.87 $ 1,289,389.84 $ $ 242.13 242.13 $ 1,245,666.34 $ 73,035.96 350,070.86 3,493.55 1,672,266.71 $ 62,075.39 72,894.06 358,031.03 2,264.17 495,264.65 $ 3,950.83 $ 3,950.83 $ $ 15,640.74 15,640.74 630.89 82,747.01 15,309.63 96,539.38 17,582.96 0.00 0.00 581,639.64 589,952.00 $ 3,950.83 $ 15,640.74 $ 699,287.85 $ 704,705.23 $ 1,293,340.67 $ 15,882.87 $ 2,371,554.56 $ 1,199,969.88 - 21 - BULLOCH COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES SPECIAL REVENUE FUND YEAR ENDED JUNE 30,1999 REVENUES State Funds Federal Funds 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 Central Support Services Other Support Services Food Services Operation Debt Service Principal Interest 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 $ 232,188.00 $ 2,068,331.37 1,024,644,90 $ 3,325,164.27 $ 372,286.48 372,286.48 $ 346,515.34 378,99 10,319,13 $ 3,333,476,63 15,073,02 $ 3,333,476.63 $ $ -8,312.36 $ 372,286,48 0.00 $ -8,312.36 $ 704,074.34 -13,792,37 2,273,33 $ 679,696,28 $ 0,00 0,00 ....0....0..0.. See notes to the general purpose financial statements. -22 - EXHIBIT"F" FEDERAL PROGRAMS OTHER PROGRAMS TOTALS YEAR ENDED JUNE 30,1999 JUNE 30,1998 $ $ 2,261,625.91 $ 2,261,625.91 $ 183,421.69 $ 787,896.17 $ 4,329,957.28 1,024,644.90 728,488.39 4,134,468.97 969,495.99 183,421.69 $ 6,142,498.35 $ 5,832,453.35 $ 1,759,821.13 $ 227,007.13 73,884.55 55,463.28 86,489.59 878.40 59,156.99 $ 2,262,701.07 $ $ -1,075.16 $ 94,795.34 $ 2,201,131.81 $ 1,812,369.86 55,882.81 7,032.03 10,070.77 282,889.94 81,295.57 55,463.28 96,808.72 878.40 84,300.78 3,333,476.63 282,068.97 68,281.50 47,204.43 100,509.97 15,372.51 16,280.51 746.33 999.92 68,359.37 3,363,955.59 334,749.75 17,538.81 167,780.95 $ 6,136,245.13 $ 6,128,437.52 15,640.74 $ 6,253.22 $ -295,984.17 4,395.10 4,395.10 157,130.77 $ 3,319.94 $ 15,640.74 $ 10,648.32 $ -138,853.40 630.89 0.00 704,705.23 822,942.39 -13,792.37 -2,273.33 12,603.53 8,012.71 $ 3,950.83 $ 15,640.74 $ 699,287.85 $ 704,705.23 - 23- ASSETS Cash and Cash Equivalents Investments Accounts Receivable Total Assets BULLOCH COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30, 1999 EXHIBIT"G" REGULAR BOND PROCEEDS GEORGIA STATE FINANCING AND INVESTMENT COMMISSION TOTALS JUNE 30,1999 JUNE 30,1998 $ 1,991,160,96 $ 4,758.676,68 $ 6,749,837.64 $ 14,237,551.27 1,866.600.00 $ 1,655,125.94 1,655,125.94 3,486,332.19 $ 1,991,160.96 $ 4,758,676.68 $ 1,655,125.94 $ 8,404,963.58 $ 19,590,483.46 See notes to the general purpose financial statements. -24- See notes to the general purpose financial statements. -25- BULLOCH COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30,1999 SCHEDULE "1" FUNDING AGENCY PROGRAM/GRANT CFDA NUMBER Agriculture, U. S, Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1999 Grant National School Lunch Program 1999 Grant 10.553 10,555 Total Child Nutrition Cluster Other Programs Pass-Through From Georgia Department of Education Food and Nutrition Program Food Distribution Program (1) Pass-Through From Office of School Readiness Food and Nutrition Program Child and Adult Care Food Program 1999 Contract 10,550 10,558 Total U, S, Department of Agriculture Education, U, S, Department of Special Education Cluster Pass-Through From Georgia Department of Education Individuals with Disabilities Education Act Part B - Special Education Flow Through 1999 Grant Preschool 1999 Grant Special Education Capacity Building Improvement Grant 1999 Grant 84,027 84,173 84,173 Total Special Education Cluster Other Programs Pass-Through From First District Regional Educational Service Agency d/b/a Uve Oak Migrant Education Agency Elementary and Secondary Education Act TItle I Migrant Education 1998 Grant 1999 Grant Pass-Through From Georgia Department of Education Elementary and Secondary Education Act TItle I Grants to Local Educational Agencies 1999 Grant TItleJl Eisenhower Professional Development 1998 Grant 1999 Grant TItle '" Technology Literacy Challenge Fund Grants 1999 Grant TrtleVI Innovative Education Program Strategies 1999 Grant TItle X Twenty-First century Community Learning centers 1999 Grant 84,011 84.011 * 84.010 84.281 84.281 84,318 84.298 84.287 PASSTHROUGH ENTITY 10 NUMBER NlA $ NlA $ NlA NlA $ NlA $ NlA NlA $ NlA NlA NlA NlA NlA NlA NlA NlA FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD 450,879.16 1,326,385.37 $ 1,777,264,53 $ (2) 3,061,503,81 (3) 3,061,503,81 228,628,67 228,628,67 62,438,17 2,068,331,37 $ 43,344,15 3,333,476,63 469,685.78 $ 56,338.59 14,020.84 540,045,21 $ 469,717,09 (3) 56,338,59 14,020.84 540,076,52 2,706,80 10,766,11 2,710,80 (3) 10,766.11 1,407,458.78 27,894.97 109,447.49 54,319,00. 10,272,12 1,407,867,74 (3) 4,581.72 (3) 23,944.14 109,447,49 54,319,00 10,272,12 -26- BULLOCH COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30.1999 SCHEDULE "1" FUNDING AGENCY PROGRAM/GRANT Education, U. S. Department of Other Programs Pass-Through From Georgia Department of Education Vocational Education - Basic Grants to States High School Program Basic Grant 1999 Grant Tech-Prep Education 1999 Grant Total U. S. Department of Education Justice. U. S. Department of Pass-Through From Children and Youth Coordinating Council Juvenile Justice Delinquency Prevention and Treatment 98J-Q9-9804-0004 Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program CFDA NUMBER PASSTHROUGH ENTITY ID NUMBER FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD 84.048 84.243 N1A $ N1A $ 86.715.43 $ 12,000.00 2,261,625.91 $ 86,715.43 12,000.00 2,262,701.07 16.540 N1A $ 11.737.24 $ 1,:.;1:.1,;,7;,.::3;;.,7.=24-"- $ 87.479.72 $ _ _...;8::.,:7..!...4:.:.7..:;9.;;.,72=- Total Federal Financial Assistance $ 4,429,174.24 $ _ .....5...:;;,6.9.5;,:;;..39..4..6.6.. NlA = Not Available Notes to the Schedule of Exoenditures 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 1999 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 r) in front of the CFDA number. The Board did not provide Federal Assistance to any Subrecipienl The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Bulloch 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. -27- BULLOCH COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1999 SCHEDULE? AGENCY/FUNDING GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Program Special Instructional Assistance In-School Suspension Counselors Grades 4 and 5 Technology Specialist Local Fair Share Deferred Summer Salaries (Prior Year) Deferred Summer Salaries (Current Year) Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Alternative Program Apprenticeship Program At-Risk Summer School Program Environmental Science Program Health Insurance Innovative Programs Mentor Teacher Program National Teacher certifICation Grant Preschool Handicapped Program Remedial Summer School Program Student Record Teachers' Retirement Lottery Programs Assistive Technology Computers in the Classroom Georgia State Financing and Investment Commission Reimbursement on Construction Projects Office of School Readiness Pre-Kindergarten Program Office of Treasury and Fiscal services Public School Employees Retirement CONTRACTS Children's Trust Fund Commission School Linked Health Services Education, Georgia Department of Reading Challenge Reading First Human Resources, Georgia Department of Family Connection GOVERNMENTAL FUND TYPES SPECIAL CAPITAL GENERAL REVENUE PROJECTS FUND FUND FUND TOTAL $ 19,076,040,00 3,870,618,00 718,057,00 815,047,00 220,131,00 4,942,623,00 1,144,393,00 345,616.00 504,112,00 862,371,00 275,134,00 80,221,00 115,370.00 -4,310,729,00 -3,944,350,00 4,200,875,00 1,634,919.00 $ n,641.58 96,400.00 69,664.58 32,121.85 1,500.00 602,734,49 5,000.00 6,156.00 2,386.00 100,730.88 9,248.43 6,301.50 28,232.57 232,188.00 13,154,15 166,548,00 $ 19,076,040,00 3,870,618,00 718,057,00 815,047,00 220,131,00 4,942,623,00 1,144,393,00 345,616,00 504,112,00 862,371,00 275,134,00 80,221,00 115,370,00 -4,310,729.00 -3,944,350,00 4,200,875,00 1,634,919.00 232,188,00 n,641.58 96,400.00 69,664.58 32,121.85 1,500.00 602,734.49 5,000.00 6,156.00 2,386,00 100,730.88 9,248.43 6,301.50 28,232.57 13,154.15 166,548,00 137,572.00 $ 8,211,654.22 192,584.33 8,211,654.22 192,584.33 137,572.00 62,400.00 22,500.00 76,529.87 84,391,82 22,500.00 62,400.00 76,529.87 84,391,82 See notes to the general purpose financial statements, $ 31,788,537.88 $ 787,896.17 $ 8,211,654.22 $ 40,788,088,27 -28- BULLOCH COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS YEAR ENDED JUNE 30,1999 SCHEDULE "3" EXPENDITURES ASSISTIVE TECHNOLOGY COMPUTERS IN THE CLASSROOM PRE-KINDERGARTEN PROGRAM Current Instruction $ Support Services Improvement of Instructional Services General Administration Other Support Services 13,154,15 $ 166,548,00 $ 166,813.19 $ 378.99 10,319.13 15,073,02 TOTAL 346,515.34 378,99 10,319.13 15,073.02 Total Expenditures $ 13,154,15 $ 166,548.00 $ 192,584,33 $ 372,286,48 RECAP: Salaries and Benefits Pre-Kindergarten Program Other Expenditures Assistive Technology Computers in the Classroom Pre-Kindergarten Program $ 160,267,34 13,154,15 166,548.00 32,316.99 $ 372,286.48 See notes to the general purpose financial statements. -29- BULLOCH COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1999 SCHEDULE "4" Minimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis Salaries (1) (2) Operations Less: Expenditures for Media Center Programs in Excess of Total Media Allotment Expenditures per Audit. FOURTEEN WEIGHTED AND MEDIA CENTER PROGRAMS 100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS $ 24,479,762.00 $ _ _...:.:72:.:.7..1-:,7..:;5=2.:.:;.00.:. $ 26,104,579.03 2,265,574.07 $ _ _1.:..t,:.;97:.:.7.!.:,9:.::9.:,:8.:.::;88:. $ 28,370,153.10 -477,752.80 $ _--=2~7l..=,8.=.:92::;,l",4.:.;:0:.:;.0:.::;;.3.::..0 Amount of Underexpenditure for Total Allotment $ 0.00 $=====O=.O~O Note: (1) Salary accruals (July and August 1999 Deferred Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines. (2) Salary accruals (July and August 1998 Deferred Salaries) reported as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines. See notes to the general purpose financial statements. - 31 - BULLOCH COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30.1999 SCHEDULE "4" EDUCATION TOTAL REQUIRED ACTUAL EXPENDITURES SALARIES (1)(2) OPERATIONS TOTAL AMOUNT OF UNDEREXPENDITURE FOR REQUIRED ALLOTMENT $ 1,864,995.30 $ 1,882,852.83 $ 161,838.03 $ 2,044,690.86 4,788,333.00 5,515,241.95 457,153.90 5,972,395.85 $ 6,653,328.30 $ 7,398,094.78 $ 618,991.93 $ 8,017,086.71 $ 0.00 2,151,288.90 2,943,769.69 291,767.00 3,235,536.69 0.00 3,854,928.60 4,292,805.50 387,740.44 4,680,545.94 0.00 2,141,649.90 3,059,877.13 441,673.86 3,501,550.99 0.00 1,354,671.00 1,560,049.97 23,434.31 1,583,484.28 0.00 1,012,569.30 1,133,815.80 124,971.28 1,258,787.08 0.00 $ 17,168,436.00 $ 20,388,412.87 $ 1,888,578.82 $ 22,276,991.69 $ 3,216,523.50 $ 105,458.24 $ 746,111.84 2,573,908.13 143,692.50 141.70 $ 3,140.51 57,291.96 2,846.00 105,599.94 749,252.35 2,631,200.09 146,538.50 $ 3,216,523.50 $ 3,569,170.71 $ 63,420.17 $ 3,632,590.88 0.00 267,032.70 365,025.10 25,999.89 391,024.99 0.00 $ 3,483,556.20 $ 3,934,195.81 $ 89,420.06 $ 4,023,615.87 $ 646,251.30 $ 776,745.74 $ 0.00 $ 776,745.74 0.00 $ 21,298,243.50 $ 25,099,354.42 $ 1,977,998.88 $ 27,077,353.30 $ 588,029.40 $ 1,005,224.61 S 1,005,224.61 0.00 161,681.00 $ 287,575.19 287,575.19 0.00 $ 749,710.40 $ 1,005,224.61 $ 287,575.19 $ 1,292,799.80 $ 22,047,953.90 $ 26,104,579.03 $ 2.265,574.07 $ 28,370,153.10 S 0.00 $ 69,423.00 150,708.00 $ _...220--.,1.-3.1..,0.0. $ 259,515.33 $ 259,515.33 64,704.79 .64,704.79 $ 324,220.12 $ 324,220.12 $ ....0.;;;;..00. 33 SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS RUSSELL W. HINTON STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 April 13, 2000 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members ofthe Bulloch County Board of Education REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the financial statements ofBulloch County Board of Education as of and for the year ended June 30, 1999, and have issued our report thereon dated April 13, 2000. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditin~ Standards, issued by the Comptroller General of the United States. Compliance As part of obtaining reasonable assurance about whether Bulloch County Board of Education's financial statements are free ofmaterial misstatement, we perfonned tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the detennination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditin~ Standards. Internal Control Over Financial Re.portin~ In planning and performing our audit, we considered Bulloch County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control over financial reporting. However, we noted certain matters involving the internal control over financial reporting and its 99YB-40 operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in our judgement, could adversely affect Bulloch County Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. Reportable conditions are described in the accompanying Schedule of Findings and Questioned Costs as items FS-6161-99-01 and FS-6161-99-02. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occUr and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration ofthe 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, all ofthe reportable conditions noted above are also considered to be material weaknesses. This report is intended solely for the information and use ofmanagement, members of the Bulloch County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties. Respectfully submitted, ~u\.-4-,* Russell W. Hinton State Auditor RWH:jb 99YB-40 RUSSELL W. HINTON STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 April 13, 2000 Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members of the State Board of Education and Superintendent and Members of the Bulloch County Board of Education REPORT ON COMPLIANCE WITH REQUIREMENTS APPUCABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULARA-133 Ladies and Gentlemen: Compliance We have audited the compliance of Bulloch County Board of Education with the types of compliance requirements described in the U.S. Office o/Management and Budget (OMB) Circular A-I33 Compliance Supplement that are applicable to its major Federal program for the year ended June 30, 1999. Bulloch County Board ofEducation's major Federal program is identified in the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to its major Federal program is the responsibility of Bulloch County Board of Education's management. Our responsibility is to express an opinion on Bulloch County Board ofEducation's compliance based on our audit. We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits o/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 of compliance requirements referred to above that could have a direct and material effect on a major Federal program a occurred. An audit includes examining, on test basis, evidence about the Bulloch 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 Bulloch County Board ofEducation'S compliance with those requirements. 99SA-65 As described in items FA-6161-99-01 and FA-6161-99-02 in the accompanying Schedule ofFindings and Questioned Costs, Bulloch County Board of Education did not comply with requirements regarding Allowable Costs/Cost Principles and Equipment and Real Property Management that are applicable to its Elementary and Secondary Education Act - Title I Grants to Local Educational Agencies Program. Compliance with such requirements is necessary, in our opinion, for Bulloch County Board of Education to comply with requirements applicable to that program. In our opinion, except for the noncompliance described in the preceding paragraph, the Bulloch County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to its major Federal program for the year ended June 30, 1999. Internal Control Over Compliance The management of Bulloch 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 perfonning our audit, we considered Bulloch 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 p111J}ose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-l33. We noted certain matters involving the internal control over compliance and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over compliance that, in our judgement, could adversely affect the Bulloch County Board of Education's ability to administer a major Federal program in accordance with applicable requirements of laws, regulations, contracts and grants. Reportable conditions are described in the accompanying Schedule ofFindings and Questioned Costs as items FA-6161-99-01 and FA-6161-99-02.. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level ofrisk that noncompliance with applicable requirements oflaws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be reportable conditions and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, all of the reportable conditions noted above are also considered to be material weaknesses. 99SA-65 This report is intended solely for the infonnation and use ofmanagement, members ofthe Bulloch County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties. . Respectfully submitted, ~W.