E,A ' . IA. '2,oo -: . ,"'R ~ .. 1~ .E"~\.., 1',9 "?. ;ioo1-;z~ ! r ' 1 ' ::.'' r . \ '' ' ' . , ' ? \ ,, . r ', ' -' . ; ,, ' ,- .-- 1, " ' ' - ..... " t " .,, . , -. ' J - ,:au'LLOCH COUNTY BOARD OF.EDUCATION - -- ', .:STATESBORO, GEORGIA - ' ' ,, - '. ' , ' ,' ' .:' -. REPO RfO N ' AUDiT , ,_ OF THE FINANCIAL STATEMENTS ' ., ... ...... > ,; , ' . - . ''. ,FOR THE FISCAL YE.(R ENDED JUNE30, 2002 . ~, ,- .., -~ 1>_ ',, ' , -, - '. . ' ' -' C ''' ' -1 ." Ru~'s~n W. Hinton 'State A u d-i t'o r - ,, I ' ' '' -- , -, l ' 1-...,...;_..__..;J._( __.> _;..,.,-,-,- . , - - - - - - - - - - - - - - - - - - , - - - - - . ; . .____l_~ _...,____J . ' '. , :-' ; l ,, BULLOCH COUNTY ROARD OF EDUCATION - TABLE OF CONTENTS - SECTION I FINANCIAL INDLPENDcNT AUDITOR'S COMBINED REPORT ON GENcRAL-PURPOSE FINANCIAL STATEMtNTS AND SUPPLl:oMENTARY INFORMATION SCHEDULE OF EXPENDJTIJRES OF FEDERAL AWARDS EXHIBITS GENERAL-PURPOSE fINANCIAL ST,\TEMENTS COMBINED STATEMENTS - OVERVIEW A COMBINED BALANCE SHEf.T ALL FUND TYPES AND ACCOUNT GROUP 2 B COMBINED STATEMENT OF REVENUES. E.XPENDITUR[S AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES 4 C COMHINED STATEMENT OF RfVFNUES. EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE TTJNDS 6 D NOTES TO THI: GENERAL-PURPOSE FINANCIAL S'l ATEMENTS 7 ADDITIONAL FINANCIAL INI ORMATION COMBINING STATEMENTS SPECIAL REVENUE FUND E COMRINING HALANCE SHEET 18 r or COMBINING STATEMENT R[VENUES. EXPENDITURLS AND CHANGl:oS IN FUND BALANCES 20 CAPITAL PROJf:CTS FU~D G COMBINING RALANCE SHEET 22 H or COMBINING STATEMENT REYl:oNUES. EXPENDITURES AND CHANGl:oS IN FUND BALANCES 23 SCHEDULES or SCHEDUL~- OF EXPI,NDITCRES FEDERAL AWARDS 24 2 SCHEDULE OF STATE REVENUE 27 ALLO'l MENTS AND EXPloNDITURLS GENERAL FUND -QUALITY BASIC EDUCATION PROGRAMS (QBE) 3 BY PROGRAM 28 4 BY SITE 29 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 STAT[MENTS PERFORMED IN ACCORDANCE wml GOVERNMENT AUDITING STANDARDS REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133 SECl ION Ill AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS SECTION IV rINONGS AND QUhSTIONED COS IS SCHEDULE OF FINDINGS AND QUESTIONED COSTS SECTION I l'INANCIAL .','.\$";. I I 1 h,si LI W. Hl'llON '-,IAJI:: N.JDllOH DEPARTMENT OF AUDITS ANO ACCOUNTS 2"4 WJ..,hington Street ~ \V ~l11lc 214 AtlJntJ, Gcorg1,1 3(fl14-841X) June 4, 2003 Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Bulloch 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 Bulloch County Board of Education, as of and for the year ended June 30, 2002, as listed in the table of contents These general-purpose financial statements arc the respons1b1hty of the Bulloch County Board of F-.,ducallon's management Our respons1b1hty 1s to express an opinion on these general-purpose financial statements based on our audit We conducted our audit in accordance with auditing standards generally accepted in the United States of Amcnca and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the Umted States Those standards reqmre that we plan and perform the audit to obtain reasonable assurance about whether the financial statements arc free of matenal 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 s1gm ficant csllm.ites made by management, as well as evaluating the overall financial statement prescntat10n We believe that our audit provides a reasonable basis for our opinion As dcscnbed in the notes to the general-purpose financial statements, the Board of Education's financial statements have been prepared using certain accounting practices and pohc1es which, in our opinion, vary in some respects from generally accepted accounting pnnc1plcs These variances arc desenhcd as follows 2002ARL-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 eqmpmcnt owned by the Board of Educal!on which should be included to conform lo generally accepted accounting pnnc1plcs * School ac1Iv1ty accounts mamtaincd at the ind1v1dual schools are not included m the general-purpose financial statements To conform to generally accepted accounting pnnc1ples. these accounts should be included in the general-purpose financial statements The aggregate effects on the general-purpose financial statements of these vanances or om1ss1ons have not been determined, but are beheved to be material In our opm1on, 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 matenal respects, the financial pos1t1on of the Bulloch County Board of Educat10n as ofJune 30, 2002, and the results of its operations for the year then ended, in conformity with accounting pnnc1ples generally accepted in the Umted States of Arnenca In accordance with Government Auditing Standards, we have also issued our report dated June 4, 2003, on our cons1derat10n of the Bulloch County Board of Educat10n's internal control over financial reporting and our tests of its comphance with certain prov1s1ons of laws, regulat1ons, contracts and grants That report 1s an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conJunct1on with this report in cons1denng the results of our audit Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Bulloch County Board of Educat10n taken as a whole. The accompanying combmmg statements (Exh1b1ts E through H) and the financial schedules (Schedules I through 4). which includes the Schedule of Expenditures of Federal Awards as reqmred by U S. Office of Management and Budget Circular A-133, Audzts of States, Local Governments, and Non-Profit Orga111zatwns, are presented for purposes of add11Ional analysis and are not a required part of the general-purpose financial statements Such information has been subJected to the auditing procedures apphcd in the audit of the general-purpose financial statements and m our op1mon, except for the effects of the matters referred to in the third paragraph, such mformat10n 1s fairly stated, in all matenal respects, m relation to the general-purpose financial statements taken as a whole 2002ARL-13 A copy of this report has been filed as a permanent record m the office of the State Auditor and made available to the press ofthe State, as provided for by Offic1al Code ofGeor!,'la Annotated Section 506-24 Respectfully submitted, RWH gp 2002ARL-13 Hmton Sta e Auditor BULLOCH COUNTY ROARD OF EDUCATION BULLOCH COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 2002 ASSETS Cash and Cash Equivalents Investments Accounts Receivable Due from Other Funds lnventones Food Donated Commodities Purchased Food Amount Available m Debt Service Fund Amount to be Provided In Future Years For Payment or Bond Debt GENERAL FUND s 4 254,445 17 GOVERNMENTAL FUND TYPES SPECIAL CAPITAL REVENUE PROJECTS FUND FUND $ 675,355 26 1 402,262 07 7,079 586 94 $ 1,290,285 23 71,15896 35,389 32 Total Assets s s 12 135 294 18 11395 833 51 s_~6;;;7.:5-:3;;:;55;:.;26:;.:;:.. LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Reta1nages Payable Due to Other Funds Deferred Revenue General Obhga.Uon Bonds Payable Total l.Jabtllttes FUND EQUITY Fund Balances Reserved For Debt SeMce For lnvenlones Food Donated Commodities Purchased Food Unreserved Undeslgnated Deficit Total Fund Equity s $ 2,403 604 40 5 402 145 60 570,069 09 135 540 27 569 185 32 547 01 $ 7,805,750 00 $ 1,275,341 69 $ $ 4,930 544 18 71,15896 35,389 32 14,943 54 $ 675,355 26 $ 4 930,544 18 $ 121 491 82 $ 675,355 26 Total L1ab1hbes and Fund Equity s 12.136.294 15 s The notes to the general-purpose financial statements are an integral part of ttus statement -2- 1:3961833 51 s _ _~67:.5;;;,;;:;35;;;5:.2:;.:B:.. EXHIBIT "A" DEBT SERVICE FUND ACCOUNT GROUP GENERAL LONG-TERM DEBT TOTALS (Memorandum Only) JUNE 30 2002 JUNE 30 2001 s 550,35914 $ 5 480,159 57 $ 4,073,872 24 1,402 262 07 4 435,98912 55,285 57 8,425,157 74 8,023,120 26 2,177,820 83 s 605,644 71 15,769,355 29 71,15896 35,389 32 605,644 71 15 769 355 29 64 792 32 30 029 24 404,321 63 16 670 678 37 s 605 644 71 S 16 375 000 00 S 31 789 127 66 S 35,880 624 01 $ 570,069 09 $ 1 525 147 68 2,539 144 67 1 982 886 90 5,971,330 92 5,547,305 93 240,890 64 2 177,820 83 s 16 375,000 00 547 01 16,375,000 00 17 075 000 00 s s s 16,375 000 00 25 456 091 69 28 549 051 98 s 605,644 71 0 00 s 605 644 71 605,644 71 s 404 321 63 71 158 96 35,389 32 64,792 32 30,029 24 5 620,842 98 6,850,859 79 -18 430 95 s 6 333 035 97 s 7 331 572 03 605 644 71 $ 16 375 000 00 S 3178912766 S 35 880 624 01 - 3- BULLOCH COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30 2002 REVENUES State Funds Federal Funds Taxes Other Funds Total Revenues EXPENDITURES Current Instruction Support Servrces Puprl Services Improvement of Instructional Services Educattonal Media Services General Adm1mstrahon School Admlmstratron Business Adm1mstrabon Maintenance and Operation of Plant Student Transportation Services Central Support Servrces Other Support Servrces Food Servtees Operation Caprtal Ouliay Debt Servrce Pnncipal Interest Payrng Agent Fees Total Expenditures Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES (USES) Operating Transfers In Operating Transfers Out Total Other Frnanang Sources (Uses) Excess of Revenues and Other Flnanang Sources over (under) Expenditures and Other Fmanc1ng Uses FUND BALANCE JULY 1 Food Inventory - Net Change 1n Penod Donated Commodrt1es Purchased Food GENERAL FUND SPECIAL REVENUE FUND s $ 38,931,536 38 255,923 66 17,179,731 28 982 527 41 s $ 57 349 718 73 866,399 37 6,282,18641 1,038,267 50 8,186,853 28 s $ 39,920,822 73 2,097,659 78 880,329 83 1,414,47419 471,19418 4,035,839 50 261,220 44 4,659,343 48 3,088,643 62 590,588 20 157,987 61 3,431,487 59 462,272 90 214,760 02 31,17568 213.490 23 15,367 86 2,20868 110,417 05 203,277 50 3,730,303 41 s $ 57 578103 56 $ s -228 384 83 8,414,760 92 -227 907 64 $ $ -261 282 13 s s -261,282 13 s s -489,666 96 5,420,211 14 261,28213 261,28213 33,374 49 76,390 61 6,366 64 5 360 08 FUND BALANCE JUNE 30 s 4 930 544 18 S_ _,:.:12..:1.;4a:9.:.1~82:., The notes to the general-purfX)Se financial statements are an Integral part of this statement -4- EXHIBIT "B" CAPITAL PROJECTS FUND DEBT SERVICE FUND TOTALS (Memorandum Only) YEAR ENDED JUNE 30, 2002 JUNE 30, 2001 $ 39,797,935 75 $ 38,593,473 37 6,538,110 07 5,467,437 07 $ 1,805,793 18 18,985,524 46 18,164,869 27 s 4 731 82 390 32 2 025 917 05 241361167 s 4 731 82 $ 1,806, 183 50 $ 67 347.487 33 $ 64,639,391 38 s 43,352,310 32 $ 40,594,602 82 $ 760,025 21 2,559,932 68 1,095,089 85 1,445,649 87 684,684 41 4,051,207 36 261,220 44 4661,55216 3,199,060 67 590,588 20 361,265 11 3,730,303 41 760,025 21 2,317,430 04 1,111,272 02 1,429,617 08 561,086 37 3,945,415 64 291,478 33 4,256,223 61 2,957,098 63 600,134 56 330,876 16 3,661 840 87 2,987,472 15 $ 700,000 00 900,240 00 4 620 42 700,000 00 900,240 00 4 620 42 670,000 00 943,890 00 8 027 84 s 760 025 21 $ s 1 604 860 42 $ 68 357 750 11 66,666,466 12 s -755 293 39 $ 201,323 08 $ -101026278 $ -2 027 074 74 s s -755,293 39 1,430 648 65 $ s 261,28213 -261 282 13 s 0 00 s 38,451 47 -38.451 47 0 00 s 201,323 08 $ -1,010,262 78 -2,027,074 74 404,321 63 7,331 572 03 9,334,853 18 6 366 64 5 360 08 21,693 96 2 099 63 $ 675 355 26 $ 605 644 71 S 6,333 035 97 S 7 331 572 03 - 5- ,--------------------------~- BULLOCH COUNTY BOARD OF EDUCATION COMBINED STATEMENT OE REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUN PS YEAR ENDED JUNE 30 2002 EXHIBIT "C" GENERAL FUND BUDGET ACTUAL REVENUES State Funds Federal Funds Taxes Other Funds Total Revenues s 38,518 125 30 $ 38,931 536 38 86 233 13 255 923 66 17 491,345 00 17 179 731 28 725 000 00 882 527 41 $ 56 820 703 43 $ 57 349.718 73 EXPENDITURES Current lnstrucbon Support SeMCes Pupil Services Improvement of lnstructtona1 Services Educebonal Macha Service General Administration School Admrn1stretion Busrness Adm1n1strebon Marntenance and Operation of Plant Student Transportal.Jon Services Central Support SeMces Other Support Services Food Services Operation Capital Outlay Total Expenchtures Excess of Revenues over (under) Expendrtures s 40 417,832 06 $ 39 920 822 73 1 644 923 91 895 225 80 1,431,991 30 403 165 44 3 973,751 66 240,195 02 4 400 687 00 3 028 410 00 528,189 95 161 317 94 2,097 659 78 880 329 83 1 414 474 19 471194 18 4,035 839 50 261 220 44 4 659,343 48 3,088,643 62 590 588 20 15798761 423 600 84 s 57 549 290 92 $ 57 578 103 56 $ -728 587 49 $ -228 384 83 OTHER FINANCING SOURCES (USES) Other Sources Other USM Total Other Frnancrng Sources (Uses) $ 400,000 00 --400 000 00 $ $ 0 00 $ -26128213 -261 282 13 Excess of Revenues end Other Frnancrng Sources over (under) Expenditures and Other Financing Uses $ -728 587 49 s --489 666 96 FUND BALANCE JULY 1 2001 Adjustments Food Inventory - Net Change rn Penod Donated Commodities Purchased Food 4 987 665 63 182 00 5 420,211 14 FUND BALANCE JUNE 30 2002 S 4 259 270 14 $ 4 930 544 18 SPECIAL REVENUE FUND BUDGET ACTUAL $ 838 316 80 s 866 399 37 6 582 777 40 6282,18641 117025500 1 038 267 50 $ 8.591 349 20 $ 8 186.853 28 $ 3 383 177 44 $ 3 431,487 59 399 297 77 236 045 18 42,586 17 193,740 76 6 505 00 462,272 90 214 760 02 31 175 68 213 490 23 1536786 31 000 00 2 208 68 11041705 264 968 86 4 015,008 02 203 277 50 3 730 303 41 s $ 8 572 329 20 8 414 760 92 s 19 020 00 $ -227 907 64 s 26128213 $ 26128213 $ 19 020 00 s 11895508 33 374 49 76 390 61 6 366 64 5 360 08 $ -99 935 08 $ 121 491 82 The notes to the general-purpose financial statements are an integral part of this statemen -6 - BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TOTHF GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002 Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES REPORTING ENTITY The Bulloch County Board of Educat10n (School D1stnct) was estabhshed under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Supenntendent appomted by the Board The School D1stnct 1s organized as a separate legal entity and has the power to levy taxes and issue bonds Its budget 1s not subJect to approval by any other entity Accordmgly, the School D1stnct 1s a pnmary government and consists of all the organizations that compose its legal entity FUND ACCOUNTING The School D1stnct uses funds and an account group to report on 1ls financial pos1t1on and the results of1ts operallons Fund accountmg 1s designed to demonstrate legal comphance and to aid financial management by scgregatmg transactions related to certain governmental funct10ns or act1v11Ics A fund 1s a separate accountmg entity with a sclf-balancmg set of accounts An account group 1s a financial reporting device designed to provide accountab1hty for certain assets and hab1ht1es that arc not recorded in the funds because they do not directly affect expendable available financial resources General Fn,ed Assets arc recorded as expenditures in the vanous funds at the time of purchase A General Fixed Assets Account Group 1s not presently mamtamcd by the School D1stnct To conform to generally accepted accounting pnnc1ples, a General Frl(cd Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types Although "school acllv1ty accounts" arc maintamed at the md1v1dual schools, neither the assets, hab1h11es and fund eqmty, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements To conform to generally accepted accounting pnnc1ples, these accounts should be recorded m the general-purpose financial statements The general-purpose financial statements account for all State, Federal, Taxes and Other funds under control of the School D1stnct, m comphancc with generally accepted accountmg pnnc1ples apphcable to governmental umts, unless otherwise disclosed m these notes Funds and the account group presented in this report are as follows GOVERNMENTAL FUND TYPES - arc used to account for all or most of the School D1stnct's educational acllv1t1es Governmental Fund Types include GENERAL FUND - the fund used to account for all financial resources of the School D1stnct except those reqmred to be accounted form another fund These transacllons relate to resources obtained and used for services provided by a board of education -7- BULLOCH COUNTY BOARD OF EDUCAflON EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL Sl ATEMENTS JIJNE 30, 2002 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 rcstncted to expenditures for specified purposes These funds are received pnmanly from the Georgia Department of Educal!on and from the Federal government to accomplish specific educal!onal obJect1ves CAPITAL PROJECTS FUND- the fund used to account for financial resources to be used for the acqms1t1on or construction of maJor capital fac1ht1cs DEBT SERVICE FUND-the fund used to account for the accumulat10n ofresources for, and the payment of, general long-term pnnc,pal, interest and paying agent fees ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obhgat10n debt outstanding BASIS OF ACCOUNTING The accounting and financial reporting treatment apphed to a fund 1s 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 hab1h\les generally are included on the balance sheet Operating statements of these funds present increases (1 e , revenues and other financing sources) and decreases (1 e, expenditures and other financing uses) in net current assets Their reported fund balance 1s considered a measure of available spendable resources Liab1h1Ies which are expected to be financed from available spendable resources are reported as hab1hlles in the governmental funds Other hab1hhes, 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 usmg the modified accrual basis of accounting under which Revenues arc rccogmzed when susceptible to accrual (1 e , when they become both measurable and available) "Measurable" means the amount of the transact10n can be determined and "available" means collec!Jble within the current penod or soon enough thereafter to be used to pay hab1ht1cs of the current penod The School D1stnct considers receivables collected within sixty days after yearend to be available Property taxes, sales taxes and interest are considered to be suscepl!blc to accrual Nonexchange transactions, m which the School D1stncl gives (or receives) value wllhout directly receiving (or giving) equal value in exchange, include property taxes, local option sales laxes, intergovernmental grant~ and donations Revenue for property taxes 1s rccogmzed m the fiscal year for which the taxes are levied Revenue from sales taxes 1s rccognued in the fiscal year the resources are received or susceptible to accrual Revenue from grants and donations 1s recogmzed in the fiscal year in which all ehg1b1hty requirements have been satisfied -8- BULLOCH COUNfY BOARD OF EDUCATION EXHIBIT "D" NOTES TO TIIE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002 Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures are generally rccogmzed when the related fund hab1hty 1s incurred A substantial number of personnel of the School D1stnct were employed for a one hundred and ninety day penod bcginmng in August 200 I and ending in early June 2002 Employment contracts for these employment penods typically specify that compensation be paid rn twelve equal monthly payments begrnnmg m September 200 I and endmg in August 2002 State grants to fund the State's share of these contracts are disbursed to the School D1stnct in the same twelve month penod In accordance with generally accepted accountmg pnnc1ples, salary and funge benefit expenditures and the related revenue from the State to fund these contracts arc recorded in the fiscal pcnod covered by these financial statements BUDGET The Bulloch County Board of Educal!on's budget 1s a complete financial plan for the School D1stnct's fiscal year and 1s based upon estimates of expenditures together with probable fundrng sources There 1s no statutory proh1b1t1on regarding overexpendilure of the budget at any level The budget for all governmental funds 1s prepared by fund. funcl!on and obJect The legal level of budget control was estabhshed by the Board at the aggregate level The budget for governmental funds was prepared on a basis other than generally accepted accounl!ng prmc1plcs The budget process begins when the School D1stnct's adm1rustral!on prepares a tentanve budget for the Board's approval After approval ofth1s tental!ve budget by the Board, such budget 1s advertised at least once in a newspaper of general c1Tculat10n rn the locahty At the next regular meeting of the Board after advertisement, the Board receives comments on the tental!ve budget, makes rcv1s10ns as necessary and adopts a final school budget This final budget 1s then submitted, in accordance with prov1s10ns of the Quality Basic Educat10n Act, OCGA Sect10n 20-2-167(c), to the Georgia Department of Educat10n The Board may rncrease or decrease the budget at any l!me dunng the year All unexpended budget authonty lapses at fiscal year-end CASH AND CASH EQUIVALENTS COMPOSITION OF DEPOSITS Cash and cash eqmvalcnts consist ofcash on hand, demand deposits and short-term mvestments with onginal matunl!es of three months or less from the date of acqms11Ion m authonLed financial msl!tul!ons Georgia Laws OCGA 45-8-14 authonze the School D1stnct to deposit !Is funds in one or more solvent banks or insured Federal savmgs and loan assoc1at10ns INVESTMENTS COMPOSITION OF INVESTMENTS Investments made by the School D1stnct rn nonpart1c1patmg mtcrest-earning contracts (such as certificates ofdeposil) and repurchase agreements are reported at cost Part1c1pal!ng interest-earnrng contracts and money market investments with a matunty at purchase ofone year or less arc reported -9- BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002 Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES at amortized cost Both part1c1pating interest-eaming contracts and money market investments with a matunty at purchase greater than one year are reported at fa1r value. The Official Code of Georgia Annotated Section 36-83-4 authonzes the School D1stnct to mvest its funds and m selectmg among options for mvestment or among instltullonal bids for deposits, the highest rate of return shall be the obJccl1ve, given eqmvalcnt cond111ons of safety and hqmd11y Funds may be mvested m the followmg (1) Obhgahons issued by the State of Georgia or by other states, (2) Obhgat1ons issued by the Umted States government, (3) Obhgallons fully insured or guaranteed by the Umted States government or a Umted States government agency, (4) Obhgat1ons of any corporallon of the Umted States government, (5) Pnme banker's acceptances, (6) The Local Government Investment Pool adm1mstered by the State of Georgia. Office of Treasury and Fiscal Services, (7) Repurchase agreements, and (8) Obhgatlons of other poht1cal subd1v1s10ns of the State of Georgia RECEIVABLES Receivables consist of grnnl 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 recogmt10n cntena has been met Receivables recorded on the general-purpose financial statements do not mcludc any amounts which would ncccssllatc the need for an allowance for uncollect1ble receivables PROPERTY TAJ(ES 1 he Bulloch County Board ofComm1ss1oncrs fixed the property ta, levy for the 2001 tax digest year (calendar year) on November 20,200 I (levy date) Taxes weredueon February 18, 2002 (hen date) Taxes collected w1thm the current fiscal year or w1thm 60 days aIler year-end on the 2001 tax digest .ire reported as revenue m fiscal year 2002 The Bulloch County Tax Comm1ss1oncr bills and wllccts the property tm,cs for the School D1stnct, withholds 2 5% oftai.es collected as a fee for tax collection and remits the balance of taxes collected lo the School D1stncl Property tax revenues durmg the fiscal year ended June 30, 2002 for mamlcnance and opernl1ons amounted to S9, 128,867 62 and for school bonds amounted to $993,322 87 - 10 - BULLOCH COUNTY BOARD OF FDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2002 Note I SUMMARY OF SIGNfFICANT ACCOUNTING POLICIES Tax millage rates levied for the 2001 tax year (calendar year) for the Bulloch County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value) School Operations School Bonds 8 57 mills .....2.lm11ls 2,iam1lls SALES TAXES Local Option Sales Tax revenue dunng the fiscal year amounted to $7,75 I, 162 22 and was recorded m the General Fund Local Option Sales Tax 1s to be used for the mamtenance and operation of the School D1stnct INVENTORIES FOOD INVENTORIES lnventones of donated food commodities used m the preparation of meals are reported on the Combmed Balance Sheet at their Federally assigned value Purchased foods mventones are reported on the Combmed Balance Sheet at cost (first-m, first-out) Donated food commodities are recorded as revenues and expenditures at the time commodity items are received Purchased foods mventones are recorded as expenditures at the time of purchase The mventones reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which md1cates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets GENERAL OBLIGATION BONDS The School D1stnct issues general obhgat1on bonds to provide funds for the acqms1t1on and constructmn ofmaJor capital fac1ht1cs Bond premiums and discounts, as well as issuance costs, are recognized m the financial statements dunng the year bonds arc issued General obhgallon bonds are direct ohhgat1ons and pledge the full faith and credit ofthe government The outstandmg amount of these bonds 1s recorded m the General Long-Term Debt Account Group INTERFUND TRANSACTIONS The School D1stnct has the followmg types of mterfund transactions Reimbursements ofexpenditures 1mt1ally made from a fund that are properly applicable to another fund are recorded as expenditures m the rc1mbursmg fund and as reductions of expenditures m the fund that 1s reimbursed - II - BULLOCH COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GEJ\loRAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2002 Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Operating transfers are recorded for all mterfund transact10ns other than reimbursements MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the general-purpose financial statements arc captioned "Memorandum Only" to md1cate that they are presented only to fac1htate financial analysis Data m these columns do not present financial pos1t1on or results ofoperahons in confonmty wnh generally accepted accounting pnnc1ples Neither arc such data comparable to a consohdahon. Interfund ehminat10ns have not been made in the aggregallon of this data Note 2 DEPOSITS AND INVESTMENTS COLLATERALIZATION OF DEPOSITS Official Code of Georgia Armotatcd (OCGA) Secllon 45-8-12 provides that there shall not be on deposn at any lime many 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 ofthe face value of such surety bond and the market value of secunt1es pledged shall be equal to not less than 110 percent ofthe pub he funds bemg secured after the deduchon ofthe amount ofdeposit msurance If a depository elects the pooled method (OCGA 45-8-13 I) the aggregate ofthe market value of the secunties pledged to secure a pool ofpubhc funds shall be not less than 110 percent ofthe daily pool balance OCGA Section 45-8-11 (b) provides an officer holding pubhe funds may, in his d1scret10n, waive the requ1Tement for secunty in the case ofoperating funds placed m demand deposit checking accounts Acceptable secunty for deposits consists of any one of or any combination of the following (I) Surety bond signed by a surety company duly qualified and authonzed to transact business w1thm 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 obhgat10ns of the United States or of the State of Georgia, (4) Bonds, bills, notes, certificates of indebtedness or other obhgat10ns of the counties or mumc1paht1es of the State of Georgia, (5) Bonds of any pubhe authonty created by the laws of the State of Georgia, providing that the statute that created the authonty authonzed the use of the bonds for this purpose, (6) lndustnal revenue bonds and bonds of development authonlles created by the laws of the State of Georgia, and - 12 - HULLOCI I COlJN rv BOARD or EDUC Al ION EXHIBIT "D" NOTl:S IO I HC GCNl:RAL-PURPOSE FINA_NCIAL SrATl- MEN IS JUNE JO 2002 Note 2 DFPOSITS AND JNVLS rMENTS (7J Bonds, hill,. notes. cert1licate, of mdebtcdne,,. or other obhgatmns of a suh,1d1ary corporntlon of thc United State, go\'crnment. which are fully guaranteed hy the Unncd State, government hoth as to prmc1pal and mtcrcst or debt nbhgat1ons 1,,ued by the Federal Land Bank. the 1-cderal Home Loan 13ank, the Fc.!dcral lntern1ediate Credit Bank, the Central 13ank for Cooperative,. the Farm Credit Banl..s, thc Federal Home Loan Mortgage A,soc1at1on, and the federal National Mortgage Association CATEGORIZATION OF DEPOSI rs At June 30. 2002. the bank balance, were $6.873. 726 04 1 he amounts ofthe total hank balances arc da,s1lied mto three catcgoncs ol credit nsk Category I Ca,h that 1s m,ured (e g. Federnl depository insurance) or collaterahzed with secuntle, held by the School D1stnct or b) the School D1stnct's agent m the School D1,tnct', name Categor) 2 Cash eollaterahzed with secuntlc, held by the pkdgmg linanc1al mst1tut1on', trust department or agent m the School D1stnct\ name Catcgor~ 3 . Uncollateral1 cd deposit, ( I his includes an) bank balance that 1s collaterahLcd \\Ith ,ccunt1e, held by the plcdgmg financial mst1tut1on, or b} 11, trust department or agent but not m the School Di,tnct', name J 1 he School D1stnct', deposits are da,,1fied by nsk category at June 30. 2002, as follows Risk Catcgorv Bank Balance $ 102,901 42 0 00 3 6,770,824 62 1 otal $_6.873.726:V,1 or l,\ T[GORll i\ I ION INVI Sl ~ENTS <\t June 30. 2002. the CdIT) mg \aluc of the School D1,tnct's total mw,tmcnt, \\as $1.402.262 07 which 1s materially the same a, lair value This 1me,tmcnt consisted entirely ol funds m\'cs1ed m the Local GO\ernmcnt lnn:,tmcnt Pool adm1m,tered by the State of Georgia. O11ice ofTrea,ury and Fiscal Sernce, which arc not reqmred to be categorized ,mce the School D1,tnct did not own any ,pcc1fic 1dent1fiahlc ,ccuntles m the pool The mvcstment pohcy of the State of Georgia. Office of 1 rea,ury and fiscal Service, tor the Local Government Investment Pool (Primary I 1qmd1ty Portfolio) docs not pronde for mvc,tment m dcnvdtnc, or ,,milar mve,tment, A dc,cnpt1on ofthe Pnmdr)' L1qu1d1ty Portfolw 1, as follow, I3 BULLOCII COUNl Y HOARD OF 1:DUCATIO"I fXHIBll "D" NO rFS TO THF GE~ERAL-PURPOSI: rlNANCIAI STA ITMENTS JUNE 30, 2002 Note 2 DEPOSrI S AND INVESTMENTS The Primary L1qu1d1ty Portfolio consists of Georgia Fund I. which 1s a comhinauon local and ,tatc government investment pool. and Fund 6 Georgm Fund I 1s a stable net asset value inwstment pool which follows Standard and Poor's cntena for AAAm rated money market funds The pool 1, not registered with the SI:(' a, an investment company but does operate Georgm Fund I in a manner consistent with Ruic 2a-7 of the Investment Company Act of 1940 and 1s considered to be a Rule 2a7 hke pool l'hc pool's pnmary obJccl!vc, arc safety of capital. investment income. hqu1d1ty and d1ver,1ticat1on while maintaining pnnc1pal ($1 00 per share value) Net asset value 1s calculated weekly to ensure stab1hty I he pool d1stnbutes earnings (net of management fees) on a monthly bds1, and values part1c1pant's shares sold and redeemed based on $ I 00 per share Pooled cash and cash equivalent, and investment, arc reported al cost which approximates fair value The pool doe, not 1,sue any legdlly binding guarantees to support the value of the shares Part1c1pat1on in the pool 1s voluntary and dcpo,11, consist of lund, lrom local government,, operating and trust funds of Georgia's state agencies. college, and umver,111e,. and current operating funds of the State of C,eorg1J\ General ~ und Investments in Georgia fund I and fund 6 are duected lo\,ard ,hort-term instruments such a, l' S f rca,ury ohhga11on,. seLunlles issued or guaranteed as to pnnc1pal and interest by the C S Go\emment or any of 11, agencies or in,trumentah11es. hanker's acceptance, and repurchase agreement, 1 he weighted average maturity of Georgia fund I ma} not e'l.cced 60 days The \\C1ghted average maturity tor Georgia rund I on June 30. 2002. was O 12 year, The average investment durauon for fund 6 on June 30. 2002. was O75 year, Note 3 NON-MONFI ARY l RANSAC I IONS I he ~chool D1stnct receives food commod111es from the Umtcd State, Department of Agriculture (lJ<;DA) tor sLhool breakfost and lunch programs These commod1ues are recorded at thcu I edcrally a1gned ,aluc See Note I - lmentorie~ Note' 4 RISK MANAGEMENT I h<: SLhool District 1, e'l.posed to vanous nsks of loss related lo tort,. theft of, damage lo, and destruction of aets. error, or om1"ions. Joh related ii Ines, or mJunes to employees. act, of C,od and unemployment compcm,auon I he ',chool D1stncl hd, obtained commercial insurance for n,k oflo,s associated with tort,. asseh, errors or om1ss10m,. 10b related illness or mJunc, to employees and earth movements caused hy sinkhole, (ac\s of God) I he School O1,tnct has neither s1gmficantly reduced coverage for the,e n,k, nor incurred losses (settlements) which exceeded the School D1,tnct', insurance coverage in Jny of the past three years - 14 - BULLOCH COUNTY DOARD OF EDUCATION CXHIBIT "D" NO I ES TO THE GENERAL-PURPOSE FINANCIAL STATIMENTS JUNE 30, 2002 Note 4 RISK MANAGEMENT The School D1stnct has elected to sclf-msure for all losses related to acts of God, except for earth movements caused by smkholcs The School D1stnct has not expenenced any losses related to these risks m the past three years The School D1stnct 1s sclf-msured with regard to unemployment compensallon claims The School D1stnct accounts for claims w1thm the same fund that the employee's salary and benefits were paid Claims arc accounted for with expenditure and hab1hty bcmg reported when 1t 1s probable that a loss has occurred, and the amount of that loss can be reasonably esllmated Changes m the unemployment compensation claims hab1hty durmg the last two fiscal years are as follows 2001 2002 Begmnmg of Year Lrnbthty Claims and Changes m Es11mates $ 93 28 s 1 496 28 $ $ I 071 00 $ 6 198 00 $ Claims Paid End of Year Lrnbthty 518 56 $ 1 098 00 $ 1 07 I 00 6 171 00 The School D1stnct has purchased a surety bond to provide add11Ional msurance e-0verage as follows Pos11ton Covered Amount Each Employee $ 50,000 00 Note 5 GENERAL LONG-TERM DEBT GENERAL OBLIGATION DEBT OUTSTANDING General Obhgallon Bonds currently outstandmg are as follows Purpose Interest Rates Amount General Government - Senes 1996 General Government - Senes 1997 4 70%-6 00% 4 80%- 7 00% S 7,940,000 00 8,435,000 00 SJ G. 175,0QlLlill The changes m General Long-Tern1 Debt durmg the fiscal year ended June 30, 2002, were as follows - 15 - BULLOCH COUNfY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002 Note 5 GENERAL LONG-TERM DEBT General Obligation Bonds Balance July 1, 2001 $17,075,000 00 Deducllons Debt Retired 700 000 00 Balance June 30, 2002 $ I 6,375.000 00 At June 30, 2002, payments due by fiscal year which mcludes pnnc1pal and mterest for these items are as follows Fiscal Year Ended June 30 General Obhgatmn Bonds 2003 2004 2005 2006 2007 2008 - 2012 2013 - 2017 S 1,593,240 00 1,589,140 00 1,582,640 00 1,578,950 00 1,583,325 00 7,982,340 00 8,150,025 00 Total Pnnc1pal and Interest $24,059,660,00 Note 6 ON-BEHALF PAYMENTS The School D1stnct has recognized revenues and expenditures m the amount of $773,445 66 for health msurance and retirement contnbutmns paid on the School D1stnct's behalf by the followmg State Agencies Georgia Department of Education Paid to the Georgia Department ofCommumty Health For Health Insurance of Non-Certified Personnel In the amount of $664,210 66 Office of 1 reasury and Fiscal Services Paid to the Pubhc School Employees Retirement System For Pubhc School Employees Rellrement (PSERS) Employer's Cost In the amount of$ I 09,235 00 - 16 - BULLOCH COUNTI' BOARD OF EDUCATION EXHIBIT "D" NOTCS TO 1 HE GE:KERAL-PURPOSE FINANCIAL STA1 EMf-,N IS JUNE 30. 2002 Note 7 CONTINGENT LIABILITIES Amounts received or receivable pnnc1pally from the Federal government are subject to audit and review by grantor agencies This could result m requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms The School D1stnct believes that such d1sallowances, 1f any, will be 1mmatenal to its overall financial position The School D1stnct 1s a defendant m vanous legal proeecdmgs pertammg to matters mc1dentaJ to the performance ofroutme School D1stnct operal!ons The ultimate d1spos1!Jon ofthese proceedmgs 1s not presently determmable, but 1s not believed to be matenal to the general-purpose financial statements Note 8 RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) TRS PLAN DESCRIPTION Substantially all teachers, admm1stra1Ive and clencal persormel employed by local school d1stncts are covered by the Teachers Rel!rement System of Georgia (TRS), which 1s a cost-shanng multiple employer defined benefit pension plan TRS provides service retirement, d1sab1hty retirement and survivors benefits for its members m accordance with State statute The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtamed from the Georgia Department of Audits and Accounts TRS CONTRIBUTIONS REQUfRED AND MADE Employees ofthe School D1stnct who are covered by TRS arc required by State statute to contnbute 5% ofthe1r gross eammgs to TRS The School D1stnct makes monthly employer contnbut10ns to TRS at rates adopted by the TRS Board of Trustees m accordance with State statute and as advised by their mdepenn Program Pnmary Grades (1-3) Program Pnmary Grades- Ear1y lnlervenlJon (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Earty lntervenbon (4-5) Program Middle School (IHI) Program High Sdlool General Education (9-12) Program VocatJonal Laboratory (9-12) Program Students with D1sabllrtres Category I CateQOl"Y It Catego,y Ill Category IV CotegoryV Gifted Student - Category VI Remedial Educabon Program Allemahve Education Program English Speakers of Other Languages (ESOL) 20 Days Add1UOnal Instruction Media Center Program Staff and Professlonal Developmcnl Indirect Cost Categoncal Grants Pupil Transportabon Regular Bus Replacemont Nursing 5cMces Pnncipal Supplements Vocabonal SupeMsors Deferred SurM"ICr Salaries (Pnor Year) Doferred Summer Sa\ancs (Current Yoar) Educal.Joo Equah:zaborl Funding Grant Food SeMCes Vocatlooal Education Other Stale Programs Health Insurance Mentor Teachers National Teacher Cerl.Jficaoon Outdoor Classrooms Post Secondary Opbons Presd'lool Handicapped Program StatE!Wlde After School (4-8) Progam Stat8W1do Reading (K-3) Program Lottery Programs ASSIStlV8 Tecivlology Computers in the Classroom Georgia Counol for the Arts Georgia Challenge Grant Office of School Readmess Pro-hlndergarton Program Office of Treasury ond Fiscal SeMCeS Public School Employees Retirement CONTRACT Human Resources Geor"3 Department of Farrwly Coonoctton GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 25,000 00 $ 25 000 00 1 795 888 00 608 452 00 4, 183,678 00 1 558 815 00 2,456 700 00 951,1TTOO 4 704 610 00 3 970,649 00 1.293 451 00 176,312 00 928 530 00 2 297 665 00 833 246 00 74 940 00 665 041 00 38 381 00 368,188 00 106 197 00 246 355 00 797 927 00 146 641 00 4 929,704 00 133847300 372 241 00 171 961 00 3543200 52 337 00 -4 890 005 58 4 805 336 00 2 255 214 00 $ 602 721 19 604 210 66 8 415 00 4 844 00 2 701 82 1128500 11431800 83 935 91 11593638 239 468 00 17 103 93 206 650 00 15 000 00 109 235 00 353 655 81 1 795 888 00 608,452 00 4 183,678 00 1 55881500 2,456,700 00 951,177 00 4,704 610 00 3 970 649 00 1,293 451 00 176 312 00 928 530 00 2,297 665 00 633,246 00 74 940 00 565 041 00 38,381 00 368 186 00 10619700 246 355 00 797,927 00 146 841 00 4 929 704 00 1338473 00 372 241 00 171,961 00 35 432 00 52 337 00 -4 890,005 58 4 805 336 00 2,255 214 00 239 468 00 602,72119 664 210 66 8 415 00 4 844 00 2,701 82 1128500 11431800 83 935 91 115,936 38 1710393 200 650 00 15 000 00 353 655 81 109 235 00 49 521 63 49 521 63 See notes lo the general-purpose finanaal statements s s 38 931 536 38 866 399 37 $ 39 797 935 75 - 27- BULLOCH COUNTY BOARD OF EDUCATION GENERAL FUND QUALITY BASIC EDUCATION PROGRAM jOBEI ALLQTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30 2002 SCHEDULE "3" DESCRIPTION ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1) ELIGIBLE QBE PROGRAM COSTS SALARIES OPERATIONS TOTAL Direct lnstrucbonal Programs Kmdergarten Program s Kindergarten Program--Earty Intervention Program Primary Grades (1-3) Program Pnmary Grades-Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades-Ear1y Intervention (4-5) Program Mrddle Grades (6-8) Program Mrddle School (6-8) Program High School General Educahon (9-12) Program Vocational Laboratory (9-12) Program Students with Dtsab1lrues Category I category II category Ill Category IV Gifted Student - Category VI Remedial Education Program Altemahve Education Program English Speakers of Other Languages (ESOL) 2,058,411 00 $ 697 395 00 4 795 246 00 1,786,684 00 2,812,434 00 1,926 379 54 $ 663,547 28 6,039,156 77 2 341 544 35 2 898 406 94 98,132 29 $ 23,892 26 310,336 70 60,940 32 198,062 52 202451183 687,439 54 6,349 493 47 2 402 484 67 3,096,469 46 1,093,602 00 5,392 327 00 4,551,305 00 1 482 528 00 4 940,826 00 647,639 00 43,992 00 422,007 00 121 721 00 1,13506609 484,374 44 5,445,000 63 5,902,878 75 1,513 066 90 59,329 51 700,159 87 3,659,429 61 418 397 60 607,802 29 105,079 98 580 657 08 42,751 35 43,327 77 73,341 78 460 081 10 476,439 66 167,923 29 505 60 3,636 11 62,573 23 3 516 85 20,162 64 15 936 68 33,336 06 1,178,393 86 557,716 22 5 905 081 73 6,379,318 41 1,680,990 19 59,835 11 703,795 98 3,722,002 84 421 914 45 627,964 93 105,079 98 596,593 76 7608741 TOTAL DIRECT INSTRUCTIONAL PROGRAMS $ 3084611700 $ 34,523,028 98 $ 2 052 144 86 $ 36,575 173 84 Media Center Program Staff and Proless1onal Development 914,568 00 168 306 00 1 197,305 00 126 443 84 185,734 63 145 526 21 1 383 039 63 271,970 05 TOTALOBEFORMULAFUNDS 31 928 991 00 $ 35 846 777 82 $ 2 383 405 70 $ 38,230 183 52 (1) Compnsed of State Funds plus Local Five Mill Share See notes to tho general-purpose financial statements 28 BULLOCH COUNTY BOARD OF EDUCATION GENERAL FUND QUALITY BASIC EDUCATION PROGRAM (QBE) ALLOTMENTS AND EXPENDITURES BY SITE YEAR ENDED JUNE 30, 2002 SCHEDULE "4" SITE Mill Creek Elementary School Wilham James Middle School Langston Chapel Elementary School Brooklet Elementary School Langston Chapel Middle School Southeast Bulloch Middle School Portal Elementary School Nevils Elementary School Bryant Elementary School Statesboro High School Sblson Elementary School Portal M1ddle/H1gh School Mattie Lively Elementary School Southeast Bulloch High School Sallie Zetterower Elementary School Bulloch County Educational Opporturnbes Program Central Office (Alternative Education Program) Other Aux1hary Facility TOTAL (1) Compnsed of State Funds plus Local Five Mill Share ALLOTMENTS FROM GEORGIA DEPAIRTMENT OF EDUCATION (1) ELIGIBLE QBE PROGRAM COSTS $ 2,312,962 00 $ 2,746,659 76 2,050,605 00 2,360,815 49 2,152,414 00 2,353,644 14 1,655,856 00 1,785,145 20 2,304,509 00 2.736,845 88 2,096,082 00 2,248,030 29 1,270,869 00 1,489,631 00 1,187,473 00 1,470,854 36 2,243,691 00 2,630,091 60 4,471,695 00 5,388,117 70 1,624,773 00 1,957,096 05 1,432,500 00 1,918,606 80 1,722,784 00 2,082,445 32 2,415,903 00 2,964,045 06 1,481,994 00 1,944,782 31 497,918 59 422 007 00 444 29 $ 30846,11700 $ 36,575,173 84 See notes to the general-purpose financial statements - 29 - SECTION II COMPLIANC!o AND IN'f ERNAL CONTROL REPORTS " I', \ .-: ;-\ -ti~ , .,_ ;:: -. ~. ;.-1 ;J ussH I W. Hu, 1o:-. STAii />J 'DI TOH (4 1-l i,1 ,,. "17 DEPARTMENT OF AUDITS AND ACCOUNTS 25 wJ..,hmgton ~trecl S \V ~UIIL 214 Atl.rntJ, C,~11rg1J 10134-HOO June 4, 2003 Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education and Supenntendent and Members of the Bulloch County Board of Educatwn REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen We have audited the financial statements of Bulloch County Board of Education as of and for the year ended Junc 30, 2002. and have issued our report thereon dated June 4, 2003 This report was qualified for various departures from generally accepted accounting pnnc1ples, as 1denhfied in the auditor's report on the general-purpose financial statements We conducted our audit in accordance with auditing standards generally accepted in the Umted States of Amenca and the standards applicable lo financial audits contained in Government Auditing Standards, issued by the Comptroller General of the Umted Stale~ Compliance As part of obtaining reasonable assurance about whether Bulloch County Board of Education's financial statements arc free of material m1s~latcmenl, we performed tests of its compliance with certain prov1s1ons oflaws, rcgula11ons, contracts and grants, noncompliance with which could have a direct and matenal effect on the determination of financial statement amounts However, providing an op1mon on compliance with those prov1s1ons was not an obJectlvc of our audit, and accordingly. we do not express such an op1mon The results of our tests disclosed no instances ofnoncomphancc that arc reqmred to be reported under Government Auditing Standards Internal Control Over Financial Reporting In planning and performing our audit, we con~1dcred Bulloch County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opmwn on the financial statements and not to provide assurance on the mternal 2002YB-41 control over financial reporting However, we noted a certam matter mvolving the internal control over financial reporting and its operallon that we consider to be a reportable cond1t1on Reportable cond1twns involve matters coming to our attenllon relating to s1gmficant defic1enc1es in the design or operation of the internal control over financial reportmg that, m ourJudgment, could adversely affect Bulloch County Board of Education's ab1hty to record, process, summanze and report financial data consistent with assertions of management m the financial statements The reportable cond11lon 1s descnbed m the accompanymg Schedule of Fmdmgs and Queslloncd Costs as Item FS-6161-02-01 A matcnal weakness 1s a cond1twn m which the design or operallon of one or more of the internal control components does not reduce to a relatively low level the nsk that misstatements in amounts that would be matenal in relation to the financial statements being audited may occur and not be detected within a timely penod by employees in the normal course of performing their assigned functions Our cons1derat10n of the internal control over financial reporting would not neccssanly disclose all matters in the internal control that might be reportable cond1twns and, accordingly, would not nccessanly disclose all reportable cond11Ions that are also considered to be matenal weaknesses However, we consider item FS-6161-02-01 to be a material weakness This report 1s intended solely for the information and use of the management, members of the Bulloch County Board ofEducallon, Federal awarding agencies and pass-through cnt1t1es and 1s not intended to be and should not be used by anyone other than these specified parties Respectfully submitted, RWH gp 2002YB-41 Hinton State Auditor .,,tqff,*;,' ,.;""~. IJ"'i"ihl I \\' HINT01' ~ TAT( Al.JOH OR 140-i 61,fi 211.. DEPARTMENT OF Auorrs AND ACCOUNTS 254 W.1.,hmgh1n ~!reel ~ \V Suite 214 Atl.mtJ, Gcorg.1.1 10114.8401.1 June 4, 2003 Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Educat10n and Superintendent and Members of the Bulloch County Board of Education REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133 Ladies and Gentlemen Compliance We ha,c audited the compliance of Bulloch County Board of Education with the types ofcomphance requirements described m the US Office of Management and Budget (0MB) Circular A-133 Compliance Supplement that arc applicable to each of1ts maJor Federal programs for the year ended Junc 30, 2002 Bulloch County Board of Education's ma1or Federal programs arc 1dcn11ficd m the Summary of Auditor's Results Section of the accompanymg Schedule ofFmdmgs and Questioned Costs Comphancc with the requirements of laws, regulat10ns, contracts and grants apphcable to each of its ma1or Federal programs 1s the respons1b1llty of Bulloch County Board of Education's management Our rcspons1h1hty 1s to express an opinion on Bulloch County Board of Education's compliance based on our audit We conducted our audit of compliance in accordance with aud1tmg standards generally accepted in the Umtcd States of Amcnca, the standards apphcable to financial audits contained in Government Auditing Standards, issued hy the Comptroller General of the Umted Stateq, and 0MB Circular A133, Audas 0JS1a1es. Local Governments, and Non-Profit Orga111~at10ns Those standards and 0MB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncomphancc with the types ofcomphancc requirements referred to ahove that could have a direct and matcnal effect on a maJor Federal program occurred An audit includes exarmmng, on a test basis, evidence about the Bulloch County Board of Education's comphancc with those requirements and performing such other procedures as we considered necessary in the circumstances We beheve that our audit provides a reasonable basis for our op1mon Our audit does not provide a legal determmallon on Bulloch County Board of Educal!on's comphance with those requirements 2002SA-40 In our op1mon, the Bulloch County 13oard of Educat10n complied, in all material respect,, with the reqmremcnts referred to above that are applicable to each of 11, maJor l'edcral programs for the year ended June 30, 2002 Internal Control Over Compliance The management ot Bulloch County Board ol Educat10n 1, responsible for cstablishmg and mamtaining effective internal control O\'er compliance \\Ith reqmrements of laws, regulations. contracts and grants applicahlc to Federal programs In planning and performing our audit, we con,1dered Bulloch County Board of Education's internal control over compliance with reqmremcnts that could have a direct and material effect on a ma_1or Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on comphance and to te,t and report on internal control over comphancc in accordance with 0MB Cm:ular A-133 We noted certain matter. involving the internal control over comphance and Its operation that we con,1der to be reportable conditions Reportable conditions involve malters coming to our attent10n rcfating to ,1gmficant defic1enc1es in the design or operation ot the internal control over compliance that, in our 1udgment, could adversely affect the Bulloch County Board of Education', ability lo admin1,ter a ma,1or I ederal program in accordance w1lh applicable requirement, oflaws, regulations. contracts and grant, Reportable cond111ons arc described in the accompanying Schedule of Findings r dnd Que,t1oncd Costs as items FA-6161-02-0 I and A-6161-02-02 A material weakne,s 1s a cond111on in which the design or operation of one or more of the internal control components doe, not reduce lo a rclatlYely km level of ri,k that noncompliance with the applicable requm:menls of laws. regulations, contracts and grants that would be matenal in relation 10 a maJor Federal program being audited may occur and not be detected within a timely period by employees in the norm.ii cour,e of performing their assigned function, Our consideration of the internal control over compliance would not nece,s,mly d1sclo~ all matters in the internal control that might be reportable cond111ons and. .iccordingly. would not necessarily d1,closc all reportable cond111ons that arc al,o cons1den:d to be material weakne,se, I lowever. we beheYe none of the reportable conditions de,cribcd aboYe 1, a material weakne Thi, report 1s intcndcd ,olcly tor the information and u,e ol the management. members of the Bulloch County Board ofl ducat1on, Federal av.arding agenc1c, .ind pa"-through cntltle, and 1s not intended to be and should not be u,ed hy anyone other than the,c specified parties ---- \(\.~L~ Respectfully subm11tcd, llinton Sidle Auditor RWH gp 2002SA-40 SCCTJONIII AUDI rEE'S RESPONSE 10 PRIOR YEAR l'INDINGS AND QUESl IONI,,D COSTS BUI LOCH COUN I Y BOARD OF EDUCATION AUDITEE'S RESPONSE SUMMARY SCHF-,DULE or PRIOR Y[AR l'INDINGS AND OUFSTION[D COSTS Y[AR ENDED JUNE 30, 2002 PRIOR Y[AR FINANCIAi STATEMENT FINDINGS AND OU[Sl ION ED cos1 S Fl!'iDING CONTROL NUMBER AND STATUS fS-6161-00-02 fS-6161-01-0 I turther Act10n Not Warranted Lnresol,ed - See Correcllve Acl1on!Resporn,es CORRECTIVE ACTION/RESPO'.'ISES GLNERJ\L FIXED ASSl: IS failure to Mamlam General Fixed Assets Account Group Fmdmg Control Number l'S-6161-01-01 The School D1stnct has valued a~scts u~mg a threshold of $5,000 00 The School D1stnct w1 II use FASGOV Software provided by Georgia Department of Education m order to put their assets on the boob by June 30. 2003 Therefore. this lindmg should he resolved m fiscal year 2003 SECTION IV FINDINGS AND QUESTIONED COSTS 11UI LOCH COUNl Y BOARD OF rDUCA rION SCHl:DULE or FINDINGS AND ovrs1 IONED cos Is YEA.R rNDI-D JUNI- 30, 2002 SL1MMARY 01- AUDITOR'S RESUL rs Iype of Report Issued on the Financial Statements The auditor', opinion on the 13ulloch County 110.ird of[ducat1on's financial ,tatcments was qualified lor vanous departures from generally accepted accounting principles 2 Reportable Cond1t1ons in Internal Control D1,clo,ed hv the Audit of the Financial Statements The audit report lor the 13ulloch County 13oard of l-.ducat1on d1scloscd a financial statement n:portahlc cond111on related to the lollowing control category General I 1xed Assets 1 he reportable cond1t1on de,cnbcd abo, c 1, con,1dered to be a matenal weakness 3 Noncompliance l\,latenal to the I inancial Statement, The audit of the Bulloch County Board of EduLat10n d1sdo,ed no instance, of noncompliance that were deemed to be matenal to the financial statements 4 Reportable Cond1t1ons m Internal Control Over Ma1or Program, The audit report for the flulloch County Board ot Education d1sclo,ed reportable cond1t1ons m internal umtrol over maJor programs lor the tollo\\ mg complmnce requirements AIIO\,able Co,islCo,t l'nnc1plcs Fqu1pment and Real Property Management None of the reportable cond1t1on, dcscnbed above are wns1dered to he a matenal weat-.ncss 5 I vpe of Report Issued on Compliance for Ma1or Program, The auditor's opinion on the Bulloch County 13oard ol Education's report on complmnce with re4u1rcmcnb applicable to ma1or progr.im, wa, unqualified 6 Audit rmdmgs Required to be Reported bv Section 5 I0(al of 0MB Circular A-133 I he Bulloch County Uoard ol Education', audit d1sclo,ed audit lindmg, required to he reported b) ,ect1on SI0(a) ofOMB C1rcular A-133 Thc,c audit lindmg, are included in ,cct10n IV of this report - I- BLLLOCH COUNTY BOARD OF EDUCATION s SCHI-.DULI- or nNDINGS AND OUl:.STIONED COSl YEAR ENDlD JUNL 30, 2002 SUMMARY or AUDITOR'S RESl IL Is 7 Ma1or Program, a, Federal award, audited as ma1or programs are follows IO 553 Food and Nutrition Program - Food Service, - School Breakfast Program 10 555 Food and Nutriuon Program - Food Services - Nat10nal School Lunch Program 10 559 Food and Nutrition Program - Food Services - Summer Food Service, Program tor Children 84 027 lnd1v1duals with D1sab1ht1cs Educatwn Act - Part B - Special Educauon - I low 1 hrough 84 173 lnd1v1dual, with D1sab1ht1es Fducatlon Act - Part B - Special Education - Preschool 84 027 lnd1v1duab wnh D1sab1huc, Education Act - Part B - Special Education - Capac1t) Bmlding Improvement 84 287 l 1tlc X - I wenty-F1rst Century Commumty Leaming Center:, 8 I vpc "A" Program Dollar Threshold The dollar thre,hold for type "A" program, was $300,000 00 9 Low R1,I,. Aud1tee 1 he Rulloch Count) Board of Educatwn did not qualify as a low risk audJtee a, defined b) Section 530 of 01\18 Cm:ular A-133 II rINA.NCIAL STA"I I::,Mf:'J I 1-I'JDINGS AND QUESTIONl'D COSTS GE\il::,RAL rtXED ASSETS Failure to Maintain General hxed Assets Account Group Reportabk Cond1t1on - Material Weaknes, Repeated horn Prior Year rinding Control Number lS-6161-02-01 The Hulloch County Board of Education did not maintain a ,),tern-wide General Fixed A<,<;ets A.cwunt Group \\ llhin the formal accounting records as requm:d 0) generally accepted accounting principle, Thi:, condition result, in the general-purpose financial ,tatements of the School D1,tnct hcing incomplete and not in accordance with generally accepted accounting principles A.ppropnate action ,hould he tal..cn by the School D1stncl to e,tabh:,h accounting controls and procedures to pro\'Jde for mainknanee of d General hxed Assets Account Group These ,ub,1d1ary records :,hould include an inventory of land. bmldmg:, and equipment owned by the School D1,tnct and ,hould include. but mdy not be hm1ted to, date acquired. acqu1s1t1on co,t, e,umated replacement co,t. location and de,cnpl1on Detailed records should be ma1ntain.:d of all add1t1on, and deletion, to the General ~ l',ed A. "ct:, Account Group BULLOCII COUN I Y BOARD OF EDUCATION SCHEDl TLE OF Fl1'.DI\IGS AND QUESTIONED COSTS Yl:AR ENDED JUNE 30. 2002 Ill lFDERAL AWARD fll\DINGS AND QUESTION FD COSTS Al LOWABLr COSTS/COS I PRINCIPLES l)1stnbution of Personnel Charge, Not Supported by Personnel Act1vtty Report, Reportable Cond1t1on LI S Department of Education Amount $18.500 01 Finding Control Number fA-6161-02-01 A review of ind1v1duals who performed both Twent)-F1rst Century Communtt} Learning Center; (CFDA 84 287) program acttvtttes and other program acttvt11es disclosed that a d1stnbutt0n ofthe1r salanes or wage, was not supported by personnel act1v1ty reports or equivalent documentation which meets the standards m Q_tfice of itunagement and Budget (0MB) Cm:ular A-87 attachment B. 1ectwn I I. 111h~l'Ctwn h re,ulting in a questioned cost ol $18.500 01 Ibis deficiency occurred because the School D1stnct had not estahltshed adequate control procedures and poltc1es requmng time d1stnbut1on records lor per,onnel who work on more than one I ederal award or a Federal award and a non-h:deral award The School D1,tnLI should implement poltc1es and procedures to ensure the required ind1 v1duals prepare personnel acttvtty report, or equivalent documentation that reflects ,rn alter-the-tact d1stnbutton ol actual work act1\ 1ty of each ind1v1dual The after-the-fact personnel acll\'lty report, or equivalent documentation ,hould reflect actual act1v1ty of personnel for tht total acttv1ty for which the employee 1s compen~tcd. must he prepared at least monthly and must coincide with one or more pay penods and he ,1gned The United States Department of ~duca11on should review this matter to deterrntne 1f a refund 1s appropnate EQUIPMENT AND REAL PROPER I Y MANAGEMEN I Inadequate Inventory Records Reportable Cond1t1on Nonmatenal l\oncompltance l I ~ Department of Agnculture I hrough Georg ta Department of Educatton Fmding Control Number r A-6161-02-02 Proper!) management records mamtamcd by the Bulloch County Board of Education for the Child Nutrtt1on Clw,ter ((TOA 10 553. 10 555 and 10 559) were incomplete and fatlcd to meet property management ,tandards ,ct torth in Chapter 41. of the financial Management for Georgia Local Umts of Admin1,tr.111on (fMC.LUA ). or as outlined m 7 Cl R JO 15 169 A review of eighteen ttems ,elected at t\\O loeat1orn, revealed the following delic1enc1es Seven items physically located were not included on the inventory ltstings One item had been disposed ol but not removed from the inventory listing A review of property managemt'nt record, revealed that numerou, item, were not a,s1gned a cost -3- BULLOCH COUNTY BO,\RD OF E UCATIO"\/ SCHLDLLI 01 Fl>IDl>JGS !\ND QU[S I IONED COS IS YEAR[N FDJIJN[J0.20~ Ill rrDI-RAL AWARD FINDINGS A:t\D OUFSTION[D COSTS FQUIPMLNT AND R[AL PROPl:RTY MANAGEMENT lnackquate Inventory Records Reportable Cond111on Nonmatcnal Noncompliance U S Oepartment ol Agriculture Through Georgia Department ot Education rmd1ng Control Number FA-6161-02-02 1 he,e cond1t1on, occurred because management failed to mamtam complete property management record, and to ensure that physical inventory counts were properly performed and rcconc1lcd to propcrt~ mJnagcment records An mvento1y system ~hould be 1mplemcnted that provides for complete 1m cnto1y record~ and 1dcnttficatton of all cqmpmcnt a, out Imed m Chapter 41. of the ~\1GLUA