CAMDEN COUNTY BOARD OF EDUCATION KINGSLAND, GEORGIA ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2015 (Including Independent Auditor's Reports) CAMDEN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - Page SECTION I FINANCIAL INDEPENDENT AUDITOR'S REPORT REQUIRED SUPPLEMENTARY INFORMATION MANAGEMENT'S DISCUSSION AND ANALYSIS i EXHIBITS BASIC FINANCIAL STATEMENTS DISTRICT-WIDE FINANCIAL STATEMENTS A STATEMENT OF NET POSITION 1 B STATEMENT OF ACTIVITIES 2 FUND FINANCIAL STATEMENTS C BALANCE SHEET GOVERNMENTAL FUNDS 4 D RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET POSITION 5 E STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS 6 F RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES 7 G STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS 8 H STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS 9 I NOTES TO THE BASIC FINANCIAL STATEMENTS 11 SCHEDULES REQUIRED SUPPLEMENTARY INFORMATION 1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS' RETIREMENT SYSTEM OF GEORGIA 30 2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 31 3 SCHEDULE OF CONTRIBUTIONS TEACHERS' RETIREMENT SYSTEM OF GEORGIA 32 4 SCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 34 5 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION 36 (This page left intentionally blank) CAMDEN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION I FINANCIAL SCHEDULES REQUIRED SUPPLEMENTARY INFORMATION 6 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND SUPPLEMENTARY INFORMATION 7 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 8 SCHEDULE OF STATE REVENUE 9 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS 10 ALLOTMENTS AND EXPENDITURES GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE) BY PROGRAM Page 37 38 39 40 41 SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (This page left intentionally blank) SECTION I FINANCIAL (This page left intentionally blank) Greg S. Griffin STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 March 17, 2016 Honorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Camden County Board of Education INDEPENDENT AUDITOR'S REPORT Ladies and Gentlemen: Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Camden County Board of Education, as of and for the year ended June 30, 2015, and the related notes to the financial statements (Exhibits A through I), which collectively comprise the Board's basic financial statements as listed in the table of contents. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the 2015ARL-11 (This page left intentionally blank) effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the basic financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the Camden County Board of Education, as of June 30, 2015, and the respective changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matter As described in Note 2 to the financial statements, in 2015, the Camden County Board of Education adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions an amendment of GASB Statement No. 27, GASB Statement No. 69, Government Combinations and Disposals of Government Operations and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date an amendment of GASB Statement No. 68. The School District restated beginning Net Position for the cumulative effect of these accounting changes. Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis, and the Schedules of Proportionate Share of the Net Pension Liability, Schedules of Contributions to Retirement Systems, the Notes to the Required Supplementary Information, and the Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual as presented on pages i through viii and pages 30 through 37 respectively, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Camden County Board of Education's basic financial statements. The accompanying supplementary information, consisting of Schedules 7 through 10, is presented for the 2015ARL-11 (This page left intentionally blank) purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is not a required part of the basic financial statements. The accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements as a whole. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 17, 2016, on our consideration of the Camden County Board of Education's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Camden County Board of Education's internal control over financial reporting and compliance. 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, GSG:er 2015ARL-11 Greg S. Griffin State Auditor (This page left intentionally blank) CAMDEN COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Introduction The discussion and analysis of Camden County Board of Education's financial performance provides an overall review of the School District's financial activities for the fiscal year ended June 30, 2015. The intent of this discussion and analysis is to look at the School District's financial performance as a whole; readers should also review the transmittal letter, notes to the basic financial statements and the financial statements to enhance their understanding of the School District's financial performance. Financial Highlights Key financial highlights for fiscal year 2015 are as follows: The School District's financial status changed during fiscal year 2015 as shown on the District-wide financial statements. In total, net position decreased $69.8 million from fiscal year 2014. This decrease was primarily due to the implementation of Governmental Accounting Standards Board Statement No. 68 Accounting and Financial Reporting for Pensions (GASB 68). The School District carried no long-term or short-term debt during the fiscal year. On the District-wide financial statements, the liabilities and deferred inflows of resources exceeded net position of the School District by $6.2 million due to the implementation of GASB 68. Of the net position, $-57.4 million is unrestricted. Exhibit A of the financial statements reflects a significant change due to the implementation of GASB 68. The GASB 68 pronouncement requires the reporting of the pension liability on the financial statements for fiscal year 2015. The School District has $84.0 million in expenses relating to governmental activities; only $50.5 million of these expenses are offset by program specific charges for services, grants and contributions. General revenues (primarily property and sales taxes) of $37.9 million were adequate to provide for these programs. As stated above, general revenues accounted for $37.9 million or 42.9% of all revenues totaling $88.4 million. Program specific revenues in the form of charges for services, grants and contributions accounted for the rest. Among major funds, the General Fund has $81.3 million in revenues, $79.5 million in expenditures. The General Fund's fund balance increased from $10.9 million to $12.8 million. OVERVIEW OF THE FINANCIAL STATEMENTS This annual report consists of three parts; management's discussion and analysis (this section), the basic financial statements and required supplementary information. The basic financial statements include two levels of statements that present different views of the School District. These include the District-wide and fund financial statements. The District-wide financial statements include the 'Statement of Net Position' and 'Statement of Activities'. These statements provide information about activities of the School District presenting both short-term and long-term information about the School District's overall financial status. The fund financial statements focus on individual parts of the School District, reporting the School District's operation in more detail. The 'Governmental Funds' statements disclose how basic services are financed in the short-term as well as what remains for future spending. The 'Fiduciary Funds' i CAMDEN COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 statements provide information about the financial relationships in which the School District acts solely as a trustee or agent for the benefit of others. The fund financial statements reflect the School District's most significant funds. In the case of the Camden County School District, the General Fund and District-wide Capital Projects Fund are the most significant funds. The financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements. District-wide Statements Since Camden County School District has no operations that have been classified as "Business Activities", the District-wide financial statements are basically a consolidation of all the School District's operating funds into one column called governmental activities. In reviewing the District-wide financial statements, a reader might ask the question, are we in a better financial position than last year? The 'Statement of Net Position' and the 'Statement of Activities' provides the basis for answering this question. These financial statements include all School District's assets and liabilities and use the accrual basis of accounting similar to the accounting used by most private-sector companies. The basis of accounting takes into account all of the current year's revenues and expenses regardless of when cash is received or paid. These two statements report the School District's net position and any change in the position. The change in net position is important because it tells the reader that, for the School District as a whole, the financial position of the School District has improved or diminished. The causes of this change may be the results of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs and other factors. The 'Statement of Net Position' and the 'Statement of Activities' reflects the School District's governmental activities. The change in net position is an important analysis tool because it informs the reader of financial changes experienced by the School District. The causes of the changes may be the results of many factors, including those not under the School Districts control, such as decreased funding, required educational programs, student-teacher ratios, and other factors. When analyzing District-wide financial statements, it is important to remember these statements are prepared using an economic resources measurement focus (accrual accounting) and involve the following steps to format the Statement of Net Position: Capitalize current outlays for capital assets Depreciate capital assets Report long-term debt as a liability Calculate revenue and expense using the economic resources measurement focus and the accrual basis of accounting ii CAMDEN COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Allocate net position as follows: Net Investment in Capital Assets Restricted net position is amounts with constraints placed on the use by external sources such as creditors, grantors, contributors or laws and regulations. Unrestricted for no specific use Fund Financial Statements The School District uses many funds to account for a multitude of financial transactions during the fiscal year. However, the fund financial statements presented in this report provide detail information about only the School District's significant or major funds. Governmental Funds - Most of the School District's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using the modified accrual method of accounting which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The difference between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds is reconciled in the financial statements. Fiduciary Funds The School District is the trustee, or fiduciary, for assets that belong to others, such as school clubs and organizations within the principals' accounts. The School District is responsible for ensuring the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the District-wide financial statements because it cannot use these assets to finance its operations. FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE Recall that the Statement of Net Position provides the perspective of the School District as a whole. Table 1 provides a summary of the School District's net position for fiscal year 2015 compared to fiscal year 2014. Net position, which is the difference between total assets and deferred outflows of resources, and total liabilities and deferred inflows of resources, is one indicator of the financial condition of the School District. When revenues exceed expenses, the result is an increase in net position. When expenses exceed revenues, the result is a decrease in net position. The relationship between revenues and expenses are the operating results. The School District's net position, as measured in the Statement of Net Position is one way to measure the School District's financial position. Over time, increases or decreases in the net position, as measured in the Statement of Activities, are one indicator of whether its financial position is improving or deteriorating. However, the goal and mission is to provide success for all students in the school district by utilizing the resources wisely. iii CAMDEN COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Table 1 Net Position (In Thousands) Governmental Activities Fiscal Fiscal Year 2015 Year 2014 (1) Assets Current and Other Assets Capital Assets, Net $ 37,325 $ 38,047 124,811 122,524 Total Assets 162,136 160,571 Deferred Outflows of Resources Pension Plans 6,176 0 Liabilities Current and Other Liabilities 66,576 9,714 Deferred Inflows of Resources Pension Plans 20,692 0 Net Position Invested in Capital Assets Restricted Unrestricted 124,811 13,665 -57,432 122,524 15,687 12,646 Total Net Position $ 81,044 $ 150,857 (1) Fiscal year 2014 balances do not reflect the effects of the restatement of Net Position. See Note 2 in the Notes to the Basic Financial Statements for additional information. Total net position decreased by $69.8 million in fiscal year 2015. The reporting of the net pension liability, deferred inflows of resources related to pension plans, and deferred outflows of resources related to pension plans resulted in a decrease to net position of $71.8 million. Table 2 shows the changes in net position for fiscal year 2015 compared to the changes in net position for fiscal year 2014. iv CAMDEN COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Table 2 Change in Net Position (In Thousands) Revenues Program Revenues: Charges for Services and Sales $ Operating Grants and Contributions Capital Grants and Contributions Total Program Revenues General Revenues: Taxes Property Taxes For Maintenance and Operations Railroad Cars Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects Other Sales Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous Total General Revenues Total Revenues Program Expenses: Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Total Expenses Increase (Decrease) in Net Position $ Governmental Activities Fiscal Year Fiscal Year 2015 2014 (1) 1,578 $ 48,574 307 50,459 1,535 46,237 351 48,123 26,741 20 7,179 307 2,035 42 1,602 37,926 88,385 53,469 3,363 3,124 1,622 397 5,570 748 5,745 3,719 310 985 16 507 4,409 83,984 4,401 $ 26,228 36 7,103 247 35 1,522 35,171 83,294 56,956 3,400 3,217 1,667 404 5,598 542 5,591 3,845 262 1,044 409 4,270 87,205 -3,911 (1) Fiscal year 2014 balances do not reflect the effects of the restatement of Net Position See Note 2 in the Notes to the Basic Financial Statements for additional information. v CAMDEN COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Governmental Activities Instruction comprised 63.7% of governmental program expenses in fiscal year 2015. Camden County incurred no interest expense during fiscal year 2015. The Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services comparing fiscal year 2015 with fiscal year 2014. That is, it identifies the cost of these services supported by tax revenue and unrestricted State entitlements. Table 3 Governmental Activities (In Thousands) Total Cost of Services Fiscal Fiscal Year 2015 Year 2014 (1) Net Cost of Services Fiscal Fiscal Year 2015 Year 2014 (1) Instruction $ Support Services: Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services: Enterprise Operations Community Services Food Services 53,469 $ 3,363 3,124 1,622 397 5,570 748 5,745 3,719 310 985 16 507 4,409 56,956 3,400 3,217 1,667 404 5,598 542 5,591 3,845 262 1,044 409 4,270 22,979 2,117 1,129 578 -833 1,609 548 1,317 2,660 192 842 16 21 351 28,329 2,230 1,186 584 -832 1,860 363 1,323 2,571 161 856 14 437 Total Expenses $ 83,984 $ 87,205 33,526 39,082 (1) Fiscal year 2014 balances do not reflect the effects of the restatement of Net Position See Note 2 in the Notes to the Basic Financial Statements for additional information. Although program revenues make up a majority of the revenues, the School District is still dependent upon tax revenues for governmental activities. Over 43.0% of instruction activities are supported through taxes and other general revenues; for all governmental activities general revenue support is 39.9%. vi CAMDEN COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT'S FUNDS The School District's governmental funds are accounted for using the modified accrual basis of accounting. The governmental funds had total revenues and other financing sources of $88.7 million and total expenditures and other financing uses of $88.8 million. General Fund Budgeting Highlights The School District's budget is prepared according to Georgia law. The most significant budgeted fund is the General Fund. During the course of fiscal year 2015, the School District amended its general fund budget as needed. For the General Fund, the final actual revenues of $81.3 million exceeded the original budgeted amount of $74.8 million by $6.5 million. This difference was primarily due to an increase in property taxes revenues over original budget of $0.7 million, Federal revenues over original budget of $4.1 million, state revenue over original budget of $0.7 million, Charges for Services over the original budget of $0.2 million, and the miscellaneous revenues over original budget of $0.7 million. Federal revenues exceeded the original budget due to the system's eligibility as a Heavily Federally Impacted district through the U.S. Department of Education Impact Aid program. Final budgeted expenditures and other financing uses of $82.7 million exceeded the original budgeted amount of $81.0 million by $1.7 million. The final budgeted expenditures of $82.3 million exceeded the actual expenditures of $79.5 million by $2.8 million. CAPITAL ASSETS AND DEBT ADMINISTRATION Capital Assets At fiscal year end June 30, 2015 the School District had $124.8 million invested in capital assets, all in governmental activities. Table 4 shows fiscal year 2015 balances compared with fiscal year 2014 balances. Table 4 Capital Assets (Net of Depreciation, in Thousands) Governmental Activities Fiscal Fiscal Year 2015 Year 2014 Land $ Construction In Progress Building and Improvements Equipment Land Improvements 10,704 $ 2,567 104,099 5,140 2,301 10,704 365 104,344 4,627 2,484 Total $ 124,811 $ 122,524 The School District has numerous capital renovation projects. Additional information about the Capital Assets can be found in the Notes to the Basic Financial Statements. vii CAMDEN COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Debt At fiscal year end June 30, 2015, the School District had no obligation for debt. Long-Term Liabilities At June 30, 2015 the School District reported a liability for its proportionate share of the net pension liability that reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. Reporting this liability was required by GASB 68. In fiscal year 2015, the School District implemented Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions. Implementation of this statement required the School District to record a charge (decrease) to the District-wide Net Position at July 1, 2014 for the School Districts share of the net pension liability for the pension plans administered through the Teachers' Retirement System of Georgia (TRS) and Employees' Retirement System of Georgia (ERS). Readers should understand implementation of (GASB) Statement 68 will not affect the School District's Governmental Fund Statements. It does however, impact the District-wide Statements. Current Issues Camden County is located in the southeast corner of Georgia, bordered on the south by Florida and to the east by the Atlantic Ocean. The two major municipalities, Kingsland and St Marys, are approximately 30 miles from Jacksonville, Florida. Camden County is the home of Kings Bay Naval Submarine Base, homeport to a fleet of Trident Nuclear Submarines. The School District, naval base and associated Federal contractors make up the core of employment opportunities in the county. The dramatic increase in coastal real estate investments by planned community developers will present many opportunities for school and community leaders in the coming years. Military families from every part of the nation, families employed in Florida seeking a quality education for children and retiring baby boomers from northern states will shape the growth of the community. As the ninth largest county in the state of Georgia, Camden County covers an area of approximately 659 square miles. The County has a population of 50,513 residents who reside in one of three municipalities or in a vast unincorporated area. Residents approved a Special Purpose Local Option Sales Tax for Education (ESPLOST) in March 2009 to meet the capital improvement needs of the School District. Collections for the 2009 ESPLOST concluded in July 2014. The sales tax rate, in Camden County is 7.0% while the property tax assessment for education at 15.82 mills. On November 5, 2013, the voters of Camden County approved the continuation of ESPLOST. Collections for the 2013 ESPLOST began in August 2014. Contacting the Board's Financial Management This financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and show the School District's accountability for the money received. If you have questions about this report or need additional financial information, contact Mrs. Angela C. Eason, Director of Finance at the Camden County Board of Education, 311 S. East Street, Kingsland, Georgia, 31548. You may email your questions to aeason@camden.k12.ga.us. viii CAMDEN COUNTY BOARD OF EDUCATION (This page left intentionally blank) CAMDEN COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2015 ASSETS Cash and Cash Equivalents Investments Accounts Receivable, Net Taxes State Government Federal Government Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation) Total Assets DEFERRED OUTFLOWS OF RESOURCES Related to Defined Benefit Pension Plans LIABILITIES Salaries and Benefits Payable Retainages Payable Net Pension Liability Total Liabilities DEFERRED INFLOWS OF RESOURCES Related to Defined Benefit Pension Plans NET POSITION Investment in Capital Assets Restricted for Continuation of Federal Programs Capital Projects Unrestricted (Deficit) Total Net Position EXHIBIT "A" GOVERNMENTAL ACTIVITIES $ 6,746,267.71 21,240,306.01 2,881,039.29 5,742,162.22 625,539.55 89,801.48 13,270,665.92 111,540,134.56 162,135,916.74 6,175,788.36 9,129,441.00 156,629.06 57,289,527.00 66,575,597.06 20,692,071.00 124,810,800.48 1,359,139.32 12,306,592.42 -57,432,495.18 $ 81,044,037.04 The notes to the basic financial statements are an integral part of this statement. -1 - CAMDEN COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2015 GOVERNMENTAL ACTIVITIES Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Total Governmental Activities General Revenues Taxes Property Taxes For Maintenance and Operations Railroad Cars Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects Other Sales Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous Total General Revenues Change in Net Position Net Position - Beginning of Year, Restated Net Position - End of Year EXPENSES CHARGES FOR SERVICES $ 53,468,864.49 $ 302,578.66 3,362,672.71 3,124,276.70 1,622,321.65 396,723.80 5,569,610.85 748,523.18 5,744,629.56 3,719,575.60 309,778.89 985,014.14 16,460.43 506,857.07 4,408,929.73 485,497.00 789,508.78 $ 83,984,238.80 $ 1,577,584.44 The notes to the basic financial statements are an integral part of this statement. -2 - EXHIBIT "B" PROGRAM REVENUES OPERATING GRANTS AND CONTRIBUTIONS CAPITAL GRANTS AND CONTRIBUTIONS NET (EXPENSES) REVENUES AND CHANGES IN NET POSITION $ 30,083,911.53 $ 1,238,217.08 1,990,378.62 1,040,762.99 1,225,806.79 3,947,776.96 200,591.07 4,413,102.49 904,688.61 117,927.76 142,964.74 3,268,170.04 $ 48,574,298.68 $ 103,186.54 $ 7,230.21 5,342.75 3,500.95 4,718.67 13,273.15 608.86 14,353.87 154,440.00 306,655.00 -22,979,187.76 -2,117,225.42 -1,128,555.33 -578,057.71 833,801.66 -1,608,560.74 -547,323.25 -1,317,173.20 -2,660,446.99 -191,851.13 -842,049.40 -16,460.43 -21,360.07 -351,250.91 -33,525,700.68 26,741,321.09 19,933.99 7,179,423.13 307,247.76 2,034,957.00 41,735.70 1,601,651.76 37,926,270.43 4,400,569.75 76,643,467.29 $ 81,044,037.04 -3 - CAMDEN COUNTY BOARD OF EDUCATION BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2015 EXHIBIT "C" ASSETS Cash and Cash Equivalents Investments Accounts Receivable, Net Taxes State Government Federal Government Inventories Total Assets LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES LIABILITIES Cash Overdraft Salaries and Benefits Payable Retainages Payable Total Liabilities DEFERRED INFLOWS OF RESOURCES Unavailable Revenues - Property Taxes FUND BALANCES Nonspendable Restricted Assigned Unassigned Total Fund Balances Total Liabilities, Deferred Inflows of Resources and Fund Balances GENERAL FUND DISTRICT-WIDE CAPITAL PROJECTS FUND TOTAL $ 6,868,766.21 $ 6,868,766.21 7,934,763.58 $ 13,305,542.43 21,240,306.01 2,292,148.95 5,742,162.22 625,539.55 89,801.48 588,890.34 2,881,039.29 5,742,162.22 625,539.55 89,801.48 $ 23,553,181.99 $ 13,894,432.77 $ 37,447,614.76 $ $ 9,129,441.00 9,129,441.00 1,608,970.12 122,498.50 $ 156,629.06 279,127.56 122,498.50 9,129,441.00 156,629.06 9,408,568.56 1,608,970.12 89,801.48 1,269,337.84 673,023.22 10,782,608.33 12,814,770.87 12,306,592.42 1,308,712.79 13,615,305.21 89,801.48 13,575,930.26 1,981,736.01 10,782,608.33 26,430,076.08 $ 23,553,181.99 $ 13,894,432.77 $ 37,447,614.76 The notes to the basic financial statements are an integral part of this statement. -4 - CAMDEN COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET POSITION JUNE 30, 2015 EXHIBIT "D" Total Fund Balances - Governmental Funds (Exhibit "C") Amounts reported for Governmental Activities in the Statement of Net Position are different because: Capital Assets used in Governmental Activities are not financial resources and therefore are not reported in the funds. These assets consist of: Land Construction in Progress Land Improvements Buildings Equipment Accumulated Depreciation Total Capital Assets Some liabilities, including net pension obligations, are not due and payable in the current period and, therefore, are not reported in the funds. Net Pension Liability Deferred Outflows and Inflows of Resources related to pensions are applicable to future periods and, therefore, are not reported in the governmental funds. Taxes that are not available to pay for current period expenditures are deferred in the funds. Net Position of Governmental Activities (Exhibit "A") $ 26,430,076.08 $ 10,704,215.80 2,566,450.12 4,077,697.51 131,761,963.42 12,882,223.35 -37,181,749.72 124,810,800.48 -57,289,527.00 -14,516,282.64 1,608,970.12 $ 81,044,037.04 The notes to the basic financial statements are an integral part of this statement. -5 - CAMDEN COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2015 EXHIBIT "E" REVENUES Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous Total Revenues EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation Capital Outlay Total Expenditures Net Change in Fund Balances Fund Balances - Beginning Fund Balances - Ending GENERAL FUND DISTRICT-WIDE CAPITAL PROJECTS FUND TOTAL $ 20,634,965.03 307,247.76 $ 43,429,393.43 13,775,347.32 1,577,584.44 20,981.80 1,601,651.76 81,347,171.54 $ 7,179,423.13 152,215.00 20,753.90 7,352,392.03 20,634,965.03 7,486,670.89 43,429,393.43 13,927,562.32 1,577,584.44 41,735.70 1,601,651.76 88,699,563.57 49,732,194.20 3,468,760.42 3,185,320.04 1,530,375.84 401,928.07 5,469,800.88 518,787.83 5,792,096.00 3,314,468.51 272,716.84 988,975.20 16,460.43 518,523.70 4,260,920.45 79,471,328.41 1,875,843.13 10,938,927.74 3,870,262.91 823.10 79,169.46 245,357.00 402,466.00 48,091.15 4,686,193.39 9,332,363.01 -1,979,970.98 15,595,276.19 53,602,457.11 3,468,760.42 3,185,320.04 1,531,198.94 401,928.07 5,548,970.34 764,144.83 5,792,096.00 3,716,934.51 320,807.99 988,975.20 16,460.43 518,523.70 4,260,920.45 4,686,193.39 88,803,691.42 -104,127.85 26,534,203.93 $ 12,814,770.87 $ 13,615,305.21 $ 26,430,076.08 The notes to the basic financial statements are an integral part of this statement. -6 - CAMDEN COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES T0 THE STATEMENT OF ACTIVITIES JUNE 30, 2015 EXHIBIT "F" Total Net Change in Fund Balances - Governmental Funds (Exhibit "E") Amounts reported for Governmental Activities in the Statement of Activities are different because: Capital Outlays are reported as expenditures in Governmental Funds. However, in the Statement of Activities, the cost of Capital Assets is allocated over their estimated useful lives as depreciation expense. In the current period, these amounts are: Capital Outlay Depreciation Expense Excess of Capital Outlay over Depreciation Expense The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position. Same items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in Governmental Funds. These activities consist of: Pension Expense Taxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds. $ -104,127.85 $ 5,293,140.00 -2,986,163.36 2,306,976.64 -20,029.69 2,408,344.36 -190,593.71 Change in Net Position of Governmental Activities (Exhibit "B") $ 4,400,569.75 The notes to the basic financial statements are an integral part of this statement. -7 - ASSETS Cash and Cash Equivalents Investments Georgia Fund 1 Total Assets LIABILITIES Funds Held for Others NET POSITION Held in Trust for Private Purposes CAMDEN COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS JUNE 30, 2015 PRIVATE PURPOSE TRUSTS EXHIBIT "G" AGENCY FUNDS $ 324,382.25 $ 25,543.68 25,543.68 $ 324,382.25 $ 324,382.25 $ 25,543.68 The notes to the basic financial statements are an integral part of this statement. -8 - CAMDEN COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS YEAR ENDED JUNE 30, 2015 ADDITIONS Contributions Donors Investment Earnings Interest DEDUCTIONS Scholarships Change in Net Position Net Position - Beginning Net Position - Ending EXHIBIT "H" PRIVATE PURPOSE TRUSTS $ 5,000.00 36.49 4,000.00 1,036.49 24,507.19 $ 25,543.68 The notes to the basic financial statements are an integral part of this statement. -9 - (This page left intentionally blank) CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY REPORTING ENTITY The Camden County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The 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 School District is a primary government and consists of all the organizations that compose its legal entity. NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION The School District's basic financial statements are collectively comprised of the District-wide financial statements, fund financial statements and notes to the basic financial statements of the Camden County Board of Education. District-wide Statements: The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non-exchange transactions. The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs. Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. Fund Financial Statements: The fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate statements for each category (governmental and fiduciary) are presented. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. The School District reports the following major governmental funds: General Fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund. District-wide Capital Projects Fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST) and grants from the U.S. Department of Education that are restricted, committed or assigned to the expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets. - 11 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" The School District reports the following fiduciary fund types: Private Purpose Trust fund reports trust arrangements under which income provides scholarship aid to graduating seniors of the Camden County School District. Agency funds account for assets held by the School District as an agent for various funds, governments, or individuals. BASIS OF ACCOUNTING The basis of accounting determines when transactions are reported on the financial statements. The District-wide governmental and fiduciary financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Non-exchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, grants and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants and donations are recognized in the fiscal year in which all eligibility requirements have been satisfied. The School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred. Capital asset acquisitions are reported as expenditures in governmental funds. The School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, both restricted and unrestricted resources are available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues. RESTATEMENT OF PRIOR YEAR NET POSITION For fiscal year 2015, the School District made several prior period adjustments due to the adoption of GASB Statement No. 68 and GASB Statement No. 71, as described in "New Accounting Pronouncements" below, which require the restatement of the June 30, 2014, net position in Governmental Activities. The result is a decrease in Net Position at July 1, 2014 of $74,214,154.00. This change is in accordance with generally accepted accounting principles. - 12 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" Net Position, July 1, 2014, as previously reported Prior Period adjustment - Implementation of GASB 68: Net pension liability (measurement date) TRS ERS Deferred Outlfows - School District's contribution made during fiscal year 2014 TRS ERS $ 150,857,621.29 $ -79,809,610.00 -86,426.00 -79,896,036.00 $ 5,673,934.00 7,948.00 5,681,882.00 Net Position, July 1, 2014, as restated $ 76,643,467.29 NEW ACCOUNTING PRONOUNCEMENTS In fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions. The provisions of this Statement establish accounting and financial reporting standards for pensions that are provided to the employees of state and local governmental employers through pension plans that are administered through trusts. The adoption of this statement has a significant impact on the School District's financial statements. As noted above the School District restated beginning Net Position for the cumulative effect of this accounting change. In fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 69, Government Combinations and Disposals of Government Operations. This Statement provides specific accounting and financial reporting guidance for combinations in the governmental environment. This statement also requires that disclosures be made by governments about combination arrangements in which they engage and for disposals of government operations. The School District did not have any activities of this type during the fiscal year and the adoption of this statement does not have a significant impact on the School District's financial statements. In fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement 71, Pension Transition for Contributions Made Subsequent to the Measurement Date - an amendment of GASB No. 68. The objective of this statement is to improve accounting and financial reporting by addressing an issue in Statement No. 68, Accounting and Financial Reporting for Pensions, concerning transition provisions related to certain pension contributions made to defined benefit pension plans prior to implementation of statement. This statement amends paragraph 137 of Statement No. 68 which limited recognition of pension-related deferred inflows of resources at the transition to circumstances in which it is practical to determine the amounts of all deferred outflows of resources and deferred inflows of resources related to pensions. The adoption of this statement has a significant impact on the School District's financial statements. As noted above the School District restated beginning Net Position for the cumulative effect of this accounting change. CASH AND CASH EQUIVALENTS Composition of Deposits Cash and cash equivalents consist of cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated Section 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations. - 13 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" INVESTMENTS Composition of Investments Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following: 1. Obligations issued by the State of Georgia or by other states, 2. Obligations issued by the United States government, 3. Obligations fully insured or guaranteed by the United States government or a United States government agency, 4. Obligations of any corporation of the United States government, 5. Prime banker's acceptances, 6. The local government investment pool (Georgia Fund 1) administered by the State of Georgia, Office of the State Treasurer, 7. Repurchase agreements, and 8. Obligations of other political subdivisions of the State of Georgia. The School District does not have a formal policy regarding investment policies that address credit risks, custodial credit risks, concentration of credit risks, interest rate risks or foreign currency risks. RECEIVABLES Receivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. PROPERTY TAXES The Camden County Board of Commissioners adopted the property tax levy for the 2014 tax digest year (calendar year) on September 24, 2014 (levy date). Taxes were due on December 19, 2014 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2014 tax digest are reported as revenue in the governmental funds for fiscal year 2015. The Camden County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2015, for maintenance and operations amounted to $19,404,651.97. - 14 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" The tax millage rate levied for the 2014 tax year (calendar year) for the Camden County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value): School Operations 15.82 mills Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $1,210,379.07 during fiscal year ended June 30, 2015. SALES TAXES Education Special Purpose Local Option Sales Tax, at the fund reporting level, during the year amounted to $7,179,423.13 and is to be used for capital outlay for educational purposes. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years. INVENTORIES Food Inventories On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (first-in, first-out). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used. CAPITAL ASSETS Capital assets purchased, including capital outlay costs, are recorded as expenditures in the fund financial statements at the time of purchase (including ancillary charges). On the District-wide financial statements, all purchased capital assets are valued at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at estimated fair market value on the date donated. Disposals are deleted at depreciated recorded cost. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. Depreciation is computed using the straight-line method. The School District does not capitalize book collections or works of art. During the fiscal year under review, no events or changes in circumstances affecting a capital asset that may indicate impairment were known to the School District. Capitalization thresholds and estimated useful lives of capital assets reported in the District-wide statements are as follows: Capitalization Policy Estimated Useful Life Land Land Improvements $ Buildings and Improvements $ Equipment $ Intangible Assets $ Any Amount 25,000.00 50,000.00 5,000.00 750,000.00 N/A 20 Years 20 to 80 Years 8 to 20 Years 50 Years Depreciation is used to allocate the actual or estimated historical cost of all capital assets over estimated useful lives, with the exception of intangible assets which are amortized. - 15 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" Amortization of intangible assets such as water, timber, and mineral rights, easements, patents, trademarks, copyrights and software is computed using the straight-line method over the estimated useful lives of the assets. DEFERRED OUTFLOWS/INFLOWS OF RESOURCES In addition to assets, the statement of net position and/or the balance sheet will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then. Under the full accrual method of accounting, the School District has reported deferred outflows of resources related to a defined benefit pension plan, as discussed in Note 12 Retirement Plans. In addition to liabilities, the statement of net position and/or the balance sheet will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time. Under the full accrual method of accounting, the School District has reported deferred inflows of resources related to a defined benefit pension plan, as discussed in Note 12 Retirement Plans. This item is reported only in the District-wide Statement of Net Position. Additionally, the School District has one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reporting only in the governmental funds balance sheet. The governmental funds report unavailable revenues from property taxes and this amount is deferred and will be recognized as an inflow of resources in the period in which the amount becomes available. PENSIONS For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Teachers' Retirement System of Georgia (TRS), the Employees' Retirement System of Georgia (ERS) and the Public School Employees' Retirement System (PSERS) and additions to/deductions from TRS/ERS/PSERS's fiduciary net position have been determined on the same basis as they are reported by TRS/ERS/PSERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. See Note 12 - Retirement Plans. NET POSITION The School District's net position in the District-wide Statements is classified as follows: Net investment in capital assets - This represents the School District's total investment in capital assets, net of outstanding debt obligations related to those capital assets. Restricted Net Position - This represents resources for which the School District is legally or contractually obligated to spend resources for continuation of Federal Programs and capital projects in accordance with restrictions imposed by external third parties. Unrestricted Net Position - Unrestricted Net Position is the net amount of the assets, deferred outflows of resources, liabilities and deferred inflows of resources that are not included in the determination of Net Investments of Capital Assets and Restricted Net Position. Included in the net deficit reported is the School District's Net Pension liability of $57,289,527 which is required for financial reporting. FUND BALANCES The School District's fund balances are classified as follows: Nonspendable Amounts that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact. - 16 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" Restricted Constraints are placed on the use of resources are either (1) externally imposed conditions by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation. Committed Amounts that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board of Education. The Board of Education is the School District's highest level of decision-making authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements. Assigned Amounts that are constrained by the School District's intent to be used for specific purposes, but are neither restricted nor committed. The intent should be expressed by (1) the Board of Education or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes. Unassigned The residual classification for the General Fund. This classification represents fund balances that has not been assigned to other funds and that has not been restricted, committed, or assigned to specific purposes within the General Fund. Fund Balances of the Governmental Funds at June 30, 2015, are as follows: Nonspendable Inventories Restricted Continuation of Federal Programs Captial Projects Assigned School Activity Accounts Local Capital Outlay Projects Unassigned $ 89,801.48 $ 1,269,337.84 12,306,592.42 13,575,930.26 673,023.22 1,308,712.79 1,981,736.01 10,782,608.33 Fund Balance, June 30, 2015 $ 26,430,076.08 When multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds. USE OF ESTIMATES The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. NOTE 3: BUDGETARY DATA The budget is a complete financial plan for the School District's fiscal year, and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the General Fund was prepared in accordance with accounting principles generally accepted in the United States of America. The budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines - 17 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of Official Code of Georgia Annotated section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. See Schedule 6 General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual for a detail of any over/under expenditures during the fiscal year under review. NOTE 4: DEPOSITS AND INVESTMENTS COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (O.C.G.A.) 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 of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. Section 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110 percent of the daily pool balance. Acceptable security for deposits consists of any one of or any combination of the following: 1. Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, 2. Insurance on accounts provided by the Federal Deposit Insurance Corporation, 3. Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, 4. Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, 5. Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, 6. Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and 7. Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. CATEGORIZATION OF DEPOSITS Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2015, the School District had deposits with a carrying amount of $7,200,759.09, which includes $130,109.13 in Certificates of Deposit that are reported as Investments. The School District has a bank balance of $11,580,607.51. The bank balances insured by Federal depository insurance were $836,688.11. The amounts exposed to custodial credit risk are classified into three categories as follows: - 18 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" Category 1 Category 2 - Category 3 - Uncollateralized, Cash collateralized with securities held by the pledging financial institution, or Cash collateralized with securities held by the pledging financial institution's trust department or agent but not in the School District's name. The School District's deposits by custodial risk category at June 30, 2015, are as follows: Custodial Credit Risk Category Bank Balance 1 $ 0.00 2 0.00 3 10,743,919.40 Total $ 10,743,919.40 CATEGORIZATION OF INVESTMENTS At June 30, 2015, the carrying value of the School District's total investments was $21,265,849.69, which is materially the same as fair value. This includes $130,109.13 invested in Certificates of Deposit, which are collateralized in the same manner as other cash deposits. This investment consisted of $21,135,740.56 invested in the Georgia Fund 1 (local government investment pool) administered by the State of Georgia, Office of the State Treasurer which is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1 (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Comprehensive Annual Financial Report. This audit can be obtained from the Georgia Department of Audits and Accounts at http://www.audits.ga.gov/SGD/cafr.html. The Primary Liquidity Portfolio consists of Georgia Fund 1 which is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2015, was 56 days. NOTE 5: NON-MONETARY TRANSACTIONS The School District receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 2 - Inventories - 19 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 NOTE 6: CAPITAL ASSETS The following is a summary of changes in the Capital Assets during the fiscal year: EXHIBIT "I" Balances July 1, 2014 Governmental Activities Capital Assets, Not Being Depreciated: Land Construction in Progress $ 10,704,215.80 365,469.64 $ Total Capital Assets Not Being Depreciated 11,069,685.44 Capital Assets, Being Depreciated: Buildings and Improvements Equipment Land Improvements Less Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements 129,993,596.94 12,295,508.53 4,077,697.51 25,649,893.68 7,669,262.28 1,593,478.93 Total Capital Assets, Being Depreciated, Net 111,454,168.09 Increases 2,566,450.12 $ 2,566,450.12 1,777,206.48 1,314,953.04 2,012,923.55 789,915.47 183,324.34 105,996.16 Decreases Balances June 30, 2015 $ 365,469.64 10,704,215.80 2,566,450.12 365,469.64 13,270,665.92 8,840.00 728,238.22 131,761,963.42 12,882,223.35 4,077,697.51 221.00 716,827.53 20,029.69 27,662,596.23 7,742,350.22 1,776,803.27 111,540,134.56 Governmental Activity Capital Assets - Net $ 122,523,853.53 $ 2,672,446.28 $ 385,499.33 $ 124,810,800.48 Current year depreciation expense by function is as follows: Instruction Support Services Pupil Services $ Improvements of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Food Services $ 699.50 6,557.50 112,620.07 6,935.23 156,774.46 2,229.60 38,514.77 518,449.69 1,394.92 1,891,774.74 844,175.74 250,212.88 $ 2,986,163.36 NOTE 7: RISK MANAGEMENT The School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; acts of God and unemployment compensation. The School District has obtained commercial insurance for risk of loss associated with torts, assets, and errors or omissions. The School District has neither significantly reduced coverage for these risks - 20 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" nor incurred losses (settlements) which exceeded the School District's insurance coverage in any of the past three years. The School District has elected to self-insure for all losses related to acts of God. The School District has not experienced any loss due to acts of God in the past three years. The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the General Fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. Changes in the unemployment compensation claims liability during the last two fiscal years are as follows: Beginning of Year Liability Claims and Changes in Estimates Claims Paid End of Year Liability 2014 $ 2015 $ 223.00 $ 267.00 $ 267.00 $ 340.00 $ 223.00 $ 607.00 $ 267.00 0.00 The School District participates in the Georgia Education Workers' Compensation Trust, a public entity risk pool organized on December 1, 1991, to develop, implement and administer a program of workers' compensation self-insurance for its member organizations. The School District pays an annual premium to the Trust for its general worker's compensation insurance coverage. Specific excess of loss insurance coverage is provided through an agreement by the Trust with the Safety National Casualty Company to provide coverage for potential losses sustained by the Trust in excess of $1 million loss per occurrence, up to the statutory limit. Employers' Liability insurance coverage is also provided with limits of $2 million. The Trust covers the first $1 million of each Employers liability claim with Safety National providing additional Employers Liability limits up to a $2 million per occurrence maximum. Safety National Casualty Company also provides $2 million in aggregate coverage to the Trust, attaching at 110% of the loss fund and based on the Fund's annual normal premium. The School District has purchased surety bonds to provide additional insurance coverage as follows: Position Covered Amount Superintendent $ 20,000.00 High School Principal $ 100,000.00 Each Middle School Principal $ 50,000.00 Each Elementary School Principal $ 20,000.00 Alternative School Principal $ 10,000.00 Vocational Supervisor $ 10,000.00 Athletic Director $ 10,000.00 - 21 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" NOTE 8: ON-BEHALF PAYMENTS The School District has recognized revenues and costs in the amount of $228,851.31 for retirement contributions paid on the School District's behalf by the following State Agencies. Georgia Department of Education Paid to the Teachers' Retirement System of Georgia For Teachers' Retirement System (TRS) Employer's Cost In the amount of $66,865.31 Office of the State Treasurer Paid to the Public School Employees' Retirement System For Public School Employees' Retirement (PSERS) Employer's Cost In the amount of $161,986.00 Funds paid on behalf of the School District are reported in governmental funds. See Note 12 Retirement Plans for the state support related to the net pension liability. NOTE 9: SIGNIFICANT COMMITMENTS The following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2015: Project Unearned Executed Contracts Mary Lee Clark Elementary School Re-Roof $ Matilda Harris Elementary School Re-Roof 163,342.16 323,815.61 $ 487,157.77 The amounts described in this note are not reflected in the basic financial statements. NOTE 10: SIGNIFICANT 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 costs which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position. The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not present determinable but is not believed to be material to the basic financial statements. NOTE 11: POST-EMPLOYMENT BENEFITS GEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND Plan Description. The Georgia School Personnel Post-employment Health Benefit Fund (School OPEB Fund) is a cost-sharing multiple-employer defined benefit post-employment healthcare plan that covers eligible former employees of public school systems, libraries and regional educational service agencies. The School OPEB Fund provides health insurance benefits to eligible former employees and their qualified beneficiaries through the State Employees Health Benefit Plan administered by the Department of Community Health. The Official Code of Georgia Annotated (O.C.G.A.) assigns the authority to establish and amend the benefit provisions of the group health plans, including benefits for retirees, to the Board of Community Health (Board). The Department of Community Health, which includes the School OPEB Fund, issues a separate stand alone financial audit report and a copy can - 22 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" be obtained from the Georgia Department of Audits and Accounts. Funding Policy. The contribution requirements of plan members and participating employers are established by the Board in accordance with the current Appropriations Act and may be amended by the Board. Contributions of plan members or beneficiaries receiving benefits vary based on plan election, dependent coverage, and Medicare eligibility and election. For members with fewer than five years of service as of January 1, 2012, contributions also vary based on years of service. On average, members with five years or more of service as of January 1, 2012, pay approximately 25% of the cost of the health insurance coverage. In accordance with the Board resolution dated December 8, 2011, for members with fewer than five years of service as of January 1, 2012, the State provides a premium subsidy in retirement that ranges from 0% for fewer than 10 years of service to 75% (but no greater than the subsidy percentage offered to active employees) for 30 or more years of service. The subsidy for eligible dependents ranges from 0% to 55% (but no greater than the subsidy percentage offered to dependents of active employees minus 20%). No subsidy is available to Medicare eligible members not enrolled in a Medicare Advantage Option. The Board of Community Health sets all member premiums by resolution and in accordance with the law and applicable revenue and expense projections. Any subsidy policy adopted by the Board may be changed at any time by Board resolution and does not constitute a contract or promise of any amount of subsidy. Participating employers are statutorily required to contribute in accordance with the employer contribution rates established by the Board. The contribution rates are established to fund all benefits due under the health insurance plans for both active and retired employees based on projected "payas-you-go" financing requirements. Contributions are not based on the actuarially calculated annual required contribution (ARC) which represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years. The combined active and retiree contribution rates established by the Board for employers participating in the School OPEB Fund were as follows for the fiscal year ended June 30, 2015: For certificated teachers, librarians and regional educational service agencies and certain other eligible participants: July 1, 2014 - June 30, 2015 $945 per member per month For non-certificated school personnel: July 1, 2014 - June 30, 2015 $596.20 per member per month No additional contribution was required by the Board for fiscal year 2015 nor contributed to the School OPEB Fund to prefund retiree benefits. Such additional contribution amounts are determined annually by the Board in accordance with the School plan for other post-employment benefits and are subject to appropriation. The School District's combined active and retiree contributions to the health insurance plans, which equaled the required contribution, for the current fiscal year and the preceding two fiscal years were as follows: Fiscal Year Percentage Contributed Required Contribution 2015 2014 2013 100% 100% 100% $ 6,997,904.46 $ 6,887,961.60 $ 6,322,214.59 - 23 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" NOTE 12: RETIREMENT PLANS Camden County Board of Education participates in various retirement plans administered by the State of Georgia, as further explained. TEACHERS' RETIREMENT SYSTEM OF GEORGIA (TRS) Plan Description: All teachers of the School District as defined in 47-3-60 of the Official Code of Georgia Annotated (O.C.G.A.) and certain other support personnel as defined by 47-3-63 are provided pension through the Teachers' Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers' Retirement System of Georgia issues a publicly available separate financial audit report that can be obtained at www.trsga.com/publications. Benefits Provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death. Contributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2015. The school district's contractually required contribution rate for the year ended June 30, 2015 was 13.15% of annual school district payroll. Employer contributions for the current fiscal year and the preceding two fiscal years are as follows: Fiscal Year Percentage Contributed Required Contribution 2015 2014 2013 100% 100% 100% $ 6,229,420.29 $ 5,747,626.05 $ 5,339,607.52 EMPLOYEES' RETIREMENT SYSTEM Plan description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. Benefits provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan - 24 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS. Under the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60. Retirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension, at reduced rates, to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS. Contributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200, plus 6% of annual compensation in excess of $4,200. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's contractually required contribution rate, actuarially determined annually, for the year ended June 30, 2015 was 21.96% of annual covered payroll for old and new plan members and 18.87% for GSEPS members. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employer contributions for the current fiscal year and the preceding two fiscal years are as follows: Fiscal Year Percentage Contributed Required Contribution 2015 2014 2013 100% 100% 100% $ 9,677.60 $ 7,947.62 $ 6,159.86 PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM (PSERS) Plan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers' Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. Benefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service. Upon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon - 25 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits. Contributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Individuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension At June 30, 2015, the School District reported a liability of $57,289,527.00 for its proportionate share of the net pension liability for TRS $57,217,815.00 and ERS $71,712.00. The TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows: School District's proportionate share of the net pension liability $ 57,217,815.00 State of Georgia's proportionate share of the net pension liability associated with the School District 656,067.00 Total $ 57,873,882.00 The net pension liability was measured as of June 30, 2014. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2013. An expected total pension liability as of June 30, 2014 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2014. At June 30, 2014, the School District's TRS proportion was 0.452899%, which was a decrease of 0.005122% from its proportion measured as of June 30, 2013. At June 30, 2014, the School District's ERS proportion was 0.001912%, which was an increase of 0.000131% from its proportion measured as of June 30, 2013. At June 30, 2015, the School District did not have a PSERS liability for a proportionate share of the Net Pension Liability because of a Special Funding Situation with the State of Georgia, which is responsible for the Net Pension Liability of the plan. The amount of the State's proportionate share of the Net Pension Liability associated with the School District is $670,954.00. - 26 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" The PSERS net pension liability was measure as of June 30, 2014. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2013. An expected total pension liability as of June 30, 2014 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2014. For the year ended June 30, 2015, the School District recognized pension expense of $3,756,707.00 for TRS, $6,825.00 for ERS and $58,268.00 for PSERS and revenue of $46,422.00 for TRS and $58,268.00 for PSERS. The revenue is support provided by the State of Georgia. At June 30, 2015, the School District reported deferred outflows of resources and deferred inflows of resources related to pension from the following sources: TRS Deferred Outflows Deferred Inflows of Resources of Resources ERS Deferred Outflows Deferred Inflows of Resources of Resources Net difference between projected and actual earnings on pension plan investments Changes in proportion and differences between School District contributions and proportionate share of contributions School District contributions subsequent to the measurement date $ $ 19,947,343.00 6,162,198.76 727,225.00 $ $ 17,503.00 3,912.00 9,677.60 Total $ 6,162,198.76 $ 20,674,568.00 $ 13,589.60 $ 17,503.00 Camden County Board of Education contributions subsequent to the measurement date of June 30, 2014 for TRS and ERS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2016. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year Ended June 30: TRS ERS 2016 2017 2018 2019 2020 $ -5,152,113.00 $ -1,931.00 -5,152,113.00 -2,909.00 -5,152,113.00 -4,376.00 -5,152,118.00 -4,375.00 -66,111.00 - - 27 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" Actuarial assumptions: The total pension liability as of June 30, 2014 was determined by an actuarial valuation as of June 30, 2013, using the following actuarial assumptions, applied to all periods included in the measurement: Teachers' Retirement System: Inflation Salary increases Investment rate of return 3.00% 3.75% - 7.00% 7.50% average, including inflation net of pension plan investment expense including inflation Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females set back two years for males and set back three years for females. The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009. Employees' Retirement System: Inflation Salary increases Investment rate of return 3.00% 5.45% - 9.25% 7.50% average, including inflation net of pension plan investment expense including inflation Mortality rates were based on the RP-2000 Combined Mortality Table for the periods after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back eleven years for males for the period after disability retirement. Public School Employees' Retirement System Inflation Salary increases Investment rate of return 3.00% N/A 7.50% net of pension plan investment expense, including inflation Mortality rates were based on the RP-2000 Combined Mortality Table set forward one year for males for the period after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back two years for males and set forward one year for females for the period after disability retirement. The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009. The long-term expected rate of return on TRS, ERS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: - 28 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2015 EXHIBIT "I" Asset class Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Total * Rates shown are net of the 3% assumed rate of inflation Target allocation 30.00% 39.70% 3.70% 1.60% 18.90% 6.10% 100.00% Long-term expected real rate of return* 3.00% 6.50% 10.00% 13.00% 6.50% 11.00% Discount rate: The discount rate used to measure the total TRS, ERS and PSERS pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and non-employer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS, ERS, and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the Camden County Board of Education's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50%) or 1-percentage-point higher (8.50%) than the current rate: Teachers' Retirement System: School District's proportionate share of the net pension liability 1% Decrease (6.5%) Current discount rate (7.50%) 1% Increase (8.50%) $ 105,444,756 $ 57,217,815 $ 17,503,930 Employees' Retirement System: 1% Decrease (6.5%) Current discount rate (7.50%) 1% Increase (8.50%) School District's proportionate share of the net pension liability $ 104,570 $ 71,712 $ 43,742 Pension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS, ERS and PSERS financial report which is publically available at www.trsga.com/publications and www.ers.ga.gov/formspubs/formspubs. - 29 - CAMDEN COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS' RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30, 2015 SCHEDULE "1" School District's proportion of the net pension liability School District's proportionate share of the net pension liability State of Georgia's proportionate share of the net pension liability associated with the School District Total School District's covered-employee payroll School District's proportionate share of the net pension liability as a percentage of its covered employee payroll Plan fiduciary net position as a percentage of the total pension liability 2015 0.452899% $ 57,217,815.00 656,067.00 $ 57,873,882.00 $ 46,804,772.41 122.25% 84.03% This schedule is intended to show information for 10 years. Additional years will be displayed as they become available. Schedule includes all significant plans and funds administered by Camden County Board of Education. -30 - CAMDEN COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30, 2015 SCHEDULE "2" School District's proportion of the net pension liability School District's proportionate share of the net pension liability School District's covered-employee payroll School District's proportionate share of the net pension liability as a percentage of its covered employee payroll Plan fiduciary net position as a percentage of the total pension liability 2015 0.001912% $ 71,712.00 $ 43,053.30 166.57% 77.99% This schedule is intended to show information for 10 years. Additional years will be displayed as they become available. Schedule includes all significant plans and funds administered by Camden County Board of Education. -31 - CAMDEN COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CONTRIBUTIONS TEACHERS' RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30 Contractually required contribution Contributions in relation to the contractually required contribution Contribution deficiency (excess) School District's covered-employee payroll Contributions as a percentage of covered-employee payroll 2015 2014 $ 6,229,420.29 $ 5,747,626.05 $ 6,229,420.29 $ 5,747,626.05 $ 0.00 $ 0.00 $ 47,372,017.56 $ 46,804,772.41 13.15% 12.28% This schedule is intended to show information for 10 years. Due to the retention policy of the Camden County Board of Education, the School District could only provide 6 years. Additional years will be displayed as they become available. -32 - SCHEDULE "3" 2013 2012 2011 2010 $ 5,339,607.52 $ 4,865,089.58 $ 5,151,741.52 $ 5,363,785.01 $ 5,339,607.52 $ 4,865,089.58 $ 5,151,741.52 $ 5,363,785.01 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 46,797,611.90 $ 47,325,774.10 $ 50,114,217.10 $ 55,069,661.30 11.41% 10.28% 10.28% 9.74% -33 - CAMDEN COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30 Contractually required contribution Contributions in relation to the contractually required contribution Contribution deficiency (excess) School District's covered-employee payroll Contributions as a percentage of covered-employee payroll 2015 2014 $ 9,677.60 $ 7,947.62 $ 9,677.60 $ 7,947.62 $ 0.00 $ 0.00 $ 44,069.36 $ 43,053.30 21.96% 18.46% This schedule is intended to show information for 10 years. Due to the retention policy of the Camden County Board of Education, the School District could only provide 6 years. Additional years will be displayed as they become available. -34 - SCHEDULE "4" 2013 2012 2011 2010 $ 6,159.86 $ 4,611.84 $ 4,025.92 $ 4,322.58 $ 6,159.86 $ 4,611.84 $ 4,025.92 $ 4,322.58 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 41,341.34 $ 39,654.70 $ 38,673.34 $ 41,524.04 14.90% 11.63% 10.41% 10.41% -35 - CAMDEN COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION FOR THE YEAR ENDED JUNE 30, 2015 SCHEDULE "5" Teachers' Retirement System Changes of assumptions : In 2010 and later, the expectation of retired life mortality was changed to the RP2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience. Method and assumptions used in calculations of actuarially determined contributions : The actuarially determined contribution rates in the schedule of contributions are calculated as of June 30, three years prior to the end of the fiscal year in which contributions are reported. The following actuarial methods and assumptions were used to determine the contractually required contributions for year ended June 30, 2015 reported in that schedule: Valuation date Actuarial cost method Amortization method Remaining amortization period Asset valuation method Inflation rate Salary increases Investment rate of return June 30, 2012 Entry age Level percentage of payroll, open 30 years Seven-year smoothed market 3.00% 3.75 7.00%, including inflation 7.50%, net of pension plan investment expense, including inflation Employees' Retirement System Changes of assumptions : There were no changes in assumptions or benefits that affect the measurement of the total pension liability since the prior measurement date. Method and assumptions used in calculations of actuarially determined contributions : The actuarially determined contribution rates in the schedule of contributions are calculated as of June 30, three years prior to the end of the fiscal year in which contributions are reported. The following actuarial methods and assumptions were used to determine the contractually required contributions for year ended June 30, 2015 reported in that schedule: Valuation date Actuarial cost method Amortization method Remaining amortization period Asset valuation method Inflation rate Salary increases Investment rate of return June 30, 2012 Entry age Level dollar, open 30 years Seven-year smoothed market 3.00% 2.725% 4.625% for FY 2012-2013, 5.45% - 9.25% for FY2014+ 7.50%, net of pension plan investment expense, including inflation -36 - CAMDEN COUNTY BOARD OF EDUCATION GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE YEAR ENDED JUNE 30, 2015 SCHEDULE "6" REVENUES Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous Total Revenues EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Operations Food Services Operations Total Expenditures Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES (USES) Other Sources Other Uses Total Other Financing Sources (Uses) Net Change in Fund Balance Fund Balances - Beginning NONAPPROPRIATED BUDGETS ORIGINAL (1) FINAL (1) ACTUAL AMOUNTS VARIANCE OVER/UNDER $ 19,909,843.49 $ 20,164,256.80 $ 20,634,965.03 $ 175,000.00 307,247.76 307,247.76 42,694,702.87 43,106,144.03 43,429,393.43 9,662,645.67 14,413,701.43 13,775,347.32 1,422,383.43 1,422,430.66 1,577,584.44 13,661.00 19,926.29 20,981.80 903,387.66 1,128,160.03 1,601,651.76 74,781,624.12 80,561,867.00 81,347,171.54 470,708.23 0.00 323,249.40 -638,354.11 155,153.78 1,055.51 473,491.73 785,304.54 52,006,149.18 3,443,129.29 2,866,209.41 1,512,652.10 472,812.42 5,342,347.40 602,292.62 5,999,597.06 3,471,692.91 267,851.33 225,835.36 474,385.00 4,252,045.12 80,936,999.20 -6,155,375.08 52,741,189.92 3,461,781.43 3,336,589.49 1,522,621.31 467,625.19 5,400,968.78 597,420.45 6,012,767.35 3,618,041.36 271,760.24 180,186.02 472,490.93 4,252,856.10 82,336,298.57 -1,774,431.57 49,732,194.20 3,468,760.42 3,185,320.04 1,530,375.84 401,928.07 5,469,800.88 518,787.83 5,792,096.00 3,314,468.51 272,716.84 988,975.20 16,460.43 518,523.70 4,260,920.45 79,471,328.41 1,875,843.13 3,008,995.72 -6,978.99 151,269.45 -7,754.53 65,697.12 -68,832.10 78,632.62 220,671.35 303,572.85 -956.60 -808,789.18 -16,460.43 -46,032.77 -8,064.35 2,864,970.16 3,650,274.70 101,317.82 -101,317.82 0.00 -6,155,375.08 10,854,711.24 373,485.29 -373,485.29 0.00 -1,774,431.57 10,854,711.24 1,875,843.13 10,938,927.74 -373,485.29 373,485.29 0.00 3,650,274.70 84,216.50 Fund Balances - Ending $ 4,699,336.16 $ 9,080,279.67 $ 12,814,770.87 $ 3,734,491.20 Notes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual (1) Original and Final Budget amounts do not include budgeted revenues or expenditures of the various principal accounts. The actual revenues and expenditures of the various principal accounts are $1,449,083.27 and $1,523,569.70, respectively. The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements. See notes to the basic financial statements. -37 - CAMDEN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30, 2015 SCHEDULE "7" FUNDING AGENCY PROGRAM/GRANT Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program Total U. S. Department of Agriculture Education, U. S. Department of Impact Aid Cluster Direct Impact Aid - School Construction Formula Grants Impact Aid Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Preschool Grants Total Special Education Cluster Other Programs Pass-Through From Georgia Department of Education ARRA - Race-to-the-Top Incentive Grant Career and Technical Education - Basic Grants to States Improving Teacher Quality State Grants Rural Education Title I Grants to Local Educational Agencies Total Other Programs Total U. S. Department of Education Defense, U. S. Department of Direct Promoting K-12 Student Achievement at Military Connected Schools Department of the Navy R.O.T.C. Program Total U. S. Department of Defense CFDA NUMBER PASSTHROUGH ENTITY ID NUMBER EXPENDITURES IN PERIOD * 10.553 * 10.555 N/A N/A $ (2) 4,056,638.66 (1) 4,056,638.66 84.404 (3) 84.041 (4) 84.027 N/A 84.173 N/A 84.395 N/A 84.048 N/A 84.367 N/A 84.358 N/A 84.010 N/A 12.556 1,797,295.42 90,130.08 1,887,425.50 10,370.80 85,411.00 286,910.26 167,966.68 1,811,872.55 2,362,531.29 4,249,956.79 8,387.45 100,058.18 108,445.63 Total Federal Financial Assistance N/A = Not Available $ 8,415,041.08 Notes to the Schedule of Expenditures of Federal Awards (1) Includes the Federally assigned value of donated commodities for the Food Donation Program in the amount of $259,851.65. (2) Expenditures for the funds earned on the School Breakfast Program ($759,800.77) were not maintained separately and are included in the 2015 National School Lunch Program. (3) Funds earned on this Impact Aid Program in the amount of $152,215.00, do not require reporting of expenditures. (4) Funds earned on this Impact Aid Program in the amount of $6,316,883.76, do not require reporting of expenditures. Major Programs are identified by an asterisk (*) in front of the CFDA number. The School District did not provide Federal Assistance to any Subrecipient. The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Camden 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 fund financial statements. See notes to the basic financial statements. -38 - CAMDEN COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2015 AGENCY/FUNDING GRANTS Bright from the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program Education, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Category I Category II Category III Category IV Category V Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Mid-Term Adjustment Hold Harmless Amended Formula Adjustment Categorical Grants Regular Nursing Services Education Equalization Funding Grant Other State Programs Food Services Math and Science Supplements Preschool Handicapped Program Pupil Transportation - State Bonds Teacher of the Year Teachers' Retirement Vocational Education Vocational Supervisors Office of the State Treasurer Public School Employees Retirement See notes to the basic financial statements. -39 - SCHEDULE "8" GOVERNMENTAL FUND TYPE GENERAL FUND $ 864,847.56 3,672,309.00 144,176.00 7,709,136.00 407,155.00 3,426,357.00 211,995.00 5,849,519.00 4,738,906.00 2,037,221.00 433,596.00 402,275.00 3,122,911.00 824,026.00 156,865.00 1,628,220.00 210,472.00 420,561.00 71,252.00 1,016,683.00 319,767.00 155,308.00 3,412.00 1,035,739.00 1,984,079.00 2,220,657.00 267,572.00 -3,852,904.00 921,650.00 171,487.00 2,034,957.00 110,703.00 49,504.91 210,044.40 154,440.00 1,014.25 66,865.31 38,493.00 26,136.00 161,986.00 $ 43,429,393.43 CAMDEN COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS YEAR ENDED JUNE 30, 2015 SCHEDULE "9" 2009 ESPLOST PROJECTS (i) Acquiring, constructing and equipping new schools and facilities useful and desirable, including an elementary school, a middle school, a fine arts academy and physical education/athletic facilities; $ (ii) Adding to, renovating, repairing, improving, and equipping existing school buildings and school system facilities; (iii) Acquiring real property for new school buildings and renovating and improving existing real property owned by the District, including but not limited to paving, landscaping, irrigation and drainage; (iv) Acquiring miscellaneous new equipment, fixtures and furnishings for the school system, including HVAC equipment, information technology equipment and software, safety and security equipment (vi) Purchasing textbooks Subtotal 2009 ESPLOST Projects 2013 ESPLOST PROJECTS (i) Adding to, renovating, repairing, improving, furnishing, and equipping existing school buildings and other buildings and facilities useful and desirable in connection therewith, including but not limited to fine arts academy, roofing, HVAC, paving; (ii) System-wide technology including but not limited to hardware and software, safety and security improvements; (iii) Purchasing textbooks and other educational software; (iv) Acquiring new school equipment; (v) Acquiring school buses, maintenance and transportation vehicles; (vi) Acquiring new band instruments, equipment and educational/instructional materials; (vii) Acquiring any necessary or desirable property, both real and personnel. Subtotal 2013 ESPLOST Projects Total $ ORIGINAL ESTIMATED COST (1) 45,000,000.00 5,500,000.00 $ 3,100,000.00 5,637,000.00 1,000,000.00 60,237,000.00 19,856,955.00 18,600,000.00 1,000,000.00 1,250,000.00 2,500,000.00 473,045.00 0.00 43,680,000.00 103,917,000.00 $ CURRENT ESTIMATED COSTS (2) EXPENDED IN CURRENT YEAR (3) EXPENDED IN PRIOR YEARS (3) TOTAL COMPLETION COST EXCESS PROCEEDS NOT EXPENDED ESTIMATED COMPLETION DATE 13,889,911.97 $ 4,264,344.81 $ 7,602,685.29 6/30/2017 6/30/2016 3,600,000.00 56,496.00 2,702,536.38 6/30/2016 14,000,000.00 1,273,239.39 32,763,151.36 2,794,910.52 823,064.32 7,938,815.65 9,020,247.78 450,175.07 $ 1,273,239.39 $ 19,775,644.52 1,273,239.39 0.00 0.00 6/30/2016 Completed 133,900.00 661,091.15 20,086.70 556,906.00 473,045.00 133,900.00 288,648.15 20,086.70 556,906.00 424,297.30 0.00 1,845,028.85 34,608,180.21 $ 1,423,838.15 0.00 9,362,653.80 $ 19,775,644.52 $ 1,273,239.39 $ 6/30/2019 6/30/2019 6/30/2019 6/30/2019 6/30/2019 6/30/2016 6/30/2019 0.00 (1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. 2009 ESPLOST: (Referendum approved March 2009) Final collection of funds were received in July 2014. 2013 ESPLOST: (Referendum approved March 2013) Collection of funds began in August 2014. (2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. (3) The voters of Camden County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Projects may include amounts expended for these projects may include sales tax proceeds, state, local property taxand/or other funds over the life of the projects. See notes to the basic financial statements. -40 - CAMDEN COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE) ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2015 SCHEDULE "10" DESCRIPTION Direct Instructional Programs Kindergarten Program Kindergarten Program-Early Intervention Program Primary Grades (1-3) Program Primary Grades-Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades-Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Category I Category II Category III Category IV Category V Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages ( ESOL) TOTAL DIRECT INSTRUCTIONAL PROGRAMS Media Center Program Staff and Professional Development ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)(2) ELIGIBLE QBE PROGRAM COSTS SALARIES OPERATIONS TOTAL $ 4,299,862.00 $ 170,883.00 9,002,288.00 478,170.00 4,043,141.00 248,923.00 6,880,256.00 5,585,785.00 2,394,376.00 5,752,296.00 1,887,318.00 212,466.00 494,808.00 81,670.00 41,532,242.00 1,191,962.00 182,425.00 4,199,067.56 $ 277,439.13 6,794,497.14 1,206,369.36 3,913,307.02 81,425.32 $ 724.31 320,971.00 2,937.96 115,975.24 955,269.15 6,998,162.59 6,910,319.01 2,217,816.90 481.94 171,065.59 264,110.37 190,936.48 147.56 657,420.25 2,771,790.82 197,104.99 2,529,169.24 1,795,920.41 296,642.60 8,022.33 2,802.72 61,117.31 8,077.03 3,660.66 27,333.79 949,280.00 5,364.00 41,720,443.73 2,214,286.05 1,348,652.10 56,822.46 128,138.95 43,876.60 4,280,492.88 278,163.44 7,115,468.14 1,209,307.32 4,029,282.26 955,751.09 7,169,228.18 7,174,429.38 2,408,753.38 8,169.89 660,222.97 2,832,908.13 205,182.02 2,532,829.90 1,823,254.20 296,642.60 949,280.00 5,364.00 43,934,729.78 1,476,791.05 100,699.06 TOTAL QBE FORMULA FUNDS $ 42,906,629.00 $ 43,125,918.29 $ 2,386,301.60 $ 45,512,219.89 (1) Comprised of State Funds plus Local Five Mill Share. (2) Allotments do not include the impact of the State amended formula adjustment. See notes to the basic financial statements. -41 - (This page left intentionally blank) SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS (This page left intentionally blank) Greg S. Griffin STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 March 17, 2016 Honorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Camden County Board of Education INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Camden County Board of Education as of and for the year ended June 30, 2015, and the related notes to the financial statements, which collectively comprise Camden County Board of Education's basic financial statements and have issued our report thereon dated March 17, 2016. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered Camden County Board of Education's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Camden County Board of Education's internal control. Accordingly, we do not express an opinion on the effectiveness of the Camden County Board of Education's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. 2015YB-10 (This page left intentionally blank) Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether Camden County Board of Education's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. We noted certain matters that we have reported to management of Camden County Board of Education in a separate letter dated March 17, 2016. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, not to provide an opinion on the effectiveness of the Camden County Board of Education's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Camden County Board of Education's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Respectfully submitted, GSG:er 2015YB-10 Greg S. Griffin State Auditor (This page left intentionally blank) Greg S. Griffin STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 March 17, 2016 Honorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Camden County Board of Education INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY OMB CIRCULAR A-133 Ladies and Gentlemen: Report on Compliance for Each Major Federal Program We have audited Camden County Board of Education's compliance with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2015. Camden County Board of Education's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs. Management's Responsibility Management is responsible for compliance with the requirements of laws, regulations, contracts, and grants applicable to its federal programs. Auditor's Responsibility Our responsibility is to express an opinion on compliance for each of Camden County Board of Education's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the Camden County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. 2015SA-10 (This page left intentionally blank) We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of Camden County Board of Education's compliance. Opinion on Each Major Federal Program In our opinion, the Camden County Board of Education complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2015. Report on Internal Control over Compliance Management of Camden County Board of Education is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered Camden County Board of Education's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with OMB Circular A-133, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the Camden County Board of Education's internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of OMB Circular A-133. Accordingly, this report is not suitable for any other purpose. Respectfully submitted, GSG:er 2015SA-10 Greg S. Griffin State Auditor (This page left intentionally blank) SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS (This page left intentionally blank) CAMDEN COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2015 PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. (This page left intentionally blank) SECTION IV FINDINGS AND QUESTIONED COSTS (This page left intentionally blank) CAMDEN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2015 I SUMMARY OF AUDITOR'S RESULTS Financial Statements Type of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Aggregate Remaining Fund Information Unmodified Internal control over financial reporting: Material weakness identified? Significant deficiency identified? No None Reported Noncompliance material to financial statements noted: No Federal Awards Internal Control over major programs: Material weakness identified? Significant deficiency identified? No None Reported Type of auditor's report issued on compliance for major programs: All major programs Unmodified Any audit findings disclosed that are required to be reported in accordance with OMB Circular A-133, Section 510(a)? No Identification of major programs: CFDA Numbers Name of Federal Program or Cluster 10.553, 10.555 Child Nutrition Cluster Dollar threshold used to distinguish between Type A and Type B programs: $446,524.20 Auditee qualified as low-risk auditee? Yes II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.