CARROLL COUNTY BOARD OF EDUCATION
CARROLLTON, GEORGIA REPORT ON AUDIT
OF THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2008
STATE OF GEORGIA
DEPARTMENT OF AUDITS AND ACCOUNTS
Russell W. Hinton State Auditor

CARROLL COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

REQUIRED SUPPLEMENTARY INFORMATION

MANAGEMENT'S DISCUSSION AND ANALYSIS

EXHIBITS

BASIC FINANCIAL STATEMENTS

DISTRICT-WIDE FINANCIAL STATEMENTS

A

STATEMENT OF NET ASSETS

I

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 ASSETS

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 ASSETS

FIDUCIARY FUNDS

8

H

STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS

FIDUCIARY FUNDS

9

I

NOTES TO THE BASIC FINANCIAL STATEMENTS

10

SCHEDULES

REQUIRED SUPPLEMENTARY INFORMATION

I SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES

IN FUND BALANCES - BUDGET AND ACTUAL

GENERALFUND

27

CARROLL COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

SCHEDULES

SUPPLEMENTARY INFORMATION

2 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

28

3 SCHEDULE OF STATE REVENUE

30

4 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

32

5 ALLOTMENTS AND EXPENDITURES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

BY PROGRAM

33

SECTION II
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENTAUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133

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

SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

Russell W. Hinton
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
May 6, 2009

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members ofthe Carroll County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION - SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying financial statements ofthe governmental activities, each major fund, and the aggregate remaining fund information (Exhibits A through I) of the Carroll County Board of Education, as of and for the year ended June 30, 2008, which collectively comprise the Board's basic financial statements as listed in the table of contents. These financial statements are the responsibility ofthe Carroll County Board ofEducation's management. 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 ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Carroll County Board of Education's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions.

2008ARL-11

In our opinion, the financial statements referred to previously present fairly, in all material respects, the respective financial position ofthe governmental activities, each major fund, and the aggregate remaining fund information ofthe Carroll County Board ofEducation, as of June 30, 2008, and the respective changes in financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America.

In accordance with Government Auditing Standards, we have also issued our report dated May 6, 2009, on our consideration ofthe Carroll County Board ofEducation'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 ofinternal control over financial reporting and compliance and the results ofthat testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit.

Management's Discussion and Analysis and the Schedule ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual, as presented on pages i through viii and page 27 respectively, are not a required part ofthe basic financial statements but are supplementary information required by the accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods ofmeasurement and presentation ofthe required supplementary information. However, we did not audit the information and express no opinion on it.

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Carroll County Board of Education's basic financial statements. The accompanying supplementary information which consist of Schedules 2 through 5, which includes the Schedule of Expenditures of Federal Awards as required by U.S. Office of Management and Budget Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements, and in our opinion, is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24.

Respectfully submitted,



~F:3--~
ell W. Hinton, CPA, CGFM
State Auditor

RWH:as 2008ARL-11

CARROLL COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2008
INTRODUCTION
Our discussion and analysis of the Carroll County School District's financial performance provides an overview of the School District's financial activities for the fiscal year ended June 30, 2008. The intent of this discussion and analysis is to look at the School District's financial performance as a whole; readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance.
FINANCIAL HIGHLIGHTS
Key financial highlights for 2008 are as follows:
On the District-wide financial statements, the assets of the School District exceeded liabilities by $147.9 million. Of this amount, $10.5 million is unrestricted and is available for spending at the School District's discretion.
The School District had $150.2 million in expenses relating to governmental activities; only $93 .2 million of these expenses are offset by program specific charges for services, grants and contributions. General revenues (primarily property and sales taxes) of $66.7 million were adequate to provide for these programs.
As stated above, general revenues accounted for $66.7 million or 42 percent of all revenues totaling $159.8 million. Program specific revenues in the form of charges for services, grants and contributions accounted for the rest.
OVERVIEW OF THE FINANCIAL STATEMENTS
This report consists of several parts including management's discussion and analysis, 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 fundfinancial statements.
The District-wide financial statements include the Statement of Net Assets and Statement of Activities. These statements provide information about the 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 statement provides 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 Carroll County School District, the General Fund, District-wide Capital Projects Funds, and Debt Service Funds are the most significant funds.
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CARROLL COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2008
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
The District-wide financial statements are basically a consolidation of all of 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 Assets and the Statement of Activities provides the basis for answering this question. These financial statements include all School District's assets and liabilities and uses the accrual basis of accounting similar to the accounting used by most private-sector companies. This 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 assets and any changes in those assets. The change in net assets 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 Assets and the Statement of Activities reflects the School District's governmental activities.
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 differences between governmental activities (reported in the Statement of Net Assets and the Statement of Activities) and governmental funds are reconciled within 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
- 11 -

CARROLL COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2008

responsible for ensuring that 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 Assets provides the perspective of the School District as a whole. Table 1 provides a summary of the School District's net assets for this fiscal year.

By far the largest portion of the School District's net assets, (85 percent) reflect its investment in capital assets (e.g., land and improvements, building and building improvements, vehicles, furniture, equipment and construction in progress), less any related debt used to acquire those assets that is still outstanding. The School District uses these capital assets to provide services to its students; consequently, these assets are not available for future spending. Although the School District's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

Table 1 Net Assets

Governmental Activities

Fiscal

Fiscal

Year 2008

Year 2007

Assets Current and Other Assets Capital Assets, Net

$ 95,559,603 $ 120,713,515

142,331,692

118,212,025

Total Assets

$ 237,891,295 $ 238,925,540

Liabilities Current and Other Liabilities Long-Term Liabilities

$ 16,728,671 73,237,263

$ 15,108,377 85,477,595

Total Liabilities

$ 89,965,934 $ 100,585,972

Net Assets Invested in Capital Assets, Net of Related Debt Restricted Unrestricted

$ 126,164,074 11,276,623 10,484,664

$ 114,550,682 10,467,268 13,321,618

Total Net Assets

$ 147,925.361 $ 138,339.568

Table 2 shows the Changes in Net Assets for this fiscal year.

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CARROLL COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2008

Table 2 Change in Net Assets

Revenues Program Revenues:
Charges for Services and Sales Operating Grants and Contributions Capital Grants and Contributions

Governmental Activities

Fiscal

Fiscal

Year 2008

Year 2007

$ 4,447,631 86,882,196 1,839,227

$ 4,607,888 82,019,221 5,008,805

Total Program Revenues

$ 93,169,054 $ 91,635,914

General Revenues:

Taxes

Property Taxes

For Maintenance and Operations

$ 35,050,435

Sales Taxes

Special Purpose Local Option Sales Tax

For Debt Service

12,766,992

Intangible Recording Tax

1,292,994

Transfer Taxes

Railroad Equipment Tax

Grants and Contributions not Restricted to

Specific Programs

11,967,171

Investment Earnings

3,584,471

Other

2,003,741

$ 32,439,389
12,320,927 1,290,188 395,870 25,982
11,454,073 2,420,674 1,427,260

Total General Revenues

$ 66,665,804 $ 61,774,363

Total Revenues

$ 159,834,858 $ 153,410,277

Program Expenses Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Ol)eration of Plant
Student Transportation Services Central Support Services
Other Support Services Operations of Non-Instructional Services
Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt

$ 92,382,777
4,134,276 3,040,360 2,960,342 2,635,297 9,571,277
825,362 9,200,510 9,821,408 1,135,961 1,019,481
2,594,376 667,383
7,195,017 3,065,238

$ 86,937,912
3,959,641 2,304,217 2,681,262 2,242,166 8,626,911
761,343 9,129,721 7,789,671
968,041 855,358
2,915,121 604,431
7,164,624 1,234,168

Total Expenses

$ 150,249,065 $ 138,174,587

Increase in Net Assets

$ 9!5851723 $ 15!2351620

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CARROLL COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2008

Governmental Activities

The Statement of Activities shows the cost of program services and the charges for services and grants offsetting these services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services. It identifies the cost of these services supported by tax revenue and unrestricted State entitlements. The table shows each functions net cost (total cost less charges for services generated by the activities and intergovernmental aid provided for specific programs). The net cost shows the financial burden that was placed on the School District's taxpayers by each of these functions.

Table3
Governmental Activities

Total Cost of Services

Fiscal

Fiscal

Year2008

Year2007

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 ofNon-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt

$ 92,382,777 $ 86,937,912

4,134,276 3,040,360 2,960,342 2,635,297 9,571,277
825,362 9,200,510 9,821,408 1,135,961 1,019,481

3,959,641 2,304,217 2,681,262 2,242,166 8,626,911
761,343 9,129,721 7,789,671
968,041 855,358

2,594,376 667,383
7,195,017 3,065,238

2,915,121 604,431
7,164,624 1,234,168

Total Expenses

$150,242,065 $ 138,114,581

Net Cost of Services

Fiscal

Fiscal

Year2008

Year2007

$ 26,333,401 $ 22,909,940

2,380,999 1,963,546 1,578,952
278,948 6,386,968
798,514 5,253,640 6,204,504 1,105,294
815,549

2,152,946 1,193,870 1,152,591 -150,590 5,388,835
746,055 5,221,142 3,867,083
950,305 622,616

248,433 615,911
50,114 3,065,238

747,667 524,931 -22,886 1,234,168

$57,080,011 $ 46,538,613

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT'S FUNDS

Governmental Funds: The focus of the School District's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the School District's financing requirements. In particular, unreserved fund balance may serve as a useful measure of the School District's net resources available for spending at the end of the fiscal year. 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 $160.3 million and total expenditures and other financing uses of $186.7 million. General Fund equity decreased by $446 thousand during the year. The Capital Projects Fund equity decreased by $23.9 million. Construction of school facilities to be re-paid by SPLOST sales tax receipts were forward funded with a $70 million bond issue. Capital Projects fund equity at June 30, 2008, was $58.2 million to be used in the continuing construction of school facilities.

-v-

CARROLL COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2008

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 2008, the School District amended its general fund budget as needed in particular due to student growth and facility safety needs.

For the General Fund, the actual revenues of $142.6 million were over the final budgeted amounts of $136.4 million by $6.2 million. This difference (actual vs. final budget) was due primarily to charges for services over final budget of $2.0 million and property taxes over final budget of $2.0 million. The charges for services over final budget were due to the inclusion of the principals' accounts in our financial statements, but not in the budget. State revenues exceeded budget figures by $3.4 million, Federal revenues were below budget by $789 thousand.

The actual expenditures of $143.0 million exceeded the final budgeted amount of$133.0 million by $10.0 million. This difference was due in part to our school principals' accounts not being included in the budget process. General Fund revenues were less than expenditures by $406 thousand.

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets

At fiscal year ended June 30, 2008, the School District had $142.3 million invested in capital assets, including school buildings, athletic facilities, buses and other vehicles, computers, and other equipment, all in governmental activities. Table 4 reflects a summary of these balances net ofaccumulated depreciation.

Table 4 Capital Assets (Net of Depreciation)

Governmental Activities

Fiscal

Fiscal

Year 2008

Year 2007

Land Construction in Progress Land Improvements Buildings and Improvements Equipment

$ 7,352,443 14,691,804 2,142,829 112,430,303 5,714,313

$ 6,671,205 15,059,894 2,429,023 88,386,031 5,665,872

Total

$ 1421331 .622 $ 1181212.025

- VI -

CARROLL COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2008

Due to the ongoing growth in the county, the School District has numerous construction projects including new buildings, additions and renovations.

Debt

At fiscal year ended June 30, 2008, the School District had $70 million in bonds outstanding, and $3.2 million in other long-term debt. Table 5 summarizes the School District's debt which includes general obligation bonds, capital leases and compensated absences outstanding.

Table 5 Debt at June 30

Governmental Activities

Fiscal

Fiscal

Year 2008

Year 2007

Bonds Payable Unamortized Bond Premium Capital Leases Compensated Absences

$ 70,000,000 1,823,612 782,134 631,517

$ 81,510,000 2,289,768 1,128,686 549,141

Total

$ 73,237,263 $ 85.477,595

At June 30, 2008, the School District's assigned bond ratings were "AA" as determined by Fitch Ratings, Inc.

CURRENT ISSUES

Currently known facts, decisions or conditions that are expected to have a significant effect on financial positions or results of operations.

Economic Slowdown - State funding for education has been stagnant and as a result more pressure is being placed on the local school districts to prioritize its educational programs and provide additional local funding. Over the past two years, the Carroll County Board has lost over $2.1 million in state funding shifting the burden to the local tax base. The current millage rate is 18.1 mills with a maximum of 20 mills. Currently, a mill of tax in Carroll County generates $1.6 million. Despite these challenges, the Carroll County School District is strong financially and we remain optimistic about the ability of the School District to maximize all of the financial resources to provide a quality education to our students.

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CARROLL COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2008 Capital Improvements - The School District plans capital improvements as future capital needs arise due to increased student population and facility repair and maintenance needs. Specific capital expenditure plans are formalized in conjunction with individual general obligation bond issues and anticipated annual receipts of capital outlay funds from the State of Georgia Department of Education. The School District regularly monitors anticipated capital outlay needs. CONTACTING THE SCHOOL DISTRICT'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 to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Mr. Greg Denney, Chief Financial Officer for the Carroll County School System, 164 Independence Drive, Carrollton Georgia 30117. You may also email your questions to Mr. Denney at greg.denney@carrollcountyschools.com.
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CARROLL COUNTY BOARD OF EDUCATION

CARROLL COUNTY BOARD OF EDUCATION STATEMENT OF NET ASSETS JUNE 30, 2008
ASSETS
Cash and Cash Equivalents Investments Receivables
Taxes Intergovernmental
State Federal Other Inventory Deferred Charges Capital Assets (Nondepreciable) Capital Assets (Net of Accumulated Depreciation)
Total Assets
LIABILITIES
Accounts Payable Salaries and Benefits Payable Accrued Interest Payable Retainage Payable Bonds Payable Due Within One Year Bonds Payable Due in More Than One Year Unamortized Bond Premium Due Within One Year Unamortized Bond Premium Due in More Than One Year Capital Leases Due Within One Year Capital Leases Due in More Than One Year Compensated Absences, Due in Less Than One Year Compensated Absences, Due in More Than One Year
Total Liabilities
NET ASSETS
Invested in Capital Assets, Net of Related Debt Restricted for
Continuation of Federal Programs Capital Projects Debt Service Unrestricted
Total Net Assets
Total Liabilities and Net Assets
The notes to the basic financial statements are an integral part of this statement.
-1-

EXHIBIT"A"

GOVERNMENTAL ACTIVITIES

$

77,420,936

28,502

3,819,326

11,287,880 2,108,746 147,532 172,995 573,686
22,044,247 120,287,445

$ =====2=37=,8=9=1='2=95=

$

368,502

14,682,022

783,159

894,988

11,720,000

58,280,000

570,803

1,252,809

312,742

469,392

442,062

189,455

$

89,965,934

$

126,164,074

543,769 5,201,543 5,531,311 10,484,664

$

147,925,361

$ =====2~37=,8=9;,,;,1l=,2=95=

CARROLL COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2008

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 Interest on Short-Term and Long-Term Debt
Total Governmental Activities
General Revenues Taxes Property Taxes, Levied for General Purposes Special Purpose Local Option Sales Tax For Debt Services Intangible Recording Tax Grants and Contributions not Restricted to Specific Programs Unrestricted Investment Earnings Other
Total General Revenues
Change in Net Assets
Net Assets - Beginning of Year
Net Assets - End of Year

EXPENSES

CHARGES FOR SERVICES

$

92,382,777 $

4,134,276 3,040,360 2,960,342 2,635,297 9,571,277
825,362 9,200,510 9,821,408 1,135,961 1,019,481

2,594,376 667,383
7,195,017 3,065,238

$

150,249,065 $

25,990
2,345,943 2,075,698 4,447,631

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

EXHIBIT"B"

PROGRAM REVENUES

OPERATING

CAPITAL

GRANTS AND

GRANTS AND

CONTRIBUTIONS CONTRIBUTIONS

NET (EXPENSES) REVENUES
AND CHANGES IN NET ASSETS

$

64,721,472 $

1,753,277 1,076,814 1,315,260 2,340,565 3,184,309
26,848 3,918,968 3,299,625
30,667 203,932

51,472 4,958,987

$

86,882,196 $

1,301,914 $
66,130 15,784 27,902 317,279
110,218 1,839,227 $

-26,333,401
-2,380,999 -1,963,546 -1,578,952
-278,948 -6,386,968
-798,514 -5,253,640 -6,204,504 -1, 105,294
-815,549
-248,433 -615,911
-50, 114 -3,065,238
-57,080,011

$

35,050,435

12,766,992 1,292,994
11,967,171 3,584,471 2,003,741

$

66,665,804

$

9,585,793

138,339,568

$

147,925,361

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CARROLL COUNTY BOARD OF EDUCATION BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2008

EXHIBIT"C"

ASSETS
Cash and Cash Equivalents Investments Receivables
Taxes Intergovernmental
State Federal Other Inventories
Total Assets
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts Payable Salaries and Benefits Payable Retainage Payable Deferred Revenue
Total Liabilities
FUND BALANCES
Reserved for: Continuation of Federal Programs Capital Outlay Debt Service
Unreserved Undesignated
Total Fund Balances
Total Liabilities and Fund Balances

GENERAL FUND

DISTRICTWIDE
CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$ 16,562,229 $ 57,567,490 $ 28,502

1,579,232

9,785,932 2,108,746
147,532 172,995

1,501,948

3,291,217 $ 2,240,094

77,420,936 28,502
3,819,326
11,287,880 2,108,746 147,532 172,995

$ 30,385,168 $ 59,069,438 $

$

368,502

14,682,022

$

1,088,075

$ 16,138,599 $

894,988 894,988

$

368,502

14,682,022

894,988

1 088,075

$

17,033,587

$

543,769

$ 58,174,450

$

13,702,800

$ 14,246,569 $ 58,174,450 $

$ 5,531,311
5,531,311 $

543,769 58,174,450
5,531,311
13,702,800
77,952,330

$ 30,385,168 $ 59,069,438 $ 5,531,311 $ ===9=4=9=85='=91=7=

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

CARROLL COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET ASSETS JUNE 30, 2008

EXHIBIT"D"

Total Fund Balances - Governmental Funds (Exhibit "C")
Amounts reported for Governmental Activities in the Statement of Net Assets 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:
Cost Less Accumulated Depreciation
Total Capital Assets
Other Long-Term Assets are not available to pay for current period expenditures and, therefore, are deferred in the funds.
Property Taxes
Long-Term Liabilities are not due and payable in the current period and therefore, are not reported in the funds.
Bonds Bond Premium, Net of Amortization Bond Issuance Costs, Net of Amortization Accrued Interest Capital Leases Compensated Absences
Total Long-Term Liabilities
Net Assets of Governmental Activities (Exhibit "A")

$

77,952,330

$ 178,807,490 -36,475,798

142,331,692

1,088,075

$ -70,000,000 -1,823,612 573,686 -783, 159 -782,134 -631,517

-73,446,736

$ ===14=7=,9=25='=36=1=

The notes to the basic financial statements are an integral part of this statement. -5-

CARROLL COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008

EXHIBIT"E"

REVENUES
Property Taxes Sales Taxes Other Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Food Services Operation Community Services Operation
Capital Outlay Debt Services
Principal Retirement Interest and Fees
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHEB FINANCING SOURCES {USES}
Proceeds from Sale of Capital Assets Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending

GENERAL FUND

DISTRICTWIDE
CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$ 35,016,827

$

$ 12,766,992

1,292,994

87,722,403 $ 1,501,948

11,464,243

4,447,631

631,818

2,654,469

298,184

2,003,741

$ 142,579,657 $ 4,156,417 $ 13,065,176 $

35,016,827 12,766,992 1,292,994 89,224,351 11,464,243 4,447,631 3,584,471 2,003,741
159,801,250

$ 88,685,189

$

4,134,276

3,040,360

2,769,439

2,589,290

9,488,901

825,018 $

344

9,113,421

8,636,771

1,135,961

558,208

2,594,376

7,195,017

667,383

1,143,025

28,644,150

346,552 62,432

$ 11,510,000 3,047,221

$ 142,985,619 $ 28,644,494 $ 14,557,221 $

$ -405,962 $ -24,488,077 $ -1,492,045 $

88,685,189
4,134,276 3,040,360 2,769,439 2,589,290 9,488,901
825,362 9,113,421 8,636,771 1,135,961
558,208 2,594,376 7,195,017
667,383 29,787,175
11,856,552 3,109,653
186,187,334
-26,386,084

$

11

$

$ 513,698

-40,000

$ -473,698

$

-39,989 $ 513,698 $ -473,698 $

$ -445,951 $ -23,974,379 $ -1,965,743 $

14,692,520

82,148,829

7,497,054

11 513,698 -513,698
11
-26,386,073
104,338,403

$ 14,246,569 $ 58,174,450 $ 5,531,311 $-=~.,;7.;_7,~95;;;:2:,:;,3~3,;;,.0

The notes to the basic financial statements are an integral part of this statement. -6-

CARROLL COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2008

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
Revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.
Property Taxes
In the Statement of Activities, the gain or loss on the sale or retirement of buildings and equipment is reported, whereas in the Governmental Funds, only proceeds from a sale increase financial resources. Thus, the change in net assets differs from the change in fund balances by the carrying value of the building and equipment sold or retired.
The issuance of Long-Term Debt provides current financial resources to governmental funds, while the repayment of the principal on Long-Term Debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net assets. This amount is the net effect of these differences in the treatment of Long-Term Debt and related items.
Principal Payments - Bonds Principal Payments - Capital Leases Bond Premium Amortization Expense
Total Long-Term Debt
Some expenses 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.
Change in Compensated Absences Change in Accrued Interest

$ -26,386,073

$ 27,296,535 -3,086,668

24,209,867

33,608

-90,200

$ 11,510,000 346,552 466,156

12,322,708

$

-82,376

-421,741

-504,117

Change in Net Assets of Governmental Activities {Exhibit "B")

$ ==9,=58=5=,7=9=3

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

CARROLL COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET ASSETS
FIDUCIARY FUNDS JUNE 30, 2008

EXHIBIT"G"

ASSETS Cash Investments
Total Assets
LIABILITIES Funds Held for Others
NET ASSETS Held in Trust for Private Purposes
Total Liabilities and Net Assets

PRIVATE PURPOSE TRUSTS

AGENCY FUNDS

$

2,283 $

467,488

36,623

11,000

$

38,906 $ =====4=7=8,=4=8=8=

$

478,488

$ _ _ _3~8,_90_6_

$

38,906 $ =====4=7=8,=4=8=8=

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

CARROLL COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
FIDUCIARY FUNDS YEAR ENDED JUNE 30, 2008

EXHIBIT "H"

ADDITIONS Investment Earnings Interest
DEDUCTIONS None Noted Change in Net Assets
Net Assets - Beginning
Net Assets - Ending

PRIVATE PURPOSE TRUSTS

$

1,376

$

0

$

1,376

37,530

$ ==3=8=,9=06=

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

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
Reporting Entity
The Carroll County Board ofEducation (the "School District") was established under the laws ofthe State of Georgia and operates under the guidance of a School Board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the 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 Carroll County Board of Education.
District-wide Statements: The Statement ofNet Assets and the Statement ofActivities display information about the financial activities ofthe overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting ofinternal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange 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 ofthe 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 ofgoods 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 ofinternal 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.

- 10 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The School District reports the following major governmental funds:
General Fund is the School District's primary operating fund. It accounts for all financial resources ofthe School District, except those resources required to be accounted for in another fund.
District-wide Capital Projects Fund accounts for financial resources including Special Purpose Local Option Sales Tax (SPLOST), Bond Proceeds and grants from Georgia State Financing and Investment Commission to be used for the acquisition, construction or renovation ofmajor capital facilities.
Debt Service Fund accounts for taxes (sales) legally restricted for the payment ofgeneral longterm principal, interest and paying agent's fees.
The School District reports the following fiduciary fund types:
The Private Purpose Trust Fund reports a trust arrangement under which principal is to be invested and preserved intact with the resultant income to be used to assist State University of West Georgia juniors and seniors who have committed to a career in education or to veteran teachers who are returning to school to upgrade their teaching credentials.
Agency Funds account for assets held by the School District as an agent for various funds, governments or individuals.
Basis of Accounting
The basis ofaccounting determines when transactions are reported on the financial statements. The District-wide governmental and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless ofwhen the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, 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 is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.

- 11 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis ofaccounting. 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, except for principal and interest on general long-term debt and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources.
The School District funds certain programs by a combination ofspecific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets 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.
Cash and Cash Equivalents
COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated Section 45-8-14 authorize 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.
Investments
COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates ofdeposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code ofGeorgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,

- 12 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

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

(5) Prime banker's acceptances,

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

(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 ofcredit 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 Carroll County Board ofCommissioners fixed the property tax levy for the 2007 tax digest year (calendar year) on July 24, 2007 (levy date). Taxes were due on December I, 2007 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2007 tax digest are reported as revenue in the governmental funds for fiscal year 2008. The Carroll County Tax Commissioner bills and collects the property taxes for the School District, withholds 1% 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, 2008, for maintenance and operations amounted to $35,016,827.

The tax millage rate levied for the 2007 tax year (calendar year) for the Carroll County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

18.10 mills

- 13 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Sales Taxes

Special Purpose Local Option Sales Tax, at the fund reporting level, during the year amounted to $12,766,992 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years.

Inventories

FOOD INVENTORIES On the basic financial statements, inventories ofdonated food commodities used in the preparation ofmeals 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 ofassets 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.

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

$

$ $
5,000 to $

All 10,000 10,000 10,000

NIA 20 to 80 years 20 to 80 years
3 to 20 years

Depreciation is used to allocate the actual or estimated historical cost of all capital assets over estimated useful lives.

- 14 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Compensated Absences

Members ofthe Teachers Retirement System ofGeorgia (TRS) may apply unused sick leave toward early retirement. The liability for early retirement will be borne by TRS rather than by the individual school districts. Otherwise, sick leave does not vest with the employee, and no liability is reported in the School District's financial statements.

Vacation leave is awarded on a fiscal year basis to all full time personnel employed on a twelve month basis, according to the following guidelines:

Classified Employees Certified Employees with 0-5 years experience in Carroll County Certified Employees with 6-10 years experience in Carroll County Certified Employees with 11 plus years experience in Carroll County

10 days per year 12 days per year 15 days per year 18 days per year

No other employees are eligible to earn vacation leave.

Vacation leave not utilized during the fiscal year may be carried over to the next fiscal year, providing such vacation leave does not exceed 20 days for Classified Employees and 25 days for Certified Employees.

General Obligation Bonds

The School District issues general obligation bonds to provide funds for the acquisition and construction ofmajor capital facilities. In the District-wide financial statements, bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life ofthe bonds using the straight-line method. Bond issuance costs are reported as deferred charges and amortized over the term of the debt.

In the fund financial statements, the School District recognizes bond premiums and discounts, as well as bond issuance costs during the fiscal year bonds are issued. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. General obligation bonds are direct obligations and pledge the full faith and credit of the government. The outstanding amount of these bonds is recorded in the Statement ofNet Assets.

Net Assets

The School District's net assets in the District-wide Statements are classified as follows:

- 15 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Invested in capital assets, net of related debt - This represents the School District's total investment in capital assets, net ofoutstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of invested in capital assets, net of related debt.
Restricted net assets - These represent resources for which the School District is legally or contractually obligated to spend resources for bus replacement, continuation of Federal programs, debt service and capital projects in accordance with restrictions imposed by external third parties.
Unrestricted net assets - Unrestricted net assets represent resources derived from property taxes, sales taxes, grants and contributions not restricted to specific programs, charges for services, and . miscellaneous revenues. These resources are used for transactions relating to the educational and general operations of the School District, and may be used at the discretion of the Board to meet current expenses for those purposes.
Note 3: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. Ifa depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. At June 30, 2008, $1,162 of deposits were not secured by surety bond, insurance or collateral as specified above.
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,

- 16 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 3: DEPOSITS

(5) Bonds of any public authority created by the laws ofthe State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,

(6) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia, and

(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

At June 30, 2008, the bank balances were $84,781,830. The amounts of the total uninsured bank balances are classified into three categories of custodial credit risk:

Category 1 - Uncollateralized, Category 2 - Cash collateralized with securities held by the pledging financial institution, or Category 3 - 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 uninsured deposits are classified by custodial credit risk category at June 30, 2008, as follows:

Custodial Credit Risk Category

Bank Balance

1

$

1,162

2

0

3

84,246,047

Total

$ 84,247,209

Note 4: 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

Note 5: CAPITAL ASSETS

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

- 17 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 5: CAPITAL ASSETS

Balances July 1, 2007

Increases

Balances Decreases June 30, 2008

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

$ 6,671,205 $

681,238

$ 7,352,443

15,059,894 22,164,786 $ 22,532,876 14,691,804

Total Capital Assets Not Being Depreciated $ 21,731,099 $ 22,846,024 $ 22,532,876 $ 22,044,247

Capital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements

$ 109,078,654 $ 25,968,682 $

14,963,769

1,014,705

6,436,692

234,400 $ 134,812,936 464,859 15,513,615
6,436,692

Less Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements

20,692,623 9,297,897 4,007,669

1,843,520 956,954 286,194

153,510 455,549

22,382,633 9,799,302 4,293,863

Total Capital Assets, Being Depreciated, Net $ 96,480,926 $ 23,896,719 $

90,200 $ 120,287,445

Governmental Activity Capital Assets - Net $ 118,212.025 $ 46.742.743 $ 22,623.076 $ 142,331.692

Capital assets being acquired under capital leases as of June 30, 2008, are as follows:

Governmental Funds

Equipment Less: Accumulated Depreciation

$ 603,850 48.825

Current year depreciation expense by function is as follows:

$=====5==55'='=,0==2==5

Instruction Support Services
Educational Media Services General Administration Maintenance and Operation of Plant Student Transportation Services Food Services

$ 2,065,888

$ 104,936 25,046 44,275
671.629

845,886 174 894

$ 3,086,668

- 18 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 6: RESTRICTED ASSETS

Special Purpose Local Option Sales Tax (SPLOST) and general obligation bond proceeds are restricted assets in the Statement of Net Assets because their use is limited by applicable bond covenants or statutory provisions. Restricted assets at June 30, 2008, were as follows:

District-wide Capital Projects Bond Proceeds

Debt Service Funds

Restricted Cash and Cash Equivalents: Debt Services Capital Acquisitions

$ 3,291,217 $ 57,567,490

Note 7: INTERFUND TRANSFERS

Interfund transfers for the year ended June 30, 2008, consisted of the following:

Transfer to

Transfers From

General

Debt Service

Fund

Fund

District-wide Capital Projects

$

40,000 $====4-73='=.6==9==8

Transfers are used to move property tax revenues collected by the General Fund to the District-wide Capital Projects Fund to cover the cost ofconstruction on Local Projects. In addition, transfers are used to move excess Special Purpose Local Option Sales Tax (SPLOST) revenue collected in the Debt Service Fund to the District-wide Capital Projects fund to cover the cost of construction on projects approved by the School District's SPLOST resolution.

Note 8: 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 participates in the Georgia School Boards Association Risk and Insurance Management System, a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to

- 19 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 8: RISK MANAGEMENT

administer one or more groups of self-insurance funds, including the processing and defense of claims brought against members ofthe system. The School District pays an annual premium to the system for its general insurance coverage. Additional coverage is provided through agreements by the system with other companies according to their specialty for property, boiler and machinery (including coverage for flood and earthquake), general liability (including coverage for sexual harassment, molestation and abuse), errors and omissions, crime and automobile risks. Payment of excess insurance for the system varies by line of coverage.

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 ofthat 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

EndofYear Liability

2007 2008

$

0 $

920 $

920 $

0

$

0 $

7 634 $

7 634 $

0

The School District participates in the Georgia School Boards Association Workers' Compensation Fund, a public entity risk pool organized on July 1, 1992, to develop, implement, and administer a program ofworkers' compensation self-insurance for its member organizations. The School District pays an annual premium to the Fund for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Fund with the Safety National Casualty Corporation to provide coverage for potential losses sustained by the Fund in excess of $400,000 loss per occurrence, up to $1,000,000.

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

Position Covered

Amount

Superintendent Each Principal and Assistant Principal All Other Employees

$ 100,000

$

20,000

$ 100,000

-20-

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 9: LONG-TERM DEBT

CAPITAL LEASES The Carroll County Board of Education has entered into various lease agreements as lessee for copiers and mobile classroom units. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception.

COMPENSATED ABSENCES Compensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. Typically, the General Fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences.

Changes in the compensated absences liability for the last three fiscal years are as follows:

Beginning ofYear Liability

Additions

Deductions

EndofYear Liability

2006 2007 2008

$ 546,776 $ 479 877 $ 463,364 $ 563,289 $ 563,289 $ 435,339 $ 449 487 $ 549 141 $ 549,141 $ 496,324 $ 413,948 $ 631,517

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

Purpose

Interest Rates

Amount

General Government - Series 2007

3.67% - 3.77 % $ 70,000,000

The changes in Long-Term Debt during the fiscal year ended June 30, 2008, were as follows:

- 21 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 9: LONG-TERM DEBT

Balance July 1, 2007
Additions Annual Leave Earned
Deductions Annual Leave Utilized Premium Amortization Debt Retired
Balance June 30, 2008
Portion of Long-Term Debt Due within One Year

Capital Leases

Governmental Funds

General

Compensated

Obligation

Absences

Bonds

Unamortized Bond
Premium

Total

$ 1,128,686 $ 549,141 $ 81,510,000 $ 2,289,768 $ 85,477,595

496,324

496,324

346,552

413,948

11,510,000

466,156

413,948 466,156 11,856,552

$ 182 134 $ 631,511 $ 1Q,QQQ,QQQ $ 1,823,612 $ 13,231,263

$ 312,742 $ 442,062 $ 11,720,000 $ 570,803 $ 13,045,607

At June 30, 2008, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30

Ca11ital Leases

Princi11al

Interest

2009 2010 2011 2012

$ 312,742 $ 307,318 133,071 29,003

33,535 17,607 5,429
259

Total Principal and Interest

$ 782,134 $

56,830

Fiscal Year Ended June 30

General Obligation

Debt

Principal

Interest

Unamortized Bond
Premium

2009 2010 2011 2012 2013

$ 11,720,000 $ 13,055,000 14,495,000 16,050,000 14,680,000

3,202,250 $ 2,733,450 2,141,250 1,445,450
708,200

570,803 487,239 381,679 257,652 126,239

Total Principal and Interest

$ 70,000,000 $ 10,230.600 $ 1,823,612

- 22 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 10: ON-BEHALF PAYMENTS

The School District has recognized revenues and costs in the amount of $3,072,393 for health insurance and retirement contributions paid on the School District's behalf by the following State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance ofNon-Certified Personnel In the amount of $3,018,693

Paid the Teachers Retirement System For Teachers Retirement (TRS) In the amount of$36,025

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $17,675

Note 11: SIGNIFICANT COMMITMENTS

The following is an analysis ofsignificant outstanding construction or renovation contracts executed by the School District as of June 30, 2008:

Project

Unearned Executed Contracts

Bowdon Elementary School Bowdon High School Gymnasium Central Elementary School Renovation Central High School Middle School Athletic Fields Mt. Zion Middle School Classroom Additions New Temple Elementary School Technical High School Temple Middle School Villa Rica High School Villa Rica Multi-Purpose Building

$ 751,451 32,250
6,454,430 9,517,582
155,379 1,627,942
164,063 67,375 57,000 41,964 738,654

$ 19,608.090

The amounts described in this note are not reflected in the basic financial statements.

- 23 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 12: 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 ofroutine School District operations. The ultimate disposition ofthese proceedings is not presently determinable, but is not believed to be material to the basic financial statements.

Note 13: POSTEMPLOYMENT BENEFITS

Georgia Retiree Health Benefit Fund

Plan Description. The School District contributes to the Georgia Retiree Health Benefit Fund ("GRHBF"), a cost-sharing multiple-employer defined benefit postemployment healthcare plan administered by the Department ofCommunity Health. GRHBF provides health insurance benefits to eligible retirees and their qualified beneficiaries. Pursuant to Title 45, Chapter 18 ofthe Official Code ofGeorgia Annotated, the authority to establish and amend the benefit provisions ofthe plan is assigned to the Board of Community Health. The Department of Community Health issues a publicly available financial report that includes financial statements and required supplementary information for GRHBF. That report may be obtained from the Department ofCommunity Health at 2 Peachtree Street, Atlanta, Georgia 30303.

Funding Policy. The contribution requirements of plan members and participating employers are established and may be amended by the Board of Community Health. Contributions of plan members or beneficiaries receiving benefits vary based on plan election, dependent coverage, and Medicare eligibility and election. On average, plan members pay approximately twenty-five percent (25%) of the cost of health insurance coverage.

Participating employers are statutorily required to contribute in accordance with the employer contribution rate established by the Board of Community Health. This contribution rate is established to fund both the active and retired employee health insurance plans based on projected pay-as-you-go financing requirements. The employer contribution rates for the combined active and retiree plans for the fiscal year ended June 30, 2008, were as follows:

Teachers Non-Certificated Employees

18.534% of state-based salaries $162.72 per month

The School District's contribution to the health insurance plans for the fiscal year ended June 30, 2008, was $12,416,074, which equaled the required contribution.

- 24 -

CARROLL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2008

EXHIBIT "I"

Note 14: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

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

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe School District who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The School District makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 9.28% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2008 2007 2006

100% 100% 100%

$ 7,094,149 $ 6,621,494 $ 5,517,336

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(This page left intentionally blank)

CARROLL COUNTY BOARD OF EDUCATION GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2008

SCHEDULE "1"

REVENUES
Property Taxes Other Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Food Services Operation Community Services Operation
Capital Outlay Debt Service
Principal Retirement Interest and Fiscal Charges
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES}
Proceeds from Capital Leases Transfers In Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending

NONAPPROPRIATED BUDGETS

ORIGINAL (1)

FINAL (1)

ACTUAL AMOUNTS

VARIANCE WITH FINAL BUDGET

$

32,987,038 $

32,987,038 $

35,016,827 $

3,557,728

3,557,728

1,292,994

80,797,667

84,319,044

87,722,403

4,673,717

12,253,569

11,464,243

2,443,562

2,373,562

4,447,631

700,000

740,000

631,818

177,000

207000

2 003 741

$ 125,336,712 $ 136 437 941 $ 142,579,657 $

2,029,789 -2,264,734 3,403,359
-789,326 2,074,069
-108, 182 1 796 741
6,141,716

$

79,951,689 $

84,567,016 $

88,685,189 $

2,534,123 2,117,088 2,767,236
762,401 8,933,747
755,807 9,119,255 8,198,904
955,985 192,472
7,267,741
572,363

4,181,138 3,605,652 2,767,236 1,688,792 8,933,747
756,807 9,119,255 8,301,675
955,985 268,388
7,267,741 51,510
592,363

4,134,276 3,040,360 2,769,439 2,589,290 9,488,901
825,018 9,113,421 8,636,771 1,135,961
558,208 2,594,376 7,195,017
667,383 1,143,025

346,552 62432

$ 124,128,811 $ 133,057,305 $ 142,985,619 $

$

1207901 $

3,380,636 $

-405 962 $

-4,118,173
46,862 565,292
-2,203 -900,498 -555,154
-68,211 5,834
-335,096 -179,976 -289,820 -2,594,376
72,724 -615,873 -550,662
-346,552 -62 432
-9,928,314
-3,786,598

$

$

311,076 $

311,076

-1,407,055

-1 407,055

$

-1,095,979 $

-1,095,979 $

$

111,922 $

2,284,657 $

14,692,520

14,692,520

11 $ -40 000 -39 989 $ -445,951 $ 14,692,520

11 -311,076 1 367,055
1,055,990
-2,730,608
0

$

14,804,442 $

16,977,177 $

14,246,569 $

-2,730,608

Notes to the Schedule of Revenues, Ex11enditures 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 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.

-27 -

CARROLL COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2008

SCHEDULE "2"

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 Child Nutrition Cluster
Other Programs Pass-Through From Georgia Department of Education Food Donation (1)
Total U. S. Department of Agriculture
Corporation for National and Community Service Pass-Through From Georgia Department of Education Learn and Serve America School and Community Based Programs
Education, U.S. Department of 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 Career and Technical Education - Basic Grants to States Education for Homeless Children and Youth English Language Acquisition Grants Improving Teacher Quality State Grants State Grants for Innovative Programs Title I Grants to Local Educational Agencies
Total U.S. Department of Education
Defense, U.S. Department of Direct Department of the Army R.O.T.C. Program
Total Federal Financial Assistance
NIA = Not Available

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

* 10.553 * 10.555

NIA NIA $
$

(2) 6,448,457
6,448,457

10.550

NIA $

359,444 6,807,901

94.004

NIA $

7,000

84.027 84.173

NIA $ NIA
$

2,988,626 111,515
3,100,141

84.048 84.196 84.365 * 84.367 84.298 84.010

NIA NIA NIA
NIA NIA
NIA
$

130,797 32,662 49,019
562,562 21,011
2,957,359
6,853,551

$

31,820

$ ==1=3=7,=00=,2=7=2

- 28-

CARROLL COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2008

SCHEDULE "2"

Notes to the Schedule of Expenditures of Federal Awards
(1) The amount shown for the Food Donation Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the School District during the current fiscal year.
(2) Expenditures for the funds earned on the School Breakfast Program ($1,089,180) were not maintained separately and are included in the 2008 National School Lunch Program.
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 Carroll 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.

- 29 -

CARROLL COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2008

SCHEDULE "3"

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 Grades (6-8) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Program for Intellectually Gifted Students - 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 Indirect Cost Central Administration School Administration Facility Maintenance and Operations Categorical Grants Pupil Transportation Regular Bus Replacement Nursing Services Education Equalization Funding Grant Food Services Vocational Education Amended Formula Adjustment Other State Programs Charter Schools Drivers Education Graduation Coaches Health Insurance Middle School Summer Remedial Program National Teacher Certification Other State Grant Preschool Handicapped Program Teachers Retirement Virtual Schools Grant
Georgia State Financing and Investment Commission Reimbursement on Construction Projects

GOVERNMENTAL FUND TYPES

CAPITAL

GENERAL

PROJECTS

FUND

FUND

TOTAL

$ 2,454,103

$ 2,454,103

4,413,813 704,133
11,193,518 1,382,772 5,057,219 550,662 18,568 8,504,194 8,234,715 1,732,316 9,844,308 2,705,488 557,480 683,352 412,189 1,565,990 475,174 299,860
1,749,338 3,184,309 3,834,032
1,795,377 317,279 257,136
11,967,171 387,116 253,035
-1,293,521
10,000 126,965 581,608 3,018,693
17,555 52,399 185,926 297,682 36,025
5,900

4,413,813 704,133
11,193,518 1,382,772 5,057,219 550,662 18,568 8,504,194 8,234,715 1,732,316 9,844,308 2,705,488 557,480 683,352 412,189 1,565,990 475,174 299,860
1,749,338 3,184,309 3,834,032
1,795,377 317,279 257,136
11,967,171 387,116 253,035
-1,293,521
10,000 126,965 581,608 3,018,693
17,555 52,399 185,926 297,682 36,025
5,900

$ 1,501,948

1,501,948

- 30-

CARROLL COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2008

SCHEDULE "3"

AGENCY/FUNDING
GRANTS Human Resources, Georgia Department of Family Advocate Program Family Connection
Office of Treasury and Fiscal Services Public School Employees Retirement
OTHER Community Affairs, Georgia Department of Local Assistance Grant

GOVERNMENTAL FUND TYPES

CAPITAL

GENERAL

PROJECTS

FUND

FUND

TOTAL

$

60,851

49,998

17,675

$

60,851

49,998

17,675

20,000

20,000

$ 87,722,403 $ 1,501,948 $ 89,224,351

See notes to the basic financial statements.

- 31 -

CARROLL COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2008

SCHEDULE "4"

PROJECT
(A) Funding the acquisition, construction and equipping of capital ouUay projects, consisting of four (4) elementary schools, one (1) new middle school and two (2) new high schools, the acquisition of future school sites and additions, renovations, modifications and improvements at existing schools and facilities within the Carroll County School District and (B) Interest on the School District debt.
Providing funds to pay or to be applied toward the cost of capital outlay projects within the Carroll County School District, consisting of acquiring,
constructing, adding to,
renovating, modifying, repairing, improving and equipping existing schools and other buildings and facilities and acquiring any property necessary or desirable therefore, both real and personal; acquiring real estate for the construction of new schools and facilities; constructing and equipping new schools and facilities and acquiring any property necessary or desirable therefore, both real and personal.

ORIGINAL ESTIMATED
COST(1)

CURRENT ESTIMATED COSTS(2)

AMOUNT EXPENDED IN CURRENT
YEAR(3)

AMOUNT EXPENDED
IN PRIOR YEARS(3)

PROJECT STATUS

$

80,135,000 $

80,135,000 $ 12,307,014 $ 51,349,011 Ongoing

105,420,000

105,420,000

19,344,276

867,823 Ongoing

$ 185,555,000 $ 185,555.000 $ 31,651,290 $ 52,216,834

(1) The School Districfs original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax.
(2) The School Districfs current estimate of total cost for the projects. Includes all cost from project inception to completion.
(3) The voters of Carroll County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

See notes to the basic financial statements.

- 32-

CARROLL COUNTY BOARD OF EDUCATION GENERAL FUND- QUALITY BASIC EDUCATION PROGRAM (QBE)
ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2008

SCHEDULE "5"

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 Grades (6-8) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Category I Category II Category Ill Category IV CategoryV 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

$

5,061,304 $ 5,536,827 $

115,835 $

5,652,662

751,803

466,279

3,409

469,688

12,584,173

13,078,463

494,013

13,572,476

1,490,892

1,042,920

7,864

1,050,784

5,704,544

6,680,693

300,203

6,980,896

622,641 107,713 9,495,618 9,277,977 1,948,295 11,074,789
3,054,918 607,742 771,082 437,656

759,368 857,076 9,444,405 11,360,199 2,193,540
156,506 1,023,029 10,402,571
478,456 1,466,350 2,987,662
494,285 1,274,844
258,546

4,365 18,567 456,266 425,516 200,075
12,805 10,919 87,559 40,124 72,788 61,295
3,992 27,274
2 179

763,733 875,643 9,900,671 11,785,715 2,393,615
169,311 1,033,948 10,490,130
518,580 1,539,138 3,048,957
498,277 1,302,118
260,725

$

62,991,147 $ 69,962,019 $ 2,345,048 $

72,307,067

1,764,915 341,022

2,378,075 155,417

303,667 185,643

2,681,742 341 060

TOTAL QBE FORMULA FUNDS

$

65,097,084 $ 72,495,511 $ 2,834,358 $ ====75==,3=2=9'=86=9=

(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.

- 33 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

Russell W. Hinton
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
May 6, 2009

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Carroll County Board of Education
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 the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Carroll County Board of Education as of and for the year ended June 30, 2008, which collectively comprise Carroll County Board of Education's basic financial statements and have issued our report thereon dated May 6, 2009. 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.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Carroll County Board of Education's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose ofexpressing an opinion on the effectiveness of the Carroll County Board of Education's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Carroll County Board of Education's internal control over financial reporting.
A control deficiency exists when the design or operation ofa control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affect the Carroll County Board ofEducation's ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted
2008YB-10

accounting principles such that there is more than a remote likelihood that a misstatement of the Carroll County Board ofEducation's financial statements that is more than inconsequential will not be prevented or detected by the Carroll County Board of Education's internal control.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement ofthe financial statements will not be prevented or detected by the Carroll County Board of Education's internal control.
Our consideration of the internal control over financial reporting was for the limited purpose described in the first paragraph ofthis section and would not necessarily disclose all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Carroll County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, 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.
This report is intended solely for the information and use of management, members of the Carroll County Board of Education, others within the entity, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
~~~
Ru ell W. Hinton, CPA, CGFM State Auditor
RWH:as 2008YB-10

Russell W. Hinton
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
May 6, 2009

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Carroll County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133
Ladies and Gentlemen:
Compliance
We have audited the compliance ofCarroll County Board ofEducation with the types ofcompliance requirements described in the U.S. Office of Management and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 2008. Carroll County Board of Education's major Federal programs are identified in the Summary of Auditor's Results Section ofthe accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Carroll County Board of Education's management. Our responsibility is to express an opinion on Carroll County Board of Education's compliance based on our audit.
We conducted our audit ofcompliance in accordance with auditing standards generally accepted in the United States ofAmerica; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States; and 0MB Circular A133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and 0MB 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 Carroll County Board ofEducation's compliance with those requirements and performing such other procedures as we considered necessary in the

2008SA-10

circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Carroll County Board of Education's compliance with those requirements.
In our opinion, the Carroll County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each ofits major Federal programs for the year ended June 30, 2008.
Internal Control Over Compliance
The management of Carroll County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Carroll County Board ofEducation's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose ofexpressing our opinion on compliance, but not for the purpose ofexpressing an opinion on the effectiveness ofinternal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the Carroll County Board of Education's internal control over compliance.
A control deficiency in an entity's internal control over compliance exists when the design or operation ofa control does not allow management or employees, in the normal course ofperforming their assigned functions, to prevent or detect noncompliance with a type ofcompliance requirement of a Federal program on a timely basis. A significant deficiency is a control deficiency, or combination ofcontrol deficiencies, that adversely affects the entity's ability to administer a Federal program such that there is more than a remote likelihood that noncompliance with a type of compliance requirement of a Federal program that is more than inconsequential will not be prevented or detected by the entity's internal control.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that material noncompliance with a type of compliance requirement of a Federal program will not be prevented or detected by the entity's internal control.
Our consideration of the internal control over compliance was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above.
2008SA-10

This report is intended solely for the information and use of management, members ofthe Carroll County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.

Respectfully submitted,

...

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Ru ell W. Hinton, CPA, CGFM State Auditor

RWH:as 2008SA-10

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

CARROLL COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2008

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-6221-07-01

Previously Reported Corrective Action Implemented

PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER

AUDITEE'S RESPONSE/STATUS

SEE AUDITOR'S COMMENTS

F A-6221-06-01

Unresolved

(1)

AUDITOR'S COMMENTS

(1) Funding for the Hurricane Education Recovery program was a one year grant. Georgia Department ofEducation is reviewing this matter to determine ifthese funds were used properly or if a refund is appropriate.

SECTION IV FINDINGS AND QUESTIONED COSTS

CARROLL COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2008
I SUMMARY OF AUDITOR'S RESULTS
1. Type of Report Issued on the Financial Statements The auditor's opinion on the Carroll County Board ofEducation's financial statements was unqualified.
2. Significant Deficiencies in Internal Control Disclosed by the Audit ofthe Financial Statements The audit report for the Carroll County Board ofEducation did not disclose any significant deficiencies related to the financial statements.
3. Noncompliance Material to the Financial Statements The audit of the Carroll County Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements.
4. Significant Deficiencies in Internal Control Over Major Programs The audit report for the Carroll County Board ofEducation did not disclose any significant deficiencies in internal control over major programs.
5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Carroll County Board ofEducation's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be Reported by Section .510(a) ofOMB Circular A-133 The Carroll County Board ofEducation's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-133.
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food Services - School Breakfast Program 10.555 Food Services - National School Lunch Program 84.367 Improving Teacher Quality State Grants
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $411,008.
9. Low Risk Auditee The Carroll County Board of Education did not qualify as a low risk auditee as defined by Section .530 ofOMB Circular A-133.
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CARROLL COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2008 II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
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