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AUDIT REPORT CATOOSA COUNTY BOARD OF EDUCAnON
RINGGOLD, GEORGIA YEAR ENDED JUNE 30, 1997
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

CATOOSA COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

5

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

6

ADDITIONAL FINANCIAL INFORMAnON

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

16

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

17

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

18

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

20

I

FIDUCIARY FUND TYPE

COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUNDS

22

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

23

2 SCHEDULE OF STATE REVENUE

25

3 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAMS

26

4 SCHEDULE OF SPECIAL PURPOSE LOCAL OPTION SALES TAX FUNDS

27

CATOOSA COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

5

OVERALL

29

6

BY PROGRAM

30

SECTIONll
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-B3

SECTION ill SUMMARY OF AUDITOR'S RESULTS SUMMARY SCHEDULE OF AUDITOR'S RESULTS

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

CATOOSA COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
SECTION V CURRENT YEAR FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS
SECTION VI PERTINENT VIEWS OF RESPONSffiLE OFFICIALS PERTINENT VIEWS OF RESPONSffiLE OFFICIALS

SECTION I FINANCIAL

CLAUDE L. VICKERS
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
February 17, 1998

Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Catoosa County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general-purpose financial statements of the Catoosa County Board of Education, as of and for the year ended June 30, 1997, as listed in the table of contents. These generalpurpose financial statements are the responsibility of the Catoosa County Board of Education's management. Our responsibility is to express an opinion on these general-purpose fmancial statements based on our audit.
Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1997, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.
As described in the notes to the general-purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:

97ARL-13

* The general-purpose financial statements of the Board did not contain a General Fixed Assets
. Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the general-purpose
financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general-purpose financial statements.
* The Board did not recognize as expenditures, in the year ended June 30, 1997, a portion of salaries
and the corresponding employer's cost ofrelated benefits earned for contractual services completed prior to June 30, 1997. Also funds received, subsequent to June 30, 1997, from the Georgia Department of Education for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1996, were improperly recorded in the year ended June 30,1997. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general-purpose fmancial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects of such adjustments, if any, on the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the food service inventories as discussed in the third paragraph, and except for the effects on the general-purpose financial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the fmancial position of the Catoosa County Board ofEducation as of June 30, 1997, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated February 17, 1998, on our consideration ofthe Catoosa County Board ofEducation's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Catoosa County Board of Education taken as a whole. The accompanying combining statements (Exhibits E through I) and the financial schedules (Schedules 1 through 6), 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, andNon-Profit Organizations, are presented for purposes of additional
analysis and are not a required part of the general-purpose fmancial statements. Such information has been subjected to the auditing procedures applied in the audit of the general-purpose financial statements and in our opinion, except for the effect of adjustments, if any, on the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the food service inventories as discussed in the third paragraph, and except for the effects of the matters referred to in the fourth paragraph, such information is fairly presented in all material respects in relation to the general-purpose financial statements taken as a whole.
97ARL-13

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,
~
Claude L. Vickers State Auditor
CLV:gp 97ARL-13

CATOOSA COUNTY BOARD OF EDUCAnON

CATOOSA COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30,1997

ASSETS
Cash and Cash Equivalents
Accounts Receivable
Due from Other Funds
Inventories Food Donated Commodities Purchased Food

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

$ 2,949,113.10 $ 1,032,328.65 $ 425,158.90

184,439.48

137,213.15

46,846.00

43,185.06 21,660.04

Total Assets

$ 3,180,398.58 $ 1.234.386.90 $ 425,158.90

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payable Due to Other Funds Funds Held for Others
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For State Capital Outlay Projects Unreserved Deficit Undesignated
Total Fund Equity

$

4,813.94 $ 69,321.64 $

2,680.54

242,131.30

5.504.49

134,027.00

80.566.70

46,846.00

$

4,813.94 $ 316,957.43 $ 264,120.24

$ 14,040,01

$

7,987.21

43,185,06 21,660.04
$

272,919.17

3,167,597.43

838,544.36

.-111,880.51 0.00

$ 3,175,584.64 $ 917,429.47 $ 161,038.66

Total Liabilities and Fund Equity

$ 3,180,398.58 $ 1,234,386.90 $ 425,158.90

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

EXHIBIT"A"

FIDUCIARY FUND TYPE AGENCY FUNDS

TOTALS (Memorandum Only) JUNE 30,1997 JUNE 30,1996

$

530.06 $ 4,407,130.71 $ 3,140,168.09

321,652.63

645,024.61

46,846.00

43,185.06 21,660.04

48,620.12 24,888.78

$

530.06 $ 4,840,474.44 $ 3,858,701.60

$

76,816.12 $

69,097.85

242,131.30

238,645.01

5,504.49

10,599.35

134,027.00

80,566.70

46,846.00

$

530.06

530.06

716.86

$

530.06 $ 586,421.67 $ 319,059.07

$

14,040.01 $

17,707.82

7,987.21

7,987.21

43,185.06 21,660.04 272,919.17

48,620.12 24,888.78 510,922.01

-111,880.51 4,006,141.79

2,929,516.59

$ 4,254,052.77 $ 3,539,642.53

$

530.06 $ 4,840,474.44 $ 3,858,701.60

- 3-

CATOOSA COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1997

EXHIBIT"B"

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

CATOOSA COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30.1997

EXHIBIT"C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 26,602,834.00 $ 27,643,327.36

144,564.00

67,878.43

9,856,142.00 10,448,487.52

82,000.00

708,685.64

Total Revenues

$ 36,685,540.00 $ 38,868,378.95

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Admlnistration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations
Capital Outlay

$ 24,414,638.00 $ 24,789,751.52

1,363,693.00 572,227.00
1,191,584.00 355,798.00
3,204,745.00 376,923.00
2,814,084.00 1,516,752.00
431,852.00 17,312.00
275,073.00

1,456,247.26 538,606.75
1,154,114.82 357,105.46
3,247,195.73 390,310.47
2,911,561.90 1,682,082.86
417,442.59 27,965.84 222.02
213,156.85 255,680.66

Total Expenditures

$ 36,534,681.00 $ 37,441,444.73

Excess of Revenues over (under) Expenditures $

150,859.00 $ 1,426,934.22

OTHER FINANCING USES

Other Uses

$ -390,476.20

Excess of Revenues over (under) Expenditures

and Other Financing Uses

$

150,859.00 $ 1,036,458.02

FUND BALANCE JULY 1. 1996

2,100,364.62

2,139,126.62

Adjustments Food Inventory - Net Change in Period
Donated Commodities Purchased Food

FUND BALANCE JUNE 30,1997

$ 2,251,223.62 $ 3,175,584.64

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$

357,304.00 $

571,571.81

1,910,052.00

2,336,208.30

1,163,340.00

1,229,584.94

$ 3,430,696.00 $ 4,137,365.05

$

850,524.00 $ 1,149,969.14

87,688.00 17,460.00
59,277.00

125,016.11 51,110.75 10,478.43 78,304.89

350.00 69,353.00
6,468.00 2,339,576.00

507.68 97,554.23
13,434.47 2,564,019.93
10,470.05

$ 3,430,696.00 $ 4,100,865.68

$

0.00 $

36,499.37

$

0.00 $

36,499.37

883,928.86

889,593.90

811.03

-5,435.06 -3,228.74

$

884,739.89 $ =====9=1=7=,4=2~9=.4=7=

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

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Catoosa County Board of Education (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the Board is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The Board 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.
General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Board. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these fmancial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control of the Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most ofa Board's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources ofthe Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds ofspecific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal govemrnent to accomplish specific educational objectives.

- 6-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
FIDUCIARY FUND TYPE - the funds used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include:
AGENCY FUNDS - the funds used to account for assets held in a fiduciary capacity for other funds, governments, or individuals.
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds.
Agency funds are purely custodial in nature and do not involve measurement of results of operations.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Those revenues considered susceptible to accrual are property taxes, intergovernmental grants and investment income. Property taxes are considered available if they are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 1997, a substantial number of personnel ofthe Board were employed for a one hundred and ninety day period beginning in late August 1996 and ending in early June 1997. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1996 and ending in August 1997. State
-7-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As of June 30, 1997, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1997, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1997. Also, the State's portion of the compensation paid in July and August 1997 was received and recorded as revenue in the fiscal year subsequent to June 30, 1997. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1996, were recorded in the year ended June 30, 1997. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities.
BUDGET
The Catoosa County Board of Education's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting ofthe Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This fmal budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department ofEducation. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQillVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. The placement of proceeds from bond issues in certificates of deposit is limited to financial institutions located within this State.

-8-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

RECEIVABLES

Receivables consist of 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 general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.

PROPERTY TAXES

The Catoosa County Board of Commissioners fixed the property tax levy for the 1996 tax year (calendar year) on August 13, 1996 (levy date). Taxes were due on December 20, 1996. The lien date for property taxes was January 1, 1996. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1997 since their collection meets the criteria of GASB codification section P70.1 03. The Catoosa County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the Board.

The tax millage rate levied for the 1996 tax year (calendar year) for the Catoosa County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

14.999 mills

INVENTORIES

FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

INTERFUND TRANSACTIONS

The Board has the following types of interfund transactions:

Reimbursements of expenditures initially made from a fund that are properly applicable to another fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.

- 9-

CATOOSA COUNTY BOARD OF EDUCATION

EXHillIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Operating transfers are recorded for all interfund transactions other than reimbursements.

MEMORANDUM ONLY - TOTAL COLUMNS

Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. Certain reclassifications have been made to the comparative data to conform to the current year classifications.

DEFICIT FUNDBALANCES

Funds reporting a deficit fund balance position at June 30, 1997, which are not readily apparent on the general purpose financial statements are as follows:

Fund Type/Fund Name

Deficit Balances

Capital Projects Fund Special Purpose Local Option Sales Tax Lottery Proj ect

$ 46,846.00 $ 65,034.51

These deficit balances will be funded with Special Purpose Local Option Sales Tax proceeds in future periods.

Note 2: DEPOSITS

COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by
surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond
and the market value ofsecurities shall be equal to not less than 11 percent ofthe public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.

Acceptable security for deposits consists of anyone of or any combination of the following:

(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,

(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,

- 10-

CATOOSA COUNTY BOARD OF EDUCAnON

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 2: DEPOSITS

(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,

(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,

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

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

(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and 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.

CATEGORIZAnON OF DEPOSITS At June 30, 1997, the bank balances were $6,695,903.08. The amounts of the total bank balances are classified into three categories of credit risk:

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

The Board's deposits are classified by risk category at June 30, 1997, as follows:

Risk Category

Bank Balance

1 2 3
Total

$ 200,000.00 6,495,903.08 0.00
$ 6,695,903.08

- 11 -

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 3: NON-MONETARY TRANSACTIONS

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

Note 4: INTERFUND ASSETS AND LIABILITIES

Due to and due from other funds are recorded for interfund receivables and payables which arise from interfund transactions. The following analysis summarizes the status ofall interfund transactions ofthe Board at June 30, 1997:

Due From Other Funds

Due To Other Funds

General Fund Capital Projects Fund
Special Purpose Local Option Sales Tax

$ 46,846.00 $ 46,846.00

$ 46.846.00 $ 46.846.00

Note 5: RISK MANAGEMENT

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

The Board has obtained commercial insurance for risk ofloss associated with torts, assets, errors or omissions and natural disaster. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any of the past three years.

The Board has established a limited risk management program for workers' compensation claims. The Board accounts for claims within the same fund that the employee's salary and benefits were paid. Claims are accounted for with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $225,000.00 loss per occurrence, up to the statutory limit.

Changes in the workers' compensation claims liability during the last two fiscal years are as follows:

- 12-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 5: RISK MANAGEMENT

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

1996 1997

$

0.00 $ 110.536.48 $ 110,536.48 $

0.00

$

0.00 $

78.368.47 $

78,368.47 $

0.00

The Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the same fund that the employee's salary and benefits were paid. Claims are accounted for with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated.

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

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

1996 1997

$

0.00 $

4.465.00 $

4.465.00 $

0.00

$

0.00 $

2,352.20 $

2,352.20 $

0.00

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

Position Covered

Amount

Superintendent All Employees

$ 25,000.00 $ 35,000.00

Note 6: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of $587,439.54 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.

Georgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance of Non-Certified Personnel In the amount of $487,822.01

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$9,288.53

- 13-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 6: ON-BEHALF PAYMENTS

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 $90,329.00

Note 7: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the Board as of June 30, 1997, together with funding available:

Project
GSFIC 93/94-623-012 GSFIC 97-623-005

Unearned Executed Contracts

Funding Available From State

$ 156,120.22 10.402.46 $ 27,884.90

$ 166.522.68 $ 27,884.90

The amounts described in this note are not reflected in the general purpose fmancial statements.

Note 8: CONTINGENT LIABILITIES

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

Note 9: 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.

- 14-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30.1997

Note 9: RETIREMENT PLANS

TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11.81% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1997 1996 1995

100% 100% 100%

$ 2,785,754.61 $ 2,538,613.53 $ 2,374,578.85

- 15 -

CATOOSA COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 1997

EXHIBIT"E"

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

SCHOOL FOOD
SERVICES FUND

LOTIERY

FEDERAL

TOTALS

PROGRAMS PROGRAMS JUNE 30,1997 JUNE 30,1996

$ 997,637,26 $ 38,394,32

$ 1,036,031.58 $ 987,425.11

6,180.64

$ 131,032,51

137,213.15

147,421.09

43,185.06 21,660,04

43,185.06 21,660.04

48,620.12 24,888.78

Total Assets

$ 1,068,663,00 $ 38,394,32 $ 131,032.51 $ 1,238,089.83 $ 1,208,355.10

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity

$ 33,464.84 $ 131,808.70
$ 165,273.54 $

$ 9,365.56 29,028,76

3,702,93 $ 26,491.24 81,293.84
5,504.49

38,394.32 $ 116,992.50 $

$ 43,185,06 21,660.04
838,544.36 $
$ 903,389.46 $

$ 14,040.01 $

0.00 0,00 $

0,00 14,040.01 $

3,702,93 $ 69,321.64 242,131.30
5,504.49 320,660,36 $
14,040.01 $
43,185.06 21,660.04 838,544.36 917,429,47 $

10,364.08 60,975.20 238,645.01
8,776.91 318,761.20
17,707.82
48,620.12 24,888.78 798,377.18 889,593,90

Total Liabilities and Fund Equity

$ 1,068,663.00 $ 38,394.32 $ 131,032,51 $ 1,238,089,83 $ 1,208,355,10

See notes to the general purpose financial statements.

-16 -

CATOOSA COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30,1997

EXHIBIT"F"

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation Community Services Operations
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTIERY PROGRAMS

FEDERAL PROGRAMS

TOTALS YEAR ENDED JUNE 30,1997 JUNE 30,1996

$ 189,836,00 $
1,184,393.27 1,229,584,94

381,735,81

$

$ 1,151,815.03

571,571.81 $
2,336,208.30 1,229,584.94

497,216.86 2,236,613.46 1,078,406.78

$ 2,603,814.21 $ 381,735.81 $ 1,151,815.03 $ 4,137,365.05 $ 3,812,237.10

$ 323,517,71 $ 826,451.43 $ 1,149,969,14 $ 1,010,206.51

$ 2,563,647.03

35,412.55
22,432.65 372.90

89,603.56 51,110.75 10,478.43 78,304.89
507.68 75,121,58 13,434.47
10,470.05

125,016,11 51,110,75 10,478.43 78,304.89
507.68 97,554.23 13,434.47 2,564,019.93 10,470.05

170,200.33 37,836.31 12,646.54 67,125.34 712,27 2,053.96 81,633.23 24,851.60
2,366,090.40 5,750.67

$ 2,563,647,03 $ 381,735.81 $ 1,155,482.84 $ 4,100,865.68 $ 3,779,107.16

$ 40,167.18 $

0.00 $ -3,667.81 $

36,499.37 $

33,129,94

871,886.08

0.00

17,707.82

889,593.90

872,523.40

-5,435.06 -3,228.74

-5,435.06 -3,228.74

-12,954.25 -3,105.19

FUND BALANCE JUNE 30

$ 903,389.46 $ _ _.....;,0;,;,.0.=0 $ 14,040.01 $ 917,429.47 $ 889,593.90

See notes to the general purpose financial statements.

-17 -

CATOOSA COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 3D, 1997

ASSETS Cash and Cash Equivalents Accounts Receivable

REGULAR

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

0.00 $

277,394.90

Total Assets
LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Contracts Payable Retainages Payable Due to Other Funds
Total Liabilities
FUND EQUITY
Fund Balances Reserved For State Capital Outlay Projects Unreserved Deficit Undesignated
Total Fund Equity
Total Liabilities and Fund Equity

$

0.00 $=====2=77=,3=9=4.=90=

$

1,973.13

98,656.50

32,628.10

$

133,257.73

$

144,137.17

$

0.00

0.00

$

0.00 $

144,137.17

$

0.00 $ ======2=77=,=39=4=.=90=

See notes to the general purpose financial statements. -18-

EXHIBIT"G"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

$

0.00 $

LOTIERY PROJECT

TOTALS JUNE 30, 1997 JUNE 3D, 1996

147,764.00 $

425,158.90 $

510,922.01

226,475.18

$

0.00 $

147,764.00 $

425,158.90 $ ======7=3=7=0,3.=9=7=.=1=9=

$

$

46,846.00

$

46,846.00 $

707.41 $ 35,370.50 47,938.60
84,016.51 $

$ 2,680.54 134,027.00 80,566.70 46,846.00
264,120.24 $

226,475.18 226,475.18

$

$

-46,846.00

0.00

$

-46,846.00 $

128,782.00 $
-65,034.51 0.00
63,747.49 $

272,919.17 $

510,922.01

-111,880.51

0.00

0.00

161,038.66 $_--=;.51.0.,:9.2=2..0=1~

$

0.00 $

147,764.00 $

425,158.90 $ ======::7:::3:i:7::,!:3=9==7:=.1==9=

- 19 -

CATOOSA COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30. 1997

REVENUES State Funds
EXPENDITURES Capital Outlay Land and Land Improvements Building and Building Improvements Total Expenditures
Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES
Operating Transfers In Excess of Revenues and Other Financing Sources
over (under) Expenditures FUND BALANCE JULY 1
FUND BALANCE JUNE 30

REGULAR

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

0.00 $

0.00

$

99,185.75 $

$

99,185.75 $

$

-99,185.75 $

347,802.84 347,802.84 -347,802.84

99,185.75

$

0.00 $

0.00

-347,802.84 491,940.01

$

0.00 $ =====~1=4=4,:1.37;..17=

See notes to the general purpose financial statements. - 20-

EXHIBIT"H"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

LOTTERY PROJECT

TOTALS YEAR ENDED JUNE 30, 1997 JUNE 30, 1996

$

0.00 $

250,964.10 $

250,964.10 $_----::7..3.5=,6..8=0J.3=0=

$

6,346.00

$

6,346.00

40,500.00 $ _ _=.:..l":"=~

984,977.65 $ 1,529,537.14

$

46,846.00 $

991,323.65 $ 1,529,537.14

$

-46,846.00 $

-740,359.55 $

-793,856.84

291,290.45

390,476.20

1,001,532.20

$

-46,846.00 $

0.00

44,765.49 $ 18,982.00

-349,883.35 $ 510,922.01

207,675.36 303,246.65

$

-46,846.00 $

63,747.49 $

161,038.66 $ ====="=5=1:0!=,9=2=2=.=0=1=

- 21 -

CATOOSA COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUNDS YEAR ENDED JUNE 30.1997

EXHIBIT "I"

AWARD BANQUET FUND
ASSETS Cash and Cash Equivalents

BALANCE JULY 1,1996

ADDITIONS

BALANCE DEDUCTIONS JUNE 3D, 1997

$

0.00 $

5,570.26 $

5,570.26 $

0.00

LIABILITIES Funds Held for Others

$----=0.0~0 $

O. WAYNE ROLLINS FOUNDATION SCHOLARSHIP

ASSETS

Cash and Cash Equivalents

$

15iiio4oi.:i6.ii.3... $

5,570.26 $ -==-_==0=.0=0

5,000.00 $

1;,5;;4;,.,6;,-3=

LIABILITIES Funds Held for Others
PARTNERSHIP 2000 PROGRAM ASSETS
Cash and Cash Equivalents
LIABILITIES Funds Held for Others
TOTALS - AGENCY FUNDS ASSETS
Cash and Cash Equivalents
LIABILITIES Funds Held for Others

154.63 $

5,000.00 $ 5,000.00 $ =""'=""'==15=4=.6=3=

$---=---562.23 $

15,228.50 $

15,415.30 $ ......_.....3.7;5~.4=3=

$----;;,;;5;6,2;.;2;3- $

15,228.50 $

15,415.30 $ _ _.....,;;3;,,7;,,;5;;,..4...3...

716.86 $

25,798.76 $

25,985.56 $======5=3=0.=06=

716.86 $

25,798.76 $

25,985.56 $_"",===53=0~.0=6=

See notes to the general purpose financial statements.

- 22-

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 1997

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S, Department of Through Office of Treasury and Fiscal Services National Forest Reserve Funds Through Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1997 Grant National School Lunch Program 1997 Grant Food Distribution Program (1)
Total U. S. Department of Agriculture
Corporation for National and Community Service Through Georgia Department of Education Learn and Serve America School and Community Based Programs 1997 Grant
Education, U. S. Department of Through Georgia Department of Education Safe and Drug-Free Schools 1997 Grant Elementary and Secondary Education Act Title I Grants to Local Educational Agencies 1997 Grant Title II Eisenhower Professional Development 1996 Grant 1997 Grant Title VI Innovative Education Program Strategies 1997 Grant Goals 2000 - State and Local Education Systemic Improvement Grants 1996 Grant Individuals with Disabilities Education Act Part B - Special Education Flow Through 1997 Grant Preschool 1997 Grant Vocational Education - Basic Grants to States High School Program Basic Grant 1997 Grant Tech-Prep Education 1997 Grant
Total U. S. Department of Education

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

10.665 $

2.62

(5)

* 10.553
* 10.555 10.550
$

228,132,03
801,312.46 $ 154,948.78
1,184,395,89 $

(2)
2,408,698.25 (3) 154,948.78
2,563,647.03

94,004 $

6,475.50 $

6,290.51

84.186 $

44,016.00 $

44,016.00

* 84.010
84.281 84.281
84,298
84.276

654,223.30 26,335,00 32,989.00

654,223.30
10,464.71 12,479.98
32,989.00
7,243.11

84.027 84.173

255,521.85 42,220.33

255,521.85 42,220.33

84.048 84.243
$

74,064.00 5,500.00
1,134,869.48 $

74,064.00 5,500.00
1,138,722.28

- 23-

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30,1997

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Labor, U. S. Department of Through Coosa Valley Private Industry Council Job Training Partnership Act 17-95-20-003
OTHER FEDERAL ASSISTANCE
Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program
Total Federal Financial Assistance

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

17.250 $

10,470.05 $

10,470.05

$

67,875.81

(4)

$ 2,404,086.73 $ 3,719,129.87

Major Programs are identified by an asterisk (*) in front of the CFDA number.
The Board did not provide Federal Assistance to any Subrecipient.
(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 1997 National School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures are not maintained by fund source.
(4) Expenditures on this program were not maintained by fund source. (5) Funds eamed on this program do not require reporting of expenditures.

See notes to the general purpose financial statements.

- 24-

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1997

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs indirect Cost Pupil Transportation RegUlar Bus Replacement Middle School Incentive Program Special Instructional Assistance In-School Suspension Mid-term Adjustment Counselors Grades 4 and 5 Technology Training Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Advanced Placement Exams Alternative Program Apprenticeship Program At-Risk Summer School Program Health Insurance Innovative Programs Preschool Handicapped Program Remedial Summer School Program Teachers'Retirement Lottery Programs Exceptional Growth-Capital Outlay Instructional Technology
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACT Education, Georgia Department of Leadership Development Program

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$ 16,792,103.00
2,192,607.00 156,031.00 690,827.00 214,850.00
4,547,287.00
664,313.00 205,265.00 585,806.00 848,680.00 153,839.00 561,859.00
52,920.00 108,626.00 -2,892,050.00 1,782,751.00
$
42,630.00
473.70 148,500.00
60,000.00 34,692.85 487,822.01
5,000.00 85,855.00 11,022.27
9,288.53

189,836.00
$
166,460.00

$ 16,792,103.00
2,192,607.00 156,031.00 690,827.00 214,850.00
4,547,287.00

664,313.00 205,265.00 585,806.00 848,680.00 153,839.00 561,859.00
52,920.00 108,626.00 -2,892,050.00 1,782,751.00 189,836.00
42,630.00

473.70 148,500.00
60,000.00 34,692.85 487,822.01
5,000.00 85,855.00 11,022.27
9,288.53

250,964.10

250,964.10 166,460.00

215,275.81

215,275.81

90,329.00

90,329.00

2,000.00

2,000.00

$ 27,643,327.36 $ 571,571.81 $ 250,964.10 $ 28,465,863.27

See notes to the general purpose financial statements.

- 25-

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS YEAR ENDED JUNE 30, 1997

SCHEDULE "3"

EXPENDITURES
Current Instruction Support Services Pupil Services Student Transportation Services Food Services Operation

INSTRUCTIONAL PRE-KINDERGARTEN

TECHNOLOGY

PROGRAM

TOTAL

$

166,460.00 $

157,057.71 $
35,412.55 22,432.65
372.90

323,517.71
35,412.55 22,432.65
372.90

Total Expenditures

$

166,460.00 $

381,735.81

RECAP: Salaries and Benefits Pre-Kindergarten Program Other Expenditures Instructional Technology Pre-Kindergarten Program

$

203,715.27

166,460.00 11,560.54

$

381,735.81

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

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF SPECIAL PURPOSE LOCAL OPTION SALES TAX FUNDS
YEAR ENDED JUNE 30, 1997

SCHEDULE "4"

PROJECT Capital Outlay Projects

ESTIMATED COST

AMOUNT EXPENDED IN CURRENT
YEAR

AMOUNT EXPENDED
IN PRIOR YEARS

$ 30,870,000.00 $

46,846.00 (1) $

0.00

(1) The above projects are funded by a combination of Special Purpose Local Option Sales Taxes and State, Local Property Taxes or Other Funds.

See notes to the general purpose financial statements. - 27-

THIS PAGE LEFT BLAHK

CATOOSA COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1997

SCHEDULE "5"

Minimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis
Salaries Operations
Less: Expenditures for Media Center Programs in Excess of Total Media Allotment
Expenditures per Audit
Amount of Underexpenditure for Total Allotment

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

....::..:.=== $ 20,393,427,00 $ _ _ 616,042,00

$ 22,036,920,24 1,173,208.92 $ _----:1=,0=39=,9.;2.9...1:4..
$ 23,210,129.16

-441,733.89 $ 22,768,395.27

$

0.00 $====,,;;;,;.0;.0;0~

See notes to the general purpose financial statements. - 29 -

CATOOSA COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30,1997

GENERAL AND CAREER EDUCATION PRO~RAMS Kindergarten (*) Grades 1 - 3 (*) Sub-Total- K-3 Grades 4 - 5 (*) Grades 6 - 8 (*) Grades 9 - 12 (*) High School Laboratories (*) Vocational Education Laboratories (*) Total General and Career Education Programs
SPECIAL EDUCATION PROGRAMS Regular Programs Category I (*) Category II (*) Category III (*) Category IV (*) Category V (*) Sub-Total - Regular Category VI (Gifted) (*) Total Special Education Programs
REMEDIAL EDUCATION PROGRAM (*) Total Fourteen Weighted Programs
MEDIA CENTER PROGRAMS Salaries Operations Total Media Center Programs
Total Fourteen Weighted and Media Center Programs

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

REQUIRED

ORIGINAL

0/0.

ORIGINAL

MID-TERM

$ 1,880,203.00 4,788,361,00
$ 6,668,564.00 2,226,921.00 3,455,959.00 2,240,729.00 1,132,541.00 1,067,389.00
$ 16,792,103.00

$ 1,692,182.70 $

4,309,524.90

90 $ 6,001,707,60 $

90

2,004,228.90

90

3,110,363.10

90

2,016,656.10

90

1,019,286.90

90

960,650.10

$ 15,112,892.70 $

0.00 187,286.00 187,286,00 187,286.00 187,287.00
561,859.00

$ 1,871,074,00

$ 1,683,966.60 $

0.00

$ 1,871,074.00

321,533.00

$ 2,192,607.00

$

156,031.00

$ 19,140,741.00

90 $ 1,683,966.60 $

90

289,379.70

$ 1,973,346,30 $

90 $

140,427.90 $

$ 17,226,666.90 $

0.00
0.00 0.00 561,859.00

$

555,329.00 90 $

499,796.10 $

0.00

135,498.00 90

121,948.20

$

690,827.00

$

621,744.30 $

0,00

$ 19,831,568.00

$ 17,848,411.20 $

561,859.00

STAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development
Total Staff Development Programs (*) Identifies Fourteen Weighted Programs. See notes to the general purpose financial statements.

$

59,853.00

$

59,853.00 $

0.00

154,997.00

154,997.00

0.00

$

214,850.00 100 $

214,850.00 $===~==0=.0=0

- 30 -

SCHEDULE "6"

TOTAL REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$ 1,692,182.70 $ 2,122,624.48 $

34,035.88 $ 2,156,660.36

4,496,810.90

4,953,025.71

174,605.35

5,127,631.06

$ 6,188,993.60 $ 7,075,650.19 $

208,641.23 $ 7,284,291.42 $

0.00

2,191,514.90

2,487,925.82

73,917.26

2,561,843.08

0.00

3,297,650.10

3,545,816.37

145,984.56

3,691,800.93

0.00

2,016,656.10

2,683,280.68

192,967.90

2,876,248.58

0.00

1,019,286.90

1,167,401.97

112,286.59

1,279,688.56

0.00

960,650.10

1,285,054.27

138,703.67

1,423,757.94

0.00

$ 15,674,751.70 $ 18,245,129.30 $

872,501.21 $ 19,117,630.51

$ 1,683,966.60 $

79,210.89 $ 545,806.16 1,319,160.10 244,091.16 128,058.11

35,148.31 $ 3,491.75
99,939.38 6,070.66

114,359.20 549,297.91 1,419,099.48 250,161.82 128,058.11

$ 1,683,966.60 $ 2,316,326.42 $

144,650.10 $ 2,460,976.52

0.00

289,379.70

333,502.17

11,404.33

344,906.50

0.00

$ 1,973,346.30 $ 2,649,828.59 $

156,054.43 $ 2,805,883.02

$

140,427.90 $

142,681.24 $

11,373.50 $

154,054.74

0.00

$ 17,788,525.90 $ 21,037,639.13 $ 1,039,929.14 $ 22,077,568.27

$

499,796.10 $

999,281.11

$

999,281.11

0.00

121,948.20

$

133,279.78

133,279.78

0.00

$

621,744.30 $

999,281.11 $

133,279.78 $ 1,132,560.89

$ 18,410,270.20 $ 22,036,920.24 $ 1,173,208.92 $ 23,210,129.16 $

0.00

$

59,853.00

154,997.00

$

214,850.00

$

188,853.00 $

188,853.00

25,997.00

25,997.00

$

214,850.00 $

214,850.00 $ ========0=.0=0

- 31 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

CLAUDE L. VICKERS
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
February 17, 1998

Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Catoosa County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements of Catoosa County Board of Education as of and for the year ended June 30, 1997, and have issued our report thereon dated February 17, 1998. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general-purpose fmancial statements. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1997, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.
Compliance
As part of obtaining reasonable assurance about whether Catoosa County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of fmancial 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 an instance ofnoncompliance that is required to be reported under Government Auditing Standards which is described in the accompanying Schedule of Findings and Questioned Costs as item FS6231-97-01.
97YB-60

Internal Control Over Financial Reporting
In planning and performing our audit, we considered Catoosa County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgement, could adversely affect Catoosa County Board ofEducation's ability to record, process, summarize and report fmancial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule of Findings and Questioned Costs as item FS-6231-97-02.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, the reportable condition described above is considered to be a material weakness.
This report is intended for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter of public record.
Respectfully submitted,

CLV:gp 97YB-60

Claude L. Vickers State Auditor

CLAUDE L. VICKERS
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
February 17,1998

Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Catoosa County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULARA-133
Ladies and Gentlemen:
Compliance
We have audited the compliance of Catoosa County Board of Education with the types of compliance
u.s. requirements described in the Office 0/Management and Budget (OMB) Circular A-i33 Compliance
Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1997. Catoosa County Board of Education's major Federal programs are identified in the accompanying Summary Schedule of Auditor's Results. Compliance with the requirements of laws, regulations, contracts and grants applicable to each ofits major Federal programs is the responsibility of Catoosa County Board of Education's management. Our responsibility is to express an opinion on Catoosa County Board ofEducation's compliance based on our audit.
We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major Federal program
occurred. An audit includes examining, on a test basis, evidence about the Catoosa County Board of
Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Catoosa County Board of Education's compliance with those requirements.

97SA-10

In our opinion, the Catoosa County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30, 1997.
Internal Control Over Compliance
The management of Catoosa 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 Catoosa County Board of Education'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 of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133.
Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more ofthe internal control components does not reduce to a relatively low level ofrisk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter of public record.
R e : 2submitted,

CLV:gp 97SA-10

Claude L. Vickers State Auditor

SECTIONffi SUMMARY OF AUDITOR'S RESULTS

CATOOSA COUNTY BOARD OF EDUCATION SUMMARY SCHEDULE OF AUDITOR'S RESULTS
YEAR ENDED JUNE 30, 1997
1. Type of Report Issued on the Financial Statements The Catoosa County Board of Education's financial statements were qualified for a scope limitation and for various departures from generally accepted accounting principles.
2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Catoosa County Board ofEducation disclosed a financial statement reportable condition related to the following control category:
General Fixed Assets
The reportable condition described above is considered to be a material weakness.
3. Noncompliance Material to the Financial Statements The audit of the Catoosa County Board of Education disclosed one instance of noncompliance deemed material to the financial statements. This noncompliance involved the Board's failure to transfer required funds from the General Fund to the Capital Projects Fund.
4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Catoosa County Board ofEducation did not disclose any reportable conditions in internal control over major programs.
5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Catoosa County Board of Education's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be Reported by Section .51O(a) of OMB Circular A-B3 The Catoosa County Board of Education's audit did not disclose audit findings required to be reported by section .51O(a) ofOMB Circular A-B3.
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program 84.010 Elementary and Secondary Education Act - Title I - Grants to Local Educational Agencies
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00
9. Low Risk Auditee The Catoosa County Board of Education did not qualify as a low risk auditee.
97SAR-l

SECTION IV AUDlTEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

CATOOSA COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1997

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

6231-93-01 6231-93-02 6231-95-01 6231-96-01

Previously Reported Corrective Action Implemented Unresolved - See Corrective Action/Response Further Action Not Warranted Unresolved - See Corrective Action/Response

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number 6231-93-02

Due to current staffing limitations and budgetary considerations prohibiting the hiring of additional administrative staff, the Board has decided not to pursue the recording of general fixed assets on the financial statements.

EXPENDITURESILIABILITIESIDISBURSEMENTS Failure to Meet Expenditure Requirements Amount: $7,987.21 Finding Control Number 6231-96-01

The underexpenditure of Quality Basic Education (QBE) funds of $7,987.21 for the Remedial Education Program will be returned to the Georgia Department of Education through an increase in the Board's local fair share for the QBE Program in a subsequent fiscal period.

SECTION V CURRENT YEAR FINDINGS AND QUESTIONED COSTS

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 1997
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL LEDGER Failure to Transfer Local Matching Funds Material Noncompliance Finding Control Number FS-6231-97-01
The Board failed to transfer local matching funds from the General Fund to the Capital Projects Fund as required for the approved State Capital Outlay Project for the 1997 fiscal year. Both the instructions in Chapter 41 ofthe Financial Management for Georgia Local Units ofAdministration and the agreement signed by the Board to receive the funding through Georgia Department of Education require that the Board transfer local matching funds by year end and designate those funds by project name and number. A correcting audit adjustment was necessary to transfer $128,782.00 from the General Fund to Lottery Project No. 98/97S-62306 as required.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Finding Control Number FS-6231-97-02
The Catoosa County Board of Education has chosen not to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance ofa General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group.

SECTION VI PERTINENT VIEWS OF RESPONSffiLE OFFICIALS

CATOOSA COUNTY BOARD OF EDUCATION PERTINENT VIEWS OF RESPONSIDLE OFFICIALS
YEAR ENDED JUNE 30, 1997
GENERAL LEDGER Failure to Transfer Local Matching Funds Material Noncompliance Finding Control Number FS-6231-97-01
Our failure to transfer local matching funds from the General Fund to the Capital Projects Fund was an oversight on my part. We had the necessary funds on hand for this transfer, but simply failed to make the transfer at the proper time. This should not be a problem in the future. We have changed some local procedures that should prevent this finding in future years.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Finding Control Number FS-6231-97-02
Our system has given the subject of fixed asset accounting a lot of thought. At this time we do not have the means of setting up this account group. At such a time as the state provides us with the program to do this we will begin the task of accounting for our fixed assets.