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ASoo .Rl fJ.6 C36 1911-1g
AUDIT REPORT CATOOSA COUNTY BOARD OF EDUCATION
RINGGOLD, GEORGIA YEAR ENDED JUNE 30, 1998
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

7

ADDmONAL FINANCIAL INFORMATION

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

19

I

FIDUCIARY FUND TYPE

COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUNDS

20

SCHEDULES

1 SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

21

2 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

22

3 SCHEDULE OF STATE REVENUE

24

4 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

25

CATOOSA COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

5 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAMS

26

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

6

OVERALL

27

7

BY PROGRAM

28

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-133

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

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

SECTION I FINANCIAL

RUSSELL W. HINTON
STATEAUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
April 1, 1999

Honorable Roy E. Bames, 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 fmancial statements of the Catoosa County Board of Education, as of and for the year ended June 30, 1998, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe Catoosa County Board ofEducation's management. Our responsibility is to express an opinion on these general purpose financial 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 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 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, 1998, 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 fmancial 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:

98ARL-13B

* The general purpose fmancial 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, 1998, a portion of salaries.
and the corresponding employer's cost ofrelated benefits earned for cbntractual services completed prior to June 30, 1998. Also funds received, subsequent to June 30, 1998, from the Georgia Department of Education for the State's share ofthese 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, 1997, were improperly recorded in the year ended June 30, 1998. 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 financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects ofsuch adjustments, ifany, 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 financial position ofthe Catoosa County Board ofEducation as ofJune 30, 1998, 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 April 1, 1999, on
our consideration of the Catoosa County Board of Education's internal control over fmancial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants.
The year 2000 supplementary information on Schedule "1" is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods ofmeasurement and presentation ofthe supplementary information. However we did not audit
the information and do not express an opinion on it. In addition, we do not provide assurance that Catoosa
County Board of Education is or will become year 2000 compliant, that the Board's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Catoosa County Board of Education does business are or will become year 2000 compliant.
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 2 through 7), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133,
98ARL-13B

AuditsofStates, LocalGovernments, andNon-Profit Organizations, are presented for purposes ofadditional
analysis and are not a required part ofthe general purpose fmancial statements. Such information has been subjected to the auditing procedures applied in the audit of the general purpose fmancial 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 ofthe 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.
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,
~.... QP. J.~ Russell W. Hinton State Auditor
RWH:jb 98ARL-13B

CATOOSA COUNTY BOARD OF EDUCATION

ASSETS Cash and Cash Equivalents Accounts Receivable Prepaid Items Due from Other Funds Inventories
Food Donated Commodities Purchased Food
Total Assets

CATOOSA COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30,1998

GOVERNMENTAL FUND

SPECIAL

GENERAL

REVENUE

FUND

FUND

$ 3,247,040,71 $ 1,175,049,22

359,775:26

159,546.87

1,000,00

61,755.42 27,132,54
$ 3,607,815.97 $ 1.423.484,05

Total Liabilities and Fund Equity

$

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

3,607,815,97 $ 1.423.484.05

EXHIBIT"A"

'TYPES CAPITAL
PROJECTS FUND

FIDUCIARY FUND TYPE AGENCYFUNDS

TOTALS (Memorandum Only) JUNE 30.1998 JUNE 30.1997

$ 2,549.451.57 $

1,532.16 $ 6,973,073.66 $ 4.407,130.71

1,083.478.94

1,602,801.07

321,652.63

1,000.00

46,846.00

61,755.42 27.132.54

43,185.06 21,660.04

$ 3.632.930.51 $

1.532.16 $ 8.665.762.69 $ 4.840.474.44

$

6.116.78

305,839.00 213,364.00

$

$

525,319.78 $

$
1.532.16 1,532.16 $

85,613.04 $ 249,270.54
9,172.65 305,839.00 213,364.00
1,532.16
864.791.39 $

76,816.12 242,131.30
5,504.49 134,027.00 80,566.70 46,846.00
530.06
586.421.67

$ 3,107,610.73
0.00 $ 3.107,610.73 $ 3.632.930.51 $

$

76,084.33 $

14,040.01

7,987.21

7,987.21

61,755.42 27,132.54 3,107,610.73

43,185.06 21,660.04
272,919.17

4,520.401.07

-111,880.51 4,006.141.79

$ 7.800.971.30 $ 4.254,052.77

1.532.16 $ 8.665,762.69 $ 4,840.474.44 -3-

The notesto the generalpurposefinancial statements are an integralpart of this statement. -4-

CATOOSA COUNTYBOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - lNON-GAAPBASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEARENDED JUNE 30. 1998

EXHIBIT"C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 28,620,462.00 $ 29,666,068.87

65,000.00

64,830.93

10,046,294.00 10,164,963.25

82,000.00

1,121,929.28

Total Revenues

$ 38,813,756.00 $ 41,017,792.33

EXPENDITURES

Current Instruction Support Services Pupil Services Improvementof Instructional Services Educational MediaServices General Administration School Administration BusinessAdministration Maintenance and Operationof Plant StudentTransportation Services Central SupportServices Other Support Services Food ServicesOperation CommunityServices Operations
Capital Outlay

$ 26,652,710.00 $ 26,879,741.75

1,589,034.00 755,862.00
1,204,878.00 340,078.00
3,474,550.00 396,601.00
2,935,265.00 1,626,588.00
237,994.00 39,141.00

1,914,717.79 818,846.73
1,226,783.99 488,469.70
3,507,863.12 379,147.48
2,975,735.25 1,893,528.94
219,966.73 257,450.06
221.88

143,209.00

148,767.80

Total Expenditures

$ 39,395,910.00 $ 40,711,241.22

Excess of Revenuesover (under) Expenditures

$ -582,154.00 $ 306,551.11

OTHER FINANCING SOURCES(USES)

Other Sources Other Uses

$ 128,782.00

$

-5,000.00

-5,000.00

Total Other Financing Sources(Uses)

$

-5,000.00 $ 123,782.00

Excessof Revenuesand Other Financing Sources over (under) Expenditures and Other Financing Uses $

-587,154.00 $

430,333.11

FUND BALANCEJULY 1. 1997

3,257,520.64

3,175,584.64

Adjustments Food Inventory- Net Changein Period
Donated Commodities Purchased Food

-72.58

SPECIALREVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$

618,098.00 $

662,226.59

2,206,397.00

2,612,250.01

1,239,027.00

1,326,814.62

$ 4,063,522.00 $ 4,601,291.22

$ 1,220,393.00 $ 1,276,489.67

114,060.00 14,940.00 10,280.00 93,778.00

142,359.47 77,391.77 14,419.81 85,973.75 311.09

350.00 75,736.00

6,326.87 73,296.39

32,633.00 2,506,352.00

3,841.94 2,765,910.75
13,999.22

$ 4,068,522.00 $ 4,460,320.73

$

-5,000.00 $

140,970.49

$

5,000.00 $

5,000.00

$

5,000.00 $

5,000.00

$

0.00 $

145,970.49

902,891.74

917,429.47

184.57

18,570.36 5,472.50

FUND BALANCEJUNE 30. 1998

$ 2,670,294.06 $ 3,605,917.75

$ 903,076.31 $ 1,087,442.82

The notes to the general purposefinancialstatements are an integral part of this statement. -5-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

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 financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control ofthe Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most ofa Board's educational activities. Governinental 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 government to accomplish specific educational objectives.

-7-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FiNANCIAL STATEMENTS

JUNE 30,1998

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 fund 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. This

fund includes:

'

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, local option sales taxes, intergovernmental grants and investment income.

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 1998, a substantial number of personnel ofthe Board were employed for a one hundred and ninety day period beginning in late August 1997 and ending in early June 1998. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1997 and ending in August 1998. State grants to fund the State's share ofthese contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As of June 30, 1998, compensation under these employment

- 8-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
contracts had been earned, but two of the twelve monthly payments, due for July and August 1998, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30,1998. Also, the State's portion of the compensation paid in July and August 1998 was received and recorded as revenue in the fiscal year subsequent to June 30, 1998. Conversely, the similar expenditures and related.revenues for contractual services completed prior to June 30, 1997, were recorded in the year ended June 30, 1998. 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 ofgeneral circulation in the locality. At the next regular meeting ofthe Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a fmal 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 EQUIVALENTS
COMPOSmON 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.
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

-9-

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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 1997 tax year (calendar year) on August 1, 1997 (levy date). Taxes were due on December 20, 1997. The lien date for property taxes was January 1, 1997. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1998. 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 1997 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

14.499 mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes. Special Purpose Local Option Sales Tax collected by the State and remitted to the Board during the fiscal year amounted to $5,353,377.57 and was recorded in the Capital Projects Fund. The State will terminate collection ofthis tax once an additional $25,516,622.43 has been collected or on June 30, 2002, whichever occurs first.

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.

PREPAID ITEMS

Payments made to vendors for services that will benefit periods subsequent to June 30, 1998, are recorded as prepaid items.

- 10 -

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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.
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.
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 ofthe face value of such surety bond and the market value ofsecurities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount 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,
(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 ofthe counties or municipalities of the State of Georgia,

- 11 -

CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 2: 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 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.

CATEGORIZATION OF DEPOSITS At June 30, 1998, the bank balances were $9,813,293.78. 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, 1998, as follows:

Risk Category

Bank Balance

1

$ 200,000.00

2

1,136,830.50

3

. 8.476.463.28

Total

$ 9.813.293.78

Note 3: NON-MONETARY TRANSACTIONS

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

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CATOOSA COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 4: RISK MANAGEMENT

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

The Board has obtained commercial insurance for risk ofloss associated with torts, assets, errors or omissions and 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:

1997 1998

Beginning
of Year
Liability

Claims and Changes in Estimates

$

0.00 $ 78,368.47 $

$

0.00 $ 117,141.01 $

Claims Paid

End of Year
Liability

78,368.47 $

0.00

117,141.01 $

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
o f Year
Liability

Claims and Changes in Estimates

Claims Paid

End of Year
Liability

1997 1998

$

0.00 $

2,352.20 $

2,352.20 $

0.00

$

0.00 $

292.12 $

292.12 $

0.00

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

Position Covered

Amount

Superintendent All Other Employees

$ 25,000.00 $ 35,000.00

- 13-

CATOOSA COUNTY BOARD OF EDUCATION

EXlllBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

NoteS: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of $616,516.47 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.

Georgia Department ofEducation Paid to the State Merit System of Personnel Administration For Health Insurance ofNon-Certified Personnel In the amount of $500,639.95

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $7,799.52

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 $108,077.00

Note 6: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the Board as of June 30, 1998:

Project

Unearned Executed Contracts

Lottery 98/97S-623-006 Ringgold Primary School

$ 300,694.19 6.534,616.43
s 6.835.310.62

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

Note 7: CONTINGENT LIABILITIES

Amounts received or receivableprincipally 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 fmancial position.

- 14-

CATOOSA COUNTY BOARD OF EDUCATION

EXIllBIT "D"

NOTES TO THE GENERAL PURPOSEFINANCIAL STATEMENTS

JUNE 30. 1998

Note 7: CONTINGENT LIABILITIES

The Board is a defendant in variouslegalproceedings pertainingto matters incidentalto the performanceof routine Board operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the generalpurpose fmancial statements.

Nore8: RETrnEMENTPLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

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

TRS CONTRIBUTIONS REQUIRED AND MADE

Employees ofthe Board who are covered by TRS are required by Statestatute to contribute 5% oftheir gross

earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS

Board ofTrustees in accordance with Statestatute and as advised by their independent actuary. The required

employer contribution rate is 11.81% and employer contributions for the currentfiscal year and the preceding

two fiscal years are as follows:

.

Fiscal Year

Percentage Contributed

Required Contribution

1998 1997 1996

100% 100% 100%

$ 3,082,730.48 $ 2,785,754.61 $ 2,538,613.53

- 15 -

CATOOSA COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 1998

EXHIBIT"E"

Cash and Cash Equivalents Accounts Receivable Inventories
Food Donated Commodities Purchased Food
Total Assets

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

FEDERAL PROGRAMS

TOTALS JUNE 30,1998 JUNE 30,1997

$ 1,070,900.30 $

29,242.16 $

74,906.76 $ 1.175,049,22 $ 1.036.031,58

21.856.71

137,690.16

159,546.87

137.213.15

61,755.42 27,132.54

61,755.42 27,132.54

43,185.06 21.660.04

$ 1,181,644.97 $

29,242.16 $

212.596.92 $ 1,423,484.05 $ 1,238,089.83

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

$

34,473.86 $

135,812.62

$

170,286.48 $

6,638.48 $ 22,603.68
29.242.16 $

37.158.56 $ 90,854.24
8,499.79
136,512.59 $

$ 78.270.90 249.270.54
8,499.79
336,041.23 $

3,702.93 69,321.64 242,131.30
5,504.49
320,660.36

$

61,755.42

27.132.54

922,470,53 $

$ 1.011,358.49 $

$

76,084.33 $

76.084,33 $

14,040.01

0.00 0.00 $

61.755.42 27,132.54

0.00

922,470,53

. 76,084.33 $ 1.087,442.82 $

43,185.06 21,660.04
838,544.36
917,429.47

Total Liabilities and Fund Equity

$ 1,181,644.97 $

29,242.16 $

212.596.92 $ 1,423,484.05 $ 1.238,089,83

~

See notes to the general purpose financial statements.

-16 -

See notesto the general purposefinancial statements.

17 -

CATOOSA COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30,1998

EXHIBIT"G"

ASSETS Cash and Cash Equivalents Accounts Receivable
Total Assets

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

SPECIAL PURPOSE LOCAL OPTION
SALES TAX

LOTIERY PROJECT

TOTALS

JUNE 30, 1998

JUNE 30,1997

$

5,000.00 $ 2,458,868.77 $

85,582.80 $ 2,549,451.57 $

425,158.90

974,537.74

108,941.20

1,083,478.94

$

5,000.00 $

3,433,406.51 $

194,524.00 $

3,632,930.51 $

425,158.90

LIABILITIES AND FUND EQUITY

LIABILITIES

Accounts Payable

Contracts Payable

Retainages Payable

$

Due to Other Funds

Total Liabilities

$

FUND EQUITY

Fund Balances

Reserved

For SPLOST Projects

For State Capital Outlay Projects

Unreserved

Deficit

Undesignated

$

Total Fund Equity

$

Total Liabilities and Fund Equity

$

$ 5,000.00
5,000.00 $

6,116.78 305,839.00
13,840.00 $

$ 194,524.00

325,795.78 $

194,524.00 $

6,116.78 $ 305,839.00 213,364.00
525,319.78 $

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

$ 3,107,610.73

0.00 0.00 $

0.00 $ 3,107,610.73 $

$

3,107,610.73

.$

0.00 0.00 $

0.00 3,107,610.73 $

272,919.17
-111,880.51 0.00
161,038.66

5,000.00 $

3,433,406.51 $

194,524.00 $

3,632,930.51 $

425,158.90

See notes to the general purpose financial statements.

-18 -

Seenotesto the general purpose financial statements.

-19

CATOOSA COUNTYBOARDOF EDUCATION COMBINING STATEMENT OF CHANGES IN ASSETSAND LIABILITIES
FIDUCIARY FUNDTYPE- AGENCYFUNDS YEAR ENDEDJUNE 30, 1998

EXHIBIT"I"

LIABILITIES

Funds Held for Others

$

O. WAYNE ROLLINS FOUNDATION SCHOLARSHIP

ASSETS

Cash and Cash Equivalents

$

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

$

0,00 $

5,000.00 $

4,562.00 $======43=8=.0=0

154.63 $

10,000.00 $

10,000.00 $===,;,,;;;,1,5;=4.=6=3

154.63 $

10,000.00 $

10,000.00 $===.,;,;0,1,5;=4.=6=3

375.43 $

13,120.00 $

12.555.90 $=====9=39=.5=3

375.43 $

13,120.00 $

12,555.90 $======93=9=.5=3

530.06 $

28,120.00 $

27,117.90 $==......1.,:5I3~2=.1=6=

530.06 $

28,120.00 $

27,117.90 $=======1=,5:,3;,2;,.:1;;6"

See notes to the general purposefinancial statements.

-20 -

CATOOSA COUNTY BOARD OF EDUCATION

SCHEDULE "1"

. SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

YEAR 2000 DISCLOSURES

YEAR ENDED ruNE 30, 1998

At June 30, 1998, the Catoosa County Board of Education had no outstanding contractual commitments for the purpose ofmaking computer systems and other electronic equipment year 2000 compliant. The year 2000 issue is the result of shortcomings in many electronic data processing systems and other equipment that make operations beyond year 1999 troublesome. The year 2000 issue is ofprimary concern for the Board's financial accounting system. The following stages have been identified as necessary to implement a year 2000 compliant systems.
Awareness Stage -. Encompasses establishing a budget and project plan for dealing with the year 2000 issue.
Assessment Stage - The actual process of identifying all of its systems and individual components of the systems to check for compliance.
Remediation Stage - When changes are made to systems and equipment.
ValidationfTesting Stage - The process of ensuring that the changes made to systems and equipment will produce a year 2000 compliant system.
.It will be necessary for the Board to progress through all four of these stages for each computer and/or electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversely affected. As of June 30, 1998, the financial accounting system was determined to be at the Awareness Stage.
The Board's financial accounting software (GENESIS) and hardware (Wang VS) is owned by the State (Georgia Department ofEducation). These systems have been determined to be critical to the Board's ability to successfully conduct operations. As ofJune 30, 1998, the State had not contracted for the remediation of either the Wang VS operating system or the GENESIS accounting software. In the subsequent period, the Georgia Department of Education remediated the Wang VS operating system and the updated operating system was installed at all GENESIS sites as of December 9, 1998. The Georgia Department of Education has remediated the GENESIS software and conducted tests at nine pilot sites. The remediated GENESIS software has been provided to all boards of education currently utilizing the GENESIS accounting software.

See notes to the general purpose financial statements. - 21 -

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDEDJUNE 30. 1998

SCHEDULE "2"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Agriculture, U. S. Department of Pass-Through from Office of Treasuryand Fiscal Services NationalForest Reserve Funds Pass-Through from GeorgiaDepartment of Education Food and NutritionProgram Food Services School BreakfastProgram 1998 Grant NationalSchool LunchProgram 1998 Grant Food Distribution Program(1)

10.665

N/A $

2.11

(4)

10.553

N/A

10.555

N/A

10.550

N/A

255,064.05
880,503.86 $ 184,875.94

(2)
2,579,390.36 (3) 184,875.94

Total U. S. Department of Agriculture

$ 1,320,445.96 $ 2,764,266.30

Corporation for Nationaland Community Service Pass-Through from GeorgiaDepartment of Education Learn and ServeAmerica School and CommunityBased Programs 1997 Grant 1998 Grant

94.004 94.004

N/A $ 2,815.01 $

N/A

9,475.00

3,000.00 264.75

Total Corporation for National and Community Service

$ 12,290.01 $

3,264.75

Education, U. S. Department of Pass-Through from GeorgiaDepartment of Education Elementaryand Secondary Education Act Title I Grants to Local Educational Agencies 1998 Grant . 1998 Summer Grant Title II Eisenhower Professional Development 1997 Grant 1998 Grant Title IV Innovative Education Program Strategies 1998 Grant Goals 2000 State and Local Education Systemic ImprovementGrants 1997 Grant 1998 Grant Individuals with Disabilities Education Act Part B - Special Education Flow Through 1998 Grant Preschool 1998 Grant Special Projects 1998 Grant Vocational Education - Basic Grantsto States High School Program Basic Grant 1998 Grant Tech-Prep Education 1998 Grant

* 84.010 * 84.010
84.281 84.281
84.298

N/A $ 631,033.88 $

NlA

53,527.00

NlA

N/A'

22;812.16

NlA

36,626.04

631,033.88 ..15,000.27
13,855.02 22,812.16
36,626.04

84.276

N/A

84.276

NiA

10,315.07 60,000.00

10,315.07 31,652.65

* 84.027

NlA

* 84.173

N/A

* 84,027

N/A

324,548.47 47,809.81
1,660.50

324,548.47 47,809.81
1,660.50

84.048

NlA

84.243

N/A

72,184.00 5,000.00

n,184.00 (3) 5,000.00

Total U. S. Department of Education

$ 1,265,516.93 $ 1,217,497.87

- 22-

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30.1998

.SCHEDULE "2"

FUNDING AGENCY PROGRAM/GRANT
Labor, U. S. Department of Pass-Through from CoosaValley PrivateIndustry Council Job Training Partnership Act 17-96-20-003
OTHERFEDERAL ASSISTANCE
Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program

CFDA NUMBER

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

17.250

N/A $ 13,999.22 $

13,999.22

$ 64,828.82 $

232,946.22 (3)

Total FederalFinancial Assistance

$ 2,677,080.94 $

N/A=NotAvailable

Notesto the Schedule of Expenditures of Federal Awards

(1) The amountsshownfor the Food.Distribution Program represents the Federally assigned value of nonmonetary assistancefor donatedcommodities received and/orconsumed by the systemduringthe currentfiscal year.
(2) Expenditures for the School BreakfastProgram were not maintained separately and are included in the 1998 National School Lunch Program.
(3) Expenditures for this program includeState, and/orOtherFunds. Expenditures are not maintained by fund source.
(4) Funds eamed on this programdo not require reporting of expenditures.

Major Programsare identified by an asterisk(*) in front of the CFDAnumber.

The Board did not provideFederalAssistanceto any SUbrecipient.

The accompanying scheduleof expenditures of Federal awards includes the Federal grant activityof the CatoosaCountyBoard of Education and is presented on the modified accrual basis of accounting which in the same basis of accounting used in the presentation of the general purpose financial statements.

4,231,974.36

See notesto the general purposefinancial statements.

- 23-

CATOOSA COUNTY BOARD OF EDUCATION . SCHEDULE OF STATE REVENUE YEARENDED JUNE30, 1998

SCHEDULE "3"

AGENCYIFUNDING
GRANTS Administrative Services, Georgia Department of Georgia Statewide Academic and Medical System
Education, GeorgiaDepartment of QualityBasic Education Generaland CareerEducation Programs SpecialEducation Programs Remedial Education Program MediaCenterPrograms Staff Development Programs IndirectCost PupilTransportation Regular Bus Replacement MiddleSchoolIncentive Program Special Instructional Assistance In-School Suspension Mid-term Adjustment Counselors Grades4 and 5 Technology Training LocalFair Share Educational Equalization Funding Grant Food Services Vocational Education OtherState Programs Ad Valorem Tax Adjustment Advanced Placement Exams Alternative Program Apprenticeship Program At-Risk SummerSchoolProgram Environmental Science Program Health Insurance Innovative Programs MentorTeacherProgram Preschool Handicapped Program Remedial SummerSchoolProgram Teachers'Retirement Tuitionfor the Multi-Handicapped LotteryPrograms Alternative School Program Exceptional Growth-Capital Outlay Instructional Technology Assistive Technology Classroom Technology
Officeof SchoolReadiness Pre-Kindergarten Program
Officeof Treasuryand Fiscalservices PublicSchoolEmployees Retirement

GOVERNMENTAL FUNDTYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$

5,n5.00

$

5,n5.00

18,371,753.00 2,380,784.00
190,622.00 749,675,00 225,137.00 4,786,963.00
664,259.00 208,928.00 651,702.00 855,438.00 163,567.00 497,947.00
79,727.00 72,106.00 -3,172,539.00 1,763,511.00
$ 7,301.14
194,310.00 569.88
148,500.00 55,000.00 24,978.51 500.00
500,639.95 5,000.00 940.00
91,414.00 10,262.37
7,799.52 15,421,50

200,934.00
4,132.00 $
11,240.00 235,546.00

838,447.90

18,371,753.00 2,380,784,00
190,622.00 749,675.00 225,137.00 4,786,963.00
664,259.00 208,928.00 651,102.00 855,438.00 163,567.00 497,947.00
79,727.00 72,106.00 -3,172,539.00 1,763,511.00 200,934.00
7,301.14
194,310.00 569.88
148,500.00 55,000.00 24,978.51
500.00 500,639.95
5,000.00 940.00
91,414.00 10,262.37 7,799.52 15,421.50
4,132,00 838,447.90
11,240.00 235,546.00

210,374.59

210,374.59

108,OnOO

108,On.00

$ 29,666,068.87 $

662,226.59 $

838,447.90 $ 31,166,743.36

See notesto the generalpurpose financial statements.

- 24-

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30. 1998

SCHEDULE "4"

PROJECT

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED
COST (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT E;XPENDED
IN PRIOR YEARS

To build, equip and furnish three new schools; to make additions, renovations, and provide furnishings and equipment at all existing schools, and to acquire land and pay for site preparation for three new schools

$ 30,870,000.00 $ 30,870,000.00 $

3,161,111.75 $

46,846.00

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

See notes to the general purpose financial statements. - 25-

CATOOSA COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS YEAR ENDED JUNE 30, 1998

SCHEDULE "5"

EXPENDITURES

ALTERNATIVE SCHOOL PROGRAM

INSTRUCTIONAL TECHNOLOGY

ASSISTIVE

CLASSROOM

TECHNOLOGY TECHNOLOGY

PRE-KINDERGARTEN PROGRAM

Current

Instruction

$

Support Services

Pupil Services

Improvement of Instructional Services

General Administration

Maintenance and Operation of Plant

Other Support Services

Food Services Operation

4,132,00 $

11,240,00 $ 235,546.00 $

156,382,75 $
33,095,58 1,895.19
11,651.99 5,683.11 21.52 1,644.45

TOTAL
407,300,75
33,095,58 1,895.19
11,651.99 5,683.11 21,52 1,644.45

Total Expenditures

$

4,132.00 $

11,240.00 $ 235,546.00 $

....2..1..0..,.3_74...5-9- $ 461,292.59

RECAP: Salaries and Benefits Pre-Kindergarten Program Other Expenditures Altemative School Program Instructional Technology Assistive Technology Classroom Technology Pre-Kindergarten Program

$

152,262.19

4,132,00

11,240.00 235,546.00
58,112.40

$---~~461-,29-2.5.9

See notes to the general purpose financial statements.

- 26-

CATOOSA COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30,1998

SCHEDULE "6"

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

$ 22,190,781.00 $

639,565,00

$ 24,400,172.53 1,103,149.90 $
$ 25,503,322.43

956,304,86

-458,411.91
$ 25,044,910,52

$

0,00 $===~0.~ 00

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

CATOOSA COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1998

GENERAL AND CAREER EDUCATION PROGRAMS 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 C*) 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

~

ORIGINAL

MID-TERM

$ 2,127,309,00

$ 1,914,578.10

5,309,452.00

4,778,506,80 $

$ 7,436,761.00 90 $ 6,693,084.90 $

2,377,687.00 90

2,139,918.30

3,843,858.00 90

3,459,472.20

2,375,229.00 90

2,137,706.10

1,226,299.00 90

1,103,669.10

1,111,919.00 90

1,000,727.10

$ 18,371,753.00

$ 16,534,577.70 $

331,964.00 331,964.00 165,983,00
497,947.00

$ 2,056,810.00

$ 1,851,129.00 $

0.00

$ 2,056,810.00

323,974.00

$ 2,380,784,00

$

190,622.00

$ 20,943,159.00

90 $ 1,851,129,00 $

90

291,576.60

$ 2,142,705.60 $

90 $

171,559.80 $

$ 18,848,843.10 $

0.00
0.00 0.00 497,947.00

$

610,156.00 90 $'

549,140,40 $

0.00

139,519.00 90

125,567.10

$

749,675.00

$

674,707.50 $

0.00

$ 21,692,834.00

$ 19,523,550,60 $

497,947.00

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

$

65,383.00

159,754.00

s

65,383.00 $

159,754.00

$

225,137.00 100 $

225,137.00 $

0.00 0.00
0.00

- 28 -

SCHEDULE "T'

TOTAL REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNTOF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$ 1,914,578.10 $ 2,206,431.10 $

59,815.95 $ 2,266,247.05

5,110,470.80

5,727,760.53

182,951.47

5,910,712.00

$ 7,025,048.90 $ 7,934,191.63 $

242,767.42 $ 8,176,959.05 $

0.00

2,305,901.30

2,662,024.00

99,645.62

2,761,669.62

0.00

3,459,472.20

3,852,226.09

167,543.75

4,019,769.84

0.00

2,137,706.10

2,837,251.87

149,714.92

2,986,966.79

0.00

1.103,669.10

1,352,713.34

70,062.40

1,422,775.74

0.00

1,000,727.10

1,347.264.01

131.855.76

1,479,119.77

0.00

$ 17,032.524.70 $ 19.985,670.94 $

861,589.87 $ 20,847,260.81

$ 1.851,129.00 $

125,902.75 $ 618,479.97 1,524,767.45 324.687.48 177,470.34

38,878.52 $ 2,712.23 31,329.35 11,632.08

164,781.27 621,192.20 1,556,096.80 336,319.56 177,470.34

$ 1,851,129.00 $ 2,771,307.99 $

84,552.18 $ 2,855,860.17

0.00

291.576.60

372,607.09

10.002.15

382.609.24

0.00

$ 2,142,705.60 $ 3,143,915.08 $

94,554.33 $ 3,238,469.41

$

171,559.80 $

209,344.64 $

160.66 $

209,505.30

0.00

$ 19,346,790.10 $ 23,338,930.66 $

956,304.86 $ 24,295,235.52

$

549,140.40 $ 1,061,241.87

$ 1,061,241.87

0.00

125,567.10

$

146.845.04

146,845.04

0.00

$

674,707.50 $ 1,061,241.87 $

146,845.04 $ 1,208.086.91

$ 20,021,497.60 $ 24,400.172.53 $ 1,103,149.90 $ 25,503.322.43 $

0.00

$

65,383.00

159,754.00

225,137.00

$ . 200,706.78 $ 24,430.22

200,706.78 24,430.22

===-======= $

225.137.00 $

225,137.00 $ ......

0.00

29

SECTIONll COMPLIANCE AND INTERNAL CONTROL REPORTS

RUSSELL W. HINTON
STATEAUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
April 1, 1999

Honorable Roy E. Barnes, 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 ofEducation as of and for the year ended June 30, 1998, and have issued our report thereon dated April 1, 1999. 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 financial 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, 1998, 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 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 that are required to be reported under Government Auditing Standards.

98YB-40

InternalControl Over FinancialReporting
In planning and performing our audit, we considered CatoosaCountyBoard of Education's internal control overfinancial 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 fmancial reporting. However, we noted a certain matterinvolving the internalcontrol over financial reporting and its operation that we considerto be a reportable condition. Reportable conditions involve matterscomingto our attention relating to significantdeficiencies in the design or operationof the internal control over fmancial reporting that, in ourjudgement, couldadversely affect Catoosa County BoardofEducation's abilityto 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-6231-98-0I.
A material weakness is a conditionin which the design or operationof 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 auditedmay occur and not be detectedwithin a timely periodby employees in the normal course of performing their assigned functions. Our consideration of the internal controlover financial reporting wouldnot necessarily disclose all matters in the internal control that mightbe reportable conditions and accordingly, wouldnot necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, the reportable condition noted above is considered to be a material weakness.
This report is intended for the information of management, the Federal cognizantagency, Federal awarding agencies and pass throughentities. Thisrestriction is not intended to limitthe distribution ofthis reportwhich is a matter of public record.
Respectfully submitted,
~4~W.~ Russell W. Hinton State Auditor
RWH:jb 98YB-40

RUSSELL W. HINTON
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
April 1, 1999

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Catoosa County Board ofEducation
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM ANDINTERNAL CONTROL OVER COMPLIANCE INACCORDANCE WITHOMB 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 ofManagement and Budget (OME) Circular A-133 Compliance
Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1998. Catoosa County Board ofEducation's major Federal programs are identified in the 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 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.

98SA-1O

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, 1998.
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 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 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.
Respectfully submitted,
~... eEl W. ~:$;
Russell W. Hinton State Auditor
RWH:jb 98SA-1O

SECTION ill AUDITEE'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, 1998

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

6231-93-02 6231-96-01 FS-6231-97-01 FS-6231-97-02

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

CORRECTIVE ACTIONIRESPONSES

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.

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6231-97-02

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.

SECTION IV FINDINGS AND QUESTIONED COSTS

CATOOSACOUNTYBOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 1998

I SUMMARY OF AUDITOR'S RESULTS

1. Type of Report Issued on the Financial Statements The auditor's opinionon the Catoosa County BoardofEducation's financial statements was qualified for a scope limitation and for various departuresfrom generally accepted accountingprinciples.

2. Reportable Conditions in Internal ControlDisclosedby the Audit of the Financial Statements The audit reportfor the CatoosaCounty Boardof Education disclosed a financial statement reportable condition related to the following control category.

General Fixed Assets

The reportable condition describedabove is considered to be a material weakness.

3. NoncomplianceMaterial to the Financial Statements The audit ofthe Catoosa CountyBoard of Educationdisclosedno instancesof noncompliance that were deemed to be material to the financial statements.

4. Reportable Conditions in Internal Control Over Major Programs The audit reportforthe CatoosaCountyBoardof Education did not disclose anyreportable 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 applicableto major programswas unqualified.

-

6. Audit Findings Requiredto be Reportedby Section .51O(a) ofOMB CircularA-133 The CatoosaCountyBoardof Education's auditdid not disclose auditfindings required to be reported by section .51O(a) ofOMB CircularA-133.

7. Major Programs Federal awards audited as major programsare as follows: 84.010 Elementary and Secondary Education Act - TitleI - Grantsto LocalEducational Agencies 84.027 Individuals with Disabilities Education Act - Part B - Special Education - Flow Through 84.173 Individualswith Disabilities EducationAct - Part B - SpecialEducation - Preschool 84.027 Individuals withDisabilities Education Act- PartB - Special Education - SpecialProjects

8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.

9. Low Risk Auditee The CatoosaCountyBoardofEducation was audited as a low risk auditee basedon a waivergranted by the U. S. DepartmentofEducation.

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CATOOSACOUNTYBOARD OF EDUCATION SCHEDULE OF FINDINGS AND OUESTIONED COSTS
YEAR ENDED JUNE 30, 1998
II FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS GENERALFIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated from Prior Year Finding Control Number: FS-6231-98-01 The Catoosa County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accountingrecords as required by generallyaccepted accountingprinciples. 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 establishaccounting controls and procedures to provide for maintenance ofa General Fixed AssetsAccount Group. These subsidiary records shouldinclude an inventory ofland, buildings and equipment ownedby 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 maintainedof all additions and deletions to the General Fixed Assets Account Group. Management's Response: Our systemhas giventhe subjectto fixed asset accounting a lot ofthought. At this time we do not have the means ofsettingup this accountgroup. At suchtime as the stateprovides us with the programto do this we will begin the task of accountingfor our fixed assets. ill FEDERAL AWARD FINDINGS AND OUESTIONED COSTS No matters were reported.
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