Charlton County Board of Education, Folkston, Georgia, annual financial report for the fiscal year ended June 30, 2017 (including independent auditor's reports)

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CHARLTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017
The discussion and analysis of the Charlton County Board of Education's financial performance provides an overall review of the Board's financial activities for the fiscal year ended June 30, 2017. The intent of this discussion and analysis is to look at the Board's financial performance as a whole; readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the Board's financial performance.
Financial Highlights
Key financial highlights for fiscal year 2017 are as follows: In total, net position increased $267 thousand, which represents a 2.1 percent increase from
fiscal year 2016. This increase is mainly due to long-term debt liability decreasing from last year. General revenues accounted for $6.8 million in revenues. Program specific revenues in the form
of charges for services, operating and capital grants and contributions accounted for $12.0 million. Total revenues were $18.8 million, which is an increase from 2016 of $645 thousand. The Board had $18.5 million in expenses related to governmental activities. General revenues, primarily taxes, of $6.8 million were adequate to provide for these programs. Among major funds, the general fund had $17.7 million in revenues and $17.4 million in expenditures. The general fund's balance increased from $3.3 million to $3.6 million. This can be attributed to a net increase in revenues versus expenditures.
Using the Basic Financial Statements
This annual report consists of a series of financial statements and notes to those statements. These statements are organized so the reader can understand the Charlton County Board of Education as a financial whole, or as an entire operating entity. The basic financial statements include two levels of statements that present different views of the Board. These include the government-wide and fund financial statements.
The government-wide financial statements include the Statement of Net Position and Statement of Activities. These statements provide information about the activities of the whole Board, presenting both short-term and long-term information about the Board's overall financial status.
The fund financial statements focus on individual parts of the Board, reporting the Board's operation in more detail. The Governmental Funds statements disclose how basic services are financed in the short-term as well as what remains for future spending. The fund financial statements reflect the Board's most significant funds. In the case of the Charlton County Board of Education, the general fund is by far the most significant fund.
i

CHARLTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Reporting the Board as a Whole
Statement of Net Position and Statement of Activities
While these documents contain the large number of funds used by the Board to provide programs and activities, the view of the Board as a whole looks at all financial transactions and asks the question, "How did we do financially during fiscal year 2017?" The Statement of Net Position and the Statement of Activities answer this question. These statements include all assets and all liabilities using the accrual basis of accounting similar to the accounting used by most private-sector companies. This basis of accounting takes into account all of the current year's revenues and expenses regardless of when cash is received or paid.
These two statements report the Board's net position and changes in the net position. The change in net position is important because it tells the reader whether, for the Board as a whole, the financial position of the Board has improved or diminished. The causes of this change may be the result of many factors, including those not under the Board's control, such as the property tax base, facility conditions, required educational programs and other factors.
The Statement of Net Position and the Statement of Activities reflects the Board's governmental activities.
Reporting the Board's Most Significant Funds
Fund Financial Statements
Fund financial statements provide detailed information about the Board's major funds. The Board uses many funds to account for a multitude of financial transactions. However, these fund financial statements focus on the Board's most significant funds. The Board's major governmental funds are the general fund, the capital projects fund, and the debt service fund.
Governmental Funds Most of the Board's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using the modified accrual method of accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the Board's general government operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds is reconciled in the financial statements.
Fiduciary Funds The School District is the trustee, or fiduciary, for assets that belong to others, such as school clubs and organizations within the school activity accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the governmentwide financial statements because it cannot use these assets to finance its operations.
ii

CHARLTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017

Financial Analysis of the Board as a Whole

The perspective of the Statement of Net Position is of the Board as a whole. Table 1 provides a summary of the Board's net position for fiscal year 2017 as compared to net position for fiscal year 2016.
Table 1
Net Position

Assets Current and Other Assets Capital Assets, Net

Governmental Activities

Fiscal Year

Fiscal Year

2017

2016

$

8,116,827.00 $

19,856,379.00

7,956,503.00 20,428,314.00

Total Assets

27,973,206.00

28,384,817.00

Deferred Outflows of Resources Related to Defined Benefit Pension Plan

3,934,857.00

1,262,206.00

Liabilities Current and Other Liabilities Long-Term Liabilities

1,727,564.00 16,866,711.00

1,709,586.00 13,859,797.00

Total Liabilities

18,594,275.00

15,569,383.00

Deferred Inflows of Resources Related to Defined Benefit Pension Plan

157,700.00

1,188,444.00

Net Position Investment in Capital Assets Restricted Unrestricted (Deficit)

19,856,379.00 2,688,745.00 (9,389,036.00)

19,743,024.00 2,849,701.00 (9,703,529.00)

Total Net Position

$ 13,156,088.00 $

12,889,196.00

Total net position increased $267 thousand.

iii

CHARLTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017

Table 2 shows the changes in net position for fiscal year 2017 as compared to fiscal year 2016.

Table 2 Change in Net Position

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

Governmental Activities

Fiscal Year

Fiscal Year

2017

2016

$

224,483.00 $

11,670,744.00

77,216.00

281,549.00 10,934,971.00
78,678.00

Total Program Revenues:

11,972,443.00

11,295,198.00

General Revenues:
Taxes
Property Taxes
For Maintenance and Operations Railroad Cars Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects and Debt Services Other Taxes Grants and Contributions Not Restricted to Specific Programs (Equilization) Investment Earnings Miscellaneous
Special Item Lawsuit Settlement

5,191,564.00 44,307.00
1,079,544.00 32,121.00
202,144.00 1,957.00
278,343.00
-

5,178,228.00 44,226.00
1,055,070.00 27,393.00
471,009.00 2,391.00
293,436.00
(210,000.00)

Total General Revenues and Special Item

6,829,980.00

6,861,753.00

Total Revenues

18,802,423.00

18,156,951.00

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

11,153,930.00
721,243.00 767,907.00 425,845.00 715,909.00 1,063,941.00 130,262.00 1,430,712.00 958,068.00
82,379.00 33,251.00
991,404.00 60,680.00

10,146,676.00
693,573.00 670,500.00 392,942.00 510,696.00 995,647.00 125,843.00 1,435,043.00 957,133.00
72,439.00 38,315.00
1,021,672.00 93,498.00

Total Expenses

18,535,531.00

17,153,977.00

Increase in Net Position

$

266,892.00 $

1,002,974.00

iv

CHARLTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017

Governmental Activities
Instruction comprises 60.2 percent of governmental program expenses.
The Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services. That is, it identifies the cost of these services supported by tax revenue and by unrestricted State entitlements.

Table 3 Governmental Activities

Total Cost of Services

Fiscal Year 2017

Fiscal Year 2016

Net Cost of Services

Fiscal Year

Fiscal Year

2017

2016

Instruction

$

Support Services

Pupil Services

Improvement of Instructional Services

Educational Media Services

General Administration

School Administration

Business Administration

Maintenance and Operation of Plant

Student Transportation Services

Central Support Services

Other Support Services

Operations of Non-Instructional Services

Food Services

Interest on Short-Term and Long-Term Debt

11,153,930.00 $
721,243.00 767,907.00 425,845.00 715,909.00 1,063,941.00 130,262.00 1,430,712.00 958,068.00
82,379.00 33,251.00
991,404.00 60,680.00

10,146,676.00 $
693,573.00 670,500.00 392,942.00 510,696.00 995,647.00 125,843.00 1,435,043.00 957,133.00
72,439.00 38,315.00
1,021,672.00 93,498.00

3,290,873.00 $
572,595.00 161,681.00 136,688.00 268,918.00 372,356.00 125,759.00 848,198.00 556,954.00
79,544.00 25,832.00
63,010.00 60,680.00

2,679,242.00
563,857.00 255,474.00 117,952.00
75,104.00 308,550.00 121,990.00 868,539.00 639,488.00
69,260.00 20,180.00
45,645.00 93,498.00

Total Expenses

$

18,535,531.00 $

17,153,977.00 $

6,563,088.00 $

5,858,779.00

Although program revenues make up 64.0 percent of the revenues, the Board is still dependent upon tax revenues for governmental activities.
The Board's Funds
The Board's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues of $18.8 million and expenditures of $18.7 million. The general fund had an increase of $359 thousand, excluding the other financing uses.
General Fund Budgeting Highlights
The Board's budget is prepared according to Georgia law. The most significant budgeted fund is the general fund.

v

CHARLTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017

The Board uses a school-based budgeting concept based on FTE student allocations. The budgeting systems are designed to tightly control total school budgets but provide flexibility for school-level decision making.

For the general fund, actual revenues and other sources of $17.7 million exceeded the final budget of $17.2 million by $556 thousand. This difference was due to a combination of factors, but primarily due to increased property taxes, federal revenues, and the reporting of school activity accounts.

Capital Assets and Debt Administration

Capital Assets

At the end of fiscal year 2017, the Board had $19.9 million invested in capital assets, all in governmental activities. Table 4 shows balances for fiscal year 2017 as compared to balances for fiscal year 2016.
Table 4
Capital Assets
(Net of Depreciation)

Land Buildings and Improvements Equipment Land Improvements Intangible Assets

Governmental Activities

Fiscal Year 2017

Fiscal Year 2016

$

553,795.00 $

560,127.00

17,908,402.00

18,344,209.00

941,444.00

1,015,701.00

447,738.00

503,277.00

5,000.00

5,000.00

Total

$ 19,856,379.00 $ 20,428,314.00

Due to the steady collection of Special Purpose Local Option Sales Tax (SPLOST) revenues and the commitment of local funds to capital outlay projects, the Board has completed numerous construction projects and continues with the capital improvements program.

Debt

At June 30, 2017, the Board had $1.2 million in bonds outstanding due within one year. Table 5 shows balances for fiscal year 2017 as compared to balances for fiscal year 2016. These bonds will be paid off in April, 2018. Charlton County passed a new SPLOST referendum in April 2017.

Table 5 Debt Administration at June 30

Governmental Activities

Fiscal Year 2017

Fiscal Year 2016

General Obligation Bonds

$ 1,185,000.00

$ 2,320,000.00

vi

CHARLTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 Current Issues The following issues are expected to have a significant effect on the financial positions or results of operations: State and Local Economy Although the State of Georgia continues to experience more stable economic conditions, state funding for education continues to reflect austerity reductions which began in fiscal year 2003. However, because the Charlton County School District has taken a proactive approach in managing the School District's finances through prioritization of educational programs, the School District continues to have a strong financial position. Further, the Special Purpose Local Option Sales Tax collections remain on target to meet bond obligations. The Charlton County Board of Education is optimistic about the ability of the School Board to maximize all of the financial resources to provide a quality education to our students. Capital Improvements The Charlton County Board of Education has successfully passed five SPLOST referenda and has completed numerous capital projects. Contacting the Board's Financial Management This financial report is designed to provide our citizens, taxpayers, investors, and creditors with a general overview of the Board's finances and to show the Board's accountability for the money it receives. If you have questions about this report or need additional information, contact Patsy Allen, at the Charlton County Board of Education, 1259 Third Street Folkston, Georgia 31337. You may also email any questions to Pallen@Charlton.k12.ga.us, or visit our website at www.Charlton.k12.ga.us.
vii

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CHARLTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2017
ASSETS
Cash and Cash Equivalents Investments Accounts Receivable, Net
Taxes State Government Federal Government Other Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation)
Total Assets
DEFERRED OUTFLOWS OF RESOURCES
Related to Defined Benefit Pension Plan
LIABILITIES
Salaries and Benefits Payable Interest Payable Deposits and Unearned Revenue Net Pension Liability Long-Term Liabilities
Due Within One Year
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Related to Defined Benefit Pension Plan
NET POSITION
Investment in Capital Assets Restricted for
Continuation of Federal Programs Debt Service Capital Projects Unrestricted (Deficit)
Total Net Position

EXHIBIT "A"

GOVERNMENTAL ACTIVITIES

$

6,137,569.67

64,222.01

469,478.15 1,130,194.85
269,517.18 7,412.40
38,432.52 553,794.53 19,302,584.23

27,973,205.54

3,934,857.37

1,699,506.02 8,828.25
19,229.58 15,681,711.00
1,185,000.00
18,594,274.85

157,700.00

19,856,378.76
129,170.49 8,828.25
2,550,745.73 (9,389,035.17)

$

13,156,088.06

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

- 1 -

CHARLTON COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2017

GOVERNMENTAL ACTIVITIES
Instruction Support Services
Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Food Services Interest on Short-Term and Long-Term Debt
Total Governmental Activities
General Revenues Taxes Property Taxes For Maintenance and Operations Railroad Cars Sales Taxes Special Purpose Local Option Sales Tax Other Sales Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Total General Revenues
Change in Net Position
Net Position - Beginning of Year
Net Position - End of Year

EXPENSES

CHARGES FOR SERVICES

$ 11,153,930.02 $
721,243.07 767,906.84 425,845.11 715,908.67 1,063,940.90 130,261.34 1,430,712.22 958,068.32
82,378.83 33,251.05
991,404.28 60,680.25
$ 18,535,530.90 $

106,325.08
-
118,158.30 -
224,483.38

- 2 -

EXHIBIT "B"

PROGRAM REVENUES OPERATING GRANTS AND
CONTRIBUTIONS

CAPITAL GRANTS AND CONTRIBUTIONS

NET (EXPENSES) REVENUES
AND CHANGES IN NET POSITION

$

7,756,732.02 $

148,648.14 606,225.58 289,157.35 446,990.96 691,584.33
4,502.29 582,514.48 323,898.52
2,834.73 7,418.77

810,236.37 -

$ 11,670,743.54 $

- $
77,216.25 -
-
77,216.25

(3,290,872.92)
(572,594.93) (161,681.26) (136,687.76) (268,917.71) (372,356.57) (125,759.05) (848,197.74) (556,953.55)
(79,544.10) (25,832.28)
(63,009.61) (60,680.25)
(6,563,087.73)

5,191,564.16 44,307.35
1,079,543.74 32,121.21
202,144.00 1,956.71
278,342.63
6,829,979.80
266,892.07
12,889,195.99

$

13,156,088.06

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

- 3 -

CHARLTON COUNTY BOARD OF EDUCATION BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2017

EXHIBIT "C"

ASSETS
Cash and Cash Equivalents Investments Accounts Receivable, Net
Taxes State Government Federal Government Other Inventories
Total Assets
LIABILITIES
Salaries and Benefits Payable Deposits and Unearned Revenue
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Unavailable Revenue - Property Taxes
FUND BALANCES
Nonspendable Restricted Assigned Unassigned
Total Fund Balances

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$ 3,660,196.81 $ 2,468,544.61 $

64,222.01

-

378,448.78 1,130,194.85
269,517.18 7,412.40
38,432.52

91,029.37 -

8,828.25 $ 6,137,569.67

-

64,222.01

-

469,478.15

-

1,130,194.85

-

269,517.18

-

7,412.40

-

38,432.52

$ 5,548,424.55 $ 2,559,573.98 $

8,828.25 $ 8,116,826.78

$ 1,699,506.02 $ 19,229.58
1,718,735.60

- $ -
-

- $ 1,699,506.02

-

19,229.58

-

1,718,735.60

189,822.55

-

-

189,822.55

38,432.52 90,737.97 123,834.63 3,386,861.28
3,639,866.40

2,559,573.98
-
2,559,573.98

8,828.25
-
8,828.25

38,432.52 2,659,140.20
123,834.63 3,386,861.28
6,208,268.63

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 5,548,424.55 $ 2,559,573.98 $

8,828.25 $ 8,116,826.78

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

- 4 -

CHARLTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET POSITION JUNE 30, 2017

EXHIBIT "D"

Total fund balances - governmental funds (Exhibit "C")
Amounts reported for governmental activities in the Statement of Net Position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds.
Land Buildings and improvements Equipment Land improvements Intangible assets Accumulated depreciation
Some liabilities are not due and payable in the current period and, therefore, are not reported in the funds.
Net pension liability
Deferred outflows and inflows of resources related to pensions are applicable to future periods and, therefore, are not reported in the funds.
Taxes that are not available to pay for current period expenditures are deferred in the funds.
Long-term liabilities, and related accrued interest, are not due and payable in the current period and therefore are not reported in the funds.
Bonds payable Accrued interest payable

$

6,208,268.63

$

553,794.53

25,183,125.05

3,553,990.41

1,697,071.66

50,000.00

(11,181,602.89)

19,856,378.76

(15,681,711.00) 3,777,157.37 189,822.55

$ (1,185,000.00) (8,828.25)

(1,193,828.25)

Net position of governmental activities (Exhibit "A")

$ 13,156,088.06

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

- 5 -

CHARLTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2017

EXHIBIT "E"

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

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$ 5,273,670.75 $

- $

32,121.21

1,079,543.74

9,388,041.53

-

2,551,885.65

-

224,483.38

-

208.33

1,748.38

278,342.63

-

17,748,753.48

1,081,292.12

- $ 5,273,670.75

-

1,111,664.95

-

9,388,041.53

-

2,551,885.65

-

224,483.38

-

1,956.71

-

278,342.63

-

18,830,045.60

10,241,956.08
703,790.03 756,198.39 415,232.95 676,808.55 1,028,552.45 125,963.86 1,469,980.92 935,043.38
79,309.20 33,251.05 923,810.94
-
-
17,389,897.80
358,855.68

-
64,322.29
-
64,322.29
1,016,969.83

-
-
1,135,000.00 69,136.00
1,204,136.00
(1,204,136.00)

10,241,956.08
703,790.03 756,198.39 415,232.95 676,808.55 1,028,552.45 125,963.86 1,469,980.92 935,043.38
79,309.20 33,251.05 923,810.94 64,322.29
1,135,000.00 69,136.00
18,658,356.09
171,689.51

-
358,855.68 3,281,010.72

(1,195,680.25) (1,195,680.25)
(178,710.42) 2,738,284.40

1,195,680.25 -
1,195,680.25
(8,455.75) 17,284.00

1,195,680.25 (1,195,680.25)
-
171,689.51 6,036,579.12

$ 3,639,866.40 $ 2,559,573.98 $

8,828.25 $ 6,208,268.63

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

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CHARLTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2017

EXHIBIT "F"

Net change in fund balances total governmental funds (Exhibit "E")
Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense.
Capital outlay Depreciation expense
The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position.
Taxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities.
Bond principal retirements
District pension contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension liability is measured a year before the District's report date. Pension expense, which is the change in the net pension liability adjusted for changes in deferred outflows and inflows of resources related to pensions, is reported in the Statement of Activities.
Pension expense
Some items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds.
Accrued interest on issuance of bonds
Change in net position of governmental activities (Exhibit "B")

$ 171,689.51

$ 111,153.90 (676,757.22)

(565,603.32)

(6,332.00)

(37,799.24)

1,135,000.00
(438,518.63) 8,455.75
$ 266,892.07

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

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ASSETS Cash and Cash Equivalents
LIABILITIES Funds Held for Others

CHARLTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION FIDUCIARY FUNDS JUNE 30, 2017

EXHIBIT "G"

AGENCY FUNDS

$

44,315.58

$

44,315.58

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

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
REPORTING ENTITY
The Charlton County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below.
BASIS OF PRESENTATION
The School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness.
GOVERNMENT-WIDE STATEMENTS:
The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions.
The Statement of Net Position presents the School District's non-fiduciary assets and liabilities, with the difference reported as net position. Net position is reported in three categories as follows:
1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets.
2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation.
3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net positon often has constraints on resources imposed by management which can be removed or modified.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities.
Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs.

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
FUND FINANCIAL STATEMENTS
The fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate financial statements are presented for governmental and fiduciary funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column.
The School District reports the following major governmental funds:
x The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund.
x The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST) that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets.
x The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes (sales) legally restricted for the payment of general long-term principal and interest.
The School District reports the following fiduciary fund type:
x Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve measurement of results of operations.
BASIS OF ACCOUNTING
The basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes and grants. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities are reported as other financing sources.
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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

The School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues.
NEW ACCOUNTING PRONOUNCEMENTS
In fiscal year 2017, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 77, Tax Abatement Disclosures. This statement requires governments that enter into tax abatement agreements to disclose the following information; (1) brief descriptive information, such as the tax being abated, the authority under which tax abatements are provided, eligibility criteria, the mechanism by which taxes are abated, provisions for recapturing abated taxes, and the types of commitments made by tax abatement recipients; (2) the gross dollar amount of taxes abated during the period; and (3) commitments made by a government, other than to abate taxes, as part of a tax abatement agreement. The adoption of this statement does not have a significant impact on the School District's financial statements.
In fiscal year 2017, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 80, Blending Requirements for Certain Component Units an amendment of GASB Statement No. 14. This statement amends the blending requirements for the financial statement presentation of component units of all state and local governments. The additional criterion requires blending of a component unit incorporated as a not-for-profit corporation in which the primary government is the sole corporate member. The additional criterion does apply to component units included in the financial reporting entity pursuant to the provisions of Statement No. 39, Determining Whether Certain Organization Are Component Units. The adoption of this statement does not have a significant impact on the School District's financial statements.
In fiscal year 2017, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 82, Pension Issues an amendment of GASB Statements No. 67, No. 68 and No. 73. This statement addresses certain issues that have been raised with respect to Statements No. 67, Financial Reporting for Pension Plans, No. 68, Accounting and Financial Reporting for Pensions, and No. 73, Accounting and Financial Reporting for Pensions and Related Assets That Are Not within the Scope of GASB Statement No. 68, and Amendments to Certain Provisions of GASB Statements No. 67 and No. 68. Specifically, this statement addresses issues regarding (1) the presentation of payroll-related measures in required supplementary information, (2) the selection of assumptions and the treatment of deviations from the guidance in an Actuarial Standard of Practice for financial reporting purposes, and (3) the classification of payments made by employers to satisfy employee (plan member) contribution requirements. The adoption of this statement does not have a significant impact on the School District's financial statements.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations.
INVESTMENTS
The School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity.

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interestearning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value.

For accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired.

RECEIVABLES
Receivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.

INVENTORIES

Food Inventories
On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the first-in, first-out basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used.

CAPITAL ASSETS
On the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art.

Capital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements.

Depreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives.

Capitalization thresholds and estimated useful lives of capital assets reported in the governmentwide statements are as follows:

Capitalization Policy

Estimated Useful Life

Land

Any Amount

Land Improvements

$

100,000.00

Buildings and Improvements $

100,000.00

Equipment

$

5,000.00

Intangible Assets

$

10,000.00

N/A 15 years
10 to 60 years 5 to 15 years
10 to 20 years

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

DEFERRED OUTFLOWS/INFLOWS OF RESOURCES
In addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element, represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time.
LONG-TERM LIABILITIES AND BOND DISCOUNTS/PREMIUMS
In the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the straight-line method. To conform to generally accepted accounting principles, bond premiums and discounts should be amortized using the effective interest method. The effect of this deviation is deemed to be immaterial to the fair presentation of the basic financial statements. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued.
In the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures.
PENSIONS
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
FUND BALANCES
Fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent.
The School District's fund balances are classified as follows:
Nonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact.
Restricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation.
Committed consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Assigned consists of resources constrained by the School District's intent to be used for specific purposes, but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes.

Unassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance.

USE OF ESTIMATES
The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.

PROPERTY TAXES
The Charlton County Board of Commissioners adopted the property tax levy for the 2016 tax digest year (calendar year) on October 20, 2016 (levy date) based on property values as of January 1, 2016. Taxes were due on December 20, 2016 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2016 tax digest are reported as revenue in the governmental funds for fiscal year 2017. The Charlton County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2017, for maintenance and operations amounted to $4,804,075.60.

The tax millage rate levied for the 2016 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

17.45 mills

Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $425,287.80 during fiscal year ended June 30, 2017.
SALES TAXES
Education Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $1,079,543.74 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be reauthorized at least every five years.
NOTE 3: BUDGETARY DATA
The budget is a complete financial plan for the School District's fiscal year, and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general fund. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds, except the various school activity (principal) accounts, is prepared and adopted by fund and function. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America.

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

The budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines, and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
See the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review.
NOTE 4: DEPOSITS
COLLATERALIZATION OF DEPOSITS
O.C.G.A. 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance.
Acceptable security for deposits consists of any one of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

CATEGORIZATION OF DEPOSITS
Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2017, the School District had deposits with a carrying amount of $6,246,107.26, and a bank balance of $6,891,227.46. The bank balances insured by Federal depository insurance were $564,222.01 and the bank balances collateralized with securities held by the pledging financial institution's trust department or agent in the School District's name were $6,327,005.45.
Reconciliation of cash and cash equivalents balances to carrying value of deposits:

Statement of Net Position Cash and cash equivalents
Statement of Fiduciary Net Position Cash and cash equivalents

$ 6,137,569.67 44,315.58

Total cash and cash equivalents

6,181,885.25

Add: Deposits with original maturity of three months or more reported as investments

64,222.01

Total carrying value of deposits - June 30, 2017

$ 6,246,107.26

NOTE 5: CAPITAL ASSETS
The following is a summary of changes in the capital assets for governmental activities during the fiscal year:

Balances July 1, 2016

Increases

Decreases

Balances June 30, 2017

Governmental Activities Capital Assets, Not Being Depreciated:
Land

$

560,126.53 $

- $ 6,332.00 $

553,794.53

Capital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements Intangible Assets
Less Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements Intangible Assets
Total Capital Assets, Being Depreciated, Net
Governmental Activity Capital Assets - Net

25,183,125.05 3,442,836.51 1,697,071.66 50,000.00

111,153.90
-

-

25,183,125.05

-

3,553,990.41

-

1,697,071.66

-

50,000.00

6,838,915.23 2,427,135.68 1,193,794.80
44,999.96

435,808.00 185,410.39
55,538.83 -

-

7,274,723.23

-

2,612,546.07

-

1,249,333.63

-

44,999.96

19,868,187.55

(565,603.32)

-

19,302,584.23

$ 20,428,314.08 $ (565,603.32) $ 6,332.00 $ 19,856,378.76

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Current year depreciation expense by function is as follows:

Instruction

Support Services

General Administration

$

Maintenance and Operation of Plant

Student Transportation Services

Food Services

15,478.86 2,984.44
83,326.90

$ 517,480.33
101,790.20 57,486.69

$ 676,757.22

NOTE 6: INTERFUND TRANSFERS INTERFUND TRANSFERS Interfund transfers for the year ended June 30, 2017, consisted of the following:

Transfers to

Transfers From Capital Projects
Fund

Debt Service Fund

$ 1,195,680.25

Transfers are used to move sales tax revenues collected by the capital projects fund to the debt service fund to pay bond principal and interest payments.
NOTE 7: LONG-TERM LIABILITIES The changes in long-term liabilities during the fiscal year for governmental activities, were as follows:

General Obligation Bonds

Balance July 1, 2016

$GGLWLRQV

Governmental Activities

Balance

Deductions

June 30, 2017

Due Within One Year

$ 2,320,000.00 $

- $ 1,135,000.00 $ 1,185,000.00 $ 1,185,000.00

GENERAL OBLIGATION DEBT OUTSTANDING
The School District's bonded debt consists of general obligation bonds that are generally noncallable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voter-approved sales taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District.
During the current fiscal year, the voters of Charlton County authorized $4,000,000.00 in general obligation bonds that were not issued as of June 30, 2017. The primary purpose of the bonds is to pay for acquiring or constructing capital facilities.
General obligation bonds currently outstanding are as follows:

Description

Interest Rate

Issue Date

Maturity Date

Amount Issued

Amount Outstanding

General Government - Series 2008

2.98%

3/19/2008

4/1/2018 $ 9,000,000.00 $ 1,185,000.00

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

The following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable:

Fiscal Year Ended June 30:

General Obligation Debt

Principal

Interest

2018

$ 1,185,000.00 $

35,313.00

NOTE 8: RISK MANAGEMENT

INSURANCE

Commercial Insurance
The School District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors or omissions; job related illness or injuries to employees; and natural disasters. Except as described below, the School District carries commercial insurance for these risks. Settled claims resulting from these insured risks have not exceeded commercial insurance coverage in any of the past three fiscal years.

The School District has elected to self-insure for losses related to natural disasters. The School District has not experienced any losses related to this risk in the past three years.

UNEMPLOYMENT COMPENSATION
The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. The School District had no unemployment compensation claims in the past two years.

SURETY BOND The School District purchased a surety bond to provide additional insurance coverage as follows:

Position Covered

Amount

Superintendent

$ 50,000.00

NOTE 9: FUND BALANCE CLASSIFICATION DETAILS
The School District's financial statements include the following amounts presented in the aggregate at June 30, 2017:

Nonspendable Inventories
Restricted Continuation of Federal programs Capital projects Debt service Other - family connection
Assigned School activity accounts
Unassigned

$ 38,432.52

$

89,464.95

2,550,745.73

17,656.50

1,273.02

2,659,140.20

123,834.63 3,386,861.28

Fund Balance, June 30, 2017

$ 6,208,268.63

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CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

When multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds.
NOTE 10: BROADBAND SPECTRUM LEASE
The School District entered into a lease agreement with Clearwise Spectrum Holdings II LLC for the lease of excess spectrum capacity on Education Broadband Service licenses currently held by the School District. The lease agreement was for 30 years. The license was granted to the School District by the Federal Communications Commission. The lease agreement requires annual lease payments over the term of the leases, of which $39,019.23 was recognized during fiscal year 2017 as a general revenue on the Statement of Activities.
NOTE 11: SIGNIFICANT CONTINGENT LIABILITIES
FEDERAL GRANTS
Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position.
LITIGATION
The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to have a material adverse effect on the financial condition of the School District.
NOTE 12: POST-EMPLOYMENT BENEFITS
GEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND
Plan Description. The Georgia School Personnel Post-Employment Health Benefit Fund (School OPEB Fund) is a cost-sharing multiple-employer defined benefit post-employment healthcare plan that covers eligible former employees of public school systems, libraries and regional educational service agencies. The School OPEB Fund provides health insurance benefits to eligible former employees and their qualified beneficiaries through the State Employees Health Benefit Plan administered by the Department of Community Health. The Official Code of Georgia Annotated (O.C.G.A.) assigns the authority to establish and amend the benefit provisions of the group health plans, including benefits for retirees, to the Board of Community Health (Board). Additional information about the School OPEB Fund is disclosed in the State of Georgia Comprehensive Annual Financial Report. This report can be obtained from the Georgia Department of Audits and Accounts at www.audits.ga.gov/SGD/CAFR.html.
Funding Policy. The contribution requirements of plan members and participating employers are established by the Board in accordance with the current Appropriations Act and may be amended by the Board. Contributions of plan members or beneficiaries receiving benefits vary based on plan election, dependent coverage, and Medicare eligibility and election. For members with fewer than five years of service as of January 1, 2012, contributions also vary based on years of service. On average, members with five years or more of service as of January 1, 2012 pay approximately 25% of the cost of the health insurance coverage. In accordance with the Board resolution dated December 8, 2011, for members with fewer than five years of service as of January 1, 2012, the State provides a premium subsidy in retirement that ranges from 0% for fewer than 10 years of service to 75% (but no greater than the subsidy percentage offered to active employees) for 30 or more years of service. The subsidy for eligible dependents ranges from 0% to 55% (but no greater than the subsidy percentage offered to dependents of active employees minus 20%). No subsidy is available to Medicare eligible members not enrolled in a Medicare Advantage Option. The Board of
- 19 -

CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Community Health sets all member premiums by resolution and in accordance with the law and applicable revenue and expense projections. Any subsidy policy adopted by the Board may be changed at any time by Board resolution and does not constitute a contract or promise of any amount of subsidy.

Participating employers are statutorily required to contribute in accordance with the employer contribution rates established by the Board. The contribution rates are established to fund all benefits due under the health insurance plans for both active and retired employees based on projected "pay-as-you-go" financing requirements. Contributions are not based on the actuarially determined employer contribution (ADEC) which represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years.

The combined active and retiree contribution rates established by the Board for employers participating in the School OPEB Fund were as follows for the fiscal year ended June 30, 2017:

For certificated teachers, librarians and regional educational service agencies and certain other eligible participants:

July 1, 2016 June 30, 2017

$945.00 per member per month

For non-certificated school personnel:
July 1, 2016 December 31, 2016 $746.20 per member per month
January 1, 2017 June 30, 2017 $846.20 per member per month
No additional contribution was required by the Board for fiscal year 2017 nor contributed to the School OPEB Fund to prefund retiree benefits. Such additional contribution amounts are determined annually by the Board in accordance with the School plan for other post-employment benefits and are subject to appropriation.
The School District's combined active and retiree contributions to the health insurance plans, which equaled the required contribution, for the current fiscal year and the preceding two fiscal years were as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2017 2016 2015

100%

$

100%

$

100%

$

1,637,149.80 1,575,054.88 1,432,018.40

NOTE 13: RETIREMENT PLANS
The School District participates in various retirement plans administered by the State of Georgia, as further explained below.
TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)
Plan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial audit report that can be obtained at www.trsga.com/publications.

- 20 -

CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Benefits Provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.
Contributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2017. The School District's contractually required contribution rate for the year ended June 30, 2017 was 14.27% of annual School District payroll, of which 14.06% of payroll was required from the School District and 0.21% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $1,227,615.37 and $18,147.39 from the School District and the State, respectively.
PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS)
Plan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs.
Benefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service.
Upon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits.
Contributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.

- 21 -

CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Individuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $32,031.00.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions
At June 30, 2017, the School District reported a liability of $15,681,711.00 for its proportionate share of the net pension liability for TRS.
The TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows:

School District's proportionate share of the net pension liability

$ 15,681,711.00

State of Georgia's proportionate share of the net pension liability associated with the School District

234,782.00

Total

$ 15,916,493.00

The net pension liability for TRS was measured as of June 30, 2016. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2015. An expected total pension liability as of June 30, 2016 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS during the fiscal year ended June 30, 2016.
At June 30, 2016, the School District's TRS proportion was 0.076010%, which was an increase of 0.000210% from its proportion measured as of June 30, 2015.
At June 30, 2017, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $227,089.00.
The PSERS net pension liability was measured as of June 30, 2016. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2015. An expected total pension liability as of June 30, 2016 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2016.
For the year ended June 30, 2017, the School District recognized pension expense of $1,689,212.00 for TRS and $37,228.00 for PSERS and revenue of $23,127.00 for TRS and $37,228.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel.

- 22 -

CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

At June 30, 2017, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS
Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual experience

$

233,615.00 $ 77,546.00

Changes of assumptions

406,448.00

-

Net difference between projected and actual

earnings on pension plan investments

1,983,801.00

-

Changes in proportion and differences between School District contributions and proportionate share of contributions

83,378.00

80,154.00

School District contributions subsequent to the

measurement date

1,227,615.37

-

Total

$ 3,934,857.37 $ 157,700.00

The School District contributions subsequent to the measurement date of $1,227,615.37 for TRS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2018. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

2018 2019 2020 2021 2022

$ 292,122.00 $ 292,121.00 $ 1,149,102.00 $ 784,376.00 $ 31,821.00

Actuarial assum ptions: The total pension liability as of June 30, 2016 was determined by an actuarial valuation as of June 30, 2015, using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers Retirement System:
Inflation Salary increases Investment rate of return

2.75%
3.25% 9.00%, average, including inflation
7.50%, net of pension plan investment expense, including inflation

- 23 -

CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Post-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service requirements and dependent beneficiaries. The RP-2000 Disabled Mortality table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2015 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.

Public School Employees Retirement System:

Inflation

2.75%

Salary increases

N/A

Investment rate of return

7.50%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2015 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.

The long-term expected rate of return on TRS and PSERS pension plan investments was determined

using a log-normal distribution analysis in which best-estimate ranges of expected future real rates

of return (expected returns, net of pension plan investment expense and inflation) are developed for

each major asset class. These ranges are combined to produce the long-term expected rate of return

by weighting the expected future real rates of return by the target asset allocation percentage and by

adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of

return for each major asset class are summarized in the following table:

Long-term

Target

expected real

Asset class

allocation

rate of return*

Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks

30.00% 39.70%
3.70% 1.60% 18.90% 6.10%

3.00% 6.50% 10.00% 13.00% 6.50% 11.00%

Total

100.00%

* Rates shown are net of the 3.00% assumed rate of inflation

- 24 -

CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017

EXHIBIT "H"

Discount rate: The discount rate used to measure the total TRS and PSERS pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the School District's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50%) or 1-percentage-point higher (8.50%) than the current rate:

Teachers Retirement System:
School District's proportionate share of the net pension liability

1% Decrease (6.50%)

Current Discount Rate (7.50%)

1% Increase (8.50%)

$ 24,408,776.00 $

15,681,711.00 $ 8,496,411.00

Pension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS and PSERS financial report which is publically available at www.trsga.com/publications and http://www.ers.ga.gov/formspubs/formspubs.html.
NOTE 14: SUBSEQUENT EVENTS
In the subsequent fiscal year, the School District issued $4,000,000.00 in general obligation bonds. The proceeds from these bonds will be used for acquiring or constructing capital facilities.

- 25 -

,-. / 012 323243005 60378

CHARLTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "1"

Year Ended
2017 2016 2015

School District's proportion of the
net pension liability

School District's proportionate share of the net pension liability

State of Georgia's proportionate share of the
net pension liability associated with the School
District

Total

School District's covered payroll

School District's proportionate share of the net pension
liability as a percentage of its covered payroll

Plan fiduciary net position as a
percentage of the total pension liability

0.076010% $ 0.075800% $ 0.075274% $

15,681,711.00 $ 11,539,797.00 $
9,509,877.00 $

234,782.00 $ 179,796.00 $ 150,593.00 $

15,916,493.00 $ 11,719,593.00 $
9,660,470.00 $

8,462,772.15 8,127,725.77 7,801,052.32

185.30% 141.98% 121.91%

76.06% 81.44% 84.03%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 27 -

CHARLTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOLS EMPLOYEES RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "2"

Year Ended
2017 2016 2015

School District's proportion of the
net pension liability

School District's proportionate share of the net pension liability

State of Georgia's proportionate share of the net
pension liability associated with the School District

0.00% $ 0.00% $ 0.00% $

-

$

-

$

-

$

227,089.00 $ 149,110.00 $ 134,790.00 $

Total

School District's covered payroll

School District's proportionate share of the net pension
liability as a percentage of its covered payroll

Plan fiduciary net position as a
percentage of the total pension
liability

227,089.00 $ 149,110.00 $ 134,790.00 $

485,370.19 470,818.27 471,330.65

N/A

81.00%

N/A

87.00%

N/A

88.29%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 28 -

CHARLTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "3"

Year Ended

Contractually required contribution

Contributions in relation to the contractually required
contribution

Contribution deficiency (excess)

2017

$

1,227,615.37 $

1,227,615.37 $

-

2016

$

1,189,821.00 $

1,189,821.00 $

-

2015

$

1,052,399.75 $

1,052,399.75 $

-

School District's covered payroll

Contribution as a percentage of covered
payroll

$ 8,729,941.99 $ 8,462,772.15 $ 8,127,725.77

14.06% 14.06% 12.95%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 29 -

CHARLTON COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2017

SCHEDULE "4"

Teachers Retirement System
Changes of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience.
On November 18, 2-015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP 2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males).
Public School Employees Retirement System
Changes of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more FORVHO\UHIOHFWDFWXDOH[SHULHQFH
On-December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP 2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females).

- 30 -

CHARLTON COUNTY BOARD OF EDUCATION GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2017

SCHEDULE "5"

REVENUES

Property Taxes

$

Sales Taxes

State Funds

Federal Funds

Charges for Services

Investment Earnings

Miscellaneous

Total Revenues

EXPENDITURES

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

Total Expenditures

Net Change in Fund Balances

Fund Balances - Beginning

Adjustments

NONAPPROPRIATED BUDGETS

ORIGINAL (1)

FINAL (1)

5,257,611.00 $ -
9,169,979.00 1,967,676.51
144,180.05 40,000.00 4,709.41
16,584,155.97

5,257,611.00 $ -
9,247,702.50 2,497,167.51
144,180.05 40,000.00 6,376.01
17,193,037.07

9,947,600.78
741,381.96 506,187.19 450,712.27 647,412.70 1,198,373.20 136,237.37 1,496,333.15 1,017,064.47
82,388.58 26,734.00 1,006,729.10
17,257,154.77
(672,998.80)
3,299,680.21
2,978.63

10,342,842.03
745,819.96 756,768.19 466,437.27 662,539.70 1,198,373.20 136,237.37 1,496,333.15 1,101,102.72
82,388.58 26,734.00 1,006,729.10
18,022,305.27
(829,268.20)
3,299,680.21
(1,245.05)

ACTUAL AMOUNTS

VARIANCE OVER/UNDER

5,273,670.75 $ 32,121.21
9,388,041.53 2,551,885.65
224,483.38 208.33
278,342.63
17,748,753.48

16,059.75 32,121.21 140,339.03 54,718.14 80,303.33 (39,791.67) 271,966.62
555,716.41

10,241,956.08
703,790.03 756,198.39 415,232.95 676,808.55 1,028,552.45 125,963.86 1,469,980.92 935,043.38
79,309.20 33,251.05 923,810.94
17,389,897.80
358,855.68
3,281,010.72
-

100,885.95
42,029.93 569.80
51,204.32 (14,268.85) 169,820.75 10,273.51 26,352.23 166,059.34
3,079.38 (6,517.05) 82,918.16
632,407.47
1,188,123.88
(18,669.49)
1,245.05

Fund Balances - Ending

$

2,629,660.04 $

2,469,166.96 $

3,639,866.40 $

1,170,699.44

Notes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual
(1) Original and Final Budget amounts do not include the budgeted revenues or expenditures of the various principal accounts. The actual revenues and expenditures of the various principal accounts are $285,215.50 and $284,548.50, respectively.
The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements.

See notes to the basic financial statements.

- 31 -

CHARLTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2017

SCHEDULE "6"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program
Total U. S. Department of Agriculture
Education, U. S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Preschool Grants
Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States Improving Teacher Quality State Grants Rural Education Striving Readers Title I Grants to Local Educational Agencies
Total Other Programs
Total U. S. Department of Education
Interior, U.S. Department of Pass-Through From Charlton County Commissioners Refuge Revenue Sharing Program

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

10.553 10.555

16165GA324N1099 $ 16165GA324N1099

203,543.03 670,699.71
874,242.74

84.027 84.173
84.048 84.367 84.358 84.371 84.010
15.227

H027A150073 H173A150081
V048A150010 S367A150001 S358B150010 S371C110049 S010A150010
F09AC00487

337,196.31 33,140.56
370,336.87
17,501.00 118,636.35
33,917.01 536,078.63 563,564.74 1,269,697.73 1,640,034.60
138,354.00

Total Expenditures of Federal Awards

$ 2,652,631.34

Notes to the Schedule of Expenditures of Federal Awards
Note 1. Basis of Presentation
The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of the Charlton County Board of Education (the "Board") under programs of the federal government for the year ended June 30, 2017. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net assets of the Board.
Note 2. Summary of Significant Accounting Policies
Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local, and Indian Tribal Governments , or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards , wherein certain types of expenditures are not allowable or are limited as to reimbursement. The Board has elected not to use the 10percent de minimis indirect cost rate as allowed under the Uniform Guidance.

See notes to the basic financial statements.

- 32 -

CHARLTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2017
AGENCY/FUNDING
GRANTS Bright From the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program
Education, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Amended Formula Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Sparsity Education Equalization Funding Grant Other State Programs Food Services Math and Science Supplements Preschool Handicapped Program Pupil Transportation - State Bonds Teachers Retirement Vocational Education Vocational Supervisors Georgia Foundation - Teacher of the Year
Office of the State Treasurer Public School Employees Retirement
CONTRACT Human Resources, Georgia Department of Family Connection
See notes to the basic financial statements.

SCHEDULE "7"
GOVERNMENTAL FUND TYPE GENERAL FUND
$ 420,690.30
496,526.00 195,139.00 1,119,161.00 554,483.00 484,938.00 264,675.00 904,137.00 852,692.00 241,593.00 1,047,321.00 156,808.00 190,718.00
69,451.00 26,385.00 180,303.00 55,815.00 30,192.00
1,026.00
353,737.00 472,949.00 406,995.00 (121,415.00)
262,226.00 45,000.00
198,791.00 202,144.00
22,834.00 16,624.34 29,646.00 77,216.25 18,147.39 24,902.00
6,653.00 507.25
32,031.00
47,000.00
$ 9,388,041.53
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CHARLTON COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2017

SCHEDULE "8"

PROJECT

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED IN PRIOR YEARS (3)

TOTAL COMPLETION
COST

EXCESS PROCEEDS NOT
EXPENDED

2012 SPLOST Projects

(1)

To pay the cost for retiring the School District's School Bonds,

dated March 19, 2008 (the"Series 2008 Bonds") by paying or

making provision for the payment of the principal of and interest on

the Series 2008 Bonds coming due on October 1, 2013 through

April 1, 2018, in the amount of $5,961,534.00.

$ 5,961,534.00 $ 5,961,534.00 $ 1,204,136.00 $ 3,537,085.00 $

- $

-

(2)

To pay the cost for acquiring instructional and administrative

technology improvements for existing schools, school buses,

maintenance vehicles and equipment, safety and security

equipment, and athletic, vocational, and fine arts equipment,

adding to, renovating, repairing, improving, and equipping existing

school buildings and other buildings and facilities useful or

desirable in connection therewith and physical education and

athletic facilities, and acquiring any necessary property therefor,

both real and personal, for the School District.

1,538,466.00

1,538,466.00

64,322.29

436,961.05

-

-

ESTIMATED COMPLETION
DATE
4/1/2018
6/30/2018

$ 7,500,000.00 $ 7,500,000.00 $ 1,268,458.29 $ 3,974,046.05 $

- $

-

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

See notes to the basic financial statements.

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