Audit report, Chattahoochee County Board of Education, Cusseta, Georgia, year ended June 30, 1998

AUDIT REPORT CHATTAHOOCHEE COUN1Y BOARD OF EDUCATION
CUSSETA, GEORGIA YEAR ENDED JUNE 30, 1998

CHATIAHOOCHEE CQUNIY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

6

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

7

ADDmONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBlNlNG BALANCE SHEET

18

F

COMBlNlNG STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

20

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

22

H

COMBINING STATEMENT OF REVENUES, EXPENDlTURES

AND CHANGES IN FUND BALANCES

24

I

FIDUCIARY FUND TYPE

COMBlNlNG STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUNDS

26

SCHEDULES

1 SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

28

2 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

29

3 SCHEDULE OF STATE REVENUE

31

4 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

32

CHATIAHOOCHEE COUNTY BOARD OF EDUCATION
- TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDmONAL FINANCIAL INFORMATION

SCHEDULES

5 SCHEDULE OF EXPENDITURES

LOITERY PROGRAMS

33

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

6

OVERALL

35

7

BY PROGRAM

36

SECTIONll
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133

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

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

SECTION I FINANCIAL
...

RUSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W. Suite 214 Atlanta, Georgia 30334-8400
July 23, 1999

Honorable Roy E. Barnes, Governor Members of the General Assembly Members ofthe State Board of Education
and Superintendent and Members of the Chattahoochee County Board ofEducation

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

Ladies and Gentlemen:

We have audited the accompanying general purpose financial statements ofthe Chattahoochee County Board of Education, as of and for the year ended June 30, 1998, as listed in the table of contents. These general purpose financial statements are the responsibility of the Chattahoochee County Board of Education's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in GOYernment Auditin& Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perfonn the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also mcludes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

As described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in soine respects from generally accepted accounting principles. These variances are described as follows:

* The general purpose financial statements of the Board did not contain a General Fixed Assets

Account Group to account for property and equipment owned by the Board which should be

included to confonn to generally accepted accounting principles.

.

98ARL-13B

* The Board did not recognize as expenditures, in the year ended June 30, 1998, a portion of salaries
and the corresponding employer's cost ofrelated benefits earned for contractual services completed prior to June 30, 1998. Also funds received, subsequent to June 30, 1998, from the Georgia Department ofEducation for the State's share ofthese unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1997, were improperly recorded in the year ended June 30, 1998. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements referred to above present fairly, in all material respects, the financial position ofthe Chattahoochee County Board ofEducation as ofJune 30, 1998, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Government Auditin~ Standards, we have also issued our report dated July 23, 1999, on our consideration ofthe Chattahoochee County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants.
The year 2000 supplementary information on Schedule "1" is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally ofinquiries ofmanagement regarding the methods ofmeasurement and presentation ofthe supplementary information. However we did not audit the information and do not express an opinion on it. In addition, we do not provide assurance that Chattahoochee County Board ofEducation is or will become year 2000 compliant, that the Board's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Chattahoochee County Board ofEducation does business are or will become year 2000 compliant.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements ofthe Chattahoochee County Board ofEducation taken as a whole. The accompanying combining statements (Exhibits E through 1) and the financial schedules (Schedules 2 through 7), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations, are presented for p~oses ofadditional analysis and are not a required part ofthe general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole.
98ARL-13B

A copy of this report has been filed as a pennanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.
Respectfully submitted,
~w.~~ Russell W. Hinton State Auditor
RWH:gp 98ARL-13B

CHATtAHOOCHEE COUNTY BOARD OF EDUCATION

CHATTAHOOCHEE COUNTY BOARD OF EPUCATION COMBINEP BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 1998

ASSETS
Cash and Cash Equivalents
Investments .~
Accounts Receivable
Inventories Food Donated Commodities Purchased Food
Amount Available in Debt Service Fund
Amount to be Provided in Future Years For Payment of Bond Debt

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 1,128,294.63 $

103,496;64 $

458,821.32

616,894.11

21,793.00

52,634.62

37,976.55

1,219.17 1,201.43

Total Assets

$ 1,150,087.63 $

158,551.86 $ 1,113,691.98

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payable Funds Held for Others General Obligation Bonds Payable
Total Uabilities
FUND EQUITY
Fund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Debt Service For Expired Grant Balances/Questioned COsts For Inventories Food Donated Commodities Purchased Food For Purpose of Bond Issue For SPLOST Projects For State Capital OuUay Projects Unreserved Deficit Undeslgnated
Total Fund EqUity

$

43,902.52 $

14,524.56

59,143.96

12,434.76

$

1,804.11

$

43,902.52 $

86,103.28 $

1,804.11

$

28,094.00

$
1,078,091.11 $ 1,106,185.11 $

1,219.17 1,201.43
$
70,027.98 72,448.58 $

992,687,40 31,593.66 87,n8.30
-171.49 0.00
1,111,887.87

Total Liabilities and Fund EqUity

$ 1,150,087.63 $

The notes to the general purpose financial statements are an integral part of this statemenl

-2-

158,551.86 $ 1,113,691.98

DEBT SERVICE
FUND

FIDUCIARY FUND TYPES AGENCY FUNDS

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS (Memorandum Only) JUNE 30,1998 JUNE 30,1997

$

75,386.14 $

3,329.81

$ 1,769,328.54 $ 1,083,342.72

616,894.11

112,404.17

53,389.71

1,219.17 1,201.43

$

75,386.14

75,386.14

924,613.86

924,613.86

1,674.11 717.75

$

75,386.14 $

3,329.81 $

1,000,000.00 $ 3,501,047.42 $ 1,139,124.29

$

58,427.08 $

25,012.74

59,143.96

42,016.29

12,434.76

5,883.89

1,804.11

5,194.00

$

3,329.81

3,329.81

9,476.71

$

1,000,000.00

1,000,000.00

$

3,329.81 $

1,000,000.00 $ 1,135,139.72 $

87,583.63

$

75,386.14

0.00 $

$

75,386.14 $

$

75,386.14 $

$

28,094.00

$

75,386.14

38.44 268.47

1,219.17 1,201.43 992,687.40 31,593.66 87,n8.30

1,674.11 717.75
69,090.21

-171.49

0.00

1,148,119.09

979,751.68

0.00

$ 2,365,907.70 $ 1,051,540,66

3,329.81 $

1,000,000.00 $ 3,501,047.42 $ 1,139,124.29

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CHATIAHOOCHEE COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BAlANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1998

REVENUES
State Funds Federal Funds Taxes Other Funds
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 Other Support Services Food Services Operation Community Services Operations
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Accrued Interest on Bonds Sold Proceeds from General Obligation Bonds
Par Value Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

$ 2,206,321,16 $ 17,909,72
340,886.18 245,004.45
$ 2,810,121.51 $

279,290,70 515,024.13
13,405.81
807,720.64

$ 1,515,407.55 $

112,780.89 121,385.67 58,672.81 117,464.44 168,565.48 73,932.86 177,698.18 106,684.08 10,081.50

177.34 2,331.00

$ 2,465,181.80 $

$

344,939.71 $

499,507.73
24,937.84 3,906.63
48,606.53 9,416.60
30.00 8,076.66 34,705.43 193,307.99
822,495.41
-14,774.77

$

$

-105,553.06

$

-105,553.06 $

$

239,386.65 $

866,798.46

5,711.06
5,711.06
-9,063.71 81,483.55
-454.94 483.68

FUND BALANCE JUNE 30

$ 1,106,185.11 $

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

7;,,;2 ,44-.-8.,5.8.
ii1o

EXHIBIT"B"

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS (Memorandum Only)
YEAR ENDED JUNE 30, 1998 JUNE 30, 1997

$

6,382.89

$ 2,491,994.75 $ 2,119,683.52

532,933.85

521,444.43

31,593.66 $

72,265.45

444,745.29

359,514.49

28,000.36

286,410.62

174,702.08

$

65,976.91 $

72,265.45 $ 3,756,084.51 $ 3,175,344.52

$

33,858.16 $

123,331.53

$

157,189.69 $

$

-91,212.78 $

$
4.31
4.31 $ 72,261.14 $

2,014,915.28 $
137,718.73 125,292.30 58,672.81 166,070.97 177,982.08 107,795.33 177,728.18 114,760.74 44,786.93 193,307.99
177.34 125,662.53
3,444,871.21 $
311,213.30 $

1,854,520.82
92,583.44 61,299.26 59,290.36 143,643.07 105,069.12 59,202.31 137,772.96 155,816.11 49,005.86 177,536.39
1,290.64 62,198.74
2,959,229.08
216,115.44

$ $ 1,000,000.00
99,842.00
$ 1,099,842.00 $
$ 1,008,629.22 $ 103,258.65

3,125.00 $ 3,125.00 $

3,125.00
1,000,000.00 105,553.06 $ -105,553.06
1,003,125.00 $

166,801.43 -166,801.43
0.00

75,386.14 $ 0.00

1,314,338.30 $ 1,051,540.66

216,115.44 836,754.66

-454.94 483.68

-882.57 -446.87

$ 1,111,887.87 $

75;0&1,3.8.,.6,;,,:.1_.4 $ 2,365,907.70 $ 1,051,540.'66 -5-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BAlANCES
BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 1998

EXHIBIT .C"

REVENUES

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES

$ 2,060,959,00 $ 2,206,321,16

17,909,72

344,974.00

340,886.18

245,004.45

$ 2,405,933.00 $ 2,810,121.51

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Piant Student Transportation Services central Support Services Other Support Services Food Services Operation Community Services Operations
Capital Outlay
Total expenditures
Excess of Revenues over (under) expenditures
OTHER FINANCING SOURCES (USES)

$ 1,652,238.59 $ 1,515,407.55

129,320.85 23,828.00 68.235.24 112.536.88 167,172.06 61,208.64 158,499.40 104,632.11 15.737.00

112.780.89 121,385.67 58,672.81 117,464,44 168,565.48 73,932.86 177,698,18 106,684.08
10,081.50

3,108.00

177.34 2,331.00

$ 2.496,516,77 $ 2,465.181.80

$

-90.583.77 $

344,939.71

Other Sources Other Uses
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $
FUND BAlANCE JULY 1,1997
Adjustments Food Inventories - Net Change in Period
Donated Commodities Purchased Food

$ -105,553,06 $ -105.553.06

-90,583.77 $ 860.545.86

239,386.65 866,798.46

FUND BALANCE JUNE 30,1998

$ 769.962.09 $ 1,106,185.11

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 203,038.00 $ 279,290.70

363,554.00

515,024.13

20.00

13,405.81

$ 566,612,00 $ 807,720,64

$ 390,597.08 $ 499.507.73

24,703.00 3.200.00

24,937.84 3,906.63

18,1n.00

48,606.53 9,416.60

30.00 8.076.66

55,360.00 33,000.00

34,705.43 193.307.99

$ 525,037.08 $ 822,495.41

$

41.574.92 $

-14,774.77

$

5,711.06

$

5,711.06

$

41.574.92 $

-9.063.71

82,123.26

81,483.55

3,468.09

-454.94 483.68

$ 127,166.27 $

72...4..4..8.;.;;;.5.8.

The notes to the general purpose financial statements are an integral part of this statement -6-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOIES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

ruNE 30. 1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Chattahoochee County Board of Education (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the Board is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The Board uses funds and an account group 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. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time ofpurchase. A General Fixed Assets Account Group is not presently maintained by the Board. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control ofthe Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most ofa Board's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.

-7-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
DEBT SERVICE FUND - the fund used to account for the accumulation of resources for, and the payment of, generallong-tenn principal, interest and paying agent fees.
FIDUCIARY FUND TYPE - the fund used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. This fund includes:
AGENCY FUNDS - the funds used to account for assets held in a fiduciary capacity for other funds or individuals.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding.
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is detennined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Tenn Debt Account Group.
Agency funds are purely custodial in nature and do not involve measurement of results of operations.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be detennined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Those revenues considered susceptible to accrual are property taxes, local option sales taxes, intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.

-8-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 1998, a substantial number of personnel ofthe Board were employed for a one hundred and ninety day period beginning in late August 1997 and ending in earlr June 1998. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1997 and ending in August 1998. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As of June 30, 1998, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1998, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1998. Also, the State's portion of the compensation paid in July and August 1998 was received and recorded as revenue in the fiscal year subsequent to June 30, 1998. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1997, were recorded in the year ended June 30, 1998. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities.
BUDGET
The Chattahoochee County Board of Education's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level ofbudget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circlliation in the locality. At the next regular meeting ofthe Bom-d after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department ofEducation. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.

-9-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30.1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations.
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the Board in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation of the United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
(8) Obligations of other political subdivisions of the State of Georgia.
RECEIVABLES
Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from infonnation available. Receivables are recorded when
-10 -

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHffiIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POUCIES

either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.

PROPERTY TAXES

The Chattahoochee County Board of Commissioners fixed the property tax levy for the 1997 tax year (calendar year) on November 20, 1997 (levy date). Taxes were due on February 20, 1998. The lien date for property taxes was January 1, 1997. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1998. The Chattahoochee County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the Board.

The tax millage rate levied for the 1997 tax year (calendar year) for the Chattahoochee County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

10.70 mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $103,859.11 and was recorded in the Capital Projects and Debt Service Funds. The State will terminate collection of this tax once an additional $1,396,140.89 has been collected or on December 31,2002, whichever occurs first.

INVENTORIES

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

GENERAL OBLIGATION BONDS

The Board issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial

- 11 -

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

statements during the year bonds are issued. General obligation bonds are direct obligations and pledge the full faith and credit of the government. The outstanding amount of these bonds is recorded in the General Long-Tenn Debt Account Group.

INTERFUND TRANSACTIONS

The Board has the following types of interfund transactions:

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

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

MEMORANDUM ONLY - TOTAL COLUMNS

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

DEFICIT FUND BALANCES

The fund reporting a deficit fund balance position at June 30, 1998, is as follows:

Fund I?elFund Name

Deficit Balance

Governmental Fund Type Capital Projects Fund - Regular

$===-====,=17~1==.4!*:2

The Board intends to fund this deficit with a transfer of funds from the General Fund.

Note 2: DEPOSITS

COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value ofsecurities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction of the amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.

- 12-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 2: DEPOSITS
Acceptable security for deposits consists of anyone of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Cotporation,
(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 ofthe State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this pUtpose,
(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 cOtporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
CATEGORIZATION OF DEPOSITS At June 30, 1998, the bank balances were $2,565,022.47. The amounts of the total bank balances are classified into three categories of credit risk:
Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name.
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Board's name.)
The Board's deposits are classified by risk category at June 30, 1998, as follows:

- 13-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

ruNE 30.1998

Note 2: DEPOSITS

Risk Cate~01Y

Bank Balance

1

$ 172,261.14

2

2,392,761.33

3

0.00

Total

$ 2,565.022.47

Note 3: NON-MONETARY TRANSACTIONS

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

Note 4: RISK MANAGEMENT

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

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

The Board has elected to self-insure for all losses related to natural disaster. The Board has not experienced any losses related to this risk in the past three years.

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

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

1997 1998

Beginning of Year liabilitY

Claims and Changes in Estimates

$

0.00 $

0,00 $

$

0,00 $

224.00 $

Claims Paid

End ofYear Liability

0,00 $

0.00

224,00 $

0.00

- 14-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 4: RISK MANAGEMENT

The Board participates in the Georgia Education Workers' Compensation Trust, a public entity risk pool organized on December 1, 1991 to develop, implement and administer a program of workers' compensation self-insurance for its member organizations. The Board pays an annual premium to the Trust for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Trust with the United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Trust in excess of $250,000.00 loss per occurrence, up to $2,000,000.00.

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

Position Covered

Amount

Superintendent Principal Maintenance Supervisor Each Bookkeeper School Secretary School Clerk

$ 20,000.00
$ 10,000.00 $ 10~000.00 $ 10,000.00
$ 10,000.00
$ 10,000.00

Note 5: GENERAL LONG-TERM DEBT

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

PUIPose

Interest Rates

Amount

General Government - Series 1997

4.5%

$J ,000.000.00

The changes in General Long-Term Debt during the fiscal year ended June 30, 1998, were as follows:

General Obligation
Bonds

Balance July 1, 1997

$

0.00

Additions

1,000,000.00

Balance June 30, 1998

$ 1.000.000.00

- 15 -

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1998

Note 5: GENERAL LONG-TERM DEBT

At June 30, 1998, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30

General Obligation
Bonds

1999 2000 2001 2002 2003

$ 250,825,00 222,625,00 223,850,00 224,625,00 224,950,00

Total Principal and Interest

$l..146.875,00

Note 6: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of$43,427.40 for health insurance and retirement contributions paid on the Board's behalfby the following State Agencies,

Georgia Department ofEducation Paid to the State Merit System ofPersonnel Administration For Health Insurance ofNon-Certified Personnel In the amount of $29,545,96

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$4,188,44

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of$9,693,00
Note 7: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the

Board as of June 30, 1998, together with funding available:

.

- 16-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 7: SIGNIFICANT COMMITMENTS

Project

Unearned Executed Contracts

Funding Available From State

GSFIC 99/98S-626-003

$ 1.931.605.89 $ 853.701.00

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

Note 8: CONTINGENT LIABILITIES

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

Note 9: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

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

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

Fiscal Year

Percentage Contributed

Required Contribution

1998 1997 1996

100% 100% 100%

$ 227,726.06 $ 205,552.53 $ 196,711.09

- 17 -

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

ASSETS
Cash and Cash Equivalents
Accounts Receivable
Inventories Food Donated Commodities Purchased Food
Total Assets
LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity
Total Liabilities and Fund Equity

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

74,622.04 $

23,214,91

4,379.58

1,219.17 1,201,43

$

81,422.22 $

23.,2. .1.4...9..1.

$

828.80 $

4,649,69

8,144.84

18,565.22

$

8,973.64 $

23,214.91

$

1,219.17

1,201.43

70,027.98 $

0.00

$

72,448,58 $

0.00

$

81,422.22 $ _ _2..,.3,.2;,,;1,.;,4';,;,9.1.

See notes to the general purpose financial statements.

-18 -

EXHIBIT"E"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS
JUNE 30,1998 JUNE 30,1997

$

5,659.69 $

0.00 $

103,496.64 $

89,219.06

48,255.04

52,634.62

46,747.70

1,219.17 1,201.43

1,674.11 717.75

$

53,914.73 $

0.00 $ 158,551.86 $ 138,358.62

$

9,046.07

32,433.90

12,434.76

$ _ _5;;.;:3;,z.;,9:;..;1....:.;4.;.;..73~

$

14,524.56 $

8,974.89

59,143.96

42,016.29

12,434.76

5,883.89

$

86,103.28 $ _---..;5:;,;:;6:.;;;,8.;.,;;75;.;.;.0;.;...7

$

0.00 $

$

0.00 $

$

53,914.73 $

$
0.00 0.00 $

$
1,219.17 1,201.43 70,027.98 72,448.58 $

38.44 268.47
1,674.11 717.75
78,784.78 81,483.55

0.00 $

158,551.86 $

138,358.62

-19 -

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 1998

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Operating Transfers In
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

14,594,00 $ 226,658,70

156,551.38

13,405.81

$

184,551,19 $

226,658,70

$

195,111.25

$

193,307,99

25,447.26 9,416.60 30.00 89,89 18.23

$

193,307.99 $

230,113.23

$

-8,756.80 $

-3,454.53

$

-8,756.80 $

81,176.64

-454.94 483.68

3,454.53
0.00 0.00

$

72,448,58 $

....;,0o;;.O~O

See notes to the general purpose financial statements.

20 -

EXHIBIT "F"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS YEAR ENDED JUNE 30, 1998 JUNE 30, 1997

$

$

358,472.75

$

358,472.75 $

38,038.00 $ 38,038.00 $

279,290.70 $ 515,024.13
13,405.81
807,720.64 $

98,683.00 521,089.43
30,961.24
650,733.67

$

288,259.39 $

796.00 3,906.63

23,159.27

7,986.77 34,687.20

$

358,795.26 $

$

-322.51 $

16,137.09 $ 24,141.84
40,278.93 $ -2,240.93 $

499,507.73 $
24,937.84 3,906.63
48,606.53 9,416.60 30.00 8,076.66 34,705.43
193,307.99
822,495.41 $
-14,774.77 $

345,725.02
20,881.00 27,934.29
3,928.55 35,381.77
384.52 8,356.36 27,724.86 177,536.39
647,852.76
2,880.91

15.60

2,240.93

5,711.06

12,612.17

$

-306.91 $

306.91

0.00 $ 0.00

-9,063.71 $ 81,483.55

15,493.08 67,319.91

-454.94 483.68

-882.57 -446.87

$

0.00 $

0.00 $

72,448.58 $

81,;,:,,4.;,;8;,;3~.5;,;,,5

- 21 -

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

ASSETS Cash and Cash Equivalents Investments Accounts Receivable
Total Assets
LIABILITIES AND FUND EQUITY LIABILITIES
Cash Overdraft Contracts Payable Retainages Payable
Total Liabilities FUND EQUITY
Fund Balances Reserved For Purposes of Bond Issue For SPLOST Projects For State Capital Outlay Projects Unreserved Deficit Undesignated Total Fund Equity
Total Liabilities and Fund Equity

REGULAR

BOND PROCEEDS

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

0.00 $

375,793.29 $

70,652.52

616,894.11

6,382.89

$

0.00 $

992,687.40 $ _ .....-:..77:..,O~3~5~.4;.:..1

$

171.49

$

171.49

$

1,804.11

$

1,804.11

$

992,687.40

$

75,231.30

$

-171.49

0.00

0.00

0.00

$

-171.49 $

992,687.40 $

75,231.30

$

0.00 $

992,687.40 $ _ _.....;,;77:.r.:,0~3~5,;;;:;.4~1

See notes to the general purpose financial statements.

- 22-

EXHIBIT"G"

SPECIAL PURPOSE LOCAL OPTION SALES TAX
$

$

31,593.66

LOTIERY PROJECT

TOTALS

JUNE 30, 1998

JUNE 30,1997

12,547.00 $

458,992.81 $

108.452.65

616,894.11

37,976.55

$

31.593.66 $

12,547.00 $ 1.113,863.47 $ ......_ _1.0.8.,.4=5=2.;.;;;6=5

$

171.49

1,804.11

_____ $

5.194.00

$

1.975.60 $ _ _--=o5.L.:,;19:..:4~.0~0

$

992,687.40

$

31,593.66

31,593.66

$

12,547.00

87,778.30 $

69,090.21

-171.49

0.00

0.00

0.00

34,168.44

$

31,593.66 $

12,547.00 $ 1,111,887.87 $

103,258.65

$

31,593.66 $

12,547.00 $ 1,113,863.47 $ .............1..0.8...4=5=2.;.;;;65=

- 23-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30.1998

FUND BALANCE JUNE 30

$

-171.49 $

992,687.40 $ _ _....7...5,._23;.:1,,;;.3~0

See notes to the general purpose financial statements.

24 -

EXHIBIT"H"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

LOTTERY PROJECT

TOTALS

YEAR ENDED

JUNE 30,1998

JUNE 30,1997

$

$

31,593.66

$

31,593.66 $

0.00 $ 0.00 $

6,382.89 31,593.66 28,000.36 $
65,976.91 $

.=32==3:.:.:.8~1 .=32==3:.:.:.8~1

$

0.00 $

$

0.00 $

$

31,593.66 $

$ --=0;.:.;:.0;.:..0
0.00 $ 0.00 $

33,858.16 123,331.53 $ _ _....::5:.::2!t=.87:...;4:.:.:..7~4 157,189.69 $ _ _....::5:.::2,t=.87:...;4:.:.:..7~4 -91,212.78 $ _ _...;:-5=2,=55::;.;:0;.:.;:.9;.:..3

$ 1,000,000.00

$

0.00 $

0.00

99,842.00 $

154.189.26

$

0.00 $

0.00 $ 1,099,842.00 $

154,189.26

$

31,593.66 $

0.00 $ 1,008,629.22 $

101,638.33

0.00

12,547.00

103,258.65

1,620.32

$

31,593.66 $

12,547.00 $

1,111,887.87 $ _~1_0iiiil3,;;;25_8_.6~5

- 25-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUNDS YEAR ENDED JUNE 30, 1998

EXHIBIT-I-

ART CLUB ASSETS
Cash and Cash Equivalents
LIABILITIES Funds Held for Others

BALANCE JULY 1,1997

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30,1998

$

160,50 $

214,25 $

94.48 $

280,27

$

160,50 $

214.25 $

94.48 $

-=28~O:o:,2~7

BUILDER'S CLUB
ASSETS Cash and Cash Equivalents

$

46,24 $

0,00 $

0,00 $

...;4~6:o:.2~4

LIABILITIES Funds Held for Others
CHESS CLUB ASSETS
Cash and Cash Equivalents
LIABILITIES Funds Held for Others
HOSPITALITY ASSETS
Cash and Cash Equivalents
LIABILITIES Funds Held for Others
NEWSPAPER ASSETS
Cash and Cash Equivalents
LIABILITIES Funds Held for Others

$

46.24 $

0,00 $

0,00 $

...;4~6:o:.2~4

$

94.02 $

727,60 $

852,37 $

.;:-3~0:.:.7~5

$

94.02 $

727,60 $

852.37 $

..;:-3~0:.:.7~5

$

74,21 $

273.00 $

293.39 $

...;5~3:;;;.8::;.2

$

74.21 $

273.00 $

293,39 $

5~3~.8::;,2

$

109.59 $

14.15 $

60.00 $

..:6~3:.:.7~4

$

109.59 $

14.1'5 $

60.00 $

..:6~3:.:.7~4

-26-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUNDS
YEAR ENDED JUNE 30, 1998

PLAYGROUND EQUIPMENT
ASSETS Cash and Cash Equivalents

BALANCE JULY 1,1997

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 1998

$

854.10 $

0.00 $

509,62 $

344,48

LIABILITIES Funds Held for Others

$

854.10 $

0,00 $

509.62 $

.:;:;;344~.4~8

STUDENT COUNCIL
ASSETS Cash and Cash Equivalents

$

5.43 $

0,00 $

0,00 $

~5;;;.4~3

LIABILITIES Funds Held for Others

$

5.43 $

0.00 $

0.00 $

~5:.;;;:.4~3

TECHNOLOGY CLUB
ASSETS Cash and Cash Equivalents

$

162.27 $

0.00 $

162.27 $

~O~.O~O

LIABILITIES Funds Held for Others

$

162.27 $

0.00 $

162.27 $

~O~.QO~

VENDING MACHINES
ASSETS Cash and Cash Equivalents

$

7,970.35 $

23.711 ,38 $

29,115.15 $ _ _~2,~566~.58::;:.

LIABILITIES Funds Held for Others

$

7,970.35 $

23,711.38 $

29,115,15 $ _ _...,;;,j2,~56:;;:6;;;;.58~

TOTALS-AGENCY FUNDS
ASSETS Cash and Cash Equivalents

$

9,476.71 $

24,940.38 $

31,087.28 $ _ _~30\;,3;;;2~9.;;;:;8.:.1

LIABILITIES Funds Held for Others
see notes to the general purpose financial statements.

$

9,476.71 $

-27 -

24,940.38 $

31,087.28 $ _ _~3'o:;::32:o:9;;;;.8:.:.1

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION SCHEDULE "1" SCHEDULE OF REQllIRED SuppLEMENTARY INFORMATION
YEAR 2000 DISCLOSURES
YEAR ENDED JUNE 30. 1998
At June 30, 1998, the Chattahoochee County Board of Education had no outstanding contractual commitments for the purpose of making computer systems and other electronic equipment year 2000 compliant. The year 2000 issue is the result of shortcomings in many electronic data processing systems and other equipment that make operations beyond year 1999 troublesome. The year 2000 issue is of primary concern for the Board's financial accounting system. The following stages have been identified as necessary to implement a year 2000 compliant systems.
Awareness Stage - Encompasses establishing a budget and project plan for dealing with the year 2000 Issue.
Assessment Stage - The actual process of identifying all of its systems and individual components of the systems to check for compliance.
Remediation Stage - When changes are made to systems and equipment.
Validationffesting Stage - The process of ensuring that the changes made to systems and equipment will produce a year 2000 compliant system. It will be necessary for the Board to progress through all four of these stages for each computer and/or electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversely affected. As ofJune 30, 1998, the financial accounting system was detennined to be at the Awareness Stage.
The Board's financial accounting software (GENESIS) and hardware (Wang VS) are owned by the State (Georgia Department ofEducation). These systems have been detennined to be critical to the Board's ability to successfully conduct operations. As ofJune 30, 1998, the State had not contracted for the remediation of either the Wang VS operating system or the GENESIS accounting software. In the subsequent period, the Georgia Department of Education remediated the Wang VS operating system and the updated operating system was installed at all GENESIS sites as ofDecember 9, 1998. The Georgia Department of Education has remediated the GENESIS software and conducted tests at nine pilot sites. The remediated GENESIS software has been provided to all boards ofeducation currently utilizing the GENESIS accounting software.
See notes to the general purpose financial statements. - 28-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 1998

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Agriculture, U. S. Department of Direct Food and Nutrition Program Summer Food Service Program for Children 1998 Grant Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1998 Grant National School Lunch Program 1998 Grant Food Distribution Program (1) Pass-Through From Office of School Readiness Food and Nutrition Program Summer Food Service Program for Children 1998 Grant

10.559
* 10.553 * 10.555
10.550
10.559

$

2,514.47 $

4,760.32 (3)

N/A

41,000.28

(2)

N/A

99,048.96

174,560.00 (3)

N/A

13,229.02

13,229.02

N/A

758.65

758.65

Total U. S. Department of Agriculture

$

156,551.38 $

193,307.99

Education, U. S. Department of Direct Impact Aid 1998 Grant Pass-Through From Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies 1998 Grant Goals 2000 State and Local Education Systemic Improvement Grants 1997 Grant Individuals with Disabilities Education Act Part B - Special Education Flow Through 1997 Grant 1998 Grant Preschool 1998 Grant

84.041
84.010
84.276
84.027 84.027 84.173

$

2,898.40

(4)

N/A

327,023.06 $

327,291.53 (3)

N/A

38.44

N/A

15.60 (3)

N/A

26,518.47

26,518.47

N/A

4,931.22

4,931.22

Total U. S. Department of Education

$

361,371.15 $

358,795.26

OTHER FEDERAL ASSISTANCE

Defense, U. S. Department of Direct Defense Activity for Non-Traditional Educational Support Troops to Teachers

$

15,011.32

(4)

Total Federal Financial Assistance
= N/A Not Available

-29-

$

532,933.85 $

5.-52iOl,,1_0.3,..2.5.

CHATIAHOOCHEE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 1998

SCHEDULE "2"

Notes to the Schedule of Expenditures of Federal Awards
(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the School Breakfast Program were not maintained separately and are induded in the 1998 National School Lunch Program.
(3) Expenditures for this program indude State, and/or Other Funds. Expenditures are not maintained by fund source.
(4) Expenditures on this program were not maintained by fund source.
Major Programs are identified by an asterisk (*) in front of the CFDA number.
The Board did not provide Federal Assistance to any SUbrecipient.
The accompanying schedule of expenditures of Federal awards indudes the Federal grant activity of the Chattahoochee County Board of Education and is presented on the modified accrual basis of accounting which Is the same basis of accounting used in the presentation of the financial statements for the governmental funds.

See notes to the general purpose financial statements.

-30-

CHATIAHOOCHEE COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1998

SCHEDULE -3-

AGENCYIFUNDING
GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Sparsity Grant Middle School Incentive Program Special Instructional Assistance In-School Suspension Counselors Grades 4 and 5 Technology Training Local Fair Share Educational Equalization Funding Grant Food Services Other State Programs Ad Valorem Tax Adjustment At-Risk Summer School Program Environmental Science Program Health Insurance Innovative Programs Mentor Teacher Program Preschool Handicapped Program Student Records Teachers'Retirement Lottery Programs Instructional Technology Assistlve Technology Classroom Technology
Community Affairs, Georgia Department of Local Assistance Grant
Georgia State Financing and Investment Commission Reimbursement on Construction Projects
Human Resources, Georgia Department of D.A. R. E,
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$

980,754,00

240,300.00

28,127.00

45,313.00

13,200.00

318,299.00

84,579.00 28,094.00 104,481.00 44,785.00 86,801.00 41,643.00
5,312.00 28,842.00 -138,792.00 140,522.00
$

14,350.00 4,257.79
500.00 29,545.96
5,000.00 1,128.00

745.50 4,188.44

63.250.00

14,594.00
38,038.00 3,790.00
53,000.00

$

980,754.00

240,300.00

28,127.00

45,313.00

13,200.00

318,299.00

84,579.00 28,094.00 104,481.00 44,785.00 86,801.00 41,643.00
5,312.00 28,842.00 -138,792.00 140,522.00 14,594.00

14,350.00 4,257.79
500.00 29,545.96
5,000.00 1,128.00 38,038.00
745.50 4,188.44

3,790.00 53,000.00

63.250.00

21,402.47 9,693.00

$

6,382.89

169,868.70

6,382.89 21,402.47 169,868.70
9,693.00

$ 2,206,321.16 $

279,290.70 $

6,382.89 $ 2,491,994.75

See notes to the general purpose financial statements,

- 31 -

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

SCHEDULE "4"

PROJECT

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED
COST (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED IN PRIOR
YEARS

Chattahoochee County Education CenterClassroom building additions, renovation to media center, cafeteria, re-roofing main building, covered walkway to existing playground and bus stop, additional parking facilities, heating and air conditioning, sanitation, and communications improvements, fumiture needs, relocation and correction of three mobile units, furniture needs for Chattahoochee County Education Center and other necessary costs associated with Board of Education Expansion Program $

1,500,000.00 $ 1,500,000.00 $

77,849.11 $

....0..,0.0..

(1) The Board's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax.
(2) The Board's current estimate of total cost for each project. Includes all cost from project inception to completion.
(3) The voters of Chattahoochee 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 project.

See notes to the general purpose financial statements.

-32-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES LOTTERY pROGRAMS YEAR ENDED JUNE 30. 1998

SCHEDULE -5-

EXPENDITURES
Current Instruction Support Services General Administration School Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services

INSTRUCTIONAL TECHNOLOGY

ASSISTIVE

CLASSROOM

TECHNOLOGY TECHNOLOGY

PRE-KINDERGARTEN PROGRAM

$

3,790.00 $

53,000.00 $

138,321.25 $
25,447.26 9,416.60 30.00 89.89 18.23

TOTAL
195,111.25
25,447.26 9,416.60 30.00 89.89 18.23

Total Expenditures

$

3,790.00 $

53,000.00 $

173,323.23 $

230,113.23

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

$

152,100.61

3,790.00 53,000.00 21,222.62

$

230,113.23

See notes to the general purpose financial statements.

- 33-

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

SCHEDULE "6"

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

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$

1,294,494.00 $ _ _--=2::::9:.z..:,1:,.:::8.:::.;8.:.:::,00::..

$

1,240,549.71

80,122.56 $ _ _---=-7.:.12,.:::.:82:.:.7.:..:.1:.=.,6

$

1,320,672.27

-10,580.29 $ _ _-:.1.l.:,3~01:;,z.,0::.:9:.:.1.:,:.9:.:.,8

$

0,00 $==......._ _~O~.O~O

See notes to the general purpose financial statements. - 35 -

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

GENERAL AND CAREER EDUCATION PROGRAMS Kindergarten (*) Grades 1 - 3 (*) Sub-Total - K-3 Grades 4 - 5 (*) Grades 6 - 8 (*) Total General and Career Education Programs
SPECIAL EDUCATION PROGRAMS Regular Programs Category I r) Sub-Total - Regular Category VI (Gifted) (*) Total Special Education Programs
REMEDIAL EDUCATION PROGRAM (*) Total Fourteen Weighted Programs
MEDIA CENTER PROGRAMS Salaries Operations Total Media center Programs

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

REQUIRED

ORIGINAL

%

ORIGINAL

MID-TERM

$

175,518.00

$

157,966.20 $

0.00

378,963.00

341,066.70

$

554,481.00 90 $

499,032.90 $

0,00

158,323.00 90

142,490.70

267,950.00 90

241,155.00

$

980,754.00

$

882,678.60 $

0.00

$

229,661.00

$

206,694.90 $.

0.00

$

229,661.00 90 $

206,694.90 $

0.00

10,639.00 90

9,575.10

$

240,300.00

$

216,270.00 $

0.00

$

28,127.00 90 $

25,314.30 $

0.00

$ 1,249,181.00

$ 1,124,262.90 $

0.00

$

37,840,00 90 $

34,056.00 $

0.00

7,473.00 90

6,725.70

$

45,313.00

$

40,781.70 $

0.00

Total Fourteen Weighted and Media center Programs $ 1,294,494.00

$ 1,165,044.60 $

0,..0,.0

STAFFDEVEUQPMENTPROGRAMS Cost of Instruction Professional Development
Total Staff Development Programs (*) Identifies Fourteen Weighted Programs,

$

3,826.00

9,374.00

$

3,826.00 $

9,374.00

$

13,200.00 100 $

.13,200.00 $

0.00 0.00
. . 0.0..0.

See notes to the general purpose financial statements.

- 36 -

SCHEDULE "T'

TOTAL REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

157,966.20 $

146,356.01 $

10,734.47 $

157,090.48

341,066.70

346,061.81

26,075.42

372,137.23

$

499,032.90 $

492,417.82 $

36,809.89 $

529,227.71 $

0.00

142,490.70

178,937.68

14,980.07

193,917.75

0.00

241,155.00

282,612.53

15,184.75

297,797.28

0.00

$

882,678.60 $

953,968.03 $

66,974.71 $ 1,020,942.74

$

206,694.90

$

$

206,694.90 $

9,575.10

$

216,270.00 $

$

25,314.30 $

$ 1,124,262.90 $

199,989.71 $ 199,989.71 $
9,903.98 209,893.69 $
28,090.10 $ 1,191,951.82 $

5,078.90 $ 5,078.90 $
773.55 5,852.45 $
0.00 $ 72,827.16 $

205,068.61 205,068.61
10,677.53 215,746.14
28,090.10 1,264,778.98

1,626.29 0.00
0.00

$

34,056.00 $

48,597.89

$

48,597.89

0.00

6,725.70

$

7:,.::,2:.:9:.::.5:. :,.4=.,0

7,295.40

0.00

$

40,781.70 $

48,597.89 $

7,295.40 $ _ _.:;55::J,,8:.:9:.::.3::.2=.,9

$ 1,165,044.60 $ 1,240,549.71 $

80,122.56 S 1,320,672.27 $ -========1..,6.2.62.=9

$

3,826.00

9,374.00

$ ===13=,=20=0=.0",=0

$

13,920.43 $

13,920.43

7,700.00

7,700.00

$

21,620.43 $

21,620.43 $=.=====,00.=0

37

SECTIONll COMPLIANCE AND INTERNAL CONTROL REPORTS

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
July 23, 1999

Honorable Roy E. Barnes, Governor Members of the General Assembly Members ofthe State Board of Education
and Superintendent and Members ofthe Chattahoochee County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
GO\'ERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements of Chattahoochee County Board of Education as of and for the year ended June 30, 1998, and have issued our report thereon dated July 23, 1999. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government AuditinG Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether Chattahoochee County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit and accordingly, we do not express such an opinion. The results of our tests disclosed an instance of noncompliance that is required to be reported under Government AuditinG Standards which is described in the accompanying Schedule of Findings and Questioned Costs as item FS-6261-98-03.
Internal Control OVer Financial &PortinG
In planning and performing our audit, we considered Chattahoochee County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing
. our opinion on the financial statements and not to provide assurance on the internal control over financial
98YB-60

reporting. However, we noted certain matters involving the internal control over financial reporting and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgement, could adversely affect Chattahoochee County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. Reportable conditions are described in the accompanying Schedule of Findings and Questioned Costs as items FS-6261-98-02 and FS-6261-98-04.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, of the reportable conditions noted above, we consider item FS-6261-98-04 to be a material weakness.
This report is intended solely for the information and use of management, members of the Chattahoochee County Board of Education, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
<"'44' /J2.. W.4~ Russell W. Hinton State Auditor
RWH:gp 98YB-60

RUSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w.. Suite 214 Atlanta, Georgia 30334-8400
July 23, 1999

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Chattahoochee County Board ofEducation
REPORT ON COMPLIANCE WITH REQIDREMENTS APPUCABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL Q\TERCQMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-I 33
Ladies and Gentlemen:
Compliance
We have audited the compliance of Chattahoochee County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1998. Chattahoochee County Board of Education's major Federal programs are identified in the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Chattahoochee County Board of Education's management. Our responsibility is to express an opinion on Chattahoochee County Board of Education's compliance based on our audit.
We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditin~ Standards, issued by the Comptroller General ofthe United States; and OMB Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Chattahoochee County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal detennination on Chattahoochee County Board ofEducation's compliance with those requirements.

98SA-IO

In our opinion, the Chattahoochee County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30, 1998.
Internal Control Over Compliance
The management of Chattahoochee County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Chattahoochee County Board of Education's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133.
Our consideration ofthe internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level ofrisk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended solely for the information and use of management, members of the Chattahoochee County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
~~ QQ ~.~ Russell W. Hinton State Auditor
RWH:gp 98SA-I0

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

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION
AUDITEE'S RESPONSE
SUMMARy SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30. 1998

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

6261-93-02 6261-93-03 FS-6261-97-01 FS-6261-97-02

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

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6261-97-02

The Board does not maintain a fixed asset account and at this time no plans have been made to establish one.

SECTION IV FINDINGS AND QUESTIONED COSTS

CHATTAHOOCHEE COUNTy BOARD OF EDUCATION
SCHEDULE OF FlNDINGS AND QUESTIONED COSTS YEAR ENDED ruNE 30. 1998

I SUMMARY OF AUDITOR'S RESULTS

1. T)!pe of Re.port Issued on the Financial Statements The auditor's opinion on the Chattahoochee County Board of Education's fmancial statements was qualified for various departures from generally accepted accounting principles.

2. Re.portable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Chattahoochee County Board of Education disclosed financial statement reportable conditions related to the following control categories.

General Ledger

General Fixed Assets

Of the reportable conditions described above, General Fixed Assets is considered to be a material weakness.

3. Noncompliance Material to the Financial Statements The audit ofthe Chattahoochee County Board ofEducation disclosed one instance ofnoncompliance deemed material to the financial statements. This noncompliance involved the Board's failure to transfer required funds from the General Fund to the Capital Projects Fund.

4. Re.portable Conditions in Internal Control Over Major Pro~s The audit report for the Chattahoochee County Board of Education did not disclose any reportable conditions in internal control over major programs.

5. T)!pe ofRe.port Issued on Compliance for Mqjor Pro~s The auditor's opinion on the Chattahoochee County Board of Education's report on compliance with requirements applicable to major programs was unqualified.

6. Audit Findings Reqyired to be Re.ported by Section .510(3) ofOMB Circular A-133 The Chattahoochee County Board ofEducation's audit did not disclose audit findings required to be reported by section .51O(a) ofOMB Circular A-133.

7. MqjorProgtams Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program

8. T}!pe "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.

9. Low Risk Auditee The Chattahoochee County Board ofEducation was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education.

- 1-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION
SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 3D. 1998
IT FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
EXPENDITURESILIABILITIESIDISBURSEMENTS Failure to Meet Expenditure Requirements Nonmaterial Noncompliance Amount: $1,626.29 Finding Control Number: FS-6261-98-01
The Chattahoochee County Board ofEducation reported to the Georgia Department ofEducation on DE fonn 0420 an underexpenditure of Quality Basic Education (QBE) funds of $1 ,626.29 for the Special EducationRegular Program. This underexpenditure occurred because the Board expended less than the minimum expenditure requirement for this QBE Program. The underexpenditure of $1 ,626.29 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair"share for the QBE program in a subsequent fiscal period.
Management's Response:
Failure to Meet Expenditure Requirements. Underexpenditure was a result of losing an aide during middle ofyear and it took several weeks to find a replacement. We keep a close observation on the DE 0420 monthly and try to spend all ofthese funds according to allotments. This will be watched very carefully.
GENERAL LEDGER Inadequate Accounting Procedures Reportable Condition Finding Control Number: FS-6261-98-02
A review oftenjourna1 entries selected for testing revealed that journal entries were made without supervisory review and approval prior to input into the accounting system. This condition was the result ofmanagement's failure to adequately monitor the journal entry process. The Board should implement procedures to ensure that journal entries are reviewed and approved prior to entry into the accounting system.
Management's Response:
Even though we are a small system journal entries are required almost every day. Moving funds from GF bank to SF&N bank, USDA inventories, even ifyou make an error in posting expenditures to wrong program codes this has to be corrected with a journal entry. This is nonnally discussed with Mr. Burgamy and he approves but to interrupt him several times daily to make him aware ofthese small entries is not feasible. We make copies of the IE's, keep them in a binder, he looks at these monthly. He reviews General Ledger and DE 420 monthly and at the board meeting all expenditures are viewed, approved and signed. We will get his signature on all IE issued this year.
-2-

CHATTAHOOCHEE COUNTY BOARD OF EDUCATION
SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEARENPED JUNE 30.1998
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL LEDGER Failure to Transfer Local Matching Funds Material Noncompliance Finding Control Number: FS-6261-98-03
The Board received approval for State Capital Outlay Project funding, through Georgia State Financing and Investment Commission, for the 1998 fiscal year. Both the instructions in Section 5 Chapter 41 of the Financial Management for Georgia Local Units of Administration Accounting Manual and the agreement signed by the Board to receive this funding require that the Board transfer required local matching funds to the Capital Projects Fund by June 30, 1998, and designate those funds by project name and number. The transfer was not made by the Board at June 30, 1998, and a correcting audit adjustment was necessary to transfer $39,022.00 from the General Fund to the Capital Projects Fund. Subsequent to June 30, 1998, the Board transferred the required local matching funds to the Capital Projects Fund and designated those funds by project name and number as required. An audit adjustment is included in the financial statements to reflect this transfer in fiscal year 1998.
Management's Response:
The Board of Education had transferred $20,000.00 on February 28, 1998 and $30,820.00 on June 10, 1998 a total of $50,820.00. We were under the impression that this covered the required $39,022.00 of local matching funds for this project. However, because the checks were written at different times and not clearly marked as local matching it was dismissed as not being transferred. A check for this $39,022.00 was issued before the auditors left our office transferring the amount from General Fund to Capital Outlay, even though the $50,820.00 was used paying the architect fee for design fee, bidding process, etc. for this building project.
Auditor's Note: The transfers of $20,000.00 and $30,820.00 did not relate to the matching requirements in question.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: . FS-6261-98-04
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The Chattahoochee County Board ofEducation did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance ofa General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned by the
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CHATTAHOOCHEE COUNTY BOARD OF EDUCATION
SCHEDULE OF FINDINGS AND QUESTIONED CQSTS YEAR ENDED ruNE 30. 1998
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-6261-98-04 Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Asset Account Group. Management's Response: The Chattahoochee County Board of Education does not maintain a system-wide General Fixed Assets Account Group. We have an inventory of all property, furnishings, equipment, etc. listed With date of purchase and cost. However a depreciation of this inventory is not done. When the State implements a uniform plan for this General Fixed Assets Account Group we will comply with this plan.
III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.
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