Clarke County Board of Education, Athens, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2000

CLARKE COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHffiITS

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

6

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

8

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

9

ADDmONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

24

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

26

DEBT SERVICE FUND

G

COMBINING BALANCE SHEET

28

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

29

I

FIDUCIARY FUND TYPE

COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABll..ITIES

AGENCY FUNDS

30

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

31

2 SCHEDULE OF STATE REVENUE

33

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

34

CLARKE COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

4

OVERALL

35

5

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 ON INTERNAL CONTROL OVER COMPUANCE IN ACCORDANCE WITH OMB CIRCULAR A-I33

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

SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE QF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL



RUSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washingtoll Street. S.W.. Suite 214 Atlanta. Georgia 30334-X400
May 8, 2001

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

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

Ladies and Gentlemen:

We have audited the accompanying general purpose financial statements ofthe Clarke County Board of Education, as of and for the year ended June 30, 2000, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe Clarke County Board ofEducation'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 auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our
OpInIOn.

As described in the notes to the general purpose financial statements, the Board's financial statements

have been prepared using certain accounting practices and policies which, in our opinion, vary in

some respects from generally accepted accounting principles. These variances are described as

follows:

.

2000ARL-13A

* The general purpose financial statements ofthe Board did not contain a General Fixed
Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the
general purpose financial statements. To conform to generally accepted accounting principles, these. accounts should be included in the general purpose financial statements.
* The Board did not recognize as expenditures, in the year ended June 30, 2000, a portion
of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2000. Also funds received, subsequent to June 30, 2000, from the Georgia Department of Education for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1999, were improperly recorded in the year ended June 30, 2000. To conform to generally accepted accounting principles, revenues should be recorded when ~vailable 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 Clarke County Board ofEducation as of June 30, 2000, and the results of its operations for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
. In accordance with Government Auditing Standards, we have also issued our report dated May 8, 200 I, on our consideration ofthe Clarke County Board ofEducation's internal control over financial reporting and our tests of its compliance with certain provisions oflaws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Governnient Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements of the Clarke County Board of Education taken as a whole. The accompanying combining statements (Exhibits E through I) and the financial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-B3, Audits of States, Local Governments, and Non-Profit Organizations. are presented for purposes of additional analysis and are not a required part of-the general purpose financial statements. Such information haS been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general purpose financial statements taken as a whole..
2000ARL-13A

A copy ofthis report has been filed as a pennanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 506-24.
Respectfully submitted,

RWH:jb 2000ARL-13A

R sell W. Hinton State Auditor

CLARKE COUNTY BOARD OF EDUCAnON

CLARKE COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 2000

. ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable Regular Accounts Long-Tenn Accounts Receivable from Individuals
Long-Tenn Notes Receivable
Prepaid Items
Inventories Consumable Supplies Food Donated Commodities Purchased Food
Amount Available in Debt Service Fund
Amount to be Provided in Future Years For Payment of: Bond Debt Capital Lease Agreements Long-Tenn Notes Payable Compensated Absences
Total Assets

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 1,416,377.15

$ 12,453,529.78

$ 9.077,991.82

295,846.88 39.363.00

1,094,181.96

48,742.53

34.613.52 123,293.95

97,416.48 30,678.89

$ 12.946,647.13 $ 2,638,654.48 $ 9,126,734.35

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

EXHIBIT "A"

DEBT . SERVICE
FUND

FIDUCIARY FUND TYPE AGENCY FUNDS

$

3,912.82 $

69.546.81

10,549,173.98

ACCOUNT GROUP
GENERAL LONG-TERM
DEBT

TOTALS

(Memorandum Only>

JUNE 30, 2000

JUNE 30, 1999

$ 1,489.836.78 $ 1.750,056.54

32,080.695.58

64.912,858.16

2.887,268.98

43.91

4,326.084.26 39,363.00
34.613.52

3.662.860.80 43.620.00
426.43
110,188.25

$ 13,440,355.78

123.293.95
97,416.48 30,678.89
13,440.355.78

116,480.68
20,615.44 35,426.87
25,325,581.30

18.509,644.22 658,479.38 106.449.32 387.535.29

18,509,644.22 658,479.38 106.449.32 387.535.29

33,709,418.70 607.104.63 116.126.56 348,851.39

$ 13.440,355.78 $

69,590.72 $ 33.102,463.99 $ 71,32-t,446.45 $ 130,759,615.75

-3-

CLARKE COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 2000

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payable Funds Held for Others Capital Lease Agreements Compensated Absences Long-Term Notes Payable General Obligation Bonds Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Continuation of State Programs For Court Ordered Restitu1ion Payments For Debt Service For Default of Sabbatical Leave For Inventories Consumable Supplies Food Donated Commodilies Purchased Food For Purpose of Bond Issue Unreserved Designated for Medical Accounts Designated for Self-Insurance Designated for Cedar Shoals Fumishings Undesignated
Total Fund Equity
Total Liabilities and Fund Equity

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 1.657.610.78 1,403.204.81 $ 31.879.93

$ 396,013.05 884.260.39.
448.71

5,748.65 7.095.37
1,016.912.54 2,124.276.37

$ 3,092,695.52 $ 1,280,722.15 $ 3,154,032.93

$

10.775.18

421.77

$

39.363.00

123,293.95

97,416.48 30;678.89
$

5,972,701.42

303.089.26 113,583.12 1.000.000.00 8,274,622.28

1.218,640.01 ...\

0.00

$ 9.853,951.61 $ 1,357,932.33 $ 5:972.701.42

$ 12,946,647.13 $ 2,638,654.48 $ 9,126,734.35

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

EXHIBIT MAM

DEBT SERVICE
FUND

FIDUCIARY FUND TYPE AGENCY FUNDS

ACCOUNT GROUP
GENERAL LONG-TERM
DEBT

TOTALS

(Memorandum Only)

JUNE 30, 2000

JUNE 30, 1999

$ 1,663,359.43 $ 3,512,732.45

1,806,313.23

1,575,540.27

916,140.32

845,665.05

448.71

27,827.70

1,016,912.54

1,255',709.90

2,124,276.37

854,739.40

$

69,590.72

69,590.72

17,765.06

$

658,479.38

658,479.38

607,104.63

387,535.29

387,535.29

348,851.39

106,449.32

106,449.32

116,126.56

31,950,000.00

31,950,000.00

59,035,000.00

$

69,590.72 $ 33,102,463.99 $ 40,699,505.31 $ 68,197,062.41

$ 13,440,355.78
0.00 $ 13,440,355.78

$

10,775.18

421.77 $

225.77

39,363.00

43,620.00

13,440,355.78

25,325,581.30

426.43

123,293.95

116,480.68

97,416.48 30,678.89 5,972,701.42

20,615.44 35,426.87 26,283,720.70

303,089.26 113,583.12 1,000,000.00 9,493,262.29

125,934.12 1,000,000.00 9,610,522.03

$ 30,624,941.14 $ 62,562,553.34

$ 13,440,355.78 $

69,590.72 $ 33,102,463.99 $ 71,324,446.45 $ 130,759,615.75

-5-

CLARKE COUNTY BOARD OF EDUCATION . COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 2000

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 Central Support Services Other Support Services Food Services Operation Community Services Operations
Capital Outlay Debt Service
Principal Interest Paying Agent Fees
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Payments. to Bond Escrow Agent Capital Leases 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

$ 40,511,648,00 $ 29,860,24
33,425,651.76 2,797,069.38

2,673,227,12 7,511,268.74
1,403,545.95

$ 76,764,229.38 $ 11,588,041.81

$
-,'

47,553,573.95 $
2,864,171.12 1,736,600.87 1,860,139.05 1,016,017.10 5,253,072.83 1,245,635.70 7,531,023.61 4,834,912.45 1,477,049.15
106,682.72
788,290.66 227,918.68
817,005.49 44,318.62

5,298,701.84
726,737.26 307,898,29
292,827.02 8,921.36
29,558.48 357.00
35,537,50
188,555.83 4,715,291.07
63,597,00

$ 77,356,412.00 $ 11,667,982.65

$ -592,182.62 $

-79,940.84

$

858,703.00

$

--196,803.89

$

661,899.11 $

196,803.89 196,803.89

$

69,716.49 $

116,863.05

9,784,235.12

1,169,016.22

10,063.45 61,989.61

FUND BALANCE JUNE 30

$ 9,853,951.61 $

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

1,357 ,932.33

EXHIBIT"B"

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30. 2000

JUNE 30.1999

$ .43.184.875.12 $ 43,061,814.80

7,541.128.98

7,529,106.20

$ 17,146.771.92

50,572,423.68

47,344,624.87

$ 1,129.705.54

603.207.87

5.933.528.74

6.009,015.35

$ 1.129.705.54 $ 17,749.979.79 $ 107.231.956.52 $ 103.944.561.22

$ 52.852,275.79 $ 49,334,457.11

$ 21,440,724.82

3.590,908.38 2.044,499.16 1,860,139.05 1,308,844.12 5,261,994.19 1,275.194.18 7,531.380.61 4,870,449.95 1,477.049.15
295.238.55 4.715.291.07
788,290.66 21,732.240.50

3,438,312.28 2,167.532.33 1.795.635.03 1.075,047.03 5.069.572.16
.804.949.58 .7,696.334.93 4,915,477.50
1,469.993.66 379.734.76
4,503.111.71 782.943.38
15.180,902.49

$ . 12,905,000.00 2,354,118.75 9,201.56

13.722,005.49 2.398,437.37
9,201.56

2.716,269.51 3,022,775.18
3,400.22

$ 21,440.724.82 $ 15.268.320.31 $ 125.733,439.78 $ 104,356.448.86

$ -20,311.019.28 $ 2,481 .659.48 $ -18,501,483.26 $

-411 .887.64

.$ -14,366,885.00 $ -14,366,885.00 858,703.00 196,803.89 $ -196.803.89
$ -14.366,885.00 $ -13,508.182.00 $

167,612.78 -167,612.78
0.00

$ -20,311,019.28 $ -11,885,225.52 $ -32,009,665.26 $

26,283,720.70

25,325,581.30

62,562,553.34

-411,887.64 63,084,717.17

10,063.45 61,989.61

-110,134.90 -141.29

$ 5,972,701.42 $ 13.440,355.78 $ 30,624,941.14 $ 62,562,553.34 -7-

CLARKE COUNTY BOARD OF EDUCATION

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES

.

BUpGET AND ACTUAL (NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNPS

YEAR ENDED JUNE 30, 2000

EXHIBIT"C"

The notes to the general purpose financial statements are an integral parl of this statement -8-

CLARKE COUNTY BOARD OF EDUCATION

EXHffiIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REPORTING ENTITY

TIie Clarke 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 t<;> 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 liabilitie~ 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.

Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.

The, general purpose financial statements account for all State, Federal, Taxes and Other funds under

control of the 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 of a Board's educational , activities. Governmental Fund Types include:

GENERAL FUND - the fund used to account for all financial resources ofthe Board except those' required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.

- 9.:.

, CLARKE COUNTY BOARD OF EDUCATION

EXHmIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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.

DEBT SERVICE FUND - the fund u'sedto account for the accumulation ,ofresources for, and the

payment of, general long-term principal, interest and paying agent fees.

.

- FIDUCIARY FUND TYPES - the funds used to account for assets held by a government unit in a

trustee capacity or as an agent for individuals, private organizations, other government units and/or

other funds. These funds include:

>

AGENCY FUNDS - the funds used to account for assets held in a fiduciary capacity for other funds, governments, or individuals.

ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP ~ A financial reporting device used to account for general obligation debt outstanding, accrued compensated absences long-term notes payable and capital lease obligations.

BASIS OF ACCOUNTING

The accounting and financial reporting treatment applied to a fund is determined by its measuretpent 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 ofthese funds present increases (Le., revenues and other financing sources) and decreases (i.e., expenditures and other financinguses) 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-Term Debt Account Group.

, Agency funds are purely custodial in nature and do not involve measurement ofresults ofoperations.

Governmental funds are accounted for using the modified accrual basis of accounting under which:

- 10-

CLARKE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

.JUNE 30. 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are property taxes, local option sales taxes, intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions-is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 2000, a substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August 1999 and ending in early June 2000.. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1999 and ending in August 2000. State grants to fund the State's share of these contracts were disbursed from the Georgia Department ofEducation to the Board in the same twelve months. As ofJune 30, 2000, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July andAugust 2000, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 2000. Also, the State's portion ofthe compensation paid iIi July and August 2000 was received and recorded as revenue in the fiscal year subsequent to June 30, 2000. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1999, were recorded in the year ended June 30, 2000. 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 di~bursed.
Agency funds are accounted for using the modified accrual basis ofaccounting in recogrllzing assets and liabilities.
BUDGET
The Clarke County Board-ofEducation'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 ofthis tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as

- 11 -

, 'CLARKE COUNTY BOARD OF EDUCAnON

EXHffiIT liD"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
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(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.
CASH AND CASH EQUIVALENTS
. COMPOSITION OF DEPOSITS Cash and cash equivalents' consist of deposits in authorized financial institutions; Georgia Laws OCGA 45-8-14 a~thorize 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 ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. ,The ,Official Code 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) Obliga~ions 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,tand
(8) Obligations of other political subdivisions of the State 9f Georgia..

- 12-

CLARKE COUNTY BOARD OF EOUCAnON

EXHffiIT "0"

. NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

RECEIVABLES

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

LONG-TERM RECEIVABLES FROM INDIVIDUALS Long-term receivables from individuals consist of amounts due from various individuals for court ordered restitution payments due to the Board.

PROPERTY TAXES

The Clarke County Board of Commissioners fixed th~ property tax levy for the 1999 tax year (calendar year) on June 30, 1999 (levy date). Taxes were due on October 20, 1999. The lien date for property taxes was January 1, 1999. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2000. The Clarke 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.

Thetax millage rate levied for the 1999 tax year (calendar year) for the Clarke County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

18.75 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 $17,142,121.13 and was recorded in the Debt Service Fund. The State will terminate collection of this tax once an additional $43,314,835.56 has been collected or on June 30, 2002, whichever occurs first.

INVENTORIES

CONSUMABLE SUPPLIES INVENTORY Inventories ofconsumable supplies are reported on the Combined Balance Sheet at weighted average cost. The Board uses the consumption method to account for consumable supplies inventory whereby an asset is recorded when supplies are purchased and expenditures are recorded at the time supplies are utilized. The inventory reported on the balance sheet is equally offset by a reservation

- 13-

CLARKE COUNTY BOARD OF EDUCATION

EXHIDIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES"
of fund balance which indicates that 'it does not constitute "available spendable resources" even though it is a component unit of net current assets.
FOOD INVENTORIES Ihventories of donated food commodities used in the preparation of meals are reported on the Combi~ed Balance She~t at their Federally assigned value. Purchased foods inventories are reported on the Combined BalanceSheet at cost (first-in, first-out). Donated food commoditiesare recorded as revenues and expenditures at the time commodity items arereceived. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund" balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.
PREPAID ITEMS
"Payments made to vendors for services that will benefit periods subsequent to June 30; 2000, are recorded as prepaid items.
COMPENSATED ABSENCES
Compensated absences represent obligations of the Board relating to employees' rights to receive compensation forfuture absences based upon service already rendered. This obligation relates only to vesting accumulating" leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this . amount is deemed immaterial to the general purpose financial statements.
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 statements during the year bonds are issued. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount ofthese bonds is recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
I
'J
The Board has the following types of interfund transactions:
Reimbursements ofexpendittires initially made from afund that are properly applicable to another
fundare 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. "
- 14-

CLARKE COUNTY BOARD OF EDUCATION

EXHmIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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 ofoperations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. lnterfund eliminations have not been made in the aggregation of this data.

Note 2: DEPOSITS AND INVESTMENTS

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 ofmoney which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. If a depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts.

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

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

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

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

States or of the State of Georgia, ' .

\

(4) Bonds, bills, notes, certificates of indebtedness or other obligations 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 ofthe State of Georgia, and

- 15 -

CLARKE COUNTY BOARD OF EDUCATION

EXHffiIT "D"

. NOTES TOTHE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 2: DEPOSITS AND INVESTMENTS

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

CATEGORIZATION OF DEPOSITS At June 30, 2000, the bank balances were $3,567,900.41. The amoupts ofthe total bank balances are classified into three categories of credit risk:

Category I - 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 Boar:d'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 iIi the Board's name.)

The Boarel's' deposits are classified by risk category at June 30, 2000,.a:s follows:

. Risk Category

Bank Balance

I

$ 119,067.29

2

3,448,833.12

3

.'

0.00

Total

$ 3,567.900.41

. CATEGORIZATION OFINVESTMENTS Investments are classified as to risk by the three categories described below:

. Category 1 - Insured or registered, or sec.urities held by the Board or the Board's agent in the Board's name,
Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Board's name.
Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Board's name.

Funds invested in an investment pool managed by another government are not required to be categorized unless the investing entity owns specific, identifiable investment securities in the pool.

- 16-

(
CLARKE COUNTY BOARD OF EDUCATION NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30; 2000

EXHffiIT "D"

Note 2: DEPOSITS AND INVESTMENTS

At June 30, 2000, the carrying value of the Board's total investments was $32,080,695.58. The investments are classified as to risk categories as follows:

Type of Investment Repurchase Agreements

Risk Categories

2

3

Carrying Amount

Fair Value

$ 795596441 $ 8492 562 93 $=====:lo0~O~O. $16,448,527.34 $16,448,527.34

Not Subject to Categorization

Requirements

Local Government

Investment Pools

Mutual Funds

Total Investments

..

14,551,498.62 14,551,498.62 1,080,669.62 1,080,669.62
$32 080 695 58 $32 080,695 58

The carrying amounts shown above includes amounts maintained in an investment pool by the State of Georgia, Office of Treasury and Fiscal Services in which the Board owns no identifiable securities. The investment policy ofthe State ofGeorgia, Office ofTreasury and Fiscal Servicesfor the Local Government Investment Pool (primary Liquidity Portfolio) does not provide for investment in deriv~tives or similar investments. A description ofthe Primary Liquidity Portfolio is as follows:

The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. The pool is not registered with the Securities and Exchange Commission as an investment company but does operate Georgia Fund 1 in a manner consistent with Rule 2a-7 ofthe Investment Company Act of1940 and is considered to be a 2a-7 like pool. The pool's primary objectives are safety of capital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and values participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents.and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value of the shares. Participation in the pool is voluntary and deposits consist of funds from local governments; operating and trust funds of Georgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund.

Investments in Georgia Fund 1 ~d Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed' as to principal and interest by the U. S. Government or any of its agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2000, was 23 days. The average investment duration for Fund 6 on June 30, 2000, was .80 year.

- 17 -

CLARKE COUNTY BOARD OF EDUCAnON

EXHffiIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 3: NON-MONETARY TRANSACTIONS

,The Board receives food commodities from the United States Departm~nt 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 ofloss 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 participates in the Georgia School Boards Association Risk and Insurance Management System, a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, -motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to administer one or more groups of self-insurance funds, including the processing and defense of claims brought against members of the system. The Board pays an annual premium to the system for its general insurance coverage. Additional coverage is provided through agreements by the system with other companies according.to their' specialty for property, boiler and machinery, general liability (including coverage for sexual harassment, molestation and abuse) and automobile risks. Payment of exc~ss ,insurance for the system varies by line of coverage.

The Board is self-insured with regard to unemployment compensation claims, A premium is charged when needed by the General Fund to each user fund on the basis of the percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on knowri claims and prior experience. .The Board ac~ounts for claims with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated.

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

Beginning of Year Liability ,

Claims and . Changes in Estimates

Claims Paid

End of Year Liability

1999 2000

$

2,331.00 $

6,333.22 $' 8,014.22 $

$

650.00 $ 11.701.00 $ 12,351.00 $

650.00 0.00

The Board participates in th~ Georgia School Boards Association Workers' Compensation Fund, a
public entity risk pool organized on July 1, 1992, to develop, implement, and administer a program
of workers' compensation self-insurance for its member organizations. The Board pays an annual premium to the Fund for its general insurance coverage, Additional insurance coverage is provided

- 18 -

CLARKE COUNTY BOARD OF EDUCAnON

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 4: RISK MANAGEMENT

through an agreement by the Fund with the United States Fidelity and Guaranty Company to provide coverage for potential losses sustainep by the Fund in excess of$350,000.00 loss per occurrence, up to the statutory limit.

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

Position Covered

Amount

All Employees

$ 250,000.00

Note 5: GENERAL LONG-TERM DEBT

REFUNDING During fiscal year 2000, the Clarke County Board of Education refunded $14,180,000.00 of. outstanding bonds. The Board utilized Special Pwpose Local Option Sales Tax (SPLOST) proceeds, as stipulated in the SPLOST referendum, to provide funds for the $14,366,885.00 payment to a bond escrow account. These funds were deposited in an irrevocable trust with an escrow agent to provide for future debt service payments on the 1993 Bond issue. As a result, the liability for 1993 Series Bonds has been removed from the General Long-Term Debt Account Group.

CAPITAL LEASES The Clarke County Board ofEducation has entered into various lease agreements as lessee for buses and computers. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the fu~re minimum lease payments as of the date of their inception.

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

Purpose

Interest Rates

Amount

General Government - Series 1997

4.25% - 5.125% $31.950.000.00

The changes in General Long-Term Debt during. the fiscal year ended June 30, 2000, were as follows:

- 19-

. CLARKE COUNTY BOARD OF EDUCAnON

EXHffiIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 5: GENERAL LONG-TERM DEBT

Long-Term Notes Payable

Capital Leases

. General

Compensated . Obligation

Absences

Bonds

Total

Balance July I, 1999

$ 116,126.56 $ 607,104.63 $ 348,851.39 $59,035,000.00 $60,107,082.58

Additions Capital Leases Annual Leave Earned and Utilized (Net)

858,703.00

38,683.90

858,703.00
38~683.90

Deductions Payments Bonds Refunded

9,677.24

807,328.25

12,905,000.00 13,722,005.49 14,180,000.00 14,180,000.00

Balance June 30, 2000

$ 106449.32 $ 65847938 $ 387535.29 $31 950000 00 $33 102 463 99

At June 30, 2000, payments due by fiscal year which includes principal and interest for these items are as follows:

LONG-TERM NOTE PAYABLE

_.

.

The long-term note payable is an outstanding loan from the D, S, Environmental Protection Agency.

On June 16, 1992, the Board entered into an agreement with the D. S. Environmental Protection

Agency (EPA) for assistance in accordance with the provisions of the Asbestos School Hazard

Agreement Authorization Act of 1990 in the amount of$174,190,00, The terms of the agreement

(loan) are to repay the amount in 36 semi-annual installments of$4,838.62. The first payment was

made on November 30, 1993. The balance of the loan at June 30, 2000 was $106,449.32. Final

payment on the loan must be made by May 30, 2012. The loan provides for no interest charges,

except when payments are in default (late). Payments on this loan'are to be provided from the

General Fund,

- 20-

CLARKE COUNTY BOARD OF EDUCAnON

EXHIBIT "D" .

NOTES TO TIlE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 6: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of $1,587,871.07 for health insurance and retirement contributions paid on the Board's behalfby the following State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance ofNon-Ce'rtified Personnel In the amount of$I,241,641.36

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$126,978.71

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$219,251.00

Note 7: SIGNIFICANT COMMITMENTS

The following is an analysis ofsignificant outstanding construction or renovation contracts executed by the Board as of June 30, 2000:

Project

Unearned Executed Contracts

Cedar Shoals High Renovations Chase Street Elementary Renovations Clarke ~entral High Renovations Hilsman Middle Renovations Whitehead Elementary Renovations Winterville Elementary Renovations

$ 2,475,202.93 950.00
1,271,126.72 1,446,074.63
1,394.31 167.03

$ 5,194.915.62

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

Note 8: CONTINGENT LIABILITIES

ARBITRAGE REBATE TAX
The Federal Tax Refonn Act of 1986 requires issuers of tax-exempt debt to make payments to the
United States Treasury of Investment Income received at yields that exceed the issuer's tax-exempt borrowing rates. The U. S. Treasury requ~res payment every five years. The estimated liability of

- 21 -

CLARKE COUNTY BOARD OF EDUCAnON

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2000

Note 8: CONTINGENT LIABILITIES

$1,349,635.60 at June 30, 2000, is based on tax exempt debt subject to the Tax Refonn Act. The

estimated liability will be updated annually for any tax-exempt issuances or changes in yields

through June 30, 2002. The final calculated liability for the five.:year period is required to be

remitted within 60 days from September 1, 2002.

.

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.

The Board is a defendant in various legal proceedings pertaining !o matters incidental to the perfonnance of routine Board operations. The ultimate disposition of these proceedings is not presently detenninable, but is not believed to be material to the general purpose financial s~atements.

Note 9: ACCUMULATED EMPLOYEES' LEAVE

Full-time twelve month employees earn annual leave ranging from ten to fifteen days each year ,depending upon the employees' length ofcontinuous Board service with a maximum accumulation of thiI1y days. Employees are paid at their current rate ofpay for unused accumulated annual leave upon retirement or tennination of employment. See Note 1 - Compensated Absences '

Note 10: RETIREMENT PLANS

.TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

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

TRS CONTRIBUTIONS REQUIRED AND MADE

Employees of the Board who are covered by TRS are required by State statute to contribute 5% of

their gross earnings to TRS. The Board makes monly employer contributions to TRS at rates

adopted by, the TRS Board of Trustees in accordance with State statute and as advised by their

independent actuary. The required employer contribution rate is 11.29% and employer contributions

for the current fiscal year and the preceding two fiscal years are as follows:

.

- - 22-

CLARKE COUNTY BOARD OF EDUCATION

EXHffiIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

-
Note 10: RETIREMENT PLANS
Fiscal Year
2000 1999 1998

Percentage Contributed
100% 100% 100% ..

Required Contribution
$ 5,388,356.70 $ 5,431,185.51 $ 4,981,084.06

~ 23-

CLARKE COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2000

ASSETS

Cash and Cash Equivalents Accounts R~ceivable

Inventories

Food

Donated Commodities

."

Purchased Food

.SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

1,096,523.10 $

'. 358,063.56

405,703.58

97,416.48 30,678.89

Total Assets

$ 1,630,322.05 $ ==3:=5=8=,0..6..:=3.=56==

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

$

57,349.58 $

127,792.83

226,237.09

229,848.96

$

283,586.67 $

357,641.79

$

$

97,416.48

30,678.89

1,218,640.01

$ 1,346,735.38 $

421.77
0.00 421.77

Total Liabilities and Fund Equity See notes to the general purpose financial statements.
- 24-

$ 1,630,322.05 $ ==3:=5..8.:.!:::,0=63:=.:=56==

EXHIBIT "E"

FEDERAL PROGRAMS

TOTALS

JUNE 30, 2000

JUNE 30,1999

$ 1,454,586.66 $ 1,671,153.15

$

688,478.38

1,094,181.96

555,540.54

97,416.48 30,678.89

20,615.44 35,426.87

$

688,478.38 $ 2,676,863.99 $ 2,282,736.00

$

38,209.51 $

38,209.51

210,870.64

396,013.05 $

297,869.14

428,174.34

884,260.39

815,750.13

448.71

448.71

100.51

$

677,703.20 $ 1,318,931.66 $ 1,113,719.78

$

10,775.18 $

10,775.18

421.77 $

225.77

97,416.48 30,678.89

20,615.44 35,426.87

0.00 .

1,218,640.01

1,112,748.14

$

10,775.18 $ 1,357,932.33 $ 1,169,016.22

$

688,478.38 $ 2,676,863.99 $ 2,282,736.00

- 25-

CLARKE COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30. 2000

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 Business Administration Maintenance and Operation of Plant Student Transportation Services Other ~upport Services Food Services Operation
Capital Outlay

Total Expenditures

Excess of Revenues over (under) Expenditures

OTHER FINANCING SOURCES

Operating Transfers In

Excess of Revenues arid Other Financing Sources over (under) Expenditures

FUND BALANCE JULY 1

Food Inventory - Net Change in Period

Donated Commodities

Purchased Food

..

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

301,502.00 $ 2,371,725.12

3,120,634.99

1,399,045.95

4,500.00

$ 4,821,182.94 $ 2,376,225.12

$ 1,945,419.04

292;660.13 7,332.90'

64,675.11

29,558.48

$ 4,715,291.07

35,338.00 1,045.46

$ 4,715,291.07 $' 2,376,029.12

$

105,891.87 $

196.00

$

105,891.87 $

1,168,790.45

10,063.45 61,989.61

196.00 225.77

FUND BALANCE JUNE 30
See notes to the general purpose financial statements, - - 26-

1,346,735.38 $ ====4=2::::;1,=77==

EXHIBITnF"

FEDERAL PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$ 2,673,227.12 $ 2,524,611.57

$ 4,390,633.75

7,511,268.74

7,478,451.10

1,403,545.95

1,297,741.95

$ 4,390,633.75 $ _....;..;.1..:.1;;;.,.;5;..8.;;;8..:.,;;0....4;..1..;..;.8;;;.1..;.... $ 11,300,804.62

$ 3,353,282.80 $

434,077.13 300,565.39

228,151.91 8,921.36

357.00 199.50 187,510.37

63,597.00
$ . 4,576,662.46 $

$

-186,028.71 $

5,298,701.84 $
726,737.26 307,898.29
292,827.02 8,921.36
29,558.48 357.00
35,537.50 188,555.83 4,715,291.07 63,597.00
11,667,982.65 $
-79,940.84 $

5,147,907.42
701,270.15 376,452.90
2,076.72 244,278.95
17,463.81 26,671.94
8,537.18 49,074.96 252,540.62 . 4,503,111.71 15,882.00
11,345,268.36
-44,463.74

196,803.89

196,803.89

167,612.78

$

10,775.18 $

116.863.05 $

123,149.04

0.00

1,169,016.22

1,156.143.37

10,063.45 61,989.61

-110.134.90 -141.29

$

10,775.18 $ 1,357,932.33 $ 1,169,016.22

- 27-

CLARKE COUNTh"BOARD OF EDUCATION COMBINING BALANCE SHEET DEBT SERVICE FUND JUNE 30, 2000

EXHIBIT"G"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable

PROPERTY TAXES. FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION '.:SALES TAX~_

TOTALS JUNE 30, 2000. JUNE,30,1999

$

3,912.82

$

3,912,82 $

61,138,33

$ 10.549,173:98,' ,. ,10;!;i49,173.98

22,,723,348,38

144.90

2,887,124.08' " . 2.887,268.98

2,541.094,59

Total Assets

$

"

FUND EQUITY

Fund Balances

Reserved

For Debt Service

$

Unreserved

Undesignated

4,057,72 $ 13,436,298.06 $ 13,440.355,78 $ 25,325,581.30

4,057.72 $ 13,436,298,06 $ 13,440,355.78 $ 25,325,581,30

.0.00

0.00

0.00,

0.00

Total Fund Equity $

4,057.72 $ 13,436,298;06 .:~ :13,440,355.78 $25,325.581.30

See notes to the general purpose financial statements. - 28-

CLARKE COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
DEBT SERVICE FUND YEAR ENDED JUNE 30. 2000

EXHIBIT"H"

See notes to the general purpose financial statements.

- 29

CLARKE COUNTY BOARD OF EDUCATION .COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE AGENCY FUNDS YEAR ENDED JUNE 30, 2000

EXHIBIT "I"

GROUP INSURANCE
ASSETS Cash and Cash Equivalents Accounts Receivable

BALANCE JULY 1,1999

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 2000

$

31.21 $

12,397.48 $

12,472,60 $

-43.91

0.00

43.91

43.91

$

31.21 $

12,441.39 $

12,472.60 $ ===~O'';;;OO:;"

LIABILITIES Funds Held for Others ..

$

31.21 $

12,441.39 $

12,472.60 $ ===~O'';;;OO=

DEPENDENT CARE ASSISTANCE PROGRAM
ASSETS Cash and Cash Equivalents
,.
!
. LIABILITIES Funds Held for Others

$

4,202,00 $ 156,111.00 $ 153,876.30 $

6,436.70

$

4,202.00 $ 156,111.00 $ . 153,876.30 $

6,436.70

UNREIMBURSED MEDICAL EXPENSE PROGRAM

ASSETS

Cash and Cash Equivalents

$

13,531.85 $ 264,228.04 $ 214,605.87 $

63,154.02

LIABILITIES Funds Held for Others

$

13,531.85 $ 264,228.04 $ 214,605.87 $ ==6;;,;3"",1=54=.=02=

TOTALS AGENCY FUNDS ASSETS
Cash and Cash Equivalents Accounts Receivable
LIABILITIES Funds Held for Others

$

17,765.06 $ 432,736.52 $ 380,954.77 $

69,546.81

0.00

43,91

43.91

$

17,765.06 $

432,780.43 $

380,954.77 $ ~===6=9=,5=90=.=72=

$

17,765,06 $

432,780.43 $

380,954.77 $ ====6=9=,5=9=0.=72=

See notes to the general purpose financial statements.

. 30

CLARKE COUNTY BOARP OF EPUCATION SCHEDULE OF EXPENDITURES OF FEPERAL AWARDS
YEAR ENDED JUNE 30. 2000

SCHEDULE -1-

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

Agriculture. U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program National School Lunch Program

10.553 10.555

Total Child Nutrition Cluster

Other Programs Pass-Through From Georgia Department of Education Food and Nutrition Program Food Distribution Program (1)

10.550

Total U. S. Department of Agriculture

Corporation for National and Community Service Pass-Through From Georgia Department of Education Leam and Serve America School and Community Based Programs

94.004

Education, U. S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Individuals with Disabilities Education Act Part B - Special Education Flow Through Preschool Capacity Building Improvement Grant
Total Special Education Cluster

84.027
84.173 84.173

Other Programs Direct Impact Aid Pass-Through From Georgia Department of Education Comprehensive School Reform Demonstration Project Elementary and Secondary Education Act Tille I Even Start Grants to Local Educational Agencies Tille II Eisenhower Professional Development Tille VI Innovative Education Program Strategies Class Size Reduction Safe and Drug-Free Schools and Communities Stewart B. McKinney Homeless Assistance Act Education for Homeless Children and Youth Vocational Education Basic Grants to States High School Program Basic Grant Pass-Through From Hall County Board of Education d/b/a Piedmont Migrant Education Agency Elementary and Secondary Education Act Tille I Migrant Education

84.041 84.332
84.213 84.010 84.281 84.298 84.340 84.186 84.196
84.048
84.011

Total U. S. Department of Education

Housing and Urban Development, U. S. Department of Pass-Through From Athens-Clarke County Department of Human Economic Development Alps Road Elementary School Outdoor Leaming Center Project

14.218

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

N/A $ N/A

787,825.08 2,134,611.66 $

$. 2,922,436.74 $

(2) 4,517,092.82 (3)
4,517,092.82

N/A $

198,198.25 3,120,634.99 $

198,198.25 4,715,291.07

N/A $

15,000.00 $

15,000.00

N/A $ N/A N/A
$

517,282.69 $ 87,973.29 41,429.00
646,684.98 $

517,282.~9
87,973.29 41,429.00
646,684.98

29,860.24

(4)

N/A

40,290.00

40,290.00

N/A

334,898.25

334,898.25

N/A

2,325,426.27

2,325,426.27

N/A

77,228.20

66,453.02

N/A

91,738.53

91,738.53

N/A

292,813.26

292,813.26

N/A

56,506.00

56,506.00

N/A

49,205.42

49,205.42

N/A

125,655.00

125,655.00

N/A $

59,216.70 4,129,522.85 $

59,216.70 4,088,887.43

N/A $

63,597.00 $

63,597.00

- 31 -

----------

CLARKE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2000

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Justice. U, S. Department of Direct Truancy Reduction Demonstration Program Pass-Through from Children and Youth Coordinating Counsel Juvenile Justice Delinquency Prevention and Treatment Grant .Skills of Survival and Success
Total U, S. Department of Justice
Labor, U. S. Department of Pass-Through From Northeast Georgia Regional Development Center Job Training Partnership Act , Summer 1999
Defense, U. S. Department of Direct Department of the Army R.O,T,C. Program

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

16,540

$

42,135.64 $

42,135.64

16,540

N/A $

38,972.90

38,972.90

81,108.54 $ _ _....:8::..;1~.1~0::;:,8.:,::54~

17.250

N/A $

17,836.29 $ '--_--:..;17"",8::;;:3:,::6.:::.2"'-9

$

113,429.31 $

310,233,20 (3)

Total Federal Financial Assistance
= N/A Not Available

$

7,541,128.98 $ ~",,;;,9',;;,29;;,,1:1:,9=5=3=.5,;;,,3

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 ~mmodities received and/or consumed by the system during the currel)t fiscal year.
(2) , Expenditures for the School Breakfast Program were not maintained separately and are included in the 2000 National School Lunch Program.
(3) Expenditures for this program include State. and/or Other Funds. Expenditures are not maintained by fund source.
(4) Funds eamed on this program do not require reportin9 of expenditures,

Major Programs are identified by an asterisk (*J in front of the CFDA number.

The Board did not provide Federal Assistance to any Subrecipienl.
:
The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the
Clarke County Board of Education and is presented on the modified accrual basis of accounting which is
the basis of accounting used in the' presentation of the general purpose financial statements.

See notes to the general purpOse financial statements.

-,32 -

CLARKE COUNTY BOARP OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2000

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Limited English-Speaking Students Program Middle School Incentive Program Special Instructional Assistance In-School Suspension Mid-term Adjustment Migrant Education Counselors Technology Specialist Local Five Mill Share Educational Equalization Formula Food Services Vocational Education Other State Programs Altemative Program Apprenticeship Program At-Risk Summer School Program Environmental Science Program Health Insurance Innovative Programs Mentoring Program Mentor Teachers Preschool Handicapped Program Remedial Summer School Teachers' Retirement Year 2000 Project Funding Lottery Programs Assistive Technology Computers in the Classroom
Community Affairs, Georgia Department of Local Assistance Grant Pass-Through from Unified Govemment of Athens-Clarke County
Community Health. Georgia Department of Pre-Kindergarten Program
Human Resources, Georgia Department of Second Step Violence Prevention Program
Office ofSchool Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACTS Education, Georgia Department of Georgia's Reading Challenge Reading First Program
See notes to the general purpose financial statements.

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 23,475,126.00 9,279,839,00 688,897,00 1,073,412.00 303,613.00 6,477,102,00
935,012.00 299,857,00 267,769.00 700,949,00 1,484,401.00 215,452,00 41,266,00
1,538,00 90,872.00 144,212.00 -8,777,073.00 1,023,331.00
$ 355,445.05
180,625.00 40,000.00 47,855.34
2,250.00 1,241,641.36
5,000.00 9,400.00 16,200.00 200,103.00 13,630.49 126,978.71 2.558,00

$ 23,475,126,00 9,279,839.00 688,897,00 1,073,412,00 303,613.00 6,477,102,00

301,502.00

935,012.00 299,857.00 267,769.00 700,949.00 1,484,401,00 215,452,00 41,266.00
1,538.00 90,872.00 144,212.00 -8,777,073.00 1,023,331.00 301,502,00 355,445.05

180,625.00 40,000.00 47,855.34
2,250.00 1,241,641.36
5,000.00 9,400,00 16,200.00 200,103.00 13,630,49 126.978,71 2,558.00

40,652.73 242,873.00

40,652.73 242,873.00

13,713,54 71,060.66
1,130.85
219,251.00

2.088,199,39

13,713.54 71.060.66
1,130.85 2.088,199.39
219,251.00

186,000.00 53,230.00

186.000.00 53,230.00

$ 40,511,648.00 $ 2,673.227.12 $ 43,184,875.12

- 33-

CLARKE COUNlY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED"JUNE 30'-'2000

SCHEDULE "3"

PROJECT
Retiring the remaining $4,000,000.00 in outstanding principal amount of the School District's series 1987 general obligation school bonds on the earliest possible redemption date, at a maximum cost of $4,204,365.00
Making payments on the School District's series 1993 general obligation refunding school bonds from January 1, 1998 throug~ .July 1, 1999 and to fund an escrow account on that date to defease the remaining series 1993 general obligation refunding school bonds to their final maturity date of July 1, 2008, at a total cost of $17,890,347.00
Providing funds to pay the costs of acquiring, constructing and equipping a new Cedar Shoals t:tigh School. Adding to, renovating, repairing, improving and equipping Clarke Central High School. Acquiring any necessary real or personal property and equipment and adding to, renovating, repairing, improving and equipping existing educational buildings, properties and facilities of the School District and paying expenses incident thereto, at a cost of approximately $68,000.000.00

ORIGINAL ESTIMATED
COST (1)
\ '.'

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT YEAR (3),c4)

AMOUNT EXPENDED
IN PRIOR YEARS

$

4,204,365.00 $

4,204,365.00 .

$

4,080,000.00

17,890,347.00

19,431,377.50 $ 15,811,691.25 ..

3,619,686.25

68,000,000.00

62,284,523.58

21,440,724.82

19,164,515.81

$ 90,094,712.00 $ 85,920,266.08 $ 37,252,416.07 $ 26,864,202.06

(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 the projects. Includes all cost from project inception to completion.

(3) The voters of Clarke County approved the imposition of a 1% sales tax to fund the above projects. Amounts expended for these projects may include sales tax proceeds, state, local properly taxes and/or other
funds over the life of the projects.

(4) In addition to the expenditures shown above, the Board has incurred interest to provide advance funding for the above projects as follows: .

Prior Years Current Year Total

$

3,927,045.84

1,964,312.50

$

5,891,358.34

see notes to the general purpose financial statements.

. 34-

CLARKE COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30. 2000

SCHEDULE "4"

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

$

34,558,540.00 $

8.;;.;8:;...;;9~,3:;...;;5~4.~0~0

$

40,616,532.92

1,536,931.01 $ _ _1.;..:.,3~1;...;4~,9;.;;;;2..;;..0.~0~3

$

42,153,463.93

-728,070.38 $ _ _4.;..;1,-,-,4=2~5.l.;,3..;;..93';;';'..:;.55~

$

0.00 $=====0=.0=0

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

CLARKE COUNTY BOARD OF EPUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM
GENERAL FUND QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30. 2000

SCHEDULE "5"

EDUCATION TOTAL
REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$ 2,587.010.40 $ 3,124,307.02 $

54,358.15 $ 3.178,665.17

6,656,757.30

8,257,599.04

261,945.48

8,519,544.52

$ 9,243,767.70 $ 11,381,906.06 $

316.303.63 $ 11,698.209.69 $

0.00

2,478.669.40

4,197,138.99

142.2~6.79

4,339,365.78

0.00

3,829.589.10

6.116,030.35

206.741.20

6,322.771.55

0.00

3,523,680.00

3,805.099.79

304,267.41

4.109,367.20

0.00

1.289,430.00

1.283,105.12

45,781.70

1,328,886.82

0.00

803,743.20

892.926.00

117.728.13

1,010,654.13

0.00

$ 21,168,879.40 $ 27.676,206.31 $ 1,133,048.86 $ 28.809,255.17

$ 5,584.523.40 $

171,242.80 $ 930,394.56 4,980,920.28 467,560.94
60.803.43

17,077.65 $ 20,862.25 62.247.74 14.296.56
562.62

188,320.45 951,256.81 5,043,168.02 481,857.50
61,366.05

$ 5.584,523.40 $ 6.610,922.01 $

115,046.82 $ 6,725,968.83

0.00

2,767.331.70

4,097.803.84

60.890.30

4,158.694.14

0.00

$ 8.351,855.10 $ 10,708,725.85 $

175.937.12 $ 10,884,662.97

$

620,007.30 $

652,129.36 $

5,934.05 $

658,063.41

0.00

$ 30,140.741.80 $ 39.037,061.52 $ 1,314.920.03 $ 40,351,981.55

$

781.171.20 $ 1.579.471.40

$ 1,579.471.40

0.00

205,444.00

$

222,010.98

222,010.98

0.00

$

986,615.20 $ 1,579,471.40 $

222.010.98 $ 1,801 ,482.38

$ 31,127.357.00 $ 40,616,532.92 $ 1,536.931.01 $ 42.153,463.93 $

0.00

$

205,450.23

98.162.77

$ =====3:;;,0.3...6:=1=3:=.0"=0

$

208,022.34 $

208,022.34

98,162.77

98,162.77

$

306,185.11 $

306,185.11 $=======0;,;;.0,,=0

- 37 -

.-
SECTIONll COMPLIANCE AND INTERNAL CONTROL REPORTS

RUSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washingtoll Street, S.W.. Suite 214 Atlanta. Georgia 30334-X400
May 8, 2001

.Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Clarke County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL. REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements ofClarke County Board ofEducation as ofand for the year ended June 30, 2000, and have issued our report thereon dated May 8, 2001. 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 auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States._
Compliance
As part of obtaining reasonable assurance about whether Clarke County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination offinancial 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 ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and perfoniling our audit, we considered Clark~ 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
2000YB-40A

control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Clarke County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-6291-00-02.
A material weakness is a condition in which the design or operation of one or more ofthe internal control components does not reduce to a relativelylow level the risk.that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions, and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, the rep<:>rtable condition described above is considered to be a material weakness.
This report is intended solely for the information and use of management, members of the Clarke 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,

RWH:jb 2000YB-40A

R ssell W. Hinton State Auditor

RUSSELL W. HINTON
STATE AUDITOR . (404) 6562174

DEPARTMENT OF AUDITS AND AC~OUNTS
254 Wash,ingtol1 Street. S.W.. Suite 214 Atlanta. Georgia 30334-X400
May 8, 2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Clarke County Board of Education
REPORT ON COMPLIANCE WITH REOUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133
Ladies and Gentlemen:
Compliance
We have audited the compliance ofClarke County Board ofEducation with the types ofcompliance
u.s. requirements described in the Office of Management and Budget (OMB)- Circular A-133
Compliimce Supplement that are applicable to each ofits major Federal progranis for the year ended June 30, 2000. Clarke 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 Clarke County Board ofEducation's management. Our responsibility is to express an opinion on Clarke County Board of Education's compliance based on our audit.
We conducted our audit ofcompliarice in accordance with auditing standards generally accepted in the United States ofAmerica; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States; and OMB Circular A133, Audits of States, 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 ofcompliance 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 Clarke County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Clarke County Board of Education's compliance with those requirements.

2000SA-IOA

In our opinion, the Clarke County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of i.ts major Federal programs for the year ended June 30, 2000.
Internal Control Over Compliance
The management of Clarke 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 Clarke County Board ofEducation's internal control over compliance with requirements. that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-B3.
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 of risk 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 Clarke 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,

RWH:jb 2000SA-IOA

R ell W. Hinton State Auditor

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

CLARKE COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2000

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-6291-98-01 ,FS-6291-98-02 FS-6291-99-01 FS-6291-99-02

Further Action Not Warranted Further Action Not Wartanted Unresolved - See Corrective Action/Responses Unresolved - See Corrective Action/Responses

CORRECTIVE ACTIONIRESPONSES

GENERAL LEDGER Outstanding Loan Finding Control Number: FS-6291-99-01

This loan is a special Environmental Protection Agency loan that bears no interest. Given the tenns of this loan, the Clarke County School District will continue to carry this loan until paid off.

GENERAL FIXED ASSET Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6291-99-02.

Due to budgetary limitations, the Clarke County School District does not intend to pursue the recording of general fixed assets on the financial statements at this time.

SECTION IV FINDINGS AND QUESTIONED COSTS

CLARKE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000
I SUMMARY OF AUDITOR'S RESULTS
1. Type of Report Issued on the Financial Statements The auditor's opinion on the Clarke County Board of Education's financial' statements was qualified for various departures from generally accepted accounting principles.
2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Clarke County Board of Education disclosed a financial statement reportable condition related to the following control category.
General Fixed Assets
The reportable condition described above is considered to be a material weakness.
3. Noncompliance Material to the Financial Statements The audit ofthe Clarke County Board ofEducation disclosed no instances ofnoncompliance that were deemed to be material to the financial statements.
4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Clarke County Board of Education did not disclose any reportable conditions in.internal control over major programs.
5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Clarke County Board ofEducation's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be Reported by Section .510(a) ofOMB Circular A-133 The Clarke County Board ofEducation's audit did not disclose audit findings required to be reported by section .5lO(a) ofOMB Circular A-133.
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program 84.027 Individuals with Disabilities Edu.cation Act - Part B - Special Education - Flow Through 84.173 Individuals with Disabilities Education Act - Part B - Special Education Preschool 84.173 )Individuals with Disabilities Education Act - Part B - Special Education Capacity Building Improvement Grant
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
- 1-

CLARKE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30. 2000
. I SUMMARY OF AUDITOR'S RESULTS
9. Low Risk Auditee The Clarke County Board ofEducation was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education. ,
IT FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL LEDGER Outstanding Loan Nonmaterial Noncompliance Repeated From Prior Year Finding Control Number: FS-6291-00-01
The General Fund had an unpaid loan ouistandi~g in the amount ~f $111 ,287.94 at December 31,
'1999. Article IX, Section V, Paragraph V of the Constitution of the State of Georgia provides, in . part, as follows:
"The governing authority ofany county, municipalitY or other political subdivision ofthis State may incur debt byobtaiiring temporary loans in each year to pay expenses... Such loans shall be payable on or before December 31, ofthe calendar year in which such loan is made... ".
Repayment of loans should be made in conformity 'With constitutional limitations.
Management's Response:
This loan is a special Environmental Protection Agency loan that bears no interest. Given the terms of this loan, the Clarke County School District will continue to carry this loan until fully repaid.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: "FS-6291-00-02
The Clarke County Board of Education 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 b~ing incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to" establish accounting controls and procedures to provide for ,maintenance ofa General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description.
- 2-

CLARKE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000
IT 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-6291-00-02 Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. Management's Response: Due to staffing and budgetary limitations, the Clarke County School District does not intend to pursue the recording of General Fixed Assets on the financial statements until the new regulations stated in the Government Accounting Standards Board Statement Number 34 take effect. ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
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